Court Overturns EPA’s Navistar Engine Penalty Rule

A federal appeals court has thrown out an Environmental Protection Agency rule that allowed Navistar Inc. to pay penalties while it continued to sell engines that did not meet 2010 federal emissions standards.

The ruling that was handed down Dec. 11 by the U.S. Court of Appeals for the District of Columbia Circuit does not affect the truck maker because Navistar has adopted the required emissions technology.

Petitioners in the case were competitors Daimler Trucks North America and Volvo Group, which had argued before the court Oct. 22 that EPA should not have allowed Navistar to use the “nonconformance penalties.”

Navistar should have employed emissions technology that complied with the government’s standards, the attorneys said.

The court said it was vacating EPA’s rule that allowed for the penalties “because the court typically vacates rules when an agency ‘entirely fails’ to provide notice and comment . . . and especially in light of EPA’s counsel’s statement during oral arguments” that vacating the rule would not cause “any harm because it has become clear that Navistar Inc.’s engines will be in compliance” with the standard for nitrogen oxide compounds by the start of 2014.