Jump to Navigation
Jump to Content

Ormet Corp. v. Ohio Power Co.

ELR Citation: 27 ELR 20302
Nos. 95-1835, 98 F.3d 799/(4th Cir., 10/23/1996) remanded for disposition on merits

The court holds that a federal district court has subject matter jurisdiction over a dispute involving ownership of marketable emissions allowances under the Clean Air Act (CAA). A contract between an aluminum manufacturer and a power company requires the power company to supply the manufacturer with specific amounts of power and requires the manufacturer to pay plant costs in proportion to the amount of power consumed. The manufacturer claimed entitlement to allowances proportional to its "ownership" in the power plant. The court first holds that the U.S. Environmental Protection Agency's (EPA's) reliance on the power company's representation of ownership did not constitute final agency action, reviewable only by a court of appeals. Congress intended to keep EPA out of the business of resolving competing claims to allowances. Thus, EPA appropriately refused to resolve the ownership issue here, and there was no EPA action to review. The court however, rejects the manufacturer's argument that CAA §408(i), which provides for allocating allowances among owners, creates a private cause of action for persons seeking entitlement to those allowances. Congress intended that disagreements over the allocation of allowances be resolved by existing methods of dispute resolution within the framework of existing commercial relationships. Nevertheless, because a court must interpret the CAA to resolve the dispute over the meaning of "owner" and the manufacturer's claim implicates a substantial federal interest, this action arises under federal law within the meaning of 28 U.S.C. §1331.

Counsel for Plaintiff
Charles S. Warren
Robinson, Silverman, Pearce, Aronsohn & Berman
1290 Avenue of the Americas, New York NY 10104
(212) 541-2000

Counsel for Defendants
Janet J. Henry
Porter, Wright, Morris & Arthur
41 S. High St., Columbus OH 43215
(614) 227-2000

Before WILKINS, NIEMEYER, and MICHAEL, Circuit Judges.