Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-14-05305/USCOURTS-caDC-14-05305-0/pdf.json

Nature of Suit Code: 893
Nature of Suit: Environmental Matters
Cause of Action: 

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United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued April 11, 2016 Decided July 19, 2016

No. 14-5305

MINGO LOGAN COAL COMPANY,

APPELLANT

v.

ENVIRONMENTAL PROTECTION AGENCY,

APPELLEE

Appeal from the United States District Court

for the District of Columbia

(No. 1:10-cv-00541)

Paul D. Clement argued the cause for the appellant. 

Jeffrey M. Harris, Nathan A. Sales, Robert M. Rolfe, George P. 

Sibley III, Virginia S. Albrecht and Deidre G. Duncan were 

with him on brief.

Matthew Littleton, Attorney, United States Department of 

Justice, argued the cause for the appellee. John C. Cruden, 

Assistant Attorney General, Aaron P. Avila, Mark R. Haag, 

Cynthia J. Morris, Kenneth C. Amaditz, Attorneys, Stefania D. 

Shamet, Counsel, United States Environmental Protection 

Agency, and Ann D. Navaro, Assistant Chief Counsel for 

Litigation, were with him on brief.

USCA Case #14-5305 Document #1625459 Filed: 07/19/2016 Page 1 of 58
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Emma C. Cheuse, Jennifer C. Chavez, and Benjamin A. 

Luckett were on brief for the amici curiae West Virginia 

Highlands Conservancy, et al. in support of the appellee.

Before: HENDERSON, KAVANAUGH and SRINIVASAN, 

Circuit Judges.

Opinion for the Court filed by Circuit Judge HENDERSON.

Dissenting opinion filed by Circuit Judge KAVANAUGH.

KAREN LECRAFT HENDERSON, Circuit Judge: In 2007, 

the United States Army Corps of Engineers (Corps) issued 

Mingo Logan Coal Co. (Mingo Logan) a permit to excavate the 

tops of several West Virginia mountains, extract exposed coal 

and dispose of the excess soil and rock in three surrounding 

valleys containing streams. Four years later, after additional 

study, the United States Environmental Protection Agency 

(EPA) decided that the project would result in “unacceptable 

adverse effect[s]” to the environment. See 33 U.S.C. 

§ 1344(c). The EPA therefore withdrew approval from two of 

the disposal sites, which together “make up roughly eighty 

eight percent of the total discharge area authorized by the 

permit.” Mingo Logan Coal Co. v. EPA (Mingo Logan I), 850 

F. Supp. 2d 133, 137 (D.D.C. 2012). In 2013, Mingo Logan 

challenged the EPA’s statutory authority to withdraw the two 

sites from the Corps permit after it had been issued but we 

determined that the Clean Water Act (CWA) authorized the 

EPA to do so. See Mingo Logan Coal Co. v. EPA (Mingo 

Logan II), 714 F.3d 608, 616 (D.C. Cir. 2013). We then 

remanded the case to the district court to consider Mingo 

Logan’s remaining Administrative Procedure Act (APA) 

challenges. See id. The district court thereafter rejected 

them. See Mingo Logan Coal Co. v. EPA (Mingo Logan III), 

70 F. Supp. 3d 151, 183 (D.D.C. 2014).

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Mingo Logan now appeals the district court’s resolution of 

its APA claims. Specifically, the company argues that the 

EPA failed to engage in reasoned decisionmaking by ignoring 

Mingo Logan’s reliance on the initial permit, impermissibly 

considering the effects of downstream water quality and failing 

to explain adequately why the project’s environmental effects 

were so unacceptable as to justify withdrawal. We conclude 

that the EPA did not violate the APA in withdrawing 

specification of certain disposal areas from the permit; rather, it 

considered the relevant factors and adequately explained its 

decision. The EPA’s ex post withdrawal is a product of its 

broad veto authority under the CWA, not a procedural defect. 

Accordingly, we affirm.

I.

A. Statutory and Regulatory Background

Under the CWA, 33 U.S.C. §§ 1251 et seq., a party must 

generally obtain a permit from the relevant state and/or federal 

authority before discharging “any pollutant” into “navigable 

waters.”1

 See id. §§ 1311(a), 1341–45. Two categories of 

permits are involved in this case: a permit for the discharge of 

“dredged or fill material” under section 404 of the Act, see id.

§ 1344, and a permit for the discharge of all other pollutants 

under section 402, see id. § 1342.

1. Section 404

Under section 404, the Corps and qualified states are 

authorized to issue permits allowing “the discharge of dredged 

or fill material” into bodies of water “at specified disposal 

 1

 The CWA defines “navigable waters” as “the waters of the 

United States, including the territorial seas.” 33 U.S.C. § 1362(7).

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sites.” Id. § 1344(a), (g). The permit is required if, as here, a 

permit applicant plans to remove soil or rock from one location 

(i.e., “fill material”2

) and dispose of it into “navigable waters.” 

See id. § 1344(a). The Corps specifies sites for disposal of 

dredge-and-fill material in accordance with so-called 404(b) 

Guidelines it has developed jointly with the EPA. See id.

§ 1344(b). Once the Corps has issued a 404 permit, it retains 

discretion to “modify, suspend, or revoke” it. 33 C.F.R. 

§ 325.7(a). “Among the factors to be considered” by the 

Corps in making a revocation decision are: 

the extent of the permittee’s compliance with the 

terms and conditions of the permit; whether or not 

circumstances relating to the authorized activity have 

changed since the permit was issued or extended, and 

the continuing adequacy of or need for the permit 

conditions; any significant objections to the 

authorized activity which were not earlier considered; 

revisions to applicable statutory and/or regulatory 

authorities; and the extent to which modification, 

suspension, or other action would adversely affect 

plans, investments and actions the permittee has 

reasonably made or taken in reliance on the permit.

Id.

 2

 Corps regulations define “fill material” as “material placed 

in waters of the United States where the material has the effect of (i) 

[r]eplacing any portion of a water of the United States with dry 

land[] or (ii) [c]hanging the bottom elevation of any portion of a 

water of the United States.” 33 C.F.R. § 323.2(e)(1). Examples 

include “rock, sand, soil, clay, plastics, construction debris, wood 

chips, [and] overburden from mining or other excavation activities.” 

Id. § 323.2(e)(2).

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Although the EPA does not issue the 404 permit directly, it 

has “a broad environmental ‘backstop’ authority over the 

[Corps’s] discharge site selection.” Mingo Logan II, 714 F.3d 

at 612. Specifically, under section 404(c), the EPA may 

“deny,” “restrict” or “withdraw[]” specification of a site for 

disposal of dredge-and-fill material. 33 U.S.C. § 1344(c). 

The EPA is authorized to exercise this authority “whenever 

[the EPA Administrator] determines, after notice and 

opportunity for public hearings, that the discharge of such 

materials into such area [specified for disposal] will have an 

unacceptable adverse effect on municipal water supplies, 

shellfish beds and fishery areas (including spawning and 

breeding areas), wildlife, or recreational areas.” Id. (emphasis 

added). In Mingo Logan II, we held that the EPA could 

exercise this “backstop” authority both pre-permit and 

post-permit; that is, the EPA may prevent the Corps from 

issuing a 404 permit specifying a disposal site or it may 

withdraw specification of a disposal site after the Corps has 

issued a permit. Mingo Logan II, 714 F.3d at 612–14, 616.

EPA regulations further define the adverse environmental 

effects the Administrator must identify before stepping in to 

deny, restrict or withdraw a 404 permit. Specifically, the EPA 

has interpreted “unacceptable adverse effect” to mean an 

“impact on an aquatic or wetland ecosystem which is likely to 

result in significant degradation of municipal water supplies 

(including surface or ground water) or significant loss of or 

damage to fisheries, shellfishing, or wildlife habitat or 

recreation areas.” 40 C.F.R. § 231.2(e) (emphases added). 

When the EPA restricts or withdraws areas specified for 

disposal in a validly issued permit, the entire permit is not 

necessarily invalidated; rather, the permit is “in effect amended 

so that discharges at the previously specified disposal sites are 

no longer in ‘[c]ompliance with’ the permit.” Mingo Logan 

II, 714 F.3d at 615 (alteration in original) (quoting 33 U.S.C. 

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§ 1344(p)). Thus, to the extent a site passes EPA muster, the 

permittee may continue to dispose of dredge-and-fill material 

thereat. See id. at 615 & n.5. 

2. Section 402

Section 402 of the CWA establishes a separate permitting 

scheme, called the National Pollutant Discharge Elimination 

System (NPDES), under which the EPA is authorized to issue a 

permit for the discharge of all pollutants other than 

dredge-and-fill material. See 33 U.S.C. § 1342(a); see also 

Coeur Alaska, Inc. v. Se. Alaska Conservation Council, 557 

U.S. 261, 273 (2009). Alternatively, a state may assume 

authority for issuing a NPDES permit “for discharges into 

navigable waters within its jurisdiction.” 33 U.S.C. 

§ 1342(b). If a state submits a description of its planned 

permitting program to the EPA and its plan meets the relevant 

CWA criteria, the EPA “shall approve” the program. Id. 

The state then becomes responsible for issuing a NPDES 

permit for pollutant discharge, see id., and the federal NPDES 

permitting program is suspended for qualified waters within 

that state’s jurisdiction, see id. § 1342(c)(1).

The EPA, however, maintains an oversight role. It may 

“withdraw approval of [the state] program” if it determines that 

the program is not being administered in accordance with the 

CWA and the state takes no corrective action. See id.

§ 1342(c)(3). Further, a state must submit to the EPA a copy 

of each permit application it receives and must keep the EPA 

informed of the state’s consideration of the application. Id.

§ 1342(d)(1). The EPA, acting through its Administrator, 

may object to the issuance of a state NPDES permit within 

ninety days of receipt thereof and, if it does so, the state may 

not issue the permit. See id. § 1342(d)(2). If the state fails to 

revise the permit to comply with CWA guidelines and 

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requirements, the EPA may issue a revised permit that 

complies with the CWA. See id. § 1342(d)(4). Importantly, 

“[o]nce a section 402 permit has been issued, it may only be 

modified by the entity that issued the permit.” Mingo Logan 

III, 70 F. Supp. 3d at 155 (citing 40 C.F.R. §§ 122.2, 122.62, 

124.5(c)).

B. Factual Background

In 1997, Hobet Mining, Inc., Mingo Logan’s predecessor, 

began the process of securing the various permits required for 

operation of the Spruce No. 1 Mine, a proposed large-scale 

surface mining operation in West Virginia. Mingo Logan 

planned to use a surface-mining technique known as 

mountaintop mining at Spruce No. 1, whereby large swathes of 

land are removed from the surface, exposing coal deposits 

underneath. See generally Ohio Valley Envtl. Coal. v. 

Aracoma Coal Co., 556 F.3d 177, 186 (4th Cir. 2009). The 

excess soil and rock (“spoil” or “overburden”) is then relocated 

to adjacent valleys, “creating a ‘valley fill’ that buries 

intermittent and perennial streams in the process.” Id. 

Runoff water from the valley fill is collected in sediment 

ponds, where sediment suspended in the runoff water is 

allowed to settle. Id. The water collected in the ponds is then 

treated and discharged back into natural streams. Id.

Mingo Logan’s final proposal for the mine designated 

three sites for disposal of spoil, resulting in the burial of 

approximately 7.48 miles of three streams: (1) Seng Camp 

Creek; (2) Pigeonroost Branch; and (3) Oldhouse Branch. 

Because the streams were also going to be affected by the 

discharge of treated water, the project required both a 404 

permit from the Corps for disposal of the spoil and an NPDES 

permit from West Virginia, which had secured an 

EPA-approved permitting plan under section 402. 

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Hobet Mining initiated the application process for a 

NPDES permit from West Virginia’s Department of 

Environmental Protection (WVDEP) in late 1997. Consistent 

with its CWA obligations, WVDEP notified the EPA of the 

application and forwarded it a proposed permit. The EPA 

initially objected but, after WVDEP placed additional 

conditions on the NPDES permit, the EPA withdrew its 

objections in December 1998 and approved the modified 

permit in January 1999. West Virginia thus issued a valid 

NPDES permit to Hobet Mining on January 11, 1999. The 

permit was modified in 2003 and 2005, which modifications 

were eventually approved by the EPA. The NPDES permit 

has since been renewed and remains in effect.

The 404 permitting process was much more extensive. 

Hobet Mining first applied to the Corps for an individual 404 

permit in 1999, triggering a lengthy review process. After a 

seven-year consultation with Mingo Logan, the EPA and West 

Virginia, the Corps produced a 1600-page draft Environmental 

Impact Statement (EIS) on March 31, 2006. Although the 

EPA “expressed its concern that ‘even with the best practices, 

mountaintop mining yields significant and unavoidable 

environmental impacts that had not been adequately described 

in the document,’ ” Mingo Logan II, 714 F.3d at 610 (quoting 

Letter from EPA, Region III to Corps, Huntington Dist., at 1 

(June 16, 2006)), it ultimately “declined to pursue a[n] . . . 

objection” to the issuance of a 404 permit, id. Specifically, in 

an email, William Hoffman, Director of the EPA Office of 

Environmental Programs, told the Corps that it “ha[d] no 

intention of taking [its] Spruce Mine concerns any further from 

a Section 404 standpoint.” E-mail from EPA to Corps (Nov. 

2, 2006), Joint App’x (J.A.) 292. On January 22, 2007, the 

Corps issued the 404 permit allowing the disposal of spoil into 

the three specified stream areas. 

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Mingo Logan’s 404 permit was almost immediately 

challenged in court by environmental groups, which added the 

permit to ongoing litigation challenging other coal-mining 

permits. See Ohio Valley Envtl. Coal. v. U.S. Army Corps of 

Eng’rs (OVEC), 243 F.R.D. 253, 255, 257 (S.D.W. Va. 2007).

3

 

Pursuant to an agreement it reached with the environmental 

plaintiffs, Mingo Logan began operations at the Spruce Mine 

in 2007 but limited its disposal of spoil to a single valley 

fill—the Seng Camp Creek disposal site. The other two 

disposal sites—Pigeonroost Branch and Oldhouse 

Branch—remained unused.

On September 3, 2009, the EPA stepped in. It requested 

that the Corps use its discretionary authority to suspend, revoke 

or modify the permit based on “new information and 

circumstances” that “justif[ied] reconsideration of the permit.” 

Letter from EPA, Region III to Corps, Huntington Dist., at 1 

(Sept. 3, 2009), J.A. 309. The Corps sought comment from 

Mingo Logan and West Virginia; both opposed revoking, 

suspending or modifying the permit and asserted that the 

EPA’s concerns were not based on new information. The 

Corps rejected the EPA request on September 30, 2009. After 

addressing each of the EPA’s concerns, the Corps “determined 

that no additional evaluation of the project’s effects on the 

environment are warranted, the permit will not be suspended, 

 3 The environmental litigation was stayed once the EPA 

requested that the Corps revoke Mingo Logan’s 404 permit, see 

OVEC, 2009 WL 3014943, at *1–2 (S.D.W. Va. Sept. 15, 2009), and 

the stay was extended once the EPA initiated its review of the permit 

under section 404(c), see OVEC, 2009 WL 3424175, at *1–4 

(S.D.W. Va. Oct. 21, 2009). It remains stayed as it relates to 

Mingo’s use of the Pigeonroost Branch and Oldhouse Branch 

disposal sites. See OVEC, Civil Action No. 3:05-0784 (Aug. 9, 

2012), ECF No. 525.

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modified or revoked, and a supplemental EIS will not be 

prepared.” Letter from Corps, Huntington Dist. to EPA, 

Region III, at 4 (Sept. 30, 2009), J.A. 331.

In response, on April 2, 2010, the EPA intervened directly. 

Invoking its veto authority under section 404(c), the EPA 

published a Proposed Determination withdrawing the 404 

permit specification of the (as yet unused) Pigeonroost and 

Oldhouse Branch disposal sites. These disposal sites together 

amounted to approximately eighty-eight per cent of the area 

the original permit allowed for valley fills.4

 See Mingo Logan 

I, 850 F. Supp. 2d at 137. After holding a public hearing and 

receiving comments, the EPA ultimately issued a Final 

Determination on January 13, 2011, withdrawing specification 

of the two disposal sites.

The EPA gave two primary reasons for its withdrawal: 

(1) the “unacceptable adverse impacts” resulting from “direct 

impacts to wildlife and wildlife habitat” in each area where the 

fill was in fact to occur (the fill “footprint”), see Final 

Determination of the U.S. Environmental Protection Agency 

Pursuant to § 404(c) of the Clean Water Act Concerning the 

Spruce No. 1 Mine, Logan County, West Virginia (Final 

Determination), at 47, 50 (Jan. 13, 2011); and (2) the 

“[u]nacceptable adverse impacts” on wildlife occurring 

“downstream of the footprint of the fills and sediment ponds,” 

id. at 50. As to the first basis, the EPA determined that “[t]he 

destruction of 6.6 miles of high quality stream habitat . . . , and 

the subsequent loss of many populations of 

 4

 Due to the amount of area withdrawn, Mingo Logan refers to 

the challenged EPA decision as the “revocation” or “withdrawal” of 

its permit and we follow suit. See, e.g., Appellant’s Br. 11, 18. We 

note, however, that Mingo Logan’s 404 permit remains in effect at 

the Seng Camp Creek site. 

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macroinvertebrates, salamanders, fish and other wildlife 

dependent upon that aquatic habitat area for survival, . . . will 

result in a loss of regional biodiversity and the broader 

ecosystem functions these populations provide.” Id. at 47. It 

cited specific concerns for each population described and, in 

view of its conclusion that the affected streams “are some of 

the last, rare and important high quality streams in the 

watershed,” it decided that the adverse effect on the local 

wildlife “is one that the aquatic ecosystem cannot afford.” Id.

at 50. As for the adverse environmental impact downstream, 

the EPA concluded that removing the Pigeonroost and 

Oldhouse Branches “as sources of freshwater dilution and 

converting them to sources of pollution” would increase water 

contamination and salinity, both producing a negative effect on 

various wildlife, including macroinvertebrates, salamanders, 

fish and water-dependent birds. Id. at 50, 60–73.

C. Procedural Background

Once the EPA issued its Final Determination, Mingo 

Logan filed suit in district court, alleging that the EPA lacked 

statutory authority under the CWA to revoke a valid 404 permit 

after the Corps had issued it and that the EPA’s Final 

Determination was, for numerous reasons, arbitrary, 

capricious, or otherwise contrary to law in violation of the 

Administrative Procedure Act (APA), 5 U.S.C. § 706. See 

Mingo Logan III, 70 F. Supp. 3d at 160. We resolved the first 

claim in Mingo Logan II, upholding the EPA’s authority under 

section 404(c) of the CWA to withdraw specification of 

spoil-disposal sites after the Corps had issued a 404 permit. 

See 714 F.3d at 616. We remanded the APA claim to the 

district court. Id.

On remand, the district court concluded that the EPA’s 

Final Determination complied with the APA. See Mingo 

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Logan III, 70 F. Supp. 3d at 154–55. It noted that both bases 

the EPA asserted for withdrawing the permit—the direct 

effects to wildlife within the valley fills’ footprint and the 

effects of the valley fills on downstream 

wildlife—independently supported its revocation decision, 

concluding that the EPA had not acted arbitrarily or 

capriciously in identifying “unacceptable adverse effect[s]” 

under both rationales. Id. at 175–76 (effects within the 

footprint); id. at 181–83 (downstream effects). Accordingly, 

it granted summary judgment to the EPA. Id. at 183. Mingo 

Logan now appeals. Our review is de novo. Murphy v. Exec. 

Office for U.S. Attorneys, 789 F.3d 204, 208 (D.C. Cir. 2015); 

see also Holland v. Nat’l Mining Ass’n, 309 F.3d 808, 814 

(D.C. Cir. 2002) (“[W]e review the administrative action 

directly, according no particular deference to the judgment of 

the District Court.”).

II.

The general legal principles attending our review are 

well-settled. The APA directs us to “set aside agency action” 

that is “arbitrary, capricious, an abuse of discretion, or 

otherwise not in accordance with law.” 5 U.S.C. § 706(2)(A). 

Agency action is “arbitrary and capricious if the agency has 

relied on factors which Congress has not intended it to 

consider, entirely failed to consider an important aspect of the 

problem, [or] offered an explanation for its decision that runs 

counter to the evidence before the agency.” Motor Vehicle 

Mfrs. Ass’n of the U.S., Inc. v. State Farm Mut. Auto. Ins. Co., 

463 U.S. 29, 43 (1983). Although we must ensure that “an 

agency’s decreed result [is] within the scope of its lawful 

authority” and that “the process by which it reaches that result 

[is] logical and rational,” Michigan v. EPA, 135 S. Ct. 2699, 

2706 (2015) (quoting Allentown Mack Sales & Serv., Inc. v. 

NLRB, 522 U.S. 359, 374 (1998)), we are “not to substitute 

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[our] judgment for that of the agency,” State Farm, 463 U.S. at 

43. Whether we would have done what the agency did is 

immaterial; so long as the agency “examine[d] the relevant 

data and articulate[d] a satisfactory explanation for its action[,] 

including a ‘rational connection between the facts found and 

the choice made,’ ” we will ordinarily uphold it. Id. (quoting 

Burlington Truck Lines v. United States, 371 U.S. 156, 168 

(1962)).

When an agency changes policy, however, it must in some 

cases “provide a more detailed justification than what would 

suffice for a new policy created on a blank slate.” FCC v. Fox

Television Stations, Inc., 556 U.S. 502, 515 (2009). Changing 

policy does not, on its own, trigger an especially “demanding 

burden of justification,” Ark Initiative v. Tidwell, 816 F.3d 119, 

127 (D.C. Cir. 2016); indeed, the agency “need not 

demonstrate to a court’s satisfaction that the reasons for the 

new policy are better than the reasons for the old one,” Fox, 

556 U.S. at 515 (emphasis in original). That said, if a “new 

policy rests upon factual findings that contradict those which 

underlay [an agency’s] prior policy,” the agency “must” 

provide “a more detailed justification” for its action. Id. The 

same is true if the agency’s “prior policy has engendered 

serious reliance interests that must be taken into account.” Id. 

In such cases, in order to offer “a satisfactory explanation” for 

its action, “including a rational connection between the facts 

found and the choice made,” State Farm, 463 U.S. at 43

(internal quotation marks omitted), the agency must give “a 

reasoned explanation . . . for disregarding facts and 

circumstances that underlay or were engendered by the prior 

policy,” Fox, 556 U.S. at 516. 

In this case, Mingo Logan claims that the EPA’s 

post-permit revocation is the epitome of arbitrary-andcapricious agency action. Not only did the EPA “entirely 

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fail[] to consider an important aspect of the problem,” Mingo 

Logan claims, it also “relied on factors which Congress has not 

intended it to consider” and “offered an explanation for its 

decision that runs counter to the evidence.” See State Farm, 

463 U.S. at 43. This “rare and impressive trifecta,” 

Appellant’s Br. 4, is particularly egregious, Mingo Logan 

avers, given that the EPA was subject to Fox’s more detailed 

justification standard, see 556 U.S. at 515–16. As Mingo 

Logan sees it, because the EPA did not veto the Spruce No. 1 

permit the first time around, it must provide a weighty basis for 

withdrawing specification of two disposal sites four years later. 

We disagree with Mingo Logan’s assessment and address each 

prong of the alleged “trifecta” in turn.

A. EPA’s Consideration of Relevant Factors

Mingo Logan first argues that the EPA “entirely failed to 

consider an important aspect of the problem”—the costs 

Mingo Logan incurred in reliance on the permit and its history 

of compliance with the permit’s conditions. Appellant’s Br. 

18–19 (quoting State Farm, 463 U.S. at 43). As Mingo Logan 

sees it, the EPA may revoke a permit only if it balances 

resulting adverse environmental effects against the permittee’s 

sunk costs and record of permit compliance; “[i]n practice, that 

means that [the] EPA may withdraw a specification when 

circumstances have changed radically or when the withdrawal 

has only a minor impact on the operations envisioned (and 

reliance interests generated) by the permit.” Id. at 18. 

Because the EPA did not “balance” these “competing 

considerations,” see id., but instead based its decision only on 

the existence vel non of adverse environmental effects, Mingo 

Logan cries foul.

In response, the EPA concedes that it did not consider 

Mingo Logan’s reliance costs or its compliance history and, in 

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its view, neither the CWA nor the APA requires it to do so. It 

contends, however, that we need not reach this issue because 

Mingo Logan failed to make the argument to the agency or to 

the district court and has thus forfeited it.

We agree with the EPA that the argument is forfeited and 

doubly so. “Simple fairness to those who are engaged in the 

tasks of administration, and to litigants, requires as a general 

rule that courts should not topple over administrative decisions 

unless the administrative body not only has erred but has erred 

against objection made at the time appropriate under its 

practice.” United States v. L.A. Tucker Truck Lines, Inc., 344 

U.S. 33, 37 (1952). Thus, “[a]s a general rule, claims not 

presented to [an] agency may not be made for the first time to a 

reviewing court.” Omnipoint Corp. v. FCC, 78 F.3d 620, 635 

(D.C. Cir. 1996); see also Nat’l Wildlife Fed. v. EPA, 286 F.3d 

554, 562 (D.C. Cir. 2002) (“It is well established that issues not 

raised in comments before the agency are waived and this 

Court will not consider them.”); Vill. of Barrington v. Surface 

Transp. Bd., 636 F.3d 650, 655 (D.C. Cir. 2011) (parties must 

“forcefully present[] their arguments at the time appropriate 

under [agency] practice or else waive the right to raise those 

arguments on appeal” (alterations in original) (citations and 

internal quotation marks omitted)). The same rule applies on 

appeal from district court judgments. “Generally, an 

argument not made in the lower tribunal is deemed forfeited 

and will not be entertained [on appeal] absent exceptional 

circumstances.” Flynn v. Comm’r, 269 F.3d 1064, 1068–69 

(D.C. Cir. 2001) (internal quotation marks omitted).

Here, Mingo Logan did not argue the reliance-costs and 

compliance-history issue before the EPA or in district court,

notwithstanding numerous opportunities to do so. Indeed, the 

EPA’s process for finalizing its decision afforded Mingo 

Logan numerous chances to make the claim. The EPA first 

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published a Proposed Determination detailing its 

environmental concerns in part as follows: “[C]onstruction of 

Spruce No. 1 Mine as authorized would destroy streams and 

habitat, cause significant degradation of on-site and 

downstream water quality, and could therefore result in 

unacceptable adverse impacts to wildlife and fishery 

resources.” Proposed Determination to Prohibit, Restrict, or 

Deny the Specification, or the Use for Specification (Including 

Withdrawal of Specification), of an Area as a Disposal Site; 

Spruce No. 1 Surface Mine, Logan County, WV, 75 Fed Reg. 

16,788, 16,789 (Apr. 2, 2010). It then proposed to withdraw 

specification of the Pigeonroost and Oldhouse Branch sites, 

see id. at 16,805, and solicited comments on its proposal, see 

id. at 16,807–08, thereby providing Mingo Logan notice and an 

opportunity to put forward the factors that it believed the EPA 

was required to consider—and had failed to consider—in 

reaching its initial conclusion.

Mingo Logan responded to the Proposed Determination 

with 172 pages of comments. Conspicuously absent 

therefrom, however, was any argument that the EPA had to 

balance the environmental effects against the costs Mingo 

Logan had incurred in reliance on the permit before reaching a 

final decision.5

 Equally absent was a detailing of these costs 

 5

 Indeed, Mingo Logan’s comments in response to the EPA’s 

Proposed Determination seemed to accept the EPA’s merits position 

on the reliance-costs issue—that the EPA need base its decision on 

environmental factors only. Mingo Logan argued that the EPA 

could consider only the adverse environmental effects of the project 

on the resources specifically listed in section 404(c)—(1) municipal 

water supplies, (2) shellfishing areas/fisheries, (3) wildlife habitat 

and (4) recreation areas. As Mingo Logan put it, “[t]he 404(c) 

resources are therefore included to the exclusion of other resources, 

areas and concerns. The familiar principle of expressio unius est 

exclusio alterius dictates that when a statute includes particular 

USCA Case #14-5305 Document #1625459 Filed: 07/19/2016 Page 16 of 58
17

the EPA, under Mingo Logan’s theory, was required to 

consider. Indeed, other than a single reference in introductory 

factual material mentioning the “millions of dollars” Mingo 

Logan allegedly spent “preparing the Spruce No. 1 site and 

commencing its operations” after the permit had issued, Mingo 

Logan never discussed what costs the EPA should consider or 

how those costs stacked up against the environmental concerns 

the EPA had identified. See Mingo Logan Coal Co., 

Comments in Response and in Opposition to the Proposed 

Determination 33 (June 3, 2010), J.A. 403. That a detailed 

statement of costs is missing here is unsurprising, of 

course—Mingo Logan never attempted to argue that the EPA 

was required to balance adverse effects against reliance costs 

in the first place.

After reviewing these and other comments on the 

Proposed Determination, an EPA Regional Director then 

published a Recommended Determination, again proposing to 

withdraw specification of the Pigeonroost Branch and 

Oldhouse Branch sites and again inviting comments. See 

Recommended Determination of the U.S. Environmental 

Protection Agency Region III Pursuant to Section 404(c) of the 

Clean Water Act (Sept. 24, 2010). Yet again, other than a 

single reference in introductory material—“[n]ow, more than 

three years after the issuance of the permit, as Mingo Logan is 

actively mining the site in an attempt to recoup its decade-long 

investment, EPA has declared that the impacts that it had 

approved are now unacceptable, and seeks to revoke the 

permit,” Mingo Logan Coal. Co., Comments in Response and 

in Opposition to the Recommended Determination 2 (Nov. 29, 

 

language to describe the scope of its application, this is to the 

exclusion of other areas of application.” Mingo Logan Coal Co., 

Comments in Response and in Opposition to the Proposed 

Determination 66 (June 3, 2010) (second emphasis added), J.A. 436.

USCA Case #14-5305 Document #1625459 Filed: 07/19/2016 Page 17 of 58
18

2010)—Mingo Logan never claimed that the EPA had to 

balance reliance costs against environmental effects6 nor did it 

detail those costs. Accordingly, by failing to make the claim 

before the EPA, Mingo Logan forfeited it.

Once the EPA published its Final Determination 

withdrawing specification of the disposal sites, Mingo Logan 

filed suit, eventually composed of a fourteen-count amended 

complaint. None of the counts alleged that the EPA’s Final 

Determination was arbitrary and capricious because it had 

 6

 In fact, in its comments responding to the Recommended 

Determination, Mingo Logan did suggest for the first time that some

kind of balancing was required but, in listing the relevant factors, it 

did not mention reliance costs: “ ‘Unacceptable,’ like ‘significant,’ 

is a relative term that must be weighed against the endangerment of 

the species, the size of the project, and any economic benefit from 

the project.” Mingo Logan Coal Co., Comments in Response and in 

Opposition to the Recommended Determination 6 n.11 (Nov. 29, 

2010). Moreover, even this argument was not presented in the 

context of an arbitrary-and-capricious challenge. See id. at 6. Our 

dissenting colleague nevertheless argues that it is sufficient to 

preserve Mingo Logan’s costs claim. See Dissenting Op. at 16. 

Not so. The comment says nothing whatsoever about reliance costs 

so it cannot preserve Mingo Logan’s claim on that point. The 

dissent asserts instead that it preserves some claim that a broader 

balancing is required. See id. Mingo Logan (once again), 

however, makes no such broad cost-balancing argument to us. It 

argues that its reliance costs and compliance history should have 

been considered—relying heavily on the language of Fox and the 

permit’s role in encouraging reliance—but it never argues for the 

kind of broad balancing the dissent suggests is applicable—e.g., the 

EPA must consider “the harm to. . . coal miners who had been or 

would be employed at the mine” or the fact that the mine could 

“contribute millions of dollars to the local economy and lower the 

price of electricity.” See id. at 7–8.

USCA Case #14-5305 Document #1625459 Filed: 07/19/2016 Page 18 of 58
19

failed to weigh Mingo Logan’s reliance costs. Again, other 

than one general allegation in the factual background—that 

“[a]fter receiving its Permit, Mingo Logan spent millions of 

dollars preparing the site and commencing construction and 

operations,” Am. Compl. ¶ 141—Mingo Logan did not assert 

an APA claim based on the EPA’s failure to consider its 

reliance costs.

After we decided Mingo Logan II, the case returned to the 

district court for consideration of the procedural issues. At the 

district court’s request, Mingo Logan submitted a 

supplemental brief summarizing the issues remaining for 

review. In its brief, Mingo Logan asked the court to resolve 

“four key questions of law”:

(1) “Can [the] EPA . . . base a section 404(c) 

decision on downstream water quality impacts that 

are regulated by West Virginia under section 402?”

(2) “Can [the] EPA base a section 404(c) 

determination on impacts caused by mining features 

other than the discharges authorized by Mingo 

Logan’s section 404 permit?”

(3) “Assuming arguendo that [the] EPA can base its 

section 404(c) veto on downstream water effects 

regulated by section 402, can [the] EPA use water 

quality standards other than West Virginia’s 

duly-adopted water quality standards to determine 

whether such effects are ‘unacceptable’ within the 

meaning of section 404(c)?” and

(4) “After the Corps has issued a permit under 

section 404(a), can [the] EPA act under section 404(c) 

in the absence of substantial new information that was 

not available prior to the issuance of the permit?”

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20

Supplemental Br. in Supp. of Mingo Logan’s Mot. for Summ. 

J. at 1–3, Mingo Logan III, 70 F. Supp. 3d 151 (No. 10-cv541), ECF No. 99. Once the court resolved these four 

questions, according to Mingo Logan, it could move on to the 

fifth and final question warranting review:

(5) “Did [the] EPA demonstrate, based on 

substantial new information, that the discharges of fill 

material authorized by the Corps permit would cause 

‘unacceptable adverse effects’ on wildlife?”

Id. at 3.

Conspicuously absent from this list—yet again—is the 

question Mingo Logan now presents for our review—whether 

the EPA’s failure to consider Mingo Logan’s reliance costs and 

compliance history renders its decision arbitrary and 

capricious. It is also worth noting, for good measure, that in 

an hours-long hearing on the procedural issues, covering over 

one hundred pages of transcript, Mingo Logan never once 

raised the reliance-costs claim to the district court. See 

generally Transcript of 7/30/14 Hearing, Mingo Logan III, 70 

F. Supp. 3d 151 (No. 10-cv-541). Unsurprisingly, having 

never been presented with the question, the district court did 

not address it.

This record notwithstanding, the dissent disagrees with

our conclusion that Mingo Logan forfeited its reliance-costs 

claim. Dissenting Op. at 15. Our disagreement, it seems, is 

attributable to two differences between us. First, he believes 

that merely mentioning the “millions of dollars” allegedly 

spent in reliance upon a permit is sufficient to preserve an 

argument that the EPA must weigh those reliance costs against 

environmental harms, see id. at 16–17, 20; we do not. But, as 

recently noted in Encino Motorcars, LLC v. Navarro, “[t]he 

extent to which [an agency] is obliged to address reliance will 

USCA Case #14-5305 Document #1625459 Filed: 07/19/2016 Page 20 of 58
21

be affected by the thoroughness of public comments it receives 

on the issue. . . . An agency cannot be faulted for failing to 

discuss at length matters only cursorily raised before it.” No. 

15-415, 2016 WL 3369424, at *9 n.2 (2016) (Ginsburg, J., 

concurring). Our cases have likewise demanded that parties 

“forcefully present[]” their arguments to the agency to preserve 

them on appeal. Vill. of Barrington, 636 F.3d at 656. A 

handful of offhand references to “millions of dollars” primarily 

in introductory material—and never raised in the context of a 

claim that the EPA must balance these costs against the 

environmental effects it identified—is insufficient to preserve 

the claim Mingo Logan now pursues on appeal.

Requiring a party to make a submission more detailed than 

“millions of dollars,” moreover, is not a triumph of form over 

function. Because Mingo Logan failed to detail its costs, the 

EPA could not have “consider[ed] and justif[ied] the costs of 

revoking the permit” as our colleague would require. See 

Dissenting Op. at 17. Indeed, we do not quibble with his 

general premise—and that of the many legal luminaries he 

cites—that an agency should generally weigh the costs of its 

action against its benefits. See id. at 5–6. But, on Mingo 

Logan’s submission, the EPA would have to ask: Did Mingo 

Logan rely on the permit to the tune of two “millions of 

dollars” or two hundred “millions of dollars?” What portion 

of the “millions” would in fact be lost by withdrawing two 

disposal sites inasmuch as Mingo Logan can continue to 

discharge spoil at the Seng Camp Creek site and neither the 

Pigeonroost Branch site nor the Oldhouse Branch site had 

become operational yet? The EPA’s obligation is to engage in 

reasoned decisionmaking but Mingo Logan has an obligation 

to explain why it believes its reliance costs must be considered 

and to supply sufficient information about its costs to allow the 

EPA to consider them. “[M]illions of dollars” is not enough.

USCA Case #14-5305 Document #1625459 Filed: 07/19/2016 Page 21 of 58
22

In support of his view that Mingo Logan preserved its 

reliance-costs claim, our dissenting colleague cites a number of 

instances in the record where Mingo Logan asserted that the 

EPA should be subject to an explanatory standard for 

withdrawing a permit different from the standard for objecting 

to one initially. See id. at 17–18. In our view, this argument 

is distinct from Mingo Logan’s claim that reliance costs must 

be considered. Because both arguments rely on language 

from Fox, it is tempting to conflate them. But there are 

important differences. In its reliance-costs argument, Mingo 

Logan claims that the EPA was required to balance the costs it 

incurred in reliance on the permit against the environmental 

concerns the EPA identified. As the dissent suggests, in that 

case the remedy would be to remand to the EPA to do the 

necessary balancing. See id. at 22. As discussed, the remedy 

informs in part our conclusion that Mingo Logan forfeited that 

argument because it failed to detail the costs in a way that the 

EPA could do what Mingo Logan now says it should do. See 

supra at 15–20.

Mingo Logan’s inadequate-explanation argument, in 

contrast, relies on Fox for a different argument. It claims that 

the EPA is subject to a heightened standard to justify its 

withdrawal decision and that, under that standard, the EPA’s 

explanation is insufficient. The remedy regarding this 

argument would be a remand to the EPA to better support 

revocation but the EPA could not balance reliance costs against 

environmental effects in doing so for the reasons already 

discussed. It would simply have to do a better job explaining 

why withdrawal was necessary in 2011 when it was not so in 

2007. Like our colleague, we believe that Mingo Logan 

sufficiently pressed this argument before the EPA and in 

district court. Indeed, as the dissent points out, see Dissenting 

Op. at 16–17, Mingo Logan consistently argued that a different 

standard applied post-permit and that, accordingly, the EPA 

USCA Case #14-5305 Document #1625459 Filed: 07/19/2016 Page 22 of 58
23

had to identify substantial new information to support its 

post-permit decision. Thus, this argument is properly before 

us and we address it (and reject it), see infra 28–35. But 

Mingo Logan’s post-permit heightened-standard claim does 

not preserve its reliance-costs claim. They are different 

claims supported by different arguments. Accordingly, 

having been forfeited not once, but twice (and perhaps thrice), 

we do not consider Mingo Logan’s reliance-costs claim for the 

first time on appeal.7

B. EPA’s Reliance on Proper Factors

Mingo Logan’s second argument is that the EPA’s 

revocation decision was arbitrary and capricious because it 

 7

 In reply to our dissenting colleague’s one-paragraph cri de 

coeur characterizing Mingo Logan’s forfeiture as “entirely unfair” 

based on EPA’s stance that costs are “irrelevant,” Dissenting Op. at 

21, we have an equally pithy reply: A party has an obligation to 

substantiate its position, including in the face of its opponent’s 

rejection thereof. Cf. L.A. Tucker Truck Lines, Inc., 344 U.S. at 37 

(agency’s “predetermined policy” does not absolve party of its 

obligation to object thereto). Forfeiture here is hardly “unfair” to 

Mingo Logan but, in any event, its minimal proof of its costs—as far 

as we can tell—mirrors their de minimis nature. And even if the 

EPA could be tagged with the “bait-and-switch” charge—a 

proposition we roundly reject—Mingo Logan’s failure to prove up 

its costs on review by the district court should mute its lament. In 

the end, Mingo Logan at no point—not before the EPA nor in district 

court—made any effort to describe its costs or make an argument 

about them. In that light, Mingo Logan can hardly now complain 

about unfairness. Moreover, as we have noted, supra nn.5–6, 

Mingo Logan effectively accepted the EPA’s position on the 

relevance of its reliance costs. It is hardly “unfair” to expect Mingo 

Logan to have raised whatever arguments it might have about the 

EPA’s position before the EPA itself.

USCA Case #14-5305 Document #1625459 Filed: 07/19/2016 Page 23 of 58
24

“relied on [a] factor[] which Congress has not intended it to 

consider,” see State Farm, 463 U.S. at 43—water quality 

downstream from the valley fill. As mentioned, the EPA 

offered multiple bases for its decision in its Final 

Determination. It first identified adverse effects to wildlife 

within the footprint of the valley fills—that is, the area where 

the spoil was in fact to be disposed of. It then identified 

adverse effects to wildlife downstream from the fills 

attributable to increased levels of selenium and conductivity8

in downstream water.

Mingo Logan argues that the EPA cannot rely on 

downstream water quality as a basis for finding adverse

environmental effects. Because the “Congress has delegated 

responsibility for considering water quality to [West Virginia], 

not [the] EPA,” Appellant’s Br. 47, and West Virginia has 

granted Mingo Logan a section 402 permit that governs 

downstream water quality, Mingo Logan argues that the EPA 

has intruded upon West Virginia’s exclusive regulatory power 

over its “navigable waters,” see 33 U.S.C. § 1342(b). Mingo 

Logan also contends that the EPA impermissibly applied its 

own water-quality standards in considering downstream 

effects. The application of such “ad hoc” standards, 

according to Mingo Logan, is arbitrary and capricious. 

Appellant’s Br. 56–57.

 8

 Selenium is “a naturally occurring chemical element that is 

an essential micronutrient, but can also have toxic effects following 

exposure to excessive amounts.” Final Determination, at 51. 

“Conductivity is the ability of a solution to carry an electric current 

at a specific temperature” and “is an excellent indicator of the total 

concentration of all ions” in a given solution. Id. at 58–59. 

Salinity—“the amount of dissolved salt in a given body of 

water”—is “often expressed in terms of specific conductivity.” Id.

at 58.

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25

We reject this argument for several reasons. As an initial 

matter, section 404(c) allows the EPA to consider the effects of 

spoil disposal downstream from the fill itself and downstream 

water quality may enter the equation. The statute authorizes 

the Administrator “to deny or restrict the use of any defined 

area for specification” if he determines “that the discharge of 

such materials into such area will have an unacceptable 

adverse effect on municipal water supplies, shellfish beds and

fishery areas . . . , wildlife, or recreational areas.” 33 U.S.C. 

§ 1344(c). The reference to “municipal water supplies,” id., is 

telling; how can the EPA assess whether a valley fill will have 

an “unacceptable adverse effect on municipal water supplies” 

without considering the effects of the valley fill on downstream 

water quality? We have little trouble concluding that, as part 

of the EPA’s overall authority, section 404(c) authorizes it to 

assess the effects of the fill beyond the fill’s footprint and that 

nothing in the statute prohibits water quality from being part of 

that assessment.

Mingo Logan essentially concedes the general point;9 the 

real problem, it claims, is that the state of West Virginia has 

already determined that the fills will not cause water-quality 

problems downstream. Because the Congress has granted 

states power to regulate their own water quality under section 

402, once a state has signed off on a project by granting a 

section 402 permit, Mingo Logan argues, the EPA is not 

authorized to reassess water quality under section 404(c) using 

its own ad hoc standards. If the EPA does so, Mingo Logan 

contends, it impermissibly traverses the Congress’s intent by 

ignoring the bright line between section 402 regulation and 

section 404 regulation and raises federalism concerns to boot.

 9

 See Appellant’s Reply Br. 26 (“Mingo Logan [does not] 

deny that, in the absence of authorized State action, [the] EPA may 

take downstream water quality into account . . . .”).

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Mingo Logan’s argument fundamentally misinterprets 

what the EPA does in evaluating changes in water quality 

attributable to the disposal of spoil in designated streams. It is 

true that section 402 grants a qualifying state broad authority to 

regulate its water quality, see 33 U.S.C. § 1342, and that 

regulation under sections 402 and 404 is generally distinct, see 

Coeur Alaska, Inc., 557 U.S. at 274, 276–77. As the district 

court concluded, however, there is an important difference 

between “regulating” pollutant discharge under section 402 

and identifying unacceptable adverse effects on four specific 

categories of resources as a result of spoil disposal under 

section 404(c). See Mingo Logan III, 70 F. Supp. 3d at 177. 

Indeed, we do not take issue with Mingo Logan’s contention 

that, here, the primary authority under section 402 lies with 

West Virginia. Under the NPDES program, West Virginia 

permits the discharge of water from sediment ponds into 

natural streams based upon state water-quality criteria and sets 

conditions on those discharges to manage the flow of 

pollutants into natural waters within its jurisdiction. See 33 

U.S.C. § 1342. In contrast, the EPA does none of these 

things; it does not intrude on West Virginia’s authority to 

regulate water quality under section 402 because the EPA is 

not regulating the discharge of pollutants into West Virginia 

waters downstream from the fill. It is instead assessing 

whether discharging spoil into a particular stream will produce 

“unacceptable adverse effect[s]” on wildlife. Id. § 1344(c). 

And it evaluates the effects of that spoil—both inside and 

outside the fill’s footprint—in making its assessment, 

including the changes the spoil might bring about in 

downstream water quality.

This raises a third, related point. Although Mingo Logan 

makes much of the “EPA’s consideration of water quality,” see

Appellant’s Br. 53, the EPA did not base its revocation 

decision on an evaluation of downstream water quality per se; 

USCA Case #14-5305 Document #1625459 Filed: 07/19/2016 Page 26 of 58
27

rather, evaluating downstream water quality was just one step 

in its process of evaluating “unacceptable adverse effect[s]” on 

wildlife under section 404(c), see 33 U.S.C. § 1344(c). The 

EPA must connect conclusions it makes about downstream 

water to adverse effects on the specific resources listed in 

section 404(c)—municipal water supplies, shellfishing areas or 

fisheries, wildlife or recreational areas. See id. It satisfied 

this obligation; it pinpointed the requisite connection between 

its water quality assessment and its adverse-effects conclusions 

regarding section 404(c) resources.10 Specifically, it relied on 

studies showing that selenium levels above five micrograms 

per liter produce harmful effects on macroinvertebrates, see 

Final Determination, at 60–61, and fish, see id. at 71–72, which 

in turn results in negative food-web 11 implications for the 

broader ecosystem, see id. at 68. And it included detailed

information—including new information based on actual data 

from the Seng Camp Creek site, see infra at 30—supporting its 

conclusion that a significant risk of selenium levels regularly 

exceeding five micrograms per liter would result at the 

Pigeonroost Branch and Oldhouse Branch sites. See Final 

Determination, at 52–58. The EPA also explained why 

 10 The EPA specifically acknowledged that its conclusions 

about adverse effects on wildlife were “not dependent on a 

conclusion that West Virginia’s water quality standards will be 

violated at or downstream of the site.” Final Determination, at 51. 

It thus explicitly recognized that its consideration of downstream 

water quality was only an intermediate step in its section 404 

environmental analysis.

11 The food web refers to the interconnected manner in which 

species in an ecosystem act as food sources for others. See Final 

Determination, at 32–33; see also Nat’l Ass’n of Home Builders v. 

Babbitt, 130 F.3d 1041, 1052 n.11 (D.C. Cir. 1997) (citing E.O

WILSON, THE DIVERSITY OF LIFE 308 (2d ed. 1992)).

USCA Case #14-5305 Document #1625459 Filed: 07/19/2016 Page 27 of 58
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elevated levels of conductivity it anticipated to occur 

downstream were harmful, citing “an accepted and peer 

reviewed approach” for measuring the effects of conductivity 

on macroinvertebrates, see id. at 65–67. In addition, it 

explained the fact that conductivity in the range it expected 

would support golden algae growth, which in turn would have 

negative effects on salamanders and fish, see id. at 69–71. In 

sum, the EPA’s consideration of downstream water quality as a 

means of evaluating the project’s adverse effects on wildlife 

was not arbitrary and capricious; rather, it was the product of 

reasoned decisionmaking supported by evidence in the record 

and based upon the EPA’s technical expertise.

C. EPA’s Explanation of its “Volte Face”

Mingo Logan’s final argument is that the EPA failed to 

adequately explain its revocation decision given that it allowed 

the 404 permit to proceed four years earlier. Mingo Logan

argues that this change triggers the “more detailed” 

justification standard discussed in Fox, 556 U.S. at 515, and 

because the “EPA cannot point to any new information—let 

alone substantial or more detailed information—that 

overcomes” its original decision not to veto the permit, 

Appellant’s Br. 32, we must set its Final Determination aside. 

Mingo Logan argues further that even under the ordinary APA 

explanation standard articulated in State Farm, 463 U.S. at 43, 

the EPA has failed to adequately explain its decision to revoke; 

the “unacceptable” effects the EPA identified, Mingo Logan 

claims, typically result from any large-scale surface coal mine.

The district court rejected Mingo Logan’s assertion that a

more detailed justification standard applies, concluding that, 

notwithstanding the EPA’s original acquiescence, it did not 

amount to a “policy”; accordingly, the EPA’s subsequent 

withdrawal decision was not a change of course triggering the 

USCA Case #14-5305 Document #1625459 Filed: 07/19/2016 Page 28 of 58
29

more detailed Fox standard. Mingo Logan III, 70 F. Supp. 3d 

at 163–68. We need not resolve the question of whether a 

“more detailed” explanatory standard applies here because we 

find the EPA’s explanation adequate even assuming arguendo

that it was required to supply “a more detailed justification” for 

its revocation decision, see Fox, 556 U.S. at 515. It 

adequately explained how new information arising after the 

404 permit issued informed its conclusion that the project 

would result in “unacceptable adverse effect[s]” to wildlife. 

See 33 U.S.C. § 1344(c). Indeed, the EPA acknowledged 

early on in its Final Determination that the game had changed. 

Its comments on the matter are worth quoting at length:

Throughout the history of the Spruce No. 1 Surface 

Mine . . . Permit, [the] EPA has raised concerns 

regarding adverse impacts to the environment. 

Additional data and information, including 

peer-reviewed scientific studies of the ecoregion, 

have become available since permit issuance. The 

peer-reviewed literature now reflect[s] a growing 

consensus of the importance of headwater streams[]

[and] a growing concern about the adverse ecological 

effects of mountaintop removal mining, specifically 

with regard to the effects of elevated levels of total 

dissolved solids discharged by mining operations on

downstream aquatic ecosystems . . . .

Final Determination, at 8. The EPA then went on to 

describe—in detail—its assessment of the “unacceptable 

adverse effect[s]” both within the fills’ footprint and 

downstream from the valley fill.

Mingo Logan’s challenge to the adequacy of the EPA’s 

justification focuses exclusively on the EPA’s discussion of 

adverse effects in the valley fills’ footprint; it does not contest 

USCA Case #14-5305 Document #1625459 Filed: 07/19/2016 Page 29 of 58
30

the sufficiency of the EPA’s downstream-effects 

justification.12 And for good reason—the EPA plainly relied 

on extensive post-permit information in determining that the 

water-chemistry changes wrought by the fills would negatively 

affect wildlife. The EPA’s conclusions that increased levels 

of selenium and conductivity would cause “unacceptable 

adverse effect[s]” to wildlife were based upon data collected 

from an adjacent mine from 2007 to 2010, and—most relevant 

here—from water sources handling outflow from the Seng 

Camp Creek disposal site, the only site that became operational 

after the 404 permit was originally issued. As far as 

substantial new information goes, it is difficult to think of more 

salient post-permit data than that collected from the very mine 

under consideration. The post-permit data from the Seng 

Camp Creek site and the adjacent mine indicated that selenium 

in waters flowing from these sites regularly exceeded the 

selenium levels the EPA determined would produce harmful 

effects on wildlife. Moreover, the EPA’s discussion of how 

changes in water chemistry would negatively affect wildlife 

was extensive and also relied on scientific studies published 

post-permit, as well as on post-permit data regarding the risk 

factors for golden-algae growth and its associated adverse 

environmental effects. These explanations relying on new 

data are sufficient to satisfy the more detailed explanatory 

obligation discussed by Fox. The EPA’s “explanation” for 

“disregarding facts and circumstances that underlay or were 

engendered by the prior policy” was “reasoned,” Fox, 556 U.S. 

at 515–16—new data from the Seng Camp Creek site 

confirmed that selenium and conductivity levels were rising to 

potentially harmful levels and would cause significant wildlife 

 12 As discussed, however, Mingo Logan does challenge the 

EPA’s authority to consider downstream water quality at all. See 

supra at 23–24.

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degradation if additional valley fills were constructed at 

Pigeonroost Branch and Oldhouse Branch.

The same is true of the EPA’s explanations of the 

unacceptable adverse effects on wildlife within the valley fills’ 

footprint. Although Mingo Logan argues that the EPA’s 

explanation fails even the basic APA arbitrary-and-capricious 

standard because the allegedly “unacceptable” environmental 

effects the EPA identified are the “routine” environmental 

impacts associated with any dredge-and-fill discharge, 

Appellant’s Br. 44, the EPA explained why it viewed the 

adverse effects on wildlife as “significant” and therefore 

“unacceptable,” see 40 C.F.R. § 231.2(e), and how new 

information developed after the permit issued reasonably 

informed its conclusions. The following discussion 

summarizes the EPA’s multi-page explanation.

The EPA first noted that the sheer size of the Spruce No. 1 

Mine project rebutted Mingo Logan’s characterization of the 

project’s effects on wildlife as routine. As the EPA explained, 

“[t]he Spruce No. 1 Mine . . . is one of the largest mountaintop 

mining projects ever authorized in West Virginia,” affecting 

approximately 3.5 square miles and resulting in the burial of 

approximately 7.48 miles of high-quality streams. Final 

Determination, at 15. “By way of comparison,” the EPA 

noted, “the project area would take up a sizeable portion of the 

downtown area of Pittsburgh, PA.” Id. Relatedly, the EPA 

cited the large number of species within the proposed fill, 

noting that watersheds within the Central Appalachian region 

are some of the continent’s most biologically diverse and that 

the Pigeonroost Branch and Oldhouse Branch watersheds are 

no exception. Id. at 30–31, 47. The EPA gave great weight 

to both of these factors, explaining that a large part of the 

“significance” of the adverse environmental effects it predicted 

results from such a large-scale ecosystem disruption in one of 

USCA Case #14-5305 Document #1625459 Filed: 07/19/2016 Page 31 of 58
32

most biologically diverse areas in the country. See id. at 30–

31, 50. 

The EPA also detailed the adverse effects—and the 

implications for the broader ecosystem—on specific categories 

of wildlife. The EPA explained that Pigeonroost Branch and 

Oldhouse Branch are home to a particularly diverse group of 

macroinvertebrates and wide-scale elimination of these 

populations would have a significant negative impact on the 

broader “faunal food web” given that macroinvertebrates form 

its foundation. Id. at 47, 49–50. The EPA further explained 

how burying 6.6 miles13 of stream will affect other wildlife 

directly—salamanders, fish and water-dependent birds.14 The 

EPA estimated that roughly 250,000 salamanders would be 

killed within the fills’ footprint (5–6 salamanders per square 

meter) and that the large-scale loss of “a key component of the 

aquatic food web” will have “broader food web implications, 

as they . . . serve as prey for numerous terrestrial and aquatic 

species found within the Spruce No. 1 Mine site, including 

fish, snakes, birds, mammals, turtles, frogs, crayfish and other 

salamanders.” Id. at 48. The EPA also explained that 

 13 Although the Spruce No. 1 mine called for filling a total of 

7.48 miles of streams with spoil, see supra at 31, that number 

included the valley fill at the Seng Camp Creek site. The valley fills 

at the Pigeonroost Branch and Oldhouse Branch sites would fill 6.6 

miles of stream.

14 The district court found that the EPA’s reliance upon the 

fills’ effects on a water-dependent bird—the Louisiana 

waterthrush—“dances close to the line of what is reasonable” given 

that the bird has never been observed in the project area. Mingo 

Logan III, 70 F. Supp. 3d at 171 n.23. The EPA has wisely stepped 

back from its reliance on this particular adverse effect as necessary to 

support its decision. See Appellee’s Br. 45.

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33

sampling data suggested five populations of fish would be 

directly—and adversely—affected by the fill. Id. at 38–39, 

48–49. 

Moreover, these explanations were not, as Mingo Logan 

suggests, Appellant’s Br. 44–45, based purely on information 

the EPA had at its disposal before the 404 permit issued. 

Rather, it relied on a variety of post-permit data to support its 

conclusions and, where relevant, explained how circumstances 

had changed over time. 

First, the EPA’s analysis cited several post-permit studies

suggesting headwater streams like Pigeonroost Branch and 

Oldhouse Branch play an outsized role in the creation and 

preservation of a robust and diverse regional ecosystem. As 

the EPA explained, after the permit was issued, “the scientific 

literature reflected a growing consensus of the importance of 

headwater streams.” Final Determination, at 20. “Many 

[post- permit] studies,” the EPA went on, “now point to the 

role headwater streams play in the transport of water, 

sediments, organic matter, nutrients, and organisms to 

downstream environments; their use by organisms for 

spawning or refugia; and their contribution to regional 

biodiversity.” Id.

This general shift in perspective on the importance of 

headwater streams—undergirded by post-permit scientific 

evidence—permeates the EPA’s entire analysis of the 

environmental effects of the valley fill within the fills’ 

footprint. The EPA concluded that many of the direct adverse 

effects on wildlife within the disposal area are “unacceptable” 

because Pigeonroost Branch and Oldhouse Branch are “some 

of the last remaining streams within the Headwaters Spruce 

Fork sub-watershed and the larger Coal River sub-basin that 

represent ‘least-disturbed’ conditions and habitat that is 

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34

essential for many species in the watershed.” Id. at 49. 

Consequently, the EPA explained, the streams “perform 

critical hydrologic and biological functions, support diverse 

and productive biological communities, contribute to 

prevention of further degradation of downstream waters, and 

play an important role within” the larger regional ecosystem. 

Id. Given “the evidence that these streams are some of the 

last, rare and important high quality streams in the watershed,” 

the EPA concluded that burying 6.6 miles of the streams with 

spoil would produce an “adverse impact . . . that the aquatic 

ecosystem cannot afford.” Id. at 50.

Second, the EPA discussed additional post-permit 

evidence suggesting that its original estimates about the return 

of salamanders to the area were flawed. Pre-permit density 

measurements suggested that the spoil would kill 

approximately 250,000 salamanders within the fill area. 

According to the EPA, “it had been assumed that species 

populating these waters would return, sometimes years later, to 

reestablish a community.” Appellee’s Br. 43–44. 

Post-permit data suggested, however, that even after twenty 

years, salamanders were not returning as expected to 

sedimentation ditches generated by now-closed West Virginia 

coal mines. See Final Determination, at 48.

Third, although pre-permit data suggested few fish would 

be affected by the project, post-permit data suggested 

additional species would experience adverse effects. As the 

EPA explained, sampling for the environmental study of the 

project suggested only a limited number of species lived in the 

Pigeonroost Branch and Oldhouse Branch streams. Id. at 38. 

The EPA concluded, however, that the pre-permit data were 

not reliable because the sampling had been conducted during a 

drought period. See id. It cited post-permit fish sampling 

data from 2008 and 2009 that “revealed a fish assemblage” in 

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35

the two streams. Id. Specifically, “[m]ottled sculpin, as well 

as sporadic populations of smallmouth bass and stonerollers 

were collected in Pigeonroost Branch,” whereas “only 

blacknose dace and creek chubs” had been found in the stream 

in 1999. Id. at 38, 39. And although “[n]o samples were 

collected in Oldhouse Branch” in 1999, the data indicated that 

blacknose dace and creek chubs also lived in that stream. Id.

at 38–39.

Thus, assuming arguendo that the EPA was subject to the 

“more detailed justification” standard described in Fox, 556 

U.S. at 515, we conclude that its Final Determination satisfied 

that requirement. It plainly relied upon new data—including 

data from the Spruce No. 1 Mine site itself—and explained the 

relevance of these data in concluding that the project would 

have unacceptable adverse effects on wildlife downstream 

from the fill sites. It also adequately explained how the valley 

fill would have an unacceptable adverse effect on wildlife 

within the fill and it specifically explained the new 

“consensus” on the importance of headwater streams, id. at 20, 

new scientific evidence about salamander repopulation, and 

new, more representative data about the fish species living in 

the fill area in doing so.

A few words in closing are in order. First, we do not hold 

that the EPA is generally exempt from considering costs in 

evaluating whether to withdraw a previously approved 

disposal site under section 404(c). We need not and do not 

decide precisely what the EPA may and must consider in 

making a post-permit withdrawal decision; we hold only that it 

is not expected to balance costs never presented to it. Second, 

we do not hold whether the EPA’s site withdrawal after the 

Corps has issued a 404 permit must always satisfy the more 

detailed justification standard articulated in Fox, 556 U.S. at 

515–16. Again, we need not and do not decide that question 

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36

because, even assuming the Fox standard applies, the EPA’s 

explanation satisfies it. Finally, we note that post-permit 

withdrawal under section 404(c) is a mighty power and its 

exercise will perhaps inevitably leave a permittee feeling as if 

the rug has been pulled out from under it. Nonetheless, this 

power is one the Congress has authorized the EPA to exercise 

and where, as here, the EPA has adequately explained why 

mine spoil disposal at two sites would cause “unacceptable 

adverse effect[s]” on “wildlife,” 33 U.S.C. § 1344(c), we must 

uphold its decision.

For the foregoing reasons, the judgment of the district 

court is affirmed.

So ordered.

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KAVANAUGH, Circuit Judge, dissenting: EPA must 

consider both costs and benefits before it vetoes or revokes a 

permit under Section 404 of the Clean Water Act. That much 

is common sense and settled law. See Michigan v. EPA, 135 

S. Ct. 2699 (2015). Here, however, EPA revoked a Clean 

Water Act permit without considering the costs of doing so. 

For that reason, EPA’s decision must be vacated. In my view, 

EPA must go back to the drawing board and weigh both the 

costs and benefits of revoking the permit before making its 

decision.

The case concerns Mingo Logan, a coal mining company

that planned to engage in surface coal mining in West 

Virginia. Under the Clean Water Act, the Company first 

needed to obtain what is known as a Section 404 permit. The 

Section 404 permit would allow Mingo Logan to dump into 

nearby streams the excess rubble generated by its surface 

mining operation – known under the Act as “fill material.” 

Mingo Logan’s ability to dispose of fill material into those 

streams was critical to the viability of the Company’s planned 

coal mining operation.

By statute, the Army Corps of Engineers oversees 

Section 404 permits. The Corps has the power to grant and 

revoke permits. To grant a Section 404 permit, the Corps 

must determine that the permit application meets guidelines 

developed jointly by the Corps and EPA. Among other 

things, the guidelines require the permit applicant to show that 

its planned disposal of fill material minimizes environmental 

impacts, to the extent practicable. The Corps may also revoke

a previously issued Section 404 permit, but only after the 

Corps considers a variety of factors such as the permittee’s 

investment-backed reliance on the permit.

In addition, Section 404(c) of the Clean Water Act grants 

EPA concurrent authority to (i) veto the issuance of a permit 

USCA Case #14-5305 Document #1625459 Filed: 07/19/2016 Page 37 of 58
2

or (ii) revoke a previously issued permit.

1

 To either veto or 

revoke a permit, EPA must determine that a permittee’s 

disposal of fill material at a given site “will have an 

unacceptable adverse effect on municipal water supplies, 

shellfish beds and fishery areas (including spawning and 

breeding areas), wildlife, or recreational areas.” 33 U.S.C.

§ 1344(c) (emphasis added).

In 2007, Mingo Logan obtained a Section 404 permit

from the Corps. By its terms, the permit allowed the 

Company to dispose of fill material for 24 years at three 

disposal sites, subject to various conditions and mitigation 

measures. Understandably relying on that permit, Mingo 

Logan subsequently spent millions of dollars on the mining 

operation and hired coal miners and other employees.

In 2007, EPA could have exercised its Section 404(c) 

authority to veto the issuance of Mingo Logan’s permit, but 

EPA chose not to do so. In 2011, EPA reversed course and

exercised its Section 404(c) authority to revoke Mingo 

Logan’s permit and shut down the mining operation.

EPA provided one reason for its 2011 revocation 

decision: Contrary to what it had concluded four years 

earlier, EPA now believed that Mingo Logan’s coal mining 

operation would have an “unacceptable adverse effect” on 

certain animals, particularly certain species of salamanders, 

fish, and birds. (There was no stated risk to humans or to 

drinking water from Mingo Logan’s disposal of fill material 

 

1 To be precise, EPA’s authority is to prohibit specification of 

disposal sites for fill material. See Mingo Logan Coal Co. v. EPA, 

714 F.3d 608 (D.C. Cir. 2013). In practice, that authority is often

tantamount to authority to veto or revoke permits. For ease of 

reference, I therefore will refer to EPA’s Section 404(c) authority 

as a power to veto or revoke permits.

USCA Case #14-5305 Document #1625459 Filed: 07/19/2016 Page 38 of 58
3

into the streams.) In EPA’s view, revoking Mingo Logan’s

permit would mitigate the adverse effect on animals. 

Mingo Logan complains that EPA considered only the 

benefits and did not consider any of the costs associated with 

revoking Mingo Logan’s permit. Those costs encompassed, 

for example, the negative financial impacts on Mingo Logan’s

owners and shareholders, including those who relied on the 

permit; on the coal miners who would lose their jobs; on the 

collateral businesses that sold services and products for the 

mining operation or otherwise depended on the mining 

operation; on the consumers who pay less for electricity when 

additional sources of energy are available; and on West 

Virginia’s tax revenues. According to Mingo Logan, EPA 

also failed to provide the “more detailed justification”

required by Supreme Court precedent when an agency 

changes course and revokes a previously issued permit on 

which the permittee had relied. FCC v. Fox Television 

Stations, Inc., 556 U.S. 502, 515 (2009).

The bottom line is that EPA considered the benefits to

animals of revoking the permit, but EPA never considered the 

costs to humans – coal miners, Mingo Logan’s shareholders,

local businesses, and the like – of revoking the permit. In my 

view, EPA’s utterly one-sided analysis did not come close to 

satisfying the agency’s duty under the Administrative 

Procedure Act and relevant Supreme Court precedents to

consider and justify the costs of revoking Mingo Logan’s

previously issued permit. 

To be clear, I am not here deciding how EPA should 

weigh the costs and benefits of revoking the permit, or what 

outcome the agency should reach when it conducts that 

analysis. Cf. Michigan, 135 S. Ct. at 2711, slip op. at 14 

(same); White Stallion Energy Center, LLC v. EPA, 748 F.3d 

USCA Case #14-5305 Document #1625459 Filed: 07/19/2016 Page 39 of 58
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1222, 1266 (D.C. Cir. 2014) (Kavanaugh, J., dissenting) 

(same). I am merely making the narrow but critical point that 

EPA must in fact consider both costs and benefits before 

deciding whether to revoke the permit. See Michigan, 135 S. 

Ct. 2699. EPA did not do so here. Under the Administrative 

Procedure Act and applicable Supreme Court precedent, that 

is not acceptable. I respectfully dissent.

I

By omitting consideration of costs, EPA’s decision

revoking Mingo Logan’s permit was doubly deficient under 

the Administrative Procedure Act. First, EPA failed its most 

basic duty under the Administrative Procedure Act to consider 

all of the relevant factors, including costs. Second, because 

EPA changed its position by revoking a previously issued

permit, EPA not only had to consider costs, but also had to 

provide a more detailed justification for its change in position. 

A

It is a fundamental principle of administrative law that 

federal “administrative agencies are required to engage in 

reasoned decisionmaking.” Michigan v. EPA, 135 S. Ct. 

2699, 2706, slip op. at 5 (2015) (internal quotation marks 

omitted). To engage in reasoned decisionmaking, an agency 

must consider all of the factors that are relevant to the

particular decision facing the agency. Id. In other words, an 

agency must consider each “important aspect of the problem.” 

Motor Vehicle Manufacturers Association of the United States 

v. State Farm Mutual Automobile Insurance Co., 463 U.S. 29, 

43 (1983). An agency must also articulate a “rational 

connection” between the factors considered and the choice 

made. Id. In short, agency action must be “reasonable and 

reasonably explained.” Communities for a Better 

Environment v. EPA, 748 F.3d 333, 335 (D.C. Cir. 2014).

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As a general rule, the costs of an agency’s action are a 

relevant factor that the agency must consider before deciding 

whether to act. See Michigan, 135 S. Ct. at 2707, slip op. at 

7. In Michigan v. EPA, the Supreme Court was unanimous in 

articulating this principle. The Court divided 5-4 only on 

whether the agency had in fact considered costs. Id. at 2714, 

slip op. at 2-3 (Kagan, J., dissenting) (“I agree with the 

majority – let there be no doubt about this – that EPA’s power 

plant regulation would be unreasonable if the Agency gave 

cost no thought at all.”) (internal quotation marks and 

brackets omitted).

An agency must consider costs because reasoned 

decisionmaking requires assessing whether a proposed action 

would do more good than harm. As the Supreme Court has 

emphasized, the costs imposed by the agency’s action are an 

integral part of that calculus: “Consideration of cost reflects 

the understanding that reasonable regulation ordinarily 

requires paying attention to the advantages and the 

disadvantages of agency decisions.” Id. at 2707, slip op. at 7 

(majority opinion). 

Leading jurists and scholars have long recognized that 

consideration of costs is an essential component of reasoned 

decisionmaking under the Administrative Procedure Act. 

Consider the following:

 Justice Kagan: “[W]hat does it take in a statute 

to make us say, look, Congress has demanded 

that the regulation here occur without any 

attention to costs? In other words, essentially

Congress has demanded that the regulation has 

occurred in a fundamentally silly way.” Tr. of 

Oral Arg. at 13, EPA v. EME Homer City 

Generation, L.P., 134 S. Ct. 1584 (2014).

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 Justice Breyer: “[I]t would make no sense to 

require [power] plants to spend billions to save 

one more fish or plankton. That is so even if the 

industry might somehow afford those billions.” 

Entergy Corp. v. Riverkeeper, Inc., 556 U.S. 208, 

232-33 (2009) (opinion of Breyer, J.) (internal 

quotation marks and citation omitted).

 Justice Breyer: Every agency choice “requires a 

decisionmaker to weigh advantages against 

disadvantages, and disadvantages can be seen in 

terms of (often quantifiable) costs.” Id. at 232.

 Professor Sunstein: “A rational system of 

regulation looks not at the magnitude of the risk 

alone, but assesses the risk in comparison to the 

costs.” Cass R. Sunstein, Interpreting Statutes in 

the Regulatory State, 103 HARV. L. REV. 405, 

493 (1989).

 Professor Pierce: “All individuals and 

institutions naturally and instinctively consider 

costs in making any important decision. . . . [I]t is 

often impossible for a regulatory agency to make 

a rational decision without considering costs in 

some way.” Richard J. Pierce, Jr., The 

Appropriate Role of Costs in Environmental 

Regulation, 54 ADMIN. L. REV. 1237, 1247 

(2002).

To be sure, Congress may bar an agency from 

considering the costs of certain actions. See Whitman v. 

American Trucking Associations, 531 U.S. 457, 464-71 

(2001). But absent a congressional directive to disregard

costs, common administrative practice and common sense 

require an agency to consider the costs and benefits of its 

proposed actions, and to reasonably decide and explain

whether the benefits outweigh the costs.

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In this case, instead of considering the costs and benefits 

of revoking Mingo Logan’s permit, EPA focused like a laser 

on one benefit that would flow from the revocation – namely, 

the prevention of an adverse effect on a few animals, such as 

salamanders, fish, and birds in and near the disposal sites. 

(To reiterate, there was no stated risk to humans or to drinking 

water from Mingo Logan’s disposal of fill material into the 

streams.) 

But EPA ignored the costs to humans caused by the 

revocation of Mingo Logan’s permit, such as the harm to 

Mingo Logan’s owners and shareholders and to the coal 

miners who had been or would be employed at the mine. By 

ignoring costs, EPA in essence discounted the costs to 

humans all the way to zero. That’s how EPA was able to 

conclude that the harm to some salamanders, fish, and birds 

from the mining operation outweighed the loss of jobs for 

hundreds of coal miners, the financial harm to Mingo Logan’s 

owners and shareholders, and the many other costs from

revoking the permit.

EPA ignored the costs to humans because, in EPA’s

view, Congress prohibited the agency from considering costs 

under Section 404(c). Section 404(c), to repeat, authorizes 

EPA to prohibit the disposal of fill material into any disposal 

site if EPA determines that the disposal “will have an 

unacceptable adverse effect on municipal water supplies, 

shellfish beds and fishery areas (including spawning and 

breeding areas), wildlife, or recreational areas.” 33 U.S.C. 

§ 1344(c) (emphasis added). 

According to EPA, the phrase “unacceptable adverse 

effect” bars EPA from considering costs, or may be 

reasonably construed to allow EPA to ignore costs. But EPA 

is badly mistaken. Far from prohibiting EPA from 

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8

considering the costs of its actions, Section 404(c) reinforces 

the agency’s bedrock duty under the Administrative 

Procedure Act to consider costs. 

The word “unacceptable” is capacious and necessarily 

encompasses consideration of costs. Like the word 

“appropriate” at issue in Michigan v. EPA, the words 

“acceptable” and “unacceptable” are commonly understood to 

necessitate a balancing of costs and benefits. See Michigan, 

135 S. Ct. at 2707-08, slip op. at 6-8; cf. Turner v. Murray, 

476 U.S. 28, 36 (1986) (“[W]e find the risk that racial 

prejudice may have infected petitioner’s capital sentencing 

unacceptable in light of the ease with which that risk could 

have been minimized.”). 

To illustrate, suppose that the disposal of fill material 

from a surface mining project is certain to harm some

salamanders. Does the disposal activity have an 

“unacceptable adverse effect” on salamanders? The answer 

would presumably be yes if the disposal activity could be 

prohibited at zero cost – say, if the fill material could just as 

easily be dumped at another site devoid of salamanders. On 

the other hand, the answer would presumably be no if the 

mining project would contribute millions of dollars to the 

local economy and lower the price of electricity. In some 

cases, the question of whether the adverse effect on 

salamanders is “unacceptable” may be a close call. But the 

point for present purposes is that the balance of the benefits of 

reducing the adverse effect on animals and the costs of 

shutting down the mining operation plainly influences the 

determination whether or not the adverse effect is 

“unacceptable.”

Indeed, consider an analogous phrase recently analyzed 

by the Supreme Court: undue burden. See Whole Woman’s 

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9

Health v. Hellerstedt, __ U.S. __ (June 27, 2016). The

Supreme Court explained that in assessing whether a law 

constitutes an “undue burden” on abortion access, courts must 

“consider the burdens a law imposes on abortion access 

together with the benefits those laws confer.” Id. at __, slip 

op. at 19-20. If the word “undue” at issue in Whole Woman’s 

Health requires a balancing of costs and benefits, the word 

“unacceptable” at issue here similarly requires a balancing of 

costs and benefits.

Moreover, even if the word “unacceptable” does not 

unambiguously require EPA to consider costs, it certainly 

allows EPA to consider costs. Cf. Michigan v. EPA, 213 F.3d 

663, 674-79 (D.C. Cir. 2000) (per curiam) (statutory term

“significant” allowed EPA to consider costs). And if the 

word “unacceptable” allows EPA to consider costs, it is 

necessarily unreasonable for EPA not to consider costs. See

Michigan, 135 S. Ct. at 2706-08, slip op. at 5-9. That 

proposition follows from the general reasonableness principle 

embodied in State Farm and Chevron: To act reasonably, an 

agency must consider the costs of its actions unless Congress 

has barred consideration of costs. 

So whether EPA’s interpretation of Section 404(c) is 

analyzed under Chevron step one or Chevron step two or 

State Farm, the conclusion is the same: In order to act 

reasonably, EPA must consider costs before exercising its 

Section 404(c) authority to veto or revoke a permit.

EPA responds that Section 404(c) is more akin to the 

statutory provision at issue in Whitman v. American Trucking

than the provision at issue in the Supreme Court’s Michigan 

v. EPA case. Whitman dealt with a provision of the Clean Air 

Act that directed EPA to set ambient air quality standards at 

levels “requisite to protect the public health” with “an 

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10

adequate margin of safety.” 42 U.S.C. § 7409(b)(1). The 

Court said that the statute precluded EPA from considering 

costs.

EPA advanced the same Whitman-based argument in 

Michigan v. EPA. It failed. Here too, EPA’s reliance on 

Whitman is misplaced. In Whitman, the Court explained that 

the statute specifically focused on “public health” and 

“safety” – two factors on the other side of the balance from 

costs. See Whitman, 531 U.S. at 468-69. The Court found it 

“implausible” that Congress – through the modest words 

“requisite” and “adequate margin” – granted EPA the 

significant power “to determine whether implementation costs 

should moderate national air quality standards.” Whitman, 

531 U.S. at 468. 

Here, by contrast, Section 404(c)’s text – in particular the 

word “unacceptable” – contemplates that costs must be 

considered. So does the statutory context and purpose: After 

all, it would be surprising – shocking, truth be told – if EPA 

did not have to consider costs under Section 404(c) when 

deciding whether to veto or revoke permits.

In short, bedrock principles of administrative law, as well 

as the terms of the statute setting forth EPA’s substantive 

authority to revoke permits, required EPA to consider the 

costs of revoking Mingo Logan’s permit. By failing to do so, 

EPA ignored “an important aspect of the problem.” State 

Farm, 463 U.S. at 43.

B

In this case, moreover, EPA’s failure to consider costs 

was doubly problematic because EPA changed its position in 

2011 by revoking a permit previously issued in 2007. It 

would be bad enough if EPA had merely blocked issuance of 

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11

a Section 404 permit without considering costs. But it is far

worse that here, EPA changed course and revoked a 

previously issued permit without considering costs, including 

the costs of reliance on the permit.

As a general rule, when an agency changes an existing 

policy or changes its position on an issue, the agency “need 

not demonstrate to a court’s satisfaction that the reasons for 

the new policy are better than the reasons for the old one.” 

FCC v. Fox Television Stations, Inc., 556 U.S. 502, 515 

(2009). The agency must show only that there are “good 

reasons” for the new policy or position. Id.

But the Supreme Court has carefully articulated an 

exception to that general principle: An agency must provide a 

“more detailed justification” for a change in position if the 

agency’s prior position “engendered serious reliance 

interests.” Id.; see also Smiley v. Citibank (South Dakota), 

N.A., 517 U.S. 735, 742 (1996). “In such cases it is not that 

further justification is demanded by the mere fact of policy 

change; but that a reasoned explanation is needed for 

disregarding facts and circumstances that underlay or were 

engendered by the prior policy.” Fox, 556 U.S. at 515-16.

The Supreme Court’s recent decision in Encino 

Motorcars, LLC v. Navarro, __ U.S. __ (June 20, 2016), 

illustrates the point. In that case, the Department of Labor 

changed its longstanding interpretation of the Fair Labor 

Standards Act. The retail car and truck dealership industry

had long relied on the Department’s prior interpretation. 

When justifying its change in position, the Department 

nonetheless failed to consider the industry’s reliance. Id. at 

__, slip op. at 2-6, 10. The Supreme Court found the 

Department’s change in course problematic. The Court said

that, in light of the industry reliance on the Department’s prior 

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12

position, “the Department needed a more reasoned 

explanation for its decision to depart” from its prior 

interpretation of the Fair Labor Standards Act. Id. at __, slip 

op. at 10-11.

The Supreme Court requires a “more reasoned” or “more 

detailed” justification in those circumstances because an 

agency change that undermines serious reliance interests 

disrupts settled expectations, thereby imposing a significant 

cost on regulated parties and contravening basic notions of 

due process and fundamental fairness. Here, as elsewhere, the 

law seeks to protect those kinds of settled expectations. Cf.

Landgraf v. USI Film Products, 511 U.S. 244, 265 (1994) 

(“settled expectations should not be lightly disrupted”); Hilton 

v. South Carolina Public Railways Commission, 502 U.S. 

197, 202 (1991) (“Stare decisis has added force when the 

legislature, in the public sphere, and citizens, in the private 

realm, have acted in reliance on a previous decision, for in 

this instance overruling the decision would dislodge settled 

rights and expectations . . . .”).

Put another way, when an agency changes position in a 

way that frustrates reliance interests, the agency’s action is 

more costly to regulated parties than when the agency 

develops a policy or announces a decision on a clean slate, all 

else being equal. This is a commonplace phenomenon in law 

and life. To take one example, declining to hire someone is 

usually less disruptive to the individual than firing someone. 

In the administrative context, the presence of that extra cost –

the reliance cost – triggers a heightened burden of agency 

justification: The agency must consider the reliance cost and 

must justify its action despite that additional cost.

To be sure, as Justice Ginsburg pointed out in her 

concurring opinion in Encino Motorcars, the presence of 

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13

reliance interests does not “pose an insurmountable obstacle” 

to an agency’s desired change in course. Encino Motorcars, 

__ U.S. at __, slip op. at 2 n.2 (Ginsburg, J., concurring). But 

reliance does pose an obstacle. And the agency must take that 

obstacle into account. As Justice Ginsburg put it, the agency 

must determine that “the benefits of [its desired action] 

outweigh those costs.” Id. at __, slip op. at 2.

Reliance interests pose an especially formidable obstacle 

to an agency’s desired change in course in the context of 

government-issued permitting. A government-issued permit 

typically embodies a limited-time bargain between a private 

party and the relevant government agency. If the private 

party complies with the permit’s conditions, the government 

will allow the party to engage in certain conduct – whether 

driving a truck, building a new store, or disposing of fill 

material, for example – for a specified period of time. 

Therefore, the issuance of a permit is typically intended to,

and typically does, engender reliance by the permittee: The 

permit induces the driver to buy a truck, the builder to start 

construction, the miner to invest in its operation.

When a permit induces reliance, it has long been

recognized that those settled expectations should not be 

lightly disturbed by intervening government action. See, e.g.,

Dainese v. Cooke, 91 U.S. 580, 583-84 (1875) (The 

government “should make a clear case of departure from the 

permit, or danger to public interests, before appellant should 

be arrested midway in the construction of the buildings, and 

have them summarily torn down, with all the necessary loss 

and expense to him of such a course.”). For example, under 

the state common law doctrines of “vested rights” and 

“equitable estoppel,” state agencies are often precluded from 

nullifying investments made in reasonable reliance on a valid 

building or development permit. See 2 E. C. Yokley, Zoning 

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Law and Practice § 14-5 (4th ed. 2009); see also, e.g., Avco 

Community Developers, Inc. v. South Coast Regional 

Commission, 553 P.2d 546, 550 (Cal. 1976) (“It has long been 

the rule in this state and in other jurisdictions that if a property 

owner has performed substantial work and incurred 

substantial liabilities in good faith reliance upon a permit 

issued by the government, he acquires a vested right to 

complete construction in accordance with the terms of the 

permit.”).

Here, the Section 404 permit afforded Mingo Logan 24 

years to engage in an activity that was essential to the 

economic viability of its coal mining operation. After 

obtaining its permit in 2007, Mingo Logan spent millions of 

dollars preparing the site for mining operations. Mingo 

Logan’s large expenditures easily qualify as “serious 

reliance” upon the permit. Fox, 556 U.S. at 515. And those 

investments have been rendered all but worthless by EPA’s

2011 decision to revoke the permit. 

Under Fox, because EPA’s change affected “serious 

reliance interests,” EPA needed to provide a “more detailed 

justification” for its revocation of Mingo Logan’s permit. Id. 

And because EPA was revoking a Section 404 permit, EPA’s 

more detailed justification needed to explain why the benefits 

of revoking Mingo Logan’s permit outweighed all of the

relevant costs, including the significant cost of frustrating 

Mingo Logan’s investment-backed reliance on a governmentissued permit. As already discussed, however, EPA did not

even acknowledge the costs of revoking Mingo Logan’s 

permit, much less provide the more detailed justification for 

revoking the permit that is required by Fox.

2

 

2 To be clear, even if an agency were not required to consider 

costs in making an initial decision, Fox would require the agency to 

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II 

To sum up: An agency must consider both costs and 

benefits of a proposed agency action unless Congress has 

barred consideration of costs. When an agency changes 

course by revoking a permit, one cost is the frustration of 

reliance interests. When reliance interests are frustrated in 

that way, the agency must not only consider that cost but must 

also provide a “more detailed justification” for its action

revoking the permit. FCC v. Fox Television Stations, Inc., 

556 U.S. 502, 515 (2009). That more detailed justification 

must consider all of the relevant costs, including the 

frustration of reliance interests. In this case, EPA utterly 

failed to meet those basic Administrative Procedure Act

requirements. 

How does the majority opinion deal with EPA’s failure to 

consider costs? The majority opinion does not address the 

issue. Rather, the majority opinion concludes that Mingo 

Logan forfeited the argument that EPA had to consider and 

justify the costs of revoking the permit. I disagree.

To preserve an issue, a party challenging an agency 

action arising in an administrative adjudication such as this

ordinarily must raise the issue before the agency and, if 

applicable, before the district court. See Shea v. Kerry, 796 

F.3d 42, 56 (D.C. Cir. 2015); Advocates for Highway & Auto 

Safety v. Federal Motor Carrier Safety Administration, 429 

F.3d 1136, 1148 (D.C. Cir. 2005). The majority opinion says 

that Mingo Logan failed to raise its argument about the costs 

of revocation before EPA and again before the district court. 

But in my view, Mingo Logan raised its costs argument in 

both proceedings.

 

consider reliance costs (if any) if and when the agency later 

changed course.

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First, during the EPA proceeding, Mingo Logan 

informed EPA that the agency should consider the costs of the

proposed permit revocation, not just the benefits. In its 

written comments to EPA, Mingo Logan argued that Section 

404(c) of the Clean Water Act requires EPA to consider all 

the costs of revoking a permit: “‘Unacceptable,’ like 

‘significant,’ is a relative term that must be weighed against 

the endangerment of the species, the size of the project, and 

any economic benefit from the project.” Mingo Logan, 

Comments in Response and in Opposition to the 

Recommended Determination of the U.S. Environmental 

Protection Agency Region III 6 n.11 (Nov. 29, 2010)

(emphasis added), at Joint Appendix 712.

Indeed, it is self-evident that Mingo Logan raised a costs 

argument because EPA itself responded to Mingo Logan’s 

costs argument, stating: “[Mingo Logan’s] contention that the 

word ‘unacceptable’ ‘must be weighed against the 

endangerment of the species, the size of the project, and any 

economic benefit from the project’ is without merit.” EPA, 

Final Determination of the U.S. Environmental Protection 

Agency Pursuant to § 404(c) of the Clean Water Act 

Concerning the Spruce No. 1 Mine, Logan County, West 

Virginia app. 6 (Jan. 13, 2011) (hereinafter EPA Final 

Determination), at Joint Appendix 955.

Moreover, Mingo Logan specifically informed EPA of

the costs it had incurred – namely, the significant investments 

that the Company had made in reliance on the permit: “After 

receiving its Section 404 permit, Mingo Logan spent millions 

of dollars preparing the Spruce No. 1 site and commencing its 

operations.” Mingo Logan, Comments in Response and in 

Opposition to the Proposed Determination 33 (June 3, 2010), 

at Joint Appendix 403. Mingo Logan added: “Now, more 

than three years after the issuance of the permit, as Mingo 

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Logan is actively mining the site in an attempt to recoup its 

decade-long investment, EPA has declared that the impacts 

that it had approved are now unacceptable, and seeks to 

revoke the permit.” Mingo Logan, Comments in Response 

and in Opposition to the Recommended Determination of the 

U.S. Environmental Protection Agency Region III 2 (Nov. 29, 

2010), at Joint Appendix 708.

Mingo Logan explained, in addition, that EPA must 

provide a more detailed justification for revoking a Section 

404 permit: Mingo Logan stressed that while “the 404(c) 

standard pre-permit is high; the standard post-permit is even 

higher.” Mingo Logan, Comments in Response and in 

Opposition to the Recommended Determination of the U.S. 

Environmental Protection Agency Region III 8 (Nov. 29, 

2010), at Joint Appendix 714. 

Taken together, Mingo Logan’s allegations were “made 

with sufficient specificity reasonably to alert” EPA that it had 

to consider and justify the costs of revoking the permit. 

Appalachian Power Co. v. EPA, 251 F.3d 1026, 1036 (D.C. 

Cir. 2001).

Second, before the District Court, Mingo Logan 

continued to press the same claim that it had made before 

EPA. Mingo Logan again discussed the “millions of dollars” 

the Company had spent preparing the mining site for 

operations. Amended Complaint at 19, Mingo Logan Coal 

Co. v. EPA, No. 10-541 (D.D.C. Feb. 28, 2011), at Joint 

Appendix 68. And Mingo Logan maintained that “longsettled legal principles” required EPA “to explain a change in 

course” in order to account for the “investment-chilling 

prospect of post-permit action.” Supplemental Brief in 

Support of Mingo Logan’s Motion for Summary Judgment

and in Opposition to EPA’s Motion for Summary Judgment at 

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9, Mingo Logan Coal Co. v. EPA, No. 10-541 (D.D.C. May 

28, 2014). Mingo Logan continued to press that point in a 

hearing before the District Court: “[I]t is a fundamental 

precept of administrative law that an agency can’t just change 

its mind without any reason. We’ve cited several cases in our 

brief. There’s the [State Farm] case, the [Jicarilla] case, that 

if an agency changes its position it has to articulate a reason 

for the change. That’s a fundamental precept of 

administrative law for any change.” Tr. of Motion Hearing at 

9, Mingo Logan Coal Co. v. EPA, No. 10-541 (D.D.C. July 

30, 2014). Mingo Logan therefore raised its costs argument 

before the District Court.

Put simply, Mingo Logan made both a State Farm

argument and a Fox argument. The State Farm argument was 

that EPA had to consider all of the relevant factors, one of 

which was costs. The Fox argument was that the agency had 

to provide a more detailed justification because it was 

changing course and revoking a previously issued permit. As 

a matter of common sense and settled law, those arguments 

required EPA to consider not just the benefits of revoking the 

permit, but also the costs. How else could EPA perform its 

duty under State Farm and Fox without considering the 

downside costs as well as the upside benefits of revoking the 

permit? See Michigan v. EPA, 135 S. Ct. 2699, 2707, slip op. 

at 7 (2015) (“Consideration of cost reflects the understanding 

that reasonable regulation ordinarily requires paying attention 

to the advantages and the disadvantages of agency 

decisions.”). 

The majority opinion concludes that Mingo Logan 

forfeited its costs argument for two distinct reasons. 

First, the majority opinion says that Mingo Logan failed 

to make a costs argument at all. But the majority opinion 

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acknowledges, as it must, that Mingo Logan preserved the 

argument that “EPA is subject to a heightened standard to 

justify its withdrawal decision.” Maj. Op. at 22. The majority 

opinion nonetheless says that “Mingo Logan’s post-permit 

heightened-standard claim does not preserve its reliance-costs 

claim.” Id. at 23. 

That makes little sense to me. Those are one and the 

same argument. After all, EPA must provide a more detailed 

justification post-permit, as the Supreme Court has carefully 

explained many times, precisely because a revocation (that is, 

a change in position) frustrates reliance interests. See Fox, 

556 U.S. at 515. So when Mingo Logan argued that EPA had 

to provide a more detailed justification for its revocation 

decision – an argument that the majority concedes Mingo 

Logan has preserved – Mingo Logan necessarily made the 

lesser-included argument that EPA had to consider costs. 

Again, the agency could not perform its duty under State 

Farm or Fox without considering costs.

To illustrate the point, assume that when EPA decided 

not to veto the permit, EPA believed that the loss of one coal 

miner’s future job was a tolerable cost so long as two 

salamanders were saved. Once the permit was issued, the 

coal miner was hired and investments were made in the 

mining operation. So when EPA decided to revoke the 

permit, EPA had to explain how its calculus changed given 

that its revocation decision would cause the loss of existing

jobs – not just hypothetical future ones – and existing

investments. That’s what providing a “more detailed 

justification” entails in this context. Fox, 556 U.S. at 515. 

EPA could not rationally provide a more detailed justification

in this case without considering costs. Therefore, Mingo 

Logan necessarily made a costs argument when it asked EPA 

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to provide a more detailed justification for its revocation 

decision.

Second and alternatively, the majority opinion suggests 

that even if Mingo Logan did raise an argument about costs, 

Mingo Logan “failed to detail” its reliance costs. Maj. Op. at 

21. In the end, this seems to be the crux of the majority 

opinion’s objection. To begin with, even on its own terms,

that objection fails. Mingo Logan told the agency that it had 

spent “millions of dollars” in reliance on the permit. That is 

at least $2 million. Moreover, EPA knew that the costs of 

revocation to Mingo Logan were significant. After all, in its 

decision revoking the permit, EPA itself “recognize[d] that 

Mingo Logan has made significant investments in planning 

for operations at the Spruce No. 1 Mine.” EPA Final 

Determination at app. 6, at Joint Appendix 1236. At that 

time, EPA further noted that the “Spruce No. 1 Mine . . . is 

one of the largest mountaintop mining projects ever 

authorized in West Virginia.” Id. at 15, at Joint Appendix 

806. EPA should have weighed the costs of revocation in the 

balance. It did not do so.

There is also a far more fundamental problem with the 

majority opinion’s argument that Mingo Logan failed to detail 

its costs. EPA’s legal theory throughout these proceedings 

has been that costs are irrelevant to permit revocation 

decisions. Yet now EPA is faulting Mingo Logan for not 

adequately detailing its costs to the agency. That’s a bit rich. 

It is not as if EPA said it would consider costs and then 

Mingo Logan failed to present evidence. Rather, as reflected 

in its decision revoking the permit, EPA made clear that costs 

were irrelevant and said it would make its decision based 

solely on the adverse effect on animals. See id. at app. 6, at 

Joint Appendix 955. It flatly violates SEC v. Chenery for 

EPA now to rely on Mingo Logan’s supposed failure to detail 

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its costs when EPA (over Mingo Logan’s objection) said at 

the agency stage and in the District Court that costs were 

irrelevant. See SEC v. Chenery Corp., 318 U.S. 80 (1943); 

SEC v. Chenery Corp., 332 U.S. 194 (1947). The forfeiture 

argument advanced by EPA (and accepted by the majority 

opinion) about Mingo Logan’s supposed failure to detail costs

is entirely unfair to Mingo Logan. I would not countenance 

this kind of agency bait and switch.

To be clear, the question whether Mingo Logan failed to 

adequately detail its costs is distinct from the question 

whether, in the first place, Mingo Logan sufficiently raised an 

argument that EPA needed to consider costs. Mingo Logan 

clearly raised a costs argument as part of its State Farm/Fox

argument. If EPA thought that Mingo Logan failed to 

adequately support its costs estimate as an evidentiary matter, 

perhaps that could have been a basis for EPA to conclude that 

the benefits of revocation outweighed the apparent costs of 

revoking the permit. But EPA never said any such thing. 

EPA did not engage in cost-benefit balancing at all. EPA said 

costs were irrelevant.

In short, Mingo Logan argued to both EPA and the 

District Court that EPA had to consider all of the relevant 

factors (State Farm) and provide a more detailed justification 

because it was changing position and revoking a permit on 

which Mingo Logan had relied (Fox). Mingo Logan 

preserved the argument that EPA had to consider costs, 

including reliance costs.

* * *

The Corps issued a 24-year permit to Mingo Logan, but

EPA then revoked the permit four years later. In revoking the 

permit, EPA considered the benefits to animals, but none of 

the costs to humans. Because that cost-blind approach does 

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not satisfy EPA’s duty of reasoned decisionmaking, and 

because Mingo Logan adequately raised that issue, I would 

direct the District Court to vacate EPA’s revocation decision

and to remand to EPA for the agency to consider the benefits 

and costs of its proposed revocation, and to supply a “more 

detailed justification” for revoking the permit. Fox, 556 U.S. 

at 515. I respectfully dissent.

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