Ninth Circuit Limits Courts’ Power of Equitable Discretion in EPA Suit

On Oct. 22, a Ninth Circuit panel reversed a lower court’s refusal to modify an injunction requiring the Environmental Protection Agency (EPA) to enact rules within a specified timeframe. The environmental case was filed by nearly a dozen states against the EPA for failing to timely promulgate a federal landfill emissions plan.

The states sued after the EPA did not meet its statutorily prescribed deadline. They sought to compel agency action, and were granted an injunction by the district court that required the EPA to act by November 6, 2019. The injunction was stayed pending the EPA’s appeal on the ruling.

Judge Patrick J. Bumatay, who wrote for the appellate panel, noted that “[o]n one level this case is about trash.” He went on to clarify that “this case is not just about trash, landfills, or emissions guidelines; it’s also about the separation of powers and the limits of a court’s equitable discretion.” The opinion explained that Americans dispose of waste in municipal land-fills across the country, which are regulated by the EPA in cooperation with state counterparts. In 2016, the EPA promulgated new landfill emissions guidelines. By doing so, the opinion stated, the EPA “set off a series of mandates for states and EPA,” including its own final rulemaking deadline, scheduled for Nov. 30, 2017. The EPA, however, “blew this deadline,” the opinion reported.

Several states then sued the EPA to compel the roll out of its federal plan. The EPA responded to the suit, and also “kicked off the rulemaking process to extend its regulatory deadline for issuing a federal plan.” While the rulemaking was happening, the district court ruled for the plaintiff states and entered an injunction mandating that the EPA promulgate the plan within six months. A few months later, the opinion explained, the “EPA finalized the rulemaking process, which extended its regulatory deadline by two years.”

The agency then “faced two conflicting deadlines: November 2019 under the court’s order and August 2021 under the amended regulations.” The EPA moved to modify the injunction pursuant to Federal Rule of Civil Procedure 60(b)(5), arguing that “because EPA’s new regulations constituted a change in law, [it] removed the legal basis for the court’s deadline.” The EPA argued that the court’s previously levied deadline was an unfair imposition in light of its action. The district court declined to modify the deadline, instead determining that, “the prior injunction ‘posed no obstacle’ to EPA and that, in spite of the new regulations, ‘all other circumstances indicate that enforcement of the judgment is still equitable.’”

The question on appeal was whether the lower court abused its discretion by “refusing to modify an injunction even after its legal basis has evaporated and new law permits what was previously enjoined.” The appellate panel agreed with the EPA that “[a] shift in the legal landscape,” both removed the foundation for the original order and warranted alteration of the injunction. 

The court, above the states’ arguments, held that this decision respected Rule 60(b)(5) and precedent because the lack of legal basis for the injunction rendered it inequitable. The court reasoned, “[c]ompelling EPA, then, to continue to adhere to an injunction based on a legal duty that has since disappeared is a harm in and of itself.”

The EPA is represented by its Office of General Counsel, and California, Illinois, Maryland, New Mexico, Oregon, Pennsylvania, Rhode Island, and Vermont by their attorneys general offices and environmental regulators.