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Rocky Mountain Farmers Union v. Corey

ELR Citation: 49 ELR 20010
Nos. 17-16881, (9th Cir., 01/18/2019)

The Ninth Circuit affirmed a district court's dismissal of a constitutional challenge to California's 2015 Low Carbon Fuel Standard (LCFS). Farming groups argued that the state's LCFS violated the Commerce Clause and the federal structure of the Constitution by regulating extraterritorially. But the court found that the LCFS effectively regulated greenhouse gas emissions to minimize in-state harm caused by products sold in-state, a central aspect of state sovereignty, without crossing into impermissible interstate regulation. Moreover, the court found no reason to search beyond the Commerce Clause for constitutional limits on the ability of states to affect interstate commerce. The groups also argued that the LCFS facially discriminated against interstate commerce in its treatment of ethanol and crude oil. The court found it must consider the potential indirect effects of the LCFS on out-of-state commerce in a way that reflects that a state's ability to control its internal markets and combat local harms is squarely within its traditional police power. The court thus found the lower court correctly held that the LCFS was a permissible local regulation, and therefore affirmed dismissal of the groups' extraterritoriality and facial discrimination claims.