Though not an intellectual property matter, California’s recent battles with automakers and the U.S. Environmental Protection Agency (EPA) are worth a post because of the potential impact on clean vehicle technology. 

The federal Clean Air Act preempts state regulation of motor vehicle emissions but provides that California may apply to the EPA for a waiver to impose rules more stringent than the federal regulations.  Other states cannot apply for a waiver, but they may adopt any California standards enacted pursuant to its waiver.  In 2002 California passed Assembly Bill 1493, which required the California Air Resources Control Board (CARB) to enact regulations to achieve maximum reduction of greenhouse gas emissions from motor vehicles.  In 2004, CARB completed the regulations, which provide strict emissions standards for passenger cars and light duty trucks starting with the 2009 model year. 

Central Valley Chrysler-Jeep and the Association of International Automobile Manufacturers sued to block the regulations from taking effect.  The automakers’ main argument was based on the doctrine of preemption, which holds that a federal law trumps a conflicting or inconsistent state law.  Specifically, the automakers contended that even if California were granted a waiver by the EPA, its emissions standards would still be state regulations subject to preemption.  The court disagreed and held, consistent with the outcome of a similar case in Vermont, that state regulations enacted in accordance with the Clean Air Act’s waiver scheme become “federalized” and are therefore not subject to federal preemption.  Thus, California’s vehicle emissions standards were legally viable; the state just needed the green light from the EPA.

Unfortunately, the EPA denied California’s request for a waiver to enact its emissions regulations.  (read the story here)  The agency’s rationale is that greenhouse gases are not a local or regional air quality issue, but are “global in nature” so separate state standards are not needed.  The EPA pointed to the energy bill just signed by President Bush as part of a national solution to emissions problems.  It seems California has lost the latest battle over its emissions standards, but future litigation seems likely – the chair of the California Air Resources Board plans to “sue and sue again” until the EPA lets the state go forward.

• Previous Entry: From the Frying Pan to the Gas Tank
• Next Entry: Morphic’s Recent Acquisitions