Kentucky Chamber defends businesses in a significant lawsuit before the Ky. Supreme Court

The Kentucky Chamber of Commerce recently filed a “friend of the court” brief in a significant lawsuit before the Kentucky Supreme Court regarding permits issued under the federal Clean Water Act.   The litigation involves a waste water discharge permit issued by the Kentucky Energy and Environment Cabinet to a Louisville Gas and Electric Company (LG&E) generating facility.  The Kentucky Chamber has alerted the Supreme Court that if the lower court’s decision is upheld, profound impacts to other Kentucky businesses, as well as businesses looking to locate in Kentucky, would result.

In 2010, several environmental interest groups challenged the permit arguing that it was improper because the Cabinet did not develop and impose limits for certain pollutants present in the facility’s waste stream.  However, the Cabinet wrote the permit based on U.S. Environmental Protection Agency (U.S. EPA) guidance and case law, had determined that it was not required to so since the U.S. EPA had already considered and chose not to set limits for certain pollutants when it developed its guidance.  The U.S. EPA reviewed the permit and did not object.  Nevertheless, the Franklin Circuit Court and Kentucky Court of Appeals (in a 2 to 1 Opinion) rejected the Cabinet’s position, holding that it was obligated under the federal Clean Water Act to use its “best professional judgment” to develop and impose case-by-case limits in those circumstances.  The Kentucky Supreme Court agreed to review the decision.

The Kentucky Chamber supports the Cabinet’s and LG&E’s argument that the lower court’s decision directly disregards the Clean Water Act’s clear legislative goal of promoting national uniformity and an even playing field.  The Kentucky Chamber has urged the Court to consider the serious, and wide-reaching, adverse impacts to Kentucky businesses and Kentucky’s business climate including:

  • Opening thousands of existing discharge permits issued to various types of industries and facilities to challenge
  • Severe delays to the permit process as the Cabinet attempts to perform the judicially mandated, case-by-case reviews for new or modified permits
  • Diminished regulatory consistency, efficiency and predictability that would stem from a process by which ad-hoc, case-by-case limits are imposed for industry categories previously addressed by uniform, nationwide standards
  • Disadvantages to Kentucky when competing for new businesses, for no other state has interpreted the Clean Water Act in this manner.

The Kentucky Chamber will continue to track this case. The brief was filed on behalf of the Kentucky Chamber by Kelly Bartley and Brent Baughman of Bingham Greenebaum Doll LLP.

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