893 F.3d 1017
7th Cir.2018Background
- Orchard Hill purchased the 100-acre Warmke parcel in 1995, developed part of it, and in 2006 sought a Corps jurisdictional determination for ~13 acres of newly formed wetlands on the site.
- The Corps concluded the Warmke wetlands were "waters of the United States" because they drained (via sewer pipes) to Midlothian Creek, a tributary of the Little Calumet River, and thus were "adjacent" to a tributary under the pre-2015 Corps regulation.
- After Rapanos, the Corps applied the "significant nexus" test (Kennedy concurrence) and, following several administrative remands and supplemental reports, relied on a claim that 165 other wetlands in the Midlothian Creek watershed were "similarly situated" and, in combination, produced significant effects downstream.
- Orchard Hill challenged the final jurisdictional determination in district court under the APA; the district court deferred to the Corps and granted summary judgment for the agency.
- The Seventh Circuit held the Corps had not supplied substantial evidence or adequate explanation that (1) the Warmke wetlands alone significantly affected the Little Calumet River, and (2) the 165 listed wetlands were actually "similarly situated" (i.e., adjacent to the same tributary) so their combined effects could be aggregated.
- The Seventh Circuit vacated the district court's judgment and remanded to the Corps for reconsideration, declining to reach Orchard Hill's separate APA notice-and-comment challenge to the five-year abandonment rule.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Corps demonstrated a "significant nexus" between the Warmke wetlands and navigable waters | Orchard Hill: Corps' findings are speculative and lack testing; Warmke wetlands alone do not significantly affect the Little Calumet River | Corps: Warmke wetlands have an intermittent hydrologic connection and, by filtering pollutants and reducing floodwaters, can affect downstream waters | Held: Corps' "alone" nexus findings are speculative and unsupported by substantial evidence |
| Whether the Corps permissibly aggregated effects of other wetlands as "similarly situated" | Orchard Hill: Corps failed to show the 165 wetlands are adjacent or similarly situated to Midlothian Creek; list lacks maps, proximity data, or testing | Corps: Rapanos Guidance allows considering all wetlands adjacent to the same tributary; NWI data identifies 165 wetlands in the watershed | Held: Corps failed to substantiate that the 165 wetlands are "similarly situated" or adjacent; aggregation unsupported by the record |
| Whether agency conclusions deserve deference absent detailed explanation or record support | Orchard Hill: Deference not warranted where agency offers no record support or reasoning | Corps: Corps' interpretation and findings merit deference (Skidmore/agency expertise) | Held: Deference does not apply where key factual findings lack record support or reasoned explanation |
| Remedy: Whether the court should vacate and remand the Corps' determination | Orchard Hill: Vacatur and remand required due to lack of substantial evidence | Corps: Final determination should be sustained | Held: Vacated and remanded to the Corps for reconsideration with instructions to provide adequate factual support and explanation |
Key Cases Cited
- Rapanos v. United States, 547 U.S. 715 (2006) (Kennedy concurrence articulating "significant nexus" test for wetlands adjacent to non-navigable tributaries)
- U.S. Army Corps of Eng'rs v. Hawkes Co., 578 U.S. 590 (2016) (approved jurisdictional determinations are final agency action reviewable under the APA)
- Precon Dev. Corp. v. U.S. Army Corps of Eng'rs, 633 F.3d 278 (4th Cir. 2011) (deference to Corps' interpretation of "similarly situated" where agency provided reasoned factual grounds)
- Solid Waste Agency of N. Cook Cnty. v. U.S. Army Corps of Eng'rs, 531 U.S. 159 (2001) (limits on Corps' jurisdiction over isolated intrastate waters)
- United States v. Gerke Excavating, Inc., 464 F.3d 723 (7th Cir. 2006) (Seventh Circuit follows Kennedy concurrence from Rapanos)
- Motor Vehicle Mfrs. Ass'n v. State Farm Mutual Automobile Ins. Co., 463 U.S. 29 (1983) (agency action must include reasoned explanation; courts should not supply missing basis)