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Feb. 22 — Challenges to a rule clarifying the regulatory reach of the Clean Water Act will be heard by a federal appeals court under a ruling delivered Feb. 22 by the U.S. Court of Appeals for the Sixth Circuit.
A three-judge panel for the Sixth Circuit ruled 2-1 that the appeals court, not the district courts, was the appropriate venue to hear challenges to the Clean Water Rule (RIN 2040–AF30). Writing for retaining the appeals court's jurisdiction over challenges to the rule, Judge David McKeague said he drew on the last 35 years of legal precedents set by the U.S. Supreme Court and the Sixth Circuit, which favored a “functional” approach in construing the Clean Water Act provisions regarding judicial review.
The Sixth Circuit was asked to rule whether a district court or an appeals court was the proper venue to hear challenges to the rule promulgated by the Environmental Protection Agency and the U.S. Army Corps of Engineers June 29, which took effect Aug. 28 (80 Fed. Reg. 37,054).
The Justice Department argued for the challenges to be heard in the appellate court from to avoid a waste of judicial and resources, substantial delays in resolving challenges to the rule, and inconsistent rulings. In contrast, the American Farm Bureau Federation and a number of other industry groups that are opposed to the rulemaking want the cases to be heard at the district court level.
“These precedents support the Agencies’ position that this court does have jurisdiction. The district courts that have confronted the jurisdictional question in this litigation have arrived at conflicting answers,” McKeague said. “For the reasons that follow I conclude that Congress’s manifest purposes are best fulfilled by our exercise of jurisdiction to review the instant petitions for review of the Clean Water Rule.”
Joining him in the ruling was Judge Richard Griffin, who agreed that the Sixth Circuit should be the court of jurisdiction to hear arguments on the merits of the clean water rule, but differed on rationale. Senior Judge Damon Keith dissented and said he would have sent the case back to district courts.
The Sixth Circuit's decision is significant because the other courts in which challenges to the rule have been filed can't even begin to judge the merits of the claims until the question of venue was resolved. Since its publication, the rule has been challenged by 32 states and dozens of national, regional and local industry and business groups in dozens of courts across the country.
The Sixth Circuit already has consolidated 20 challenges to the Clean Water Rule, while an additional 13-plus challenges remain in a holding pattern in federal district courts awaiting the Sixth Circuit's decision. The Eleventh Circuit too on Feb. 18 shelved oral arguments scheduled for Feb. 23 on the same question of venue pending the Sixth Circuit's decision.
The ruling also means that the Sixth Circuit's nationwide ban on implementing the Clean Water Rule (RIN 2040–AF30) will remain in place, at least until it rules on the merits of the challenges. The Clean Water Rule is intended to clarify which waters and wetlands are regulated under Clean Water Act requirements for permitting, oil spill prevention and state water quality certification programs.
The question of venue arose because the Clean Water Act doesn't specify a particular court for hearing challenges to water pollution rules. Under 33 U.S.C. § 1369(b)(1) codifying the Clean Water Act, challenges to effluent limits and issuance or denials of National Pollutant Discharge Elimination System permits can be heard in appellate courts, while the Administrative Procedure Act clearly allows judicial review to occur in a district court for a “final agency action for which there is no other adequate remedy in a court.”
In the ruling, McKeague cited the U.S. Supreme Court decision in E.I. du Pont de Nemours Co. v. Train, 430 U.S. 112, 136 (1977) that “defined the scope of direct circuit court review under subsection (E) more broadly than a strict interpretation of its language would indicate.”
He agreed that the Clean Water Rule was more definitional in nature than the prescribed limitations in the Clean Water Act.
“Yet, neither does the Rule create an exemption from limitation. By clarifying the definition of `waters of the United States,' the Rule undeniably has the indirect effect of altering permit issuers’ authority to restrict point-source operators’ discharges into covered waters,” McKeague wrote.
In contrast to McKeague, Griffin said he only supported McKeague because he is bound by the Sixth Circuit's decision in Nat’l Cotton Council of America v. EPA(553 F.3d 927, 68 ERC 1129, 2009 BL 1441 (6th Cir. 2009)). In that ruling, the court agreed to consolidate the challenges that were filed against a 2006 EPA rule on pesticide spraying by extending jurisdictional review from the “issuance or denial of a particular permit” to “the regulations governing the issuance of permits” and those regulating the underlying permit process.
“Were it not for National Cotton, I would grant the motions to dismiss,” Griffin wrote.
The 2006 EPA rule was challenged in the U.S. District Court for the Northern District of California as well as all Circuit Courts of Appeal, with the exception of the Eleventh Circuit, and was ultimately overturned by the Sixth Circuit.
In contrast, Keith dissented with Griffin's' reading of National Cotton Council, saying the Sixth Circuit engaged in “a limited expansion of subsection 1369 under the Clean Water Act” to include reviews of not only regulations governing the issuance of NPDES permits, but also approvals and denials of such permits. He said the Sixth Circuit, despite Griffin's assertion, did not apply that Clean Water Act provision to “anything relating to permitting procedures.”
McKeague and Griffin were the same two judges who voted in favor of staying the Clean Water Rule nationwide in October, Paul Beard, counsel in the Sacramento office of Alston & Bird LLP, told Bloomberg BNA Feb. 22.
These two judges also indicated at the time that there is a strong likelihood that challenges to the rule would be successful on the merits, Beard said.
“What does that mean in terms of the Supreme Court review and the way it is decided,” Beard said. If the rule is struck down 2-1, the government may file a petition for review with the Supreme Court, “but the problem is we have a 4-4 court. With Justice Scalia gone, the most the government can hope for is that four justices rule for reversal and four justices for affirmance, leaving the lower court decision to prevail.”
Alternatively, if the Sixth Circuit affirms the rule and it reaches the Supreme Court where there is a 4-4 tie, then the rule could be upheld. Beard said this is an interesting conundrum for lawyers to plan their strategy whether they should allow the rule to go through the district court and the appeals process before reaching the court, “playing the longer more optimistic game, hoping that a Supreme Court in a year from now will restore the 5-4 balance that existed before Justice Scalia passed.”
Richard Stoll, partner in the Washington D.C. and Milwaukee offices of Foley and Lardner LLP, predicted Feb. 20 that the Eleventh Circuit's decision to shelve the oral arguments was a harbinger of the Sixth Circuit's decision. He said the decision doesn't clear up the confusion over which court will hear the challenge.
“Even if this ruling stands in the 6th Circuit, I am not aware of any doctrine (I have not researched this) that compels district courts in other circuits to abide by the 6th Circuit’s decision,” Stoll told Bloomberg BNA in a Feb. 29 e-mail. “Thus some other district courts (like North Dakota) might decide to go along their merry way and proceed with full judicial review of the rule even as the 6th Circuit process moves forward.”
Stoll said it was ironic that the government sought appellate review despite the nationwide stay on the rule. Moreover, “Since there was a strong dissent and a very tepid concurrence, this might be ripe for an en banc rehearing in the 6th Circuit,” Stoll said.
Indeed, the American Farm Bureau Federation and other industry groups opposed to the rule said it is “highly likely” that they will ask for the full Sixth Circuit comprised of 23 judges to review the ruling.
“We will have to evaluate our options and make that decision with counsel and the other members of our coalition,” Ellen Steen, farm bureau's general counsel, told Bloomberg BNA. “However, given the dissent and the separate concurring opinion, it seems highly likely that there will be a petition for rehearing en banc by one or more parties.”
Julia Anastasio, executive director of the Association of Clean Water Administrators, which represents state and interstate water pollution agencies, told Bloomberg BNA that the Sixth Circuit at least has resolved what the appropriate court is to hear the challenges and can get to the substantive questions over the rule.
“We are a long way from knowing the extent of federal v. state jurisdiction and the states are anxious to address that question,” Anastasio said, adding that she expects the courts will take longer than the four months to rule on the merits, considering it took four months to determine the venue.
“To me the venue question was the easier question for the courts. Wrestling with the final rule will be more challenging and probably take more time,” Anastasio said.
Jon Devine, an attorney with the Natural Resources Defense Council, agreed with Anastasio that the Sixth Circuit's decision will allow the court to rule on the merits rather than on procedure.
Vermont Law School Professor Patrick Parenteau said the decision was needed to move forward on the rule.
“To quote the late Antonin Scalia this decison is `jiggery pokery' if not `argle boggle,' ” Parenteau said. “But the decision makes all kinds of sense from the standpoint of practicality and judicial economy. Now EPA can litigate all the issues in one place at one time and get a decision fairly quickly.”
|Ohio v. U.S. Army Corps of Eng'rs (In re EPA and Dep't of Def. Final Rule), 6th Cir., No. 15-03799, 7/24/15||U.S. Judicial Panel for Multidistrict Litigation (No. 135) consolidated in the Sixth Circuit petitions challenging the EPA/corps rule clarifying CWA jurisdiction over waters and wetlands.||Divided Sixth Circuit ruled that it has jurisdiction to review petitions seeking review of the rule. Nationwide stay of the rule remains in effect.|
|Georgia v. McCarthy, 11th Cir., No. 15-14035, 9/10/15||Appeal of Southern District of Georgia ruling that the court of appeals has exclusive jurisdiction over challenges to the rule.||Held in abeyance pending Sixth Circuit decision.|
|Am. Expl. & Mining Ass'n v. EPA, D.C. Cir., No. 15-01411, 11/9/15||Prospecting, exploration and mining group asks the court to declare the rule violates the APA and Regulatory Flexibility Act and set it aside.||Case transferred to the Sixth Circuit.|
|Wash. Cattlemen's Ass'n v. EPA, 6th Cir., No. 15-04188, 10/30/15||Cattlemen's group representing Washington, California, and New Mexico, and wool growers in Arizona and New Mexico challenged the jurisdiction rule in the Eighth Circuit.||Case transferred to the Sixth Circuit.|
|Se. Stormwater Ass'n Inc. v. EPA, 6th Cir., No. 15-04159, 10/26/15||Southeast and Florida stormwater associations join Florida Rural Water Association and Florida League of Cities petition Sixth Circuit to review the rule.||Sixth Circuit has not set a briefing schedule.|
|Ariz. Mining Ass'n v. EPA, 9th Cir., 15-73378, 11/4/15||The state's mining, farming, livestock industries join the state chamber of commerce in challenging the rule, saying it will impose “staggering” burdens in compliance costs.||Case transferred to the Sixth Circuit.|
|North Dakota v. EPA, D.N.D., No. 15-00059, 6/29/15||District of North Dakota granted motion for preliminary junction, preventing rule from taking effect in 13 states.||Proceedings ongoing after court denied the agencies' motion to stay pending Sixth Circuit's decision on subject matter jurisdiction.|
|Ariz. Mining Ass'n. v. EPA, D. Ariz., No. 15-01752, 9/1/15||Southwestern mining and farming interests ask the District of Arizona to declare rule is unlawful and enjoin agencies from enforcing it.||District of Arizona stayed the case until Sixth Circuit issues its decision on jurisdiction; joint status report due 14 days after that decision.|
|Waterkeeper All. v. EPA, N.D. Cal., No. 15-03927, 8/27/15||Environmental groups allege agencies did not comply with NEPA, and rule improperly excludes groundwater, waste treatment systems.||Northern District of California stayed the case until Sixth Circuit issues its decision on jurisdiction.|
|Nat. Res. Def. Council v. EPA, D.D.C., No. 15-01324, 8/14/15||Environmental groups allege the rule improperly excludes waste treatment systems and waters traditionally regulated by the agencies.||District of the District of Columbia granted the agencies' motion to stay pending Sixth Circuit's decision on subject matter jurisdiction.|
|Se. Legal Found. V. EPA, N.D. Ga., No. 15-02488, 7/13/15||Georgia industry groups ask court to declare the rule unlawful and enjoin the agencies from enforcing it.||Parties to file status report within 10 days of Sixth Circuit's decision on subject matter jurisdiction.|
|Wash. Cattlemen's Ass'n v. EPA, D. Minn., No. 15-03058, 7/15/15||Complaint related to court of appeals challenge filed by cattlemen and wool growers in the court of appeals; allege rule exceeds constitutional authority, violates CWA, APA.||District of Minnesota granted the agencies' motion to stay pending Sixth Circuit's decision on subject matter jurisdiction.|
|Ohio v. EPA, S.D. Ohio, No. 15-02467, 6/29/15.||Ohio, Michigan and Tennessee ask the Southern District of Ohio to vacate the rule and enjoin the agencies from enforcing it.||Court did not rule on agencies' motion to stay pending Sixth Circuit's ruling on jurisdiction.|
|Oklahoma v. EPA, N.D. Okla., No. 15-00381, 7/8/15||Oklahoma asks the court to declare the rule unconstitutional and void and enjoin the agencies from enforcing it.||Northern District of Oklahoma did not rule on agencies' motion to stay pending Sixth Circuit's ruling on jurisdiction.|
|U.S. Chamber of Commerce v. EPA, N.D. Okla., No. 15-00386, 7/10/15||Chamber of Commerce asks the court to declare the rule unlawful, vacate it and enjoin the agencies from enforcing it.||Northern District of Oklahoma did not rule on agencies' motion to stay pending Sixth Circuit's ruling on jurisdiction.|
|Texas v. EPA, S.D. Tex., No. 15-00162, 6/29/15||Texas, Louisiana and Mississippi ask the Southern District of Texas to declare the rule unlawful and vacate it.||Court did not rule on motion to stay pending Sixth Circuit decision on jurisdiction.|
|Am. Farm Bureau Fed'n v. EPA, S.D. Tex., No. 15-00165, 7/2/15||Industry groups ask Southern District of Texas to declare the rule unlawful, vacate it and enjoin the agencies from enforcing it.||Court did not rule on motion to stay pending Sixth Circuit decision on jurisdiction.|
|Ass'n of Am. R.Rs. v. EPA, S.D. Tex., No. 15-00266, 9/22/15||Railroad groups ask Southern District of Texas to declare the rule unlawful, vacate it and enjoin the agencies from enforcing it.||Court did not rule on motion to stay pending Sixth Circuit decision on jurisdiction.|
|Puget Soundkeeper All. v. EPA, W.D. Wash, No. 15-01342, 8/20/15||Environmental groups allege the rule improperly excludes waste treatment systems and as well as farming, ranching and silviculture activities.||Western District of Washington granted the agencies' motion to stay pending Sixth Circuit decision on jurisdiction.|
|Se. Stormwater Ass'n v. EPA, N.D. Fla., No. 15-00579, 11/30/15||Southeast and Florida stormwater groups and Florida League of Cities allege procedural and substantive deficiencies and seek to enjoin the rule.||Northern District of Florida stayed the cased pending court of appeals' decisions on jurisdiction.|
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