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Western Energy Alliance v. Zinke

United States Court of Appeals, Tenth Circuit

December 18, 2017

WESTERN ENERGY ALLIANCE, Plaintiff - Appellee,

         Appeal from the United States District Court for the District of New Mexico (D.C. No. 1:16-CV-00912-WJ-KBM)

          Michael S. Freeman, Earthjustice, Denver, Colorado (Robin Cooley and Yuting Chi, Earthjustice, Denver, Colorado; Kyle J. Tisdel, Western Environmental Law Center, Taos, New Mexico; Samantha Ruscavage-Barz, WildEarth Guardians, Santa Fe, New Mexico; and Michael Saul, Center for Biological Diversity, Denver, Colorado, with him on the briefs), appearing for Movants to Intervene-Appellants.

          Mark S. Barron (Alexander K. Obrecht, with him on the briefs), Baker & Hostetler, Denver, Colorado, appearing for Appellee.

          Jeffrey H. Wood, Acting Assistant Attorney General; Andrew C. Mergen, John S. Most, and Matthrew Littleton, Attorneys, Environmental and Natural Resources Division, United States Department of Justice, Washington, DC; Karen S. Hawbecker, Danielle DiMauro, and Wendy S. Dorman, Office of the Solicitor, United States Department of the Interior, Washington, DC, filed a brief for Amicus Curiae United States.

          Before BRISCOE, HARTZ, and BACHARACH, Circuit Judges.

          BRISCOE, Circuit Judge.

         Plaintiff-Appellee Western Energy Alliance ("WEA") filed this lawsuit in the United States District Court for the District of New Mexico against two Defendants: the Secretary of the United States Department of the Interior, and the Bureau of Land Management (the "BLM"). WEA sought relief under the Administrative Procedure Act, 5 U.S.C. §§ 701-06 (the "APA"), the Freedom of Information Act, 5 U.S.C. § 552 ("FOIA"), and the Declaratory Judgment Act, 28 U.S.C. §§ 2201-02 (the "DJA"). WEA alleged that the BLM has violated the Mineral Leasing Act, 30 U.S.C. §§ 181-287 (the "MLA"), by holding too few oil and gas lease sales. Several environmental advocacy groups moved to intervene in the suit: The Wilderness Society, Wyoming Outdoor Council, Southern Utah Wilderness Society, San Juan Citizens Alliance, Great Old Broads For Wilderness, Sierra Club, WildEarth Guardians, Center For Biological Diversity, and Earthworks (collectively, the "conservation groups"). The district court denied the motion to intervene. The court concluded that the conservation groups had failed to show that the pending litigation has the potential to harm their environmental interests, or that the presently named parties could not adequately represent their interests. The conservation groups filed this interlocutory appeal to seek review of the denial of their motion to intervene. We exercise jurisdiction pursuant to 28 U.S.C. § 1291 and reverse and remand.


         Oil and Gas Leasing on Public Lands

         The BLM has the authority to lease public lands with oil and gas reserves to private industry for development under the Federal Land Policy and Management Act, 43 U.S.C. §§ 1701-1787 (the "FLPMA"), the MLA, and the BLM's own regulations and plans. See 43 C.F.R. Part 1600 (Planning, Programming, and Budgeting); 43 C.F.R. Subparts 3120 (Competitive Leases) and 3160 (Onshore Oil and Gas Operations). Both the MLA and the associated regulations provide for quarterly lease sales. 30 U.S.C. § 226(b)(1)(A) ("Lease sales shall be held for each State where eligible lands are available at least quarterly and more frequently if the Secretary of the Interior determines such sales are necessary."); see also 43 C.F.R. 3120.1-2(a) ("Each proper BLM S[t]ate office shall hold sales at least quarterly if lands are available for competitive leasing.").

         The BLM "manages the use of federal oil and gas resources through a three-phase decision-making process." Pennaco Energy, Inc. v. United States Dep't of Interior, 377 F.3d 1147, 1151 (10th Cir. 2004). In the first phase, the BLM develops resource management plans ("RMPs"). 43 U.S.C. § 1712; 43 C.F.R. Part 1600. RMPs indicate which parcels of public land are open or closed to oil and gas development. When drafting RMPs, the BLM is required by statute to apply multiple use management, which "describes the . . . task of striking a balance among the many competing uses to which land can be put, 'including, but not limited to, recreation, range, timber, minerals, watershed, wildlife and fish, and [uses serving] natural scenic, scientific and historical values.'" Norton v. S. Utah Wilderness All., 542 U.S. 55, 58 (quoting 43 U.S.C. § 1702(c)). Additionally, the BLM "prepare[s] an environmental impact statement" in compliance with the National Environmental Protection Act (the "NEPA") when preparing an RMP. 43 C.F.R. § 1601.0-6. Generally, an RMP "describes, for a particular area, allowable uses, goals for future condition of the land, and specific next steps." Norton, 542 U.S. at 59. The applicable regulations also require that the public must have a chance "to become meaningfully involved in and comment on the preparation and amendment of" RMPs. 43 C.F.R. § 1610.2(a). All subsequent activity on the land, including oil and gas development, must conform to RMPs. See 43 C.F.R. § 1610.6-3(a).

         In the second phase, through its State Offices, [1] the BLM identifies specific parcels that it will offer for lease in the competitive lease sale process. 43 C.F.R. Subpart 3120. The BLM retains discretion to choose which parcels to lease. W. Energy All. v. Salazar, 709 F.3d 1040, 1044 (10th Cir. 2013). "'Eligible' lands comprise all lands 'subject to leasing, i.e, lands not excluded from leasing by a statutory or regulatory prohibition.' 'Available' lands are those 'open to leasing in the applicable [RMP], . . . when all statutory requirements and reviews have been met.'" Amicus Br. at 6 n.2 (quoting BLM Manual 3120.11).

         Also in the second phase, after a State Office decides which parcels to offer in a lease sale, the State Office posts a final sale notice listing those parcels at least 45 days before the sale date, and often 90 days before. 43 C.F.R. § 3120.4-2; App. at 187 (BLM Manual 3120 (updated February 18, 2013)). Once the notice is posted, the BLM's practice is to provide a 30-day protest period. App. at 187 (BLM Manual 3120 (updated February 18, 2013)). While a protest is pending, the BLM can suspend a specific parcel from the offering. 43 C.F.R. § 3120.1-3. Although "[s]tate offices should attempt to resolve protests before the sale of the protested parcels, " protests unresolved by the lease auction date do not prevent bidding on the contested parcel. App. at 187 (BLM Manual 3120 (updated February 18, 2013)). If an RMP identifies land as open to development, a State Office can publish in the Federal Register a call for expressions of leasing interest, which anyone may file. See App. at 134. The regulations provide that "[l]ands included in any expression of interest" are "available for leasing" and "shall be offered for competitive bidding." 43 C.F.R. § 3120.1-1(e). The State Office then conducts a competitive lease sale auction. See 30 U.S.C. § 226(b)(1)(A).

         In 2010, the Interior Department updated its second-phase practices (the BLM's identification of specific parcels to be offered for lease) by adopting Instruction Memorandum 2010-117 (the "Leasing Reform Policy"), following years of negotiation and litigation by the conservation groups. Aplt. Br. at 7, 20-21. The Leasing Reform Policy provides for additional review simultaneous with the NEPA analysis. App. at 136. Specifically, the Leasing Reform Policy: (i) requires an interdisciplinary team to review the parcels proposed for leasing and conduct a site visit, id. at 136-38; (ii) identifies issues the BLM must consider, id. at 136-37; and (iii) obliges the BLM to consult other stakeholders, such as federal agencies, and State, tribal, and local governments. Id. at 137. While each State Office must still hold at least four total lease sales per year where eligible lands are available, the Leasing Reform Policy mandates that State Offices schedule lease sales on a rotating basis. Id. at 136. The relevant section of the Policy states:

State offices will continue to hold lease sales four times per year, as required by the Mineral Leasing Act, section 226(b)(1)(A), and 43 CFR 3120.1-2(a), when eligible lands are determined by the state office to be available for leasing. However, state offices will develop a sales schedule with an emphasis on rotating lease parcel review responsibilities among field offices throughout the year to balance the workload and to allow each field office to devote sufficient time and resources to implementing the parcel review policy established in this IM. State offices will extend field office review timeframes, as necessary, to ensure there is adequate time for the field offices to conduct comprehensive parcel reviews.

Id. The BLM has adopted parts of the Leasing Reform Policy into its Manual and Handbook, "which are permanent agency guidance documents." Amicus Br. at 3.

         Finally, after selling a lease, and as part of the third phase of the BLM's decision-making process, the BLM also decides whether specific development projects will be permitted on the leased land. The BLM's authority in this regard originates with the MLA, which gives the BLM the power to "regulate all surface-disturbing activities conducted pursuant to any lease issued under" the MLA and to set reclamation and other requirements necessary to conserve any surface resources. § 226(g); see generally 43 C.F.R. § 3162.3-1 (providing for drilling applications and plans).

         Case History

         On August 11, 2016, the WEA filed a complaint under the APA. Count I alleges a FOIA violation. This claim, which is not mentioned in the motion to intervene, is not relevant to this appeal. Count II seeks a declaratory judgment, under the DJA, "that BLM's leasing policies and practices violate the" MLA by causing fewer than four lease sales per State[2] per year to take place. App. at 39- 40. Count III alleges that the BLM's actions have resulted in fewer than the statutorily mandated four lease sales per year and thus are contrary to law; specifically, contrary to the MLA, and in violation of the APA. The Prayer for Relief, in relevant part, asks the district court to:

2. Declare the manner in which [the] BLM is presently scheduling and administering oil and gas lease sales unlawful as a violation of the express terms of the Mineral Leasing Act;
3. Require [the] BLM to immediately abandon all currently existing lease sale schedules that do not comply with the Mineral Leasing Act and to adopt promptly revised lease sale schedules that comply with the terms of the Mineral Leasing Act;
4. Direct [the] BLM to revise or rescind all agency guidance and instructional memoranda, including I.M. No. 2010-117, that direct implementation of [the] BLM's lease ...

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