TODAY: Supreme Court To Hear National Association of Manufacturers’ WOTUS Jurisdictional Question

Breaking News: Today, the U.S. Supreme Court agreed to review the Sixth Circuit’s ruling that it has jurisdiction to hear the National Association of Manufacturers and several other groups and states’ challenges to the U.S. Environmental Protection Agency and Army Corps of Engineers’ Clean Water Rule, also known as “Waters of the United States” or “WOTUS.” The review of the challenges has been held up in a jurisdictional fight between the district and appellate courts.

The rule broadens the definition of “waters of the United States,” and in the process broadens EPA and THE CORPS’s jurisdiction to grant or deny permits for projects that may impact such waters.  There are over a dozen challenges of the rule pending in district and appellate court, with the appellate-level challenges consolidated by the Sixth Circuit.  The Sixth Circuit ruled in February that the district courts don’t have jurisdiction to consider the matter.  The plaintiffs in the NAM case asked the Supreme Court to overturn the Sixth Circuit ruling on the question of jurisdiction and allow the district courts to hear their case. 

The Tenth and Eleventh circuits also have cases before them, which the Sixth Circuit has stayed until the NAM case resolves the jurisdiction question.  Challenges were also filed in district court.  The uncertainty over the jurisdiction has resulted in challenges being filed both in the district courts and in the courts of appeals, producing duplicative litigation and potentially conflicting decisions vulnerable to appeal.  NAM challenged the WOTUS rule in the Southern District of Texas under the Administrative Procedures Act.  NAM intervened as a respondent in the Sixth Circuit consolidated action and moved to dismiss for want of jurisdiction. Once the Sixth Circuit ruled that there is direct circuit court review, NAM sought review of the jurisdictional issue before the Supreme Court.

EPA and the Corps Argue WOTUS Is Essentially Permit Issuance 

The EPA and Corps argue that the Clean Water Act vests appellate jurisdiction to review certain categories of EPA decisions implementing the act, such as approving or promulgating any effluent or other limitations, and issuing or denying any permits, under Section 509(b)(1) and as construed by the Supreme Court in its 1977 decision in E.I. du Pont de Nemours & Co. v. Train, and its 1980 decision in Crown Simpson Pulp Co. v. Costle.  The EPA and Corps argue that these cases support a construction of Section 509(b)(1) broadly to give the circuit courts original jurisdiction over EPA actions that directly affect Clean Water Act permitting decisions.

NAM and Other Petitioners Argue WOTUS Defines a Key Regulatory Term

According to NAM, the rule does not “issue or deny any permit,” but instead defines the waters that fall within Clean Water Act jurisdiction, which NAM asserts is reviewable at the district court level.  In the past, according to NAM, the key statutory term “waters of the United States,” has been reviewed first in district courts.  NAM argues that CWA’s limited jurisdictional grant to appellate courts does not include definitional clarifications promulgated by the EPA and the Corps.  As a basic tenet of the Administrative Procedure Act, district courts, not appellate courts, have subject matter jurisdiction to hear challenges to agency rulemaking, such as promulgation of the WOTUS or Clean Water Rule.  NAM has argued in its challenge that the rule allows EPA to regulate waters that are not connected in any way to the navigable waters of the United States.  Thus, NAM claims to be challenging the rule under the principles of the APA, that EPA is overreaching its jurisdiction to regulate under the Clean Water Act, and that the regulation is arbitrary and capricious. 

EPA and the Corps argue that disturbances to any upstream tributary necessarily will flow downstream to navigable U.S. waters, which gives the agency authority under the Clean Water Act to regulate such upstream tributaries and areas connected to them.  The Clean Water Rule will have significant impact on the agricultural industry and property owners in California and throughout the United States.  Our California environmental lawyers are monitoring this case and anticipating potential implications for our agricultural, manufacturing, construction, and property clients.

Potential Future Implications for Challenges to WOTUS

If the Supreme Court rules that the Sixth Circuit has direct jurisdiction, then the cases before the district court may be dismissed, including NAM’s case.  NAM did not file a protective petition in the Sixth Circuit; therefore, NAM would likely intervene in the consolidated 6^th Circuit case to have some level of input in the challenge to WOTUS.  

 If the Supreme Court rules that district courts have jurisdiction, the Sixth Circuit’s stay could be vacated, resulting in inconsistent implementation of the WOTUS rule by various jurisdictions until the multiple district court challenges wind their way through the various district courts and then to the circuit courts for review.  Ultimately, the Supreme Court will likely see this case again, but next time it will be on the merits of the challenge.

 Our California environmental lawyers are also monitoring the potential changes to EPA and the Corps following President-elect Trump’s inauguration next week.  The new Administration may see a sea-change in the agencies’ policies impacting businesses.  If so, the new Clean Water Rule could be nullified by the Administration, reverting to the previous regulations.  Those regulations have been criticized as vague and ambiguous with respect to the jurisdiction of EPA and the Corps.