[00:00:03] Speaker 04: Case number 16-1430, Truck Trailer Manufacturers Association and Petitioner versus Environmental Protection Agency et al. [00:00:12] Speaker 04: Ms. [00:00:13] Speaker 04: Theodore for the petitioner, Mr. Byron for the respondents, Ms. [00:00:16] Speaker 04: Henderson for the respondent interveners. [00:00:20] Speaker 07: Theodore. [00:00:22] Speaker 06: Good morning. [00:00:23] Speaker 06: Elizabeth Theodore on behalf of Petitioner Truck Trailer Manufacturers Association. [00:00:27] Speaker 06: I'd like to reserve five minutes for rebuttal, and I'll start with the EPA regulations and then turn to NHTSA. [00:00:33] Speaker 06: So the Clean Air Act speaks directly to the question whether the EPA can regulate trailers and make fear that it cannot. [00:00:39] Speaker 06: Section 7521 authorizes the EPA to regulate motor vehicles, and Section 7550 defines a motor vehicle as a self-propelled vehicle designed for transporting persons or property on a street or highway. [00:00:51] Speaker 06: And since trailers are not so propelled, that is game over for the EPA. [00:00:56] Speaker 06: And if the court had a chance to look at the 28-J letter that we filed yesterday, the IRS just reached the exact opposite conclusion from the EPA and said that that same language unambiguously excludes trailers. [00:01:07] Speaker 06: So one of these two rules violates the EPA and is clearly the EPA's rule. [00:01:12] Speaker 06: The self propelled limitation also precludes EPA's theory that it can regulate trailers as part of a quote unquote tractor trailer vehicle. [00:01:19] Speaker 06: Trailers are the only thing designed to transport people or property on the road or highway that is pulled by something else. [00:01:25] Speaker 06: And the term self-propelled had to have been designed to exclude trailers. [00:01:29] Speaker 06: EPA doesn't speed this and has no alternative explanation for this language. [00:01:33] Speaker 06: And that text would be completely meaningless and ineffective if the EPA could just regulate trailers on the ground that they're pulled by tractors and tractors are self-propelled. [00:01:41] Speaker 06: Congress obviously knew the trailers were hooked up to self-propelled vehicles when it chose to exclude them. [00:01:47] Speaker 06: The tractor-trailer theory fails for multiple other reasons. [00:01:50] Speaker 06: There's no such thing as a unitary tractor trailer vehicle. [00:01:54] Speaker 06: Tractor and trailers are never permanently married to each other. [00:01:56] Speaker 06: They're separately regulated under federal law. [00:02:00] Speaker 06: They have separate vehicle identification numbers under federal law. [00:02:03] Speaker 06: Many shippers own six trailers per tractor. [00:02:06] Speaker 05: Why do they have to be permanently married, as you said? [00:02:10] Speaker 05: You know, the question is, what is their status on roads and highways? [00:02:15] Speaker 05: And on roads and highways, when they're traveling on roads and highways, they are [00:02:21] Speaker 05: a single unit. [00:02:22] Speaker 05: That's how they transport property. [00:02:26] Speaker 06: So there's no one tractor and one trailer that's a single unit. [00:02:31] Speaker 06: And I mean, the proof is in the pudding. [00:02:32] Speaker 05: So the EPA claim... But why does... I'm asking why you would sort of... There's not one as in permanence, but maybe there's one somewhere in the country that I don't know of. [00:02:43] Speaker 05: But if there... I guess if there were, would that count? [00:02:46] Speaker 05: If there were, [00:02:48] Speaker 05: Actually, someone who owned both a tractor and a trailer and at least, you know, rented his service, her services out for moving stuff with that person then, with that, with that vehicle then, the trailer and tractor combined count? [00:03:02] Speaker 05: That still would not be a motor vehicle under, under. [00:03:05] Speaker 05: It doesn't matter whether it's permanent or not in your view. [00:03:09] Speaker 05: But then why isn't it when it's on the road together? [00:03:13] Speaker 05: That's what the statute is looking at is on the road and on the highway for the EPA on the road and on the highway. [00:03:18] Speaker 05: And that's how they function together. [00:03:21] Speaker 05: If I'm driving by a semi truck, I don't think I'm going just by the tractor. [00:03:26] Speaker 05: I'm going by the combination of the two. [00:03:28] Speaker 05: And if I feel like I'm hit by a semi truck, it's going to be the two of them together. [00:03:32] Speaker 05: That's going to be causing the terrible harm to me. [00:03:35] Speaker 05: And my understanding is that when you get to weigh stations, they weigh it together as a single unitary and that's what the gross vehicle weight at a way station measures is the single unitary weight of the thing of the tractor and its trailer and contents together. [00:03:50] Speaker 06: Well, so [00:03:54] Speaker 06: In the context of the Clean Air Act, it's very clear that the motor vehicle can't be the joint tractor and trailer. [00:03:59] Speaker 06: And just look at the rule itself. [00:04:01] Speaker 05: It's very clear. [00:04:03] Speaker 06: And I'll explain. [00:04:04] Speaker 06: So there's not a single aspect of this rule that actually regulates a joint tractor and trailer. [00:04:10] Speaker 06: And that's because it's impossible under the statute. [00:04:12] Speaker 06: So just one example is the certificate of conformity requirement in section 7522. [00:04:18] Speaker 06: That requires a certificate of conformity for a motor vehicle before it's sold. [00:04:22] Speaker 06: But you can't get a certificate of conformity for a joined tractor trailer because they're always sold separately and that's uncontested. [00:04:29] Speaker 06: So that provision would be impossible to apply if the quote unquote, regular, regular motor vehicle was the tractor trailer. [00:04:37] Speaker 06: And the regulation in fact requires a separate certificate of conformity for the tractor and for the trailer. [00:04:42] Speaker 06: It's not treating them as a single motor vehicle. [00:04:46] Speaker 06: And similarly, so the EPA can only regulate vehicle manufacturers under the statute. [00:04:52] Speaker 06: That's also uncontested. [00:04:54] Speaker 06: Trailer manufacturers don't manufacture tractor trailers. [00:04:56] Speaker 06: They only manufacture the trailer. [00:04:59] Speaker 06: And so the government relies on this engaged in language. [00:05:04] Speaker 06: But no one would say that Goodyear Tire Company is engaged in manufacturing [00:05:08] Speaker 06: vehicles just because it makes tires and tires goes on vehicles um and similarly the warranty provisions in section 75.41 are incoherent if the if the vehicle is the tractor trailer so that provision requires the manufacturer to warrant the motor vehicle to the so-called ultimate purchaser before it's sold um [00:05:28] Speaker 06: And first of all, there is no ultimate purchaser of a tractor trailer because, again, they're always sold separately. [00:05:36] Speaker 06: And second of all, EPA's theory would mean that the trailer manufacturer has to warrant that the entire tractor trailer complies, which is impossible because the trailer manufacturer has nothing to do with the tractor. [00:05:48] Speaker 06: And EPA's theory also, so it says that it can regulate trailers as like a quote unquote integral component of a tractor trailer that makes the Clean Air's authorization of motor vehicle engines and engine manufacturers utterly superfluous since engines are obviously an integral component of a vehicle. [00:06:03] Speaker 06: And so, so for all of those reasons, [00:06:05] Speaker 06: But again, I would return just to the use of the word self-propelled in the statute, which is obviously intended to exclude trailers. [00:06:11] Speaker 06: EPA has no authority to regulate that. [00:06:13] Speaker 05: Why isn't the tractor, for all intents and purposes, the engine that gets attached to the trailer and then makes the trailer move? [00:06:23] Speaker 05: That's really what the function of the tractor is, is to haul the trailer around, to make the trailer mobile and able to be moved to different places. [00:06:33] Speaker 06: Perhaps, but that doesn't make the trailer self propelled. [00:06:37] Speaker 06: It means the trailer is propelled by something else. [00:06:39] Speaker 05: It does talk about regulating both engines and vehicles. [00:06:44] Speaker 05: They both can be regulated. [00:06:45] Speaker 05: Yes. [00:06:47] Speaker 05: So it suggests to me that there's some regulation of vehicles that's distinct from regulation of an engine. [00:06:53] Speaker 06: So I think the goal of the separate authorization to regulate engines or vehicles just authorizes EPA to regulate engine manufacture separately so that they don't just have to apply regulations to engines in the context of regulating the motor vehicle after the engine has been incorporated. [00:07:09] Speaker 06: I think that's the real goal there. [00:07:11] Speaker 07: But why isn't this the incorporation when it becomes a tractor trailer, why isn't that the incorporation of the engine into the vehicle? [00:07:19] Speaker 06: So I think if the EPA wanted to regulate a motor carrier that assembles a tractor to a trailer, maybe they could do that. [00:07:27] Speaker 06: But they certainly can't regulate the trailer manufacturer. [00:07:30] Speaker 07: So the statute says manufacturing or assembling of the new motor vehicle. [00:07:36] Speaker 07: So when you say maybe, it seems like it's not a maybe. [00:07:38] Speaker 07: It definitely could regulate an assembler. [00:07:41] Speaker 07: Isn't that right? [00:07:42] Speaker 06: It definitely can regulate an assembler. [00:07:45] Speaker 06: I think there's a question whether putting the trailer to the tractor creates a motor vehicle for all the reasons I explained that like the certificate of conformity and warranty requirements. [00:07:54] Speaker 07: That's with respect to this regulation. [00:07:57] Speaker 07: Just to be hypothetical for a moment and picking up on Judge Millett's questions. [00:08:01] Speaker 07: So the term motor vehicle means any self-propelled vehicle designed for transporting persons or property on a street or highway. [00:08:10] Speaker 07: When it's assembled, it is self-propelled and it's designed for transportation on a highway. [00:08:18] Speaker 07: So that would seem to be able to [00:08:21] Speaker 07: regulate assemblers and require an assembler to only assemble a vehicle that meets the emission standards as an assembled vehicle? [00:08:32] Speaker 06: Potentially. [00:08:33] Speaker 06: Potentially. [00:08:35] Speaker 06: And we said in the regulatory comments, if EPA's theory that a tractor trailer is a motor vehicle under the statute has any legs, then the only thing they could do would regulate the assemblers. [00:08:45] Speaker 06: But there's no dispute that the trailer manufacturers, which is who is being regulated in this regulation, are not manufacturers and are not assemblers. [00:08:52] Speaker 05: Um, and let me, let me turn. [00:08:54] Speaker 05: Can I ask them. [00:08:55] Speaker 05: Sorry, I don't want to keep you from getting to what you want to get to. [00:08:58] Speaker 05: But if could EPA has a regulation that says Tractors are banned. [00:09:07] Speaker 05: These types of tractors are banned from traveling on roads and highways. [00:09:14] Speaker 05: If they're pulling loads [00:09:16] Speaker 05: that cause the tractor's emissions to increase by XX amount. [00:09:20] Speaker 05: And that XX is some fancy computation of sort of on average how much trailers cause tractor emissions to increase. [00:09:29] Speaker 05: Possibly. [00:09:30] Speaker 05: It could do that. [00:09:34] Speaker 05: It could do that, right? [00:09:35] Speaker 05: I don't see why it couldn't. [00:09:36] Speaker 05: That's a direct regulation of tractors and their emissions. [00:09:38] Speaker 05: I think, I think probably yes. [00:09:40] Speaker 06: And the, and the current getting to the, I'm sorry, go ahead and finish. [00:09:43] Speaker 06: The current tractor regulations do, do sort of assume a hypothetical trailer load as well, but it's not the same thing as regulating trailer manufacturers. [00:09:51] Speaker 05: But wouldn't that be, I guess it seems like it's, you're saying that they can do indirectly, they can't do directly where they can do indirectly, because if they were to pass something that said, no tractors can go on the road if their emissions [00:10:03] Speaker 05: are up at the level they would be if a trailer were attached. [00:10:06] Speaker 05: Everyone knows what's going to happen. [00:10:08] Speaker 05: Every trailer manufacturer is going to have to put on some of the things here, the aerodynamic curtains and the backing and the tires and everything to get themselves under that limit. [00:10:21] Speaker 05: Otherwise, no one's going to be able to pull their trailers. [00:10:24] Speaker 06: Well, so the members of the TTMA are actually totally fine with attaching equipment that their customers demand. [00:10:30] Speaker 06: But it does make a difference who a regulation regulates, right? [00:10:33] Speaker 06: So motor vehicle manufacturers, like their billion dollar organizations, trailer manufacturers, the overwhelming majority are small businesses. [00:10:42] Speaker 06: And this regulation imposes huge compliance costs. [00:10:47] Speaker 06: And Congress didn't intend for trailer manufacturers to bear those costs. [00:10:50] Speaker 06: And it's clear that it didn't because it used the word self-propelled. [00:10:55] Speaker 06: Let me turn to the NHTSA rules. [00:10:57] Speaker 06: So the EPA's clear lack of statutory authority means that the court should vacate the entire portion of the rule because NHTSA's rules are non-severable from EPA's. [00:11:06] Speaker 06: And under the broadcasters case, a rule is non-severable if the agency didn't intend severability or if the remainder of the regulation couldn't function sensibly without the stricken provision. [00:11:16] Speaker 06: Similarly, the Supreme Court said in Kmart that it's non-severable. [00:11:20] Speaker 06: It's striking the invalid parts would impair the function of the regulation as a whole. [00:11:24] Speaker 05: Have those rules ever been applied when you're dealing not with a single set of regulations, but separate regulations issued by two different agencies? [00:11:34] Speaker 05: Is severability even the analysis to determine whether those regulatory schemes function? [00:11:40] Speaker 06: Yes, Your Honor, for a couple of reasons. [00:11:43] Speaker 06: First of all, I mean, all of this court's discussion and the Supreme Court's discussion of the rule is it takes the text, which is the rule, and looks at each part. [00:11:53] Speaker 06: But more specifically, in the Delta case, which is this court's case, the court did essentially apply a separability analysis to a joint EPA NHTSA rule. [00:12:02] Speaker 06: And it said that they were separable because in that case, NHTSA's rules weren't dependent on EPA's. [00:12:09] Speaker 06: And that's just the severability analysis. [00:12:11] Speaker 06: So you want them to be not severable, right? [00:12:15] Speaker 03: I'm sorry? [00:12:16] Speaker 03: I thought you wanted them to be not severable. [00:12:18] Speaker 03: And in Delta, they were severable. [00:12:21] Speaker 06: In Delta, they were severable. [00:12:22] Speaker 06: And Delta is just example of the court applying the severability analysis in the same way to a joint agency rule. [00:12:28] Speaker 06: Here, of course, the rules are very clearly dependent on the EPA's rules. [00:12:34] Speaker 03: Can you elaborate on that a little bit? [00:12:38] Speaker 03: I took your reply brief to focus in particular on three aspects of the regulation that would not work if you took the EPA out of it. [00:12:51] Speaker 03: And hopefully I can remember all three right here. [00:12:55] Speaker 03: One was the compliance certificate, certificate of conformity. [00:12:58] Speaker 03: Only EPA can issue that. [00:13:01] Speaker 03: Another was the setting of the standards under the regulations. [00:13:05] Speaker 03: EPA sets the standards. [00:13:08] Speaker 03: And then the third was the testing. [00:13:12] Speaker 03: So to see whether or not a particular trailer would satisfy the standards that EPA sets, the regulation imagines that the EPA will do the testing. [00:13:26] Speaker 03: The government says that [00:13:30] Speaker 03: that will all basically work even if you take EPA out of the equation. [00:13:35] Speaker 03: Can you go through each of those three and explain why you think that's wrong? [00:13:42] Speaker 06: Sure. [00:13:42] Speaker 06: And let me start with the certificate of conformity. [00:13:47] Speaker 06: So there's no dispute that the EPA is not issuing certificates of conformity because this court stated its rules and held that it doesn't have authority to regulate trailers. [00:13:56] Speaker 06: And the NHTSA standards in particular section 535.10 state that manufacturers may not introduce vehicles into commerce without a certificate of conformity from EPA and that manufacturers not completing these steps do not comply with the NHTSA fuel consumption standards. [00:14:13] Speaker 03: And you obviously can't- The government, I'm sorry to interrupt, but the government says we just scratched that part out. [00:14:18] Speaker 03: So now the trailer manufacturers don't ever have to get a certificate of conformity problem solved. [00:14:26] Speaker 06: Right. [00:14:27] Speaker 06: So, and there's sort of two responses to that. [00:14:29] Speaker 06: The first is that's not the way separability analysis works, right? [00:14:32] Speaker 06: The question isn't could the rules be rewritten in a way that would allow them to function. [00:14:36] Speaker 06: The question is whether the rules as written can function without the stricken provisions, and that's very clear. [00:14:41] Speaker 06: And second, you can't strike the certificate of conformity requirement. [00:14:46] Speaker 06: I mean, it's the core part. [00:14:47] Speaker 06: It's a core regulatory requirement, and it's the only way that trailer manufacturers can even be assured that their vehicles are in fact compliant with the substantive standards. [00:14:56] Speaker 06: So, I mean, you can ask the government, but I just don't know how the regulation could possibly function. [00:15:01] Speaker 03: On the other two, the setting of the standards and the testing, couldn't EPA just continue to set standards that on their own do not have force of law, but NHTSA could take the standards that EPA sets and apply them to trailers with the force of law? [00:15:21] Speaker 03: And same with the testing. [00:15:22] Speaker 03: EPA could still do the testing. [00:15:23] Speaker 03: You wouldn't get fined by EPA if you violate EPA's test, but you would get fined by NHTSA. [00:15:32] Speaker 06: I don't think so, Yara, and I'll provide the same response, which is that the regulations as written just don't make any sense. [00:15:38] Speaker 06: They can't function if you strike the EPA regulations because they would be cross-references to nothing, to invalid provisions. [00:15:45] Speaker 06: But also, EPA can't regulate without congressional authority. [00:15:48] Speaker 06: I mean, NHTSA can't outsource its authority to another agency without congressional authority to do that. [00:15:53] Speaker 06: And look, I mean, the agencies don't even really believe what they're saying because the fact of the matter is EPA is not conducting the testing right now. [00:16:00] Speaker 06: It's not issuing certificates of conformity. [00:16:02] Speaker 06: And that's because this court said it didn't have authority to do so. [00:16:06] Speaker 03: One last question, Ms. [00:16:08] Speaker 03: Theodore. [00:16:08] Speaker 03: Do you have a sense of what this costs, this regulation of trailers? [00:16:15] Speaker 06: For the trailer manufacturers? [00:16:17] Speaker 03: For the economy, yeah, for the trailer manufacturers. [00:16:20] Speaker 06: I don't know for the economy, but for the trailer manufacturers, it depends on the manufacturer. [00:16:24] Speaker 06: But for some of them, the compliance will cost millions of dollars. [00:16:27] Speaker 06: And again, these are small businesses. [00:16:29] Speaker 06: This is a big deal for them. [00:16:31] Speaker 03: But I mean nationwide, do you have a sense, are we talking about a billion dollar impact on the industry, more than a billion? [00:16:39] Speaker 03: It's OK if you don't know. [00:16:40] Speaker 03: I'll ask the government the same question. [00:16:43] Speaker 06: Yeah, I don't know the answer to that. [00:16:46] Speaker ?: OK. [00:16:48] Speaker 06: So I think the NHTSA rules are way more intertwined than other. [00:16:54] Speaker 06: rules that this court has held non-separable before. [00:16:58] Speaker 06: And I don't think this is really subject to reasonable dispute. [00:17:03] Speaker 06: There's no way that NHTSA would have adopted this exact same regulation, cross-referencing EPA's rules 400 times. [00:17:09] Speaker 07: Can I ask, is that the question about function, question of NHTSA's intent, or just a question of whether it's arbitrary and capricious? [00:17:20] Speaker 07: if we sever apart and leave the rest. [00:17:24] Speaker 07: I mean, the intent is clear. [00:17:26] Speaker 07: They've said what their intent is. [00:17:27] Speaker 07: We wanted to stand alone. [00:17:29] Speaker 07: It could still be arbitrary and capricious. [00:17:31] Speaker 07: And that, I think, is what the function test goes to. [00:17:34] Speaker 07: I don't see. [00:17:35] Speaker 07: Or in a circumstance where the agency hasn't told us what their intent is, then, of course, you would look at it. [00:17:41] Speaker 07: Do you think that's the right kind of analysis? [00:17:43] Speaker 06: I think the function test is independent of the intent test, and that's what the court said in broadcasters. [00:17:49] Speaker 07: Independent because what are we relying on for it? [00:17:53] Speaker 07: What authorizes the court to make a function test? [00:17:57] Speaker 07: Is it the Arbitrar and Capriccius standard? [00:18:00] Speaker 06: I don't think so, because the same analysis applies to statutes as well. [00:18:05] Speaker 07: In the case that you cite, there it's used to determine intent where intent isn't clear. [00:18:13] Speaker 07: I'm asking you, where would we get the authority to simply say that this doesn't function unless it's because it's arbitrary and capricious without the other part of it? [00:18:28] Speaker 06: I mean, I suppose you could say that. [00:18:31] Speaker 06: I don't know, but it's clear the court does have the authority because, I mean, the Supreme Court has the Kmart decision, which says that the question is whether striking one part of the regulation would invalidate the, would impair the function of the regulation as a whole. [00:18:45] Speaker 07: So it may be that- Do you want to remind me in that case, did Congress express its intent? [00:18:52] Speaker 06: In the Kmart case? [00:18:53] Speaker 06: Yeah. [00:18:53] Speaker 06: It was a regulatory case. [00:18:56] Speaker 07: OK, then in that case, did he express himself? [00:19:00] Speaker 06: I'm not sure. [00:19:01] Speaker 06: But I can say that in the broadcasters case from this court, the agency did have a severability clause, and nonetheless held that the regulations were non-severable because they couldn't function independently. [00:19:12] Speaker 07: Which sounds like because they were arbitrary and capricious. [00:19:15] Speaker 07: Perhaps. [00:19:16] Speaker 07: They have a rule that doesn't function. [00:19:19] Speaker 06: And I think that makes a lot of sense as the explanation for the analysis. [00:19:23] Speaker 07: OK, thank you. [00:19:25] Speaker 06: So let me turn quickly to the NHTSA question. [00:19:28] Speaker 06: Even if the rules were severable, NHTSA lacks authority to regulate that quote unquote fuel economy of trailers. [00:19:35] Speaker 06: And that's because trailers don't have fuel economy under the definition in the ISA. [00:19:42] Speaker 06: NHTSA agrees that trailers don't consume fuel. [00:19:45] Speaker 06: And so the standards that are being issued here are not fuel economy standards within that definition. [00:19:51] Speaker 06: And second, trailers aren't vehicles within the meaning of ESA either. [00:19:55] Speaker 06: Vehicle in this context clearly means fuel-consuming vehicles. [00:19:59] Speaker 06: That's what all the other vehicles in the list are. [00:20:01] Speaker 06: And section 108 of the ESA refers interchangeably to this category of vehicles as trucks, which under the statute and under NHTSA's long-standing regulatory definition does not include trailers. [00:20:14] Speaker 06: And I'd like to reserve the remainder of my answer. [00:20:16] Speaker 07: Can I ask the NHTSA's Organic Act, [00:20:21] Speaker 07: as a motor vehicle means a vehicle driven or drawn by mechanical power. [00:20:27] Speaker 07: So if you're looking anywhere for the closest definition, you would look at this agency's own statute, and this is clearly a vehicle driven by or drawn by mechanical power. [00:20:39] Speaker 07: In fact, it is a vehicle drawn by mechanical power. [00:20:42] Speaker 06: Well, Congress did not, of course, incorporate those provisions into the ESA, did not incorporate that definition. [00:20:49] Speaker 07: That's true. [00:20:50] Speaker 07: But they also didn't incorporate the EPA's definition of vehicle. [00:20:54] Speaker 06: That's true. [00:20:54] Speaker 06: And we're not relying on the EPA's definition to analyze the meaning of vehicle in the ESA. [00:21:00] Speaker 06: But there are a number of other textual clues, including the statute's focus on fuel, the definition of fuel economy, the fact that the statute refers interchangeably to trucks, [00:21:10] Speaker 06: Um, when it's describing this category of vehicle and trucks, of course, are vehicles that have motive power. [00:21:15] Speaker 06: Um, the fact that the one provision of, of the ESA, which refers to trailers also distinguishes between trailers and trucks. [00:21:22] Speaker 06: Um, and the fact, so, so, I mean, all of those are, are very strong textual clues that what Congress meant here did not include trailers. [00:21:34] Speaker 07: All right. [00:21:34] Speaker 07: Further questions from the bench? [00:21:37] Speaker 07: If not, we'll go to Mr. Byron. [00:21:44] Speaker 01: Thank you, Judge Garland. [00:21:45] Speaker 01: May it please the court, Thomas Byron from the Department of Justice here on behalf of the federal government agencies. [00:21:50] Speaker 01: Both NHTSA and EPA independently exercised their authority under their respective statutes and interpreted ambiguities in those statutes to permit the agencies to regulate tractor trailers as the relevant vehicles subject to fuel efficiency and greenhouse gas emissions regulations. [00:22:14] Speaker 01: The statutes themselves do not address, Congress, that is to say, did not specifically preclude the agencies from regulating tractor trailers as motor vehicles in this way. [00:22:29] Speaker 01: So this question comes down to step two of Chevron and the reasonableness of each agency's explanation for its statutory interpretation. [00:22:39] Speaker 01: And here the agencies are by Mr. Byron. [00:22:44] Speaker 03: NHTSA just recently, I'm gonna try to find this, issued a regulation in 2020 that said it talks about a vehicle and a trailer attached to the vehicle. [00:22:58] Speaker 03: And that it cited in the manufacturer's brief, it's from April 30th, 2020. [00:23:03] Speaker 03: If NHTSA itself talks about a trailer, [00:23:10] Speaker 03: as recently as this year as not being a vehicle, but rather being something that is attached to a vehicle. [00:23:20] Speaker 03: What do I do with that? [00:23:25] Speaker 01: Judge Walker, I think you're referring to what the agencies call the safe rule, which is under NITS's CAFE authority, that is the Corporate Average Fuel Economy Authority governing automobiles and light trucks. [00:23:38] Speaker 01: does not, of course, cover or even in any way turn on any other regulation that does affect tractor trailers. [00:23:50] Speaker 01: So there's no doubt. [00:23:53] Speaker 03: It's not talking about tractors and trailers. [00:23:54] Speaker 03: It's talking about a regular car and something that might hitch to the back of a regular car. [00:23:59] Speaker 01: That's exactly the focus of the safe rule and the CAFE scheme as a whole, which does not cover tractor trailers. [00:24:07] Speaker 03: Before I forget, do you have a sense of the question I asked Ms. [00:24:10] Speaker 03: Theodore about what this costs the industry? [00:24:13] Speaker 01: Your Honor, I don't recall the specifics, but I can point you to the part of the record that does address that. [00:24:19] Speaker 01: And that is the impact analysis and the regulatory impact analysis [00:24:26] Speaker 01: So the RIA, the regulatory impact analysis begins at JA 429. [00:24:30] Speaker 01: The impact assessment by the agencies in the final rule. [00:24:36] Speaker 01: And this is not specifically the economic impact on the industry, but that section begins at JA 135. [00:24:44] Speaker 01: And within that section, my memory is that the agencies [00:24:47] Speaker 01: It addressed the economic impact on trailer manufacturers specifically. [00:24:52] Speaker 01: I apologize, I don't have the specific pages. [00:24:54] Speaker 03: I'll stop interrupting you, at least for now. [00:24:56] Speaker 01: Not at all, Your Honor. [00:24:58] Speaker 01: So I do want to link the question you asked about the CAFE regulations to EPA's analysis of its statutory authority here, which I think confirms the point that Judge Millett was getting at in one of her questions, which is how the agencies here undertook a real world analysis, a practical analysis of how [00:25:22] Speaker 01: Tractor trailers as motor vehicles are perceived as a single vehicle proceeding down the highway by other vehicle operators. [00:25:30] Speaker 01: That's important here, and it does reflect as well the room that Congress left within both statutes. [00:25:37] Speaker 01: But when EPA was interpreting its authority under the Clean Air Act to regulate [00:25:44] Speaker 01: tractor trailers as motor vehicles. [00:25:46] Speaker 01: One thing they made very clear is that the tractor without the trailer or the trailer without the tractor is not itself a single vehicle. [00:25:53] Speaker 01: Only because the two are designed to work together, are they a single motor vehicle. [00:25:59] Speaker 01: That's quite different, the agency explained, from an automobile or a light truck pulling a separate trailer, which is what I think you were referring to [00:26:10] Speaker 01: in the safe rule, if I recall correctly. [00:26:12] Speaker 01: Unfortunately, I don't have the safe rule in front of me. [00:26:15] Speaker 01: The agency explained that that significant difference is what underlies its statutory interpretation here. [00:26:22] Speaker 01: The tractor trailer is the vehicle subject to regulation. [00:26:26] Speaker 05: I guess I'm a little confused about that because surely you regulate the track. [00:26:30] Speaker 05: If you had someone who had one of these tractors and just liked driving this great big thing down the road, never attach trailers to it. [00:26:38] Speaker 05: that tractor would be completely regulated by whether it attaches or not to trailers. [00:26:43] Speaker 05: That tractor is itself regulated by these provisions because it's transporting a person. [00:26:50] Speaker 01: Your honor, the question isn't whether any individual driver intends to use it. [00:26:54] Speaker 01: The question is whether the vehicle under 7521-2 is designed for transporting persons or property. [00:27:02] Speaker 01: And that tractor is designed for transporting property. [00:27:05] Speaker 05: It's also designed for transporting the driver. [00:27:08] Speaker 01: I don't think that's an accurate understanding and that's certainly not the interpretation that EPA has given to that provision and that interpretation is a reasonable one, Your Honor. [00:27:19] Speaker 01: The tractor is designed to function as part of the tractor trailer vehicle. [00:27:24] Speaker 05: I guess I'm having a little trouble understanding that because one, I've seen these tractors going down the road by themselves, presumably they've dropped off a load, don't have another one to pick back or they're driving to the next place to pick up [00:27:34] Speaker 05: a load, and it's definitely designed to transport the person to and from, shall we say, work, where they pick up trailers. [00:27:42] Speaker 05: A lot of them have little cabs in the back with little bedrooms and everything. [00:27:45] Speaker 05: They're definitely designed to carry that person to and from hauling assignments. [00:27:51] Speaker 05: And then carries that person through the hauling assignment. [00:27:55] Speaker 05: And are you saying you can't regulate the emissions of the tractor itself? [00:28:02] Speaker 01: Judge, the agency has not said that, and I'm not taking that position here. [00:28:07] Speaker 01: What the agency has said and what we are defending here is the proposition that these tractor trailers operate as single vehicles on the highway. [00:28:18] Speaker 01: They're designed to operate that way as single vehicles. [00:28:22] Speaker 01: And each part of the tractor trailer is subject to the requirement that EPA [00:28:29] Speaker 01: imposes that any manufacturer of a motor vehicle and that includes both the tractor manufacturer and the trailer manufacturer here can be required to obtain a certificate of conformity under the Clean Air Act regulations. [00:28:43] Speaker 01: The any manufacturer language is what really does a lot of the work here. [00:28:48] Speaker 01: And I don't think that petitioners argument fairly addresses the statutory scheme as a whole by focusing solely on the motor vehicle, because here the motor vehicle is the tractor trailer as a single vehicle. [00:29:02] Speaker 01: Both manufacturers are within the statutory requirement of any manufacturer that can be required by EPA to obtain their certificate of conformity. [00:29:13] Speaker 05: All of that is it's not a vehicle even under your view. [00:29:16] Speaker 05: It's not a covered vehicle until the two are put together. [00:29:19] Speaker 01: No, I don't think that's right, Judge Mallette. [00:29:21] Speaker 01: It certainly is a motor vehicle when the two are put together. [00:29:25] Speaker 01: And by the way, I think you asked about whether there are some operators, and again, it doesn't matter whether an individual operator does anything, it's how they're designed. [00:29:32] Speaker 01: But it's certainly true as well, and the record reflects that some operators do keep their tractor and their trailer combined full-time, essentially. [00:29:41] Speaker 01: But that's not essential here. [00:29:43] Speaker 01: And the key point is that [00:29:46] Speaker 01: The agency understood its authority to cover the tractor trailer when both parts are designed to work together and that both manufacturers can be subject to those regulations. [00:29:58] Speaker 05: Is there any manufacturer that manufactures both the tractor and the trailer? [00:30:03] Speaker 01: I'm not aware of any, Your Honor. [00:30:05] Speaker 01: But again, [00:30:06] Speaker 01: The whole idea of any manufacturer is an expansive concept. [00:30:10] Speaker 01: The word any is expansive, as this Supreme Court have recognized. [00:30:14] Speaker 01: But fundamentally, it doesn't matter whether the Clean Air Act or EPCA, as modified by ISA, authorizes an agency to regulate tractor trailers as long as the other statute does. [00:30:30] Speaker 01: And here, no matter what the court thinks about one authority, the other authority in this case, NHTSA's authority under APCA is ample to support the regulations of NHTSA to oppose fuel efficiency requirements on track. [00:30:52] Speaker 03: So Mr. Byron, on that point, can you walk through the three things that I was asking Ms. [00:30:57] Speaker 03: Theodore about? [00:31:00] Speaker 03: we find the EPA didn't have the authority to do this. [00:31:03] Speaker 03: Let's say we find that NHTSA did. [00:31:06] Speaker 03: NHTSA's regulation mentions EPA, I think, 400 times. [00:31:10] Speaker 03: And in particular, there are at least three things that the manufacturers argue just don't work in this regulatory scheme when you take EPA out of it. [00:31:23] Speaker 03: One is the compliance certificate. [00:31:25] Speaker 03: One is that only EPA issues. [00:31:26] Speaker 03: One is the standards that only EPA sets. [00:31:29] Speaker 03: and one is the testing that only EPA does. [00:31:32] Speaker 03: Can you talk about how each one of those things, what would happen to each of those things if we strike down the EPA's authority, but we find that NHTSA did have authority? [00:31:42] Speaker 01: Certainly Judge Walker, and if I may step back just for a moment to put that in context, the key point here is that all three of those are elements of the compliance mechanism that each agency adopted with respect to its own requirements. [00:31:58] Speaker 01: And so the fact that NHTSA required, in order to demonstrate compliance with the fuel efficiency regulation, required a manufacturer to obtain a certificate of conformity from EPA [00:32:10] Speaker 01: that's merely a mechanism of demonstrating compliance with the fuel efficiency regulation. [00:32:15] Speaker 01: It's not itself a predicate that requires EPA to have independent regulatory authority under the Clean Air Act to set its own standards. [00:32:25] Speaker 03: Are you saying NHTSA would allow a trailer to be manufactured even absent an EPA certificate of conformity? [00:32:33] Speaker 01: Well, I think, Judge Walker, that two alternative approaches are equally available to the court in the scenario you've outlined. [00:32:40] Speaker 03: I do want to hear them, but can you answer that one first? [00:32:45] Speaker 03: Would NHTSA allow a trailer to be manufactured that doesn't get an EPA? [00:32:51] Speaker 03: certificate of conformity. [00:32:52] Speaker 01: So yes, your honor, if this court were to hold that the EPA regulations providing a mechanism for trailer manufacturers to obtain a certificate of authority were themselves invalid, then yes, of course, NHTSA would permit other mechanisms to comply, demonstrate compliance with the fuel efficiency regulations. [00:33:13] Speaker 03: Are those mechanisms in the regulations already or wouldn't it make them up? [00:33:19] Speaker 01: Well, Your Honor, I think there's not an alternative specified to obtaining a certificate of conformity. [00:33:28] Speaker 01: But there are other ways that NHTSA's regulation specifies that trailer manufacturers can demonstrate their compliance with the fuel efficiency regulations by submitting the compliance information either through EPA's database or directly to NHTSA, to its own database, or to the CAFE database. [00:33:49] Speaker 03: But I thought you just said NHTSA won't allow a trailer to be manufactured if it doesn't get an EPA certificate of conformity. [00:33:55] Speaker 01: Well, Your Honor, if this court strikes down, and this is the important point that I need to return to in just a moment, but if this court were to strike down the EPA regulation that permits trailer manufacturers to obtain a certificate of conformity, of course, as a consequence of that, NHTSA could not require [00:34:15] Speaker 01: trailer manufacturers to do something that this court said they cannot. [00:34:18] Speaker 03: Okay, so that first of the three things is no longer a requirement. [00:34:21] Speaker 03: What about the other two? [00:34:22] Speaker 03: EPA sets the standards and EPA tests. [00:34:24] Speaker 03: What happens to them? [00:34:25] Speaker 01: Judge Walker, can I just return to the other aspect of this that I didn't get to, which is that this court could strike down EPA's Clean Air Act, greenhouse gas emission standards, without striking down [00:34:38] Speaker 01: the provisions that allow trailer manufacturers, like other heavy duty vehicle manufacturers, to obtain a certificate of conformity. [00:34:46] Speaker 01: In other words, the certificate of conformity is not available because NHTSA has specified that the certificate of conformity is required. [00:34:55] Speaker 01: This court could conclude [00:34:57] Speaker 01: that the certificate of conformity mechanism could remain in place to permit compliance with NHTSA's regulation. [00:35:05] Speaker 01: My point was that both paths are available. [00:35:08] Speaker 07: Could you just say a little more on that? [00:35:10] Speaker 07: I'm sorry to interrupt also as long as you're on that topic. [00:35:12] Speaker 07: So what would be, if we were to say that trailer is not a vehicle under the Clean Air Act, what would be EPA's authority to issue certificates of compliance? [00:35:26] Speaker 01: Judge Garland, of course, a lot would depend on what this court concluded about the scope of the Clean Air Act and the EPA's authority. [00:35:34] Speaker 01: But unless this court were to conclude that its interpretation of the Clean Air Act precludes EPA from assisting NHTSA in compliance with the fuel efficiency regulations. [00:35:46] Speaker 07: So I'm asking what permits it to assist in that way. [00:35:50] Speaker 07: So assume all we hold is that [00:35:52] Speaker 07: It's not self-propelled. [00:35:53] Speaker 07: That means that the regulation of emissions of trailers isn't permitted. [00:36:00] Speaker 07: What authority remains for the certificate of compliance? [00:36:06] Speaker 01: Well, your honor, remember the distributed compliance mechanism in the EPA regulations is not directed solely to trailer manufacturers but to all heavy duty and in fact other vehicle manufacturers as well. [00:36:20] Speaker 01: And here, NHTSA merely adopted the existing [00:36:24] Speaker 01: regulatory scheme. [00:36:26] Speaker 01: Now it happens that the regulatory scheme at the time NHTSA adopted it. [00:36:31] Speaker 01: And again, this was to reduce the burden on manufacturers. [00:36:33] Speaker 01: So the petitioner here is turning a regulatory virtue into a vice. [00:36:38] Speaker 01: But the point of adopting that existing framework [00:36:42] Speaker 01: was to minimize the burden on manufacturers. [00:36:46] Speaker 01: In doing so, even if EPA didn't have authority to adopt that framework with respect to trailers on its own, the fact that it had adopted the framework for other manufacturers, for example, wouldn't have precluded [00:37:03] Speaker 01: NHTSA from requiring trailer manufacturers to use that existing streamlined mechanism instead of adopting an entirely new burdensome requirement. [00:37:14] Speaker 01: Now, the fact is here, of course, there is a specific mechanism in the certificate of conformity [00:37:23] Speaker 01: requirement specific to trailers. [00:37:25] Speaker 01: And again, that's a virtue not advised. [00:37:27] Speaker 01: It actually minimizes the burden for trailer manufacturers by demonstrating that they don't have to do all of the same things that other vehicle manufacturers do. [00:37:35] Speaker 01: They just have to use the formula that's based on the model, the GEM model. [00:37:40] Speaker 01: But all of this is to say, just to go back to Judge Walker's question, that this court might or it might not conclude that the compliance mechanism in the EPA regulations is precluded by the Clean Air Act. [00:37:57] Speaker 01: If it does, then that wipes out the need to obtain a certificate of conformity to comply with NHTSA's fuel efficiency regulations. [00:38:05] Speaker 01: The other requirements of compliance would remain. [00:38:08] Speaker 01: If it doesn't, then that leaves to the agencies the available opportunities to specify the least burdensome, most consistent mechanisms for compliance with NHTSA's regulation. [00:38:20] Speaker 03: Judge Walker, if I may turn to- Very briefly, Mr. Byron, standards and testing, can you, as briefly as you can, explain how EPA standards and EPA testing can still continue if the EPA [00:38:33] Speaker 03: EPA standards and EPA testing with regard to trailers can still continue even if EPA does not have the authority to regulate trailers? [00:38:43] Speaker 01: Sure, Judge Walker. [00:38:44] Speaker 01: And standards are easy. [00:38:45] Speaker 01: And I'll just step back and remind the court that both Delta Construction and Massachusetts Against EPA recognize that there is a scientific relationship between CO2 emissions and fuel consumption. [00:38:57] Speaker 01: So that the fact that the formula measuring fuel efficiency and [00:39:03] Speaker 01: CO2 emissions is the same, is just a reflection of that scientific relationship. [00:39:09] Speaker 01: It's not a reliance on any EPA regulatory authority. [00:39:13] Speaker 01: And looking back as well in the context of the CAFE regulations that we were discussing earlier, EPA measures [00:39:21] Speaker 01: cafe fuel economy compliance by measuring CO2 emissions from vehicles. [00:39:27] Speaker 01: That's how, in order to determine compliance with NHTSA's cafe regulation. [00:39:32] Speaker 01: So historically, that's how cafe fuel economy has always been measured for compliance purposes. [00:39:39] Speaker 01: So then with respect to testing, your honor, the question of testing, and this is just, again, the auditing function that applies to, I believe all vehicles, sorry, at least all heavy duty vehicles in this context, [00:39:51] Speaker 01: The fact that NHTSA has adopted a mechanism that reduces the burden by relying principally or initially on EPA's testing mechanisms that are in place, again, with respect to the broader industry. [00:40:09] Speaker 01: is a virtue, not a vice. [00:40:11] Speaker 01: And the question whether there might be some other way for NHTSA in the event it determines it needs to audit or test a particular vehicle or a particular technology is not something that requires this court to strike down the standards themselves. [00:40:28] Speaker 01: There's no substantial doubt that NHTSA would have adopted the standards, irrespective of whether it could have relied on EPA's testing mechanism. [00:40:39] Speaker 01: I hope that answers the three questions you had Judge Walker. [00:40:43] Speaker 01: I would just urge Judge Garland, if I may turn to a question that you raised in Petitioner's argument briefly, the question whether the function test in the severability inquiry [00:40:57] Speaker 01: is meaningfully different from the intent test. [00:41:00] Speaker 01: I think that a fair reading of the Maryland DC Delaware broadcasters case makes clear that it's not genuinely independent. [00:41:09] Speaker 01: And it's true, of course, that the court in that case italicized the word and when it linked the two inquiries. [00:41:16] Speaker 01: But then when it applied the function test, it did so in the context of assessing the agency's underlying intent. [00:41:24] Speaker 01: and emphasized, if I may, that option A [00:41:32] Speaker 01: would not have been sufficient to achieve the commission's goals and, in fact, would undercut the whole structure of the rule. [00:41:39] Speaker 01: Those references to goals and undercutting the structure seems to me turn as much on intent as on anything separate from intent. [00:41:51] Speaker 01: In other words, it seemed that the court there merely [00:41:56] Speaker 01: disbelieved, if I may, the court's severability expression of intent when it itself analyzed the rules. [00:42:03] Speaker 01: And doing so here, the court can confirm readily that each agency has independent authority, exercised that independent authority, and validly expressed its intent that each set of standards can stand on its own independence. [00:42:22] Speaker 05: I just ask a question. [00:42:23] Speaker 05: Do you then concede that when you're talking about two separate regulatory systems, the analysis is severability, as opposed to simply determining whether the, if one were to fall and one were to stand, whether the standing one's provisions that refer to the other are arbitrary and capricious or something? [00:42:47] Speaker 05: I'm just not aware of severability. [00:42:49] Speaker 05: being used in this context. [00:42:54] Speaker 01: The petitioners here framed this in terms of severability, so our brief did so as well. [00:42:57] Speaker 01: In response, no party has briefed as far as I can tell whether the arbitrary and capricious standard would apply, and there's no argument that the NHTSA standards would be arbitrary and capricious on their own. [00:43:13] Speaker 05: Well, I'm talking about the regulatory provisions and cross-reference EPA. [00:43:17] Speaker 05: I understand. [00:43:18] Speaker 05: You've made some arguments as to why it would still make sense. [00:43:22] Speaker 05: I'm just trying to figure out whether, do you agree we should be using the severability lens here or simply looking at regulations cross-references and figuring out what to do with that? [00:43:38] Speaker 01: So I think that there are good reasons to look at this through the lens of severability. [00:43:43] Speaker 01: And those reasons include the fact that the preamble was jointly prepared by both agencies together, that they intended to create a harmonized set of regulatory requirements for a single industry here in order to reduce the burden. [00:44:03] Speaker 05: And that EPA regulations come into effect three years earlier than it was? [00:44:08] Speaker 01: And that's because each statute provides different lead time requirements, of course, and the agencies have independent authority that they exercise. [00:44:18] Speaker 01: Judge Mulder, I don't want to preclude the possibility, as you suggest, that the court need not adopt a severability analysis. [00:44:24] Speaker 05: But you need to tell me where the government's positioned it, right? [00:44:26] Speaker 05: If the government agrees that severability is not arguing otherwise. [00:44:30] Speaker 05: And I don't know why we would spontaneously take on the issue ourselves. [00:44:36] Speaker 01: Well, not only I think, Your Honor, is it correct that you need not spontaneously take on the issues yourselves, but also because petitioner has not argued that the remaining NHTSA fuel efficiency regulations would be arbitrary and capricious merely by referring to EPA's regulations. [00:44:54] Speaker 01: I think they have waived that argument. [00:44:56] Speaker 01: And so it need not be addressed by the court in this context. [00:45:00] Speaker 08: All right, thanks. [00:45:01] Speaker 01: For those reasons, Your Honor, we'd urge the court to deny the petition for review. [00:45:05] Speaker 01: Thank you. [00:45:06] Speaker 07: Thank you, Mr. Byron. [00:45:07] Speaker 07: Mrs. Henderson. [00:45:12] Speaker 07: For the respondent. [00:45:12] Speaker 00: Thank you, Your Honor. [00:45:13] Speaker 00: And may it please the court, Alice Henderson for the respondent interveners. [00:45:17] Speaker 00: I'd like to briefly address two of the issues related to EPA's authority that have been discussed and then turn to the joint compliance regulations. [00:45:29] Speaker 00: I noted Judge Millett that you made a note of the authority that EPA would have to set a tractor standard that would be at a level that would require trailer improvements. [00:45:42] Speaker 00: And I wanted to note that the reason EPA [00:45:46] Speaker 00: structured the regulations the way it did here with obligations for both the tractor manufacturers and the trailer manufacturers is because of the way the industry has segmented itself. [00:45:55] Speaker 00: So the tractor manufacturer never comes into possession of a trailer. [00:45:59] Speaker 00: And that's why it's necessary to achieve emissions reductions from the whole vehicle to create obligations for both manufacturers. [00:46:08] Speaker 00: And TTMA doesn't deny that if a single manufacturer [00:46:13] Speaker 00: was in charge of building both the trailer and the tractor that that whole vehicle could then be subject to an EPA standard. [00:46:20] Speaker 00: But the Clean Air Act isn't written to allow manufacturers to decide which aspects of a vehicle could be subject to a motor vehicle regulation by splitting up the production among different entities. [00:46:33] Speaker 00: And I note that council for TTMA made the point that it wouldn't make sense under the Clean Air Act to require a trailer manufacturer to warrant that its vehicle would not cause the motor vehicle to be in noncompliance with an emission standard. [00:46:51] Speaker 00: This just proves that it doesn't make sense to treat a trailer as a part. [00:46:55] Speaker 00: It is fully one half of this very large motor vehicle, the largest motor vehicle on our highways. [00:47:02] Speaker 00: And the fact that the act isn't written in a way that would allow treatment of the trailer as a part just goes to show that it must be regulated the way that EPA has reasonably done so here. [00:47:13] Speaker 00: Because otherwise, you'd have to assume that Congress intended to create a really large gap in the regulatory structure. [00:47:22] Speaker 00: And it's implausible to think that [00:47:26] Speaker 00: Congress would want to regulate other heavy duty vehicles that have cargo sections like UPS delivery trucks, but not the cargo section of a tractor trailer, which serves the same purpose, but at a much larger scale and with greater resulting emissions. [00:47:41] Speaker 02: Is that argument, Ms. [00:47:43] Speaker 02: Henderson, a little bit different than the government's argument? [00:47:46] Speaker 02: I take the government to say, and I'm on page 12 of the red brief, [00:47:50] Speaker 03: Congress did not address the question whether the agency could regulate trailers. [00:47:56] Speaker 03: You seem to be saying that Congress wanted the agency to regulate trailers. [00:48:04] Speaker 00: Our position is that EPA's determination that the tractor trailer is a motor vehicle is a permissible interpretation of ambiguity in the statute. [00:48:14] Speaker 03: Well see now there you sound sound more like the government that [00:48:18] Speaker 03: Congress really didn't make a choice on whether EPA and perhaps even NHTSA, actually it's NHTSA here too, should regulate trailers. [00:48:31] Speaker 03: Is that your position? [00:48:33] Speaker 00: No, Your Honor. [00:48:34] Speaker 00: These are two separate rules that are operating under two distinct statutory authorities. [00:48:39] Speaker 00: Our position is that NHTSA has effectuated the unambiguous intent of ESA. [00:48:45] Speaker 00: and should be upheld at step one of Chevron and that EPA has permissibly interpreted ambiguity with regard to the meaning of motor vehicle in Clean Air Act. [00:48:57] Speaker 00: I'd like to address the issue related to the compliance regulations. [00:49:02] Speaker 00: ESA creates authority for EPA to promulgate the regulations that it has here. [00:49:12] Speaker 00: And the authority that EPA has under ESA is completely separate from the authority that EPA has under the Clean Air Act to set an emission standard. [00:49:23] Speaker 00: And so all of the regulations that are necessary for a manufacturer to comply with a fuel economy standard [00:49:32] Speaker 00: can be upheld under EPA's ESA authority. [00:49:37] Speaker 00: So if the court finds that- I'm sorry. [00:49:42] Speaker 07: It's hard to interrupt with the lag. [00:49:47] Speaker 07: Could you cite the statutory provision in ESA that you're referring to? [00:49:51] Speaker 00: Sure. [00:49:52] Speaker 00: So 32904 of ESA [00:49:56] Speaker 00: directs the EPA to calculate average fuel economy for a manufacturer subject to a standard under 32902B of the act. [00:50:10] Speaker 00: And the state intervenors lay out the statutory structure in their brief. [00:50:19] Speaker 00: And 32907 and 32910 of EPCA, I'm sorry, [00:50:25] Speaker 00: Energy Policy and Conservation Act as amended by ESA also clearly contemplates a central role for EPA in facilitating implementation of fuel economy standards. [00:50:37] Speaker 00: And this is true of [00:50:39] Speaker 00: all of the vehicles that are covered under this rule. [00:50:43] Speaker 07: Just pause for a moment. [00:50:45] Speaker 07: I may not have all the necessary statutory provisions in front of me, but 32904 says EPA shall calculate the average fuel economy of a manufacturer subject to which of the provisions that follow. [00:51:02] Speaker 07: What's the definition of manufacturer for purposes of that of that section? [00:51:11] Speaker 00: So that 32904, which references manufacturers subject to a standard under 32902B unambiguously includes manufacturers subject to a heavy duty standard under 32902B1C. [00:51:31] Speaker 00: And that's what the state intervenors argued in their brief. [00:51:36] Speaker 07: Okay, thank you. [00:51:38] Speaker 00: Sure. [00:51:39] Speaker 00: And so just going back to the functionality of the compliance regulations, if this court were to find that EPA lacks Clean Air Act authority, the remedy for that finding would not be to invalidate all of the regulations that could be upheld under EPA's ESA authority. [00:52:00] Speaker 00: And everything that a manufacturer would need to comply with a fuel economy standard is [00:52:07] Speaker 00: is written in those regulations that EPA has clear authority to promulgate under ESA. [00:52:13] Speaker 02: Ms. [00:52:13] Speaker 03: Henderson, could your argument with regard to the role of EPA under ESA cut against you? [00:52:20] Speaker 03: And here's why I'm wondering that. [00:52:24] Speaker 03: If ESA imagines a regulatory role for EPA, and if the EPA doesn't have authority under the Clean Air Act to regulate trailers, [00:52:36] Speaker 03: then it seems like maybe we should interpret ESA to not cover trailers. [00:52:43] Speaker 00: I wouldn't say that's true, Your Honor. [00:52:45] Speaker 00: These are two separate and distinct statutes that serve completely different purposes. [00:52:50] Speaker 00: And this court in Delta construction recognized that when it held that even if an EPA standard were vacated, the NHTSA standard would remain because it was a separate action with independent legal effect. [00:53:03] Speaker 00: And maybe just to clarify, EPA doesn't have authority to set an emission standard under ESA, but ESA contemplates a really central role for EPA in aiding in the implementation of a fuel economy standard. [00:53:16] Speaker 00: And that's because of the expertise that EPA has in testing. [00:53:20] Speaker 00: And that relation, that role for EPA has been understood under the Energy Policy and Conservation Act, as well as ESA, which amended it. [00:53:31] Speaker 05: And 32904C also says that to the extent practicable, fuel economy tests should be carried out with emissions tests under the Clean Air Act. [00:53:43] Speaker 05: I'm trying to figure out how that intersects with the ability of NHTSA regulations to rely on EPA to do some of the measuring and certifying here. [00:53:58] Speaker 05: Does it help or hurt because they're no longer going to be doing if they were no longer hypothetically doing emissions tests for trailers? [00:54:05] Speaker 05: Would this support or not support that cross reference to having them do the measurements and calculations for NHTSA? [00:54:15] Speaker 00: I think it supports the position that EPA has clear authority to promulgate the regulations that it has to facilitate implementation of fuel economy standards. [00:54:26] Speaker 00: As you noted, it's to the extent possible to align those with emission standards. [00:54:31] Speaker 00: And if there aren't comparable trailer greenhouse gas emission standards in place, that wouldn't affect EPA's authority or ability [00:54:40] Speaker 00: you know, execute its regulations that it has promulgated for this rule. [00:54:47] Speaker 00: And I guess I'll just note on that point as well that the compliance process regulations that we're talking about here are written as instructions to manufacturers about how to generate the input values for a formula. [00:55:06] Speaker 00: And then that formula spits out a number and manufacturers are able to compare that number to, that's a CO2 level and compare that number to the actual substantive numerical EPA emission standards. [00:55:21] Speaker 00: So in no way are these regulations dependent on the existence of an emission standard. [00:55:27] Speaker 00: They're drafted to facilitate both the compliance with emission standards and fuel economy standards. [00:55:35] Speaker 00: but they aren't intertwined with the substantive emission standard. [00:55:39] Speaker 03: I don't pretend to understand the, to be able to do the math that is in the formula. [00:55:47] Speaker 03: But I imagine that there's some part of the formula that is a variable based on the particular manufacturer. [00:55:57] Speaker 03: And there's some part of that variable that is a number chosen by EPA, maybe [00:56:03] Speaker 03: maybe the denominator is a number chosen by EPA, maybe it's an, I don't know where it is in formula. [00:56:10] Speaker 03: But if EPA is choosing at least some of the numbers that go into that formula, not a formula that's all variables, but some of the numbers that go into that formula, [00:56:23] Speaker 03: I think that's, I think that's different than just saying, well, there's a formula with nothing but X, Y, and Z's and MITSA can take that mathematical formula and decide what should be Y, what should be Z and we'll make X the, the information we get from the manufacturer. [00:56:39] Speaker 03: Aren't those two different things? [00:56:40] Speaker 03: And which, which one are we talking about here? [00:56:42] Speaker 00: That's a great question. [00:56:44] Speaker 00: And the, I think the best way to answer it is to say that the regulations as you, as you correctly note, include [00:56:52] Speaker 00: Values that a manufacturer has to generate by their own testing, as well as values that are coefficients that are plugged into the formula. [00:57:01] Speaker 00: And neither of those values requires EPA to do anything other than review the application that manufacturers submit. [00:57:14] Speaker 00: Coefficients, the values that EPA has created, as you mentioned, are static, and they're already written into the regulations. [00:57:21] Speaker 00: So there's nothing new being created when a manufacturer is seeking confirmation of its compliance with a standard. [00:57:29] Speaker 03: But if I heard there in the middle, it is EPA that's picking the coefficients, not NHTSA. [00:57:35] Speaker 00: So the coefficients are written into these compliance regulations and housed under Title 40. [00:57:43] Speaker 00: They support both EPA's emission standards and NHTSA's fuel economy standards. [00:57:50] Speaker 03: So are you saying Congress picked the coefficients or EPA picked the coefficients or something else? [00:57:56] Speaker 00: Well, this is a joint rulemaking between EPA and NHTSA, so I can't tell you all of the process that led to the development of those numbers, but I think it'd be fair to say that the agencies developed them together. [00:58:09] Speaker 06: Thanks. [00:58:14] Speaker 00: I see I'm out of time. [00:58:15] Speaker 00: Thank you. [00:58:18] Speaker 00: In closing, I'll just note that these are, the largest freight trailers are the largest segment of the largest vehicle on our roads. [00:58:27] Speaker 00: They contribute substantially both to the air pollution and the fuel consumption that Congress designed these statutes to reduce. [00:58:35] Speaker 00: And I would urge the court to uphold both agency standards. [00:58:40] Speaker 07: Thank you, Ms. [00:58:40] Speaker 07: Henderson. [00:58:41] Speaker 07: Ms. [00:58:42] Speaker 07: Theodore, we're out of time, but as we generally do, we'll give you two minutes for rebuttal. [00:58:46] Speaker 06: Thank you. [00:58:47] Speaker 06: A couple of quick points. [00:58:48] Speaker 06: So first of all, on this notion that there's some sort of gap here, the Clean Air Act has been around since 1965, and trailers haven't been regulated at all during that entire time. [00:58:57] Speaker 06: So it's completely possible that Congress did not intend the regulation of trailers. [00:59:01] Speaker 06: On the EPA rules, I heard no response from respondent or intervenors on what the word self-propelled could possibly be doing in this statute if it wasn't intended to exclude trailers, which also means that EPA can't get around that by claiming it's regulating tractor trailers. [00:59:18] Speaker 06: And the notion that a tractor without a trailer is not a vehicle, as I heard Mr. Byron say, doesn't make any sense. [00:59:25] Speaker 06: EPA has been regulating tractors by themselves for years, including in the phase one standards. [00:59:31] Speaker 06: So let me turn to the argument that the ESA gives EPA authority to do this is just completely wrong. [00:59:39] Speaker 06: So section 32904 [00:59:41] Speaker 06: only authorizes regulation of manufacturers. [00:59:44] Speaker 06: Manufacturers is defined in section 329014 to mean a person engaged in manufacturing automobiles and section 329013 defines an automobile as something that's less than 10,000 gross vehicle weight. [00:59:58] Speaker 06: um meaning not a heavy duty vehicle and that's because 32904 actually isn't part of the ESA it was added in 1994 when NHTSA only had authority to regulate light duty vehicles and if you look at the government's uh stay opposition they they admit that this provision 32904 does not authorize the regulation of trailers even under their theory that a trailer is a vehicle. [01:00:19] Speaker 05: 32904 just says a manufacturer subject to section 32902 [01:00:28] Speaker 05: It seems to me that's just the question is, if trailers are included in the ESA definition of motor vehicle, then they are a manufacturer subject to 32902B. [01:00:43] Speaker 05: and therefore covered by 32904. [01:00:46] Speaker 05: Am I wrong? [01:00:47] Speaker 06: I don't think so, Yara, because they're not a manufacturer. [01:00:50] Speaker 06: Manufacturer is defined in the statute, and it's defined to mean someone who manufactures automobiles, which is defined to exclude heavy duty vehicles. [01:00:59] Speaker 05: Well, then why would they refer to 32902B through D, which includes then both automobiles and [01:01:09] Speaker 05: heavy truck vehicles and things like that. [01:01:12] Speaker 06: It's because 32904 was enacted in 1994 before that other provision was amended. [01:01:18] Speaker 06: And it's just a cross reference to be when B was different before the ESA was enacted. [01:01:24] Speaker 06: But in any event, I mean, the EPA doesn't rely on ESA. [01:01:27] Speaker 06: So it doesn't really matter. [01:01:28] Speaker 06: Because what matters is what the EPA actually claims regulatory authority under. [01:01:33] Speaker 06: And at Jade 238, they make clear that they're only relying on the Clean Air Act. [01:01:39] Speaker 06: So turning to the separability analysis very quickly, the question is not whether every provision of NHTSA's rules couldn't function. [01:01:50] Speaker 06: It's whether striking EPAs would impair the function of NHTSA's rules. [01:01:56] Speaker 06: It's very clear that it would. [01:01:57] Speaker 06: And I heard no explanation of how a manufacturer could possibly determine whether they comply if they can't get someone to tell them that their trailers comply. [01:02:06] Speaker 06: But also, I mean, the testing regulations. [01:02:09] Speaker 06: Trailer manufacturers, they can't simply plug numbers into the equation. [01:02:14] Speaker 06: They have to do tests. [01:02:16] Speaker 06: And the regulations make very clear that EPA has to pre-approve those tests. [01:02:21] Speaker 06: And so in the absence of EPA acting to pre-approve those tests, you can't even figure out whether you comply with the regulations in the first place, even putting aside the absence of the certificate of conformity. [01:02:32] Speaker 06: In response to the question whether severability is the right analysis, I certainly think the United States has waived any argument that it's not. [01:02:43] Speaker 06: And again, the Delta case from this court, it applied a severability analysis to a joint EPA NHTSA rule. [01:02:48] Speaker 05: We're talking about them being bifurcated. [01:02:50] Speaker 05: I don't know if that's all it is to talk about them being bifurcated. [01:02:55] Speaker 06: So the Delta case is a case that said that the petitioners didn't have standing because [01:03:00] Speaker 06: because they only challenged the EPA portion of the rule and there was no addressability because the NHTSA portion of the rule would stand in the absence of the EPA portion of the rule. [01:03:11] Speaker 06: And the court said the question in deciding whether that was so was whether NHTSA's provisions were dependent on EPA's. [01:03:18] Speaker 06: So that's the same question that we're addressing here. [01:03:21] Speaker 06: Dependent is not the same thing as... [01:03:24] Speaker 05: severable. [01:03:25] Speaker 05: They could very well be whether they can operate in a non-arbitrary way without cross-references, given the cross-references. [01:03:33] Speaker 05: That's all I'm struggling with. [01:03:35] Speaker 05: I guess I didn't see, they talked about whether the field economy standards cannot be bifurcated from the greenhouse gas emission standards, but it wasn't clear to me that that was a severability analysis as opposed to [01:03:50] Speaker 06: You know, Your Honor, however you want, whatever you want to call it, I think it's the same functional analysis. [01:03:55] Speaker 06: The question is whether the NHTSA rules can operate as law without the operation of the EPAs. [01:04:03] Speaker 06: And you could call it a severability analysis, you could call it an arbitrary and capricious analysis, which we certainly haven't waived since we argued that the NHTSA rules were non-functional and made no sense without the EPAs. [01:04:13] Speaker 06: So I think the court can call it whatever it wants to call it. [01:04:16] Speaker 06: But the question is really the same. [01:04:18] Speaker 06: You're looking at the rule, and you're looking at what the scope of the remedy is and what you have to vacate. [01:04:23] Speaker 06: And you can't leave MITS' provisions if they make zero sense without the EPAs, which they do make zero sense. [01:04:32] Speaker 06: And again, that's the world we're living in right now. [01:04:38] Speaker 07: Are there further questions from the bench? [01:04:40] Speaker 05: Is 32904C, is that limited to cars? [01:04:46] Speaker 05: Or would that also apply to covered heavy vehicles? [01:04:52] Speaker 06: Let me just pull out 32904C, I'm sorry. [01:05:03] Speaker 05: It talks about each model, so I'm not sure if that means cars or not. [01:05:20] Speaker 06: Yes, so 3204C also refers to a quote unquote manufacturer. [01:05:24] Speaker 06: Manufacturer is defined in statute with reference exclusively to non-heavy duty vehicles. [01:05:31] Speaker 06: OK, thank you. [01:05:34] Speaker 07: All right, we'll take the matter. [01:05:36] Speaker 07: You have something more? [01:05:37] Speaker 06: I would just close by asking the court to act swiftly on the stay because it really is creating an enormous problem for trailer manufacturers right now that they can't take orders while assuring their customers that they can actually sell those trailers in 2020. [01:05:51] Speaker 03: Can I ask one very quick question on the stay thing? [01:05:54] Speaker 03: It seems like [01:05:55] Speaker 03: the harm has the harm already been done the irreparable harm i mean you you all have to start preparing for january 1st as if this rule is going to be in effect and i suspect you can't start doing that tomorrow september 16th absolutely your honor yes i mean there is irreparable harm going on right now every every day and that's why we would ask the court to act as swiftly as i can on on this but there's some irreparable harm that has not yet [01:06:20] Speaker 06: Well, for example, if a trailer manufacturer could take an order tomorrow, that would be very helpful. [01:06:28] Speaker 06: And if the court's regulations, then a trailer manufacturer could do that and could offer a trailer per sale in 2021. [01:06:35] Speaker 05: When did the irreparable harm start? [01:06:38] Speaker 05: I'm sorry? [01:06:38] Speaker 05: When did the irreparable harm start? [01:06:41] Speaker 06: It's been ongoing. [01:06:41] Speaker 06: It depends on each trailer manufacturer, because they sort of had different- Give me a rough estimate. [01:06:48] Speaker 06: in the last month or so. [01:06:50] Speaker 06: I mean, trailer manufacturers are starting to take orders right now. [01:06:53] Speaker 06: There's like a three or four month lead time. [01:06:56] Speaker 07: Okay, thanks. [01:06:58] Speaker 07: Given the stay on EPA, what have the trailer manufacturers been doing with respect to compliance? [01:07:05] Speaker 06: So the trailer manufacturers have asked EPA if EPA is going to issue certificates of conformity. [01:07:11] Speaker 06: EPA said no. [01:07:12] Speaker 06: The trailer manufacturers have asked EPA if there's anyone in NHTSA they can talk to. [01:07:15] Speaker 06: EPA said it has no idea. [01:07:17] Speaker 06: So the trailer manufacturers are sort of just planning for trying to think about building warehouses to store this equipment and potentially to comply even in the absence of a certificate of conformity. [01:07:29] Speaker 06: But basically, it's impossible. [01:07:30] Speaker 05: I mean, that's what we talked to NHTSA about. [01:07:33] Speaker 05: You said they've talked to EPA. [01:07:34] Speaker 05: Have they talked to NHTSA about what to do? [01:07:37] Speaker 06: There's no one at NHTSA who will talk to them about what to do. [01:07:42] Speaker 06: The trailer manufacturers have asked, and this is in the declarations, they've asked the EPA who at NHTSA will implement this, and EPA says they have no idea. [01:07:52] Speaker 07: OK, barring further questions then, we'll take the matter under submission. [01:07:56] Speaker 07: Thank you, and the Corps will take a brief recess. [01:07:59] Speaker 04: Thank you.