Hoosier Envtl. Council v. Natural Prairie Ind. Farmland Holdings, LLC

• Decision Date: 29 September 2021
• Docket Number: CAUSE NO. 4:19-CV-71 DRL-JEM
• Citation: 564 F.Supp.3d 683
• Parties: HOOSIER ENVIRONMENTAL COUNCIL et al., Plaintiffs, v. NATURAL PRAIRIE INDIANA FARMLAND HOLDINGS, LLC et al., Defendants.
• Court: U.S. District Court — Northern District of Indiana

564 F.Supp.3d 683

HOOSIER ENVIRONMENTAL COUNCIL et al., Plaintiffs,

v.NATURAL PRAIRIE INDIANA FARMLAND HOLDINGS, LLC et al., Defendants.

CAUSE NO. 4:19-CV-71 DRL-JEM

United States District Court, N.D. Indiana, South Bend Division.

Signed September 29, 2021

Kim E. Ferraro, Hoosier Environmental Council, Indianapolis, IN, Jeffrey Bruce Hyman, Conservation Law Center, Bloomington, IN, for Plaintiffs Hoosier Environmental Council, Indiana Audubon Society.

Kim E. Ferraro, Hoosier Environmental Council, Indianapolis, IN, for Plaintiffs Thomas Cutts, Debra Cutts, Alyssa Nyberg, Gustaf Nyberg, Steven Cowley.

Andrew M. McNeil, Bradley R. Sugarman, Daniel P. McInerny, Seth M. Thomas, Bose McKinney & Evans LLP, Indianapolis, IN, for Defendant Natural Prairie Indiana Farmland Holdings LLC.

Daniel R. Dertke, Benjamin Carlisle, US Department of Justice, Environment and Natural Resources Division, Washington, DC, Wayne T. Ault, US Attorney's Office, Hammond, IN, for Defendants Aaron W. Damrill, Gen Todd T. Semonite, United States Army Corps of Engineers.

OPINION & ORDER

Damon R. Leichty, Judge This case concerns a dairy farm. Natural Prairie Indiana Farmland Holdings, LLC purchased land in Newton County, Indiana to build and operate a concentrated animal feeding operation (CAFO) with over 4,350 dairy cows. The Army Corps of Engineers inspected the property and concluded that much of the land was not subject to the Clean Water Act. Two environmental advocacy organizations, the Hoosier Environmental Council (HEC) and Indiana Audubon Society (IAS), sued alleging that Natural Prairie violated the Clean Water Act and that the Army Corps of Engineers’ administrative jurisdictional determination violated the Administrative Procedures Act. Because the administrative record fails to show the agency considered relevant factors, the court finds the determination arbitrary and capricious and remands for further consideration.

BACKGROUND

By way of brief background, the land Natural Prairie purchased to construct its CAFO is unique. It is the former lakebed of Beaver Lake. The lake was drained in the early 1900s—then the largest natural lake in the State of Indiana—to make way for farmland. Beaver Lake was part of Grand Kankakee Marsh, once the country's largest inland wetland. Called the "Everglades of the North," the Grand Kankakee Marsh stretched almost a million acres across Northern Indiana and Illinois.

To drain Beaver Lake, engineers constructed several large ditches and drainage canals to move the water from the lake into the nearby Kankakee River, a "water of the United States" subject to various environmental regulations. Two of the drainage ditches—the Lawler Ditch and the Bogus Island Ditch (along with several smaller lateral ditches)—sit on Natural Prairie's land.

As alleged, without informing the government, Natural Prairie filled nearly half a mile of the Bogus Island Ditch and installed drainage "tiles," or underground pipes used to drain excess water from the soil. Natural Prairie filled and tiled various lateral ditches attached or near to the Lawler and Bogus Island Ditches. After these alterations, Natural Prairie contacted the Army Corps of Engineers to determine if the ditches, lateral ditches, and the land was subject to federal regulation. After a site visit, the Corps concluded the land was not a jurisdictional wetland, and that only the Lawler and Bogus Island Ditches were jurisdictional waters and under its regulatory control.

An environmental group has restored more than 7,000 acres of nearby wetlands and prairies at Kankakee Sands, a wetland preserve that boarders Natural Prairie's land. In addition to native flora and fauna (including a herd of buffalo), approximately 87 rare, threatened, or endangered species reportedly call the Kankakee Sands home.¹

In July 2019, HEC and IAS (and certain nearby residents) sued the Corps and Natural Prairie. Under the Administrative Procedures Act (APA), the associations seek judicial review of the Corps’ determination that the land is not a wetland and the lateral ditches are not jurisdictional waters. The associations also claim that Natural Prairie's filling and tiling of ditches without a permit, as well as altering a jurisdictional wetland without a permit, violated the Clean Water Act (CWA). See 33 U.S.C. §§ 1344 (permits for dredged or fill material), 1311(a) (prohibition of discharging a pollutant).

The magistrate judge bifurcated the case so that the APA claim could be addressed through discovery and summary judgment before proceeding with discovery on the CWA claim. After filing of several motions, including a motion to dismiss the CWA claim and crossmotions for summary judgment, the case was reassigned to this presiding judge earlier this year. Today the court rules on all pending motions, doing so in two opinions.

STANDARD

Summary judgment is warranted when "the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). The non-moving party must present the court with evidence on which a reasonable jury could rely to find in her favor. Goodman v. Nat'l Sec. Agency, Inc. , 621 F.3d 651, 654 (7th Cir. 2010). The court must deny summary judgment when there is admissible evidence that creates a genuine issue of material fact—a triable issue. Luster v. Ill. Dept. of Corrs. , 652 F.3d 726, 731 (7th Cir. 2011). The court "is not to sift through the evidence, pondering the nuances and inconsistencies, and decide whom to believe." Waldridge v. Am. Hoechst Corp. , 24 F.3d 918, 920 (7th Cir. 1994). Instead, the "court has one task and one task only: to decide, based on the evidence of record, whether there is any material dispute of fact that requires a trial." Id.

To overcome summary judgment, a party must set forth by affidavit or other evidence "specific facts" that "for purposes of the summary judgment motion will be taken to be true." Lujan v. Defenders of Wildlife , 504 U.S. 555, 561, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992) ; Fed. R. Civ. P. 56(c)(4), (e).² The court must construe all facts in the light most favorable to the non-moving party, view all reasonable inferences in that party's favor, Bellaver v. Quanex Corp. , 200 F.3d 485, 491-92 (7th Cir. 2000), and avoid "the temptation to decide which party's version of the facts is more likely true," Payne v. Pauley , 337 F.3d 767, 770 (7th Cir. 2003). In a case involving crossmotions for summary judgment, each party receives the benefit of all reasonable inferences drawn from the record when considering the opposing party's motion.

Tegtmeier v. Midwest Operating Eng'rs Pension Trust Fund , 390 F.3d 1040, 1045 (7th Cir. 2004).

A. The Court Denies Natural Prairie's Summary Judgment Motion.

Natural Prairie argues that the associations lack both Article III and statutory standing. The associations contest this assertion. Apart from joining Natural Prairie's motion, the Corps filed a response disagreeing with certain of the arguments advanced in Natural Prairie's motion related to administrative standing. The court takes up these standing arguments in turn.

1. The Associations Have Article III Standing to Sue the Corps for Violation of the Administrative Procedures Act.

Natural Prairie argues that HEC and IAS lack constitutional standing because they aren't adversely affected by the Corps’ approved jurisdictional determination. Natural Prairie claims that the agency's decision never impacted the HEC, IAS, or their properties. In short, the Corps’ decision only impacted the farm, not the surrounding land.

The court must ensure its jurisdiction. See Common Cause Ind. v. Lawson , 937 F.3d 944, 949 (7th Cir. 2019) ; Simic v. City of Chi. , 851 F.3d 734, 738 (7th Cir. 2017). The United States Constitution confines the federal judiciary's power to "Cases" and "Controversies." U.S. Const. art. III § 2. For a case or controversy to exist, a plaintiff must have standing—an injury, fairly traceable to the defendant's conduct, that the court's decision will likely redress. Uzuegbunam v. Preczewski , ––– U.S. ––––, 141 S. Ct. 792, 797, 209 L.Ed.2d 94 (2021) ; Spokeo, Inc. v. Robins , 578 U.S. 330, 136 S. Ct. 1540, 1547, 194 L.Ed.2d 635 (2016).

A plaintiff must have an actual stake in the dispute. See Matlin v. Spin Master Corp. , 979 F.3d 1177, 1181 (7th Cir. 2020). Without an actual stake, a court order is nothing more than legal advice—an advisory opinion that lawyers, not judges, are paid to give. See id. The plaintiff's injury must be "concrete and particularized" and "actual or imminent, not conjectural or hypothetical." Friends of the Earth, Inc. v. Laidlaw Environmental Services (TOC), Inc. , 528 U.S. 167, 180-81, 120 S.Ct. 693, 145 L.Ed.2d 610 (2000) (quoting Lujan , 504 U.S. at 560-61, 112 S.Ct. 2130 ). An association of members (such as HEC or IAS) has standing "when its members would otherwise have standing to sue in their own right, the interests at stake are germane to the organization's purpose, and neither the claim asserted nor the relief requested requires the participation of individual members in the lawsuit." Id. at 181, 120 S.Ct. 693 (citation omitted).

No one seriously contests the last two requirements. HEC and IAS are both Indiana environmental advocacy and conservation organizations whose members regularly use the Kankakee River areas, including downstream from the CAFO site. These organizations are devoted to protecting Indiana's waterways, wildlife, and wildlife habitat. The suit's subject matter pertains to these organizational raisons d’être. See Retired Chi. Police Ass'n v. City of Chi. , 7 F.3d 584, 607 (7th Cir. 1993) (need only show "an organization's litigation goals [are] pertinent to its special expertise and the grounds that bring its membership together"). And neither the claim nor requested relief require the indispensable participation of individual members, see Hunt v. Wash. St. Apple Advertising Comm'n , 432...