Under the Administrative Procedure Act (APA) (5 U.S.C. § 500 et seq.), final agency actions are subject to judicial review when there is no other adequate remedy in court. So, to challenge an agency action under the APA, a plaintiff must show that the agency’s action is final and there is no other adequate option to challenge the action in court. Yesterday, on May 31, 2016, the United States Supreme Court clarified these standards in United States Army Corps of Engineers v. Hawkes Co., Inc. (Hawkes), 578 U.S. ___ (2016).

In Hawkes, landowners challenged a jurisdictional determination issued and revised by the U.S. Army Corps of Engineers (Army Corps). The district court dismissed the challenge based on its finding that the revised jurisdictional determination was not a final agency action for which there was no other adequate remedy in court. The Eighth Circuit reversed. The Supreme Court agreed with the Eighth Circuit, holding that the revised jurisdictional determination was a final agency action, and there were no adequate alternative remedies in court.

The Supreme Court first addressed the definition of a final agency action, and identified two requisite conditions. First, the action must indicate the completion of the agency’s decision-making process. In Hawkes, the Army Corps issued the revised jurisdictional determination after extensive fact-finding, and the type of jurisdictional determinations at issue are typically not revisited if the permitting process proceeds. The Court stated that the Army Corps’ ability to revise the jurisdictional determination does not render a decision non-final. The Court found that, for all practical purposes, the Army Corps ruled definitively on the status of the landowners’ property and, thus, satisfied the first condition.

The second condition for a final agency action requires that rights or obligations must have been determined pursuant to the action or that legal consequences will flow from the action. In other words, the action must give rise to direct and appreciable legal consequences. The Supreme Court found that legal consequences flowed from the Army Corps’ decision because it eliminated a legal safe harbor that would have been available under the opposite decision. Additionally, the landowners risked significant civil and criminal penalties if they discharged pollutants onto their property without a permit. Thus, the Court found that the Army Corps’ revised jurisdictional determination was a final agency action.

The Supreme Court then turned to whether the landowners had adequate alternative remedies in court. The Army Corps’ suggested alternatives were to discharge material without a permit and await enforcement action or apply for a permit and seek judicial review if dissatisfied with the decision. The Supreme Court found neither alternative was adequate. Significantly, the Supreme Court unequivocally stated “parties need not await enforcement proceedings before challenging final agency action where such proceedings carry the risk of ‘serious criminal and civil penalties.’ ” (Slip Op. at 8.) The Court found that waiting for agency enforcement while risking civil penalties and criminal liability in order to have access to judicial review is an unacceptable alternative. The Court also found that applying for and litigating a permit was an unacceptable alternative because the permitting process is long and expensive, and ultimately would not alter the jurisdictional determination’s finality or reviewability. Thus, the Court found that the landowners had no adequate alternative remedy.

In sum, the Supreme Court affirmed the Eighth Circuit’s judgment that the Army Corps’ action was final and judicially reviewable under the APA.

The full Supreme Court opinion can be found here. For more information on the Court’s opinion, please contact Lauren Bernadett at lbernadett@somachlaw.com.

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