Supreme Court Decision Creates Renewed Uncertainty About Wetlands Jurisdiction

June 26, 2006

On Monday, June 15, 2006, the U.S. Supreme Court handed down its much awaited judgments in the combined cases of Rapanos v. United States and Carabell v. U.S. Army Corps of Engineers.  Once again, the Supreme Court was asked to tackle the difficult question of the extent of the U.S. Army Corps of Engineers’ jurisdiction over wetlands and other so-called “waters of the United States” under Section 404 of the Clean Water Act.  Unfortunately for the regulated community, the Court once again provided little clarity to the regulators or the regulated community, and the Justices’ multiple opinions – none of which garnered a majority – are likely to engender more confusion and uncertainty in the coming months while resolving very little ambiguity in the current regulatory picture.

In the Rapanos and Carabell cases, the Supreme Court was asked again to consider how far the Corps’ jurisdiction extends in regulating wetlands, rivers, streams, and the innumerable other types of geographic features that can contain water for a little or a long time.  Specifically, the Court was asked to decide whether the term “navigable waters” as used in the Clean Water Act extends to wetlands that are neither themselves navigable nor adjacent to waters that are navigable-in-fact.  These cases, both arising out of the Sixth Circuit, reflect a larger universe of cases that arose throughout the country in the wake of the Supreme Court’s 2001 decision in Solid Waste Agency of Northern Cook County v. Army Corps of Engineers (“SWANCC”).  The question posed in the wake of the SWANCC decision was whether that decision invalidated the Corps’ regulatory authority over only a very small category of isolated waters (those regulated under the Corps’ so-called Migratory Bird Rule) or whether it signified a much more drastic rollback in Corps jurisdiction.  The answer is now in, and it appears to be a resounding “maybe.”

Much has already been made in only a few days about the strident opinion filed by Justice Scalia, and joined by the Chief Justice and Justices Thomas and Alito, announcing the judgment of the Court in Rapanos and Carabell and calling for a drastic rollback in Corps jurisdiction.  However, while the judgment announced by Justice Scalia (vacating and remanding both cases for further proceedings) commanded a 5-4 majority of the Court (including Justice Kennedy), the opinion written by Justice Scalia enjoyed the support of only four Justices, meaning that it lacks the authority of a majority opinion of the Court.  Moreover, in an equally passionate concurring opinion, Justice Kennedy supported the majority decision to vacate and remand both cases, but soundly rejected the reasoning and conclusions of the plurality led by Justice Scalia.  Consequently, in the absence of a clear majority rule, the practical outcome for anyone who must decipher the bounds of Corps jurisdiction is more uncertainty and the application of more ad hoc, case-by-case jurisdictional analyses by the Corps.

Justice Scalia’s opinion is music for the ears of many in the regulated community who have argued for years that the Corps has stretched its jurisdiction under the Clean Water Act far beyond the bounds of reason, statutory intent, and Constitutional authority.  In what would be a dramatic rollback of Corps jurisdiction, Justice Scalia  argues that jurisdiction should extend only to waters that are “relatively permanent, standing or flowing bodies of water” – a category that would include seasonal rivers, but would exclude intermittent and ephemeral streams.  Justice Scalia’s opinion would further limit the Corps’ jurisdiction with respect to wetlands to those that bear “a continuous connection to bodies that are ‘waters of the United States’ in their own right,” i.e., that meet the test for “relatively permanent, standing or flowing bodies of water.”  Thus, wetlands, such as those at issue in Rapanos and Carabell, that bear a much more tenuous and distant relation to navigable-in-fact waters, would likely fall outside Corps jurisdiction.  This approach would truly constitute a sea change in the interpretation of Corps jurisdiction under the Clean Water Act.  However, as noted previously, Justice Scalia’s opinion failed to garner five votes, and thus is of only limited import.

As noted by the Chief Justice in a brief concurrence, the fact that no opinion commanded a majority in these cases means that the rule articulated in Grutter v. Bollinger, 539 U.S. 306 (2003), and Marks v. United States, 430 U.S. 188 (1977), will apply here.  Namely, where no opinion enjoys the support of a majority of the Justices, “the holding of the Court may be viewed as that position taken by those Members who concurred in the judgments on the narrowest grounds.”  Marks, 403 U.S.at 193.  In this case, this means that the holding of the Court must be discerned from an analysis of the narrow grounds upon which Justice Kennedy concurred with the remainder of the majority.  It is not that Justice Kennedy’s opinion, by default, simply carries the day, but rather, the Court’s holding can be found (if at all) in the narrowest grounds on which all five Justices agreed.  Discerning those grounds will likely be the test and challenge of the next several months (and possibly years).

Despite the lack of overall clarity, a few conclusions can be made regarding Justice Kennedy’s opinion.  First, Justice Kennedy clearly rejected the sweeping scope of Justice Scalia’s plurality opinion, stating that the two limitations identified in that opinion “are without support in the language and purposes of the [Clean Water Act] or in our cases interpreting it.”  Similarly, Justice Kennedy rejected the sweeping position taken by the dissent (led by Justice Stevensand arguing for an extremely expansive view of Corps jurisdiction), whose opinion he found would read the word “navigable” out of “navigable waters” in the Clean Water Act.  Thus, seeking to strike a middle course, Justice Kennedy looked to the Court’s prior opinion in SWANCC and found that prior Court’s requirement for a “significant nexus” between regulated wetlands and navigable-in-fact waters to be the correct test.  Specifically, Justice Kennedy wrote that “the Corps’ jurisdiction over wetlands depends upon the existence of a significant nexus between the wetlands in question and navigable waters in the traditional sense.  The required nexus must be assessed in terms of the statute’s goals and purposes.”  The practical effect of this approach is to continue the case-by-case approach currently followed by the Corps, though with some additional limitations (noted below).

While the full implications of these split opinions will be debated for years, a few implications seem relatively clear.  For example, while Justice Scalia would have eliminated Corps jurisdiction over all intermittent and ephemeral streams, Justice Kennedy seems to have clearly rejected this course.  In an extended argument, Justice Kennedy writes that the plurality’s emphasis on the permanence of the regulated waters is misplaced, concluding that “[i]t follows that the Corps can reasonably interpret the Act to cover the paths of . . . impermanent streams,” such as intermittent streams.  Thus, for the time being, it appears that the Supreme Court has not excluded intermittent streams from Corps jurisdiction.  The status of ephemeral streams is even more murky and clearly unsettled as a result of Justice Kennedy’s concurrence.

Justice Kennedy also clearly rejected the plurality’s insistence on a “continuous connection” between a wetland and a “permanent” navigable water in order for the Corps to assert jurisdiction over the wetland.  This position, as with most of Justice Kennedy’s opinion, is grounded in a broader conception of Congressional intent behind the Clean Water Act – namely, to protect the biological and chemical integrity of waters of the United States, not just their physical integrity.  Thus, Justice Kennedy states that “[i]mportant public interests are served by the Clean Water Act in general and by the protection of wetlands in particular.”  He criticizes the plurality opinion as giving insufficient deference to Congress’ purposes in enacting the Clean Water Act and to the authority of the Executive Branch to implement that statutory mandate.

Justice Kennedy’s concurrence in the judgment of the Court to vacate and remand both cases – to allow for further proceedings to determine whether the wetlands in question had a significant nexus with navigable-in-fact waters – along with his refusal to join the opinion of the plurality leaves regulation in this arena subject to a continued case-by-case approach.  Clearly, Justice Kennedy agreed with the plurality that the Corps has overreached in some cases, and that the facts in the record of Rapanos and Carabell were insufficient to conclude whether jurisdiction existed in those cases.  Nevertheless, Justice Kennedy clearly would find the required “significant nexus” in, among other things, a strong connection to water quality and other chemical and biological considerations.  The plurality led by Justice Scalia likely would not find such a broad, attenuated nexus sufficient, looking more toward the traditional navigational concerns in which the plurality opinion is largely based.  Thus, the rule for the Corps and the regulated community to follow is far from clear.  Considerable additional litigation is likely to ensue, with a likely return to the Supreme Court, before any greater clarity can be found.  In the meantime, careful evaluation of each permitting situation will be required on a case-by-case basis to determine where each situation falls in relation to the cloudy rules set down by the Supreme Court this month.

For more information on this topic or other questions about the Corps of Engineers' permitting program under Section 404 of the Clean Water Act, contact Tim Hagerty at (502) 568-0268 or thagerty@fbtlaw.com.

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