Case 2:21-cv-06341-JAK-MRW Document 1 Filed 08/05/21 Page 1 of 35 Page ID #:1
`
`HOLLAND & KNIGHT LLP
`David A. Robinson, Esq. (SBN 107613)
`david.robinson@hklaw.com
`Marne S. Sussman, Esq. (SBN 273712)
`marne.sussman@hklaw.com
`Emily M. Lieban, Esq. (SBN 303079)
`emily.lieban@hklaw.com
`Nicholas A. Dellefave, Esq. (SBN 323814)
`nicholas.dellefave@hklaw.com
`Three Park Plaza, Suite 1400
`Irvine, CA 92614-8537
`Telephone: 949.833.8550
`Facsimile: 949.833.8540
`
`Attorneys for Plaintiff CALIFORNIA
`TRUCKING ASSOCIATION
`
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`Irvine, CA 92614-8537
`3 Park Plaza, Suite 1400
`Holland & Knight LLP
`
`Fax: 949.833.8540
`Tel: 949.833.8550
`
`UNITED STATES DISTRICT COURT
`FOR THE CENTRAL DISTRICT OF CALIFORNIA
`CALIFORNIA TRUCKING
` Case No.: 2:21-cv-6341
`ASSOCIATION, a California
`
`corporation,
`
`COMPLAINT FOR
`
`DECLARATORY JUDGMENT
`AND INJUNCTIVE RELIEF
`
`
`
`
`
`Plaintiff,
`
`
`
`
`vs.
`
`SOUTH COAST AIR QUALITY
`MANAGEMENT DISTRICT; The
`GOVERNING BOARD OF THE
`SOUTH COAST AIR QUALITY
`MANAGEMENT DISTRICT; and
`DOES 1 through 25, inclusive,
`
`Defendants.
`
`
`
`
`
`
`
`
`- 1 -
`COMPLAINT FOR DECLARATORY JUDGMENT AND INJUNCTIVE RELIEF
`
`

`

`Case 2:21-cv-06341-JAK-MRW Document 1 Filed 08/05/21 Page 2 of 35 Page ID #:2
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`INTRODUCTION
` "The problem is the trucks." — South Coast Air Quality Management
`1.
`District ("District") Governing Board Member Rex Richardson at the May 7, 2021
`hearing on Proposed Rule 2305 – Warehouse Indirect Source Rule – Warehouse
`Actions and Investments to Reduce Emissions Program, and Proposed Rule 316 –
`Fees for Rule 2305 (collectively, "Rule 2305").
`"We all acknowledge trucks are the issue. The type of building the
`2.
`trucks go to or from, the trucks are indifferent. They pollute no matter where they
`go." — District Governing Board Member Janice Rutherford at the May 7, 2021
`hearing on Rule 2305.
`To avoid the balkanization of emissions and regulatory standards across
`3.
`every local jurisdiction, the United States Congress has enacted two sweeping
`preemptions of local rules that could impact the control of emissions from trucks or
`that could impact the price, routes, or services those trucks provide. But faced with
`diminishing returns on its regulation of traditional polluters, looming federal
`deadlines, and nearing the edge of its regulatory authority, the District has flouted
`this prohibition by adopting a regional warehouse regulation that, from its inception,
`has been designed to do only one thing: change the trucks on the road.
`Dissatisfied with the pace of fleet turnover already mandated by the
`4.
`California Air Resources Board ("CARB"), the District has seized for itself powers
`reserved to the United States Environmental Protection Agency ("EPA") and CARB
`under what the United States Supreme Court has already declared to be "Congress's
`carefully calibrated regulatory scheme." Engine Mfrs. Ass'n v. S. Coast Air Quality
`Mgmt. Dist., 541 U.S. 246, 255 (2004). The District now seeks to go where no local
`air district has sought to go before, to implement a rule forcing the marketplace's
`accelerated acquisition and use of zero emission ("ZE") or near zero emission
`("NZE") heavy-duty trucks.
`In so doing, the District has issued "[a] command, accompanied by
`5.
`
`- 2 -
`COMPLAINT FOR DECLARATORY JUDGMENT AND INJUNCTIVE RELIEF
`
`Irvine, CA 92614-8537
`3 Park Plaza, Suite 1400
`Holland & Knight LLP
`
`Fax: 949.833.8540
`Tel: 949.833.8550
`
`

`

`Case 2:21-cv-06341-JAK-MRW Document 1 Filed 08/05/21 Page 3 of 35 Page ID #:3
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`sanctions, that certain purchasers may buy only vehicles with particular emission
`characteristics" previously determined by the United States Supreme Court to be "as
`much a [preempted] 'attempt to enforce' a 'standard' as a command, accompanied by
`sanctions, that a certain percentage of a manufacturer's sales volume must consist of
`such vehicles." Engine Mfrs. Ass'n., 541 U.S. at 255 (italics added). As explained by
`our High Court: "The aggregate effect of allowing every state or political subdivision
`to enact seemingly harmless rules would create an end result [that] would undo
`Congress's carefully calibrated regulatory scheme." Ibid.
`Plaintiff California Trucking Association et al. ("CTA") thus brings this
`6.
`suit to declare void and to permanently enjoin enforcement of Rule 2305.
`The District has long-struggled to achieve state and federal air quality
`7.
`standards by exercising only those powers lawfully granted to it. The District has
`also long-recognized that the majority of its remaining emissions result from
`tailpipes, not smokestacks. But the District has no lawful authority over tailpipes.
`Nonetheless, in an effort to reach those sources, the District has stretched the letter of
`the law to reach far beyond its jurisdiction in order to obtain emission reductions.
`Rule 2305 is nominally styled as a lawful indirect source review ("ISR")
`8.
`rule, but is instead concerned with none of the emissions sources such a review
`normally addresses. While the Clean Air Act ("CAA"), 42 U.S.C. § 7401, et seq.,
`allows EPA to review and approve certain ISR rules promulgated by California's 35
`legislatively created air districts and duly incorporated into California's State
`Implementation Plan ("SIP") by CARB (see 42 U.S.C. § 7410(a)(5), hereinafter
`"CAA § 110"), Rule 2305 is not truly concerned with indirect sources. It does not
`address vehicle trips from workers coming to or leaving the site, the construction
`equipment used in developing new warehouses, the length of trips to and from the
`warehouse, or any direct emissions from the warehouse itself. Rule 2305, by
`necessity and design, is entirely about the trucks.
`Congress has expressly preempted state and local rules that "relate to"
`9.
`
`- 3 -
`COMPLAINT FOR DECLARATORY JUDGMENT AND INJUNCTIVE RELIEF
`
`Irvine, CA 92614-8537
`3 Park Plaza, Suite 1400
`Holland & Knight LLP
`
`Fax: 949.833.8540
`Tel: 949.833.8550
`
`

`

`Case 2:21-cv-06341-JAK-MRW Document 1 Filed 08/05/21 Page 4 of 35 Page ID #:4
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`the control of emissions from new motor vehicles and state and local rules that "relate
`to" a price, route, or service of any motor carrier. 42 U.S.C. § 7543(a) ("CAA §
`209"); Federal Aviation Administration Authorization Act of 1994 ("FAAAA"), 49
`U.S.C. § 14501(c)(1).
`10. The CAA sets up a comprehensive federal regime via which EPA
`regulates emissions. Section 202(a)(1) of the CAA directs EPA to "prescribe . . .
`standards applicable to the emission of any air pollutant from any class or classes of
`new motor vehicles or new motor vehicle engines." "Because the regulation of
`mobile source emissions is a federal responsibility, Congress has expressly
`preempted states from setting emissions standards for mobile sources…." Jensen
`Family Farms, Inc. v. Monterey Bay Unified Air Pollution Control Dist., 644 F.3d
`934, 939 (9th Cir. 2011) (citing CAA § 209(a)). According to the United States
`Supreme Court, "[t]he language of [the CAA] is categorical." Engine Mfrs. Ass'n, 541
`U.S. at 256. There is no exception for the indirect regulation the District purports to
`undertake.
`11. Like the CAA, the FAAAA is a comprehensive law with strong
`preemptive power. The FAAAA's purpose is to "'prevent States from undermining
`federal regulation of interstate trucking' through a 'patchwork' of state regulations."
`Am. Trucking Ass'ns v. City of Los Angeles, 660 F.3d 384, 395-96 (9th Cir. 2011),
`rev'd on other grounds, 569 U.S. 641 (2013). The FAAAA's express-preemption
`provision prohibits the State of California or any subdivision thereof from making,
`applying, or enforcing laws "related to a price, route, or service of any motor carrier
`… or any private carrier, broker, or freight forwarder with respect to the
`transportation of property." 49 U.S.C. § 14501(c)(1). Rule 2305 creates precisely the
`type of patchwork the FAAAA was designed to avoid as motor carriers must modify
`their services and routes to support ZE/NZE vehicles or even entirely relocate. If
`every local jurisdiction enacted its own version of Rule 2305, the impact on the
`nation's logistics industry would be nothing short of disastrous.
`
`- 4 -
`COMPLAINT FOR DECLARATORY JUDGMENT AND INJUNCTIVE RELIEF
`
`Irvine, CA 92614-8537
`3 Park Plaza, Suite 1400
`Holland & Knight LLP
`
`Fax: 949.833.8540
`Tel: 949.833.8550
`
`

`

`Case 2:21-cv-06341-JAK-MRW Document 1 Filed 08/05/21 Page 5 of 35 Page ID #:5
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`12. Because Rule 2305 has the purpose and effect of interfering with
`interstate freight operations, facilities and equipment on an intra-state, sub-regional
`basis, it is both expressly and impliedly preempted by the CAA, 42 U.S.C. § 7401, et
`seq., and the FAAAA, 49 U.S.C. § 14501; as explained below, it exceeds the
`District's limited authority to adopt ISR rules under the California Health and Safety
`Code, § 40000, et seq.; and it constitutes an unlawful tax adopted in contravention of
`the California Constitution Art. XIII C, § 1(e).
`THE PARTIES
`13. Plaintiff California Trucking Association ("CTA") is an association
`devoted to advancing the interests of its motor-carrier members, which include
`warehouse owners and operators, who provide transportation services in California.
`CTA promotes advocacy, safety and compliance with all applicable state and federal
`laws on behalf of its members, including motor-carrier members operating in
`California.
` CTA members are licensed motor-carrier companies and warehouse
`14.
`owners or operators that manage, coordinate, and schedule the movement of property
`throughout California in interstate commerce. Many of CTA's members are based in
`this judicial district, and many other CTA members are based elsewhere but provide
`transportation services in this judicial district. Many of CTA's motor-carrier
`members contract with warehouse owner-operators to provide interstate trucking
`services to their customers in and between several states, including California. Other
`CTA members are themselves owners or operators of warehouses directly regulated
`by Rule 2305. CTA also expends significant resources to ensure that its members,
`and the governmental agencies that regulate them, understand and faithfully
`implement the goals and requirements of all applicable laws and regulations,
`including Rule 2305. The activities of CTA's members are subject to regulation
`under Rule 2305, and the injuries they have suffered and will suffer under Rule 2305
`can only be redressed by this Court's order setting aside this illegal rule and enjoining
`
`- 5 -
`COMPLAINT FOR DECLARATORY JUDGMENT AND INJUNCTIVE RELIEF
`
`Irvine, CA 92614-8537
`3 Park Plaza, Suite 1400
`Holland & Knight LLP
`
`Fax: 949.833.8540
`Tel: 949.833.8550
`
`

`

`Case 2:21-cv-06341-JAK-MRW Document 1 Filed 08/05/21 Page 6 of 35 Page ID #:6
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`its enforcement.
`15. Defendant District is a political subdivision of California responsible for
`air pollution control in counties that include the Los Angeles metropolitan area. Its
`authority is defined, and circumscribed, by enabling legislation found at California
`Health & Safety Code § 40400, et seq., aka the "Lewis-Presley Air Quality
`Management Act." Under California law, the District has the authority to sue and be
`sued in the name of the District in all actions and proceedings in all courts and
`tribunals of competent jurisdiction. Cal. Health & Safety Code § 40701. Agents of
`the District are responsible for administering Rule 2305.
`16. Defendant members of the District Governing Board are all residents of
`the State of California.
`
`JURISDICTION AND VENUE
`17. The claims asserted herein arise under, inter alia, the CAA, 42 U.S.C.
`§ 7401, et seq., the FAAAA, 49 U.S.C. § 14501, and Article VI of the United States
`Constitution. Thus, this Court has federal question jurisdiction over this action
`pursuant to 28 U.S.C. § 1331.
`18. Pursuant to 28 U.S.C. § 167, this Court may exercise supplemental
`jurisdiction over CTA's claims that the District's adoption of the regulations at issue
`was not an authorized exercise of its regulatory power under the California Health &
`Safety Code and imposes an unauthorized tax.
`19. The Court may issue declaratory judgment and appropriate relief in this
`matter pursuant to 28 U.S.C. §§ 2201-2202.
`20. Venue in this district is appropriate pursuant to 29 U.S.C. § 1391(b), as
`the South Coast District's headquarters are located in the Western Division of the
`Central District of California and the South Coast District's contested Rule 2305, the
`subject of this action, pertains to warehouses and commercial truck fleets operating,
`and the movement of goods for sale transported by those trucks, in the Western
`Division of the Central District of California.
`
`- 6 -
`COMPLAINT FOR DECLARATORY JUDGMENT AND INJUNCTIVE RELIEF
`
`Irvine, CA 92614-8537
`3 Park Plaza, Suite 1400
`Holland & Knight LLP
`
`Fax: 949.833.8540
`Tel: 949.833.8550
`
`

`

`Case 2:21-cv-06341-JAK-MRW Document 1 Filed 08/05/21 Page 7 of 35 Page ID #:7
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`STATEMENT OF FACTS
`
`I. The Clean Air Act
`21. Enacted in 1970, the CAA is a comprehensive federal law which
`regulates air quality. Section 202(a)(1) of the CAA directs EPA to "prescribe . . .
`standards applicable to the emission of any air pollutant from any class or classes of
`new motor vehicles or new motor vehicle engines." The EPA is also responsible for
`certifying that new motor vehicle engines comply with applicable standards and
`regulations under the CAA. Ibid.
`22. The CAA makes "the States and the Federal Government partners in the
`struggle against air pollution." General Motors Corp. v. United States, 496 U.S. 530,
`532 (1990). The direct regulation of emissions from stationary sources is primarily
`left to the states (42 U.S.C. § 7416, hereinafter "CAA § 116"; see also Engine Mfrs.
`Ass'n, ex rel. Certain of its Members v. United States EPA, 88 F.3d 1075, 1079
`(1996) (describing a "history of detailed state regulation of stationary sources")),
`while the federal government sets nationwide emissions standards for mobile sources.
`The category of "mobile sources" includes both motor vehicles ("onroad") and
`"nonroad" sources. See CAA § 202 (giving the EPA Administrator authority to set
`emission standards for new motor vehicles); 42 U.S.C. § 7547 ("CAA § 213") (same
`for nonroad sources).
`23. The CAA regulates mobile sources through both direct emissions
`standards for motor vehicles and engines, and fuel composition requirements for the
`fuels combusted in these engines. 42 U.S.C. §§ 7521-7544 ("CAA §§ 202-210")
`(engine standards), §§ 7545-7549 ("CAA §§ 211-215") (fuels standards). Mobile
`sources are not, however, regulated under the stationary source programs, even when
`used in a stationary manner (e.g., stationary internal combustion engines). 42 U.S.C.
`§§ 7411(a)(3), 7602(z) ("CAA §§ 111(a)(3), 302(z)").
`24. Because the regulation of mobile source emissions is a federal
`responsibility, Congress has expressly preempted states from setting emissions
`
`- 7 -
`COMPLAINT FOR DECLARATORY JUDGMENT AND INJUNCTIVE RELIEF
`
`Irvine, CA 92614-8537
`3 Park Plaza, Suite 1400
`Holland & Knight LLP
`
`Fax: 949.833.8540
`Tel: 949.833.8550
`
`

`

`Case 2:21-cv-06341-JAK-MRW Document 1 Filed 08/05/21 Page 8 of 35 Page ID #:8
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`"standards" for mobile sources. CAA § 209(a) (preempting state regulation of new
`motor vehicle emissions).
`25. According to the United States Supreme Court, the term "standard"
`broadly includes that which was "established by authority, custom, or general
`consent, as a model or example; criterion; test." Engine Mfrs. Ass'n., 541 U.S. at
`252-53 (opn. by J. Thomas striking down as preempted an earlier District rule that, as
`here, used fees or economic sanctions to effectively coerce the purchase of lower
`emission vehicles); see also Metropolitan Taxicab Bd. of Trade v. City of New York,
`633 F. Supp. 2d 83, 100 (S.D.N.Y., 2009) ("Metropolitan Taxicab") (holding that a
`New York City rule increasing the maximum allowable taxi lease rate in order to
`coerce taxi owners to purchase hybrid vehicles by rendering conventional fleets
`substantially less profitable than hybrid fleets was, in fact, a preempted state or local
`"mandate to switch to hybrid vehicles").
`26. Under CAA § 209(b), California can seek EPA approval for a waiver of
`preemption to adopt its own mobile source emissions standards, provided they are at
`least as protective of health and welfare as federal standards. The CARB, as the state
`agency designated "the air pollution control agency for all purposes set forth in
`federal law" (Cal. Health & Safety Code § 39602), is the agency responsible for
`applying for such a waiver.
`27. Section 110(a)(1) of the CAA, entitled "State implementation plans for
`national primary and secondary ambient air quality standards" mandates, and
`prescribes a procedure for, each states' submission of "a [SIP] which provides for
`implementation, maintenance, and enforcement of such primary standard in each air
`quality control region (or portion thereof) within such State" within 3 years or less
`after "the promulgation of a national primary ambient air quality standard (or any
`revision thereof) under section 109." It also establishes a procedure for the EPA
`Administrator's review and approval of such SIPs. These SIPs explain how each
`state, and within California how each air district, intends to comply with the national
`
`- 8 -
`COMPLAINT FOR DECLARATORY JUDGMENT AND INJUNCTIVE RELIEF
`
`Irvine, CA 92614-8537
`3 Park Plaza, Suite 1400
`Holland & Knight LLP
`
`Fax: 949.833.8540
`Tel: 949.833.8550
`
`

`

`Case 2:21-cv-06341-JAK-MRW Document 1 Filed 08/05/21 Page 9 of 35 Page ID #:9
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`ambient air quality standards.
`II. Air Quality Regulation in California
`28. The CARB, or "the state board," is the agency that California law
`designates as "the air pollution control agency for all purposes set forth in federal
`law." Cal. Health & Safety Code § 39602. The CARB's statutory mandate includes
`"preparation of the [SIP] required by the [CAA] …" and coordination "of the
`activities of all districts necessary to comply" with the CAA and SIP. Ibid.
`29. The "districts" with whom CARB is required to coordinate are those
`"created or continued in existence pursuant to … [Health & Safety Code s]ection
`40000." Cal. Health & Safety Code § 39025. The District is one of 35 such districts
`throughout the state. The District is responsible for developing and implementing a
`"comprehensive basinwide air quality management plan" to reduce emission levels
`and thereby achieve and maintain "state and federal ambient air quality standards."
`Cal. Health & Safety Code § 40402(e). The District is authorized to "adopt rules and
`regulations that carry out the [P]lan and are not in conflict with state law and federal
`laws and rules and regulations." Cal. Health & Safety Code § 40440 (italics added).
`Any rules and regulations promulgated by the District must "conform to the [SIP]."
`Ibid.
`
`30. The California Legislature has found and declared that "local and
`regional authorities have the primary responsibility for control of air pollution from
`all sources, other than emissions from motor vehicles. The control of emissions from
`motor vehicles, except as otherwise provided in this division, shall be the
`responsibility of the state board." Cal. Health & Safety Code § 40000 (italics added);
`see also Health & Safety Code §§ 39002, 43000.5, 43013, 43018(b) and (d). Under
`state law, CARB and the air districts are each charged with regulating particular
`sources of air pollution.
`
`
`
`- 9 -
`COMPLAINT FOR DECLARATORY JUDGMENT AND INJUNCTIVE RELIEF
`
`Irvine, CA 92614-8537
`3 Park Plaza, Suite 1400
`Holland & Knight LLP
`
`Fax: 949.833.8540
`Tel: 949.833.8550
`
`

`

`Case 2:21-cv-06341-JAK-MRW Document 1 Filed 08/05/21 Page 10 of 35 Page ID #:10
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`III.
`
`Indirect Source Review Authority
`"Indirect sources" are neither stationary sources nor mobile sources, but
`31.
`are facilities which, by their nature "attract[], or may attract, mobile sources of
`pollution." CAA § 110(a)(5)(C). Typical indirect sources include shopping centers,
`stadiums, and other places of public assembly. The CAA provides that states may,
`but are not required to, adopt an ISR program as part of their SIPs. Id. at (a)(5)(A).
`The CAA defines ISR programs to mean "the facility-by-facility review of indirect
`sources of air pollution, including such measures as are necessary to assure, or assist
`in assuring, that a new or modified indirect source will not attract mobile sources of
`air pollution, the emissions from which would cause or contribute to air pollution
`concentrations exceeding any national primary ambient air quality standard…." Id. at
`(a)(5)(D) (italics added).
`32. An ISR is "an environmental review process encompassing air pollution,
`land use decisions and individual usage of the automobile .... ISR can serve as a tool
`for evaluating a land development project's effects on automobile usage and the
`resulting air quality effects of such increased vehicle usage."1
`33. Echoing the provisions of CAA § 110(a)(5), California's Health &
`Safety Code § 40716 gives California air districts generally the authority to adopt and
`implement regulations to "[r]educe or mitigate emissions from indirect and areawide
`sources of air pollution" and "[e]ncourage or require the use of measures which
`reduce the number or length of vehicle trips." However, subsection (b) expressly
`stipulates "[n]othing in this section constitutes an infringement on the existing
`authority of counties and cities to plan or control land use, and nothing in this
`section provides or transfers new authority over such land use to a district" (italics
`added).
`34. Similarly, Health & Safety Code § 40440 gives the District specifically
`
`
`1 Phillip E. Rothschild, The Clean Air Act and Indirect Source Review: 1970-1991, 10
`UCLA J. ENVTL. L. & POL'Y 337 (1992), https://escholarship.org/uc/item/71q986z0.
`- 10 -
`COMPLAINT FOR DECLARATORY JUDGMENT AND INJUNCTIVE RELIEF
`
`Irvine, CA 92614-8537
`3 Park Plaza, Suite 1400
`Holland & Knight LLP
`
`Fax: 949.833.8540
`Tel: 949.833.8550
`
`

`

`Case 2:21-cv-06341-JAK-MRW Document 1 Filed 08/05/21 Page 11 of 35 Page ID #:11
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`authority to "provide for indirect source controls in those areas of the south coast
`district in which there are high-level, localized concentrations of pollutants or with
`respect to any new source that will have a significant effect on air quality in the South
`Coast Air Basin," but only to the extent such indirect source controls or ISR
`regulations are "consistent" with the mandates of Health & Safety Code § 40414.
`Health & Safety Code § 40414, in turn, provides indirect source controls shall not
`"constitute an infringement on the existing authority of counties and cities to plan or
`control land use, and no provision of this chapter shall be interpreted as providing or
`transferring new authority over such land use to either the south coast district, the
`Southern California Association of Governments, or the state board" (italics added).
`35. These provisions were not enacted in a vacuum. In authorizing the air
`districts to implement ISR rules, the Legislature "was aware of the congressional
`objections to indirect source review when it provided specific authorization in section
`40716" and designed the provision to be "reflective of Congress' aversion to placing
`an undue regulatory burden on indirect source." 75 Op. Cal. Att'y Gen. 256 (1993).
`The authorization to the District was provided against the backdrop of federal law,
`which had created a vernacular describing categories of indirect sources, how and
`when they could be reviewed, and the bounds of the controls that could be imposed
`on them.
`36. Accordingly, both as a matter of state and superseding federal law, the
`District's purported authority to promulgate and enforce indirect source controls or
`ISR regulations is expressly limited in the following respects:
`Under California law,
`• The District has authority to regulate only "new" sources or to regulate
`in areas of the District with demonstrated high-level localized
`concentrations of pollutants,
`• No ISR may "infringe" on land use or control, assess the equivalent of
`an operational permit, nor confer upon the District or CARB "new
`
`- 11 -
`COMPLAINT FOR DECLARATORY JUDGMENT AND INJUNCTIVE RELIEF
`
`Irvine, CA 92614-8537
`3 Park Plaza, Suite 1400
`Holland & Knight LLP
`
`Fax: 949.833.8540
`Tel: 949.833.8550
`
`

`

`Case 2:21-cv-06341-JAK-MRW Document 1 Filed 08/05/21 Page 12 of 35 Page ID #:12
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`authority" with respect to land use or control, and
`• No ISR can be contrary to federal law, e.g., violate either the
`"categorical" preemption of CAA § 209(a) or the broad preemption of
`the FAAAA.
`Under the CAA,
`• No ISR can have as its principal purpose or effect (aka "domain," see
`Medtronic, Inc. v. Lohr, 518 U.S. 470, 484 (1996)) the attempted
`adoption or enforcement of any standard—e.g., here ZE or NZE—
`relating to the control of emissions from new motor vehicles.
`37. Yet, as explained below, Rule 2305 transgresses all of these
`prohibitions.
`IV. Control of Mobile Source Emissions in California
`38. The CARB has exercised its exclusive authority over mobile sources
`zealously. On June 25, 2020, CARB passed the Advanced Clean Trucks rule
`("ACT"). The ACT requires medium and heavy-duty vehicle manufacturers to sell
`ZE vehicles as a certain percentage of sales, beginning with the 2024 vehicle model
`year. The ACT phases in over a period of 10 years, culminating in 2035 with a
`requirement that ZE trucks and tractors comprise 55% of all Class 2b-3, 75% of all
`Class 4-8, and 40% of all Class 7-8 trucks and tractors sold each year.
`39. To address emissions associated with the remaining conventional
`medium and heavy-duty diesel trucks, CARB adopted the Heavy Duty Engine and
`Vehicle Omnibus Regulation, often referred to as the "Low NOx Omnibus." This
`complex regulation requires, among other things, further reductions of oxides of
`nitrogen ("NOx") emissions from heavy-duty on-road engines, to be phased-in
`beginning in 2024, overhauls engine testing procedures, and extends engine useful
`life and warranty periods in order to secure durable emissions reductions.
`40. Having mandated that manufacturers provide cleaner vehicles, CARB
`more recently has turned its attention to the "buy side," with the introduction of its
`
`- 12 -
`COMPLAINT FOR DECLARATORY JUDGMENT AND INJUNCTIVE RELIEF
`
`Irvine, CA 92614-8537
`3 Park Plaza, Suite 1400
`Holland & Knight LLP
`
`Fax: 949.833.8540
`Tel: 949.833.8550
`
`

`

`Case 2:21-cv-06341-JAK-MRW Document 1 Filed 08/05/21 Page 13 of 35 Page ID #:13
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`proposed Advanced Clean Fleet rule ("ACF"). The ACF, slated for an initial public
`hearing in December 2021, proposes to require that a certain percentage of vehicles
`acquired by fleets be ZE. For example, the ACF proposes that 50% of public fleet
`vehicle purchases for model years 2024 to 2026 must be ZE, ramping up to 100% in
`2027. If adopted, the ACF will become effective for certain fleets in 2024 and phase
`in over time with the goal of a zero-emission truck and bus fleet by 2045 everywhere
`feasible, and significantly earlier for certain market segments such as last mile
`delivery and drayage applications.
`41. Despite these diligent efforts, the District has made no secret of its
`dissatisfaction with the perceived slow pace of CARB's rulemaking and decision to
`gradually mandate the conversion of billions of dollars-worth of existing medium and
`heavy-duty trucks transporting goods. In its comment letter on the Draft Mobile
`Source Strategy ("MSS"), the District called on CARB to "go even further" since it
`felt that CARB's efforts to regulate mobile sources were insufficient to meet
`upcoming 2023 and 2031 federal deadlines for ozone reduction.2 In commenting on
`the ACT, the District explained the 15% ZEV sales requirement in 2030 "will be
`insufficient and must be increased to generate the needed NOx reductions."3
`42. But CARB has persisted in taking a measured approach to the regulation
`of mobile sources, declining to require a higher sales percentage "due to concerns
`about the feasibility of manufacturers to comply with even higher sales requirements
`especially for Class 2b-3 vehicles and tractors."4 In other words, CARB, in
`accordance with its statutory mandate, has responsibly weighed competing public
`
`
`2 South Coast Air Quality Management District, Final Staff Report—Proposed Rule
`2305 and Proposed Rule 316 (May 2021), at 52, www.aqmd.gov/docs/default-
`source/Agendas/Governing-Board/2021/2021-May7-027.pdf?sfvrsn=10.
`3 South Coast Air Quality Management District Letter to CARB, Comment Letter on
`Proposed Advanced Clean Trucks Regulation (Dec. 6, 2019),
`https://www.arb.ca.gov/lists/com-attach/60-act2019-VzYHYlciWVUBZFM8.pdf.
`4 Advanced Clean Trucks Regulation, Final Statement of Reasons (January 2021), at
`99, https://ww3.arb.ca.gov/regact/2019/act2019/fsor.pdf.
`- 13 -
`COMPLAINT FOR DECLARATORY JUDGMENT AND INJUNCTIVE RELIEF
`
`Irvine, CA 92614-8537
`3 Park Plaza, Suite 1400
`Holland & Knight LLP
`
`Fax: 949.833.8540
`Tel: 949.833.8550
`
`

`

`Case 2:21-cv-06341-JAK-MRW Document 1 Filed 08/05/21 Page 14 of 35 Page ID #:14
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`policy interests and made a decision with which the District disagrees. Local
`officials do not, however, have the right to "undo Congress's carefully calibrated
`regulatory scheme" simply because they disagree.
`V. The Origin of the District's Unlawful ISR
`43. The District is responsible for air quality in the South Coast Basin, an
`area of approximately 10,743 square miles including all of Orange County and the
`non-desert portions of Los Angeles, Riverside and San Bernardino Counties. The
`Basin is home to the "megaports" of Los Angeles and Long Beach (San Pedro), the
`origin points for 40 percent of all container cargo traffic in the United States, and a
`well-developed logistics system designed to disseminate those goods across the
`region, state, and nation.
`44. There are over 2,600 warehouses located within the District comprising
`over 662 million square feet of rentable building area. The District's own consultant
`estimates that of all of the goods passing through these warehouses, barely a quarter
`both originate in and are destined for use within the District.5 The remainder is
`transported to or from areas beyond the District's reach, e.g., to Northern California,
`other states, and nations. More specifically, the District's own staff have asserted that
`41 percent of goods warehoused in the District are intended for national distribution.6
`45. The warehouses and distribution centers located in the District are not
`simply participants in, but essential components of, interstate and international
`commerce.
`46. Air quality in the South Coast Basi