Diamond Alternative Energy, LLC, et al. v. Environmental Protection Agency et al.
No. 24-7 · Decided June 20, 2025 · reversed and remanded
Whether fuel producers have Article III standing to challenge the Environmental Protection Agency's approval of California regulations requiring automakers to manufacture more electric vehicles and fewer gasoline-powered vehicles. The fuel producers have Article III standing to challenge the EPA's approval of California's vehicle emissions regulations.
CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT · Argued April 23, 2025
Parties — Petitioner: DIAMOND ALTERNATIVE ENERGY, LLC, et al. · Respondent: ENVIRONMENTAL PROTECTION AGENCY et al.
Vote & lineup7–2 on the judgment. Kavanaugh delivered the opinion of the Court, joined by Roberts, Thomas, Alito, Kagan, Gorsuch, Barrett (7). Dissent(s): Sotomayor, Jackson.
Who prevailed — The petitioners prevailed on the issue of standing, and the case was remanded to the D.C. Circuit for consideration of the merits.
The question

Whether fuel producers have Article III standing to challenge the Environmental Protection Agency's approval of California regulations requiring automakers to manufacture more electric vehicles and fewer gasoline-powered vehicles. The central issue is whether judicial invalidation of these regulations would likely redress the monetary injuries suffered by the fuel producers. This requires determining if the fuel producers demonstrated a predictable chain of events showing that removing the regulations would increase demand for liquid fuels.

Petitioner's argument
  • The California regulations reduce the manufacture and sale of gasoline-powered cars, causing a decrease in sales and revenue for fuel producers.
  • Invalidating the regulations would remove a regulatory impediment to their ability to compete in the market.
  • Without these regulations, manufacturers would likely produce more gasoline-powered vehicles, thereby increasing purchases of liquid fuels.
  • Because the government is targeting the use of fuel by regulating at the assembly line rather than the gas pump, fuel producers are effectively objects of the regulation and should have standing without extensive additional analysis.
Respondent's argument
  • Fuel producers lack Article III standing because they failed to establish a probability that automakers would change their production course if the regulations were vacated.
  • Surging consumer demand for electric vehicles means manufacturers would continue producing them regardless of whether the regulations remain in effect.
  • The fuel producers failed to provide sufficient evidence, such as affidavits from expert economists or regulated automakers, to prove redressability.
  • The automobile market has changed permanently such that invalidating the challenged regulation would have no actual effect on the market.
The decision
  • The Court held that fuel producers possess Article III standing, which requires a showing of injury in fact, causation, and redressability per *Lujan v. Defenders of Wildlife*.
  • Injury in fact is established because the decrease in purchases of liquid fuels constitutes monetary costs, which "are of course an injury" under *United States v. Texas*.
  • Causation is satisfied because EPA's approval authorized regulations specifically designed to reduce liquid fuel consumption by forcing vehicle electrification.
  • Redressability is met if judicial relief would likely result in even "one dollar" of additional revenue, as established in *Uzuegbunam v. Preczewski*.
  • Applying "commonsense economic principles," the Court reasoned that since the regulations were designed to increase electric vehicles beyond market demand, vacating them would likely reduce that effect and increase gasoline-powered vehicle sales.
  • The Court relied on record evidence, including California's own estimates of substantial reductions in gasoline demand and expert declarations stating that without the regulations, fewer electric vehicles and more gasoline-fueled vehicles would be sold.
  • The Court rejected the requirement for affidavits from third parties or experts, ruling that plaintiffs must simply "show a predictable chain of events" per *FDA v. Alliance for Hippocratic Medicine* and *Department of Commerce v. New York*.
  • The Court dismissed the argument that the market had permanently shifted, noting that governments typically do not defend regulations that have no continuing effect on dynamic markets.
Separate opinions
Sotomayor, dissenting
  • Argues the D.C. Circuit's decision was based on a factual misunderstanding regarding the duration of the regulations and should have been corrected via vacatur and remand rather than a full Court ruling on standing law.
Jackson, dissenting
  • Contends the case is likely moot because the administration will imminently withdraw the waiver.
  • Argues that the Court's lenient redressability analysis here contrasts with its stern approach in civil rights cases such as *Warth v. Seldin*, *Allen v. Wright*, and *Clapper v. Amnesty Int'l USA*.