In this action, five states bordering the Great Lakes and an Indian tribe assert that the Asian carp either will soon invade, or perhaps already have invaded, the Great Lakes and that they are poised to inflict billions of dollars of damage on the ecosystem. Believing that the responsible units of government have failed in their task of protecting the Great Lakes, the plaintiffs ask us to step in and impose measures to ensure that the carp are forever blocked from the Lakes.

This problem did not develop overnight. Beginning in the early 20th century, state and federal authorities constructed a series of canals and channels that connect Lake Michigan with the Mississippi River. One part of that system is now called the Chicago Area Waterway System (CAWS). It has been vital to the growth and development of the Chicago region and the surrounding Midwest. In addition to reversing the flow of the Chicago River in order to carry Chicago’s wastewater away from, rather than into, Lake Michigan, the CAWS also established a navigable link between two of the country’s most important bodies of water. The CAWS is not the only place where the Mississippi basin and the Great Lakes intersect, but it is the one at issue in our case.

The other part of the problem dates from the 1970s, when aquatic farmers in the southern United States introduced bighead and silver Asian carp to their facilities in the hope that the fish would control unwanted plant growth. Flooding in the region, however, enabled the carp to move beyond the farms out into open freshwater systems, and ultimately to work their way up the Mississippi River to within six miles of Lake Michigan…. A fish kill conducted near St. Louis in 1999 showed that the Asian carp constituted over 95% of the biomass in the Mississippi at that place and time….

This appeal takes us into the sometimes-murky area of federal common law. Despite the pronouncement in Erie R. Co. v. Tompkins (1938), that “[t]here is no federal general common law,” enclaves of federal common law remain. One such enclave exists for cases dealing with “air and water in their ambient or interstate aspects ….” Illinois v. City of Milwaukee (Milwaukee I) (1972).

Environmental protection is an area “‘within the national legislative power ’ … in which federal courts may fill in ‘statutory interstices’ and, if necessary, even ‘fashion federal law.’ Federal courts look first to state law for this purpose, and even when borrowing the law of a particular State would be inappropriate, they are to remain mindful that federal courts do not have creative power akin to that vested in Congress. Federal common law also can be displaced “when Congress addresses a question previously governed by a decision rested on federal common law.” …

A public nuisance is “an unreasonable interference with a right common to the general public,” usually involving a significant interference with public health, safety, peace, comfort, or convenience…. Many types of conduct have been found to be a public nuisance: for example, one state’s introduction of typhoid into a river that runs off into another state; the discharge of “noxious gas” from one state’s copper works into the other state; and changes to a state’s drainage system that cause flooding in the farmland of another state. States may bring a federal common law claim to vindicate not only their interests in state property or property held in public trusts, but also in a quasi-sovereign capacity to challenge activity “harmful to their citizens’ health and welfare.” …

Before we address whether the States have stated a public nuisance claim, we must resolve a question we left open in Asian Carp I: whether it is legally possible to state a public nuisance claim against an agency of the federal government. This is a different question from whether the government enjoys sovereign immunity from such claims. Sovereign immunity, when it exists, cuts off a plaintiff’s ability to sue the government. Here we are concerned with the question whether the United States itself can create a nuisance, or if the law adopts the fiction that any action taken by the federal government is by definition in the public interest and therefore cannot be characterized as an unreasonable interference with a public right….

One might think that the federal common law doctrine of public nuisance exists only to create a uniform rule for resolving disputes between states in a way that comports with the national interest. On that view, the federal government is outside the scope of the doctrine, because its actions are by definition in the national interest.

There is another perspective, however, and we find it more persuasive. Federal public nuisance actions protect the interests of the public against harms created by an actor ’s conduct that impinges on a public right. Whether such harm is caused by a state or federal entity bears little relevance to the doctrine’s purpose, which is to protect the endangered right. And though the federal government is always at liberty to define what constitutes an unreasonable interference with a public right through legislation, the doctrine already accounts for this by contemplating displacement of federal common law when Congress has spoken directly to the question at issue….

For reasons including the limited scope of their delegated authority and the possibility of agency capture, we have no interest in sustaining a fiction that executive agencies’ undertakings so uniformly reflect the general interest of the public that they should be impervious to public nuisance liability….

Holding that federal agencies can be sued for creating a public nuisance is consistent with the rule that actions authorized by statute or regulation do not give rise to nuisance liability. In this connection, it is important to distinguish between legislative and executive functions. When Congress passes a statute, it weighs the competing public interests that would be served. Activities commanded or authorized by that statute reflect the public interest and so cannot be unreasonable intrusions on a public right. Quasi-legislative agency action is similar; agency rules promulgated pursuant to congressional delegation enjoy the same presumption that they reflect the public interest.

By contrast, agency action that reflects only the agency’s choice of a particular course of action to implement a policy may or may not be consistent with the underlying statute and regulations. The Restatement reflects this distinction when it recognizes that a “statute, ordinance, or administrative regulation” may authorize action, rather than making the bolder assertion that any action taken by the government cannot create a public nuisance….