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Kennecott Utah Copper Corp. v. Department of the Interior

ELR Citation: 26 ELR 21489
Nos. 93-1700, 88 F.3d 1191/42 ERC 2089/(D.C. Cir., 07/16/1996)

The court holds that for purposes of Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) §301(g)(1)'s statute of limitations, the U.S. Department of the Interior's (DOI's) "Type B" natural resource damage assessment (NRDA) regulations were promulgated, at the latest, when the regulations were published in the Federal Register in 1987. DOI had interpreted "promulgate" to mean when final regulatory revisions ordered by two court decisions are published in the Federal Register. The court first holds that the district court properly refused to order publication in the Federal Register of 1993 Type B NRDA regulations that DOI submitted for publication on the last day of the Bush Administration but withdrew when President Clinton took office. The Freedom of Information Act, 5 U.S.C. §552(a)(4)(B), does not authorize federal courts to order publication. The court then holds that while the economic injury suffered by petitioner as a result of the withdrawal of the Bush Administration's 1993 regulations falls within the zone of interests protected by the Federal Register Act, the Office of the Federal Register did not violate the Act by allowing DOI to withdraw the regulations. Allowing agencies to withdraw documents during the processing period is consistent with the statute's purpose—establishing an orderly process for filing and publishing government regulations. The court next holds that it lacks statutory jurisdiction under CERCLA §113(a) to consider petitioner's claim that DOI's July 1993 notice reopening the comment period on proposed 1991 regulations, a letter explaining the agency's decision not to publish the 1993 regulations, and the agency's "indefinite postponement" of those regulations violated the Administrative Procedure Act's (APA's) notice-and-comment requirements. Because DOI's decision to withdraw the 1993 regulations did not alter substantive legal obligations under previously published regulations, the agency's decision to withdraw the 1993 regulations did not constitute a "regulation" under CERCLA §113(a). The court also rejects the argument that the 1994 regulations repealed and modified the 1993 regulations without offering APA required notice and comment. The 1994 regulations did not repeal the 1993 regulations, because the 1993 regulations never became binding.

The court next assumes without deciding that Congress authorized DOI to define the term "promulgate" as it is used in CERCLA §113(g)(1)(B). The court holds, however, that even though the text of CERCLA is not so clear as to preclude DOI's interpretation, that interpretation is not reasonable. A regulation is promulgated either on the date of issuance or other formal announcement by the agency, the date of filing with the Office of the Federal Register, or the date of publication in the Federal Register. The court then holds that provisions in the 1994 regulations governing the selection of restoration options, and specifying methods for choosing cost-estimating and valuation methodologies are "protocols" under CERCLA §301(c)(2)(B). The court next holds that DOI's decision not to require trustees to select the most cost-effective restoration option is reasonable, consistent with CERCLA, and with the court's decision in Ohio v. U.S. Department of the Interior, 19 ELR 21099 (D.C. Cir. 1989). Further, DOI's decision not to adopt a standard preventing trustees from selecting a restoration option if the remedy's costs are grossly disproportionate to the resource's use value is a permissible response to the Ohio decision. The court then holds that it is permissible for the regulations to require coordination, rather than consistency, between restoration remedies and response actions. Next, the court holds that the challenge to the 1994 regulations' prohibition on acquiring federal land as a means of relief when alternative restoration measures are available is time barred. Because DOI reproposed virtually the same regulation that was already in effect, and declined to reconsider any aspect of that regulation pertaining to the merits of the restriction on federal land acquisition, it did not reopen the issue. The court refuses to rule on whether DOI exceeded its authority by purporting to authorize recovery for injury to archaeological and cultural resources in the preamble to its 1994 regulations. The court concludes that while in some circumstances a preamble may be reviewable, the 1994 preamble's consistency with CERCLA is not ripe for review, because the industry petitioners have not demonstrated that it has a direct and immediate impact on them. Next, the court holds that the provisions allowing for the recovery of indirect costs incurred in restoring an injured resource are based on a permissible reading of CERCLA, and that the provisions provide adequate guidance to trustees, potentially responsible parties, and courts. The court then holds that DOI's decision to use a preliminary estimate to determine the reasonableness of the anticipated cost of assessing natural resource damages, and to require that the preliminary estimate be included in the assessment report, is reasonable. The court also holds that DOI's interpretation of the Federal Water Pollution Control Act as authorizing trustees to recover damages for the value of lost interim services is permissible. Lastly, the court holds that DOI reasonably interpreted CERCLA §109(f) as not requiring trustees to prefer "restoration," "rehabilitation," and "replacement" of natural resources, over the "acquisition of equivalent resources" when calculating the monetary value of the harm caused by a release of hazardous substances into the environment.

Counsel for Petitioners
Angus Macbeth
Sidley & Austin
1722 I St. NW, Washington DC 20006
(202) 736-8271

Counsel for Respondents
Naikang Tsao
Environment and Natural Resources Division
U.S. Department of Justice, Washington DC 20530
(202) 514-2000