Justia U.S. Federal Circuit Court of Appeals Opinion Summaries

Articles Posted in Environmental Law
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Taylor's leases for the Outer Continental Shelf (OCS), set to expire in 2007, incorporated Outer Continental Shelf Lands Act (OCSLA), 43 U.S.C. 1301, regulations. They required Taylor to leave the leased area “in a manner satisfactory to the [Regional] Director.” Taylor drilled 28 wells, each connected to an oil platform. In 2004, Hurricane Ivan toppled Taylor’s platform, rendering the wells inoperable. Taylor discovered leaking oil but took no action. In 2007, Taylor was ordered to decommission the wells within one year. Taylor sought extensions. The government required Taylor to set aside funds for its decommissioning obligations. For Taylor to receive reimbursement, the government must confirm the work was conducted “in material compliance with all applicable federal laws and . . . regulations" and with the Leases. The resulting Trust Agreement states that it “shall be governed by and construed in accordance with the laws of" Louisiana. Taylor attempted to fulfill its obligations. The government approved a departure from certain standards but ultimately refused to relieve Taylor of its responsibilities.Taylor filed claims involving Louisiana state law: breach of the Trust Agreement; request for dissolution of the trust account based on impossibility of performance; request for reformation for mutual error; and breach of the duty of good faith and fair dealing. The Federal Circuit affirmed the dismissal of the complaint. OCSLA makes federal law exclusive in its regulation of the OCS. To the extent federal law applies to a particular issue, state law is inapplicable. OCSLA regulations address the arguments underlying Taylor’s contract claims, so Louisiana state law cannot be adopted as surrogate law. View "Taylor Energy Co. LLC v. United States" on Justia Law

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The Federal Highway Administration (FHA) issued a solicitation for the "Deweyville" project, consisting of reconstructing approximately 12 miles of road running through Alaska's Tongass National Forest. The FHA provided a Waste Site Report, which identified sites that a contractor could use to dispose of waste materials and provided access to the “Categorical Exclusion,” prepared under the National Environmental Policy Act, 42 U.S.C. 4321–70.2, which stated that waste sites are expected to be sourced at existing quarries identified in the Waste Site Report. The solicitation placed responsibility for licenses and permits on the contractor, including Clean Water Act permits, 33 U.S.C. 1344, and purchasing wetland mitigation credits. Kiewit’s successful bid included approximately $1,000,000 for wetland mitigation fees. Kiewit requested an equitable adjustment for the cost of purchasing mitigation credits for the wetlands it encountered at government-designated waste sites. The Claims Court upheld the denial of that request.The Federal Circuit reversed. The contract documents dictate that, unless a contractor decided to expand the government-designated waste sites, “[n]o further analysis of the environmental impacts of” such sites would be necessary. That the FHA, during the NEPA process, had already assessed the project’s effects on wetlands bolstered Kiewit’s reasonable conclusion that it would not need to conduct further wetlands analysis at designated waste disposal areas. Kiewit reasonably interpreted the documents to mean what they say—that no further environmental impacts analysis would be required if a contractor chose to dispose of waste at government-designated sites. The FHA effected a constructive contract change when it required Kiewit to perform wetland delineation at those sites. View "Kiewit Infrastructure West Co. v. United States" on Justia Law

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Water levels in Eagle Lake, near Vicksburg, are controlled by the Muddy Bayou Control Structure, part of the Army Corps of Engineers’ Mississippi River flood control program. Eagle Lake's predictable water levels allowed the plaintiffs to build piers, boathouses, and docks. In 2010, the Corps determined that “sand boils” threatened the stability of the nearby Mississippi River Mainline Levee, a component of the same flood-control program. Unusually wet weather in 2011 exacerbated the problem. The Corps declared an emergency, finding that the rise in nearby water levels threatened the structural integrity of the levee and “that the likelihood of breach was over 95%.” The Corps decided to flood Eagle Lake to reduce pressures along the levee. Because of that action, the levee did not breach. A breach would have resulted in widespread flooding affecting “about a million acres and possibly between four thousand to six thousand homes and businesses.” The damage to the plaintiffs’ properties would have exceeded the damage caused by raising the lake level. The plaintiffs sued, seeking compensation. The Federal Circuit reversed the Claims Court’s finding that the government was liable and award of $168,000 in compensatory damages. The relative benefits doctrine bars liability. The plaintiffs were better off as a result of the Corps’ actions. If the government had not raised the water level, the levee would almost certainly have breached, and the plaintiffs would have suffered more damage. View "Alford v. United States" on Justia Law

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GIP purchased property from a steel mill’s bankruptcy estate, omitting the “Eastern Excluded Property” (EEP). GIP purchased some personal property located on the EEP, which contains two piles comprising slag (a steel manufacturing byproduct), kish (a byproduct of a blast furnace operation), and scrap. Each pile occupied more than 10 acres and was more than 80 feet high. GIP's "Itemization of Excluded Item from Sale” referred to: “All by-products of production other than kish and 420,000 cubic yards of slag” on the EEP “with a reasonable period of time to remove such items.” The EPA began investigating contaminants leaching from the piles. While GIP was negotiating for the separation of recoverable metals, the EPA decided to reduce the size of the piles. In 2009-2013, EPA contractors recovered and sold 245,890 tons of material and recovered and used 92,500 cubic yards of slag onsite for environmental remediation; they processed approximately 50% of the piles, spending about $14.5 million, about a million more than income from sales. The EPA compacted the materials to minimize leachate, leaving further remediation to state environmental authorities. GIP did not attempt its own recovery operation during the EPA remediation.GIP sued, alleging “takings” of the slag, kish, and scrap. The trial court awarded GIP $755,494 for the slag but awarded zero damages for the kish and scrap. The Federal Circuit vacated in part. GIP had no claim to any particular subset of slag. The trial court erred in finding that the EPA somehow prevented GIP from recovering its full allotment of slag; GIP cannot establish a cognizable property interest in the slag that was recovered. The court affirmed in part. GIP’s unreliable calculations left the trial court without competent evidence relating to a critical component of the damages calculation with respect to the kish and scrap. View "Gadsden Industrial Park, LLC v. United States" on Justia Law

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Syngenta sued Willowood, a Hong Kong company that sells fungicide to its Oregon-based affiliate, for infringement of patents directed to a fungicide compound and its manufacturing processes and infringement of copyrights for detailed product labels that provide directions for use, storage, and disposal, plus first-aid instructions and environmental, physical, and chemical hazard warnings. The district court dismissed the copyright claims as precluded by the Federal Insecticide Fungicide and Rodenticide Act (FIFRA), 7 U.S.C. 135 and granted-in-part Syngenta’s summary judgment motion with respect to patent infringement. After a jury trial, the court entered a defense judgment on the patent claims. The Federal Circuit affirmed-in-part, reversed-in-part, and vacated in part. The district court did not provide an adequate analysis of the potential conflict between FIFRA and the Copyright Act. Because FIFRA does not, on its face, require a “me-too” registrant to copy the label of a registered product, FIFRA only conflicts with the Copyright Act to the extent that some particular element of Syngenta’s label is both protected under copyright doctrines and necessary for the expedited approval of Willowood’s generic pesticide. The court erred by imposing a single-entity requirement on the performance of a patented process under 35 U.S.C. 271(g); practicing a patented process abroad does not trigger liability under section 271(g) in the same manner that practicing a patented process domestically does under section 271(a). View "Syngenta Crop Protection, LLC v. Willowood, LLC" on Justia Law

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The Klamath River Basin Reclamation Project straddles the Oregon-California border and provides water to hundreds of farms. The Project is managed by the Bureau of Reclamation. In 2001, the Bureau temporarily halted water delivery to farms and water districts in order to comply with its tribal trust obligations under the Endangered Species Act, 16 U.S.C. 1531. Plaintiffs alleged that action amounted to a taking without compensation, impaired their rights under the Klamath River Basin Compact, and caused the breach of water delivery contracts. The Claims Court rejected the suit on summary judgment. On remand, the Claims Court dismissed the breach of contract claims, determined that the takings claims should be analyzed as “physical takings,” and held a trial. The districts had been voluntarily dismissed as plaintiffs. As to the individual farmers, the Claims Court held that the Bureau’s actions did not amount to a taking and did not violate the Compact because the rights reserved for tribal fishing were superior. The Federal Circuit affirmed, finding the plaintiffs’ state water rights subordinate to the federal tribal rights, which were recognized in an 1864 treaty. The Bureau acted reasonably to preserve water levels necessary to avoid endangering fish. View "Baley v. United States" on Justia Law

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In 2005, the Ginsburgs, through their corporation (Hawthorne), acquired Brooklyn property and applied to participate in the Brownfield Cleanup Program. The New York State Department of Environmental Conservation (DEC) approved their application and the parties entered into an Agreement. The development was completed in 2011, converting an old shoe factory into a residential rental building. In 2011, the Ginsburgs granted the state an environmental easement; DEC issued a certificate of completion. Hawthorne applied for a brownfield redevelopment tax credit of $6,583,835.10 for tax year 2011, with the Ginsburgs’ share equaling $4,975,595.00, In 2013, the state paid the Ginsburgs a refund of $1,903,951.00 attributable to the brownfield redevelopment tax credit. They did not report the payment as income on their 2013 federal income tax return, claiming that this payment constituted a nontaxable refund.The IRS determined the Ginsburgs owed an additional $690,628.46 in federal income tax, which they paid. The Federal Circuit affirmed the Claims Court, holding that the excess payment of the tax credit they had received from the state is federally taxable income and “does not qualify for any exclusion or exception from the federal definition of income.” The Ginsburgs freely chose to participate and take advantage of New York’s state tax credit program and have complete dominion and control over the payment because there is a legally adequate guarantee that they will be allowed to excess amount of the tax credit, barring actionable misconduct on their part. View "Ginsburg v. United States" on Justia Law

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In 1942-1943, the Government contracted with the Oil Companies to purchase aviation gasoline, vital to the war effort, permitting a profit margin “between 6% and 7%.” The manufacture of avgas from crude oil uses a 98% purity sulfuric acid as a catalyst in alkylation, a process that dilutes the sulfuric acid such that it turns it into “spent alkylation acid,” which may be used to catalyze the alkylation process again following purification; produce non-avgas petroleum by-products; or be disposed of. If spent alkylation acid is used to produce other petroleum by-products, it becomes "acidic sludge," a secondary waste with a lesser percentage of acid content that can be used to manufacture fertilizer, burned, or disposed of. Unable to reprocess the increased amount of spent alkylation acid given the prioritization of production, the Companies dumped spent alkylation acid and acid sludge in California: 12 percent of the waste was spent alkylation acid, and 82.5% was acid sludge. In 1991, the Government and California sued the Companies under the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. 9601, for costs of cleaning up the disposal site. The Companies countersued. After years of litigation, the Claims Court granted the Companies partial summary judgment to prevent discovery into insurance settlements; denied the Government’s motion for leave to assert counterclaims in fraud; held that the Government was liable for clean-up costs for nonbenzol waste--$99,509,847.32, including accrued interest. The Federal Circuit affirmed, rejecting arguments that the Claims Court failed to allocate between recoverable and nonrecoverable costs, wrongfully admitted stipulations to calculate damages, and wrongly refused to allow proof of double recovery by insurance settlements. View "Shell Oil Co. v. United States" on Justia Law

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The Inholders own patented mining and homestead claims within the Santa Fe National Forest. The 2011 Las Conchas Fire caused widespread destruction of vegetation within the forest. Forest Roads 89 and 268, which the Inholders had used to access their properties, were severely damaged by subsequent flooding. The Forest Service notified them that the roads were “impassible” and that it would provide them with limited access: “a combination of driving and hiking over specific routes and under specific weather conditions.” Later, the Service sent a letter stating that “public safety would be highly threatened by use of” the roads; that it would close the roads to public access for the foreseeable future; that because of continuing terrain instability, any reconstruction would likely be destroyed by future flooding; and, even if reconstruction were possible, the Service could not justify expending public funds when there is no general public need. The Service suggested that the Inholders work “collectively” to reconstruct the roads. The Inholders claimed that they held statutorily-granted easements. The USDA disagreed, citing 90 Stat. 2743, but acknowledged that the Inholders had a right to access their properties, “subject to reasonable regulations.” The Inholders claimed a compensable taking. The Federal Circuit affirmed the Claims Court’s dismissal, finding that the Inholders had not adequately pled a physical taking and that any regulatory taking claim was not ripe because the Inholders had not applied for a permit to reconstruct the roads. View "Martin v. United States" on Justia Law

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Trona is a sodium carbonate compound that is processed into soda ash or baking soda. Because oil and gas development posed a risk to the extraction of trona and trona worker safety, the Bureau of Land Management (BLM), which manages the leasing of federal public land for mineral development, indefinitely suspended all oil and gas leases in the mechanically mineable trona area (MMTA) of Wyoming. The area includes 26 pre-existing oil and gas leases owned by Barlow. Barlow filed suit, alleging that the BLM’s suspension of oil and gas leases constituted a taking of Barlow’s interests without just compensation and constituted a breach of both the express provisions of the leases and their implied covenants of good faith and fair dealing. The Federal Circuit affirmed the Claims Court’s dismissal of the contract claims on the merits and of the takings claim as unripe. BLM has not repudiated the contracts and Barlow did not establish that seeking a permit to drill would be futile. View "Barlow & Haun, Inc. v. United States" on Justia Law