Chevron, U.S.A., Inc. v. Yost

The Clean Water Act (CWA) stated that there should be no discharges of oil into the waters of the United States. Originally, the law prohibited harmful discharges. The regulations of the Environmental Protection Agency (EPA) stipulated that a discharge would be considered harmful if it left a sheen on the surface of the water; this was known as the sheen test. Several cases held that the sheen test established a rebuttable presumption of harm but that de minimis, harmless discharges were lawful. In 1978, Congress amended 33 U.S.C. §§ 1321(b)(3) and (b)(4) to empower the president of the United States to prohibit discharges of oil and hazardous substances that could be harmful to the public health or welfare. The EPA considered revising its regulations. However, in 1987, the EPA reinstated the sheen test. Chevron, U.S.A., Inc. (Chevron) (defendant) accidentally discharged several small quantities of oil into the waters of the United States on 12 occasions in 1986. The United States Coast Guard (Coast Guard) held hearings concerning these discharges and required Chevron to pay civil penalties ranging from $250 to $1,000 for each discharge. Chevron’s expert witnesses had testified that the spills were de minimis and not harmful. However, the Coast Guard ruled against Chevron in the administrative appeal. Chevron appealed to the federal district court. The district court ruled that because the discharges did not actually harm the environment, the discharges were lawful, and the court ruled in Chevron’s favor. Paul Yost (plaintiff), commandant of the Coast Guard, appealed. On appeal, Chevron argued that the Coast Guard was bound by the earlier cases holding that de minimis spills were lawful.