Appeals court upholds Salazar’s decision to cancel 77 Utah leases

Lands near Dinosaur National Monument were among the area leased. : Photo- Mestdagh via flickr

By Scott Streater

E&E reporter

The long legal battle over Interior Secretary Ken Salazar’s controversial 2009 decision to cancel 77 leases near pristine federal lands in Utah may have finally reached its end.

The U.S. 10th Circuit Court of Appeals in Denver late yesterday issued a 22-page opinion upholding Salazar’s decision to cancel the leases sold at a December 2008 auction, ruling that a coalition of energy companies and Utah counties did not file its federal lawsuit within 90 days of Salazar’s decision.

The May 2009 lawsuit was brought against federal officials by three Utah counties — including Uintah County, a sharp critic of the Obama administration’s land-use policies — and three energy companies that had successfully bid on some of the canceled parcels. They had argued that the lease parcels covering more than 100,000 acres of Bureau of Land Management holdings in the state should be reinstated.

The plaintiffs could appeal the ruling to the U.S. Supreme Court, though observers said that is unlikely. “We hope this will be the end for these 77 leases,” said Robin Cooley, an Earthjustice staff attorney in Denver who argued the case on behalf of a coalition of environmental groups that intervened in the lawsuit to support Interior’s decision.

The decision basically upholds a late 2010 ruling by U.S. District Court Judge Dee Benson in Salt Lake City that concluded a lawsuit challenging Salazar’s actions was filed too late to return the leases to their original owners (Land Letter, Sept. 9, 2010).

Benson, however, ruled that Salazar “exceeded his statutory authority by withdrawing leases” after the competitive lease sale. But the lawsuit could not proceed because of the “strict statute of limitations” of 90 days after the secretary’s final decision, according to the ruling.

The three-judge appeals panel decision yesterday essentially concurs that the appeal needed to filed within 90 days of Salazar’s Feb. 6, 2009, decision.

The judges wrote that Interior made a final decision on Feb. 6 in the form of an internal memorandum, “and the companies acknowledged the possibility that the government’s position would hold sway,” according to the ruling. “Despite this knowledge, the Energy Companies gambled” on their interpretation that the actual date of a final decision was on Feb. 12, six days later, when Salazar sent a letter to the plaintiffs informing them of his decision and authorizing their lease payments to be refunded, according to the ruling.

“This gamble did not pay off,” the judges wrote.

But Judge Timothy Tymkovich wrote yesterday in a dissenting opinion that the Feb. 6 memo could not be the final agency action here because the memo did not withdraw the leases but instead anticipated that further steps would be needed to orchestrate the withdrawals, according to the appeals ruling.

And Tymkovich criticized previous arguments from Interior that notice of the formal decision had been made two days earlier, on Feb. 4, during a press conference in which Salazar announced he planned to retroactively withdraw the leases in question.

“The notion that a press conference could constitute a formal agency decision — let alone a ‘final’ one — is truly extraordinary,” he wrote. “The Department of the Interior’s own regulations give no support to the notion that, prior to this case, the Department ever claimed the power to rule by press conference. To the contrary, the regulations codifying the Secretary’s power to review his subordinates’ decisions explicitly require a ‘written decision.'”

Denver-based QEP Resources Inc., one of the three companies challenging Salazar’s decision, issued a statement yesterday stating that the company was “disappointed” with the appeals court ruling but was encouraged by Tymkovich’s dissent.


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September 2012