Petition for Writ of Certiorari — Engine Mfrs. Assn. v. South Coast Air Quality Management Dist.

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Supreme Court, U.S.

FILED

02 1343 mar 11 2003: VY)

OMCRPF oe CLERE

IN THE -

Supreme Court of the Anited States

ENGINE MANUFACTURERS ASSOCIATION AND

WESTERN STATES PETROLEUM ASSOCIATION,

Petitioners,

SOUTH COAST AIR QUALITY MANAGEMENT DisTRICT, et al.,

Respondents.

Petition for a Writ of Certiorari to the

United States Court of Appeals

for the Ninth Circuit

PETITION FOR A WRIT OF CERTIORARI

JOHN J. SULLIVAN PHIL C. NEAL

GREGORY R. MCCLINTOCK Counsel of Record

MAYER, BROWN, ROWE & MAW JEDR. MANDEL

1909 K Street, N.W. TIMOTHY A. FRENCH

Washington, D.C. 20006 NEAL, GERBER & EISENBERG

(202) 263-3000 Two North LaSalle Street

Suite 2200

Counsel for Petitioner Western Chicago, Illinois 60602

States Petroleum Association (312) 269-8000

Counsel for Petitioner Engine

Manufacturers Association

WILSON-EPES PRINTING CO., INC. -— (202) 789-0096 -— WASHINGTON, D. C. 20001

QUESTION PRESENTED

Section 209(a) of the Clean Air Act expressly preempts any

state or local “standard relating to the control of emissions

from new motor vehicles.” 42 U.S.C. § 7543(a). The First

and Second Circuits have applied this provision to invalidate

state regulations limiting the sale of new motor vehicles with

specified emission characteristics. The Ninth Circuit in this

case has held that a local regulation may impose such restric-

tions on new vehicle purchases. The question presented is:

Whether local government regulations prohibiting the

purchase of new motor vehicles with specified emission

characteristics—which are otherwise approved for sale by

state and federal regulators—are preempted by the Clean Air

Act, 42 U.S.C. § 7401 et seq.

(i)

FARTIES TO THE PROCEEDINGS

AND RULE 29.6 STATEMENT

Petitioner Engine Manufacturers Association (“EMA”) was

plaintiff and appellant below. Respondents South Coast Air

Quality Management District, its individual Board Members

(William A. Burke, Norma J. Glover, Michael D. Antono-

vich, Hal Bernson, Jane W. Carney, Cynthia P. Coad, Bea-

trice J.S. Lapisto-Kirtley, Ronald O. Loveridge, Jon D.

Mikels, Leonard Paulitz, Cynthia Verdugo-Peralta, and

S. Roy Wilson), and its Executive Officer (Barry R. Waller-

stein) were defendants and appellees below.

Petitioner Western States Petroleum Association

(““WSPA”) intervened below on behalf of plaintiff EMA, and

also joined in EMA’s appeal to the Ninth Circuit. The

Natural Resources Defense Council, Coalition for Clean Air,

Communities for a Better Environment, Inc., Planning &

Conservation League, and Sierra Club intervened on behalf

of defendants.

Pursuant to S. Ct. Rule 29.6, petitioner EMA states that it is

the not-for-profit trade association representing the interests

of the world’s leading manufacturers of internal combustion

engines used in almost all medium-duty and heavy-duty

motor vehicles, other than passenger cars. EMA members

manufacture the medium-duty and heavy-duty compression-

ignition, diesel-fueled engines that are installed in certain

pick-up trucks and sport-utility vehicles, delivery vans,

shuttle vans and cargo vehicles, trucks, tractor-trailers, waste

haulers, street-sweepers and buses, and sold throughout the

United States. EMA has no corporate parents, subsidiaries or

affiliates, and no publicly traded company has a 10% or

greater ownership interest in EMA.

iil

Petitioner WSPA is a trade association organized as a non-

profit corporation under California law. Its members consist

of companies engaged in the exploration, production, trans-

portation, refining and marketing of crude oil and petroleum

products, including diesel fuel. WSPA has no corporate

parents, subsidiaries or affiliates, and no publicly traded

company has a 10% or greater ownership interest in WSPA.

TABLE OF CONTENTS

Page

QUESTION PRESENTED ..0...-ccccccccssescoccscccsccseeseceseee j

PARTIES TO THE PROCEEDINGS AND RULE

29.6 STATEMENT 0.0 -ccccccccccccsecssccsessssssessecssssseeees ii

TABLE OF AUTHORITIES. .......-.-ccccccccccsseccsessesseesees vi

ERAGE TS SC |

I ae 2

CONSTITUTIONAL AND STATUTORY

PROVISIONS INVOLVED .....-ccccccccsccsccsseceeeseeoees 2

LS A EN ee 2

STATEMENT OF THE CASE ..00.-.cccccccssessessesseesveses 5

REASONS FOR GRANTING THE WRIT ........000.-... 10

|. THE NINTH CIRCUIT’S DECISION

CONFLICTS WITH THE DECISIONS OF

THE OTHER FEDERAL CIRCUITS TO

HAVE ADDRESSED THE ISSUE ................ 10

Il. THE NINTH CIRCUIT’S DECISION

CONFLICTS WITH THIS COURT’S

PREEMPTION JURISPRUDENCE............... 18

III. THE QUESTION PRESENTED IS AN

ISSUE OF NATIONAL IMPORTANCE

AND SHOULD BE DECIDED BY THIS

"sR 21

EE es oe 24

TABLE OF CONTENTS—Continued

Page

APPENDICES

APPENDIX A:

Opinion of the Court of Appeals, dated

October 24, 2002 .........ccccccceeceeeeeeeenenernnenes la

APPENDIX B:

Opinion of the District Court, dated August

22, QOON ......cecccescesesessseresstoorcsrssnsnsenensesnnens 3a

APPENDIX C:

Order of the Court of Appeals denying rehear-

ing, dated December 11, 2002...........-+-+++ 28a

APPENDIX D:

Excerpt of Br. Amicus Curiae of the United

States, Central Valley Chrysler-Plymouth,

Inc. v. Michael P. Kenny, No. 02-16395

(Gtr Cir.) .....csccseseseeseeeeesenensnennnnsnennnannnennees 30a

TABLE OF AUTHORITIES

Cases:

Allway Taxi Inc. v. City of New York, 340 F. Supp.

eee

American Airlines, Inc. v. Wolens, 513 U.S. 219

American Auto. Mfrs. Ass'n vy. Cahill, 152 F.3d 196

DIDS. IIIT esstnsiiasriectgrad tinea aiidiataiinaibiaananaateians

Association of Int'l Auto. Mfrs. vy. Commissioner,

Massachusetts Dep't of Envil. Protection, 208

eof en

Buckman Co. v. Plaintiffs’ Legal Comm.,

Be Se Be CE cicenecncesnsencgpscicinntenninnssintennes

Central Valley Chrysler-Plymouth, Inc. v. Michael

P. Kenny, No. 02-16395 (9th Cir.) ........ccccccecceeeeeeeees

City of Chicago v. General Motors Corp.,

467 F.2d 1262 (7th Cir. 1972) ......cccccccesceeceeeeeeeeees

Engine Mfrs. Ass'n v. EPA, 88 F.3d 1075 (D.C.

Morales v. Trans World Airlines, Inc., 504 U.S.

SE ITTTTITEI isinscichtpesscheepeiiaaaaetaptinctaiatettettgntaaataemeanmuanntnan

Motor & Equipment Mfrs. Ass'n v. EPA,

627 F.2d 1095 (D.C. Cir. 1979)........ccccccccseserseerenees

Motor Vehicle Mfrs. Ass'n v. New York State Dep't

of Envtl. Conservation, 79 F.3d 1298 (2d Cir.

Motor Vehicle Mfrs. Ass'n v. New York State Dep't

of Envtl. Conservation, 17 F.3d 521 (2d Cir.

(vi)

Page

vil

TABLE OF AUTHORITIES—Continued

Page

Cases:

Motor Vehicle Mfrs. Ass'n v. New York State Dept

of Envtl. Conservation, 810 F. Supp. 1331

(N.D.N.Y. 1993), aff'd in part, rev'd in part, 17

F.3d 521 (2d Cir. 1994) .......cccccsesereerserersnensnnensnenerenes 5

Norfolk S. Ry. Co. v. Shanklin, 529 U.S. 344

(2000) ......:serecsscessosssssreesensnsensnsensnsenenensenensenensnonsnseness 21

Washington v. General Motors Corp., 406 U.S. 109

(1972) ..ccessessesessessssssnssnsnssssnsensnnsnsensnssnsnnenennsnsnnssenssees 3, 18

Constitution:

U.S. Const., art. VI, ch. 2.....ccccccccceseseeenesrenercnnsnnnennenens 2

Statutes:

2B U.S.C. § 1254(1) ...sececcceseresssesrsnensnsnensnsnenansnenenensenens 2

42 U.S.C. § 7401 Cf SOG ...-.-cecsereererenenenenenenanerennennnnnnens 9

42 U.S.C. § T408(a) .....ccececesseesseneesnencnsnensnensnanenanerennnnes 5

42 U.S.C. § 7507 .....ccscccseesssenssssnensnsnsnssnsnananananenanensnsnnes 6, 11

M2 U.S.C. § TS2D ..ereccscscsresesessssensnsnsensrsnsnenenananenansnsnenens 22

42 U.S.C. § 75438) ...ecccecereeosserseensesenensnenanananennnnanenenes passim

42 U.S.C. § 7543(D)....cecccecereresesesrsnsnsrsnsnsnsnnnnensnnnansnenes 6, 10, 22

42 U.S.C. § T543(D) 1) ..-c-scsecererseenseresrsenenenananennanenes yooes 6

Legislation:

H.R. Rep. No. 90-728 (1967), reprinted in 1967

U.S.C.C.A.N. 1938 ...cccccsccssccssseeseesesesenenennsnennnensnnnnnes 22

Rules:

S. Ct. Rule 10(a) ......-..-cscccsceseeseeeessnensennenensenannennannenneny 3

S. Ct. Rule 10(C) ......-cccceccceeceersseeesernserenennsnnnnannnsnnnnennns “3,4

IN THE

Supreme Court of the Anited States

ENGINE MANUFACTURERS ASSOCIATION AND

WESTERN STATES PETROLEUM ASSOCIATION,

Petitioners,

SOUTH COAST AIR QUALITY MANAGEMENT DISTRICT, ef al.,

Respondents.

Petition for a Writ of Certiorari to the

United States Court of Appeals

for the Ninth Circuit

PETITION FOR A WRIT OF CERTIORARI

The Engine Manufacturers Association (“EMA”) and the

Western States Petroleum Association (“WSPA”) respect-

fully petition for a writ of certiorari to review the judgment

of the United States Court of Appeals for the Ninth Circuit in

this case.

OPINIONS BELOW

The opinion of the Ninth Circuit affirming the District

Court’s judgment is reported at 309 F.3d 550 and reprinted in

the appendix hereto (“App.”) at la. The opinion of the

District Court granting judgment for defendants is reported at

158 F.Supp.2d 1107 and is reprinted at App. 3a-27a.

JURISDICTION

The judgment of the Court of Appeals was entered on

October 24, 2002. A timely petition for rehearing was denied

on December 11. 2002. App. 29a. The jurisdiction of this

Court rests on 28 U.S.C. § 1254(1).

CONSTITUTIONAL AND © f ATUTORY

PROVISIONS INVOLY &D

The Supremacy Clause of the United States Constitution

provides in pertinent part:

This Constitution, and the Laws of the United States

which shall be made in Pursuance thereof * * * shall be

the supreme Law of the Land; and the Judges in every

State shall be bound thereby, any Thing in the Constitu-

tion or Laws of any State to the Contrary notwithstand-

ing. (U.S. Const., art. VI, cl. 2.]

Section 209(a) of the federal Clean Air Act, 42 USC.

§ 7543(a), an express preemption provision, provides in

pertinent part:

No State or any political subdivision thereof shall adopt

or attempt to enforce any standard relating to the control

of emissions from new motor vehicles or new motor ve-

hicle engines subject to this part. No State shall require

certification, inspection, or any other approval relating to

the control of emissions from any new motor vehicle or

new motor vehicle engine as condition precedent to the

initial retail sale, titling (if any), or registration of such

motor vehicle, motor vehicle engine, or equipment.

INTRODUCTION

This case presents the question whether a local air quality

district’s “Fleet Rules,” which prohibit operators of a fleet of

fifteen or more vehicles from purchasing new diesel-fueled

vehicles, constitute “standards relating to the control of

emissions,” and are thus preempted under the Clean Air Act.

It is also one of the unusual cases in which all the customary

criteria for certiorari are readily met.

First, the Ninth Circuit’s decision conflicts with the deci-

sions of two other federal circuit courts that have considered

the same issue. S. Ct. Rule 10(a). Both the First and Second

Circuits have squarely held that regulations requiring that a

percentage of vehicles sold be zero-emission vehicles estab-

lished emissions “standards” and thus were preempted by the

Clean Air Act. Association of Int'l Auto. Mfrs. v. Commis-

sioner, Massachusetts Dep't of Envtl. Protection, 208 F.2d 1,

7 (Ist Cir. 2000); American Auto. Mfrs. Ass'n v. Cahill, 152

F.3d 196, 200 (2d Cir. 1998). The Ninth Circuit, on the other

hand, held that the Fleet Rules did not impose emissions

“standards,” and thus were not preempted, because the Fleet

Rules spoke in terms of “purchases,” not “sales.” That

semantic distinction does not and cannot explain away the

stark conflict that now exists between the First and Second

Circuits and the Ninth Circuit.

Second, the Court of Appeals’s decision flatly conflicts

with the decisions of this Court. S. Ct. Rule 10(c). This

Court observed over three decades ago that Congress in the

Clean Air Act “largely preempted the field with regard to

‘emissions from new motor vehicles.’” Washington v.

General Motors Corp., 406 U.S. 109, 114 (1972). And as

this Court has recognized in other contexts, the language

chosen by Congress in preempting standards “relating to the

control of emissions from new motor vehicles” is deliberately

broad. Morales v. Trans World Airlines, Inc., 504 U.S. 374,

383-384 (1992) (“related to” preemption is “broad” and

“expansive”). Preemption under a “related to” clause typi-

cally covers all state laws having “reference to” or “connec-

tion with” the preempted subject matter. American Airlines,

Inc. v. Wolens, 513 U.S. 219, 223 (1995).

This Court’s precedents concerning the preemptive force of

the Clean Air Act and the expansive nature of its “relating

to” language compel the conclusion that the Act’s preemp-

tion provisions encompass and prohibit the Fleet Rules here

at issue. The Fleet Rules refer to and adopt a subset of

standards and other preconditions in an effort to control the

level of emissions from new motor vehicles. Indeed, obtain-

ing reductions from new vehicle emissions is the very

purpose of the Fleet Rules. The Fleet Rules seek to do so by

mandating the purchase of new vehicles meeting the Dis-

trict’s designated subset of “standards,” and by prohibiting

the purchase of diesel-fueled vehicles that can be purchased

throughout California and the nation as a whole. Thus,

pursuant to this Court’s prior decisions, the Fleet Rules

clearly “relate to” the control of emissions from new motor

vehicles, and so are expressly preempted under the Clean Air

Act.

Third, the conflict in this case concerns a matter of overrid-

ing national importance. S. Ct. Rule 10(c). Congress

included an express preemption provision in the Clean Air

Act to ensure uniformity in regulating new motor vehicle

emissions. But the Ninth Circuit’s decision allows local

governments to impose varying and conflicting emissions

standards on the purchase of new vehicles, balkanizing

emissions standards across the country, undermining the

regulatory authority of the U.S. Environmental Protection

Agency (“EPA”), and thus negating plainly stated congres-

sional intent. The court’s decision should not be allowed to

stand.

STATEMENT OF THE CASE

A. The Clean Air Act.

The Clean Air Act, 42 U.S.C §§ 7401-7671, “is one of the

most comprehensive pieces of legislation in our nation’s

history.” Motor Vehicle Mfrs. Ass'n v. New York State Dep't

of Envtl. Conservation (“MVMA”), 17 F.3d 521, 524 (2d Cir.

1994). Title I of the Clean Air Act directs the U.S. Environ-

mental Protection Agency (“EPA”) to establish national

ambient air quality standards (“NAAQS”) for pollutants that

cause or contribute to air pollution. 42 U.S.C. § 7408(a). To

achieve and maintain those NAAQS, each state is required to

submii a state implementation plan (“SIP”) to EPA for

approval. The SIP details the emission control regulations

applicable to stationary sources within its jurisdiction that the

state will utilize to ensure compliance with the NAAQS.

However, in their attempts to attain the NAAQS deter-

mined by EPA, states may not promulgate standards or other

pre-approval requirements “relating to the control of emis-

sions from new motor vehicles.” 42 U.S.C. § 7543. As the

District Court noted in this case,

Section 209(a) [of the Clean Air Act] expressly pre-

empts all state regulation of motor vehicle emissions.

Congress preempted the field of vehicle emissions for

two reasons: “to ensure uniformity throughout the na-

tion, and to avoid the undue burden on motor vehicle

manufacturers which would result from different stan-

dards.” [App. 7a (quoting Motor Vehicle Mfrs. Ass'n.

v. New York State Dep't of Envtl. Conservation, 810 F.

Supp. 1331, 1337 (N.D.N.Y. 1993), aff'd in part, rev'd

in part, 17 F.3d 521 (2d Cir. 1994))].

Title II of the Clean Air Act reflects Congress’s “endeavor

to resolve the problems caused by moveable sources or

vehicle emissions,” as distinguished from stationary sources

of air pollution such as factories and power plants. App. | la.

Section 202 of the Clean Air Act, 42 U.S.C. § 7543(a),

expressly authorizes EPA to promulgate emission standards

for new motor vehicles sold in the United States. Further,

“fujnder Section 209 of the Clean Air Act, exclusive control

over ‘standards relating to the control of emissions from new

motor vehicles’ is vested in the federal government, and the

states are preempted from regulating in the area.” Cahill,

152 F.3d at 198.

“In contrast to federally encouraged state control over

stationary sources, regulation of motor vehicle emissions had

been a principally federal project.” Engine Mfrs. Ass'n v.

EPA, 88 F.3d 1075, 1079 (D.C. Cir. 1996). Thus, the “cor-

nerstone of Title II is Congress’ continued express preemp-

tion of state regulation of automobile emissions.” M VMA Gs,

F.3d at 526. Only the State of California, due to its unique

air quality problems, received a statutory exemption from the

Clean Air Act’s broad federal preemption, which permitted

that State and that State alone to adopt its own new motor

vehicle emission regulations. 42 U.S.C. § 7543(b)(1). Even

so, California may adopt and enforce its own emission

standards only after applying to and receiving a preeraption

waiver from EPA. /d. § 7543(b).

Other states may promulgate regulations requiring new

vehicles sold in their states to be in compliance with Califor-

nia’s emission standards, thereby “piggy-backing” onto

California’s preemption exemption. However, this opt-in

provision, set forth in section 177 of the Clean Air Act, 42

U.S.C. § 7507, “is carefully drafted to avoid placing ‘an

undue burden on the automobile manufacturing industry.’ ”

App. 12a (quoting MVMA, 17 F.3d at 527). Specifically, an

opt-in state must adopt standards “identical” to California's.

B. California’s Regulations

Pursuant to its authority to adopt its own new motor vehi-

cle emission regulations, California, acting through its Air

Resources Board (“CARB”), has enacted two stringent

emission control programs for new motor vehicles: one for

passenger cars and medium-duty vehicles, including certain

diesel-fueled vehicles (the “LEV Program”), and one for

heavy-duty urban transit buses (the “Urban Bus Program”).

In adopting the LEV Program, “CARB established the

most stringent exhaust regulations ever for light and medium

duty vehicles.” App. 13a. The regulations establish four

tiers of exhaust emission standards for increasingly stringent

categories of low-emission vehicles: (1) transitional low-

emission vehicles (“TLEVs’) (2} low-emission vehicles

(“LEVs”); (3) ultra-low-emission vehicles (“ULEVs”); and

(4) zero-emission vehicles (“ZEVs”). For each category of

vehicles, a set of stringent emission standards for carbon

monoxide, oxides of nitrogen and formaldehyde applies.

“The LEV Program achieves emission reductions by requir-

ing manufacturers to sell progressively cleaner mixes of

vehicles over time. The average emissions from the mix of

these categories of vehicles produced by a manufacturer must

meet an [increasingly lower] overall ‘fleet average’ [emis-

sion] requirement.” App. 14a.

CARB’s Urban Bus Program: (i) requires reductions in

particulate matter and oxides of nitrogen fleet emissions by

urban transit bus operators; and (ii) establishes stringent

exhaust emission standards applicable-to new urban bus

engines. To implement the CARB Urban Bus Program,

urban transit bus fleet operators are required to choose

between two different compliance paths: (i) a diesel path, or

(ii) an alternative fuel (i.e., natural gas) path.

Accordingly, under the CARB Urban Bus Program, as

under the LEV Program, new CARB-certified diesel-fueled

vehicles may continue to be bought and sold throughout

California. The Fleet Rules, by contrast, prohibit fleet

operators from purchasing CARB-certified diesel-fueled

motor vehicles.

C. -The SCAQMD Fleet Rules.

The Fleet Rules at issue in this case were promulgated in

2000 by the South Coast Air Quality Management District

(the “SCAQMD” or “District”), a political subdivision of the

State of California encompassing the greater Los Angeles

metropolitan area. The Fleet Rules app!y to various catego-

ries of operators of public and private fleets of motor vehi-

cles, including transit buses, airport shuttles, limousines,

taxis, street-sweepers, waste haulers, and other heavy-duty

trucks. App. 15a-19a.

As to each category, the Fleet Rules prescribe that when

any covered fleet operator within the District purchases or

replaces its vehicles it must, in the words of the District

Court, “acquire only those specific motor vehicles that the

SCAQMD has designated as meeting its standards and

requirements.” App. 16a (emphasis added). Specifically, the

Rules require fleet operators to procure only the types of low-

emission gasoline vehicles (LEVs or ULEVs) or alternative-

mel vehicles designated by the SCAQMD, which constitute

just a limited “subset” of the types of vehicles certified by

CARB as meeting the State’s new motor vehicle emission

standards. The Fleet Rules also expressly prohibit the pur-

chase of new vehicles equipped with CARB-certified diesel-

fueled engines. !

' For example, Fleet Rules 1191 and 1194 require fleet operators

of passenger cars, light-duty trucks, medium-duty vehicles, airport

shuttles, limousines and taxis to acquire only LEVs, ULEVs or

alternative-fueled vehicles when procuring or leasing those types

of vehicles in the District. Fleet Rule 1192 requires public transit

bus fleet operators to acquire only alternative-fuel heavy-duty

vehicles. Diesel-fueled transit buses, which are allowed under the

CARB Urban Bus Program, are prohibited. Fleet Rules 1193,

1186.1 and 1196 apply to fleets of garbage trucks, street-sweepers

and other heavy-duty trucks, and mandate the purchase or ‘easing

of only alternative-fuel vehicles. The purchase of CARB-certified

D. Proceedings Below.

EMA, later joined by the Western States Petroleum Asso-

ciation, brought suit in the District Court to enjoin the Fleet

Rules, contending that the rules were preempted by the

federal Clean Air Act, 42 U.S.C. § 7401 ef seg. Section

209(a) of the Clean Air Act prohibits States or their political

subdivisions from “adopt[ing] or attempt{ing]} to enforce any

standard relating to the control of emissions from new motor

vehicles or new motor vehicle engines subject to this part.”

42 U.S.C. §7543(a). The Clean Air Act’s preemption

provision also provides that “{njo State shall require

certification, inspection, or any other approval relating to the

control of emissions from any new motor vehicle or new

motor vehicle engine as condition precedent to the initial

retail sale, titling (if any), or registration of such motor

vehicle, motor vehicle engine, or equipment.” /d. (Emphasis

added.)

The District Court granted summary judgment to defen-

dants. App. 27a. In the District Court’s view, the Fleet

Rules did not implicate the Clean Air Act’s preemption

provisions because they regulate only “the purchasing and

leasing, not the sale, of vehicles by fleet operators.” App.

21a. The court further held that “[t}he Fleet Rules do not set

a ‘standard relating to the control of emissions.’ Rather than

imposing any numerical control on new vehicles, the rules

regulate the purchase of previously certified vehicles.” /d.

The District Court acknowledged the flatly contrary holdings

of the Firs’ and Second Circuits, but distinguished each of

those decisions on the grounds that they “hold that an attempt

to limit the sale of vehicles is preempted.” /d. (emphasis in

original). Thus, the linchpin of the District Court’s decision

was its reasoning that the Clean Air Act’s broad preemption

of state and local emission regulations applies only to regula-

diesel-fueled vehicles—tawful for purchase elsewhere in the State

—is expressly prohibited. See App. |Sa-19a.

tions applicable to new motor vehicle sales, and not to

identical regulations governing new motor vehicle purchases.

EMA and WSPA appealed to the Ninth Circuit. The Court

of Appeals adopted the District Court’s decision in whole.

Specifically, the Ninth Circuit issued a published opinion

adopting as its own the “well-reasoned opinion” of the

District Court. App. 2a. The Court of Appeals subsequently

denied EMA’s request for rehearing on December 11, 2002.

App. 29a.

REASONS FOR GRANTING THE WRIT

I. THE NINTH CIRCUIT’S DECISION

CONFLICTS WITH THE DECISIONS OF THE

OTHER FEDERAL CIRCUITS TO HAVE

ADDRESSED THE ISSUE.

The Ninth Circuit’s decision directly conflicts with the

decisions of the First and Second Circuits on the scope and

effect of the Clean Air Act’s broad preemption provisions.

Those decisions both found that regulations . «h “no purpose

other than to effect a general reduction in emissions”—like

the Fleet Rules here—are preempted by the Act.

In American Auto. Mfrs. Ass'n v. Cahill, 152 F.3d 196, the

Second Circuit considered whether New York regulations

requiring a percentage of all new vehicles sold in model

years 1998-2003 to be zero-emission vehicles (“ZEVs”) were

preempted by the Clean Air Act. Section 209(a) of the Clean

Air Act prohibits any state from “adopt{ing] or attempt[ing]

to enforce any standard relating to the control of emissions

from new motor vehicles.” 42 U.S.C. § 7543(a). As ex-

plained above (at 6), the statute provides an exception,

allowing California to adopt or enforce its own new-vehicle

emissions standards, as long as California first obtains a

waiver from the Environmental Protection Agency. See 42

U.S.C. § 7543(b). The statute also allows any other state to

“opt in” to the California regulations if the state’s standards

“are identical to the California standards for which a waiver

has been granted for such model year” and are adopted “at

least two years before commencement of such model year.”

Id. § 7507.

In the early 1990s, California adopted, and obtained a

waiver for, its LEV Program, as described above. In addition

to establishing progressively lower “fleet average” emissions

standards for new vehicle manufacturers, the LEV Program

also required that two percent of all new vehicles certified for

sale in California for model years 1998-2000, five percent for

model years 2001-2002, and ten percent for model year 2003,

be ZEVs. New York adopted California’s LEV program for

light-duty vehicles pursuant to the Clean Air Act’s “opt-in”

provision.

California subsequently abandoned the ZEV sales require-

ment for model years 1998-2002, replacing it with individual

Memoranda of Agreement (“MOAs”) with the seven largest

automobile manufacturers, requiring specific numbers of

ZEVs to be sold during calendar years 1998-2000. New

York, however, did not amend its regulations in response to

the California changes, and automobile manufacturers

challenged New York’s ZEV sales requirement for model

years 1998-2002 as preempted under Section 209 of the

Clean Air Act.

Reviewing a district court decision which had found no

preemption of the New York regulations, the Second Circuit

considered whether the State’s ZEV sales requirement was a

“standard relating to the control of emissions” and therefore

within Section 209’s preemptive scope, or whether it was

only an enforcement procedure and therefore not preempted.

Noting that “standards relating to the control of emissions”

are “regulatory measures intended to lower the level of auto

emissions,” the court found New York’s ZEV requirement to

constitute such a standard:

To be sure, the ZEV sales requirement does not impose

precise overall quantitative limits on levels of emis-

sions, as do the classification system and fleet averages.

It mandates only that a specified percentage of the [ve-

hicles} sold by a manufacturer in any model year be

ZEVs. Nevertheless, the ZEV sales requirement must

be considered a standard “relating to the control of

emissions.” ZEV, after all, stands for “zero-emission

vehicle,” and a requirement that a particular percentage

of vehicle sales be ZEVs has no purpose other than to

effect a general reduction in emissions * * *. The ZEV

sales requirement is, therefore, in the nature of a com-

mand having a direct effect on the level of emissions.

[152 F.3d at 200 (emphases added). }

Finding that the ZEV sales requirement was a “standard”

within the meaning of Section 209, the court concluded that

the New York regulations were preempted by the Act. See

ibid? See also MVMA, 17 F.3d at 536 (Clean Air Act’s

preemption provisions prohibit limitations on the types of

certified new motor vehicles that may be bought and sold in

interstate commerce).

The First Circuit reached a similar conclusion in Associa-

tion of Int'l Auto. Mfrs. v. Commissioner, Mass. Dep't of

Envtl. Prot., 208 F.3d 1, which considered Massachusetts’s

adoption of California’s LEV program. Unlike New York,

Massachusetts amended its regulations in response to the

California MOAs; Massachusetts, however, did not adopt the

MOAs in their entirety. The California MOAs provided that

the manufacturers would develop ZEV technology and

introduce a limited number of ZEVs into the California

market during the years 1998-2002, and California, in

2 The court also concluded that the New York ZEV program did

not identically copy the California program as amended, and thus

was not alternatively permitted under Section 177 of the Act. /d.

at 201.

exchange, agreed to provide infrastructural support for ZEV

implementation. | The Massachusetts regulations were

amended to reflect the automakers’ obligations under the

MOAs, but the reciprocal obligations undertaken by Califor-

nia were not also included. Automobile manufacturers

challenged those regulations, arguing that because the

Massachusetts program did not copy the California program

in its entirety, the regulations were preempted by the Clean

Air Act.

Reviewing the district court’s conclusion that ZEV man-

dates were “standards relating to the control of emissions,”

the First Circuit agreed with the Second Circuit that “a

requirement that a particular percentage of vehicle sales be

ZEVs has no purpose other than to effect a general reduction

in emissions.” /d. at 7. The court continued:

In contrast to [nonpreempted] “enforcement mecha-

nisms” such as testing and reporting requirements, we

think that numerical production requirements such as

those in the Massachusetts ZEV mandates must be con-

sidered “standards relating to the control of emissions.”

Rather than simply monitoring or enforcing compliance

with some distinct numerical emissions standard, the

very purpose and effect of the ZEV mandate is to effect

a quantitative reduction in emissions. [Id. at 6-7 (cita-

tions omitted and emphases added)].

Finding that the ZEV mandates are standards as that term is

used in Section 209 of the Clean Air Act, the court concluded

that Massachusetts’s regulations were preempied by that

section of the Act. See id. at 7. As a result, the court invali-

dated Massachusetts’s ZEV program. /d.

As both Cahill and Commissioner emphasize, Section 209

expressly covers “standards relating to the control of emis-

sions”; regulations are considered to be such standards where

they have “no purpose other than to effect a general reduction

in emissions.” Cahill, 152 F.3d at 200; see also Commis-

sioner, 208 F.3d at 6. That is exactly the type of regulation

that the South Coast Air Quality Management District has

instituted here.

The Fleet Rules mandate that when certain local operators

of fleets purchase or replace their fleet vehicles, they must

acquire only those specific motor vehicles that the SCAQMD

has designated as meeting “its standards and requirements.”

The Ninth Circuit recognized as much. App. 16a, 2a. Such

regulations, which collectively require fleet operators to

purchase or lease only low-emission or alternative-fuel

vehicles, have “no purpose other than to effect a general

reduction in emissions.” Cahill, 152 F.3d at 200; see also

Commissioner, 208 F.3d at 6.

Indeed, by requiring fleet operators—a group which by its

nature controls large numbers of pollution-emitting vehicles

in a given area—to purchase or lease vehicles with lower

emissions, the SCAQMD imposed rules that would lead to a

quantitative reduction in emissions. Even the District Court

explicitly recognized that the SCAQMD adopted the Fleet

Rules “in an effort to reduce public exposure to motor

vehicle pollution.” App. 15a. Thus, because the Fleet Rules

are “regulatory measures intended to lower the level of auto

emissions,” Cahill, 152 F.3d at 200, they are “standards

relating to the control of emissions” preempted by Section

209 of the Clean Air Act.’

3 Furthermore, the extent to which the Fleet Rules actually

serve to reduce the total level of emissions within the District is

irrelevant. As the First Circuit observed in Commissioner,

“Massachusetts’ original contention that the ZEV mandates should

not be considered standards simply because they would have a

very small impact on overall emissions levels is unpersua-

sive—whether a regulation effects a small or great impact on

overall emissions is a question of degree, not one of kind.” 208

F.3d at 6.

But the Ninth Circuit concluded that “the Fleet Rules do

not set a ‘standard relating to the control of emissions.’”

App. 21a, 2a. In support of this conclusion, the court distin-

guished Cahill and Commissioner by stating that “(t}hese

cases hold that an attempt to limit the sale of vehicles is

preempted.* * * It does not follow, however, that a rule

regulating the purchase of vehicles is such a standard.” App.

23a, 2a (emphasis in original).

Nowhere, however, does the Clean Air Act limit the “stan-

dards relating to the control of emissions” to rules regulating

the sale of vehicles. Rather, the plain language of the Act

makes clear that “standards” are found to exist where emis-

sions levels are regulated, regardless of the means used. See

42 U.S.C. § 7543(a) (prohibiting states from imposing “any

standard relating to the control of emissions”) (emphasis

added); see also Commissioner, 208 F.3d at 6; Cahill, 152

F.3d at 200.4

In addition, the Ninth Circuit’s purely semantic distinction

does not bear up under even slight scrutiny. It is impossible

to imagine a situation in which a regulatory limit on pur-

_ chases does not necessarily affect sales—especially here,

where the customer base, fleet operators, is distinct. When

all fleet operators in the South Coast Air Basin are required

4 One might argue that the Ninth Circuit read the Clean Air

Act’s ban on restrictions as limited to “sales,” rather than “pur-

chases,” from the second sentence in Section 209(a) of the Clean

Air Act, which provides that no state shall put measures into place

to control emissions as a “condition precedent to the initial retail

sale, titling (if any), or registration” of a motor vehicle. 42 U.S.C.

§ 7543(a). However, this provision (which the court did not

discuss at all), must be read in context with the broad prohibition

in the first sentence of Section 209(a). /d. Thus, the prohibited

standards include duties the state may place on the manufacturer

(such as requirements before a sale), or on the consumer (such as

requirements before titling and registration, or in this instance,

limits on purchases).

to purchase only certain low-emissions or alternative-fuel

vehicles for public transit, street sweeping, waste collection,

and other public purposes, sales of such vehicles inevitably

will be affected. The Ninth Circuit’s attempt to characterize

the Fleet Rules as only affecting vehicle purchases, and not

sales, is therefore untenable; the Fleet Rules, like the New

York and Massachusetts ZEV regulations, impact the trade of

vehicles in their respective regions and in turn are standards

“having a direct effect on the level of emissions,” as contem-

plated by the Act.

The Court of Appeals also tried to distinguish the Fleet

Rules from the ZEV regulations by noting that the Fleet

Rules “regulate the purchase of previously-certified vehi-

cles,” rather than “imposing any numerical control on new

vehicles.” App. 21a, 2a. But, again, there is no support for

the contention that “standards” as used in the Act are only

those regulations that impose some type of a numerical

requirement on manufacturers.

Moreover, as noted above, the Fleet Rules do impose nu-

merical requirements on manufacturers, even if they do so

indirectly. The truth of this observation is strongly supported

by EPA’s opinion letter discussed in Commissioner, in which

the EPA provided its understanding of the term “standard”

under the Act:

Setting the link between the emission limit and the ap-

plicability of the limit to a particular number of vehicles

is an inherent part of the standard setting process. * * *

If a production requirement, such as the ZEV mandate,

is not considered part of the standard itself, then the

compliance with a standard * * * would be discon-

nected from the obligation to build cars to meet the

standard. This could lead to emission standards that

have no air quality benefit at all. [208 F.3d at 6 (quot-

ing EPA Opinion Letter at 9).]5

In addition to emphasizing that impact on emissions is the

primary criterion in determining whether a regulation is a

Clean Air Act “standard,” the EPA letter reveals that state

motor vehicle requirements must be read in terms of their

practical application. In this case, the Fleet Rules require

fleet operators to purchase only low-emission or alternative-

fuel vehicles. As a result, manufacturers must provide more

fleet vehicles that are LEVs, ULEVs, or that operate on

alternative fuels. Indeed, if the Fleet Rules’ purchase re-

quirements were not considered part of the “standard,” there

would be a similar compliance “disconnect” here. Thus,

despite the fact that the Fleet Rules do not impose numerical

requirements directly on manufacturers, they nonetheless

impose standards that require ‘nanufacturers to build more

vehicles of certain lower emissions levels or fuel types, and

thus in the EPA’s construction are “standards” under the Act.

In short, both the First and Second Circuits, and the EPA,

have concluded that regulations are Clean Air Act “stan-

dards” when they seek to bring about a general reduction in

5 Before the First Circuit decided Commissioner, it referred

several questions to the Environmental Protection Agency under

the doctrine of primary jurisdiction. See Commissioner, 208 F.3d

at 3-4. The EPA responded in an opinion letter, in which it opined,

as disclosed in the quote above, that the Massachusetts ZEV

mandates are “standards” for purposes of Sections 209 and 177 of

the Clean Air Act. See id. at 6. The First Circuit subsequently

decided, however, that its referral to the EPA was “somewhat

inartful,” because the EPA opinion letter was not final agency

action warranting any particular deference, but rather was an

“advisory opinion only.” /d. at 5-6. As a result, the First Circuit

did not rely on the EPA’s conclusion that the ZEV mandates are

standards as that term is used in Sections 209 and 177 of the Act;

nonetheless, it independently agreed with the EPA on this point.

See id. at 7.

emission levels. The Fleet Rules, just like the ZEV regula-

tions in New York and Massachusetts, were instituted to

reduce emissions levels, and for this reason are identical to

the regulations deemed “standards” by the First and Second

Circuits. Yet, the Ninth Circuit failed to find federal preemp-

tion of these “standards.” Thus, the Ninth Circuit’s ruling

creates a circuit split—and an especially intolerable one,

because it introduces disparity in the operation of a federal

law specifically armed with a preemption clause intended to

promote national uniformity.

Il. THE NINTH CIRCUIT’S DECISION

CONFLICTS WITH THIS COURT’S

PREEMPTION JURISPRUDENCE.

The scope of the Clean Air Act’s express preemption of

state and local regulation of emissions from new motor

vehicles is expansive. This Court has long recognized that

Section 209(a) of the Act comprehensively preempts state

and local regulation of new motor vehicle emissions. See

Washington v. General Motors Corp., 406 U.S. 109, 114

(1972) (“Congress has largely pre-empted the field with

regard to ‘emissions from new motor vehicles’ ”’).°

6 See also Commissioner, 208 F.3d at 3 (Congress “expressly

preempted ail state regulation of new motor vehicle emissions”)

(emphasis added); Motor Vehicle Mfrs. Ass'n v. New York State

Dep't of Envtl. Conservation, 79 F.3d 1298, 1302 (2d Cir. 1996)

(“In general, state regulation of automotive tailpipe emissions is

preempted by the federal Clean Air Act”); Motor & Equipment

Mfrs. Ass'n v. EPA, 627 F.2d 1095, 1109 (D.C. Cir. 1979) (“Con-

gress in 1967 expressed its intent to occupy the regulatory role

over emissions control to the exclusion of all the states, all, that is,

except California”), cert. denied, 446 U.S. 952 (1980); City of

Chicago v. General Motors Corp., 467 F.2d 1262, 1264 (7th Cir.

1972) (section 209(a) preempts “the entire field of standards for

emissions from new motor vehicles”).

The consistency of the holdings regarding the breadth of

the Clean Air Act’s express preemption provisions is not

surprising. Section 209(a) preempts state and local govern-

ments both from adopting or enforcing “any standard relating

to the control of emissions from new motor vehicles” and

from requiring “certification, inspection, or any other ap-

proval relating to the control of emissions from any new

motor vehicle * * * as condition precedent to the initial retail

sale, titling (if any), or registration of such motor vehicle.”

42 U.S.C. § 7543(a). Taken together, these dual preemptions

encompass virtually all state or local regulations directed at

controlling emissions from new motor vehicles.

The Ninth Circuit, however, rejected this well-established

jurisprudence relating to the Clean Air Act, and held that the

SCAQMD Fleet Rules fall within neither of the two com-

plementary preemption provisions of Section 209(a). That

holding should not stand. The Fleet Rules are a “standard

relating to the control of emissions from new motor vehi-

cles,” as both the First and Second Circuit have held. In

addition, in certain situations the Fleet Rules require fleet

operators to obtain approval certificates from the District as a

condition precedent to the purchase of new vehicles. That

too is expressly preempted by Section 209(a). Thus, the

Ninth Circuit’s ruling is in direct conflict with controlling

jurisprudence relating to Section 209¢a).

The Ninth Circuit’s decision also flatly conflicts with this

Court’s numerous holdings recognizing the breadth of the

phrase “relating to” when used in preemption statutes. See,

e.g., Morales v. Trans World Airlines, Inc., 504 U.S. 374,

378 (1992) (the phrase “related to” used in a preemption

statute “express[es] a broad preemptive purpose”). Instead,

and contrary to this Court’s precedent, the lower court

strained to narrow the scope of the Clean Air Act’s express

preemption provisions and improperly looked beyond its

plain meaning in a freewheeling reconstruction of legislative

history. See Geier v. American Honda Motor Co., 529 USS.

861, 906 (2000) (“a freewheeling judicial inquiry into

whether [state law] is in tension with federal objectives

would undercut the principle that it is Congress [and federal

agencies] rather than the courts that preempt state law.”)

(Brackets in original). The result of the Ninth Circuit's

disregard of the express terms of the Clean Air Act is a

wholesale evisceration of preemption and Congressional

purpose, all contrary to this Court’s prior decisions.’

The Fleet Rules clearly “relate to” the “control of emis-

sions from new motor vehicles.” Indeed, control of emis-

sions is the entire purpose and effect of the Fleet Rules. App.

15a (noting that Fleet Rules are “an effort to reduce public

exposure to motor vehicle pollution”). There can be no

doubt that the Fleet Rules are “in connection with” the

control of emissions, or that their “purpose and effect * * * is

to effect a quantitative reduction in emissions.” Commis-

sioner, 208 F.3d at 7. Moreover, it can hardly be disputed

that the Fleet Rules make “reference to” the control of

emissions given that they incorporate a subset of vehicle

standards approved by CARB for purposes of emissions

control. The fact that the Fleet Rules expressly limit the

purchase of vehicles to those that are certified toa subset of

the applicable California numerical emission limits, while

prohibiting the purchase of vehicles that comply with other

valid California and federal emission limits, necessarily

7 The court’s “freewheeling” approach also yielded a result in

direct conflict with the recently expressed view of the United

States on the broad scope of preemption “relating to” new motor

vehicles. See Br. Amicus Curiae of the United States, Central

Valley Chrysler-Plymouth, Inc. v. Michael P. Kenny, No. 02-

16395 (9th Cir.) (arguing that “under the ‘connection with or

reference to’ standard embraced by the Supreme Court, the

California emission control regulations at issue [in that case] are

clearly preempted”). An excerpt of the United States’ submission

in the Central Valley case is appended hereto. App. 30a-42a.

means that the Rules are preempted “standards” relating to

control of vehicle emissions. The Ninth Circuit’s ruling to

the contrary thus clearly warrants review.

Ill. . THE QUESTION PRESENTED IS AN ISSUE OF

NATIONAL IMPORTANCE AND SHOULD BE

DECIDED BY THIS COURT.

Preemption is the “cornerstone” of the portions of the

Clean Air Act governing the regulation of new motor vehi-

cles. MVMA, 17 F.3d at 526. The Ninth Circuit’s decision

substantially undermines the Clean Air Act’s preemption

provisions; it thus presents an issue of national importance,

particularly to the United States Government and the EPA.®

If the court’s holding stands, any State or political subdivi-

sion may enact its own unique emission requirements simply

by prescribing that no one subject to its jurisdiction may

purchase or lease a new motor vehicle that is not an alterna-

tive-fuel vehicle, or that no one may purchase or lease a new

motor vehicle that, for example, is not a “low emission

vehicle” by some definition. And there would be no assur-

ance whatsoever that each state and political subdivision

would designate the same “subset” of “approved” new motor

8 See Br. of United States as Amicus Curiae, Motor Vehicle Mfrs

Ass'n v. New York State Dep't of Envtl. Conservation, 79 F.3d

1298 (discussing challenge to California regulations alleged to

violate Clean Air Act’s “third vehicle” prohibition); Br. of United

States as Amicus Curiae, MVMA, 17 F.3d 521 (discussing chal-

lenge under Clean Air Act to State rules regulating tailpipe

emissions); see also Br. of United States as Amicus Curiae,

Norfolk S. Ry. Co. v. Shanklin, 529 U.S. 344 (2000) (noting

“strong interest” of United States in how statute with an express

preemption provision—there, the Federal Railroad Safety Act—is

“interpreted and applied”); Br. of United States as Amicus Curiae,

Buckman Co. v. Plaintiffs’ Legal Comm., 531 U.S. 341 (2001)

(noting “substantial interest” of United States in question whether

federal law preempted state-law tort claims alleging fraud on the

FDA).

vehicles. The result would be that interstate commerce in

motor vehicles would be subjected to the varying require-

ments of the fifty states and their thousands of political

subunits—the very result Congress meant to avoid by

explicitly preempting regulation in this field.

Congress broadly preempted local regulations relating to

the control of emissions from new motor vehicles specifically

“to prevent a chaotic situation from developing in interstate

commerce in new motor vehicles,” H.R. Rep. No. 90-728

(1967), reprinted in 1967 U.S.C.C.A.N. 1938, 1956, and to

avoid “the spectre of an anarchic patchwork of federal and

state regulatory programs, a prospect which threatened to

create nightmares for the manufacturers.” Engine Mfrs.

Ass'n v. EPA, 88 F.3d at 1079. The Fleet Rules bring that

chaos to life, and the Ninth Circuit’s decision upholding the

rules flouts Congress’s express directive against balkaniza-

tion of the nationwide market for new motor vehicles. The

impact of such a fractured market for new motor vehicles in

the United States would be to increase significantly the cost

of manufacturing marketable vehicles and engines.

The Ninth Circuit’s decision not only fractures the nation-

wide market for motor vehicles, it also undermines the ability

of the Federal government to establish, implement and

achieve its emission standards for new motor vehicles. In

preempting states and local governments from regulating

new motor vehicles, Congress also imposed on the Federal

government the obligation to set emission standards for, and

reduce emissions from, new motor vehicles. 42 U.S.C.

§ 7521. The primacy of EPA's nationwide emission reduc-

tion standards was recognized by Congress. Thus, California

may obtain a waiver of federal preemption for its standards

only if, among other things, EPA determines that the Califor-

nia standards are “at least as stringent as” and “at least as

protective of health and welfare as” the comparable Federal

standards. 42 U.S.C. § 7543(b).

However, under the Ninth Circuit’s decisi iti

subdivisions of states are free to mandate the va Ar

subset of the types of new motor vehicles certified by EPA or

California. While the SCAQMD has attempted to pick and

choose its subsets ostensibly to set more stringent emission

standards, there is nothing in the Ninth Circuit’s decision that

would prevent a political subdivision from adopting a local

mandate requiring the purchase of the highest emitting

certified vehicles while prohibiting the purchase of the lowest

emitting vehicles. Such an approach, implicitly condoned by

the Ninth Circuit, would undermine the Federal govern-

ment’s ability to reduce emissions from new motor vehicles

which suggests that the United States Government would

want to be heard on this issue (see su

pra n.8), and wh

further warrants this Court’s review. oe

CONCLUSION

For the foregoing reasons, the petition for a writ of certio-

rari should be granted.

JOHN J. SULLIVAN

GREGORY R. MCCLINTOCK

MAYER, BROWN, ROWE & MAW

1909 K STREET, N.W.

Washington, D.C. 20006

(202) 263-3000

Counsel for Petitioner Western

States Petroleum Association

Respectfully submitted,

PHIL C. NEAL

Counsel of Record

JED R. MANDEL

TIMOTHY A. FRENCH

NEAL, GERBER & EISENBERG

Two North LaSalle Street

Suite 2200

Chicago, Illinois 60602

(312) 269-8000

Counsel for Petitioner Engine

Manufacturers Association

APPENDICES

APPENDIX A

PUBLISHED AT 309 F.3d 550

IN THE UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

No. 01-56688

(D.C. No. CV-00-09065-FMC)

ENGINE MANUFACTURERS ASSOCIATION, ef al.,

Plaintiffs-Appellants,

SOUTH COAST AIR QUALITY MANAGEMENT DISTRICT, ef al.,

Defendants-Appellees.

Filed October 24, 2002

OPINION

Appeal from the United States District Court for the Central

District of California, Florence Marie Cooper, District Judge,

Presiding, D.C. No. CV-00-09065-FMC.

Before GOODWIN, RYMER, and McKEOWN, Circuit

Judges.

ORDER

Engine Manufacturers Association and Western States

Petroleum Association appeal the district court’s judgment

that the fleet rules adopted by the South Coast Air Quality

Management District are not preempted by the Clean Air

Act.

We affirm the decision of the district court for the reasons

stated in its well-reasoned opinion, reported at Engine Mfrs.

Ass'n v. South Coast Air Quality Mgmt. Dist., 158 F.Supp.2d

1107 (C.D. Cal. 2001).!

AFFIRMED.

| We decline to consider Amici’s arguments regarding § 246 of

the Clean Air Act. “Generally, we do not consider on appeal an

issued raised only by amicus.” Swan v. Peterson, 6 F.3d 1373,

1383 (9th Cir. 1993).

APPENDIX B

PUBLISHED AT 158 F.Supp.2d 1107

IN THE UNITED STATES DISTRICT COURT

FOR THE CENTRAL DISTRICT OF CALIFORNIA

No. CV 00-09065-FMC (BQRx)

ENGINE MANUFACTURERS ASSOCIATION, et al.,

Plaintiffs,

SOUTH COAST A!IR QUALITY MANAGEMENT DISTRICT, ef al.,

Defendants.

Filed August 22, 2001

OPINION

ORDER RE CROSS MOTIONS FOR

SUMMARY JUDGMENT

COOPER, District judge.

I. BACKGROUND

A. The Parties

Plaintiff Engine Manufacturers Association (“EMA”) is the

not-for-profit trade association representing the leading

manufacturers of internal combustion engines used in most

all medium-duty and heavy-duty motor vehicles, other than

passenger cars. EMA members manufacture the me-

dium-duty and heavy-duty compression-ignition, die-

sel-fueled engines that are installed in certain pickup trucks

and sports-utility vehicles, delivery vans, shuttle vans, and

cargo vehicles, trucks, tractor-trailers, waste haulers,

street-sweepers and buses, and sold throughout the United

States.

Plaintiff-in-Intervention Western States Petroleum Associa-

tion (“WSPA”) is a trade association organized as a nonprofit

corporation under California law. Its members consist of

companies engaged in the exploration, production, transpor-

tation, refining and marketing of crude oil and petroleum

products, including diesel fuel.

Defendant South Coast Air Quality Management District

(“SCAQMD”) is the air quality management district estab-

lished under the California Health and Safety Code to

develop and implement a strategy for achieving and main-

taining ambient air quality standards within the South Coast

Air Basin. Agents of the SCAMQD, including the

SCAMQD Defendants,' are responsible for administering the

Fleet Rules at issue.

| The “SCAQMD Defendants” consist of thirteen (13) Board

members of the SCAQMD, including the SCAQMD’s Executive

Director.

Defendants-in-Intervention “Environmental Intervenors”

are non-profit organizations? dedicated to the protection of

the environment and public health.

California Attorney General Bill Lockyer submitted an

amicus curiae brief on behalf of the State of California in

support of the SCAQMD’s motion for summary judgment

and in opposition to the crossmotions for summary judgment

filed by EMA and WSPA.

B. The South Coast Air Basin

The South Coast Air Basin (“the Basin”), which includes

Los Angeles, San Bernardino, Riverside, and Orange Coun-

ties, experiences the most serious air quality problems in the

nation, primarily due to motor vehic!e pollution. (Staff

Report (“SR”) 1191-1, p. 7439). It is the only air basin in the

country classified by the United States Environmental

Protection Agency (“E.P.A.”) as an extreme nonattainment

area. See 42 U.S.C. § 7511(a). On-road motor vehicles

contribute more than one-half of the ozone precursors

emitted in the Basin and are a principal source of toxic

pollution. (Administrative Record (“AR”) 57 R-6252).

Emission of particulate matter from diesel vehicles and

equipment is the most significant individual toxic air pollut-

ant in the Basin accounting for fully seventy-one percent

(71%) of the air-borne cancer risk. (AR 57 R-6258). The

California Air Resources Board (“CARB”) has formally

designated particulate emissions from diesel-fueled vehicles

as a Toxic Air Contaminant. Studies reveal that exposure to

diesel exhaust increases the risk of developing lung cancer

anc other non-cancer adverse health effects. (AR 41

“ The non-profit organizations include: Coalition for Clean Air,

Inc.; Natural Resources Defense Council, Inc.; Communities for a

Better Environment, Inc.; Planning and Conservation League; 2nd

Sierra Club.

R-1840). Diesel exhaust has also long been considered a

probable human carcinogen by the National Institute of

Occupational Safety and Health and by the International

Agency for Research on Cancer. (AR 41 R-1841).

Diesel trucks and buses are also significant contributors to

smog and fine particles, two pollutants that have serious

public health impacts. On-road motor vehicles contribute

more than half of all smog-forming hydrocarbons and oxides

of nitrogen in the entire emissions inventory. (SR 1191-1, p.

7439). More than ninety-percent (90%) of the particles

emitted from diesel engines are fine particles. (AR 54

R-5514-5515). Fine particles are particularly hazardous,

because they can bypass respiratory defense mechanisms and

penetrate deeply into the lungs. (AR 20 R 5783). The

presence of high quantities of fine particles in the air has

been shown to lead to higher mortality rates, greater occur-

rences and severity of asthma, cardiovascular disease, and

potentially to a higher incidence of cancer. (AR 39 R-1325).

C. Legislative Background

1. The Clean Air Act

The Clean Air Act, 42 U.S.C. §§ 7401-7671q (“CAA”), “is

one of the most comprehensive pieces of legislation in our

nation’s history.” Motor Vehicle Mfrs. Ass'n v. New York

State Dep't of Envtl. Conservation, 17 F.3d 521, 524 (2d

Cir.1994). The CAA makes “the States and the Federal

Government partners in the struggle against air pollution.”

General Motors Corp. v. U.S., 496 U.S. 530, 532, 110 S. Ct.

2528, 110 L. Ed. 2d 480 (1990). A primary purpose of the

CAA is “to encourage or otherwise promote reasonable

Federal, State, and local governmental actions, consistent

with the provisions of this chapter, for pollution prevention.”

42 U.S.C. § 7401(c). Additionally, Congress envisioned the

CAA as a means of encouraging and assisting “the develop-

ment and operation of regional air pollution prevention and

control programs.” 42 U.S.C. § 7401(b)(4).

The CAA directs the E.P.A. to establish and enforce na-

tional ambient air quality standards (“NAAQS”) for pollut-

ants that “cause or contribute to air pollution which may

reasonably be anticipated to endanger public health or

welfare.” 42 U.S.C. § 7408(a). To achieve and maintain

these NAAQS by regulating sources of air pollution, each

State is required to submit a state implementation plan

(“SIP”) to the EPA for approval. CAA § 110, 42 U.S.C.

§ 7410(a)(1). However, states may not promulgate individ-

ual motor vehicle emission standards to attain the NAAQS

set by the EPA. Section 209(a) expressly preempts all state

regulation of motor vehicle emissions. Congress preempted

the field of vehicle emission regulation for two reasons: “to

ensure uniformity throughout the nation, and to avoid the

undue burden on motor vehicle manufacturers which would

result from different state standards.” Motor Vehicle Mfrs.

Ass'n v. New York State Dep't of Envtl. Conservation, 810

F.Supp. 1331, 1337 (N.D.N.Y.1993), aff'd in part, rev'd in

part, 17 F.3d 521 (2d Cir.1994).

“Both the history and text of the [CAA] show that the

* * * preemption section was made not to hamstring locali-

ties in their fight against air pollution but to prevent the

burden on interstate commerce which would result if, instead

of uniform standards, every state and locality were left free to

impose different standards for exhaust emission control

devices for the manufacture and sale of new cars.” Allway

Taxi Inc. v. City of New York, 340 F.Supp. 1120,1124

(S.D.N.Y.1972).

2. Preemption

The United States Supreme Court has given substantial

weight in the preemption analysis to evidence that Congress

intended to preserve the state regulatory authority, stating

that courts must “give full effect to evidence that Congress

considered, and sought to preserve, the States’ coordinate

regulatory role in our federal scheme.” California v. Fed.

Energy Regulatory Comm'n, 495 U.S. 490, 497, 110 S. Ct..

2024, 109 L. Ed. 2d 474 (1990). Moreover, the Supreme

Court has cautioned that preemption provisions must be

narrowly and strictly construed. See Kelly v. Robinson, 479

U.S. 36, 43, 107 S. Ct. 353, 93 L. Ed. 2d 216 (1986); see also

Charas v. Trans World Airlines, Inc., 160 F.3d 1259, 1265

(9th Cir.1998); Chrysler Corp. v. Tofany, 419 F.2d 499, 511

(2d Cir.1969) (where exercise of local police power serves

the purpose of a federal Act, the preemptive effect of that Act

should be narrowly construed).

The Clean Air Act explicitly protects the authority of states

to regulate air pollution. The first section of the CAA,

entitled “Congressional Findings”, 42 U.S.C. § 7401, makes

clear that the states retain the leading authority in regulating

matters of health and air quality: “air pollution prevention

(that is, the reduction or elimination, through any measures,

of the amount of pollutants produced or created at the source)

and air pollution control at its source is the primary responsi-

bility of States and local governments.” 42 U.S.C.

§ 7401(a)(3). Similarly, 42 U.S.C. § 7407, which focuses on

SIPs, provides: “Each state shall have the primary responsi-

bility for assuring air quality within the entire geographic

area comprising such State by submitting an implementation

plan for such State which will specify the manner in which

national primary and secondary ambient air quality standards

will be achieved and maintained within each air quality

control region in such State.” 42 U.S.C. § 7407(a).

“In preemption analysis, the Supreme Court is highly def-

erential to state law in areas traditionally regulated by the

states.” Exxon Mobil Corp. v. U.S. E.P.A., 217 F.3d 1246,

1255 (9th Cir. 2000). The Court has explained:

[W]e have never assumed lightly that Congress has

derogated State regulation, but instead have addressed

claims of preemption with the starting presumption that

Congress does not intend to supplant state law * * * [I]n

cases like this one, where federal law is said to bar state

action in fields of traditional state regulation * * * we

have worked on the “assumption that the historic police

powers of the States were not to be superseded by the

Federal Act unless that was the clear and manifest pur-

pose of Congress.”

N.Y. State Conference of Blue Cross & Blue Shield Plans v.

Travelers Ins. Co., 514 U.S. 645, 654-55, 115 S. Ct. 1671,

131 L. Ed. 2d 695 (1995) (internal citations omitted). “Air

pollution prevention falls under the broad police powers of

the states, which include the power to protect the health of

citizens in the state. Environmental regulation has tradition-

ally been a matter of state authority.” Exxon Mobil Corp.,

217 F.3d at 1255; see also Massachusetts v. U.S. Dep't of

Transp., 93 F.3d 890, 894 (D.C.Cir.1996).The Supreme

Court has directed that the preemption analysis begin with

the presumption that such local police powers are not pre-

empted: “Throughout our history the several States have

exercised their police powers to protect the health and safety

of their citizens. Because these are ‘primar-

ily, * * * matter[s] of local concern,’ the ‘States traditionally

have had great latitude under their police powers to legislate

as to the protection of the lives, limbs, health, comfort, and

quiet of all persons.”” Medtronic, Inc. v. Lohr, 518 U.S. 470,

475, 116 S. Ct. 2240, 135 L. Ed. 2d 700 (1996) (internal

citations omitted). The CAA “explicitly preserved this

principle: ‘Each state shall have the primary responsibility

for assuring air quality within the entire geographic area

comprising such State.”” Train v. Natural Res. Def. Council,

Inc., 421 U.S. 60, 64, 95 S. Ct. 1470, 43 L. Ed. 2d 731

(1975).

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Furthermore, the Supreme Court has made clear that the

objectives and purpose of a statute, as well as the text, are

critical to the preemption analysis. See Travelers, 514 U.S.

at 654, 115 S. Ct. 1671; Medtronic, 518 U.S. at 486, 116 S.

Ct. 2240. “The overriding purpose of the Clean Air Act is to

force states to do their job in regulating air pollution effec-

tively so as to achieve baseline air quality standards, the

NAAQS. The primary mechanism for achieving the NAAQS

are through the local and state planning process which create

the SIPs.” Exxon Mobil Corp., 217 F.3d at 1255-56. “As

regulating air pollution falls under the historic police powers

of the states, the authority of the states is assumed not to have

been preempted unless it was the clear and manifest purpose

of Congress to do so.” /d. at 1256; see also Rice v. Santa Fe

Elevator Corp., 331 U.S. 218, 230, 67 S. Ct. 1146, 91 L. Ed.

1447 (1947) (“{[W]e start with the assumption that the

historic police powers of the States were not to be superceded

by the Federal Act unless that was clear and manifest purpose

of Congress.”).

3. Legislative History of the Clean Air Act

The original CAA, enacted by Congress in 1955, was

aimed primarily at increasing federal research and assistance

in air pollution prevention. It made no provision for federal

motor vehicle emission standards. After several states

adopted their own motor vehicle emission standards, the

Senate Committee on Public Works decided that national

standards were to be preferred over having each state go its

own way, “which could result in chaos insofar as manufac-

turers, dealers, and users are concerned.” S. Rep. No. 192,

89th Cong., Ist Sess. 5-6 (1965). As a result, Congress

enacted emission standards for new motor vehicle engines.

Despite this enactment, a number of states continued to

develop separate emission , ograms. Congress promptly

amended the CAA in 1967 to impose federal preemption

lla

over motor vehicle emission standards. See Air Quality Act

of 1967, Pub. L. No. 90-148, § 208, 81 Stat. 485. An excep-

tion, however, was made for California because of its

“unique problems” and its “pioneering efforts” to control its

particularly severe air quality problems. /d. at § 208(b); S.

Rep. No. 403, 90th Cong., Ist Sess. (1967). In 1970, the Act

was amended to establish national ambient air quality stan-

dards (“NAAQS”), which required even more stringent

uniform emission standards for new motor vehicles. See

Clean Air Amendments of 1970, Pub. L. No. 91-604, §§ 4, 6,

84 Stat. 1676.

In 1990, the Clean Air Act was amended once again. Title

I of the Act directs the E.P.A. Administrator to develop

NAAQS for pollutants the Administrator determines “cause

or contribute to air pollution which may reasonably be

anticipated to endanger public health or welfare.” 42 U.S.C.

§ 7408(a)(1)(A). The states are vested with the primary

responsibility for attaining and maintaining the NAAQS

through the development and implementation of a state

implementation plan (“SIP”). See CAA § 110, 42 U.S.C.

§ 7410. Each state’s SIP, which is submitted to the E.P.A.,

must explain exactly how the state intends to reduce or

maintain the concentration of pollution in the air to meet the

NAAQS. “The states have broad license to institute their

own programs for the reduction of air pollution. * * *”

Motor Vehicle Mfrs. Ass'n, 17 F.3d at 525.

Title Il of the Act reflects Congress’ endeavor to resolve

the problems caused by moveable sources or vehicle emis-

sions. The emission standards applicable to any given

vehicle depend upon its weight and use classification, and its

model year designation. See CAA §§ 202, 207(c), 42 U.S.C.

§§ 7521, 7541(c). Section 202 authorizes the E.P.A. Admin-

istrator to promulgate emission standards for motor vehicles

sold in the United States. Motor vehicle emission standards

primarily regulate emissions of carbon monoxide (CO),

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hydrocarbons or volatile organic compounds (VOCs) and

nitrogen oxides (NOx).

The “cornerstone of Title II is Congress’ continued express

preemption of state regulation of automobile emissions.”

Motor Vehicle Mfrs. Ass'n, 17 F.3d at 526; see CAA

§ 209(a), 42 U.S.C. § 7543(a); see also Engine Mfrs. Ass ny.

U.S. Envtl. Prot. Agency, 88 F.3d 1075, 1079 (D.C.Cir.1996).

The majority of states have chosen to rely on the federal

emission standards set forth in § 202 of the CAA, 42 U.S.C.

§ 7521. Only California enjoys a statutory exemption

allowing it to promulgate its own emission standards. See

CAA § 209%(b), 42 U.S.C. § 7543(b)(1). California may only

adopt and enforce its own emission standards, however, after

applying to and obtaining the approval of the E.P.A. for a

waiver of preemption. See CAA § 209(b), 42 U.S.C. 7543.

The California Air Resources Board (“CARB”) submits an

application upon determining that its proposed standards

“will be, in the aggregate, at least as protective of public

health and welfare as the applicable Federal standards.” /d.

Were California simply to change its standards, and such

change were found to be within the scope of an existing

waiver, California need not submit a new waiver application.

Id.

Additionally, other states could promulgate regulations

requiring vehicles sold in their state to be in compliance with

California’s emission standards, or, in other words, to

“piggyback” onto California’s preemption exception. This

opt-in authority, set forth in CAA § 177, 42 U.S.C. § 7507, is

carefully drafted to avoid placing “an undue burden on the

automobile manufacturing industry.” Motor Vehicle Mfrs.

Ass'n, 17 F.3d at 527. Specifically: (1) an opt-in state must

adopt standards identical to California’s; (2) California must

receive a waiver from the E.P.A. for the standards; and (3)

both California and the opt-in state must adopt the standards

at least two years before the beginning of the automobile

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— to which they apply. See CAA § 177, 42 U.S.C.

The 1990 Amendments to the CAA added two further

restrictions to § 177. First, Congress added language provid-

ing that § 177 shall not be construed as authorizing an opt-in

state to limit the sale of California-certified vehicles. Sec-

ond, it forbade opt-in states from taking any action that has

the effect of creating a car different from those produced to

meet either federal or California emission standards, a

so-called “third vehicle.”

4. California's Plan

Pursuant to its authority to adopt separate emission control

requirements for new motor vehicle engines, California,

acting through CARB, has enacted two stringent emission

control programs for motor vehicles: one for light and

medium-duty motor vehicles, including certain diesel-fueled

vehicles (the “LEV Program”), and one for heavy-duty urban

transit buses (the “Urban Bus Program’).

a. The LEV Program

_In adopting the LEV Program in 1990-1991, CARB estab-

lished the most stringent exhaust regulations ever for light

and medium-duty vehicles. The regulations include three

primary elements: (1) four tiers of exhaust emission stan-

dards for increasingly stringent categories of low-emission

vehicles; (2) a mechanism requiring manufacturers to phase

in a progressively cleaner mix of vehicles from year to year;

and (3) a requirement that a specified percentage of passen-

ger cars and lighter light-duty trucks be zero-emission

vehicles (“ZEVs”). (SR 1191-4, p. 7442).

The four tiers of exhaust emission standards, in descending

order of emission levels are: (1) Transitional Low-Emission

Vehicles (“TLEVs”); (2) Low-Emission Vehicles (“LEVs”);

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(3) Ultra-Low-Emission Vehicles (“ULEVs”); and (4) Zero-

Emission Vehicles (“ZEVs”). For each category a set of

more stringent emission standards for carbon monoxide,

nitrogen oxides and formaldehyde applies. ‘The LEV Pro-

gram achieves emission reductions by requiring manufactur-

ers to sell progressively cleaner mixes of vehicles over time.

The average emissions from the mix of these categories of

vehicles produced by a given manufacturer in a given year

must meet an overall “fleet average” requirement. Automo-

bile manufacturers, under CARB’s regulations, have the

flexibility to decide how many vehicles of each type they

manufacture and sell in order to meet the fleet average.

Additional flexibility is provided through the establishment

of a marketable credit system: manufacturers may earn

credits if they sell more LEVs than needed to meet the fleet

average.

b. The Urban Bus Program

On February 24, 2000, CARB adopted its Urban Bus Pro-

gram (“UBP”) to further reduce air pollution from large

urban transit buses. The UBP requires: (i) reductions in

particulate matter (“PM”) and oxides of nitrogen (“NOx”)

fleet emissions by urban transit bus operators; and (ii)

stringent exhaust emission standards applicable to engine

manufacturers. To implement the CARB regulation, urban

transit bus fleet operators are required to choose between two

different compliance paths: (i) a diesel path or (ii) an alterna-

tive fuel path. Fleet operators were required to notify CARB

of their choice by January 31, 2001.

Fleet operators choosing the diesel path may continue to

purchase diesel powered buses as long as they comply with

emission standards. These emission requirements specify

that engines meet an eighty-percent (80%) PM emission

reduction by October 2002. For the 2004 model year, CARB

established an optional NOx emission standard representing

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an eighty-seven percent (87%) emission‘ decrease relative to

the current NOx standard. For the 2007 model year, diesel

transit bus engines must comply with a NOx emission

standard that would result in a ninety-five percent (95%)

emission decreases relative to the current NOx standard.

Transit agencies on the diesel path with more than 200 urban

buses in their active fleet (on January 31, 2001) must place

into service at least three zero-emission buses (“ZEBs”) by

July 1, 2003, and operate them for a year as a required

demonstration project. From model year 2008 through

model year 2015, a minimum fifteen percent (15%) of all

new bus purchases or leases must be ZEBs for the transit

Agencies on the diesel path. (SR 1192-4, p. 7545). ZEBs

must be certified by CARB and are expected to be powered

by fuel cells, electricity, or other fuels that result in

zero-emission exhaust levels. (SR 1192-5, p. 7546).

The Alternative-Fuel Path requires at least eighty-five

percent (85%) of new bus purchases to be alternative-fueled.

Alternative fuels are defined as compressed natural gas,

liquefied natural gas, liquefied petroleum gas, methanol,

electricity, fuel cells, or other advanced technologies that do

not rely on diesel fuel. (SR 1192-6, p. 7547; SR 1192-2, p.

7543). Transit operators would need to introduce ZEBs into

their fleets by 2010. Additionally, retrofit requirements to

reduce PM emissions from existing buses, are required under

both paths.

D. The Fleet Rules

In response to the need for the South Coast Basin to reduce

pollution levels dramatically to achieve its NAAQS, the

California state legislature in 1987 adopted Health and Safety

Code § 40447.5, which authorizes the SCAQMD to adopt

fleet rules in an effort to reduce public exposure to motor

vehicle pollution. On June 16, 2000, August 18, 2000, and

October 20, 2000, the SCAQMD adopted six rules (referred

l6a

to hereinafter as the “Fleet Rules”), each of which mandates

that when certain local operators of fleets purchase or replace

their fleet vehicles, they must acquire only those specific

motor vehicles that the SCAQMD has designated as meeting

its standards and requirements.

]. Fleet Rule 1191

Rule 1191 requires passenger car, light-duty truck, or me-

dium-duty vehicle public fleet operators to acquire

low-emitting gasoline or alternative-fueled vehicles? when

procuring or leasing these vehicles in the District. The Rule

applies to all government agencies and any special districts

with 15 or more on-road light and medium-duty vehicles.

Rule 1191 also contains specified exemptions. (Rule

1191(f))

2. Fleet Rule 1192

Rule 1192 requires public transit fleet operators to acquire

alternative-fuel heavy-duty vehicles‘ when procuring Or

leasing vehicles to reduce air toxic and criteria pollutant

emissions. This Rule applies to public transit fleets with 15

or more public transit vehicle or urban buses, operated by

government agencies or operated by private entities under

contract to government agencies, that provide passenger

3} “Alternative-fueled vehicle” is defined under the Rule as “a

vehicle or engine that is not powered by gasoline or diesel fuel and

emits hydrocarbon, carbon monoxide, or nitrogen oxides, on an

individual basis at least equivalent to or lower than a ULEV based

on [C]ARB’s certification data.” (Rule 1191(c)(1)).

4 “Alternative-fuel heavy-duty vehicle” is defined as a

“heavy-duty vehicle, urban bus or engine that uses compressed or

liquified natural gas, propane, methanol, electricity, fuel cells, or

other advanced technologies that do not rely on diesel fuel,” and

that meets the emissions requirements of the Urban Transit Bus

Rule adopted by CARB. (Rule | 192(c)(1)).

17a

transportation services. The Rule requires these fleet opera-

tors to acquire alternative-fuel vehicles when adding or

replacing vehicles. Rule 1192 also contains specified exemp-

tions. (Rule 1192(e)).

3 Fleet Rule 1193

Rule 1193 requires public and private solid waste collec-

tion fleet operators to acquire alternative-fuel’ refuse collec-

tion heavy-duty vehicles when procuring or leasing these

vehicles. The Rule applies to government agencies and

private entities that operate solid waste collection fleets with

15 or more solid waste collection vehicles. Acquisition of

dual-fueled vehicles® is allowed for fleets of 15 or more

transfer or rolloff vehicle.’ Rule 1193 also contains specified

exemptions. (Rule 1193(e)).

4. Fleet Rule 1194

Rule 1194 applies to public and private fleet operators of

15 or more vehicles that transport passengers from commer-

cial airports located in the District. The affected vehicles

include taxis, shuttles, and limousines. The Rule requires

> Under Rule 1193, “alternative-fuel heavy-duty vehicles” use

compressed or liquefied natural gas, liquefied petroleum gas,

methanol, electricity, fuel cells, or other advanced technologies

that do not rely on diesel fuel. (Rule 1193(c)(1)).

equipped with a diesel engine that uses an alternative fuel . . . in

combination with diesel fuel to enable compression ignition. A

dual-fuel engine typically used the alternative fuel to supply 85

percent of the total engine fuel requirement.***” (Rule

1193(c)(2)).

7 A “rolloff vehicle” is “any heavy-duty vehicle used for the

express purpose of transporting waste containers such as open

boxes or compactors.” (Rule 1193(c)(5)).

18a

passenger car, light-duty truck, medium-duty transit vehicle,

and heavy-duty transit vehicle fleet operators to acquire

cleaner burning or alternative-fueled vehicles* when procur-

ing or leasing these vehicles in the District, unless otherwise

exempt. Fleet operators using passenger cars or medium-

duty vehicles to provide airport transportation services must

purchase a specified percentage of vehicles that meet

CARB’s standards for ultra low emission vehicles. Fleet

operators that use heavy-duty vehicles must purchase alterna-

tive-fuel vehicles. Specified exemptions are provided for

under this Rule as well. (Rule 1194(e)).

5. Fleet Rule 1186.1

Rule 1186.1 requires certain public and private sweeper

fleet operators to acquire alternative-fuel or otherwise

less-polluting sweepers when purchasing or leasing these

vehicles for sweeping operations undertaken by or for

governments or governmental agencies in the District’s

jurisdiction. Rule 1186.1 also requires government agencies

that contract for sweeping services to solicit bids or contract

for services that use alternative-fuel sweepers. An “alterna-

tive-fuel sweeper” is one with “engine(s) that use compressed

or liquefied natural gas, liquefied petroleum gas (propane),

methanol, electricity, or fuel cells. Hybrid-electric and

dual-fuel technologies that use diesel fuel are not considered

alternative-fuel technologies for the purposes of this rule.”

(Rule 1186.1(c)(2)). Specified exemptions are also provided

for. (Rule 1186.1(f)).

6. Fleet Rule 1196

Rule 1196 requires public fleet operators of heavy-duty

vehicles to acquire alternative-fuel heavy-duty vehicles when

8 An “alternative-fueled vehicle” means “a light or medium-duty

vehicle, or heavy-duty transit vehicle or engine that is not powered

by gasoline or diesel fuel.” (Rule 1194(c)(2)).

19a

procuring or leasing these vehicles. The Rule applies to all

government agencies located in the District and to any

special districts such as water, air, sanitation, transit, and

school districts, with 15 or more heavy-duty vehicles. These

operators must acquire alternative-fuel vehicles, dual-fuel

vehicles, or dedicated gasoline vehicles when adding or

replacing heavy-duty vehicles. Specified exemptions are

provided for under the Rule as well. (Rule 1196(f)).

E. Procedural History

On November 21, 2000, Plaintiff EMA filed its First

Amended Complaint against the SCAQMD Defendants for

declaratory and injunctive relief, challenging the constitu-

tionality of the Fleet Rules. Specifically, Plaintiff EMA

claims the Fleet Rules violate Sections 209 and 177 of the

federal Clean Air Act, 42 U.S.C. §§ 7543 and 7507, as well

as the Supremacy Clause of the United States Constitution,

U.S. Const. Art. V1, cl. 2, and are therefore preempted as a

matter of law. On January 17, 2001, Plaintiff-in-Intervention

WSPA also brought suit against the SCAQMD Defendants

and the Environmental Intervenors for declaratory and

injunctive relief, claiming the Fleet Rules violate CAA

§§ 209 and 177 and the Supremacy Clause.°

On March 23, 2001, Plaintiffs and Defendants filed cross

motions for summary judgment. Plaintiffs moved for sum-

mary judgment on counts one (1) through six (6) of their

respective Complaints.'° On April 20, 2001 California

9 Plaintiff EMA and Plaintiff-in-Intervention WSPA will herein-

after collectively be referred to as “Plaintiffs.” The SCAQMD

Defendants and Defendants-in-Intervention Environmental

Intervenors will hereinafter collectively be referred to as “Defen-

dants.”

'0 On July 25, 2001 the parties entered into a stipulated dismissal

of count seven (7) of Plaintiff EMA’s First Amended Complaint.

20a

Attorney General Bill Lockyer submitted an amicus curiae

brief on behalf of the State of California in support of Defen-

dants’ Motions for Summary Judgment and in opposition to

Plaintiffs’ Motions for Summary Judgment.

The parties have stipulated that this case should be adjudi-

cated on the pleadings, as no material factual disputes are at

issue. The case turns entirely on the scope of the express

preemption provisions of §§ 209 and 177 of the Clean Air

Act. After considering the parties’ written and oral argu-

ments, the Court issues the following decision:

DISCUSSION

A. ~ CAA § 209(a)

Section 209(a) of the Clean Air Act provides:

No State or any political subdivision thereof shall adopt

or attempt to enforce any standard relating to the con-

trol of emissions from new motor vehicles or new mo-

tor vehicle engines subject to this part. No State shall

require certification, inspection, or any other approval

relating to the control of emissions from any new motor

vehicle or new motor vehicle engine as condition

precedent to the initial retail sale, titling (if any), or reg-

istration of such motor vehicle, motor vehicle engine, or

equipment. 42 U.S.C. § 7543(a).

Plaintiffs argue that the Fleet Rules violate CAA § 209(a)

because they constitute “standard{s] relating to the control of

emissions from new motor vehicles or new motor vehicle

engines.” Plaintiffs also assert that the Fleet Rules establish

unlawful conditions precedent to the sale of new motor

vehicles or engines.

2la

The Court does not accept Plaintiffs’ interpretation of the

impact of the Fleet Rules. The Rules regulate the purchasing

and leasing, not the sale, of vehicles by fleet operators. Fleet

operators are required to purchase “cleaner” vehicles when

adding or replacing fleet vehicles. The Fleet Rules accept as

given the existing CARB vehicle standards; they merely

require fleet operators to choose from among the least

polluting of CARB-certified, available vehicles. The Rules

impose no new emission requirements on manufacturers

whatsoever, and therefore do not run afoul of Congress’s

purpose behind motor vehicle preemption: namely, the

protection of manufacturers against having to build engines

in compliance with a multiplicity of standards. See People of

State of Cal. ex rel. State Air Resources Bd. v. Department of

Navy, 431 F.Supp. 1271, 1285 (N.D.Cal.1977), aff'd by 624

F.2d 885 (9th Cir.1980) (“The reasons given for the enact-

ment of the preemption provision can be summarized as

follows: to protect the manufacturer against having to build

engines, which would comply with a multiplicity of stan-

dards; to protect the vehicle owner from having to deal with

different standards in each state in which he drives; to avoid

the unnecessary duplication of federal standards; to avoid

“unnecessary expense’ to the owner; and generally to avoid

‘chaos’ and ‘confusion.’ ” (internal citations omitted)).

Furthermore, the Fleet Rules do not set a “standard relating

to the control of emissions.” Rather than imposing any

numerical control on new vehicles, the rules regulate the

purchase of previously-certified vehicles. Plaintiffs rely

primarily on two cases to support their contention that the

Fleet Rules constitute unlawful standards: Am. Auto. Mfrs.

Ass'n Vv. Cahill, 152 F.3d 196 (2d Cir.1998) and Ass'n of Int'l

Auto. Mfrs., Inc. v. Commissioner, 208 F.3d 1 (1st Cir.2000).

These cases hold that an attempt to limit the sale of vehicles

is preempted. In Cahill and Commissioner, the states of New

York and Massachusetts, respectively, adopted California’s

emission standards targeting ZEVs. Under the California

22a

regulations, two percent (2%) of all new vehicles certified for

sale in California for model years 1998-2000, five percent

(5%) for model years 2001-2002, and ten percent (10%) for

model year 2003 were required to be ZEVs. California's

program was granted a § 209(b) waiver by the E.P.A. in

1993, and New York and Massachusetts adopted the program

pursuant to CAA § 177.'' Both the Second Circuit in Cahill

and the First Circuit in Commissioner held that “the ZEV

sales requirement must be considered a standard ‘relating to

the control of emissions.”” Cahill, 152 F.3d at 200; Commis-

sioner, 208 F.3d at 6. The ZEV program mandated that a

specified percentage of cars sold by manufacturers in any

\| In Cahill, the state of New York adopted California’s LEV

program for light-duty vehicles pursuant to the CAA’s opt-in

provision. New York’s classification system, fleet average

requirements, and ZEV sales requirements were identical, with one

exception, to those of California for model years 1998-2003. That

exception concerned medium-duty vehicles, which were included

in California’s ZEV requirements but not in New York’s. Addi-

tionally, New York maintained the ZEV sales requirement for

model years 1998-2002 even after California had abandoned it.

The automobile manufacturers associations brought suit to prevent

the enforcement of New York’s 1998-2002 ZEV sales require-

ment.

In Commissioner, automobile manufacturers brought suit

against the Massachusetts Department of Environmental Protec-

tion, claiming automobile emission standards adopted by the state

of Massachusetts were preempted by the CAA. After California

repealed its ZEV requirements for the model years 1998-2000, it

entered into memoranda of agreements (“MOAs”) with seven

major automakers by which the manufacturers agreed to develop

ZEV technology and introduce a limited number of ZEVS into the

California market. In exchange, California agreed to provide

infra-structural support for ZEV implementation. Massachusetts

amended its ZEV mandates to reflect the automakers’ obligations

under the MOAs, but did not include the reciprocal obligations

undertaken by California.

23a

model year be ZEVs. “The ZEV sales requirement is,

therefore, in the nature of a command having a direct effect

on the level of emissions, rather than in the nature of a means

of enforcing, or testing the effectiveness of, a command.”

Cahill, 152 F.3d at 200.

It does not follow, however, that a rule regulating the pur-

chase of vehicles is such a standard. The Fleet Rules require

purchasers to choose from among a subset of previously

certified California vehicles. Where a state regulation does

not compel manufacturers to meet a new emissions limit, but

rather affects the purchase of vehicles, as the Fleet Rules do,

that regulation is not a standard. No restriction on the sale of

vehicles is present here. Plaintiffs may continue to sell any

vehicle which is otherwise certified in California.

Furthermore, CAA § 246, 42 U.S.C. § 7586, expressly

recognizes that Fleet Rules must be established in areas with

particularly high pollution levels, and authorizes restrictions

on the purchase of fleet vehicles to meet clean-air standards.

Specifically, section 246 requires that “{e]ach state in which

there is located all or part of a covered area * * * shall

subriit* ** a State implementation plan revision * * * to

establish a clean-fuel vehicle program for fleets under this

section.” 42 U.S.C. § 7586(a)(1). Section 246 also mandates

that “a specified percentage of all new covered fleet vehi-

cles * * * purchased by each covered fleet operator in each

covered area shall be clean-fuel vehicles and shall use clean

alternative fuels. ***” 42 U.S.C. § 7586(b). It is not

rational to conclude that the CAA would authorize purchas-

ing restrictions on the one hand, and prohibit them, as a

prohibited adoption of a “standard,” on the other.

Additionally, through its Health and Safety Code, Califor-

nia has mandated these Rules be enacted by Districts with

severe air quality problems. The South Coast Air Basin is

the only “extreme” nonattainment area for ozone in the

24a

country. It is classified as a “severe” nonattainment area for

particulate matter and has extremely high levels of toxic air

pollution throughout the region. The California legislature

enacted Health and Safety Code § 40447.5 in response to the

need for the South Coast Air Basin to reduce pollution.

Section 40447.5 authorizes the District to “[rjequire opera-

tors of public and commercial fleet vehicles * * * in the south

coast district, when adding vehicles to or replacing vehicles

in an existing fleet or purchasing vehicles to form a new

fleet, to purchase vehicles which are capable of operating on

methanol or other equivalently clean burning alternative fuel

and to require that these vehicles be operated, to the maxi-

mum extent feasible, on the alternative fuel when operating

in the south coast district.” Such state regulations are pre-

sumed to be valid. See, e.g., Medtronic, Inc. v. Lohr, 518

U.S. 470, 475, 116 S. Ct. 2240, 135 L. Ed. 2d 700 (1996)

(stating that the preemption analysis begins with the pre-

sumption that local police powers, such as air pollution

prevention, are not preempted: “Throughout our history the

several states have exercised their police powers to protect

the health and safety of their citizens. Because these are

‘primarily, and historically, * * * matter(s] of local concern,

the ‘States traditionally have had great latitude under their

police powers to legislate as to the protection of the * os

health * * * of all persons.”’) (internal citations omitted)

(cited in Exxon Mobil Corp. v. U.S. Envtl, Prot. Agency, 217

F.3d 1246, 1255 (9th Cir.2000)).

The Court therefore concludes that the Fleet Rules do not

constitute unlawful standards “relating to the control of

emissions.”

B. Section 177

Plaintiffs argue that the Fleet Rules violate CAA § 177,

which provides:

25a

Notwithstanding section 7543(a) of this title, any State

which has plan provisions approved under this part may

adopt and enforce for any model year standards relating

to control of emissions from new motor vehicles or new

motor vehicle engines and take such other actions as are

referred to in section 7543(a) of this title respecting

such vehicles if 4(1) such standards are identical to the

California standards for which a waiver has been

granted for such model year, and

(2) California and such State adopt such standards at

least two years before commencement of such model

year (as determined by regulations of the Administra-

tor).

Nothing in this section or in subchapter II of this chap-

ter shall be construed as authorizing any such State to

prohibit or limit, directly or indirectly, the manufacture

or sale of a new motor vehicle or motor vehicle engine

that is certified in California as meeting California stan-

dards, or to take any action of any kind to create, or

have the effect of creating, a motor vehicle or motor

vehicle engine different than a motor vehicle or engine

certified in California under California standards (a

“third vehicle”) or otherwise create such a “third vehi-

cle.”

42 U.S.C. § 7507.

As discussed earlier, CAA § 177 permits states other than

California to “piggyback” onto California’s standards if the

state’s standards are identical to California standards for

which a waiver has been granted for a model year. Section

177, however, applies only to non-California “opt-in” states.

The statutory language supports this conclusion. After first

referring to states that adopt the California standards, section

177 declares that “any such state” is subject to certain

limitations. The word “such” indicates that the statute is

26a

referring back to the non-California “opt-in” states. Section

177 has no application to the right of the District to regulate

the purchase of fleet vehicles.

Furthermore, Congress’ purpose in enacting § 177 is to

prevent states from adopting and enforcing standards in a

manner that would create a “third vehicle.” See Motor

Vehicle Mfrs. Ass'n, 17 F.3d at 528. Evident in the statutory

scheme is Congress’ desire not to burden manufacturers with

“myriad state emission regulations.” /d. at 531. Congress

restricted states to duplicating either federal or California

standards in order “to protect motor vehicle manufacturers

from the undue burden of complying with more than two

different regulatory schemes.” Am. Auto. Mfrs. Assn V.

Comm'r, 998 F.Supp. 10, 13 (D. Mass.1997) (quoting Motor

Vehicle Mfrs. Ass'n, 810 F.Supp. at 1339).

{Section 177] prevents opt-in states from imposing dif-

ferent emission requirements on new vehicles and en-

gines that would place an undue burden on manufactur-

ers by requiring them to produce materially different

new vehicles for sale in such areas. To the extent that a

manufacturer could demonstrate that each vehicle leav-

ing the assembly line performs at levels to which it was

certified, that manufacturers could claim ‘undue bur-

den’ if a state that adopted the California standard ap-

plied enforcement procedures that would require mate-

rials [sic].changes in the manufacture of such vehicles,

i.e., production of a third car.

Senate Comm. on Pub. Works, 103d Cong., Ist Sess., A

Legislative History of the Clean Air Act Amendments of

1990, Serial No. 103-38, Vol. 1 at 1022. Therefore, “there

can only be two types of cars in this country: ‘California’

cars or ‘federal’ cars’. States cannot adopt any other stan-

dards which would require automakers to create a ‘third’

car.” Commissioner, 998 F. Supp. at 13.

27a

The Fleet Rules impose no such “third car” requirement.

Rather, they require purchasers to choose from among a

subset of previously certified vehicles. Automobile manufac-

turers will not be forced to do something more than they

already must do. Restricting purchases to the types of

engines already approved in California and for which a

waiver has been granted will not violate § 177’s “third

vehicle” prohibition. Section 177 bans any requirement for a

third vehicle, not all requirements intended to reduce motor

vehicle emissions. The CAA and its legislative history show

that Congress limited the burden upon manufacturers to that

of designing and manufacturing two versions of each motor

vehicle, and no more. The Fleet Rules may lead to decreased

demand for some cars and trucks certified for sale in Califor-

nia, but the Rules do not require the manufacturers to build or

sell any particular model for this area. The Court concludes,

therefore, that even if § 177 were to apply, the Fleet Rules do

not run afoul of Congress’ purpose in enacting § 177.

Il. CONCLUSION

The Court concludes that the Fleet Rules are not preempted

by § 209(a) of the Clean Air Act and are a valid exercise of

the SCAQMD’s authority. Section 177 does not apply to the

District’s Fleet Rules. Plaintiffs’ Motions for Summary

Judgment as to counts one through six of their Complaints

are denied. Defendants’ Motions for Summary Judgment are

granted.

IT IS SO ORDERED.

28a

APPENDIX C

IN THE UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

No. 01-56688

(D.C. No. CV-00-09065-FMC)

ENGINE MANUFACTURERS ASSOCIATION, ef al.,

Plaintiffs-Appellants,

SOUTH COAST AIR QUALITY MANAGEMENT DisTRICT, ef al.,

Defendant:-Appellees.

Filed December 11, 2002

ORDER

Before: GOODWIN, RYMER, and McKEOWN, Cir-

cuit Judges.

The panel has voted unanimously to deny the petition for

rehearing. Judges Rymer and McKeown have voted to deny

the petition for rehearing en banc, and Judge Goodwin

recommended denial.

29a

. The full court has been advised of the petition for rehear-

ing en banc and no active judge has requested a vote on

whether to rehear the matter en banc. Fed.R.App.P.35.

The petition for rehearing is DENIED and the petition

for rehearing en banc is DENIED.

30a

APPENDIX D

IN THE UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

No. 02-16395

(D.C. No. CV-F-02-5017 REC/SMS)

CENTRAL VALLEY CHRYSLER-PLYMOUTH, INC., ef al.,

Plaintiffs-Appellees,

\ -

MICHAEL P. KENNY,

Defendant-Appellant.

EXCERPT OF BRIEF OF THE UNITED STATES AS

AMICUS CURIAE IN SUPPORT OF AFFIRMANCE

INTEREST OF THE AMICUS CURIAE

As part of the Energy Policy and Conservation Act, Con-

gress has mandated federal fuel economy standards. In so

doing, Congress also expressly preempted any state laws or

regulations relating to fuel economy standards. The United

States has a substantial interest in enforcing the federal fuel

economy standards and in ensuring that states adhere to the

Congressional directive prohibiting them from “adopt[ing]} or

enforce[ing]” any “law or regulation related to fuel economy

standards or average fuel economy standards for automo-

biles.” 49 U.S.C. § 32919(a).

3la

STATEMENT OF THE ISSUE

Whether the provisions of the California’s Zero Vehicle

Emission regulations granting credits for hybrid vehicle, if

they meet specified criteria, are preempted under 49 U.S.C.

§ 32919(a), because the criteria are defined in reference to

fuel economy standards.

STATEMENT OF THE CASE

1. Federal Fuel Economy Standards.

a. In the aftermath of the 1973-1974 Arab oil embargo,

Congress in 1975 enacted the Energy Policy and Conserva-

tion Act (“EPCN”). The EPCA was intended to conserve

energy, to increase the supply of fossil fuels in the United

States, and to reduce American dependence on foreign oil.

See S. Rep. No. 516, 94th Cong., Ist Sess. 116, reprinted in

1975 U.S. Code Cong. & Ad. News 1956, 1957.

Title [II of the EPCA added a new Title V to the Motor

Vehicle Information and Cost Savings Act, introducing a

program of mandatory fuel economy standards for passenger

cars and light trucks to be implemented by the Department of

Transportation. See P.L. 94-163, 89 Stat. 901, codified as

amended at 49 U.S.C. § 32901, et seg. For model year 1985,

Congress set a 27.5 miles per gallon (“mpg”) fuel economy

standard, a figure that would represent an approximate

doubling of then-existing average passenger car fuel econ-

omy. 49 U.S.C. § 32902(b). Congress authorized the agency

to modify the 27.5 mpg standard for a particular model year

to the level which it determines is the “maximum feasible

average fuel economy level” for that year. 49 U.S.C. §

32902(a). The statute sets out four criteria for the agency to

apply in determining maximum feasible average fuel econ-

omy standards. 49 U.S.C. § 32902(f). The agency must

consider (1) technological feasibility; (2) economic practica-

32a

bility, (3) the effect of other motor vehicle standards on fuel

economy, and (4) the need of the Nation to conserve energy.

Ibid.

The Act does not require that every vehicle, or every

model, meet the fuel economy standard for a given model

year. The Act requires instead that the average fuel economy

level of all of a manufacturer’s passenger cars and light

trucks meet the applicable standard. Thus, the fuel economy

standard which a manufacturer is required to meet for a given

model year is known as the Corporate Average Fuel Econ-

omy or “CAFE” standard, and the level which the manufac-

turer actually achieves in a given model year is known as the

CAFE level. 49 U. S.C. § 32902; see, e.g. 67 Fed. Reg.

16052 (2002) (establishing the light truck CAFE level for

model year 2004).

Federal law defines an “automobile” as a “four-wheeled

vehicle that is propelled by fuel, or by alternative fuel,

manufactured primarily for use on public streets, roads, and

highways,” with a gross vehicle weight rating up to 10,000

pounds. See 49 U.S.C. § 32901(a)(3). See also 49 C.F.R. §

523.3 (defining “automobile” under the CAFE program).

Furthermore, 49 U.S.C. § 32901(a)(3) defines “alternative

fuel” to include “electricity.” An “alternative fueled auto-

mobile” means an automobile that either has a single “dedi-

cated” fuel type (such as natural gas or electricity) or is “dual

fueled,” meaning that it uses regular fuels such as gasoline as

well as an alternative fuel. Jd. at §§ 32901(a)(2)(A) and

32901(aX2B).

Federal law specifically addresses the manner in which cars

running on “alternative fuel” are to be factored into a manu-

facturer’s CAFE rating, requiring that the CAFE calculation

include all vehicles, including electric vehicles and should

include the “equivalent petroleum based fuel economy values

33a

determined by the Secretary of Energy for various classes of

electric vehicles.” 49 U.S.C. § 32904(a)(2)(B).

b. In enacting the federal CAFE standards, Congress ex-

plicitly and broadly preempted all state laws relating to fuel

economy standards:

[w]hen an average fuel economy standard prescribed

under this chapter is in effect, a State or a political sub-

division of a State may not adopt or enforce a law or

regulation related to fuel economy standards or average

fuel economy standards for automobiles covered by an

average fuel economy standard under this chapter.

49 U.S.C. § 32919%(a).

2. The Clean Air Act.

The Clean Air Act (“CAA”) also contains a preemption

provision. It provides that “no State or any political subdivi-

sion thereof shall adopt or attempt to enforce any standard

relating to the control of emissions from new motor vehicles

or new motor vehicle engines.” 42 U.S.C. § 7543(a). The

CAA, however, permits California to adopt standards for the

control of emissions from new motor vehicles that are in the

aggregate at least as protective of public health and welfare

as federal standards. See 42 U.S.C. § 7543(b). The Admin-

istrator of EPA must waive preemption under the Clean Air

Act for those state standards, unless the Administrator makes

specified findings regarding protectiveness, necessity, and

consistency with certain Clean Air Act provisions. /bid.

3. California's ZEV Program.

The California Air Resources Board first adopted the Zero

Emissions Vehicle (“ZEV”) program in 1990 as part of its

efforts to regulate exhaust emissions from automobiles.

2001-19 Cal. Reg. L. Bull. 204. See 13 Cal. Code Regs.

34a

§ 1962. The regulations originally required large automakers

to produce vehicles as a specified percentage of their fleet

that produce no exhaust emissions of criteria pollutants or

their precursors. Excerpts of Record (“ER”) 364. In the face

of questions regarding the feasibility of these goals, the

Board repeatedly amended the ZEV regulations, ultimately

issuing in 2001 the final rule at issue in this litigation. See 13

Cal. Code Regs. § 1962.

The rule at issue requires that for model years 2003 through

2008, at least 10% of the passenger cars and light-duty trucks

produced by a manufacturer and delivered for sale in Cali-

fornia must be ZEVs. 13 Cal. Code Regs. § 1962(b)(1)(A);

ER 367. After that date, the percentage rises incrementally to

16% for 2018 and subsequent model years. 13 Cal. Code

Regs. § 1962(b)(1)(A); ER 367.

The regulations contemplate that it would be too costly for

manufacturers to meet these standards solely by the produc-

tion of pure Zero Emission Vehicles. ER 362-363. Accord-

ingly, the regulations allow manufacturers to accrue “ZEV

credits” through the production of “Partial Zero Emission

Vehicles” or “PZEVs,” and “advanced technology” PZEVs.

See 13 Cal. Code Regs. § 1962(c). Automobiles can qualify

for an allowance as advanced technology PZEVs “if the

manufacturer demonstrates to the reasonable satisfaction of

the [State] Executive Officer that the vehicle is equipped

with advanced ZEV componentry such as an advanced

battery integral to the operation of the vehicle power train or

an electric power train.” See 13 Cal. Code Regs.

§ 1962(c)(4)(B).

Gasoline-electric hybrid vehicles can qualify as advanced

technology PZEVs—and hence qualify for ZEV credits—but

only if they meet one of the alternative standards prescribed

in the regulations. See 13 Cal. Code Regs. § 1962(c)(4)(B);

ER 403. These include the “Efficiency Method” and the

35a

“Carbon Dioxide (CO) Reduction Method.” 13 Cal. Code

Regs. § 1962(c)(4)(B)(1) and (2).

a. The Efficiency Method.

For a hybrid vehicle to qualify for credits under the “Effi-

ciency Method,” the vehicle must achieve a certain level of

efficiency as measured by its federal fuel economy rating as

compared with the class average. See 13 Cal. Code Regs.

§ 1962(c)(4)(B)(2), ER 403. As provided under the Effi-

ciency Method, a vehicle’s “Advanced Componentry Allow-

ance” is measured through a formula under which its “Cali-

fornia Miles Per Equivalent Gallon” is divided by a function

of its “Baseline Fuel Economy.” 13 Cal. Code Regs.

§ 1962(c)(4)(B)(2).

* * *

4. Proceedings Below.

Plaintiffs—General Motors Corporation, Daimler-Chrysler

Corporation, and severai California automobile deal-

ers—sought to enjoin enforcement of the 2001 regulations,

arguing that the regulations fall within the broad preemption

of the EPCA. ER 1-15. California argued that its rule

permissibly regulates emissions and that the provisions

relating to fuel economy standards merely represented some

of the options by which manufacturers could comply with the

regulatory standards.

Plaintiffs filed a motion for a preliminary injunction. ER

163-165. After a hearing and extensive briefing, the court

granted plaintiffs’ motion. ER 1052-1067. The court found

that plaintiffs had demonstrated a “strong likelihood of

success on the merits of their claim that the AT PZEV option

set forth in the 2001 ZEV amendments is completely pre-

empted by [49 U.S.C. § 32919(a)] * * * and that plaintiffs

will suffer irreparable injury if the requested preliminary

36a

injunction is not granted because of the very substantial costs

of compliance with the 2001 ZEV Amendments.” ER 1066.

In holding that plaintiffs were likely to prevail on their

preemption claim, the court explained, “{pjlaintiffs have

shown that the 2001 ZEV amendments ‘relate to’ fuel

economy standards because they clearly have the purpose of

regulating the fuel economy performance of * * * advanced

technology hybrids * * * [that plaintiffs] predict [ ] the

industry will sell in California.” ER 1056-1057. The court

noted that the specific state regulations incorporate federal

fuel economy test procedures, and that qualifying vehicles

are credited based upon their fuel consumption as measured

using the federal procedure. ER 1057. The court found that

the state regulations have the practical effect of regulating

fuel economy based on California’s calculation of the ex-

pected number of hybrids that would use the advanced

technology provision to earn additional credits. The court

rejected the State’s argument that the preemption provision

should not apply because the State’s requirements are fo-

cused on the reduction of emissions, and do not conflict with

the objectives of the CAFE provisions. The court explained,

“{p]reemption cannot be avoided by intertwining preempted

requirements with nonpreempted requirements.” ER 1059.

The court also rejected the State’s contention that the avail-

ability of other options for obtaining ZEV credits saved from

preemption the options linked to fuel economy. ER

1060-1061. The court found that options linked to fuel

economy would be the lowest cost options available and that

the other options did not in fact offer a “viable alternative.”

ER 1061.

The court then determined that the automakers would suf-

fer irreparable injury from enforcernent of the 2001 ZEV

rules. The court found that the automakers had shown that

would have to spend hundreds of millions of dollars to

comply with the 2001 ZEV regulations (accord Cal. Br. 19),

37a

and that those investments could not be recovered from

California due to sovereign immunity. ER 1065.

SUMMARY OF ARGUMENT

A. In the Energy Policy and Conservation Act, Congress

expressly preempted all state laws or regulations “related to

fuel economy standards or average fuel economy standards

for automobiles covered by an average fuel economy stan-

dard under this chapter.” 49 U.S.C. § 32919%a). The phrase

“related to” used in a preemption statute “express[es] a broad

preemptive purpose,” Morales v. Trans World Airlines, Inc.,

504 U.S. 374, 378 (1992), and, here, preempts any state

statute or regulation “if it has a connection with or reference

to” fuel economy standards. FEgelhoff v. Egelhoff ex rel.

Breiner, 532 U.S. 141, 147 (2001).

Under the “connection with or reference to” standard em-

braced wy the Supreme Court, the California regulations at

issue here clearly are preempted. Specifically, the regula-

tions’ “Efficiency Method,” “CO, Reduction Method,” and

“High-Efficiency Allowance” all refer t@ fuel economy

ratings and provide credits or allowances based on the level

of a vehicle’s fuel economy rating. For example, a threshold

fuel economy level must be met to qualify for credits under

the “CO, Reduction Method.” Then, once that threshold

level is met, the number of credits earned deperids upon the

vehicle’s fuel economy rating: the better the fuel economy

ratings, the greater the ZEV credits.

Because these California regulations directly refer to fuel

economy levels, and because manufacturer credits are based

on the level of a vehicle’s fuel economy rating, they are

preempted under the plain terms of section 32919(a).

B. The State argues that these standards are not preempted

because manufacturers may also meet ZEV requirements

38a

through various alternative means. The Supreme Court,

however, has rejected the notion that a state’s provision of

options or even the ability to freely opt out of the state law

provision saves the state law from the effects of an express

federal preemption statute. See Egelhoff v. Egelhoff ex rel.

Breiner, supra.

The primary case relied upon by the State, Ray v. Atlantic

Richfield Co., 435 U.S. 151 (1978), is not to the contrary.

Ray did not involve an express preemption provision, such as

the one here, addressing a particular subject that Congress

has determined may not be the subject of state regulation.

ARGUMENT

THE CALIFORNIA 2001 ZEV REGULATIONS ARE

PREEMPTED UNDER 49 U.S.C. § 32919%a).

A. Article VI of the United States Constitution commands

that the laws of the United States “shall be the supreme Law

of the Land; * * * any Thing in the Constitution or Laws of

any State to the Contrary notwithstanding.” Art. VI, cl. 2.

See also McCulloch v. Maryland, 4 Wheat. 316, 427 (1819)

(“It is of the very essence of supremacy, to remove all

obstacles to its action within its own sphere, and so to modify

every power vested in subordinate governments”). Thus, “[a]

fundamental principle of the Constitution is that Congress

has the power to preempt state law.” Crosby v. National

Foreign Trade Council, 530 U.S. 363, 372 (2000). See also

Gibbons v. Ogden, 9 Wheat. 1, 211 (1824). “State law may

be preempted “by express language in a congressional

enactment, * * * by implication from the depth and breadth

of a congressional scheme that occupies the legislative

field, * * * or by implication because of a conflict with a

39a

congressional enactment.” Lorillard Tobacco Co. v. Reilly,

533 U.S. 525, 540 (2001).

In the present case, state law has been preempted by ex-

press language in a congressional enactment. The Energy

Policy and Conservation Act provides that when a federal

fuel economy standard is in effect “a State or a political

subdivision of a State may not adopt or enforce a law or

regulation related to fuel economy standards or average fuel

economy standards for automobiles covered by an average

fuel economy standard under this chapter.” 49 U.S.C.

§ 32919%(a).

The phrase “related to” in the statute is broad on its face,

and as the Supreme Court has held in interpreting similar

language in other preemption statutes, “express[es] a broad

preemptive purpose.” Morales v. Trans World Airlines, Inc.,

504 U.S. 374, 378 (1992) (interpreting the preemption

provision of the Airline Deregulation Act, 49 U.S.C.

§ 41713); see also American Airlines, Inc. v. Wolens, 513

U.S. 219 (1995). In Morales, the statute at issue expressly

preempted the States from “enact[ing] or enforc[ing] any

law, rule, regulation, standard, or other provision having the

force and effect of law relating to rates, routes, or services of

any air carrier.” Morales v. Trans World Airlines, Inc., 504

U.S. at 383. The Court recognized that the “ordinary mean-

ing” of the key phrase “relating to” “ is a broad one—‘to

stand in some relation; to have bearing or concern; to pertain;

refer; to bring into association with or connection with,’

Black’s Law Dictionary 1158 (Sth ed. 1979)}—and the words

thus express a broad preemptive purpose.” /bid.

In another context where Congress used similar lan-

guage—29 U.S.C. § 1144(a}—preempting all state laws

“related to” an ERISA plan—the Supreme Court has ad-

dressed the phrase many times and has “observed repeatedly

that this broadly worded” language is “clearly expansive.”

40a

Egelhoff v. Egelhoff ex rel. Breiner, 532 U.S. 141, 146

(2001). See also Shaw v. Delta Air Lines, Inc., 463 US. 85,

96-97 (1983) (the “breadth of [the ERISA provision’ s]

preemptive reach is apparent from [its] language”), Metro-

politan Life Ins. Co. v. Massachusetts, 471 US. 724, 739

(1985) (the “related to” language has a “broad scope”); Pilot

Life Ins. Co. v. Dedeaux, 481 US. 41, 46-47, 107 S. Ct.

1549, 1552-1553, 95 L. Ed. 2d 39 (1987) (the language has

an “expansive sweep,” and must be read as “deliberately

expansive”); Ingersoll-Rand Co. v. McClendon, 498 US.

133, 138 (1990) (the preemption statute is “broadly

worded”); FMC Corp. v. Holliday, 498 U.S. 529 58 (1990)

(the statute is “conspicuous for its breadth”).

In the other contexts where Congress has employed the

“related to” language in a preemption provision, the Court

has explained that a state statute is preempted “if it has a

connection with or reference to such a plan.” Egelhoff, 532

U.S. at 147 (quoting Shaw v. Delta Air Lines, Inc., 463 U.S.

at 97) (emphasis added). See also Morales v. TWA, 504 U.S.

at 384 (adopting the same standard for the Airline Deregula-

tion Act preemption provision).

Whatever the outer limits of this expansive “related to”

language may be, they need not be decided in this case,

however, because the preemption provision of the Energy

Policy and Conservation Act clearly encompasses the Cali-

fornia regulations at issue here. Under the “connection with

or reference to” standard embraced by the Supreme Court,

there can be no question that the California regulations at

issue here are subject to preemption because they expressly

speak in “reference to” fuel economy ratings, with regulatory

credits for vehicle manufacturers based on the level of the

fuel economy rating.

This is most evidently the case with the “Efficiency

Method,” which allows manufacturers to qualify for ZEV

4la

credits by producing hybrid vehicles with a federal fuel

economy rating at least 30% better than a standard level set

by the regulations. See 13 Cal. Code Regs.

§ 1962(c)(4\(B)(2); ER 64-65. The regulations provide

regulatory credits for the vehicle manufacturer based solely

on comparing the vehicle’s fuel economy ratings, measured

using the federal test procedure, to a specified class average

fuel economy.

Av bettom, the State asks this Court to ignore the statutory

laumgguage ad io deduce whether Congress would have

standards for vehicle manufacturers, because they are a part

of a regulatory program addressing emissions. As the Su-

preme Court has recently observed, however, such “[a]

freewheeling judicial inquiry into whether [state law] is in

tension with federal objectives would undercut the principle

that it is Congress [and federal agencies,] rather than the

courts[,) that pre-emp[t] state law.” Geier v. American

Honda Motor Co., 529 U.S. at 906 (brackets in original)

(quoting Gade v. National Solid Wastes Management Assn.,

505 U.S. at 111 (Kennedy, J., concurring)). In any event, the

“the plain language of the enacted text is the best indicator of

[congressional] intent.” Nixon v. United States, 506 U.S.

224, 231 (1993). Thus, when construing a preemption

statute, a court must “begin with the language employed by

Congress and the assumption that the ordinary meaning of

that language accurately expresses the legislative purpose.”

Morales v. Trans World Airlines, Inc., 504 U.S. at 383

(quoting FMC Corp. v. Holliday, 498 U.S. at 56-57). The

plain language of section 32919(a) clearly encompasses the

regulations at issue in this case. Accordingly, further inquiry

into whether Congress would have wanted to preempt the

regulations at issue here would be both unnecessary and

inappropriate.

42a

Even if California’s intent is to regulate emissions, it can-

not escape the effect of the EPCA preemption-provision. The

preemption provision contains no exceptions based on the

purpose or purposes of a state’s fuel economy regulation.

When state regulations by their terms make compliance by

the vehicle manufacturer dependent in whole or in part on a

vehicle’s fuel economy, as these regulations do, the terms

and purpose of the preemption provision are implicated

directly.

CONCLUSION

For the reasons stated above, the judgment of the district

court should be affirmed.

Respectfully Submitted,

ROBERT D. McCALLUM, JR.

Assistant Attorney General

JOHN K. VINCENT

United States Attorney

MARK STERN

(202) 514-5089

ROBERT M. LOEB

(202) 514-4332

Attorneys, Appellate Staff

Civil Division, Room 9126

Department of Justice

601 D Street, N.W.

Washington, D.C. 20530-0001

OCTOBER 2002

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.