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Successful Appeal Reinforcing Michigan’s Assumed Authority Over Wetland Program Under Section 404(g) of the Clean Water Act

Warner successfully represented its client, Aquila Resources Inc., in an appeal challenging Michigan’s jurisdiction over Aquila’s wetland permit application. Aquila Resources Inc. needed a wetland permit to construct and operate an open-pit zinc and gold mine in the Upper Peninsula of Michigan near the Menominee River. Typically, an applicant would need to seek a wetland permit from the Army Corps of Engineers under Section 404 of the Clean Water Act. But Michigan is one of two states that has assumed authority over the wetland program under Section 404(g). However, under Section 404(g), the federal government cannot divest itself of jurisdiction for certain navigable waters. As part of the assumption, in 1984, the Army Corps determined that most of the Menominee River, including the section near the proposed mine, was not navigable under Section 404(g). Approximately two years into Aquila’s state wetland permitting process, the Menominee Indian Tribe of Wisconsin wrote letters to both the Army Corps and the EPA claiming that the relevant section of the river was navigable, and asking them to exercise jurisdiction over the wetland permitting process. Both agencies sent letters to the Tribe declining to exercise jurisdiction.  The Tribe subsequently filed suit, claiming that the agencies violated the Administrative Procedures Act by deciding not to exercise permitting authority. The district court dismissed the lawsuit, holding that the EPA and Army Corps’ letters did not constitute final agency action under the Administrative Procedures Act.  In a unanimous, published opinion, the U.S. Court of Appeals for the Seventh Circuit affirmed the district court’s decision. The court of appeals agreed with Warner’s argument that, because the Army Corps and EPA letters only reiterated the status quo by simply restating that Michigan had assumed permitting authority over the relevant section of the Menominee River in 1984, there was no final agency action for the court to review.