Hayes v. Halland
| Docket Number | 4:16-cv-00615-JAR-CDL |
| Decision Date | 07 November 2023 |
| Parties | DAVID P. HAYES, TRUSTEE FOR THE PAUL B. HAYES FAMILY TRUST, DATED APRIL 30, 2010 Plaintiff, v. DEB HALLAND, in her official capacity as Secretary of the United States Department of the Interior, the UNITED STATES BUREAU OF INDIAN AFFAIRS, DARRYL LACOUNTE, in his official capacity as Director of the United States Bureau of Indian Affairs, WARRIOR EXPLORATION & PRODUCTION, LLC, and PERFORMANCE GROUP, LLC Defendants. |
| Court | U.S. District Court — Northern District of Oklahoma |
This case involves the second attempt by the Bureau of Indian Affairs (“BIA”) to comply with the National Environmental Policy Act of 1969 (“NEPA”) while approving oil and gas leases in Osage County, Oklahoma. In the first challenge, brought by the Paul B. Hayes Family Trust, Dated April 30, 2010 (“Hayes”), the court invalidated a lease and associated drilling permits on the Hayes property and remanded the matter to the United States Bureau of Indian Affairs (“BIA”). Hayes v Chaparral Energy, LLC, 180 F.Supp.3d 902, 915 (N.D Okla. Mar. 29, 2016), rev'd and vacated as moot sub nom. Hayes v. Osage Minerals Council, 699 Fed.Appx. 799 (10th Cir. 2017) (“Hayes I”). The Tenth Circuit later vacated the district court's orders finding that “the BIA's new NEPA analysis mooted [the] appeal . . . .” Hayes v. Osage Minerals Council, 699 Fed.Appx. at 803. Now, Hayes brings this action, arguing that the BIA's new NEPA analysis, a Programmatic Assessment for Leasing Activities (“Leasing PEA”) and resulting Finding Of No Significant Impact (“FONSI”), that mooted the appeal in Hayes I, is itself flawed and should be vacated.
Hayes commenced this action against Sally Jewell,[1] in her official capacity as Secretary of the United States Department of Interior; the United States Bureau of Indian Affairs, an agency within the United States Department of Interior; Michael Black, in his official capacity as Director of the United States Bureau of Indian Affairs (collectively, “the government”); as well as private actors Warrior Exploration & Production, LLC; and Performance Group, LLC (collectively, “non-federal defendants”), alleging violations of the National Environmental Policy Act of 1969, 42 U.S.C. § 4321 (2018) under the Administrative Procedure Act (“APA”), 5 U.S.C. § 706(2)(A), as well as common law claims of trespass. Pl.'s Opening Br. at 1, ECF No. 47 (Apr. 14, 2017) (“Hayes Br.”). In addition to these claims, before the court is a motion by the government to dismiss certain claims on mootness grounds under Fed.R.Civ.P. 12(b)(1). Def.'s Mot. to Partially Dismiss on Mootness Grounds, ECF No. 94 (May 5, 2023) (“Gov. Mootness Br.”).
For the forgoing reasons, the court concludes that the BIA failed to comply with NEPA. Accordingly, applying the APA to the Leasing PEA and resulting FONSI, the court concludes that they were arbitrary and capricious. The court also concludes, however, that several of Hayes' other claims were not exhausted and others are moot after the BIA's recent publication of an Environmental Impact Statement (“EIS”). Finally, the court concludes that Hayes' claim for common law trespass fails.
“The twin aims of NEPA are to require agencies to consider every significant aspect of the environmental impact of a proposed action and to facilitate public involvement.” High Country Conservation Advocs. v. U.S. Forest Serv., 951 F.3d 1217, 1223 (10th Cir. 2020) (internal quotation marks and citations omitted). “NEPA creates ‘a set of action-forcing procedures that require that agencies take a hard look at environmental consequences, and that provide for broad dissemination of relevant environmental information.'” Id. (quoting Robertson v. Methow Valley Citizens Council, 490 U.S. 332, 350 (1989)).
Specifically, “NEPA requires federal agencies to pause before committing resources to a project and consider the likely environmental impacts . . . .” New Mexico ex rel. Richardson v. BLM, 565 F.3d 683, 703 (10th Cir. 2009). Depending on the scope of the project, agencies must consider the likely environmental impacts at a project-wide, and site-specific, level. See Richardson, 565 F.3d at 716-19 (); see also 40 C.F.R. § 1501.11 (2022)[2] (encouraging agencies to wait to conduct site-specific analysis until the location of potential impacts of an action are sufficiently definite).
Federal agencies must prepare an EIS for “major Federal actions significantly affecting the quality of the human environment.” 42 U.S.C. § 4332(2)(C); Richardson, 565 F.3d at 703. An EIS sets out reasonable planning alternatives for a proposed action, generally including a “preferred alternative,” and analyzes the environmental impacts of each. 40 C.F.R. § 1502.14 (2022). Where it is unclear what a federal action's impact will be, or where actions are not likely to significantly affect the quality of the human environment, agencies may prepare an Environmental Assessment (“EA”) prior to commissioning an EIS. Id. § 1501.3 (2022). Both an EA and an EIS must consider a range of reasonable alternatives, see id. §§ 1501.5(c)(2), 1502.14, but the depth of discussion and analysis required for an EIS is more extensive than for an EA. See e.g., Western Watersheds Project v. BLM, 721 F.3d 1264, 1274 (10th Cir. 2013).
If an agency determines, after preparing an EA, that the action will not have significant effects on the quality of the human environment, the agency may issue a FONSI. Richardson, 565 F.3d at 703; 40 C.F.R. §§ 1501.5, 1501.6 (2022). A FONSI may eliminate the need to conduct an EIS. 40 C.F.R. § 1501.6 (2022). But, if it becomes apparent that the action is likely to have a significant impact, an EIS must be prepared. Richardson, 565 F.3d at 703.
Hayes is the owner of the surface rights to approximately 475 acres of land in Osage County. Hayes Br. at 5. The subterranean rights of that land, however, are held in trust by the Osage Nation and managed by the Osage Agency within the BIA. Act of June 28, 1906, Pub. L. No. 59-321, § 3, 34 Stat. 539, 543-44.
In early 2012, the Osage Nation and Chaparral Energy, LLC (“Chaparral”) entered into an oil and gas mining lease (“Lease 22411”) for mineral rights located beneath the Hayes estate. Administrative Record at 577-79, ECF Nos. 31-42 (Mar. 15, 2017) (“AR”). Shortly thereafter, the Superintendent of the Osage Agency approved Lease 22411 without conducting a NEPA analysis. Id. Later that year, Chaparral submitted applications for drilling permits (“APDs”) for six oil wells and one saltwater disposal well pursuant to Lease 22411, and the BIA approved each APD, again without conducting a NEPA analysis. Hayes Br. at 5; Federal Defs.' Resp. Br. at 7, ECF No. 54 (May 25, 2017) (“Gov. Br.”).
In early January 2013, the Osage Nation and Chaparral entered into a second oil and gas mining lease (“Lease 22770”), also for additional mineral rights beneath the Hayes estate. AR at 749-51. The Superintendent of the Osage Agency approved Lease 22770, again without conducting a NEPA analysis. Id. In 2014 Chaparral submitted and the Superintendent approved two APDs for wells pursuant to Lease 22770 without conducting a NEPA analysis. Hayes Br. at 6; Gov. Br. at 7.
By October 31, 2014, nine wells were produced on land covered by Lease 22411, and two were produced on land covered by Lease 22770. AR at 660, 670. On October 26, 2015, Chaparral conveyed the leases to Warrior Exploration & Production, LLC (“Warrior”). AR at 608, 829.
Previously, in August 2014, Hayes commenced an action against the government and the non-federal defendants, alleging various environmental violations under federal law and trespass under the common law of Oklahoma. Hayes I, 180 F.Supp.3d at 905. On March 29, 2016, the court issued an opinion and order[3]finding that the BIA's approval of leases and drilling permits failed to comply with NEPA, invalidating the permits to drill on the leased premises, and remanding the matter to the BIA. Hayes I, 180 F.Supp.3d at 915. Hayes I would later be overturned in 2017 by the Tenth Circuit due to mootness, after the BIA retroactively approved Leases 22411 and 22770 based on subsequent NEPA analysis.[4] Hayes v. Osage Minerals Council, 699 Fed.Appx. 799, 803 (10th Cir. 2017).
Shortly after the initial approval of Leases 22411 and 22770, the BIA began additional NEPA analysis: first an EIS and then an EA. AR at 241, 446. In 2013 the BIA started work on a Programmatic Environmental Impact Statement for Oil and Gas Production from the Osage Mineral Estate (“Osage EIS”).[5] While waiting for the completion of the Osage EIS, the BIA completed the Leasing PEA. AR at 239-301, 699. The BIA determined, based on the Leasing PEA, that an EIS was not required for leasing actions,[6] and on November 26, 2014, issued a FONSI. AR at 302, 306.
On June 24, 2016, three months after Hayes I invalidated the leases due to failure to comply with NEPA, the BIA retroactively approved Leases 22411 and 22770 back to January 3, 2013, under 25 C.F.R. § 226.15(b) (2016). AR at 699-700, 826-27. The retroactive approvals included a new term requiring the lessee to “first obtain appropriate BIA permits before conducting any operations that would result in ground-disturbance.” AR at 699; 826. By the time these terms and conditions were added, however, eleven wells had already been drilled on Hayes' land without sitespecific analysis. See AR at 599, 676, 689. The court is not aware of any site-specific analysis conducted after the retroactive approval.
On July 22, 2016, Hayes...
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