## Facts

- Rudy Cundiff bought a tract of land in Muhlenberg County, Kentucky, containing about 85 acres of wetlands adjacent to Pond Creek and Caney Creek, tributaries that flow to the Green River and then the Ohio River.
- At purchase, the wetlands contained acidic, discolored water associated with abandoned coal mining runoff; the Cundiffs knew of these conditions.
- Rudy, later joined by his son Seth, attempted to convert the wetlands to farmland by excavating drainage ditches and channels, clearing vegetation, and placing dredged or fill material in wetlands areas.
- Federal and state officials repeatedly warned that the work involved discharges of pollutants into waters of the United States without a permit and issued compliance orders requiring restoration; the Cundiffs did not fully comply.
- The United States sued for civil penalties and injunctive relief requiring restoration under the Clean Water Act (CWA).
- The district court granted summary judgment on liability, ordered a detailed restoration plan, imposed a $225,000 civil penalty (suspending $200,000 conditioned on compliance), and dismissed statutory, common-law, and constitutional counterclaims, including takings theories.
- After an initial appeal, the case was remanded for reconsideration of CWA jurisdiction in light of Rapanos; on remand the district court again found jurisdiction and reinstated the remedies, prompting a second appeal.

## Issues

1. Whether the wetlands were “waters of the United States” under the Clean Water Act after Rapanos, applying the controlling jurisdictional standard.
2. Whether a USDA wetlands-conversion determination under “swampbuster” rules eliminated the need for a CWA § 404 permit for later discharges of dredged or fill material.
3. Whether the district court properly dismissed the defendants’ takings counterclaims for lack of subject-matter jurisdiction.
4. Whether the restoration injunction and civil penalty reflected a permissible exercise of remedial discretion.

## Decision

- The Sixth Circuit affirmed the district court in full.
- The court held the wetlands were within CWA jurisdiction because they had a significant nexus to traditional navigable waters through their connections to tributaries leading to the Green and Ohio Rivers.
- The court held the USDA “swampbuster” determination did not displace or satisfy CWA permitting requirements.
- The court held the takings counterclaims were properly dismissed for lack of jurisdiction.
- The court held the restoration injunction and penalty, including conditional suspension of most of the penalty, were within the district court’s discretion.

## Legal Principles

- Under the controlling post-Rapanos approach in the Sixth Circuit, wetlands fall within the CWA if they have a “significant nexus” to traditional navigable waters, meaning they significantly affect downstream chemical, physical, or biological integrity, including when evaluated with similarly situated lands in the region.
- CWA jurisdiction and permitting do not require proof of continuous or perpetual surface flow; ecological and hydrological functions (e.g., floodwater storage, sediment trapping, and filtering of pollutants) may establish the required nexus.
- USDA “swampbuster” determinations made for federal farm-benefits eligibility do not bind the EPA or Army Corps of Engineers and do not excuse compliance with CWA § 404 permitting.
- Takings claims seeking compensation against the United States generally must be brought in the Court of Federal Claims under the Tucker Act and are not properly litigated as counterclaims in a district court CWA enforcement action.
- District courts have broad equitable authority to order restoration for CWA violations and discretion to assess civil penalties calibrated to the seriousness, duration, and persistence of noncompliance.

## Conclusion

The Sixth Circuit upheld Clean Water Act enforcement against landowners who filled and drained wetlands without permits, concluding the wetlands had a significant nexus to downstream navigable waters, that USDA wetland-conversion determinations did not remove CWA permitting duties, and that takings counterclaims were jurisdictionally misplaced, while affirming restoration and penalty remedies.


United States v. Cundiff, 555 F.3d 200 (6th Cir. 2009), cert. denied, 558 U.S. 818 (2009)