ELR Citation: ELR 20080
No(s). 93-2276 (1st Cir. Aug 3, 1994)

The court affirms a district court order denying automobile trade groups' request for a preliminary injunction barring the Massachusetts Department of Environmental Protection (DEP) from implementing new motor vehicle tailpipe emission regulations. On January 31, 1992, the DEP adopted California's low emission vehicles program. The trade groups claimed that implementation of the DEP's regulations for model year 1995 vehicles would violatethe requirement of Clean Air Act §177 that states adopting California emission standards for a model year must do so at least two years before the beginning of that year. They claimed that the leadtime requirement applies industrywide and that because certain manufacturers had produced model year 1995 vehicles less than two years after the DEP issued its regulations, model year 1995 had begun less than two years after the adoption of those regulations.

The court first grants the trade groups' motion under Fed. R. App. P. 42(b) to dismiss their appeal of their identicality, waiver, and third-vehicle claims. The court has broad discretion to grant voluntary motions to dismiss and none of the grounds that have compelled courts to deny voluntary motions to dismiss are present here. The court notes that granting the motion will not shelter the remaining claims from scrutiny, because the court will simply be accepting the trade groups' decision to let those claims be finally adjudicated before appeal. Also, the interests of fairness and judicial economy are well-served by restricting the court's review to the leadtime issue, which is the sole claim the parties concede the court must decide. Turning to the trade groups' leadtime claim, the court declines to follow the Second Circuit's decision in Motor Vehicle Manufacturers Ass'n v. New York Department of Environmental Conservation, 24 ELR 20552 (2d Cir. 1994), that the leadtime requirement applies industrywide. New York, like California, but unlike Massachusetts, imposed fleet average requirements to determine the mix of vehicles sold in the state each year. The Second Circuit determined that the leadtime provision was best read with an industrywide commencement date because splitting the year would unduly complicate the fleet averaging plan. The court also rejects the Second Circuit's characterization of the U.S. Environmental Protection Agency's (EPA's) interpretation of the term "model year" as "newly minted" for litigation. EPA interpreted the term as applying to vehicles within the same "engine family." It issued that interpretation in 1987 and cited it in a 1991 letter to a member of Congress. The court holds that EPA's interpretation, although predating §177, satisfies the statute's requirement that the Agency promulgate a regulation defining "model year." The court rejects the Second Circuit's finding that Congress could not have contemplated that the leadtime provision might apply on an engine-family basis, because Congress expressly authorized EPA to define when the model year commences. The court holds that the trade groups waived, for purposes of the appeal, the argument that the court owes EPA's interpretation no deference because the statute requires EPA to define "model year" in a regulation, not a policy statement. The trade groups failed to make the argument to the district court and compounded that error by omitting the point from their opening brief. Also, the argument does not qualify for an exception to the raise-or-waive rule, because it is not so compelling as to assure the trade groups' success. And the trade groups may raise the argument in the district court before issues pertaining to the 1995 requirements become moot.

The court next holds that EPA's interpretation of the term "model year" is not arbitrary or illegal. The court finds the statutory language ambiguous with respect to whether the leadtime requirement might apply on an industrywide or engine-family specific basis, and the legislative history is unenlightening. The court finds no inherent conflict between EPA's interpretation and Congress' intent, because EPA's interpretation grants every manufacturer two years to develop emissions controls and to devise marketing and distribution strategies for any new vehicle or engine family subject to California-type standards. The court holds that based on the assumption that EPA's interpretation provides a regulatory definition of "model year" for purposes of §177, the leadtime requirement was satisfied. The court, therefore, holds that the district court did not abuse its discretion in refusing to enjoin the 1995 standards, because the trade groups failed to establish a likelihood of success on the merits. Finally, the court awards the DEP costs but rejects its request for attorney fees. Fees may be awarded if an appellant has filed a frivolous appeal or acted in bad faith, but the court finds no evidence of such conduct.

Counsel for Plaintiffs
Daniel F. Attridge, Stuart A. C. Drake
Kirkland & Ellis
655 15th St. NW, Ste. 1200, Washington DC 20005
(202) 879-5000

Counsel for Defendants
David G. Bookbinder, Ass't Attorney General
Attorney General's Office
One Ashburton Pl., Boston MA 02108
(617) 727-2200

Before SELYA, Circuit Judge, BOWNES, Senior Circuit Judge, and CYR, Circuit Judge.