UPDATE: On April 6, 2023, in an expected move, President Biden vetoed the Congressional Review Act joint-resolution that attempted to undo his administration’s WOTUS rule. The president maintained his administration’s rule “provides clear rules of the road” and emphasized that repealing the rule would have led to “increased uncertainty… [that] would threaten economic growth.” The three legal challenges discussed in this alert (playing out in the federal courts of Texas, Kentucky, and North Dakota) remain ongoing.

UPDATE: On March 31, 2023, the U.S. District Court for the Eastern District of Kentucky denied plaintiffs’ motions for preliminary injunction in another challenge to the Biden Administration’s WOTUS rule, this one brought by the state of Kentucky and “various business groups.” (The case is Kentucky v. EPA, Case No. 3:23-cv-0007-GFVT). The court explained that the plaintiffs cannot meet the high standard for blocking the rule while their lawsuit proceeds, because they cannot demonstrate how they are currently being harmed by the rule. The court further explained that the case itself is not ‘ripe’ for judicial review, because until the government enforces the rule’s application, all harms inflicted by the rule remain hypothetical. By dismissing the motions without prejudice, the court has left the door open for future attempts to enjoin the rule, once plaintiffs can establish injury in fact.

The outcome in this case underscores a markedly different legal interpretation than the one offered by the U.S. District Court for the Southern District of Texas in Texas v. EPA (discussed at length below). In Texas, the court found that the state-plaintiffs had standing, because states are entitled to “special solicitude” and do not have to meet all of the normal standards to establish standing. The court also found that the state of Texas had quantified with sufficient certainty the financial costs it would incur if it were forced to adopt the new WOTUS rule. Notably, both courts agreed that the private industry groups could not prove injury and therefore lacked standing. The court in Texas did not discuss the ripeness doctrine.

As the situation currently stands, the law remains in effect throughout the nation, except for in the states of Texas and Idaho. There is another motion for injunction filed by more than twenty states, which is pending before the District Court of North Dakota. Additionally, Congress has invoked the Congressional Review Act in an attempt to strike down the new WOTUS rule, and recently passed a resolution to repeal the rule in the Senate. The Congressional Review Act effort is all but destined to fail: the Act would also require a joint-resolution from the House and would be subject to the president’s veto.

On March 19, 2023, the U.S. District Court for the Southern District of Texas issued a preliminary injunction to temporarily halt the enactment of the Biden administration’s new waters of the United States (WOTUS) rule within the borders of Texas and Idaho. (The case is Texas v. EPA, Case No. 3:23-cv-00017). In addition to the two state plaintiffs, eighteen national trade organizations asked the court to enjoin the rule across the nation. The court denied the trade organizations’ request, finding that the organizations did not have standing to sue because they could not prove they would suffer irreparable harm as a result of the rule’s implementation. On March 20, 2023, the rule became effective throughout the United States, except in Texas and Idaho.

Supreme Court Precedent and a Pending Decision – Contextualizing the Biden Administration’s WOTUS Rule

Though the district court’s discussion of the Biden administration’s WOTUS rule largely constrains itself to the language of the rule and the legal theories presented by each party, the 800 pound gorilla in the opinion is the pending U.S. Supreme Court decision in Sackett v. EPA. (8 F.4th 1075 (9th Cir. 2021), cert. granted Jan. 24, 2022). The issue in Sackett is whether the Ninth Circuit applied the proper test under the Clean Water Act to determine whether wetlands are WOTUS. The Ninth Circuit used the “significant nexus” test, which originates from Justice Kennedy’s concurrence in Rapanos v. United States. (547 U.S. 715 (2006)). During oral argument, the justices discussed the merits of both the significant nexus test and the Rapanos plurality’s alternate test, the “relatively permanent” test (authored by Justice Scalia). The Court’s ruling in Sackett is expected to clarify the process agencies should use to define WOTUS, and could be handed down as early as this summer.

Critics of the Biden administration’s WOTUS rule argue that the administration should have waited for the Court to determine the outcome of Sackett before promulgating a new rule. In a fact sheet released alongside the rule, the Biden administration counters that the rule is simply codifying the definition of WOTUS that “has been implemented by every administration in the last 45 years.” 

An Overview of Texas v. EPA

In their motion for the preliminary injunction, the states argued that the plain language of the Clean Water Act does not extend the federal government’s jurisdiction to

• non-navigable interstate waters,
• impoundments and wetlands with no hydrologic connection to navigable waters, or
• isolated ponds and mudflats, but that the Biden Administration’s new WOTUS rule would extend to all three of these types of water features.

The defendant federal agencies responded that federal jurisdiction over interstate waters is consistent with the Act’s history, text and purpose.

In the memorandum opinion accompanying the injunction, the court explains that state plaintiffs identified two aspects of the Biden administration’s WOTUS rule that it considers troubling:

• that the rule codifies a modified version of significant nexus test, and
• that the rule “imposes jurisdiction on all interstate waters, regardless of their navigability.” (Opinion at 7).

With regard to the first issue, the court writes that the significant nexus test in the Biden administration’s rule is “materially different from the standard Justice Kennedy articulated in Rapanos” because the rule expands federal jurisdiction over features that Justice Kennedy did not include, such as ephemeral drainages, ditches and non-navigable interstate waters. (Opinion at 21). This leads to the second issue: the court reasons that the by constructing the significant nexus test so that it includes all interstate waters, the administration is essentially reading the word ‘navigable’ out of the statute. Additionally, the court takes issue with the rule’s language allowing the Environmental Protection Agency and Army Corps of Engineers to regulate “interstate waters, regardless of their navigability.” (Opinion at 7). The court identifies the word ‘navigable’ as a “central requirement” of the Clean Water Act and thus finds both instances of its exclusion from the rule to be impermissible. (Opinion at 22).

We will continue to monitor the status of this rule and provide updates as necessary. For more information about the Biden administration’s WOTUS rule and a brief overview of how the term WOTUS operates within the Clean Water Act, see Nossaman’s previous eAlert.