Minnesota Auto Dealers Association v. State of Minnesota et al
ORDER GRANTING DEFENDANTS' MOTION TO DISMISS. (Written Opinion) Signed by Judge Wilhelmina M. Wright on 2/17/2021. (RJE)
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UNITED STATES DISTRICT COURT
DISTRICT OF MINNESOTA
Minnesota Auto Dealers Association,
Case No. 21-cv-0053 (WMW/ECW)
ORDER GRANTING DEFENDANTS’
MOTION TO DISMISS
State of Minnesota, by and through the
Minnesota Pollution Control Agency, and
Laura Bishop, as Commissioner of the
Minnesota Pollution Control Agency,
This matter is before the Court on Plaintiff’s expedited motion for a preliminary
injunction and Defendants’ motion to dismiss Plaintiff’s complaint. (Dkts. 13, 28.)
Three third-party organizations also seek to intervene as Defendants in this case. For the
reasons addressed below, Defendants’ motion to dismiss is granted and this matter is
dismissed without prejudice for lack of subject-matter jurisdiction.
Plaintiff’s expedited motion for a preliminary injunction and the pending motion to
intervene are denied as moot.
Plaintiff Minnesota Auto Dealers Association (MADA) is a Minnesota corporation
that advocates for the interests of retail motor vehicle dealerships in Minnesota.
Defendant State of Minnesota, by and through the Minnesota Pollution Control Agency
(MPCA), is a state governmental agency authorized to regulate air quality in Minnesota.
Defendant Laura Bishop is the Commissioner of the MPCA.
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MADA commenced this action seeking to enjoin Defendants from engaging in
administrative rulemaking pertaining to motor vehicle greenhouse gas emissions
standards in Minnesota. Defendants’ rulemaking conduct, MADA alleges, is preempted
by two federal laws: the Clean Air Act, 42 U.S.C. §§ 7521–54, 7581–90, and the Energy
Policy and Conservation Act (EPCA), 49 U.S.C. § 32902. It is undisputed that the Clean
Air Act prohibits any state from adopting new motor vehicle emission standards that
differ from those established under the Clean Air Act.
See 42 U.S.C. § 7543(a).
However, the Environmental Protection Agency (EPA) may waive the express
preemption of state regulations for California and, thereafter, other states may adopt
regulations that are identical to California’s standards.
See 42 U.S.C. §§ 7507,
In addition, the EPCA governs federal fuel economy standards for
automobiles and preempts state laws or regulations pertaining to such standards. See 49
U.S.C. §§ 32902, 32919.
On September 27, 2019, the EPA revoked California’s then-existing Clean Air Act
preemption waiver, thereby invalidating California’s motor vehicle emission standards.
See 84 Fed. Reg. 51,310 (Sept. 27, 2019). In addition, the EPA and the Department of
Transportation’s National Highway Traffic Safety Administration (NHTSA) concluded
that the EPCA, which governs fuel economy standards, also preempts motor vehicle
emissions standards. Id. Several states, including Minnesota, have challenged these
administrative actions in litigation that currently is pending before the United States
Court of Appeals for the District of Columbia Circuit. See Competitive Enter. Inst. v.
NHTSA, No. 20-1145 (D.C. Cir.); Union of Concerned Scientists v. NHTSA, No. 19-1230
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In addition, the current presidential administration is considering
suspending, revising, or rescinding the administrative actions of the prior presidential
administration that pertain to fuel economy and motor vehicle emissions standards. See
Exec. Order No. 13,990, 86 Fed. Reg. 7037 (Jan. 20, 2021).
In or about October 2019, Defendants published a request for comments on
proposed rules governing motor vehicle emissions standards in Minnesota based on
California’s emissions standards. Defendants’ request for comments acknowledges that
“[a]ny final rule in Minnesota would need to be made contingent on restoration of the
state’s ability to adopt these measures, including the existence of operative waiver
authority under . . . the Clean Air Act.” On December 21, 2020, Defendants published
the proposed motor vehicle emissions rules in the Minnesota State Register and
scheduled public hearings to occur on February 22 and 23, 2021.
emissions rules provide that, except for Part 7023.0300, subpart 4 (the Early Action
Credit Provision), the rules will become effective only “after the [California] standards
incorporated by reference . . . are granted a waiver by the U.S. Environmental Protection
Agency under [the Clean Air Act].”
In a Statement of Need and Reasonableness
(SONAR) dated December 14, 2020, Defendants similarly assert that the proposed
emissions rules will “not go into effect until the waiver issue between California and the
EPA is resolved,” and that “even then, the rule[s] would become effective only after the
MPCA publishes a notice to the State Register that would inform the regulated parties
and the public that the waiver has been restored.” The SONAR also contends that,
because the Clean Air Act requires state emission standards to be adopted at least two
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years before the vehicle model year to which the standards will apply, compliance with
Defendants’ proposed emissions rules, if adopted, would not be required until at least two
years after their effective date.
Although Defendants’ proposed emissions rules have an effective date that is
delayed indefinitely and contingent on the resolution of the ongoing federal preemption
waiver dispute between California and the EPA, the Early Action Credit Provision in
Defendants’ proposed rules will go into effect earlier. Specifically, according to the
SONAR, “[t]he early action credit mechanism would go into effect five working days
after the MPCA publishes a Notice of Adoption in the State Register following
completion of the rulemaking process.” Under the Early Action Credit Provision, motor
vehicle manufacturers may begin to accrue credits for zero-emission vehicles delivered
for sale in Minnesota before the Defendants’ proposed emissions rules go into effect.
Defendants’ SONAR provides that “the early action credit system is a voluntary
flexibility offered to manufacturers, not a requirement of the rule,” and the intent of the
Early Action Credit Provision “is to offer an early incentive to manufacturers to deliver
[electronic vehicles] to Minnesota sooner than required by the rule.”
MADA commenced this action on January 6, 2021.
MADA alleges that
Defendants’ proposed emissions rules are preempted by federal law and, as such,
Defendants’ ongoing rulemaking conduct is illegal. According to MADA, Defendants’
illegal rulemaking conduct threatens imminent harm to MADA because its members will
“(1) lose sales if they can stock and sell only California compliant vehicles and (2) incur
costs from stocking increased numbers of [zero-emission vehicles].” Count One of
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MADA’s complaint seeks an order enjoining Defendants from attempting to regulate
motor vehicle emissions standards in violation of the preemption provisions of the Clean
Air Act and the EPCA. Count Two and Count Three of MADA’s complaint seek a
declaratory judgment that Defendants lack the authority to regulate motor vehicle
emissions standards because of the preemption provisions of the Clean Air Act and the
On January 8, 2021, MADA moved for expedited preliminary injunctive relief,
seeking an order preliminarily enjoining Defendants from conducting rulemaking
proceedings pertaining to Defendants’ proposed emissions rules, including the public
hearings scheduled to occur on February 22 and 23, 2021.
On January 25, 2021,
Defendants moved to dismiss MADA’s complaint, arguing that MADA lacks standing,
MADA’s claims are not ripe for judicial review, and the complaint fails to state a claim
on which relief can be granted. In the alternative, Defendants contend that MADA has
not satisfied its burden to establish that a preliminary injunction is warranted.
On February 16, 2021, three third-party organizations—the Minnesota Center for
Environmental Advocacy, Fresh Energy, and MN350 (collectively, “Proposed
Intervenors”)—moved to intervene as Defendants in this case to protect their interests in
ensuring the adoption of Defendants’ proposed emissions rules.
Defendants’ Motion to Dismiss
Defendants move to dismiss MADA’s complaint pursuant to Rules 12(b)(1) and
12(b)(6), Fed. R. Civ. P., on four alternative grounds: (1) MADA’s claims are barred by
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sovereign immunity, (2) MADA lacks standing, (3) MADA’s claims are not ripe for
judicial review, and (4) MADA fails to state a claim on which relief can be granted.
A defendant may challenge a plaintiff’s complaint for lack of subject-matter
jurisdiction either on its face or on the factual truthfulness of its averments. See Fed. R.
Civ. P. 12(b)(1); Titus v. Sullivan, 4 F.3d 590, 593 (8th Cir. 1993). In a facial challenge,
as presented here, the nonmoving party “receives the same protections as it would
defending against a motion brought under Rule 12(b)(6).” Osborn v. United States, 918
F.2d 724, 729 n.6 (8th Cir. 1990).
Under Rule 12(b)(6), a complaint must be dismissed if it fails to state a claim on
which relief can be granted. Fed. R. Civ. P. 12(b)(6). To survive a Rule 12(b)(6) motion,
the complaint must allege sufficient facts that, when accepted as true, state a facially
plausible claim to relief. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). When determining
whether the complaint states such a claim, a district court accepts as true all factual
allegations in the complaint and draws all reasonable inferences in the plaintiff’s favor.
Blankenship v. USA Truck, Inc., 601 F.3d 852, 853 (8th Cir. 2010).
allegations need not be detailed, but they must be sufficient to “raise a right to relief
above the speculative level” and “state a claim to relief that is plausible on its face.” Bell
Atl. Corp. v. Twombly, 550 U.S. 544, 555, 570 (2007). A plaintiff must offer more than
“labels and conclusions” or a “formulaic recitation of the elements of a cause of action.”
Id. at 555. Legal conclusions that are couched as factual allegations may be disregarded
by the district court. See Iqbal, 556 U.S. at 678–79.
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Because sovereign immunity, standing, and ripeness implicate the Court’s subjectmatter jurisdiction, the Court addresses arguments pertaining to these matters first.
Defendants contend that MADA’s claims are barred because Defendants are
entitled to sovereign immunity. Sovereign immunity is a threshold issue, as it implicates
a federal court’s subject-matter jurisdiction. Harmon Indus., Inc. v. Browner, 191 F.3d
894, 903 (8th Cir. 1999).
The Eleventh Amendment to the United States Constitution entitles states to
sovereign immunity, which prevents any federal court from exercising jurisdiction over a
lawsuit against a state. U.S. Const. amend. XI; accord Seminole Tribe of Fla. v. Florida,
517 U.S. 44, 54 (1996). Sovereign immunity bars a plaintiff from suing a state or its
agencies in federal court absent consent or congressional abrogation of immunity.
Monroe v. Ark. State Univ., 495 F.3d 591, 594 (8th Cir. 2007); Doe v. Nebraska, 345
F.3d 593, 597 (8th Cir. 2003). The MPCA is an agency of the State of Minnesota, see
Minn. Stat. § 114D.25, and Minnesota has not consented to be sued in federal court.
Indeed, MADA does not dispute that the State of Minnesota and the MPCA are entitled
to sovereign immunity.1 Accordingly, the Court lacks subject-matter jurisdiction over
MADA’s claims as asserted against the State of Minnesota and the MPCA.
In its memorandum of law, MADA asserts that it “is not suing the MPCA or the
state of Minnesota.” Contrary to this assertion, MADA’s complaint separately references
both “Defendant MPCA” and “Defendant Laura Bishop,” and the complaint provides that
the State of Minnesota “is also a defendant in this matter.” As such, the Court construes
MADA’s position as a concession that Defendants State of Minnesota and MPCA should
be dismissed from this action.
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MADA also names Bishop, in her official capacity as the Commissioner of the
MPCA (Commissioner), as a defendant. Bishop argues that she, too, is entitled to
sovereign immunity. MADA counters that the Ex parte Young doctrine, an exception to
sovereign immunity, permits MADA to assert its claims against Bishop.
The Eleventh Amendment bars a plaintiff from suing a state official in her official
capacity except for certain claims seeking prospective equitable relief. Kentucky v.
Graham, 473 U.S. 159, 165–66, 169 (1985); Murphy v. Arkansas, 127 F.3d 750, 754 (8th
Cir. 1997). Under the Ex parte Young doctrine, “a private party can sue a state officer in
[her] official capacity to enjoin a prospective action that would violate federal law.” 281
Care Comm. v. Arneson, 638 F.3d 621, 632 (8th Cir. 2011). “In determining whether this
exception applies, a court conducts a straightforward inquiry into whether [the] complaint
alleges an ongoing violation of federal law and seeks relief properly characterized as
prospective.” Id. (internal quotation marks omitted) (alteration in original). But “[t]he
Ex parte Young exception only applies against officials ‘who threaten and are about to
commence proceedings, either of a civil or criminal nature, to enforce . . . an
unconstitutional act.” 281 Care Comm. v. Arneson, 766 F.3d 774, 797 (8th Cir. 2014)
(quoting Ex parte Young, 209 U.S. 123, 156 (1908)). “The Ex parte Young doctrine does
not apply when the defendant official has neither enforced nor threated to enforce the
statute challenged as unconstitutional.” Id. (internal quotation marks omitted).
Typically, the Ex parte Young exception to sovereign immunity permits “nothing
more than the pre-emptive assertion in equity of a defense that would otherwise have
been available in the State’s enforcement proceedings at law.” Va. Office for Prot. &
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Advoc. v. Stewart, 563 U.S. 247, 262 (2011) (Kennedy, J., concurring). As such, the Ex
parte Young doctrine applies “[w]hen enforcement actions are imminent . . . and the
moving party lacks the realistic option of violating the law once and raising its federal
defenses,” because in such circumstances “there is no adequate remedy at law.” Morales
v. Trans World Airlines, Inc., 504 U.S. 374, 381 (1992).
Here, it is undisputed that the Commissioner has not enforced Minnesota’s
proposed emissions rules.
Those rules have neither been adopted nor taken effect.
MADA cites no legal authority—and the Court’s research has found none—in which the
Ex parte Young doctrine has abrogated a state official’s sovereign immunity because that
official has engaged in administrative rulemaking as opposed to enforcing or threatening
to enforce an existing rule. At best, MADA alleges that the Commissioner has implicitly
threatened to enforce the proposed emissions rules when those rules take effect. But the
proposed emissions rules may not ever take effect if California’s preemption waiver
under the Clean Air Act is not reinstated. And if the proposed emissions rules do take
effect, it is undisputed that the rules cannot be enforced until several years from now.
Because MADA has not demonstrated that the Commissioner has threatened to
commence a civil or criminal enforcement action imminently, the Ex parte Young
doctrine does not apply.
MADA argues that the Early Action Credit Provision of Minnesota’s proposed
emissions rules could take effect sooner, possibly within the next six months. The Early
Action Credit Provision permits motor vehicle manufacturers to begin to accrue credits
for zero-emission vehicles delivered for sale in Minnesota before Minnesota’s proposed
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emissions rules go into effect. But this provision merely offers incentives to motor
vehicle manufacturers that voluntarily take certain actions. The Early Action Credit
Provision does not threaten or even authorize civil or criminal enforcement against any
person or entity.
MADA emphasizes that Defendants’ rulemaking documents have
referred to the Early Action Credit Provision as an “enforcement mechanism.” But that
terminology—which, according to Defendants, is a term of art that differentiates the
credit system from an emissions “standard”—does not alter the substance of the Early
Action Credit Provision, the language of which plainly does not threaten or authorize
civil or criminal enforcement.
Because Minnesota’s proposed Early Action Credit
Provision neither threatens nor authorizes enforcement actions of any kind, the Ex parte
Young doctrine does not apply.
For these reasons, sovereign immunity bars MADA’s claims against Defendants.
Therefore, the Court lacks subject-matter jurisdiction over MADA’s claims.
Defendants also argue that, even if they were not entitled to sovereign immunity,
MADA lacks standing, which implicates this Court’s subject-matter jurisdiction over
MADA’s claims. See Faibisch v. Univ. of Minn., 304 F.3d 797, 801 (8th Cir. 2002). The
jurisdiction of federal courts extends only to actual cases or controversies. U.S. Const.
art. III, § 2, cl. 1; accord Neighborhood Transp. Network, Inc. v. Pena, 42 F.3d 1169,
1172 (8th Cir. 1994). To satisfy the case-or-controversy requirement of Article III of the
United States Constitution, a plaintiff must establish standing as an “indispensable part of
the plaintiff’s case.” Lujan v. Defs. of Wildlife, 504 U.S. 555, 561 (1992); accord Hargis
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v. Access Cap. Funding, LLC, 674 F.3d 783, 790 (8th Cir. 2012). To meet this standing
requirement, the plaintiff must (1) have suffered an injury in fact, (2) establish a causal
relationship such that the alleged injury is fairly traceable to the defendant’s challenged
conduct, and (3) show that a favorable decision would redress the injury. Lujan, 504 U.S.
at 560–61; accord Hargis, 674 F.3d at 790.
MADA is an association rather than an individual plaintiff. An association can
have standing on its own behalf or on behalf of its members. See Bowman v. W. Auto
Supply Co., 985 F.2d 383, 388 (8th Cir. 1993). An association has standing on behalf of
its members when “(a) its members would otherwise have standing to sue in their own
right; (b) the interests it seeks to protect are germane to the organization’s purpose; and
(c) neither the claim asserted nor the relief requested requires the participation of
individual members in the lawsuit.” Hunt v. Wash. State Apple Advert. Comm’n, 432 U.S.
333, 343 (1977). As to the first element, an association can have standing even if only
one member has standing.
Id. at 342.
But a member’s interest cannot be merely
“abstract concern” or “unadorned speculation.” Simon v. E. Ky. Welfare Rights Org., 426
U.S. 26, 40, 44 (1976).
Defendants contend that MADA lacks standing because MADA has not
sufficiently alleged either an injury in fact or a causal relationship between the challenged
conduct and the alleged injury.
Injury in Fact
To allege an “injury in fact” that confers standing to seek injunctive relief, a
plaintiff must face a threat of ongoing or future harm. Park v. Forest Serv. of the U.S.,
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205 F.3d 1034, 1037 (8th Cir. 2000). An injury in fact “must be concrete, particularized,
and actual or imminent.” Clapper v. Amnesty Int’l USA, 568 U.S. 398, 409 (2013)
(internal quotation marks omitted). The purpose of the imminence requirement “is to
ensure that the alleged injury is not too speculative for Article III purposes—that the
injury is certainly impending.” Id. (internal quotation marks omitted). Allegations of a
possible future injury are insufficient to confer standing. Id.
In Clapper, the Supreme Court of the United States held that the plaintiffs lacked
standing because a “speculative chain of possibilities” could not establish an injury in
fact based on potential future injuries. Id. at 414. The plaintiffs sought a declaration that
Section 702 of the Foreign Intelligence Surveillance Act of 1978 is unconstitutional and
an injunction against surveillance authorized by that section. Id. at 401. The plaintiffs
attempted to establish an injury in fact based on an objectively reasonable likelihood that
their communications would be acquired pursuant to the challenged law at some point in
the future. Id. Rejecting that argument, the Supreme Court observed that the plaintiffs’
possible future injury depended on a “highly speculative fear” that a lengthy chain of
events would occur. Id. at 410.
Here, MADA’s complaint alleges two forms of injury. First, MADA alleges that
its members will lose sales if they can stock and sell only vehicles that comply with the
California emissions standards that Minnesota seeks to adopt. Second, MADA alleges
that its members will incur costs from stocking increased numbers of zero-emission
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vehicles. MADA also alleges that its members will suffer a competitive disadvantage
because dealerships in neighboring states will not be subject to the same restrictions.2
To establish standing, MADA must allege an injury that is “imminent” and
“certainly impending.” Id. at 409 (internal quotation marks omitted). “When a state or
local law imposes compliance burdens on those it regulates or controls, and compliance is
coerced by the threat of enforcement . . . the controversy is both immediate and real.”
Keller v. City of Fremont, 719 F.3d 931, 947 (8th Cir. 2013) (internal quotation marks
omitted). But the impact of the regulation must be “direct and immediate,” and the
plaintiff must “allege an actual, well-founded fear that the law will be enforced against
them.” Id. (internal quotation marks omitted).
Here, it is undisputed that most of Defendants’ proposed emissions rules will not
be enforced in a manner that impacts MADA’s members, if at all, until more than two
years from now.3 Indeed, Defendants’ proposed emissions rules might never take effect,
depending on how the ongoing waiver dispute between California and the EPA is
In its memoranda of law, MADA also argues that its members will lose customer
goodwill and sustain reputational harm. But because neither of these purported harms is
alleged in MADA’s complaint, the Court need not consider these purported injuries.
MADA’s arguments focus on the timing of the adoption of Defendants’ proposed
emissions rules and, to a lesser extent, the effective date of those rules. MADA’s focus
on adoption and effective dates is misplaced. To establish Article III standing, the
alleged injury must be imminent. Significantly, most of the alleged injuries to MADA’s
members will not coincide with either the adoption date or the effective date of
Defendants’ proposed emissions rules, but instead would arise years later when those
rules are enforced. MADA does not dispute that the Clean Air Act imposes a two-year
delay between the effective date and the enforcement date of a state’s emissions rules.
As such, most of the alleged injuries to MADA’s members will not arise until at least
several years from now, if at all.
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resolved. Even if that dispute is resolved such that California’s waiver is reinstated,
Defendants’ proposed emissions rules must go through multiple additional steps in the
administrative rulemaking process before taking effect, followed by a delay in time
before the rules are enforced. By that time, several years in the future, it is possible that
other factors relevant to MADA’s alleged injuries will have changed, including the
applicable federal emissions standards, the applicable California emissions standards, the
business relationships between automobile manufacturers and dealerships, and the market
for zero-emission vehicles. Moreover, the resolution of California’s waiver dispute could
render MADA’s preemption theory moot before any anticipated harm befalls MADA’s
For these reasons, the alleged injuries to MADA’s members are neither
imminent nor certainly impending, at least with respect to the aspects of Defendants’
proposed emissions rules that are contingent on a particular resolution of California’s
ongoing waiver dispute.
MADA contends, however, that the Early Action Credit Provision of Defendants’
proposed emissions rules will cause certain imminent injuries to MADA’s members.
Because the Early Action Credit Provision is not contingent on a resolution of
California’s waiver dispute, this provision could take effect later this year. As such,
MADA argues, it is undisputed that the effective date of the Early Action Credit
Provision could occur much sooner than the effective date of the other portions of
Defendants’ proposed emissions rules. But the Early Action Credit Provision must go
through at least several more months of administrative rulemaking procedures, including
but not limited to public hearings in February, a written comment period that ends in
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April, the issuance of an Administrative Law Judge’s (ALJ) report in May, and a review
by the office of the Governor of Minnesota thereafter. Any one of these future steps in
the administrative rulemaking process could result in additional delays, material revisions
to the Early Action Credit Provision, or elimination of the Early Action Credit Provision
altogether. And even if the Early Action Credit Provision takes effect in its currently
proposed form, any alleged injuries to MADA’s members would also depend on motor
vehicle manufacturers voluntarily choosing to seek early-action credits. As such, the
alleged injuries arising from the Early Action Credit Provision are neither imminent nor
certainly impending. The existence of these injuries is remote in time and depends on a
lengthy chain of events, the outcome of which remains uncertain.
MADA contends that its members “will not be able to recover [the] losses or the
costs of participating in the rulemaking” process. But this argument is unavailing for at
least four reasons. First, this purported harm is not alleged in the complaint. Second,
MADA offers no substantiation for this purported harm. Third, MADA has neither
alleged nor established that engaging in administrative rulemaking is or can be preempted
by federal law—a contention that is contrary to law. Cf. Murphy v. Nat’l Collegiate
Athletic Ass’n, 138 S. Ct. 1461, 1481 (2018) (holding that federal law cannot prohibit,
through preemption, a state legislative or rulemaking process); Motor Vehicle Mfrs. Ass’n
of U.S., Inc. v. N.Y. State Dep’t of Env’t Conservation, 17 F.3d 521, 533–34 (2d Cir.
1994) (concluding that New York may adopt preempted emissions standards so long as
the state “makes no attempt to enforce” the standards before a preemption waiver has
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been obtained). 4 Fourth, MADA has provided no legal authority—and the Court’s
research has not identified any—establishing that the cost of participating in an
administrative rulemaking process is a redressable harm. See Lujan, 504 U.S. at 560–61
(recognizing that Article III standing requires a plaintiff to show that a favorable decision
would redress the alleged injury).
Part of the relief MADA seeks is a declaratory judgment that the mere adoption of
Defendants’ proposed emissions rules will be unlawful, even if the harmful effects of the
enforcement of those rules do not occur until later. “The essential distinction between a
declaratory judgment action and an action seeking other relief is that in the former no
actual wrong need have been committed or loss have occurred in order to sustain the
action.” County of Mille Lacs v. Benjamin, 361 F.3d 460, 464 (8th Cir. 2004) (internal
quotation marks omitted).
But “[t]he controversy requirement of the Declaratory
Judgment Act is synonymous with that of Article III of the Constitution.” Id. at 463
(internal quotation marks omitted).
And a plaintiff seeking declaratory relief must
demonstrate that the plaintiff has suffered at least a threatened injury. See, e.g., id. at 464
(affirming dismissal of declaratory-judgment action for lack of standing because
allegations in the complaint “do not establish an injury in fact” but instead, “[a]t best, . . .
MADA’s reliance on Middle South Energy, Inc. v. Arkansas Public Service
Commission, 772 F.2d 404 (8th Cir. 1985), is misplaced. At issue in Middle South
Energy was an injunction preventing quasi-judicial state administrative proceedings that
threatened imminent enforcement of state law. 772 F.2d at 413. The circumstances in
Middle South Energy are materially distinct from the circumstances in this case, which
involve an attempt to enjoin ongoing administrative rulemaking pertaining to yet-to-beadopted rules, for which no threat of imminent enforcement exists. Moreover, the
Supreme Court subsequently made clear in Murphy that federal preemption cannot bar a
state from conducting administrative rulemaking. See 138 S. Ct. at 1481.
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reflect speculative harms”). Here, for all the reasons addressed above, the injuries that
MADA alleges are too speculative and remote to satisfy this standard.
Accordingly, MADA has not alleged an injury in fact sufficient to establish
Article III standing.
Even if any of MADA’s alleged injuries were sufficiently imminent and certainly
impending, MADA also must demonstrate that the alleged injury is fairly traceable to
Defendants’ allegedly illegal conduct. Lujan, 504 U.S. at 560.
For an injury to be fairly traceable to a defendant’s conduct, it must not be the
result of “the independent action of some third party not before the court.” Id. (internal
quotation marks omitted). But an alleged injury may be fairly traceable to a defendant if
the injury is “produced by determinative or coercive effect upon the action of someone
Bennett v. Spear, 520 U.S. 154, 169 (1997).
As such, traceability may be
established based on “the predictable effect of Government action on the decisions of
third parties” as opposed to “mere speculation about the decisions of third parties.” Dep’t
of Commerce v. New York, 139 S. Ct. 2551, 2566 (2019).
Here, the injuries MADA alleges are predicated on the independent decisions of
multiple third parties. First, the participants in the ongoing administrative rulemaking
process—including the ALJ and the Governor of Minnesota—must decide to adopt the
proposed emissions rules, including the Early Action Credit Provision, without
alterations. Second, if the Early Action Credit Provision is adopted without alterations,
motor vehicle manufacturers must voluntarily choose to seek early-action credits by
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increasing their delivery of zero-emission vehicles to dealerships in Minnesota.5 Third,
the dealerships must choose to accept additional zero-emission vehicles and, in turn, the
motor vehicle manufacturers must choose not to reimburse or otherwise offset any
additional costs or burdens that such deliveries might impose on the dealerships. These
decisions may depend in part on the business relationships and negotiations between
individual manufacturers and individual dealerships, including existing agreements and
possible modifications to those agreements.
Fourth, whether the remainder of
Minnesota’s proposed emissions rules ever take effect will depend on the reinstatement
of California’s preemption waiver, which will depend on decisions made by numerous
third parties, including the judges of the D.C. Circuit and officials at the EPA and
NHTSA. Fifth, MADA’s alleged injuries assume that, in several years’ time, Minnesota
consumers will choose not to purchase the increased volume of zero-emission vehicles.
To be sure, some of the steps in the foregoing chain of third-party decisions might
be more predictable than others. But in its totality, this long chain of decisions does not
demonstrate that MADA’s alleged injuries will be “the predictable effect” of Defendants’
Although this voluntary decision may be influenced by the incentives offered by
the Early Action Credit Provision, motor vehicle manufacturers are under no risk of civil
or criminal penalty for deciding not to seek early-action credits, nor are manufacturers
guaranteed to reap any benefit if they do, given that Minnesota’s proposed emissions
rules might never take effect. As such, the incentives of the Early Action Credit
Provision do not clearly produce a determinative or coercive effect on the actions of
motor vehicle manufacturers. Contra Dep’t of Commerce, 139 S. Ct. at 2566 (concluding
that plaintiffs had satisfied their burden by showing, through historical evidence, that
third parties were likely to act in predictable ways to the challenged government action);
Bennett, 520 U.S. at 170 (concluding that the risk of civil and criminal penalties created a
coercive effect on third parties to take action that was ostensibly optional).
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conduct as opposed to “mere speculation about the decisions of third parties.” Id. As
such, MADA’s alleged injuries are not fairly traceable to Defendants’ conduct.
In summary, MADA has not alleged either an injury in fact or that any alleged
injury is fairly traceable to Defendants’ conduct. Accordingly, MADA lacks Article III
standing and, in turn, this Court lacks subject-matter jurisdiction over MADA’s claims.
Defendants also argue that this Court lacks subject-matter jurisdiction because
MADA’s claims are not ripe for judicial review.
“Standing and ripeness are sometimes closely related” and, when assessing
ripeness, courts “focus on whether the case involves contingent future events that may
not occur as anticipated, or indeed may not occur at all.” Kennedy v. Ferguson, 679 F.3d
998, 1001 (8th Cir. 2012) (internal quotation marks omitted); accord Pub. Water Supply
Dist. No. 10 v. City of Peculiar, 345 F.3d 570, 573 (8th Cir. 2003) (providing that a “case
is more likely to be ripe if it poses a purely legal question and is not contingent on future
possibilities”). “The doctrine of ripeness is basically a matter of timing, which requires
(1) a sufficiently concrete case or controversy within the meaning of Article III of the
Constitution, and also, (2) prudential considerations must justify the present exercise of
judicial power.” Gopher Oil Co. v. Bunker, 84 F.3d 1047, 1050 (8th Cir. 1996) (internal
quotation marks omitted). When a plaintiff seeks a declaratory judgment, “there must
exist a substantial controversy between the parties having adverse legal interests, of
sufficient immediacy and reality to warrant the issuance of a declaratory judgment.” Id.
(internal quotation marks omitted).
CASE 0:21-cv-00053-WMW-ECW Doc. 48 Filed 02/17/21 Page 20 of 22
The ripeness inquiry requires a court to examine “the fitness of the issues for
judicial decision and the hardship to the parties of withholding court consideration.”
Neb. Pub. Power Dist. v. MidAmerican Energy Co., 234 F.3d 1032, 1038 (8th Cir. 2000)
(internal quotation marks omitted). In the administrative context, when determining
whether an issue is fit for judicial review, courts may consider whether the issues are
based on final agency action and whether the controversy has a direct and immediate
impact on the plaintiff’s business. Lane v. U.S. Dep’t of Agric., 187 F.3d 793, 795 (8th
The issues presented in this case are not based on final agency action and do not
involve a direct and immediate impact on MADA’s members’ businesses. Federal courts
“may review final agency rules,” but federal courts “do not have authority to review
proposed rules.” In re Murray Energy Corp., 788 F.3d 330, 334 (D.C. Cir. 2015). As
addressed above, MADA challenges administrative rules that have not been adopted,
have not taken effect, and have not been enforced. These rules will not be enforced, if at
all, until several years from now. Moreover, as also addressed above, MADA’s alleged
injuries depend on contingent future events that may not occur as anticipated, if at all,
and will not arise for months, if not years. For these reasons, MADA’s challenge to
Defendants’ proposed emissions rules are not ripe for judicial review.
MADA also challenges the Defendants’ ongoing administrative rulemaking
process directly. But federal preemption—the theory on which MADA’s entire lawsuit
relies—is implicated when “a federal law . . . regulates the conduct of private actors, not
the States.” Murphy, 138 S. Ct. at 1481. Because the anticommandeering doctrine
CASE 0:21-cv-00053-WMW-ECW Doc. 48 Filed 02/17/21 Page 21 of 22
prohibits Congress from dictating what laws or regulations a state may or may not enact,
a federal preemption provision cannot prohibit a state from conducting administrative
This is true even if the proposed rule, if adopted, would be
preempted by federal law. See id. Thus, Defendants’ ongoing administrative rulemaking
process is not subject to MADA’s challenge.
Accordingly, MADA’s claims are not ripe for judicial review. Therefore, the
Court lacks subject-matter jurisdiction over MADA’s claims.
Failure to State a Claim
Defendants argue in the alternative that MADA’s complaint should be dismissed
because MADA fails to state a claim on which relief can be granted. See Fed. R. Civ. P.
Because MADA’s claims must be dismissed for lack of subject-matter
jurisdiction for the reasons addressed above, the Court need not address Defendants’
alternative basis for seeking dismissal.
Motion for Preliminary Injunction and Motion to Intervene
MADA also moves for a preliminary injunction, and the Proposed Intervenors
move to intervene as Defendants in this case. In light of the Court’s conclusion that
MADA’s claims must be dismissed for lack of subject-matter jurisdiction, MADA’s
motion for a preliminary injunction and the Proposed Intervenors’ motion to intervene
must be denied as moot.
Based on the foregoing analysis and all the files, records and proceedings herein,
IT IS HEREBY ORDERED:
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Defendants’ motion to dismiss, (Dkt. 28), is GRANTED.
Plaintiff’s complaint, (Dkt. 1), is DISMISSED WITHOUT PREJUDICE
for lack of subject-matter jurisdiction.
Plaintiff’s motion for a preliminary injunction, (Dkt. 13), is DENIED as
Proposed Intervenors’ motion to intervene, (Dkt. 38), is DENIED as moot.
LET JUDGMENT BE ENTERED ACCORDINGLY.
Dated: February 17, 2021
s/Wilhelmina M. Wright
Wilhelmina M. Wright
United States District Judge
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