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By Alan Kovski
Oct. 9 — An appeals court placed a nationwide stay Oct. 9 on the Obama administration's rule defining the jurisdiction of the Clean Water Act.
A split decision by the U.S. Court of Appeals for the Sixth Circuit came in a set of cases consolidated into a multi-district, multi-circuit case on the joint rulemaking by the Environmental Protection Agency and the U.S. Army Corps of Engineers.
The issue is important to an extraordinary range of interests, including state and local governments, farmers and commercial and industrial sectors of many kinds. Eighteen state governments in six appellate circuits are among the plaintiffs in the multi-district case.
The stay was issued by a three-judge panel pending further action by the court, including the need to determine the court's own jurisdictional authority before getting to the plaintiffs' complaints that the “waters of the U.S.” rule violated the Clean Water Act and the Administrative Procedure Act (APA).
On the substance of the complaints, the court said there was a good chance the plaintiffs would win on the merits. The EPA and the corps may have violated the APA in their handling of the final rule, and the rule may conflict with the U.S. Supreme Court's Rapanos precedent, the court said (Rapanos v. United States, 547 U.S. 715, 62 ERC 1481, (U.S. 2006)).
The federal defendants urged the appeals court to leave the status quo undisturbed while considering the case—which from the defendants' perspective meant the status quo under the new rule that took effect Aug. 28. The court majority rejected that idea.
“Considering the pervasive nationwide impact of the new Rule on state and federal regulation of the nation’s waters, and the still open question whether, under the Clean Water Act, this litigation is properly pursued in this court or in the district courts, we conclude that petitioners have acted without undue delay and that the status quo at issue is the pre-Rule regime of federal-state collaboration that has been in place for several years, following the Supreme Court's decision in Rapanos v. United States,” the court said.
One judge disagreed. “We can enjoin implementation of the Rule if we determine that we have jurisdiction. But until that question is answered, our subject-matter jurisdiction is in doubt, and I do not believe we should stay implementation of the Clean Water Rule,” Judge Damon Keith wrote.
The majority decided that in “balancing the harms” for opposing parties, it would be better to issue a stay, given “the sheer breadth of the ripple effects caused by the Rule’s definitional changes.”
It added, “A stay honors the policy of cooperative federalism that informs the Clean Water Act and must attend the shared responsibility for safeguarding the nation’s waters.”
The appellate court delved into the arguments for and against the rule only briefly, to support the majority opinion that “petitioners have demonstrated a substantial possibility of success on the merits of their claims.”
Petitioners argued that the rule is at odds with the Rapanos decision, in which a plurality of the court ruled that the federal government was exceeding its jurisdictional authority in its application of Clean Water Act regulations. Justice Anthony Kennedy provided the swing vote and the separate opinion offering his views on how to determine jurisdiction.
“Even assuming, for present purposes, as the parties do, that Justice Kennedy’s opinion in Rapanos represents the best instruction on the permissible parameters of `waters of the United States' as used in the Clean Water Act, it is far from clear that the new Rule’s distance limitations are harmonious with the instruction,” the court said.
The court appeared to be referring to the rule's provision that isolated water bodies and wetlands within 4,000 feet of navigable waters would be considered for regulation.
In addition, the court said, “the rulemaking process by which the distance limitations were adopted is facially suspect. Petitioners contend the proposed rule that was published, on which interested persons were invited to comment, did not include any proposed distance limitations.”
The distance provisions in the final rule were not a “logical outgrowth” of the proposed rule and consequently had not been subjected to notice and comment as required by the APA, petitioners contended.
Federal defendants did not persuasively rebut petitioners' arguments on that point, the court said.
Environmental activists, despite opposing the states in the multi-district case, also have questioned the validity of the 4,000-foot limit, which some of them have described as arbitrary.
“The agencies respect the court’s decision to allow for more deliberate consideration of the issues in the case and we look forward to litigating the merits of the Clean Water Rule,” the EPA said in a statement on behalf of itself and the corps.
“The court acknowledges that clarification of the Clean Water Act is needed and that ‘agencies conscientiously endeavored, within their technical expertise and experience, and based on reliable peer-reviewed science, to promulgate new standards to protect water quality that conform to the Supreme Court’s guidance,' ” the EPA said.
Among the intervenors on the federal agencies' side of the case are several environmental advocacy groups, the District of Columbia and seven states—New York, Connecticut, Hawaii, Massachusetts, Oregon, Vermont and Washington.
The 18 state petitioners were Alabama, Florida, Georgia, Indiana, Kansas, Kentucky, Louisiana, Michigan, Mississippi, North Carolina, Ohio, Oklahoma, South Carolina, Tennessee, Texas, Utah, West Virginia and Wisconsin.
A peculiar twist is that some petitioners wanted cases to go through federal district courts, while EPA and the corps “are strongly on record as saying the court of appeals does have jurisdiction now,” said attorney Richard Stoll, a partner in the Washington office of Foley & Lardner LLP.
So now EPA and the corps must consider themselves bound not to apply or enforce the rule anywhere in the nation, Stoll told Bloomberg BNA.
Critics of the rule welcomed the stay and in some cases hoped for congressional action to force a rewrite.
Tom Woods, chairman of the National Association of Home Builders, issued a statement commending the appeals court and saying, “NAHB has been working diligently on the legislative and legal fronts to overturn this EPA rule that raises housing costs, tramples states' rights and adds unnecessary regulatory burdens to small businesses.”
Bob Stallman, president of the American Farm Bureau Federation, released a statement in support of the court's ruling.
“The judges expressed deep concerns over the basic legality of this rule,” he said. “We’re not in the least surprised: This is the worst EPA order we have seen since the agency was established more than 40 years ago.”
Stallman said the Farm Bureau was “confident that the courts will strike down this rule,” but he added that “cases like this almost always take years to win. So we again ask the Senate to pass legislation to nullify this rule just as the House has already done. Farmers and ranchers cannot afford to wait.”
Sen. James Inhofe (R-Okla.), chairman of the Senate Environment and Public Works Committee, had a similar reaction.
Because a court determination can take several years, Inhofe said, it is “all the more important for Congress to pass the bipartisan ‘Federal Water Quality Protection Act' to provide direction to EPA to develop a different rule.”
Inhofe was referring to S. 1140, a bill proposed by Sen. John Barrasso (R-Wyo.) to address the jurisdictional issue .
Environmental advocacy groups said the stay would delay needed protections for streams and wetlands and the wildlife and water users who depend on them.
“In its decision, the court recognized that a rulemaking was ‘long overdue,’ that the rule was based on ‘reliable peer-reviewed science,’ and that the previous status quo was ‘clouded by uncertainty’, ” Collin O’Mara, president and CEO of the National Wildlife Federation, said in a statement. “We are confident that the strong scientific basis and clear legal authority underpinning the rule will ensure that it is ultimately upheld in the courts.”
Jon Devine, senior attorney in the Water Program at the Natural Resources Defense Council, said every major rule issued by the agency will face legal challenges.
“We look forward to making the case in court about the critical public interests at stake,” he said in a statement.
To contact the reporter on this story: Alan Kovski in Washington at email@example.com
To contact the editor responsible for this story: Larry Pearl at firstname.lastname@example.org
The Sixth Circuit Court of Appeals decision to issue a nationwide stay on the “waters of the U.S.” rule is available at http://src.bna.com/xW.
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