Anglers of the Au Sable v. U.S. Forest Service

• Decision Date: 10 July 2008
• Docket Number: Case No. 05-10152.
• Citation: 565 F.Supp.2d 812
• Parties: ANGLERS OF THE AU SABLE, Tim Mason, and Sierra Club (Mackinac Chapter), Plaintiffs, v. UNITED STATES FOREST SERVICE, and United States Bureau of Land Management, Defendants.
• Court: U.S. District Court — Eastern District of Michigan

565 F.Supp.2d 812

ANGLERS OF THE AU SABLE, Tim Mason, and Sierra Club (Mackinac Chapter), Plaintiffs, v. UNITED STATES FOREST SERVICE, and United States Bureau of Land Management, Defendants.

Case No. 05-10152.

United States District Court, E.D. Michigan, Southern Division.

July 10, 2008.

COPYRIGHT MATERIAL OMITTED

Aaron Isherwood, Sierra Club, San Francisco, CA, Bruce M. Pregler, Facca, Richter, Troy, MI, Marianne G. Dugan, Eugene, OR, Mark R. Daane, Hooper, Hathaway, Ann Arbor, MI, for Plaintiffs.

Gregory Daniel Page, U.S. Department of Justice, Washington, DO, Janet L. Parker, U.S. Attorney's Office, Bay City, MI, for Defendants.

OPINION AND ORDER ADOPTING IN PART AND REJECTING IN PART MAGISTRATE JUDGE'S REPORT AND RECOMMENDATION, SUSTAINING IN PART AND OVERRULING IN PART DEFENDANTS' OBJECTIONS, GRANTING IN PART AND DENYING IN PART PLAINTIFFS' MOTION FOR SUMMARY JUDGMENT, GRANTING IN PART AND DENYING IN PART DEFENDANTS' MOTION FOR SUMMARY JUDGMENT, AND GRANTING PLAINTIFFS' MOTION FOR CLARIFICATION

DAVID M. LAWSON, District Judge.

This matter is before the Court on the defendants' objections to a report filed by Magistrate Judge Charles E. Binder recommending that the plaintiffs' motion for summary judgment be granted and the defendants' cross motion for summary judgment be denied. The plaintiffs also have filed a motion seeking clarification of the magistrate judge's report, which is addressed herein as well. The case was initiated by two environmental groups and one private citizen who contend that the United States Forest Service (Forest Service) and the United States Bureau of Land Management (BLM) violated their obligations under three federal acts in approving exploratory gas and oil drilling on a parcel of land within the Huron-Manistee National Forest. The plaintiffs ask this Court to review the agencies' decisions under the Administrative Procedures Act, and they seek declaratory and injunctive relief. In their eight-count amended complaint, the plaintiffs allege that the defendants violated the National Environmental Policy Act (NEPA), 42 U.S.C. § 4321 et seq., the National Forest Management Act, 16 U.S.C. § 1600 et seq., the Mineral Leasing Act, 30 U.S.C. § 181 et seq., and the Administrative Procedure Act, 5 U.S.C. § 555 et seq., by conducting a faulty environmental assessment (EA), improperly issuing a "Finding of No Significant Impact" (FONSI), and failing to prepare and issue an environmental impact statement concerning the project.

The Court referred the matter to Magistrate Judge Charles E. Binder for general case management, although the reference was temporarily withdrawn to adjudicate a motion for preliminary injunction. The magistrate judge issued his report on the parties' cross motions for summary judgment on June 20, 2006, and the defendants filed timely objections, to which the plaintiffs responded and the defendants replied.

The Court has reviewed the file, the report and recommendation, the defendants' objections, the responses, and replies, and has made a de novo review of the record in light of the parties' submissions. The Court agrees with the magistrate judge's conclusion that the defendants failed to comply with all of the procedural requirements of the National Environmental Policy Act, the environmental assessment is defective, and the finding of no significant impact is unsound. However, the magistrate judge did not address the plaintiffs' claims under the National Forest Management Act or the Mineral Leasing Act, and as to those claims (which are the subject of the plaintiffs' motion for clarification) the defendants are entitled to summary judgment.

I. Summary of decision

For reasons explained in, detail below, the Court concludes as follows: First, The Forest Service acted arbitrarily and capriciously in finding that the leaseholder's (Savoy Energy, L.P.) proposed drilling project would have no significant environmental impact. NEPA requires that federal agencies prepare an environmental impact statement (EIS) for all major federal actions that "significantly" affect the environment. Significance is measured by the context and intensity of impact. The Council on Environmental Quality's (CEQ) regulations outline ten factors that federal agencies must evaluate when assessing the intensity of an action's environmental impact. The defendants overlooked or insufficiently addressed at least four of the of CEQ intensity factors in issuing a FONSI. First, the Forest Service failed to study the possible impact of the project on the unique recreational characteristics of the Mason Tract, and the concomitant effect that a degradation of the recreational experience could have on tourism at the local, county, and state levels. Second, several effects of Savoy's proposed project are highly uncertain, and the Forest Service has failed to explain why better data was not gathered. Third, the Forest Service did not address the impact the present action may have as a precedent for future decisions. Finally, the biological assessment is woefully inadequate in evaluating the possible impact of the drilling project on the Kirtland's warbler, an endangered species. Cumulatively, these oversights raise substantial questions about the significance of the proposed project, and the contrary evidence suggests a significant environmental impact.

Second, the Forest Service did not consider an appropriate range of alternatives to Savoy's proposed drilling project as required by NEPA and CEQ regulations. NEPA requires agencies to consider any appropriate alternatives to a project that might alter the cost-benefit balance. Agencies may not define their own objectives in such narrow terms as to prevent the meaningful consideration of alternatives. Here, the Forest Service failed twice: first, the Forest Service did not take the requisite "hard look" at the "No Action" alternative because it felt constrained (unduly) by law and by the terms of Savoy's mineral lease; second, the Forest Service did not consider alternative locations for the well's bottom hole, impermissibly deferring to Savoy's project objectives despite the fact that an analysis of those alternative locations is more consistent with the Forest Service's stated goals. The Forest Service's failure to consider important aspects of the problem before approving drilling constitutes arbitrary and capricious agency action in violation of the Administrative Procedures Act.

Third, the Court finds that the defendants are entitled to summary judgment on the plaintiffs' claim under the National Forest Management Act alleging a violation of the Huron-Manistee National Forest Land and Resource Management Plan (LRMP) because the plaintiffs have failed to show that the Forest Service contradicted the terms of the LRMP. Although the LRMP establishes that disturbance to old growth forest shall be avoided where feasible and encourages the maintenance of a natural environment and the elimination of unnecessary roads, it balances these interests against the desire to promote mineral exploration. The drilling project in this case does not contradict the LRMP's terms, and it appears to mesh with the spirit of the plan. Based on these circumstances and the fact that the Forest Service's interpretation of the plan is entitled to considerable deference, the plaintiffs' have failed to show arbitrary or capricious agency action.

Fourth, the defendants are entitled to summary judgment on the plaintiffs' claim under the Mineral Leasing Act because the plaintiffs have cited no legal authority for this claim. The plaintiffs allege that the defendants violated the MLA by contravening 43 C.F.R. § 3161.2. However, this regulation is phrased in very general, perhaps aspirational, terms. The plaintiffs seem to believe that section 3161.2 is violated every time NEPA is violated, but there is no authority for this novel proposition.

Therefore, the Court will grant in part and deny in part each party's motion for summary judgment, declare the EA and the FONSI inadequate, and enjoin the defendants from proceeding to authorize the proposed gas drilling project based on the FONSI.

II. Facts and proceedings

The Court takes the facts from the administrative record, although the plaintiffs have attempted to supplement the record with declarations. The parties have not filed the entire administrative record with this Court, but instead they have designated and submitted portions of the administrative record. In actions seeking review under the Administrative Procedures Act (APA), a court's review is confined to the "whole record or those parts of it cited by a party." 5 U.S.C. § 706 (emphasis added). In this case, the administrative record consists of seven binders of documents pertaining to the Forest Service's decision, and six folders of documents pertaining to the Bureau of Land Management's decision. Rather than producing the full record, the parties have chosen to produce and designate certain portions of the record for this Court's review. Given the scope of review, this presents no obstacle to the Court's ability to pass judgment. See 5 U.S.C. § 706.

In 2002, the BLM, with the consent of the Forest Service, began leasing 9,500 acres of subsurface federal oil and gas resources within the Huron-Manistee National Forest. Under the terms of the leases, the leaseholders acquire mineral rights, but they must submit separate applications to obtain permits to drill on the surface land. The applications must be approved by the BLM, Forest Service, the Michigan Department of Environmental Quality (MDEQ) and the Michigan Department of Natural Resources (MDNR) before drilling can commence. Under an interagency agreement established between the Forest Service and the BLM in 1991, the federal agencies' obligations are bifurcated; in essence, the Forest Service determines whether the surface aspects are consistent with federal law and policy, and the BLM addresses...