On April 28, 2014, Jane Montgomery and David Loring presented the three cases at a U.S. Supreme Court energy and environmental case update hosted by the Energy Council, Illinois Chamber of Commerce.  What follows is a written transcript of Mingo Logan Coal Co. v. EPA. The other two cases are available at Rocky Mountain Farmers v. Corey, 730 F.3d 1070 (9th Cir. 2013) and In re: La Paloma Energy Center, LLC, 2014 WL 1066556 (EPA Env. Appeals Bd., Mar. 14, 2014)

The first case that we are going to talk about today is both relevant and concerning no matter the federal environmental statute at issue because it involves the expansion of EPA’s authority to essentially invalidate an issued permit and activities that were lawfully performed under that permit.

Mingo Logan essentially involved EPA’s retroactive invalidation of a CWA discharge permit.  This permit had allowed Mingo to discharge dredge/fill waste material from its mountain-top mining activities.  Dredge and fill permits (issued under Section 404 of the CWA) are actually issued by the Army Corps of Engineers, not EPA.  However, a particular section of the CWA (section 404(c)) actually grants EPA veto authority over the site selected to receive the discharge.  Before this case it was generally understand that EPA could only veto a site selection during the permit application process, not after the permit was issued.  The court noted in fact that EPA had not vetoed a site selection in an issued Section 404 permit in over 30-years.

The facts, in brief, were as follows: Mingo applied for a permit in 1999; the permit was issued in 2007 after EPA had an opportunity to and chose not to object to its issuance; some 4 years later, after providing notice to the Corps and Mingo, EPA issued a determination withdrawing its prior approval of the discharge sites that Mingo had been using since 2007.

Like so many environmental cases, this case revolved around the meaning of a single word under the CWA – “whenever.”  Section 404(c) authorizes EPA to withdraw any approved discharge site “whenever” it determines that the discharge will have an unacceptable impact on the environment.  EPA took this to mean – and the DC Circuit agreed – that EPA could withdraw an approved discharge site anytime new information became available to it, regardless of whether a permit had been issued; regardless of whether a source was operating in reliance on that permit.  DC Circuit simply held that section 404(c) was “unambiguous” in its grant of “broad veto power extending beyond the permit issuance” to EPA.

The lower district court for the D.C. Circuit had actually refused to award EPA such broad authority.  In perhaps my favorite quote, the lower court reasoned that doing so would “posit[] a scenario involving the automatic self-destruction of a written permit … after years of study and consideration.  Poof!”

Unfortunately, the Supreme Court denied review of the decision just last month.  The decision obviously raises a number of concerns, not the least of which is the obvious question of what if any certainty does a permittee have to rely on an issued water discharge permit if EPA can invalidate it at any time?  There is nothing in the decision to suggest that the ruling is specific to the mining industry.  And other than EPA’s assertion that new information 4 years after the permit was issued “came to light” that warranted invalidating the permit, there is no standard that EPA has to meet to invalidate a water discharge permit.  We view it as having potentially wide reaching implications for any construction activity including pipelines or any other type of activity needing a dredge and fill permit. We expect future litigation based on this expansion of EPA’s authority.