Precon Development Corp. v. United States Army Corps of Engineers

UNPUBLISHED

UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT

No. 13-2499

PRECON DEVELOPMENT CORPORATION, INCORPORATED,

Plaintiff − Appellant,

UNITED STATES ARMY CORPS OF ENGINEERS,

Defendant − Appellee.

−−−−−−−−−−−−−−−−−−−−−−−−

ROBERT B. ATKINSON; KIRK J. HAVENS; CARLTON H. HERSHNER,
JR.; JAMES PERRY; DANIEL L. TUFFORD; JOY B. ZEDLER,

Amici Supporting Appellee.

Appeal from the United States District Court for the Eastern
District of Virginia, at Norfolk. Rebecca Beach Smith, Chief
District Judge. (2:08-cv-00447-RBS-TEM)

Argued: December 10, 2014 Decided: March 10, 2015

Before SHEDD, DIAZ, and FLOYD, Circuit Judges.

Affirmed by unpublished opinion. Judge Diaz wrote the opinion,
in which Judge Shedd and Judge Floyd joined.

ARGUED: Douglas E. Kahle, WOLCOTT RIVERS GATES, Virginia Beach,
Virginia, for Appellant. Mary Gabrielle Sprague, UNITED STATES
DEPARTMENT OF JUSTICE, Washington, D.C., for Appellee. ON
BRIEF: Glen M. Robertson, WOLCOTT RIVERS GATES, Virginia Beach,
Virginia, for Appellant. Sam Hirsch, Acting Assistant Attorney
General, Katherine W. Hazard, Environment & Natural Resources
Div., Appellate Section, UNITED STATES DEPARTMENT OF JUSTICE,
Washington, D.C., for Appellee. Deborah M. Murray, SOUTHERN
ENVIRONMENTAL LAW CENTER, Charlottesville, Virginia; Jan Goldman
Carter, NATIONAL WILDLIFE FEDERATION, Washington, D.C., for
Amici Curiae.

Unpublished opinions are not binding precedent in this circuit.

2
DIAZ, Circuit Judge:

This appeal is the latest installment in a thirteen-year

battle between Precon Development Corporation and the U.S. Army

Corps of Engineers about whether the Corps has jurisdiction

under the Clean Water Act over Precon’s Edinburgh development 1 in

Chesapeake, Virginia. This episode involves 4.8 acres of

wetlands that Precon wants to fill to build ten homes. The

Corps asserted jurisdiction over these wetlands and denied

Precon’s permit application. 2 We previously remanded this case

after concluding that the Corps had not provided sufficient

evidence to support its jurisdiction. Finding that the Corps

has now amassed adequate evidence, we affirm.

Our opinion in Precon Development Corp. v. U.S. Army Corps

of Engineers (Precon I), 633 F.3d 278 (4th Cir. 2011), provides

a detailed account of the law and facts of this case. We

briefly recap here only what is necessary to resolve the current

appeal.

1
Edinburgh is a “planned unit development” that “contains
shopping centers, a light industrial complex, and residential
homes in several neighborhoods.” Appellant’s Br. at 3.
2
Precon has not challenged the denial of its permit
application in its appeals to this court.

3
In Precon I, we found that the applicable law for

evaluating the Corps’ assertion of jurisdiction over Precon’s

wetlands was the significant nexus test from Justice Kennedy’s

opinion concurring in the judgment in Rapanos v. United States,

547 U.S. 715 (2006). 3 When wetlands, such as Precon’s, are

adjacent to tributaries of traditional navigable waters, the

Corps must make a case-specific showing that a “‘significant

nexus’ exists ‘between the wetlands in question and navigable

waters in the traditional sense.’” Precon I, 633 F.3d at 288

(quoting Rapanos, 547 U.S. at 779, 782 (Kennedy, J., concurring

in the judgment)). A significant nexus exists when “the

wetlands, either alone or in combination with similarly situated

lands in the region, significantly affect the chemical,

physical, and biological integrity of” traditional navigable

waters. Id. at 289 (quoting Rapanos, 547 U.S. at 780). No

significant nexus exists when the “wetlands’ effects on water

quality [of traditional navigable waters] are speculative or

insubstantial.” Id. (quoting Rapanos, 547 U.S. at 780).

3
We are bound by Precon I’s statement of the applicable law
under the law of the case doctrine. See TFWS, Inc. v. Franchot,
572 F.3d 186, 191 (4th Cir. 2009) (“[O]nce the decision of an
appellate court establishes the law of the case, it ‘must be
followed in all subsequent proceedings in the same case in the
trial court or on a later appeal . . . .’”) (quoting United
States v. Aramony, 166 F.3d 655, 661 (4th Cir. 1999)).

4
Here, the relevant geographic region encompasses 448 acres

of similarly situated wetlands, including Precon’s 4.8 acres.

We previously upheld this aggregation. Id. at 293. The

relevant traditional navigable water is the Northwest River.

The path from the wetlands to the river is as follows: Precon’s

4.8 acres are adjacent to a 2,500-foot long man-made drainage

ditch. The 2,500-foot Ditch connects to the Saint Brides Ditch. 4

About three miles downstream, the Saint Brides Ditch joins

another tributary. Together, these tributaries form a channel

that flows into the Northwest River. The distance from the 4.8

acres to the Northwest River is about seven miles. 5

During our first review of this case, we found that the

Corps adequately established a nexus between the 448-acre

wetlands and the Northwest River. Id. at 295 & n.14. But we

nonetheless remanded because the Corps’ administrative record

lacked evidence of significance. Id. at 295.

We identified two deficiencies in the administrative

record. First, while the record contained evidence of water

storage capacity and potential flow rates, it lacked any

4
The Corps considered the 2,500-foot Ditch and the Saint
Brides Ditch collectively as the relevant “tributary” to which
the 448 acres of similarly situated wetlands are adjacent. We
approved this appellation in Precon I. 633 F.3d at 292.
5
An aerial map of the region appears in the appendix to
this opinion.

5
information as to actual flow. Id. at 294. Second, we noted

that although the record showed that “the wetlands and their

adjacent tributaries trap sediment and nitrogen and perform

flood control functions,” the record was silent on whether “the

Northwest River suffers from high levels of nitrogen or

sedimentation, or it if is ever prone to flooding.” Id. at 295.

On remand, the Corps expanded its administrative record and

again concluded that it had jurisdiction. Precon appealed this

conclusion administratively and then to the district court. The

district court granted the Corps’ motion for summary judgment,

and Precon appealed.

We review de novo the district court’s grant of summary

judgment. Id. at 289. We also review de novo the Corps’

compliance with the significant nexus test, but apply Skidmore 6

deference to the extent that the Corps’ interpretation of the

test is persuasive. Precon I, 633 F.3d at 289-90, 291, 296. We

defer to the Corps’ factual findings unless they are “arbitrary,

capricious, an abuse of discretion, or otherwise not in

accordance with law.” Id. at 292 (quoting 5 U.S.C.

§ 706(2)(A)).

6
Skidmore v. Swift, 323 U.S. 134 (1944).

6
II.

Precon argues that the Corps’ administrative record still

fails to show a significant nexus between the wetlands in

question and the Northwest River. We disagree.

Before evaluating the new evidence of significance, we

begin with some general observations that inform our approach to

this case. First, the significant nexus test is a “flexible

ecological inquiry.” Id. at 294 (citing Rapanos, 457 U.S. at

799-80). Quantitative or qualitative evidence may support the

Corps’ jurisdiction. Id. at 294. Thus, we find unpersuasive

Precon’s repeated argument that the Corps cannot meet its burden

because the 448-acre wetlands make up a small percentage of the

Northwest River watershed. As the Corps points out, this would

destroy the Corps’ jurisdiction through “death by a thousand

cuts.” Appellee’s Br. at 54.

Second, Precon relies heavily on the report of one of its

experts, Dr. Lawrence B. Cahoon, in which he opined that none of

the wetlands’ functions has a significant effect on the

Northwest River. However, Dr. Cahoon framed significance as

something approaching statistical significance. This sets the

bar too high, as purely qualitative evidence may satisfy the

significant nexus test.

7
Third, although we evaluate the functions of the wetlands

individually, the ultimate inquiry is whether the collective

effect of these functions is significant. In Precon I, we

approved of the Corps’ holistic approach to its jurisdictional

determinations. 633 F.3d at 283 (describing the Corps’ process

as first “assessing the flow characteristics and functions” of

the tributary and adjacent wetlands and then “evaluat[ing]

whether these factors are likely to have an effect that is more

than speculative or insubstantial on the chemical, physical, and

biological integrity of a traditional navigable water” (internal

quotation marks omitted)).

Lastly, the Clean Water Act’s purpose is “to restore and

maintain the chemical, physical, and biological integrity of the

Nation’s waters.” 33 U.S.C. § 1251(a) (2012) (emphasis added).

As the district court observed, this case falls into the

maintenance category because it is a permitting case, not a

civil enforcement action. That informs the type of evidence a

reviewing court can expect the Corps to submit. In a civil

enforcement action, the damage has been done because the

wetlands have already been filled. In the permitting context,

however, the Corps exercises its jurisdiction to prevent damage

and thus cannot be expected to present evidence of the actual

ecological impact of the wetlands on downstream waters.

8
B.

We first consider the Corps’ new evidence on tributary flow

measurements. The administrative record now contains the City

of Chesapeake’s flow rate calculations and evidence from the

Corps’ April and August 2012 site visits.

No government agency has placed flow gauges in the 2,500-

foot Ditch, the Saint Brides Ditch, or the Northwest River. But

the City of Chesapeake has calculated positive flow rates from

two-year, ten-year, and fifty-year storm events 7 at three

locations: the intersection of the 2,500-foot Ditch and the

Saint Brides Ditch, in the Saint Brides Ditch 2,250 feet

downstream from that intersection, and at the farthest point

downstream where the Saint Brides Ditch and the 448-acre

wetlands are adjacent. 8 The City of Chesapeake relies on these

calculations to manage storm waters.

7
By this hydrologists mean the probability of a certain-
size storm occurring during a given year. Thus, a two-year
storm event has a 1 in 2 (or 50%) chance of occurring in a given
year. A fifty-year storm event has a 1 in 50 (or 2%) chance of
occurring in a given year. See Floods: Recurrence Intervals and
100-year Floods, U.S. Geological Survey,
http://water.usgs.gov/edu/100yearflood.html (last updated Nov.
12, 2014) (saved as ECF opinion attachment).
8
The particulars are as follows: At the intersection of the
2,500-foot Ditch and the Saint Brides Ditch, the flow rate is 24
cubic feet per second (cfs), 58 cfs, and 84 cfs for two-year,
ten-year, and fifty-year storm events, respectively. In the
Saint Brides Ditch 2,250 feet downstream, the respective flow
rates are 28 cfs, 60 cfs, and 89 cfs. At the end point where
(Continued)
9
In addition to flow rate calculations, the record now

contains photographs documenting the Corps’ site visits and

showing flow in the Saint Brides Ditch. In April 2012, Corps

personnel observed flow in the Saint Brides Ditch where it

crosses Saint Brides Road, which is downstream of the

intersection of the 2,500-foot Ditch and the Saint Brides Ditch.

The Corps has explained that this crossing is “the closest

downstream observation point.” J.A. 53.

In August 2012, Corps personnel again visited the area and

observed obvious flow in the Saint Brides Ditch where it crosses

Saint Brides Road. The Corps did not observe flow at the

intersection of the 2,500-foot Ditch and the Saint Brides Ditch,

but explained this as “likely the result of debris forming a

dam” somewhere between the intersection with the 2,500-foot

Ditch and the Saint Brides Road crossing point. Id.

One of Precon’s experts, Chester James Cahoon, III,

observed no measurable flow at the intersection of the 2,500-

foot Ditch and the Saint Brides Ditch during biweekly site

visits from mid-September to mid-December 2011. But the Corps

found the evidence gathered during its own site visits and the

the Saint Brides Ditch is adjacent to the 448-acre wetlands, the
respective flow rates are 93 cfs, 241.4 cfs, and 376 cfs. A
flow of 1 cfs “is about 450 gallons per minute.” Floods:
Recurrence Intervals and 100-year Floods, supra n.7.

10
City of Chesapeake’s flow rate calculations to be more reliable

because the region experienced lower than normal rainfall from

October to December 2011. Mr. Cahoon himself noted the “below

normal” precipitation during this time period. J.A. 460.

Because the Corps’ decision to credit certain evidence in the

record over other conflicting evidence is neither arbitrary nor

capricious, we defer to the Corps’ factual finding on this

point. See 5 U.S.C. § 706(2)(A).

In sum, the Corps has improved on its earlier record, which

was limited to evidence of water storage capacity and potential

flow rates. However, tributary flow alone cannot establish

jurisdiction, so we now consider the Corps’ new evidence on the

significance of the wetlands’ functions.

The wetlands perform three functions that relate to the

condition of the Northwest River: they trap nitrogen, store

water, and slow water flow to the river. We earlier found the

record deficient because it lacked any information about the

river’s condition. Now, the Corps’ administrative record

includes three new reports on this subject. These reports--the

January 2011 “Total Maximum Daily Load Development for the

Northwest River Watershed, A Total Phosphorous TMDL Due to Low

Dissolved Oxygen Impairment”; the March 2010 “City of

Chesapeake: A Plan for the Northwest River Watershed”; and the

11
Virginia Department of Environmental Quality’s “Final 2010

305(b)/303(d) Water Quality Assessment Integrated Report” (the

“Integrated Report”)--conclusively establish that the Northwest

River suffers from low dissolved oxygen. In particular, the

Integrated Report shows that the river suffers from this

impairment at the point where it connects to the Saint Brides

Ditch.

According to these reports, dissolved oxygen is one of the

most important measures of water quality for aquatic life, and

one characteristic of nutrient-rich streams is low dissolved

oxygen. The two most important nutrients in Virginia’s rivers

are nitrogen and phosphorous. Recent testing on the Northwest

River showed elevated phosphorous levels, and state

environmental agencies have adopted a plan to reduce phosphorous

in the river.

Precon contends that the wetlands’ nutrient-trapping

function is irrelevant because the Northwest River has elevated

phosphorous, not nitrogen, levels. This argument misses the

point. The record now, unlike before, shows that the Northwest

River is vulnerable because it is impaired from low dissolved

oxygen. It also demonstrates that phosphorous and nitrogen are

both nutrients, and an overabundance of nutrients causes low

dissolved oxygen. Filling the wetlands would prevent them from

trapping nitrogen, which in turn would exacerbate the Northwest

12
River’s dissolved oxygen deficiency by adding nitrogen to the

river’s already elevated phosphorous levels.

Additionally, the record now shows that the Northwest River

has flooded twice in the past fifteen years. And the record

contains evidence of flooding in a subdivision across the Saint

Brides Ditch from Precon’s development. While not particularly

compelling in isolation, this evidence of flooding further

bolsters the Corps’ contention that the wetlands’ functions of

storing water and slowing flow are significant.

The Corps has also documented that the wetlands perform

beneficial functions for food-chain support and wildlife.

Specifically, the Corps determined that fish in “the Northwest

River located downstream from the subject wetlands benefit from

the carbon sequestration occurring in the subject wetlands.”

J.A. 367. 9

9
Carbon sequestration occurs when

vegetation takes in carbon dioxide (CO2) from the
atmosphere as part of the photosynthesis process and the
carbon is incorporated in the vegetation biomass. Carbon,
which is a component of organic material such as leaves, is
also important because it provides food for the bottom
level of the food chain, which in turn supports higher
trophic species such as fish in downstream waters . . . .

J.A. 367.

13
One of Precon’s experts, Dr. Lawrence B. Cahoon, offered a

contrary opinion, which the Corps considered and rejected. In

doing so, the Corps relied on other evidence that headwater

wetlands and streams, like the 448-acre wetlands, 2,500-foot

Ditch, and Saint Brides Ditch, can be “important sources” of

organic matter. J.A. 49. And the Corps noted that the 448-acre

wetlands, the 2,500-foot Ditch, and the Saint Brides Ditch are

mostly wooded, and trees and their leaves contribute organic

matter for carbon sequestration. Once again, we defer to the

Corps’ factual finding on this issue.

In addition, the Corps found that the 448-acre wetlands

provide a habitat for species such as “deer, squirrels,

songbirds, reptiles, and amphibians.” J.A. 368. The Corps also

had evidence from the Virginia Department of Conservation and

Recreation and its own site visits that an endangered species of

rattlesnake inhabits the wetlands. And the Department

documented endangered eastern big-eared bats nearby.

Dr. Cahoon, on the other hand, did not see any fish, wading

birds, fish-eating birds, water fowl, or aquatic mammals when he

visited the area on February 4, 2012. But the Corps again found

Dr. Cahoon’s observations unpersuasive based on its own August

2012 visit during which fish were observed in the 2,500-foot

Ditch where it intersects with the Saint Brides Ditch, and the

undisputed evidence that the wetlands are a habitat for non-

14
aquatic mammals. The Corp’s decision to reject Dr. Cahoon’s

finding was within its discretion, especially given that cold

temperatures and low rainfall in February 2012 made the region

unappealing to fish.

III.

For the above reasons, we hold that the Corps has satisfied

its obligation on remand to marshal evidence in support of its

decision to assert jurisdiction over the disputed wetlands.

Consequently, the district court’s grant of summary judgment to

the Corps is

AFFIRMED.

15
APPENDIX

J.A. 36.