LINCOLN, Neb. (DTN) -- A cottage industry run by nongovernmental organizations to sue federal agencies, including the U.S. Environmental Protection Agency, may be getting much larger after the Supreme Court on Monday issued a ruling in what seemed to be an otherwise obscure case.
The court reversed a previously well-settled precedent that the six-year statute of limitations starts to run from the date federal regulations became effective.
The Supreme Court's decision in Corner Post Inc. v. Federal Reserve now interprets the six-year statute of limitations as beginning to run when a named plaintiff suffers the harm alleged in a lawsuit, even decades after federal regulations are finalized.
Brook Duer, staff attorney in the Center for Agricultural and Shale Law at Penn State University, told DTN the ruling opens the door even wider for environmental groups and others to continue suing the EPA and other agencies by continuing to find new plaintiffs.
As an example, Duer said the court's ruling could affect federal permits for concentrated animal feeding operations.
The distinction made in EPA regulations not to require National Pollution Discharge Elimination System permits for so-called small CAFOs, was made far more than six years ago.
Since the Corner Post decision, for example, he said NGOs wishing to impose a rule that all animal production facilities that do not produce their own feed must obtain an NPDES permit no matter how small, "simply need to arrange for a 'new' plaintiff."
For example, a new plaintiff could be someone who moved into the watershed of an NPDES-exempt farm in the past six years, Duer said, who would be alleged to have suffered harm from such an exemption.
"With regard to EPA actions, filling the federal courts with such litigation is a veritable cottage industry with multiple NGOs devoted to little else," Duer told DTN.
"Common legal grounds alleged are that the regulation violates provisions of the Administrative Procedures Act, articulating the process and parameters for legally promulgating regulations or that the regulation goes beyond the legal scope of the law authorizing their issuance."
Corner Post Inc. operates a truck stop and convenience store in North Dakota.
The company joined a lawsuit filed under the Administrative Procedure Act in 2021, against the board of governors of the Federal Reserve System.
The lawsuit challenged a 2011 regulation that called for higher interchange fees for accepting debit cards for purchases. A district court dismissed the lawsuit as time-barred by the six-year statute of limitations, as Corner Post didn't launch its business until 2018.
Duer said the Corner Post decision creates a system "whereby there is no longer any finality to how a law is implemented."
Any portion of a federal regulation can be legally challenged at any time, he said, simply by arranging for a newly named plaintiff.
"This means provisions of regulations can be challenged decades after they have been promulgated and after years of reliance by the regulated industry on the predictability and precedent set by regulations that have been on the books for years," Duer said.
"The methods and structures for achieving regulatory compliance, sometimes decades in the making, can be upset at any time."
To use an analogy, Duer said regulations are the "building blocks" used by a federal agency to implement laws enacted by Congress.
"If the law is the design blueprint of a building, the implementing regulations promulgated and followed in the day-to-day implementation of the law are the actual specifications for construction," Duer said.
"Like the game 'Jenga,' removing a component of a regulation years after its placement can cause the entire structure to distort or fail. Such is the case with regulations."
Todd Neeley can be reached at todd.neeley@dtn.com
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