Amicus Curiae Brief — U.S. Army Corp of Eng'rs v. Hawkes Co., 136 S. Ct. 615 (2015) (No. 15-290)

No. 15-290

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OFFICE OF THe cL!

IN THE

Supreme Court of the Unite

UNITED STATES ARMY CORPS OF ENGINEERS,

Petitioner,

v.

HAWKES CO., INC., e¢ al.,

Respondents.

ee ee ee ew — ——— -

On Writ or CERTIORARI TO THE UNITED STATES

Court or APPEALS FOR THE Eicutsx Circurr

BRIEF OF THE CHAMBER OF COMMERCE

OF THE UNITED STATES OF AMERICA

AS AMICUS CURIAE IN SUPPORT

OF RESPONDENTS

Kate CoMERFORD Topp MicHak H. Park

SreveN P. LEHOTSKY Counsel of Record

WARREN PosTMAN Consovoy McCartuy Park PLLC

U.S. CHAMBER Three Columbus Circle, 15th Floor

LITIGATION CENTER New York, New York 10019

1615 H Street, NW (212) 247-8006

Washington, DC 20062 park@consovoymccarthy.com

(202) 463-5337

Wi.uiaM 8S. Consovoy

J. MicnAkEt ConNOLLY

Consovoy McCartuy Park PLLC

3033 Wilson Boulevard, Suite 700

Arlington, Virginia 22201

(703) 243-9423

Counsel for Amicus Curiae

March 2, 2016

264279

i

TABLE OF CONTENTS

TABLE OF CONTENTS.

TABLE OF CITED AUTHORITIES

INTEREST OF AMICUS CURIAE

SUMMARY OF ARGUMENT

ARGUMENT.

I. Jurisdictional Determinations Are

Final Agency Actions Subject to

Judicial Review. .

Il. The Corps’ Reading of “Final Agency

Action” Would Insulate Its Decisions

from Judicial Review

A. Landowners Might Decline to Request

Jurisdictional Determinations if the

Agency’s Decisions Are Not Subject

to Judicial Review.

B. Enduring the Long, Expensive, and

Often Futile Permitting Process

Is Not a Viable Option.

C. Going Forward with a Project and

Inviting Severe Civil and Criminal

Penalties Is Not a Viable Option.

.10

15

.24

i

Table of Contents

Page

D. Abandoning Beneficial Activities

and Foregoing Judicial Review Are

Not Viable Options. .26

CONCLUSION .28

it

TABLE OF CITED AUTHORITIES

CASES

Abbott Labs. v. Gardner,

387 U.S. 136 (1967).

Alaska Dep't of Envtl. Conservation v. EPA,

540 U.S. 461 (2004).

Belle Co. v. U.S. Army Corps of Eng’rs,

761 F.3d 383 (5th Cir. 2014).

Bennett v. Spear,

520 U.S. 154 (1997).

Deerfield Plantation Phase II-B Prop. Owners

Ass’n v. U.S. Army Corps of Eng’rs,

801 F. Supp. 2d 446 (D.S.C. 2011).

Fairbanks N. Star Borough v.

U.S. Army Corps of Eng’rs,

543 F.3d 586 (9th Cir. 2008)

Frozen Food Express v. United States,

351 U.S. 40 (1956).

In re: EPA,

803 F.3d 804 (6th Cir. 2015)

National Wildlife Fed’n v. Hanson,

859 F.2d 313 (4th Cir. 1988).

passim

.6, 8-9

13

Ww

Cited Authorities

Page

Port of Boston Marine Terminal Ass’n v.

Rederiaktiebolaget Transatlantic,

400 U.S. 62 (1970). 5

Rapanos v. United States,

547 U.S. 715 (2006). passim

Res. Invs., Inc. v. U.S. Army Corps of Eng’rs,

151 F.3d 1162 (9th Cir. 1998). » an

Res. Invs., Inc. v. United States,

85 Fed. Cl. 447 (Fed. Cl. 2009) 3, 21, 22, 23

Res. Invs., Inc. v. United States,

114 Fed. Cl. 639 (Fed. Cl. 2014) 23

Res. Invs., Inc. v. United States,

No. 15-802 (S. Ct.) .23

Sackett v. EPA,

132 S. Ct. 1367 (2012). 24

Solid Waste Agency of N. Cook County v.

Army Corps of Eng’rs,

531 U.S. 159 (2001). 12

The Daniel Ball,

10 Wall. 557 (1870) .10

United States v. Appalachian Elec. Power Co.,

311 U.S. 377 (1940) 10

Cited Authorities

United States v. Moses,

496 F.3d 984 (9th Cir. 2007)

United States v. Riverside Bay-iew Homes, Inc.,

474 U.S. 121 (1985).

STATUTES AND OTHER AUTHORITIES

5 U.S.C. § 704.

33 U.S.C. § 1311(a)

33 U.S.C. § 1319(©)(1).

33 U.S.C. § 1342.

33 U.S.C. § 1344.

33 U.S.C. § 1344(b)(1)

33 U.S.C. § 1362(7)

33 U.S.C. § 1362(12).

33 C.F.R. § 209.120(d)(1) -

33 C.F.R. § 209.260(e)(1) .

33 C.F.R. § 320.2(f)

.5, 10

passim

.18, 19, 21

.10

.10

.10, 11

.11, 13

18

vi

Cited Authorities

Page

33 C.F.R. § 320.4(r) 17

33 C.F.R. § 323.2(f) .26

33 C.F-.R. § 325.1 17

33 C.F.R. § 325.1(b) 17

33 C.F.R. § 325.1(d)() 17

33 C.F.R. § 325.1(d)(4) 17

33 C.F.R. § 325.2(a) .18, 20

33 C.F.R. § 325.2(a)(2). 17

33 C.F.R. § 325.2(d) . .18

33 C.F.R. § 331.2 5

33 C.F.R. § 331.6 .20

33 C.F.R. § 331.9 5

33 C.F.R. § 331.12 .20

33 C.F.R. § 332.1 17

40 C.F.R. § 320.4(a) 19

vit

Cited Authorities

Page

40 C.F-R. § 230. .18

40 C.F.R. § 230.3(0)(1)(vi) 13

40 C.F.R. § 230.3(0)(1)(viii) 13

40 C.F.R. § 230.3(0)(3)(iii) 13

40 C.F.R. § 230.10) .18, 19

40 Fed. Reg. 31,324-25 (July 25, 1975) 11

51 Fed. Reg. 41,206 (Nov. 13, 1986). 5, 11

74 Fed. Reg. 626, 627 (Jan. 7, 2009). .24

80 Fed. Reg. 37,053-37,127 (June 29, 2015) 12

D. Sunding, Review of 2014 EPA Economic Analysis

of Proposed Revised Definition of Waters

of the United States (May 15, 2014) .16

Economic Analysis of Proposed Revised

Definition of Waters of the United States,

U.S. Environmental Protection Agency and

U.S. Army Corps of Engineers (Mar. 2014) .24

vitt

Cited Authorities

Page

Kenneth S. Gould, Drowning in Wetlands

Jurisdictional Determination Process:

Implementation of Rapanos v. United States,

30 U. Ark. Little Rock L. Rev. 413 (2008). 16

Kim D. Connolly, et al., Wetlands Law and

Policy: Understanding Section 404 (2005). 17

Royal C. Gardner, Lawyers, Swamps, and

Money: U.S. Wetland Law, Policy, and

Politics (2011) 14, 15

Stephen M. Johnson, /ndividual Permits

(2005) 17, 19, 20

Sunding & Zilberman, The Economics of

Environmental Regulation by Licensing:

An Assessment of Recent Changes

to the Wetland Permitting Process,

42 Natural Resources J. 59 (2002) 16

Testimony of Janet Kovinoky, U.S. Chamber

of Commerce, before the U.S. Senate

Committee on Banking, Housing, and

Urban Affairs (Apr. 23, 2015). .27, 28

Transportation Performance Index: Key Findings,

U.S. Chamber of Commerce (2010) .27, 28

U.S. Army Corps of Eng’rs: Regulatory Guidance

Letter No. 05-02 (June 14, 2005) 6

ww

Cited Authorities

U.S. Army Corps of Engineers Jurisdictional

Determination Form Instructional

Guidebook (2007) .

U.S. Department of Transportation, 2010 Status

of the Nation’s Highways, Bridges, and

Transit: Conditions and Performance (2010)

U.S. Envt’l Prot. Agency & U.S. Army Corps

of Eng’rs, Clean Water Act Jurisdiction

Following the U.S. Supreme Court’s

Decision in Rapanos v. United States

& Carabell v. United States (Dec. 2, 2008) .

White House Press Release, Fact Sheet—Building

a 2lst Century Infrastructure: Modernizing

Infrastructure Permitting (May 14, 2014)

13-14

27

12

. 27-28

]

INTEREST OF AMICUS CURIAE'

The Chamber of Commerce of the United States of

America (“Chamber”) is the world’s largest business

federation. The Chamber represents 300,000 direct

members and indirectly represents the interests of

more than three million companies and professional

organizations of every size, in every industry, from every

region of the country. More than 96% of the Chamber’s

members are small businesses with 100 or fewer

employees. An important function of the Chamber is to

represent the interests of its members in matters before

Congress, the Executive Branch, and the courts. To that

end, the Chamber regularly files amicus cwriae briefs in

cases that raise issues of concern to the Nation’s business

community.

Many industries in which the Chamber’s members

operate regularly confront issues concerning the

scope of the Clean Water Act and would be adversely

affected if they were unable to challenge a jurisdictional

determination by the Army Corp of Engineers. These

industries include manufacturing, mining, asphalt

production, food production, pulp and paper production,

paint manufacturing, electricity production, energy

development, water utilities, sand, stone, and gravel

operations, road construction and maintenance, landfills,

real estate development, railroads, industrial development,

and agriculture.

1. The parties have consented to the filing of this brief. No

counsel for any party authored this brief in whole or in part, and

no person or entity other than amicus, its members, or its counsel

made a monetary contribution intended to fund the preparation or

submission of this brief.

2

Without the timely ability to seek judicial review

under the Administrative Procedure Act, the Chamber’s

members will be blocked from conducting routine activities

on their property until they endure an expensive, vague,

and time-consuming regulatory process. These burdens

will cause substantial harm to the Chamber’s members;

indeed, in many instances, the cost of compliance or the

risk of exorbitant penalties will force them to abandon

valuable projects and activities altogether.

SUMMARY OF ARGUMENT

Approved jurisdictional determinations are final

agency actions subject to judicial review because they

have substantial real-world consequences on the legal

rights and obligations of landowners. The Army Corps

of Engineers (“Corps”) seeks to minimize the impact of

its jurisdictional determinations, but without the ability

to seek immediate judicial review of an unfavorable

jurisdictional determination, a landowner is left with three

untenable options. First, the landowner can apply for a

permit, submit to the attendant costs and delays, and seek

judicial review of the jurisdictional determination when

the permit process is complete, often years later. Second,

the landowner can proceed without a permit and risk

exposure to an enforcement action carrying significant

penalties. Or third, the landowner can walk away from the

endeavor altogether and thus forfeit the right to challenge

the agency determination in court. As the Eighth Circuit

correctly recognized, landowners should not be confined

to these three options.

Landowners who decide to apply for permits and

defer (or forego) any judicial review must be prepared

3

for long delays and high costs. As a plurality of the Court

recognized in Rapanos v. United States, 547 U.S. 715

(2006), the average applicant for an individual Corps permit

spends 788 days and $217,596 to complete the process. /d.

at 721. There are myriad examples of businesses suffering

such delays and expenses. For example, the Court of

Federal Claims recently documented how one business

spent seven years and millions of dollars seeking a Section

404 permit—only for a federal court to rule later that the

Corps lacked jurisdiction all along. See Res. Invs., Inc. v.

United States, 85 Fed. Cl. 447 (2009). Allowing prompt

judicial review of jurisdictional determinations under the

Administrative Procedure Act (“APA”) would avoid this

type of senseless delay and expense.

Some landowners might decline to seek a permit

under the Clean Water Act (“CWA”), as the prospect of

a long, expensive, and likely futile permitting process is

simply not a viable option. But for many, it is not feasible

to move forward with development plans and to risk severe

civil and criminal penalties. Thus, the likely outcome

if the Corps’ position prevails and its jurisdictional

determinations are insulated from judicial review is that

landowners will simply abandon beneficial activities,

resulting in unrealized economic potential and diminished

faith in government.

The Corps’ position not only misconstrues the timing

and scope of judicial review under the APA, but if adopted

by this Court, it also would inflict serious harms on

American business, including increased permitting costs,

depreciation in property values, and substantial delays

of business activities. In light of the severe pragmatic

consequences, this Court should hold that a jurisdictional

4

determination is a final agency action subject to immediate

judicial review under the APA.

ARGUMENT

I. Jurisdictional Determinations Are Final Agency

Actions Subject to Judicial Review.

The APA permits judicial review of a “final agency

action for which there is no other adequate remedy in a

court.” 5 U.S.C. § 704. Two conditions must be satisfied

for agency action to be considered “final”: “First, the

action must mark the ‘consummation’ of the agency’s

decisionmaking process—it must not be of a merely

tentative or interlocutory nature. And second, the action

must be one by which ‘rights or obligations have been

determined,’ or from which ‘legal consequences will flow.”

Bennett v. Spear, 520 U.S. 154, 177-78 (1997) (citations

omitted). Jurisdictional determinations satisfy both

prongs of this test for final agency action. See Brief of

Respondent (“Resp. Br.”) at 18-39.

As to the first prong, there is no question that a

jurisdictional determination is the “consummation of

the agency’s decisionmaking process” and is not “merely

tentative or interlocutory [in] nature.” Jd. When an

agency has “asserted its final position on the factual

circumstances underpinning” its action, that is a decisive

indication that it has consummated the decisionmaking

process. Alaska Dep't of Envtl. Conservation v. EPA, 540

U.S. 461, 483 (2004). Similarly, once an agency decision

has completed the administrative appeal process—and

therefore is not subject to further agency review—‘“the

process of administrative decisionmaking has reached a

5

stage where judicial review will not disrupt the orderly

process of adjudication.” Port of Boston Marine Terminal

Ass'n v. Rederiaktiebolaget Transatlantic, 400 U.S. 62,

70-71 (1970).

By its terms, a jurisdictional determination is “a

written Corps determination that a wetland and/or

waterbody is subject to regulatory jurisdiction” under

the CWA. 33 C.F.R. § 331.2. Once a determination has

wound its way through the administrative appeal process,

it is final and not subject to further review by the agency.

See id. § 331.9. That is precisely why Corps regulations

provide that “the public can rely on that determination

as a Corps final agency action.” 51 Fed. Reg. 41,206.

In short, through the jurisdictional determination, the

Corps asserts its final position on the facts underlying

jurisdiction—that is, the presence or absence of “waters

of the United States” within the meaning of the CWA.

The jurisdictional determination at issue here

demonstrates the finality of the agency action. The

determination Respondent received was the product

of several rounds of administrative review in response

to an application for a Section 404 permit.? The Corps

issued a “preliminary” determination in March 2011, a

“draft” determination in November 2011, and, finally,

an “approved” jurisdictional determination in February

2012. Petition Appendix (“Pet. App.”) 6a-7a. Following

2. The CWA provides certain exceptions to its prohibition of

“the discharge of any pollutant by any person.” 33 U.S.C. § 131 1(a).

Section 402 of the CWA authorizes the EPA to “issue a permit for

the discharge of any pollutant,” and Section 404 authorizes the Corps

to “issue permits ... for the discharge of dredged or fill material into

the navigable waters at specified disposal sites.” Jd. §§ 1342, 1344.

6

an administrative appeal, the “approved” determination

was reissued as a “revised” jurisdictional determination

in December 2012. Jd. at 7a. The “revised” determination

provided that it was a “final Corps permit decision in

accordance with 33 C.F.R. § 331.10.” Jd. at 7a-8a. In other

words, the jurisdictional determination was a “definitive,

official determination.” U.S. Army Corps of Eng’rs:

Regulatory Guidance Letter No. 05-02 (June 14, 2005).

Accordingly, every court of appeals to address this

issue has held that these jurisdictional determinations

satisfy the first prong of the Bennett test. See Belle Co. v.

U.S. Army Corps of Eng’rs, 761 F.3d 383, 389-90 (5th Cir.

2014); Fairbanks N. Star Borough v. U.S. Army Corps of

Eng’rs, 543 F.3d 586, 591 (9th Cir. 2008). Indeed, despite

repeatedly arguing to the contrary, see, e.g., Pet. App.

9a, even the Corps now concedes that a jurisdictional

determination satisfies this requirement, see Brief of

Petitioner (“Pet. Br.”) 25-26.

The jurisdictional determination likewise satisfies the

Bennett test’s second prong. It establishes “rights and

obligations” and has “legal consequences.” Bennett, 520

U.S. at 177-78. The Corps contends that a jurisdictional

determination does not expand or contract the landowner’s

rights or options; according to the Corps, the determination

merely “provides additional information that the

landowner may find useful in choosing between those

alternative courses of conduct.” Pet. Br. 16.

But this is simply not true. As the Eighth Circuit

understood, significant obligations and consequences

follow from a jurisdictional determination. In particular,

a determination requires landowners “either to incur

7

substantial compliance costs (the permitting process),

forego what they assert is lawful use of their property,

or risk substantial enforcement penalties.” Pet. App.

lla. Seeking a permit is expensive, time-consuming, and

often futile (as it was here). See infra 15-24. Ignoring

the determination and proceeding with the activity risks

the imposition of massive civil and criminal penalties

through a government enforcement action. See infra 24-25.

And walking away from the project nullifies potentially

beneficial opportunities for that property and deprives the

landowner of his day in court. See infra 26-28. Limiting

landowners to such untenable options, in other words,

has “direct and appreciable legal consequences” and thus

satisfies the second Bennett factor. Pet. App. 14a.

Moreover, the Corps’ understatement betrays a

fundamental failure to appreciate the practical realities

facing landowners who must grapple with the real-

world implications of complex and burdensome federal

environmental regulation. It often is extremely “difficult

and confusing ... for a landowner to predict whether

or not his or her land falls within CWA jurisdiction.”

Pet. App. 20a. Individuals and businesses seeking to

undertake construction projects where wetlands are in

the general vicinity must examine numerous factors to

make this determination. This exercise often requires the

involvement of lawyers, expert consultants and certified

wetland delineators.

To say that a landowner with an unfavorable

jurisdictional determination is free to treat it as carrying

no more weight than a “private consultant’s report,” Pet.

Br. 32, is simply not true. This Court’s precedent does

not require such a constrained reading of agency action.

8

See, e.g., Abbott Labs. v. Gardner, 387 U.S. 136, 148-50

(1967) (finding that drug labeling regulations constitu’ +d

a final agency action because they put drug companies

in the dilemma of incurring massive compliance costs

or risking criminal and civil penalties for distributing

“misbranded” drugs); Frozen Food Express v. United

States, 351 U.S. 40, 43-44 (1956) (finding an Interstate

Commerce Commission order reviewable because “the

determination by the Commission that a commodity is

not an exempt agricultural product has an immediate and

practical impact,” as it “warns every carrier, who does

not have authority from the Commission to transport

those commodities, that it does so at the risk of incurring

criminal penalties”).

Importantly, the Corps’ unreasonably narrow

conception of the second Bennett factor might harm more

than just landowners. It could prevent environmental

groups or neighboring property owners, for example,

from challenging negative jurisdictional determinations

(i.e., that there are no “waters of the United States” on

property). Compare Pet. Br. 40 (“Just as an affirmative

jurisdictional determination does not impose any

independent legal barrier to pollutant discharges, a

negative jurisdictional determination does not have the

legal effect of a permit issued by the Corps pursuant to

33 U.S.C. 1344.”), with Deerfield Plantation Phase II-B

Prop. Owners Ass'n v. U.S. Army Corps of Eng’rs, 801

F. Supp. 2d 446, 459 (D.S.C. 2011) (finding that “legal

consequences do flow from the Corps’ 2010 JD (‘negative’

determination), as any developer of the property could

conceivably immediately begin to fill and dredge the

eighty-plus acres that the Corps determined to be non-

jurisdictional”). See also Fairbanks N. Star Borough, 543

9

F.3d at 597; National Wildlife Fed’n v. Hanson, 859 F.2d

313, 316 (4th Cir. 1988).

In the end, the second Bennett factor must account

for the attributes of the regulatory regime to which it is

being applied. Whatever may be true in other settings,

there can be no doubt that a jurisdictional determination

by the Corps creates the kind of rights and obligations

that are sufficient to warrant immediate judicial review.

Forcing landowners to choose from a menu consisting

of administrative purgatory, surrender of rights, or

civil disobedience is inappropriate and unwarranted. A

jurisdictional determination therefore is final agency

action under the APA.

II. The Corps’ Reading of “Final Agency Action”

Would Insulate Its Decisions from Judicial Review.

The Corps forecasts dire consequences if its

jurisdictional determinations are subject to immediate

judicial review, including the possibility that the agency

may cease making such determinations altogether. See

Pet. Br. 24. But the Corps has it backwards. It is the

individuals, businesses, landowners, and anyone else

seeking legal certainty about the status of their property

who will suffer if jurisdictional determinations are

unreviewable.

Landowners interested in pursuing development

projects are limited to four options: (1) decline to seek

a jurisdictional determination in the hope that their

land does not contain “waters of the United States”; (2)

request a jurisdictional determination and, if unfavorable,

apply for a permit under Section 404 and challenge the

10

determination in court if the permit is denied; (8) proceed

with the plans and decline to seek a permit under Section

404 in the hope that the lands do not contain “waters of the

United States,” thus risking civil and criminal penalties,

which could be challenged later; or (4) abandon the plans

entirely. None of these options is tenable.

A. Landowners Might Decline to Request

Jurisdictional Determinations if the Agency’s

Decisions Are Not Subject to Judicial Review.

Jurisdictional determinations are necessary because

under the Corps’ current approach to the CWA,

landowners often have no idea whether their lands are

subject to the law’s requirements. See Pet. Br. 5, 23-24.

The CWA prohibits “the discharge of any pollutant” into

“navigable waters” without a federal permit. 33 U.S.C.

§§ 1311(a), 13862(12); id. § 1362(7) (defining “navigable

waters” to mean “the waters of the United States,

including the territorial seas”).

For most of American history, the meaning of

“navigable waters” has been reasonably straightforward.

Before the CWA, the Supreme Court had long interpreted

the phrase “navigable waters of the United States” to refer

to interstate waters that are “navigable in fact” or readil,

susceptible of being rendered so. See The Daniel Ball, 10

Wall. 557, 563 (1870); United States v. Appalachian Elec.

Power Co., 311 U.S. 377, 406 (1940).

The Corps retained this understanding when, shortly

after passage of the CWA in 1972, it promulgated rules

adopting the traditional judicial definition of “navigable

waters.” See 33 C.F.R. § 209.120(d)(1) (1974) (defining

11

“navigable waters” to mean “those waters of the United

States which are subject to the ebb and flow of the tide,

and/or are presently, or have been in the past, or may be

in the future susceptible for use for purposes of interstate

or foreign commerce”). In doing so, the Corps emphasized

that “[i}t is the water body’s capability of use by the public

for purposes of transportation or commerce which is the

determinative factor.” Jd. § 209.260(e)(1). As a result, in

the years immediately following the passage of the CWA,

it was rarely disputed whether land contained “navigable

waters.”

But this certainty soon eroded. In 1975, the Corps

adopted new regulations that extended the definition

of “waters of the United States” to the outer limits of

Congress’s commerce power. Specifically, the Corps

expanded “waters of the United States” to include

navigable waters and their tributaries, as well as non-

navigable intrastate waters that could affect intrastate

commerce. 40 Fed. Reg. 31,324-25 (July 25, 1975); see

United States v. Riverside Bayview Homes, Inc., 474 U.S.

121 (1985) (upholding the Corps’ classification of a Michigan

wetland “characterized by saturated soil conditions and

wetland vegetation [that] extended beyond the boundary

of [the] property to ... a navigable waterway” because the

property was “part of a wetland that actually abuts on a

navigable waterway”). In 1986, the Corps expanded the

definition of “waters of the United States” even further,

asserting jurisdiction over traditional navigable waters,

tributaries of those waters, wetlands adjacent to those

waters and tributaries, and waters used as habitats by

migratory birds that either are protected by treaties or

cross state lines. 51 Fed. Reg. 41,206 (Nov. 13, 1986).

12

This Court twice rejected the Corps’ assertion of

power as too broad. In Solid Waste Agency of N. Cook

County v. Army Corps of Eng’rs, the Court concluded that

the CWA did not give the Corps jurisdiction to regulate an

abandoned sand and gravel pit that provided a habitat for

migratory birds. 531 U.S. 159 (2001). And in Rapanos v.

United States, the Court found that the CWA did not give

the Corps jurisdiction over four Michigan wetlands that

were “near ditches or man-made drains that eventually

empt[ied] into traditional navigable waters.” 547 U.S. 715,

729 (2006).

In the wake of Rapanos, the Environmental Protection

Agency (“EPA”) and the Corps issued new informal

guidance as to how it would analyze “waters of the United

States.” See U.S. Envt’l Prot. Agency & U.S. Army Corps

of Eng’rs, Clean Water Act Jurisdiction Following the

U.S. Supreme Court’s Decision in Rapanos v. United

States & Carabell v. United States (Dec. 2, 2008). The 2008

guidance, among other things, explained the approach

the Corps would use to determine whether waters were

subject to the CWA. The Corps recognized that further

consideration of jurisdictional issues could be appropriate

in the future, either through issuance of additional

guidance or through rulemaking.

In June 2015, the EPA and the Corps released a

final rule expanding the reach of “waters of the United

States” under the CWA. Clean Water Rule: Definition of

“Waters of the United States,” 80 Fed. Reg. 37,053-37,127

(June 29, 2015) (““WOTUS Rule”). This rule broadens the

definition of “waters of the United States” by, among other

things, (1) adding a new category of waters “adjacent” to

primary waters, including “neighboring” waters within

13

certain distances, 40 C.F.R. § 230.3(0)(1)(vi); (2) adding a

new category of waters located within certain distances

of primary waters, if the new category of waters has a

“significant nexus” to a primary water, id. § 230.3(0)(1)

(viii); and (8) redefining “tributaries” in a way that vastly

expands federal jurisdiction over streams that are dry for

most of the year, id. § 230.3(0)(3)(iii). In October 2015, the

Sixth Circuit stayed this rule, see In re: EPA, 803 F.3d 804

(6th Cir. 2015), which is the subject of numerous federal

lawsuits throughout the country.

Whether the Corps’ 2008 guidelines control—as was

the case for Respondent—or the new rules survive judicial

challenge, there is no doubt that many landowners will

remain uncertain about their obligations under the CWA.

No longer may a landowner simply examine whether a

water is “capab[le] of use by the public for purposes of

transportation or commerce.” 33 C.F.R. § 209.260(e)(1)

(1974). Instead, jurisdictional determinations will require

complex, fact-bound analysis and will often have no easy

answer.

Jurisdictional determinations thus provide individuals

and businesses with clarity regarding their regulatory

obligations. See Pet. Br. 23-24. But if they are insulated

from timely judicial review, then some landowners

may fairly reconsider whether seeking them is worth

the time and effort. After all, securing a jurisdictional

determination is not easy. They “require documentation

that identifies if there is the presence and/or absence

of jurisdiction,” such as “[mJaps, aerial photography,

soil surveys, watershed studies, scientific literature,

previous [jurisdictional determinations] for the review

area, and local development plans.” U.S. Army Corps

14

of Engineers Jurisdictional Determination Form

Instructional Guidebook 47 (2007). And “jurisdictional

determinations for more complex sites may require

additional documentation,” such as “documentation that

evaluates if there is a significant nexus between the

tributary/wetland system in question and the [traditional

navigable waters].” /d.

Faced with such a process—and with dim prospects for

meaningful judicial review if the outcome is unfavorable—

some landowners might conclude that it is better to roll

the dice, hope that the land at issue has no “waters of the

United States,” and then seek a permit or abandon the

activity if the Corps later disagrees. Indeed, a review

of the Corps’ permitting process “suggest{s] that there

is much truth in the old saying that it is better to ask for

forgiveness (after the fact) than to seek permission (before

the discharge).” Royal C. Gardner, Lawyers, Swamps, and

Money: U.S. Wetland Law, Policy, and Politics 165 (2011).

But this path also has significant risks. Moving

forward without certainty may invite a cease-and-desist

order from the Corps. As a former wetland attorney for

the Department of the Army has explained, the recipient

of a Corps cease-and-desist order faces a difficult choice:

[You can] stop your activities and apply for the

[Section 404] permit, or continue with your

activities and take your chances that you will

prevail when the Corps or the EPA takes you to

court. Neither option is attractive. Suspending

development operations can be very expensive,

especially if equipment and workers are idled

for months, and banks and investors are

15

looking to be repaid. But defending against

an enforcement action will also be quite costly

even if you prevail. Your attorney fees cannot

be shifted to the government. And if you lose,

you are facing thousands of dollars in penalties

and restoration costs.

Id. at 164.

Of course, the better option for all concerned is to

obtain certainty before undertaking these actions. It allows

landowners and the Corps to work, often collaboratively,

to evaluate the land in question and to formalize that

process through a jurisdictional determination. But

landowners might have less incentive to engage in that

process without the availability of immediate judicial

review in those situations where they disagree with the

Corps’ determination.

B. Enduring the Long, Expensive, and Often

Futile Permitting Process Is Not a Viable

Option.

If a landowner receives an unfavorable jurisdictional

determination, the only option for challenging it without

risking civil and criminal penalties is to suspend any

activities and to seek a permit from the Corps. But the

permitting process is long and costly, which may render

it an unrealistic alternative in many situations. Nearly a

decade ago, the average applicant for an individual Corps

permit “spen[t] 788 days and $271,596 in completing the

process.” Rapanos, 547 U.S. at 721; see also Pet. App. 14a

(“[T]Jhe permitting option is prohibitively expensive and

futile.”). Moreover, this does not even account for the costs

16

of mitigation or design changes. The plurality in Rapanos

noted that over $1.7 billion was spent annually to obtain

wetlands permits. See 547 U.S. at 721 (quoting Sunding &

Zilberman, The Economics of Environmental Regulaticn

by Licensing: An Assessment of Recent Changes to the

Wetland Permitting Process, 42 Natural Resources J.

59, 74-76, 81 (2002)). The expense and processing time

have not improved since the Court’s decision in Rapanos

almost a decade ago. See D. Sunding, Review of 2014

EPA Economic Analysis of Proposed Revised Definition

of Waters of the United States at 15-17 (May 15, 2014),

http://goo.gl/PKBaWP. Indeed, Respondent here would

need to spend more than $100,000 to complete the nine

hydrological studies requested by the Corps and endure

several years of delays to complete an Environmental

Impact Statement. Resp. Br. 10-11; see also Kenneth

S. Gould, Drowning in Wetlands Jurisdictional

Determination Process: Implementation of Rapanos v.

United States, 30 U. Ark. Little Rock L. Rev. 413, 444

n.142 (2008).

The Corps downplays the Court’s finding in Rapanos

and attempts to paint a rosy picture of the Section 404

permitting process. See Pet. Br. 46-50. But anyone who has

had to endure this process knows full well the agony that

comes with obtaining this approval. The permitting process

contains numerous steps with countless opportunities for

delay and increased expense. To appreciate more fully

just how onerous it is to obtain a Section 404 permit, it is

helpful to consider the seven steps it generally involves:

(1) Pre-Application Consultation. First, landowners

ordinarily must have a pre-application meeting with

Corps staff. The pre-application meeting is designed to

17

assist potential applicants in determining the extent of

the Corps’ jurisdiction and the applicant’s obligations

under the CWA. 33 C.F.R. § 325.1(b). The applicant must

be prepared to discuss potential modifications to the

project that would avoid any loss of aquatic resources.

Id. §§ 320.4(r), 332.1; see generally Stephen M. Johnson,

Individual Permits 192 (2005), in Kim D. Connolly, et

al., Wetlands Law and Policy: Understanding Section

404 (2005).

(2) Submission of Application. After the pre-application

meeting, the landowner must prepare his permit

application. An application must contain, among other

things: (1) a complete description of the proposed activity,

including necessary drawings, sketches, or plans sufficient

for public notice; (2) the location, purpose, and need for the

proposed activity; (3) a scheduling of the proposed activity;

(4) the location and dimensions of adjacent structures;

and (5) a list of authorization required by other federal,

interstate, state, or local agencies for the work, including

all approvals received or denials already made. 33 C.F.R.

§ 325.1(d)(1). Furthermore, because a Section 404 permit

involves dredged or fill material, the application also must

include: (1) the purpose of any discharge; (2) a description

of the type, composition, and quantity of the material; (3)

the method of transportation and disposal of the material;

and (4) the location of the disposal site. Jd. § 325.1(d)

(4). Myriad additional information may be necessary

depending on the proposed activity. /d. § 325.1.

(3) Completeness Review. Within 15 days of receiving

the application, the Corps must determine that the

application is complete or notify the applicant of any

missing information. See 33 C.F.R. § 325.2(a)(2). The

application process wil! not move forward until the

18

application is deemed “complete.”

(4) Public Notice. Within 15 days of receiving a

“complete” application, the Corps must issue a public

notice and schedule a public comment period. 33 C.F.R.

§ 325.2(d). The comments and responses the Corps receives

will be made part of the application’s administrative

record for consideration during the evaluation process.

Id. § 325.2(a).

(5) Review of Comments and Public Hearing.

After the Corps receives the comments on the permit

application, the agency must inform the applicant about

substantive comments it received and give the applicant

an opportunity to provide additional information. /d.

The Corps may also require the applicant to submit

additional information to address specific issues raised in

the public comments. The applicant must respond to the

Corps’ request for information within 30 days. Jd. When

the Corps reviews the comments, it will also determine

whether it is necessary to hold a public hearing on the

permit application. /d.

(6) Application Evaluation. In evaluating Section 404

permits, the Corps must comply with the Section 404(b)(1)

Guidelines, which are promulgated by the EPA pursuant

to 33 U.S.C. § 1344(b)(1), and incorporated by the Corps

into its own regulations. See 40 C.F.R. pt. 230; 33 C.F.R.

§ 320.2(f). The Section 404(b)(1) Guidelines provide that

the Corps may not permit discharges that “will cause or

contribute to significant degradation of the waters of the

United States.” 40 C.F.R. § 230.10(¢). Under the guidelines,

a discharge contributes to significant degradation if it

has “[sjignificantly adverse effects” on human health

19

or welfare, life stages of aquatic life and other wildlife

dependent on aquatic ecosystems, aquatic ecosystem

diversity, productivity, and stability, or recreational,

aesthetic, and economic values. /d.

In addition to reviewing permits under the 404(b)(1)

Guidelines, the Corps will decide whether to grant or deny

a permit based on a “public interest” review of the benefits

and detriments of the proposed activity. Through the

public interest review, the Corps evaluates the probable

impacts on the public interest of the proposed activity and

its use. The factors that the Corps weighs and balances as

part of this public interest review include “conservation,

economics, aesthetics, general environmental concerns,

wetlands, historic properties, fish and wildlife values,

flood hazards, floodplain values, land use, navigation,

shore erosion and accretion, recreation, water supply and

conservation, water quality, energy needs, safety, food and

fiber production, mineral needs, consideration of property

ownership, and, in general, the needs and welfare of the

people.” Jd. § 320.4(a). The Corps will not grant the permit

if doing so would be contrary to the public interest. /d.

Although the Corps issues permits under Section

404 of the CWA, other federal laws require the Corps

to consult with federal, state, and local agencies, and to

undertake other studies during the permit review. These

laws include, among others, the National Environmental

Policy Act, the Fish and Wildlife Coordination Act, the

Endangered Species Act, the Coastal Zone Management

Act, and the National Historic Preservation Act. Jd. The

Corp must also coordinate its activities with federal, state,

and local agencies. /d.; see generally Johnson, supra, at

197-202.

20

The Corps’ regulations nominally require the agency

to make a decision on a permit within 60 days after the

agency receives a complete permit application. 33 C.F.R.

§ 325.2(a). But the Corps can (and usually does) extend that

deadline. Johnson, supra, at 202. Indeed, the regulations

do not require the Corps automatically to grant a permit

if it does not make a decision within the 60-day period.

As a result, the process often takes substantially longer.

See Rapanos, 547 U.S. at 721.

(7) Appeal Process. If the Corps denies the permit

application, the applicant must exhaust all applicable

administrative remedies before filing legal action in

federal court. 33 C.F.R. § 331.12. Applicants must appeal

within 60 days. Jd. § 331.6. Only after the administrative

appeal process is complete may the applicant seek judicial

review. See id. § 331.12.

In other words, the Section 404 permitting process

is a long, arduous, multifaceted inquiry. The fact that

the Corps seeks to require landowners to undertake all

these steps—before they even can challenge the Corps

statutory authority in the first place—shows just how

much leverage the agency will hold over landowners who

challenge its authority if jurisdictional determinations are

not immediately reviewable.

And although the process is long and complicated on

paper, the Section 404 permitting process is even more

cumbersome in practice. Examples abound of individuals

and businesses enduring the long, expensive permitting

process. Indeed, the Court of Federal Claims recently

documented the travails of one company, Resource

Investments, Inc. (“RII”), that was forced to spend

21

millions of dollars and endure years of delay in the permit

process, despite the fact that the Corps had no jurisdiction

over the land. See Res. Invs., Inc. v. United States, 85 Fed.

Cl. 447 (Feti. Cl. 2009).

RII’s regulatory odyssey was long and tortuous. In

the late-1980s, RII purchased land in order to operate

a landfill in Pierce County, Washington. In September

1989, the Corps asserted jurisdiction over the land and

told RII that it would need to obtain a Section 404 permit

to construct the landfill. After concluding “that it would

be unwise to proceed without a 404 permit,” RII began

the process of preparing its permit application. That

application was not filed until August 1990. Jd. at 460.

Despite regulations requiring the Corps to issue a public

notice within 15 days of the completed application, it did

not issue the notice until March 1992—eighteen months

after the application was filed. The public notice was issued

only because RII “constantly badger[ed] and prodd[ed]

the Corps to [do so].” /d. (citation omitted).

The permit process moved no faster following the

public notice. “Over the next 14 months, the parties went

back and forth over the necessity of revising the project

purpose,” a regulatory requirement that impacts the

scope of the Corps’ practicable alternative analysis under

the Section 404(b)(1) Guidelines. Jd. at 461. Finally, in

February 1994, RII “acceded to the Corps’ demand and

changed [its] project purpose, recognizing that [it] had]

reached a stalemate and not wanting to delay the 404

process any further.” Jd.

A month later, “to [RII’s] dismay, the Corps

determined that it would require a federal [Environmental

22

Impact Statement (‘EIS’)].” Jd. Because “the federal EIS

took longer to draft than the initial schedule allotted,” it

did not issue until December 1995. Jd. During the drafting

of the federal EIS, RII “altered [its] landfill project plan,

specifically attempting to address the Corps’ stated

concerns.” Jd. In particular, the revised plan “reduced

impacted wetlands from 37 acres to 21.6 acres, abandoned

plans to relocate the South Creek, a small stream on the

project site, and modified the original wetlands mitigation

plan.” /d. Despite these changes, the Corps never accepted

RII’s federal EIS. /d.

Finally, in September 1996, the Corps denied RII’s

permit application—a full seven years after the Corps

first asserted jurisdiction. The following month, RII filed

a challenge to the Corps’ decision in federal district court.

Eleven months later, in September 1997, the district court

upheld the Corps’ denial.

In July 1998, almost nine years after the Corps

first asserted jurisdiction, the Ninth Circuit reversed

and held that the Corps had “unreasonabl[y]” asserted

jurisdiction over the project site. Res. Invs., Inc. v. U.S.

Army Corps of Eng’rs, 151 F.3d 1162, 1169 (9th Cir. 1998).

Specifically, the court concluded that because the project

in question was a solid waste landfill, rather than a fill or

dredged material project, the Corps “lacked authority

under section 404 of the CWA to require RII to obtain a

permit from the Corps before constructing the solid waste

landfill.” Jd. at 1168. Accordingly, the court reversed the

district court and vacated the Corps’ order. Three months

later, in October 1998, RII finally began construction on

the landfill—“approximately a decade after [they] began

23

the federal ... permitting process.” Res. Invs., Inc., 85

Fed. Cl. at 462.*

The Cofps’ incorrect jurisdictional determination over

RII’s property is an example of the enormous costs that

the Section 404 process can impose on landowners—and

the clear need for judicial review. The Corps’ permitting

process was both long (about seven years) and incredibly

expensive (costing “several millions of dollars”). Jd.; see

also Res. Invs., Inc. v. U.S. Army Corps, No. 96-5920,

1319 (W.D. Wash. Oct. 31, 1996). The result was that RII’s

multi-million dollar investment in the project remained

stranded, causing the company to lose “millions of dollars

of revenue each year” that it could not obtain a permit

from the Corps. Res. /nvs., Inc., 85 Fed. Cl. at 510. This

is exactly the type of delay and expense that immediate

review of a judicial determination would avoid.

Put simply, it is an understatement to say that the

Section 404 permitting process is long and costly. It is

impossible to know the full extent of the aggregate time,

energy, and capital that landowners have dissipated in

the administrative quagmire that is the Corps’ CWA

permitting process.‘ But even just a general description

3. Following the conclusion of the permitting process, RII

sued the United States, claiming that the Corps’ conduct in the

permitting process constituted a regulatory taking. See Res. Invs.,

Inc., 85 Fed. Cl. 447. After finding genuine issues of material fact,

see id., the Court of Federal Claims subsequently dismissed the

case for lack of jurisdiction, see Res. Invs., Inc. v. United States, 114

Fed. Cl. 639, 644 (Fed. Cl. 2014). A petition for writ of certiorari is

currently pending before this Court. See Res. Invs., Inc. v. United

States, No. 15-802 (S. Ct.).

4. Forreference, implementation of the WOTUS Rule alone was

estimated by the agencies themselves to increase permitting costs

24

of the process itself and the example of RII’s experience

demonstrate that this path is an untenable option for many

landowners.

C. Going Forward with a Project and Inviting

Severe Civil and Criminal Penalties Is Not a

Viable Option.

It also is not a tenable option for individuals or

businesses to ignore a jurisdictional determination, to

proceed with their planned activities, and then to await

prosecution. Indeed, the Corps essentially concedes

as much. See Pet. Br. 50-51. The CWA imposes severe

criminal and civil liability for those who discharge

materials without obtaining the required permits. See,

e.g., 33 U.S.C. § 1319(©)(1) (providing that any person who

negligently violates the CWA may be imprisoned for up to

one year); 74 Fed. Reg. 626, 627 (Jan. 7, 2009) (authorizing

fines up to $37,500 per violation per day). Only the most

fearless would press forward and simply “wait for the

agency to drop the hammer.” Sackett v. EPA, 132 S. Ct.

1367, 1372 (2012).

The Corps argues that a landowner choosing this path

would not receive disfavor from the agency or a federal

court. See Pet. Br. 30-31. But this is simply unrealistic.

Federal caselaw is replete with instances in which

courts have castigated individuals for ignoring agency

jurisdictional determinations. See, e.g., United States

for affected businesses by $19.8 million to $52.0 million annually.

See Economic Analysis of Proposed Revised Definition of Waters of

the United States, U.S. Environmental Protection Agency and U.S.

Army Corps of Engineers, 13 (Mar. 2014).

25

v. Moses, 496 F.3d 984, 989, 991 (9th Cir. 2007) (noting

that the defendant “should have listened” to the Corps

“before he undertook to ignore the government’s steady

trickle of warnings,” and disputing the defendant’s “right

to continue [his activities] after jurisdiction was duly

asserted”).

It simply is impracticable for individuals to invite

government prosecution as a means of challenging

jurisdictional determinations. Only those who are

“courag[eous] or foolhard[y],” id. at 992, will ignore the

Corps’ assertion of jurisdiction and go forward with their

business plans. Very few are willing to risk jail time and

heavy fines in the face of federal demands. And even those

who do go forward will have jurisdictional determinations

held against them. Contrary to the Corps’ representations,

juries and courts will not view the receipt of a jurisdictional

determination as just “additional information” that an

individual was free to disregard. Pet. Br. 16. A landowner

ignores a jurisdictional determination at his peril: he will

be seen as showing “contempt” and “disdain” for federal

law, Moses, 496 F.3d at 986, 992, and the punishments he

receives will be fair because he “should have listened,” id.,

to the Corps before taking matters into his own hands.

Thus, although landowners might theoretically have

the option to proceed with their plans in potential violation

of the CWA, the material risk of exorbitant fines and even

imprisonment makes this purported option illusory. If

a jurisdictional determination leaves a landowner with

the prospect of engaging in willful civil disobedience and

accepting the attendant exposure to civil and criminal

penalties, then it clearly is an agency action “from which

‘legal consequences will flow.” Bennett, 520 U.S. at 177-78

(citation omitted).

26

D. Abandoning Beneficial Activities and Foregoing

Judicial Review Are Not Viable Options.

An individual facing an unfavorable jurisdictional

determination has a final option: give up and accept

defeat. Those who lack the time and money to navigate the

permitting process or to endure a government enforcement

action may well forego their activities entirely and leave

the land fallow.

But such a decision would endanger myriad worthwhile

activities that currently require a Section 404 permit. If

“waters of the United States” are present, countless

activities are swept within the Corps purview, including,

among others (1) depositing fill, dredged, or excavated

material; (2) grading or mechanized land clearing;

(3) ditch excavation activities; (4) fill for residential,

commercial, or recreational developments; (5) road

fills and placement of rocks and other materials to

prevent erosion; (6) the building of any infrastructure

or impoundment requiring rock, sand, dirt, or other

material for its construction; (7) site-development fills for

recreational, industrial, commercial, residential or other

uses; (8) causeways or road fills; (9) dams or dikes; (10)

cultivation for idle areas; (11) forest roads to aid in timber

harvest; (12) rock crushing activities that result in loss

of natural drainage characteristics; (13) soil removal; and

(14) certain vegetation-disturbing operations. See, e.g., 33

C.F.R. § 323.2(f). The list goes on.

Following a jurisdictional determination, the “option”

of surrendering potential productive uses of one’s land is

probably the most palatable alternative for risk-averse

landowners. It also may have the greatest negative

impact on the economy when considering the aggregate

27

consequences of the unrealized benefits of developing

productive uses of land.

Indeed, one of the greatest challenges facing America

in the 21st Century is the rebuilding of the nation’s

transportation infrastructure. “[S]imply put, transit gets

people to their jobs, helps grow the economy in multiple

ways, and gives people the opportunity to get to health

care, school, recreation, and shopping.” Testimony of

Janet Kovinoky, U.S. Chamber of Commerce, before the

U.S. Senate Committee on Banking, Housing, and Urban

Affairs at 2 (Apr. 23, 2015), https://www.uschamber.

com/sites/default/files/150422 kavinoky testimony _

to_senate banking.pdf. But it is well documented that

“the performance of the U.S. transportation system is

not keeping pace with the demands on that system,” as

passenger travel and freight traffic have steadily grown

but infrastructure investments have not. Transportation

Performance Index: Key Findings, U.S. Chamber of

Commerce (2010), https://www.uschamber.com/sites/

default/files/legacy/lra/files/LRA Transp _Index_

Key_Findings.pdf. Indeed, the U.S. Department of

Transportation estimates that $18 billion a year will be

needed to bring public transit systems to a state of “good

repair” by 2028. See U.S. Department of Transportation,

2010 Status of the Nation’s Highways, Bridges, and

Transit: Conditions and Performance (2010).

Despite this urgent need for transportation

investments, infrastructure projects are frequently mired

in red tape, as they “often require multiple permits and

reviews from federal agencies and bureaus responsible

for ensuring projects are built safely.” White House

Press Release, Fact Sheet—Building a 21st Century

Infrastructure: Modernizing Infrastructure Permitting

28

(May 14, 2014); see also Kovinoky, supra, at 9 (highlighting

the need for “transportation policies that cut through

red tape at all levels of government so that projects

move forward quickly”). These restrictions hamper the

country’s ability to build a national transportation network

that both “supports jobs in the near term ... [and] boosts

economic growth and U.S. competitiveness over the long

term.” Transportation Performance Index, supra, at 7.

This Court should not impose yet another roadblock in

the completion of projects vital to this country.

CONCLUSION

The judgment of the court of appeals should be

affirmed.

Respectfully submitted,

Kate CoMERFORD Topp MICHAEL H. Park

STEVEN P. LEHOTSKY Counsel of Record

WARREN POSTMAN Consovoy McCartuy Park PLLC

U.S. CHAMBER Three Columbus Circle, 15th Floor

LITIGATION CENTER New York, New York 10019

1615 H Street, NW (212) 247-8006

Washington, DC 20062 park@consovoymccarthy.com

(202) 463-5337

WILLIAM S. Consovoy

J. MICHAEL CONNOLLY

Consovoy McCartuy Park PLLC

3033 Wilson Boulevard, Suite 700

Arlington, Virginia 22201

(703) 243-9423

Counsel for Amicus Curiae

March 2, 2016