Opposition Brief — Hazardous Waste Treatment Council v. Environmental Protection Agency

Supreme Court, USs

FILED

ALAY 15 15969

In the Supreme Court of the Unitey Bates

OCTOBER TERM, 1988

No. 88-1532

OO

———— ee .

HAZARDOUS WASTE TREATMENT COUNCIL, PETITIONER

V.

ENVIRONMENTAL PROTECTION AGENCY

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUII

BRIEF FOR THE RESPONDENT IN OPPOSITION

WILLIAM C. BRYSON

Acting Solicitor General

DONALD A. CARR

Acting Assistant Altorney General

SCOTT A. SCHACHTER

Attorney

Depariment of Justice

Washington, D.C. 20530

(202) 633-2217

BEST MILABLE COPY

Ne

QUESTION PRESENTED

Whether the court of appeals properly concluded that

petitioner’s interests are sO marginally related to or incon-

sistent with the purposes of the Resource Conservation

and Recovery Act of 1976 that petitioner lacks standing to

pursue the challenges in this case.

(1)

‘4 .

“ } } ; - { )*

; .

A ‘ .

{ { :

“

’

* ; x |

’

|

| { ;

‘th,

’ i ; ; ' ;

4/ fy} | ; . .

; .

’ ; . , :

; Pe ‘

’ .

: > j

: .

:

;

:

4 ;

Jn the Supreme Court of the Cnited States

OCTOBER TERM, 1988

No. 88-1532

HAZARDOUS WASTE TREATMENT COUNCIL, PETITIONER

Vv.

ENVIRONMENTAI PROTECTION AGENCY

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT!

BRIEF FOR THE RESPONDENT IN OPPOSITION

OPINIONS BELOW

[he opinions of the court of appeals (Pet. App. la-27a,

430a-40a) are reported at 861 F.2d 277 and 866 F.2d 433.

JURISDICTION

Ihe judgment of the court of appeals in No. 86-1143

below was entered on October 7, 1988. Petitions for

rehearing were denied on December 20, 1988. Pet. App.

28a. The judgment of the court of appeals in Nos.

87-1487, 87-1548, and 88-1177 below was entered on

January 13, 1989. The petition for a writ of certiorari was

filed on March 17, 1989. The jurisdiction of this Court ts

invoked under 28 U.S.C. 1254(1)

STATEMENI

[his case involves challenges by petitioner, an industry

trade association, to three regulatory actions taken by the

(1)

ty

Administrator of the United States Environmental Protec-

tion Agency (EPA), pursuant to the Resource Conserva-

tion and Recovery Act of 1976 (RCRA), 42 U.S.C. 6901 e7

seq.

The first EPA action, which was the subject of the first

opinion below, was the promulgation of final regulations

establishing standards under Section 3004(q) of RCRA, 42

U.S.C. 6924(q), for used oil that is burned for energy

recovery. The court of appeals dismissed part of peti-

tioner’s challenge to those regulations for lack of standing

and upheld the rule in all other respects. Pet. App. la-27a.

The other two EPA actions are the subject of the second

opinion below. EPA published a notice establishing the

deadline for certain cement kilns burning hazardous waste

fuel (HWE) to submit permit applications under Section

3005 of RCRA, 42 U.S.C. 6925 (1982 & Supp. IV 1986).

EPA also promulgated final regulations establishing

standards for the permitting of “miscellaneous units”

under RCRA. The court of appeals dismissed petitioner's

challenges to both of those EPA actions because petitioner

lacked standing. Pet. App. 30a-40a. In both of its opin-

ions, the court of appeals determined that petitioncr’s in

terests in the lawsuits were not within the “zone of in

terests” protected or regulated under RCRA.

1. In 1976, Congress enacted Subtitle C of RCRA, 42

U.S.C. 6921-6939b (1982 & Supp. IV 1986). Congress's aim

was to create a comprehensive “cradle to grave” regulatory

program to protect human health and the environment

from the risks associated with the improper handling,

storage, and disposal of hazardous waste. See H.R. Rep

No. 1491, 94th Cong., 2d Sess. 3 (1976). To that end, EPA

must identify and list those solid wastes that are hazard

ous, and thus subject to regulation under Subtitle C. See

’

' »

;

+ : ‘ ; ; . ; | ,* \ 2K) : )

;

‘ : 7 : |

. : , : ,* \ :\ 7 |

tr) , | |

‘ : nf ; . 4 | we .

ry |

(at b- | 4 |

" ' ; . a "

|

: ‘ | |

. ° :

’ ‘ + ,;»

xt KA

4

:

s :

at oy iyi ‘ a f ;™*

On Septem! 5, 1987, EPA | |

' ip} | id

: ' ne HW | | hy . ; ;™

| ’ a

. . :

RCRA

}

j

j

: ;

( ; { j

. PAO}

; . rp 5 ‘

\

i r : 4 is 1

petitioner challenged. The legal basis tor the challenge was

that the regulations were not sufficiently stringent or com

prehensive to protect human health and the environment,

and thus were inconsistent with EPA’s mandate under

RCRA. Petitioner claimed standing to maintain the action

based on injury to the commercial or economic interests of

its members; it alleged that more restrictive regulations

would have expanded the market for products and services

provided by petitioner's members

he court of appeals concluded that the commercial in

terests represented by petitioner are not within the “zone

of interests” protected by RCRA. Pet. App. 5a. Thus,

petitioner lacks standing to represent member firms

allegedly suffering economic injury resulting trom the

failure of EPA’s regulations to force others to use the

more costly methods or technology that petitioner's

members employ or offer for sale. The court of appeals

held, however, that petitioner does have standing to repre

ent members allegedly suffering an environmental injury

as a result of the alleged laxity of EPA regulations. Since

one of petitioner’s members did allege an environmental

injury, the court of appeals reached the merits of peti

tioner’s petition for review. The court upheld the used-oil

regulations challenged by petitioner as consistent with

RCRA. /d. at 2la-27a.’

}. Petitioner also petitioned for review of the noti

tablishing the permit deadline tor ment kilns (C.A

No. 87-1548) and the regulations for miscellaneous unit

; ind T

j ha EPA f |

" i | r

6

(C.A. No. 88-1177).4 At the time the petitions for review

were filed, petitioner alleged solely economic and com-

petitive injury to its members as a result of EPA’s actions.

The economic injury was a loss of potential treatment

business and HWF supply as a result of the diversion of

hazardous waste to less costly methods of hazardous waste

management. Such diversion was allegedly encouraged by

the EPA actions, which allowed certain cement kilns to

burn HWF before receiving a permit, and the potential

permitting of geologic repositories for disposal of hazard-

ous wastes.

The court of appeals held the petitions for review pend-

ing the disposition of a petition for rehearing with sugges-

tion of rehearing en banc concerning the holding in its

earlier opinion that petitioner’s allegations of economic in-

jury do not suffice for standing purposes. See Pet. App.

35a. On December 20, 1988, the court of appeals

unanimously denied rehearing and rehearing en banc. /d.

at 28a-29a. The court of appeals then disposed of the

pending consolidated petitions for review based on its

earlier opinion. The court of appeals held that the <.lleged

competitive economic injuries are insufficent to bring peti-

tioner within the zone of interests protected by RCRA. /d.

at 32a.

The court of appeals also rejected petitioner’s claim of

standing on the basis of the interests of two new

“members” of petitioner—individual private citizens

allegedly suffering environmental injury — because those

individuals were added as members after the statutory

90-day period (see 42 U.S.C. 6976(a)(1)) for challenging

* The court of appeals consolidated those two petitions, and a

similar petition filed by Petro-Chem Processing, Inc. (C.A. No.

87-1487), which is not 4 party here (Pet. 1i n.**), for disposition in a

single Opinion.

these actions under RCRA. Pet. App. 36a-39a. Finally,

the court of appeals also held that the possibility that some

of petitioner’s members might dispose of their treatment

residues in geologic repositories that fail to contain the

residues in the future, that those members might ultimate-

ly be financially responsible for the resulting contamina-

tion, Goes not provide standing. /d. at 39a-40a. Because

petitioner’s members are not required to use any unsafe

disposal methods, and the use of the geologic repositories

would be entirely voluntary, the court found the alleged

economic injury to be self-inflicted, and thus not fairly

traceable to the challenged EPA regulations.

ARGUMENI

rhe standing “zone of interests” test concerns “the ques-

tion whether the interest sought to be protected by the

complainant is arguably within the zcne of interests to be

protected or regulated by the statute * * * in question.”

Association of Data Processing Service Orgs., Inc. v.

Camp, 397 US. 150, 153 (1970). The test excludes plain-

tiffs whose lawsuits “are more likely to frustrate than to

further the statutory objectives.” Clarke v. Securities

Indus. Ass’n, 479 U.S. 388, 397 n.12 (1987).

In cases where the plaintiff is not itself the subject of

the contested regulatory action, the test denies a right

of review if the plaintiff’s interests are so marginally

related to or inconsistent with the purposes implicit in

the statute that it cannot reasonably be assumed that

Congress intended to permit the suit.

Id. at 399. The court of appeals properly applied this

prudential “zone of interests” test to petitioner’s interests

in the cases below. Petitioner’s fact-bound challenges to

the straight forward analysis of the court of appeals do not

merit this Court’s review.

1. Petitioner first argues (Pet. 10-22) that the ruling

below is contrary to this Court’s decision in Clarke v.

Securities Indus. Ass’n, supra. Petitioner contends that the

court of appeals required an affirmative demonstration of

congressional intent to benefit the petitioner in order to

demonstrate standing, a proposition rejected by this Court

in Clarke. That is incorrect. Instead, the court of appeals

sought to find “operational meaning for a test that

demands less than a showing of congressional intent to

benefit but more than a ‘marginal[] rela[tionship]’ ic the

Statutory purposes.” Pet. App. 10a.

Under this Court’s decision in Clarke, whether a plain-

tiff is within the “zone of interests” of a statute is a ques-

tion of whether it should be reasonably inferred that Con-

gress intended that a person with the interest of the par-

ticular plaintiff be relied on to challenge an agency’s al-

leged disregard for the law. Clarke v. Securities Indus.

Ass’n, 479 U.S. at 403.° Under the principles set forth in

Clarke, the prudential test for standing does not require an

indication of a congressional purpose to benefit the plain-

tiff. Jd. at 399-400. Rather, the zone of interests test is

satisfied when “ ‘Congress ha[s] arguably legislated

against the [injury] that [petitioner seeks] to challenge.’ ”

Id. at 403 (quoting Investment Co. Inst. v. Camp., 401

U.S. 617, 620 (1971) (emphasis added)). See Arnold

> Petitioner confuses two related, but separate issues: reviewability,

or whether a particular agency action is subject to judicial review by

any party (see Block v. Community Nutrition Inst., 467 U.S. 340

(1984)), and the standing zone of interests test, or whether a particular

party should be heard to challenge a particular agency action. Pet.

10-11, 23-24. See Clarke v. Securities Indus. Ass’n, 479 U.S. at 399.

The general presumption in favor of judicial review of agency action

under the Administrative Procedure Act does not concern the issue of

who are proper parties to challenge agency action.

Tours, Inc. v. Camp, 400 U.S. 45, 46 (1970); Data Proc-

essing Service Orgs., 397 U.S. at 155-156.

Petitioner’s members are not regulated by the provisions

of the regulations that they challenged in the petitions for

review. Nor does petitioner represent, or otherwise claim

here an injury to‘its members with respect to, the human

health or environmental interests that RCRA was in-

disputably designed to protect.® Rather, petitioner’s sole

interest in these challenges is the enhanced market position

and profit to its members that may result from the applica-

tion of more stringent or comprehensive environmental

regulations to other members of the regulated community.

Because the pecuniary interests of its members thus may

coincide with more stringent hazardous waste regulation,

petitioner asserted below that its interests are within the

zone Of interests protected under RCRA.

In assessing the standing of petitioner, the court of ap-

peals determined that the treatment industry was not an

intended beneficiary of the congressional purpose to pro-

tect human health and the environment under RCRA. Pet.

App. lla, 35a-36a. Rather, the financial benefit to peti-

tioner’s members resulting from the statute and EPA

regulations was an incidental result of the congressional

objective in RCRA to promote safer management of

hazardous waste by encouraging treatment and recycling

over land disposal. As the court of appeals observed, the

indisputable congressional intent to promote human

health and the environment by encouraging the proper

treatment and disposal of hazardous wastes

Shows neither that Congress intended to benefit

recycling and disposal firms nor that such firms’ in-

® See 42 U.S.C. 6902(a)(4) and (6) (Supp. IV 1986). See also H.R.

Rep. No. 1491, 94th Cong., 2d Sess. 3 (1976); H.R. Conf. Rep. No.

1133, 98th Cong., 2d Sess. 80-81 (1984).

10

terests are more than “marginally related” to Con-

gress’s environmental purposes. Whenever Congress

pursues some goal, it 1s inevitable that firms capable

of advancing that goal may benefit. If Congress

authorized bank regulators to mandate physical

security measures for banks, for example, a shoal of

security services firms might enjoy a profit potential.

** * fA] rule that gave any such plaintiff standing

merely because it happened to be disadvantaged by a

particular agency decision would destroy the require-

ment of prudential standing; any party with constitu-

tional standing could sue.

Pet. App. lla.

In applying the Clarke analysis to petitioner, the court

of appeals found that petitioner’s interests were no More

than marginally related to the purposes of RCRA. Pet.

App. 10a-lla. That is because petitioner was before the

court of appeals not as a protector of the environment, but

as a representative of a group of entrepreneurs promoting

business expansion and seeking protection from alleged

economic injury caused by increased competition. /d. at

9a. Thus, the court of appeals properly determined that

petitioner’s competitive interests were only incidentally

related to RCRA’s environmental goals.’

’ Contrary to petitioner's argument that the court of appeals

created a new test or barrier for standing by requiring an affirmative

demonstration of congressional intent to permit sult, the court of ap-

peals expressly stated that the prudential zone of interest test

“demands less than a showing of congressional intent to benefit but

more than a ‘marginal[] reia[tionship]’ to the statutory purposes.” Pet.

App. 10a. The court of appeals’ formulation of the test takes into ac-

count circumstances — which the court of appeals found to be present

in the cases below — where a petitioner’s interests “are more likely to

frustrate than to further statutory objectives.” Clarke v. Securities In-

dus. Ass’n, 479 U.S. at 397 n.12. Accordingly, the court of appeals ac-

} }

j |

) i C |

. \ | \ iT

* ’ . ‘ ’

|

. } }

‘ iit iil

‘ i } ‘

CU ‘ \ \ i : S < |

} | 1 | | | | ~

ACU « \ bihuiiLa Wi

* 4 , ~ if ; f i) ‘

‘ . i i es" i La bic .

} ’ j +}

. ( . . y iL DCTITit bit

. " , , ,

}

if ’ i S . . SiS | With ¢ UTAé

; ‘ ‘ } } ; + «) : " +

. ‘ WC i AC c OllC U iil

, , t i] h t 4

. Ca S | ‘ ext) all that tne

; ; ; = | ] lof

} iis . Uy Ss gia iit should dete!

+ } t 7.

. i . ~ A> | LI1LIONHe! he i

' . ¢

y C < J ~ C LTickIicy

i ADI ii

; rt t att

‘ j 1 LLLC AL, AS petl

) | lhe | ) +} . eh : ‘ ‘ ’ .

iSSC (Pe Plage Rather, the court Ol appeals

t the statutory g f RCRA, Pet. A

ed that the Statulrory EOdals VO! RCRA, Pet. App

, ; —

| , " et | | ‘1 i" ' ‘ Mt ~

ina P relevant legisialtive NISLOTS id. al 3a 36a,

" , ’

} congressional intent

to encourage propel disposal

aste. The court of appeals

‘ver, that such mn intent does not

emonstrate that the competitive and financial interests of

hazardous waste treatment firms have more than a

arginal relationship to Congress's en\ ronmental goals

inder RCRA. /bid

court of appeals perceived a significant

i r [nal netitioner s challenges undel R ¢ R \ could pro

/the “inconsistent with

12

—

duce results inconsistent with the environmental goals of

the statute. Pet. App. 1la-12a. The court of appeals deter-

mined that the outcome of judicial review initiated to pro-

mote petitioner’s competitive interests, while it might

benefit the profits of petitioner’s members, could lead to

environmentally harmful results. Jd. at 12a. That is

because the increased cost of more stringent regulations

might lead to the substitution of more environmentally

harmful waste management methods. /bid.

The same risk was also present in Nos. 87-1487 and

87-1548 below, wherein petitioner sought to limit the num-

ber of facilities burning HWF in competition with peti-

tioner’s members. If successful, petitioner’s challenge

would have fostered the use of rural cement kilns, which

are totally unregulated under RCRA, and the associated

transportation of hazardous waste over long distances to

those kilns. Another result of petitioner’s challenge might

be that fewer facilities would be qualified to treat hazard-

Ous waste, contrary to congressional intent to promote en-

vironmentally protective process substitutfon, materials

recovery, properly conducted recycling and reuse, and

treatment. See 42 U.S.C. 6902(a)(4) and (6) (Supp. IV

1986). The court of appeals’ ruling was thus a direct appli-

cation of Clarke to the standing of petitioner under RCRA.

Petitioner concedes here (Pet. 17) that the protection of

its economic and competitive interests was “obviously not

the ultimate purpose” that Congress intended to further in

enacting RCRA.® Rather, Congress was legislating to pro-

tect human health and the environment. Congress was not

’

’ To support its argument that EPA has “openly acknowledged’

consistency between petitioner’s interests and the goals of RCRA,

petitioner cites a Federal Register notice in an unrelated administrative

proceeding in which EPA restated allegations of fact that petitioner

has made. Pet. 17 n.20; see 52 Fed. Reg. 43,906 (1987). The statement

in the Federal Register notice, however, was merely a recitation of an

13

regulating economic competition in RCRA.’ Consequent-

ly, Congress has not “ ‘arguably legislated against the [in-

jury] that [petitioner seeks] to challenge.’ ” Clarke v.

Securities Indus. Ass'n, 479 U.S. at 403 (quoting /nvest-

ment Co. Inst. v. Camp, 401 U.S. at 620). The court of ap-

peals reasonably concluded that a number of factors

preclude any reasonable inference that Congress intended

to rely on commercial interests such as petitioner’s to vin-

dicate environmental claims under RCRA.

2. Petitioner contends (Pet. 13, 28) that the decision

below conflicts with Deloss v. Department of Housing &

Urban Development, 822 F.2d 1460 (8th Cir. 1987);

Foremost Sales Promotions, Inc. v. Director, Bureau of

Alcohol, Tobacco & Firearms, 860 F.2d 229 (7th Cir.

1988); and City of Milwaukee v. Block, 823 F.2d 1158 (7th

Cir. 1987). No such conflict exists

The present case turns on whether Congress has

‘*arguably legislated against the [injury] that [petitioner

seeks] to challenge,’¢ Clarke v. Securities Indus. Ass’n,

479 U.S. at 403, an inquiry that naturally will vary in its

application trom statute to statute. The court of appeals,

faithfully carrying out the inquiry mandated by Clarke,

studied the provisions and purposes of RCRA and deter-

as-yet-unsubstantiated allegation by petitioner in administrative pro

ceedings that have not yet been completed. See 53 Fed. Reg. 32,899

(1988)

* In the cases where this Court has found competitor standing, the

Statutes al issue contained provisions protecting parties from unlawtul

competion. See, e.g., Hlardin vy. Kentucky Uulities Co., 390 U.S. 1,

$-7 (1968): Chicago \ iichison, ] A S./ R\ . 3§7 U S 77, 83 &4

(1958). RCRA contains no such provisions that make competition

unlawtul. Thus, the court of appeals properiy concluded that the cases

involving commercial competition and market entry restrictions do

not apply to the zone of interests inquiry under RCRA. Pet. App

l2a-l4a

14

mined that it would be inconsistent with the purpose of the

relevant statute to allow the suit. See also Sacilor, Acieries

et Laminoirs de Lorraine v. United States, 815 F.2d 1488,

1491 (Fed. Cir.), cert. denied, 108 S. Ct. 285 (1987). The

cases that petitioner cites involve the construction of

Statutes whose provisions and purposes do not remotely

resemble those of RCRA—in DeLoss, statutes providing

support for low-income housing; in Foremost, a statute

regulating the economic relationship between distributors

and retailers of alcoholic beverages; and in Milwaukee,

Statutes regulating the preferences among various shippers

of agricultural commodities. To hold that “competitors”

of those who are primarily regulated by those statutes have

standing is hardly to say that any decision denying “com-

petitors” standing under any statute is wrong. The decision

below in no sense conflicts with the decisions that peti-

tioner cites.

3. Petitioner also asserts (Pet. 22-30) that the court’s

ruling represents a significant restriction on judicial review

of agency action allegedly inconsistent with statutory

directives, particularly EPA actions under environmental

statutes. The ruling below is very narrow, however. The

question addressed by the court was not whether commer-

cial injury is a basis for standing in challenges to en-

vironmental regulations, whether the treatment industry

has standing to participate in administrative actions, or

whether petitioner may be a party to a challenge alleging

unlawful laxity in EPA regulations. Rather, the court

below merely held that petitioner’s commercial or com-

petitive economic interests fail to meet prudential standing

requirements as a protected interest under a statute in-

disputably designed to promote human health and en-

vironmental interests. Thus, under the ruling of the court

of appeals, a firm or its trade association representative

~

may not initiate a challenge to environmental regulations

under RCRA that do not apply to the firm where the sole

alleged injury is that the rules do not sufficiently maintain

or enhance market position or profits.

Commercial firms alleging economic injury would

generally have standing to challenge rules under which

they are regulated and that injure their interests, commer-

cial or otherwise.'® The vast majority of challenges by in-

dustry members to EPA regulations are of this type.

Moreover, the firm may be a party to a challenge to al-

leged laxity in environmental regulation if another plain-

iff Or petitioner meets the applicable prudential standing

requirements. Indeed, the court of appeals recognized this

in the companion case to petitioner’s challenge to the used-

oil regulations, where petitioner was a co-petitioner with

an environmental organization. Hazardous Waste Treat-

ment Council vy. EPA, 861 F.2d 270, 273 (D.C. Cir. 1988)

(challenge to EPA decision not to list certain used oil as

hazardous waste). Finally, the, firm may, of course, con-

tinue tO pursue its interests by administrative means (e.z.,

by petitioning EPA for a rulemaking) and by legislative

means. Accordingly, this case —invelving only a particular

application of settled legal principles — fails to raise an im-

portant question that merits review by this Court.

See Pet. App. 8a (“That the injury is commercial is no obstacle

‘[Sineering at [commercial] gains by adding “mere” to them does not

; ‘ .

CONCLUSION

[he petition for a writ Of certiorari should t

Respectfully submitted

MAY 1989