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By Lisa M. Campbell, Timothy D. Backstrom, and James V. Aidala

On June 8, 2020, the U.S. Environmental Protection Agency (EPA) announced the issuance of an existing stocks order under Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) Section 6(a)(1) governing further sale, distribution, and use of existing stocks of three reduced volatility dicamba products (XtendiMax®, EngeniaTM, and FeXapanTM) with conditional registrations that were vacated by the June 3, 2020, decision of the Ninth Circuit Court of Appeals in National Family Farm Coalition v. EPA.  EPA explained its action by stating that the existing stocks order would provide “clarity to farmers” in light of the Court decision.  Because EPA believes that vacatur made those stocks of the three dicamba products that were already in channels of trade unregistered pesticides, and the Court’s decision did not specifically address or establish any regimen to govern these unregistered existing stocks, EPA concluded that issuance of an existing stocks order was a practical necessity.  The existing stocks order includes provisions that:  (1) prohibit all sale and distribution of existing stocks of the three vacated dicamba products by the registrants, and by persons other than commercial applicators except for disposal of the products or returning the products to the registrants or their contract agents, (2) allow commercial applicators to use existing stocks of the vacated dicamba products in their possession in a manner consistent with existing labeling until July 31, 2020, and (3) prohibit end users from using existing stocks of the vacated dicamba products in their possession except in a manner consistent with existing labeling and from using such stocks in any manner after July 31, 2020.

Need for an Existing Stocks Order

To understand EPA’s position concerning the need for an existing stocks order for the three dicamba products with registrations vacated by the Ninth Circuit decision, it is important to review the legal status of those existing stocks after issuance of the decision.  In the absence of further EPA action, all stocks of the three dicamba products subject to the vacatur order that were already in channels of trade became unregistered pesticides.  Under FIFRA, as unregistered pesticides, these products could not be distributed or sold, which would prohibit stock of the unregistered products from being returned to the registrants or disposed, absent further EPA action.  Stocks of the three products that were labeled for uses other than soybeans and cotton (the uses extended by the conditional registration decision vacated by the Court) also became unregistered and thus also could not be distributed or sold absent further action by EPA.  Without further action by EPA, stocks of the three products already in the hands of end users could be lawfully used without any kind of restriction because although FIFRA Section 3(a) prohibits sale or distribution of unregistered pesticides, FIFRA does not include any provision prohibiting or limiting use of unregistered pesticides.  Thus, the Court’s vacatur action created a situation in which EPA needed to act expeditiously to establish a rational regimen governing existing stocks of the three dicamba products.  EPA was able to issue an order creating such a regimen because EPA construes the vacatur of the product registrations by Court action as a type of cancellation, which is how EPA has construed vacatur orders in the past.  FIFRA Section 6(a)(1) expressly authorizes EPA to issue orders governing sale, distribution, and use of canceled pesticides.

EPA Policy for Existing Stocks Orders

EPA adopted a policy in 1991 (56 Fed. Reg. 29362) outlining six factors it generally considers in adopting existing stocks orders for canceled pesticides under FIFRA Section 6(a)(1):  (1) the quantity of existing stocks at each level in channels of trade, (2) the risks resulting from use of existing stocks, (3) the benefits resulting from use of existing stocks, (4) financial expenditures users and others have already spent on existing stocks, (5) the risks and costs of disposal or alternative disposition of existing stocks, and (6) the practicality of implementing restrictions on the distribution, sale, or use of existing stocks.  EPA applied this policy to the current situation and determined that “[e]ach of the six factors weighs heavily in support of allowing end users to use existing stocks of these dicamba products that are in their possession.”  Since use of these unregistered pesticides is not otherwise prohibited by FIFRA as discussed above, EPA adopted prohibitions of use of the products not in accordance with the current labeling and of any use after July 31, 2020.  The only action taken by EPA to authorize further use of the three products involved stocks held by commercial applicators, which EPA allowed the commercial applicators to use according to the current labeling until July 31, 2020.

EPA Administrator Wheeler stated, “At the height of the growing season, the Court’s decision has threatened the livelihood of our nation’s farmers and the global food supply. Today’s cancellation and existing stocks order is consistent with EPA’s standard practice following registration invalidation, and is designed to advance compliance, ensure regulatory certainty and to prevent the misuse of existing stocks.”

Three days after EPA issued the dicamba existing stocks order, on June 11, 2020, the Petitioners in the National Family Farm Coalition case submitted a motion requesting that the Court provide emergency relief “to enforce its vacatur” decision and that the Court hold EPA and Administrator Wheeler in contempt.  According to the Petitioners, EPA’s entire rationale for issuing an existing stocks order is based on false premises.  In the Petitioners’ view, existing stocks of the three dicamba products are not “unregistered” because the vacatur order only invalidated certain newly authorized uses, and the existing stocks should not be deemed to be “cancelled” either, although the conditional registration decision for the products has been vacated.  In their motion, the Petitioners also assert that EPA is wrong because, “When read in context, FIFRA clearly prohibits the use of unregistered pesticides.”  In addition to their request that the Court take emergency action to enforce its decision and hold EPA in contempt, the Petitioners also requested that the Court adjudicate their Endangered Species Act (ESA) claims, an action that would require that the Court recall the mandate and issue another decision on the ESA claims it previously declined to reach.

On June 12, 2020, the Court issued an order requiring EPA to file its response to the motion by 5:00 p.m. PDT on June 16, 2020, and the Petitioners to file any reply by 5:00 p.m. PDT on June 18, 2020.

In another development, BASF Corporation and E.I. DuPont de Nemours each filed separate “emergency motions” to intervene in the case on June 12, 2020.  Each company asserts that it was not afforded notice that the Court might take adverse action concerning the registration for its dicamba product until after the decision vacating that registration was issued by the Court.  At this juncture, the Court has not yet indicated whether it will consider these emergency intervention motions or whether it would be willing to allow any further briefing on the merits of the case.

Additional information on the Ninth Circuit Court of Appeals decision is available on our blog.

Commentary

The Court’s June 3, 2020, decision stated, “We are aware of the practical effects of our decision,” but it is not clear from the discussion that follows whether the Court fully considered the chaotic effects of issuing a vacatur decision that did not specifically address the fate of existing stocks of the dicamba products with vacated registrations.  On May 21, 2020, EPA asked for leave to file information on its plans to issue a cancellation order governing existing stocks of products with vacated registrations, but the Court declined to allow that filing.  In any case, it should not have been surprising that EPA would construe its vacatur order as a form of cancellation, because that is what EPA did when the Ninth Circuit previously issued a vacatur order for sulfoxaflor products in 2015.

The Petitioners’ motion rejecting the basic legal premises underlying the EPA existing stocks order reflects a novel view of pesticide registration that is difficult to reconcile with the plain language and established constructions of FIFRA.  Under FIFRA, EPA issues registrations for specific pesticide products, which may be labeled only for those uses that EPA has previously determined meet applicable requirements.  Under FIFRA Section 6(b), EPA can decide that particular uses no longer meet the standard for registration and must be removed from an existing product label, but the only means by which EPA can effectuate that determination is by taking action to cancel any product for which the registrant does not agree to make the necessary changes.  The Court vacated EPA’s conditional registration decision that authorized three registered dicamba products to be labeled for use on dicamba-tolerant soybeans and cotton but did not direct or establish any process for EPA to consider amending the product labeling or restoring the prior registrations.  Under these facts, EPA has concluded that under FIFRA, existing stocks that are labeled for those uses became unregistered pesticide products because the labeling no longer conforms to the product registrations as they have been altered by the Court.  In the absence of an existing stocks order, stocks of the affected products labeled for the disallowed uses could not be lawfully distributed for any purpose, including voluntary recall by the registrant, disposal, or relabeling to remove the disallowed uses.

Despite the assertions by the Petitioners that FIFRA prohibits use of unregistered pesticides, FIFRA has not been construed in this manner.  While it a violation of FIFRA to distribute or sell any pesticide product with labeling that does not conform to a valid registration, FIFRA does not include any similar prohibition on use of an unregistered pesticide.   Thus, in the absence of an existing stocks order, stocks of the three dicamba products with vacated registrations that are already in the hands of end users could be lawfully used without restriction.  This notion is reflected in the provisions addressing end users in the order.  No provision in the order authorizes end users who have the three dicamba products in their possession to do anything.  Rather, the order prohibits end users from using the three products except in compliance with the existing labeling and from using the products at all after July 31, 2020.

Of course, it is not surprising that EPA applied its established criteria for existing stocks orders in the manner that it did.  Representatives of affected growers argued that prohibiting all use of the products in the middle of the 2020 growing season would lead to billions of dollars in damages, at a time when the entire agricultural economy has already been severely impacted by the Covid-19 pandemic.

In addition to arguing that an existing stocks order was necessary to establish a practical regimen governing distribution and use of those stocks of the three dicamba products in channels of trade when the Court’s decision was issued, EPA will likely argue that the Circuit Court lacks jurisdiction to review the existing stocks order.


 

By Lisa M. Campbell, Timothy D. Backstrom, and James V. Aidala

On June 3, 2020, the U.S. Court of Appeals for the Ninth Circuit (Ninth Circuit) issued an opinion in National Family Farm Coalition v. EPA, No. 19-70115, vacating the U.S. Environmental Protection Agency’s (EPA) 2018 decisions to extend the conditional registrations for  three reduced volatility dicamba herbicides, Bayer’s XtendiMax, Corteva’s FeXapan, and BASF’s Engenia. 

The manufacturers of these dicamba products designed them to facilitate control of glyphosate resistant weeds in strains of soybeans and cotton that have been genetically modified to be dicamba tolerant (DT).  Although the manufacturers intended these dicamba products to be less volatile and less susceptible to drift into adjacent non-target areas than previous formulations of dicamba, there were nonetheless many complaints that the products cause damage to non-tolerant crops and other vulnerable vegetation.  The Petitioners that challenged EPA’s decision to extend the conditional registrations for these reformulated dicamba products include a group representing small farmers who claim that the new dicamba products have damaged their crops (National Family Farm Coalition) and several non-governmental organizations that routinely oppose new pesticide registrations (the Center for Food Safety, the Center for Biological Diversity, and Pesticide Action Network North America). 

Although the case included some allegations by the Petitioners that EPA did not comply with the requirements of the Endangered Species Act, the court did not reach those issues.  The court found unanimously that EPA’s decision to extend the conditional registrations for the three dicamba herbicides did not satisfy the requirements of the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA).  Specifically, the court found that the administrative record compiled by EPA did not include “substantial evidence” supporting EPA’s determination that registering the new uses “would not significantly increase the risk of any unreasonable adverse effects on the environment.”  EPA is required under FIFRA Section 3(c)(7)(B) to make this determination to grant a conditional registration of new uses of a currently registered pesticide.  The court concluded that EPA could not make this required determination because, the court stated, the record shows that EPA “substantially understated the risks that it acknowledged” and also “entirely failed to acknowledge other risks.”

According to the court, EPA made six material errors in its analysis supporting the registrations. First, the court stated that EPA understated the amount of acreage planted with DT crops in 2018, and consequently also underestimated the amount of the new dicamba products that would be applied that year, even though the decision to extend the conditional registrations for the new dicamba products was not issued until the end of the 2018 growing season.  Second, in the court’s view, EPA improperly found that the number of complaints concerning damage to non-target crops and vegetation by the new dicamba products might be over-reported when the record included overwhelming evidence that non-target damage was being under-reported.  Third, the court stated that EPA refused even to estimate how much damage to non-target vegetation would be caused by the new dicamba products when the record contained sufficient information for EPA to make such an estimate.  Fourth, according to the court, EPA refused to acknowledge the substantial risk of non-compliance with the large number of detailed restrictions set forth in the 40-page approved label, although the court found that “there was substantial evidence that even conscientious applicators had not been able to consistently adhere to the label requirements.”  Fifth, the court believes EPA failed to acknowledge the anti-competitive effect of the new technology, which encourages other growers to use DT crops even if they do not use the new dicamba products, to avoid damage from nearby applications.  Sixth, according to the court, EPA failed to acknowledge the social cost being caused in small communities where damage caused by use of the new dicamba products has turned formerly amicable neighbors against each other. 

Based on all of these purported deficiencies, the court held that EPA’s rationale for determining that the risk of unreasonable adverse effects would not be significantly increased by the new dicamba uses, and that the registration for the new dicamba products could therefore be extended for two additional years, was not supported by “substantial evidence” in the administrative record taken as a whole.  The court also held that remanding the matter to EPA for further action without vacatur would not be appropriate because EPA did not satisfy the requirement to extend the conditional registrations.  Instead, the court simply vacated the registrations and invited EPA to try again.  The court acknowledged that such a decision would cause disruption, especially for those growers that have already purchased DT seeds and dicamba herbicides for this year's growing season, but concluded that no remedy other than vacatur would be appropriate given the deficiencies in the administrative record.

Commentary

When FIFRA was amended to allow new pesticide products to be “conditionally” registered even though the applicants had not submitted data to satisfy all applicable requirements, the focus was primarily on allowing registration of new products that are “substantially similar” to already registered products.  FIFRA Section 3(c)(7) also allows conditional registrations to be issued for new uses of existing active ingredients and for new active ingredients without all required data if EPA has sufficient information to make certain findings while it waits for additional data, but requires that EPA be able to determine that certain requirements can be met even though not all of the supporting data that will ultimately be needed are yet available.

This court’s decision illustrates the type of problems that can occur when EPA issues a conditional registration for new products that are not “substantially similar” to registered products.  The court’s view of the sufficiency of the record in this case sets a high bar for the determinations that must support other types of conditional registrations.  This problem was previously illustrated when a reviewing court vacated a new registration for a new nanosilver product even though there were already registered nanosilver products.  In that case, because EPA chose as a matter of policy to characterize the product as a new active ingredient, it was required to make a “public interest” determination under FIFRA Section 3(c)(7)(C).  When the administrative record was deemed insufficient to support this mandatory determination, the reviewing court vacated the registration. 

In the case of the new dicamba products, to grant conditional registrations for new uses of an existing active ingredient, EPA was required to determine that the new uses on DT soybeans and cotton would not “significantly increase the risk of unreasonable adverse effects on the environment” under FIFRA Section 3(c)(7)(B).  The court found the record supporting this mandatory determination to be insufficient, resulting in the court’s vacatur of EPA’s decision.  These two reviewing courts have taken a relatively deep dive into the administrative record supporting a conditional registration for a new use of an existing active ingredient or a new active ingredient in evaluating whether substantial evidence in the record supports the determinations required by FIFRA.  Whether future decisions will maintain such a stringent evidentiary standard will be important to monitor.


 

By Lisa M. Campbell and Timothy D. Backstrom

On August 7, 2019, the League of United Latin American Citizens, Pesticide Action Network North America, Natural Resources Defense Council, and other petitioners (Petitioners) filed a new petition in the Ninth Circuit Court of Appeals seeking judicial review of United States Environmental Protection Agency (EPA) orders denying their request that EPA revoke all tolerances and cancel all registrations for chlorpyrifos.  On August 8, 2019, New York, California, Hawaii, Maryland, Vermont, Washington, Massachusetts, and the District of Columbia (States) also filed a new petition for judicial review concerning the refusal of EPA to ban chlorpyrifos.  The Petitioners and the States seek judicial review of the July 18, 2019, final order by EPA dismissing all objections to the initial decision by EPA to retain tolerances and registrations for chlorpyrifos, and of EPA’s March 29, 2017, order that initially denied a 2007 petition to revoke all tolerances and cancel all registrations for chlorpyrifos.

The Petitioners and the States also seek consolidation of their newly filed petitions for judicial review with currently pending chlorpyrifos litigation in LULAC, et al. v. Wheeler, et al.  As part of rehearing in the LULAC case, the Ninth Circuit vacated a prior decision that ordered EPA to cancel chlorpyrifos registrations, and instead issued a writ of mandamus requiring EPA to respond to objections to the 2017 denial order within 90 days.  EPA then issued the July 18, 2019, order denying all objections, along with a motion on July 19, 2019, to dismiss the LULAC case as moot.  EPA seeks dismissal of LULAC because it contends that the 2017 initial order was never itself reviewable, and EPA has now done everything that the writ of mandamus required. The Petitioners oppose the motion to dismiss because it would require the Court to take a position on a jurisdictional issue which they contend was not decided during rehearing.  The Petitioners and the States also argue that dismissal would be unnecessary and inefficient, requiring the challenging parties to reconstitute the record for review compiled in LULAC.

Petitioners also note that the Ninth Circuit retained jurisdiction when it issued mandamus in LULAC, and they request that their combined challenge to the EPA decision to retain the existing tolerances and registrations for chlorpyrifos be heard by the Court en banc as well.

Commentary

The latest petitions for judicial review of EPA’s 2019 decision to retain all tolerances and registrations for chlorpyrifos pending registration review were anticipated by all parties, and all parties agree that the procedural requisites for a judicial determination concerning the legality of EPA’s final decision to deny the 2007 administrative petition have now been satisfied.  The Petitioners and the States will likely argue that prior scientific determinations by EPA, including EPA analysis of epidemiology studies that purport to establish a link between exposure to chlorpyrifos and adverse neurodevelopmental effects in children, require that EPA proceed to revoke all tolerances and cancel all registrations for chlorpyrifos, while EPA will likely argue that difficult scientific issues concerning chlorpyrifos remain unresolved and should be addressed by EPA as part of the pending registration review for chlorpyrifos.

In addition to the dispute about combining the new petitions for review with the LULAC case, an interesting element of the latest filing by the Petitioners is that they attempt to bootstrap en banc review of the 2019 order in which EPA finally denied the administrative petition to revoke tolerances and cancel registrations for chlorpyrifos.  En banc review for an initial hearing (as opposed to en banc rehearing in a previously decided case) is allowed by the applicable appellate rules, but such review is disfavored and would be highly unusual.  Petitioners argue that it is warranted here because the en banc panel in the rehearing in the LULAC case reserved jurisdiction.  Given the motion by EPA to dismiss the LULAC case as moot, it can be presumed that EPA is likely to oppose this vicarious argument for en banc judicial review.   EPA can argue that the only reason the en banc panel retained jurisdiction was to assure that EPA would timely comply with the writ of mandamus that required EPA to rule on the objections within 90 days.

For further information on the long history of litigation concerning the petition to ban chlorpyrifos, please review our prior blog entries.


 

By Lisa M. Campbell and Lisa R. Burchi

On May 30, 2019, the U.S. Court of Appeals for the Ninth Circuit (Ninth Circuit) issued an order in National Family Farm Coalition v. EPA, No. 17-70810 (filed Mar. 21, 2017) regarding the scope of its review of a petition challenging a 2017 U.S. Environmental Protection Agency (EPA) Notice of Pesticide Registration.  This 2017 order addresses Dow AgroSciences LLC’s Enlist Duo product.  The Petitioners include the National Family Farm Coalition and the Natural Resources Defense Council.

The May 30, 2019, order addresses whether the court could review two prior EPA orders, one issued in 2014 and one in 2015, regarding the registration of Enlist Duo.  Those 2014 and 2015 EPA orders had also been challenged in court, and subsequently remanded to EPA to consider additional information.  Following EPA’s consideration of this additional information, EPA increased the allowed use sites for the Enlist Duo registration to include cotton and increased the number of states authorized to use Enlist Duo from 15 to 34 states.

The Ninth Circuit’s May 30, 2019, order finds that the 2017 order “reissues the original Enlist Duo registration and amendment addressed in the 2014 and 2015 orders, thus making the full registration of Enlist Duo for GE corn, soybean and cotton for use in 34 states subject to [its] review.”  The court based its decision on the language of EPA’s 2017 order and EPA’s Final Registration Decision.  The court found persuasive, for example, that EPA’s 2017 order states that it “supercedes” EPA’s 2014 order, which the court stated is “consistent with our determination that the 2014 order previously remanded to EPA has now been finalized.”  Since EPA identified its 2017 order as final and had characterized its 2014 and 2015 orders as having an incomplete record, the court stated that it will “review the 2017 order on the combined records of the 2014, 2015 and 2017 orders, all of which is incorporated into the 2017 order’s record.”

The court further noted that EPA’s “2017 order also purports to extend the 2014 registration’s (and that of the 2015 amendment) initial 2020 expiration date by two years.”  Since the court found that nothing “suggests that this term is specific to the new uses on GE cotton in 34 states or GE corn and soybean in the additional 19 states,” the court stated that the 2017 EPA order could not have been limited to adding only these post-2015 uses as EPA had asserted. 

Following this determination, the Ninth Circuit stated that “submission of this case is deferred” pending additional briefing to address “all challenges to the initial registration (2014 order) and the original amendment (2015 order), as that registration and amendment has been reissued in the 2017 order -- including challenges to all supporting documentation” and “what relief [it] should provide if Petitioners’ claims are successful, ‘in whole or in part.’”  The timing for such briefing is as follows:

  • Counsel for each Petitioner is directed to file a supplemental brief of 7,000 words or less within 60 days of the date of the order (by July 30, 2019);
  • Counsel for Respondent and Intervenor are directed to file a responsive brief of 7,000 words or less within 60 days from the date of filing of Petitioners’ briefs; and
  • Petitioners may each file reply briefs not to exceed 3,500 words within 30 days from the date of the filing of Respondent’s brief. 

 

By Timothy D. Backstrom

On April 19, 2019, the U.S. Circuit Court of Appeals for the Ninth Circuit (Ninth Circuit) issued an order following an en banc rehearing in League of United Latin Am. Citizens (LULAC) v. Wheeler, No. 17-71636.  The February 6, 2019, Ninth Circuit decision to grant a U.S. Environmental Protection Agency (EPA) request for rehearing effectively vacated an August 9, 2018, decision in LULAC that had ordered EPA to revoke all tolerances and cancel all registrations for chlorpyrifos.  After rehearing, the en banc panel issued a writ of mandamus directing EPA “to issue, no later than 90 days after the filing of this order, a full and fair decision on LULAC’s objections" to an initial EPA order denying a 2007 petition to revoke all tolerances for chlorpyrifos.  The en banc order states that the court has discretion to construe the Petitioners' opening brief as a request for mandamus relief, even though the Petitioners sought judicial review of EPA's initial denial decision without waiting for EPA to rule on their objections and even though they did not file a petition for mandamus under the applicable procedural rule.  The court then states that “[c]onsidering the history and chronology of this matter and the nature of the claims, we conclude mandamus is appropriate, and we hereby GRANT the Petition for a Writ of Mandamus.”

The court states that “EPA represented that it could issue a final decision with respect to petitioners’ objections within 90 days of an order issued by this court” during oral argument on March 26, 2019.  The en banc ruling, however, does not discuss the jurisdictional issues presented when the Petitioners sought judicial review of EPA's initial denial decision without waiting for EPA to rule on their objections.  Moreover, the ruling does not discuss the substantive dispute concerning EPA's authority to decline to revoke the tolerances and cancel the registrations for chlorpyrifos based on the current administrative record.

Commentary

The procedural questions presented in the LULAC litigation are unusual and reflect a long and contentious history.  EPA’s April 5, 2017, decision to deny a 2007 petition to revoke the tolerances and cancel the registrations for chlorpyrifos came after issuance of a prior writ of mandamus that required EPA to take action on the pending petition, an EPA proposal to revoke the tolerances for chlorpyrifos issued in response to the prior writ, and a subsequent decision by EPA during the early days of the Trump administration to reverse course on the proposal and keep the tolerances in place while EPA completed the registration review process.  The Petitioners in LULAC duly filed objections to the initial denial of their tolerance petition, which was a necessary statutory prerequisite to pursuing further judicial review.  In addition, however, they elected to file for judicial review of EPA's initial denial of their tolerance petition on the same day as they filed their objections.  The Petitioners could not yet reasonably seek mandamus at that time because EPA had not been afforded any time yet to respond to their objections.  Instead, the Petitioners argued that requiring them to follow the normal administrative process would be futile.

Although the Ninth Circuit's decision after en banc rehearing may appear to a procedural victory for EPA, it can also be seen as a solution to the quandary created by the Petitioners' actions and the first court decision.  The Ninth Circuit as a whole was apparently not comfortable with the decision by the first panel that the Petitioners should be allowed to obtain review of a non-final order because waiting for final and reviewable EPA action would be a futility.  Nevertheless, by issuing a new writ of mandamus, the court seems to be sending a clear signal that it will not countenance further delays in EPA’s taking final action on the petition to revoke the chlorpyrifos tolerances.  In the relatively brief time remaining before the court deadline for final action, EPA confronts a significant challenge of ensuring all relevant data have been adequately and appropriately considered, particularly given the many controversies concerning the data that EPA used to support its initial decision to revoke the tolerances. 

More information on the protracted litigation concerning chlorpyrifos is available on our blog under key words chlorpyrifos and ninth circuit.


 

By Lisa M. Campbell and Lisa R. Burchi

On February 6, 2019, the U.S. Court of Appeals for the Ninth Circuit (Ninth Circuit) issued an order granting the U.S. Environmental Protection Agency’s (EPA) and Acting EPA Administrator Andrew Wheeler’s (collectively EPA or Respondents) September 24, 2018, petition for an en banc rehearing concerning the Ninth Circuit’s August 9, 2018, decision that vacated an EPA order maintaining chlorpyrifos registrations and remanded the case to EPA with directions to revoke all tolerances and cancel all registrations for chlorpyrifos within 60 days. 

The Ninth Circuit’s order granting the Respondent’s petition that the case be re-heard en banc does not provide an explanation for its decision.  The Ninth Circuit evidently found the arguments offered by Respondents and other interested parties that filed amicus curiae briefs more persuasive than Petitioners’ brief (including the Pesticide Action Network North America (PANNA) and the Natural Resources Defense Council (NRDC)), who argued against submission of certain amicus curiae briefs and also that, with limited exception, Respondent’s petition for rehearing lacked merit and should be denied. 

The en banc oral argument will be held March 26, 2019, at 2:30 p.m. (PST).

Arguments for Rehearing

Prior to the February 6, 2019, order, on October 15, 2018, three amicus curiae briefs were filed in support of EPA’s petition by CropLife America (CLA), Agribusiness Council of Indiana (Agribusiness), and Dow Agrosciences LLC (DAS).  Despite Petitioners’ objection to the motions of Agribusiness and CLA for leave to file amicus curiae briefs in support of Respondent’s petition for rehearing, on November 13, 2018, the Ninth Circuit granted the motions for leave to file amicus curiae briefs.

EPA’s petition for rehearing made multiple arguments as to why an en banc and panel rehearing should be granted, including the Panel’s lack of jurisdiction, the Panel’s order conflicting with applicable Supreme Court precedent, and specific modifications to be addressed to the order to comply with Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) requirements.  More information regarding EPA’s petition is available in our blog item “EPA Petitions for En Banc and Panel Rehearing in Ninth Circuit Chlorpyrifos Case.”

The amicus curiae briefs supported EPA’s arguments and also made arguments supporting rehearing in addition to those previously set forth by EPA.  CLA’s brief focused on the fact that the Panel’s decision disregarded FIFRA’s cancellation process, stating: “if EPA ultimately were to determine that any chlorpyrifos registration would need to be cancelled, such an action could not be accomplished in the way the panel majority prescribed:  by circumventing the procedures Congress required to ensure that pesticide cancellation decisions are not made unless and until these harms and the best science available are properly vetted.”  DAS’ brief addressed in detail the Panel’s violation of administrative law in dictating how EPA must act (i.e., cancel the chlorpyrifos registrations) and the potential violation of FIFRA by EPA if forced to comply with the Panel’s order regarding the timing for cancelling such registrations.  The amicus curiae briefs also sought to provide information on the practical consequences that chlorpyrifos registrants and users would face if the panel opinion is not revised.  For example, DAS discussed its proprietary interest in protecting its registrations and defending its product, while Agribusiness in its brief provided some background on the use and benefits of chlorpyrifos, the lack of viable alternatives, and the ramifications of the order on insect pest resistance and the ability to combat new invasive pests. 

Petitioners’ response to the petition for rehearing and rehearing en banc argued that there was no basis for rehearing.  Petitioners noted that en banc review is “disfavored” and appropriate in limited “extraordinary circumstances” and in the face of “an irreconcilable conflict between the holdings of controlling prior decisions of this court.”  Petitioners argued that the Panel decision was in accord with precedent and that a request for rehearing “would only result in further delay.”  Petitioners did concede on two points:  (1) modifying the order to direct EPA to cancel the registrations under the FIFRA cancellation process, which necessitates more time than the 60 days set forth in the order; and (2) clarifying that the order is limited to cancelling registrations that can result in residues on food. 

EPA, chlorpyrifos registrants and users, and industry generally should be encouraged by the decision to grant an en banc rehearing in this case, but the outcome is far from certain.  Given the issues at stake, registrants should monitor this hearing closely.


 

By Timothy D. Backstrom and Lisa M. Campbell 

On September 24, 2018, in the U.S. Court of Appeals for the Ninth Circuit (Ninth Circuit), respondents U.S. Environmental Protection Agency (EPA) and Acting EPA Administrator Andrew Wheeler (collectively EPA) petitioned for an en banc and panel rehearing concerning the Ninth Circuit’s August 9, 2018, decision that granted judicial review of EPA’s initial order denying an administrative petition by the Pesticide Action Network North America (PANNA) and the Natural Resources Defense Council (NRDC) to revoke all tolerances and cancel all registrations for chlorpyrifos, and that specifically directed EPA to revoke all tolerances and cancel all registrations for chlorpyrifos within 60 days.  More information regarding the August 9 decision is available in our blog item “Ninth Circuit Directs EPA to Revoke all Tolerances and Cancel All Registrations for Chlorpyrifos.”

EPA’s petition for rehearing sets forth three discrete procedural arguments as to why rehearing should be granted.  The first argument is that the panel erred because “an initial decision denying an administrative petition under 21 U.S.C. § 346a(d)(4)(A)(iii) is simply not within the jurisdiction of this Court to review ….”  EPA contends that the decision to grant judicial review of the initial EPA order, without waiting for EPA to respond to objections or to issue a final order, conflicts with the applicable precedent in both the Ninth Circuit and the U.S. Court of Appeals for the Second Circuit (Second Circuit).

EPA’s second argument is that, even if the initial EPA order is deemed to be reviewable, the panel’s decision directing EPA to take specific actions on remand “exceeded the remedial authority granted the courts by Congress” and conflicts with applicable Supreme Court precedent.  EPA identifies some other actions that EPA could hypothetically have decided to take on remand, including denying the administrative petition based on a finding that the Federal Food, Drug, and Cosmetic Act (FFDCA) safety standard is met, reducing the affected tolerances, or revoking only certain tolerances.  EPA argues that the court was not empowered to direct EPA to take specific actions, but should have instead remanded the matter to EPA “for further consideration in light of the panel’s holding that EPA may not ‘decline to revoke chlorpyrifos tolerances [without] mak[ing] a finding of reasonable certainty that the tolerances were safe.’”

EPA’s third argument is that, in the event a broader rehearing is not granted, a rehearing by the panel should nonetheless be convened to modify the relief ordered under the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA).  EPA argues that revocation of the chlorpyrifos tolerances would not lead automatically to cancellation of all chlorpyrifos registrations, because there are also some non-food uses for chlorpyrifos.  EPA states that “FIFRA incorporates the safety standard of the FFDCA only with respect to food-use pesticides …” (emphasis in original).  EPA also notes that EPA lacks authority to comply with the court’s order to cancel all chlorpyrifos registrations within 60 days, because EPA must follow the statutory procedure for cancellation under FIFRA Section 6(b), which requires EPA to forward a proposed cancellation first to the U.S. Department of Agriculture (USDA) and the FIFRA Scientific Advisory Panel (SAP), and to afford the affected registrants and other adversely affected persons an opportunity to request an adjudicatory hearing to contest the proposed cancellation.  EPA states that the panel should provide at least a limited rehearing, because it granted relief without the benefit of any prior briefing on remedy in which these significant problems would have been identified.

Commentary

Although parties to appellate litigation often seek rehearing or rehearing en banc, federal agencies represented by the U.S. Department of Justice (DOJ) are considerably more selective about the circumstances in which they will file a petition for rehearing.  There are some compelling arguments supported by precedent that judicial review is not available under the FFDCA for the type of initial order concerning which the petitioners in this case sought review.  Moreover, EPA has identified some practical factors which make it literally impossible for EPA both to adhere to mandatory statutory procedures under FIFRA and to comply with the terms of the court’s order.  For this reason, even if a broader rehearing is not granted concerning the jurisdictional question or the authority of the court to order EPA to take specific actions, a narrower rehearing before the appellate panel may be ordered, which would allow the parties an opportunity for further briefing on remedy and permit the court to modify its order.

More information on chlorpyrifos issues, including further proceedings in this case, is available on our blog under key word chlorpyrifos.


 

By Lisa M. Campbell and Timothy D. Backstrom

On August 9, 2018, the majority of a three-judge panel of the U.S. Court of Appeals for the Ninth Circuit (Ninth Circuit) issued an opinion in the latest chlorpyrifos case (League of United Latin American Citizens (LULAC) v. Wheeler, No. 17-71636) granting the petition for review of a 2017 order by the U.S. Environmental Protection Agency (EPA) that denied an administrative petition to revoke the tolerances for chlorpyrifos; vacating the 2017 order; and remanding the matter back to EPA with explicit directions to EPA to “revoke all tolerances and cancel all registrations for chlorpyrifos within 60 days.”  A separate dissent stated that the court should have dismissed the case for lack of jurisdiction.  Please see our blog item “EPA Denies Petition to Ban Chlorpyrifos” for more information on EPA’s denial of the petition in 2017.

EPA argued in its brief that the court lacks jurisdiction to review the 2017 order denying the petition to revoke the tolerances for chlorpyrifos because Section 408(g)(2)(C) of the Federal Food, Drug, and Cosmetic Act (FFDCA) requires EPA to rule on administrative objections to its denial of the petition to revoke the tolerances for chlorpyrifos before judicial review is available under FFDCA Section 408(h)(1).The majority opinion rejected this argument, stating that FFDCA Section 408(h)(1) “does not ‘clearly state’ that obtaining a section (g)(2)(C) order in response to administrative objections is a jurisdictional requirement.” Rather than a jurisdictional limitation, the majority construed the objections process in FFDCA as a non-jurisdictional “claims-processing rule.”In contrast, the dissenting judge agreed with EPA’s argument that the court lacks jurisdiction to review this matter until after EPA responds to the objections to the 2017 order.

After concluding that the objections process is not jurisdictional in character, the majority next considered whether the petitioners should nonetheless be required to exhaust their administrative remedies by waiting until EPA responds to their objections before obtaining judicial review.Although FFDCA Section 408(g)(2)(C) requires EPA to rule on the objections “as soon as practicable,” EPA had taken no action for 13 months after the objections were filed.The majority concluded that the exhaustion requirement should be waived “in light of the strong individual interests against requiring exhaustion and weak institutional interests in favor of it.”

EPA did not specifically address the substantive merits of the 2017 order in its brief, and the majority found that EPA has consequently “forfeited any merits-based argument.”The 2017 order was issued in the context of an administrative record in which EPA has repeatedly determined that the FFDCA standard for maintenance of chlorpyrifos tolerances (“a reasonable certainty that no harm will result from aggregate exposure to the pesticide”) could not be met because of the risk of neurodevelopmental effects. The standard for registration under the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) incorporates this same FFDCA standard. Although the 2017 order stated that “the science addressing neurodevelopmental effects is unresolved,” it did nothing to alter these prior EPA determinations. The majority noted that EPA’s assertion that “significant uncertainty” remains regarding the health effects of chlorpyrifos being directly at odds with the “reasonably certainty” standard and “therefore mandates revoking the tolerance under [FFDCA Section 408(b)(2)(A)(i)].” The majority concluded that the possibility that future evidence may contradict EPA’s current determinations cannot justify continued inaction, and that the failure of EPA to proceed with the revocation of the tolerances and the cancellation of the registrations for chlorpyrifos “has now placed the agency in direct contravention of the FFDCA and FIFRA.”

Commentary

The court’s direct instruction requiring EPA to proceed promptly with revocation of all tolerances and cancellations of all registrations for chlorpyrifos represents an unusually aggressive judicial intervention in the administrative process.Nevertheless, this outcome must be viewed in the context of an eleven year history beginning with an administrative petition that requested the same relief, followed by a writ of mandamus in 2015 from the same court requiring EPA to make a prompt decision on the petition.Although substantial controversy remains concerning the correct interpretation of epidemiology studies with chlorpyrifos, it appears that the court believes that EPA has not taken any action that would support a change in EPA’s prior conclusion that these studies constitute evidence of potential neurodevelopmental effects in children at chlorpyrifos exposure levels below the threshold for acetylcholinesterase (AChE) inhibition. Had EPA’s 2017 denial of the administrative petition been accompanied by an amended risk assessment for chlorpyrifos which articulated a changed conclusion, the court may have been less likely to substitute its judgment for that of EPA.The court seemed to find that because the scientific assessments in the current administrative record could not support the “reasonable certainty” standard in the FFDCA, the conclusion it reached on the merits was unavoidable.

Please see our blog item “Oral Argument Held in Case Challenging EPA’s Denial of Petition to Revoke Chlorpyrifos Tolerances” for information on the oral argument that took place on July 9, 2018, and the briefing in this case.  Further information on the case proceedings is available on our blog under key word chlorpyrifos.


 

By Lisa M. Campbell and Timothy D. Backstrom

On December 20, 2017, the U.S. Court of Appeals for the Ninth Circuit issued an order in LULAC v. Pruitt, Case No. 17-71636, a case challenging an order denying administrative petitions to revoke the tolerances and cancel the registrations for chlorpyrifos.  The court’s order includes actions concerning two pending motions.  The court has denied a motion by the U.S. Environmental Protection Agency (EPA) and Administrator Pruitt (Respondents) to dismiss the case for lack of jurisdiction while granting a motion by League of United Latin American Citizens (LULAC), et al. (Petitioners) to expedite briefing and hearing in the case.  More information on these two motions is available in our blog item “NGOs and Farmworkers File Motion for Expedited Briefing and Hearing in Chlorpyrifos Litigation.”

In support of their August 21, 2017, motion to dismiss the case for lack of jurisdiction, Respondents argued that the Federal Food, Drug, and Cosmetic Act (FFDCA) requires the Petitioners to exhaust their administrative remedies by submitting formal objections to the order denying their request to revoke the tolerances for chlorpyrifos and then waiting for EPA to issue a final order before they may seek judicial review.  The Petitioners argued in response that requiring exhaustion in this instance would be “futile,” and that the court should also consider reviewing the EPA order under the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA), because EPA has declined to cancel the registrations for chlorpyrifos.  In response, Respondents argued that Petitioners have not shown that requiring exhaustion of administrative remedies would be futile, and that 21 U.S.C. § 346a(h)(5) explicitly prohibits judicial review of any order concerning pesticide tolerances under any other statute, including FIFRA.

After the motion to dismiss was fully briefed, the court summarily denied it, but also characterized that denial as “without prejudice to renewing the arguments in the answering brief.”  The court also denied a motion by the Petitioners for oral argument concerning the pending motion to dismiss.  These two actions indicate that the court has decided to defer argument and resolution of the jurisdictional issues presented by the motion to dismiss until briefing and argument on the merits.

The court also granted an October 13, 2017, motion by the Petitioners to expedite briefing and hearing in the case.  Petitioners submitted this motion to expedite because they contend that the refusal of EPA to revoke the tolerances and cancel the registrations for chlorpyrifos is causing ongoing harm even though EPA “did not and cannot determine that chlorpyrifos is safe under the Food Quality Protection Act.”  The court set the following expedited briefing schedule:  Petitioners’ opening brief is due January 23, 2018; Intervenors’ brief(s) are due February 6, 2018; Respondents’ answering brief is due March 8, 2018; Petitioners’ optional reply brief is due 28 days after service of Respondents’ brief; and Intervenors’ optional reply brief(s) are due 42 days after service of Respondents’ brief.  The court also directed the Clerk to “calendar this case [for argument] as soon as possible upon completion of briefing.”

Commentary

The current actions of the court should be viewed in the context of the prior decision by this same court to issue a writ of mandamus that required EPA to take action on pending petitions to cancel the registrations and revoke the tolerances for chlorpyrifos after what Petitioners claimed was a quite protracted administrative delay, and the subsequent decision by EPA under Administrator Pruitt to defer final action on chlorpyrifos, after the prior Administration had proposed to take the actions sought by the Petitioners.  By granting the motion to expedite, and also by deferring the ultimate disposition of the jurisdictional issues raised by EPA, the court appears to have given the Petitioners a prompt and full opportunity to explain why judicial intervention at this stage of the administrative process is warranted.  Nevertheless, because the jurisdictional arguments made by EPA are supported by substantial precedent, it could prove difficult for the Petitioners ultimately to overcome these arguments. 

More information on the chlorpyrifos litigation and related matters is available on our blog under key word chlorpyrifos


 

By Lisa M. Campbell and Timothy D. Backstrom

On October 13, 2017, Petitioners League of United Latin American Citizens (LULAC), et al. filed a motion to expedite briefing and hearing in League of United Latin American Citizens v. Pruitt, Case No. 17-71636 (9th Cir. June 5, 2017).  In their motion, Petitioners request that the court “expedite proceedings because of the harm being caused by [U.S. Environmental Protection Agency (EPA)] Administrator Pruitt leaving chlorpyrifos tolerances in effect when he did not and cannot determine that chlorpyrifos is safe under the Food Quality Protection Act.” 

Petitioners state there is good cause for expedition “because children continue to be exposed to chlorpyrifos in their food, drinking water, and the air around their homes, schools, and playfields, putting them at risk of such brain impairments as lower IQ, attention deficit disorders, and developmental delays,” and “Ninth Circuit Rule 27-12 provides that ‘motions to expedite briefing and hearing may be filed and will be granted upon a showing of good cause,’” including ‘“situations in which … in the absence of expedited treatment, irreparable harm may occur.’”  Pursuant to Ninth Circuit Rule 27-12, Petitioners determined the position of EPA counsel on the motion, who stated that, “EPA opposes the motion to expedite as premature under Circuit Rule 27-11(b).” 

 The Petitioners’ motion to expedite briefing was submitted despite the pendency of an unresolved motion to dismiss submitted by Respondents Administrator Pruitt and EPA on August 21, 2017.  In that motion, EPA argued that the court lacks jurisdiction to review the March 29, 2017, order denying the petition by Pesticide Action Network North America (PANNA) and Natural Resources Defense Council (NRDC) to revoke all Federal Food, Drug, and Cosmetic Act (FFDCA) tolerances for chlorpyrifos, until after the Petitioners have exhausted their administrative remedies by filing objections to the denial, and EPA has issued a final order ruling on such objections.  In its motion to dismiss, EPA noted that the Ninth Circuit denied a motion by PANNA and NRDC for further mandamus relief in In re PANNA on July 18, 2017, stating that “one valid agency response to a petition challenging a pesticide’s tolerances is to ‘issue an order denying the petition,’” and ‘“now that EPA has issued its denial, substantive objections must first be made through the administrative process mandated by’ the FFDCA.”

 On September 27, 2017, Petitioners filed their opposition to the motion to dismiss.  Petitioners argued that exhaustion of administrative remedies by filing objections under the FFDCA is not an absolute jurisdictional prerequisite to judicial review, and that the court can proceed with review under the “futility doctrine” because EPA’s refusal to revoke the tolerances for chlorpyrifos constitutes a “flagrant violation of a statutory prohibition.”  Petitioners also argued that even if FFDCA exhaustion is required, EPA has also denied the petition by PANNA and NRDC to cancel the registrations of chlorpyrifos, and that additional denial constitutes a final order that is subject to immediate review under FIFRA Section 16(b) because the notice and comment process concerning the petition was a “public hearing” under the applicable precedent.

 Commentary

The new motion by Petitioners LULAC, et al. to expedite briefing on the challenge to EPA’s denial of the PANNA and NRDC petition reflects the view of the Petitioners that this matter is urgent because continued use of chlorpyrifos jeopardizes the health of children, but this motion is unlikely to be resolved before the court rules on EPA’s pending motion to dismiss.  EPA has stated that it will oppose the Petitioners’ motion to expedite briefing as premature. Moreover, EPA has not yet replied to the arguments made by the Petitioners in their opposition to the pending dismissal motion.

To prevail on their argument that exhausting the administrative process prescribed by the FFDCA will be “futile,” the Petitioners likely will have to persuade the Court that these FFDCA procedures are not jurisdictional prerequisites to judicial review, and that there is little likelihood that EPA will change its mind in response to their objections.  With respect to the argument that EPA’s denial of the petition to cancel the registrations for chlorpyrifos is final agency action subject to immediate review under FIFRA Section 16(b), EPA will likely contend that this argument is contravened by 21 U.S.C. § 346a(h)(5), which states: “any issue as to which review is or was obtainable under this subsection shall not be the subject of judicial review under any other provision of law.”  It could be difficult for Petitioners to defeat this jurisdictional prohibition in the FFDCA; they would presumably need to show the court that their substantive contentions concerning the hazards posed by chlorpyrifos would not be directly implicated in EPA’s final determination of whether or not to revoke the tolerances for chlorpyrifos.

 This case will be carefully watched by pesticide industry observers. 

 More information on regulatory issues related to chlorpyrifos is available on our blog.


 
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