The Swamps-On-a-Hill Have Citizens On a Roll: The Fourth Circuit Advances the Citizens' Cause in National Wildlife Federation v. Hanson

Katherine P. Ransel

Ms. Ransel, currently a senior attorney with the Environmental Law Institute, was lead counsel for the plaintiffs in the district court litigation on the merits and the district court fee litigation. The opinions expressed in this Dialogue do not necessarily reflect the views of the Institute.

[19 ELR 10003]

On October 14, 1988, the Court of Appeals for the Fourth Circuit issued an attorneys fees ruling¹ clarifying citizens' rights to challenge Corps of Engineers' determinations that areas are not wetlands and thus not subject to the permitting requirements of § 404 of the Federal Water Pollution Control Act (FWPCA or the Act).² The decision comes in a case that may be the largest enforcement action, in terms of acreage, ever brought by government or citizenry.³ It was brought by the National Wildlife Federation and the Environmental Policy Institute, two national conservation organizations, and six North Carolina environmental citizen groups.⁴

The Fourth Circuit panel unanimously ruled that the Corps of Engineers (the Corps) has a nondiscretionary duty to regulate dredged or fill material, and to fulfill that duty it must make "reasoned" wetlands determinations. The Corps has, the panel ruled, "a mandatory duty to ascertain the relevant facts, correctly construe the applicable statutes and regulations, and properly apply the law to the facts."⁵ This holding means that citizens may bring suit pursuant to § 505(a)(2) of the FWPCA to challenge wetlands determinations — and presumably other jurisdictional decisions — rendered by the Corps and/or the Environmental Protection Agency(EPA) under the Act's § 404 program.⁶ This issue has never before been squarely addressed by a circuit court of appeals.

On the Merits: The Corps Refuses to Assert Jurisdiction

The suit was originally brought in September 1983 alleging jurisdiction under FWPCA § 505(a)(2), which creates a cause of action for citizens alleging a failure on the part of the EPA Administrator to perform a nondiscretionary duty under the Act (the citizen suit provision). Plaintiffs alleged that the Corps and EPA failed or refused to assert regulatory authority over two separate tracts of land on the Albemarle-Pamlico Peninsula of coastal North Carolina.⁷ Jurisdiction was posited in the alternative on federal question jurisdiction,⁸ however, alleging violations of § 404 and the National Environmental Policy Act (NEPA).⁹

[19 ELR 10004]

Tract I

The Corps had told the developers of Tract I (addressed in Count I of the lawsuit), which consists of over 32,000 acres of "pocosins,"¹⁰ that it had no jurisdiction under § 404. Because the wetlands had been transected by large drainage ditches,¹¹ the Corps concluded that the tract had been drained, no longer consisted of wetlands, and therefore was not subject to the FWPCA's permit requirements. This decision, arrived at without public notice or an opportunity to comment, resulted in the Corps' denial of its jurisdiction over this vast and ecologically significant wetland expanse, and consequently there was no federal review of the environmental impacts of the proposed project.¹²

The Corps cameto this conclusion even though the area consisted largely of wetland vegetation rooted in hydric organic soils classified by government manuals as wetland soils. Moreover, evidence introduced by the plaintiffs demonstrated that, while the ditches may have caused some surface water runoff on the tract, the soils themselves were saturated and the water table remained very high because the deep muck peat soils underlying the tract were virtually incapable of being drained.¹³

Tract II

Tract II (addressed in Count II of the lawsuit) involved allegations of illegal tampering with the hydrology of some 4,000 acres of admitted wetlands, contained within a larger tract of 23,000 wetland acres, which was undergoing § 404 permit and NEPA review. The plaintiffs alleged that the Corps and private defendants had agreed that the private defendants could place plugs and pumps in certain canals on the property, which in turn would change the hydrological conditions on the parcel to the point where it could qualify for the nationwide "headwaters" permit.¹⁴ The [19 ELR 10005] plaintiffs alleged that the Corps, in closed-door discussions with the private defendants concerning Tract II, condoned this development on the 4,000-acre parcel during the pendency of the § 404 and NEPA review process.¹⁵

Resolution of the Issues

The parties settled Count II relatively early in the litigation. In return for allowing agriculture to continue on part of the 4,000 acres that had been ditched and cleared, the private defendants agreed to withdraw their pending application for the remaining 19,000 acres and to grant conservation easements and wildlife corridors over several hundred acres of the parcel to a resource agency approved by the plaintiffs. The remaining 19,000 acres, in addition to another 110,000 acres of wetlands on the peninsula owned by Prudential Insurance,¹⁶ were donated to the Fish and Wildlife Service and became the 420th component of the National Wildlife Refuge System, the Alligator River National Wildlife Refuge.¹⁷ Prudential Insurance had decided to get out of the wetland development business on the peninsula. The consent decree dismissed the government defendants with prejudice, but reserved the right of any party to petition for attorneys fees for work done on this count of the suit after the court adjudicated Count I.¹⁸

On Count I (regarding Tract I), the district court ruled that the Corps' determination of its jurisdiction over wetlands must be based on "sound scientific analysis of the vegetation, hydrology and soils employed after actual investigation into those factors."¹⁹ The court held that "since that analysis is lacking," the determination was arbitrary and capricious.²⁰ The court remanded the determination to the Corps for reexamination and enjoined the developers from engaging in any dredge or fill activities until a proper wetlands determination was made and any necessary permits were obtained.²¹

The Fee Litigation in the District Court

The plaintiffs filed a petition pursuant to FWPCA § 505(d) for the fees of their Washington, D.C., pro bono attorneys, members of a non-profit public interest law firm, and those of their experts. The petition requested fees from the defendants, making no distinction between government and private party defendants.²² While contending that they were entitled to fees under the FWPCA, plaintiffs moved, in the alternative, for fees pursuant to the Equal Access to Justice Act (EAJA).²³

The district court ruled that plaintiffs had prevailed on Count I, despite the defendants' contention that the ultimate issue — whether Tract I was wetlands — had not yet been decided on remand.²⁴ Because Count I sought to compel a duty that the district court had compelled — to make a reasoned wetlands determination properly analyzing soils, hydrology, and vegetation — the court concluded that plaintiffs had indeed prevailed on Count I. The court held that the plaintiffs had also prevailed on Count II, finding that the suit was a major factor in the developers' abandonment of the permit application and, while there was evidence that some negotiations were underway regarding the land donation prior to suit, that it was clear that the suit served as an impetus for the gift.²⁵ The court rejected the government's argument that the action was not one to compel a nondiscretionary duty. Attorneys fees were therefore available under the FWPCA.

The district court also held that the hours claimed by counsel were reasonable; that Washington, D.C., rates were appropriate even though the court sat in Raleigh, N.C.; and that counsel should be compensated at the highest rates of Washington, D.C., attorneys with similar experience and expertise, given the complexity of the issues and skill required, the results obtained, and the experience, reputation, and ability of counsel.²⁶ The court declined to hold the private defendants liable for any part of the fee award, finding generally that the private defendants only did what the government allowed them to do on the land.²⁷

Finally, the court rejected defendants' contention that because experts retained by plaintiffs did not testify orally in court at an evidentiary hearing but instead offered extensive affidavits in a supplemental record submitted by plaintiffs, expert fees were not appropriate. The court accordingly awarded those expert fees claimed, as well as costs of over $ 6,000.²⁸

[19 ELR 10006]

The Fee Litigation in the Fourth Circuit

The government appealed to the Fourth Circuit. It contended again that plaintiffs had not prevailed on Count I, regarding Tract I, because the Corps had not yet redetermined whether the tract was wetlands. It also argued that in any event, fees were not available under the FWPCA because the government had not failed to perform a non-discretionary duty under the Act, as it had indeed made a wetlands determination, and that was all, if anything, that was required of it. Neither were fees available under the EAJA, the government argued, because the Corps' position was substantially justified. On Count II, it contended that the plaintiffs had obtained no relief against it, but only against the private defendants, and that if fees were awarded on Count II, they ought to be paid by the private defendants.

Even if fees were available, the government contended, the district court erred in basing hourly rates on those of Washington, D.C., attorneys; in awarding rates at the highest end of the scale for Washington, D.C., attorneys;²⁹ in awarding expert fees; and in holding the government solely liable on both counts.³⁰ It did not argue in the district court, nor in its briefs on appeal, that 1986 rates were inappropriate for work performed in 1983-1986. That contention, based on a Supreme Court case decided before the government's last brief was filed in the district court fee litigation,³¹ it saved for oral argument.

Plaintiffs contended that on the central question of the case — the district court's jurisdiction under FWPCA § 505(a)(2) — the holding of the district court on the merits was res judicata. Because that issue was decided by the district court on the merits and the government did not appeal that decision, plaintiffs argued that the government was precluded from raising it in the fee litigation. In any event, plaintiffs said, jurisdiction was appropriate under § 505(a)(2), because the government could not simply ignore its jurisdiction or fail to investigate it rationally and thoroughly.

The government attempted to extricate itself from the res judicata charge by arguing that the case below had not yet concluded. It argued that the district court's judgment would not be final until the Corps redetermined its jurisdiction over Tract I. Because the judgment of the district court was not final, the government contended it could not have appealed the judgment and it could have no res judicata effect. Lest it be caught in the court of appeals without any jurisdiction, however, the government further contended that the doctrine enunciated by the Supreme Court in Cohen v. Beneficial Industrial Loan Corp.³² allowed it to appeal the district court's fee decision, even though the litigation as a whole was not over.³³

After oral argument, however, EPA finally determined that approximately 80 percent of Tract I was indeed wetlands, asserting its authority to make final jurisdictional determinations under the FWPCA.³⁴ In a letter to the court, the government suggested that the issue of the finality of the merits decision might now be moot because of that determination.

Plaintiffs responded that the issue was not moot, since the government was contending that it was not bound by the doctrine of res judicata. Thus, the plaintiffs urged, the court of appeals should either decide the jurisdictional issue or rule on the res judicata question.

The panel chose to decide the jurisdictional issue. In a major victory for citizen groups, it held that the suit was properly posited on FWPCA § 505(a)(2) and that the plaintiffs had obtained all of the relief they could under that cause of action.³⁵ The Corps had not made a reasoned wetlands determination although it had a nondiscretionary duty to do so. Moreover, the court put to rest a recurring government argument in § 404 cases that suit does not lie against the Corps under § 505 because that provision mentions only the EPA Administrator. Because the administration of § 404 clearly involves the regulatory authority of both the Corps and EPA, the court held, the Corps as well as EPA may be sued under § 505 when "the Corps abdicates its responsibility to make reasoned wetlands determinations and the Administrator fails to exercise the duty of oversight."³⁶

The court of appeals also upheld the district court's decision to use Washington, D.C., rates, noting that the government failed to controvert evidence introduced by the plaintiffs supporting the reasonableness of their retention of a Washington, D.C., public interest law firm.³⁷

Moreover, the panel rejected the government's contention that the district court in essence applied a multiplier and improperly considered factors such as the quality of the work, the attorneys' expertise and experience, and the results obtained to fix the appropriate rate. It saw things otherwise:

The district court did not err. In Blum, … the Court canvassed the legislative history of the Civil Rights Attorney's Fees Awards Act … and concluded that fee awards for nonprofit legal service organizations should be based on [19 ELR 10007] prevailing market rates. The district court followed Blum. It based its decision on prevailing market rates. It selected the upper end of these rates because the evidence disclosed that lawyers of comparable experience were compensated at the upper end of prevailing market rates.³⁸

The panel also disagreed with the government's contention that the private parties ought to pay. Those parties had a stake in the outcome of the litigation and they sought to protect their interests, the court said. "That fact does not warrant the assessment of attorneys fees against them, for if the Corps had fulfilled its duty to make a reasoned wetlands determination or if the Administrator of EPA had performed his duty the litigation would never have ensued."³⁹

Ramifications of Hanson

The decision in National Wildlife Federation v. Hanson is important for several reasons. Most important, the government has argued that the Supreme Court's decision in Middlesex County Sewerage Authority v. National Sea Clammers Association⁴⁰ deprives the courts of jurisdiction to entertain any private suits to enforce the FWPCA except as specifically authorized by the Act. The only private actions authorized by the FWPCA are those pursuant to § 505, the citizen suit provision, which the government contends did not authorize this suit, and § 509(b)(1), which allows suit directly in the courts of appeal by private parties challenging certain administrative determinations, none of which involve § 404.

While there is disagreement over whether Sea Clammers ought to be so interpreted, nevertheless the government continues to argue this view.⁴¹ If this position were to be adopted for review of FWPCA § 404 jurisdictional determinations, while at the same time citizens were not able to challenge Agency jurisdictional determinations under § 505(a)(2), citizens would have no avenue to ensure that the executive branch does not effect a wholesale repeal of the Act by refusing to exercise its jurisdiction.

Second, this is the first appellate court ruling on a long-standing government contention that the Corps cannot be sued under the § 505 citizen suit provision. The government has argued, in this case and others, that because § 505(a)(2) mentions only the EPA Administrator and does not specifically refer to the Corps or the Secretary of the Army, such an action cannot lie against the Corps. This decision should put that argument to rest.

Third, citizens will have a better chance of retaining counsel if, although uncompensated or meagerly so, counsel has some hope of later being compensated at prevailing community rates. Even if the government's position on Sea Clammers never gains any credence, and suits challenging wetland determinations can also be based on federal question jurisdiction, attorneys fees in such a cause of action would only be available under the EAJA. The likelihood of being capped at $ 75 per hour for work done on complex environmental litigation⁴² provides little incentive for private attorneys to represent citizens in public interest cases.

The last point is more obscure, but, nevertheless worthy of mention. The courts have put a judicial gloss on the fee shifting provisions of the environmental statutes to the effect that fees should seldom be awarded against private defendants.⁴³ This result, not intended by Congress, in the author's view, makes it necessary for citizen plaintiffs with meager resources to think hard about who to sue for violations of the FWPCA. For instance, the Corps may have determined that an area was not wetlands and so informed a developer in a pre-application consultation, an administrative step outlined in the Corps' regulations that may take place without public notice.⁴⁴ Subsequently, when the developer begins work, citizens may file suit against the developer for discharging in wetlands without a permit. If they are successful in convincing the court that a permit is required, will the court award fees against the private developer? It would seem that, now that the Fourth Circuit has resolved that jurisdiction under FWPCA § 505(a)(2) lies against the government in this situation, the better part of wisdom, at least with regard to attorneys fees, [19 ELR 10008] suggests that citizens ought to include the Corps as a defendant in such a suit under § 505(a)(2).

This avenue is not without consequence either, however. Chances are great that if the action were brought solely against the private developer under FWPCA § 505(a)(1), even in the face of a defendant's argument that the Corps had given it the go-ahead, the cause would heard de novo. If the Corps is also sued as a party defendant under § 505(a)(2), however, the action may be heard on the record of the Corps' determination that the area was not wetlands, if a record can be said to exist in the circumstances of a pre-application consultation, and may be reviewed under the arbitrary and capricious standard.⁴⁵

Under the first scenario, plaintiffs would be able to introduce evidence as to the character of the tract, and the court would determine de novo whether the tract is a navigable water for purposes of the FWPCA. In the second scenario, a court might well simply remand the case to the Corps for a redetermination. In Hanson, if EPA had not determined that Tract I presented a "special case," and abrogated the Corps' redetermination on remand that Tract I was not comprised of wetlands, the Corps' determination on remand would have been final. Plaintiffs would then have been faced with the decision whether to file suit again to challenge that determination.⁴⁶

Conclusion

As a result of the Fourth Circuit's decision in National Wildlife Federation v. Hanson, citizens now have a clear avenue to challenge the Corps of Engineers' wetlands determinations under the FWPCA's citizen suit provision. In addition to dispelling the confusion that the government has created concerning the proper jurisdictional basis for such challenges, Hanson provides that counsel for citizens may be awarded attorneys fees at prevailing community rates when these challenges are successful. Both results reinforce the watchdog role that Congress intended citizens to have when it added the citizen suit provision to the FWPCA in 1972.

1. National Wildlife Federation v. Hanson, 18 ELR 21509 (4th Cir. Oct. 14, 1988), aff'g and vacating in part 18 ELR 20008 (E.D.N.C. Oct. 1, 1987). The court granted the government's motion for an extension until November 28, 1988, to file a petition for rehearing and a suggestion of rehearing en banc.

The decision of the district court on the merits of the case is reported at 623 F. Supp. 1539, 16 ELR 20388 (E.D.N.C. 1985).

2. 33 U.S.C. § 1344, ELR STAT. FWPCA 054.

3. The total area involved was over 58,000 acres.

4. The local groups are the North Carolina Wildlife Federation, the North Carolina Fisheries Association, the Pungo River Association, the Pamlico-Tar River Foundation, the Conservation Council of North Carolina, and the Stumpy Point Civic Club.

5. Hanson, 18 ELR at 21510.

6. Both the Corps and EPA must also interpret other terms for regulatory purposes under § 404, such as dredged or fill material, point source, discharge, and the like, in order to ascertain their jurisdiction.

7. The two tracts of land encompassed tens of thousands of acres of wetlands critical to the health of the North Carolina estuary. The tracts are situated on a peninsula that lies directly to the west of the famous North Carolina Outer Banks, surrounded by the Albemarle and Pamlico Sounds. See generally, U.S. FISH & WILDLIFE SERVICE, THE ECOLOGY OF SOUTHEASTERN SHRUB BOGS (POCOSINS) AND CAROLINA BAYS: A COMMUNITY PROFILE (1982) [hereinafter THE ECOLOGY OF SOUTHEASTERN SHRUB BOGS], and U.S. FISH & WILDLIFE SERVICE, NATURAL AND MODIFIED POCOSINS: LITERATURE SYNTHESIS AND MANAGEMENT OPTIONS (1983) [hereinafter NATURAL AND MODIFIED POCOSINS].

Although the district court did not decide that Tract I was composed of wetlands, EPA has determined that approximately 80 percent of this tract consists of wetlands regulated under the FWPCA. See Environmental Protection Agency, Determination of Wetlands Jurisdiction Under Section 404 of the Clean Water Act, First Colony Farms Tract I (Aug. 1, 1988) [hereinafter Jurisdictional Determination]. Under a 1980 Memorandum of Understanding between EPA and the Corps, EPA has given the Corps authority to make final jurisdictional determinations of navigable waters in all but certain "special cases." Memorandum of Understanding, Geographical Jurisdiction of the Section 404 Program, 45 Fed. Reg. 45018 (July 2, 1980). Navigable waters are defined as waters of the United States, including the territorial seas, in FWPCA § 502(7), 33 U.S.C. § 1362(7), ELR STAT. FWPCA 058.

After its decision on the merits, the district court in Hanson remanded the case to the Corps. 623 F. Supp. at 1548, 16 ELR at 20393. The Corps again determined that Tract I was not composed of any wetlands. EPA subsequently asserted its authority to make the final jurisdictional determination, however, having decided that this tract presented a "special case." 53 Fed. Reg. 33544 (Aug. 31, 1988). That Tract II consists of wetlands was never in dispute in the litigation.

8. 28 U.S.C. § 1331.

9. The Corps and EPA were defendants in both counts of the lawsuit. Peat Methanol Associates and First Colony Farms were private defendants in Count I; Prulean Farms, a joint venture between First Colony Farms and Prudential Insurance Company, was a defendant in the second count. The developers of Tract I originally intervened in Count I and plaintiffs amended the complaint to allege a cause under FWPCA § 505(a)(1) directly against them for the unpermitted discharge of dredge or fill material. Subsequently, plaintiffs added the developers of Tract II to the suit for the same alleged violation.

10. Much of the peninsula's natural habitat consists of thick evergreen shrub bogs called "pocosins," the Algonquin Indian term for "swamps on a hill." Pocosins are freshwater wetlands occurring on the southeastern coastal plain; they typically have highly developed organic or peat soils. They are created by the process of paludification (bog expansion caused by a rising of the water table as peat accumulates), which has gone on for thousands of years. They once comprised more than two million acres in North Carolina alone. Pocosins are found in shallow basins on divides between ancient rivers and sounds. See RICHARDSON, POCOSIN WETLANDS 3-5 (1981); see also ECOLOGY OF SOUTHEASTERN SHRUB BOGS AND NATURAL AND MODIFIED POCOSINS, supra note 7.

These wetlands provide abundant water retention capacity and act as storm buffers by greatly reducing flood peaks and by preventing the rapid influx of fresh water and excess nutrients into saline estuarine areas, which would severely damage the fisheries. Pocosins absorb mercury and other heavy metals from the atmosphere and render them insoluble, thus removing heavy metals from potential concentration within the food chain. They also provide a natural sink for carbon storage, holding a significant portion of the world's carbon in delicate balance. They are the natural habitat not only of species that have always been restricted to pocosins, but are also refuges for native species that once ranged widely but are now confined to pocosins because they are among the last habitats to be destroyed by human activity. They provide a home for a variety of game birds and mammals, furbearers, and fish in the coastal plain, and are the last stronghold for the black bear in coastal North Carolina. See Complaint, P31, National Wildlife Federation v. Hanson, 623 F. Supp. 1539, 16 ELR 20388 (E.D.N.C. 1985), (No. 83-1288-CIV-5); see also ECOLOGY OF SOUTHEASTERN SHRUB BOGS and NATURAL AND MODIFIED POCOSINS, supra note 7.

11. The private defendants proposed to "harvest" these ancient peat bogs and convert the peat to methanol in an as-yet-to-be-designed peat-to-methanol plant. They were guaranteed a price for the methanol by the now defunct Synfuels Corporation of twice the spot-market value of methanol then prevailing. Although the Synfuels Corporation had granted the private defendants close to $ 500 million in loan and price guarantees at the time this lawsuit was filed, the project's replicability and viability was in serious doubt and was later abandoned. See U.S. GENERAL ACCOUNTING OFFICE, REPORT TO THE CHAIRMAN, SUBCOMMITTEE OF OVERSIGHT AND INVESTIGATIONS, COMMITTEE ON ENERGY AND COMMERCE, HOUSE OF REPRESENTATIVES, CIRCUMSTANCES SURROUNDING THE FIRST COLONY PEAT-TO-METHANOL PROJECT (1984).

It was unclear from the record compiled by the Corps whether some of the drainage ditches had been excavated after the FWPCA's prohibitions against discharging dredged or fill material became applicable to wetlands. It appeared from the record that at least most of the ditching occurred in the early 1970s. As to future activity, however, there was no dispute. The private defendants admitted that the activities they proposed for the tract would result in the discharge of dredged or fill material to the pocosins.

12. Plaintiffs alleged that the effects of this vast development project could be catastrophic to the North Carolina estuary. Many others agreed, including EPA. Citing the "significant potential for environmental damage," EPA stated that "[t]he peat mining has created some serious questions about environmental effects, the most notable of which are the concentration of mercury in run-off water and the potential impacts of the mercury and other pollutants on the marine fisheries downstream." Exhibit A to Appendix C to Plaintiffs' Reply to Defendants' Response to the Supplemental Record, National Wildlife Federation v. Hanson, 623 F. Supp. 1539, 16 ELR 20388 (E.D.N.C. 1985) (No. 83-1288-CIV-5). Then Assistant Secretary of the Interior for Fish and Wildlife, Ray Arnett, concurred:

The loss of these wetlands would reduce the quality of water entering the local rivers and estuaries thereby adversely affecting fish and wildlife populations. Water discharged from the proposed pumping of surface and groundwater supplies has been shown, by [Peat Methanol Associates], to exceed State water quality standards for some parameters, especially that of mercury…. Following mining, the project area is proposed to be converted to row crop agriculture. Farming will result in increases in sediment loads, nutrients, and pesticides and could result in eutrophication of downstream aquatic systems. The combined effect of these water quality impacts could be a substantial reduction in the valuable, commercial ($ 63.8 million in 1982) and sport (approximately $ 45.0 million in 1980) fisheries of the area.

The proposed quantities of water from pumping ground and surface waters associated with this project are considerable…. [P]umping at the project site would reduce water levels, thereby adversely affecting adjoining wetlands. Pungo [National Wildlife Refuge], which is adjacent to the project area, would be severely impacted by resultant habitat alterations that would limit wildlife management options…. [H]azardous wastes may be generated by the peat to methanol conversion process.

Exhibit C to Appendix C to Plaintiffs' Reply to Defendants' Response to the Supplemental Record, National Wildlife Federation v. Hanson, 623 F. Supp. 1539, 16 ELR 20388 (E.D.N.C. 1985) (No. 83-1288-CIV-5).

13. 623 F. Supp. at 1541, n.2, 16 ELR at 20389, n.2.

14. The Corps' regulations require that for individual § 404 permits the Corps must provide public notice and an opportunity to comment. In its decision whether to issue a permit, the Corps must abide by EPA's Guidelines for Specification of Disposal Sites for Dredged or Fill Material, promulgated pursuant to FWPCA § 404(b)(1). 40 C.F.R. pt. 230 (1987) [hereinafter Guidelines]. The discharge of dredged or fill material to wetlands is also permitted, however, under certain nationwide permits (a type of general permit authorized by § 404(e)(1)). 33 C.F.R. pt. 330 (1987). These permits do not, in many cases, require either public notice or the application of the § 404(b)(1) Guidelines prior to the discharge. Indeed, this particular permit, known as the nationwide "headwaters" permit, authorized, at the time of the Corps' and private defendants' actions in this case, the discharge of dredged or fill material to wetlands "above the headwaters" (the point on a nontidal stream above which the average annual flow is less than five cubic feet per second) with neither notice nor application of the Guidelines. 33 C.F.R. §§ 323.2, 330.4(a)(1) (1982).

15. See National Wildlife Federation v. Hanson, 18 ELR at 20009, for the district court's discussion of the allegations and the resolution of this count of the suit.

16. See supra note 9.

17. See National Wildlife Federation v. Hanson, 623 F. Supp. 1539, 16 ELR 20388 (E.D.N.C. 1985) (reporting on consent decree entered Mar. 19, 1984).

The red wolf is being reintroduced into this natural wilderness area of shrubby bogs, Atlantic white cedar swamps, and brackish and freshwater marshes. The first group of six wolves is intended to be the nucleus for a population that vanished from the wild within the last decade. Horan, The Red Wolf Is Coming Home, DEFENDERS, May/June 1986, at 4.

18. See National Wildlife Federation v. Hanson, 623 F. Supp. 1539 (E.D.N.C. 1985) (reporting on consent decree entered Mar. 19, 1984).

19. 623 F. Supp. at 1548, 16 ELR at 20392.

20. Id.

21. National Wildlife Federation v. Hanson, No. 83-1288-CIV-5 (E.D.N.C. Dec. 20, 1985) (order remanding to Corps).

22. At this stage of the litigation, there were five party defendants: the Corps, EPA, First Colony Farms, Peat Methanol Associates, and Prudential Insurance Company. The joint venture (Prulean Farms) had been dissolved. See supra note 9. It was plaintiffs' judgment that the court could apportion fees in any way it deemed just.

23. 28 U.S.C. § 2412, ELR STAT. ADMIN. PROC. 010. Under the EAJA, fees are available only against the government. Although they presented the requisite jurisdictional evidence and filed their petition within the time prescribed by the EAJA, plaintiffs did not brief their entitlement under the EAJA because they believed that they were entitled to fees under the FWPCA. Moreover, the EAJA is considerably less advantageous for plaintiffs than other fee shifting provisions. Not only does the EAJA cap hourly rates at $ 75 per hour, a rate well below those of most experienced attorneys practicing in large metropolitan areas, but if the government can convince a court that it was "substantially justified" in taking the position challenged, it can escape liability for fees altogether. See Pierce v. Underwood, 487 U.S. __, 108 S. Ct. 2541 (1988).

24. 18 ELR at 20009.

25. 18 ELR at 20009-10.

26. 18 ELR at 20010-11. The fee case was submitted to the district court in June 1986; the court issued its decision in October 1987. The court awarded rates ranging from $ 45 per hour for law clerks to $ 250 per hour for counsel with over 20 years' experience, relying on evidence introduced by plaintiffs of rates charged by Washington, D.C., law firms for legal services performed by attorneys with similar expertise and experience during 1986.

27. 18 ELR at 20009.

28. 18 ELR at 20011. The costs included filing fees; long-distance telephone calls; costs of scientific books, treatises, and maps; overnight delivery and other postage; travel; and copying expenses.

29. Quite amazingly, the government argued that public interest law firms ought not be compensated at rates comparable to those garnered by large private Washington, D.C., law firms. It relied on the reasoning and holding in New York Association for Retarded Children v. Carey, 711 F.2d 1136, 1148, 1151 (2d Cir. 1983), to the effect that hourly rates awarded to non-profit law firms ought to be based on costs rather than on prevailing community rates. That decision was discredited, however, by the Supreme Court in Blum v. Stenson, 465 U.S. 886 (1984).

30. On appeal, the government did not press its contention that the hours claimed were unreasonable.

31. Library of Congress v. Shaw, 478 U.S. 310 (1986).

32. 337 U.S. 541 (1979).

33. In Cohen, the Supreme Court was faced with an appeal of a district court decision denying defendant's motion in a stockholder's derivative suit, brought pursuant to the court's diversity jurisdiction, to require the plaintiff to post security withthe court to pay attorneys fees and costs in the event the suit was not successful. The collateral was required by state statute. The Court heard and decided the appeal, interpreting 28 U.S.C. § 1291 as allowing an appeal "from a small class of situations which finally determine claims of right separable from and collateral to rights asserted in the action, too important to be denied review and too independent of the cause itself to require that appellate consideration be deferred until the whole case is adjudicated." Id. at 546-47.

34. Jurisdictional Determination, supra note 7.

35. 18 ELR at 21511.

36. 18 ELR at 21510.

37. Plaintiffs had introduced evidence that the Raleigh, N.C., office of the National Wildlife Federation was not large enough to handle complex federal court litigation; that another public interest law firm had declined the case; and that Washington, D.C., was the closest community with attorneys who not only had the requisite experience and expertise to handle the litigation but who were also willing to take the case without compensation. See 18 ELR at 21511.

38. Id. (citations omitted). The panel did not address another of the government's arguments, posited in a footnote in its opening brief, that expert witness fees were inappropriate. The district court's ruling on this issue thus stands. See National Wildlife Federation v. Hanson, 18 ELR at 20011.

39. 18 ELR at 21511-12. The court also held that although the government did not assert until oral argument that the district court had erred by using current instead of historic rates, it could consider the issue because the error was "plain." Because the Supreme Court had held in Library of Congress v. Shaw, 478 U.S. 310, that traditional government immunity barred an award of interest or other compensation for delay against the government, the panel vacated that part of the district court's decision that used 1986 rates and remanded for recomputation of the lodestar on the basis of historical rates. "Following the Supreme Court's reasoning in Shaw, we hold that current rates may not be used when computing attorneys fees to be paid by the government." 18 ELR at 21511 (citing Thompson v. Kennickell, 836 F.2d 616, 619 (D.C. Cir. 1988)).

40. 453 U.S. 1, 11 ELR 20684 (1981).

41. See, e.g., J.A. 301-303, National Wildlife Federation v. Hanson, 18 ELR 21509 (4th Cir. 1988) (No. 87-3183); Oregon Natural Resources Council v. United States Forest Service, 834 F.2d 842, 850, 18 ELR 20450, 20455 (9th Cir. 1987); Memorandum in Support of Federal Defendants' Motion to Dismiss or for Summary Judgment 20-25, National Wildlife Federation v. Laubscher, 662 F. Supp. 548, 17 ELR 20892 (S.D. Tex. 1987) (No. G-86-37). But see Golden Gate Audubon Society, Inc. v. United States Army Corps of Engineers, 18 ELR 21401 (N.D. Cal. May 6, 1988, amended June 20, 1988), where the government argued just the opposite (that there is federal question jurisdiction in actions by citizens to enforce the FWPCA) after the district court initially found that it had jurisdiction over a Corps' wetland determination under § 505(a)(2).

42. This is not to say that the courts have not awarded more than the statutory cap. See, e.g., Oregon Environmental Council v. Kunzman, 14 ELR 20762 (D. Or. Aug. 9, 1984) (limited availability of qualified environmental attorneys and length of time attorneys waited for compensation justify increase over EAJA cap); United States v. Ottati & Goss, 18 ELR 20771 (D.N.H. June 24, 1987) (expertise, inflation justify increase). But such an increase is by no means routine. Pierce v. Underwood, 487 U.S. __, 108 S. Ct. 2541 (1988).

43. See, e.g., Ruckelshaus v. Sierra Club, 463 U.S. 680, 692 n.12, 13 ELR 20664, 20667 n.12 (1983), in which the Court stated

[w]e do not mean to suggest that private parties should be treated in exactly the same manner as governmental entities. Differing abilities to bear the cost of legal fees and differing notions of responsibility for fulfilling the goals of [environmental laws] likely would justify exercising special care regarding the award of fees against private parties.

See also Natural Resources Defense Council, Inc. v. Thomas, 801 F.2d 457, 461-62 & n.2, 16 ELR 20960, 20961-62 & n.2 (1986) (relying on dictum in Ruckelshaus, the court denied fees for time spent on contentions made by intervening private defendants, even though plaintiff had prevailed on all of its arguments and there was not question that it had served the public interest in bringing the suit).

44. See 33 C.F.R. § 325.1(b) (1987). Indeed, that is precisely what occurred with Tract I in this litigation.

45. See, e.g., Avoyelles Sportsmen's League v. Marsh, 715 F.2d 897, 13 ELR 20942 (5th Cir. 1983) (review of government's wetland determination on the record under the arbitrary and capricious standard). But see National Wildlife Federation v. Gorsuch, 530 F. Supp. 1291, 12 ELR 20268 (D.D.C.), rev'd on other grounds, 693 F.2d 156, 13 ELR 20015 (D.C. Cir. 1982) (in an FWPCA § 505(a)(2) action against EPA, district court determined after a trial de novo that dams are point sources under the FWPCA); South Carolina Wildlife Federation v. Alexander, 457 F. Supp. 118, 126-27, 8 ELR 20757, 20761 (D.S.C. 1978) (court holds that it does not matter whether EPA determines that a dam is or is not a point source; if citizen plaintiffs can prove at trial that it is, a permit will be required of the dam operator (here, the Corps) under the FWPCA).

46. See supra note 7.