Diamond Alternative Energy, LLC v. Environmental Protection Agency

In this case, the court considered this issue: Do the fuel producers have Article III standing to challenge the EPA's approval of California regulations that require automakers to manufacture more electric vehicles and fewer gasoline-powered vehicles?The case was decided on June 20, 2025.The Supreme Court held that fuel producers have Article III standing to challenge EPA’s approval of California regulations that require automakers to manufacture more electric vehicles and fewer gasoline-powered vehicles because invalidating the regulations would likely redress their monetary injuries from decreased fuel sales. Justice Brett Kavanaugh authored the 7-2 majority opinion of the Court.The California regulations force automakers to limit average greenhouse-gas emissions across their vehicle fleets and manufacture a certain percentage of electric vehicles, thereby reducing demand for gasoline and other liquid fuels. Article III standing requires showing injury in fact, causation, and redressability—meaning the plaintiff must demonstrate actual harm caused by the defendant that judicial relief would likely fix. When government regulation of one business predictably causes downstream economic injuries to linked businesses, commonsense economic principles support finding that invalidating the regulation would likely redress those injuries by removing the regulatory impediment to the injured party’s sales.Record evidence confirms that invalidating the regulations would likely redress the fuel producers’ injuries, including: California’s own estimates showing the regulations would cause substantial reductions in gasoline demand exceeding $10 billion by 2030; California’s statements that the regulations are “critical” for emissions reductions and that without them fewer electric vehicles would be sold; EPA's affirmation that California “needs” these standards; and five automakers’ intervention predicting that absent the regulations, competitors would sell fewer electric vehicles to gain market advantage. The Court rejected arguments that fuel producers needed expert affidavits or declarations from automakers to establish redressability, explaining that requiring such evidence would improperly make standing depend on alignment between plaintiffs and regulated third parties.Justice Sonia Sotomayor authored a dissenting opinion arguing that the Court should have vacated and remanded for the D.C. Circuit to reconsider based on corrected facts about when the regulations expire.Justice Ketanji Brown Jackson authored a dissenting opinion arguing the Court applies standing doctrine inconsistently by accepting commonsense inferences for business plaintiffs while demanding more evidence from civil rights plaintiffs.The opinion is presented here in its entirety, but with citations omitted. If you appreciate this episode, please subscribe. Thank you.