Court of Appeals Revisits its Ruling on EPA’s “Sham Recycling” Rule

In a per curiam decision filed March 6, 2018, the Court of Appeals for the District of Columbia Circuit amended its decision from July 2017 regarding EPA’s Definition of Solid Waste rule, which was finalized in 2008, and revised in 2015. The Court’s 2017 decision upheld some aspects of the rule, but overturned other aspects. After additional briefing, the Court amended its 2017 decision in three ways: (1) it severed and affirmed EPA’s removal of the spent catalyst bar from the vacated portions of the “Verified Recycler Exclusion”; (2) vacated Factor 4 in its entirety; and (3) clarified the rules that replace the now-vacated Factor 4.

Spent catalyst bars were excluded from regulation as a solid waste under the 2015. However, the Court vacated that exclusion, and reinstated the Transfer-Based Exclusion from the initial 2008 rule, and stated that spent catalyst would be disqualified from the solid waste exclusion, as it was under the 2008 rule. In this amended opinion, the Court determined that EPA removed the disqualification for spent catalyst because it relied in part on the Verified Recycler Exclusion, and EPA considered the revised standard of “contained” to address the risks from spent catalysts. The Court also noted that the contained standard that applies to both the Generator-Controlled Exclusion and the now-revived Transfer-Based Exclusion.

In the 2017 decision, the Court limited its application of the Factor 4 vacatur to “all hazardous secondary materials via § 261.2(g).” In the amended opinion, the Court found that the petitioners had challenged the Factor 4 in its entirety, and therefore vacated Factor 4 in its entirety, including where it is expressly incorporated into an exclusion. Although the Court vacated Factor 4 entirely, it kept in place the remaining legitimacy factors. Therefore, Factor 3 remains mandatory per the 2015 changes, and the 2008 version of Factor 4 replaces the 2015 version of Factor 4.


American Petroleum Institute v. EPA, No. 09-1038 (D.C. Cir. March 6, 2018)