West Virginia Highlands Conservancy, Inc. v. Kempthorne

PUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

WEST VIRGINIA HIGHLANDS 

CONSERVANCY, INCORPORATED,

Plaintiff-Appellee,

v.  No. 07-2189

DIRK KEMPTHORNE, Secretary of the

Interior,

Defendant-Appellant.



Appeal from the United States District Court

for the Northern District of West Virginia, at Elkins.

Frederick P. Stamp, Jr., Senior District Judge.

(2:06-cv-00011-FPS)

Argued: March 25, 2009

Decided: June 10, 2009

Before MICHAEL, KING, and AGEE, Circuit Judges.

Affirmed by published opinion. Judge Michael wrote the

opinion, in which Judge King and Judge Agee joined.

COUNSEL

ARGUED: John Emad Arbab, UNITED STATES DEPART-

MENT OF JUSTICE, Environment & Natural Resources

Division, Washington, D.C., for Appellant. Walton Davis

2 WEST VIRGINIA v. KEMPTHORNE

Morris, Jr., MORRIS LAW OFFICE, PC, Charlottesville,

Virginia, for Appellee. ON BRIEF: Ronald J. Tenpas, Assis-

tant Attorney General, Aaron P. Avila, UNITED STATES

DEPARTMENT OF JUSTICE, Environment & Natural

Resources Division, Washington, D.C.; Wayne A. Babcock,

UNITED STATES DEPARTMENT OF THE INTERIOR,

Office of the Solicitor, Pittsburgh, Pennsylvania, for Appel-

lant. Mary Anne Maul, Charleston, West Virginia, for Appel-

lee.

OPINION

MICHAEL, Circuit Judge:

This appeal stems from the Interior Board of Land

Appeals’ (IBLA or Board) determination that the West Vir-

ginia Highlands Conservancy (WVHC) was not eligible for

attorneys’ fees after prosecuting an administrative appeal to

the IBLA. In the administrative appeal WVHC had chal-

lenged a decision of the Office of Surface Mining Reclama-

tion and Enforcement (OSM) that rejected a citizen complaint

filed by WVHC with the agency. The appeal resulted in an

IBLA remand order directing OSM to perform certain regula-

tory duties, including an investigation into whether it was

required to reassert regulatory jurisdiction over a particular

surface mining reclamation site pursuant to the Surface Min-

ing Control and Reclamation Act of 1977 (SMCRA), 30

U.S.C. § 1201 et seq. After the IBLA denied WVHC’s peti-

tion for attorneys’ fees in connection with the appeal, WVHC

sought review of the denial in district court. The district court

granted summary judgment to WVHC, holding that WVHC

was eligible for an award of fees under SMCRA’s fee-shifting

provision. We affirm.

I.

A person adversely affected by a surface mining operation

may file a citizen complaint with OSM when he believes a

WEST VIRGINIA v. KEMPTHORNE 3

SMCRA violation is occurring at the mining site. 30 U.S.C.

§ 1267(h)(1). If OSM has reason to believe there is a viola-

tion, the agency issues to the appropriate state regulatory

authority what is known as a "ten-day notice." Id.

§ 1271(a)(1); 30 C.F.R. § 842.11(b)(1)(ii)(B). If ten days pass

and the state fails "to take appropriate action to cause [the]

violation to be corrected or to show good cause for such fail-

ure," OSM conducts its own inspection. 30 U.S.C.

§ 1271(a)(1); 30 C.F.R. § 842.11(b)(1)(ii)(B)(1).

On May 13, 1994, WVHC filed a citizen complaint with

OSM alleging that a reclaimed LaRosa Fuel Company

(LaRosa) surface mining site, which had been authorized by

a West Virginia permit, was violating effluent standards for

acid mine drainage. Iron levels were too high and pH levels

too low, according to WVHC. OSM filed a ten-day notice

with the state regulatory authority, the West Virginia Depart-

ment of Environmental Protection (DEP). The DEP declined

to take any action to investigate or remedy the alleged

SMCRA violation. In a letter to OSM, the DEP explained that

it no longer had regulatory jurisdiction over the LaRosa site:

as of October 10, 1983, the state agency had terminated juris-

diction over the site when it released the performance bond

covering reclamation work, which had been completed. The

DEP further reported to OSM that the release of the bond was

"not based on fraud, collusion, or misrepresentation of a mate-

rial fact." W. Va. Highlands Conservancy, 165 I.B.L.A. 395,

397 (May 13, 2005) [hereinafter WVHC]; see also 30 C.F.R.

§ 700.11(d)(2). Accordingly, the DEP declined to reassert

jurisdiction over the LaRosa site or to otherwise take any

action with respect to the violations alleged in WVHC’s citi-

zen complaint.

OSM rejected the DEP’s explanation, concluding that the

state agency had failed to take appropriate action. According

to OSM: "The [S]tate’s decision to release LaRosa’s perfor-

mance bond does not affect the State’s responsibility to take

enforcement action against LaRosa for its continued failure to

4 WEST VIRGINIA v. KEMPTHORNE

meet applicable effluent limitations and water quality stan-

dards." WVHC, 165 I.B.L.A. at 398. OSM, relying on the

decision of an administrative law judge (ALJ) in an unrelated

LaRosa case, concluded that OSM’s regulatory jurisdiction

over a mining site did not terminate upon the state’s release

of a reclamation bond. See id. OSM therefore undertook its

own investigation of the allegations in WVHC’s citizen com-

plaint.

OSM inspected the LaRosa site on November 17, 1994.

SMCRA’s implementing regulations establish effluent limita-

tions for acid mine drainage, including maximum allowable

daily levels and average monthly levels for pH and iron. 30

C.F.R. § 715.17(a). OSM sampled pH and iron levels at four

locations at the LaRosa site. The samples showed pH levels

within the effluent limitations required by the regulations. But

one of the three iron samples showed 4.0 milligrams per liter

of iron, which is above the average monthly limitation of 3.5

milligrams per liter (even though it is within the maximum

daily limit of 7.0 milligrams per liter). 30 C.F.R. § 715.17(a);

WVHC, 165 I.B.L.A. at 399. OSM declined to take any fur-

ther action on the citizen complaint, however. WVHC, 165

I.B.L.A. at 399. In its decision issued May 15, 1995, OSM

explained that:

The requested actions raise significant issues with

respect to the agency’s implementation of the Clean

Water Act. . . . OSM is deferring action at this time

on these issues to allow an opportunity for policy

review and outreach. The outreach concerning

enforcement of the Clean Water Act requirements

had been initiated with the intent of reaching final

agency positions regarding these policies within [an]

180-day period . . . . Thus, it would be premature for

[the Field Office] to go forward in the manner that

you have requested until this process has been com-

pleted.

WEST VIRGINIA v. KEMPTHORNE 5

Id. at 399-400.

WVHC appealed OSM’s decision to the IBLA, arguing

principally that OSM had erred in failing to take additional

iron samples in order to calculate monthly average iron levels.

Id. at 400. In its opinion the IBLA indicated that it was

inclined to agree with WVHC that "the pendency of a request

for programmatic relief does not excuse OSM from acting

independently on inspection requests." Id. at 401. The Board,

however, concentrated on a different issue: the question of

whether OSM had jurisdiction over the LaRosa site. Id. After

OSM’s May 15, 1995, decision to take no further action on

WVHC’s citizen complaint, but before WVHC’s appeal of

that decision to the IBLA, the Board reversed the ALJ’s deter-

mination (in the unrelated LaRosa case) that OSM’s regula-

tory jurisdiction continued despite the full release of a

performance bond by a state regulatory authority. Id. at 402

(citing LaRosa Fuel Co., Inc. v. OSM, 134 I.B.L.A. 334

(1996)). In reversing the ALJ in LaRosa Fuel, the IBLA held

that "the State is granted exclusive jurisdiction upon approval

of a State regulatory program . . . to determine when reclama-

tion under the initial regulatory program has been completed."

Id. at 402. According to the IBLA, West Virginia’s written

finding in a bond release that a mining operation complied

with all state rules and regulations terminates both the state’s

jurisdiction and OSM’s oversight jurisdiction regardless of

whether OSM agrees with the finding. Id. The IBLA noted

one exception to this rule: OSM must exercise jurisdiction if

it finds "that the written determination was based on fraud,

collusion, or misrepresentation of a material fact." Id. at 405

(quoting LaRosa Fuel, 134 I.B.L.A. at 346); see also 30

C.F.R. § 700.11(d)(2).

The IBLA’s LaRosa Fuel decision prompted the Board to

raise, on its own initiative, the question of OSM’s jurisdiction

to entertain WVHC’s citizen complaint. The Board explained

that OSM would lack jurisdiction to take further action if rec-

lamation requirements at the LaRosa site had been success-

6 WEST VIRGINIA v. KEMPTHORNE

fully completed, the state had fully released the performance

bond, and there was no basis for OSM to reassert jurisdiction.

WVHC, 165 I.B.L.A. at 406. The Board concluded, however,

that the record before it was "not sufficient to establish that

jurisdiction [had] terminated." Id. Specifically, the Board

noted that OSM had not addressed the West Virginia DEP’s

failure to include, in its response to the ten-day notice, a copy

of any written determination by the agency that the LaRosa

operation had successfully completed the applicable reclama-

tion requirements for the site. Furthermore, OSM had failed

to ascertain whether the DEP had any evidence of pre-mining

water quality to support its claim that there was no significant

difference in pre- and post-mining water qualities. That evalu-

ation would be relevant, the Board said, in determining

whether the state agency’s formal termination of jurisdiction

was based on a "misrepresentation of a material fact," which

would require OSM to reassert jurisdiction. Id. at 405. The

IBLA therefore set aside OSM’s decision to take no further

action and remanded for the agency to fulfill its obligation "to

determine whether jurisdiction terminated under 30 [C.F.R. §]

700.11(d)(1)(i) and whether or not a basis for reasserting

jurisdiction has been established under 30 [C.F.R. §]

700.11(d)(2)." Id. at 406.

The IBLA’s remand decision prompted WVHC to file a

petition with the Board seeking its reasonable costs and

expenses, including attorneys’ fees, from OSM pursuant to

SMCRA. See 30 U.S.C. § 1275(e). Under the applicable regu-

lations, fees are available to a participant in a proceeding

under SMCRA "who prevails in whole or in part, achieving

at least some degree of success on the merits" (the eligibility

requirement), and who makes "a substantial contribution to a

full and fair determination of the issues" (the entitlement

requirement). 43 C.F.R. § 4.1294(b); see also W. Va. High-

lands Conservancy v. Norton, 343 F.3d 239, 245 (4th Cir.

2003) [hereinafter Norton] (discussing eligibility and entitle-

ment requirements).

WEST VIRGINIA v. KEMPTHORNE 7

In denying WVHC’s fee petition, the IBLA determined that

WVHC did not satisfy the threshold eligibility requirement

because the organization had not achieved at least some

degree of success on the merits. The IBLA reasoned that

WVHC could not claim "any measure of success at this point"

because the Board’s remand decision rejected an assumption

underlying WVHC’s administrative appeal, which was that

OSM had authority to inspect the LaRosa reclamation site.

J.A. 68.

WVHC filed an action in district court against the Secretary

of the Interior (the Secretary) seeking review of the IBLA’s

determination that WVHC was ineligible for costs and

expenses, including attorneys’ fees, in connection with the

underlying administrative appeal. The district court granted

summary judgment to WVHC, concluding that the IBLA’s

remand order represented "a partial success on the merits for

[WVHC]," rendering the organization eligible for fees. W. Va.

Highlands Conservancy v. Kempthorne, No. 2:06-cv-00011-

FPS, slip op. at 17 (N.D. W. Va. Sept. 20, 2007). WVHC

"partially prevailed," according to the district court, "because

the remand obtained through [WVHC’s] administrative

appeal has served a key purpose of the citizen suit provision,

which is to ensure that the agencies meet their regulatory obli-

gations under SMCRA." Id. (citing Norton, 343 F.3d at 246).

The district court’s order would remand the case to the IBLA

for consideration of the entitlement question. The Secretary

appeals.

II.

A district court order remanding a case to an administrative

agency "is usually not a final, appealable decision under 28

U.S.C. § 1291." Norton, 343 F.3d at 244 (internal quotation

marks omitted). "Nevertheless, ‘if a district court order

remanding a case to an administrative agency will be effec-

tively unreviewable after a resolution of the merits, the order

is a final decision.’" Id. (quoting Hanauer v. Reich, 82 F.3d

8 WEST VIRGINIA v. KEMPTHORNE

1304, 1306-07 (4th Cir. 1996)). Under SMCRA only those

persons aggrieved by agency actions may petition for judicial

review. 30 U.S.C. § 1276(a)(1). The agency itself cannot peti-

tion for judicial review. See Norton, 343 F.3d at 244. There-

fore, "if we do not review the district court’s summary

judgment order [in this case] prior to a remand to the Board,

the summary judgment order will become ‘effectively unre-

viewable’ as far as the Secretary is concerned." Id. at 244.

The summary judgment order therefore operates as a final,

appealable decision.

III.

We review de novo the question of whether a party is eligi-

ble for an award of attorneys’ fees under a fee-shifting statute.

Id. at 246. Most fee-shifting statutes allow fees only to the

prevailing party. See id. at 244 (citing Loggerhead Turtle v.

County Council, 307 F.3d 1318, 1322 n.4 (11th Cir. 2002)

(listing "prevailing party" statutes)). But some statutes allow

fees when the court or agency determines an award is appro-

priate. Id. at 244 (citing Loggerhead Turtle, 307 F.3d at 1322-

23 n.5 (listing "whenever appropriate" statutes)). Statutes that

permit fee-shifting "whenever appropriate" "expand the class

of parties eligible for fee awards from prevailing parties to

partially prevailing parties—parties achieving some success,

even if not major success." Ruckelshaus v. Sierra Club, 463

U.S. 680, 688 (1983). For a fee award to be "appropriate,"

there must be "some degree of success on the merits by the

claimant." Id. at 694.

SMCRA includes a "whenever appropriate" fee-shifting

provision; it authorizes an award of costs and expenses,

including attorneys’ fees, as "deem[ed] proper" by the Secre-

tary. See 30 U.S.C. § 1275(e); see also Norton, 343 F.3d at

244-45 (determining that SMCRA’s fee-shifting provision,

§ 1275(e), fits in the "whenever appropriate" category of stat-

utes governed by Ruckelshaus). SMCRA regulations autho-

WEST VIRGINIA v. KEMPTHORNE 9

rize costs and expenses, including attorneys’ fees, from OSM

to

any person, other than a permittee or his representa-

tive, who initiates or participates in any proceeding

under [SMCRA], and who prevails in whole or in

part, achieving at least some degree of success on

the merits, upon a finding that such person made a

substantial contribution to a full and fair determina-

tion of the issues.

43 C.F.R. § 4.1294(b) (emphasis added).

We interpret "prevailing in part"—or achieving some

degree of success on the merits—in light of the goals of

SMCRA’s citizen suit provision, "a key purpose of which" is

to ensure that OSM fulfills its statutory duties in a responsible

manner. See Nat’l Wildlife Fed’n v. Hanson, 859 F.2d 313,

316-17 (4th Cir. 1988). A party who obtains a remand order

requiring an administrative agency to properly perform its

regulatory duties has achieved some degree of success on the

merits, as our decisions in Hanson and Norton have estab-

lished.

In Hanson the plaintiffs brought a citizen suit under the

Clean Water Act (the CWA), alleging that the U.S. Army

Corps of Engineers (the Corps) failed to make an adequate

evaluation of whether a tract of land contained wetlands. Id.

at 315. The district court agreed with the plaintiffs and

directed the Corps on remand to make a properly informed

wetlands determination. Id. When the plaintiffs’ attorneys’

fees award was appealed to this court, we held that the plain-

tiffs were prevailing parties. Id. In achieving a remand that

ordered the Corps to undertake a proper investigation, the

plaintiffs had "served a key purpose of the citizen suit provi-

sion which is to ensure that the agencies" properly perform

their duties under the CWA. Id. at 317.

10 WEST VIRGINIA v. KEMPTHORNE

In Norton WVHC filed with OSM a citizen complaint

under SMCRA, seeking rescission of mining permits issued to

one coal company that allegedly owned or controlled a second

coal company that was mining in violation of SMCRA. 343

F.3d at 242-43. OSM determined that the first company did

not own or control the second, and WVHC appealed to the

IBLA. The Board ordered a remand, concluding that OSM

had failed to develop an adequate record on which OSM

could make a fully informed decision about the ownership

and control issue. Id. at 243. In affirming WVHC’s eligibility

for fees, we held that a "remand order that required OSM to

restart the informal review process . . . amounted to partial

success [because it] required OSM to do a proper job in carry-

ing out one of its duties under SMCRA." Id. at 247.

SMCRA assigns OSM certain duties with respect to coal

mine reclamation sites, such as the LaRosa site here, even

when the state regulatory authority has concluded that its

jurisdiction is terminated. See 30 U.S.C. §§ 1254(b), 1271.

These duties include the reassertion of OSM jurisdiction in

certain circumstances. Id. §§ 1254(b), 1271. If OSM has rea-

son to believe that a reclamation site is not in compliance with

SMCRA, OSM must "notify the State regulatory authority of

possible violations and allow the regulatory authority an

opportunity to respond." LaRosa Fuel Co., 134 I.B.L.A. at

347. If the state agency decides not to reassert jurisdiction, as

occurred here, then OSM must determine whether the state

agency properly terminated jurisdiction, see 30 C.F.R.

§ 700.11(d)(1)(i), and whether there is a basis for the state

agency to reassert jurisdiction, see id. § 700.11(d)(2). If there

is a basis for the reassertion of state regulatory jurisdiction

over the reclamation site, then OSM must reassert oversight

jurisdiction. See 30 C.F.R. § 700.11(d)(2); LaRosa Fuel, 134

I.B.L.A. at 350-51. OSM must also develop an adequate

record to support its jurisdictional determinations.

In remanding WVHC’s citizen complaint, the IBLA con-

cluded that the record developed by OSM was inadequate to

WEST VIRGINIA v. KEMPTHORNE 11

determine whether OSM had properly fulfilled its duties

under SMCRA. First, the Board noted that OSM had not

addressed the fact that the West Virginia DEP’s response to

OSM’s ten-day notice did not contain a written finding by the

state agency that reclamation at the LaRosa site had been suc-

cessfully completed. WVHC, 165 I.B.L.A. at 405-06; see 30

C.F.R. § 700.11(d) (requiring a written finding by the regula-

tory authority that all reclamation requirements have been

successfully completed). Second, the IBLA concluded that

OSM should explore whether the state agency had evidence

of pre-mining water quality to support its assertion that there

was no significant difference between pre- and post-mining

water qualities. This evidence would be relevant, the Board

said, in determining whether there had been a misrepresenta-

tion of material fact sufficient to trigger OSM’s duty to reas-

sert jurisdiction. WVHC, 165 I.B.L.A. at 406.

The IBLA’s remand order thus required OSM to properly

carry out the duty mandated by 30 C.F.R. § 700.11(d) to

determine whether it was required to reassert regulatory juris-

diction over the LaRosa reclamation site. That achievement

by WVHC amounts to some degree of success on the merits.

Our determination that WVHC achieved some degree of

success is unaffected by the fact that the IBLA’s remand order

was grounded on an issue that WVHC did not directly press

before the Board. "Whenever appropriate" attorneys’ fees

statutes "eliminate . . . the necessity for case-by-case scrutiny

by federal courts into whether plaintiffs prevailed ‘essentially’

on ‘central issues,’" or "essentially succeed[ed] in obtaining

the relief [they] seek[ ] in [their] claims on the merits." Ruck-

elshaus, 463 U.S. at 688. Thus, it is enough here that the

IBLA ordered OSM to carry out one of its regulatory duties.

For our cases, such as Hanson and Norton, make clear that

obtaining a remand that requires an agency to perform a regu-

latory duty represents the achievement of some success on the

merits. The district court’s summary judgment order holding

that WVHC meets the eligibility requirement for an award of

12 WEST VIRGINIA v. KEMPTHORNE

attorneys’ fees under SMCRA’s fee-shifting provision is

therefore

AFFIRMED.