Seventh Circuit Holds Federal Agencies Can Be Sued For Public Nuisance, But Affirms Dismissal Of Claim

On July 14, 2014, the Seventh Circuit decided Michigan et al. v. U.S. Army Corps of Engineers et al. (Wood, C.J., writing for a unanimous panel). While the court ultimately affirmed dismissal of the underlying action, the opinion's holding concerning federal-agency liability for the federal common-law tort of public nuisance deserves notice. It may support future litigation on such a theory of liability across a broad range of environmental issues.

In Michigan, five states and a native tribe sued federal and state government entities under the Administrative Procedure Act ("APA") and the federal common law of public nuisance. The plaintiffs alleged that two invasive species of Asian carp, introduced to southern fish farms in the 1970s to control plant growth, have migrated so far up the Mississippi River system that they now threaten to invade the Great Lakes. The defendants are jointly responsible for controlling the Chicago Area Waterway System ("CAWS"), part of a series of canals and channels that connect the lakes to the river. Plaintiffs requested preliminary and permanent injunctive relief directing the defendants to effect "hydrological separation" between the river and the Lakes. (There is evidence that the carp have already reached CAWS, and may be as little as six miles from reaching Lake Michigan.)

On an earlier appeal, the Circuit had affirmed the district court's denial of preliminary relief, holding it unlikely that the requested injunction would meaningfully lower the risk that the carp would reach the lakes before a ruling on the merits. 667 F.3d 765. On that first appeal, the Circuit held that the suit fell within the APA's waiver of federal sovereign immunity, but did not decide whether a federal common-law nuisance claim can be stated against the federal government. Following that appeal, the district court dismissed the complaint for failure to state a claim, holding that "maintenance of the hydrologic connection" between the river and the lakes is lawful, authorized, and indeed required by the federal Rivers and Harbors Act.

On the second, instant appeal, the Circuit reached the question it had not decided before: whether federal agencies are liable to federal common-law nuisance claims. Rejecting the position that federal government action is by definition in the public interest, the court distinguished between, on the one hand, "[a]ctivities commanded or authorized by statute" and "agency rules promulgated pursuant to...