The first case on the U.S. Supreme Court’s (SCOTUS) 2022 fall docket was Sackett v. EPA, which asked the Court to consider scaling back the EPA’s authority to regulate some types of wetlands under the Clean Water Act (CWA).

One of the main issues in the case is to determine which test courts should use to decide which waters are “waters of the United States” (WOTUS).

“The answer will help determine whether wetlands adjacent to navigable waters fall within the EPA's purview, which would subject the property to regulation and force owners to obtain federal permits to carry out construction,” says Reuters.

Background

Mike and Chantell Sackett’s battle with the EPA began back in 2007 after they purchased roughly two-thirds of an acre near Priest Lake in northern Idaho in anticipation of building a home. After purchasing the property, which is located about 300 feet from the state’s largest lake, the couple received county building permits in 2007 and filled the property area with sand and gravel.

Shortly thereafter, EPA officials inspected the property and said construction must stop because it was subject to wetlands protection under the CWA. The Sacketts were told they’d need a permit from the U.S. Army Corps of Engineers to continue construction.

“The couple refused to comply with EPA’s directive, prompting the agency to issue its initial compliance order in November 2007,” says Inside Climate News. “The agency concluded that the property contained wetlands subject to [CWA] regulations and that the Sacketts had illegally placed fill material on the property. The couple was ordered to remove the material and undertake restoration work by the end of April in 2008. Failure to comply would result in tens of thousands of dollars in administrative and civil penalties, they were told. The couple instead sued the EPA and sought a judicial review of whether the agency correctly determined that their property contained wetlands under the [CWA].”

The problem with WOTUS

The CWA regulations were designed to protect navigable waters, defined by the CWA as WOTUS.

One core provision in the CWA is the ban of the unauthorized “discharge of any pollutant,” which includes “any addition of any pollutant to navigable waters from any point source.” Other provisions within the Act hinge upon the “navigable waters” concept. For example, there is a requirement for states to biennially report on the quality of those waters.

“The term effectively establishes the boundaries of the authority granted to EPA and the Army Corps of Engineers (Corps) under the CWA,” says a JD Supra article by Sullivan & Worcester LLP. “The CWA does not, however, appear to use the term ‘navigable waters’ in one of its ordinary senses, such as ‘deep enough and wide enough to afford passage to ships.’ Instead, it defines it as ‘[WOTUS], including the territorial seas,’ a rather ambiguous term that seems to imply something broader than literally navigable bodies of water.”

So, the problem is that “WOTUS” was never clearly defined by Congress, and different presidential administrations have interpreted the term broadly or narrowly, depending upon their political affiliations.

Different definitions

The Obama administration attempted to define WOTUS by expanding its definition to clarify which bodies of water are automatically covered by the CWA and which must still be dealt with on a case-by-case basis. That rule defined automatically protected waterways as any that have a bed, a bank, and a high-water mark, according to VOX. This included many streams that remain dry part of the year.

The Trump administration’s definition made a clear distinction between federally protected wetlands and state-protected wetlands. Its definition of WOTUS pulled “back federal oversight of at least 51 percent of wetlands and 18 percent of streams — many of which had been protected since the Reagan administration,” according to E&E News.

For many, the Obama administration’s definition was overreaching, and the Trump administration’s definition did too little.

Both Obama’s and Trump’s WOTUS definitions were extremely controversial and the subject of multiple court battles.

The current definition of WOTUS is very broad, defining the term to mean any body of water (even tiny ones) connected to navigable waters to be subject to CWA regulations.

The hotly debated WOTUS definition is one of the major underlying issues at the heart of the Sackett case.

Judicial precedents

Three different U.S. Supreme Court (SCOTUS) cases have addressed the definition of WOTUS.

• In the 1985 United States v. Riverside Bayview Homes, Inc. case, SCOTUS “deferred to the Corps’ assertion of jurisdiction over wetlands actually abutting a traditional navigable water, stating that adjacent wetlands may be regulated as waters of the United States because they are ‘inseparably bound up’ with navigable waters and ‘in the majority of cases’ have ‘significant effects on water quality and the aquatic ecosystem’ in those waters.”
• In the 2001 Solid Waste Agency of Northern Cook County v. U.S. Army Corps of Engineers (SWANCC) case, SCOTUS determined there was no federal jurisdiction “over nonnavigable, isolated, intrastate ponds that lack a sufficient connection to traditional navigable waters. …”
• In the 2006 Rapanos v. United States case, a four-Justice SCOTUS plurality determined WOTUS ‘‘include[ ] only those relatively permanent, standing or continuously flowing bodies of water ‘forming geographic features’ that are described in ordinary parlance as ‘streams ... oceans, rivers, [and] lakes’” and ‘‘wetlands with a continuous surface connection’’ to a ‘‘relatively permanent body of water connected to traditional interstate navigable waters.’’

However, Justice Anthony Kennedy wrote a lone concurring opinion that concluded ‘‘to constitute ‘navigable waters’ under the Act, a water or wetland must possess a ‘significant nexus’ to waters that are or were navigable in fact or that could reasonably be so made.’’

The term “significant nexus” is defined as waters that form a sufficiently great central link or connection. It’s similar to standing in the middle of a large intersection.

Regarding the above “precedent-setting” cases, instead of following Justice Antonin Scalia’s plurality opinion that narrowly interpreted “navigable waters,” lower courts and the government “uniformly followed Justice Kennedy’s lone opinion, which interpreted the term expansively but very vaguely,” according to Pacific Legal Foundation.

Sackett case legal history and position

When the Sacketts challenged the EPA order to remove the sand and gravel in 2008 in federal district court and later in the 9th Circuit Court of Appeals, the EPA prevailed with a legal argument on the grounds of a lack of subject matter jurisdiction. The Sackett defense team took the matter to SCOTUS in 2012, which unanimously held the Sacketts had the right to challenge the compliance order in a civil action under the Administrative Procedure Act (APA).

“On remand, both lower courts ruled for EPA on the merits, with the Ninth Circuit, deciding the case in August 2021, explicitly applying Justice Kennedy’s ‘significant nexus’ test from Rapanos,” says Sullivan & Worcester.

In January 2022, SCOTUS again agreed to hear the case.

It’s possible that SCOTUS will decide the case based upon the “major questions” doctrine, which requires agencies to point to “clear congressional authority” for any authority they claim. This is the position the high court took in West Virginia v. EPA when it ruled the EPA had overstepped its authority in trying to regulate fossil fuel energy generation into extinction. That decision left it up to Congress to provide the EPA with more precise authority under the Clean Air Act (CAA) in the future.

The Sackett defense team’s briefs describe the CWA as overly burdensome and as a regulation that gives the EPA too much authority. These are similar arguments as the ones raised in West Virginia.

EPA position

The federal government’s defense team elevated the “significant nexus” concept “mentioned by a single Justice in a prior case as the favored test to determine jurisdiction over a water based on its relationship with traditionally regulated waters,” states an Associated General Contractors of America (AGC) news article.

The EPA defense also contends ecological grounds in that “wetlands affect ‘the chemical, physical, and biological integrity’ of downstream waters by performing essential water-quality functions,” Sullivan & Worcester continues. “Further, the respondents will defend the significant-nexus test on the grounds that ‘application of the test reflects the empirical judgments that scientists routinely make’ and that the agencies’ experience of applying the test over more than ten years demonstrates its workability.”

SCOTUS questions

Questions asked by the high court justices offer clues about the issues the justices will debate in making their determination in the case.

This case marked the first heard by President Joe Biden’s appointee, Ketanji Brown Jackson, who stated her questions were asked to “‘try to bring some enlightenment’ to the question of what Congress intended in the [CWA],” says Reuters.

Conservative Justice Samuel Alito remarked that WOTUS is a "cryptic phrase, a strange phrase,” Reuters adds.

While the justices “seemed to lean toward favoring the plaintiffs, some conservative justices signaled skepticism toward the notion that the EPA under the [CWA] could never police wetlands like swamps, marshes and berms that are near but not connected to regulated waters, as a lawyer for the plaintiffs argued,” continues Reuters.

One problem concerning the justices appears to be vagueness within the CWA, which does not specify the exact proximity of a wetland for it to be classified as a navigable water, particularly because EPA penalties involve extensive criminal and civil penalties.

“If the federal government doesn't know, how is a person subject to criminal time in federal prison supposed to know?” Justice Neil Gorsuch asked.

“Damien Schiff, a lawyer for the Sacketts, argued that his clients could not know - and that the justices should adopt a test for determining when wetlands fall under the EPA's oversight that counts only those that have a continuous surface-water connection to navigable waters,” according to Reuters. “Conservative Justice Brett Kavanaugh noted that the EPA under Democratic and Republican presidents has for decades agreed that some wetlands that are merely adjacent to regulated waters, like berms and dams, count.

“‘Why did seven straight administrations not agree with you?’ Kavanaugh asked Schiff.

“Jackson, in questions that aligned her with fellow liberal Justices Elena Kagan and Sonia Sotomayor, questioned how the Sacketts' arguments matched up with what Congress intended when it passed the law.

"Why would Congress draw the coverage line between abutting wetlands and neighboring wetlands when the objective of the statute is to ensure the chemical, physical and biological integrity of the nation's waters?” Jackson asked, according to Reuters.

Analysts agree that the questions asked by the SCOTUS justices indicate the high court is open to debating deficiencies in the significant nexus test and deliberating alternatives tests to decide the adjacency concept.

Industry takeaways

The AGC states its “primary concerns with WOTUS are to ensure regulatory clarity and common sense over what waters are under federal jurisdiction, especially given there are criminal and civil penalties at play when something goes wrong.  Furthermore, the federal permitting process can be time consuming and costly. … [T]he [EPA] will ultimately interpret and apply the [SCOTUS] decision. EPA is currently rewriting the definition of WOTUS. The first step in that process will likely be final before we have resolution in the Sackett’s case. If the final rule adheres to the proposed version, EPA will ‘double down’ on the significant nexus test.”

A clear prediction regarding the outcome of the Sackett case cannot be determined. The SCOTUS decision is due by the end of June 2023.