The United States Court of Appeals for the Seventh Circuit will soon have the opportunity to apply the U.S. Supreme Court’s recent County of Maui v. Hawaii Wildlife Fund ruling to a long-running dispute between an environmental group and the owner of a coal-fired power plant. 140 S.Ct. 1462 (2020).  The case is Prairie Rivers Network v. Dynegy Midwest Generation, LLC, No. 18-3622 (7th Cir.), and at issue is whether Dynegy is liable under the Clean Water Act (CWA) for alleged discharges from coal ash ponds through groundwater into a local river.

The U.S. District Court for the Central District of Illinois dismissed the complaint, reasoning that the coal ask in question is regulated under the Resource Conservation and Recovery Act, not the CWA.  Prairie Rivers Network appealed to the Seventh Circuit, focusing its arguments largely on whether and how the Act applies to the alleged groundwater contamination after the Supreme Court’s 2020 County of Maui decision.

In County of Maui, the Supreme Court held that the CWA require[s] a permit if the addition of the pollutants through groundwater is the functional equivalent of a direct discharge from the point source into navigable waters.  In other words, the CWA prohibits unpermitted discharge of pollution into navigable waters or when the discharge reaches the same result through roughly similar means.

The Seventh Circuit recently heard oral arguments in Prairie Rivers.  Since the case was decided on a motion to dismiss, the Court will have to determine whether the case warrants remand to the district court.  If remanded, the lower court must then decide whether, under the new test established by the Supreme Court, the leakage from coal ash ponds into groundwater, which allegedly migrates to the river, is the functional equivalent of direct discharges to the river.  If it is, the owner of the coal ash ponds will need to obtain a CWA permit.

This is but one case in a slew of many where the lower courts will have to apply the Maui decision’s “functional equivalent” test.  Regulated industries and trade associations should monitor these cases and decisions to have an understanding as to how the “functional equivalent” test is being applied.