In re Clean Water Act Rulemaking

District Court, N.D. California·Decided December 7, 2021·No. 3:20-cv-04636·Unknown

Opinion

1 2 3 4 5 6 UNITED STATES DISTRICT COURT 7 NORTHERN DISTRICT OF CALIFORNIA 8

10 In re No. C 20-04636 WHA No. C 20-04869 WHA 11 CLEAN WATER ACT No. C 20-06137 WHA RULEMAKING. 12

13 This Document Relates to: (Consolidated)

14 ALL ACTIONS. ORDER DENYING MOTION FOR STAY PENDING APPEAL 15

17 INTRODUCTION 18 Intervenor defendants move for a stay of the order vacating and remanding EPA’s Clean 19 Water Act Section 401 certification rule pending appeal. Intervenors’ arguments on the merits 20 and irreparable harm provide lukewarm support for a stay. On the other side, a stay would 21 substantially injure plaintiffs and does not align with the public interest. The motion is 22 DENIED. 23 STATEMENT 24 The previous order at issue here describes our facts (Dkt. No. 173). In brief, Congress 25 enacted the Federal Water Pollution Control Act Amendments of 1972, commonly referred to 26 as the Clean Water Act, with the express goal “to restore and maintain the chemical, physical, 27 and biological integrity of the Nation’s waters.” 33 U.S.C. § 1251(a). Relevant here, under 1 seeks to conduct any activity that may result in any discharge into the navigable waters of the 2 United States unless the state where the discharge would originate issues a water quality 3 certification or waives the requirement. Authorized tribes and EPA can also act as certifying 4 entities. Notably: “No license or permit shall be granted if certification has been denied by the 5 State, interstate agency, or the Administrator [of the EPA], as the case may be.” 33 U.S.C. § 6 1341(a)(1). Section 401 certifications are required for certain permits issued by, for example, 7 the Army Corps of Engineers and the Federal Energy Regulatory Commission (FERC). 8 EPA employed 40 C.F.R. Part 121 to administer Section 401 certifications, which the 9 agency had promulgated a year prior to the Clean Water Act to regulate water quality 10 certifications pursuant to Section 21(b) of the FWPCA. See 36 Fed. Reg. 22,487 (Nov. 25, 11 1971), redesignated at 37 Fed. Reg. 21,441 (Oct. 11, 1972), redesignated at 44 Fed. Reg. 12 32,899 (June 7, 1979). EPA utilized this regulation unchanged for half a century. This order 13 will refer to this certification rule as the 1971 rule. 14 On September 11, 2020, EPA revised 40 C.F.R. Part 121 in accordance with President 15 Trump’s Executive Order 13,868, which asserted that the “Federal Government must promote 16 efficient permitting processes and reduce regulatory uncertainties that currently make energy 17 infrastructure projects expensive and that discourage new investment.” 84 Fed. Reg. 15,495 18 (Apr. 15, 2019); see also 85 Fed. Reg. 42,210 (July 13, 2020). The revised Section 401 19 certification rule — which this order will refer to as the 2020 rule — parted ways with the 20 1971 rule in dramatic fashion. This led to challenges to the rule by our plaintiff states, tribes, 21 and non-profit conservation groups. Those actions eventually consolidated before the 22 undersigned. 23 In October 2020, eight states and three industry groups intervened as defendants. But the 24 election of President Biden in November shifted the course of this litigation. On January 20, 25 2021, Executive Order 13,990 revoked Executive Order 13,868. The Biden administration also 26 specifically listed the 2020 rule as one agency action it planned to review. Five months later, 27 on June 2, 2021, EPA noticed its intent to revise the 2020 rule. EPA expects to finalize the 1 (June 2, 2021); Fact Sheet: List of Agency Actions for Review, 2 https://www.whitehouse.gov/briefing-room/statements-releases/2021/01/20/fact-sheet-list-of- 3 agency-actions-for-review/ (Jan. 20, 2021). 4 Less than a month after EPA announced it would revise the 2020 rule, the agency, in this 5 action, moved for remand of the rule without vacatur (Dkt. No. 143). Plaintiffs, opposing the 6 motion, argued that the 2020 rule should be vacated upon remand to the agency. Intervenors, 7 who had chosen not to file any briefing on EPA’s motion up to that point, filed a reply brief 8 arguing for remand without vacatur and separately moved to strike plaintiffs’ vacatur 9 arguments (Dkt. Nos. 148, 155). After a hearing on the motions, intervenors were offered the 10 opportunity to file supplemental briefing on the vacatur issue, which they did (Dkt. No. 172). 11 An October 2021 order vacated and remanded the 2020 rule (Vacatur Order, Dkt. No. 12 173). EPA has stated it will not appeal the vacatur order. Intervenors, however, now move for 13 a stay of the vacatur order pending their own appeal. To expedite the hearing on this motion, 14 defendants waived their reply briefing. This order follows oral argument held telephonically 15 due to the COVID-19 pandemic. 16 ANALYSIS 17 Under the traditional test for a stay pending appeal, a district court considers four factors: 18 (1) whether the stay applicant has made a strong showing that he is likely to succeed on the merits; (2) whether the applicant will be 19 irreparably injured absent a stay; (3) whether issuance of the stay will substantially injure the other parties interested in the 20 proceeding; and (4) where the public interest lies. 21 Nken v. Holder, 556 U.S. 418, 433–34 (2009); see also Al Otro Lado v. Wolf, 952 F.3d 999, 22 1006–07 (9th Cir. 2020). 23 Our court of appeals has instructed that we weigh these factors using a flexible, sliding- 24 scale approach, under which “a stronger showing of one element may offset a weaker showing 25 of another.” Leiva-Perez v. Holder, 640 F.3d 962, 964, 966 (9th Cir. 2011). The first two 26 factors are the most critical. The mere possibility of success or irreparable injury are 27 insufficient. A movant must show “at a minimum, that she has a substantial case for relief on 1 demonstrate irreparable harm is probable, not merely possible. We consider the final two 2 factors — which tend to merge when the government is an opposing party — once a movant 3 satisfies the first two. Nken, 556 U.S. at 435; United States v. Mitchell, 971 F.3d 993, 996 (9th 4 Cir. 2020). If a petition raises at least a serious question going to the merits, the other factors 5 can be satisfied by a showing that the balance of hardships tips sharply in the movant’s favor. 6 Leiva-Perez, 640 F.3d at 970. 7 This order will proceed through the stay factors in a moment, but offers this overview. 8 On the one hand, allowing the 1971 rule to remain in effect will give certifying entities greater 9 latitude to prescribe more conditions. This would harm those who wish to be free of further 10 requirements, such as our intervenor defendants. On the other hand, should we allow the 2020 11 rule to remain in effect, those certifying entities that wish to impose more conditions on 12 Section 401 certifications will lose the opportunity to do so. This would result in harm to 13 them. We face a crossroads where one side or the other will suffer some harm, no matter what. 14 But harm is one thing, irreparable harm another. Certifying entities that dislike more 15 conditions can simply choose not to impose additional conditions. And, a party saddled with 16 unwanted conditions can sue in district court if presented with a flawed certification process. 17 These considerations mitigate some potential harms.

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