United States: The Supreme Court Affirms Private Property Rights In A Landmark Unanimous Clean Water Act Decision

In a unanimous decision today, the Supreme Court rejected the Environmental Protection Agency's ("EPA") position that compliance orders issued under the Clean Water Act ("CWA") are not subject to judicial review under the Administrative Procedure Act ("APA") in Sackett v. EPA, No. 10-1062. Justice Alito, in a concurring opinion, probably summed up the practical implications of EPA's position in the Sackett case best when he stated: "The position taken in this case by the Federal Government—a position that the Court now squarely rejects—would have put the property rights of ordinary Americans entirely at the mercy of [EPA] employees."

In 2007, Bonner County, Idaho, residents Michael and Chantell Sackett received a compliance order from EPA informing them that, among other things, they had violated the CWA by placing dirt on their 2/3-acre vacant lot in preparation for construction of their home. EPA's compliance order asserted that the Sacketts' lot contained wetlands subject to EPA regulation under the CWA, that the Sacketts violated the CWA by discharging dirt (defined as a "pollutant" under the CWA) into a wetland, and ordered the Sacketts to restore their lot to its original condition. After EPA denied the Sacketts' request for an administrative hearing, the Sacketts sought relief from the U.S. District Court. The District Court found that the APA (which generally allows review of final agency action) does not allow for review of the Sacketts' claims, and the Ninth Circuit Court of Appeals agreed.

The Supreme Court reversed, holding that compliance orders are final agency actions subject to judicial review under the APA. However, the Court did not provide any clarity on the underlying issue—the question of what constitutes a "navigable water" for purposes of regulation under the CWA—instead urging Congress and/or the regulatory agencies to more clearly define that term.

In addition to almost certain impacts on EPA's enforcement regime under the CWA, the decision in Sackett has potential implications for other regulatory enforcement practices. "The APA's presumption of judicial review is a repudiation of the principle that efficiency of regulation conquers all." No. 10-1062 (Scalia, J.) (majority opinion).

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