claiming a harm similar to the one Plaintiffs assert in the instant case.
Plaintiffs cite numerous cases to support their position that they have standing to bring this suit. See Resources Ltd. v. Robertson, 35 F.3d 1300, 1302 (9th Cir. 1994) (challenging Forest Service's issuance of the Flathead National Forest Land and Resource Management Plan (Plan) and the forest-wide Environmental Impact Statement (EIS) for failing to follow NEPA requirements); Idaho Conservation League v. Mumma, 956 F.2d 1508 (9th Cir. 1992) (alleging procedural failure in the Environmental Impact Statement in violation of the National Environmental Policy Act (NEPA)); Fund for Animals v. Lujan, 962 F.2d 1391, 1394 (9th Cir. 1992) (alleging violation of NEPA and the Montana Environmental Policy Act by failing to prepare an environmental impact statement before adopting a plan to kill bison that leave Yellowstone National Park); Alaska Fish & Wildlife Federation and Outdoor Council v. Dunkle, 829 F.2d 933, 934-35 (9th Cir. 1987), cert. denied, 485 U.S. 988, 99 L. Ed. 2d 501, 108 S. Ct. 1290 (1988) (action claiming Fish & Wildlife Service failed to follow federal procedures before entering into an agreement regarding the hunting of migratory birds); Sierra Club v. Department of the Interior, 398 F. Supp. 284, 285-86 (N.D. Cal. 1975) (alleging Secretary of the Interior failed to satisfy his statutory and fiduciary duty to protect the affected lands from the surrounding logging operations). Although these cases generally involve plaintiffs who claim an injury to their use and enjoyment of the affected lands, all of these cases involve challenges to the government's compliance with environmental statutes, and none a challenge to the equal value determination.
On the other hand, Defendants cite case law supporting the position that when the challenge is to an agency's equal value determination, plaintiffs, like those in the instant case, lack standing. See Baca v. King, 92 F.3d 1031, 1037 (10th Cir. 1996) (grazing lessee had no standing to challenge equal value determination underlying land exchange); Northern Plains Resource Council v. Lujan, 874 F.2d 661, 668 (9th Cir. 1989) (holding that Plaintiffs "lack standing to appeal the [BLM's] equal valuation determination); Lodge Tower Condominium Ass'n v. Lodge Properties, Inc., 880 F. Supp. 1370, 1381 (D. Colo. 1995), aff'd, 85 F.3d 476 (10th Cir. 1996) ("Plaintiffs do not have standing to challenge the agency's equal value determination" because there was no causal connection between the injury alleged and the purported undervaluation.).
In the instant case, Plaintiffs challenge the BLM's alleged failure to comply with the FLPMA's equal value provisions. Plaintiffs' principal alleged injury is that their members will be unable to enjoy the selected and surrounding lands. This does not provide Plaintiffs with standing. As the applicable cases demonstrate, there is no causal connection between Plaintiffs' alleged injuries and the BLM's undervaluation. Although Plaintiffs may be able to assert this type of injury to challenge alleged noncompliance with environmental statutes or regulations, this same injury is insufficient to sustain a cause of action aimed at the manner in which the BLM has valued exchanged lands. As Gold Fields notes in its papers, "put simply, any loss in Plaintiff's [sic] enjoyment of those lands would be precisely the same whether they were valued at $ 1 or $ 1 million per acre ...."
Plaintiffs allege an environmental injury, yet challenge the BLM's compliance with a non-environmental statute. Essentially, they are attempting to satisfy the standing requirements through the "back door" by relying on case law that recognizes standing based on the same injury that they claim, but challenges an entirely different aspect of the law. Their attempt to establish standing in this manner is unavailing.
Plaintiffs additionally allege that because the selected lands were undervalued, the BLM is receiving less private land than it would if the BLM properly calculated the market value of the land. This allegation does not meet the standing requirements either. First, Plaintiffs' interest in any additional lands is not distinguishable from that of the general public. As was addressed by the Ninth Circuit in Northern Plains, "merely alleging injury to their status as taxpayers (i.e., fewer federal funds from the coal development would result in higher taxes for appellants) does not confer standing because it does not create an interest in favor of appellants distinguishable from that of the general public." Northern Plains, 874 F.2d at 669. Similarly in this case, Plaintiffs are alleging a general interest common to all members of the public in that they claim that the federal land being exchanged was not properly valued and thus the government is not receiving as much land as it would with a proper valuation. Essentially, Plaintiffs are attacking the way the government is spending its money, and this is insufficient to confer standing on them. See id. at 668.
Second, Plaintiffs' alleged loss of additional private inholdings cannot confer standing because it is speculative and not redressable by this Court. An order setting aside the BLM's equal value determination would not ensure access to any additional land. It is purely speculative to assume that an order by this Court would lead to the acquisition of more land. In fact, the process by which lands are exchanged is committed by statute to the BLM and the proponent of the exchange, not the judiciary. See Baca v. King, 92 F.3d 1031, 1037 (10th Cir. 1996) (lack of standing to challenge equal value determination based in part on fact that court could not order BLM to issue a new grazing lease to Plaintiff). Plaintiffs' alleged injury in loss of additional inholdings is too speculative to satisfy the redressability requirement and therefore insufficient to establish standing.
Based upon the above analysis, this Court holds that Plaintiffs do not have standing to attack the BLM's equal value determination, and thus do not have standing to bring this motion for preliminary injunction or this action. This action must therefore be dismissed; however, because the Court urged the parties at the oral hearing to focus on the merits of the motion rather than the procedural issue of standing, the Court additionally addresses in the alternative, the merits of Plaintiffs' motion for preliminary injunction.
C. Preliminary Injunction Analysis
1. Reasonable likelihood of success on the merits
As discussed above, Plaintiffs claim that the BLM's ROD is arbitrary, capricious and an abuse of discretion and thus this Court must "hold unlawful and set aside" the BLM's approval of the land exchange as required under Section 10(e) of the APA. Plaintiffs make two major attacks on the BLM's decision to approve the exchange. First, Plaintiffs claim that the agency's failure to consider the possibility that the selected lands could be most valuable for use as a landfill when determining the highest and best use of the selected lands and hence their market values was arbitrary and capricious. Secondly, the Plaintiffs challenge as arbitrary and capricious the failure of the BLM to consider whether the appraisal of the selected lands should be updated given the fact the appraisal of the selected lands was prepared in August 1994 and BLM's approval did not come until February 1996.
To apply the arbitrary and capricious standard of 5 U.S.C. § 706(2)(A) involves a judicial weighing of the federal agency's action on its merits. In Motor Vehicle Mfrs. Ass'n. v. State Farm Mutual Auto. Ins. Co., 463 U.S. 29, 43, 77 L. Ed. 2d 443, 103 S. Ct. 2856 (1983), the Supreme Court noted:
It would arbitrary and capricious if the agency has relied on factors which Congress has not intended it to consider, entirely failed to consider an important aspect of the problem, offered an explanation for its decision that runs counter to the evidence before the agency, or is so implausible that it could not be ascribed to a difference in view or the product of agency expertise. The reviewing court should not attempt to make up for such deficiencies; we may not supply a reasoned basis for the agency's action that the agency itself has not given.
This standard necessitates a judicial examination of the disputed decision's rationale and surrounding circumstances in order to carry out the "demand that courts ensure that agency decisions are founded on a reasoned evaluation 'of the relevant factors.'" Marsh v. Oregon Natural Resources Council, 490 U.S. 360, 378, 104 L. Ed. 2d 377, 109 S. Ct. 1851 (1989) (quoting Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 416, 28 L. Ed. 2d 136, 91 S. Ct. 814 (1971)).
The BLM decision is entitled to substantial deference and must be upheld if it rests on a rational basis. See Hopi Tribe v. Navajo Tribe, 46 F.3d 908, 914 (9th Cir.), cert. denied, 133 L. Ed. 2d 236, 116 S. Ct. 337 (1995) ("The standard is narrow and a court is not to substitute its judgment for that of the agency."); Nevada Land Action Ass'n v. United States Forest Service, 8 F.3d 713, 717 (9th Cir. 1993) ("An agency's interpretation of its own regulations controls unless it is 'plainly erroneous.'"); see also Northern Plains Resource Council v. Lujan, 874 F.2d 661, 665 (9th Cir. 1989) ("Where the review involves the interpretation of a regulation, the agency's interpretation of its own regulation is to be given controlling weight unless it is plainly erroneous or inconsistent with the regulation.").
In order to determine whether the BLM's act of approving the land exchange was arbitrary, capricious and an abuse of discretion, it is necessary to outline the applicable regulations that the BLM is required to comply with when approving such a land exchange. The Court must then look at the information available to the BLM at the time it made its decision and determine if based on this information and the surrounding circumstances, BLM's decision to approve the land exchange was arbitrary and capricious or in excess of its authority.
43 C.F.R. § 2200.0-4 provides that the Director of the BLM has the responsibility of carrying out the functions of the Secretary of the Interior under these regulations. One of the main requirements in order for a land exchange to be valid is that the "lands or interests to be exchanged shall be of equal value or equalized in accordance with the method set forth in 2201.6 of this part [cash equalization]. An exchange of land or interest shall be based on market value as determined by the Secretary through appraisal(s), through bargaining based on appraisal(s), or through arbitration. 43 C.F.R. § 2200.0-6(c). The main crux of the dispute in this action is whether the BLM's market value determination of the selected lands (obtained through reliance on the Nichols & Gaston appraisal) on which the BLM based its finding that the exchange was for equal value was arbitrary and capricious. To resolve this dispute, the Court must determine if the appraisal and subsequent appraisal report conformed to the requirements set forth in the regulations.
Section 206(d) of the FLPMA directs the Secretary to obtain and consider an appraisal of the affected lands' market value. The BLM commissioned an appraisal of the exchange lands in accordance with this section and to ensure that the lands were of equal value as required by Section 206. This appraisal was conducted by Nichols & Gaston, a firm recommended by BLM because its principal, John Nichols had almost 40 years of experience appraising property in California and clearly satisfied the appraiser qualification criteria set forth in the regulations.
The appraisal of the selected lands and one of the private parcels is dated June 22, 1994. A second appraisal of four of the private parcels is dated August 1, 1994.
Appraisals prepared for exchange purposes must contain certain information in order to comply with the regulations.
Most importantly in this case, the regulations require that the appraisal contain:
(1) an analysis of highest and best use (which is defined in the regulations and set out in footnote 1). § 2201.3-3(d);
(2) A description of comparable sales, including a description of all relevant physical, legal and economic factors.... § 2201.3-3(g); and
3) An estimate of market value (also defined in the regulations and set out in footnote 1).