The Nickel Report

On September 22, 2021, the Division of Corporation Finance (Division) of the Securities and Exchange Commission (SEC) issued a sample comment letter to highlight its increased focus on climate change-related disclosures or the absence of such disclosures in issuer filings under the Securities Act and the Exchange Act. This sample comment letter follows a recent increase in climate-related comments the Division has issued during the disclosure review process, and many of the sample comments appear to be derived from actual comment letters issued in 2021. The sample is consistent with the SEC’s 2010 Guidance Regarding Disclosure Related to Climate Change, which does not mandate specific, line item climate change-related disclosures, but instead takes a principles-based approach.

The American Bar Association published an article, You’ve Come a Long Way Baby, or Have You?, which highlights the results of a new study by Hunton Andrews Kurth LLP attorneys Shannon S. Broome, Lauren Bachtel, and Jennifer MikoLevine, and environmental litigation specialist Richard M. Pavlak, shedding light on whether the environmental bar is achieving gender equality. The authors acknowledge and appreciate the important contributions of the late Richard Pavlak (who passed away unexpectedly shortly before the online version became available) for his graphical presentation of the results of the study.

Recent federal court decisions continue to show that Article III standing can be a formidable defense to environmental citizen suits, particularly following the Supreme Court’s decision Spokeo v. Robins, 578 U.S. 330 (2016) (vacating decision below and emphasizing that an alleged injury in fact must be “concrete and particularized”).  Just last week, for example, a North Carolina federal court dismissed on standing grounds almost all of the plaintiffs’ Clean Air Act citizen suit claims asserted against the University of North Carolina at Chapel Hill (UNC).  Center for Biological Diversity v. University of North Carolina, No. 1:19-CV-1179, 2021 U.S. Dist. LEXIS 163459 (M.D.N.C. Aug. 30, 2021).  In their complaint, the plaintiffs asserted nine claims, including seven for alleged failures to maintain records, inspect equipment, report permit deviations to government authorities, and monitor pollution controls, as required by UNC’s Title V permit.  On summary judgment, the plaintiff citizen groups offered declarations from two members who alleged “health, aesthetic, and recreational interests in air quality in Chapel Hill and the areas around UNC’s campus.”

As we have reported previously in this blog, in March 2021, the Massachusetts Governor signed historic climate legislation designed to effectuate the Commonwealth’s goal of net-zero emissions by 2050 (Chapter 8 of the Acts of 2021 or the “Act”). Some of the more controversial items in the Act were the provisions to incorporate requirements into the state’s building code to advance construction and/or retrofitting of buildings with energy systems designed to reduce emissions. In general, the efforts to facilitate a transition away from fossil-fuel energy systems in buildings continue to prove difficult as existing programs and policies are not necessarily designed to prompt the shift away from traditional energy systems at the pace that some argue is required to meet the aggressive emission targets of the state goals.

On August 30th, EPA granted the 2007 Petition from the Pesticide Action Network North America (PANNA) and the Natural Resources Defense Council (NRDC) requesting that EPA revoke all chlorpyrifos tolerances. This followed the Ninth Circuit order earlier this year for EPA to: “(1) grant the 2007 Petition; (2) issue a final regulation within 60 days following issuance of the mandate that either (a) revokes all chlorpyrifos tolerances or (b) modifies chlorpyrifos tolerances and simultaneously certifies that, with the tolerances so modified, the EPA "has determined that there is a reasonable certainty that no harm will result from aggregate exposure to the pesticide chemical residue, including all anticipated dietary exposures and all other exposures for which there is reliable information," including for "infants and children"; and (3) modify or cancel related FIFRA registrations for food use in a timely fashion consistent with the requirements of 21 U.S.C. § 346a(a)(1).”

8.18.2021 EPA Finalizes Hazard Assessments for Two Fuel Additives (ETBE and tert-Butanol):

On August 18^th, EPA finalized the long-awaited hazard assessments for both Ethyl Tertiary Butyl Ether (ETBE) and tert-Butyl Alcohol (tert-Butanol).  ETBE was previously added to gasoline to increase its octane levels. It is still registered with EPA for use as a fuel additive, but it is not used currently in the United States.  tert-Butanol is one of the primary metabolites of ETBE and has also been used as a fuel oxygenate. It is also used for other purposes including as a solvent and as a dehydrating agent.

In the face of accelerating EPA and state regulatory activity on per- and polyfluoroalkyl substances (“PFAS”)[i], Congress is pressing forward with measures that would address or impose limitations on these “forever chemicals.” More than thirty such legislative measures are currently pending in Congress covering a number of subjects related to PFAS including, but not limited to, those involving military uses, funding assistance, detection and research, product stewardship, site remediation, and regulatory mandates. Of these, the most comprehensive initiative ...

Last month, the Ninth Circuit Court of Appeals denied a petition for review brought by environmental non-governmental organizations (ENGOs) challenging EPA’s conclusion that the Phoenix-Mesa, Arizona metropolitan area, which had been designated nonattainment for a National Ambient Air Quality Standard (NAAQS) for ozone, had met that standard by the applicable deadline.  Bahr v. Regan, No. 20-70092, 2021 U.S. App. LEXIS 22333 (9th Cir. July 28, 2021).  Failure to have met the standard would have had implications in terms of additional air emission controls required in the area.

After a disappointing showing in Mexico’s recent mid-term elections, President Andrés Manuel López Obrador (commonly referred to as AMLO) and his party (i.e., Movimiento Regeneratión National or MORENA, commonly referred to as Morena) will face greater hurdles to unwinding “la Reforma Energética” (2013 Energy Reforms), the energy policy reforms adopted by the then-ruling party, the Partido Revolucionario Institucional (PRI).

In January, EPA obtained data that some mosquito control pesticides contained detectable levels of certain PFAS.  In a joint investigation with the State of Massachusetts, EPA found that fluorinated high-density polyethylene (HDPE) containers containing a mosquito control pesticide were leaching PFAS into the product. Now, EPA is testing different brands of fluorinated containers to determine whether they contain and/or leach PFAS and has asked the states with existing stocks of these pesticides to discontinue use as EPA evaluates the issue. Information on the EPA activities can be found here. EPA also began working with USDA and FDA to get a better understanding of the use of fluorinated polyethylene containers for pesticides and other products.