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Ced's, Inc. v. EPA

Citation: 14 ELR 20869
No. No. 83-2608, 745 F.2d 1092/21 ERC 1843/(7th Cir., 09/28/1984)

The court holds that Clean Air Act § 114(a) empowers the Environmental Protection Agency (EPA) to inspect the ordinary business records of an automobile parts manufacturer that could be causing others to use its products to tamper with vehicle emission control systems unlawfully. Ced's manufactures a product, the "Test Tube," which is designed to be temporarily installed in lieu of a car's catalytic converter to aid in diagnosis of emissions problems, but whose permanent installation is unlawful unless performed by the automobile's owner. The court first notes that the district court, which ruled against EPA, exceeded its jurisdiction in issuing supplemental conclusions of law after EPA filed a notice of appeal. The court then rules that EPA had authority under § 114(a) to inspect and copy Ced's records. First, Ced's is a person subject to the requirements of the Act within the meaning of § 114(a)(1). Though the Act does not control the manufacture of Ced's product, § 203(a)(3)(B) prohibits certain automotive professionals and fleet owners from using such products to permanently disable emission control systems, and § 203(a) generally prohibits the causing of an action prohibited in § 203(a)(3)(B). That Congress considered amending § 203(a) in 1982 to explicitly cover auto parts makers, but did not, is irrelevant; the 1977 legislative history clearly states that § 114 empowered EPA to inspect parts makers to assure compliance with anti-tampering prohibitions.

Second, § 114(a)(2) allows EPA to inspect records of any person subject to a requirement of the Act. The district court had erroneously read § 114(a)(2) to apply only to persons that EPA had ordered to keep special records under § 114(a)(1). The natural language of § 114(a) and the character of the 1977 amendments to the subsecution support a broader reading than the district court's.

Third, § 114(a)(2)(B) allows EPA to inspect any records, not just records that it had ordered kept under § 114(a)(1). The plain language of the subsection, including the lack of qualifiers limiting other § 114(a)(2) powers to matters prescribed under § 114(a)(1), supports this reading. If EPA could only inspect those records it had specially ordered, EPA would be forced to order firms to keep ordinary business records, imposing an arbitrary and meaningless exercise on the Agency.

Counsel for Appellants
Arthur E. Gowran
Land and Natural Resources Division
Department of Justice, Washington DC 20530
(202) 633-2754

Counsel for Appellee
James Morrin
Wildman, Harrold, Allen & Dixon
One IBM Plaza, Suite 3000, Chicago IL 60611
(312) 222-0400

Before ESCHBACH and FLAUM, Circuit Judges, and JAMESON, Senior District Judge.*