WOTUS in the Supreme Court: NFIB Argues Suits Should be Heard in District Courts

Date: May 09, 2017

The Obama Administration finalized the controversial Waters of the United States (WOTUS) Rule in the summer of 2015. As we’ve explained previously, the WOTUS Rule purports to interpret the Clean Water Act’s jurisdictional provisions—but in the most expansive way possible. Since this would affect many previously unregulated properties, we’ve called the Rule an unprecedented regulatory land grab. And in conjunction with the U.S. Chamber of Commerce, we initiated a lawsuit in the Federal District Court for the Northern District of Oklahoma, where we had identified numerous affected members who were especially concerned that WOTUS would limit their ability to use and enjoy their lands.

But, we were not alone. Nearly every industry group in Washington sought to challenge the WOTUS Rule—filing separate lawsuits in the Federal District Courts where they had affected members. For example, the American Farm Bureau Federation and the National Association of Home Builders sued in a federal district court in Texas because that’s where they had identified affected members. Likewise, essentially half of the States joined in bringing their own legal actions to block the rule in local federal courts. For example, North Dakota helped score an early victory—leading a coalition of western states in a suit filed in the Federal District Court of North Dakota, where the judge issued an injunction.

Later a Federal Court of Appeal in Cincinnati would issue a nationwide injunction, which came as a major relief to small business owners from coast-to-coast. But while that was a blow to the Environmental Protection Agency and Army Corps of Engineers, the Obama Administration was ultimately banking on this Court of Appeals (the “Sixth Circuit”). Rather than defending the WOTUS Rule in separate district court cases throughout the country (as is the usual course), EPA and Army Corps wanted to have the Sixth Circuit decide all of the legal issues presented in a single blockbuster case that would be binding on all Americans.

Accordingly, the Administration argued that special provisions of the Clean Water Act vested the Sixth Circuit Court of Appeals with exclusive jurisdiction to hear any challenge to the WOTUS Rule. And the Sixth Circuit agreed. But this was a deeply flawed decision. In fact, the three judge panel could not even agree on a principled rationale for why these cases should be heard in the Sixth Circuit—as opposed to in the lower district courts where NFIB (and virtually everyone else) had filed suit.

As far we were concerned the Sixth Circuit was simply wrong. EPA and Army Corps were manipulating the statutory text to have their case heard in the court of their choosing—just like they were manipulating the statutory text to advance the Obama Administration’s environmental agenda. As such, we continued with our lawsuit in the Northern District of Oklahoma; however, that Court dismissed our action—perfunctorily concluding that the Sixth Circuit has exclusive jurisdiction over all legal challenges to WOTUS without any analysis, and without even allowing us an opportunity for a single hearing. In turn, we appealed to the Federal Court of Appeal for the Tenth Circuit in Denver, where we argued, emphatically, that the district court had an obligation to decide for itself whether it had jurisdiction over our case; we also argued that it was inappropriate to automatically defer to the judgment of the Sixth Circuit because it was not binding in the Tenth Circuit.

But now—after months and months of litigation over where our suit should be heard—the U.S. Supreme Court has intervened to decide the issue once and for all. As ever, we maintain that this is important because these lawsuits should really be heard in the local federal district courts close to the affected landowners. That is especially true given that the WOTUS rule affects landowners in different regions differently. For example, a judge sitting in Cincinnati may not fully appreciate how his or her decision may affect properties in Oklahoma and other arid western states, where topographical conditions are necessarily distinct from conditions in the Ohio Valley.

Moreover, there are significant concerns that, if EPA and Army Corp prevail, the result may prevent landowners from ever questioning the legality of the WOTUS Rule in future proceedings—even where they are subject to enforcement actions for alleged violations. Obviously that would raise serious due process problems, which is all the more reason why we think the Supreme Court should affirm that WOTUS challenges may be raised in the local federal district courts. (For more thoughts on this pending case in the Supreme Court, check out Professor Jonathan Adler’s commentary at Volokh Conspiracy).

But while we wait for the Supreme Court to clarify these questions, the Trump Administration is currently working to revise the WOTUS Rule. Our hope is that EPA and Army Corps will soon release a new rule that defines Clean Water Act jurisdiction much more narrowly—consistent with the Supreme Court’s 2005 decision in Rapanos v. United States. Suffice it to say, we may be tied-up fighting to limit Clean Water Act jurisdiction for quite a while longer, regardless of what the Supreme Court says on the present issue. To be sure, we can expect environmental activists to bring the next round of lawsuits challenging the Trump Administration’s efforts to dismantle the WOTUS Rule.

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