By Joel Beauvais

Can a discharge “through” groundwater violate the Clean Water Act?

If a pipeline spills fuel that travels through groundwater into a stream, is it a discharge in violation of the Clean Water Act (CWA)? What if pollutants leach out of a coal ash impoundment into groundwater and later end up in a nearby river? What if a sewage utility injects treated wastewater into the ground and it travels through groundwater to the ocean? These are the kinds of questions raised by a rapidly expanding set of CWA citizen suits based on the so-called “groundwater conduit” theory. The theory holds that an unpermitted discharge of a pollutant into groundwater can violate the CWA if the pollutant is conducted through groundwater to a “water of the United States.” More than half a dozen district court decisions addressing this issue have been handed down in the last few years, and at present five appeals are pending in three different U.S. Courts of Appeals. The sheer volume of litigation, together with the serious implications of the theory for a host of major industries, make this one of the hottest issues in environmental law today and a likely candidate for Supreme Court review.

The CWA prohibits the “discharge of any pollutant” to waters of the United States unless authorized by a permit. Discharge of a pollutant is defined as “any addition of any pollutant to [waters of the United States] from any point source.” “Point source” means “any discernible, confined and discrete conveyance,” including any pipe, ditch, discrete fissure, or container. The scope of waters of the United States is a notoriously complex and controversial issue, but the exclusion of groundwater is well established. The issue, then, is whether the unpermitted discharge of a pollutant from a point source to groundwater — where the pollutant is then conducted through groundwater to a qualifying surface water — violates the CWA.

Recent case law has muddied the water

Although the groundwater conduit theory is not new, the number of citizen suits based on it have increased dramatically in the last few years. Most of the recent cases on this issue involve coal ash impoundments, and the decisions are split. In Cape Fear River Watch v. Duke Energy Progress, Inc., 25 F. Supp. 3d 798 (E.D.N.C. 2014), the court held that the CWA does not cover discharges to groundwater, regardless of whether the groundwater is “hydrologically connected” to surface waters. But in Yadkin Riverkeeper Inc. v. Duke Energy Carolinas, 141 F. Supp. 3d 428 (M.D.N.C. 2015), Sierra Club v. Virginia Electric Power Co., 247 F.Supp.3d 753 (E.D.Va. 2017) (VEPCO), and Tennessee Clean Water Network v. Tennessee Valley Authority, No. 3:15-cv-00424 (M.D. Tenn. Aug. 4, 2017) (TVA), the district courts held that ash impoundments were point sources and that the unpermitted discharge of pollutants from such impoundments into groundwater, followed by migration to surface waters, violated the CWA.

But the implications of the groundwater conduit theory are much broader than ash impoundments, as other recent cases make clear. In Upstate Forever v. Kinder Morgan Energy Partners, 252 F. Supp. 3d 488 (D.S.C. 2017), the district court rejected the theory in a case involving the discharge of more than 300,000 gallons of petroleum products as a result of a pipeline rupture. On the other hand, in Hawaii Wildlife Fund v. County of Maui, 24 F. Supp. 3d. 980 (D. Haw. 2014), the court relied on the theory to hold a utility liable in connection with underground injection of treated wastewater. Although that injection was permitted under the Safe Drinking Water Act, the utility did not have a CWA permit and a study later determined that the wastewater was traveling a half mile through groundwater to the Pacific Ocean.

Parties on both sides of these cases have marshalled arguments based on 1) the CWA’s text and legislative history, 2) EPA’s (seemingly contradictory) past statements on the issue, 3) the practical implications of the theory for a host of economic activities, and 4) impacts on the interaction of the CWA with other legal regimes, including state and local regulation of groundwater and federal regulation of coal ash disposal and underground waste injection. Environmental groups and trade associations representing a diverse group of industries have weighed in with amicus briefs, underscoring the broad salience of the issue.

Several of these decisions are now on appeal. The Ninth Circuit has heard argument in the Maui case, and the U.S. Environmental Protection Agency weighed in with an amicus brief, arguing that discharge of pollutants through groundwater can violate the CWA if there is a “direct hydrologic connection” to a water of the United States. In addition, appeals of both the VEPCO and Upstate Forever cases are pending before the Fourth Circuit, and the TVA decision has been appealed to the Sixth Circuit. The outcomes in these cases will be consequential in their own right and may well tee the issue up for Supreme Court review, particularly if the Circuits split.

The course ahead

Although the groundwater conduit theory is not new, the number of citizen suits based on it have increased dramatically in the last few years.  While there are differences between the facts in these cases, the divergent outcomes underscore the continuing uncertainty in the law. Pending Court of Appeals decisions — and possible litigation in the Supreme Court — may help to clarify the scope of the CWA.  Depending in part on the outcome of those cases, key industries such as electric and water utilities and oil and gas, mining and manufacturing companies should consider calling on EPA to provide further clarity through rulemaking or guidance. Whatever the path, resolution of these issues is critically important for companies seeking regulatory certainty — particularly given the breadth of activities and the scale of potential liability, which has ranged from tens of millions to billions of dollars in several of the recent cases.