ELR Citation: 50 ELR 20207
No(s). 19-2395-ag (L) and 19-2508-ag (CON) (2d Cir. Aug 31, 2020)

The Second Circuit vacated a final rule published by the National Highway Traffic Safety Administration (NHTSA) that reversed the agency's 2016 civil penalty increase for noncompliance with Corporate Average Fuel Economy (CAFE) standards. States and environmental groups argued NHTSA erroneously concluded that the Federal Civil Penalties Inflation Adjustment Act Improvements Act (Improvements Act) did not apply to the CAFE penalty because it was not a "civil monetary penalty" as that term is defined in the Act, and that the agency improperly reconsidered the merits of the CAFE penalty increase by evaluating its economic effects. The court held that the CAFE penalty was a civil monetary penalty under the Improvements Act and that NHTSA's reconsideration of the economic effects of its initial rule was untimely and thus unauthorized. It therefore vacated the rule.