Case against Forest Service by Oil, Gas Assn. ruled moot


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Relying on precedent that federal agencies may avoid litigation by taking steps to cure National Environmental Policy Act violations on their own, a federal judge has ruled that a case in which oil and gas industry groups sued the U.S. Forest Service over its 2007 revised land resource management plan for the Allegheny National Forest is moot now that the agency has backed off enacting the revisions.

In Pennsylvania Oil and Gas Association v. U.S. Forest Service, U.S. District Judge Mark R. Hornak of the Western District of Pennsylvania ruled that there is "no justiciable case or controversy" because the chief of the Forest Service has already overturned the provisions of the 2007 plan that would have revised the agency's 1986 plan by restricting oil and gas development in the forest.

The ruling did, however, preserve the ability of the plaintiffs to "reopen this case and pick up where they left off, should the Forest Service resume the challenged activity by discontinuance of its adherence to the 1986 plan."

The judge referred to the case as the "latest skirmish" between the oil and gas industry and the U.S. Forest Service over drilling operations in the forest.

The ruling comes just shy of six months after the U.S. Court of Appeals for the Third Circuit ruled in Minard Run Oil v. U.S. Forest Service -- known as Minard Run IV -- that a Western District court was right to convert its initial grant of a preliminary injunction into a final declaratory judgment allowing oil and gas drillers to proceed with extraction operations without first conducting an environmental impact study.

Judge Hornak relied on the U.S. District Court for the Western District of Pennsylvania's 2001 ruling in Citizens Advisory Committee on Private Prisons v. U.S. Department of Justice, in which it held that agencies are allowed a second chance to correct NEPA violations.

"As in Citizens Advisory Committee, the Forest Service has admitted its own NEPA violations, suspended the offending procedures, and is either attempting to correct them through the [supplemental environmental impact statement] process, or has abandoned them," the judge said. "In the meantime, the Forest Service is managing oil and gas interests in the [Allegheny National Forest] in precisely the manner that the plaintiffs would like them to: pursuant to the provisions of the 1986 plan and the well-established framework of Minard Run. This is precisely what NEPA requires, and is the issue at the heart of plaintiffs' claims in this action."

In Minard Run II, according to court documents, mineral rights owners, joined by oil and gas companies, filed suit against the Forest Service after it struck a settlement with two environmental groups that significantly changed its process for approving drilling by suspending all approvals while it conducted a multiyear environmental impact study.

The plaintiffs won a preliminary injunction in 2009, which the Third Circuit upheld and which then-U.S. District Chief Judge Sean McLaughlin of the Western District of Pennsylvania later converted to a permanent injunction, requiring the Forest Service to approve drilling plans without environmental impact studies.

While the Minard Run litigation was unfolding, Judge Hornak said, the Forest Service was also working on a plan to revise its 1986 Allegheny National Forest plan, under which the agency had been engaging in a cooperative process that allowed mineral rights owners to give the agency 60 days' notice of their drilling plans.

While a preliminary draft of the revised plan issued by the Forest Service in 2006 kept that process intact, according to Judge Hornak, several new measures and design criteria restricting private oil and gas development were added before the final environmental impact statement and record of decision for the revised plan was approved by the regional forester in February 2007.

The Pennsylvania Independent Oil and Gas Association and the Allegheny Forest Alliance administratively appealed the 2007 plan, arguing that the new measures restricting drilling were added without any opportunity for public comment and that the Forest Service had no authority to regulate the extraction of privately owned minerals, Judge Hornak said.

In February 2008, the Forest Service chief issued a decision agreeing with the plaintiffs and suspending all new oil and gas measures, the judge said. The chief ordered the Forest Service to continue adhering to the cooperative process under the 1986 plan.

While the Forest Service did not dispute that the provisions of the 2007 plan seeking to restrict and regulate private oil and gas extraction violated NEPA, the parties did disagree on an appropriate remedy, according to Judge Hornak.

The plaintiffs argued that the 2007 plan should be invalidated in its entirety, but the Forest Service maintained that simply striking the provisions restricting oil and gas operations, reinstating the 1986 plan and giving the agency an opportunity to fix the identified problems constituted an adequate remedy, the judge said.

He agreed with the Forest Service, relying on the reasoning in Citizens Advisory Committee.

Counsel for the plaintiffs, Matthew L. Wolford of Erie, said the court left open the possibility for his clients to challenge a future attempt by the Forest Service to move away from the 1986 plan without having to refile a complaint.

(Copies of the 14-page opinion in Pennsylvania Oil and Gas Association v. U.S. Forest Service, PICS No. 14-0278, are available from The Legal Intelligencer at 2-800-276-PICS.)

Zack Needles can be contacted at zneedles@alm.com or at 215-557-2493. Follow him on Twitter @ZNeedlesTLI. To read more articles like this, visit www.thelegalintelligencer.com.


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