Conservation Northwest, et al v. Mark Rey, et al

Filing

FILED OPINION (ALEX KOZINSKI, A. WALLACE TASHIMA and MILAN D. SMITH, JR.) REVERSED AND REMANDED. Judge: AWT Authoring, FILED AND ENTERED JUDGMENT. [8603987]

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FOR PUBLICATION

UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT

CONSERVATION NORTHWEST ;
GIFFORD PINCHOT TASK FORCE ;
ENVIRONMENTAL PROTECTION
INFORMATION CENTER ; KLAMATH
FOREST ALLIANCE ; UMPQUA
WATERSHEDS INC.; SISKIYOU
REGIONAL EDUCATION PROJECT ;
KLAMATH -SISKIYOU WILDLANDS
CENTER ; OREGON WILD ; AMERICAN
LANDS ALLIANCE ; CENTER FOR
BIOLOGICAL DIVERSITY ;
NORTHCOAST ENVIRONMENTAL
CENTER ,
Plaintiffs-Appellees,
v.
HARRIS SHERMAN ; MARCILYNN
BURKE ; TERRY RABOT ; UNITED
STATES FOREST SERVICE; BUREAU
OF LAND MANAGEMENT ; U.S. FISH
AND WILDLIFE SERVICE ,
Defendants-Appellees,
D.R. JOHNSON LUMBER COMPANY ,
Intervenor-Defendant-Appellant.

No. 11-35729
DC No.
2:08-cv-1067JCC

OPINION

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CONSERVATION NORTHWEST V . SHERMAN
Appeal from the United States District Court
for the Western District of Washington
John C. Coughenour, District Judge, Presiding
Argued and Submitted
October 9, 2012—Seattle, Washington
Filed April 25, 2013

Before: Alex Kozinski, Chief Judge, A. Wallace Tashima
and Milan D. Smith, Jr., Circuit Judges.
Opinion by Judge Tashima

SUMMARY*

Environmental Law
The panel reversed the district court’s order approving a
consent decree arising from a settlement between
environmental groups and federal agencies concerning
changes to the Survey and Manage Standard of the Northwest
Forest Plan.
The panel held that it was an abuse of discretion for the
district court to approve the consent decree in its current
form. The panel held that a district court abuses its discretion
when it enters a consent decree that permanently and
substantially amends an agency rule that would have
*

This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.

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otherwise been subject to statutory rulemaking procedures.
The panel concluded that because the consent decree allowed
for substantial, permanent amendments to the Survey and
Manage Standard of the Northwest Forest Plan, it
impermissibly conflicted with laws governing the process for
such amendments. Finally, the panel held that the issue of
whether the Oregon and California Railroad and Coos Bay
Wagon Road Grants Land Act precluded application of the
Survey and Manage Standard to certain timberlands was not
adequately raised below, and thereby waived.

COUNSEL
Scott W. Horngren (argued), American Forest Resource
Council; Shay S. Scott, Haglund Kelley Jones & Wilder LLP,
Portland, Oregon, for Intervenor-Defendant-Appellant.
John L. Smeltzer (argued), Attorney, Ignacia S. Moreno,
Assistant Attorney General, and David C. Shilton, Attorney,
Environmental & Natural Resources Division, United States
Department of Justice, Washington, D.C., for DefendantsAppellees.
Peter M.K. Frost (argued), Western Environmental Law
Center, Eugene, Oregon, for Plaintiffs-Appellees.

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OPINION

TASHIMA, Circuit Judge:
We must decide whether a district court may approve
resolution of litigation involving a federal agency through a
consent decree, which substantially and permanently amends
regulations that the agency could only otherwise amend by
complying with statutory rulemaking procedures.
Conservation Northwest and a coalition of other
environmental groups (“Plaintiffs”) sued the Bureau of Land
Management (“BLM”), Forest Service, and Fish and Wildlife
Service (collectively, the “Agencies”), challenging changes
to the Survey and Manage Standard (“Survey and Manage”
or the “Standard”) of the Northwest Forest Plan (“NFP”).
Plaintiffs and the Agencies (together, “Appellees”) negotiated
a settlement which the district court approved and entered in
the form of a consent decree. Defendant-Intervenor D.R.
Johnson Lumber Company (“D.R. Johnson”) appeals from
the district court’s approval of the consent decree contending
that it was an abuse of discretion because (1) the consent
decree conflicts with applicable law by amending Survey and
Manage without following applicable procedural
requirements, and (2) its application to lands subject to the
Oregon and California Railroad and Coos Bay Wagon Road
Grants Land Act (“O & C Act”) violates the terms of that
Act. We have jurisdiction under 28 U.S.C. § 1291. We
conclude that D.R. Johnson’s first argument is meritorious,
but that its second argument was waived. Accordingly, we
reverse the district court.

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I. Factual and Procedural Background
This is another case in the extensive and growing
litigation saga of the NFP. See, e.g., Conservation Nw. v.
Rey, 674 F. Supp. 2d 1232, 1236–41 (W.D. Wash. 2009);
Klamath Siskiyou Wildlands Ctr. v. Boody, 468 F.3d 549 (9th
Cir. 2006); Nw. Ecosystem Alliance v. Rey, 380 F. Supp. 2d
1175, 1181–84 (W.D. Wash. 2005) (“NEA”); Seattle Audubon
Soc’y v. Lyons, 871 F. Supp. 1291, 1300–02 (W.D. Wash.
1994), aff’d, 80 F.3d 1401 (9th Cir. 1996). The NFP itself
was the product of extensive litigation and political
controversy in the 1990s surrounding the health of the old
growth forests of the Pacific Northwest, it was intended as “a
truce between conservationists and logging concerns.”
Conservation Nw., 674 F. Supp. 2d at 1236–37. It is intended
to serve the twin goals of protecting the long-term ecological
health of the forests and providing for sustainable timber
production, and so requires a “balancing act between
commercial use and conservation.” Id. at 1238.
The NFP applies to approximately 24.5 million acres of
federal land between San Francisco and the Canadian border,
and divides that land into “Reserves,” “Adaptive
Management” areas, and “Matrix” areas. Most commercial
logging takes place in “Matrix” areas. The Agencies’
management of these lands is also governed by federal
statutes including the National Environmental Policy Act
(“NEPA”), the National Forest Management Act (“NFMA”),
the Endangered Species Act (“ESA”), and the Federal Land
Policy Management Act (“FLPMA”). Approximately ten
percent of NFP land is also subject to the O & C Act.
Survey and Manage is one part of the NFP. It was
adopted to assist the Agencies in assessing the impact of

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logging on approximately 400 little-known but ecologically
crucial species.1 The Standard requires the Agencies to
manage known sites where these species are found, conduct
surveys for their presence prior to ground-disturbing
activities, locate high priority sites for hard-to-find species,
and conduct general regional surveys to learn more about the
least-known species.
Based on their experience of the cost and complexity of
implementing Survey and Manage during its first several
years, the Agencies sought to amend the Standard in 2001.
This prompted resistance from both commercial logging and
conservation interests. See Douglas Timber Operators v.
Rey, No. 01-63788-AA (D. Or. 2001). That litigation ended
with a settlement in which the Agencies agreed to go back to
the drawing board to consider eliminating the Standard in its
entirety. See id.
In 2004, the Agencies issued another environmental
impact statement (“EIS”) and accompanying record of
decision (“ROD”), this time opting to eliminate Survey and
Manage. NEA, 380 F. Supp. 2d at 1183. This action again
sparked litigation, and in NEA the court found six violations
of NEPA, set aside the 2004 ROD, reinstated the 2001 ROD,
and enjoined authorization of logging on projects that were
not in compliance with that earlier ROD. NEA v. Rey,
2006 WL 44361, at *9 (W.D. Wash. Jan. 9, 2006).

1

This list includes fungi, lichens, bryophytes, vascular plants, mollusks,
amphibians, arthropods, and one mammal. “Although charismatic
megafauna they are not,” these organisms “are essential for the health of
forests.” Conservation Nw., 674 F. Supp. 2d at 1238 n.5.

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In 2001, the Agencies also attempted to downgrade and
then remove the red tree vole from Survey and Manage
without using formal amendment procedures mandated by
FLPMA. Klamath Siskiyou Wildlands Ctr. v. Boody,
468 F.3d 549, 553, 562–63 (9th Cir. 2006). In Boody, we
concluded that the BLM had impermissibly “changed the
terms and conditions of [Survey and Manage] without
complying with [the procedural requirements of FLPMA].”
Id. at 556.
In 2007, the Agencies issued their Final Supplemental
EIS and accompanying ROD (“2007 ROD”). In these
documents, the Agencies again opted to eliminate Survey and
Manage. Conservation Nw., 674 F. Supp. 2d at 1240. The
present litigation ensued when Plaintiffs challenged this
action, alleging violations of NEPA, NFMA, FLPMA, and
the ESA. Id. at 1240–41. D.R. Johnson intervened as a
defendant. Id. at 1241. Plaintiffs moved for partial summary
judgment on their NEPA claims, and D.R. Johnson and the
Agencies opposed that motion and cross-moved for summary
judgment themselves. Id.
After comprehensive analysis of Plaintiffs’ NEPA claims,
the district court found four NEPA violations. Id. at
1244–53. Noting the “highly complex issues at stake, and the
procedural posture” after partial summary judgment, the court
declined to decide on a remedy at that time. Id. at 1257.
After lengthy negotiations, the Agencies and Plaintiffs
filed a proposed settlement agreement detailing how Survey
and Manage would operate going forward. The settlement
includes a lengthy description of “New Exemptions from Predisturbance Surveys,” and a list of “Species and Category
Assignment[s],” including an explanation of new

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management requirements for certain species. D.R. Johnson
objected that the settlement modified the Standard without
complying with statutorily mandated public-participation
procedures, but the district court rejected this contention and
entered the settlement as a consent decree. The court cited
Turtle Island Restoration Network v. U.S. Department of
Commerce, 834 F. Supp. 2d 1004 (D. Haw. 2011), explaining
that its entry of the consent decree “invoke[d] a judicial act,
not an agency act,” and that the general rules applicable to
agencies were therefore not relevant. D.R. Johnson timely
appeals.
II. Discussion
D.R. Johnson contends that the district court abused its
discretion by entering a consent decree that effectively
amended Survey and Manage without going through
procedures required by NEPA, FLPMA, NFMA, and their
implementing regulations. Appellees respond that, because
the consent decree was a “judicial act,” procedural
requirements that would otherwise govern agency action are
inapplicable.2 D.R. Johnson further argues that application of
the consent decree to lands covered by the O & C Act would

2

Appellees also argue that D.R. Johnson should be judicially estopped
from challenging the consent decree on the ground that it was party to the
stipulated modifications to the injunction issued in NEA. W e disagree.
D.R. Johnson did not take an explicit position with regards to the proper
scope of the district court’s power to modify its injunction in NEA, so
there are no grounds for estopping D.R. Johnson from making its
argument now. See Reed Elsevier, Inc. v. Muchnik, 130 S. Ct. 1237, 1249
(2010) (quoting New Hampshire v. Maine, 532 U.S. 742, 750, 751
(2001)).

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violate that Act.3 Appellees reply that D.R. Johnson waived
this argument by failing to raise it adequately before the
district court.
We review a district court’s approval of a consent decree
for abuse of discretion. Turtle Island Restoration Network v.
U.S. Dep’t of Commerce, 672 F.3d 1160, 1165 (9th Cir.
2012). “Abuse of discretion” means that a decision rests on
a clearly erroneous finding of material fact or is the result of
a failure to apply the correct law. Id.; see also United States
v. Hinkson, 585 F.3d 1247, 1251 (9th Cir. 2009) (en banc).
We review conclusions of law de novo. Husain v. Olympic
Airways, 316 F.3d 829, 835 (9th Cir. 2002).
A. Procedural Requirements and Consent Decrees
A consent decree is a hybrid; it is both a settlement and an
injunction. See United States v. ITT Cont’l Baking Co.,
420 U.S. 223, 237 n.10 (1975) (“Consent decrees and orders
have attributes both of contracts and of judicial decrees or . . .
administrative orders.”). This “dual character . . . has resulted
in different treatment for different purposes.” Local No. 93,
Int’l Ass’n of Firefighters v. City of Cleveland, 478 U.S. 501,
519 (1986). Although a consent decree typically represents
“an amalgam of delicate balancing, gross approximations,
and rough justice,” and “need not impose all the obligations
authorized by law,” United States v. Oregon, 913 F.2d 576,
581 (9th Cir. 1990) (internal quotation marks omitted), a
district court may not approve a consent decree that “conflicts

3

D.R. Johnson also urges us to rule on the correctness of one sentence
of the district court’s order granting partial summary judgment. Because
we reverse this order on other grounds, we need not address this argument.

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with or violates” an applicable statute, Local 93, 478 U.S. at
526.
In Boody, we adopted a strict interpretation of when the
BLM must follow formal procedures in the context of
amending Survey and Manage. 468 F.3d at 556. We
explained that under FLPMA, “if BLM wishes to change a
resource management plan, it can only do so by formally
amending the plan pursuant to 43 C.F.R. § 1610.5-5.” Id. In
that case, the BLM had first issued a memorandum
downgrading the Survey and Manage classification of the red
tree vole from Category C to Category D, and subsequently
issued a second memorandum removing the vole’s Survey
and Manage designation entirely. Id. at 553. We rejected
BLM’s argument that this decision to downgrade the vole’s
status fit within the scope of simple plan “maintenance,”
which could proceed pursuant to § 1610.5-4, and without
formal amendment. Id. at 556–58. We found that the agency
action should have followed the process described in
§ 1610.5-5, and went on to hold that “[b]ecause the [changes
at issue] trigger[ed] the § 1610.5-5 requirements under
FLPMA, they also trigger[ed] the NEPA requirements under
40 C.F.R. § 1502.9(c)(1)(i).” Id. at 561. We explained that
enforcement of a low threshold to trigger formal amendment
procedures
ensure[s] that whenever resource management
plans are changed in any meaningful way, the
changes must be made via amendment (i.e.,
supported by scientific environmental analysis
and public disclosure). This is consistent with
FLPMA’s requirement that BLM ensure the
views of the general public and third-party

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participation are adequately incorporated into
the land planning process.
Id. at 557 (internal quotation marks omitted). We stated that
the “BLM must amend a management plan when an action is
proposed that changes either the scope of resource uses or the
terms, conditions and decisions of the plan.” Id. at 556
(internal quotation marks omitted). While Boody did not
involve changes enacted through a consent decree, it
nonetheless informs our understanding of the procedural
issues in the case at bench.
Our decision in United States v. Carpenter, 526 F.3d 1237
(9th Cir. 2008), is also instructive. In Carpenter, we held that
the Attorney General’s decision to settle litigation “without
complying with the procedural mechanisms . . . set forth in
the FLPMA” was reviewable. Id. at 1241–42. That we
refrained from passing on the merits of the Attorney
General’s action in that case does not undermine the
conclusion that we are bound to consider procedural
requirements in the context of an agency’s voluntary
resolution of litigation. See id. at 1242. Nor does the fact
that Carpenter involved a settlement as opposed to a consent
decree render its holding inapposite. See Oregon, 913 F.2d
at 580 (“A consent decree is essentially a settlement
agreement subject to continued judicial policing.”) (internal
quotation marks omitted). That consent decrees involve an
additional layer of “judicial action” does not mean that we
must ignore the many ways in which they resemble
settlements. See Local 93, 478 U.S. at 519.
Our recent decision in Turtle Island lends further support
to the conclusion that procedural requirements remain
relevant in the context of consent decrees. In that case, the

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National Marine Fisheries Service had amended a Fishery
Management Plan to remove certain set limits and increase
the annual incidental take limit on loggerhead sea turtles.
672 F.3d at 1163. Environmental plaintiffs challenged the
changes to the rule, and eventually entered an agreement with
the defendants to vacate those portions of the amendment that
raised the take limit on loggerhead turtles while the agency
undertook further action regarding that limit. Id. at 1163–64.
The Hawaii Longline Association, which had intervened as a
defendant, challenged the consent decree on the ground that
it violated “federal law by allowing the National Marine
Fisheries Service to change duly promulgated rules without
following [applicable] procedural rulemaking requirements.”
Id. at 1162. We observed that the challenged consent decree
“merely vacated a portion of a regulation and temporarily
reinstated the relevant prior portion.” Id. at 1166. That the
decree “merely temporarily restore[d] the status quo ante
pending new agency action and [did] not promulgate a new
substantive rule” was central to our decision to resolve that
case on the “narrower” ground that the relevant statute did not
preclude the use of consent decrees in the agencies’
resolution of litigation. Id. at 1167. We did recognize,
however, the existence of a “broader issue regarding
applicability of statutory rulemaking procedures to judicial
acts in general” that we found unnecessary to address directly
in that case. Id. It follows that where a consent decree does
promulgate a new substantive rule, or where the changes
wrought by the decree are permanent rather than temporary,
the decree may run afoul of statutory rulemaking procedures
even though it is in form a “judicial act.” Id. We therefore
hold that a district court abuses its discretion when it enters
a consent decree that permanently and substantially amends
an agency rule that would have otherwise been subject to
statutory rulemaking procedures.

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B. The Specific Consent Decree in This Case
We now turn to an analysis of the consent decree before
us in this case. After Boody, it is indisputable that the
Agencies would have had to go through formal procedures if
they had sought to implement the changes to Survey and
Manage contained in the consent decree on their own. The
decree includes changes to species classifications and
establishes new exemptions from pre-disturbance surveys; it
does “nothing short of amend” Survey and Manage. See
Boody, 468 F.3d at 556–57 (internal quotation marks
omitted).
This consent decree also goes further than the one that we
approved in Turtle. 672 F.3d at 1164. As a result, “the
practical effect of the district court’s order [there was] not to
affect the [challenged] [r]ule . . . except to reduce the
incidental take limit for loggerhead turtles back to the preexisting 2004 limits.” Id. The consent decree was simply a
stop-gap measure while the agencies amended their
regulations through existing administrative procedures. Id. at
1167 (“[T]he Consent Decree merely temporarily restores the
status quo ante pending new agency action . . . .” (emphasis
added)).
By contrast, the consent decree in this case sets the rules
for Survey and Manage unless and until the Agencies decide
to conduct further analysis and decision making. If the
Agencies are satisfied with the version of the Standard as
amended by the consent decree, they could simply let it stand
indefinitely.
Appellees argue that this is not a problem because the
compromise reached in the consent decree represents the

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implementation of those portions of the 2007 ROD that
survived the district court’s order granting summary
judgment on Plaintiffs’ NEPA claims. Appellees argue
further that because each provision of the consent decree was
contained within the 2007 ROD, which had undergone
NFMA and FLPMA amendment proceedings, with notice and
comment and consideration of alternatives, the provisions of
the consent decree should be approved as the result of the
amendment process. Finally, they suggest that because the
changes worked in the consent decree are a “lesser included”
subset of the 2007 ROD’s proposed alternative of eliminating
Survey and Manage altogether, it was permissible for the
district court to approve them.
While these arguments have some intuitive appeal, we
must reject them. The district court concluded that the
Agencies’ process as a whole had violated NEPA by, among
other things, failing to include an alternative that truly
“depict[ed] accurately the Agencies’ present course of
action.” Conservation Nw., 674 F. Supp. 2d at 1244–47
(internal quotation marks omitted). Analysis of the “noaction alternative” is at the heart of the NEPA process; thus,
failure to provide a valid one casts a shadow over the process
as a whole. Id. at 1244. This failure not only rendered the
process defective under NEPA, but also infected the public
notice and comment prescribed by NFMA and FLPMA,
because the public should have been afforded an opportunity
to comment on all alternatives that the Agencies were
required by law to consider. See Boody, 468 F.3d at 556
(views of public must be adequately incorporated into
process).
Appellees’ “lesser included” argument is similarly
unconvincing. Under Boody, any substantial change to

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Survey and Manage triggers procedural requirements,
whether the change would reduce coverage to a “lesser
included” version of the standard’s protections, as was the
case in Boody, or scale back from a total repeal of Survey and
Manage, as Appellees suggest is permissible here. 468 F.3d
at 556–58; see also City of N.Y. v. Clinton, 985 F. Supp. 168,
178–79 (D.D.C. 1998), aff’d, 524 U.S. 417 (1998) (“[T]he
laws that resulted . . . were different from those consented to
. . . . There is no way of knowing whether those laws, in their
truncated form, would have received the requisite support
. . . .” ).
Because the consent decree in this case allowed the
Agencies effectively to promulgate a substantial and
permanent amendment to Survey and Manage without having
followed statutorily required procedures, it was improper.
C. The O & C Act
D.R. Johnson also objects to the consent decree on the
basis that the O & C Act precludes application of Survey and
Manage to O & C timberlands. Appellees respond that D.R.
Johnson waived this issue by failing to raise it adequately
below.
“We apply a general rule against entertaining arguments
on appeal that were not presented or developed before the
district court.” In re Mercury Interactive Corp. Sec. Litig.,
618 F.3d 988, 992 (9th Cir. 2010) (internal quotation marks
omitted). “This principle accords to the district court the
opportunity to reconsider its rulings and correct its errors.”
Id. (internal quotation marks omitted). This rule also ensures
that issues raised for the first time on appeal are not decided
where “there may be facts relevant to the issue which were

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not developed in the record.” Bolker v. Commissioner,
760 F.2d 1039, 1042 (9th Cir. 1985).
In the proceedings below, D.R. Johnson only mentioned
its theory that the O & C Act precluded application of Survey
and Manage to O & C lands in its cross-motion for summary
judgment, as part of its argument about the appropriate
remedy. The argument was buried in the middle of a section
entitled “A Permanent Injunction is not Warranted,” as part
of a broader argument about weighing the equities. The
district court never ruled on that issue when it granted
Plaintiffs’ partial motion for summary judgment, and D.R.
Johnson failed to re-raise its argument when it opposed
Appellees proposed consent decree. As a result, the order
from which D.R. Johnson appeals contains no discussion of
this argument. We therefore conclude that D.R. Johnson
failed properly to raise the issue below; consequently, it is
waived.
III. Conclusion
Because the consent decree allows for substantial,
permanent amendments to Survey and Manage, it
impermissibly conflicts with laws governing the process for
such amendments. It was therefore an abuse of discretion for
the district court to approve it in its current form. We reverse
and remand for further proceedings consistent with this
opinion.
REVERSED and REMANDED.

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