Kentuckians for the Commonwealth et al v. United States Army Corps of Engineers et al
Filing
81
MEMORANDUM AND OPINION by Senior Judge Thomas B. Russell on 9/18/2013; re DN 73 & 80 cc:counsel (KJA)
UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF KENTUCKY
LOUISVILLE DIVISION
CASE NO. 3:12-CV-00682-TBR
KENTUCKIANS FOR THE
COMMONWEALTH, et al.,
PLAINTIFFS,
v.
U.S. ARMY CORPS OF ENGINEERS, et al.,
DEFENDANTS.
MEMORANDUM OPINION
Plaintiffs Kentuckians for the Commonwealth and Sierra Club have filed a Notice
of Appeal (Docket No. 72) from this Court’s August 23, 2013 Memorandum Opinion
(Docket No. 70) and Order and Judgment (Docket No. 71). The Court upheld the U.S.
Army Corps of Engineers’ July 26, 2012 decision to issue a § 404 permit under the Clean
Water Act, 33 U.S.C. § 1344, to Leeco, Inc., an intervenor in the action. The permit
authorizes Leeco to discharge dredged or fill material into tributaries of Stacy Branch and
Yellow Creek of Carr Creek, which are “waters of the United States” under the Clean
Water Act and accompanying regulations. These activities are part of Leeco’s nearby
surface coal mining operations.
The Court’s Memorandum Opinion of August 23, 2013, denied Plaintiffs’
motions for summary judgment and granted Defendants’ motions for summary judgment
in part (Docket No. 70). It determined that the Corps adequately analyzed the issues
before it prior to issuing the permit and that the Corps did not act arbitrarily and/or
capriciously in issuing the permit (Docket No. 70 at 37). The Court rejected Plaintiffs’
argument that the Corps violated the National Environmental Policy Act (NEPA) and the
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Clean Water Act (CWA) by not considering evidence of risk to public health from coal
mining activities. The Court also rejected Plaintiffs’ argument that the Corps errantly
determined that the destruction of streams at the mine site will not significantly degrade
waters of the United States.
Plaintiffs moved for an Injunction Pending Appeal under Federal Rule of Civil
Procedure 62(c) to direct the U.S. Army Corps of Engineers to suspend Leeco’s § 404
permit and prohibit Leeco from dredging or filling waters of the United States while
Plaintiffs’ appeal is pending (Docket No. 73). On August 30, 2013, the Court entered a
temporary injunction directing the Army Corps of Engineers to temporarily suspend
Leeco’s § 404 Permit LRL-2007-217 (Docket No. 74). The Court now considers whether
to extend this injunction. For the reasons that follow, Plaintiffs’ motion is GRANTED.
DISCUSSION
I. Plaintiffs’ Motion for an Injunction Pending Appeal should be granted
based on the required balancing test.
Federal Rule of Civil Procedure 62(c) authorizes this Court to grant an injunction
during the pendency of an appeal.1 This is an “extraordinary remedy” that “should be
granted sparingly.” Roghan v. Block, 590 F. Supp. 150, 152 (W.D. Mich. 1984).
Four factors govern the issuance of injunctions pending appeal: (1) the likelihood
that the party seeking the injunction will prevail on the merits of the appeal; (2) the
likelihood that the moving party will be irreparably harmed absent an injunction; (3) the
prospect that others will be harmed if the court grants the injunction; and (4) the public
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“When an appeal is taken from an interlocutory or final judgment granting, dissolving, or denying an
injunction, the court in its discretion may suspend, modify, restore, or grant an injunction during the
pendency of the appeal upon such terms as to bond or otherwise as it considers proper from the security of
the rights of the adverse party.” Fed. R. Civ. P. 62(c).
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interest in granting the injunction. Service Emps. Int’l Union Local 1 v. Husted, 698 F.3d
341 (6th Cir. 2012) (citing Mich. Coal. Of Radioactive Material Users, Inc. v.
Griepentrog, 945 F.2d 150, 153 (6th Cir. 1991). The four factors “are not prerequisites
that must be met, but are interrelated considerations that must be balanced together.” Id.,
citing Mich. Coal. of Radioactive Material Users, Inc. v. Griepentrog, 945 F.2d 150, 153
(6th Cir. 1991).2
The strength of the likelihood of success on the merits that movants must
demonstrate is “inversely proportional to the amount of irreparable harm that will be
suffered” if the injunction does not issue. Baker v. Adams County/Ohio Valley School
Bd., 310 F.3d 927, 928 (6th Cir. 2002). To justify an injunction, the movant must
demonstrate “at least serious questions going to the merits and “irreparable harm that
decidedly outweighs the harm that will be inflicted on others” if an injunction is granted.
Id. (citing In re DeLorean Motor Co., 755 F.2d 1223, 1229 (6th Cir. 1985)).
a.
Plaintiffs have not established a sufficient likelihood of success on the merits.
Plaintiffs argue that there are “serious questions going to the merits” on appeal
that are sufficient to satisfy the first factor (Docket No. 73-2 at 4). “The first factor is,
conceptually, the most difficult to apply. Logic dictates that a court will seldom deny an
injunction, then turn around and grant one pending appeal, finding, in part, that the party
seeking injunctive relief is likely to prevail on appeal, i.e. that it is likely that the court
erred in denying injunctive relief.” Dayton Christian Schools v. Ohio Civil Rights
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Defendant urges the Court to abandon the Husted standard and instead adopt the U.S. Supreme Court’s
position as articulated in Winter v. Nat. Res. Defense Council, 555 U.S. 7 (2008). Winter held that movants
seeking a preliminary injunction must establish each element independently. Therefore, the movant’s
failure to establish any one element requires the Court to deny injunctive relief, regardless of the weight of
the other factors. However, Husted confirmed the validity of the Sixth Circuit’s pre-Winter case law four
years after Winter itself. Accordingly, this Court will apply Husted.
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Com’n, 604 F. Supp. 101, 102 (S.D. Ohio 1984). Acknowledging this logical dilemma,
the Court remains convinced that appellate review will confirm the soundness of its
August 23, 2013 decision. Furthermore, Plaintiffs have pointed to no relevant law that
was not considered and applied by the Court in its opinion. Accordingly, Plaintiffs have
not shown a strong or substantial likelihood of success on the merits.
Notwithstanding this fact, the Court will discuss the remaining factors to
determine if they nevertheless counsel toward granting relief during the appeal’s
pendency. “A number of courts have held that when equitable factors strongly favor
interim relief, the court is not required to find that ultimate success by the movant is a
mathematical probability’ and ‘may grant a stay even though its own approach may be
contrary to the movant’s view of the merits.’” A & B Steel Shearing & Processing, Inc.
v. U.S., 174 F.R.D. 65 (E.D. Mich. 1997) (citing Thiry v. Carlson, 891 F.Supp. 563, 466
(D. Kan. 1995)). The movants need not demonstrate that it is more likely than not that
they will succeed on appeal. Should the remaining three factors strongly favor granting
interim relief, a court may grant an injunction pending appeal if the movant has made a
substantial case on the merits. Dayton Christian Schools, 604 F. Supp. at 103. Further,
much of the decision and findings of the Court were based on the deferential standard of
review mandated on some claims. In short, the opinion is not a total de novo review.
Subsequent courts court could apply the standard in a more or less deferential manner and
still be compliant with it.
b.
Plaintiffs will be irreparably harmed if denied interim relief.
The second factor queries whether the movant will be irreparably harmed absent
interim relief. This factor directs in favor of granting the injunction. The Court’s August
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23, 2013 Memorandum Opinion allows Leeco to immediately proceed with its activities,
including construction of a foundation for the planned valley fill (Docket No. 72-3 at 6).
Leeco remains free to engage in other mining and stream-filling activities that may affect
the three miles of tributary streams to Stacy Branch and Yellow Creek pursuant to its §
404 permit (Id.).
The Court finds that Plaintiffs will be irreparably harmed if an injunction is not
granted for the appeal’s pendency. Not only may Leeco’s activities disturb Plaintiffs’
members who work, live, and recreate near these sites, they may also destroy the streams
themselves. “[T]here is no adequate remedy at law to compensate the public for the harm
caused by the disposal of fill material into waters of the United States or in its wetlands.”
U.S. v. Malibu Beach, Inc., 711 F. Supp. 1301, 1313 (D.N.J. 1989). “Environmental
injury, by its nature, can seldom be adequately remedied by money damages and is often
permanent or at least of long duration, i.e., irreparable.” Amoco Prod. Co. v. Vill. of
Gambell, Alaska, 480 U.S. 531, 545 (1987).
Defendants point to Leeco’s required compensatory mitigation payment to the
Kentucky Department of Fish and Wildlife Resources Stream and Mitigation Trust Fund
and other mitigation projects, arguing that they alleviate any harm to Plaintiffs (Docket
No. 76 at 5-6). However, the injury in question is not only to the environment generally,
but to specific streams and populations in precise locations. Because environmental
injury is sufficiently likely, the balance of harms favors the issuance of an injunction to
protect the environment.
Leeco has offered to restrict its use of the § 404 permit to approximately 2,900
feet of waters pending appeal, reducing the amount of mining and stream impacts
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(Docket No. 77 at 14-15). Leeco represents that such limited filling would “prevent[]
substantial economic harm to itself and others” (Id. at 14). However, this proposal does
not prevent permanent damage to the waters at issue—it only limits it. As discussed
above, the enduring and irreparable harms that Plaintiffs would suffer do not allow for
such compromise.
c.
Plaintiffs’ harm outweighs that of Defendants.
Third, the Court considers the harm suffered by defendants if the injunction is
issued. The United States asserts no harm (Docket No. 76 at 6).
Leeco argues that the issuance of an injunction would cause it to incur substantial
economic harm. If its Section 404 permit is suspended, it will be forced to either refrain
from any mining at the Stacy Branch site altogether, or, if it does conduct such mining, to
incur unrecoverable expenses in avoiding disturbance to jurisdictional streams (Docket
No. 77 at 14). Leeco further argues that an injunction would reduce both the amount of
wages and taxes that it would otherwise pay (Id.). It says that an injunction would lessen
the mine’s value, as the company would permanently lose access to much of the on-site
coal and that the mine’s life would be reduced (Id.). Leeco points to costs it would incur
from idling and restarting operations and from fulfilling its sale commitments with more
expensive coal. The company finally argues that an injunction would diminish its ability
to respond to a potential rise in the coal market (Id).
Such economic loss to Leeco, either real or speculative, and the resultant effect on
its employees is certainly regrettable. However, “[p]otential monetary damage does not
constitute irreparable harm.” Baker v. Adams County/Ohio Valley School Bd., 310 F.3d
927, 930 (6th Cir. 2002). “Money can be earned, lost, and earned again; a valley once
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filled is gone.” Ohio Valley Envtl. Coal. V. U.S. Army Corps of Eng’rs, 528 F.Supp.2d
625, 632 (S.W.D. Va. 2007). Accordingly, the harm suffered by Leeco is outweighed by
that of the Plaintiffs.
d.
The public has a strong interest in maintaining a balance between economic
growth and environmental protection.
Finally, the Court must assess the public interest in the injunction. “There is
frequently a tension between environmental protection and immediate economic gain.”
Ohio Valley Envtl. Coal., 528 F.Supp.2d 625, 633. In legislation including the Clean
Water Act (CWA) and the National Environmental Policy Act (NEPA), Congress seeks
to preserve a balance between these two competing goods. Among Congress’s goals in
drafting NEPA was to “declare a national policy which will encourage productive and
enjoyable harmony between man and his environment.” 42 U.S.C. § 4321. The relevant
CWA provisions were designed to prevent dredged or fill material from causing an
unacceptable environmental impact. See Ohio Valley Envtl. Coal. V. U.S. Army Corps of
Eng., 479 F.Supp.2d 607, 623-24 (S.D.W. Va. 2007). Both NEPA and the CWA contain
various mechanisms to safeguard environmental resources and ensure that environmental
concerns are weighed. Ohio Valley Envtl. Coal., 528 F.Supp.2d at 633.
The public has a robust interest in the integrity of the permitting process, which
ensures that congressional objectives are enforced. Id. Suspending Leeco’s projects
during the appeal’s pendency ensures that they will withstand the requisite scrutiny
before streams are permanently harmed. Accordingly, such an injunction comports with
the public interest. See S. Fork Band Council of W. Shoshone of Nevada v. U.S. Dep’t of
Interior, 588 F.3d 718, 728 (9th Cir. 2009) (“Congress’s determination in enacting NEPA
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was that the public interest requires careful consideration of environmental impacts
before major federal projects may go forward. Suspending a project until that
consideration has occurred thus comports with the public interest.”).
Leeco argues that the public interest favors allowing activities under validly
issued permits, including coal production (Docket No. 77 at 15). This endeavor may well
be a worthy one, but it is nonetheless subject to the congressionally mandated balance
discussed above. Because the project could cause permanent damage to the streams in
question, the Court finds that the balance of public interest weighs toward Plaintiffs.
II. Leeco’s request for bond is denied.
Leeco estimates that over fifteen months, the average time to resolve an appeal in
the Sixth Circuit, it would incur over $1 million in unrecoverable costs (Docket No. 77 at
16). On this ground, it argues that the Sierra Club should be required to post an initial
bond of at least $1 million, plus potential increases for Leeco’s additional expenses and
lost revenues (Docket No. 77 at 17). Of course, Leeco was facing this same scenario if
the Court had found for Plaintiffs in this action.
Although one seeking a preliminary injunction or temporary restraining order is
generally required to post a bond as security before the injunction will issue, Rule 65(c) 3
of the Federal Rules of Civil Procedure affords the Court “wide discretion in the matter
of requiring security.” National Resources Defense Council v. Morton, 337 F. Supp. 167,
168 (D.D.C. 1971). A well-established exception to Rule 65(c)’s bond provision exists
where “the purposes of the security bond conflict with those of the Act” at issue. See Div.
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“No restraining order or preliminary injunction shall issue except upon the giving of security by the
applicant, in such sum as the court deems proper, for the payment of such costs and damages as may be
incurred or suffered by any part who is found to have been wrongfully enjoined or restrained. No such
security shall be required of the United States or of an officer or agency thereof.” Fed. R. Civ. Proc. 65(c).
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No. 1, Detroit, Broth. of Locomotive Eng’rs v. Consol. Rail Corp., 844 F.2d 1218, 1227.
“Moreover, special precautions to ensure access to the courts must be taken where
Congress has provided for private enforcement of a statute.” People of State of Cal. Ex
rel. Van De Kamp v. Tahoe Regional Planning Agency, 766 F.2d 1319, 1325-26 (citing
Friends of the Earth v. Brinegar, 518 F.2d 322, 323 (9th Cir. 1975) and Morton, 337
F.Supp. at 168-69, both discussing NEPA). In the case at bar, Plaintiffs seek to vindicate
the public interest served by NEPA. Therefore, no bond is required.
Leeco argues that this case is distinguishable from others that have relaxed
bonding requirements for preliminary injunctions in NEPA cases. It differentiates the
case at bar from Natural Res. Def. Council v. Morton, 337 F. Supp. 167 (D.D.C. 1971),
where the plaintiffs were allowed to post only a nominal bond. Morton noted that “it
would be a mistake to treat a revenue loss to the Government the same as pecuniary
damage to a private party.” Id. at 169. Leeco argues that because an injunction would
cause a private party to incur loss, the Court should require a substantial bond (Docket
No. 77 at 17). However, this argument is not convincing. Although preliminary
injunctions based on NEPA are often directed at government authorities, such injunctions
no doubt affect the interests of private parties, including those with a financial stake in
the permit at issue. Consequently, Leeco’s argument fails.
Leeco further distinguishes Morton based on the contrasting financial positions of
its movants and Sierra Club. (Docket No. 77 at 17-19). Morton observed that to require
the movants, three nonprofit organizations, to post a substantial bond would effectually
preclude them from obtaining judicial review. 337 F.Supp. 167, 169. By contrast, it
argues that Sierra Club is a “big business” with highly paid executives, a tax exempt
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foundation, and substantial annual revenues (Docket No. 77 at 18). However, the Court
agrees with Plaintiffs that the availability of the public interest exception does not depend
upon a movant’s showing of need (Docket No. 79 at 13). Rather, the exception is
designed to facilitate private enforcement of public rights. Accordingly, no bond is
required.
CONCLUSION
Where environmental injury “is sufficiently likely . . . the balance of harms will
usually favor the issuance of an injunction to protect the environment.” Amoco Prod.
Co., 480 U.S. at 545.
injunction.
Accordingly, the equities balance in favor of granting an
Plaintiffs have demonstrated that they will be irreparably injured if no
injunction is granted and the streams are destroyed. Were the Court of Appeals to reverse
this Court and rule in favor of Plaintiffs, Plaintiffs could receive no full and fair remedy
for the harm they suffered in the interim.
Accordingly, the Court GRANTS Plaintiffs’ motion for injunctive relief. The
Court will issue an order directing the U.S. Army Corps of Engineers to suspend Leeco’s
§ 404 Permit LRL-2007-217 and enjoining Leeco from dredging or filling waters of the
United States under that permit for the pendency of Plaintiffs’ appeal.
September 18, 2013
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