Amicus Curiae Brief — Pozsgai v. United States

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No. 93-733

In The ™

Supreme Court of the United States

October Term, 1993

¢

JOHN POZSGAI and GIZELLA POZSGAI,

Petitioners,

V.

UNITED STATES OF AMERICA,

MERCER WRECKING & RECYCLING CORPORATION,

J. VINCH & SONS, INC.,

Respondents.

¢

On Petition For Writ Of Certiorari

To The United States Court Of Appeals

For The Third Circuit

¢

BRIEF AMICI CURIAE OF MOUNTAIN STATES

LEGAL FOUNDATION, THE ALLIANCE FOR

AMERICA, AND THE FAIRNESS TO LAND OWNERS

rr COMMITTEE IN SUPPORT OF PETITIONERS

+

Paut M. Sisy

WILLIAM Perry PENDLEY*

(*Counsel of Record)

MountTAIN States LEGAL FOUNDATION

1660 Lincoln Street, Suite 2300

Denver, Colorado 80264

(303) 861-0244

Counsel for Amici Curiae

COCKLE LAW BRIEF PRINTING CO., (800) 225-6964

OR CALL COLLECT (402) 342-2831

TABLE OF CONTENTS

Page

IDENTITIES AND INTERESTS OF AMICI CURIAE... 2

OPINIONS BELOW, JURISDICTION, STATUTES

INVOLVED AND STATEMENT OF THE CASE... 3

SUMMARY OF THE ARGUMENT ................. 3

I. INTRODUCTION: SECTION 404: THE GOV-

ERNMENT’S PENCHANT FOR OVERREGULA-

A. THE REGULATORY HYDRA: REGULAT-

SOO CHUN GAOWED 56 545455 ceed beeen ceeds 8

1. THE CORPS’ REGULATIONS PUR-

PORT TO REGULATE ONLY TRULY

PERIT Ge. FAD oaks science ccasenens 8

2. NATIONWIDE REACTION. TO THE

CORPS/EPA’S DRY “LAND GRAB”... 9

B. THE PENCHANT FOR OVERREGULA-

TION SIGNIFICANTLY IMPACTS THE

REGULATED COMMUNITY .............. 11

Il. IN ENACTING THE CLEAN WATER ACT,

CONGRESS DID NOT INTEND TO INCLUDE

ALL AREAS THAT MEET REGULATORY WET-

LANDS DEFINITION WITHOUT REGARD TO

THE EFFECT OF THEIR USE ON INTERSTATE

te ere eer ry er ere Perr 12

A. THE CLEAN WATER ACT DOES NOT

REACH TO THE CONSTITUTIONAL LIMIT

OF THE CONGRESSIONAL POWER TO

REGULATE INTERSTATE COMMERCE..... 13

il

TABLE OF CONTENTS - Conitinued

Page

B. THE “EFFECT ON COMMERC-E TEST” IS

AN ESSENTIAL ELEMENT iN [VETERMIN-

ING WHETHER AN ACTIVI?tlY COMES

WITHIN THE COMMERCE CL-AUSE...--- 14

C. CONGRESS NEVER EXPLICITLY’ REQUIRED

THE REGULATION OF ALL /ACTIVITIES

THAT IN ANY WAY AFFECT AANY AREAS

CONTAINING WETLANDS MEFETING THE

CORPS’ AND EPA’S REGULATORY DEFINY-

iil

TABLE OF AUTHORITIES

Page

Cases

1902 Atlantic, Ltd. v. Hudson, 574 F. Supp. 1381

(B.D. Va. 1963) ....---.cccecescccccecscsseccecees 5, 6

Construction Aggregate Transport, Inc. v. Fla. Rock

Industries, Inc., 710 F.2d 752 (11th Cir. See 13

Del Rio Distributing Co., Inc. v. Adolph Coors Co.,

589 F.2d 176 (5th Cir. 1979).....-----eee creer rere 14

Goldfarb v. Virginia State Bar, 421 U.S. 773 (1975) .... 13

Harrison v. P.P.G., 446 U.S. 578 (1980) ....----- eee eee 8

Heart of Atlanta Motel v. United States, 379 US. 241

CL ica whee ansessaskinepeniescseeessese: 17

Hodel v. Virginia Surface Mining and Reclamation

Assn., 452 U.S. 264 (1981).....------ eee eee 13, 15, 18

Katzenbach v. McClung, 379 U.S. 294 (1964) ........--- 17

McClain v. Real Estate Board of New Orleans, Ins.,

444 U.S. 232 (1980) .....---- cece eeeeeeeecees ae

Perez v. United States, 402 U.S. 146 td | 17, 18

United States v. Darby, 312 U.S. 100 (1941). ... 16, 17, 18

United States v. Larkins, 852 F.2d 189 (6th Cir.

1988), cert. denied, 109 S.Ct. 2231 (1909) ......-.%.. 6, 7

United States v. Ocie Mills, 817 F. Supp. 1546 (N.D.

NE ccs Lab ivawas desea ne nbe ine Cate sene ses 5

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

U.S. 121 (1985) ...... 2. cece cece eee ercees ry Te

United States v. Women’s Sportswear Assn., 336 U.S.

NT inc fins s sank ek sce ssseee aren se aeee eres 15

iv

TABLE OF AUTHORITIES - Continued

Page

CONSTITUTION

Bk eer rer ere re rT Terr Tere Tce 13

STATUTES AND REGULATIONS

ek ae Ss rer re rer rr ee ere erry err here 17

Be Cy te es Sh aed cae weds deen 26 edu ee caae Aaa 4

ee SRA RE OO OBE 5 6 os ec se 8 SEES ee hs OS a

ee BA SPEED So rons ss Shae caged en eord sey nae 4

BE RA B&F eee pa ee ee re rn ey ate arr 4

I ee hs ce Gia eee ee ee eae baw ee Kees 11

RR Re | Pere oer er eee eee rey erry 4

ee es ee I Fo haan cane Meh eae kna teen ee Be eaRt 11

ee Ce OP I Te i 954 oe cwenaneu cease dhctes ss 14

ee Gen Oe DS 6 6 on 6 x6 kaa s dak eeu e awe 14

42 U.S.C. § 2000(c) 7 COLES Eee ET CEE ey ee ee rane 14

ee I ed rhe kn cd cemaketan day cease eee 8

Bt eS | errr rrr errr ory errs er rer ae 8

ee gs eee 8

ee Ps Ss Ee CROs orcacuseestawseensxcsakcusaes 7

LEGISLATION

Legislative History of the Clean Water Act of 1977,

Ge OE BOON ag kes 05 005s Kanda ss Mah ahs > Owee ba eA 6

Vv

TABLE OF AUTHORITIES - Continued

Page

OTHER AUTHORITIES

Audubon Magazine, July (1990). ...............0 eee eee 9

Farm journal, June/July (1990). « ... 6c cce cae ceccdans 10

EPA: “America’s Wetlands: Our Vital Link

Between Land and Water” (1988) ................. 10

Thomas Jefferson, Writings, Vol. XIX ................. 3

No. 93-733

+

In The

Supreme Court of the United States

October Term, 1993

¢

JOHN POZSGAI and GIZELLA POZSGAI,

Petitioners,

UNITED STATES OF AMERICA,

MERCER WRECKING & RECYCLING CORPORATION,

J. VINCH & SONS, INC.,

Respondents.

+

On Petition For Writ Of Certiorari

To The United States Court Of Appeals

For The Third Circuit

¢

BRIEF AMICI CURIAE OF MOUNTAIN STATES

LEGAL FOUNDATION, THE ALLIANCE FOR

AMERICA, AND THE FAIRNESS TO LAND OWNERS

COMMITTEE IN SUPPORT OF PETITIONERS

+

Mountain States Legal Foundation (“MSLF”) respect-

fully submits this brief amici curiae in support of John

Pozsgai and Gizella Pozsgai, the Petitioners for writ of

certiorari.}

! Amici have obtained the written consents of the parties.

The written consents have been provided to the Clerk of the

Court.

1

2

IDENTITIES AND INTERESTS OF AMICI CURIAE

The Alliance for America (“Alliance”) is a fifty state

network of nearly five hundred independent grassroots

organizations, whose collective membership numbers in

the millions. These groups represent a variety of voca-

tional, cultural, and political interests including farming,

grazing, forestry, commercial fishing, mining, recreation,

energy, animal welfare, private property protection, local

government and various community and regional organi-

zations. The Alliance was formed in 1991, and is intent on

curbing excessive governmental regulation and the viola-

tion of constitutionally protected property rights result-

ing in family and community despair.

The Fairness to Land Owners Committee (“FLOC”) is

a Maryland-based, national organization with over 13,000

.~ members who are property owners faced with confisca-

tory land-use regulations involving a number of federal

and state statutes. FLOC is dedicated to protecting prop-

erty rights, especially the right to the prudent use of

one’s own land, and is active in educating the public and

lawmakers about the difference between conservation

and confiscation.

MSLF is a non-profit, membership public interest law

foundation dedicated to bringing before the courts those

issues vital to the defense and preservation of individual

liberties, the right to own and use property, limited gov-

ernment and the free enterprise system. MSLF’s members

include businesses and individuals who live and work in

nearly every state of the country. A large number of

MSLF’s members work in businesses involved in the utili-

zation and development of natural resources and, as a

result, are actively involved in many environmental

issues.

Many of amici’s members are engaged in farming and

ranching activities across the country. Farming and

ranching have long been recognized as the backbone of

this nation:

i a |

3

Whenever there are in any country uncultivated

lands and unemployed poor it is clear that the

laws of property have been so far extended as to

violate natural right. The earth is given as a

common stock for men to labor and live on... .

The small landowners are the most precious

part of the state.

Thomas Jefferson, Writings, Vol. XIX, p. 17.

As demonstrated herein, the implications of the

Pozsgai case far transcend the Pozsgai’s individual situa-

tion and are indicative of problems of nationwide magni-

tude. This case presents serious questions of how

individual rights are to be protected from governmental

excesses, both in the enforcement of laws, for the ostens-

ible protection of the environment, and the administra-

tion of justice. Amici believe it is vitally important for this

Court to protect these individual freedoms in the face of

increasing civil and criminal enforcement under the

Clean Water Act (“CWA”), 33 U.S.C. § 1251 et seq.

Amici’s interests in the outcome of this lawsuit are

directly tied to their members’ private property rights.

Amici have serious concerns that the ruling of the Third

Circuit does violence to precedents written by this Court

which recognize the constitutional limitations of our fed-

eral government.

OPINIONS BELOW, JURISDICTION, STATUTES

INVOLVED AND STATEMENT OF THE CASE

Amici hereby adopt Petitioners’ statement and

description of the opinions below, jurisdiction, statutes

involved, and statement of the case.

SUMMARY OF THE ARGUMENT

This case presents this Court with an extremely

important constitutional issue on the reach of federal

jurisdiction under the Commerce Clause, which has grave

consequences for thousands of private property owners

+

whose farms, back yards, or one-quarter acre lots are

subjected to strict and overly burdensome federal land-

use control under the CWA. However, the CWA is not a

federal land-use statute, its purpose is to protect water

quality. The Army Corps of Engineers (“Corps”) and the

Environmental Protection Agency (“EPA”) have assumed

jurisdiction under the CWA which, given their penchant

for overregulation, has caused them to regulate private

property without any nexus to interstate commerce.

REASONS FOR GRANTING THE WRIT

I. INTRODUCTION: SECTION 404: THE GOVERN-

MENT’S PENCHANT FOR OVERREGULATION

The CWA, which was known as the Federal Water

Pollution Control Act at the time of its enactment in 1972,

is a comprehensive effort by Congress to restore and

maintain the “chemical, physical, and biological integrity

of the nation’s waters.” 33 U.S.C. § 1251(a). However, as

laudatory as these goals may be, the actual legal require-

ments are found in other sections of the statute.

The cornerstone of the regulatory scheme established

by the CWA is Section 301, 33 U.S.C. § 1311, which

prohibits the discharge of “any pollutant” into “navigable

waters,” except when in compliance with various sections

of the CWA, including Section 404, 33 U.S.C. § 1344.

Section 404 establishes a program whereby the Corps

issues permits for the “discharge of dredged and fill

material.” The Section 404 program is somewhat of an

orphaned hybrid which arose out of the combination of

the historic regulation by the Corps of obstructions to

navigation under the Rivers and Harbors Act of 1899, 33

U.S.C. § 403, and the environmental concerns of the

CWA.

A troublesome shortcoming of the Section 404 pro-

gram is that it bears, at best, a strained relationship to the

purposes of the CWA, as evidenced by both the civil and

criminal enforcement actions brought against Petitioners.

5

The purpose of the CWA is to protect water quality, not to

regulate land-use. As stated recently by Judge Vinson in a

similar CWA enforcement action:

This case presents the disturbing implications of

the expansive jurisdiction which has been

assumed by the United States Army Corps of

Engineers under the Clean Water Act. In a rever-

sal of terms that is worthy of Alice In Wonder-

land, the regulatory hydra which emerged from

the Clean Water Act mandates in this case that a

landowner who places clean fill dirt on a plot of

subdivided dry land may be imprisoned for the

statutory felony offense of “discharging pollu-

tants into the navigable waters of the U.S.”

United States v. Ocie Mills, 817 F. Supp. 1546, 1548 (N.D.

Fla. 1993) (emphasis in original).

The substance of the CWA’s jurisdictional boundaries

has not been altered by Congress since 1977. Even when

Congress considered the 1977 amendments to Section 404,

it attempted to curb what many members of Congress

perceived as “the Corps’ penchant for overregulation,

particularly in cases of de minimus environmental con-

cern.” 1902 Atlantic, Ltd. v. Hudson, 574 F. Supp. 1381,

1397-98 (E.D. Va. 1983). The 1902 Atlantic, Ltd. Court's

quotation from a colloquy during the floor debate on the

Senate bill, (S. 1952) between Senator Muskie (the Senate

manager of the 1977 amendments) and Senator Bentsen,

is illustrative of Congress’ concern for the Corps’ pen-

chant for overregulation:

MR. BENTSEN: Mr. President . . . Section 404

has become a symbol to many Americans of

how a well-intended legislative initiative can

turn into a quagmire of disruption, frustration,

and bureaucratic entanglement for the ranchers,

farmers, foresters, and average citizens of this

country.

6

* * *

Section 404 has become synonymous with Fed-

eral overregulation, overcontrol, cumbersome

bureaucratic procedures, and a general lack of

realism. ...

* be .

During Senate consideration on the conference

report on the Clean Water Act of 1977, Senator

Muskie, who also was one of the Senate con-

ferees, stated that the statements made during

Senate debate, such as the statements above,

adequately reflect the legislative intent with

respect to Section 404.

1902 Atlantic, Ltd., 574 F. Supp. at 1398, n.16 (quoting

Legislative History of the Clean Water Act of 1977, Vol.

3-4, pp. 470, 901-902 (1978)) (emphasis added).

Unfortunately, despite the concerns expressed in

1977, by Senators Bentsen and Muskie, things have

become worse — not better. The “penchant for overregula-

tion” (by both the Corps and EPA) now victimizes

farmers and landowners nationwide, including amici’s

membership, as the Corps and EPA attempt to use the

CWA to expand their “regulatory turf” out of the water,

out of the swamps and marshes, straight onto dry land.

Much like Judge Vinson’s discomfort with the Corps’

regulatory framework, in United States v. Larkins, 852 F.2d

189 (6th Cir. 1988), cert. denied, 109 S.Ct. 1131 (1989),

Circuit Judge Merritt went out of his way, sua sponte, to

criticize the Corps’ overexpansive jurisdictional

approach:

[T]he Corps has not expanded the definition of

“navigable waters” to include any creek or

stream or moist area. .. . “Under such a con-

struction [as proposed by the Corps of Engi-

neers] low lying backyards miles away from a

navigable waterway would become wetlands.”

[citation omitted] The Corps’ definition has

7

apparently detached and untied the “wetlands”

jurisdiction of the Corps from any concept of

“open waters” or navigable waters. A farmer’s

low lying farmland or a homeowner’s low lying

backyard — adjacent to a small stream or creek

many miles from any navigable waterway — has

apparently been converted into government

property no longer subject to control or

improvement by the owner without government

permission. A “wetlands” has apparently been

read to include simply “moist land adjacent to a

creek.” The framers of the Constitution were

solicitous of the rights of landowners - espe-

cially small farmers struggling for survival — not

to have land appropriated by the government.

They therefore adopted the provision of the

Fifth Amendment of the Constitution prohibit-

ing the taking of private property for public use

without just compensation.

United States v. Larkins, 852 F.2d at 193 (Merritt, J., concur-

ring).

Unlike the present case, Larkins involved land cov-

ered in part with “knee deep waters” and cypress trees,

659 F. Supp. 76, 79, containing numerous sloughs and

depressions which defendants filled, 852 F.2d at 190, and

which previously “tended to be covered by standing

water.” Id. at 191. Although this Court has held that a

“taking” claim is no defense to a § 404 enforcement

action, see United States v. Riverside Bayview Homes, Inc.,

474 U.S. 121, 127-28 (1985), as indicated by Judge Merritt

in Larkins, it is fundamentally wrong for the government

to try and seize control of its citizens’ property under the

pretext of enforcing an “anti-water pollution” statute. See

Exec. Order 12630, March 15, 1988, 53 Fed. Reg. 8859,

“Governmental Actions and Interference With Constitu-

tionally Protected Property Rights” (directing each

8

agency to account for Fifth Amendment “taking” con-

cerns in carrying out actions, including regulatory and

permitting functions).

A. THE REGULATORY HYDRA: REGULATING

DRY LAND.

1. THE CORPS’ REGULATIONS PURPORT

TO REGULATE ONLY TRULY AQUATIC

AREAS.

The new trend (i.e., regulating under § 404 as if it

were a “land preservation statute,” instead of an “anti-

water pollution” statute), even stands in direct contradic-

tion to the Corps and EPA’s own regulations. The regula-

tions defining “wetlands” have remained unchanged

since 1977. After defining “wetlands,” the regulations

further clarify the definition by stating that “[w]Jetlands

generally include swamps, bogs, marshes, and similar

areas.” 33 C.F.R. § 328.3(b). As stated in the preamble to

the 1977 regulations, this language was included to dem-

onstrate the intent of the Corps to include “only truly

aquatic areas.” 42 Fed. Reg. 37,129 (1977).

Notably, the Corps’ clarifying sentence of its “wet-

lands definition” does not state that wetlands generally

include corn fields, soybean fields, and vacant lots. Thus,

unless corn fields, soybean fields, and vacant lots are

“similar areas” to “swamps, marshes, and bogs,” 33 C.F.R

§ 328.3(b), regulatory jurisdiction cannot attach.

The rule of ejusdem generis demands that “where gen-

eral words follow an enumeration of specific things, the

general words are read as applying only to other items

akin to those specifically enumerated.” Harrison v. P.P.G.,

446 U.S. 578, 588 (1980).

The general words “similar areas” follow the more

specific words “swamps, marshes, bogs” in the definition

of wetlands contained in 33 C.F.R. § 328.3. Consequently,

for land to be considered a “wetland,” it must be the

same type of area as a swamp, marsh, or bog. The Corps

9

and EPA, however, have recently attempted to discard

this plain reading, and now interpret the phrase “similar

areas” to mean “other areas” — including cultivated farm

fields, dry lots, and other typically non-aquatic areas.

Why the new quest to regulate dry land? An environ-

mental group’s recent publication sheds light on the

Corps’ motive — bureaucratic self-preservation:

For civil engineers in general, environmental

projects offer a boundless future. For the Corps

in particular they mean job security. The day of

huge river basin projects has passed; with grow-

ing public resistance to such projects, and tight-

ening budget constraints, the Corps could be

relegated to custodian status. Environmental

engineering offers the Corps steady work, an

image pure and true — and an almost bottomless

pork barrel.

Audubon Magazine, July, 1990, at 111. Thus, from the

Corps own self-interest arose a new Manual for making

jurisdictional determinations over supposed “wetlands.”

2. NATIONWIDE REACTION TO THE

CORPS/EPA’S DRY “LAND GRAB.”

Concern over the Corps and EPA’s wetlands regula-

tory expansion (and abuse) is growing nationwide, with

good reason. The “Federal Manual for Identifying, and

Delineating Jurisdictional Wetlands,” which was pub-

lished as a joint effort between the Corps, EPA, and two

other agencies on January 10, 1989, sets forth “mandatory”

technical criteria and methods for identifying and delin-

eating jurisdictional wetlands. The new Manual and the

expanding regulatory policies of the agencies have

recently met with sharp criticism by Congress. For exam-

ple:

Unfortunately, the current direction of our wet-

lands policy is progressing in ways that were

never envisioned by Congress. The changes that

10

are being attempted do not follow congressional

intent. Rules and regulations are being written

by bureaucrats who believe they have long been

stifled over at EPA during the past eight years,

and now, giving them an inch, they are taking a

mile.

The Federal Manual for Identifying and Delin-

eating Jurisdictional Wetlands, written from

within the bowels of the Interior Department

makes serious changes in our definition of wet-

lands. These changes were never proposed or

discussed before a Committee of this Congress,

nor were the changes proposed in the Federal

Register. This new definition substantially

impacts our nation, particularly rural areas, and

enhances our government’s “land grab” abili-

ties.

Testimony of Congressman Emerson before the Subcom-

mittee on Water Resources, Committee on Public Works

and Transportation: “Wetlands Hearing,” February 28,

1990.

Similarly, former President Bush, who announced the

“no net loss of wetlands” policy which energized the

Corps and EPA to draft the Manual in question, has

stated the Executive Branch’s concerns with the agencies’

overregulation:

We are trying to do a better job of getting these

agencies to work together, but you have zealots

in various levels of the bureaucracy. We will try

very hard from the top on down to get the

clarification that is needed to avoid this frustra-

tion among farmers. I am not happy with

is. .-.:.

June/July, 1990, Farm Journal, p. 17.

11

B. THE PENCHANT FOR OVERREGULATION

SIGNIFICANTLY IMPACTS THE REGULATED

COMMUNITY.

The national significance of this case, and the nation-

wide magnitude of the problem faced by landowners, is

heightened by the Corps/EPA attempt to leave behind

their aquatic jurisdictional boundaries and come onto dry

land. A revealing and alarming portrait of these agencies’

view of their expanding jurisdiction is found in a fairly

recent EPA publication which states: “If there’s not a

wetland in your neighborhood, there’s probably one

nearby.” EPA: “America’s Wetlands: Our Vital Link

Between Land and Water,” p. 1 (1988). Landowners across

the nation have become outraged and adamantly disagree

with the agencies’ claims that their dry, solid-ground

constitutes “navigable water” under the CWA, and that

merely moving dirt (not “cellar dirt,” 33 U.S.C. § 1362(6))

in a field, or on a dry lot, is considered a “discharge of a

pollutant into water.” Thus, Petitioners’ statutory ques-

tion presented, whether, as a matter of statutory inter-

pretation, § 1362(6) of the CWA, which defines

“pollutants” as certain materials “discharged into water,”

can be construed to mean the discharge of clean fill “near

water” or “onto wetlands,” is an important question for

this Court to decide.

Significantly, many, if not most landowners (such as

Petitioners) find themselves confronted with the agen-

cies’ jurisdictional claim only after they have already com-

menced work on what any reasonable person would view

as a non-aquatic area. When the agencies assert jurisdic-

tion and inform the landowner that he or she is a “viola-

tor” and a “water polluter” subject to the wide gambit of

potential penalties and injunctive relief set forth in the

CWA, see 33 U.S.C. § 1319, the landowner is placed in a

precarious position indeed. He can capitulate, face an

“enforcement action,” or attempt to obtain judicial declar-

atory relief for an action which no reasonable man would

have considered to be illegal. The agencies then typically

12

capitalize on their superior bargaining position and the

extreme imbalance of economic and other resources to

extort “mitigation” by offering the “carrot” of a § 404

permit, all the while “wielding the club” of enforcement,

which includes the threat of imprisonment, fines, costly

litigation and/or “restoration” — alternatives and risks

the agencies know the unfortunate landowner can ill

afford.

Il. IN ENACTING THE CLEAN WATER ACT, CON-

GRESS DID NOT INTEND TO INCLUDE ALL

AREAS THAT MEET THE REGULATORY WET-

LANDS DEFINITION WITHOUT REGARD TO

THE EFFECT OF THEIR USE ON INTERSTATE

COMMERCE.

Amici submit that the Third Circuit has oversim-

plified Commerce Clause principles and largely ignored

the “effect on commerce” test to be used in determining

whether a Commerce Clause nexus exists. Amici certainly

do not deny that Congress has broad power under the

Commerce Clause to affirmatively regulate activities

which cumulatively have a significant effect on interstate

or foreign commerce, even if a particular individual activ-

ity alone does not have a major effect. However, Con-

gress, in enacting the CWA, never expressed an intent to

dispense with the test that there is discretion to deter-

mine, on particular facts, whether the minimal Commerce

Clause nexus has been met. Thus, Congress never explic-

itly exercised its Commerce Clause powers to regulate, as

a class, all wetlands, however defined, as it has for other

regulatory programs designed to control activities such

as strip mining and loan sharking.

Given this lack of express legislative intent, the Third

Circuit seriously departed from the teachings of this

Court and the practice of its sister circuits by failing to

analyze what effect, if any, on interstate commerce is

caused by Petitioners’ placement and maintenance of

clean fill material on their private property. The Third

13 .

‘“

Circuit’s alleged nexus to interstate commerce is not

predicated upon any allegation by the government that

the placement of clean fill on Petitioners’ property hun-

dreds of yards from a drainage stream does exert, or can

reasonably be expected to exert, an effect on interstate

commerce; rather, the nexus arises solely from the geo-

graphical and historical fact that Petitioners’ property is

adjacent to a drainage ditch or stream that is a tributary of

a waterway that was used in interstate commerce in the

1800's.

It has generally been held that to fall within Article I,

§ 8, Cl. 3 (the “Commerce Clause” of the Constitution) an

activity must satisfy either (1) the “in commerce” test or

(2) the “effect on commerce” test. The “in commerce” test

requires that the subject activity be part of one or more

interstate transactions, or that the activity be “an integral

part of the transaction, inseparable from the interstate

aspects.” Goldfarb v. Virginia State Bar, 421 U.S. 773 (1975)

(title examination held an integral part of the interstate

residential real estate financing market); Construction

Aggregate Transport, Inc. v. Fla. Rock Industries, Inc., 710

F.2d 752, 766-67 (11th Cir. 1983) (when antitrust plaintiff

and defendant engaged in purely intrastate business, “it

[was] clear that ‘in commerce’ or ‘flow of commerce’

theory of jurisdiction [was] not available . . . of

A. THE CLEAN WATER ACT DOES NOT REACH

TO THE CONSTITUTIONAL LIMIT OF THE

CONGRESSIONAL POWER TO REGULATE

INTERSTATE COMMERCE,

Loose language in several lower court decisions

assert that the CWA reaches as far as the Commerce

Clause permits. Significantly, however, this Court in Riv-

erside Bayview expressly declined the invitation to endorse

these dicta. Id. at 135, 137, 138. After all, so long as a

substantial effect on interstate commerce is shown, Con-

gress may regulate the use of entirely dry land. Hodel v.

Virginia Surface Mining & Reclamation Association, 452 U.S.

14

264, 275-277, 281-283 (1981). Yet no one suggests that the

CWA permits the Corps or EPA regulate any land that is

used in interstate commerce without regard to the pres-

ence of water. Nor is it arguable that the CWA embraces

all aquatic sites with respect to which the Commerce

Clause might authorize federal legislation. Thus,

although the Civil Rights Act of 1964 reaches hotel swim-

ming pools (see 42 U.S.C. § 2000a(b)(1), (b)(4), (c)), pre-

sumably no one claims that they are within the

jurisdiction of the Corps or EPA under the CWA.

The upshot is that § 404 of the CWA, at most, reaches

the non-navigable portions and significant non-navigable

tributaries of waters actually or potentially navigable,

together with their immediately adjacent wetlands.

Accordingly, the Corps and EPA regulations at issue must

be condemned as unauthorized insofar as they purport to

regulate waters or wetlands which are not adjacent to a

navigable water system on non-wetland areas above the

line of mean high tides.

B. THE “EFFECT ON COMMERCE TEST” IS AN

ESSENTIAL ELEMENT IN DETERMINING

WHETHER AN ACTIVITY COMES WITHIN

THE COMMERCE CLAUSE.

The “effect” test has been variously interpreted to

require either (1) a “substantial effect” or (2) “not insub-

stantial” effect on interstate commerce. The leading

Supreme Court case on this test, McClain v. Real Estate

Board of New Orleans, Ins., 444 U.S. 232, 241-245 (1980),

seems to use the terms interchangeably, finding that an

antitrust plaintiff had demonstrated that a certain real

estate brokerage activity had a “substantial effect” on

interstate commerce so as to fall within the reach of the

Sherman Anti-Trust Act. See also Del Rio Distributing Co.,

Inc. v. Adolph Coors Co., 589 F.2d 176 (5th Cir. 1979).

The “effects” test does not universally require that a

particular defendant’s unlawful activity “directly” affect

commerce, Under proper circumstances, indirect effects

15

of the activity can be sufficient. Moreover, the effect of

the alleged injury may be examined in the context of

“cumulative” damage from the universe of similar activ-

ities. United States v. Women’s Sportswear Assn., 336 U.S.

460, 464 (1949).

The “effects” test was articulated by this Court in

Hodel v. Virginia Surface Mining and Reclamation Assn., 452

U.S. 264, 282 (1981). In Hodel, this Court upheld the

constitutionality of the Surface Mining Control and Recla-

mation Act of 1977, holding that the Commerce Clause

allows congressional regulation of “activities causing air

and water pollution, or other environmental hazards that

may have effects in more than one state.” The Hodel Court

also rejected petitioners’ argument that the subject of the

Act was “land use,” which was primarily a local activity.

To this Court, the commodity at issue - coal — moves in

interstate commerce. Therefore, this Court relied on the

long-standing rule that “Congress may regulate the con-

ditions under which goods shipped in interstate com-

merce are produced where the local activity of producing

these goods itself affects interstate commerce.” Id. (cita-

tions omitted.) However, this Court still emphasized:

[s]ome activities may be so private or local in

nature that they simply may not be in com-

merce. Nor is it sufficient that the person or

activity reached have some nexus with interstate

commerce. Our cases have consistently held that

the regulated activity must have a substantial

effect on interstate commerce.

452 U.S. at 311 (emphasis added.)

These principles have been especially applied in con-

struing the constitutional reach of the CWA. United States

v. Riverside Bayview Homes, 474 U.S. 121 (1985). In enact-

ing the CWA, Congress still required the executive branch

to determine if the requisite maximum nexus to interstate

commerce exists in specific cases.

16

C. CONGRESS NEVER EXPLICITLY REQUIRED

THE REGULATION OF ALL ACTIVITIES

THAT IN ANY WAY AFFECT ANY AREAS

CONTAINING WETLANDS MEETING THE

CORPS’ AND EPA’S REGULATORY DEFINI-

TION.

The Third Circuit erred in rejecting Petitioners’ claim

that the government failed to show how Petitioners’

property affects any interstate commerce, stating that

such jurisdiction was “irrebuttally presumed” by the

Corps’ regulations. Petitioners’ App. at 21a. The court

also erroneously relied upon a line of cases which suggest

that Congress’ Commerce Clause power is so broad in

scope that no activity can have too small an impact to

escape its reach. However, there is a key distinguishing

feature to this line of Commerce Clause cases - they

address situations where Congress had explicitly found

that a particular activity or activities, as a class, affect

interstate commerce and must be regulated as a class in

order to achieve specific legislative goals. In contrast,

Congress has never made such an explicit finding with

respect to all areas which contain wetlands meeting the

Corps’ and EPA’s regulatory definition.

For example, in United States v. Darby, 312 U.S. 100

(1941), this Court upheld an Act of Congress which pro-

hibited the employment of workers in the production of

goods for interstate commerce at other than prescribed

wages and hours. This Court found that Congress had

prescribed a “class of activities” to be regulated which

was properly within Congress’ Commerce Clause power

without proof that the particular intrastate activity had

an effect on commerce. A unanimous Court stated:

Congress has sometimes left it to the courts

to determine whether the intrastate activities

have the prohibited effect on commerce, as in

the Sherman Act. It has sometimes left it to an

administrative board or agency to determine whether

the activities sought to be regulated or prohibited

17

have such effect, as in the case of the Interstate

Commerce Act, and the National Labor Relations

Act, or whether they come within the statutory defi-

nition of the prohibited Act, as in the Federal Trade

Commission Act. And sometimes Congress itself

had said that a particular activity affects the

commerce, as it did in the present Act, the

Safety Appliance Act and the Railway Labor

Act. In passing on the validity of legislation of

the class last mentioned the only function of

courts is to determine whether the particular

activity regulated or prohibited is within the

reach of the federal power.

312 U.S. at 120-121 (emphasis added).

Similarly, in Heart of Atlanta Motel v. United States, 379

U.S. 241, 247 (1964), this Court upheld the constitu-

tionality of the 1964 Civil Rights Act which declared that

“any inn, hotel, motel, or other establishment which pro-

vides lodging to transient guest affects commerce per se”

as affirmatively regulating a class of activities in order to

protect individual civil rights. In a companion case,

Katzenbach v. McClung, 379 U.S. 294, 298 (1964), this Court

upheld the constitutionality of the restaurant provision of

the same Civil Rights Act which regulated the restaurant

“if... it serves or offers to serve interstate travelers or a

substantial portion of the food which it serves . . . has

moved in commerce.” In Perez v. United States, 402 U.S.

146 (1971), this Court held that Congress in enacting the

Consumer Credit Protection Act of 1964, 82 Stat. 159, 18

U.S.C. § 891, especially determined that “extortionate

credit activities” as defined by Congress, affect interstate

commerce. Therefore,

Congress appropriately considered the ‘total

incidence’ of the practice on commerce [and]

Where the class of activities is regulated

and that class is within the reach of federal

18

power, the courts have no power to ‘excise as

trivial individual instances’ of the class.

402 U.S. at 151 (citation omitted).

Further, even where the object of federal regulations

is environmental protection, the courts have looked for

congressional intent to exercise its plenary Commerce

Clause power to regulate all incidents of a class of activ-

ities. In Hodel v. Virginia Surface Mining & Reclamation

Association, the Court held that Congress had determined

that surface mining activities as a class, create adverse

environmental effects on interstate commerce and there-

fore are a proper subject for congressional regulation. In

so doing, this Court cited the

[C]ongressional finding that nationwide “sur-

face mining and reclamation standards are

essential in order to insure that competition in

interstate commerce among sellers of coal pro-

duced in different States will not be used to

undermine the ability of the several States to

improve and maintain adequate standards on

coal mining operations within their borders.” 30

U.S.C. § 1201(g).

452 U.S. at 281-282.

In contrast, the CWA is an example of where, in the

words of Darby, supra, Congress “left it to the administra-

tive board or agency to determine whether the activities

sought to be regulated or prohibited have the [required]

effect” on interstate commerce. Darby, 312 U.S. at 120. In

particular, Congress has never identified wetlands as a

class that automatically requires protection in all cases,

even in the admittedly rare instance of a purely isolated

waterbody which may have some incidental wetlands

vegetation but has no identifiable use with an effect on

commerce. Rather, Congress nowhere defined the term

“wetlands” or its exact relationship to “waters of the

United States.” Instead, it left that definition and its

application to the judgment of the executive branch. In

fact, while the legislative scheme set up in the CWA “to

EEE

19

restore and maintain the chemical, physical and biolog-

ical integrity of the Nation’s waters,” CWA § 101, 33

U.S.C. § 1251, was intended to expand federal regulation

beyond the reach of traditionally navigable waters, Con-

gress did not automatically include every waterbody,

however isolated, within the coverage of the Act. As this

Court noted in United States v. Riverside Bayview Homes:

In keeping with these views, Congress chose to

define the waters covered by the Act broadly.

Although the Act prohibits discharges into

“navigable waters,” [citations omitted], the

Act’s definition of “navigable waters” as “the

waters of the United States” makes it clear that

the term “navigable” as used in the Act is of

limited import. In adopting this definition of

“navigable waters,” Congress evidently

intended to repudiate limits that had been

placed on federal regulation by earlier water

pollution control statutes and to exercise its

powers under the Commerce Clause to regulate

at least some waters that would not be deemed “navi-

gable” under the classical understanding of that

term. See S. Conf. Rep. No. 92-1236, p. 144

(1972); 118 Cong. Rec. 33756-33757 (1972) (state-

ment of Rep. Dingell).

474 U.S. at 133 (emphasis added).

Thus, this Court’s Riverside Bayview decision does not

remotely suggest that the CWA embraces non-navigable

waterbodies that are not connected to any navigable

water system, much less isolated wetlands, wetlands

above the headwaters, or temporarily ponded rainwater.

This Court pointedly did not endorse the Government's

suggestion that the 1977 reconsideration of the statute

should be taken as proof that § 404, as enacted in 1972,

was intended to authorize the full sweep of the Corps’

regulations, including the provision that reaches “iso-

lated” waters and wetlands.

20

CONCLUSION

For the foregoing reasons, a writ of certiorari should

be issued to review the decision of the Third Circuit

Court of Appeals. The insidious assault which that deci-

sion permits against our constitutionally protected fed-

eral form of government must be turned back.

Respectfully submitted,

Pau. M. Sesy

WILLIAM Perry PENDLEY*

(*Counsel of Record)

MountTAIN STATES LEGAL FOUNDATION

1660 Lincoln Street, Suite 2300

Denver, Colorado 80264

(303) 861-0244

Attorneys for Amici Curiae

January 10, 1994