Last year, after a string of defeats for EPA in its NSR enforcement initiative, I suggested that the initiative was in trouble, but that EPA was probably not yet ready to concede defeat.  After the latest blow, earlier this month, EPA has to be reconsidering.  I assume that EPA won’t give up completely until it has lost everywhere or the Supreme Court has weighed in, but the NSR initiative is definitely on life support at this point.

In United States v. Luminant Generation Company, EPA may have suffered its worst defeat yet (albeit not in a court of appeals). Here’s the essence:

• EPA’s damage claims were time-barred by the general five-year statute of limitations.

• EPA’s injunctive relief claims were barred, for two separate reasons:

First, because the Clean Air Act permits injunctive relief for PSD/NSR claims prior to construction, it impliedly precludes injunctive relief after construction is complete.

Second, because the concurrent remedy doctrine bars injunctive relief where underlying legal claims are barred by the statute of limitations.

• EPA’s Title V claims fail because “the Clean Air Act does not authorize a collateral attack on a facially valid, but allegedly improper, state permit.”

It only adds insult to injury that EPA had another claim dismissed, notwithstanding a tolling agreement, because the tolling agreement applied only to violations alleged in a specific notice of violation issued by EPA, and EPA later issued an “amended” NOV, and sued under the amended NOV, without ensuring that the tolling agreement was amended to cover the new NOV as well.

Not a good day for EPA.