Episode description

In this case, the court considered this issue: should the Court stay the EPA’s federal emissions reduction rule, the Good Neighbor Plan, and are the emissions controls imposed by the rule reasonable regardless of the number of states subject to the rule?   

The case was decided on June 27, 2024.

The Supreme Court held that the EPA’s enforcement of the Federal Implementation Plan against the applicant States is stayed pending disposition of the applicants’ petition for review in the D-C Circuit and any petition for writ of certiorari, timely sought. Justice Neil Gorsuch authored the 5-4 majority opinion of the Court.

There is a four-factor test for deciding whether to grant a stay: likelihood of success on the merits, irreparable harm, balance of equities, and public interest. The Court focused primarily on the first factor—likelihood of success on the merits—and concluded that the applicants (states and industry groups challenging the EPA's rule) were likely to succeed in arguing that the EPA's Federal Implementation Plan (FIP) was “arbitrary” or “capricious” under the Clean Air Act. 

The EPA failed to adequately explain why its emissions reduction requirements would remain appropriate if fewer states were covered by the plan than originally intended. Commenters had raised concerns during the rulemaking process about what would happen if some states dropped out of the plan, but the EPA did not sufficiently address these concerns. While the EPA did add a “severability” provision saying the rule would continue to apply even if some states dropped out, this did not actually address the underlying issue of whether the emissions requirements would still be justified with fewer states. Because the EPA likely “ignored an important aspect of the problem” by not explaining why its emissions reduction requirements would remain appropriate with fewer covered states, the applicants were likely to succeed in having the rule "reversed" as arbitrary and capricious, justifying the stay pending further review.

Justice Amy Coney Barrett authored a dissenting opinion, in which Justices Sonia Sotomayor, Elena Kagan, and Ketanji Brown Jackson joined, arguing that the applicants are unlikely to succeed on the merits of their challenge to the EPA’s rule. Justice Barrett rejected the Court’s theory about EPA’s failure to explain as underdeveloped, plagued by significant procedural obstacles, and contradicted by evidence in the record. Justice Barrett argued that the EPA’s methodology for calculating emissions limits appears to be independent of the number of states covered, and that the Clean Air Act’s stringent harmless-error rule would likely prevent the applicants from prevailing even if there were a procedural error. She also criticized the majority for granting emergency relief based on a theory that was not fully briefed or argued.

The opinion is presented here in its entirety, but with citations omitted. If you appreciate this episode, please subscribe. Thank you.