On January 22, 2018, the Supreme Court (Justice Sotomayor) unanimously decided an important procedural issue determining the court in which challenges to the meaning of the term “Waters of the United States” (WOTUS) may be brought. 

WOTUS is a key term impacting the scope of EPA (and Corps of Engineers) clean water regulation.  The Obama EPA and Corps of Engineers issued the definition nearly three years ago in May 2015.  The rule was widely criticized, with many, such as farmers, home builders, and developers, claiming that the rule impermissibly allowed EPA to regulate private land.  Others construed the rule as narrowing federal jurisdiction.  The Trump Administration opposed the rule, promising to repeal and replace it with a much narrower definition, although to date it has taken no formal action.  In the Supreme Court, the Trump Administration argued that any challenges to the meaning of WOTUS must be brought in a court of appeals. Monday’s decision requires that any challenge to the Obama meaning of WOTUS must be brought in the federal district court rather than in the federal court of appeals and allowed pending litigation in the district courts to continue. There had been a stay/halt on pending litigation.  Lifting the stay puts the Obama WOTUS definition back into effect and forces the Trump Administration to litigate throughout the United States wherever there is a challenge to the WOTUS definition, unless it is able to get a stay in the pending litigation.

Why it Matters
This situation is symptomatic of the problems of regulatory reform. In the absence of formal new regulations, business is left uncertain as to the rules that apply and how to apply them.  Under the Clean Water Act, the uncertainty as to the scope of the WOTUS rule affects whether a clean water permit is required and the scope of permits needed to discharge wastewater and storm water.  It also impacts whether real estate is determined to have wetlands on the land, which may impair property values, real estate sales and development of the land that may contain wetlands or not.