Legal & Regulatory

Court Orders EPA to Evaluate Coal Industry Job Losses Related to Air Pollution Rules

A federal court has ordered the Environmental Protection Agency (EPA) to file a plan and schedule to evaluate the consequences of its air pollution rules on jobs, finding for a giant coal company that is suing the agency for an alleged “war on coal” waged over the past five years.

In an October 17 summary judgment, U.S. District Judge John Preston Bailey for the U.S. District Court for the Northern District of West Virginia ordered the agency to file the plan and schedule within 14 days.

The EPA must fully comply with a provision in the Clean Air Act (Section 321[a]) adopted by Congress in 1977 that requires the agency to continually evaluate job losses, which may stem from air pollution rules, said Bailey. Moreover, if the EPA refused to conduct the required evaluation, it would constitute an “abuse of discretion,” owing to the importance, widespread effects, and the claims of the coal industry, he said.

Irreparable Harm

The case stems from a lawsuit filed in March 2011 by troubled coal giant Murray Energy Corp. and its 11 subsidiaries that seeks relief for the EPA’s alleged failure to evaluate job losses and plant closures while it promulgated rules, as required by the Clean Air Act (under 42 U.S.C [section] 7621).

The section requires the EPA to “conduct continuing evaluations of potential loss or shifts of employment which may result from the administration or enforcement of the provision of [the Clean Air Act] and applicable implementation plans, including where appropriate, investigating threatened plant closures or reductions in employment allegedly resulting from such administration or enforcement.”

Murray Energy argued that the EPA’s enforcement of the Clean Air Act and “refusal” to factor in its impact is “irreparably harming the plaintiffs.” The mining company that employs about 7,200 workers warned in a notice sent to workers this July that it could lay off up to 80% of its workforce owing to weak coal markets.

The company’s case is backed by amicus curiae briefs from West Virginia and 12 other states, as well as from the U.S. Chamber of Commerce and the National Mining Association. One expert report filed with the court by John Deskins, a West Virginia University associate professor who prepares annual economic outlooks for West Virginia, suggested that between 2008 and 2015, the nation saw a 24% reduction in coal production, with a “sharp acceleration in coal losses in 2015 coming “as a direct result of the regulatory policy change” reflected in one of the EPA’s core utility strategy rules.

EPA: Rules Alone Not Responsible for Coal Job Losses

The EPA sought dismissal of the suit on the grounds that the provision of the Clean Air Act is discretionary, arguing that it contains no “date-certain deadline.”

But the court disagreed, noting that “In fact, the provision does contain a date certain for the mandatory duty: the required timing is ‘continuing.'” The statutory mandate that the EPA “is an express, unambiguous requirement on the agency of a continuing nature,” Bailey stressed. “Black’s Law Dictionary (8th Ed.) defines ‘continuing’ as ‘uninterrupted.'”

The EPA also argued that the plaintiffs lacked standing, refuting Murray Energy’s argument that agency rules had caused a “reduced market for coal,” which in turn threatened the economic viability of the company. In fact, EPA said, Murray Energy Corp. is larger today that it was in 2009, so it cannot be injured by the reduced market.

But to that claim, Bailey issued a harsh rebuke: “[EPA] does not need to kill a company to injure it,” he said.

The agency also said that its alleged failure to conduct employment evaluations couldn’t be pegged on the reduced market for coal, asserting that the market for coal is global, and therefore cannot contribute to a concrete and particularized injury. And it noted, with some irony, that “a reduced market for coal cannot be redressed by a favorable decision by this Court.”

But Bailey disagreed, saying that a large marketplace is not a barrier to standing.

“This Court finds these allegations sufficient to show that the injuries claimed by the plaintiffs are fairly traceable to the actions of the EPA. While the EPA argues that such would only be traceable to the earlier actions of the EPA rather than the failure of the EPA to conduct employment evaluations, this Court cannot agree. The claimed injuries, while in part traceable to the prior actions of the EPA, may also be fairly traceable to the failure of the EPA to conduct the evaluations.”

Significantly, he added that the company’s injuries are redressable: “If this Court were to grant the requested injunctive relief to require the EPA to perform its duty under 18 U.S.C. [section] 7621, the results of the inquiry may have the effect of convincing the EPA, Congress, and/or the American public to relax or alter the EPA’s prior decisions.”

One explicit purpose of the provision, Bailey said, “is to protect industries, employers and employees from the untoward effects of prior EPA actions.”

The case is Murray Energy Corp. et al. v. McCarthy (5:14-cv-00039).


Sonal Patel, associate editor (@POWERmagazine, @sonalcpatel)


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