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IN THE UNITED STATES DISTRICT COURT FOR THE MIDDLE DISTRICT OF NORTH CAROLINA WINSTON-SALEM DIVISION ) FLUE-CURED TOBACCO COOPERATIVE ) STABILIZATION CORPORATION, et al., ) ) Plaintiffs, ) ) V. ) Civil Action No. 6:93CV370 ) UNITED STATES ENVIRONMENTAL ) PROTECTION AGENCY, et al., ) ) Defendants. ) ) MEMORANDUM IN SUPPORT OF PLAINTIFFS' MOTION TO HOLD IN ABEYANCE DEFENDANTS' MOTIONS FOR JUDGMENT ON THE PLEADINGS, TO DISMISS COUNT IV (DUE PROCESS) OR TO STAY CONSIDERATION OF COUNT IV Three of the five motions defendants filed on September 30, 1994, challenge plaintiffs' standing, and seek to dismiss plaintiffs' due process claims, or in the alternative, to stay consideration of those claims.l/ Because these motions contradict the Court's Opinion and Order of July 20, 1994, plaintiffs ask that these motions be held in abeyance until discovery is closed. When this Court rejected defendants' motion to dismiss Counts I, II, and III, it deferred ruling on plaintiffs' motion to dismiss the Count IV due process claims until "after the 1/ Plaintiffs' opposition to the defendants' motion for partial summary judgment limiting judicial review in this case to the "administrative record" that EPA recently constructed, and plaintiffs' opposition to the defendants' motion for a protective order are also being filed today.

parties have developed the factual record" when "any further dispositive motions are filed." See Order at 1; Opinion at 20. The Court did instruct the parties to address standing issues, but only "when such motions are filed" -- that is, after the development of the factual record. Order at 2. Despite this clear direction, defendants have filed a second round of dispositive motions before any discovery has taken place. For the reasons set forth below, these premature motions should be held in abeyance until the discovery period contemplated by the Court concludes.?/ Due Process Defendants violate the July 20 Order by moving now to dismiss plaintiffs' due process claims. The Court's Order is unambiguous -- a ruling on the legal sufficiency of plaintiffs' due process claims has been deferred until "after the parties have developed the factual record." Opinion at 20. There is no reason why this renewed motion to dismiss Count IV must be decided now rather than after discovery closes. Defendants simply do not want to submit to discovery or to wait until it is closed before taking another shot at Count IV. The Court has 2/ At this stage of this case, the parties should be engaging in the normal process of working out specific discovery disputes and completing discovery promptly, rather than debating broad discovery principles in a vacuum filled only by information the defendants chose to disclose. Plaintiffs have already taken a significant step to advance the normal discovery process by specifically addressing defendants' many inadequate responses to our long-pending discovery requests and suggesting some possible solutions. See Letter to Alice L. Mattice, Esq., from John N. Hanson, October 28, 1994 (attached). - 2 -

already decided to defer consideration of defendants' efforts to dismiss Count IV until the facts in this case have been fully developed. Because that has not happened yet, defendants' motion to dismiss Count IV should be held in abeyance. Standing By inviting the government to address the issue of standing when further dispositive motions are filed, the Court anticipated that this litigation would follow the usual course, in which dispositive motions might be filed after the close of discovery. Defendants could have raised standing issues on July 20, 1993 when they asked this Court to dismiss plaintiffs' complaint, but they chose not to do so. Defendants raise standing issues now purportedly in response to the Court's direction in its July 20, 1994 Opinion and Order. But defendants' timing is wrong. Although the Court asked that standing be addressed when further dispositive motions might be filed (Order at 2), it is apparent that the next dispositive stage of the litigation should be "after the parties have developed the factual record." Opinion at 19. If the Court had wanted standing addressed before discovery is completed, it would have said so.3/ Moreover, had 3/ Should the Court want the standing issue briefed now, plaintiffs request 15 days to provide a response to EPA's motion. Plaintiffs easily satisfy the redressability prong of Article III standing tests, as well as the prudential zone of interest standard. Plaintiffs have alleged general and specific facts in the Complaint demonstrating that a decision rescinding the classification of ETS as a Group A carcinogen would redress its injuries. On a motion to dismiss, general factual allegations of injury resulting from the defendants' conduct (continued...) c~t - 3 -

the Court wanted the "factual development" in this case to be limited to a unilateral construction of a "record" by EPA, it would have said so. Instead, by ordering the "parties" to develop the factual record, the Court ordered discovery -- after which defendants' standing motion and other dispositive motions will be considered. Accordingly, defendants' standing motion should also be held in abeyance until discovery concludes. CONCLUSION For the aforementioned reasons, plaintiffs' Motion to Hold in Abeyance should be granted. 3/(...continued) suffice to demonstrate a redressable injury. See Lulan v. National Wildlife Federation, 497 U.S. 871, 889 (1990). The court "presum[es] that general allegations embrace the specific facts that are necessary to support the claim." Id. As to the zone of interests, this Court already has found that EPA's action is reviewable and has a regulatory effect on plaintiffs, thus bringing this case within the ambit of the vast body of precedent that recognizes standing in analogous cases. See, e.a., Chemical Manufacturers Ass'n v. EPA, 28 F.3d 1259 (D.C. Cir. 1994) (EPA pollutant designation vacated on petition of manufacturers' association); International Fabricare Institute v. EPA, 972 F.2d 384, 389-90 (D.C. Cir. 1992) (uer curiam) (parties who use chemicals directly or indirectly regulated are within zone of interest); Calumet Industries, Inc. v. Brock, 807 F.2d 225, 229 n.3 (D.C. Cir. 1986) (manufacturers of regulated chemical have standing to contest regulation of that chemical). Plaintiffs' interest is not remote or academic. The Radon Act protects plaintiffs and tobacco product consumers and, in Section 404, expressly prohibits EPA from taking action beyond its statutory mandate. EPA's unauthorized decision to classify ETS as a Group A carcinogen breaches that prohibition. - 4 -

Dated: November 1, 1994 Of Counsel: BEVERIDGE & DIAMOND, P.C. Suite 700 1350 I Street, N.W. Washington, DC 20005-3311 ARNOLD & PORTER 1200 New Hampshire Avenue, N.W. Washington, DC 20036-6885 SHOOK, HARDY & BACON One Kansas City Place 1200 Main Street Kansas City, MO 64105-2118 Attorneys for Philip Morris Incorporated JONES, DAY, REAVIS & POGUE North Point 901 Lakeside Avenue Cleveland, OH 44114 Attorneys for R. J. Reynolds Tobacco Company BERRY & FLOYD, P.S.C. 407 N. Main Street Post Office Box 245 New Castle, KY 40050 Attorneys for The Council for Burley Tobacco, Inc. Respectfully submitted, ; J- L-~ W ll D W s . e ewey . N.C. State Bar No. Keith W. Vaughan 4645 N.C. State Bar No. 6895 Jeffrey L. Furr N.C. State Bar No. 14107 Lawrence Pierce Egerton N.C. State Bar No. 16617 WOMBLE CARLYLE SANDRIDGE & RICE 1600 Southern National Financial Center 200 W. Second Street Winston-Salem, NC 27102 (910) 721-3600 Attorneys for Plaintiffs Universal Leaf Tobacco Company, Incorporated, Philip Morris Incorporated, and R. J. Reynolds Tobacco Company James K. Dorsett, Jr. N.C. State Bar No. 1212 James D. Blount N.C. State Bar No. 378 SMITH, ANDERSON, BLOUNT, DORSETT, MITCHELL & JERNIGAN 2500 First Union Capital Center Post Office Box 2611 Raleigh, NC 27602-2611 Attorneys for Plaintiffs Flue-Cured Tobacco Cooperative Stabilization Corporation and The Council for Burley Tobacco, Inc.

WILLIAMS, MULLEN, CHRISTIAN & DOBBINS 1021 E. Cary Street Richmond, VA 23219 Attorneys for Universal Leaf Tobacco Company, Incorporated W. Thomas White N.C. State Bar No. 005216 ALLMAN SPRY HUMPHREYS LEGGETT & HOWINGTON, P.A. Suite 700 380 Knoliwood Street Winston-Salem, NC 27103 (910) 722-2300 Attorneys for Gallins Vending Company P:\CLI\10\73\2852\PLG\2852FR41.03 - 6 -