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In Circuit Split, the 6th Circ. Limits CWA’s Reach Over Pollutants That Travel Through Groundwater

Last week, the Sixth Circuit Court of Appeals held in two separate cases that the Clean Water Act does not extend liability to pollution that reaches navigable waters via groundwater. Kentucky Waterways All. v. Kentucky Utilities Co., No. 18-5115, 2018 WL 4559315, (6th Cir. Sept. 24, 2018); Tennessee Clean Water Network v. Tennessee Valley Auth., No. 17-6155, 2018 WL 4559103 (6th Cir. Sept. 24, 2018). Instead, the court adopted the bright line rule that for a point source discharge to be actionable under the CWA, it must “dump directly into” navigable waters. The decisions departed from the Fourth and Ninth Circuits’ rulings earlier this year, which held that a “direct hydrological connection” between a discharge and waterbody was sufficient for CWA liability. Our prior blog post on the Fourth Circuit’s decision, Upstate Forever et al. v. Kinder Morgan Energy Partners LP et al., No. 17-1640, 2018 WL 1748154 (4th Cir. April 12, 2018) can be found here.

By way of legal background, the Clean Water Act prohibits the unpermitted discharge of a pollutant to navigable waters from a “point source.” The CWA defines “point source” as a “discernable, confined, and discrete conveyance.” It is undisputed that the unpermitted discharge of pollutants from a point source directly into navigable waters, such as effluent discharged from a pipe directly into a lake, is a violation of the CWA. However, Courts have wrestled with the question of whether CWA liability extends to pollutants that are not directly discharged into navigable waters, but reach such waters through other means such as groundwater. This notion is often referred to as the “direct hydrological connection” theory.  

In both of the cases decided by the Sixth Circuit last week, environmental nonprofit groups alleged that coal ash ponds used by coal-fired power plants were leaking pollutants into nearby groundwater, which then flowed into nearby navigable waterbodies. Plaintiffs in both cases also alleged that highly-soluble subsurface terrain, known as karst, is located underneath the coal ash ponds. Plaintiffs asserted that the karst terrain allowed the contaminated groundwater to flow more quickly and in greater abundance, thereby increasing the rate of pollution into the nearby waterbodies.

In the Kentucky Utilities Co. case, the Sierra Club and Kentucky Waterways Alliance offered two theories for why pollutants from the coal ash ponds which discharged to a nearby lake via groundwater implicated the CWA. First, the environmental groups argued that the groundwater served as a point source through which the pollutants traveled and were discharged into the lake. Plaintiffs also presented a slightly modified version of this theory by asserting that conduits and tunnels which formed in the soluble karst underlying the ponds created a “discernable, confined and discrete” groundwater system. As a second, alternative position, the groups asserted the “direct hydrological connection” theory upheld by the Ninth and Fourth Circuits. Under this approach, the coal ash ponds served as the point sources while the groundwater was simply a medium through which the pollutants passed before discharging into the lake.

The Sixth Circuit rejected both theories and determined that CWA liability did not extend to the contamination at issue in the cases. Chief Judge Suhrheinrich, writing for the majority and joined by Justice Gibbons, relied on both the text of the CWA as well as the greater context of the federal regulatory scheme to support the court’s holding. First, Judge Suhrheinrich reasoned that groundwater and karst are not “discernible, confined and discrete” conveyances as necessary to be considered point sources under the CWA’s definition. Rather, the court noted that groundwater is a “diffuse medium” which seeps in all directions. And while karst may allow for faster groundwater flow, it does not differ from any other type of subsurface terrain, none of which are discernable, discrete, or confined.  

The court next determined that the plaintiffs’ hydrological connection theory was also foreclosed by the text of the CWA. The court first focused on the plaintiffs’ main argument that the relevant section of the CWA only prohibits the discharge of pollutants “to navigable waters from any point source,” and does not require that such pollutants be discharged “directly” to navigable waters. The court noted that the CWA defines “effluent limitations” – which form the applicable regulatory guidelines of the CWA – as restrictions on the amount of pollutants that may be “discharged from point sources into navigable waters.” The term “into”, the court reasoned, indicates “directness” and refers to a point of entry. Thus, the court found that for a point source to discharge “into” navigable waters, it must “dump directly into those navigable waters – the phrase ‘into’ leaves no room for intermediary mediums to carry the pollutants.”

Judge Suhrheinrich also addressed the plaintiffs’ reliance on the 2006 U.S. Supreme Court case, Rapanos v. United States, 547 U.S. 715 (2006). Proponents of the hydrological connection theory often point to the Supreme Court’s language in Rapanos that “the CWA does not forbid the addition of any pollutant directly to navigable waters from any point source, but rather the addition of any pollutant to navigable waters.” Justice Suhrheinrich pointed out that not only was Rapanos not binding because it was a plurality opinion, but that the Rapanos opinion answered an entirely different legal question. In Rapanos, Justice Scalia noted the absence of the word “directly” to explain that pollutants which travel through multiple point sources are still covered by the CWA. Thus, Rapanos did not address whether CWA liability extended to pollutants that traveled through non-point sources before discharging into navigable waters.

The court further reasoned that its reading of the CWA comported with other provisions of the CWA as well as corresponding federal environmental laws. The court noted that while one purpose of the CWA is to protect navigable waters, the law also expressly provides that it was designed to protect the “primary responsibilities and rights of the States” to prevent pollution. For example, the CWA authorizes the states to administer the permitting program for point source discharges and to regulate all non-point source pollution. Congress therefore intended for the CWA to apply only to point sources discharging directly into navigable waters, while the states regulated all other non-point discharges.

Finally, the court explained that the Resource Conservation and Recovery Act (“RCRA”), a federal law designed to regulate solid waste, is designed to work in tandem with the CWA, and that expansion of the CWA would impermissibly erode RCRA. RCRA explicitly exempts from its coverage any pollution that is subject to CWA regulation, thus making the two statutes mutually exclusive. Notably, the U.S. Environmental Protection Agency issued, pursuant to RCRA, a specific rule to address coal ash storage and treatment – the “coal combustion residuals,” or “CCRs” rule. The court thus reasoned that reading the CWA to cover coal ash ponds would effectively “gut” the CCRs rule issued under RCRA.

In a lengthy dissent in support of the hydrological connection theory, Justice Clay claimed that the majority’s opinion was “way off the rails.” Judge Clay first noted that the court’s decision provided a “gaping” loophole in CWA liability. Under the majority’s theory, polluters could simply move their drainage pipes several feet from the riverbank and discharge onto the ground, even if the pollutants then entered groundwater and flowed immediately into the adjacent waterbody. In Judge Clay’s view, whenever a plaintiff alleged that a defendant was polluting navigable waters through a complex pathway, the court should simply require the plaintiff to prove that pollutants in that waterbody came from the defendant’s point source.

The dissent also rebutted each of the majority’s textual and contextual arguments in turn. It first claimed that the majority’s reliance on the definition of “effluent limitation”, which contains the “into” language, is misplaced. The dissent noted that the citizen-suit provision of the CWA, under which plaintiffs brought their claims, uses the term “effluent standard or limitation,” which refers to another CWA section defining “discharge of a pollutant” as “any addition of any pollutant to navigable waters from any point source.” Thus, the word “into” is not contained in any of the statutory provisions at issue.

Next, the dissent found that the majority failed to meaningfully distinguish Rapanos because the issue was the same – whether the CWA applied to pollution that travels from a point source to navigable waters through a complex pathway. Indeed, the dissent noted that in Rapanos, Justice Scalia favorably cited to a case in which pollutants traveled across fields – which were “not necessarily point sources themselves” – before reaching navigable waters. Finally, the dissent rejected the majority’s argument that the CCR rule promulgated pursuant to RCRA would be effectively nullified by the extension of CWA liability to the storage and treatment of coal ash. The dissent noted that EPA’s own position regarding the issue, as articulated in the Federal Register, is that the RCRA would regulate the way CCR is stored while the CWA would kick in as soon as CCR enters a navigable waterway.

The Sixth Circuit’s holding in the two decisions makes it more likely that the U.S. Supreme Court will weigh in on whether CWA liability extends to discharges from point sources that reach navigable waters through groundwater. And as noted in our prior blog on the Fourth Circuit’s decision in Upstate Forever, the growing body of caselaw addressing statutory violations is not limited to the federal courts. As we also reported on earlier this year, the Pennsylvania Supreme Court ’s decision in EQT Prod. Co. v. Dep’t of Envtl. Prot. held that the Pennsylvania Clean Streams Law did not authorize the Department of Environment Protection to impose daily penalties for the ongoing, continuing presence of pollutants in waters of the Commonwealth. No. 6 MAP 2017, 2018 WL 1516385, (Pa. Mar. 28, 2018). As states and environmental groups take more of a lead in enforcement of environmental laws, cases that push at the boundaries of statutory interpretation are certain to be more common in both the federal and state arenas.