A recent decision of the United States Court of Appeals for the District of Columbia addresses important issues regarding challenges to regulatory action.  The case, Center for Regulatory Reasonableness v EPA, 2017 WL 763916, arose out of certain policy letters issued by EPA in 2011 that explained and arguably changed two EPA policies regarding publicly owned water treatment facilities.  The policy letters were challenged and the challengers prevailed in the Eighth Circuit Court of Appeals.  See, Iowa League of Cities v EPA, 711 F3d 844 (2013).   EPA then stated that it would not acquiesce to the Eighth Circuit’s decision outside of the Eighth Circuit and the Center for Regulatory Action challenged EPA’s non-acquiescence statements.

The court held that it did not have jurisdiction to hear the case because the Clean Water Act only gives courts of appeals jurisdiction to hear challenges to EPA-promulgated effluent or discharge standards and the non-acquiescence statements were not a “promulgation” because they did not announce a new standard.  Interestingly, the 2011 policy letters were a “promulgation.”  The Eighth Circuit’s decision had explained that whether an act is a “promulgation” depends on whether it has a binding effect on regulated parties.  Apparently, the court concluded that the 2011 letters had a binding effect, while the acquiescence letters merely explained the effect of the 2011 letters.

Next the court explained that to the extent that the Center for Regulatory Reasonableness was really challenging the 2011 letters, its challenge was untimely.  Challenge had to be within 120 days, as it was in the Eighth Circuit.

The result is that (1) the Eighth Circuit vacated the 2011 letters because they were the promulgation of effluent standards without notice and comment as required by the Administrative Procedure Act; (2) EPA accepts that decision as binding only in Eighth Circuit and treats the 2011 letters as binding in the rest of the country; and (3) the time to challenge the letters for violating the Administrative Procedure Act outside the Eighth Circuit has passed.

The Center for Regulatory Reasonableness may still find a way out of this unreasonable result, but the lesson learned is that when challenging regulatory action, you need to move quickly and you may not be able to rely on challenges in other jurisdictions.