NEW YORK WASHINGTON PARIS LONDON MILAN ROME FRANKFURT BRUSSELS

in alliance with Dickson Minto W.S., London and Edinburgh

1875 K Street, N.W. 

Washington, DC 20006-1238 

Tel: 202 303 1000 

Fax: 202 303 2000 

Environmental Protection Agency 

EPA Docket Center (EPA/DC) 

Mailcode 6102T 

Attention Docket ID No. EPA-HQ-OAR-2008-0664 

1200 Pennsylvania Avenue, N.W. 

Washington, D.C. 20460 

By electronic delivery to: a-and-r-Docket@epa.gov 

Request to Reopen the Record and Make Price Information Available for Public 

Comment 

Re: Proposed Rule, Protection of Stratospheric Ozone: New Substitute in the Motor 

Vehicle Air Conditioning Sector Under the Significant New Alternatives Policy 

Program 

Docket ID No. EPA-HQ-OAR-2008-0664 

Contact Information

E. Donald Elliott 

Attorney for Arkema 

Willkie Farr & Gallagher LLP 

1875 K St. NW 

Washington, DC 20006 

202-303-1120 

delliott@willkie.com 

Arkema1 submits that the record currently before EPA in Docket ID No. EPA-HQ-OAR2008-0664 is inadequate to enable EPA to make the required statutory findings that HFO-1234yf 

“reduces the overall risk to human health and the environment” and is “currently or potentially 

 

1 Arkema and its North American subsidiary Arkema Inc. (collectively, “Arkema”) are world-class 

producers of industrial chemicals. www.arkema.com and www.arkema-inc.com. Among other 

products, Arkema manufactures HFC-134a and its sales would be affected by the approval of 

HFO-1234yf, so its standing to raise a denial of statutory procedural rights is clear. Mass. v. EPA, 

549 U.S. 497, 518 (2007) (“When a litigant is vested with a procedural right, that litigant has 

standing if there is some possibility that the requested relief will prompt the injury-causing party 

to reconsider the decision that allegedly harmed the litigant.”); Honeywell Int’nl, Inc. v. EPA, 374 

F.3d 1363, 1369 (D.C. Cir. 2004) rehearing granted and opinion partially withdrawn on other 

grounds, No. 02-1294, 2005 U.S. App. LEXIS 298 (D.C. Cir. Jan. 7, 2005). 
Docket ID No. EPA-HQ-OAR-2008-0664 

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available” by comparison to other alternatives that are already available.2 In addition, because of 

the deficiencies in the record, the proposal’s impact on small businesses and State, local and 

tribal governments is inadequately addressed under the Regulatory Flexibility Act3 and the 

Unfunded Mandates Reform Act.4 Therefore, Arkema respectfully requests EPA to: 

(1) Re-open the record for further consideration of the price, terms upon which the 

material would be available, market share and resulting environmental effects. 

(2) Determine that HFO-1234yf is not “currently or potentially available” unless 

Honeywell commits to sell the material at a cost that is not disproportionate to the 

net environmental benefit; 

(3) Subpoena necessary missing information from Honeywell; 

(4) Keep the comment period open until at least 30 days after EPA determines, and 

notifies the public, that it believes that it has obtained and made available in the 

docket “sufficient information” as directed by Congress to adequately assess the 

probable effects of approving HFO-1234yf as a substitute.5

(5) Analyze the impacts on small businesses and State, local and tribal governments 

as required by law. 

 

2 CAA §612(c)(1) and (c)(2). 

3 5 U.S.C. § 601 et seq. 

4 2 U.S.C. § 1501 et seq. 

5 See CAA §612(d)(“ Any petition under this subsection shall include a showing by the petitioner 

that there are data on the substance adequate to support the petition. If the Administrator 

determines that information on the substance is not sufficient to make a determination under 

this sub-section, the Administrator shall use any authority available to the Administrator, under 

any law administered by the Administrator, to acquire such information.” (emphases supplied). 

It is not clear whether Honeywell was behind EPA’s proposal to approve HFO-1234yf and thus is 

“the petitioner.” But regardless, this language reflects a clear Congressional policy that EPA 

should not take unnecessary risks or make guesses about the environmental effects of 

substitutes, but rather must have “adequate ... data” and “sufficient information” before it 

approves a substitute. 
Docket ID No. EPA-HQ-OAR-2008-0664 

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Acting to correct the deficiencies in the present record will save time in the long run. Final action 

could still be taken in time for the 2012 model year, and will reduce the risks of judicial review 

and further delays in the long run.

I. The Current Record Is Not Adequate to Assess Whether Approval Would Reduce Overall 

Risks to Human Health and the Environment.

The current record is inadequate on costs, terms of availability and anticipated market 

share. This is an issue of central relevance because, as EPA has repeatedly recognized, whether 

there will be net benefits for human health and environment from approving HFO-1234yf 

depends not just on its chemical properties but also on how it will be used or misused, to what 

extent and by whom.6 Usage patterns are, in turn dependent upon price, availability and the 

terms on which the material will be made available; therefore, from the beginning of the 

Significant New Alternatives Policy (SNAP) program, EPA has wisely and consistently “required” 

detailed data on availability, price and anticipated market share as “necessary” prior to SNAP 

approval so that EPA can adequately assess anticipated environmental effects. EPA’s SNAP 

regulations could not be more specific about what data is “required” before approval: 

§ 82.178 Information required to be submitted. 

(a) Persons whose substitutes are subject to reporting requirements pursuant to §82.176 

must provide the following information: . . . 

(14) Cost of substitute. Data on the expected average cost of the alternative. In addition, 

information is needed on the expected equipment lifetime for an alternative technology. 

Other critical cost considerations should be identified, as appropriate. 

(15) Availability of substitute. If the substitute is not currently available, the timing of 

availability of a substitute should be provided. 

(16) Anticipated market share. Data on the anticipated near-term and long-term 

nationwide substitute sales.7

 

6 74 Fed. Reg. 53445 (Oct. 19, 2009). 

7 40 C.F.R. § 82.178. 
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When proposing the SNAP rule in 1994, EPA explained why this information is “required” in 

order to approve a proposed substitute: 

In the section that follows, the Agency presents information required by the SNAP 

program to evaluate class I and II substitutes. . . . 

B. Information Required . . . 

14. Cost of Substitute 

The Agency requires data on the expected average cost of the alternative. The cost of 

the substitute can be expressed, for example, in terms of $/pound (for a chemical 

substitute) or as incremental capital and operating costs associated with a retrofit or 

new equipment. In addition, information is needed on the expected equipment life for 

an alternative technology. Other critical cost considerations should be identified, as 

appropriate. For example, it is important to understand the incremental costs 

associated with losses or gains in energy efficiency associated with use of a substitute 

relative to current experience with existing substances. 

15. Availability of Substitute 

The Agency needs to understand the extent to which a substitute is already 

commercially available or the date on which it is expected to become available. The 

timing of availability is an important factor in assessing the overall health and 

environmental effects of the substitute.

16. Anticipated Market Share 

Data on the anticipated near-term and long-term (over the next ten years) nationwide 

substitute sales are also required. This information can be presented in several ways, 

for example: a percentage of existing nationwide use of class I or II chemicals that 

would be replaced in a particular end-use; number of units/products to be produced; 

or pounds of substitute to be sold. This information is required to assess the potential 

effects of a substitute related to total consumption and environmental releases.8

Nonetheless, this “required” information is not available in the current docket. That fact alone 

precludes an approval at this time under the governing Supreme Court case. Allentown Mack 

Sales and Service Inc. v. NLRB, 522 U.S. 359, 376 (1998)(“It is hard to imagine a more violent 

 

8 Protection of Stratospheric Ozone, 59 Fed. Reg. 13044, 13054-55 (Mar. 18, 1994) (emphases 

supplied). See also Honeywell Int'l, Inc. v. EPA, 374 F.3d 1363 (D.C. Cir. 2004) rehearing granted 

and opinion partially withdrawn on other grounds, No. 02-1294, 2005 U.S. App. LEXIS 298 (D.C. 

Cir., Jan. 7, 2005). 
Docket ID No. EPA-HQ-OAR-2008-0664 

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breach of [the requirement of reasoned decision-making] than applying a rule of primary 

conduct ... which is in fact different than the rule or standard formally announced.”). 

Despite EPA’s specifically flagging in its October 2009 proposal that “[d]efinitive costs for 

the refrigerant have not been shared with the Agency,”9 and despite the established EPA 

regulation quoted above that clearly requires this information as “necessary” for approval, 

Honeywell refused to submit any concrete information on cost, availability or anticipated market 

share.10 Instead, EPA has attempted to cobble together its own estimate of price based solely on 

a single conclusory sentence in a news story in the trade press: “DuPont and Honeywell 

representatives have informally estimated the initial price at $40-60/lb (€55-80/kg).”11 This 

article merely parrots a conclusory “informal” estimate by unnamed persons using unspecified 

methodologies and undisclosed assumptions; in addition the range of price is not reliable as such 

with a spread of more than 50%. Finally, it was not in the docket until after the close of the 

comment period. This single reference to a single conclusory sentence in an article in the trade 

press without any indication of how the estimate was actually made does not satisfy EPA’s 

obligation to provide an opportunity for meaningful comment by disclosing the underlying 

 

9 74 Fed. Reg. 53448, 53450 (Oct. 19, 2009). 

10 Honeywell and DuPont have announced a joint venture to produce HFO-1234yf, but neither 

has provided adequate price information. Honeywell merely asserted the naked conclusion, 

without any supporting documentation, that the availability criterion is "unquestionably 

satisfied." Honeywell International Inc., Comments on EPA Proposed Rule Protection of 

Stratospheric Ozone: New Substitute in the Motor Vehicle Air Conditioning Sector Under the 

Significant New Alternatives Policy (SNAP) Program, p. 2 (Feb. 24, 2010). 

11 Weissler, P., 2008. Consensus Building on Refrigerant Type. Automotive Engineering 

International. 9: 30–32., cited by EPA at 74 Fed. Reg. at p. 53450. 
Docket ID No. EPA-HQ-OAR-2008-0664 

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technical basis for its analysis of anticipated environmental effects.12 In addition, recent actions 

by Honeywell have materially changed the landscape regarding price and availability from what 

was assumed by everyone, including EPA, during the comment period. 

During the EPA comment period Honeywell was simultaneously seeking approval of HFO1234yf for incorporation into technical standards issued by the Society of Automotive Engineers 

(“SAE”), which was considering which refrigerant to endorse as the consensus industry standard 

to replace 134a.13 SAE policy requires that patent holders disclose any patents or patent 

applicants that may become essential to the standards under development, and further requires 

that patent holders license their essential technology to all applicants free of charge or on fair, 

reasonable and non-discriminatory terms (“FRAND”).14 However, Honeywell did not disclose to 

the SAE its patents covering HFO-1234yf until April 9, 2010, and has now made clear that it does 

not consider itself as having any obligation to license its patents on FRAND terms.15 Indeed, it 

has refused to issue a license to Arkema on FRAND terms. Honeywell claims that its patents on 

 

12 U.S. v. Nova Scotia Food Products Corp., 568 F.2d 240 (2d Cir. 1977)("To suppress meaningful 

comment by failure to disclose the basic data relied upon is akin to rejecting comment 

altogether."); accord Portland Cement Assn. v. Ruckelshaus, 486 F.2d 375, 387 (D.C. Cir. 1973). 

13 EPA referred specifically to the SAE standards development in the proposal, and proposed that 

HFO-1234yf be permitted for use in automobile air conditioning standards subject to compliance 

with SAE standards. 74 Fed. Reg. at p. 53450. That these standards have now been placed on 

hold is an independent reason that EPA should re-open the comment period to re-assess the 

current situation. 

14 SAE International, Technical Standards Board Governance Policy, 1.14.1.1 (10th Rev. Nov. 

2008) (“(a) a license will be made available without compensation to the applicants desiring to 

utilize the license for the purpose of implementing the standard; or(b) a license will be made 

available to applicants under reasonable terms and conditions that are demonstrably free of any 

unfair discrimination for the purpose of complying with the standard.”)(Copy attached as Exhibit 

1 and requested to be made part of the record). 

15 Letter from Honeywell to Mr. Jack Pokrzywa, SAE Ground Vehicle Standards Manager (April 9, 

2010) (“grant[ing] no rights with respect to these inventions [related to HFO-1234yf] or any 

other invention or intellectual property in which Honeywell has rights.”) (attached as Exhibit 2). 
Docket ID No. EPA-HQ-OAR-2008-0664 

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1234yf would not be infringed by implementation of SAE standards: it pretends it does not hold 

“any invention claimed in a patent the use of which would be required for compliance with [SAE 

standards] and that Honeywell does not believe that [its] inventions are subject to the SAE 

policy.” Arkema does not share this view as Honeywell’s patent covers any use of 1234yf as a 

refrigerant in MVAC. Based on these facts, and a need for the SAE Internal Climate Control 

Standards Committee to resolve certain technical issues, the SAE Motor Vehicle Committee is 

currently delaying indefinitely the approval of 1234yf standards, upon which EPA repeatedly 

relies in the course of its proposal.16 The delay of the SAE standards is an independent ground 

upon which EPA should re-open the record. 

As a result of its position on its patents, Honeywell feels free in both the United States and 

Europe to charge whatever it wishes for HFO-1234yf—a position that it never disclosed in its 

comments to this docket. Nor did EPA conduct any sensitivity analysis of the anticipated 

environmental effects of HFO-1234yf if Honeywell charged a price of five, ten or even a hundred 

times more than the $40-$60 per pound that EPA had assumed in its prior analysis. 

Honeywell’s recently-announced position that it will not license its patents on FRAND 

terms, combined with its refusal to disclose the price at which it intends to market HFO-1234yf, 

materially alters the assumptions underlying EPA’s analysis of price, availability and 

environmental effects in the docket. EPA has simply not analyzed whether HFO-1234yf will 

produce net environmental benefits in a situation in which Honeywell is artificially restricting 

supply and charging monopoly prices for the material. Nor have Arkema and other interested 

parties, including Greenpeace and MACS (who previously expressed concerns about the adverse 

 

16 Letter from SAE Motor Vehicle Committee to SAE Internal Climate Control Standards 

Committee (June 14, 2010). 
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environmental effects from misuse even at the lower price levels EPA was then assuming17) been 

provided an opportunity to submit analysis and comments to the Agency on the anticipated 

environmental effects of approving HFO-1234yf in the “new world order” in which Honeywell 

claims to be the sole legal manufacturer and may charge an as yet undisclosed monopoly rents 

for the product for many years into the future. 

Under these new conditions of supply, prices could be much, much higher than the $40-60 

price assumed by EPA during the comment period. That assumed price was based on a single, 

one sentence conclusion by unnamed sources using unspecified methods in a trade press article 

published in 2008. That “informal estimate” from unnamed sources did not, and could not, take 

into account Honeywell’s current position that it may legally charge monopoly prices. Similarly, 

EPA’s analysis in the proposal also apparently assumed competitive prices and derived its cost 

estimates from assumptions about the additional cost to produce the material, a methodology 

which implicitly assumes competitive pricing (i.e. marginal price equals marginal cost in a 

competitive market but not under a monopoly). The complete discussion of costs by EPA in the 

proposal is as follows: 

Definitive costs for the refrigerant have not been shared with the Agency. Based on 

estimates from Honeywell and DuPont, the cost of HFO-1234yf will be, at least initially, 

approximately $40-60/pound (Weissler, 2008). The cost of the refrigerant will depend 

on several factors, including, but not limited to, how much refrigerant will be available for 

sale, the quality of the refrigerant, and where the refrigerant is manufactured. The cost of 

HFO-1234yf will likely be more than HFC-134a because the HFO-1234yf manufacturing 

process requires more energy and more steps than HFC-134a.18

 

17 Mobile Air Conditioning Society, Comments for Docket ID No. EPA-HQ-OAR-2008-0664, p. 3 

(Dec. 18, 2009) (“With the anticipated substantially higher cost of HFO-1234yf compared to HFC134a, the chance for conversion to other refrigerants—including hydrocarbons—is likely to 

occur unless it is prohibited.”). 

18 74 Fed. Reg. at p. 53450. 
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Neither Weissler nor EPA took into account the possibility of the details of these costs and the 

likely impact of either a refusal to license on FRAND terms. A much higher price would obviously 

completely change usage patterns, the frequency of misuse, and the resulting balance of 

environmental effects. 

Because EPA’s entire environmental analysis is based on price assumptions that were not 

disclosed, and in any event are now no longer valid, EPA has no choice but to re-open the record 

to consider the implications of this sea change in the underlying assumptions about price and 

availability that underlie EPA’s previous analysis of net environmental effects. Re-opening 

would clearly be required by usual principles of administrative law where a material factual 

premise for the agency’s approval has changed after the close of the comment period,19 but in the 

SNAP context in particular, Congress has been crystal-clear that the Agency is not to take 

unnecessary risks with our atmosphere by approving a substitute based on inadequate data. 

Against a historical background in which many new chemicals originally thought to be “green” at 

the time of their introduction later produced unintended consequences, Congress specifically 

legislated that (1) the proponent of a substitute has a specific obligation to provide “data on the 

substance adequate to support” approval and (2) if there is not “sufficient information” in the 

record, EPA “shall” use its subpoena authority to obtain the necessary data before granting or 

denying approval.20 

 

19 Ober v. EPA, 84 F.3d 304, 315 (9th Cir. 1996) ("Petitioners were prejudiced when they did not 

have notice of or an opportunity to comment on the post-comment period justifications which ... 

were critical to the EPA's approval decision."). 

20 CAA §612(d), quoted in full at footnote 5 supra. EPA’s authority to obtain records necessary to 

carryout the provisions of the CAA is in CAA §114, among other places. 
Docket ID No. EPA-HQ-OAR-2008-0664 

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We respectfully request EPA to follow Congress’s specific intent by withholding approval 

until Honeywell provides complete price, availability and market share information as required 

under EPA’s 1994 SNAP policy. Submitting the proper “required” data will enable EPA to 

reassess environmental effects under the new conditions of a Honeywell monopoly. If 

Honeywell is unwilling to supply the information voluntarily, CAA §612(d) commands that EPA 

“shall” subpoena the necessary information before granting or denying approval for a substitute. 

II. EPA Must Re-Open the Record When the SNUR Becomes Final in Any Event.

 

There is also a second, independent but related reason why EPA has no choice but to 

delay approval and to re-open the docket for additional comments. EPA appears to be relying on 

a proposed Significant New Use Restriction (SNUR) under the Toxic Substances Control Act to 

reduce risks to human health from exposure to HFO-1234yf.21 But the terms of the SNUR were 

not yet final at the time that the comment period in this SNAP proceeding closed February 24, 

2010. The two rules are intertwined. EPA has already recognized the inter-relationship by 

extending the SNAP comment period to allow for consideration of the initial SNUR proposal 

published under direct final rulemaking procedures.22 However, an objection was received to 

direct final, and as a result, the SNUR went out for comment and had not yet been finalized when 

 

21 75 Fed. Reg. 16706, 16708-09 (April 2, 2010) ("For the use scenario described in the PMN, 

significant industrial or commercial worker exposure is unlikely due to the use of CAA section 

609 certified refrigerant handling equipment and other protective measures. .. . Further, ‘‘do-ityourself’’ consumer exposures are not expected because the PMN substance only will be sold or 

distributed in 20–pound containers or larger. . . . EPA has determined, however, that . . . sale or 

distribution of the PMN substance in containers smaller than 20-pounds (net weight) may cause 

serious health effects in accordance with 40 CFR 721.170(b)(3)(i)."). 

22 http://www.epa.gov/Ozone/snap/regulations.html (“The comment period has been extended 

through Wednesday, February 24, 2010. The additional time was provided to allow the public to 

consider the newly-issued Significant New Use Rule. Comments on the SNAP rule may be 

submitted through www.regulations.gov under the docket EPA-HQ-OAR-2008-0664.”). 
Docket ID No. EPA-HQ-OAR-2008-0664 

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the comment period closed in the present SNAP proceeding. It would clearly be capricious and 

arbitrary for EPA to require potential commenters in these SNAP proceedings to anticipate what 

final form the SNUR would take long before the comment period on the SNUR had even begun. 

EPA must therefore re-open the SNAP comment period so that commenters may reassess 

anticipated environmental effects in light of the final version of additional restrictions added by 

the SNUR. 

Here again, accurate economic data regarding the new price levels and limited availability 

if Honeywell is able to enforce its patent claims is crucial to assessing how effective the SNUR 

may be in limiting adverse effects. Predicting human behavior under new price conditions is key 

to assessing the likely environmental effects. For example, EPA appears to rely heavily on a 

requirement that HFO-1234yf would not be sold in containers smaller than 20 pounds. 

However, CAA §609(e) has in the past imposed that same requirement on other refrigerants, 

with mixed results, depending upon price and other factors. Once the SNUR becomes final, and a 

new price level under a Honeywell monopoly can be estimated, EPA should re-open the 

proceedings to re-assess the extent to which the SNUR will be effective at limiting adverse 

human health effects. 

III. HFO-1234yf Is Not “Currently or Potentially Available” Unless Honeywell Commits To 

Sell at a Price That Is Not Disproportionate to the Environmental Benefit.

Honeywell’s April announcement that it is refusing to grant FRAND licenses to others to 

produce HFO-1234yf as required by SAE rules, in combination with its prior refusal to make any 

disclosure whatsoever to EPA regarding the price at which Honeywell itself will sell the material, 

presents EPA with an important question of law and policy that it has not previously decided: 

whether a substitute material is “currently or potentially available” under CAA §612(c)(2) if it 
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can be purchased only at a very high price that is disproportionate to the environmental benefit. 

This is a question that was noted, but not decided, by the D.C. Circuit in Honeywell International, 

Inc. v. EPA, 374 F.3d 1363 (D.C. Cir. 2004). In that case, the D.C. Circuit vacated EPA’s reliance 

upon economic factors, but only on the narrow ground that EPA had not officially adopted an 

interpretation of the term “available” in CAA §612(c)(2) as encompassing economic factors; 

instead that position had merely been advanced by EPA’s counsel in argument: 

EPA's reliance on economic constraints requires reversal of its rule. As stated, EPA 

does not justify the rule on the ground that CAA section 612(c) allows it to consider 

economic factors in approving a given substitute as acceptable or unacceptable. 

Nevertheless, EPA's counsel at oral argument said that EPA's position is that it may 

consider costs, and it is at least facially plausible to read the term "available" in section 

612(c) to permit consideration of "economic or practicality" concerns. Such a justification 

cannot pass muster in this Court, however, as the agency did not offer that construction of 

the statute below. Under Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 

467 U.S. 837, 81 L. Ed. 2d 694, 104 S. Ct. 2778 (1984), whether the CAA section 612(c), a 

statute EPA is charged to administer, permits EPA to consider costs is a matter on which 

we defer to the agency's expert judgment, unless its interpretation is unreasonable or if 

the plain terms of the statute say otherwise. Id. at 843-44. 

 In such matters, in which the agency's rule “is valid only as a determination of 

policy or judgment which the agency alone is authorized to make and which it has not 

made, a judicial judgment cannot be made to do service for an administrative judgment.” 

SEC v. Chenery Corp., 318 U.S. 80, 88, 87 L. Ed. 626, 63 S. Ct. 454 (1943). Whether the 

agency's construction of the statute is reasonable under Chevron step two is one such 

issue, given that the issue requires agency expertise. See Kansas City v. HUD, 287 U.S. App. 

D.C. 365, 923 F.2d 188, 192 (D.C. Cir. 1991). Therefore, even assuming, without deciding, 

that the text of section 612(c) permits EPA to interpret the statute to consider costs, we 

must still reverse EPA's decision and remand to the agency. Without knowing the 

agency's interpretation of the statute, we simply have no way of evaluating whether its 

interpretation is reasonable.23

Without deciding the issue because it had not been properly presented, the court strongly 

implied that an interpretation of “available” as including consideration of economic factors 

would be a permissible interpretation under Chevron step II. However, the court stated that 

 

23 Honeywell, 374 F.3d at 1373. 
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since this interpretation had not been addressed one way or the other by EPA in a form and at a 

level that receives Chevron deference, 24 the court would not rule on such an interpretation 

unless and until EPA actually adopts it. But by referring to the issue as “determination of policy 

or judgment which the agency alone is authorized to make,” the D.C. Circuit strongly implied in 

the 2004 Honeywell case was that EPA could interpret the broad statutory term “available” to 

consider “economic factors.” The conclusion that EPA may interpret the “availability” criterion in 

CAA §612 to encompass considerations of cost subsequently received strong validation by the 

U.S. Supreme Court in Entergy Corp. v. Riverkeeper, Inc., No. 07-588, 2009 U.S. LEXIS 2498, (April 

1, 2009). Riverkeeper held that unless Congress has made a specific policy decision to exclude 

the consideration of economics – which it clearly has not done in CAA §612 – then whether and 

how to consider economic factors is a discretionary decision for the agency to which the courts 

will defer provided that the agency’s decision is “reasonable.”

 Arkema recommends that EPA proceed on a step-by-step basis to consider what role cost 

factors should play in approving substitutes under CAA §612. The first step should be to obtain 

information as to the anticipated cost of HFO-1234yf if Honeywell does not grant FRAND 

licenses. This information should be obtained voluntarily if possible, but under subpoena if 

necessary. Then, once data is available on estimated pricing under conditions of a Honeywell 

monopoly, EPA should re-open the comment period to seek public comment on whether 

approval of a substitute at that level of price should be considered “available” in view of the 

extent of environmental benefit involved. Re-opening the record should not result in a delay of 

the use of HFO-1234yf for the 2012 model year. To the contrary, re-opening the record will 

 

24 See generally United States v. Mead Corp., 533 U. S. 218 (2001). 
Docket ID No. EPA-HQ-OAR-2008-0664 

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reduce potential delay by making the approval less susceptible to judicial challenge. This 

important policy decision regarding the role of economic costs under CAA §612 should be made 

in the context of a specific record, rather than in the abstract. 

IV. EPA Has Not Met the Requirements of the Regulatory Flexibility Act or the Unfunded 

Mandates Reform Act of 1995.

 Due to the pricing uncertainties, EPA was not able to adequately consider the regulation’s 

effect on small businesses or whether it would result in the expenditure of more than $100 

million by the private sector. Under the Regulatory Flexibility Act, an agency must assess the 

effect of its regulations on small businesses as a key part of the process for issuing regulations, 

and must use less burdensome alternatives whenever possible.25 In performing its analysis on 

the effects of the proposed rule, the EPA only considered its effect on car manufacturers and car 

air conditioning system manufacturers, concluding that those do not qualify as small businesses. 

However, these regulations will clearly affect countless small businesses including service and 

repair shops, end-of-life vehicle recyclers, and automobile dealerships. In fact, roughly 90% of 

all HFO-1234yf will be used by businesses other than car manufacturers. 

 The potential effect of this rule on small businesses is evidenced by the wide range of 

comments submitted by these various entities. For example, the comments submitted by the 

National Automobile Dealers Association emphasized that a significant number of dealers are 

small businesses and that “all dealership service departments and some dealership auto body 

shops engage in MVAC service and repair.”26 The Institute of Scrap Recycling Industries, Inc. 

 

25 See 5 U.S.C. § 604. 

26 National Automobile Dealers Association, Comments re Protection of Stratospheric Ozone: 

New Substitute in the Motor Vehicle Air Conditioning Sector Under the Significant New 
Docket ID No. EPA-HQ-OAR-2008-0664 

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(“ISRI”)which “represents more than 1,550 companies, a majority of which are small and 

medium-sized”27 submitted comments regarding the occupational and regulatory risks involved 

with the handling of 1234yf in end-of-life vehicles. In order to determine the effect of the 

proposed rule on these, and other small businesses, EPA should determine if a significant change 

in price and supply expectations would affect the way that these businesses handle and deal with 

automobile repairs and recycling. For example, if 1234yf is approved and widely adopted then 

facilities dealing with end-of-life vehicles will have to develop procedures and methods for 

removing it from the vehicles. According to ISRI, whether 1234yf is reclaimed or disposed 

affects how it is regulated, and whether it is reclaimed or disposed of is likely affected by 

1234yf’s cost. 

 In addition, the Unfunded Mandates Reform Act of 1995 requires that, before 

promulgating a rule that could potentially result in the expenditure of $100 million by the 

private sector, an agency must provide a written statement which must include “a qualitative and 

quantitative assessment of the anticipated costs and benefits of the Federal mandate.”28 Without 

knowing the anticipated cost and supply of 1234yf it is impossible for EPA to make the necessary 

determination that this rule will not exceed the $100 million threshold and therefore does not 

require such a written statement. Therefore, EPA must obtain more information on pricing and 

the affect of Honeywell’s patents and FRAND position before it can determine whether the rule 

will exceed the $100 million threshold. 

 

Alternative Policy (SNAP) Program; 40 CFR Part 82; EPA -HQ-OAR-2008-0664, p. 1 (Dec. 18, 

2009). 

27 ISRI, Comments re: Docket ID No. EPA-HQ-OAR-2008-0664 - Protection of Stratospheric 

Ozone: New Substitute in the Motor Vehicle Air Conditioning Sector Under the Significant New 

Alternative Policy (SNAP) Program., p. 1 (Feb. 24, 2010). 

28 2 U.S.C. § 1532. 
Docket ID No. EPA-HQ-OAR-2008-0664 

Page 16 

1841776.1 

* * * * 

It is understandable that EPA might be reluctant to extend the comment period a third 

time. However, it should be noted that the material change in circumstances is entirely 

Honeywell’s doing. If Honeywell had been more forthcoming during the original comment 

period regarding its intentions as to price and availability—as required by long-standing EPA 

regulations and specifically flagged by EPA as missing in the October 2009 Federal Register 

notice—EPA and interested parties could have taken those factors into account from the 

beginning in conducting their analysis of the overall risk to human health and the environment. 

However, that did not occur, and Honeywell is now attempting to fundamentally change the 

ground-rules29 that were assumed by everyone during the prior comment period, and that 

underlie the only price projection in the record of $40-$60 per pound, which is the foundation 

for all of EPA’s analysis of anticipated environmental effects. As a consequence, there is no 

choice now but to defer approval and to re-open the record to obtain the missing data and 

conduct a revised analysis. 

 Respectfully submitted, 

 

 E. Donald Elliott 

 Bret C. Cohen 

 Willkie Farr & Gallagher LLP 

 Attorneys for Arkema and Arkema Inc. 

 

29 Arkema does not concede the validity of Honeywell’s patent claims and has challenged them in 

court. However, the results of that litigation may not be final for some time. In considering 

whether to approve HFO-1234yf, EPA is under an obligation to consider the scenario in which 

the Honeywell patents are held to be valid, and Honeywell is permitted to limit supply and 

charge monopoly rents for the life of the patents. 
Docket ID No. EPA-HQ-OAR-2008-0664 

Page 17 

1841776.1 

We attach two documents referenced but not easily available and request that they be made part 

of the record. 

Enclosures: 

Exhibit 1 - SAE International, Technical Standards Board Governance Policy, 1.14.1.1 (10th Rev. 

Nov. 2008). 

Exhibit 2 - Letter from Honeywell to Mr. Jack Pokrzywa, SAE Ground Vehicle Standards Manager 

(April 9, 2010). 

cc: Margaret Sheppard, Stratospheric Protection Division, Office of Atmospheric Programs, 

U.S. Environmental Protection Agency 

 Jan Tierney, Office of General Counsel, U.S. Environmental Protection Agency 
TECHNICAL 

STANDARDS 

BOARD 

GOVERNANCE 

POLICY 

7th Revision – Approved May 14, 2004 

ANSI Essential Requirements Changes – March 2, 2006 

8th Revision – June 2007 

9th Revision – March 2008 

10th Revision – November 2008 
 - 14 - 

Technical Standards Board 

Governance Policy - 10th Revision – November 2008

POLICY TYPE GOVERNANCE PROCESS 

1.13 Performance Levels

The Technical Standards Board and Councils are responsible for developing specific policies concerning the 

advisability of the Technical Committees developing performance levels for specific procedures or subject 

areas. Such policies will direct development of performance levels for Technical Reports involving dimensional 

requirements or grade, class or type identification and differentiation. When Technical Reports concern major 

systems or complete machines or vehicles, the necessity and desirability of developing performance levels are 

to be directed and accepted by the appropriate Council before development work is commenced by a Technical 

Committee. 

If a Council concludes that performance levels are appropriate, the rationale used by the Technical Committee 

or group in selecting the applicability and limits must be clearly defined for consideration by and submitted for 

approval by its Council. The Technical Committee's rationale shall include information giving reasons for 

identified differences between the submitted Technical Report and other existing standards or regulations. 

Levels, which exceed the state-of-the-art, are to be avoided. 

1.14 Patents, Copyrights and Trademarks

 1.14.1 Patent Disclosure and Inclusion of Patents in SAE Technical Reports 

 There is no objection in principle to drafting a proposed SAE Technical Reports in terms that 

include the use of a patented invention, if it is considered that technical reasons justify this 

approach. 

 Each SAE Technical Committee or SAE working group member would be required to disclose at 

specified times during a development process all patents and patent applications that are owned, 

controlled or licensed by the member, member’s employer or third party and that the member 

believes may become essential to the draft specification under development. The member would 

make this disclosure based on the member’s good faith and reasonable inquiry. 

 If SAE International receives a notice that a proposed SAE Technical Report may require the use 

of an invention claimed in a patent, the procedures in this clause shall be followed. 

 1.14.1.1 Statement from Patent Holder

 Prior to approval of such a proposed SAE Technical Report, SAE International shall 

receive from a party identified as a patent holder or the patent holder (in a form approved 

by SAE International) either: 1) assurance in the form of a general disclaimer to the 

effect that such party does not hold and does not currently intend holding any invention 

claimed in a patent the use of which would be required for compliance with the proposed 

SAE Standard or 2) assurance that: 

 a) a license will be made available without compensation to the applicants desiring to 

utilize the license for the purpose of implementing the standard; or 

 b) a license will be made available to applicants under reasonable terms and conditions 

that are demonstrably free of any unfair discrimination for the purpose of complying with 

the standard. 
 - 15 - 

Technical Standards Board 

Governance Policy - 10th Revision – November 2008

POLICY TYPE GOVERNANCE PROCESS 

1.14 Patents, Copyrights and Trademarks (Continued) 

 1.14.1.2 Record of statement

 A record of the patent holder’s statement shall be placed and retained in the files of SAE 

International. 

 1.14.1.3 Notice

 When SAE International receives from a patent holder the assurance set forth in a) or b) 

above, the standard shall include a note as follows: 

 NOTE – The user’s attention is called to the possibility that compliance with this standard 

may require use of an invention covered by patent rights. 

 By publication of this standard, no position is taken with respect to the validity of this 

claim or of any patent rights in connection therewith. The patent holder has, however, 

filed a statement of willingness to grant a license under these rights on reasonable and 

nondiscriminatory terms and conditions to applicants desiring to obtain such a license for 

the purpose of complying with the standard. Details may be obtained from SAE 

International. 

 1.14.1.4 No Responsibility for identifying patents

 SAE International shall not be responsible for identifying patents for which a license may 

be required by an SAE Technical Report or for conducting inquiries into the legal validity 

or scope of those patents that are brought to its attention. 

 1.14.2 Copyrights

 If the Technical Committee is aware of any copyrights applicable to published material, then such 

material shall not be used in a Technical Report. 

 1.14.3 Trademarks 

 No proprietary names or trademarks shall be used in Technical Reports without written permission of 

the owner together with a generic description of the product sufficient to enable a user to conform to 

the Technical Report without resort to such proprietary product. 

1.15 Notice on All Technical Reports 

 Every approved Technical Report shall carry the following statement: 

 "This report is published by SAE to advance the state of technical and engineering sciences. The use of this 

Technical Report is entirely voluntary, and its applicability and suitability for any particular use, including any 

patent infringement arising therefrom, is the sole responsibility of the user."