US Magnesium, LLC v. United States Environmental Protection Agency
690 F.3d 1157
| 10th Cir. | 2012Background
- US Magnesium petitions for review of the EPA's final SIP Call requiring Utah to revise its SIP implementing the UBR.
- Utah's UBR exempts emissions from 'unavoidable breakdowns' from SIP violations and applies to all regulated pollutants.
- EPA policy statements on malfunction events (Herman, Schaeffer) exist but are nonbinding guidance, not binding rules.
- EPA concluded the Utah SIP is substantially inadequate because the UBR undermines SIP enforceability, improperly limits EPA/citizen enforcement, and misapplies to federal NSPS/NESHAP standards.
- EPA's final rule articulates three core justifications and relies on a rulemaking record; Utah has agreed to revise the UBR.
- US Magnesium challenges standing, the sufficiency of the factual record, and the treatment of policy statements in the SIP Call.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does US Magnesium have standing to challenge the SIP Call? | Magnesium asserts injury due to reliance on UBR shielding it from liability. | EPA contends standing is lacking because relief would be nonredressable absent Utah action. | Magnesium has standing; Bird Declaration shows redressability through Utah's likely response. |
| Is the Administrative Record adequate to support 'substantially inadequate' finding? | EPA failed to show specific facts tying UBR to NAAQS attainment/CAA compliance. | Statute is ambiguous; EPA may rely on a general showing of SIP failure to meet CAA requirements. | Record adequately supports substantial inadequacy under Chevron step two; no strict factual showing required. |
| Did EPA impermissibly rely on nonbinding policy statements to justify the SIP Call? | Herman and related memos were policy statements, not rules, so cannot justify a SIP Call. | EPA treated policies as interpretive guidance, not binding rules; rulemaking followed for the SIP Call. | Not arbitrary or capricious; limited reliance on policy statements consistent with precedent. |
| Is the SIP Call consistent with the EPA's policy statements and regulations regarding breakdowns and NSPS/NESHAPS? | SIP Call misreads Herman/Schäffer memos and misaligns with NSPS/MACT exemptions. | SIP Call applies EPA's interpretation to Utah's UBR in light of policy guidance and case law. | SIP Call not inconsistent; EPA's interpretation aligns with policy and evolves with Sierra Club developments. |
Key Cases Cited
- Arizona Pub. Serv. Co. v. E.P.A., 562 F.3d 1116 (10th Cir. 2009) (deference to EPA policy interpretations when reasonable)
- Northwest Environmental Defense Ctr. v. Bonneville Power Admin., 117 F.3d 1528 (9th Cir. 1997) (standing in agency-review context and supplementation of record)
- AmREP Corp. v. FTC, 768 F.2d 1171 (10th Cir. 1985) (policy statements are non-binding unless adopted in rulemaking)
- Sierra Club v. EPA, 551 F.3d 1019 (D.C. Cir. 2008) (breakdown exemptions and MACT interpretations under Sierra Club)
- United States v. Ford Motor Co., 736 F. Supp. 1539 (W.D. Mo. 1990) (EPA enforcement authority context when interpreting SIP provisions)
- United States v. General Motors Corp., 702 F. Supp. 133 (N.D. Tex. 1988) (EPA could not pursue direct enforcement of SIP limits where state limits exist)
- Fla. Power & Light Co. v. Costle, 650 F.2d 579 (5th Cir. 1981) (enforcement authority considerations under CAA)