727 F.3d 700
7th Cir.2013Background
- Flambeau Mining operated a mine in Wisconsin; WDNR regulated stormwater under a mining permit and terminated a separate WPDES (NPDES-equivalent) permit after concluding the mining permit provided equivalent stormwater controls.
- Wisconsin codified the authority to treat other state permits as WPDES coverage in NR § 216.21(4)(a); Wisconsin submitted revisions to EPA in 1994 and EPA commented but did not issue a formal, published approval letter.
- Plaintiffs (Wisconsin Resources Protection Council, Center for Biological Diversity, Laura Gauger) sued under the CWA citizen-suit provision, alleging unpermitted discharges of copper after Flambeau’s WPDES permit termination.
- District court denied Flambeau’s summary-judgment claim that the CWA permit-shield (33 U.S.C. § 1342(k)) applied because plaintiffs argued NR § 216.21(4)(a) was not EPA-approved; after a bench trial the district court found 11 past violations and imposed nominal penalties but denied plaintiffs’ fee request.
- Seventh Circuit reversed: it held that where a state permitting authority issues a facially valid permit (or treats another state permit as covering discharges) and the permittee lacked notice the permit might be invalid, due process precludes imposing CWA penalties — hence the permit shield applied and summary judgment should have been granted.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the CWA permit shield applies to Flambeau’s discharges | NR § 216.21(4)(a) was not part of Wisconsin’s EPA‑approved NPDES program, so Flambeau lacks an authorized permit and is not shielded | WDNR treated the mining permit as WPDES coverage, EPA reviewed and commented on the state revisions, and Flambeau lacked notice the permit might be invalid | Permit shield applies: a facially valid permit (or state action treating a permit as WPDES coverage) bars penalties when the permittee had no notice of invalidity (due process) |
| Whether a permittee must prove EPA approval of a specific state regulatory provision to invoke the shield | Plaintiffs say yes — permit shield requires proof the state provision (NR § 216.21(4)(a)) was EPA‑approved | Flambeau says requiring such proof is unreasonable; permittees reasonably rely on the state permitting authority and published regulations | Court rejects requiring collateral proof of EPA approval; would undermine permit finality and fairness |
| Whether Flambeau had constructive notice it lacked a WPDES permit | Plaintiffs point to Flambeau’s earlier WPDES permit and permit language requiring other permits | Flambeau relied on WDNR’s termination of the separate WPDES permit and WDNR’s position that the mining permit provided required controls | Flambeau did not have adequate notice; WDNR’s official actions and regulations provided fair warning |
| Entitlement to attorneys’ fees under the CWA | Plaintiffs claim prevailing party status after district-court liability finding | Flambeau contends the permit shield defeats liability | Plaintiffs are not prevailing/substantially prevailing because permit shield applies and therefore are not entitled to fees |
Key Cases Cited
- Piney Run Pres. Ass’n v. Cnty. Commis., 268 F.3d 255 (4th Cir. 2001) (explains permit shield effect when discharges comply with permit terms)
- E.I. du Pont de Nemours & Co. v. Train, 430 U.S. 112 (1977) (permit shield purpose: afford permits finality)
- Kelly v. United States EPA, 203 F.3d 519 (7th Cir. 2000) (CWA is a strict liability statute)
- United States v. Cinergy Corp., 623 F.3d 455 (7th Cir. 2010) (regulated parties get fair‑notice protection when complying with published state‑approved rules)
- Gen. Elec. Co. v. United States EPA, 53 F.3d 1324 (D.C. Cir. 1995) (fair notice requirement in administrative sanctions context)
- Howmet Corp. v. EPA, 614 F.3d 544 (D.C. Cir. 2010) (agency public statements/regulations determine fair notice)
- Rollins Envtl. Servs. (NJ), Inc. v. United States EPA, 937 F.2d 649 (D.C. Cir. 1991) (absence of public notice precludes imposing civil liability for regulatory violations)