Opposition — Chrysler Corp. v. United States Environmental Protection Agency

No. 80-378 |

In the Supreme Court of the Hnited Shree

OCTOBER TERM, 1980

CHRYSLER CORPORATION, PETITIONER

Vv.

UNITED STATES ENVIRONMENTAL PROTECTION

AGENCY AND DOUGLAS M. COSTLE, ADMINISTRATOR

ON PETITION FOR A WRIT OF CERTIORARI TO

THE UNITED STATES COURT OF APPEALS FOR

THE DISTRICT OF COLUMBIA CIRCUIT

BRIEF FOR THE RESPONDENTS IN OPPOSITION

WADE H. McCreg, JR.

Solicitor General

JAMES W. MOORMAN

Assistant Attorney General

DONALD W. STEVER, JR.

CHARLOTTE URAM

Altorneys

Department of Justice

Washington, D.C. 20530

(202) 633-2217

Ree ines Oe

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Se AP ete

~~

In the Supreme Court of the United States

OCTOBER TERM, 1980

No. 80-378

CHRYSLER CORPORATION, PETITIONER

V.

UNITED STATES ENVIRONMENTAL PROTECTION

AGENCY AND DOUGLAS M. COSTLE, ADMINISTRATOR

ON PETITION FOR A WRIT OF CERTIORARI TO

THE UNITED STATES COURT OF APPEALS FOR

THE DISTRICT OF COLUMBIA CIRCUIT

BRIEF FOR THE RESPONDENTS IN OPPOSITION

QUESTION PRESENTED

Whether the court of appeals properly upheld an order

of the Administrator of the Environmental Protection

Agency, issued under Section 207(c)(1) of the Clean Air

Act, requiring Chrysler to recall 208,000 1975 model year

cars where, following adjudicatory proceedings, the

Administrator determined that:

(1) at least 62-79% of the recall class cars were violating

federal carbon monoxide emission standards;

(2) the violations were occurring because of

misadjustments in the carburetor fuel-air mixture; and

(3) the pervasive misadjustments were the foreseeable

result of Chrysler’s emission system design and service

procedures.

a

III

TABLE OF CONTENTS

Page

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TABLE OF AUTHORITIES

Cases:

Berenyi v. Immigration Director, 385 U.S.

GaP daishiesilebiedininine soa benssenstapuasbabieapabihedsaiiebeanouiansenes 6

Branti v. Finkel, No. 78-1654 (Mar. 31,

IFIED nidniddaisinietcepbasbsihanes’ianlccsdonuetsbietiesepnuschebedphnabe 6

Harrison v. PPG Industries, Inc., No. 78-1918

SERIE: UF p. HIME. inhasddlnbvarncecdvesousecooeancebeoneaeiannepies 7

Statutes and regulations:

Clean Air Act, 42 U.S.C. 1857 et seq. :

Section 202, 42 U.S.C. 1857f-1 wo...ccccecccceseeees 2

Section 207(bX 2A), 42 U.S.C.

MES TEER) vocccssccnpeccscoescveccssonccosees 7, 8

Section 207(cX1), 42 U.S.C.

BED TEDUMOM A) | cciccseccosccssscosenies iL, aot, 8

Section 207(cX(3), 42 U.S.C.

SID cidsbsicssadicrubidstibicemceselinebsentee 8

PRECEDING PAGE WAS BLANK i

lV

Page

Statutes and regulations—Continued:

Clean Air Act Amendments of 1977, Pub.

L. No. 95-95, 91 Stat. 685 ef SE. c.ccccrcccceseeenes ]

40 C.F.R. 86.081-22(e)(1) ou... sccsssssssesesseseeeseesnees 4

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A SL Tn DRIED |. keene cevesscesscsdaicaccedpecdedbsnosieocnion 4

Miscellaneous:

38 Fed. Reg. 10317, 10319 (1973) c.rccccccccsesseeeeeees 2

44 Fed. Reg. 2960 (1979) .....cccccccorrcrrrrrrrsrrrsccccoees 4

H.R. Rep. No. 95-294, 95th Cong., Ist Sess.

CRT EY iises csivisdictecchaessacicavisukartorasbedstedivncendnncabiinesie 2

2 A Legislative History of the Clean Air

Amendments of 1970, 93d Cong., 2d Sess.

COE, PEE: BT) vcteisecsctvnchccsineccieencscecten diene 2

1 United States Environmental Protection

Agency, General Counsel Opinions,

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OPINIONS BELOW

The opinion of the court of appeals (Pet. App. la-66a)

is not yet reported. The decision and order of the

Administrator of the Environmental Protection Agency

(Pet. App. 67a-124a) are not reported. The decision and

order of the administrative law judge (Pet. App. 125a-

2lla) are unreported.

JURISDICTION

The judgment of the court of appeals (Pet. App. 212a-

213a) was entered on June 19, 1980. The petition for a

writ of certiorari was fited on September 8, 1980. The

jurisdiction of this Court is invoked under 28 U.S.C.

12541).

STATUTE INVOLVED

Section 207(c\1) of the 1970 Clean Air Act,' 42 U.S.C.

1857f-Sa(cX 1), provides:

If the Administrator determines that a substantial

number of any class or category of vehicles or

engines, although properly maintained and used, do

not conform to the regulations prescribed under

section 202, when in actual use throughout their

useful life [5 years or 50,000 miles], he shall

immediately notify the manufacturer thereof of such

nonconformity, and he shall require the

manufacturer to submit a plan for remedying the

nonconformity of the vehic!es or engines with respect

to which such notification is given. The plan shall

'The recall order under review was first issued on December 8,

1976, pursuant to the 1970 Clean Air Act and before the Clean Air

Act Amendments of 1977, Pub. L. No. 95-95, 91 Stat. 685 et seg. The

1977 Amendments recodified the Act but did not change the statute

as it bears on this case. In this brief we shall refer to the sections of

the 1970 Act as originally codified.

2

provide that the nonconformity of any such vehicles

or engines which are properly used and maintained

will be remedied at the expense of the manufac-

turer. If the manufacturer disagrees with such

determination of nonconformity and so advises the

Administrator, the Administrator shall afford the

manufacturer and other interested persons an

opportunity to present their views and evidence in

support thereof at a public hearing. Unless, as a

result of such hearing the Administrator withdraws

such determination of nonconformity, he shall,

within 60 days after the completion of such hearing,

order the manufacturer to provide prompt

notification of such nonconformity in accordance

with paragraph (2).

STATEMEN1

1. Carbon monoxide is an imperceptible and poisonous

gas; motor vehicles are the single most important source

of carbon monoxide pollution.? Under Section 202 of the

Clean Air Act, 42 U.S.C. 1857f-l, the United States

Environmental Protection Agency (EPA) established

pollution control standards prohibiting 1975 model year

cars from emitting more than 15 grams of carbon

monoxide per mile. 38 "ed. Reg. 10317, 10319 (1973). At

least 62-79% of the 1975 model year Chrysler cars here in

issue violated that standard (Pet. App. 27a, 106a, 196a).

Following extensive tests demonstrating that the recall

class cars were violating the carbon monoxide emission

standard because of .widespread misadjustments of the

carburetor idle mixture of the vehicles, the Administrator

2See 2 A Legislative History of the Clean Air Amendments of 1970,

93d Cong., 2d Sess. 1414, 1428 (Comm. Print 1974). See also H.R.

Rep. No. 95-294, 95th Cong., Ist Sess. 263 (1977).

3

of EPA issued an order under Section 207(cX(1) of the

Act, 42 U.S.C. 1857f-Sa(c)(1), directing a recail of the cars

(Pet. App. 27a, 67a, 125a).3 Chrysler requested a hearing

on the recall order before an administrative law judge.

After adjudicatory proceedings, the administrative law

judge ordered Chrysler to submit a recall plan (id. at

125a-21 1a).

On Chrysler’s administrative appeal, the Administrator

found that a combination of factors in Chrysler’s design

and service procedures had led to the widespread mis-

adjustments and the unusually high failure rates in the

recall class cars.‘ First, Chrysler’s service procedure

fostered misadjustments because it was cumbersome and

time consuming, and required the use of infrared

analyzers, sophisticated diagnostic tools which were

generally unavailable and frequently malfunctioned (Pet.

App. 10a-l4a, 87a, 89a-90a, 203a-204a). Second, the

screw Chrysler provided for adjusting the fuel-air mixture

was overly sensitive (id. at 14a-15a, 90a). One-twentieth of

a turn above Chrysler’s specified adjustment produced

large increases in the idle carbon monoxide concentration,

and one full turn produced an idle carbon monoxide level

approximately 23 times higher than the level that would

meet the standard (id. at 14a).5 Third, the limiter cap

3The statute requires the manulacturer to “submit a plan for

remedying the nonconformity” and to notify car owners of the

nonconformity. 42 U.S.C. 1857f-Sa(c)(1). We loosely refer to these

requirements as “recall” requirements.

‘Chrysler suggests (Pet. 22) that a 1978 study found that such

misadjustments and failures were industry-wide. On the contrary, the

data underlying the study revealed that the average idle carbon

monoxide emission level for all 1975 Chrysler cars was 3.87%, almost

double that of the average for the remainder of the industry (Pet.

App. 39a-40a, 60a).

5Most of the idle mixture screws used by other manufacturers were

substantially less sensitive (Pet. App. 17a-18a).

-

4

Chrysler placed on the idle adjustment screw did not limit

adjustment to the manufacturer’s specifications but rather

permitted adjustments almost ten times greater than the

settings specified (id. at 15a, 18a, 88a, 102a-103a, 207a).°

Finally, and most significantly, the cars as designed

generally did not operate satisfactorily when the

carburetor was adjusted to Chrysler’s specifications

because the specified fuel-air mixture was too “lean” (i.e.,

the proportion of fuel to air was too low) for acceptable

“driveability.” When set as specified, the cars surged,

stalled, hesitated, and had rough idle or other driveability

problems (id. at I5a-17a, 85a-88a, 205a-206a).’ Upon

review of these facts the Administrator determined that

the misadjustments were “encouraged or fostered” by

Chrysler’s defective system design and service procedures,

and that Chrysler should have foreseen the possibility of

widespread misadjustments resulting from its faulty

design and adjustment procedures (id. at 75a).

*Subsequently promulgated regulations make it unlikely that this

problem will recur. The new regulations require pre-sale testing for

emission standard compliance not just at the fuel-air adjustment level

specified by the manufacturer, but anywhere in the adjustable range

of the idle mixture screw. 44 Fed. Reg. 2960 (1979). The pertinent

portions of these regulations are effective for 1981 model year cars. 40

C.F.R. 86.081-22(e1) and (2); 40 C.F.R. 86.081-29. See Pet. App.

Sila.

7Instead of relying on a lean fuel-air mixture, Chrysler could have

achieved compliance with the emission standard and at the same time

alleviated the “driveability” problems by installing air pumps in the

recall class of cars (Pet. App. 7a-9a, 84a-%5a, 206a-208a). Chrysler

had considered but rejected the use of air pumps. In 1973, when

planning for the 1975 model year cars, Chrysler tested 100 1974

model year cars, half with air pumps and half without. The tests

showed that the cars with air pumps complicd with emission

standards but the cars without air pumps did not because of

widespread misadjustments (id. at 62a).

5

The Administrator acknowledged that the key issue in

the proceeding was whether the recall class cars were

“properly maintained” within the meaning of Section

207(c1) (Pet. App. 68a). He rejected Chrysler’s argument

that the vehicles were not “properly maintained” because

the nonconformance with the emission standard was

attributable to misadjustments of the carburetor idle

mixture contrary to the manufacturer’s specifications.

Instead, he concluded (id. at 8la) that “Congress did not

intend the manufacturer to escape responsibility for in-use

emission nonconformities if the manufacturer itself

brought about the condition of misadjustment.”

Accordingly, the Administrator interpreted Section

207(cK1) as requiring EPA to establish by affirmative

evidence “that the vehicles would be maintained in

accordance with the manufacturer’s written instructions

but for the actions of the manufacturer” (Pet. App. 82a;

emphasis in original). Because such a showing was made

in this case and because the other statutory requirements

were also met, the Administrator ordered Chrysler to

submit a recall plan within 30 days (id. at 124a).

On Chrysler’s petition for review, the court of appeals

affirmed the Administrator's order (Pet. App. la-66a).

The court concluded as follows (id. at 66a):

In sum, we agree with the Administrator’s

interpretation of Section 207(c)(l) of the Clean Air

Act, ***that a manufacturer may be _ held

responsible in a recall action for nonconformities

resulting from misadjustments, if such misad-

justments were principally caused by the design

of the emission control system and maintenance

procedures, and if the manufacturer foresaw or

should have foreseen the problem and failed to take

available steps to obviate it. We find substantial

|

6

evidence in the record to support the Administrator’s

conclusion that Chrysler vehicles in the recall class

fail to conform to federal carbon monoxide emission

standards when in actual use, although properly

maintained and used, and thus that Chrysler must

submit a plan for remedying the nonconformity, in

accordance with the Act.

ARGUMENT

Petitioner does not appear seriously to dispute the

Administrator’s determination—affirmed by the court of

appeals—that through its defective design and service

procedures Chrysler was responsible for the fuel-air

mixture misadjustments that caused the violations of the

carbon monoxide emission standard. There is, in any

event, no reason for further review of this factual

determination. See Branti v. Finkel, No. 78-1654 (Mar.

31, 1980), slip op. 5 n.6; Berenyi v. Immigration Director,

385 U.S. 630, 635-636 (1967).

Instead, petitioner contends that the court of appeals

and the Administrator misconstrued the “properly

maintained” language of Section 207(c\1) by making the

automobile manufacturer responsible for nonconformities

caused by misadjustments primarily attributable to design

defects knowingly produced by the manufacturer. This

issue of statutory construction is not of sufficient

continuing importance to warrant review by this Court.

The issue arises from the application of one part of one

section of the Clean Air Act in an unusual factual setting

involving the recall of fewer than 210,000 five-year-old

cars. In addition, as the court of appeals observed (Pet.

App. 40a), this is the first contested recall action under

Section 207(cX1) to reach the courts; there are no similar

cases awaiting judicial review. Moreover, the issue is

unlikely to recur in this particular context because EPA

7

has promulgated new regulations that require 1981 model

year vehicles to pass federal emission standards even when

misadjusted (see note 6, supra). In any event, the decision

below’ is correct, and does not conflict with any decision

of this Court or any other court.

In essence, petitioner’s argument is that the phrase

“properly maintained” used in Section 207(cX1) of the

Clean Air Act, 42 U.S.C. 1857-5a(c)(1), was intended to

bar recall of cars failing to maintain emission standards

where such failure is due to misadjustments, even though

the misadjustments are attributable to the manufacturer’s

design defects. This argument was correctly rejected by

the court of appeals, in a thorough opinion on which we

rely,

After carefully reviewing the language, history and

purpose of the statute, the court of appeals affirmed the

Administrator’s interpretation of “properly maintained”

as used in Section 207(c\1) (Pet. App. 40a-5la).§ The

court disagreed with petitioner's contention that “properly

maintained” must necessarily be interpreted as referring to

the requirement, in the warranty provision of the statute

(Section 207(b)2XA), 42 U.S.C. 1857f-5a(b)(2)A)), that

the vehicle be maintained in accordance with the

manufacturer’s written instructions furnished with each

‘Citing Harrison v. PPG Industries, Inc., No. 78-1918 (May 27,

1980), petitioner contends (Pet. 14) that the court of appeals and the

Administrator erred in going beyond the statutory language to

examine the statute’s history and purpose. But the Court in Harrison

concluded that in the absence of legislative history to the contrary,

there was no need to construe the statute in a manner inconsistent

with its plain language. Slip op. 10. Here, the court below concluded

that the statutory language was open to several plausible inter-

pretations, and that the history and purpose of the legislation

supported the view that Congress intended manufacturers to be liable

for recall if the design defects of the manufacturer were responsible

for poor maintenance resulting in emission standard violations.

new vehicle pursuant to Section 207(cX3), 42 U.S.C.

1857f-Sa(c\3) (Pet. App. 4la-44a). The court noted (id. at

42a) that, unlike Section 207(b\2)A), Section 207(c)(1)

does not expressly refer to the manufacturer’s

instructions. It also observed that there are significant

differences between a warranty action and a recall action

and that, in light of these differences, Congress may have

intended the “properly maintained” language applicable

to recall actions to be given a more flexible interpretation

than the maintenance requirement under the warranty

provision (Pet. App. 42a-43a). In addition, the court

pointed out that the phrase “when in actual use” in

Section 207(cX1) suggests that Congress was concerned

with everyday conditions, and that if—as the

Administrator found—Chrysler’s design and maintenance

procedures encouraged or fostered improper maintenance,

the Administrator was not precluded by Section

207(bX 2A) from ordering a recall (Pet. App. 44a).’

Turning to the history and purpose of the statute, the

court noted that the recall provision was added to the

Clean Air Act in 1970 “to give auto manufacturers an

incentive to design and construct their emission control

systems to meet standards in actual use” (Pet. App. 49a).

Before that date, the Act required only production and

prototype tests (id. at 44a-45a). The court concluded that

the “properly maintained” language was incorporated in

%in support of its arguinent, petitioner cites (Pet. 11, 13) an opinion

of EPA's General Counsel issued in 1972 and recently published. |

United States Environmental Protection Agency, General Counsel

Opinions, “Air Pollution” 105, 111 (1979). That opinion, however,

does not address the question whether a vehicle is not “properly

maintained” under Section 207(c\1) if, as the Admigistrator found in

this case, the faulty maintenance is the “inevitable byproduct” (Pet.

App. 82a) of the manufacturer's defective system design and

maintenance procedures.

9

the recall provision of the statute to free the manufacturer

of the financial burden of a recall when the failure to meet

emission standards was caused by reasons beyond the

manufacturer’s control (id. at 44a-Sla). However, the

language was not intended to relieve the manufacturer of

liability whenever owners had failed to maintain their cars

strictly in accordance with the manufacturer’s precise

written instructions, regardless of the underlying reasons

for the maintenance failures. Where, as here, the

manufacturer was in fact responsible for the defects that —

ultimately caused the maintenance failures, the court

decided that the manufacturer may be held responsible

under the Act. We submit that this interpretation is a fair

and reasonable reading of the Act’s recall provision.

Finally, as the court of appeals observed (Pet. App.

49a-50a), if petitioner’s interpretation were accepted, auto

manufacturers would have little incentive to design

emission systems that would operate effectively while in

actual use. “The manufacturer could prescribe

maintenance that is difficult to perform or incompatible

with smooth operation of the vehicles, but bear no

responsibility for the natural consequence of such

desigun—so long as the vehicles passed the initial

certification tests. We could expect little or no progress in

development of better, more maintenance-free emission

controls” (id. at 50a).

7%

10

CONCLUSION

The petition for a writ of certiorari should be denied.

Respectfully submitted.

WADE H. McCreg, JR.

Solicitor General

JAMES W. MOORMAN

Assistant Attorney General

DONALD W. STEVER, JR.

CHARLOTTE URAM

Attorneys

NOVEMBER 1980

DOJ-1980-11