Trout Unlimited v. Pirzadeh

• Decision Date: 17 June 2021
• Docket Number: No. 20-35504,20-35504
• Citation: 1 F.4th 738
• Parties: TROUT UNLIMITED, Plaintiff-Appellant, and Bristol Bay Economic Development Corporation; Bristol Bay Native Association, Inc.; United Tribes of Bristol Bay; Bristol Bay Regional Seafood Development Association, Inc. ; Bristol Bay Reserve Association; SalmonState ; Alaska Center; Alaska Community Action on Toxics ; Alaska Wilderness League; Cook Inletkeeper; Defenders of Wildlife; Earthworks; Friends of McNeil River ; National Parks Conservation Association ; National Wildlife Federation ; Natural Resources Defense Council; Sierra Club; Wild Salmon Center; McNeil River Alliance, Plaintiffs, v. Michelle PIRZADEH, in her official capacity as Acting Regional Administrator of the U.S. Environmental Protection Agency, Region 10; Melissa Hoffer, in her official capacity as Acting General Counsel for EPA and delegated authority of the Administrator ; U.S. Environmental Protection Agency ; Michael S. Regan, in his official capacity as Administrator, Defendants-Appellees, State of Alaska, Intervenor-Defendant-Appellee.
• Court: U.S. Court of Appeals — Ninth Circuit

1 F.4th 738

TROUT UNLIMITED, Plaintiff-Appellant,

and

Bristol Bay Economic Development Corporation; Bristol Bay Native Association, Inc.; United Tribes of Bristol Bay; Bristol Bay Regional Seafood Development Association, Inc. ; Bristol Bay Reserve Association; SalmonState ; Alaska Center; Alaska Community Action on Toxics ; Alaska Wilderness League; Cook Inletkeeper; Defenders of Wildlife; Earthworks; Friends of McNeil River ; National Parks Conservation Association ; National Wildlife Federation ; Natural Resources Defense Council; Sierra Club; Wild Salmon Center; McNeil River Alliance, Plaintiffs,

v.Michelle PIRZADEH, in her official capacity as Acting Regional Administrator of the U.S. Environmental Protection Agency, Region 10; Melissa Hoffer, in her official capacity as Acting General Counsel for EPA and delegated authority of the Administrator ; U.S. Environmental Protection Agency ; Michael S. Regan, in his official capacity as Administrator,^* Defendants-Appellees,State of Alaska, Intervenor-Defendant-Appellee.

No. 20-35504

United States Court of Appeals, Ninth Circuit.

Argued and Submitted August 12, 2020 San Francisco, California

Filed June 17, 2021

Paul A. Werner III (argued), Steven P. Hollman, Abraham J. Shanedling, and Kirsten O. Ryan, Sheppard Mullin Richter & Hampton LLP, Washington, D.C., for Plaintiffs-Appellant.

Anna T. Katselas (argued), Michael T. Gray, and Mark A. Nitczynski, Attorneys; Eric Grant, Deputy Assistant Attorney General; Environment and Natural Resources Division, United States Department of Justice, Washington, D.C.; Carrie Wehling and Heidi Nalven, Attorneys, United States Environmental Protection Agency, Washington, D.C.; for Defendants-Appellees.

Before: Susan P. Graber and Daniel A. Bress, Circuit Judges, and Robert T. Dawson,^** District Judge.

Dissent by Judge Bress

GRABER, Circuit Judge:

The Bristol Bay watershed in southwestern Alaska contains considerable ecological and commercial resources. One of the greatest wild salmon fisheries in the world, Bristol Bay supports a diverse ecosystem, commercial fishing operations, recreational fishing, and a subsistence way of life for many tribal communities. The watershed also holds rich mineral stores, attracting the attention of mining companies. Competing interests have generated significant controversy over the best uses of the watershed, but this appeal stands apart from that debate; we decide only a single legal issue concerning the reviewability of an agency's decision under the Administrative Procedure Act ("APA").

In 2014, the Environmental Protection Agency ("EPA") formally proposed to exercise its authority under § 404(c) of the Clean Water Act to restrict the ability of miners to operate in part of the watershed. Five years later, after conducting nine public hearings and after receiving nearly two million public comments, the EPA withdrew its proposed determination by publishing an explanation in the Federal Register as its final agency action. Plaintiff Trout Unlimited then filed this action against Defendants EPA and several EPA officials in their official capacities, challenging the withdrawal of the EPA's proposed determination as a violation of both the Clean Water Act and the implementing regulations.

Courts ordinarily may review final agency actions, but Defendants moved to dismiss on the ground that the EPA's withdrawal fell within an exception to reviewability for agency actions "committed to agency discretion by law," 5 U.S.C. § 701(a)(2). The district court agreed with Defendants, holding that the EPA's decision was unreviewable pursuant to 5 U.S.C. § 701(a)(2) and Heckler v. Chaney , 470 U.S. 821, 105 S.Ct. 1649, 84 L.Ed.2d 714 (1985). In the district court's view, neither the Clean Water Act nor the EPA's regulations include a meaningful legal standard governing the EPA's decision.

Reviewing de novo, City and County of San Francisco v. U.S. Dept. of Transp. , 796 F.3d 993, 998 (9th Cir. 2015), we hold that (a) the Clean Water Act contains no meaningful legal standard in its broad grant of discretion to the EPA but that (b) the EPA's regulations do contain a meaningful legal standard. In particular, 40 C.F.R. § 231.5(a) allows the EPA to withdraw a proposed determination only when an "unacceptable adverse effect" on specified resources is not "likely." Accordingly, we affirm in part and reverse in part the dismissal. We remand for further proceedings to determine whether the EPA's withdrawal was arbitrary, capricious, an abuse of discretion, or contrary to law, 5 U.S.C. § 706(2)(A). We express no view on that question.

BACKGROUND

A. Section 404(c) of the Clean Water Act

The Clean Water Act generally prohibits the discharge of dredged and fill materials into the waters of the United States without a permit. 33 U.S.C. §§ 1311(a), 1344(a). Section 404 of the Act governs "[p]ermits for dredged or fill material" and assigns varying responsibilities to two agencies: the U.S. Army Corps of Engineers and the EPA. Id. § 1344. Generally speaking, the Corps administers the § 404 permitting program,¹ and the EPA uses its environmental expertise to shape the contours of the program. See, e.g. , 44 Fed. Reg. 58076, 58081 (Oct. 9, 1979) ("While Congress had faith in the Corps’ administrative experience, it recognized EPA as the ‘environmental conscience’ of the Clean Water Act.").

Section 404(a) provides that the Corps "may issue permits ... for the discharge of dredged or fill material into the navigable waters at specified disposal sites." Id. § 1344(a). Section 404(b), titled "[s]pecification for disposal sites," requires the Corps to "specif[y]" "each such disposal site ... for each such permit." Id. § 1344(b). But the Corps’ § 404(b) authority to specify disposal sites is expressly "[s]ubject to subsection (c) of this section." Id. In turn, § 404(c) provides in full:

The Administrator [of the EPA] is authorized to prohibit the specification (including the withdrawal of specification) of any defined area as a disposal site, and he is authorized to deny or restrict the use of any defined area for specification (including the withdrawal of specification) as a disposal site, whenever he determines, after notice and opportunity for public hearings, that the discharge of such materials into such area will have an unacceptable adverse effect on municipal water supplies, shellfish beds and fishery areas (including spawning and breeding areas), wildlife, or recreational areas. Before making such determination, the Administrator shall consult with the Secretary [of the Army]. The Administrator shall set forth in writing and make public his findings and his reasons for making any determination under this subsection.

Id. § 1344(c).

Section 404(c) thus "authorize[s]" the Administrator of the EPA to take action "whenever he determines" that the discharge of dredged or fill material "will have an unacceptable adverse effect" on environmental resources. Id. ; see 40 C.F.R. § 231.2(e) (defining "unacceptable adverse effect" to encompass "significant degradation of municipal water supplies ... or significant loss of or damage to" other resources). The Administrator may declare an area off-limits entirely for a § 404 permit ("prohibit the specification"); or, less drastically, he may "restrict the use" of an area, thus limiting the scope of any allowable § 404 permit. Id. ; 40 C.F.R. § 231.2(b) – (c) ; see 44 Fed. Reg. at 58076 (stating that the EPA could restrict the use of an area by, for example, prohibiting a particular dredged or fill material). The EPA has interpreted the statutory text to allow it to act at any time: before a permit application has been filed, while a permit application is pending, or even after the Corps has issued a permit. 44 Fed. Reg. at 58076; 40 C.F.R. § 231.2(a) – (c) ; see also Mingo Logan Coal Co. v. U.S. EPA , 714 F.3d 608, 612–16 & n.3 (D.C. Cir. 2013) (holding that the statute's use of the phrases "whenever" and "including the withdrawal of specification" evince Congress’ intent to allow the EPA to use its § 404(c) authority after a permit issues). The EPA and others have referred to the § 404(c) authority as a "veto." E.g. , 44 Fed. Reg. at 58076, 58081; Mingo Logan , 714 F.3d at 613.

The statute requires "notice and opportunity for public hearings," and it requires the Administrator to issue a public, written explanation for any § 404(c) determination. 33 U.S.C. § 1344(c). But the statute is silent on the mechanics and details of those requirements.

B. Implementing Regulations

In 1979, the EPA promulgated extensive regulations that govern the exercise of its § 404(c) authority. 40 C.F.R. §§ 231.1 – 231.8. Because the regulations are important to this appeal, we describe them in some detail.

The § 404(c) process starts with a "proposed determination" by a Regional Administrator. Id. § 231.1(b)(1). "If the Regional Administrator has reason to believe ... that an ‘unacceptable adverse effect’ could result from the specification or use for specification of a defined area for the disposal of dredged or fill material, he may initiate the following actions ...." Id. § 231.3(a). The Regional Administrator first may notify the Corps’ District Engineer, the owner of the site, and any permit applicant of the Regional Administrator's intent to issue public notice of "a proposed determination to prohibit or withdraw the specification, or to deny, restrict or withdraw the use for specification ... of any defined area as a disposal site." Id. § 231.3(a)(1). If the recipients persuade the Regional Administrator that no adverse effect will result, then the process ends. Id. § 231.3(a)(1)–(2). But if the recipients do not "demonstrate[ ] to the satisfaction of the Regional Administrator that no unacceptable adverse effect(s) will occur ..., the Regional Administrator shall publish notice of a proposed determination in accordance with the procedures of this section." Id. § 231.3(a)(2).

"Every public notice shall contain, at a...