Reply Brief — Oklahoma, et al., Petitioners v. Environmental Protection Agency, et al.

No. 23-1067

In the Supreme Court of the United States

STATE OF OKLAHOMA, ET AL.,

v.

ENVIRONMENTAL PROTECTION AGENCY, ET AL.,

RESPONDENTS

ON PETITION FOR WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE TENTH CIRCUIT

REPLY BRIEF FOR PETITIONERS

Sean D. Reyes

Gentner Drummond

Attorney General

Attorney General

Stanford E. Purser

Garry M. Gaskins, II

Solicitor General

Solicitor General

OFFICE OF THE UTAH

Jennifer L. Lewis

Deputy Attorney General

ATTORNEY GENERAL

Utah State Capitol Complex OKLAHOMA ATTORNEY

350 North State St.,

GENERAL’S OFFICE

Ste. 230

313 N.E. 21st St.

Salt Lake City, UT 84114

Okla. City, OK 73105

William L. Wehrum

Mithun Mansinghani

WEHRUM ENVIRONMENTAL

Counsel of Record

LAW LLC

LEHOTSKY KELLER COHN

1629 K St., N.W., Ste. 300

LLP

Washington, D.C. 20006

629 W. Main St.

Oklahoma City, OK 73102

(512) 693-8350

mithun@lkcfirm.com

Emily C. Schilling

HOLLAND & HART LLP

222 South Main St.,

Ste. 2200

Salt Lake City, UT 84101

Kristina R. Van Bockern

Aaron B. Tucker

HOLLAND & HART LLP

555 Seventeenth St.,

Ste. 3200

Denver, CO 80202

Counsel for Petitioner

State of Utah

Michael B. Schon

Drew F. Waldbeser

LEHOTSKY KELLER COHN

LLP

200 Mass. Ave. N.W.

Washington, DC 20001

Counsel for Petitioners

State of Oklahoma and

Oklahoma Department

of Environmental

Quality

TABLE OF CONTENTS

Table of Contents ................................................................ i

Table of Authorities ........................................................... ii

Reply .................................................................................... 1

I. Respondents agree that review is warranted,

and this case is an optimal vehicle for review...... 1

II. Respondents’ defense of the Tenth Circuit’s

flawed decision fails. ............................................... 6

Conclusion ......................................................................... 12

(i)

ii

TABLE OF AUTHORITIES

Page(s)

Cases

Am. Elec. Power Co. v. Connecticut,

564 U.S. 410 (2011) ......................................................... 2

Am. Rd. & Transp. Builders Ass’n v. EPA,

705 F.3d 453 (D.C. Cir. 2013) ........................................ 7

Chevron U.S.A. Inc. v. EPA,

45 F.4th 380 (D.C. Cir. 2022) ......................................... 8

EPA v. Calumet Shreveport Refining L.L.C.,

No. 23-1229 (filed May 20, 2024) ......... 1, 2, 3, 4, 5, 6, 12

EPA v. EME Homer City Generation, L.P.,

572 U.S. 489 (2014) ......................................................... 1

Hertz Corp. v. Friend,

559 U.S. 77 (2010) ........................................................... 9

Mercantile Nat’l Bank v. Langdeau,

371 U.S. 555 (1963) ......................................................... 4

New York v. EPA,

133 F.3d 987 (7th Cir. 1998) ........................................ 12

Obergefell v. Hodges,

576 U.S. 644 (2015) ......................................................... 5

PacificCorp, et al. v. EPA,

No. 23-1068 (filed March 28, 2024) ............................... 2

iii

Texas v. EPA,

829 F.3d 405 (5th Cir. 2016) .............................. 9, 10, 11

Texas v. EPA,

No. 23-60069, 2023 WL 7204840

(5th Cir. May 1, 2023)................................................. 5, 7

Travis v. United States,

364 U.S. 631 (1961) ......................................................... 9

W. Virginia v. EPA,

597 U.S. 697 (2022) ......................................................... 3

W. Virginia v. EPA,

90 F.4th 323 (4th Cir. 2024) ........................................... 8

West Virginia v. EPA,

No. 23-1418 (April 16, 2024) .......................................... 5

Statutes

42 U.S.C. § 7410 .................................................................... 3

42 U.S.C. § 7410(a)(1)........................................................... 7

42 U.S.C. § 7410(k)(1)-(3) .................................................... 7

42 U.S.C. § 7411(d)(1) .......................................................... 3

42 U.S.C. § 7429(b)(2) .......................................................... 3

42 U.S.C. § 7502(c) ............................................................... 3

42 U.S.C. § 7504(a) ............................................................... 3

42 U.S.C. § 7545(o)(2)........................................................... 3

iv

42 U.S.C. § 7545(o)(9)(A)(ii) ................................................ 3

42 U.S.C. § 7607(b)(1) ........................................... 1-9, 11, 12

Rulemaking Notices and Regulations

87 Fed. Reg. 9,798 (Feb. 22, 2022) .................................... 10

87 Fed. Reg. 34,873 (June 8, 2022) ..................................... 3

88 Fed. Reg. 9,336 (Feb. 13, 2023) ................................ 7, 10

REPLY

I. Respondents agree that review is warranted, and

this case is an optimal vehicle for review.

The federal government, the States, and regulated industry agree this Court’s review is necessary. As Respondents put it, “the courts of appeals” need “guidance

… regarding the proper application of Section 7607(b)(1).”

Resp.9. This “[u]ncertainty” has “produced wasteful and

time-consuming litigation on the venue issues themselves.” Resp.20. The question presented has divided the

circuits, recurs frequently, and arises in the context of legally and practically important cases. Resp.19-20; see also

Pet.21-26. EPA itself seeks review of the same issues

raised here in a just-filed petition for a writ of certiorari.

See EPA v. Calumet Shreveport Refining L.L.C., No. 231229 (filed May 20, 2024).

Rather than oppose certiorari, the federal government

asks the Court to hold this petition pending a decision in

Calumet, which it claims “is a better vehicle.” Resp.20-22.

That argument is not only wrong but threatens to excise

the States as parties to a dispute over a statute that centers around the “‘core principle’ of cooperative federalism.” EPA v. EME Homer City Generation, L.P., 572

U.S. 489, 511 n.14 (2014). In comparison to Calumet, this

petition more squarely presents all relevant issues critical

to both states and industry, presents the question in a

more important and more frequently recurring context,

and was filed first on an issue that requires urgent resolution. This Court should grant the petition in this case

now and, in the normal course, decide whether it should

also grant Calumet.

(1)

2

A. This petition is an ideal vehicle to resolve the question presented for numerous reasons.

First, this petition and that in PacificCorp, et al. v.

EPA, No. 23-1068 (filed March 28, 2024), involve all three

types of entities that are primary participants in Clean

Air Act programs: the federal government, States, and

regulated industry. Because Calumet involves only challenges brought by small refineries, holding this petition

pending Calumet would cut the States out of litigation

over critical, recurring venue questions impacting their

rights. Doing so would be particularly ironic in the context

of a statute that “envisions extensive cooperation between

federal and state authorities, generally permitting each

State to take the first cut” at implementing regulatory

programs under the Act. Am. Elec. Power Co. v. Connecticut, 564 U.S. 410, 428 (2011) (citation omitted).

Moreover, the States have textual arguments not present in Calumet: Section 7607(b)(1) expressly provides

that venue for challenges to EPA’s “approv[al,] … denial

or disapproval” of state plans lies in the regional circuits.

If this Court reviews only Calumet, it would sideline State

arguments addressing the important question of proper

venue for review of EPA’s actions on state implementation plans. Given how integral state implementation plans

are to the Clean Air Act, and to State sovereign prerogatives under the Act, this Court should ensure that does not

occur.

Second, the state implementation plan issues involved

in this petition allow the Court to answer the question presented in a context that is more central to the Act and will

recur more frequently than the renewable fuel standard

issues presented in Calumet. At the core of the Clean Air

3

Act is a system of cooperative federalism in which States

prepare and EPA approves or disapproves state plans implementing numerous provisions of the Act. See 42 U.S.C.

§§ 7410, 7411(d)(1), 7429(b)(2), 7502(c), 7504(a). These

cases involve implementation of National Ambient Air

Quality Standards under Section 110, one of the Act’s

“three main regulatory programs” for stationary source

emissions. W. Virginia v. EPA, 597 U.S. 697, 707 (2022).

Litigation over EPA’s approval or disapproval of these

state plans is constant. Pet.24-25. The proper interpretation of § 7607(b)(1) directly implicates whether EPA may

force States to challenge disapproval of their individual,

state-specific plans in a consolidated challenge, implicating core state sovereign interests. Pet.27; Senators’ Br.35 (explaining § 7607(b)(1) tracks the Act’s system of cooperative federalism).

The Calumet petition, by contrast, focuses on the renewable fuel standard program. See 42 U.S.C.

§ 7545(o)(2). That EPA-run program requires transportation fuel to include specified amounts of renewable fuel.

Calumet involves EPA’s decision to deny small refineries

a waiver from certain requirements under that program.

Id. § 7545(o)(9)(A)(ii) (allowing EPA to exempt small refineries from the program if they would suffer “disproportionate economic hardship”). EPA denied all pending

waiver requests after “conclud[ing] that small refineries

do not face [disproportionate economic hardship] … no

matter the location or market in which they operate.” 87

Fed. Reg. 34,873, 34,874 (June 8, 2022). If that is correct,

future waivers are likely to be rare. The Calumet petition

therefore raises less-likely-to-recur venue questions in a

scenario that impacts few.

4

Third, certiorari in this case is urgently needed, and

because this petition was filed first, it can be resolved

first. It can be considered before this Court’s summer recess. The Calumet petition was filed in late May, so even

assuming no extensions are granted, the brief in opposition in Calumet will not be due until late June. The earliest

this Court would consider Calumet in the normal course

is the September 30, 2024, conference.

The unnecessary months-long delay that would come

from holding this petition pending Calumet should be

avoided. Respondents all-but-ignore petitioners’ arguments why resolution of the question presented is needed

quickly, given the ongoing litigation in multiple circuits.

Pet. 19-23. Without a grant of certiorari now, the D.C. Circuit may choose to move forward with adjudicating the

merits of EPA’s disapproval of Oklahoma’s and Utah’s

plans before this Court clarifies the proper venue. Cf.

Resp.9 (noting D.C. Circuit’s order in this case, in which

the case is being held in abeyance but requiring motions

to govern after the earlier of July 5, 2024, or disposition of

this petition). This Court’s immediate review would help

avoid that potentially wasted effort.

B. Respondents’ vehicle arguments for holding these

petitions pending Calumet go nowhere. To start, this

Court should not wait for the courts of appeals to reach

final decisions on the merits before granting certiorari.

See Resp.18-19. Venue is a “separate and independent

matter” from “the factual and legal issues comprising the

[merits].” Mercantile Nat’l Bank v. Langdeau, 371 U.S.

555, 558 (1963). The fact that the courts of appeals have

yet to address the merits of the State petitions does not

undermine their square rulings on venue. Contra Resp.20.

5

To the contrary, the existence of these threshold questions is why review is appropriate now, before the parties

and courts spend time and resources litigating the merits

in the wrong venue.

Although there is a theoretical possibility that one of

the courts could “reconsider[],” Resp.19, such speculation

cannot overcome the fact that the circuit split is entrenched. The Tenth Circuit below rejected venue and

transferred the petitions to the D.C. Circuit—there is no

possibility the Tenth Circuit will reverse itself and the

D.C. Circuit is unlikely to revisit venue and send the cases

back. See Pet.22. The Fourth Circuit issued a published

opinion and has denied as premature Respondents’ motion for en banc rehearing of its venue decision. West Virginia v. EPA, No. 23-1418, Doc. 65 (April 16, 2024). And

the Fifth Circuit’s published decision in Calumet simply

confirms that that court will not reverse its consistent interpretation of § 7607(b)(1) in the state implementation

plan cases. Texas v. EPA, No. 23-60069, 2023 WL 7204840

(5th Cir. May 1, 2023). Respondents concede this existing

“circuit conflict,” Resp.19, is sufficiently established and

important to warrant review, Resp.17. This disagreement

over how to interpret § 7607(b)(1) in the state implementation plan cases will not resolve itself.

Nor would delaying review further clarify the issues

before the Court. Five circuits have squarely ruled on the

question presented. Pet.9-14. Four issued detailed written opinions, two included dissenting opinions. Pet.10-12.

Those decisions fully “explain and formulate the underlying principles this Court … must consider.” Obergefell v.

Hodges, 576 U.S. 644, 663 (2015). Thus, the venue issues

in the underlying cases require no further percolation,

6

and the disagreement among the courts in these cases is

at least as well developed, if not more so, as the three opinions at issue in the renewable fuel standard cases. Further, there is no barrier to this Court considering the reasoning of the opinions underlying the Calumet petition

when deciding the venue question in the context of the

state implementation plan cases. The question presented

is ripe for this Court’s resolution in its “usual role as ‘a

court of review.’” Contra Resp.21 (citation omitted).

Finally, the fact that the Tenth Circuit did not address

whether EPA’s disapprovals were “based on a determination of nationwide scope or effect” creates no barrier to

comprehensive interpretation of § 7607(b)(1). Respondents agree that EPA’s reliance on that savings clause

from § 7607(b)(1) would be “properly before” this Court.

Resp.21. The Fourth, Fifth, and Sixth Circuits have

squarely ruled on that clause’s applicability, with two dissenting judges advancing counterarguments. Pet.23. This

aspect of the issue, fairly encompassed within the question presented, is ready for resolution.

The best course is therefore to grant review in this

case now and decide later whether to also grant Calumet

in the normal course.

II. Respondents’ defense of the Tenth Circuit’s flawed

decision fails.

Respondents incorrectly interpret § 7607(b)(1) to give

EPA boundless discretion to manipulate venue.

A. Under Respondents’ view, EPA may make local or

regional actions “national” simply by packaging them into

a single Federal Register notice. Pet.30. Respondents contend that “an action is nationally applicable” if it covers

“more than one federal judicial circuit,” and that the

7

“action” is identified by looking only to “the face” of the

relevant Federal Register notice. Resp.10-11, 14-15.

That glosses over the crucial question: what is the relevant “action” under review? Pet.17. The Act makes clear

that the “relevant unit of administrative action here is the

EPA’s individual [state plan] denials.” Texas, 2023 WL

7204840, at *4. That is because “[e]ach State shall” submit

a plan implementing air standards “within such State.” 42

U.S.C. § 7410(a)(1). And EPA then approves or disapproves each State’s plan, id. § 7410(k)(1)-(3), based on

“the contents of each individual state’s submission,” 88

Fed. Reg. 9,336, 9,354 (Feb. 13, 2023); see also Pet.34. The

relevant action therefore is each state plan disapproval.

The question thus becomes whether EPA’s action purporting to exercise its statutory authority to review individual state plans is “nationally applicable” action. Section 7607(b)(1) confirms it is not. Congress included “approving or promulgating any implementation plan under

section 7410” and “any denial or disapproval by [EPA] under subchapter I” in its list of actions reviewable in the

regional circuits. 42 U.S.C. § 7607(b)(1); see Pet.30-32; Arkansas Br.7-9. Approval or disapproval of state plans is

therefore the “prototypical ‘local or regionally applicable’

action.” Am. Rd. & Transp. Builders Ass’n v. EPA, 705

F.3d 453, 455 (D.C. Cir. 2013). This is not a “petition-focused approach,” contra Resp.15 (citation omitted)—it

turns on the type of action at issue.

Respondents have no real response. They admit that

approvals of state plans are “locally or regionally applicable” actions, at least when EPA chooses to approve “only

… a single State[’s]” plan. Resp.16; see also Pet.31. They

8

simply contend that disapprovals are different, Resp.1516, without explaining why.

EPA suggests that when it relies on “uniform statutory interpretation and common analytical methods,” locally applicable actions become national. Resp.11. But

that cannot be right. Every EPA action “purportedly applies a national standard created by the national statute

and its national regulations.” W. Virginia v. EPA, 90

F.4th 323, 330 (4th Cir. 2024); see also Chevron U.S.A. Inc.

v. EPA, 45 F.4th, 380t 387 (D.C. Cir. 2022) (explaining

that all “locally or regionally applicable actions may require interpretation of the Clean Air Act’s statutory

terms”); Pet.33. Respondents thus admit, as they must,

that “EPA’s use of a national standard” is not sufficient to

render an action nationally applicable. Resp.16-17 (explaining the action must still apply “in multiple judicial

circuits”).

Respondents’ argument thus reduces the venue analysis to whether EPA’s action “applies within more than

one federal judicial circuit,” Resp.11, looking solely at “the

face of the” Federal Register notice, Resp.14. Under that

theory, the form of publication completely controls venue.

But EPA never offers a reason why its decision to publish

actions on multiple state plans in the same notice changes

the nature of the underlying actions. Pet.15-18, 32-33. And

§ 7607(b)(1) itself specifically distinguishes between the

“action” being challenged and EPA’s “notice of such …

action … in the Federal Register.” (emphasis added). Respondents’ form-over-substance reading of § 7607(b)(1) is

thus textually unsupportable.

Moreover, Respondents’ reading gives EPA total

power to manipulate venue through how it publishes

9

otherwise state-specific actions. See Resp.16 (implying

that if EPA had approved plans for more than “a single

state” in a single notice, those approvals could be challenged only in the D.C. Circuit); but see Pet.32 & n.6. EPA

could, for example, publish a single disapproval when a

State falls in what EPA perceives to be a favorable forum,

but group others States in the same notice whenever the

agency prefers the D.C. Circuit. See Senator’s Br.7-9.

This would only “encourage gamesmanship.” Hertz Corp.

v. Friend, 559 U.S. 77, 94 (2010). Section 7607(b)(1) does

not grant EPA the power to ensure “the choice of ‘a tribunal favorable’ to it.” Travis v. United States, 364 U.S. 631,

634 (1961) (citation omitted).

B. EPA’s reliance on § 7607(b)(1)’s savings clause fails

for similar reasons. Resp.12-14.

1. Section 7607(b)(1) provides that venue for “locally

or regionally applicable” actions, can lie in the D.C. Circuit if (1) “such action is based on a determination of nationwide scope or effect” and (2) “in taking such action the

Administrator finds and publishes that such action is

based on such a determination.” In disapproving Petitioners’ state plans, EPA asserted that it was “exercising the

complete discretion afforded to” it to find that the action

was “based on a determination of ‘nationwide scope or effect.’” 88 Fed. Reg. at 9,380. But courts must “make an

independent assessment” of whether the “action” in question was truly based on a determination of nationwide

scope or effect. Texas v. EPA, 829 F.3d 405, 421 (5th Cir.

2016).

“Because the statute speaks of the determinations the

action ‘is based on,’ the relevant determinations are those

that lie at the core of the agency action,” not

10

determinations that are “peripheral or extraneous.” Id. at

419. EPA must “identify” those “core determinations in

the action.” Id. EPA’s final disapproval of Petitioners’

state plans asserted that EPA applied “a common core of

nationwide policy judgments and technical analysis,” including a “nationally consistent 4-step interstate

transport framework for assessing obligations” and “the

results from nationwide photochemical grid modeling.” 88

Fed. Reg. at 9,380.

But those aspects of EPA’s analysis are not “the reason the agency [took] the action” that it did. Texas, 829

F.3d at 419. EPA used its same “4-step framework” and

relied on national air quality modeling when it approved

state plans in separate notices. Pet.33. EPA’s decision

whether to approve or disapprove a state plan thus turned

upon the content of each plan.

Consider the record here. Pet.34. EPA disapproved

Oklahoma’s plan “[b]ecause” it concluded Oklahoma failed

to correctly “analyze emissions from the sources and

other emissions activity from within the State to determine whether its contributions [to downwind States] were

significant.” 87 Fed. Reg. 9,798, 9,823-24 (Feb. 22, 2022).

And EPA reached that conclusion by evaluating “the contents of each individual state’s submission … on [its] own

merits.” Id. at 9,354. It likewise rejected Oklahoma’s reliance on alternative air quality modeling and Oklahoma’s

approach to calculating whether a downwind “receptor”

was likely to struggle to “maintain[]” attainment with the

NAAQS. Id.

Meanwhile, Utah argued that “certain receptors in Colorado should not be counted as receptors,” but EPA rejected

that argument as “insufficient.” 88 Fed. Reg. 9,336, 9,360.

11

It also asserted that Utah “included an insufficient evaluation of additional emissions control opportunities” and

found “technical and legal flaws in the State’s arguments

related to relative contribution, international and non-anthropogenic emissions, and the relationship of upwind

versus downwind-state responsibilities.” Id.

EPA therefore disapproved Petitioners’ plans based

on state-specific findings and conclusions. Because those

core determinations were not “nationwide in scope or effect,” EPA’s reliance on § 7607(b)(1)’s savings clause fails.

2. Respondents nevertheless contend that EPA’s state

plan disapprovals had “nationwide scope and effect” because “EPA made multiple legal and technical determinations regarding issues that cut across the various states”

and because the Good Neighbor provision regulates

cross-border air quality. Resp.12-14.

These are, at best, “peripheral or extraneous” determinations. Texas, 829 F.3d at 419. EPA points to commonalities between its individual analyses of state plans.

Resp.13. But EPA’s application of consistent legal standards and interpretations does not change the fundamentally state-specific analysis it conducted. See Pet.33. If

that were enough, § 7607(b)(1)’s requirement that EPA’s

determinations in fact be “based on a determination of nationwide scope or effect” would be superfluous. Supra 9.

The cross-border nature of air pollution does not make

EPA’s determinations “nationwide” in effect, either. Contra Resp.13-14. The “effect” of EPA’s determinations was

the disapproval of specific state plans, which will change

how specific sources within Oklahoma and Utah are regulated. Those are plainly local effects. And although those

regulatory changes may have some impact downwind,

that kind of second- or third-order effect cannot be

12

enough to make an otherwise state-specific determination

“nationwide.” While “the effects” of any given EPA action

“may be felt in other regions, that would be true of any

major action by the EPA under the Clean Air Act, since

air currents do not respect state boundaries.” New York

v. EPA, 133 F.3d 987, 990 (7th Cir. 1998). Section

7607(b)(1)’s savings clause should not be interpreted in a

way that would swallow the rest of the provision.

CONCLUSION

The Court should grant this petition now, rather than

hold the petition pending a decision in Calumet Shreveport Refining, L.L.C., No. 23-1229 (filed May 20, 2024).

Respectfully submitted,

Gentner Drummond

Sean D. Reyes

Attorney General

Attorney General

Garry M. Gaskins, II

Stanford E. Purser

Solicitor General

Solicitor General

Jennifer L. Lewis

OFFICE OF THE UTAH

ATTORNEY GENERAL

Deputy Attorney General

Utah State Capitol Complex OKLAHOMA ATTORNEY

GENERAL’S OFFICE

350 North State St.,

Ste. 230

313 N.E. 21st St.

Salt Lake City, UT 84114

Okla. City, OK 73105

William L. Wehrum

Mithun Mansinghani

WEHRUM ENVIRONMENTAL

Counsel of Record

LAW LLC

LEHOTSKY KELLER COHN

1629 K St., N.W., Ste. 300

LLP

Washington, D.C. 20006

629 W. Main St.

Oklahoma City, OK 73102

(512) 693-8350

mithun@lkcfirm.com

13

Emily C. Schilling

HOLLAND & HART LLP

222 South Main St.,

Ste. 2200

Salt Lake City, UT 84101

Kristina R. Van Bockern

Aaron B. Tucker

HOLLAND & HART LLP

555 Seventeenth St.,

Ste. 3200

Denver, CO 80202

Counsel for Petitioner

State of Utah

MAY 2024

Michael B. Schon

Drew F. Waldbeser

LEHOTSKY KELLER COHN

LLP

200 Mass. Ave. N.W.

Washington, DC 20001

Counsel for Petitioners

State of Oklahoma and

Oklahoma Department

of Environmental

Quality