928 F.3d 1041
D.C. Cir.2019Background
- RCRA's Subtitle C regulates "solid waste," defined as "discarded" material; Congress also aimed to encourage recycling and reclamation as alternatives to disposal.
- In 2008 EPA adopted a Transfer-Based Exclusion (TBE) excluding certain hazardous secondary materials sent to third-party reclaimers from Subtitle C when they met Transfer Conditions and Legitimacy Factors to ensure legitimate recycling.
- EPA replaced the TBE with a more restrictive 2015 Verified Recycler Exclusion; the D.C. Circuit vacated parts of the 2015 rule in API III and reinstated the 2008-style TBE, later expanding it in API IV to cover spent refinery catalysts.
- EPA reissued a modified Transfer-Based Exclusion in 2018; environmental groups challenged the reissued TBE as exceeding EPA authority and as arbitrary and capricious.
- Petitioners argued payment from a generator to a reclaimer proves "discard" (bringing the material within Subtitle C) and that EPA failed to justify treating transferred materials differently from waste destined for storage/treatment/disposal.
- The court considered threshold defenses (standing, waiver, timeliness, claim/issue preclusion, stare decisis) and rejected them, then addressed Chevron deference and arbitrary-and-capricious review on the merits.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether materials a generator pays a reclaimer to accept are necessarily "discarded" under RCRA | Payment shows negative value and is dispositive evidence of "discard" bringing materials under Subtitle C | Statute ambiguous on this point; payment is not dispositive; EPA may permissibly treat legitimately recycled materials as not "discarded" when conditions are met | Court: Chevron deference applies; EPA reasonably construed "discarded" to exclude materials meeting Transfer Conditions; payment is not necessarily dispositive |
| Whether EPA's Transfer-Based Exclusion is arbitrary and capricious for treating transferred recyclable materials differently than waste sent to disposal | TBE treats similar materials differently without reasoned explanation; Transfer Conditions insufficient per EPA's prior findings | EPA articulated differences: legitimately recycled materials are not part of the disposal problem and Transfer Conditions address transfer-specific risks | Court: EPA provided a reasoned explanation and adequate safeguards; not arbitrary and capricious |
| Standing of environmental petitioners to challenge the 2018 reissued exclusion | Petitioners: members suffer concrete aesthetic and recreational injuries from increased risk; injuries traceable and redressable | EPA: challenges to earlier rules make petition untimely/speculative | Court: Petitioners have organizational standing based on members’ reasonable fears and behavioral changes |
| Timeliness / preclusion defenses to challenge | Petitioners: challenge is timely under "after-arising grounds" because rule developments re-ripened claims | EPA / intervenors: challenges to 2008/2018 rules are untimely or precluded by prior proceedings | Court: Timely under the after-arising exception; claim and issue preclusion/stare decisis do not bar suit |
Key Cases Cited
- American Mining Congress v. EPA, 824 F.2d 1177 (D.C. Cir. 1987) (materials kept in an ongoing production stream are not necessarily "discarded")
- American Petroleum Institute v. EPA, 862 F.3d 50 (D.C. Cir. 2017) (vacated parts of 2015 rule and reinstated the 2008 Transfer-Based Exclusion)
- American Petroleum Institute v. EPA, 883 F.3d 918 (D.C. Cir. 2018) (expanded the exclusion to cover spent refinery catalysts)
- Association of Battery Recyclers, Inc. v. EPA, 208 F.3d 1047 (D.C. Cir. 2000) (materials stored for recycling are not necessarily "discarded")
- Shell Oil Co. v. EPA, 950 F.2d 741 (D.C. Cir. 1991) (if material has been discarded it remains subject to Subtitle C even if sent for recovery)
- Safe Food & Fertilizer v. EPA, 350 F.3d 1263 (D.C. Cir. 2003) (firm-to-firm transfers for recycling do not automatically equal "discard")
- Sierra Club v. EPA, 755 F.3d 968 (D.C. Cir. 2014) (standing based on members’ reasonable fear and behavioral changes)
- NRDC v. EPA, 755 F.3d 1010 (D.C. Cir. 2014) (similar standing principles applied to environmental challenges)
- Motor Vehicle Mfrs. Ass’n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29 (U.S. 1983) (standards for arbitrary-and-capricious review)
- Lujan v. Defenders of Wildlife, 504 U.S. 555 (U.S. 1992) (constitutional standing requirements)