good morning your honor as i'd like to reserve three minutes you may is not the biggest case you're going to hear today in terms of the damages this is a small farmer up in southern lower michigan but it's important to thousands even tens of thousands of farmers throughout the country humility of lee most of this wasn't soybean and corn farmers are enrolled in these agricultural programs the the in rule to reduce risk to volatility in to ensure a stable food supply but the deal has changed until this administration not two thousand and nine generally there was a fairly cooperated relationship between farmers and the agency in recent years in foresman has really tightened up the definitions of what is a wetland and what is conversion have become much stricter in simultaneously at the same time that the agency is sweeping more conduct into the scope of creativity conduct the exemptions have been systematically narrowed increasingly so that's what's at stake here is how far how far can the agency go in terms of tightening these restrictions in narrowing the exemptions just a few seconds on the facts the facts are different from the cases that you may have read district courts have focused on whether or not you know is this farmer making something up was this really tiled before nine hundred eighty five here that's not an issue my father found in an old refrigerator  his mother's basement this is the actual conservation plant showing the tiling that was that the u s d a helped design and pay for back in the early one nine hundred sixty s so  so how complicated and burdensome is it to return this to wetlands it would be extinct it would be it would involve driving your tractors around making turns on what are called headland very isolated topographical depression kind of all in the northern of the northern part of the depression they cut a ditch through the northern part in order to drain it and lay tile but it's it's small it's the most it is two point two four acres we claim it's much smaller than that of the standard of review what would it cost to do that i mean just it is that is the problem here losing land that you could farm or is the problem the cost of you know making a wetland again the cost of making it a wetland again is the opportunity cost of not being able to farm it o ne could let the land go and if you don't fix the tile and you don't maintain the land it falls into disrepair and it will naturally evolve into a wetland  at this point we fix the tile we basically unplugged the tile and now it drains again so we're farming it now so mitigation that's restoration mitigation is a slightly different concept that's where you take other productive farmland and you impose a conservation easement on it so that it cannot be farmed ever again or developed in the future and mr smith is unwilling to do that and part of the question is whether the they are entitled to impose a mitigation condition as a price of giving you a reduction in penalty or an exemption is that that is a budget issue your honor the district co imposed mitigation is a requirement in two of the three legal issues before you the first is whether or not mitigation is a requirement for this minimal effects analysis and consideration the second is whether mitigation is a requirement for consideration of a reduced penalty under the i'm sorry when you said the district court imposed it isn't the district court upheld the agriculture department imposing those quicklime it's not exactly you idea because the agency never maintained that mitigation was a prerequisite for a minimal effects analysis minimal effects what about for the reduced penalty they have maintained consistently mitigation was a requirement however the director of the national appeals division and i i'm sorry for all the procedural complexities in this case it is a maze but at one point the director of the national appeals division determined that mitigation was not a requirement but but in this particular in this particular case they're imposing it on you the district court is at least and now the agency is  well the agent of i guess i thought that was their position it was in the district court going beyond what they wanted to do and not for that the second of the three questions you're hearing so the the standard the standard of review of course this court reviews issues of law didn't hold on but i just wanted to comment a little bit on the standard review because the agency is all over the map in its brief at one point it claims that the standard of review is due an oval at another point it says that this court must presume is valid and apply a rational basis test to whether the agency action had a rational basis that simply is not the law your honour's i encourage the court to look at motivate the motor vehicles case where it says that the standard of review a rational reason for the agency's action that's far different from a rational basis review if some cons if some legislation were being challenged as a constitutional matter so trying to minimal effects  won't reverse all of the laws it's on page twenty one of our original brief which clearly lays out the requirement that the agency do two things it has to consider are evidence of rational minimal agency says we weren't required to conduct an analysis because you didn't ask until after the fact and so if you come to us after you've already converted then we're not required to do a minimal effects analysis that's simply not the lawyer the lawyer  requested or demanded to do or somehow somehow or other was triggered in our first letter appealing the adverse determination we said we don't believe this is correct because the impact of the activity had only a minimal effect from that point on we raised it consistently in front of the mediation panel and of course throughout the administrative proceedings in the administrative appeals i we if there's some magic words that we have to utter a magic form we have to fill out it was never told to us and it's never been briefed of that we had to do anything besides put it out there and say look we don't think we did anything wrong or had it had minimal effect as your position is  successfully at least raised the issue at an appropriately early time absolutely your honor and as you can tell from the tone of my brief we were very troubled that they were fused even to pick up our expert's report when we presented at mediation we had spent quite a lot of money on that report and asked them to please review the minimal effects and they refused even to consider on my time is going by quickly here so i just wanted to make sure that i touched on also the the issue of whether or not the law section thirty eight twenty two grandfathers in land that was earlier prior converted this is an important issue the the the question is whether or not this court in cages in a chevron analysis and whether or not the agency the agency's interpretation of the statute is entitled to deference you're you agree chevron different reasons there is no ambiguity just give me one good the plane reading of the statute or the plane reading of the statute has a date and parent that equals the supreme court has instructed a parent that a girl is just a parent that it will what's in the parent that acquittal does not alter the meaning of the statue the first antecedent date outside the parent that at home is the date that the property was previously identified as a wetland we maintain that happened in one thousand nine hundred sixty four the eighth circuit your sister circuit has construed at the way i'm proposing when you say the date outside it we're talking the phrase a weapon previously identified as a converted wetland yes or there's no date in that and that is not talking about a date it's talking about a condition well previously as a chronological term ok i know it but you're but you're trying to take the supreme court statement to mean that the parent that a cold has no meaning and no effect i mean why did they put that date in there if the original conversion was commenced before december that sounds like you know a normal condition precedent that you write in a sentence or a statute and you think about was the original conversion commenced before that day and you're just saying it has no meaning when when the court looks at the very next provision section eeg which i did not reprint in the brief but section easy specifically talks about the date of the determination being very important the next section hinges on section eighty and depending on your appetite for legislative history both in one thousand nine hundred five and in one thousand nine hundred the legislative history says that congress want in the taxed wealth there's an ambiguity in the taxed that's not very helpful to trying to win a step one chevron argument you only want the website history if there's ambiguity in the text i submit that under a strict construction of the chevron analysis one need not look at legislative history but it's not entirely prohibited in order to inform the court of what congress intended so with one eye we're looking at let's say of history in the other i were ignoring the fact that if it's ambiguous we get we defer to the agency while you're on it  seems cross eyed i have answered as best i could limit let me let me ask you the can see if i've got the dates right because i've had some of these same questions but this language was edited in one thousand nine hundred ninety six is that and you say they wanted to grandfather clearly wanted to grandfather something but under your interpretation if you went out the week before they were congress and acted the statute in ninety six and destroyed the wetland you would still be grandfathered and then what is there that says they intended to grandfather that rather than grandfather in the people before one thousand nine hundred eighty five now why they picked bed i don't know if you have a if that's in the legislative history i'd be interested you know i'm i confess i lost track of your question ok as i understand the fuss here the statue was an act in  before december twenty three of eighty five for some reason i think it was nine hundred ninety ok but in any event at some date significantly after that is a period of time between the one thousand nine hundred five date and the  are we agreed there yes or ok your interpretation is it's grandfathered even if you converted the wetland the week before congress passes the law in which which which term the first time or the second for the apple e department of agriculture all due respect to the appellant and the opponent's counsel this is a family thing and he has lived through it and with it there is a deck there's a five decade history attached to this case beginning with the one nine hundred sixty one saw and water conservation plan i will never have his perspective i do know however that this is not a case of the agency on a vendetta or hiding the ball from the of helen it's the appellate that set the case in motion when he filed the form eighty ten twenty six certification indicating that he intended to either create a new drainage system or conduct land leveling filling dredging or stump removal in two thousand and eight or two thousand and nine this is on that two point two four acre wetland and that wasn't that happened in two thousand and eight so any file the certification really was he farming it at that point was he farming this parcel or was it he was getting ready to die getting ready i as i understand your honor the december twenty third one thousand nine hundred five date in the statute and whether it was prior converted  and i suppose when that certification was made pellant having a long history of being conservation counts conscious for decades i believe he presumed that he was going to have a prior converted wetland the exemption an exemption from in eligibility under sixteen u s c section thirty eight twenty one the swan busts want us to provisions but that legislation was intended to protect wetlands as they existed on december twenty third one nine hundred eighty five which is the enactment date of the statute and penalize with drawls without attempting to think i think that the analysis that the agency has been maintaining and that that was held by by horn farms in the seventh circuit in the southern district of indiana in two thousand and thirteen is that if the wetland was converted to a crop land before december twenty third one thousand nine hundred five and it had been abandoned as a crop land and reverted to wetland status before that date that date being december twenty third one thousand nine hundred five and maintained its wetland characteristics on that date the land could not be certified as prior converted cropland but instead would always be treated as a wetland and that was a situation to advance its goal of slowing the comp the conversion of critical wetlands to agricultural lands while allowing individuals who were farming converted wetlands in one thousand nine hundred five to continue to farm those lands without that part of the case i say point it seems pretty innocent and you know the agency what's it called the farm service agencies explanation for not giving any reduction in the penalty references one doesn't reference all the factors doesn't discuss the other factors why is that i mean i realize you are trying to preach this is a pretty favorable standard for you but when you talk about just one of the factors  and the other seems like they're kind of compelling here that seems a little bothersome yana i think that the agency did did more than just narrow it the case has been boiled down to the point where it is in front of of this panel at this point but there are thousands of pages hundreds even thousands of pages of reports and submissions by the opponent that would seem to make it very easy to have an explanation for no penalty reduction just reference all the things reference all the factors and it's probably not going to be arbitrary capricious but that's not what she did i mean and what pages there are the longer it is the more bizarre it is that  there other lots of other factors yes there are a lot of other factors but i think by that point in the case the fact that the the pellet would not come to the table colored colored the reaction of the of the agency will be just because the colors your reaction doesn't mean you're entitled to ignore the law and colored reactions are often prejudiced reactions i mean what if what does that mean you are fed up with comprised of federal functionaries are these like friends and neighbors and competitors how is that structured i think your honor that is structured with with state actual county individuals i don't think it's a it's a federal entity how do you individuals meaning county employee use or volunteers would you know how does that work i don't know i do not know for sure your honor but i think of the county committee made up of county residents i don't know that they have they have titles beyond it's kind of like adreno a draft board that is they have some status but they're from local people that are chosen some way i think that is correct  t the having having gone through the convey that the conversion fight and that it that it was not entitled to a prior converted exemption we move into the minimal effects and and and and penalty reduction and penalty reduction is is is the final version where by one point when the appellant couldn't couldn't change course on the conversion the prior converted exemption moved into the minimal effect and all that all these levels it wasn't a a a cursory look that's that's it because plaintiff's continued to ask for reconsideration director review and appeal and he was  all of those was yes he was your honor and i'm my argument is that that there's a there's a lot more that went on behind the scenes than actually dribbled out into into reports and final decisions in and boiled down before this court so this is an affable phrase you know it's just that a geisha just mentioning one factor we should just say well because there's lots of stuff behind the scenes going on we should assume they got it right because of all the stuff going on behind the scenes to trouble with with that that conclusion or that summary analysis but but we're talking we're talking about a lot of back and forth between between the appellant and county boards and the farm service agency and the n r c yes and there was a lot of back and forth and i think everything was fairly aired and of the part of the case that i can understand from your perspective is why won't you just help us out here how difficult is this it's not going to cost you that much to try to recover some of this west land or let's have a compromise you'll do in a course like i get that you get your side of it but his side of it this is not a huge fanis is not a couple thousand acre farm it's a fifty acre farm that makes this two point five acres pretty material part of the farm so it's has serious economic consequences whether he gets to farm it or not so i don't all i see is the agency only thinking about your side of it not paying attention a fact this is a small farm or small farm and two point five acres is a lot in that context and the farm did i think that the problem for the agency here is by proving that it mattered the problem for the agents yes your honor it did matter in any continued to farm it but he transformed converted it manipulated the land until he could fire on it again and that's the problem i think the agency was having at both levels the n r c yes and the farm service agency with respect to that the game kept changing because because the power but continued on farming the land we you know he didn't stop and say wait a minute let's let's sit down let's get this right he he moved on he got into it a mediation agreement which allowed him to manipulate the land i mean there is the statutory interpretation question that's the threshold here for us that would have a lot of if you were right about this  everything he did would have been permissible right i mean the sixth circuit hasn't weighed in on it the seventh circuit has a great opinion for you guys and i know you're trying to get us to the same thing here maybe we will but until bats done he have the right to do all that stuff it's just seems really funny to ordinary in the west hold that against him and tell of the sixth circuit ruled on i don't think they held it against him they were cooperating with him allowing him to move forward but saying now that you've moved forward and you've converted land and you have it and it's not a minimal effect because because you've changed everything you've turned it into farmland and you you grown crops on it so now we now sum up to some of the fact the way that they were were viewing their statutes and and regulations it tied their hands to say look at you have to do you have to go through this jump through this hoop next or or at least we sit down and i think i think the district court got it right i don't think the district court in this case was was imposing mitigat on the a pallant it was merely merely taking a step back and looking and what is the key to this thing in a guy case where mediation could help i think well there was  that might be useful sometimes when we have an argument like this we say well we'll hope withhold a decision for sixty days or whatever and see if our mediators office working with the parties can come to an agreement with that only productive that i'm not sure how productive because we're when that was discussed or i think when there was was some amount of reaching out to the appellant at the agency level part of the problem with mediating it or or coming to some compromise was the way the agency views its statutes and regulations is there has to be there has to be some kind of component to this to to to come to some to come to some compromise and an appellate sometimes oh i commence at the six circuit have a way of sharpening the focus of the parties about what's reasonable i understand your honor but but in my view candidly i think i think to sit down in and have a mediation of this case it would have to have that mitigation component to it and appellate when you say that you mean the claimant would have to be willing to do some education yes you're on in your view up to now they've shown zero interest to do anything right correct your honor well but if they they were to change their view on on from my from my perspective which is a few steps back from from what the agency did i i i think so from way the way i bowed down the cases if if the  have come to the rest to the mitigation table something better might have happened in it that i know those appellant's brief talks about you know double the amount of land i don't know that that's true because it never happened because a couple of points the case that brother council cited talked about a southern indiana case and he mentioned in that case that the farmer had abandoned the wetland just wanted to point out that in this case there were expressed findings on the record that mr smith had not abandoned the harder you friend of the horn farms case it was a follow on case in the southern district of indiana secondly i wanted to correct something that judge sutton mentioned is that mr smith owns more land than this then just this one fifty acre field that's the size of this field but he also owns other acreage i didn't want you to be into that misimpression how much other acreage well it's in the process of he's he's sold quite a bit of it but at this point i think he owns probably at least five hundred acres  the agency has not being flexible whatsoever with the mitigation requirement so it's a litigator position has been perfectly consistent with that and so but with that that's with regard to the point up to now that the question and just an honest procedural question happens occasionally is when you've all been briefed and you've heard our comments and so on people say now we might be interested in mediating this we have a pretty good mediators office you're not bound to anything and sometimes we'll say you know see what you can do and let us know if you've made any progress and if not we'll give you a law and in effect what i'm hearing is and there's nothing wrong with that that previously you haven't been willing to put any mitigation on the table they haven't been willing to give any ground they seem to say maybe if you'll put some mitigation on the table maybe they would thirty the the thing that hasn't been discussed enough at this oral argument is the minimal effects analysis that is an issue that's very important regardless of how you rule on the other two issues farmers across michigan which tends to have lots and lots of what spots would like the agency to follow the law just follow the law and analyze minimal effects there's no finding you will search in vain throughout this record for any consideration of minimal effects they keep saying they seriously considered it yet they don't point to a scrap of evidence to back that up it's just argument of counsel so farmers across this district across the circuit rather would appreciate guidance thank you