Opinion ID: 514191
Heading Depth: 3
Heading Rank: 2

Heading: Application of Standing Principles.

Text: 22 It is a commonplace that standing encompasses two components: constitutional and prudential. For constitutional standing, a plaintiff must allege personal injury fairly traceable to the defendant's allegedly unlawful conduct and likely to be redressed by the requested relief. Valley Forge Christian College v. Americans United for Separation of Church and State, Inc., 454 U.S. 464, 472, 102 S.Ct. 752, 758, 70 L.Ed.2d 700 (1982). For prudential standing, a plaintiff usually must show, in addition, that the interest sought to be protected by the complainant is arguably within the zone of interests to be protected or regulated by the statute ... in question, Association of Data Processing Service Organizations, Inc. v. Camp, 397 U.S. 150, 153, 90 S.Ct. 827, 830, 25 L.Ed.2d 184 (1970). Under the zone of interests test, the essential inquiry is whether Congress 'intended for [a particular] class [of plaintiffs] to be relied upon to challenge agency disregard of the law.'  Clarke v. Securities Industry Ass'n, 479 U.S. 388, 107 S.Ct. 750, 757, 93 L.Ed.2d 757 (1987). (An alternative basis for prudential standing, resting on non-statutory interests, is also considered below.) The problem here lies with prudential standing. 23 a. The consumer claims. We have no difficulty finding that the consumer interests represented by the Council are entitled to standing. According to the affidavit of the affected member company's executive, it suffers direct losses as a recipient of contaminated used oils. That the injury is commercial is no obstacle. [S]neering at [commercial] gains by adding 'mere' to them does not make them go away. United States Department of the Air Force v. FLRA, 838 F.2d 229, 233 (7th Cir.1988). Owners of a lake who licensed its use by fishermen and boaters would surely have standing to attack regulatory laxity that led to increased water pollution; there appears no principle by which one could reasonably distinguish the injury alleged here. 24 We will address below the problem of whether the Council is an appropriate representative of the consumer interests of BVER. 25 b. The competitor claims. The Council's competitor claims appear quite similar to those asserted in Calumet Industries, Inc. v. Brock, 807 F.2d 225 (D.C.Cir.1986). There the petitioners objected to the Occupational Safety and Health Administration's decision to adopt a narrow definition of the class of oils that vendors were required to label as health hazards. Petitioners' oils indisputably required such labelling. We found that the interest to be protected by the OSH Act is worker safety ... and not business profits and consequently held that [a]s petitioners here [did] not come before us as protectors of worker safety, but instead as entrepreneurs seeking to protect their competitive interests, we think it plain they lack standing. Id. at 228 (emphasis in original). 26 Here, however, the Council asserts that its interests, though pecuniary, are in sync with those sought to be served by RCRA. In essence they suggest that tightening of environmental standards will generally foster not only a cleaner environment but also the member companies' profits, as it will expand the market for their services. 1 27 The Supreme Court's decision in Clarke leaves the status of this sort of incidental benefit somewhat unclear. Clarke explained that the zone of interests test is not meant to be especially demanding; in particular, there need be no indication of congressional purpose to benefit the would-be plaintiff. Investment Company Institute [v. Camp ], supra [401 U.S. 617, 91 S.Ct. 1091, 28 L.Ed.2d 367 (1971) ]. 107 S.Ct. at 757 (footnotes omitted). 2 On the other hand, it said the test denies a right of review if the plaintiff's interests are so marginally related to or inconsistent with the purposes implicit in the statute that it cannot reasonably be assumed that Congress intended to permit the suit. Id. We must thus find operational meaning for a test that demands less than a showing of congressional intent to benefit but more than a marginal[ ] rela[tionship] to the statutory purposes. 28 The answer may lie in presumptions revolving around the congressional intent to benefit. Where that intent is plain, we may entertain a presumption of standing--a presumption that can be overcome by, for example, a finding that suit by intended beneficiaries would severely disrupt [a] complex and delicate administrative scheme. Block v. Community Nutrition Institute, 467 U.S. 340, 348, 104 S.Ct. 2450, 2455, 81 L.Ed.2d 270 (1984), quoted in Clarke, 107 S.Ct. at 757. In the absence of apparent congressional intent to benefit, however, there may still be standing if some factor--some indicator that the plaintiff is a peculiarly suitable challenger of administrative neglect--supports an inference that Congress would have intended eligibility. Cf. Haitian Refugee Center v. Gracey, 809 F.2d 794, 812-13 (D.C.Cir.1987) (pre-Clarke case stating that the initial inquiry is whether from the face of the statute the interest was arguably intended to be protected or regulated, but that clear evidence in the legislative history of intent to afford or deny standing may rebut the initial answer). 29 Here the Council points essentially to Congress's indisputable intent to encourage proper disposal and recycling of hazardous wastes. See, e.g., 42 U.S.C. Secs. 6901(a)(4), 6902(a)(6). But that intent, of course, shows neither that Congress intended to benefit recycling and disposal firms nor that such firms' interests are more than marginally related to Congress's environmental purposes. Whenever Congress pursues some goal, it is inevitable that firms capable of advancing that goal may benefit. If Congress authorized bank regulators to mandate physical security measures for banks, for example, a shoal of security services firms might enjoy a profit potential--detective and guard agencies, manufacturers of safes, detection devices and small arms, experts on entrance control, etc. But in the absence of either some explicit evidence of an intent to benefit such firms, or some reason to believe that such firms would be unusually suitable champions of Congress's ultimate goals, no one would suppose them to have standing to attack regulatory laxity. And of course a rule that gave any such plaintiff standing merely because it happened to be disadvantaged by a particular agency decision would destroy the requirement of prudential standing; any party with constitutional standing could sue. 30 It is worth remembering that judicial intervention may defeat statutory goals if it proceeds at the behest of interests that coincide only accidentally with those goals. The companion case, Hazardous Waste Treatment Council v. EPA, 861 F.2d 270, No. 86-1658, illustrates the risk that the interests may diverge significantly. There EPA refused to list certain types of used oil as hazardous wastes because it thought this would have the boomerang effect of increasing illegal dumping and thus would result in net harm to the environment. Although the court finds that Congress did not authorize the EPA to consider such an effect, it is a perfectly plausible one. See Martin T. Katzman, From Horse Carts to Minimills, 92 The Public Interest 121, 132 (Summer 1988) (discussing effect of expectation that EPA would list as hazardous waste oil from dismantled cars). When we grant standing to a party with only an oblique relation to the statutory goal, we run the risk that the outcome could, even assuming technical fidelity to law, in fact thwart the congressional goal. Further, of course, technical fidelity to law cannot be assumed; judges err. 31 The risk is present here as well. A regulatory extension sought by the competitor interests in the Council might benefit recyclers' profits (e.g., by forcing the use of more advanced recycling techniques) but harm the environment (because, for example, its cost might lead to substitution of more environmentally harmful fuels). 32 In the absence of any suggestion either of congressional intent to improve the competitive position of high tech recyclers, or of any reason to picture such firms as suitable challengers of the agency, we believe those interests to be outside the critical zone. 33 Of course there are many cases allowing standing to firms whose sole concern is exposure to unwanted competition. For example, the Supreme Court has in a series of cases found standing for competitors claiming to be adversely affected by the Comptroller of the Currency's permissive interpretations of the statutes restricting the activities of national banks. See Clarke, 107 S.Ct. 750; Investment Company Institute v. Camp, 401 U.S. 617, 91 S.Ct. 1091, 28 L.Ed.2d 367 (1971); Association of Data Processing Service Organizations, Inc. v. Camp, 397 U.S. 150, 90 S.Ct. 827, 25 L.Ed.2d 184 (1970). And, in accordance with Clarke 's abjuration of any requirement of congressional intent to benefit, these have not rested on any showing of explicit intent to shelter plaintiffs or their like from the hazards of competition. See, e.g.,Investment Company Institute, 401 U.S. at 629-34, 91 S.Ct. at 1098-1100 (reviewing goals of Glass-Steagall Act). 34 The Court may have inferred congressional approval of such challengers on the view that those whom Congress explicitly sought to benefit would make relatively unsuitable plaintiffs. For example, it is hard to picture a person or firm that could assert injury in the form of the dangers of possible loss of public confidence in banks and the danger to the economy as a whole of speculation fueled by bank loans for investment purposes, 107 S.Ct. at 756-57 n. 13 (summarizing Investment Company Institute 's analysis), said to have been a key evil that the Glass-Steagall Act sought to avert. By contrast, of course, competitors suffer sharp, clear losses when banks invade forbidden territory. To some extent, moreover, the Court may tend simply to assume, without evidence, that entry-restricting legislation is intended to shelter competitors, as legislators might be peculiarly reluctant to articulate a goal of sheltering competitors, no matter how influential it may be. Cf. Panhandle Producers v. Economic Regulatory Admin., 822 F.2d 1105, 1109 (D.C.Cir.1987) (attributing the success of competitors in securing standing to enforce entry-restricting licensing statutes to a substantial congruence between such firms' interests and a statutory purpose to restrict entry, evidenced in part by such statutes' typical origin in the competitor firms' political efforts). 35 The Council here seeks to bring itself under these cases by identifying RCRA as an entry-restricting statute--aimed at excluding from the market providers of less excellent treatment services. But any pecuniary beneficiary of a regulatory program could so characterize it; to accept the characterization as a basis for standing would eliminate the prudential standing requirement. As the consumers of the environmental purity afforded by RCRA seem highly suitable champions of enforcement, and we find no clue of congressional intent to rely on other champions, we find the entry-restriction cases inapplicable. 36 Nor does the fact that RCRA exposes some of the activities of petitioner's members to regulation afford the Council prudential standing. A party is regulated for purposes of the zone test only if it is regulated by the particular regulatory action being challenged. In Calumet Industries, Inc. v. Brock, 807 F.2d 225 (D.C.Cir.1986), where petitioners were clearly subject to the enabling act itself, we found that they lacked standing because they were not directly regulated by the rulings being challenged in this case. Rather, a more appropriate description is that [they] operate[ ] in an industry which is regulated by the rulings but do[ ] not operate in that sphere of the industry which is the object of the regulation. 807 F.2d at 229 (quoting Tax Analysts and Advocates v. Blumenthal, 566 F.2d 130, 143 n. 82 (D.C.Cir.1977), cert. denied, 434 U.S. 1086, 98 S.Ct. 1280, 55 L.Ed.2d 791 (1978)). 37 It is possible that some of the regulations adopted here apply to some members of petitioner. But in view of the nature of petitioner's claim, that does not render Calumet any less relevant. Petitioner wants to increase the regulatory burden on others. Its interest lies in the competitive advantage that its members might secure if the government imposed higher costs on other firms. As noted above, that interest carries a considerable potential for judicial intervention that would distort the regulatory process. As in the prior analysis, we see no special reason to suppose that Congress might have thought them suitable advocates of the environmental interests underlying the statute. 38 Finally, we must consider a line of cases finding prudential standing for those who sell to regulated parties and complain that a regulatory restriction will curtail its opportunities to sell to those parties. See, e.g., National Cottonseed Products Ass'n v. Brock, 825 F.2d 482 (D.C.Cir.1987), cert. denied, --- U.S. ----, 108 S.Ct. 1573, 99 L.Ed.2d 889 (1988); FAIC Securities, Inc. v. United States, 768 F.2d 352 (D.C.Cir.1985). In FAIC Securities then-Judge (now Justice) Scalia endeavored to reconcile the cases seeming to revolve around such a principle. His discussion focused primarily on some conflicting clues among the precedents, but in a footnote he suggested an underlying logic to the cases: the value of judicial protection for the non-statutory rights of such parties to deal freely with the regulated firms: 39 We salute in passing Professor Monaghan's recent admirable effort to bring coherence to the vendor-vendee cases by analyzing them as properly first-party standing cases, seeking to vindicate a freedom to interact with a third person. Monaghan, Third Party Standing, 84 Colum.L.Rev. 277, 299 (1984). If we understand his analysis correctly, it would lead to a conclusion of standing here. [I]t seems plain that either party to a regulated transaction can challenge any limitation in first party terms, because for each party the claim takes the following form: the state has advanced no sufficient interest to justify prohibiting this interaction. Id. at 303 (footnote omitted). 40 768 F.2d at 360 n. 5. See also Columbia Broadcasting System, Inc. v. United States, 316 U.S. 407, 422-23, 62 S.Ct. 1194, 1202-03, 86 L.Ed. 1563 (1942) (broadcasters have standing to challenge regulations that interfere with ability to contract with radio station owners whose licenses would be jeopardized by continuing relations with broadcasters); United States v. Storer Broadcasting Co., 351 U.S. 192, 199-200, 76 S.Ct. 763, 768-69, 100 L.Ed. 1080 (1956) (same); Joint Anti-Fascist Refugee Committee v. McGrath, 341 U.S. 123, 71 S.Ct. 624, 95 L.Ed. 817 (1951). 41 The Council plainly lacks any such non-statutory interests. A firm has no common law interest, much less a constitutional one, in having government drive business its way or in having government force competitors' services to be of the same quality (and cost!) as its own. 42 c. The Council as representative of BVER's consumer interest. Having concluded that the consumer interest of BVER (and any other member companies similarly situated) is sufficient for standing, but that the competitor interests of member companies are not, we must consider whether the Council has standing as a representative of the former. As Hunt v. Washington State Apple Advertising Comm'n, 432 U.S. 333, 343, 97 S.Ct. 2434, 2441, 53 L.Ed.2d 383 (1977), frames the issue, it is whether the interests [the association] seeks to protect are germane to the organization's purpose. 43 The Council's Articles of Incorporation say that it aims (among other things) to promote the protection of the environment through the adoption of environmentally sound practices and methods of destroying and treating hazardous wastes. We have no doubt of its bona fides; one may fervently hope to do good even if he expects to do well in the process. Further, while the fit between Congress's environmental goals and the Council members' competitive ones is not tight enough for the latter to afford the Council standing, the germaneness test is relatively loose. As recently construed by this court, it requires mere pertinence between litigation subject and organizational purpose. Humane Society of the United States v. Hodel, 840 F.2d 45, 58 (D.C.Cir.1988). 3 While the Council's stated devotion to the environment does not excuse it from having to show a specific injury to the members' environmental interests, it does suggest that BVER's interest is germane to the Council's purposes. 44 There remains this problem: HWTC's primary interests have a quite different focus from BVER's interest in consuming relatively clean used oil. In Fortuna's affidavit, for example, there is not a single reference to HWTC members' interests as consumers; the entire focus is on their interest in having EPA create a market for their services--with higher technology and at higher cost. Does the potential split between these and the Council members' interest as environmental consumers render the latter non-germane under Hunt ? 45 Under this court's application of its pertinence test in Humane Society of the United States v. Hodel, 840 F.2d 45 (D.C.Cir.1988), the potential split appears no bar. The court had identified as sufficient for standing the Humane Society's members' aesthetic interests in seeing animals and birds on wildlife refuges, and in not seeing animal corpses and environmental degradation. The Society's articles of incorporation spoke exclusively of the protection of all living things (presumably for their own intrinsic worth), id. at 53, but nothing of the human interest in seeing these living things. The court found the relationship sufficient under its pertinence test. Id. at 59-60. 46 The interests found within the zone in Humane Society are ones that normally, but not invariably, would be seen as part of the broader goal to which the Society was explicitly committed. But one can imagine conflicts: optimal life for a species might require seclusion from human viewers. Indeed the court recognized the potential conflict, but read prior cases to preclude its being treated as an obstacle to the Society's standing. Id. at 59-60 n. 25. There is clearly some tension between this relaxed rule and the prudential insistence that the parties have interests within the statutory goals: if suits by parties with interests outside or at odds with those goals may lead a court to interventions that fail to advance those goals, then so may suits by internally conflicted organizations. But perhaps the duty of the association's directors to represent all elements fairly is thought to mitigate the risk. In any event, under Humane Society the Council appears to be an adequate representative of the BVER environmental consumer interest. 47 d. The Council's standing in its organizational capacity. The Council argues that EPA's alleged illegalities impinge upon a number of its organizational interests: they damage the public trust in, and acceptability of, responsible treatment businesses and technologies; by defeating its efforts to bring about proper management of used oils, EPA's illegalities diminish the Council's ability to attract new members and retain existing members; they diminish its ability to refer potential customers who need treatment services ... to member companies; and, as the challenged decisions exempt certain generators, collectors and blenders from reporting require ments,, the illegalities thwart the Council's ability to obtain information necessary for its educational and promotional activities. HWTC's Supplemental Brief Regarding Prudential Standing at 13-14. 48 Assuming arguendo that these injuries satisfy the constitutional component of standing, all one need say here is that the Council has made no effort whatever to link them to the statutory purposes. Of course RCRA seeks to improve the environment, and, as we have noted, promotion of environmental quality is among the goals of the Council. In the Council's view, this general coincidence of goals should suffice to bring the Council's organizational interests within prudential standing requirements: any decision that disadvantages the Council thwarts RCRA. But plainly this is not enough. If it were, persons with only a generalized grievance[ ], concededly insufficient for standing, see Schlesinger v. Reservists Comm. to Stop the War, 418 U.S. 208, 217, 94 S.Ct. 2925, 2930, 41 L.Ed.2d 706 (1974), could simply form an organization to advance their grievance, and, whenever an agency decision offended their position, secure standing by asserting that it had thrown practical roadblocks in the way of the organization's success. See Haitian Refugee Center v. Gracey, 809 F.2d 794, 813-14 (D.C.Cir.1987) (citing cases). 49 We find that the Council has standing as the representative of BVER's consumer environmental interests. These interests do not encompass the Council's Bevill Amendment contentions, which accordingly we do not reach.