The Merits of the Clean Power Plan Challenge: It all depends on Chevron

Further reflections on the April 16th Oral Argument in Murray v. EPA and West Virginia v. EPA

In an earlier blog entry, I predicted that the D.C. Circuit will refuse, on standard administrative law grounds, to consider the arguments of the petitioning states and coal and utility companies for overturning EPA’s proposed Clean Power Plant rule.  In short, a challenge to an on-going rulemaking is not ripe for judicial review until the agency issues its final rule.

But whether I am wrong or not, the court will surely reach the merits sooner or later, either now, or after the inevitable new lawsuit is filed when the rule is finalized.  What is clear, however, is that there is just no way of escaping administrative law in this case.  Like the jurisdictional issue, the merits would also seem to turn on a question of administrative law, that of the permissible scope of the familiar Chevron doctrine that directs a court to defer to an agency’s reasonable construction of an ambiguous statutory provision.

The battle is over whether Congress gave EPA the power to regulate, under Section 111(d) of the Clean Air Act, greenhouse gas emissions from existing power plants. The petitioners argue EPA lacks the authority because EPA already regulates power plants for mercury emissions under the air toxics section of the law, Section 112, and this kind of “double-regulation” is prohibited by a House amendment to the 1990 Clean Air Act. Commentators generally agree that the House amendment was intended to conform Section 111(d) to the extensive amendments made to toughen the regulation of air toxics.  According to some, the House amendment means that the EPA’s regulation of mercury would preclude EPA from regulating non-toxic emissions from those same plants, including greenhouse gas emissions. 

This sounds crazy.  Why would Congress prevent EPA from regulating harmful emissions from a source category just because the agency has previously regulated some other harmful emission from that same source category under the toxics provision of the law?  As it turns out, Congress enacted a second conformity amendment as part of the same 1990 Amendments.  Under this amendment, which originated in the Senate, EPA is prohibited from regulating, under Section 111(d), emissions of the same pollutant from the same source categories as are already regulated under Section 112.  Thus, read alone, the Senate amendment would not bar EPA from regulating greenhouse gas emissions from power plants under Section 111(d); all that is prohibited is EPA regulation, under 111(d), of mercury emissions.  This makes sense:  the pollutant is already regulated under Section 112, so why regulate the same pollutant twice?

The problem is that the House and Senate conferees never decided which provision is the correct one, but included both in the legislation that passed both houses of Congress, was signed by the President and subsequently included in the Statutes at Large.  When the functionaries in the House of Representatives’ Office of Law Revision codified the 1990 Amendments, they included only the House provision in the U.S. Code.  Thus the Statutes at Large, the controlling document in terms of what Congress enacted into law, seems to be ambiguous on the question of EPA’s authority to regulate greenhouse gases from power plants under Section 111(d).  EPA resolves this ambiguity in the proposed Clean Power Plan by giving effect only to the Senate Amendment and hence the more reasonable interpretation that Congress meant only to preclude EPA regulation, under Section 111(d), of a toxic air pollutant already regulated under Section 112.

The merits administrative law issue is whether agency’s statutory interpretations such as this are entitled to deference by a court.  According to the famous Chevron doctrine, where a statute is silent or ambiguous on a particular question, Congress is assumed to have delegated, to the administering agency, the power to interpret the statute and that interpretation is entitled to deference by the courts so long as it is reasonable.

Sounds pretty on point, doesn’t it? 

Not according to the petitioners’ spokesperson on this issue, constitutional law scholar and Harvard law professor, Laurence Tribe.  Tribe, who is representing Peabody Coal in the litigation, did his level best to argue that Chevron is not applicable to the case.  The professor’s first argument, that there exists no statutory conflict demanding agency resolution, is a bit far-fetched, but his second is less easily dismissed given recent Supreme Court jurisprudence.

According to Tribe’s first argument, no statutory conflict exists since the Senate Amendment is not an “operative” provision of the Clean Air Act, but instead belongs to a class of congressional enactments that make no sense and hence he asserts, should simply be ignored.  Stated Tribe:  “It is not unusual to have an appendix, that says here are some things that are written down in this vast law, that for some reason or another are mistaken.  You can’t do them, they can’t be executed, they ask for something impossible.  If you set them aside to make clear to an ordinary reader that they are not intended to be operative.”

The judges did not seem to buy it.  Indeed, Judge Griffith at one point expressed incredulity at Tribe’s implication that a hundred page separation between two provisions might render one of them “inoperative.”

Judge Griffiths and Kavanagh thus focused on the question of whether precedent compelled them to defer to EPA’s resolution of the House and Senate-originating provisions, assuming they conflicted.

Judge Griffith asked:

But Professor Tribe, do you agree that if we thought they were conflicting statutes, and I realize that you think that they are not, if they were conflicting statutes, then the Supreme Court has told us this is a Chevron case?

Here Tribe harkened to the underlying conditions authorizing Chevron deference – a delegation of lawmaking power from Congress to the agency.  Tribe insisted Congress has never delegated to EPA the power to resolve statutory conflicts, but only the power to issue environmental standards.  “This is not a chevron case,” he said.

But EPA’s lawyer from the Department of Justice, Amanda Berman, disagreed.  Relying on the recent Supreme Court decision in Scialabba v. Cuellar de Osorio, 134 S.Ct. 2191 (2014), she argued that the court owed Chevron deference to EPA’s resolution of the conflict between the House and Senate-originating provisions to give effect to the Senate provision allowing regulation of power plant emissions under Section 111(d) of the Act.

In Scialabba, a plurality of the Supreme Court upheld the Board of Immigration Appeals’ choice between two contradictory statutory provisions in the Immigration and Nationality Act.  In Justice Kagan’s plurality opinion, an agency’s reconciliation of the ambiguity raised by conflicting (“Janus-faced”) provisions merits Chevron deference.  134 S.Ct. 2203.  Although agreeing with the agency interpretation in the case, neither Justice Roberts nor Justice Scalia agreed that Chevron applied.  According to the Chief Justice, “Direct conflict is not ambiguity, and the resolution of such a conflict is not statutory construction but legislative choice.  Chevron is not a license for an agency to repair a statute that does not make sense.”  134 S.Ct. 2214.

Thus the battle over EPA’s authority to regulate greenhouse gases from existing power plants runs right, straight, dab into an unresolved question of administrative law – the permissible scope of the Chevron doctrine.  It would seem that EPA has the stronger case.  A narrow view that refuses to apply the case’s deference principle to an agency’s reconciliation of conflicting statutory provisions would potentially eviscerate Chevron, given that the line between a statutory conflict and a statutory ambiguity is exceedingly hard to draw.  The same holds true of the implicit congressional delegation that justifies judicial deference under the Chevron doctrine.  If the delegation is present with respect to an ambiguous or silent statutory provision, it is hard to see why that delegation would not be present with respect to a statute containing conflicting provisions.  While the court’s probable dismissal of this challenge to the Clean Power Plan as premature means we may not learn the answer to this question right away, the petitioners’ likely challenge of the EPA’s final rule means we will find out sooner or later.