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Federal Regulations Advisor Insight and Commentary on U.S. Government Regulatory Affairs

Tuesday Morning Regulatory Review – 5/26/15: Tailoring Snakes; COOL Trade; Spring 2015 Unified Agenda; & Approaching WOTUS Storm

Posted in Agency Authority, Executive - OMB Review, Judicial Review & Remedies

iwo jima at dawn govWelcome back from the Memorial Day holiday with a slightly delayed review of last week’s highlights in regulatory practice. As expected, the United States District Court for the District of Columbia entered a tailored preliminary injunction of the Department of the Interior (DOI)’s regulation of interstate transfers of certain harmful snakes. The World Trade Organization may have set in motion further Country of Original Labeling (COOL) regulatory efforts by finding that the regulations violated United States trade obligations. The Office of Management and Budget (OMB) released the Administration’s current regulatory planning – the 2015 Spring Unified Agenda. One rule that may meet its planned release could be the controversial Environmental Protection Agency (EPA) definition of “Waters of the United States.”

Tailoring Snakes: Following up on last week’s preliminary preliminary injunction, in United States Association of Reptile Keepers v. Jewell, the district court entered a tailored preliminary injunction against enforcement of the DOI Injurious Wildlife Species; Listing Three Python Species and One Anaconda Species as Injurious Reptiles. The district court held that plaintiffs were likely to succeed on the issue of whether DOI possessed statutory authority to regulate interstate, intracontinental transfer of dangerous snakes, other than enumerated jurisdictions. The court tracked the specific language of the Lacey Act for DOI’s jurisdiction as a threshold, and specifically exempted from its preliminary injunction the application of the rule to Florida and Texas, the only jurisdictions with a climate sufficient for the reticulated python and green anaconda to survive in the wild – and thus propagate – if accidentally or otherwise released. The court found that plaintiffs had not shown irreparable harm in those jurisdictions and the balance of interests (harms) favored DOI in those limited instances.

► As noted previously, the rule and the litigation are rather unique and do not impact a significant element of the economy, but the court’s decisions are carefully crafted and responsive to the precise statutory language and the complex preliminary and final remedies available under the Administrative Procedure Act (APA). The opinions provide examples of the detailed analysis that is required to litigate, manage, and resolve APA regulatory cases.

COOL Trade: DOA’s 2013 COOL regulations require that meat labels indicate the country (or countries) where the animal was born, raised, and slaughtered. The United States Court of Appeals for the District of Columbia Circuit, en banc, previously upheld the COOL regulations promulgated by the Department of Agriculture (DOA) against challenges by domestic producers. Mexico and Canada, however, challenged the same regulations before the World Trade Organization (WTO) (for the second time, challenging a second round of regulations, based on a second statute), arguing that the regulations violated United States trade obligations. In essence, WTO’s Appellate Body found that the COOL regulation violates the United States trade obligations by imposing a disproportionate burden in record-keeping and verification requirements on Canadian and Mexican meat producers and processors. WTO now begins a process to determine what level of tariffs Canada and Mexico can impose on the United States. The United States could avoid sanctions by revising or repealing the COOL regulations.

► International trade obligations and WTO’s authority to adjudicate trade disputes are based on treaties to which the United States is a party – a legal equivalent to laws passed by Congress. Here, the WTO decision reflects the potential for conflict between those two sources of law and, in this case, is based on impact on foreign parties. To avoid the consequences of WTO authorized retaliatory tariffs, DOA may now undertake further regulations – and both DOA and the United States Trade Representative will need to consider (or reconsider) a range of options. The process may be never-ending.

Spring 2015 Unified Agenda: OMB released the Spring 2015 Unified Agenda of Regulatory and Deregulatory Actions a day before the beginning of the long Memorial Day weekend. This release is not the first time that OMB has released the Unified Agenda in a pre-holiday news lull – leading some news outlets to label the release timing cynically, such as “notorious.” Numerous news outlets and advocates have responded, nonetheless, with pontifications that specific proposed rules and final rules will be published by a certain month or have been delayed until a certain month – to their relief or angst.

► The “planned” timing of proposed and final rules deserves a careful review for precisely what the agenda represents – an agenda, a planning document. At the same time, great care should be taken to not read more into the Unified Agenda than is intended – it is not a “deadline,” self-imposed or otherwise, for a specific action and it is subject to change as priorities shift and intervening events propel listed or other actions. OMB, the agencies, and the public could benefit (and avoid some criticism) by releasing the Unified Agenda on a schedule that is not tied to a holiday.

Approaching WOTUS Storm: The Unified Agenda does note that the EPA plans to release its contentious Clean Water Rule: Definition of “Waters of the United States” (WOTUS) final rule this month – i.e. this week. The Unified Agenda entry does warrant some attention because OMB reviewed and approved it and OMB does not normally cut off its options and normally does reserve the 90-day review period under Executive Order 12866 (which is also not a deadline). As a most general matter, that which is defined to be a “water of the United States” is subject to Clean Water Act (CWA) permitting for any possible pollution. Since proposed a year ago, EPA received over 1.1 million comments, and OMB in recent weeks has held at least 20 meetings to listen to interested parties’ views on the not-economically significant final rule that they have not seen.

► WOTUS could be released this week – it is quite possible. The real issue is whether the rule will (a) clearly define which tributaries and wetlands are subject to permitting or (b) continue the misnomer of definition while adopting a regulation that includes a large residual application adjudication process for EPA to determine what is and what is not a “water of the United States” for CWA purposes. Whether the rule is clear or just adjudicatory, expect it to be challenged in court. Stand by for approaching WOTUS.