Natural Resources Defense Council v. United States Environmental Protection AgencyNatural Resources Defense Council v. United States Environmental Protection Agency
OPINION & ORDER
The United States Environmental Protection Agency (“EPA” or “defendant”) registered an insecticide in violation of its statutory duties to publish notice, invite public comment, and publish its registration decisions. This case presents the question of whether the EPA’s registration should be vacated in light of these defects. It should be.
BACKGROUND
The Natural Resources Defense Council (“NRDC”), a nonprofit environmental advocacy organization, and the Xerces Society (collectively, “plaintiffs”), a nonprofit wildlife conservation organization, challenge the EPA’s registration of the insecticide spirotetramat under the Federal Insecticide, Fungicide, and Rodenticide Act (“FIFRA”),
Intervenor defendant Bayer CropScience (“Bayer”) developed spirotetramat and markets it. Spirotetramat is an insecticide that prevents the synthesis of fats necessary for cell reproduction in insects, which reduces the fertility of female adult insects and the survival of the insect offspring.
FIFRA requires an insecticide containing a new active ingredient to be registered by the EPA in order to be distributed and sold in the United States.
Upon receiving an application, the EPA must publish in the Federal Register a “notice of each application,” and solicit comments for at least thirty days.
The EPA may register a pesticide if it determines,
inter alia,
that the pesticide “will perform its intended function without unreasonable adverse effects on the environment.”
Upon receiving Bayer’s applications, the EPA collaborated with Canadian and Austrian counterpart agencies to analyze spirotetramat. The agencies reviewed hundreds of studies in order to assess the insecticide’s impact on human and animal health, on non-target organisms, and on the environment. Based on its findings, the EPA conditionally approved Bayer’s applications in decisions of June 30, August 8, September 24, and December 16, 2008, which allowed the use of spirotetramat on hundreds of crops.
In the registration process, the EPA identified concerns about the insecticide’s effect on bees. The EPA’s review of tests exposing honeybees to spirotetramat found, inter alia, “increased mortality in adults and pupae, massive perturbation of brood development, early brood development, and decreased larval abundance.” The EPA further found that insecticides that inhibit lipid biosynthesis have “potential for chronic effects on bee broods and development” and “may adversely affect bee broods and development;” and in 2007 the EPA found there is “uncertainty regarding the potential chronic effects of spirotetramat on pollinators because no long-term data were available.” By the time the EPA made its registration decision in June 2008, it had reviewed additional studies on spirotetramat’s chronic effect on bees, but it still found the data lacking because the chronic effect studies tested spirotetramat at levels lower than the label-recommended application rate.
The EPA therefore conditioned its approval of spirotetramat on the completion of studies plugging the data gaps on the chronic effects of spirotetramat on bees.
2
This product is potentially toxic to honey bee larvae through residues in pollen and nectar, but not to adult honey bees. Exposure of adult bees to direct treatment or residues on blooming crops can lead to effects on honey bee larvae. See the “Directions for Use” section of this label for specific crop application instructions that minimize risk to honey bee larvae.
The “directions for use” for specific crops prohibited using spirotetramat on plants during those periods when the plants are flowering and are most likely to attract bees.
Within thirty days of approving an insecticide, the EPA must publicly disclose all information supporting the application,
FIFRA provides procedures for canceling the registration of a pesticide. If the EPA determines that a registered pesticide causes “unreasonable adverse effects on the environment,” the EPA must order a public hearing; or it must consult with the Secretary of Agriculture and then give interested parties notice of its intent to cancel the registration, and those parties may request a public hearing.
The plaintiffs filed their complaint on May 4, 2009, alleging, inter alia, that the EPA failed to publish notice of Bayer’s applications, solicit comments on those applications, and publish notice of its registration decisions. As already noted, on August 6, 2009, the EPA published a notice in the Federal Register announcing its prior registration of spirotetramat and inviting public comments. In response, the EPA received five comments, including one from the NRDC and one from Bayer.
On August 21, the plaintiffs filed an amended complaint claiming the EPA violated FIFRA, and the Administrative Procedure Act (“APA”),
On October 21, the plaintiffs moved for summary judgment on all four of their claims. On November 13, the EPA cross-moved for partial summary judgment on the plaintiffs’ third and fourth claims. Bayer moved to intervene as a defendant on November 17. Following approval of that application, on December 10 it filed a memorandum in opposition to the plaintiffs’ motion for summary judgment and in support of the EPA’s cross-motion for partial summary judgment. These cross-motions for summary judgment became fully submitted on December 18.
DISCUSSION
The parties refer to the plaintiffs’ first two claims as “procedural” and their last two claims as “substantive.” As discussed above, the EPA concedes that it committed the errors the plaintiffs allege in the two procedural claims. The parties agree that these errors require a remand to the agency, but dispute whether the remand should be accompanied by an order vacating the registration of spirotetramat. For the following reasons, the registrations will be vacated. 3
A. Rule of Prejudicial Error
If a court finds that an agency committed an error, the court must take “due account” of “the rule of prejudicial error.”
B. Remanding With or Without Vacatur
In deciding whether the remand should be coupled with a vacatur of registration, decisions rendered by courts applying both FIFRA and the APA will be considered. Since FIFRA does not provide a standard for judicial review, the EPA’s failure to comply with FIFRA is governed by the standards established by the APA,
“[W]hen equity demands, an unlawfully promulgated regulation can be left in place while the agency provides the proper procedural remedy.”
Fertilizer Inst. v. E.P.A.,
In addition, the D.C. Circuit has remanded without vacatur when vacatur would not actually undo the agency action. By the time the D.C. Circuit reviewed the regulatory program at issue in
Sugar Cane Growers,
for example, farmers across the country had already plowed under their crops.
a. Seriousness of the Lack of Notice and Comment
The D.C. Circuit has emphasized the importance of notice and comment to regulatory proceedings. It has said that
notice requirements are designed (1) to ensure that agency regulations are tested via exposure to diverse public comment, (2) to ensure fairness to affected parties, and (3) to give affected parties an opportunity to develop evidence in the record to support their objections to the rule and thereby enhance the quality of judicial review.
The EPA’s failure to provide notice, invite comment, and publish its registration in this case constitutes a serious deficiency. Despite FIFRA’s requirement that the EPA take each of these measures, the EPA utterly failed to comply with these procedural requirements and has offered no explanation whatsoever for these shortcomings.
The EPA claims that it has cured its failure to provide notice and comment. It argues that the plaintiffs have not actually been deprived of their ability to participate in the agency’s decisionmaking process because the EPA solicited comments in response to the August 2009 publication of its registration decisions, and the NRDC has submitted a comment. This argument is unpersuasive. Giving notice and inviting comments
before
an agency takes action “ensure[s] that affected parties have an opportunity to participate in and influence agency decision making at an early stage, when the agency is more likely to give real consideration to alternative ideas.”
New Jersey v. EPA,
The EPA’s simple assurance that the “NRDC’s comments, along with all others received, will be considered by EPA as required by law” is insufficient to demonstrate adequate open-mindedness.
Cf. Id.
(placing burden on agency to overcome presumption of closed mind by “mak[ing] a compelling showing” that it has considered subsequent comments with an open mind). Allowing such an assurance to cure the EPA’s complete disregard for notice, comment, and publication procedures would render FIFRA’s requirements “virtually unenforceable.”
New Jersey v. EPA,
Intervenor defendant Bayer argues that since FIFRA’s notice and comment requirement is more limited than the APA’s notice and comment requirement for rule-making, the lack of notice and comment under FIFRA does not constitute a serious deficiency. Whereas the APA requires an
b. Disruption Caused by Vacatur
The second factor that must be weighed in evaluating whether vacatur is appropriate is the disruption that would be caused by a vacatur.
Comcast,
The EPA suggests that the removal of spirotetramat from the market “may cause growers to use pesticides other than spirotetramat to treat their crops, which EPA has concluded are more harmful to the environment and to human health than spirotetramat.” (Emphasis supplied). If there were reliable evidence in the administrative record that the removal of spirotetramat from the marketplace would be likely to increase harm to the environment, that would weigh heavily against vacatur. The EPA has failed to present sufficiently reliable evidence, however, of such an impact.
To support its assertion of increased harm to the environment from the removal of spirotetramat from the marketplace, the EPA relies solely on its 2007 letter to Bayer concerning Bayer’s “Reduced Risk Request for Spirotetramat.” Bayer’s “Reduced Risk Request” was submitted to the EPA pursuant to the Pesticide Registration Improvement Act (“PRIA”),
has not had an opportunity to review any of the environmental fate and ecological effects/toxicity data beyond this reduced risk screening assessment. This reduced risk screen must therefore rely on the accuracy of the registrant’s (Bayer CropScience) interpretation of these data.... EFED has not conducted an assessment of whether the alternative pesticides pose less ecological risk.
(Emphasis supplied). Upon reviewing Bayer’s data, the EPA noted,
inter alia,
“although the acute toxicity of spirotetramat to bees is categorized as practically non-toxic, there is uncertainty regarding the potential chronic effects of spirotetramat on pollinators because no long-term
Compared to registered alternatives (especially carbamates and organophosphates), spirotetramat appears to have a more favorable risk profile in terms of both human health and the environment. Spirotetramat exhibits lower acute and chronic toxicity than most registered alternatives, and does not show evidence of carcinogenicity or neurotoxicity. Spirotetramat rapidly degrades in the environment and its low use rates will result in a lower chemical load to the environment.
(Emphasis supplied). The February 2007 letter notes that this is “an initial assessment” of spirotetramat’s reduced risk status, and it reserves the opportunity to “reevaluate and possibly revoke” that status upon further review of data. It is on this February 2007 letter that the EPA relies for its assertion that the removal of spirotetramat might cause growers to use pesticides that are more harmful than spirotetramat.
While this correspondence raises important issues, it is insufficient in the context of this record to counsel against vacatur. Since the February 2007 letter contains only an “initial” assessment of spirotetramat’s relative risk profile, is admittedly based solely on Bayer’s own incomplete data, and is subject to revocation based on further data, that 2007 assessment does not sufficiently support a finding that removing spirotetramat from the market will be likely to result in growers using appreciable amounts of pesticides in 2010 that are more harmful to the environment than spirotetramat.
The EPA next argues that vacatur would be disruptive insofar as it would require the EPA to “retread largely the same path” it trod in the registration process “at great expense.” This argument fails. 8 The EPA has not identified what work it would have to duplicate if the registration decisions were vacated. For instance, it has identified no federally-funded research that would have to be redone. Nor has it identified any administrative effort that would be more burdensome than the work it must typically undertake when it complies with FIFRA’s notice and comment regime.
The EPA argues as well that vacatur would “upend the carefully balanced statutory scheme devised by Congress for cancellation of a pesticide.” It will not. For starters, the cancellation process applies to lawfully registered pesticides, and spirotetramat was not lawfully registered. In any event, the complexity and demands of
Finally, the EPA argues that the NRDC’s recent comments in response to the August 2009 Federal Register notice suggest that there is no great harm to the environment from the continued use of spirotetramat during this period of agency review. In those comments, the NRDC advocates stricter crop-specific restrictions and further study of spirotetramat. The NRDC’s advocacy regarding the limitations that it contends should be imposed on any use of spirotetramat does not address the question at stake here: whether withdrawal of spirotetramat from the market pending the EPA’s compliance with the notice, comment, and registration procedures is likely to cause serious disruptions. As a result, even if it is appropriate to consider the NRDC comments, 9 they do not weigh against vacatur.
Bayer adds one additional argument to those presented by the EPA. It argues that it has already invested $90 million on the testing and registration of spirotetramat and stands to lose tens of millions of dollars in sales if the EPA’s registration decisions are vacated. Bayer relies on
MCI Telecomms. Corp v. FCC,
not to vacate the ... rate on the clear understanding that if and when on remand the Commission establishes some different rate of fair compensation for coinless payphone calls, the Commission may order payphone service providers to refund to their customers any excess charges for coinless calls collected pursuant to the current rate.
Id. at 609. MCI is not an example, therefore, of an agency’s complete disregard of the notice, comment, and publication procedures. As significantly, Congress had required the FCC to prescribe regulations setting a fair fee, and thus there was no dispute that customers should be required to pay some fee for their telephone service. Finally, this case does not afford any comparable opportunity to “refund” any damage that might be done to the environment by leaving the agency action in place.
Even assuming that a company’s commercial fortunes can properly be weighed in a vacatur decision,
10
Bayer has not
Plaintiffs are challenging the illegal registration of spirotetramat. The EPA— through its finding that spirotetramat causes “increased mortality in [bee] adults and pupae, massive perturbation of brood development, early brood termination, and decreased larval abundance,” its requirement of additional studies on the chronic effects of spirotetramat on bees, and its warning label requirements — has evinced some concern for the harmful effects spirotetramat may have on bees. Vacating the EPA’s registrations of this potentially harmful insecticide furthers the environmental and agricultural interests FIFRA aims to protect and vindicates FIFRA’s procedural requirements.
CONCLUSION
The Plaintiffs’ October 21, 2009 motion for summary judgment is granted only as to the first two claims in the August 21, 2009 amended complaint. The EPA’s June 30, August 8, September 24, and December 16, 2008 approvals of registrations of spirotetramat are vacated, and the matter is remanded to the RPA for further proceedings in accordance with FIFRA and the APA. The defendant’s November 13, 2009 cross-motion for partial summary judgment is denied as moot. This decision is stayed until January 15, 2010. The Clerk of Court shall close the case.
SO ORDERED.
Notes
. On July 25, 2007, the EPA solicited comments on the maximum spirotetramat residue permitted on food. Food tolerances are regulated by the Federal Food, Drug, and Cosmetic Act.
. The EPA’s risk assessment of spirotetramat found:
Despite that the intrinsic hazard potential to bees based on the acute oral and contact studies with honey bees appears to be low, brood feeding tests with bees and acute toxicity contact studies with other nontarget insects (e.g. parasitoid wasps and predatory mites) conducted at less than the maximum application rate suggest there is potential for mortality in adults and pupae, massive perturbation of brood development, and early brood termination as a result of spirotetramat use. This information, coupled with the fact that two other chemicals representing the ketoenole class of compounds (spiromesifen and spirodiclofen) have also demonstrated the potential for chronic effects on bee broods and development while displaying low acute toxicity, suggests that the mode of action of these compounds (i.e., inhibition of lipid biosynthesis) may adversely affect bee broods and development. Although a study has been submitted for spirotetramat under guideline 850.3040, it was conducted at application rates approximately half of the label-recommended rates and it was not designed in such amanner that adverse effects resulting from treatment could be statistically determined. Therefore, it is recommended that a study design be developed in collaboration with the Environmental Fate and Effects Division [of the EPA],
The EPA’s registration of spirotetramat required completion of this recommended study within two years of registration.
. It is undisputed that the plaintiffs have standing to bring this case.
See Connecticut v. Am. Elec. Power Co.,
. The D.C. Circuit has discussed whether the statutory command to "set aside” unlawful agency action requires vacatur of all agency actions that are flawed in the ways described in
. The Second Circuit has not discussed the standard for determining whether vacatur is appropriate when an agency has failed to provide notice and an opportunity to comment, but it has shown a willingness to look to the law of other circuits — particularly the D.C. Circuit — for guidance on the issue.
See, e.g., Riverkeeper, Inc. v. E.P.A.,
. American Coke,
. As noted above, the EPA's concerns about the quality of data available in chronic effect studies persisted through the time of its June 2008 registration decision.
. The EPA notes that in
Idaho Farm Bureau Fed'n v. Babbitt,
. The parties debate the extent to which a court may rely on evidence outside the administrative record in assessing a remedy. The EPA contends such extra-record evidence is only permitted to show that an agency has rectified a violation after the onset of legal proceedings. If this test were applied here, the EPA's references to the NRDC’s comments in response to the August 2009 notice would be ignored.
. The EPA contends that Congress did not intend "economic considerations to play much of a role” in the EPA’s registration decisions. If that is so, then it may also be true that they should be given limited weight
. Since this Opinion concludes that remand with vacatur is the proper remedy for the EPA’s procedural errors, it is unnecessary to reach the cross-motions for summary judgment on the plaintiffs' allegations of the EPA's substantive errors.