//  7/12/17  //  Commentary

Last week, in Clean Air Council v. Pruitt, a divided panel of the D.C. Circuit blocked an attempted suspension of some important methane-emission regulations.  The decision garnered some press as an example of the judiciary checking the Trump Administration.  That’s true, but the details of the Court’s reasoning are important.  The decision strikes me as an airtight (so to speak) application of some basic principles of administrative and constitutional law that I’ve been harping on in my scholarship over the past few years (see here, here, and here).

In particular, Clean Air Council powerfully vindicates the basic principle that while agencies may have discretion over how laws are enforced, they cannot use that enforcement discretion to cancel legal obligations altogether.  This issue arose repeatedly during the Obama years in contexts with opposite political alignments (such as immigration and administration of the Affordable Care Act).  Clean Air Council helps illustrate why the correct principles matter as a constraint on executive unilateralism.  Let me explain.

First, some background on the case.  The regulations at issue imposed new standards to prevent fugitive emissions of methane (an important greenhouse gas) and other pollutants by the oil and gas industry.  The rules took effect, following public notice and consideration of comments, in August 2016.  Among other things, the new rules required regulated entities to complete certain surveys for leaks by June 3, 2017.

Several industry groups petitioned the agency to reconsider the regulations.  Although agencies often have broad discretion to deny such petitions for reconsideration, in this case the statute required reconsideration in some circumstances.  If such reconsideration was warranted, moreover, the statute authorized EPA to stay the regulation for up to three months.

In April 2017, Trump’s new EPA Administrator, Scott Pruitt—a climate change skeptic and proponent of environmental deregulation—announced that he believed the petitions had merit.  Two months later, on June 5, 2017, EPA published a “[n]otice of reconsideration and partial stay” granting reconsideration of four aspects of the regulations and staying the pertinent provisions’ effect for ninety days pending reconsideration.  Rather remarkably, the stay applied not only prospectively, but also retroactively to June 3—so as to let entities that hadn’t completed their leak surveys off the hook.

By a 2-1 vote, the D.C. Circuit held that this administrative suspension of the regulations was unlawful.  (Judges Tatel and Wilkins joined an unsigned majority opinion, while Judge Brown dissented.)

To get to this result, the court first concluded—correctly—that the regulation was reviewable, that is, subject to judicial review and potential invalidation.

Under the Administrative Procedure Act (APA), courts can generally review only “final agency action,” meaning (the Supreme Court has said) action that (1) “mark[s] the consummation of the agency’s decisionmaking process” and (2) is “one by which rights or obligations have been determined, or from which legal consequences will flow.”

EPA argued that the stay was not final agency action because it merely spared regulated parties from compliance while the agency thought about what new policy (if any) to adopt.  Embracing this view, Judge Brown wrote in dissent:  “EPA is not ordering anyone to do anything.  The agency is merely announcing that it has decided to allocate its resources towards reconsideration rather than enforcing the rule.”

The majority correctly rejected this characterization of the stay.  Issuing the stay was not just a choice about enforcement—about whether to allocate resources to enforcing the rule.  The stay was a change in the law.  As the majority explained:  “Absent the stay, regulated entitles would have had to complete their initial monitoring surveys by June 3 and repair any leaks within thirty days.  Failure to comply with these requirements could have subjected oil and gas companies to civil penalties, citizens’ suits, fines, and imprisonment.”

Think about it:  the two decisions—whether to reconsider and whether to enforce—aren’t even necessarily linked.  EPA could devote resources to enforcing the rule while reconsidering its merits, or alternatively it could decline to reconsider the rule despite choosing to give the rule’s enforcement low priority.  What matters practically—and should drive the reviewability analysis—is that the stay altered regulated parties’ legal obligations rather than just the likelihood of those obligations being enforced.

Back in 2014, I emphasized this distinction’s importance in this article on enforcement discretion.  Under basic separation-of-powers principles, agencies may presume some discretion to decline enforcement of governing laws in particular cases, but they cannot alter or eliminate legal obligations themselves unless Congress has given them authority to do so.  Our Constitution, after all, obligates the President to “take care” that federal laws are “faithfully executed.”  What’s more, as I explained in this follow-up article, this boundary between law and enforcement policy is also one that courts can and should enforce—just as the D.C. Circuit did here—even if in general courts are reluctant to review agency enforcement choices.

That brings me to a second key feature of Clean Air Council:  the court’s decision the merits.

Although the governing statute in the case authorized a stay in some circumstances, the court found those requirements were absent.  So EPA fell back on a claim that in any event it held “inherent authority” to temporarily suspend the regulations.

That is wrong too, for the same reasons I just outlined.  Executive agencies’ job is to execute the laws they administer.  Executing the law does not entail power to cancel it.

Now, the laws here were of course regulations promulgated by an administrative agency, rather than statutes enacted by Congress.  That means the agency does have power to change them.  But changing regulations adopted through notice-and-comment procedures generally requires a new notice-and-comment rulemaking.  Without a new statute or final regulation, rules like the methane regulations have the “force and effect of law.”

At this point, some clever (or cynical) readers may well be asking themselves:  “Who cares?  Surely the oil and gas industry doesn’t need to worry about enforcement by Scott Pruitt’s EPA!”

That may or may not be true.  But even if it is, the court’s decision still matters.  As I explained in this article and these blog posts (here and here), regulated parties generally cannot rely on agency assurances about their enforcement plans.

Even if an agency indicates it won’t enforce a law or regulation and then reneges on that promise, regulated parties lack any legal defense based on their reliance.  Why?  Because otherwise agencies could make an end run around the limits on agency authority I just described.  They could change the law and license legal violations—even without authority for doing so—simply by inviting reliance on promises that the law won’t be enforced.

In this case, it might be true that the Trump EPA won’t enforce the methane regulations.  But would you bet your company on that?  And what if a new sheriff comes to town in a few years?  A new administration might well beef up environmental enforcement, much as this administration is beefing up immigration patrols.  Even in the meantime, moreover, in this context private citizen suits may be available to enforce the regulations.

All in all, then, the D.C. Circuit’s decision in Clean Air Council correctly applied some important legal restraints on the executive branch, and it just might keep some methane out of the atmosphere too.  Those are both things to cheer.

Versus Trump: Going to Church In Times of COVID

12/7/20  //  Commentary

On this week's Versus Trump, Charlie and Jason discuss the recent Supreme Court decisions requiring states to allow in-person religious services even while other gatherings can be banned. The pair gently disagree about how hard or easy these cases are. Listen now!

Jason Harrow

Gerstein Harrow LLP

Charlie Gerstein

Gerstein Harrow LLP

Versus Trump: Legal Update + The GSA Travesty

11/17/20  //  Commentary

On this week's Versus Trump, Charlie and Jason discuss the status of Trump's legal challenges to the election (going nowhere) and the Trump Administration's dangerous and illegal refusal to designate Biden as the President-elect and therefore give his team resources for a smooth transition. Listen now!

Charlie Gerstein

Gerstein Harrow LLP

Jason Harrow

Gerstein Harrow LLP

Trump's Lawyers Should Be Sanctioned

11/11/20  //  Commentary

Lawyers who bring cases without evidence solely to harass or delay should be sanctioned. It's what Justice Scalia would have wanted.

Jason Harrow

Gerstein Harrow LLP