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Unanimous Supreme Court Smacks EPA, 9th Circus…Again

Michael and Chantell Sackett bought some land in Idaho, intending on building a home there.  After getting all the requisite permits and beginning the work in 2007, the EPA swooped in, called the Sacketts’ property wetlands, subject to federal regulation under the Clean Water Act, and put a halt to the work.  Worse, the EPA said the Sacketts couldn’t go through the courts because the Clean Water Act didn’t allow for it until the EPA was done making the Sacketts’ lives more miserable. This included charging the Sacketts up to $75,000 per day in fines; at this point, the Sacketts would have been fined around $100 million.  The U.S. District Court in Idaho agreed (a G. H. W. Bush appointee), as did a unanimous panel of the 9th Circuit Court of Appeals (a Reagan appointee and two Clinton appointees). Yesterday, a unanimous Supreme Court overruled all of them, saying the EPA had made a final ruling and it was time for the Sacketts to have their day in court. Justice Scalia wrote the majority opinion, and Justices Ginsburg and Alito each wrote a concurring opinion.

Let’s dispense with what this ruling isn’t; it is not a ruling on the merits of the Sacketts’ claim, a ruling throwing out the Clean Water Act, and it does not allow the Sacketts to start building their home. What the ruling clarifies is when a petitioner can have their day in court against the EPA under the Administrative Procedure Act (APA).

The EPA claimed that per the Clean Water Act, via procedures that could take years to complete, they could shut down a project until such time as the agency issued a final agency action that either deemed a project ready to begin or if the agency sued a project’s sponsor(s), in this case the Sacketts. If this looks to you like a complete abandonment of due process, then you’re not alone since you’d be in agreement with how Alito sees it:

Any piece of land that is wet at least part of the year is in danger of being classified by EPA employees as wetlands covered by the Act, and according to the Federal Government, if property owners begin to construct a home on alot that the agency thinks possesses the requisite wetness, the property owners are at the agency’s mercy. The EPA may issue a compliance order demanding that the owners cease construction, engage in expensive remedial measures, and abandon any use of the property. If the owners do not do the EPA’s bidding, they may be fined up to $75,000 per day ($37,500 for violating the Act and another $37,500 for violating the compliance order). And if the owners want their day in court to show that their lot does not include covered wetlands, well, as a practical matter, that is just too bad. Until the EPA sues them, they are blocked from access to the courts, and the EPA may wait as long as it wants before deciding to sue. By that time, the potential fines may easily have reached millions. In a nation that values due process, not to mention private property, such treatment is unthinkable.

As I mentioned in the opening, the Sacketts are looking at potential fines of around $100 million.

Basically, the EPA said they weren’t done with the Sacketts. The Supreme Court said otherwise. Justice Ginsburg:

The Court holds that the Sacketts may immediately litigate their jurisdictional challenge in federal court. I agree, for the Agency has ruled definitively on that question.

Justice Scalia explains further:

We conclude that the compliance order in this case is final agency action for which there is no adequate remedy other than APA review, and that the Clean Water Act does not preclude that review.

Scalia echoes Marbury v. Madison (in my opinion), exhibiting an inner John Marshall:

The Government warns that the EPA is less likely to use the orders if they are subject to judicial review. That may be true—but it will be true for all agency actions subjected to judicial review. The APA’s presumption of judicial review is a repudiation of the principle that efficiency of regulation conquers all. And there is no reason to think that the Clean Water Act was uniquely designed to enable the strong-arming of regulated parties into “voluntary compliance” without the opportunity for judicial review—even judicial review of the question whether the regulated party is within the EPA’s jurisdiction.

Justice Alito goes even further in the penultimate paragraph of his concurring opinion, stating that Congress has put off for too long work it must do [emphasis from original]:

Real relief requires Congress to do what it should have done in the first place: provide a reasonably clear rule regarding the reach of the Clean Water Act. When Congress passed the Clean Water Act in 1972, it provided that the Act covers “the waters of the United States.” 33 U. S. C. §1362(7). But Congress did not define what it meant by “the waters of the United States”; the phrase was not a term of art with a known meaning; and the words themselves are hopelessly indeterminate. Unsurprisingly, the EPA and the Army Corps of Engineers interpreted the phrase as an essentially limitless grant of authority. We rejected that boundless view, see Rapanos v. United States, 547 U. S. 715, 732–739 (2006) (plurality opinion); Solid Waste Agency of Northern Cook Cty. v. Army Corps of Engineers, 531 U. S. 159, 167–174 (2001),but the precise reach of the Act remains unclear. For 40 years, Congress has done nothing to resolve this critical ambiguity, and the EPA has not seen fit to promulgate a rule providing a clear and sufficiently limited definition of the phrase. Instead, the agency has relied on informal guidance. But far from providing clarity and predictability, the agency’s latest informal guidance advises property owners that many jurisdictional determinations concerning wetlands can only be made on a case-by-case basis by EPA field staff. See Brief for Competitive Enterprise Institute as Amicus Curiae 7–13.

So now the Sacketts will have their day in federal court with a jury to decide whether or not the Sacketts can begin building their house. Their travails are not yet over; but at least with yesterday’s ruling, they can proceed.

Cross-posted at Scipio the Metalcon.

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