For the Supreme Court nerderati, the most exciting part of the Court’s opinion in Decker v. Northwest Environmental Defense Center (along with Georgia-Pacific West, Inc., v. Northwest Environmental Defense Center) may well be the separate writings. It is there, after all, that the Chief Justice does something wild: he uses the contraction “don’t.”
As if that weren’t exciting enough, he then goes on to pointedly note for the bar that “there is some interest in reconsidering” Bowles v. Seminole Rock & Sand Co. and Auer v. Robbins, which stand for the proposition that courts will defer to an agency’s interpretation of its own ambiguous regulation unless it is plainly erroneous or inconsistent with the regulation; and – in language that will doubtless be quoted in the cert. petitions that inevitably will be filed seeking that reconsideration – he observes that “serious questions” have been raised about the correctness of Auer, and that such issues “go[] to the heart of administrative law” and “arise as a matter of course on a regular basis.” (His opinion was joined by Justice Alito, who authored last Term’s majority opinion in Christopher v. SmithKline Beecham noting the “risk” that Auer encourages agencies to promulgate vague regulations, undercutting important interests in public notice.) And then there is Justice Scalia’s lone opinion concurring in part and dissenting in part, which expands considerably on his concurring opinion two Terms ago in Talk America, Inc. v. Michigan Bell Telephone Co. announcing that he is no longer persuaded by the rationale in Auer – although he wrote the opinion.
As tantalizing as the separate opinions are, there is a lot to say about what Decker actually decided. Let’s turn to that first.
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The Court was asked whether the Clean Water Act (“CWA”) and its implementing regulations require logging companies to obtain permits for stormwater runoff from ditches and culverts abutting logging roads; as Justice Kennedy’s opinion for the Court observed, “[t]here is evidence that this runoff can harm fish and other aquatic organisms” in streams, rivers, and lakes. But before the Court could get to that question, it first had to address two preliminary questions.
1. Jurisdiction. First, the Court agreed with the EPA and Northwest Environmental Defense Center (“NEDC”) – although not going perhaps as far as the latter asked – that NEDC’s suit was properly brought as a “citizen suit” in district court under 33 U.S.C. § 1365(a), rather than as a challenge to agency action that must be brought in the court of appeals under 33 U.S.C. § 1369(b). That conclusion turned on the wording of the EPA’s regulation, known as the “Silvicultural Rule,” which excluded from the definition of “point source” under the CWA “road construction and maintenance from which there is natural runoff.” The Court held that because “[t]he rule is ambiguous” about whether “natural runoff” included channeled runoff, the interpretation NEDC sought to enforce was “at least a permissible reading”; thus, “the instant suit is an effort not to challenge the Silvicultural Rule,” as petitioners Decker and Georgia-Pacific had argued, but a suit “to enforce [the Silvicultural Rule] under a proper interpretation.”
Because a challenge to agency action generally must be filed in the court of appeals within 120 days, the Court’s interpretation provides a route for challengers to bring suits in district court under the citizen suit provision – but only so long as the plaintiff seeks to enforce a permissible interpretation of the regulation. The potential for suits may temper agencies’ incentives to promulgate vague regulations under Auer.
2. Mootness. Second, the Court agreed with NEDC and Georgia-Pacific and disagreed with the EPA and Decker that there continued to be a live controversy despite the EPA’s last-minute promulgation of a rule amendment just days before oral argument. The Court concluded that, if the Ninth Circuit were right about petitioners’ obligations under the prior regulation, that “might be the basis for the imposition of penalties,” keeping the controversy alive.
So far, the Court’s opinion was unanimous, or at least as unanimous as it could be with Justice Breyer recused (his brother Charles had sat by designation on the Ninth Circuit panel that decided the case). Although NEDC did fairly well on the two threshold questions, as I previously indicated, it needed to “run the table” and win all the issues in the case in order to prevail. It didn’t.
3. Merits. On the merits, the Court agreed with petitioners and the EPA that the term “associated with industrial activity” in the EPA’s “Industrial Stormwater Rule” (which identifies the stormwater discharges subject to permitting) does not unambiguously “encompass outdoor timber harvesting.” (Wait – there’s indoor timber harvesting? The Court may want to add “operations” to the end of that phrase in the preliminary prints to make clear that it is contrasting logging with indoor operations like cutting boards, rather than with harvesting ornamental trees in mall atriums.) The regulation’s references “to ‘facilities,’ ‘establishments,’ ‘manufacturing,’ ‘processing,’ and an ‘industrial plant’ leave open the rational interpretation that the regulation extends only to traditional industrial buildings such as factories and associated sites, as well as other relatively fixed facilities,” not to timber-harvesting operations. Because the EPA’s interpretation of its regulation was permissible, the Court concluded it owed the Industrial Stormwater Rule deference under – you guessed it – Auer. The majority emphasized that “there is no indication that [the agency’s] current view is a change from prior practice or a post hoc justification adopted in response to litigation, and indeed, the EPA “has been consistent in its view that the types of discharges at issue here do not require” permits.
Finally, the Court emphasized states’ “extensive efforts” and “considerable expertise” regulating forest road runoff through “best management practices,” stating that the EPA could reasonably have concluded that a layer of federal permitting on top of those efforts “would be duplicative or counterproductive.” The Court emphasized the federalism implications, noting that Congress had given the EPA “express instructions” to work with the States on “developing the precise kind of best management practices Oregon has established here.”
In the end, Decker is an important win for the logging industry industry – at least for the potential fines averted (the issuance of new regulations means the opinion will not have prospective effect for permitting decisions). The EPA’s new regulations are a benefit prospectively. As I mentioned in my argument preview, Justice Scalia’s plurality opinion in Rapanos v. United States noted that the average CWA permit applicant spends “788 days and $271,596 in completing the process,” so we’re talking real money here.
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Which brings us back to Auer. On the one hand, Decker represents the most extensive challenge to Auer yet, with Justice Scalia offering the most detailed judicial exposition I have read of reasons to abandon that rule, and two other members of the Court hinting that they may share some of Justice Scalia’s concerns.
But in significant ways, Decker represents a triumph of Auer deference: seven Justices signed on to an opinion explicitly relying on Auer in the face of a challenger’s rival interpretation of a regulation that the Court acknowledged was “permissible.” It also seems significant that the Justice most known for a willingness to revisit precedent – Justice Thomas, the author of the majority opinion in Talk America – did not join any of the separate opinions. And that despite the fact Justice Scalia closed his opinion with an apparent pitch to Justice Thomas, borrowing, without citation, language from Justice Thomas’s 1992 opinion in Connecticut National Bank v. Germain, writing, “[i]t is time for us to presume (to coin a phrase) that an agency says in a rule what it means, and means in a rule what it says there.”
Decker was never an especially promising candidate for overruling Auer: as the majority opinion noted, the EPA’s interpretation of the Silvicultural Rule was a longstanding one, and the agency had not “change[d] from prior practice” or adopted a “post hoc justification . . . in response to litigation.” Perhaps future challenges will display the disadvantages of the Auer rule identified by Justices Scalia and Alito more starkly. But those seeking to have Auer overruled may have trouble winning a majority if Justice Thomas is not persuaded. And one of the likeliest defenders of Auer – Justice Breyer – will likely not be on the sidelines next time as he was on this go ‘round.
[Note: Goldstein & Russell, P.C., whose attorneys work for or contribute to this blog in various capacities, served as co-counsel to the respondent in these cases, but the author of this post is affiliated with another law firm.]
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