Nat'l Ass'n of Home Builders v. U.S. E.P.A.

• Citation: 731 F.Supp.2d 50
• Decision Date: 18 August 2010
• Docket Number: Civil Action No. 09-0548 (RMU)
• Parties: NATIONAL ASSOCIATION OF HOME BUILDERS, et al., Plaintiffs, v. UNITED STATES ENVIRONMENTAL PROTECTION AGENCY, et al., Defendants.
• Court: U.S. District Court — District of Columbia

731 F.Supp.2d 50

NATIONAL ASSOCIATION OF HOME BUILDERS, et al., Plaintiffs,

v.UNITED STATES ENVIRONMENTAL PROTECTION AGENCY, et al., Defendants.

Civil Action No. 09-0548 (RMU).

United States District Court, District of Columbia.

Aug. 18, 2010.

Duane Joseph Desiderio, National Association of Home Builders, Washington, DC, Jaron J. Bromm, Fennemore Craig, P.C., Denver, CO, Norman D. James, Fennemore Craig, Phoenix, AZ, for Plaintiffs.

Andrew J. Doyle, Department of Justice, Washington, DC, for Defendants.

MEMORANDUM OPINION

Granting the Defendants' Motion to Dismiss

RICARDO M. URBINA, District Judge.

I. INTRODUCTION

This matter comes before the court on the motion to dismiss filed by defendants the Environmental Protection Agency ("the EPA") and the Army Corps of Engineers ("the Corps").¹ The plaintiffs, trade associations representing businesses in the housing and construction fields, seek judicial review under the Administrative Procedure Act ("APA"), 5 U.S.C. §§ 701 et seq., of the defendants' designation of two reaches of the Santa Cruz River in Arizona as "traditional navigable waters" ("TNWs") under the Clean Water Act ("CWA"), 33 U.S.C. §§ 1251 et seq. The defendants move to dismiss for lack of subject matter jurisdiction. As discussed in detail infra Part III.B, because the court determines that the CWA precludes judicial review of the agency determinations at this time, the court grants the defendants' motion to dismiss.²

II. BACKGROUND

A. Statutory Framework

The CWA was promulgated "to restore and maintain the chemical, physical, and biological integrity of the Nation's waters." 33 U.S.C. § 1251(a). The EPA and the Corps share regulatory authority to administer and enforce the CWA. See, e.g., 33 U.S.C. § 1251(d) (providing that, unless otherwise indicated, the EPA's Administrator "shall administer this chapter"); id. § 1344(d), (a) (authorizing the Secretary of the Army, "acting through the Chief of Engineers," to make permitting decisions for the discharge of dredged or fill material into "the navigable waters"). If a property owner is unsure if his or her land contains waters regulated under the CWA, he or she can request a jurisdictional determination ("JD") from the Corps. U.S. Army Corps of Eng'rs, Regulatory Guidance Letter No. 08-02 at 1 (June 26, 2008). An "approved" JD is the Corps' declaration that waters either do or do not fall within federal jurisdiction under the CWA; approved JDs are subject to administrative review. 33 C.F.R. § 331.2. Regulatory jurisdiction under the CWA derives from Congress's commerce power, see Rapanos v. United States, 547 U.S. 715, 724, 126 S.Ct. 2208, 165 L.Ed.2d 159 (2006) (plurality opinion), and waters can fall under that jurisdiction by virtue of their connection to TNWs, see id. at 742, 126 S.Ct. 2208.

Property owners must apply for a permit to fill any waters over which the Corps and EPA have jurisdiction under the CWA. See 33 U.S.C. § 1344(a). Unsatisfied permit applicants can challenge permitting decisions in administrative proceedings, see 33 C.F.R. § 331.2, as well as in federal district court, see id. § 331.12; Rapanos, 547 U.S. at 730, 126 S.Ct. 2208. If a property owner deposits dredged or fill material into federally regulated waters without a permit, both the EPA and the Corps have a number of tools to address the violation. The EPA can issue a compliance order, see 33 U.S.C. § 1319(a)(3), or the Corps can issue a cease-and-desist order, see 33 C.F.R. § 326.3(c)(1). Alternatively, either the EPA or the Corps can assess administrative penalties. See 33 U.S.C. § 1319(g); 33 C.F.R. § 326.6. The assessment of administrative penalties is subject to judicial review. 33 U.S.C. § 1319(g)(8); 33 C.F.R. § 326.6( l ). Finally, both the EPA and the Corps possess authority to initiate enforcement actions in federal district court seeking injunctive relief and monetary penalties. See 33 U.S.C. § 1319(b); 33 C.F.R. § 326.5.

B. Factual & Procedural History

On December 3, 2008, the EPA's Assistant Administrator for Water issued a letter to the Assistant Secretary of the Army for Civil Works, stating that two reaches of the Santa Cruz River were TNWs. Compl. ¶ 3 & Ex. 1 ("EPA TNW Determination") at 1. In this letter, the EPA affirmed earlier determinations made by the Corps' Los Angeles District that the two reaches qualified as TNWs. ³ Compl. ¶ 4; EPA TNW Determination at 1.

The plaintiffs commenced this action on March 23, 2009, see generally Compl., alleging that the EPA and the Corps violated the APA's procedural requirements indetermining that the reaches were TNWs, id. ¶¶ 58-66. More specifically, the plaintiffs claim that the TNW determinations were either administrative rules, in which case the agencies failed to abide by the APA's rulemaking procedures, or adjudications, in which case the agencies failed to follow the adjudicatory procedures outlined in the APA. Id. The plaintiffs also contend that the TNW determinations were arbitrary and capricious, were unsupported by sufficient evidence and exceeded the agencies' statutory authority. Id. ¶¶ 67-79.

The defendants previously filed a motion to transfer this case to the District of Arizona pursuant to 28 U.S.C. § 1404(a), see generally Defs.' Mot. to Transfer, which this court denied, see generally Mem. Op. (Dec. 30, 2009). The defendants then filed this motion to dismiss for lack of subject matter jurisdiction pursuant to Federal Rule of Civil Procedure 12(b)(1). See generally Defs.' Mot. As the motion is now ripe for adjudication, the court turns to the applicable legal standard and the parties' arguments.

III. ANALYSIS

A. Legal Standard for a Motion to Dismiss for Lack of Subject Matter Jurisdiction

Federal courts are courts of limited jurisdiction and the law presumes that "a cause lies outside this limited jurisdiction." Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377, 114 S.Ct. 1673, 128 L.Ed.2d 391 (1994); see also Gen. Motors Corp. v. Envtl. Prot. Agency, 363 F.3d 442, 448 (D.C.Cir.2004) (noting that "[a]s a court of limited jurisdiction, we begin, and end, with an examination of our jurisdiction").

Because "subject-matter jurisdiction is an 'Art[icle] III as well as a statutory requirement[,] no action of the parties can confer subject-matter jurisdiction upon a federal court.' " Akinseye v. District of Columbia, 339 F.3d 970, 971 (D.C.Cir.2003) (quoting Ins. Corp. of Ir., Ltd. v. Compagnie des Bauxites de Guinee, 456 U.S. 694, 702, 102 S.Ct. 2099, 72 L.Ed.2d 492 (1982)). On a motion to dismiss for lack of subject matter jurisdiction pursuant to Rule 12(b)(1), the plaintiff bears the burden of establishing by a preponderance of the evidence that the court has subject matter jurisdiction. Lujan v. Defenders of Wildlife, 504 U.S. 555, 561, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992).

Because subject matter jurisdiction focuses on the court's power to hear the claim, however, the court must give the plaintiff's factual allegations closer scrutiny when resolving a Rule 12(b)(1) motion than would be required for a Rule 12(b)(6) motion for failure to state a claim. See Macharia v. United States, 334 F.3d 61, 64, 69 (D.C.Cir.2003); Grand Lodge of Fraternal Order of Police v. Ashcroft, 185 F.Supp.2d 9, 13 (D.D.C.2001). Thus, the court is not limited to the allegations contained in the complaint. Hohri v. United States, 782 F.2d 227, 241 (D.C.Cir.1986), vacated on other grounds, 482 U.S. 64, 107 S.Ct. 2246, 96 L.Ed.2d 51 (1987). Instead, "where necessary, the court may consider the complaint supplemented by undisputed facts evidenced in the record, or the complaint supplemented by undisputed facts plus the court's resolution of disputed facts." Herbert v. Nat'l Acad. of Scis., 974 F.2d 192, 197 (D.C.Cir.1992) (citing Williamson v. Tucker, 645 F.2d 404, 413 (5th Cir.1981)).

B. The Court Grants the Defendants' Motion to Dismiss

The defendants assert that judicial review of the challenged TNW determinations is premature. Defs.' Mot. at 14-18. More specifically, they contend that Congress intended to preclude review of agencyactions until the EPA or the Corps attempts to enforce the CWA by either assessing administrative penalties or initiating an action in district court. Id. The defendants point to cases in which courts have interpreted the CWA to preclude "pre-enforcement review" of various agency actions, including JDs and the issuance of compliance and cease-and-desist orders. Id. at 15-17. Based on these authorities, the defendants argue that when plaintiffs seek pre-enforcement review of TNW determinations, as they do in this case, review is therefore precluded by the CWA. Id. at 17-18.

The plaintiffs concede that courts have consistently interpreted the CWA to preclude pre-enforcement judicial review of compliance and cease-and-desist orders, but seek to distinguish those agency actions from the TNW determinations they now challenge. Pls.' Opp'n at 30. They argue that Congress intended to give the agencies flexibility in choosing between reviewable and non-reviewable enforcement options, but that precluding review of TNW determinations, which are not enforcement measures, would not further this purpose. Id. at 31-32. Finally, the plaintiffs contend that the defendants' argument would have the effect of "preclud[ing] judicial review of any agency decision that impacts or relates to their jurisdictional authority," and encourage the court to reject so sweeping a rule. Id. at 31.

The APA grants a cause of action to persons "suffering legal wrong because of agency action, or adversely affected or aggrieved by agency action within the meaning of a relevant statute." 5 U.S.C. § 702. But judicial review under the APA is unavailable when it is precluded by statute. Id. § 701(a)(1). In determining whether Congress intended to preclude a particular type of challenge to an agency action, a court examines a statute's express language, as well as "the structure of the statutory scheme, its objectives, its...