Judge Cain's Ruling Against EPA

Case 2:23-cv-00692-JDC-TPL Document 48 Filed 01/23/24 Page 1 of 77 PageID #: 2997
UNITED STATES DISTRICT COURT

WESTERN DISTRICT OF LOUISIANA
LAKE CHARLES DIVISION
STATE OF LOUISIANA CASE NO. 2:23-CV-00692
VERSUS JUDGE JAMES D. CAIN, JR.
U S ENVIRONMENTAL PROTECTION MAGISTRATE JUDGE LEBLANC

AGENCY ET AL
MEMORANDUM RULING
Before the Court is the “State of Louisiana’s Motion for Preliminary Injunction and
to Expedite” (Doc. 10), filed by and through the State of Louisiana’s Attorney General, Liz
Murrill, who moves for an order under Federal Rule of Civil Procedure 65 for a preliminary
injunction against Defendants, the United States Environment Protection Agency (“EPA”),
Michael Regan, Lilian Dorka, U S Department of Justice (“DOJ”), and Merrick Garland,
United States of America. The State of Louisiana alleges that Defendants’ actions violate
the Constitution, Title VI of the Civil Rights Act of 1964, 42 U.S.C. § 2000d et seq. (“Title
VI”) and the Administrative Procedures Act (“APA”).
Specifically, the State seeks to enjoin Defendants from (1) delegating to any private
person or group (including Special Interest Groups) any power to veto governmental
actions of EPA, including extensions of the time to resolve Title VI complaints informally
beyond 180 days after filing of complaints, for all Title VI enforcement actions involving
the State or any State agency, (2) imposing or enforcing any disparate-impact-based
requirements against the State or any State agency under Title VI, and (3) imposing or
enforcing any Title VI-based requirements upon the State or any State agency that are not
both (a) ratified by the President, as required by 42 U.S.C. § 2000d-1, and (b) based upon
requirements found within the four corners of EPA’s disparate-impact regulations, 40
C.F.R. § 7.35(b), (c).
Also, before the Court is “Defendants’ Cross-Motion to Dismiss or, in the
Alternative, for Summary Judgment” (Doc. 29) wherein Defendants move to dismiss the
instant lawsuit for lack of jurisdiction, or alternatively, because there is no genuine issue
of material fact in dispute and Defendants are entitled to judgment as a matter of law.
Finally, before the Court is “Louisiana’s Request for Judicial Notice” (Doc. 39)
wherein the State of Louisiana requests that the Court take judicial notice of the EPA’s
October 3, 2023, acceptance for investigation of a Title VI complaint alleging only
disparate impact by facially non-discriminatory policies.
The Court heard arguments as to these motions on January 9, 2024.
INTRODUCTION
In this lawsuit, the State of Louisiana complains that the EPA seeks to impose
disparate-impact-based requirements that effectively require racial discrimination. The
State asserts that the EPA has weaponized Title VI as a blanket grant of authority to veto
any and all permitting decisions that offend its vision of environmental justice and
“equity.” The State contends that the EPA has no authority to impose these disparate-
impact-based mandates under Title VI because Title VI has no such disparate-impact
language. In other words, Title VI only prohibits intentional discrimination. So, the simple
question here is whether Title VI disparate-impact regulations are lawful. Moreover, does
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the Executive’s limited authority under § 602 of Title VI 1 extend to imposing disparate-
impact-based liability.
Section 601 of Title VI provides:
No person in the United States shall, on the ground of race, color, or national
origin, be excluded from participation in, be denied the benefits of, or be
subjected to discrimination under any program or activity receiving Federal
financial assistance.
42 U.S.C. § 2000d. Of note, agencies’ rulemaking power is limited to actions that
“effectuate” Section 601, and “no such rule, regulation, or order shall become effective
unless and until approved by the President. Id. Section 602 of Title VI authorizes agencies,
such as the EPA, to implement § 601 on intentional racial discrimination in federally-
funded programs. The statute details the precise circumstances by which agencies can seek
compliance with their rules and regulations through fund termination or “other means
authorized by law.” 42 U.S.C. § 2000d-1. The statute provides for judicial review of any
“agency action taken pursuant to [42 U.S.C.] section 2000d-1,” including any agency effort
to enforce its regulations by “terminating or refusing to grant or to continue financial
assistance upon a finding of failure to comply with any [section 2000d-1] requirement. 42
U.S.C. 2000d-2.
The DOJ has adopted regulations to implement Title VI under Section 602. See 28
C.F.R. §§ 41.101-12. DOJ’s published regulations purport to impose disparate-impact-
1
Section 602 governs enforcement and rulemaking. Under § 602, agencies are “authorized and directed to effectuate
the provisions of [601] . . . by issuing rules, regulations, or orders of general applicability which shall be consistent
with achievement of the objectives of the statute authorizing the financial assistance in connection with which the
action is taken.” 42 U.S.C. § 2000d-1.
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based requirements. See, e.g., 28 C.F.R. § 42.104(b)(2). In 2003, DOJ acknowledged that
“the Supreme Court’s statements in Sandoval … call the validity of the Title VI disparate
impact regulations into question.” 68 Fed. Reg. at 51,338; Alexander v. Sandoval, 532 U.S.
275, 280-81 (2001) (holding that a private plaintiff could not bring a Title VI action to
enforce the Department’s implementing regulation prohibiting unintentional
discriminatory effect or disparate impact because the statutory provisions of Title VI
prohibited only intentional discrimination.). 2 The DOJ acted to rescind its disparate impact
regulations in 2020, 3 but inexplicably never published its decision to do so.
The EPA also adopted regulations to implement Title VI. See 40 C.F.R. §§ 7.10-
180. Like DOJ’s regulations, EPA’s regulations contain a restriction on taking actions with
disparate impacts. See 40 C.F.R. § 7.35(b), (c). Although the text of EPA’s regulations
does not mention any particular disparate impact standard, EPA has interpreted its
regulations as establishing a standard that is largely identical to the Title VII disparate-
impact regime established by 42 U.S.C. § 2000e–2(k). 4 EPA adopted that interpretation
despite having joined DOJ in acknowledging that Sandoval “call[s] the validity of … Title
VI disparate impact regulations into question.” 68 Fed. Reg. at 51,338.
FACTUAL STATEMENT
2
The Supreme Court wrote that it assumed that the disparate impact regulation was valid but noted that there was
“considerable tension” with its Title VI precedents. Sandoval, 532 U.S. at 281-82, 284-85.
3
Exhibit 36.
4
Exhibit 40, p. 11.
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Shortly after Title VI was enacted in 1964, a Presidential task force and the
Department of Justice (DOJ) drafted model Title VI regulations. See 45 CFR § 80.3 (1964).
These model regulations included a provision that recipients of federal funds may not use
“criteria or methods of administration which have the effect of subjecting individuals to
discrimination” on the basis of race, color, or national origin.” See id. § 80.3(b)(2) (1964)
(emphasis added).
In 1966, DOJ promulgated its own Title VI regulations with presidential approval.
See Nondiscrimination in Federally Assisted Programs—Implementation of Title VI of the
Civil Rights Act of 1964, 31 Fed. Reg. 10265 (July 29, 1966) (Administrative Record
(“AR”) 1-5). In 1973, the Environmental Protection Agency (EPA) promulgated its own
Title VI regulations with presidential approval. See Nondiscrimination Programs
Receiving Federal Assistance from the Environmental Protection Agency, 38 Fed. Reg.
17,968 (July 5, 1973) (AR286-90).
Both agencies’ regulations prohibited recipients of federal financial assistance from
administering programs in a manner that has the effect of subjecting individuals to
discrimination based on race, color, or national origin. See Nondiscrimination in Federally
Assisted Programs—Implementation of Title VI of the Civil Rights Act of 1964, 31 Fed.
Reg. 10265 (July 29, 1966) (DOJ) (AR-15); Nondiscrimination Programs Receiving
Federal Assistance from the Environmental Protection Agency, 38 Fed. Reg. 17,968 (July
5, 1973) (EPA) (AR286-90). Both the EPA and DOJ have periodically amended their
regulations.
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In 2020, DOJ considered a draft rulemaking that would have sought to eliminate
disparate impact requirements from its Title VI regulations. AR277. Although DOJ
submitted a draft Title VI rulemaking for review to the Office of Management and Budget
(OMB) on December 21, 2020, Id., shortly thereafter, on January 14, 2021, DOJ notified
OMB that the Department had decided not to proceed with publication of that rule and
requested an end to OMB’s review, AR279. The draft rule was never filed for public
inspection with the Office of the Federal Register and was never published in the Federal
Register. See AR279-80.
Since 1988, EPA has provided more than one billion dollars in federal financial
assistance through annual funding grants to the Louisiana Department of Environmental
Quality (LDEQ) and the Louisiana Department of Health (LDH). Declaration of
Christopher Watkins (“Watkins Decl.”) ¶ 4. Current grants total $120,238,571 and at least
16 grant applications are pending. Id. ¶ 5.
LDEQ and LDH are required to certify, and have certified, their compliance with
Title VI and the EPA’s regulations implementing Title VI when they apply for and receive
federal financial assistance from EPA, Id. ¶¶ 5-11, which the State posits, necessarily
means that the State is an “object” of those regulations for purposes of Article III standing.
In 1984, EPA began requiring that applicants for federal funding assistance submit
a signed EPA Form 4700-4. Id. ¶ 11. All applications for federal financial assistance by
LDEQ, LDH, or the State of Louisiana since 1984 were required to contain a completed
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and signed Form 4700-4, which contains certifications that the funding recipient will fully
comply with all applicable civil rights statutes and EPA regulations. Id.
As the discriminatory-effect provisions of EPA’s Title VI regulations have
remained unchanged in substance for decades since 1984, LDEQ, LDH, and the State of
Louisiana have certified with every application for federal financial assistance, including
those made by LDEQ in June 2023, and by LDH in July 2023, that they will comply with
the discriminatory-effect provisions of EPA’s Title VI regulations. Id. ¶¶ 8-11.
On January 20, 2022, EPA’s Office of External Civil Rights Compliance (OECRC)
received: (1) the complaint subsequently docketed as EPA Complaint No. 01R-22-R6,
titled “Complaint Under Title VI of the Civil Rights Act of 1964, 42 U.S.C. § 2000d,
Regarding Civil Rights Violations by Louisiana State Agency Grantees and Environmental
Injustice in St. John the Baptist Parish”; and (2) the complaint subsequently docketed as
EPA Complaint No. 02R-22-R6, titled “Complaint Under Title VI of the Civil Rights Act
of 1964, 42 U.S.C. § 2000d, Regarding Civil Rights Violations by Louisiana State Agency
Grantees and Environmental Injustice in St. John the Baptist Parish.” Declaration of
Anhthu Hoang (“Hoang Decl.”) ¶¶ 6-7.
On February 1, 2022, EPA’s OECRC received the complaint docketed as EPA
Complaint No. 04R-22-R6, titled “Complaint Under Title VI of the Civil Rights Act of
1964, 42 U.S.C. § 2000d, and 40 C.F.R. Part 7 against the “Louisiana Department of
Environmental Quality for Lack of Environmental Justice Procedures in its Air Permitting
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Program and Resulting Discriminatory Decision on Formosa Air Permits.” Hoang Decl. ¶
8.
On April 6, 2022, EPA’s OECRC initiated: (1) an investigation of Complaint Nos.
01R-22-R6 and 04R-22-R6, which were filed against LDEQ; and (2) an investigation of
Complaint No. 02R-22-R6, which was filed against LDH. Hoang Decl. ¶¶ 9-10. On June
27, 2023, EPA’s OECRC issued a letter to LDEQ administratively closing EPA Complaint
Nos. 01R-22-R6 and 04R-22-R6 stating that “[a]s a result of its administrative closure,
EPA will not initiate under Title VI or other civil rights laws any further action,
enforcement or otherwise, in response to these Complaints.”
Also on June 27, 2023, OECRC issued a letter to LDH administratively closing EPA
Complaint No. 02-22-R6, stating that “[a]s a result of its administrative closure, EPA will
not initiate under Title VI or other civil rights law any further action, enforcement or
otherwise, in response to this Complaint.”
On July 17, 2023, EPA rejected a Title VI Complaint (EPA Complaint No. 02R-23-
R6) against LDEQ (Town of Mansura) that EPA received on December 16, 2022. Hoang
Decl. ¶ 20. On July 28, 2023, EPA rejected a Title VI Complaint (EPA Complaint No.
07RNO-23- R6) against LDEQ that EPA received on May 31, 2023. Hoang Decl. ¶ 21.
As of August 15, 2022, there were no Title VI complaints related to LDEQ, LDH,
the State of Louisiana, or any of the State’s subcomponents pending at or otherwise under
consideration by EPA. Hoang Decl. ¶ 22.
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On June 16, 2023, the EPA objected to LDEQ’s issuance of a permit under the Clean
Air Act, on Title VI disparate-impact grounds. See exhibit 84. The EPA demanded that
LDEQ undertake analysis under “civil rights regulations” to avoid “unjustified
discriminatory effect., and that the State consider “whether the community is already
disproportionately impacted either by public health or environmental burdens.” Id.
The EPA has never taken or attempted to take any enforcement steps outlined in 40
C.F.R. § 7.130 (“Actions available to EPA to obtain compliance”) to terminate assistance,
refuse to award assistance, or refuse to continue assistance, against any state to obtain
compliance with EPA’s disparate-impact regulations. Hoang Decl. ¶ 23. The EPA has
successfully extracted settlements from Alabama, Michigan, and Missouri in the last
twelve months by threatening enforcement under Title VI. See exhibits 54-57.
The State incurs or would incur costs to comply with the challenged Title VI
disparate-impact regulations; Defendants remark that such compliance costs would be
funded by the grant itself. See 2 C.F.R. § 200.403(a).
On October 12, 2022, EPA issued a “Letter of Concern” to LDEQ and LDH, which
explained that it “issued[d] th[e] Letter [of Concern] to present significant evidence
suggesting that the Departments’ actions or inactions have resulted and continue to result
in disparate adverse impacts on Black residents of St. John the Baptist Parish, St. James
Parish, and the Industrial Corridor.” See exhibit 11, Doc. 12-11.
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The Letter of Concern requested that LDEQ and LDH “[c]onduct cumulative impact
analysis” and set forth detailed requirements that EPA demanded, at a “minimum,” what
“[t]hese cumulative impact analyses should” contain. Exhibit. 11 at 5-6. The Letter of
Concern did not allege that LDEQ or LDH had taken any actions on the basis of intentional
discrimination. See generally exhibit 11.
The EPA submitted document demands to LDEQ and LDH on April 26, 2023, as
part of its Title VI investigations. See exhibit 18, Doc. 12-18. In March 2023, the EPA
admitted that it could not continue informal negotiations with the State without securing
Sierra Club’s 5 consent to an extension. See Seidemann Decl. ¶¶ 65-70; see also exhibit 42.
Information was traded to secure Sierra Club’s consent; the EPA told attorneys for LDEQ
and LDH that it “did not think it was a very high price ... in order to get a 120-day extension
for the purpose of continuing what we think is a very productive discussions [and]
negotiation.” See Seidemann Decl. ¶¶ 65-70.
The EPA and LDEQ/LDH exchanged proposed settlement agreements with each
other, including redlines of EPA’s proposals. See exhibits 81-83, Docs. 34-2 and 34-4
respectively. In the course of the informal negotiations, Seidemann declared that to his
recollection, EPA never alleged that LDEQ and LDH had taken any actions that were the
product of intentional discrimination. See Seidemann Decl. ¶109.
5
Sierra Club is a private special interest group.
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LAW AND ANALYSIS
The State asserts the following causes of action: (1) those arising out of the
Constitution itself; (2) an equitable cause of action arising from the “power of federal
courts of equity to enjoin unlawful executive action; and (3) a non-statutory cause of action
to challenge when an executive action is ultra vires. The State remarks that these causes of
action do not require final agency action.
The State also asserts challenges under the private non-delegation doctrine and to
Defendants’ disparate-impact regulations under the Administrative Procedure Act’s
(“APA”) cause of action, 5 U.S.C. § 704. Under the private non-delegation doctrine, the
State posits that the EPA has taken final agency action by conveying governmental veto
power upon the Private Special Interest Groups, and then took further final agency action
by seeking (and obtaining) their approval to continue informal negotiations past December
2022, and again past March 2023. 6
As to disparate-impact regulations, the State maintains that Defendants have taken
final agency action in the form of making grants to the State and its agencies and purporting
to condition those grants on compliance with Defendants’ unlawful disparate-impact
mandates. 7
The State informs the Court that it is not seeking preliminary injunctive relief as to
its non-delegation doctrine (Counts I and II). 8 The State also will limit its request for
6
Seidemann Decl. ¶ ¶ 65-69 & exhibits 17, 37, and 42.
7
Seidemann Decl. ¶ ¶ 87-90 & exhibits 28-34.
8
Doc. 21.
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injunctive relief as to Extra-Regulatory Requirement (Count VI) to Defendant’s attempts
to impose cumulative-impact requirements and pre-decisional NEPA-like analysis, for
which the EPA has released publications detailing the mandates it intends to impose. 9
In response, Defendants oppose the Motion for Preliminary Injunction and also file
a Cross-Motion to Dismiss, or alternatively, Motion for Summary Judgment. Defendants
inform the Court that the above-mentioned complaints against the LDEQ and LDH allege
that these Louisiana agencies violated Title VI by discriminating against black
communities through their actions and inactions regarding chemical emitting facilities. 10
As admitted by the State, these complaints were either closed without a finding of a
violation under Title VI, or rejected.
The State remarks that its Motion for Preliminary Injunction challenges alleged
action by the EPA in connection with the now-dismissed Title VI complaints. 11 The State
has also filed a Request for Judicial Notice wherein it requests that the Court take judicial
notice of the EPA’s October 3, 2023, acceptance for investigation of a Title VI complaint
alleging only disparate impact by facially non-discriminatory policies. 12
The State challenges the EPA’s interpretation of its regulations as indicated in
Defendant’s Letter of Concern and additional permitting requirements that expand the plain
text of the Regulation. 13 The State asserts that the Letter of Concern sets standards by which
9
Id.
10
Doc. 29-1, p. 18.
11
Id.; Doc. 10.
12
Doc. 39, and exhibits A and B attached thereto.
13
40 C.F.R. § 7.35(b).
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LDEQ issues permits and further states the EPA’s position that it could cause the permits
to be modified, terminated or revoked if they violate the Clean Air Act. See 42 U.S.C. §
7661d. In other words, the EPA’s interpretation of 40 C.F.R. § 7.35(b), which is generic
and non-specific, goes beyond the plain text of the Regulation, to impose disparate impact
liability.
Defendants argue that its dismissal of the investigations concerning the complaints,
renders moot, Louisiana’s challenge of the EPA’s application of its regulations. Defendants
remark that the State’s arguments come fifty (50) years too late and conflicts with Supreme
Court precedent.
Defendants argue that the State’s lawsuit lacks Article III injury, which deprives
this Court of jurisdiction. Defendants also argue that the State’s challenge lacks merit
because the Supreme Court has approved substantively identical disparate-impact
regulations under Title VI.
As to the State’s challenge to the Department of Justice’s (“DOJ”) Title VI
implementing regulations, Defendants maintain that these regulations were not applicable
to EPA investigations, and the State does not allege that they apply to LDEQ or LDH.
Thus, Defendant argues that the State has failed to identify any nexus between the
challenged DOJ regulations and any harm Louisiana has suffered.
Defendants argue that the State’s challenge to the EPA’s negotiating positions, and
the complaint process itself is without merit because the State cannot show that receiving
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a settlement proposal inflicts any legally cognizable injury on the State, nor can the State
identify any final agency action to confer jurisdiction.
Before the Court can entertain the substantive issues in the State’s Motion for
Preliminary Injunction, or Defendants’ Cross-Motion for Summary Judgment, it must first
determine if this Court has subject matter jurisdiction.
I. SUBJECT MATTER JURISDICTION
A. Sovereign immunity
5 U.S.C. § 702 waives sovereign immunity for the claims at issue here. See Alabama-
Coushatta Tribe of Texas v. United States, 757 F.3d 484, 488 (5th Cir. 2014).
B. Article III standing
1. EPA’s disparate-impact (Counts III and V)
Defendants maintain that the State lacks standing to challenge EPA’s disparate
impact regulations (Counts III 14 and V 15) because the State has not suffered an injury
caused by EPA’s regulations that is redressable by this Court. Defendants argue that the
State does not identify any regulatory or administrative programs with which the EPA’s
disparate impact regulations interfere, and as such, the State does not identify any instance
where it is actually taking race-conscious action to comply with the EPA’s disparate impact
regulations. Defendants argue that the State has not shown any “genuine conflict” between
state and federal law that might be “capable of producing injury-in-fact” from EPA’s
14
Count III is the EPA’s Title VI disparate-impact regulations that allegedly exceeds the EPA’s authority under Title
VI.
15
Count V is Defendants’ disparate impact based Title VI mandates that allegedly violate the spending clause.
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disparate-impact regulations. Va. Ex rel. Cuccinelli v. Sebelius, 656 F.3d 253, 270 (4th Cir.
2011).
The State alleges that it has Article III standing due to the EPA’ acts of attempting
to impose illegal disparate-impact-based and extra-regulatory requirements upon the State,
and that such acts cause injury-in-fact by inflicting four (4) distinct types of sovereign,
quasi-sovereign, or proprietary harms. 16
Specifically, the State alleges harm by (1) subjecting it to an arbitrary deadline and
governmental processes in which the federal Executive illegally delegated governmental
powers to non-governmental entities, (2) imposing illegal disparate-impact-based and
extra-regulatory requirements upon the State, (3) constraining the State’s authority to
regulate and otherwise exercise its sovereignty within its borders, and (4) violating the
State’s right to clarity in the conditions concerning funding and the right not to be bound
by any restriction not unambiguously clear in the statutory text. 17
Additionally, the State argues that because it is “‘an object of the action (or forgone
action) at issue’ ... [the State’s] standing to seek review of administrative action is self-
evident.” Sierra Club v. EPA, 292 F.3d 895, 899-900 (D.C. Cir. 2002) (quoting Lujan v.
Defenders of Wildlife,504 U.S. 555, 561 (1992)).
The State asserts that if a regulation is unlawful, the imposition of any burden by it
constitutes “an invasion of a legally protected interest.” Lujan, 504 U.S. at 561. The State
16
Doc. 1, ¶ 198-203.
17
The State alleges that Title VI makes it a violation to discriminate on the basis of race, color, or national origin,
yet Defendants’ disparate-impact regulations go beyond Title VI’s statutory text.
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argues that regulations invariably create compliance, familiarization, and planning costs—
all of which are cognizable and redressable injuries that flow from illegal regulations. For
that reason, “[a]n increased regulatory burden typically satisfies the injury in fact
requirement.” Contender Farms, L.L.P. v. USDA, 779 F.3d 258, 266 (5th Cir. 2015)
(holding that plaintiff had object-of-regulation standing).
Defendants admit that the State is the object of the challenged regulation, but argue
that the State has not established (1) an injury in fact (2) fairly traceable to the challenged
conduct of the Defendants, and (3) redressable by a favorable judicial decision to possess
Article III standing on any of its claims. Defendants argue that these “three elements” are
the “‘irreducible constitutional minimum’ of standing” that “the party invoking federal
jurisdiction” always “bears the burden of establishing.” Spokeo, Inc. v. Robins, 578 U.S.
330, 338 (2016). Defendants argue that the State has failed to allege any ambiguity
concerning the conditions imposed by the EPA that accompany federal funding.
As noted in Contender Farms, the court found that the plaintiffs were the object of
the challenged conduct, and further concluded that plaintiffs established standing because
the challenged regulations amounted to an increased regulatory burden. 779 F.3d at 266
(citing Ass’n of Am. R.R.s v. Dep’t of Transp., 38 F.3d 582 (D.C. Cir. 1994) (an increased
regulatory burden typically satisfies the injury in fact requirement).
The State argues that the increased cost to comply with the illegal regulations is a
cognizable injury. The State argues that it has a constitutional right to not to be bound by
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any condition beyond what Title VI’s statutory text unambiguously establishes, and that
Defendants’ disparate-impact regulations violate that right by doing just that.
The State also contends that it has standing under the Supreme Court’s Spending
Clause jurisprudence, noting that it has a right to clarity in Spending Clause conditions.
The State asserts that the Government violates the Constitution either when (1) Congress
presents the States with unclear conditions or (2) the Executive or Judiciary tries to enforce
a Spending Clause condition against the States that goes beyond what the statutory text of
the condition unambiguously establishes. The State considers these as sovereign rights it
possesses under our “system of dual sovereignty between the States and the Federal
Government.” Gregory v. Ashcroft, 501 U.S. 452, 457 (1991).
The State argues that the Executive is wholly without constitutional power to impose
Spending Clause conditions that exceed what Congress has unambiguously provided in the
statutory text and the States have a corresponding right not to be so bound. Arlington
Central Sch. Dist. Bd. Of Educ. v. Murphy, 548 U.S. 291, 301 (2006).
Under the Spending Clause, “[i]f congress intends to impose a condition on the grant
of federal moneys, it must do so unambiguously” to ensure that “the State voluntarily and
knowingly accepts the terms of the ‘contract.’” Pennhurst States Sch. & Hosp. v.
Halderman, 451 U.S. 1, 17 (1981). There can “be no knowing acceptance if a State is
unaware of the conditions or is unable to ascertain what is expected of it.” Id. at 17.
Next, the State argues that it has a right to be free of the exercise of federal
governmental power dictated by private parties and that the EPA violated that right by
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being subjected to unconstitutional agency authority. Axon Enter., Inc. v. FTC, 143 S.Ct.
890, 903 (2023). The State alleges that it was subjected to an illegitimate proceeding due
to investigations infected by a non-delegation doctrine violation and led by Private Special
Interest Groups. Specifically, the State complains that the EPA issued a “civil investigative
demand” and required the State to provide documents it would prefer to withhold. The
State argues that it will lose all of its federal funding if it does not comply with the EPA’s
demands that were propagated by these Private Special Interest Groups.
Additionally, the State complains that it was forced to produce documents upon
demand, review and redline proposed settlement agreements, respond to the Letter of
Concern, join innumerable conference calls, and indulge the EPA’s pronounced habit of
canceling meetings at the last minute, after this suit was filed. The State argues that this
has caused it to incur costs that are not recoverable, which establishes irreparable injury.
The State also asserts it has standing based on the threat of enforcement. The State
notes that the EPA (1) had accepted complaints against LDEQ and LDH, (2) issued a letter
of Concern with detailed allegations of Title VI disparate-impact violations and demanded
that the State “[c]onduct cumulative impacts analyses,” (3) was drafting findings of
violations, and (4) was set to move to formal enforcement proceedings a mere 48 days after
the Complaint was filed, on July 11. 18
The EPA argues that a credible threat of enforcement did not exist at the time that this
lawsuit was filed.
18
Plaintiff’s exhibit 11, pp.3-5 and exhibits 22-23.
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The State argues otherwise and contends that it still faces a credible threat even after
the investigations were terminated. The State notes that the EPA’s June 16 Objection
makes plain that its intentions to enforce its mandates against the State is an ongoing and
absolute certainty; 19 moreover, the objection makes clear that the EPA is enforcing the
challenged disparate-impact and cumulative impact regulations against the State with no
intention to abandon them.
The Cover Letter to the EPA’s objections gives a narrative of its analysis that assessed
key demographic and environmental indicators. The EPA noted that an Environmental
Justice (“EJ”) analysis should be developed to assist states and stakeholders, and the EJ
analysis should include input from the community, an evaluation of existing environmental
data, use of known demographic information and other relevant information. The EPA
also encouraged the LDEQ to screen permitting actions for EJ concerns and to consider
potential compliance issues related to civil rights of the communities potentially impacted
early in the permitting process. Such screening would indicate whether a permitting
decision had the potential to contribute to significant public health or environmental
impacts, if the community may be particularly vulnerable to impacts from the proposed
permit, and whether the community is already disproportionately impacted either by public
health or environmental burdens. Additionally, the screening practice would provide
information as to whether there are residents of the affected community who could be
disproportionately subject to adverse health, environmental and/or quality of life impacts
19
Plaintiff’s exhibit 84.
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on the basis of income, national origin, or other demographic factors. The letter also stated
that “[i]ntegrating environmental justice in decision making and ensuring compliance with
civil rights laws can, together, address the strong correlation between the distribution of
environmental burdens and benefits and the racial and ethnic composition, as well as
income level of communities. 20
The State contends that such disparate impact analysis required by the EPA cannot be
without costs. It would require gathering data, coding, designing proper regression analysis
and analyzing the results.
The State also complains that Defendants have not disavowed their position that
States must comply with their challenged mandates when issuing permits or taking other
relevant actions. The State considers this strong evidence that it faces a credible threat of
enforcement, citing California Trucking Ass’n v. Bonta, 996 F.3d 644, 653 (9th Cir. 2021),
cert. denied 142 S.Ct. 2903 (2022); see also Seals v. McBee, 898 F.3d 587, 592 & n. 9 (5th
Cir. 2018). Consequently, the State argues that without a clear disavowal from the EPA
that it will not enforce any disparate impact or cumulative impact mandates against the
State, the risk of enforcement against the State is manifest.
Defendants remark that the June 16 Objection to the State’s proposed permit renewal
was based solely on technical grounds, to wit: (1) the LDEQ failed to justify the
methodology it used to estimate the permittee’s emissions, (2) failed to account for
20
Id. p. 2.
Page 20 of 77
uncontrolled emissions, and (3) failed to limit sulfur content according to permit limits.21
Defendants assert that these objections were not based on disparate-impact grounds.
Defendants also remark that the cover letter 22 referenced environmental justice but did not
purport to apply its disparate impact regulations against the State. Additionally, the EPA
informs the Court that the LDEQ issued the permit in September 2023. 23
Defendants argue that California Trucking Ass’n v. Bonta is distinguishable from the
instant matter. The California Trucking case involved a state that had already “commenced
a number of prosecutions” under the challenged statute, whereas in this case the EPA has
not brought any Title VI disparate-impact enforcement proceedings. Additionally,
Defendants remark that considering that the EPA’s disparate-impact regulations have
existed for over fifty years, the lack of enforcement outweighs any speculative possibility
of future enforcement. Thus, Defendants posit that not only has the State failed to establish
a credible threat of enforcement, it cannot show that its purported costs are a cognizable
injury.
The State argues it faces imminent threats based on the EPA’s threat to issue
findings of a violation within 48 days if the State did not agree to a settlement agreement, 24
underscored by the EPA objecting to a permit within one month thereafter on disparate-
impact and cumulative-impact grounds. Thus, the State maintains that the objection carries
the force of law, see 42 U.S.C. § 7661d, and ultimately this is proof of imminent future
21
Doc. 34-5, pp. 5-11.
22
Doc. 34-5, p. 3.
23
Defendant’s exhibit E.
24
Page 21 of 77
injury. Additionally, the State argues that it currently faces new and ongoing injury every
time it issues a permit and is required to comply with Defendants’ fluid, and ever-
increasing disparate impact mandates.
The State argues that the EPA’s actions were either overwhelmingly or exclusively
driven by disparate-impact theories through its Letter of Concern, document demands, and
the mandates it sought to impose during the informal negotiations. 25 Also, the State notes
that what was noticeably absent during the informal negotiations, was any credible or
serious allegation that the State’s actions were motivated by intentional discrimination. 26
Thus, the State asserts that Defendants cannot argue that intentional discrimination was a
significant component of its investigation.
As to the costs incurred by the State to comply with Defendants’ disparate-impact
regulations whenever it renews a permit, 27 Defendants argue that any such costs may be
funded by the grant itself, see 2 C.F.R. § 200.403(a), thus there are no costs. Defendants
note that the Burdette Declaration does not state that Louisiana conducts a disparate impact
analysis prior to renewing permits, but instead it states that “costs to LDEQ would increase
if LDEQ is required to perform additional disparate impact analyses on permit renewals.” 28
The State informs the Court of the increased funding the EPA has sought to employ
full time employees for 2023 ($11.6 million) and again for 2024 ($42.3 million), the
purpose of which is for the EPA to analyze and enforce Title VI disparate and cumulative
25
Plaintiff’s exhibit 11, pp. 3-5.
26
Siedermann Declaration, ¶ 109.
27
Burdette Declaration par ¶ 17-22.
28
Id. ¶ 22.
Page 22 of 77
impacts. 29 Finally, the State contends that there is a credible threat of enforcement, which
is clearly supported factually by the settlements with the States of Alabama, Michigan and
Missouri in the last twelve months.
The Court disagrees with the EPA and finds that when the suit was filed, there was
a credible threat of enforcement as indicated by the EPA accepting complaints against the
LDEQ and LDH, demanding that the State conduct disparate and cumulative impact
analyses, and moving to formal enforcement proceedings within 48 days after the
Complaint was filed. 30 Furthermore, the EPA has not disavowed its demands of disparate
and cumulative impact analyses, but instead argues that Title VI should be interpreted
broadly to allow such. Finally, the EPA’s increased funding to enforce and analyze Title
VI disparate impacts and cumulative impacts certainly supports the State’s arguments
concerning a credible threat of enforcement.
The Court agrees with the State that it has standing against the EPA to assert the
claims presented here. As noted by the State, if it has to consider disparate impacts, there
would be an increased burden. Further, the EPA’s argument that any increased funds would
be paid by the grant itself is of no moment, inasmuch as this would decrease the amount of
the disposable fund proceeds, should the grant be awarded, and yet be an increased cost to
the State, should the grant not be awarded.
29
Plaintiff’s exhibits 52 and 53.
30
Exhibit 11, p. 3-5; exhibit 22-23; Seidemann Declaration, ¶ ¶ 18, 73.
Page 23 of 77
In summation, the State has established that there is a credible continued threat of
enforcement and an increased burden due to the EPA’s decision to require disparate impact
analysis when issuing permits and/or conditioning a grant with a disparate impact analysis.
To be sure, by accepting federal funds, the State is bound by the terms of Title VI and its
implementing regulations (if valid) for the duration of the grants and is coerced by the
possibility of losing federal funds into complying with them. The State, therefore, is subject
to imminent harm that is traceable to the EPA’s regulations. As such the State has standing
against the EPA to assert its claims because it has established a “case or controversy” that
permits it to challenge the validity of the disparate impact and cumulative impact mandates.
See MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118, 129 (2007).
2. DOJ’s disparate-impact (Counts IV and V)
The State argues that it has standing against the DOJ for the same essential reasons
that apply to the EPA: (1) the State’s Department of Justice is the object of those DOJ
regulations, (2) the DOJ’s attempt to impose disparate-impact liability exceeds the
unambiguous text of Title VI thereby causing sovereign injury, and (3) the Louisiana
Department of Justice is bound to Title VI by funding grants from DOJ and itself takes
actions that are subject to DOJ’s disparate-impact mandates, which result in compliance
costs. 31
Defendants argue that the State lacks standing to challenge the DOJ’s disparate impact
regulations because it cannot establish a “sovereign injury” to its “power to create and
31
See Sinquefield Decl. ¶¶ 3-9, Doc. 34-32.
Page 24 of 77
enforce a legal code” 32 flowing from DOJ’s disparate impact regulations. Defendants argue
that the State does not identify any of its own regulatory or administrative programs that
conflict with the challenged regulations, and it cannot assert sovereign injury flowing from
the alleged ambiguity regarding conditions imposed on the DOJ grants in light of Plaintiff’s
admission that no such ambiguity exists. 33
Next, Defendants argue that the State neither alleges the existence of any
enforcement proceedings brought under DOJ’s disparate-impact regulations nor even
asserts that pre-enforcement review is warranted because such future enforcement
proceedings are likely. 34 Thus, Defendants maintain that the State cannot establish standing
for a pre-enforcement challenge. Defendants also argue that the State’s assertion of
increased costs are speculative and unsubstantiated.
To support its claims, the State provides the Declaration of Ryan Seidemann,
Assistant Attorney General, employed by the Louisiana Department of Justice. On
November 2, 2022, EPA provided the LADOJ with a copy of the Letter of Concern sent to
LDEQ and LDH and a Case Resolution Manual. 35 Afterward, informal resolution
discussions began on November 16, 2022. The LADOJ inquired as to exactly what EPA
believed the LDEQ and LDH were doing wrong and noted that the EPA’s Letter of Concern
failed to identify specific actions. 36 The LDOJ specifically requested that the EPA identify
32
Doc. 15, p. 41.
33
See Compl. ¶ 23.
34
See Compl. ¶¶ 228-40.
35
Declaration of Ryan Seidemann, ¶ 19, and attached Exhibits 11 and 12.
36
Id. ¶ 22.
Page 25 of 77
any provisions in Louisiana law, any actions, or inactions that the EPA believed were in
conflict with Title VI, and further asked that the EPA provide supporting legal analysis. 37
Refusing to do so, instead, the EPA reiterated the elements of a disparate impact
claim, then stated “this is not an environmental engagement per se.” 38 EPA officials further
stated that “compliance with environmental laws is not a shield to Title VI.” 39 As the
informal resolution discussions progressed, EPA officials refused to identify specific
actions or inactions that purportedly triggered its Title VI concerns. 40 This is buttressed by
one EPA official’s statements that the EPA was “not looking at actual permit issuance and
what happened each time a permit was issued.” 41 However, Defendant Lilian Dorka
elaborated that no specific action is at issue but that the EPA is targeting the cumulative
impact of LDEQ’s actions. Then, three weeks later, LADOJ complained that the EPA had
not identified anything specific that the EPA considered a civil rights problem, other than
outcome. Dorka responded that “this is not about procedures,” rather “it’s your method of
administering your air program in a couple of different instances ... we find strong evidence
that the method of administering the air program ... resulted in some harms, some impacts,
and that those impacts were born disproportionately based on race.” 42
37
Id. ¶ 23.
38
Id. ¶ 24.
39
Id. ¶ 25.
40
Id. ¶ 26.
41
Id.
42
Id. ¶ 27.
Page 26 of 77
LADOJ again asked for specifics and Dorka pointed to LDEQ’s “administration of
the air program.” 43 Ultimately, Dorka pointed to LDEQ’s issuance of a single permit and
said “that subjected people to discrimination,” refusing to state whether its Letter of
Concern represented a complete statement of EPA’s concerns. 44
The LADOJ explained to the EPA that it was required to comply with the statute
but was entitled to be notified specifically as to how it was in noncompliance and again
asked that the EPA identify specifics as to noncompliance with Title VI. EPA’s only
response included disparate impact, and whether alleged harms fall on communities that
are predominately black. 45 Dorka admitted that “you’re not going to see in any letter where
we think [LDEQ or LDH] violated the law,” but “what we’re saying here, is in the future,
put a process in place, as we’ve been engaging with many, many states ... other states ... so
that you yourself can do an analysis ... both from an [environmental justice] perspective
[and] from a civil rights perspective, that gives you an idea of whether the actions you may
be about to take could have a disparate impact on the basis of race.” 46
LADOJ sought to confirm the EPA’s positions via letters memorializing the
informal resolution discussions; the EPA responded that it would “not be responding at this
time to [one letter’s] specific points ....” 47
43
Id. ¶ 28.
44
Id.
45
Id. ¶ ¶ 31-32.
46
Id. ¶ 33.
47
Id. ¶ 35 and attached exhibits 13 and 15; ¶ 36 and attached exhibit 14.
Page 27 of 77
On January 18, 2023, Dorka stated that the initial draft informal resolution
agreements that it presented contained standard boilerplate commitments but that she
expected the agencies “to get back to [EPA] as to whether you already have certain things
in place.” 48 Dorka made clear that the EPA expected NEPA-like pre-decisional analysis of
the potential for disparate impact, including express consideration of race. 49
In a subsequent conversation, LADOJ requested the statutory or regulatory basis for
requiring a NEPA-like pre-decisional process to which Dorka responded that “what we’re
putting in place is totally based on a Title VI approach,” and “in formally resolving a
number of these types of cases, we are helping folks put into place a framework, a Title VI
disparate impact, identify and address-type of framework,” “to address this
prospectively.” 50 Unable to point to a specific provision, Dorka pointed to 40 C.F. R. §
7.35 and acknowledged that “[n]othing’s gonna say that it requires [an analysis] to be
conducted before” a permitting action. 51 Dorka made clear that the EPA expected LDEQ
to add permitting conditions not authorized by environmental statutes 52 expressly stating
that “odor, traffic, safety, things like that that are nevertheless from a civil rights
perspective adversities that could be caused by certain actions,” 53 and “[s]ometimes ... in
48
Id. ¶ 37.
49
Id. ¶ 39.
50
Id. ¶ 40.
51
Id. ¶ 41.
52
Id. ¶ 42.
53
Id.
Page 28 of 77
order to address what appears to be a disparate impact, disparate harm, you may need to go
beyond [environmental statutory] authorities.” 54
In summation, based on the conversations detailed above, the State asserts that the
EPA is demanding ex-ante NEPA-like analysis to unlawfully facilitate decision-making on
the express basis of race, and demand that the LDEQ conduct cumulative impact
assessments as part of its permitting process, notwithstanding the absence of statutory
authority for requiring such assessments. Seidemann declares that the EPA has confirmed
that its demand was for LDEQ to “commit to doing a disparate impact screening
assessment for every renewal permit application for any major source or synthetic minor
source across the state. 55
Again, this Court disagrees with Defendants. There is a credible threat of
enforcement; the State has received grants from the DOJ and will continue to apply for
grants in the future, 56 which the State asserts will cause it to be subjected to unconstitutional
proceedings for all future Title VI complaints. To comply with the disparate impact
analysis, the LADOJ would be required to expend additional LADOJ resources, including
hiring additional staff, purchasing additional equipment, and additional work hours for
personnel, in addition to collecting and reviewing information regarding the race, color,
and national origin of communities impacted by LADOJ activities. 57
54
Id.
55
Id. ¶ 51.
56
Sinquefield Decl. ¶ 3, 5 Doc. 34-32.
57
Id. ¶ 7.
Page 29 of 77
The Court agrees with the State that the disparate impact and cumulative impact
analysis the EPA is requiring as a condition for funding grants, creates a race-based
decision. Where an action would have a disparate impact, a decision-maker is often
compelled to act intentionally on the basis of racial considerations to avoid the disparate
impact, see e.g., Raytheon, 540 U.S. 44, 52 (2003), thus disparate impact regulations
require decision makers “to evaluate the racial outcomes of their policies, and to make
decisions based on (because of) those racial outcomes.” Ricci v. DeStefano, 557 U.S. 595-
96 (2009). (Scalia, J., concurring).
The Court finds that for the reasons stated concerning the EPA, because the State
will be potentially subject to unconstitutional proceedings for all future Title VI
complaints, permitting processes, or grant funding, and the increased burden to the State,
it has standing against the DOJ to asserts its claims.
3. EPA’s standing challenge as to “extra-regulatory requirements” (Count VI)
The State alleges that during the informal resolution process, the EPA’s proposed
settlement agreement contained “extra-regulatory” requirements that extended beyond
Title VI’s regulations. Defendants argue that even if the “EPA’s proposals” were unlawful,
the State does not allege that the EPA forced the LDEQ or LDH to accept them, nor can
they because the Complaints were closed without any formal resolution. Defendants argue
that the State’s complaint as to these extra-regulatory requirements are no more than a
“generalized interest in proper application” of EPA’s regulations, and not itself an injury
Page 30 of 77
in fact. Delta Com. Fisheries Ass’n v. Gulf of Mexico Fishery Mgmt. Council, 364 F.3d
269, 273 (5th Cir. 2004).
Additionally, Defendants argue that to the extent receiving proposals during
unsuccessful informal resolution discussions constitutes an injury in fact, that past injury
does not confer standing on the State’s claims for prospective relief. O’Shea v. Littleton,
414 U.S. 488, 495-96 (1974); see also City of Los Angeles v. Lyons, 461 U.S. 95, 101-08
(1983). Thus, Defendants argue that the State has not suffered an injury in fact.
The State maintains that there will be compliance costs because such mandates
“require the [regulated entities] to begin collecting and reviewing information regarding
applicants’ race, color, [etc.] to monitor their compliance with the Rule,” which “causes
[the regulated parties] to incur costs.” See, e.g. Prop. Cas. Insurers Ass’n of Am. v.
Donovan, 66 F.Supp.3d 1018, 1043-44 (N.D. Ill. 2014).
The State points to an LDEQ permit under the federal Clean Air Act, to which the
EPA objected on June 16, 2023. 58 The stated objections encompass the EPA’s concern
with Environmental Justice and requires the LDEQ to perform analysis and consider
overburdened communities. Specifically, the EPA is requiring the LDEQ to perform a
screening practice to provide information as to whether there are residents of the affected
community who could be disproportionately subjected to adverse health, environmental
and/or quality of life impacts on the bases of income, national origin or other demographic
58
Page 31 of 77
factors. 59 The objection also states that it has conducted its own analysis to assess key
demographic and environmental indicators which shows a total population of
approximately 1,921 residents of which 86% are people of color, 47% are low income, and
23% have less than a high school education.
The Objection also notes that civil rights regulations prohibit state, local, or other
entities that receive federal financial assistance, from taking actions that are intentionally
discriminatory as well as practices that have an unjustified discriminatory effect, including
on the bases of race, color, or national origin. The Objection requires the State to consider
“whether the community is already disproportionately impacted either by public health or
environmental burdens.” 60The LDEQ has not removed said Objections.
The State asserts that the EPA is demanding that the State conduct analysis under
civil rights regulations to avoid unjustified discriminatory effect (Title VI disparate impact
mandates) and cumulative impacts analysis by insisting that the State consider “where the
community is already disproportionately impacted either by public health or environmental
burdens.” 61 The State presents evidence that such analysis would cost millions of dollars
to comply with the EPA’s demand in the permitting process. 62
Additionally, the State informs the Court that the EPA sought from Congress an
additional $11.6 million and 50 new full-time employees for fiscal year 2023 to “address
actions, policies, and practices by recipients of EPA funding that have a discriminatory
59
Id. p. 2.
60
Id.
61
Id. p.2.
62
Seidemann Declaration ¶ 71.
Page 32 of 77
impact on overburdened and disadvantaged communities,” 63 to analyze and enforce Title
VI disparate impacts, including cumulative disparate impacts. It similarly seeks “an
additional $42.3 million and 9.5 FTE [full-time employees]” for fiscal year 2024 to “to
modernize [EPA’s] national enforcement and compliance data system and to expand
compliance monitoring efforts to address environmental justice issues.” 64
The Court agrees with the State and finds that it has established an injury and thus has
standing to challenge the extra-regulatory requirements the EPA is imposing upon the
State.
EPA’s standing to challenge “parallel track” proceedings (Count VII)
The State complains that during the EPA’s and LDEQ’s informal negotiations, the
EPA was proceeding on “parallel tracks,” which is contrary to its own regulations. See 40
7.120(d). Specifically, the State complains that during the informal negotiations, the EPA
was also on a fact-finding journey to ensure that it was in a position to resolve the complaint
through the issuance of Preliminary Findings, should the EPA and LDEQ not be able to
reach an agreement.
Defendants argue that the State’s challenge to the EPA’s conduct of “parallel
tracking” is not an injury in fact because it is more of a procedural injury as opposed to a
substantive injury. The EPA maintains that the State has failed to establish a concrete
63
Exhibit 52, pp. 393-94 (emphasis added).
64
Exhibit, 53, p. 241.
Page 33 of 77
injury, and even if it could, the challenged enforcement proceedings are closed thus,
foreclosing a finding of Article III standing.
While the Court finds that the State’s challenge of parallel tracking is insufficient
for standing, it does support the State’s position that the EPA’s actions were attributable to
litigation posturing as explained below.
C. Mootness due to closure of Title VI complaints
The EPA maintains that the closure of the Title VI complaints against the LDEQ
and LDH renders moot any claims for which the State may have once had standing.
“Mootness is ‘the doctrine of standing in a time frame. The requisite personal
interest that must exist at the commencement of litigation (standing) must continue
throughout its existence (mootness).’” Ctr. for Individual Freedom v. Carmouche, 449 F.3d
655, 661 (5th Cir. 2006) (quoting U.S. Parole Comm’n v. Geraghty, 445 U.S. 388, 397
(1980)). “As a general rule, any set of circumstances that eliminates actual controversy
after the commencement of a lawsuit renders that action moot.” Env’t Conservation Org.
v. City of Dallas, 529 F.3d 519, 527 (5th Cir. 2008) (quotation omitted). To remain a
justiciable controversy, then, the plaintiff must “maintain a ‘concrete interest in the
outcome’” and “effective relief” must remain “available to remedy the effect of the
violation.” Dailey v. Vought Aircraft Co., 141 F.3d 224, 227 (5th Cir. 1998). Accordingly,
“[a] moot case exists when the court cannot grant relief that would affect the parties and
redress the plaintiff’s alleged wrongs.” First Indiana Fed. Sav. Bank v. FDIC, 964 F.2d
503, 507 (5th Cir. 1992). And, as with standing, “the court must evaluate mootness on a
Page 34 of 77
claim-by-claim basis to determine whether each claim satisfies the constitutional
requirements for Article III jurisdiction.” United States v. Vega, 960 F.3d 669, 673 (5th Cir.
2020).
“The burden of demonstrating mootness ‘is a heavy one.’” Los Angeles Cnty. v.
Davis, 440 U.S. 625, 631 (1979). “A case becomes moot only when it is impossible for a
court to grant any effectual relief whatever to the prevailing party.” Knox v. SEIU, 567 U.S.
298, 307 (2012) (cleaned up) (emphasis added). “As long as the parties have a concrete
interest, however small, in the outcome of the litigation, the case is not moot.” Id. at 307-
08 (cleaned up).
The State maintains that its claims are not moot under ordinary mootness standards,
and if it were, this case falls within the exception because the EPA’s actions are transparent
“‘litigation posturing’ to avoid judicial review.” Yarls v. Bunton, 905 F.3d 905, 910 (5th
Cir. 2018). Additionally, the State contends that its non-delegation claim satisfies the
“capable of repetition, yet evading review” exception to mootness.
The State asserts that it continues to face injuries from Defendants’ disparate impact
and cumulative impact mandates as they occur every time that the State considers whether
to grant a permit, make a funding request, or any other action governed by Title VI. In
other words, they continue to bind the State in all relevant decisions, and the State will
continue to incur compliance costs as long as the mandates are still in existence. The State
argues that granting its requested relief will instantly and completely lessen the State’s
regulatory burdens in all relevant permitting decisions, and also remedy the State’s
Page 35 of 77
sovereign/Spending Clause injury. The State again refers to the EPA’s June 16 Objection
that has not been withdrawn. Thus, again the State insists that there is a credible threat of
enforcement.
As to the State’s non-delegation claim, the EPA argues that because the Complaints
have been closed Plaintiff lacks standing to assert this claim. In other words, the complaints
out of which those negotiations arose are now closed, thus the Court cannot issue relief to
redress Plaintiff’s already-suffered non-delegation injuries.
The State maintains that its non-delegation claims are not moot because there is a
reasonable prospect of recurrence. The State provides instances of two other Title VI
complaints that have been filed by the Sierra Club in other jurisdictions. 65 The State
remarks that the EPA has provided no assurances or commitments that it will not avoid
future non-delegation violations.
“It is well settled that a defendant’s voluntary cessation of a challenged practice
does not deprive a federal court of its power to determine the legality of the practice. If it
did, the courts would be compelled to leave the defendant ... free to return to his old ways.”
Friends of the Earth, Inc. v. Laidlaw Env’t Servs. (TOC), Inc., 528 U.S. 167, 189 (2000)
(cleaned up) (citations omitted). Even where the voluntary cessation is by governments,
“voluntary cessation … moots a case … only if it is ‘absolutely clear that the allegedly
wrongful behavior could not reasonably be expected to recur.’” Adarand Constructors, Inc.
v. Slater, 528 U.S. 216, 222 (2000) (quoting United States v. Concentrated Phosphate
65
Doc. 34. P. 21, fn.11.
Page 36 of 77
Export Assn., Inc., 393 U.S. 199, 203 (1968)) (rejecting government defendant’s mootness
argument).
For voluntary cessation to establish mootness, federal courts “‘must be certain that
a defendant’s voluntary acts are not mere ‘litigation posturing’—and that ‘the controversy
is actually extinguished.’” Tucker v. Gaddis, 40 F.4th 289, 295 (5th Cir. 2022) (Ho., J.,
concurring) (quoting Yarls, 905 F.3d at 910). Here, the State argues that the EPA’s actions
flunk both requirements: (1) its actions are obvious “litigation posturing” and (2) even after
EPA’s voluntary abdications, the dispute here is far from “actually extinguished.” Id. In
addition, the State remarks that all of the Fenves factors 66 identified by the Fifth Circuit for
overcoming the presumption of good faith are present here.
The State complains that the EPA’s closure and later rejection of the Complaints
after this suit was filed on June 21, 2023, requesting a decision on the preliminary
injunction by July 11, 2023, was nothing more than political posturing to avoid answering
on an expedited bases and receiving a bad ruling from this Court. See e.g. Speech First,
Inc. v. Fenves, 979 F.3d 319, 328 (5th Cir. 2020) (holding that “the suspicious timing of
the change” weighed against mootness.).
The State also questions the EPA’s closing of the Complaints without one scintilla
of relief, despite the parties trading multiple drafts of resolution agreements that provided
66
The Fenves factors that can overcome the presumption of [good faith] include: (1) the absence of a controlling
statement of future intention not to repeat the challenged policy; (2) the suspicious timing of the change, and (3) the
governmental entity’s continued defense of the challenged policy after the supposedly mooting event. Speech First,
Inc. v. Fenves, 979 F.3d 319, 328 (5 th Cir. 2020) (holding that “the suspicious timing of the change” weighed
against mootness.).
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the EPA with substantial benefits and new procedures, and when the parties were so close
to an ultimate agreement. 67 Thus, the State opines that the real reason behind closing the
Complaints was to avoid an expedited answer in this Court, but more significantly the
prospect of an unfavorable ruling by this Court.
The State has presented undisputed evidence that the agreement the EPA abruptly
walked away from would have been a win for the private interest groups that had filed the
Complaints. This is supported by the following statements and/or comments by interested
persons:
• Achieved “meaningful reform.” (Deep South Center for Environmental Justice

Director of Law and Policy Monique Harden). Exh. 62 at 4.
• Attained a “tremendous step forward.” (Harden.) Id
• “[G]iven LDEQ all of the tools that it could need to do a better job than what it has
done.” (Lisa Jordan, Head of Tulane Environmental Law Clinic. Id.).
• The agreements would have “ingrained sweeping new procedures to ensure that
future permitting decisions included an in-depth analysis into ... the adverse
[disparate] impacts” and represented a major win for EPA. 68
The EPA’s stated reasons for closing the investigation was its inability to resolve it
by July 11, 2023, despite the investigation going on for over a year. As noted by the State,
67
The State has provided, through FOIA requests, some of the Complainants statements that the EPA and the State
were close to an agreement (Plaintiff’s exhibit 65), and draft agreements that explained that the agreement would
have “ingrained sweeping new procedures to ensure that future permitting decisions included an in-depth analysis
into . . . the adverse [disparate] impacts” and represented a “major win” for the EPA. Plaintiff’s exhibit 68, p. 3.
Additionally, the Environmental groups believed that the agreements provided substantial gains. Plaintiff’s exhibit
62, p. 4.
68
Exhibit 68, p. 3. WWNO – New Orleans public Radio, Halle Parker, August 29, 2023.
Page 38 of 77
after it filed the instant suit, the EPA began cancelling all telephone conferences without
any explanation.
The Court finds that the voluntary-cessation exception to mootness applies here
because it is abundantly clear that the EPA was litigation posturing considering the timing
and abrupt closing of the Complaints, its absence of a statement to not attempt to enforce
its disparate-impact and cumulative-impact mandates against the State, and the EPA’s
defense of the challenged policy after the supposed mooting event.
The Court further finds that the Fenves factors are clearly met. The EPA refuses to
make a controlling statement of future intention not to repeat the challenged policy. To the
contrary, the evidence makes clear that the EPA intends to promote and enforce its
disparate impact and cumulative impact conditions with regard to grants and permits. As
delineated above, the EPA’s timing of the Complaints is beyond suspicion, and finally, the
EPA continues to vehemently defend its position regarding the challenged mandates.
Furthermore, it is absolutely clear to this Court that the alleged wrongful behavior
could reasonably be expected to recur in the not-to-distant future and/or is already
occurring in this State as well as across this nation. Adarand Constructors, 528 U.S. at 222.
The Court agrees with the State that there is a very real and tangible possibility that the
EPA will attempt to enforce its cumulative impact mandates against the State as evidenced
by the June 16, Objection. As such, the Court finds that should it agree with the State’s
challenges, relief could be granted that would affect the parties and redress the alleged
Page 39 of 77
wrongs as to the State’s challenges to the EPA’s disparate impact mandates and extra-
regulatory requirements.
As to the State’s non-delegation and parallel-track claims, the Court agrees with
Defendants that because the claims are closed, no relief could potentially be granted. Thus,
these claims are moot.
D. Alternative path for judicial review
In determining whether a plaintiff’s claim is “‘of the type Congress intended to be
reviewed within this statutory structure,”’ courts consider three factors: (1) “could
precluding district court jurisdiction ‘foreclose all meaningful judicial review’ of the
claim?”, (2) “is the claim ‘wholly collateral to [the] statute’s review provisions’?”, and (3)
“is the claim ‘outside the agency’s expertise’?” Axon, 143 S. Ct. at 900 (quoting Thunder
Basin, 510 U.S. at 212-13).
Defendants maintain that each Thunder Basin factors weighs in favor of review within
the statutory scheme. Defendants argue that the State has failed to show that any of these
conditions are satisfied, and the State would have the opportunity for meaningful judicial
review should it actually suffer any injury, both before the agency and on judicial review
of the agency’s determination in district court. 40 C.F.R. § 7.130(b)(2) (providing for
proceedings before ALJ to obtain compliance with EPA Title VI regulations); 42 U.S. C.
§ 2000d-2 (providing for judicial review of any decision to terminate or refuse to grant
funding upon a finding of a failure to comply with Title VI requirement).
Page 40 of 77
Defendants argue that the Court lacks jurisdiction to review Counts II-VII because
Congress has provided an adequate, alternative path for judicial review. The EPA argues
that judicial review here is barred because Congress has allowed judicial review for
“agency action taken pursuant to [42 U.S.C.] section 2000d-1” for “terminating or refusing
to grant or to continue financial assistance upon a finding of failure to comply with any
[section 2000d-1] requirement.” Thunder Basin Coal Co. v. Reich, 510 U.S. 200, 207, 216
(1994).
Defendants argue that Congress intended legal challenges to the EPA and DOJ
interpretations of Title VI (and regulations promulgated pursuant to Title VI) to be brought
within the procedural scheme for administrative enforcement proceedings that culminates
in the opportunity for judicial review.
Next, Defendants argue that the State’s claims are not wholly collateral to the
administrative review scheme. Bank of La v. FDIC, 919 F.3d 916, 928 (5th Cir. 2019), but
are inextricably intertwined with the issue of potential future enforcement proceedings as
to whether certain conduct constitutes unlawful discrimination. Defendants further argue
that the State’s claims of alleged irregularities in the agency enforcement proceedings
could be raised as defenses, therefore they are not wholly collateral to the administrative
enforcement scheme. Additionally, Defendants argue that State’s claims are within the
heartland of the EPA and DOJ’s expertise because they require interpretation of a statute
authorizing agency action. Thus, Defendants maintain that the Court lacks jurisdiction as
to the States claims in Count II-VII.
Page 41 of 77
Finally, Defendants argue that judicial review is unavailable as to the State’s
Administrative Procedure Act (“APA”) claims because the APA limits judicial review to
“those agency actions which otherwise lack an ‘adequate remedy in a court.’” Hinojosa v.
Horn, 896 F.3d 305, 310 (5th Cir. 2018) (per curiam) (quoting Bowen v. Mass., 487 U.S.
879, 903 (1988)); 5 U.S. C. § 704 (review available for “final agency action for which there
is no other adequate remedy in a court”).
Defendants explain that if the EPA or DOJ wanted to terminate funding on the basis
of any of the challenged regulations, notice would have to be given followed by an attempt
to resolve and provide a formal administrative hearing with that determination subject to
judicial review. See 40 C.F.R. § 7.130(b)(2); 42 U.S. C. § 2000d-2.
Here, Defendants’ post-suit abandonment considered by this Court as litigation
posturing (discussed above) prevented any resolution that would equate to a final agency
action and therefore judicial review under the APA is not possible.
The State argues that (1) that the Thunder Basin doctrine does not apply here, and
(2) even if it did, it does not preclude judicial review under the Thunder Basin factors. The
State maintains that 42 U.S.C. § 2000d-2 affirmatively confirms that judicial review is
available.
The State argues that Thunder Basin does not apply here because § 2000d-2 is not
a “special statutory scheme” that precludes district courts from exercising jurisdiction.
Rather, the State argues that § 2000d-2 clearly states that any agency action is reviewable,
whether final, post-enforcement, or neither. Section 2000d-2 provides as follows:
Page 42 of 77
Any department or agency action taken pursuant to section 2000d-1 of this

title shall be subject to such judicial review as may otherwise be provided by
law for similar action taken by such department or agency on other grounds.
In the case of action, not otherwise subject to judicial review, terminating or
refusing to grant or to continue financial assistance upon a finding of failure
to comply with any requirement imposed pursuant to section 2000d-1 of this
title, any person aggrieved (including any State or political subdivisions
thereof and any agency of either) may obtain judicial review of such action
in accordance with chapter 7 of Title 5, and such action shall not be deemed
committed to unreviewable agency discretion within the meaning of that
chapter.
United States v. Gonzales, 520 U.S. 1, 5 (1997) (“Read naturally, the word ‘any’ has an
expansive meaning, that is ‘one or some indiscriminately of whatever kind.’”) (citation
omitted)). The State remarks that the statute noticeably does not include the word “final,”
and the EPA’s interpretation nullifies Congress’s use of “any” and instead renders vast
swaths of “agency action taken pursuant to [Section 602]” unreviewable. The State also
remarks that the EPA’s interpretation obliterates the Statute’s use of the word “shall” 69
which normally creates an obligation impervious to judicial discretion.” Murphy v. Smith,
138 S.Ct. 784, 787 (2018). Lastly, the State argues that the EPA is relying solely on the
second sentence of the statute of § 2000d-2, that does not apply here because there is no
agency action that has taken place, due to the closure of the Complaints.
The Court agrees with the State and finds that 42 U.S.C. § 2000d-2 is not a special
statutory scheme and does not vest review in courts of appeal, nor does it provide any
comprehensive review process. It provides that “[a]ny agency actions taken pursuant to
section 2000d-1 of this title shall be subject to such judicial review.” 2000d-2. Thus, this
69
The Statute states that the EPA’s actions “shall be subject to judicial review.”
Page 43 of 77
Court has jurisdiction over the matter concerning the Defendants’ actions requiring
disparate and cumulative impact analysis in it permitting process or as a condition of grant
funding.
E. Final agency action as to APA challenges to the EPA and DOJ disparate impact
regulations (Counts III and IV)
Defendants do not dispute that the promulgation of a federal regulation constitutes
“final agency action.” 70
1. EPA and DOJ disparate-impact regulations (Counts III and IV)
Defendants argue that the State’s challenge to the EPA’s disparate impact rule under
the APA are untimely. Defendants assert that the rules were published over fifty years
ago and later amended over twenty years ago. Defendants point to 28 U.S.C. § 2401(a),
which bars civil actions not commenced within six years. See Dunn-McCampbell Royalty
Int., Inc. v. Nat’l Park Serv., 112 F.3d 1283, 1287 (5th Cir. 1997) (“On a facial challenge
to a regulation, the limitations period begins to run when the agency publishes the
regulation in the Federal Register.”). Additionally, Defendants argue that because the
obligations are not new but are conditioned on adherence to decades-old preexisting
regulations, a challenge to those regulations are time-barred.
To prevail on an as-applied challenge to the regulations, Louisiana must “show
some direct, final agency action involving the particular plaintiff within six years of filing
suit.” Id. Defendants contend that because the complaints were closed, and no action taken,
Defendant Memorandum in Support of Motion to Dismiss, Motion for Summary Judgment and Opposition, p. 29,
70
Doc. 29-1.
Page 44 of 77
the EPA imposed no rights or obligations upon the States for purposes of an as-applied
APA challenge.
The State alleges final agency action by way of the EPA’s application of its Title VI
disparate-impact regulations when responding to the LDEQ and LDH complaints. The
State contends that the EPA has changed the substantive character of the Title VI
obligations (conditioning permits, permit renewals and grants on disparate and cumulative
impact analysis) within the last six years, thereby creating new obligations.
Defendants argue that there is controlling precedent that an agency’s initiation of an
investigation does not constitute final agency action, citing Veldboen v. United States Coast
Guard, 35 F.3d 222, 225 (5th Cir. 1994). The State argues otherwise. The State contends
that permit renewals are challengeable as final agency action even though there are no
“new” obligations beyond the extension of obligations. See e.g., Animal Legal Def. Fund
v. USDA, 789 F.3d 1206, 1215 (11th Cir. 2015) (holding that “renewal of [company’s]
license [wa]s a final agency action subject to judicial review”).
The State explains that the APA defines “grant of money” as a form of “relief,” and
thus an “agency action.” 5 U.S.C. § 551 (11), (13). When the grant is executed (money
changes hands), there are legal consequences that flow that have a binding effect and
neither side can breach freely. Consequently, courts consider the grant of funds as a final
agency action. Courts have also found a final agency action prior to the release of funds
where the grant is conditioned upon eligibility criteria. See Planned Parenthood of New
York City, Inc v. HHS, 3374 F.Supp. 3d 308, 329 (S.D.N.Y. 2018).
Page 45 of 77
The State further asserts that by their nature Title VI obligations last as long as the
“program or activity [is] receiving Federal financial assistance,” 42 U.S.C.A. § 2000d,
causing the grant recipient to be bound to the Title VI obligations during the relevant time
period. Thus, because Title VI obligates recipients only for the term of the grant, the State
argues that new grants create new obligations by extending the time in which the recipient
is bound to Title VI mandates.
The State maintains that the conditions of a final agency action have been satisfied.
“[T]wo conditions must be satisfied for agency action to be ‘final’; First, the action must
mark the ‘consummation’ of the agency’s decisionmaking process—it must not be of a
merely tentative or interlocutory nature. And second, the action must be one by which
rights or obligations have been determined, or from which legal consequences will flow.”
Bennett v. Spear, 520 U.S. 154, 177-78 (1997) (cleaned up).
Here, both conditions are satisfied. The State has established that there is clearly a
substantive change as to the conditions the EPA now requires (disparate impact and
cumulative impact analysis) that are not tentative, but definite and certain. The State
submits the 2022 FAQ, which declares that “[i]n the context of Title VI investigations,
EPA considers cumulative impacts when evaluating whether there is an adverse impact
from the recipient’s policy or practice.” 71 Similarly, the EPA’s Cumulative Impacts
Addendum declares that Title VI “grants EPA the authority to consider cumulative impact’
71
Exhibit 46, p. 13.
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and further that “Addressing cumulative impacts is “integral to protecting civil rights.” 72
Also, the State submits evidence that the EPA has submitted proposed settlement
agreements that would have imposed cumulative-impact requirements to match its
regulations, 73 and Brian Israel, deputized to defend the EPA’s actions explained that “to
get a permit from this EPA or a state that is being guided or monitored by EPA, you have
to consider cumulative impacts.” 74 But even more telling, is that during the hearing on
these motions, the EPA consistently maintained its position, that it now requires disparate
impact and cumulative impact analysis as mandatory.
The Bennett factors are met. An action is binding “’if it either appears on its face
to be binding or is applied by the agency in a way that indicates it is binding.” Texas v.
EEOC, 933 F.3d 433, 442 (5th Cir. 2019). Consequently, to the extent funding grants have
been awarded by the EPA within the last six years, triggering Title VI obligations, under
the APA, the State can challenge the lawfulness of the Title VI obligations that require
disparate and cumulative impact analysis.
Defendants maintain that the challenge to the DOJ’s disparate-impact regulations
are untimely. The State argues the reopening doctrine. A plaintiff can challenge an agency
action past the ordinary timeline when an agency has reopened an issue. Alliance for
Hippocratic Med. v. FDA, 78 F.4th 210, 242 (5th Cir. 2023).
72
Exhibit 47, pp. 3-4.
73
Seidemann Declaration, ¶¶ 44-48; exhibit 82, Burdette declaration ¶ 11.
74
Exhibit 64, p. 3.
Page 47 of 77
The central inquiry under the reopening doctrine is whether the agency has
“undert[aken] a ‘serious, substantive reconsideration’” of its policy. Id. at 243 (citation
omitted). Merely taking public comments on the possible repeal and responding to them is
generally sufficient reconsideration to trigger a reopening. See, e.g., Ohio v. EPA, 838 F.2d
1325, 1328-29 (D.C. Cir. 1988).
The State asserts that in years 2020-2021, the DOJ attempted to repeal its disparate-
impact regulations. DOJ’s published regulations purport to impose disparate-impact-based
requirements. See, e.g., 28 C.F.R. § 42.104(b)(2). 75 The DOJ acted to rescind its disparate
impact regulations in 2020. 76 In its Amendment of Title VI Regulations (the
“Amendment”), the DOJ explained that the basis of its rescission, was Supreme Court
precedent that “established Title VI’s statutory prohibition extends only to intentional
discrimination,” 77 citing Regents of Univ. of Cal. v. Bakke, 438 U.S. 265, 287 (1978)
(Powell, J., announcing judgment; id. at 325, 328, 352 (Brennan, J., joined by White,
Marshall, and Blackmun, JJ., concurring in part); Washington v. Davis, 426 U.S. 229, 242
75
That Regulation provides states as follows:
A recipient, in determining the type of disposition, services, financial aid, benefits, or facilities which will be provided
under any such program, or the class of individuals to whom, or the situations in which, such will be provided under
any such program, or the class of individuals to be afforded an opportunity to participate in any such program, may
not, directly or through contractual or other arrangements, utilize criteria or methods of administration which have the
effect of subjecting individuals to discrimination because of their race, color, or national origin, or have the effect of
defeating or substantially impairing accomplishment of the objectives of the program as respects individuals of a
particular race, color, or national origin.
76
Exhibit 36, Doc. 12-36. The Summary of the DOJ’s Amendment of Title VI Regulations provides as follows:
AGENCY: Civil Rights Division, Department of Justice.
ACTION: Final Rule.
BILLING CODE: 4410-13
SUMMARY: The Department of Justice amends its regulations implementing Title VI of the
Civil Rights Act of 1964 ("Title VI") to align with the conduct Congress intended to prohibit
when enacting Title VI and to address concerns the Supreme Court raised in Alexander v.
Sandoval, 532 U.S. 275 (2001).
77
Id. p. 3,
Page 48 of 77
(1976) (finding the Equal Protection Clause required discriminatory intent, compared to
Title VII’s statutorily enacted disparate impact standard in employment); see also Vill. of
Arlington Heights v. Metro. Hous. Dev. Corp., 429 U.S. 252, 265 (1977) (“Proof of racially
discriminatory intent or purpose is required to show a violation of the Equal Protection
Clause”); Personnel Admin. of Mass. v. Feeney, 442 U.S. 256, 272 (1979) (“[E]ven if a
neutral law has a disproportionately adverse effect upon a racial minority, it is
unconstitutional under the Equal Protection Clause only if that impact can be traced to a
discriminatory purpose.”). And as noted, in 2001, the Supreme Court reaffirmed that Title
VI’s statutory prohibition extends only to intentional discrimination, Sandoval, supra.
However, after the Amendment was sent to OMB for review, it was inexplicably
never published in the Federal Register. Consequently, the State asserts that the DOJ’s
drafting of the Amendment, and then sudden decision to not publish and promulgate the
Amendment calls into question the constitutional validity of the 1966 Regulation.
Defendants argue that withdrawal of a draft rule does not constitute a final agency
action for purposes of the APA, therefore, the State’s claims against the DOJ are untimely.
The State argues that the DOJ’s withdrawal in 2021 of a draft rule which would have
eliminated disparate-impact requirements constitutes final agency action and is timely.
Defendants rely on GPA Midstream Ass’n v. DOT, 67 F.4th 1188, 1195 (D.C. Cir.
2023). Defendants argue that because the rule was not published, its lacks enforceability,
and thus it imposes no rights or obligations to be determined, nor can any legal
Page 49 of 77
consequences flow. Instead, Defendants argue that it is merely a tentative or interlocutory
step. Bennett, 520 U.S. at 177-78.
The State argues that the final agency action is the DOJ’s initial promulgation of tis
disparate impact mandates, and under the reopening doctrine, the States’ challenge to that
action is timely. Defendants remark that when the DOJ terminated the 2021 draft rule, it
did so before any proposal was promulgated, without soliciting written comments, and
undertaking the “serious, substantive reconsideration” required for reopening, citing All.
For Hippocratic Med. v. FDA, 78 F.4th 210, 243-44 (5th Cir. 2023); see also Kennecott
Utah Copper Corp. v. Dep’t of Interior, 88 F.33 1191, 1213 (D.C. Cir. 1996) (no reopening
“when the agency merely responds to an unsolicited comment by reaffirming its prior
position).
Here, the draft rule was never published in the Federal Register. However, the State
contends that in the Fifth Circuit, publication is not required. Arlington Oil Mills v. Knebel,
543 F.2d 1092, 1099-1100 (5th Cir. 1976) citing United States v. Aarons, 310 F.2d 341,
348 (2d Cir. 1962) (the lack of formal publication does not preclude the effectiveness of
an otherwise valid agency action.). Counsel for the State stated at the hearing that the draft
rule was published in the Washington Post 78 and thus, the State had actual knowledge, and
the ramifications of it being withdrawn were that the DOJ would be implementing and/or
enforcing disparate impact regulations.
78
Rough transcript, p. 58, 11:23 a.m.
Page 50 of 77
To be clear, the State is challenging the DOJ’s 1966 disparate impact regulations
under Title VI, after the DOJ seriously considered repeal of the Regulation post-Sandoval.
The State informs the Court that the Amendment was finalized by the DOJ and sent to the
Office of Management and Budget (“OMB”) for review, after which it was pulled and
never published.
After reviewing the Amendment carefully, the Court finds that the DOJ’s drafting
of the final Amendment as well as the substance of the Amendment itself, sending it to the
OMB for consideration, of which the State had notice of by publishing same in the
Washington Post, clearly indicates that the DOJ seriously considered the validity of the
1966 Regulation. As such, the reopening doctrine is applicable here under these
circumstances and the State’s challenge of the Regulation is timely.
Non-delegation on APA claims (Count II)
Although the Court has determined that the non-delegation claims are now moot,
we will address the claim on its merits. The State complains that during the complaint
process, Defendants granted private organizations the power to veto the continuation of an
informal resolution process that lasted more than 180 days—the prescribed time period.
Defendants note that when the complaint was filed the State and the private organizations
had already approved the extensions of negotiations. As noted by Defendants, the State
has not provided the Court with any evidence of any future proceedings that Defendants
have unconstitutionally granted governmental authority to private parties. While there may
Page 51 of 77
have been a non-delegation doctrine violation as to the abovementioned complaint
investigation, those complaints are now closed, and it would be speculative at this juncture
for the Court to decide if there is an Article III injury in fact.
2. “Extra-regulatory requirements’ as to APA violations (Count VI) and final

agency action
The State complains that the EPA has demanded that the State submit to new
requirements (that include the evaluation of cumulative impacts). Defendants argue that
the State has failed to identify any final agency actions as to its “extra-regulatory
requirements” and that the EPA’s proposals are tentative and interlocutory, which does not
obligate the State to comply, particularly because the complaints were closed.
Defendants remark that the States’ passing reference to two recent EPA guidance
documents (2022 FAQ and 2023 Cumulative Impacts Addendum) both disclaim any power
to “create, expand, or limit any legal rights, obligations, responsibilities, expectations or
benefits.” 79 Defendants contend that the closed complaints disavow these documents as
binding because the State faced no obligation to obey the complained-of “extra-regulatory
requirements.”
Defendants also argue that proposals attempting to achieve voluntary resolution of
a Title VI complaint are not enforceable “rules, regulations, or orders” within the meaning
of 42 U.S.C. § 2000d-1, nor are they regulations subject to APA rulemaking requirements.
Additionally, Defendants argue that EPA guidance documents are not binding rules,
79
Docs. 12-46 and 12-47.
Page 52 of 77
regulations, or orders, and nothing in those guidance documents equate to a binding
requirement on the State. See Equity In-Athletics, Inc. v. Dep’t of Educ., 639 F.3d 91, 106
(4th Cir. 2011)
The State points to the June 16 Objection to support its position that these extra-
regulatory requirements are not tentative or interlocutory. However, Defendants informed
the Court that this particular permit which prompted the EPA’s objection, was issued. 80
Defendants contend that the cover letter concerning the Objection was not a mandatory
requirement, but a reminder by the EPA of the LDEQ’s civil rights obligations.
The Court finds that the State’s claim concerning extra-regulatory requirements are
not a final agency action under the APA, and thus not reviewable as such.
3. Non-statutory causes of action
As an alternative cause of action, the State seeks non-statutory “ultra vires”
review. 81 The State has asserted three types of non-APA claims: (1) claims arising from
the Constitution, (2) claims at equity, and (3) non-statutory claims challenging ultra vires
actions. An act is ultra vires only if it is “without any authority whatsoever” or is “made
without any colorable basis for authority.” Danos v. Jones, 652 F.3d 577, 583 (5th Cir.
2011).
Defendants contend that claims of agency action in excess of statutory or
constitutional authority are properly pled under the APA, not as ultra vires claims, citing
80
Exhibit E, Doc. 34-5.
81
Complaint, ¶ ¶ 209, 220, 230, 246, 249, 253 (Counts I, III, IC V and VI).
Page 53 of 77
e.g., Gen.Fin. Corp. v. FTC, 700 F.2d 366, 368 (7th Cir. 1983) (“You may not bypass the
specific method that Congress has provided for reviewing adverse agency action. . .”)
(citing 5 U.S.C. § 703, 704).
Ultra vires review is a “rarely invocable,” “narrow exception” to the APA’s final
agency action requirement that permits judicial intervention for only the most “egregious
error[s]” where a party is “wholly deprive[d] . . . of a meaningful and adequate means of
vindicating its rights.” Am. Airlines, Inc. v. Hermann, 176 F.3d 283, 293-94 (5th Cir. 1999);
see also Leedom v. Kyne, 358 U.S. 184 (1958); Am. Sch. of Magnetic Healing v. McAnnulty,
187 U.S. 94, 110 (1902).
To support such a claim, allegations that an agency has acted in excess of statutory
authority may not “simply involve a dispute over statutory interpretation.” See Kirby Corp.
v. Pena, 109 F.3d 258, 269 (5th Cir. 1997); Exxon Chem. Am. v. Chao, 298 F.3d 464, 469
(5th Cir. 2002) (rejecting jurisdiction based on the Kyne exception where the plaintiff “can
obtain meaningful judicial review” upon exhausting administrative proceedings). And
courts may not engage in ultra vires review to “police” the “purity” of hypothetical agency
actions “long before the administrative process is over.” Sanderson Farms, Inc. v. NLRB,
651 F. App’x 294, 298 (5th Cir. 2016).
The State contends that its equitable and constitutional claims are not subject to the
rigorous limitations in Kyne. As to its equitable cause of action, the State relies on Free
Enterprise Fund v. Pub. Co. Acct. Oversight Bd, 561 U.S. 477, 491 n.2 (2010) to recognize
the availability of that type of action, and not consider that type of claim as being Kyne-
Page 54 of 77
based or “ultra vires”), citing generally, id.; Correctional Services Corp. v. Malesko, 534
U.S. 61 (2001); Bell v. Hood, 327 U.S.678 (1946); Ex Parte Young, 209 U.S. 123 (1908).
The State argues that these cases permitted direct review of the legality of the challenged
acts without any need to satisfy the Kyne or Kyne-like obstacles Defendants are asserting
here. To be more succinct, the State asserts that federal courts do not impose Kyne
limitations when the question for review is whether state officials are complying with
federal law. The State contends that the same result should be reached when federal
officials violate federal law.
As to the constitutional challenges, the State argues that its non-statutory ultra vires
claim easily passes muster under Fifth Circuit precedent, citing Cochran v. SEC, 20 F.4th
194, 199-200 (5th Cir. 2021) (en banc), which the Supreme Court affirmed in Axon, supra.
The State intends to “use[] the APA to assert a ‘non-statutory cause of action’—such as an
ultra vires claim.” Apter v. HHS, 80 F.4th 579, 585 (5th Cir. Sept. 1, 2023) (discussing
three potential paths).
The State asserts that it must satisfy two requirements: (1) “identify some agency
action affecting [it] in some specific way; and (2) “show that [it] has been adversely
affected or aggrieved by that action.” Id. “The action need not be final” and the State notes
that there is no mention of Kyne’s hurdles in Apter. Id. To satisfy the aggrievement
requirement, “the plaintiff must establish that the injury he complains of falls within the
‘zone of interest’ sought to be protected by the statutory provision whose violation forms
the legal basis for his complaint.” Louisiana v. United States, 948 F.3d 317, 321 (5th Cir.
Page 55 of 77
2020) (internal quotation marks omitted) (quoting Lujan, 497 U.S. at 883, 110 S.Ct. 3177).
The State argues that the two Apter requirements are easily met.
First, the State argues that there is an agency action. The agency-action requirement
is governed by the APA’s definition of “rule,” which is defined “broadly enough to include
virtually every statement an agency may make,” including “‘non-binding agency policy
statements and guidance documents interpreting existing rules.’” Avoyelles Sportsmen’s
League, Inc. v. Marsh, 715 F.2d 897, 908 (5th Cir. 1983); see F.T.C. v. Standard Oil Co.
of Cal., 449 U.S. 232, 238 n. 7, 101 S.Ct. 488, 494 (1980); see also Batterton v. Marshall,
648 F.2d 694, 700 (D.C. Cir. 1980) (“The breadth of this definition [of ‘rule’] cannot be
gainsaid.”).
Here, the State maintains there is “agency action” in the form of EPA’s demands
that the State comply with disparate-impact and cumulative-impact mandates, as reflected
in inter alia: (1) Defendants’ disparate-impact regulations, (2) EPA’s letter of concern, (3)
EPA’s June 16 Objection, and (4) EPA’s cumulative-impacts guidance documents.
Similarly, the State relies upon EPA’s March 2023 decision to allow Sierra Club to make
the decision about whether to extend informal proceedings was agency action. To establish
the aggrievement requirement the State’s relies on its reasons explained regarding standing
and irreparable injury.
The State argues, again relying on Apter, that it satisfies the substantive
requirements for the non-statutory ultra vires claims that it asserts. The State remarks that
in Apter, it was sufficient that plaintiffs asserted that FDA lacked authority to “recommend
Page 56 of 77
treatments or give other medical advice.” 2023 WL 5664191, at *5. And even though FDA
possessed authority to “‘make public statements’”—which might involve some line-
drawing exercises between “statements” and “advice”—the plaintiffs had stated a valid,
non-statutory, ultra vires claim because it was sufficient to argue that “FDA d[id] not have
express authority to recommend against off-label uses of drugs approved for human use.”
Id. at *5-6.
The State contends that, a fortiori, its claims are more categorical in that (1) the
EPA was wholly without power to delegate governmental authority to private Special
Interest Groups, (2) Defendants are entirely without authority to impose disparate impact
mandates, both generally and specifically under the Spending Clause, and (3) Defendants
are entirely without power to enforce substantive mandates under Title VI without
obtaining Presidential ratification and complying with the APA rulemaking requirements.
Defendants argue that they have pointed to statutory text that expressly authorizes
them to effectuate Title VI’s broad prohibition on discrimination, under Kyne, which
carries a stricter burden. 82 The Court disagrees based on discussions expressed herein
below. The Court finds that the State has viable non-APA causes of action as to its claims
arising from the Constitution, and non-statutory claims challenging Defendants’ ultra vires
actions. 83
82
The complaint must allege facts sufficient to establish that the officer was acting without any authority whatever,
or without any colorable basis for the exercise of authority. Apter, 80 F.4th at 587-588.
83
The Court will pretermit any decision as to the States’ claims at equity.
Page 57 of 77
II. FAILURE TO STATE A CLAIM/MOTION FOR SUMMARY JUDGMENT
Defendants maintain that even if the Court finds that it has subject matter
jurisdiction, Plaintiffs claims must be dismissed for failure to state a claim under Rule
12(b)(6) of the Federal Rules of Civil Procedure, or in the alternative, summary judgment
should be granted to Defendants pursuant to Rule 56 of the Federal Rules of Civil
Procedure.
RULE 12(b)(6) STANDARD
Rule 12(b)(6) allows for dismissal when a plaintiff “fail[s] to state a claim upon
which relief can be granted.” When reviewing such a motion, the court should focus on the
complaint and its attachments. Wilson v. Birnberg, 667 F.3d 591, 595 (5th Cir. 2012). The
court can also consider documents referenced in and central to a party’s claims, as well as
matters of which it may take judicial notice. Collins v. Morgan Stanley Dean Witter, 224
F.3d 496, 498–99 (5th Cir. 2000); Hall v. Hodgkins, 305 Fed. App’x 224, 227 (5th Cir.
2008) (unpublished).
Such motions are reviewed with the court “accepting all well-pleaded facts as true
and viewing those facts in the light most favorable to the plaintiff.” Bustos v. Martini Club,
Inc., 599 F.3d 458, 461 (5th Cir. 2010). However, “the plaintiff must plead enough facts
‘to state a claim to relief that is plausible on its face.’” In re Katrina Canal Breaches Litig.,
495 F.3d 191, 205 (5th Cir. 2007) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570
(2007)). Accordingly, the court’s task is not to evaluate the plaintiff’s likelihood of success
Page 58 of 77
but instead to determine whether the claim is both legally cognizable and plausible. Lone
Star Fund v. (U.S.), L.P. v. Barclays Bank PLC, 594 F.3d 383, 387 (5th Cir. 2010).
SUMMARY JUDGMENT STANDARD
A court should grant a motion for summary judgment when the movant shows “that
there is no genuine dispute as to any material fact and the movant is entitled to judgment
as a matter of law.” FED. R. CIV. P. 56. The party moving for summary judgment is initially
responsible for identifying portions of pleadings and discovery that show the lack of a
genuine issue of material fact. Tubacex, Inc. v. M/V Risan, 45 F.3d 951, 954 (5th Cir. 1995).
The court must deny the motion for summary judgment if the movant fails to meet this
burden. Id.
If the movant makes this showing, however, the burden then shifts to the non-
moving party to “set forth specific facts showing that there is a genuine issue for trial.”
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986) (quotations omitted). This
requires more than mere allegations or denials of the adverse party's pleadings. Instead, the
nonmovant must submit “significant probative evidence” in support of his claim. State
Farm Life Ins. Co. v. Gutterman, 896 F.2d 116, 118 (5th Cir. 1990). “If the evidence is
merely colorable, or is not significantly probative, summary judgment may be granted.”
Anderson, 477 U.S. at 249 (citations omitted).
A court may not make credibility determinations or weigh the evidence in ruling on
a motion for summary judgment. Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S.
133, 150 (2000). The court is also required to view all evidence in the light most favorable
Page 59 of 77
to the non-moving party and draw all reasonable inferences in that party’s favor. Clift v.
Clift, 210 F.3d 268, 270 (5th Cir. 2000). Under this standard, a genuine issue of material
fact exists if a reasonable trier of fact could render a verdict for the nonmoving party.
Brumfield v. Hollins, 551 F.3d 322, 326 (5th Cir. 2008).
A. Non-delegation claim (Count 1)
Despite finding that the non-delegation claim was moot, the Court will consider the
States claims on the merits. Defendants maintain that the State has failed to assert a claim
under the non-delegation doctrine because it does not contend that Congress has sought to
vest legislative power in a private entity. The State contends that during the informal
resolution process, the EPA sought consent from the complainant (Private Special Interest
Groups) to extend the 180-day deadline to issue preliminary findings of discrimination.
The State argues that the EPA violated the APA’s non-delegation doctrine, citing National
Horsemen’s Benevolent & Protective Ass’n v. Black, 53 F.4th 869, 880 (5th Cir. 2022)
(“Our Constitution permits only the federal government to exercise federal power.”). The
State maintains that this foundational principle is violated whenever governmental power
is delegated to private groups, whether the perpetrator is Congress or the Executive.
The nondelegation doctrine prohibits Congress from vesting other entities with
“powers which are strictly and exclusively legislative.” Gundy v. United States, 139 S.Ct.
2116, 2123 (2019) (internal quotes and citations omitted).
Here, the State complains that in exchange for the Sierra Club’s (a Private Special
Interest Group and Complainant) blessing to extend the 180-day deadline, the EPA agreed
Page 60 of 77
to provide the Sierra Club with non-public information. The State considers this to be a
transfer of governmental power to that group that violates the nondelegation doctrine.
The State explains that in March 2023, Sierra Club could have compelled the EPA
to either issue a formal finding of violations or terminate its investigation entirely.
However, the State posits that Sierra Club was able to compel the EPA to exercise
government power by extending that deadline. Thus, the State suggests that Sierra Club
had a commanding role and EPA was compelled to follow its direction, which was a
delegation of its powers contravening the APA, specifically, 5 U.S.C. § 706(2)(B). The
State further suggests that the EPA’s actions were arbitrary and capricious. § 706(2)(A).
The State bases its arguments on the failure of the EPA to rationalize its sought-
after extension, which it argues violates the APA. See, e.g., Dillmon v. NTSB, 588 F.3d
1085, 1089-90 (D.C. Cir. 2009) (“‘[A]gency action is arbitrary and capricious if it departs
from agency precedent without explanation.’” (citation omitted). The State also complains
that the EPA never explained why it conferred rights purely on the Private Special Interest
Groups suggesting that it favored certain groups. The State seeks a judgment in its favor
as to Count II—violation of the non-delegation doctrine.
Defendants argue that because the action was not by Congress, it fails to meet the
basic requisites of a nondelegation claim and granting the extension was a procedural
condition and not an exercise of governmental power. Defendants also argue that despite
the 180-day deadline, an exception to this promptness requirement exists where it believes
informal resolution of the complaint is possible and both the complainant and the funding
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recipient “agree to a delay pending settlement negotiations.” 40 C.F.R. § 7.120. See Rettig,
987 F.3d 518, 531 (5th Cir. 2021) (“an agency does not improperly subdelegate its
authority when it ‘reasonabl[y] condition[s]’ federal approval on an outside party’s
determination of some issue; such conditions only amount to legitimate requests for
input.”) (quoting U.S. Telecom Ass’n v. FCC, 359 F.3d 554, 566-67 (D.C. Cir. 2004)
(alterations in original).
Here, while the Court finds the EPA’s conduct regarding the extension suspect, the
Court finds that seeking permission of Sierra Club for the extension was not a delegation
of legislative authority. As such, the States claims against Defendants are entitled to the
dismissal of the State’s non-delegation claim.
B. Disparate-impact regulations (Counts III, IV, and V)
The State maintains that Title VI does not impose any disparate-impact-based
requirements, citing Sandoval, supra. The State argues that Defendants are attempting to
create extra-textual disparate-impact mandates under Title VI by regulation, but § 602
gives them no power to do so. The State relies on Title VI’s plain text, reinforced by the
statutory context, the applicable canons of construction, the doctrine of constitutional
avoidance, and the major questions doctrine.
Section 601 of Title VI ensures that “[n]o person in the United States shall, on the
ground of race, color, or national origin, be excluded from participation in, be denied the
benefits of, or be subjected to discrimination under any program or activity receiving
Federal financial assistance.” 42 U.S.C. § 2000d. Section 602, in turn, “authorize[s] and
Page 62 of 77
direct[s]” each Federal agency responsible for distributing federal funds to “effectuate”
Section 601 “by issuing rules, regulations, or orders of general applicability.” 42 U.S.C. §
2000d-1.
Defendants, relying on Guardian Ass’n v. Civil Serv. Comm’n of N.Y., 463 U.S. 582,
607 n. 27 (1983) (opinion White, J.) maintain that § 601 does not undercut the validity of
its disparate-impact regulations, issued under § 602. Defendants argue that its regulations
are fully consistent with § 602’s directive to federal agencies to “effectuate” § 601’s
prohibition on intentional discrimination.
Defendants argue that its discriminatory-effect regulations are prophylactic
measures that “effectuate” Section 601’s prohibition on intentional discrimination in two
ways: (1) to root out intentional discrimination that is otherwise hard to detect or prove;
and (2) to ensure that programs accepting federal funds are not perpetuating the effects of
past intentional discrimination.
In Guardians, five Justices “form[ed] a majority for upholding the validity of the
regulations incorporating a disparate impact standard.” 463 U.S. at 607 n.27 (opinion of
White, J.); see also id. at 623 n.15 (Marshall, J., dissenting); id. at 642-45 (Stevens, J.,
joined by Brennan and Blackmun, JJ., dissenting). The Court later reaffirmed that it had
“held [in Guardians] that actions having an unjustifiable disparate impact on minorities
could be redressed through agency regulations designed to implement the purposes of Title
VI.” Alexander v. Choate, 469 U.S. 287, 293 (1985).
Page 63 of 77
However, the State argues that Guardians has no precedential effect based on Marks
v. United States, which holds that “[w]hen a fragmented Court decides a case and no single
rationale explaining the result enjoys the assent of five Justices, the holding of the Court
may be viewed as that position taken by those Members who concurred in the judgment on
the narrowest grounds.” 430 U.S. 188, 193 (1977). The State points out that in Guardians,
the Supreme Court held that “in the absence of proof of discriminatory animus,
compensatory relief should not be awarded to private Title VI plaintiffs.” 463 U.S. at 584.
The State argues that Marks makes plain that the only positions that count come from
“[m]embers who concurred in the judgment[].”430 U.S. at 193; accord Whole Woman’s
Health v. Paxton, 10 F.4th 430, 440 (5th Cir. 2021) (en banc) (the Marks “principle ‘is only
workable where there is some common denominator upon which all of the justices of the
majority can agree.”) (citation omitted).
In Sandoval, the Court considered whether a private right of action existed to
enforce the disparate impact regulations promulgated by DOJ and DOT. Id. at 278. The
Court acknowledged that, although fractured across multiple opinions, “five Justices in
Guardians voiced [their] view,” as alternative grounds for their decisions, that the
regulations promulgated under Section 602 “may validly proscribe activities that have a
disparate impact on racial groups, even though such activities are permissible under § 601.”
Id. at 281-82 (citations omitted). In discussing Guardians, the Sandoval Court explained
that “no opinion of this Court has held” that “regulations promulgated under § 602 of Title
Page 64 of 77
VI may validly proscribe activities that have a disparate impact on racial groups” even
though “five Justices in Guardian voiced that view.” 533 U.S. at 281.
Defendants argue that the Fifth Circuit has recognized that Sandoval “left untouched
Choate’s apparent approval of the promulgation and enforcement of disparate-impact
regulations by federal agencies.” Rollerson v. Brazos River Harbor Navigation Dist. of
Brazoria Cnty., 6 F.4th 633, 643 (5th Cir. 2021). Of note, two judges expressed doubts
about the underlying conclusions in Guardians and Choate, id. at 647 (Jones, J.,
concurring); id. at 648-50 (Ho, J., concurring in part). However, the State notes that the
opinion in Rollerson, expressly stated that “there is a reasonable argument that Choate’s
approval of such regulations was mere dictum,” rather than a holding and the panel only
“assume[d] arguendo that the DOD’s disparate-impact regulation [we]re valid.” 6 F.4th at
643 no. 6.
The State agrees that § 601 unambiguously prohibits intentional discrimination, but
argues that the contours of that prohibition and Defendants’ authority to “effectuate” it
must be unambiguously clear to bind States to the specific requirement at issue. Arlington
Central; Cummings v. Premier Rehab Keller, P.L.L.C., 142 S.Ct. 1562 (2022). The State
argues that needed clarity cannot be so provided by regulation but must come directly from
the statute, Texas Educ. Agency v. U.S. Dep’t of Educ., 992 F.3d 350, 361 (5th Cir. 2021),
and imposing disparate-impact liability to effectuate § 601 transforms the statute into
something radically different.
Page 65 of 77
The State notes the apparent conflict between disparate impact mandates and §
601’s prohibition against intentional discrimination. See Ricci v. DeStefano, 557 U.S. 557
(2009) (noting that disparate impact and intentional discrimination have two different
standards—one requires proof of intent and the other does not).
The State argues that its disparate-impact claims are most easily resolved under the
Spending Clause, which forbids imposition of any conditions that are not unambiguously
established in statutory text. Arlington Central, 548 U.S. at 293-94. The State maintains
that Title VI’s text does not unambiguously impose any potential disparate-impact liability.
As noted by the State, the Supreme Court has recently applied this principle to Title VI,
holding that emotional distress damages were unavailable because ‘if Congress intends to
impose a condition on the grant of federal monies, it must do so unambiguously.’”
Cummings, 142 S.Ct. at 1569-70 (citations omitted) (emphasis added).
In Brnovich v. DNC, in its original iteration, § 2 of the Voting Rights Act (“VRA”)
lacked disparate impact/effects language. 141 S.Ct. 2321 (2021). The Supreme Court held
that it prohibited only intentional discrimination. Id. Congress responded by adding explicit
“results” language in the VRA, prohibiting some practices that “result[] in a denial or
abridgement of the right” to vote. 52 U.S.C. § 10301(a) (emphasis added). But even with
that express “results” language that explicitly goes beyond intentional discrimination, that
was still insufficient to justify full-blown Title-VII-like disparate impact regulations. See
Brnovich, 141 S. Ct. at 2340 (“We also do not find the disparate-impact model employed
in Title VII and Fair Housing Act cases useful here…. Demanding such a tight fit” was
Page 66 of 77
unsupportable.). The Court thus expressly rejected such a “freewheeling disparate-impact
regime.” Id. at 2341.
The State urges the Court to also consider two other cases that invite doubt as to the
constitutionality of Defendants’ disparate impact regulations. See Parents Involved in
Cmty. Sch. v. Seattle Sch. Dist. No. 1, 551 U.S. 701 (2007); Students for Fair Admissions,
Inc. v. President & Fellows of Harvard Coll., 143 S.Ct. 2141 (2023). The State also notes
that in Kamps v. Baylor University, 592 F.App’x 282 (5t h Cir. 2014) (“[w]hen Congress
wants to allow disparate impact claims, it uses particular language”). There, the Fifth
Circuit held that there was no private right of action for disparate impact under the ADA
because § 601 of Title VI only prohibited intentional discrimination. Id.
The State maintains that Defendants’ regulations also fail under the major questions
doctrine. The major questions doctrine demands “‘clear congressional authorization’ for
the power [the government] claims” when the question posed is a “major” one. West
Virginia v. EPA, 142 S.Ct. 2587, 2609 (2022) (citation omitted).
The State argues that the issue of Defendants’ authority to impose disparate-impact
mandates (1) is a “matter of great political significance,” (2) seeks to regulate a significant
portion of the American economy,” and (3) “intrud[es] into an area that is the particular
domain of state law.” West Virginia, at 2620-21 (Gorsuch, J., concurring).
Defendants argue that the doctrine is not applicable because its regulations have
been part of its regulatory approach since the agency’s inception more than fifty years
Page 67 of 77
ago. 84 Thus, Defendants posit that its disparate impact regulations are not a “transformative
expansion in [its] regulatory authority.” (quoting West Virginia, 142 S.Ct. at 2609).
The State refers the Court to Alabama Realtors and NFIB where the Supreme Court
did not consider or mention putative “transformational expansion” of “long-extant
statutes.” Alabama Ass’n of Realtors v. HHS, 141 S.Ct. 2485, 2489 (2021); NFIB v. OSHA,
142 S.Ct. 661, 664-65 (2022). Be that as it may, the State argues that Defendants’ mandates
are a transformational expansion because they transform Title VI from pure intentional
discrimination only, into a “freewheeling disparate-impact regime” akin to Title VII. See
Brnovich, 141 S.Ct. at 2340-41. Thus, the State posits that the EPA’s construction of § 602
results in a transformation of the agency’s Clean Air Act authority, converting the statute
from one regulating specific pollutants and environmental impacts into a tool for far-
reaching social engineering in the name of “equity.”
The State urges the Court to not give deference to the EPA’s interpretation of Title
VI as authorizing disparate-impact liability because the question is of “deep ‘economic and
political significance.’” King v. Burwell, 576 U.S. 473, 486 (2015) (citation omitted). The
State asserts that deference is not warranted since Congress typically resolves the question
of whether civil rights statutes permitted disparate impact liability, as well as the
constitutional doubts raised by Defendants’ interpretation. See Solid Waste Agency of N.
84
Defendants rely on the Model Title VI regulation that was promulgated in 1964 and the DOJ’s regulation that was
promulgated in 1966.
Page 68 of 77
Cook Cnty. v. U.S. Army Corps of Engineers, 531 U.S. 159, 173 (2001) (“floor statements
by individual legislators rank among the least illuminating forms of legislative history.”).
The State argues that Defendants’ resort to legislative history is unpersuasive
because they rely on a single floor statement and second statement by a non-legislator,
NLRB v. SW Gen., Inc., 137 S.Ct. 929, 943 (2017) that did not address disparate impact
specifically. Additionally, the State argues that the Court should not consider
Congressional inaction as ratification. See Brown v. Gardner, 513 U.S. 115, 121)
(“[C]ongressional silence lacks persuasive significance ... particularly where
administrative regulations are inconsistent with the controlling statute.”)
Instead, the State urges the Court to consider that in 1991, Congress codified
disparate impact liability to Title VII, but did not codify disparate impact liability to Title
VI. The Court considers the inaction of Congress as to Title VI to be particularly
compelling that militates against ratification and finds that the State has established that
the question as to whether Title VI imposes liability for disparate impact is a question of
major importance.
The State posits and this Court agrees, that Guardians has no precedential effect as
to the validity of disparate impact regulations under Title VI. The Court notes that
Guardians did not evaluate § 602 under the unambiguous-clarity standard that the
Spending Clause doctrine demands. Section 601 plainly prohibits intentional
discrimination. Reliance upon 602 to effectuate § 601 does not morph § 601 to include
discrimination by disparate impact mandates that remove the element of intent.
Page 69 of 77
Additionally, the Court finds that under the Spending Clause, the grant recipients have a
right to be on notice as to the conditions that are attached to grants. Defendant’s use of §
602 to impose disparate impact regulations are not unambiguously established in the
statutory text. Arlington Central, at 296 (the Spending Clause prohibits enforcement of
any condition that is not “set out ‘unambiguously’” in the statutory text; Cummings, 142
S.Ct. at 1569-70 (damages were unavailable because ‘if Congress intends to impose a
condition on the grant of federal moneys, it must do so unambiguously.’”).
The Court agrees with the State that the major questions doctrine is applicable here
as to the imposition of disparate impact mandates under Title VI and as such, demands
clear congressional authorization. Here, the issue is whether Congress in fact meant to
confer the power these agencies have asserted—to impose disparate impact liability under
Title VI. The Court finds that this is an extraordinary case, of economic and political
significance. Defendants have constructed Title VI to allow it to regulate beyond the
Statute’s plain text and by doing go, invade the purview of the State’s domain. Common
sense dictates otherwise. Accordingly, Defendants motion to dismiss under Federal Rule
of Civil Procedures 12(b)(6) and Rule 56 will be denied.
C. “Extra-regulatory requirements” claim
Having concluded that the challenged extra-regulatory requirements that required
cumulative impact mandates are not reviewable under the APA, the Court does consider
them as a challenge under the Constitution and as a non-statutory claim challenging an
ultra vires act. The State asserts that the EPA violated Title VI by its extra-regulatory
Page 70 of 77
requirements and argues that they are unlawful. Defendants argue that the proposals or
suggestions offered during negotiations were not enforceable rules, regulations or an order
that would require presidential approval. Defendants further argue that the two agency
documents concerning cumulative impact mandates were merely guidance, and not
enforceable rules, regulations or an order.
The State points to the June 16th Objection wherein the EPA demanded evaluation
of cumulative impacts and insisted that the State consider “whether the community is
already disproportionately impacted by public health or environmental burdens. 85
Additionally, the EPA’s letter of concern demands that the State “[c]onduct cumulative
impact analyses” and sets a “minimum” for what those analyses should contain. 86 The State
notes that Defendants have not disavowed, and has vigorously defended, their position that
Title VI and the EPA’s regulations demand consideration of cumulative disparate impacts
and conducting public meetings.
The State argues that the EPA cannot interpret § 601 to mandate through guidance,
cumulative impact requirements, but it must create them by legislative rulemaking. See
e.g., United Technologies Corp. v. EPA, 821 F.2d 714, 719-20 (D.C. Cir. 1987) (holding
that if a “rule is based on an agency’s power to exercise its judgment as to how best to
implement a general statutory mandate, the rule is likely a legislative one”). During oral
arguments, the Court inquired of counsel for Defendants if the EPA required cumulative
85
Exhibit 84, p. 2.
86
Exhibit 11, p. 5-7.
Page 71 of 77
impact analysis on every air permit issued in the state to which counsel explained that “it
is certainly best practices to engage in a type of statistical analysis to see the significant
disparate impact, ... or if there are alternative less discriminatory measures to mitigate that
impact . . . what the regulation requires is that they don’t engage in unlawful disparate
impact. 87 As noted by the State, such legislative rulemaking requires notice-and-comment
compliance and Presidential ratification.
The Court agrees with the State that the EPA’s demands of cumulative impact
analyses was more than suggestions. Based on the Court’s understanding as explained in
the briefs, the attached exhibits, and arguments made during the hearing, it appears that the
EPA has and will continue to impose cumulative impact analysis as conditions for grants,
and with regard to issuing permits. Most telling, was counsel for Defendants who refused
to disavow the imposition of the mandates, and further stated that the EPA would continue
to consider such analyses as best practices concerning issuing permits. 88 As such, there is
a real threat of enforcement as to those mandates and the EPA’s “guidance” is actually
binding. The Court finds that these mandates are more than mere negotiating proposals or
suggestions, and thus the Court will deny Defendants’ motion to dismiss the States’ claims
challenging the extra-regulatory requirements.
87
Rough transcript, p. 49-50 at 11:11a.m.
88
Id. pp. 49-51.
Page 72 of 77
III. PRELIMINARY INJUNCTION
To obtain a preliminary injunction, a plaintiff “must show: (1) a substantial
likelihood of success on the merits; (2) a substantial threat of irreparable harm if the
injunction is not granted; (3) that the threatened injury outweighs any harm that the
injunction might cause to the defendant; and (4) that the injunction will not disserve the
public interest.” Opulent Life Church v. City of Holly Springs, Miss., 697 F.3d 279, 288
(5th Cir. 2012); accord Winter v. NRDC, 555 U.S. 7, 20 (2008). Failure to satisfy any one
requirement precludes injunctive relief, see Allied Mktg. Grp., Inc. v. CDL Mktg., Inc., 878
F.2d 806, 809 (5th Cir. 1989), and the State bears a heavy burden on each requirement.
Enter. Int’l, Inc. v. Corporacion Estatal Petrolera Ecuatoriana, 762 F.2d 464, 472 (5th
Cir. 1985). The “limited purpose” of a “preliminary injunction is merely to preserve the
relative positions of the parties until a trial on the merits can be held.” Univ. of Tex. V.
Camenisch, 451 U.S. 390, 395 (1981); see also SEC v. First Fin. Group of Tex., 645 F.2d
429, 435 n.8 (5th Cir. Unit A 1981).
As discussed hereinabove, the Court has determined that it has standing as to the
State’s to Challenge Defendants’ disparate impact regulations and extra-regulatory
requirements and for the reasons explained herein, the Court is convinced that the State has
a substantial likelihood of success.
A. Irreparable harm
Defendants argue that the State cannot make a clear showing of irreparable harm
given the State’s alleged fifty-year delay in bring the motion for preliminary injunction and
Page 73 of 77
the absence of imminent injury. Defendants argue that the balance of equities and public
interest disfavor preliminary relief because of the disruption of longstanding agency
operations such an injunction would cause.
To show irreparable harm, Plaintiff must demonstrate “a significant threat of injury
from the impending action, that the injury is imminent.” Humana, Inc. v. Jackson, 804 F.2d
1390, 1394 (5th Cir. 1986) (emphases added), and that irreparable injury must be likely to
occur “during the pendency of the litigation.” Justin Indus., Inc. v. Choctaw Secs., L.P.,
920 F.2d 262, 268 n.7 (5th Cir. 1990).
1. Fifty-year delay
Defendants contend that the State’s half-century delay suggest that the EPA and
DOJ’s disparate impact regulations disproves any irreparable harm. Defendants note that
the regulations to which the State complains were issued in 1966 (DOJ) and 1973 (EPA),
and the Louisiana State agencies have for decades certified their compliance with the
disparate impact regulations, refuting any suggestion that harm from such compliance is
irreparable. In simple terms, Defendants posit that the State’s substantial delay in
challenging the regulations negates any assertion that such harms are irreparable.
B. Injuries
Defendants argue that the State’s harms do not rise to the level of imminent,
irreparable injury. Defendants remind the Court that the EPA closed the complaints that
initially precipitated the State’s concerns as to the disparate impact mandates. Thus,
because there are no pending complaints, there can be no imminent, irreparable injury.
Page 74 of 77
Defendants argue that any harm arising from potentially adverse outcomes in future
enforcement proceedings is insufficiently imminent to justify a preliminary injunction.
Winter, 555 U.S. at 22.
The State asserts that it will suffer sovereign injury because the challenged
regulations prevent it from “exercise[ing] its sovereign authority by regulating in a race-
neutral manner. As sovereigns within our federal system, the States have “the power to
create and enforce a legal code” within their borders. Alfred L. Snapp & Son, Inc. v. Puerto
Rico, 458 U.S. 592, 601 (1982).
The State argues that is has a sovereign right to unambiguous clarity in the
conditions being imposed by federal grants, and Title VI’s plain text fails to provide
unambiguous clarity that accepting federal funds will compel the State to accept disparate
impact based requirements. See e.g., Arizona v. Yellen, 34 F.4th 841, 852 (9th Cir. 2022).
Thus, the State maintains that Defendants’ actions inflict sovereign injury.
Additionally, the State argues that Defendants’ disparate impact regulations and
extra-regulatory requirements create compliance costs for the State, and due to its
sovereign immunity, the States cannot recover damages from the federal government. As
such, the State posits that those irrecoverable injuries constitute irreparable harm. See e.g.
Texas v. United States, 809 F.3d 134, 186 (5th Cir. 2015), aff’d by, 136 S.Ct. 2271 (2016);
East Bay Sanctuary Covenant v. Trump, 950 F.3d 1242, 1280 (9th Cir. 2020).
Based on the discussions herein, the Court finds that the State has presented sufficient
arguments and evidence that Defendants’ disparate impact regulations and extra-regulatory
Page 75 of 77
requirements do create substantial increases costs, which the State would not be able to
recover from the federal governments. 89 Additionally, the State is entitled to unambiguous
clarity concerning Defendants’ power to regulate beyond the plain text of Title VI. This is
its sovereign right. The State must be able to issue permits and accept and maintain grants
with advance knowledge and understanding of the scope of its compliance with Title VI.
It is abundantly clear, that Defendants’ actions iterated herein have created great cause for
concern, not only for the State of Louisiana, but also for our sister states who have also
found themselves at the whim of the EPA and its overreaching mandates. The State has
met its burden as to irreparable harm.
C. Balance of equities and public interest factors
“[T]here is generally no public interest in the perpetuation of unlawful agency
action.” Wages & White Lion Invs., L.L.C. v. FDA, 16 F. 4th 1130, 1143 (5th Cir. 2021).
“[C]omplying with a regulation later held invalid almost always produces the irreparable
harm of non recoverable compliance costs.” Louisiana v. Biden, 55 F.4th 1017, 1034 (5th
Cir. 2022) (cleaned up). The public interest here is that governmental agencies abide by its
laws, and treat all of its citizens equally, without considering race. To be sure, if a decision
maker has to consider race, to decide, it has indeed participated in racism. Pollution does
not discriminate. Surely, that is why Title VI so plainly does not mention disparate impact.
The Court finds that the States has met its heavy burden that warrants a preliminary
89
See the discussions herein as to the State’s costs of compliance, and as to the increased funding for the EPA to
enforce its disparate impact mandate regime.
Page 76 of 77
injunction against the EPA and DOJ as to its disparate impact mandates and extra-
regulatory requirements (cumulative impact).
CONCLUSION
For the reasons set forth herein, the Court finds that the State has standing to
challenge the EPA’s disparate impact mandates and extra-regulatory requirements
(cumulative impact) and the DOJ’s 1966 disparate impact regulation. The Court further
finds and that a preliminary injunction should issue against the EPA and DOJ to enjoin
these federal governmental agencies from imposing or enforcing any disparate impact
based requirements against the State or any State agency under Title VI, and imposing or
enforcing any Title VI based requirements upon the State or any State agency that are not
both (a) ratified by the President, as required by 42 U.S.C. § 2000d-1, and (b) based upon
requirements found within the four corners or EPA’s disparate impact regulations, 40
C.F.R. § 7.35(b),(c). The Court will dismiss the State’s challenge to the EPA’s alleged non-
delegation violations, as the State does not have standing to assert this challenge. The Court
will grant Louisiana’s Request for Judicial Notice.
THUS DONE AND SIGNED in Chambers on this 23rd day of January, 2024.
___________________________________________
JAMES D. CAIN, JR.
UNITED STATES DISTRICT JUDGE
Page 77 of 77

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Case 2:23-cv-00692-JDC-TPL Document 48 Filed 01/23/24 Page 1 of 77 PageID #: 2997

UNITED STATES DISTRICT COURT

STATE OF LOUISIANA CASE NO. 2:23-CV-00692

VERSUS JUDGE JAMES D. CAIN, JR.

U S ENVIRONMENTAL PROTECTION MAGISTRATE JUDGE LEBLANC

VI”) and the Administrative Procedures Act (“APA”).

requirements found within the four corners of EPA’s disparate-impact regulations, 40

C.F.R. § 7.35(b), (c).

Also, before the Court is “Defendants’ Cross-Motion to Dismiss or, in the

October 3, 2023, acceptance for investigation of a Title VI complaint alleging only

disparate impact by facially non-discriminatory policies.

The Court heard arguments as to these motions on January 9, 2024.

disparate-impact-based requirements that effectively require racial discrimination. The

impact-based mandates under Title VI because Title VI has no such disparate-impact

Section 601 of Title VI provides:

42 U.S.C. § 2000d. Of note, agencies’ rulemaking power is limited to actions that

such as the EPA, to implement § 601 on intentional racial discrimination in federally-

to enforce its regulations by “terminating or refusing to grant or to continue financial

C.F.R. §§ 41.101-12. DOJ’s published regulations purport to impose disparate-impact-

enforce the Department’s implementing regulation prohibiting unintentional

discriminatory effect or disparate impact because the statutory provisions of Title VI

regulations in 2020, 3 but inexplicably never published its decision to do so.

impact regime established by 42 U.S.C. § 2000e–2(k). 4 EPA adopted that interpretation

VI disparate impact regulations into question.” 68 Fed. Reg. at 51,338.

“criteria or methods of administration which have the effect of subjecting individuals to

See Nondiscrimination in Federally Assisted Programs—Implementation of Title VI of the

Title VI regulations with presidential approval. See Nondiscrimination Programs

17,968 (July 5, 1973) (AR286-90).

Both agencies’ regulations prohibited recipients of federal financial assistance from

administering programs in a manner that has the effect of subjecting individuals to

discrimination based on race, color, or national origin. See Nondiscrimination in Federally

Assisted Programs—Implementation of Title VI of the Civil Rights Act of 1964, 31 Fed.

Register. See AR279-80.

assistance through annual funding grants to the Louisiana Department of Environmental

Quality (LDEQ) and the Louisiana Department of Health (LDH). Declaration of

16 grant applications are pending. Id. ¶ 5.

As the discriminatory-effect provisions of EPA’s Title VI regulations have

the discriminatory-effect provisions of EPA’s Title VI regulations. Id. ¶¶ 8-11.

Anhthu Hoang (“Hoang Decl.”) ¶¶ 6-7.

On February 1, 2022, EPA’s OECRC received the complaint docketed as EPA

On April 6, 2022, EPA’s OECRC initiated: (1) an investigation of Complaint Nos.

enforcement or otherwise, in response to these Complaints.”

otherwise, in response to this Complaint.”

consideration by EPA. Hoang Decl. ¶ 22.

LDEQ undertake analysis under “civil rights regulations” to avoid “unjustified

disproportionately impacted either by public health or environmental burdens.” Id.

C.F.R. § 7.130 (“Actions available to EPA to obtain compliance”) to terminate assistance,

disparate-impact regulations; Defendants remark that such compliance costs would be

funded by the grant itself. See 2 C.F.R. § 200.403(a).

discrimination. See generally exhibit 11.

negotiation.” See Seidemann Decl. ¶¶ 65-70.

product of intentional discrimination. See Seidemann Decl. ¶109.

LAW AND ANALYSIS

action do not require final agency action.

Defendants’ disparate-impact regulations under the Administrative Procedure Act’s

2022, and again past March 2023. 6

As to disparate-impact regulations, the State maintains that Defendants have taken

to condition those grants on compliance with Defendants’ unlawful disparate-impact

injunctive relief as to Extra-Regulatory Requirement (Count VI) to Defendant’s attempts