Marquette County Road Commission v. United States Environmental Protection Agency et al

Filing 50

OPINION ; signed by Judge Robert Holmes Bell (Judge Robert Holmes Bell, kcb)

UNITED STATES OF AMERICA
UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF MICHIGAN
NORTHERN DIVISION
MARQUETTE COUNTY ROAD
COMMISSION,
Plaintiff,

Case No. 2:15-cv-93

v.

Honorable Robert Holmes Bell

UNITED STATES ENVIRONMENTAL
PROTECTION AGENCY, et al.,
Defendants.
____________________________________/
OPINION
On May 18, 2016, the Court granted Defendants’ motion to dismiss for failure to state
a claim against the Environmental Protection Agency (“EPA”) because the EPA’s actions
were not reviewable under the Administrative Procedures Act (“APA”), 5 U.S.C. §§ 551 et
seq. (ECF No. 28.) The matter is before the Court on Plaintiff’s motion for reconsideration
in light of the Supreme Court’s decision in U.S. Army Corps of Eng’rs v. Hawkes Co., 136
S. Ct. 1807 (2016). (ECF No. 31.)
I.
Because the Federal Rules of Civil Procedure do not provide expressly for motions
for reconsideration, courts customarily treat them as motions to alter or amend judgment
under Federal Rule of Civil Procedure 59(e). See Huff v. Metro. Life Ins. Co., 678 F.2d 119,
122 (6th Cir. 1982) (“The district court properly treated the motion to reconsider as a motion

under Rule 59 to alter or amend judgment.”). The Rule provides that “[a] motion to alter or
amend a judgment must be filed no later than 28 days after the entry of the judgment.” Fed.
R. Civ. P. 59(e). “A district court may grant a Rule 59(e) motion only to (1) correct a clear
error of law, (2) account for newly discovered evidence, (3) accommodate an intervening
change in the controlling law, or (4) otherwise prevent manifest injustice.” Moore v. Coffee
Cty., TN, 402 F. App’x 107, 108 (6th Cir. 2010). “Rule 59(e) . . . does not permit parties to
effectively re-argue a case.” Howard v. United States, 533 F.3d 472, 475 (6th Cir. 2008).
To succeed on a motion for reconsideration, Plaintiff must “not only demonstrate a
palpable defect by which the Court and the parties have been misled, but also show that a
different disposition of the case must result from a correction thereof.” W.D. Mich. LCivR
7.4(a). “A defect is palpable if it is easily perceptible, plain, obvious, readily visible,
noticeable, patent, distinct or manifest.” Witherspoon v. Howes, No. 1:07-cv-981, 2008 WL
4155350, at *1 (W.D. Mich. Sep. 5, 2008) (citing Compuware Corp. v. Serena Software Int’l,
Inc., 77 F. Supp. 2d 816, 819 (E.D. Mich. 1999)). The decision to grant or deny a motion for
reconsideration under this Local Rule falls within the district court’s discretion. See
Evanston Ins. Co. v. Cogswell Props., LLC, 683 F.3d 684, 691 (6th Cir. 2012). A motion for
reconsideration presents an opportunity for the Court to address an erroneous factual
conclusion, because the Court overlooked or misconstrued the record, or to correct a
misunderstanding of the law, because the Court applied the wrong standard, wrong test,
relied on bad precedent, or something similar. Fleet Eng’rs, Inc. v. Mudguard Tech., LLC,
No. 1:12-CV-1143, 2013 WL 12085183, at *1 (W.D. Mich. Dec. 31, 2013). Disagreement
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with the Court’s interpretations of facts, or applications of the correct law, rarely provide a
sound basis for a motion for reconsideration. Id.
II.
The APA authorizes judicial review of “final agency action for which there is no other
adequate remedy in a court[.]” 5 U.S.C. § 704. There are two conditions that must be
satisfied in order for an agency action to be considered final under the APA. First, “the
action must mark the consummation of the agency’s decisionmaking process—it must not
be of a merely tentative or interlocutory nature.” Bennett v. Spear, 520 U.S. 154, 177-78
(1997). Second, “the action must be one by which rights or obligations have been
determined, or from which legal consequences will flow.” Id. However, “[e]ven if final,
an agency action is reviewable under the APA only if there are no adequate alternatives to
APA review in court.” Hawkes, 136 S. Ct. at 1815.
Plaintiff relies upon Hawkes, a recent Supreme Court decision, to argue that this
Court’s opinion contains a palpable defect, and that a different disposition of the case must
result from a correction thereof. In Hawkes, the Supreme Court held that an approved
jurisdictional determination (“JD”), which definitively stated the presence or absence of
waters of the United States on a particular property, was a final agency action. Hawkes, 136
S. Ct. at 1813. Under Bennett’s first prong, the Supreme Court held that an approved JD
“clearly ‘mark[ed] the consummation’ of the Corps’ decisionmaking process on that
question.” Id. Further, “the definitive nature of approved JDs also [gave] rise to ‘direct and
appreciable legal consequences,’ thereby satisfying the second prong of Bennett[.]” Id. at
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1814 (quoting Bennett, 520 U.S. at 178). The Supreme Court also held that the two
alternatives to direct judicial review of an approved JD—either discharge fill material
without a permit, risking an EPA enforcement action, or apply for a permit and seek judicial
review if dissatisfied with the results—were not adequate. Id. at 1815. Therefore, an
approved JD was a reviewable final-agency action. See id. at 1816 (affirming Eighth Circuit
judgment).
A. Consummation of the agency’s decisionmaking process
In its motion, Plaintiff equates the EPA’s objections with an approved JD. An
approved JD is issued after extensive fact-finding by the Corps, and is typically not revisited
if the permitting process moves forward. Id. at 1814. Although not dispositive, the Corps
has described approved JDs as final agency action. See 33 CFR § 320.1(a)(6); Hawkes, 136
S. Ct. at 1814; see also Nat’l Assoc. of Home Builders v. U.S. E.P.A., 956 F. Supp. 2d 198,
210 (D.C. Cir. 2015). Likewise, the Supreme Court has held that approved JDs are definitive
rulings by the Corps. Id.
Here, Plaintiff argues that, after permitting authority transfers to the Corps, there is
nothing left for the EPA to do. That is not entirely accurate. Indeed, once permitting
authority transfers to the Corps, the EPA lacks authority to withdraw its objections and return
permitting authority to the state. See Friends of Crystal River v. U.S. E.P.A., 35 F.3d 1073,
1080 (6th Cir. 1994) (“[T]he [Clean Water Act] specifically provides a time limit in which
a state must comply with EPA objections. A failure on the part of the state to so conform
within the statutory time limit results in the transfer of authority to the Army Corps.
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Consequently, we conclude Congress intends to completely divest the original agency of
jurisdiction, and vest authority in the Army Corps following expiration of the deadline.”).
Nonetheless, the EPA’s involvement in the permitting process continues even after
the Corps has permitting authority. Under § 404(b), a permit issued by the Corps must
specify the disposal sites for dredged or fill material, and § 404(c) permits the EPA
Administrator to “prohibit the specification . . . of any defined area as a disposal site . . .
whenever he determines, after notice and opportunity for public hearings, that the discharge
of such materials into such area . . . will have an unacceptable adverse effect[.]” 33 U.S.C.
§ 1344(c); see also C.F.R. § 323.6(b) (implement § 1344(c)). Thus, the EPA has statutory
authority to object to the permit’s specification of a defined area as a disposal site. Further,
when the Corps reviews a permit application, it will likely seek input from the EPA. See 33
C.F.R. § 384.5 (noting that Corps officials consult with and seek advice from all other
substantially-affected federal agencies).
Plaintiff urges the Court to review the actions of the EPA and the Corps separately.
The APA defines “agency” to mean “each authority of the Government of the United States,
whether or not it is within or subject to review by another agency[.]” 5 U.S.C. § 551(1). It
defines “agency action” to include “the whole or part of an agency rule, order, license,
sanction, relief, or the equivalent or denial thereof, or failure to act[.]” 5 U.S.C. § 551(13).
Plaintiff argues that, Congress’s use of the word “each” shows that, for the purpose of
determining final agency action, the EPA is to be regarded and treated separately from the
Corps. See Oxford English Dictionary 16 (2d ed. 1989) (defining each to mean “every
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(individual of a number) regarded or treated separately”). Further, Congress’s use of the
phrase “whether or not it is within or subject to review by another agency” supports this
approach. However, looking solely at the EPA, its involvement is not complete once
permitting authority transfers to the Corps; it retains veto power under § 404(c).
Moreover, Plaintiff’s interpretation would contravene congressional intent by
essentially ignoring the Corps’ permitting authority to allow applicants immediate access to
judicial review. The Clean Water Act (“CWA”), 33 U.S.C. §§ 1251 et seq., draws a clear
distinction between final agency actions that resolve the permitting process—the issuance
or denial of the permit by either the state or the Corps—and intermediate actions that require
its continuation—the EPA’s objections and the failure of the state to timely issue or deny the
permit. See Crystal River, 35 F.3d at 1079. Congress created an ongoing permitting process,
the final result of which is the issuance or denial of a permit, not the EPA’s objections.
Further, both the Corps is not bound by these objections. Rather, these objections are simply
“advisory in nature” and do not resolve the pending permit request. See Hawkes, 136 S. Ct.
at 1813 (noting the difference between an approved JD and a preliminary JD).
In addition, Bennett’s first prong was not at issue in Hawkes. Hawkes, 136 S. Ct. at
1813 (“[T]he Corps [did] not dispute that an approved JD satisfie[d] the first Bennett
condition.”). As such, Hawkes does not provide an intervening change in controlling law
with respect to this prong.

Therefore, Plaintiff has failed to satisfy its burden of

demonstrating a palpable defect by which the Court and the parties were misled, and it has
not shown that a different disposition of the case must result.
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B. Legal consequences
To determine whether there was a legal consequence under Bennett’s second prong,
the Supreme Court has examined whether the opposite result would have a legal
consequence. Hawkes, 136 S. Ct. at 1814. An affirmative JD was at issue in Hawkes. The
Court assessed whether a negative JD, a determination that a property did not contain waters
of the United States, had legal consequences. Under a Corps and EPA memorandum of
agreement, a negative JD was binding on both agencies, “creating a five-year safe harbor
from [enforcement] proceedings [under the CWA] for a property owner.” Id. at 1814. Thus,
the Court held that, because an affirmative JD represented the denial of the five-year safe
harbor that negative JDs afford, an affirmative JD had legal consequences. Id. (citing 5
U.S.C. § 551(13)).
Plaintiff analogizes a negative JD to the situation where the EPA concurs with the
state’s issuance of a proposed § 404 permit. If the EPA concurs, the applicant would receive
a state permit, with the force and effect of both state and federal law, which is binding for
five years. Likewise, Plaintiff argues that the EPA’s objections had real and appreciable
legal consequences because the EPA deprived Plaintiff of the proposed state permit and
obligated Plaintiff to go through the Corps’ permitting process. Similar to an affirmative JD,
the EPA’s objections divested Plaintiff of the permit proposed by the state and created the
need for Plaintiff to seek a permit from the Corps.
Defendant argues that delaying or requiring an applicant to continue through the full
administrative process is not a legal consequence. Further, the situation in Hawkes is
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distinguishable from the permitting process at issue here. In Hawkes, as a result of the
memorandum of agreement, a negative JD bound both agencies to a five-year safe harbor
from enforcement proceedings. Hawkes, 136 S. Ct. at 1814. Thus, a negative JD “both
narrow[ed] the field of potential plaintiffs and limit[ed] the potential liability a landowner
faces for discharging pollutants without a permit. Each of those effects is a ‘legal
consequence[]’ satisfying the second Bennett prong.” Id. Consequently, an affirmative JD,
which was also binding for five years, amounted to a conclusive denial of that five-year safe
harbor period.
In contrast, here, Plaintiff’s permit has not been denied. In Plaintiff’s own words, the
EPA’s objections “created the need for Plaintiff to seek a permit from the Corps.” (ECF No.
32, PageID.2017.) This is not a legal consequence. See FTC v. Standard Oil Co. of Cal.,
449 U.S. 232, 242 (1980) (noting that complying with administrative proceedings “is
different in kind and legal effect from the burdens attending what heretofore has been
considered to be final agency action”).

Plaintiff must simply continue with the

administrative process. There has been no conclusive denial of the permit. In fact, there has
been no definitive decision by any permitting authority as to whether, or under what
conditions, Plaintiff should receive a permit. Therefore, Plaintiff has failed to show a
palpable defect upon which the Court was misled and whose correction requires a different
disposition in the case.
C. Adequacy of alternatives
Plaintiff also argues that the availability of obtaining a permit from the Corps is
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relevant to the Court’s determination of whether there exists an adequate alternative remedy
at law. Plaintiff relies on Hawkes to argue that obtaining a permit from the Corps is not an
adequate alternative. In Hawkes, the Supreme Court held that “it [was not] an adequate
alternative to APA review for a landowner to apply for a permit and then seek judicial review
in the event of an unfavorable decision [of a JD].” Hawkes, 136 S. Ct. at 1815. Plaintiff
relies upon the Supreme Court’s language that the Corps’ process can be “arduous,
expensive, and long” to argue that a Corps permit is not an adequate alternative remedy to
judicial review. See id. at 1815.
Again, Hawkes is distinguishable from this case. In the event of an unfavorable
decision regarding a JD, the landowner could apply for a permit and seek judicial review of
its denial. The permit was a separate, alternative remedy to the JD decision. Here, the permit
itself is at issue. In other words, a permit from the Corps is not an alternative; it is the very
thing that Plaintiff sought from the state. Accordingly, Plaintiff has failed to demonstrate a
palpable defect, in light of Hawkes, whose correction requires a different disposition of the
case.
D. Other grounds for reconsideration
Plaintiff’s remaining claims simply raise the same arguments that this Court has
already rejected. Under Local Rule 7.4(a), the Court need not address the substance of these
arguments. W.D. Mich. LR 7.4(a) (“[M]otions for reconsideration which merely present the
same issues ruled upon by the Court shall not be granted.”). Therefore, the Court denies
Plaintiff’s motion for reconsideration of those claims. See, e.g., Savage v. United States, 102
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F. App’x 20, 22-23 (6th Cir. 2004) (affirming the district court’s denial of a motion for
reconsideration because the movant “essentially reasserted the issues raised” previously);
Graham ex rel. Estate of Graham v. Cty. of Washtenaw, 358 F.3d 377, 385-86 (6th Cir.
2004) (affirming the district court’s denial of the motion for reconsideration because it
“merely raised arguments that were already ruled upon; it failed to show either a reason
justifying relief from the judgment or a palpable defect by which the court was misled”).
IV.
The Supreme Court has instructed courts to apply the APA’s finality requirement in
a “flexible” and “pragmatic” way. Abbott Labs. v. Gardner, 387 U.S. 136, 149-50 (1967).
But this flexible and pragmatic approach should not be used to contravene the administrative
process that Congress created in the CWA. Plaintiff relies on the presumption of judicial
review of agency action, but that presumption applies only to final agency action. Hawkes,
136 S. Ct. at 1811 (quoting Sackett v. EPA, 132 S. Ct. 1367, 1373 (2012)).
Further, Hawkes did not fundamentally alter Bennett’s requirements for final agency
action. Plaintiff has not shown a plain or obvious error in the Court’s decision. At most,
Plaintiff has shown that it disagrees with the Court’s interpretation of fact and law. In light
of Hawkes, Plaintiff has failed to show a palpable defect in the Court’s decision, and that a
different disposition of the case must result. Therefore, the Court denies Plaintiff’s motion
for reconsideration.
An order will enter in accordance with this opinion.

Dated: December 14, 2016

/s/ Robert Holmes Bell
ROBERT HOLMES BELL
UNITED STATES DISTRICT JUDGE

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