National Association of Manufacturers v. Department of Defense

Issues 

Do federal district courts have broader jurisdiction under 33 U.S.C 1369(b)(1) over challenges to rules promulgated under the Clean Water Act than that statute expressly enumerates?

Oral argument: 
October 11, 2017

This case presents the Supreme Court with the opportunity to review whether the Clean Water Act grants broad original and exclusive jurisdiction to the United States Courts of Appeals. Under the Administrative Procedure Act, agency actions are judicially reviewable by the federal district courts unless otherwise provided by congressional statute. One such provision—Section 1369(b) of the Clean Water Act—enumerates classes of agency actions that are originally and exclusively reviewable by the Courts of Appeals. In June 2015, the U.S. Army Corps of Engineers and the U.S. Environmental Protection Agency jointly adopted a new rule redefining the phrase “waters of the United States.” The National Association of Manufacturers argues that challenges to this rule fall outside of the classes enumerated in Section 1369(b) and thus are not directly reviewable by the Courts of Appeals. The Department of Defense and U.S. Environmental Protection Agency, on the other hand, argue that Section 1369(b) should be read broadly and functionally as to include the rule. The outcome of this case will implicate judicial efficiency and thoroughness concerns.

Questions as Framed for the Court by the Parties 

Whether the United States Court of Appeals has original jurisdiction under 33 U.S.C. 1369(b)(1) over a petition for review challenging a regulation that defines the scope of the term “waters of the United States” in the Clean Water Act. 

Facts 

In June 2015, the U.S. Army Corps of Engineers and the U.S. Environmental Protection Agency (“EPA”) jointly adopted the “Waters of the United States” Rule (“WOTUS Rule”) as published in the “Clean Water Rule.” See In re U.S. Dep’t of Def. et al., 817 F.3d 261, 264 (6th Cir. 2016); Brief for Petitioner, National Association of Manufacturers (“NAM”) at 2.  This rule, among other things, amended the regulatory definition of the term “waters of the United States” as used in the Clean Water Act. See In re U.S Dep’t of Def., 817 F.3d at 264. It delineated three categories of waters: (1) ones always under the United States’ jurisdiction; (2) ones never under the United States’ jurisdiction; and (3) ones that should be subject to a case-specific analysis to determine their jurisdictional status. See Brief for Petitioner, at 11. It also added clearer boundaries for which tributaries adjacent to navigable waters fall within federal jurisdiction. See In re U.S Dep’t of Def., 817 F.3d at 264.

After the WOTUS Rule’s issuance, multiple parties challenged its validity in federal district court, contending that the amendment to the regulatory definition of “waters of the United States” substantially expanded the federal government’s jurisdiction and disrupted the balance between federal and state regulation. See id. They also challenged the boundaries regarding tributaries as inconsistent with both Supreme Court precedent and the Administrative Procedure Act. See id.

These parties were consolidated in the United States Court of Appeals for the Sixth Circuit, and the National Association of Manufacturers (“NAM”), a non-profit advocacy group, intervened in the case. See id. at 264–65; Brief for Petitioner, at iii, vi. The court issued a nationwide stay of the rule in October 2015. See In re U.S Dep’t of Def., 817 F.3d at 264–65. In response, the parties filed eight motions to dismiss for lack of subject-matter jurisdiction. See id. at 265. The motions asserted that judicial review was properly held by the federal district courts—not the Sixth Circuit—as the challenges to the WOTUS Rule did not come within the judicial review provisions of the Clean Water Act. See id.

The Department of Defense and U.S. Environmental Protection Agency (“DOD and EPA”) responded by arguing that Section 1369(b)(1) of the Clean Water Act specifies seven types of agency actions that are directly and exclusively reviewable by the circuit courts. See id. Specifically, they cited subsections (E) and (F) of Section 1369(b)(1), which respectively provide that the circuit courts have exclusive, original jurisdiction over challenges to agency actions limiting discharges of pollutants into bodies of water and over agency actions involving federal permits for discharging pollutants. See id. All challenges not covered by Section 1369(b)(1) are governed by the Administrative Procedure Act, which provides that challenges to agency action may be brought in district court. See Brief for Respondents, Federal Respondents, at 5–6.  

The Sixth Circuit concluded in a 1–1–1 decision that it had jurisdiction to hear challenges to the rule. See Brief for Petitioner, at 14. The panel of judges agreed Subsection (E) or (F) were the only two subsections that could potentially apply, but otherwise disagreed. See id. at 14. The lead opinion recognized that, while the WOTUS Rule did not explicitly approve or promulgate any of Subsection (E)’s specified limitations and did not issue or deny any permits, precedent allowed the court to analyze Section 1369(b)(1) through a functional lens. See id. at 14–15. It concluded that, because the rule would indirectly create limitations and affect permits, challenges to the rule would fall under both Subsection (E) and (F). See id. The dissent contended that precedent would not allow the Court to go beyond the plain text of Subsection (E) or (F), and so would not allow the court to review the challenges. See id. at 16.

The NAM filed for rehearing en banc, which was denied in April 2016. See Brief for Federal Respondents at 1. The Supreme Court granted certiorari in January 2017. See Brief for Petitioner at 2. In March 2017, the DOD and EPA asked the Supreme Court to postpone briefing and argument of the case, pending the outcome of the Trump administration’s efforts to revise the WOTUS Rule. Motion of Federal Respondents to Hold Briefing in Abeyance, at 1–2. The Court denied this motion on April 3, 2017, and later schedule the case for oral argument. See US Dkt 16-299 at Mar. 06, 2017 & Apr. 03, 2017.

Analysis 

THE TEXT OF SECTION 1369(B)(1)(E) OF THE CLEAN WATER ACT

The National Association of Manufacturers (“NAM”) argues that the WOTUS Rule falls outside the plain language of Section 1369(b)(1)(E) and thus, that Section does not confer jurisdiction on the United States Court of Appeals in this case. See Brief for Petitioner, NAM at 55. The NAM contends that Section 1369(b)(1)(E) grants original jurisdiction to the Court of Appeals to review EPA actions only when the agency “approv[es] or promulgat[es] any effluent limitation or other limitation” under Sections 1311, 1312, 1316, or 1345 of the Clean Water Act. See id. The NAM notes that both sides agree that the WOTUS Rule is neither an “effluent limitation” nor an “other limitation” under Sections 1312, 1316, or 1345. See id. If Section 1369(b)(1)(E) grants original jurisdiction to the Court of Appeals, according to the NAM, it must be an “other limitation” under Section 1311. See id. But the NAM asserts that the WOTUS Rule cannot be an “other limitation” under Section 1311 because it imposes no restriction or limitation. See id. at 29. Rather, the NAM posits, the WOTUS Rule merely defines the jurisdictional reach of a pre-existing limitation. See id. Furthermore, the NAM argues that the WOTUS Rule falls outside Section 1311 because the phrase “waters of the United States” cannot be found in Section 1311 and, rather, appear in the Clean Water Act’s definitional section (Section 1362) and is used throughout the Act. See id. at 32. Thus, the NAM maintains that the Rule—a clarification of a definition that applies broadly to the Clean Water Act as a whole—does not “emanate” from or bear a special relationship to the Sections identified in 1369(b)(1)(E) and therefore should not be read to constitute an EPA action pursuant to those Sections. See id. at 32–34.

The Department of Defense and U.S. Environmental Protection Agency (“DOD and EPA”), on the other hand, argue that the WOTUS Rule is reviewable under Section 1369(b)(1)(E), thus conferring jurisdiction on the United States Court of Appeals in this case. See Brief for Respondents, Federal Respondents at 17. The DOD and EPA assert that Section 1369(b)(1)(E) covers all EPA actions that impose any limitation under Section 1311. See id. Congress’s decision to use “any” in both Section 1369(b)(1)(E)’s identification of the limitations and the Clean Water Act’s definition of “effluent limitation” in Section 1362, according to the DOD and EPA, lends support for Section 1369(b)(1)(E)’s broad coverage. See id. at 18. Furthermore, the DOD and EPA dispute the NAM’s contention that the WOTUS Rule is not a limitation, reasoning that a rule defining the jurisdictional reach of Section 1311 limitations affects regulated parties just as much as other requirements for Section 1311 limitations. See id. at 19. Additionally, the DOD and EPA note that the WOTUS Rule imposes limitations on permitting authorities by requiring them to apply the Section 1311 limitations to discharges in “waters of the United States” that did not previously fall under the automatic jurisdiction of Section 1311. See id. at 20. The DOD and EPA note that the WOTUS Rule need not be self-executing in order to constitute a limitation under the Clean Water Act, because judicial review under Section 1369(b)(1)(E) extends beyond “direct and freestanding” limitations to include “any effluent limitation or other limitation.” See id. at 23. Further, the DOD and EPA contend that the definitional nature of the WOTUS Rule does not prevent it from being classified as a limitation under Section 1311, which makes Section 1369(b)(1)(E) applicable. See id. at 28–29.

THE TEXT OF SECTION 1369(B)(1)(F) OF THE CLEAN WATER ACT

The NAM argues that the WOTUS Rule also falls outside the plain language of Section 1369(b)(1)(F) and thus, that Section does not confer jurisdiction on the Court of Appeals in this case. See Brief for Petitioner at 20. The NAM contends that Section 1369(b)(1)(F) grants original jurisdiction to the Court of Appeals to review EPA actions only when the agency “issuing or denying any [National Pollutant Discharge Elimination System (“NPDES”)] permit” under Section 1342. See id. The NAM notes that both sides agree that the WOTUS Rule does not issue or deny a Section 1342 permit and that the Sixth Circuit panel unanimously agreed on this point. See id. at 21. Thus, according to the NAM, Section 1369(b)(1)(F), on its face, does not apply, and this should end the analysis. See id. at 21–22. Responding to the DOD and EPA’s argument that Section 1369(b)(1)(F) covers any EPA action that “impacts the granting and denying of permits” by virtue of the Supreme Court’s decision in Crown Simpson Pulp Co. v. Costle, the NAM asserts that the Court’s narrow language on the “functional similarity” of EPA actions in Crown Simpson does not authorize Section 1369(b)(1)(F) to apply to any regulation relating to permits. See id. at 22–24. The NAM notes that the permit veto at issue in Crown Simpson is different from the WOTUS Rule in this case because the WOTUS Rule does not deny NPDES permits but rather defines the jurisdictional reach of the Clean Water Act. See id. at 24. Expanding Section 1369(b)(1)(F) to cover any EPA action affecting permitting, according to the NAM, would violate the rules of statutory interpretation and improperly confer original jurisdiction on the Court of Appeals for matters related to the Clean Water Act. See id. at 25.

The DOD and EPA, on the other hand, argue that the WOTUS Rule is reviewable under Section 1369(b)(1)(F), thus conferring jurisdiction on the United States Court of Appeals in this case. See Brief for Federal Respondents at 30. The DOD and EPA assert that the Court’s Crown Simpson precedent renders the WOTUS Rule judicially reviewable under Section 1369(b)(1)(F). See id. at 31. The Supreme Court in Crown Simpson, according to the DOD and EPA, followed a “functional interpretive approach” and rejected a “seemingly irrational bifurcated system” in which one level of the federal court system review denials of NPDES permits while another level of the federal court system reviewed “functionally similar” actions. See id. at 30–31. Thus, the DOD and EPA contend that if the Court of Appeals has original jurisdiction over EPA actions “issuing or denying any permit” under Section 1369(b)(1)(F), the Court of Appeals must also have original jurisdiction over the WOTUS because it controls whether permits are issued. See id. at 31. To hold otherwise, the DOD and EPA argue, would violate the principles of Crown Simpson and create an impermissible, “seemingly irrational bifurcated system.” See id. at 32.

THE STRUCTURE AND PURPOSE OF SECTION 1369(B) OF THE CLEAN WATER ACT

The NAM argues that Congress “drafted seven carefully defined bases” in Section 1369(b)(1) in which the Court of Appeals retains original jurisdiction and that the WOTUS Rule falls into none of the seven bases. See Brief for Petitioner at 40. The NAM further asserts that Section 1369(b) should be interpreted narrowly because Congress could have conferred broad original jurisdiction on the Court of Appeals but chose not to do so. See id. at 40. As an example, the NAM contrasts the Clean Air Act’s authorization of Court of Appeals review for broad categories of EPA action with the absence of such authorization in the Clean Water Act. See id. at 41. This difference in authorization, the NAM reasons, indicates that Congress intended Section 1369(b) to be construed narrowly and to only grant jurisdiction to the Court of Appeals for the specifically enumerated classes of EPA action. See id. Because the WOTUS Rule does not fall within a narrow construction of Section 1369(b), the NAM contends, it falls under the process of judicial review of agency action set forth in the Administrative Procedure Act.

The DOD and EPA argue that the narrow reading of Section 1369(b) championed by the NAM does not comport with the provision’s purpose. See Brief for Federal Respondents at 35. Conferring exclusive original jurisdiction on the Court of Appeals, according to the DOD and EPA, creates a system in which disputes are resolved in an “orderly” manner and “through the same channels.” See id. The DOD and EPA not only reason that a narrow reading of Section 1369(b) violates the principles of Crown Simpson, but they also note that denying original jurisdiction to the Court of Appeals would create a “truly perverse situation” in which the Court of Appeals would review individual EPA actions but not the underlying regulations governing those actions. See id. at 36. In E.I. du Pont de Nemours & Co. v. Train, according the DOD and EPA, the Court rejected a reading of Section 1369(b) that produced such a situation. See id. The DOD and EPA contend that the NAM does not persuasively reconcile its proposed narrow reading of Section 1369(b) with the interpretive principles set forth by the Supreme Court in Crown Simpson and E.I. du Pont and that adopting the NAM’s reading would disregard a “substantial body of case law.” See id. at 39–40.

Discussion 

FULL CONSIDERATION VERSUS NATIONAL UNIFORMITY AND EFFICIENCY

The Chamber of Commerce of the United States et al., (“Chamber of Commerce”), in support of the NAM, contends that the NAM’s plain-meaning interpretation of Section 1369(b)(1) of the Clean Water Act guarantees that EPA-related actions with national implications—like the WOTUS Rule—receive rigorous scrutiny by the district courts before higher courts issue binding decisions. See Brief of Amici Curiae Chamber of Commerce of the United States et al., in support of Petitioner at 18, 22–23. Therefore, the Chamber of Commerce argues that expanding Section 1369(b)(1)’s scope by conferring original jurisdiction for such agency actions to the Courts of Appeals would interrupt the judicial system’s ability to fully consider and debate important questions of agency law. See id. at 23. Additionally, the NAM asserts that the Sixth Circuit’s functionalist reading of Section 1369(b)(1) will generate duplicative filing by encouraging cautious attorneys to file in both federal district courts and Courts of Appeals. See Brief for Petitioner, NAM at 44–48.

The DOD and EPA, however, argue that Congress enacted Section 1369(b)(1) for the express purpose of providing fast, Court of Appeals review that would prevent prolonged uncertainty and conflicting lower court decisions. See Brief for Federal Respondents, at 18–19. Given this purpose, the DOD and EPA assert, a functional analysis of Section 1369(b)(1) would better achieve Congress’s goals by allowing all challenges to national actions and rules to be resolved promptly and efficiently. See id. at 14. Moreover, the DOD and EPA claim that allowing district courts more power to review agency-related regulations would generate inconsistent decisions initially and on appeal. See id. The DOD and EPA note the importance of national uniformity in interpretations of broad agency regulations. See id. at 35. They also reason that a plain-text reading would waste judicial resources and create duplicative, unnecessary litigation in separate district courts. See id. at 14.

PLAIN READING AND JUDICIAL UNCERTAINTY

The Chamber of Commerce also argues that a plain-meaning interpretation of Section 1369(b)(1) satisfies the Supreme Court’s preference for straightforward, applicable jurisdictional rules. See Brief of Chamber of Commerce, at 21. The Chamber of Commerce contends that interpreting Section 1369(b)(1) as broadly as the DOD and EPA request will create vague boundaries on jurisdictional rules, which is exactly what the Supreme Court has cautioned against. See id. The Chamber of Commerce also states that because the Sixth Circuit’s functional approach is more complex than a plain reading of the statute, it will waste time and money by demanding litigation over which forum is appropriate. See id. The Chamber of Commerce asserts that this waste is illustrated by the current litigation over the WOTUS Rule. See id.

However, the Natural Resources Defense Council et al. (“NRDC”), in support of the DOD and EPA, argues that a plain-meaning reading of Section 1369(b)(1) does not actually provide clarity, as it relies on ambiguous language such as Subsection (E)’s description of “effluent-like limitations.” See Brief of Respondents Natural Resources Defense Council (“NRDC”) and National Wildlife Federation (“NWF”), in support of Respondents at 27–28.  Because the statute’s language is unclear, NRDC argues that relying on the plain text alone will not generate jurisdictional clarity. See id.

FILING CONCERNS FOR LITIGANTS CHALLENGING AGENCY ACTION

Section 1369(b)(1) mandates that cases requiring initial review in the Court of Appeals be brought within 120 days of the challenged agency action’s issuance. See Brief of Chamber of Commerce at 18–19. After this period has ended, Section 1369(b)(2) bars review of the challenged action in any other “civil or criminal proceeding.” See id.

The Chamber of Commerce cautions that broadening the scope of agency actions that fall under Section 1369(b)(1) could jeopardize the ability of individuals and small businesses to challenge the legality of broad agency actions due to the strict timeline for bringing appeals under the Section. See id. This concern, the Chamber of Commerce reasons, implicates due process rights, especially when such parties are defendants against agency enforcement. See id. at 20.

The DOD and EPA, however, argue that requiring challenges to the EPA’s actions enumerated in Section 1369(b)(1) to be brought within 120 days ensures efficient resolution of challenges to the legality of important regulatory rules. See Brief for Federal Respondents at 35. If the WOTUS Rule was not found to fall under Section 1369(b)(1), the DOD and EPA contend, the purpose of the expedited review timeline would be seriously undercut. See id. at 35–36

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