The U.S. Supreme Court today heard oral argument in Sackett v. EPA, involving the availability of judicial review of EPA compliance orders. Although oral argument is an uncertain predictor of outcomes, indications from today's argument suggest the Justices will likely rule for the property owners, holding that the compliance order in the case is final and that the Administrative Procedure Act (APA) permits pre-enforcement review of it.
Chantell and Michael Sackett purchased a plot in a partially built-out subdivision near Priest Lake, Idaho, and made improvements to the land to prepare it for their home. Before they could do so, however, EPA informed the Sacketts that the property included "wetlands" subject to EPA jurisdiction and that the improvements they had made violated the Clean Water Act (CWA). EPA then issued a "compliance order" directing the Sacketts to restore the property to its natural condition and warning that they could otherwise face daily penalties of up to $32,500 (since increased to $37,500) for violating the CWA and a like sum for violating the compliance order. The Sacketts sought judicial review under the APA. The Ninth Circuit concluded that the compliance order was not final agency action subject to review, and that the absence of pre-enforcement judicial review did not violate due process.
The Sacketts sought Supreme Court review of the Ninth Circuit's holding. The Supreme Court granted certiorari on whether the Sacketts had a right to judicial review of the compliance order, and in the process ordered briefing on two distinct questions: whether the APA permitted pre-enforcement judicial review of the compliance order, and if judicial review were not available, whether the Sacketts' inability to seek pre-enforcement review violated the Due Process Clause.
During oral argument today, a majority of the Justices strongly expressed sympathy for the Sacketts and skepticism of the government's position. Despite the Court's decision to ask for briefing on the Due Process Clause, there were no significant questions regarding the constitutional issue; the questions were focused solely on aspects of the APA review issue.
Unsurprisingly, the more conservative Justices (except Justice Thomas, who ordinarily does not ask questions during argument) indicated particular skepticism of the validity of the government's conduct, calling it "outrageous" (Justice Alito) and "high-handed[]" (Justice Scalia). But other Justices suggested by their statements that a majority of the Court shared their view and that the Sacketts would prevail. Justice Breyer, who is widely regarded as an expert on administrative law (and previously taught the subject at Harvard Law School), suggested he thought the compliance order clearly was final action subject to APA review, declaring that the compliance order in this case "looks like about as final a thing as I have ever seen" and "there doesn't seem anything more for the agency to do." He said that "[m]y honest impression is that the government here . . . is fighting 75 years of practice" in arguing that pre-enforcement judicial review was not available. Justice Breyer nodded emphatically when Justice Alito commented that "most ordinary homeowners would say this kind of thing can't happen in the United States."
The vote of Justice Breyer alone would be enough, together with the votes of Chief Justice and Justices Scalia, Thomas, and Alito, for the Sacketts to prevail on the APA issue. But there were indications that the Sacketts may win a more lopsided victory. Justice Kagan said the government's position that the presumption of reviewability was inapplicable here was "very strange." The questions of Justices Sotomayor and Justice Ginsburg likewise reflected they may be open to a finding that this order was final for APA purposes.
The government made several concessions during the argument that seemed to reinforce the views of the Justices who thought the Sacketts were entitled to pre-enforcement review. First was its concession early during the argument that fines of $37,500 per day could "theoretically" be imposed both for violations of the CWA and the compliance order itself, such that the Sacketts could actually be fined $75,000 per day. The tremendous size of the fines underscored the coerciveness of the order and the lack of practical alternatives to compliance. Second was the government's acknowledgement that the Army Corps of Engineers was unlikely to issue an after-the-fact permit unless the Sacketts first satisfied the compliance order, underscoring that they had no realistic opportunity to obtain judicial review without fulfilling the compliance order. Third was the government's acknowledgement that although the compliance order invited the Sacketts to come forward with new information, it was unlikely that such discussions would change the terms of the order after the compliance order issued, which underscored the finality of the decision.
Although it seems clear that a majority of the Court is prepared to conclude that the Sacketts were entitled to pre-enforcement APA review, the question remains how broad the Court's ruling will be, and how the EPA may respond to it. Justice Scalia's exchanges with the government's counsel suggested that, if the Court rules against the EPA in this case, the agency will simply issue unreviewable "warnings" instead of compliance orders. But that is a question for another day.
The oral argument transcript is available here.
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