SCOTUS 23A349: 5-4 Concurring

Should the Court stay the EPA’s federal emissions reduction rule and are the emissions controls imposed by the rule reasonable regardless of the number of states subject to the rule?

SCOTUS pauses EPA Plan (the Good Neighbor Plan) to keep smog from drifting across state lines

Facts of the Case

Under the Clean Air Act’s “good neighbor” provision, aimed at addressing transboundary ozone pollution that can exacerbate health issues like asthma, bronchitis, and emphysema, the Environmental Protection Agency (EPA) in October 2015 set new air-quality standards for ozone pollution. This provision necessitates that “upwind” states mitigate emissions that could affect air quality in “downwind” states. Following this, states were required to submit plans indicating how they would meet these standards and reduce emissions impacting other states. However, the EPA rejected the plans from 21 states for proposing no changes and additionally addressed two states that had failed to submit plans. In response, it published a federal plan mandating power plants and other industrial facilities in these 23 states to implement existing controls more effectively from 2023 and adopt commonly used controls by 2026, along with requiring controls for other ozone pollution sources like cement kilns and industrial boilers. The plan also utilized an existing emissions trading program among the affected states.

This federal intervention sparked a legal challenge from three states, several companies, and trade associations, requesting a court to temporarily block the EPA rule. They labeled the federal rule a “disaster” that could lead to electric-grid emergencies, an assertion countered by the EPA and its supporters, who deemed such claims speculative. These supporters argued that delaying the rule’s enforcement would critically impede efforts in environmental protection and public health. Consequently, a dozen states initiated a lawsuit against the EPA’s rejection of their emission plans, highlighting the ongoing dispute over federal and state responsibilities in air quality management under the Clean Air Act’s provisions.

Question

Does the Bankruptcy Code authorize a court to approve releases, as part of a plan of reorganization under Chapter 11, that extinguish claims held against non-debtor third parties without the claimants’ consent?

Syllabus

OHIO, ET AL.

23A349 v.

ENVIRONMENTAL PROTECTION AGENCY, ET AL.

KINDER MORGAN, INC., ET AL.

23A350 v.

ENVIRONMENTAL PROTECTION AGENCY, ET AL.

AMERICAN FOREST & PAPER ASSOCIATION, ET AL.

23A351 v.

ENVIRONMENTAL PROTECTION AGENCY, ET AL.

UNITED STATES STEEL CORPORATION

23A384 v.

ENVIRONMENTAL PROTECTION AGENCY, ET AL.

ON APPLICATIONS FOR STAY

No. 23A349. Argued February 21, 2024—Decided June 27, 2024*

Opinion of the Court Delivered by Gorsuch

The applications for a stay in Nos. 23A349, 23A350, 23A351, and 23A384 are granted. Enforcement of EPA’s rule against the applicants shall be stayed pending the disposition of the applicants’ petitions for review in the United States Court of Appeals for the D. C. Circuit and any petition for writ of certiorari, if such writ is timely sought. Should the petition for certiorari be denied, this order will terminate automatically. If the petition is granted, this order shall terminate upon the sending down of the judgment of this Court.

It is so ordered.

Barrett Dissenting with Sotomayor, Kagan, Jackson

The Court, seizing on a barely briefed failure-to-explain theory, grants relief anyway. It enjoins the Good Neighbor Plan’s enforcement against any state or industry applicant pending review in the D. C. Circuit and any petition for certiorari. Ante, at 19. Given the number of companies included and the timelines for review, the Court’s injunction leaves large swaths of upwind States free to keep contributing significantly to their downwind neighbors’ ozone problems for the next several years—even though the temporarily stayed SIP disapprovals may all be upheld and the FIP may yet cover all the original States. The Court justifies this decision based on an alleged procedural error that likely had no impact on the plan. So its theory would require EPA only to confirm what we already know: EPA would have promulgated the same plan even if fewer States were covered. Rather than require this years-long exercise in futility, the equities counsel restraint. Our emergency docket requires us to evaluate quickly the merits of applications without the benefit of full briefing and reasoned lower court opinions. See Does 1–3, 595 U. S., at ___ (opinion of BARRETT, J.). Given those limitations, we should proceed all the more cautiously in cases like this one with voluminous, technical records and thorny legal questions. I respectfully dissent.