Rocky Mountain Farmers Union v. Corey, No. 12-15131 (9th Cir. 2013)
Annotate this CaseRocky Mountain and American Fuels filed two separate actions against CARB, contending that the Low Carbon Fuel Standard, Cal. Code Regs. tit. 17, 95480-90, violated the dormant Commerce Clause and was preempted by Section 211(o) of the Clean Air Act, 42 U.S.C. 7545(o), known as the federal Renewable Fuel Standard (RFS). The court held that the Fuel Standard's regulation of ethanol did not facially discriminate against out-of-state commerce, and its initial crude-oil provisions (2011 Provisions) did not discriminate against out-of-state crude oil in purpose or practical effect. The court also held that the Fuel Standard did not violate the dormant Commerce Clause's prohibition on extraterritorial regulation. The court vacated the preliminary injunction and remanded to the district court for further considerations under Pike v. Bruce Church, Inc.
Court Description: Fuel Standards/Commerce Clause. The panel affirmed in part and reversed in part the district court’s summary judgment, and vacated the district court’s preliminary injunction and remanded in an action which alleged that California’s Low Carbon Fuel Standard, Cal. Code Regs. tit. 17, §§ 95480–90 (2011), violated the dormant Commerce Clause and was preempted by Section 211(o) of the Clean Air Act, 42 U.S.C. § 7545(o). The panel held that the Fuel Standard’s ethanol provisions were not facially discriminatory, and reversed that portion of the district court’s decision and remanded for entry of partial summary judgment in favor of California Air Resources Board (“CARB”). The panel also reversed the district court’s decision that the Fuel Standard was an impermissible extraterritorial regulation and the panel directed that an order of partial summary judgment be entered in favor of CARB on those grounds. The panel remanded the case for the district court to determine whether the ethanol provisions discriminate in purpose or effect and, if not, to apply the balancing test established in Pike v. Bruce Church, Inc., 397 U.S. 137 (1970). The panel affirmed the district court’s conclusion that the Fuel Standard’s crude oil provisions (the 2011 Provisions), were not facially discriminatory, but reversed the district court’s holding that the 2011 Provisions were discriminatory in purpose and effect. The panel directed the district court to enter an order of partial summary judgment in favor of CARB on those issues. The panel remanded to the district court to apply the Pike balancing test to the 2011 Provisions. The panel affirmed the district court’s conclusion that Section 211(c)(4)(b) of the Clean Air Act does not insulate California from scrutiny under the dormant Commerce Clause. The panel remanded to the district court with instructions to vacate the preliminary injunction. The panel expressed no opinion on plaintiffs’ claim that the Fuel Standard is preempted by the federal Renewable Fuel Standard (RFS). The panel also expressed no opinion on CARB’s claim that the savings clause in the Energy Independence and Security Act of 2007 precludes implied preemption by the RFS. Concurring in part and dissenting in part, Judge Murguia agreed with the majority’s conclusions concerning the crude oil regulations and preemption under the Clean Air Act. She dissented from the majority’s conclusion that ethanol regulations do not facially discriminate against interstate commerce.
The court issued a subsequent related opinion or order on January 22, 2014.
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