This is Bloomberg Law, with June Brusso from Bloomberg Radio.
The Board was not heedless of environmental effects here. It consulted with dozens of agencies, considered every proximate effect, and ordered ninety one mitigation measures. Eighty eight miles of track should not require more than thirty six hundred pages of environmental analysis.
Former US Solicitor General Paul Clement argued that federal regulators had done enough to consider the environmental impact of a proposed eighty eight mile railway in Utah and shouldn't have to also consider upstream and downstream impacts that are remote in time and space. All parties agree that under the National Environmental Policy Act or NEPA, agencies only have to
consider environmental effects that are reasonably foreseeable. But Justice is across the ideological spectrum struggle with how to define that. What would be the test here? Justice is Elena Kagan, Clarence Thomas, and Chief Justice John Roberts. Here's this eighty eight miles of lying and railroads are going to cross it and wildfires are going to start as a result. Is that within time and space? But how far down line or upstream or downstream should you love.
I have trouble seeing how this is going to work out as a practical matter if you're at the agency or the council for the private party. I mean, what are you going to do. You're going to say, Okay, I've identified this possible issue, but I think it's too far away.
Clement did admit that his proposed test wasn't an easy one.
If I could give you a ten word test that took care of every hard case, I mean, you know, they give me tenure at Harvard, but.
I think you know having I'm sure they give you that any That last comment coming from Justice Kagan, who was once the dean of Harvard Law School. Joining me is environmental law expert Pat Parento, a professor at the Vermont Law and Graduate School. Pat first tell us about the environmental concerns here.
So this case involves a proposed eighty eight mile rail link in the Uinta Basin of Utah, which is huge. In fact, it's as big as Maryland, and it's loaded with all kinds of fossil fuels, including what's called waxy
crude oil. I hadn't heard about that term before, but that's the product that they want to ship on this rail line, and the Surface Transportation Board, which is a federal agency within the Department of Transportation, has the authority to license or approve construction of this link, which will take the oil from the Uina Basin east and connect it with the national railroad network and take it all the way to the Gulf Coast where it will be
refined into various products for both domestic and export consumption. Right, So the concerns here are the drilling and the extraction that's going to occur as a result of providing this critical link. Without this railroad, this oil reserve couldn't be exploited. So it is a major resource with economic value and some jobs undoubtedly and income to Utah and the county. The Youth Tribe of Indians is involved in this, and they have concerns about the drilling which will potentially impact
some of their resources. And there's concerns about spills, which are inevitable when you're moving oil by rail. There's always either chronic low level spills, leakages, or in some cases, of course worse than that, derailments, and we've seen that. But then of course downstream there's concerns about burning all of this spoiled duh and the impacts on climate change, but also impacts on the communities around the refineries in the Gulf Coast Fort Arthur, Texas being as primary focus
of this. So a variety of environmental issues typical of a major infrastructure project like this.
So now tell us about the legal issue here.
So this has to do with the scope of the Environmental Impact Statement that the Surface Transportation Board prepared for this project. And actually STB, as it's called, did you know what you might consider a pretty thorough job. I mean it amounts to literally thousands of pages of analysis when you look at the whole administrative record. The eis itself has many hundreds of pages. I forget it, maybe
nine hundred, but a very substantial document. And they did look at these upstream impacts of drilling and the downstream impacts of potential spills and the refinery, but they only did so to a certain level. And the DC Circuit, when this came to the DC Circuit for review, said, you know, STB, you did an okay job, but not good enough. You needed to delve more deeply into these
upstream downstream issues than you did. So what it comes down to is how much analysis does NEPA require when you have an eighty eight mile project that is approved by this agency, the STB, And how far beyond the footprint, if you will, of the project does NEPA require you to go when you're analyzing these more remote in time and distance problems. And that was the focus of the argument before the Supreme Court.
Was there an answer to what kind of test would work here? I mean, did anyone have that answer?
Yes? Paul Clement, who's a former solicitor generally and I states for a while, so he's a very accomplished, seasoned Supreme Court litigator and frankly did a terrific job representing his clients, of course, who want to develop these oil reserves, and his tests which he offered and explained over and over again to the court. He was up there for almost an hour being questioned by almost everybody on the bench,
and his test was the following. Number one, you do take into account how remote in time and space are the impacts that you're talking about? Number one? And number two, how many of those impacts are actually within the jurisdiction
and authority of the agency in question, namely STV. His answer to both of those was a, the impacts, particularly the refinery impacts, which are five hundred miles away or more, are way too remote in time and distance and speculative in terms of what will actually happen and so forth, and they're subject to other agencies jurisdiction, either state agencies
or federal agencies. Another agency that's involved with rail safety, for example, So when you talk about the condition of the tracks and whether there's the potential for spills, his argument is that's another agency's problem, that's not StB's concern. And refinery operations that's again that's subject to Texas state regulation for whatever that's worth, as well as you know EPA and other agencies. So on his remote in time and space argument, he said, these impacts that the DC
circuit found fault with are not required by NEPA. And number two, he said, when you have these other agencies with responsibilities and STB does not have any authority to control these impacts, then NEPA doesn't require STB to have to analyze them. What's the point he said, of analyzing all this to the nth degree when they can't do anything about it. And so that was his argument.
Did the challengers have a test.
Yeah, so the challengers said, well, first of all, NEPA has always wired consideration of indirect effects, and these are foreseeable indirect effects. And there really wasn't a whole lot of argument. Even Clement conceded, these are foreseeable impacts. They may be difficult to quantify, although the environmental advocates that
they weren't difficult to quantify. I mean, you know how much oil is going to be extracted, and from that you can begin to calculate how much will be refined, and what kind of spills might happen and so forth. You know, the environmental groups challenging this project where I thought, we're able to say, look, what we're asking for here
is not that unreasonable. It's not that different from what courts have required in the past, and it should still be the test here that you know, when the agency undertakes to do an analysis, it needs to do it right. And the response to that, because of course this kept going back and forth like a ping pong match, the response to that is, well, yeah, but what you're doing is punishing the agency STB for agreeing to consider things that it really doesn't control, and that can't be right.
So Clement also suggested that the Court could adopt what's known as the harmless error rule. Right. So what he's saying is all right, So STB didn't have an initial obligation to consider these impacts, but it did so voluntarily, and you shouldn't punish them for that, particularly when we said when you're flyspecking. That was the term he used flyspecking the analysis. So you know, here's what I would say as the bottom line. There's no support on the bench,
either liberals or conservatives, to uphold the DC Circuit. That was clear. The liberal wing of the bench asked as many difficult questions of the environmental group and the environmental advocate as did the conservative justices, in some cases even more aggressive.
Right.
So they were clearly signaling they were not going to be upholding the DC Circuit. And my reading is what they were really signaling to the rest of the conservative colleagues on the bench was, let's see if we can find a basis to overturn the DC Circuit's decision and allow this project to proceed that doesn't do any more damage to the NEPA process than quote is necessary to decide this case. So that's what I'm going to be looking for, not what the outcome is. The outcome's clear.
You know, NEPA has been in front of the Supreme Court fifteen different times and has lost every single time. This will make the sixteenth time that NPA will have lost in the Supreme Court. That seems foreordained to me. But the real question is how broadly is the court going to go in limiting the scope of NEPA analysis In a variety of other cases, this is just you know, one eighty eight mile rail line, right, But NEPA applies to a huge number of federal actions, of course. So
that's what I'm going to be looking for. Will they write a narrow opinion, overturn the DC circuit, let this project be finished, and leave it the rest of it alone.
Coming up next on the Bloomberg Law Show, I'll continue this conversation with Professor Pat Parento of the Vermont Law and Graduate School. What happens to environmental reviews under the upcoming Trump administration. I'm June Grosso and you're listening to Bloomberg. Supreme Court seems almost certain to limit the scope of environmental impact studies. The question is how the Court will
do so. The justices at oral arguments overwhelmingly suggested that the US Court of Appeals for the DC Circuit went too far when it required federal regulators to look at potential effects on communities on the Gulf Coast in considering whether to approve an eighty eight mile railway in Utah. I've been talking to Professor Pat Parento of the Vermont
Law and Graduate School. Did it seem like some of the justice is thought that they didn't need to adopt a new test, that they could clarify the old one instead. Justice amy Cony Barrett said maybe the Court should just say what we've said before, but maybe put a little bit more flesh on the bone.
Yes. In fact, she and Justice Kavanaugh both stressed that when you have a question like this of the scope of NIPA analysis and it's tied to the authority of the agency in question, right, that you should defer to the agency's determination of what's an appropriate scope, and only where that determination can be shown to be arbitrary and capricious. That's the sort of standard review test under the Administrative Procedure active course. Only where you can show that you
know the agency made basically interrational determination of scope. Should the court step in, Kavanaugh said, in light of the re sense passage of what's called the Builder Bill by Congress, this is the Infrastructure Bill, And in that bill they actually amended NEPA in a variety of ways, including putting a page limit on environmental impact statements of one hundred and fifty pages and putting a time limit on how long the NEPA process could take, namely one year for
certain kinds of important projects. And this kind of a project would be included as a critical sort of energy infrastructure project. Right, So Kavanaugh referred to that passage of that law and said, you know, there's no way agencies can do everything that the DC Circuit is requiring them to do in one hundred and fifty pages in a year's timeframe. So he said the court should be giving different squared was the term he used to agency interpretations
of the scope of their analysis. So, yeah, I think if this case, you know, comes out doing minimal damage, let's put it that way to NEPA, it will be for the Court to refer to this new congressional act, the Builder Bill, and emphasized that courts should not be second guessing agencies when they determine how far they're going to go, and analyzing these indirect effects, taking into account
time and distance and authority and so forth. So I can anticipate seeing a decision that lays out more clearly the role of the courts in reviewing cases like this and limiting judicial review, but maybe not going so far as to adopt Clements tests, which would be a very significant narrowing of NIPA analysis, and one in which the Biden administration, of course, in their argument because they're the defendant the STB is the defendant in the case, did
not agree with Clement's tests. Edwin Needler, also a former Solicitor General, argued the case for the Biden administration and tried his best to distinguish his approach and the Biden administration's approach from what Clement was proposing. But frankly, that doesn't matter, does it. In light of who's coming to office in January. The views of the Biden administration will have no bearing whatsoever going forward.
So just back to Kavanaugh and the deference squared, he said, it seems to me the difference of the courts has to be huge with respect to how the agencies think about the scope of what they're going to consider. How does that fit in with this court that last term throughout the Chevron doctrine, and you know, deference to agencies interpretations of ambiguous statutes. Now they're willing to give deference.
Well, you know, they're all saying consistency is the hob goblin of small minds. So yeah, there's a little bit of inconsistency there, right, So we will defer to agencies when we like what they're doing, but not differ to them when we don't. I'm not going to go completely cynical on that, although I'm tempted, but certainly there's tension here between when you're going to give an agency difference
and when you're not. So I would say this that when it comes to this narrower question of what's the scope of analysis with these indirect effects, these are you know, admittedly there's some speculation about exactly what these effects are going to be and how they're going to be handled by a variety of different agencies that have authority. So you know, this is a gray area of nep law. I have to say, and you know, reasonable people, I
suppose can disagree about how far you should go. If I'm arguing the other side of this, what I'm going to say is, look, STD has a very clear binary decision here, right, either approve the new rail line or not. In the final analysis, It's a yes or no question. And to answer that question, you have to balance the benefits, economic and otherwise of the proposed rail line and the costs,
including environmental costs. And I would argue including climates costs. Right, So I can make the argument that this is perfectly reasonable to require STV to look at lots of things that it doesn't control, because the one thing it does control is whether to allow this project to be built, and that turns on water. It's net and overall benefits
versus its costs. Right, So you can make an argument, I think, And I've made these arguments in my past life because I wrote an odd article called small Handles. When do federal regulations privatize actions by others? And so I've made the arguments that it doesn't really matter what the scope of the agency's authority is. The question is
should they approve this project or not? And that requires looking at as many things as you can reasonably consider, not looking at things that are purely speculative or you know, angels on ahead of a pen kind of calculations. But those things that you can reasonably foresee and calculate and way in the balance should be weighed. But that's not
where this case is going to come out. I'm just telling you an alternative view of what NIPA might require of an agency like this, even though it doesn't control everything that happens as a result of its decision.
So we should mention that Justice Neil Gorsitch recused himself just last week.
Yes, so he did not say why. The speculation is that he or his family may have a financial interest in one of the parties that would benefit from this rail line. That's the speculation. But given credit, he was asked to refuse by the respondents who were, you know, the environmental concerns here, and he did, so, you know, we kudo to Neio Gorsics for that. I would say I.
Would too, especially considering how many times Justices Alito and Thomas have been asked to recuse and they haven't.
Yeah, at least one has paid attention to the sort of concern about ethics on the bench. But there's still five there's still five Conservatives, so there's clearly five votes to overturn the DC circuit. As I say, the question is how are they going to do it and will the Liberals have some influence on that? Can they convince their colleagues to limit the reach of whatever decision they make?
So you mentioned the upcoming Trump administration. Do you think that they will just ignore any climate action at the federal level? I mean, what's the thought about how they might approach the environment.
Well, you know, we might be happy if they did just ignore it, but they're not going to just ignore it. They're going to turn the clock back. They're going to reverse everything Biden did. They're going to try to claw back money under the Inflation Reduction Act. They're going to repeal the power plant rule, the tail pipe rule, the methane rule. They're going to require maximum oil and gas leasing both offshore and onshore on public lands right down
the list. What they're proposing to do, and they're putting the people in place to do it, is to turn us completely around and go in the absolute wrong direction. Instead of facilitating the transition to a clean energy, clean transportation economy, which is well underway right instead of facilitating that, they're going to throw up roadblocks and try to stop it. It's really, frankly, to use a not technical term, insane
what they're talking about. It doesn't make sense, economically, environmentally, public health. None of what they're talking about makes sense. Do some of these programs need improvement, of course they always do. Should Congress update some of these statutes to take account of new ways of dealing with these problems, of course they should. Should the federal government put some money into helping industry clean up, Yes, and so on.
But that's not what we're going to see. I'm sure we're not going to see that.
Can they do that in four years if they pay attention to the requirements of the law, the Administrative Procedure Act, et cetera.
Well they didn't the last time, and Trump won. Of course, they lost most of their cases, almost eighty percent of the challenges. That this time around, their trying looks to learn from their mistakes, we'll see. You know, the top level people they're talking about are not capable. I don't think of implementing what Trump is talking about. So the real question is going to be who are they bringing in in the you know, second and third tiers of EPA,
Department of Interior, Department of Energy, and so on. That level you know of the agencies is where the action is. And you know, if they get really capable people who have some experience in government with these agencies, then I do worry. And if they start, as I think they will, start driving out some of the career professionals, particularly for my old agency at EPA, people I know and admire greatly.
If those people have had enough and are second tired of being abused and threatened, which they are being threatened, they're going to leave. And we're seeing that already. I'm seeing it because they're showing up on our doorstep asking for jobs at Vermont Law School, right, So that's a big concern. If they drive out the real professionals from these agencies and replace them with quote Trump loyalists, we're in serious trouble. Then we're talking about permanent damage to
some of these institutions. That does worry me greatly, even more than what they're going to try to do with regulatory rollbacks, because we do have courts out there still, there are still good judges out there who are not going to let them run rampant over the rule of law and just do whatever they want, regardless of what the law and the APA requires. If they try to do what they did or they're gonna get stopped, They're gonna get slowed down. And in this case, delay is everything.
The more that you can delay what Trump is trying to do, the more he becomes a real lane duck. And then that the midterm elections kick in, and then we see if maybe there's a turning point that will further limit the damage that Trump is threatening against environmental programs.
President Joe Biden has said nobody can reverse the clean energy solutions that are already underway in this country. We'll see what happens come January. Thanks so much, Pat. That's Professor Pat Parento of the Vermont Law and Graduate School. Coming up next on the Bloomberg Law Show. Why is there an uptick in divorces after the Holidays? I'm June
Grosso and you're listening to Bloomberg. 'tis the season, and you might notice an uptick in engagements of happy couples, But once the tree comes down, it's an uptick in divorces. You'll likely see. Joining me is an attorney who handles matrimonial and family law matters Lauren Crane. She's a partner at Bender and Crane, a female owned boutique law firm in New York. So is the holiday season a popular time for people to get engaged.
A lot of people do get engaged in the holiday season. And typically people who do get engaged, they look forward to getting married and they start to plan forward, and it's really a celebratory time. But people who are getting engaged think about whether they get engaged on a holiday or not. So if you get engaged and you give someone an engagement ring on a holiday versus on any other day, if you actually don't get married, the ring and the purpose of the ring could become subject to
a hearing. If one person says they were given a gift of an engagement ring on Christmas or New Year's versus another day, then it would be the person who gave the ring it would be their property.
So after the engagement, the question of a prenup comes up. So a young couple starting out, neither of them has any substantial assets, do they really need a prenup?
So it also depends on whether they have multi generational wealth. So a lot of times, people who haven't started working yet but their parents have money, they set up trusts, and those trusts can be the issue of litigation long term and a divorce, at least in New York. So if you're going to inherit money or you're a beneficiary of a trust, then you should look into a prenap. Also, if you have interest in a business that hasn't yet taken off, but you've been creating this business long before
you got engaged. That business you've put sweat equity into and you may want to protect that in the case of a divorce.
Let's say you have two people who are in graduate school or law school. Yeah, no assets, do they need a prenup?
So in that case, again, I don't have so many facts about their ass that's outside of being in school. But if you already have a case where the parties one of them wants to work long term, one of them doesn't want to work, you know, there's lots of decisions you're going to make through a marriage, and so sometimes it's even easier just to set it out before you get married and set it out in a prenup. We've had that a few times in our office.
And what does a prenup cover.
Generally, so, a prenup can cover anything that the couple wants as long as it doesn't cover child's support or child's custody. So it can cover, at least in New York, spousal support, equitable distribution, which is how you would divide your assets once you get married. Can cover council fees in the event of the divorce, whether one person is waiving their right to receive counsel fees in the long term. It can also cover state rights upon a person's death, so it can cover a array of issues.
In the movies, prenups cause problems. In real life does it cause problems?
So prenups sometimes do cause problems, but remember these are problems that people would face once they get married. People go into a marriage or a wedding and they envision their wedding day, but they don't envision the next day when they have to budget to pay for a house or a vacation or any of your ongoing expenses. So although you look forward to the wedding, you don't think about the next steps that once you're married, and then, in the unfortunate stance that you actually do get divorced,
then they don't think about that. But prenups are conversations that couples are going to have in the long term, whether they have it before they get married or after they get married.
What about getting a post nup instead of a pre nup?
So we've done a few post nups in our office, and they sometimes are post nups just to sity. You know, how you envision certain property that you acquire during the marriage would proceed. But there's a lot more documents that have to be exchanged because you're already married, versus a prenuptial agreement when you haven't yet been married.
So is there any point in doing a post up or just wait for the divorce?
So in some instances a postnup would work. If someone's gifting the money to a child, a parent is gifting money to one of the spouses and they want to buy a house, and the parents want to ensure that that house goes to the person they're gifting in the event of a divorce. Or sometimes you know, people have resets in their marriage, so they do a ponent agreement, but it doesn't automatically lead to a divorce. So it's very different than a divorce.
Do you find that after the holidays people split up more? So?
I think that sometimes when you go from the Thanksgiving holiday to the Christmas holiday, people are spending a lot more family time, and so sometimes that can awaken them to realize that maybe they do want to get a divorce. And before they would get a divorce, you should always consult with you know, one or two attorneys and make sure you meet an attorney that you like and you
fit with, and then you can proceed to plan. A divorce doesn't happen overnight because remember you're married, so you know a lot of people who have kids, they don't want to ruin a Christmas holiday or a vacation that they have planned during that time. So typically we see an uptick of calls to discuss the possibility of having a divorce after Thanksgiving, and then people tend to file for divorce after Christmas.
Do more people file for divorce when it's a boom economy or more people file in a recession? If you know?
So in New York it doesn't matter in our particular cases because typically people have large wealth in Manhattan. Our typical clients, you know, our private school parents who can afford the lifestyle in New York, so a boom or a bus economy doesn't really affect our business in that way.
I've heard this term gray divorce boom. What is that?
So that's the after the kids have left the house, when they've graduated and you know, their kids have gotten married. Some families are starting more families are starting to get divorced later in life. And the reason is is people tend to reevaluate their lives later. People I think are living longer and they've come to the realization that they want to die married to this person, so they want to get divorced later in life, even though it may be more complicated.
You think it's more complicated because if the kids are out of the house, doesn't that take one big factor, you know, one troublesome fact out of the divorce.
Yes, But then you have a much longer term marriage. So then there's an issue of spousal support if one person didn't work, and how long they would pay spousal support for. And also, as you're married longer, your assets become more and more entangled, so it may not be so easy to piece apart all of your assets. You know, you may have investments in private equity funds that you
can't easily retrieve. It can't happen a short term marriage, but in a longer term marriage, the longer you're married, the more entwined your assets are.
In most divorces, is it the children that are the biggest issue or.
Is it money, So that really depends on the case. A lot of times parents are able to come together and realize that they're separating, and they try and protect their children from the being intricately involved in their divorces, such as getting an attorney for the child or testifying before a judge and closed chamber. So they choose to settle that issue very quickly through either a mediate or some use a family therapist, and so that issue can
be taken off the table. However, in cases of high conflicts, where maybe there's abuse or the people never were able to communicate very well together, that can make custody much more involved and it can last much longer, so it can become much more contested. As they say, however, it also involves money because children cost money, so at times
they're intertwined. So if one parent has more money, or one parent has less money, or they earn equally, it can be how expenses are paid for the kids, so it can become more complicated.
Have you seen any changes in divorce, any patterns that are different in the last let's say ten years or so. Or is divorce still divorce?
Divorce is still divorce no matter what time or what date. But divorce is still messy. And however, it's really guided by the two people who are married, and they should try and work together. Cases do tend to linger longer in the court system.
Now.
The divorces right now in New York can take between two and six years to actually finalize. So I would say that that is the only biggest changes that now it's taking significantly longer. I don't know if it's due to more filings or the reason that they do tend to take longer.
That's a long time to wait for a divorce. So I also wanted to talk to you about no fault divorce. How many states have no fault divorce?
All fifty states have no fault divorce. New York was the last to get no fault divorce and that was in twenty ten.
And are some states moving or thinking about or trying in some way to get rid of no fault divorce.
I hope they're not because no fault divorce would only clog court systems more. And also when I was practicing before twenty ten, we had one case that was going to go to trial over a false divorce. Now, in a false divorce, you can have a jury trial, unlike just a divorce matter, where a jury could decide whether one person can prove that they have the grounds as they call it, to get a divorce, such as cruel
and usual punishment, stuff like that. They can they can try and prove that they were abused, and it can retrigger the person who has been abused. It's a horrible
process fault divorce, if you think about it. If a person has to prove that the other that their spouse was horrible to them during their marriage, and they have children, no matter the age of the children, these two people are eventually going to sit at their children's and they are going to remember everything that was testified at that trial, which will have nothing to do with their children, but just how they treated each other during their marriage, which
would prevent them from actually working together for the benefit of their kids and their grandkids.
That's one change in the Law. I guess we can applaud thanks so much for coming on the show. Lauren. That's Lauren Crane of Benderin Crane. And that's it for this edition of the Bloomberg Law Podcast. Remember you can always get the latest legal news by subscribing and listening to the show on Apple Podcasts, Spotify, and at Bloomberg dot com, slash podcast, slash Law. I'm June Grosso and this is Bloomberg