On Friday, the Court of Appeals for the District of Columbia declined to entertain EPA’s argument that it could dictate venue for review of its decision by including within the decision that it would have “nationwide scope or effect.” Pursuant to Section 307(b)(1) of the CAA, venue over challenges to EPA actions lie exclusively with the Court of Appeals for the District of Columbia only if (1) the final action taken by EPA is “nationally applicable” or (2) EPA found that its final action was based on a determination of “nationwide scope or effect” and it published this finding. Ultimately, the Court of Appeals, in Dalton Trucking, Inc., et al., v. EPA, et al., held that venue was not proper in the District of Columbia and dismissed the petitions for review of EPA’s authorization of the California Air Resources Board (CARB) regulations.

Section 209(e) of the CAA generally preempts states from adopting standards relating to the control of emissions from in-use nonroad diesel engines.  42 U.SC. § 7543(e)91).  However, states are permitted to adopt such standards if they apply for and receive authorization  from EPA. Once EPA authorizes a state’s standards, other states may adopt and enforce identical standards, subject to certain conditions. On September 13, 2013, EPA granted California’s request for a Section 209(e) authorization for CARB’s “Nonroad Fleet Requirements,” requirements aimed at reducing particulate matter and oxides of nitrogen emissions from in-use nonroad diesel engines (hereinafter ) — “As amended, the Nonroad Fleet Requirements apply to persons, businesses, or government agencies owning or operating in California in-use nonroad diesel engines with a maximum horsepower of 25 or greater.”

EPA’s authorization was appealed to both the Court of Appeals for the District of Columbia and Ninth Circuit by Dalton Trucking. EPA moved to dismiss or, alternatively, transfer Petitioners’ Ninth Circuit action to the Court of Appeals for the District of Columbia. Dalton Trucking and the American Road and Transportation Builders Association argued that the Ninth Circuit is the proper venue for their challenges.

The  Court of Appeals for the District of Columbia noted that, “[w]hen a party challenges final actions reviewable under section 307(b)(1), venue is determined as follows:

  • Petitions for review of certain enumerated nationally applicable actions and rules ‘or any other nationally applicable regulations promulgated, or . . . final action taken . . . may be filed only in the United States Court of Appeals for the District of Columbia.’ 42 U.S.C. § 7607(b)(1).
  • Petitions for review of certain enumerated locally or regionally applicable actions ‘or any other final action . . . which is locally or regionally applicable may be filed only in the United States Court of Appeals for the appropriate circuit.’” Id.
  • Petitions for review of ‘locally or regionally applicable’ final actions ‘may be filed only in the United States Court of Appeals for the District of Columbia if such action is based on a determination of nationwide scope or effect and if in taking such action [EPA] finds and publishes that such action is based on such a determination.'” Id.

Upon review, the Court of Appeal confirmed that “[o]n the record before us, we find that EPA’s Nonroad Waiver Decision is not nationally applicable. We also find that EPA neither found that its Nonroad Waiver Decision was based on a determination of nationwide scope or effect nor published such a finding. Therefore, this court is not the proper venue for Petitioners’ challenges.” The Court of Appeals rejected EPA’s several arguments:  (1) EPA’s decision “is a nationally-applicable final action because other States may automatically adopt California’s nonroad standards without further EPA review under 42 U.S.C. § 7543(e);” (2) EPA’s “Nonroad Waiver Decision is a nationally applicable action because California’s Fleet Requirements will regulate off-road diesel engines and vehicles based outside of California; (3) the D.C. Circuit is the proper venue for Petitioners’ challenges because the D.C. Circuit has “consistently treated similar petitions for review as nationally significant actions reviewable in this court;” and (4) venue in the D.C. Circuit is “compelled by [EPA’s] published determination that its action would have a nationwide scope or effect.”

With respect to EPA’s second argument, the Court of Appeals concluded that “[t]o determine whether a final action is nationally applicable, ‘this Court need look only to the face of the rulemaking, rather than to its practical effects,'” citing Am. Rd. & Transp. Builders Ass’n, 705 F.3d at 456 (citing NRDC v. Thomas, 838 F.2d 1224, 1249 (D.C. Cir. 1988)). “By their terms, the Nonroad Fleet Requirements authorized by EPA regulate only nonroad engines and vehicles that are owned or operated in California. And the Nonroad Waiver Decision, on its face, is not nationally applicable because it is limited to fleets operating in California.” With respect to EPA’s fourth argument, when EPA granted the Section 209(e) the CARB regulations, it expressly concluded that:  “My decision will indirectly affect not only persons in California, but also entities outside the state who must comply with California’s requirements. For this reason, I determine and find that this is a final action of national applicability for purposes of section 307(b)(1) of the Act. Pursuant to section 307(b)(10 of the Act, judicial review of this final action may be sought only in the United States Court of Appeals for the District of Columbia Circuit.” The Court of Appeals described this reasoning as “a transparent sleight of hand that does not persuade us.”

The takeaway?  According to the Court of Appeals for the District of Columbia, EPA cannot, by its own determination in one of its decisions, dictate the proper venue for an appeal of the decision based on an overly broad view of the scope of its unique power under the CAA.