## Facts

- EPA issued general pretreatment regulations governing “industrial users” that discharge into publicly owned treatment works (POTWs) under Clean Water Act (CWA) § 307, codified at 40 C.F.R. pt. 403.
- EPA also issued categorical pretreatment standards for electroplating operations under the same statutory authority, codified at 40 C.F.R. pt. 413.
- Multiple industry and municipal entities petitioned for review in consolidated proceedings, challenging both the general pretreatment regulations and aspects of the electroplating standards.
- Petitioners focused heavily on EPA’s “prohibited discharge” rule, which barred discharges that “pass through” a POTW or “interfere” with its operation.
- In 1982 amendments to the general rules, EPA defined “interference” to include disruptions that caused or significantly contributed to a POTW permit violation or sludge-use/disposal problem, and described when a user “significantly contributed” (e.g., exceeding allowed daily loads, atypical discharges, or knowledge of likely resulting violations).
- Petitioners argued EPA’s approach effectively imposed liability on industrial users for POTW problems not attributable to them and shifted primary compliance responsibility from POTWs to indirect dischargers, contrary to CWA structure and legislative history.
- EPA contended its definition still required causation between the user’s discharge and the POTW’s violation or sludge problem.

## Issues

1. Whether EPA’s general pretreatment regulations—particularly the amended definition of “interference” and related enforcement concept—were consistent with CWA § 307 and the statute’s allocation of responsibility between POTWs and indirect dischargers.
2. Whether challenged aspects of EPA’s pretreatment rules were arbitrary and capricious under the Administrative Procedure Act (APA).
3. Whether the electroplating categorical pretreatment standards were within EPA’s statutory authority and reasonably supported by the administrative record.

## Decision

- The court applied APA “arbitrary and capricious” review, requiring EPA to act within statutory limits and to provide a rational explanation connected to the administrative record.
- The court granted the petitions in part and denied them in part.
- The court upheld most of EPA’s pretreatment framework and sustained the electroplating categorical standards against the challenges presented.
- The court invalidated and remanded certain provisions of the general pretreatment regulations tied to EPA’s “interference” definition and its operation, concluding those portions did not reasonably implement CWA § 307 as interpreted in light of statutory structure and legislative history.
- The court declined to rewrite the defective provisions itself and remanded them to EPA for revision consistent with the opinion.

## Legal Principles

- CWA § 307 pretreatment standards for indirect dischargers must target harms such as pass-through, interference with POTW operations, and sludge-related problems, consistent with the statute’s design.
- The CWA maintains POTWs as the primary entities responsible for meeting their discharge permit obligations; pretreatment rules may not convert industrial users into general guarantors of POTW compliance.
- Under APA review, EPA receives deference on technical judgments when supported by the record, but regulations will be set aside when inconsistent with statutory structure or inadequately justified by the agency’s stated reasoning and the record.
- A regulatory definition that risks imposing liability without a sufficient causal link between an industrial user’s discharge and a POTW violation or sludge problem may exceed EPA’s pretreatment authority under § 307.

## Conclusion

The Third Circuit largely sustained EPA’s pretreatment program and electroplating standards, but vacated and remanded parts of the general pretreatment regulations governing “interference” because they threatened to reallocate CWA compliance responsibility from POTWs to industrial users and were not adequately grounded in the statutory scheme.


Nat'l Ass'n of Metal Finishers v. U.S. Envtl. Prot. Agency, 719 F.2d 624 (3d Cir. 1983)