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SCOTUS Sends WOTUS Back TO District Courts

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by Patrick J. Paul

On January 22, 2018, in National Association of Manufacturers v. Department of Defense, the United States Supreme Court held unanimously that challenges to the federal Clean Water Act’s 2015 Waters of the United States (WOTUS) Rule should be adjudicated at the federal District Court level and not the appellate level, the venue preferred by the executive branch.

The WOTUS Rule gave rise to a flurry of legal activity (a history of the WOTUS Rule may be found here), including the one at issue by the National Association of Manufacturers (NAM), to challenge the regulation in federal court.  The Supreme Court’s decision, however, did not address the sub­stantive challenges to the WOTUS Rule but rather the proper venue in which those challenges must be adjudicated.

The CWA allows two avenues of judicial review of EPA action — one via the District Courts under the Administrative Procedure Act (APA) and another via the federal Court of Appeals, but requiring that such actions fall within one of seven categories of agency action.   The Government maintained that the WOTUS Rule fit within two such categories, namely: (1) EPA actions in approving or promulgating any effluent limitation or other limitation, and (2) EPA actions in issuing or denying any permit under CWA Section 1342.

A unanimous Supreme Court disagreed and determined that the WOTUS Rule fell outside the ambit of these categories and that any challenges therefore must be filed in federal District Courts.

While acknowledging that routing WOTUS Rule challenges directly to the Court of Appeals could, as the Government maintained, improve judicial efficiency, the Court noted that efficiency was not Con­gress’ only consideration and observed that Congress could have authorized direct circuit-court review of all nationally applicable regulations, as it did under the Clean Air Act.

The Court’s decision is a setback to the Trump administration’s efforts to repeal and replace WOTUS.  Several District Court cases which had been stayed may now resume though the federal government’s defense will surely be different.

EPA and the Army Corps have proposed two regulations intended to stymie WOTUS — the first a flat repeal and the second, proposed in December 2017, effectively delaying enforcement until 2020.  Neither has yet been finalized.

For the moment, confusion again reigns within the regulated community.  It seems unlikely that the Sixth Circuit stay can remain if no jurisdiction existed in the first place.  Further, as we previously reported, a 2015 North Dakota District Court decision already halted implementation of WOTUS in thirteen western states including Arizona.  While a nationwide injunction from a District Court on WOTUS implementation might be welcomed by the Trump administration, it would run counter to its opposition to such injunctions particularly in the immigration realm.

Stay tuned.