568 F.Supp.3d 1013
N.D. Cal.2021Background
- The EPA promulgated a revised Clean Water Act §401 certification rule (40 C.F.R. Part 121) finalized July 13, 2020 and effective September 11, 2020, narrowing the rule’s scope and changing procedural requirements.
- States, tribes, and environmental groups sued the rule shortly after promulgation; multiple cases were consolidated before Judge William Alsup in the Northern District of California.
- EPA later sought voluntary remand of the rule without vacatur, citing substantial concerns and an intent to revise the rule (and the Biden Administration signaled a review and future replacement rule).
- Plaintiffs asked the court to remand with vacatur; intervenor defendants opposed vacatur and argued disruption and reliance concerns.
- The court evaluated whether remand was warranted and whether to vacate the rule on remand, applying the Allied-Signal equitable vacatur framework and related Ninth Circuit guidance.
- Holding: the court granted EPA’s motion to remand and, exercising equitable discretion, vacated the 2020 §401 certification rule upon remand (returning the prior rule to effect temporarily).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Remand to EPA | EPA’s remand request is frivolous or in bad faith and insufficiently committed to meaningful change | EPA seeks voluntary remand (SKF category: reconsider without confessing error) and has substantial, legitimate concerns | Remand granted; court finds EPA’s concerns substantial and remand not frivolous |
| Vacatur on remand | Rule should be vacated to avoid leaving an allegedly invalid rule in force | Remand without vacatur is appropriate except in limited circumstances; vacatur would be disruptive | Vacatur granted under Allied-Signal: serious deficiencies + limited disruptive consequences support vacatur |
| Standard to apply | Allied-Signal vacatur test applies even absent a merits decision | Allied-Signal inapplicable before merits; court should not vacate without ruling on legality | Allied-Signal is appropriate here; vacatur is equitable and may be granted prior to merits adjudication |
| Scope of §401 certification (cooperative federalism) | Rule unlawfully narrows scope of certification, undercutting state authority per PUD No. 1 | EPA defended its interpretation and criticized PUD No. 1; argued deference may apply | Court finds EPA’s new scope unreasonable and inconsistent with PUD No. 1 and CWA structure; this deficiency strongly supports vacatur |
Key Cases Cited
- Allied-Signal, Inc. v. U.S. Nuclear Regulatory Comm’n, 988 F.2d 146 (D.C. Cir. 1993) (articulates test for whether to vacate agency action when remanding)
- Cal. Cmtys. Against Toxics v. EPA, 688 F.3d 989 (9th Cir. 2012) (cautions remand without vacatur is appropriate only in limited circumstances)
- Pollinator Stewardship Council v. EPA, 806 F.3d 520 (9th Cir. 2015) (applies Allied-Signal factors in vacatur context)
- PUD No. 1 of Jefferson County v. Washington Dep’t of Ecology, 511 U.S. 700 (1994) (states may condition §401 certifications broadly; informs cooperative federalism analysis)
- Chevron U.S.A., Inc. v. Natural Resources Defense Council, 467 U.S. 837 (1984) (agencies receive deference when statute ambiguous and interpretation reasonable)
- Nat’l Cable & Telecomms. Ass’n v. Brand X Internet Servs., 545 U.S. 967 (2005) (addresses agency interpretation and deference doctrines)
- SKF USA Inc. v. United States, 254 F.3d 1022 (Fed. Cir. 2001) (taxonomy of agency positions when seeking remand)
- Encino Motorcars, LLC v. Navarro, 136 S. Ct. 2117 (2016) (agency must offer reasoned explanation for policy changes)
- Amoco Prod. Co. v. Village of Gambell, 480 U.S. 531 (1987) (vacatur is an equitable remedy within court's discretion)