Strategic Considerations for Responding to a Clean Air Act 114 Request
In light of EPA’s bold regulatory agenda, data reflecting a decades-long enforcement decline, and recent NGO calls for EPA to step up that enforcement, industry should be prepared for an uptick in Clean Air Act (CAA) Section 114 information requests. CAA 114 broadly authorizes EPA to require a company to provide information it may reasonably require for purposes of: (1) developing a State Implementation Plan (SIP) or promulgating a rule, such as a National Emission Standards for Hazardous Air Pollutants (NESHAP) or a New Source Performance Standards (NSPS); (2) determining compliance; or (3) carrying out a provision the CAA. 42 U.S.C. 7414(a). Information provided in response to a 114 request can be used in an enforcement action and may also be disclosed under the Freedom of Information Act (FOIA) to NGOs, members of the public, plaintiff’s attorneys, state and local agencies, and industry competitors.
We offer ten strategic considerations in responding to a 114 request. While these considerations are tailored to CAA 114’s, many apply to information requests more generally and can be considered for responding to information requests issued under other statutes as well.
1. Involve Legal immediately.
Responding to a 114 request can have significant ramifications on the Company, up to and including criminal prosecution for false statements in the response, and many key legal decisions – such as whether to issue a legal hold and whether to conduct the review under privilege – must be made expeditiously. The company should have a process to ensure that 114 requests are delivered immediately to its legal division.
2. Discern whether the company has received a “rulemaking” or “enforcement” 114.
EPA typically uses its 114 authority to collect information from a company either for determining compliance or for developing policies and rules. The type of 114 can be gleaned from the EPA cover letter describing the purpose of the request and its signatory. Pay close attention to the “purpose” EPA describes because that can help determine how aggressively to assert objections. Requests from enforcement personnel usually lead to Notices of Violation and penalty demands; requests from program and policy personnel will typically be used to support a new or revised rule, although information obtained from a rulemaking 114 can be shared with enforcement staff.
3. Respond by the deadline provided in the 114 – even if the response is not complete.
The 114 is effectively a government subpoena – even when it is a request for information for purposes of rulemaking – and can be enforced if the Company chooses not to comply or replies after the deadline provided. If EPA’s deadlines for response and production cannot be met, inform EPA when the Company can reasonably respond and respond by that deadline. A company can also set forth reasonable rolling deadlines – i.e., providing answers to some questions by the deadline, and other questions later. Alternatively, the Company can choose to negotiate an alternate schedule in advance. In most cases, EPA will accept or agree to reasonable alternative schedules.
4. Carefully review and make efforts to comply with instructions – but object or clarify any interpretive assumptions.
EPA’s authority to seek information is bound by a standard of reasonableness. See, e.g., United States v. Xcel Energy, Inc., 759 F. Supp. 2d 1106, 1114-15 (D. Minn. 2010). Although a successful legal challenge to a 114 is quite difficult (courts have not viewed information requests as final agency actions), it is important to create an administrative record that preserves objections in the event of litigation. Objections are not sufficient in themselves to shield against enforcement or refuse to respond, but they can be used to circumscribe the Company’s reasonable interpretation of the request; outline a reasonable approach and limits to its response; inform EPA of the flaws and ambiguities in its request; negotiate a more reasonable scope; and convey to the Agency that litigation, even if remote, is a possibility. The preparation of objections and interpretive assumptions is akin to preparing a response to discovery responses to interrogatories and requests for production (which is, in essence, what they are). The Company should reserve its right to provide additional objections and explicitly state that it is not waiving any objections.
5. Describe the Company’s scope of review.
Describe the efforts and approach that the Company took to develop its response, for example, where files were searched, what files were reviewed, who (titles or departments) were involved. Just as importantly, be clear about what files were not reviewed and what files were not searched (for example, third parties, public agencies, non-EHS files). Describing the scope of work provides notice to EPA that while the search was robust, it may not have been as wide as EPA might assume was undertaken. This also provides grounds for supplementing documents that may not have been found as part of a more limited search and avoids the perception that documents that are supplemented were intentionally omitted.
6. Reserve the Company’s rights to supplement, amend, withdraw, and correct information.
The 114 likely requests a substantial amount of information in a short period of time and it is likely that the Company (even where it uses outside consultants) will not be able to conduct a QAQC; errors or omissions are possible. Although not within its 114 authority, EPA frequently seeks information that is not kept in the ordinary course of business and will ask the Company to develop new data, prepare complex spreadsheets, calculations, and analyses, or conduct monitoring or testing – in addition to providing documents and responding to narrative questions. The Company can object that the CAA does not require the development of new information the Company is not required to keep or does not maintain in the ordinary course of business. The Company should keep copies of what it has provided to EPA and reserve its rights to withdraw, revise, supplement, and amend its response at any time.
7. Mark all Confidential Business Information (CBI).
Make sure that all company confidential information is marked as CBI at the time of submitting the response. The Company’s 114 response is subject to FOIA. However, only documents that are marked CBI at the time of submission are subject to EPA’s CBI determination procedures (40 C.F.R. Part 2). In some recent 114s, EPA has taken the position that the Company must substantiate its confidentiality claims at the time of submission, or even predesignate some types of information as non-confidential. Companies should object to EPA’s efforts to limit or waive these important procedural rights. CBI claims should focus on specific confidential information and exclude all publicly available information. The Company should also be prepared to support its CBI claim when EPA asks it to do so, as it must in response to a FOIA request by a third party.
8. Be mindful of how information is conveyed and avoid making legal representations.
The Company should avoid or qualify its response to questions that seek legal opinions or compliance representations. For example, a 114 might seek information about whether a certain rule applies, or may use innocuous-sounding terms that have specific defined meanings under the regulations (e.g., “modification”) – and any response to these requests could be viewed as admissions in any subsequent enforcement action. The Company should be careful to clarify that it is not making or waiving representations about applicability or compliance with CAA rules. Where a request is ambiguous, could have multiple interpretations, or calls for judgment, the Company should state specifically how it is interpreting the question, and how it is responding.
9. Carefully evaluate whether signing the certification statement is viable – usually, it is not.
Most 114 requests demand certification by a responsible corporate official as to the truth, accuracy, and completeness of the submission. CAA 114 does not require this certification, and in many instances, there is simply no reasonable way to certify the veracity or completeness of all of the information provided. A general statement that the information is true and accurate to the best of the Company’s knowledge should suffice.
10. Evaluate the information the Company provided in response to the 114.
In the rush to meet the 114 deadlines, it is not always feasible to analyze the implications of what was produced. It is important – while the information is still fresh and before EPA provides additional follow-up – to evaluate what information was provided, where there may be vulnerabilities in the Company’s data, anticipate EPA’s likely questions, and determine whether the data should be corrected or supplemented or whether mitigating actions are appropriate. The Company should also consider potential risks in connection with citizen’s suits or enforcement litigation.
B&D’s cross-disciplinary enforcement practice advises and represents companies in Clean Air Act 114 requests as well as enforcement actions and other engagements with government regulators on air, water, and waste issues. For more information, please contact the authors, see our Air, Enforcement, Water, and Waste practices, or contact your usual B&D contact.