Supreme Court Rules Against EPA in Sackett Case

The big environmental news of the day was the Supreme Court's decision in Sackett v. EPA. We are preparing a longer Briefing on this important case, but wanted to share our preliminary thoughts in the interim.

In a decisive and unanimous opinion, the Court dealt a harsh blow to EPA's use of administrative compliance orders under the Clean Water Act, by holding that these orders are subject to pre-enforcement judicial review under the Administrative Procedure Act (APA). EPA uses administrative compliance orders for violations it views as continuing or likely to recur. The Agency generally relies upon these orders to induce alleged violators to "voluntarily" come into immediate compliance due to the threat of significant civil penalties being imposed in a subsequent enforcement action for not only the alleged violation, but also a violation of the compliance order.

The underlying issue in the case involved fill work performed by Chantell and Michael Sackett in preparation for the construction of their home. EPA issued an administrative compliance order alleging that the Sacketts' property contained wetlands subject to Clean Water Act jurisdiction and that the Sacketts had discharged fill material into wetlands without a Section 404(a) permit. The Sacketts sought pre-enforcement judicial review of the compliance order on the basis that their property was not subject to the Clean Water Act.

The Court did not decide the merits of whether the Sacketts' property was subject to Clean Water Act jurisdiction. Instead, the Court's decision was limited to holding that EPA's compliance order was a final agency action, and that the Clean Water Act does not preclude judicial review of such orders. In his concurring opinion, Justice Alito lamented the seemingly limitless reach of the Clean Water Act and called upon Congress or EPA to clearly define the meaning of "waters of the United States." Justice Alito's concurrence suggests that the draconian nature of the compliance order, and the fact that private property rights were at jeopardy, contributed at least in part to the Court's decision.

As a result of Sackett, we expect that EPA will be less likely to issue administrative compliance orders under the Clean Water Act, and perhaps other statutes as well. At the very least, the Agency will be forced to re-evaluate the circumstances in which it is appropriate to issue these orders, and ensure that any such orders can withstand judicial scrutiny. As the Court noted, "[c]ompliance orders will remain an effective means of securing prompt voluntary compliance in those many cases where there is no substantial basis to question their validity."