Energy and Environment Monitor
SUPREME COURT ASKED TO WEIGH IN ON CWA “DILIGENT PROSECUTION” BAR IN ADMINISTRATIVE ENFORCEMENT CONTEXT
February 7, 2023
By: Chris M. Hunter
The United States Supreme Court is being asked by a South Carolina farm to clarify whether the Clean Water Act’s (“CWA”) diligent prosecution bar precludes a federal enforcement action related to its alleged failure to get stormwater permits required by law whether the state enforcement agency had already begun the process of administrative enforcement.
Dakota Finance LLC, dba Arabella Farm, (the “Farm”), the defendant in the CWA citizen suit below, who filed the petition with the High Court, began clearing approximately 20 acres of land on its farm in 2017 in order to create space for events. In August 2019, the South Carolina Department of Health and Environmental Control (“DHEC”) sent the Farm a letter explaining that it was required to obtain a stormwater construction National Pollutant Discharge Elimination System (“NPDES”) permit and shortly thereafter issued the Farm an NOV, which let the Farm know about an "informal" hearing that would be held later in the month, which was "closed to the public and media."
Naturaland Trust and other environmental groups (“Plaintiffs”) sent the Farm a notice of an intent to bring a CWA citizen suit against it in November 2019. In January 2020, the Plaintiffs filed their CWA lawsuit in South Carolina federal court, seeking an injunction and civil penalties to be paid to the U.S. Treasury.
The Farm and the DHEC entered into a consent order in February 2020 that imposed a $6,000 penalty and required the Farm to obtain an NPDES permit and submit a plan to remedy its apparent wrongdoing. The Farm moved to dismiss the suit, and it was tossed by the South Carolina District Court in 2021. Plaintiffs thereafter appealed to the Fourth Circuit.
33 U.S.C. § 1365(b)(1)(B), provides that a citizen cannot bring a private action to enjoin violations of the CWA “if the [EPA] or State has commenced and is diligently prosecuting a civil or criminal action in a Court of the United States, or a State to require compliance with the standard, limitation, or order.” This is commonly referred to as the “diligent prosecution bar.” In Gwaltney of Smithfield v. Chesapeake Bay Foundation, 484 U.S. 49 (1987), the Supreme Court stated “[s]ince the great volume of enforcement actions [are intended to] be brought by the State,” citizen suits are proper only if “the Federal, State, and local agencies fail to exercise their enforcement responsibility.” Id. at 60. However, the diligent prosecution bar is qualified by 33 U.S.C. § 1319(g), which precludes citizen suits for violations with respect to which the EPA or a state “has commenced and is diligently prosecuting” an administrative penalty action under section 309(g) or state law “comparable” thereto. 33 U.S.C. § 1319(g)(6)(A).
The Fourth Circuit considered whether DHEC had commenced a comparable enforcement action prior to Plaintiffs filing suit and ruled in favor of Plaintiffs in a 2-1 decision. In deciding that DHEC’s issuance of an NOV was not comparable to a federal enforcement action, the Appeals Court noted that,
- The CWA provided certain rights to interested persons, including public notice, while the DEHC’s NOV and invitation to the Farm to attend an informal conference did not;
- The CWA provides for the imposition of penalties and injunctive relief in an enforcement action, whereas DHEC’s notice invited the Farm to a voluntary conference with no mention of penalties or sanctions that would follow if the Farm declined the invitation.
See Naturaland Tr. v. Dakota Fin. LLC, 41 F.4th 342, 349 (4th Cir. 2022).
Ultimately, the Fourth Circuit ruled that DHEC’s NOV did not trigger the commencement of a state court enforcement action sufficiently comparable to its federal counterpart. The Court did not address whether the consent order, which was consummated after the citizen suit was filed, was sufficiently comparable to the CWA’s enforcement mechanisms to moot the citizen suit, even if the diligent prosecution bar did not strictly apply at the commencement of Plaintiffs’ citizen suit.
There have been at least two cases on this issue in West Virginia: Sierra Club v. Powellton Coal Co., LLC, 662 F. Supp. 2d 514 (S.D.W. Va. 2009) and Ohio Valley Envtl. Coalition v. Lexington Coal Co., LLC, CV 3:19-0573, 2021 WL 1093631 (S.D.W. Va. Mar. 22, 2021). In those cases, the District Court for the Southern District of West Virginia held that the diligent prosecution bar did not preclude a CWA citizen suit against coal mine operators where the West Virginia Department of Environmental Protection (“WVDEP”) had already commenced an administrative enforcement action for the same violations. In making its rulings, the District Court noted that West Virginia’s surface mining act and regulations did not authorize WVDEP to unilaterally assess civil penalties; rather, administrative penalties had to be agreed to by the alleged violator. This, the District Court reasoned, made the ongoing administrative enforcement actions insufficiently comparable to a federal CWA enforcement action, which does authorize unilateral imposition of civil penalties, to trigger the diligent prosecution bar.
In its petition for certiorari to the Supreme Court, the Farm states that the Fourth Circuit has articulated a diligent prosecution standard under which citizen suits are not barred unless a state's enforcement regime "exactly follows" the Clean Water Act's administrative penalty provisions and implementing regulations. According to the Farm, the decision threatens states’ ability to administer their own CWA programs and conflicts with Congress’s intent to limit citizens’ ability to maintain their own suits where the state regulatory authority is already addressing the same issues.
The case is Naturaland Trust v. Dakota Finance LLC, case number 22-720, in the Supreme Court of the United States. Docket available at: https://www.supremecourt.gov/search.aspx?filename=/docket/docketfiles/html/public/22-720.html.