September 18, 2013
“We bought this property years ago on which to build our retirement home. Now EPA says we are guilty of filling wetlands,” reports an older couple. Another person caught up in a wetland enforcement action claims, “I haven’t done anything wrong. I got my state approval! Why is EPA harassing me and not going after real polluters?” Or in another case, the landowner asserts, “This area isn’t even a ‘wetland.’ Give me a break – I can walk on it just fine over half the year. The government is out of control.” Vignettes such as these, where citizens feel their own government has unfairly and irrationally targeted them, have played out across the country and frequently attract the attention of elected representatives and the press.
Meanwhile, the Environmental Protection Agency (EPA) views cases like these from a different perspective. For instance, EPA may have been monitoring the deleterious effects stemming from numerous losses of wetlands and other aquatic habitats in watersheds where unauthorized activities are occurring. Each individual case may not be particularly significant but EPA believes that, if left unregulated, the cumulative effect of these and other actions will result in lasting damage to water quality, wildlife habitat, and other environmental values. As any dieter knows, it’s the number of bites rather than the size of the bites that matters. Moreover, the law is clear: the Clean Water Act is a strict liability statute that has been in place for over 40 years and requires authorization for most wetland filling. The integrity of the regulatory program, in EPA’s view, depends in part on operating a credible enforcement program against those who do not play by the rules.
These distinctly different views between the regulator and the regulated illustrate a conundrum emblematic of environmental protection generally and that is particularly conspicuous in the context of wetland enforcement: each incremental activity might be reasonable in its own context but may constitute an insidious problem in aggregate. CBI recently assisted the parties in one such wetland case to reach an agreement and it underscored why these matters are frequently good candidates for mediation.
By far, most Clean Water Act enforcement actions involve municipalities or privately owned facilities of some kind and occur pursuant to the Section 402 (NPDES) program. These violations can often be resolved in a straightforward manner; counsel ably represents respondents and the parties reach settlement after a period of negotiation that may or may not be contentious. Mediation can certainly be useful in these cases although parties often resolve matters with unassisted negotiation.
In contrast, the small subset of Clean Water Act enforcement actions involving Section 404 (which includes wetland filling) frequently favor the use of a third party neutral. They often include factors that can complicate settlement prospects, such as:
Parties are operating on different scales. As noted above, respondents in wetland enforcement cases see their actions in a local context (“filling an acre of swamp is bad for the environment…are you kidding me?”) whereas federal regulators may be looking at matters in a larger ecosystem standpoint. EPA staff may understandably be concerned about the credibility of the regulatory program, something, also understandably, not high on a respondent’s list of interests.
The nature of wetlands themselves. The dual nature of wetlands—neither entirely land nor entirely water—make them uncertain ground when it comes to regulation and enforcement. The same area may be an important hydrological and biological component of a watershed and yet be zoned and taxed as residential or commercial property. There also remains complexity and confusion about wetland delineation; while defining the exact point at which a wetland ends and upland begins has little ecological meaning, it is essential from a regulatory standpoint and for property owners remaining on the right side of the law. Courts are not always well equipped to address complicated scientific questions and yet they do not necessarily have to be agreed upon in the context of case settlement.
Potential for high emotion. Wetland cases frequently evidence strong emotions. While having to deal with legal issues is a staple of life for corporations and municipalities, many (not all) respondents in a wetland enforcement case are individuals who have never been in trouble with the federal government before. They often experience a tangled mix of emotions involving incredulity, apprehension, and indignation. Those on the receiving end of an enforcement action will sometimes report feeling as if they are being “treated like a criminal” even though the enforcement actions are almost always either administrative or civil judicial. Respondents frequently grapple with conflicting feelings, in part wanting to fight what seems an injustice and in part wishing to settle the matter and put it behind them. A party in this situation will often benefit from retaining counsel although it is not unusual for them to be pro se.
Litigation costs and risks. With several aspects of the jurisprudence in the wetland program area remaining unsettled and enforcement cases often presenting difficult factual questions (e.g., determining pre-fill wetland boundaries), the option of litigation may be problematic for both parties. While a would-be defendant has every right to make the government prove its case in court, the emotional and financial costs may be exorbitant. In addition, settlement terms are generally well shy of the total exposure faced should the matter go to court. From the government’s perspective, wetland cases can be laborious to assemble for litigation and involve situations where the equities run in part to the defendant (e.g., a defendant may have dutifully obtained state authorization). Defendants in wetland cases sometimes have “jury appeal” as well or lead to negative publicity for EPA if the story is portrayed as the heavy hand of government upon an outgunned citizen.
Cases like these—where parties approach an issue from markedly different contexts, face complicated facts and strong emotions, and consider what may be substantial risks to not settling—are often good candidates for mediation. The mediator can help parties understand (not necessarily agree with) each other’s interests and, where possible, set aside legal and factual issues that need not be resolved in order find the ingredients for settlement. The mediator can assist with sizing up the potential risks and benefits of various options, including that of not reaching an agreement. In some cases, the mediator may help parties communicate more effectively. For example, with assistance, the government may be able to find ways to express empathy without being prejudicial to its own case. The respondent may be able to use the mediator to understand better where the government believes itself to have greater or lesser flexibility, as well as where trade-offs might be possible.
The case that CBI recently mediated included many of the challenges described above. The case was at an impasse for some time but moved forward when the respondent, with encouragement from the mediator, retained counsel to represent his interests (a step also welcomed by EPA). Finally, the proposed consent agreement and final order contains a creative provision that illustrates the flexibility of mediation. As is typical, EPA underwrote the cost of mediation services using its existing contractual mechanisms. To reach settlement in this case the parties needed to agree on a penalty figure, something that proved elusive. In the end, the respondent agreed to pay for a portion of the mediation cost, an idea that was more palatable to him than paying a higher penalty figure to the government. The respondent viewed this solution as payment for a helpful service and EPA viewed it as a form of cost-recovery.