IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA

     Plaintiffs hereby move the Court to enjoin Defendant EPA, during the pendency of this litigation, from requiring the submission of "Form R" data on releases of dioxins and dioxin-like compounds for the Toxics Release Inventory ("TRI"). The Form Rs setting forth these releases for calendar year 2000 must be filed by July 1, 2001. For this reason, and for the reasons set forth below and in the accompanying affidavit, immediate injunctive relief is needed to preserve the rights of the Plaintiffs pendente lite and to avoid the irreparable harm that would result from the disputed TRI filing. Counsel for Defendants has indicated that Defendants will oppose this motion.

     Counsel for Plaintiffs has spoken with the Court’s clerk regarding scheduling a hearing on this motion and has indicated that, in light of the July 1, 2001 reporting deadline, a hearing on or before June 29 is of utmost importance. Counsel for Defendants has consented to the scheduling of a hearing on June 29, 2001.

FACTUAL AND PROCEDURAL BACKGROUND

     Section 313 of the Emergency Planning and Community Right to Know Act ("EPCRA"), 42 U.S.C. § 11023, requires certain facilities manufacturing, processing, or otherwise using a listed toxic chemical in amounts above specified threshold levels, to report facility-specific information about such chemicals, including the annual quantity entering each environmental medium. On October 29, 1999, EPA issued a new final rule under EPCRA section 313, "Persistent Bioaccumulative Toxic (PBT) Chemicals; Lowering of Reporting Thresholds for Certain PBT Chemicals; Addition of Certain PBT Chemicals; Community Right-to-Know Toxic Chemical Reporting." 64 Fed. Reg. 58666 (Oct. 29, 1999) ("final rule"). The final rule established an extraordinarily low new reporting requirement for releases of seven polychlorinated dibenzo-p-dioxins and ten polychlorinated dibenzofurans (collectively, "dioxins and dioxin-like compounds").

     The final rule set a reporting threshold of 0.1 grams for total combined releases of all dioxins and dioxin-like compounds in a single calendar year. 64 Fed. Reg. at 58672. However, the final rule did not specify the contents of the reporting requirement, i.e., what releases the affected respondents are required to report. Likewise, the final rule did not provide a methodology explaining how the volume of such reportable releases would be calculated. This information was also omitted from the information collection request that EPA submitted to OMB for approval pursuant to the Paperwork Reduction Act of 1995, 44 U.S.C. §§ 3501, et seq. ("PRA").

     EPA stated in the final rule that the agency would be "providing additional guidance on the level of precision at which facilities should report their releases". 64 Fed. Reg. at 58672. On June 15, 2000, EPA issued a Federal Register notice making available for comment a draft agency document titled "Emergency Planning and Community Right-to-Know Act -- Section 313: Guidance for Reporting for the Dioxin and Dioxin-like Compounds Category" (hereinafter, the "Guidance"). EPA sought comments on the technical contents of the Guidance, "particularly on the methods of estimating releases and other waste management quantities for dioxin and dioxin-like compounds." 65 Fed. Reg. 37548, 37549 (June 15, 2000). Undersigned counsel for Plaintiffs submitted comments to EPA on the draft Guidance and filed a copy of these comments with the Court on July 17, 2000.

     Plaintiff Wood Protection Products, Inc. ("WPP") may have had releases of dioxin and dioxin-like compounds during 2000 in excess of the 0.1 gram threshold, and WPP therefore falls within the scope of the final rule’s reporting requirements. 64 Fed. Reg. at 58666. Affidavit of WPP Vice President, James R. Forshaw (attached as Exhibit 1) at 5. WPP must therefore submit a report known as a Form R, the Toxic Release Inventory Reporting Form, detailing these releases by July 1, 2001. See 40 C.F.R. § 372.30.¹

     Plaintiffs filed this action challenging a portion of the final rule on February 1, 2000. The original complaint sought an injunction against OMB’s approval of EPA’s information collection request ("ICR") under the Paperwork Reduction Act. Plaintiffs withdrew that claim for injunctive relief on February 4, 2000, however, following OMB’s approval of the ICR and sought only declaratory relief in their first amended complaint, which was filed March 21, 2000. On June 12, 2001, Plaintiffs moved for leave to amend their complaint a second time to add a claim for injunctive relief. Plaintiffs’ second amended complaint seeks declaratory and injunctive relief based on two causes of action: (i) Defendants’ violation of the Paperwork Reduction Act; and (ii) EPA’s arbitrary and capricious failure to satisfy the statutory requirements for establishing a chemical reporting threshold under EPCRA section 313.

     On April 14, 2000, Defendants moved to dismiss the first cause of action relating to the Paperwork Reduction Act, and briefing on that motion was completed June 30, 2000. By agreement of the parties and by Order of the Court dated June 22, 2000, briefing on cross-motions for summary judgment, including briefing on the statutory (EPCRA) cause of action, was deferred until after the Court ruled on Defendants’ motion to dismiss the Paperwork Reduction Act claim.

ARGUMENT

I. The Applicable Legal Standard Supports Issuance of a Preliminary Injunction Here.

     The frequently recited standard for issuance of a preliminary injunction states that the moving party must establish: (1) a substantial likelihood of success on the merits; (2) irreparable harm if a preliminary injunction is not granted; (3) that the harm to them if a preliminary injunction is not granted outweighs any harm to nonmovants if the preliminary injunction is granted; and (4) that granting of a preliminary injunction would further the public interest. Mova Pharmaceutical Corp. v. Shalala, 140 F.3d 1060, 1066 (D.C. Cir. 1998) (citing CityFed Fin. Corp. v. Office of Thrift Supervision, 58 F.3d 738, 746 (D.C. Cir.1995)); Washington Metropolitan Area Transit Comm’n v. Holiday Tours, Inc., 559 F.2d 841, 483 (D.C. Cir. 1977); World Duty Free Americas, Inc. v. Summers, 94 F. Supp. 2d 61 (D.D.C. 2000) (Lamberth, J.) (enjoining agency from enforcing rules).

     Although Plaintiffs must satisfy all four requisites to some degree, they do not need to make an equally strong showing on each. Courts are to weigh all the elements together, and the D.C. Circuit has recognized that the factors "interrelate on a sliding scale and must be balanced against each other." Davenport v. International Bhd of Teamsters, 166 F.3d 356, 361 (D.C. Cir. 1999) (citing Serono Labs. Inc. v. Shalala,158 F.3d 1313, 1317-18 (D.C. Cir. 1998)). Thus, a strong showing on one factor, such as likelihood of success on the merits, may justify issuance of a preliminary injunction even if the showing on one or more other factors, such as irreparable injury, is relatively weak. CityFed Fin. Corp., supra, 58 F.3d at 747; see also Cuomo v. Nuclear Regulatory Comm’n, 772 F.2d 972, 974 (D.C. Cir. 1985) (per curiam); Bracco Diagnostics, Inc. v. Shalala, 963 F. Supp.20, 27 (D.D.C. 1997); Bristol-Myers Squibb Co. v. Shalala, 923 F. Supp. 212, 215-16 (D.D.C. 1996); Smith v. Shalala, 954 F. Supp. 1, 3 (D.D.C. 1996).

     A clear showing of irreparable harm is not required. Indeed, earlier this year the court in Mylan Pharms., Inc. v. Thompson, 139 F. Supp. 2d 1, 2001 WL 273073 (D.D.C. 2001) (Urbina, J.), issued a mandatory preliminary injunction against a federal agency after expressly holding that the movant had failed to demonstrate irreparable harm. The court held that, because the movant had made such a strong showing on the merits, which involved primarily questions of law, and because the other two factors also weighed in favor of the movant, the preliminary injunction was warranted. Id., 2001 WL 273073 at *24.

     In this case, Plaintiffs have made a very strong showing on the merits, which is the "most important" of the four prongs. See Mylan Pharms., supra, 2001 WL 273073 at *13. Like the interpretation of the Hatch-Waxman Act and the construction of the patent claims at issue in Mylan Pharms., the violations of the Paperwork Reduction Act at issue in this case are purely a matter of law for the Court to decide. The balancing of possible harms and the public interest also strongly favor a preliminary injunction. The threat of irreparable harm, supported by the attached affidavit, is more than sufficient to justify the requested relief. Accordingly, a preliminary injunction should be granted.

II. Plaintiffs Are Likely to Prevail on the Merits of Their Paperwork Reduction Act Claim.²

     Plaintiffs’ May 25, 2000 memorandum in opposition to Defendants’ motion to dismiss the first cause of action ("Pl. Opp.") sets forth in detail Defendants’ clear violation of the Paperwork Reduction Act, and Plaintiffs respectfully refer the Court to that brief.

     To summarize, EPA failed to submit a valid information collection request as required under the PRA. Instead, EPA withheld from OMB, and from the public, crucial aspects of its proposed information collection, including how the agency intended to define reportable "releases" of dioxin and dioxin-like compounds and the methodology by which such releases were to be calculated. Because this vital explanation was omitted, Plaintiffs and the public were denied their statutory rights to comment on the burden the proposed information collection would impose on respondents, on EPA’s need for the new information, and on the "practical utility" of the information EPA sought to collect.

     The PRA violations Defendants committed in issuing the final rule were no mere technicalities. It is important to stress that releases of the "dioxin and dioxin-like compounds" at issue occur in, and are expressed in terms of, extremely minute volumes -- literally in billionths or trillionths of grams -- and that procedures for estimating these releases are not at all obvious. While the TRI program does not require that new monitoring or measurements beyond that required under other laws be performed, 42 U.S.C. § 11023(g), Plaintiffs have never been required to monitor releases of dioxin and dioxin-like compounds in the past. They therefore have no actual facility-specific release data to use for reporting. Preparing suitable models to accurately estimate these releases, in lieu of such actual data, is very expensive. Details on how the releases were to be calculated and on what volume of releases would trigger a reporting requirement were therefore absolutely essential to understanding the burden EPA proposed to place on the affected TRI respondents, including Plaintiffs.

     And yet EPA provided no timely explanation whatsoever of how it intended to define a reportable release or of how releases were to be calculated. Only after the period for commenting on the ICR had elapsed, and after OMB had approved the ICR, did EPA belatedly issue a "guidance", ostensibly clarifying the information it intended to collect. The contents of this belated guidance, attached as Exhibit 2, reflect at least some of the detail that should have been revealed to the Plaintiffs and the public prior to -- not after -- submission of the ICR to OMB and OMB’s approval of the ICR. Plaintiffs and the other respondents affected by the new reporting requirement had no opportunity, prior to OMB’s approval of the ICR, to apprise EPA or OMB of how burdensome the proposed reporting would actually be. Lacking this information, EPA and OMB could not have satisfied their respective statutory duties to certify and to evaluate the ICR in terms of need, practical utility and burden. See Pl. Opp. at 11-15. The procedure the agencies followed effectively resulted in an end run around the PRA and the safeguards that Congress placed in that statute to prevent unnecessary and burdensome government information demands on the public.

     Defendants have not denied any of the above allegations, and indeed they cannot -- the facts are not in dispute. EPA does not deny that the final rule and the ICR failed to provide a definition of what "releases" of dioxin and dioxin-like compounds would trigger the TRI reporting requirement. Likewise, EPA cannot point to any provision in the final rule or the ICR where the methodology for calculating dioxin releases is set forth.³ In moving to dismiss the PRA claim, Defendants assert merely that their Paperwork Reduction Act violations are beyond the jurisdiction of this Court to remedy. Plaintiffs have fully addressed Defendants’ arguments in this regard, and these legal issues should be decided in favor of Plaintiffs. See Pl. Opp.⁴

     The first "Form Rs" for dioxin and dioxin-like compounds are due by July 1, 2001.⁵ The published TRI document itself, which is widely disseminated in hard copy and is posted on EPA’s Internet website, is a prominent source of information on toxic releases. See TRI Executive Summary from www.epa.gov (attached as Exhibit 3). Thus, in addition to being permanently denied their procedural rights under the PRA, Plaintiffs face the imminent prospect of being publicly and unfairly smeared with the stigma of "dioxin polluter." As detailed in the attached affidavit, once the Form Rs are filed and the data are made publicly available, the damage to Plaintiffs’ reputation will be irreparable.

     The irreparable harms threatening Plaintiffs are attributable both to Defendants’ violation of the PRA and to substantive deficiencies in the new reporting requirement itself. Had Plaintiffs and the public been afforded an opportunity to comment on the new collection of information in the ICR as Congress intended, and had the other PRA procedures been followed, some of the substantive deficiencies could have been corrected through the regular administrative process.

     For example, Congress recognized that information that confuses and misleads is of little value to the public. The PRA therefore requires that an agency proposing to collect information solicit public comment to evaluate whether the proposed collection will have "practical utility." 5 C.F.R. § 1320.8(d)(1)(i); see also 44 U.S.C. § 3504(c)(4).⁶ Had Defendants complied with this and the other requirements of the PRA, certainly the scope of data to be submitted under the final rule could have been narrowed. The reporting EPA ultimately required also could have been expressed in clearer terms as a result of such comments. It is even possible that the reporting threshold for releases of dioxin or dioxin-like compounds might have been established at a level above the level of Plaintiffs’ estimated releases, thus eliminating the need for Plaintiffs to report altogether. Defendants’ procedural violations and ill-defined reporting requirements, however, now threaten Plaintiffs with an unfair and generalized public stigma. An injunction is warranted to prevent this harm. GTE Sylvania, Inc. v. Consumer Product Safety Comm’n, 404 F. Supp. 352, 373 (D. Del. 1975) (enjoining agency release of safety information due to agency’s failure to comply with procedures designed to ensure accuracy of information).

     Because the purpose of injunctive relief is to prevent future harm, the assessment of such harm is inherently somewhat speculative and non-quantifiable. Serono Laboratories, Inc. v. Shalala, 974 F. Supp. 29, 32, 35-37 (D.D.C. 1997), rev’d on other grounds, 158 F.3d 1313 (D.C. Cir. 1998); Barnstead Broadcasting Corp. v. Offshore Broadcasting Corp., 865 F. Supp. 2, 7-8 (D.D.C. 1994) (enjoining competitor from filing administrative objections where such action threatened plaintiff with loss of business opportunities). Courts will grant an injunction in appropriate cases, however, despite the uncertain an non-quantifiable nature of threatened harm. See, e.g., Reuters, Ltd. v. United Press Int’l, 903 F.2d 904, 907-09 (2d Cir. 1990) (granting preliminary injunction where threatened loss of photo supply services was nearly impossible to value and was recognized as a speculative loss); Gerard v. Almouli, 746 F.2d 936, 939 (2d Cir. 1984) (granting preliminary injunction because damages from violation of exclusive distributorship agreement would be impossible to quantify, especially since there was not yet any developed market for the product); MGM-Pathe Communications Co. v. Pink Panther Patrol, 774 F. Supp. 869, 873 (S.D.N.Y. 1991) (granting preliminary injunction where harm to plaintiff’s image would be "difficult to measure and compensate"). Thus, potential damage to business reputation has been found to justify injunctive relief even where no likelihood of specific monetary loss had been shown. See, e.g., Patriot v. HUD, 963 F. Supp. 1, 5 (D.D.C. 1997) (plaintiffs’ reputation would be damaged by agency letter characterizing them as engaging in unethical mortgage marketing practices) (citing Honeywell, Inc. v. Consumer Product Safety Comm’n, 582 F. Supp. 1072, 1078 (D.D.C. 1984)).

     Federal courts recognize damage to business reputation in the form of disparagement of product safety as irreparable harm sufficient to justify a preliminary injunction. See, e.g., Honeywell, supra, 582 F. Supp. at 1078 (enjoining threatened disclosure to the public of documents pertaining to the safety of gas controls). Courts have specifically held that this type of potential harm was sufficient to support injunctive relief in cases challenging agency actions that identify as hazardous certain chemicals associated with plaintiffs’ products. See, e.g., Dow Chemical, USA v. Consumer Product Safety Comm’n, 459 F. Supp. 378, 394-95 (W.D. La. 1978) (preliminary injunction granted to stay classification of product as Class A carcinogen); Synthetic Organic Chem. Mfrs. Ass’n v. Secretary, Dept. of Health and Human Servs., 720 F. Supp. 1244, 1257 (stating court would "willingly act" to enjoin proposed listing of substance in agency report if plaintiffs could show a likelihood of prevailing on the merits).

     Here, the new reporting under the final rule will create public confusion and concern over the safety of Plaintiffs’ products and businesses, thereby reducing Plaintiffs’ sales. Forshaw Aff. at 8-14. The public is likely to be confused over the meaning of the new TRI reporting because of EPA’s failure to adopt a TEQ or "toxic equivalents" methodology. Under the final rule, the release of a given volume of one of the 17 chemicals in the "dioxin or dioxin-like compounds" category is considered identical to a release of the same volume of any of the other chemicals, even though the relative toxicities of the compounds may differ by 10,000 fold. Forshaw Aff. at 10. The public will therefore be misinformed as to the potential risk caused by these releases. The new reporting will also mislead the public regarding major sources of dioxin releases. Id. at 8. The public invariably will incorrectly view all "dioxin polluters" in the same unfavorable light, and, in addition to lost sales, Plaintiffs will incur increased costs associated with attempting to dispel this public confusion and concern. Id. at 10.

     Dioxin has been the subject of extensive media coverage in recent months, prompted in part by the anticipated completion of EPA’s own decade-long dioxin reassessment. Recent press articles describing the EPA dioxin reassessment note that the agency has concluded that 2,3,7,8-TCDD, the most toxic of the 17 distinct chemicals that are grouped into EPA’s single reporting category under the final rule, can cause cancer in humans. See Exhs. 4, 5, 6. The articles also note EPA’s conclusion that "dioxin" can cause serious non-cancer effects including attention disorders, learning disabilities, and susceptibility to infections and liver ailments. Id. The public, including Plaintiffs’ customers, are clearly sensitized to the dioxin issue, see Forshaw Aff. at 13, and would likely view any new reporting of dioxin releases as a violation of some federal standard.

     Plaintiffs’ claims of threatened injury thus are not mere speculation; dioxin-related concerns have driven away Plaintiffs’ customers before. As the attached affidavit details, a number of major purchasers of pentachlorophenol, for example, have switched to substitute products out of concern over the association between penta and dioxin. Forshaw Aff. at 9, 13. In Wisconsin Gas Co. v. FERC, 758 F.2d 669 (D.C. Cir. 1985), the D.C. Circuit explained that an injunction is appropriate, inter alia, where "[t]he movant provide[s] proof that the harm has occurred in the past and is likely to occur again". 758 F.2d at 674. Here, such proof of past harm is clearly present.

     The essence of threatened "irreparable" harm is that such harm is not susceptible of repair through later judicial relief in an action for monetary damages. Serono Labs., Inc. v. Shalala, supra, 974 F. Supp. at 35-36 (enjoining agency’s approval of plaintiff’s competitor’s product where plaintiff’s loss of market share, though speculative, could not later be compensated), rev’d on other grounds, 158 F.3d 1313 (D.C. Cir. 1998); Bracco Diagnostics v. Shalala, 963 F. Supp. 20, 29 (D.D.C. 1997) (enjoining FDA’s disparate treatment of two similar products); see also Ross-Simons of Warwick, Inc. v. Baccarat, Inc., 102 F.3d 12, 18-19 (1^st Cir. 1996) ("It is usually enough if the plaintiff shows that its legal remedies are inadequate.").

     Plaintiffs here could not later seek compensation in a suit for monetary damages against EPA, a U.S. government agency. Thus, even if the damages described above were calculable, "[P]laintiff[s] will suffer loss of sales and good will for which [they] would have no right of recourse, and thus [their] injury will be irreparable." Hoffman-Laroche, Inc. v. Califano, 453 F. Supp. 900, 903 (D.D.C. 1978) (issuing preliminary injunction against agency’s adoption of cost ceilings); see also Wisconsin Gas Co., supra, 758 F.2d at 674 (implying that economic harm may be irreparable if monetary loss is not recoverable).

     Finally, in addition to the tangible harms Plaintiffs face from being stigmatized as a "dioxin polluter", Plaintiffs will also be deprived of their statutory procedural right to comment under the Paperwork Reduction Act. Allowing the challenged new reporting requirement to go into effect would permit EPA to complete its end run around the requirements of the PRA and would deprive Plaintiffs of their procedural rights. The denial of this right, like the denial of a right to participate under the APA, would constitute separate irreparable harm, independently supportive of the injunction. See Community Nutrition Inst. v. Butz, 420 F. Supp. 751, 757 (D.D.C. 1976) ("the harm suffered by those who would otherwise participate in an agency rulemaking . . . is irreparable when the agency fails to afford them their rights to such participation").

     As described above, the Plaintiffs face severe harm if the new reporting of dioxin and dioxin-like compound releases is permitted to go forward July 1, 2001. There is no countervailing harm to EPA, however, from granting the injunction Plaintiffs seek. If the Court concludes that the final rule was not validly established in full compliance with the Paperwork Reduction Act, then enjoining the reporting would not deprive the United States of any revenue or benefit to which it is rightfully entitled. See World Duty Free Americas, Inc. v. Summers, 94 F. Supp. 2d 61, 67 (D.D.C. 2000) (Lamberth, J.) (holding that balance of harm to other interested parties favored enjoining agency from enforcing rules). Similarly, any "harm" to EPA from an order enjoining an invalid collection of information until the agency complies with the procedures under the Paperwork Reduction Act is "harm" intended by Congress in enacting that statute.

     In the unlikely event that subsequent briefing on the Paperwork Reduction Act claim reveals that Defendants are correct in their jurisdictional arguments, then the final rule could be reinstated in time for reporting of calendar year 2001 releases. The only harm EPA would have incurred would be a 12-month delay in implementation of the new rule.

     The public interest also would be furthered by an injunction preventing EPA from completing its end run around the PRA. As described in the attached affidavit and Plaintiffs’ opposition to Defendants’ the motion to dismiss the PRA claim, the Plaintiffs clearly were denied their statutory procedural right to comment in any meaningful sense under the PRA. The public’s confidence in federal agency adherence to law would be ill served if the Court, by allowing the challenged TRI reporting to go forward while this case is pending, were to reward EPA’s blatant disregard of congressional intent, as reflected in that statute.

     In addition, courts have held that an agency’s failure to follow required procedures justifies injunctive relief where the agency action could result in an irretrievable commitment of public resources, even where plaintiffs have not demonstrated a likelihood of serious economic harm to their businesses. See, e.g., Mt. Airy Ref. Co. v. Schlesinger, 481 F. Supp. 257, 284 (D.D.C. 1979) (failure to comply with environmental assessment requirements of National Environmental Policy Act). In this case, the new TRI reporting and the resulting public confusion are likely to result in pressure on EPA to restrict production of the Plaintiffs’ products when, in fact, dramatically higher dioxin releases are attributable to other sources. See Forshaw Aff. at 8. The rule is therefore likely to waste scarce enforcement and other agency resources.

     Finally, of course, the public interest is ill served by the non-TEQ reporting mandated under the final rule, which will only confuse and mislead users of the TRI data.

CONCLUSION

For the foregoing reasons, Plaintiffs’ motion for preliminary injunction should be granted. A proposed Order is attached.

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