Amicus Brief — Alcan Foil Products Division of Alcan Aluminum Corp. v. United States

Supreme Court, US.

ILE D

No. 89-1104 cee 16 1990

SUPREME COURT OF THE UNITEDSSEAEES—

October Term, 1989

ALCAN FOIL PRODUCTS DIVISION

OF ALCAN ALUMINUM

CORPORATION - - - - - . Petitioner,

versus

UNITED STATES OF AMERICA - ~- _ Respondent.

BRIEF IN SUPPORT OF PETITION FOR WRIT OF

CERTIORARI TO THE UNITED STATES COURT OF

APPEALS FOR THE SIXTH CIRCUIT, ON BEHALF

OF THE CABINET FOR ECONOMIC DEVELOPMENT

OF THE COMMONWEALTH OF KENTUCKY, CITY

OF LOUISVILLE, KENTUCKY CHAMBER OF COM-

MERCE, LOUISVILLE AREA CHAMBER OF COM-

MERCE, ASSOCIATED INDUSTRIES OF KENTUCKY,

THE AFL-CIO, THE ALUMINUM BRICK AND GLASS

WORKERS INTERNATIONAL UNION, LOCAL 130,

THE INTERNATIONAL ASSOCIATION OF MACHIN-

ISTS AND AEROSPACE WORKERS, DISTRICT #27,

LOCAL 681, AND THE INTERNATIONAL BROTHER.

HOOD OF ELECTRICAL WORKERS, LOCAL 369,

AS AMICI CURIAE

DAVID C. BROWN

ROY KIMBERLY SNELL

STITES & HARBISON

600 West Main Street

Louisville, KY 40202

(502) 587-3400

LAURA D. KELLER*

STITES & HARBISON

2300 Lexington Financial Center

Lexington, KY 40507

(606) 254-2300

Attorneys for Amici Curiae

*Counsel of Record

WESTERFIELD-BONTE CO.. 61f W. KENTUCKY—P.O. BOX 3251, LOUISVILLE. KY.

TABLE OF CONTENTS

Interests of the Amici Curiae .....................

Reasons for Granting the Writ ....................

‘.

bo

b

The Alean case dramatically illustrates how

EPA’s delay in reviewing a SIP revision, econeur-

rent with a lawsuit for penalties, deprives the

local agency of its role in air quality control ...

The facts of this case forcefully illustrate how

EPA’s usurpation of the local regulatory author-

ity’s role aggrieves not only the company but its

employees, other businesses, and the community

as a whole, the very publie which Congress in-

tended to have a voice through local regulation

A i ooh coe ae hc Se ee ee

There is a direet conflict among the cireuit courts

which have addressed the issues of this case ..

IE as ce 6 oe cua eae Ge ere beeen

d- 6

il

TABLE OF AUTHORITIES

Cases: PAGE

American Cyanamid Co. v. EPA, S810 ¥. 2d 493 (5th

+ SD. Mn ayy his enle lees See 9, 10

Duquesne Light Co. v. EPA, 698 F. 2d 456 (D.C.

CAR BOONE ike vcentetoeee eee tee 9

(reneral Motors Corporation v. lnited States of

America, No, 89-369, certiorari granted Decem-

oo oot ee 6.8, 11

Tram Ws Natural Ri SOUCE De te WASE Council, 4°] U.S.

CAO RD 6 6.655:3.6 beeen eee 6

Union Electric Co. vy. EPA, 427 U.S. 246 (1976)... 7

United States v. Alean Foil Produc fs, S89 F, 2d 1513

bj GRAMME caryathere ee Ned ny are An UE bd od hoy a)

United States v. General Motors Corp., S76 EF. 2x

fee Tae Ce. BOE? ss eo ee ee 9

Regulations:

Fr Se AED. bon 5050-0 ST eee ee 5

Other Authorities:

od Fed. Reg. 40745 (1988) ....................... 7

Bureau of Economie Analysis, Department of Com-

merce, Regional Input-Output Modeling System

II for Kentucky (1988) ...................... 8

No. 89-1104

IN THE

SUPREME COURT OF THE UNITED STATES

October Term, 1989

Atcan Fon. Proptcts Division or

ALCAN ALUMINUM CORPORATION . . Petitioner,

v.

Unitep States or AMERICA ‘ . . Respondent.

BRIEF IN SUPPORT OF PETITION FOR WRIT OF

CERTIORARI TO THE UNITED STATES COURT OF

APPEALS FOR THE SIXTH CIRCUIT, ON BEHALF

OF THE CABINET FOR ECONOMIC DEVELOPMENT

OF THE COMMONWEALTH OF KENTUCKY, CITY

OF LOUISVILLE, KENTUCKY CHAMBER OF COM-

MERCE, LOUISVILLE AREA CHAMBER OF COM-

MERCE, ASSOCIATED INDUSTRIES OF KENTUCKY,

THE AFL-CIO, THE ALUMINUM BRICK AND GLASS

WORKERS INTERNATIONAL UNION, LOCAL 130,

THE INTERNATIONAL ASSOCIATION OF MACHIN-

ISTS AND AEROSPACE WORKERS, DISTRICT #27,

LOCAL 681, AND THE INTERNATIONAL BROTHER-

HOOD OF ELECTRICAL WORKERS, LOCAL 369,

AS AMICI CURIAE

Amici Curiae submit this memorandum in support of

the Petition for Writ of Certiorari filed by Alcan Foil Prod-

ucts Division of Alean Aluminuin Corporation (Alean’)

on January 17, 1990, seeking review of the decision and

order of the United States Court of Appeals for the Sixth

Cireuit in this ease. Attorneys for all of the parties have

consented to the filing of this brief.

1Consent letters have been filed with the Clerk of the Court.

INTERESTS OF THE AMICI CURIAE

The amici curiae are a group of associations and

agencies representing the interests of business and labor

throughout Kentucky. They share a common objective

of promoting a balance between a healthful environment

and a healthy economy, and believe that both assets can

best be promoted through state exercise of primary author-

ity for air quality control.

The Kentucky Cabinet for Economic Development is

the primary state agency responsible for creating and re-

taining jobs and investment in Kentucky. Programs ad-

ministered by the Cabinet are designed to support and

promote economic development within the state primarily

through attracting new indusiries to Kentucky and assist-

ing in the development and retention of existing industries.

The Louisville Chamber of Commerce represents approxi-

mately 2.500 businesses in the Louisville and Jefferson

County area, employing over 275,000 Kentuckians. As the

largest business association within the community, the

Chamber has « long-standing and continuing interest in the

economic growth and development of the community. The

Kentucky Chamber of Commerce is a broad-based state-

wide association of over 3,400 businesses. It promotes

business interests through legislative lobbying and spon-

sors various programs to develop community leadership,

local economic development, and long-range planning for

the business community of Kentucky. Associated Indus-

tries of Kentucky is a statewide organization of employers

throughout Kentucky in all segments of business. It is

dedicated to a better business, tax, and labor climate and

provides a wide range of services to its members. All

of these associations are directly and daily concerned with

the application of federal laws and standards through the

cooperation of federal, state, and local agencies in such a

way that industries may enjoy consistent and balanced

regulation of their activities. They recognize that a com-

pany ordered by a federal agency to conform to one stand-

ard and by a local agency to conform to another may well

decide that another region of the country would be a better

place to conduct business,

The City of Louisville is interested in this litigation

not only because it wants to ensure that its business en-

tities are fairly dealt with by the Environmental Protee-

tion Agency (HPA), but also becanse the city itself oper-

ates an ineinerator and wishes to avoid being confronted

with the same undesirable choices that face Petitioner

Alean. The city maintains that the local government is

in a far better position than EPA to balance the rights

of the emplovees, industry, and the general publie.

The Kentucky \EL-CTO, the International Brotherhood

of Electrical Workers, Local Union 369, the International

Association of Machinists and Aerospace Workers, District

No. 27, Local 681, and the Aluminum, Brick and Glass

Workers International Union, Local 130, all represent em-

ployees employed by Alcan at its three locations in Louis-

ville, Kentucky. These unions wish to emphasize that the

number of manufacturing jobs in many communities has

dropped dramatically in the Jast two deeades. In Louis-

ville and Jefferson County the number of well paid manu-

facturing jobs has fallen from 190,000 in 1974 to under

80,000 currently. The Jabor unions wish to remind the court

that, while EPA procrastinates its review of local regula-

tion revisions, their members and their families face the

possibility of financial ruin. Many would not be employ-

able shonld Alean be foreed to close its plant.

t

All of the above-described parties have a real and direct

interest im maximizing local participation im the develop-

ment aid application of state implementation plans (SIPs)

concerning air quality. They maintain that the state, not

MPA, is the primary forum for carrying out the give-and-

take rulemaking process of developing an emissions pro-

gram which auswers the needs of the community, local in-

dustry, and the general public. The amici all recognize

that such businesses as Alcan contribute significantly to

the econolie M ell-l. he’ ol Kent UCKY nid elsew ere, through

employvinent, related taxes, aid other value-added compon-

ents, such as secondary ciiployment that serviees these

emplovees and their families. Jobs and local economy are

jeopardized by EP.A‘s refusal io issue timely decisions on

SIP revisions and by the threat of significant litigation

expenses and penaliies borne by companies complying with

the locally-cnforced revisions, validly promulgated under

state and local law. They are concerned that the rule

established by the court below Fails to penalize KPA ade-

quately for its excessive delays in SIP review and encour-

ages EPA to suc companies as a ineaus of pressuring them

to conform to unpromulgated HEPA policies. HPA is thus

encouraged to take similar action with regard to other in-

dustries in the future.

Amici curiae beheve that Alean’s Petition for Certiorari

should be granted because the case would offer this court

a context in which to review the impact of the EPA’s delay

of SIP review, counled with concurrent enforcement actions,

upon these groups, their members, and the Commonwealth

of Kentucky as a whole. The amici have previously demon-

strated their interest in this case by participating as amici

curiae in the court below.

REASONS FOR GRANTING THE WRIT

This ease presents additional aspects of the issues be-

fore the Court in General Motors Corporation v. United

States of America, No. 89-569, certiorari granted December

4, 1989. Review of this case in conjunction with the Gen-

eral Motors case would aid the Court in its consideration

of the various questions involved.

1. The Alcan case dramatically illustrates how EPA’s

delay in reviewing a SIP revision, concurrent with a

lawsuit for penalties, deprives the local agency of its

role in air quality control.

Both General Motors and this case concern a central

issue of nationwide importance: Whether EPA should be

allowed to maintain an enforcement action for civil pen-

alties against a company which is in full compliance with

current state and local air quality regulations, even though

KPA has failed to meet statutorily imposed deadlines for

reviewing those regulations for conformity with federal

standards. By failing to approve or disapprove the pro-

posed SIP, EPA relegated a valid Kentucky regulation

to a state of limbo.

Regulations promulgated pursuant to the Clean Air Act

provide that a SIP revision submitted to the EPA must

have already been adopted by the state in final form. 40

CEFR 51.104(d). At the time of its submission, SIP revision

is effective state law, the law with which the industry must

comply in order to avoid a local enforcement action by the

primary authority. Yet EPA refused to review the SIP

revision and pursued a federal enforeement action against

Alean, even though the state air authority emphatically

and repeatedly maintained that the Alean facility was in

6

full compliance with its law. A valid state regulation was

nullified, not by EPA disapproval, but by EPA inaction.

The Alean case would present a fine context in which this

Court could examine the propriety of the EPA’s usurpation

of state role in air quality regulation in such a fashion.

2. The facts of this case forcefully illustrate how EPA’s

usurpation of the local regulatory authority’s role ag-

grieves not only the company but its employees, other

businesses, and the community as a whole, the very

public which Congress intended to have a voice through

local regulation of air quality.

Amici believe that this case demonstrates, better than

General Motors, that the consequences of allowing EPA

to pursue a company for violation of a state implementa-

‘ion plan which EPA has neglected or refused to approve

or disapprove, often for a pertod of vears, are felt far be-

yond the company boundaries, The consequences to em-

plovees and their families, to surrounding providers of

services aud goods, aud to the community economy have

not been detailed before this Court and likely will not be

in the General Motors case alone.

Congress assigned the primary authority for air quality

regulation to the states, relegating EPA to a secondary

role of oversight to assure that national standards would

be maintained. Train v. Natural Resources Defense Coun-

cu, 421 U.S. 60, 79 (1975). The state regulatory ageney,

far more knowledgeable of local conditions and loeal needs,

far more accessible by the general public, and far more

eapable of flexibility than a national superageney, is in a

better position to apply particular standards to specifie

operations within its own district than is EPA. As recog-

nized by this Court:

~

Perhaps the most important forum for consideration

of claims of ecomonic and technological infeasibility

is before the state agency formulating the implemen-

tation plan. So long as the national standards are

met, the state may select whatever mix of control de-

vices it desires . . . and industries with particular

economie and technological preblems may seek special

treatment in the plan itself.

Union Electric Co. v. KPA, 427 U.S, 246, 266 (1976). Con-

gress thus recognized that the only workable forum in

which local industry and labor such as amici’s members can

receive genuine consideration is the state or local ageney.

Assuming their specific concern can be accommodated with-

out violating national air quality standards, revision of

the SIP is the appropriate response. Tf EPA refuses to

approve or disapprove the new SIP tor years at a time,

however, and continues to enforce the old SIP, PAA under-

cuts the loeal agency's attempts to balance economic and

environmental considerations. The federal vovernment

thus entirely cuts out of the process the state, the individ-

ual source, and persons such as amici’s members,

The Alean ease clearly demonstrates how interested

parties were left out of the process. Alean worked with

the local agency to develop a bubble plan applicable to its

facility, following a hearing at which the general public

had an opportunity to comment. Unable to obtain a de-

cision from EPA from 1982 until 1986 on either of two

SIP revisions, the local agency advised Alcan to work out

its differences with EPA directly. EPA then met only with

Alean. Neither the local authority nor the general public

had the opportunity to participate further, except to com-

ment on the proposed disapproval eventually published in

the Federal Register. 53 Fed. Reg. 40745 (1988). This

8

total abandonment of the concept envisioned by Congress of

a state-federal partnership, this exclusion of the general

public from the decision-making process, makes the Alean

case a compelling one for review of the far-reaching con-

sequences of allowing EPA to “pocket veto” a SIP revision

and yet maintain a suit against the company endorsing te

revision.

Under the circumstances of the Alean ease, if the EPA

is allowed to pursue an enforcement action while holding

a SIP revision hostage, the company i+ foreed to decide

Whether the costs of litigation and threatened penalties,

along with the possibility that it- SIP revision will be re-

jected, dictate closure of a marginal facility. That dilemma

is more clearly illustrated in the Alean case than in Gen-

eral Motors. While General Motors wrestled with the

issue of which of several options might be more econom-

ically feasible, Alean had to decide whether its operation-

should continue in Kentucky at all. Alean’s quandary ha-

been amici’s quandary. The manufacturing jobs at the

Alean plant would be sorely missed, not only by Alean’s em-

ployees, but by other busine-se< and employee= whose liveli-

hood would be jeopardized by the demi-e of Alean.

For a facility such as Alean, engaged in mi-cellaneous

metal work in Kentucky, for every $1,000,000 of the com-

pany’s gross sales lost due to the closing of the plant, the

Department of Commerce would predict a drop of nearly

$600,000 in wages paid to employees in the state. Bureau

of Economie Analysis, Department of Commerce, Regional

Input-Output Modeling System II for Kentucky (198s)

(earnings multiplier). Similarly, for every such $1,000,000

decrease in sales, a decrease of over thirty jobs would be

expected in the state. Jd. (employment multiplier). Ken-

9

tucky and amici’s members can ill afford such damage to

their economy.

3. There is a direct conflict among the circuit courts which

have addressed the issues of this case.

Four circuit courts have examined issues pertinent to

this case. United States v. Alcan Foil Products, 889 F. 2d

1515 (6th Cir. 1989) ; Vuited States v. General Motors Corp.,

S76 F. 2d 1060 (1st Cir. 1989); American Cyanamid Co. v.

EPA,S10 F.2d 495 (Sth Cir. 1957); and Duquesne Light Co.

v. EPA, 69S F.2d 456 (D.C. Cir. 1923). The Sixth Cireuit

attempted to fashion a middle ground which it believed

would provide an incentive for EPA to review SIP revi-

sions expeditiously but would also protect the general pub-

lic. Its solution was to allow EPA to maintain its enforce-

ment action even as it held the SIP revision hostage, but

to allow the trial court to adjust the penalty by balancing

the reasonableness of EPA‘. delay against any prejudice

to the source, so long as the source can show that it is in

compliance with the revised SIP.

While the Sixth Circuit's attempt to balance the equities

is admirable, it misses the mark. First, the court assumed

that the “public” would be best -erved by allowing EPA to

maintain an enforcement action before deciding on the SIP

revision. Amici, members of the public, believe that SIP

revisions which are plainly unsound from an environmental

standpoint can be expeditiously rejected. If the revision

is so inoffensive that it takes EPA more than two years

of policy development to find a reason to reject it, as hap-

pened in the Alean matter, little is to be gained by a rush

to enforce the old SIP when the source is complying with

the new SIP. EPA needs incentive to decide its general

10

policy before attacking an individual facility for violation

of what may become policy someday.

Second, amici assert that, even if it is aware of the

possibility that penalties will be reduced due to equitable

considerations, a marginal industrial facility may ration-

ally decide that the gamble is just too great and that the

costs of litigation may be too much to bear. If the industry

chooses to shut down its operations or to move them, it-

employees, surrounding providers, and the community as

a Whole pay the price. Other industries face the spectre

of similar treatment should they attempt to coniply with

revised SIPs duly promulgated under sinite and local law

but not vet approved by EPA. Amici submit that a fairer.

more objective approach wo ikd be to follow the holding ot

the Fifth Cireuit in cliverican Cyauainid, S10 F.2d at

O1, That is, EPA should be prohibited from commencing

enforcement proceedings until it rejects a proposed revision.

11

CONCLUSION

Amici submit that a review of this case in conjunction

with General Motors will provide this Court with a greater

understanding of the potential consequences of allowing

EPA to maintain an action for penalties against a company

complying with a validly promulgated SIP revision which

PA fails to review as required by law. For the reasons

stated, amici respectfully pray that Alean’s petition for a

writ of certiorari be granted.

Respectfully submitted,

Davip C. Brown

Roy Kimperty SNELL

Stites & Harpison

600 West Main Street

Louisville, KY 40202

(502) 587-3400

Lavea D. KELLER’

Stites & I[arsison

2500 Lexington Financial Center

Lexington, KY 40507

(606) 254-2300

Attorneys for Amici Curiae

‘Counsel of Record