Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_05-cv-01608/USCOURTS-caed-2_05-cv-01608-6/pdf.json

Nature of Suit Code: 893
Nature of Suit: Environmental Matters
Cause of Action: 42:4321 Review of Agency Action-Environment

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1

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

EARTH ISLAND INSTITUTE, No. 2:05-cv-1608-MCE-GGH

a California non-profit;

and CENTER FOR BIOLOGICAL

DIVERSITY, a non-profit

corporation,

Plaintiffs,

v. ORDER

UNITED STATES FOREST SERVICE; 

DALE BOSWORTH, in his official

capacity as Chief of the U.S.

Forest service; and JOHN BERRY,

in his capacity as Forest

Supervisory for the Eldorado

National Forest, 

Defendants.

SIERRA PACIFIC INDUSTRIES,

Defendant-Intervenor,

and

TUOLUMNE COUNTY ALLIANCE FOR

RESOURCES AND ENVIRONMENT;

SIERRA RESOURCE MANAGEMENT, INC.;

TUOLUMNE COUNTY CHAMBER OF COMMERCE;

and CALIFORNIA FOREST COUNTIES

SCHOOLS COALITION,

Defendant-Intervenors.

Case 2:05-cv-01608-MCE-GGH Document 103 Filed 11/20/06 Page 1 of 9
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All further references to “Rule” or “Rules” are to the 1

Federal Rules of Civil Procedure unless otherwise noted.

2

By Order dated September 8, 2006, this Court allowed

Tuolumne County Alliance for Resources and Environment

(“TuCARE”), Sierra Resource Management, Inc., the Tuolumne County

Chamber of Commerce, and the California Forest Counties Schools

Coalition to intervene in this matter on a permissive basis under

Federal Rule of Civil Procedure 24(b) for the limited purpose of 1

whether a more substantial surety bond should be required as a

prerequisite for continued maintenance of the preliminary

injunction entered on August 31, 2006. Briefing in that regard

was submitted by the TuCARE Intervenors as enumerated above on

September 11, 2006. In addition, on September 13, 2006, the

remaining Intervenor Defendant, Sierra Pacific Industries, filed

its own brief requesting that bond in this matter, currently set

at $1,000.00, be increased to $200,000.00. The Court now

considers those requests.

Rule 65(c) provides that issuance of preliminary injunctive

relief should be conditioned upon posting of security by the

applicant, stating in pertinent part as follows:

(c) Security. No restraining order or preliminary

injunction shall issue except upon the giving of security by

the applicant, in such sum as the court deems proper, for

the payment of such costs and damages as may be incurred or

suffered by any party who is found to have been wrongfully

enjoined or restrained.

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Case 2:05-cv-01608-MCE-GGH Document 103 Filed 11/20/06 Page 2 of 9
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3

Although the language employed by Rule 65(c) is mandatory in

nature, it has long been the rule that plaintiffs who seek

preliminary injunctive relief in actions to enforce the National

Environmental Policy Act (“NEPA”) are excused from the general

rigor of the Rule’s security requirement. In Friends of the

Earth, Inc. v. Brinegar, 518 F.2d 322, 323 (9th Cir. 1975), the

Ninth Circuit reasoned that because NEPA plaintiffs are often

public interest groups possessing few resources, requiring

substantial bonds from such litigants could “preclude[] effective

and meaningful appellate review.” Id. Similarly, in another

case involving public interest litigants, Cal. ex rel. Van De

Kamp v. Tahoe Reg’l Planning Agency, 766 F.2d 1319, 1325-26 (9th

Cir. 1985), the Ninth Circuit reiterated that a nominal bond is

appropriate where a party cannot afford to post a substantial

bond and if imposition of a bond requirement would serve to

prevent judicial review. Plaintiffs herein therefore have the

burden of demonstrating that posting such a bond would cause

undue hardship.

In the present case, Plaintiffs seek to enforce both NEPA

and the National Forest Management Act (“NFMA”) under the

auspices of the Administrative Procedures Act (“APA”). In

enacting NEPA, Congress indicated that private environmental 

organizations should assist in its enforcement. See 42 U.S.C. §

4331(a); Natural Res. Def. Council, Inc. v. Morton, 367 F. Supp.

167, 168 (D.D.C. 1971). Consequently, in analyzing the propriety

of security in this case, the Court should first look at whether

requiring a substantial bond in this case would stifle such

enforcement.

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4

In arguing for additional security, Intervenor Defendants

point primarily to the fact that Plaintiffs’ 2004 published tax

returns show total year-end assets of $5.99 million for Earth

Island Institute and $2.35 million for the Center for Biological

Diversity. Based on those numbers, Intervenors argue that

Plaintiffs “should be able to afford a sizeable bond” without

potentially thwarting the viability of environmental citizen

actions. (See TuCARE Opp’n, 12:14-16).

As its primary authority for contending that bond in this

matter be increased, Intervenors cite the Ninth Circuit’s recent

decision in Save Our Sonoran, Inc. v. Flowers, 408 F.3d 1113 (9th

Cir. 2005). Save Our Sonoran, like the present case, involved an

environmental challenge under NEPA. While the Ninth Circuit did

affirm a $50,000.00 bond, it nonetheless recognized the wellestablished authority enumerated above which militates against

requiring substantial security where doing so would impair access

to judicial review. Id. at 1126, citing Van De Camp, 766 F.2d at

1325. Instead, the court’s decision makes it clear that the

environmental group in Save Our Sonoran simply failed to

establish at the hearing on the bond issue that imposition of a

substantial bond would be detrimental. As the Ninth Circuit

states:

“Here, the district court conducted a hearing. SOS [Save

Our Sonoran] had the opportunity to show that the imposition

of anything other than a nominal bond would constitute an

undue hardship; however, SOS did not tender such evidence at

the hearing.”

Id. 

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5

In the present case, on the other hand, Plaintiffs have

proffered evidence that an increased bond would severely impact

their ability to pursue environmental litigation through this

case and others. The Declaration of Chad Hanson in Opposition to

Increase in Surety Bond indicates that the funding responsibility

for pursuing the instant lawsuit rests entirely with the John

Muir Project (“JMP”), a discrete project within the

organizational umbrella of the Earth Island Institute. As Mr.

Hanson explains, while the Earth Island Institute acts as a

fiscal sponsor and provides administrative support, all

fundraising for projects embarked on by the JMP is done

exclusively by the JMP. (Hanson Decl., ¶¶ 2-3). Similarly, as

Mr. Hanson also attests, while the Center for Biological

Diversity (“CBD”) provides certain staff assistance for

development of factual issues arising in JMP cases, the JMP

itself indemnifies CBD against any fees, costs or bonds for JMP

projects. Id. at ¶ 3.

Significantly, with respect to JMP’s budget, Mr. Hanson, as

the Project’s Executive Director, states that only $56,000 has

been earmarked for forest litigation activities during 2006. 

Hanson goes on to state that every dollar of that budget for the

remaining fiscal year is needed to sustain payroll and expenses

related to JMP’s current cases. He opines that any unexpected

contingency, like imposition of a substantial bond in this case,

would be devastating to JMP’s ability to effectively maintain its

current cases, let along challenge any additional logging

projects it feels run afoul of environmental laws. Id. at ¶¶

5,8).

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6

It should also be noted that declarations submitted by

administrative personnel for both the Earth Island Institute and

the CBD further attest to the fact that the stated assets of both

organizations, as reflected on their tax returns, are not

indicative of discretionary funds available to pay the

dramatically increased bond amount advocated by Intervenors. 

With respect to Earth Island, Director of Administration Yvette

Hash explains that her organization acts as a fiscal sponsor for

about forty different projects, each responsible for its own

staffing, fundraising, and program work. (Hash Decl., ¶ 3). 

According to Ms. Hash, Earth Island consequently cannot divert

funds given for one program or Project under the Earth Island

umbrella to another program or Project, because doing so would

violate donor intent, expose Earth Island to potentially costly

legal liability, and put the entire organization at risk. Id. at

¶ 5. As an example, while Earth Island’s total year-end assets

for 2004 were reported on its tax returns as nearly $6 million

dollars, almost $3.7 million of that total constitutes the corpus

of a Wetlands Restoration Trust Fund established by a Stipulation

and Consent Decree of the Southern District of California. That

restricted fund can only be used for wetland restoration

projects. Earth Island’s remaining assets consist primarily

either of other funds earmarked for other specific projects or

receivables that denote pledges made, with the corresponding

funds not yet received. Id. at ¶ 6. 

Similarly, with respect to the CBD, the bulk of its assets

also constitute grants dedicated towards specific funding

objectives. 

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 Importantly, Plaintiffs also assert that they are the only 2

organizations which consistently challenge Sierra Nevada salvage

timber sales of the type at issue herein. Hence, if Plaintiffs

are thwarted in their ability to challenge such projects by

imposition of substantial bond requirements, there would appear

to be a real possibility that the projects would evade judicial

review altogether.

7

According to Executive Director Michael Finkelstein, funds

remaining for general operating expenses in 2006 have already

been allocated. Financing a significant bond out of general

operating expenses at this juncture could require elimination of

administrative staff positions at the Center. (Finkelstein Decl,

¶¶ 4-5).

 Unlike Save Our Sonoran, Plaintiffs here have shown,

through the evidence enumerated above, that imposition of a

substantial bond would pose a considerable, if nor

unsurmountable, financial hardship affecting their ability to

mount challenges like the present case to environmental actions

allegedly running afoul of the law. That showing not only 2

distinguishes the present case but also compels a finding that no

additional bond should be required. As Plaintiffs point out, the

overwhelming majority of district courts in this Circuit have

issued injunctions on cases involving logging on public lands

with, at most, only a nominal bond. (See Pls.’ Reply, p. 5, and

cases cited therein). Indeed, with the exception of the Save Our

Sonoran case distinguished above, the parties have cited to no

decision within the Ninth Circuit requiring public interest

plaintiffs like Earth Island and the CBD to post a substantial

bond, pursuant to Rule 65(c), as advocated by Intervenors.

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8

Additionally, in determining the propriety of a surety bond

in any case, the Court must consider the likelihood that

Plaintiffs will ultimately prevail on the merits, since the very

purpose of such security, pursuant to Rule 65(c), is to mitigate

damages suffered by a party ultimately found to be “wrongfully

enjoined or restrained.” As recognized by the Ninth Circuit in

its Van De Kamp decision, Plaintiff’s likelihood of success on

the merits “tips in favor of a minimal bond or no bond at all.” 

Van De Kamp, 766 F.2d at 1326. Here, the Ninth Circuit has

already found, upon review of this Court’s prior denial of

Plaintiffs’ request for preliminary injunction, that Plaintiffs

have shown a “strong likelihood of success on the merits” as to

both its NEPA and NFMA challenges to the logging projects at

issue. Earth Island Institute v. U.S. Forest Serv., 442 F.3d

1147, 1159, 1176-77 (9th Cir. 2006). Hence, even if Plaintiffs

had not been successful in showing that imposition of a bond

would pose a hardship chilling their ability to mount

environmental challenges akin to the present case (which

Plaintiffs have in fact been able to do in this instance), the

fundamental premise on which a security requirement is based

appears absent given the likelihood that Plaintiffs will prevail

and Intervenors will consequently not have been wrongfully

enjoined.

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9

For all the above reasons, the Court rejects Intervenors’

request for a more substantial bond in this matter. Bond will

stand at $1,000.00 as originally ordered by the Court. 

IT IS SO ORDERED.

DATED: November 20, 2006

_____________________________

MORRISON C. ENGLAND, JR

UNITED STATES DISTRICT JUDGE

Case 2:05-cv-01608-MCE-GGH Document 103 Filed 11/20/06 Page 9 of 9