Under the Clean Water Act, when the federal government brings a civil action against a municipality, the state in which the municipality is located must also be joined as a party.  This requirement exists because that state is liable for any judgment against the municipality to the extent the municipality cannot raise revenue to pay the judgment because of state law.

The federal government intended to bring suit against the Metropolitan St. Louis Sewer District (“district”) for allegedly discharging raw sewage from its sewer system.  Because the Clean Water Act required the State of Missouri to be a party to the litigation, Missouri chose to be a plaintiff but did not bring any separate, state claims against the district.  The district then filed counterclaims against Missouri, arguing that it was entitled to indemnity under the provisions of the Clean Water Act.  Missouri moved to dismiss the counterclaims, arguing that it had sovereign immunity.  The trial court denied the motion, noting that Missouri had waived its sovereign immunity by bringing the lawsuit.

On appeal, the Eighth Circuit Court of Appeals agreed with the trial court, noting that Missouri could have easily been added as a defendant instead of a plaintiff.  The court pointed out that Missouri’s liability is unlikely to exceed the liability it already has under the above provisions of the Clean Water Act.