On March 20, 2013, the U.S. Supreme Court issued an opinion in Decker v. Northwest Environmental Defense Center that addresses the issue of "whether the Clean Water Act and its implementing regulations require permits before channelized stormwater runoff from logging roads can be discharged into Waters of the United States."1
In a 7-1 opinion written by Justice Kennedy, the Court reversed the ruling of U.S. Court of Appeals for the Ninth Circuit and upheld the Environmental Protection Agency’s (EPA) interpretation of its Silviculture Rule2 exempting such discharges from the Clean Water Act's ("CWA") permitting requirements. In so ruling, the Court held that future CWA citizen suits may be filed to enforce an obligation under an ambiguous EPA rule that conflicts with EPA's own interpretation where the suit is brought after the time period under the Act had passed for reviewing the underlying regulation.
The Court also upheld EPA's interpretation of its silviculture regulation, reaffirming the regulatory deference principle of Administrative Law over a strong dissent by Justice Scalia. As such, the decision has potentially broad implications for the regulated community beyond the specific silvicuture rule at issue here.
The case arose out of Georgia Pacific-West (GPW) contracts with the state of Oregon to harvest timber from a state forest.3 As the Court noted, runoff from two logging roads during those activities enters ditches, culverts and channels and then discharges the water into nearby rivers and streams.4 These discharges often contain large amounts of sediment, which evidence suggests may be harmful to fish.5
Northwest Environmental Defense Center (NEDC) filed suit against GPW and various state and local government officials under the CWA’s citizen-suit provision,6 alleging that the defendants failed to obtain permits required by EPA’s National Pollutant Discharge Elimination System ("NPDES").7 The District Court dismissed the action, concluding that the discharges did not trigger the NPDES permitting requirement because they failed to fit the definition of a "point source" under the CWA and its implementing regulations.8
The Ninth Circuit reversed the District Court on two grounds, concluding that the discharges were not exempt from the NPDES permitting scheme.9 First, it held that the ditches, culverts and channels were "point sources" under the Silviculture Rule.10 Second, the Ninth Circuit concluded that the discharges were "associated with industrial activity" under the EPA’s Industrial Stormwater Rule ("ISR") — despite EPA’s contrary conclusion that the ISR excludes this type of stormwater discharges from logging roads.11
The Majority Opinion
Justice Anthony Kennedy’s majority opinion, joined by seven justices,12 first addressed an important procedural issue: whether the citizen suit provision of the CWA13 allows suits to enforce obligations under an ambiguous CWA regulation after the 120-day period for directly challenging the rule under section 509 of the Act had elapsed.14 The defendants argued that section 509 provided the exclusive means for challenging EPA’s rule,15 thus creating a jurisdictional bar to the plaintiffs' claims under the citizen-suit provision. A unanimous Court rejected the defendants’ argument, concluding that "the exclusive jurisdiction mandate is not applicable in this suit."16 The Court held that section 509's jurisdictional grant applies "only to certain suits challenging some agency actions" and thus "does not bar a district court from entertaining a citizen suit" that has two factual predicates:17 First, the citizen suit must be against an alleged violator of the law; second, the citizen suit must "seek to enforce an obligation imposed by the [CWA] or its regulations."18 Accordingly, the Court held that the case fell within the scope of the citizen-suit provision because "[i]t is a claim to enforce what is at least a permissible reading" of the EPA's "ambiguous" Silviculture Rule.19
Having found that the Court had jurisdiction under the citizen suit provision, the Court then addressed the merits of the Silviculture Rule, noting that NPDES permits for the discharges of channeled stormwater runoff were required only if the discharges were "associated with industrial activity."20 If the discharges were not "associated with industry activity," as defined in EPA's Industrial Stormwater rule (ISR), then they fall within the CWA’s general exemption from the NPDES permitting scheme of "discharges composed entirely of stormwater."21 The defendants asserted — and the EPA agreed, participating as an amicus curiae22— that their activities were not included in the industrial storm water rule's definition, and were therefore exempt under the CWA’s general NPDES stormwater exclusion.
The Court thus confronted the question of what level of deference to afford an agency’s interpretation of its own regulation. Justice Kennedy’s majority opinion began by reciting the standard articulated in Auer v. Robbins:23 "[A]n agency’s interpretation need not be the only possible reading of a regulation — or even the best one — to prevail," because the Court generally defers to the agency’s interpretation "unless that interpretation is 'plainly erroneous or inconsistent with the regulation.'"24 The Court then held that the "EPA’s interpretation is a permissible one."25 It reinforced its conclusion to accord Auer deference to the EPA’s interpretation of the ISR by noting that "there is no indication that [EPA’s] current view is a change from prior practice or a post hoc justification adopted in response to litigation."26 Indeed, "[t]he opposite is the case," as the EPA "has been consistent in its view that the types of discharges at issue here do not require NPDES permits."27
The Other Opinions
Justice Scalia dissented from the majority’s analysis of the merits, arguing that the majority "gives effect to a reading of EPA's regulations that is not the most natural one, simply because EPA says that it believes the unnatural reading is right."28 He asserted that the Court has "been giving agencies the authority to say what their rules mean under the harmless-sounding banner of 'deferr[ing] to an agency’s interpretation of its own regulations'" for "no good reason."29 Specifically, Justice Scalia suggested that EPA’s definitional interpretation that the Court approved here is actually contrary to the text of the CWA. Justice Scalia frankly remarked that "I believe it is time" to "reconsider Auer"30 — an opinion he authored.31
However, Justice Scalia did not urge a reconsideration of Chevron deference.32 Instead, he distinguished Auer from Chevron, arguing that deference to an agency’s interpretation of a statute is justified where Congress has expressly delegated interpretive authority to the agency.33 But there is no reason to defer to an agency’s interpretation of its own regulation because "[h]e who writes the law must not adjudge its violation."34
In a brief two-page concurrence, Chief Justice Roberts, joined by Justice Alito, agreed that Justice Scalia’s opinion "raises serious questions about the principles set forth in . . . Auer v. Robbins."35 The Chief Justice agreed that it "may be appropriate to reconsider [Auer deference] in an appropriate case." But, he wrote, "this is not that case."36
The Chief Justice articulated two prudential concerns that weighed against joining Justice Scalia’s opinion in this case. First, he noted that the plaintiff mentioned reconsidering Auer in only one sentence of a single footnote, without any accompanying argument or reasoning. Second, the Chief Justice asserted that this "issue is a basic one going to the heart of administrative law." Accordingly, he explained that he would wait to consider overruling Auer until there was "a case in which the issue is properly raised and argued" before the Court. Looking forward, Chief Justice Roberts plainly stated that the "bar is now aware that there is some interest in reconsidering those cases" and that Justice Scalia’s opinion provides "a concise statement of the arguments on one side of the issue."37
Implications of the Ruling
This decision is significant in three respects:
- The Court’s holding on the citizen-suit provision potentially opens the door to future citizen suits to contest EPA’s interpretation of its own regulations. Putative plaintiffs now have the option of challenging regulations as inconsistent with a statute under the citizen-suit provision, even after the 120-day period for the regulation’s review has elapsed. This creates greater uncertainty for the regulated community.
- The Court upheld and applied the principle that an agency’s reasonable interpretation of its own regulations will be given deference where that interpretation is not a change from prior practice. Specifically, it approved of EPA’s definition of regulated discharges under the CWA.
- Perhaps most significant going forward, Justice Scalia, as well as Chief Justice Roberts and Justice Alito, explicitly acknowledged their willingness to reconsider the principle underlying Auer deference. In doing so, these three justices suggested the potential for a future ruling that would limit, modify or overturn outright the traditional practice of judicial deference to an agency’s interpretation of its own regulations — particularly in cases where the agency’s interpretation may be contrary to the authorizing statute’s text. But given Justice Breyer’s total recusal from this case38 and the fact that Justice Kennedy authored the majority opinion that defended, upheld and applied Auer deference, there are no assurances that there are sufficient votes to depart from Auer in a future case.