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Sierra Club, Lone Star Chapter v. Cedar Point Oil Co. Inc.

Court of Appeals for the Fifth Circuit
73 F.3d 546 (1996)
ELI5:

Rule of Law:

The Clean Water Act (CWA) makes it unlawful to discharge any pollutant without a National Pollutant Discharge Elimination System (NPDES) permit, and a citizen may bring an enforcement action for such unpermitted discharges even if the EPA's failure to issue an applicable permit is the reason for the violation. Courts have the authority to determine if a substance, such as oil and gas 'produced water,' qualifies as a 'pollutant' under the CWA's broad definitional categories, like 'industrial waste,' even without a specific EPA regulation designating it as such.


Facts:

  • Cedar Point Oil Company ('Cedar Point') owns and operates an oil and gas well in Galveston Bay, Texas.
  • The extraction process generates a byproduct called 'produced water,' which contains various substances including barium, benzene, zinc, oil, and grease.
  • Beginning on September 10, 1991, Cedar Point began discharging between 500 and 1,200 barrels of produced water per day directly into Galveston Bay.
  • Throughout this period, Cedar Point did not have a National Pollutant Discharge Elimination System (NPDES) permit from the Environmental Protection Agency (EPA) authorizing this discharge.
  • Cedar Point held a permit from the Texas Railroad Commission, but this permit only set limits on oil and grease content and noted that a separate EPA permit might be required.
  • The EPA had not yet promulgated a general or individual NPDES permit program for oil and gas operators in the 'Coastal Subcategory,' to which Cedar Point belonged.
  • On October 15, 1992, after learning other operators were being sued, Cedar Point applied to the EPA for an NPDES permit, but the EPA failed to act on the application.

Procedural Posture:

  • On December 16, 1992, Sierra Club sent Cedar Point a notice of intent to sue under the Clean Water Act.
  • Cedar Point preemptively sued Sierra Club and the EPA in the U.S. District Court for the Southern District of Mississippi, seeking to enjoin the threatened citizen suit; the court dismissed Cedar Point's claims against Sierra Club.
  • On April 20, 1993, Sierra Club sued Cedar Point in the U.S. District Court for the Southern District of Texas, alleging CWA violations and seeking an injunction and civil penalties.
  • Cedar Point filed a counterclaim for abuse of process, which the district court dismissed for failure to state a claim.
  • The district court granted Sierra Club's motion for partial summary judgment, finding Cedar Point liable under the CWA as a matter of law.
  • After a bench trial on penalties, the district court assessed a civil penalty of $186,070, enjoined further discharges, and awarded attorneys' fees to Sierra Club.
  • Cedar Point appealed the final judgment and various pre-trial rulings to the U.S. Court of Appeals for the Fifth Circuit.
  • The district court later modified the injunction after the EPA issued a new general permit, and Sierra Club separately appealed that modification; the Fifth Circuit consolidated the appeals.

Locked

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Issue:

Does the discharge of 'produced water' into navigable waters without a National Pollutant Discharge Elimination System (NPDES) permit violate the Clean Water Act, even when the Environmental Protection Agency has not issued an applicable permit or effluent limitation for that specific type of discharge?


Opinions:

Majority - Judge King

Yes, the discharge of 'produced water' without an NPDES permit violates the Clean Water Act. The CWA plainly makes the discharge of any pollutant unlawful unless it is done in compliance with a permit. A discharger cannot use the EPA's administrative delay or failure to issue a permit as a defense against liability for an unpermitted discharge. The court reasoned that the CWA's citizen suit provision allows actions against any person committing an unlawful act under § 1311(a), which includes any discharge of a pollutant without a permit. While Congress initially created temporary 'liability shields' to protect dischargers from suit during the CWA's implementation phase, those protections expired in the 1970s, and Congress's failure to extend them indicates an intent to hold dischargers strictly liable. The court further held that 'produced water' is a 'pollutant' under the CWA because it falls within the broad statutory categories of 'industrial waste' and 'chemical wastes.' The statutory definition of pollutant, which specifically excludes produced water only when it is disposed of in a state-approved well, strongly implies that produced water discharged into surface waters is a pollutant. Therefore, Cedar Point's unpermitted discharge was a clear violation of the Act.



Analysis:

This decision solidifies the principle of strict liability under the Clean Water Act for discharging pollutants without a permit, clarifying that a discharger cannot use the EPA's administrative delay as a defense. It places the burden squarely on the discharger to cease operations or find a compliant disposal method if a permit is unavailable, reinforcing the CWA's goal of eliminating pollutant discharges. This precedent strengthens the power of citizen-plaintiffs by allowing them to enforce the CWA's core prohibition even in regulatory vacuums. The ruling also affirms that courts can interpret the broad statutory definition of 'pollutant' without waiting for specific EPA action, ensuring that enforcement is not paralyzed by agency inaction.

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