On October 9th, the U.S. Court of Appeals for the Sixth Circuit issued a nationwide stay precluding implementation of controversial new rules issued by the Environmental Protection Agency (EPA) and the U.S. Army Corps of Engineers (COE) in May defining the scope of “waters of the United States” (WOTUS) that are subject to Federal regulatory jurisdiction under the Clean Water Act (CWA). The agencies’ characterized the new rules as an attempt to clarify the scope of Federal jurisdiction under 2001 and 2006 decisions of the United States Supreme Court.  In those cases, the Court determined that the two agencies were implementing an unduly broad interpretation of the statute and their authority under it.   

Following issuance of the new rules, many lawsuits challenging the rules were filed in several U.S. Courts of Appeals and U.S. District Courts by a number of States, industries and associations.  One of the District Courts, in North Dakota, issued a stay of the rules in August covering the thirteen western States in that lawsuit.  The judge declined to extend the stay nationwide.   

The reason for filings in both Courts of Appeals and District Courts is that jurisdiction under the CWA to hear legal challenges to the rules is unclear.  Consequently, the question of whether or not the Sixth Circuit has authority to issue the nationwide stay is not settled.  This uncertainty resulted in a split among the three judges on the Circuit’s panel issuing the stay.  Two of the three judges concluded that the stay should be issued pending resolution of the jurisdictional question.  The third judge dissented, arguing the Circuit should not issue a stay without a determination that the court has jurisdiction.   

To support issuance of the stay, the majority on the panel concluded that challengers to the WOTUS rule have shown a sufficient likelihood of prevailing on the merits in their challenges, justifying issuance of the stay:  “[P]etitioners have demonstrated a substantial possibility of success on the merits of their claims.  Petitioners . . . claim that the Rule’s treatment of tributaries, “adjacent waters,” and waters having a “significant nexus” to navigable waters is at odds with the Supreme Court’s ruling in Rapanos, where the Court vacated the Sixth Circuit’s upholding of wetlands regulation by the Army Corps of Engineers . . . Even assuming . . . that Justice Kennedy’s opinion in Rapanos represents the best instruction on the permissible parameters of “waters of the United States” . . . it is far from clear that the new Rule’s distance limitations are harmonious with the instruction.  . . . Moreover, the rulemaking process by which the distance limitations were adopted is facially suspect.”   

The majority concluded that the status quo pending resolution of challenges to the rule should be maintained while the litigation proceeds:  “[O]f greater concern to us, in balancing the harms, is the burden – potentially visited nationwide on governmental bodies, State and Federal, as well as private parties – and the impact on the public in general . . . [is] redrawing of jurisdictional lines over certain of the nation’s waters . . . [While] . . . we appreciate the need for the new Rule [and] . . . [w]e accept that respondent agencies have conscientiously endeavored, within their technical expertise and experience . . . to promulgate new standards to protect water quality that conform to the Supreme Court’s guidance . . . the sheer breadth of the ripple effects caused by the Rule’s definitional changes counsels strongly in favor of maintaining the status quo for the time being.”   

Ironically, some of the parties to the Sixth Circuit cases – where all legal challenges filed in Courts of Appeals have been consolidated – are arguing that challenges to the rules should be heard in a District Court and not in a Court of Appeals.  Briefing on the jurisdictional issue will now proceed with a decision by the panel in the next few months.