Supreme Court Petition Challenges EPA's HFC Allowance Allocation Under AIM Act

Event summary

  • New Civil Liberties Alliance (NCLA) petitioned the Supreme Court on February 27, 2026, to review the Choice Refrigerants v. EPA case, challenging the EPA's allocation of HFC allowances under the AIM Act.
  • The petition argues that the AIM Act fails to provide the EPA with clear guidance on how to allocate 98% of the allowances in the HFC market, violating the Nondelegation Doctrine.
  • The D.C. Circuit Court misapplied the Clean Air Act's allocation rules to the AIM Act, leading to EPA's flawed decisions that decimated Choice Refrigerants' market share.
  • EPA's allocation decisions favored new market entrants, a former import agent, and a Chinese-owned company that infringed Choice's patents, despite the AIM Act's lack of specific allocation methods.

The big picture

The petition highlights a critical tension between congressional delegation of authority and the constitutional limits on executive power. The case could set a precedent for how agencies allocate resources in economically significant markets, particularly those involving environmental regulations. The outcome may also influence future legislative efforts to balance regulatory flexibility with constitutional accountability.

What we're watching

Regulatory Clarity
Whether the Supreme Court will enforce or replace the intelligible-principle test to provide clearer guidance for agencies like the EPA in allocating market allowances.
Market Impact
How the outcome of this case will affect the HFC market and other industries subject to similar regulatory frameworks.
Constitutional Precedent
The potential long-term implications for the Nondelegation Doctrine and the balance of power between Congress and executive agencies.