Diamond Alternative Energy, LLC v. Environmental Protection Agency, 606 U.S. ___ (2025)
The Environmental Protection Agency (EPA) approved California regulations under the Clean Air Act that require automakers to produce more electric vehicles and fewer gasoline-powered vehicles to reduce emissions. Several fuel producers, including those of gasoline and ethanol, sued the EPA, arguing that the EPA lacked the authority to approve these regulations as they target global climate change rather than local air quality issues. The fuel producers claimed that the regulations would significantly reduce the demand for liquid fuels, causing them monetary injury.
The United States Court of Appeals for the District of Columbia Circuit reviewed the case and held that the fuel producers lacked Article III standing. The court found that the fuel producers failed to demonstrate that automakers would likely respond to the invalidation of the regulations by producing fewer electric vehicles and more gasoline-powered vehicles, thus failing to establish redressability.
The Supreme Court of the United States reviewed the case and held that the fuel producers have Article III standing to challenge the EPA’s approval of the California regulations. The Court found that the fuel producers demonstrated injury in fact, causation, and redressability. The Court reasoned that the regulations likely cause monetary injury to the fuel producers by reducing the demand for gasoline and other liquid fuels. The Court also found that invalidating the regulations would likely redress the injury by increasing the sales of gasoline-powered vehicles and, consequently, the demand for liquid fuels. The judgment of the Court of Appeals was reversed and the case was remanded for further proceedings.
Fuel producers had standing to sue the EPA for approving California regulations that required automakers to manufacture more electric vehicles and fewer gasoline-powered vehicles.
SUPREME COURT OF THE UNITED STATES
Syllabus
DIAMOND ALTERNATIVE ENERGY, LLC, et al. v. ENVIRONMENTAL PROTECTION AGENCY et al.
certiorari to the united states court of appeals for the district of columbia circuit
No. 24–7. Argued April 23, 2025—Decided June 20, 2025
Under the Clean Air Act, the Environmental Protection Agency (EPA) approved California regulations that require automakers to manufacture more electric vehicles and fewer gasoline-powered vehicles with a goal of decreasing emissions from liquid fuels. The regulations require automakers to limit average greenhouse-gas emissions across their vehicle fleets and manufacture a certain percentage of electric vehicles. Several producers of fuels such as gasoline and ethanol sued EPA in the D. C. Circuit, arguing that EPA lacked authority to approve the California regulations because they target global climate change rather than local California air quality problems as required by the Clean Air Act. They submitted standing declarations explaining that California’s regulations depress demand for liquid fuel by requiring vehicles that use less or no liquid fuel, causing the fuel producers monetary injury. California’s own estimates indicated the regulations would cause substantial reductions in demand for gasoline exceeding $1 billion beginning in 2020 and increasing to over $10 billion in 2030.
EPA did not challenge the fuel producers’ standing in the D. C. Circuit. California, as well as other States adopting California’s regulations, intervened to defend EPA’s approval. California argued that the fuel producers lacked standing because automobile manufacturers would not change course if EPA’s decision were vacated given the “surging consumer demand” for electric vehicles. The D. C. Circuit held that the fuel producers lacked Article III standing, finding they failed to establish that automakers would likely respond to invalidation of the regulations by producing fewer electric vehicles and more gasoline-powered vehicles.
Held: The fuel producers have Article III standing to challenge EPA’s approval of the California regulations. Pp. 7–22.
(a) Article III limits federal court jurisdiction to “Cases” and “Controversies,” requiring plaintiffs to demonstrate standing by showing three elements: injury in fact, causation, and redressability. Injury in fact requires a “ ‘concrete,’ ” “particularized” injury that is “actual or imminent.” FDA v. Alliance for Hippocratic Medicine, 602 U.S. 367, 381. Causation requires showing “the injury was likely caused by the defendant.” TransUnion LLC v. Ramirez, 594 U.S. 413, 423. Redressability requires demonstrating that judicial relief would likely redress the injury. Ibid. When a plaintiff is not the direct object of government regulation, causation and redressability often depend on how third parties not before the court will predictably respond to the regulation or judicial relief. Pp. 7–10.
(b) The fuel producers’ injury in fact and causation are straightforward and undisputed. The fuel producers make money by selling fuel, so decreased purchases of gasoline and other liquid fuels resulting from California’s regulations constitute monetary injury. EPA’s approval authorized California and 17 other States to enforce regulations requiring lower emissions and vehicle electrification, thereby reducing liquid fuel purchases. The regulations likely cause the fuel producers’ monetary injuries because reducing gasoline and diesel fuel consumption is the whole point of the regulations.
The fuel producers also satisfy redressability. Even minimal additional revenue would satisfy this requirement, and invalidating the regulations would likely result in more revenue from additional fuel sales based on commonsense economic principles and record evidence. Pp. 11–22.
(1) The fuel producers might be considered direct objects of the California regulations because the regulations explicitly seek to restrict gasoline and other liquid fuel use in automobiles. When the government prohibits or impedes one company from using another company’s product or service, both companies might be deemed objects of the regulation. See, e.g., Pierce v. Society of Sisters, 268 U.S. 510, 535–536; Columbia Broadcasting System, Inc. v. United States, 316 U.S. 407, 422. The Court need not resolve this question because the record evidence in this case establishes the fuel producers’ standing in any event. Pp. 12–13.
(2) This case presents the “familiar” circumstance where government regulation of one business “may be likely” to cause injuries to other linked businesses. Alliance for Hippocratic Medicine, 602 U. S., at 384. California’s regulations force automakers to manufacture more electric vehicles and fewer gasoline-powered vehicles, likely causing downstream economic injuries to fuel producers. Invalidating these regulations would likely mean more gasoline-powered automobiles and more fuel sales.
EPA and California argue this case is unusual because the vehicle market has developed such that automakers would not manufacture more gasoline-powered cars even if regulations were invalidated. This argument is undermined by their own actions—if invalidating the regulations would change nothing, why are they enforcing and defending them? The whole point of the regulations is to increase electric vehicles beyond what consumers would otherwise demand and manufacturers would otherwise produce.
Record evidence confirms that invalidating the regulations would likely redress the fuel producers’ monetary injury. First, the fuel producers’ declarations quote California’s own estimates of substantial reductions in gasoline demand and note California’s recognition that fuel providers would be “most adversely affected.” App. 137. Second, California stated in 2021 that the regulations are “critical” for future emissions reductions and submitted expert declarations in 2022 stating that without the regulations, fewer electric vehicles would be sold and more gasoline-fueled vehicles would be sold. Id., at 66, 115. Third, EPA affirmed that California “needs” its standards and credited California’s estimates that the regulations would continue reducing emissions through at least 2037. 87 Fed. Reg. 14334; 89 Fed. Reg. 82558. Fourth, five automakers who invested heavily in electric vehicles intervened to defend the regulations and predicted that without California’s regulations, other automakers would seek a competitive advantage by selling fewer electric vehicles and more gasoline-powered vehicles. Pp. 13–18.
(3) EPA and California argue the fuel producers needed more evidence, such as affidavits from expert economists or directly regulated automakers. This Court has not demanded such evidence to show how third parties would likely respond to government regulations. Plaintiffs must simply “show a predictable chain of events” that would likely result from judicial relief. Alliance for Hippocratic Medicine, 602 U. S., at 385. Requiring affidavits from regulated third parties would make standing dependent on whether the plaintiff and third parties share litigation interests and whether third parties are willing to publicly oppose the government regulator. Such a heightened requirement would close the courthouse doors to many traditional challenges to agency action. Pp. 18–19.
(4) This case does not involve the rare instance where a market has likely permanently changed such that invalidating a challenged regulation would have no effect on that market. Such instances are rare for two reasons. First, governments do not usually continue enforcing and defending regulations that have no continuing effect. Second, the effect of regulations like these depend on interrelated economic forces that change over time, so courts should be wary of claims that invalidating important regulations would have zero impact on dynamic, heavily regulated markets. The evidence that some automakers are in compliance with California’s mandates suggests regulatory effect, not absence of effect, and does not demonstrate how all automakers would respond to invalidation. Pp. 19–22.
98 F. 4th 288, reversed and remanded.
Kavanaugh, J., delivered the opinion of the Court, in which Roberts, C. J., and Thomas, Alito, Kagan, Gorsuch, and Barrett, JJ., joined. Sotomayor, J., and Jackson, J., filed dissenting opinions.
Judgment REVERSED and case REMANDED Kavanaugh, J., delivered the opinion of the Court, in which Roberts, C. J., and Thomas, Alito, Kagan, Gorsuch, and Barrett, JJ., joined. Sotomayor, J., and Jackson, J., filed dissenting opinions. |
Judgment REVERSED and case REMANDED. Kavanaugh, J., delivered the opinion of the Court, in which Roberts, C. J., and Thomas, Alito, Kagan, Gorsuch, and Barrett, JJ., joined. Sotomayor, J., and Jackson, J., filed dissenting opinions. |
Argued. For petitioners: Jeffrey B. Wall, Washington, D. C. For federal respondents: Edwin S. Kneedler, Deputy Solicitor General, Department of Justice, Washington, D. C. For state respondents: Joshua A. Klein, Deputy Solicitor General, Oakland, Cal. |
Reply of Diamond Alternative Energy, LLC, et al. submitted. |
Reply of petitioners Diamond Alternative Energy, LLC, et al. filed. (Distributed) |
Reply of Diamond Alternative Energy, LLC, et al. submitted. |
Reply of petitioners Diamond Alternative Energy, LLC, et al. filed. (Distributed) |
Motion for divided argument filed by the Acting Solicitor General GRANTED. |
CIRCULATED |
Amicus brief of International Council on Clean Transportation and the University of California, Davis Institute of Transportation Studies submitted. |
Motion of Federal Respondents for divided argument submitted. |
Motion for divided argument filed by the Acting Solicitor General. |
Amicus brief of Professors Heather Elliott and Jonathan Nash submitted. |
Brief amici curiae of Professor Heather Elliott, et al. filed. (Distributed) |
Brief amici curiae of International Council on Clean Transportation, et al. filed. (Distributed) |
Brief amici curiae of International Council on Clean Transportation, et al. filed. (Distributed) |
Brief amici curiae of Professor Heather Elliott, et al. filed. (Distributed) |
Motion for divided argument filed by the Acting Solicitor General. |
Brief amicus curiae of Professor F. Andrew Hessick filed. (Distributed) |
Amicus brief of Professor F. Andrew Hessick submitted. |
Brief amicus curiae of Professor F. Andrew Hessick filed. (Distributed) |
Letter of respondents Natural Resources Defense Council, et al. (the public interest organizations) notifying the Clerk they do not intend to file a brief on the merits filed. |
Letter from Respondents of Natural Resources Defense Council, Inc. submitted. |
Brief of State Respondents filed. |
Brief of federal respondents filed. |
Brief of state respondents filed. |
Letter of respondents Natural Resources Defense Council, et al. (the public interest organizations) notifying the Clerk they do not intend to file a brief on the merits filed. |
Record received electronically from the United States Court of Appeals for the District of Columbia Circuit and available with the Clerk. |
Brief of respondents Federal Respondents filed. |
Letter from Respondents of the public interest organizations submitted. |
Brief of respondents State Respondents filed. |
Brief of Federal Respondents filed. |
Brief of State Respondents submitted. |
Record requested from the United States Court of Appeals for the District of Columbia Circuit. |
SET FOR ARGUMENT on Wednesday, April 23, 2025. |
Motion of respondents to extend the time to file respondents' briefs on the merits granted and the time is extended to and including March 12, 2025. |
Motion of respondents for an extension of time within which to file respondents' briefs on the merits filed. |
Motion of respondents for an extension of time within which to file respondents' briefs on the merits filed. |
Motion of Federal Respondents for an extension of time submitted. |
Motion of the federal respondents to hold the briefing schedule in abeyance DENIED. |
Brief amicus curiae of Cato Institute filed. |
Brief amici curiae of Our Children’s Trust, et al. in support of neither party filed. |
Brief amici curiae of Advancing American Freedom, et al. filed. |
Brief amici curiae of Texas Oil & Gas Association, et al. filed. |
Brief amici curiae of Western States Petroleum Association, et al. filed. |
Brief amici curiae of Texas Royalty Council, et al. filed. |
Brief amici curiae of Texas Royalty Council, et al. filed. |
Brief amici curiae of Texas Oil & Gas Association, et al. filed. |
Brief amici curiae of Chamber of Commerce of the United States of America, et al. filed. |
Brief amicus curiae of Cato Institute filed. |
Brief amici curiae of Chamber of Commerce of the United States of America, et al. filed. |
Brief amici curiae of Brief of Western States Petroleum Association, et al. filed. |
Amicus brief of Texas Royalty Council and American Royalty Council submitted. |
Amicus brief of The Sulphur Institute submitted. |
Amicus brief of Brief of Western States Petroleum Association, National Federation of Independent Business, Inc., California Asphalt Pavement Association, Washington Oil Marketers Association, California Fuels & Convenience Alliance, Arizona Petroleum Marketers Association, Energy and Convenience Association of Nevada, Oregon Fuels Association, And American Trucking Associations, Inc. submitted. |
Amicus brief of American Petroleum Institute submitted. |
Amicus brief of Cato Institute submitted. |
Amicus brief of Texas Oil & Gas Association, Louisiana Mid-Continent Oil & Gas Association, The Petroleum Alliance Of Oklahoma, Texas Independent Producers And Royalty Owners Association, And Texas Association Of Manufacturers submitted. |
Amicus brief of Our Children’s Trust and Public Justice submitted. |
Amicus brief of Advancing American Freedom submitted. |
Brief amici curiae of Advancing American Freedom et al. filed. |
Brief amici curiae of Our Children’s Trust and Public Justice in support of neither party filed. |
Brief amicus curiae of The Sulphur Institute filed. |
Brief amicus curiae of ConservAmerica filed. |
Amicus brief of ConservAmerica submitted. |
Amicus brief of Chamber of Commerce of the United States of America, American Automotive Leasing Association, American Car Rental Association, Associated General Contractors of America, Inc., and Truck Renting and Leasing Association submitted. |
Brief amicus curiae of The Two Hundred for Homeownership filed. |
Brief amicus curiae of American Petroleum Institute filed. |
Brief amicus curiae of ConservAmerica filed. |
Brief amicus curiae of The Two Hundred for Homeownership filed. |
Brief amici curiae of Western States Petroleum Association, et al. filed. |
Brief amicus curiae of American Petroleum Institute filed. |
Brief amicus curiae of The Sulphur Institute filed. |
Brief amici curiae of Our Children’s Trust, et al. in support of neither party filed. |
Brief amici curiae of Advancing American Freedom, et al. filed. |
Amicus brief of Foothill Church and Cedar Park Assembly of God of Kirkland, Washington submitted. |
Brief amici curiae of Foothill Church and Cedar Park Assembly of God of Kirkland, Washington filed. |
Brief amici curiae of Foothill Church and Cedar Park Assembly of God of Kirkland, Washington filed. |
Response in opposition to motion to hold the briefing schedule in abeyance from petitioners Diamond Alternative Energy, LLC, et al. filed. (Distributed) |
Response of Diamond Alternative Energy, LLC, et al. to motion submitted. |
Response in opposition to motion to hold the briefing schedule in abeyance from petitioners Diamond Alternative Energy, LLC, et al. filed. (Distributed) |
Joint Appendix submitted. |
Brief of Diamond Alternative Energy, LLC, et al. submitted. |
Brief of petitioners Diamond Alternative Energy, LLC, et al. filed. |
Joint appendix filed. |
Joint appendix filed. |
Brief of petitioners Diamond Alternative Energy, LLC, et al. filed. |
Joint appendix filed. |
Motion of the Federal Respondents to Hold the Briefing Schedule in Abeyance of Federal Respondents submitted. |
Motion to hold the briefing schedule in abeyance filed by federal respondents. (Distributed) |
Motion to hold the briefing schedule in abeyance filed by federal respondents. (Distributed) |
Motion to hold the briefing schedule in abeyance filed by federal respondents. |
Petition GRANTED limited to Question 1 presented by the petition. |
DISTRIBUTED for Conference of 12/13/2024. |
DISTRIBUTED for Conference of 12/6/2024. |
DISTRIBUTED for Conference of 11/22/2024. |
DISTRIBUTED for Conference of 11/15/2024. |
DISTRIBUTED for Conference of 11/8/2024. |
Letter of October 29, 2024, of California et al., in response filed. (Distributed) |
Letter of October 29, 2024, of California et al., in response filed. (Distributed) |
DISTRIBUTED for Conference of 11/1/2024. |
Letter of October 23, 2024 from counsel for petitioners filed. (Distributed) |
Letter of October 23, 2024 from counsel for petitioners filed. (Distributed) |
DISTRIBUTED for Conference of 10/18/2024. |
DISTRIBUTED for Conference of 10/11/2024. |
Reply of petitioners Diamond Alternative Energy, LLC, et al. filed. (Distributed) |
Reply of petitioners Diamond Alternative Energy, LLC, et al. filed. (Distributed) |
Brief of State Respondents in opposition filed. VIDED. |
Brief of Federal Respondents in opposition filed. |
Brief of State Respondents in opposition filed. VIDED. |
Waiver of right of respondents Natural Resources Defense Council, Inc., et al. to respond filed. |
Brief of Federal Respondents in opposition filed. |
Waiver of right of respondents Natural Resources Defense Council, Inc., et al. to respond filed. |
Brief amicus curiae of The Two Hundred for Homeownership filed. |
Brief amici curiae of Advancing American Freedom, et al. filed. |
Brief amicus curiae of Competitive Enterprise Institute filed. |
Brief amici curiae of Western States Petroleum Association, et al. filed. |
Brief amici curiae of Chamber of Commerce of the United States of America, et al. filed. |
Brief amici curiae of Western States Petroleum Association, et al. filed. |
Brief amici curiae of Specialty Equipment Market Association, et al. filed. VIDED |
Brief amicus curiae of ConservAmerica filed. |
Brief amici curiae of Texas Oil & Gas Association, et al. filed. |
Brief amicus curiae of American Petroleum Institute filed. |
Brief amicus curiae of Competitive Enterprise Institute filed. |
Brief amici curiae of Texas Royalty Council, et al. filed. |
Brief amicus curiae of The Sulphur Institute filed. |
Brief amici curiae of California Business Roundtable, et al. filed. |
Brief amici curiae of California Business Roundtable, et al. filed. |
Brief amici curiae of Texas Royalty Council, et al. filed. |
Brief amicus curiae of ConservAmerica filed. |
Brief amicus curiae of American Petroleum Institute filed. |
Brief amici curiae of Texas Oil & Gas Association, et al. filed. |
Brief amici curiae of Specialty Equipment Market Association, et al. filed. VIDED |
Brief amicus curiae of The Sulphur Institute filed. |
Brief amicus curiae of The Two Hundred for Homeownership filed. |
Brief amici curiae of Advancing American Freedom, et al. filed. |
Brief amici curiae of Chamber of Commerce of the United States of America, et al. filed. |
Brief amici curiae of Organizations Committed to Constitutional Government filed. VIDED. |
Brief amici curiae of Organizations Committed to Constitutional Government filed. VIDED. |
Motion to extend the time to file a response is granted. The time to file responses has been extended to and including September 9, 2024, for all respondents. |
Motion of the Solictor General to extend the time to file a response from August 7, 2024 to September 6, 2024, submitted to The Clerk. |
Motion of the Solictor General to extend the time to file a response from August 7, 2024 to September 6, 2024, submitted to The Clerk. |
Motion to extend the time to file a response is granted and the time is extended to and including September 9, 2024, for all respondents. |
Motion to extend the time to file a response from August 7, 2024 to September 7, 2024, submitted to The Clerk. |
Motion to extend the time to file a response from August 7, 2024 to September 7, 2024, submitted to The Clerk. |
Petition for a writ of certiorari filed. (Response due August 7, 2024) |
Petition for a writ of certiorari filed. (Response due August 7, 2024) |