Supreme Court To Decide When EPA and Perhaps Other Federal Agencies Can be Sued in Federal Court

By JP Ellison –

An important issue relating to when an action by an administrative agency can be challenged in court was argued before the Supreme Court last week.  The case involved administrative enforcement activities of the U.S. Environmental Protection Agency (“EPA”). The case, Sackett v. EPA (Docket No. 10-1062), involved a dispute between EPA and an Idaho couple and has recently received widespread press for the Justice’s sharp questioning of the government (see more here).  Buried within the intricacies of the Clean Water Act and this land use battle was the issue that may be of interest to our readers.

As we have explained in previous posts (here and here), the Administrative Procedure Act (“APA”) is the commonly used vehicle for challenging federal government action.  The APA requires final agency action for a lawsuit to be filed, and it is not uncommon for a case to be dismissed on the grounds that whatever else it represented, what the agency did was not final agency action. 

In the Sackett case, the government argued that EPA compliance orders were not final agency action, and therefore not subject to court review.  “‘The compliance order is not ‘final agency action.’  See 5 U.S.C. 704. A[n] . . . order marks only a step in EPA’s decision-making process, not its consummation.”  At oral argument, the Justices seemed unconvinced.   Justice Scalia asked “when you have something as formal as this which shows that the agency does intend to prosecute, why wouldn't you be able to bring a declaratory judgment action,”? and Justice Breyer observed, “of course a warning isn't reviewable. But this seems to meet the test where that [argument] fails.”

The government acknowledged during the argument that the issue before the Court had potentially wide-reaching ramifications, noting, that “it would cause a huge upheaval in the practices of many agencies to say that declaratory relief is typically available when the agency issued an informal warning.”

A prediction on when and how the Court will address this issue is beyond the scope of this post, but we will be watching for the decision later this year to see whether it sets forth a standard for judicial review of agency enforcement activities that upsets traditional notions of the types of agency action subject to challenge.