UNITED STATES DEPARTMENT OF JUSTICE

ENVIRONMENT AND NATURAL RESOURCES DIVISION

SUMMARY OF LITIGATION ACCOMPLISHMENTS

FISCAL YEAR 2007
CONTENTS

FOREWORD i

PROTECTING OUR NATION’S AIR, LAND AND WATER 1

ENSURING CLEANUP OF OIL AND HAZARDOUS WASTE 6

PROMOTING RESPONSIBLE STEWARDSHIP OF

AMERICA’S NATURAL RESOURCES AND WILDLIFE 8

CRIMINAL ENFORCEMENT OF OUR NATION’S 

POLLUTION AND WILDLIFE LAWS 13

DEFENDING VITAL FEDERAL 

PROGRAMS AND INTERESTS 17

PROMOTING NATIONAL SECURITY

AND MILITARY PREPAREDNESS 26

PROTECTING INDIAN RESOURCES

AND RESOLVING INDIAN ISSUES 27

SUPPORTING THE DIVISION’S LITIGATORS 28
FOREWORD

I am honored to present this summary of the Environment and Natural Resources

Division’s litigation accomplishments for Fiscal Year 2007. This has been an extraordinary

year. The Division both brings affirmative civil and criminal enforcement actions and defends

federal agencies when their actions or decisions are challenged on the basis of our environmental

or public lands and resources laws. As in past years, the Division achieved significant victories

for the American people in each of the many areas for which it has responsibility. These

responsibilities include protecting the Nation’s air, water, land, wildlife and natural resources,

upholding our trust responsibilities to American Indians, acquiring needed lands for federal

agencies, and otherwise defending important federal programs.

The Division’s vigorous enforcement of our environmental laws again resulted in

recordbreaking achievements in both the civil and criminal arenas. Enforcement is a critical

component of environmental protection and helps ensure that our citizens breathe clean air, drink

clean water, and will be able to enjoy the country’s public lands, wildlife and other natural

resources for generations to come.

In civil enforcement, the Division obtained nearly $6.7 billion in injunctive relief,

through contested judgments or judicially approved consent decrees – the second largest single

year amount ever. The injunctive measures secured will ensure that harmful sediments are

removed from rivers, state of the art pollution control devices are added to factories to provide

cleaner air, sewage discharges are eliminated, and damaged land and water aquifers are restored. 

This record result does not include one of the largest enforcement cases of all time, the massive

case against American Electric Power for alleged Clean Air Act violations, which was resolved

by consent decree lodged on October 9, 2007. Working jointly with eight states and thirteen

environmental groups, the Division led the effort to bring the company into compliance with the

law and obtain extraordinary pollution reduction. The settlement will require American Electric

Power to undertake remedial actions to reduce its emissions of pollutants at an estimated cost of

$4.6 billion, the highest value of injunctive relief ever obtained in an environmental case. The

environmental impact is enormous. When fully implemented, the settlement will secure more

than 800,000 tons per year of air pollution reductions. The foundation for this result was laid by

the Supreme Court’s recent – and unanimous – decision in which the Division vindicated the

Environmental Protection Agency’s position on a key liability issue related to power plant

emissions.

The Division also secured a record penalty in a settlement with the East Kentucky Power

Cooperative that included the highest fine ever imposed under the Clean Air Act’s acid rain

program. And in a wide range of other cases, the Division continued to protect the nation’s air

quality by successfully pursuing Clean Air Act claims against oil refineries, automobile

manufacturers, and diverse industrial facilities.

The Division also worked successfully to ensure the integrity of municipal wastewater

treatment systems. Each year, hundreds of billions of gallons of untreated sewage are discharged

i
into the nation’s waters from municipal wastewater treatment systems that are overwhelmed by

weather conditions that they are not adequate to handle. This year, the Division reached

settlements with several cities – including two of the largest sewer treatment settlements ever,

encompassing Indianapolis and the Pittsburgh region – that will collectively provide for more

than $4 billion in expenditures to bring these systems into compliance with the Clean Water Act. 

These settlements will ultimately reduce the volume of untreated sewage discharged into our

streams and rivers by tens of billions of gallons. The Division also protected the nation’s waters

and wetlands from illegal fill through Clean Water Act enforcement actions.

The Division this year also successfully concluded the first court action ever brought

under the Pipeline Safety Act. The settlement of this case – which arose out of a tragic

explosion of an El Paso Natural Gas Company pipeline which killed twelve people – will require

the defendant to pay a $15.5 million civil penalty and to spend at least $86 million on

comprehensive upgrades of its pipeline system. 

The Division’s critical enforcement successes in the civil arena were paralleled in the

criminal arena. As part of the Division’s ongoing initiative to prosecute those who dump waste

oil and other chemicals from ships into the oceans and coastal waterways and who keep false

records to hide those activities, the Overseas Shipholding Group was sentenced to pay $37

million in penalties – the largest ever penalty for concealing vessel pollution. The Division also

obtained plea agreements, convictions, substantial terms of imprisonment, and criminal fines

against violators who intentionally violated the Clean Air Act, Clean Water Act, laws

safeguarding the public from exposure to hazardous waste, and laws protecting wildlife. For

example, the Division recently reached plea agreements with two British Petroleum subsidiaries

for environmental crimes relating to a fatal explosion at a Texas refinery and to leaks of crude oil

from pipelines. In agreements announced in October 2007, British Petroleum agreed to pay $50

million in criminal fines for Clean Air Act violations relating to a catastrophic explosion that

killed 15 employees and injured at least 170 others, and, in a second case, agreed to $12 million

in criminal fines, $4 million in community service payments, and $4 million in restitution to the

state for Clean Water Act violations relating to pipeline leaks onto the tundra and into a frozen

lake in Alaska. In another case, the Division secured convictions against Citgo Refining and

Chemical Company for having operated open oil tanks that lacked proper emission controls and

in which birds protected by the Migratory Bird Treaty Act were trapped and killed, due to the

company’s failure to install inexpensive protective equipment.

Record-breaking sentences and enforcement cases are impressive but they are only a part

of the Division’s work. An equally important aspect of the Division’s work is its defense of vital

federal programs, including military and national security programs. For example, the Division

successfully defended the Army against challenges to its chemical weapons demilitarization

program. We assisted the military in its training, preparations and deployment in the war on

terrorism with a court victory that allowed the Army to resume activities critical to converting

the 2nd Brigade, 25th Infantry Division into a Stryker Brigade as part of the Army’s

modernization plan. The Division also acquired property essential to military and homeland

security needs.

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The Division promotes responsible stewardship of our natural resources by defending

federal agencies charged with such tasks as determining whether a species should be listed as

endangered or threatened, managing fishery resources in a way that balances various interests,

overseeing water conservation projects, managing activities on federal lands that range from

grazing to oil and gas leasing, and protecting the nation’s forests from the risks of wildfire. This

year, the Division had important successes in facilitating the work agencies do in all these areas. 

The Division’s work also secures critical water rights for the United States. This year,

the Division reached important settlements and secured favorable judgments ensuring access to

the water necessary to maintain the vitality of natural resources and uses of the public lands,

national forests, national parks, wildlife refuges, wild and scenic rivers, military bases, and

federal reclamation projects throughout the West. Another primary responsibility of the

Division is the implementation of the United States’ trust responsibility to Indian tribes and the

resolution of the issues pertaining to American Indians. We work to protect tribal fishing and

water rights, this year, for example, reaching a comprehensive settlement that resolves litigation

ongoing since the 1970s and vindicating the hunting and fishing rights of five tribes under the

1836 Treaty of Washington.

The Division currently has a docket of over 6,800 active cases and matters. The cases the

Division handles arise under more than 150 different statutes, including the Clean Water Act, the

Clean Air Act, the Safe Drinking Water Act, the Comprehensive Environmental Response,

Compensation and Liability Act, the National Forest Management Act, the Federal Land Policy

and Management Act, the National Environmental Policy Act, and the Endangered Species Act. 

The Division litigates in every judicial district in the Nation. 

As someone who has served more than a decade in the Department of Justice but is

relatively new to the Division, I have been impressed with, but unsurprised by, the dedication

and hard work of the Division’s attorneys and support staff. The service and commitment of our

people is in perfect keeping with the Department’s highest traditions. The Division’s exemplary

record in protecting the environment, American Indian rights, and the Nation’s natural resources,

wildlife, and public lands is due to the hard work of these people, as well as our client agencies,

the United States Attorney’s Offices, and state and local officials around the country. The

Division’s work is a powerful demonstration that our national government can – and does –

make a positive difference in the lives of Americans.

Ronald J. Tenpas

Assistant Attorney General

Environment and Natural Resources Division

March 2008

iii
PROTECTING OUR NATION’S AIR,

LAND AND WATER

Reducing Air Pollution from Power

Plants. During the past year, the Division

continued to successfully litigate Clean Air

Act (CAA) claims against operators of coalfired electric power generating plants. The

violations arose from companies engaging in

major life extension projects on aging

facilities without installing required state of

the art pollution controls, resulting in tens of

millions of tons of excess air pollution that

has degraded forests, damaged waterways,

contaminated reservoirs, and adversely

affected the health of the elderly, the young,

and asthma sufferers. 

This year, the Division achieved a

notable Supreme Court victory upholding

the Environmental Protection Agency (EPA)

interpretation of the CAA that underlies

many of these enforcement efforts. In

Environmental Defense v. Duke Energy

Corp., the Supreme Court, in a 9-0 decision,

agreed with the United States that the lower

courts had impermissibly reviewed the

validity of EPA’s Prevention of Significant

Deterioration (PSD) regulations, which they

lacked authority to do under the CAA. The

Supreme Court also reasoned that EPA was

not required to give the same meaning in its

regulations to different statutory uses of the

term “modification” and that, for the

program at issue, it was reasonable for EPA

to measure emission increases based on

hourly rates even though another program

measured emission rates on an annual basis. 

The two programs had distinctly different

purposes, and EPA was free to choose

different ways to measure pollution outputs.

In United States v. East Kentucky

Power Cooperative, the Division obtained a

consent decree that resolved claims under

the CAA’s New Source Review

(NSR)/PSD provisions, under which EKPC

agreed to system-wide tonnage limits on its

emissions of sulfur dioxide (SO2) and

nitrogen oxide (NOx), reducing annual

emissions by approximately 50,000 tons

per year. The reductions will be achieved

by the installation of controls estimated to

cost $650 million. The decree also requires

EKPC to pay a civil penalty of $750,000,

and to conduct an environmental mitigation

project at a cost of at least $5 million. In a

separate landmark settlement, EKPC also

agreed to settle claims under the CAA’s

acid rain program and pay the largest civil

penalty to date under that program – $11.4

million – as well as take steps to reduce

approximately 400 tons of harmful

emissions annually and offset another

approximately 20,000 tons of emissions

released from its facility located in Clark

County, Ky. 

In United States v. Wisconsin

Electric Power Company, the district court

entered an amended consent decree, nearly

four years after its lodging. This

system-wide power plants settlement

requires WEPCO to install pollution

control equipment at an estimated cost of

$620 million and pay a $3.1 million civil

penalty.

The Division also obtained the first

consent decree with an electric utility,

Nevada Power Co., for violations at a gasfired plant. Pursuant to the consent decree,

Nevada Power will install approximately

$60 million in pollution controls to secure

significant reductions of NOx from four of

its operating units.

1
In addition, the Division secured an

amendment of a 2002 consent decree

stemming from the failures of certain

coal-fired power plants owned by Public

Service Electric Gas in New Jersey to meet

emissions reduction requirements in the

2002 consent decree. The newly achieved

air pollution reductions are equal or in

certain respects superior to those that would

have been achieved under the 2002 consent

decree. PSEG will also pay a civil penalty

of $6 million and perform environmental

mitigation measures valued at $3.25 million

to reduce particulate matter from diesel

engines in New Jersey. 

The settlements achieved thus far

will, when fully implemented, remove

almost two million tons of pollutants from

the air each year.

Addressing Air Pollution from Oil

Refineries. The Division also made

progress in its national initiative to combat 

CAA violations within the petroleum

refining industry by obtaining consent

decrees with three more refiners, Total

Petrochemical USA Inc., Valero Energy

Corporation, and Hunt Refining Co.

Total agreed to pay a $2.9 million

penalty and upgrade pollution controls to

resolve claims under the CAA. The changes

to its facility, estimated to cost $37 million,

will significantly reduce the facility’s

emissions of air pollutants, ultimately

reducing annual emissions of NOx, SO2, and

carbon monoxide by more than 180, 800,

and 120 tons, respectively. 

Valero agreed to pay a $4.25 million

penalty and install $232 million worth of

new and upgraded pollution controls at

refineries in three states. The controls will

eventually reduce annual emissions of NOx

and SO2 by more than 1,870 and 1,810 tons

per year, respectively, and will result in

additional reductions of carbon monoxide,

volatile organic compounds, and particulate

matter from each of the refineries. Valero

will also spend $1.6 million on mitigation

projects.

Hunt agreed to pay a $400,000 civil

penalty and spend more than $48.5 million

for new and upgraded pollution controls at

three refineries to resolve claims under the

CAA. The work is expected to reduce

more than 1,250 tons of harmful emissions

annually from the company’s refineries.

The States of Alabama and Mississippi

joined in the settlements. 

With these settlements, the

Division’s petroleum refinery enforcement

initiative will have addressed more than 92

individual refineries – comprising

approximately 85% of the Nation’s refining

capacity – and will reduce air pollutants by

more than 325,000 tons a year. 

Reducing Air Pollution from Mobile

Sources. The Division obtained a consent

decree in United States v. Mercedes-Benz

USA and DaimlerChrysler, AG, resolving

claims that the defendants failed to

promptly notify EPA of eight separate

emission-related defects in a number of

different Mercedes vehicles. The CAA

requires such prompt notification by auto

manufacturers so that the government can

consider whether a recall is necessary. In

response to the investigation, Mercedes

began voluntary recalls for two of the

defects at issue and notified owners that it

would extend the warranty coverage to

address a third defect, at an estimated cost

of about $59 million. Under the consent

2
decree, Mercedes agreed to pay a penalty of

$1.2 million and to improve its investigation

and reporting system to ensure future

compliance, at an estimated cost of about

$5.4 million. 

Reducing Air Pollution at Other Diverse

Industrial Facilities. The Division

improved the Nation’s air quality by

concluding enforcement actions against a

variety of other facilities in diverse

industries including secondary aluminum

production, sulfuric acid manufacturing,

natural gas production, metal forming, and

oil seed processing.

Those efforts, addressing similarly

diverse CAA violations, secured

commitments by defendants to perform

more than $236 million in facility

improvements, to undertake supplemental

environmental projects valued at $1.375

million to provide local environmental

improvements, and to pay more than $10.1

million in civil penalties. The states of

Alabama, California, Colorado, Illinois,

Indiana, Iowa, Kansas, Louisiana,

Mississippi and Virginia intervened as

plaintiffs and signed many of these consent

decrees.

Controlling Contaminated Storm Water

Run-off. The Division also fought for

cleaner water by enforcing Clean Water Act

(CWA) provisions governing discharge of

storm water. Storm water can harm the

environment because it contains pollutants

such as suspended solids, lead, and copper.

The Division achieved a settlement

with several St. Louis-area developers

responsible for polluting streams and lakes

with runoff from three construction sites in

United States v. J.H. Berra Construction Co.

The defendants have agreed to adhere to a

strict compliance program at future

construction projects, clean up past

pollution, and pay one of the largest

environmental penalties of its kind in the

state’s history, $590,000. The United

States was joined in the decree by the city

of Wildwood and the state of Missouri. 

Ensuring the Integrity of Municipal

Wastewater Treatment Systems.

Through its aggressive national

enforcement program, the Division

continued to protect the Nation’s

waterways by ensuring the integrity of

municipal wastewater treatment systems. 

The settlements the Division reached this

year will ultimately reduce the volume of

untreated sewage discharged into our

waterways by tens of billions of gallons.

The Division lodged a consent

decree with the city of Indianapolis,

resolving claims relating to discharges from

the city’s sanitary sewers and overflows

from the portions of its sewer system

where storm water and sanitary sewage are

combined (combined sewer overflows or

CSOs). The city will implement a longterm control plan at an estimated cost of

$1.86 billion, perform a pollution reduction

supplemental environmental project valued

at $2 million, and pay a civil penalty of

$1.17 million. The injunctive relief

provided under the settlement will

ultimately reduce the volume of

Indianapolis’ CSO discharges by over 90

percent, or 7.2 billion gallons per average

year out of its current average of 7.9 billion

gallons/year.

In a landmark settlement with

federal, state, and county authorities, the

defendant in United States v. Allegheny

3
County Sanitary Authority agreed to a

comprehensive plan to greatly reduce the

annual discharge of billions of gallons of

untreated sewage into local waterways. 

ALCOSAN has agreed to a multi-year

strategy to upgrade the sewage systems

serving Pittsburgh and 82 surrounding

municipalities at a cost in excess of $1

billion. The settlement also requires

ALCOSAN to pay a $1.2 million penalty for

past CWA violations, and to undertake $3

million in environmental projects. 

The Division also lodged an interim

consent decree with the City and County of

Honolulu (CCH) that will correct the most

significant problems in Honolulu’s

wastewater collection system. Because the

interim settlement addresses only the most

urgent problems in CCH’s collection

system, the United States and the State of

Hawaii are continuing to work actively with

CCH to reach a comprehensive resolution to

CCH’s remaining wastewater collection and

treatment challenges.

The Division lodged its final,

comprehensive consent decree in United

States v. City of San Diego, resolving our

CWA action against the City relating to the

unlawful discharges of sewage from the

City’s sewer system. Two previous decrees

with the City had required it to take interim

measures at an estimated cost of $274

million. The third and final consent decree

will require the city to continue to undertake

capital projects and perform operations and

maintenance through 2013, at a cost of an

additional $1 billion, to prevent future spills

of raw sewage from its system. 

Assuring Environmental Compliance in

the Petrochemical Industry. The Division

lodged a consent decree in United States v.

Equistar Chemicals LP under which the

defendant has agreed to spend more than

$125 million on pollution controls and

cleanup to address myriad air, water and

hazardous waste violations at seven

petrochemical plants in Texas, Illinois,

Iowa and Louisiana. Equistar will also pay

a civil penalty of $2.5 million (to be

divided among the United States and state

co-plaintiffs, Iowa, Illinois and Louisiana)

and spend $6.56 million on supplemental

environmental projects. Under the consent

decree, Equistar will be the first in the

petrochemical industry to adopt certain

environmental measures, many of which go

beyond what the regulations would require. 

Defending a Novel Enforcement

Approach to Address Pollution from

Factory Farms. In Association of Irritated

Residents v. EPA, the District of Columbia

Circuit rejected challenges to a series of

administrative consent agreements that

EPA entered to settle potential violations of

the CAA and the Emergency Planning and

Community Right to Know Act caused by

air emissions from large animal feeding

operations. Previously, there was no

existing methodology to reliably measure

factory farms’ air emissions, which has

hampered EPA’s ability to enforce the

CAA and other environmental statutes. 

Under the consent agreements, which are

designed to bring the facilities into

compliance with the permitting and

reporting requirements of the statutes,

participating farms will pay a penalty and

agree to cooperate in the development of

pertinent emissions data and monitoring

protocols. Those data and protocols will

then provide the basis for an emissions

estimating methodology to be used to

ensure future compliance. 

4
Ensuring the Supply of Safe Drinking

Water to Residents of Trailer Parks and

Other Multi-Unit Properties. In

Manufactured Housing Institute v. EPA, the

Fourth Circuit upheld EPA’s determination

to apply Safe Drinking Water Act

regulations to owners of multi-unit

properties other than apartment buildings

who separately meter and bill for water

delivered to their tenants. The court found

that EPA reasonably determined that the

water systems of trailer parks and similar

multi-unit properties require regulation to

ensure a safe drinking water supply.

Protecting the Nation’s Waters and

Wetlands. The Division obtained a number

of favorable settlements in enforcement

actions to protect the Nation’s waters and

wetlands from illegal fill.

United States v. Pala Band of

Mission Indians involved violations of the

CWA in connection with a sand and gravel

mining operation and a levee built in the bed

of the San Luis Rey River in California. 

Pursuant to a consent decree, the Pala Band

of Mission Indians will pay a $370,000 civil

penalty and fund a $545,000 mitigation

project. A separate consent decree requires

three additional defendants to pay a civil

penalty of $65,000. In United States v. Toy

Arnett, et al., the Division obtained a

consent decree settling a CWA enforcement

action concerning property in Santa Rosa

Beach, Florida. The five defendants there

were the present or former owners of two

properties, one where wetlands were

converted into pasture, and the other where

an Army Corps of Engineers permit was

violated. The defendants at the first site will

pay a civil penalty of $65,000, restore the

site, and place a conservation easement to be

held by the State of Florida over the restored

site. For the violations at the second site,

the defendants must convey title to a

nearby 20-acre mitigation parcel to an

entity designated by the United States. In

United States & State of Maryland v.

Costello, the Division obtained a consent

decree under which the defendants will

restore 8,000 square feet of the Chesapeake

Bay damaged by their construction of an

unpermitted erosion control structure. They

will also pay $20,000 in civil penalties to

the United States and $30,000 to a state

tidal wetlands fund established to pay for

state-sponsored restoration projects.

Enhancing Pipeline Safety. The Division

lodged a consent decree in United States v.

El Paso Natural Gas Co., the first court

action brought to enforce the Pipeline

Safety Act. The action resulted from a

tragic explosion of an EPNG pipeline

which killed twelve people in New Mexico

in 2000. As a result of the settlement,

EPNG will spend at least $86 million to

implement widespread and comprehensive

modifications of its 10,000-mile natural gas

pipeline system and pay a $15.5 million

civil penalty to resolve claims that it did

not adequately monitor and minimize

internal corrosion in two of its pipelines

transporting corrosive gas.

ENSURING CLEANUP OF OIL AND

HAZARDOUS WASTE

Cleaning Up Contaminated River

Systems. The Division continued its

aggressive efforts to secure cleanup of our

Nation’s most contaminated rivers under

the Comprehensive Environmental

Response, Compensation and Liability Act

(CERCLA). The Division achieved a

settlement of unprecedented size and scope

5
with the General Electric Company (GE) to

provide for cleanup of contamination from

polychlorinated biphenyls (PCBs) that two

GE plants discharged directly into the upper

Hudson River for years. The settlement was

lodged in Fiscal Year 2006 but entered in

Fiscal Year 2007 after a comment period

that drew extensive and wide-ranging public

responses. Since entry of the consent

decree, the Division has resisted various

legal challenges to the settlement.

In United States v. NCR Corp. and

Sunoco-U.S. Mills, the Division obtained a

consent decree that requires these two

defendants to perform the first phase of

remedial action for one section of the Lower

Fox River and Green Bay site in

northeastern Wisconsin. The site is

contaminated with PCBs discharged into the

Fox River from several paper manufacturing

and recycling facilities and will cost more

than $500 million to address overall. The

remedial action required by this consent

decree – which is with only two of eight

potentially responsible parties (PRPs) at the

site – is expected to cost about $30 million

and features dredging, dewatering, and

landfill disposal of PCB-contaminated

sediments from a hot-spot of contamination. 

The Division also lodged a supplement to a

consent decree in United States et al v. P.H.

Glatfelter Co. and WTM I Co. to document

the commitment of these two defendant

PRPs to provide an additional $12 million

for performance of CERCLA response

activities in another section of the site, in

addition to the approximately $60 million

provided by these parties pursuant to a 2004

consent decree addressing remedial actions

in that section of the site.

Conserving the Superfund by Securing

Cleanups and Recovering Superfund

6

Monies. The Division secured the

commitment of responsible parties to clean

up additional hazardous waste sites, at costs

estimated in excess of $270 million, and

recovered approximately $200 million for

the Superfund to help finance future

cleanups. Examples of some of the major

Superfund cases resolved by the Division

this year include: United States v.

Kennecott Utah Copper Corporation

(defendant to spend approximately $15

million to remedy groundwater

contamination caused by past mining

operations at the Bingham Canyon mine in

Utah); United States v. MidAmerican

Energy Company (defendants to pay $4.6

million in past costs and assist EPA’s

response actions at the LeMars Coal Gas

Superfund site in Iowa); United States v.

Frazer Exton Development Corp.

(defendant to perform $22 million remedial

action and pay 50% of EPA’s unreimbursed

costs at the Foote Mineral Superfund site in

Chester, PA); United States v. Exxon Mobil

Corporation (101 defendants to ensure a

site-wide $48 million cleanup of the Beede

Waste Oil site in Plaistow, NH, pay more

than $9 million for future federal and state

oversight costs, and $17 million in past

federal and state response costs); United

States v. EPEC Polymers, Inc. (defendant

to remediate two of the three remaining

known contaminated areas of the Turtle

Bayou site in Liberty County, TX, at an

estimated cost of $13.4 million; reimburse

the United States for $6.9 million of past

costs and interim costs estimated at $1

million; and pay the United States’s future

response costs, estimated at $2.1 million). 

Enforcing Cleanup Obligations In

Bankruptcy Cases. The Division’s

bankruptcy practice has continued to grow

and this year achieved notable success in
several proceedings. In the Eagle Picher

bankruptcy, the Division secured the

agreement of the debtor to deposit $13.6

million into a custodial trust to fund

environmental cleanup work at sites in

several states and obtained a judgment for

an allowed claim of over $8.7 million for a

site in New Mexico. In the Gurley

bankruptcy, the Division recovered over $20

million for two sites in Arkansas through the

avoidance of fraudulent transfers.

The Division has lodged additional

proposed settlements in various bankruptcy

courts, including in the Asarco, Fruit of the

Loom, Gulf States Steel, W.R. Grace,

Armstrong and Saltire Industrial

bankruptcies. In these proceedings, the

Division expects to receive millions of

dollars of recoveries towards past and future

cleanup costs. In one of the most

challenging proceedings, In re: Asarco LLC,

the United States asserted two kinds of

claims for over 50 Superfund sites: (1)

recovery of funds used for cleanup by other

agencies, and/or (2) natural resource

damages on behalf of federal natural

resources trustee agencies. 

Defending the Constitutionality of the

Superfund Law. In addition to its

enforcement actions to secure the cleanup of

hazardous waste sites, the Division has also

successfully defended lawsuits aimed at

interfering with cleanup actions by EPA and

other federal agencies. For example, in

United States v. Capital Tax Corp., a

Superfund cost recovery and penalty action

involving the National Lacquer and Paint

site in Chicago, the defendant brought

counterclaims alleging an EPA pattern and

practice of unconstitutional implementation

of its administrative order authority under

section 106 of CERCLA. The Division

prevailed on a motion to dismiss. The

court found that the company lacked

standing and, in the alternative, that there is

no due process violation because the

unilateral administrative order recipient

gets a pre-deprivation hearing, thus

upholding the constitutionality of key

enforcement provisions of an important

environmental statute. 

Similarly, in Raytheon Aircraft Co.

v. United States, the Division prevailed

against a claim that the administrative

enforcement provisions of section 106 of

CERCLA violate due process. The court

held that section 106 provides an adequate

opportunity for judicial review before any

deprivation of property occurs and does not

affect any protected liberty interests. The

court also rejected the argument that the

penalties authorized by section 106 are so

coercive as to deprive the administrative

order recipient of a meaningful opportunity

to challenge the order in court. 

Defending the Government’s Cleanup

Actions. In Steven Pollack v. Department

of Defense, a citizen sued the Army and

Navy, alleging they had failed to perform

certain nondiscretionary duties in

connection with the remediation of a

landfill at Fort Sheridan, Illinois. The

Division prevailed on a motion to dismiss. 

The court held that “the relief [plaintiff]

seeks in his lengthy complaint is directed at

halting the current work at the site and

changing the direction of any additional

work there. Accordingly, it is premature”

under the Superfund law. This win is

important because it allows the cleanup at

the site to go forward without being

delayed by litigation. 

7
Addressing Oil Spills. The Division lodged

a consent decree in United States v.

Meridian Resource & Exploration, LLC

resolving claims under the CWA in

connection with five unauthorized

discharges of crude oil into waters of the

United States from two pipelines and one oil

production well at Meridian’s facility during

2005-2006. Meridian will expand and

improve its pipeline monitoring, inspection,

and maintenance program and pay a

$504,000 civil penalty.

PROMOTING RESPONSIBLE

STEWARDSHIP OF AMERICA’S

NATURAL RESOURCES AND

WILDLIFE

Defending Endangered Species Act

Listings and the Critical Habitat

Program: The Endangered Species Act

(ESA) requires either the Fish and Wildlife

Service (FWS) or the National Marine

Fisheries Service (NMFS), depending on the

species, to determine whether a species

should be listed as endangered or threatened

under a set of five criteria and to designate

critical habitat for listed species. In FY 07,

we had notable success defending such

determinations.

In Alabama-Tombigbee Rivers

Coalition v. Kempthorne, the Eleventh

Circuit rejected an industry trade group’s

challenges to the FWS’s listing of the

Alabama sturgeon under the ESA as an

endangered species. The court found that

there was substantial evidence in the record

that the Alabama sturgeon was not the same

fish as the shovelnose sturgeon, a much

more plentiful species. It also held that the

Service’s failure to designate critical habitat

for the Alabama sturgeon at the same time

that it listed the fish as endangered did not

require the court to order the delisting of

the species, which was nearly extinct. The

court also rejected the argument that the

listing was unconstitutional under the

commerce clause as there was no evidence

that the Alabama sturgeon had any

interstate nexus. The court held that the

proper focus of analysis should be on the

purposes of the ESA itself, not just on the

particular species being listed, and

concluded that the ESA had a substantial

relation to commerce. 

In American Wildlands et al. v.

Norton et al., the court upheld a FWS

listing determination for the westslope

cutthroat trout on the basis that the

Service’s use of morphological data, as

well as genetic data, to identify the species

was reasonable. In National Association of

Homebuilders v. Kempthorne, the court

agreed with the Division’s argument that

the FWS’s decision not to list the pygmy

owl was reasonable, where the population

in the United States was peripheral to a

large pygmy-owl population in northern

Mexico. In Home Builders of N. Cal. v.

FWS, the court upheld FWS’s designation

of critical habitat for 15 vernal pool

species, where certain California lands had

been excluded because they already had

adequate management plans. In Alsea

Valley Alliance v. Lautenbacher, the

Division prevailed against a challenge to

the NMFS’s decision to list 16

“Evolutionarily Significant Units” of

salmon. The decision hinged on the

Service’s policy regarding consideration of

hatchery-origin fish in making listing

determinations. In Tucson Herpetological

Society v. Kempthorne, the Division

successfully defended a FWS decision to

withdraw the proposed listing rule for the

flat-tailed horned lizard, establishing the

8
legitimacy of the Service’s evaluation of lost

historical habitat in consideration of the

species’ current persistence.

Defending National Marine Fisheries

Service’s Ocean Harvest Management. 

NMFS is charged, under the MagnusonStevens Fishery Conservation and

Management Act, with the difficult task of

managing ocean commercial fishing to not

only provide for conservation and

sustainable fishing, but also to optimize

yield. In several cases, the Division

successfully defended the Service’s

balancing of these objectives. In Legacy

Fishing Co. et al. v. Gutierrez, plaintiffs

challenged Bering Sea fishery measures

which reduce bycatch and waste of fishery

resources. The court accepted the

Division’s arguments that the Service had

adequately considered costs to industry to

the maximum extent practicable consistent

with Magnuson Act conservation standards. 

In Coastal Conservation Ass’n v. Gutierrez,

the Division prevailed against allegations by

the fishing industry that Magnuson Act

standards for rebuilding the red snapper

fishery and for reducing bycatch were

violated. The court there also held that the

Service complied with its obligations under

the National Environmental Policy Act

(NEPA) to analyze alternatives to the

rebuilding plan. In Sherley v. NOAA, the

Division successfully defended NMFS’s

denial of a recreational fishing permit

against multiple challenges. The court held

that the expectation of participating in a

federal fishery was not a protected liberty

interest and that denial of the permit thus did

not violate the right to procedural due

process, that 42 U.S.C. § 1983 was

inapplicable, that the court lacked

jurisdiction over a takings claim, and, in any

event, that the administrative record

supported the denial.

Ensuring the Limitations of Federal

Jurisdiction Are Enforced. The

Administrative Procedure Act and other

special review provisions circumscribe

federal jurisdiction, as do the requirements

of standing and other jurisdictional

prerequisites. The Division prevailed in

several wildlife cases on these defenses. In

Washington State Farm Bureau v. NMFS,

the court dismissed a complaint where

plaintiffs failed to establish standing and

did not demonstrate that they were injured

by the Service’s listing of a population of

killer whales. In Oregon Natural

Resources Council v. Hallock, the Division

prevailed on summary judgment. The court

held that EPA’s oversight of the Oregon

state National Pollutant Discharge

Elimination System (NPDES) program and

its provision of funds to the Oregon

Department of Environmental Quality did

not “federalize” the state program so as to

require ESA consultation on state-issued

NPDES permits regarding the effects on

endangered sucker fish of the discharge of

an herbicide. In Defenders of Wildlife v.

Gutierrez, plaintiffs filed ESA claims

against the Coast Guard for failure to

consult with NMFS regarding the impact of

its recommended traffic separation schemes

on whales. The court dismissed the claims

on the ground that the recommendations,

which went to an international body that set

the schemes, were not final agency actions

subject to judicial review. Similarly, in

Save Our Springs v. Norton, a court held

that a letter from FWS interpreting a Texas

Commission on Environmental Quality

voluntary guidance document was not final

agency action subject to judicial review;

FWS had stated that compliance with the

9
letter, which discussed mitigation of the

effects of storm water runoff, would avoid

“take” of the Barton Springs Salamander

under the ESA. In Conservation Northwest

v. Kempthorne, the Division prevailed

against a claim that FWS should be

compelled to implement specific provisions

of the Grizzly Bear Recovery Plan; the court

held that FWS’s implementation of recovery

plans is committed to agency discretion and

thus not reviewable under the APA. In Gulf

Fishermen Ass’n v Gutierrez, the Division

defended a challenge to Vessel Monitoring

System for Gulf Reef Fish, and the court

dismissed plaintiff’s claims on the ground

that a jurisdictional 30-day limitations

period of Magnuson Act barred suit on all

related claims. In Sea Hawk Seafoods v.

Carlos M. Gutierrez, the Division

successfully argued that a challenge brought

by certain seafood industry plaintiffs to

limits on the Bering Sea fishery were barred

by the Magnuson Act’s 30-day statute of

limitations because the restrictions were

implemented by rule under the Act. 

Restoring the Florida Everglades. The

Division continued to contribute to the

restoration and protection of the Everglades

ecosystem – including the 1.3 million-acre

Everglades National Park, the largest, most

important subtropical wilderness in North

America. In United States v. South Florida

Water Management District, court entered a

consent decree in 1992 requiring the State of

Florida to restore water quality in the

Everglades through regulation of

agricultural runoff and construction of vast

wetland treatment systems. The consent

decree’s “ambitious strategy to restore and

preserve the Everglades ecosystem” – and

the federal-state collaboration that produced

it – have heralded a new era of

intergovernmental cooperation on

Everglades restoration that culminated in

2000 when Congress and the Florida

legislature approved an historic, 30-year,

$7.8 billion restoration effort, fulfilling a

top priority of the past three federal

administrations. This year, the Division

participated in the proceedings of the South

Florida Ecosystem Restoration Task Force,

the intergovernmental body codified by

Congress in 1996 to coordinate the

restoration of the Everglades. The Division

also continued negotiating over additional

water quality restoration measures to

complement those specified in the consent

decree.

In addition, the Division continues

to contribute to protection of the

endangered Everglades ecosystem by

acquiring lands within Everglades National

Park and the Big Cypress National

Preserve, as well as lands critical to the

Army Corps of Engineers’ project to

improve water deliveries in the area.

Restoring the San Joaquin River and

Securing Bureau of Reclamation Project

Water Supplies. The Bureau of

Reclamation’s California Central Valley

Project is one of the Nation’s major water

conservation developments. Seventy years

ago, Congress authorized construction of

the Friant Division of the Project. Friant

Dam diverts all but a fraction of the waters

of California’s second-longest river, the

San Joaquin – de-watering a lengthy reach

of the River for most of the year – for

storage in Miller Lake and eventual

distribution, primarily for agricultural use

in the Central Valley. Earlier, in Natural

Resources Defense Council v. Rodgers, the

Division negotiated a historic settlement of

longstanding litigation over Reclamation

water supply contracts affecting the San

10
Joaquin. When implementing legislation is

enacted, the historic goals of this settlement

will be realized through funding and

implementation of one of the largest river

restoration projects in United States history.

Defense of Federal Property Interests in

Environmentally Sensitive Areas. In

Kingman Reef Atoll Investments, LLC v.

United States, plaintiff sought a ruling that it

has fee simple title to Kingman Reef, a reef

located nine hundred miles off the coast of

Hawaii on which FWS has established a

wildlife refuge of magnificent scope. The

court dismissed the case on limitations

grounds, rejecting plaintiff’s argument that

the government had abandoned Kingman

Reef and should be equitably estopped from

asserting the limitations defense.

Balancing Appropriate Management of

the Missouri River System. The Army

Corps of Engineers has the difficult task of

managing the Missouri River System, which

consists of six dams and reservoirs, for a

variety of overlapping purposes, such as

navigation, flood control, irrigation, and

hydropower. In order to ensure that water

resources decisions best serve these varied

needs, the Corps issued a Master Manual

that describes its water control plan. In

2006, the Corps made changes to the Master

Manual to comply with FWS suggestions in

its biological opinion as to how to protect

the endangered pallid sturgeon. The State of

Missouri sued the Corps, alleging that it had

violated NEPA. The Division successfully

defended the Corps on all claims. 

Upholding Grazing Management

Decisions on Federal Land. In Western

Watersheds Project v. Abbey, environmental

organizations challenged a Bureau of Land

Management grazing management decision

11

for the 325,000-acre Soldier Meadows

Allotment in Nevada, which includes

wilderness areas. The Division prevailed

on summary judgment, with the court

holding that the environmental assessment

on the management decision satisfied

NEPA and that the decision did not permit

new grazing or increased grazing in

violation of the Wilderness Act or the

legislation creating the wilderness areas.

In Stevens County, Washington v.

Department of the Interior, a county and

ranchers challenged a Habitat Management

Plan that eliminated grazing in the Little

Pend Oreille National Wildlife Refuge,

claiming violations of the National Wildlife

Refuge System Administration Act (Refuge

Act), NEPA, and their Fifth Amendment

due process rights. The Division prevailed

on all claims. The district court held that

the agency had exercised the required

“sound professional judgment” under the

Refuge Act; that the FWS complied with

NEPA since plaintiffs had failed to show

that the Plan caused impacts that were not

already examined in a programmatic

environmental impact statement; and that

there was no due process violation because

plaintiffs had no protected interest in

renewal of a grazing permit under the

Refuge Act. 

Protecting the Sierra Nevada Range

from the Risks of Wildland Fire. In

2004, the Forest Service amended the

Sierra Nevada Forest Plan Amendment

(“Framework”) governing 11.5 million

acres in eleven national forests in the Sierra

Nevada region of California in an attempt

to increase desperately needed fuel

treatments to reduce the threats of

catastrophic wildfire while meeting the

habitat needs of species dependent on old
growth forests. This amendment is the

subject of four related lawsuits which

threaten to paralyze forest management

efforts on 11 million acres of federal land. 

Recent success in our continued defense of

the Framework includes the denial of a

preliminary injunction sought against three

projects designed to reduce fire risks near

communities in the Sierra Nevada.

Litigating Federal Forest Land

Management Programs and Policies. The

Division continued to have success in

defending against a variety of challenges to

land management plans and projects. In

Lands Council v. Martin, the Division

prevailed against challenges to the School

Fire Salvage Recovery Project in the

Umatilla National Forest. The court found

the environmental impact statement

adequate under NEPA, and upheld the

Forest Service’s use of a model to estimate

soil erosion. Under the National Forest

Management Act, the court found reliance

on the widely used Scott Guidelines to

determine the probability of tree survival

was reasonable, as was use of the Decayed

Wood Advisor (DecAID) tool. The court

also upheld the Forest Service’s emergency

situation determination and its use of a sitespecific plan amendment to modify the

Forest Plan. The decision as to the Scott

Guidelines, DecAID, and emergency

situation determinations was particularly

important for the agency’s national timber

management program.

The Division reached a beneficial

settlement in Idaho Wildlife Federation v.

Tower, involving management of the sage

grouse under the Management Plan for the

Curlew National Grassland in Idaho. The

Management Plan will continue to stay in

effect and the Forest Service will be able to

achieve its land management objectives for

the Grassland. The Division also

successfully defended the decision to allow

snowmobiles in the proposed West Hoover

Wilderness Addition of the HumboldtToiyabe National Forest. In addition, the

Division obtained a decision allowing the

Bureau of Land Management to proceed

with two timber sales in Klamath Siskiyou

v. BLM. There, the court upheld BLM’s

determination that FWS’s 2004

identification of the Pacific fisher as a

“warranted but precluded” species was not

a significant new circumstance that

required supplementation under NEPA. 

The court deferred to the BLM’s decision

to use northern spotted owl habitat as a

surrogate for Pacific fisher habitat in its

impact analysis and distinguished an earlier

case where the court had held that the

Forest Service violated NEPA by failing to

take a hard look at the impact of logging on

the Southern Sierra fisher. 

The Division also quickly and

decisively prevailed in a challenge to an

administrative decision staying a Bureau of

Land Management order closing a livestock

grazing pasture for the 2007 grazing season

for resource protection purposes. In

Oregon Natural Desert Assn. v. United

States Department of the Interior, the court

granted our request to convert the

preliminary injunction papers into summary

judgment papers, ruling in our favor from

the bench and entering final judgment. The

court held that the administrative decision

to stay closure was supported by substantial

record evidence.

12
CRIMINAL ENFORCEMENT OF OUR ships. PGM was sentenced to pay a $1

NATION’S POLLUTION AND million fine, to pay $500,000 to fund

WILDLIFE LAWS environmental projects on the Chesapeake

Bay and provide environmental education,

Vessel Pollution Prosecutions. The to complete a three-year term of probation,

Vessel Pollution Initiative is an ongoing, and to implement an environmental

concentrated effort to detect, deter, and compliance plan. As part of the ongoing

prosecute those who illegally discharge investigation, four PGM Chief Engineers

pollutants from ships into the oceans, coastal have been convicted of offenses including

waters and inland waterways and who lie APPS violations for falsifying oil record

about such activities. The Division books, conspiracy, and making false

continues to have great success prosecuting statements. Three pled guilty and one was

deliberate violations. convicted after trial. 

In United States v. Overseas In United States v. Ionia

Shipholding Group, the defendant pled Management S.A., et al., the defendant

guilty to and was sentenced on charges that company, a Greek operator, was convicted

it engaged in conspiracy, obstructed justice, by a jury on 18 counts, including falsifying

made false statements, and violated the Act records and presenting false oil record

to Prevent Pollution from Ships (APPS) and books to the Coast Guard, for overboard

the Clean Water Act, as amended by the Oil dumping of waste oil into international

Pollution Act of 1990. The crimes – waters. The second engineer pled guilty

involving twelve OSG oil tankers – occurred and was sentenced to serve a one-year term

between June 2001 and March 2006. The of probation and to pay a $1,000 fine. 

offenses involved intentional falsification of

oil record books to conceal the discharge of In United States v. Petraia

sludge and oil contaminated waste, as well Maritime Ltd., et al., the defendant, a

as bypassing required pollution prevention Swedish owner and operator of the M/V

equipment. OSG was sentenced to pay a Kent Navigator, was convicted on three

total of $37 million in penalties, the largest- APPS violations for failure to maintain an

ever penalty involving deliberate vessel accurate oil record book. Coast Guard

pollution, to serve a three-year term of investigators discovered evidence of illegal

probation, and to implement a stringent bilge waste discharges and concealment of

environmental compliance plan. Of the $37 the discharges. Two chief engineers pled

million, $9.2 will fund environmental guilty to making false entries in the oil

projects coast-to-coast as part of the record book. Each was sentenced to serve

corporation’s required community service. one month’s home confinement as part of a

two-year term of probation and ordered to

 In United States v. Pacific Gulf pay a $3,000 fine.

Marine, Inc., the defendant, an American

shipping company, pled guilty to four APPS In United States v. Chian Spirit

violations involving the illegal discharge of Maritime Enterprises, Inc., et. al., the

hundreds of thousands of gallons of oil- named defendant and its Greek

contaminated bilge waste from four of its owner/operator each pled guilty to one

13
APPS violation, and each was sentenced to

pay $1.25 million for misleading Coast

Guard investigators during an inspection of

the M/V Irene E.M. The ship’s master pled

guilty to presenting false information to the

Coast Guard, and was sentenced to serve a

one-year term of unsupervised probation. 

The Chief Engineer pled guilty to one APPS

violation and was sentenced to serve a oneyear term of unsupervised probation. 

In United States v. Kassian Maritime

Navigation Agency Ltd., et al., the corporate

defendant pled guilty to one APPS violation

for maintaining a false oil record book and

was sentenced to pay a $1 million fine, to

serve 30 months probation, and to pay

$300,000 to fund community service

projects. The chief engineer pled guilty to

making a false statement to the Coast Guard

and was sentenced to pay a $1000 fine.

 In United States v. Sun-Ace Shipping

Company, et al., the corporate defendant

pled guilty to one APPS violation for failing

to maintain an accurate oil record book. 

The company was sentenced to pay a

$400,000 fine and an additional $100,000 in

community service to protect and restore the

natural resources of the Delaware Estuary. 

The Chief Engineer pled guilty to

obstruction of justice and was sentenced to

serve five months in prison followed by two

months of supervised probation. The second

engineer pled guilty to one APPS violation

and was sentenced to serve a three-year term

of probation. 

In United States v. Nicanor Jumalon

et al., the defendant, captain of the M/V

Sportsqueen, pled guilty to obstruction of

justice and was sentenced to serve eight

months in prison for illegally dumping oilcontaminated ballast water from the ship. 

14

The India-based shipping company, Accord

Ship Management Inc., pled guilty and was

sentenced to pay a $1.75 million fine and

serve a three-year term of probation for 

conspiracy, an APPS violation, and two

counts of obstruction for dumping sludge,

bilge wastes, and oil contaminated ballast

water from the ship. The Chief Engineer

also pled guilty to two obstruction

violations and was sentenced to serve five

months incarceration. 

Prosecuting Hazardous Waste and Clean

Air Act Violations. In United States v.

Dennis Rodriguez, the defendant, president

and chief operator of North American

Waste Assistance, pled guilty to three

Resource Conservation and Recovery Act

(RCRA) violations, and was sentenced to

five months incarceration, followed by five

months of house arrest, and a two-year term

of probation. Rodriguez generated a

manifest that stated 84 drums contained

“Non RCRA, Non-regulated hazardous

waste” when the drums actually contained

an expired petroleum-based compound

which was an ignitable hazardous waste. 

Using the false manifest, he delivered the

waste to non-RCRA landfills.

In United States v. Dylan Starnes, et

al., the defendant, who had been convicted

in 2005 on 15 counts, including Clean Air

Act (CAA) and false statement violations,

was sentenced to serve 33 months’

incarceration, followed by a three-year

term of probation. Starnes and his codefendant did not follow asbestos work

practice regulations, and filed false air

monitoring reports related to a remediation

project in a HUD-funded housing project. 

In United States v. Citgo Petroleum

Corporation, et al., Citgo Petroleum and
Citgo Refining and Chemical Company

were convicted on two CAA violations. 

Between 1994 and 2003, the defendants

operated tanks that contained oil without

installing the proper emission controls. 

Citgo Refining and Chemical Company was

also convicted on three misdemeanor

violations of the Migratory Bird Treaty Act. 

The tanks attracted migratory birds, several

of which (including cormorants, pelicans,

and several species of ducks) were killed

after they landed in the open tanks and

became trapped in the oil.

Prosecuting Clean Water Act Violations.

In United States v. Moses, the defendant, an

Idaho real estate developer, used a bulldozer

and other heavy equipment to channelize

and reroute Teton Creek in an attempt to

prevent periodic flooding of an adjacent

subdivision that he had developed. When he

continued these actions despite repeated

orders to stop from state and federal

officials, he was indicted for multiple

violations of the Clean Water Act (CWA). 

He was convicted and sentenced to 18

months in prison and fined $9,000. On

appeal, he argued that he was not required to

obtain a CWA dredge and fill permit

because he only worked in the riverbed

when water had been diverted out of the

river for irrigation purposes. He asserted

that under the Supreme Court’s 2006

decision in Rapanos v. United States, which

was decided after his conviction, the Army

Corps of Engineers lacked regulatory

authority over his actions. The Ninth

Circuit disagreed, holding that the

intermittent flow of the creek resulting from

the upstream division of water for irrigation

purposes did not divest the creek of its status

as a “water of the United States” subject to

the Corps’ regulatory authority under the

CWA. 

In United States v. Sinclair Tulsa

Refining Company, et al., the defendant, a

subsidiary of Sinclair Oil, pled guilty to

two felony CWA violations. Two company

managers each pled guilty to one felony

CWA count for manipulating the sampling

and discharges of wastewater into the

Arkansas River in violation of Sinclair’s

NPDES permit. Sinclair was sentenced to

pay a $5 million fine, pay $500,000 to fund

a community service project on the

Arkansas River, and serve a two-year term

of probation. The managers were each

sentenced to complete a three-year term of

probation, including six months home

confinement. One was ordered to pay a

$160,000 fine and perform 100 hours of

community service, the other an $80,000

fine and 50 hours of community service. 

In United States v. Acquity

Speciality Products, et al., the defendant

pled guilty to one CWA violation and was

sentenced to pay a $3.8 million fine and

complete a three-year term of probation. 

Acquity admitted that from September

1998 until November 2002, while

inspectors conducted sampling, employees

altered the wastewater flow in order to

distort the sampling results. The Director

of Environmental Compliance pled guilty

to conspiracy to violate the CWA and was

sentenced to pay a $5,000 fine and serve a

five-year term of probation. 

Enforcing the Laws Protecting Wildlife. 

In United States v. James Miller, et al., the

defendant was sentenced for his role in

running an illegal, unlicensed big-game

hunting guide operation in Alaska between

1999 and 2001. Miller had previously pled

guilty to one felony Lacey Act charge and

one felony false statement charge and was

sentenced to serve 18 months’ incarceration

15
followed by a three-year term of probation

and to pay $10,650 in restitution. He also

will forfeit his Super Cub aircraft, a hunting

rifle, and several hunting trophies from

illegally-killed big game. 

In United States v. Antonio Vidal

Pego, et al., Pego and Vadilur S.A., a

Uruguayan corporation, each pled guilty to

and was sentenced on charges involving the

illegal importation of Patagonian and

Antarctic toothfish (also known as Chilean

Sea Bass). The government seized more

than 53,000 pounds of toothfish, valued at

$314,397. Pego pled guilty to obstruction of

justice and was sentenced to serve a fouryear term of probation and pay a $400,000

fine. Vadilur pled guilty to false labeling,

importation of illegally possessed fish, and

attempted sale of those fish. The company

was sentenced to a four-year term of

probation and ordered to pay a $100,000

fine, cease all corporate activities, and

dissolve as a business. 

In United States v. Jan Swart, d/b/a

Trophy Hunting Safaris, et. al., Swart, a

South African big-game outfitter, pled guilty

to one felony smuggling violation, and was

sentenced to serve 18 months’ incarceration

followed by a three-year term of probation. 

The charge stems from his involvement in a

scheme to import five hides and three skulls

of leopards illegally killed in South Africa

and smuggled to Zimbabwe, before being

imported through Denver. His co-defendant

pled guilty to one felony Lacey Act false

labeling violation and was sentenced to pay

a $5,000 fine and serve 19 days

incarceration, followed by a three-year term

of probation in South Africa.

In United States v. Jeffrey Diaz, the

defendant pled guilty on November 28,

2006, to two felony smuggling counts and

two felony false statement counts for

smuggling 12 Australian Eagle Owl eggs,

and lying about it on customs forms. He

was sentenced to serve 21 months’

incarceration, followed by a three-year

term of probation, and pay a $5,000 fine. 

The smuggling of the fertile eggs into the

United States from Australia without the

required quarantine period posed a tangible

threat of disease transmission to humans,

including bird flu, as well as a threat to the

commercial poultry industry in the form of

Newcastles Disease. 

In United States v. Michael

Sofoulis, et al., Sofoulis pled guilty to a

misdemeanor violation of the Marine

Mammal Protection Act (MMPA) and was

sentenced to six months’ incarceration,

followed by a one-year term of probation,

ordered to pay a $15,000 fine, plus $5,000

in restitution to the State of Alaska. His

co-defendant pled guilty to conspiracy to

violate the Lacey Act and the MMPA, and

to making false statements, and was

sentenced to serve eight months’

incarceration, followed by a one-year term

of probation. The convictions stemmed

from a scheme to sell walrus headmounts

made from tusks and skulls and

falsification of registration documents. 

In United States v. Princess Cruise

Lines Inc., Princess pled guilty to one

violation of the Endangered Species Act

and was sentenced to pay a $200,000 fine,

pay an additional $550,000 to fund research

in Glacier Bay, Alaska, and serve a fiveyear term of probation. Princess failed to

operate its vessel in a slow, safe speed near

humpback whales in waters near Glacier

Bay National Park. After the event,

Princess imposed a permanent 10-knot

16
speed restriction on all its vessels in nearby

waters.

In United States v. Panhandle

Trading Inc., et al., one individual and two

corporate defendants pled guilty to

conspiracy to violate the Lacey Act and

conspiracy to commit money laundering, for

their roles in an illegal catfish importation

scheme. The individual was sentenced to

serve 51 months’ incarceration followed by

a three-year term of supervised release. 

Both companies will complete five-year

terms of probation, and all three defendants

will be held jointly and severally liable for

$1,139,275 in restitution to the Department

of Homeland Security.

DEFENDING VITAL FEDERAL

PROGRAMS AND INTERESTS

Protecting the Federal Fisc – Royalties

Due to the United States. In BP America

Production Co. v. Burton, oil and gas

companies that hold federal oil and gas

leases on which they owe production

royalties to the federal government argued

that the Interior Department’s Minerals

Management Service (MMS) could not

enforce orders to the companies to reaudit

past payments for inadequacies for more

than the six-year period in the general

statute of limitations in 28 U.S.C. 2415(a). 

The Supreme Court disagreed, holding that

the limitations period pertained only to

damage actions founded on contract brought

by the United States, not to an agency’s

issuance of administrative orders. This

holding will require the oil companies

involved in the law suit to reaudit their

accounts for the years 1989-1996 and could

potentially result in tens of millions of

dollars of royalty payments owed to the

federal government.

Balancing Statutory Mandates -- The

Clean Water Act and the Endangered

Species Act. In National Association of

Home Builders v. Defenders of Wildlife,

et.al; EPA v. Defenders of Wildlife, et.al,

environmental groups argued that the EPA

must comply with the procedural and

substantive requirements of Section 7 of the

Endangered Species Act (ESA) when

deciding whether to delegate to a state its

authority under Section 402 of the Clean

Water Act (CWA) to issue pollution

discharge permits. The ESA requires

federal agencies to consult and assess the

impact of their proposed decisions on listed

species. The CWA requires EPA to

delegate the Section 402 program if a state

satisfies nine criteria, none relating to

endangered species protection. The

Supreme Court, in a 5-4 decision, held that

the ESA did not apply. The majority held

that the court of appeals had erred in

holding that EPA had acted arbitrarily and

capriciously by taking allegedly

contradictory positions on the application

of Section 7 of the ESA. On the merits, the

majority held that the ESA obligations did

not apply because a regulation jointly

promulgated by the agencies charged with

administering the ESA provided that

Section 7 did not apply to agency actions

that were mandatory in nature. Because the

pertinent CWA provisions required EPA to

delegate the permitting program if a state

met the CWA’s requirements, EPA was not

required to comply with ESA Section 7.

Defending Against Encroachment on

Federal Agencies’ Regulatory Authority. 

In Missouri v. Westinghouse, the state and

the corporate defendant sought entry of a

17
proposed consent decree to govern the

cleanup of a former nuclear fuels

manufacturing site. However, federal law

gives the Nuclear Regulatory Commission

exclusive authority to regulate cleanup of

nuclear materials at decommissioned

nuclear facilities. The Division successfully

intervened on behalf of NRC and the

Department of Energy to oppose the

proposed consent decree. The court

accepted the Division’s argument that the

proposed decree would impinge upon the

federal government’s exclusive authority to

regulate nuclear materials. The court

explained that the Atomic Energy Act

preempts state regulation of nuclear

facilities that are being decommissioned and

preempts state regulation of the radiological

portion of mixed wastes.

Ensuring Consistency of United States

Aircraft Engine Emission Standards with

International Standards. In National

Association of Clean Air Agencies v. EPA,

the court affirmed EPA’s decision under the

CAA to conform United States aircraft

engine emission standards to international

consensus standards, against challenges

contending that domestic standards should

be the most stringent possible. The court

held that, in declining to adopt more

stringent standards, EPA reasonably

balanced the costs and additional time

involved in developing and implementing

such standards against the benefits of

conforming domestic aircraft engine

emission standards with existing

international standards and reasonably opted

in favor of the latter.

Defending EPA’s Authority to Interpret

State Law and Regulations in Clean Air

Act Title V Permitting Proceedings. In

two Eleventh Circuit cases, Sierra Club v.

18

Johnson and Glynn Environmental

Coalition v. EPA, the court affirmed EPA’s

decisions not to object to title V operating

permits issued to sources by the State of

Georgia. In both cases, the court confirmed

that EPA’s interpretations of state laws and

regulations that were part of a federallyapproved State Implementation Plan were

entitled to deference.

Defending EPA’s Interpretation of the

Clean Water Act. In June 2006, the

Supreme Court issued a splintered opinion

in Rapanos v. United States on the extent of

federal jurisdiction under the CWA to

regulate wetlands and upstream tributaries

of navigable waters. In numerous cases in

district and appellate courts during FY

2007, the Division has litigated the

meaning of the Rapanos decision and the

extent of federal regulatory jurisdiction. 

After Rapanos, the Sixth Circuit Court of

Appeals remanded United States v. Cundiff,

a civil enforcement action for the illegal

filling of wetlands, to the district court,

which ruled that the United States had

established jurisdiction over the

defendants’ wetlands based on both the test

enunciated by the plurality and the test put

forth in Justice Kennedy’s concurring

opinion in Rapanos. The court ordered

defendants to perform the government’s

proposed restoration plan. 

United States v. Fabian is a CWA

civil enforcement action in connection with

the unauthorized filling of wetlands located

along the Little Calumet River in Indiana. 

The Division obtained a favorable decision

on summary judgment. The court found

that the United States had demonstrated

that defendant’s property contained

wetlands that were within federal

jurisdiction under the CWA and that
defendant had added pollutants to the

wetlands. Regarding regulatory jurisdiction,

the court followed Justice Kennedy’s

concurring opinion in Rapanos and held that

the wetlands were adjacent to a navigablein-fact water (notwithstanding being

separated hydrologically by a 130-foot wide

levee) and, thus, did not require a specific

showing of a significant nexus between the

wetlands and the navigable river. 

In United States v. Bailey, the

Division worked with the U.S. Attorney’s

Office to obtain a favorable ruling in a civil

enforcement action for violations of the

CWA in wetlands adjacent to Lake of the

Woods in Minnesota. The defendant

constructed a one-quarter mile long road in

wetlands abutting the lake. In granting

summary judgment for the government, the

court held that the United States can

establish regulatory jurisdiction under either

Justice Scalia’s plurality opinion, or Justice

Kennedy’s concurring opinion in Rapanos.

The court found the filled areas to be

adjacent wetlands under Justice Kennedy’s

“significant nexus” test and issued a

restoration order requiring removal of fill,

filling drainage ditches, seeding, and

monitoring. 

In P&V Enterprises v. Army Corps

of Engineers, plaintiff sought to challenge,

under the Commerce Clause, the Corps’

regulation defining jurisdiction under

section 404 of the CWA over certain

intrastate waters that “could affect interstate

or foreign commerce.” The Division

prevailed on its motion to dismiss. The

court found that plaintiff had not identified

any basis for equitable tolling of the

limitations period for its facial challenge,

which had long since expired. 

19

Defending the Army Corps of Engineers’

Clean Water Act Permits. The Division

successfully defended permitting decisions

by the Corps under Section 404 of the

CWA in a number of cases.

In Natural Resources Defense

Council v. Army Corps of Engineers,

plaintiffs challenged a regional general

permit issued by the Corps regulating

discharges of dredged and fill material into

waters of the United States in a 48,000-acre

area in the Florida Panhandle. The

Division prevailed on summary judgment. 

Bering Strait Citizens v. Army Corps of

Engineers was a challenge to a CWA

permit issued in connection with the

construction and operation of the Rock

Creek Mine/Mill Complex and the Big

Hurrah Mine, near Nome, Alaska. The

Division successfully defended the permit. 

In Friends of Magurrewock v. Army

Corps of Engineers, the Division defeated a

motion for preliminary injunction seeking

to enjoin a Corps permit issued to the

Maine Department of Transportation to fill

6.8 acres of wetlands and riverbed in

connection with the construction of an

international border crossing between

Calais, Maine, and St. Stephen, New

Brunswick. The district court found that

the Corps had reasonably assessed

practicable locations for the international

border crossing and reasonably concluded

that impacts of the bridge on a nearby

wildlife refuge were speculative. The

Division also defeated a preliminary

injunction motion in Northwest Bypass

Group v. Army Corps of Engineers, an

action seeking judicial review of a permit

issued by the Corps authorizing the filling

of wetlands adjacent to the Turkey River in

Concord, New Hampshire, for construction
of the Langley Parkway South. The court

rejected numerous challenges, including

allegations that the Corps acted improperly

in balancing competing traffic studies,

analyzing alternatives, and considering

cumulative and secondary impacts. This

victory allows a long-planned, important

road construction project to proceed.

Defense of Offshore and Onshore Oil and

Gas Leasing and Operations. Domestic

energy exploration and production continues

to play a critical role in the Nation’s energy

policy as our energy needs grow and access

to foreign energy becomes more uncertain. 

The Division has been instrumental in

implementation of the Nation’s energy

policy. For instance, in North Slope

Borough v. MMS, an Alaska native

corporation and another native interest

group sought to stop an offshore oil and gas

lease sale in the Beaufort Sea for alleged

violations of NEPA. The Division defeated

a motion for preliminary injunction to halt

the lease sale.

The search for new energy resources

is critical to energy independence. In

Northern Plains Resource Council v. BLM

and Northern Cheyenne Tribe v. Norton,

environmental groups challenged the Bureau

of Land Management’s decision authorizing

coal bed methane development in Montana. 

They alleged that the decision violated

NEPA, the Federal Land Policy

Management Act, and the National Historic

Preservation Act. Although the district

court held that further environmental

analysis was needed, it agreed with the

Bureau that some continued development

should be allowed consistent with the option

to elect phased development after the

supplemental analysis was performed. On

appeal, the Ninth Circuit rejected plaintiffs’

20

argument that NEPA required a prohibition

on any development pending the

supplemental analysis and upheld the

narrowly tailored injunction, which allowed

development consistent with the phased

development approach to be studied.

In Chihuahuan Grasslands Alliance

v. Norton, environmental groups challenged

an oil and gas lease sale in the Nutt

Grasslands in Luna County, New Mexico,

alleging that the Bureau’s sale decision

violated the Federal Land Policy

Management Act for failure to properly

solicit public comment and NEPA for,

among other things, relying on a

programmatic environmental impact

statement rather than a sale-specific

environmental analysis. The Division

prevailed on summary judgment on all

counts, obtaining an important holding that

a lease sale does not necessarily mark the

point of irretrievable commitment of

resources because an agency’s subsequent

review of applications for permits to drill

on a leasehold are also subject to further

environmental analysis. 

In Te-Moak Tribe of Western

Shoshone v. Department of the Interior, a

tribe and two environmental groups

challenged the Bureau of Land

Management’s approval of a three-phase

oil and gas exploratory drilling operation

on approximately 30,000 acres in Nevada

under NEPA, the National Historic

Preservation Act, and the Federal Land

Policy Management Act. The Division

secured summary judgment in the Bureau’s

favor on all counts.

Defeating Efforts to Avoid Royalty

Obligations in Mineral Leases. Sound

administration of the Nation’s energy
policy also includes assuring that the

government is appropriately paid by those

who benefit from development of our

mineral resources. The Division’s work has

been important in meeting this goal. In

Devon Energy Corp. v. Norton, an oil

company challenged an Interior Department

decision ordering a restructured accounting

and payment of additional royalties on coal

bed methane produced from federal leases in

Wyoming because the company had

improperly deducted certain costs in

calculating royalties. The district court

granted the Division’s motion for summary

judgment, allowing the recovery of proper

royalties to the benefit of the American

public.

Resolving Challenges to the

Modernization of the Nation’s Airways

and Seaways. Keeping pace with

increasing demands and technological

advancements is a national priority. The

Division aided this effort in a number of

ways. We negotiated a settlement in NRDC

v. Army Corps of Engineers, which will

permit the Corps to proceed with a critically

important project designed to deepen the

navigational channels of the New York/New

Jersey Harbor. On two occasions, the court

found the Corps’ NEPA analysis regarding

this project to be inadequate and remanded

for additional work. The Division thus

worked to reach a settlement that will allow

the Corps to complete its harbor-deepening

project without the threat of future requests

for injunctive relief. The settlement was

based, in part, on pre-existing Corps

obligations and practices and was tailored to

preserve the Corps’ discretion in future

decisions.

Modernization of the “world’s

busiest airport” is the subject of a $6 billion

project designed to make Chicago’s O’Hare

Airport no longer the “nation’s most

delayed airport.” In National Mitigation

Banking Ass’n v. Army Corps of Engineers,

several wetlands mitigation banking groups

brought an action challenging the Corps’

compliance with NEPA and the CWA. The

plaintiffs specifically attacked the Corps’

decision to allow the permittee, the City of

Chicago, to pay a provider $26.4 million to

purchase wetlands mitigation in lieu of

selecting the plaintiffs to provide the

required mitigation. The Division

prevailed on summary judgment against

NEPA and CWA challenges, successfully

defending the controversial in-lieu-fee

mitigation arrangement approved by the

Corps.

Maintaining and Enhancing the Nation’s

Energy Infrastructure. The Division is

often called upon to litigate challenges to

the Nation’s energy infrastructure. For

example, in Border Power Plant Working

Group v. Dep’t of Energy, we successfully

defended a CAA and NEPA challenge to

decisions by the Department of Energy and

Bureau of Land Management to issue

Presidential Permits and rights-of-way over

federal land for transmission lines which

cross the international border in southern

California and connect to power plants in

Mexico. The Division prevailed on all

claims. 

Management of the wastes resulting

from the Nation’s needed energy

production is an important component of

federal energy responsibilities. The

Division defends waste management

decisions from challenges that could

hamper federal efforts to appropriately

direct waste practices. For example,

Coalition on West Valley Nuclear Waste

21
and Joanne E. Hameister v. Bodman

concerned a challenge to the Department of

Energy’s decision about waste management

at the West Valley Demonstration Project

site. The Division prevailed on summary

judgment, with the court finding that the

Department acted appropriately by

completing the interim waste management

process under the circumstances.

Finally, in perhaps the most

ambitious nuclear waste project ever, for

seven years the Division has been

prosecuting litigation in United States v.

State of Nevada, challenging the Nevada

State Engineer’s ruling summarily denying

the Department of Energy’s applications for

permits to use water at Yucca Mountain to

carry out the Department’s mandate under

the Nuclear Waste Policy Act to develop the

Nation’s first high-level nuclear waste and

spent fuel repository. This year, the

Division successfully limited the reach of a

state order seeking to prohibit the

Department’s continuing use of water to

collect data in support of the license

application it intends to submit next year to

the Nuclear Regulatory Commission.

Supporting the Federal Highway

Administration’s Traffic Control

Projects. As our Nation’s population and

cities grow, enhancing the ability of our

highways to safely and efficiently transport

passengers and cargo in an environmentally

sensitive manner has become a more

important and delicate federal task. The

Division plays a significant role in the

Federal Highway Administration’s (FHWA)

efforts to address traffic control and safety

issues. In Davis v. Mineta, plaintiffs

challenged two much needed highway

projects in a rapidly growing urban area near

Salt Lake City, Utah. In addition to project22

specific claims under NEPA, plaintiffs

broadly challenged the manner in which

FHWA fulfills its environmental analysis

obligations. Plaintiffs asserted that the

Agency should be required to conduct

broad programmatic analyses on the entire

State Transportation Improvement

Program, not just on individual projects. 

Such an obligation would have broad

ramifications agency-wide. With close

coordination with our co-defendant, the

State of Utah, we ultimately prevailed on

all issues.

In Conservation Law Foundation v.

FHWA, the court issued a largely favorable

decision on summary judgment regarding

NEPA and Federal-Aid Highway Act

(FAHA) challenges to a FHWA decision to

fund the widening of a 19.8-mile stretch of

Interstate 93 between Salem and

Manchester, New Hampshire. This matter

was litigated jointly with the State of New

Hampshire. The court found in favor of

defendants on NEPA claims regarding

consideration of alternatives and the

analysis of direct and cumulative impacts

and on the FAHA claims. The court

ordered a limited remand for preparation of

a supplemental environmental impact

statement on certain issues, but allowed the

project to proceed.

Securing Needed Water Rights for the

United States. This year the Division

entered into numerous settlements, or

secured favorable judgments, that will

protect the water supplies and flows

necessary to maintain the vitality of natural

resources and uses of the public lands,

national forests, national parks, wildlife

refuges, wild and scenic rivers, military

bases, and federal reclamation projects

throughout the West. For example, in the
Klamath Basin Adjudication, the major

general stream adjudication in the State of

Oregon, the Division secured rulings

granting FWS’s claims in their entirety for

the Lower Klamath and Tule Lake National

Wildlife Refuges. These rulings recognize

the United States’ right to divert and use

hundreds of thousands of acre-feet of water

per year to meet Refuge purposes. In State

of Washington Department of Ecology v.

Acquavella, a general stream adjudication of

water rights in the Yakima River Basin, the

Division secured a favorable decision

confirming the Bureau of Reclamation’s

state-based water rights, both for its

federally owned facilities and for its water

delivery obligations to other parties, on

terms that provide the Bureau with extensive

discretion in managing the Yakima Project. 

The Division’s successes do not

always take the form of water rights

determinations. Sometimes, collateral

issues are critical too, as illustrated by In Re

Snake River Basin Adjudication, the general

stream adjudication covering 87% of the

State of Idaho. There, the Idaho Supreme

Court upheld a decision denying an award of

attorney’s fees against the United States. In

this case of first impression, the court ruled

that Congress has not authorized state courts

to impose liability on the United States for

other parties’ attorney’s fees. This decision

will protect the public fisc from substantial

potential liabilities in Idaho, where the

United States is litigating in support of

federal water interests in adjudications

involving thousands of potential claimants. 

Upholding Government to Government

Relations with Tribes. The Division

successfully defended Bureau of Indian

Affairs (BIA) decisions affecting its

government to government relations with

23

tribes. In St. Pierre v Kempthorne, the

Division prevailed in a case involving a

longstanding dispute over the government’s

action in approving a constitutional

amendment that altered the membership

standards of the tribe. The court found the

tribe an indispensable party to the

adjudication of the validity of challenges to

the tribal constitution and, alternatively,

gave res judicata effect to tribal court

adjudications that sought to resolve the

same issues. This ruling is strong

precedent to prevent dissident tribal

members from interfering with the

government’s dealings with tribal

governments and provides substantial

support for the finality of tribal court

resolutions for intra-tribal disputes.

In Vann v. Kempthorne, we

successfully resisted two preliminary

injunctions that would have limited our

ability to engage in government to

government relations with the Cherokee

Nation, prevented the BIA from

recognizing a tribal election, and prohibited

distributing money to the tribe. Plaintiffs

claimed the Cherokee Nation’s leadership

took actions to eliminate Cherokee

Freedmen (descendants of former slaves of

the tribe) from tribal membership and

deprive them of voting rights contrary to a

treaty with the United States. The court,

while concerned about the treatment of the

Cherokee Freedmen by the Cherokee

Nation, chose to allow the BIA to provide

funding to the tribe and deal with the

Nation’s leadership. This allowed the BIA

to take actions it believes to be both in the

interest of the Cherokee Nation as a whole

and in the interests of the Freedmen, while

respecting tribal sovereignty.
Protecting Taxpayers Against

Unwarranted or Excessive Claims. An

important part of the Division’s work is

defending against unwarranted claims that

federal actions impinge upon private

property interests and, in cases where

private property has been taken in

furtherance of public purposes, determining

the proper compensation due to property

owners. The Division has an exemplary

record in these cases in ensuring that the

United States does not pay unwarranted

claims or excessive amounts.

In Stockton East Water District v.

United States, plaintiffs sought $500 million

based on the alleged failure of the Bureau of

Reclamation to deliver water to several

California water districts under their water

service contracts. The United States

prevailed after a multi-week trial. The court

held that the water districts did not show

that the Bureau made unreasonable

decisions in operating the reservoir and

allocating water under a contract that

required the Bureau to “use all reasonable

means to guard against” water shortages. 

Similarly, Klamath Irrigation District v.

United States involved claims for

compensation in the amount of $100 million

based on the alleged failure of the Bureau of

Reclamation to deliver water from the

Klamath Project, based on the Bureau’s

compliance with the ESA. Following

previous decisions holding for the United

States as to specific claims, the United

States obtained a decision this year holding

that the Sovereign Acts Doctrine provided a

complete defense, since the ESA was passed

for the benefit of the public and did not

involve the government acting as a

contractor.

24

In Testwuide v. United States,

approximately 3400 plaintiffs owning

property in Virginia near two naval bases

alleged Fifth Amendment takings claims

based on an increase in military aircraft

overflight activity as a result of mandated

base closures and consolidations. The

United States settled these claims under

favorable terms, thus avoiding the risk of a

far greater monetary cost.

On occasion, the Fifth Amendment

takings claims faced by the Division rise to

staggering levels. In Nicholson v. United

States, which arose out of the flooding

caused by Hurricane Katrina, plaintiffs

alleged that the faulty design and

construction of the New Orleans levee

system caused a taking of their properties. 

Plaintiffs sought class certification and

asserted claims of $100 billion. The United

States prevailed on summary judgment,

with the court finding that the flooding was

not the natural and probable consequence

of governmental action.

Acquiring Property for Public Purposes.

The Division exercises the federal

government’s power of eminent domain to

enable agencies to acquire land for various

purposes, including property needed for

new or expanded courthouses, for flood

control projects, for federal office

buildings, and for access to federal

facilities. 

In the course of this work, the

Division is mindful of its goal to achieve

results just to individual landowners and to

the taxpayers of the United States. 

Through settlements and trials, the Division

achieved results that amounted to savings

of some $18.6 million dollars. It also

achieved beneficial results by working with
agencies to avoid the expense of litigation

where possible. For example, in a situation

requiring installation of security measures

around the federal district courthouse in

Manhattan, the Division worked with GSA

to devise a right of use that avoided

litigation altogether. 

Enforcing Environmental Laws Through

International Capacity Building. The

Division frequently provides training on

civil and criminal environmental

enforcement to judges, prosecutors and

other government attorneys, and other legal

practitioners in foreign countries. Division

attorneys engaged in such capacity building

traveled to numerous countries, including

Panama, China, Taiwan, Indonesia,

Thailand, Hungary, Denmark, the

Netherlands, the United Arab Emirates, the

Kingdom of Bahrain, Egypt, Tanzania, and

Mexico. The Division worked with

government attorneys from Mexico and

Canada to develop and present a conference

in February 2007 on environmental

enforcement issues for Mexican judges and

magistrates in Mexico City. The

symposium was sponsored by the

Enforcement Working Group of the

Commission on Environmental Cooperation,

an international organization created under

the North American Agreement on

Environmental Cooperation. Division

attorneys also served as instructors in

workshops for judges and prosecutors in the

Philippines and Indonesia on prosecuting

cases to combat illegal trade in wildlife and

wildlife parts. These workshops were

organized in conjunction with the

Association of Southeast Asian Nations

Wildlife Enforcement Network (ASEANWEN). Division attorneys also participated

in several capacity building efforts to

strengthen enforcement responses to oil

25

pollution from vessels; attorneys planned

and staffed a multi-agency training mission

to Taiwan which provided in-depth training

to several Taiwanese agencies concerning

identification of and investigation of vessel

pollution violations. The Division also

helped organize meetings with visiting

foreign enforcement and other government

officials from countries such as China,

Japan, Indonesia, Vietnam, and Chile. 

Protecting the Interests of the United

States in Litigation Involving Third

Parties. The Division at times participates

in cases in which the United States is not a

party to protect the interests of the United

States and its component agencies. Such

participation may be in district court, in a

court of appeals, or in the Supreme Court;

we also participate at times in state court

proceedings. The Division has filed briefs

in a number of such proceedings in the past

year. In Northwest Environmental Defense

Center v. Brown, we filed a brief in federal

district court on the issue of whether a

CWA NPDES permit is required for

forestry roads. The court agreed with our

view that such permits are not required. 

Another example is BGA/Western Mohegan

Tribe v. Ulster County. In that case, a

group of Native Americans sought a ruling

from a federal district court that could have

suggested that they had some of the

attributes of a federal Indian tribe. The

Division filed an amicus brief explaining

that recognition as a federal Indian tribe

could be granted only by the Department of

the Interior and that the suit was improper. 

The court agreed.
PROMOTING NATIONAL SECURITY

AND MILITARY PREPAREDNESS

Defending the Army’s Chemical Weapons

Demilitarization Program. The Division

has successfully defended the Army against

challenges to its program to destroy aging

stockpiles of chemical weapons pursuant to

international treaty obligations. In Sierra

Club v. Army, plaintiffs challenged the

Army’s destruction of a chemical nerve

agent under the Resource Conservation and

Recovery Act. The destruction process

involves neutralizing the deadly liquid agent

at one location, then shipping the resulting

product to a commercial hazardous waste

incinerator. Plaintiffs alleged that the

chemical agent is not fully neutralized in the

treatment process and that trucking the

resulting product thus presents risks. The

Division defeated plaintiffs’ motion for a

preliminary injunction. The court held that

the Army properly considered all the

available evidence when it concluded that

the post-neutralization product could be

classified as a caustic hazardous waste after

treatment and that the Army took the

necessary hard look at the environmental

impact of its plan to ship that product. This

decision allows this important program, vital

to national security, to proceed without

interruption.

An Oregon court issued a largely

favorable decision in G.A.S.P. v. Army,

upholding state-issued permits for the

incineration of chemical weapons at the

Army’s facility in Umatilla, Oregon. The

court remanded to the state permitting

agency on two relatively minor issues, but

held that the facility may continue

incinerating chemical weapons during the

remand because petitioners had not shown

26

that the operations were having an adverse

effect on public health or the environment. 

Aiding the Military’s Training,

Preparations and Deployment in the

War on Terrorism. After nearly three

years of litigation in Ilioulaokalani

Coalition v. Gates, the Division this year

achieved an important victory in its defense

of a key component of the Army’s 30-year

modernization plan, “Stryker conversion”

activity at an Army training facility in

Hawaii. The Division secured partial relief

from an injunction that had prohibited all

conversion and training activity while the

Army worked to complete additional

documentation under NEPA. With this

relief, the Army was able to immediately

resume every conversion project and

training activity it had identified as critical

for ensuring that the 2nd Brigade, 25th

Infantry Division is provided with training

and weapons systems needed to

successfully fight the global war on

terrorism.

Protecting the Navy’s Ability to Use

Sonar in Training Exercises. The

Division represents the Navy in several

cases that challenge the Navy’s use of midfrequency active sonar throughout the

world and in specific training exercises off

the coast of California and Hawaii, as well

as its use of low-frequency sonar, a new

technology for anti-submarine warfare that

is still in the experimental phase. These

high-profile cases are critically important to

the Nation’s security and military

readiness.

Property Acquisitions to Improve

Military Readiness and National

Security. As requested by federal agencies

acting under authority of Congress, the
Division exercised the federal government’s

power of eminent domain to initiate

litigation enabling land acquisitions for

military readiness and national security.

The Division filed new cases for

such diverse military installations as the

Navy’s Air Facility, El Centro; the Harvey

Point Defense Testing Facility; the Naval

Computer and Telecommunications Area

Master Station; the Army’s Gowen Field

Training Area in Idaho; and the Air Force’s

Seymour Johnson Air Force Base and Travis

Air Force Base. In addition, it continued its

litigation efforts in existing cases such as

that involving property at Eielson Air Force

Base in Alaska, a case which concerns

complex lease issues arising from the

military’s “section 801 housing” project,

pursuant to which the military leased land

on installations to private developers who

constructed military housing that was leased

back to the military.

In addition, the Division has filed

nine new cases to provide national security

along the country’s northern and southern

borders. For example, at the northwestern

and northeastern borders, it filed actions to

acquire property for two new or expanded

ports of entry. One suit, which seeks land

for the expanded border station at Blaine,

Washington, involved the condemnation of

the State’s interest in portions of Interstate-5

just south of the boundary between the

United States and Canada; the plan is to

construct the border station and then

reconstruct the affected portions of

Interstate-5 as a bridge over the border

station, all on an expedited basis in

anticipation of 2010 Winter Olympics in

Vancouver. At the southwestern border, the

Division has filed suit to acquire part of the

property needed for the Multi-Tiered Fence

Project.

PROTECTING INDIAN RESOURCES

AND RESOLVING INDIAN ISSUES

Protecting Tribal Hunting, Fishing, and

Gathering Rights. The Division litigates 

to defend treaty-protected tribal hunting

and fishing rights. In United States v.

Michigan, the United States, five tribes, the

State of Michigan, and Michigan hunting

and conservation groups successfully

negotiated a comprehensive settlement that

affirms the existence and extent of the

inland hunting and fishing rights of the Bay

Mills Indian Community, the Sault Ste.

Marie Tribe of Chippewa Indians, the Little

Traverse Bay Bands of Odawa Indians, the

Grand Traverse Band of Ottawa and

Chippewa Indians, and the Little River

Band of Ottawa Indians. The agreement

resolves a long-standing dispute over

whether the Tribes retained hunting and

fishing rights pursuant to the 1836 Treaty

of Washington. The agreement resolves

litigation ongoing since the 1970s.

In United States v. Washington, a

long-running case involving tribal treaty

fishing rights in Western Washington, the

court issued a decision in favor of the

United States and numerous Indian tribes,

holding that the Tribes’ treaty-secured

rights of taking fish impose a duty on the

State of Washington to improve culverts

that hinder fish passage and diminish fish

populations.

Defending Tribal and Federal Interests

in Water Adjudications. During the past

year, the Division successfully represented

the interests of Indian tribes in complex

water rights adjudications. The Division,

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working with the Interior Department, the

State of Washington, private water users,

and the Lummi Indian Nation, negotiated a

comprehensive settlement of a significant

water rights lawsuit involving groundwater

underlying the Lummi Reservation in

United States v. Washington Department of

Ecology. In another major water rights case,

the Division successfully argued in both

federal and state court for entry of a consent

decree effectuating the Gila River Indian

Community Water Rights Settlement. The

settlement brings critical water resources to

the Gila River Indian Community’s

Reservation and resolves long-standing

issues regarding water use. 

The Division also prevailed in two

trials that focused on amending two 1991

consent decrees settling decades-old

litigation involving water rights on the

Animas and La Plata Rivers in Colorado. In

four consolidated cases brought on behalf of

the Southern Ute and Ute Mountain Tribes,

the court agreed, over objections, to amend

consent decrees in order to make them

consistent with legislation concerning the

Animas-La Plata water project.

State of Maine v. EPA involved a

petition for review of EPA’s decision

authorizing the State of Maine to administer

the CWA permitting program in the

territories of the Penobscot Nation and

Passamaquoddy Tribe, but retaining federal

authority to issue permits for certain

tribally-owned facilities with operations that

EPA concluded are internal tribal matters. 

The First Circuit affirmed EPA’s decision

granting authority to the State to administer

the program within the Tribes’ territory, but

vacated EPA’s decision to retain permitting

authority as to certain tribally-owned

facilities. The decision, which turned on

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construction of the Maine Indian Claims

Settlement Act, clarifies the respective

roles of the State and the Tribes in

administering the CWA in Maine. 

Upholding Agencies’ Authority to

Implement Indian Policies. The Division

has achieved considerable success in

defending the Secretary of the Interior’s

trust land acquisition authority against

numerous constitutional and administrative

law challenges. These decisions have

strengthened the authority of the Secretary

to provide for tribes’ physical, economic,

and political well-being.

Defending Tribal Trust Claims. The

Division represents the United States in

numerous cases that tribes have brought

demanding accountings and alleging breach

of trust and other claims relating to funds

and non-monetary assets (such as timber

rights, oil and gas rights, grazing, mining

and other interests) on some 45-million

acres of land that the United States holds in

trust for tribes. There are more than 100

cases ongoing in several courts and these

cases are in various stages of discovery,

active pretrial preparation, and formal or

informal settlement discussions.

SUPPORTING THE DIVISION’S

LITIGATORS

Award Winning Quality of Life. The 

Division was voted the second best place to

work in the federal government (out of the

222 agency component offices) in the “Best

Places to Work in the Federal Government

2007” survey. 

The Division also was honored to

receive the “Constance L. Belfiore Quality

of Life” Award from the Bar Association of
the District of Columbia – the first

government law office to be so honored in

the 10-year history of the award. This

award recognized the Division for its quality

of work, collegiality, attorney development

and mentor programs, and service to the

community. 

The Human Resources staff also

completed the second year of its innovative

“Honors Paralegal Program,” which makes

use of the hiring authority in the Federal

Career Intern Program. Each new Honor

Paralegal was provided a three-day

orientation program and paired with an

attorney mentor, which has proven

enormously helpful in getting the new staff

integrated into the work of the Division.

The Office of Human Resources has

implemented an on-line orientation program

that allows new employees to complete

time-consuming forms in advance of their

first day, saving valuable time and

resources.

In 2007, the Division had an

outstanding performance fulfilling the

President’s Management Agenda, with the

highest “green” performance scores in every

rating category for which the Division is

monitored. 

New Technology Resources and

Upgrades. The Division upgraded all

printers and servers, increased bandwidth,

updated our backup equipment, and made

additional improvements to our system

architecture and network structure. The

upgrades will pave the way for a new

desktop system in the near future. The

Division also upgraded and replaced its

BlackBerry PDAs, enabling staff to remain

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highly efficient with the use of current

mobile technology.

The Division also rolled out a new

Intranet module with resources for

environmental enforcement litigators. The

new EESNet contains a wealth of

information and resources relevant to work

under various environmental statutes. 

Substantive legal resources include EPA

and DOJ guidance to litigators, judicial and

administrative models, policies, outlines,

overviews, and case updates. Management

resources provide trial schedules, staffing

lists, and consent decree and complaint

libraries sorted by year and statue. This

site will serve as a prototype for other

practice area intranet pages.

The Division expanded its unique

mail scanning program this year to provide

greater technical capability. Mail now is

scanned directly into the Division’s

document management software, ensuring

that electronic copies are made available

immediately to multiple recipients in their

offices or in remote locations while

teleworking, on travel, or during

emergencies requiring employees to work

from offsite locations.

The Division’s Office of Litigation

Support provided outstanding automation

support services for our largest and most

complex cases. Our Litigation Support

program combines cutting edge legal

technology, experienced contract staff, and

extensive in-house expertise. OLS

expanded the Division’s Extranet, allowing

trial teams to more effectively collaborate

on case materials with agency counsel,

investigators, and expert witnesses by

routinely making new cases available

through our secure Internet portal.