Two Circuits Scuttle Expansion of Federal Common Law

Overlooked for many years as an enforcement tool, the doctrine of federal common law of water pollution rocketed to national prominence following the Supreme Court's historic decision in Illinois v. City of Milwaukee.¹ Although the Court declined to exercise its original jurisdiction over the allegation by Illinois that Milwaukee caused a public nuisance by its discharge of raw sewage into Lake Michigan, it did hold that the word "laws" in the federal question statute, § 1331(a),² embraces federal court-created common law. It also found that federal district courts have jurisdiction to entertain claims by states (and perhaps others) that a defendant's discharges into "interstate or navigable waters" create a public nuisance.

Questions Left Open by Illinois

The Illinois decision initiated a flurry of litigation under federal common law, in most of which United States attorneys sued an industrial or municipal discharger.³ These cases were a brief phenomenon, however, being quickly overshadowed by enactment of the Federal Water Pollution Control Act Amendments of 1972 (FWPCA)⁴ on October 18, 1972, a mere six months after the Supreme Court announced Illinois. Federal efforts then shifted toward implementation of the new statute's regulatory scheme and away from costly and laborious suits against individual dischargers.

Despite their brief tenure, these faderally-initiated suits answered one issue left open by Illinois, i.e., whether the federal government can employ federal common law in water pollution abatement actions. Apart from dicta in one case,⁵ district courts have uniformly found that the federal government may prosecute water pollution actions using federal common law.⁶ The seemingly contrary dicta in the Eighth Circuit's decision in Reserve Mining Co. v. EPA,⁷ that the United States was "unwise" to rely on federal common law as a basis for its claim against Reserve, is discounted by the court's holding that relief in that case appropriately rested on provisions of the FWPCA of 1970⁸ and the Refuse Act.⁹

Another issue not resolved by Illinois, whether a defendant located in the federal district of the plaintiff can be sued in a federal common law nuisance action, was answered in the affirmative by one circuit and several district courts. Stream Pollution Control Board v. United States Steel Corp.¹⁰ involved a claim by Indiana that the resident corporation was illegally discharging pollutants into the Grand Calumet River, an intrastate stream that empties into Lake Michigan. Writing for the Seventh Circuit, Judge (now Justice) Stevens held, without mentioning that defendant's discharges occurred in plaintiff's federal judicial district, that the district court properly assumed jurisdiction over the case. Similarly, district courts in Illinois¹¹ and Vermont¹² have assumed jurisdiction over cases in which the United States sued to abate discharges by resident corporations into the intrastate waters of, respectively, Lake Michigan and Lake Champlain, both of which are interstate bodies of water.

Writing for the Supreme Court in Illinois, Justice Douglas raised another issue that implied the possible elimination of federal common law actions to abate water pollution: "It may happen that new federal laws and new federal regulations may in time pre-empt the field of federal common law of nuisance."¹³ The implication that the FWPCA preempts federal common law actions was rejected, however, by the district court hearing the Llinois case on remand from the Supreme Court¹⁴ and by two other district courts.¹⁵

Two other significant questions raised by Illinois have been probed but not answered by subsequent cases brought under federal common law. The first issue [6 ELR 10257] arises from Justice Douglas' hint that parties in addition to states might be able to bring federal common law actions cognizable by the district court: "Thus, it is not only the character of the parties which requires us to apply federal law."¹⁶ An affirmative answer to this question was assumed without discussion by the court in Byram River v. Village of Port Chester¹⁷ when it took jurisdiction over an environmental group's claim¹⁸ that the defendant polluted the interstate waters of the Byram River with discharges from its sewage treatment plant.

The second unanswered issue is one of scope: whether actions under federal common law reach only controversies involving pollution of interstate waters. Justice Douglas never addressed the precise question, but he nevertheless carefully included the modifier "navigable" along with "interstate" in describing the waters protected by federal common law. The Seventh Circuit, in Stream Pollution Control Board, noted that Justice Douglas' grammatical precision might imply that the federal interest in interstate water purity justifies nonstatutory federal protection of all navigable tributaries, but held that resolution of the issue was unnecessary to predicate jurisdiction in the district court over Indiana's claim under federal common law.

Decisions in the Fourth and First Circuits

These two unanswered questions raised by Illinois have been addressed in two recent decisions that may cast a pall over the future utility of federal common law actions to abate water pollution.The Fourth Circuit, in Committee for the Consideration of Jones Falls Sewage System v. Train.¹⁹ affirmed the district court's finding that federal common law does not grant a citizen group the right to enjoin intrastate pollution caused by a sewage treatment plant outfall operating under a permit issued pursuant to the FWPCA. Jones Falls Stream, a Maryland river which eventually flows into the Chesapeake Bay, is occasionally polluted by raw sewage discharged from the Jones Falls Sewage System treatment plant, which is run by the City of Baltimore. The Committee, which consists of citizens living near the stream, sought to abate the discharge through imposition of a sewer hookup moratorium, but were thwarted by a permit application filed by Baltimore city officials, which, under § 402(k) of the FWPCA,²⁰ exempted the treatment plant from prosecution. The Environmental Protection Agency eventually issued the permit. Recognizing that its claim under the FWPCA was moot, the Committee amended its complaint to include a claim for an injunction under federal common law, pointing to the absence of any means of relief under the Act.

Chief Judge Haynsworth, writing for a five-man majority, declared that the Illinois doctrine cannot, with the possible exception of suits by the United States, be extended to reach beyond "the abatement of public nuisances in interstate controversies where the complainant is a state and the offenders are creating extra-territorial harm."²¹ Specifically, he held that the local scope of the controversy precluded any federal interest beyond that expressed in the FWPCA. He emphasized that state remedies were available to the plaintiff and read § 505(e),²² the FWPCA's savings clause, to recognize the continuing validity only of state common law nuisance actions. Judge Haynsworth drew further support from the Eighth Circuit's Reserve Mining decision for the proposition that interstate effects must be alleged to sustain a federal common law claim. The majority also stressed the anomaly of allowing federal common law to prohibit conduct that is explicitly permitted under a federal statute.

Judge Butzner, writing in dissent with two other judges, vigorously attacked both the conclusion and reasoning of the majority, asserting that the Committee alleged a claim cognizable by the district court. Analyzing the expanded federal role in water pollution control brought about by the FWPCA, he argued that the citizen suit provisions in § 505 of the Act demonstrate that pollution of navigable, not just interstate, waters raises a federal question to which all federal law, including common law, is applicable. Specifically, he pointed out that § 505(e) on its face is broad enough to save actions under federal common law.

Furthermore, Judge Butzner viewed Illinois v. City of Milwaukee as not expressly limited to actions by states or actions concerning only interstate waters. Such limitations would confuse parties with subject matter and would frustrate the intent of Congress that clean water be achieved not only through statutory mechanisms but also through citizen suits, under complementary common law, seeking relief not available under the Act. The judge interpreted Illinois to grant federal question jurisdiction under § 1331(a) to the district courts in water pollution disputes because of the federal nature of water pollution, not simply because the suit is brought by a state. He also would have reserved for trial the defendants' suggestion that the FWPCA preempts federal common law actions because the role of the common law is to fill statutory interstices and provide uniform decisions in questions of federal scope. Filing suit in state court would frustrate both purposes, since the Act expressly allows for actions under federal common law for relief not contemplated in the statute and state decisions cannot practicably achieve national uniformity.

[6 ELR 10258]

Finding neither jurisdictional nor substantive barriers to the common law claim. Judge Butzner would have analyzed the suit's validity in terms of the plaintiffs' standing. He would have determined that the plaintiffs satisfied the Sierra Club v. Morton²³ injury in fact test by virtue of their living next to the Jones Falls Stream. Moreover, this standing would also have satisfied the objection that private persons cannot abate a public nuisance, since the requisite personal stake in the litigation distinguishes the plaintiffs' harm from the generalized harm to the national resource of the Chesapeake Bay suffered by the public at large.

In the other recent decision inhibiting federal common law actions, Massachusetts v. United States Veterans Administration.²⁴ the First Circuit held that the state's failure to comply with the 60-day notice limitation of § 505(b) of the FWPCA barred a nonstatutory action against the federal agency on the grounds of sovereign immunity. Massachusetts alleged that the Veterans Administration hospital in Bedford violated its NPDES permit deadlines by not connecting with the municipal sewage system, a charge the Veterans Administration admitted. However, Massachusetts filed suit to restrain the violation only 40 days after giving notice of its intent to file suit. The court held that the jurisdictional failure was not cured by "substantial compliance" with the notice requirement, even though Massachusetts had persuasively argued that no amount of administrative action could redress the Veterans Administration's failure to meet its tie-in deadlines.

Acknowledging, but not deciding, the plaintiff's federal common law claim, Chief Judge Coffin declared that the federal government had waived its sovereign immunity only through the citizen suit provision of the FWPCA and affirmed the district court's dismissal. The court's discussion, however, contains extensive dicta to the effect that the common law claim would fail even if it were properly before the court. Noting that Massachusetts did not base its nuisance allegations on damage to the Commonwealth, but rather on a violation of the Act, the court merely acknowledged the current conflict in the circuits as to whether § 1331(a) independently grants jurisdiction to district courts to hear violations of the FWPCA. Also, the court cited Jones Falls, against the contrary authority of Judge Stevens' Stream Pollution Control Board decision, for the proposition that federal common law probably does not extend to pollution originating within the territorial jurisdiction of the plaintiff. Finally, the court inexplicably read Illinois v. City of Milwaukee as authority for the assertion that § 505(h) of the later-enacted FWPCA of 1972,²⁵ which authorizes governors to compel the EPA Administrator to abate a permit violation in another state, may preempt portions of the federal common law of nuisance.

Critique of the Decisions

It is not difficult to predict that Jones Falls and Massachusetts v. VA will cumulatively discourage an appropriate expansion of the use of federal common law to plug enforcement gaps in the FWPCA. However, the decisions are open to criticism for their analysis of judicial precedents and statutory language, as well as for their fundamental misconception of the role of the federal common law in the context of a complicated statutory scheme.

The starting point for a conceptual critique is the proposition that Congress did not intend the FWPCA to be the sole or even the ultimate federal answer to water pollution control. Justice Douglas in Illinois v. City of Milwaukee, referring to the less federally-oriented FWPCA of 1970, said "the remedies which Congress provides are not necessarily the only federal remedies available…. When we deal with air and water in their ambient or interstate aspects, there is federal common law…."²⁶ The underlying thesis of the majority in Jones Falls, on the other hand, viewed permits granted under the FWPCA as absolute ceilings for pollution controls. Even a rudimentary acquaintance with the statute reveals the fallacy in this viewpoint. Permits can be altered to meet water quality standards necessary to attain the FWPCA's 1983 goal of "fishable, swimmable" water.²⁷

A corollary of the majority's reliance on FWPCA permits as a ceiling is a restrictive interpretation of Illinois; the assertion that a circumscribed FWPCA represents the extent of federal interest in water pollution leaves very little room for development of a federal common law. The majority's atatement that the reach of the Illinois doctrine has not been judicially extended, with the exception of federal suits, beyond state protection of interstate pollution is plainly wrong. The Seventh Circuit in Stream Pollution Control Board approved the district court's taking federal question jurisdiction over the case involving discharges into intrastate waters and two other district courts have similarly taken jurisdiction over water pollution controversies not dependent on interstate effects of the pollution.²⁸ Moreover, private parties were able to raise common law claims in the Byram River litigation.²⁹ Thus, courts have not read Illinois as restricted only to states complaining about pollution of interstate waters.

There may, however, be a way for future, litigants to circumvent the Fourth and First Circuits' restricted reading of federal common law. Judge Haynsworth for the Fourth Circuit noted that the plaintiff had not alleged any interstate effect of the Jones Falls Sewage System discharge. Similarly, Judge Coffin for the First Circuit gave no indication that Massachusetts had claimed harm to another state by the Veterans Administration hospital's permit violation. Curing this pur ported jurisdictional defect would merely involve including an allegation that any discharge into an intrastate tributary of the navigable water necessarily affects interstate waters.

A court that would accept such an allegation as establishing [6 ELR 10259] federal question jurisdiction would be compelled, however, also to accept the force of Judge Butzner's dissent in Jones Falls that federal common law reaches all navigable waters rather than just interstate waters. Indeed, the recognition that water pollution does not respect state boundaries is one of the FWPCA's conceptual bases. Thus, as the dissent in Jones Falls argued, the federal interest in the purity of navigable waters, as expressed in the general policy of § 101(a) of the FWPCA,³⁰ requires the application of federal common law to intrastate controversies where the relief requested does not fit the precise remedies specified in any statute.

The inquiry, therefore, must devolve to the question of whether the statutory scheme comprises the entire spectrum of remedies available to implement congressional policy for the elimination of water pollution, i.e., whether the FWPCA supplants or preempts federal common law. Contrary to the courts that have directly considered the question,³¹ the First Circuit suggested that the FWPCA does constitute such a preemption of federal common law. More serious, however, is the strange reading by the Fourth Circuit of the FWPCA's provision that indicates congressional intent on the preemption issue, the savings clause of § 505(e). Judge Haynsworth judicially amended the statute by reading § 505(e) to save only state nuisance law claims, thus impliedly holding that the FWPCA preempts federal common law.

He have, and could have given, no reason for this unusual interpretation. The legislative history is silent on whether Congress meant to supplant the rule in Illinois v. City of Milwaukee. In fact, the House and Senate reports on § 505(e) merely repeat, rather than explain, the provision.³² Thus, the hoary rule of construction can be invoked to hold that Congress, having notice of the Supreme Court's decision in Illinois, chose to incorporate rather than reject it. Moreover, the Second³³ and District of Columbia³⁴ Circuits have construed § 505(e) to evidence a congressional desire to expand, instead of diminish, the federal judicial power over water pollution controversies. Finally, analogizing from the Supreme Court's recent dissatisfaction with implied preemption of state laws by federal statutes,³⁵ Congress' failure specifically to eliminate federal common law actions requires that an accommodation between statutory and nonstatutory remedies be made.

Nature of the Accommodation

Not even the most optimistic proponents of the federal common law of nuisance have gone so far as to argue that it should replace statutory schemes and remedies. But where there exists a federal interest, such as in navigable waters, and a congressional policy that has been frustrated through either statutory incompleteness, administrative recalcitrance, or, as in Jones Falls, the common sense notion that raw sewage ought not to flow unremedied, federal common law is available as a stopgap.

Judge Butzner, dissenting in Jones Falls, reiterated the two functions of federal common law noted in Illinois: to fashion a uniform rule of decision and to fill statutory interstices. These functions have not lost force with the passage of the FWPCA. Indeed, in a federal system of water pollution control, there is no jurisdictional reason why private parties as well as states cannot implement federal policy through the courts. The existence of a federal common law permits the most uniform protection of waters, because when it is raised even in a state court proceeding, federal common law supplants local law.³⁶

Some usual jurisdictional and practical barriers, however, will temper the use of the new federal common law by private parties. The Eleventh Amendment by its terms bars such suits against other states and, as construed, bars such suits against the plaintiff's state,³⁷ although there may be some erosion of the Supreme Court's support for the latter proposition.³⁸ In addition, the decisions have not yet solidified into a trend holding that pollution of navigable waters automatically satisfies the jurisdictional dollar amount required under § 1331(a),³⁹ although Illinois settled that pollution of interstate waters satisfied that requirement.⁴⁰ Naturally, any plaintiff must satisfy the standing tests, but, as Judge Butzner pointed out, a private litigant who satisfies the Sierra Club v. Morton⁴¹ injury in fact test automatically defeats the traditional incapacity of private parties to sue to abate public nuisances. Finally, the substantial proof problems traditionally associated with common law suits, compared with proof of a permit violation under the FWPCA, may limit the attractiveness of common law actions in an age of reliance on statutory enforcement.

1. 406 U.S. 91, 2 ELR 20201 (1972), noted in 49 Denver L.J. 609 (1973), 52 Neb. L. Rev. 301 (1973), 7 Suffolk U.L. Rev. 790 (1973) See also Garton, The State Versus Extraterritorial Pollution — States' "Environmental Rights" Under Federal Common Law, 2 Ecology L.Q. 313 (1972); Comment, Federal Common Law and the Environment: Illinois v. Milwaukee, 2 ELR 10168 (Aug. 1972); Comment, Federal Common Law in Interstate Water Pollution Disputes, 1973 U. Ill. L.F. 141; Comment, The Expansion of Federal Common Law and Federal Question Jurisdiction to Interstate Pollution, 10 Houston L. Rev. 121 (1972).

2. 28 U.S.C. § 1331(a) provides:

The district courts shall have original jurisdiction of all civil actions wherein the matter in controversy exceeds the sum or value of $10,000, exclusive of interests and costs, and arises under the Constitution, laws, or treaties of the United States.

3. United States v. Reserve Mining Co., 380 F. Supp. 11, 4 ELR 20573 (D. Minn. 1974), modified and remanded sub nom. Reserve Mining Co. v. EPA, 514 F.2d 492, 5 ELR 20596 (8th Cir. 1975); United States v. Ira S. Bushey & Sons, Inc., 363 F. Supp. 110, 4 ELR 20071 (D. Vt. 1973), noted in 14 B.C. Ind. & Com. L. Rev. 767 (1973); United States v. Lindsay, 357 F. Supp. 784 (E.D.N.Y. 1973); United States v. United States Steel Corp., 356 F. Supp. 556, 3 ELR 20204 (N.D. Ill. 1973), noted in 15 B.C. Ind. & Com. L. Rev. 795 (1974). See Comment, supra note 1, 2 ELR at 10170.

4. 33 U.S.C. §§ 1251 et seq., ELR 41101-28.

5. United States v. Lindsay, 357 F. Supp. 784 (E.D.N.Y. 1973).

6. United States v. Stoeco Homes, Inc., 359 F. Supp. 672 (D.N.J. 1973); United States v. United States Steel Corp., 356 F. Supp. 556, 3 ELR 20204 (N.D. Ill. 1973); United States v. Ira S. Bushey & Sons, Inc., 346 F. Supp. 145, 2 ELR 20557 (D. Vt. 1972).

7. 517 F.2d 492, 520-22, 5 ELR 20596, 20613 (8th Cir. 1975).

8. 33 U.S.C. §§ 1151 et seq.

9. 33 U.S.C. § 407, ELR 41142.

10. 512 F.2d 1036, 5 ELR 20261 (7th Cir. 1975).

11. United States v. United States Steel Corp., 356 F. Supp. 556, 3 ELR 20204 (N.D. Ill. 1973).

12. United States v. Ira S. Bushey &Sons, Inc., 363 F. Supp. 110, 4 ELR 20071 (D. Vt. 1973).

13. 406 U.S. at 107, 2 ELR at 20205.

14. Illinois v. City of Milwaukee, 366 F. Supp. 298, 4 ELR 20045 (N.D. Ill. 1973).

15. United States v. Ira S. Bushey & Sons, Inc., 363 F. Supp. 110, 4 ELR 20071 (D. Vt. 1973); United States v. United States Steel Corp., 356 F. Supp. 556, 3 ELR 20204 (N.D. Ill. 1973).

16. 406 U.S. at 105 n. 6, 2 ELR at 20204 n. 6.

17. 394 F. Supp. 618, 5 ELR 20440 (S.D.N.Y. 1975).

18. The court also noted without discussion that the river was the principal plaintiff, id., a proposition whose validity is legally tenuous. See Sierra Club v. Morton, 405 U.S. 727, 2 ELR 20192, 20196 (1972) (Douglas, J., dissenting). Cf. Stone, Should Trees Have Standing? Toward Legal Rights for Natural Objects, 45 S. Cal. L. Rev. 450 (1972).

19. __ F.2d __, 6 ELR 20703 (4th Cir. July 16, 1976), aff'g 375 F. Supp. 1148 (D. Md. 1974).

20. 33 U.S.C. § 1342(k).

21. 6 ELR at 20705.

22. Section 505(e) of the FWPCA states:

Nothing in this section shall restrict any right which any person (or class of persons) may have under any statute or common law to seek enforcement of any effluent standard or limitation or to seek any other relief (including relief against the Administrator or a State agency).

33 U.S.C. § 1365(e).

23. 405 U.S. 727, 2 ELR 20192 (1972).

24. __ F.2d __, 6 ELR 20666 (1st Cir. Aug. 26, 1976).

25. 33 U.S.C. § 1365(h).

26. 406 U.S. at 103, 2 ELR at 20204.

27. See Donley & Hall, Section 208 and Section 303 Water Quality Planning and Management: Where is it Now?, 6 ELR 50115 (Oct. 1976).

28. See text at notes 11-12 supra.

29. See text at note 17 supra.

30. 33 U.S.C. § 1251(a).

31. See text at notes 14-15 supra.

32. Congressional Research Service, Environmental Policy Division, A Legislative History of the Water Pollution Control Act Amendments of 1972, 819-21, 1499 (1973).

33. Conservation Soc'y of Southern Vermont v. Secretary of Transportation, 508 F.2d 927, 5 ELR 20068 (2d Cir. 1974); Natural Resources Defense Council v. Callaway, 524 F.2d 79, 5 ELR 20640 (2d Cir. 1975).

34. Natural Resources Defense Council v. Train, 510 F.2d 692, 5 ELR 20046 (D.C. Cir. 1975). Accord, Minnesota v. Callaway, 401 F. Supp. 524, 5 ELR 20703 (D. Minn. 1975).

35. See generally, Comment, Fallout from the California Nuclear Initiative, 6 ELR 10174 (Aug. 1976).

36. Free v. Bland, 369 U.S. 663 (1962). See generally Comment, The State Courts and the Federal Common Law. 27 Albany L. Rev. 73 (1963).

37. Edelman v. Jordan, 415 U.S. 651 (1974).

38. Fitzpatrick v. Bitzer, __ U.S. __, 44 U.S.L.W. 5120, 5124 (June 28, 1976) (Stevens, J., concurring).

39. See Minnesota v. Callaway, 401 F. Supp. 524, 5 ELR 20703 (D. Minn. 1975).

40. Illinois v. City of Milwaukee, 406 U.S. at 98, 2 ELR at 20203.

41. 405 U.S. 727, 2 ELR 20192 (1972).