6 25 13 CIPA AC Brief

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BRIEF OF CALIFORNIA INDEPENDENT PETROLEUM ASSOCIATION RE REMEDY
CASE NO. CV-11-06174-PSG

Benjamin G. Shatz (CA Bar No. 160229)
MANATT, PHELPS & PHILLIPS, LLP
11355 West Olympic Boulevard
Los Angeles, CA 90064-1614
Telephone: 310-312-4000
Facsimile: 310-312-4224
BShatz@manatt.com

Steven J. Lechner (CO Bar No. 19853) (pro hac vice application pending)
Jaimie N. Cavanaugh (CO Bar No. 44639) (pro hac vice application pending)
MOUNTAIN STATES LEGAL FOUNDATION
2596 South Lewis Way
Lakewood, CO 80227
Telephone: 303-292-2021
Facsimile: 303-292-1980
lechner@mountainstateslegal.com
jcavanaugh@mountainstateslegal.com

Attorneys for Amicus Curiae California Independent Petroleum Association

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF CALIFORNIA
SAN JOSE DIVISION
CENTER FOR BIOLOGICAL DIVERSITY
and SIERRA CLUB,
Plaintiffs,
vs.
THE BUREAU OF LAND MANAGEMENT
and SALLY JEWELL, Secretary of the
Department of the Interior,
Defendants.
Case No.: CV-11-06174-PSG
BRIEF OF AMI CUS CURI AE
CALIFORNIA INDEPENDENT
PETROLEUM ASSOCIATION
REGARDING REMEDY
Hearing Date: August 6, 2013
Time: 10:00 a.m.
The Honorable Paul S. Grewal

Case5:11-cv-06174-PSG Document59-1 Filed06/25/13 Page1 of 20
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TABLE OF CONTENTS

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INTRODUCTION .......................................................................................................................... 1
IDENTITY AND INTEREST OF AMICUS CURIAE .................................................................. 2
ARGUMENT .................................................................................................................................. 3
I. VACATUR IS NOT REQUIRED TO CORRECT THE BLMS PROCEDURAL
ERRORS ............................................................................................................................. 3
A. Remand Does Not Require Vacatur ........................................................................ 3
B. This Court Retains Equitable Powers To Craft An Appropriate Remedy
That Will Protect Plaintiffs And Lessees Rights .................................................. 5
C. Lessees Must Be Joined As Parties Before Their Leases May Be
Invalidated ............................................................................................................... 7
II. CBD HAS NOT SHOWN THAT INJUNCTIVE RELIEF IS PROPER ........................... 8
CONCLUSION ............................................................................................................................. 13
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TABLE OF AUTHORITIES

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CASES
Allied-Signal, Inc. v. U.S. Nuclear Regulatory Commn,
988 F.2d 146 (D.C. Cir. 1993) .................................................................................................. 3
Amoco Prod. Co. v. Village of Gambell,
480 U.S. 531 (1987) ................................................................................................................ 13
California Communities Against Toxics v. EPA,
688 F.3d 989 (9th Cir. 2012) ................................................................................................. 3, 4
Center for Biological Diversity v. Bureau of Land Mgmt.,
2013 WL 1405938 (N.D. Cal. 2013)......................................................................................... 1
Center for Food Safety v. Vilsack,
636 F.3d 1166 (9th Cir. 2011) ............................................................................................ 8, 10
Charlton v. Estate of Charlton,
841 F.2d 988 (9th Cir. 1988) ............................................................................................. 10, 13
Connor v. Burford,
848 F.2d 1441 (9th Cir. 1988) ................................................................................................... 7
Foster v. United States,
607 F.2d 943 (Ct. Cl. 1979) .................................................................................................... 13
Granny Goose Foods, Inc. v. Teamsters,
415 U.S. 423 (1974) ................................................................................................................ 10
Humane Socy v. Locke,
626 F.3d 1040 (9th Cir. 2010) ................................................................................................... 3
Idaho Farm Bureau Fedn v. Babbitt,
58 F.3d 1392 (9th Cir. 1995) ..................................................................................................... 3
Kettle Range Conservation Group v. BLM,
150 F.3d 1083 (9th Cir. 1998) ................................................................................................... 7
Lemmons v. United States,
496 F.2d 864 (Ct. Cl. 1974) ...................................................................................................... 7
Los Angeles v. Lyons,
461 U.S. 95 (1983) .................................................................................................................. 10
Los Angeles Memorial Coliseum Commn v. Natl Football League,
634 F.2d 1197 (9th Cir. 1980) ........................................................................................... 8, 10
Lujan v. Defenders of Wildlife,
504 U.S. 555 (1992) ................................................................................................................. 8
Mazurek v. Armstrong,
520 U.S. 968 (1995) .................................................................................................................. 8
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(continued)
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AMICUS BRIEF OF CALIFORNIA INDEPENDENT PETROLEUM ASSOCIATION RE REMEDY

Monsanto Co. v. Geertson Seed Farms,
130 S. Ct. 2743 (2010) ................................................................................................... 8, 10-11
Metro. Edison Co. v. People Against Nuclear Energy,
460 U.S. 766 (1983) ........................................................................................................ 8, 9, 11
Montana Wilderness Assn v. Fry,
310 F. Supp. 2d 1127 (D. Mont. 2004) ..................................................................................... 6
Montana Wilderness Assn v. Fry,
408 F. Supp. 2d 1032 (D. Mont. 2006) ..................................................................................... 6
Munaf v. Geren,
553 U.S. 674 (2008) .................................................................................................................. 8
Natl Wildlife Fedn v. Espy,
45 F.3d 1337 (9th Cir. 1995) ..................................................................................................... 5
Northern Cheyenne Tribe v. Hodel,
851 F.2d 1152 (9th Cir. 1988) ................................................................................................... 6
OShea v. Littleton,
414 U.S. 488 (1974) ................................................................................................................ 10
Pit River Tribe v. U.S. Forest Serv.,
615 F.3d 1069 (9th Cir. 2010) ............................................................................................... 3, 6
Professional Plan Examiners of New Jersey, Inc. v. Lefante,
750 F.2d 282 (3d Cir. 1984) .................................................................................................... 10
Sierra Forest Legacy v. Sherman,
2013 WL 1627894 (E.D. Cal. 2013) ......................................................................................... 3
Sierra Pacific Industries v. Lyng,
866 F.2d 1099 (9th Cir. 1989) ................................................................................................... 5
Sinclair Broad. Group, Inc. v. FCC,
284 F.3d 148 (D.C. Cir. 2002) .................................................................................................. 5
Sun Oil Co. v. United States,
572 F.2d 786 (Ct. Cl. 1978) (per curiam) ................................................................................. 7
Union Oil Co. of California v. Morton,
512 F.2d 743 (9th Cir. 1975) ............................................................................................... 4, 13
United Food & Commercial Workers Local 99 v. Bennett,
2013 WL 1289781 (D. Ariz. 2013) ......................................................................................... 10
United States v. W.T. Grant Co.,
345 U.S. 629 (1953) .................................................................................................................. 8
Western Oil & Gas Assn v. EPA,
633 F.2d 803 (9th Cir. 1980) ................................................................................................. 3, 4
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Western Watersheds Project v. Abbey,
2013 W: 2532617 (9th Cir. 2013) ............................................................................................. 8
Western Watersheds Project v. Salazar,
4:08-CV-516-BLW, 2012 WL 5880658 (D. Idaho Nov. 20, 2012) ....................................... 11
Westlands Water Dist. v. Firebaugh Canal,
10 F.3d 667 (9th Cir. 1993) ....................................................................................................... 5
Winter v. Natural Res. Def. Council,
555 U.S. 7 (2008) .................................................................................................................. 8, 9

CONSTITUTION, STATUTES & RULES
U.S. Const. amend. V ................................................................................................................ 4, 13
5 U.S.C. 701-706 .......................................................................................................................... 1
5 U.S.C. 706(2)(A) ....................................................................................................................... 3
5 U.S.C. 3103.4 ............................................................................................................................ 6
5 U.S.C. 3108.5 ............................................................................................................................ 6
43 C.F.R. 3101.1-2 ....................................................................................................................... 8
Fed. R. Civ. P. 19 ............................................................................................................................ 8
Fed. R. Civ. P. 19(a)(1)(B)(i) .......................................................................................................... 7
Fed. R. Civ. P. 65 .......................................................................................................................... 10

OTHER AUTHORITIES
Daniel Mach, Rules Without Reasons: The Diminishing Role of Statutory Policy And
Equitable Discretion in the Law of NEPA Remedies, 35 Harv. Envtl. L. Rev. 205
(2011) ........................................................................................................................................ 4
Evan J. House, Fractured Fairytales: The Failed Social License For Unconventional Oil
And Gas Development, 13 Wyo. L. Rev. 5 (2013) ................................................................. 12
Nabil El Shaari, W.A. Minner, & R.F. LaFolette, Is There a Silver Bullet Technique for
Stimulating Californias Monterey Shale?, Socy of Petroleum Engrs 144526 (2011). ....... 12
U.S. Dept. of Interior, Bureau of Land Management, Results of September 14, 2011
Competitive Oil & Gas Lease Sale,
www.blm.gov/pgdata/etc/medialib/blm/ca/pdf/pa/energy/minerals.Par.12743.File.dat/
9-14-11%20Oil%20&%20Gas%20Sale%20Results.pdf .......................................................... 5
U.S. EPA, Evaluation of Impacts to Underground Sources of Drinking Water By
Hydraulic Fracturing of Coalbed Methane Reservoirs, EPA 816-R-04-003
(June 2004), www.epa.gov/ogwdw/uic/pdfs/cbmstudy_attach_uic_ch04_hyd_frac_
fluids.pdf ................................................................................................................................. 11
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U.S. EPA, PRESS RELEASE, Wyoming to Lead Further Investigation of Water Quality
Concerns Outside of Pavillion with Support of EPA (June 20, 2013) .................................... 12
United States Geological Survey, Timothy M. Kresse, et al., Shallow Groundwater
Quality and Geochemistry in the Fayetteville Shale Gas-Production Area, North-
Central Arkansas, 2011, Scientific Investigations Report 2012-5273 (2012) ....................... 11

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INTRODUCTION
The Bureau of Land Management (BLM) auctioned and sold four oil and gas leases on
approximately 2,700 acres of land in Fresno and Monterey Counties as part of a lease sale on
September 14, 2011, and a subsequent over the counter sale. Center for Biological Diversity v.
Bureau of Land Mgmt., 2013 WL 1405938, 12 (N.D. Cal. 2013); Dkt #45. The two leases in
Fresno County contain a No Surface Occupancy (NSO) stipulation, which precludes the lessee
from occupying the surface of the leased area without additional specific authorization from the
BLM. Id. at 1213. The two leases in Monterey County do not contain the NSO stipulation. Id.
Plaintiffs, the Center for Biological Diversity and Sierra Club (collectively CBD),
brought this action against the BLM and Sally Jewell, Secretary of the Interior, (collectively
BLM) for declaratory and injunctive relief under the Administrative Procedure Act (APA).
5 U.S.C. 701706. The BLM and the CBD both sought summary judgment and this Court
granted the CBDs motion, in part, holding that the BLM violated the National Environmental
Policy Act (NEPA) when it issued the two non-NSO leases in Monterey County without first
considering the potential environmental effects of hydraulic fracturing (fracturing). Dkt. #45 at
1.
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This Court found that the BLMs environmental assessment (EA) and subsequent finding of
no significant impact (FONSI) were erroneous as a matter of law as to those two leases. Id.
This Court then asked the parties to meet and confer and submit a mutually agreeable remedy. Id.
at 28. The parties were unable to agree on an appropriate remedy, prompting this Court to request
briefing and set a hearing on the issue. Dkt #52; Dkt. #54.
On June 3, 2013, in accordance with this Courts briefing schedule, CBD filed its Opening
Brief Re Remedy. Dkt. #55. CBD asks that this Court vacate the EA, the FONSI, and the two
Monterey County leases. Id. at 7. In the alternative, CBD asks this Court to permanently enjoin
all oil and gas activities on the Monterey County leases until the BLM complies with NEPA. Id.
at 1519.

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As demonstrated below, the most appropriate remedy in the case is to remand the EA and
FONSI to the agency in regard to the two non-NSO leases. This Court may also want to suggest
that the BLM suspend the two Monterey leases pending the BLMs compliance with NEPA.
IDENTITY AND INTEREST OF AMICUS CURIAE
The California Independent Petroleum Association (CIPA) has already participated as
an amicus curiae in this case and submitted a brief supporting the BLMs motion for summary
judgment. Dkt #36-2. CIPA is a non-profit, non-partisan trade association representing
approximately 450 independent crude oil and natural gas producers, royalty owners, and service
and supply companies operating in California. CIPA members are involved in all aspects of oil
and gas exploration, production, marketing, and transportation, including the drilling and
operation of wells on federal mineral estates managed by the BLM throughout California. CIPA
educates the public and elected officials regarding many aspects of the oil and gas industry and
frequently weighs in on legislative and regulatory issues affecting its members.
CIPA members are subject to extensive federal, state, and local regulations throughout all
stages of operations. CIPA members frequently acquire and develop oil and gas leases covering
federal mineral estates managed by the BLM and therefore have a strong interest in ensuring that
analysis prepared pursuant to NEPA is efficiently and accurately completed. CIPA members also
have an interest in ensuring that any conditions or stipulations placed in federal leases are
reasonable; reflect technical and economic realities; and that they appropriately reflect that the
suitable mitigation and equipment to be employed at a given well depends on a number of factors.
CIPA members also have an interest in ensuring that their valuable property interests in federal
oil and gas leases are not unnecessarily extinguished. CIPA is an appropriate organization to
submit this amicus curiae brief, and it appreciates the opportunity to provide the Court with
guidance on the appropriate remedy for this case.
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ARGUMENT
I. VACATUR IS NOT REQUIRED TO CORRECT THE BLMS PROCEDURAL
ERRORS.
A. Remand Does Not Require Vacatur
Although the APA provides that the reviewing court shall hold unlawful; and set aside
agency action, findings, and conclusions found to be arbitrary, capricious, an abuse of
discretion or otherwise not in accordance with law, 5 U.S.C. 706(2)(A), courts have not
interpreted set aside to command vacatur on every occasion. See Sierra Forest Legacy v.
Sherman, 2013 WL 1627894, *2 (E.D. Cal. 2013) (It is well established in this Circuit that a
Court is not mechanically obligated to vacate an agency decision that it finds invalid.) (citing
Humane Socy v. Locke, 626 F.3d 1040, 1053 n.7 (9th Cir. 2010) (stating that a court may remand
without vacatur to allow the agency action to remain in force until the action can be considered or
replaced); Pit River Tribe v. U.S. Forest Serv., 615 F.3d 1069, 108081 (9th Cir. 2010) (Our
courts have long held that relief for a NEPA violation is subject to equity principles.); Idaho
Farm Bureau Fedn v. Babbitt, 58 F.3d 1392, 1405 (9th Cir. 1995) (when equity demands, the
regulation can be left in place while the agency follows the necessary procedures.); Western Oil
& Gas Assn v. EPA, 633 F.2d 803, 813 (9th Cir. 1980) (guided by authorities that recognize that
a reviewing court has discretion to shape an equitable remedy, we leave the challenged
designations in effect.). In deciding whether vacatur is appropriate courts must consider the
seriousness of the agencys errors and the disruptive consequences of an interim change that
may itself be changed. California Communities Against Toxics v. EPA, 688 F.3d 989, 992 (9th
Cir. 2012) (California Communities) (quoting Allied-Signal, Inc. v. U.S. Nuclear Regulatory
Commn, 988 F.2d 146, 150-151 (D.C. Cir. 1993)).
CBD argues that this Court has no choice under the APA but to vacate the BLMs EA and
FONSI as well as the two Monterey County leases. Dkt. #55 at 2-3. However, numerous Ninth
Circuit opinions provide that vacatur is not required when agencies violate procedural statutes
such as NEPA. See Sierra Forest Legacy v. Sherman, 2013 WL 1627894 at *2; Humane Socy v.
Locke, 626 F.3d at 1053 n. 7; Pit River Tribe, 615 F.3d at 108081 Idaho Farm Bureau Fedn, 58
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F.3d at 1405; Western Oil & Gas Assn, 633 F.2d at 813. More importantly, vacating the leases at
issue in this case would unconstitutionally deprive lessees of their property interests. U.S. Const.
amend. V (No person shall be deprived of life, liberty, or property, without due process of
law.); Union Oil Co. of Cal. v. Morton, 512 F.2d 743, 747 (9th Cir. 1975) (Providing that oil and
gas leases convey property interests enforceable against the government, even if such interests
lack many attributes of private property.). Therefore, vacatur of the leases would be improper and
unlawful.
Vacatur is further unwarranted under the two-step test applied in California Communities.
First, this Court must review the seriousness of the BLMs errors. California Communities, 688
F.3d at 992. Here, this Court concluded that the BLM violated NEPA by not fully considering the
environmental effects of fracturing before issuing the two Monterey County leases. Dkt. #45 at
24. NEPA, however, is simply a procedural statute designed to foster informed decision-making,
and it does not impose any substantive requirements. Robertson v. Methow Valley Citizens
Council, 490 U.S. 332, 351 (1989). It is unknown whether the lessees will produce hydrocarbons
from these leases or whether lessees will engage in fracturing on the leases. In any event, no
drilling or fracturing may occur until the lessees apply for an Application for Permit to Drill
(APD) from the BLM and the BLM approves it. The BLM thus retains a future opportunity to
review the activities planned for these oil and gas leases and ensure that the lessees comply with
all applicable environmental regulations. The BLMs decision not to address the potential impacts
of fracturing before it is known whether fracturing will take place on a particular parcel shows an
awareness of the agencys limited resources. Engaging in a lengthy and costly assessment of the
possible environmental effects of fracturing would not be the best use of the agencys limited
resources, since the agency cannot be sure if any private parties will engage in fracturing on these
parcels.
Second, this Court must consider the disruptive consequences of vacating the leases. See
California Communities, 688 F.3d at 992. Vacatur would improperly deprive lessees of their
property interest in the leases and would cause needless uncertainty for lessees. If the BLM
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corrects its errors under NEPA and finds that its original assessment was correct, lessees would
be forced to go through the competitive bid process once again. Lessees have already paid for
their leases, and the BLM has issued them.
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Vacating these leases would destroy the lessees
private property interests and could force them to bid on the same parcels again in the future
without a guarantee that they would be the successful bidder. Therefore, vacatur is both improper
and inequitable as applied to the facts of this case.

B. This Court Retains Equitable Powers To Craft An Appropriate Remedy That
Will Protect Plaintiffs And Lessees Rights

Despite the text of the APA, which directs courts to set aside actions that are arbitrary,
capricious, an abuse of discretion or otherwise not in accordance with law, 5 U.S.C. 706(2)(A),
court have continued to order equitable remedies based on the facts of cases brought under the
APA. See Natl Wildlife Fedn v. Espy, 45 F.3d 1337, 1343 (9th Cir. 1995) (The courts decision
to grant or deny injunctive or declaratory relief under APA is controlled by principles of equity.)
(citing Westlands Water Dist. v. Firebaugh Canal, 10 F.3d 667, 679 (9th Cir. 1993)); Sierra
Pacific Industries v. Lyng, 866 F.2d 1099, 1111 (9th Cir. 1989); see also Daniel Mach, Rules
Without Reasons: The Diminishing Role of Statutory Policy And Equitable Discretion in the Law
of NEPA Remedies, 35 Harv. Envtl. L. Rev. 205, 218 (2011) (The statutory remedies provided
by NEPA and the APA have been applied with a surprising degree of flexibility. The
discretionary authority that courts have assumed in tailoring statutory relief to particular cases is
illustrated by the fact that some courts have declined even to explain their decision not to vacate
the agency action found to violate NEPA.) (citing Sinclair Broad. Group, Inc. v. FCC, 284 F.3d

2
Parcel 9-11-2 was purchased at the lease sale for $52,740.00. U.S. Dept. of Interior, Bureau of
Land Management, Results of September 14, 2011 Competitive Oil & Gas Lease Sale,
www.blm.gov/pgdata/etc/medialib/blm/ca/pdf/pa/energy/minerals.Par.12743.File.dat/9-14-
11%20Oil%20&%20Gas%20Sale%20Results.pdf. Parcel 9-11-1 was purchased at an over-the-
counter sale on Septmber 20, 2011, for an undisclosed amount. Dkt. # 45 at 12.

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148 (D.C. Cir. 2002)). Indeed, this Court has already stated that the proper remedy should aim to
approximate what would have happened had the agencies used the proper procedures at the time
of the lease sale. Dkt. #45 at 28 (citing Pit River Tribe, 615 F.3d at 1084).When considering
similar NEPA violations by federal agencies, other courts have exercised their discretion to
suspend leases instead of vacating them. See N. Cheyenne Tribe v. Hodel, 851 F.2d 1152, 1157
(9th Cir. 1988) (Upholding the district courts decision to suspend instead of void leases because
plaintiffs failed to demonstrate any significant difference between voiding and suspending the
leases.); Mont. Wilderness Assn v. Fry, 408 F. Supp. 2d 1032, 1038-39 (D. Mont. 2006)
(suspending leases pending BLMs compliance with NEPA on remand); Mont. Wilderness Assn
v. Fry, 310 F. Supp. 2d 1127, 1156 (D. Mont. 2004) (enjoining surface disturbing activity on
federal leases pending results of an evidentiary hearing on injunctive relief).
The relief demanded by equity in the instant case is remand to the agency. The BLM
should have an opportunity to correct its errors under NEPA; and the leases that have already
been issued should not be vacated. Under the Ninth Circuits guidance in N. Cheyenne Tribe, this
Court should simply suggest that the BLM suspend the leases until the BLM completes the
requisite NEPA review. 851 F.2d 1152; see 43 C.F.R. 3108.5 (suspension of lease rights) ;43
C.F.R. 3103.4-4 (suspension of operations). CBD argues that vacating the leases is necessary to
protect the environment; however, federal leases do not constitute a green light for lessees to drill
and/or facture in any way they would like with no regard for environmental regulations. As this
Court acknowledged, lessees must still apply for an APD and get BLM approval before they are
able to begin any exploration activities. Dkt. #45 at 16. The lessees constitutionally protected
property interests in their leases outweigh CBDs speculative interest in preventing possible
environmental harm. Thus, if this Court attempts to approximate the results that would have been
achieved had the BLM complied with NEPA before holding the lease sale, it should allow the
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vested property interests of lessees to stand and it should not vacate the two Monterey County
leases.
C. The Lessees Must Be Joined As Parties Before Their Leases May Be
Invalidated
CBD has still not explained how due process would allow this Court to invalidate the two
Monterey County leases when the lessees are not parties to this suit. Dkt. #45 at 28 (Although
Plaintiffs request that the court invalidate the lease sale, they provide no authority establishing
this courts authority to do so while the lessees stand absent from this suit.); see Connor v.
Burford, 848 F.2d 1441, 1461 (9th Cir. 1988) (refusing to cancel leases owned by non-parties).
Indeed, joinder of the lessees is required before the leases can be vacated. Kettle Range
Conservation Group v. BLM, 150 F.3d 1083 at 1087 (9th Cir. 1998). The Federal Rules of Civil
Procedure clarify that a person or party must be joined if disposing of the action in the persons
absence may as a practical matter impair or impede the persons ability to protect the interest.
Fed. R. Civ. P. 19(a)(1)(B)(i).
In Kettle Range, the BLM entered into a land exchange with private parties despite
objections from conservation groups and the Washington Department of Fish and Wildlife and
from conservation groups. Id. at 108485. Although the district court eventually ruled in favor of
the conservation groups, it declined to rescind the contract, noting that [plaintiffs] had made no
attempt to join the private parties who, by that time, had taken title to the land. Without their
appearance, the court reasoned, it could not equitably rescind the contract. Id. at 1086. On
appeal, the Ninth Circuit upheld the district courts actions, providing that the district court
correctly determined that it was without authority to rescind the contract in the absence of joinder
of the private parties. Id. at 1087.
The owners of the Monterey County leases have protected property interests in their
leases. These lessees also have a contractual relationship with the BLM, one that cannot be
terminated without first joining lessees in this litigation. See Sun Oil Co. v. United States, 572
F.2d 786, 818 (Ct. Cl. 1978) (per curiam); see also Lemmons v. United States, 496 F.2d 864, 873
(Ct. Cl. 1974) (federal leasehold interest is property, the taking of which entitles the leaseholder
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to just compensation for the value thereof.). As necessary and indispensable parties, the lessees
must be afforded the opportunity to protect their property interests in their federal oil and gas
leases. See Fed. R. Civ. P. 19. Therefore, if this Court considers invalidating the leases despite
CBDs failure to show that it is entitled to vacatur, the lessees must be joined under Rule 19.
II. CBD HAS NOT SHOWN THAT INJUNCTIVE RELIEF IS PROPER.

Injunctive relief is an extraordinary and drastic remedy that is never awarded as of
right. Munaf v. Geren, 553 U.S. 674, 689-90 (2008) (internal citations and quotations omitted);
see also Mazurek v. Armstrong, 520 U.S. 968, 972 (1995) (It frequently is observed that a
preliminary injunction is an extraordinary and drastic remedy, one that should not be granted
unless the movant, by a clear showing, carries the burden of persuasion.) (emphasis original).
To obtain this extraordinary and drastic remedy, a plaintiff must make a clear showing that [it]
is entitled to such relief. Winter v. Natural Res. Def. Council, 555 U.S. 7, 22 (2008). To make
such a showing, a plaintiff must prove with compelling evidence that: (1) it is likely to suffer
irreparable harm in the absence of the requested relief; (2) that the balance of hardships tips in its
favor; and (3) the requested relief would not disserve the public interest. Monsanto Co. v.
Geertson Seed Farms, 130 S. Ct. 2743, 275657 (2010); W. Watersheds Project v. Abbey, 2013
WL 2532617, *15 (9th Cir. 2013) (citing Winter, 555 U.S. at 32).
It is also well established that proof of Article III injury does not prove a likelihood of
irreparable harm for injunctive relief. Los Angeles Memorial Coliseum Commn v. Natl Football
League, 634 F.2d 1197, 1201 (9th Cir. 1980); Ctr. for Food Safety v. Vilsack, 636 F.3d 1166,
1171 n.6 (9th Cir. 2011). The purpose of injunctive relief is to prevent future harms rather than to
remedy past harms. See United States v. W.T. Grant Co., 345 U.S. 629, 633 (1953); Lujan v.
Defenders of Wildlife, 504 U.S. 555, 564 (1992) (Past exposure to illegal conduct does not in
itself show a present case or controversy regarding injunctive relief . . . if unaccompanied by any
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continuing, present adverse effects.). Likewise, it is well established that the fear of harm is not
cognizable. Metro. Edison Co. v. People Against Nuclear Energy, 460 U.S. 766, 775 (1983)
([R]isk of an accident is not an effect on the physical environment. A risk is, by definition,
unrealized in the physical world.); id. at 776 ([C]ontentions of psychological health damage
caused by risk [are not] cognizable under NEPA.).
In Winter, environmental groups challenged the Navys use of mid-frequency active sonar
off the coast of southern California. 555 U.S. at 13. The plaintiffs argued that the sonar could
cause serious injuries to marine mammals and that the Navys actions violated the Marine
Mammal Protection Act and NEPA. Before beginning training, the Navy released an EA
expressing its belief that the training would not have a significant impact on the environment.
Winter, 555 U.S. at 16. The district court granted the plaintiffs motion for preliminary injunctive
relief based upon the fact that plaintiffs had demonstrated a probability of success on their
claims. Id. at 17 (internal quotations omitted). The Ninth Circuit agreed that preliminary
injunctive relief was appropriate; however, it disagreed with the breadth of the district courts
preliminary injunction. Id. On remand, the district court entered a new preliminary injunction
with a more limited scope. Id. at 1718.
On appeal, the Ninth Circuit again upheld the preliminary injunction. Id. at 19. More
specifically, the Ninth Circuit found that the plaintiffs had carried their burden of establishing a
possibility of irreparable injury and noted that the preliminary injunction issued by the district
court struck a proper balance between the competing interests at stake. Id. at 1920. The
Supreme Court then granted certiorari, reversed the Ninth Circuit and vacated the injunction. Id.
at 20. The Supreme Court reiterated that a plaintiff is not entitled to a preliminary injunction
based on the mere possibility of irreparable harm and rejected the idea that the possibility of a
stochastic event could ever constitute the likelihood of irreparable harm:
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Our frequently reiterated standard requires plaintiffs seeking preliminary relief to
demonstrate that irreparable injury is likely in the absence of an injunction. Issuing
a preliminary injunction based only on a possibility of irreparable harm is
inconsistent with our characterization of injunctive relief as an extraordinary
remedy that may only be awarded upon a clear showing that the plaintiff is entitled
to such relief.
555 U.S. at 22 (emphasis in original) (citing Los Angeles v. Lyons, 461 U.S. 95, 103 (1983));
Granny Goose Foods, Inc. v. Teamsters, 415 U.S. 423, 441 (1974); OShea v. Littleton, 414 U.S.
488, 502 (1974) ([A] preliminary injunction will not be issued simply to prevent the possibility
of some remote future injury.).
Finally, injunctive relief may not be granted in the absence of an evidentiary hearing
unless: (1) the facts are not in dispute, or (2) the parties waive their rights to such hearings. See
United Food & Commercial Workers Local 99 v. Bennett, 2013 WL 1289781, *10 (D. Ariz.
2013) (citing Charlton v. Estate of Charlton, 841 F.2d 988, 989 (9th Cir. 1988) (district court
improperly denied an evidentiary hearing before it issued an injunction because the entry or
continuation of an injunction requires a hearing. Only when the facts are not in dispute, or when
the adverse party has waived its right to a hearing, can that significant procedural step be
eliminated) (citing Professional Plan Examiners of New Jersey, Inc. v. Lefante, 750 F.2d 282,
288 (3d Cir. 1984)); see also Fed. R. Civ. P. 65.
In the instant case, CBD is not entitled to an injunction as of right. CBD has offered no
evidence of irreparable harm. Dkt. #55 at 11. The injuries alleged within the declarations supplied
by the CBD provide that the BLMs violations of NEPA may affect water quality and quantity
in the region, and that fluids used during fracturing might linger in underground formations.
Anderson Decl. 16, Dkt. #28.1; Craig Decl. 12, Dkt. #28.2. The CBD further alleges that, as a
result of the BLMs procedural errors under NEPA, it is likely to suffer injuries. Dkt. #55 at
11. Speculative injuries arising under a procedural statute cannot prove a likelihood of irreparable
harm for injunctive relief. See Los Angeles Memorial Coliseum Commn v. Natl Football
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League, 634 F.2d at 1201; Ctr. for Food Safety, 636 F.3d at 1171 n.6. Furthermore, violations of
a procedural statute, such as NEPA, rarely prove irreparable harm. See Monsanto, 130 S.Ct. at
2757-61.
An additional CBD declaration states member is deeply concerned about the potential
impacts to certain bodies of water. Shimek Decl. 6, Dkt. #28.4. This member claims that he
would not feel safe kayaking if the two Monterey County leases are developed. Id. However,
the Supreme Court has made clear that fear is too subjective to be considered a cognizable injury
and that subjective feelings cannot establish proof of injury. See Metro. Edison Co., 460 U.S. at
775; Metcalf v. Natl Petroleum Council, 553 F.2d 176, 187-89 (D.C. Cir. 1977).
That the complained of injuries are too speculative to prove irreparable harm is further
supported by the lack of evidence showing that an APD has been submitted for either of the
Monterey County leases. Although the BLM generally may not deny a lessee the right to drill on
a non-NSO lease (see Dkt. #45 at 16), the BLM retains authority to impose restrictions within an
APD. Dkt. #45 at 16. Without an approved APD, there can be no threat of irreparable harm. W.
Watersheds Project v. Salazar, 4:08-CV-516-BLW, 2012 WL 5880658 *6 (D. Idaho Nov. 20,
2012) (no threat of irreparable harm from two proposed drilling projects for which the NEPA
process had not been completed). This is especially true when any APD would be subject to an
additional NEPA review. Monsanto, 130 S.Ct. at 275762 (pending and future proposals,
especially ones that will be subject to NEPA, cannot create a likelihood of irreparable harm
requiring injunctive relief). The CBD has failed to cite any post-Monsanto cases supporting their
contention of irreparable harm or providing that the BLMs procedural violations warrant
injunctive relief.
Even if an APD were approved, any harm from hydraulic fracturing is pure speculation.
See United States Geological Survey, Timothy M. Kresse, et al., Shallow Groundwater Quality
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and Geochemistry in the Fayetteville Shale Gas-Production Area, North-Central Arkansas, 2011,
Scientific Investigations Report 2012-5273 (2012) (Results indicate water quality surrounding oil
and gas production in Fayetteville Shale has not been effected by gas-production activities); U.S.
EPA, PRESS RELEASE, Wyoming to Lead Further Investigation of Water Quality Concerns
Outside of Pavillion with Support of EPA (June 20, 2013) (EPA defers to State of Wyoming in
investigation concerning groundwater contamination near oil and gas wells.); see also Evan J.
House, Fractured Fairytales: The Failed Social License For Unconventional Oil And Gas
Development, 13 Wyo. L. Rev. 5 (2013) (Discussing the information gap between industry, the
public, media, and regulators.). Moreover, CBDs unsubstantiated fears of hydraulic fracturing in
the Monterey Shale overlook this Shales unique geological conditions. The EPA itself has
estimated that fracturing is used in about 20% of wells drilled in the Monterey Shale. AR 1039. It
is unknown if these leases will ever produce any oil; however, in the event that wells are drilled,
the present data indicates that fracturing would only be used at one out of five wells. Id. In many
areas within the Monterey Shale, conventional hydraulic fracture placement can be challenging,
due to the combination of stress state and natural fracture planes that complicate fracture
geometry and leakoff by opening under fracturing conditions. Nabil El Shaari, W.A. Minner, &
R.F. LaFolette, Is There a Silver Bullet Technique for Stimulating Californias Monterey
Shale?, Socy of Petroleum Engrs 144526 (2011). Without further explaining the technical
requirements for fracturing, it is clear that lessees must investigate their individual parcels to
determine the most effective methods of recovery for each site. As a result, CBDs allegations of
future, irreparable harm are far too speculative to warrant injunctive relief.
CBD is also unable to prove that the balance of hardships tips in its favor. In order to do
so, CBD must show with certainty that groundwater contamination or other environmental
degradation will occur as a result of fracturing. Once again, neither CBD nor any federal agency
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has proven that such injury will occur as a result of fracturing. In fact, the debate about what, if
any, potential effects fracturing will have on the environment is a question of fact that this Court
is not able to decide without holding an evidentiary hearing as required by Charlton. 841 F.2d at
989.
Lastly, the CBD has failed to prove that leaving the leases in tact would disserve the
public interest. Because private parties have already purchased these leases, vacating the leases at
this point would unconstitutionally deprive lessees of their property interests. U.S. Const.
amend. V; Union Oil Co. of Cal., 512 F.2d at 747 (Providing that oil and gas leases convey
property interests enforceable against the government, even if such interests lack many attributes
of private property); Foster v. United States, 607 F.2d 943, 949 (Ct. Cl. 1979) (Holding that a
leasehold interest in mineral rights is an estate in real property and as such can be compensable
under the takings clause). While CBD asserts, without support, that cancelling the leases serves
the public interest by preventing contamination of groundwater and by protecting air quality, it
dismisses the other, very real public interests involved in issuing oil and gas leases. The public
has an interest in an affordable supply of oil and gas that is produced domestically. See generally
Amoco Prod. Co. v. Village of Gambell, 480 U.S. 531, 545-46 (1987) (mineral development
policy embodied in the Outer Continental Shelf Lands Act reflected the public interest). The
public also has an interest in the jobs created by domestic energy production. Finally, the public
has an interest in the reliability of federal leases. Federal agencies, industries, and individuals
benefit from the leasing of federal lands. However, if the BLM or other agencies are granted wide
powers to cancel otherwise valid leases, without the input of the lessees injured by such
cancellations, the resulting loss of confidence in federal leases would reduce agency revenues and
leave public lands vacant and unproductive. CBD has not shown that their unfounded concerns
about speculative injuries outweigh the important public interests at issue in this case.
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CONCLUSION
CBD has not satisfied its heavy burden of proof and is not entitled to vacatur or injunctive
relief. Therefore, this Court should allow the BLM to address the defects, identified by this Court
in its decision on the merits, in the EA and the FONSI regarding the two non-NSO leases. This
Court may also wish to suggest that the BLM suspend the two non-NSO leases pending the
BLMs compliance with NEPA. In no event shall vacatur or a permanent injunction be
considered absent joinder of the lessees.
Respectfully submitted this 25th day of June, 2013

By: s/Benjamin G. Shatz
MANATT, PHELPS & PHILLIPS, LLP

Steven J. Lechner
Jamie N. Cavanaugh
MOUNTAIN STATES LEGAL FOUNDATION
Attorneys for Amicus Curiae
California Independent Petroleum Association

309403828.1

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