Biological Diversity v. U.S. Fish, Wildlife

• Decision Date: 05 June 2006
• Docket Number: No. 04-55084.,04-55084.
• Citation: 450 F.3d 930
• Parties: CENTER FOR BIOLOGICAL DIVERSITY; Friends of the Santa Clara River, Plaintiffs-Appellants, v. UNITED STATES FISH & WILDLIFE SERVICE, Defendant-Appellee, Cemex Inc., a Louisiana Corporation qualified to do business in California f/k/a Southdown Inc. d/b/a Transit Mixed Concrete (TMC), Defendant-Intervenor-Appellee.
• Court: U.S. Court of Appeals — Ninth Circuit

450 F.3d 930

CENTER FOR BIOLOGICAL DIVERSITY; Friends of the Santa Clara River, Plaintiffs-Appellants, v. UNITED STATES FISH & WILDLIFE SERVICE, Defendant-Appellee Cemex Inc., a Louisiana Corporation qualified to do business in California f/k/a Southdown Inc. d/b/a Transit Mixed Concrete (TMC), Defendant-Intervenor-Appellee.

No. 04-55084.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted October 19, 2005.

Filed June 5, 2006.

COPYRIGHT MATERIAL OMITTED

John Buse, Environmental Defense Center, Ventura, CA, argued the cause for the petitioners; Brent Plater, Center for Biological Diversity, Oakland, CA, and Karen M. Kraus, Environmental Defense Center, Santa Barbara, CA, were on the briefs.

Andrew Mergen, United States Department of Justice, Washington, D.C., argued the cause for respondent United States Fish & Wildlife Service; Assistant Attorney General Thomas L. Sansonetti, James C. Kilbourne, and Paul S. Weiland, United States Department of Justice, Washington, D.C., were on the brief.

Michael Hassen, Jeffer, Mangels, Butler & Marmaro, LLP, San Francisco, CA, argued the cause for respondent Cemex, Inc.; Kerry Shapiro and Scott N. Castro, Jeffer, Mangels, Butler & Marmaro, LLP, San Francisco, CA, were on the brief.

Robert J. Uram, Ella Foley-Gannon, and Aaron J. Foxworthy, Sheppard, Mullin, Richter & Hampton LLP, San Francisco, CA, filed a brief for amicus curiae Building Industry Legal Defense Foundation and California Building Industry Association.

Appeal from the United States District Court for the Central District of California; Robert M. Takasugi, District Judge, Presiding. D.C. No. CV-02-00412-RMT.

Before HALL, O'SCANNLAIN, and PAEZ, Circuit Judges.

O'SCANNLAIN, Circuit Judge.

We must decide whether the Endangered Species Act requires the United States Fish and Wildlife Service to complete formal designation of critical habitat for an endangered fish species listed over thirty-five years ago.

I

A

The United States Fish and Wildlife Service ("Service") listed the unarmored threespine stickleback ("stickleback"), a small, scaleless freshwater fish, as an endangered species in 1970 under the Endangered Species Act ("ESA"), 16 U.S.C. §§ 1531-1599. The stickleback is found chiefly in parts of Santa Barbara, Los Angeles, and San Diego counties in southern California. The stickleback prefers to make its nest where there is ample vegetation and a gentle flow of water, avoiding areas with either too much or no water flow. In fact, the rate of water flow is a key factor in preferred stickleback habitat.

In 1980, the Service proposed a rule designating three stream zones of the Santa Clara River watershed as critical habitat for the stickleback but never completed the designation.

In 1990, the Bureau of Land Management ("BLM") awarded CEMEX, Inc.,¹ a contract to mine fifty-six million tons of sand and gravel from a location in Los Angeles County's Soledad Canyon. Although the mining would not take place within the stickleback's habitat, the project involves pumping water from the Santa Clara River and could cause portions of the river to run dry periodically. Parts of the Santa Clara River commonly dry out during the summer season, trapping stickleback in isolated pools, which eventually dry completely. Uncontrolled pumping during particularly dry periods could exacerbate the problem, significantly impacting the stickleback. Because of the project's potential impact, the BLM initiated formal consultation with the Service under the ESA, submitting its final biological assessment for the project in June 1996.

The Service reviewed the project's likely impact on the stickleback and CEMEX's proposals to mitigate those impacts. Ultimately, the Service issued its January 1998 biological opinion, which concluded that the project was "not likely to jeopardize the continued existence of the stickleback." The biological opinion included an incidental take statement ("ITS") "which if followed, [would] exempt[] the [Service and CEMEX] from the prohibition on takings² found in Section 9 of the ESA." Nat'l Wildlife Fed'n v. Nat'l Marine Fisheries Serv., 422 F.3d 782, 790 (9th Cir.2005) (citing 16 U.S.C. § 1536(b)(4) and Aluminum Co. of America v. Adm'r, Bonneville Power Admin., 175 F.3d 1156, 1159(9th Cir.1999)). The Service was unable to predict how many stickleback might be taken by the project, particularly in light of the difficulty in isolating the cause of any particular stickleback's death.

The Service's biological opinion requires CEMEX to take specific "reasonable and prudent measures" in order to minimize incidental take of stickleback. The measures include continuous monitoring of water levels in the Santa Clara River and the cessation of pumping from the river "if the habitat requirements of the . . . stickleback are not being met." The BLM's formal consultation process with the Service ended with the issuance of the biological opinion.³

B

The Center for Biological Diversity ("CBD"), an organization dedicated to the protection and restoration of natural ecosystems and imperiled species, filed suit in 2002, claiming that the Service violated the ESA by failing to complete the designation of critical habitat for the stickleback. CBD subsequently amended its complaint to claim that the Service violated the ESA and its own regulations by issuing the ITS to CEMEX. Following such amendment, the district court granted CEMEX's motion to intervene as a defendant based on its interest in the mining project.

On September 11, 2002, the Service published its finding that critical habitat should not be designated for the stickleback. Designation of Critical Habitat for the Unarmored Threespine Stickleback, 67 Fed.Reg. 58,580, 58,581 (Sept. 17, 2002) ("Critical Habitat Finding" or "Finding"). Coincidentally, CBD moved for summary judgment on the same day. After the Service also moved for summary judgment, CBD amended its complaint a second time, challenging the Finding as arbitrary and capricious.

Following cross-motions for summary judgment in December 2002 and January 2003, the district court granted summary judgment to the Service and CEMEX. The court declared CBD's original claim moot. The court rejected CBD's other claims, concluding that the decision not to designate critical habitat was within the Service's discretion and that the Service did not violate the ESA by issuing an ITS to CEMEX. The district court also granted motions to strike several CBD exhibits that were not part of the administrative record.

CBD timely appealed.⁴

II

CBD challenges the Service's Finding on three grounds. First, CBD argues that the Service exceeded its statutory authority because the ESA requires designations of critical habitat to be made "to the maximum extent prudent and determinable." Second, CBD claims that the Finding was arbitrary and capricious because the Service did not articulate a rational connection between the facts and its decision. Third, CBD insists that the Finding is invalid because the Service did not provide a notice and comment period. We consider each argument in turn.

A

To begin, CBD claims—based on its interpretation of the ESA—that the Service has a mandatory duty to complete the proposed designation of critical habitat for the stickleback.

The ESA subsection governing designations of critical habitat states:

The [Service],⁵ by regulation promulgated in accordance with subsection (b) of this section and to the maximum extent prudent and determinable—

(A) shall, concurrently with making a determination under paragraph (1) that a species is an endangered species or a threatened species, designate any habitat of such species which is then considered to be critical habitat; and

(B) may, from time-to-time thereafter as appropriate, revise such designation.

16 U.S.C. § 1533(a)(3)(A). Under this provision, designations of critical habitat must be made at the time a species is listed as endangered, but this requirement was added to the ESA in 1982. Indeed, the 1982 amendments to the ESA specified that

[a]ny regulation proposed after, or pending on, the date of the enactment of this Act to designate critical habitat for a species that was determined before such date of enactment to be endangered or threatened shall be subject to the procedures. . . for regulations proposing revisions to critical habitat instead of those for regulations proposing the designation of critical habitat.

ESA Amendments of 1982, Pub.L. No. 97-304, § 2(b)(2), 96 Stat. 1411 (1982) (emphasis added).

Pursuant to the 1982 Amendments, critical habitat designations for the stickleback—listed as an endangered species in 1970⁶—are governed by the procedures for critical habitat revisions. While the Service "shall" designate critical habitat, it "may" revise critical habitat designations "from time-to-time . . . as appropriate." 16 U.S.C. § 1533(a)(3)(A). When "may" and "shall" are both used in a statute, "the normal inference is that each is being used in its ordinary sense—the one being permissive, the other mandatory." Haynes v. United States, 891 F.2d 235, 239-40 (9th Cir.1989). It follows that critical habitat designations are mandatory, but revisions are discretionary.

CBD concedes as much but argues that once a proposal is made the Service has a mandatory duty to complete the designation "to the maximum extent prudent and determinable." Put another way, CBD contends that once the Service proposes a designation of critical habitat, that designation must be completed unless not prudent or determinable. The Service published a proposed rule for designation of critical habitat for the stickleback in 1980. Proposed Designation of Critical Habitat for the Endangered Unarmored Threespine Stickleback ("Proposed Critical Habitat Designation"), 45 Fed.Reg. 76,012 (Nov. 17, 1980). Under CBD's theory, the Service has a mandatory duty to complete this proposed designation.⁷ We are not persuaded.

The 1982 Amend...