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“Vacation” at the Farm: Why Courts Should Not Extend “Remand Without Vacation” to Environmental Deregulation

Posted By Benjamin W. Tettlebaum On December 31, 2012 @ 1:01 am In Administrative Law, Cornell Law Review, Environmental & Urban Law, Law Review Note | No Comments

The U.S. Supreme Court has recently made permanent injunctive relief harder to obtain. In Monsanto Co. v. Geertson Seed Farms, the Court reversed a nationwide injunction that prohibited the planting of Monsanto’s genetically modified (GM) Roundup Ready Alfalfa.1 The Court reaffirmed its holding from Winter v. Natural Resources Defense Council, Inc. and eBay Inc. v. MercExchange, L.L.C. that obtaining permanent injunctive relief requires surmounting a four-factor test.2 But the Court left in place the district court’s order vacating the U.S. Department of Agriculture’s (USDA’s) deregulation of the GM alfalfa seed. Environmental groups claimed victory because the district court’s vacation order returned the seed to its regulated state, effectively prohibiting planting. Geertson was a watershed case—the first Supreme Court opinion to consider the potential impacts of agricultural biotechnology.

By raising the bar for injunctive relief, the Geertson Court has incentivized parties, and thus courts, to focus more squarely on vacation for allegedly improper agency action, particularly in environmental deregulation cases. Courts may respond by employing the legally questionable but increasingly utilized judicial remedy of remand without vacation (RWV). The D.C. Circuit Court of Appeals has enunciated a two-part test to determine when RWV is proper. If the consequences of vacation are so disruptive or the flaw in the agency action is so minimal, then a court may leave the defective agency action in place on remand.

This Note argues that, whether or not RWV is lawful, the device is an improper remedy for invalidated environmental deregulation. Indeed, the reasons courts give for using RWV in

cases of defective environmental regulation demonstrate precisely why courts should not use RWV in cases involving defective environmental deregulation.

SETTING THE STAGE FOR HEIGHTENED FOCUS ON VACATION REQUESTS IN ENVIRONMENTAL DEREGULATORY CASES

GM seeds purportedly create a number of risks. As farmers douse crops with greater amounts of herbicide, weeds become increasingly resistant, giving rise to “superweeds.” In turn, farmers escalate the battle and spray more potent herbicides. Also, GM seed can pollinate farmers’ non-GM crops. Because seed manufacturers patent their GM seeds, if they discover their seeds growing on a farm that has not purchased the product, they may bring suit against the farmer. Further, some domestic markets refuse to purchase GM food and some countries prohibit its importation.

The Plant Protection Act gives the USDA the power to regulate “plant pests.”3 The Animal and Plant Health Inspection Service (APHIS), part of the USDA, has promulgated regulations under which “certain genetically engineered plants are presumed to be ‘plant pests’—and thus ‘regulated articles.’”4 Because a GM seed is a regulated article, a grower cannot plant the seed without a permit.

However, anyone may petition APHIS to deregulate a given seed. If APHIS attempts to deregulate a genetically modified organism (GMO), other federal environmental laws are implicated. For example, the agency might need to conduct an endangered-species analysis under the Endangered Species Act. Similarly, the National Environmental Policy Act (NEPA) demands that, before deregulation can occur, APHIS must produce an environmental impact statement (EIS), which assesses the potential environmental and health impacts of deregulating the GM seed.5

In 2004, Monsanto petitioned APHIS to deregulate its Roundup Ready Alfalfa, the first crop genetically engineered to resist an herbicide—Monsanto’s Roundup weed killer—and to allow it to “transmit the genetically engineered gene to other plants.” The following year, APHIS agreed to deregulate the alfalfa but decided that a full EIS was unnecessary. Conventional (non-GM) alfalfa farmers, including Geertson Seed Farms, Inc., brought suit to compel APHIS to prepare an EIS. After the district court ruled against APHIS on the merits, the court vacated the deregulation (once again turning Roundup Ready Alfalfa into a regulated article), ordered preparation of an EIS, and enjoined future planting of Roundup Ready Alfalfa pending completion of the EIS. The Ninth Circuit affirmed.

The Supreme Court considered only the propriety of injunctive relief and held that even in the context of NEPA, injunctive relief is still a “drastic and extraordinary remedy” that requires surmounting the “traditional four-factor test.” In reversing the Ninth Circuit, the Court ruled that the district court abused its discretion by prohibiting all planting of the GM alfalfa and enjoining APHIS from possibly effecting a partial deregulation. Importantly, the Court reasoned that because the district court’s vacation of APHIS’s deregulation had the same effect as the injunction—prohibiting planting—“no recourse to the additional and extraordinary relief of an injunction was warranted.”

Indeed, the vacate-and-remand order still required APHIS to complete a full EIS before determining whether it could fully deregulate the GM seed. An EIS takes on average 3.6 years but can take as long as twelve years. For pro-regulatory parties who believe that genetically engineered food poses serious risks, vacation could significantly help their cause by slowing

deregulation. On the other hand, this could have a substantial economic effect on GM seed manufacturers and farmers—the GMO industry helps produce over 90% of U.S. acres of beets, up to 45% of U.S. corn, 85% of soybeans, and an estimated 70–75% of processed foods on supermarket shelves. Geertson has thus set the stage for fierce battles over not only the merits of deregulatory cases but also the proper remedy if a court invalidates the deregulation.

HEIGHTENED FOCUS ON VACATION REQUESTS WILL PLACE PRESSURE ON COURTS TO CONSIDER REMAND WITHOUT VACATION

With increased pressure to vacate deregulatory actions, courts, prompted by seed manufacturers as parties to the litigation, will likely seek to mitigate the consequences of vacation. Historically, courts have granted RWV in environmental cases looking primarily to whether vacating the regulation at issue would be so severely disruptive that keeping the defective regulation in place would be preferable to having no regulation at all. Even if the rule cannot be cured, courts have used ad hoc balancing to determine whether RWV is proper, staving off the disruptive impact of vacation.

As agricultural biotech companies and agencies pushing deregulation face an increasing number of lawsuits requesting vacation, these parties will likely adapt their strategy to argue for RWV. Deregulatory proponents can use arguments typically made by conservation groups in environmental suits to advocate for leaving the deregulation of GM seed in place. For example, the presence of some reliance interest is essential to the granting of RWV. By the time a biotech deregulatory case reaches a court, many farmers will likely already have planted the GM seed at issue. Although vacation might affect only future planting, reregulating the seed could still significantly harm not only the farmers and companies themselves but also the intended beneficiaries of the GM crops, such as food companies, supermarkets, and general consumers of GM food.

A court would balance these interests against the seriousness of the deficiency of the environmental review (or lack thereof). This inquiry amounts to analyzing the threat that continued planting of GM crops, absent an adequate environmental review, might pose to non-GM farmers. Industry and the agency can argue that vacating the deregulation would be of little benefit—it would not vitiate the risk of cross-contamination, because the court would likely not order the destruction of GM seed already in the ground at the time of trial. Moreover, because APHIS has already deregulated a number of GM crops, the findings of an EIS would serve as a mere formality, resulting in deregulation down the road. Like other RWV cases where the agency could fix its reasoning on remand, APHIS could merely “cure” the defect.

Agricultural biotech companies that strategically reframe the consequences of vacating deregulation could bring (and have already brought) RWV within the purview of courts considering the likely onslaught of cases in this realm. Courts, however, should not extend RWV to this context. Doing so would undermine the best interests of the judiciary, the agencies, the parties, and the public.

COURTS SHOULD NOT EXTEND REMAND WITHOUT VACATION TO ENVIRONMENTAL DEREGULATORY CASES

Strong reasons militate against extending RWV to environmental deregulatory cases. Center for Food Safety v. Vilsack, the first and only case post-Geertson to consider a challenge to the deregulation of a GM crop, serves as a model for why RWV is a grossly inadequate remedy.6

Center for Food Safety involved the deregulation of Monsanto’s GM sugar beets. In 2009, the U.S. District Court for the Northern District of California ordered APHIS to conduct a full EIS on GM sugar beets. The court denied the plaintiffs’ request for a permanent injunction, citing Geertson, though it expressed concern about APHIS’s failure to prepare an EIS before deregulating the crop.

The court then applied the Allied-Signal test to determine if it should remand without vacating. It began by noting that the Ninth Circuit has issued RWV only in environmental cases, where it was concerned that vacating the existing regulation would cause irreparable environmental injury. In Center for Food Safety, however, the defendant biotech companies focused on the economic consequences. The court expressed doubt that economic harm could ever form the basis for RWV. Regardless, the defendants had failed to demonstrate that they would incur serious economic harm pending a full environmental review. The court was also concerned that defendants were not taking the process seriously, since defendants asserted that APHIS would simply find deregulation proper after the EIS. Ultimately, the court vacated APHIS’s deregulatory decision.

Center for Food Safety shows that deregulatory cases are the mirror image of the environmental cases in which courts often issue RWV orders. For example, the court in Idaho Farm Bureau Federation v. Babbitt left in place a defective regulation meant to protect an endangered snail species.7 Absent RWV, by the time the agency could promulgate a new regulation, the reason for its enactment could have been moot—the species might already have been extinct. In the deregulatory context, the opposite is true. Remanding without vacating would actually ensure that the risky environmental activity would remain unregulated. Only by vacating could the court safeguard the interests the regulation aims to protect while the agency determines whether deregulation would risk environmental degradation. Particularly in the recent agricultural biotech cases, the faulty deregulation is not merely a curable defect. Only by conducting the required EIS will the agency know the extent of the disruptive consequences of the deregulation. Just as a regulatory environmental suit presents the strongest case for a court to employ RWV, a deregulatory environmental suit presents the strongest case for a court to refrain from using RWV.

Interestingly, a deregulatory challenge under NEPA presents the most powerful case for rejecting RWV precisely because NEPA is a procedural statute. NEPA is concerned solely with informed decision making. If a court finds an EA or EIS inadequate but remands to the agency without vacating the deregulation, then no possibility exists for the agency to make a fully informed decision before taking action. The very action the EIS would be meant to evaluate—deregulation—would already have occurred. This would undermine the purpose of NEPA.

RWV is particularly harmful to the judiciary in the deregulatory context because it risks continuing the trend of administrative agencies ignoring judicial orders, or at least significantly delaying renewal of the requisite rulemaking process. Under an RWV order, agencies would have less incentive to conduct thoroughly a statutorily mandated procedure, such as an EIS. Agencies would know that a remand would be toothless—the deregulation would remain in place even if a court ordered the agency to conduct the flouted procedure.

Over time, RWV would be similarly harmful to administrative agencies implementing the erroneous deregulation. With little incentive to cure the faulty deregulation, the agency risks losing the public trust. The success of notice-and-comment rulemaking depends on the public’s perception that an agency follows all aspects of the administrative process for regulation and deregulation. Granted, interested parties would likely be more aware of whether a given agency takes account of their comments in the resulting deregulation or regulation than they would be aware of a court order. Nonetheless, those same parties who commented during the deregulatory process would also likely take note of whether an agency abides by the terms of a judicial order

requiring, for example, the agency to conduct an EIS. RWV would disincentivize an agency to conduct the EIS in a timely manner, risking erosion of the public’s confidence in the agency’s process.

Excluding RWV from environmental deregulatory cases clearly benefits parties opposing deregulation. For example, it assuages concerns that deregulation of GM seed threatens conventional or organic crops with contamination. Vacation maintains the status quo pending completion of the EIS.

The benefit to advocates of deregulation is admittedly less clear. At least in the agricultural biotech subset of environmental cases, benefits may accrue in the long term. A full EIS would allow more comprehensive study of the environmental impacts of GM crops. This could lead to additional studies concerning the human health effects of genetically engineered foods. Depending on the results, such studies could lend credibility to industry claims about the safety and utility of GM food. A consensus within the scientific community could bolster public support and, in turn, hasten the infusion of GM seed into the marketplace. The full disclosure and data produced might lead to increased exportation of such foods, enabling companies to tap into the four-billion-dollar foreign market.

Even if this long-term prospect were illusory, domestic consumers would still receive more information about the impact of genetically engineered foods. At the very least, delaying deregulation would ensure more careful consideration of potentially ill effects on conventional, organic, and wild crops.

IF A COURT APPLIES THE ALLIED-SIGNAL TEST, REMAND WITHOUT VACATION SHOULD FAIL AS THE REMEDY

The two cases that have held the deregulation of GM seed invalid have resulted in vacation. Center for Food Safety provides a ready example of why even if a court employs the Allied-Signal test, the result should be vacation. The district court in Center for Food Safety found that the environmental deregulation was invalid and that the plaintiffs demonstrated that “deregulation [might] significantly affect the environment.” The deficiency was great enough that APHIS could not, in other words, “rehabilitate its rationale for the [de]regulation” upon remand.

The deficiency prong of the Allied-Signal test weighs heavily in favor of vacation. Unlike a mere inadequate explanation, easily corrected on remand, a flawed EIS is a significant deficiency. The district court in Center for Food Safety even chastised the defendants for “not taking this process seriously” when they asserted that the EIS was merely a procedural hurdle and that APHIS would simply affirm its decision after preparing an EIS. Leaving the flawed deregulation in place could significantly affect non-GM crops in the interim.

The disruption prong also favors vacation. In Center for Food Safety, the court found that the purported economic harm cited by defendants did not warrant RWV. Agricultural biotech defendants could change their argument to show real environmental or human harm rather than purely adverse economic consequences. Still, the risk of environmental disruption for the non-GM-seed farmers would likely outweigh the potential harm to seed manufacturers waiting for completion of the EIS. Farmers would likely not have to destroy GM seed already in the ground. But non-GM farmers face ongoing risk of crop contamination if planting continues during the pendency of the EIS. This risk of disruption, due precisely to the risks the agency would be studying in the EIS, merits vacating the defective deregulatory decision.

* * *

The agricultural biotechnology industry affects a number of administrative agencies, scores of regulated industries, and millions of regulatory beneficiaries—farmers and consumers alike. As the USDA grapples with the exponential growth of complex GMOs, courts will undoubtedly continue to find themselves in the center of a deregulatory battle. Courts have their hands full simply determining whether deregulation is defective. But courts must consider (and litigants must appreciate) the likely consequences on remand of the remedy ultimately imposed. Once a court finds the deregulation invalid, it should vacate. Even if courts apply the two-part RWV test to flawed environmental deregulation, the result should be vacation—the benefits of vacation far outweigh the costs.

Acknowledgments:

Benjamin W. Tettlebaum is a 2012 graduate of Cornell Law School.

This essay is based on the note, Benjamin W. Tettlebaum, “Vacation” at the Farm: Why Courts Should Not Extend “Remand Without Vacation” to Environmental Deregulation, 97 CORNELL L. REV. 405 (2012).

Copyright © 2012 Cornell Law School.

  1. See 130 S. Ct. 2743, 2761–62 (2010).
  2. See Winter v. Natural Res. Def. Council, Inc., 555 U.S. 7, 22–24 (2008); eBay, Inc. v. MercExchange, L.L.C., 547 U.S. 388, 394 (2006) (enunciating the four-factor test in the context of permanent injunctive relief).
  3. Plant Protection Act, 7 U.S.C. § 7712 (2006).
  4. Geertson, 130 S. Ct. at 2749 (citing 7 C.F.R. §§ 340(a)(2) n.1, 340.1, 340.2, 340.6 (2010)).
  5. See National Environmental Policy Act of 1969, 42 U.S.C. § 4332(2)(C) (2006).
  6. 734 F. Supp. 2d 948, 950 (N.D. Cal. 2010).
  7. See 58 F.3d 1392, 1405 (9th Cir. 1995).

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