Kansas v Nebraska

Kansas sued Nebraska alleging violations of a settlement agreement implementing an interstate compact covering allocation of the waters of the Republican River. The master ruled Nebraska did violate the agreement, awarded compensatory damages, a disgorgement award and reformed a technical formula on calculating the water to be allocated. Both states filed exceptions. The Court, 6-3 as to disgorgement and 5-4 as to the changes in the technical formula, rejected the exceptions and affirmed. The majority held that in water cases, the court had equitable power to allocate water and the duty to uphold compacts which are federal law. As to disgorgement, the majority held that it was appropriate here as Nebraska failed to promptly change its law to comply with the agreement thereby placing Kansas’ rights at high risk. In order to disincentivize Nebraska and other upstream states from taking more than their fair share of water, the majority approved disgorgement.  While it was unclear as to why the master chose the amount he did, the amount was reasonable given it was less than whole profit enjoyed by Nebraska and Nebraska made changes to its law and administrative process to overconsumption in the future. As to the amendment, the majority held the formula as written did not properly excluded water for other rivers from the calculation and this violated both the understanding of the parties and went beyond the scope of the compact. Chief Justice Roberts added an opinion agreeing that disgorgement was appropriate, disagreeing with the claim of equitable powers and thus agreed with Justice Thomas that eh technical formula could not be changed. Justice Scalia added an opinion denouncing the restatements (which the majority used as part of its reasoning) and calling on all judges to avoid using them for authority. Justice Thomas, joined by Scalia, Alito and Roberts as to the amendment, dissented arguing that in disputes between states, the Court should be reticent to use equitable power and instead stay with eh language of the agreement as compacts are essentially contracts and the states here bargained and Nebraska should be held to that bargain not be given reformation without proof of erroneous drafting.