Seventh Circuit Holds Federal Agencies Can Be Sued for Public Nuisance, But Affirms Dismissal of Claim

by BakerHostetler

On July 14, 2014, the Seventh Circuit decided Michigan et al. v. U.S. Army Corps of Engineers et al. (Wood, C.J., writing for a unanimous panel). While the court ultimately affirmed dismissal of the underlying action, the opinion’s holding concerning federal-agency liability for the federal common-law tort of public nuisance deserves notice. It may support future litigation on such a theory of liability across a broad range of environmental issues.

In Michigan, five states and a native tribe sued federal and state government entities under the Administrative Procedure Act (“APA”) and the federal common law of public nuisance. The plaintiffs alleged that two invasive species of Asian carp, introduced to southern fish farms in the 1970s to control plant growth, have migrated so far up the Mississippi River system that they now threaten to invade the Great Lakes. The defendants are jointly responsible for controlling the Chicago Area Waterway System (“CAWS”), part of a series of canals and channels that connect the lakes to the river. Plaintiffs requested preliminary and permanent injunctive relief directing the defendants to effect “hydrological separation” between the river and the Lakes. (There is evidence that the carp have already reached CAWS, and may be as little as six miles from reaching Lake Michigan.)

On an earlier appeal, the Circuit had affirmed the district court’s denial of preliminary relief, holding it unlikely that the requested injunction would meaningfully lower the risk that the carp would reach the lakes before a ruling on the merits. 667 F.3d 765. On that first appeal, the Circuit held that the suit fell within the APA’s waiver of federal sovereign immunity, but did not decide whether a federal common-law nuisance claim can be stated against the federal government. Following that appeal, the district court dismissed the complaint for failure to state a claim, holding that “maintenance of the hydrologic connection” between the river and the lakes is lawful, authorized, and indeed required by the federal Rivers and Harbors Act.

On the second, instant appeal, the Circuit reached the question it had not decided before: whether federal agencies are liable to federal common-law nuisance claims. Rejecting the position that federal government action is by definition in the public interest, the court distinguished between, on the one hand, “[a]ctivities commanded or authorized by statute” and “agency rules promulgated pursuant to congressional delegation—which are presumed to reflect the public interest—and, on the other, an “agency’s choice of a particular course of action” that “may or may not be consistent with the underlying statute and regulations.” The latter may give rise to public-nuisance liability.

The Circuit then disagreed with the district court’s holding that federal law commanded the defendants to maintain the connection between the river and the lakes. None of the statutes relied on below require the connection to be kept open “for navigation at all times and under all circumstances.” The defendants are authorized to maintain that connection, but are not authorized to maintain it in such a manner as to permit passage of an invasive species.

Nonetheless, the Circuit ultimately affirmed the dismissal. It determined that the complaint did not plausibly allege that the Corps’ current operation of the CAWS will allow the carp to pass through. And it expressed reluctance to direct the Corps to implement any particular solution to the problem. While reiterating that it took the threat of invasive species seriously, the court noted that the Corps is “making diligent efforts to find the solution” that will balance ecological interests with the public benefits the CAWS affords. (However, the court expressly rejected defendants’ argument that they could not have “caused” the carps’ migration: “It is the defendants’ apparent diligence, rather than their claimed helplessness, that is key to our holding today.”) Finally, the court noted that plaintiffs may have additional remedies under the APA, now or in the future, especially “if the Corps stalls on progress toward a solution.”

While these plaintiffs have been dealt a setback, the broader significance of this opinion lies in its thoughtful discussion of the history and scope of the federal common law of nuisance. Its clear holding that federal agencies can in some circumstances be liable under that law may well inspire future litigation in this and other environmental subject areas.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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