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Engine Manufacturers Association v. California Air Resources Board

California Court of Appeals, Third District, Sacramento

November 24, 2014

STATE AIR RESOURCES BOARD, Defendant and Appellant.

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APPEAL from a judgment of the Superior Court of Sacramento County No. 34201000082774CUMCGDS, Shelleyanne W.L. Chang, Judge.


Kamala D. Harris, Attorney General, Robert W. Byrne, Assistant Attorney General and Nicholas Stern, Deputy Attorney General for Defendant and Appellant.

Chicago Law Partners, Timothy A. French; Greenberg Traurig, James M. Mattesich and Nancy J. Doig for Plaintiff and Respondent.



Engine Manufacturers Association (EMA) challenges certain regulations adopted by the State Air Resources Board (CARB) requiring engine manufacturers to obtain a sample of emissions of in-use heavy-duty engines equipped with on-board diagnostic (OBD) systems that are nearing the end of their certified useful life and conduct a series of tests on these engines “to assure that engines certified for sale in California are equipped with OBD systems that properly function....” (Cal. Code Regs., tit. 13, § 1971.5, subd. (a)(2); see id., subds. (a)(1), (c).) The challenged regulations also contain provisions requiring CARB to order the recall and repair of all engines that have been determined to be equipped with a non-conforming OBD system where certain conditions exist. (Id., subd. (d)(3).) EMA’s operative complaint sought a judicial declaration that the challenged regulations, which will be described in greater detail in the background portion of this opinion, are in excess of CARB’s statutory authority and therefore invalid. The trial court granted EMA’s motion for judgment on the pleadings and declared the challenged regulations invalid. CARB appeals.

We reverse. As we explain, the Legislature has granted CARB broad authority to adopt regulations designed to reduce air pollution caused by motor vehicle emissions as expeditiously as possible, subject to cost-effectiveness and feasibility limitations. (See Health & Saf. Code, §§ 39601, 43013, 43018.)[1] While CARB “has no power to vary or enlarge the terms of an enabling statute, ” and may not “issue regulations which conflict with [an enabling statute] or any other statute[, ] [citation] ... the absence of any specific provisions regarding [manufacturer testing of in-use heavy-duty

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engines equipped with OBD systems and mandatory recall of engines determined to be equipped with a non-conforming OBD system] does not mean that such... regulation[s] exceed[] statutory authority; in our view, it indicates only that the Legislature did not itself desire to determine the proper [method of regulating such systems]. [Citations.] Courts have long recognized that the Legislature may elect to defer to and rely upon the expertise of administrative agencies. [Citations.]” (Credit Ins. Gen. Agents Assn. v. Payne (1976) 16 Cal.3d 651, 656 [128 Cal.Rptr. 881, 547 P.2d 993] (Payne).) We conclude the challenged regulations fall within the scope of authority conferred by the Legislature unless manufacturer in-use testing of OBD systems on heavy-duty engines is prohibitively costly. However, the question of prohibitive cost cannot be settled on the pleadings. The remaining question, whether the regulations are reasonably necessary to effectuate the statutory purpose, was not properly raised in EMA’s motion for judgment on the pleadings. Nor does EMA advance an argument regarding the issue on appeal. We therefore reverse and remand the matter to the trial court with directions to deny EMA’s motion for judgment on the pleadings.


CARB “is the state agency charged with coordinating efforts to attain and maintain ambient air quality standards, to conduct research into the causes of and solution to air pollution, and to systematically attack the serious problem caused by motor vehicles, which is the major source of air pollution in many areas of the state.” (§ 39003.) EMA is a not-for-profit trade association representing manufacturers of engines used in heavy-duty motor vehicles, including the engines covered by the challenged regulations.

On-Board Diagnostic Systems

CARB requires most engines in vehicles certified for sale in California to be equipped with an OBD system. (Cal. Code Regs., tit. 13, §§ 1968.2, subd. (b) [applies to 2004 and subsequent model-year passenger cars, light-duty trucks, and medium-duty vehicles and engines], 1971.1, subd. (b) [applies to 2010 and subsequent model-year heavy-duty engines].) These OBD systems, “through the use of an onboard computer(s), shall monitor emission systems in-use for the actual life of the engine and shall be capable of detecting malfunctions of the monitored emission systems, illuminating a malfunction indicator light (MIL) to notify the vehicle operator of detected malfunctions, and storing fault codes identifying the detected malfunctions.” (Id., § 1971.1, subd. (a); see id., § 1968.2, subd. (a).) The declared purpose of requiring such systems is to “ensure reductions in in-use motor vehicle and motor vehicle engine emissions through improvements of emission system durability and performance.” (Id., § 1971.1, subd. (a).) EMA does not challenge this requirement.

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Pre-Certification Testing of OBD Systems

Before manufacturers are permitted to sell new motor vehicles or new motor vehicle engines, CARB must certify that the vehicle or engine meets emission standards. (§ 43102, subd. (a).) Section 43101 requires CARB to adopt and implement such standards, subject to the requirement that they be “necessary and technologically feasible to carry out the purposes of [Division 26 of the Health and Safety Code].” (§ 43101, subd. (a).) Section 43104 requires CARB to “adopt, by regulation, test procedures and any other procedures necessary to determine whether the vehicles or engines are in compliance with the emissions standards established pursuant to Section 43101, ” and further provides such procedures shall be based on “federal test procedures or on driving patterns typical in the urban areas of California.”

Light-duty vehicles are tested for emission compliance on a chassis dynamometer, a platform with large steel rollers on which the vehicle can be operated at prescribed speeds for prescribed periods of time. Vehicle emissions are measured and compared against the applicable emission standards. Heavy-duty vehicle engines are typically tested for emission compliance outside their intended vehicle on an engine dynamometer, a machine that can cause the engine to operate at prescribed speeds and under prescribed loads for long or short periods of time to generate an operating cycle that is representative of how the engine might operate in a heavy-duty vehicle driving on California roads. Equipment attached to the engine measures and compares the emissions generated against applicable standards.

As part of the certification process, manufacturers of heavy-duty vehicle engines must demonstrate that the engine’s OBD system will function properly for the " '[a]ctual life” of the engine, i.e., “the entire period that an engine is operated on public roads in California up to the time an engine is retired from use.” (Cal. Code Regs., tit. 13, § 1971.1, subd. (c); see id., subd. (d)(1.3).) This can be as much as 435,000 miles for the heaviest vehicles. In order to demonstrate the performance and durability of the OBD system, manufacturers put a certain number of test engines through an “accelerated aging process” on an engine dynamometer and then test the OBD system’s ability to detect various malfunctions by replacing each of the engine’s major emission controls, one at a time, with malfunctioning emission controls. (Id., subd. (i)(2); see id., (3).) If the engine’s OBD system illuminates a malfunction indicator light (MIL) "prior to emissions exceeding the applicable emission threshold malfunction criteria” specified in the regulation, the OBD system has passed the test and “no further demonstration is required.” (Id., subd. (i)(5.1.2).) EMA does not challenge these pre-certification testing requirements.

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The Challenged Regulations

The challenged regulations require heavy-duty engine manufacturers to verify OBD system performance by duplicating the pre-certification testing on a sample of in-use production engines, starting with the 2010 model year. (Cal. Code Regs., tit. 13, §§ 1971.1, subd. (l)(4), 1971.5, subd. (c)(3)(C).) In selecting engines to be included in the test sample group, manufacturers are required to use only engines that, among other things, are “certified to the requirements of title 13 [of the California Code of Regulations], section 1971.1” and have “mileage that is between 70 to 80 percent of the certified full useful life mileage and an age of less than the certified full useful life age for the subject engines.” (Id., § 1971.5, subd. (c)(2)(C)(i).) The number of engines to be tested depends on the model year and the number of engine families certified by the manufacturer in that model year.[2] For example, “[f]or the 2013 and subsequent model years, a manufacturer certifying one to five engine families in a model year shall provide emission test data of a test engine from one engine rating.[3] A manufacturer certifying six to ten engine families in a model year shall provide emission test data from test engines from two engine ratings. A manufacturer certifying eleven or more engine families in a model year shall provide emission test data of test engines from three engine ratings." (Cal. Code Regs., tit. 13, § 1971.5, subd. (c)(2)(B)(ii).) Testing must be completed “[w]ithin three calendar years after the model year of the engine (e.g., by the end of calendar year 2013 for a 2010 model year engine).” (Id., subd. (c)(3)(A).)

As with the pre-certification testing, if the OBD system properly illuminates an MIL prior to emissions exceeding the applicable emission threshold malfunction criteria, “no further testing is required.” (Cal. Code Regs., tit. 13, § 1971.5, subd. (c)(4)(A).) If, however, the OBD system does not illuminate an MIL for one or more monitors before emissions exceed the malfunction criteria, “the engine manufacturer shall conduct further testing on additional engines.” (Id., subd. (c)(4)(B).) Specifically, within six months after the completion of the failed test, the engine manufacturer shall test an additional four engines from the same engine rating and engine family as the failed test engine, but shall be required to test only the monitors for which the OBD system did not illuminate ...

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