Constitution Pipeline Co. v. New York State Department of Environmental Conservation, 868 F.3d 87

Background

Constitution Pipeline sought a CWA §401 water quality certification from NYSDEC for a 121-mile interstate pipeline; NYSDEC denied the application on April 22, 2016 for failing to provide sufficient information, especially site-specific data on stream crossings and trenchless feasibility.
The pipeline would cross 251 streams in New York (87 supporting trout/trout spawning); Constitution planned trenchless methods for a small subset and trenched (open-cut) methods for most crossings.
NYSDEC repeatedly requested site-specific trenchless feasibility analyses (geotechnical borings, trenchless plans) and other information (blasting plans, burial depth, alternative routes); Constitution provided limited geotechnical data for only two crossings and resisted analyzing streams <30 feet for trenchless methods.
NYSDEC concluded trenchless technology is the most protective method for many crossings, found Constitution’s submissions inadequate to assure compliance with New York water quality standards (6 NYCRR pts. 701–704), and denied the §401 certification for lack of reasonable assurance.
Constitution petitioned the Second Circuit challenging (1) NYSDEC’s timeliness (arguing waiver under §401 if State fails to act within a reasonable time) and (2) the merits (arguing NYSDEC acted arbitrarily, capriciously, and beyond its authority).
The court dismissed the timeliness claim for lack of jurisdiction (15 U.S.C. §717r(d)(2) vests exclusive jurisdiction over alleged agency delay in D.C. Circuit) and denied the merits challenge, holding NYSDEC acted within its authority and did not act arbitrarily or capriciously.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether NYSDEC waived §401 authority by acting untimely	Constitution: NYSDEC failed to act within §401’s reasonable-period (≤1 year) and thus waived certification; court should order NYSDEC to notify USACE of waiver	NYSDEC: did not have all requested information; agency actively sought information and later issued a reasoned denial	Dismissed for lack of jurisdiction — alleged agency delay claims fall under D.C. Circuit’s exclusive jurisdiction under 15 U.S.C. §717r(d)(2).
Whether NYSDEC’s denial was arbitrary, capricious, or ultra vires	Constitution: it provided sufficient information; NYSDEC impermissibly second-guessed FERC/NEPA and exceeded authority by demanding route, blasting, and burial-depth details	NYSDEC: requested relevant, site-specific data tied to state water quality standards; authority preserved by CWA §401 and NY water quality regs	Denied — court defers to NYSDEC’s expertise; record shows repeated requests and insufficiency of submitted data; denial rationally connected to facts and statute.
Whether NEPA/FERC preempted NYSDEC’s §401 review	Constitution: FERC’s FEIS/NEPA process preempts state reexamination of matters already considered by FERC	NYSDEC: NEPA does not create substantive standards or foreclose state statutory §401 authority; NGA preserves CWA rights of states	Held for NYSDEC — NEPA does not displace §401 review; state may assess compliance with its own EPA-approved water quality standards.
Whether industry practice (e.g., not using trenchless for <30ft streams) defeats NYSDEC’s information requests	Constitution: trenchless methods are impractical for streams <30 ft, an industry-recognized threshold, so extensive site-specific analysis is unnecessary	NYSDEC: industry choices do not limit environmental relevance; site-specific geotechnical data needed to ensure compliance with state standards	Held for NYSDEC — agency properly required site-specific proof; industry preference alone does not make the agency’s requests arbitrary.

Key Cases Cited

Islander East Pipeline Co. v. McCarthy, 525 F.3d 141 (2d Cir.) (deference to state §401 role and arbitrary-and-capricious review standard)
Islander East Pipeline Co. v. Connecticut Dep’t of Envtl. Prot., 482 F.3d 79 (2d Cir.) (state §401 authority and review of alternatives)
Weaver’s Cove Energy, LLC v. Rhode Island Dep’t of Envtl. Mgmt., 524 F.3d 1330 (D.C. Cir.) (jurisdiction for alleged agency delay falls to D.C. Circuit)
Motor Vehicle Mfrs. Ass’n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29 (U.S.) (standard for arbitrary and capricious review)
Robertson v. Methow Valley Citizens Council, 490 U.S. 332 (U.S.) (NEPA creates procedural duties, not substantive standards)
Marsh v. Oregon Natural Res. Council, 490 U.S. 360 (U.S.) (agency discretion and deference on significance of new information)