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 In that June case, the court said that the healthcare law was an
issue of such importance that the court would not stick to its usual
practice of deferring to a government agency's legal expertise when
interpreting ambiguously written laws.
That same argument will now be turned against the government to
challenge a crucial plank of Obama's strategy to cut U.S. emissions
and fight global warming, several lawyers likely to be involved in
the litigation told Reuters.
Obama's Clean Power Plan to cut emissions from coal-fired power
plants is expected to be finalized as early as next week, ahead of a
crucial United Nations climate change conference in Paris at the end
of the year. The rule requires each U.S. state to cut its greenhouse
gas emissions to achieve a nationwide reduction of 30 percent by a
target date of 2030.
With less than 18 months left in Obama's presidency, a legal loss
would blow a hole in his hopes of leaving a significant legacy on
tackling climate change.
Opponents, mainly Republican-leaning states and the coal industry,
say the rule will cost hundreds of billions of dollars and lead to a
spike in electricity prices. They view it as part of an Obama "war
on coal," which disproportionately affects coal-producing states
like West Virginia.
At the core of their legal challenge will be the argument that the
Environmental Protection Agency (EPA) does not have such broad
authority to influence the economically crucial area of energy
policy.
The challengers will argue that the government agency has exceeded
its legal authority, in part by allowing states to meet their
targets not only through limiting power plant emissions but via
additional measures such as promoting renewable energy.
In its June 25 ruling in the healthcare case, called King v.
Burwell, the court rejected a conservative challenge to the 2010
Affordable Care Act on a 6-3 vote.
Even though the government won, Chief Justice John Roberts included
language in his majority opinion that could help challengers to
government regulations. He stressed that when a case is of "deep
economic and political significance" the court will depart from its
usual practice of giving considerable weight to an agency's
interpretation.
"LITIGATED TO DEATH"
Courts ruling on the Clean Power Plan should adopt the same approach
as Roberts did in the healthcare case and decline to defer to the
agency, the lawyers are expected to say. If courts endorse the
argument that the EPA does not merit deference, the government would
lose one of its best legal defenses.
"That's an issue that will be litigated to death" by lawyers on both
sides, said Theodore Hadzi-Antich, a lawyer with the Pacific Legal
Foundation, a conservative legal group likely to support the legal
challenge.
The Clean Air Act, the law that gives EPA authority to issue air
pollution regulations, was originally enacted in 1970 when lawmakers
did not envision it would be used to tackle greenhouse gas
emissions.
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Vocal opponents of the new regulation, including states like West
Virginia and Texas and coal companies, including Murray Energy Corp
[MUYEY.UL], have indicated they will file suit as soon as it is
officially announced.
Lawyers, some set to represent states and industry groups
challenging the rule and others with environmental groups likely to
support the government, differ over how much influence the Obamacare
case will have.
King v. Burwell doesn't by itself doom the rule, but one industry
lawyer set to be involved said it constitutes "the next logical
step" following recent rulings in which the high court has cast a
skeptical eye on major regulatory actions.
The challengers are also likely to question whether the EPA is even
due the usual deference that it gets as the "expert agency"
considering the broad implications of the regulation.
Industry lawyers say the EPA is moving beyond its role as an
environmental regulator and is instead seeking to direct energy
production and distribution. In the healthcare case, the court found
that the Internal Revenue Service, which had issued regulations
implementing Obamacare insurance subsidies, did not deserve
deference because it is not the "expert agency" when it comes to
health insurance policy.
Lawyers representing environmental groups expected to help defend
the EPA downplay the Obamacare case's significance.
They say that, unlike the IRS's role in the Obamacare case, Congress
clearly intended the EPA to have considerable leeway in implementing
the Clean Air Act.
An EPA spokeswoman said the agency is confident it has the legal
authority to issue the rule, based in part on other recent Supreme
Court rulings.
In those cases, including one that came out just days after King v.
Burwell, the court has continued to use the same legal methodology
in which the court defers to agency expertise. The court first
adopted that approach in an environmental case decided in 1984.
As such, the Obamacare case is "very unlikely to significantly
influence the outcome of the Clean Power Plan one way or the other,"
said Sean Donahue, a lawyer who represents environmental groups.
(This version of the story corrects the agency name to Internal
Revenue Service, not Inland Revenue Service, in paragraph 18.)
(Reporting by Lawrence Hurley. Additional reporting by Valerie
Volcovici. Editing by Stuart Grudgings.)
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