Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-12-01077/USCOURTS-caDC-12-01077-0/pdf.json

Parties Involved:
Environmental Protection Agency
Respondent
Mack Trucks, Inc.
Petitioner
Navistar, Inc.
Intervenor for Respondent
Volvo Group North America, LLC
Petitioner

Document Text:

United States Court of Appeals 

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued May 14, 2012 Decided June 12, 2012 

No. 12-1077 

MACK TRUCKS, INC. AND VOLVO GROUP NORTH AMERICA,

LLC, 

PETITIONERS

v. 

ENVIRONMENTAL PROTECTION AGENCY, 

RESPONDENT

NAVISTAR, INC., 

INTERVENOR

Consolidated with 12-1078, 12-1099 

On Petitions for Review of a Final Rule of the 

United States Environmental Protection Agency 

Christopher T. Handman argued the cause for petitioners. 

With him on the briefs were R. Latane Montague, Sean 

Marotta, Timothy K. Webster, Samuel I. Gutter, Karen K. 

Mongoven, Alec C. Zacaroli, and Julie R. Domike. 

Michele L. Walter, Attorney, U.S. Department of Justice, 

argued the cause and filed the brief for respondent. 

USCA Case #12-1077 Document #1378167 Filed: 06/12/2012 Page 1 of 16
2 

Cary R. Perlman and Laurence H. Levine were on the 

brief intervenor Navistar, Inc. in support of respondents. 

Before: SENTELLE, Chief Judge, BROWN and GRIFFITH, 

Circuit Judges. 

 Opinion for the Court filed by Circuit Judge BROWN. 

 BROWN, Circuit Judge: In January 2012, EPA 

promulgated an interim final rule (IFR) to permit 

manufacturers of heavy-duty diesel engines to pay 

nonconformance penalties (NCPs) in exchange for the right to 

sell noncompliant engines. EPA took this action without 

providing formal notice or an opportunity for comment, 

invoking the “good cause” exception provided in the 

Administrative Procedure Act (APA). Because we find that 

none of the statutory criteria for “good cause” are satisfied, 

we vacate the IFR. 

I 

 In 2001, pursuant to Section 202 of the Clean Air Act 

(“the Act”), EPA enacted a rule requiring a 95 percent 

reduction in the emissions of nitrogen oxide from heavy-duty 

diesel engines. 66 Fed. Reg. 5,002 (Jan. 18, 2001). By 

delaying the effective date until 2010, EPA gave industry nine 

years to innovate the necessary new technologies. Id. at 

5,010. (EPA and manufacturers refer to the rule as the “2010 

NOx standard.” 77 Fed. Reg. 4,678, 4,681 (Jan. 31, 2012).) 

During those nine years, most manufacturers of heavy-duty 

diesel engines, including Petitioners, invested hundreds of 

millions of dollars to develop a technology called “selective 

catalytic reduction.” This technology converts nitrogen oxide 

into nitrogen and water by using a special aftertreatment 

system and a diesel-based chemical agent. With selective 

USCA Case #12-1077 Document #1378167 Filed: 06/12/2012 Page 2 of 16
3 

catalytic reduction, manufacturers have managed to meet the 

2010 NOx standard. 

 One manufacturer, Navistar, took a different approach. 

For its domestic sales, Navistar opted for a form of “exhaust 

gas recirculation,” but this technology proved less successful; 

Navistar’s engines do not meet the 2010 NOx standard. All 

else being equal, Navistar would therefore be unable to sell 

these engines in the United States—unless, of course, it 

adopted a different, compliant technology. But for the last 

few years, Navistar has been able to lawfully forestall that 

result and continue selling its noncompliant engines by using 

banked emission credits.1

 Simply put, it bet on finding a way 

to make exhaust gas recirculation a feasible and compliant 

technology before its finite supply of credits ran out. 

 Navistar’s day of reckoning is fast approaching: its 

supply of credits is dwindling and its engines remain 

noncompliant. In October 2011, Navistar informed EPA that 

it would run out of credits sometime in 2012. EPA, 

estimating that Navistar “might have as little as three to four 

months” of available credits before it “would be forced to stop 

introducing its engines into commerce,” leapt into action.2

 

Resp’t Br. at 2–3. Without formal notice and comment, EPA 

hurriedly promulgated the IFR on January 31, 2012, pursuant 

 

1

 We have discussed EPA’s emissions credits system more fully in 

National Petrochemical & Refiners Association v. EPA, 287 F.3d 

1130, 1148 (D.C. Cir. 2002). 

2

 At oral argument, EPA and counsel for Navistar indicated that 

now, seven months after it notified EPA of its credit shortage, 

Navistar still has and successfully uses credits to sell some 

noncompliant engines. Oral Arg. Recording at 32:35–33:15. 

Navistar also avails itself of the NCPs authorized by the IFR in 

other markets. Navistar, Inc.’s Motion for Leave to Intervene at 3 

(Feb. 28, 2012) [“Navistar Motion”]. 

USCA Case #12-1077 Document #1378167 Filed: 06/12/2012 Page 3 of 16
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to its authority under 42 U.S.C. § 7525(g), to make NCPs 

available to Navistar.3

 To issue NCPs under its regulations, EPA must first find 

that a new emissions standard is “more stringent” or “more 

difficult to achieve” than a prior standard, that “substantial 

work will be required to meet the standard for which the NCP 

is offered,” and that “there is likely to be a technological 

laggard.” 40 C.F.R. § 86.1103-87. EPA found these criteria 

were met. The 2010 NOx standard permits a significantly 

smaller amount of emissions than the prior standard, so the 

first criterion is easily satisfied. As for the second, EPA 

simply said that, because compliant engines (like Petitioners’) 

use new technologies to be compliant, “[i]t is therefore logical 

to conclude . . . that substantial work was required to meet the 

emission standard.” 77 Fed. Reg. at 4,681. Finally, EPA 

determined that there was likely to be a technological laggard 

because “an engine manufacturer [Navistar] . . . has not yet 

met the requirements for technological reasons” and because 

“it is a reasonable possibility that this manufacturer may not 

be able to comply for technological reasons.” Id.

 Having determined that NCPs are appropriate, EPA 

proceeded to set the amount of the penalty and establish the 

“upper limit” of emissions permitted even by a penalty-paying 

manufacturer. The IFR provides that manufacturers may sell 

heavy-duty diesel engines in model years 2012 and 2013 as 

long as they pay a penalty of $1,919 per engine and as long as 

 

3

 The NCP is theoretically available to any heavy-duty diesel 

engine manufacturer, but by discussing only Navistar’s predicament 

in its brief and in the IFR, EPA all but concedes that it issued the 

IFR for solely Navistar’s benefit. See Resp’t Br. at 11–13; 77 Fed. 

Reg. at 4,681. Navistar similarly averred in its motion to intervene 

that “there is no doubt that the engine manufacturer described in 

EPA’s Interim Final Rule is Navistar.” Navistar Motion, at 3. 

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the engines emit fewer than 0.50 grams of nitrogen oxide per 

horsepower-hour. Id. at 4,682–83. This “upper limit” thus 

permits emissions of up to two-and-a-half times the 0.20 

grams permitted under the 2010 NOx standard with which 

Navistar is meant to comply and with which Petitioners do 

comply. See id. at 4,681.

 EPA explained its decision to forego notice and comment 

procedures by invoking the “good cause” exception of the 

APA, id. at 4,680, which provides that an agency may 

dispense with formal notice and comment procedures if the 

agency “for good cause finds . . . that notice and public 

procedure thereon are impracticable, unnecessary, or contrary 

to the public interest,” 5 U.S.C. § 553(b)(B). EPA cited four 

factors to show the existence of good cause: (1) notice and 

comment would mean “the possibility of an engine 

manufacturer [Navistar] . . . being unable to certify a 

complete product line of engines for model year 2012 and/or 

2013,” (2) EPA was only “amending limited provisions in 

existing NCP regulations,” (3) the IFR’s “duration is limited,” 

and (4) “there is no risk to the public interest in allowing 

manufacturers to certify using NCPs before the point at which 

EPA could make them available through a full notice-andcomment rulemaking.” 77 Fed. Reg. at 4,680.

 Petitioners each requested administrative stays of the 

IFR, protesting that EPA lacked good cause within the 

meaning of the APA. Petitioners also objected to the 

substance of the NCP, arguing that EPA misapplied its own 

regulatory criteria for determining when such a penalty is 

warranted, and that EPA arbitrarily and capriciously set the 

amount of the penalty and the “upper limit” level of 

permissible emissions. EPA denied those requests. 

Petitioners promptly filed an emergency motion with this 

Court to expedite review, which we granted. 

USCA Case #12-1077 Document #1378167 Filed: 06/12/2012 Page 5 of 16
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II 

 Navistar, which has intervened on behalf of EPA, claims 

Petitioners lack standing to challenge the IFR. EPA does not 

make such a claim but, of course, we have the independent 

“obligation to satisfy [ourselves]” of our own jurisdiction 

before proceeding to the merits. Dominguez v. UAL Corp., 

666 F.3d 1359, 1362 (D.C. Cir. 2012). 

 Navistar’s sole argument is that Petitioners’ lack 

procedural standing. We have no need to reach this question, 

however, since Petitioners clearly have standing as direct 

competitors of Navistar: they allege the IFR “authorizes 

allegedly illegal transactions that have the clear and 

immediate potential to compete with [their] own sales.” 

Sherley v. Sebelius, 610 F.3d 69, 72–73 (D.C. Cir. 2010). 

Navistar admits it is using NCPs to sell competitive engines, 

see Navistar Motion, at 3, so this injury is anything but 

conjectural. Petitioners’ injury is also “clear[ly]” traceable to 

the IFR which authorizes that allegedly illegal competition, 

and is redressable by a vacatur of the IFR. Sherley, 610 F.3d 

at 72. Finally, because “NCP provisions mandate that 

penalties . . . remove any competitive disadvantage to 

manufacturers whose engines or vehicles achieve the required 

degree of emission reduction,” Petitioners’ “interest in 

avoiding anticompetitive injury plainly falls within the zone 

of interests Congress sought to protect.” Nat’l Petrochem. & 

Refiners Ass’n, 287 F.3d at 1148. Even Navistar does not 

suggest otherwise in its brief. 

 We therefore proceed to the merits. 

USCA Case #12-1077 Document #1378167 Filed: 06/12/2012 Page 6 of 16
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III 

 Petitioners argue first that Section 206 of the Act requires 

notice and comment; alternatively, they claim EPA lacked 

good cause in any event. The APA provides that, “[e]xcept 

when notice or hearing is required by statute,” an agency is 

relieved of its obligation to provide notice and an opportunity 

to comment “when the agency for good cause finds (and 

incorporates the finding and a brief statement of reasons 

therefor in the rules issued) that notice and public procedure 

thereon are impracticable, unnecessary, or contrary to the 

public interest.” 5 U.S.C. § 553(b)(B).4

 

4

 The APA provides a second exception to the notice-and-comment 

requirement: the requirement is lifted when “persons subject thereto 

are named and either personally served or otherwise have actual 

notice thereof in accordance with law.” 5 U.S.C. § 553(b). 

Navistar, and only Navistar, argues that Petitioners had such actual 

notice of the IFR, but Petitioners knew only that EPA was 

gathering information for a possible NCP and merely orally 

supplied some information they thought might be relevant to setting 

the levels of the penalty and upper limit. EPA did not provide a 

draft of the IFR, did not advise Petitioners of the levels, did not 

explain or discuss its methodology, and did not ask Petitioners to 

discuss whether NCPs were justified in the first place. Jorgensen 

Aff. ¶ 15; Kayes Aff. ¶¶ 12–17; Greszler Aff. ¶¶ 11–13. In fact, 

according to Petitioners’ affidavits, EPA suggested the information 

was being gathered to develop a proposal which would in turn be 

subject to ordinary notice and comment—not that this was the end 

of the road. E.g., Greszler Aff. ¶ 13. EPA has not argued to the 

contrary before this Court, and Navistar offers no support for its 

position that such scant and misleading notice is sufficient. It 

certainly pales in comparison to what the APA requires of formal 

notice. See 5 U.S.C. § 553(b)(3) (notice shall include “the terms or 

substance of the proposed rule or a description of the subjects and 

issues involved”); Small Refiner Lead Phase-Down Task Force v. 

EPA, 705 F.2d 506, 549 (D.C. Cir. 1983) (“Agency notice must 

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A 

 Is notice or hearing expressly required by statute? 

Section 206(g)(1) of the Act, 42 U.S.C. § 7525(g)(1), says 

that NCPs shall be provided “under regulations promulgated 

by the Administrator after notice and opportunity for public 

hearing.” According to Petitioners, this is an express 

requirement of notice and comment that bars EPA from even 

invoking the good cause exception in this case. Read alone, 

this language seems to support their argument. But we cannot 

read one subsection in isolation. Davis v. Mich. Dep’t of 

Treasury, 489 U.S. 803, 809 (1989). The rest of Section 

206(g) clearly reveals, as EPA points out, that this 

requirement applies only to the very first NCP rule—which 

set out the regulatory criteria governing future NCPs—not for 

each and every NCP subsequently promulgated. Because 

EPA’s position is clearly correct, we have no need to invoke 

any rule of deference. Chevron, U.S.A., Inc. v. NRDC, 467 

U.S. 837, 843–44 (1984). 

 Subsection (g)(2), the very next paragraph, says that “no 

[NCP] may be issued under paragraph (1) . . . if the degree by 

which the manufacturer fails to meet any standard . . . exceeds 

the percentage determined under regulations promulgated by 

the Administrator to be practicable. Such regulations . . . 

shall be promulgated not later than one year after August 7, 

1977.” 42 U.S.C. § 7525(g)(2) (emphasis added). The 

regulations to which subsection (g)(2) refers are clearly the 

regulations promulgated under subsection (g)(1). Subsection 

(g)(2) explains they are of a guiding nature and, importantly, 

 

describe the range of alternatives being considered with reasonable 

specificity. Otherwise, interested parties will not know what to 

comment on, and notice will not lead to better-informed agency 

decisionmaking.”). It would be wholly illogical to require any less 

from actual notice. 

USCA Case #12-1077 Document #1378167 Filed: 06/12/2012 Page 8 of 16
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that they must be issued by certain a date in 1977. This 

language cannot possibly be read to describe each and every 

NCP. Petitioners’ interpretation of subsection (g)(1), 

suggesting that it does refer to every NCP, would render 

subsection (g)(2) not just superfluous, but impossible—a 

result we must avoid. Motor & Equip. Mfrs. Ass’n, Inc. v. 

EPA, 627 F.2d 1095, 1108 (D.C. Cir. 1979). Subsection 

(g)(3) makes the flaw in Petitioners’ interpretation even 

clearer: “The regulations promulgated under paragraph (1) 

shall, not later than one year after August 7, 1977, provide for 

nonconformance penalties in amounts determined under a 

formula established by the Administrator.” 42 U.S.C. § 

7525(g)(3). Once again, this provision and its deadline reveal 

that subsection (g)(1) refers to a one-time promulgation of a 

formula that governs future penalty applications. Reading 

Section 206(g) as a whole, it is clear nothing in that provision 

requires EPA to provide notice and comment every time it 

applies the original formula to the establishment of specific 

penalties. 

 Contrary to Petitioners’ fears, the Act’s lack of a notice 

and comment requirement does not mean that no procedures 

are statutorily required when NCPs are issued. The APA’s 

general rule requiring notice and comment—absent identified 

exceptions—still obviously applies. Indeed, EPA has always 

argued that the IFR is justified under the good cause 

exception, not that it is justified because notice and comment 

is never required. See 77 Fed. Reg. at 4,680.

B 

 Because the Act does not contain any notice-andcomment requirement applicable to the IFR, EPA may invoke 

the APA’s good cause exception. We must therefore 

determine whether notice and comment were “impracticable, 

USCA Case #12-1077 Document #1378167 Filed: 06/12/2012 Page 9 of 16
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unnecessary, or contrary to the public interest.” 5 U.S.C. § 

553(b)(B). On that question, it would appear we owe EPA’s 

findings no particular deference. See Jifry v. FAA, 370 F.3d 

1174, 1178–79 (D.C. Cir. 2004) (finding good cause without 

resorting to deference); Util. Solid Waste Activities Grp. v. 

EPA, 236 F.3d 749, 754 (D.C. Cir. 2001) (finding no good 

cause without invoking deference). But we need not decide 

the standard of review since, even if we were to review EPA’s 

assertion of “good cause” simply to determine if it is arbitrary 

or capricious, 5 U.S.C. § 706(2)(A), we would still find it 

lacking. 

 We have repeatedly made clear that the good cause 

exception “is to be narrowly construed and only reluctantly 

countenanced.” Util. Solid Waste Activities Grp., 236 F.3d at 

754; Tenn. Gas Pipeline Co. v. FERC, 969 F.2d 1141, 1144 

(D.C. Cir. 1992); New Jersey v. EPA, 626 F.2d 1038, 1045 

(D.C. Cir. 1980); see also Jifry, 370 F.3d at 1179 (“The 

exception excuses notice and comment in emergency 

situations, or where delay could result in serious harm.”); Am. 

Fed. of Gov’t Emps. v. Block, 655 F.2d 1153, 1156 (D.C. Cir. 

1981) (“As the legislative history of the APA makes clear, 

moreover, the exceptions at issue here are not ‘escape clauses’ 

that may be arbitrarily utilized at the agency’s whim. Rather, 

use of these exceptions by administrative agencies should be 

limited to emergency situations . . . .”). 

 First, an agency may invoke the impracticability of notice 

and comment. 5 U.S.C. § 553(b)(B). Our inquiry into 

impracticability “is inevitably fact- or context-dependent,” 

Mid-Tex Electric Coop. v. FERC, 822 F.2d 1123, 1132 (D.C. 

Cir. 1987). For the sake of comparison, we have suggested 

agency action could be sustained on this basis if, for example, 

air travel security agencies would be unable to address threats 

posing “a possible imminent hazard to aircraft, persons, and 

USCA Case #12-1077 Document #1378167 Filed: 06/12/2012 Page 10 of 16
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property within the United States,” Jifry, 370 F.3d at 1179, or 

if “a safety investigation shows that a new safety rule must be 

put in place immediately,” Util. Solid Waste Activities Grp., 

236 F.3d at 755 (ultimately finding that not to be the case and 

rejecting the agency’s argument), or if a rule was of “lifesaving importance” to mine workers in the event of a mine 

explosion, Council of the S. Mountains, Inc. v. Donovan, 653 

F.2d 573, 581 (D.C. Cir. 1981) (describing that circumstance 

as “a special, possibly unique, case”). 

 By contrast, the context of this case reveals that the only 

purpose of the IFR is, as Petitioners put it, “to rescue a lone 

manufacturer from the folly of its own choices.” Pet. Br. at 

29; see 77 Fed. Reg. at 4,680 (expressing EPA’s concern that 

providing notice and comment would mean “the possibility of 

an engine manufacturer [Navistar] . . . being unable to certify 

a complete product line of engines for model year 2012 and/or 

2013”). The IFR does not stave off any imminent threat to 

the environment or safety or national security. It does not 

remedy any real emergency at all, save the “emergency” 

facing Navistar’s bottom line. Indeed, all EPA points to is 

“the serious harm to Navistar and its employees” and “the 

ripple effect on its customers and suppliers,” Resp’t Br. at 28, 

but the same could be said for any manufacturer facing a 

standard with which its product does not comply. 

 EPA claims the harm to Navistar and the resulting upand down-stream impacts should still be enough under our 

precedents. The only case on which it relies, however, is one 

in which an entire industry and its customers were imperiled. 

See Am. Fed. of Gov’t Emps., 655 F.2d at 1157. Navistar’s 

plight is not even remotely close to such a weighty, systemic 

interest, especially since it is a consequence brought about by 

Navistar’s own choice to continue to pursue a technology 

which, so far, is noncompliant. At bottom, EPA’s approach 

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would give agencies “good cause” under the APA every time 

a manufacturer in a regulated field felt a new regulation 

imposed some degree of economic hardship, even if the 

company could have avoided that hardship had it made 

different business choices. This is both nonsensical and in 

direct tension with our longstanding position that the 

exception should be “narrowly construed and only reluctantly 

countenanced.” Util. Solid Waste Activities Grp., 236 F.3d at 

754. 

 Second, an agency may claim notice and comment were 

“unnecessary.” 5 U.S.C. § 553(b)(B). This prong of the good 

cause inquiry is “confined to those situations in which the 

administrative rule is a routine determination, insignificant in 

nature and impact, and inconsequential to the industry and to 

the public.” Util. Solid Waste Activities Grp., 236 F.3d at 

755. This case does not present such a situation. Just as in 

Utility Solid Waste, the IFR is a rule “about which these 

members of the public [the petitioners] were greatly 

interested,” so notice and comment were not “unnecessary.” 

Id. EPA argues that since the IFR is just an interim rule, good 

cause is satisfied because “the interim status of the challenged 

rule is a significant factor” in determining whether notice and 

comment are unnecessary. Resp’t Br. at 35; 77 Fed. Reg. at 

4,680 (finding good cause because the IFR’s “duration is 

limited”). But we held, in the very case on which EPA relies, 

that “the limited nature of the rule cannot in itself justify a 

failure to follow notice and comment procedures.” Mid-Tex 

Electric Coop., 822 F.2d at 1132. And for good reason: if a 

rule’s interim nature were enough to satisfy the element of 

good cause, then “agencies could issue interim rules of 

limited effect for any plausible reason, irrespective of the 

degree of urgency” and “the good cause exception would 

soon swallow the notice and comment rule.” Tenn. Gas 

Pipeline, 969 F.2d at 1145. 

USCA Case #12-1077 Document #1378167 Filed: 06/12/2012 Page 12 of 16
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 EPA’s remaining argument that notice and comment 

were “unnecessary” is that the IFR was essentially ministerial: 

EPA simply input numbers into an NCP-setting formula 

without substantially amending the NCP regime. Resp’t Br. 

at 36; 77 Fed. Reg. at 4,680. But even if it were true that EPA 

arrived at the level of the penalty and the upper limit in this 

way (and Petitioners strenuously argue that EPA actually 

amended the NCP regime in order to arrive at the upper limit 

level in the IFR5), that argument does not account for how 

EPA determined NCPs were warranted in this case in the first 

place—another finding to which Petitioners object. EPA’s 

decision to implement an NCP, perhaps even more than the 

level of the penalty itself, is far from inconsequential or 

routine, and EPA does not even attempt to defend it as such. 

 Finally, an agency may invoke the good cause exception 

if providing notice and comment would be contrary to the 

public interest. 5 U.S.C. § 553(b)(B). In the IFR, EPA says it 

has good cause since “there is no risk to the public interest in 

allowing manufacturers to [use] NCPs before the point at 

which EPA could make them available through a full noticeand-comment rulemaking,” 77 Fed. Reg. at 4,680, but this 

misstates the statutory criterion. The question is not whether 

dispensing with notice and comment would be contrary to the 

public interest, but whether providing notice and comment 

would be contrary to the public interest. By improperly 

framing the question in this way, the IFR inverts the 

presumption, apparently suggesting that notice and comment 

is usually unnecessary. We cannot permit this subtle 

malformation of the APA. The public interest prong of the 

 

5

 EPA admits in its brief that “Petitioners are correct that in past 

rules, EPA based the penalty rates [on certain factors]” and that 

“that was not the case for the Interim Rule.” Resp’t. Br. at 52.

USCA Case #12-1077 Document #1378167 Filed: 06/12/2012 Page 13 of 16
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good cause exception is met only in the rare circumstance 

when ordinary procedures—generally presumed to serve the 

public interest—would in fact harm that interest. It is 

appropriately invoked when the timing and disclosure 

requirements of the usual procedures would defeat the 

purpose of the proposal—if, for example, “announcement of a 

proposed rule would enable the sort of financial manipulation 

the rule sought to prevent.” Util. Solid Waste Activities Grp., 

236 F.3d at 755. In such a circumstance, notice and comment 

could be dispensed with “in order to prevent the amended rule 

from being evaded.” Id. In its brief, EPA belatedly frames 

the inquiry correctly, but goes on to offer nothing more than a 

recapitulation of the harm to Navistar and the associated 

“ripple effects.” Resp’t Br. at 38. To the extent this is an 

argument not preserved by EPA in the IFR, we cannot 

consider it, see SEC v. Chenery Corp., 332 U.S. 194, 196 

(1947), but regardless, it is nothing more than a reincarnation 

of the impracticability argument we have already rejected. 

IV 

 Because EPA lacked good cause to dispense with 

required notice and comment procedures, we conclude the 

IFR must be vacated without reaching Petitioners’ alternative 

arguments. We are aware EPA is currently in the process of 

promulgating a final rule—with the benefit of notice and 

comment—on this precise issue. However, we strongly reject 

EPA’s claim that the challenged errors are harmless simply 

because of the pendency of a properly-noticed final rule. 

Were that true, agencies would have no use for the APA when 

promulgating any interim rules. So long as the agency 

eventually opened a final rule for comment, every error in 

every interim rule—no matter how egregious—could be 

excused as a harmless error. 

USCA Case #12-1077 Document #1378167 Filed: 06/12/2012 Page 14 of 16
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 We do recognize the pending final rule means our vacatur 

of the IFR on these procedural grounds will be of limited 

practical impact. Before the ink is dry on that final rule, we 

offer two observations about the parameters of this 

rulemaking. First, NCPs are meant to be a temporary bridge 

to compliance for manufacturers that have “made every effort 

to comply.” United States v. Caterpillar, Inc., 227 F. Supp. 

2d 73, 88 (D.D.C. 2002). As EPA itself has explained, NCPs 

are not designed to bail out manufacturers that voluntarily 

choose, for whatever reason, not to adopt an existing, 

compliant technology. See 77 Fed. Reg. 4,736, 4,739 (Jan. 

31, 2012) (“NCPs have always been intended for 

manufacturers that cannot meet an emission standard for 

technological reasons rather than manufacturers choosing not 

to comply.”); 50 Fed. Reg. 35,402, 35,403 (Aug. 30, 1985) 

(stating that NCPs are inappropriate “if many manufacturers’ 

vehicles/engines were already meeting the revised standard or 

could do so with relatively minor calibration changes or 

modifications”). Based solely on what EPA has offered in the 

IFR, it at least appears to us that NCPs are likely 

inappropriate in this case. 

 Second, we emphasize that “no legislation pursues its 

purposes at all costs,” Rodriguez v. United States, 480 U.S. 

522, 525–26 (1987), especially when Congress explicitly says 

as much in the legislation. Though the Clean Air Act requires 

EPA to issue NCPs when it determines the necessary criteria 

are satisfied, it also expressly demands that EPA “remove any 

competitive disadvantage to manufacturers whose engines or 

vehicles achieve the required degree of emission reduction.” 

42 U.S.C. § 7525(g)(3)(E). As it is presented in the IFR, we 

are highly skeptical that the penalty and upper limit provided 

for in this NCP satisfy this congressional demand to protect 

compliant manufacturers. 

USCA Case #12-1077 Document #1378167 Filed: 06/12/2012 Page 15 of 16
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 That being said, EPA is certainly free to make whatever 

findings it deems appropriate in the pending final 

rulemaking—subject, of course, to this Court’s review. For 

now, therefore, we simply hold that EPA lacked good cause 

for not providing formal notice-and-comment rulemaking, 

and accordingly vacate the IFR and remand for further 

proceedings. 

So ordered.

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