Federal Civil Procedure - Standing - D.C. Circuit Raises Prudential Standing Sua Sponte to Dismiss Regulatory: Challenge on Jurisdictional Grounds

Article excerpt

Plaintiffs challenging a regulatory action generally must demonstrate two kinds of standing: constitutional and prudential. Constitutional standing requires that a plaintiff present a case or controversy within the court's Article III jurisdiction, (1) while prudential standing encompasses judicial considerations beyond that constitutional minimum. (2) Recently, in Grocery Manufacturers Ass'n v. EPA, (3) a divided D.C. Circuit panel rejected, on standing grounds, a challenge to the Environmental Protection Agency's (EPA's) grant of a partial waiver allowing fuel providers to introduce a new fuel into the American market. Although the EPA had not challenged plaintiffs' standing, the court reasoned that it had an "independent obligation" to consider standing (4) and that this mandatory analysis included both constitutional and prudential standing. (5) This case extends splits both within the D.C. Circuit and across other circuits as to whether prudential standing is a mandatory jurisdictional question. The D.C. Circuit or the Supreme Court should clarify this jurisprudence by adopting a separation of powers-focused approach under which courts assess whether an executive branch decision not to challenge a plaintiff's standing furthers the proper functioning of the three branches.

The Energy Policy Act of 2005 (6) directs the EPA to promulgate regulations requiring that fuel suppliers meet escalating annual targets for the amount of renewable fuel they introduce into the American market. (7) In effect, the law requires suppliers to develop new, more renewable fuels. (8) But under the Clean Air Act, (9) suppliers introducing a substantially new fuel must obtain a waiver from the EPA affirming the fuel's compatibility with vehicles already on the road. (10)

In March 2009, an ethanol industry association applied for such a waiver for a new ethanol-blend fuel. (11) The EPA took the novel approach of granting partial waivers, allowing the distribution of this fuel for use only in "light-duty motor vehicles" of model years 2001 and later. (12) Three affected industry associations petitioned the D.C. Circuit for review of the decision to grant partial waivers. (13)

The D.C. Circuit, hearing the case on direct review, dismissed the petitions. (14) Writing for a divided panel, Chief Judge Sentelle (15) held that no association had standing to challenge the EPA's partial waivers and dismissed for lack of jurisdiction. (16) Although the EPA had not challenged petitioners' standing, (17) Chief Judge Sentelle explained that courts have an "independent obligation to be sure of [their] jurisdiction" under Article III. (18)

Chief Judge Sentelle held that two petitioners (the engine manufacturers and the petroleum suppliers) failed the constitutional standing test, (19) which requires that a petitioner have suffered an "injury in fact" that is "fairly traceable" to the agency action, and that a favorable decision would be "likely" to remedy petitioner's injury. (20) He would have also held that the third association (the food producers) did not have constitutional standing, (21) but lacking a two-judge majority on this point, (22) he turned to prudential standing.

Applying the "zone of interests" test, Chief Judge Sentelle held that the food producers lacked prudential standing. (23) Under this test, the interest the petitioner seeks to protect through litigation must be "arguably within the zone of interests to be protected or regulated by the statute." (24) The food producers sought to protect the price of corn, which could rise significantly with increased production of ethanol, a corn-based fuel. (25) While the Energy Policy Act (the statute setting fuel targets) did require the EPA to consider "food prices" when setting renewable-fuel-volume requirements, (26) Chief Judge Sentelle concluded that the Energy Policy Act was not the statute at issue. (27) Rather, the challenge concerned the EPA's authority to waive the restrictions on new fuel under the Clean Air Act, (28) which does not identify the price of food as an interest to be protected. …