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E.P.I.C. v. PACIFIC LUMBER

September 19, 2002

ENVIRONMENTAL PROTECTION INFORMATION CENTER, INC., A NON-PROFIT CORPORATION; AND, SIERRA CLUB, INC., A NON-PROFIT CORPORATION, PLAINTIFFS,
V.
PACIFIC LUMBER COMPANY, A DELAWARE CORPORATION; SCOTIA PACIFIC HOLDING COMPANY, A DELAWARE CORPORATION; AND SALMON CREEK CORPORATION, A DELAWARE CORPORATION, DEFENDANTS.



The opinion of the court was delivered by: Marilyn Hall Patel, Chief District Judge.

 
MEMORANDUM AND ORDER Re Attorneys' Fees (On Remand)

Plaintiffs Environmental Protection Information Center ("EPIC") and Sierra Club brought this action against defendants Pacific Lumber Company and its subsidiaries Scotia Pacific Holding Company and Salmon Creek Corporation (collectively "PALCO") alleging violations of section 7(d) of the Endangered Species Act ("ESA"), 16 U.S.C. § 1536(d), and seeking declaratory and injunctive relief. The court awarded the requested injunctive relief in an interim order on September 3, 1998, thereby prohibiting PALCO from conducting or allowing logging activities within the boundaries of Timber Harvest Plans ("THP") Nos. 1-96-413 HUM, 1-96-307 HUM and 1-97-286 HUM. The court memorialized this order on March 15, 1999. On May 5, 1999, this court granted defendants' motion for summary judgment and dismissed the action as moot because the consultation period required by ESA section 7(d) had ended, terminating PALCO's duty to refrain from making any further irretrievable commitment of resources. On August 20, 1999, the court recognized plaintiffs' substantial success in this litigation by awarding attorneys' fees pursuant to the ESA, 16 U.S.C. § 1540(g)(4). On July 24, 2001, the Ninth Circuit directed the court to vacate as moot the court's written March 15, 1999 preliminary injunction order and portions of its May 5, 1999 summary judgment order. The Ninth Circuit further directed the court to reconsider plaintiffs' eligibility for attorneys' fees without reliance on the vacated orders. Now before this court is plaintiffs' renewed application for attorneys' fees. Having considered the parties' arguments and submissions, and for the reasons set forth below, the court now enters the following reformed memorandum and order.*fn1

BACKGROUND

Underlying this dispute are lands which are subject to an agreement between PALCO and its parent company, MAXXAM, Inc., the federal government and the state of California to preserve a 7,500-acre tract of old growth redwood forest in Humboldt County, California. The agreement is commonly known as the "Headwaters Agreement." 63 Fed. Reg. 37900-02 (July 14, 1998). The Headwaters Agreement originally anticipated the exchange of the tract of old growth forest for federal and state assets with a value of $300 million and other properties. Id. The Headwaters Agreement also called for, among other things, the development and submission by PALCO of an Incidental Take Permit ("ITP") application pursuant to section 10(a)(1)(B) of the ESA, 16 U.S.C. § 1539(a)(1)(B). Id.

On June 12, 1998, PALCO applied for an ITP to the U.S. Fish and Wildlife Service ("FWS") and National Marine Fisheries Service ("NMFS") (collectively, "the Services"). See 63 Fed. Reg. 37900. The ITP would authorize PALCO to incidentally take 17 listed species and some species that are currently not, but may become, listed during a fifty-year period on approximately 211,000 acres of land owned by PALCO and its subsidiaries. These lands include areas within the Mattole River watershed and the Sulphur Creek and Bear Creek drainages, which according to plaintiffs, are the critical habitats of several species listed as threatened or endangered under the ESA, including the coho salmon ("coho"). In July 1998, in conjunction with its permit application, PALCO submitted a proposed Habitat Conservation Plan ("HCP") in accordance with the requirements of ESA section 10(a)(2)(A), 16 U.S.C. § 1539(a)(2)(A), and a proposed Implementation Agreement. 63 Fed. Reg. 37900.

Meanwhile, because the California Department of Forestry approved the three PALCO THPs in question, PALCO began logging in these areas during the time that the Services were to be consulting on PALCO's ITP application. Pls.' Mot. for Attorneys' Fees (June 21, 1999) at 4:8-4:14 (original fee request). Therefore, on August 12, 1998, plaintiffs filed their complaint seeking a declaratory judgment that PALCO was violating section 7(d) of the ESA by continuing to log in the areas related to the ITP. Plaintiffs also sought a Temporary Restraining Order ("TRO"). On August 14, 1998, Judge Henderson issued the requested TRO and enjoined PALCO from logging within the three areas covered by the above-mentioned THPs. On September 3, 1998, this court converted the TRO into a preliminary injunction. It also extended the original injunction by preventing PALCO from removing logs from the forest floor in those areas. On March 15, 1999 this court memorialized the bench order in writing, fully adjudicating the preliminary injunction.

The Services issued a notice of receipt and availability for public comment for PALCO's permit application, HCP, and proposed Implementation Agreement pursuant to the notice and public comment requirement of section 10(c) of the ESA. 63 Fed. Reg. 37900, 37900-01. On November 16, 1998, the FWS and NMFS initiated "formal consultation" on the Services' proposal to issue an ITP to PALCO pursuant to section 10(a)(1)(B) and its implementing regulations at 50 C.F.R. Parts 17 and 222, respectively. See Letter dated November 16, 1998 from the Services to John Campbell. The Services also stated:

Based on the initiation of formal consultation, the provisions of section 7(d) of the Act and 50 C.F.R. § 402.09 now apply. Under Section 7(d) PALCO may make no irreversible or irretrievable commitment of resources that would have the effect of foreclosing the formulation or implementation of any reasonable or prudent alternatives which would avoid violating section 7(a)(2) of the Act.

Id.

On January 22, 1999, the Services issued a notice of availability of the joint final Environmental Impact Statement/Environmental Impact Report ("EIS/EIR") and Habitat Conservation Plan ("HCP")/Sustained Yield Plan ("SYP") relating to the issuance of the ITPs. 64 Fed. Reg. 3483 (Jan. 22, 1999). The notice of availability states that decisions on the action for which the EIS/EIR was prepared "will occur no sooner than February 22, 1999." Id. In part, the final EIS/EIR is intended to "indicate any irreversible commitment of resources that would result from implementation of the final proposed action." Id. at 3485. On February 24, 1999, the Services issued a Biological/Conference Opinion ("BO") on PALCO's request for the ITPs. On February 25, 1999, the Services also finalized their Record of Decision ("ROD") supporting the issuance of the ITP and related actions. The ITP was issued on February 26, 1999, to be effective on March 1, 1999, upon finalization of the Headwaters Agreement. On March 1, 1999, the Headwaters Agreement was finalized and both the BO and the ITPs were released.

In its BO, the NMFS determined that the issuance of the ITP is neither "likely to jeopardize the continued existence" of the Southern Oregon/Northern California Coast Evolutionary Significant Unit coho, nor "likely to destroy or adversely modify [their] proposed critical habitat." ROD, App. B at 12. The BO also states in closing:

This concludes formal consultation and conference on the action outlined in the request. As provided in 50 C.F.R. § 402.16, reinitiation of formal consultation is required where discretionary Federal agency involvement or control over the action has been retained (or is authorized by law) and if: (1) the amount or extent of incidental take is exceeded; (2) new information reveals effects of the agency action that may affect listed species or critical habitat in a manner or to an extent not considered in this opinion; (3) the agency action is subsequently modified in a manner that causes an effect to the listed species or critical habitat not considered in this opinion; or (4) a new species is listed or critical habitat designated that may be affected by the action. In instances where the amount or extent of incidental take is exceeded, any operations causing such take must cease pending reinitiation.

BO at 416-17.

Prior to the release of the BO and the ITP, plaintiffs filed a motion for partial summary judgment asking this court to declare PALCO subject to the provisions of ESA section 7(d). PALCO filed a cross motion for summary judgment and motion for dismissal arguing that the action was mooted by the completion of consultation required by ESA section 7(d). On May 5, 1999, this court issued an order granting defendants' motion for summary judgment and/or motion to dismiss as moot and denying plaintiffs' motion for partial summary judgment.

On August 20, 1999, this court awarded plaintiffs attorneys' fees in the amount of $223,130 and costs of $8,935.42 because the litigation substantially contributed to the goals of the ESA.

Defendants subsequently appealed the September 3, 1998 interim preliminary injunction order and the written March 15, 1999 order; those portions of the May 5, 1999 summary judgment order addressing the merits of this action; and the judgment entered on May 5, 1999. Pls.' Renewed Mot., Exh. C ("Notice of Appeal," May 13, 1999); see also Pearl Supp. Dec. (Feb. 25, 2002), Exh. D ("Appellant's Reply Br."). The Ninth Circuit did not address the merits of the litigation nor vacate the September 3, 1998 order, but granted defendants' remaining requests. EPIC v. PALCO, 257 F.3d 1071 (9th Cir. 2001). The Ninth Circuit further filed a memorandum disposition, directing this court to reconsider plaintiffs' attorneys' fees request without reliance on the March 15 order or the vacated portion of the May 5 order. EPIC v. PALCO, 2001 WL 949956, *1 (9th Cir. 2001).

Plaintiffs contend that they are entitled to attorneys' fees and costs in the amount of $295.797.05 because this litigation substantially contributed to the goals of the ESA, notwithstanding the Ninth Circuit decision. Plaintiffs' request reflects interest on the original award and fees and costs incurred preparing the renewed attorneys' fees motion.

LEGAL STANDARD

I. Fee Eligibility

In any citizen suit brought under the Endangered Species Act, a district court "may award costs of litigation (including reasonable attorney and expert witness fees) to any party, whenever the court determines such award is appropriate." 16 U.S.C. § 1540(g)(4). Thus, a court's discretion to award attorneys' fees is restricted to "appropriate" cases. Although the Supreme Court has not explicitly considered the contours of "appropriateness" in the context of the Endangered Species Act, it considered an identical attorneys' fees provision of the Clean Air Act in Ruckelshaus v. Sierra Club, 463 U.S. 680, 103 S.Ct. 3274 (1982).*fn2 The Court held that a party need only prevail in part, i.e., achieve "some degree of success on the merits," before a district court may determine that an award of attorneys' fees is appropriate. Id. at 694, 3282.

The Court thus found that the attorneys' fees provision of the Clean Air Act creates a less-demanding standard than that of civil rights statutes. The Civil Rights Act, 42 U.S.C. § 1988, for example, limits attorneys' fees to "prevailing parties." To qualify, one must prevail "on a significant issue in the litigation" and "obtain[] some of the relief . . . sought." Texas Teachers Ass'n v. Garland Indep. Sch. Dist., 489 U.S. 782, 793, 109 S.Ct. 1486, 1494 (1989). In contrast, the Clean Air Act, "expand[s] the class of parties eligible for fee awards from prevailing parties to partially prevailing parties — parties achieving some success, even if not major success." Ruckelshaus, 463 U.S. at 688, 3279 (emphasis in original).

The Ninth Circuit subsequently considered attorneys' fees standards under the ESA, noting that courts should award fees in environmental actions if the party has substantially contributed to the goals of the statute. Carson-Truckee Water Conservancy Dist. v. Secretary of the Interior, 748 F.2d 523, 525 (9th Cir. 1984).*fn3 By this standard, "whether the party claiming costs or fees has prevailed does not control the inquiry on appropriateness[. Instead,] the dominant consideration is whether litigation by the party has served the public interest ...


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