Virginia Surface Mining and Reclamation Association, Inc. v. Andrus

No. 78-0244-B (W.D. Va. February 14, 1979)

The court issues a temporary injunction against enforcement of §§ 502-522 of the Surface Mining Control and Reclamation Act of 1977 pending a ruling on the merits of plaintiffs' challenge to the constitutionality of these statutory provisions. The court finds that the Act's strict controls on strip-mining operations on slopes greater than 20 degrees would make surface mining of 95 percent of the coal reserves in Virginia commercially impracticable, and notes that numerous small coal companies have already gone out of business partly because of these restrictions. Plaintiffs have shown that they will suffer irreparable injury in the absence of injunctive relief, while defendants have not demonstrated that a temporary injunction will adversely affect other parties or the public interest. The court holds that this tilting of the balance of hardships in plaintiffs' favor makes a determination of their likelihood of success on the merits unnecessary, but nonetheless expresses the view that plaintiffs are likely to prevail on two of their constitutional claims. Distinguishing the recent Supreme Court decision in Penn Central Transportation Co. v. New York City, 8 ELR 20528, the court concludes that plaintiffs have made a strong showing that the Act's reclamation requirements may violate the fifth amendment prohibition against the taking of property without just compensation. The court also finds that the statutory provision authorizing federal inspectors to issue orders to cease mining for 30 days without prior notice or hearing constitutes a denial of due process.

Counsel for Plaintiffs
John L. Kilcullen
Kilcullen, Smith & Heenan
Suite 600, 1800 M St. NW, Washington DC 20036
(202) 296-5700

Kenneth P. Ashbury, City Attorney
129 Main St., Wise VA 24293
(703) 328-5286

Counsel for Defendants
Morgan E. Scott, Ass't U.S. Attorney
P.O. Box 1709, Roanoke VA 24008
(703) 982-6250

Robert T. Copeland
Bradshaw, Morris & Copeland
206 E. Main St., Abingdon VA 24210
(703) 628-8121

[9 ELR 20235]

Williams, J.:

A complaint to enjoin enforcement of the Surface Mining Control and Reclamation Act of 1977, Title 30 U.S.C. § 1201 et seq., was filed on the 23d day of October 1978, by the Virginia Surface Mining and Reclamation Association, Inc., a voluntary, non-profit association of small coal producers, the principal purpose of which is to represent the interests of the coal mining industry in Virginia and to assist the public authorities in dealing with problems that affect the industry; by sixty-three (63) coal companies which are members of the association and are engaged or have been engaged in surface coal mining operations in the western district of Virginia; and by four (4) landowners, who are the owners of coal lands and mineral estate interests in coal lands on which surface coal mining operations are being conducted, or which are suitable for surface coal mining operations. Defendant Cecil D. Andrus, Secretary of the Interior, is charged with the responsibility for administering and enforcing the provisions of the Surface Mining Control and Reclamation Act of 1977, which was enacted into law by the United States Congress on August 3, 1977.

This court has jurisdiction of this action under Title 28 U.S.C. §§ 1331 and 2201.

Briefly summarized, the complaint alleges that the Surface Mining Control and Reclamation Act of 1977 is unconstitutional because the Act infringes upon power reserved to the states by the tenth amendment to the United States Constitution; that the reclamation requirements of the Act violate the fifth amendment to the United States Constitution, prohibiting the taking of private property without just compensation; that the power granted under the Act to the defendant to issue cessation orders without a hearing violates the due process clause of the fifth amendment to the United States Constitution; and that the Act violates the equal protection guarantee of the fifth amendment of the United States Constitution. Plaintiffs further allege that if the Act is enforced, they and other citizens of the Commonwealth of Virginia will suffer irreparable injuries in violation of their rights guaranteed and protected by the Constitution of the United States, and for which injuries they have no adequate remedy at law. The plaintiffs petition the court to declare the Surface Mining Control and Reclamation Act of 1977 unconstitutional for the reasons above stated, and they seek a preliminary and a permanent injunction enjoining and restraining the Secretary of the Interior and his agents, employees, and representatives from enforcing against the plaintiffs the unlawful and unconstitutional provisions of the Act.

On the 4th day of December 1978, this court entered an Order granting the Town of Wise, Virginia, leave to intervene in this proceeding as a party plaintiff. The Town of Wise has filed a complaint alleging that it is irreparably harmed by the provisions of the Surface Mining Control and Reclamation Act of 1977 in that its tax revenue will be reduced because of the effects of the Act on employment in the area. The Town of Wise seeks the same relief as that sought by the original plaintiffs in this suit.

On the 17th day of January 1979, plaintiffs filed a motion for a temporary injunction supported by affidavits and accompanied by a memorandum of law in support of the motion.

On the 22d day of January 1979, defendant Cecil D. Andrus filed a motion to dismiss the complaint accompanied by a memorandum in support of the motion.

On the 23d day of January 1979, this court entered an Order setting a hearing on the motion for a preliminary injunction for the 13th day of February 1979, and further directed the defendant to submit any counter-affidavits on or before the 9th day of February 1979. By Order dated February 2, 1979, this court also set arguments on the motion to dismiss filed by the defendant for the 13th day of February 1979.

On the 6th day of February 1979, this court granted the motion of Virginia Citizens for Better Reclamation, Inc., for leave to intervene as amicus curiae in support of the defendant and the court directed that their brief and supporting affidavits should be submitted no later than February 9, 1979.

On the 9th day of February 1979, the plaintiffs filed additional affidavits in support of their motion for preliminary injunction and a brief in opposition to the motion to dismiss. Also, Virginia Citizens for Better Reclamation, Inc. filed affidavits and brief in opposition to the motion for temporary injunction. On the 12th day of February, the defendant filed a brief in opposition to the motion for preliminary injunction and an affidavit of Charles A. Beasley, Acting Regional Director, Region I, Office of Surface Mining and Enforcement, Department of the Interior.

On the 13th day of February 1979, the court heard direct testimony from David W. Harris, B. V. Cooper, Phillip Trent, Dennis Willis, James McClellan, Curtis Bowers, and Michael Quillen on behalf of the plaintiffs and Douglas Stone on behalf of the defendant.

Findings of Fact

For purposes of considering both the motion to dismiss filed by the defendant and the motion for a temporary injunction filed by the plaintiffs, this court must accept certain facts as undisputed inasmuch as these facts are supported by affidavits and accompanying documents and have not been contradicted by any counter-affidavits or other evidence.

The Surface Mining Control and Reclamation Act imposes stringent performance standards upon coal mining operations on [9 ELR 20236] slopes greater than 20 degrees. Indeed, it is stated in the defendant's brief that one of the purposes of the Act is to prevent surface mining operations from being conducted where reclamation is not feasible. The primary thrust of the affidavits filed on behalf of the plaintiffs is that the Act makes surface mining economically prohibitive on slopes of 20 degrees or greater. An examination of the Act confirms this contention.

The undisputed facts in this case show that the Act has its greatest impact on the land area located in the western district of Virginia, since 95 percent of the coal reserves found in Virginia and capable of being strip mined are located on slopes with an incline greater than 20 degrees. In fact, the Act is intended to focus on central Appalachia, consisting of the eastern part of Kentucky and parts of West Virginia and Virginia. The Act has only minimal impact on the entire western coal producing area of the United States, since no surface coal reserves are located on steep slopes in the midwestern states, and in all of the western states where there are large coal reserves, the only state adversely affected by the Act is Colorado, which has 10 percent of its coal reserves located on steep slopes. Even in the eastern United States, only 6 percent of Pennsylvania's reserves is found on steep slopes and only 9 percent of the coal found in Alabama is on steep slopes.

Some of the coal companies which are plaintiffs in this suit are located in Buchanan County, Virginia, in which county coal mining earnings represent 63.7 percent of the total income of the entire county. The evidence shows that the Act establishes performance standards which are designed to restrict or prevent the recovery of coal from 95 percent of the coal reserves in the western district of Virginia, as contrasted with other states which are either totally unaffected or are minimally affected by the steep slope restrictions.

According to the evidence of Dennis V. Willis, a professional engineer registered in the states of Virginia, Kentucky, Tennessee, and West Virginia, if it is assumed that an operator could in some way obtain a permit for surface mining, and considering that the average slope in Virginia is 26 degrees, the increase in mining costs imposed by the Act could increase the cost of coal production in Virginia by as much as 73 percent. Since the cost of mining coal in most of the other coal producing states would not be increased at all, a mining operation in Virginia probably could not exist and compete due to the increased costs imposed by this Act. Therefore, assuming that the Act does permit mining on slopes in excess of 20 degrees, the increased costs make it commerically impracticable to do so, and for this reason alone as much as 95 percent of the coal in Virginia could not be mined through surface mining.

Furthermore, the Act requires land that has been mined by surface mining to be restored to its original contour (with some possible exceptions) despite the fact that in many cases the land is more useful as flat land. The evidence of George E. Honeycutt shows examples of land which has been surface mined and not restored to its original contour: at this time the Wise County, Virginia, Fairgrounds are located on a reclaimed surface mine; the airport at Wise, Virginia is located on reclaimed surface mine land which was not restored to its orginal contour; also the Norton, Virginia, Community Hospital, the Norton Elementary School, a low-income housing development, and a large shopping center are similarly located. The undisputed evidence also shows that in many of the counties in western Virginia, flat land is practically nonexistent and needed for commercial, residential, and public uses.

The evidence discloses that since the passage of the Surface Mining Control and Reclamation Act of 1977, twenty-six (26) Virginia coal producing companies have gone out of business, due partly to the restrictions imposed by the Act.

The court also finds from the evidence that, since the federal Act became effective, in excess of five hundred (500) coal miners have become unemployed in southwest Virginia. Some of this unemployment is directly related to the Act, and many of these miners are now drawing unemployment benefits. The number of surface mining permits has plummeted, and thirty-five (35) cessation orders have been issued by federal inspectors, and, as a direct result, some coal companies were put out of business, even though later hearings exonerated the companies from any violation of the Act.

While the defendant contends that the public will be irreparably harmed if an injunction is issued in this case because of blasting, flooding, and pollution, the weight of the evidence shows that with regard to blasting, those suffering property damage have an adequate remedy at law. As to flooding and pollution, the plaintiffs presented to the court documentary and expert testimony which, to say the least, renders it doubtful or inconclusive that strip mining causes flooding or pollution.

Conclusions of Law

In determining the standards to be applied in ruling on the defendant's motion to dismiss and the plaintiffs' motion for a temporary injunction, the court is of the opinion that the case of Blackwelder Furniture Company v. Seilig Manufacturing Company, Inc., 550 F.2d 189 (4th Cir. 1977), is controlling. The Blackwelder court set forth the following four standards which should be considered in determining entitlement to injunctive relief:

1) Has the petitioner made a strong showing that it is likely to prevail upon the merits?

2) Has the petitioner shown that without such relief it will suffer irreparable injury?

3) Would the issuance of the injunction substantially harm other interested parties?

4) Wherein lies the public interest?

550 F.2d at 193. The court further states in Blackwelder:

[T]he first step in a Rule 65(a) situation is for the court to balance the "likelihood" of irreparable harm to the plaintiff against the "likelihood" of harm to the defendant; and if a decided imbalance of hardship should appear in plaintiff's favor, then the likelihood-of-success test is displaced. . . .

550 F.2d at 195.

Applying the Blackwelder test to the instant case, this court finds that the plaintiffs have shown that unless the court grants the temporary injunction now, plaintiffs will suffer irreparable injury; on the other hand, the defendant has introduced scant evidence to show that the issuance of the temporary injunction would substantially harm other interested parties or that the public interests would be adversely affected. Therefore, under the Blackwelder test, it is not necessary for this court to determine whether the plaintiffs are likely to succeed on the merits of their suit; in ruling on plaintiffs' motion for a temporary injunction, this court need not determine at this time whether the motion to dismiss is meritorious. Hence, this court takes the motion to dismiss under advisement until the court determines whether a permanent injunction should issue in this case.

While the court does not consider it necessary to discuss the merits of this case, the court does believe that the following comments should now be made with regard to the merits of the plaintiffs' actions and plaintiffs' likelihood of success. The court does not express an opinion as to whether the Surface Mining Control and Reclamation Act of 1977 infringes upon the powers reserved to the states by the tenth amendment, nor does the court express any opinion as to whether the Act violates the equal protection guarantees of the fifth amendment. But the court does believe that the plaintiffs have mad a strong showing that they are likely to prevail on the merits of this case, in that the reclamation requirements of the Act may violate the fifth amendment's proscription against the taking of private property without just compensation, and that § 521(a) of the Act (which provides that under certain circumstances, a cessation order may be issued without prior notice or hearing) violates the due process clause of the fifth amendment.

In considering whether the Surface Mining Control and Reclamation Act of 1977 constitutes a taking of the plaintiffs' property without due process of law and without just compensation in violation of the fifth amendment to the Constitution, the court finds that the plaintiffs have shown at this stage of the proceedings that the Act's effect is to make it economically impracticable to surface mine coal on a steep slope in Virginia. Ninety-five percent of the Virginia coal reserves capable of being stripped are located on mountain slopes steeper than 20 degrees, and the average [9 ELR 20237] slope angle on which surface mining is conducted is 25 degrees. Even assuming, arguendo, that the Act does not eliminate the stripping of coal on mountain slopes steeper than 20 degrees, the plaintiffs have shown that it is economically impracticable under the provisions of the Act to mine coal on these slopes.

The Supreme Court of the United States has specifically spoken on this issue. In Pennsylvania Coal Company v. Mahon, 260 U.S. 393 (1922), the Supreme Court stated:

"For practical purposes, the right to coal consists in the right to mine it." [Citation omitted.] What makes the right to mine coal valuable is that it can be exercised with profit.To make it commercially impracticable to mine certain coal has very nearly the same effect for constitutional purposes as appropriating or destroying it. . . . We are in danger of forgetting that a strong public desire to improve the public condition is not enough to warrant achieving the desire by a shorter cut than the constitutional way of paying for the change.

260 U.S. at 414, 416.

Defendant contends that the recent Supreme Court decision in Penn Central Transportation Co. v. City of New York, 438 U.S. 104, 98 S. Ct. 2646 (1978), specifically grants to the government the right to impose restrictions upon the use of private property without paying for the same. But Penn Central does not in any way overrule Pennsylvania Coal Company v. Mahon, supra; on the contrary, the case specifically reaffirms Mahon. Making an exception to the general rule that the government cannot take private property without just compensation, the Penn Central Court observes that the designation of Grand Central Station as a landmark did not in any way interfere with the present use of the terminal. The Court also found that future uses of the air space above the terminal were not prohibited, and finally, the Court found that New York City provided other means for compensation through its transferable development rights program. Penn Central therefore is readily distinguishable from Mahon, for in the present case, there is an interference with the present use of the land; in Penn Central, there was no interference by the government which prevented Penn Central from continuing its present use of the terminal. The Supreme Court has also in numerous contexts, such as zoning laws, held that laws adversely affecting economic values do not constitute a "taking" for fifth amendment purposes; however, these cases also are readily distinguishable under the facts before the court at this stage of the proceedings.

Likewise, the court finds that certain statutory provisions, allowing a federal inspector without holding any hearing at all to require a mine operator to cease operation for a period of 30 days, or even five days, constitute a denial of due process of law.An argument that such an immediate cessation of mining is not a denial of due process of law does not take into consideration the practical realities of coal mining. For practical purposes, shutting down a coal mine for 30 days, or even for five days, means that all the employees are unemployed for this period of time; the machinery lays idle, while the payments to creditors continue; the machinery rusts and deteriorates; and, in many instances, water becomes a problem and landslides become inevitable. Therefore, one may easily envision a situation in which a mine is shut down by cessation order, and although a later hearing might conclude that the order was improper, the cessation order likely could result in a mine being shut down from six months to a year or even longer, possibly making it impracticable to ever operate again. Indeed, the evidence discloses that this has already occurred in several instances resulting in mines being permanently shut down.

The government in the case at bar contends that summarily and unilaterally requiring a coal mine to cease operations is comparable to the government's seizing a rental yacht carrying marijuana, or seizing a mislabeled vitamin product, or appointing a conservator for a savings and loan association, or imposing rent control orders, or collecting federal revenue, or seizing enemy property. Such governmental actions are obviously distinguishable. For example, the collection of federal revenue in advance without a hearing only requires the taking of money, which the government holds, and if the government has improperly received it, it can be returned with interest. There is no irreparable damage in such a case to the party from whom the money is seized. The same reasoning applies to the seizure of a rental yacht, for if the person is operating a legitimate business, he can always rent a replacement yacht, and the seized yacht is not destroyed during the time it is held.

In the instant case, the court is concerned with cessation orders, which can prohibit a person from using his own land or interest in land. The government has failed to show this court any case in which the federal government, without a hearing, forced a person not to use his own land, particularly under circumstances such as mining, where the harm may very well be irreparable. This court believes that to require a person to cease mining, without proper notice or opportunity for a hearing, is a flagrant violation of the fifth amendment to the Constitution of the United States, which requires that a hearing be conducted prior to such a taking. This court is of the opinion that the plaintiffs have shown a strong likelihood of prevailing on at least these two issues in this case.

Therefore, this court having fully considered the plaintiffs' motion for a preliminary injunction, together with the various affidavits submitted therewith, and the respective memoranda submitted by the plaintiffs and the defendant, and having heard oral argument thereon, it is hereby ADJUDGED AND DECREED that defendant and all persons serving as officers, employees, and agents subject to his control and direction, are hereby enjoined and restrained, until such time as this court renders a final judgment or decree on the matter complained of in the complaint and embraced in such motion for a preliminary injunction, from taking any action to enforce (by cessation order, permit suspension or revocation, violation citations or notices, penalty, prosecution, or otherwise) any and all provisions of §§ 502 through 522 of the Surface Mining Control and Reclamation Act of 1977, 30 U.S.C. §§ 1252-1272.

It is further ORDERED that a hearing is hereby set for the purpose of presenting such evidence as may be desired by either party and further arguments on behalf of any parties, as to whether a permanent injunction shall be granted in this case. Such hearing shall commence at 9:30 a.m. on the 26th day of March 1979, at Big Stone Gap.