MEMORANDUM OF DECISION RE ORDER ON REMAND
The Court, having considered Defendants' Bureau of Land Management, U.S. Department of the Interior and U.S. Department of Agriculture, Forest Service ("Federal Defendants") "[Proposed] Order on Remand" (Exhibit B to Docket #82), Defendant Calpine Corporation's ("Calpine") response to the [Proposed] Order on Remand and suggested modification to paragraph 7 of the [Proposed] Order on Remand (Docket #85), and Plaintiffs' Pit River Tribe, Native Coalition for Medicine Lake Highlands Defense and Mount Shasta Bioregional Ecology Center ("Plaintiffs") response to the [Proposed] Order on Remand (Docket #86), and all the briefs submitted by the parties in support of their positions with respect to the [Proposed] Order on Remand and in response to the positions asserted by the parties (Docket ## 89, 91, 92, 93, 94, 95 and 99), and being fully advised orders that the Federal Defendants' [Proposed] Order on Remand, along with the modification to Paragraph 7 proposed by Calpine (Docket #85 at p. 2) is hereby approved by the Court. A copy of the Court's final Order on Remand is attached hereto and incorporated by reference herein.*fn1
The [Proposed] Order on Remand has been accepted by all parties with the exception of a few disputed items which are fundamental. The Federal Defendants and Calpine contend that the Ninth Circuit decision which led to this remand (469 F.3d 768) requires the Federal Defendants to reconsider only the lease extension granted in 1998 and subsequent decisions. Plaintiffs contend that the underlying leases granted in 1988 have expired and the leasing process must begin from scratch.
First, this Court agrees with the Federal Defendants and Calpine's arguments that the final Order on Remand should clarify and decide whether Plaintiffs are entitled to the relief they requested. When the court of appeals directed this Court "to enter summary judgment in favor of Pit River consistent with [its] opinion," 469 F.3d at 788, it left this Court to specify terms of judgment that would satisfy the mandate. Thus, as usual, the decision "leaves any issue not expressly or impliedly disposed of on appeal for consideration by the trial court on remand." Firth v. United States, 554 F.2d 990, 993-94 (9th Cir. 1977). See also Herrington v. County of Sonoma, 12 F.3d 901, 904 (9th Cir. 1993).
Accordingly, the Court rejects Plaintiffs' argument that the disputed issues with respect to the [Proposed] Order on Remand are not "ripe." Plaintiffs' own Complaint twice requests an order "setting aside the geothermal leases." Complaint at 2, ¶ 3; id. at 26, ¶ 2. Federal Defendants and Calpine are entitled to know whether the judgment against them grants that relief.
Second, the Court finds that Plaintiffs' argument that the 1988 leases "expired by their own terms" in 1998 and cannot now be extended to be without merit. The court of appeals expressly found that the Bureau of Land Management ("BLM") extended the leases in 1998, 469 F.3d at 777. That the decision to extend the leases was not preceded by adequate environmental analysis does not change the fact that the extension was granted. It only means that this Court must fashion an equitable remedy ensuring full compliance with NEPA. The court of appeals decision makes clear that the mere finding of a NEPA violation does not automatically and retroactively invalidate anything. The two alternative remedies identified by the court of appeals which would ensure full compliance were: (1) invalidating the leases as of 1998 thus nullifying the 2002 extensions; or (2) enjoining any surface-disturbing activity until the agencies comply fully with NEPA and other statutes. 469 F.3d at 779.
The Ninth Circuit has repeatedly recognized that a "court ha[s] discretion to preserve leases and other contracts issued without NEPA compliance" if the procedural flaw [can be] rectified in another way. Natural Resources Defense Council v. Houston, 146 F.3d 1118, 1129 (9th Cir. 1998), Northern Cheyenne Tribe v. Lujan, 851 F.2d 1152 (9th Cir. 1988), Conner v. Burford, 848 F.2d 1441 (9th Cir. 1988). If leases issued without NEPA compliance are not automatically void or even subject to being declared void it follows that in this case, despite noncompliance, the 1998 lease extension in this case took effect and the 1988 leases did not expire.
Furthermore, Plaintiffs' had the opportunity to challenge the underlying 1988 leases, but failed to do so within the statute of limitations period. The court of appeals explicitly refused to consider the validity of the 1988 leases because the statute of limitations period had run. 469 F.3d at 781. Plaintiffs should not be able to now challenge those leases over twenty years after their creation.
Plaintiffs' argument herein also appears to directly contradict their arguments before the court of appeals. In their June 14, 2006 Supplemental Brief filed with the court of appeals (Pit River Tribe v. BLM, No. 04-15746 (Ninth Cir.)), Plaintiffs represented to the court of appeals that effective relief could be granted without invalidating the leases. The order proposed by the Federal Defendants and Calpine and adopted by this Court, will ensure that the environmental review required by the court of appeals will not be inhibited. The Court's Order specifically requires a "hard look" at whether lands affected by the leases should be developed for energy at all (¶ 9), and expressly provides that BLM shall have absolute discretion to void or cancel the leases, deny lease extension, deny approval of Calpine's plan of utilization or deny surface development on National Forest System lands affected by the leases (¶ 7). Nothing more is required for effective relief.
Finally as to Calpine's proposed modification to paragraph 7 to the [Proposed] Order on Remand, this Court approves and adopts this modification in its Final Order. The Court does so with the specific understanding, confirmed by the Federal Defendants and Calpine, that the intent and sole effect of this proposed addition is to clarify how the Federal Defendants can still have discretion to deny lease extension (as provided for in ¶ 9) if Calpine elects application of the new Geothermal Steam Act regulations pursuant to 43 C.F.R. § 3200.7(a).*fn2 As Calpine states:
... the sole purpose of the clarification proposed by Calpine to paragraph 7 of the Proposed Order is to make it clear that the Geothermal Steam Act amendments of 2005 and implementing regulations would not apply to the remanded decision of whether the leases should be extended. As such Calpine's clarification recognizes that the extension provision under the new regulations (see 43 C.F.R. ¶ 3207.10(b)) does not trump the Ninth Circuit decision, and that any decision to opt into the new regulations would only apply prospectively, after a thorough NEPA and NHPA review and in the event of an agency decision to grant the lease extensions. (Docket #93 at p. 3.)
This matter comes before the Court on remand from the Ninth Circuit in Pit River Tribe v. U.S. Forest Service, 469 F.3d 768 (9th Cir. 2006). Having reviewed the decision of the court of appeals and submissions from the parties on remand, the Court hereby enters summary judgment for plaintiffs on the Fourth, Fifth and Ninth causes of action in their complaint and, accordingly, orders:
1. Defendant Calpine Corporation ("Calpine") is enjoined from conducting any surface-disturbing activities on Leases CA 21924 and 21926 ("the leases") pending the following actions by defendants Bureau of Land Management ("BLM") and U.S. Department of Agriculture, Forest Service ...