Petition for Writ of Certiorari — American Lung Ass'n v. Environmental Protection Agency

(, ? ®upreme Court, u.s.

| FILED

881929 NUN; 1999

Ont ie THE oF QK

In The

Supreme Court of the United States

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AMERICAN LUNG ASSOCIATION, et al.,

Petitioners,

ENVIRONMENTAL PROTECTION AGENCY

and Carol M. Browner, Administrator,

United States Environmental Protection

Agency, Appalachian Power Company, et al.,

Respondents.

+

On Petition For A Writ Of Certiorari

To The United States Court Of Appeals

District of Columbia Circuit

¢

PETITION FOR A WRIT OF CERTIORARI

7

Rosert E. YUHNKE

Counsel of Record

Attorney for Petitioners

1405 Arapahoe Avenue

Boulder, CO 80302

(303) 440-4901

COCKLE LAW BRIEF PRINTING CO., (800) 225-6964

OR CALL COLLECT (402) 342-2831

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QUESTIONS PRESENTED FOR REVIEW

1. Are citizen petitioners in the Court of Appeals

whose petition for review of a final agency action is

granted, and where the agency action is remanded for

further proceedings on the ground that the agency failed

to satisfy basic standards for reasoned decision making,

eligible for an award of attorneys’ fees and other costs of

litigation under statutory fee shifting provisions such as

§ 307(f) of the Clean Air Act?

2. Have petitioners who win a judicial decision

remanding a final agency action to the agency for further

proceedings to remedy a failure to establish a nexus

between the facts found and the decision made achieved

“some success” qualifying for an award of fees and costs,

and not a “purely procedural” victory within the excep-

tion for fee awards established by this Court in

Ruckelshaus v. Sierra Club, 463 U.S. 680, at 688, n.9?

LIST OF PARTIES BELOW

The decision of the Court of Appeals sought to be

reviewed is the order denying Petitioners’ motion (below)

for determination of eligibility for an award of costs of

litigation including reasonable attorneys’ fees pursuant to

§ 307(f) of the Clean Air Act, 42 U.S.C. § 7607(f). The only

parties participating in that motion were Petitioners (here

and below) and the United States Environmental Protec-

tion Agency (“EPA”). Industry parties who intervened

below as respondents in the proceedings on the merits of

EPA’s decision were not parties to the fee motion because

they are not liable for payment of fees to Petitioners

under § 307(f).

Petitroner-parties below are: American Lung Associa-

tion, Paul J. Walters, Herbert Raymend Woodruff, Envi-

ronmental Defense Fund, and petitioner-intervenors

Carol Ramey on behalf of herself and her asthmatic minor

son David Ramey. None of these parties have parent

companies or subsidiaries. Respondent below is United

States Environmental Protection Agency.

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TABLE OF CONTENTS

Page

QUESTIONS PRESENTED FOR REVIEW ........... j

LIST OF PARTIES BELOW...............-.. 200005. i

CITATIONS OF OPINIONS AND ORDERS......... 1

BASIS FOR JURISDICTION ..............-0.-0000. 1

GOVERNING STATUTORY PROVISION............ 1

STATEMENT OF THE CASE...............-.0 0000. 2

Summary of Proceedings Below................ 2

REASONS FOR ALLOWING WRIT ................ 6

1. DENIAL OF FEES UNDERMINES CONGRESS’

PURPOSE IN AUTHORIZING FEES............ 8

2. CONFLICTS WITH DECISIONS OF THE

SUPREME COURT..............-0. 20. ceeceeee, 10

3. CONFLICTS WITH DECISIONS OF THE

COURTS OF APPEALS ...............-0ee0005. 19

4. SHOWINGS REQUIRED FOR FEE APPLICA-

TION OPEN A PANDORA'S BOX.............. 23

iV

TABLE OF AUTHORITIES

Page

Cases

ALA v. EPA, 1364 PSG FUG CIGFE) oo ccc ccvccsccnrs passim

Burlington Truck Lines v. United States, 371 U.S. 156

CR tkr cect seceeeeceenes suubeas orp eenr rays ee 15

Chemical Manufacturers Association v. U.S. EPA, 885

e Br 8. Ee B Mereererrrye errr eee 20, 22

Conservation Law Foundation of New England v. Sec-

retary of Interior, 790 F.2d 965 (1st Cir. 1986) ...... 17

James Madison Ltd., by Hecht v. Ludwig, 82 F.3d 1085

es Gk. SE i ncbvdcstetcuvereuseecstinetanssee 16

Motor Vehicle Mnfrs. Ass'n v. State Farm Mut. Auto.

is SEP UE. SF Cee sv exccisivissccrstice 4, 15, 16

National Coalition Against Misuse of Pesticides v.

Thomas, 815 F.2d 1579 (D.C. Cir. 1987) ......... 17, 18

National Wildlife Federation v. Hanson, 859 F.2d 313

eee eee ee eee 19, 20, 22

Ober v. U.S. Environmental Protection | May 84

PO De Ge GO, FH a coves en ccS ceewisrvnsci 20, 21

Ruckelshaus v. Sierra Club, 463 U.S. 680 (1983) ... passim

Rueda-Menicucct v. Immigration and Naturalization

Service, 132 F.3d 493 (9th Cir. 1997)............... 18

SEC v. Chenery Corp., 332 U.S. 194 (1947)............ 15

Shalala v. Schaefer, 509 U.S. 292 (1993)........... passim

Sierra Club v. EPA, 769 F.2d 796 (D.C. Cir. 1985). .14, 21

Sullivan v. Hudson, 490 U.S. 877 (1989).............. 11

Vv

TABLE OF AUTHORITIES - Continued

Page

Texas State Teachers Assn. v. Garland Independent

School District, 489 U.S. 782 (1989)......... 12, 13, 17

Vermont Yankee Nuclear Power Corp. v. N.R.D.C.,

ek Rt PPT errr rererrrrrrr errr rr re 15

Waterman Steamship Corp. v. Maritime Subsidy

Board, 901 F.2d 1119 (D.C. Cir. 1990)........... 17, 18

STATUTES

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61 Pod. Rew, 25,566 (1996) 6 occ cccccvcceccscsccceecves 2

is, 2 w. « PrererrrTirrrirriry tt te 3

Gi Fed. Ram. FOG oes cc cccececescstcnivusecsensseves 3

63 Fed. Reg. 24,782 (May 5, 1998) cAdaneneeenne vee 4, 13

H.R. Rep. 294, 95th Cong., 1st Sess. 337 (1977)..... 8,9

U.S. Code Cong. & Ad. News 1416 (1977)............ 9

RuLes

OSD. Sep. Co. Take Fs vi ccsccecisvcscunenvecsestaies 1

CITATIONS OF OPINIONS AND ORDERS

The December 31, 1998 order of the Court of Appeals

denying Petitioners’ eligibility for an award of costs and

attorneys’ fees is not published. The underlying decision

remanding EPA’s decision not to revise the National

Ambient Air Quality Standards for sulfur oxides is pub-

lished at 134 F.3d 388, 45 ERC 2025, 328 U.S. App. D.C.

232, 28 Envtl. L. Rep. 20,481.

e

BASIS FOR JURISDICTION

i. The Court of Appeals’ order denying Petiitoners’

Motion for Determination of Eligibility for Award of

Attorneys’ Fees was entered December 31, 1998.

ii. The Court of Appeals denied a timely petition for

rehearing on March 3, 1999.

iii. This petition is filed 90 days following denial of

rehearing under U.S. Sup. Ct. Rule 13 and 28 U.S.C.

§ 1254.

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GOVERNING STATUTORY PROVISION

Clean Air Act Section 307(f), 42 U.S.C. § 7607(f):

Costs

In any judicial proceeding under this section, the

court may award costs of litigation (including reasonable

attorney and expert witness fees) whenever it determines

that such award is appropriate.

*

——,

STATEMENT OF THE CASE

Summary of Proceedings Below

In the proceedings before the Court of Appeals, the

American Lung Association, two of its members with a

history of severe asthmatic reactions when exposed to

sulfur dioxide emissions in the ambient air, the Environ-

mental Defense Fund and intervenors Carol Ramey on

behalf of her severely asthmatic son David (“ALA”) peti-

tioned the U.S. Court of Appeals for the District of

Columbia Circuit for review of the decision by the United

States Environmental Protection Agency (“EPA”) not to

revise the National Ambient Air Quality Standards

(“NAAQS”) for sulfur dioxide (“SO2”) under § 109 of the

Clean Air Act (“CAA”).! 61 Fed. Reg. 25,566 (1996). ALA

argued that EPA had unlawfully failed to satisfy the

statutory command in § 109(b)(1) to establish standards

that “allow[ ] an adequate margin of safety [and] are

requisite to protect the public health”, because EPA failed

to revise the 1971 NAAQS as required by § 109(d) to

prevent 5-minute peak SO2 exposures known to cause

adverse health effects documented since the NAAQS was

promulgated.

Those effects were acknowledged by EPA in its crite-

ria document required by § 108(a)(2) to be “severe and

incapacitating” for half or more of asthmatics exposed to

peak concentrations 2 0.60 parts per million (“ppm”) SO2.

1 Decisions by EPA regarding the NAAQS and other

regulations of national application under the CAA may only be

reviewed within the exclusive jurisdiction of the Court of

Appeals for the D.C. Circuit. 42 U.S.C. § 7607(b)(1)

In its final decision, EPA concluded that “repeated occur-

rences of such effects should be regarded as significant

from a public health standpoint.” Final Decision at

25,573. EPA also found “the data clearly show that 5-min-

ute peaks greater than 0.60 ppm SO2 can occur around

particular industrial point sources of SO2,” and “the

5-minute monitoring data indicate that some commu-

nities in proximity to SO2 sources are repeatedly sub-

jected to high short-term concentrations of SO2 in the

ambient air.” 61 Fed. Reg. 25,575. For asthmatics living in

areas where the likelihood of frequent exposures is high,

EPA “concluded that repeated exposures to 5-minute

peak SO2 levels of 0.60 ppm and above could pose a risk

of significant health effects for asthmatic individuals.” Id.

25,573. Despite its finding of significant health risk to

individuals, and that frequent occurrence of such effects

are significant from a public health standpoint, EPA

declined to set NAAQS adequate to prevent these

adverse health effects.

In its review of EPA’s decision, the Court granted

ALA’s petition for review and remanded to EPA its deci-

sion not to revise the NAAQS for SO2. ALA v. EPA, 134

F.3d 388 (1998). The Court based its decision on the

Administrator’s failure

to explain the answer she did give, i.e., that SO2

bursts do not amount to a “public health” prob-

lem within the meaning of the Act. The link

between this conclusion and the factual record

as interpreted by EPA - that “repeated” expo-

sure is “significant” and that thousands of asth-

matics are exposed more than once per year — is

missing. Why is the fact that thousands of asth-

matics can be expected to suffer atypical physical

effects from repeated five-minute bursts of high-

level sulfur dioxide not a public health problem?

Why are from 180,000 to 395,000 annual “expo-

sure events” ... so “infrequent” as to warrant no

regulatory action? Why are disruptions of ongo-

ing activities, use of medication, and hospitaliza-

tion not “adverse health effects” for asthmatics?

Answers to these questions appear nowhere in

the administrative record.

ALA v. EPA, at 392. Citing Motor Vehicle Mnfrs. Ass’n v.

State Farm Mut. Auto. Ins., 463 U.S. 29, 48 (1983), the

Court held the Administrator to the obligation to

“cogently explain why [she] has exercised [her] discretion

in a given manner.” ALA, at 392. Given the gaps the Court

identified in EPA’s reasoning with regard to the “critical

task of assessing the public health and the power to make

decisions of national import in which individuals’ lives

and welfare hang in the balance,” the Agency failed to

meet its “heaviest of obligations to explain and expose

every step of its reasoning.” Id. In view of EPA’s failure to

provide an explanation that established a nexus between

the facts found and the final decision, the Court con-

cluded “we must remand this case to permit the Adminis-

trator to explain her conclusions more fully.” Id. 393.

In addition to relief granted by the Court, ALA obtained

further relief by negotiating a Settlement Agreement with

EPA in lieu of a petition for rehearing which commits the

Agency to conduct proceedings on remand as a notice and

comment rulemaking, and to make a final decision no later

than 2000. 63 Fed. Reg. 24,782 (May 5, 1998).

Ne

After final execution of the Settlement Agreement

which expressly preserved ALA’s right to apply for attor-

neys’ fees pursuant to § 307(f) of the Act, the government

informed ALA that it would oppose any payment of costs

of litigation, including reasonable attorney’s fees, on the

ground ALA was not a prevailing pa.ty. ALA then filed a

Motion for Determination of Eligibility for Award of Liti-

gation Costs. The Motion relied upon decisions by this

Court holding that a remand of agency action by a court

of appeals establishes “prevailing party” status for the

victor, and that under § 307(f) of the CAA prevailing

party status is not required for an award of attorneys’

fees. The Motion also relied on decisions in four other

circuits where attorneys’ fees had been awarded under

similar statutory provisions in cases involving a remand

of agency action that did not prescribe specific substan-

tive relief in favor of the citizen parties.

After briefing, the Court denied ALA’s motion hold-

ing that

[t]his request for fees is controlled by Sierra Club

v. EPA, 769 F.2d 796 (D.C. Cir. 1985). As in that

case, petitioners here did not meet with “a mod-

icum of success on the merits,” because “[t]he

agency may be able to justify its position with a

simple response containing no reformulation of

the challenged portion of the rules. Id. at 806.

Order at 2 (December 31, 1998).

Petitioners filed a timely Petition for Rehearing and

Suggestion of Rehearing en Banc which was denied on

March 3, 1999.

REASONS FOR ALLOWING WRIT

The decision of the Court of Appeals that an award

of costs of litigation in this case is not “appropriate”

within the meaning of CAA § 307(f) should be reviewed

by this Court to resolve conflicts with prior decisions of

this Court and conflicts with at least four other United

States courts of appeals that have addressed the same

question. In addition to resolving conflicts, the decision

should be reviewed because of the extraordinarily impor-

tant role the D.C. Circuit Court of Appeals plays in the

supervision of agency implementation of the nation’s

environmental protection programs.

The decision of the D.C. Circuit court of appeals that

Petitioners are not eligible for fees and costs in cases

where the petition for review is granted but a remand is

the primary relief, is especially important in cases such as

this which involve review of agency decisions that imple-

ment the broad, guiding policies of the environmental

statutes. In these cases, the reviewing court is usually

constrained by its supervisory role not to prescribe the

policies for statutory implementation, and instead must

limit its intervention to ensuring that agencies perform

reasoned decision-making. Under these constraints, the

Court will often limit relief to remanding an agency deci-

sion for further consideration. This is especially true in

cases such as this where the citizen challenge is to agency

inaction. When courts review agency decisions not to act,

there is no action to be vacated or reversed. The decision

at issue here begins to define a class of cases in which

challengers to agency inaction may win all there is to

win, but still not qualify for an award of fees and costs.

Given its role as the only court in the nation with

jurisdiction to review EPA final actions “of nationwide

scope or effect” under § 307(b)(1) of the Clean Air Act, 42

U.S.C. § 7607(b)(1), the rule adopted in this case will

significantly limit the reliance that adversely affected seg-

ments of the public may place on the fee-shifting provi-

sion that plays a major role in ensuring that agency

decisions not to implement congressional policies are

subject to effective judicial review. As a practical matter,

the Court’s decision in this case could strip the Act of its

fee-shifting provision for a significant class of cases that

involve the most important decisions governing the

implementation and administration of the CAA.

Proceedings to review most, if not all, of the major

decisions by EPA to implement the CAA - decisions such

as review and promulgation of national ambient air qual-

ity standards under § 109(b), national emission standards

for hazardous air pollutants under § 112(d), new source

performance standards under § 111(a), emission stan-

dards for autos, trucks, buses, railroad locomotives and

air plane engines under Title II, regulations governing

implementation of the national acid rain program under

Title IV, and criteria and procedures governing the air

quality review and approval of metropolitan transporta-

tion plans and programs under § 176(c) - will be gov-

erned exclusively by the fee eligibility rule adopted by

the D.C. Circuit unless that rule is modified by this Court.

Had petitioners anticipated the D.C. Circuit’s rule, it

would likely have precluded the commencement of this

case. ALA has no staff counsel employed to pursue these

kinds of cases. ALA and the individual petitioners, as

well as EDF, relied in this case upon counsel with 25

years of experience in Clean Air Act litigation who was

willing to pursue this matter on a contingency fee

arrangement. Counsel was willing to invest many months

effort in this case because of the expectation of a fee

award in the event some success were obtained. If the

D.C. Circuit rule is allowed to govern future cases, many

such cases will not be brought and the congressional

purpose of allowing fees “whenever . . . appropriate will

be defeated.

1. DENIAL OF FEES UNDERMINES CONGRESS’

PURPOSE IN AUTHORIZING FEES.

The denial of attorneys’ fees and costs of litigation in

cases such as this would defeat the policy choice Con-

gress made in adding authority for courts of appeals to

award fees “whenever . . . appropriate.”2 Congress

explained its intent to authorize fees in agency review

cases “to encourage litigation which will assure proper

implementation and administration of the act or other-

wise serve the public interest. The committee did not

intend that the court’s discretion to award fees under this

provision should be restricted to cases in which the party

seeking fees was the ‘prevailing party’.” H.R. Rep. 294,

2 A number of fee-shifting provisions of federal statutes

authorize awards of attorneys’ fees in terms identical to § 307(f).

See Ruckelshaus v. Sierra Club, 463 U.S. 680, 682, n. 1 (1983). Some

of these parallel fee provisions also apply to statutes which,

similar to the CAA, grant exclusive jurisdiction for the review of

EPA actions to the D.C. Circuit court of appeals. See, e.g., the

Resource Conservation and Recovery Act, 42 U.S.C.

§ 6976(a)(1); Comprehensive Environmental Response,

Compensation and Liability Act, 42 U.S.C. § 9613(a).

95th Cong., 1st Sess. 337 (1977), U.S. Code Cong. & Ad.

News 1416 (1977).

Here petitioners obtained a remand of EPA’s decision

not to adopt national ambient air quality standards that

would protect asthmatics from bursts of SO2 that cause

health effects EPA described as “severe and incapacitat-

ing.” The Court based its decision on the Administrator’s

failure to explain the link between her conclusion “that

SO2 bursts do not amount to a ‘public health’ problem

within the meaning of the Act” and her findings “that

‘repeated’ exposure is ‘significant’ and that thousands of

asthmatics are exposed more than once a year... .” ALA,

392. By failing to explain why “the fact that thousands of

asthmatics can be expected to suffer atypical physical

effects from repeated five-minute bursts of high-level

sulfur dioxide [is] not a public health problem,” the Court

concluded that “the Administrator cannot fulfill her

responsibility under the Clean Air Act to establish

NAAQS ‘requisite to protect the public health... .’” Id.

ALA won from the Court an order requiring EPA on

remand to carry out its “critical task of assessing the

public health and [exercising] the power to make deci-

sions of national import in which individuals’ lives and

welfare hang in the balance” by meeting its “heaviest of

obligations to explain and expose every step of its reason-

ing.” Id. By achieving this result, ALA fulfilled the pur-

pose Congress intended to “encourage” by enacting

authority to award fees, i.e., “litigation which will assure

proper implementation and administration of the act or

otherwise serve the public interest.” H.R. Rep., supra. The

litany of critical questions recited by the Court of Appeals

that EPA left unanswered in this rulemaking is the best

10

evidence that the Act has not been properly administered

and that the public health protection goals of the Act

have not been properly implemented. Denying fees to

parties who shoulder the burden Congress invited them

to undertake, and who thereby achieve a remand requir-

ing EPA to properly perform its critical decision-making

task, defeats the purpose underlying section 307(f) and its

counterpart in many other federal statutes. Since ALA

has served the public interest by ensuring that EPA will

faithfully carry out its obligations to properly implement

the Act, it has satisfied the criteria identified by Congress

for an award of fees and litigation costs.

2. CONFLICTS WITH DECISIONS OF THE

SUPREME COURT.

The decision to deny fees in this case is in conflict

with two decisions of the Supreme Court: 1) Ruckelshaus

v. Sierra Club, 463 U.S. 680, 688 (1983), where the Court

concluded that “[s]ection 307(f) was meant to expand the

class of parties eligible for fee awards from prevailing

parties to partially prevailing parties — parties achieving

some success, even if not major success”; and 2) Shalala v.

Schaefer, 509 U.S. 292, 301 (1993), where the Court held

that a party who obtains a court order remanding an

agency decision, even though the order does not require

the agency to reach a particular result on remand, “is a

prevailing party” and therefore qualifies for an award of

attorneys’ fees under a statute that requires prevailing

party status as a predicate for an award of fees. Since this

Supreme Court precedent establishes that winning a

remand qualifies ALA as a prevailing party, a fortiori, fees

11

should be awarded under the less demanding “when-

ever ... appropriate” test of § 307(f).

Fundamentally, the Court of Appeals’ decision is at

odds with, and fails to consider, the Supreme Court's

decision in Shalala, that a judicial remand of an agency

decision qualifies the petitioner as a “prevailing party.”

Id. There the Court clarified potentially conflicting prece-

dents and held that a party who obtains an order remand-

ing an agency decision “is a prevailing party.” Id. 301. In

Shalala, the Court rejected the argument that

a Social Security claimant does not ‘prevail’

until he is awarded Social Security benefits. The

premise of this argument is wrong. No holding

of this Court has ever denied prevailing party

status (under [EAJA]) to a plaintiff who won a

remand order pursuant to sentence four of

§ 405(g).

Id. at 300. The Court expressly rejected dicta in Sullivan v.

Hudson, 490 U.S. 877 (1989) “that remand does not gener-

ally confer prevailing party status... .” Id. 301. The

Court explained that Hudson “simply failed to recognize

the distinction between a sentence-four remand, which

terminates the litigation with victory for the plaintiff, and

a sentence-six remand, which does not.” Id. at 301. The

distinction missed in Hudson is that sentence six of 42

U.S.C. § 405(g) applies only to a ” ‘narrow class of quali-

fying administrative proceedings’ where ‘the district

court retains jurisdiction of the civil action’ pending the

completion of the administrative proceedings.” Id. In con-

trast, sentence-four applies where the court enters a final

judgment “without retention of jurisdiction,” with or

without remand to the agency. 509 U.S. at 297, 299.

12

In ALA, the Court of Appeals’ order “remand[ed] this

case to the agency for further proceedings consistent with

this opinion.” ALA, at 393. “If the case is remanded, this

court does not retain jurisdiction. ... ” D.C. Circuit Rule

41(b). Thus the Court’s decision on the merits, as does a

sentence-four order in a Social Security case, “ ‘termi-

nate[ed] the civil action’ seeking judicial review of the

[agency’s] final decision.” 509 U.S. at 299. Accordingly,

the final order with remand to EPA also “terminates the

litigation with victory for the plaintiff.” Shalala at 301.

Applying Shalala here, Petitioners are prevailing parties.

The Court’s holding in Shalala relied substantially on

Texas State Teachers Assn. v. Garland Independent School

District, 489 U.S. 782 (1989) which held “that [prevailing

party] status [is] obtained ‘if the plaintiff has succeeded

on any significant issue in litigation which achieve[d]

some of the benefit . . . sought in bringing suit.’ Id. at

791-792. ...” Here, ALA succeeded in winning a decision

from the Court that rejected EPA’s decision as not meet-

ing the basic tests for reasoned decision-making. As a

result, ALA achieved some of the benefit sought in bring-

ing suit by preventing prejudice to the health protection |

interests of asthmatics that would have occurred had |

EPA’s decision become settled agency precedent. Requir-

ing EPA to undertake further proceedings it would not

otherwise have been required to conduct to determine

whether asthmatics qualify for protection from short

bursts of SO2 under the CAA clearly promotes the inter-

ests ALA sought to protect. In addition, based on this

ruling, ALA obtained further relief from EPA in a Settle-

ment Agreement which provides for notice and comment

rulemaking procedures and a schedule ensuring a final

EN aT NE Te

13

decision no later than December 2000. 63 Fed. Reg. 24,782

(May 5, 1998).

The Court of Appeals offered no rationale for not

applying Shalala and Garland under the facts of this case.

The Court of Appeals’ decision also effectively

reverses this Court’s decision in Ruckelshaus by denying

fees even when a petitioner achieves some of the relief

sought in bringing suit. This Court determined that Con-

gress’ use of “whenever . . . appropriate” as the test for

an award of fees was “intended to eliminate both the

restrictive readings of ‘prevailing party’ adopted in some

of the cases cited above and the necessity for case-by-case

scrutiny by federal courts into whether plaintiffs pre-

vailed ‘essentially’ on ‘central issues.’ ” 463 U.S. at 688.

“[P]arties achieving some success, even if not major suc-

cess” are eligible for a fee award under Ruckelshaus.

Cases rejected by this Court as requiring a too strin-

gent “prevailing party” test for purposes of § 307(f)

would have awarded fees to litigants who on one theory

or “central issue” of the suit challenged EPA’s decision as

not based on rational decision-making. The test applied

by the Court of Appeals, however, would go well beyond

the cases the Supreme Court saw as too restrictive under

§ 307(f) by measuring success in terms of speculation

about the agency’s hypothetical response on remand

rather than success based on what petitioners sought to

achieve by bringing suit, or by the relief obtained. The

test applied to ALA would bar fees for a claim that would

have satisfied traditional prevailing party tests and is

clearly not consistent with Congress’ intent to lower the

14

fee threshold for litigation that promotes the “proper

implementation and administration of the Act.”

The Court of Appeals’ reliance on its prior decision

in Sierra Club v. EPA, 769 F.2d 796 (D.C. Cir. 1985), as |

controlling, rather than on the precedents of this Court in

Shalala and Ruckelshaus, is the root of the error in this

case. The panel’s decision inappropriately relies on the

single rule provision remanded to EPA in Sierra Club for

which fees were denied rather than relying on the five

rule provisions remanded to EPA in that case for which

fees were granted. In Sierra Club, fees were denied only

for one of the remanded rule provisions because, as to

that one issue, EPA had not offered any rationale for its

position in response to public comments. The Sierra Club

court identified the key factor that distinguished that

claim from the five other claims resulting in remands for

which fees were “appropriate,” i.e., that the “current

situation falls into the category of a ‘purely procedural’

victory, since we have not found wanting any action of

the agency but merely instructed the agency to provide

us with its rationale.” Id. at 806. The Court reviewed and

rejected the Sierra Club’s primary objection to that rule

provision on the merits. The only basis for remand was

that the Court could not review one aspect of the rule

provision in the absence of a response to the issue from

EPA during the rulemaking. Accordingly, it held that a

remand for the sole purpose of obtaining EPA’s initial

response to the issue was “purely procedural” within the

exception established by this Court in Ruckelshaus, 463

U.S. at 688, n.9. Sierra Club, 769 F.2d at 806.

The situation in Sierra Club is in marked contrast to

EPA’s SO2 decision where EPA fully responded to ALA’s

15

rulemaking comments and the Court reviewed the

agency's decision on the merits of the rationale offered by

EPA. The Court clearly found it could not sustain EPA’s

decision because the Administrator failed to establish a

logical connection between her finding of health effects

caused by SO2 bursts, i.e., that ” ‘repeated occurrences of

such effects should be regarded as significant from a

public health standpoint’,” ALA, 391, and her final deci-

sion not to issue NAAQS that protect against such health

effects. “The link between this conclusion and the factual

record as interpreted by EPA - that ‘repeated’ exposure is

‘significant’ and that thousands of asthmatics are exposed

more than once a year - is missing.” ALA, 392. Citing

Vermont Yankee Nuclear Power Corp. v. N.R.D.C., 435 U.S.

519 (1978), SEC v. Chenery Corp., 332 U.S. 194 (1947), and

Motor Vehicle Mnfrs. Ass'n v. State Farm Mut. Auto. Ins.,

463 U.S. 29 (1983), the Court concluded that “[wlithout

answers to these questions, the Administrator cannot ful-

fill her responsibility under the Clean Air Act to establish

NAAQS ‘requisite to protect the public health,’ 42 U.S.C.

§ 7409(b)(1), nor can we review her decision.” ALA, 392.

The Court rejected EPA’s Final Decision on the sub-

stantive conclusions offered by EPA, not on a mere pro-

cedural omission grounded in agency silence. The Court

found EPA’s decision deficient under the most basic test

of agency decision-making, i.e., the failure to “articulate a

satisfactory explanation for its action including a ‘rational

connection between the facts found and the choice

made.’” Motor Vehicle Mnfrs., at 43, citing Burlington

Truck Lines v. United States, 371 US. 156, 168 (1962).

Where “the agency has failed to offer the rational connec-

tion between facts and judgment,” its decision fails to

16

“pass muster under the arbitrary and capricious stan-

dard.” Motor Vehicle Mnfrs., at 56. Indeed, as the Court of

Appeals recently held, a judicial ruling that an agency

has committed a “clear error of judgment,” which neces-

sarily includes a decision for which the agency failed to

offer an adequate explanation, is “substantive,” and not

purely procedural. James Madison Ltd., by Hecht v. Ludwig,

82 F.3d 1085, 1098 (D.C. Cir. 1996).

Rejecting EPA’s decision on the grounds identified in

Motor Vehicle Mnfrs., as the Court did, is clearly a decision

on grounds this Court has characterized as arbitrary and

capricious. The CAA treats arbitrary and capricious

Agency actions as substantive grounds for relief under

§ 307(d)(9)(A), compared with procedural flaws in

Agency decisions under § 307(d)(9)(D) that may only be

remedied by a reviewing Court if “there is a substantial

likelihood that the rule would have been significantly

changed if such errors had not been made.” § 307(d)(8).

To the extent Congress treats the kind of flaw that invali-

dated EPA’s SO2 decision as substantive under the Act, it

should not be treated as a “purely procedural” victory for

purposes of construing the scope of this Court’s excep-

tion for an award of costs and fees under § 307(f).

Ruckelshaus, 688, n.9.

Petitioners’ success in winning an order rejecting

EPA’s Final Decision on this ground represents “some

success” which is all this Court requires for eligibility

under § 307(f). The fact that the Court of Appeals in ALA

declined to reach a number of ther merits arguments

raised by ALA, and granted only a portion of the relief

17

requested, is also not a bar to fees under the “when-

ever ... appropriate” test. See Conservation Law Founda-

tion of New England v. Secretary of Interior, 790 F.2d 965 (1st

Cir. 1986) where the Court granted fees in a case mooted

by the Interior Department's failure to receive any bids

for the offered OCS oil leases after a preliminary injunc-

tion issued but before a determination on the merits in

““[S]ome success, even if not major success,’ may be

taken as notable progress, short of full achievement, on

any issue of substance.” Id. at 967. Where Petitioners

achieved part of the purpose for bringing suit, to wit, a

remand that requires EPA to reconsider the public health

consequences of its initial decision not to extend protec-

tion to asthmatics under the Act, and promoted proper

implementation of the Act, they should be eligible for

fees and costs under both Ruckelshaus and Garland.

Furthermore, a remand on the substance of EPA's

decision — or indeed, even on procedural grounds - is all

that is required for an award of fees under Shalala, supra.

The implication of the Court of Appeals’ denial of

fees is that the successful remand of agency action that is

arbitrary and capricious because it fails to explain the

basis for the choice made - perhaps the most basic

requirement of administrative law —- can never qualify for

an award of attorneys’ fees under the CAA. While this

view may have provided the rationale for D.C. Circuit

holdings in cases governed by statutes requiring prevail-

ing party status for an award of fees, e.g., Waterman

Steamship Corp. v. Maritime Subsidy Board, 901 F.2d 1119

(D.C. Cir. 1990) and National Coalition Against Misuse of

Pesticides v. Thomas, 815 F.2d 1579 (D.C. Cir. 1987), this

rationale has not been adopted by this Court or other

18

circuit courts in cases under statutes authorizing fees

“whenever . . . appropriate.”* On the contrary, judicial

determinations that agencies have failed to properly per-

form their responsibility for reasoned decision-making

have provided a recognized ground for awards of attor-

neys’ fees under such statutes.

Even under statutes requiring “prevailing party” sta-

tus for an award of fees, at least one court of appeals has

now applied this Court’s decision in Shalala as requiring

an award of fees in remand cases. This Court’s re-analysis

of prior “prevailing party” cases in Shalala convinced the

Ninth Circuit that it should reconsider its prior holdings

that a remand without granting some additional “benefit”

to petitioners fails to establish “prevailing party” status.

The Ninth Circuit recently held that Shalala v. Schaefer

required it to reverse prior holdings that fees are not

available to parties who win remands without more.

Rueda-Menicucci v. Immigration and Naturalization Service,

132 F.3d 493, 495 (9th Cir. 1997):

Although Schaefer was a Social Security case, we

can perceive no difference between a “sentence

four” remand under § 405(g) and a remand to

BIA for further proceedings. In both cases, the

remand terminates judicial proceedings and

results in the entry of a final judgment. We

conclude that Schaefer effectively overrules our

holdings in Escobar Ruiz and Beltran-Zavala that

the entry of judgment remanding a case to the

3 Even as to “prevailing party” fee-shifting provisions, the

rationale enunciated in Waterman Steamship and National

Coalition has been superseded by Shalala.

19

BIA for further consideration does not consti-

tute a final judgment in favor of the petitioner.

Because petitioners obtained such a remand,

they are prevailing parties under Schaefer and,

thus, entitled to attorney’s fees... .

In addition to being in conflict with this Court’s teaching

in Shalala v. Schaefer, the D.C. Circuit’s denial of fees to

ALA also creates a clear conflict between the circuits with

regard to the application of this Court’s teaching in Shal-

ala.

3. CONFLICTS WITH DECISIONS OF THE COURTS

OF APPEALS.

The decision is also in conflict with decisions of other

United States courts of appeals where fees were awarded

under “whenever . . . appropriate” statutes notwithstand-

ing that the result in the judicial proceedings did not

preclude adoption of the same agency position after fur-

ther administrative proceedings:

1. In National Wildlife Federation v. Hanson, 859 F.2d

313 (4th Cir. 1988), where the court of appeals rejected the

government's objections to an award of fees for judicial

proceedings resulting in remand of a wetlands deter-

mination to the Army Corps of Engineers without any

determination by the court that the land was a wetland

(“What is at issue here is whether the Corps has properly

performed its duty to make a reasoned wetland deter-

mination. . . . Whether or not the Corps and EPA ulti-

mately determine that tract 1 is wetlands, the NWF will

20

still have served a key purpose of the citizen suit provi-

sion which is to ensure that the agencies fulfill their

duties under the CWA responsibly.”) Id. at 317.

2. Chemical Manufacturers Association v. U.S. EPA,

885 F.2d 1276, 1279 (5th Cir. 1989), where fees were

awarded over the government’s objections after remand

of an EPA rule establishing technology standards under

the Clean Water Act for reconsideration by the agency of

its subcategorization scheme following notice and com-

ment proceedings (“NRDC thus advanced the goal of

reducing pollution, one central to the CWA, by obtaining

an order that the EPA’s subcategorization scheme be

reviewed for possible modification after adequate notice

and comment. ... ”), id., and a remand of new source

performance standards for failure to consider recycling as

“demonstrated technology” (“success on this contention

advances the goals of the CWA by requiring the EPA to

consider technology that might have allowed it to pro-

mulgate lower NSPS.”). Id.

3. Ober v. U.S. Environmental Protection Agency, 84

F.3d 304 (9th Cir. 1996), where fees were awarded for the

remand of EPA’s approval under the Clean Air Act of the

Arizona implementation plan because “[p]etitioners were

prejudiced when they did not have notice of or an oppor-

tunity to comment on the post-comment period justifica-

tions which were submitted by the State and were critical

to the EPA’s approval decision.” The Court “remand[ed]

to the EPA to provide an opportunity for public comment

on the justifications [for the omission of potentially avail-

able emission control measures] submitted by the State

[after the close of the public comment period].” Id. at 315,

316 (fees awarded).

21

4. Sierra Club v. EPA, 769 F.2d 796 (D.C. Cir. 1985),

where the Court granted fee awards for remands of at

least two challenged provisions of EPA’s tall stacks regu-

lations regarding which the Court did not prescribe relief

other than requiring EPA to address questions not ade-

quately addressed in the initial rulemaking.

With the sole exception of this case, courts of appeals

in both the D.C. Circuit and three other circuits have

awarded or authorized the award of fees under “when-

ever . . . appropriate” statutes in cases where agency

failure to consider issues or properly explain the basis for

its decision resulted in a remand for further agency pro-

ceedings. One of the issues remanded by the D.C. Circuit

in Sierra Club, 719 F.2d 436, was sent back to EPA because

the agency made conflicting assumptions regarding the

need for plume downwash demonstrations in different

parts of the rule. The Court found it necessary to reject

“[s]uch inconsistency [a]s the hallmark of arbitrary

action.” Id. at 459. Fees were awarded for success in

showing that agency action to be arbitrary despite the

fact that the Court did not order EPA to adopt one of the

rationales or preclude the Agency from re-adopting the

remanded rules. Sierra Club, 769 F.2d at 805.

Similarly, in Ober v. U.S. EPA, 84 F.3d 304 (9th Cir.

1996), fees were granted under § 307(f) where the Court

found EPA’s approval of the Arizona State Implementa-

tion Plan to be arbitrary and capricious or an abuse of

discretion because EPA relied for its decision on justifica-

tions submitted by Arizona after the close of public com-

ments. Nothing in the decision barred EPA from once

again approving the Arizona implementation plan after

providing an opportunity for public comment.

22

Fees were also granted in National Wildlife Federation

v. Hanson, 859 F.2d 313 (4th Cir. 1988), where the Court

remanded a wetlands decision to the Army Corps of

Engineers as arbitrary and capricious for failure to make

a proper wetlands determination. Again, nothing in the

Court’s decision barred the Corps from renewing the

challenged wetlands determination after conducting a

proper site investigation.

In Chemical Manufacturers Association v. U.S. EPA, 885

F.2d 1276 (5th Cir. 1989), EPA technology standards for a

class of water pollution sources was remanded for failure

to provide notice of EPA’s consideration of subcategories

of sources adopted as part of its final rule, and because

EPA’s failure to consider recycling as a demonstrated

technology was found to be arbitrary and capricious. But

neither of these grounds for remand foreclosed the possi-

bility that EPA might adopt the same source categoriza-

tion scheme or prescribe the same technology standards

after providing notice and an opportunity for comment.

In each of these cases, the remand was predicated on

EPA’s failure to adequately consider relevant factors, give

proper notice or adequately explain the result it reached.

None of these decisions precluded the agency from

adopting its initially challenged position after proceed-

ings on remand, but they did reverse the agency’s initial

decision based on flaws that violated basic requirements

of reasoned decision-making. Since virtually all the other

courts of appeal that have ordered remands of agency

actions on these grounds have also awarded fees to the

parties who won those remands, those precedents create

a conflict among the circuits that should serve as a basis

for allowing a writ in this case.

23

4. SHOWINGS REQUIRED FOR FEE APPLICATION

OPEN A PANDORA'S BOX.

Denying fees because an agency may be able to “jus-

tify its position with a simple response containing no

reformulation of the challenged portion of the rules”

opens a Pandora’s box by requiring the reviewing court

to speculate about the likely outcome of agency proceed-

ings on remand, and possibly the outcome of any later

judicial review of the action taken on remand. This case

demonstrates the potential implications of such a rule,

especially given the array of hurdles EPA must cross in

order to lawfully justify re-adopting the position chal-

lenged in this litigation, and given the Court’s express

decision not to address most of petitioners’ legal argu-

ments on the merits.

In response to EPA’s Advance Notice of Proposed

Rulemaking, announcing its proceeding on remand, for

example, ALA has submitted a long list of reasons why

EPA is precluded from simply re-adopting its initial posi-

tion, including inter alia, 1) the impossibility of satisfying

the requirement of the Court’s remand order that EPA

reconcile its factual findings that the health effects caused

by SO2 bursts “should be regarded as significant from a

public health standpoint” with its legal conclusion that

these effects warrant no regulatory action without chang-

ing one or the other of these positions; 2) the exposure

analysis on which EPA relied for its decision in 1996 is

outdated and unreliable for many reasons and further

reliance on it would be arbitrary and capricious; 3) the

effects of SO2 on asthmatics are so similar to the effects of

ozone that it would be unreasonable for EPA to rely on

24

those effects to revise the ozone NAAQS as it did in 1997

but not rely on them to revise the S02 NAAQS; 4) ALA’s

many legal arguments that the Court declined to address

(e.g., inter alia, “whether the Clean Air Act authorizes the

Administrator to decline to protect an identifiable group

of asthmatics,” ALA, 393), and 5) even if EPA determines

that the health effects of exposure to SO2 bursts are not

“adverse” for the purpose of setting primary NAAQS

under § 109(b)(1), such effects nonetheless trigger EPA’s

duty to set welfare standards adequate to protect against

adverse effects on “personal comfort and well-being”

under §§ 109(b)(2) and 302(h). Clearly, in the face of these

issues EPA cannot simply “justify its position with a

simple response.”

For the Court to decide whether EPA would ulti-

mately be able to lawfully reach the same result it

reached in 1996, it must engage in an inquiry into the

effect of these issues on EPA’s options that goes far

beyond the speculative hypothesis that appears to under-

lie the denial of ALA’s motion for fee eligibility. The

Court of Appeals cannot determine what the range of

permissible answers to these questions might be on the

1996 agency record. Without a new record, the Court can

only speculate about the final result of agency action.

And absent a new decision from the agency, the Court’s

analysis would necessarily prejudge the agency outcome

in ways that could unfairly influence the agency’s deci-

sion, possibly to the prejudice of interest groups who

were not party to the litigation pending before the Court.

In addition to the Pandora’s box these issues open

both for the Court and fee applicants, the inquiry the

Court’s decision invites has no basis in any of the criteria

25

Congress, this Court or other courts have identified as the

basis for an award of fees under § 307(f).

+

CONCLUSION

A writ should be allowed in this case to bring the

D.C. Circuit’s rule governing eligibility for an award of

attorneys’ fees under “whenever . . . appropriate” fee-

shifting statutes in line with the controlling precedent of

this Court, to resolve the conflict with the other United

States courts of appeals that have allowed awards of fees

and costs under the Clean Air Act and other “when-

ever ... appropriate” statutes in similar remand cases,

and to remove the conflict with one other circuit regard-

ing the application of this Court’s criteria for determining

“prevailing party” status in remand cases under Shalala.

A writ to correct the practice of the D.C. Circuit is

especially appropriate given that Court’s exclusive juris-

diction over most, if not all, of the major policy decisions

EPA will make to implement the Clean Air Act, the

Resource Conservation and Recovery Act, and

C.E.R.C.L.A. as well as the disproportionately large

number of agency review actions brought in that Court. If

the congressional policy of authorizing awards of fees

and costs as a means of promoting litigation that contrib-

utes to the effective implementation and administration

of these laws is to be given effect, it must be carried out

26

by the D.C. Circuit in a manner consistent with the teach-

ings of this Court in Ruckelshaus and Shalala. A writ is

necessary to ensure that result.

Respectfully submitted,

Rosert E. YUHNKE

Attorney for Petitioners

1405 Arapahoe Avenue

Boulder, CO 80302

(303) 440-4901

App. 1

United States Court of Appeals

For Tue District of Co_umBiA CIRCUIT

No. 96-1251

September Term, 1998

American Lung Association, et al.,

Petitioners

v.

Environmental Protection Agency and Carol

M. Browner, Administrator, United States

Environmental Protection Agency,

Respondents

Appalachian Power Company, et al.,

Intervenors

Consolidated with 96-1255

BEFORE: Edwards, Chief Judge, Ginsburg and Tatel,

Circuit Judges

ORDER

(Filed March 3, 1999)

Upon consideration of petitioners’ petition for

rehearing filed February 16, 1999, it is

ORDERED that the petition be denied.

Per Curiam

FOR THE COURT:

Mark J. Langer, Clerk

BY: /s/ Robert A. Bonner

Robert A. Bonner

Deputy Clerk

App. 2

United States Court of Appeals

For Tue District of CotumsiA Circuit

Nos. 96-1251 & 96-1255 September Term, 1998

American Lung Association, et al.,

Petitioners

v.

Environmental Protection Agency

and Carol M. Browner, Administrator,

United States Environmental

Protection Agency,

Respondents,

Appalachian Power Company, et al.,

Intervenors.

Before: Epwarps, Chief Judge, Ginssurc and TarEL,

Circuit Judges.

ORDER

(Filed Dec. 31, 1998)

This matter came before the court upon the applica-

tion of Petitioners American Lung Association, Paul J.

Walters, Herbert Raymond Woodruff, and Environmental

Defense Fund for reimbursement of attorneys’ fees pur-

suant to 307(f) of the Clean Air Act, 42 U.S.C. § 7607(1)

(1994), for expenses incurred during their preparation for

American Lung Assoc. v. EPA, 134 F.3d 388 (D.C. Cir. 1998).

In that case, we had before us petitioners’ challenge to

App. 3

the primary national ambient air quality standards for

sulfur dioxide. We remanded to the Agency for a more

complete explanation why it concluded that the substan-

tial physical effects experienced by some asthmatics from

exposure to short-term, high-level sulfur dioxide bursts

do not amount to a public health problem.

This request for fees is controlled by Sierra Club v.

EPA, 769 F.2d 796 (D.C. Cir. 1985). As in that case, peti-

tioners here did not meet with “a modicum of success on

the merits.” Id., at 800, because “[t]he agency may be able

to justify its position with a simple response containing

no reformation of the challenged portion of the rules.”

Id., at 806. It is therefore

ORDERED and ADJUDGED that the petition for

attorneys fees be denied.

Per curiam

FOR THE COURT:

Mark J. Langer, Clerk

BY: /s/ Linda Jones

Deputy Clerk

App. 4

AMERICAN LUNG ASSOCIATION, et al.,

Petitioners,

Vv.

ENVIRONMENTAL PROTECTION AGENCY

and Carol M. Browner, Administrator,

United States Environmental

Protection Agency,

Respondents,

Appalachian Power Company, et al.,

Intervenors.

Nos. 96-1251 & 96-1255,

United States Court of Appeals,

District of Columbia Circuit.

Argued Sept. 26, 1997.

Decided Jan. 30, 1998.

On Petitions for Review of an Order of the Environ-

mental Protection Agency.

Robert E. Yuhnke argued the cause for petitioners.

With him on the briefs were Christine L. Shaver, Boulder,

CO and Howard I. Fox, Washington, DC.

Karen L. Egbert, Attorney, U.S. Department of Jus-

tice, Washington, DC, argued the cause for respondents.

With her on the brief were Lois J. Schiffer, Assistant

Attorney General, and Michael L. Goo, Counsel, Environ-

mental Protection Agency, Washington, DC. Gerald K.

Gleason, Counsel, entered an appearance.

Andrea Bear Field, Henry V. Nickel, Linda C. Trees,

and James R. Bieke, Washington, DC, were on the brief

for intervenor Appalachian Power Company, et al. Ross S.

Antonson, Washington, DC, entered an appearance.

App. 5

Before: EDWARDS, Chief Judge, GINSBURG and

TATEL, Circuit Judges.

Opinion for the Court filed by Circuit Judge TATEL.

TATEL, Circuit Judge:

On behalf of the nation’s nearly nine million asth-

matics, the American Lung Association and the Environ-

mental Defense Fund challenge the Environmental

Protection Agency’s refusal to revise the primary national

ambient air quality standards for sulfur dioxide (SO

sub2). Declining to promulgate a more stringent national

standard, the EPA Administrator concluded that the sub-

stantial physical effects experienced by some asthmatics

from exposure to short-term, high-level SO sub2 bursts

do not amount to a public health problem. Because the

Administrator failed adequately to explain this conclu-

sion, we remand for further elucidation.

I

Driven by its “deep concern for protection of the

health of the American people,” SEN. REP. NO. 91-1196,

at 1 (1970) (“SENATE REPORT”), Congress enacted the

Clean Air Act Amendments of 1970, Pub.L. No. 91-604, 84

Stat. 1676 (1970) (codified as amended at 42 U.S.C.

§§ 7401-7671q (1994)), mandating a “massive attack on air

pollution,” Senate Report at 1. As amended, the Clean Air

Act erects a comprehensive system of national ambient

air quality standards (“NAAQS”) to regulate health-

threatening air pollutants. The statute defines primary

NAAQS as “ambient air quality standards the attainment

App. 6

and maintenance of which in the judgment of the Admin-

istrator, based on such criteria and allowing an adequate

margin of safety, are requisite to protect the public

health.” 42 U.S.C. § 7409(b)(1).

Once the EPA Administrator concludes that a pollu-

tant “may reasonably be anticipated to endanger public

health or welfare” and that it comes from “numerous or

diverse mobile or stationary sources,” id.

§ 7408(a)(1)(A)-(B), the Act requires the Administrator to

produce “criteria,” defined as the latest scientific data on

“all identifiable effects on public health” caused by that

pollutant. Id. § 7408(a)(2). Based on these comprehensive

criteria and taking account of the “preventative” and

“precautionary” nature of the act, Lead Industries Ass‘n,

Inc. v. EPA, 647 F.2d 1130, 1155 (D.C.Cir.1980), the Admin-

istrator must then decide what margin of safety will

protect the public health from the pollutant’s adverse

effects - not just known adverse effects, but those of

scientific uncertainty or that “research has not yet uncov-

ered.” Id. at 1153. Then, and without reference to cost or

technological feasibility, the Administrator must promul-

gate national standards that limit emissions sufficiently to

establish that margin of safety. See 42 U.S.C. § 7409(b)(1);

American Petroleum Inst. v. Costle, 665 F.2d 1176, 1181-82

(D.C.Cir.1981) (describing NAAQS promulgation pro-

cedure); Lead Industries, 647 F.2d at 1148-50 (in establish-

ing NAAQS, Congress deliberately subordinated

economic and technological feasibility concerns to the

achievement of public health goals). States bear primary

responsibility for attaining, maintaining, and enforcing

these standards. See 42 U.S.C. § 7410.

App. 7

In its effort to reduce air pollution, Congress defined

public health broadly. NAAQS must protect not only

average healthy individuals, but also “sensitive citizens”

- children, for example, or people with asthma, emphy-

sema, or other conditions rendering them particularly

vulnerable to air pollution. SENATE REPORT at 10; Lead

Industries, 647 F.2d at 1152. If a’ pollutant adversely affects

the health of these sensitive individuals, EPA must

strengthen the entire national standard. Lead Industries,

647 F.2d at 1153 (NAAQS “must be set at a level at which

there is ‘an absence of adverse effect’ on [] sensitive

individuals”) (quoting SENATE REPORT at 10).

Sulfur Dioxide and Asthmatics

A highly reactive colorless gas smelling like rotten

eggs, sulfur dioxide derives primarily from fossil fuel

combustion. Best known for causing “acid rain,” at ele-

vated concentrations in the ambient air, SO sub2 also

directly impairs human health. As the Administrator

explains in the Final Decision on review here, SO sub2

can affect healthy nonasthmatic individuals at concentra-

tions above 2.0 parts per million (“ppm”); below 2.0 ppm,

it primarily affects people with asthma. National Ambient

Air Quality Standards for Sulfur Oxides (Sulfur Dioxide)

- Final Decision, 61 Fed.Reg. 25,566, 25,570 (1996).

Following the passage of the Clean Air Act, EPA

promulgated the SO sub2 NAAQS in effect today. The

primary standards consist of a 24-hour standard (0.14

ppm averaged over 24 hours not to be exceeded more

than once a year) and an annual standard (0.03 ppm

App. 8

annual arithmetic mean). Id. at 25,568. EPA also estab-

lished a “secondary” three-hour standard (0.50 ppm aver-

aged over three hours not to be exceeded more than once

a year), designed to protect the “public welfare” against

non-health-related effects such as visibility impairment or

environmental degradation, see 42 U.S.C. § 7409(b)(2).

Petitioners do not challenge these existing standards.

Approximately four percent of the nation’s popula-

tion suffers from asthma. Characterized by bron-

choconstriction - shortness of breath, coughing,

wheezing, chest tightness, and sputum production -

asthma is triggered by many different stimuli, including

cold or dry air, exercise or pollen, as well as airborne

pollutants. The effects of bronchoconstriction can vary

from short-term discomfort, such as an hour-long reac-

tion with no lasting after-effects, to asthma attacks requir-

ing medication or hospitalization. Although rare, death

can result.

Sulfur dioxide induces bronchoconstriction in asth-

matics, but only under certain conditions. To experience

adverse effects from SO sub2 concentrations below 1.0

ppm, asthmatics must be exposed for five minutes or

longer while breathing quickly and heavily through both

nose and mouth, the sort of breathing induced by light

exercise, shoveling snow, climbing several flights of

stairs, or jogging to catch a bus. At concentrations above

2.0 ppm, SO sub2 causes adverse effects even if the

exposure lasts less than five minutes or the asthmatic

breathes regularly. See Second Addendum to Air Quality

Criteria for Particulate Matter and Sulfur Oxides (1982):

Assessment of Newly Available Health Effects Informa-

tion (1986).

App. 9

The Challenged Final Decision

This case concerns the effect on asthmatics of what

are known as high-level SO sub2 bursts, defined as emis-

sions of 0.50 ppm or more lasting at least five minutes.

Occurring sporadically and from specific sources, SO

sub2 bursts come primarily from power utilities; the rest

come from nonutility sources such as industrial boilers,

petroleum refineries, pulp and paper mills, sulfuric acid

plants, and aluminum smelters.

Citing the health concerns of asthmatics and relying

on a 1977 amendment to the Clean Air Act, in which

Congress ordered the Agency to review and revise all

criteria and NAAQS by 1980 and at five-year intervals

thereafter, 42 U.S.C. § 7409(d), petitioners urged EPA to

issue a new NAAQS limiting short-term SO sub2 bursts.

Not until 1996, after petitioners sued twice to compel a

decision, see Environmental Defense Fund v. Thomas, 870

F.2d 892 (2d Cir.1989); American Lung Ass'n v. Browner,

Civil Action No. 92-5316 (E.D.N.Y. Nov. 12, 1992), and

after two rounds of public notice and comment, did EPA

issue its final decision regarding SO sub2 NAAQS. See

NAAQS for Sulfur Oxides (Sulfur Dioxide) - Reproposal,

59 Fed.Reg. 58,958 (1994); Proposed Decision Not To

Revise the National Ambient Air Quality Standards for

Sulfur Oxides (Sulfur Dioxide), 53 Fed.Reg. 14,926 (1988).

Rejecting petitioners’ arguments, EPA concluded not only

that the annual and 24-hour primary standards needed

no revision, but also that an additional five-minute stan-

dard was unnecessary to protect asthmatics. See Final

Decision at 25,575-76.

App. 10

In arriving at her final decision, the Administrator

reviewed a decade of data on the extent of high-level

short-term SO sub2 bursts and their effects on public

health. See Review of the National Ambient Air Quality

Standards for Sulfur Oxides: Assessment of Scientific and

Technical Information: Supplement to the 1986 OAQPS

Staff Paper Addendum (Sept. 1994); Supplement to the

Second Addendum (1986) to Air Quality Criteria for Par-

ticulate Matter and Sulfur Oxides (1982): Assessment of

New Findings on Sulfur Dioxide Acute Exposure Health

Effects in Asthmatic Individuals (Aug.1994). Based on

clinical studies of mild to moderate asthmatics, she found

that when such individuals breathe rapidly while

exposed to SO sub2 concentrations of 0.60 ppm for five

minutes, “substantial percentages (> = 25 percent)” expe-

rience effects “distinctly exceeding . . . [the] typical daily

variation in lung function” that asthmatics routinely

experience. Final Decision at 25,572. The severity of these

atypical effects, she found, “is likely to be of sufficient

concern to cause disruption of ongoing activities, use of

bronchodilator medication, and/or possible seeking of

medical attention.” Id.

The scientific community disagreed about the medi-

cal significance of these effects and whether they should

be considered “adverse.” Some experts took the position

that such symptoms usually have no lasting impact,

amounting at worst to a brief period of reversible discom-

fort; others argued that even a one-hour disruption of

activity can amount to a worrisome adverse health effect.

The Administrator left this dispute unresolved. Instead,

she discerned in the medical debate a consensus, which

she adopted, that “repeated occurrences of such effects

App. 11

should be regarded as significant from a public health

standpoint.” Id. at 25,573 (emphasis added).

The Administrator then discussed the three exposure

analyses on which the 1994 version of the proposed rule

rested. These studies estimated that from 180,000 to

395,000 “exposure events” - defined as a heavily breath-

ing asthmatic exposed to an SO sub2 burst - occur annu-

ally, affecting from 68,000 to 166,000 asthmatic

individuals. Id. at 25,574. In view of the Administrator’s

previous finding, reiterated by agency counsel at oral

argument, that at least 25 percent of asthmatics experi-

ence atypical effects from exposure events, these data

suggest that as many as 41,500 (> = 25 percent of 166,000)

asthmatics experience atypical effects from repeated SO

sub2 bursts each year. At the same time, the Administra-

tor acknowledged that subsequent industry studies of

four nonutility sources suggest that the 1994 studies may

have overestimated exposure for certain SO sub2 sources,

id., meaning that the number of affected asthmatics could

be lower. The Administrator did not resolve the conflict

between the studies.

Armed with all these data, the Administrator con-

cluded that “the likelihood that asthmatic individuals

will be exposed . . . is very low when viewed from a

national perspective,” that “5-minute peak SO sub2 levels

do not pose a broad public health problem when viewed

from a national perspective,” and that “short-term peak

concentrations of SO sub2 do not constitute the type of

ubiquitous public health problem for which establishing a

NAAQS would be appropriate.” Id. at 25,575. Describing

SO sub2 bursts as “localized, infrequent and site-speci-

fic,

”

she concluded that a new national standard was

App. 12

unnecessary. Id. The Administrator nevertheless decided

to encourage individual states to address short-term

high-level SO sub2 emissions, initiating a rulemaking to

provide appropriate guidance. Proposed Implementation

Requirements for Reduction of Sulfur Oxide (Sulfur Diox-

ide) Emissions, 62 Fed.Reg. 210 (Jan. 2, 1997) (“Proposed

State Guidelines Rulemaking”) (soliciting public com-

ment on proposed guidelines for state monitoring and

regulation of five-minute peaks of SO sub2).

Petitioners now challenge the Administrator’s deci-

sion declining to promulgate a new NAAQS. They assert

that by failing to establish a five-minute NAAQS capping

SO sub2 emissions at 0.60 ppm, EPA has violated its

statutory responsibility to protect the public health. We

review the Administrator’s decision pursuant to 42 U.S.C.

§ 7607(d)(9)(A)-(C) (“[C]ourt may reverse any such

[agency] action found to be. . . arbitrary, capricious, an

abuse of discretion, or otherwise not in accordance with

law; . . . [or] in excess of statutory . . . authority, or

limitations. ... ”).

II

Petitioners challenge much of the data the Adminis-

trator relied on, as well as the conclusions she drew.

Generally speaking, we will not second-guess EPA in its

area of special expertise. See Natural Resources Defense

Council v. United States EPA, 824 F.2d 1146, 1163

(D.C.Cir.1987) (en banc); American Petroleum Institute, 665

F.2d at 1184. Applying this deferential standard of review,

we accept the Administrator’s analysis of the exposure

studies in the record, as well as the implication of her

App. 13

analysis — that thousands of asthmatics can be expected to

react atypically to SO sub2 bursts each year.

Petitioners contend that the Administrator’s analysis

amounts to a conclusive finding that SO sub2 bursts

adversely affect asthmatics’ health, thus triggering her

duty to promulgate a new NAAQS. See Lead Industries,

647 F.2d at 1153. At oral argument, counsel for EPA

vigorously disputed petitioners’ contention that the

Administrator “found” an adverse health effect. As we

read the record, agency counsel appears to be correct: The

Administrator did not decide whether asthmatic reaction

to SO sub2 bursts - “disruption of ongoing activities, use

of bronchodilator medication, and/or possible seeking of

medical attention” —- amounts to an adverse health effect

or merely, as some medical experts argued, run-of-the-

mill asthma symptoms indistinguishable from bron-

chodilation due to cold air or exercise. Final Decision at

25,572-73. Skipping this disputed question, the Adminis-

trator concluded that, regardless of the impact of single

occurrences, “repeated occurrences of such effects should

be regarded as significant from a public health stand-

point.” Id. at 25,573.

Disagreeing with this approach, petitioners argue

that the Administrator had to answer the subsidiary

“adverse effects” question, pointing to her warning to all

States in the subsequent rulemaking that “[a]lthough

these episodes are few, it is clear that 5-minute SO sub2

ambient concentration peaks pose a health threat to sensi-

tive exposed populations,” Proposed State Guidelines

Rulemaking at 211. We need not decide that issue at this

time, however, because we think the Administrator has

failed to explain the answer she did give, i.e., that SO

App. 14

sub2 bursts do not amount to a “public health” problem

within the meaning of the Act. The link between this

conclusion and the factual record as interpreted by EPA -

that “repeated” exposure is “significant” and that thou-

sands of asthmatics are exposed more than once a year -

is missing. Why is the fact that thousands of asthmatics

can be expected to suffer atypical physical effects from

repeated five-minute bursts of high-level sulfur dioxide

not a public health problem? Why are from 180,000 to

395,000 annual “exposure events” (the range indicated by

the 1994 studies) or some fewer number (as suggested by

the industry studies) so “infrequent” as to warrant no

regulatory action? Why are disruptions of ongoing activ-

ities, use of medication, and hospitalization not “adverse

health effects” for asthmatics? Answers to these questions

appear nowhere in the administrative record.

In her only statement resembling an explanation for

her conclusion that peak SO sub2 bursts present no pub-

lic health hazard, the Administrator characterizes the

bursts as “localized, infrequent and site-specific.” Final

Decision at 25,575. But nothing in the Final Decision

explains away the possibility that “localized,” “site-speci-

fic” or even “infrequent” events might nevertheless cre-

ate a public health problem, particularly since, in some

sense, all pollution is local and site-specific, whether

spewing from the tailpipes of millions of cars or a few

offending smoke stacks. From the record, we know that at

least six communities experience “repeated high 5-minute

peaks greater than 0.60 ppm SO sub2,” id., and agency

counsel told us at oral argument that these so-called “hot

spots” are not the only places where repeated exposure

occurs. Nowhere, however, does the Administrator

App. 15

explain why these data amount to no more than a “local”

problem.

Without answers to these questions, the Administra-

tor cannot fulfill her responsibility under the Clean Air

Act to establish NAAQS “requisite to protect the public

health,” 42 U.S.C. § 7409(b)(1), nor can we. review her

decision. Judicial deference to decisions of administrative

agencies like EPA rests on the fundamental premise that

agencies engage in reasoned decision-making. See Ver-

mont Yankee Nuclear Power Corp. v. Natural Resources

Defense Council, 435 U.S. 519, 524-25, 544-45, 558, 98 S.Ct.

1197, 1202-03, 1211-13, 1219, 55 L.Ed.2d 460 (1978); SEC v.

Chenery Corp., 332 U.S. 194, 209, 67 S.Ct. 1575, 1583-84, 91

L.Ed. 1995 (1947) (agency’s experience, appreciation of

complexities and policies, and responsible treatment of

the facts “justify the use of the administrative process”).

With its delicate balance of thorough record scrutiny and

deference to agency expertise, judicial review can occur

only when agencies explain their decisions with preci-

sion, for “[i]t will not do for a court to be compelled to

guess at the theory underlying the agency’s action... . ”

SEC v. Chenery Corp., 332 U.S. at 196-97, 67 S.Ct. at 1577.

Where, as here, Congress has delegated to an administra-

tive agency the critical task of assessing the public health

and the power to make decisions of national import in

which individuals’ lives and welfare hang in the balance,

that agency has the heaviest of obligations to explain and

expose every step of its reasoning. For these compelling

reasons, we have always required the Administrator to

“cogently explain why [she] has exercised [her] discretion

in a given manner.” Motor Vehicle Mfrs. Ass'n v. State Farm

App. 16

Mut. Auto. Ins., 463 U.S. 29, 48, 103 S.Ct. 2856, 2869, 77

L.Ed.2d 443 (1983).

In this case, the Administrator may well be within

her authority to decide that 41,500 or some smaller

number of exposed asthmatics do not amount to a public

health problem warranting national protective regulation,

or that three or six or twelve annual exposures present no

cause for medical concern. But unless she describes the

standard under which she has arrived at this conclusion,

supported by a “[ |plausible” explanation, id. at 43, 103

S.Ct. at 2866-67, we have no basis for exercising our

responsibility to determine whether her decision is “arbi-

trary, capricious, an abuse of discretion, or otherwise not

in accordance with law; . . . [or] in excess of stat-

utory .. . authority, or limitations. ...” 42 U.S.C.

§ 7607(d)(9)(A)-(C).

Given the gaps in the Final Decision’s reasoning, we

must remand this case to permit the Administrator to

explain her conclusions more fully. We therefore need not

resolve the debate between the parties over whether the

Clean Air Act authorizes the Administrator to decline to

protect an identifiable group of asthmatics from a known

adverse health effect. Although our cases make clear that

the Administrator has broad discretion to establish an

“adequate margin of safety” above and beyond what

scientific certainty prescribes and to craft regulations that

protect against unknown harms, see Lead Industries, 647

F.2d at 1153-55 (Administrator must “err on the side of

caution” when establishing the margin of safety, even

where the “medical significance [of the effects] is a matter

of disagreement”), they do not necessarily establish the

converse proposition - that the Administrator may

App. 17

decline to establish a margin of safety in the face of

documented adverse health effects. Since in this case the

Administrator has failed adequately to explain her con-

clusion that no public health threat exists, we can leave

the issue of the scope of her authority for another day.

We remand this case to the agency for further pro-

ceedings consistent with this opinion.

So ordered.