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Union Oil Co. of Cal. v. Morton

Citation: 5 ELR 20218
No. No. 73-1692, 512 F.2d 743/7 ERC 1587/(9th Cir., 02/24/1975)

A lower court's ruling that the Secretary of the Interior did not abuse his discretion in denying permission to build an oil drilling platform in the Santa Barbara Channel is vacated, and the case remanded. The plaintiff oil company is in error in claiming that any order of the Secretary which violates the terms of a lease granted under the Outer Continental Shelf Act is per se invalid. The statute, in conjunction with NEPA, clearly empowers the Secretary to issue environmental conservation regulations which bind previously executed leases. If, however, the Secretary effectively revokes a lease, rather than merely suspending it, this constitutes a taking under the Due Process Clause for which there must be compensation. The Secretary's stated reasons for "suspending" the right to construct the platform include some considerations which may change with the passage of time, and others — such as the aesthetic undesirability of more drilling platforms — which are not temporary, and suggest that a revocation of the lease has in fact occurred. The Secretary's explanation was inadequate to support a finding by the district court that he did not commit an abuse of discretion, and the case is accordingly remanded for further findings of fact and appropriate action.

Counsel for Plaintiff-Appellants
Samuel O. Pruitt, Jr.
Gibson, Dunn & Crutcher
515 South Flower Street
Los Angeles, Cal. 90071

Counsel for Defendant-Respondents
Jacques B. Gelin
Department of Justice
Washington, D.C. 20530
A. Barry Cappello City Attorney
City Hall
De La Guerra Plaza
Santa Barbara, Cal. 93101
Marvin Levine Deputy County Counsel
1233 Mission Ridge Road
Santa Barbara, Cal. 93103