Environmental Corner: Legal Updates From Around the Nation

Ninth Circuit Court of Appeals:

In Baccarat Fremont Developers, LLC v. U.S. Army Corps of Eng'rs, 425 F.3d 1150 (9th Cir. 2005): The developers challenged a determination of the Army Corps of Engineers (“Corps”) that wetlands located on the developer’s property are navigable and adjacent to waters of the United States and that the Corps therefore has jurisdiction under the Clean Water Act.  The wetlands in question are located near flood control channels that connect to the San Francisco Bay, however they are separated from the channels by sixty five feet at their closest point and they are also separated by man-made berms.  The developers argued that the wetlands were not adjacent because there was a lack of an “adequate hydrological or ecological connection” between the wetlands and waters of the United States.  However, the court rejected this argument and held that it is sufficient that the “wetlands have significant effects on neighboring aquatic ecosystems.”

Seventh Circuit Court of Appeals:

The Seventh Circuit recently held that merely prevailing against the Environmental Protection Agency’s allegations of Clean Water Act violations does not entitle a developer to legal fees under the Equal Access to Justice Act.  Bricks, Inc. v. U.S. Environmental Protection Agency, No. 05-1125 (7th Cir. 2005).  The EPA alleged that the landowner violated the Clean Water Act by discharging fill material into wetlands because the EPA contended that the wetlands met the definition of “waters of the United States.”  The developer argued that the wetlands were isolated and therefore were not subject to the Clean Water Act.  The EPA initially prevailed, but that decision was overturned by the Environmental Appeals Board, which found that the EPA had not demonstrated by a preponderance of the evidence that the wetlands were “waters of the United States.”  The Developer then filed a claim for legal fees under the Equal Access to Justice Act alleging that the EPA’s allegations were not “substantially justified.”  The Administrative Law Judge found in favor of the developer, relying on United States v. Hallmark Construction Co., 200 F.3d 1076 (7th Cir.2000).  However, the Seventh Circuit overturned that decision and held that the allegations were “substantially justified” because the matter was a close call.  The court distinguished Hallmark because in that case the district court had concluded that the Army Corps of Engineers acted in an arbitrary and capricious manner and therefore the Corps’ allegations could not be “substantially justified,” whereas here the matter was a close call.

U.S. District Court in Florida:

In Fla. Wildlife Federation v. U.S. Army Corps of Eng'rs, 2005 U.S. Dist. LEXIS 27356 (D. Fla. 2005), the Army Corps of Engineers (“Corps”) granted a permit allowing the dredging and filling of wetlands for the development of a research park on land provided by Palm Beach County.  The planned research park would be a cluster of organizations in the biotech industry, with the Scripps Research Institute as the anchor and other biotech firms occupying other facilities on the site.  The Florida Wildlife Association and the Sierra Club sued to: (1) have the permit aside; (2) force the Corps to issue an environmental impact statement; and (3) enjoin further development until there was an environmental review.

The court decided to set aside the permit because the environmental assessment was not in accordance with the law and the determination of no significant impact was arbitrary and capricious.  However, the court declined to direct the Corps to prepare an environmental impact statement because the court determined that if it did, it would be substituting its own judgment for the Corps’.  Lastly, the court did issue an injunction prohibiting future construction, with minor exceptions.  However, the court concluded that it would be inequitable to prohibit Scripps from continuing construction of its facilities, which was already well underway, because: (1) the wetlands on which Scripps’ facilities were to be built were already filled; (2) when the land was transferred to Scripps, it did not require any federal permits or authorization to begin construction; and (3) Scripps received $5 million gift that required it to build its facilities on the site in question. 

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