January 04, 2012

In Sackett v. EPA, Troubling Potential for SCOTUS to Undermine Government's Ability to Promptly Respond to Environmental Threats

On January 9th, the Supreme Court will hear Sackett v. EPA, which concerns whether an individual has a right to a judicial hearing before, rather than after, an agency finalizes a so-called administrative compliance order.  The case has important potential to undermine the environmental protection, including the government’s ability to promptly respond to environmental threats such as factory outfalls leaking pollutants into rivers. 

The lawsuit involves an Idaho couple, Chantell and Mike Sackett, with a .63 acre property overlooking Priest Lake, Idaho. The Sacketts cleared and filled about a half acre of the property with gravel to ready it for building a house.  EPA officials discovered the fill and notified the couple that they had filled a “jurisdictional wetland,” meaning a wetland covered by the federal Clean Water Act.  (Mike Sackett has publicly stated that although the property could get “wet” in the spring, it was not, in his view, a wetland.)  EPA issued a so-called Administrative Compliance Order directing the couple to remove the fill and replace the vegetation they had cleared.  If EPA follows up the order with a judicial enforcement action and a judge agrees that the Sacketts violated the Clean Water Act, the trial court could impose civil penalties of up to $37,500 for each day the Sacketts were not in compliance.  The exact amount of penalties would be up to the trial court, considering factors such as the Sacketts’ good faith in complying with the Act, the seriousness of the violation, and “such other matters as justice may require.”  A court could also agree with the Sacketts that they did not violate the Clean Water Act, find the order invalid, and dismiss EPA’s lawsuit outright.  The Sacketts do not wish to wait for EPA to seek civil penalties to have a court hear their arguments, however.  What they seek is judicial review prior to EPA’s issuing the Administrative Compliance Order. 

How can this case be understood?  At first blush, it sounds like mom-and-pop property owners being pushed around by an overbearing federal agency, which refuses even to provide the agency hearing the Sacketts want.  And the government’s case has some weaknesses.  For example, the EPA order reportedly not only calls for removal of the fill and replanting, but also 3 years of monitoring, which could delay the Sacketts from doing anything further on their property. 

On the other hand, Mike Sackett owns an Idaho contracting and excavating company.  It seems most unlikely that the existence of federal wetlands regulation, which restricts excavating and filling wetlands, was a surprise to the Sacketts.  In fact, their parcel is listed on the federal National Wetlands Inventory.  A regional newspaper reported that cattails border the property, and that directly across the road there are fields with pools of water and a beaver dam.  Meanwhile, the EPA says the Sacketts were repeatedly invited to discuss the terms of the compliance order, but never responded.  Another possible understanding of the events:  a property owner engaged in a “catch me if you can” or “build now, apologize later,” strategy – one with real environmental consequences.  A federal agency would be understandably anxious to deter this sort of tactic.

The Supreme Court agreed to hear two issues:  first, whether the Clean Water Act or another act broadly governing federal agencies, the Administrative Procedure Act, entitled the Sacketts to so-called pre-enforcement judicial review – review by a court of the EPA’s charge that the Sacketts violated the Clean Water Act, along with the terms of the proposed compliance order, before EPA finalized that order with respect to the Sacketts.  The second issue is whether the Constitution’s due process clause entitled them to that pre-enforcement judicial hearing. 

What is at stake here is not only the Sacketts’ hearing rights, but the effectiveness of the EPA’s administrative order powers.  These are critical to whether the government can promptly address environmental threats.  The Clean Water Act authorities are not novel.  The EPA has similar powers to address violations of the Clean Air Act, the Resource Conservation and Recovery Act, and the Superfund hazardous waste contamination law (also known as CERCLA). A filled wetland may not appear to present the same sorts of environmental threats as, say, leaking barrels of hazardous waste.  But the six federal agencies that have significant environmental responsibilities (EPA and others) have continually reiterated the federal commitment to “no net loss” of wetlands.  This is because wetlands serve critical environmental functions, including filtering out metals and nutrients that threaten nearby waterways, such as the relatively pristine Priest Lake.  And the Clean Water Act compliance order powers are also needed for EPA to respond quickly to other urgent threats to water quality, including leaking factory outfalls, overflowing lagoons at concentrated animal feeding operations, and malfunctioning sewage treatment plants. (Of course, the Sacketts surely are more sympathetic defendants).  EPA can obtain penalties and injunctive relief if it brings a lawsuit, but the administrative compliance order is faster.  It puts entities on prompt notice of the problem and what EPA believes necessary to fix it.   If the Court holds that the Sacketts are entitled to pre-enforcement judicial review, the Sackett case will limit the usefulness of compliance orders, since that review process can be time-consuming.  Indeed, enabling swift corrective action is one reason why Congress put the authority in the Act in 1972. 

The question whether the Clean Water Act entitles the Sacketts to get early review of the administrative order is a close one.  For example, Congress has expressly barred pre-enforcement review of these sorts of orders in other statutes, such as in the Superfund law, but not in the Clean Water Act.  That could imply that the Clean Water Act allows the review the Sacketts seek. On the other hand, the statute provides that if EPA detects a Clean Water Act violation, the agency can either file a judicial enforcement action or issue an administrative compliance order.  That suggests no pre-enforcement review of administrative orders, since that would put the agency in a situation little different from filing a judicial enforcement action.  And as noted, Congress’s wish for swift corrective action is one reason why administrative order authority was included in the Act.  Given the importance of the compliance order authority to the water quality goals of the Clean Water Act, the Court ought to interpret the Clean Water Act to preserve the order power without forcing the agency to go to court first.  And if it doesn’t, Congress should amend the Clean Water Act to make clear that review of the content of an administrative order should wait until the agency brings a judicial enforcement action.  The Sacketts will still be protected by the right to a judicial hearing before any penalties can be assessed for noncompliance with the order.

If the Court were to reach the constitutional question and find that the Due Process Clause required pre-enforcement judicial review, that would preclude Congress from expressly barring such judicial actions, as it has in the Superfund law.  But that seems unlikely.  The Court ruled in Thunder Basin Coal v. Reich (1994) that due process is not violated by the prospect of penalties in a lawsuit for not complying with an agency order, as long as the party subject to the order can avoid penalties by arguing – as the Sacketts can in this case – that it has not violated the law.  Moreover, the Court last year declined to hear similar arguments regarding EPA’s administrative order authority under the Superfund law, in which the potential exposure to penalties and treble damages in court for noncompliance is far greater than penalty exposure under the Clean Water Act.  Finally, even when the Court has found that due process requires an early hearing, it has generally not required that hearing to be in front of a judge.  For example, the Court, decades ago, found that agency hearings are adequate to protect individuals from the government’s mistakenly terminating their disability or veterans’ benefits, and it is unlikely to wish to expand the process due those individuals.

If EPA wins the Sackett case, it nonetheless might prompt the agency to consider improving its process, at least in the nonemergency setting.  By rule, EPA could provide recipients of Clean Water Act compliance orders a slightly more formal opportunity to be heard in front of the agency, perhaps an explanation of the agency’s evidence and an opportunity for defendants to present information and arguments to an agency supervisor not directly involved in issuing the order.  Agency hearings are required under RCRA, for example.  That would permit the Sacketts to present their arguments to EPA that, for example, their parcel may not have included a federally protected wetland.  That could increase confidence in the process with fairly little cost and only a short delay in corrective action. 

In short, a decision against EPA in the Sackett case could significantly undermine the government’s ability to protect our waterbodies from pollution.  Depending how far the Court’s reasoning were to extend, it could also threaten the government’s ability to protect the public from air pollution and soil contamination.  If EPA does indeed lose the case, Congress should clarify the Clean Water Act to make clear that review of the content of an administrative order should wait until the agency brings a judicial enforcement action.

Nina Mendelson, CPR Member Scholar; Professor of Law, University of Michigan Law School. Bio.

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1 Hopefully the Sacjketts and freedom and sanity will win over this out of control agency. The question is will the lower courts like the 9th Circus Court of Schlemiels abide by the decision or go rogue.
-- Bill Smith

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