Reply Brief — Whitman v. American Trucking Assns., Inc.

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APR 1° e199

No. 99-1257}

In the Supreme Court of the United States

CAROL M. BROWNER, ADMINISTRATOR OF

THE ENVIRONMENTAL PROTECTION AGENCY,

ET AL., PETITIONERS

v.

AMERICAN TRUCKING ASSOCIATIONS, ET AL.

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

REPLY BRIEF FOR THE PETITIONERS

SETH P. WAXMAN

Solicitor General

Counsel of Record

Department of Justice

Washington, D.C. 20530-0001

202) 514-2217

GARY S. GUZY

General Counsel

- Environmental Protection

Agency

Washington, D.C. 20460

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TABLE OF AUTHORITIES

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Lead Indus. Ass'n v. EPA, 647 F.2d 1130 (D.C. Cir.

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In the Supreme Court of the Gnited States

No. 99-1257

CAROL M. BROWNER, ADMINISTRATOR OF

THE ENVIRONMENTAL PROTECTION AGENCY,

ET AL., PETITIONERS

v.

AMERICAN TRUCKING ASSOCIATIONS, ET AL.

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

REPLY BRIEF FOR THE PETITIONERS

The federal government’s petition for a writ of certiorari

has prompted an extraordinary array of responses. The

Commonwealth of Massachusetts and the State of New

Jersey (which have filed their own joint petition, No. 99-1263

(Mass. Pet.)) and the American Lung Association (which has

filed its own petition, No. 99-1265 (ALA Pet.)) fully endorse

the government’s petition. Likewise, the States of New

York, Connecticut, Maryland, Maine, New Hampshire, Penn-

sylvania, Rhode Island and Vermont, as amici curiae

(Eastern States Am. Br.), unqualifiedly support review. The

State of Ohio does not oppose review of the nondelegation

issue, while the States of Michigan and West Virginia sup-

port review to the extent urged by the American Trucking

Associations, et al. (Midwest States Br. 3). The American

Trucking Associations, et al., which consists of a group of

(1)

2

industrial interests, says that “[a] properly reformulated

version of the Government’s first question is worthy of re-

view” (ATA Br. 1; see also Mfrs. Alliance Am. Br. 17).

Appalachian Power Co., et. al. (APC) and the National Stone

Association, et al. (NSA), which represent other industrial

interests, and the Mercatus Center, an academic organi-

zation, oppose review.

As these wide-ranging responses suggest, the court of

appeals has decided an extraordinarily important matter.

The court ruled that Section 109 of the Clean Air Act (CAA),

42 U.S.C. 7409, as interpreted by EPA in setting revised

National Ambient Air Quality Standards (NAAQS) for ozone

and particulate matter (PM), effects an unconstitutional

delegation of legislative authority. Pet. App. 4a. In addition,

the court has reached out to decide matters not yet before it

and ruled that EPA may enforce the revised ozone NAAQS

only “in conformity with” CAA provisions that were enacted

to serve a different purpose. /d. at 8la. The responses to

the government’s petition leave no doubt that the challenged

rulings, which divided the court of appeals, have great

practical importance to the federal and state governments,

industry, and the public at large. But of equal moment,

those rulings present fundamental issues respecting the

power of federal courts and the scope of judicial review.

This case clearly warrants the Court’s review.

1. The majority of responses to the government’s peti-

tion agree that this Court should review the nondelegation

ruling. That ruling deeply divided the court of appeals—five

of the nine judges who participated in the en banc poll voted

in favor of en bane review. Those judges not only concluded

that the ruling raised a question of exceptional importance,

see Fed. R. App. P. 35(a), but also condemned the ruling in

strong terms, calling it “fundamentally unsound,” Pet. App.

92a (Silberman, J., dissenting from denial of rehearing en

banc), and a “depart(ure] from a half century of separation-

of-powers jurisprudence,” id. at 99a (Tatel, J., dissenting

3

from denial of rehearing en banc). Correspondingly, the sug-

gestions by those who oppose review that the court of

appeals’ decision is actually “unexceptional,” “pedestrian”

and presents “nothing remarkable” (APC Br. 11, 13, 14)

warrant some skepticism.

Although the industrial groups criticize the government

rulemaking (and offer less-than-balanced depictions of the

government’s decision and the rulemaking record, e.g., APC

Br. 4-5, 12; ATA Br. 4-7), neither they nor their amici

attempt to defend the court of appeals’ decision on its own

terms. For example, ATA suggests that “a properly re-

formulated version of the Government’s first question”—

presumably, as ATA stated it (ATA Br. i)—would be

“worthy of this Court’s review.” /d. at 1. But the govern-

ment’s formulation of the question presented (Pet. I) is a

virtual paraphrase of the court of appeals’ express holding.

The court stated, “we find that the construction of the Clean

Air Act on which EPA relied in promulgating the NAAQS at

issue here effects an unconstitutional delegation of legis-

lative power.” Pet. App. 4a. ATA’s preferred formulation,

by contrast, avoids any mention of the court of appeals’

nondelegation rationale. See ATA Br. i; see also Midwest

States Br. i; APC Br. i.

There is good reason why respondents are unwilling to

defend the court of appeals’ holding—that holding is indeed

“fundamentally unsound.” Pet. App. 92a (Silberman, J.,

dissenting from denial of rehearing en banc). ATA concedes,

and APC does not question, that the CAA “itself” is consti-

tutional. ATA Br. 15 (Section 109 is “undisputedly” consti-

tutional); APC Br. 8 (“The court did not hold the statute

itself unconstitutional.”). To suggest otherwise would truly

“depart from a half century of separation-of-powers juris-

prudence.” Pet. App. 99a (Tatel, J., dissenting from denial of

rehearing en banc). But ATA and APC must then face the

quandary of explaining how, under the nondelegation doc-

4

trine, an agency could make an “undisputedly” constitutional

statute unconstitutional.

APC and ATA ultimately defend the court of appeals’

decision by recharacterizing it. APC suggests that “the con-

stitutional ‘nondelegation’ rationale for remand in this case

might as well have been articulated as ‘arbitrary and capri-

cious’ agency action” and that the Court should be satisfied

with the end result here “[wJhatever the rationale.” APC

Br. 12, 13 (footnote omitted). ATA argues that the court

merely applied “constitutional avoidance and nondelegation

principles” as canons of statutory construction and produced

an outcome that is “functionally indistinguishable from the

work-a-day remands courts issue every time they invalidate

an unreasonable agency interpretation under Chevron

[U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467

U.S. 837 (1984))}.” ATA Br. 10, 14. Those salvage efforts are

unavailing.

Contrary to APC’s and ATA’s suggestions, the rationale

of the court of appeals’ decision does matter. The non-

delegation doctrine, the arbitrary-and-capricious standard,

and the Chevron doctrine each serve a different purpose.

They are not interchangeable, and substituting one for the

other ignores the logic and diminishes the utility of each.

See Pet. 16-17; Pet. App. 94a-96a (Silberman, J., dissenting

from rehearing en banc). Moreover, even if rationales were

of no moment, the court of appeals’ ruling cannot be sus-

tained on either of the bases that APC and ATA suggest.

It is quite clear from the court of appeals’ decision that the

panel majority did not equate its constitutional analysis with

review under the “arbitrary and capricious” standard. The

court of appeals noted it had repeatedly held, under the

arbitrary and capricious standard, that

when there is uncertainty about the health effects of

concentrations of a particular pollutant within a parti-

cular range, EPA may use its discretion to make the

5

“policy judgment” to set the standards at one point

within the relevant range rather than another. NRDC v.

EPA, 902 F.2d 962, 969 (D.C. Cir. 1980); American

Petroleum Inst. v. Costle, 665 F.2d 1176, 1185 (D.C. Cir.

1981); Lead Industries [|Ass’n v. EPA, 647 F.2d 1130,)

1161 (D.C. Cir. 1980).

Pet. App. 12a. The court imposed a constitutional require-

ment beyond what the arbitrary and capricious standard

would call for—namely, a “determinate criterion for drawing

lines” (id. at 6a)—because, in the court’s view, “none of those

panels [in the previous cases] addressed the claim of undue

delegation that we face here.” /d. at 12a. Plainly, the court

ruled that the nondelegation doctrine imposes constitutional

imperatives in addition to the requirements of the arbitrary

and capricious standard. That holding also explains why the

court found that it had to postpone a full review of the

NAAQS under the arbitrary and capricious standard. /d.

at 5a.

It is also quite clear that the court of appeals did not

employ nondelegation principles merely as a “construction

eanon{}” (ATA Br. 10) to avoid a constitutional issue. ATA

claims that the court “reject{ed] EPA’s interpretation under

Chevron” (ibid.), but the panel majority’s discussion does not

even mention the Chevron doctrine, and the panel’s opinion

on rehearing does so only as an epilogue, suggesting that the

agency has discretion on remand to satisfy the court’s non-

delegation requirement. Pet. App. 75a-76a. Indeed, the

panel specifically disclaimed departing from the relevant

circuit precedent upholding EPA’s interpretive discretion.

See Pet. 10 n.4. But more fundamentally, ATA’s argument is

logically inconsistent. If the relevant provisions of the CAA

are “undisputedly” constitutional (ATA Br. 15)—and they

are, see Pet. 11-16—then there is no need for a court to in-

voke the nondelegation doctrine to “avoid” a constitutional

issue. The issue before the court of appeals was whether the

6

agency misinterpreted the CAA or unreasonably exercised

the discretion conferred by the CAA. The nondelegation

doctrine has no bearing on those questions.

In short, APC’s and ATA’s arguments highlight why the

court of appeals’ analysis is indefensible. Furthermore, they

provide a preview of the Pandora’s Box of doctrinal issues

that will emerge if the decision is left uncorrected. The

Court should therefore grant the government’s petition,

make clear that the nondelegation doctrine should be con-

fined to its proper role as a separation-of-powers constraint

on Congress, and remand the case for the court of appeals to

analyze the statutory and regulatory issues under the

correct legal standards. See Pet. 16-17.

2. APC, ATA, and the Midwest States argue that this

Court should not review the court of appeals’ further ruling

that “EPA can enforce a revised primary ozone NAAQS only

in conformity with Subpart 2.” Pet. App. 8la. As we explain

in our petition, Subpart 2 of Part D, Subchapter I of the

CAA, 42 U.S.C. 7511-7511f, provides a detailed statutory

scheme, including attainment deadlines, for implementing

the ozone NAAQS standard that was in effect in 1990. Pet.

4-5, 26. But Subpart 2 does not unambiguously address how

to implement the revised ozone standards, which will neces-

sarily require different attainment deadlines and imple-

mentation schedules. Pet. 27-29 & n.16; see also Mass. Pet.

5-8, 21-25. The question of how to implement the revised

ozone NAAQS should be a matter for EPA and the States to

address through authoritative rules that are subject to

notice, comment, aad judicial review. EPA has not yet

conducted those rulemakings, and there was accordingly no

occasion for the court of appeals to make broad pronounce-

ments limiting EPA’s authority to implement the revised

ozone NAAQS. Pet. 19-30.

APC’s and ATA’s defense of the court of appeals’ action

demonstrates why the matter warrants this Court’s review.

They assert that the court of appeals reviewed final and ripe

7

agency action, but the two sources of supposedly final

agency action on which they rely are: (1) EPA’s preamble

statements responding to industry comments that Subpart 2

provisions bar revision of the NAAQS; and (2) a final rule

that was not at issue in the judicial proceedings below. See

APC Br. 22-23; ATA Br. 6, 24, 27-28. If judicial review could

be predicated on such bases, there would be an enormous

expansion in unfocused challenges to agency regulatory

programs and a corresponding expansion in the role of the

courts in anticipating and supervising agency activities.

We explain in the petition why preamble statements

generally—and especially the preamble statements that the

court of appeals relied upon here (62 Fed. Reg. 38,856,

38,884-38,885 (1997))—do not constitute final agency action.

Pet. 21-25. EPA has promulgated revised NAAQS that will

be implemented through iater rulemakings. See 40 C.F.R.

50.7 (revised PM NAAQS); 40 C.F.R. 50.10 (revised ozone

NAAQS). Respondents were entitled to challenge the re-

vised NAAQS, and they were entitled to take issue with

EPA’s reasoning, as expressed in the regulatory preamble,

in making those challenges. But EPA’s preamble state-

ments are only the agency’s explanation of the agency’s

action—they are not themselves agency actions that are

independently reviewable. The court of appeals accordingly

had jurisdiction to affirm, set aside or remand the N AAQS,

but once it completed that task, it could not go further and

decide other issues that were not yet before it. See Pet. 21-

25. |

In arguing that this rulemaking involves more, APC and

ATA point to a rule that EPA issued in the ozone rule-

making, 40 C.F.R. 50.9(b), respecting future enforcement of

the 1-hour ozone NAAQS, which the revised 8-hour ozone

NAAQS will replace. See APC Br. 23; ATA Br. 27-28. That

rule states:

8

The 1-hour standards set forth in this section will no

longer apply to an area once EPA determines that the

area has air quality meeting the 1-hour standard. Area

designations are codified in 40 CFR part 81.

40 C.F.R. 50.9(b). EPA issued that rule to relieve areas that

are in compliance with the l-hour ozone NAAQS from the

obligation to comply with both the old 1-hour standard and

the new 8-hour standard. See 62 Fed. Reg. at 38,873.'

APC characterizes 40 C.F.R. 50.9(b) (incorrectly, see note

2, infra) as an “embodi[ment]” of “EPA’s legal conclusion”

about how the revised ozone NAAQS should be imple-

mented, and it argues that EPA’s issuance of that rule

therefore subjects “EPA’s legal conclusion” to judicial

review. APC Br. 23. Respondents fail to reveal, however,

that no one challenged the validity of 40 C.F.R. 50.9(b),

which was a minor component of the ozone rulemaking. The

court of appeals did not review, or even mention, that rule.

Hence, the rule was certainly not the actual predicate for the

court of appeals’ ruling.’

The court of appeals was entitled to rule on how “EPA can

enforce a revised primary ozone NAAQS” (Pet. App. 81a)

only if the parties had placed before the court a specific

challenge to final agency action enforcing that NAAQS. No

such challenge had been presented, and there accordingly

was no basis for the court to address that question. Its

overreaching cannot be justified by post hoc resort to the

' As a consequence of the court of appeal’s decision, EPA has pro-

posed a modification of 40 C.F.R. 50.9(b) to maintain the 1-hour standard

in effect until the ongoing legal challenges are resolved. See 64 Fed. Reg.

57,424 (1999).

2 An additional problem with respondents’ argument is that 40 C.F.R.

50.9(b) is part of, and addresses enforcement of, the old ozone NAAQS.

Compare 40 C.F.R. 50.9 with 40 C.F.R. 50.10. Accordingly, it is not

accurate to characterize 40 C.F.R. 50.9(b) as implementing or enforcing

the revised ozone NAAQS. The rule deals with only one aspect of the

transition from the old ozone standard to the new ozone standard.

9

undiscussed implications of an unchallenged rule. That is

particularly true where that rule merely addresses interim

enforcement of the pre-eristing NAAQS.*

APC’s reliance on 40 C.F.R. 50.9(b) would make sense

only if this Court accepted the contention that judicial re-

view is available on an open-ended basis whenever the

agency expresses a “legal conclusion” somewhere in the rule-

making proceeding. Under that view, the party would not

be required to challenge the particular rule that allegedly

“embodied” that conclusion—it would be enough for the

party simply to take issue with the agency’s general view of

its regulatory authority. See APC Br. 23; see also ATA Br.

27-28. That approach to administrative finality and ripeness

is clearly unsound. The CAA predicates judicial review on

challenges to final agency action. See CAA § 307(b), 42

U.S.C. 7607(b). It does not give the courts unrestricted

license to critique regulatory preambles or to review the

general legal perspectives allegedly “embodied” in un-

challenged regulations.

% Significantly, APC could have challenged 40 C.F.R. 50.9(b) in the

proceedings below, and it should have if it disagreed with that rule. But

APC did not do so because the rule is in industry’s interest—the rule

reduces the regulatory burden on ozone sources. Since that time, an

environmental group has brought a challenge to 40 C.F.R. 50.9(b), and the

government opposed that challenge because it was untimely. See

Environmental Defense Fund (EDF) v. Browner, No. 98-1363 (D.C. Cir.).

Contrary to APC’s assertion (APC Br. 24), the government's position

there is consistent with its position here. Any petitions to review 40

C.F.R. 50.9(b) should have been brought within 60 days of promulgation of

the final rule. See 42 U.S.C. 7607. Neither EDF nor APC nor anyone else

brought a timely judicial challenge to 40 C.F.R. 50.9(b). Rather, APC and

others brought a timely judicial challenge to the revised ozone NAAQS, 40

C.F.R. 50.10. The latter challenge put before the court the question

whether to affirm, invalidate, or remand the revised ozone NAAQS, but it

did not entitle the court to address the subjects of future rulemaking—

including how the revised ozone NAAQS would eventually be enforced.

10

This Court therefore should grant review on tiie Subpart

2 issues. In our view, the better course is to set aside on

finality and ripeness grounds the court of appeals’ ruling

limiting what actions EPA may take in future rulemakings.

But if the Court reaches the merits, there is ample reason to

declare the ruling wrong as a matter of law. See Pet. 27-30;

Mass. Pet. 21-25; ALA Pet. 24-26; Eastern States Am. Br. 6-

11. This Court’s resolution of the matter is warranted based

on its practical importance to the federal government and

the States. The Court’s review takes on added importance

in light of APC’s incongruous interpretation of the court of

appeals’ obscure statement that “EPA can enforce a revised

primary ozone NAAQS only in conformity with Subpart 2”

(Pet. App. 8la). In APC’s view, that statement means that

EPA can promulgate—but not enforce—a revised ozone

NAAQS.*

For the foregoing reasons and the reasons stated in the

petition for a writ of certiorari, the petition should be

granted and consolidated with the petitions in No. 99-1263

and No. 99-1265.

Respectfully submitted.

SETH P. WAXMAN

Solicitor General

GARY S. GUZY

General Counsel

Environmental Protection

Agency

APRIL 2000

4 Notwithstanding the panel’s revisions of its opinion (Pet. App. 79a-

82a) and Judge Tatel’s explanatory concurrence (id. at 89a), APC asserts

that Subpart 2 “must preclude the EPA from requiring areas to comply

either more quickly or with a more stringent ozone NAAQS.” APC Br. 9,

28 (quoting panel opinion, emphasis supplied by APC). APC’s inter-

pretation of the court’s ruling would transform the promulgation of that

NAAQS and judicial review of its promulgation into largely academic

exercises.