Pruitt Should Reconsider Obama-Era Settlement with Harley-Davidson That Funnels Millions to an Unrelated, Politically-Favored Project

Washington, D.C. – Cause of Action Institute (CoA Institute) today sent a letter to EPA Administrator Scott Pruitt urging him to reconsider an Obama-era settlement reached with Harley-Davidson, Inc. for selling after-market “super tuner” devices to boost performance of their motorcycles. The EPA alleged these devices were sold in violation of the Clean Air Act. Without admitting liability, Harley-Davidson agreed to settle the lawsuit.

The settlement included a controversial requirement that Harley-Davidson fund a seemingly unrelated program to replace or retrofit wood-burning stoves with cleaner appliances, which appears to violate the agency’s own guidance on the issuance of consent decrees.

CoA Institute also issued a separate Freedom of Information Act (“FOIA”) request to the EPA for documents related to the settlement negotiations.

CoA Institute President and CEO John Vecchione: “EPA is erring by not implementing a mitigation project by Harley-Davidson that fits the violation as required by applicable rules. The Obama administration’s pattern of using settlements to fund favored political projects is a dangerous precedent that should be reviewed and reversed. Funneling settlement funds to pet projects should not supplant the congressional appropriations process or applicable rules that mitigation projects address the underlying harm caused.”

Unlike the defeat devices unknowingly installed in Volkswagen vehicles, the Harley-Davidson “defeat devices” were freely and intentionally purchased by individuals, and came with labels that detailed what “performance enhancements are considered street legal and for competition-use only” and warned against improperly using the devices. Harley-Davidson maintains that these products, which have been sold for over two decades, “[were] and [are] legal to use in race conditions in the U.S.”

The “Emissions Mitigation Project” included in the consent decree requires Harley-Davidson to fund a “wood-burning appliance changeout and retrofit.” The project is defined as a “supplemental environmental project” (“SEP”). However, in 2015, the EPA issued a guidance document outlining the legal requirements enforcement officials must adhere to when crafting an SEP.  The Harley-Davidson consent decree violates EPA’s guidance on SEPs by not establishing a sufficient nexus between the mitigation project and the alleged underlying violations.

In its letter, CoA Institute urges EPA Administrator Pruitt to reconsider the Harley-Davidson consent decree’s unlawful Emissions Mitigation Project, and replace it with a project that conforms to the SEP Policy’s sufficient nexus requirement.

The letter to Administrator Pruitt is available here The FOIA request is available here

For information regarding this press release, please contact Zachary Kurz, Director of Communications: zachary.kurz@causeofaction.org

High Seas and Misdirection: The Antiquities Act is not Among the Statutory Schemes that Govern U.S. Internal Waters, Oceans, and Coasts (Part 2)

Yesterday we provided a synopsis of certain statutory and regulatory schemes that govern America’s coastal and internal waters and reviewed the definitions of the jurisdictional zones that apply to United States’ waters. Today we continue our discussion of how the various schemes apply in the jurisdictional zones.

SOURCE: U.S. Commission on Ocean Policy, 2004.

A full description of all programs that touch on the jurisdictional waters of the United States and the activities that take place thereon is beyond the scope of this analysis. However, the following programs should inform—and in some cases are legally necessary to—any change in status relating to United States’ coastal and internal waters.

Land and Water Management Laws

The Coastal Zone Management Act (“CZMA”) was enacted to “preserve, protect, develop, and where possible, to restore or enhance, the resources of the nation’s coastal zone for this and succeeding generations;” with the purpose, “to encourage and assist the states to exercise effectively their responsibilities in the coastal zone through the development and implementation of management programs to achieve wise use of the land and water resources of the coastal zone, giving full consideration to ecological, cultural, historic, and esthetic values as well as the needs for compatible economic development.”

The CZMA is administered by the National Oceanic and Atmospheric Administration (“NOAA”) and thus falls under the jurisdiction of the Department of Commerce. Under the CZMA, states are incentivized to develop coastal management programs with the assurance that, with some exceptions, federal actions will be constrained to those that are consistent with state-developed and federally-approved coastal management programs (the “federal consistency” provision). More information about the CZMA may be found on NOAA’s website, and individual state coastal management programs may be accessed here. State coastal management programs can be quite extensive, addressing such diverse issues as seafloor and habitat mapping, flooding and erosion, lake access, education, beach management, seismic mapping, and protecting natural habitats and wildlife.

With the exception of Alaska, all 35 coastal and Great Lakes states and territories participate in the National Coastal Zone Management Program.

The Clean Water Act (“CWA”) was enacted to “restore and maintain the chemical, physical, and biological integrity of the Nation’s Waters.” The goals of the CWA were to make all waters safe for fish and people, and to eliminate the discharge of pollutants into the waters of the United States.[1] Amendments to the Act provide for estuary management and protection, with special programs authorized for the Chesapeake Bay, the Great Lakes, and Long Island Sound. The CWA is administered primarily by the Environmental Protection Agency (“EPA”), which has established a similar program for the Gulf of Mexico.[2] States that have a federally-approved coastal management program must develop and submit a coastal nonpoint[3] pollution control plan to NOAA and the EPA for approval, identifying land uses that contribute to coastal water quality degradation and critical coastal areas.[4]

The Submerged Lands Act (“SLA”) established in the states: “(1) title to and ownership of the lands beneath navigable waters within the boundaries of the respective States, and the natural resources within such lands and waters, and (2) the right and power to manage, administer, lease, develop, and use the said lands and natural resources all in accordance with applicable State law be, and they are, subject to the provisions hereof, recognized, confirmed, established, and vested in and assigned to the respective States.”[5] Natural resources, for purposes of the SLA, include oil, gas, and other minerals; and fish, shellfish, sponges, kelp, and other marine life; but do not include the use of water for the production of power.[6]

The Outer Continental Shelf Lands Act (“OCSLA”) established federal jurisdiction over the submerged lands “lying seaward and outside of” lands subject to the Submerged Lands Act extending “of which the subsoil and seabed appertain to the United States and are subject to its jurisdiction and control.” The Act purported to extend limited-purpose constitutional and political jurisdiction over the area:

The Constitution and laws and civil and political jurisdiction of the United States are extended to the subsoil and seabed of the outer Continental Shelf and to all artificial islands, and all installations and other devices permanently or temporarily attached to the seabed, which may be erected thereon for the purpose of exploring for, developing, or producing resources therefrom, or any such installation or other device (other than a ship or vessel) for the purpose of transporting such resources, to the same extent as if the outer Continental Shelf were an area of exclusive Federal jurisdiction located within a State: Provided, however, That mineral leases on the outer Continental Shelf shall be maintained or issued only under the provisions of this subchapter.[7]

Under the Act, the Secretary of the Interior is authorized to develop oil, gas, and other mineral deposits via permitting and leasing; and is also charged with suspending or prohibiting such activity “if there is a threat of serious, irreparable, or immediate harm or damage to life (including fish and other aquatic life), to property, to any mineral deposits (in areas leased or not leased), or to the marine, coastal, or human environment.” Activity under this Act must be coordinated with the CZMA and requires the Secretary to coordinate with other agencies and the affected states.[8]

Fishery and Species Management Laws

In 1976, the Fishery Conversation and Management Act, now the Magnuson-Stevens Fishery Conservation and Management Act (“Magnuson-Stevens Act”), extended exclusive U.S. fishery jurisdiction to 200 miles offshore, covering the area that later became the EEZ.[9] The Magnuson-Stevens Act established eight regional fishery management councils.

The Regional Councils are composed of members representing commercial and recreational fishing, environmental, and academic interests, as well as state and federal government. Regional Councils are required to:

  • Develop and amend Fishery Management Plans
  • Convene committees and advisory panels and conduct public meetings
  • Develop research priorities in conjunction with a Scientific and Statistical Committee
  • Select fishery management options
  • Set annual catch limits based on best available science
  • Develop and implement rebuilding plans

The Magnuson-Stevens Act has been amended by the Sustainable Fisheries Act of 1996 and the Magnuson-Stevens Fishery Conservation and Management Reauthorization Act of 2006, which were intended to strengthen sustainable fish stock requirements; promote market-based management strategies, such as catch shares; strengthen the role of science through peer review; and enhance international fisheries sustainability. Catch shares are exclusive allocations of fishing rights that are provided by the fishery management council and are transferable in accordance with the policy and criteria established by the controlling fishery management council.

Once a Fishery Management Plan has been written to include the ten national standards and research about the fishery, it must be submitted to the Secretary of Commerce for approval.[10] The Secretary also has independent authority to prepare a Fishery Management Plan for a region.[11]

The focus of the Magnuson-Stevens Act is on maintaining sustainable fisheries. Accordingly, the Magnuson-Stevens Fishery Act is administered by the National Marine Fisheries Service within the Department of Commerce. Additional information on the Magnuson-Stevens Act may be found here.

The Marine Mammal Protection Act (“MMPA”) differs from the Magnuson-Stevens Act in that it focuses on the health of marine mammal populations rather than on fishing yield. Subject to a few exceptions, the MMPA places a moratorium on the taking and importation of marine mammals and marine mammal products.[12] The MMPA is administered by two agencies—the National Marine Fisheries Service and the U.S. Fish and Wildlife Service within the Department of the Interior. The MMPA does not impose management responsibility on states or localities; however, a state may enter into a cooperative agreement for delegation of the administration and enforcement of the MMPA.[13]

The Endangered Species Act (“ESA”) also focuses on conservation of species and, like the MMPA, is administered by the National Marine Fisheries Service and the U.S. Fish and Wildlife Service.[14] The ESA does not mandate any permanent management structure that involves the states. However, Section 6 of the ESA does provide a mechanism for cooperation between the Fisheries Service and States in which the Fisheries Service is authorized to enter into agreements with any state that establishes and maintains an “adequate and active” program for the conservation of endangered and threatened species. Once a State enters into such an agreement, the Fisheries Service is authorized to assist in, and provide Federal funding for, implementation of the State’s conservation program.

The National Marine Fisheries Service also has obligations under the Fish and Wildlife Coordination Act and National Environmental Policy Act to consult, coordinate, and implement regulations regarding essential fish habitat with other federal agencies.[15]

These statutory frameworks are intended to work together in managing and protecting the coastal waters of the United States, in light of the interests of the coastal states, the preservation of marine life, natural resource development, and the interests of stakeholders such as fishermen, scientists, visitors, and foreign entities engaged in traditional uses of the seas (such as the right of safe passage). To achieve that purpose, coordination and accommodation is necessary to develop the comprehensive management plans required by, for example, the Coastal Zone Management Act and the Magnuson-Stevens Fishery Conservation and Management Act. Notably, this extensive coordination and balancing of local, federal, and international interests does not contemplate, and can be disrupted by, the sudden withdrawal of territory from the statutory schemes under the Antiquities Act; nor do these Acts include specific provisions for addressing lost rights; displaced scientific, commercial, or environmental planning; or conflict arising from a sudden change in jurisdiction between agencies.

Our series will continue next week with an update on the status of President Trump’s April 26 Antiquities Act Executive Order.

Any questions, commentary, or criticisms? Please e-mail us at kara.mckenna@causeofaction.org and/or cynthia.crawford@causeofaction.org

Cynthia F. Crawford is a Senior Counsel at Cause of Action Institute.
Kara E. McKenna is a Counsel at Cause of Action Institute. You can follow her on Twitter @Kara_McK

[1] 33 U.S.C. §1251.

[2] 40 C.F.R. 230.

[3] Nonpoint pollution refers to runoff from rain or snow that picks up and carries away natural and human-made pollutants into coastal and internal waters

[4] 16 U.S.C. §1455b.

[5] 43 U.S.C. §§1311.

[6] 43 U.S.C. §1301.

[7] 43 U.S.C. §1333(a).

[8] 43 U.S.C. §1334.

[9] 16 U.S.C. § 1801-1882.

[10] 16 U.S.C. § 1854(a).

[11] 16 U.S.C. § 1854(c).

[12] 16 U.S.C. § 1371.

[13] 16 U.S.C. §1379(a).

[14] 16 U.S.C § 1531 et seq.

[15] Review of U.S. Ocean and Coastal Law, Appendix 6, U.S. Commission on Ocean Policy, 2004, at 46.

High Seas and Misdirection: The Antiquities Act is not Among the Statutory Schemes that Govern U.S. Internal Waters, Oceans, and Coasts (Part 1)

We began our series of blog posts by examining the history, purpose, and limitations of the Antiquities Act of 1906, 54 U.S.C. §§ 320301 – 320303 (“Antiquities Act” or the “Act”) (here and here), followed by a discussion of how the Act fits within the variety of other frameworks for protecting and using public lands (here and here). This week we explore the variety of statutory frameworks and federal government programs that are used to manage the jurisdictional waters of the United States.

There are numerous programs and statutory frameworks that relate to the management and conservation of water, water-based activities, natural resources, and living marine resources within the United States’ internal and the coastal waters, including: the Coastal Zone Management Act (“CZMA”); the Magnuson-Stevens Fishery Act (“Magnuson-Stevens”); the Marine Mammal Protection Act (“MMPA”); the Endangered Species Act (“ESA”); the Clean Water Act (“CWA”); the Submerged Lands Act (“SLA”); and the Outer Continental Shelf Lands Act (“OCSLA”).[1] The Antiquities Act of 1906 has not traditionally played a role within this collection for reasons that will be explored in a later post.

The comprehensive statutory and regulatory schemes governing America’s coastal and internal waters often turn on exacting definitions of jurisdictional zones that apply to those waters, a matter complicated by the fact that the zones sometimes overlap—for example, the Contiguous Zone is wholly contained within the Exclusive Economic Zone (“EEZ”). Before examining the major programs that apply to United States’ coastal and internal waters, an overview of these jurisdictional zones is in order.

The jurisdictional zones, which include varying degrees of sovereignty, are measured relative to the baseline, which, in the United States, is defined as the low-water line along the coast as marked on the NOAA nautical charts in accordance with the articles of the Law of the Sea. Bodies of water that are inland from the baseline, such as bays, estuaries, rivers, and lakes, are considered internal waters and are subject to national sovereignty.

SOURCE: National Oceanographic and Atmospheric Administration (“NOAA”)

The zone closest to shore is the Territorial Sea, which measures from 0 to 12 nautical miles from the baseline. Within its territorial sea, the United States has sovereignty over the air space, water column, seabed, and subsoil.[2] Under the Submerged Lands Act of 1953, within the United States’ territorial sea, most coastal states have jurisdiction over the coast and the submerged lands and waters extending up to 3 nautical miles from their coastlines. Texas, Puerto Rico, and the Gulf Coast side of Florida differ from this standard, having jurisdiction over the submerged lands and waters extending 9 nautical miles from their coastlines.[3]

Generally, land above the mean hightide line is held in private ownership; while the land below the hightide line, including the tidewaters, is held in public trust by the state (although this varies by state). The federal government has jurisdiction over the balance of the Territorial Sea (beyond the 3 or 9-mile area), in addition to limited authority within the state’s jurisdictional waters. Under the SLA, the federal government has the right, authority, and jurisdiction to regulate commerce, navigation, power generation (from water), national defense, and international affairs throughout the state waters.[4]

International law recognizes a Contiguous Zone that stretches from 12 to 24 nautical miles from the baseline.[5] Within the contiguous zone the United States can enforce its customs, fiscal, immigration, and sanitary laws against foreign flag vessels.

The EEZ extends from 12 to 200 nautical miles from baseline.[6] Within the EEZ, the United States has sovereign rights for the purposes of exploring, exploiting, conserving, and managing the natural resources, both living and non-living, of the ocean waters, the seabed, and subsoil, and with regard to other economic or explorative activities, such as production of energy (wind, water, etc.), as well as jurisdiction over artificial islands or other structures and protection and preservation of the marine environment. President Reagan’s Proclamation of the EEZ stated that, “the Exclusive Economic Zone remains an area beyond the territory and territorial seas of the United States in which all States enjoy the high seas freedoms of navigation, overflight, the laying of submarine cables and pipelines, and other internationally lawful uses of the sea.” The EEZ has thus not been incorporated into the territory of the United States.

The continental shelf, under international law (UNCLOS), generally refers to the seafloor and subsoil (not the water column) beyond the territorial sea to the outer edge of the continental margin (including the shelf, the slope, and the rise) up to 200 miles from the baseline. It is similar in lateral extent to the EEZ but does not include the water column.[7] The United States, however, is not a party to UNCLOS and has separately declared jurisdiction over the natural resources of the subsoil and seabed of the continental shelf via the Truman Proclamation, as well as the right to free and unimpeded navigation upon the waters above the continental shelf. The essence of the Truman Proclamation was codified in the Outer Continental Shelf Lands Act.

The high seas are the areas of ocean that are beyond national jurisdiction, including the water column. Traditional freedoms on the high seas that apply to all nations include freedom of: surface and submerged navigation; flight; fishing; laying of cables and pipelines; scientific research; and the construction of artificial islands (and other structures).

Tomorrow we will address a variety of federal statutory frameworks that are used to manage and protect the jurisdictional waters of the United States.

Any questions, commentary, or criticisms? Please e-mail us at kara.mckenna@causeofaction.org and/or cynthia.crawford@causeofaction.org

Cynthia F. Crawford is a Senior Counsel at Cause of Action Institute.
Kara E. McKenna is a Counsel at Cause of Action Institute. You can follow her on Twitter @Kara_McK

[1] There are additional programs for protecting and using offshore federal waters, but the array is too extensive to cover here. Readers are directed to the Review of U.S. Ocean and Coastal Law, Appendix 6, U.S. Commission on Ocean Policy, 2004, for a more comprehensive review.

[2] Review of U.S. Ocean and Coastal Law, Appendix 6, U.S. Commission on Ocean Policy, 2004, at 5;  United Nations Convention on the Law of the Sea, Article 2 et seq. [hereinafter “UNCLOS”].

[3] See 43 U.S.C. § 1301(b).

[4] 43 U.S.C. §§1301(e), 1311(d), and 1314(e).

[5] Proclamation No. 7219, 64 Fed Reg. 48,701 (Sept. 8, 1999); see also UNCLOS Article 33.

[6] Proclamation No. 5030, 48 Fed. Reg. 10,605 (Mar. 14, 1983); see also UNCLOS Article 55 et seq.

[7] UNCLOS Article 76 et seq.

Court of Appeals Rules Vehicle Tech Company Has Right to Pursue Relief After Unfair Treatment by DOE on Renewable Loans

Washington, D.C. – The U.S. Court of Appeals for the District of Columbia today reversed the District Court’s ruling, siding with Cause of Action Institute’s (CoA Institute) client, Limnia Inc., an advanced vehicle technology company that alleged it was unfairly passed over for a government-backed loan and loan guarantee through the Department of Energy’s (“DOE”) politically-driven  programs.

CoA Institute President and CEO John Vecchione: “We are very gratified for the Court’s decision. The Circuit saw things our client’s way. We look forward to further advancing this case upon remand. But this is an important precedent laying out the parameters of voluntary remand to an agency.”

CoA Institute filed a lawsuit in 2013 on behalf of Limnia Inc. after the Department of Energy (“DOE”) failed to give the company fair treatment and the honest opportunity to compete for a government-backed loan under the agency’s controversial loan guarantee program to build advanced technology vehicles and components.

In 2008 and 2009, Limnia submitted two loan applications for $15 million in funding through DOE’s Advanced Technology Vehicles Manufacturing (“ATVM”) program. Limnia specializes in the production of battery systems for electric cars and applied for funding to develop a new advanced vehicle energy storage system. The DOE rejected both of Limnia’s applications.

Limnia sued DOE in the District Court alleging that the rejection of its applications was unlawful under the Administrative Procedure Act. In its complaint, Limnia argued it was passed over in favor of politically-favored competitors, such as Tesla Motors Inc., which had close connections to the Obama administration. Tesla received hundreds of millions in loans from the ATVM in early 2010.

Before the District Court could decide Limnia’s case on the merits, however, DOE requested that the case be remanded back to the agency. The District Court granted DOE’s request, returning Limnia’s case to the agency and closing Limnia’s judicial action. In today’s opinion, the Court of Appeals found that the District Court’s decision functioned as a dismissal of Limnia’s claims and authorized further judicial proceedings.

Limnia Inc. Chairman and Vice President of Product Innovation Scott Douglas Redmond: “We fought this fight on behalf of everyone who is sick of cronyism and corruption in Washington DC and tired of having their tax dollars used against them by corrupt political insiders. This is part one of a victory, not only for our team, but for the average citizen who doesn’t want their tax dollars going to politically connected projects.”

The full opinion is available here
Visit our blog for analysis of the opinion and more information about the case here

For information regarding this press release, please contact Zachary Kurz, Director of Communications: zachary.kurz@causeofaction.org

D.C. Circuit Rules Department of Energy May Not Use “Voluntary” Remand to Evade Judicial Review

In a victory for Cause of Action Institute’s client Limnia, Inc., the Court of Appeals for the District of Columbia Circuit ruled today that a district court erred in allowing the Department of Energy (“DOE”) to use a so-called “voluntary” remand to evade judicial review of its denial of Limnia applications for a renewable energy loan and loan guarantee.

The agency attempted to escape review of its actions after Limnia had prevailed on a motion to dismiss its Administrative Procedure Act (“APA”) claim that DOE arbitrarily and capriciously rejected its applications because of political favoritism.  DOE sought a “voluntary” remand to send the case back to the agency, but instead of seeking remand to reconsider its initial decision to deny Limnia’s applications, DOE required (and the district court agreed) that Limnia must submit brand new applications and pay significantly higher application fees.  This was the agency’s downfall.

The Court of Appeals made clear that “a voluntary remand request made in response to a party’s APA challenge may be granted only when the agency intends to take further action with respect to the original agency decision on review.  Otherwise, a remand may instead function, as it did in this case, as a dismissal of a party’s claims.”

Because DOE refused to reconsider the original decision, the district court’s decision to “close the judicial action left Limnia stuck between a remand and a hard place: Without any means – judicial or administrative – to obtain review of the Department’s 2009 application decisions . . . .  As a result, the District Court’s voluntary remand order was a ‘remand’ in name only.  Limnia’s position was the same as if its case had been dismissed on the merits.”

The decision also addressed whether the district court’s remand order was a final appealable order.  The Court of Appeals held that it was because it marked the end of the district court’s consideration of the case and because Limnia would be unable to seek review of the denied applications if the remand were permitted.  See pages 9–12.

Limnia also had asked the Court of Appeals to clarify the standard of judicial review for district court grants of contested remand motions.  The parties agreed that the standard should be for an abuse of discretion, but the Court of Appeals had not previously ruled on that question.  In a footnote, the Court said that, “[e]ven assuming that the standard of review is abuse of discretion rather than de novo, a question we need not decide, we agree with Limnia that the District Court’s decision must be reversed.”  Although this does not definitively resolve the question, the Court effective said that even under the more lenient abuse-of-discretion standard, the district court erred.  That is, the question presented was not close enough that the district court would have been affirmed under abuse-of-discretion review but reversed if the Court of Appeals considered the issue de novo.

The case now returns to the district court for further proceedings.

The Court’s decision continues CoA Institute’s string of victories on important administrative law issues in front of the D.C. Circuit.  Other significant wins include:

CoA Institute President and CEO John Vecchione argued the case; on brief with him were Josh Schopf and James Valvo.

James Valvo is Counsel & Senior Policy Advisor at Cause of Action Institute and you can follow him on Twitter @JamesValvo.

Cause of Action Institute Investigates Possible DOJ Involvement with Congressional Frustration of the FOIA

Cause of Action Institute (“CoA Institute”) filed a Freedom of Information Act (“FOIA”) request with the Department of Justice (“DOJ”) today in response to recent reports that Representative Jeb Hensarling, Chairman of the House Committee on Financial Services, directed the Department of the Treasury and at least eleven other agencies to treat all records exchanged with the Committee as “congressional records” not subject to the FOIA.

CoA Institute’s request is narrowly tailored to uncover records that could reveal whether the DOJ’s Office of Information Policy—which oversees government-wide compliance with and policy concerning the FOIA—and Office of Legislative Affairs were consulted by Chairman Hensarling, or others, prior to the release of the controversial FOIA directive. The request also seeks records concerning possible White House involvement and whether agencies sought the DOJ’s advice before responding to Chairman Hensarling.

Federal law requires that Congress manifest clear intent to maintain control over specific records to keep them out of reach of the FOIA. Chairman Hensarling’s directive is ineffective, in that regard.  As I have argued elsewhere, the mere fact that an agency possesses a record that relates to Congress, was created by Congress, or was transmitted to Congress, does not, by itself, render it a “congressional record.” And, as set forth in a coalition letter joined by CoA Institute, ignoring this well-established standard would “improperly restrict the ability of the public to use FOIA” and impede transparency and good government.

Ryan Mulvey is Counsel at Cause of Action Institute

FTC vs. D-Link Systems: What They’re Saying