June 22, 2009

Supreme Court Decides Coeur Alaska, Inc. v. Southeast Alaska Conservation Council

On June 22, the Supreme Court decided Coeur Alaska, Inc. v. Southeast Alaska Conservation Council, Nos. 07-984 & 07-990.

Coeur Alaska plans to reopen the Kensington Gold Mine in Alaska, and to make it profitable by using a technique known as "froth flotation." A byproduct of froth flotation is slurry, a mixture of approximately 30 percent crushed rock, resembling wet sand and water. Coeur Alaska plans to pump the slurry into Lower Slate Lake, which is navigable water subject to the Clean Water Act (CWA). The solid tailings from the slurry will sink to the bottom of the lake. Over the life of the mine, Coeur Alaska would pump 4.5 million tons of tailings into the lake, raising the lakebed 50 feet, to its current surface level, and increasing the lake's area from 23 to 60 acres. To contain the larger lake, Coeur Alaska would dam the lake's downstream shore. The lake water would be cleaned by purification systems and then flow from the lake to a stream and onward.

Coeur Alaska's plans were reviewed and approved by several state and federal agencies. The U.S. Army Corps of Engineers issued a permit to Coeur Alaska, allowing it to proceed with its plans to pump slurry into Lower Slate Lake. The Environmental Protection Agency (EPA) issued its own permit, allowing Coeur Alaska to discharge water from the lake into the downstream creek. The EPA permit imposes strict limits on the amount of pollutants the discharged water may contain under its "new source performance standards."

Three environmental groups, including the Southeast Alaska Conservation Council (SEACC), filed suit against the corps, challenging its permit. Coeur Alaska and the State of Alaska intervened as defendants, and the district court ultimately entered summary judgment in favor of the defendants. The U.S. Court of Appeals for the Ninth Circuit reversed, holding that the new source performance standard of the CWA applied not only to discharges from the lake to the downstream creek, but also to discharges from the mine into the lake and that the corps lacked authority to issue a permit under that standard.

The Court reversed. Section 402 of the CWA authorizes the EPA to issue a permit for the discharge of "any pollutant," with one exception. The EPA may not issue permits for the discharge of fill material that falls within the corps' permitting authority under § 404(a) of the CWA. SEACC argued that § 404 contains an implicit exception, so that the corps may not permit a discharge of fill material that is also subject to an EPA new source performance standard. The Court relied on the plain language of the CWA, and also weighed practical considerations for the industry, in concluding that there is no such exception. Because the slurry that Coeur Alaska seeks to discharge into the lake is defined by regulation as "fill material," the corps has authority to issue the permit.

SEACC also argued that the corps' permit is unlawful because it violates the EPA's new source performance standard. After considering the language of the CWA, the agencies' regulations interpreting the statute and the EPA's subsequent interpretation of those regulations, the Court held that it would defer to the EPA's conclusion that its performance standard does not apply to the initial discharge of slurry into the lake, but applies only to the later discharge of water from the lake into the downstream creek.

Justice Kennedy delivered the opinion of the Court, in which Chief Justice Roberts and Justices Thomas, Breyer and Alito joined, and in which Justice Scalia joined in part. Justice Breyer filed a concurring opinion. Justice Scalia filed an opinion concurring in part and concurring in the judgment. Justice Ginsburg filed a dissenting opinion, in which Justices Stevens and Souter joined.

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