[Cite as State ex rel. Yost v. Rover Pipeline, L.L.C., 2019-Ohio-5179.]
COURT OF APPEALS
STARK COUNTY, OHIO
FIFTH APPELLATE DISTRICT
STATE OF OHIO, EX REL., JUDGES:
DAVE YOST, OHIO Hon. William B. Hoffman, P.J.
ATTORNEY GENERAL Hon. John W. Wise, J.
Hon. Patricia A. Delaney, J.
Plaintiff-Appellant
-vs-
Case No. 2019CA00056
ROVER PIPELINE, LLC; PRETEC
DIRECTIONAL DRILLING, LLC; MEARS
GROUP, INC.; LANEY DIRECTIONAL
DRILLING CO.; ATLAS TRENCHLESS,
LLC; AND B & T DIRECTIONAL
DRILLING, INC.
Defendants-Appellees O P I N IO N
CHARACTER OF PROCEEDINGS: Appeal from the Stark County Court of
Common Pleas, Case No. 2017-CV-
02216
JUDGMENT: Affirmed
DATE OF JUDGMENT ENTRY: December 9, 2019
APPEARANCES:
For Plaintiff-Appellant For Defendant-Appellee Mears Group,
Inc., LLC
DAVE YOST
Ohio Attorney General FREDERIC (“FRITZ”) X. SHADLEY
AARON S. FARMER DAVID A. MEYER
JANEAN R. WEBER 600 Vine Street, Suite 2800
AMANDA M. FERGUSON Cincinnati, Ohio 45202
Environmental Enforcement Section
Assistant Attorney General
30 East Broad Street, 25th Floor
Columbus, Ohio 43215
Stark County, Case No. 2019CA00056 2
For Defendant-Appellee Rover For Defendant-Appellee Laney
Pipeline, LLC Directional Drilling Co.
STEPHEN H. DANIELS THOMAS A. KNOTH
MICHAEL S. MCMAHON J. WRAY BLATTNER
McMahon DeGulis LLP Thompson Hine LLP
The Caxton Building 10050 Innovation Drive, Suite 400
812 Huron Road, E., Suite 650 Miamisburg, Ohio 45342
Cleveland, Ohio 44115
For Defendant-Appellee Pretec
Directional Drilling, LLC
WILLIAM S. SCHERMAN (pro hac vice admitted)
DAVID DEBOLD (pro hac vice admitted) JOSEPH P. KONCELIK
JASON FLEISCHER (pro hac vice admitted) ANTHONY R. PETRUZZI
RUTH PORTER (pro hac vice admitted) MELISSA Z. KELLY
Gibson, Dunn & Crutcher LLP Tucker Ellis LLP
1050 Connecticut Avenue, N.W. 950 Main Avenue, Suite 1100
Washington, DC 20036 Cleveland, Ohio 44113-7213
For Defendant-Appellee B & T For Defendant-Appellee Atlas
Directional Drilling Inc. Trenchless, LLC
GRANT J. KEATING PHILIPS J. VALLAKALIL
Dworken & Bernstein Co., LPA Atlas Trenchless, LLC
60 South Park Place 520 S. 6th Avenue
Painesville, Ohio 44077 Mansfield, TX 75054
For Amicus Curiae Sierra Club KEVIN L. MURPHY
J. JEFFREY LANDEN
RICHARD C. SAHLI MICHAEL S. JONES
Richard Sahli Law Office, LLC MURPHY LANDEN JONES PLLC
981 Pinewood Lane 2400 Chamber Center Drive, Suite 200
Columbus, Ohio 43230-3662 Fort Mitchell, KY 41017-0534
NATHAN D. MATTHEWS
2101 Webster Street, Suite 1300
Oakland, CA 94612
Stark County, Case No. 2019CA00056 3
Hoffman, P.J.
{¶1} Appellant State of Ohio, ex rel. Dave Yost, Ohio Attorney General, appeals
the judgment of the Stark County Common Pleas Court dismissing its complaint against
Appellees Rover Pipeline, LLC; Mears Group, Inc.; Pretec Directional Drilling, LLC; Laney
Directional Drilling Co.; Atlas Trenchless, LLC; and B&T Directional Drilling, Inc.
STATEMENT OF THE CASE AND FACTS
{¶2} On July 19, 2018, Appellant filed a third amended complaint, the dismissal
of which is the entry appealed from in the instant action. The complaint alleged Appellees
illegally discharged millions of gallons of drilling fluids into Ohio’s waters, causing pollution
and degrading water quality across the state during construction of the Rover Pipeline, a
713-mile interstate natural gas pipeline crossing 18 Ohio counties. Appellee Rover was
the owner/operator of the drilling operation for construction of the pipeline. The remaining
Appellees were subcontractors hired by Rover to perform horizontal-directional drilling
related to construction of the pipeline. Appellant sought civil penalties and injunctive
relief.
{¶3} Specifically, Appellant’s complaint alleged the following:
Count one: Appellees discharged pollutants (drilling fluids) into the
waters of the state without point source NPDES permits.
Count two: Appellee Rover failed to obtain a necessary storm water
permit for its storm water discharges.
Count three: Appellees violated Ohio’s general water quality
standards (unpermitted drilling fluid discharges and storm water discharges
into waters of the state).
Stark County, Case No. 2019CA00056 4
Count four: Appellees violated Ohio’s wetland water quality
standards by unpermitted drilling fluid discharges into wetlands.
Count five: Appellee Rover violated the Director of the EPA’s orders
by failing to obtain coverage or submit a notice of intent to obtain coverage
for a Construction Storm Water Permit.
Count six: Appellee Rover violated the hydrostatic permit laws.
Count seven: Appellee Rover engaged in activity from February 14,
2017 through May 15, 2017, without the state 401 water quality certification.
{¶4} Appellees moved to dismiss the complaint pursuant to Civ. R. 12(B)(1) and
(6), raising four basic arguments.
{¶5} First, Appellees argued Appellant’s failure to act within one year on Rover’s
November 16, 2016, application for the State to issue a §401 certification under the
federal Clean Water Act resulted in the State waiving its power to impose conditions and
enforce environmental requirements for the pipeline project as a matter of federal law.
{¶6} Second, Appellees argued Rover received all necessary regulatory
approvals from FERC (Federal Energy Regulatory Commission). They argued Appellant
participated in the preparation of an Environmental Impact Statement (EIS) as a part of
the process of obtaining FERC approval, and failed to identify additional State permitting
requirements through the EIS process.
{¶7} Third, Appellees argued the State’s claims are preempted by the Natural
Gas Act, and the trial court therefore lacked subject matter jurisdiction.
Stark County, Case No. 2019CA00056 5
{¶8} Fourth, Appellees argued the State’s claims are an improper collateral
attack on FERC’s orders approving the pipeline project.
{¶9} Appellant responded Counts 1-6 were not subject to Section 401
certification. As to Count Seven, Appellant argued waiver did not apply because Rover
reapplied for Section 401 certification on February 23, 2017, and the State granted the
revised request on February 24, 2017.
{¶10} The trial court granted Appellees’ motion to dismiss on March 12, 2019.
The court found by failing to act on Rover’s November 16, 2015, request for 401
certification, Appellant waived its rights under the Clean Water Act. The court found the
resubmission of the request for certification on February 23, 2017, did not save the State
from waiver, as the request was resubmitted outside the one-year period for action on the
initial submission.
{¶11} It is from the March 12, 2019 judgment of the trial court Appellant
prosecutes this appeal, assigning as error:
I. THE TRIAL COURT ERRED AS A MATTER OF LAW WHEN IT
HELD THAT, UNDER THE CLEAN WATER ACT, 33 U.S.C. 1341, THE
STATE OF OHIO WAIVED ALL OF ITS WATER POLLUTION AUTHORITY
OVER ENVIRONMENTAL VIOLATIONS OCCURRING DURING THE
CONSTRUCTION OF ROVER’S INTERSTATE PIPELINE.
II. THE TRIAL COURT ERRED AS A MATTER OF LAW WHEN IT
FOUND, IN A FOOTNOTE, THAT EVEN WITHOUT WAIVER, THE OTHER
DEFENSES RAISED BY ROVER AND ITS CONTRACTORS INCLUDING
Stark County, Case No. 2019CA00056 6
PREEMPTION BARRED THE STATE OF OHIO’S COUNTS ONE
THROUGH SIX.
I.
{¶12} Appellant argues the court erred in finding its failure to act in a timely
manner on Rover’s application for Section 401 certification waived its rights to enforce
Ohio’s Clean Water Act in regards to the violations alleged in Counts One through Six of
its third amended complaint.1
{¶13} The trial court dismissed the complaint pursuant to Civ. R. 12(B)(1), lack of
subject matter jurisdiction and Civ. R. 12(B)(6), failure to state a claim upon which relief
could be granted. An order granting a Civ.R. 12(B)(1) or a 12(B)(6) motion to dismiss is
subject to de novo review. Moody v. Frazeysburg, 5th Dist. Muskingum No. CT2005-
0037, 167 Ohio App.3d 106, 2006-Ohio-3028, 854 N.E.2d 212, ¶ 9; Perrysburg Twp. v.
Rossford, 103 Ohio St.3d 79, 2004-Ohio-4362, 814 N.E.2d 44, ¶ 5. In determining
whether the plaintiff has alleged a cause of action sufficient to withstand a Civ.R. 12(B)(1)
motion to dismiss, a court is not confined to the allegations of the complaint and may
consider material pertinent to the inquiry without converting it into a motion for summary
judgment. Moody, supra, citing Southgate Dev. Corp. v. Columbia Gas Transm. Corp.,
48 Ohio St.2d 211, 2 O.O.3d 393, 358 N.E.2d 526, paragraph one of the syllabus (1976).
{¶14} The Federal Clean Water Act specifically reserves to the states the right to
adopt and enforce standards and requirements regarding pollutants in its waterways:
1Appellant states in its brief, “While the State disagrees with the conclusion below that it waived Count
Seven, the State seeks review of the trial court’s dismissal of the water pollution claims alleged in Counts
One through Six only.” Brief of Appellant, page 6.
Stark County, Case No. 2019CA00056 7
Except as expressly provided in this chapter, nothing in this chapter
shall (1) preclude or deny the right of any State or political subdivision
thereof or interstate agency to adopt or enforce (A) any standard or
limitation respecting discharges of pollutants, or (B) any requirement
respecting control or abatement of pollution; except that if an effluent
limitation, or other limitation, effluent standard, prohibition, pretreatment
standard, or standard of performance is in effect under this chapter, such
State or political subdivision or interstate agency may not adopt or enforce
any effluent limitation, or other limitation, effluent standard, prohibition,
pretreatment standard, or standard of performance which is less stringent
than the effluent limitation, or other limitation, effluent standard, prohibition,
pretreatment standard, or standard of performance under this chapter; or
(2) be construed as impairing or in any manner affecting any right or
jurisdiction of the States with respect to the waters (including boundary
waters) of such States.
{¶15} 33 U.S.C. 1370.
{¶16} Ohio has delegated to its Director of Environmental Protection the authority
to promulgate rules and regulations, including issuing permits, concerning the discharge
of pollutants into the State’s waters. R.C. 6111.03. These rules and regulations are found
in Ohio Administrative Code Chapter 3745.
{¶17} The Federal Clean Water Act further provides any project in which
discharge of a pollutant into navigable waters occur must receive certification from the
Stark County, Case No. 2019CA00056 8
state in which the discharge will originate. This certification, referred to as the “401
certification,” is governed by 33 U.S.C. §1341(a)(1), which provides:
Any applicant for a Federal license or permit to conduct any activity
including, but not limited to, the construction or operation of facilities, which
may result in any discharge into the navigable waters, shall provide the
licensing or permitting agency a certification from the State in which the
discharge originates or will originate, or, if appropriate, from the interstate
water pollution control agency having jurisdiction over the navigable waters
at the point where the discharge originates or will originate, that any such
discharge will comply with the applicable provisions of sections 1311, 1312,
1313, 1316, and 1317 of this title. In the case of any such activity for which
there is not an applicable effluent limitation or other limitation under sections
1311(b) and 1312 of this title, and there is not an applicable standard under
sections 1316 and 1317 of this title, the State shall so certify, except that
any such certification shall not be deemed to satisfy section 1371(c) of this
title. Such State or interstate agency shall establish procedures for public
notice in the case of all applications for certification by it and, to the extent
it deems appropriate, procedures for public hearings in connection with
specific applications. In any case where a State or interstate agency has no
authority to give such a certification, such certification shall be from the
Administrator. If the State, interstate agency, or Administrator, as the case
may be, fails or refuses to act on a request for certification, within a
Stark County, Case No. 2019CA00056 9
reasonable period of time (which shall not exceed one year) after receipt of
such request, the certification requirements of this subsection shall be
waived with respect to such Federal application. No license or permit shall
be granted until the certification required by this section has been obtained
or has been waived as provided in the preceding sentence. No license or
permit shall be granted if certification has been denied by the State,
interstate agency, or the Administrator, as the case may be. (Emphasis
added).
{¶18} 33 U.S.C. § 1341(d) further provides:
Any certification provided under this section shall set forth any
effluent limitations and other limitations, and monitoring requirements
necessary to assure that any applicant for a Federal license or permit will
comply with any applicable effluent limitations and other limitations, under
section 1311 or 1312 of this title, standard of performance under section
1316 of this title, or prohibition, effluent standard, or pretreatment standard
under section 1317 of this title, and with any other appropriate requirement
of State law set forth in such certification, and shall become a condition on
any Federal license or permit subject to the provisions of this section.
{¶19} “The plain language of Section 401 outlines a bright-line rule regarding the
beginning of review: the timeline for a state’s action regarding a request for certification
Stark County, Case No. 2019CA00056 10
‘shall not exceed one year’ after receipt of such request.’” New York State Dept. of
Environmental Conservation v. Fed. Energy Regulatory Commission, 884 F.3d 450, 455
(2nd Cir. 2018). Further, the withdrawal and resubmission of requests for certification
does not extend the time beyond one year from the original request, as resubmissions of
requests involving the same project are not independent requests, subject to a new period
of review. Hoopa Valley Tribe v. Fed. Energy Regulatory Commission, 913 F.3d 1099,
1104 (D.C. Cir. 2019), reh'g denied, 2019 WL 3928669.
{¶20} It is undisputed in this case Appellant failed to act on Rover’s original
certification request within one year of November 16, 2015. Further, while Appellant
appears to have abandoned on appeal its argument the resubmission of the certification
request on February 23, 2017, restarted the one-year time period, pursuant to Hoopa
Valley, supra, we find the trial court did not err in finding the resubmission did not restart
the one year period within which the State must act on a request for certification.
{¶21} Appellant first argues Section 401(d)(1)’s language stating the certification
“shall” set forth any conditions in a timely certification has been interpreted by the courts
to read “may.” Appellant argues pursuant to O.A.C. 3745-32-02(A), Section 401
certification applies solely to fill dirt, and does not apply to discharge of drilling fluids or
stormwater.
{¶22} Appellant cites this court to PUD No. 1 of Jefferson County v. Washington
Dept. of Ecology, 511 U.S. 700, 713-714 (1994), and Great Basin Mine Watch v. Hankins,
456 F3d 955, 963 (9th Cir. 2006) in support of its argument we should interpret the
language of Section 401(d)(1) to read “may,” thus reserving their rights over the types of
effluents set forth in counts one through six of the complaint.
Stark County, Case No. 2019CA00056 11
{¶23} We find these cases distinguishable from the issue presented in the instant
case. PUD No. 1 dealt with the question of whether a State could only impose water
quality limitations specifically tied to a discharge. In finding Section 401(d)(1) allowed a
state to impose water quality standards to other types of activities not involving
discharges, the United States Supreme Court held the states “may condition certification
upon any limitations necessary to ensure compliance with state water quality standards.”
Id. at 713-714. In Great Basin Mine Watch, the court held, “PUD No. 1 merely holds that
states may set minimum flow standards as part of section 401 certification requirements;
it does not hold that states must do so.” 456 F.3d at 963. However, the issue in Great
Basin was not whether the state could waive its rights to enforce its water pollution
statutes by failing to timely act on a certification or to include all types of pollution in its
certification process, but rather whether Congress can force a state to issue a 401
certification or to include specific conditions when it does so. Neither of these cases stand
for the proposition the clear language of the statute should be changed from “shall” to
“may” when considering the issue of whether a state has waived its right to participate in
the certification process.
{¶24} Appellant also cites this court to Ohio Administrative Code 3745-32-02(A)
which provides, “Any applicant for a federal license or permit to conduct any activity which
may result in a discharge of dredged or fill material to a water of the state shall apply for
and obtain a 401 certification from Ohio EPA.” Appellant argues pursuant to this state
administrative code section, 401 certification in Ohio only applies to the discharge of
dredged or fill material, and thus does not apply to the types of discharges in counts one
through six of the complaint, which are governed by other regulatory schemes in Ohio.
Stark County, Case No. 2019CA00056 12
{¶25} However, we note 33 U.S.C. §1341(a)(1) is not limited to dredged or fill
material, but specifically applies to any discharge into the navigable waters. Further, 33
U.S.C. §1341(d) provides the certification “shall set forth any effluent limitations and other
limitations, and monitoring requirements necessary to assure that any applicant for a
Federal license or permit will comply with any applicable effluent limitations and other
limitations,” again without limiting the certification process to dredged or fill material.
{¶26} A state receiving a Section 401 application has four options: it may grant a
certificate without imposing any additional conditions, grant it with additional conditions,
deny it, or waive its right to participate in the process. Sierra Club v. State Water Control
Bd., 898 F.3d 383, 388 (4th Cir. 2018). If we accept Appellant’s argument Ohio
Administrative Code 3745-32-02(A) demonstrates Ohio’s participation in the certification
process is limited solely to activities which result in the discharge of dredged or fill material
into the waters of the state, then Ohio has waived its right to participate in the certification
process as to all activities other than those involving dredged and fill material, despite the
clear language of the United States Code allowing much broader participation. As
Appellee Rover states in its brief, “In short, States have choices; and their choices have
consequences.” Brief of Appellees Rover Pipeline LLC and Mears Group, Inc., page 21.
{¶27} Appellant argues it could not anticipate the extent of the types of pollution
the pipeline project would generate at the time of the certification request. The record
reflects the Ohio EPA participated in the preparation of the Environmental Impact
Statement in the instant case, which provided a sweeping exploration of the scope of the
pipeline project. From its active participation in the EIS process, Appellant should have
been aware of the types of pollution the project would be likely to generate. Further, the
Stark County, Case No. 2019CA00056 13
State could have simply denied the certification based on a lack of information, or granted
it by imposing additional conditions subjecting all types of discharge to compliance with
the laws of Ohio. See Sierra Club, supra. However, the state failed to act on the
certification request in a timely manner, thereby waiving its right to participation in the
certification process.
{¶28} Appellant also argues the trial court’s interpretation of the certification rules
runs contrary to the overarching intent of the Federal Clean Water Act. We agree with
the findings of the trial court to the contrary:
The holding of this Court in no way stands for the position that the
State of Ohio does not have rights relative to the construction of a natural-
gas pipeline through the State and a right to impose regulations to curb
disastrous environmental impacts on its waterways as a result of such
construction. Nor does this holding provide natural gas companies carte
blanche to perform drilling and other construction related to natural-gas
lines regardless of the environmental impact of such action. Rather, in order
to assert its rights, the State of Ohio is required to act in conformance with
the Clean Water Act, as opposed to instigating litigation as a collateral
attack subsequent to the completion of a pipeline. Moreover, the Court finds
that, despite the State of Ohio’s inability to pursue the instant litigation, all
aspects of the construction of the pipeline, including the discharging of
pollutants into waterways, were subject to oversight by FERC, which
responded to environmental concerns presented by the State of Ohio,
Stark County, Case No. 2019CA00056 14
including, but not limited to, halting construction operations. As such, any
alleged discharges were still subject to Federal Regulations, including the
Clean Water Act.
{¶29} Judgment Entry, March 12, 2019, pp. 9-10.
{¶30} Finally, Appellant argues the court erred in dismissing count six of its
complaint regarding hydrostatic water, because Appellees did obtain a permit concerning
hydrostatic water from the Ohio EPA, which was listed in the Environmental Impact
Statement.
{¶31} We find a state’s 401 waiver cannot be undone by agreement of the parties.
See Hoopa Valley, supra, at 1105 (state waived participation in certification despite
applicant’s agreement with state in withdrawal and resubmission of certification request
in attempt to extend one year time deadline). The mere fact Appellees chose to obtain a
certificate from the state, as set forth in the EIS, does not change the fact the state waived
its right to enforce its hydrostatic water laws by failing to include such permit requirement
in a timely issued 401 certificate.
{¶32} The first assignment of error is overruled.
II.
{¶33} Any discussion of Appellant’s second assignment of error is rendered moot
by our disposition of the first assignment of error.
Stark County, Case No. 2019CA00056 15
{¶34} The judgment of the Stark County Common Pleas Court is affirmed.
By: Hoffman, P.J.
Wise, John, J. and
Delaney, J. concur
State ex rel. Yost v. Rover Pipeline, L.L.C.
Combined Opinion