585 F.Supp.3d 840
W.D. La.2022Background
- Eleven states sued after President Biden’s Executive Order 13990 reinstated an Interagency Working Group (IWG) to publish interim social-cost estimates for carbon, methane, and nitrous oxide (SC‑GHG), directing agencies to “shall use” those values and to account for global damages.
- The February 2021 interim estimates mirror the Obama-era 2016 estimates (adjusted for inflation) and depart from OMB Circular A‑4 by favoring global impacts and eschewing Circular A‑4’s standard 3% and 7% discount‑rate guidance and domestic focus.
- States argued the IWG estimates are legislative, were adopted without APA notice‑and‑comment, are arbitrary and capricious, exceed executive authority (major questions/Youngstown concerns), and conflict with statutes that contemplate domestic‑focused analysis.
- The government and several agencies already used the interim estimates in rulemakings and NEPA analyses (EPA, DOE, BLM, NHTSA, FAR, CEQ), which the states say caused imminent harms to state revenues and regulatory burdens in cooperative‑federalism programs.
- The court addressed standing, reviewability (final agency action), APA and statutory claims, and preliminary‑injunction factors; it found the states had standing, a strong likelihood of success on the merits, and granted the preliminary injunction in full on February 11, 2022.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing (Article III) | States suffer imminent, concrete sovereign, fiscal and parens patriae injuries from mandated use of SC‑GHG in cooperative‑federalism programs and NEPA; special solicitude applies. | Harms are speculative; agencies’ use is contingent and not necessarily traceable to EO/IWG. | States have standing (injury‑in‑fact, traceability, redressability); special solicitude applies. |
| Final agency action / reviewability | The IWG interim estimates are binding directives that consummate agency decisionmaking and thus are reviewable under the APA. | The estimates are merely interim/precatory and not final until used in particular rulemakings. | The interim estimates qualify as final agency action for APA review. |
| APA procedural and substantive review (notice‑and‑comment; arbitrary & capricious) | SC‑GHG are legislative, numeric binding norms that required notice‑and‑comment; methodology departs from prior policy (discount rates, domestic focus) without reasoned explanation. | The IWG/EO are internal policy guidance; agencies retain discretion and can choose methods in future rulemakings. | Court finds likely success: EO/IWG violated APA notice‑and‑comment and the estimates are arbitrary/capricious. |
| Authority / Major questions / consideration of global effects | EO/IWG exceed executive authority by imposing transformative rules and requiring consideration of global effects contrary to statutes that focus on domestic interests. | President may direct executive branch policy and supervise agencies; EO does not strip statutory agency authority and must be implemented consistent with law. | Court holds EO/IWG exceed authority under major‑questions principles by mandating global‑focused SC‑GHG use and thus likely unlawful. |
Key Cases Cited
- Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992) (Article III standing requirements)
- Massachusetts v. EPA, 549 U.S. 497 (2007) (state standing and special solicitude)
- Bennett v. Spear, 520 U.S. 154 (1997) (final agency action test)
- Utility Air Regulatory Group v. EPA, 573 U.S. 302 (2014) (major questions doctrine / limits on agency power)
- Free Enterprise Fund v. Public Co. Accounting Oversight Bd., 561 U.S. 477 (2010) (APA as a limit on executive growth)
- Spokeo, Inc. v. Robins, 578 U.S. 330 (2016) (concreteness requirement for injury)
- Winter v. Natural Resources Defense Council, Inc., 555 U.S. 7 (2008) (preliminary injunction standards)
- Perez v. Mortgage Bankers Ass'n, 575 U.S. 92 (2015) (rulemaking procedural equivalence)
- Youngstown Sheet & Tube Co. v. Sawyer, 343 U.S. 579 (1952) (limits on executive power)
- Texas v. United States, 809 F.3d 134 (5th Cir. 2015) (state standing and federalism considerations)