Last week a number of small events, mostly in the courts. The Environmental Protection Agency (EPA)’s long awaited CAFÉ regulation finally published in the Federal Register; a suit was filed to invalidate the Securities and Exchange Commission (SEC)’s extractive industries reporting rule, the Department of Justice (DOJ) sought further review of decisions in Food and Drug Administration (FDA) tobacco and EPA cross-state pollution rules, and the Commodity Futures Trading Commission (CFTC) reportedly is considering further steps to try to save its recently invalidated position limits rule. Just the facts.
The EPA published the 2017 and Later Model Year Light-Duty Vehicle Greenhouse Gas Emissions and Corporate Average Fuel Economy Standards (aka CAFÉ) in today’s Federal Register. Previous discussion of this rule questioned the ability to project costs and benefits as far downstream as EPA projects, and now the clock has started on judicial review.
The American Petroleum Institute and others sued the SEC in the United States District Court for the District of Columbia to invalidate the Disclosure of Payments by Resource Extraction Issuers final rule, previously approved and published. The rule requires publicly traded energy and mining companies to file commercially sensitive and detailed payment information about foreign energy investments with the SEC in a public database. The Complaint alleges the rule violates the First Amendment to the United States Constitution by forcing U.S. companies to engage in content-based speech that discloses sensitive, confidential information that the SEC concedes will cause them substantial economic harm. Under the Administrative Procedure Act (APA), the complaint alleges, among other things that the SEC acted, or the rule is, arbitrary and capricious because it:
- Misread the statute to require public disclosure of a company’s reports;
- Failed to provide a reasoned explanation for why particular exemptions proposed by commenters were or were not in the public interest, such as the proposed exemption for payments whose disclosure would violate the law of a foreign state;
- Failed to adequately consider whether its discretionary decisions in the rulemaking – including the decisions to refuse to allow confidential reporting, to define “project,” and to grant an exemption for conflicts with foreign law – resulted in burdens on competition that were “necessary or appropriate” as required under the Exchange Act;
- Failed to set forth substantial evidence evaluating the costs and benefits of the rule as required under the Exchange Act; and
- Failed to provide public notice and an opportunity for comment on a new methodology and cost assessment used for the first time in the final rule.
The complaint and the parallel petition for review (because jurisdiction is not free of doubt) are courtesy of the United States Chamber of Commerce National Chamber Litigation Center.
Ricardo Carvajal, of Hyman, Phelps & McNamara, points out that the Department of Justice, for the FDA, requested rehearing and rehearing en banc in R.J. Reynolds v. FDA by the United States Court of Appeals for the District of Columbia Circuit.
Katherine McCoy, of Liskow & Lewis, reports that DOJ, for the EPA, has sought a rehearing en banc, not a panel rehearing with a suggestion of rehearing en banc, of the decision of the United States Court of Appeals for the District of Columbia Circuit invalidating the Cross-State Air Pollution Rule in EME Homer City Generating v. EPA.
♦There is a distinction between the FDA and EPA petitions for review, but it may not make a difference: the FDA petition admits that panel rehearing may be appropriate, while the EPA petition appears to request only review by the full court of appeals. Both panel decisions were 2-1, but rehearing is not very likely and “disfavored.”
♦This blog happily extends the courtesy to those who make court documents publicly available without the payment of PACER fees (preferably with filing headers).
Ben Protess, at Dealb%k, reports that the CFTC is considering appealing the district court decision in International Swaps and Derivatives Association v. CFTC invalidating the Position Limits for Futures and Swaps final rule and interim final rule.
♦Given the previous votes, dissents, and discussion in the CFTC, as explicated by the District Court, a majority of commissioners may not agree to a staff-recommended appeal – the District Court may have responded directly to the concerns raised within the CFTC that it did was still required to make a finding of necessity. Stand by.