On Thursday, June 13, 2013, the Supreme Court issued a unanimous opinion, authored by Justice Sotomayor, in Tarrant Regional Water District v. Hermann, ruling that the Red River Compact did not permit a Texas water district to acquire water from within Oklahoma's sovereign territory. The waters of the Red River, which flow through Texas, Oklahoma, Arkansas, and Louisiana, are governed by the Red River Compact ("Compact"), signed by the States and approved by Congress, to equitably apportion the Red River. At issue in this case was the efforts of the Tarrant Regional Water District ("Tarrant"), which provides water to areas of northeastern Texas, to obtain a water permit from the Oklahoma Water Resources Board to transport water from Oklahoma for use in Texas. Oklahoma law, however, does not permit the issuance of water permits for the transport and use of water out of state. To challenge the Oklahoma law, Tarrant filed suit arguing that the Compact permits cross-border use of water and preempts the Oklahoma law, and that the Oklahoma law violates the Commerce Clause of the United States Constitution.

The Supreme Court rejected both of Tarrant's arguments. As Congress' approval of the Compact gave it the status of a federal law, the Court applied principles of federal contract law to determine whether the Compact permitted a Texas entity to acquire water in Oklahoma. Reviewing the express terms of the Compact, principles of state sovereignty, customary practices in other interstate water compacts, and the parties conduct, the Court held "[t]he Compact creates no cross-border rights in Texas." The Compact requires the States to ensure sufficient water was delivered to the downstream State, but it does not permit one State to enter into the territory of another for purposes of obtaining water. The Court also concluded Oklahoma's water law does not violate the Commerce Clause, because all water in the Red River was allocated by the Compact to the states, and therefore there was no "unallocated" water Tarrant, as a Texas entity, could seek in Oklahoma. The Court's opinion is available here.