State v. Bureau of Land Mgmt.
286 F. Supp. 3d 1054
N.D. Cal.2018Background
- BLM adopted the "Waste Prevention, Production Subject to Royalties, and Resource Conservation" final rule ("Waste Prevention Rule") in Nov. 2016 to reduce gas venting, flaring, and leaks; many provisions phased in through Jan. 17, 2018.
- Industry and several states challenged the Waste Prevention Rule in the District of Wyoming; that court denied preliminary relief and later stayed its cases after BLM issued an interim "Suspension Rule."
- The Suspension Rule (Dec. 2017) delayed or suspended many Waste Prevention Rule requirements for one year while BLM reviewed and contemplated rescission/revision.
- Plaintiffs (California, New Mexico, and conservation/tribal groups) sued in the Northern District of California seeking a preliminary injunction to enjoin enforcement of the Suspension Rule and restore the Waste Prevention Rule.
- Defendants moved to transfer venue to Wyoming; Plaintiffs moved for a preliminary injunction. The court denied transfer and granted the injunction, finding the Suspension Rule likely arbitrary and capricious, that plaintiffs showed irreparable environmental harm, and that equities/public interest favored relief.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Transfer of venue under 28 U.S.C. § 1404(a) | Transfer unnecessary; this suit challenges procedural defects in the Suspension Rule, distinct from Wyoming merits challenges | Transfer favored for efficiency and judicial familiarity with the Waste Prevention Rule | DENIED — plaintiffs' chosen forum entitled to deference; issues are substantively distinct and Wyoming stay obviates efficiency claim |
| Whether Suspension Rule is arbitrary and capricious (reasoned explanation) | BLM reversed prior factual conclusions without adequate record support or a detailed justification required by Fox Television | Suspension is a discrete, temporary policy change and BLM need not replicate full prior analysis | HELD LIKELY ARBITRARY — BLM failed to provide factual support for key new rationales (e.g., marginal wells, small operators, royalties) and did not give the detailed justification required when contradicting earlier findings |
| Adequacy of Regulatory Impact Analysis (RIA) | RIA contains inconsistent assumptions (treats benefits as delayed one year but cost savings as permanent), fails to account for partial compliance, and undercounts global methane costs | RIA reasonably focuses on U.S. impacts and made discretionary analytical judgments consistent with OMB guidance | HELD FLAWED — court finds serious inconsistencies inflating net benefits and undermining reasoned decisionmaking |
| Notice-and-comment / predetermination | Secretary limited scope of permissible comments on economic and burden issues that were central to the Suspension Rule, preventing meaningful public participation | Agency followed APA procedures, addressed many comments, and did not predetermine outcome | HELD INVALID PROCEDURALLY — BLM curtailed comment on matters integral to its stated rationales, so process was not meaningfully open-minded |
| Irreparable harm, balance of equities, public interest | Suspension will cause immediate, irreparable environmental and health harms from additional methane, VOCs, and hazardous air pollutants; monetary harms inadequate | Suspension saves industry and agency costs (~$110–114M) and avoids premature compliance burden | HELD FOR PLAINTIFFS — court finds emissions and health harms irreparable; economic savings are speculative/insufficient to outweigh environmental/public-interest harms |
Key Cases Cited
- Jones v. GNC Franchising, Inc., 211 F.3d 495 (9th Cir. 2000) (forum non conveniens / §1404(a) transfer factors)
- Winter v. Nat. Res. Def. Council, Inc., 555 U.S. 7 (2008) (standard for preliminary injunctions)
- F.C.C. v. Fox Television Stations, Inc., 556 U.S. 502 (2009) (agency changing course must give reasoned explanation; greater justification if new policy contradicts prior findings)
- Motor Vehicle Mfrs. Ass'n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29 (1983) (arbitrary and capricious review requires examination of relevant data and reasoned explanation)
- Nat'l Cable & Telecomms. Ass'n v. Brand X Internet Servs., 545 U.S. 967 (2005) (administrative deference and treatment of agency inconsistencies)
- Decker Coal Co. v. Commonwealth Edison Co., 805 F.2d 834 (9th Cir. 1986) (plaintiff's forum choice and burden to show inconvenience for transfer)
- Asarco, Inc. v. EPA, 616 F.2d 1153 (9th Cir. 1980) (limits on extra-record evidence in APA substantive review)
- Prometheus Radio Project v. F.C.C., 652 F.3d 431 (3d Cir. 2011) (meaningful notice-and-comment requires agency remain open-minded)
- Rural Cellular Ass'n v. F.C.C., 588 F.3d 1095 (D.C. Cir. 2009) (agency satisfies comment requirement if it compiles, considers, and responds to substantive comments)