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Klamath Irrigation District v. United States

ELR Citation: 41 ELR 20094
Nos. No. 2007-5115, (Fed. Cir., 02/17/2011) vacated and remanded

The Federal Circuit vacated and remanded a lower court decision dismissing breach of contract, takings, and Klamath River Basin Compact claims brought against the U.S. government by agricultural landowners and water, drainage, and irrigation districts in Oregon and California. The plaintiffs, who use water in the Klamath River Basin in southern Oregon and northern California, filed suit after the Bureau of Reclamation halted the delivery of irrigation water in 2001 pursuant to its responsibilities under the ESA due to severe drought conditions and its impact on endangered wildlife. The lower court dismissed the claims. On appeal, the Federal Circuit certified three questions pertaining to the plaintiffs' takings and Compact claims to the Oregon Supreme Court due to unsettled questions of state law. Having reviewed the certification decision, the court remanded the case for the lower court to determine whether plaintiffs have asserted cognizable property interests. Because the parties do not dispute that plaintiffs have put Klamath Project water to beneficial use and that the United States acquired the pertinent water rights for plaintiffs' use and benefit, the court should address whether contractual agreements between plaintiffs and the government have clarified, redefined, or altered the foregoing beneficial relationship so as to deprive plaintiffs of cognizable property interests for purposes of their takings and Compact claims. As for the breach of contract claims, on remand the lower court must determine whether the government can establish that contract performance was impossible.