Petitioners Brief — United States v. Stauffer Chemical Co.

Office-Supreme Court, U.S.

FILED

No. 82-1448

In the Supreme Court of the wtiteO" Sates"

OCTOBER TERM, 1982

UNITED STATES OF AMERICA, PETITIONER

Vv.

STAUFFER CHEMICAL COMPANY

ON WRIT OF CERTIORARI TO

THE UNITED STATES COURT OF APPEALS FOR

THE SIXTH CIRCUIT

BRIEF FOR THE UNITED STATES

REX E. LEE

Solicitor General

MARY L. WALKER

Acting Assistant Attorney General

Louis F, CLAIBORNE

Deputy Solicitor General

JOSHUA I, SCHWARTZ

Assistant to the Solicitor General

DirK D. SNEL

JUDSON W. STARR

KATHLEEN P. DEWEY

Attorneys

Department of Justice

Washington, D.C. 20530

(202) 633-2217

A. JAMES BARNES

Acting General Counsel

CHRISTOPHER C. HERMAN

Attorney

Environmental Protection Agency

Washington, D.C. 20460

QUESTIONS PRESENTED

1, Whether the United States may be collaterally

estopped from litigating a question of statutory interpreta-

tion of public importance governing the relationship be-

tween a federal agency and members of a large class of

businesses subject to the agency’s jurisdiction by the judg-

ment of the court of appeals for a different circuit rendered

in a different case involving the same private party but

arising from a separate transaction at a different location.

2. Whether a contractor, retained by the Environmental

Protection Agency specifically for the purpose, qualifies as

an “authorized representative” of EPA’s Administrator en-

titled to participate in agency inspections of stationary

emission sources pursuant to Section 114(a)(2) of the Clean

Air Act, 42 U.S.C. (Supp. V) 7414(a)(2).

(1)

TABLE OF CONTENTS

“ Page

src LUL Cis clas Ohaeias ite ssvaaces ds l

ER ee Se Vian Sh aaise yon oe Gly ds kai eeb bck l

ECU AGEs a dee ss sli deide chaian ac hs l

EE TET eh Cl Sag Soidupiw bases vd 40s sae 2

Summary of argument ......cccccccccccccccececs ll

Argument:

I, The United States may not be collaterally

estopped from litigating a question of stat-

utory interpretation by the adverse judg-

ment of the court of appeals for a different

circuit in an unrelated case ............. 15

A. Collateral estoppel is inapplicable to an

unmixed question of law arising in suc-

cessive cases related only by the pres-

ence of that question and the presence,

in each, of the party invoking the rule

IE Sc el Uabscyanebicceccuss 15

B. Collateral estoppel should not be ap-

plied against the government to pre-

clude determination of recurring ques-

CE Oe RN. ne tn daca ccccvrees 22

C. Identity of parties in successive cases

does not justify application of collateral

estoppel on recurring questions of pub-

MOE chicas sUiuebsecuvebensiecers 26

D. Other considerations weigh against ap-

plication of collateral estoppel in the

patties OF CHES GREE: ccivccccccccccnses 31

II], Under Section 114(a)(2) of the Clean Air

Act, a contractor designated as an “au-

thorized representative” by the EPA Ad-

ministrator may participate in agency in-

spections of stationary air pollution

SNE, Sa Sse hee Nee veNaeea Usbceseabuetien 33

IV

A. Statutory language and legislative

history indicate that the Administra-

tor is authorized to secure contractor

assistance for stationary source

MOURNS | a ccdccedeatcdpvcnnancesus 33

B. Sufficient safeguards exist to protect

against improper disclosure of trade

CRP: os avcnsccancubduetetdsinesevces 46

CGI Nc viasusvassuscndenescgecepesnseenes 47

PORE Sic cicccissccncedecautecchecsbsevabaee la

TABLE OF AUTHORITIES

Cases:

Aluminum Co. of America v. EPA, No.

M-30-13 (M.D.N.D. Aug. 5, 1980) .......... 4

American Medical International, Inc. v. See-

retary of HEW, 677 F.2d 118 .... 18, 28, 26, 27, 28

Bernhard vy. Bank of America Nat'l Trust &

Savings Ass'n, 19 Cal. 2d 807,

SE oa a new an Rkddeeweantateent 17

Blonder-Tongue Laboratories, Inc. v. Univer-

sity of Illinois Foundation, 402 U.S. 313 ... 17

Bowen v. United States, 422 U.S. 916 ....... 30

Bunker Hill Co. v. EPA, Civ. No. 80-2087 (D.

Idaho Oct. 15, 1980), affd, 658 F.2d 1280 .. 4, 8,

10, 11, 16, 34, 41

Califano v. Yamasaki, 442 U.S. 682 ......... 18

Caminetti v. United States, 242 U.S. 470 .... 33

Consumer Product Safety Commission v. GTE

Sylvania, Inc., 447 U.S. 108 .....ceccseees 42

Divine v. Commissioner, 500 F.2d 1041 ..... 26

E.1, du Pont de Nemours & Co. v. Train, 430

TAM WEEE Chane uo odaeke tapas cuebaestaadean 18, 31

EEOC vy. Wyoming, No. 81-554

i en -cclavekacaccerek twaeebubeks 40

EPA vy. National Crushed Stone Ass’n., 449

RMN CIE oa du sbwddiediee de duanah de manana 44

Cases—Continued: Page

Frock vy. United States Railroad Retirement

Béard, G06 F.B6 2061 6c. cecccvcccsecses 18

Gulf Oil Corp. v. Copp Paving Co., 419 U.S,

| MPTP TTTiT ir 40

Harrison v. PPG Industries, Inc., 446 U.S

FTE ccccccscnecaseveceneacesnexnaneneuuns 40

INS v. Dit, G4 Gb. © ccccucccvnswetatees 23

Mohasco Corp. v. Silver, 447 U.S, 807 ....... 35

Montana vy. United States, 440 U.S, 147 .... passim

NLRB vy. Amaz Coal Co., 453 U.S. 322 ..... 34

New Jersey Department of Environmental

Protection v. EPA, 626 F.2d 1088 ......... 32

Olegario v. United States, 629 F.2d 204, cert.

Gone, GO U.S. GOO sceccsienediscdcveceves 26

Parklane Hosiery Co. v. Shore,

430 UB. TER a ccvisvevcvsccsvevveces 17, 21, 22, 31

Reiter v. Sonotone Corp., 442 U.S, 330 ...... 35

Republic Steel Corp. v. Costle, 621 F.2d 797 . 32

Sharon Steel Corp. v. EPA, 597 F.2d 377 .... 32

Standefer v. United States, 447 U.S. 10 ...... 23

Stauffer Chemical Co., In re, 14 Env’t Rep.

Cas. (BNA) 1737, aff'd, 647 F.2d 1075 .3, 4, 16, 38

Steele v. United States No, 2, 267 U.S. 505 .. 38

Train v. NRDC, i UB. Gc ccceccnevcsess 31, 44

Triplett v. Lowell, 297 U.S. 688 ..........55. 17

Udall v. Tallman, 380 U.S. 1 ....cceeeeeeess 44

Union Electric Co. v. EPA, 427 U.S. 246 .... 31, 44

United States v. American Trucking Ass'ns,

$90 U.S. GOR «i csicccvasduetesveseecsneee 35

United States v. Gannon, 201 F. Supp. 68 ... 38

United States v. Moser, 266 U.S. 236 .... 6, 11, 15,

16, 19

United States v. Rutherford, 442 U.S. 544... 37, 42

VI

Cases—Continued: Page

United States Steel Corp. v. EPA, 595 F.2d

207, modified, 598 F.2d 915 ............... 32

United States Steel Corp. v. EPA, 605 F.2d

283, cert. denied, 444 U.S. 1035 ........... 32

United States Steel Corp. v. EPA, 649 F.2d

GM TLNE GATE wd sae so daes ses ae ss sceneed' 32

United States v. Turkette, 452 U.S. 576 ...... 33

Western Oil & Gas Ass'n v. EPA, 633 F.2d

1 7, 26, 31

Statutes, regulations and rules

Clean Air Act, 42 U.S.C. (Supp. V)

EE Cris cc bhediesieeceovecescoecess 2

Section 101, 42 U.S.C. (Supp. V)

EEE xu ws beets cove svseceenvaed 33

Section 107, 42 U.S.C. (Supp. V) 7407 ... 2

Section 108(j), 42 U.S.C. (Supp. III 1964

MP TMI) se vcccesscccccccssccccece 39

Section 207(a), 42 U.S.C. (Supp. III 1964

TIED 6 cccnccrvsvseonssescese 39

Section 109, 42 U.S.C. (Supp. V) 7409 ... 2

Section 110, 42 U.S.C. (Supp. V) 7410 ... 2

Section 112, 42 U.S.C. (Supp. V) 7412 ... 2

Section 114, 42 U.S.C. (Supp. V) 7414 ... 1,9,

14, 28, 33, 39, 41, 46, la

Section 114(a), 42 U.S.C. (Supp. V)

SOE 33

Section 114(a)(1), 42 U.S.C. (Supp. V)

IY wk'oig sé 40cces000sden (sees 33

Section 114(a)(2), 42 U.S.C. (Supp. V)

ee eee passim

Section 114(c), 42 U.S.C. (Supp. V)

es oan aed panes 9, 13, 14, 35, 36,

38, 44, 46

Section 114(d), 42 U.S.C. (Supp. V)

PRR kaa 9, 13, 36, 37, 39

Section 206, 42 U.S.C. (Supp. V) 7525 ... 41

Section 206(c), 42 U.S.C. (Supp. V)

OS re 41

Vu

Statutes, regulations and rules—Continued:

Section 208, 42 U.S.C. (Supp. V) 7542(a) .

Section 301, 42 U.S.C. (Supp. V) 7601 ...

Section 307(b)(1), 42 U.S.C. (Supp. V)

A aay EA CoS aye a

Clean Air Act Amendments of 1977, Pub. L.

No. 95-95, Section 113, 91 Stat. 709 ........

Clean Water Act, 33 U.S.C. 1251 et seq.:

Section 308, 33 U.S.C. (& Supp. V) 1318 .

Section 308(a)(B), 33 U.S.C. (& Supp. V)

ena GaSe Sia es ieee Nskcaee es

Section 509(b), 33 U.S.C. 1369(b) ........

Comprehensive Environmental Response Com-

pensation and Liability Act of 1980, Pub. L.

No. 96-510, 94 Stat. 2767, 42 U.S.C. (Supp.

Me PEI Wearside ees cnc eedaus bays.

Economic Stabilization Act of 1970, Section

211(bX1), 18 U.S. 1904 note .....cccccccces

Solid Waste Disposal Act, 42 U.S.C. 6921 et

seq.:

Section 3007, 42 U.S.C. (Supp. V) 6927...

Section 3007(a), 42 U.S.C. (Supp. V)

Pek Gu tint cian etc ebous een om +

Surface Mining Control and Reclamation Act of

1977, Section 526(a)(1), 30 U.S.C. (Supp. V)

NEE ease Va vet Soni napavesskcubbas sax

Pe EE hc ivectaeseedecedaveces ees

EAA G6 bin bs soe ae nen dese hee sense

40 C.F.R.:

I I ek ea

Section 2.301(h)(2)(iiNC) ..........00000,

41 C.F.R.:

I RU ee ee te

NN RUN oe a eS be

Page

41

36

31, 32

36

10

42

31

42

32

46

46

Vill

Statutes, reguletions and rules—Continued: Page

Sup. Ct. R.:

SS. Sea er me ar Pe ree key 19

A ae eer rrrrr rrr er i 25

Miscellaneous:

Agriculture—Environmental and Consumer

Protection Appropriations for 1973: Hear-

ings Before a House Subcomm. on Appropri-

ations of the Comm. on Appropriations, 92d

Cong., 2d Sess., Pt. 5, (1972)... se eeeeees 45

40 Fed. Reg. 21990 (1975) .....ceeeeeeeeeeees 45

43 Fed. Reg. 40007 (1978) .....eeeeeeeereeees 45

H.R. 172555, 91st Cong., 2d Sess. (1970)

Coy ste shen eareratekSeuscner ees 39

H.R. Conf. Rep. No. 95-564, 95th Cong., 1st

Baan (IDTT) cccccsvcvevertdccceceesnecsses 37

Legislative History of the Clean Air Act

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

(Comm. Print 1974) .....eceeeeeeeeeeereee 40

2 Moody’s Industrial Manual (1982) ........+. 29

Restatement (Second) of Judgments (1982):

UE ee ep cctencnsvs@encdaneeneees 15

§ 28, comment b .......eeeeeeereeeereee 21

§ 28, comment C .... sere eee ee ee eeeeeeee 17

§ 28(2) & comment C ....s sees eeeee eens 26

§ 28, illustration 1 ........+eeeeeeeeeeeee 18

§ 28, illustration 2 .......-seeeeeeeereees 18

SOP rrr errrrnrr tree) 19

§ 28, Reporter's Note ......eeeeeeereees 17, 21

§ 29, commenti ......-:eeeeereeeeereeee 26

Cee cc icikeceteuedsnaeacaencenes 26

S. 1480, 96th Cong., Ist Sess. (1979) ....+.--. 42

S, 4358, 91st Cong., 2d Sess. (1970) .......+-. 40

Second Supplemental Appropriations for Fis-

cal Year 1971: Hearings on H.R. 8191 Before

the Senate Comm. on Appropriations, 91st

Cong., Ist Sess. (1971) ..eeeeeeeee een enees 45

IX

Miscellaneous—Continued: Page

S. Rep. No. 92-414, 92d Cong., 2d Sess.

EASE ay ak a a ll

S. Rep. No. 96-176, 96th Cong., 2d Sess.

RS rr 44

S. Rep. No. 96-848, 96th Cong., 2d Sess.

EE Ne tathes KiebNekebabuceeseneseese ss 43

Vestal, Relitigation by Federal Agencies: Con-

flict, Concurrence and Synthesis of Judicial

Policies, 55 N.C.L. Rev. 123 .............. 18

Webster's Third New International Dictionary

a a Se 34

In the Supreme Court of the Anited States

OCTOBER TERM, 1982

No, 82-1448

UNITED STATES OF AMERICA, PETITIONER

v.

STAUFFER CHEMICAL COMPANY

ON WRIT OF CERTIORARI TO

THE UNITED STATES COURT OF APPEALS FOR

THE SIXTH CIRCUIT

BRIEF FOR THE UNITED STATES

OPINIONS BELOW

The opinion of the court of appeals (Pet. App. la-4la) is

reported at 684 F.2d 1174. The court of appeals’ order upon

denial of a petition for rehearing (Pet. App. 42a-43a) is re-

ported at 684 F.2d 1193. The opinion of the district court

(Pet. App. 44a-56a) is reported at 511 F. Supp. 744.

JURISDICTION

The judgment of the court of appeals (Pet. App. 57a-58a)

was entered on July 7, 1982, and a timely petition for re-

hearing was denied on October 15, 1982 (Pet. App.

42a-43a), On January 3, 1983, Justice O'Connor extended

the time for filing a petition for a writ of certiorari to and

including February 27, 1983, a Sunday. The petition was

filed on February 28, 1983, and was granted on April 18,

1983, The jurisdiction of this Court is invoked under 28

U.S.C. 1254(1).

STATUTE INVOLVED

Pertinent portions of Section 114 of the Clean Air Act, 42

U.S.C, (Supp. V) 7414 are set out in an Appendix to this

brief.

(1)

2

STATEMENT

This case arises from respondent’s challenge to use of a

contractor-representative designated by the United States

Environmental Protection Agency (“EPA”) to provide tech-

nical assistance to EPA employees in conducting an inspec-

tion of a stationary emission source under Section 114(a)(2)

of the Clean Air Act, 42 U.S.C. (Supp. V) 7414(a)(2), The

district court held that the Administrator’s statutory au-

thority to employ “authorized representative(s]” in such in-

spections was broad enough to permit use of such specially

retained contractors, The court of appeals reversed. With

each member of the panel writing separately, concurrent

majorities held alternatively: (1) that the United States is

collaterally estopped from advancing its interpretation of

the statutory language, having lost the issue in litigation

involving a different plant operated by respondent in the

Tenth Circuit, and (2) that Section 114(a)(2) does not per-

mit the agency’s specially designated contractor-represent-

atives to enter the premises of stationary emission sources

for the purpose of measuring emissions from such sources.

1. In early 1980 EPA contracted with PEDCo Environ-

mental, Inc, to assist with technical aspects of an overview

inspection of an elemental phosphorus production plant op-

erated by respondent located in Mt. Pleasant, Tennessee.!

' The Clean Air Act, 42 U.S.C, (Supp. V) 7401 et seg., establishes a

dual state-federal system of air pollution enforcement. EPA estab-

lishes national ambient air quality standards, 42 U.S.C. (Supp. V)

7409, while the states are primarily responsible for enforcing these

standards, subject to EPA's supervision and approval, 42 U.S.C,

(Supp. V) 7407, 7410, 7412. In order to carry out its oversight role

EPA employs its Section 114(a)(2) inspection authority to conduct an

“overview inspection program” under which it inspects approximately

10% of the major stationary sources of air pollution within each state

annually, These sources are also inspected by state authorities that

submit reports to the EPA, The results of each overview inspection

are compared with the results of the state inspection. A primary pur-

pose of the overview inspection program is to facilitate evaluation of

each state's performance in enforcing the Clean Air Act, thereby

enabling EPA to determine whether additional federal enforcement ef-

fort may be warranted,

3

EPA officials attempted to inspect respondent's Mt. Pleas-

ant plant on March 27, 1980. When EPA personnel, accom-

panied by representatives of the Tennessee Department of

Public Health and PEDCo personnel retained by EPA,

arrived at the plant, respondent denied entry to the two

PEDCo employees. In ensuing negotiations, respondent at-

tempted to condition admission of PEDCo personnel upon

EPA and PEDCO’s adherence to terms respondent had

fixed. In addition to confidentiality requirements and provi-

sions for damages in the event of any breach, the agree-

ment proposed by respondent would have afforded it abso-

lute authority to determine the areas of the plant to be

inspected by EPA, and would have required two weeks’ ad-

vance notice of any inspection (Pet. App. 6a, 45a). EPA

deemed these provisions unacceptable,

Thereafter, gn August 7, 1980, EPA secured a warrant

from a United States magistrate authorizing inspection of

respondent's Mt. Pleasant, Tennessee facility. The warrant

covered inspections by EPA employees and “accompanying

authorized representatives under contract to EPA.” EPA

and state officials, again accompanied by a PEDCo employ-

ee, again attempted to inspect respondent's Mt. Pleasant

phosphorus plant pursuant to the warrant. Respondent

again refused to permit a PEDCo employee to assist in the

inspection of the plant unless its restrictive conditions were

accepted by EPA and the contractor.

2. The following day, August 8, 1980, EPA moved to

have respondent held in civil contempt by the United

States District Court for the Middle District of Tennessee

for its refusal to honor the warant. Respondent countered

with a motion to quash the warrant. Respondent argued

that Section 114(aX2) of the Clean Air Act, which empowers

the EPA Administrator “or his authorized representative”

to enter upon the premises of stationary pollution sources

to sample emissions, does not sanction entry by contractors

retained by EPA to assist in such inspections.? The op-

® Although the statutory question had, by the date of the hearing on

its motion to quash, been decided in its favor in separate litigation

involving a different plant, see Jn re Stauffer Chemical Co. 14 Env't

Rep. Cas. (BNA) 1737 (D. Wyo. 1980) (first alternative holding), re-

4

posed applications were consolidated for hearing. On April

17, 1981, the district court denied the motion to quash,

Based upon consideration of the statutory language in is-

sue, language of related provisions of the Clean Air Act,

and pertinent legislative history, the court held that the in-

spection authority granted to “authorized representa-

tive[s]” of the EPA Administrator by Section 114(a)(2) in-

cludes properly retained contractors (Pet. App. 44a-55a).°

Because respondent's noncompliance with the warrant was

based upon its good faith “belie[f] that private contractors

were not authorized representatives” under the Clean Air

Act, however, EPA’s contempt motion was denied, without

prejudice to its renewal in the event respondent persisted

in its refusal to honor the warrant (id. at 56a).

3. On appeal, in addition to the merits of the question of

statutory interpretation presented, respondent argued, for

the first time, that the decision in Jn re Stauffer Chemical

Co., 14 Env’t Rep. Cas. (BNA) 1737 (D. Wyo. 1980), aff,

647 F.2d 1075 (10th Cir. 1981) (“Stauffer I"), collaterally

estops the United States from contending that the term

spondent did not argue in district court that the Wyoming district

court's decision was to be given preclusive effect. A second decision,

contrary to the Wyoming district court's, had, prior to submission of

this case to the district court, been rendered in a case to which respon-

dent was not a party. See Aluminum Co. of America v. EPA, No.

M-30-13 (M.D.N.D. Aug. 5, 1980). After submission but prior to entry

of the district court's decision in this case, a third district court deci-

sion, likewise supporting EPA's position, was rendered, Bunker Hill

Co. v. EPA, Civ. No, 80-2087 (D. Idaho Oct. 15, 1980).

* The district court concluded that the confidentiality provisions of

EPA's contract with PEDCo and PEDCo’s agreement with its employ-

ees, together with the pertinent EPA regulations, were sufficient to

dispel any concern about improper disclosure of proprietary business

information by contractor personnel, in the absence of any evidence

that PEDCo is in competition with respondent in any business (Pet.

App. 53a-55a).

In the district court respondent also argued that EPA may not se-

cure administrative warrants on an ex parte basis. The district court

rejected this argument (Pet. App. 55a-56a), and although respondent

preserved the argument on appeal (see id. at 3a), the court of appeals

did not reach it. No issue respecting the procedure for issuance of a

warrant is presented here.

5

“authorized representative” employed in Section 114(a)(2)

includes a duly designated EPA contractor. Compare page

3 note 2, supra. Stauffer I addressed the legal question at

issue in this case, but arose from respondent’s motion to

quash an administrative warrant, issued on May 8, 1980,

authorizing EPA and two employees of a different

contractor-representative to carry out an oversight inspec-

tion of respondent’s phosphate ore processing plant in Sage

County, Wyoming. The Wyoming district court had held in

Stauffer I that Section 114(a)(2) does not authorize the

EPA administrator to retain contractor personnel to assist

in inspections of stationary sources of air pollutants and

permanently enjoined EPA from using such contractor per-

sonnel in any inspection of any of respondent’s plants lo-

cated in Wyoming absent respondent’s consent. Shortly af-

ter the entry of the district court’s decision in the instant

case, the United States Court of Appeals for the Tenth Cir-

cuit affirmed the district court’s judgment in Stauffer /, al-

beit while cautioning that the issue was not “an open and

shut matter” and acknowledging that under its decision the

Clean Air Act is “not entirely internally consistent.” 647

F.2d at 1079.

An unusually fragmented court of appeals reversed the

devision of the district court in this case (Pet. App. la-41a).

While each member of the panel concurred in the judgment,

the reasoning of each judge was distinct, and each wrote

separately. Judge Weick delivered what was characterized

(id, at la) as the opinion of the court (id. at 1la-33a).

But see page 6 note 4, infra. Although he “agree(d]

with Stauffer that the action is governed by estoppel and

res judicata” and that it was therefore “unnecessary to

reach other issues,” Judge Weick went on to reach the mer-

its “because they were briefed by both parties,” (id. at 4a),

concluding that Section 114(a)(2) does not permit EPA con-

tractors to participate in inspections of stationary pollution

sources. Judge Jones joined only Judge Weick’s discussion

of collateral estoppel, stating that “the application of the

doctrine precludes this Court from addressing the merits of

the issue pressented” (id. at 34a). District Judge Siler (sit-

ting by designation), on the other hand, joined only Judge

6

Weick’s opinion on the merits of the statutory interpreta-

tion question, concluding that “the doctrines of collateral

estoppel and res judicata should not be applied here” (id. at

39a). Thus both branches of Judge Weick’s opinion spoke

for a majority of the court, and the judgment of the court of

appeals rests upon alternative holdings.‘

a. Collateral Estoppel—Because “the parties as well as

the issues of fact and law in the present case and Stauffer /

were identical” (Pet. App. lla), Judge Weick concluded

that the doctrine of collateral estoppel described in Mon-

tana v. United States, 440 U.S. 147, 153-154 (1979), was

controlling (Pet. App. 8a-13a). He concluded, moreover,

that the “unmixed questions of law” exception to the rule of

preclusion noted in Montana (440 U.S. at 162, quoting

United States v. Moser, 266 U.S. 236, 242 (1924)) was inap-

posite, characterizing the case as one governed by a “ ‘fact,

question or right distinctly adjudged’ ” in Stauffer /, rather

than an application of “ ‘a rule of law [enunciated] * * * in

a [previous] action upon a different demand’ ” (Pet. App.

12a-13a, quoting United States v. Moser, supra, 266 U.S.

at 242). Finally, Judge Weick condemned the government's

effort to “relitigate[ ]” (Pet. App. 12a) the issue decided in

Stauffer I stating (ibid; emphasis added) that the govern-

ment’s persistence

brings up the question, how many times does the gov-

ernment have to lose a case before either the doctrines

of collateral estoppel or res judicata are applied? If we

were dealing with private parties rather than the gov-

ernment, there would be no question about it. Jf EPA

really believed the decision of the Tenth Circuit in

Stauffer I was wrong, it could have petitioned the Su-

preme Court for certiorari, but it did not avail itself of

that remedy, and it is too late to do so now. EPA can-

not collaterally attack the Tenth Circuit decision in

the present case.

On the other hand, Judge Siler concluded that collateral

estoppel had no application in this case (Pet. App. 39a-41la).

He stressed that the “federal appellate courts ‘traditionally

* Judge Weick’s reasoning that, notwithstanding the application of

collateral estoppel, the merits should be addressed was his alone.

-

have permitted federal agencies to relitigate substantially

identical legal issues raised by different transactions or

events, after adverse decision elsewhere’” (id. at 40a,

quoting Western Oil & Gas Ass'n v. EPA, 633 F.2d 808,

808 (9th Cir. 1980); emphasis the Ninth Circuit’s). Judge

Siler also observed that the issue preclusion rule was not to

be applied so as to create injustice. He explained that injus-

tice would result from application of collateral estoppel “if

EPA were precluded from entering with private contrac-

tors at Stauffer’s plant in Tennessee, but were using pri-

vate contractors in entering competitor’s plants in the same

area.” (Pet. App. 40a-4la). Judge Siler concluded, more-

over, that (ibid.):

where several different cases involving the same is-

sues are being litigated simultaneously in separate cir-

cuits, collateral estoppel should not be invoked.

Judge Jones wrote separately on the collateral estoppel

issue, explaining his concurrence in that branch of the

court’s opinion (Pet. App. 34a-38a). Judge Jones recognized

(id. at 35a) that under Mentana vy. United States, supra,

collateral estoppel is not to be applied where “controlling

facts or legal principles have changed significantly” since

the judgment in a prior case, or where “other special cir-

cumstances warrant an exception to the normal rules of

preclusion” (440 U.S. at 155). In Judge Jones’ view, how-

ever, neither of these exceptions was applicable here (Pet.

App. 35a-35a). He discounted Judge Siler’s concern that ap-

plication of collateral estoppel would foster uneven applica-

tion of the law to parties similarly situated, suggesting that

application of different rules of law to respondent’s facilities

in different locations would create a more substantial ineq-

uity. And even though he had concluded that, given the ap-

plicability of collateral estoppel, it was improper for the

court of appeals to reach the merits (id. at 34a), Judge

Jones observed that because the other two members of the

panel had reached the merits, the inequity that troubled

Judge Siler was “illusory.” He explained: “(T]he stare

decisis impact of the Court’s holding today, if it becomes fi-

nal, may be expected to eliminate the practice [of contrac-

tor-assisted inspections] in this jurisdiction” (id. at 37a; ei-

8

tation omitted). Finally, while Judge Jones agreed with

Judge Siler that federal agencies ordinarily should be able

to litigate controlling legal issues in more than a single cir-

cuit, he thought that rule inapplicable where the non-

government parties in two cases are identical, at least

where “the same defendant is sued in seriatim without the

agency attempting to exhaust its appeals on the previous

judgment” (id. at 37a, 38a).

b. Interpretation of Section 114(a)(2)—Writing for him-

self and Judge Siler, Judge Weick turned to the underlying

question of statutory interpretation (Pet. App. 13a-33a). At

the outset, Judge Weick acknowledged that the proper in-

terpretation of the statute was not free from doubt, and

that under his interpretation internal inconsistencies in the

Clean Air Act remained (id. at 16a-7a).5 He also recognized

(id. at 15a-16a) that the decision of the Tenth Circuit in

Stauffer I that he followed was directly contrary to the de-

cision of the Ninth Circuit in Bunker Hill Co. v. EPA, 658

F.2d 1280 (9th Cir. 1981). Nevertheless, Judge Weick con-

cluded that Section 114(a)(2) of the Clean Air Act does not

permit contractors designated as EPA representatives to

assist agency employees in carrying out the inspections of

stationary pollution sources authorized by the statute.

The court of appeals initially rejected EPA’s contention

that the plain meaning of the term authorized “representa-

tive” extended to contractor-representatives designated by

EPA (Pet. App. 17a). The court also declined to assign any

weight to Congress’ adoption, in 1970, of the broad lan-

guage “authorized representative” from the Senate version

of the Clean Air Act Amendments bill in preference to the

narrower term “officers or employees” contained in the

analogous provision of the House Bill because the respec-

tive legislative reports do not address the present question.

The court of appeals observed, as well, that the Conference

Report made no mention of any difference between the two

formulations and actually summarized the provisions of the

alternative bills in nearly identical terms (i.e., authorizing

* Judge Siler similarly acknowledged the district court’s decision on

the Section 114(a)(2) issue was not clearly incorrect (Pet. App. 41a).

)

entry and inspection by “DHEW investigative personnel”

as opposed tou “DHEW personnel”).® The court therefore

concluded that Congress intended the term “authorized

representative” to serve as a synonym for the terms “offi-

cers or employees” (Pet. App. 17a-20a).

In addition, the court ofePpeals reasoned that Section

114(d) of the Act, 42 U.S.C. (Supp. V) 7414(d), added by

1977 amendments, which requires “the Administrator (or

his representatives)” to give notice to the state air pollution

control agency before making an inspection under Section

114(aX(2), supports respondent's restrictive reading of the

term representative as employed in the latter section. The

court suggested that Congress could not have entrusted

“this kind of sensitive intergovernmental communication to

employees of private contractors,” and concluded that the

term “authorized representatives” used in Section 114(a)(2)

should be given'a similarly narrow reading (Pet. App.

20a-21a). The court of appeals rejected the district court's

contrary observation (see Pet. App. 47a-48a) that Section

114(a)(2) should be read in conformity with Section 114(c).

The court of appeals did not dispute that Section 114(c) au-

thorizes the Administrator to disclose confidential business

information learned during Section 114(a)(2) inspections to

EPA contractor-representatives engaged in carrying out

provisions of the Act. (Pet. App. 21a). But the court

thought to harmonize all three provisions of Section 114 as

follows (id. at 22a):

(T]he word “representative” as used in Section 114 of

the Clean Air Act means EPA officers or employees,

unless the latter are already enumerated, as they are

in Section 114(c). In that event, the plain meaning of

“representative,” i.e., one standing or acting for an-

other through delegated authority, controls.

The court recognized that, under its interpretation, the

term representatives is used in Section 114 in two different

senses, but it thought this result unavoidable (Pet. App.

* At the time in question, EPA had yet to be created, and the Secre-

tary of Health, Education, and Welfare was charged with administra-

tion of the Clean Air Act.

10

22a). The court also believed that if the term “representa-

tive” employed in Section 114(a)(2) denoted persons other

than EPA employees, the Administrator could make in-

spections of stationary pollution sources only in person or

through persons other than agency employees (ibid.),

Unlike the district court (see Pet. App. 48a-50a) and the

Ninth Circuit (see Bunker Hill Co. v. EPA, supra, 658

F.2d at 1284), the court of appeals attached substantial

weight to post-enactment legislative history respecting the

1972 Amendments to the Clean Water Act (Pet. App.

26a-29a).7 The court reasoned that the timing and author-

ship of the Senate report on Section 308 of the Water Act

lent substantial authority to the views expressed respect-

ing previously enacted provisions of the Clean Air Act (id.

at 28a). In any event, the court thought it “anomalous” (id.

at 29a) that contractor assisted inspections be permitted

under the Clean Air Act, but not under analogous provi-

sions of the Clean Water Act (ibid.).

Finally, the court of appeals relied (Pet. 29a-30a) upon a 1980

amendment to inspection provisions of the Solid Waste Dis-

posal Act, 42 U.S.C. (Supp. V) 6927(a), that added “repre-

sentative[(s]” duly designated by the EPA Administrator to

a list of persons—including agency employees and offi-

cers—previously authorized to make such inspections. The

legislative history of that amendment makes explicit Con-

gress’ intention to allow EPA contractor-representatives to

take part in inspections under the Solid Waste Disposal

Act. The court reasoned that the absence of comparable

language in the legislative history of Section 114(a)(2) of the

Clean Air Act indicates that Congress did not intend to

7 The pertinent portion of the Senate Report on the 1972 Amend-

ments to the Clean Water Act, S. Rep. No. 92-414, 92d Cong., 2d Sess.

63 (1971), states:

It should * * * be noted that the authority to enter, as under the

Clean Air Act, is reserved to the Administrator and his author-

ized representatives which such representatives must be full

time employees of [EPA). The authority to enter is not extended

to contractors with the EPA in pursuit of research and

development

1]

permit comparable assistance in stationary source inspec-

tions under the Clean Air Act.*®

SUMMARY OF ARGUEMNT

I

A. It has been settled, at least since L’nited States vy.

Moser, 266 U.S. 236, 242 (1924), that collateral estoppel

does not apply to questions of law arising between two par-

ties in successive, but unrelated actions. It is undisputed

that the underlying issue in this case is purely legal. Yet,

the court of appeals declined to apply the unmixed question

of law doctrine, invoking an exception to that rule applica-

ble to cases that are said to present the same “demand.”

This court has acknowledged (Montana vy. United States,

440 U.S. 147, 163 (1979)) that the scope of the Moser doc-

trine is “difficult to delineate.” But this much is clear: the

unmixed question of law rule, rather than the exception

thereto, must apply whenever successive cases are not sig-

nificantly related except for identity of parties and com-

monality of legal issues. Otherwise, the unmixed question

of law rule would itself be swallowed by its own exception.

This case and Stauffer IJ have no significant identity be-

yond the common issue and parties. The two cases arise

from unrelated inspections of different facilities. Moreover,

the two cases arise in separate circuits, which traditionally

have been permitted to develop their own views as to the

law based upon the cases before them, subject only to the

authority of this Court’s decisions. In any event, collateral

estoppel does not serve its usual purposes in a setting such

as this. The more flexible doctrine of stare decisis is suffi-

cient to assure that no improper advantages attach to

redetermination of legal issues in unrelated cases, and that

*The court of appeals also found inconclusive the evidence sup-

porting EPA's contention (previously accepted by the Ninth Circuit,

Bunker Hill Co. v. EPA, supra, 658 F.2d at 1284 n.2) that Congress

had ratified the agency’s interpretation of Section 114(a)(2), by its fail-

ure to disturb it in amending the Act in 1977 (Pet. App. 31a). The court

also found “doubtful” indications cited by EPA that Congress had

ratified the agency’s position by approving appropriations for contrac-

tor assistance (id. at 32a-33a).

12

unwarranted burdens are not placed upon litigants and the

courts. And there is little advantage to invocation of collat-

eral estoppel in terms of judicial economy, where, as here,

the issues are purely legal and have been addressed with

differing results by other courts of coordinate authority.

B. There are especially compelling reasons to eschew ap-

plication of collateral estoppel with respect to recurring

questions of law in government litigation. Reliance upon

collateral estoppel in such cases fails to respect the unique

public interest in rigorous enforcement of acts of Congress.

Because of the government’s presence in all such litigation,

it would also undermine the existing process of develop-

ment of the public law through selective appeals and resolu-

tion of conflicts, where necessary, by certiorari, freezing

the development of the law and transferring a substantial

caseload from the courts of appeals to this Court. The

broad rule of estoppel applied by the court of appeals also

would jeopardize the government's traditional self-restraint

in seeking appellate review, a practice that benefits all who

vie for a place upon the necessarily limited docket of this

Court.

C. The court of appeals did not quarrel directly with the

foregoing principles. Rather, it seems to have assumed that

they have no application when the parties to successive

cases are the same. But that approach would afford a party

that happened to be involved in a prior case presenting the

same legal question a favored position in the administration

of the law as compared with all others similarly situated.

As Judge Siler recognized (Pet. App. 40a-41a), if this case

were decided for respondent on the basis of collateral es-

toppel, respondent would have the benefit of a special rule

of law inapplicable to its competitors’ plants.

To be sure, refusal to apply collateral estoppel means

tolerating ad interim the existence of different rules of law

in different jurisdictions. But this possibility is a necessary,

and fundamentally desirable, concomitant of the structure

of the federal judicial system. The incidence of conflicts re-

sulting from the operation of that system should be rela-

tively low, moreover, for the courts of appeals remain free

to give the decisions of coordinate courts such weight as

13

their persuasive force warrants, and this Court remains

available to resolve conflicts among the circuits where nec-

essary. And where, as here, the decisions of the courts of

appeals were already in conflict before the court below

rendered its decision, uniformity of decision cannot be

achieved by recourse to issue preclusion.

The possible application of collateral estoppel to recur-

ring questions of law could confound the Solicitor General’s

process of screening adverse decisions to determine wheth-

er further review will be sought. Particularly when the is-

sue is whether certiorari should be sought, that decision

must continue to turn upon the existence of a conflict, and

the other criteria traditionally applied by this Court.

A. The court of appeals’ interpretation of Section

114(a)(2) of the Clean Air Act is contrary to all of the perti-

nent indications of legislative intent. The language of the

statute itself plainly extends the authority to participate in

inspections to all “authorized representatives” of the Ad-

ministrator; there is no hint that this authority is limited to

agency employees. Moreover, this reading is strongly sup-

ported by Section 114(c) of the Act, which authorizes disclo-

sure of information gathered in stationary source inspec-

tions to nongovernment personnel engaged in enforcement

of the Act.

The court of appeals, however, read Section 114(a)(2) in

conformity with what it took to be the meaning of Section

114(d) of the Act, which provides for certain intergovern-

mental notices. Reliance on Section 114(d) was

unwarranted. Unlike Sections 114(a)(2) and 114(¢), which

were enacted together in 1970, subsection (d) was added in

1977. Moreover, nothing in the legislative history or lan-

guage of Section 114(d) supports the restrictive reading

given that section by the court below. A fortiori, the court

erred in forcing Section 114(a)(2) into the mold created by

its own ipse dixit respecting subsection (d). The court of ap-

peals acknowledged (Pet. App. 22a) that it had assigned

14

disparate meanings to a single term—“authorized repre-

sentative” —that occurs twice in Section 114. That undesir-

able result is entirely unnecessary.

Nor is the decision below supported by the legislative

history. To the contrary, Congress adopted the broad lan-

guage of Section 114(a)(2) that extends authority to all of

the Administrator’s authorized representatives, choosing

this language, found in the Senate version of the bill, in

preference to language in the House Bill that limited in-

spection authority to agency employees. The decision of the

court of appeals thus undoes this congressional choice. That

Congress’ choice was deliberate is also evidenced by the re-

tention of the narrower formulation—“officers or employ-

ees” for the motor vehicle manufacturer inspection provi-

sions of the Act. And contrary to the view of the court

below, there is nothing irrational about the distinction thus

created.

The least that can be said in favor of the Administrator's

interpretation is that it is wholly reasonable and is not con-

trary to any evidence of legislative intent. In the circum-

stances, the court of appeals should have deferred to the

agency’s interpretation of the statute. The decision below,

by contrast, will handicap the agency’s enforcement of the

Clean Air Act, by precluding EPA from acquiring technical

assistance needed to carry out inspections of the wide vari-

ety of pollution sources in the most efficient manner

possible.

B. The court of appeals seems to have assumed that

EPA’s use of contractor-representatives entails undue risk

of general disclosure of trade secrets belonging to sources

subject to inspection. But Congress plainly did not share

this concern; Section 114(c) authorizes disclosure of such

proprietary information to agency contractors engaged in

tasks requiring such access. In any event, EPA’s regula-

tions, its contract with PEDCo, and PEDCo’s contract with

its employees, provide confidentiality safeguards and sanc-

tions for any improper disclosure that fully protect the in-

terest of respondent and others similarly situated.

15

ARGUMENT

I. THE UNITED STATES MAY NOT BE COLLATER-

ALLY ESTOPPED FROM LITIGATING A QUES-

TION OF STATUTORY INTERPRETATION BY

THE ADVERSE JUDGMENT OF THE COURT OF

APPEALS FOR A DIFFERENT CIRCUIT IN AN

UNRELATED CASE

A. Collateral Estoppel is Inapplicable to an Unmixed

Question of Law Arising in Successive Cases Re-

lated Only by the Presence of that Question and

the Presence, in Each, of the Party Invoking the

Rule of Preclusion

The court of appeals held that “[sJince the parties as well

as the issues of fact and law in the present case and

Stauffer I [are] identical” (Pet. App. 1la), the doctrine of

collateral estoppel described in Montana v. United States,

supra, 440 U.S. at 153-154, controls the result here (Pet.

App. 8a-12a). In the court of appeals’ view, “there [wa]s no

valid reason” (id. at 12a) why it should be required to ad-

dress the merits of the parties’ dispute in the case. In our

view, however, this case is governed by the exception to

the rule of collateral estoppel applicable to pure questions

of law arising in successive actions on substantially unre-

lated claims.

1. The Court defined the “unmixed question of law” ex-

ception to the rule of collateral estoppel in Montana v.

United States, supra, 440 U.S. at 162, quoting United

States v. Moser, supra, 266 U.S. at 242 (emphasis added by

the Montana Court):

Where * * * a court in deciding a case has enunciated

a rule of law, the parties in a subsequent action upon a

different demand are not estopped from insisting that

the law is otherwise, merely because the parties are

the same in both cases.

So, also, the Restatement (Second) of Judgments § 28, at

273-274(1982), provides in pertinent part:

Although an issue is actually litigated and determined

by a valid and final judgment * * * relitigation of the

issue in a subsequent action between the parties is not

precluded in the following circumstances:

16

” *x x = =

(2) The issue is one of law and (a) the two actions in-

volve claims that are substantially unrelated * * *.

The underlying question presented in this case is a pure

question of law entailing only an interpretation of Section

114(a\(2) of the Clean Air Act. The district court and the

court of appeals below agreed that the ultimate inquiry was

one of congressional intent. See Pet. App. 13a, 46a. And

both courts undertook to resolve that question by recourse

to the conventional tools of statutory interpretation: statu-

tory language, legislative history, examination of related or

analogous language, and canons of construction. Similarly,

both the Ninth Circuit and the Tenth Circuit have uniform-

ly treated the question as one of purely legal dimensions.

See Bunker Hill Co. v. EPA, supra, 658 F.2d at

1282-1284; Stauffer I, supra, 647 F.2d at 1077-1079. And

we must suppose that the court below shared that view

since it suggested (Pet. App. 12a) that the government, if

dissatisfied with the Tenth Circuit’s decision in Stauffer I,

should have sought this Court’s review of the Tenth Cir-

cuit’s judgment.

2. The court of appeals noted (Pet. App. 12a) this Court’s

caution that the “unmixed question of law” doctrine does

not apply in successive actions “upon * * * different de-

mand(s)" and does not permit

a fact, question or right distinctly adjudged in the

original action [to] be disputed in a subsequent action,

even though the determination was reached upon an

erroneous view or by an erroneous application of law.

Montana v. United States, supra, 440 U.S. at 162, quoting

United States v. Moser, supra, 266 U.S. at 242 (emphasis

the Montana Court’s). But the court below did not explain

why this case fell outside the unmixed question of law doc-

trine as thus limited. Rather, the court stated summarily

(Pet. App. 12a-13a):

Since the fact, question or right in the present case

was distinctly adjudged in Stauffer I the exception in

Moser is inapplicable here.

As this Court recognized in Montana (440 U.S. at 163),

“the scope of the Moser exception may be difficult to delin-

17

eate * * *.” And commentators have agreed that the line

between (permissible) relitigation of a common question of

law arising in successive actions and impermissible relitiga-

tion of “a fact, question or right” previously adjudged is not

a clear one. See Restatement (Second) of Judgments § 28,

comment c, at page 277; id. at 286 (Reporter’s Note). But

unless the unmixed question of law rule is entirely to be

abolished, a determination that successive actions present

the same “demand,” turn upon the same “fact, question or

right,” or are not “substantially unrelated,” must rest upon

something more than an identity of parties and of legal

issues—for those factors are necessarily present whenever

the predicate for application of the Moser doctrine exists in

a case litigated between parties that have previously liti-

gated a legal question. See Restatement (Second) Judg-

ments § 28, Reporter’s Note at 286 (collateral estoppel dis-

favored when two claims arise from'wyelated event[s] or

subject matter”).9

Yet the court of appeals identified no other respect in

which this case is related to Stauffer 1, and appears to have

relied entirely upon the identity of parties and the common

legal question. See Pet. App. lla-12a. In fact, Stauffer I

and the present suit are related in no other way. The two

cases arise out of different transactions—entirely unrelated

inspections of different industrial facilities that were to be

conducted with the assistance of different contractor-repre-

sentatives. The two facilities are located in different states,

and different EPA administrative regions. Each inspection

* Moser was decided long before the strict rule of mutuality of es-

toppel began to be eroded. See Parklane Hosiery Co. v. Shore, 439

U.S. 322 (1979); Bernhard v. Bank of America Nat'l Trust & Savings

Ass'n, 19 Cal. 2d 807, 122 P.2d 892 (1942); compare Blonder-Tongue

Laboratories, Inc. v. University of Illinois Foundation, 402 U.S. 313

(1971), with Triplett v. Lowell, 297 U.S. 638 (1936). The effect of the

court of appeals’ decision is thus to abolish the unmixed question of law

rule announced in Moser. Of course, now that the mutuality require-

ment has been relaxed, the unmixed question exception necessarily ex-

tends to situations where the parties in successive actions are not the

same. See Br. for the United States, at 20-25, United States v. Men-

doza, No. 82-849 (cert. granted, Jan. 24, casita (see page

22 note 12, infra).

18

arose out of the routine operation of EPA’s oversight in-

spection program. And so far as we are aware (and respon-

dent has not claimed otherwise) the fact that both inspec-

tions involve plants operated by respondent is pure

coincidence. See page 21 note 11, infra. The attempt to in-

spect respondent’s Mt. Pleasant, Tennessee facility com-

menced hefore the agency’s attempt to inspect the Sage

County, Wyoming plant. The cases arose on separate mo-

tions to quash two different search warrants issued by dif-

ferent federal courts. Thus, wherever the boundary of the

unmixed question of law exception may lie, this case falls

comfortably within it.1¢

For purposes of applying the unmixed question of law

rule, it is also significant that this case and Stauffer I arose

in different judicial circuits, which by tradition “can, and

do, differ in their conclusions as to the law.” Frock v.

United States Railroad Retirement Board, 685 F.2d 1041,

1046 (7th Cir. 1982). See American Medical International,

Inc. v. Secretary of HEW, 677 F.2d 118, 123 (D.C. Cir.

1981); see Vestal, Relitigation by Federal Agencies: Con-

flict, Concurrency and Synthesis of Judicial Policies, 55

N.C.L. Rev. 123, 140-163 (1977). This Court has repeatedly

recognized the value of independent consideration of legal

issues by the various courts of appeals. See, e.g., Califano

v. Yamasaki, 442 U.S. 682, 702 (1979); E.J. duPont de

Nemours & Co. v. Train, 430 U.S. 112, 135 & n.20 (1977).

‘© The examples employed in the Restatement to illustrate the scope

of the unmixed question exception are illuminating. In successive ac-

tions for trademark infringement for consecutive time periods between

identical parties, a judgment in the first action that the mark is invalid

because of widespread generic usage is said to be conclusive on the

same issue in a second action. By contrast, in successive personal inju-

ry damage actions against a municipality brought by a single plaintiff

based on separate tortious acts, a judgment for the municipality on

sovem@gn immunity grounds in the first action does not bar the plaintiff

from arguing in the second (subject only to the constraints of stare

decisis) that sovereign immunity should be rejected. Restatement

(Second) Judgments § 28, illustrations 1 and 2 at 276. In functional

terms this case resembles the later example, rather than the former,

for the only identity between this case and Stauffer @ lies in the identi-

ty of the parties and the legal issue.

19

Indeed, this Court’s practice in exercising its certiorari ju-

risdiction assumes the recurrence of conflicting legal con-

clusions by those courts. Sup. Ct. R. 17.1. Yet, under the

collateral estoppel rule adopted below, this Court, also,

could be precluded from resolving such a conflict after it

had arisen. Thus, it is especially inappropriate to treat

cases arising in different judicial circuits that are linked

only by commonality of parties and a purely legal issue as

related for this purpose. See Restatement (Second) of

Judgments § 28(3), at 273 (litigation not precluded when a

“new determination of the issue is warranted by * * * fac-

tors relating to the allocation of jurisdiction” between two

courts).

3. A comparison of this case with Moser confirms that

the court of appeals misapprehended the distinction con-

templated in Maser. To be sure, Moser itself was held to be

controlled by the general rule of preclusion, rather than by

the unmixed question of law exception to that rule recog-

nized in the Court's opinion. 266 U.S. at 242. But the suc-

cessive “demands” in Moser were claims for successive in-

stallments of a pension. Jd. at 240. The transactions and

facts underlying the successive actions were thus identical.

Moreover, the consecutive actions all arose in the same

court. Assuming no statute of limitations problems, if

Moser had been content to bide his time, his successive

claims could have been brought in a single action. Here, by

contrast, the two cases arise from distinct transactions and

neither of the two district courts had jurisdiction to enter-

tain an application to quash the warrant issuing from the

other. The question in Moser, moreover, was highly fact-

bound, if not a mixed question of law and fact. As stated by

the Court (266 U.S. at 242):

[t}he question expressly and definitely presented in

this suit is the same as that definitely and actually liti-

gated in the * * * preceding suits, viz: whether

[Moser] occupied the status of an officer who had

served during the civil war.

Here on the other hand, the issue is purely one of law and

does not turn in any respect upon the application of general

principles to specific factual situations. Accordingly, this

20

case, unlike Moser itself, is governed by the unmixed ques-

tion of law exception to collateral estoppel.

Nor, contrary to the view of the court of appeals, is this

case controlled by the holding of Montana. There, as in

Moser, the Court found the unmixed question of law excep-

tion inapplicable, observing: “the legal ‘demands’ of this liti-

gation are closely aligned in time and subject matter to

those in (the prior case]. 440 U.S. at 163 (emphasis

added). But Montana demonstrates that a significant iden-

tity between successive cases in respects other than the

parties and the legal issue must be found before a judgment

on a question of law in the earlier case will be held to give

rise to an estoppel in the latter case. In addition to identity

of parties and issue, each of the successive actions consid-

ered in Montana, was a challenge to the application of a

given state tax provision to federal contractors in Montana.

The two cases were filed nearly simultaneously to vindicate

the position of a single federal contractor, arising out of the

contractor’s activities in connection with a single federal

dam project. Thus, the successive actions considered in

Montana were related in substantial respects that have no

analogue in this case.

It may also have been appropriate to treat the successive

actions in Montana as arising from a single “demand” be-

cause there the government had engaged in conduct that

may have implicated the core concerns underlying the pre-

clusion doctrine. The United States had litigated the issue

to a conclusion in the Supreme Court of Montana, noted an

appeal to this Court, then dismissed the appeal and pur-

sued a parallel action in the federal district court. The fed-

eral action, moreover, was filed just after the action in

state court had been filed, and was stayed upon the govern-

ment’s stipulation pending resolution of the state court

ligitation. Here, by contrast, the government made no such

tactical decision to engage in duplicative litigation. Rather,

these two cases arise from respondent’s motions to quash

separate search warrants that were routinely sought in the

agency’s performance of its statutory duty to enforce the

Clean Air Act through the Section 114(a)(2) oversight in-

spection program. See page 17-18, supra. And respondent

21

invoked collateral estoppel for the first time upon its appeal

from the district court's decision in this case upholding the

agency’s reading of Section 114(a)(2)."!

4. In treating this case as one presenting the same “right

or question” as that adjudicated in Stauffer J, the court of

appeals failed to consider whether application of collateral

estoppel was warranted in light of the twin purposes

served by the preclusion doctrine: “protecting litigants

from the burden of relitigating an identical issue with the

same party or his privy” and “promoting judicial economy.”

Parklane Hosiery Co. v. Shore, supra, 439 U.S. at 326. At

first galance, the first of these purposes might appear to be

served by the court of appeals’ decision. But, as is ex-

plained above, this case does not entail the “harassment of

[an] adverse party” (Restatement (Second) Judgments,

§ 28, Reporter's Note at 286) that the rule was designed to

prevent. Of course, if the mere possibility of

redetermination of a legal question were prohibited, there

could be no exception for unmixed questions of law. But

where, as here, two actions lack any substantial relation-

ship other than identity of parties and legal issue, the

unmixed question of law doctrine reflects the view that

“the more flexible principle of stare decisis is sufficient to

protect the parties and the court from unnecessary bur-

dens” while allowing for desirable development of the law.

Restatement (Second) Judgments, § 28, comment b at

275-276.

Nor was judicial economy served by the court of appeals’

approach. As a general matter, because the issue was pure-

ly legal, no trial type proceedings, or even elaborate factual

submissions by affidavit, were needed to decide the parties’

contentions. And the labor of deciding the legal question

was substantially reduced because the issue had been fully

addressed in the conflicting opinions of the Ninth and Tenth

't Thus, there is no basis whatever for Judge Jones’ suggestion (Pet.

App. 38a) that EPA has deliberately embroiled respondent in multiple

litigation in order to “test its policy decisions in more than a single cir-

cuit, in circumstances where the same defendant is sued in seriatim

without the agency attempting to exhaust its appeals on the previous

judgment.”

22

Circuits, as well as in the opinion of the district court be-

low. Thus, no substantial economy of judicial resources

could have been achieved by resort to collateral estoppel.

In any event, because a majority of the court of appeals ac-

tually reached the merits, collateral estoppel had none of

the salutary effects usually ‘assigned to the doctrine. The

merits were briefed, argued, and decided. Neither the

court of appeals, nor any of the parties was spared any la-

bor or expense associated with a decision on the merits.

See page 29 note 15, infra.

B. Collateral Estoppel Should Not Be Applied Against

The Government To Preclude Determination Of

Recurring Questions of Public Law

Any ambiguity in the application of the Moser exception

to the issue preclusion doctrine is removed by consideration

of the additional circumstances that set this case apart from

Montana. As the Court there recognized, collateral estop-

pel is inapplicable whenever “special circumstances warrant

an exception to the normal rules of preclusion.” 440 U.S. at

155. See also Parklane Hosiery Co. v. Shore, supra, 439

U.S. at 331. We submit that the special attributes and role

of the United States as a litigant strongly militate against

application of the issue preclusion doctrine to the govern-

ment, particularly when it is engaged in the uniquely sover-

eign function of enforcing the public law that governs the

legal relationships of federal agencies with broad classes of

similarly situated persons or businesses. !2

1. First, unlike cases involving only private litigants, ap-

plication of the issue preclusion doctrine in cases involving

the United States must take account of the unique public

interest in the uniform and rigorous enforcement of laws of

? Because neither the court of appeals nor respondent appears to

have quarreled with this general proposition, but only with its applica-

tion to issues previously litigated between the same parties (see page

26, infra), and because the broader question is fully addressed in our

brief in United States v. Mendoza, No. 82-849 (at pages 25-36), which

presents a closely related question, we present this argument in some-

what abbreviated form here. A copy of our brief in Mendoza, to which

we refer the Court, has previously been provided to counsel for

respondent.

23

general importance and applicability. See Standefer v.

United States, 447 U.S. 10, 24-25 (1980). The fact that this

case, unlike Standefer, is not a criminal prosecution does

not dilute the strength of the policy considerations there

recognized. Whenever the government acts in its sovereign

capacity to enforce the public laws, public policy dictates

the applicability of the Standefer analysis. As the Court

emphasized in JNS vy. Hibi, 414 U.S. 5, 8 (1973): “(T]he

Government is not in a position identical to that of a private

litigant with respect to its enforcement of laws enacted by

Congress.” Rather, the government “is enforcing public

policy established by Congress.” /hid.

Significant practical and legal considerations, applicable

in criminal and non-criminal cases alike, also set the United

States apart from any other litigant and argue strongly

against the estoppel invoked by the court of appeals. First,

the government is involved in far more litigation than any

other party. Second, many of the issues of greatest public

importance arise only in litigation to which the government

is a party; others are characteristically associated with gov-

ernment litigation. See American Medical International,

Inc. v. Secretary of HEW, supra, 677 F.2d at 121 n.24.

Third, the government, unlike other litigants, necessarily

finds itself in litigation presenting a particular legal issue in

a host of jurisdictions. In such cases, which include the

present one, there is special potential for unfairness in the

application of the issue preclusion doctrine to questions of

law for there is substantial likelihood that in litigating a

recurring issue, the government will at some point encoun-

ter an adverse decision.

Because of these unique attributes of government litiga-

tion, application of collateral estoppel in the circumstances

of cases such as the present one would substantially disrupt

the existing process of development of the public law. For

better or for worse, courts of coordinate rank are not bound

by each other’s decisions on questions of law, even as a

matter of stare decisis (see page 18, supra) and, in prac-

tice, often disagree. The upshot is that the law emerges

through the hierarchical process of appeal, en banc review

and, in proper cases, certiorari.

24

Issue preclusion in private litigation—even if extended

to legal questions—ordinarily does not unduly undermine

this process of development of the law because no single lit-

igant is party to more than a small fraction of factually

unrelated cases presenting a common legal question. By

contrast, the government is characteristically, if not invari-

ably, a party to litigation on public law questions. Accord-

ingly, application of collateral estoppel when the govern-

ment has unsuccessfully litigated a question of law in any

court inferior to this one would freeze the development of

the law.

2. Invocation of collateral estoppel against the govern-

ment on recurring questions of public law is inappropriate

for the additional reason that the government, through the

Office of the Solicitor General, employs a unique formal

mechanism for determining whether to take an appeal from

or seek certiorari review of an adverse judgment. See 28

C.F.R. 0.20. This process is uniquely selective, particularly

at the certiorari stage. Moreover, to a degree not ap-

proached by any private party, the government regularly

takes into account factors other than its parochial interest

in prevailing in a particular lawsuit in determining whether

to seek further judicial review. As a result, the Solicitor

General frequently decides against appeal or certiorari in

cases where the legal conclusions of the deciding court are

believed to be erroneous. Such decisions rest upon a host of

other considerations, including: a substantial measure of

prosecutorial discretion, equitable and policy considera-

tions, the perceived practical importance of the decision,

recognition of the limited resources of the government, sen-

sitivity to the crowded dockets of the courts, and, in the

case of applications for further review in this Court, the

Court’s announced criteria for granting certiorari. Because

of the substantial volume of government litigation, and the

substantial share of this Court’s limited docket already

occupied by government cases, self-restraint is particularly

necessary in connection with filing of petitions for a writ of

certiorari.

This case well illustrates these consideration. The court

of appeals faulted the government for its failure to seek

25

certiorari review in Stauffer I (Pet. App. 12a). But at the

time a petition could have been filed there was no conflict-

ing decision of any court of appeals. Moreover, the penden-

cy in the Ninth Circuit of Bunker Hill, an appeal from a

district court decision favorable to the government, as well

as the pendency of respondent’s appeal to the Sixth Circuit

from the district court’s decision favorable to the govern-

ment in this case, necessarily counseled against application

to this Court for further review in Stauffer I]. Any other

course would have ignored this Court’s announced certiora-

ri practices, see Sup. Ct. R. 17.1(a), and would have dis-

served both the Court and those litigants who compete for

a place on its crowded docket.?*

The government's practice of selective pursuit of appel-

late review benefits the public interest and facilitates sound

judicial management. Adoption of the preclusion rule ap-

plied by the court of appeals would compel the United

States to reconsider this salutary practice. Instead, the

government would be obliged to consider an inflexible poli-

cy of appealing (and even seeking certiorari on) the first ad-

verse decision rendered on a legal issue. As a result, the

courts of appeals and this Court especially would be bur-

dened prematurely and unnecessarily, and judicial econ-

omy—the touchstone of the preclusion doctrine—would be

disserved. Moreover, because of the limited docket of this

Court, and the proliferation of statutes and litigation in re-

cent years, constructions of the law that this Court might

ultimately determine to be erroneous would more often be

given finality. Plainly, there is no interest served by invo-

1S We are puzzled as to what significance the court of appeals would

have attached to a denial of certiorari had the government filed a peti-

tion in Stauffer 1. Treating a denial of certiorari as confirming the pre-

clusive effect of a court of appeals’ judgment would be in tension with

the traditional rule that a denial of certiorari has no precedential effect

and would burden this Court's decisions respecting grant of certiorari

with unwarranted consequences. But a rule that denial of certiorari

would relieve a party of the preclusive effect of an adverse court of ap-

peals’ judgment would create an inappropriate incentive for filing of

petitions that do not conform to the Court’s criteria for review.

26

cation of collateral estoppel in the circumstances of this

case that would justify these detrimental consequences.

3. The courts of appeals generally have recognized that

these considerations preclude application of collateral es-

toppel to the government on recurring legal issues. Ameri-

can Medical International, Inc. v. Secretary of HEW,

supra, 677 F.2d at 121-124; Western Oil & Gas Ass’n vy.

EPA, 633 F.2d 803, 808 (9th Cir. 1980); Olegario v. United

States, 629 F.2d 204, 215 (1980); Divine v. Commissioner,

500 F.2d 1041 (2d Cir. 1974). The American Law Institute

also has recognized that preclusion is inappropriate when

The issue is one of law and treating it as conclusively

determined would inappropriately foreclose opportuni-

ty for obtaining reconsideration of the legal rule upon

which it was based * * *,

Restatement (Second) of Judgments § 29(7). Thus, when

“the party against whom the rule of preclusion is to be ap-

plied is a government agency responsible for continuing ad-

ministration of a body of law applicable to many similarly

situated persons * * * the rule of preclusion should ordi-

narily be superseded by the less limiting principle of stare

decisis.” Id. at § 29 comment i; see also id. at § 28(2) &

comment c.

C. Identity of Parties in Successive Cases Does Not Jus-

tify Application of Collateral Estoppel on Recurring

Questions of Public Law

The court of appeals evidently concluded that the forego-

ing principles had no application in the setting of this case

because respondent was the party adverse to the govern-

ment in Stauffer I as well as in the present case (Pet. App.

lla, 12a-13a (opinion of Weick, J.); id. at 37a-38a (opinion

of Jones, J.)). Respondent, too, appears to rely upon that

distinction. Memo. in Opp. 7, 8-9 & n.11.

1. Like respondent (Memo. in Opp. 7), we acknowledge

that, even after the demise of the strict rule of mutuality of

estoppel (see page 17 note 9, supra), identity of parties

remains a relevant consideration in applying collateral es-

toppel to particular cases. When issues are litigated be-

tween parties that have previously litigated them, a party

ordinarily cannot claim surprise when it finds itself bound

27

by pertinent determinations necessary to a judgment rend-

ered against it, even on a different cause of action, if nei-

ther the factual nor the legal setting has changed in the in-

terim. See Montana v. United States, supra, 440 U.S. at

158-162; American Medical International, Inc. v. Secre-

tary of HEW, supra, 667 F.2d at 121 n.24, 124 & n.46.

Even so, as explained above (pages 15-22), invocation of

collateral estoppel to govern unmixed questions of law

arising in factually distinct cases remains inappropriate,

and in such cases the alternative doctrine of stare decisis is

a sufficient bulwark against repeated litigation and undue

demands upon judicial resources. But the factors that coun-

sel against application of collateral estoppel to unmixed

questions of law apply with special force in government liti-

gation where, as here, the issue is a recurring one of public

law that applies to a significant class of similarly situated

persons. In such cases, resort to collateral estoppel would

improperly afford the party that happened to be involved in

the prior case decided against the government a favored

position in the administration of law. As Judge Siler ex-

plained below (Pet. App. 40a-41a):

Here, injustice would result if EPA were precluded

from entering with private contractors at Stauffer’s

plant in Tennessee, but were using private contractors

in entering competitors’ plants in the same area.

The undesirability of applying collateral estoppel in this

setting has been recognized by commentators. As the

American Law Institute has stated (Restatement (Second)

of Judgments, § 28):

(Rjelitigation of [an] issue [previously determined] in a

subsequent action between the parties is not precluded

(when):

* ” ” = =

(2) The issue is one of law and * * * a new determina-

tion is warranted in order to * * * avoid inequitable

administration of the laws * * *.

In this connection the authors of the Restatement explain

(id. at comment c, at 278):

[I]t can be particularly significant that one of the par-

ties is a government agency responsible for continuing

administration of a body of law that affects members of

28

the public generally, as in the case of tax law. Refusal

of preclusion is ordinarily justified if the effect of ap-

plying preclusion is to give one person a favored posi-

tion in current administration of current law.

Accord: American Medical International, Inc. v. Secre-

tary of HEW, supra, 677 F.2d at 124. As Judge Siler ap-

preciated, this case is a striking example of the problem

recognized by the Restatement. This case arises from

EPA’s Region IV, one of 10 such administrative units. Ap-

proximately 4600 major stationary pollution sources subject

to inspection under the “overview inspection program” are

located in eight state areas encompassed in Region IV

alone (Pet. App. 59a). Roughly 10% of these sources are

likely to be inspected annually under this program. Thus,

on a nationwide basis, thousands of businesses are affected

each year by the question of contractor participation in Sec-

tion 114 inspections. It accordingly would be anomalous in-

deed to create—through invocation of collateral estop-

pel—a special private law applying to respondent alone on

this question of statutory interpretation.

Contrary to Judge Jones’ suggestion (Pet. App. 36a), it is

no answer to observe that refusal to apply collateral estop-

pel will entail a different kind of disparity in the application

of the laws—one that depends upon geography. First, the

doctrine of stare decisis and the persuasive force of the de-

cision of courts of coordinate or inferior rank will, in the

long run, at least, minimize such “inequities.” And it is

uniquely the province of this Court to act as final arbiter of

any issues that divide the courts of appeals. The short-term

unevenness of result permitted by redetermination of re-

curring questions of public law by coordinate courts is,

moreover, essentially inoffensive. It is a natural result of

the operation of a system of lower courts with limited geo-

graphic jurisdiction, and a Supreme Court with control

over its limited docket.

On the other hand, application of different rules of law to

persons similarly situated resulting from collateral estop-

pel is in tension with fundamental values of equal justice.

Compromise of those values is ordinarily warranted by the

competing desiderata of judicial economy, protection of par-

29

ties against multiple lawsuits, and the role that issue pre-

clusion plays in minimizing inconsistent judgments. See

Montana v. United States, supra, 440 U.S. at 153-154. But

as we have explained above (pages 21-22), none of these

competing objectives is advanced by application of collater-

al estoppel in a setting such as the present one. And where,

as here, the decision afforded preclusive effect is itself in-

consistent with the decision of another court of coordinate

rank, invocation of collateral estoppel plainly cannot elimi-

nate inconsistent judgments. The burden of multiple law-

suits, moreover, is a significantly less weighty considera-

tion where, as here, multiple litigation arises from a federal

agency’s duty to apply a uniform interpretation of a statute

applicable to a host of similarly-situated parties. By engag-

‘Thg in a regulated business within the various judicial cir-

cuits, each of which is ordinarily free (subject only to this

Court’s decisions) to interpret statutes for itself. regndent

subjected itself to the possibility that it would become en-

gaged in parallel litigation presenting a common legal ques-

tion (see pages 17-18, and page 21 note 11, supra). 14 Thus,

the inequity that would result from application of collateral

estoppel in this case is substantially more troublesome from

the point of view of the fair administration of justice than

the possibility of conflicts among the circuits perceived by

Judge Jones.15

* We note that respondent operates plants in 30 states, spanning 11

of the 12 judicial circuits. See 55H) 2 Moody's Industrial Manual! 5985

(1982). Because 10% of major pollution sources are inspected by EPA

annually (see page 2 note 1), it is not in the least remarkable that re-

spondent has encountered the legal issue presented here more than

once. Eighteen of respondent's plants are located within the Ninth Cir-

cuit. Query whether under the Sixth Circuit's analysis EPA is obliged

to follow Stauffer I with respect to these plants, notwithstanding the

Ninth Circuit's contrary decision in Bunker Hill. If so, the resulting

discrepancy in the administration of the laws is substantial indeed.

'® Nor does Judge Jones’ Suggestion (Pet. App. 37a) that the inequi-

ty produced by application of collateral estoppel is illusory here be-

cause a majority of the court reached the merits, support the applica-

tion of collateral estoppel. Because a majority of the court of appeals

relied upon collateral estoppel, there was no reason for the court to

reach the merits. See Montana v. United States, supra, 440 U.S. at

30

2. The fact that the parties in this case and Stauffer I are

identical cannot justify application of collateral estoppel for

yet another reason. At the time when the Solicitor General

decides whether to authorize an appeal, or whether to seek

review in this Court of an adverse judgment, it typically is

impossible to determine whether future litigation will arise

in a case involving the same party or a different party. The

Solicitor General's decision—particularly respecting wheth-

er to seek certiorari—must turn instead upon the general

importance of the issue, the existence of a conflict and the

other criteria traditionally applied by this Court. If the

United States is to be bound in future litigation with the

adverse party, however, the mere possibility of future liti-

gation with the same party militates powerfully in favor of

further review in many cases that otherwise do not warrant

that extraordinary step.

3. We have already explained (pages 20-21) why this case

is not controlled by the holding of Montana v. United

States, supra. We add here only that the Court’s decision in

Montana cannot be understood to discount the policy and

practical considerations we have outlined that affect issue

preclusion in government litigation. These factors had little

application in Montana. The issue presented there could

arise only in two forums (setting to one side this Court’s

original jurisdiction)—the Montana state courts and the

United States District Court for Montana. There thus was

little basis for concern respecting impairment of the devel-

opment of the law. And because the record reflected a delib-

erate effort to pursue parallel litigation on indistinguishable

claims (see page 20, supra), there was less reason to defer

to the Solicitor General’s selective appeal policy. More im-

portantly, perhaps, the underlying legal question pre-

sented, while of undoubted importance to the United

States, did not affect a class of similarly situated persons,

but only the proprietary interests of the litigants. There

152-153; cf. Bowen v. United States, 422 U.S. 916, 920 (1975). Con-

versely, because a separate majority reached the merits, invocation of

collateral estoppel could have none of the salutary effects assigned for

the doctrine generally. See page 21-22, supra.

31

was accordingly no occasion for the United States to argue

in Montana, as it does here, that the application of the pre-

clusion doctrines was inappropriate in light of the govern-

ment’s special attributes and responsibilities. The Court’s

opinion thus does not reflect any view adverse to our pres-

ent contentions.

D. Other Considerations Weigh Against Application of

Collateral Estoppel in the Setting of this Case

Two other factors militate against the estoppel recog-

nized by the court of appeals. First is the Ninth Circuit’s

decision in Bunker Hill Co. v. EPA, supra, that conflicts

with Stauffer 1.4® Parklane Hosiery Co. v. Shore, supra,

439 U.S. at 330 & n.14. In view of the conflicting prece-

dents that confronted it, the court of appeals should simply

have given each decision of a coordinate court such persua-

sive force as it warranted, rather than resorting to the

rigid artificial rule of collateral estoppel to elevate one of

those prior decisions above the other.

Reliance upon collateral estoppel with respect to legal is-

sues is, moreover, particularly inappropriate in the context

of the difficult questions of statutory interpretation that

arise under our complex environmental laws. See, £.J.

duPont de Nemours & Co. v. Train, 430 U.S. 112, 135 &

n.26 (1977); Western Oil & Gas Ass’n v. EPA, supra, 633

F.2d at 808. This Court frequently has entered into such

controversies only after a substantial accumulation of ap-

pellate jurisprudence. See, e.g., Union Electric Co. v.

EPA, 427 U.S. 246, 254-255 (1976); Train v. NRDC, 421

U.S. 60, 72-75 (1975). This practice may be based in part

upon the provisions of the major environmental statutes as-

signing jurisdiction to address certain claims upon a geo-

graphical basis, while others are treated as matters of na-

tional concern. See, e.g., 33 U.S.C. 136%b) (Clean Water

Act); 42 U.S.C. (Supp. V) 7607(b)(1) (Clean Air Act).17 But

1® See also pages 3-4 note 2.

17 On those rare occasions when Congress has wished to make the

decision of a single court of appeals respecting a particular issue final

save only for review by this Court, it has done so explicitly, by desig-

32

even where such explicit statutory provision is not made,

questions of law under the environmental control statutes

are capable of arising in every jurisdiction. It appears par-

ticularly inappropriate to import the rigid issue-preclusion

doctrine into this area in a fashion that would undercut the

traditional independence of the circuits. Moreover, because

of the prominent role in environmental litigation of large in-

dustrial corporations, national trade associations and na-

tional environmental advocacy groups, many of which do

business or conduct litigation in manifold jurisdictions, any

rule that assigns controlling weight to the identity of par-

ties in determining the applicability of collateral estoppel in

this setting provides an undesirable incentive for forum

shopping, and also fosters indefensible inequities in the ad-

ministration of the law to similarly-situated parties.'*

nating a single forum for litigation of questions of nationwide impor-

tance. In addition to Section 307(b)(1) of the Clean Air Act, 42 U.S.C.

(Supp. V) 7607(b\1), see Section 211(b\(1) of the Economic Stabiliza-

tion Act of 1970, 12 U.S.C. 1904 note. Cf. Section 526(a)(1) of the Sur-

face Mining Control and Reclamation Act of 1977, 30 U.S.C. (Supp. V)

1276(a)(1).

1® By way of illustration, we note that United States Steel Corpora-

tion challenged the EPA's failure to comply with the notice and com-

ment requirements of 5 U.S.C. 553 in promulgating final rules desig-

nating various areas as exceeding national ambient air quality

standards for total suspended particulates in the Fifth Circuit, United

States Steel Corp. v. EPA, 595 F.2d 207, modified, 598 F.2d 915

(1979), the Seventh Circuit, United States Steel Corp. v. EPA, 605

F.2d 283 (1979), cert. denied, 444 U.S. 1035 (1980), and in the Eighth

Circuit, United States Steel Corp. v. EPA, 649 F.2d 572 (1981). Other

companies challenged the EPA's procedure in the Third Circuit,

Sharon Steel Corp. v. EPA, 597 F.2d 377 (1979), the Sixth Circuit,

Republic Steel Corp. v. Costle, 621 F.2d 797 (1980), the Ninth Cigeuit,

Western Oil & Gas Ass'n v. EPA, supra, and the District of Columbia

Circuit, New Jersey Department of Environmental Protection v.

EPA, 626 F.2d 1038 (1980). It would have been anomalous in the ex-

treme for the result in any of those cases to have turned upon the pres-

ence or absence of a particular party—United States Steel.

33

Il. UNDER SECTION 114(a)(2) OF THE CLEAN AIR

ACT, A CONTRACTOR DESIGNATED AS AN “AU-

THORIZED REPRESENTATIVE” BY THE EPA

ADMINISTRATOR MAY PARTICIPATE IN AGEN-

CY INSPECTIONS OF STATIONARY AIR POLLU-

TION SOURCES

Section 114 of the Clean Air Act was originally enacted in

1970 as part of the comprehensive Clean Air Amendments

of that year, 84 Stat. 1687-1688, to the pre-existing federal

air pollution legislation. Section 114(a), which remains to-

day substantially in the form enacted in 1970, advances the

congressional purpose “to protect and enhance the quality

of the Nation's air resources” (42 U.S.C. (Supp. V)

7401(b)(1)), in two important respects. Section 114(a)(1) au-

thorizes EPA to require owners or operators of stationary

emission sources to carry out a program of emission moni-

toring and to maintain emission records. Section 114(a)(2)

empowers “the Administrator or his authorized representa-

tive, upon presentation of his credentials “to enter upon the

premises of such an operator to copy records, inspect moni-

toring equipment or sample emissions.” The issue in this

branch of this case is simply whether, as the court of ap-

peals held (Pet. App. 33a) “the words ‘authorized repre-

sentative’ in Section 114(a)(2) * * * mean officers or em-

ployees of the EPA, and cannot include employees of

private contractors.”

A. Statutory Language and Legislative History Indicate

That the Administrator is Authorized to Secure Con-

tractor Assistance for Stationary Source Inspections

1. We began with the language of the statute directly in

issue. See United States v.Turkette, 452 U.S. 576, 580

(1981). Section 114(a)(2) empowers “the Administrator or

his authorized representative” to enter upon the site of a

stationary pollution source for the purpose of sampling

emissions. Because the term “authorized representative” is

nowhere defined in the Clean Air Act, there is no reason to

believe that Congress intended that it be assigned a special

limited meaning. Rather, the statutory terms should be as-

signed “their usual and ordinary sense” (Caminetti v.

United States, 242 U.S. 470, 485-486 (1917)).

34

As the Ninth Circuit observed in Bunker Hill Co. v.

EPA, supra, 658 F.2d at 1283, the common understanding

of the terms employed by Congress in Section 114(a)(2)

compels the conclusion that a duly designated contractor

qualifies to participate in an EPA stationary source inspec-

tion. The dictionary teaches that “authorize” means “to en-

dow with authority or effective legal power” and that “au-

thorized” means “endowed with authority.” Webster's

Third New International Dictionary 146, 147 (1976).19 A

“representative” is one who “respresents another as agent,

deputy, substitute or delegate, usulally) being invested

with the power of the principal.” /d. at 1926-1927. The

term representative is thus defined in functional terms,

resting upon the concept of agency, and does not carry any

implication of an employment relationship. Accordingly, a

contractor specially retained by the EPA Administrator for

the purpose of providing technical support to agency em-

ployees in a stationary source inspection qualifies as an “au-

thorized representative” and may participate in the inspec-

tion.?°

2.a. As the district court recognized, consideration of re-

lated provisions of the Clean Air Act supports the agency’s

interpetation of Section 114(a)(2). The district court ob-

served (Pet. App. 47a-48a):

Section 114 contains two references to “authorized

representatives.” In addition to subsection (a)(2), sub-

1® There is no question in this case as to whether the Administrator

duly authorized PEDCo personnel to participate in the inspection of

respondent's premises or whether that authorization was evidenced by

credentials carried by the PEDCo personnel.

20 Indeed, the court of appeals acknowledged (Pet. App. 22a) that

(the plain meaning of ‘representative,’ ” is “one standing or acting for

another through delegated authority,” but declined to apply that plain

meaning in this case. See page 39, infra.

Comparison of this case with NLRB v. Amaz Coal Co., 453 U.S.

322 (1981), is instructive. There the court held that certain employer-

selected trustees of union pension fund are not “representatives” of

the employer for specified purposes under the National Labor Rela-

tions Act because the trustees’ duties were inconsistent with any no-

tion that they served as agents of the employer's interests. Jd. at

329-330, 332-334.

35

section (c) allows confidential information obtained un-

der subsection (a) to be disclosed to “other officers,

employees, or authorized representatives of the United

States concerned with carrying out this Act.” 42

U.S.C. § 7414(c) (emphasis added). That Congress in-

tended authorized representatives to be distinguish-

able from officers and employees is obvious from the dis-

junctive listing in this section. If authorized representa-

tives were limited to officers or employees, the inclusion

of authorized representatives in this subsection would

have been mere surplusage. The Court will not conclude

that Congress intended to be redundant.

The district court (and the court of appeals) correctly ap-

preciated that Section 114(c) necessarily sanctions disclo-

sure of information gathered in inspections to designated

agency contractors for use in the performance of their du-

ties, for the use of the disjunctive “or” clearly indicates

that Congress extended this authority beyond officers and

employees of the United States. See Reiter v. Sonotone

Corp., 442 U.S. 330, 338-339 (1979).21 There is simply no

reason to believe that Congress intended to assign the term

“authorized representative” a different meaning in Section

114(a)(2), for the two provisions are intimately related and

were enacted simultaneously. Such an intent is not to be at-

tributed to Congress absent compelling support in legisla-

tive history and only in circumstances where a consistent

interpretation of the statutory language leads to “absurd or

futile results.” Mohasco Corp. v. Silver, 447 U.S. 807, 818

(1980), quoting United States v. American Trucking

Assn’s, 310 U.S. 534, 543 (1940).22

*! Respondent appears to suggest (Memo. in Opp. 12 n.16), half-

heartedly, that Section 114(c) may be intended to cover “federal judg-

es, attorneys at the Department of Justice and U.S. Attorneys, and

Coast Guard officers and officials.” But all of the persons suggested

are officers and employees of the United States. Even if it were as-

sumed that federal judges were not to be treated literally as officers of

the United States, Section 114(c) separately authorizes disclosure of

inspection data “when relevant in any proceeding” under the Clean Air

Act. Plainly, Section 114(c) must extend to persons other than govern-

ment employees.

*2 We note that, contrary to the court of appeals’ suggestion (Pet.

App. 22a), an interpretation of the term “representative” employed in

36

b. Instead of interpreting Section 114(a)(2) in conformity

with the plain meaning of the identical language of Section

114(@, the\ court of appeals unaccountably focused upon

Section 114(d) of the Clean Air Act, which requires “the

Administrator (or his representatives)” to provide reason-

able notice to the concerned state air pollution control agen-

ey before carrying out an inspection under Section 114(a)(2)

in certain circumstances. The court of appeals reasoned

(Pet. App. 20a-21a) that giving the notice required by Sec-

tion 114(d) entails “sensitive intergovernmental communi-

cation” that Congress simply could not have intended to en-

trust to private contractors, That analysis, however, is

flawed in numerous respects. First, Section 114(d) was

added to the Clean Air Act by 1977 amendments,® and ac-

cordingly sheds no light upon the intentions of the 87th

Congress that adopted both Section 114(a)(2) and Section

114(c) in 1970. Given the actual chronology, the district

court's reliance upon Section 114(c) in interpreting Section

114(a)(2) was plainly warranted, while the court of appeals’

reliance on Section 114(d) was not. The weight to be at-

tached to Section 114(c) is enhanced, moreover, by the fact

that both that subsection and Section 114(a)(2) employ pre-

cisely the same language—‘authorized representa-

tive’—while Section 114(d) speaks only of the Administra-

tor’s “representative.”

Second and more fundamental, while we may well agree

that it is preferable as a matter of policy for EPA to limit

intergovernmental communications to regular government

employees or officers—as it does, the court of appeals’ read-

ing of Section 114(d) is unsupported by any statutory lan-

Section 114(c) that includes persons other than agency employees does

not suggest that inspections under Section 114(aX2) may only be

carried out by non-employees or the Administrator acting in person.

In any event, Section 301 of the Clean Air Act authorizes the Admin-

istrator to delegate any of his duties, except for rulemaking, to agency

employees. In light of the availability of Section 301, the court of

appeals’ decision limiting the class of “authorized representatives” un-

der Section 114(aX2) to agency employees renders that language

surplusage.

* Clean Air Act Amendments of 1977, Pub, L. No, 95-95, Section

113, 91 Stat. 709,

37

guage or legislative history.*4 Absent any actual indication

of @ congressional intent, it is more reasonable to assume

that Congress was content to rely upon EPA's prudence

upon this point. “Only when a literal construction of a stat-

ute yields results so manifestly unreasonable that they

could not fairly be attributed to congressional design will an

exception to statutory language be judicially implied.”

United States vy. Rutherford, 442 U.S. 544, 555 (1979). In

any event, tne Court is not asked to decide whether EPA

may use contractors to give notices under Section 114(d).

However that may be, there is no warrant for interpreting

Section 114(a)(2) in light of an intent respecting a different

provision of law, enacted at a later date, that has been

imputed to Congress without any support in the legislative

record,

This is especially so because whatever policies might un-

derlie a restrictive implementation of Section 114(d) gata

have no application in the setting of Section 114(a\(2). The

notice function contemplated by Section 114(d) appears to

be purely ministerial in nature; no technical expertise is

needed. And the decision to undertake a particular inspec-

tion is inherently governmental in nature. By contrast, the

role fulfilled by EPA contractor-representatives that assist

agency employees in stationary source inspections is purely

technical. There is no reason for Congress to have assumed

that the necessary expertise would, in every instance be

available among agency personnel in the necessary location

(see page 4, infra). Thus participation by specially chosen

contractor personnel is wholly appropriate.

Respondent argues (Memo. in Opp. 13), however, that

“absent specific direction by Congress,” the inspections of

38

the cases cited by respondent do not in fact support the

stated proposition,®® we may assume that it is generally

correct. But see 18 U.S.C. 3105 (allowing persons other

than officers authorized by law to assist such an officer in

serving a search warrant). But, the authority claimed by

the Administrator is merely to avail himself of technical as-

sistance in carrying out stationary source inspections. The

policies that apply to conventional governmental searches

accordingly have no application here. In any event, as we

have explained, Congress’ intent regarding the issue in this

case is clear, Of particular importance in this respect is the

provision in Section 114(c) of the Act authorizing the Ad-

ministrator to disclose information gathered in Section

114(a)(2) inspections to contractor-representatives for use

in connection with the purposes of the Act, notwithstanding

the fact that the data may include trade secrets or other

proprietary information. The significance of this fact is two-

fold. First, Congress plainly did not regard this area as one

governed by policies that require performance of all roles

by government employees. Second, given that the Agency

unquestionably is authorized to use its own personnel to

collect data during inspections, and is free then to turn

these data over to contractors whose assistance is needed

for analysis, it would be pointless to preclude contractor

participation in data collection itself.**

™ Indeed, Steele v. United States No. 2, 267 U.S. 505 (1925), rejects

artificial or overly technical limits upon the scope of a stututory grant

of search authority, as does United States v. Gannon, 261 F. Supp. 68

(D. Mass. 1961).

* In any event, contrary to respondent's assumption, this case does

not present the question whether EPA contractor-representatives may

be authorized to “execute(e) search warrants” (Memo in Opp. 13). The

warrant at issue in this case runs in favor of:

EPA, through its duly authorized full-time employees and accom-

panying, authorised representatives under contract with EPA.

Pet. App. 45a (emphasis added). See also Stauffer /, supra, 647 F.2d

at 1076-1077 (same limitation). We emphasize that Section 114(aX2) re-

quires the Administrator's representative to present proper creden-

tials in order to gain entry to a source's premises.

39

c. The court of appeals’ reliance upon its reading of Sec-

tion 114(d) led it to adopt a Byzantine interpretation of Sec-

tion 114 as a whole (Pet. App. 22a):

(T]he only logical conclusion is that the word “repre-

sentative” as used in section 114 of the Clean Air Act

means EPA officers or employees, unless the latter

are already enumerated, as they are in section 114(c).

In that event, the plain meaning of “representative,”

i.e., one standing or acting for another through dele-

gated authority, controls. We realize that this leads to

the undesirable result that the word “representative”

has different meanings in different portions of the stat-

_ Beadtaia

The court of appeals’ view that this result is simply una-

voidable is entirely unfounded.

3.a. The only explanation offered by the court of appeals

for declining to follow the plain language of Section

114(a)(2) was that “plain meaning * * * is not always deci-

sive * * * especially * * * when the legislative history

suggests a different interpretation” (Pet. App. 17a). But

the court failed to identify anything in the pertinent legisla-

tive history that significantly supports its reading of the

statute. Indeed, what little light is shed by the legislative

history, supports the agency’s position.

The Clean Air Act, as amended in 1967, granted very lit-

tle federal enforcement authority. No right of entry to sta-

tionary sources was provided. The Secretary of HEW was

authorized only to require submission of emission reports

on such sources. Section 108(j), 42 U.S.C. (Supp. III 1964

ed.) 1857d(j). By contrast, Section 207(a) of the 1967 Act

provided for access by an “offiver or employee” of the Sec-

retary to the records of motor vehicle manufacturers, 42

U.S.C. (Supp. III 1964 ed.) 1857f-6(a). Both the House of

Representatives and the Senate proposed to add stationary

source inspection authority to the Clean Air Act when a

federal enforcement role was authorized in the 1970

Amendments to the Act. Section 5(a) of the House Bill,

H.R. 17255, 91st Cong. 2d Sess. (1970) would have added

Section 112(f) to the Act, granting the right to enter and in-

spect stationary sources, but only to “officers or employees

duly designated by the Secretary [of HEW] upon present-

40

ing appropriate credentials and a written notice to the own-

er or person in charge * * *.” A Legislative History of the

Clean Air Act Amendments of 1970, 93d Cong., 2d Sess.

923 (Comm. Print 1974) (“Leg. Hist.”). The Senate bill,

S. 4358, 9lst Cong., 2d Sess. (1970), generally granted

more expansive inspection authority than its House coun-

terpart. For example, Section 115 of the Clean Air Act as

proposed in the Senate bill significantly broadened the ba-

sis upon which inspections could be made, deleted the

House requirement of written notification, and deleted the

House requirement that inspections be completed with rea-

sonable promptness. More pertinently, proposed new Sec-

tion 116(a)(3) of the Senate bill provided that “the Secre-

tary or his authorized representative” could inspect both

stationary sources and motor vehicle manufacturers’ prem-

ises. Leg. Hist. at 570.

In conference, the Senate’s language was adopted for sta-

tionary source inspectons, Leg. Hist. at 163, 198,27 while

the more limited House version, based on the 1967 Act,

survived for motor vehicle manufacturers. The Conference

Committee’s adoption of the more expansive Senate version

of Section 114(a)(2) of the Act thus evidenced Congress’ de-

liberate intent to make a distinction, i.e., to grant broader

rights of entry to the Administrator than the House version

would have allowed. Otherwise, no change of words would

have been warranted. See Gulf Oil Corp. v. Copp Paving

Co., 419 U.S. 186, 199-200 (1974).

b. The court of appeals, however, discounted this legisla-

tive history, in large measure because the legislative re-

ports do not focus upon the difference between the lan-

guage employed in the House and Senate bills (Pet. App.

19a, 20a). But Congress has no obligation to recognize in

legislative history the effect of what it has established

through direct statutory language. See Harrison v. PPG

Industries, Inc., 446 U.S. 578, 592 (1980); ef. EEOC v.

Wyoming, “‘o. 81-554 (Mar. 2, 1983), slip op. 16 n.18. In

any event, Congress’ failure to create controlling legislative

27“The provisions of the conference substitute with regard to in-

spections, monitoring and entry follow substantially the provisions of

the Senate amendment.” Leg. Hist. at 198.

41

history cannot dislodge the effect of the statutory language

itself.

The court of appeals also relied (Pet. App. 20a) upon the

thumb-nail descriptions of the respective House and Senate

bills contained in the Conference Report that referred re-

spectively to entry by “DHEW personnel” and “DHEW in-

vestigative personnel.” See pages 8-9, supra. But, as the

Ninth Grcuit emphasized in Bunker Hill, supra, 658 F.2d

at 1283-1284, the Conference Report simply does not focus

on the identity of persons authorized to make inspections,

and the casual descriptions of the two bills employed in the

Report simply reflect no view on the question at issue.?®

c. In any event, Congress’ intent affirmatively to distin-

guish between “authorized representatives” and “officers

and employees” emerges clearly from cognate provisions of

the statutory language. When Congress intended the right

of entry to be limited to EPA’s officers and employees, it

knew how to say so. Thus, in Sections 206(c) and 208, the

mobile sources provisions of the Act, 42 U.S.C. (Supp. V)

7525(c) and 7542, Congress retained the use of the more re-

strictive term “officers and employees” for inspection of

motor vehicle manufacturer’s facilities and records, ex-

empting such facilities from the operayon of Section 114.

Congress could easily have repeated in Section 114 the lan-

guage of the section dealing with inspections of motor vehi-

cle manufacturers, but chose not to do so. The broader

term “authorized representatives” was thus deliberately

chosen by Congress.

The court of appeals recognized the difference in statuto-

ry language between the stationary source provisions of the

Clean Air Act and the motor vehicle manufacturing plant

provisions (Pet. App. 23a). Nevertheless, without adducing

any support in the legislative history, that court inter-

preted Section 114(a)(2) to conform to Sections 206(c) and

208 of the Act, reasoning that the maintenance of different

rules would be “illogical and inconsistent” (Pet. App. 25a).

2® The term “DHEW personnel” is not, in any event, a term with a

defined legal significance; it may without difficulty be read to embrace

persons retained on contract as well as government employees.

42

But there is no suggestion of a denial of equal protection of

the laws here and any such contention would be frivolous.

Accordingly the court of appeals’ analysis forgets that

“{uJnder our constitutional framework, federal courts do

not sit as councils of revision, empowered to rewrite legis-

lation in accord with their own conceptions of prudent poli-

cy.” United States v. Rutherford, supra, 442 U.S. at 555.2%

d. As noted above (page 10 & note 7), the court of ap-

peals relied heavily (Pet. App. 26a-29a) upon legislative his-

tory of an entirely different statute, the Clean Water Act.

Despite the near identity of Section 308(a)(B) of the Clean

Water Act, 33 U.S.C. 1318(a)(B), and Section 114(a)(2),

that reliance was misplaced. First, it is fundamental that

the legislative history of a subsequently enacted statute of-

fers little, if any, help in interpreting an earlier enactment.

Consumer Product Safety Commision v. GTE Sylvania,

Inc., 447 U.S. 102, 118 n.13 (1980). To be sure, in relying

upon the Senate Report on the Clean Water Act Amend-

ments of 1972, the Sixth Circuit emphasized that both the

Clean Air and Water Acts were reported out of the same

Senate committee (Public Works) (Pet. App. 28a). Yet, in

1980, that same committee, when considering the “Super-

fund” legislation, S. 1480, 96th Cong., lst Sess. (1979), the

proposed Environmental Emergency Response Act,®°

wrote:

To implement the site and facility investigation and re-

sponse authorities contemplated by this bill, the Ad-

29 In any event, there is nothing irrational about the distinction cre-

ated. Congress could well have taken notice that the number of domes-

tic automobile manufacturers is limited. Congress could also have rea-

soned that given the importance of this industry, and the special

attention it receives in the Clean Air Act generally, it was reasonable

to expect EPA to develop the technical expertise necessary to carry

out inspections with its own employees. The same could hardly be said

of the nearly infinite variety of expertise that might be needed in in-

spection of all other forms of industrial plants. See page 45, infra.

* The Superfund bill, which created a cleanup and compensation

mechanism to address hazardous waste deposits, eventually was en-

acted into law, with changes that are not pertinent here, on December

11, 1980. Comprehensive Environmental Response Compensation and

Liability Act of 1980, Pub. L. No. 96-510, 94 Stat. 2767, 42 U.S.C.

(Supp. V) 9601 et seq.

43

ministrator will frequently utilize contractors as his

authorized representatives. The access, entry and

other information-gathering powers granted to the Ad-

ministrator and his authorized representative under

** * section 114 of the Clean Air Act [and] section

308 of the Clean Water Act * * * apply to authorized

Federal contractors as the Administrator's

representatives.

S. Rep. No. 96-848, 96th Cong., 2d Sess. 62 (1980) (empha-

sis added). The conflict between these two pieces of legisla-

tive history emphasizes the hazards of reliance upon after-

the-fact legislative history. In both instances the reliability

of the statements made respecting earlier legislation is

open to question, both because there was relatively little

incentive for any Member of Congress to state a different

view, and because no Member is likely to have altered his

vote because of agreement or disagreement with the Re-

port's description of p» or legislation.®

In addition to the legislative history of the Clean Water

Act, the court of appeals relied (Pet. App. 29a) upon lan-

guage and legislative history of Section 3007(a) of the Solid

Waste Disposa! Act, 42 U.S.C. 6927(a). As indicated above

(page 10), a 1980 amendment added “representative[s)” of

the Administrator to the enumeration of persons desig-

nated to make hazardous waste inspections. The Senate Re-

port stated:

(T]he amendment clarifies that the Administrator may

authorize EPA contractors to obtain samples, perform

inspections, and examine records at facilities which

handle hazardous wastes.

*) In any event, the 1972 legislative history of the Clean Water Act

is at best amibiguous. The language upon which the court of appeals

relied (see page 10 note 7, supra), could be read to address only the

status of contractors engaged in “research and development” as distin-

guished from those assisting in inspections to determine compliance

with emissions limitations.

44

S. Rep. No. 96-172, 96th Cong., 2d Sess. 3 (1979) (emphasis

added). Notwithstanding the fact that Congress chose the

term “representative” —the very language at issue here—-

to achieve the effect noted in the report, the inference

drawn by the court of appeals was: “[w)Jhen Congress

meant to erpand inspection authority beyond EPA officers

and employees it knew how to do so and took specific steps

to make that clear” (Pet. App. 30a; emphasis in original).

But Congress has no obligation to create legislative history

documenting that it meant what it said. See page 40,

supra.

4. Our discussion thus far suffices, we presume to sug-

gest, at least to demonstrate that the court of appeals’

analysis is flawed, and that substantial arguments can be

marshalled in favor of the agency’s interpretation of the

statute. Indeed, the court of appeals all but conceded the

point (Pet. App. 16a-17a, 22a, 29a, 30a, 41a). The court ac-

knowledged that “cogent arguments can be raised upon

both sides” of the issue (id. at 33a), and recognized that in-

ferences opposed to its own could “just as logically” be

drawn from the legislative materials (id. at 30a; see also id.

at 24a). In the circumstances, the court of appeals plainly

was obliged to defer to the agency’s interpretation of the

statute it is charged with enforcing. See Udall v. Tallman,

380 U.S. 1, 16 (1965). To merit such deference the agency’s

interpretation of its statute need not be the only reasonable

one, nor need it be the one the court would prefer were it

writing on a clean slate. /bid. And these principles apply

with full force to our Nation’s complex environmental laws.

See, e.g., EPA v. National Crushed Stone Ass'n, 449 U.S.

64, 93-84 (1980). Specifically, this Court has “accorded

great deference to the Administrator’s construction of the

Clean Air Act.” Union Electric Co. v. EPA, 427 U.S. 246,

256 (1976). In the circumstances, there is no room to doubt

that the agency's interpretation of Section 114(aX2) “was

sufficiently reasonable to preclude the Court of Appeals

from substituting its judgment for that of the Agency”

(Train v. NRDC, 421 U.S. 60, 87 (1975)).™*

* Since its creation in 1970, the EPA has construed the phrase “au-

thorized representative” as used in both Sections 114(aX2) and 114(c)

to include contractor-representatives. As the district court found, the

45

The court of appeals’ decision eliminates an important

tool employed by the EPA to assure enforcement of the

Clean Air Act through its overview inspection program. If

private contractors may not be designated to assist in con-

ducting Section 114(a)(2) inspections, the agency’s ability to

operate an effective overview inspection program may be

compromised, For instance, only 22 technically trained em-

ployees employed in EPA’s Region IV (the administrative

unit encompassing Tennessee) are responsible for moni-

toring compliance by approximately 4600 major stationary

sources of air pollution located in an eight-state area. See

Pet. App. 59a. EPA has relied upon contractor-repre-

sentatives both because its own enforcement resources are

limited and because private contractors often possess con-

siderable expertise and experience with certain industrial

processes of inspection interest (id. at 60a). If EPA may

not use the services of contractor-representatives, it will be

obliged to hire employees who possess the requisite techni-

cal expertise. Because such expertise may be industry-

specific, the hiring of numerous experts, each possessing a

narrow technical specialty may be required, even though

the services of such exnerts are not necessarily required on

a full-time basis. Accordingly, the decision of the court of

clearest indication of EPA's construction of the term “authorized rep-

resentative” is found in the agency's conduct. In addition, since its cre-

ation in late 1970, EPA has sought and received appropriations for the

use of contractors to provide technical support for its enforcement re-

sponsibilities: See Second Supplemental Appropriations for Fiscal

Year 1971; Hearings on H.R. 8191 Before the Senate Comm. on Appro-

priations, 9ist Cong., Ist Sess. 1626 (1971). See also Agricul-

ture —Environmental and Consumer Protection Appropriations for

1973: Hearings Before a House Subcomm. on Appropriations of the

Comm. on Appropriations, 92d Cong., 2d Sess., Pt. 5, at 471-506

(1972). EPA's interpretation of the term “authorised representative”

employed in Section 114 of the Clean Air Act is also reflected in the

published administrative history of EPA's procedures for handling con-

fidential business information. See 40 Fed. Reg. 21990 (1975); 48 Fed.

Reg. 40007 (1978). We note, as well, that in considering amendments

to the C:ean Air Act, and to Section 114 in particular in 1977, Congress

made no effort to alter EPA's use of contractors as authorized

representatives.

46

appeals is likely to restrict EPA’s ability to fulfill its statu-

tory duties in the most efficient manner.

B. Sufficient Safeguards Exist to Protect Against Im-

proper Disclosure of Trade Secrets

The Sixth Circuit’s opinion reflects an unfounded appre-

hension that permitting the Administrator to secure techni-

cal support from contractor personnel during overview in-

spections could compromise trade secrets of a source

subject to inspection (see Pet. App. 33a).2* We note at the

threshold that the court of appeals’ concerns are its own

and not Congress’. As explained above (page 38), Section

114(c) of the Clean Air Act generally prohibits public disclo-

sure of trade secrets obtained in the course of a Section

114(a)(2) inspection, but permits disclosure to agency

contractor-representatives providing technical assistance to

the agency in carrying out the provisions of the Act. Plain-

ly, concern about disclosure of proprietary information by

contractor-representatives did not inform Congress’

crafting of Section 114.

In any event, EPA fully shares the court of appeals’ so-

licitude for the protection of confidential business informa-

tion. The agency has established adequate safeguards

against improper disclosure of trade secrets by contractor-

representatives. Pursuant to regulations of general applica-

bility, 41 C.F.R. 15-7.350-1 and -2, EPA’s contract with

PEDCo requires that trade secrets and similar information

be kept confidential. A confidentiality agreement between

PEDCo and its employees expressly forbids disclosure of

confidential information. Under that agreement, employees

are subject to dismissal as well as to liability for any

damages incurred by PEDCo in consequence of any

* The court of appeals’ statement (Pet. App. 42a-43a), in denying

EPA's petition for rehearing en banc, that EPA had not demonstrated

that it “requires the services of a private contractor who is a competi-

tor of Stauffer with conflicting interests who may have an axe to grind

and may be interested in obtaining trade secrets of Stauffer” is totally

without record support. The district court remarked correctly that

“{ijt does not appear in this case * * * that PEDCo Environmental,

Inc. was in direct competition with Stauffer” (Pet. App. 54a).

47

willful breach of confidentiality.*4 Under EPA regulations,

the private contractor agrees that an “affected business

having an interest in information concerning it”—i.e., a

source subject to inspection—is entitled to third-party ben-

eficiary status under any such confidentiality agreement

and may enforce the agreement against any breaching em-

ployee. 40 C.F.R. 2.301(h)(2)(ii(C). In addition, a powerful

incentive for scrupulous observance of confidentiality re-

quirements is provided by agency regulations that provide

that breach of confidentiality is grounds for debarment of

the contractor or the employee responsible. 40 C.F.R.

2.211(d). As the district court found, the combined effect of

these safeguards is “sufficient protection against disclo-

sure” (Pet. App. 53a).

CONCLUSION

The judgment of the court of appeals should be reversed.

Respectfully submitted.

Rex E. LEE

Solicitor General

MARY E. WALKER

Acting Assistant Attorney General

Loulis F. CLAIBORNE

Deputy Solicitor General

JOSHUA I. SCHWARTZ

Assistant to the Solicitor General

DIRK D. SNEL

JUDSON W. STARR

KATHLEEN P. DEWEY

Attorneys

A. JAMES BARNES

Acting General Counsel

CHRISTOPHER C. HERMAN

Attorney

Environmental Protection Agency

JUNE 1983

‘

4 The pertinent portions of the confidentiality agreement between

PEDCo employees and PEDCo are reproduced at Pet. App. 53a n.5.

la

APPENDIX

Section 114 of the Clean Air Act, 42 U.S. C. (Supp. V)

7414, provides in pertinent part:

Recordkeeping, inspections, monitoring, and entry

(a) Authority of Administrator or authorized

representative

For the purpose (i) of developing or assisting in the

development of any implementation plan under section

7410 or section 7411(d) of this title any standard of

performance under section 7411 of this title, or any

emission standard under section 7412 of this title, (ii)

of determining whether any person is in violation of

any such standard or any requirement of such a plan,

or (iii) carrying out any provision of this chapter (ex-

cept a provision of subchapter II of this chapter with

respect to a manufacturer of new motor vehicles or

new motor vehicle engines)—

(1) the Administrator may require any person who

owns or operates any emission source or who is sub-

ject to any requirement of this chapter (other than a

manufacturer subject to the provisions of section

7525(c) or 7542 of this title) with respect to a provi-

sion of subchapter II of this chapter to (A) establish

and maintain such records, (B) make such reports,

(C) install, use, and maintain such monitoring equip-

ment or methods, (D) sample such emissions (in ac-

cordance with such methods, at such locations, at

such intervals, and in such manner as the Adminis-

trator shall prescribe), and (E) provide such other

information as he may reasonably require; and

(2) the Administrator or his authorized represent-

ative, upon presentation of his credentials—

(A) shall have a right of entry to, upon, or

through any premises of such person or in which

any records required to be maintained under par-

agraph (1) of this section are located, and

(B) may at reasonable times have access to and

copy any records, inspect any monitoring equip-

ment or method required under paragraph (1),

and sample any emissions which such person is re-

quired to sample under paragraph (1).

2a

x = =x x =

(c) Availability of records, reports, and information

to public; disclosure of trade secrets

Any records, reports or information obtained under

subsection (a) of this section shall be available to the

public, except that upon a showing satisfactory to the

Administrator by any person that records, reports, or

information, or particular part thereof (other than

emission data), to which the Administrator has access

under this section if made public, would divulge meth-

ods or processes entitled to protection as trade secrets

of such person, the Administrator shall consider such

record, report, or information or particular portion

thereof confidential in accordance with the purposes of

section 1905 of title 18, except that such record, re-

port, or information may be disclosed to other officers,

employees, or authorized representatives of the

United States concerned with carrying out this chap-

ter or when relevant in any proceeding under this

pelt

(d) Notice of proposed entry, inspection, or

monitoring

(1) In the case of any emission standard or limitation

or other requirement which is adopted by a State, as

part of an applicable implementation plan or as part

of an order under section 7413(d) of this title, before

carrying out an entry, inspection, or monitoring un-

der paragraph (2) of subsection (a) of this section

with respect to such standard, limitation, or other

requirement, the Administrator (or his representa-

tives) shall provide the State air pollution control

agency with reasonable prior notice of such action,

indicating the purpose of such action. No State

agency which receives notice under this paragraph

of an action proposed to be taken may use the infor-

mation contained in the notice to inform the person

whose property is proposed to be affected of the

proposed action. If the Administrator has reason-

able basis for believing that a State agency is so

using or will so use such information, notice to the

agency under the paragraph is not required until

such time as the Administrator determines the

agency will no longer so use information contained

—

3a

in a notice under this paragraph. Nothing in this

section shall be construed to require notification to

any State a of any action taken 7 the Admin-

istrator with respect to any standard, limitation, or

other requirement which is not part of an applicable

implementation plan or which was promulgated by

the Administrator under section 7410(c) of this title,

(2) Nothing in paragraph (1) shall be construed to

provide that any failure of the Administrator to

eee gd with the requirements of such paragraph

shall be a defense in any enforcement action brought

by the Administrator or shall make inadmissible as

evidence in any such action any information or mate-

rial obtained notwithstanding such failure to comply

with such requirements,

vy