Reply Brief — Village of Oconomowoc Lake v. Dayton Hudson Corp.

Exprems Court, UE

SILED

AUG 4 1994

No. 94-304 | OFFICE OF THE CLERK

In The

Supreme Court of the United States

October Term, 1994

4

VILLAGE OF OCONOMOWOC LAKE,

Petitioner,

DAYTON HUDSON CORPORATION, et al.,

Respondents.

o-—

On Petition For Writ Of Certiorari

To The United States Court Of Appeals

For The Seventh Circuit

¢

PETITIONER’S BRIEF IN REPLY

¢

WituiaM S. Roush, Jr.*

KaTHRYN A. LONSDORF

Counsel for the Petitioner

Village of Oconomowoc Lake

Davis & KuELTHAU, S.C.

111 East Kilbourn

Suite 1400

Milwaukee, Wisconsin 53202

414-276-0200

* Counsel of Record

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

OR CALL COLLECT (402) 342-2831

;BEST AVAILABLE COPY

ae

*

eG ene 7 ies Se ty

TABLE OF CONTENTS

Page

pe kee te ae rere rr errr s ii

REASONS FOR GRANTING THE WRIT ........... 1

I. The Decision Of The Court Of Appeals Is Not

oo Per Tre ry Orr ra ST eres 1

I]. This Case Is Not “Moot” Under Any Circum-

| a Perey Cree eey OPE rE ey rr Ter TT er rer 4

A. Completion of Construction Does Not Pre-

clude the Granting of Effective Relief..... +

B. The Need For A Storm Water Operating Per-

mit Has Never Been Determined.......... 6

III. The Pendency Of Potential Legislation Is Not

Material To The Issues In This Case .......... 9

EEE cies ps aaueees es Nes bons sekaen se eeeeeel 10

Re pe een eR sR

ii

TABLE OF AUTHORITIES

FEDERAL CASES

Adickes v. S.H. Kress and Co., 398 U.S. 144 (1970)..... 8

Atlantic States Legal Foundation, Inc. v. Tyson Foods,

iuc., GBF PAG TES CRAG GA Bi ce kscncciasss.s: 6

Burbank Anti-Noise Group v. Goldschmidt, 623 F.2d

115 (9th Cir. 1980), cert. denied, 450 U.S. 965

(ROBES «un av s0dwend os adap nee ban Cee edc aes se 5

Chesapeake Bay Foundation v. Gwaltney of Smithfield,

oe ee ee re rr ee eee 6

Chevron U.S.A. v. Natural Resources Defense Council,

Oe a Be RS a ee eee 9

Church of Scientology of California v. United States,

mince TOO. cigicnt: A a a Pane Ses 4

Columbia Basin Land Protection Ass'n v. Schlesinger,

GES FOR FOS Ce GO. Beebe inc sivwacwsctesccs ier: >

County of Los Angeles v. Davis, 440 U.S. 625 (1979) ..... 4

Dague v. City of Burlington, 935 F.2d 1343 (2nd Cir.

| ee er re ee fren er ea 2

Gwaltney of Smithfield v. Chesapeake Bay Foundation,

Eae., SG UG Ge Gages bcs aCecnwecscvceeeiciss 4,6

Hallstrom v. Tillamook County, 493 U.S. 20 (1989)...... 2

Faopt uw. Ulam, 1246 US. GOD Cae «ooo ccecacswasevvies 8

Millis v. Green, 199 US. Gl (UG8S). ...... 52 cccccccceee: 5

United States v. Crawley, 837 F.2d 291 (7th Cir.

SOEs 6094440050 bank an pees eaten eras ux 1

Van Abbema v. Fornell, 807 F.2d 633 (7th Cir. 1986) ..... 5

Village of Oconomowoc Lake v. Dayton Hudson Corp.,

oe Fe ee Cree Ce. WS kad vecnasnwcnacbas cess 2,9

ili

TABLE OF AUTHORITIES ~ Continued

Page

STATUTES

aR PT eee e Or ree Teer eT Ctr ee cr. e 4

ES CS OTST TEES ET TTPO T Eee re 3

FEDERAL REGULATIONS

Oe Ms. Oe Rem PE WEEED Ss vo 0's ccc ccevsseucwespecns 6

ere error 6

REASONS FOR GRANTING THE WRIT

I. The Decision Of The Court Of Appeals Is Not

Merely Dicta.

The Respondents, the City of Oconomowoc and Day-

ton Hudson Corp.,! argue that the holding of the Court of

Appeals regarding the limited scope of the Clean Water

Act is merely “dicta.” To the contrary, the Seventh Circuit

knows dicta when it reads it, having expounded at length

on how to recognize dicta and why it occurs in United

States v. Crawley, 837 F.2d 291, 292-93 (7th Cir. 1988). The

decision of the Court of Appeals in this case satisfies

none of the criteria for recognizing dicta established by

the Seventh Circuit itself.

The Court of Appeals’ pronouncement on the limited

scope of the Clean Water Act was not an off-hand or ill-

considered statement of illustration, or an aside, unneces-

sary to its holding. The Court of Appeals answered the

precise question identified by the Respondents as the

question to be answered by the Court of Appeals respect-

ing the Petitioner’s Clean Water Act Claim:

(2) Does the federal Clean Water Act require a

permit for the discharge of stormwater to

groundwater?

Answered by the District Court: No.

Joint Brief of the City of Oconomowoc and Target Stores, a

Division of Dayton Hudson, “Statement of Issues,” p. 6,

Court of Appeals No. 93-3380 (December 23, 1993)

(emphasis in original).

1 The State Respondents, George Meyer and the Wisconsin

Department of Natural Resources filed a waiver of their right to

file a responsive brief. As used herein, “Respondents” refers

only to the City of Oconomowoc and Dayton Hudson Corpora-

tion.

2

The Court of Appeals was not, however, uninformed

of the “defective notice” argument now being made by

the Respondents on the basis of Hallstrom v. Tillamook

County, 493 U.S. 20, 29-31 (1989).2 Although the Respon-

dents did not identify any “defective notice” issue in

their “Statement of Issues” in the Court of Appeals, they

did brief and argue exactly the same point in the Court of

Appeals as an alternative theory for affirming the deci-

sion of the trial Court. The Court of Appeals simply

chose not to accept, rely on or even discuss the Respon-

dents’ “defective notice” argument regarding the Clean

Water Act claim. Instead, the Court of Appeals firmly and

quite unequivocally construed the Clean Water Act and

narrowly circumscribed its limits.

Perhaps, since the Respondents did not identify any

“defective notice” issue in their “Statement of Issues”

respecting the Clean Water Act, the Court of Appeals felt

they had waived the issue or did not see fit to address

issues that were not properly raised or identified by the

Respondents. Perhaps, the Court of Appeals concluded

that the decision in Dague v. City of Burlington, 935 F.2d

1343, 1351 (2nd Cir. 1991), was clearly correct, clearly

applicable, and required no further elaboration or discus-

sion. For whatever reason, the Court of Appeals’ con-

struction of the limited coverage of the Clean Water Act

was not only essential to its disposition of the Petitioner’s

Clean Water Act claim, it was the only basis for the Court

of Appeals’ decision affirming the dismissal of the Clean

Water Act claim. Village of Oconomowoc Lake v. Dayton

2 Brief of Respondents City of Oconomowoc and Target Stores, a

Division of Dayton Hudson Corporation in Opposition, pp. 9-13,

hereafter cited to as “Brief of Respondents.”

3 See, e.g., Joint Brief of the City Oconomowoc and Target Stores,

a Division of Dayton Hudson, pp. 44-45, Court of Appeals No.

93-3380 (December 23, 1993).

3

Hudson Corp., 24 F.3d 962, 964-66 (7th Cir. 1994); [App.

6a-9a]. The holding was not mere dicta, as argued by the

Respondents.

Unless ©» can reasonably conclude that the Peti-

tioner and the courts subordinate to the Seventh Circuit

Court of Appeals are free to completely disregard that

portion of the decision relating to the Clean Water Act,

the Court of Appeals’ definitive construction of the Clean

Water Act is not “dicta.” Petitioner submits that no rea-

sonable person could reach such a conclusion. Certainly,

Respondents would be the first to scream “foul” if the

Petitioner were to refile its Clean Water Act claim, even

after giving a fresh notice and waiting sixty days.* Given

the stern tenor of the Court of Appeals’ decision and the

daunting potential for being sanctioned for bringing a

similar claim, it is unlikely that any other citizen would

dare bring such a claim in the trial courts subordinate to

the United States Court of Appeals for the Seventh Cir-

cuit and then dare to argue that the Court of Appeals’

decision was merely “dicta.”

The Petitioner has not mischaracterized the question

presented by the decision of the Court of Appeals in this

case. Rather, the Respondents’ “dicta” argument is a poor

substitute for the Respondents properly raising their

defective notice theory in the Court of Appeals in the first

instance, or in this Court by the filing of a cross-petition

for a writ of certiorari in a timely fashion pursuant to

Rule 12.3. Having failed to properly raise the issue

before, the Respondents should not be allowed to raise

the issue now, through specious argument.

4 As suggested by the Court of Appeals, the Petitioner

issued and served am amended notice of its intent to institute

suit under 42 U.S.C. § 7604(a)(1) on May 20, 1994, which is why

the Petitioner is not seeking review of the Court of Appeals’

holding with respect to the Petitioner’s Clean Air Act claim.

4

II. This Case Is Not “Moot” Under Any Circumstances.

The Respondents’ mootness argument is meritless,

but troubling. At the same time that Respondents criticize

the Petitioner for fully informing the Court of the pro-

ceedings below and including documents in the appendix

to the Petition that were filed with or issued by the Court

seek to introduce new affidavits and correspondence into

the record. To make matters worse, Respondents then

mischaracterize the new “facts” established by the

recently prepared affidavits. Notwithstanding the new

material inappropriately submitted for the first time in

this Court, however, it is plain that this case is not moot.

A. Completion of Construction Does Not Preclude

the Granting of Effective Relief.

Conceding that they never received the preconstruc-

tion storm water discharge permit required by the Clean

Water Act, the Respondents first contend that their ability

to construct the Target Distribution Center faster than the

courts could adjudicate the Petitioner’s citizen suit claim

renders the case “moot” because the Respondents’ Clean

Water Act violations are now “wholly past” under

Gwaltney of Smithfield v. Chesapeake Bay Foundation, Inc.,

484 U.S. 49 (1987), which concerned the subject matter

jurisdiction of the trial court to entertain a citizen suit

under 42 U.S.C. § 1365 based on the defendant’s state of

compliance at the time the complaint was filed.

It has been well established by this Court that the

Respondents’ burden of proving mootness is a heavy one,

County of Los Angeles v. Davis, 440 U.S. 625, 631 (1979).

This Court has also pointed out that a case is only moot

when, “an event occurs while a case is pending on appeal

that makes it impossible for the court to grant ‘any effec-

tual relief whatever’ to a prevailing party.” Church of

5

Scientiology of California v. United States, ___ U.S. ___, 113

S.Ct. 447, 449 (1992), quoting Mills v. Green, 159 U.S. 651,

653 (1895). In this case it is still entirely possible for the

courts to grant the Petitioner very effective relief,

whether it be injunctive relief or civil penalties, if it

prevails on the merits of its claims.

As the Court of Appeals for the Seventh Circuit has

held in rejecting a mootness argument almost identical to

that of Respondents:

As a threshold matter, we do not agree with

Fornell’s suggestion that this court no longer

has jurisdiction because construction of the

facility has begun. . . . If plaintiffs and the

attorney general were to succeed in showing

that the permit had to be revoked or modified,

we presumably could order that the facility be

dismantled, altered or operated differently.

[citations omitted] Thus, this appeal is not moot.

Van Abbema v. Fornell, 807 F.2d 633, 636-637 (7th Cir.

1986), citing Columbia Basin Land Protection Ass’n v. Schle-

singer, 643 F.2d 585, 591 n.1 (9th Cir. 1981) and Burbank

Anti-Noise Group v. Goldschmidt, 623 F.2d 115, 116 (9th Cir.

1980), cert. denied, 450 U.S. 965 (1981). Since to this day

the Respondents have never received the storm water

permit that was necessary to authorize construction of

the Target Distribution Center, it is still possible for the

courts to grant the Petitioner any of the forms of injunc-

tive relief identified in Van Abbema.

Even if the Respondents had applied for and received

the proper permits or had otherwise been able to purge

themselves of their Clean Water Act violations after the

commencement of the action in the trial court, the poten-

tial award of civil penalties for the ongoing violations

that were occurring and have continued to occur since the

complaint was filed in this action would prevent this case

from being moot. This was precisely the holding by the

6

Fourth Circuit Court of Appeals upon the remand of this

Court’s decision in Gwaltney, supra, after the Court of

Appeals had concluded that the commencement of the

underlying suit was premised upon a good faith allega-

tion of an ongoing violation:

In our view, the penalty factor keeps the contro-

- _versy alive between plaintiffs and defendants in

a citizen suit, even though the defendant has

come into compliance and even though the ulti-

mate judicial remedy is the imposition of civil

penalties assessed for past acts of pollution.

Chesapeake Bay Foundation v. Gwaltney of Smithfield, 890

F.2d 690, 696 (4th Cir. 1989). The reasoning of the Fourth

Circuit Court of Appeals was followed and expanded

upon by the Eleventh Circuit in Atlantic States Legal Foun-

dation, Inc. v. Tyson Foods, Inc., 897 F.2d 1128, 1134-37

(11th Cir. 1990).

B. The Need For A Storm Water Operating Permit

Has Never Been Determined.

The second prong of Respondents’ mootness argu-

ment should be rejected because: (1) it is based on new

affidavits and correspondence outside of the record; (2)

the Respondents’ representations regarding a determina-

tion by the State, that no operating permit is needed, is

demonstrably false from the text of the correspondence

itself; and (3) the basis for Respondents’ new theory is

Dayton Hudson’s creative but unreasonable legal argu-

ment, that a 1.1 million square foot facility, with parking

for over 700 semi-trailers, that is devoted exclusively to

the receiving and shipping of goods via up to 444 semi-

trucks per day, and at which nothing is ever sold to

anyone, is really a retail “Department Store” rather than a

warehouse associated with transportation. See, e.g., 40

C.F.R. § 122.26(b)(14)(viii) and (xi).

7

It is fairly clear that the only people who have con-

cluded anything about Dayton Hudson’s need for an

operating storm water permit are Dayton Hudson’s law-

yers. Brief of Respondents, App. 3. In response to Dayton

Hudson’s request for a written determination that no

permit was required, a representative of the Wisconsin

Department of Natural Resources wrote on February 11,

1994:

The Department has not and cannot make individual

judgments regarding the appropriate SIC code for all

such facilities. We must rely on the facility owners to

properly identify which SIC codes apply to their

facilities. Nevertheless, presuming that the Tar-

get Midwest Distribution Center is appro-

priately classified a Industry No. 5311, we

would agree that it does not required a permit

under our draft administrative code as presently

written.

Brief of Respondents, App. 6 (emphasis added). In response

to Dayton Hudson’s lawyers’ renewed request on Sep-

tember 14, 1994,5 for a written determination of the facil-

ity’s exempt status, the same representative of the

Wisconsin Department of Natural Resources wrote back

on September 15, 1994:

. . . SIC Code No. 5311 was not added as an

industrial sector requiring stormwater permit

coverage for facility operation. Consequently,

subject to one qualification, if the Target Midwest

Distribution Center is appropriately classified under

that number, no stormwater permit need be applied

for or obtained.

Brief of Respondents, App. 10 (emphasis added).

5 The Petition for Certiorari was filed with this Court and

served upon the Respondents by regular mail on August 16,

1994.

8

Contrary to Respondents’ arguments, couched in rep-

resentations of “fact” to this Court, the “fact” appearing

from the face of the correspondence is that the Wisconsin

Department of Natural Resources refused to make any

determination on how to categorize Dayton Hudson’s

facility under the SIC codes, making any “determination”

entirely dependent on Dayton Hudson’s self-classifica-

tion. Cf. Brief of Respondents, pp. 7, 16. The fact is, the

Respondents concede that they have never applied for

and he e never received an operational storm water per-

mit.

It is entirely inappropriate for the Respondents to ask

this Court to engage in fact finding on the basis of new

affidavits and contentious arguments that are not well

founded in the record. Hopt v. Utah, 114 U.S. 488, 491-92

(1885); Adickes v. S.H. Kress and Co., 398 U.S. 144, 157-58,

n.16 (1970). Nor should the Court of Appeals’ decision in

this case evade the review it deserves based on Respon-

dents’ attempt to have this Court engage in fact finding,

on the basis of snippets of disputed deposition testimony,

when even the trial court in this case was unwilling to

make factual determinations at the very early stage at

which this case was dismissed. Decision and Order, pp. 3-4,

n.2, 6-7, n.3 [App. 15a-16a, 18a-19a]. Cf., Brief of Respon-

dents, pp. 20-21.

The question presented by the decision of the Court

of appeals is purely a legal one, and it is extremely

narrow. The issue that has been properly presented,

regarding the proper scope of the Clean Water Act,

should be reviewed by this Court. Trials and fact finding

are for trial courts.

9

III. The Pendency Of Potential Legislation Is Not

Material To The Issues In This Case.

As the Court of Appeals itself noted, negative legisla-

tive history is particularly unpersuasive in construing

statutes. Village of Oconomowoc Lake v. Dayton Hudson

Corp., 24 F.3d 962, 965 (7th Cir. 1994); [App. 8a]. Specula-

tion as to the import of legislative history “in the mak-

ing” is even less persuasive as a reason to deny the

requested writ in this case to review the decision of the

Court of appeals. Cf., Brief of Respondents, pp. 24-26. If

congress passes the legislation referred to by Respon-

dents, and thereby ratifies U.S. EPA’s authoritative inter-

pretation of the Clean Water Act, the issue presented in

this case will still remain with respect to the state of the

law at the time this action was commended. If the legisla-

tion is not passed, it is likely due to the fact that the

legislators felt it was not particularly necessary to expend

the political energy to ratify U.S. EPA’s construction of

the Clean Water Act given this Court’s decision in Chev-

ron U.S.A., Inc. v. Natural Resources Defense Council, Inc.,

467 U.S. 837 (1984). In either case, the important reasons

for granting the requested writ to review the Court of

Appeals’ decision will still remain.

Unless Congress enacts a statute, with retroactive

effect, unequivocally stating that U.S. EPA is prohibited

from regulating the “discharge of any pollutant” to

waters of the United States that occur through shallow,

hydrologically connected groundwaters, the construction

of the scope of the Clean Water Act by U.S. EPA remains

undisputed and most likely dispositive of the issue that

has been properly presented by this case, according to

this Court’s decision in Chevron. It is immaterial whether

Congress chooses to ratify U.S. EPA’s construction of the

Clean Water Act or continue to defer to U.S. EPA’s inter-

pretation. What is material is the fact that the Court of

10

Appeals did not defer to the agency’s interpretation, as it

should have done in this case.

CONCLUSION

For all of the foregoing reasons and the reasons set

forth in the Petition for a Writ of Certiorari, the Petitioner

urges this Court to issue the writ, review the Court of

Appeals’ decision, and reverse it.

Respectfully submitted,

WILLIAM S. Rousn, Jr.*

KATHERYN A. LONSDOREF

Davis & KuettHAu, S.C.

111 E. Kilbourn

Suite 1400

Milwaukee, WI 53202

(414) 276-0200

*Counsel of Record

ve ee tag’ a

MJ A a a ; 5 il ;

i wie Ct is, Bhs pie Bsa, ron, ae oe ee eS — ' .

et, ees (1a isp 1 Petar ele Soe Me: > St a) ; J tif . 8 ; a ia Lem | pia ;

| | ss es

tt

«

-

oe

-

oy ik

vA gaye R $

| ' Re F ia ar al

oe ' . ; : ie : Ss , as ost

. . Ties ay ‘ee, lar ve a

apt oe i ee oh ia is

on an 6 dew