The Nickel Report

We are serious.  And don’t call us Shirley.

So EPA sent your company a dreaded Request for Information (“RFI”).  What do you do now?  If you’ve never been through this process before, you likely have a lot running through your head:

• Did our company do something wrong?  Is my company under investigation?
• Is this EPA’s way of asking for my help to improve its regulations?
• Do I have to answer this?
• How can I possibly compile all this information in 30 days?
• Do we need a lawyer to help us respond?
• What about confidential information?  EPA is asking for customer or supplier information.  Isn’t that private?

The Clean Air Act sections 114 and 208, the Clean Water Act section 308, and CERCLA section 104 all grant EPA authority to issue RFIs.  Under each of these authorities, EPA uses RFIs for three primary purposes:  (1) to determine whether a company or facility is in compliance with applicable regulations; (2) to investigate violations; or (3) to develop or modify regulations.  While EPA frequently does not explain its intent when issuing the RFI, specific language in the cover letter or the request itself can often provide a good clue to EPA’s particular purpose.  It is important to take time to read and fully understand the RFI to ensure that a response that (1) is complete, (2) is accurate, and (3) limits, to the extent possible, any exposure to liability.

In past years there was a sharp increase in EPA’s use of RFIs as a means to initiate an enforcement action.  EPA’s emphasis on enforcement over compliance assistance led many EPA regions to use RFIs as a discovery device, similar to issuing a grand jury subpoena for documents in a criminal investigation.  It is not yet clear whether that trend will continue, since key compliance and enforcement roles in the Trump Administration’s EPA have only recently been filled.  Will EPA cease using the RFI mechanism?  Will we start seeing RFIs issued purely for informational purposes and less for enforcement?

Few public clues have been shared to indicate how the Trump Administration will use RFIs.  Susan Bodine, EPA’s recently confirmed Assistant Administrator for the Office of Enforcement and Compliance Assurance, has indicated her intention to launch more “informal” enforcement actions that aim to achieve immediate compliance, a goal that does not necessarily comport with a typically protracted RFI process.  In addition, both Bodine and EPA Administrator Scott Pruitt have made numerous public statements of their intention to emphasize state enforcement for federally delegated programs, thus leaving RFIs for other purposes – determining compliance and developing or modifying regulations.  Some EPA regions, however, may also use RFIs to seek information about compliance with state regulations.  Region 9, for instance, appears to be ramping up its use of these requests, including issuing them for state regulations such as California’s mobile source regulations.  Recently, EPA has issued several RFIs pursuant to its Clean Air Act section 114 authority seeking information regarding California’s mobile source regulations, such as the Truck and Bus Regulation and the Drayage Truck Regulation.

In any case, as discussed below, it is important to be aware of several key issues of concern in responding to such requests.

Issues of Concern

Regardless of the reason for the RFI, there are several key concerns applicable to every response:

• Deadlines:  EPA usually provides 30-45 days for a company to respond to an RFI.  Whether the response involves 5 questions or 20, a thousand pages of documents or one hundred thousand, 30 days is often unreasonable, and, with the requirement to certify that the response is true, accurate, and complete, such a timeline is nearly impossible.  A 30-day deadline for a complex request arguably presumes the responding company can dedicate staff full time to generating the response.  But what if your company only has a few employees?  What if the main source of information is on vacation or otherwise indisposed?  It takes time to get organized.  It takes time to get your legal team up to speed.  It takes time to compile the information and ensure it is in the requested form.  The burden on any size business can be significant, but that impact is especially magnified for smaller businesses.  So, what can be done?  One approach is to ask for an extension.  More often than not, EPA is amenable to allowing more time for response.
• Scope and Authority:  EPA generally cites its authority for the RFI in the introductory paragraphs.  It is important to read the cited statute carefully; it may limit EPA’s authority.  It is also important to keep the authorizing statute in mind when reading the request.  Was the request issued for purposes described in the statute?  If not, then the request may be outside of EPA’s scope and authority.
• Preservation of Information:  Spoliation (alteration, destruction, or withholding) of company records after receipt of an RFI is one of the worst things a company can do. Depending on the posture of the proceedings (criminal, civil, administrative), spoliation could result in financial penalties or imprisonment.  Upon receipt of an RFI, the responding company should institute measures to preserve records, including emails and electronic records.
• Confidential Business Information: In many cases, the response will involve the submittal of confidential business information (“CBI”).  Typically, EPA demands justification for any CBI claims be submitted simultaneously with the response.  EPA may even pose specific questions to be answered for each claim of CBI.  Despite EPA’s practice of instructing that justification for CBI claims be submitted with the response, the statutes do not typically require that, and companies should be sure they have reviewed such demands with their legal counsel.  For example, EPA provides specific regulations governing CBI (40 C.F.R. Part 2).  Regardless of when or if justification is submitted, a responding company should be careful to ensure any CBI is clearly marked and should consider identifying the type of CBI being submitted in any cover letter.

What about privacy concerns?  Can EPA ask for customer or supplier information?  Certain information, the disclosure of which may be cause for concern from a business standpoint, may not be covered under EPA’s CBI regulations but may be subject to other legal protection.   Disclosure of information such as customer contact information is a significant legal issue that requires case-by-case analysis of the particular company involved and the information being disclosed.

• Certification:  Knowingly making false statements in response to an information request is punishable by fines or even imprisonment.  Every RFI requires a responsible official of the responding company to certify the information and documents submitted in the response.  EPA specifies the text of the certification statement in the RFI, but interestingly the wording of the statement is often inconsistent among regions, or even among different requests from the same region.  There is no statutory or regulatory requirement that the certification statement in an RFI contain specific language or take a specific form.  It is important to carefully review the certification statement provided and ensure it is consistent with the information and the process to which you are certifying.

Responding to an EPA request for information can be daunting even for veterans of the process.  Careful consideration of the issues identified above is key to protecting your company and the official who signs his/her name on the dotted line.