Natural Resources Defense Council v. E.P.A., __ F.3d ___, 2017 WL 2324714 (9th Cir. May 30, 2017). The Ninth Circuit Court has vacated the conditional registration of the pesticide NSPWL30SS (“NSPW”)—an antimicrobial materials preservative that uses nanosilver as its active ingredient—on the grounds that the Environmental Protection Agency (“EPA”) failed to provide substantial evidence that the use of the ingredient was in the public interest. Id. at *2.

NSPW is a material preservative manufactured by Nanosilva LLC that, when incorporated into plastics or textiles, can help suppress the growth of bacteria, mold, mildew, and other odor causing organisms. Id. The active ingredient in NSPW is nanosilver, a version of “conventional” silver that is engineered to have a much smaller particle size. Id. Recognizing the potential benefits of nanosilver, companies began approaching EPA to register the pesticide for sale in accordance with the Federal Insecticide, Fungicide, and Rodenticide Act (“FIFRA”). Id. Under FIFRA, pesticides may be registered on either a conditional or unconditional basis. Id. at *4. Unconditional registration may be granted when an applicant submits sufficient data to evaluate the environmental effects of the product. Id. Alternatively, if the applicant is unable to provide such evidence, EPA may grant conditional registration under specific circumstances. Id. If EPA lacks the data required for unconditional registration because “a period reasonably sufficient for generation of the data has not elapsed,” conditional registration may be granted if the product is found to be in the public interest. 7 U.S.C. § 136a(c)(7)(C). A FIFRA panel was convened to discuss the potential hazards associated with the new pesticide, finding that nanosilver should be treated differently than conventional silvers. 2017 WL 2324714, at *3. Upon review of the FIFRA panel’s findings, EPA decided to conditionally register NSPW. Id. EPA found that NSPW had the potential to reduce environmental loading and silver release, satisfying the public interest requirement, and that Nanosilva LLC had insufficient time to amass the data necessary for unconditional registration. Id.

In its petition, the Natural Resources Defense Council (“NRDC”) opposed EPA’s conditional registration of NSPW, arguing that EPA failed to support its findings that (1) the use of NSPW is in the public interest; and (2) that Nanosilva LLC had insufficient time to submit the required data for conditional registration. Id. at *1. Ultimately, the Ninth Circuit sided with NRDC as to the former argument and did not address the latter.

In reviewing EPA’s decision, the court noted that it would sustain the conditional registration if the public-interest requirement was supported by substantial evidence when considered on the record as a whole—defining substantial evidence as more than a mere scintilla, but less than a preponderance. Id. at *3. The court noted that the public-interest requirement reflects an important distinction between conditional and unconditional registration requirements because it allows for the production of a pesticide with less than complete risk data. Id. at *4. Because there had not been a prior decision considering the public-interest requirement and the statute itself does not further define it, the court looked to the legislative history of the act to understand its implications. Id. at *5. Specifically, the court gave weight to statements made by Senator Leahy, who sponsored the bill, indicating that conditional registration “would be reserved to the truly exceptional case” and that the publicinterest requirement was “a more stringent test” than required for unconditional registration. Id.

EPA had concluded that use of NSPW has the potential to reduce the amount of silver released into the environment. Id. While NRDC did not dispute that reducing the amount of silver released into the environment would be in the public’s interest, they did dispute the underlying assumptions made to support EPA’s conclusion. Id. EPA had relied on three assumptions in concluding that NSPW would potentially reduce the amount of silver leached into the environment. Id. First, NSPW has a lower application rate (meaning it uses less silver) than conventional silver pesticides. Second, NSPW has a lower mobility rate (meaning it is less likely to release silver into the environment in detectable quantities). Lastly, for the lower application and mobility rate to actually lead to a reduction in silver leaching into the environment, EPA had to assume that current users of conventional silver pesticides would switch to NSPW and/or that NSPW would not be incorporated into new products. Id. While the court concluded that the first two premises were supported by substantial evidence, it held that the third premise impermissibly relied on unsubstantiated claims. Id.

The Ninth Circuit reasoned that lower application and mobility rates alone were necessary, but not sufficient, to conclude that nanosilver would decrease the amount of silver introduced into the environment. Id. at *7. For this to be the case, EPA would have to also assume that current users of conventional silver pesticides will replace those pesticides with NSPW (“the substitution assumption”) and that NSPW will not be incorporated into new products to the extent that such incorporation would increase the overall amount of silver introduced into the environment (“the no-new-products assumption”). Id. Because EPA was unable to provide substantial evidence as to these assumptions, the court sided with NRDC in concluding that EPA’s public-interest requirement was not satisfied. Id at *8.

This article originally appeared in the American Bar Association’s “Environmental Litigation and Toxic Torts Committee Newsletter.”