AMERICAN PETROLEUM INSTITUTE, PETITIONER v. ENVIRONMENTAL PROTECTION AGENCY, RESPONDENT AMERICAN CHEMISTRY COUNCIL, ET AL., INTERVENORS
No. 09-1038
United States Court of Appeals FOR THE DISTRICT OF COLUMBIA CIRCUIT
FILED: March 6, 2018
Consolidated with 15-1083, 15-1085, 15-1088, 15-1089, 15-1094
On Petitions for Panel Rehearing
Before: TATEL and KAVANAUGH, Circuit Judges, and WILLIAMS, Senior Circuit Judge.
PER CURIAM: In 2015, the Environmental Protection Agency promulgated a final rule that defined when certain hazardous materials were deemed discarded—as opposed to
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Our 2017 opinion provides the relevant statutory and regulatory background. Id. at 55–57. We offer here only what is necessary to make sense of our three modifications to that decision.
In 2008, pursuant to the Resource Conservation and Recovery Act (“RCRA“),
In 2015, while challenges to the 2008 rule were pending in this court after having been held in abeyance in light of EPA‘s issuance of a notice of proposed rulemaking on the same subject, the agency issued revisions to the rule. Definition of Solid Waste, 80 Fed. Reg. 1,694 (Jan. 13, 2015). Four of those changes are pertinent to the petitions for rehearing. First, EPA changed the content and application of the four legitimacy factors. Id. at 1,719/3–20/1. Second, EPA redefined and made more stringent the “containment” standard, a preexisting requirement recyclers had to satisfy to qualify for the Generator-Controlled and Transfer-Based Exclusions. Id. at 1,704/1–3, 1,738/1. Third, EPA allowed spent petroleum refinery catalysts to qualify for these solid waste exclusions. Id. at 1,737/3–38/1. Fourth, EPA replaced the Transfer-Based Exclusion with the Verified Recycler Exclusion. Id. at 1,695/2.
Our 2017 decision vacated the Verified Recycler Exclusion and reinstated the Transfer-Based Exclusion. API, 862 F.3d at 75. We explained that, as a result, spent catalysts would once again be disqualified from that exclusion‘s ambit “subject . . . to such arguments as parties may raise supporting a different outcome.” Id. We also vacated the revised Factor 4 “insofar as it applies to all hazardous secondary materials via
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We conclude that three aspects of the petitions for rehearing warrant revision of our 2017 decision.
[U]nder the contained standard for both the generator-controlled exclusion and the verified recycler exclusion, any hazardous secondary material that poses a risk of fire or explosion must have that risk addressed in order to ensure that the material is legitimately recycled and not discarded.
Comments Document at 266. We then explained that we accordingly harbored doubts that EPA would have altered its treatment of spent catalysts absent the Verified Recycler Exclusion. API, 862 F.3d at 72. Review of the petitions for rehearing and the Comments Document dissipates such doubts.
The commenters in the rulemaking were split on spent catalysts, but among those arguing for relaxation of the ban was one asserting that, as a factual matter, catalysts simply are not as dangerous as EPA thought: “The commenter stated that in the experience of their members, the catalysts sometimes have self-heating properties, but rarely are pyrophoric or otherwise exhibit the RCRA characteristic of ignitability.” Comments Document at 263.
EPA did not agree:
However, EPA does not support commenters’ claim that spent petroleum catalysts are ‘rarely’ pyrophoric as a
reason for the exclusion; under the contained standard for both the generator-controlled exclusion and the verified recycler exclusion, any hazardous secondary material that poses a risk of fire or explosion must have that risk addressed in order to ensure that the material is legitimately recycled and not discarded.
Id. at 266. The clause following the semi-colon in that marathon sentence is, of course, the language quoted above that originally gave us pause.
But EPA agreed with those commenters who thought a unitary regulatory scheme should govern spent catalysts and that “spent petroleum catalysts sent for recycling should be eligible” for the Generator-Controlled and Verified Recycler Exclusions. Id. at 265. As justification, EPA pointed to the fact that the “proposed contained standard” sufficiently “addresses the risk of fires and explosions” and therefore “the pyrophoric properties of the spent petroleum catalysts.” Id. at 266. One additional virtue of EPA‘s approach, it said, was that the containment standard gets at the risk of fire for any hazardous secondary material instead of singling out catalysts for unique treatment. Id.; see also id. at 268 (“EPA is finalizing, as proposed, a contained standard that ‘addresses any potential risks of fires and explosions.’ This performance-based standard addresses the potential for discard of all hazardous secondary materials, including spent petroleum catalysts, via fires and explosions.“).
Accordingly, EPA did not believe that it was “necessary to promulgate a separate exclusion” for catalysts or that “additional conditions” were needed to ensure proper treatment of catalysts. Id. EPA defended its approach as one that “avoids the potential dual system of regulation” that would result from a catalyst-specific rule. Id.
Because we held that the revised containment standard survives our vacating other aspects of the Verified Recycler Exclusion, API, 862 F.3d at 72 (explaining that the “expanded containment requirement” does “not depend on any vacated portions of the Verified Recycler Exclusion“); see also id. at 75 (excepting the “expanded containment requirement” from vacatur of the Verified Recycler Exclusion), it will continue to apply to the Generator-Controlled Exclusion and the now-revived Transfer-Based Exclusion (as well as in Factor 3, where applicable).
EPA informs us that it has no objections to API‘s request, explaining that the provisions that survived the demise of the Verified Recycler Exclusion—the additional emergency preparedness requirement and the more muscular “contained” definition—independently resolve what had previously been the reason for separate catalyst treatment. See EPA‘s Resp. to Pets. Panel Reh‘g at 12–13. As EPA‘s current position is fully supported by the rulemaking record, we are confident that it reflects EPA‘s view at the time of the rulemaking. See Verizon v. FCC, 740 F.3d 623, 659 (D.C. Cir. 2014); cf. Davis Cnty. Solid Waste Mgmt. v. EPA, 108 F.3d 1454, 1457–59 (D.C. Cir. 1997) (accepting EPA‘s position on rehearing even in the face of its contrary position at oral argument).
Environmental Petitioners claim that our 2017 decision left intact the containment requirement as applied to generators, but not to third-party recyclers. On this premise they argue that because of this supposed gap, EPA would not have undone the bar on eligibility for spent catalysts. See Envtl. Pet‘rs’ Opp‘n to Panel Reh‘g 2–3 (comparing
But the Environmental Petitioners’ premise is mistaken. The revised containment standard is found in two places in the Verified Recycler Exclusion, one specifying the obligations of generators,
We severed and affirmed the former (the revised containment standard as it applied to generators), see API, 862 F.3d at 72, but said nothing of the latter (the containment requirement applied to third-party recyclers). Accordingly, that
It is, of course, true that the provision in subsection (a)(24)(v) (applying to generators) expressly refers to
Accordingly, we sever and affirm EPA‘s decision in the 2015 rule to eliminate the provision in the 2008 rule that had barred spent catalysts from qualifying for the Transfer-Based Exclusion.
Scope of Factor 4 Vacatur. In our 2017 decision, we wrote that because Factor 4‘s “comparable to or lower than” standard “is not reasonably focused on items that are ‘part of the waste disposal problem,‘” “the exception process must be adequate to offset that fault.” API, 862 F.3d at 63. Finding that the exception process imposed “draconian” procedures on recyclers, id. at 61, we found the exception inadequate and vacated Factor 4 “insofar as it applies to all hazardous secondary materials via
Industry Petitioners dispute that view, asserting that they challenged Factor 4 in its entirety. Upon revisiting their earlier briefing, we now agree, as does EPA. See EPA‘s Resp. to Pets. Panel Reh‘g at 6. If anything, Industry Petitioners’ attack on the legitimacy factors was broader—not narrower—than what we entertained. See, e.g., Industry Pet’rs’ Br. at 20–25 (arguing that Factor 4 impermissibly reaches materials that are not discarded); id. at 65 (requesting that we vacate the legitimacy factors). We also find that nothing about the reasons we gave for vacating Factor 4 would not equally apply in situations where it is expressly incorporated into an exclusion (e.g., the Generator-Based Exclusion,
Factor 4 is therefore vacated in its entirety.
Effect of Factor 4 Vacatur. At EPA‘s request, EPA‘s Resp. to Pets. Panel Reh‘g at 6–10, we clarify the effect of our vacating Factor 4. (We note that a subset of the Industry Petitioners appear to assume results different from our clarification. Freeport-McMoRan Inc. & Am. Chemistry Council Pet. Panel Reh‘g at 10.)
In 2015, a few changes were made to the four legitimacy factors: (1) all four factors were made to apply to all excluded recycling including recycling invoking exclusions that predated the 2008 rule (in the 2008 rule, the legitimacy factors applied only to the then-new Generator-Controlled and Transfer-Based Exclusions), see 80 Fed. Reg. at 1,720/2–22/3; (2) Factors 3 and 4 became mandatory factors (in the 2008 rule, they were merely factors to be “considered“), see id. at 1,722/3–23/2; and (3) the substance of Factors 3 and 4 changed somewhat, see id. at 1,724/3–32/1.
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In sum, we grant the petitions for panel rehearing in three respects: (1) we sever and affirm EPA‘s decision to remove the spent catalyst disqualifier; (2) we vacate the 2015 rule‘s version of Factor 4 in its entirety; and (3) we clarify the effect of that vacatur. The petitions for rehearing are denied in all other respects.