Monday, June 29, 2015

A Loss for the Climate

I've been keeping an eye on the Supreme Court case of Michigan v. EPA. This case consisted of several states contesting EPA regulatory procedures concerning emissions from coal- and oil-fired power plants. The Supreme Court granted a hearing on the case limited to the question of whether the EPA "unreasonably refused to consider costs to regulate hazardous air pollutants emitted by electric utilities."

The EPA argued in its written filing that costs do not come into play in the first part of the regulatory process, stating the agency "concluded that costs are not relevant to the decision whether to regulate such emissions, but that costs should instead be taken into account when setting emission standards."

Michigan and 20 other states objected to the wording in the Clean Air Act that states, "The Administrator shall regulate electric utility steam generating units under this section, if the Administrator finds such regulation is appropriate and necessary after considering the results of the study required by this subparagraph." The states argued in their written filings that the word "appropriate" in the sentence is ambiguous and that it renders the EPA "free to find it appropriate to regulate without any regard for the regulations cost."

The Court's decision was released today (June 29) and, by a 5-4 vote, it sided with the states, stating the EPA unreasonably interpreted the Clean Air Act when it set standards.

What does this mean for the Clean Air Act? Really, the only thing it means is the EPA must take one more step and do that much more paperwork in the regulatory process. That means more expense to the taxpayers and that much more time the fossil fuel industry will be allowed to pollute the environment and the public. Of course, the climate is the ultimate loser, which means more damage and suffering by humans, especially the poor.

Will the EPA be back with the regulations? Based on what I read, I believe so. The states, using data from the fossil fuel industry, have stated EPA regulations would achieve $4-6 million worth of health benefits a year by reducing hazardous air pollutants, but would cost the industry $9.6 billion yearly to achieve. But, interestingly, the EPA states the benefits would exceed costs $27 billion to $80 billion (in 2007 dollars). Using the EPA's numbers, regulation would be exceedingly appropriate.


  1. There are a few moving parts here. As all your regulars know, EPA is prepared to issue a CO2 regulation applicable to power plants. Industry had prepared an argument (See Lawrence Tribe's filing here ( that EPA cannot regulate CO2 if it is already regulating mercury. Specifically, the law seems to say that EPA can't add a regulation under section 111(d) if the source is already regulated under section 112. Mercury was regulated under section 112 so, if Tribe is correct in his statutory reading, EPA cannot add a CO2 regulation on the same source under section 111.

    It isn't clear how SCOTUS's ruling affects the CO2 rule. The DC Circuit, which upheld the EPA mercury rule, now gets the case back. The mercury rule may survive in which case we'll get to see Tribe making his argument above plus an argument that people who invested in coal shouldn't have their expectations eviscerated by regulations. Scalia, Roberts and Alito are going to love that one.

    Or maybe the DC Circuit strikes the mercury rule and EPA rewrites its CO2 rule to regulate pursuant to section 112 and does a cost-benefit analysis before final rulemaking.

    I don't know much about the different effects the CO2 and mercury rules would have had, but I have the impression that the CO2 rule is more important. So, maybe SCOTUS just wasted its time.

  2. Would all of this preclude a lawsuit against the government to, as just one possible example, shut down coal-fired power plants for the safety of the public? There are other issues. This is just one.

  3. That's a complicated question, Professor. Let's forget about CAA for a second. The notion of "investment-backed expectations" pertains to Fifth Amendment takings cases. So, say making widgets is lawful in Texas and you find a parcel of land zoned for widget manufacturing. If you buy that land, invest in engineering to build a widget factory, and the government subsequently changes the zoning on your parcel or regulates widget-making out of existence, you would argue that the government "took" the value of your land and prospective business.

    The same analysis pertains to a state's coal-powered electricity generating fleet. It was a lawful use when the investment was made, etc. But, it seems to me that the "look back" period, by which I mean, how far back in time can the investment have taken place in an environment when the investor wasn't reasonably on notice that coal powered generators constituted a clear danger to health and welfare, is very fact specific. I think that EPA's endangerment finding regarding CO2 absolutely put investors on notice that they didn't have a reasonable expectation that a coal powered plant constitutes a long-term investment. Maybe Hansen's testimony to Congress in 1988 was the trigger point.

    The point I'm making (badly) is that as to each plant and each set of investors, there are going to be a bunch of fact questions whether regulating the use out of existence is an unconstitutional taking.

  4. Couldn't someone argue they are having their property unlawfully taken away by the coal-fired plants when their health and welfare is decreased, not to mention damage to real property?

  5. Your facts sound like a suit at the intersection of property law and personal injury law, as opposed to the theories elucidated by Tribe, so the answer is, as with all legal questions, that it depends.

    Leaving aside questions of who owns the coal-fired plant and associated immunity and statute of limitations issues, someone could make that argument. Of course, nuisance law does usually require that the nuisance moved to the plaintiff, meaning the plaintiff owned the affected property before the plant was built. Unless the plant constitutes an abnormally dangerous activity, if I remember correctly. So, as I said, whether the nuisance claim could survive depends on the facts.

    The PI claims are proof dependent and aren't nearly as complicated as the property claims. If the plaintiff can prove a diminution in value and can prove personal damages occurred within the statute of limitations, that suit could be brought.

    So, to finally get at an answer, yes, maybe. But, all an individual plaintiff is likely to get is money.

  6. What if there was a class action lawsuit with 50 million plaintiffs that didn't want monetary remuneration?

  7. Let's cut it down. Suppose there are only 10 million plaintiffs? What if there are only 1 million plaintiffs?

  8. The school of law in Austin is calling you if for no other reason than to write the exams.

    I bet I've read Rule 23 Fed.R.Civ.Proc. ten times in the last 15 years, so beats me. But here is my wild-ass guess. If the class could get certified and is injured in an amount greater than the value of the plant, they could push the utility around.

    I tried to imagine the postage costs associated with a million-person class but got sweaty and had to take a walk.

  9. I think it would be rather easy to get a million-plus people. Set up a website for people to sign up and announce it through the media. You could probably do all of the legal documents that way. Unlike most lawsuits, something like this would benefit by making the documents open and public.

  10. Try a bicycle-ride there, honey. The pedals tend to clear the thought-processes.
    I'll send you the bill.

  11. Spewing mercury pollution is absolutely legal. And it's the lesser of a few evils. What is blood and a few lungs compared to the greater legalistic good?

    And the biblical monkey-god approves wholeheartedly. Three monkeys trying to hump a football comes to mind, but you guys and gals are in law-school so the appropriate ooh's and aah's and getting laid and affording an apartment in a cool city are probably in order as the goddamn climate disintegrates into a hellish hot mess and the planet is unfit for mammalian habitation.

    But continue your argument. It's really fucking important.

  12. Constant GardenerJuly 2, 2015 at 6:41 PM

    If only Rule 23 were so malleable...

  13. I'm not a lawyer, but my reading of Rule 23 is that what we have been discussing is appropriate for a class-action suit.

  14. Constant GardenerJuly 3, 2015 at 8:45 AM

    I don't think the federal courts will step into the breach to regulate away the coal fleet since both the legislative bodies and the regulatory regime have demonstrated an unwillingness to do so. I'm sure SCOTUS won't. But, as to a specific plant, I think class certification might be possible.

  15. The reason, even the basis, for a lawsuit would be that the legislatures and regulatory authorities have failed to protect the public from the damages caused by climate change. As our government, it is their responsibility to ensure the public well-being and they have failed to do so when given the opportunity. So, the idea is the public would turn to the courts for relief.

  16. Constant GardenerJuly 3, 2015 at 4:50 PM

    I get it. And believe me, I am very sympathetic. I'm winding up my practice so I can go defend EPA policy or, better, prosecute actions against polluters.

    Since we've been discussing this a while, and since I've been pulling opinions out of my patoot, I did some poking around to see whether the law regarding class action tort suits as a method to regulate GHGs is established and found this from an amicus brief filed in the D.C. Circuit:

    In the past few years, there have been several comparable attempts to use
    civil litigation to force the regulation of GHGs. See AEP v. Connecticut, 131 S. Ct.
    2527 (2011); Comer v. Murphy Oil USA, Inc., 839 F. Supp. 2d 849 (S.D. Miss.
    2012) (“Comer II”), aff’d, 718 F.3d 460 (5th Cir. 2013); Native Village of Kivalina
    v. ExxonMobil Corp., 696 F.3d 849 (9th Cir. 2012). All of these lawsuits failed for
    the same reason this suit should be dismissed. See id. The Supreme Court, federal
    circuits, and district judges found that the public policy judgments required for
    determining whether and how the U.S. should regulate CO2 emissions are not
    appropriately made by a self-selected group of plaintiffs or judges, and then
    imposed through judicial orders.

    Now the above quotation is from an advocate, and one with whom I disagree, so I went to the AEP decision. Here is the Supreme Court's holding:

    "Here, Massachusetts made plain that emissions of carbon dioxide qualify as air
    pollution subject to regulation under the Clean Air Act. 549 U. S., at
    528–529. And it is equally plain that the Act “speaks directly” to
    emissions of carbon dioxide from the defendants’ plants. The Act directs
    EPA to establish emissions standards for categories of stationary
    sources that, “in [the Administrator’s] judgment,” “caus[e], or
    contribut[e] significantly to, air pollution which may reasonably be
    anticipated to endanger public health or welfare.” §7411(b)(1)(A).
    Once EPA lists a category, it must establish performance standards
    for emission of pollutants from new or modified sources within that
    category, §7411(b)(1)(B), and, most relevant here, must regulate existing
    sources within the same category, §7411(d). The Act also provides
    multiple avenues for enforcement. If EPA does not set emissions
    limits for a particular pollutant or source of pollution, States
    and private parties may petition for a rulemaking on the matter, and
    EPA’s response will be reviewable in federal court. See §7607(b)(1).
    The Act itself thus provides a means to seek limits on emissions of
    carbon dioxide from domestic power plants—the same relief the
    plaintiffs seek by invoking federal common law. There is no room for
    a parallel track."

    The opinion was written by Ruth Bader Ginsburg who was joined by Roberts, Scalia, Breyer and Kagan. Alito and Thomas filed a concurrence. Sotomayor didn't participate, so the decision was 8-0. I'm afraid that federal Tort law is unavailable to force the government to better regulate GHG's.

  17. My understanding of your comment is, since there is an existing means of redress, the courts can't, or won't, address the issue. Is that right?

  18. I think that's right. The federal government has occupied the field, in legal parlance, and having done so, holds the exclusive power to address GHG's.

    That's one thing the idiots in Congress haven't considered when they talk about dismantling EPA.