Opinion ID: 3179273
Heading Depth: 4
Heading Rank: 1

Heading: Subsection (E) – “Other Limitation”

Text: Movants contend the Rule’s definition of “waters of the United States” is not, under § 1369(b)(1)(E), “an effluent limitation or other limitation” approved or promulgated under 33 U.S.C. § 1311, 1312, 1316, or 1345. “Effluent limitation” is defined as “any restriction established by a State or the Administrator on quantities, rates, and concentrations of chemical, physical, biological, and other constituents which are discharged from point sources into navigable waters, the waters of the contiguous zone, or the ocean, including schedules of compliance.” 33 U.S.C. § 1362(11). The Agencies do not contend that the Clean Water Rule is an action in approving or promulgating an effluent limitation, but rather that it is an “other limitation.” The Act does not define “other limitation.” Inasmuch as “effluent limitation” is defined as a “restriction” on discharges from point sources, the Agencies contend “other limitation” must be understood as a different kind of “restriction.” They contend the Rule’s clarification of the scope of “waters of the United States” protected under the Clean Water Act constitutes an “other limitation” in two respects. First, it has the effect of restricting the actions of property owners who discharge pollutants from a point source into covered waters. Second, it has the effect of imposing limitations or restrictions on regulatory bodies charged with responsibility for issuing permits Nos. 15-3751, et al. In re: U.S. Dep’t of Defense & U.S. Envtl. Protection Agency Final Page 7 Rule: Clean Water Rule under the National Pollutant Discharge Elimination System (“NPDES”) to those who discharge pollutants into covered waters. On its face, the Agencies’ argument is not compelling. After all, the Rule’s clarified definition is not self-executing. By clarifying the definition, the Agencies did not approve or promulgate any limitation that imposes ipso facto any restriction or requirement on point source operators or permit issuers. Rather, they promulgated a definitional rule that, operating in conjunction with other regulations, will result in imposition of such limitations. Is such an indirect consequence sufficient to bring the Rule within the scope of § 1369(b)(1)(E)? The Agencies say yes and cite several cases in support. The seminal case supporting their construction of subsection (E) is E.I. du Pont de Nemours Co. v. Train, 430 U.S. 112, 136 (1977), where the Supreme Court eschewed a strict, literal reading. The Court characterized a construction that would provide for direct circuit court review of individual actions issuing or denying permits, but disallowed such review of the “basic regulations governing those individual actions,” as a “truly perverse situation.” Id. Hence, even though § 1369(b)(1) provided for circuit court review only of limitations promulgated under certain enumerated sections, and the challenged regulation was promulgated under a different section—which was, however, closely related to one of the enumerated sections—the Court had “no doubt that Congress intended review of the two sets of regulations to be had in the same forum.” Id. at 136–37. The Court thus construed § 1369(b)(1)(E), in light of Congress’s manifest intent, to encompass review of more agency actions than a literal reading of the provision would suggest. E.I. du Pont can be read in more ways than one. As the Agencies see it, the Clean Water Rule is a “basic regulation governing those individual actions” taken by the EPA Administrator (e.g., promulgation of limitations) that are subject to direct circuit court review. Accordingly, giving § 1369(b)(1) a practical construction per E.I. du Pont, the Agencies argue that Congress intended the lawfulness of the Clean Water Rule to be subject to direct circuit court review. Their position finds support in several decisions of our sister circuits. In Nat. Res. Def. Council v. U.S. E.P.A., 673 F.2d 400 (D.C. Cir. 1982) (J. Ginsburg), a case closely analogous to ours, the D.C. Circuit addressed numerous consolidated challenges to EPA regulations that had Nos. 15-3751, et al. In re: U.S. Dep’t of Defense & U.S. Envtl. Protection Agency Final Page 8 Rule: Clean Water Rule been filed in circuit courts of appeals and district courts. The regulations did not establish any numerical limitations, but prescribed permitting procedures that constituted “a limitation on point sources and permit issuers and a restriction on the untrammeled discretion of the industry.” Id. at 405 (internal quotation marks omitted). Following E.I. du Pont, the court held this “limitation” was sufficient to bring the regulations within the ambit of direct circuit court review under § 1369(b)(1)(E). Employing “a practical rather than a cramped construction,” the court held that direct review in the circuit court was appropriate, even though the regulations did not impose technical requirements but were “far more general and rest[ed] dominantly on policy choices.” Id. In fact, the court cited several reasons for concluding that such “broad, policy-oriented rules” are actually more suitable for direct circuit court review than “specific technology-based rules.” Id. at 405 n.15. The court noted that E.I. du Pont “does not unequivocally dictate our result but [its] reasoning strongly supports our holding that we have jurisdiction.” Id. at 406. In Virginia Elec. & Power Co. v. Costle, 566 F.2d 446 (4th Cir. 1977) (“VEPCO”), the Fourth Circuit addressed consolidated petitions challenging EPA regulations prescribing requirements for the location, design, construction and capacity of cooling water intake structures used to withdraw from, rather than discharge into, covered waters. The challengers argued that such requirements could not be “other limitations” under § 1369(b)(1)(E) until they were actually adopted in an individual permit proceeding. Because the requirements were not self-executing, the challengers argued they were only presumptively applicable and did not actually impose any limitation or restriction on point-source discharges. The court held the argument was foreclosed by E.I. du Pont. VEPCO, 566 F.2d at 449–50. The court held the requirement that certain information be considered in determining the best available technology for intake structures was a sufficient restriction on the discretion of point source operators and permit issuers to constitute an “other limitation” under subsection (E). Id. Further, citing E.I. du Pont, the court noted the regulations were so closely related to effluent limitations, that “it would be anomalous to have their review bifurcated between different courts.” Id. at 450. The court held that circuit court review was proper under subsection (E), stating that “this result is consistent with the jurisdictional scheme of the Act, which in general leaves review of standards of nationwide applicability to the courts of appeals, thus furthering the aim of Congress to achieve nationally uniform standards.” VEPCO, 566 F.2d at 451. Nos. 15-3751, et al. In re: U.S. Dep’t of Defense & U.S. Envtl. Protection Agency Final Page 9 Rule: Clean Water Rule More recently, the Eighth Circuit followed suit. In Iowa League of Cities v. U.S. E.P.A., 711 F.3d 844 (8th Cir. 2013), the court addressed two letters from the EPA sent to a senator and alleged to have effectively established new regulatory standards governing municipal water treatment processes. The court first noted that “the Supreme Court has recognized a preference for direct appellate review of agency action pursuant to the APA.” Id. at 861 (citing Fla. Power, 470 U.S. at 745). The court rejected the EPA’s contention that the subject letters, couched in terms of what “should not be permitted” by regulated entities, did not “promulgate” a binding limitation. Noting that the EPA had characterized the letters as expressing its position or policy, the court dismissed the notion that the instruction was not binding as “Orwellian Newspeak.” Id. at 865. The court did not cite E.I. du Pont, but adopted the VEPCO formulation of “limitation” and went on to hold that subsection (E) applies if “entities subject to the CWA’s permit requirements face new restrictions on their discretion with respect to discharges or dischargerelated processes.” Id. at 866. These decisions from the D.C., Fourth, and Eighth Circuits demonstrate courts’ willingness to view E.I. du Pont as license to construe Congress’s purposes in § 1369(b)(1) more generously than its language would indicate.2 However, movants herein read E.I. du Pont differently. They argue E.I. du Pont’s holding is narrower and should be limited to its facts. In support they cite decisions from the Eleventh and Ninth Circuits refusing to find circuit court jurisdiction under subsection (E). In both Friends of the Everglades v. U.S. E.P.A., 699 F.3d 1280, 1287 (11th Cir. 2012), and Northwest Environmental Advocates v. U.S. E.P.A., 537 F.3d 1006, 1015–16 (9th Cir. 2008), the courts reached results different from those reached in the D.C., Fourth, and Eighth Circuits. However, the decisions in all five circuits are readily reconcilable. In both Friends of the Everglades and Northwest Environmental, the courts acknowledged the above discussed NRDC and VEPCO rulings, but found the regulations before them materially distinguishable from those deemed to come within the scope of § 1369(b)(1)(E). Far from restricting “untrammeled 2 Most recently, the “functional approach” employed in these cases was applied by two district courts in relation to the Clean Water Rule in this litigation to find circuit court jurisdiction under subsection (E). Murray Energy Corp. v. U.S. E.P.A., 2015 WL 5062506 (N.D. W.Va. Aug. 26, 2015); State of Georgia v. McCarthy, 2015 WL 5092568 at –3 (S.D. Ga. Aug. 27, 2015). Nos. 15-3751, et al. In re: U.S. Dep’t of Defense & U.S. Envtl. Protection Agency Final Page 10 Rule: Clean Water Rule discretion,” the regulations at issue in Friends of the Everglades and Northwest Environmental actually created exemptions from limitations. Both courts concluded that an exemption from limitation simply cannot be fairly characterized as a limitation. Neither court criticized the approach adopted in E.I. du Pont and applied in NRDC and VEPCO. Nor did either court reject the notion that an “other limitation” can be made out by an indirect restriction on discretion. Rather, Friends of the Everglades and Northwest Environmental held that no construction could render an exemption from limitation what it plainly is not: a “limitation” under subsection (E).3 The two lines of authority are therefore not inconsistent. Here we acknowledge that the Rule is definitional only and does not directly impose any restriction or limitation. Yet, neither does the Rule create an exemption from limitation. By clarifying the definition of “waters of the United States,” the Rule undeniably has the indirect effect of altering permit issuers’ authority to restrict point-source operators’ discharges into covered waters. The alteration invariably results in expansion of regulatory authority in some instances and imposition of additional restrictions on the activities of some property owners. These restrictions, of course, are presumably the reason for petitioners’ challenges to the Rule. Hence, although the Rule is definitional in nature, it is undeniably, in the language of E.I. du Pont, a “basic regulation governing other individual actions issuing or denying permits.” 430 U.S. at 136. To rule that Congress intended to provide direct circuit court review of such individual actions but intended to exclude from such review the definitional Rule on which the process is based, would produce, per E.I. du Pont, “a truly perverse situation.” Id. To avoid just such an outcome, the E.I. du Pont Court reasoned that Congress must have intended that both types of regulation would be subject to review in the same forum, i.e., the circuit courts.4 3 These authorities were cited as persuasive in this litigation by one district court. North Dakota v. U.S. E.P.A., 2015 WL 5060744 at  (D. N.D. Aug. 27, 2015). However, the North Dakota court ignored the fact that, unlike the regulations at issue in those cases, the Clean Water Rule does not create an exemption. And despite noting the pertinence of the NRDC-VEPCO-Iowa League line of cases, the North Dakota court conspicuously ignored their holdings. 4 E.I. du Pont’s analysis is also dispositive of movants’ argument that review under subsection (E), by its terms, applies only to action by the EPA Administrator approving or promulgating a limitation “under section 1311, 1312, 1316, or 1345 of this title.” Movants contend that all of these sections pertain to effluent limitations. Inasmuch as the Agencies do not even argue that the Clean Water Rule represents an effluent limitation, movants contend the Rule cannot be deemed to have been promulgated under any of these sections. Nos. 15-3751, et al. In re: U.S. Dep’t of Defense & U.S. Envtl. Protection Agency Final Page 11 Rule: Clean Water Rule E.I. du Pont is the last word from the Supreme Court on § 1369(b)(1)(E). It is still good law. Our sister courts in the D.C., Fourth, and Eighth Circuits have all applied E.I. du Pont’s approach and have defined the scope of direct circuit court review under subsection (E) more broadly than a strict interpretation of its language would indicate. The two circuit-level decisions, from the Ninth and Eleventh Circuits, that declined to find circuit court jurisdiction under subsection (E) did so in relation to agency action materially distinguishable from the Rule here at issue. The movants’ position is thus devoid of substantial case law support. While their plain-language arguments are not without facial appeal, we are hardly at liberty to ignore the consistent body of case law that has sprung from that language in encounters with the real world. In response to concern about producing a “perverse situation” seemingly at odds with congressional purpose, movants have no answer beyond their argument that Congress must be held to say what it means and mean what it says. Were we writing on a blank slate, the argument would be more persuasive, but we’re not. As an “inferior court,” we are obliged to take our lead from the Supreme Court. Having discerned no persuasive grounds to depart from the rationale that controlled in E.I. du Pont, I conclude that we, like our sister circuits, must follow its lead. Viewing the Clean Water Rule through the lens created in E.I. du Pont reveals a regulation whose practical effect will be to indirectly produce various limitations on point-source operators and permit issuing authorities. Accordingly, although the Rule does not itself impose any limitation, its effect, in the regulatory scheme established under the Clean Water Act, is such as to render the Rule, per the teaching of E.I. du Pont and its progeny, subject to direct circuit court review under § 1369(b)(1)(E).