264 F. Supp. 3d 1040
N.D. Cal.2017Background
- VW installed software defeat devices in ~600,000 “clean diesel” vehicles (2009–2016) that reduced NOx controls during normal driving but activated during testing; EPA/CARB later discovered the scheme.
- DOJ and EPA pursued civil and criminal enforcement; Volkswagen pled guilty to felonies and entered consent decrees, paying billions and funding mitigation and remediation trusts (Wyoming expected to receive funds).
- Wyoming sued VW under two provisions of its EPA‑approved SIP: an anti‑tampering rule and an anti‑concealment rule, alleging a separate violation each day a subject vehicle is driven in the State.
- Volkswagen moved to dismiss, arguing the Clean Air Act—particularly § 209(a)—expressly and impliedly preempts Wyoming’s claims; VW also raised personal‑jurisdiction defenses as to foreign parent entities.
- The Court held it had district‑court jurisdiction to decide VW’s motion (the suit challenged a particular application of the SIP, not the SIP’s validity) but concluded § 209(a) bars Wyoming’s attempt to enforce standards relating to new‑vehicle emissions (including defeat devices) even after vehicles enter commerce.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Section 307(b)(1) (appeals of SIP approval) bars district‑court review | Wyoming: this is an application dispute of an EPA‑approved SIP and is properly in district court | VW: claim effectively challenges EPA’s SIP approval and belongs in court of appeals | District court has jurisdiction — this challenges application/interpretation, not SIP approval itself |
| Whether an EPA‑prohibited defeat device is a “standard relating to the control of emissions from new motor vehicles” under § 209(a) | Wyoming: SIP provisions are federal law and regulate in‑use conduct; not an attempt to adopt new standards | VW: defeat devices are exactly the kind of new‑vehicle design/standard § 209(a) covers; State enforcement would intrude on EPA authority | Court: A prohibition on defeat devices qualifies as a § 209(a) ‘‘standard’’ and is within EPA’s exclusive domain |
| Whether § 209(a) prohibits States from enforcing new‑vehicle standards only before initial sale | Wyoming/Harris County: § 209(a) targets standards "from new motor vehicles" and thus should not bar post‑sale in‑use regulation | VW: § 209(a)’s text and purpose prevent state enforcement of new‑vehicle standards even after sale to avoid duplicative/regulatory patchwork | Court: § 209(a) bars State enforcement of those standards both before and after sale; allowing state suits would undermine EPA’s exclusive enforcement role |
| Whether Wyoming’s tampering/concealment SIP claims are saved by § 209(d) (in‑use regulation) | Wyoming: claims target operation/use in the State and are permitted in‑use regulation | VW: claims effectively require undoing manufacturer design/install decisions and shift compliance burdens to manufacturers | Court: Claims are precluded — although framed as in‑use, they rest on the manufacturer’s installation of defeat devices and thus amount to enforcing new‑vehicle standards prohibited by § 209(a) |
Key Cases Cited
- Engine Mfrs. Ass’n v. EPA, 88 F.3d 1075 (D.C. Cir. 1996) (federal uniformity in motor‑vehicle emissions regulation and dangers of 50‑state patchwork)
- Motor Vehicle Mfrs. Ass’n v. N.Y. State Dep’t of Envtl. Conserv., 17 F.3d 521 (2d Cir. 1994) (California waiver framework and federal/California dichotomy in vehicle regulation)
- Engine Mfrs. Ass’n v. S. Coast Air Quality Mgmt. Dist., 541 U.S. 246 (2004) (interpretation of § 209(a) and examples of ‘‘standards relating to the control of emissions’’)
- Buckman Co. v. Plaintiffs’ Legal Comm., 531 U.S. 341 (2001) (state‑law claims premised on fraud against federal regulator preempted; federal scheme’s exclusive enforcement interest)
- Cal. Dump Truck Owners Ass’n v. Nichols, 784 F.3d 500 (9th Cir. 2015) (EPA‑approved SIPs have the force and effect of federal law; limits on district court challenges to SIP validity)
- Sims v. State of Fla., Dep’t of Highway Safety & Motor Vehicles, 862 F.2d 1449 (11th Cir. 1989) (enforcement of new‑vehicle standards is the exclusive prerogative of the federal government)