Utah and PacifiCorp Request Rehearing in Sierra Club v. EPA Administrative Action Suit

Two intervenors, the State of Utah and PacifiCorp, have requested that the Tenth Circuit revisit a July opinion rendered in favor of the Sierra Club regarding a final administrative action taken by the United States Environmental Protection Agency (EPA). The petitions, filed on Tuesday, chiefly contend that the appellate decision conflicts with other federal case law.

In its July 2 opinion, the Tenth Circuit vacated the EPA’s so-named “Hunter Order,” and remanded the petition to the EPA for further consideration. According to the ruling, the lawsuit involved the interpretation of an environmental regulation governing permit renewal under Title V of the Clean Air Act (CAA).

“The statute and accompanying regulation allow renewal of these permits only if they ensure ‘compliance with’ all of the ‘applicable requirements,’” the appellate opinion stated. The controversy, it explained, arose from the term “applicable requirements,” which is defined in the regulation, but not in the statute. According to the judgment, “(t)he Sierra Club interprets the regulatory definition to require compliance with all existing statutory requirements; the EPA interprets the regulatory definition more narrowly, arguing that the applicability of certain requirements is determined by the state permit issued under a separate part of the Clean Air Act (Title I).”

The Tenth Circuit panel sided with the Sierra Club, holding that “(t)he regulatory definition of ‘applicable requirements’ includes all requirements in the state’s implementation plan, and Utah’s implementation plan broadly requires compliance with the Clean Air Act. So(,) all of the Act’s requirements constitute ‘applicable requirements’ under the regulation.”

Utah’s petition for panel rehearing or rehearing en banc contended that “(t)his proceeding presents questions of exceptional importance…” First, it argued that the panel’s opinion conflicts directly with the Fifth Circuit’s decision in Environmental Integrity Project v. United States EPA, an Aug. 13 rendering, “which interpreted the same EPA order at issue in this case, and more broadly with decisions of other circuits.”

Second, Utah contended that it must now “defend a permit approval decided 23 years ago and will be saddled with similar challenges for which neither the CAA Title V nor the Opinion provide any guidance,” because the ruling opens the door for substantive re-review of previous permitting decisions. Third, the intervenor claimed that the panel misunderstood aspects of Utah’s State Implementation Plan (SIP) and “overlooked the difference between the extensive procedures Title I requires through Utah’s SIP for major New Source Review and the much more limited review and timeline provided under Title V.”

PacifiCorp, an electrical power company serving the western United States, requested rehearing on basis that the opinion “conflicts with Tenth Circuit law regarding statute of limitations, laches, and the appropriate level of deference accorded to federal agency interpretations of statutes.” Similarly, the intervenor argued that the ruling “conflicts with Supreme Court case law and federal regulations regarding the scope and nature of permit review under Title V of the Clean Air Act ( ), as well as Supreme Court case law regarding laches.”

Utah is represented by the Office of the Attorney General for the State of Utah, and PacifiCorp by in-house counsel and Ray Quinney & Nebeker.