[00:00:00] Speaker 04:
You may proceed.

[00:00:00] Speaker 00:
Good morning, Your Honors. May it please the Court. Kelly Lester for petitioners. I'd like to reserve three minutes of my time for rebuttal.

[00:00:08] Speaker 00:
This case challenges EPA's rule for deca-BDE, a persistent, bioaccumulative, and toxic chemical linked to cancer and harm to children's brain development. Because of the uniquely harmful attributes of PBT chemicals like deca-BDE, TSCA requires EPA to adopt all practical measures to reduce exposure to them. EPA did not do so. Instead, its rule for deca-BDE largely codifies the status quo and leaves unregulated the very activities from which exposure to deca-BDE is expected to increase.

[00:00:39] Speaker 00:
I'd like to address two fundamental flaws with EPA's rule.

[00:00:43] Speaker 00:
First, the rule is unlawful because EPA applied the wrong standard in determining what regulations are practicable. Rather than evaluating whether a measure is capable of being done within existing constraints, EPA rejected regulatory measures based on an open-ended set of discretionary factors, including whether EPA deemed a measure reasonable. Second, even if EPA's interpretation of practicable were correct, the rule is still unlawful because its exemptions and loopholes are arbitrary and unsupported.

[00:01:12] Speaker 00:
As a result, this court should declare the rule unlawful and remand it to EPA.

[00:01:16] Speaker 00:
With respect to the first point, EPA interprets practicable to encompass what it views as reasonable in light of all circumstances. such as the relative costs and benefits of a measure. It never identifies limitation to this consideration of reasonableness, and it relies on this reading to label a measure impracticable because, for example, it doesn't view reducing exposures to be worth the costs.

[00:01:39] Speaker 00:
Allowing EPA to reject measures on reasonableness grounds is incompatible with Section 6 of TSCA.

[00:01:45] Speaker 00:
Section 6 provides two tracks to regulating existing chemicals. Section 6A is for nearly all chemicals, EPA conducts an assessment called a risk evaluation, where it looks at the magnitude of harm associated with specific exposures, and then it decides what exposures result in unreasonable risk. If it finds unreasonable risk, EPA has to eliminate it by regulating those exposures.

[00:02:08] Speaker 00:
Section 6H addresses a small set of chemicals that EPA rated high for their PBT characteristics, which were a priority concern for Congress.

[00:02:20] Speaker 00:
It ultimately only regulates five chemicals under this category.

[00:02:25] Speaker 00:
Here, Congress told EPA not to conduct a risk evaluation, just to go straight to risk management.

[00:02:32] Speaker 00:
So EPA doesn't analyze the harms associated with specific exposure levels. Congress instead directed EPA to focus on reducing exposure. It didn't give a discretion to say what exposures are worth reducing.

[00:02:45] Speaker 00:
EPA's position that it can reject exposure reduction measures because their costs supposedly aren't worth their benefits is irrational on its face because EPA has no basis to make that judgment. The lack of a risk evaluation means that EPA has no analysis of the benefit of reducing specific exposures, so it has no basis to say if the cost outweighs the benefit or if it's worth it. So EPA's position is simply not contemplated by the statute, and therefore it's also not supported by any analysis in the record.

[00:03:13] Speaker 00:
EPA's interpretation would undermine what Congress was trying to do in Section 6H. It used language that reflects a stringent standard to reduce exposures to a particularly harmful group of chemicals that were such a priority in legislation that Congress carved out an expedited rulemaking process for them. To say that EPA only need to reduce exposures to the extent it deems reasonable without any limitations on that would vitiate that stringent standard. The best reading is not that practical means reasonable. but that practicable means capable of being done, taking into account economic and technological constraints.

[00:03:48] Speaker 00:
It honors both the dictionary definitions of practicable and the stringent scheme that Congress created.

[00:03:54] Speaker 04:
So I gather your argument is that the six C2 factors cannot be considered in the 6H analysis. Is that right?

[00:04:05] Speaker 00:
That's correct, Your Honor.

[00:04:09] Speaker 00:
Even if EPA's interpretation of practicable were correct, The rule is still unlawful because the exclusions and loopholes are arbitrary and unsupported by substantial evidence. I want to focus on three cross-cutting flaws with EPA's rule. First, EPA took an all-or-nothing approach to regulation, not considering the practicability of targeting only high-priority industries or waste streams for exposure reduction measures. For example, EPA did not consider disposal restrictions only on waste from specific streams with high levels of deca-BDE, like electronic waste or waste vehicles.

[00:04:41] Speaker 00:
And similarly, EPA did not consider restricting the concentration of deca-BDE in recycling streams from these, in recyclable materials from these waste streams. And EPA's failure to consider these targeted reductions for recycling and disposal is especially problematic given that these are precisely the activities from which exposures are expected to increase.

[00:05:04] Speaker 00:
Second, EPA ignored evidence that it would be practical to reduce exposure to deca-BDE using existing technologies.

[00:05:11] Speaker 02:
Counsel, in reading this case, you're struck by the ability of Congress to come up with so many ambiguous phrases for what the standard here is. They were trying to divine what practical means along with achievability, feasibility, workability, reasonableness. And you're saying we can't consider those together, but I'm not sure what the difference is. And historically, Courts have given some deference to the agency's interpretation of the statute, so they have experience with it.

[00:05:42] Speaker 02:
How do we go about analyzing this statute and its application here, according to your view?

[00:05:48] Speaker 00:
Well, a few points, Your Honor.

[00:05:51] Speaker 00:
The court no longer needs to give deference to the agency.

[00:05:55] Speaker 04:
Well, we give Skidmore deference.

[00:05:57] Speaker 00:
I don't think Skidmore deference is appropriate here. There is no particularly longstanding interpretation that requires deference with respect to this.

[00:06:07] Speaker 04:
We know Chevron's out, but Skidmore is still alive.

[00:06:10] Speaker 02:
So how do I reconcile your claim that in one section we talk about the extent practicable compared to those other adjectives or adverbs in the next section, and you're not supposed to consider those together?

[00:06:26] Speaker 00:
with respect to achievable, feasible, workable, and reasonableness. So those are not statutory considerations. Those are considerations that EPA just used to give meaning to the term practicable. And we agree that feasible, achievable, and workable all do speak to what is capable of being done, which is the plain meaning of practicable. But what EPA essentially does is reads reasonable to blow any limitations off of what those first three factors that it purports to consider would actually entail.

[00:07:00] Speaker 00:
And so in so doing, it says that it doesn't need to address specific exposures because there are supposedly low levels. And as I explained, that's not a consideration that EPA can actually make under the statute.

[00:07:14] Speaker 02:
So in your view, were there specific proposals presented to EPA that they rejected as not being practicable?

[00:07:22] Speaker 00:
There were. So I reviewed a few of those, which are that there could be restrictions on only specific waste streams, disposal restrictions or recycling restrictions. EPA also did not consider whether it could use existing technology, for example, to address exposures from incineration or from wastewater. And EPA, it's a little bit hard to tell why EPA just said that it would be too expensive and difficult to regulate disposal because EPA gives no actual analysis of the expense and difficulty with that.

[00:08:02] Speaker 00:
So there are particular exposure reduction measures that were given and EPA just did not acknowledge them or respond to them.

[00:08:15] Speaker 00:
With respect to that second bucket of arbitrary and capricious arguments that I want to be sure to highlight today, EPA did not analyze the practicability of using cheaper sorting technology to reduce recycling-related exposures. And it asserts that it didn't have to consider these technologies at all because they cannot identify deca-BDE specifically. But that's irrational. Studies in the record show that these sorting technologies are highly effective at sorting out plastics containing deca-BDE.

[00:08:47] Speaker 00:
92% of plastics initially screened with one of these technologies, XRX, XRF, X-ray fluorescents, had decaBDE in it, and that's at 5ER969. In another study, 70% of plastics did. That's at 7ER1572. And as a result of this effectiveness and the accessibility of these technologies, they're used in the European Union to meet concentration restrictions on decaBDE and other PBDEs. DecaBDE is by far the most dominant congener of PBDE, which is the class to which decaBDE belongs.

[00:09:22] Speaker 00:
both because it was used in much larger quantities historically and also because it was phased out much later. So of more than 150 million pounds of PBDEs estimated that were still in use in 2020, 95% of that is deca-BDE.

[00:09:39] Speaker 00:
EPA didn't look at this feasibility analysis that we submitted to the record that post-dated EPA's 2021 rule that found that using these sorting technologies makes recycling restrictions feasible on an industrial scale in the European Union.

[00:09:57] Speaker 00:
And because it ignored important considerations on the record, that is arbitrary.

[00:10:03] Speaker 00:
As I mentioned before, EPA also ignored evidence of existing widely available technologies that are not uniformly deployed because that could be used to reduce exposures. So it did not consider requiring technology on incineration to reduce exposures or for wastewater discharges.

[00:10:22] Speaker 00:
And then the third bucket of arbitrary and capricious arguments is that EPA's exemptions and loopholes are unexplained and irrational. The starkest example of this is with respect to its failure to regulate the land application of sewage sludge. EPA simply said that it's not using its Section 6 authority at that time without explaining why.

[00:10:43] Speaker 00:
In rulemaking, as Judge Gould has written, it's not enough to assert without meaningful discussion that measures are impracticable.

[00:10:50] Speaker 00:
Agencies have to rationally explain why they did what they did, and here EPA did not do so.

[00:10:57] Speaker 00:
As I also mentioned before, EPA's reason for regulating disposal is unsupported and irrational. EPA claimed that it would be expensive and difficult to adopt any disposal restrictions because the Resource Conservation and Recovery Act generally regulates solid waste disposal, not even deca-BDE disposal specifically. But it cited no information whatsoever to support its claims. And there's no analysis of additional restrictions in the record.

[00:11:27] Speaker 00:
Unless the court has any questions, I can reserve the remainder of my time for rebuttal.

[00:11:31] Speaker 04:
Thank you, counsel.

[00:11:32] Speaker 00:
Thank you.

[00:11:45] Speaker 01:
Good morning. May it please the court. My name is Redding Cates for the United States Environmental Protection Agency.

[00:11:52] Speaker 01:
Deca-BDE is a persistent bioaccumulative and toxic substance. That's not in dispute. This case is about what Congress authorized EPA to do about it. Here's what EPA did.

[00:12:04] Speaker 01:
It banned the substance. Deca-BDE cannot be manufactured in this country, and it can't be made abroad and imported here. In 2021, EPA found that this was the fastest and most effective way to reduce deca-BDE exposures.

[00:12:22] Speaker 01:
Petitioners don't dispute that, but they wanted EPA to go further, to consider the deck of BDE that's already out there in circulation.

[00:12:31] Speaker 01:
EPA considered their comments, urging it to require municipal and other recyclers to find and remove plastic bound for recycling from the stream, and urging EPA to require wastewater treatment plants and landfills to take additional steps beyond the current regulation to reduce DECA BDE exposure.

[00:12:55] Speaker 01:
But EPA found that requiring municipal recyclers to test every single piece of plastic that comes in in the recycling stream that they must accept is simply not practicable. And EPA determined that the cost of testing a piece of plastic for the presence of DECA BDE is prohibitively expensive. And finally, no practicable means exist for requiring wastewater treatment plants and landfills to remove and segregate the little bit of deca-BDE that they process.

[00:13:29] Speaker 01:
The parties disagree about what to the extent practicable means, and this interpretive issue goes a long way to deciding this case. As you've already heard, EPA interprets practicable to mean achievable, feasible, workable, and reasonable, while also taking into consideration the C2 factors for all subsection A rules.

[00:13:50] Speaker 01:
Petitioners

[00:13:51] Speaker 04:
So what do you think that the C2 factors should be incorporated in CH?

[00:13:57] Speaker 04:
There's a reference. I know you're arguing on that, but here we are post-Chevron and we're into Skidmore.

[00:14:06] Speaker 04:
Why as a matter of statutory interpretation should we interpret the section the way you're urging us to?

[00:14:13] Speaker 01:
Well, we think under the plain meaning of the statute, the specific subsection H is points to a rule under subsection A. You go back to subsection A, and those rules have specific requirements. Now, it's true that Congress did not require EPA to do a risk assessment for these particular chemicals. And that's true, but it didn't say it couldn't. And I think the petitioners asserted that, and that's just not the case. The statute says that it doesn't have to.

[00:14:44] Speaker 01:
And so when EPA is looking at structure, it says, all right, well, under subsection H, we're supposed to issue a rule under subsection A. They go to subsection A, and subsection A lays out the requirements. C2 under the statute says requirements for a rule, and C2 lists those requirements. EPA looked at them and said, all of these are consistent with the kind of rule we'd be issuing here. They don't speak specifically to a risk assessment. There are parts under subsection A that do talk to risk assessments, and EPA thought, well, if we're not required to do one and we're not doing them here, then we should look at those.

[00:15:20] Speaker 01:
But it doesn't mean that the entire subsection A just gets thrown out the window.

[00:15:25] Speaker 04:
Well, there is the notion that if Congress intended risk assessments to be done in 6H, that it would have put it there.

[00:15:34] Speaker 04:
And the omission, inclusion in one section or subsection and exclusion in another does have some statutory interpretation consequences.

[00:15:47] Speaker 01:
I agree, Your Honor. I think, though, that When you look at subsection A, there are parts of it, including C2, that aren't reliant upon having a risk assessment being done. And that's why EPA had said, well, for these, we should continue to look at them because it still points us back to subsection A. If subsection H had said, don't look at A at all, this is a completely separate process, then I think petitioners would have a stronger argument.

[00:16:13] Speaker 04:
Well, part of the argument and the difference between you is that you claim there's a reasonableness requirement and they say that's not in the statute.

[00:16:23] Speaker 04:
My question for you is how do we measure reasonableness as we're looking in a petition for review? What metric do we use?

[00:16:33] Speaker 01:
Well, I think, Your Honor, that it's not simply reasonableness, right? EPA said and. So it is feasible. EPA said that part of the definition of practicable is it has to be feasible. Right. But the definition is reasonably capable of being accomplished, feasible in a given situation. So I would simply say that those definitions, which are the best definitions of practicable and are most consistent with the way courts have interpreted that word in other cases, speak to not simply can it be done at all, or not simply, I think, in their reply brief, they point to something called economic feasibility, which they mean, I think...

[00:17:13] Speaker 01:
so expensive that it just actually could, there isn't enough money to do it. And we would say that that's drawing the line way too high. And if you're looking for some boundary around reasonableness, I think the C2 factors provide those. But they do include looking at cost effectiveness, costs and benefits. And again, that is consistent with, you know, the court's opinion in State Farm, that even when a statute says you must adopt practical means, that was the automatic seatbelt case, the court said, well, you're still right to look at costs and benefits, and that's what EPA did here.

[00:17:48] Speaker 01:
Go ahead.

[00:17:50] UNKNOWN:
Okay.

[00:17:54] Speaker 01:
Now, I just gave the definition from Black's Law Dictionary, and we talked about the C2 factors, which are effects on health, effects on the environment, the benefits of the product, and then finally the economic consequences, and then C2 splits out to say the effect on the national economy, small businesses, costs and benefits, and cost effectiveness.

[00:18:20] Speaker 01:
In addition to the State Farm case I mentioned earlier, there's also Michigan, where the Supreme Court had a statute, the Clean Air Act, that didn't talk about costs at all and didn't say reasonable. But the court held that it was unreasonable to not consider costs. And so when EPA is looking at petitioners' comments saying you need to place additional burdens on municipalities that recycle, treat wastewater, and have landfills, EPA is thinking, we need substantial evidence that that can be done and that it's practicable.

[00:18:51] Speaker 01:
And when EPA looked at the examples that petitioners gave, they didn't find it, starting with recycling.

[00:19:00] Speaker 01:
So EPA found, first of all, that their widespread ban is going to massively reduce decapedy in this country by cutting it off at the source.

[00:19:09] Speaker 01:
And when it looked at testing, Petitioners don't dispute that actually testing a piece of plastic for deca-BDE is prohibitively expensive. You have to take it, melt it down, and then determine whether it has deca-BDE in it or not. They pointed to a couple of other processes that can be used, but I don't think it's exactly as the way they claim. First is this sorting method, which is a float and sort. But as they admit, that takes all PBT chemicals, not just deca-BDE.

[00:19:39] Speaker 01:
And deca-BDE is the only PBT chemical that is called out in the study EPA did for this particular Section H treatment. So EPA cannot use so wide a tool to separate out. They claim that 92% of the stuff that you would take out of the recycling stream using this method would be deca-BDE, but that's not what their studies actually say. The Stracoba study that they point to is a study where they went out and on purpose bought about 490 products that they thought were likely to contain deca-BDE, recycled deca-BDE.

[00:20:19] Speaker 01:
So that would be hairbrushes, toys. So this was not a, what does a cross-section of the recycling stream look like, right? It was targeted to find them. And when they did that, only nine of the actual products had high enough deca-BDE levels that it would be above the de minimis standard. That's less than 3 percent. Okay.

[00:20:44] Speaker 01:
So, when EPs looking at this, they're like, well, we're going to use this sorting mechanism, but it's maybe only 3 percent of it is actually going to be deca-BDE. And that does not, sitting where we are, justify the massive increased cost to put on municipalities for recycling. and also for landfills and wastewater treatment plants.

[00:21:07] Speaker 01:
The other argument they make is about e-waste. And they say, well, you could have segregated specific streams, you know, not the main general recycling stream, but what about just e-waste? But the issue there is that their own studies found that it said a fraction of a fraction, actually it said a small fraction of 9% would be a class of BFRs, which is a broader chemical of which deca-BDE is one.

[00:21:40] Speaker 01:
And it said, of that, a fraction is deca-BDE. So again, a small fraction of a fraction of 9% of e-waste. And EPA looked at that and said, that isn't worth the cost either. And so...

[00:22:02] Speaker 01:
When they pointed to wastewater treatment plants, another place that they say there are technologies that exist that could have reduced deca-BDE exposure in wastewater. But when you look at their actual studies, what they show is that the technique for reducing deca-BDE in wastewater, it says this is at ER 1505.

[00:22:29] Speaker 01:
the highest removal in all plants was obtained at longer retention time and higher MLSS in advanced treatment process. The primary removal mechanism is sorption to solids as opposed to biodegradation. Therefore, optimization of removal from the liquid train will maximize PBDE concentration in solid returns. What that means is that The example they gave of do this in wastewater treatment plants, essentially run it through so that it binds more to the solids, is that it would increase deca-BDE in the sewage sludge.

[00:23:05] Speaker 01:
The essential issue the EPA was facing is that these chemicals do not break down, and they have to go somewhere. And so the solution they offer for wastewater would just make the problem of sewage sludge even worse. And so faced with trying to create an entire new disposal regime for this one chemical, EPA thought the best thing for us to do is to cut it off at the source and to rely on RCRA and the other regimes we have for disposal at this time.

[00:23:34] Speaker 01:
That's another key point. EPA was clear to say that this was not a one and done rule. If additional information is created, comes out in studies, EPA will take another look at it.

[00:23:47] Speaker 02:
Well, counsel, on that point. Yes, sir. But appellants argue that EPA failed to consider regulatory options that would be an all-out ban, looking at specific facilities, for example, those with high-level decade BDE, such as end-of-life vehicles, construction, demolition waste, electronic waste. Why was that not feasible?

[00:24:04] Speaker 01:
Well, as I said earlier, taking e-waste as an example, when EPA dug into the data, what it found is that even amongst e-waste, you're looking at a small fraction of a small fraction of 9 percent of e-waste.

[00:24:18] Speaker 01:
it's needles in a haystack. And EPA, I think, using its correct interpretation of what practical means, said, well, we don't have to chase needles in a haystack under this standard. The juice is not worth the squeeze, especially when the ban is going to drive deca-BDE levels down. And again, the rule went into effect in 2021. It's been five years.

[00:24:41] Speaker 01:
So that's another, I guess, issue in the petitioner's data is that their studies all predate the ban and were based on data from years before that when deca-BDE was not banned and was far more pervasive.

[00:25:01] Speaker 01:
If the panel has no other questions. I have one more.

[00:25:04] Speaker 04:
I think both judges have a question. Go ahead.

[00:25:08] Speaker 04:
Judge Gould, do you have a question?

[00:25:11] Speaker 03:
Yes.

[00:25:12] Speaker 03:
What I'd like to ask counsel now is Does RICRA provide adequate protection from DECA BTE waste disposal?

[00:25:32] Speaker 01:
Your Honor, EPA concluded that it did because it provides regulations for landfills.

[00:25:41] Speaker 01:
Petitioners do point out that there is some potential for additional exposure, but They recommended treating decabedia as a hazardous substance, and when EPA looked at that, it's the same needle in a haystack problem. It would be massively expensive for municipalities to convert this to a hazardous waste for very little benefit. And so that's why EPA made the decision not to reclassify it.

[00:26:06] Speaker 03:
Okay, thank you.

[00:26:09] Speaker 02:
And, Council, would you address the decision not to regulate sewage sludge? What's the explanation for that?

[00:26:17] Speaker 01:
It's the same as wastewater treatment. Testing for the presence of deca-BDE is so expensive as to be impossible.

[00:26:26] Speaker 02:
And how do we know that? Is there information in the record to support that claim?

[00:26:30] Speaker 01:
There is. It's the same information for testing for recycling. There's no other way for a wastewater treatment plant to be told by EPA, get all the deca-BDE out of your wastewater.

[00:26:44] Speaker 01:
There's no way for a wastewater treatment plant to do that effectively.

[00:26:49] Speaker 01:
not in a way that's cost effective.

[00:26:51] Speaker 01:
The examples they gave were just to run the treatment again so that it binds more to the solids. But as I mentioned earlier, that just increases decabede in the sewage sludge.

[00:27:01] Speaker 04:
Okay. Any further questions? I think Judge Morris may have another one. No, thanks. Okay. Judge Gould?

[00:27:11] Speaker 04:
No, I have no further questions. Okay. Thank you, counsel.

[00:27:23] Speaker 00:
I'd like to correct a few things that council for the government said. First, they argue that testing the incoming stream for recycling would be required in order to do any recycling restrictions. I think this underscores that they didn't actually review the evidence in the record. That shows that that's often not how it happens. In the European Union feasibility report, that's at 9-ER-1964, Section 11 of that shows that there are sorting methods that where it's actually tested for these PBDEs is at the end of the process.

[00:28:03] Speaker 00:
So it's not that you have somebody standing at the beginning of the recycling process, scanning each individual piece of plastic with, for example, an XRF machine. What happens is the waste goes through the process. At the end, there are representative samples taken of this pelletized recycling material. And before it's allowed to go into the recycling stream, it's tested to determine what the concentration of PBDEs are in that. And I think that the government council's explanation underscores that that was not seriously considered below.

[00:28:41] Speaker 00:
Similarly, a lot of what was just said is a lot of post hoc speculation. There's simply nothing in the record that shows that EPA engaged in the analysis that council suggests that it did. For example, EPA did not analyze whether it would be practicable to reduce exposures from sludge. And it is true that wastewater treatment does take deca-BDE and put it into the sludge. And that is why we said in the administrative proceedings below, that it's a requirement for EPA to do something about that concentration in the sludge.

[00:29:15] Speaker 00:
And we didn't say that EPA needs to treat the sludge, that they need to do some sort of concentration restriction so that that sludge is not going into the environment and going into wastewater and contaminating the wastewater and soil that it's in.

[00:29:34] Speaker 00:
EPA also did not actually analyze how much exposure reduction would happen from recycling restrictions. EPA suggests that only 9% of e-waste has brominated flame retardants, which I think actually underscores how useful this sorting technology that is able to sort technology for brominated flame retardants would be, because it wouldn't mean that the entire recycling stream would be upended. It would mean that a small portion of this could be taken out and sent to incineration with technologies that are able to reduce exposures from that.

[00:30:21] Speaker 00:
Unless the panel has further questions, I would just emphasize that EPA's rule does not actually meaningfully reduce exposure to deca-BDE.

[00:30:30] Speaker 00:
EPA says that it did enough at the upstream stage that it doesn't need to address the vast quantities of DECA BDE that are already in commerce and that have to be disposed of at the end of its useful life. We know that over 100 million pounds are out there, and EPA never assessed the practicability of actually addressing the DECA BDE that is currently in commerce. Instead, it just codified the status quo, and it perpetuates ongoing exposures that will result in irreversible harm to children's brain development and to wildlife that's endangered.

[00:31:06] Speaker 00:
We ask the court to remand the rule to EPA with deadlines so that EPA can finally comply with the law.

[00:31:12] Speaker 04:
Are you asking for vacature?

[00:31:13] Speaker 00:
We are not asking for vacature.

[00:31:15] Speaker 04:
Thank you. Thanks, counsel. Thank all of you for your arguments and for coming out from the East Coast to argue lie. That's much appreciated. And thank you all for your briefing on this case, which was excellent and very helpful to the court. With that, we'll take a 10-minute recess.