-1- UNITED STAT ES DIS TRICT COURT F OR THE D ISTRIC T OF CO LU M BIA LG ELECTRONICS U.S.A., INC., P la in t if f, v. Ci vilAc ti on N o. 09 -2 29 7 ( JD B) United States DEP ARTMENT OF ENERGY, and S TEPHEN CHU, P HD., United States Secre tary of Energy, Defendan t.
M EM OR AN DU M OP IN ION Th e De pa rtme nt o f E ne rgy

(" DO E" ) h a s o rd e re d L G E le c tr on ic s U .S. A. , Inc . ( " L G" ) t o
remove the " Energy

Star" ener g y

eff iciency label fr om approxim ately 40,000 of its refr ige rators by J anuar y 20, 2010. Currently

befor e the Court is [3] L G' s motion for a pre liminary injunction th atwo u l d

al l o w i tt o re t ai nth e E n er gy S t ar l ab el o nth es e r ef

ri ger at o rs . L G a rgu es th at DO E 's actions violate the A dminist rative Proc edure Act, 5 U.S.C. § 551 et seq., the Ene rg y Policy and Conservation Ac t, 42 U.S.C. § 6291 et seq., and L G' s due proc ess rig hts. The Court hear d oral argument on the motion on J anuar y 11, 2010. Upon consider ation of the re levant leg al authorities, the par

ties' memoranda , the entire rec ord her ein, and f or the re asons discussed be low, the Court denies L G' s motion. BACK GR OUND I. St at ut or y Ba c kgr ound The Ene rg y

Policy and Conservation Act (" EPCA") e stablishes an ene rg y conser vation prog ram for

major household applianc es. EPCA, along with the National Ene rg y Conservation-2-

Pol ic y Ac t of 19 78 , g ra

nts DO E the a

uth or ity to r e g ulate the e ne rgy

e ff ic ie nc y of ho us e ho ld appliance s such as re frig erators and fr eezer s, and pre scribes minimum energy eff iciency standards f

or such a ppliances. See 42 U.S.C. § 6295. Fe d er al l aw al s o go v ern s th e n o w- u b i qu i t o u s E n er gy

S t ar l ab el i n g p ro gra m . T h e E n er gy Star p ro g ra

m, j ointly a dmi nis te re d b y

DO E a nd the Envir on me nta l Pr ote c tio n A g e nc y , s e e ks to "ide ntify and promote e nergy -ef

ficient produc ts and buildings . . . throug h voluntary labelingof . . . products and building s that meet the hig hest ene rg y conser vation standards." 42 U.S.C. § 6294a(a ). Manuf

actur ers whose products comply with cer tain ener g y

eff iciency standards ma

y enter into a licensingag ree ment with the g overnme nt to permit their qualifying pr oducts to car ry the Ener g y

Star label. See Def

s.' Opp' n to Pl.'s Mot. (" Def s.' Opp' n") [Docket Entry 10], Decl. of Catherin Z oi (" Z oi Decl." ), ¶ 6. For most refrig erators and fr eezer s to qualify for the E nergy

Star prog ram, they

must be at least 20% more ener g y

eff icient than the minimum efficie ncy standards se t by

law. See Depa rtment of Ene rg y , Energy Star Prog ram Require ments for Residential Ref rig erators and/or Fr eezer s (Aug . 3, 2007), at 3-4, a vailable at http:/ /www.ene rg y star.g ov/ia/partner s/product_spec s /prog ram_re qs/refr ig_pr og_req.pdf . Fe dera l regulations detail the testing c riteria that DOE uses to det erm in e th e ener gy

effi cie ncy

of r efri gerato rs a nd

freez ers . S ee 10 C. F.R . p t. 43 0, subp t B, app. A1. Pursuant to these regulations, a ref rig erator' s "[o]perational conditions" dur ing te sting -- such as the te mperature of the ref rig erator -- a

re supplied by

the so-ca lled AHAM-H RF-1- 1979 test (" HRF-1 te st"), a

proce dure initially

develope d by

the Association of H ome Appliance M an u fa ct ure rs . I d
. § 2
. 2
. Of re l ev an ce h er e, th e H R F- 1 t es tp ro v i d es th at , d uri n g en er gy eff iciency testing, " [a] utomatic ice make rs ar e to be inoper ative." See Pl.'s Me m. in Support ofThe ice maker ' s "f ill tube" is a small pipe that ca rries w ater

to a mold in the ice make r 1 wher e water is frozen into ice. T he fill tube heater ke eps the water fr om free zing in the fill tube. See McG rady

Dec l. at ¶ 6. The ic e eje ction heate r ensur es that the ice can be separ ated f rom the mold and ejec ted into a storag e ar ea of the ice maker. See id. at ¶ 7. -3- its Mot. ("Pl.'s Me m.") [Docket Entry 3], Ex hibit 7 (HRF-1 test) ¶ 7.4.2. II. F ac tu al B ac kgr ound This dispute conce rns the interpr etation of the H RF-1 test' s term " inoperative," a s applied to icemake rs on ce rtain L G " Fr ench D oor" ref rig erator models. Fr ench D oor re frig erators have a bottom drawer

fre ezer a nd double doors on top for f resh f ood, and they

offe r throug h-the-door ice a nd water service . See Pl.'s Me m., Decl. of Timothy McGra dy

(" McGra dy

Dec l.") , ¶¶ 4- 5. These r efr ige rators a

re the fastest g rowingseg ment of the re frig erator marke t. See Pl.'s Mem., Dec l. of Timothy

Kava naug h (" Kava

naug h Dec l.") , ¶ 5. F re nc h D oo r r e fr ig e rator s in c or po rate a se pa ra te ic e -m akin g a sse mbl y

wi thi n th e fr e sh food compa

rtment of the r efr ige rator. See Def s.' Opp' n, Dec l. of Michae l McCabe ( "Mc Cabe Dec l.") , ¶ 9. As the r efr ige rators' "f resh f ood compar

tment must be maintained above fre ezing temperatures, and the ice makingassembly within it m ust be maintained be low fre ezing temperatures," Fr ench D oor models use he ater s to function proper ly . I d. at ¶ 10. The pa rties' disag ree ment in this case ce nters ar ound how ene rg y usag e should be calc ulated for

two heate rs found in L G' s Fre nch Door ref rig erators: the "f

ill tube heater " a

nd the "ic e eje ction heate r." These c omponents consume sig nificant amounts of ener g y even when the 1 ref rig erator is not actively

making ice. Thus, whe ther the H RF-1 test' s require ment that the icemake r be " inoperative" dur ing te sting mea ns that the icema

ker is " power ed complete ly off," or that it is "power ed on, but not actively making ice," could deter mine whether

a re frig eratorThis dispute appare ntly arose over the temperature of the ref rig erators' ice stora g e bins 2 duringtesting, a

nd was unre lated to the par ties' prese nt disag ree ment. See Tra nscript of Or al Argument (" Tr." ), 57-58. -4- qualifies for

the Ener g y

Star label, or f

ails to meet eve n the statutory minimum ener g y

eff iciency sta nd ard s. In 2008, a dispute ar ose betwe en L G and DO E conc erningthe proc edure s L G was using to test the ener g y

eff iciency of ce rtain F renc h Door re frig erator models. In November of that 2 y ear , the two sides enter ed into an agree ment which deta iled how these r efr ige rator mode ls were to be tested. See Pl.'s Mem., Exhibi t 2 (L G-DO E 2008 Ag ree ment), ¶ 3. Spec ifically , the Ag ree ment provided that e nergy eff iciency tests of aff

ecte d ref rig erator models would be perf ormed using te sting proc edure s consistent with DOE' s interpre tation of the oper ating conditions specified in [the] HRF-1 [test] , which re quire that the ic e making sy stem of the re frig erator-fr eezer be disabled f

or purpose s of makingice but that all other sy stem components re main on during testing w ith the exception of the fill tube and ice ejec tion heater s, which may rema in off for

the purposes of

testing under this Ag ree ment subject to furthe r notice by DOE. I d. In the fa ll of 2009, DOE re ceive d repor ts from two laboratories which c oncluded that
cer tain L G re frig erators bear ing the Energy Star label did not meet the Ene rg y Star criter ia, and that some did not meet eve n the statutory minimum eff

iciency standards. Mc Cabe De cl. at ¶¶ 40 -4 1. Al tho ug h th e re c or d is larg e ly sil e nt a s to wh a t ha

pp e ne d n e xt, it

a pp e ars that L G wro te to DOE that it believe d these tests we re not pe rfor med ac cordingto the proce dures spe cified in the p art i e s ' 2 0 0 8 A g r e e m e n t . S e e P l
. ' s M e m . , E x h i b i t1 (N o v e mb e r 1 0 , 2 0 0 9 Le t t e r

f r o mD O E t o LG (" November

10 L etter" )), at 1 (ref

err ing to a

September 22, 2009 le tter fr om L G to DOE).DOE' s letter allowe d L G until November 25, 2009 to re move the Ene rg y Star label fr om 3 its a ff e c te d r e fr ig e rator

mod e ls a nd un til Ma rc h 9 , 2 01 0 to re mov e fr om c omm e rc e any mod e ls that did not meet the statutory minimum ener g y

eff iciency standards. See id. DOE has since extended these de adlines to J anuar y 20, 2010, and Mar ch 16, 2010, re spectively
. L G initially

also soug ht relief f

rom the prospe ctive application of DOE' s "modified" 4 (continued...) -5- On No ve mbe r 1 0, 20 09 , in

a le tte r t hat w ou ld e ve ntu a lly

pr omp t th is l aws uit , D OE wr ote to L G that th e a g e nc y

ha d c on c lud e d th a t " L G' s r e lia nc e on the te st p ro c e dure e xce pti on se t out in the [part ie s' No ve mbe r 2 00 8] A g re e me nt" -- a llo wi ngthe fi ll t ub e and ic e e je c tio n h e a te rs to
rema in off duringener g y

eff iciency testing - - " has g iven L G an unintende d advanta g e in the
mark e tpl a c e and

re su lte d in

signif ic ant u nd e rr e po rt ingof

the e ne rgy

c on sumpt ion

of L G m od e ls to b oth DO E a nd c on sume rs ." No ve mbe r 1 0 L e tte r a t 2. Th e le tte r c on tin

ue d: " c on sis te nt w ith the terms of the Ag ree ment, DOE is providingL G with notice that the a g ency is revokingthe
e xce pti on pr ov ide d in

. . . th e Ag re e me nt a

nd [is] r e qu ir ingL G t o f

oll owthe DO E t e st pr oc e dure ," wh ic h, a c c or din g to t he a g e nc y , w ou ld r e qu ir e the fi ll t ub e and ic e e je c tio n h e a te rs to
re ma in o n d

ur ingte sti ng . I d. DO E d e mand e d th a t L G r e mov e the En e rgy Sta r l a be l f ro m c e rt a in Fr ench D oor re frig erator models still within its possession, and that it notify reta ilers to remove the label f rom these r efr ige rators in their store s. I d. At oral a rgument, L G re prese nted that 3 approximately

40,000 ref

rig erators alre ady

in or on their wa

y to the U.S. market a

re a ffe cted. See Tr. at 12. After eff orts to resolve the dispute pr oved unsucc essful, L G filed suit on Dec ember 4, 2009. L G' s complaint seeks injunctive re lief as we ll as a dec laratory judgme nt that, inter alia, DOE' s November

10 letter orde ringL G to remove the Ener g y Star label fr om exi sting ref rig erators is arbitrar

y and ca pricious. Compl. at 35-36. L G filed a motion for a pre liminary 4(...continued) 4 testing c riteria. See Compl. at 35-36. L G has since voluntarily ag ree d to produce Fr ench D oor ref rig erator models that DOE a ppear s to ag ree will comply with the requisite Ene rg y Star standards. See Pl.'s Reply in Support of its Mot . (" Pl.'s Reply ") [Docket Entry 14], at 2. -6- injunction on Dece mber 9, 2009. The Court hear d oral a rgument on the motion on J anuar y 11, 2010. STA ND AR D O F RE VI EW A pre liminary

injunction is an ex traordina ry and dra stic remedy , one that should be g rante d only

when the movingparty , by a cle ar showing , car

ries the bur den of pe rsuasion. See Mazurek v. Ar

mstrong, 520 U .S. 968, 972 (1997); see a lso Munaf v. Ge ren, 128 S.Ct. 2207, 2219 (2008). To obta in a pre liminary injunction, the moving par ty must demonstrate (1) a substantial likelihood of success on the me rits, (2) that it would suffe r irre para ble har m without injunctive relief

, (3) that a

n injunction would not subst antially harm the de fenda

nts or other int e re ste d p art ie s ( ba lanc e of ha rm s) , a nd (4 ) t hat is su anc e of

the inj un c tio n is in t

he pu bli c interest. See Cha

plaincy of F ull Gospel Churches v. Eng land, 454 F.3d 290, 297 ( D.C. Cir. 2006); Cobell v. Norton, 391 F.3d 251, 258 ( D.C. Cir. 2004). A district court we ighingwhether to gr ant a pr eliminary

injunction must "' balanc e the streng ths of the re questing party ' s arguments in eac h of the four require d are as.' " Cha

plaincy of Full Gospel Churc hes, 454 F .3d at 297 (quoting City Fe d Fin. Corp. v. Of

fice of Thrift S u p erv i s i o n , 5 8 F. 3 d

7 3 8 , 7 4 7 (D
. C
. C i r. 1 9 9 5 ))
. De s p i t e t h i s fl ex i b i l i ty , "a p arty s ee k i n g a preliminary

injunction must demonstrate . . . a likelihood of succe ss on the merits." Muna f, 128 S. Ct . at 2219 (interna l quotation marks omitted). Furthe r, " [a] movant' s failure to show any irrepa rable harm is . . . g rounds for r efusingto issue a pre liminary injunction, even if the othe r-7-

three fac tors enter ing the calc ulus merit such relief ." Cha plaincy of F ull Gospel Churches, 454 F.3d at 297; see also Winter v. Natura l Res. Def. Council, Inc., 129 S. Ct. 365, 375 (2008) (a plaintiff must "de monstrate that irre para ble injury is likely in the absenc e of a

n injunction," and not a mere "possibility ")
. Many of L G' s claims arise unde r the Administrative Proce dure A ct (" APA") . Under the APA, a cour

t must "hold unlawful and se t aside ag ency action, finding s, and conc lusions" that are "arb it rary , cap ri cio us , an abu se o f di scr eti on , o r ot herw is e no t i n acco rdan ce wi th law ," 5 U.S.C. § 706(2)(A) , in excess of statutory authority , id. § 706(2)(C), or "w ithout observance of proce dures r equire d by

law," id. § 706(2)(D ). The sc ope of r eview, how ever , is narrow . See Motor Vehicle Mfrs. Ass' n of U.S., Inc. v. State F arm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983). The court is to presume that the ag ency ' s action is valid. See Citiz ens to Preser ve Ov e rt on Park , Inc . v . V olp e , 4 01 U. S. 4 02 , 4 15 (1 97 1) . A nd the " c ourt

is n ot t o s ub sti tut e its judgme nt for that of the ag ency ." State F arm, 463 U.S. at 43. None theless, the cour t must be satisfied that the a g ency

has " ' examine[ d] t he re levant data and ar ticulate[d] a satisfa ctory explanation for its action including a rational connec tion between the fac ts found and the c hoice
ma de .' " Al ph arm a , Inc . v . L e avitt, 4 60 F .3 d 1 , 6 (D .C. Cir . 2 00 6) (q uo tin gState F arm , 4 63 U. S. at 43). ARG UMENT I. Like liho od o f Suc c e ss A. L G' s APA Challeng es L G contends that DOE' s actions violate both the APA' s proce dural a nd substantive require ments. The Court takes e ach in turn.-8- 1
. APA Proce dural Chall enges L G ar g ues that, in the par ties' 2008 Ag ree ment, DOE a dopted the " definitive int e rp re tatio n" that th e HF R- 1 te st p e rm its re fr ig e ra tor s' fi ll t ub e and ic e e je c tio n h e a te rs to
rema in completely

power ed off

duringener g y

eff iciency testing. See Pl.'s Mem. at 25- 26. Once an ag ency has g iven a r egulation a def initive interpretation, " it can only chang e that interpr etation as it would formally

modify the re g ulation itself: through the proce ss of notice a nd comment rulemaking .” Para ly

zed Veter ans of Am. v. D.C. Ar ena L .P., 117 F.3d 579, 586 (D.C. Cir. 1997); see a lso Alaska Prof' l Hunters Ass' n, Inc. v. F ed. Aviation Admin., 177 F.3d 1030, 1034 (D .C. Cir . 1 99 9) . A c c or din g ly , L G r e a so ns , D OE ' s N ov e mbe r 1 0 le tte r r e qu ir ingL G t o te st a ll its refrig erators with the icemake r and its components powe red on but " disabled for purposes of making ice" constitutes a substantive cha ng e to DOE' s definitive interpre tation of the HRF- 1 testing c riteria that require s a full notice- and-c omment rulemaking . See Pl.'s Me m. at 25. For an in ter

pret ati on to be d efi ni ti ve, ho wev er, i t m us t b e "'ex pres s, di rect , an d u ni form. '" Me tw e st Inc . v . Se c ' y

of L a bo r, 56 0 F .3 d 5 06 , 5 10 (D .C. Cir . 2 00 9) (q uo tin g As s' n o f A m. R .Rs
. v. Dep' t of Tra

nsp., 198 F.3d 944, 949 (D .C. Cir. 1999)). The a g ency must have expressed the kind of " ' fair a

nd considere d judgme nt' that can be thought of as an a uthoritative depa

rtmental position" " upon which af fec ted par ties could rea sonably

rely ." Par aly

zed Veter ans, 117 F .3d at 587 (quoting Auer

v. Robbins, 519 U.S. 452, 462 (1997)). DOE did not adopt such a definitive int e rp re tatio n in

the pa rt ie s' 20 08 Ag re e me nt. The ba sis for L G' s argument that the 2008 Ag ree ment repr esents DOE ' s definitive interpre tation of the HRF- 1 test is the contrac t's pr ovision that refrig erators cover ed by the Ag ree ment would be tested-9-

using te sting proc edure s consistent with DOE' s interpre tation of the oper ating conditions specified in [the] HRF-1 [test] , which re quire that the ic e making sy stem of the re frig erator-fr eezer be disabled f

or purpose s of makingice but that all other sy stem components re main on during testing w ith the exception of the fill tube and ice ejec tion heater s, which may rema in off for

the purposes of

testing under this Ag ree ment subject to furthe r notice by DOE. 2008 Ag ree ment at ¶ 3. L G re ads this lang uag e such that the phrase "c onsistent with DOE' s interpre tation of the [HRF-1 test' s] operating conditions" include s within it s scope the f act that the f

ill tube and ice ejec tion heater s "ma

y rema in off for

the purposes of

testing." Pl.'s Reply

at 12-13. Thus, the argument g oes, throug h this Agr eeme nt DOE announc ed to the entire industry its definitive interpre tation that the HRF-1 te st permits fill tube and ice e jection heaters to re main power ed off duringtesting. The Court conc ludes that the better rea ding of

this provision of the Ag ree ment, howeve r, is that L G' s ref

rig erators are g ener ally

subject to the HRF- 1 testing pr ocedur es, which, "c onsistent with DOE' s interpre tation," " require that the ice ma king sy stem of the re frig eratorfre ezer be disabled for

purposes of making ic e but that all other sy stem components re main on d uri n g t es t i n g. " U n d er

th e A gre em en t , th en , L G i s af fo rd edan "ex ce p t i o n " t o DO E 's interpre tation of the HRF- 1 test, where by L G may keep the fill tube and ice ejec tion heater s off for pur poses of testing"unde r this Ag ree ment." The Court' s rea ding of

the contra ct is supported by the Ag ree ment' s lang uag e, which pe rm its the fi ll t

ub e and ic e e je c tio n h e a te rs to " re ma in o ff fo r p ur po se s o f t e sti ngun de r t

his Ag re e me nt. " Wer e L G' s inte rp re tatio n o f t he c on tr a c t c or

re c t, t he wo rd s " un de r t

his Agre e me nt" would be wholly

superf luous: "consistent with DOE' s interpre tation of the oper ating conditions,"-10-

L G could alwa

y s keep the fill tube and ice ejec tion heater s off, whe ther or not testingproce dures
wer e g overne d by

the 2008 Ag ree ment. Indeed, L G all but conce ded as muc h during oral argument. See Tr. 26- 27. Thus, the only way to give this phrase mea

ning is to re ad the Ag ree ment as g rantingL G a dispensation to keep its fill tube and ice e jection heaters off

during testing, de spite DOE' s contrar y interpre tation of the HRF- 1 test. See Restateme nt (Second) of Contracts § 203(a ) (1981) (" [A] n interpre tation which g ives a re asonable , lawful, a nd eff ective meaningto all the terms is pref err ed to an inter

pretation which leave s a par t unrea sonable, unlawful, or of

no eff ect." ). Fur ther, the A g ree ment states that the two hea ters " may rema in off for

the purposes of t es t i n g un d er

th i s Agr ee m en ts u

b j ec tt o fu rt h er

n o t i ce b y DO E
. " I f t h e C o urt we re t o ac ce p tL G's
rea ding of

the contra ct, it would mean that DOE adopted a definitive interpr etation of the H RF-1 te st - - whic h w ou ld, by

de fi nit ion , b e bin din g on a ll i nd us tr y -- but th e n r e se rv e d th e ri g ht t o wi thd ra w that in te rp re tatio n at w ill fr om L G a nd on ly L G. Suc h a

re a din g wo uld

imp lic itl y

ho ld that DOE attempted to contrac t around the A PA, and the Court dec lines to do so. L G r es p o n d s th atth e w o rd"n o t i ce " r ef er s t o a f u l l n o t i ce -a n d -c o m m en tru l em ak i n g, imply ing that DOE did intend the Ag ree ment to constitute the sort of def initive interpretation that may only be re vised throug h compliance with the APA' s proce dural re quirements. Pl.'s Me m. at 28-29. B ut there is nothing in the Ag ree ment' s lang uag e or struc ture to sug g est this is t he ca se, and the a bsence of any

expli cit ref

ere nce to f

ormal rulemaking in the te x t in fact sug g ests the op po sit e . F ur

the r c utt inga g a ins t L G' s a rgume nt, the c on tr a c t pr ov ide s th a t " [n]ot ic e s a nd a ll oth e r c or re sp on de nc e re late d to the ob lig a tio ns lis te d in thi s A g re e me nt s ha ll b e de liv e re d" to repr esentatives of ea ch par ty . 2008 Ag ree ment at ¶ 17(h) . The languag e in par ag raph thre e ofWithits re ply br ie f, L G h a s o ff

e re d a n a dd iti on a l de c laratio n a lon g wi th s e ve ra l e xhibi ts 5 that purportedly

establish that L G intended a nd understood that the testingproce dures in the Ag ree ment wer e to re main in effe ct until DOE g ave notice throug h a for mal rulemaking . See Pl.'s Reply , Dec l. of J ohn Taylor (" Taylor Dec l.") & A ttached E x hibits. The Court need not addre ss this ex trinsic evidenc e, howe ver, be cause the meaningof the ter m "notice " is c lear . See Br ubaker v. Metro. L ife Ins. Co., 482 F.3d 586, 590 (D.C. Cir. 2007) (" Where the te rms of a contra ct ar e cle ar, that is the end of the matter ; we nee d not look to ex trinsic evidenc e . . . ." ); Consolidated Gas Tra

nsmissi on Corp. v. FERC, 771 F.2d 1536, 1544 ( D.C. Cir. 1985) (" I f a contra ct is not ambiguous, e x trinsic evidenc e ca nnot be used a s an aid to interpr etation." ). -11- the Ag re e me nt i s th e c on tr a c t' s o nly me nti on of " no tic e ." Con str

uin g the re fe re nc e to " no tic e " in para g raph 3 a s requiringa full notice- and-c omment rulemaking , then, would re nder pa ragraph 17(h) a ll but meaningle ss. See Restatement ( Second) of Contracts § 203(a ). 5 In another

eff ort to sustain its readingof the 2008 Agree ment, L G contends that DOE could not have grante d it a specia l "e x ception" to the testing c riteria be cause such wa ivers may only be g rante d in response to a petition, and afte r the opportunity for public notice and comment. See Pl.' s Mem. at 27 n.8 (c iting 10 C.F.R. § 430.27). B ut this i s not so. The regulation L G points to concer ns petitions to waive testing r equire ments when a n appliance "c ontains one or more desig n char acte ristics which . . . pre vent testing of the ba sic model
a c c or din g to t

he pr e sc ri be d te st p ro c e dure s, " or wh e re the te st w ou ld " pr ov ide mate ri a lly inacc urate compar ative data ." 10 C.F .R. § 430.27(a)( 1). Ne ither is the ca se her e. L G also points to a DOE pre ss relea se issued conte mporane ously with the 2008 Agr ee m en tth atp urp o rt ed l y s u p p o rt s i t s ar gu m en tth at th e A gre em en tco n s t i tu t es DO E 's de fi nit ive int e rp re tatio n o f t he HRF -1 te st. L G r e fe rs to t he fo llo wi nglangua g e : " To e ff e c tiv e ly
measure the saving s associate d with the Energy Star p ro gra m , al l p artn er s mu s tre p o rt en er gy consumption data base d on the same standa rdized test proce dures. Toda y ' s ag ree ment ensure sL G has off ere d sever al other e x hibits t o support its belief that the 2008 Ag ree ment 6 repr esente d DOE' s definitive interpre tation of the HRF- 1 test. These e x hibits are irre levant to the Court's a naly sis, however , as they

repr esent the opinions of non-U .S. gove rnmental e ntities, or car ry the express disclaimer that they do not nece ssarily

ref lect the view s of the United States Go ve rnme nt. Se e , e .g ., Pl. ' s Me m., Exhi bit 10 (L e tte r f

ro m E le c tr olux); Pl .' s Re ply , Su pp . D e c l. of Ti mot hy Mc Gr a dy

(" Mc Gr a dy

Sup p. De c l." ), Exhi bit s 2 (1 99 6 Re po rt on En e rgy Us e in Refrig erators), 15 (Cana da' s Energy Effic iency

Reg ulations). -12- that L G' s future me asure ments of ene rg y usag e for ref rig erators and fr eezer s will help assure
c on sume rs have a c c ur a te inf or matio n. " Pl. ' s Me m., Exhi bit 12 (D OE Pr e ss R e le a se ), 2. Th is statement is of little value. I t observes that effe ctive mea surements of e nergy saving s require
c on sis te nt t e st p ro c e dure s, but it do e s n ot d e c lare that L G' s te st p ro c e dure s a re no w, purs ua

nt t o the Ag ree ment, consistent with the rest of industry ' s. I ndeed, the press re lease offe rs only that the Ag ree ment will "help a ssure [that] consumers ha ve ac curate information," not that they will have "c onsistent" information. 6 The Court conc ludes that the 2008 Ag ree ment, fairly rea d, ref lects the fa ct that DOE w as
mere ly g rantingL G an e x ception to its interpretation of the HRF- 1 test for c erta in refr ige rators. At the least, howe ver, the fore g oing disc ussion revea ls that the 2008 Ag ree ment is ambiguous a s to whether

DOE' s position was that the HRF-1 te st require s the fill tube and ice ejec tion heater s to remain off

, or whe ther DO E was g rantingL G an e x ception to its interpretation of the testing proce dures. This ambiguity , by itself, establishes that the 2008 Agree ment does not repr esent DOE' s definitive interpre tation of the HRF- 1 test. See Metwe st, 560 F.3d at 510 (a definitive interpre tation must be "' express, direct, a nd uniform' " ( quoting Ass' n of Am. R.Rs., 198 F.3d at 949)). L G a l s o i mp l i es th ati n d u s try gu i d an ce DO E i s s u edi nJ an u ary 2 0 0 9 re p re s en t s DO E 's definitive interpr etation of the r egulation. This guidanc e cla rifies " that ener g y

consuming-13-

components that intera ct with the ice making sy stem but are not involved in the pr oduction, h ar v e s t i n g , o r

s t o r a g e o f

i c e . . . ar e n o tc o n s i d e r e d p arto f th e a u t o m a t i c i c e m ak e r . A c c o r d i n g l y, the ene rg y

consumed by

these c omponents is included in calculating a product' s repor

ted total
ener g y usag e." Pl.'s Mem., Exhibi t 13 (J anuar y 2009 Guidance ). L G is corr ect that this g uidance offe rs some support for its posit ion that DOE interpr eted the HRF- 1 test to permit fill tube and ice e jection heaters to re main off dur ing te sting. The g uidance states that ene rg y consumed by

components that ar e not involved in the produc tion, harve sting, or stora g e of ic e is included in total ene rg y usag e. The implication, then, is that the
ener g y used by components that ar e " involved in the production, har vesting , or storag e of ic e" -- and DOE has not disputed that the fill tube and ice ejec tion heater s are so involved -- is excluded from total ene rg y

usag e. None theless, the Court ca nnot conclude that, entirely by neg ative implication, DOE was in its J anuar y 2009 Guidance expressing the sort of " ' fair a nd considere d jud g me nt' that c an b e tho ug ht o f a s an a uth or itativ e de pa

rtme nta l po sit ion ." Pa

ra ly zed Ve te ra ns , 117 F.3d at 587 (quoting Auer, 519 U .S. at 462); see a lso Metwest, 560 F.3d at 510 (a de finitive interpre tation must be "' express, direct, a nd uniform' " ( quoting Ass' n of Am. R.Rs., 198 F.3d at 949); id. (if a ne w guidance document " ' can r easona bly be interpr eted' as consistent with prior do c ume nts , it

do e s n ot s ig nif

ic antl y re vis e a pr e vio us a

uth or itativ e int e rp re tatio n" (q uo tin g Ai r Transp. A ss'n of

Am. v. Fe d. Aviation Admin., 291 F.3d 49, 57-58 ( D.C. Cir. 2002))). In sum, prior to its November 10, 2009, letter , DOE ha d never issued a def

initive interpre tation to indust ry

that the HRF- 1 test permits ref rig erators' fill tube and ice ejec tion heate rs to rema in powere d off dur ing e nergy eff iciency testing. I f any

thing, the 2008 A g ree ment
su g g e sts that D OE he ld t

he op po sit e vie w. Ac c or din g ly , D OE wa s n ot r e qu ir e d to e ng a g e inL G' s argument that DOE fa iled to comply with EPCA's proc edura l require ments befor e 7 chang ing the Energy

Star testing c riteria, se e Pl.'s Me m. at 21-25, fa ils for similar rea sons. B e c a us e DO E' s a c tio ns did

no t r e vis e any

En e rgy Sta r s pe c if ic a tio n o r c ri te ri on , b ut m e re ly ex p re s s edan i n t er

p re t at i o no f e x i s t i n g re gu l at i o n s , th e a gen cy d i d n o tn ee d t o ad h er e t o E P C A's notice, comment, a

nd lead time re quirements. See 42 U .S.C. § 6294a. These mode l series a

re: L FX25950, L FX25960, L FX25971, L FX23961, L FX21960ST, 8 L FX21971ST, L FX21980ST, L FX25980ST, L MX21981ST, and L MX25981ST. See 2008 Ag ree ment, at ¶ 1. -14- notice and c omment rulemakingunder the APA befor e see king to e nforc e its November 10 letter,
and the Court c on c lud e s th a t L G h a s li ttl e lik e lih oo d o f s uc c e ss o n th e me ri ts o f t his APA
c ha lle ng e to D OE ' s a c tio ns . 7 At the motions hearing , L G ar g ued that eve n assuming D OE had not a dopted a de finitive int e rp re tatio n o f t

he HRF -1 te st that w ou ld b ind a ll o f i nd us tr y , th e a g e nc y

sti ll c ou ld n ot a

pp ly its "new " te sting c riteria to the a pproxi mately

40,000 L G re frig erators that are at issue her e. See Tr. at 30- 31. Acc ordingto L G, these r efr ige rators w ere produce d befor e DOE ' s J anuar y 20, 20 10 , d e a dli ne purs ua

nt t o th e te sti ngc ri te ri a

se t f or th i n th e pa

rt ie s' 20 08 Agre e me nt ( and in relianc e on that Ag ree ment). Applying ne w testing criter ia to these units, L G insists, would be
an im pe rm iss ibl e re tr oa c tiv e a g e nc y a c tio n. B e fo re re a c hin g the me ri ts o f L G' s a rgume nt, howeve r, the Court must first determine whether the L G re frig erator models at issue her e we re wi thi n, and

he nc e pr od

uc e d und e r, the te rm s o f t he 20 08 Agre e me nt. In the introduction to the 2008 Ag ree ment, the par ties purported to re solve all disputes relating to " the L G re frig erator-fr eezer s equipped with F renc h Doors and thr oug h-the-door ice service set forth be low (her eaf ter re fer red to a s ' the Aff

ecte d Models' )." 2008 Ag ree ment at 1. Th e Agre e me nt l a te r i de nti fi e s th e se " Af fe c te d M od e ls" a s r e fr ig e ra tor s f a lli ngwi thi n c e rt a in
m o d e l nu mb e r

s e r i e s , a s w e l l a s " an y

an d a l l s i m i l ar

o r d e r i v a t i v e m o d e l s m a d e f o r an y LG 8The model ser ies named in the le tter ar e: L FX28977, L FX25975, L FX21975, 9 L MX25985, 7973 (Sear s), 7975 (Sea rs), a nd 7978 (Sear s). I d. L G a l s o p o i n t s t o ane m a i l w r i t t e nb y R i c h ar d W i n g a t e , L G ' s g e n e r a l c o un s e l , tw o d ays 10 (continued...) -15- Ori ginal Equi pm entMan ufac tu rer cu st om ers who se p roduct s ar e so ldinth e Un it ed S tat es. " 2008 Ag ree ment, at ¶ 1. DO E s tate d at or a l argume nt t hat th e mod e l se ri e s e xplic itl y lis te d in the 20 08 Agre e me nt

" we re a ll d isc on tin

ue d" or are " no t th e on e s th a t are a t is su e in t his c a se ." Tr . at 52 . T his repr esentation comports with a Dec ember 18, 2009, letter fr om DOE to L G which lists the ref rig erator models for whic h DOE ha s now, over a y ear later, te rminated the Ene rg y Star ag ree ment. See De fs.' Opp' n, Ex hibit 4 (Dece mber 18, 2009 letter), 1-2. None of the model series ide ntified in the Dec ember 18, 2009, letter matc h those listed in the 2008 Ag ree ment. I d. 9 L G has not disputed the g overnme nt's r epre sentation that none of the models listed in the 2008 Ag ree ment are at issue in the pre sent dispute. Instead, L G ar g ues that the a ffe cted ref rig erators are "similar or

derivative models within the[ ] product lines" listed in the Ag ree ment. Tr. 71. That may

be so. B ut, by

its terms, the 2008 Ag ree ment applies only to "similar or derivative models" when they are "ma de for

any L G Orig inal Equipment Manufa cture r customer s whose produc ts are sold in the United States." 2008 Ag ree ment, at ¶ 1. DO E stated at the hear ing that these " are Kenmore brand mode ls." Tr . 51; see Tr . 83 (" That re fer s to Kenmore brand r efr ige rator- fre ezers that L G manufa cture s to carr y the Kenmor e bra

nd.") ; see a lso DOE Press Release , at 1 (" The followingmodels are aff ecte d by today ' s ag ree ment: [ the model serie s listed in footnote 8, supra,] as well as c ompara ble Kenmor e-br and ' TRI O' models desig ned and manufa cture d by

L G." ). L G did not disag ree . 10(...continued) 10 be fo re the 20 08 Ag re e me nt w a s si g ne d. Tr . at 73 (c iti ngPl. ' s Re ply , T aylor De c l., Exhi bit

4 (N ov e mbe r 1 2, 20 08 Em a il) . In it , M r. Wing a te re lay s h is und e rs tand ingof the Agre e me nt, writing "[i]t [i s] further ag ree d that until DOE issues further g uidance and that guidance become s eff ective, f uture produc tion of ' Affe cted Mode ls' c an be done on the basis of these heate rs being off." Wingate E mail, at 1. L G misses the point: the refr ige rators at issue here are not "Af fec ted Models," a s defined in the A g ree ment. -16- Be cause the par

ties' 2008 Ag ree ment, by

its plain terms, does not ext end to the
re fr ig e rator s at is su e in t

his dis pute , D OE did

no t r e tr oa c tiv e ly

a pp ly its " ne w" te sti ngc ri te ri a

to ref rig erators that wer e cove red by the Ag ree ment. There fore , the Court conclude s that L G has no lik e lih oo d o f s uc c e ss o n th e me ri ts o f i ts r e tr oa c tiv ity argume nt. 2
. APA Substantive Challenges Ina d d i t i o nt o i t s a l l e g a t i o n s th a tD O E v i o l a t e d th e A P A ' s p r o c e d

ur a l r e qu i r e m e n t s , LG also contends that DO E' s actions ar e ar bitrary and ca pricious in sever al way s. L G first ar g ues that DOE " has not cited a ny leg itimate gr ound for r evokingthe Ag ree ment." Pl.' s Mem. at 28-29. B ut in its November 10, 2009 letter, DO E told L G that it was revokingthe Ag ree ment' s testing e x ception bec ause the ag ency felt it "ha s g iven L G an unintended adva

ntag e in the mar

ketplace and [has] resulted in significa nt underre porting of the
e n e r g y c o n s u mp t i o no f

LG m o d e l s t o b o thD O E an d c o n s u m e r s . " N o v e mb e r

1 0 Le t t e r , a t2
. LG
may dis a g re e wi th t

he data or re a so nin g un de rl yingthi s e xplanatio n - - i nd e e d, L G r a ise s a separ ate APA c halleng e to the testingdata - - but DOE' s stated justifications for re voking the Ag re e me nt' s te sti nge xce pti on are no t th e mse lve s a

rb itr ary and c a pr ic iou s. L G also insists that DOE is subjecting it to inconsistent testing standa rds. On De cembe r 18, 2009 -- a fter L G filed its motion for a pre liminary injunction -- DOE issued a dditional g u i d an c e t o i n d

u s tr y a b o u ti t s e n e r g y e f

f i c i e n c y t e s t i n g p r o c e d

ur e s . S e e D e p art m e n to f

E n e r g y,-17-

Ad d i t i o n al Gu i d an ce R ega rd i n g Ap p l i ca t i o no f C urr en tP ro ce d ure s fo r T es t i n g E n er gy Consumpti on of Refr ige rator- Fr eezer s with Automatic I ce Ma kers ( Dec . 18, 2009) (" Dec ember Gu ida nc e " ), ava ila

ble at http: //www 1. e e re .e ne rgy .g ov/bu ild ing s/a pp lia nc e _s tand ard s/r e sid e nti a l/ pd fs /r f_ te st_ pr oc e dure _a dd l_guid anc e .p df . L G c on te nd s th a t th is " De c e mbe r Guid anc e is
mark e dly dif fe re nt t ha n th e te sti ngc ri te ri a

that D OE or de re d L G t o a pp ly jus t w e e ks e arl ie r i n it s November

Orde r." Pl.'s Reply

at 10-11. SubjectingL G to two inconsistent standards mer e
we e ks a pa rt , L G i mpl ie s, is a

rb itr ary and c a pr ic iou s. The Court see s nothing mate rially inconsistent betwee n DOE' s November 10, 2009, le tte r, and the a g e nc y ' s su

bs e qu e nt D e c e mbe r Guid anc e . In N ov e mbe r, DO E wro te to L G that, duringtesting, " the ice ma king sy stem of the re frig erator-fr eezer [m ust] be disabled f

or purpose s of makingice but . . . all other sy stem components [must ] remain on duringtesting inc luding the fi ll t ub e and ic e e je c tio n h e a te rs ." No ve mbe r 1 0 L e tte r, a t 2 ( e mph a sis re mov e d) . In it s Dec ember

Guidance , DOE stated that, during testing, ice make rs and a ll ice makingcomponents -- including the fill tube heate r and ic e ejec tion heater

-- must be on a

nd functioning as they

would be whe n the icemaker is not actively

making ice. The ice make r and a ll ice makingcomponents -- including the fill tube heate r and ic e eje ction heate r -- may be re ndere d ' inoperative' by

preve nting the ma chine f rom making ice dur ing the test, such as by cre ating a condition in which the mac hine senses a full bin of ice. Dec ember

Guidance , at 3. Th e se tw o s tate me nts a

pp e ar c on sis te nt i n a ll m a te ri a l r e sp e c ts. To be sure , th e ir lang uag e diffe rs sig nificantly . But the Court c annot asc erta in any distinction between a

n icemake r that is "disa

bled for pur

poses of makingice" but with its components turned on (includingthe heaters at issue) , and an ic emake r and its components (inc luding the he ater s) that-18-

are turn ed "on andfun cti on in g as t hey wou ldbe w hen th e ic ema ker i s n otact iv ely mak in g ice. " Ind e e d, wh e n th e Court

a sk e d L G at or a l argume nt h owthe sta nd ard s d if

fe re d, L G f

a ile d to identify specific inconsistencies be tween the two. See Tr. 43- 44. Instead, L G offe red that "the November

order was not as spe cific a s the Dec ember g uidance ." T r. 44. This may be true . But the Court nonetheless se es nothing arbitra ry and ca pricious in DOE' s wholly consistent instructions to L G about its interpre tation of the HRF- 1 test. Finally , L G contends that DOE' s actions ar e ar bitrary and ca pricious bec ause the testing data the a g ency

relied upon in its November 10 letter wa s flawe d. Pl.'s Mem. at 29- 32. In that le tte r, DO E wro te that " [w]he n te ste d a c c or din g to t he e xistin g DO E t e st p ro c e dure . . . [c e rt a in L G r e fr ig e rator

mod e ls] w ou ld n e ith e r q ua lif y fo r E ne rgy

Sta r, no r c omp ly

wi th t he a pp lic a ble
ener g y eff iciency standards." November

10 L etter, at 1-2. DOE a ppare ntly based this conc lusion
on tes ti ng dat a ob tai nedfro m t wo i nd epen den t l abo rat ori es, CS A I nt erna ti on al a ndBR L aboratories. See Mc Cabe De cl. at ¶¶ 40-41. L G ar g ues that these la

boratorie s' testing data " is fundamentally flawe d" be cause the l ab o ra t o ri es t es t edL G's re fr i ger at o rs i na m an n er i n co n s i s t en twi thDO E 's t es t i n g cr i t er i a. P l
. 's Re ply a t 15 . F or

e xamp le , L G c on te nd s th a t B R L a bo ra tor ie s c on du c te d s ome of its te sts wi th th e r e f r i g e r a t o r s ' i c e m ak e r s p o w e r e d o nan d a c tu a l l y p r o d u c i n g i c e . S e e P l
. ' s M e m . a t3 1
. LG has off ere d two decla

rations by Timothy McGra dy , an Environmenta l Manag er at L G, to support its posit ion. See g ener ally McGra dy

Dec l. at ¶¶ 22- 25; McGra dy Supp. Decl. at ¶

¶ 17-20, 29, 32. DOE, re lying on its own de clar ations submitt ed by Michae l McCabe, a

senior ag ency

eng ineer , disag ree s with Mr. McGra dy ' s char acte rization of the testing r esults, and spec ifically denies that the laboratories' tests were conducte d in a manner inconsistent with DOE' s testing c riteria. See-19-

general ly McC abe D ecl . at¶¶ 4 2-4 3; S up p. Decl . o f Mi chael McC abe ( "McC abe S up p. Decl .") ¶¶ 30- 32. The Court has r eviewe d the experts' decla rations, as we ll as the laboratories' repor ts to the extent they

have be en provide d. See Pl.'s Me m., Ex hibit 15 (BR L aboratories Test Results). At this stage , howeve r, L G has not shown a likelihood of suc cess on its cha lleng e. Mr. Mc Gra dy
and Mr . M c Ca

be of fe r c omp le te ly

dif fe ri ngop ini on s a s to wh e the r t he tw o la bo rator ie s p ro pe rl y fo l l o we d DO E 's t es t i n g cr i t er i a, an d th e C o urt h as b ee ngi v en n o re as o nt o ac ce p tL G's ex p er t 's opinion over DOE' s. The Court has no de clar ations from individuals who actua lly conducte d the testing at issue. Nor has the Court ha d the bene fit of live testimony , or indepe ndent testing p er fo rm edb y

a d i s i n t er es t edth i rdp arty , t o re s o l v e t h i s h i gh l y t ec h n i ca l i s s u e. In d ee d , al th o u gh appar ently

throug h no fault of L G' s, the Court still has not bee n provided with the two laboratories' complete testingresults. Moreove r, whe n, as her e, an a g ency "is e valuating scientific data within its t echnic al expertise," the Court must give the ag ency "a n extreme deg ree of def ere nce." Am. Fa

rm Bur eau F ed' n v. EPA, 559 F.3d 512, 519 (D .C. Cir. 2009) (internal quotation marks omitted); see a lso Am. Radio Relay L eag ue, Inc. v. F CC, 524 F.3d 227, 233 (D.C. Cir. 2008) (" Where a ' highly technica l question' is involved, ' courts nec essar ily must show considera ble def ere nce to a

n ag ency ' s expertise.' " ( quoting MCI Cellular Tel. Co. v. FCC, 738 F.2d 1322, 1333 ( D.C. Cir. 1984))). Give n this defer ence , and espe cially at this init ial stag e, the n, L G h a s n ot m e t it s b ur de n to sh owa lik e lih oo d o f s uc c e ss o n th e me ri ts o f i ts c ha lle ng e to the testing data unde rlying D OE' s November 10, 2008 letter. B. L G' s Due Proce ss Challeng es L G contends that DOE' s insist ence that it remove the Ene rg y Star label fr om-20-

approximately

40,000 ref

rig erators that have a lrea dy been ma nufac tured a

nd tested violates the Constit ution by

deprivingL G of c onstitut ionally protec ted prope rty

and liberty

interests without due proc ess of law
.

1
. Du e Pr oc ess Pro

pe rty In te re st To deter mine whether

DOE' s actions violate L G' s due proc ess prope rty rig hts, the Court must first ex amine whe ther L G is threate ned with the depr ivation of a c onstitut ionally protec ted proper ty interest. Am. Mfr s. Mut. I ns. Co. v. Sul livan, 526 U.S. 40, 59 (1999). " Only afte r fi n d i n g th e d ep ri v at i o n

o f ap ro t ec t edi n t er es t " m ay th e C o urt an al y

z e w h et h er

th e go v ern m en t 's proce dures " comport with due proc ess." I d. Her e, L G contends that "the pr imary interest at issue" is " L G' s protecte d interest ag ainst summary and re troac tive action to demand r emoval of the Ener g y

Star desig nation from produc ts in commerce ." Pl.' s Reply , at 17 n.15. In other words, L G claims a pr otected pr operty interest in havingthe 40,000 or so re frig erators at issue here continue to bea

r the Ene rg y

Star label. The due proce ss clause pr otects " the sec urity of intere sts that a person ha s alrea dy
a c qu ir e d in

sp e c if ic be ne fi ts. " B d. of

Re g e nts v. Roth, 40 8 U .S. 56 4, 57 6 ( 19 72 ). Th e se constitutionally

protec ted prope rty

interests " are not cre ated by the Constitut ion. Rather, they are
cre ated a nd their dimensions are define d by exis ting r

ules or under standing s that stem from an independe nt source suc h as state law -- r ules or under standing s that secur e ce rtain bene fits and that support claims of entitlement to those bene fits." I d. at 577. For example, in Rot h, the scope of Roth's " ' proper

ty ' interest in employ

ment at Wisconsin S tate Univer sity -Oshkosh wa s cre ated and def ined by the terms of his appointment." I d. at 578. In this case, L G' s asserte d proper ty interest ar ises throug h a contr act. Althoug h the-21-

Energy Star prog ram is cr eate d, and its ener g y eff iciency standards pr escr ibed, by

law, compa

nies may only participate in the prog ram a fter sig ning individual licensingag ree ments. L G enter ed into such a licensingag ree ment with DOE in 2001. See De fs.' Opp’n, Z oi Decl., Exhibit A (2001 L G-DO E Ener g y

Star L icensingAg ree ment). Thus, L G' s participation in the Ene rg y Star prog ram, a

nd any rig hts it has for its qualifying pr oducts to bear the Ener g y

Star label, a

re derive d throug h its li censingag ree ment with DOE. T h e C o urt , h o we v er , n ee d n o td ec i d e w h et h er

L G's as s ert edri gh tt o m ai n t ai nth e E n er gy Star labels on the r efr ige rators at issue give s rise to a c onstitut ionally protec ted prope rty

interest. Compare L

ujan v. G & G Fir e Sprinklers, 532 U.S. 189, 196 (2001) (" [W ]e assume for pur poses of dec ision here that G& G has a proper ty interest in its claim for pa y ment [pursuant to the contra ct] . . . ."), with Ta ake v. County of Monroe , 530 F.3d 538, 541 ( 7th Cir. 2008) (" ' [I ]t has long be en settled that a

mere brea ch of c ontrac t by the g overnme nt does not g ive rise to a constitutional claim.'" (quoting Sudeikis v. Chi cag o Transit Auth., 774 F .2d 766, 770 (7th Cir. 19 85 )) . F or

e ve n if the Court a ssume s th a t th e pa

rt ie s' 20 01 lic e ns inga g re e me nt c re a te s a
c on sti tut ion a l pr op e rt

y int e re st i n ma int a ini ngthe En e rgy Sta r l a be ls o n e xistin g pr od

uc ts, L G i s
no t e nti tle d to any

pr oc e ss a g a ins t D OE be y on d a po st- de pr ivatio n la

ws uit . " [A] c la im that a g overnme nt ag ency

has violated a

party ' s rig ht to due proce ss by ref using pe rfor

mance under a contra ct," as her e, " is substantively indisti ng uishable fr om a bre ach of contra ct claim." Suburban Mortg . Assocs. v. De p' t of Housing and Ur ban De velop., 480 F.3d 1116, 1127- 28 (F ed. Cir. 2007). B ut due proc ess prope rty interests that der ive from c ontrac t "c an be f ully protec ted by

an ordinary brea ch-of

-contra ct suit." L

ujan, 532 U.S. at 196. Thus, " [t ]he process to which pla intiff is du e" und er t hes e ci rcum st ances "is a po st -dep ri vat io n s ui t f or b reach of t he co nt ract ."-22-

Suburban Mortg . Assocs., 480 F .3d at 1128.

2
. Du e Pr oc ess L ibe rty In te re st L G also cla ims that it has a " ' liberty interest in avoidingthe damag e to its reputation and business cause d by

a stig matizi ng suspension' " f rom the Ener g y

Star prog ram. Pl.' s Reply at 17 (quoting Reeve Aleutian Airw ay s, I nc. v. United States, 982 F .2d 594, 598 (D.C. Cir. 1993)). Ind e e d, " g ov e rnme nt s tig matizatio n th a t br oa dly pr e c lud e s in div idu a ls o r c or po ra tio ns fr om a chosen tra de or business de prives them of liber ty in violation of the Due Proce ss Clause." T rifax Corp. v. Dist. of Columbi a, 314 F .3d 641, 644 (D.C. Cir. 2003). The na rrow a nd conditional remova l from a voluntar y g overnme nt prog ram see n here , howeve r, bea

rs no re semblance to a broa d prec lusion from a chose n trade or business. L G has not been pe rmane ntly

barr ed fr om the Energy

Star prog ram. Nor

is L G pre vented f

rom using the En e rgy Star l a be l on wh a te ve r q

ua lif yinga pp lia nc e s it se lls . Ind e e d, so fa

r a s th e Court

c an te ll, L G will be able to use the Ener g y Star label on ne w Fr ench D oor re frig erator models that it plans to sell beg inning January

20, 2010 -- mer e day s from now. See Pl.'s Reply at 2. And L G may still marke t and sell exist ing r efr ige rators that do not bear the Energy Star label. B eingrequire d to remove Ene rg y

Star labels fr om cer

tain ref rig erators will in no way

broadly prec lude L G from its chosen trade or business so as to implicate a due proce ss liberty interest. Ac cording ly , L G has
no t de mon str a te d a

lik e lih oo d o f s uc c e ss o n it s d ue pr oc e ss c la ims
. * * * * * In sum, L G has not shown a likelihood of suc cess on the me rits of any of its APA, EPCA, or due pr ocess c laims. Hence , L G has fa iled to establish this prong of the pre liminary

injunction
ana ly sis
.In fac t, L G' s failure to show a likelihood of succ ess may itself be dispositive. See 11 Munaf, 128 S. Ct. at 2219 (" [A] party seekinga pre liminary

injunction must demonstrate, a mong other thing s, a likelihood of succ ess on the mer its." (e mphasis added; interna l quotation marks omitted)); see a lso Davis v. Pension Bene fit Guar. Corp., 571 F .3d 1288, 1296 (D.C. Cir. 2009) (Kavanaugh, J , concur

ring ) (" [U] nder [Munaf], a movant ca nnot obtain a pre liminary injunction without showing both a likelihood of suc cess a nd a likelihood of irre para ble har m, among other things." ). -23- II. Irre parable Harm In li g ht o f L G' s f

a ilure to d e mon str a te a

lik e lih oo d o f s uc c e ss o n th e me ri ts o f i ts c la ims , to obtain a pre liminary

injunction L G must provide an ove rwhe lming showingthat it will s uffe r irrepa rable harm a

bsent immediate cour

t intervention. "T o demonstrate ir repa rable injury , a 11 plaintiff must show that it will suffe r har m that is 'more than simply irretr ievable; it must also be serious in terms of its eff

ect on the pla intiff.' " H i-Tec h Pharmac al Co. v. Food a nd DrugAdmin., 587 F. Supp. 2d 1, 11 (D.D .C. 2008) (quoting Gulf Oil Corp. v. Dept. of E nergy , 514 F. Supp. 10 19 , 1 02 6 (D .D. C. 19 81 )). "[ T] he al legedin ju ry mu st be cer tai n, great, actual , an d i mm in ent ." I d. (citingWis c. Ga s Co. v. FERC, 758 F.2d 669, 674 (D.C. Cir. 1985) ( per c uriam)) . L G has not made this showing he re. L G f i rs tco n t en d s th ati twi l l s u ff er i rr ep ar ab l e h armb ec au s e f o rc i n g i tt o re m o v e E n er gy Star labels fr om thousands of ref rig erators will cause - - L G fe ars - - def inite and substantial harm to i ts r e putatio n. Pl. ' s Me m. a t 37 -3 8; s e e Ar

mou r & Co. v. F re e man, 30 4 F .2 d 4 04 , 4 06 (D .C. Cir. 1962) (" damag e" to a business' s "g ood name" may constitute irrepa

rable injury); 11A Wright & Miller, F eder al Prac tice and Proc edure § 2948.1 (2d ed. 1995) (" Injury to reputation or g oodwill is not easily

measura ble in monetary

terms, and so ofte n is viewed a s irrepa rable .")
. Th e En e rgy

Star l a be l is un do ub te dly

of g re a t im po rt anc e to c on sume rs and re mov ingthe la

be ls, L G asser ts, will damag e its standing in the ma rketplac e.In it s o pe nin g br ie f, L G m a int a ine d th a t it s r e putatio n w ithre ta ile rs wo uld be a lso 12 harme d absent a

n injunction. See Pl.'s Mem. at 38. The se fe ars, howe ver, w ere larg ely based on the pre mise that DOE wa s "e ffe ctively banningL G' s ' Fr ench D oor' models entirely from the marke t for seve ral months." I d. These c oncer ns have be en re solved g iven that L G is alrea dy producingnew models of E nergy Star-compliant F renc h Door re frig erators for shipment and sa le.

-24- T h e C o urt fi n d s , h o we v er , th atan y re p u t at i o n al h armL G w i l l s u ff er b y re m o v i n g E n er gy Star labels fr om a limited number of units in one line of its ref rig erators will be relatively trivial. L G has re prese nted to the Court that it is already manufa cturingFr ench D oor re frig erators that comply with DOE' s testing c riteria. See Tr. at 3- 5. Thus, by J anuar y 20, 2010 -- the date by wh ic h L G m

us t r e mov e the En e rgy

Star l a be ls f ro m e xistin g F re nc h D oo r r e fr ig e rator s - - L G w ill be in a position to sell new Fr ench D oor re frig erators that do bear the Ener g y

Star label. There fore , reta ilers will, without si g nificant interr uption, continue to sell L G Fr ench D oor ref rig erators that bear

the Ener g y

Star label, e nsuring that most consumers will have no idea that L G w a s f or c e d to re mov e En e rgy

Star l a be ls f ro m so me of

its e xistin g re fr ig e rator s. Moreove r, 12 any reputational harm L G will suffer will be espec ially

minor in light of L G' s worldwide
re putatio n. B e sid e s r e fr ig e rator s, L G m anu fa c tur e s a wi de va ri e ty of c on sume r a

pp lia nc e s, amongthem cell phones, te levisions, washers a nd dry ers, ove ns, and air c onditioners. See g e n e r a l l y h t t

p : //w w w . l g e . c o m . D O E ' s a c t i o n s w i l l i mp a c to n l y L G ' s r e f r i g e r a t o r s , an d

o n l y a l i m i t edv o l u m e o f ap art i cu l ar k i n d o f r ef ri ger at o r a tth at . T h er e w i l l b e n o ef fe ct o nan y

o f LG's
nume ro us oth e r c on sume r a pp lia nc e s, thu s n arr ow ingthe sc op e of any re putatio na l ha

rm . L G also ar g ues that DOE' s actions will cause it significa nt and irre para

ble monetar

y harm. See Pl.'s Mem. at 41- 42. Har m that is "mere ly

economic" is not ge nera lly considere d ir re pa ra ble , s e e Wisc . G a s Co ., 75 8 F .2 d at 67 4, but " unre c ov e ra ble fi na nc ia l lo ss c an c on sti tut eTh e se e sti mate s h ave be e n f ile d und e r s e a l. 13 -25- i rr ep ar ab l e i n

j ury un d er s o m e c i rc u m s t an ce s . " C o al i t i o nfo r C o m m o nS en s e i nGo v 't Procure ment v. United States, 576 F. Supp. 2d 162, 169 n.3 (D.D .C. 2008) (citing case s); see also Br endsel v. Of

fice of F ed. Hous. Enter . Over sight, 339 F . Supp. 2d 52, 66 (D.D.C. 2004). Even a ssuming L G will not be able to re cover monetary damag es fr om DOE, howe ver, th e f i n an c i a l i mp a c tLG c l a i m s i tw i l l s u f f e r d o e s n o tr i s e t o th e l e v e l o f i r r e p ar a b l e h ar m . LG ha s e sti mate d it s p ote nti a l f ina nc ia l lo sse s if

an in jun c tio n d oe s n ot i ssu e . Se e Ka va na ug h D e c l.
a t ¶ 15
. B ut t

he se fi g ur e s r e pr e se nt a

min us c ule po rt ion

of the c omp any ' s w or ldw ide re ve nu e s, 13 see id. at ¶ 4 (L G is a subsidiary of " a $45 billion global tec hnology leade r" ), and a

re no diff ere nt f r o m o th e r f in an c ia l l o s s e s th at h av e n o t r is e nto th e le v e l o f ir r e p ar a b le h a r m. Se e , e . g . , Sa

n d o z, Inc. v. F ood and Dr

ug Admin., 439 F. Supp. 2d 26, 32 (D.D.C. 2006) ( loss of less than 1 perc ent of total sales not irre para

ble har m); Apotex, I nc. v. F ood and Dr ug Admin., 2006 WL 1030151, at *16-17 (D .D.C. 2006) (loss of 1.4 per cent of company' s annual re venue not irr epar able ha rm); B ri sto l- My e rs Squ ibb Co. v. Sha la la , 9 23 F . Su pp . 2 12 , 2 20 -2 1 ( D. D. C. 1 99 6) (" [A] lo ss o f l e ss than 1 per cent of

total sales is not irrepa

rable harm." ). F i n a l l y , LG c o n t e n d s th a tw i th o u tani n j un c t i o ni tw i l l l o s e s i g n i f i c an tm ar k e ts h ar e . It observe s that, following the 2008 Ag ree ment -- whic h temporar ily require d the re moval of Energy Star labels fr om cer

tain L G models -- it lost a sig nificant portion of the Fr ench D oor
re fr ig e rator

mark e t. S e e Ka

va na ug h D e c l. at ¶

11 (a )- (c ). L G f

e ars that D OE ' s a c tio ns wi ll c a us e simil ar disruption this time. But “[c]ourts withi n the [D.C.] Circuit have g ener ally been he sitant to awar d injunctive relief based on a ssertions about lost opportunities and market sha re.” Mylan Pharms., Inc. v. Shalala, 81 F . Supp. 2d 30, 42-43 (D.D.C. 2000) ( citing c ases) . L oss of marke tWhether it is phy sically possible for L G to comply with DOE' s J anuar

y 20 deadline f

or 14 removingthe Ener g y

Star labels is not a question bef ore the Court. The Court notes that DOE ha s r e pr e se nte d to the Court that it " is g oin g to b e re a so na

ble and a ssi st L G" in c omp lyingwi th the ag ency ' s demands. Tr. 80- 81. -26- share is simpl y

economic ha

rm by another name, a nd L G has not shown the sort of substantial financ ial losses that might rise to the le vel of irr epar able ha rm. Henc e, with this case now limit ed to the issue of r emoving the Ener g y Star label fr om a limited volume of ref rig erators alre ady in the marke t, L G has fa iled to establish that it will suffe r irre para ble har m if an injunction does not issue. 14 III. Harm to DOE or to ot her Third Par ties Although L G will not suffer ir repa rable harm if DO E' s actions ar e not enjoined, ne ither DO E n or oth e r t hir d p art ie s w ill su ff

e r a ny sig nif ic ant h arm

if an in jun c tio n is su e s. DO E i ns ist s that, i f t he Court g ra nts L G' s mo tio n, c on sume rs purc ha sin g " mis la be le d" En e rgy

Sta r p ro du c ts wi ll b e ha rm e d thro ug h g re a te r- tha

n- e xpe c te d util ity

bil ls. Se e De fs .' Op p' n at 40 . B ut t his same ha rm ha s a lr e a dy

be fa lle n e ve ryon e wh o h a s p ur c ha se d s uc h r e fr ig e rator s, and DO E a pp are ntl y has no plans to inform " these unfor tunate consume rs," id., that the Energy Star label may

not
acc urate ly

ref lect their r efr ige rators' ener g y usag e, see Tr. at 69- 70. This inaction sug g ests that even D OE believe s the harm to consume rs from a n injunction will be relatively minor. Nor is the Court per suaded that L G' s competitors or DOE will suffer a ny substantial harm if the Court iss ue s a pr e lim ina

ry inj un c tio n. I f D OE ' s a c tio ns are e njo ine d, L G m ay be a ble to char g e a hig her pr ice f

or its remaininginventory of non-Ene rg y

Star compliant ref

rig erators, as they will bear the valuable E nergy Star label. B ut the rec ord is silent as to what financ ial eff ect this would have on other ma nufac turers, which in any event is not likely

to exceed the moneta

ry-27-

ha rm L G w ill inc ur

a bs e nt a n in jun c tio n. An d, the Court ob se rv e s, any

e ff e c t an in jun c tio n w ill have on " DOE' s ability

to enforc e complianc e with the Ene rg y Star criter ia," see D efs.' Opp' n at 42, is wholly

speculative. Thus, this factor w eig hs slightly in L G' s favor
. IV . P ublic Int e r e st Finally , the public intere st factor supports DOE, as the public undoubtedly has a strong i n t er es ti nen s uri n g t h atp ro d u ct s b ea ri n g th e E n er gy

S t ar l ab el h av e m et th e r i go ro u s en er gy eff iciency standards pr escr ibed by

law. L G ar g ues that " ' the public intere st is best served by havingfede ral a g encie s comply with the require ments of fe dera l law.' " Pl.' s Mem. at 44 (quoting Patriot, I nc. v. De p' t of Housing and Ur ban De velop., 963 F. Supp. 1, 6 (D .D.C. 1997)). B ut the Court has alre ady

conclude d that DOE a

ppear s to have fully

complied with the law in this case
. Thus, althoug h of only

moderate re levanc e her e, the Court finds that the public inter est weig hs ag ainst issuing an injunction. CO NC LU SION L G h a s n ot e sta

bli sh e d a lik e lih oo d o f s uc c e ss o n th e me ri ts o f i ts c la ims ; no r h a s it shown that it will suffer irr epar able ha rm without an injunction. Each is a pr ere quisite for the extraordinary

relief L G see ks. Acc ording ly , the Court will deny L G' s motion for a pre liminary injunction. A separa

te orde r ac companies this memora ndum opinion.

/ s / J OHN D. B ATES Un i t edS t at es Di s tri ct J u d ge Date: January

18, 2010