Amicus Curiae Brief — Volkswagen Aktiengesellschaft, et al., Petitioners v. Ohio, ex rel. Dave Yost, Attorney General

No. 21-312

In the Supreme Court of the United States

VOLKSWAGEN AKTIENGESELLSCHAFT, ET AL.,

PETITIONERS,

v.

STATE OF OHIO EX REL. DAVE YOST, ATTORNEY

GENERAL, RESPONDENT.

ON PETITION FOR A WRIT OF CERTIORARI

TO THE SUPREME COURT OF OHIO

BRIEF OF AMICI CURIAE ALLIANCE FOR

AUTOMOTIVE INNOVATION AND NATIONAL

AUTOMOBILE DEALERS ASSOCIATION

S. ZACHARY FAYNE

ARNOLD & PORTER

KAYE SCHOLER LLP

Three Embarcadero Center

10th Fl.

San Francisco, CA 94111

(415) 471-3114

JONATHAN S. MARTEL

ELISABETH S. THEODORE

Counsel of Record

SEAN A. MIRSKI

ARNOLD & PORTER

KAYE SCHOLER LLP

601 Massachusetts Ave., NW

Washington, DC 20001

(202) 942-5000

Elisabeth.Theodore@

arnoldporter.com

Counsel for Amici Curiae

i

TABLE OF CONTENTS

Page

TABLE OF AUTHORITIES ............................................ ii

STATEMENT OF INTEREST ....................................... 1

INTRODUCTION AND SUMMARY OF

ARGUMENT .......................................................... 2

ARGUMENT ...................................................................... 6

I.

Manufacturers and Dealers Apply ModelWide Updates to Millions of Vehicles Every

Year, Subject to Comprehensive and

Effective Federal Regulation ................................ 6

A. Model-Wide Changes to In-Use

Vehicles Are Necessary and Common ............ 6

B. For

Decades,

EPA

Has

Comprehensively Regulated ModelWide Changes to Ensure Emissions

Compliance......................................................... 9

C. Evaluating

Whether

Model-Wide

Changes Are Unlawful Tampering

Requires Judgment and Significant

Expertise .......................................................... 15

II. The Ohio Supreme Court’s Decision Further

Destabilizes the Congressionally Created

Federal Regulatory Regime, Further

Threatens Chaos for Manufacturers and

Dealers, and Further Risks Depriving

Consumers of Essential Updates ........................ 17

CONCLUSION ................................................................. 22

ii

TABLE OF AUTHORITIES

Cases

Page(s)

In re Volkswagen “Clean Diesel” Mktg., Sales

Practices, & Prods. Liab. Litig.,

959 F.3d 1201 (9th Cir. 2020) ...................................... 3, 20

Sims v. Fla. Dep’t of Highway Safety and

Motor Vehicles,

862 F.2d 1449 (11th Cir. 1989) ........................................ 19

Statutes

42 U.S.C.

§ 7507.................................................................................... 3

§ 7521(a)(1) .....................................................................9-10

§ 7522(a)(1) ........................................................................ 10

§ 7522(a)(3)(A)................................................................... 12

§ 7522(a)(3)(B)................................................................... 12

§ 7525(a) ............................................................................. 10

§ 7525(a)(1) .................................................................. 10, 13

§ 7541(a)(1) ........................................................................ 10

§ 7541(b) ............................................................................. 11

§ 7541(b)(2) ........................................................................ 10

§ 7543(a) ......................................................................... 2, 19

§ 7543(b) ............................................................................... 3

Pub. L. No. 91-604, 84 Stat. 1676 (1970) ........................... 12

Regulations

40 C.F.R.

Part 85, Subpart T............................................................ 11

§ 85.1802(a) ........................................................................ 11

§ 85.1903............................................................................. 14

§ 85.1904(a) ........................................................................ 11

§ 85.1904(b) ........................................................................ 11

§ 86.1804-01 ....................................................................... 15

§ 86.1806-17 ......................................................................... 8

§ 86.1809-12 ....................................................................... 15

iii

Regulations—Continued

Page(s)

40 C.F.R.

§ 86.1842-01(b)(1).............................................................. 10

§ 86.1842-01(b)(2).............................................................. 10

§ 86.1844-01(f) ................................................................... 13

§ 86.1845-04 ................................................................... 9, 11

§ 86.1846-01 ....................................................................... 11

§ 1068.501........................................................................... 11

Other Authorities

EPA, Advisory Circular No. 2B, Field Fixes

Related to Emission Control-Related

Components (Mar. 17, 1975) ............................... 12, 13, 16

EPA, 2014–2017 Progress Report: Vehicle &

Engine Compliance Activities (Apr. 2019) .................... 9

Hannu Jääskeläinen & Magdi K. Khair,

Exhaust Gas Recirculation ............................................ 15

Letter, Automobile Mfrs. Ass’n to Elliot L.

Richardson, Aug. 27, 1970, reprinted in 1

CAA Legislative History ................................................. 20

1

STATEMENT OF INTEREST1

The Alliance for Automotive Innovation (“Auto

Innovators”) is a nonprofit trade association representing

the manufacturers and suppliers that produce nearly 99

percent of all cars and light-duty trucks sold in the United

States.2 Its mission is to protect and promote the legal

and policy interests of its members that design,

manufacture, and sell motor vehicles throughout the

United States. Auto Innovators’ members rely on the

regulatory certainty provided by the Clean Air Act to

implement routine, model-wide updates to vehicles in

production and in the field. Along with a recent similar

decision from the Ninth Circuit, the decision below

threatens to permit every state and locality in the United

States to regulate and penalize those changes, potentially

in a way that conflicts with the judgment of the U.S.

Environmental Protection Agency (“EPA”) about

whether a change is permissible or constitutes prohibited

tampering with emission controls. Left intact, these

decisions will jeopardize auto manufacturers’ ability to

make these essential updates and upset the post-sale

regulatory regime that has existed for decades.

The National Automobile Dealers Association

(“NADA”) represents nearly 16,500 new-car and -truck

Pursuant to Rule 37.6, amici affirm that no counsel for a party

authored this brief in whole or in part and that no person other than

amici, their members, or their counsel made a monetary contribution

to its preparation or submission. Counsel of record for both parties

received notice at least 10 days prior to the due date of the intention

of amici to file this brief and consented to its filing.

2

Auto Innovators’ automaker members include BMW Group, Ferrari

North America, Ford Motor Co., General Motors Co., American

Honda Motor Co., Hyundai Motor America, Isuzu Motors America,

Jaguar Land Rover, Karma Automotive, Kia Motors America,

Maserati North America, Mazda, Mercedes-Benz USA, Mitsubishi

Motors, Nissan North America, Inc., Porsche Cars N.A., Stellantis,

Subaru of America, Suzuki Motor of America, Toyota Motor North

America, Volkswagen Group of America, and Volvo Car USA.

1

2

dealers and a total of nearly 32,500 franchises. Founded

in 1917, NADA focuses on two main goals: first,

promoting and enhancing the franchise system and

effectively communicating dealer views and concerns to

all branches of the federal government, to manufacturers,

and to the public; and second, strengthening the financial

position of members as retailers. The Ohio Supreme

Court’s decision interferes with both of those core

objectives by threatening to impose “considerable”

penalties on dealers for routine post-sale updates, Pet.

App. 15a, and by potentially chilling dealers’ ability to

serve the needs of their customers. The Ohio Supreme

Court’s decision is particularly injurious to the majority

of dealers who are small businesses.

INTRODUCTION AND

SUMMARY OF ARGUMENT

Together with a recent, parallel decision by the Ninth

Circuit, the decision below threatens to transform a

uniform regulatory regime governing post-sale updates to

millions of vehicles every year into a confusing and chaotic

free-for-all. Absent this Court’s review, these decisions

will have dramatic and adverse implications for the

automotive industry—and, in turn, the vehicle-buying

public. They will make it difficult (and in some cases,

impossible) for the industry to implement essential

updates that improve the performance and emissions of

in-use vehicles. This Court’s intervention is critical.

Each year, dozens of manufacturers design and

thousands of dealers implement millions of physical

changes and software updates to vehicles in the field. The

Clean Air Act (“CAA”) gives EPA exclusive authority to

regulate these updates. The Act broadly preempts all

state and local regulation “relating to the control of

emissions from new motor vehicles,” 42 U.S.C. § 7543(a),

and establishes a comprehensive regulatory regime to

govern model-wide changes to vehicles before and after

3

they are sold.3 Courts have universally and correctly

concluded that the Act preempts state and local

tampering claims arising from pre-sale conduct. Pet. 33.

But the Ohio Supreme Court held below that the Act

nevertheless does not preempt similar efforts to regulate

post-sale, model-wide changes. Pet. App. 16a. By

embracing a position first adopted by the Ninth Circuit

last year, the Ohio Supreme Court has deepened an

existing split with multiple state appellate courts. See Pet.

15-18; see also In re Volkswagen “Clean Diesel” Mktg.,

Sales Practices, & Prods. Liab. Litig., 959 F.3d 1201 (9th

Cir. 2020).

The Ohio Supreme Court’s decision accelerates the

disruption of the orderly, congressionally mandated

regime that has governed manufacturers’ and dealers’

post-sale conduct for decades. By suggesting that every

state and local government may apply its own prohibition

on tampering to manufacturers’ post-sale changes, the

decision portends regulatory chaos. Manufacturers

routinely update the software design and calibration of

their engines and emission control technology, pursuant

to a longstanding and well-understood process with EPA.

These post-sale changes affect millions of cars each year,

and provide important benefits for consumers and for the

environment.

Significantly, post-sale changes often involve complex

technical justifications and tradeoffs—for example,

reducing some types of emissions while increasing others,

or accepting emissions increases under certain defined

operating conditions to redress the potential for engine or

vehicle damage. Contrary to the Ohio Supreme Court’s

apparent assumption, it is often complicated to determine

whether a given post-sale design change or update

amounts to “tampering.” Although one regulator might

The CAA also permits California to promulgate its own emission

standards with EPA approval. Other states may adopt standards

identical to California’s. 42 U.S.C. §§ 7507, 7543(b).

3

4

consider a post-sale change to an emission control or

system to be an improvement, or to be justified to protect

against damage or accident, another regulator might

disagree and conclude that it constitutes prohibited

emissions “tampering.”

Subjecting automobile manufacturers and dealers to

thousands of different regulators for model-wide changes

is untenable. If manufacturers and dealers can no longer

rely on coordination with EPA when making post-sale,

model-wide changes that impact emission controls or

systems, they will risk massive liability for every update.

The effect would be to discourage all post-sale changes,

including those that benefit consumers and the

environment. To be clear, amici do not suggest that

manufacturers or dealers should be able to evade

responsibility for unlawful emissions tampering. Instead,

amici write to underscore that Congress has already

legislated a comprehensive and orderly process for

federal regulatory review and approval of design changes

introduced in the field, and for enforcing prohibitions on

tampering.

That sensible and orderly nationwide

framework would be disrupted if states and localities

could penalize (and, by extension, regulate on a day-today basis) model-wide changes to post-sale vehicles. By

holding otherwise, the Ohio Supreme Court’s decision will

inevitably accelerate—as the dissent recognized—“the

anarchic patchwork of federal and state regulatory

programs that the Clean Air Act is specifically designed

to prevent.” Pet. App. 25a. The decision thus not only

puts at risk the quality of the air and the health and

welfare of the public; it also threatens to harm the health

of the auto industry, which is responsible for nearly ten

million jobs in the United States and is critical to the

nation’s economy. See Pet. App. 21a.

In an amicus brief opposing certiorari in the Ninth

Circuit case, the United States in essence tells the Court

to subject the auto industry to this uncertainty because it

can always fix the problem later. The United States does

5

not dispute that manufacturers and dealers are

responsible for making millions of post-sale updates every

year or that those updates are critical to the industry, to

air quality, and to health and welfare.

Nonetheless, the United States argues that the

Volkswagen case involves conduct that EPA concluded

was unlawful tampering, and that the Court should wait

to see whether state courts will impose liability in a case

where EPA has not found tampering (or has even

approved a manufacturer’s change). But a wait-and-see

approach is untenable for the auto industry, including

amici’s members who must implement post-sale updates,

oftentimes in the absence of EPA pre-approval but after

putting the agency on notice, and who now cannot

implement such post-sale updates without potentially

exposing themselves to state and local tampering claims

and potentially ruinous liability. The government’s

proposal to limit preemption to cases where EPA itself

has deemed the change necessary or appropriate under

the Clean Air Act does not accord with the reality of the

regulatory framework, which relies extensively on

notifications to EPA and submissions of changes for

subsequent approval, and in any event would not even

protect manufacturers who do get pre-approval because

the question of what constitutes sufficient approval is

likely to be disputed. The rule that all model-wide

changes are within EPA’s exclusive province

appropriately avoids these disputes. A case arising in the

narrower context of an approval accordingly is not a

better candidate for certiorari.

The Court should grant certiorari in this case, the

Ninth Circuit case, or both.

6

ARGUMENT

I. Manufacturers and Dealers Apply Model-Wide

Updates to Millions of Vehicles Every Year,

Subject to Comprehensive and Effective Federal

Regulation

Automobile manufacturers and dealers implement

model-wide updates that potentially impact emissions

from millions of vehicles every year, and these updates

are often essential to vehicle performance and to

protecting the environment. Numerous provisions in the

CAA express Congress’s clear intent to give EPA

exclusive authority to regulate these changes to post-sale

vehicles over the course of each vehicle’s “useful life.” To

obtain approval for these changes and to ensure that they

do not constitute prohibited emissions tampering,

manufacturers work closely with EPA, which carefully

weighs complex trade-offs between emissions of different

pollutants, as well as the resulting performance and safety

impacts. And, for decades, manufacturers and dealers

have relied on EPA’s exclusive regulatory authority to

ensure that they can make updates without fear of being

subject to limitless liability from thousands of

independent regulators with competing priorities. That is

what Congress intended.

A. Model-Wide Changes to In-Use Vehicles Are

Necessary and Common

1. Manufacturers and dealers routinely need to

modify the emission controls or systems of vehicles,

including software controls, on a model-wide basis in

order to address performance- or emission-related

problems identified through customer experience once

vehicles are operating in the field.

Typically, a

manufacturer first implements the model-wide change at

the production stage—i.e., to the vehicles that have not

yet been produced and sold. These changes are commonly

referred to as “running changes” and must be submitted

to EPA for approval, though not necessarily pre-approval.

7

Manufacturers, usually working through dealers,

then typically seek to make a corresponding change to

vehicles of the same model type that were already

produced—i.e., post-sale vehicles. These changes are

commonly referred to as “field fixes.” By making such

changes, manufacturers preserve consistency across a

vehicle model population and ensure that all vehicles of

the same model type receive the benefits of the design

change regardless of when they were produced. Indeed,

manufacturers typically maintain a single “latest and

greatest” software package for a vehicle model, so that

when a vehicle in the field comes in to a dealer, the vehicle

is updated to the latest software version. Similarly,

manufacturers may seek to implement the design change

on vehicles from prior model years that use the same or

similar technologies. Such changes also qualify as “field

fixes.”

2. Significantly, over time it has become increasingly

more common for manufacturers and dealers to

implement model-wide changes, and those changes have

become more critical. That is so for two principal reasons.

First, as emission standards have become more

stringent, emission controls, systems, and software have

become more complex. Most engines today use a

combination of various emission control systems, which

are controlled by software that is calibrated precisely for

that vehicle’s attributes to respond to different operating

conditions (such as engine speed and load, altitude, and

temperature).

For example, most modern diesel engines control

emissions through some combination of (a) electronic

management of fuel injection into the combustion

chamber; (b) exhaust gas recirculation (“EGR”), which

recirculates a portion of the engine’s exhaust back into the

intake air and combustion chamber to reduce emissions of

nitrogen oxides (“NOx”) from the engine; (c) a diesel

particulate filter that is electronically managed through

periodic “regeneration cycles”; (d) an oxidation catalyst

8

exhaust aftertreatment system to reduce carbon

monoxide and hydrocarbon emissions; and (e) an

electronically-managed selective catalytic reduction

(“SCR”) exhaust aftertreatment system, which injects a

urea solution onto a catalyst bed to convert NOx into inert

nitrogen, water vapor, and small amounts of carbon

dioxide (“CO2”). Each of these systems has grown in

complexity to match increasingly stringent emission

standards.

Further, each of these controls or systems has

limitations; not all of them are effective in all modes of

vehicle operation. As a result, they must be carefully

managed in conjunction with each other to maintain

compliance with emissions standards. EGR technology,

for example, reduces NOx emissions but increases

particulates (soot), fuel consumption (and thus CO2

emissions), and engine wear. Similarly, SCR technology

is less effective until the catalyst temperature reaches an

optimum target zone, and it depends on injecting a precise

amount of urea onto the catalyst at precise times in

response to different operating conditions.

Manufacturers carefully calibrate the software

controls for these devices and may adjust the calibrations

throughout the model year to optimize often competing

variables. Unsurprisingly, the increased computerization

of emission controls has only added to the need for

software updates to optimize emission control calibration

and design.

Second, EPA has adopted monitoring and emissions

testing compliance requirements for in-use vehicles that

make it easier to detect—and for manufacturers to

correct—issues in the field. For example, starting in the

1990s, EPA required onboard diagnostic software

systems to monitor and generate feedback on the in-use

performance of emission control components. See 40

C.F.R. § 86.1806-17. Some of these issues can arise years

after the vehicle has been sold, meaning that some

9

improvements will be implemented model-wide only on

in-use vehicles.

EPA has also established “[m]anufacturer in-use

verification testing requirements,” which require

manufacturers to evaluate whether in-use vehicles are

complying with emission standards. 40 C.F.R. § 86.184504. Like onboard diagnostic systems, these in-use

emissions testing requirements can help manufacturers

detect issues involving actual operating conditions that

may require model-wide improvements.

As a result of these developments, model-wide

changes to post-sale vehicles are more common today

than ever, and that trend will likely only continue. On

average, for example, over six million vehicles receive

post-sale updates every year through EPA’s recall

program alone.4 And the recall program accounts for only

a fraction of post-sale updates performed under EPA’s

auspices. One member of amicus Auto Innovators

estimates that new or refreshed models require ten to

twenty updates per model annually. Even older models

require about five updates per year. Another member

estimates that models average approximately one

emissions-related update per year for the first seven

years of a vehicle’s life, with most changes occurring in the

first three years.

B. For Decades, EPA Has Comprehensively

Regulated Model-Wide Changes to Ensure

Emissions Compliance

Congress directed EPA in the CAA to prescribe the

emission standards that manufacturers must design

motor vehicles to meet not only at the point of initial sale,

but also for their entire “useful life.” 42 U.S.C.

EPA, 2014–2017 Progress Report: Vehicle & Engine Compliance

Activities 7 (Apr. 2019), https://tinyurl.com/EPARecallReport (2014–

2017 period).

4

10

§ 7521(a)(1). The resulting regulatory scheme operates

both pre- and post-sale.

1. First, before launch, EPA requires testing of “any

new motor vehicle or new motor vehicle engine submitted

by a manufacturer to determine whether such vehicle or

engine conforms with [emissions] regulations.” Id.

§ 7525(a)(1). Manufacturers interact extensively with

EPA technical staff throughout this testing process to

provide information and address concerns. Once all goes

well, a manufacturer then applies for a “certificate of

conformity” that certifies that a particular vehicle

configuration will comply with applicable emissions

standards for its useful life. Id. §§ 7522(a)(1), 7525(a),

7541(a)(1) & (b)(2). Only after EPA issues that certificate

of conformity can manufacturers introduce a new vehicle

into commerce.

Further, if a manufacturer seeks to make a running

change to a certified configuration of a current modelyear vehicle, it must notify EPA concurrently with or

before making the change in production. 40 C.F.R.

§ 86.1842-01(b)(1). EPA can then require additional

testing to ensure that the updated vehicles will continue

to meet applicable emission standards throughout their

useful life. Id. § 86.1842-01(b)(2). In addition, the

manufacturer must submit updates to its applications for

certificates of conformity to reflect any running changes.

Id. § 86.1842-01(b)(1).

2. But EPA’s statutory duty to regulate motor

vehicle emissions does not stop after new vehicles are

sold; rather, it extends to regulation of a vehicle for its

“useful life.” As rigorous as pre-production emissions and

durability testing is, manufacturers cannot account for

every possible driving condition that a vehicle will face in

the real world; as discussed above, updates are often

necessary.

EPA relies on several authorities to regulate the

emissions of in-use vehicles. Its hallmark authority is to

11

investigate and order a recall whenever “a substantial

number” of a class or category of vehicles do not conform

to applicable CAA requirements. Id. § 85.1802(a).

The CAA also requires EPA to “establish . . . methods

and procedures” to test “whether, when in actual use,”

vehicles “compl[y] with . . . emission standards.” 42 U.S.C.

§ 7541(b). Like EPA’s pre-sale testing requirements

designed to ensure that vehicles are compliant when sold,

these post-sale testing requirements help ensure that

vehicle emissions are compliant throughout their full

useful life. See 40 C.F.R. §§ 86.1845-04 (EPA’s In-Use

Verification Program); 86.1846-01 (In-Use Confirmatory

Program).

And EPA requires manufacturers to monitor,

investigate, and report “[e]mission-related defect[s]” in

post-sale vehicles, including in defective components and

software. 40 C.F.R. Part 85, Subpart T. EPA may decide

to recall these vehicles to remedy the defect. See id.

§ 1068.501.

Even though EPA has the authority to order a

mandatory recall, manufacturers undertake the vast

majority of recalls on a voluntary basis. EPA will strictly

supervise even these voluntary recalls, however; for

example, a manufacturer must submit a plan for any

voluntary recall, including any modifications to be made

to the vehicles at issue. See id. § 85.1904(a). The

manufacturer will also submit quarterly progress reports

as the recall progresses, so that EPA may monitor the

process and order additional corrective action as

necessary. Id. § 85.1904(a)-(b).

Finally, and especially relevant here, all of these

authorities and tools enable EPA to enforce the CAA’s

tampering prohibition. As enacted in 1970, the CAA’s

tampering prohibition was targeted specifically at

manufacturers’ (and dealers’) post-sale conduct; it made

it unlawful “for any manufacturer or dealer knowingly to

remove or render inoperative” any emission control

12

device or design “after such sale or delivery to the

ultimate purchaser.” Pub. L. No. 91-604, § 7(a)(3), 84 Stat.

1676, 1693 (1970). Congress was thus not only well aware

that manufacturers (and dealers) would make post-sale

changes, but it also limited such changes to prohibit

unlawful tampering. Then, as today, Congress gave EPA

the exclusive responsibility to enforce that prohibition.5

EPA also recognized, however, that as described

above, the line between legitimate updates to a vehicle

and those that constitute “tampering” might not always

be clear. See Part I.C, infra. Indeed, some of these

updates are required by EPA. The line is especially

blurry for field fixes, which EPA defines as “[a]

modification, removal or replacement of an emissioncontrol related component by a manufacturer or dealer,

or revision by a manufacturer for implementation by

dealers to specifications or maintenance practices for

emission-control related components on vehicles that

have left the assembly line.” EPA, Advisory Circular No.

2B, Field Fixes Related to Emission Control-Related

Components, at 1 (Mar. 17, 1975) (“Field Fix Guidance”).

In 1975, in response to concerns that legitimate postsale updates could improperly fall afoul of the tampering

prohibition, EPA issued the Field Fix Guidance. The

Guidance sets forth a procedure “by which manufacturers

can assure themselves that EPA will not consider a field

fix to be a violation of Section 203(a)(3) of the Act.” Field

Fix Guidance at 1. In the Guidance, EPA established that

“a change to a certified vehicle . . . that is identical in all

respects to a running change that is approved for

incorporation in new vehicles by the manufacturer” does

not constitute prohibited tampering. Id. at 2-3. In other

words, it is per se lawful for a manufacturer to update inuse vehicles to conform to the latest design of vehicles

from the same model year that are still on the production

Today, the provision applies even more broadly.

§§ 7522(a)(3)(A)-(B).

5

42 U.S.C.

13

line. Since all changes to vehicles on the production line

must be submitted to EPA, that necessarily means that

all field fixes to same-model-year vehicles are overseen by

EPA. And while the United States notes (Br. 21) that

production-line changes no longer require pre-approval,

manufacturers must still notify EPA before making the

change, and EPA may later disapprove of the change and

require the changed vehicles to be recalled. EPA silence

thus functions as approval.

EPA also addressed field fixes to prior-model-year

vehicles that are no longer in production. Under the CAA,

manufacturers receive a certificate of conformity only for

a single model year of a vehicle, and they must obtain a

new certificate of conformity for each succeeding model

year even if the vehicle configuration has not changed. 42

U.S.C. § 7525(a)(1). Even where changes are made to a

vehicle configuration from one model year to the next,

emission-control technologies most often carry over

across multiple model years. It is common industry

practice for a manufacturer to take any improvements in

the emissions controls, systems, or software on its

vehicles in current production and to implement those

changes to prior-model-year, in-use vehicles through field

fixes. See Field Fix Guidance at 2-3.

EPA established in the Field Fix Guidance that a

manufacturer does not violate the tampering prohibition

if it implements this type of prior-model-year field fix

after receiving EPA pre-approval. See id. Specifically,

the manufacturer must present EPA with an explanation

and data demonstrating that the vehicle in its changed

configuration will continue to comply with EPA’s

emissions regulations. This mirrors the requirements

that apply to a “running change” for new vehicles, but it

simply relates only to vehicles already in the field. See 40

C.F.R. § 86.1844-01(f). If a manufacturer chooses not to

seek EPA pre-approval for a prior-model-year field fix,

then EPA reserves the right to “investigate” the matter

further as warranted. Field Fix Guidance at 3. EPA may

14

pursue enforcement if it concludes that the manufacturer

knowingly engaged in tampering. And while pre-approval

is not required in these circumstances, in practice,

manufacturers often submit these types of field fixes for

pre-approval in order to avoid the regulatory risk.

Although the United States carefully asserts in its brief

(at 21) that it has no “regular” practice of providing preapproval or “formal” mechanism for doing so, the reality

is that amici’s members often consult with EPA before

making any significant field fix, and have a robust

exchange in which EPA has every opportunity to reject a

field fix as unlawful tampering. And even where amici’s

members do not discuss a proposed field fix with EPA

directly, they usually address the underlying substantive

issue with the agency as part of the defect reporting

process required under 40 C.F.R. § 85.1903.

In short, EPA is extensively involved in the approval

and regulation of not only pre-sale, but also post-sale

updates to emissions control technology.

If a

manufacturer undertakes a recall, that process either will

be instigated by EPA itself or will require the

manufacturer to update EPA through a series of reports.

If a manufacturer seeks to incorporate a change into

same-model-year vehicles that are still in production, that

running change will be submitted to EPA for approval (if

not always pre-approval) and incorporated into the

applications for certificates of conformity.

If a

manufacturer seeks to incorporate a change to priormodel-year vehicles, EPA provides a path for preapproval that, in practice, manufacturers will often take.

Ultimately, one way or another, EPA oversees the

implementation of post-sale updates, with processes

available to manufacturers to minimize the risk of

inadvertently violating the CAA’s tampering prohibition.

And if pre-approval is not sought and obtained, EPA is

still notified of such updates and retains authority to

investigate, order an appropriate fix, and penalize conduct

it determines constitutes tampering.

15

C. Evaluating Whether Model-Wide Changes Are

Unlawful Tampering Requires Judgment and

Significant Expertise

Even where it is not required, manufacturers

regularly consult with EPA or seek approval for post-sale

updates because it is not always clear where the line

between a lawful update and unlawful tampering lies.

Contrary to the Ohio Supreme Court’s apparent belief

(Pet. App. 13a), evaluating whether a particular post-sale

change constitutes “tampering” requires judgment and

significant expertise, and different regulators could reach

different conclusions.

For example, EPA regulations allow designs that

reduce the effectiveness of a vehicle’s emission controls

where necessary to protect the vehicle against damage or

accident in particular field conditions, such as high

altitude, hot or cold conditions, or a sudden increase in

engine load. See, e.g., 40 C.F.R. §§ 86.1804-01, 86.1809-12.

Evaluating such justifications is often technically

complex, requiring balancing of competing physics-based

and engineering considerations. Manufacturers work

closely with EPA to balance those considerations and

ensure that updates comply with the regulations.

Further, many in-use changes to emission control

software may increase emissions of one kind while

decreasing emissions of others. As just one example,

measures to reduce a diesel vehicle’s emissions of NOx—

which is formed from high-temperature combustion—

result in less-efficient combustion and increased fuel

consumption and thus tend to increase emissions of CO2

and particulates.6 These kinds of trade-offs make it

difficult for a manufacturer to know in advance whether

See, e.g., Hannu Jääskeläinen & Magdi K. Khair, Exhaust Gas

Recirculation, https://www.dieselnet.com/tech/engine_egr.php (last

visited Sept. 30, 2021).

6

16

any particular post-sale change will be considered

“tampering.”

Other changes may affect vehicle emissions in a way

that would nevertheless normally be approved by EPA.

For example, a manufacturer may determine that a

calibration change is needed to respond to a complaint

about a vehicle’s driveability. Ordinarily, EPA would

approve such a change so long as any resulting increase in

emissions fell within the emission standard to which the

vehicle was certified. EPA would also routinely approve

the change if it realized that any apparent increase in

criteria emissions was the result of normal test-to-test

variation (for example, due to a different test lab or

different driver conducting the test). Other regulators,

however, may not have the experience to properly

interpret the results of these new tests.

Similarly, EPA routinely approves changes that may

slightly decrease fuel economy in a way that increases

greenhouse gases. One example might be a change to a

vehicle’s transmissions shift schedule to improve

driveability. But other, less experienced regulators may

consider any increase in greenhouse gas emissions, no

matter how small, as tampering.

EPA thus plays a critical role in collaborating with

manufacturers to differentiate justified design changes

that comply with emission regulations from those that

risk being labeled unlawful “tampering.” EPA issued the

Field Fix Guidance precisely in order to “advise

manufacturers on the issue of how [the tampering

prohibition] potentially affects field fixes, and to set forth

a procedure by which manufacturers can assure

themselves that EPA will not consider a field fix to be a

violation” of that provision. Field Fix Guidance at 1. This

oversight process provides needed certainty and

uniformity for manufacturers making updates to vehicles

before and after they are sold to ultimate purchasers.

17

II. The Ohio Supreme Court’s Decision Further

Destabilizes the Congressionally Created Federal

Regulatory Regime, Further Threatens Chaos for

Manufacturers and Dealers, and Further Risks

Depriving Consumers of Essential Updates

As Congress intended in the CAA, EPA’s exclusive,

nationwide jurisdiction over manufacturers’ and dealers’

post-sale changes is critical to assuring a uniform,

functioning

regulatory

system

that

enables

manufacturers and dealers to make essential

improvements to their vehicles. Allowing thousands of

state, county, and local regulators—who lack EPA’s

expertise—to insert themselves into this process would

thwart the congressionally created federal regulatory

process; expose manufacturers and dealers to enormous

uncertainty, potentially significant regulatory liability,

and unfounded consumer litigation; and delay or prevent

essential updates from reaching consumers.

Together with the recent decision of the Ninth

Circuit, the Ohio Supreme Court’s decision forces

manufacturers and dealers either to take a significant risk

every time they make a change to a vehicle model that is

already in the marketplace, or not to provide the essential

update. It is simply not possible to seek approval from

every potential regulator in the United States for each of

the numerous post-sale updates each manufacturer

makes every year, and even a state-level pre-approval

process would be prohibitively burdensome. And even if

seeking such approvals were possible, if even one

regulator considered an in-use change to be unlawful

tampering, the manufacturer would have to redesign the

change to address that regulator’s concerns for that

discrete jurisdiction and then restart the process of

obtaining approval from EPA and other jurisdictions. If

two local or state regulators had differing views about an

update, manufacturers and dealers might then have to

treat vehicles of the same model year differently in

different jurisdictions. That is both impractical and

18

contrary to Congress’s intent to avoid subjecting

manufacturers and dealers to requirements that vary

across States.

The Ohio Supreme Court’s decision also places

dealers—the entities on the front lines of actually making

the changes to vehicles in the field—in an especially

difficult bind. The franchise agreements between dealers

and their manufacturers specifically require that dealers

conduct necessary field changes and updates, along with

emissions warranty and recall work. Dealers are also

regulated by EPA, are subject to the CAA’s antitampering provisions, and take those responsibilities

seriously. But the majority of franchised automobile

dealers in the United State are small businesses. The

typical member of amicus NADA has around 60

employees, and 35% sell fewer than 300 new cars a year.

Requiring franchised dealers to second-guess the field fix

instructions of their manufacturers would impose an

untenable burden—they simply lack the technical and

legal expertise to determine whether an update complies

with multiple overlapping and potentially conflicting sets

of regulations and guidance. Instead, dealers have always

and must continue to rely as a matter of contract and

expertise on the directions provided by manufacturers.

For example, a dealer has no ability to second-guess

whether a software update provided by a manufacturer—

typically contained in proprietary code—qualifies as

“tampering” or not. But the decisions of the Ninth Circuit

and the Ohio Supreme Court mean no dealer can ever

implement an update without risking “considerable”

penalties from local regulators. Pet. App. 15a; see Pet.

App. 18a (“[T]he attorney general’s decision to seek an

additional judgment that could total more than $1

trillion”).

As the dissent below pointed out (Pet. App. 18a), the

automobile industry’s grave concern about the risks and

burdens of multiple, potentially conflicting regulatory

schemes is not theoretical. As the petition notes, the

19

evidence indicates that local and state authorities are

already moving to regulate post-sale, model-wide

updates. See Pet. 22-24. Yet the Ohio Supreme Court

dismissed these concerns because it thought “as long as

Volkswagen complies with, rather than circumvents,

federal law it will have nothing to worry about in Ohio.”

Pet. App. 13a.

That reasoning is flawed. For one thing, Section

209(a) prohibits state and local governments from

enforcing “any standard relating to the control of

emissions from new motor vehicles,” 42 U.S.C. § 7543(a)

(emphasis added), even standards that are nominally

consistent or even identical. See Sims v. Fla. Dep’t of

Highway Safety and Motor Vehicles, 862 F.2d 1449, 1455

(11th Cir. 1989) (CAA preempts state regulation even if it

“does not establish new or conflicting emission

standards”). For another, what constitutes “federal law”

is not always self-evident. The Ohio Supreme Court’s

reasoning erroneously assumes that there will be an

easily achieved consensus among regulators about

whether a particular change constitutes tampering. As

explained, that is simply not true, including for all the

reasons set forth in Part I.C. If every state and local

regulator were free to evaluate in-use changes under their

own criteria, it is a foregone conclusion that some would

reach different conclusions from what EPA would reach.

That is especially so given the immense, per-vehicle, perday penalties at stake, which could give local regulators

significant incentives to recast an update as a tampering

violation. See Pet. 14 (“Respondent seeks daily penalties

of $25,000 per affected car per day, totaling $350 million

per day ....”).

In short, allowing state and local governments to

regulate model-wide changes to in-use vehicles would

create a hopelessly unmanageable patchwork of

regulation. The automobile manufacturing industry

raised a similar concern in its comments on the 1970 CAA

amendments. There, the Automobile Manufacturers

20

Association explained that “[t]he possibility of hundreds

of different [emission] standards” was “wholly unrealistic

from an economic standpoint” and would give rise to “a

myriad of problems.” Letter, Automobile Mfrs. Ass’n to

Elliot L. Richardson, Aug. 27, 1970, reprinted in 1 CAA

Legislative History at 724-25. The CAA addresses this

concern by granting EPA exclusive authority to regulate

manufacturers and dealers’ model-wide emission conduct.

Fifty years later, as the complexity of emission

regulations and emission control technology has

increased significantly, the concern carries even greater

weight.

In its brief opposing certiorari in the Ninth Circuit

case, the United States does not dispute that

manufacturers make millions of post-sale changes every

year that are essential to the environment and to public

health, or that determining the legality of those changes

involves complex tradeoffs and significant EPA expertise.

Instead, it urges denial on the ground that the Court

should wait and see whether lower courts allow state and

local governments to bring suit in cases where EPA

deems the change necessary or appropriate under the

CAA, which suits the government agrees may be

preempted. But the Ninth Circuit has already held that

anti-tampering lawsuits regarding post-sale updates are

not preempted, full stop. In re Volkswagen, 959 F.3d at

1221. In the Ninth Circuit, at least, even EPA approval

may not protect manufacturers and dealers, absent

Supreme Court intervention.

More broadly, while amici appreciate the

government’s recognition that EPA’s concurrence in the

appropriateness of a post-sale change must impliedly

preempt state and local lawsuits, such a ruling would be

too narrow and insufficient to protect the auto industry

and ensure the uniform regulatory scheme Congress

intended. The reality is, as the government itself

emphasizes, that EPA does not have a formal procedure

for pre-approval of post-sale updates. Br. 21. Often,

21

manufacturers submit running changes for approval but

it does not come before the change must be made. Often,

consultations with EPA about field fixes take place

informally. The government seems to think that this

makes certiorari less urgent, but the opposite is true.

Under the government’s approval rule, manufacturers

who engage in good faith discussions with EPA about

post-sale updates and give EPA a chance to review those

updates may still expose themselves to lawsuits from

thousands of state and local regulators. The same is true

for dealers, who have no ability to vet post-sale updates

independently. Given that there are millions of these

changes every year, this situation is untenable. Moreover,

because plaintiffs will not plead the existence of EPA

approval, the government’s rule means that even

manufacturers who receive explicit EPA approval could

be subject to expensive discovery in thousands of lawsuits

presenting trillion-dollar damages requests.

In short, the Court should not wait for a case

presenting a post-sale update that EPA approved. The

government acknowledges that there is a split on the facts

of these cases. And taking one of these cases now will

allow the Court to consider what rule to apply—

preemption for any model-wide post-sale update,

preemption for any post-sale update where a

manufacturer has consulted with EPA or given EPA a

chance to object, or preemption only where a

manufacturer has obtained explicit pre-sale approval. In

the meantime, the Ohio Supreme Court and Ninth Circuit

decisions are subjecting manufacturers and dealers to

potentially ruinous uncertainty, and the Court should step

in.

22

CONCLUSION

The petition for a writ of certiorari should be granted.

Respectfully submitted.

S. ZACHARY FAYNE

ARNOLD & PORTER

KAYE SCHOLER LLP

Three Embarcadero Center

10th Fl.

San Francisco, CA 94111

(415) 471-3114

JONATHAN S. MARTEL

ELISABETH S. THEODORE

Counsel of Record

SEAN A. MIRSKI

ARNOLD & PORTER

KAYE SCHOLER LLP

601 Massachusetts Ave., NW

Washington, DC 20001

(202) 942-5000

Elisabeth.Theodore@

arnoldporter.com

Counsel for Amici Curiae