Articles Posted in Environmental

On October 10, the U.S. Court of Appeals for the Sixth Circuit issued an opinion affirming the conviction of a “land man” for the crimes of conspiracy and mail fraud in connection with a scheme to defraud investors he enticed to invest in plan to mine “blue gem coal.” The case is U.S. v. Phillips.

According to the Court of Appeals “[l]and men scout rural property for coal mining potential and negotiate leases with the landowners to mine it.” As a land man, the Mr. Phillips’ job was to search for rural properties with coal mining potential, and then to negotiate leases with the landowners. According to the Court of Appeals, blue gem coal is a very valuable commodity, but applicable state and federal environmental regulations make it difficult to mine.

New Century Coal, the company that employed Mr. Phillips, purported to own land on which valuable deposits of blue gem coal were located, and with the services of a former NASCAR driver, the defendant participated in a plan to defraud investors to invest in the company which did not, in fact, own any such valuable lands.

The Court of Appeals states in its opinion that the company “has swindled more that $14 million from more than 160 investors.” “The government accused twelve people of being in on the scheme. Most of them, including the mastermind, Brian Rose, pleaded guilty. Only Johnny Phillips went to trial. The government charged him with three crimes: conspiring to commit mail and wire fraud, conspiring to launder money, and laundering money.” In his defense, Mr. Phillips argued that he was not aware of the fact that the company had not secured the rights to mine this coal, and that he found nothing suspicious about his accomplices and their use of fake names. The case was argued on October 5, 2017, and decided on October 19, 2017.

On October 11, the U.S. States District Court for the District of Columbia issued its latest ruling on the Dakota Access Pipeline (DAP). The case is Standing Rock Sioux Tribe and Cheyenne River Sioux Tribe v. US Army Corps of Engineers and Dakota Access, LLC. Partial relief was granted by the District Court when it was convinced that the U.S. Army Corps of Engineers’ (Corps of Engineers) Environmental Assessment inadequately addressed the consequences of an oil spill, and certain environmental justice issues.

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Last week, the U.S. Supreme Court heard oral argument in two significant cases: Nat’l Assoc. of Mfr. v. Dep’t of Defense and Jesner v. Arab Bank, PLC.

In National Association of Manufacturers, the Court is being asked to determine which court is authorized to review the recent redefinition of “Waters of the United States” promulgated by the Environmental Protection Agency (EPA) and the U.S. Army Corps of Engineers (Corps of Engineers). The relevant statute is 33 U.S.C. § 1369(b)(1) and (2), and it is notorious for its complex provisions. If jurisdiction lies in the federal district courts, then many lawsuits are likely to be filed in courts throughout the country, creating uncertainty and stretching out the effective date of the new rule. If jurisdiction is limited to the courts of appeal, this should reduce the cost of litigation, but may be contrary to other provisions of the Clean Water Act (CWA).

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On October 3, in the case of Boerschig v. Trans-Pecos Pipeline, LLC, the U.S. Court of Appeals for the Fifth Circuit affirmed the lower court’s denial of request for a preliminary injunction to enjoin Texas state condemnation proceedings initiated by the pipeline defendant because, it was argued, these proceedings violated the Due Process Clause of the U.S. Constitution. The plaintiff landowner argued that the Texas law illegally delegated condemnation authority to a private party (the pipeline company), and that the process failed to provide an opportunity for the plaintiff to participate in a “predeprivation hearing” where the condemnation can be challenged. The Fifth Circuit concluded that the plaintiff was unable to establish a likelihood of success on the merit, a sine qua non for obtaining a preliminary injunction.

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On March 22, during the U.S. Supreme Court’s 2015 Term, the Court issued a unanimous ruling that the Ninth Circuit’s interpretation of the scope of the National Park Service’s authority to ban the use of a hovercraft on Alaska’s Nation River within the Yukon-Charley Rivers National Preserve was erroneous in that it failed to recognize that the Alaska National Interests Lands Conservation Act (ANILCA) had the effect of carving out an exception for the use of hovercraft in these waters that was permitted by Alaska. The petitioner, John Sturgeon, was warned by Park Service Rangers that his use of the hovercraft within the boundaries of the Yukon-Charley preserve was prohibited, and that he was committing a crime by doing so. After reviewing ANILCA and the different laws and accommodations that were enacted to facilitate Alaska’s entry into the Union, the Court concluded that the law “repeatedly recognizes that Alaska is different,” and the judgment of the Ninth Circuit was vacated, and remanded for further proceedings. This was the only issue decided by the Court, whose decision is reported as Sturgeon v. Frost.

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The Federal Energy Regulatory Commission’s (FERC) decision in the matter of Millennium Pipeline Company, LLC was issued on September 15, 2017. FERC determined that the New York State Department of Environmental Conservation (NYDEC) waived its right to act on a state Clean Water Act (CWA) 401 water qualification by failing to act before the statutory deadlines established by the CWA, 33 U.S.C. § 1341(a)(1), expired. This certification, required of most pipeline applications under the Natural Gas Act (NGA), provides that the State must act on a request for certification “within a reasonable time (which shall not exceed one year) after receipt of such request,” or “the certification requirements of this subsection shall be waived with respect to such Federal application.”

According to FERC, Millennium’s application was received by the NYDEC on November 23, 2015, and NYDEC was required by law to make its certification decision by November 23, 2016 and at least this obstacle to the construction of the “Valley Lateral Project” in Orange, NY has been surmounted.

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