Marine Shale v. EPA ( 1996 )

                                FOR THE FIFTH CIRCUIT
                                      No. 95-60228
                        Petition for Review of Order of
                         Environmental Protection Agency
                                     April 18, 1996
    Before REYNALDO G. GARZA, KING, and HIGGINBOTHAM, Circuit Judges.
    HIGGINBOTHAM, Circuit Judge:
         This case is an appeal of Marine Shale Processors, Inc. from
    final   agency    action    of   the    Environmental      Protection     Agency.
    Specifically,      MSP    challenges     EPA’s    decision    to   deny      MSP’s
    application for a Boiler and Industrial Furnace Permit required by
    the Resource Conservation and Recovery Act, 42 U.S.C. § 6901-92K.
    This case is one of the trio described in United States v. Marine
    Shale Processors, Inc., No. 94-30664.            We affirm.
         In   1980,     EPA    promulgated       regulations   pursuant     to    RCRA
    governing the treatment, storage, and disposal of hazardous waste.
    See, e.g., Final Rule, Hazardous Waste Management:                       Overview and
    Definitions; Generator Regulations; Transporter Regulations, 45
    Fed. Reg. 12,721 (1980); Final Rule, Interim Final Rule, and
    Request      for     Comments,   Hazardous           Waste      Management      System:
    Identification and Listing of Hazardous Waste, 45 Fed. Reg. 33,082
    (1980). These regulations defined two methods of processing waste,
    incineration and recycling.           The rules required facilities engaged
    in incineration to procure a permit called a Subpart O permit, a
    reference to 40 C.F.R. pt. 264 subpt. O.                      See Proposed Rule and
    Request for Comment, Identification and Listing of Hazardous Waste;
    Amendments to Definition of Solid Wastes, 53 Fed. Reg. 519, 522
    (1988).       Facilities engaged in recycling could operate without
    permits.      See 45 Fed. Reg. at 33,120 (promulgating 40 C.F.R. §
    261.6); see also Final Rule, Hazardous Waste Management System;
    Definition of Solid Waste, 50 Fed. Reg. 614, 626-27 (1985).
           In    1985,   EPA   defined    a    new   category       of   hazardous    waste
    processing devices called "industrial furnaces," a term defined to
    include "aggregate kilns" having certain characteristics.                       50 Fed.
    Reg.    at    661.      Industrial        furnaces      could    engage    in    either
    incineration or burning for energy recovery.                      If the industrial
    furnace facility engaged in incineration, then it needed a Subpart
    O permit.         If the industrial furnace engaged in recycling, no
    permit      was   necessary.     50    Fed.      Reg.    at    626-27.     MSP   began
    operations in 1985, claiming an exemption from the Subpart O permit
    requirement on the grounds that its kiln was an aggregate kiln and
    that its facility was an industrial furnace engaged in recycling.
         On August 14, 1990, the United States sued MSP in United
    States District Court for the Eastern District of Louisiana in the
    action giving rise to Nos. 94-30419 and 94-30664, claiming among
    other things that MSP had incinerated hazardous waste without a
    Subpart O permit since it opened for business in 1985.              In 1991,
    EPA promulgated new rules requiring that all devices using thermal
    combustion to treat hazardous wastes have either a Subpart O permit
    or a new form of permit for recycling facilities called a Boiler
    and Industrial Furnace permit.         Final Rule, Burning of Hazardous
    Wastes in Boilers and Industrial Furnaces, 56 Fed. Reg. 7134, 7138
    (1991).    These regulations ended the exception from the permit
    requirement for facilities engaged in recycling.             MSP submitted a
    BIF permit application and a Certification of Compliance with BIF
    regulations. On the basis of these filings and its contention that
    it fit within the previously existing recycling exemption, MSP
    claimed interim status to operate while EPA considered the permit
    application. EPA's internal consideration of MSP's application for
    a BIF permit proceeded simultaneously with litigation of the United
    States' action in Louisiana District Court.
         On January 31, 1994, EPA issued a tentative decision denying
    MSP's BIF permit application.          EPA rested its tentative denial
    decision upon its conclusion that MSP did not produce aggregate and
    that its    system   did   not   use   thermal   treatment    to   accomplish
    recovery of materials or energy within the meaning of 40 C.F.R. §
    260.10.    EPA opened its decision for public comment.
          A jury trial on the United States' claim in district court
    that MSP had incinerated waste without a permit began in April,
    1994.   At the end of a five-week trial, the court submitted 13
    interrogatories to the jury.       In late May, the jury found itself
    able to agree to the answer to only nine of the questions.               The
    questions relevant to this appeal, together with the jury's answer
    if any, were as follows:
               1. Was MSP entitled to a recycler exemption from
          the requirement of a permit as an operator of an
          incinerator of hazardous waste? (unable to answer)
               2. Were all of the hazardous wastes accepted by MSP
          beneficially used or reused or legitimately recycled?
          (unable to answer)
               2(a). Were all of the hazardous wastes accepted by
          MSP prior to August 21, 1991, beneficially used or reused
          or legitimately recycled? (unable to answer)
               10.   Is MSP's rotary kiln an aggregate kiln? (yes)
               13. Are the rotary kiln, oxidizers Nos. 1 and 2,
          and slag box part of a kiln system that produces
          aggregate? (yes)
    Because the jury failed to answer four of the interrogatories, the
    district court declared a mistrial.
          In September, 1994, EPA issued a final decision denying MSP's
    application for a BIF permit.        EPA rested upon its finding that
    MSP's rotary kiln system did "not meet the definition of aggregate
    kiln and, therefore, does not meet the definition of industrial
    furnace." EPA also cited MSP's poor history of compliance with the
    environmental laws, as well as its finding that MSP could not
    qualify as an aggregate kiln because it destroyed hazardous waste.
    MSP   appealed   to   the   Environmental   Appeals   Board,   relying    on
    principles    of   Article    III,    the    seventh     amendment,    collateral
    estoppel, due process, and the Administrative Procedures Act, 5
    U.S.C. §§ 701-06.
         In March, 1995, after a review of the record, the EAB affirmed
    EPA's denial.         In re Marine Shale Processors, Inc., Dkt. No.
    06900009, RCRA Appeal No. 94-12, 
    1995 WL 135572
     (EPA 1995).                   The
    EAB stated that MSP did not produce "commercial-grade aggregate"
    from its system and thus that its facility could not qualify as an
    aggregate    kiln.      The   EAB    questioned    EPA's    reliance    on   MSP's
    compliance history and on MSP's destruction of hazardous waste, but
    ultimately affirmed the decision in its entirety.              In April, 1995,
    EPA finally denied MSP's BIF permit application on all grounds
    stated in its September, 1994 ruling.              MSP appeals the denial of
    its permit, invoking our authority under 5 U.S.C. § 706(2) to set
    aside final agency action.          We affirm.
         MSP invokes Article III, the Seventh Amendment, and collateral
    estoppel principles to attack EPA’s permit denial.
         MSP     begins    its    assault       upon   the    permit   denial    with
    constitutional arguments based on Article III and the Seventh
    Amendment.    Its first argument is that Article III and the Seventh
    Amendment prevent EPA from ruling on its permit application.                  Its
    second argument is that the United States, by filing its lawsuit
    and thus invoking the judicial power of an Article III court, could
    not continue to consider in an internal administrative proceeding
    issues identical to those being litigated in the Article III court.
    With cites to Montesquieu and Madison, MSP argues that the moment
    the United States filed suit the district court obtained exclusive
    power to decide any issue before it and that EPA’s permitting staff
    could not resolve any legal question pending before the district
    court without running afoul of the constitutional prohibition
    forbidding Executive Branch review of Article III court decisions.
    In a similar vein, MSP invokes the Seventh Amendment, contending
    that once the Seventh Amendment is activated as to an issue, a
    party is entitled to have the issue resolved by a jury.
          With regard to both MSP’s Seventh Amendment and Article III
    arguments, we begin with the proposition that, in the absence of a
    simultaneous district court proceeding, Congress violated neither
    constitutional principle by providing that EPA should adjudicate
    MSP’s permit application. See In re Texas General Petroleum Corp.,
    52 F.3d 1330
    , 1336 (5th Cir. 1995) (“Whether an Article III court
    is necessary involves the same inquiry as whether a litigant has a
    Seventh Amendment right to a jury trial.”) (citing Granfinanciera,
    S.A. v. Nordberg, 
    492 U.S. 33
    , 53-54 (1989)).        MSP’s contention to
    the   contrary   comes   decades,       perhaps   centuries,   too   late.
    Congress’s choice to grant EPA authority over the permit proceeding
    represents a classic constitutional example of the public rights
          Viewing our inquiry as governed by “practical attention to
    substance rather than doctrinaire reliance on formal categories,”
    Thomas v. Union Carbide Agricultural Products Co., 
    473 U.S. 568
    587 (1985), we note the following characteristics of the permit
    proceeding.    First, it is a dispute to which the sovereign is a
    party.     See Crowell v. Benson, 
    285 U.S. 22
    , 50 (1932); Murray’s
    Lessee v. Hoboken Land & Improvement Co., 59 U.S. (18 How.) 272,
    284 (1855).      Second, the permit requirement “serves a public
    purpose as an integral part of a program safeguarding the public
    health.”     Thomas, 473 U.S. at 589.         Third, the scientific and
    technical nature of the decisions in this permit proceeding make
    the decision “peculiarly suited to examination and determination by
    an   administrative    agency    specially    assigned     to   that     task.”
    Crowell, 285 U.S. at 46. Fourth, the permit proceeding, and indeed
    most of RCRA itself, deals with a narrowly cabined area of the law.
    See Commodity Futures Trading Commission v. Schor, 
    478 U.S. 833
    852 (1986) (referring to a “particularized area of law”) (internal
    quotation marks omitted). Fifth, the permit application implicates
    a federal right not immediately analogous to the state common law
    causes of action “assumed to be at the ‘core’ of matters normally
    reserved to Article III courts.”          478 U.S. at 853.         Sixth, EPA,
    “unlike the bankruptcy courts under the 1978 Act, does not exercise
    ‘all ordinary powers of district courts,’ and thus may not, for
    instance,    preside   over   jury   trials   or   issue   writs    of   habeas
    corpus.”    478 U.S. at 853 (quoting Northern Pipeline Construction
    Co. v. Marathon Pipe Line Co., 
    458 U.S. 50
    , 85 (1982) (plurality
    opinion)). Seventh, Congress has provided for judicial review over
    the agency’s permit denial under 5 U.S.C. §§ 704-06.            See 
    478 U.S. 7
    at 854-55. Under such circumstances, Congress violated neither the
    Seventh Amendment nor Article III in delegating the permitting
    decision to EPA.
         Having established that EPA could constitutionally adjudicate
    the permitting proceeding in the absence of a suit by the United
    States, we address MSP’s argument that the enforcement action
    altered the constitutional landscape.         We find MSP’s contention
    convincing in neither the Article III nor the Seventh Amendment
    context. At bottom, both arguments fail for the same reason:          This
    is not a case in which EPA has sought to review or alter the
    decision in the district court, to reverse the district court’s
    findings, or to interfere with the judiciary’s ability to issue a
    binding decision.    Cf. Hayburn’s Case, 2 U.S. (2 Dall.) 40 (1792)
    (suggesting that the judiciary could not render an opinion as to
    whether a citizen was entitled to a pension when both the Secretary
    of War and the Congress retained power to decide whether to honor
    the judiciary’s judgment); Town of Deerfield v. FCC, 
    992 F.2d 420
    (2d Cir. 1993) (rejecting the FCC’s attempt to alter or amend a
    federal court judgment).       EPA has, to be sure, disagreed with
    several of the conclusions of the district court, but it has never
    sought to interfere with the effect that these conclusions have
    upon the causes of action being adjudicated there.            The permit
    application   and   the   district   court   litigation   involve   common
    issues, but the two proceedings are deciding different questions,
    the most important of which is that the permit proceeding concerns
    whether MSP may operate legally in the future, while the district
    court proceeding concerns whether MSP has operated legally in the
         Should EPA attempt to use the rulings in the permit proceeding
    to collaterally estop MSP in the district court action, MSP’s
    argument may have force; we make no comment on this question.         Cf.
    Parklane Hosiery Co v. Shore, 
    439 U.S. 322
     (1979) (holding that the
    Seventh Amendment does not prevent an equity court’s determination
    of legal issues from estopping relitigation of the same issues in
    a   subsequent   action   at   law).   But   given   that   EPA     could
    constitutionally adjudicate the permit application in the absence
    of the district court litigation, MSP can make no argument until
    the permitting proceeding has some effect upon the issues being
    decided in the district court litigation.      When and if MSP feels
    that effect, it may litigate these issues.
         Accordingly, EPA has never sought to judge its own case any
    more than it does in any normal permit application proceeding.        If
    the permitting arm of the agency could constitutionally exercise
    jurisdiction over MSP’s permit application in the absence of a
    district court proceeding, as we have held, then nothing in Article
    III prevented EPA’s permit staff and the district court from
    proceeding   simultaneously.      Having   established   this     general
    principle, we examine MSP’s arguments in detail.
         MSP argues that as a result of EPA’s suit, Article III gave
    the district court exclusive power to decide the controversy
    between MSP and EPA.      MSP points to no statute or constitutional
    provision granting exclusive jurisdiction to the federal district
    courts to decide all disputes between EPA and entities like MSP.
    Its argument assumes that there would be no Article III bar had EPA
    denied the permit and then filed the district court suit, or if EPA
    had litigated the suit to completion and then denied the permit.
         We find MSP’s Article III arguments unconvincing.        State
    courts are not Article III courts, yet nothing in Article III
    prevents a state court from litigating the same controversy pending
    before a district court. Kline v. Burke Construction Co., 
    260 U.S. 226
    , 230 (1922).   In such cases, if the state court reaches final
    judgment first, its disposition may preclude further litigation in
    the district court without violating Article III.    Id. at 233-34;
    Wayside Transportation Co. v. Marcell’s Motor Express, Inc., 
    284 F.2d 868
    , 870-71 (1st Cir. 1960).    MSP cites to no case suggesting
    that this principle would change if the state itself were a party
    to both the state court and federal court litigation.      Like the
    Sixth Circuit,
         We see no reason why the rule permitting a second
         tribunal to proceed to the decision of an in personam
         matter within its jurisdiction, in spite of the fact that
         another action between the same parties is pending in
         another tribunal, should not be applicable as between a
         United States District Court and a federal administrative
         agency   in   which   Congress   expressly   has   placed
         responsibility for regulation in a specific area.
    Ashland Oil & Refining Co. v. FPC, 
    421 F.2d 17
    , 21 (6th Cir. 1970).
         MSP cites California v. FPC, 
    369 U.S. 482
     (1962), for the
    broad proposition that any time a federal court has jurisdiction
    over a controversy in which an agency is a party, the agency must
    withhold administrative action until the court has reached a
    decision.    We do not read California so broadly.               In that case, the
    Supreme Court held that the FPC should not have approved a merger
    while a suit challenging the merger, filed by the United States,
    was pending in federal district court.                Justice Brennan’s majority
    opinion does not mention Article III.                  Instead, it justifies its
    holdings with “practical reasons,” primarily the difficulty of
    unscrambling an already consummated merger.
          MSP points out no analogous practical considerations in this
    case.      To the contrary, EPA could reasonably decide that the
    district court litigation promised to continue for years. The EAB,
    for instance, considered MSP official George Eldredge’s statement
    that “whatever action EPA proposes, and whatever the outcome of the
    lawsuit, the case is going to drag on for years.                     In the mean[
    ]time, we’ll be doing business as usual.”                     In re Marine Shale
    Processors, Inc., Dkt. No. 0690009, RCRA Appeal No. 94-12, 
    1995 WL 135572
    , at * 17 (EPA 1994) (internal quotation marks omitted). EPA
    could conclude that awaiting the decision of the judiciary on those
    issues common to the district court litigation and the permit
    proceeding would unduly delay resolution of the important questions
    in   the   latter    and   would      allow      an   admitted   violator    of   the
    environmental       laws   to   continue        operating,    perhaps   in   further
    violation of these laws, until the conclusion of the litigation and
    the inevitable appeal.            Normally, speedy adjudication from an
    administrative agency is something to be encouraged, and we cannot
    fault   EPA’s   decision        not   to   await      the   unavoidably   ponderous
    progress of the district court litigation.
         For    similar    reasons,     we    reject      MSP’s    seventh      amendment
    argument.    As EPA acknowledges, MSP has a right to a jury trial in
    the district court proceeding.           See Tull v. United States, 
    481 U.S. 412
     (1987).   But because the permit application triggered a public
    rights   dispute,     MSP    has   no    right   to    a    jury    trial    in   this
    proceeding.    Atlas Roofing Co. v. OSHRC, 
    430 U.S. 442
    , 455 (1977);
    see also id. at 450 (noting that jury trials may be incompatible
    with agency processes).            MSP cites no case holding that the
    pendency of an action in one tribunal in which a jury trial right
    attaches prevents another tribunal from proceeding without a jury.
    Unless and until MSP is prevented from litigating its defenses in
    the district court to a jury, no arguable jury trial violation has
         Nothing in Beacon Theaters, Inc. v. Westover, 
    359 U.S. 500
    (1959), requires a different result.                  In Beacon Theaters, the
    plaintiff filed an action seeking an injunction prohibiting the
    defendant from prosecuting an antitrust suit.                       The defendant
    counterclaimed in a complaint stating the antitrust cause of action
    and demanded a jury trial.          The trial judge scheduled the hearing
    on the plaintiff’s request for injunctive relief ahead of the jury
    trial on the defendant’s antitrust claim.                  The Supreme Court held
    that the trial court abused its discretion in scheduling the equity
    suit first    because       such   scheduling      would     have   the   effect    of
    depriving the defendant of its right to a jury trial in the
    counterclaim.    Crucial to this holding was the fact that modern
    rules of civil procedure allowed joinder and joint resolution of
    multiple claims of multiple parties, thus in effect giving the
    plaintiff an adequate remedy at law by joining all involved.                      See
    id. at 507, 509, 511; see also Dairy Queen, Inc. v. Wood, 
    369 U.S. 469
    , 472-73 (1962) (interpreting Beacon Theaters in this manner);
    Lytle v. Household Manufacturing, Inc., 
    494 U.S. 545
    , 550-52 (1990)
    (discussing the importance of the fact that legal and equitable
    claims were tried in the same lawsuit in applying the Beacon
    Theaters rule).      In this case, in contrast, the district court may
    not grant a permit, and the adjudicatory arm of EPA may not grant
    the relief sought in EPA’s district court complaint.                       A single
    proceeding could not resolve both issues.
         MSP    next    argues   that       EPA’s   permit     denial    violated     the
    principle of collateral estoppel.               In order to invoke collateral
    estoppel,   however,       “the   issue       under   consideration       [must   be]
    identical to that litigated in the prior action.”                     Copeland v.
    Merrill Lynch & Co., 
    47 F.3d 1415
    , 1422 (5th Cir. 1995).                      MSP’s
    collateral estoppel argument fails because the jury was either not
    asked to resolve or unable to resolve questions crucial to EPA’s
    decision to deny MSP’s permit application.
         MSP    based    its   BIF    permit       application    to    EPA   upon    the
    contention that its kiln system constituted an industrial furnace.
    40 C.F.R. § 260.10 defines industrial furnace as “any of the
    following    enclosed      devices      that    are     integral    components     of
    manufacturing       processes     and    that     use    thermal    treatment      to
    accomplish recovery of materials or energy.”              The definition then
    lists a series of twelve devices by name, which Judge Duplantier
    referred to as the “twelve apostles.” “Aggregate kilns” are one of
    the twelve apostles. As applied to this case, then, section 260.10
    requires EPA to grant MSP a permit if Marine Shale’s kiln is (1) an
    aggregate    kiln,   (2)        that    is    an   integral   component     of   a
    manufacturing process, and (3) that uses thermal treatment to
    accomplish recovery of materials or energy.
         In addition, paragraph thirteen of the definition provides
    that EPA may add other devices to the list of the twelve apostles
    after   consideration      of    five    enumerated    factors   with   a   sixth
    catchall statement that EPA might consider “other factors, as
    appropriate.”   The first of these five factors is “the design and
    use of the device primarily to accomplish recovery of material
    products.”   The remaining four generally focus on the inquiry of
    whether a facility makes a product.
         In an interpretive step that MSP has not challenged, EPA
    analyzed MSP’s permit application in terms of the five factors
    articulated in paragraph thirteen and did not directly focus on the
    narrative criteria preceding the list of the twelve apostles.                    We
    note that the first of the five factors mimics the second of the
    narrative criteria and that both focus on whether a facility
    recovers energy or materials.
         EPA denied MSP’s permit application on the basis of its
    finding that MSP’s kiln system met none of the five factors
    enumerated in paragraph thirteen.1            In particular, EPA discussed
    extensively its grounds for finding that the majority of the
    hazardous    waste    processed    by   MSP   contributed       nothing   to   the
    production of a product and were not recovered or recycled, and
    therefore that MSP did not use thermal treatment to recover energy
    or materials.        In addition, EPA found that MSP’s kiln did not
    produce aggregate after defining aggregate according to commercial
         The jury’s findings covered only a portion of the industrial
    furnace   inquiry     considered   in    terms    of   either    the   narrative
    criteria and the twelve apostles or the five factors in paragraph
    thirteen.    The jury found that MSP’s rotary kiln was an aggregate
    kiln, and that MSP’s kiln, oxidizers, and slag box were part of a
    system that produced aggregate.          For whatever reason, the jury was
    not asked whether MSP uses thermal treatment to recover energy or
    materials.     The interrogatories most analogous to the thermal
    treatment inquiry were questions 2 and 2(a), which asked the jury
    whether the hazardous wastes received by MSP were beneficially used
    or reused or legitimately recycled.              The jury failed to reach a
            Although the EAB affirmed Region VI’s initial decision to
    deny the permit primarily upon the ground that MSP’s kiln was not
    an aggregate kiln, it “recognize[d] that the Region based its
    decision on other grounds as well” and clarified that “to the
    extent we have not ruled on those other grounds, nothing in this
    decision should be construed as preventing the Region from basing
    its final permit decision on these other grounds.” 
    1995 WL 135572
    at * 24. The final agency action of which MSP complains is Region
    VI’s formal denial of its permit application. This denial makes
    clear that one of the bases of Region VI’s denial was MSP’s failure
    to meet the criteria stated above. MSP has not argued to this
    court that our review is limited to the grounds articulated in the
    EAB’s decision.
    verdict on these interrogatories.     Accordingly, EPA decided issues
    that the jury did not, and collateral estoppel does not apply.
         MSP seeks to avoid the force of this argument by contending
    that the jury decided whether MSP used thermal processes to recover
    energy or materials when it decided that MSP produced aggregate.
    This argument is structurally identical to SWP’s contention, which
    we rejected in United States v. Marine Shale Processors, Inc., No.
    94-30419, at 11, that producing a product is necessarily recycling,
    and we disagree for the same reason here.      A reasonable trier of
    fact could find that, to the extent that MSP produced aggregate, it
    did so without recovering the energy or materials in the hazardous
    wastes that it accepted.
         MSP’s brief suffers from the assumption that the only issue in
    the permit application proceeding was whether its rotary kiln
    constituted an aggregate kiln.   That assumption is incorrect.   Not
    all aggregate kilns are industrial furnaces, as the narrative
    criteria of the definition of industrial furnace and the first of
    the five factors in paragraph thirteen make clear.2
           We also reject MSP’s implication that the district court’s
    ruling that MSP had interim status as a BIF estopped EPA from
    denying the permit. Interim status is designed to last only until
    EPA rules on a permit application.
         Because of our disposition of MSP’s collateral estoppel
    argument on the grounds of lack of identity of the legal issues
    involved, we do not reach EPA’s argument that the jury’s findings
    cannot support collateral estoppel because they have not been
    incorporated into a final judgment. We note, however, the tension
    between the dictum in Recoveredge L.P. v. Pentecost, 
    44 F.3d 1284
    1295 (5th Cir. 1995), which suggests that jury findings are
    sufficient to support collateral estoppel even if the verdict has
    not yet resulted in a final judgment, and the holding of Avondale
    Shipyards, Inc. v. Insured Lloyd’s, 
    786 F.2d 1265
    , 1272 (5th Cir.
    1986), which suggests that partial summary judgments are
          MSP argues that EPA's findings of fact and conclusions of law
    were arbitrary and capricious.      We do not agree.
          We limit our review in this case to sections III.A and III.B
    of EPA’s September 15, 1994 Statement of Basis for Denial of Permit
    Application by Marine Shale Processors, Inc.           The findings of fact
    and   conclusions   of   law   included   in   these    two   sections   are
    sufficient to uphold EPA’s decision.           Although we find none of
    EPA’s findings of fact or conclusions of law in these two sections
    arbitrary, capricious, or contrary to law, we focus our discussion
    here on the evidence underpinning the finding that MSP’s system
    does not use thermal processes to accomplish recovery of energy or
    materials and on certain determinations EPA made in deciding that
    MSP’s material does not qualify as aggregate within the meaning of
    40 C.F.R. § 260.10.
          EPA’s finding that MSP has not designed or used its facility
    to accomplish recovery of material products and thus that MSP does
    insufficient. Under Fed. R. Civ. P. 54(b), both jury findings and
    partial summary judgments are subject to revision before entry of
    final judgment. Even when, as here, a trial judge has rejected a
    motion for a judgment as a matter of law seeking to upset the
    jury’s findings, Rule 54(b) provides that this rejection is itself
    subject to revision at any time before final judgment. We thus
    have some difficulty justifying a rule, if in fact it exists in
    this circuit, allowing issue preclusion to attach to jury verdicts
    but not to summary judgments, when neither has been incorporated
    into a final judgment. We do not seek to resolve this tension in
    this case.
         Given our disposition of this case, we also do not reach EPA’s
    argument that the different burdens of proof and nature of the
    proceedings precludes invocation of collateral estoppel.
    not use thermal treatment to accomplish recovery of materials or
    energy is not arbitrary or capricious. As our discussion will make
    clear, EPA’s decisions are highly technical and scientific and are
    not readily susceptible to lay review. Most of these decisions are
    factual.     We   bear   these   considerations        firmly   in   mind   when
    considering MSP’s request that we upset EPA’s conclusions in an
    area in which Congress has chosen to trust the experts.
           Throughout this section, we assume that MSP produces something
    its calls aggregate and that its kiln system is an integral
    component of the process for this aggregate’s production. We focus
    entirely on the question of whether EPA could conclude that MSP
    does not use thermal treatment to accomplish recovery of materials
    or energy, or that the design and use of MSP’s device is not
    primarily to accomplish recovery of material products.
           EPA considered evidence that MSP processed quantities of “lab
    packs” containing wastes that could contribute nothing to the
    production of a product.         The lab packs were packages of kitty
    litter and other absorbent material surrounding glass or plastic
    containers of toxic chemicals.          For example, Dr. Douglas Kendall,
    an EPA chemist, used MSP’s manifests and Material Characterization
    Data   Sheets   to   determine   that       MSP   processed   sulfur,   toluene
    solution,   ammonium     hydroxide,     hydrochloric     acid   solutions    and
    mixtures, nitric acid, and sulfuric acid.              Dr. Kendall confirmed
    that these wastes do not release significant energy when burned
    and, because they react to form gases at high temperatures, could
    not provide    bulk     for    MSP’s   product.     EPA    considered   similar
    evidence regarding such materials as poisons, pesticides, other
    acids, and bases; specific substances included methylene chloride,
    trichlorotrifluoroethane,              chloroform,        perchloroethylene,
    trichloroethylene,            nitric     oxide,      fluorotrichloromethane,
    pentachlorophenol,            ethylenediamine,       formaldehyde,       carbon
    tetrachloride, and phosgene.           MSP’s experts could not specify how
    many of these substances contributed to a manufacturing process.
    MSP’s   handling   of    these     substances     also    suggests   that   they
    contribute nothing to production. MSP employee Annika Keslick told
    EPA that MSP normally opened ten percent of these lab packs, and
    MSP’s examination upon opening was limited to matching the name on
    the glass or plastic container within the pack to the information
    contained on the MCDS or manifest.
           EPA could find that MSP was not accomplishing recovery of
    energy or materials from these wastes.               The composition of the
    wastes themselves did not allow their combustion to contribute to
    any production process, and we cannot understand how MSP could have
    recovered energy or materials from these wastes without sampling
    them to verify their contents. MSP’s only defense of its treatment
    of the lab pack wastes is that the kitty litter and other packaging
    provide mass for its aggregate.              EPA could conclude that this
    argument misconstrues the regulations and is wrong as a matter of
    law.    One does not recycle hazardous waste by placing that waste
    into a container and then recycling the container.
         MSP correctly points out that the lab packs constitute only
    around one percent of the total volume of wastes processed at its
    facility.   Nevertheless, the amount of material is significant in
    absolute terms in that MSP process an average to three to four
    hundred of the lab packs per week, and MSP’s cavalier treatment of
    these “feedstocks” gives us pause when we consider the remainder of
    MSP’s claim that all of its wastes contribute in some way to its
         EPA considered evidence that MSP processed large quantities of
    waste with metal contaminants that contribute in no legitimate way
    to any manufacturing process and thus that MSP’s use of these
    wastes did not constitute recovery of energy or materials.              The
    metallic composition of these wastes spanned the periodic table and
    included highly variable quantities of lead, barium, cadmium, iron,
    silicon, aluminum, manganese, copper, zinc, bromine, strontium,
    calcium, and chromium.    MSP’s kiln did not destroy these metals.
    The residue from the process of metal-bearing waste, which MSP
    calls primary aggregate, normally required slagging to reduce
    leaching potential.
         MSP suggests that it used these metals for two purposes.
    First, all provide mass for the ultimate product.             Second, some
    compounds from these metals had other properties useful to the
    manufacturing process or the ultimate product.         Dr. Paul Queneau,
    a metallurgical engineer, told EPA that iron oxide and alumina and
    titanium are   “chain   formers,   and   they   very   much   enhance   the
    environmental stability of the slag.”              Other metallic oxides lower
    the melting point of the mixture and decrease its “melt viscosity.”
           EPA’s disbelief of these justifications was not arbitrary or
    capricious.    EPA scientists stated that the metal content of the
    waste necessitated slagging before the ultimate product could be
    legally    placed   on   the     ground    and    that     the    slagging    process
    significantly reduced the mass produced.                 Dr. Terrance McNulty, an
    expert in extractive metallurgy, also provided evidence that many
    of these metals impeded production of the slag.                         Barium, for
    instance, which at times constituted fourteen to sixteen percent of
    the slag mass, impeded production because the high melting points
    of   its   compounds     made     liquification          more    difficult.      Most
    importantly, EPA considered evidence suggesting that while many of
    the metal compounds do exhibit some of the desirable properties
    that Dr. Queneau identified, they do so only when present in
    certain concentrations.         Chemist Stanley Wrobleski confirmed that
    Marine Shale made no attempt to control the metallic composition of
    its primary or slagged material and that metal concentrations
    varied widely.      Moreover, EPA considered evidence such as a letter
    from    Woodward-Clyde     Consultants,          MSP’s     primary    environmental
    consultant, to George Eldredge, an MSP officer, stating that many
    of   the   metal    compounds     “are    not     introduced       specifically     or
    purposefully   into      the    raw   product     in     order   to   incorporate    a
    particular physical characteristic into the produced aggregate but
    are inherent elements of the raw materials used in the manufacture
    of the aggregate.”3   Under such circumstances, EPA could conclude
    that MSP’s process did not recover of these metal-bearing wastes or
    their metallic constituents.4
         The largest percentage of MSP’s wastes consists of soil
    contaminated by organic compounds.    MSP contends that the soil
             Although this same letter concluded that “these elements
    are beneficial in enhancing the quality of the produced aggregate,”
    it appears that this conclusion was based entirely upon the
    coincidence that “the majority of the elements of the produced
    aggregate are also the major constituents in some of the more
    common and select construction materials in use today.” Nothing in
    this letter sought to match the concentration of metals in MSP’s
    material to that in the more common and select construction
    materials. Marine Shale’s argument would lead to the conclusion
    that any material containing sugar, butter, eggs, and flour is a
           EPA warned the regulated community about this type of “use”
    of metallic compounds shortly after filing the lawsuit in this
         The Agency notes in addition that it ordinarily does not
         consider metal-bearing hazardous wastes to be used as
         ingredients when they are placed in industrial furnaces
         purportedly to contribute to producing a product. . . .
         To be considered legitimate use as an ingredient, it
         would normally need to be demonstrated to EPA (or an
         authorized State) pursuant to § 261.2(f) that the
         hazardous metal constituents in the waste are necessary
         for the product (i.e. are contributing to product
         quality) and are not present in amounts in excess of
         those necessary to contribute to product quality. This
         would normally require some demonstration that these
         hazardous metal constituents do not render the product
         unsafe for its intended use. (The other sham recycling
         criteria discussed frequently by EPA would have also to
         be satisfied). The types of uses of hazardous wastes in
         industrial furnaces to produce waste-derived products of
         which the Agency is aware, such as using hazardous wastes
         to produce aggregate or cement[,] . . . do not appear to
         satisfy these criteria.”
    Final Rule, Burning of Hazardous Wastes in Boilers and Industrial
    Furnaces, 56 Fed. Reg. 7133, 7185 (1991).
    provides raw material, or mass, for its aggregate and that the
    organic compounds release heat when burned.        Accordingly, MSP
    argues that both the soil and the waste contribute to its aggregate
    production process.
         EPA’s rejection of these arguments was not arbitrary or
    capricious.   EPA considered evidence that some of these wastes
    consisted of soil contaminated with pentachlorophenol, which it
    specifically labeled a low energy hazardous waste constituent.   In
    addition, EPA could conclude that MSP’s process generates heat far
    in excess of that needed to make its product.     Ronald Corwin, an
    EPA expert witness, suggested that the vast majority of the heat
    MSP produced from its burning travels in non-contact cooling water
    through MSP’s facility and out into Bayou Boeuf.          While MSP
    correctly points out that no recycling process is one hundred
    percent efficient, EPA’s assessment of whether this heat is used or
    wasted is a particularly technical judgment about the overall
    efficiency of MSP’s process.    We will not disturb this judgment in
    this case.
         At oral argument, MSP strenuously contended that EPA’s permit
    denial decision rested on the conclusion that EPA could reject the
    application if MSP burned a thimbleful of hazardous waste for
    destruction, and thus that EPA had imposed an unreasonable burden
    in requiring a potential BIF to prove that it was recovering every
    atom or every bit of heat from waste in order to claim entitlement
    to a BIF permit.      We make no comment on this argument; this is
    simply   not   a   thimbleful   case.     EPA   has   concluded   that   the
    overwhelming majority of MSP’s wastes are burned for destruction,
    not used for recovery of energy or materials.         The findings of fact
    and conclusions of law underlying these decisions are not arbitrary
    or capricious.      EPA could conclude that to the extent that MSP
    produced a product, it did so in spite of the wastes it purported
    to recycle.
         MSP’s final attack on this analysis is that a focus upon
    recovery of energy or materials constitutes an analysis of the role
    that each material plays in the manufacturing process and of the
    purpose the particular facility serves.         After the promulgation of
    the BIF regulations, MSP argues, a focus on purpose is improper.
    In particular, MSP quotes the EAB’s statement that “we have serious
    doubts as to whether after promulgation of the BIF rule the purpose
    for which MSP is burning hazardous waste at the facility is
    relevant to the determinant of whether MSP’s facility meets the
    industrial furnace definition.”          In re Marine Shale Processors,
    Inc., Dkt. No. 06900009, RCRA Appeal No. 94-12, 
    1995 WL 135572
    , at
    * 25 n.32 (EPA 1995).      MSP also notes that 40 C.F.R. § 266.100
    establishes that the BIF rules regulate BIFs without regard to
    whether the particular facility is burning for destruction or is
         MSP’s argument fails to separate two analytically distinct
    issues and regulations.         40 C.F.R. § 260.10 governs whether a
    facility definitionally qualifies as a BIF.           Once a facility has
    definitionally qualified as a BIF, 40 C.F.R. pt. 266 subpt. H
    governs most aspects of its operations, including burning for
    destruction. Although we note that some tension might arise if EPA
    were to interpret section 260.10's definition of BIF to exclude a
    facility that burns a thimbleful of waste for destruction, EPA has
    not done so here, as is made clear by EPA’s focus on whether MSP
    uses its kiln system “primarily to accomplish recovery of material
    products.”      40 C.F.R. § 260.10 (emphasis added).               We cannot
    conceive   of   an   interpretation    of    “to    accomplish   recovery   of
    materials or energy” and other similar phrases in section 260.10
    that does not focus on purpose.
         An analysis of the preambles to the regulations defining BIFs
    supports our conclusion.      In distinguishing between boilers and
    incinerators, EPA did seek to shift the initial focus of the
    definitional inquiry from primary purpose to structural design.
    Thus, EPA considered and eventually adopted a definition of boiler
    depending on whether the facility “achieve[s] heat transfer within
    the combustion chamber itself, generally by exposing the heat
    recovery surface to the flame.”            Proposed Rule, Hazardous Waste
    Management System:      General, 48 Fed. Reg. 14,472, 14,483 (1983);
    see Final Rule, Hazardous Waste Management System; Definition of
    Solid Waste, 50 Fed. Reg. 614, 626-27 (1985).5           But EPA recognized
    that some facilities normally engaging in recycling lacked this
            Even in the boiler context, EPA            used the integral design
    test as a proxy for discovering the                 primary purpose of the
    facility.   See, e.g., 50 Fed. Reg. at              626 (“The definition of
    boilers focuses on physical indicia of             their legitimate use for
    energy recovery.”).
    distinguishing characteristic of boilers, and therefore chose to
    rely in part upon the primary purpose test in defining industrial
    furnaces.    50 Fed. Reg. at 626-27.       Thus, the language of the rules
    and the preambles support our conclusion that EPA may interpret 40
    C.F.R. § 260.10 to include a focus on the primary purpose of the
    facility or the role played by wastes processed within it.
         We hold that EPA’s refusal to label MSP’s kiln an aggregate
    kiln was not arbitrary or capricious.            MSP’s primary attack upon
    this portion of EPA’s reasoning is that EPA erred by narrowing its
    definition of “aggregate” to “commercial grade aggregate.”                In
    particular, MSP disputes EPA’s reliance upon standards promulgated
    by the Louisiana Department of Transportation in reaching its
    decision that MSP’s material does not constitute commercial grade
    aggregate.        EPA’s interpretations of its own regulations are
    entitled to substantial deference.               Ford Motor Credit Co. v.
    444 U.S. 555
    , 566 (1980).          We find no error.
         In making its adjudicative decision, EPA had to employ some
    set of standards to distinguish aggregate from any material, like
    cigarette ash, capable of occupying space.            The history of EPA’s
    focus on recycling of hazardous wastes to produce a commercial
    product,     as    well   as   the   use    of     commercial   terms   like
    “manufacturing” process and “industrial” furnace, suggests that
    EPA’s decision to employ commercial criteria in its decision was
    reasonable at least.
         EPA considered factual evidence from witnesses knowledgeable
    in the construction field that aggregate purchasers typically
    employ at least some specifications for the product they purchase.
    In addition, EPA heard evidence that a material must meet LaDOT
    specifications before the State of Louisiana will buy it for state
    construction projects and that many private commercial contractors
    adopt these specifications as well.     In the face of this legal
    history, regulatory language, and factual evidence, we cannot fault
    EPA’s choice to rely on common commercial specifications to define
    the term “aggregate kiln” in 40 C.F.R. § 261.10.
         We also find nothing wrong with EPA’s decision to consider
    LaDOT criteria as highly indicative, though not conclusive, of the
    content of common commercial specifications.   MSP has proposed no
    alterative set of standards or definition.     Federal courts give
    deference to an agency’s interpretation of its own rules; under the
    circumstances of this case, however, we seriously doubt that such
    deference is necessary.   We find no error in EPA’s choice of legal
         Given EPA’s legal interpretation of its own regulation, we
    find nothing arbitrary or capricious in its application of this
    interpretation to the facts at hand, and we refuse to upset its
    conclusion that MSP’s material is not commercial grade aggregate.
    MSP concedes that its material, and substances made from it, could
    not comport with many of the LaDOT standards.      In addition, MSP
    concedes that it conducts no tests at all on its material to
    determine strength, size, shape, specific gravity, absorbency,
    durability, compaction, or texture.           Although MSP presented expert
    studies suggesting that its slagged and primary material could be
    useful   in   the    production    of    certain   concrete     and   asphaltic
    products, other experts disagreed.              The choice of which expert
    opinions to credit belongs to the EPA permitting staff.                Like the
    Environmental Appeals Board, we are struck by the fact that MSP has
    never field tested any of the products that its experts testified
    might possibly be manufactured in part from its slagged and primary
    material and that none of MSP’s product has ever been commercially
    used for these purposes. In re Marine Shall Processors, Inc., Dkt.
    No. 06900009, RCRA Appeal No. 94-12, 
    1995 WL 135572
    , at * 12 (EPA
    1994).   Under such circumstances, EPA’s application of the law to
    the facts is not arbitrary or capricious.
         MSP continues its attack on the permit denial process by
    alleging   that     EPA's    failure    to   insulate   fully   the   personnel
    litigating the district court action from those participating in
    the permit denial process rendered the latter deficient under the
    Due Process Clause.         MSP highlights the roles of two individuals,
    Dr. Allyn Davis and Ms. Terry Sykes.6              We find no due process
           MSP also devotes a footnote to an allegation of misconduct
    by Mr. Steven Silverman, an attorney in EPA’s Office of General
    Counsel, labeling him the “finalizer” of EPA’s permit denial
    decision. This portion of MSP’s argument lacks merit.
          Dr. Davis was the Director of EPA Region VI's Hazardous Waste
    Management Division, which has oversight of both enforcement and
    permitting issues within Region VI.                  Dr. Davis referred MSP’s
    facility to EPA's enforcement arm.                  He later made the initial
    determination that MSP should not receive a BIF permit.                        MSP also
    attacks Dr. Davis's adjudicative role on the grounds that his
    deposition testimony showed that he had prejudged certain key
          We   find    nothing    remarkable       in   Dr.    Davis’s      role    in   the
    permitting process.
          It is also very typical for the members of administrative
          agencies to receive the results of investigations, to
          approve the filing of charges or formal complaints
          instituting enforcement proceedings, and then to
          participate in the ensuing hearings.        This mode of
          procedure does not violate the Administrative Procedure
          Act, and it does not violate due process of law.
    Withrow v. Larkin, 
    421 U.S. 35
    , 56 (1975).                In his depositions, Dr.
    Davis repeatedly testified that he had not prejudged issues, that
    his decisions were based on information available at the time, and
    that he had decided to refuse MSP’s permit application after an
    unbiased review of the evidence involved in the case.                          The fact
    that Dr. Davis came to one conclusion based on some evidence did
    not   at   all    prevent    him   from   deciding        the   issue   fairly       when
    confronted with all the evidence.               See NLRB v. Donnelly Garment
    330 U.S. 219
    , 236-37 (1947) (holding that a hearing examiner’s
    prior adverse ruling did not prevent him from adjudicating the same
    case on retrial even though the examiner’s initial decision had
    been reversed for improper exclusion of evidence).
         Ms. Sykes was one of the United States' attorneys in the
    enforcement action at pre-trial and early in the trial itself.
    After Dr. Davis and permit staff determined initially that EPA
    should deny MSP's permit application and identified the grounds for
    that determination, Ms. Sykes wrote a draft of the findings of fact
    and conclusions of law that served as the basis for EPA's statement
    justifying the permit denial.      Permit staff official Elaine Taylor
    provided evidence that Ms. Sykes became involved only after the
    permitting branch had completed an exhaustive review of MSP’s six
    volume   application,    after   Dr.       Davis   had   approved   the   staff
    recommendation to deny the permit, after the staff had identified
    the grounds for the refusal, and several months after Ms. Sykes
    resigned from the district court litigation team.              EPA relied on
    Ms. Sykes because of the illness of another attorney.
         Ms. Sykes’ role in the process was less than ideal, and the
    EAB correctly labeled it a mistake in judgment.            In re Marine Shale
    Processors, Inc., Dkt. No. 06900009, RCRA Appeal No. 94-12, 
    1995 WL 135572
    , at * 23 (EPA 1994).      The question, however, is whether Ms.
    Sykes’ role denied MSP due process.           We think not.
         Ms. Sykes “is entitled to the normal presumption of good faith
    that, in courts of law, government officials still enjoy, that must
    be refuted by well-nigh irrefragable proof.”               Starr v. FAA, 
    589 F.2d 307
    , 315 (7th Cir. 1979); see Schweiker v. McClure, 
    456 U.S. 188
    , 195-96 (1982).     MSP’s burden is to persuade us that the use of
    Ms. Sykes posed “such a risk of actual bias or prejudgment that the
    practice must be forbidden if the guarantee of due process is to be
    adequately implemented.”   Withrow, 421 U.S. at 47.   In this case,
    Ms. Sykes’ made no decision at all.     She had no power to decide
    whether to grant MSP its permit, nor did she have power over those
    making that decision.   Her role consisted entirely of articulating
    the thoughts and decisions of others.    Even if Sykes’ mind were
    “irrevocably closed,” FTC v. Cement Institute, 
    333 U.S. 683
    , 701
    (1948), she had a small role in the decision making process.
         MSP analogizes Sykes’ role to that of a federal court law
    clerk and argues that our decision in Hall v. SBA, 
    695 F.2d 175
    (5th Cir. 1983), mandates reversal here.    In Hall, we remanded a
    judgment for a new trial because a magistrate judge used a law
    clerk who from previous experience possessed intimate knowledge of
    the facts of the case and who had previously written a letter to
    the defendants stating that she agreed with the plaintiff.     Hall
    does not control our decision in this case for two reasons.   First,
    Hall was a decision under 28 U.S.C. § 455, which governs judicial
    conduct.   “As this and several other circuits have recognized,
    section 455 establishes a statutory disqualification standard more
    demanding than that required by the Due Process Clause.”      United
    States v. Couch, 
    896 F.2d 78
    , 81 (5th Cir. 1990); see also Dirt,
    Inc. v. Mobile County Commission, 
    739 F.2d 1562
    , 1566 (11th Cir.
    1984) (“Although such an appearance of bias is clearly present in
    this case, the standards governing administrative proceedings are
    far more relaxed than those controlling judicial hearings.”).
    Second, the Hall law clerk was involved throughout the entirety of
    the trial; she wrote bench memoranda, administered the case until
    the end of litigation, and had daily informal access to the
    magistrate. The danger existed that her bias affected the decision
    itself.     In this case, the record shows that EPA used Sykes only
    after unbiased staff had reached the tentative decision to deny
    MSP’s permit and had identified the grounds for the denial, and
    that Sykes had no role in the process beyond providing a draft of
    the eventual findings of fact and conclusions of law.
           By comparison, we note that district courts occasionally adopt
    wholesale the findings of fact and conclusions of law written by a
    victorious litigant.      While we discourage this practice, we have
    never radically altered the standard of review in such cases, much
    less concluded that such an adoption results in a per se due
    process violation.    See Lewis v. NLRB, 
    750 F.2d 1266
    , 1272 n.5 (5th
    Cir. 1985); James v. Stockham Valves & Fittings Co., 
    559 F.2d 310
    314 n.1 (5th Cir. 1977) cert. denied, 
    434 U.S. 1034
     (1978).                  We
    tolerate the occasional use of this device because of our trust
    that district courts will closely examine the proposed findings and
    will   carefully   consider    the   objections      and   arguments   of   the
    opposing party.    In this case, EPA formalized exactly this sort of
    review process.    After Sykes wrote the proposed findings, EPA gave
    MSP an opportunity to criticize her work.            MSP took full advantage
    of   this   opportunity   by   filing   18   boxes    of   argument.    EPA’s
    permitting staff then reexamined the findings and adhered.
           These facts distinguish this case from Bethlehem Steel Corp.
    v. EPA, 
    638 F.2d 994
    , 1009 (7th Cir. 1980), upon which MSP
    principally relies.      MSP does not allege that EPA failed to
    disclose the grounds for its decision, that prosecutorial staff
    sought to delay the timing of an adjudication in order to gain a
    tactical advantage, or that adjudicatory staff sought to force MSP
    to waive certain litigation defenses in return for favorable
    treatment on its permit application.           It was the combination of all
    of these factors, together with the improper mixing of adjudicatory
    and prosecutorial staff, that concerned the Seventh Circuit in
    Bethlehem Steel.
         We question whether the use of Sykes as a federal law clerk
    would have passed the muster under section 455, given our statement
    in Hall that “[e]very judge has suffered a change of heart after
    reaching a tentative decision.               Much might happen during the
    research and writing to affect the decision.             Until the decision
    was signed and rendered, it was in pectore judicis, subject to
    possible   influence.”        685    F.2d    at   179.   Nevertheless,      the
    constitutional     standard    for    agency      adjudication   is   not    as
    stringent, and we hold that EPA provided MSP due process of law in
    its review of the permit application.
         MSP makes one final argument.            It contends that EPA exceeded
    its statutory authority by basing the permit denial in part on
    MSP's poor history of compliance with environmental laws.                   We
    refuse to reach this argument.              We have upheld EPA’s denial of
    MSP’s permit on other grounds, and MSP does not argue that the
    inclusion of this alternative grounds for decision renders the
    permit denial infirm.