Sierra Club v. United States Department of Agriculture

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued April 16, 2013 Decided May 28, 2013

No. 12-5095

SIERRA CLUB,

APPELLEE

v.

UNITED STATES DEPARTMENT OF AGRICULTURE,

RURAL UTILITIES SERVICE, ET AL.,

APPELLEES

SUNFLOWER ELECTRIC POWER CORPORATION,

APPELLANT

Appeal from the United States District Court

for the District of Columbia

(No. 1:07-cv-01860)

Sharon M. Mattox argued the cause for appellant Sunflower

Electric Power Corporation. With her on the briefs were

Thomas S. Meriwether, Carol Dinkins, and N. Beth Emery.

Amanda W. Goodin argued the cause for appellee Sierra

Club. With her on the brief were Kristen L. Boyles and Jan

Hasselman.

Brian C. Toth, Attorney, U.S. Department of Justice, argued

the cause for appellee U.S. Department of Agriculture. With him

2

on the brief was Andrew R. Varcoe, Attorney, U.S. Department

of Agriculture.

Before: GARLAND, Chief Judge, and ROGERS and GRIFFITH,

Circuit Judges.

Opinion for the Court by Circuit Judge ROGERS.

ROGERS, Circuit Judge: Intervenor Sunflower Electric

Power Corporation appeals the grant of summary judgment to

the Sierra Club based on violations of the National

Environmental Policy Act by the U.S. Department of

Agriculture’s Rural Utilities Service. The district court ruled

that the Service unlawfully failed to prepare an environmental

impact statement (“EIS”) before granting approvals and

financial assistance to Sunflower’s expansion of its coal-fired

power plant, and remanded the matter to the Service, enjoining

it from granting further approvals until it completed an EIS. We

dismiss the appeal for lack of jurisdiction. This court lacks

jurisdiction under 28 U.S.C. § 1291 because Sunflower appeals

a non-final remand order that is not immediately appealable by

a private party. This court lacks jurisdiction under§ 1292(a)(1)

because the injunction serves no purpose beyond the remand.

I.

The Rural Electrification Act, 7 U.S.C. §§ 902(a), 904,

authorizes the Secretary of Agriculture to make loans for

improving electric service in rural areas by financing the

construction and operation of power plants. Pursuant to the

Secretary’s delegation of authority, the Service — then known

as the Rural Electrification Administration — provided more

than $540 million in loans and loan guarantees to Sunflower

Electric Cooperative, Inc. (“Old Sunflower”) in 1980, for the

construction of a coal-fired power plant near Holcomb, Kansas.

3

Before granting the loan and loan guarantees, the Service

prepared an EIS for the coal-fired plant in accord with the

National Environmental Policy Act, 42 U.S.C. § 4332(2)(C),

which requires an EIS for any “major Federal actions

significantly affecting the quality of the human environment.”

A “major Federal action” is defined to include “projects and

programs entirely or partly financed, assisted, . . . or approved

by federal agencies.” 40 C.F.R. § 1508.18(a).

As of 2002, Old Sunflower still owed hundreds of millions

of dollars and had little prospect of making appreciable

payments. That year the Service consented to a debt settlement

and corporate restructuring pursuant to the Consolidated Farm

and Rural Development Act, 7 U.S.C. § 1981(b)(4), which

authorizes the adjustment, modification, or release of prior loan

agreements. As part of the restructuring, a newly organized

Sunflower Electric Power Corporation (“Sunflower”) acquired

most of Old Sunflower’s assets by issuing promissory notes to

its creditors, including the Service. The 2002 restructuring

enabled Sunflower to pursue developing additional power plants

at the Holcomb site, but required Sunflower to obtain written

approval from the Service before taking certain actions related

to the expansion.

Between 2005 and 2007, the Service approved a series of

agreements between Sunflower and others to develop three new

coal-fired power plants at the Holcomb site. In October 2007,

however, the State of Kansas denied an air quality permit for the

expansion project on the ground that new coal-fired plants

would harm human health and the environment by contributing

to global warming. In 2009 Sunflower negotiated a settlement

agreement with Kansas to allow an expansion project of a single

coal-fired plant. Sunflower has neither sought nor obtained the

Service’s approval of the 2009 settlement agreement.

4

Also in October 2007, the Sierra Club sued the Service and

Agriculture Department officials (together, “the Service”),

alleging that they violated the National Environmental Policy

Act by failing to prepare an EIS before approving the 2002

restructuring and subsequent agreements related to the

expansion project. Sunflower intervened by right as a defendant

pursuant to Federal Rule of Civil Procedure 24(a). The district

court granted summary judgment to the Sierra Club, concluding

that the Service’s decisions to provide necessary approvals and

financial assistance for the expansion project constituted “major

Federal actions” requiring an EIS under 42 U.S.C. § 4332(2)(C)

and 40 C.F.R. § 1508.18. Sierra Club v. Dep’t of Agric. (“Sierra

Club I”), 777 F. Supp. 2d 44, 57–64 (D.D.C. 2011).

At the Service’s request, the district court ordered additional

briefing on the appropriate remedy, id. at 68, and, upon review

thereof, granted declaratory and limited injunctive relief. Sierra

Club v. Dep’t of Agric. (“Sierra Club II”), 841 F. Supp. 2d 349,

352, 364 (D.D.C. 2012). The district court denied the Sierra

Club’s and the Service’s requests that Sunflower be ordered to

seek Service approval of the 2009 settlement agreement, as

neither that agreement nor the continuing validity of the earlier

2007 approvals were before the district court, id. at 357. It also

denied the Sierra Club’s request that Sunflower be enjoined

from commencing construction or entering other arrangements

for the expansion project, id. at 360–62. Instead, the district

court enjoined the Service from issuing any further “approvals

or consents for agreements or arrangements directly related to,”

or taking “any other major federal actions in connection with,”

the expansion project without first completing an EIS. Id. at

360. With the injunction, and the Service’s “emphatic

conclusion that Sunflower must seek additional approvals” from

it before the expansion project could proceed, id. at 362, the

district court concluded that there was no need to vacate the

2002 restructuring or 2007 approvals. Id. at 362–63. The

5

district court remanded the matter to the Service “to determine

what further action, if any, is necessary.” Id. at 364.

The Service and Sunflower timely appealed, but the Service

abandoned its appeal and moved to dismiss Sunflower’s appeal

for lack of jurisdiction.

II.

“Because this court may not proceed without appellate

jurisdiction, we must address the motion to dismiss before

considering the arguments on the merits.” Pueblo of Sandia v.

Babbitt, 231 F.3d 878, 880 (D.C. Cir. 2000) (citing Steel Co. v.

Citizens for a Better Env’t, 523 U.S. 83, 94 (1998)).

A.

“The jurisdiction of a Court of Appeals under 28 U.S.C.

§ 1291 extends only to ‘appeals from . . . final decisions of the

district courts.’” Ortiz v. Jordan, 131 S. Ct. 884, 891 (2011)

(quoting 28 U.S.C. § 1291). “It is black letter law that a district

court’s remand order is not normally ‘final’ for purposes of

appeal under 28 U.S.C. § 1291.” N.C. Fisheries Ass’n v.

Gutierrez, 550 F.3d 16, 19 (D.C. Cir. 2008); Pueblo of Sandia,

231 F.3d at 880. This rule promotes judicial economy and

efficiency by avoiding the inconvenience and cost of two

appeals: one from the remand order and one from a later district

court decision reviewing the proceedings on remand. Pueblo of

Sandia, 231 F.3d at 880 (citing In re St. Charles Preservation

Investors, Ltd., 916 F.2d 727, 729 (D.C. Cir. 1990)). It also

leaves open the possibility that an appeal may prove

unnecessary if the remanded proceedings satisfy all parties. Id.

“[T]here is a limited exception permitting a government

agency to appeal immediately [from a remand order under

§ 1291], but that path is not normally available to a private

6

party.” N.C. Fisheries Ass’n, 550 F.3d at 19–20 (internal

citations omitted); N. Air Cargo v. USPS, 674 F.3d 852, 857

(D.C. Cir. 2012); Am. Hawaii Cruises v. Skinner, 893 F.2d 1400,

1402 n.* (D.C. Cir. 1990). The reason for this asymmetry is that

a government agency cannot later challenge its own actions

complying with a remand order, whereas a private party

dissatisfied with the action on remand may still challenge the

remanded proceedings — as well as the remand order requiring

them — after the proceedings are complete. See Lakes Pilots

Ass’n, Inc. v. U.S. Coast Guard, 359 F.3d 624, 625 (D.C. Cir.

2004); NAACP v. U.S. Sugar Corp., 84 F.3d 1432, 1436 (D.C.

Cir. 1996); Occidental Petroleum Corp. v. SEC, 873 F.2d 325,

330–32 (D.C. Cir. 1989).

The collateral order doctrine, invoked by Sunflower, is a

“practical construction” of § 1291, Digital Equip. Corp. v.

Desktop Direct, Inc., 511 U.S. 863, 867 (1994), that allows

appeal of a “small category” of rulings “that are conclusive, that

resolve important questions separate from the merits, and that

are effectively unreviewable on appeal from the final judgment

in the underlying action,” Mohawk Indus., Inc. v. Carpenter, 558

U.S. 100, 106 (2009) (quoting Swint v. Chambers Cnty.

Comm’n, 514 U.S. 35, 42 (1995)). Sunflower maintains that its

appeal fits within the doctrine because the district court

conclusively ruled that certain Service actions qualified as major

federal actions requiring an EIS, and its interests “‘will be

irretrievably lost in the absence of an immediate appeal,’”

Appellant’s Br. at 18–19 (quoting Occidental, 873 F.2d at 329).

The Supreme Court, however, has repeatedly emphasized the

narrow and modest scope of the collateral order doctrine, see

Will v. Hallock, 546 U.S. 345, 350 (2006), which “must ‘never

be allowed to swallow the general rule that a party is entitled to

a single appeal, to be deferred until final judgment has been

entered,’” Mohawk, 558 U.S. at 106 (quoting Digital Equip.

Corp., 511 U.S. at 868). This court, in turn, has consistently

7

declined invitations to apply the doctrine to private-party

appeals from remand orders. See N.C. Fisheries Ass’n, 550 F.3d

at 20 n.5; Lakes Pilots Ass’n, 359 F.3d at 625; Am. Hawaii

Cruises, 893 F.2d at 1403. We decline Sunflower’s invitation

to extend the collateral order doctrine here.

Sunflower fails to cite a single case in its favor and neither

establishes that the district court resolved important questions

separate from the merits, nor demonstrates that the district

court’s decision will be unreviewable in a future appeal. For

example, if the Service imposes environmental conditions on the

expansion project and ultimately withholds additional approvals

on environmental grounds, Sunflower can appeal and renew its

argument that the Service lacks such authority. Or if the Service

grants additional approvals and the Sierra Club or another

plaintiff challenges the EIS as inadequate, then Sunflower can

intervene as of right and, if the plaintiff prevails, argue on

appeal that the adequacy of the EIS is irrelevant because the

Service’s minor approvals over the years did not constitute, by

accumulation, “major Federal actions” under 42 U.S.C.

§ 4332(2)(C). The remanded proceedings may, “as a practical

matter,” prevent Sunflower from raising some of its objections

to the district court’s decision in a subsequent appeal, but “the

mere identification of some interest that would be ‘irretrievably

lost’ has never sufficed” to invoke the collateral order doctrine,

Digital Equip. Corp., 511 U.S. at 872, and Sunflower’s

contention is not “an appealing prospect for adding to it,” id. at

871. To the extent Sunflower objects that, even if it ultimately

receives the approvals it seeks, it will have been injured by the

“cost and delay” resulting from the Service’s preparation of an

EIS, Reply Br. 3, the Supreme Court has instructed that “the

strong bias of § 1291 against piecemeal appeals almost never

operates without some cost.” Id. at 872. And this court has

recognized that although § 1291 inevitably results in some

delay, “Congress has determined that such delay must be

8

tolerated.” Salazar ex rel. Salazar v. District of Columbia, 671

F.3d 1258, 1261 (D.C. Cir. 2012).

Both the Ninth and Eighth Circuits have held that a district

court order remanding for preparation of an EIS does not

constitute a “final decision” appealable by a private party under

the collateral order doctrine or 28 U.S.C. § 1291 more generally.

See Pit River Tribe v. USFS, 615 F.3d 1069, 1074–77 (9th Cir.

2010); Izaak Walton League of America v. Kimbell, 558 F.3d

751, 762–63 (8th Cir. 2009). The reasoning of those cases

applies here. As in Pit River Tribe, 615 F.3d at 1076, Sunflower

“will have an opportunity to participate in the [Service’s

environmental review] processes on remand,” and if the Service

grants Sunflower the approvals it seeks, then “any decision by

this court may prove entirely unnecessary.” Although, as

Sunflower notes, the Ninth Circuit allowed a private-party

appeal in Sierra Forest Legacy v. Sherman, 646 F.3d 1161 (9th

Cir. 2011), the circumstances of that case do not apply here. In

Sierra Forest Legacy, a remand was ordered to cure a deficiency

in an EIS, the agency prepared a draft supplemental statement

before the appeal was heard, and the appellant maintained that

neither the district court order nor the draft supplemental EIS

addressed the alleged violations, id. at 1174–75. On these

unique facts, the Ninth Circuit distinguished Pit River Tribe and

concluded that the remand order was effectively final under

§ 1291 because “the work of both the district court and the

agency is complete.” Id. at 1176. The same is not true here.

As an alternative basis for jurisdiction under § 1291,

Sunflower contends that the remand order is final because it

leaves “nothing for [the Service] to do.” Appellant’s Br. 16.

“[S]everal courts, including this one, have noted that remand

orders may be considered final where a court remands for solely

‘ministerial’ proceedings.” Pueblo of Sandia, 231 F.3d at 881.

Sunflower relies on Skagit County Public Hospital Dist. No. 2

9

v. Shalala, 80 F.3d 379, 384 (9th Cir. 1996), and Ringsby Truck

Lines, Inc. v. United States, 490 F.2d 620, 624 (10th Cir. 1974).

In those cases, however, further agency action on remand was

effectively precluded, whereas here the Service may prepare an

EIS and consider additional approvals related to the expansion

project. If Sunflower attempts to commence construction on the

expansion project without obtaining additional Service approval,

then the Service may seek to enjoin construction based on

breach of contract, see Sierra Club II, 841 F. Supp. 2d at 357.

Each of these actions would entail significant discretion on the

part of the Service. Thus, as in Pueblo of Sandia, 231 F.3d at

881, “the district court’s remand order contemplates more than

[a] ministerial act.”

In sum, Sunflower’s contentions “do[] not hold up under the

broad scrutiny to which all claims of immediate appealability

under § 1291 must be subjected,” Digital Equip. Corp., 511 U.S.

at 871, and, for the following reasons, its invocation of

§ 1292(a)(1) also fails under our precedent.

B.

One statutory exception to the “final decision” requirement

is § 1292(a)(1), which permits appeal from “[i]nterlocutory

orders of the district courts . . . granting, continuing, modifying,

refusing or dissolving injunctions.” “Because § 1292(a)(1) was

intended to carve out only a limited exception” to the general

policy against piecemeal review, the Supreme Court has

“construed the statute narrowly,” Carson v. Am. Brands, Inc.,

450 U.S. 79, 84 (1981), and approached it “somewhat gingerly

lest a floodgate be opened,” Switzerland Cheese Ass’n, Inc. v. E.

Horne’s Mkt., Inc., 385 U.S. 23, 24 (1966). This court, while

acknowledging that articulating the scope of § 1292(a)(1) is

“resistant to brief summary,” has explained that if a district court

order “clearly grant[s] or den[ies] a specific request for

injunctive relief . . . it falls within the plain text of § 1292(a)(1)

10

and is appealable without any further showing.” Salazar, 671

F.3d at 1261 (internal quotation marks omitted). And even if

the terms of the order do not grant or deny a specific request for

an injunction, the order may still be appealable if it has the

“practical effect” of doing so. Id. (quoting Carson, 450 U.S. at

83). At the same time, our precedent instructs that, for purposes

of determining whether a district court order is immediately

appealable, entry of a specific remedy does not always change

the overall character of the order as a remand. See Cnty. of Los

Angeles v. Shalala, 192 F.3d 1005, 1011–12 (D.C. Cir. 1999).

In such instances, this court will “construe [the district court’s

order] as a remand . . . and ignore, for jurisdictional purposes, its

later order on specific relief.” Id. at 1012; see also N. Air

Cargo, 674 F.3d at 857.

The district court granted some of the injunctive relief

requested by the Sierra Club and the Service. See Sierra Club

II, 841 F. Supp. 2d at 357–60. It enjoined the Service from

issuing “any approvals or consents for agreements or

arrangements directly related to the Holcomb Expansion Project,

or [taking] any other major federal actions in connection with

the Holcomb Expansion Project, until an EIS is complete.” Id.

at 360, 363–64. Sunflower consequently maintains that the

district court decision is appealable as an interlocutory order

under § 1292(a)(1). Nonetheless, the Service contends that the

limited injunction, which is directed against the Service rather

than Sunflower, does not provide a basis to review Sunflower’s

appeal under § 1292(a)(1). Relying on County of Los Angeles,

the Service maintains that “[a]n injunction like the one here that

does nothing more than provide more detail to the parameters of

a remand order is, in substance, treated as a remand for purposes

of Section 1291 and thus is not immediately appealable by a

private intervenor.” Gov’t Resp. Br. 11.

11

The district court declined to vacate the Service’s prior

approvals or to enter an injunction against Sunflower. See

Sierra Club II, 841 F. Supp. 2d at 361–63. Instead, it granted

declaratory relief, entered a limited injunction against the

Service, and remanded the matter to the Service for further

proceedings. See id. at 363–64. Notably, the Service had

requested the injunctive relief in its supplemental briefing in the

district court. See id. at 359–60 & n.8. At the time, the Service

was still contesting the district court’s grant of summary

judgment to the Sierra Club for failure to prepare an EIS and

planned to appeal, but wanted to ensure that the expansion

project did not commence until any necessary EIS had been

completed. On appeal, the Service has acquiesced in the merits.

At oral argument, its counsel agreed that, pursuant to the

judgment of the district court, the Service must prepare an EIS

if Sunflower seeks additional approvals for the expansion

project, and committed that the Service would do so on remand

even absent the injunction. Oral Arg. Recording at 32:50-33:33.

(Neither the Sierra Club nor Sunflower suggest that those

representations were made in bad faith.) Consequently, the

Service maintains that the injunction serves no additional

purpose beyond the remand order.

In a similar case, the Eighth Circuit held that it lacked

jurisdiction under § 1292(a)(1) where a defendant-intervenor,

rather than the defendant agency, sought to appeal a district

court order enjoining the agency from taking further action until

it prepared an EIS. See Izaak Walton League, 558 F.3d at 763.

Here, as in that case, “[e]ven if the district court had not granted

[injunctive] relief, or if this court now vacated the injunction,”

the Service could still withhold further approvals for

Sunflower’s expansion project until completion of an EIS. Id.

Allowing Sunflower’s private-party appeal from the remand

order, based on a limited injunction entered against the Service,

would be to permit an end run around the § 1291 finality

12

requirement and the “general congressional policy against

piecemeal review.” Carson, 450 U.S. at 84.

Accordingly, because the injunction against the Service

serves no function beyond the remand order, and pursuant to

County of Los Angeles this court must ignore the injunction for

jurisdictional purposes, we dismiss Sunflower’s appeal for lack

of jurisdiction. We thus can express no position on the merits of

the injunction or Sunflower’s contention that the Sierra Club’s

case was moot when filed. “If we lack jurisdiction, we cannot

vacate the district court’s order for lack of jurisdiction because

we lack the power to do so.” Defenders of Wildlife v.

Perciasepe, ___ F.3d ___, 2013 WL 1729598, at *8 (D.C. Cir.

April 23, 2013).