Facts of the Case
In 2012, California applied for a waiver from the Environmental Protection Agency (EPA) to implement its Advanced Clean Car Program, which included two key components: a Low Emission Vehicle Program to reduce carbon dioxide emissions by 34% for new cars in Model Years 2017-2025, and a Zero Emission Vehicle Program requiring about 15% of manufacturers’ fleets to be electric cars by 2025. The EPA granted this waiver in 2013, and automobile manufacturers began investing to meet these requirements.
However, in 2019, under a different administration, the EPA withdrew the 2013 waiver, arguing that state greenhouse gas regulations were preempted by federal fuel economy standards, that California’s standards weren’t necessary to meet “compelling and extraordinary conditions,” and that California could not show a direct connection between greenhouse gas emissions and its air pollution problems. After this withdrawal, several automakers like Honda, Ford, and BMW voluntarily agreed to continue meeting California’s standards due to their existing investments and growing consumer demand for electric vehicles. In 2022, under yet another administration, the EPA reversed course again and reinstated the 2013 waiver, prompting challenges from various states and fuel industry groups who argued that California should not receive special treatment and that climate change is not a “compelling and extraordinary condition” justifying state-specific standards. California, environmental organizations, and automobile manufacturers intervened to defend the EPA’s decision.
The D.C. Circuit dismissed most of the claims for lack of standing, finding that challengers had not shown that their injuries were redressable by a favorable decision.
Questions
May a party establish the redressability component of Article III standing by pointing to the coercive and predictable effects of regulation on third parties?
Conclusions
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Fuel producers have Article III standing to challenge EPA’s approval of California regulations that require automakers to manufacture more electric vehicles and fewer gasoline-powered vehicles because invalidating the regulations would likely redress their monetary injuries from decreased fuel sales. Justice Brett Kavanaugh authored the 7-2 majority opinion of the Court.
The California regulations force automakers to limit average greenhouse-gas emissions across their vehicle fleets and manufacture a certain percentage of electric vehicles, thereby reducing demand for gasoline and other liquid fuels. Article III standing requires showing injury in fact, causation, and redressability—meaning the plaintiff must demonstrate actual harm caused by the defendant that judicial relief would likely fix. When government regulation of one business predictably causes downstream economic injuries to linked businesses, commonsense economic principles support finding that invalidating the regulation would likely redress those injuries by removing the regulatory impediment to the injured party’s sales.
Record evidence confirms that invalidating the regulations would likely redress the fuel producers’ injuries, including: California’s own estimates showing the regulations would cause substantial reductions in gasoline demand exceeding $10 billion by 2030; California’s statements that the regulations are “critical” for emissions reductions and that without them fewer electric vehicles would be sold; EPA's affirmation that California “needs” these standards; and five automakers’ intervention predicting that absent the regulations, competitors would sell fewer electric vehicles to gain market advantage. The Court rejected arguments that fuel producers needed expert affidavits or declarations from automakers to establish redressability, explaining that requiring such evidence would improperly make standing depend on alignment between plaintiffs and regulated third parties.
Justice Sonia Sotomayor authored a dissenting opinion arguing that the Court should have vacated and remanded for the D.C. Circuit to reconsider based on corrected facts about when the regulations expire.
Justice Ketanji Brown Jackson authored a dissenting opinion arguing the Court applies standing doctrine inconsistently by accepting commonsense inferences for business plaintiffs while demanding more evidence from civil rights plaintiffs.