Court Opinion

ID: 1042154
Source: CourtListenerOpinion
Date Created: 2013-09-26 16:37:32.818265+00
Date Added: 2024-06-11T15:39:07.852360
License: Public Domain

NOT PRECEDENTIAL

                         UNITED STATES COURT OF APPEALS
                              FOR THE THIRD CIRCUIT
                                   _____________

                                       No. 12-4160
                                      _____________

                       MINARD RUN OIL COMPANY;
           PENNSYLVANIA INDEPENDENT OIL AND GAS ASSOCIATION;
                   ALLEGHENY FOREST ALLIANCE;
                   COUNTY OF WARREN, PENNSYLVANIA

                                             v.

         UNITED STATES FOREST SERVICE, an agency of the U.S. Department of
 Agriculture; ABIGAIL R. KIMBELL, in her official capacity as Chief of the U.S. Forest
  Service; KENT P. CONNAUGHTON, in his official capacity as Regional Forester for
the U.S. Forest Service, Eastern Region; LEANNE M. MARTEN, in her official capacity
                 as Forest Supervisor for the Allegheny National Forest;
                 ATTORNEY GENERAL UNITED STATES OF AMERICA;
            FOREST SERVICE EMPLOYEES FOR ENVIRONMENTAL ETHICS;
                     ALLEGHENY DEFENSE PROJECT; SIERRA CLUB

                   ALLEGHENY DEFENSE PROJECT; SIERRA CLUB,
                                                       Appellants

                   On Appeal from the United States District Court
                       for the Western District of Pennsylvania
                            (D.C. Civil No. 1-09-cv-00125)
                    District Judge: Honorable Sean J. McLaughlin

                           Argued on September 11, 2013

                         (Opinion Filed: September 26, 2013)

        Before: RENDELL, JORDAN and GREENAWAY, JR., Circuit Judges
Marianne G. Dugan, Esquire (Argued)
259 East 5th Avenue
Eugene, OR 97401
                    Counsel for Appellants

J. Michael Klise, Esquire
R. Timothy McCrum, Esquire (Argued)
Thomas R. Lundquist, Esquire
Providence Spina, Esquire
Crowell & Moring, LLP
1001 Pennsylvania Avenue, N. W.
Washington, DC 2004-2505

Steven J. Lechner, Esquire
Mountain States Legal Foundation
2596 South Lewis Way
Lakewood, CO 80227

Matthew L. Wolford, Esquire
638 West Sixth Street
Erie, PA 16507
                    Counsel for Appellees

                                      OPINION

RENDELL, Circuit Judge:

       The Allegheny Defense Project and Sierra Club (collectively “Appellants”) appeal

from the District Court’s order granting summary judgment for the Minard Run Oil

Company and Pennsylvania Independent Oil and Gas Association (collectively

“Appellees”), essentially converting a preliminary injunction into a declaratory judgment.

The issue raised on appeal is whether the District Court properly applied the law of the

                                             2
case doctrine to preclude arguments raised by Appellants in their cross-motion for

summary judgment. For the reasons that follow, we will affirm the District Court’s order.

                                              I.

       This case arises from a dispute over the split-estate property rights of the federal

surface owner and private mineral rights owners in the Allegheny National Forest

(“ANF”). The facts of the case have already been extensively detailed in preceding

opinions, so we will only summarize facts relevant to this appeal.

       The United States acquired the surface estates that now constitute the ANF

pursuant to the Weeks Act of 1911. While the U.S. Forest Service (“the Service”)

manages the surface of the ANF, the mineral rights in most of the ANF are privately

owned. From 1980 until recently, the Service and private mineral rights owners utilized a

cooperative process to manage access to and use of the surface to drill for oil and gas.

Sixty days prior to any planned drilling, mineral rights owners would provide notice to

the Service, and the Service would then issue a Notice to Proceed (“NTP”),

acknowledging receipt of the owners’ notice and memorializing any agreements relating

to the planned drilling. In 2008, a number of environmental groups, including the Sierra

Club, filed a lawsuit against the Service, stating that its policy of issuing NTPs

constituted a “major federal action[] significantly affecting the quality of the human

environment,” under the National Environmental Policy Act of 1969 (“NEPA”), 42

U.S.C. § 4332(c), and that therefore an NTP could not lawfully be issued before the

appropriate environmental analysis under NEPA (an environmental impact study, or

“EIS”) was conducted. In 2009, the parties to that litigation entered into a Settlement

                                              3
Agreement, requiring that the Service conduct the appropriate NEPA analysis prior to

issuing further NTPs. Subsequently, the Service issued a statement to oil and gas

companies operating in the forest, stating that no new drilling would be authorized until

the forest-wide EIS was completed.

       In June 2009, mineral rights owners, including Appellees, filed a complaint in the

District Court arguing that the de facto ban on drilling in the ANF exceeded the authority

of the Service because a NEPA analysis was not required as a matter of law. The District

Court granted their motion for a preliminary injunction, and on appeal, we affirmed in a

precedential opinion. See Minard Run Oil Co. v. U.S. Forest Service, No. 09-125, 2009
WL 4937785 (W.D. Pa. Dec. 15, 2009) (“Minard Run II”); Minard Run Oil Co. v. U.S.

Forest Service, 670 F.3d 236 (3d Cir. 2012) (“Minard Run III”). We reasoned that: (1)

under the Weeks Act, both outstanding and reserved private mineral rights are subject to

federal control only to the extent Service regulations are contained in the written

instrument of conveyance; (2) the issuance of an NTP is, therefore, not a major federal

action under NEPA; and (3) consequently, an EIS need not be completed prior to issuing

an NTP. Minard Run III, 670 F.3d at 251-52, 254.

       Thereafter, the mineral rights owners moved for summary judgment in the case

before the District Court, requesting entry of judgment in their favor, conversion of the

preliminary injunction order into a final declaratory judgment, and a permanent

injunction against the Service. Appellants filed a cross-motion for summary judgment

seeking vacation of the preliminary injunction order and judgment in their favor. The

District Court granted the mineral rights owners’ motion in part (it denied the request for

                                             4
a permanent injunction), concluding that the arguments advanced by Appellants were

“precluded by the application of the law of the case doctrine and/or otherwise lack[ed]

merit” because our prior opinion had decided the very issue before it. Minard Run Oil

Co. v. U.S. Forest Service, 894 F. Supp. 2d 642, 654 (W.D. Pa. 2012) (“Minard Run IV”).

The Court vacated the Settlement Agreement, and converted its preliminary injunction

order into a final declaratory judgment on the merits. It is this order that is challenged on

appeal.

                                             II.

       Appellants argue that, for three reasons, the District Court improperly applied the

law of the case doctrine to this Court’s ruling in Minard Run III : (1) the Court did not

provide the parties with notice that its ruling on the preliminary injunction motion would

reach the merits; (2) in general, a decision on a preliminary injunction does not constitute

the law of the case for purposes of the merits since the standard for a preliminary

injunction is “likelihood of success,” not actual success; and (3) the Minard Run III panel

only reached the merits on the specific question of whether the Service’s moratorium was

required by NEPA and consistent with the APA. Finally, Appellants argue that even if the

law of the case doctrine is applicable to Minard Run III, an exception applies as

“reconsideration is necessary to prevent clear error or manifest injustice.” Appellants’ Br.

at 54 (quoting ACLU v. Mukasey, 534 F.3d 181, 188 (3d Cir. 2008) (internal quotation

marks omitted)). These arguments are unavailing.

       With respect to Appellants’ first and second arguments, the District Court properly

considered our holdings in ACLU v. Mukasey, and Pitt News v. Pappert, 379 F.3d 96 (3d

                                              5
Cir. 2004), in determining that the Minard Run III court had not stopped its analysis after

concluding that Plaintiff-Appellees were likely to succeed on the merits of the

preliminary injunction, but instead had decisively resolved the legal claims presented on

appeal. See Minard Run IV, 894 F. Supp. 2d at 653-54. In Pitt News, we clearly stated:

       [A]lthough a panel entertaining a preliminary injunction appeal generally
       decides only whether the district court abused its discretion in ruling on the
       request for relief and generally does not go . . . any farther than is necessary
       to determine whether the moving party established a likelihood of success,
       a panel is not always required to take this narrow approach. If a preliminary
       injunction appeal presents a question of law and the facts are established or
       of no controlling relevance, the panel may decide the merits of the claim.
379 F.3d at 104-105 (citations and internal quotation marks omitted). This principle was

reaffirmed in Mukasey, where we expressly held that portions of a decision on an appeal

of a preliminary junction had in fact reached the merits of the underlying claim. 534 F.3d

at 188-90. To the extent that Appellants argue that they were not given adequate notice

that the decision on the motion for a preliminary injunction would reach the merits,

Mukasey and Pitt News served as notice that this was a real possibility.1

1
  Appellants state that the District Court frustrated the purpose of Rule 65(a)(2) of the
Federal Rules of Civil Procedure in failing to provide notice that it was transforming a
preliminary injunction proceeding into summary judgment. Appellants’ Br. at 50-51.
First, the District Court did not transform the preliminary injunction hearing into a
hearing on summary judgment. The District Court, in applying the law of the case in
Minard Run IV, did not state that it had reached the merits of the claims in its
consideration of the preliminary injunction; it held that the this Court had done so on the
appeal in Minard Run III. Second, Rule 65(a)(2) describes courts’ right to consolidate a
trial on the merits with a hearing on a preliminary injunction. The Rule makes no mention
of summary judgment, rather it emphasizes that courts must preserve any party’s right to
a jury trial. In reaching the merits of the claims presented, this Court acted squarely
within the bounds of its authority, particularly given the extensive briefing and hearings
spanning several months that had taken place.
                                              6
       Furthermore, these opinions provided notice that such a decision would have

binding effect on decisions by subsequent panels. In Pitt News, we stated, “[I]f the first

panel does not stop at the question of likelihood of success and instead addresses the

merits, the later panel, in accordance with our Court’s traditional practice, should regard

itself as bound by the prior panel opinion.” 379 F.3d at 105 (referring to the law of the

case and Third Circuit Internal Operating Procedure 9.1).2 Any conclusions as to the

merits of Appellants’ claims reached by the Minard Run III panel are binding upon this

Court since the panel made a precedential ruling.

       This brings us to the question raised by Appellants’ third argument, which is: what

conclusions on the merits did the Minard Run III panel actually reach? Appellants argue

that the only conclusion on the merits, rather than on the likelihood of success, that the

Court reached was that the Service’s moratorium on issuing NTPs, specifically, was

unlawful. Appellants’ Br. at 53. Appellants seem to suggest that if the panel wished to

rule on the merits on any other legal issues, it should have explicitly stated its intention to

do so. This simply is not required of the Court. The panel in Minard Run III could not

have been more clear in indicating that it was not stopping its analysis after concluding

that Appellees were likely to succeed on the merits of their preliminary injunction, but

rather was ruling on the underlying legal claims.

2
  Third Circuit Internal Operating Procedure 9.1 reads, “It is the tradition of this court
that the holding of a panel in a precedential opinion is binding on subsequent panels.
Thus, no subsequent panel overrules the holding in a precedential opinion of a previous
panel. Court en banc consideration is required to do so.” Though the District Court was
not bound by Internal Operating Procedure 9.1, this Court undoubtedly is.
                                               7
       We will not repeat Judge McLaughlin’s thorough analysis of the binding effect of

the Minard Run III opinion, but will merely add that Appellants in their briefing, appear

to concede that the Court reached the merits on other legal claims. For example,

Appellants state, “The district court and this Court’s preliminary [injunction] ruling

properly found that the USFS’s moratorium was unreasonable and illegal. By going

further, both rulings unnecessarily and improperly construed the Weeks Act as restricting

USFS’s ability to reasonably regulate access to the surface in order to protect the federal

estate.” Appellants’ Br. at 21-22. To call the Court’s construction of the Weeks Act

unnecessary, or to imply that it was dicta, is essentially to claim that a court may never

actually reach the merits at the preliminary injunction stage. That is not the case. Cf.

Thornburgh v. Am. Coll. of Obstetricians & Gynecologists, 476 U.S. 747, 756-57 (1986),

overruled on other grounds, Planned Parenthood of Se. Pa. v. Casey, 505 U.S. 833

(1992); Pitt News, 379 F.3d at 104-05.

       In their cross-motion for summary judgment, Appellants pointed to legislative

history and state law which was not presented at the preliminary injunction stage. They

also directed the District Court to reconsider the Minard Run III panel’s interpretation of

a number of cases including Kleppe v. New Mexico, 426 U.S. 529 (1976) and United

States v. Srnsky, 271 F.3d 595 (4th Cir. 2001). These arguments could have been raised

earlier and are precisely the kinds of arguments precluded from consideration under the

                                              8
law of the case.3 Accordingly, the District Court did not need to address these arguments

unless an exception to the doctrine applied.4

       We may revisit a legal question which has already been resolved where any of the

following “extraordinary circumstances” exist: “‘(1) there has been an intervening change

in the law; (2) new evidence has become available; or (3) reconsideration is necessary to

prevent clear error or a manifest injustice.’” Mukasey, 534 F.3d at 188 (quoting Council

of Alternative Political Parties v. Hooks, 179 F.3d 64, 69 (3d Cir. 1999)). Appellants

contend that the third exception to the application of the law of the case is implicated

here. They state that this Court’s ruling that Section 9 of the Weeks Act provides that

reserved mineral rights are subject only to regulations in the instrument of conveyance,

was clearly erroneous. In Minard Run III, however, Judge Roth provided ample

reasoning for the Court’s statutory interpretation, which Judge McLaughlin quoted at

length in Minard Run IV. See Minard Run IV, 894 F. Supp. 2d at 657-58 (quoting Minard

Run III, 670 F.3d at 251-52). To the extent that Appellants simply disagree with the

3
  Appellants also suggest that they have further developed the factual record by
presenting deeds containing different language than the 1911 rules and regulations
previously considered by this Court, but these deeds do not change the binding effect of
our prior interpretation of the reserved rights. Our determination that the 1911 regulations
were the standard version of the rules contained in the deeds remains uncontradicted. See
Minard Run III, 670 F.3d at 254 n.12. As stated by Judge McLaughlin in Minard Run IV,
“the Third Circuit has already determined as a matter of law that the 1911 rules and
regulations contained in the ANF deeds do not provide the federal government with the
broad regulatory authority claimed by the . . . Defendants.” 894 F. Supp. 2d at 663.
4
  Appellants argue that the fact that the District Court selectively applied the law of the
case doctrine in Minard Run IV, sometimes addressing the merits of Appellants’ claims,
shows that the law of the case was not applicable at all. This argument is unconvincing;
the District Court did not need to address any of the new arguments presented by
Appellants, but in doing so merely emphasized its agreement with the conclusions
reached in Minard Run III.
                                                9
conclusion reached, they could have sought en banc review. This panel will not disturb

the well-reasoned legal conclusion reached by the prior panel.

                                            III.

       Because we find that Judge McLaughlin properly applied the law of the case to

this Court’s opinion in Minard Run III, we will affirm the District Court’s order.

                                            10