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OAR Box 1830 

Prepped by Ollie Stewart 

Document Number: 

28) IV-B-24 

Docket Number: 

A-87-11 

Printed 11/13/2008 7:20:52 AM Sheet 28 of 232 
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UNITED STATES COURT Of APFfcALS 

FOR THE DISTRICT OF COLUMBIA CIRCUIT 

.II IN - 3 1993 

NATURAL RESOURCES DEFENSE COUNCIL and 

CENTER FOR AUTO SAFETY, ET AL., 

Petitioners, 

V . 

CAROL M. BKOWNfcK. Administrator, 

U.S. Environmental Protection Agency, 

UNITED STATES ENVIRONMENTAT. PROTECTION 

ACENCY, 

Respondents. 

Case No. 92-1137 

(and Consolidated 

Cases Nos: 92-1142, 

92-1113, 92-1157, 

92-1222, 92-1243, 

and 32-12GO) 

EPA'S RESPONSE TO 

TNTFRVENOR-RESPONOENTS' PETITION FOR REHEARTNfl EN RANC 

INTRODUCTION 

Pursuant to tnis court's March 2J, iyyj order. 

Respondents Carol M. Rrnunpr, Admi ni .cr.rar or, and rho 

Environmental Protection Agency (collectively "EPA"), file this 

rccponcc to the Petition tor Rehearing and Suggestion for 

Rehearing En Banc ("Pel. Fur Reh'y"), filed by IntervenerRespondents American Automobile Manufacturers Association and 

Association of International Automobile Manufacturers, Inc. 

("Intervenore*). 

Interveners' petition for rehearing is premised upon 

their conclusion that the panel held thai Clean Air Act ("CAA") 

section 202(a)(fe), 42 U.S.C. S /521(a)(6), atfords EPA a narrou 

rj-rxnt r»f discretion not to issue standards that require 

automobilec to be equipped with onboard vapor recovery control 

("ORVR") systems within the Act's four-year lead Lime, if after 

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i 

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consultation with the National Highway Traffic Safety 

Administration ("NHTSA"),1 EPA concludes that ORVR systems poec 

unreasonable and inherent safety risks to the public. Pet. For 

Reh'g at 4-5, 8. Based on this reading of the decision. 

Interveners first argue that the panel erred by rejecting EPA's 

position that the alternative Stage II technology should be 

considered when assessing the reasonableness of the risk posed by 

ORVR systems. interveners assert tnat the panel failed to apply 

a Chevron step two analysis in the face of an ambiguous statutory 

provision, and that the panel thus improperly concluded that EPA 

may not consider the risks and benefits of stage TT technology 

when determining whether ORVR systems pose unreasonable safety 

risks. Jd. at 9-11. Second, assuming arguendo that the panel 

properly rejected EPA's approach for analyzing safety risks, 

Interveners argue that the panel should have remanded the/case to 

EPA to allow it to assess whether ORVR systems pose unreasonable 

risks under the Court's newly announced standard for assessing 

risic ana to address the issues that the panel believed had been 

inadequately considered. Jd. at 11-13. Third, Interveners fault 

the panel for concluding that non-canister ORVR systems were 

available for analysis, deupiLe EPA's conclusion to the contrary, 

id. at 13-14. Finally, Interveners base their peLiLiun for 

rehearing in large part upon their assumption that EPA's 

determination under section 202(a)(6) — that canister ORVR 

1 NHTSA is the agency within the Department of 

Transportation responsible for highway safety. 

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systems pose unreasonable and inherent safety risks -- is 

necessarily binding in any subsequent safety analycia ErA 

performs during the certification stage of a vehicle, under CAA 

sections 202(a)(4) and 206(a)(3)(A), 42 U.S.C. SS 7S21(a)(4) and 

7525(a)(3)(A). 14- at 6-7, 10. 

As discussed in more detail below, EPA concurs with 

> . 

some, though not all, of the points Intervenors raise in their 

petition for rehearing. Nevertheless, EPA elected not to--seek 

rehearing or file a suggestion for rehearing en banc. That 

decision was based upon EPA's reading (contrary to that of the 

Intervenors) that the panel's holding rp.solvp.H a question of law 

adequately briefed by the parties; namely, the conclusion that 

EPA has no discretion to decline to issue ORVR standards, 

regardless of the conclusions EPA reaches after consultation with 

NHTSA. EPA also believes that much of the remaining portions of 

the decision constitutes dicta, and thus does not warrant 

reconsideration. However, if these portions are not dicta, the 

panel erred in not remanding to the Agency. Finally, EPA does 

not agree with Intervenors' claim that EPA has already made a 

safety determination legally binding on the certification process 

und*»r sf»ctinns 702(a)(4) and 206(a)(J)(A). This issue was not 

before the panel, and the panel correctly did not reach it. 

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DISCUSSION 

I. THIS COURT INCORRECTLY HELD THAT EPA LACKS DISCRETION 

UNDER SECTION 202(a)(6) TO DECLINE TO ISSUE ORVR 

STANDARDS 

EPA disagrees with Intervenors' basic reading of the 

decision. We believe that the panel's central holding is that, 

irrespective of EPA's conclusions regarding the safety of ORVR 

systems, EPA has an unconditional mandatory duty to issue 

standards that reguire automobiles to be eguipped with such 

systems. Relying upon a Chevron step one analysis, the panel 

concluded that the mandatory duty is manifest on the face of the 

statute, id. at 5, 16-17, 28, and that the provision in section 

202(a)(6) that required EPA to consult with the Department of 

Transportation regarding the safety of ORVR systems "does not 

derogate from that mandatory duty." Id. at 28; see id. at 5, 16-

17. Based upon this, and other portions of the decision,^EPA 

disagrees with Intervenors' reading that the panel concluded that 

section 202(a)(6) affords EPA a narrow grant of discretion not to 

issue ORVR standards, it "EPA were to find that all ORVR systems 

'present inherent and unreasonable safety risks.'" Pet. For 

Reh'g at 4-5 (quoting slip op. at b, 24, 29). Rather, EPA 

believes that the panel rejected EPA's interpretation, and ruled 

that section 202(a)(6) does not afford EPA discretion to decline 

issuance of ORVR standards. 

Although u« read tha panel'c decision differently than 

Intervenors, we also believe that the panel arred in concluding 

that Congress unambiguously expressed its intent in section 

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202(a) (Cy. Congre39 did not define the. prrrir.c imp.ir.r. or f.r.ope 

of the safety conoultation roquiromont in taction 202(a) (6) or 

the ran'jt: of options available if EPA concluded that ORVR systems 

pose unreasonable and inherent safety risks. Rather than 

acknowledge the evistence of this statutory gap in section 

202(a)(6), however, the panel fashioned its own possible 

interpretations of the consultation provision that are plainly 

> . 

not dictated by the lanyuaye, structure, and legislative nistory 

oi section 202(a)(6).* in this manner, the panel railed to 

afford EPA's interpretation the appropriatp deferpnc.p under a 

Chevron step two analysis, and inctead substituted 'its own

 r 

interpretation of section 202(a)(6) for that of the Agency.J 

2 The panel posited *[a)t least two reasons for the 

requirement: first, the process might have been meant to provide 

KPh wit h f% brtt.t.rtv flWrtven«fls o f vnriou s syaten s s o tha t ORVR 

standards might accurately conform tn imminently available 

technology; conversely, the process might allow EPA to structure 

standards that will promote the decign and development of safer 

syst-flflis." Slip op. at. 1R. • 

, 0 

J The panel also erred by resting its holding upon Natural 

Resources Defense council v. Train. 510 F.2d 692, 704 (D.C. Cir. 

1074) . Based upon this decision, the Court concluded that *a 

general consultation clause will not normally render nugatory 

uther substantive requirements." Slip op. at 18. In Train, 

however, the issue ot whether a mandate by congress to promulgate 

guidelines may admit of a narrow exception based upon a safety 

consultation, or any or.her type of r.onaul t;it. ion for thnt nnttf.r, 

was never litigated. Moreover, the consultation provision 

contained in the section aL issue in Tiain (Clean WaLct Act S 

304(b), 33 U.S.C. $ 1314(b)), makes no reference to safety 

whatsoever, and it does not dictate a particular type ot 

technology as does section 202(a)(6) of the Clean Air Act. 

Indeed, in Train. EPA conceded in relevant part that it. had a 

mandatory duty. 310 r.2d at 704. In sum, Lhe panel in Lite 

inctant case failed to grapple with the specific consultation 

provision in section 2u^(a)(6) and its interplay with the other 

portions of the Act as well as the legislative history that 

supports EPA's interpretation. See EPA Brief at 16-39. 

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On balance, EPA concluded that this issue, by itself, 

did not warrant reconsideration by the panel or Court en banc. 

The holding of the panel decision, vhilp. involving an important 

issua, is limited to th« precise language of section 202(a)(6), 

and (iop.fi not bear on EPA's administration of other requirements 

under section 202(a) or the certification process under sections 

202(a)(4) and 206(a)(3)(A) of the Act. Moreover, although we 

disagree with the panel's conclusion, the panel did refet to tne 

appropriate analytical framework for approaching issues of 

statutory construction. Slip op. at 15-16 (citing Chevron U.S.A. 

Inc. v. Natural Resources npfense Council. 467 U.S. 837 (1984)). 

Accordingly, EPA did not seek reconsideration on this issue, and 

does not believe that additional briefing is necessary. The 

Agency's interpretation of section 202(a)(6) has been adequately 

set forth in its brief. However, should the Court choose,•;to 

reconsider this issue, EPA would certainly participate in any 

additional briefing that may be requested. 

II. IN DICTA. THE COURT IMPROPERLY MADE FINDINGS THAT, IF 

RELEVANT, SHOULD HAVE BEEN RESERVED FOR EPA ON REMAND, 

AND WHICH PERTAINED TO ISSUES THAT WERE NOT CHALLENGED 

BY THE PETITIONERS 

Beyond the central holding that EPA has a mandatory 

duty to issue ORVR standards, the panel reached a number of legal 

issues and made factual determinations, some of which were not 

raised in this action, were not briefed by the parties, and were 

unnecessary to tne resolution of the central issue in this case. 

In particular, the panel rejected EPA's methodology for assessing 

the reasonableness of the risk posed by ORVR systems, concluding 

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that Stage TT technology may not be .-nnsidorod, slip op. at 24-

25; it set aside EPA's findings that ,-anister ORVR ay«t.«m« pose, 

unreasonable safety risks and were t hR onl y 0RV R technology 

adequately available for safety conu Iteration by EPA and NHTSA, 

id. at 19-24; and it concluded that non-canister ORVR systems 

were adequately available for safety consideration and apparently 

assumed that canister ORVR systems .-u-o safe. .Id.V 'Because we 

believe that the panel held that EPA iacXed any discretion to 

decline to issue ORVR standards, we <'0nstrued these portions of 

the panel's decision as dicta. Accnr<unglV/ w e concluded that 

these issues did not warrant recona l«ic>ration by the panel or 

Court en banc. 

Assuming arguendo that th«<rtn issues are required for 

the Court's holding, EPA concurs win, tn e intervenors' assessment 

that the panel erred by not remanding t 0 tn e Agency to assess in 

the first instance the safety of ORvw systems under the panel's 

newly announced standard, instead, i i,e pan el appears to have 

made the. ultimate ractual sarety do< nrmination itself, thereby 

improperly acting as * fact-findex- . .uner than a reviewing court. 

See slip op. at 21-24.4 The case i.,w is clear that once the 

panel concluded that EPA'e determinei|on Wd S arbitrary and 

capricious or not in accordance witli iQWf it should have remanded 

that, derision to the Agency for furl lmr consideration. See, 

4 This error was compounded by i h e fac t rha t EPA's findings 

regarding the question of safety of .-nnister ORVR systems, or any 

other ORVR systems, was not squarely challenged by the 

Petitioners and thus not briefed for . he panel's consideration. 

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e.g. . Arkansas v. Oklahoma 112 C. Ct. 1046. 10*0 (1902); Klcppo 

v. Cjcrro Club. 427 U.C. 390, 110 n.31 (1976); FPC v. Idaho Pouor 

Co.. 344 U.S. 17, 20 (1952).5 

In a si milar manner, the Danel should have provided EPA 

with the opportunity on remand to determine whether other 

possible ORVR systems, besides canisters, were adequately 

developed to permit EPA and NHTSA to examine their safety 

features during consultation, instead, the Court improperly made 

the final determination itselr thac cercain non-canister devices 

were available for the consideration of safety. Slip op. at .19-

•>. T . ' ~ 

III. EPA DISAGREES WITH INTERVENORS' POSITION THAT SECTIONS 

202(a)(6) AND 202(a)(4) EMPLOV THE SAME STANDARD, AND 

THAT.VEHICLES EQUIPPED WITH ONBOARD CANISTERS CANNOT AS 

A MATTER OF LAW DE CERTIFIED 

in Its Fina l OilbuaxU D«r<.:i=>iun (.T.A. (5'il-<S7'i) , FPA ili.l 

not address the standard that applies under sections 202(a)(4) 

and 206(a)(7)(A). 42 U.S.C. §§ 752.1(a)(4) and 7525(a)(3)(A), .» 

during the final certification stage that is required before a 

5 To the extent relevant, EPA also concurs with 

intervenors' criticism that Uie panel should have aoooided EPA 

deference under a Chevron etep two analysis in its interpretation 

of the appropriate methodology under section 202(a)(6) to assess 

the risk posed by ORVR systems. See Pet. For Ren'g at 9-10. 

The panel erred by concluding that EPA chould not-, hava r.oncidorod 

the availability of Stage II when balancing the 1/isX.s au*l 

benefits of ORVR canister eyctemc. Because nothing in th«? text 

or legislative history of the Act dictates the panel's 

intftrpr*t.Atinn, T.he. pan«1 should have deferred to EPA's 

reasonable interpretation. 

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new automobile may be sold-6 Specifically, EPA did not determine 

whether it would be appropriate to consider the availability of 

Stage II technology in a section 202(a)(4) certificate 

determination. This was not an element of F.PA's Final Onboard 

Decision, and the panel appropriately did not decide the issue of 

vh*t. the. standard would be during certification. Slip op. at 25 

ri.21; concurrence at 3. EPA concurs with this aspect of the 

panel's decision. The Court need not, and should not, address in 

this proceeding the applicable standard under sections 202:(a) (4) 

and 206(a)(3)(A). 

Intervenors nevertheless state, that EPA has already 

taken action that necessarily forecloses certification of 

vehicles equipped with canister ORVR systems, reasoning that 

EPA's analysis under section 202(a)(6) in the Final Onboard 

Decision, in which the Agency concluded that canister ORVR-' 

systems pose unreasonable safety risks, will necessarily govern 

any subsequent analysis and certificate determination under 

sections 202(a)(4) and 206(a)(3)(A). Pet. For Reh'g at 6-7, 9-

10. Intervenors state further that EPA must consider the 

existence of Stage II technology in assessing the safety ot OKVK 

systems at the certification stage. 

6 Section 206(a)(3)(A) allows EPA to issue a "certificate 

of conformity" to a new automobile or engine, including those 

equipped with new emission control devices, only if that 

automobile or engine satisfies the safety concerns expressed 

under section 2U2(a)(4)(A). New automobiles or engines may not 

be cold until they receive that certificate of conformity from 

EPA. CAA S 206(a)(1), 42 U.S.C. S 7525(a)(1). The certification 

process usually takes place during the 12 months just prior to an 

automobile's introduction for sale. 

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• Intervenors' assertions are incorrect. EPA has 

historically constriied the sections 202(a)(4) and 206(a)(3)(A) 

certification analysis to involve comparisons between different 

versions of vehicle-based control technologies, rather than 

between vehicle-based and non-vehicle based control technologies 

(such as ORVR and Stage II systems) . See CAA § 

202(a)(4)(B)(iii), 42 U.S.C. § 7521(a)(4)(B)(iii)* {limiting the 

evaluation of alternatives to systems "which may be used jto 

conform to requirements prescribed under this subchapter,*, i.e. . 

Subchapter II of the Clean Air Act, 42 U.S.C. §§ 7521-7590, which 

includes vehicle-based emission controls, and does not include 

the Stage II requirement). Accordingly, in considering the 

safety risks of ORVR systems during the certification stage, the 

Agency could perform its analysis without reference to a 

comparison with Stage II systems.' 

Furthermore, and contrary to intervenors' position 

(Pet. For Reh'g at 6), EPA has not made a determination for 

purposes o£ eertirication unaer sections 2U2(a)(4) and 

206(a)(3)(A) that canister ORVR systems, or any other ORVR 

systems, would necessarily pose inherent and unreasonable safety 

' This position O*O«R nor conflict with EPA's position 

(which was rejected by the panel, slip op. at 24) that ORVR and 

Staqe II systems should be compared under the section 202(a)(6) 

safety consultation. Under that section the safety assessment of 

ORVR systems is intimately linked to the availability of Stage II 

as a safe, alternative control technology. See EPA Brief at 19-23 

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risks. Although this possibility always exists,8 those issues 

must now await the certification process, which will not or.r.ur 

for several years. Indeed, EPA does not know the precise nature 

of the ORVR systems that will be submitted for certification, 

especially in light of the panel's decision, and it always 

remains possible that significant design improvements can be 

achieved during this time. In this regard, it is important to 

note that, contrary to interveners' statement (Pet. For Reh'g at 

12), neither EPA nor NHTSA has ever made any determination: 

regarding whether canister ORVR systems pose an unreasonable risk 

in an absolute sense, i.e.,., absent comparisons to Stage II 

systems. See supra at 7-8; J.A. at 654-61; slip op. at 21-24. 

Accordingly, the issue of the standard applicable under sections 

202(a)(4) and 206(a)(3)(A) does not warrant reconsideration. 

• 

Respectfully submitted, / 

MYLES E. FLINT 

Acting Assistant Attorney General 

Environment & Natural Resources 

.vision / 

KAPLAI 

U.S. Department of"Justice 

Environment & Natural Resuutueb 

Division; Rm 7212 

10th & Pennsylvania Ave., N.W. 

Washington, D.C. 20530 

(202) 514-0997 

8 On this point, and for the reasons * J ready stated in 

EPA's Brief at 19-36, the Court erred by concluding that Congress 

did not want EPA to resolve the safety issue up-front, by 

comparing the safety risks and benefits of ORVR systems and the 

alternative Stage II control technology durinq the section 

202(a)(6) rulemaking. 

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- t 

ALAN W. KCKERT 

Associat e Genera l Counsel 

LORIE J. SCHMIDT 

Assistan t Genera l Counsel 

STEVEN SILVERMAN 

Attorne y 

Office of General Counsel 

U.S. Environmental Protection Agency 

Date: April 7, 1993-

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)

 k 

CERTIFICATE OF SFRVTCF 

I hereby certify that on the 7th day of April, 1993, a 

copy of the foregoing pleading was served by telefax where 

indicated, and by first-class mail, postage pre-paid, on the 

following counsel: 

Howard Y. Fox 

Sierra Club Legal Defense Fund 

1531 P Street, N.w. 

Suite 200 

Washington, D.C. <>uuu5 

R. Timothy Columbus 

Michael D. Sherman 

J. Keith Ausbrook 

Collier, Shannon & Scott 

3050 K Street, N.w., suite 400 

Washington, D.C. 20007 

Richard A. Penna 

Van Ness, Feldman & Curtis 

1050 Thomas Jefferson St., N.W. 

7th Floor 

Washington, D.C. 20007 

Alice Crowe 

Douglas Morris 

1220 L Street, N.W. 

9th Floor 

Washington, D.C. 20005 

Kenneth S. Geller 

Mayer, Brown & Piatt Lelefax-861-0473 

2000 Pennsylvania Ave., N.W. 

Washington, D.C. 20006 

Charle s H. LocJcwood 

General Counsel 

Association of International Automobile Manufacturers 

1001 19th St., North - #1200 / 

Arlington, Virginia 22209 

r6 

David J . Kaplan/1 

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