CLEAN POWER PLAN

Can the Supreme Court stay be lifted? Does it matter?

Federal judges' consideration of how to handle a legal battle over the Clean Power Plan as the Trump administration unwinds the rule has lawyers from both sides puzzling over a thorny procedural issue with uncertain implications: Could the court's approach end an existing Supreme Court order freezing the rule? And if so, would it matter?

The questions revolve around the U.S. Court of Appeals for the District of Columbia Circuit's recent order temporarily freezing litigation over the Obama-era climate rule. The court late last month paused the case for 60 days and directed both sides to make arguments for whether it should keep the case on hold indefinitely or close it and remand the issue to U.S. EPA (Energywire, May 1).

Neither option will keep the Trump administration from continuing its efforts to unravel the Clean Power Plan, but many lawyers believe the second path — remand — could eventually trigger an end to the Supreme Court stay that has prevented the Clean Power Plan from taking effect since February 2016.

That's because the high court's stay is worded to follow the course of the litigation. The order freezes the rule "pending disposition" of the case at the D.C. Circuit and until the justices have a chance to consider anticipated appeals of that decision. It was issued well before anyone knew Donald Trump would take the White House, put the Clean Power Plan on the chopping block and send the legal battle off course.

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While lawyers on both sides acknowledge that the case has taken an unpredictable path, they disagree over exactly how a remand decision would affect the stay.

"On the one hand, people have said that if the rule is remanded, then there's no longer a pending case, and so the Supreme Court no longer has jurisdiction and the stay would automatically be dissolved," said Bracewell LLP partner Jeff Holmstead, a former EPA air official in the George W. Bush administration. "So that's one theory of what would happen.

"The other theory I've heard is because the Supreme Court has made it very clear in its order that it believed the rule should be stayed until the Supreme Court reaches a final resolution of it, it might somehow retain jurisdiction to keep the stay in effect," he added.

Court watchers have grappled with the two theories and reached divergent conclusions over the past week. The question of whether lifting the stay would make any meaningful difference is even more contentious, though all sides acknowledge that a stealth revival of the Clean Power Plan is unlikely.

"I have a hard time believing that somehow the Clean Power Plan is going to come back to life and come back to bite everybody because people haven't acted quickly enough," said Dorsey & Whitney attorney Jim Rubin, formerly of the Justice Department. "There are plenty of ways EPA can stop that from happening."

Lifting the stay

To environmental groups that have intervened in the litigation to defend the Clean Power Plan, the impacts of a D.C. Circuit decision to remand the case are clear.

"Our view remains that the stay, which was highly unusual, was by its very terms intended to hold things in place while the court adjudicated the merits of the Obama plan," Natural Resources Defense Council attorney David Doniger told E&E News after the latest D.C. Circuit order. "Remand ... would end the case, and that would end the stay."

Doniger and others say the alternative — keeping the stay in place indefinitely while EPA works on rescinding the Clean Power Plan — would be wildly unfair. They argued in briefs to the D.C. Circuit last month that the court "should not allow EPA to convert a limited stay pending judicial review into a long-term suspension of the Rule without judicial review" (Energywire, April 7).

On the flip side, critics of the Clean Power Plan say termination of the Supreme Court stay while EPA is rethinking the rule would be both unfair and illogical. While the five-justice majority did not lay out its reasons for granting the stay last year, rule challengers say the order signaled that the majority, at least on initial review, saw the Obama administration's plan as likely illegal.

"They're going to lift the stay so this rule goes into effect, really?" said BakerHostetler attorney David Rivkin, who represents Oklahoma against the rule. "That's absurd."

More fundamentally, Rivkin disputes the theory that a D.C. Circuit decision to remand would affect the stay at all. He says ending the litigation would not actually count as "disposition" under the terms of the Supreme Court order.

"This case will not be disposed of by the remand," he said. "That is not what remand means. ... The specific docket may be closed, but the case is not closed in a sense that there was a legal challenge to the rule. The rule remains alive and well — it exists until it's supplanted by a new rule.

"Only the Supreme Court can lift its own stays," he added.

Several industry lawyers expressed less certainty than Rivkin on the matter. Bracewell's Holmstead acknowledged termination of the stay as a possibility but said "it would be kind of odd if the D.C. Circuit could put the rule back into effect by remanding it."

Rubin, of Dorsey & Whitney, said, "I think the stay would dissolve if this case is remanded and nobody does anything with it."

Procedural hurdle

Environmental lawyer Sean Donahue — who is representing a coalition of groups in the litigation and noted that they have not yet decided any next steps — said it's possible an attempt to lift the stay would face a procedural hurdle.

"An order disposing of the case by remanding it would mean that the case is no longer pending," he said. "By its terms, the Supreme Court stay would remain in effect only until such time as a cert petition was either filed and finally disposed of or the time for review expires."

In other words, because the Supreme Court's order envisions one side petitioning the court for certiorari to review a D.C. Circuit decision, there's a possibility the Supreme Court will have to handle such a petition before the stay can be dissolved.

But without a merits decision from the D.C. Circuit, anyone seeking Supreme Court action could be in the unusual position of appealing the court's potential remand order — a procedural move the justices would not typically weigh in on.

"An order remanding the case is a final order that you could seek cert from, theoretically, so that may come into play," Donahue said. "But I don't think that there would be a serious issue of law for cert if the tenor of this remand were, 'We have a new administration that wants to revisit this rule; we're going to send it back to them.' That's not normally something the Supreme Court would get involved in."

If the cert issue does come into play, the timeline could look something like this: The D.C. Circuit could remand the case to EPA this summer, litigants would have 90 days to seek review at the Supreme Court, and the justices would likely handle the request in the fall. Some sources suggested the Supreme Court could use that process to clarify the terms of the stay and potentially extend it.

Does it matter?

Several Clean Power Plan opponents see all that legal maneuvering as a pointless exercise.

"This is all procedural wrangling without practical consequences," Rivkin said.

Holmstead argued that even if the stay were lifted, states and industry would have assurance that EPA would take action to prevent the rule from taking effect.

"From my time at EPA, I know that they would quickly take steps to clarify that no one needs to worry about doing anything to comply," he said. "EPA could easily stay the rule administratively for 90 days and then do a quick rulemaking to suspend the compliance deadlines until they take action to revoke or revise the rule. I just don't think having the Supreme Court stay lifted would be a big deal."

Rubin agreed, noting that EPA will likely continue to move quickly to roll back the Clean Power Plan.

President Trump's March 28 "energy independence" executive order requires the agency to review the rule, and EPA Administrator Scott Pruitt signed a Federal Register notice announcing its review the same day. Two days later, Pruitt wrote in a letter to governors that states "have no obligation to spend resources to comply" with the Clean Power Plan, citing the Supreme Court stay.

To supporters of the rule, the implications of lifting the stay are both practical and symbolic. Some think it could stop EPA from dragging its feet on a new rulemaking process — allowing anticipated challenges to the Trump administration's final decision to get in front of a court sooner.

Doniger said last week that it "would not allow them to hide behind this Supreme Court stay which has been transformed way beyond its original intentions."

The length of the Supreme Court stay could also affect eventual compliance dates if the rule were ever resurrected by a court or a future administration. Pruitt's letter to governors noted that EPA "supports the application of day-to-day tolling," the practice of extending compliance dates for the length of time a regulation is paused.

The day-to-day tolling approach, which environmental groups would oppose, would mean that if the stay continues for several years and the Clean Power Plan somehow comes back to life, its compliance dates would be bumped years into the future.

In the meantime

Litigants on all sides will continue grappling with those scenarios as they hone their playbooks for future action in the battle over the Clean Power Plan.

In the short term, they have a simpler question to answer: Should the D.C. Circuit remand the case to EPA or hold it in abeyance?

Supporters of the rule are still weighing their options but are holding out hope that the court will reject both paths and instead issue a decision on the major legal issues in the case.

Their position suffered a blow last week when the D.C. Circuit declined to reconsider a net neutrality case, and two Democratic appointees wrote that review would be "unwarranted," as the court "could find itself examining, and pronouncing on, the validity of a rule that the agency had already slated for replacement."

Challengers of the Clean Power Plan, meanwhile, may lean toward abeyance to preserve the litigation in case the Trump administration is unable to deliver the broad rollback it has promised.

"If, for whatever reason, they were to change their minds and not revoke or revise the Clean Power Plan, then you would immediately be able to pick up the case where it left off," Holmstead said.

It's unclear what position EPA will take, but the agency is expected to outline its efforts to rethink the rule.

"You have 10 judges, and obviously they're having a hard time figuring out what they ought to do in the case anyway," Rubin said. "They've asked for ideas on this because I think they'd like to know what the parties' equities are here, and particularly, I think, they're anxious to know what EPA's planning on doing."

Briefs are due next Monday.

Twitter: @ellengilmer Email: egilmer@eenews.net

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