RICHMOND, Va. -- The first appeals decision in the latest round of valley fill lawsuits will rest on questions of how thorough the Army Corps of Engineers' analysis was and what constitutes U.S. waters.

Lawyers representing the Corps and the Ohio Valley Environmental Coalition and other environmental groups appeared Sept. 24 before Judges M. Blane Michael, Roger L. Gregory and Dennis W. Shedd with the 4th Circuit Court of Appeals in Richmond, Va.

During the appellate hearing, lawyers for both sides argued about water and what waterways fall under the scope of "waters of the U.S."

The state, meanwhile, has filed an amicus curiae brief in support of the coal companies' and corps' appeal of a decision that severely limits valley fill permitting in southern West Virginia.

The corps' lawyer argued that water flowing through waste treatment systems in the streams was not U.S. waters but became separate when it was employed by coal mines to filter sediment.

The Ohio Valley Environmental Coalition's lawyer said the corps failed to assess stream functions, ignoring guidelines that required it to assess function and structure. That means the corps could then not properly lessen the pollution's impact on the stream, known as mitigation, because it didn't know the original state of the stream, he said.

Joseph Lovett, an attorney with the Appalachian Center for the Environment and Economy, represented the environmental group. He questioned whether mitigation of headwater streams is possible, denoting the head of the corps said in previous court testimony that there had never been any successes with such efforts.

He also said the corps should have assessed the stream over a period of time instead of taking measurements on one set day.

The corps' attorney, Michael Gray with the Environmental and Natural Resources Division of the Justice Department, argued this was not done because developing and running tests would have been too expensive.

Gray said water used within sediment ponds at the valley fill sites was part of a waste treatment system, and therefore was not U.S. waters and did not fall under the Clean Water Act.

He also said the corps correctly defined the scope of analysis, which the environmental groups' lawyer said was too narrowly construed.

He reiterated several times that when the corps includes national Environmental Protection Act regulations in its analysis, that information only goes into public impact comments in the Clean Water Act. He continued, saying the district engineer said it didn't make sense to duplicate review when it wouldn't affect the decision but would only be included as comments.

Lovett said the entire valley fill was permitted and should have been part of the analysis, but Gray said only the water fill should be included. Gray said corps regulations allow engineers there to determine jurisdictional waters.

Judges with the 4th Circuit Court of Appeals questioned both sides' lawyers about how far the valley fill extended upland toward the stream's headwaters. It was denoted by both that they believed the fill did not extend to the top of the stream.

Shedd said the district court found a savings clause in the federal Surface Mining Control and Reclamation Act does not override the national Environmental Protection Act or Clean Water Act.

Lovett said the corps still must consider both and permitted the mines based on assumptions.

Bob McLusky, an attorney who spoke on behalf of the West Virginia Coal Association, said the stream segment in dispute was part of the treatment system. McLusky also said the district court improperly found that a full assessment was necessary under the guidelines, but that cannot be found there.

A major point of contention for him was that valley fills at three of the four mines, especially at Black Castle Mine, would have improved the water quality, rectifying damage done by earlier mining. Acid drainage there, he said, would be neutralized by rock placed in the fill.

The state Department of Commerce and Department of Environmental Protection have filed a joint amicus curiae brief with the Court of Appeals outlining their support of the coal companies' and corps' appeal.

The Commerce Department is concerned about the decision's effect on the state's economy and tax base and on citizens' welfare. The DEP, meanwhile, maintains that the decision creates regulatory conflicts it cannot reconcile.

The Commerce Department argues in the brief that 637 jobs are in danger, which could have a negative economic impact of $54 million when benefit packages are included. Additionally, millions could be lost from the state tax coffers and in lost revenue to local suppliers.

Sediment control under the federal Surface Mining Control and Reclamation Act is now illegal under the district court's view of the Clean Water Act, according to the DEP's portion of the brief.

Massey Energy is the parent company of four mines at the heart of the lawsuit -- Republic Energy Mine in Fayette County, Camp Branch Mine in Logan County and the Black Castle Mine and Laxare East Mine, both in Boone County. Two cases from the district court level were consolidated into one appeal case.