Swanson Grp. Mfg. LLC v. Bernhardt

417 F.Supp.3d 22

SWANSON GROUP MFG. LLC, et al., Plaintiffs,

v.David L. BERNHARDT, Secretary of the Interior, Defendant.

Civil Case No. 15-1419 (RJL)

United States District Court, District of Columbia.

September 29, 2019

Filed September 30, 2019

Lawson Emmett Fite, American Forest Resource Council, Portland, OR, Mark C. Rutzick, Mark C. Rutzick, Inc., Oak Hill, VA, for Plaintiffs.

Shaun M. Pettigrew, Shawn Derek Shugert, Andrea Gelatt, U.S. Department of Justice, Washington, DC, for Defendant.

MEMORANDUM OPINION

[Dkt. ## 54, 57]

RICHARD J. LEON, United States District Judge

In the Oregon and California Railroad and Coos Bay Wagon Road Grant Lands Act of 1937, 43 U.S.C. §§ 2601 – 05 ("the O & C Act"), Congress mandated that the Department of the Interior must sell or offer for sale, every year, timber from land subject to the Act in an amount "not less than the annual sustained yield capacity [of the land] when the same has been determined and declared." Id. § 2601. Plaintiffs Starfire Lumber Company and South Coast Lumber Company¹ (collectively, "plaintiffs") allege that the Bureau of Land Management ("BLM"), the agency within the Department of the Interior responsible for administering O & C land, routinely violates this timber sale mandate. They sued the Secretary of the Interior² ("defendant"), seeking to compel his compliance with the O & C Act, and have now moved for summary judgment. Defendant cross-moved for judgment in its favor. Because I conclude that BLM has violated the O & C Act, and for all of the reasons that follow, plaintiffs' motion will be GRANTED IN PART, and defendant's cross-motion will be DENIED.

BACKGROUND

"The O & C Act governs BLM's management of approximately two million acres of land in western Oregon...." Am. Forest Res. Council v. Steed , No. 16-1599, 2019 WL 1440887, at *2 (D.D.C. Mar. 31, 2019). Timberland subject to the Act must "be managed ... for permanent forest production." 43 U.S.C. § 2601. And every year, timber that is grown on O & C land must be sold or offered for sale. In the O & C Act, Congress provides that "timber ... in an amount not less than one-half billion feet board measure, or not less than the annual sustained yield capacity when the same has been determined and declared, shall be sold annually, or so much thereof as can be sold at reasonable prices on a normal market." Id.

BLM is the federal agency responsible both for "determin[ing] and declar[ing]" the O & C land's "annual sustained yield capacity," 43 U.S.C. § 2601, and for administering the required timber sales. See U.S. Dep't of the Interior, BLM, O & C Sustained Yield Act: the Land, the Law, the Legacy (1937-1987) at 13–15, 17, available at https://www.blm.gov/or/files/OC_History.pdf. In 1995, BLM issued resource management plans ("the 1995 RMPs") that divided O & C land into five districts and one resource planning area. See Administrative Record ("AR") at AR_20459; AR_20528–529; AR_20582; AR_20687; AR_20758; AR_20947; AR_21041; AR_21232; AR_21250; AR_21585; AR_21663; AR_21842; AR_21900 [Dkt. # 64]. The 1995 RMPs then declared a base allowable sale quantity ("ASQ") for each district or area. See AR_20528; AR_20758; AR_21041; AR_21250; AR_21663; AR_21900. Defendant represents that BLM uses the term "ASQ" synonymously with "annual sustained yield capacity," the phrase that appears in the O & C Act's timber sale mandate. See Fed. Def.'s Cross-Mot. Summ. J. at 4 [Dkt. # 57]. But BLM also cautions that the ASQs declared in the 1995 RMPs are merely "estimate[s] of annual average timber sale volume likely to be achieved from lands allocated to planned, sustainable harvest." AR_20528. The 1995 RMPs provide that "[t]he actual sustainable timber sale level ... may deviate by as much as 20 percent from the identified [ASQ]." AR_20529.

The 1995 RMPs remained in effect through 2015, when this suit was filed. The next year, however, BLM adopted new resource management plans ("the 2016 RMPs") with adjusted base ASQs. See Northwestern & Coastal Oregon Record of Decision ("NCO ROD") at 6 [Dkt. # 57-5]; Southwestern Oregon Record of Decision ("SWO ROD") at 5 [Dkt. # 57-6]. The new RMPs increased the extent to which BLM could deviate from the base ASQs in a given year, permitting "as much as 40 percent variation on an annual basis." NCO ROD at 6; see also SWO ROD at 6. But they required BLM to maintain harvest levels within 20% or 30% of the ASQs—depending on the district—over the course of a decade. See NCO ROD at 6; SWO ROD at 6.

Plaintiffs purchase timber grown on land subject to the O & C Act and use the timber to produce forest products. BLM's annual sustained yield capacity declarations, therefore, affect the timber supply available to plaintiffs, and BLM's failure to offer for sale a volume of timber commensurate with those declarations harms plaintiffs' businesses. As a factual matter, there is little dispute that such failures have occurred. BLM has "acknowledged a shortfall in timber volume offered" for sale as a "result of unforeseen circumstances and shortcomings in the 1995 RMPs." Decl. of Richard Hardt in Supp. of Fed. Def.'s Cross-Mot. Summ. J. ("Hardt Decl.") ¶ 2 [Dkt. # 57-7]. In Counts One and Four of the operative complaint,³ plaintiffs allege that BLM violates the O & C Act and the Administrative Procedure Act, 5 U.S.C. § 706 ("the APA"), every year that annual timber offerings are less than the declared annual sustained yield capacity. See Corrected Compl. ¶¶ 97–101, 117–119.

This is not the first time plaintiffs have sued to challenge a shortfall in O & C timber sales. By their "own admission, this action seeks to restate plaintiffs' claims from Swanson Group Mfg. LLC v. Jewell , No. 10cv1843 (filed on Oct. 29, 2010) (‘Swanson I ’) and related claims from Swanson Group Mfg. LLC v. Director , No. 14-211, 2015 WL 5693429 (D.D.C. 2015) (‘ Swanson II ’) with new evidence regarding standing." Swanson IV , 195 F. Supp. 3d at 71.

Nor is this the first time I have been confronted with a motion for summary judgment on these claims. "In Swanson I , I granted summary judgment in favor of the plaintiffs," after determining that BLM's "failure to offer for sale a declared amount of timber from two western Oregon districts" was unlawful. Swanson IV , 195 F. Supp. 3d at 71. In Swanson II , plaintiffs sought to extend the holding from Swanson I to timber sales in additional O & C districts. See id. But before Swanson II could be resolved on the merits, our Circuit Court dismissed the Swanson I complaint, reasoning that plaintiffs lacked Article III standing. See Swanson Group Mfg. LLC v. Jewell , 790 F.3d 235, 239–40 (D.C. Cir. 2015) (" Swanson III ") In accordance with the Circuit Court's decision, I then dismissed Swanson II on the same grounds. See Swanson II , 2015 WL 5693429, at *4. In response, plaintiffs reasserted their claims in this suit with their "new evidence regarding standing." Swanson IV , 195 F. Supp. 3d at 71.

Plaintiffs have now moved for summary judgment on the reasserted claims. Defendant responded with a cross-motion for summary judgment in its favor. Both motions are ripe for resolution.

STANDARD OF REVIEW

Summary judgment is appropriate when no genuine dispute exists as to any material fact and the moving party is entitled to judgment as a matter of law. See Fed. R. Civ. P. 56(a). In the context of agency review, "[s]ummary judgment ... serves as the mechanism for deciding, as a matter of law, whether the agency action is supported by the administrative record and otherwise consistent with the APA standard of review." Sierra Club v. Mainella , 459 F. Supp. 2d 76, 90 (D.D.C. 2006). Agency actions do not satisfy the APA standard of review when they are "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law." 5 U.S.C. § 706(2)(A).

ANALYSIS

In Swanson Group Mfg. LLC v. Salazar (Swanson I) , I determined that the timber sale mandate in the O & C Act "conveys a clear requirement: once BLM declares an annual sustained yield capacity, it must sell that amount [of timber] or so much thereof as can be sold at reasonable prices on a normal market" every year. 951 F. Supp. 2d 75, 81–82 (D.D.C. 2013). My determination followed directly from the statutory language. "Under the O & C Act, ‘[t]he annual productive capacity for [O & C] lands shall be determined and declared ... [and] timber from said lands in an amount not less than one-half billion feet board measure, or not less than the annual sustained yield capacity when the same has been determined and declared, shall be sold annually, or so much thereof as can be sold at reasonable prices on a normal market.’ " Id. (quoting 43 U.S.C. § 1181a, now codified at 43 U.S.C. § 2601 (second alteration added; emphasis in Swanson I )). These are mandatory directives: Congress decreed that the Department of the Interior "shall" declare a sustained yield capacity and "shall" sell or offer for sale annually an amount of timber that is not less than that declared capacity. 43 U.S.C. § 2601 ; see Swanson I , 951 F. Supp. 2d at 81 (citing Allied Pilots Ass'n v. Pension Benefit Guar. Corp. , 334 F.3d 93, 98 (D.C. Cir. 2003) for "the well-recognized principle that the word ‘shall’ is ordinarily the language of command"). "[S]hall," I explained in Swanson I , "means shall." 951 F. Supp. 2d at 82 (quotation marks omitted).

Defendant disputes this. It argues that the timber sale mandate in the O & C Act imposes no non-discretionary duty on BLM. But this reading of the Act is contrary to the straightforward interpretation of the statutory language in Swanson I , and nothing has changed since Swanson I issued that affects the analysis. The relevant text of the O & C Act, including its mandatory language, remains the same. See 43 U.S.C. § 2601. That text still "conveys a clear requirement." Swanson I , 951 F. Supp. 2d at 81. And shall still means shall. Swanson I was vacated on standing grounds, but the Circuit Court said nothing in its opinion...