IGas Holdings, Inc. v. EPA

A company that produces refrigerants filed a petition for writ of certiorari in the U.S. Supreme Court seeking review of the question of whether Congress violated the Vesting Clause of Article I of the Constitution in the American Innovation and Manufacturing Act of 2020 (AIM Act) by giving an executive agency (the U.S. Environmental Protection Agency (EPA)) “unbounded discretion to choose which private parties are entitled to participate in a multibillion-dollar market” for hydrofluorocarbons (HFCs). The petition contended that the AIM Act—which requires a phasedown of HFC production and consumption—failed to provide any “intelligible principle” to guide EPA’s exercise of discretion as required by the Court’s nondelegation doctrine. The company argued that in determining that Congress had provided sufficient guidance for EPA’s exercise of discretion, the D.C. Circuit had “committed an Article III violation by reading into the Act the guidance Congress did not supply.”

A company that imports, produces, and sells refrigerants—which contended that EPA’s allocation rule gave other entities, including end-users such as the government, more than 20% of the company’s market share—argued in its rehearing petition that en banc review was warranted to consider the whether the AIM Act provided insufficient guidance to EPA in violation of the nondelegation doctrine; that the panel disregarded statutory text and interpretation principles and improperly deferred to EPA to supply “an intelligible principle that is otherwise lacking”; and that the EPA rule was at odds with the court’s interpretation of the AIM Act.

Less than two months after denying challenges to a U.S. Environmental Protection Agency (EPA) rule setting an allocation methodology for hydrofluorocarbon (HFC) allowances for 2024 through 2028 as part of the cap-and-trade program to implement the HFC phasedown required by the American Innovation and Manufacturing Act (AIM Act), the D.C. Circuit Court of Appeals denied a petition for panel rehearing or rehearing en banc filed by a company that imports, produces, and sells refrigerants. No member of the court requested a vote on the petition for rehearing en banc.

The D.C. Circuit Court of Appeals upheld a U.S. Environmental Protection Agency (EPA) rule setting an allocation methodology for hydrofluorocarbon (HFC) allowances for 2024 through 2028 as part of the cap-and-trade program to implement the HFC phasedown required by the American Innovation and Manufacturing Act (AIM Act). The court rejected a claim that the AIM Act unconstitutionally delegated legislative power to EPA, finding that “Congress provided ample direction to guide the EPA’s exercise of discretion” in deciding how to allocate the HFC allowances. The court also found that EPA used a reasonable allocation methodology.