Amicus Curiae Brief — General Motors Corp. v. United States

No. 89-369

IN THE SUPREME COURT OF THE UNITED“SPATES™""-~--

OCTOBER TERM, 1989

GENERAL MOTORS CORPORATION, Petitioner,

V.

UNITED STATES OF AMERICA, Respondent.

ON WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE FIRST CIRCUIT

BRIEF AMICUS CURIAE

SERVICE STATION DEALERS OF AMERICA

Dimitri G. Daskalopoulos

Counsel of Record

325 Pennsylvania Avenue, S.E.

Washington, D.C. 20003

202- 675-6300

January 18, 1990

No. 89-369

IN THE SUPREME COURT OF THE UNITED STATES

OCTOBER TERM, 1989

GENERAL MOTORS CORPORATION, Petitioner,

Vv.

UNITED STATES OF AMERICA, Respondent.

ON WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE FIRST CIRCUIT

BRIEF AMICUS CURIAE

SERVICE STATION DEALERS OF AMERICA

Dimitri G. Daskalopoulos

Counsel of Record

325 Pennsylvania Avenue, S.E.

Washington, D.C. 20003

202- 675-6300

January 18, 1990

TABLE OF CONTENTS

PPP TTTITTTTTTT Le

Interest of Amicus “ene oeeeeneeeeeeeneees ¢

Summary of Argument .......2.ceeeee cece

Argument *“e @©e#weeeneee eee#e#eeeeeeeee#*e #*# © # © ©

I. THE STATES HAVE PRIMARY

If.

Iilt.

AUTHORITY FOR CONTROL OF

AIR POLLUTION SOURCES

WITHIN THEIR BOUNDARIES

UNDER THE CLEAN AIR ACT ......

EPA MUST ACT ON A

PROPOSED SIP REVISION

WITHIN FOUR (4) MONTHS OF

THE APPLICATION BY THE

STATE .ccccccccccccssceesssees

THE FIRST CIRCUIT'S

PROPOSED REMEDY FOR EPA

INACTION IS UNWORKABLE .......

A. The Citizen's Suit .......

B. Reductions In

Potential Penalties

Is Also Not An

Appropriate Remedy

For The Adminis-

trator’s Inaction ....cece

IV. ONLY THE ENFORCEMENT BAR

AS ADOPTED BY THE FIFTH

CIRCUIT IN AMERICAN

CYANAMID PROPERLY

PRESERVES THE ROLE OF THE

STATES AND IS FAITHFUL TO

THE PURPOSES OF THE ACT ...... 19

Conclusion oenreneneeneeseneeneeneenee eee ee em—UcmeRrmUcCrChUCUchhUCUchCUrh!}LUhHhUhF 21

STATEMENT OF INTEREST

With the consent of the parties, the

Service Station Dealers of America (herein-

after SSDA) respectfully submits this Brief

Amicus Curiae in support of the Petitioner.

The SSDA is the voice of America's sixty

thousand (60,000) independent retail gasoline

dealers. It consists of forty-three (43)

State and regional dealer associations. The

SSDA believes that its interests in the case

have not been specifically represented by any

of the parties nor their supporting amaci.

Specifically, the SSDA brings the perspective

of the small business group most affected by

the Clean Air Act to this case. SSDA members

typically own and/or operate a single service

Station, which is the sole means of sup-

porting their families. For purposes of the

Clean Air Act, they would be classified as

non-major stationary sources. Both the

Petitioner, General Motors, as well as many

of its supporting amici are major stationary

sources and are large businesses which would

have greater, but by no means adequate,

resources to utilize the remedy suggested by

the First Circuit for EPA's inaction on a

proposed State SIP revision. Specifically,

the SSDA is very concerned that the proposal

that a small stationary source is some how

adequately protected from EPA inaction by its

ability to file a mandamus action in a

District Court to compel the EPA adminis-

trator to act on a SIP revision. This remedy

that simply does not grant any real world

relief and if anything, for a small business

could be classified as a phyrraic victory.

The litigation costs alone would be too great

for a small business to bear.

According to EPA's own data, the typical

SSDA member firm has a medium net worth of

Only Eighty-one Thousand and 00/100

($81,000.00) Dollars. To suggest, as the

First Circuit did, that dealers spend these

limited resources pursuing actions to compel

the EPA administrator to perform a drty which

he or she clearly has to perform under the

law is simply not facing reality. Indeed, we

further question whether Congress ever

intended that the limited resources of small

business such as those represented as SSDA be

spent on enforcement actions to compel the

administrator to perform a non-discretionary

duty, as opposed to investing in those

control strategies that would most

expeditiously produce attainment of the

National Ambient Air Quality Standards in the

many non-attainment areas across the country.

Thus, while in a very broad sense the

interest of the SSDA coincide with those of

the Petitioner and some of its supporting

amici, the SSDA approaches the issues

presented from a perspective not represented

in the case and thus, has filed the following

brief.

SSDA would add that many of its members

run small auto body and paint shops affected

by the regulations at issue in the case at

bar.

SUMMARY OF ARGUMENT

1. The States have the primary

responsibility for the control of air

pollution sources within their boundaries

under the Clean Air Act; allowing EPA to

delay approval or disapproval of revisions to

the State's plan beyond the four (4) month

deadline, upsets the carefully crafted

Statutory provisions.

2. The plain language of the statute

as well as its legislative history and the

unanimous holdings of the Courts of Appeal to

consider it lead to the conclusion that the

four (4) month deadline for EPA to approve or

disapprove a State's SIP is equally

applicable to proposed revisions to that SIP.

De The First Circuit's proposed

two-pronged remedy for EPA's failure to

observe the four (4) month deadline is

unworkable. First, the citizen's suit remedy

would require a company to potentially expose

itself to a fine of One Million Five Hundred

Thousand and 00/100 ($1,500,000.00) Dollars,

and in practice, litigation costs alone make

this impractical for a small business such as

those represented by SSDA.

The reduction of penalty remedy is

something that is left solely at the

discretion of the District Court and is not

mandatory as are the statutory mitigating

factors.

er ed

4. Only the enforcement bar rule, as

adopted by the Fifth Circuit, gives full

effect to Congressional purposes.

ARGUMENT

I. THE STATES HAVE PRIMARY AUTHORITY

FOR CONTROL OF AIR POLLUTION

SOURCES WITHIN THEIR BOUNDARIES

UNDER THE CLEAN AIR ACT.

Of principal concern to the SSDA in the

case is the position taken by EPA that it can

withhold its approval of a proposed revision

to a State implementation plan and thus, in

effect, “pocket veto" such revisions, while

at the same time seeking penalties against

those corporations and sole proprietorships,

that may act in good faith reliance on such

proposed revisions.

When dealing with the regulation of

stationary sources under the Clean Air Act,

it is not unfair to say that the States are

the dog and the EPA is the tail.

The plain language of the Act makes

clear that “each State shall have the primary

responsibility for assuring air quality

within the entire geographic area comprising

such State." 42 U.S.C. $7407(a) (emphasis

added). Congress has repeatedly reaffirmed

this primary role of the States in its

periodic revisions of the Act.

For example, in the 1977 revisions to

the Act, Congress enacted a method by which

States could grant temporary relief from SIP

requirements in the form of “delayed

compliance orders", the authority for which

is now found at 42 §7413(d). The legislative

history of this provision states that it was

enacted in large part in order to “reaffirm

the primary role of the States in the

formulation and enforcement of State

a es

implementation plans." See, House Report No.

95-294, 95th Congress, First Session, (1977),

re-printed in 1977 U.S. Code Congressional

and Administrative News 1077, 1135-1136.

Thus, as this Court pointed out in Train

v. Natural Resources Defense Council, 421 U.S

60 (1975):

"The agency is plainly charged by

the Act with the responsibility for

setting National Ambient Air

Standards. Just as plainly,

however, it is relegated by the Act

to a secondary role in the process

of determining and enforcing the

specific, source by source

admission limitations which are

necessary if the national standards

that are set are to be met ... the

Act gives the agency no authority

to question the wisdom of a State's

choice of admission limitations if

they are part of a plan which

satisfies the standards of

$110(a)(2) ... S80 long as the

ultimate effect of a State's choice

of admission limitations is in

compliance with the national

standards for ambient air, the

State is at liberty to adopt

whatever mix of admission standards

it deems best suited to its

particular situation."

421 U.S. at 79 (1975).

Te

eS eee

Finally, it should be pointed out that

if a SIP meets the check list of criteria set

out in 42 U.S.C. $7410(ad(2), the

administrator has no choice but to approve

such SIP or a revision thereto.

Allowing EPA to procrastinate beyond the

statutorily prescribed four (4) month

deadline, as discussed in detail infra,

subserviates the State’s to EPA, and grants

the Federal Government the primary role that

the plain language of the Act leaves for the

States.

For this policy reason alone, this Court

should affirm the holding of the First

Circuit that the four (4) month limitation

applies to EPA review of SIP revisions, as

well as to the original SIPs themselves.

II. EPA MUST ACT ON A PROPOSED SIP

REVISION WITHIN FOUR (4) MONTHS OF

THE APPLICATION BY THE STATE.

The threshold issue in this case, as

framed by the First Circuit, is “whether the

|

|

)

Act imposes a four (4) month deadline on EPA

review of SIP revisions." U.S. v. Gener

Motors Corporation, 876 F.2d 1060, 1065 (lst

Cir. 1989). The First Circuit correctly held

that the four (4) month limitation does

indeed apply to SIP revisions as well as the

EPA review of original SIPs. Id. at 1066.

To begin with, Amicus believes that this

interpretation is supported by the only

reasonable interpretation of the plain

language of the Act. Specifically, the Act

requires that EPA either approve or dis-

approve of an original SIP submitted by a

State within a hundred twenty (120) days of

receipt by EPA of the SIP. 42 U.S.C.

$7410(a)(2). Next, $7410(a)(3)(A) dealing

with SIP revisions, expressly incorporates

the requirements of §7410(a)(2).

Therefore, the First Circuit was clearly

correct in following its sister circuits in

10

holding that the one hundred twenty (120) day

deadline for EPA action on a SIP revision is

incorporated into 42 U.S.C. $7410(a)(3)(A).

Moreover, 42 U.S.C. $7410(g)(1)

discusses circumstances when the EPA

administrator has not approved or disapproved

the SIP revision within the “required four

(4) month period". It should be noted that

the First Circuit did not examine the plain

implication of §7410(g)(1) in reaching its

decision.

While Amicus believes that the Court

need go no further than the plain language of

the statue in order to affirm the bolding of

the First Circuit, it is important to note

that in at least one Federal Register notice

concerning regulations governing penalties

for non-compliance pursuant to 42 U.S.C.

§7420, EPA itself has acknowledged that the

four (4) month Limitation applies to SIP

ll

revisions. See, 50 Federal Register 36,732

et. seg. at 36, 733 (September 9, 1985).

Finally, it is important to note that

there is now unanimity within the circuits

that the Clean Air Act imposes a four (4)

month deadline on EPA review of proposed SIP

revisions. See Council of Commuter

Organizations v. Gorsuch, 683 F.2d 648,

651-52 N.2 (2nd Cir. 1982); Duquesne Light

Company v. EPA, 698 F.2d 456 (D.C. Cir.

1983); American Cyanamid v. U.S. Environ~

mental Protection Agency, 810 F.2d 493, 495

(Sth Cir. 1987); United States v. General

Motors Corporation, 876 F.2d 1060, 1066 (lst

12

Cir. 1989); United States v. Alcan Oil

Products, 889 F.2d 1513 (6th Cir. 1989).

III. THE FIRST CIRCUIT'S PROPOSED REMEDY

FOR EPA INACTION IS UNWORKABLE.

The First Circuit in rejecting the

enforcement bar adopted by the Fifth Circuit

in American Cyanamid attempted to steer what

it termed a “middle course between the two

extremes, attempting to permit trial courts

1 At one time it appeared that the Sixth

Circuit may not have required EPA

compliance with the four (4) month rule.

See United States v. National Steel

Corporation, 76? F.2d 1176, 1182-1183

N.1 (6th Cir. 1985). The Sixth Circuit

rejected this earlier dicta in its

recent Alcan decision. Amicus hereby

incorporates by reference the arguments

made by Petitioner on this point.

Suffice it to say that if the Court

should reverse the decision below and

hold that the four (4) month limitation

does not apply to EPA review of SIP

revisions, we would truly be ina

situation where the tail, in this case

EPA, was truly wagging the dog, the

States.

13

to take account of the circumstances of each

case and hopefully accommodate both the

State's needs and the public's desire for

clean air." U.S. v. General Motors Corpor-

ation, 876 F.2d 1060 at 1067. The First

Circuit suggested two possible remedies for

EPA inaction. The first was for the affected

company to bring a citizen's suit pursuant to

42 U.S.C. $7604(a)(2) in order to compel

agency action. Id. The second remedy it

proposed was for the District Court to

consider "the reasonableness of the agency's

delay and the prejudice, if any, suffered by

the company as a result." Id. We discuss

the problems with each of these remedies

separately.

A. The Citizen's Suit Remedy.

In order to assess the possible

efficiency of the “citizen's suit” remedy

proposed by the First Circuit, it is

14

necessary to examine the statutory language

authorizing such suits which is found at 42

U.S.C. $7604.

Specifically, $7604(a)(2) allows any

person to commence a civil suit on his behalf

against the Administrator where there is a

failure of the Administrator to perform an

act or duty which is non-discretionary under

the Act. §7604(b)(2) provides that no such

action may be maintained unless the proposed

Plaintiff has given the Administrator sixty

(60) days notice of such proposed action.

This notice in turn cannot be provided

until the statutory period within which the

Administrator may act has run out, in the

case of a proposed SIP revision, one hundred

twenty (120) days.

Thus, a major stationary source must put

itself at risk of a fine of up to One Million

Five Hundred Thousand and 00/100

15

($1,500,000.00) Dollars before it could even

begin to avail itself of the remedy proposed

by the First Circuit.

Not only must such a source risk such

potential exposure, the infliction of

litigation costs alone may well be more than

such source may bear. This is particularly

true of relatively small “major sources."

Amicus can scarcely believe that

Congress intended for those sources making

good faith, best efforts to reduce pollution,

would be forced to squander their resources

on actions to compel the administrator to

perform non-discretionary duties, when their

limited resources would be better spent on

pollution abatement. This is particularly

true in the case of relatively small

businesses.

It should be noted that both the Sixth

Circuit in Alcan, as well as the D.C. Circuit

16

———

in Duguesne Light, both took the view that

the “citizen's suit" remedy adopted herein

by the First Circuit would simply not be an

effective remedy for EPA inaction. SSDA

fully agrees with the Sixth and D.c. Circuits

and strongly urges the Court to reject the

idea that a citizen's suit is an effective .

remedy for agency inaction in the present

context.

B. Reductions In Potential Penalties

Is Also Not An Appropriate Remedy

For The Administrator's Inaction.

In reaching its holding tt t District

Courts should consider the reasonableness of

the Agency's delay and the prejudice, if any,

to a company by the Agency's inaction in

determining what penalties should be imposed

under the Act, the First Circuit did not

accurately quote §113 (42 U.S.C. $7413) of

the Clean Air Act.

17

“—

Specifically, the First Circuit quoted

that section of the Act as expressly allowing

courts to “take into consideration the size

of the business, economic impact of the

penalty on the business and the seriousness

of the violation in determining an

appropriate penalty." 876 F.2d at 1068.

The distinction between the factors

enumerated by the statute and the proposed

remedy of the First Circuit is that the

factors Listed by the statute are mandatory,

that is, §$113(b) of the Act states that

District Courts “shall take into

consideration the size of the business, the

economic impact of the penalty on the

business and the seriousness of the

violation."

On the other hand, the balancing test

proposed by the First Circuit would be purely

discretionary with the trial court. Thus, a

18

“—

trial court would have no duty to reduce the

penalties, and even if it did exercise its

discretion to reduce such penalties, the

penalties would surely be greater than that

which a small business, such as those

represented by SSDA members, could absorb.

In sum, the hope that a District Court

may reduce a penalty due to EPA inaction, is

not something that any rational businessman

would risk both his Livelihood and those of

his or her employees over. It is not a

workable remedy and the Court should reject

it.

IV. ONLY THE ENFORCEMENT BAR AS ADOPTED

BY THE FIFTH CIRCUIT IN

Sean STATES. pansenvie ter

E STATES AND IS FAITHFUL

TO THE PURPOSES OF THE ACT

The SSDA strongly urges the Court to

adopt the pos.tion taken by the Fifth Circuit

in American Cyanamid and require EPA to

19

either accept or reject a SIP revision before

it may bring an enforcement action against

the company that is in compliance with such

State authorized revisions. SSDA can add

little to the cogent arguments already made

by Petitioner and the other amici in this

regard.

However, we would point out that there

are similarities in this situation to other

areas of the law. For example, under the

antitrust laws, a party which takes actions

which may be anti-competitive, yet are

compelled by the State, are shielded from

antitrust liability by virtue of the state

action Doctrine. This was reaffirmed as

recently as this Court's 1985 decision in the

Southern Motor Carriers case. Similarly, it

seems most inequitable to subject a company

that acts pursuant to State authorization by

virtue of a SIP revision under the Clean Air

20

Act to be subject to penalties. It would be

Similar to allowing the Department of Justice

to unilaterally define substantive antitrust

offenses for which a party, acting under

State compulsion, could be held liable. We

thus strongly urge adoption of the Fifth

Circuit rule.

CONCLUSION

The judgment of the First Circuit should

be affirmed as to the issue of whether the

four (4) month rule applies to EPA approval

of proposed SIP revisions. The judgment

should be reversed as to the issue of the

appropriate remedy for the agency inaction

upon such SIP revision.

Respectfully submitted,

Dirlig’ J) Dase

Dimitr . Das opoulos

Counsel of Record for

Amicus Service Station

Dealers of America

21

CERTIFICATE OF SERVICE

I hereby certify that on this 18th day

of January, 1990, I mailed, first class mail,

postage prepaid, three (3) copies of this

Brief Amicus Curiae to: Theodore L. Garrett,

Covington and Burling, 1201 Pennsylvania

Avenue, N.W., P. O. Box 7566, Washington,

D.C., 20044 (Counsel of Record for

| Petitioner, General Motors Corporation), and

to: Kenneth W. Starr, Solicitor General,

| U.S. Department of Justice, Washington, D.C.,

. 20530 (Counsel of Record for Respondent,

United States of America). I further

certifiy that all parties required to be

served have been served.

Dimitri G. Das °