In Sackett v. United States Environmental Protection Agency, (9th Cir. 2010) 622 F.3d 1139, the Ninth Circuit held that the Clean Water Act (CWA) precludes judicial review of compliance orders until after an enforcement action is filed, and that preclusion of judicial review of pre-enforcement compliance orders under the CWA’s statutory scheme did not violate due process. The Court first determined the language and structure of CWA demonstrates that Congress intended to preclude pre-enforcement judicial review of administrative compliance orders under 33 U.S.C. § 1319(a)(3). The Court further found that the CWA civil penalty provision does not authorize the EPA to bring enforcement actions for mere violations of compliance orders. In reaching this result, the Court held the EPA must bring an action alleging a violation of the CWA itself in order to enforce a compliance order under the CWA.
The plaintiffs in the case owned a 0.63-acre undeveloped lot near Priest Lake, Idaho. In preparation for building a house, they filled in about one-half acre of their property. Thereafter, the Environmental Protection Agency (EPA) issued a compliance order alleging the subject property is a wetland under the CWA and that the plaintiffs violated the CWA by filling in their property without first obtaining a permit.
The plaintiffs requested a hearing with the EPA to challenge the compliance order’s finding that their property is subject to the CWA. The EPA declined the requested hearing. The plaintiffs then filed this action seeking injunctive and declaratory relief. They argued the compliance order was: (1) arbitrary and capricious under the Administrative Procedure Act (APA); (2) issued without a hearing in violation of procedural due process rights; and (3) issued on the basis of a standard (“any information available”) that is unconstitutionally vague. The district court granted EPA’s motion to dismiss the claims for lack of subject-matter jurisdiction.
The Ninth Circuit affirmed. Before turning to the merits of the action, the court described EPA’s three main civil enforcement options under the CWA. First, the EPA can assess an administrative penalty, which entitles the alleged violator to a hearing and judicial review. (33 U.S.C. § 1319(g).) Second, the EPA can initiate a civil enforcement action. (33 U.S.C. § 1319(b).) Third, the EPA can issue an administrative “compliance order.” (33 U.S.C. § 1319(a).) The court noted the CWA does not expressly provide for pre-enforcement judicial review of compliance orders. Therefore, the court determined that under Supreme Court precedent it must look other factors to determine whether the statute precludes judicial review of such orders.
First, the court reviewed structure of the statutory scheme and the nature of the administrative action, noting that Congress gave the EPA a choice of issuing a compliance order or bringing a civil action in district court. (33 U.S.C. § 1319(a)(3).) The court then determined that authorizing pre-enforcement judicial review of compliance orders would eliminate EPA’s choice under this section by enabling those subject to a compliance order to force the EPA to litigate all compliance orders in court.
Second, the court looked at the objectives of compliance orders under the CWA. The court noted that other courts have concluded that compliance orders are meant to “allow EPA to act to address environmental problems quickly and without becoming immediately entangled in litigation.” The court determined this goal would be defeated by permitting immediate judicial review of compliance orders.
Third, the court considered the legislative history of the CWA and found the legislative history of the CWA supported a determination that Congress did not intend for pre-enforcement judicial review of compliance orders. Based on the foregoing, the court held that a congressional intent to preclude pre-enforcement judicial review of compliance orders is “fairly discernible in the statutory scheme.” The court noted that every other circuit court reviewing this issue had reached a similar result.
The court then addressed the plaintiffs’ argument that precluding pre-enforcement review of CWA compliance orders violated their due process rights. The court began by noting that if the CWA is read in the literal manner as suggested by the plaintiffs, it might create a due process problem. However, the court held that the term “any order” in § 1319(d) refers only to orders predicated on actual violations of the CWA as identified by a district court in an enforcement proceeding according to traditional rules of evidence and standards of proof.
Finally, the plaintiffs argued that forcing them to wait until the EPA brings an enforcement action ignores the realities of their circumstances because of the “frightening penalties” they risk accruing by refusing to comply. The court was not persuaded that the potential consequences from violating CWA compliance orders are so onerous so as to “foreclose all access to the courts” and create a “constitutionally intolerable choice.” The court listed two reasons supporting this conclusion. First, the CWA channels judicial review through the affirmative permitting process, which allowed for judicial review. Second, the civil penalties provision is committed to judicial, not agency, discretion and is based on six factors: (1) the seriousness of the violation, (2) the economic benefit resulting from the violation, (3) any history of CWA violations, (4) good-faith efforts to comply, (5) the economic impact of the penalty on the violator, and (6) such other matters as justice may require. Based on the foregoing considerations, the court held the amount of any penalty would reflect a discretionary, judicially determined penalty, taking into account a wide range of case-specific equitable factors and imposed only after the plaintiffs had a full and fair opportunity to present their case in a judicial forum.
Therefore, the court determined that the district court properly dismissed this case for lack of subject-matter jurisdiction.