On January 25 2018 the Department of Justice (DOJ) issued a new policy, Limiting Use of Agency Guidance Documents in Affirmative Civil Enforcement Cases, in order to prohibit the department from using its civil enforcement authority to compel compliance with agency guidance documents. The new policy extends to federal agencies an earlier policy issued by Attorney General Jeff Sessions that prohibited the DOJ from relying on its own guidance in enforcing the law (see Prohibition of Improper Guidance Documents, issued November 16 2017).
The policy applies to affirmative civil enforcement actions brought by the DOJ. Stating that "[g]uidance documents cannot create binding requirements that do not already exist by statute or regulation", the policy dictates that "effective immediately for ACE cases, the Department may not use its enforcement authority to effectively convert agency guidance documents into binding rules". The policy bars DOJ lawyers from bringing enforcement actions that require compliance with agency guidance documents, which do not have the force of law of statutes or legislative rules.
The new policy has major implications for civil environmental enforcement actions, such as new source review cases and Clean Water Act matters in which the DOJ relies heavily on Environmental Protection Agency (EPA) guidance documents to establish violations of law.
However, it is less certain as to how the new policy will apply to Comprehensive Environmental Response, Compensation and Liability Act 1980 settlements and other related actions, where the EPA traditionally relies on often lengthy guidance documents to guide private party clean-ups.
The DOJ's new policy raises several questions regarding Comprehensive Environmental Response, Compensation and Liability Act actions and other environmental enforcement actions that rely on EPA guidance.
The EPA's model consent decree for remedial design and remedial action contains multiple references to guidance documents, including qualifications for contractors and requirements for posting financial assurance. More so, the EPA's model statement of work defines the detailed requirements for a clean-up. The statement of work is incorporated into the consent decree as an enforceable part of the settlement; for all practical purposes, it is part of the consent decree.
The EPA's model statement of work contains references to more than 40 guidance documents that bind the private parties' conduct. It requires not only adherence to existing guidance documents, but also compliance with "any subsequent modification, amendment, or replacement of such... guidance".
It is not clear whether the new policy applies to a consensual settlement document, in which a private party signing the consent decree agrees to be bound by EPA guidance, rather than being directed to follow the guidance. However, to lodge a Comprehensive Environmental Response, Compensation and Liability Act consent decree, the DOJ simultaneously files a civil complaint with the court. Read broadly, this could cross the line drawn by the policy, which states that the DOJ "may not use its enforcement authority to effectively convert agency guidance documents into binding rules".
Private parties negotiating consent decrees with the DOJ and the EPA should, at least, explore whether the existing policy of demanding compliance with guidance documents as an element of settlement should stand in light of the new policy.
Even if the new policy on guidance documents does not apply to settlement agreements directly (eg, consent decrees) in the first instance, the question arises as to whether it might apply if the DOJ brings a judicial action to enforce a consent decree. For example, if the settling defendant implementing the clean-up is accused of violating the consent decree, which prompts an action by DOJ to enforce the terms of the settlement (including failure to follow EPA guidance documents incorporated into the consent decree and statement of work), the DOJ policy against bringing enforcement actions to "effectively convert agency guidance documents into binding rules" would appear to have been triggered. This is also significant with regard to the question of whether the new policy applies to consent decrees at all. If the DOJ cannot enforce compliance with EPA guidance documents in a case alleging violation of a consent decree, how can the DOJ and the EPA insist on including those guidance documents in the settlement in the first instance?
Consent decrees are not the only documents that require compliance with EPA guidance documents. When the EPA issues a unilateral administrative order to a private party, it attaches a statement of work based on the same model used for consent decrees – which, as discussed above, requires adherence to no fewer than 40 EPA guidance documents.
As a unilateral administrative order is issued by the EPA, not the DOJ, the new DOJ policy does not bind the EPA directly. However, if the respondent refuses to comply with the order, the EPA refers the matter to the DOJ, which must then sue the respondent to enforce the order. Consistent with the new policy, the DOJ cannot bring a new civil enforcement action to compel compliance with an EPA order that requires adherence to dozens of EPA guidance documents. It follows that the EPA cannot include those requirements in a unilateral administrative order in the first instance if they cannot be enforced; to do so provides the respondent with the argument that the order is unlawfully issued and therefore the basis for non-compliance. This will now become an important consideration for a respondent when deciding whether to comply with a Comprehensive Environmental Response, Compensation and Liability Act unilateral administrative order.
The DOJ's enforcement of Clean Air Act matters relies heavily on EPA guidance. In new source review matters, the DOJ typically files lengthy briefs that repeatedly cite agency guidance on issues such as:
- the proper emissions methodology;
- the routine maintenance, repair or replacement exemption; and
- what is considered to be the best available control technology.
The DOJ has also sought to use agency guidance to claim that a defendant had fair notice of the regulatory requirements and counter any alternative interpretation of regulatory text by a defendant. On the mobile source side of air enforcement, the EPA's position on tampering with emissions controls is codified in a 1972 interim guidance, referred to as Memo 1A.
Practically, the new DOJ policy makes it more difficult for line attorneys to obtain approval for Clean Air Act complaints, as merely citing guidance will not be sufficient to establish a violation. Indeed, if the DOJ will not rely on the guidance in litigation, EPA enforcement must assess whether it can rely on the guidance when issuing notices of violation, in settlement discussions or in administrative enforcement proceedings. Likewise, it is reasonable to expect that the DOJ's litigation strategy for filed matters will now undergo scrutiny to ensure that it is limited to enforcement of the four corners of a regulation. For example, DOJ briefs will likely contain far less citation to EPA guidance to establish the agency's position on legal issues.
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For further information on this topic please contact Richard Alonso, Samuel B Boxerman, David T Buente Jr or Justin Savage at Sidley Austin LLP by telephone (+1 202 736 8000) or email (email@example.com, firstname.lastname@example.org, email@example.com or firstname.lastname@example.org). The Sidley Austin LLP website can be accessed at www.sidley.com.