Federal Court Dismisses As Premature Lawsuit Challenging DRBC Failure to Comply With NEPA in Developing Natural Gas "Fracking" Regulations

Delaware River Basin CommissionA federal district court judge has dismissed as premature three consolidated lawsuits challenging the failure of the Delaware River Basin Commission (DRBC) and other federal defendants to comply with the National Environmental Policy Act in the course of drafting and considering regulations that would permit natural gas development in the Delaware River Basin.   In a memorandum and opinion dated September 24, 2012, the court dismissed the actions for lack of jurisdiction.  The court found that because the DRBC has merely released draft regulations for public comment, plaintiffs had not yet established an “injury-in-fact ” requisite to establish Article III standing for federal court jurisdiction. The court observed, “The line between proposed regulations and final regulations may be subtle, but the court believes it is real[.]”

The court recognized that “a plaintiff can show an injury-in-fact through showing the creation of an increased risk of invasion of concrete interests; in NEPA cases, this chain of reasoning is extended to allow for an injury based on the increased risk in uninformed decision-making that will create an increased risk in the invasion of a concrete interest.” However, generally in such cases, “the agency has done something that has affected legal rights or obligations of some party in a way that made an invasion of plaintiffs interests more likely, or refused to do something that allowed an already existing invasion to continue.”  Here, because the regulations are merely draft, “the court has no way of judging reliably how probable it is that the regulation will be enacted, and thus no way of judging whether risks that natural gas development may create are more than conjecture.” The court also found that the claims were not ripe for judicial review.

However, the dismissal is by no means the end of the lawsuit. We can reasonably anticipate an appeal of the dismissal. Moreover, under the court’s ruling, a challenge to the regulations as violative of NEPA would be ripe and appropriate if, and when, such regulations are issued in final form and plaintiffs are able to establish the requisite “injury-in-fact.”

The Court Found That All Plaintiffs Had Interests Sufficient to Bring the Lawsuit

Although the court rejected the plaintiffs’ claims of “injury-in-fact” to confer Article III standing, the court found that all of the plaintiffs had concrete interests sufficient to bring the lawsuits: State of New York, Delaware Riverkeeper, Riverkeeper, Inc.Damascus Citizens for Sustainability, and the National Parks Conservation Association. The interests that New York State asserted are particularly interesting, because they involve air pollution as well as concerns over water quality.  One set of interests asserted by New York was maintaining the status quo in the Upper Delaware River, home to numerous endangered species. New York claims ownership of the shellfish, fish, birds, and other animals that live wild on New York’s land and in its waters. New York also asserted property rights in land, facilities, and the rights to conservation easements along the Upper Delaware, which gave New York proprietary interests sufficient to confer standing.  New York’s other asserted interest is tied to preventing increases in ozone (O3) concentrations over New York’s population, which can increase due to natural gas production. As New York asserted,  ozone can cause respiratory health problems, asthma attacks, and may also be linked to higher mortality rates. The court declared that New York’s “desire to prevent its residents from suffering from increased ozone exposure is analogous to a state’s desire to secure the abatement of a public nuisance—in other words, a quasi-sovereign interest in the health of its residents.”

The Troubled History of DRBC Compliance With NEPA

The court did not address the merits of the plaintiffs’ claims that DRBC violated NEPA by drafting natural gas development regulations without complying with NEPA’s procedural requirements.  However, one need look no further than the court’s simple review of DRBC history to see that DRBC’s compliance with NEPA requirements is problematic:

After NEPA was enacted in 1970, the DRBC promulgated regulations implementing it as to its own operations. (NGO Pls. Mem. (11–CV–2599 Docket Entry # 79–1) at 4–5.) The CEQ’s guidelines on preparing EISs published in the 1970s included the DRBC as a federal agency. (Id. at 5.) The DRBC performed NEPA analyses during that decade. (Id.) In 1980, however, the DRBC suspended its NEPA-implementing regulations due to lack of financial resources and indicated it would rely on an agency of the federal government to serve as “lead agency” and perform EISs for DRBC projects. (Id.) In 1997, the DRBC repealed its NEPA regulations. (Id.)

It is hard to imagine how an agency could successfully claim that it can avoid NEPA obligations because of “lack of financial resources.”  We note that historically the DRBC has prepared environmental impact statements and in several cases the Commission conceded that it was a federal agency for purposes of NEPA. See, e.g., Bucks County Bd. of Commissioners v. Interstate Energy Co., 403 F. Supp. 805, 808 (E.D. Pa. 1975) (DRBC as the designated federal agency to prepare and review an EIS); Borough of Morrisville v. DRBC, 399 F. Supp. 469, 479, n.7 (E.D. Pa. 1975) (DRBC conceded it was a federal agency for purposes of NEPA). In Delaware Water Emergency Group v. Hansler, 536 F.Supp. 26, 36 (E.D. Pa., 1981), while the court expressed some doubt on the matter, it also noted that the DRBC did not dispute that NEPA obligations applied to it, and stated ‘to the extent that the United States’ member of the Commission votes in favor of an application or otherwise acquiesces in accordance with the Compact, such approval might be deemed Federal action.'”

We will report on further developments in the case as they emerge.

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