Fourth Circuit Considers New Clean Water Act Functional Equivalence Test in Kinder Morgan Case

The much-discussed April 2020 Clean Water Act ruling in County of Maui v. Hawaii Wildlife Fund left open the critical question of how courts would apply the qualitative test set forth by the U.S. Supreme Court to determine whether, in the case of groundwater contamination that eventually impacts surface waters, the “functional equivalent” of a direct discharge from a point source to a jurisdictional water has occurred.

That question is already being tested in the Fourth Circuit. Less than two weeks after deciding County of Maui, the Supreme Court vacated the Fourth Circuit’s 2018 ruling in Kinder Morgan Energy Partners LP v. Upstate Forever, remanding the case to the Fourth Circuit for further consideration in light of County of Maui. In that case, green groups brought a Clean Water Act citizen suit against Kinder Morgan’s Plantation Pipe Line Co. Inc. unit when its underground gas pipeline ruptured in South Carolina. Plaintiffs alleged that Plantation polluted navigable waters without a permit when leaked gasoline contaminated groundwater and eventually spread into nearby streams and wetlands. In 2018, the Fourth Circuit had generally followed the reasoning of the Ninth Circuit that a discharge via groundwater must be sufficiently connected to navigable waters, and allowed the case to proceed because plaintiffs had sufficiently alleged a direct hydrological connection between groundwater and navigable waters.

But given the 2020 high court ruling, the Fourth Circuit must now review the case again to determine if, under the new functional equivalence test, the Clean Water Act covers the contamination at issue in this particular instance. Recently, both parties submitted briefs to the Fourth Circuit on the significance of County of Maui on the facts in the South Carolina case. Plaintiffs argue that, because the pipeline discharged hundreds of thousands of gallons of fuel that seeped into groundwater 1,000 feet away from a jurisdictional water, the spill was functionally equivalent to a direct discharge from the pipeline to navigable waters. Kinder Morgan argued that plaintiffs failed to make necessary allegations under the high court’s new test, such as how long it took for the petroleum to reach jurisdictional waters, or whether the contaminants were chemically altered as they traveled.

The pending case offers one of the first instances for lower courts to apply the qualitative functional equivalence test to indirect discharges through groundwater. The factors applied in the court’s upcoming decision are likely to be important considerations in future jurisprudence as well. KMCL attorneys welcome the opportunity to answer any questions about the impact of these recent developments on Clean Water Act liability.