Ctr. for Biological Diversity v. U.S. Forest Serv.

Center for Biological Diversity, et al., Plaintiffs, v. U.S. Forest Service, et al., Defendants.

Case No. 2:17-cv-372

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF OHIO EASTERN DIVISION

March 8, 2021

Judge Michael H. Watson

Magistrate Judge Jolson

OPINION AND ORDER

This Court previously found that Defendants United States Forest Service ("USFS") and Bureau of Land Management ("BLM," together "Agency Defendants") violated the National Environmental Policy Act ("NEPA") when they failed to take the requisite "hard look" at the impacts of fracking in Wayne National Forest ("WNF") prior to deciding to grant leases. ECF No. 110. Specifically, this Court found that:

[A]t the decision-to-lease phase, USFS and BLM failed to take a hard look at the impacts of fracking in the WNF, including: (1) surface area disturbance, (2) cumulative impacts on the Indiana Bat and the Little Muskingum River, and (3) impacts on air quality.

Id. at 71.

The Court instructed the parties¹ to brief which remedies other than complete vacatur or mere remand were available and the appropriate test orstandard to apply. Id. at 71-72. Pursuant to that Opinion, the parties filed supplemental briefing as to the appropriate remedy.²

I. BACKGROUND

The Court adopts and incorporates the facts and procedural history as discussed in its previous Opinion and Order, ECF No. 110. Any additional facts relevant to remedies will be addressed in the analysis below.

II. ANALYSIS

A. Whether to Apply Allied-Signal

The parties disagree as to the appropriate test to apply. Plaintiffs argue that under the Administrative Procedure Act ("APA") and Sixth Circuit precedent, the Court must vacate agency actions that violated NEPA. Pls.' Br. 3, ECF No. 111 (citing 5 U.S.C. § 706(2)(A) and Ky. Riverkeeper, Inc. v. Rowlette, 714 F.3d 402, 407, 411 (6th Cir. 2013)); see also Dine Citizens Against Ruining Our Env't v. Bernhardt, 923 F.3d 831 (10th Cir. 2019) ("Vacatur of agency action is a common, and often appropriate form of injunctive relief granted by district courts." (internal citation omitted)).

Agency Defendants and Eclipse acknowledge that the default is to set aside unlawful agency actions, but they, along with Intervenor Associations, argue that this Court should adopt the vacatur exception test established in Allied-Signal v. United States Nuclear Regulatory Comm'n, 988 F.2d 146, 150-51 (D.C. Cir. 1993), which permits remand without vacatur.³ Allied-Signal held that "[a]n inadequately supported rule . . . need not necessarily be vacated." Id. at 150. Instead, the court can employ a two-factor balancing test which looks at "the seriousness of the order's deficiencies (and thus the extent of doubt whether the agency chose correctly) and the disruptive consequences of an interim change that may itself be changed" to determine whether vacatur is appropriate. Id. at 150-51 (internal citation omitted). Neither factor is dispositive; rather, the "resolution of the question turns on the Court's assessment of the overall equities and practicality of the alternatives." Shands Jacksonville Med. Ctr. v. Burwell, 139 F. Supp. 3d 240, 270 (D.D.C. 2015) (collecting cases).

Here, no party disputes that the "ordinary practice" in situations like this is "to vacate unlawful agency action." Standing Rock Sioux Tribe v. U.S. Army Corps. of Eng'rs, 985 F.3d 1032, 1050-51 (D.D.C. 2021). But the Court agrees with Intervenor Associations', Eclipse's, and Agency Defendants' arguments thatPlaintiffs overstate the binding nature of Kentucky Riverkeepers regarding mandatory vacatur. Although the Sixth Circuit Court of Appeals did invalidate a permit pursuant to § 706(2)(A), it did not dictate vacatur as the only permissible outcome. See 714 F.3d at 413.

Instead, this Court looks to the guidance of many other courts that have considered the value of implementing the Allied-Signal test when determining an appropriate remedy and finds it is likewise instructive in this case. See e.g. Black Warrior Riverkeeper, Inc. v. U.S. Army Corps of Eng'rs, 781 F.3d 1271, 1290 (11th Cir. 2015) (noting most other courts agree that the "remedy of remand without vacatur is within a reviewing court's equity powers under the APA" and applying the Allied-Signal test); Eclipse Resp. 9, ECF No. 113 (collecting cases that have adopted the Allied-Signal test); see also Terry v. Tyson Farms, Inc., 604 F.3d 272, 278 (6th Cir. 2010) ("[W]hile we recognize that we are not bound by the law of other Circuits, this court has also routinely looked to the majority position of other Circuits in resolving undecided issues of law."). Although not dispositive of the issue, the Court is persuaded by the fact that most courts to examine the issue have likewise adopted the Allied-Signal test. Moreover, Plaintiffs do not point to any caselaw outright rejecting Allied-Signal or the Court's ability to fashion an equitable remedy narrower than vacatur. Accordingly, while recognizing that the default is vacatur, the Court will employ the Allied-Signal test to determine whether, in equity, complete vacatur is the most appropriate remedy.

Finally, under Allied-Signal, courts have found that the burden is on the party opposing vacatur "to show that compelling equities demand anything less than vacatur." W. Watersheds Project v. Zinke, 441 F. Supp. 3d 1042, 1083 (D. Idaho 2020). Thus, the Court places the burden on Defendants to prove that vacatur is an inappropriate remedy.

B. Application of Allied-Signal

Intervenor Associations, Eclipse, and Agency Defendants argue that vacatur is a drastic remedy, and that, in this case, a simple remand to the Agency Defendants to undergo the requisite "hard look" would be sufficient. Plaintiffs argue that the opposing parties are trying to make the exception the rule, and that, regardless, even under Allied-Signal, vacatur of the challenged decisions and corresponding leases is most in line with NEPA's overarching goal of meaningfully evaluating environmental impacts and alternatives before action is taken. Pls.' Br. 5-6, ECF No. 111.

1. Seriousness of the deficiencies

The parties first disagree as to the seriousness of the deficiencies. Intervenor Associations, Eclipse, and Agency Defendants all contend that the inadequacies highlighted by the Court's previous Opinion and Order can be cured on remand. They further argue that in cases where the NEPA analysis was inadequate, as opposed to completely missing, remand without vacatur is the proper course of action because it is likely the NEPA violations can be corrected upon remand. See Eclipse Resp. 13-14, ECF No. 113; Agency Defs.'Resp. 10, ECF No. 12; Int. Ass'n Resp. 7, ECF No. 112. Indeed, BLM's representative avers that he believes the deficiencies outlined by the Court can be cured by additional NEPA analysis on remand. See Bobo Decl. ¶ 7, ECF No. 115-1.

Plaintiffs argue the seriousness of the defect "should be measured by the effect the error has in contravening the purposes of the statute[s] in question," rather than assessing the seriousness based on the likelihood of curing defects on remand. Pls.' Br. 12, ECF No. 111 (quoting W. Watersheds Project, 441 F. Supp. 3d at 1083 (further citations omitted)). In Plaintiffs' view, because the purposes of NEPA require the agencies to fully consider the environmental impacts of fracking before deciding to lease parcels, vacatur of the leases is the only way to permit full and fair consideration of alternatives on remand. Pls.' Br. 14, ECF No. 111. Absent vacatur, Plaintiffs caution remanding with the leases remaining in place "could result in a pro forma exercise in support of a predetermined outcome." Id. at 6 (quotations and citation omitted).

The Court agrees with Plaintiffs that the purposes of NEPA were contravened when the Agencies failed to take the requisite "hard look" at certain impacts of fracking in WNF. The Court is also mindful of Plaintiffs' concern that keeping the leases in place on remand risks the Agency review becoming an exercise in futility with a predetermined outcome. However, the Court likewise acknowledges that this is not a situation in which the Agencies completely abandoned their duties under NEPA. Instead, the Court must consider the risksvacatur poses to Agency Defendants and Intervenors, especially when there is a strong possibility that a properly supported NEPA review could reach the same result as before.

Thus, despite the serious concerns the Court has with some of the Agencies' review, the Court finds there is "a serious possibility that the [agency] will be able to substantiate its decision on remand" such that this factor weighs against complete vacatur." See Standing Rock Sioux Tribe v. U.S. Army Corps of Eng'rs, 282 F. Supp. 3d 91, 98 (D.D.C. 2017); WildEarth Guardians v. Zinke, 368 F. Supp. 3d 41, 84 (D.D.C. 2019) (applying Allied-Signal and declining to vacate leases because "BLM's NEPA violation consists merely of a failure to fully discuss the environmental effects of those lease sales; nothing in the record indicates that on remand the agency will necessarily fail to justify its decisions to issue EAs or FONSIs.").

2. Disruptive consequences of vacatur

Intervenor Associations, Eclipse, and Agency Defendants likewise emphasize the economic impacts of vacatur and the practical difficulties of unwinding agency actions. Plaintiffs acknowledge that some disruption might occur but argue the purely economic consequences are insignificant and can be remedied with a refund. Pls.' Br. 15, ECF No. 111.

Intervenor Associations, Eclipse, and Agency Defendants first argue that the economic harms of vacatur would be disruptive and far reaching. Eclipse highlights the economic harms it might face, including loss of oil and gasexploration investments of approximately $41,400,000 in WNF and surrounding privately owned areas. Rucker Decl. ¶¶ 9,12, 18, 20, ECF No. 113-1. Eclipse avers that it has taken steps, including partially drilling two wells and commenced well-site...