Sackett v. EPA: U.S. Supreme Court Unanimously Affirms Judicial Review Of EPA Clean Water Act Unilateral Compliance Orders

The U.S. Supreme Court issued a unanimous decision on March 21, 2012, in the case of Sackett v. Environmental Protection Agency et al., No. 10-1062, 2012 WL 932018, 566 U.S. ___ (Mar. 21, 2012), finding that a compliance order issued by the U.S. Environmental Protection Agency (EPA) under the federal Clean Water Act constitutes a final agency action subject to pre-enforcement judicial review under the Administrative Procedure Act (APA), 5 U.S.C. § 706(2)(A). This decision may well pave the way to what are likely to be hotly contested challenges to EPA's enforcement authority under the Clean Water Act, and other federal statutes.

The Sacketts purchased property near Priest Lake in Idaho and had begun to fill in part of the property with fill dirt in preparation for construction when they received a compliance order from the EPA stating that their property contained jurisdictional wetlands and that their construction project therefore violated the Clean Water Act. The EPA ordered the Sacketts to restore the property pursuant to an EPA-prepared work plan and provide EPA with access to their property. The Sacketts sought a hearing with EPA to challenge the contention that their property contained jurisdictional wetlands and, when that request was denied, they sought declarative and injunctive relief in the federal District Court on the grounds that the EPA's compliance order was "arbitrary and capricious" under the APA and deprived them of their due process rights under the Fifth Amendment. The District Court dismissed the case for lack of subject matter jurisdiction and the Ninth Circuit affirmed that decision on the grounds that the Clean Water Act precludes pre-enforcement judicial review of compliance orders and does not violate the right to due process.

In reversing the decision of the Ninth Circuit Court of Appeals, the U.S. Supreme Court determined that the EPA's compliance order constituted a "final agency action for which there is no other adequate remedy in a court," and for which there is a right to judicial review under the APA (5 U.S.C. § 704). For the "final agency action" component, the Court found that EPA's compliance order was final in that it imposed a legal obligation on the Sacketts to restore their property, and exposed them to potential penalties of up to $37,500 per day per violation of the Clean Water Act, and an additional per day penalty for violating EPA's compliance order. As the EPA's findings in the compliance...