Supreme Court Unanimously Holds That Clean Water Act Compliance Orders Are Subject To Immediate Review

On March 21, 2012, the United States Supreme Court reversed the Ninth Circuit in a much anticipated decision that will likely impact the Environmental Protection Agency's (EPA) broad use of compliance orders to enforce environmental laws. The issue in Sackett v. Environmental Protection Agency, No. 10-1062, 2012 WL 932018 (U.S. Mar. 21, 2012), was whether the Clean Water Act (CWA) bars judicial review of compliance orders before the EPA brings a civil enforcement action, and whether such pre-enforcement review would violate constitutionally protected due process rights. In a unanimous decision, the Court held that regulated parties may seek immediate review of such compliance orders in federal court through claims brought under the Administrative Procedure Act (APA). The decision shifts the balance of power somewhat away from the EPA by giving regulated parties the ability to fight back with an immediate legal challenge.

When the EPA identifies what it believes to be a violation of the CWA, it has the option to press for voluntary compliance by issuing orders rather than initiating a civil enforcement action. Historically, the effect of compliance orders is that regulated parties act quickly to address the EPA's concerns because non-compliance is subject to hefty penalties that accrue daily for the duration of the alleged violation and the orders could only be challenged when EPA initiated an enforcement action. Simply put, the EPA motivates regulated parties into action by subjecting them to the risk of substantial penalties that might outweigh the cost of compliance with the EPA's unilateral order.

In 2007, when the Sacketts began to build a home on their property of less than an acre in Idaho, the EPA issued a compliance order for alleged filling of wetlands in violation of the CWA. The order imposed fines potentially as high as $75,000 for non-compliance per day and directed them to implement a mitigation plan. The Sacketts contend that their property had no wetlands subject to regulation by the CWA. The EPA denied the Sacketts' request for a hearing and the lower federal courts rejected their subsequent efforts to obtain judicial review under the APA, adopting the Government's position that the CWA "preclude[s] pre-enforcement judicial review of compliance orders." Consequently, the Sacketts found themselves at the mercy of the EPA with no viable legal recourse.

Consequences of the Supreme Court Decision

The holding in Sackett is...