EPA WOTUS Rule Takes Effect in Most States – Or Does It?

The rule enacted by the EPA and the Army Corps of Engineers intended to clarify the scope of jurisdictional waters of the United States (often referred to as the WOTUS Rule or Clean Water Rule) was set to take effect on August 28. One day prior to that, a judge in the U.S. District Court for North Dakota issued a preliminary injunction in North Dakota v. EPA, No. 3:15-cv-59, prohibiting application of the rule based on the court’s view that the rule likely exceeded the agencies’ statutory authority and suffered from procedural defects.

Now the same federal judge, Ralph Erickson, must determine whether the injunction he issued applies nationwide, thereby completely barring application of the WOTUS rule even though the rule’s validity is the subject of litigation pending before several other federal courts. (Not only that, but it is not clear whether Judge Erickson’s district court had jurisdiction to hear the case. Two district courts have held that the Clean Water Act requires that a challenge to the WOTUS rule be heard solely by one of the U.S. Courts of Appeals and the U.S. Judicial Panel on Multidistrict Litigation has consolidated challenges to the rule before the Sixth Circuit.)

The EPA and the Army Corps argue that the preliminary injunction should apply only in the thirteen states that were plaintiffs before Judge Erickson. The plaintiff states argue that the injunction should apply nationwide. The parties have submitted briefs on the proper scope of the injunction and are awaiting Judge Erickson’s ruling.

The case has highlighted an interesting jurisdictional question arising from the fact that there is no set rule governing what happens when a federal district court invalidates a federal agency regulation. Does the court’s holding apply only within the geographic boundaries where the district court has jurisdiction? Does it apply to the jurisdictions where the succesful plaintiffs are located? Does the holding apply to the rule itself, invalidating the agency action irrespective of geographical factors (i.e. nationwide)?

The answer is that it could be any of the above, depending on two factors: what the court believes is required to provide adequate relief to the prevailing parties and what is required to abide by the somewhat nebulous concept of comity between federal courts. When an “injunction has the effect of precluding other circuits from ruling” on the validity of a federal regulation, “such a result conflicts with the principle that a federal court of appeals’s decision is only binding within its circuit.” Virginia Soc’y for Human Life, Inc. v. Fed. Election Comm’n, 263 F.3d 379, 393 (4th Cir. 2001).

Although the Eighth Circuit (in which North Dakota is located) has little or no helpful case law on the issue, the fact that identical litigation is pending before both district and circuit courts in multiple jurisdictions should weigh heavily in favor of Judge Erickson ruling that his preliminary injunction does not apply nationwide.

In the meantime, the only thing guaranteed to apply nationwide will be regulatory confusion.