In early January, a Ninth Circuit panel significantly amended its prior decision in California Restaurant Association v. City of Berkley; at the same time, the full court denied en banc review. Besides being a consequential case for energy policy, the amended opinion affords insight into how the en banc process shapes the law of the circuit.
In 2019, the City of Berkley enacted an ordinance banning natural gas infrastructure in newly constructed buildings. The California Restaurant Association (“the Association”) challenged the ordinance in federal district court, claiming that the measure is expressly preempted by the Energy Policy and Conservation Act (“EPCA”), which prohibits any local rule “concerning the . . . energy use . . . of” products subjection to regulation under the act. The Association argued that the ordinance, by effectively prohibiting the use of EPCA-regulated appliances, is a regulation that “concerns” these appliances’ “energy use” and is, therefore, preempted.
The municipality moved to dismiss, arguing that the statute’s preemption extends only to regulations on the design and manufacture of appliances, rather than regulations that impact the availability of energy sources like natural gas. The district court granted the motion with respect to the preemption claim, and the Association appealed. See Cal. Rest. Ass’n v. City of Berkeley, 547 F. Supp. 3d 878, 891 (N.D. Cal. 2021).
Last April, a three-judge panel reversed. See 65 F. 4th 1045 (CA9 2023). Interpreting EPCA’s preemption provision “expansively,” Judge Patrick Bumatay’s opinion held that “States and localities can’t skirt the text of broad preemption provisions by doing indirectly what Congress says they can’t do directly.”
Judge Diarmuid O’Scannlain filed a concurring opinion, in which he second-guessed the law of the circuit that compelled his decisionmaking. Not long ago, Judge O’Scannlain explained, the Ninth Circuit construed statutory preemption narrowly, in accordance with a presumption against express preemption that had been established by the Supreme Court. In 2016, however, the court seemed to abandon this presumption, without addressing its prior precedents to the contrary. See Puerto Rico v. Franklin Cal. Tax-Free Tr., 579 U.S. 115 (2016). Judge O’Scannlain bemoaned the court’s “drive by ruling” and further questioned the Ninth Circuit’s interpretation of the court’s apparent pivot. Noting a circuit split on the matter, he suggested that the Ninth Circuit went too far when it swept away its anti-preemption presumption in all contexts.
Judge M. Miller Baker, sitting by designation from the Court of International Trade, filed another concurring opinion, in which he expressed his doubts about the law of the circuit regarding associational standing, such as that claimed by the Association. On this issue, Judge Baker observed a circuit split.
Berkley petitioned for en banc review. Multiple parties filed amicus briefs in support of the petition, including the federal government.
On January 2, 2024, the full court denied the petition. Judge Michelle Friedland authored a dissent to the denial of en banc rehearing, joined by seven other sitting judges (Judges Murguia, Wardlaw, Gould, Koh, Sung, Sanchez, and Mendoza). In addition, three senior judges filed a statement respecting the denial of en banc, in which they simply incorporated Judge Friedland’s opinion by reference (Judges Berzon, Paez, and Fletcher).
Judge Friedland began her opinion by noting she had never written or joined a dissent from a denial of a rehearing en banc, but she now “fe[lt] compelled to do so now to urge any future court that interprets the [EPCA] not to repeat the panel opinion’s mistakes.” With respect to statutory analysis, the dissent faulted the majority for giving the EPCA’s preemption provision “colloquial” constructions “instead of the technical meanings required by established canons of statutory interpretation.” Interestingly, the dissent’s statutory argument seemingly relies on an amicus submitted by a group of states, rather than the petitioner’s brief (which had argued that the panel’s decision conflicted with Ninth Circuit precedent). Judge Friedland warned that the panel’s “errors . . . have important consequences” because they threatened to “stifle” local climate change policies.
Concomitantly, Judge Bumatay made several substantial amendments to the original opinion, with the clear intent of narrowing its effect. See, e.g., slip op. at p18 (adding that “although EPCA’s preemption provision is broad, it is not unlimited” in that it “has nothing to say about a State or local government regulation of a utility’s distribution of natural gas”); id. at 23 (adding the sentence: “This is a narrow opinion about Berkeley’s building codes.”). Evidently, Judge Bumatay muted the decision to mollify a critical mass of sitting judges and thereby avoid consideration by the full court.
In a way that is peculiar to the Ninth Circuit, the case’s disposition defies an easy explanation. Two of the three judges on the panel voiced reservations about the decision, while eleven other judges (eight sitting and three senior) dissented. As against these thirteen dissenting or skeptical judges, only one (Bumatay) unreservedly signed onto the opinion (which he wrote). Despite this gross asymmetry, the decision was not reviewed by the full court, and is now the law of the circuit.
