NFIB Urges Supreme Court to Shield Small Businesses from Duplicative and Costly Litigation

Date: March 06, 2023

Dakota Finance LLC v. Naturaland Trust concerns citizen suits under Clean Water Act

WASHINGTON, D.C. (March 6, 2023)NFIB filed an amicus brief supporting a petition for a writ of certiorari at the U.S. Supreme Court in the case Dakota Finance LLC v. Naturaland Trust. The case questions what the proper test is for determining whether the “diligent prosecution bar” precludes citizen suits brought under the Clean Water Act.

“Small business property owners routinely assess the requirements of environmental laws and regulations, including the Clean Water Act,” said Beth Milito, Executive Director of NFIB’s Small Business Legal Center. “This case highlights the loopholes in the dual-enforcement scheme of the Clean Water Act, where both private and government actors can seek penalties for an alleged violation, even those made without bad faith. The Court should reject the Fourth Circuit’s approach and shield small businesses and property owners from duplicative and costly litigation.”

The case concerns a South Carolina small business that allegedly failed to get needed permits under the Clean Water Act (CWA). After state regulators inspected the property and sent a notice of alleged violations, environmental groups filed a citizen suit alleging CWA violations.

CWA citizen suits are preempted whenever a state has commenced and is diligently prosecuting an action under state law comparable to the enforcement subsection of the CWA. Congress specifically enacted guardrails against citizen suits duplicating already existing state enforcement proceedings.

NFIB filed the brief with the National Association of Home Builders, the American Farm Bureau Federation, the National Apartment Association, and the Associated General Contractors of America.

The NFIB Small Business Legal Center protects the rights of small business owners in the nation’s courts. NFIB is currently active in more than 40 cases in federal and state courts across the country and in the U.S. Supreme Court.

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