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Supreme Court Ruling Spurs Deal in Cape Cod Pollution Case (2)

May 27, 2020, 2:29 PMUpdated: May 29, 2020, 3:23 PM

Environmentalists and a Cape Cod beach club have agreed to settle a water pollution dispute in light of a major Supreme Court ruling on the scope of the Clean Water Act.

The Conservation Law Foundation and the Wychmere Beach Club on Tuesday notified the U.S. Court of Appeals for the First Circuit that they had resolved their legal fight over the venue’s wastewater management system.

The deal is the first major settlement to follow the Supreme Court’s April decision in County of Maui v. Hawai’i Wildlife Fund. The justices ruled that indirect water pollution triggers federal permitting requirements when it’s the “functional equivalent” of direct pollution.

The Supreme Court’s ruling rejected a 2019 Trump administration policy that said pollution that flows through groundwater is beyond the scope of the Clean Water Act.

A federal district court deferred to the Trump administration’s interpretation in November when it tossed the Conservation Law Foundation’s claims that the Wychmere Beach Club violated federal law by allowing treated wastewater to seep through groundwater into Wychmere Harbor.

“The Parties agree that, in light of the Maui decision, vacatur of the Judgment and the portion of the District Court’s Summary Judgment Order affording Chevron deference to the EPA Interpretive Statement is appropriate,” the litigants told the First Circuit, referring to the legal doctrine in which courts often accept agency interpretations of ambiguous laws.

Settlement Terms

The environmental organization and a set of Wychmere-related companies attached a proposed consent decree that requires the venue to install a filtration system and dispose of waste offsite in the meantime.

Under the agreement, which is subject to district court approval, Wychmere Harbor Real Estate LLC and Wychmere Shores Condominium Trust don’t admit any liability but agree to pay the Conservation Law Foundation $135,000 in attorneys’ fees and costs.

They also agree to conduct a supplemental environmental project: funding nitrogen reduction programs for Wychmere Harbor.

The Justice Department recently barred the use of supplemental environmental projects in settlements involving the federal government.

“Yesterday’s filing brings us one step closer to a cleaner Wychmere Harbor and we’re happy to be working together with the resort to reach that goal,” Christopher Kilian, vice president of strategic litigation for the Conservation Law Foundation, said in a statement.

Lawyers for Wychmere didn’t immediately respond to requests for comment on the agreement.

Longwood Venues & Destinations, listed as a defendant in the case name, is no longer affiliated with Wychmere Beach Club, and is not part of the case.

The case is Conservation Law Found. v. Longwood Venues & Destinations, 1st Cir., No. 20-01024, 5/26/20.

(Updates May 27 story to add detail about case parties in final paragraph.)

To contact the reporter on this story: Ellen M. Gilmer in Washington at egilmer@bloombergindustry.com

To contact the editors responsible for this story: Gregory Henderson at ghenderson@bloombergindustry.com; Anna Yukhananov at ayukhananov@bloombergindustry.com