Leslie Salt Co. v. U.S.

• Decision Date: 22 May 1995
• Docket Number: No. 93-15932,93-15932
• Parties: , 63 USLW 2746, 25 Envtl. L. Rep. 21,046 LESLIE SALT CO., a Delaware corporation; Cargill, Inc., Plaintiffs-Appellants, v. UNITED STATES of America, Defendant-Appellee.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1388

55 F.3d 1388

40 ERC 1865, 63 USLW 2746, 25 Envtl.

L. Rep. 21,046

LESLIE SALT CO., a Delaware corporation; Cargill, Inc., Plaintiffs-Appellants, v. UNITED STATES of America, Defendant-Appellee.

No. 93-15932.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted Nov. 14, 1994.

Decided May 22, 1995.

Edgar B. Washburn, Washburn, Briscoe & McCarthy, San Francisco, CA, for plaintiffs-appellants.

David C. Shilton, U.S. Dept. of Justice, Washington, DC, for defendant-appellee.

Appeal from the United States District Court for the Northern District of California.

Before LAY, ^* PREGERSON, and O'SCANNLAIN, Circuit Judges.

O'SCANNLAIN, Circuit Judge:

We must decide whether to revisit an issue previously resolved by this court--whether isolated, seasonally dry intrastate waters used only by migratory birds are within the regulatory reach of the Clean Water Act. We also decide whether, in the event of violations of the Act, civil fines are mandatory or discretionary.

I

Cargill, Inc., the corporate successor to Leslie Salt Co., owns a 153-acre tract of land southeast of San Francisco. The property abuts the San Francisco Bay National Wildlife Refuge and lies near Newark Slough, a tidal arm of San Francisco Bay. A road divides the property into a 143-acre parcel and a 10-acre parcel. Until 1959, Leslie Salt used the property for salt manufacturing. The eastern part of the 143-acre parcel still contains pits that were used to collect calcium chloride, and the western part contains shallow basins that were used for crystallizing salt.

This appeal centers on 12.5 acres out of the 143-acre parcel, on which the former crystallizers and calcium chloride pits still lie. During much of the year, these areas are dry. During the winter and spring, however, rainwater creates temporary ponds. Migratory birds use these ponds for habitat. The dispute in this case began in 1985, when Leslie Salt began digging a feeder ditch and a siltation pond on its property and began discharging fill that affected the seasonally ponded areas.

A

Under the Clean Water Act ("the Act"), the discharge of any "pollutant"--which includes dredged or fill materials--into "navigable waters" is forbidden unless authorized by a permit issued by the Army Corps of Engineers (the "Corps"). 33 U.S.C. Secs. 1311(a), 1344(a), 1362(12). "Navigable waters" is defined in the Act as "waters of the United States." 33 U.S.C. Sec. 1362(7). The Act provides no further guidance as to what these terms encompass. The Corps has promulgated regulations defining "waters of the United States" as:

(1) All waters which are currently used, or were used in the past, or may be susceptible to use in interstate or foreign commerce, including all waters which are subject to the ebb and flow of the tide;

* * * * * *

(3) All other waters such as intrastate lakes, rivers, streams (including intermittent streams), mudflats, sandflats, wetlands, sloughs, prairie potholes, wet meadows, playa lakes, or natural ponds, the use, degradation or destruction of which could affect interstate or foreign commerce including any such waters:

(i) Which are or could be used by interstate or foreign travelers for recreational or other purposes; or

(ii) From which fish or shellfish are or could be taken and sold in interstate or foreign commerce; or

(iii) Which are or could be used for industrial purposes by industries in interstate commerce.

33 C.F.R. Sec. 328.3(a) (emphasis added). See also 40 C.F.R. Sec. 230.3(s)(3) (EPA's identical definition).

In the preamble to the 1986 regulations, the Corps suggested that "waters of the United States" also includes waters:

a. Which are or would be used as habitat by birds protected by Migratory Bird Treaties; or

b. Which are or would be used as habitat by other migratory birds which cross state lines; or

c. Which are or would be used as habitat for endangered species; or

d. Used to irrigate crops sold in interstate commerce.

51 Fed.Reg. 41,217 (1986). This preamble material has never been subjected to notice-and-comment procedures and has not been promulgated as an official regulation. The predicate for jurisdiction over the seasonally ponded areas still in dispute in this case is their status as "other waters" which are used as habitat by migratory birds.

B

Upon learning that Leslie Salt was discharging fill that affected the seasonally ponded areas, the Corps issued a cease and desist order under section 404 of the Act. Leslie Salt filed suit challenging the Corps' jurisdiction over the property. The United States also brought an enforcement action, which was consolidated with Leslie Salt's suit.

The district court originally held that the Corps had no jurisdiction over Leslie Salt's property. Leslie Salt Co. v. United States, 700 F.Supp. 476 (N.D.Cal.1989) ("Leslie Salt I "). On the issue that is currently before this court, the district court held that the temporary ponds in the crystallizers and the pits were not "other waters" under 33 C.F.R. Sec. 328.3(a)(3), because they had been artificially created and were dry much of the year.

On appeal, this court reversed and remanded. Leslie Salt Co. v. United States, 896 F.2d 354 (9th Cir.1990), cert. denied, 498 U.S. 1126, 111 S.Ct. 1089, 112 L.Ed.2d 1194 (1991) ("Leslie Salt II "). The court held, among other things, that the fact that the crystallizers and pits were artificially made and dry part of the year did not exclude them from being "other waters." See id. at 359-60. The court also held that "[t]he commerce clause power, and thus the Clean Water Act, is broad enough to extend the Corps' jurisdiction to local waters which may provide habitat to migratory birds and endangered species." Id. at 360. The court thus reversed and remanded for a factual determination of which parts of Leslie Salt's property had sufficient connections to interstate commerce to be subject to the Corps' jurisdiction under the Act.

On remand, the district court found that roughly 12.5 acres of seasonally ponded areas, primarily in the calcium chloride pits, were subject to jurisdiction. Leslie Salt Co. v. United States, 820 F.Supp. 478 (N.D.Cal.1992) ("order for judgment") ("Leslie Salt III "). The court justified this holding by referring to the evidence summarized in the United States' Memorandum on Remand. See id. at 480. Among other things, this Memorandum states that some 55 species of migratory birds use the seasonally ponded areas as habitat. The court also held that Leslie Salt violated the Act in three of these areas by discharging fill or altering structures without a permit at specific points. Finally, in proceedings addressing the issue of remedies, the court ruled that penalties are mandatory under section 309(d) of the Act when a violation has been found, and that the United States was entitled to injunctive relief to restore the property to its preexisting condition. See id. at 483-84 ("order regarding remedies"). The parties subsequently stipulated to a penalty of $50,000 and a restoration plan. The stipulation preserved Cargill's right to appeal the issue of whether penalties are mandatory.

II

Cargill urges this court to revisit the Leslie Salt II court's determination that the Corps' jurisdiction under the Act reaches isolated waters used only by migratory birds. Under law of the case doctrine, however, one panel of an appellate court will not reconsider matters resolved in a prior appeal to another panel in the same case. Kimball v. Callahan, 590 F.2d 768, 771 (9th Cir.), cert. denied, 444 U.S. 826, 100 S.Ct. 49, 62 L.Ed.2d 33 (1979); 18 Charles Alan Wright, Arthur R. Miller & Edward H. Cooper, Federal Practice & Procedure Sec. 4478, at 788 (1982). In the subsequent appeal, "[t]he scope of review is narrowed to the limitations of the remand." Adamian v. Lombardi, 608 F.2d 1224, 1228 (9th Cir.1979), cert. denied, 446 U.S. 938, 100 S.Ct. 2158, 64 L.Ed.2d 791 (1980).

In Leslie Salt II, a panel of this court held that "[t]he commerce clause power, and thus the Clean Water Act, is broad enough to extend the Corps' jurisdiction to local waters which may provide habitat to migratory birds and endangered species." 896 F.2d at 360. The court remanded only for a "factual determination of the sufficiency of the property's connections to interstate commerce." Id. at 361. Thus, the validity of the "migratory bird rule" was established in the first appeal, and this court's review should generally be limited to the issues decided on remand--the property's specific connections to interstate commerce due to migratory bird use. However, Cargill does not appeal the district court's factual findings.

Instead, Cargill first claims that this court should not apply law of the case because the panel in Leslie Salt II upheld the migratory bird rule in "a bare conclusion" and "without any discussion." Admittedly, a more detailed explanation for such a significant holding might have been more illuminating. However, Cargill's argument fails for two reasons. First, the panel's holding, though succinct, was addressed in a separate section of the opinion, specifically referred to the migratory bird examples in the preamble to the 1986 regulations, and was supported by citations to relevant case law. Leslie Salt II, 896 F.2d at 360. Judge Rymer's dissent in Leslie Salt II challenged the majority on precisely this point, which shows that the panel was aware of the issue. See id. at 361-62 n. 1. Second, "even summarily treated issues become the law of the case." Alliance for Cannabis Therapeutics v. DEA, 15 F.3d 1131, 1135 (D.C.Cir.1994). This court has followed law of the case even where the first panel's holding was "cryptic and somewhat ambiguous." Hanna Boys Ctr. v. Miller, 853 F.2d 682, 687 (9th Cir.1988). See also Christianson v. Colt Indus. Operating Corp., 486 U.S. 800, 817, 108 S.Ct. 2166, 2178, 100 L.Ed.2d 811 (1988) ("[T]he law of the case turns on whether a court previously decide[d]...