It involved a process called New Source Review, a 1977 amendment to the Clean Air Act. New Source Review requires the nation's 17,000 power plants, oil refineries, paper mills and other factories to submit to an EPA pollution analysis whenever they expanded or modernized in a way that increased pollution emissions. Often, that analysis triggered more pollution controls that cost millions.

Industry found New Source Review onerous and expensive, and during its first term the Bush administration announced that EPA would change cost thresholds, essentially exempting certain plant modifications, thereby weakening the rule.

"They overreached wildly, and put in thresholds that meant almost no one would have to comply," said Bruce Buckheit, then EPA director of air enforcement. Buckheit resigned the following year after being ordered to drop 75 already active New Source Review investigations, 17 of which were so serious they had been referred to the Justice Department.

Whitman, the former New Jersey governor who was EPA administrator at the time, publicly supported Bush's revisions to New Source Review. Privately, she later said, she found it so outrageous that she refused to sign it.

"The devil's in the details, where you set the numbers." Whitman said. "They set the numbers far too low."

She resigned, though she would not say why for years.

"You could tell they were going to lose in court, but that was the attitude," Whitman said. "Clearly, there were those in industry who said, 'Go ahead and do that, because every day that you don't tighten these regulations, I make money.' "

Three years later, in New York v. EPA, the D.C. Circuit ruled as Whitman and EPA career lawyers predicted.

The court wrote that the EPA's new lowered thresholds violated the plain language of the Clean Air Act, which called for stringent pollution rules to kick in whenever a factory undergoes "any physical change."

The EPA had argued that the word any in the law was ambiguous. Therefore, it reasoned, there could be exceptions.

The court disagreed, and took the unusual step of mocking the EPA with a reference to Lewis Carroll's Through the Looking-Glass:

"Only in a Humpty Dumpty world would Congress be required to use superfluous words while an agency could ignore an expansive word that Congress did use. We decline to adopt such a world view."

Whitman said part of the reason Bush's EPA lost so many court cases was because circuit judges in Washington were well aware of the administration's penchant for distorting science and pushing legal envelopes.

"The assumption was always that this group was going to try to fudge facts or manipulate data," Whitman said.

For example, in a related New Source Review case, the D.C. Circuit threw out portions of a Bush EPA rule that allowed some factory owners who modified their facilities to dispense with record-keeping. The EPA had reasoned that this was OK, so long as the factories didn't expect the changes to increase emissions.

The court said that made no sense: If nobody kept records, how could the EPA ever determine if emissions stayed the same?

Clear Skies or 'Clear Lies'?

A major part of the Bush strategy was to try to dramatically change the existing Clean Air Act - the umbrella law that set a foundation for national air pollution regulation - with sweeping legislation called Clear Skies.

Clear Skies would have created, in many cases, new air pollution and mercury controls for power plants. Bush aides said these standards were more stringent; critics said they would have delayed meaningful health benefits for years. Robert F. Kennedy Jr. and other environmentalists called Bush's proposal "Clear Lies."