IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF OREGON 

AMERICAN FUEL & PETROCHEMICAL 

MANUFACTURERS, AMERICAN TRUCKING 

ASSOCIATIONS, INC., a trade 

association, and CONSUMER ENERGY 

ALLIANCE, a trade association, 

Plaintiffs, 

v. 

JANE O'KEEFFE, ED ARMSTRONG, 

MORGAN RIDER, COLLEEN JOHNSON, 

and MELINDA EDEN, in their 

official capacities as members 

of the Oregon Environmental 

Quality Commission; DICK PEDERSON, 

JONI HAMMOND, WENDY WILES, DAVID 

COLLIER, JEFFERY STOCUM, CORY-ANN 

WIND, LYDIA EMER, LEAH FELDON, 

GREG ALDRICH, and SUE LANGSTON, 

in their official capacities as 

officers and employees of the 

Oregon Department of Environmental 

Quality; ELLEN ROSENBLUM, in her 

official capacity as Attorney 

General of the State of Oregon; 

and KATE BROWN, in her official 

capacity as Governor of the State 

of Oregon, 

Defendants, 

v. 

CALIFORNIA AIR RESOURCES BOARD, 

STATE OF WASHINGTON, OREGON 

ENVIRONMENTAL COUNCIL, INC., 

CLIMATE SOLUTIONS, NATURAL 

RESOURCES DEFENSE COUNCIL, 

ENVIRONMENTAL DEFENSE FUND, and 

SIERRA CLUB, 

Defendant-Intervenors. 

Page 1 - OPINION AND ORDER 

Case No. 3:15-cv-00467-AA 

OPINION AND ORDER 
AIKEN, Chief Judge: 

Defendants Jane O'Keeffe, Ed Armstrong, Morgan Rider, Colleen 

Johnson, Melinda Eden, Dick Pederson, Joni Hammond, Wendy Wiles, 

David Collier, Jeffrey Stocum, Cory-Ann Wind, Lydia Emer, Leah 

Feldon, Greg Aldrich, Sue Langton, Ellen Rosenblum, and Kate Brown 

move to dismiss plaintiffs American Fuel and Petrochemical 

Manufacturers, American Trucking Associations, Inc., and Consumer 

Energy Alliance's claims pursuant to Fed. R. Civ. P. 12(b) (1) and 

Fed. R. Civ. P. 12 (b) (6). Defendant-intervenors California Air 

Resources Board and the State of Washington (collectively "State 

Intervenors") separately move to dismiss plaintiffs' complaint with 

prejudice. Defendant-intervenors Oregon Environmental Council, 

Inc., Climate Solutions, Natural Resources Defense Council, 

Environmental Defense Fund, and Sierra Club (collectively 

"Conservation Intervenors") also move for judgment on the pleadings 

under Fed. R. Ci v. P. 12 (c) . 1 For the reasons set forth below, 

defendants' and defendant-intervenors' motions are granted, and 

this case is dismissed. 

BACKGROUND 

In 2007, the Oregon legislature found that climate change 

seriously threatened Oregon's economy, environment, and public 

health. Or. Rev. Stat. § 468A.200. These threats included 

1 Defendant-intervenors' arguments in favor of dismissal are 

analogous to those asserted by defendants. Except where otherwise 

indicated, the Court will address defendant-intervenors' and 

defendants' motions together. 

Page 2 - OPINION AND ORDER 
"[r]educed snowpack, changes in the timing of stream flows, extreme 

or unusual weather events, rising sea levels, increased occurrences 

of vector-borne diseases and impacts on forest health." Id. Such 

environmental damage would "have detrimental effects on many of 

[Oregon's] largest industries, including agriculture, wine making, 

tourism, skiing, recreational and commercial fishing, forestry and 

hydropower generation." Id. The Oregon legislature identified a 

need to assess and monitor the current level of greenhouse gas 

emissions ("GHG") in Oregon, "and to take necessary action to begin 

reducing greenhouse gas emissions in order to prevent disruption of 

[Oregon's] economy and quality. of life and to meet [Oregon's] 

responsibility to reduce the impacts and the pace of global 

warming." Id. 

In 2009, the state resolved to lower GHG emissions from 

transportation fuels, which, at 30%, account for the largest single 

market share. Compl. ~ 30; Or. Admin. R. 340-253-0000 (1). 

Specifically, via House Bill 2186, the Oregon ·legislature 

instructed the Oregon Environmental Quality Commission ("EQC") to 

adopt rules to decrease lifecycle GHG emissions from transportation 

fuels, based on their carbon intensities, that are produced in or 

imported to Oregon by 10% over a 10-year period ("Oregon 

Program") 2 Compl. ~~ 30-31; Or. Admin. R. 340-253-0000 (2)- (3). 

2 Lifecycle GHG emissions are the "aggr~gated quantity of 

[GHG] emissions, including direct emissions and significant 

indirect emissions, such as significant emissions from changes in 

land use associated with the fuels; [m]easured over the full fuel 

Page 3 - OPINION AND ORDER 
In 2010, the Department of Environmental Quality ("DEQ") 

convened an advisory committee to help design a program consistent 

with House Bill 2186. Compl. ~~ 30-31. In January 2011, the DEQ 

published a final report outlining the advisory committee's process 

and recommendations. Id. at~ 33. In December 2012, the EQC adopted 

Phase 1 rules for the Oregon Program. Id. at ~ 34. Phase 1 began on 

January 1, 2013, when the state began requiring regulated parties 

-i.e. "[a]ll persons that produce in Oregon or import into Oregon 

any regulated fuel" 3 - to register for the Oregon Program and 

record/report the volumes and carbon intensities of their 

transportation fuels. Or. Admin. R. 340-253-0100(1), 340-253-0200, 

340-253-0500, 340-253-0600-50. 

In January 2015, after the DEQ convened a second advisory 

committee, the EQC adopted Phase 2 rules. Compl. ~~ 35, 37. These 

rules require regulated parties to meet the annual clean fuel 

standards. Or. Admin. R. 340-253-0100-250, 340-253·-0400, 

lifecycle, including all stages of fuel production, from 

feedstock generation or extraction, production, distribution, and 

combustion of the fuel by the consumer; and [s]tated in terms of 

mass values for all [GHGs] as adjusted to C02e to account for the 

relative global warming potential of each gas." Or. Admin. R. 

340-253-0040(37). "Carbon intensity," in turn, is "the amount of 

lifecycle [GHG] emissions per unit of energy of fuel expressed in 

grams of carbon dioxide equivalent per megajoule (gC02e per MJ) ." 

Or. Admin. R. 340-253-0040(9). 

3 The Oregon Program contrasts "regulated fuel," which is 

essentially any traditional fuel such as gasoline or diesel, with 

"clean fuel," which is defined as any "transportation fuel with a 

carbon intensity value lower than the clean fuel standard for 

gasoline or diesel fuel and their substitutes." Or. Admin. R. 

340-253-0200. 

Page 4 - OPINION AND ORDER 
340-253-8010-20. The carbon intensity of a fuel is based on 

OR-GREET, a lifecycle emissions model developed by the Argonne 

National Laboratory and customized for Oregon. Or. Admin. R. 

340-253-0040 (44). The Oregon Program regulations include lookup 

tables that list the carbon intensities of a variety of fuels. 4 Or. 

Admin. R. 340-253-8030-40. 

Beginning in 2016, 5 regulated parties will need to hold 

credits equal to or greater than their deficits, on an annual 

aggregate basis, to demonstrate their compliance with the Oregon 

Program. Or. Admin. R. 340-253-8010-20. A clean fuel credit is 

generated when fuel is produced, imported, dispensed, or used in 

Oregon and the carbon intensity value is lower than the clean fuel 

standard for that year. Or. Admin. R. 340-253-1000(5). Conversely, 

a clean fuel deficit is generated when fuel is produced, imported, 

dispensed, or used in Oregon and the carbon intensity value exceeds 

the clean fuel standard for that year. Or. Admin. R. 

4 These tables, in part, represent default values that 

"incorporate . . average [carbon intensities] for producers 

.within [a] region that use the same mechanical methods and 

thermal-energy source and produce the same co-product." Rocky 

Mountain Farmers Union v. Corey, 730 F.3d 1070, 1093 (9th Cir. 

2013), reh'g denied en bane, 740 F.3d 507 (9th Cir.), cert. 

denied, 134 S.Ct. 2875, 134 S.Ct. 2884 (2014). Other rows 

represent individualized carbon intensity values for particular 

fuel pathways. See, e.g., Or. Admin. R. 340-253-8030 (Table 3). 

Regulated parties are instructed to use the carbon intensity 

value for the fuel that "best matches the description in .the fuel 

pathway" in the lookup tables. Or. Admin. R. 340-253-0400(2). 

5 In March 2015, Governor Brown signed Senate Bill 324, which 

removed the sunset date for the Oregon Program and allowed DEQ to 

continue its implementation efforts. Compl. ~ 38. 

Page 5 - OPINION AND ORDER 
340-253-1000(6). Credits can be bought and sold, banked for the 

future, or used by a fuel importer or producer to offset a deficit 

created by the importation or production of other fuels. Or. Admin. 

R. 340-253-1050. This structure allows regulated parties 

flexibility in complying with the Oregon Program, as no regulated 

party is required to sell any particular fuel or blend of fuels 

with a certain carbon intensity or origin. 

On March 23, 2015, plaintiffs filed a complaint in this Court 

alleging that the Oregon Program: (1) discriminates against out-ofstate commerce in violation of the Commerce Clause; (2) regulates 

extraterritorial activity in violation of the Commerce Clause and 

principles of interstate federalism; (3) is expressly preempted by 

section 211(c) of the Clean Air Act ("CAA") and the Environmental 

Protection Agency's ("EPA") Reformulated Gasoline Rule ("RFGR"); 

and (4) is conflict preempted by section 211(o) of the CAA, which 

contains the Renewable Fuel Standard ( "RFS") as amended by the 

Energy Independence and Security Act ("EISA") . 6 In June 2015, 

6 The Oregon Program is comparable to California's Low Carbon 

Fuel Standard ( "LCFS") . Compare Cal.' Code Regs. tit. 17, §§ 

95480-90, with Or. Admin. R. 340-253-0000-8080. In fact, it is 

undisputed that the Oregon Program was modeled after the LCFS and 

is analogous thereto in all relevant respects. Pls.' Resp. to 

Mots. 3-5, 25; see also State Intervenors' Mot. Dismiss 2-4 

(detailing the similarities between each program). The LCFS was 

recently challenged by several farming and fuel associations, 

including plaintiffs, on many of the same grounds. See generally 

Rocky Mountain, 730 F.3d 1070; Rocky Mountain Farmers Union v. 

Goldstene ("Rocky Mountain II"), 2014 WL 7004725 (E.D.Cal. D~c. 

11, 2014); Am. Fuels & Petrochem. Mfrs. Ass'n v. Corey, 2015 WL 

4872639 (E.D.Cal. Aug. 13, 2015). 

Page 6 - OPINION AND ORDER 
defendants and defendant-intervenors filed the present motions to 

dismiss. 7 

STANDARDS 

Where the court lacks subject-matter jurisdiction, the action' 

must be dismissed. Fed. R. Civ. P. 12(b) (1). The party seeking to 

invoke the subject-matter jurisdiction of the court bears the 

burden of establishing that such jurisdiction exists. Stock W., 

Inc. v. Confederated Tribes of the Colville Reservation, 873 F.2d 

1221, 1225 (9th Cir. 1989). The court may hear evidence regarding 

subject-matter jurisdiction and resolve factual disputes where 

necessary: "no presumptive truthfulness attaches to plaintiff's 

allegations, and the existence of disputed material facts will not 

preclude the [court] from evaluating for itself the merits of 

jurisdictional claims." Kingman Reef Atoll' Invs., LLC v. United 

States, 541 F.3d 1189, 1195 (9th Cir. 2008). 

Where the plaintiff "fails to state a claim upon which relief 

can be granted," the court must dismiss the action. Fed. R. Civ. P. 

7 State Intervenors also request judicial notice of certain 

documents. State Intervenors' First Req. Judicial Notice Exs. AG; State Intervenors' Second Req. Judicial Notice Exs. H-L. 

Additionally, defendants attach materials to their opening and 

reply briefs. Defs.' Mot. Dismiss Appx.; Defs.' Reply to Mot. 

Dismiss Exs. 1-7. Plaintiffs do not object to and, in some 

instances, rely on these documents. Because they are part of the 

public record and/or incorporated by reference into the 

complaint, the Court considers these materials, to the extent 

relevant, in evaluating the present motions. United States v. 

Ritchie, 342 F.3d 903, 908 (9th Cir. 2003) (citations omitted); 

Santa Monica Food Not Bombs v. City of Santa Monica, 450 F.3d 

1022, 1025 n. 2 (9th Cir. 2006) (citations omitted). 

Page 7 - OPINION AND ORDER 
12 (b) ( 6) . To survive a motion to dismiss, the complaint must allege 

nenough facts to state a claim to relief that is plausible on its 

face." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007). 

For the purposes of a Fed. R. Civ. P. 12 (b) (6) motion, the 

complaint is liberally construed in favor of the plaintiff and its 

allegations are taken as true. Rosen v. Walters, 719 F.2d 1422, 

1424 (9th Cir. 1983). Bare assertions that amount to nothing more 

than a nformulaic recitation of the elements" of a claim nare 

conclusory and not entitled to be assumed true." Ashcroft v. Iqbal, 

556 U.S. 662, 680-81 (2009). Rather, to state a plausible claim for 

relief, the complaint nmust contain sufficient allegations of 

underlying facts" to support its legal conclusions. Starr v. Bacca, 

652 F.3d 1202, 1216, reh'g en bane denied, 659 F.3d 850 (9th Cir. 

2011) . 

Judgment on the pleadings is proper where nthe moving party 

clearly establishes on the face of the pleadings that no material 

issue of fact remains to be resolved and that it is entitled to 

judgment as a matter of law." Hal Roach Studios, Inc. v. Richard 

Feiner & Co., 896 F.2d 1542, 1550 (9th Cir. 1990); Fed. R. Civ. P. 

12(c). nRule 12(c) is functionally identical to Rule 12(b) (6) and 

[the] same standard of review applies to motions brought under 

either rule." Cafasso, U.S. ex rel. v. General Dynamics C4 Sys., 

Inc., 637 F.3d 1047, 1054 n.4 (9th Cir. 2011) (citation and 

internal quotations omitted). 

Page 8 - OPINION AND ORDER 
DISCUSSION 

The central issue to be decided in this case is whether the 

Oregon Program violates federal law. Defendants argue that 

dismissal of plaintiffs' Commerce Clause claims is required because 

they are precluded by Rocky Mountain, fail at the pleadings level, 

and/or are not yet ripe. In addition, defendants contend that 

plaintiffs cannot state an express preemption claim because the EPA 

did not affirmatively preclude state regulation of methane. 

Defendants also assert that plaintiffs' conflict preemption claim 

fails because prudential standing is lacking and the RFS and EISA 

are in harmony with the Oregon Program. 8 

I. First Claim: Discrimination 

Plaintiffs allege that the Oregon Program discriminates in 

purpose and effect, as well as facially, "by attempting to regulate 

and control economic conduct occurring outside the borders of 

Oregon, including the extraction, production and distribution of 

transportation fuels." Compl. '!['![ 4, 107-19. 

The Commerce Clause "has long been understood to have a 

'negative' aspect that denies the States the power unjustifiably to 

discriminate against or burden the interstate flow of articles of 

commerce." Or. Waste Sys., Inc. v. Dep' t of Envtl. Quality of State 

8 To the extent plaintiffs maintain that their allegations 

are sufficient or plausible despite the actual text of the 

relevant statues and regulations, or certain contradictory 

judicialli noticeable facts, their argument is without merit. 

Shwarz v. United States, 234 F.3d 428, 435 (9th Cir. 2000). 

Page 9 - OPINION AND ORDER 
of Or . , 511 U . S . 9 3 ( 19 9 4 ) ( citation omitted) . Known as the 

"dormant" Commerce Clause, this aspect is not a complete negative, 

as "the Framers' distrust of economic Balkanization was limited by 

their federalism favoring a degree of local autonomy." Dep't of 

Revenue of Ky. v. Davis, 553 U.S. 328, 338 (2008) (citations 

omitted) . Accordingly, a "state may, if its citizens choose, serve 

as a laboratory; and try novel social and economic experiments 

without risk to the rest of the country." Rocky Mountain, 730 F.3d 

at 1087 (citation and internal quotations omitted). 

"The modern law of what has come to be called the dormant 

Commerce Clause is driven by concern about economic protectionism -

that is, regulatory measures designed to benefit in-state economic 

interests by burdening out-of-state competitors." Davis, 553 U.S. 

at 337-38 (citation and internal quotations omitted). Economic 

protectionism, or discrimination, "simply means differential 

treatment of in-state and out-of-state economic interests that 

benefits the former and burdens the latter." Or. Waste Sys., 511 

U.S. at 99. If a statute discriminates against out-of-state 

entities on its face, in its purpose, or in its practical effect, 

strict scrutiny applies: the law is unconstitutional unless it 

"serves a legitimate local purpose, and this purpose could not be 

served as well by available nondiscriminatory means." Maine v. 

Taylor, 477 U.S. 131, 138 (1986) (citation and internal quotations 

omitted). Absent discrimination, a law will be upheld "unless the 

burden imposed on [interstate] commerce is clearly excessive in 

Page 10 - OPINION AND ORDER 
relation to the putative local benefits." Pike v. Bruce Church, 

Inc., 397 U.S. 137, 142 (1970). 9 "The party challenging the statute 

bears the burden of showing discrimination." Black Star Farms, LLC 

v. Oliver, 600 F.3d 1225, 1230 (9th Cir. 2010). 

The Court notes, at the outset, that plaintiffs' 

discrimination claim is largely barred by on-point precedent: the 

Ninth Circuit held that the LCFS did not facially discriminate 

against out-of-state ethanol or petroleum, and did not discriminate 

in purpose or effect against out-of-state petroleum. Rocky 

Mountain, 730 F. 3d at 1107. The only issue related to 

discrimination that falls outside Rocky Mountain is whether the 

Oregon Program discriminates in purpose or effect against out-ofstate ethanol. Rocky Mountain II, 2014 WL 7004725 at *14-15 

(citations omitted). While plaintiffs concede that Rocky Mountain 

"controls" certain issues, they nonetheless disagree and categorize 

its holdings as largely non-binding because it "involved a 

different state's officials, a different statute and regulations, 

a different record, and different statements." Pls.' Resp. to Mots. 

2, 11, 18-19. Plaintiffs further seek to preserve their arguments 

for appeal, such that the Court will address all aspects of their 

9 Plaintiffs neither argue nor allege that the Oregon 

Program fails under the balancing test articulated in Pike. See 

generally Compl.; Pls.' Resp. to Mots.; see also Rocky Mountain 

ll, 2014 WL 7004725 at *15 n.16 (plaintiffs "abandon[ed] their 

Pike challenges to both the crude oil and ethanol provisions of 

the LCFS"). Therefore, the sole issue i$ whether the Oregon 

Program ·is discriminatory. 

Page 11 - OPINION AND ORDER 
discrimination claim. 

A. Facial Discrimination 

Plaintiff's assert that the Oregon Program is facially invalid 

because it discriminates against petroleum by "assign[ing] 

petroleum a higher carbon intensity than ethanol and other Oregon 

biofuels" - and Midwest ethanol - because "[t] he lookup tables 

consistently give higher scores to ethanol produced in the Midwest 

than to ethanol produced using the same process in Oregon." Pls.' 

Resp. to Mots. 16-18 (citing Compl. ~~ 55-59, 66-80). 

Initially, plaintiffs do not meaningfully address how 

petroleum and ethanol are similarly situated or cite to any 

well-pleaded factual allegations to that effect. See generally 

Compl.; Pls.' Resp. to Mots.; see also General Motors Corp. v. 

Tracy, 519 U.S. 278, 298-99, 310 (1997) (when the alleged 

discrimination involves "entities [that] provide different 

products, as here, there is a threshold question whether the 

companies are indeed similarly situated for constitutional 

purposes"); Rbcky Mountain, 730 F. 3d at 1084-94 (analyzing ethanol 

and petroleum separately because "[c]rude oil presents different 

climate challenges from ethanol and other biofuels [if a 

state] is to successfully [counter] a trend towards increased GHG 

output and rising world temperatures, it cannot ignore the real 

factors behind GHG emissions"); State Intervenors' Reply to Mot. 

Dismiss 8-9 (" [i] n the transportation fuel context, courts have 

traditionally considered ethanol to compete with ethanol and 

Page 12 - OPINION AND ORDER 
petroleum to compete with petroleum") (collecting cases) . 10 Thus, 

to the extent they phrase it broadly to encompass both fuels, 

plaintiffs' claim fails at the pleadings level. 

In any event, the fundamental premise of plaintiffs' claim is 

that the only fuels benefitting from the Oregon Program originate 

in Oregon. Plaintiffs therefore ignore significant segments of the 

market and instead ask this Court to assume that the pertinent 

comparison consists of Oregon biofuels, 11 on the one hand, and outof-state petroleum and Midwest ethanol, on the other. See, e.g., 

Pls.' Resp. to Mots. 12. The Ninth Circuit, however, expressly 

rejected this attempt at "selective comparison, which excludes 

relevant [competing] fuel pathways" and held that discrimination 

10 Although defendants and State Intervenors raise this issue 

as a basis for dismissal, plaintiffs respond solely by pointing 

to, and misquoting, the complaint's allegations. Pls.' Resp. to 

Mots. 17 n.9 (citing Compl. ~58). This is especially problematic 

given that compliance with the Oregon Program can be achieved 

exclusively through the purchase of credits, such that nothing 

precludes plaintiffs from continuing to produce and import 

diesel/petroleum in lieu of fuels with lower carbon intensities. 

See Defs.' Reply to Mot. Dismiss Ex. 2, at 8 ("the low carbon 

fuel standards would not mandate the use of any specific fuel"); 

Defs.' Reply to Mot. Dismiss Ex. 3, at 1 ("[t]o meet the [annual 

clean fuel] standards, regulated parties would select the 

strategy that works best for them [which could mean merely] 

purchasing clean fuel credits from providers of clean fuels") 

11 Biofuels include ethanol and biodiesel; nevertheless, the 

Court's analysis focuses exclusively on ethanol, as plaintiffs 

fail to allege any facts concerning biodiesel produced either 

inside or outside of Oregon, beyond observing that Oregon 

biodiesel "already meet[s] the proposed average annual carbon 

intensity." Compl. ~ 58; see also Or. Admin. R. 340-253-8040 

(Table 4) (all biodiesels have average carbon intensities below 

the annual fuel standard) . 

Page 13 - OPINION AND ORDER 
claims, whether premised on ethanol or petroleum, must be viewed 

"in context of the full market." Rocky Mountain, 730 F.3d at 1088-

90, 1099. 

Like the LCFS, the Oregon Program is not facially 

discriminatory because it distinguishes among fuels based on 

lifecycle GHG emissions, not origin or destination. In fact, the 

Oregon Program assigns twelve out-of-state ethanol pathways carbon 

intensities lower than the value plaintiffs' allege confers 

discriminatory benefits. Id. at 1089-96; Or. Admin. R. 340-253-8030 

(Table 3); see also Compl. ':!! 70 (recognizing that an ethanol 

produced in California obtains the same benefits under the Oregon 

Program as those produced in Oregon). These twelve lower pathways 

represent biofuels from outside of Oregon; seven are expressly 

identified as from California and Brazil, and the remaining five 

correspond to ethanols .from the Midwest. Or. Admin. R. 340-253-8030 

(Table 3); see also Rocky Mountain, 730 F.3d at 1084, 1090 ("the 

lowest ethanol carbon intensity values, providing the most 

beneficial market position, have been for pathways from the Midwest 

and Brazil"). As such, the Oregon Program does not facially 

discriminate against out-of-state ethanol. 

Assuming that biofuels and petroleum compete in the same 

market, the fact that the Oregon Program assigns lower carbonintensity values to in-state and out-of-state biofuels than to 

petroleum is not indicative of discrimination. Petroleum's higher 

carbon intensity values exist for a legitimate, nondiscriminatory 

Page 14 - OPINION AND ORDER 
reason: 

[c]orn and sugarcane absorb carbon dioxide as they grow, 

offsetting emissions released when ethanol is burned. By 

contrast, the carbon in crude oil makes a one-way trip 

from the Earth's crust to the atmosphere. For crude oil 

and its derivatives, emissions from combustion are 

largely fixed, but emissions from production vary 

significantly. As older, easily accessible sources of 

crude are exhausted, they are replaced by newer sources 

that require more energy to extract and refine, yielding 

a higher carbon intensity than conventional crude oil. As 

extraction becomes more difficult, emissions from crude 

oil will only increase, but [the state] expects that 

fuels with carbon intensity values fifty to eighty 

percent lower than gasoline will be needed to meet its 

emissions-reduction targets. No matter how efficiently 

crude oil is extracted and refined, it cannot supply this 

level of reduction. To meet [the state's] goals, the 

development and use of alternative fuels must be 

encouraged. 

Rocky Mountain, 730 F.3d at 1084-85. 

Moreover, it is undisputed that Oregon does not produce any 

petroleum in-state. Pls.' Resp. to Mots. 17-18 (citing Compl. ~~ 

57-58); see also Exxon Corp. v. Governor of Md., 437 U.S. 117, 125, 

reh'g denied, 439 U.S. 884 (1978) (because the state's "entire 

gasoline supply flows in interstate commerce [as] there are no 

local producers or refiners, such claims of disparate treatment 

between interstate and local commerce would be meri tless"); see 

also Rocky Mountain, 7 30 F. 3d at 108 9 ("a regulation is not 

facially discriminatory simply because it af.fects in-state and 

out-of-state interests unequally"). Under Rocky Mountain and Exxon 

Corp .. , facial discrimination against out-of-state petroleum would 

not transpire even if it were ultimately displaced by,biofuels in 

the Oregon market because "successfully promot [ing] low-carbonPage 15 - OPINION AND ORDER 
intensity fuels" requires the consideration of "factors [that] bear 

on the reality of GHG emissions," including "location, but only to 

the extent that location affects the actual GHG emissions 

attributable to a default pathway." Rocky Mountain, 730 F.3d at 

1089-93. 

Finally, the cases plaintiffs rely on are distinguishable. See 

Pls.' Resp. to Mots. 16-17 (citing Bacchus Imps., Ltd. v. Dias, 468 

U.S. 263 (1984); Hunt v. Wash. State Apple Adver. Comm'n, 432 U.S. 

333 (1977); New Energy Co. of Ind. v. Limbach, 486 U.S. 269 

(1988)). Two of these cases focused primarily on non-facial 

discrimination. See, e.g., Bacchus, 468 U.S. at 268-73 (observing 

"that the tax exemption here at issue seems clearly to discriminate 

on its face against interstate commerce" but ultimately basing its 

ruling on the statute's purpose and effect); Hunt, 432 U.S. at 350-

52 (describing the challenged statute's facial neutrality and 

instead striking it down due to its discriminatory effect). 

Regardless, the law invalidated in Bacchus limited the state's 

liquor excise tax exemption to two products manufactured 

exclusively in-state. Bacchus, 468 U.S. at 265-66. In contrast, 

under the Oregon Program, both in-state and out-of-state products 

can earn, and have earned, lower carbon intensity values, and 

regulated parties are not required to import or manufacture any 

specific fuel in order to achieve compliance. See Rocky Mountain, 

730 F. 3d at 1100 (distinguishing Bacchus in relation to the 

plaintiffs' petroleum-based discriminatory purpose claim). 

Page 16 - OPINION AND ORDER 

'i 
Hunt and New Energy are similarly distinct. Plaintiffs cite to 

these cases for the proposition that an otherwise-unconstitutional 

statute is not saved because it favors certain out-of-state 

products in addition to in-state products. Pls.' Resp. to Mots. 16. 

Unlike the Oregon Program, the state laws challenged in Hunt and 

New Energy were not the most beneficial towards out-of-state 

products. Hunt, 432 U.S. at 350-52; New Energy, 486 U.S. at 271-75; 

see also Rocky Mountain, 730 F.3d. at 1092 (distinguishing Hunt in 

relation to the plaintiffs' ethanol-based facial discrimination 

claim). Further, unlike the plaintiffs in Hunt, plaintiffs here 

identify no competitive and economic advantages they earned and 

that the Oregon Program eliminates. Indeed, on its face, the Oregon 

Program rewards all investment in innovative fuel production, 

irrespective of where that innovation occurs. Defendants' and 

defendant-intervenors' motions are granted as to plaintiffs' facial 

discrimination claim. 

B. Discriminatory Purpose 

Plaintiffs contend that the Oregon Program "was enacted to 

[favor] Oregon's 'home-grown' biofuels industry against the 

petroleum and ethanol industries of other states." Pls.' Resp. to 

Mots. 8 (citing Compl. '!['![ 71-84). Plaintiffs cite to statements 

made by state lawmakers, as well as DEQ committee members and 

officials, to support their assertion of discriminatory purpose. 

Id. at 8-11. 

Plaintiffs' claim fails for three reasons. First, plaintiffs 

Page 17 -OPINION AND ORDER 
ignore the actual stated purpose of the Oregon Program, which is to 

~reduce Oregon's contribution to the global levels of [GHG] 

emissions and the impacts of those emissions in Oregon" by 

~reduc[ing] the amount of lifecycle [GHG] emissions per unit of 

energy by a minimum of 10 percent below 2010 levels over a 10-year 

period." Or. Admin. R. 340-253-0000(1)-(3); see also Rocky 

Mountain, 730 F.3d at 1098 (court ~will assume that the objectives 

arti6ulated by the legislature are actual purposes of the statute, 

unless an examination of the circumstances forces [it] to conclude 

that they could not have been a goal of the legislation") (citation 

and internal quotations omitted); Perry v. Commerce Loan Co., 383 

U.S. 392, 400 (1966) (~[t]here is, of course, no more persuasive 

evidence of the purpose of a statute than the words by which the 

legislature undertook to give expression to its wishes"). 

Plaintiffs also ignore that the metric by which GHG emissions are 

measured applies evenhandedly; the dispositive inquiry is a fuel's 

carbon intensity, which correlates to the fuel's contribution to 

climate change, not its origin. Rocky Mountain, 730 F.3d at 1089-

90. In other words, the purpose and design of the Oregon Program 

are nondiscriminatory on their face. 

Second, the comments plaintiffs rely on are provided out of 

context. When read in their entirety, the documents in which these 

remarks appear reinforce that the purpose of the Oregon Program is 

to reduce GHG emissions. Compare Compl. <J[<J[ 71-84 (excerpted 

comments), with Defs.' Reply to Mot. Dismiss Exs. 1-7 (comments 

Page 18 - OPINION AND ORDER 
provided in context) . In any event, the hope of state officials 

that, in effectuating the legitimate goal of lowering GHG 

emissions, the Oregon Program benefits the local economy is 

insufficient to evince a discriminatory purpose. See Valley Bank of 

Nev. v. Plus Sys., Inc., 914 F.2d 1186,1193-96 (9th Cir. 1990) 

(regulation that "advances . . legitimate state interests" and 

"applies evenhandedly certainly passes muster under the commerce 

clause"; the "predictable concern" from state politicians for their 

own residents "does not rebut the evenhandedness of the 

legislation's plain language"). 

Third, the plaintiffs ·in Rocky Mountain based their 

discriminatory purpose claim on similar, isolated comments made by 

California lawmakers. Rocky Mountain, 730 F.3d at 1089-1101; see 

also Defs.' Reply to Mot. Dismiss 11-12 n. 4 (summarizing comparable 

statements made by California officials highlighting the LCFS' 

benefits to in-state industries) (citations omitted). In holding 

that the LCFS did not have a discriminatory purpose, the Ninth 

Circuit explicitly acknowledged the "few quotes from an expansive 

record" cited by plaintiffs but nonetheless held that they "do not 

plausibly relate to a discriminatory design and are 'easily 

understood, in context, as economic defense of a [regulation] 

genuinely proposed for environmental reasons.'" Rocky Mountain, 730 

F.3d at 1100 n.13 (quoting Minnesota v. Clover Leaf Creamery, Co., 

449 U.S. 456, 463 n.7 (1981)). As discussed herein, any claim of a 

protectionist purpose is belied by the fact that the Oregon Program 

Page 19 - OPINION AND ORDER 
provides advantages, in terms of lower carbon intensity values, to 

numerous out-of-state fuels. See, e.g., Or. Admin. R. 340-253-8030 

(Table 3). Defendants' and defendant-intervenors' motions are 

granted as to plaintiffs' discriminatory purpose claim. 

C. Discriminatory Effect 

Plaintiffs allege that the Oregon Program creates a 

"'commercial disadvantage' for petroleum and ethanol from outside 

Oregon [by] requir [ing] regulated parties to comply with the 

standard for carbon intensity, and [assigning] lower carbonintensity values to Oregon ethanol and other biofuels than to 

petroleum, and lower carbon-intensity values to Oregon ethanol than 

to identical Midwest ethanol." Pls.' Resp. to Mots. 13 (citing 

Compl. ~~ 55-57 and quoting New Energy, 486 U.S. at 274) . 12 

As a preliminary matter, plaintiffs' base their opposition on 

the wrong standard. Whether actual evidence of differential 

treatment amongst in-state and out-of-state interests exists, as 

opposed to a commercial disadvantage, is the critical question. See 

Black Star, 60 0 F. 3d at 12 32 (" [ c] ourts examining a 'practical 

effect' challenge must be reluctant to invalidate a state statutory 

12 In response to defendants' ripeness argument, which the 

Court does not find persuasive given the Oregon Program's 

imminent start date and the hardship that would result to the 

parties from withholding a decision, plaintiffs contend that "the 

question of the Oregon Program's effects is already clear"; yet, 

in other portions of their brief, plaintiffs argue the effects 

are unknown and that a "motion to dismiss in not an appropriate 

mechanism to test whether a party will ultimately prove facts 

underlying its well-pleaded claims." Compare Pls.' Resp. to Mots. 

14, with id. at 31, 34. 

Page 20 - OPINION AND ORDER 
scheme . . simply because it might turn out down the road to be 

at odds with our constitutional prohibition against state laws that 

discriminate against Interstate Commerce [especially] where neither 

facial economic discrimination nor improper purpose is an issue"); 

see also New Energy, 486 U.S. at 274-76 (discrimination was 

"patent" such that an analysis of the statute's discriminatory 

effect was not necessary) . As a result, to survive a motion to 

dismiss, a plaintiff must allege more than the existence of a 

commercial disadvantage, such as facts creating a reasonable 

inference that the challenged law has differing effects on 

similarly situated in-state and out-of-state entities. 

Plaintiffs have not done so here; their only pleadings 

pertaining to this subject conclude that the Oregon Program "will 

have the intended discriminatory effect" due to its discriminatory 

design. Pls.' Resp. to Mots. 13. Yet the purported discriminatory 

design that plaintiffs object to generally required regulated 

parties to reduce the lifecycle GHG emissions of their fuels. See 

Compl. <[<[ 55-58 (gasoline and "diesel importers would need to 

replace existing sources [with fuels that have] lower calculated 

carbon intensities or purchase credits from other parties to meet 

their annual average carbon intensity requirements") 

Additionally, the essential tenants of plaintiffs' 

discriminatory effects claim are undermined by the plain language 

of the Oregon Program and Ninth Circuit precedent. The definition 

of a regulated party does not depend on the origin of the fuel. Or. 

Page 21 - OPINION AND ORDER 
Admin. R. 340-253-0100(1). Likewise, the Oregon Program "does not 

base its treatment on a fuel's origin but on its carbon intensity." 

Rocky Mountain, 730 F.3d at 1089. As addressed in section I(A), the 

Oregon Program also does not grant preferential treatment to instate biofuels over out-of-state petroleum and Midwest ethanol. 

Whatever effects the Oregon Program may ultimately have on Oregon's 

biofuels market, there are no plausible allegations demonstrating 

that out-of-state producers will be commercially disadvantaged or 

considerably burdened, as some of their biofuels are the most 

desirable from a carbon intensity standpoint and the Oregon Program 

mandates neither the use of any particular fuel nor a specific 

carbon intensity or origin. Defendants' and defendant-intervenors' 

motions are granted as to plaintiffs' first claim. 

II. Second Claim: Extraterritorial Legislation 

Plaintiffs next allege that the Oregon Program "violates the 

United States Constitution by regulating interstate and foreign 

commerce that occurs wholly outside Oregon." Pls.' Resp. to Mots. 

19 (citing Compl. cn:cn: 121-30). 

The constitution, pursuant to either the dormant Commerce 

Clause or principles of structural federalism embodied therein, 

proscribes any "statute that directly controls commerce occurring 

wholly outside the boundaries of a State." Healy v. Beer Inst., 491 

U.S. 324, 336 (1989); World-Wide Volkswagen Corp. v. Woodson, 444 

U.S. 286, 293 (1980). The extraterritoriality principle is rarely 

utilized and has been confined to three circumstances: price 

Pag~ 22 - OPINION AND ORDER 
control statutes, statutes that lirik prices paid in-state with 

those paid out-of-state, and statutes that discriminate against 

out-of-state commerce. Rocky Mountain, 730 F.3d at 1101-03. 

Plaintiffs paint their current extraterritorial legislation 

claim as discrete from the claim that was reviewed and rejected by 

the Ninth Circuit because it is independently based on principles 

of interstate federalism. Nevertheless, plaintiffs recognize that, 

irrespective of its constitutional basis, any such claim is 

necessarily contingent upon a finding that the "Oregon Program 

regulates and attempts to control conduct that occurs in other 

states," as both "the Commerce Clause [and] principles of 

structural federalism [exist to] prohibit states from engaging in 

ext~aterritorial regulation." Pls.' Resp. to Mots. 19-21. 

Accordingly, because the Ninth Circuit expressly held that the 

analogous LCFS "does not control conduct wholly outside the state," 

and is not "an impermissible extraterritorial regulation," 

plaintiffs' claim fails as a matter of law. Rocky Mountain, 730 

F.3d at 1103-07; see also Rocky Mountain II, 2014 WL 7004725 at 

*13-14 (plaintiffs' proposed amendment i.e. to add a claim 

alleging that the LCFS was unconstitutional under "principles of 

interstate federalism" - was barred by the law of the case doctrine 

because, per plaintiffs own admission, any such claim was premised 

on the fact that a state "may not apply its laws to commerce that 

takes place wholly outside of [its] borders, or seek to control 

commerce in other States") (citations and internal quotations and 

Page 23 - OPINION AND ORDER 
ellipses omitted); Am. Fuels, 2015 WL 4872639 at *9-12 (dismissing, 

without leave to amend, plaintiffs' extraterritorial regulation 

claim based on "principles of interstate federalism"). Defendants' 

and defendant-intervenors' motions are granted as to plaintiffs' 

second claim. 

III. Third Claim: Express Preemption 

Plaintiffs' also allege the Oregon Program is expressly 

preempted by section 211 (c) (4) (A) (i) of the CAA and the RFGR, which 

found that "no control or prohibition relating to the GHG methane 

is necessary for transportation fuels." Compl. ~~ 131-36. 

The Supremacy Clause gives Congress the power to preempt state 

law by, amongst other avenues, "withdraw[ing] specified powers from 

the States by enacting a statute containing an express preemption 

provision." Arizona v. United States, 132 S.Ct. 2492, 2500-01 

(2012) (citation omitted). When a federal act contains an express 

preemption provision, the court's primary task is to "identify the 

domain expressly pre-empted by that language." Medtronic, Inc. v. 

Lohr, 518 U.S. 470, 484 (1996). The court "focus[es] on the plain 

wording of the clause, which necessarily contains the best evidence 

of Congress' pre-emptive intent." CSX Transp., Inc. v. Easterwood, 

507 u.s. 658, 664 (1993). 

The CAA authorizes the EPA to regulate fuels and their 

emissions. 42 U.S.C. § 7545. Under Section 211(c) (1), the EPA may 

regulate a fuel if that fuel or its emission product "causes, or 

contributes, to air pollution 

Page 24 - OPINION AND ORDER 

that may reasonably be 
anticipated to endanger the public health or welfare." 42 U.S.C. § 

7545 (c) (1). The CAA also includes an express preemption provision 

under section 211 (c) (4): 

no State (or political subdivision thereof) may prescribe 

or attempt to enforce, for purposes of motor vehicle 

emission control, any control or prohibition respecting 

any characteristic or component of a fuel or fuel 

additive in a motor vehicle or motor vehicle engine -

(i) if the [EPA] has found that no control or prohibition 

of the characteristic or component of a fuel or fuel 

additive under paragraph (1) is necessary and has 

published his finding in the Federal Register, or 

(ii) if the [EPA] has prescribed under paragraph (1) a 

control or prohibition applicable to such characteristic 

or component of a fuel or fuel additive, unless State 

prohibition or control is identical to the prohibition or 

control prescribed by the [EPA] . 

42 U.S.C. § 7545(c)(4)(A). Thus, subsection (ii), which is not at 

issue in this case, is preemption by affirmative, positive EPA 

regulation, whereas subsection ( i) is preemption by affirmative-, 

negative EPA regulation. See 62 Fed. Reg. 10,690, 10,693 

(" [ s] ection 211 (c) ( 4) applies only where EPA has affirmatively 

decided to regulate a particular fuel characteristic or component, 

or has affirmatively found that no such regulation is necessary"). 

Section 211 (k) of the CAA, in turn, requires the EPA to 

control fuel to achieve the "greatest reduction in emissions of 

ozone forming volatile organic compounds through the 

reformulation of conventional gasoline." 42 U.S.C. § 7545 (k) (1) (A). 

In 1994, the EPA issued the RFGR, the purpose of which is "to 

improve air quality by requiring that gasoline be reformulated to 

Page 25 - OPINION AND ORDER 
reduce motor vehicle emissions of toxic and tropospheric 

ozone-forming compounds, as prescribed by section 211 (k) (1)." 59 

Fed. Reg. 7716. To meet the obligations of section 211(k) (1), the 

RFGR positively and exclusively regulates ozone-forming volatile· 

organic compounds ( "VOC") , such that states are expressly preempted 

from setting different VOC restrictions. Id. at 7722-23, 7809; 42 

U.S.C. § 7545(c) (4) (A) (ii). The EPA concluded, in plaintiffs' own 

words, that methane was "excluded from regulation under Sections 

211(c) and 211(k)" because it did not pose a sufficient threat to 

the public health or welfare. Pls.' Resp. to Mots. 23 (citations 

omitted) . Specifically, the EPA found that "methane would be 

excluded from the definition of VOC on the basis of its low 

reactivity." 59 Fed. Reg. at 7722-23. 

As such, the plain language of the RFGR did not affirmatively 

find that no control or prohibition of methane was necessary. 

Rather, the EPA determined only that methane was not an 

ozone-forming VOC under section 211(k) and therefore not subject to 

regulation under section 211(c) (1). In other words, the EPA's sole 

finding relating to preemption was under section 211 (c) (4) (A) (ii) -

i.e. that its standard for ozone-forming VOCs should preempt nonidentical state regulation. See 59 Fed. Reg. at 7809 ("dissimilar 

State [VOC] controls [are] preempted"). Because the RFGR's limited 

discussion of methane says nothing about the need for an 

affirmative, negative regulation pursuant to section 

211 (c) (4) (A) (i), this fuel component is not covered under the CAA' s 

Page 26 - OPINION AND ORDER 
express preemption provision. 

This reading is consistent with the recognition that air 

pollution prevention is within the states' traditional authority -

for which "there is a general presumption against preemption" 

absent a "clear and manifest" expression of intent by Congress. 

Oxygenated Fuels Ass'n, Inc. v. Davis, 331 F.3d 665, 668-73 (9th 

Cir. 2003) (citations and internal quotations omitted); see also 40 

C.F.R. § 80.1 ("[n]othing in this part is intended to preempt the 

ability of State or local governments to control or prohibit any 

fuel or additive for use in motor vehicles and motor vehicle 

engines which is not explicitly regulated"); 62 Fed. Reg. at 10,693 

("as a policy matter, EPA's decision to regulate [certain fuel 

components in reformulated gasoline] areas did not encompass a 

determination that states should not or need not regulate that 

characteristic outside of those areas"). The CAA's "sweeping and 

explicit" savings clause is further textual evidence that where, as 

here, the EPA has not made an affirmative finding that no control 

is necessary, the states retain authority to regulate air 

pollutants. Exxon Mobil Corp. v. Envtl. Prot. Agency, 217 F. 3d 

1246, 1255 (9th Cir. 2000) (citing 42 U.S.C. § 7416). 

Moreover, as State Intervenors observe, the EPA has spoken 

unequivocally when it intends to invoke section 211 (c) (4) (A) (i). 

State Intervenors' Mot. Dismiss 16. For instance, in relation to 

fuel oxygen content, the EPA "propos[ed] to issue a finding that 

'no control or prohibition 

Page 27 - OPINION AND ORDER 

[is] necessary' under section 
211 (c) (4) (A) (i)," with the "effect [being] to preempt state 

controls." 57 Fed. Reg. 47,849, 47,849. In contrast, the RFGR 

contains no such language concerning methane, or any other 

component of fuel, and instead only speaks to VOC controls. 59 Fed. 

Reg. at 7809. 

In sum, plaintiffs erroneously equate the EPA's finding that 

methane is not affirmatively, positively preempted by the RFGR with 

an affirmative, negative determination that no control or 

prohibition of methane is necessary. 13 In so doing, plaintiffs 

ignore the possibility, embodied in the plain language of the 

statute, that the EPA may decline to make and publish the finding 

required by section 211 (c) ( 4) (A) ( i) , thereby allowing states to 

regulate that fuel characteristic or component as they choose. 

Defendants' and defendant-intervenors' motions are granted as to 

plaintiffs' third claim. 

13 The EPA made an Endangerment Finding in 2009 that methane 

is a GHG which "may reasonably be anticipated to endanger public 

health or welfare." 74 Fed. Reg. 66,496, 66,497. This is 

essentially the same standard that triggers the EPA's authority 

to regulate under section 211(c)(1). 42 U.S.C. § 7545(c)(1). 

Contrary to plaintiffs' assertion, the fact that the Endangerment 

Finding "was issued under Section 202 of the CAA, which governs 

vehicle standards- not Section 211(c), which governs fuel 

standards," does not render it irrelevant. Pls.' Resp. to Mots. 

27 (emphasis removed). The Court nonetheless agrees with 

plaintiffs that the Endangerment Finding does not amend the RFGR; 

rather, the Endangerment Finding speaks to the hazards of methane 

that have been discovered over the past fifteen years such that, 

even if the EPA had found it unnecessary to control emissions 

from this component in 1994, it subsequently reversed course in 

light of newfound scientific evidence. 79 Fed. Reg. 1430, 1455. 

Page 28 - OPINION AND ORDER 
IV. Fourth Claim: Conflict Preemption 

Lastly, plaintiffs allege that the "Oregon Program conflicts 

with and stands as an obstacle to the purposes and goals of the 

[EISA, RFS, and] Energy Policy Action of 2005" because it "is 

designed to close Oregon as a market for certain renewable fuels 

(in particular, certain forms of corn ethanol) produced in existing 

refineries necessary to meet national renewable fuel standards set 

by Congress." Compl. <[<[ 137-45. 

"[S]tate laws are preempted when they conflict with federal 

law," including instances "where compliance with both federal and 

state regulations is a physical impossibility [or] where the 

challenged state law stands as an obstacle to the accomplishment 

and execution of the full purposes and objectives of Congress." 

Arizona, 132 S.Ct. at 2501 (citations and internal quotations 

omitted) . "What is a sufficient obstacle is a matter of judgment, 

to be informed by examining the federal statute as a whole and 

identifying its purpose and intended effects." Id. (citation and 

internal quotations omitted) 

Section 211 ( o) of the CAA sets forth the RFS, which was 

modified in 2007 by the EISA. 42 U.S.C. § 7545(o). The purpose of 

the RFS is 

to ensure that transportation fuel sold or introduced 

into commerce in the United States (except in 

noncontiguous States or territories), on an annual 

average basis, contains at least the applicable volume of 

renewable fuel, advanced biofuel, cellulosic biofuel, and 

biomass-based diesel, determined in accordance with 

subparagraph (B) and, in th~ case of any such renewable 

Page 29 - OPINION AND ORDER 
fuel produced from new facilities that commence 

construction after December 19, 2007, achieves at least 

a 20 percent reduction in lifecycle greenhouse gas 

emissions compared to baseline lifecycle greenhouse gas 

emissions. 

42 U.S.C. § 7545(o) (2) (A) (i) . 14 

As a threshold matter, plaintiffs' lack prudential standing as 

they do not contend to generate or sell the type of biofuel the 

Oregon Program allegedly penalizes, or that their interests are 

closely aligned with those whose rights are at issue. Critically, 

plaintiffs do not assert that they or any of their members own or 

sell fuel from exempted biofuel plants; plaintiffs also do not 

allege any hindrance to the exempted biofuel facilities' ability to 

protect their own interests. Pls.' Resp. to Mots. 35 (citing Compl. 

<JI<JI 8-10, 17-20); see also State Intervenors' Mot. Dismiss 20 

(noting plaintiffs "oppose[d] the very type of mandate [they] claim 

Congress created and with which [they] allege [the Oregon] Program 

conflicts," and that several ethanol "associations are plaintiffs 

in one of the consolidated Rocky Mountain cases") (citations 

omitted). Given these pleading deficiencies, in conjunction with 

plaintiffs' failure to point to any additional facts that might 

14 In opposing dismissal, plaintiffs cite to a different 

provision of the EISA, which does not concern the RFS, as 

defining the RFS' purpose. Compare Pls.' Resp. to Mots. 30 

(citing EISA§ 806, codified at 42 U.S.C. § 17285), with Compl. 

<JI<JI 104-05 (citing EISA § 202, codified at 42 U.S.C. § 

7545(o) (2)). Assuming its relevance to the Court's preemption 

analysis, that provision espouses many compatible goals, all of 

which relate to increasing the United States' reliance on 

"domestic renewable resources" and "increas[ing] [the] use of 

renewable energy." 42 U.S.C. § 17285. 

Page 30 - OPINION AND ORDER 
confer subject-matter jurisdiction, the Court concludes that the 

fourth claim is premised on the rights of non -partes - namely, 

those who produce qualifying renewable fuels in facilities 

constructed pre-December 2007. See Allen v. Wright, 468 U.S. 737, 

7 51 ( 198 4) (the court lacks subject-matter jurisdiction, due to 

prudential limitations, where a plaintiff "rais[es] another 

person's legal rights"); see also Elk Grove Unified School Dist. v. 

Newdow, 542 U.S. 1, 15 n.7 (2004) (prudential standing limitations 

exist to ensure "that the most effective advocate of the rights at 

issue is present to champion them") 

quotations omitted). 

(citations and internal 

Irrespective of subject-matter jurisdiction, plaintiffs' 

allegations are implausible in four respects. First, plaintiffs 

maintain "that Section 2ll(o) was enacted to ensure a continued 

market for ethanol from existing ethanol plants." Pls.i Resp. to 

Mots. 30-31. Yet the expressly stated purpose and intended effects 

of the RFS is to increase the United States' reliance on renewable 

fuel sources and reduce GHG emissions. 42 u.s.c. § 

7545 (o) (2) (A) (i). Because section 211 (o) (2) (A) (i) makes no mention 

of ensuring a market for then-existing facilities, the fact that 

Congress elected to exempt such facilities from the requirement 

that certain fuels achieve a 20% reduction in lifecycle GHG 

emissions does not confer upon them a preferred or dominant status. 

Contrary to plaintiffs' assertion, the volume requirements for 

renewable fuel set in section 211 (o) (2) (B) do not include a minimum 

Page 31 - OPINION AND ORDER 
amount that must be met with corn ethanol generally, let alone from 

corn ethanol produced in facilities constructed before December 

2007; this statute simply articulates applicable volumes of 

renewable fuel required for the calendar years of 2006 through 

2011. 42 u.s.c. § 7545 (o) (2) (B); see also 42 u.s.c. § 

7545 (o) (1) (B) (i) ("advanced biofuel," the use of which is 

encouraged under the RFS, "means renewable fuel, other than ethanol 

derived from corn starch"). The Oregon Program is also not an EPA 

regulation, such that the anti-geographic restriction provision 

embodied in section 211 (o) (2) (A) (iii) is not implicated. See 42 

U.S.C. § 7545(o) (2) (A) (iii) (speaking only to the EPA's ability to 

issue "regulations under clause (i) [that] restrict 

geographic areas in which renewable fuel may be used"). 

Second, both the EISA's savings clause and legislative history 

reflect that Congress did not intend to preempt state regulation of 

transportation fuels. As part of its RFS rule-making, the EPA 

rejected one commenter's suggestion that the RFS should "preempt 

state programs designed to address carbon content and lifecycle 

analysis of fuels," including "state low carbon fuel standards," 

explaining that "[i]ssues associated with State LCFS programs . 

are not germane to the final RFS program." State Intervenors' 

First Req. Judicial Notice Ex. G, at 6-7 15 ; see also id. at 4 

15 Because State Intervenors did not numeralize their 

exhibits, the Court refers to the page numbers assigned in the 

docket. 

Page 32 - OPINION AND ORDER 
("these [RFS] thresholds do not constitute a specific control on 

[GHGs] for transportation fuels (such as a low carbon fuel 

standard)"). In fact, the EPA saw no conflict between state low 

carbon fuel standards and the RFS. See id. at 7 ("where possible 

[the EPA has] attempted to structure the RF[S] program so as to be 

compatible with existing State LC[F]S programs, including 

coordination on lifecycle modeling"). 

The EISA's savings clause, in turn, specifies that "nothing in 

the amendments made by this title to section 211(o) of the [CAA] 

shall be construed as superseding, or limiting, any more 

environmentally protective requirement under any other 

provision of State or Federal law or regulation." 16 EISA§ 204 (b), 

Pub. L. No. 110-140. While plaintiffs are correct that a savings 

clause does not necessarily bar conflict preemption principles, 

this case presents no actual discord between the EISA, RFS, and 

Oregon Program. See Nat'l Audubon Soc'y, Inc. v. Davis, 307 F.3d 

835, 854 (9th Cir. 2002) (as amended) (where a savings clause 

16 Plaintiffs' assertion that the Oregon Program is "[not] 

more environmentally protective" because it "may instead increase 

GHG emissions (or at the very least hide them)" is both 

unavailing and insufficient to preclude application of the EISA's 

savings clause. Pls.' Resp. to Mots. 34; see also Rocky Mountain, 

730 F.3d at 1082 (describing the LCFS as "starting to work as 

intended," while noting that "[t]here is growing scientific and 

public consensus that the climate is warming and that this 

warming is to some degree caused by anthropogenic GHG emissions") 

(citations omitted). This is especially true in light of the fact 

that they do not make any allegations regarding this issue in the 

complaint. See generally Compl. 

Page 33 - OPINION AND ORDER 
exists, state law is preempted only "to the extent that actual 

conflict persists between state and federal policies"); see also 

State ex rel. Stenehjem v. FreeEats.com, Inc;, 712 N.W.2d 828, 841 

(N.D.), cert. denied, 549 U.S. 953 (2006) (distinguishing Geier v. 

Am. Honda Motor Co., Inc., 529 U.S. 861 (2000), and other conflict 

preemption cases, which involved "inconsistent and conflicting 

preemption provisions and savings clauses within the federal 

statutes," from one in which "an express provision explicitly 

provid[es] that nothing in the federal statute shall preempt any 

State law on the precise subject matter involved in the case") 

(internal quotations omitted). 

Third, as addressed in section I, the Oregon Program neither 

"penalize[s] ethanol produced in existing [Midwest] ethanol plants" 

nor renders these plants "[un]able to export their fuels to 

Oregon." Pls.' Resp. to Mots. 30. Aside from the fact that 

plaintiffs' complaint is silent as to the carbon intensities of the 

ethanols generated from these unspecified, exempted plants, 

Midwestern producers have obtained some of the most favorable 

treatment under the Oregon Program. 

Fourth, the compliance scenarios cited by plaintiffs in 

opposing dismissal do not "predic[t] Oregon's ending its 

importation of fuels from existing Midwestern ethanol plants." 

Pls.' Resp. to Mots. 30. As a preliminary matter, these scenarios 

are neither predictions nor do they provide any evidence of future 

market conditions. See State Intervenors' Second Req. Judicial 

Page 34 - OPINION AND ORDER 
Notice Ex. I, at 3 (compliance scenarios "should not be confused 

with IFC market forecasts") Rather, ongoing·market conditions and 

fuel availability, amongst other factors, will determine how 

compliance occurs. See, e.g., Def.'s Reply to Mot. Dismiss Ex. 5, 

"' 

at 17. Regardless, the compliance scenarios merely demonstrate that 

one category of ethanol, labeled "Corn, MW," may drop off in 2019, 

after an initial increase in 2017 and 2018. State Intervenors' 

Second Req. Judicial Notice Ex. I, at 23. This category of ethanol, 

however, is defined as corn ethanol from "conventional processes," 

such that it possesses a higher average carbon intensity. Id. at 

13-15. Notably, this is not the only kind of corn ethanol produced 

by Midwestern plants. Or. Admin. R. 340-253-8030 (Table 3); Rocky 

Mountain, 730 F.3d at 1084; State Intervenors' Second Req. Judicial 

Notice Ex. L, at 7, 11. Thus, these scenarios show conventional, 

higher-carbon corn ethanol from the Midwest being replaced in 

Oregon's market by other types of corn ethanol, several of which 

are also produced in the Midwest, as well as some sugar cane-based 

fuels from Brazil. Given the actual tone and content of these 

scenarios, combined with the fact that compliance can be achieved 

exclusively through purchasing credits, plaintiffs' conclusion that 

the Oregon Program will shutter the state's market to Midwest 

ethanol is not entitled to the presumption of truthfulness. 

Defendants' and defendant-intervenors' motions are granted as to 

plaintiffs' fourth claim. 

Page 35 - OPINION AND ORDER 
CONCLUSION 

State Intervenors' first and second requests for judicial 

notice . (docs. 53, 68) are GRANTED .. Defendants' motion to dismiss 

(doc. 51), State Intervenors' motion to dismiss (doc. 52), and 

Conservation Intervenors' motion for judgment on the pleadings 

(doc. 54) are also GRANTED. Accordingly, the parties' requests for 

oral argument are DENIED as unnecessary. This case is DISMISSED. 

IT IS SO ORDER~ 

Dated thisCt~day of September 2015. 

Ann Aiken 

United States District Judge 

Page 36 - OPINION AND ORDER