Appendix — CleanCOALition v. TXU Power (No. 08-533)

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APPENDIX A — OPINION OF THE UNITED STATES

COURT OF APPEALS FOR THE FIFTH CIRCUIT

FILED JULY 21, 2008

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 07-50685

CLEANCOALITION; ROBERTSON COUNTY:

OUR LAND OUR LIVES

Plaintiffs-Appellants

TXU POWER, doing business as

TXU GENERATION COMPANY LP;

OAK GROVE MANAGEMENT COMPANY LLC;

TXU CORPORATION

Defendants-Appellees

Appeal from the United States Distriet Court

for the Western Distriet of Texas

Before REAVLEY, SMITH, and DENNIS, Circuit

Judges.

DENNIS, Circuit Judge:

This case of first impression involves the scope of

citizen-suit jurisdiction under the Clean Air Act (“CAA”).

See 42 U.S.C. § 7604(a). Plaintiffs-Appellants filed suit

to enjoin Defendants-Appellees from constructing a

Appendix A

pulverized coal-fired power plant in their community,

alleging various violations of the CAA preconstruction

permit process. The district court dismissed this case

on the ground that, inter alia, neither of the asserted

bases for subject matter jurisdiction, §§ 7604(a)(1) and

7604(a)(3), provides for jurisdiction in this case. For the

reasons stated herein, we agree and, therefore, affirm

the judgment of the district court.

I. BACKGROUND FACTS

CleanCOA Lition and Robertson County: Our Land,

Our Lives (collectively “Appellants”) are environmental

interest groups whose members are concerned with

environmental health issues, including air quality. TXU

Power, Oak Grove Management LLC, and TXU

Corporation (collectively “TX U”) are utility entities that

have proposed the construction of a pulverized coal-fired

power plant in Robertson County, Texas. Members of

Appellants reside in Robertson County and allege they

will be adversely affected by emissions from the plant.

On July 27, 2005, TXU applied for a preconstruction

permit with the Texas Commission on Environmental

Quality (“TCEQ”), which regulates the preconstruction

authorization process for the State of Texas under the

CAA’s Prevention of Significant Deterioration (“PSD”)

Program. See 42 U.S.C. § 7401, et seg. On February 21,

2006, the TCEQ completed a technical review of TXU’s

application and issued a preliminary decision and draft

permit. TXU requested the TCEQ to refer the

application to the State Administrative Office of

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Hearings (“SOAH”) for a hearing to determine whether it

complied with all relevant statutory and regulatory

requirements. One of the Appellants participated in this

hearing. On August 23, 2006, the SOAH issued a Proposal

for Decision approving the permit, subject to final review

by the TCEQ.

On December 1, 2006, after expiration of a 60-day

written notice,’ Appellants filed suit against TXU alleging

that its permit application does not comply with

requirements of the PSD Program. Specifically, Appellants

allege that (1) TXU is violating preconstruction emissions

standards and limitations mandated by the CAA; and

(2) TXU intends to construct its proposed plant without a

CAA-compliant permit. Appellants seek, inter alia,

(1) declaratory relief that TXU is in violation of the CAA;

(2) temporary and permanent injunctive relief prohibiting

the construction of the plant; and (3) an order that TXU

comply with the preconstruction requirements of the PSD

Program. They also seek an assessment of civil penalties

against TXU in the amount of $27,500.00 per day for each

violation.

On December 21, 2006, TXU filed a motion to dismiss

based on jurisdictional, justiciability, and abstention

grounds. On May 21, 2007, the district court granted the

1. Prior to filing certain citizen suits, the CAA requires

that aggrieved parties give 60 days notice of the standard,

limitation, or order alleged to be violated to (1) the EPA, (2) the

state in which the alleged violation occurred, and (3) the alleged

violator. See 42 U.S.C. § 7604(b). Here, Appellants sent the

requisite notice.

Appendix A

motion to dismiss. Specifically, the district court held that

(1) Section 7604(a)(1) does not authorize citizen suits to

redress alleged pre-permit, preconstruction, pre-operation

CAA violations; (2) Section 7604(a)(3) of the CAA does not

authorize preconstruction citizen suits against entities that

either have obtained a permit or are in the process of doing

so; (3) Appellants failed to present a live case or controversy

because the state permit process is still ongoing; and

(4) even if it had subject matter jurisdiction, the district

court would abstain from exercising it pursuant to Burford

v Sun Oil Co, 319 U.S. 315, 63 S.Ct. 1098, 87 L.Ed. 1424

(1943) because timely and adequate state court review was

available and the exercise of federal review would disrupt

state efforts to establish a coherent policy with respect to

a matter of substantial public concern. Appellants filed a

timely notice of appeal.

2. Subsequent to the filing of this appeal, on June 13, 2007,

the TCEQ voted to grant the permit and on June 20, 2007, issued

an order to that effect. On August 8, 2007, the TCEQ overruled

a motion for rehearing. Separate entities—other than the

parties in this case—have since filed suit in state court

challenging the issuance of the permit. TXU has filed an

unopposed motion for this court to take judicial notice of these

facts. A court may take judicial notice of a fact that is “not subject

to reasonable dispute in that it is either (1) generally known

within the territorial jurisdiction of the trial court or (2) capable

of accurate and ready determination by resort to sources whose

accuracy cannot reasonably be questioned.” Fed. R. Evid. 201(b).

“An appellate court may take judicial notice of facts, even if

such facts were not noticed by the trial court.” United States v.

Herrera-Ochoa, 245 F.3d 495, 501 (5th Cir.2001) (citing

Fed.R.Evid. 201(f)). We agree that these facts are the kind of

which this court could take judicial notice, though they do not

alter our disposition in this case.

Appendix A

II. STATUTORY AND REGULATORY

FRAMEWORK

Congress enacted the 1970 Amendments to the CAA

to establish “a comprehensive national program that

made the States and the Federal Government partners

in the struggle against air pollution.” GM Corp. v.

United States, 496 U.S. 530, 582, 110 S.Ct. 2528, 110

L.Ed.2d 480 (1990). The 1970 Amendments indicate,

however, that although “[f]ederal financial assistance and

leadership is essential for the development of

cooperative Federal, State, regional, and local programs

to prevent and control air pollution,” see 42 U.S.C.

§ 7401(a)(4), “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

responsibility of States and local governments.”

See 42 U.S.C. § 7401(a)(3). Thus, while the Amendments

assign the Environmental Protection Agency (“EPA”)

the responsibility for “prescribing a national primary

ambient air quality standard and a national secondary

ambient air quality standard” for certain pollutants,

see 42 U.S.C. § 7409(1)(A), they assign the States the

primary responsibility 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 [(‘NAAQS’] will

be achieved and maintained within each air quality

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

see also 42 U.S.C. § 7410(a)(1) (“Each State shall...

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Appendix A

adopt . . a a plan which provides for implementation,

maintenance, and enforcement of such primary .. . [and]

secondary standard in each air quality control region

(or portion thereof) within such State.”). They further

mandate that each State implementation plan (“SIP”)

include a permit program. See 42 U.S.C. § 7410(a)(2)(C).

In Texas, the TCEQ administers the State CAA permit

program.“

In 1977, further amendments were made to the

CAA in which Congress enacted the PSD Program,

see 42 U.S.C. 88 7470-7492, because the then-existing

EPA New Source Performance Standards did too little

to “achiev[e] the ambitious goals of the 1970

Amendments.” Envtl. Def v. Duke Energy Corp., 127

S.Ct. 1423, 1429 (2007) (citation omitted). Thus, the 1977

Amendments [gave] added protection to air quality in

certain parts of the country ‘notwithstanding attainment

and maintenance of’ the NAAQS.” Id. at 1427 (quoting

3. Although, the EPA is required to approve SIPs that

provide for the timely attainment and subsequent maintenance

of primary and secondary ambient air standards as well

as satisfy other CAA general requirements, see 42 U.S.C.

§ 7410(a)(3), the EPA has no authority to question the wisdom

of a State’s choices of emission limitations if they are part of a

SIP that otherwise satisfies the standards set forth in 42 U.S.C.

§ 7410(a)(2). “Thus, so long as the ultimate effect of a State’s

choice of emission limitations is compliance with the national

standards for ambient air, the State is at liberty to adopt

whatever mix of emission limitations it deems best suited to its

particular situation.” Train v. NRDC, 421 U.S. 60, 79, 95 S.Ct.

1470, 43 L.Ed.2d 731 (1975); see also Union Elec. Co. v. EPA, 427

U.S. 246, 268-69, 96 S.Ct. 2518, 49 L.Ed.2d 474 (1976).

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42 U.S.C. § 7470(1)). They also “assure[d] that any

decision to permit increased air pollution in any area to

which this section applies is made only after careful

evaluation of all the consequences of such a decision and

after adequate procedural opportunities for informed

public participation in the decisionmaking process.” 42

U.S.C. § 7470(5). To ensure CAA compliance, Congress

mandated the issuance of PSD permits before

construction of any “major emitting facility.”

See 42 U.S.C. § 7475(a)(1).

Under the 1977 Amendments—similar to the 1970

Amendments—“[s]tates have the primary role in

administering and enforcing the various components of

the PSD program.” ADEC v. EPA, 540 U.S. 461, 491

(2004) (quoting 57 Fed.Reg. 28,095 (1992)). However,

Congress has set forth explicit substantive and

procedural requirements that must be met prior to the

construction of any major emitting facility. The

substantive requirements include, inter alia, a

demonstration that: (1) “emissions from construction or

operation of such facility will not cause, or contribute

to, air pollution in excess of any” applicable emission

standards; (2) “the proposed facility is subject to the

best available control technology for each pollutant;” (3)

the facility complies with any applicable Class I area

protection requirements; (4) “there has been an analysis

of any air quality impacts projected for the area as a

result of growth associated with such facility;” and (5)

“the person who owns or operates, or proposes to own

or operate, a major emitting facility for which a permit

Appendix A

is required under this part agrees to conduct such

monitoring as may be necessary to determine the effect

which emissions from any such facility may have, or is

having, on air quality in any area which may be affected

by emissions from such source.” See 42 U.S.C. §§

7475(a)(3)-(7), 7475(d). The procedural requirements

include, inter alia, a public hearing and an opportunity

for any interested person to appear and submit

comments on a proposed permit. See 42 U.S.C. §

7475(a)(2). The EPA further “interprets existing law and

regulations to require an opportunity for state judicial

review of PSD permit actions under approved PSD SIPs

by permit applicants and affected members of the public

in order to ensure an adequate and meaningful

opportunity for public review and comment on all issues

within the scope of the permitting decision, including

environmental justice concerns and alternatives to the

proposed source.” Approval and Promulgation of Air

Quality Implementation Plans; Commonwealth of

Virginia—Prevention of Significant Deterioration

Program, 61 Fed.Reg. 1880 (Jan. 24, 1996) (to be codified

at 40 C. F. R. pt. 52) (The EPA).

The State of Texas has an EPA-approved PSD

Program. See Approval and Promulgation of

Implementation Plans; Texas; Revisions to Regulations

for Control of Air Pollution by Permits for New Sources

and Modifications, 67 Fed.Reg. 58,697 (Sept. 18, 2002)

(to be codified at 40 C. FR. pt. 52). Pursuant to this

Program, “(bljefore work is begun on the construction

of a new facility or a modification of an existing facility

that may emit air contaminants, the person planning

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Appendix A

the construction or modification must obtain a permit or

permit amendment from the commission.” Tex. Health &

Safety Code § 382.0518(a). The general requirements for

a permit are set forth in Title 30 of the Texas

Administrative Code, Sections 116.111 and 116.160-63. In

reviewing a PSD permit application, Texas law provides

an opportunity for public comment. See 30 Tex. Admin.

Code § 55.150, et seg. Texas law also permits any person

granted party status to request and participate in

contested hearings before the SOAH. See 30 Tex. Admin.

Code § 55.200, et seg. Finally, Texas law allows for state

judicial review over any permit decision. See Tex. Gov’t

Code § 2001.001, et seq.

III. ANALYSIS

The district court dismissed CleanCOALition’s

complaint in this case for lack of subject matter

jurisdiction, a decision of a legal question we review

de novo. Meredith u La. Fed n of Teachers, 209 F.3d 398,

402 (5th Cir.2000). “A case is properly dismissed for lack of

subject matter jurisdiction when the court lacks the

statutory or constitutional power to adjudicate the case.”

Home Builders Ass n of Miss., Inc. u City of Madison,

143 F.3d 1006, 1010 (5th Cir.1998) (quoting Nowak u

Ironworkers Local 6 Pension Fund, 81 F3d 1182, 1187

(2d Cir.1996)).

The jurisdictional question in this case involves

construction of the CAAs citizen-suit provisions. “[T]he

starting point in every case involving construction of a

statute is the language itself.” Greyhound Corp. v. Mt.

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Appendix A

Hood Stages, Inc., 437 U.S. 322, 330, 98 S.Ct. 2370, 57

L.Ed.2d 239 (1978); see also Sutton v. United States, 819

Fd 1289, 1292 (5th Cir.1987) (“We begin, as we must, with

an analysis of the text of the statute itself.”). “If the intent

of Cong ss is clear, that is the end of the matter; for the

court .. must give effect to the unambiguously expressed

intent of Congress.” Chevron U.S.A., Inc. u Natural Res.

Def Council, Inc., 467 U.S. 837, 842-43 (1984); see also

Birdwell u Skeen, 983 F.2d 1332, 1339 (5th Cir.1993)

(“Where the language of a statute is clear and

unambiguous, courts should not undertake to add to or

detract from its provisions.”). “In determining the meaning

of the statute, we look not only to the particular statutory

language, but to the design of the statute as a whole and

to its object and policy.” Crandon u United States, 494

U.S. 152, 158 (1990) (citing K Mart Corp. v. Cartier, Inc.,

486 U.S. 281, 291, 108 S.Ct. 1811, 100 L.Ed.2d 313 (1988));

Pilot Life Ins. Co. u Dedeaux, 481 U.S. 41, 51 (1987); see

also Robinson v. Shell Oil Co., 519 U.S. 337, 341 (1997)

(“The plainness or ambiguity of statutory language is

determined by reference to the language itself, the specific

context in which that language is used, and the broader

context of the statute as a whole.”); King u St. Vincent’s

Hosp., 502 U.S. 215, 221 (1991) (“{A] statute is to be read

as a whole . . . since the meaning of statutory language,

plain or not, depends on context.”).

We now turn to the statutory text in question. The

CAA provides for federal citizen suit jurisdiction in three

circumstances:

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Appendix A

(1) Against any person .. who is alleged to have

violated (if there is evidence that the alleged

violation has been repeated) or to be in violation

of (A) an emission standard or limitation under

this Act or (B) an order issued by the a

Administrator or a State with respect to such a ;

standard or limitation;

(2) Against the Administrator where there is

alleged a failure of the Administrator to perform

any act or duty under this Act which is not

discretionary with the Administrator, or

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(3) Against any person who proposes to

construct or constructs any new or modified

major emitting facility without a permit required

under part C of title I (relating to significant

deterioration of air quality) or part D of title I

(relating to nonattainment) or who is alleged to

have violated (if there is evidence that the

alleged violation has been repeated) or to be in

| violation of any condition of such permit.

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42 U.S.C. $§ 7604(a)(1)-(3).* Only the first and third

provisions are at issue in this case. We address each

provision in turn.

4. These provisions “provide citizen participation in the

enforcement of standards and regulations established under [the

CAA].” Natural Res. Def Council v. Train, 510 F.2d 692, 699

(D.C.Cir.1975) (citations omitted). They reflect Congress’s

recognition that “citizens can be a useful instrument for detecting

violations and bringing them to the attention of the enforcement

agencies and courts alike.” Jd. at 699-700 (citations omitted).

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Appendix A

A. Whether § 7604(a)(1) authorizes citizen suits to

redress alleged pre-permit, preconstruction, pre-

operation CAA violations?

The district court held that § 7604(a)(1) does not

authorize citizen suits to redress alleged pre-permit,

preconstruction, pre-operation CAA violations.

According to the district court, when a facility is still in

the pre-permit, preconstruction, pre-operation stage,

it has yet to emit anything and cannot be deemed “to

have violated .. . or be in violation of an emission

standard or limitation.” See 42 U.S.C. § 7604(a)(1); see

also Weiler v. Catham Forest Prods., Inc., 392 F.3d 532,

538 (2d Cir.2004) (LA § 7604(a)(1)] suit can only be

brought against a private defendant after a facility has

been built and begun operation.”); Sugarloaf Citizens

Ass’n v. Montgomery County, No. 93-2475, 1994 WL

447442 at *8 n. 9 (4th Cir. Aug. 17, 1994) (unpublished)

(“[U]ntil construction is completed... [Appellees] can

neither begin emissions nor violate any emissions

standard.”). Appellants, citing §§ 7604(f)(3) and

7604(f)(4),° respond that the phrase “emission standard

5. Section 7604(f) broadly defines an “emission standard or

limitation under this Act” as follows:

(1) a schedule or timetable of compliance, emission

limitation, standard of performance or emission

standard;

(2) acontrol or prohibition respecting a motor vehicle

fuel or fuel additive;

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Appendix 4

or limitation“ is defined broadly enough to encompass

preconstruction requirements and thus, TXU can be

deemed “to have violated . . . or be in violation of an

emission standard or limitation” simply by filing a permit

application without satisfying those requirements. We

address §§ 7604(f)(3) and § 7604(f)(4) in turn.

(Cont'd)

(3) any condition or requirement of a permit under part

C of title I (relating to significant deterioration of air

quality) [and other particular types of permits not

applicable here), any condition or requirement under an

applicable implementation plan relating to transportation

control measures, air quality maintenance plans, vehicle

inspection ana maintenance programs or vapor recovery

requirements, (fuel, fuel additives, visibility protection,

ozone protection, or stationary sources]; or

(4) any other standard, limitation, or schedule

established under any permit issued pursuant to title

V or under any applicable State implementation plan

approved by the Administrator, any permit term or

condition, and any requirement to obtain a permit as a

condition of operations;

which is in effect under this Act (including a

requirement applicable by reason of section 118 or

under an applicable implementation plan.)

42 U.S.C. 8 7604(f).

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Appendix A

1. Whether the definition of “emission standard

or limitation,” as set forth in § 7604(f)(3), is

broad enough to include requirements for

filing preconstruction permit applications?

Appellants first argue that because “emission

standard or limitation” is defined to include “any

condition or requirement of a permit under part C of

title I (relating to significant deterioration of air

quality),” see 42 U.S.C. § 7604(f)(3), which contains

preconstruction requirements, TXU can be deemed “to

have violated . . . or be in violation of an emission

standard or limitation” simply by filing a permit

application without satisfying those requirements. We

disagree. One can hardly be deemed to have violated a

“condition or requirement of a permit” simply by filing

an incomplete permit application, in response to which

a permit may or may not issue. See Miss. River Revival,

Inc. v. EPA, 107 FSupp.2d 1008, 1015 (D.Minn.2000)

(construing Clean Water Act citizen suit provision, which

was modeled after the CAA, and finding that it “does

not authorize jurisdiction for an action challenging the

contents of a permit application.”); Freeman v.

Cincinnati Gas & Elec. Co., No. 1:06CV179, 2005 WL

2837466, at *2 (S.D.Ohio Oct. 27, 2005) (holding that a

proposed Title V air permit cannot form the basis of a

citizen suit). Nevertheless, Appellants invite us to

interpret the phrase “any condition or requirement of a

permit” te mean “any condition or requirement to obtain

a permit.” We decline to do so. Instead, we interpret

the phrase “of a permit” as doing nothing more than

broadening the definition of “emission standard or

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Appendix 4

limitation” to include those conditions and requirements

found in any permit issued pursuant to any of the various

provisions listed in § 7604(f)(3).° Until the permit issues,

however, no “permit” exists to be violated. If Congress

wanted to define “emission standard or limitation” to

include any condition or requirement to obtain a

preconstruction permit, it certainly knew how to do so.

Indeed, the last clause of another section, § 7604(f)(4),

specifically defines “emission standard or limitation” to

include “any requirement to obtain a permit as a

condition to operations.” No similar counterpart exists

for a preconstruction permit, which is at issue in

this case and treated separately under the CAA.

Compare 42 U.S.C. § 7475 (preconstruction permits)

with 42 U.S.C. § 7661, et seg. (operation permits).

“Where Congress includes particular language in one

section of a statute but omits it in another section of

the same Act, it is generally presumed that Congress

acts intentionally and purposely in the disparate

6. The legislative history supports our interpretation.

Indeed, according to the Joint Explanatory Statement of the

Committee of Conference, §§ 7604(a)(3) and 7604(f)(3) permit

citizens suits to redress “the violation of any condition or

requirement specified by the State or the Administrator under

a significant deterioration or non-attainment permit.

See H. Conf. Rep. No. 564, at 173 (1977), as reprinted in 1977

U.S.C.C.A.N. 1502, 1554.

7. Although Appellants argued before the district court

that this clause provides an alternative basis for jurisdiction,

they have since abandoned that argument, most likely because

it applies to operation permits and here, Appellants are

challenging TXU’s application for a preconstruction permit.

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Appendix A

inclusion or exclusion.” Russello v. United States, 464

U.S. 16, 23 (1983). Thus, we presume that by not

including similar language for preconstruction permits,

Congress did not intend, by virtue of § 7604(f)(3), to

define “emission standard or limitation” to include

conditions or requirements to obtain such permits.

2. Whether the definition of “emission standard

or limitation,” as set forth in § 7604(f)(4), is

broad enough to include requirements for

filing preconstruction permit applications?

The first clause of § 7604(f)(4) presents a much more

difficult question. Appellants argue that because that

clause defines “emission standard or limitation” to

include “any other standard, limitation, or schedule

established ... under any applicable State

implementation plan,” see 42 U.S.C. § 7604(f), and such

plans also contain preconstruction requirements, TXU

can be deemed “to have violated . . . or be in violation of

an emission standard or limitation” simply by filing a

permit application without satisfying those

requirements. The district court, noting that Appellants

are challenging TXU’s application for a preconstruction

permit, rejected this argument on the ground that

§ 7604(f)(4) is limited, in its entirety, to operating

permits. We disagree. It is true that § 7604(f)(4) was

added as part of Title V of the CAA’s operating permit

program, see CAA Amendments, Pub.L. No. 101-549,

Title III, § 302(f), Title VII, § 707(a)-(g), 104 Stat. 2574,

2682 (1990), and that certain clauses of that section are

Appendix 4

expressly limited to operating permits.“ However, the first

elause is not so limited and broadly defines emission

standard and limitation” to include “any other standard,

limitation, or schedule established.. under any applicable

State implementation plan.” Jd. The CAA further defines

“applicable implementation plan” to include plans involving

both preconstruction and operating permits. See 42 U.S.C.

§ 7602(q).° Thus, the district court erred in concluding that

§ 7604(f)(4), in its entirety, is limited to operating permits.

See Conservation Law Found., Inc. v. Romney, 421

FSupp. 2d 344, 350 n. 6 (D.Mass.2006); Cmtys. for a Better

Env’t v. Cenco Ref Co., 180 F.Supp.2d 1062, 1082

(C.D.Cal.2001).

8. For example, § 7604(f)(4) broadens the definition of

“emission standard or limitation” to include “any other

standard, limitation, or schedule established under any permit

issued pursuant to title V” and “any permit term or condition,

and any requirement to obtain a permit as a condition of

operations.” See 42 U.S.C. § 7604(f)(4).

9. That section provides:

For purposes of this Act, the term “applicable

implementation plan” means the portion (or

portions) of the implementation plan, or most recent

revision thereof, which has been approved under

section 110 [involving preconstruction permit

programs], or promulgated under section 110(c), or

promulgated or approved pursuant to regulations

promulgated under section 301(d) [involving

operating permit programs) and which implements

the relevant requirements of this Act.

42 U.S.C. S 7602(q).

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Appendix A

TXU argues that the first clause of § 7604(f)(4) is

inapplicable for a different reason. According to it, the

terms “standards” and “limitations” in that clause refer

only to “emission standards” and “emission limitations,”

which are further defined in the CAA to mean “a

requirement established by the State or the

Administrator which limits the quantity, rate, or

concentration of emissions of air pollutants on a

continuous basis. ]“ See 42 U.S.C. § 7602(k). Thus, under

its interpretation, because permit application

requirements do not limit “the quantity, rate, or

concentration of emissions of air pollutants on a

continuous basis,” they are not “emission standards” or

“emission limitations” and, concomitantly, TXU cannot

be deemed to have violated or be in violation of such

standards and limitations simply by filing an alleged

incomplete permit application. We disagree with TX U’s

basic premise that the terms “standards” and

“limitations” in the first clause of § 7604(f)(4) refer only

to “emission standards” and “emission limitations.”

Indeed, the plain text of that clause defines “emissions

standards and limitations” to mean “any other standard,

limitation, or schedule established .. . under any

applicable State implementation plan.” 42 U.S.C.

§ 7604(f)(4) (emphasis added). The use of the term

“other” indicates that Congress intended those terms

to mean something more than just “emission

standards” and “emission limitations.” We decline to

import the word “emission” into a clause that does not

expressly include it. See Cmtys. for a Better Env’t, 180

F. Supp. 2d at 1081; see also Conservation Law

Foundation u FHA, 24 Fàd 1465, 1477 n. 5 (Ist Cir.1994)

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Appendix A

(“Defendants’ use of the definition for ‘emissions standard

or limitation’ provided in 42 U.S.C. § 7602(k) (a requirement

‘established by the State or Administrator’) is improper

because § 7604(f) defines this term for all of § 7604,

trumping the definition in § 7602(k).”).!°

Although we reject the district court and TXU’s

interpretations of § 7604(f)(4), we need not decide today

whether the definition of “emission standard or

limitation” is broad enough, by virtue of § 7604(f)(4), to

encompass preconstruction requirements because even

if that phrase is so defined, we fail to see how TXU could

be held to violate those requirements simply by filing

an incomplete permit application, in response to which

a permit may or may not issue, especially when the

permit process is still pending and subject to state

judicial review. See Miss. River Revival, 107 FSupp 2d

at 1015; Freeman, 2005 WL 2837466, at *2. Indeed, the

preconstruction requirements set forth in the Texas SIP

such as evidence that the facility will utilize the best

available control technology, are preconditions for

10. Moreover, TXU’s interpretation would render

superfluous another section, § 7604(f)(1), which already defines

the phrase “emission standard or limitation” to include an

“emission standard” or “emission limitation.” See 42 U.S.C.

§ 7604(f)(1). “It is a cardinal principle of statutory construction

that a statute ought, upon the whole, to be so construed that, if

it can be prevented, no clause, sentence, or word shall be

superfluous, void, or insignificant.” TRW Inc. v. Andrews, 534

U.S. 19, 31 (2001) (internal quotations and citation omitted);

see also Hoffman v. Kramer, 362 F.3d 308, 318 n.7 (5th Cir.2004).

‘

—

20a

Appendix A

granting a preconstruction permit, not preconditions for

filing a preconstruction permit application. See 30 Tex.

Admin. Code § 116.111(a). Presumably, an entity can file

as many incomplete permit applications as it so chooses,

but that does not mean in doing so, it is violating a

preconstruction requirement or an emission standard or

limitation. Moreover, the Eleventh Circuit has held,

following a long line of district court cases, that “violations

of the preconstruction permitting requirements occur at

the time of construction.” Natl Parks & Conservation

Ass nu TVA, 502 F:3d 1316, 1322 (11th Cir.2007) (collecting

cases and quoting New York u Niagara Mohawk Power

Corp., 263 FSupp. 2d 650, 661 (W.D.N.Y.2003)). Here, the

facility at issue has not yet begun construction and no

perinit has been issued. In short, we agree with the district

court’s ultimate conclusion that under the plain language

of § 7604(a)(1), TXU’s mere filing of an alleged incomplete

permit application does not constitute a violation of an

emission standard or limitation under the CAA and,

concomitantly, that subject matter jurisdiction is lacking

in this case.“

To the extent that Appellants argue that jurisdiction

under § 7604(a)(1) is implied in this case, “[ijt is an

elemental canon of statutory construction that where a

statute expressly provides a particular remedy or

remedies, a court must be chary of reading others into

it.” Middlesex County Sewerage Auth. v. Nat'l Sea

11. Whether § 7604(a)(1) redresses alleged preconstruction

violations against either TXU or the TCEQ once the permit

issues and/or construction of the facility commences are issues

we need not decide today.

2la

Appendix A

Clammers Assn., 453 U.S. 1, 14-15 (1981). As the

Supreme Court has explained, where Congress has

provided “elaborate enforcement provisions” for

remedying the violation of a federal statute—as

Congress has done with the CAA—“it cannot be

assumed that Congress intended to authorize by

implication additional judicial remedies for private

citizens suing under [the statute].” Jd. at 14, 101 S.Ct.

2615 (quoting Transamerica Mortgage Advisors, Inc.

v. Lewis, 444 U.S. 11, 19 (1979)). Here, Congress and

the EPA have set forth an elaborate enforcement

scheme through which citizens have an opportunity to

participate in public hearings and state court

proceedings involving the issuance of any construction

permit. See 42 U.S.C. § 7475(a)(2); see also Approval

and Promulgation of Air Quality Implementation Plans;

Commonwealth of Virginia—Prevention of Significant

Deterioration Program, 61 Fed.Reg. 1880 (Jan. 24, 1996)

(to be codified at 40 C. FR. pt. 52). It would seem odd

then that Congress would simultaneously authorize

citizens to bypass this process altogether and seek

simultaneous review in federal court.“

12. Appellants, citing Title V of the CAA, argue that such

dual enforcement is common. Although Title V of the CAA

provides for federal judicial review to evaluate the validity of

an operating permit, see 42 U.S.C. § 7661d(b)(2), it only does so

after the issuance of the permit and the subsequent denial of

the aggrieved party’s administrative petition for review. Thus,

contrary to Appellants’ interpretation, Title V does not provide

for simultaneous federal review while the state operating permit

process is still ongoing.

22a

Appendix A

B. Whether § 7604(a)(3) authorizes preconstruction

citizen suits against facilities that either have

obtained a permit or are in the process of doing so?

The district court held that § 7604(a)(3) does not

authorize preconstruction citizen suits against facilities

that have either obtained a permit or are in the process

of doing so. Instead, the district court interpreted that

section as authorizing citizen suits when an entity

proposes to construct or constructs a facility without a

permit whatsoever. We agree with the district court’s

interpretation. Appellants interpret the phrase “without

a permit” to mean “without a permit that complies with

the CAA.” !“ However, we decline to rewrite the plain

13. Appellants cite legislative history to support their

interpretation. According to the Senate amendment, “Section

[7604] . . is amended to allow a citizen to bring suit to prevent

construction of a major emitting facility without a permit in

compliance with [various sections of the CAA].” See H. Conf.

Rep. No. 564, at 173 (1977), as reprinted in 1977 U.S.C.C.A.N.

1502, 1553 (emphasis added). Appellants interpret the phrase

“without a permit in compliance with the CAA” to mean “without

a permit that complies with the CAA.” Thus, according to

Appellants, a facility can be deemed to have violated § 7604(a)(3)

simply by filing a permit application that fails to comply with

the CAA. However, whether the use of word “compliance” in

the Senate amendment necessarily means that Congress

intended to authorize citizen suits to second-guess state agency

permit determinations while those determinations are still

pending is far from clear. Moreover, the subsequent House

Conference Report, which concurs in the Senate amendment,

omits the phrase “in compliance with” altogether and simply

states that § 7604(a)(3) is amended so that “citizens suits are

(Cont'd)

;

F drr

„ X e

ee OE

S ede

23a

Appendix A

language of the statute. Here, not only has TXU applied

for a permit, it has since successfully obtained one,

though still subject to state judicial review. Thus, it can

hardly be said~—as Appellants must in order for

§ 7604(a)(3) to apply—that TXU is proposing to

construct or constructing a facility “without a permit.”

See Ogden Projects v. New Morgan Landfill Co., 911

F.Supp. 863, 867-68 (E.D.Pa.1996) (indicating that §

7604(a)(3) authorizes citizen suits when facility is

proposing to construct plant without a permit at all);

see also Heisen v. Pacific Coast Bldg. Prods., Inc., No.

93-16213, 1994 WL 250029, *1 (9th Cir. Jun. 9, 1994)

(unpublished) (rejecting attempt to utilize § 7604(a)(3)

to collaterally attack issuance of permit by alleging that

facility submitted fraudulent information to obtain it).

In short, we agree with the district court that §

7604(a)(3) does not authorize preconstruction citizen

suits against facilities that have either obtained a permit

or are in the process of doing so.

(Cont'd)

authorized against sources to enforce compliance only with

respect to... any proposal to construct or the construction of

any new or modified major emitting facility without a permit

under the prevention of significant deterioration provision or

the nonattainment provisions.” See H. Conf. Rep. No. 564, at

173 (1977), as reprinted in 1977 U.S.C.C.A.N. 1502, 1554

(emphasis added). Thus, the legislative history is less than

determinative and far from helpful.

24a

Appendix A

IV. CONCLUSION

For the foregoing reasons, we affirm the judgment

of the district court."

AFFIRMED.

14. Because we find the district court lacks subject matter

jurisdiction in this case, we do not address the remaining

justiciability and abstention issues reached by that court.

25a

APPENDIX B — ORDER OF THE UNITED STATES

DISTRICT COURT FOR THE WESTERN DISTRICT

OF TEXAS, WACO DIVISION

DATED AND FILED MAY 21, 2007

IN THE UNITED STATES DISTRICT COURT

FOR THE WESTERN DISTRICT OF TEXAS

WACO DIVISION

CIVIL ACTION NO. W-06-CA-355

CLEANCOALITION AND ROBERTSON COUNTY:

OUR LAND, OUR LIVES,

Plaintiffs,

TXU POWER, A D/B/A OF TXU GENERATION

COMPANY LP, OAK GROVE MANAGEMENT

COMPANY LP, AND TXU CORPORATION,

Defendants.

ORDER

Before the Court is Defendants Oak Grove

Management Company LLC, TXU Power, a D/B/A of

TXU Generation Company LP And TXU Corp.’s Motion

To Dismiss. The Court held a hearing on this Motion on

March 23, 2007. Having heard the arguments of the

parties and reviewed the Motion, Response, Reply,

pleadings, and applicable legal authority, the Court finds

that the Motion has merit and should be granted.

26a

Appendix B

I. BACKGROUND

The project at issue in this case is proposed by Oak

Grove Management LLC (“Oak Grove”) and consists of

the construction and development of a 1,720 MW power

generating facility in Robertson County (“the Project”).

The proposed facility will be fueled by Texas-mined

lignite. The Project will help fulfill a demand for

generation of power in Texas, and will result in

approximately 1,800 on-site construction jobs,

permanent employment of almost 2,000 persons, and

approximately $800 million in spending.

In order to construct the Project, on July 27, 2005,

Oak Grove applied to the Texas Commission on

Environmental Quality (“TCEQ”) for an air permit,

which includes a preconstruction authorization under

the Prevention of Significant Deterioration (“PSD”)

Program of the federal Clean Air Act (“CAA”).! Oak

Grove subsequently updated its application, and on

February 21, 2006, the TCEQ completed a technical

review of the application and issued a preliminary

decision and draft permit.

Oak Grove then requested that the TCEQ refer the

permit application to the State Administrative Office of

Hearings (“SOAH”) for a hearing to determine whether

it complied with statutory and regulatory requirements.

Plaintiff Robertson County: Our Land, Our Lives

(“RCOLOL’) participated as a party in the hearing

before SOAH. A Proposal for Decision was issued by

1. See Plaintiff’s Complaint, J 13, 25.

~~ 7" =. yee et ee

SP ae Od WY Ue

27a

Appendix B

SOAH on August 23, 2006. This decision is currently

being reviewed by the TCEQ to determine whether the

permit should issue.

On December 1, 2006, Plaintiffs CleanCoalition and

RCOLOL filed a citizen suit pursuant to the federal CAA

against Defendants TXU Power, a d/b/a of TXU

Generation Company, LP, Oak Grove Management

Company, LLC, and TXU Corporation (collectively

“Defendants”) regarding the Project. Defendants have

now filed a Motion to Dismiss under Fed. R. Civ. P

12(b)(1) and 12(b)(6).

II. LEGAL AUTHORITY

A. Standard of Review

Rule 12(b)(1) demands dismissal if the court lacks

jurisdiction over the subject matter of the plaintiff’s

claims. Fed. R. Civ. E 12(b)(1); Ramming v. United

States, 281 F.3d 158, 161 (5th Cir. 2001). Lack of subject

matter jurisdiction may be found in any one of three

instances: (1) the complaint alone; (2) the complaint

supplemented by undisputed facts evidenced in the

record; or (3) the complaint supplemented by undisputed

facts plus the court’s resolution of disputed facts.

Barrera-Montenegro u United States, 74 F.3d 657, 659

(5th Cir. 1996). The burden of proof in a Rule 12(b)(1)

motion to dismiss rests with the party asserting

jurisdiction. See Strain v. Harrelson Rubber Co., 742

Fd 888, 889 (5th Cir. 1984); Menchaca u Chrysler Credit

Corp., 613 F.2d 507, 511 (5th Cir. 1980). A case is

Pa eae Oe ee ee ee

28a

Appendix B

properly dismissed for lack of subject matter jurisdiction

when the court lacks the statutory or constitutional

power to adjudicate the case.“ Home Builders Ass N of

Miss., Inc. u. City of Madison, 143 F.3d 1006, 1010 (5th

Cir. 1998) (quoting Nowak v. Ironworkers Local 6

Pension Fund, 81 F.3d 1182, 1187 (2d Cir. 1996)). When

a Rule 12(b)(1) motion is filed in conjunction with other

Rule 12 motions, the court should consider the Rule

12(b)(1) jurisdictional attack before addressing any

attack on the merits. Ramming, 281 F.3d at 161. This

requirement prevents a court without jurisdiction from

prematurely dismissing a case with prejudice. /d.

A motion to dismiss under Rule 12(b)(6) “is viewed

with disfavor and is rarely granted.” Kaiser Aluminum

& Chemical Sales, Inc. v. Avondale Shipyards, Inc.,

677 F.2d 1045, 1050 (5th Cir. 1982), quoting 5 C. Wright

and A. Miller, Federal Practice and Procedure 5 1357 at

598 (1969). It is well settled that “a complaint should

not be dismissed for failure to state a claim unless it

appears beyond doubt that the Plaintiff can prove no

set of facts in support of his claim which would entitle

him to relief.” Conley v. Gibson, 355 U.S. 41, 45-46 (1957);

Boudeloche v. Grow Chemical Coatings Corps., 728 Fd

759, 762 (5th Cir. 1984); Kaiser, 677 F.2d at 1050. When

considering such a motion, the complaint must be

liberally construed in the plaintiff’s favor, and all facts

well pleaded in the complaint should be accepted as true.

Campbell u Wells Fargo Bank, N.A., 781 F.2d 440, 442

(5th Cir. 1986). “The question therefore is whether in

the light most favorable to Plaintiff and with every doubt

resolved in his behalf, the complaint states any valid

. *

29a

Appendix B

claim for relief.” 5 Wright and Miller, Federal Practice

and Procedure, Section 1357 at 601.

B. Statutory and Regulatory Background

Congress established in the CAA “a comprehensive

national program that ma[kes] the States and the

Federal Government partners in the struggle against

air pollution.” General Motors Corp. v. United States,

496 U.S. 530, 532 (1990). The Act makes clear, however,

that “air pollution prevention . . . and air pollution

control at its source is the primary responsibility of

States and local governments.” 42 U.S.C. § 7401(a)(3)

(emphasis added); see also id. § 7407(a). Thus, while the

CAA assigns EPA the responsibility for establishing

national ambient air quality standards (“NAAQS”) (i. e.,

the standards for the air we breathe) for certain

pollutants, see 42 U.S.C. § 7409, the Act assigns the

States the responsibility for ensuring compliance with

them through “State Implementation Plans” or “SIPs.”

See id. §§ 7407(a), 7410(a).

The SIPs are comprised of State regulations that,

among other things, set emission limitations for sources

in the State so as to meet and maintain the NAAQS.

SIPs include permitting programs such as the PSD

program cited in the Complaint. EPA must approve the

SIP for it to become effective under the federal CAA

(and such EPA approval is subject to judicial review in

the U.S. Court of Appeals, see 42 U.S.C. § 7607(b)(1)).

But EPA has no authority to second-guess the State’s

choice of emission limitations, so long as the SIP

30a

Appendix B

achieves its ultimate purpose of attaining and

maintaining the NAAQS. See Train v. NRDC, 421 U.S.

60, 79 (1975); see also Union Elec. Co. u EPA, 427 U.S.

246, 269 (1976).

In 1977, Congress enacted the PSD program at

issue in this case. 42 U.S.C. §§ 7470-7492. Like the

NAAQS program, PSD is implemented and enforced

primarily by the States through their SIPs. See, e.g.,

Alaska Dep't Envt’l Conserv. u EPA, 540 U.S. 461, 491

(2004) (ADEC) (citing 57 Fed. Reg. 28,095 (1992)

(“[S]tates have the primary role of administering and

enforcing the various componenis of the PSD

program.”)) The PSD program is a comprehensive

permitting scheme for “major emitting facilities” in

areas of the country that are designated having attained

the NAAQS (or are “unclassifiable” with respect to the

NAAQS). Thus, the cornerstone requirement of the PSD

program is that a new source (of a type and size subject

to PSD) must obtain a PSD permit before “construction

is commenced.” 42 U.S.C. § 7475(a)(1). Once the State’s

PSD program is approved as a part of the SIP it is the

State permitting authority, not EPA, that issues a PSD

permit for new facilities in that State.

Congress set both substantive and procedural

requirements that PSD permits must meet. The

substantive requirements include: (i) a demonstration

that the emissions from the new source will not adversely

affect air quality, id. $§ 7473, 7475(a)(3); (ii) installation

of the “best available control technology,” or “BACT,”

which is determined on a case-by-case basis by the State

3la

Appendix B

permitting agency, exercising its judgment on technical

issues and taking into account energy, environmental,

and economic impacts and other costs, id. §§ 7475(a)(4),

7479(3), see ADEC, 540 U.S. at 472-73, 494; (iii)

satisfaction of any applicable “Class I” area protection

requirements, 42 U.S.C. § 7475(a)(5); (iv) analysis of

any secondary air quality impacts, id. § 7475(a)(6); and

(v) monitoring requirements, id. § 7475(a)(7).

Congress also required elaborate procedural

safeguards for States to issue permits, including a public

hearing and an opportunity for any interested person

to appear and submit comments on a proposed permit.

Id. & 7475(a)(2). A State’s PSD program must contain

procedures that implement at least all of these statutory

requirements—substantive and procedural—to be

“approvable” as part of a SIP Furthermore, EPA has

interpreted the Act to require adequate procedures for

judicial review in State court of PSD permits issued by

a State before EPA will approve a PSD program into

the SIP 61 Fed. Reg. 1,880, 1,882 (1996); see ADEC, 540

U.S. at 508 (Kennedy, J., dissenting).

The State of Texas has a SIP-approved PSD

program that EPA found complies with all of the

procedural and substantive requirements of the statute,

and that program is administered by the TCEQ. See 67

Fed. Reg. 58,697-58,711 (2002). Under this approved

program, before construction can begin on proposed new

facilities that may emit air contaminants, the person

planning the construction must obtain a preconstruction

permit from the TCEQ. Tex. Health & Safety Code Ann.

: Pere Le se ee

32a

Appendix B

§ 382.0518. Preconstruction PSD permits are required

for proposed “major stationary source” facilities,

such as the Project, located in “attainment areas,”

such as Robertson County. 30 Tex. Admin. Code

§§ 116.111(a)(2)(1), 116.160-63. In reviewing a PSD

permit application, the TCEQ provides opportunity for

public comment. 30 Tex. Admin. Code Ann. § 55.150 et

seq. Additionally, persons may request and participate

in contested case hearings before the SOAH if they are

granted party status. Jd. § 55.200 et seg. The Texas air

permit process also provides for judicial review in state

court in Travis County of the TCEQ’s decision to issue

a permit. Tex. Gov’t Code Ann § 2001.001 et seq.

C. Citizen Suits

Section 7604 is the sole source of authority for

citizen suits under the federal CAA. This provision

authorizes citizen suits in only three circumstances:

(1) Against any person who is alleged to have

violated (if there is evidence that the alleged

violation has been repeated) or to be in

violation of (A) an emission standard or

limitation under this Act or (B) an order issued

by the Administrator or a State with respect

to such a standard or limitation,

(2) Against the Administrator where there is

alleged a failure of the Administrator to

perform any act or duty under this Act which

33a

Appendix B

is not discretionary with the Administrator?

(3) Against any person who proposes to

construct or constructs any new or modified

major emitting facility without a permit required

under part C of title I [42 USCS §§ 7470 et seq.]

(relating to deterioration of air quality) or part

D of title I [42 USCS 88 7501 et seq.] (relating

to nonattainment) or who is alleged to have

violated (if there is evidence that the alleged

violation has been repeated) or to be in violation

of any condition of such permit.

42 U.S.C. §§ 7604(a)(1) - (3).

D. Statutory Construction

Statutory construction begins with the plain

language of a statute, but “plain” does not always mean

“indisputable” or “pellucid.” Aviall Servs. v. Cooper

Indus., 312 F3d 677, 680 (5th Cir. Tex. 2002), rev'd on

other grounds, 543 U.S. 157 (2004). Consequently, sound

interpretation reconciles the text of a disputed provision

with the structure of the law of which it is a part; may

draw strength from the history of enactment of the

provision; and acknowledges the legislature’s general

policies so that the interpretation does not become

absurd. Id. (citing Crandon v. United States, 494 U.S.

2. 42 U.S.C. § 7604(a)(2) is not at issue in this case.

3. CAA §§ 304(a)(1) - (3).

34a

Appendix B

152, 158, 110 S. Ct. 997, 1001, 108 L. Ed. 2d 132 (1990)

(“In determining the meaning of the statute, we look

not only to the particular statutory language, but to the

design of the statute as a whole and to its object and

policy.“); Perrone u GMAC, 232 Fd 433, 440 (5th Cir.

2000) (stating that use of legislative history is

appropriate where statutory text is “opaque,”

“translucent,” or “ambiguous”), cert. denied, 532 U.S.

971 (2001); United States v. A Female Juvenile, 103 F.3d

14, 16-17 (5th Cir. 1996) (“Axiomatic in statutory

interpretation is the principle that laws should be

construed to avoid an absurd or unreasonable result.”);

In re Timbers of Inwood Forest Assocs., Ltd., 793 F.2d

1380, 1384 (5th Cir. 1986) (“Each part or section [of a

statute] should be construed in connection with every

other part or section so as to produce a harmonious

whole. Thus it is not proper to confine interpretation to

the one section to be construed.”)).

III. ARGUMENTS AND ANALYSIS

A. Standard of Review

Plaintiffs argue that because Defendants seek relief

under Rules 12(b)(1) and 12(b)(6), Defendant’s

requested relief should be evaluated solely under Rule

12(b)(6). See Williamson v. Tucker, 645 F.2d 404, 415-16

(5th Cir. 1981). Plaintiffs assert that when a defendant

chalienges both the court’s jurisdiction and the

existence of a federal cause of action, the Fifth Circuit

requires a court to find that jurisdiction exists and deal

with the objection as a direct attack on the merits.

35a

Appendix B

Plaintiffs argue that questions of subject matter

jurisdiction and the merits are normally considered

“intertwined” where a statute provides both the basis

of federal subject matter jurisdiction and the cause of

action. Clark u Tarrant County, Tex., 798 F.2d 736, 742

(5th Cir. 1986). Plaintiffs assert that both the subject

matter jurisdiction and the causes of action are provided

by 42 U.S.C. S 7604.

Defendants assert that it is not necessary to address

the “merits” of Plaintiffs’ case in order to rule on

Defendants’ Motion. Defendants argue that all facts

necessary to grant Defendants’ Motion are admitted in

Plaintiffs’ Complaint because Plaintiffs admit that an

application for a permit is pending before the TCEQ,

that construction has not commenced, and that no

permit has yet been issued on the pending application.

Even if the issue of jurisdiction were held to be

intertwined with the merits, Defendants argue that the

Complaint would still be subject to a facial attack under

Rule 12(b)(1), and if it fails to survive that challenge,

dismissal under Rule 12(b)(1) is appropriate. See Lewis

u. Knutson, 699 F.2d 230, 237 (5th Cir. 1983).

The Fifth Circuit stated in Lewis:

In the special case where the challenged basis

of jurisdiction is also an element of plaintiff’s

federal cause of action, the proper course of

action is to limit the jurisdictional inquiry to

facial scrutiny, and reserve the factual

scrutiny for the merits of the cause of action.

36a

Appendix B

See Williamson u Tucker, 645 Fd 404, 415 (5th

Cir.), cert. denied, 454 U.S. 897, 102 S. Ct. 396,

70 L. Ed. 2d 212 (1982) (quoting Bell u Hood,

327 U.S. 678, 682, 66 S. Ct. 773, 776, 90 L. Ed.

939 (1945)). If the facial attack defeats

jurisdiction, the case should be dismissed under

Rule 12(b)(1). If the case survives the facial

jurisdictional attack, a failure of the existence

of the cause of action should be disposed by a

Rule 12(b)(6) dismissal on the merits. See, e.g.,

Industrial Investment Development Corp. v.

Mitsui & Co., 671 F.2d 876, 886 & n. 9 (5th

Cir.1982). Conversely, if the jurisdictional

challenge does not implicate the merits of the

cause of action, the jurisdictional basis must

survive both facial and factual attacks before

the district court can address the merits of

the claim. See Williamson, 645 Fd at 412-15

& n. 9.

699 F.2d at 237. As Defendants argue, whether or not

the issue of jurisdiction is intertwined with the merits

in this case, Plaintiffs’ Complaint is subject to a facial

attack under Rule 12(b)(1). Accordingly, the Court

will limit its jurisdictional inquiry to facial scrutiny.

See Williamson, 645 Fd at 415.

37a

Appendix B

B. Section 304(a)(1)

Defendants argue there is no jurisdiction under

section 304(a)(1). First, Defendants argue that a project

that does not exist has zero emissions; thus, it cannot

be in violation of emission standards let alone have

repeated violations. See Sugarloaf Citizens Ass’n v.

Montgomery County, 33 F.3d 52 (Table), No. 93-2475,

1994 U.S. App. LEXIS 21985, at *20 n.9 (4th Cir. Aug.

17, 1994) (finding lack of citizen suit jurisdiction on

grounds that defendants “have all of the permits

required for the construction of this facility, and until

construction is completed. . ., can neither begin

emissions nor violate any emissions standard”). Second,

Plaintiffs’ suit is premised on a permit application.

Defendants argue that a permit application itself cannot

violate an “emission limitation;” thus, a citizen suit

cannot be based on a permit application. See Freeman

v. Cincinnati Gas & Electric Co., 2005 U.S. Dist. LEXIS

42524, *6-7 (S.D. Ohio October 27, 2005) (unpublished)

(holding that a proposed Title V air permit cannot form

the basis of a citizen suit); Mississippi River Revival,

Inc. u EPA, 107 F. Supp. 2d 1008, 1015 (D. Minn. 2000)

(construing the Clean Water Act citizen suit provision,

which was modeled after CAA § 304(a)(1), and finding

that it “does not authorize jurisdiction for an action

challenging the contents of a permit application.”).

Plaintiffs first respond that the only requirement

under section 304(a)(1) is that they must provide 60 days

notice, which they assert they provided to Defendants.

Plaintiffs also assert that the Court should consider the

Dre m eee

38a

Appendix B

definition of “emission standard or limitation” in section

304(f). Plaintiffs argue that the statute defines emission

standard or limitation” to include, among other things,

PSD requirements and SIP requirements. Plaintiffs

argue that violations of both PSD requirements and SIP

requirements will support a citizen suit under section

304(a)(1). See New York v. Niagara Mohawk Power

Corp., 263 F Supp. 2d 650, 663 (WD. N. V. 2003). However,

Plaintiffs also argue that the definition is much broader

because Courts construe the term to mean “any type of

control to reduce the amount of emissions in the air.”

See NRDC Uu EPA, 489 Fd 390, 394 n.2 (5th Cir. 1974),

rev'd on other grounds sub nom. Train v. NRDC, 421

U.S. 60 (1975). Plaintiffs assert the broad construction

stems from the definition in (f)(4): “any other standard,

limitation, or schedule established under any permit

issued pursuant to title V [ ] or under any applicable

State implementation plan approved by the

Administrator, any permit term or condition, and any

requirement to obtain a permit as a condition of

operations.” 42 U.S.C. § 7604(f)(4). Plaintiffs argue that

because Congress included this language regarding

requirements to obtain a permit, Congress intended

that a section (a)(1) claim may be based on a violation of

any pre-permit requirements imposed to obtain a

permit. Thus, Plaintiffs assert that it is possible to

violate an emission standard or limitation before a

permit is issued. Plaintiffs allege that Defendants

violated pre-permit requirements including “best

available control technology” (“BACT”) analysis, PSD

requirements during the permit application process,

SIP requirements during the permit application process,

F CE eS tM NN oe) I ye Sr er ům aS a eh ER eR ar

- — — — — * * a A *. he — * tL bee 2 > * 12 * 7

39a

Appendix B

and federal and state requirements imposed in order to

“obtain a permit” prior to beginning operation.

Defendants reply that Plaintiffs have paraphrased

the statutory definition of “emission standard or

limitation” and eliminated key language. Defendants

argue that this section does not define “emission

standard or limitation” in terms of “PSD” requirements”

but, rather “any condition or requirement of a permit

under” the PSD provisions. 42 U.S.C. § 7604(f)(3)

(emphasis added). Defendants assert that there is no

allegation in the Complaint that they are in violation of

any requirements or conditions of a PSD permit; thus,

because no permit has been issued, there is no

“condition or requirement of a permit” and no “emission

standard or limitation” at issue under section 304(f)(3).

Defendants argue that the language in section 304(f)(3)

regarding SIPs applies only to transportation control

measures, vehicle maintenance and inspection plans,

and other topics not related to PSD or this case.

Defendants argue that language in section 304(f)(4)

regarding SIPs clearly applies to “any other standard,

limitation, or schedule established . . under any

applicable State implementation plan,” and not the SIP

generally. Lastly, Defendants state that section 304(f)(4)

was added in 1990 as part of the Title V operating permit

program and is separate and apart from the PSD

construction permit program at issue in this case; thus,

it is not applicable here.

The Court finds that it lacks jurisdiction under

section 304(a)(1). Section 304(a)(1) allows a citizen suit

40a

Appendix B

against any person who is alleged to have violated or

who is in violation of an emission standard or limitation

under the Act. 42 U.S.C. § 7604(a)(1). The definition of

“emission standard or limitation” in section 304(f)(4) is

not applicable here because it applies to the operating

permit program. Plaintiffs have excluded key terms in

the definition in section 304(f)(3) to support their

argument. The definition states “any condition or

requirement of a permit under” the PSD provisions.

See 42 U.S.C. § 7604(f)(3) (emphasis added). Because

Plaintiffs do not allege any condition or requirement of

an issued permit in their Complaint, there is no

“emission standard or limitation” to consider under

section 304(a)(1). Based on the plain language of section

304(a)(1) and 304(f)(3), because no permit has issued for

the Oak Grove project and the Plant does not yet exist,

it cannot be in violation of any emission standards or

limitations. See id. §§ 7604(a)(1), (f)(3); Sugarloaf

Citizens, 1994 U.S. App. LEXIS 21985, at 20 n.9. Thus,

providing 60 days notice is not the only requirement

under section 304(a)(1). There must be an alleged

violation of a condition or standard of an issued permit.

Next, the Court distinguishes the Niagara Mohawk

case. In Niagera Mohawk, the defendants built a facility

without obtaining a permit at ali. See Niagara Mohawk,

263 F Supp. 2d at 654. Thus, the State brought a citizen

suit against the defendants under section 304(a)(1) and

304(a) (3). The district court held that some of the claims

were time barred but the citizen suit was proper.

Specifically under section 304(a)(1), the court stated the

permitting authority did not even have the opportunity

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Appendix B

to conduct a BACT analysis because of defendants

failure to follow the proper preconstruction procedures.

Id. at 663. Thus, the Court held that it would not be

proper to allow defendants to frustrate the goals of the

statute by dismissing Plaintiff’s claims under section

304(a)(1) because it appeared uncontroverted “that if

BACT had been determined by the permitting authority

and the Facilities were not in compliance, suit would be

authorized under” section 304(a)(1). Id. In contrast, the

TCEQ is still determining BACT for the Oak Grove

project as the State permitting process is not yet

complete for Plaintiffs’ permit application.

Lastly, Defendants’ permit application itself cannot

violate an emission standard or limitation, which is all

that Plaintiffs have alleged that Defendants have done

to this point. See Mississippi River, 107 F. Supp. 2d at

1015; Freeman, 2005 U.S. Dist. LEXIS 42524 at *6-7.

Congress expressly intended that the establishment of

an alleged violation not involve the “reanalysis of

technological or other considerations at the enforcement

stage.” Citizens Ass nu Washington, 535 Fd 1318, 1322

(D.C. Cir. 1976). If Plaintiffs believe Defendants’ permit

application contains information that may lead to

potential violations of emissions standards or limitations

when the Oak Grove project is constructed, the State

permitting process provides an opportunity for their

comments to be heard, and the TCEQ is the proper

authority to conduct a technical review of those

comments.

a E

42a

Appendix B

C. Section 304(a)(3)

Defendants argue there is no jurisdiction under

section 304(a)(3). First, Defendants assert that Oak

Grove has never stated any intention to construct the

plant without a permit—Plaintiffs even admit that Oak

Grove has submitted an application for a PSD permit,

and, at this time, the permit process is ongoing. Second,

Defendants argue that section 304(a)(3) does not provide

jurisdiction over complaints that a permit application is

allegedly defective. Defendants argue that section

304(a)(3) only authorizes suit for a failure to obtain a

permit at all. See Ogden Projects, Inc. v. New Morgan

Landfill Co, 911 F Supp. 863, 867-68 (E. D. Pa. 1996)

(“[A] substantive challenge to the conditions of the

permit would lie in state court, challenges based on the

state’s failure to require a permit at all are proper in

federal court.”). Defendants assert that these

circumstances are not met here because Oak Grove has

applied for a permit, the TCEQ has determined that a

permit is required, and the TCEQ is determining

whether the permit should issue and any terms and

conditions that may be necessary. Defendants assert

that the review of any permit granted and its terms and

conditions would occur in state court.

Plaintiffs argue that a permit based on a defective

application is not a permit in compliance with section

304(a)(3). Plaintiffs assert that a permit: (1) must be

based on supporting materials submitted by the

applicant and its agents; (2) must arise from a proper

BACT analysis; and (3) must set forth the parameters

‘ *

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43a

Appendix B

that will apply to the construction and operation of the

proposed facility. 42 U.S.C. § 7475(a). Plaintiffs assert

that an entity that proposes to construct a facility based

on a defective application is proposing to construct a

facility “without a permit required under part C.”

Plaintiffs allege that Defendants did not, among other

things, satisfy Part C permit requirements, which

include:

(1) analysis as to the proposed permit be

conducted in accordance with applicable

standards;

(2) demonstrate that emissions from

construction or operation of the Oak Grove

Plant will not cause, or contribute to, air

pollution in excess of the relevant standards;

(3) proposed facility be subject to BACT for

each pollutant subject to regulation under this

chapter emitted from or which results from,

such facility;

(4) analysis of any air quality impacts

projected for the area as a result of growth

associated with such facility; and

(5) owner/operator agree to conduct the

required monitoring.

42 U.S.C. § 7475(a)(2)-(4), (6)-(7). Plaintiffs argue that a

permit issued on the basis of a defective application also

44a

Appendix B

violates Part C. Thus, Plaintiffs assert that construction

of a facility pursuant to the non-compliant permit would

then violate Part C because the construction would

occur without a permit that satisfies the Part C

requirements. Plaintiffs argue that because of the

cascading effect of a permit application violation, the

CAA allows a citizen to sue before a facility is constructed

based on a proposal to construct that does not comply

with the PSD requirements for a permit application.

Plaintiffs assert that under Defendants’ interpretation

of section 304(a)(3), there would never be a section

304(a)(3) violation unless it could be brought pre-permit.

Lastly, Plaintiffs argue that the Court should follow the

U.S. Supreme Court in ADEC where it allowed the EPA

to seek judicial review of the reasonableness of a state

permitting agency’s BACT determination in issuing a

PSD permit. See ADEC, 540 U.S. at 484-93.

Detendants reply that Plaintiffs reading of section

304(a)(3) is an attempt to rewrite the phrase “without a

permit required under [PSD or nonattainment NSR]”

to “without a permit that complies with [PSD or

nonattainment NSR]....” Defendants argue that this

is not what the statute says and is not what Congress

intended the statute to say. Defendants argue that

determining the adequacy of information and analyses

included in a permit application and setting the terms

and conditions of a permit are clearly not the types of

actions that could give rise to “clear cut” violations

Congress intended such as not obtaining “a permit at

all.”

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45a

Appendix B

The Court finds that it lacks jurisdiction under

section 304(a)(3). Section 304(a)(3) allows a citizen suit

against any person who proposes to construct or

constructs any new or modified major emitting facility

without a permit required under part C. 42 U.S.C.

§ 7604(a)(3). Based on the plain language of the statute,

the Court finds that Congress intended the violation in

this provision to be proposing to construct or

constructing a facility without a permit at all (or violating

an existing permit). See Ogden Projects, 911 F Supp. at

867-68. Congress did not intend a federal CAA violation

for proceeding through the permitting process, which

would include determining the adequacy of information

and analyses proposed in the permit application and

setting the terms and conditions of the permit. The

determination of whether an entity is a polluter for

purposes of section 304 is to be made against the

objective standards in the administrative proceedings,

not in federal court. See Citizens Ass n, 535 Fd at 1322.

Congress did intend this provision to allow a federal

court in a citizen suit to force a party to get a permit if

it is going to build a major emitting air facility (or to

enforce the terms of an existing permit). Here, Oak

Grove applied for a permit, TCEQ determined that a

permit is required, and the TCEQ is now determining

whether the permit should issue and any terms and

conditions that may be necessary. Any review of the

permit and its terms and conditions would only be proper

in state court in Travis County.

Lastly, the Court distinguishes the ADEC case.

Section 113(a)(5) of the CAA authorizes EPA to bring

46a

Appendix B

an enforcement action to prohibit construction if it “finds

that a State is not acting in compliance with any

requirement or prohibition of the chapter relating to

the construction of new sources” (including the PSD

provisions). 42 U.S.C. § 7413(a)(5); see also id. § 7477

(authorizing EPA to enforce if construction does not

conform to the “requirements” of PSD). In ADEC, the

U.S. Supreme Court relied on the “any requirement”

language in sections 113(a)(5) and 167 to find that EPA

had the authority to enforce all of the individual

requirements of PSD. See ADEC, 540 U.S. at 484-85.

Thus, Congress gave the EPA broad jurisdiction to

enforce all requirements of PSD, including the

requirement to obtain a permit before construction. In

contrast, under the citizen suit provisions, Congress

gave limited jurisdiction to the violation of the

requirement to obtain a permit before commencing

construction (or for violating an existing permit).

See 42 U.S.C. § 7604(a)(3). Here, Plaintiffs are not the

EPA, they cannot step into the shoes of the EPA, and

the EPA has not joined their suit; thus, the ADEC case

is distinguishable.

D. Case or Controversy

Defendants also argue that there is no case or

controversy because Plaintiffs are seeking an advisory

opinion. They assert that any relief granted by this

Court would not be conclusive as to the issues raised

because Plaintiffs attack a mere permit application, and

it is the TCEQ that is responsible for reviewing the

application, determining its sufficiency, and issuing a

;

47a

Appendix B

permit with the terms and conditions it deems

are appropriate. See 30 Tex. Admin. Code Ann.

§§ 116.111(a)(2)(C); 116.114(a); 116.160(c); 116.160(d).

Defendants argue that even if the Court had the

jurisdiction to review the sufficiency of the permit

application and tell the TCEQ whether it is sufficient,

the TCEQ is not before this Court; thus, any decision

by the Court would be advisory.

Further, Defendants argue that Plaintiffs lack

standing. Plaintiffs state that their alleged injury is they

have “interests” in, among other things, breathing air,

enjoying outdoor recreation, scenery, and property, and

that the alleged deficiencies in the permit application

diminish these interests. Defendants assert that there

is no causal connection between the alleged injury and

the challenged conduct (c e., information contained in a

permit application), and their alleged injury is not fairly

traceable to Oak Grove’s conduct but to independent

action of the TCEQ, which is not before the Court.

Additionally, Defendants assert a claim is not redressable

if parties needing to be bound in order for the relief to

be effective are not before the Court or if the requested

relief is beyond the authority of the court. See Lujan v.

Defenders of Wildlife, 504 U.S. 555, 560-61 (1992); Baca

v. King, 92 F.3d 1031, 1037 (10th Cir. 1996). Defendants

argue that the TCEQ is not before the Court, and terms

and conditions of a permit are matters within the

TCEQ’s discretion but there is no assurance that TCEQ

ultimately would issue the permit in a way that

addresses Plaintiffs’ complaints.

48a

Appendix B

Plaintiffs assert that their federal CAA claims

embody a “case or controversy.” Plaintiffs assert that

regardless of what the TCEQ decides, Defendants have

violated the law independently. Further, Plaintiffs argue

that because TCEQ might later take action regarding

Defendants’ application does not make Plaintiffs’ claims

moot or unripe. Plaintiffs assert that there is no

difficulty in fashioning a remedy because they simply

seek an injunction prohibiting Defendants from violating

emissions standards and limitations and from

constructing a facility without a permit required by

Part C.

In addition, Plaintiffs assert that they do have

standing because they allege intermediate violations that

are properly the subject of a citizen suit. These

intermediate violations concern the proposed Oak Grove

Plant, which affects the areas in which Plaintiffs live,

work, and recreate. Thus, Plaintiffs argue they have a

concrete interest in requiring Defendants to comply with

the requirements of the federal CAA, and any injury to

Plaintiffs is traceable back to Defendants’ violations of

the law. Plaintiffs argue that the CAA requirements are

not intended only to control ultimate emissions, but also

to assure that any decision to permit increased air

pollution is made only after careful intermediate

evaluation of the possible consequences. 42 U.S.C.

§ 7470(5). Plaintiffs assert that Defendants, not the

TCEQ, are responsible for the Oak Grove Plant’s

construction; thus, if the Court enjoins Defendants from

construction in violation of the law, the injury will be

redressed. They assert that joinder of TCEQ is

unnecessary to achieve that goal.

49a

Appendix B

The Court finds there is no case or controversy.

Plaintiffs are seeking an advisory opinion because this

Court is not the responsible authority for reviewing

permit applications, determining their sufficiency, and

issuing permits with the terms and conditions that are

appropriate under the law. The TCEQ has this authority,

and the TCEQ is not before this Court. Further, Plaintiffs

lack standing because there is no causal connection

between their alleged injuries and the permit

application. The Court has already held that alleged

“intermediate” violations in a permit application do not

support a federal CAA citizen suit, which supports

Plaintiffs’ lack of standing. The TCEQ has the authority

to address Plaintiffs’ concerns, not this Court.

E. Burford Abstention

Alternatively, Defendants argue that if the Court

has jurisdiction, it should abstain from exercising

jurisdiction under Burford v. Sun Oil Co., 319 U.S. 315

(1943). Burford abstention is appropriate where “timely

and adequate state court review is available and where

the exercise of federal review of the question in a case

and in similar cases would be disruptive of state efforts

to establish a coherent policy with respect to a matter

of substantial public concern.” Wilson v. Valley Elec.

Membership Corp., 8 F.3d 311, 314 (5th Cir. 1993)

(internal quotations and citations omitted). Several

factors are relevant in making this determination:

(1) whether the cause of action arises under federal or

state law; (2) whether the case requires inquiry into

unsettled issues of state law; (3) the importance of the

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50a

Appendix B

state interest involved; (4) the state’s need for a

coherent policy in that area; and (5) the presence of a

special state forum for judicial review. Id.

Defendants argue that all of the factors weigh in

favor of Burford abstention. First, Defendants assert

that Plaintiffs’ cause of action, while asserted as a citizen

suit under the federal CAA, involves alleged violations

of state law and an attack on the state permitting

process. Defendants argue that regulation and control

of air pollution is recognized as an important state

function. 42 U.S.C. § 7401(a)(3). Second, the state needs

a coherent policy on the issues raised by Plaintiffs’ claims

because resolution of these issues may affect other

pending or proposed applications for permits for coal-

fired power plants, as well as air permitting in Texas in

general. Lastly, the TCEQ already has primary

jurisdiction for reviewing permit applications and

making the very technical determinations the Plaintiffs

are asking this Court to make. See 42 U.S.C. § 7479(3)

(BACT determination is made by the “permitting

authority”); 30 Tex. Admin. Code Ann. §§ 116.111(a)

(2)(C); 116.114(a); 116.160(c); 116.160(d). Further, a

contested case hearing before the specialized SOAH was

held in which many of the very issues before the Court

were heard. Defendants state that when the permit is

issued, Plaintiffs may sue the TCEQ in state court in

Travis County over that decision. Tex. Gov’t Code Ann.

$§ 2001.171 et seq.

Plaintiffs argue that Burford abstention does not

apply. Plaintiffs assert that their claims arise squarely

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Sla

Appendix B

under federal law, and any state laws and regulations at

issue were enacted pursuant to authority delegated from

the federal government. Plaintiffs also assert that this

case does not involve inquiry into unsettled state law or

local facts—the main dispute in this case is whether

Defendants violated the federal CAA by not providing

certain information and conducting certain analyses in

applying for permits and proposing to construct the Oak

Grove Plant. Plaintiffs further assert that clean air is

not a matter of mere local concern, and any interest in

cohesive local policy is equally served by the federal

court’s exercise of jurisdiction. Lastly, Plaintiffs argue

that there is no special state forum for judicial review

of federal CAA claims. See 42 U.S.C. § 7604(a).

Alternatively, if this Court did have jurisdiction, it

would exercise Burford abstention. While Plaintiffs style

their case as a federal CAA cause of action, the Court

finds that it attacks Defendants’ permit “application”

and is essentially a collateral attack on the Texas

permitting process. The TCEQ has jurisdiction to review

permit applications, not this Court, and if a permit

issues, Plaintiffs would file suit against the TCEQ in

state court.

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52a

Appendix B

IV. CONCLUSION

Having heard the arguments of the parties and

reviewed the Motion, Response, Reply, pleadings, and

applicable legal authority, the Court finds that it lacks

subject matter jurisdiction over Plaintiff’s citizen suit

under sections 304(a)(1) and 304(a)(3). Further, the Court

finds that there is no case or controversy. Alternatively,

the Court finds that if it did have jurisdiction, it would

exercise Burford abstention. Defendant’s Motion To

Dismiss will be granted.

In light of the foregoing, it is

ORDERED that Defendants Oak Grove

Management Company LLC, TXU Power, a D/B/A of

TXU Generation Company LP And TXU Corp.’s Motion

To Dismiss is GRANTED. It is further

ORDERED that any and all motions or requests not

previously ruled upon by this Court are DENIED as

moot.

SIGNED on this 21* day of May, 2007.

s/ Walter S. Smith, Jr.

WALTER S. SMITH, JR.

CHIEF UNITED STATES DISTRICT JUDGE

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