Sierra Club v. Secretary of Transp.

• Decision Date: 23 December 1985
• Docket Number: No. 85-1280,85-1280
• Citation: 779 F.2d 776
• Parties: , 16 Envtl. L. Rep. 20,487 SIERRA CLUB, et al., Plaintiffs, Appellees, v. SECRETARY OF TRANSPORTATION, et al., Defendants, Appellees, Maine Department of Transportation, Defendant, Appellant.
• Court: U.S. Court of Appeals — First Circuit

Page 776

779 F.2d 776

23 ERC 1761, 16 Envtl. L. Rep. 20,487

SIERRA CLUB, et al., Plaintiffs, Appellees, v. SECRETARY OF TRANSPORTATION, et al., Defendants, Appellees, Maine Department of Transportation, Defendant, Appellant.

No. 85-1280.

United States Court of Appeals,

First Circuit.

Argued Aug. 6, 1985.

Decided Dec. 23, 1985.

Cabanne Howard, Asst. Atty. Gen., with whom James E. Tierney, Atty. Gen., Augusta, Me., for State of Me., was on brief for defendant, appellant.

Edward F. Lawson with whom Peter L. Koff, Boston, Mass., was on brief, for plaintiffs, appellees.

Before CAMPBELL, Chief Judge, BOWNES and TORRUELLA, Circuit Judges.

BOWNES, Circuit Judge.

Defendant-appellant Maine Department of Transportation (Maine DOT) appeals a ruling by the United States District Court for the District of Maine in favor of the Sierra Club, the plaintiff below, holding that the Coast Guard had arbitrarily and capriciously issued a permit for the construction of a "bridge" between Kidder Point, Maine, and Sears Island, Maine. The district court revoked the permit. The Coast Guard, which was also named as a defendant in the suit below, has chosen not to appeal the district court's ruling.

This "bridge," which is part of a plan to develop a marine terminal for containerized cargo on Sears Island and, possibly, an industrial park there, was previously the subject of another lawsuit brought by the Sierra Club, Sierra Club v. Marsh, 769 F.2d 868 (1st Cir.1985) (Sierra Club I ). That case challenged the issuance of a construction permit for the "bridge" and marine terminal by the Army Corps of Engineers and the authorization for funding the project by the Federal Highway Administration without the preparation of an Environmental Impact Statement (EIS). In view of the fact that Maine DOT has raised a defense of res judicata in the present case based upon the proceedings in Sierra Club I, it will be necessary to start with a review of the proceedings in Sierra Club I.

In Sierra Club I, the Sierra Club named as defendants Secretary of the Army John Marsh for the Army Corps of Engineers and Secretary of Transportation Elizabeth Dole for the Federal Highway Administration. Maine DOT intervened. The defendants On November 12, 1984, discovery in Sierra Club I revealed that the Coast Guard and Maine DOT had treated an 1100-foot earth fill causeway as a "bridge" under the General Bridge Act of 1946, 33 U.S.C. Sec. 525(b) (1982), rather than as a "causeway" under Sec. 9 of the Rivers and Harbors Appropriation Act of 1899, 33 U.S.C. Sec. 401 (1982). This circumvented the stricter requirements of the Rivers and Harbors Act. The causeway was transformed into a bridge by including in the plans a small (two-foot diameter) pipe running from one side of the causeway to the other at its midpoint. The General Bridge Act permit had been issued on July 13, 1984. On November 19, 1984, the day Sierra Club I was scheduled for final argument on the merits, the Sierra Club sought to amend its complaint to include a count charging the Coast Guard with arbitrary and capricious action under the General Bridge Act and the Rivers and Harbors Act. The district court ruled that since the amendment required the addition of a new party who had not yet been served, the amendment would create delay which would be prejudicial to the defendants. The district court, therefore, denied leave to amend.

and Maine DOT had decided on the basis of several Environmental Assessments that the Sears Island project would not have a significant effect on the environment. The federal agencies each issued a "Finding of No Significant Impact," which permitted federal action to proceed without the preparation of an EIS, and authorized the start of construction. The Sierra Club then filed a complaint on October 17, 1984, charging that the agency findings of no significant impact were arbitrary and capricious and that the decision of the agencies to proceed without an EIS was a violation of the National Environmental Policy Act (NEPA), 42 U.S.C. Secs. 4332 et seq.

Fourteen days later, the Sierra Club filed a separate complaint charging the Coast Guard with arbitrary and capricious action under the General Bridge Act, violation of the Rivers and Harbors Act, and arbitrary and capricious action under NEPA for issuing the permit without an EIS. Maine DOT was also named as a defendant in this suit, the one now before us on appeal, which will be referred to here as Sierra Club II.

On January 17, 1985, the district court issued an opinion in Sierra Club I, holding that the findings of no significant impact were supported by the record and that there was no violation of NEPA by the Army Corps of Engineers or the Federal Highway Administration in proceeding without an EIS. The Sierra Club appealed.

In the meantime, the Coast Guard and Maine DOT moved to dismiss the complaint in Sierra Club II on the grounds that it was barred by res judicata and laches and that there was no private right of action under Sec. 9 of the Rivers and Harbors Act. The motions were denied to the extent they were based on res judicata and laches, but the issue of a private right of action was reserved until briefing and argument on the merits of the case. On March 16, 1984, the district court issued a memorandum and order holding that the Sierra Club's challenge was to Coast Guard action under the General Bridge Act and not action under the Rivers and Harbors Act and that the Sierra Club had a right of action under the Administrative Procedure Act, 5 U.S.C. Sec. 702 (1982), to review actions taken by the Coast Guard under the General Bridge Act. The district court then went on to hold that the Coast Guard's issuance of a permit under the General Bridge Act was "arbitrary, capricious, and contrary to law" because the structure in question was definitely a causeway rather than a bridge. The court found that congressional consent would have been necessary had the permit been for a causeway and that, by treating the structure as a bridge rather than a causeway, Maine DOT was able to avoid proving that the consent of Congress had been obtained for the structure. The district court issued an injunction revoking the permit issued by the Coast Guard without addressing the NEPA issues also raised by Sierra Club. This ruling has been appealed by Maine DOT and is the subject of our review in the present case.

Just after oral argument in Sierra Club II, we issued an opinion in Sierra Club I, finding that the Environmental Assessments relied upon by the agencies had failed to consider the secondary impact of the cargo terminal, i.e., the environmental impacts that would result from the development of an industrial park on the island. This meant that the Findings of No Significant Impact were unsupportable and that the decision to proceed without the preparation of an EIS was a violation of NEPA. The case was remanded to the district court, which had yet to act on it when this appeal was argued. In addition to filing an appeal in Sierra Club II, Maine DOT has filed a second application with the Coast Guard asking for a permit to build a causeway from Kidder Point to Sears Island. As a result of this court's decision in Sierra Club I, however, the Coast Guard has informed the Sierra Club that it will not take any action on this second application until an EIS is prepared.

We now return to Sierra Club II and the issues raised by Maine DOT on appeal. Maine DOT contends that these issues raised by the Sierra Club concerning the Coast Guard permit are merged into the judgment in Sierra Club I. These issues cannot be raised here because, had they been timely filed, the Sierra Club could have asserted these claims in Sierra Club I and it was only Sierra Club's lack of diligence which caused late discovery of the existence of the "bridge" claims. At the very minimum, Maine DOT argues, the claim that the Coast Guard violated NEPA by issuing a permit without an EIS is barred by the final judgment in Sierra Club I concerning precisely that issue in relation to the Army Corps of Engineers and the Federal Highway Administration.

RES JUDICATA

Maine DOT has argued that we should address the res judicata consequences of Sierra Club I on both the Bridge Act count and the NEPA count in Sierra Club II. Our resolution of this case, however, only requires us to consider whether the Bridge Act count is barred by res judicata. The district court began its analysis by considering whether the basic prerequisites of res judicata had been met, i.e., finality of judgment, identity of parties, and identity of claim. It stated that the parties were "arguably" identical because Secretary of Transportation Elizabeth Dole had been named in each action and, viewing the claims in Sierra Club I and II as arising from the same complex of facts, the district court reasoned that the two claims were "arguably" the same. It found, however, that it would be "grossly inequitable and improbable and not in accord with principle ... to hold at this time that res judicata bars the assertion" of the Bridge Act claim because the court itself had refused to allow Sierra Club's motion to add this claim "for procedural grounds, specifically related to the then posture of Sierra I."

Maine DOT argues that the district court erred in finding that the court's refusal to allow amendment in Sierra Club I blocked the application of res judicata as to those amendments. It suggests that the appropriate test is whether Sierra Club could have discovered by the exercise of reasonable diligence the existence of the Bridge Act claim in time to make a timely amendment in Sierra Club I. ¹ It is Maine DOT's contention that Sierra Club could have discovered the Coast Guard's intention to treat the causeway as a bridge as early as June 28, 1983, had it been following the progress of the permit.

We need not address the question whether Sierra Club could have timely raised the...