Petition for Writ of Certiorari — Action League League v. Department of Transportation (No. 06-988)

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No. OFFICE OF THE CLENK

IN THE

Supreme Court of the United States

HIGHWAY J CITIZENS GROUP, U.A., et al..

Petitioners,

Vv.

UNITED STATES DEPARTMENT OF

TRANSPORTATION, et al.,

Respondents.

On Petition for Writ of Certiorari

to the United States Court of Appeals

for the Seventh Circuit

PETITION FOR WRIT OF CERTIORARI

Charles H. Barr Jeremy P. Shapiro-Barr

Counsel of Record Chernov, Stern & Krings, S.C.

Croen & Barr LLP Two Plaza East, Suite 1275

250 East Wisconsin Ave. 330 East Kilbourn Ave.

Milwaukee, WI 53202 Milwaukee, WI 53202

414-226-2080 414-276-4080

Counsel for Petitioners

QUESTIONS PRESENTED

A lawsuit under the National Environmental Policy

Act (NEPA), alleging that a government project would

cause specific environmental harm, included a claim

that certain government agencies had unlawfully seg-

mented that project from an adjacent one to avoid

preparation of an environmental impact statement on

the effects of the first project. The lower courts rejected

the segmentation claim and held that the two projects

were properly separate. In a later suit, the same plain-

tiff challenged the adjacent project under NEPA, alleg-

ing environmental harm of an entirely different nature

and in a different location.

The questions presented are:

I. Where a NEPA action challenges one government

project and alludes to another project only via an un-

successful claim that certain government agencies

unlawfully segmented the two, does claim preclusion

bar a subsequent NEPA action challenging the second

project?

Il. Does claim preclusion bar a NEPA claim seeking

preparation of a Supplemental environmental impact

statement based on facts that did not exist until after

disposition of the claimant’s previous NEPA lawsuit

concerning that project?

III. Should a federal court of appeals assign the

same three-judge panel to appeals in separate, succes-

sive lawsuits, where the sole issue in the second appeal

is whether disposition of the first lawsuit barred the

claims made in the second one? ;

PARTIES TO THE PROCEEDING

Petitioner Highway J Citizens Group (“Citizens”) is

an unincorporated association of over 15,000 members,

consisting principally of homeowners, family. farmers,

and small business owners, in the State of Wisconsin.

Citizens was an appellant in the U.S. Court of Appeals

for the Seventh Circuit and a plaintiff in the U.S. Dis-

trict Court for the Eastern District of Wisconsin.

Petitioner Waukesha County Environmental Action

League (“WEAL”) is a Wisconsin non-stock corporation

of approximately 100 members. WEAL has no parent

corporation, no stock, and no publicly held company

owns any portion of it. WEAL was an appellant in the

U.S. Court of Appeals for the Seventh Circuit and a

plaintiff in the U.S. District Court for the Eastern Dis-

trict of Wisconsin.

The respondents are the United States Department

of Transportation (“USDOT”); Maria Cino, in her offi-

cial capacity as Secretary of USDOT; the Federal

Highway Administration (“FHWA”); Mary Peters, in

her official capacity as Administrator of FHWA; the

United States Army Corp of Engineers (“COE”); Mi-

chael F. Pfenning, in his official capacity as District

Engineer of the COE; and Frank Busalacchi, in his offi-

cial capacity as Secretary of the State of Wisconsin De-

partment of Transportation (““WisDOT”). All respon-

dents were appellees in the U.S. Court of Appeals for

the Seventh Circuit and defendants in the U.S. District

Court for the Eastern District of Wisconsin.

ill

TABLE OF CONTENTS

QUESTIONS PRESENTED. .......cccccccorssocorcovscoososoesenseses

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REASONS FOR GRANTING THE PETITION

I. The Court Should Grant this Petition to

Address Conflict Among the Circuit

Courts Regarding the Test for

Determination of the “Identical Claims’

Prong of Claim Preclusion Analysis. .................... 5

A. The circuit courts have applied

several different standards to

determine whether claims are

identical under the claim preclusion

LE I EE TES

B. Choice of the proper test for

identity of claims is determinative

of the claim preclusion issue in the

CONG Es ccnicntcinicidibaiiasadiaieebentaseninaes 10

Il. The Court Should Grant this Petition

to Address a Conflict Among the Circuit

Courts Regarding the Effect on Claim

Preclusion Analysis of Facts that Did Not

Exist During the Pendency, ov in Any

Event at the Inception, of the Previous

PE II> ciscbbcicabspteicitaidiadcitcieainhciistaassdempinsciariabiesapinleacdalteieaiuisaniiin’ 19

III. The Court Should Grant this Petition

in the Exercise of Its Supervisory Power

to Consider the Circumstances in

which a Court of Appeals May Depart

from Random Assignment of Panel

ITI: sapassvndeptavndenasainbiedanmisiaiibiuuaicianeneibanbeoniaens 25

a IT di sicdinscnaicbelinlenithiscnctininsdiiokdiabsentiediunodiniodn 30

SEES Stcdactmsicsisenisctipadecnibasncinnndvadaieinbainnismbbacs ini 31

TABLE OF AUTHORITIES

Cases

Allen v. McCurry, 449 U.S. 90 (1980) .......cceceeeessceceeseeteees 5

American Cyanamid Co. v. Capuano,

SE Fe Gs NO Aeidcsteisiiticindtdterioien 21

Andersen v. Chrysler Corp.,

ee Briers isa kcshainisdniteicovactcternions 6,9,12

Blair v. City of Greenville,

I ee es FI i ccsiesisrarccestcersnnccnentsececsesacenness 21

Blair v. Equitax Check Services, Inc.,

Se Fe rs FE eictn cee indnntidicetnossientoissintace, 26

Brokaw v. Weaver, 305 F.3d 660 (7*» Cir. 2002) .............. 26

Brown v. Vance, 637 F.2d 272 (5 Cir. 1981) .........::e00e 25

Brzostowski v. Laidlaw Waste Systems, Inc.,

Fe Br , Si ikicreniteteciitia cea pdaigtetntined 11

Central Delta Water Agency v. United States,

306 F.3d 938, 963 (8 Cir. 2002) ...ccceccccccccsscccscsnsesccceneseces 10

Colonial Penn Life Ins. Co. v. Hallmark Ins.

Admin., Inc., 31 F.3d 445 (7th Cir. 1994) .........cceecceeeeeeeees 11

Costantini v. Trans World Airlines,

GOl F.Sd 11GB OG Cie. TOBE) neccciciseiecensnsscrncscescsececassoncsceses 10

Dore v. Kleppe, 522 F.2d 1369 (5t* Cir. 1975).............00005 19

Drake v. F.A.A., 291 F.3d 59 (D.C. Cir. 2002)...........0000002. 24

Grutter v. Bollinger, 288 F.3d 732 (6 Cir. 2002),

I 28

Havercombe v. Dept. of Educ. of Com. of P.R.,

Se a, aio ncesscsnscksksearesecassseundausenaneaconcss 24

Headwaters, Inc. v. U.S. Forest Service,

BD Fe BGT CI Cole, BI acces cainctsovetinnrancevesvcceseconnonsens 6

Hells Canyon Preservation Coun. v. U.S. Forest

Service, 403 F.3d 683 (9t Cir. 2005) ..........ccccseceseeeeeeees 6,10

Hermann v. Cencom Assocs., Inc.,

999 F.2d 223 (7*» Cir. 1993)...............cccccccceeeeeeeese 6,7,8,11,12

Highway J Citizens Group v. Mineta

(“Citizens I”), 349 F.3d 938 (7* Cir. 2003),

cert. denied, 541 U.S. 974 (2004)......0...... eee 3,14,15,17,18

Highway J Citizens Group v. U.S. Dept. of

Transp. (“Citizens IJ”),

456 F.3d 734 (7% Cir. a nme SS

In re Atlanta Retail, Inc,

ge Bh eg hte ke ee) ene eee 16

Lawler v. National Screen Serv. Corp.,

ee EGBG aR certs PPO EPC eRERD OPIS OLE 21

Lubrizol Corp. v. Exxon Corp.,

Be ae Pe Ne. ROE sovvaicisinsnesnoxeeevvratncivaeenseriseenetioneus 8

Manning v. City of Auburn,

OE FE RIGS TI Cie, BOGE noice ence cenevensscsescteronsneserts 24

Marsh v. Oregon Natural Resources Coun.,

Ee IRR IRRN aee ra Oa etn Or de eA Pr los 22

Matter of Energy Co-op., Inc.,

814 F.2d 1226 (7 Cir. 1987) ...cscsssccssssssessssssssesssseeeeceeeeeeee 9

McDermott, Inc. v. Wheelabrator-Frye, Inc.,

Se Be vain eticteccisecdticcsees 26

Montana v. United States, 440 U.S. 147 (1979) ..........0.... 10

Nevada v. United States, 463 U.S. 110 (1983)................. 7,9

Ripplin Shoals Land Co., LLC v. U.S. Army

Corps of Engineers, 440 F.3d 1038 (8 Cir. 2006) ........... 21

Sanders Confectionery Prods. v. Heller Fin., Inc.,

FB Cr I vein sss acickeadicevistsctkcccctecicmiones 9

S.E.C. v. First Jersey Securities, Inc., 101 F.3d 1450 (2d

Cir. 1996), cert. denied, 522 U.S. 812 (1997) wc. 23

Stone v. Dept. of Aviation,

AGE P.Bk SST E CIO Civ, BOO ocncicssesicecensenccsvnivvereccescenervesees 24

Sure-Snap Corp. v. State St. Bank and Trust Co.,

a Ge Oe NOR i cissniechcaadeecssdccertontenitndcccicedinn 9

The New River Valley Greens v. U.S. D.O.T.,

161 F.3d 3, 1998 WL 633959 (4 Cir. 1998) .........00000..0002. 21

United States v. Athlone Indus., Inc.,

ee eT eB siacvnesecctivias sees ecconisie date caabancerenatanns 6

Statutes and Regulations

United States Code:

Be Rate WOE cadisvisesdbacicidescendasninttaltavmnstunmaobeaibieumeiainnne 4

PATTI. BBD oeehternteen otters asulcnasiiaieadiad 1

Vili

WUD 6. i cccickn cage ee 4

DEB CUI recessive anes 4

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SOUSE 6 is icceccdcic 25

LER Le | SR RaaER IN eT 25

Fed.R.Civ.P. 15(c), 28 U.S.C. ccsssssecsccssscssssssssvecssssesssee 24

MU BE SF GOIB ovosiescrccsiencde ee eee 1

Code of Federal Regulations:

Lek oS ey ¥ i. SOeNereCeNm Tenn TP IP Re TN. 2,3,18

MO CP E..6 TOG ic becsicssciccctetevcscciaeaaae 1,17

40 C.F.R. § SOI vsiisissscictasidsuishccdai ames 2

MO CPR. © 1G OD ice ceccctitersecosuicatnce svtecncteas 20

40 C.F RS LUCE BIRD wiccsiiccssssecictessineereion 1,17

Circuit Rule 36(c), U.S. Court of Appeals

Ser Cie FOIE CO inc ceiisessiesesciacciosssanccusccincdeee 22

Seventh Circuit Internal Operating Procedures:

PRIIIOD onsivessiecdiaatccdivecsinkasatioininddn aaa 26

Giktdccadhtreicbesridsriitgelistina uate ee

OD i sscectcccdeiiausictateuietecanae dat nes gee 2,25,26,28,29

ED iredickicenssctocorioedecsiniaai eee ee 25

Other Authorities

J. Robert Brown, Jr. and Allison Herren Lee,

Neutral Assignment of Judges at the Court

of Appeals, 78 TEX.L.REV. 1037 (2000) ........00.......00. 26,27

Jonathan R. Macey, Judicial Preferences, Public Choice,

and the Rules of Procedure,

20 0, GAL STUD, G27 (1GD4) ..............0ccccccceccsccvcscceroeses 27

Daniel R. Mandelker, NEPA Law and Litigation

(2d ed. 2006)

18 Moore’s Federal Practice 3d (2006):

| 0D a ane 6

on cavevmsersinenrwsnvvvaveteeess 6

a . sunbuveavesedsesseevers 7,8,11

a sccsevsesevccevecewetounosens 8,9,10

Ne cccaueccucesnereeucevecsnes 21

Practitioner’s Handbook for Appeals to the United States

Court of Appeals for the Seventh Circuit (2003) ........ 27,28

Restatement of Judgments § 61 (1942) .............cccccceseeseeeeees 9

Restatement (Second) of Judgments (1982):

Nee cacacocetevseveencevasieesveresens 7

ns sswucenendounnsuctecesenevess 7,9

Petitioners respectfully request that this Court issue

a writ of certiorari to the United States Court of Ap-

peals for the Seventh Circuit, and in support of their

petition state as follows:

OPINIONS BELOW

The court of appeals opinion (App. 1-22) is reported

at 456 F.3d 734, 36 Envtl. L. Rep. 20,152 (7*» Cir. 2006).

That court’s order denying the petition for rehearing

(App. 177) is unreported.

The opinion of the United States District Court for

the Eastern District of Wisconsin denying the petition-

ers’ motion for a preliminary injunction (App. 23-61) is-

sued April 27, 2005 and is reported at 2005 WL

1076071. The opinion of that district court denying the

petitioners’ motion for an injunction pending appeal is-

sued June 16, 2005 and is reported at 2005 WL

1421489.

JURISDICTION

The judgment of the court of appeals (App. 1-22), of

which the petitioners seek review, was entered on Au-

gust 2, 2006. The petitioners filed a timely petition for

rehearing, and an order denying that petition was en-

tered October 12, 2006. Petitioners invoke the jurisdic-

tion of this Court under 28 U.S.C. § 1254(1).

STATUTES AND REGULATIONS INVOLVED

The relevant section of NEPA, 42 U.S.C. § 4332, is

reproduced at App. 178-81. Council on Environmental

Quality (CEQ) regulations concerning segmentation, 40

C.F.R. §§ 1502.4(a) and 1508.25(a)(1), are reproduced at

App. 181-82. An FWHA regulation concerning segmen-

tation, 23 C.F.R. § 771.111, is reproduced at App.

182-83. A CEQ regulation on preparation of a supple-

mental environmental impact statement (SEIS), 40

C.F.R. § 1502.9(c), is reproduced at App. 183-84. A Sev-

enth Circuit Internal Operating Procedure on panel as-

signment, IOP 6(b), is reproduced at App. 184-85.

STATEMENT OF THE CASE

This.case requires discussion of two construction

projects on State Highway 164 in Wisconsin: the “Ack-

erville Bridge Project” and the “Highway 164 Project.”

App. 3-7. The “Ackerville Bridge Project” primarily in-

volves the construction of two overpass structures on

approximately 1.3 miles of the highway in Washington

County. App. 5-6, 65-66, 188-89. The “Highway 164 Pro-

ject” involves the expansion of an 18-mile segment of

the highway, principally in Waukesha County but also

in Washington County, from two lanes to four. App. 4-

5, 85-86, 204.! The projects cover adjacent or nearly ad-

jacent, but not overlapping, segments of the highway.

App. 5-6, 86, 189.2 They were assigned separate gov-

ernment project numbers, and the environmental

evaluations for each were separate and proceeded on

different time lines. App. 4-7, 64-85, 218-19, 229.

1 When initially constructed, the highway was named

County Highway J. It was renamed State Highway 164 under

jurisdictional transfer agreements between WisDOT and local

governments. App. 4n.4; App. 189.

2 The northern terminus of the Highway 164 project has

been variously described so as either to abut the southern ter-

minus of the Ackerville Bridge Project, or to leave a small gap

between those two points. App. 190.

Citizens sued various federal and state agencies and

officers in federal district court in July 2002,? claiming

that construction of the Ackerville Bridge Project risked

disturbing an underground “contamination plume” con-

taining arsenic and trichloroethylene, which was mi-

grating towards the site. App. 63, 190-92. Citizens’

complaint consisted of three counts. First, it alleged

that the environmental assessment for the project failed

to examine the risks associated with the contamination

plume, and sought to enjoin continued construction of

the overpasses and to require filling of the drilled

bridge piling holes with concrete pending another envi-

ronmental impact study, which it requested the court to

order. App. 7-8, 193-96. Second, Citizens contended that

the agencies had failed to consider reasonable alterna-

tives to building the Ackerville bridges. App. 8, 196-98.

Lastly, Citizens included a claim that the agencies had

improperly segmented the Ackerville Bridge Project

from the Highway 164 Project to avoid preparation of

an EIS concerning the Ackerville Bridge Project. App. 8,

106-07, 198.

The district court ruled against Citizens on the mer-

its (App. 111-76), and the court of appeals, per the same

panel later assigned to the case at bar, affirmed. High-

way J Citizens Group v. Mineta (“Citizens I”), 349 F.3d

938 (7 Cir. 2003), cert. denied, 541 U.S. 974 (2004)

(App. 62-110). In addressing Citizens’ segmentation

claim, the court of appeals held that the agencies had

appropriately analyzed the relevant factors under 23

C.F.R. § 771.111(f) (App. 182-83), the FHWA regulation

concerning project definition. Jd. at 963 (App. 108-09).

3 The court of appeals’ decision in Citizens // at one point erro-

neously states that this filing occurred in July 2003. App. 7.

The court noted that the most important of those fac-

tors in the case before it was that the separate projects

have independent utility. /d. (App. 109). The agencies

had determined—properly according to the court—that

independent utility existed because the focus of the

Ackerville Bridge Project was transportation safety,

while the focus of the Highwa, -164 Project was high-

way expansion, and neither required construction of

any other projects to be usable. Jd. (App. 109).

In February 2005, Citizens and WEAL (collectively,

“Citizens”) filed the current action invoking the district

court’s jurisdiction under 5 U.S.C. § 702, and 28 U.S.C.

§§ 1331, 1361, and 1367. App. 212. In that action, Citi-

zens claimed that the Highway 164 Project would ad-

versely affect public health by increasing motor vehicle

use, traffic congestion, and emission of air pollutants;

would increase conversion of open lands to developed

uses; and would destroy wetlands and thereby increase

flooding and adversely affect the aquatic ecosystem.

App. 221-28. Citizens also claimed that the agencies

failed to hold adequate public hearings on the proposed

EIS for the Highway 164 Project. App. 216, 237. Fi-

nally, Citizens asserted that new information concern:

ing the project’s adverse effects on wetlands, air quality,

noise, land use, and highway safety became available

after final approval of the EIS, which required prepara-

tion of an SEIS. App. 76-77, 234-35.

The district court denied Citizens’ motion for a pre-

liminary injunction to stop work on the project. App. 23-

61. That court ruled that Citizens had not demon-

strated a reasonable likelihood of success on the merits

because their claims probably were barred by claim pre-

clusion. App. 59. The court of appeals affirmed, High-

way J Citizens Group v. U.S. Dept. of Transp. (“Citizens

IT), 456 F.3d 734 (7t» Cir. 2006) (App. 1-22), ruling that

the claim preclusion doctrine barred Citizens’ challenge

to the Highway 164 expansion project. /d. at 744 (App.

21). Py eue

REASONS FOR GRANTING THE PETITION

The Court Should Grant this Petition to Address

Conflict Among the Circuit Courts Regarding the Test

for Determination of the “Identical Claims” Prong of

Claim Preclusion Analysis.

This case presents the Court with an opportunity to

address and, hopefully, resolve long-standing intercir-

cuit conflict, as well as intracircuit confusion, as to the

proper standard for determining whether two claims

are identical under the claim preclusion doctrine (see ’

Part A below). The disposition of. the segmentation

claim in Citizens J is helpful in addressing that conflict

because there is substantial symmetry between the jus-

tifications for government segmentation of environmen-

tally impactful projects and for permitting a litigant to

split its claims (see infra pp.17-19). Moreover, such

segmentation claims are common in NEPA litigation

(see infra, p.17). sr

. The circuit courts have applied several different stan-

dards to determine whether claims are identical under

the claim preclusion doctrine.

Claim preclusion, historically known as res judicata,

precludes parties or those in privity with them from re-

litigating issues that were or could have been raised in

a previous action. Allen v. McCurry, 449 U.S. 90, 94

(1980). The three requirements for claim preclusion un-

der federal law are (1) identity of claims, (2) final judg-

ment on the merits in the previous action, and (3) priv-

ity between parties in the two actions. Hells Canyon

Preservation Coun. v. U.S. Forest Service, 403 F.2d 683,

686 (9th Cir. 2005) (quoting Headwaters, Inc. v. U.S.

Forest Service, 399 F.2d 1047, 1051-52 (9t» Cir. 2005)

(citation and internal quotation marks omitted)). In the

case at bar, only the “identity of claims” prong is in is-

sue. Citizens IT, 456 F.3d at 741 (App. 14-15).

There is “no test of universal applicability” for iden-

tity of claims. 18 Moore's Federal Practice 3d, §

131.20[1] (2006). Instead, “[clourts have developed vari-

ous approaches for dealing with this gray area, but

courts still face frustrating and difficult conceptual ob-

stacles in applying the claim preclusion doctrine in

some cases.” /d. See United States v. Athlone Indus.,

Inc., 746 F.2d 977, 983 (3d Cir. 1984) (“This court has

on more than one occasion grappled with the difficult

question of identity of causes of action for purposes of

claim preclusion ... [T]he term has been given varied

treatment depending upon the facts of each case and

the inquiry is often fraught with conceptual difficul-

ties.”)} Hermann v. Cencom Cable Assocs., Inc., 999

F.2d 223, 226 (7th Cir. 1993) (standard “is not as clear

as it might be ...”); Andersen v. Chrysler Corp., 99 F.3d

846, 852 (7th Cir. 1996) (“We have previously observed

the difficulty of articulating an ‘operational legal stan-

dard’ for identifying situations in which two causes of

action are so closely related that they must be brought

together, lest the first suit bar the second as res judi-

cata” (quoting Hermann, 999 F.2d at 226)).

Most federal courts employ, in whole or in part, the

“transactional” test described in Restatement (Second)

of Judgments (1982). Moore, supra, § 131.20[2]. The

transactional test is:

(1) When a valid and final judgment rendered in

an action extinguishes the plaintiffs claim pursu-

ant to the rules of merger or bar. . . the claim ex-

tinguished includes all rights of the plaintiff to

remedies against the defendant with respect to all

or any part of the transaction, or series of con-

nected transactions, out of which the action arose.

(2) What factual grouping constitutes a “transac-

tion,” and what groupings constitute a “series” are

to be determined pragmatically, giving weight to

such considerations as whether the facts are re-

lated in time, space, origin or motivation, whether

they form a convenient trial unit, and whether

their treatment as a unit conforms to the parties’

expectations or business understa.ding or usage.

Restatement (Second), supra, § 24. The comments ac-

companying that section indicate that the expression

“transaction, or series of connected transactions,” is “not

capable of a mathematically precise definition,” but

rather “invokes a pragmatic standard to be applied with

attention to the facts of the cases .... In general, the

expression connotes a natural grouping or common nu-

cleus of operative facts.” Jd, cmt. b. In Nevada v.

United States, 463 U.S. 110, 131 and n.12 (1983), this

Court quoted the “transactional” approach but found it

unnecessary to choose between that test and several

other historical tests for identity of claims.

Moore observes that the “Seventh Circuit has re-

jected the Restatement approach,” in favor of a rule

that “claims will be considered the same if they are

based on the same or nearly the same factual allega-

tions.” Moore, supra, § 131.203] (citing Hermann, 999

F.2d at 226). In Hermann, Judge Posner, writing for the

court, criticized the Second Restatement’s “pragmatic”

approach as a font of uncertain and unpredictable re-

sults:

We're all for pragmatism, but pragmatism is not

an operational legal standard. Litigants and their

lawyers are entitled to clearer guidance in an area

where a false step can result in the forfeiture of

valuable legal rights than generalities about prac-

ticality, convenience, similarities, and expectations

can furnish .... Where certainty is at a premium,

sound lawmaking requires the setting forth of

clear and definite criteria rather than a general

directive to decide each case in the manner that

will maximize the attainment of the law’s objec-

tives. The latter approach, carried to an extreme,

would reduce all law to an admonition to do what’s

right.

999 F.2d at 226. While no other circuit has explicitly

adopted the Seventh Circuit’s “factual allegations” test,

several have used it without comment. Moore, supra,

§131.20[3] and n.17 (collecting cases).

Other circuit courts, having embraced neither the

factual allegations test nor the transactional test in its

entirety, have followed “a hybrid approach which incor-

porates elements of the various historical tests.” Moore,

supra, § 131.20[4]. For example, the Third Circuit has

enunciated a standard based on “similarity of the acts

complained of, the material facts alleged as the basis for

the suit, and whether the witnesses and documentation

necessary to prove the allegations in the actions would

be the same.” /d. (citing Lubrizol Corp. v. Exxon Corp.,

929 F.2d 960, 963 (3d Cir. 1991)). The Sixth Circuit has

posited the test as “an identity of the facts creating the

right of action and of the evidence necessary to sustain

each action.” Sanders Confectionery Prods. v. Heller

Fin., Inc., 973 F.2d 474, 484 (6th Cir. 1992) (quoted in

Moore, supra, § 131.20[4]).

The First Restatement adopted the principle that

“causes of action were to be deemed the same ‘if the evi-

dence needed to sustain the second action would have

sustained the first action.” Nevada v. United States,

463 U.S. at 131 n.12 (quoting Restatement of Judg-

ments § 61 (1942)). The Second Restatement, without

explanation, endorses the “same evidence” test only as a

positive, not a negative, test for claim identity in the

larger context of the transactional standard. Hestate-

ment (Second), supra, § 24, cmt. b. The Seventh Circuit,

in contradictory fashion, has both rejected and em-

braced the “same evidence” test. Matter of Energy Co-

op., Inc., 814 F.2d 1226, 1230-31 (7 Cir. 1987) (reject-

ing test); Andersen, 99 F.3d at 852 (7 Cir. 1996) (em-

bracing test as corollary of factual allegations test).

Still other circuits “have welded the factors involved

in the [Second] Restatement approach onto one or more

of the historical tests.” Moore, supra, § 131.20[4]. The

Second Circuit has indicated that it will use the trans-

actional test but will also consider “whether an inde-

pendent judgment in a separate proceeding would im-

pair or destroy rights or interests established by the

judgment entered in the first action.” Sure-Snap Corp.

v. State St. Bank and Trust Co., 948 F.2d 869, 874 (2d

Cir. 1991) (quoted in Moore, supra, § 131.20[4]). That

test reflects the fact that the objectives of claim preclu-

sion include not only conserving judicial resources and

protecting parties from the expense and vexation of

multiple lawsuits, but also fostering reliance on judicial

action by minimizing the possibility of inconsistent de-

cisions. Montana v. United States, 440 U.S. 147, 153-54

(1979).

In the Ninth Circuit, identity of claims turns on:

(1) whether rights or interests established in the

prior judgment would be destroyed or impaired by

prosecution of the second action; (2) whether sub-

stantially the same evidence is presented in the

two actions; (3) whether the two suits involve in-

fringement of the same right; and (4) whether the

two suits arise out of the same transactional nu-

cleus of facts. The last of these criteria is the most

important.

Hells Canyon, 403 F.3d at 690 (quoting Costantini v.

Trans World Airlines, 681 F.2d 1199, 1201-02 (9t Cir.

1982) (citation and internal quotation marks omitted)).

See also Moore, supra, § 131.20[4] and n.26 (collecting

earlier Ninth Circuit cases). “[W]hen considering

whether a prior action involved the same ‘nucleus of

facts’ for preclusion purposes,” a court “must narrowly

construe the scope of that earlier action.” Centrai/ Delta

Water Agency v. United States, 306 F.3d 938, 953 (9th

Cir. 2002).

. Choice of the proper test for identity of claims is deter-

minative of the claim preclusion issue in the case at

bar. oF

While the court of appeals in the instant case cited

neither Hermann nor the Second Restatement, it ap-

plied the factual allegations test to find identity of

claims. The court stated: “A claim has ‘identity’ with a

previously litigated matter if it emerges from the same

core of operative facts as the earlier action.” 456 F.3d at

741 (App. 15) (quoting Brzostowski v. Laidlaw Waste

Systems, Inc., 49 F.3d 337, 338-39 (7t» Cir. 1995)).

Brzostowski in turn cites Colonial Penn Life Ins. Co. v.

Hallmark Ins. Admin., Inc., 31 F.3d 445, 447 (7 Cir.

1994), for that proposition, and in its next sentence, re-

duces that generality to the factual allegations test, cit-

ing Colonial Penn and Hermann: “Two claims are one

for purposes of res judicata if they are based on the

same, or nearly the same, factual allegations.”

Brzostowski, 49 F.3d at 339 (citing Colonial Penn, 31

F.3d at 447; and Hermann, 999 F.2d at 226).

Indeed, the court of appeals in the case at bar

clearly and entirely limited its analysis to comparison of

the allegations of the complaint in Citizens J with those

of the complaint in Citizens IT. 456 F.3d at 742-43 (App.

16-19). Moreover, the analysis stopped at the identifica-

tion of a nexus between those two complaints—namely,

the EIS prepared for the Highway 164 Project. Jd. The

court did not address the pragmatic concerns that the

Second Restatement describes, such as whether the

facts in the two cases are related in time, space, origin,

or motivation; whether they form a convenient trial

unit; and whether their treatment as such conformed to

the parties’ expectations. Nor did it address the factors

in standards for identity of claims that other circuits

have enunciated, such as whether rights or interests

established in the prior judgment would be destroyed or

impaired by prosecution of the second action, or

whether substantially the same evidence would be pre-

sented in the two actions.

_ While the factual allegations standard is on its face

“straightforward” and “easy to administer” compared to

the transactional test (Moore, supra, § 131.20[3]), the

flip side is that its monolithic nature entails the danger

of oversimplification. The test begs the following ques-

tions:

> At what level of specificity should the court exam-

ine the factual allegations of each case? In all but the

most extreme cases, this parameter affects the court’s

perception of the amount of factual overlap between the

cases. See Andersen, 99 F.3d at 852-53 (counseling that

courts should examine facts at “sufficient” level of speci-

ficity but providing no yardstick for determining appro-

priate level of specificity).

> Should the court measure only quantitative fac-

tual overlap, or also qualitative overlap—i.e., should it

assess the relative importance of common facts to each

claim? See id. at 855 (in two suits challenging severance

benefits and third challenging pension benefits under

one overall plan, plaintiffs considered amount of pen-

sion as “exogenous factor” in first two suits).

> How much factual overlap (however measured) is

sufficient to find identity of claims?

Judge Posner, writing for the Seventh Circuit in

Hermann, frankly recognized the limitations of the fac-

tual allegations test: “The difficult intermediate cases—

where there is substantial factual overlap between the

two claims, but not . . . a complete or nearly complete

lack of overlap—can be left for the future. Our formula-

tion is helpful only in the identification and disposition

of cases lying at the extremes... .” 999 F.2d at 227.

There is no better illustration of those limitations than

the case at bar.

Application of the transactional test or a hybrid test

to the instant case should have changed its result. As

the court of appeals in the case at bar recognized (456

F.2d at 741 (App. 15-16)), the two suits focus on sepa

rate construction projects. Moreover, each project pre-

sents different environmental problems. The Citizens J

complaint alleged that the Ackerville Bridge Project

would accelerate and aggravate groundwater contami-

nation in the area of its construction, and that the

agencies inadequately addressed that problem in ap-

proving that project in April 2000. The current suit has

nothing to do with groundwater contamination but,

rather, addresses entirely different environmental prob-

lems—air pollution, undesirable development, and de-

struction of wetlands—from the widening of Highway

164 in a separate and much more extensive area. That

suit alleges that the agencies inadequately addressed

those problems in approving that project in March

2002.

Because the challenges to the Ackerville Bridge Pro-

ject and the Highway 164 Project involve distinct (i.e.,

non-overlapping) locations, quite different and unre-

lated environmental problems, and markedly divergent

timelines, their facts—i.e., the challenged agency ac-

tions in each case—do not feature a close or significant

relation in time, space, or origin. It ought also to be ap-

parent that they do not form a convenient trial unit.

And in no way are the facts Citizens had to prove in

those two suits substantially similar.

An additional aspect of the differing timelines of the

two projects demonstrates that the court challenges to

them do not form a convenient trial unit. The court of

appeals stressed that Citizens could have challenged

the Highway 164 Project per se in its first suit, since

the Record of Decision (final approval) of that project

issued March 6, 2002, some four months before Citizens

filed that suit. 456 F.3d at 744 (App. 21); see also id. at

736-37 and n.6 (App. 5). This observation, however, es-

tablishes only a precondition for application of claim

preclusion. See Part II, infra. In practical fact, four

months is scant time to assess something as detailed,

technical, and voluminous as the Highway 164 Project

EIS and to make a reasoned, deliberate decision

whether to mount a court challenge te the project. On

the other hand, challenge to the Ackerville Bridge Pro-

ject could not wait: in July 2002, the agencies had “be-

gun to sink piles for construction,” which Citizens al-

leged would “allow contaminants below the surface to

mix with surface groundwater. . ..” App. 192-93. It is

counterproductive to judicial economy, and therefore to

the doctrine of claim preclusion, to push a plaintiff into

a hasty decision to bring claims that, upon more delib-

erate reflection, it might decide not to bring.

The Ackerville Bridge Project and the Highway 164

Project do not present a “natural grouping” of operative

facts that the transactional test requires for identity of

claims. The sole nexus between the two projects is the

segmentation claim in Citizens J, as the court of appeals

recognized in that case: “Citizens’ focus in this case is

Project #2748-01-00, the Ackerville Bridge Project. Pro-

ject #2748-01-01, the County J/Highway 164 Project, is

relevant to this litigation only because Citizens believes

that it was improperly segmented from the Ackerville

Bridge Project.” 349 F.2d at 942 (App. 65). In addition,

Citizens alleged that the segmentation was improper

not for any reason touching on the environmental issues

concerning the Highway 164 Project itself but, rather,

because segmentation enabled the EIS for that project

to avoid “addressling] the environmental issues raised

by the presence of the contaminate plume.” App. 198.

Those facts, to which the court of appeals did not al-

lude in the case at bar, are crucial to the claim preclu-

sion analysis. They demonstrate indisputably that the

Highway 164 Project entered into Citizens J only in re-

lation to the underlying facts unique to Citizens J and

the Ackerville Bridge .Project—facts uninvolved in Citi-

zens Ii—namely, the contamination of groundwater

with arsenic and trichloroethylene. The Highway 164

Project per se, like the pension plan in the two prede-

cessor suits in Andersen, was an exogenous factor, in

that Citizens’ contentions did not implicate the envi-

ronmental effects of that project. Both quantitatively

and qualitatively, then, the factual overlap between

Citizens’ two suits is undeniably minimal. Indeed, that

conclusion is irresistible not only from a reading of the

complaints in Citizens J (App. 186-202) and the instant

case (App. 203-43), but also from a reading of the dis-

trict court (App. 111-76) and court of appeals’ decisions

in Citizens I (App. 62-110).

For the same reason, reaching the merits in the in-

stant case could not conceivably impair the rights estab-

lished by the judgment in Citizens I. That judgment did

not address the adequacy of the EIS for the Highway

164 Project in relation to that project. Rather, the Citi-

zens I judgment sustained the Environmental Assess-

ment and Finding of No Significant Impact for the Ack-

erville Bridge Project. 349 F.3d at 962-63 (App. 108-09).

While that judgment may entail the corollary that the

Highway 164 EIS was not deficient for failing to ad-

dress the contamination plume problem implicated in

the Ackerville Bridge Project, a ruling on the merits of

the case at bar could find that EIS deficient in its as-

sessment of the different environmental problems im-

plicated in the Highway 164 Project, and such a ruling

would be completely consistent with the Citizens J judg:

ment and leave it completely intact.

The court of appeals’ focus on the EIS document it-

self as the factual nexus between the two cases demon:

strates the mechanistic nature of its claim identity

analysis, in contrast to the pragmatic, qualitative

analysis that the transactional test promotes. Thus, the

court concluded that the “previous contention lin the

segmentation claim] arose from the document that

forms the factual basis of the plaintiffs’ current claims”

(456 F.3d at 742 (App. 17)), and that “the underlying

factual transaction is identical: the preparation and fi-

nalization of the Highway 164 EIS” Ud. at 743 (App.

20)). Pragmatic claim preclusion analysis does not end

with mere identification of a document common to both

cases; the qualitative significance of the document to

both actions is the determining factor. See /n re Atlanta

Retail, Inc., 456 F.3d 1277, 1288-90 (11 Cir. 2006) (fact

that Intercreditor Agreement, central to contract and

fraud claims by one creditor against another, was before

bankruptcy court in previous proceedings to which both

creditors were party did not bar those claims in subse

quent proceedings).

The focus of Citizens J was an alleged groundwater

contamination problem, not a particular document or

the process of its creation. The gravamen of that suit

was not that the contamination problem had to be ad-

dressed in the Highway 164 EIS; it was, rather, that

the problem had to be addressed, period. Here, however,

the court simply fastened on that document as a means

to equate the fac: 1 «1 basis of the two suits, without tak-

ing into account tne document’s relative insignificance

to the prior suit and the peripheral nature of its rela-

tionship to the environmental problem there addressed.

Finally, disposition of the segmentation claim in

Citizens I demonstrates that the challenged govern-

ment actions in the two cases are not related in motiva-

tion, and treating those cases as a unit does not conform

to the parties’ expectations. Segmentation “addresses

an agency’s decision on where one project ends and an-

other begins.” Citizens J, 349 F.3d at 962 (App. 106). In

segmentation cases, courts must decide whether a fed-

eral action on which an EIS has been prepared has been

improperly segmented from other related action that

should have been considered as part of the same action.

Daniel R. Mandelker, NEPA Law and Litigation § 9:11

(2d ed. 2006). NEPA litigation frequently features seg-

mentation issues. See id. §§ 9:11 — 9:17 (collecting

cases).

Disposition of the segmentation issue necessarily in-

fluences the analysis of the identity of claims issue. The

seminal CEQ regulation on segmentation states: “Pro-

posals or parts of proposals which are related to each

other closely enough to be, in effect, a single course of

action shall be evaluated in a single impact statement.”

40 C.F.R. § 1502.4(a) (App. 181). The analogy between a

government agency’s segmentation of projects and a

litigant’s splitting of claims attacking those projects is

obvious: the conditions for their allowance are related.

Under CEQ regulations, agency actions are “con:

nected,” and therefore “closely related,” if they: “G)

Automatically trigger other actions which may require

environmental impact statements. (ii) Cannot or will

not proceed unless other actions are taken previously or

simultaneously. (iii) Are interdependent parts of a lar-

ger action and depend on the larger action for their jus-

tification.” 40 C.F.R. § 1508.25(a)(1) (App. 182). Accord-

ingly, the FHWA regulation addressing segmentation

requires that the action evaluated in each impact

statement or finding of no significant impact shall:

(1) Connect logical termini and [be] of sufficient

length to address environmental matters on a

broad scope; (2) Have independent utility or inde-

pendent significance, 1.e., be usable and be a rea-

sonable expenditure even if no additional trans-

portation improvements in the area are made; and

(3) Not restrict consideration of alternatives for

other reasonably foreseeable transportation im-

provements.

23 C.F.R. § 771.111(f) (App. 183). The court of appeals

in Citizens J examined those factors and held that each

one supported the agencies’ treatment of the Ackerville

Bridge and Highway 164 work as separate projects. 349

F.3d at 963 (App. 106-09.)

It is highly significant to the identity of claims issue

in the instant case that the agencies treated the pro-

jects separately, and that the courts overruled Citizens’

previous contention that they did so unlawfully. The

Citizens I court, in reaching the conclusion that each

project had independent utility, contrasted the underly-

ing agency motivations: the safety focus of the Acker-

ville Bridge Project and the highway expansion focus of

the Highway 164 Project. Jd. (App. 109). Moreover, Citi-

zens I found that the record did not support the proposi-

tion that the Ackerville Bridge Project had been pretex-

tually more concerned with road-widening than safety,

agreeing instead with the agencies that “the need to

bridge the train tracks is the driving force behind this

IT.

project.” Jd. (App. 108) (internal quotation marks omit-

ted).

In other words, the agencies took and the courts en-

dorsed the position that a challenge to the Highway 164

Project was unavailable to Citizens based on the opera-

tive facts pertaining to the Ackerville Bridge Project. It

is simply incongruous for the court of appeals in the

case at bar, then, to have ruled that Citizens’ allusion to

the Highway 164 EIS in its rejected segmentation claim

transformed the two suits into one for claim preclusion

purposes. Similarly, while the court of appeals relied on

its observation that “the relief requested in the present

action is similar in substantial ways to the relief re-

quested in Citizens P (id. at 742 (App. 17)), the relief

requested against the Highway 164 Project in the first

suit cannot logically support claim preclusion when the

judicially sanctioned segmentation of the two projects

necessarily foreclosed such relief based on the operative

facts in that suit. See Dore v. Kleppe, 522 F.2d 1369,

1374 (5 Cir. 1975) (‘claim preclusion is a principle of

public policy and should be applied so as to give rather

than deny justice” (citation omitted)).

In sum, an appropriately narrow construction of the

scope of Citizens /—i.e., a construction that applies the

pragmatic considerations set forth in the transactional

and various historical; tests for claim preclusion—

ineluctably demonstrates that the case at bar does not

arise from the same nucleus of operative facts.

The Court Should Grant this Petition to Address a

Conflict Among the Circuit Courts Regarding the Effect

on Claim Preclusion Analysis of Facts that Did Not Ex-

ist During the Pendency, or in-Any Event at the Incep-

tion, of the Previous Action.

“(Slignificant new circumstances or information

relevant to environmental concerns and bearing on the

proposed action or its impacts” requires the preparation

of an SEIS. 40 C.F.R. § 1502.9(c)(1)(ii) (App. 184). The

complaint in the current suit alleges that “in October

2003, WisDOT held a public information meeting to an-

nounce that three overpasses which had been included

in the selected alternative [for the Highway 164 Pro-

ject], as presented in the EIS and approved in the ROD

[Record of Decision], would be replaced by at-grade

crossings or intersections.” App. 229-30. According to

the complaint, “[ellimination of these overpasses re-

duces the safety improvements which were to be ac-

complished by this project, and increases a number of

the environmental impacts on surrounding residents

and resources.” App. 230. Citizens’ Fifth Cause of Ac-

tion alleges that in light of those changes to the High-

way 164 Project, as well as new information about the

project’s environmental impacts, failure to prepare an

SEIS constituted a violation of NEPA. Jd. (App. 234-35).

The district court dismissed Citizens Jin June 2003.

349 F.3d 938 (App. 174.) The complaint in the case at

bar therefore alleges that the changes in the Highway

164 Project occurred well after that dismissal. Nonethe-

less, the court of appeals’ sweeping claim preclusion rul-

ing barred Citizens’ claim seeking preparation of an

SEIS based on the alleged October 2003 changes. In

that respect, the ruling conflicts with those of a number

of other circuits, as well as of this Court.

If new facts—that is, facts arising after the disposi-

tion of a previous action—in themselves establish inde-

pendent grounds for a claim against the defendants in a

previous action, claim preclusion does not apply, even if

the new claim is based on the same legal theory as the

prior action. Moore, supra, § 131.22[1]. In Lawler v. Na-

tional Screen Serv. Corp., 349 U.S. 322, 328 (1955), this

Court held that a judgment dismissing a prior antitrust

action alleging a conspiracy to monopolize could not bar

a second action between the same parties alleging such

a conspiracy based on conduct that allegedly occurred

subsequent to the prior judgment. A prior judgment

“cannot be given the effect of extinguishing claims

which did not even then exist and which could not pos-

sibly have been sued upon in the previous case.” /d.

Claim preclusion “does not ... bar a suit based on acts

of the defendant that have occurred subsequent to the

final judgment asserted as a bar.” Blair v. City of

Greenville, 649 F.2d 365, 368 (5 Cir. 1981) (dismissal

of prior employment discrimination action did not pre-

clude new action based on discriminatory acts allegedly

occurring after prior judgment). See also Ripplin Shoals

Land Co., LLC v. U.S. Army Corps of Engineers, 440

F.3d 1038, 1043 (8th Cir. 2006) Gudgment that COE’s

permission to add to existing low-water bridge violated

NEPA did not bar subsequent claim to compel action on

application, submitted after prior judgment, for new

bridge span in same location); American Cyanamid Co.

v. Capuano, 381 F.3d 6, 17 (1% Cir. 2004) (settlement of

prior action seeking contribution for soil cleanup at

waste disposal site did not bar action seeking contribu-

tion for groundwater cleanup at same site because

groundwater remediation had not occurred at time of

settlement).

The decision of the court of appeals in the instant

case also conflicts with The New River Valley Greens v.

U.S. D.O.T., 161 F.3d 3, 1998 WL 633959 (4t Cir. 1998)

(unpublished disposition),4 a case decided under NEPA.

There the plaintiffs had unsuccessfully challenged the

failure to prepare a SEIS concerning a decision by gov-

ernment agencies to move a portion of a previously ap-

proved highway project. 1998 WL 633959 at *1. An In-

telligent Transportation System (ITS) was part of the

highway project, but the agencies had not yet developed

its specific design and, accordingly, the EIS could not

evaluate it in detail. Nor did the agencies have the de-

tails by the time of the judgment. After dismissal of the

first. suit, the agencies completed and revealed the de-

sign of the ITS. The plaintiffs again sued to require a

SEIS, this time concerning the impact of the ITS. Jd. at

“

The court of appeals held that the prior judgment

could not bar a challenge to the agencies’ failure to pre-

pare an SEIS based on details of the ITS design that

the agencies had developed after that judgment: “NEPA

compliance is never really done until all major federal

action is done. Hence, there is a viable question pre-

sented by this suit: whether the details of the ITS hard-

ware compelled the preparation of a Supplemental EIS

(SEIS’).” Jd. at *3. The court reasoned: “It would be in-

congruous with... [NEPA’s] manifest concern with pre-

venting uninformed action, for the blinders to adverse

environmental effects, once unequivocally removed, to

be restored prior to the completion of agency action

simply because the relevant proposal has received ini-

tial approval.” /d. (quoting Marsh v. Oregon Natural

Resources Coun., 490 U.S. 360, 371 (1989)).

4 Circuit Rule 36(c) of the Fourth Circuit permits citation of an

unpublished opinion of that court if counsel! believes that it “has

precedential value in relation to a material issue in a case and

that there is no published opinion that would serve as well... .”

The ruling of the court of appeals here, to the extent

that it bars Citizens’ challenge to the Highway 164 Pro-

ject based on the agencies’ changes to that project sub-

sequent to judgment in Citizens J, is so fundamentally

unsound that it calls for an exercise of this Court’s su-

pervisory power, even apart from the conflict of that

ruling with decisions in other circuits.

In addition to the alleged October 2003 changes,

Citizens based their Fifth Cause of Action on other new

information that allegedly “demonstrates the existence

of impacts on travel demand, total vehicle trips, motor

vehicle emissions, and health risks not contemplated by

the defendants in the original EIS.” App. 234-35. Citi-

zens alleged that this information “has become avail-

able during and after preparation of the EIS %

App. 234..Some such information may have become

available not only after preparation of the EIS but also

after commencement or even the dismissal of Citizens I,

or the agencies’ declination to prepare an SEIS on the

basis of that new information may have followed one or

both events. The pleadings do not eliminate those pos-

sibilities, and because no court has reached the merits,

the claim preclusion analysis necessarily proceeded on

the basis of the pleadings.

To the extent that such new information developed

after the Citizens J judgment, it is equivalent for claim

preclusion purposes to the October 2003 project changes

just discussed. To the extent that such new information

predated that judgment but postdated commencement

of that case, it invokes a conflict among circuit court de-

cisions. Various circuits have held that claim preclusion

does not bar claims that arise after commencement of

suit but before judgment. S.E.C. v. First Jersey Secuii-

ties, Inc., 101 F.3d 1450, 1464 (2d Cir. 1996), cert. de-

nied, 522 U.S. 812 (1997), held:

If a defendant engages in actionable conduct af:

ter a lawsuit is commenced, the plaintiff may

seek leave to file a supplemental pleading to as-

sert a claim, based on the subsequent conduct.

See Fed.R.Civ.P. 15(c). But he is not required to

do so, and his election not to do so is not penal-

ized by application of res judicata to bar a later

suit on that subsequent conduct.

See also Manning v. City of Auburn, 953 F.2d 1355,

1360 (11t Cir. 1992) (“We do not believe that the res

judicata preclusion of claims that ‘could have been

brought’ in earlier litigation includes claims which arise

after the original pleading is filed in the earlier litiga-

tion.”); Drake v. F.A.A., 291 F.3d 59, 66-67 (D.C. Cir.

2002) (no claim preclusion of claim based on agency ac-

tion occurring after commencement of previous lawsuit

against agency concerning legality of drug testing of air-

line employee). But see Stone v. Dept. of Aviation, 453

F.3d 1271, 1278 (10 Cir. 2006) (claim preclusion “doc-

trine requires a plaintiff to join all claims together that

the plaintiff has against the defendant whenever during

the course of the litigation related claims mature and

are able to be maintained”; plaintiff must seek to

amend complaint to add claims that mature after filing

of initial complaint); Havercombe v. Dept. of Educ. of

Com. of P.R., 250 F.3d 1, 8 (1st Cir. 2001) (claim based

on discriminatory conduct allegedly occurring after time

period covered by judgment in prior action was barred,

where plaintiff could have moved to amend complaint to

include claim in that action).

IIT.

The Court Should Grant this Petition in the Exercise of

Its Supervisory Power to Consider the Circumstances in

which a Court of Appeals May Depart from Random As-

signment of Panel Judges.

The three judges who comprised the court of appeals

panel in the case at bar are the same three judges who

heard the appeal in Citizens J (App. 1, 62). The chance

that random assignment of judges in the second case

would yield this result is so miniscule as to exclude it

under the rubric of Occam’s razor. See Brown v. Vance,

637 F.2d 272, 281 (5t» Cir. 1981) (simple and obvious

explanation for “startling” disparity of traffic ticket

caseloads among judges in certain counties is that ar-

resting officers make affidavits returnable to the judge

they believe most likely to convict the defendant). The

panel assignment in this case was not random.

Internal Operating Procedure 6 of the Seventh Cir-

cuit provides for assignment of an appeal to the same

panel that heard a previous appeal in three situations:

(a) where this Court has remanded for further proceed-

ings, (b) a successive appeal in the same case, and (c) a

successive petition under 28 U.S.C. §§ 2254 or 2255.5

Because (a) and (c) do not even colorably apply here, the

court implicitly treated the case at bar as a successive

appeal in the same case under IOP 6(b) (App 184-85).

Obviously, it is not. Citizens commenced the Febru-

ary 2005 suit as a separate, original action in the dis-

5 IOP 6(d) provides that when a motion panel sets a motion or

petition for oral argument or expedites the appeal, the appeal

may be assigned for argument and decision to the same panel.

There was no motion panel or expedited appeal in the case at

bar.

trict court. That event occurred almost two years after

the district court’s final judgment in Citizens 1, Each

case had a separate file number, both in the district

court and in the court of appeals. (App. 1, 23, 62, 111).

The Seventh Circuit has in other cases invoked IOP

6(b), which applies by its terms only to successive ap-

peals in the same case, to treat (or indicate that it

would treat) an appeal as a “successive” one to an ap-

peal in a different case, when it deemed the cases to be

sufficiently “related.” See, e.g., Blair v. Equifax Check

Services, Inc., 181 F.3d 832, 839 (7 Cir. 1999) (sepa-

rate plaintiffs’ class actions raised the same issues

against same defendant; one class was subset of an-

other but class representatives were different in each

case); Brokaw v. Weaver, 305 F.3d 660, 663 (7 Cir.

2002) (separate constitutional tort actions against fam-

ily members and public officials by siblings who been

removed from parents). See also McDermott, Inc. v.

Wheelabrator-Frvye, Inc., 649 F.2d 489, 492 n.7 (7 Cir.

1980) (appeals in separate cases involving rival tender

offerors for stock of the same company assigned to same

panel).

While litigants acquire no rights under the Seventh

Circuit’s Internal Operating Procedures (see Preamble

to Internal Operating Procedures), that fact does not

circumscribe this Court’s supervisory power over the

courts of appeals. And this case calls for an exercise of

that power.

Neutral assignment of appellate judges to panels

“represents a critical and underestimated component of

the judicial process. Because judges are human and

bring a basket of biases to the bench, it is their neutral

selection that helps preserve judicial integrity.” J.

Robert Brown, Jr. and Allison Herren Lee, Neutra/ As-

signment of Judges at the Court of Appeals, 78

TEX.L.REV. 1037, 1102 (2000) (footnotes omitted). To

create neutrality, every circuit uses a random assign’

ment system to compose three-judge panels. /d. at 1041

(footnote omitted); Jonathan R. Macey, Judicial Prefer:

ences, Public Choice, and the Rules of Procedure, 23 J.

LEGAL STUD. 627, 630 (1994) (describing random as-

signment as a central characteristic of federal judicial

procedure); Practitioner's Handbook for Appeals to the

United States Court of Appeals for the Seventh Circuit

at 8 (2003). Brown and Lee, however, on the basis of

their detailed empirical study of assignment practices

in the circuits, reported that “substantial amounts of

discretion erode the randomness of those systems.”

Brown and Lee, supra, at 1041-42 (footnote omitted).

Brown and Lee argue for limits on discretion and

greater transparency in panel assignment decisions in

federal courts.

The potential for “outcome-oriented assignments... .

does exist in any system with excessive discretion. Ex-

cessive discretion is inherent in any system that does

not objectively define the exceptions to random assign-

ment... .” /d. at 1102 (footnote omitted). In fact, per-

ceptions of discretionary departures from random as-

signment of panel judges have fueled considerable de-

bate and tension within several federal circuit courts

and in the public arena. For example, in 1963, Judge

Cameron of the Fifth Circuit, as well as the media, ac-

cused that court of manipulating panel assignments in

several key civil rights cases. See id. at 1043-65. In

2002, Judge Boggs of the Sixth Circuit, in a high-profile

case challenging the constitutionality of a law school’s

affirmative action admission policy, accused the chief

circuit judge of attempting to influence the outeome by

disregarding an internal operating procedure calling for

random assignment to replace an absent panel member.

Grutter v. Bollinger, 288 F.3d 732, 810-814 (6% Cir.

2002) (Boggs, J., dissenting), affd 596 U.S. 306 (2003).

Because the assignment of the instant case to the

same panel that heard Citizens J entails a discretionary

departure from a random assignment system, it poses a

serious problem for the principle of neutrality.* The sole

issue was whether the judgment reviewed in the first

appeal barred the claim made in the second. Treating

the latter as a successive appeal in the same case, when

procedurally it was not, was tantamount to a prejudg-

ment that claim preclusion should apply. Whether or

not the panel itself caused the assignment, it necessar-

ily knew that it had the case only because it had been

deemed “the same case” as Citizens J, which was, in es-

sence, the very issue on which the appeal would ise or

fall.

The problem hardly disappears if the cases are

deemed to be related rather than the same under an

expansive (and insupportable) interpretation of IOP

6(b). The practice of departing from random panel as-

signment, by assigning the same panel that heard a

previous appeal in a different case when the cases are

deemed to be sufficiently “related,” presents both a gen-

eral neutrality problem and such a problem specific to

the case at bar. The general problem is that the practice

represents a departure from a random assignment sys-

6 Because the Seventh Circuit's practice is not to reveal the iden-

tity of panel members until the day of oral argument (Practitio-

ner’s Handbook, supra, at 8), Citizens had no meaningful oppor-

tunity to object to the composition of the panel in the case at

bar.

tem that is not only unnecessary but also dangerous. It

infects that system with “excessive discretion” because

thé parameters governing the judgment of case-

relatedness, as well as the identity of the person(s)

making that judgment, are unknown to the litigants.

The specific problem with the “related case” practice

in this case—where, unlike Blair, Brokaw, and McDer-

mott, claim preclusion is not only an issue but the is-

sue—is that the under IOP 6(b), the panel could retain

the appeal only by, in essence, prejudging that issue. A

panel assigned to the successive appeal must as a

threshold matter determine whether it will retain it for

decision on the merits. It is to do so “unless there is no

overlap in the issues presented.” That exception cer-

tainly applies here, where no claim preclusion issue was

present in Citizens / and it is the only issue in Citizens

II. Even then, however, the panel still may retain the

appeal when it “involves the same essential facts as the

earlier appeal.” Thus, the panel must have essentially

decided the claim preclusion issue simply in order to

retain the appeal. Put differently, under IOP 6(b) the

panel assigned to the case at bar could only have de-

cided the claim preclusion issue as it did.

The panel assignment procedure in the case at bar

casts a shadow over the perceived integrity of the appel-

late decisionmaking process. Moreover, it illustrates an

issue—the proper limits of discretion in departing from

random assignment of panel judges—that clearly ex-

tends beyond this case and is crucial to the actual and

perceived neutrality of the federal appellate courts. As

such, it is an issue both well-suited to and needful of

this Court’s exercise of its supervisory power.

CONCLUSION

For the reasons stated, the petition for writ of cer-

tiorari should be granted.

Charles H. Barr

Counsel of Record

Croen & Barr LLP

250 East Wisconsin Avenue

Suite 1550

Milwaukee, WI 53202

414-226-2080

Jeremy P. Shapiro-Barr

Chernov, Stern & Krings, S.C.

Two Plaza East, Suite 1275

330 East Kilbourn Avenue

Milwaukee, WI 53202

414-276-4080

Counsel for Petitioners

Dated: January 10, 2007

APPENDIX

Decision of Court of Appeals

dated August 2, 2006 (Citizens ID .......ccccccccccccccceeeeee 1

Decision and Order of District Court

dated April 27, 2005 (Citizens ID ....cc..cccccceceescceeeees 23

Decision of Court of Appeals |

dated November 5, 2003 (Citizens D o..........ccccc cc eeee 62

Decision and Order of District Court

dated June 4, 2003 (Citizens D oocccccccccccccccccececceeeee 111

Order of Court of Appeals

dated October 12, 2006 (Citizens ID) ...........ccccc00e 177

denying Petition for Rehearing

Statutes and Regulations Involved ..... Se acne 178

Complaint dated July 3,2002 (Citizens D ............. 186

Complaint dated February 22, 2005

ETD ccerccecisctnntdiniuibidiatatieen eet kat 203

Map of Ackerville Bridge Project

Loontion . 1-2 Of BIB) ..cceccccsoasovessoversesescevocssocsveren 244

App. l

In the

United States Court of Appeals

For the Seventh Circuit

(456 F.3d 734)

No. 05-2667

HIGHWAY J CITIZENS GROUP

and WAUKESHA COUNTY -

ENVIRONMENTAL ACTION LEAGUE,

Plaintifts-Appellants,

UNITED STATES DEPARTMENT OF

TRANSPORTATION, MARIA CINO,! Acting

Secretary of Transportation, FEDERAL

HIGHWAY ADMINISTRATION, et al.,

Detendants-Appellees.

Appeal from the United States District Court

for the Eastern District of Wisconsin.

No. 05 C 212—Lynn Adelman, /udge.

ARGUED FEBRUARY 14, 2006—DECIDED AUGUST 2, 2006

Before BAUER, RIPPLE and WILLIAMS, Circuit Judges.

1 Pursuant to Federal Rule of Appellate Procedure 43(c)(2), we

have substituted the current acting United States Secretary of

Transportation, Maria Cino, for her predecessor, Norman

Mineta, as the named respondent.

App. 2

RIPPLE, Circuit Judge. In 2005, the Highway J

Citizens Group (“Citizens”) and the Waukesha County

Environmental Action League (“WEAL”) brought this

action against the United States Department of

Transportation (“DOT”), the Secretary of

Transportation in his official capacity, the Federal

Highway Administration (“FHWA”), Mary Peters in her

official capacity as the Administrator of FHWA, the

United States Army Corps of Engineers (“Corps”),

Michael Pfenning in his official capacity as District

Engineer for the Corps, and Frank Busalacchi in his

official capacity as Secretary of the State of Wisconsin

Department of Transportation (“WisDOT”). The

plaintiffs alleged that federal approval of a project to

expand an eighteen-mile segment of the former County

Highway J/Wisconsin State Highway 164 violated the

Administrative Procedure Act (“APA”), 5 U.S.C. § 500

et seq.; the Clean Water Act (“CWA”), 33 U.S.C. § 1344;

the Federal-Aid Highway Act (“FAHA”), 23 U.S.C. §

101 et seq.; and the National Environmental Policy Act

of 1969 (“NEPA”), 42 U.S.C. § 4321 et seq. The district

court denied the plaintiffs’ motion for a preliminary

injunction; it held that the plaintiffs had not

demonstrated a reasonable likelihood of success on the

merits of their claims because those claims likely were

barred by claim preclusion. The plaintiffs now appeal.

They contend that the doctrine of ‘res judicata is not

applicable to the present case because the claims that

they seek to litigate here are factually and legally

distinct from those that they litigated previously.

Because we believe that the district court correctly held

that this action is barred by res judicata, we affirm the

judgment of the district court.

App. 3

BACKGROUND

A. Facts

There are two construction projects at issue in this

litigation; both are “major Federal actions” as defined

2 The National Environmental Policy Act (“NEPA”) requires

that a recommendation for any “major Federal actionl]

significantly affecting the quality of the human environment”

include a “detailed” Environmental Impact Statement (“EIS”)

describing:

(i) the environmental impact of the proposed action,

(ii) any adverse environmental! effects which cannot be

avoided should the proposal be implemented,

(iii) alternatives to the proposed action,

(iv) the relationship between local short-term uses of

man’s environment and the maintenance and

enhancement of long- term productivity, and

(v) any irreversible and irretrievable commitments of

resources which would be involved in the proposed action

should it be implemented.

42 U.S.C. § 4332(C); see also 40 C.F.R. § 1502.14 (further

defining what an EIS must contain). Federal-Aid Highway Act

(“FAHA”) regulations impose similar requirements. See 23

C.F.R. § 771.123 (setting forth applicable procedures and

requiring that the “draft EIS ... evaluate all reasonable

alternatives to the actionl,] [] discuss the reasons why other

alternatives, which may have been considered, were eliminated

from detailed study [and] . . . summarize the studies, reviews,

consultations, and coordination required by environmental laws

or Executive Orders to the extent appropriate at this stage in

the environmental process”).

App. 4

by federal environmental regulations.? The first, the

County J/Highway 164 Project (Project # 2748-01-01),

involves the expansion of an eighteen-mile segment of

Wisconsin State Highway 164‘ from two to four lanes.

In 1999, these eighteen miles, which run through

Waukesha and Washington Counties in Wisconsin,

were experiencing substantial traffic congestion, delays

and related safety issues. The Wisconsin Department of

Transportation (“WisDOT”) commissioned a study of

proposals to increase the highway’s capacity. The

WisDOT, in conjunction with the Federal Highway

Administration (“FHWA”) and as required by federal

law, subsequently drafted an Environmental Impact

Statement (“EIS”) that recommended widening the

highway. See R.19, Ex.5. The proposed expansion

converts approximately 100 acres of land for highway

use and, according to the plaintiffs, raises significant

3 See 40 C.F.R. § 1508.18 (defining a “[m]ajor Federal action”

as an action “with effects that may be major and which are

potentially subject to Federal control and responsibility. Major

reinforces but does not have a meaning independent of

significantly (§ 1508.27). Actions include the circumstance

where the responsible officials fail to act and that failure to act

is reviewable by courts or administrative tribunals under the

Administrative Procedure Act or other applicable law as agency

action”).

4 When initially constructed in the 1970s, this highway was

designated “County Highway J.” However, in 1986, the relevant

section of the highway was transferred to the WisDOT and was

redesignated “Highway 164.” We therefore refer to the road as

“Highway 164” and to the project as the “Highway 164 Project”

throughout this opinion.

App. 5

environmental concerns with regard to the destruction

of wetlands.

The EIS for the project was made available to the

public on April 9, 2001, and a public hearing was held

on May 30, 2001. On December 11, 2001, the FHWA

and WisDOT issued a revised EIS: this document

addresses alternative proposals raised during the

hearing, but concludes in favor of expanding the

highway. The DOT and FHWA issued a Record of

Decision (““ROD”)® on March 6, 2002, marking their

final approval of the recommendations contained in the

revised EIS. Construction by WisDOT, using federal

funds appropriated under FAHA, now has commenced

on this project. Phase I was completed in late 2004; on

January 14, 2005, the Army Corps granted a permit

under § 404 of the CWA to the WisDOT to fill 9.27

acres of wetlands, thus allowing the WisDOT to

commence Phase II of the project.

The second project, Project # 2748-01-00, is known as

the “Ackerville Bridge/Lovers Lane Reconstruction

Project” (“Ackerville Bridge Project”). It primarily

5 Highway 164 is located within the Upper Fox portion of the

Illinois-Fox River watershed: this area is considered a “Priority

Watershed” by the Wisconsin Department of Natural

Resources. See R.10, Ex.A.

6 FAHA and NEPA regulations require the FHWA and DOT,

respectively, to certify their final approval of a major federal

action by issuing a Record of Decision (“ROD”). The ROD must

“present the basis for the [agency’s] decision” and “summarize

any mitigation measures that will be incorporated in the

project.” 23 C.F.R. § 771.127(a); see also 40 C.F.R. § 1505.2(b)

(requiring the relevant agency to identify the alternatives

considered and the considerations balanced in reaching a final

decision).

App. 6

involves the construction of two overpass structures on

Highway 164 in Washington County, near the northern

end of the highway expansion project. One overpass

will cross railroad tracks, thus eliminating the need for

existing at-grade crossings; thesecond overpass will

facilitate passage over State Highway 175. Like the

Highway 164 expansion project, the new overpass

structures are designed to ease the flow of traffic.

The Ackerville Bridge Project commenced with the

FHWA and WisDOT’s preparation of an Environmental

Assessment (“EA”).7 After a public hearing was held in

March 2000, the FHWA issued a “Finding of No

Significant Impact”; the FHWA concluded that the

construction of the overpasses would not affect

’ NEPA regulations provide that, when the significance of the

environmental impact of a transportation project proposal is

uncertain, an Environmental Assessment (“EA”) should be

prepared to assist in making this determination. The EA

should:

(1) Briefly provide sufficient evidence and analysis for

determining whether to prepare an environmental impact

statement or a finding of no significant impact.

(2) Aid an agency’s compliance with the Act when no

environmental impact statement is necessary.

(3) Facilitate preparation of a statement when one is necessary.

40 C.F.R. § 1508.9{a). The EA also must “include brief

discussions of the need for the proposal, .. . of the

environmental impacts of the proposed action and alternatives,

and a listing of agencies and persons consulted.” Jd. § 1508.9(b).

If a finding of no impact is made, no further action is required.

If, however, the agency makes a preliminary finding that the

project may result in significant environment impacts, it must

commence immediately the preparation of an EIS.

App. 7

significantly the quality of the human environment.

Construction on this project began in May 2002.

B. The Citizens J Litigation

Highway J Citizens Group (“Citizens”) is an

unincorporated association representing citizens of

Waukesha and Washington Counties in Wisconsin

“who are concerned about the potential destruction of

the region along [Highway] 164 and [County Highway]

J.” R.1 at 6. According to the complaint in this case,

Citizens’ mission includes “maintaining Highway 164

as a two-lane scenic roadl[,] [J maintaining the

environmental resources and preserving the remaining

rural character of the area.” /d.

In July 2003, Citizens filed suit in the United States

District Court for the Eastern District of Wisconsin

against the Secretary of Transportation in his official

capacity; Frederick Wright in his official capacity as

Executive Director of the FHWA; and Thomas E.

Carlsen in his official capacity as Acting Secretary of

the WisDOT. Citizens alleged that the defendants’

approval of the Highway 164 and Ackerville Bridge

projects violated the APA, 5 U.S.C. §§ 701-06; NEPA,

42 U.S.C. § 4321 et seq.; regulations implementing

NEPA; and the Wisconsin Environmental Policy Act

(“WEPA”), Wis. Stat. § 1.11, Wis. Admin. Code Transp.

§ 400 et seq. Citizens first claimed that drilling for the

Ackerville Bridge Project risked disturbing an

underground “contamination plume” containing arsenic

and trichlorethylene, which was migrating towards the

site of construction. Highway J Citizens Group v.

Mineta, 349 F.3d 938, 942 (7th Cir. 2003) (“Citizens I”).

Citizens requested that the court enjoin the continued

construction of the Ackerville bridges, as well as

require the defendants to fill current holes with

App. 8

concrete. They also asked the court to mandate that the

defendants conduct another environmental impact

study; they claimed that the EA for the Ackerville

Bridge Project failed to examine the implications of the

contamination plume. Second, Citizens contended that

the FHWA and WisDOT had failed to consider

reasonable alternatives to the building of the Ackerville

bridges. Lastly, Citizens claimed that the defendants

had improperly segmented’ the Ackerville Bridge

Project from the Highway 164 Project. See Citizens I

Complaint, Supp. App. at 192 (arguing that the two

actions constitute “one project or, if not, the Lovers

Lane Road/Ackerville Project is an interdependent part

of the larger action and depends on the larger action for

its justification”). According to Citizens, both the EIS

for the Highway 164 Project and the EA and Finding of

No Significant Impact for the Ackerville Bridge Project

were incomplete because each project failed to take into

account the environmental impacts of the other. See id.

at 193. As a remedy, Citizens requested that the court

require the defendants to prepare another “[EIS] for all

of the County J/Highway 164 project,” as well as

“enjoin{] the defendants from widening County

J/Highway 164... from two lanes to four lanes.” /d. at

193-94.9

8 Segmentation is a procedure that “allows an agency to avoid

the NEPA requirement that an EIS be prepared for all major

federal actions with significant environmental impacts by

segmenting an overall plan into smaller parts involving action

with less significant environmental effects.” City of West

Chicago v. United States Nuclear Regulatory Comm'n, 701 F.2d

632, 650 (7th Cir. 1983).

9 Citizens also requested that the court enjoin the

reconstruction and realignment of Lovers Lane Road, which is

considered part of the Ackerville Bridge Project. Lovers Lane is

(Continued...)

App. 9

On June 12, 2003, the district court denied

Citizens motion for a preliminary injunction and then

ruled against Citizens on the merits. In pertinent part,

the district court determined that the defendants’

environmental analysis was thorough and sufficient, as

was their consideration of feasible alternatives. The

district court further found that the defendants had

made a “reasonable decision in establishing the project

termini” and that the Ackerville Project had not been

segmented improperly from the Highway 164 Project.

Id. at 179.

Citizens appealed. We affirmed the judgment of the

district court. See Citizens I, 349 F.3d 938. We agreed

with the district court that the defendants’

environmental analysis and _ consideration of

alternatives were sufficient. See id. at 952-62. We also

affirmed the district courts holding on_ the

segmentation issue:

In the [EA and Finding of No Significant

Impact], the defendants explicitly considered the

three criteria for segmentation set out in 23

C.F.R. § 771.111, and gave a_ reasoned

justification of how their segmentation fit each

factor. As to logical termini, the defendants

explained that “islince the need to bridge the

train tracks is the driving force behind this

project,” the south termini for the Project was

(...continued)

the name of the northern-most portion of Highway 164, after it

crosses the trackage of the Wisconsin Central Limited and the

Wisconsin Southern Railroads.

App. 10

established just beyond the bridge touchdown

point.

The second factor, independent utility, is the

most important factor in highway cases such as

this. ... With respect to this factor, the [EA and

Finding of No Significant Impact] pointed out

that neither the bridge construction project, with

its safety focus, or the County J/Highway 164

Project, with its expansion focus, require the

construction of any other projects to be usable.

Finally, as to the third factor, restriction of

alternatives, the Ackerville Bridge Project

contemplates, rather than restricts, future

roadway projects, including the possibility of a

four-lane project if found to be needed. Indeed,

making space for future expansion was a

“secondary purpose” for the Project in the first

place.

In sum, the defendants analyzed the relevant

factors set out in 23 C.F.R. § 771.111(f)(1)-(3),

and came to a reasoned conclusion. There is also

no real evidence to support pretextual motive.

Accordingly, we hold there was no improper

segmentation in this case.

Id. at 963 (internal citations omitted).

C. The Present Litigation

On February 22, 2005, Citizens, together with WEAL,

a Wisconsin non-profit corporation also dedicated to

protecting Waukesha County’s natural resources, filed

App.1l_ -

the present lawsuit. They alleged that the DOT, FHWA

and WisDOT’s final approval of the Highway 164

Project and the Army Corps’ issuance of a Clean Water

Act § 404 permit violates the APA, 5 U.S.C. § 500 et

seq., the CWA, 33 U.S.C. § 1344, the FAHA, 23 U.S.C. §

101 et seq. and NEPA, 42 U.S.C. § 4321 et seq.!°

In March 2005, the plaintiffs filed a motion for a

temporary restraining order (“TRO”) and a preliminary

injunction, requesting that the court enjoin the

defendants from “proceeding with any further property

, © The plaintiffs’ complaint contains eight counts. Counts I-V

allege violation of the APA and NEPA stemming from the

defendants’ failure to prepare an Environment Impact

Statement that discusses in sufficient detail the environméntal

effects of the Highway 164 Project: the defendants’ reliance on

unreliable and inaccurate data with regard to the project's

impact on area wetlands; the defendants’ failure to consider

reasonable alternatives to expanding Highway 164, namely the

improvement of the existing two-lane highway: the defendants’

failure to respond adequately to public comments: and the

defendants’ failure to prepare a Supplemental Environmental

Impact Statement when new information, indicating that the

expansion of the highway would have a significantly greater

impact on the surrounding environment than previously

believed, became available. Counts VI and VII allege violation

of the FAHA and its implementing regulations because the

defendants did not fully consider the adverse effects of air

pollution prior to approving the new highway prceject; adopt

appropriate measures to minimize those hazardous effects: or

hold hearings at which the public could “hear and be heard.”

R.1 at 31. Count VIII alleges that the Army Corps of Engineers

violated the CWA in granting other defendants a § 404 permit,

allowing the WisDOT and FHWA to fill in approximately nine

acres of wetlands in connection with the project: the plaintiffs

claim that there exist practicable alternatives to destroying the

wetlands, which would have a less destructive impact on the

environment.

App. 12

acquisition, demolition, grading, construction or any

other physical work on the highway 164 expansion

project north of Swan Road in Waukesha County.” R.8

at 2-3.

On March 21, 2005, the district court'! denied the

plaintiffs’ request for a TRO. It held that the plaintiffs

had not proven that they would suffer “irreparable

injury before [their] adversary [could] be heard.” R.13

at 2. According to the court, construction on Phase II of

the project was not scheduled to begin until April 2005,

and the defendants could be heard within that time

frame. The court directed expedited proceedings on the

plaintiffs’ motion for a preliminary injunction.

On April 27, 2005, the district court denied the

plaintiffs’ motion for a preliminary injunction. See

R.46. It held that the plaintiffs had not established a

“reasonable likelihood of success on the merits of [their]

claims.” /d. at 11. In pertinent part, the court held that

the plaintiffs’ current challenges to the Highway 164

Project were barred by claim preclusion because

Citizens I: (a) culminated in a final decision on the

merits, see id. at 13 n.14; (b) involved the same parties

as the present action, or their privies, see id. at 14-16;

and (c) involved the same cause of action as the present

litigation, see id. at 17-24. Concerning the last element,

the court held that Citizens J, although focused on the

Ackerville Bridge Project and the alleged errors in the

EA prepared for that project, also challenged the EIS

prepared for the widening of Highway 164, the same

1! This order was issued by the district judge initially assigned

to the case. Subsequently, this judge recused himself and the

case was reassigned.

App. 13

document that forms the basis of the plaintiffs’ present

claims. Specifically:

[The] plaintiffs argue that they did not challenge

the March 6, 2002 ROD in Citizens J... .

However, although Citizens never mentioned

the March 6, 2002 ROD in Citizens J, it is clear

that it challenged that decision in that case

when it argued that the County J/Highway 164

project was improperly segmented from the

Ackerville Bridge project. A claim that one

project was improperly segmented from another

is necessarily a claim that the environmental

review conducted for each project was

inadequate because each review failed to

consider the environmental effects of the other

project.

Id. at 19-20 (emphasis in original).

In addition, the court held that the relief requested

by the plaintiffs in Citizens J demonstrated that there

was an identity between the cause of action in that

litigation and the cause of action in the present suit.

See id. at 20 (“Indeed, Citizens must have recognized

that success on their segmentation claim in Citizens J

entailed the invalidation of the ROD which approved

the County J/Highway 164 project because, in that

case, Citizens sought to enjoin the County J/Highway

164 project and compel FHWA and WisDOT to prepare

an EIS governing both projects.”). The court concluded

that, although the legal theories relied upon by the

plaintiffs in the present litigation are not the same as

those relied upon in Citizens J, there exists an identity

of issues between them because both cases arise from

the “same transaction” and involve “the same, or nearly

App. 14

the samel,] factual allegations.” /d. at 22 (internal

quotation marks omitted).

The plaintiffs timely filed a notice of appeal, as well

as a motion for an injunction pending appeal. See Fed.

R.Civ. P. 62(c). The district court denied this motion,

determining that, because the plaintiffs had not

demonstrated a likelihood of prevailing on the merits of

their claims, an injunction pending appeal was not

warranted. See R.61.

DISCUSSION

We review de novo a district court’s denial of a

motion for a preliminary injunction on res judicata

grounds.!? Under the doctrine of res judicata, “a final

judgment on the merits of an action precludes the

parties or their privies from relitigating issues that

were or could have been raised in that action.” A/d/en v.

McCurry, 449 U.S. 90, 94 (1980). “The three

requirements for res judicata under federal law are: (1)

an identity of the parties or their privies: (2) an

identity of the causes of actions: and (3) a final

judgment on the merits.” Cent. States, SE. & S.W.

Areas Pension Fund v. Hunt Truck Lines, Inc., 296

F.3d 624, 628 (7th Cir. 2002). If these requirements are

fulfilled, res judicata “bars not only those issues which

were actually decided in a prior suit, but also all issues

12 See Matter of L & S Indus., Inc., 989 F.2d 929, 932 (7th Cir.

1993) (holding that, although factual determinations made in

the course of evaluating a motion for a preliminary injunction

are reviewed for clear error, “legal conclusions are subject to de

novo review’).

App. 15

which could have been raised in that action.”

Brzostowski v. Laidlaw Waste Sys., Inc., 49 F.3d 337,

338 (7 Cir. 1995). “Simply put, the doctrine of res

Judicata provides that, when a final judgment has been

entered on the merits of a case, it is a finality as to the

claim or demand in controversy, concluding parties and

those in privity with them, not only as to every matter

which was offered and received to sustain or defeat the

claim or demand, but as to any other admissible matter

which might have been offered for that purpose.”

Nevada v.United States, 463 U.S. 110, 129-30 (1983)

(internal quotation marks omitted).

The plaintiffs do not contest that Citizens I resulted

a final judgment. Nor do they dispute that, although

WEAL was not a named plaintiff in the prior litigation,

WEAL and Citizens are in privity. However, they do

challenge whether the present cause of action is the

same as, or has an “identity” with, the cause of action

raised by Citizens in Citizens J. A claim has “identity

with a previously litigated matter if it emerges from

the same core of operative facts as that earlier action.”

Brzostowski, 49 F.3d at 338-39 (internal quotation

marks omitted). The district court, the plaintiffs

submit, mischaracterized their contentions in Citizens

/. According to the plaintiffs, the Citizens / litigation

focused exclusively on the lawfulness of the Ackerville

Bridge Project and simply did not “challenge the

Highway 164 Projectl].” See Reply Br. at 4-5 (citing the

numerous “differentiating facts between the projects”).

We agree with the plaintiffs that the Ackerville

Bridge and Highway 164 Projects are factually

App. 16

distinct.!3 See Citizens I, 349 F.3d at 962-63. We

nevertheless must conclude that Citizens J challenged

the validity of both projects and therefore the plaintiffs

cannot relitigate claims arising out of either project.

Specifically, in Citizens /, Citizens raised the following

contentions: (1) that the Finding of No Significant

Impact for the Ackerville Bridge Project failed to

account for the environmental impacts of the

contamination plumed; (2) that the defendants had

failed to consider “reasonably feasible alternatives to

the building of the proposed bridge,” Citizens I

Complaint, Supp. App. at 190; and (3) that the

Highway 164 and Ackerville Bridge Projects had been

segmented improperly. With regard to the last

contention, Citizens alleged that, by treating the

Ackerville Bridge Project as a separate endeavor, the

defendants were able to avoid “addressling] the

environmental issues raised by the presence of the

contaminate plume” in drafting the Highway 164 EIS.!4

13 Although unnecessary to our decision today, we note the post

hoc nature of the plaintiffs’ position. Throughout the Citizens I

proceedings, the plaintiffs maintained that the two projects

were, in fact, intricately interlinked. Indeed, it is this claim that

we addressed in Citizens’ prior appeal. See Highway J Citizens

Group v. Mineta, 349 F.3d 938, 962-63 (7th Cir. 2003) (holding

that the two projects had been properly segmented).

There is no need to address the implications of this

contradiction in Citizens’ position today. As we explain in the

text, although we agree with the plaintiffs that the projects are

independent, we nevertheless hold that the plaintiffs’ current

challenges to the Highway 164 Project should have been raised

in Citizens I.

14 The plaintiffs contend that these allegations are immaterial

because, in Citizens J, Citizens did not explicitly challenge the

Record of Decision (“ROD”) for the Highway 164 Project: rather,

(continued...)

App. 17

Td. at 193. As a result, Citizens continued, the Highway

164 EIS was incomplete and inaccurate. Notably, this

previous contention arose from the same document that

forms the factual basis of the plaintiffs’ current claims. |

In addition, the relief requested in the present action is

similar in substantial ways to the relief requested in

Citizens [—a consideration that our cases counsel

ought to be given significant weight in determining

whether there is an identity between the plaintiffs’

causes of action for res judicata purposes.'5 In Citizens

I, Citizens requested that the court “requirle] the

defendants to prepare a Final Environmental Impact

Study for all of the County J/Highway 164 project” and

“[plreliminarily and permanently enjoin[] the

defendants from widening County J/Highway 164.”

Citizens I Complaint, Supp. App. at 193-94. Similarly,

in this litigation, the plaintiffs request that the court

(...continued)

according to the plaintiffs, the references in the Crtzzens /

complaint to Highway 164 were limited to the EIS. A ROD,

however, marks the final approval of the recommendations

contained in an EIS. Because any error in the EIS thus becomes

an error in the ROD, the documents are inseparable for the

purpose of res judicata analysis.

15 See Anchor Glass Container v. Buschmeter, 426 F.3d 872,

878 (7th Cir. 2005) (holding that, because the “ultimate relief

sought in the two actions” is the same, “there is sufficient

identity of the causes of action [in the current and past

litigations] for res judicata to apply”); see also Friez v. First Am.

& Trust of Minot, 324 F.3d 580, 581 (8th Cir. 2003) (deeming

relevant to its res judicata analysis that the plaintiff “seeks

effectively the same relief (ERISA benefits) in both cases”):

United Tech. Corp. v. Chromalloy Gas Turbine Corp., 189 F.3d

1338, 1345 (Fed. Cir. 1999) (holding that the two suits involved

identical causes of action, in part because the “relief sought by

Chromalloy in both actions is intertwined”).

App. 18

“prohibit[] Defendants USDOT and FHWA from taking

any other action that in any way supports or funds the

design, property acquisition, construction or

development of the [Highway 164 expansion] project

until Defendants have remedied their violations of

NEPA, the APA, and federal highway law,” as well as

require the defendants to prepare a supplemental EIS

for the Highway 164 Project. R.1 at 35 (also requesting

that the FHWA vacate the original EIS and ROD for

the Highway 164 Project). Accordingly, we must

conclude that, in the course of arguing that the two

projects had been improperly segmented, Citizens

placed into dispute the validity of the environmental

assessment for the Highway 164 Project.

In our consideration of this matter, we note Citizens’

view that the mere mention of Highway 164 in the

complaint does not mean that Citizens necessarily

challenged the overall validity of the environmental

assessment of that project. They submit that, in

contending that the relevant agencies improperly

segmented the two projects, they focused primarily, or

even exclusively, on errors in_ assessing the

environmental effects of the Ackerville Bridge Project,

referencing Highway 164 only out of necessity. We

cannot accept this argument, however. Citizens’

attempt to minimize the significance it placed on the

Highway 164 Project in Citizens / is unavailing.

According to the plain text of the documents filed in

Citizens I, Citizens submitted that segmentation was

improper because it caused the Highway 164 EIS, not

the Ackerville Bridge EA, to be underinclusive and

therefore inaccurate. The thrust of Citizens’ submission

was that the improper segmentation permitted the

FHWA and WisDOT to prepare the Highway 164 EIS

without first examining oor _ accounting for

contamination issues near the Ackerville bridges. See

App. 19

Citizens I Complaint, Supp. App. at 193-94 (alleging

that the “reason that the defendants have segmented

the bridge project . . . is so that the EIS for the project

2748-01-01 [the Highway 164 Project] . . . would not

have to address the environmental issues raised by the

presence of the contaminate plume” and that, as a

result, a new “Final Environmental Impact Study for

all of the County J/Highway 164 project” is necessary).

It is clear from these documents that, in Citizens I,

Citizens challenged the procedures followed in

preparing the environmental analysis for the Highway

164 expansion and, thus, there is an identity between

the cause of action in Citizens J and the cause of action

~ in the present case.

To be sure, the plaintiffs in the present litigation do

not pursue the precise legal theories that we addressed

in Citizens I. In the prior litigation, Citizens’ only

argument with regard to the Highway 164 Project was

that the defendants’ failure to take into account the

environmental effects of the contamination plume near

the Ackerville bridges rendered the EIS on that project -

invalid. By contrast, in the present litigation, the

plaintiffs claim that the Highway 164 EJS is

inaccurate, fails to consider the cumulative

environmental effects of the construction or reasonable

alternatives to highway expansion, and suffers from

the lack of a meaningful opportunity for public

commentary. They also allege a violation of the FAHA

on the ground that the defendants failed to consider,

and attempt to remedy, hazardous air pollution

stemming from the proposed construction.

However, the question is not whether the legal issues

now presented were raised previously; rather, it is

whether these matters “could have been raised in [the

prior] action.” Brzostowski, 49 F.3d at 338 (emphasis

App. 20

added). To determine “whether the plaintiff could have

raised the [current] issuels] in the first suit,” we

employ a “same transaction” test. Doe v. Allied-Signal,

Inc., 985 F.2d 908, 913 (7th Cir. 1993). Under this test,

a cause of action consists of a single core of

operative facts giving rise to a remedy... . Once

a transaction has caused injury, all claims

arising from that transaction must be brought in

one suit or lost. A plaintiff may not avoid an

earlier judgment on the merits by merely

concocting a new legal theory.

Id. (internal citations and quotation marks omitted).

Here, although the legal elements of each claim may

be different, the underlying factual transaction is

identical: the preparation and finalization of the

Highway 164 EIS.!© As in Arzostowski, the resolution

of both of the plaintiffs’ complaints are grounded in the

adequacy of the environmental analysis for the

Highway 164 Project. See Brzostowski, 49 F.3d at 339

(“[Wle find that the two claims before us clearly arise

out of the same core of operative facts and are based on

16 We take no position on whether the plaintiffs CWA claim

against the Army Corps, who was not a party to the Citizens |

litigation, is also barred by res judicata. The district court

concluded that the plaintiffs had not demonstrated a reasonable

likelihood of success on their CWA claim, given that there is no

evidence that the Corps, in issuing to the WisDOT a § 404

permit, had failed to consider “practicable alternatives” to the

expansion of the highway or that the Corps understated the

wetlands impact of the project. R.46 at 24-32. The plaintiffs do

not challenge these conclusions on appeal. Therefore, this

appeal does not implicate the Supreme Court’s recent decision

in Rapanos v. United States, 126 S. Ct. 2208 (2006).

App. 21

the same factual allegations. While the legal elements

of each claim may be different, the central factual

issues are identical.”). Notably, Citizens has not argued

that they were not ad/e to bring their present claims in

the earlier litigation. Nor could such an argument have

been made. All transactions forming the basis of the

plaintiffs’ causes of action, including the final approval

of the Highway 164 EIS by the FHWA and DOT, had

occurred by the time Citizens J was filed on July 3,

2002: The Highway 164 EIS was drafted and disclosed

to the public in April 2001; the ROD for the project was

issued on March 6, 2002.

In sum, because the plaintiffs challenged the

approval of the Highway 164 Project in Citizens J,

because the current claims stem from the same factual

transaction as the legal claims addressed in that prior

litigation and because the plaintiffs had a fair

opportunity to raise their claims previously, we must

conclude that res judicata bars the plaintiffs from

further pursuing their challenges to the Highway 164

Project. As the Supreme Court noted emphatically in

Baldwin v. Iowa State Traveling Men’s Ass’n, 283 U.S.

522, 525 (1931), “[plublic policy dictates that there be

an end of litigation; that those who have contested an

issue shall be bound by the result of the contest; and

that matters once tried shall be considered settled as

between the parties.”

App. 22

Conclusion

For the foregoing reasons, we affirm the judgment of

the district court. ‘

AFFIRMED

A true Copy:

Teste:

= of the United States Court of

Appeals for the Seventh Circuit

USCA-02-C-0072—8-2-06

App. 23

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF WISCONSIN

HIGHWAY J CITIZENS GROUP, U.A.

and WAUKESHA COUNTY

ENVIRONMENTAL ACTION LEAGUE

Plaintiffs,

v. | Case No. 05-C-0212

UNITED STATES DEPARTMENT OF

TRANSPORTATION: Secretary of

Transportation NORMAN MINETA;

FEDERAL HIGHWAY ADMINISTRATION;

Administrator of Federal Highway

Administration MARY PETERS; U.S. ARMY

CORPS OF ENGINEERS; District Engineer

MICHAEL F. PFENNING; and FRANK

BUSALACCHI, in his official capacity as

Secretary of the State of Wisconsin

Department of Transportation

Defendants.

DECISION AND ORDER

Plaintiffs Highway J Citizens Group, U.A.

(“Citizens”)! and Waukesha County Environmental

1 Citizens is an unincorporated association that

“represents residents of Waukesha and Washington County

who are concerned about

(continued...)

App. 24

Action League (“WEAL”)? filed this action alleging that

federal governmental approval of a proposed highway

project (“the County J/Highway 164 project”) violates

federal law. Specifically, pursuant to the

Administrative Procedure Act (“APA”), 5 U.S.C. §§

701-06, plaintiffs challenge: (1) the March 6, 2002

Record of Decision (“ROD”) of the Federal Highway

Administration (“FHWA”), which authorized the use of

federal funds under the Federal Aid Highway Act, as

amended by the Transportation Equity Act for the 21+

Century, 23 U.S.C. § 101 et seq, in connection with the

improvement and expansion of County J/Highway 164

between Interstate 94 and Highway 60 in Waukesha

and Washington Counties; and (2) the January 14,

2005 decision of the United States Army Corps of

Engineers (“ACOE”) to issue a permit under § 404 of

(...continued)

the potential destruction of the region along STH 164 and CTH

J with a WisDOT proposed 4-lane highway.” (Compl. § 10.)

According to the complaint, “[t]here are approximately 8,000

members of Citizens, many of whom live along, and enjoy State

Highway 164 in its present state.” (Id.)

2 WEAL is a nonprofit corporation “which has been

dedicated since 1978 to protecting Waukesha County’s natural

resources.” (Compl. § 11.) WEAL has approximately 100

members, “the overwhelming majority of whom are residents of

Waukesha County, including members who live along, and

enjoy Highway 164 in its present state.” (Id.)

3 To assist the reader, I have attached an appendix of

the acronyms used in this decision.

4 The roadway expansion project is Wisconsin

Department of Transportation (“WisDOT”) Project 1.D. 2748-01-

01.

App. 25

the Clean Water Act (“CWA”), 33 U.S.C. § 1344,

allowing WisDOT to fill 9.27 acres of wetlands in

connection with the County J/Highway 164 project.

Plaintiffs challenge the March 6, 2002 ROD on the

ground that in reaching its decision the FHWA violated

the National Environmental Policy Act of 1969

(“NEPA”), 42 U.S.C. §§ 4321 - 4347, and the Federal

Aid Highway Act, and they allege that the ACOE’s

decision to issue a § 404 permit violated the CWA.

On March 17, 2005, plaintiffs moved for a

temporary restraining order (“TRO”) and a preliminary

injunction and sought to prevent defendants from

beginning construction on a particular phase of the

roadway project, which was scheduled to begin in April.

On March 21, 2005, the judge initially assigned to the

case denied plaintiffs’ motion for a TRO and ordered

defendants to respond to plaintiffs’ motion for a

preliminary injunction on an_ expedited basis.

Subsequently, the judge recused himself, and the clerk

of court randomly reassigned the case to me. This

decision and order addresses plaintiffs’ motion for

preliminary injunction.

I. STATUTORY OVERVIEW

The present case involves provisions of three

federal statutes, NEPA, the Federal Aid Highway Act

5 The permit in dispute is permit number MVP-2004-

157290-DJP.

6 Additionally, the complaint contains passing

references to the Wisconsin Environmental Policy Act

(“WEPA”), Wis. Stat. § 1.11. However, none of the eight counts

of the complaint alleges a WEPA violation, and plaintiffs

indicate that they are not presently pursuing a WEPA claim.

App. 26

and the CWA. Before turning to the facts of the case, I

will outline the relevant provisions of these statutes.

A. NEPA

NEPA establishes a “national policy [to]

encourage productive and enjoyable harmony between

man and his environment,’ and was intended to reduce

or eliminate environmental damage and to promote

‘the understanding of the ecological systems and

natural resources important to’ the Untied States.”

Dep’t of Transp. v. Pub. Citizen, 124 S. Ct. 2204, 2209

(2004) (quoting 42 U.S.C. § 4321) (alteration in

original). NEPA does not mandate particular results in

order to accomplish these ends but instead imposes

procedural requirements on federal agencies, which

compel them to “undertake analyses of the

environmental impact of their proposals and actions.”

Id. In this regard, NEPA’s core provision is its

requirement that federal agencies:

include in every recommendation or report on

proposals for legislation and other major Federal

actions significantly affecting the quality of the

human environment, a detailed statement by

the responsible official on--(i) the environmental

impact of the proposed action, (ii) any adverse

environmental effects which cannot be avoided

should the proposal be implemented, (iii)

alternatives to the proposed action, (iv) the

relationship between local short-term uses of

man's environment and the maintenance and

enhancement of long-term productivity, and (v)

any irreversible and irretrievable commitments

of resources which would be involved in the

proposed action should it be implemented.

App. 27

42 U.S.C. § 4332(2)(C). The regulations interpreting

NEPA call this detailed statement an Environmental

Impact Statement (“EIS”). See 40 C.F.R. § 1508.11.7 An °

EIS is prepared in two stages. First, the agency

prepares a draft EIS and receives comments on it from

federal and other government agencies and the general

public. See id. §§ 1502.9(a) & 1503.1. Then, the agency

prepares a final EIS (“FEIS”) in which it responds to

comments and discusses “any responsible opposing

view which was not adequately discussed in the draft

statement.” Id. § 1502.9(b). Under certain

circumstances, the agency may also be required to

prepare a supplement to either its draft or final EIS.

See id. § 1502.9(c).

Requiring an agency to prepare an EIS for all

“major Federal actions significantly affecting the

quality of the human environment,” 42 U.S.C. §

4332(2(C), serves two purposes. First, “lilt ensures

that the agency, in reaching its decision, will have

available, and will carefully consider, detailed

information concerning significant environmental

impacts.” Public Citizen, 124 S. Ct. at 2215 (quoting

Robertson v. Methow Valley Citizens Council, 490 U.S.

332, 349 (1989)) (alteration in original). Second, “it

‘suarantees that the relevant information will be made

available to the larger audience that may also play a

role in both the decisionmaking process and the

implementation of that decision.” Id. at 2215-18. Thus,

in an EJS discussing a federal agency’s proposal, the

agency must “articulate why [it has] settled upon a

NEPA established the Council of Environmental

Quality (“CEQ”) and provided it with authority to issue

regulations interpreting NEPA. These regulations are codified

at 40 C.F.R. §§ 1500 et seq.

App. 28

particular plan and what environmental harms (or

benefits) [its] choice entails.” Simmons v. U.S. Army

Corp of Eng’rs, 120 F.3d 664, 666 (7th Cir. 1997). The

EIS must show that agency officials have “[thought]

through the consequences of — and alternatives to —

their contemplated acts,” and must ensure that

“citizens get a chance to hear and consider the

rationales the officials offer.” Id.

When an agency makes a decision after

preparing and studying an EIS, the agency must

memorialize that decision in a ROD. See 40 C.F.R. §

1505.2.

B. Federal Aid Highway Act

The Federal Aid Highway Act allows state

governments to use federal funds in carrying out

highway construction projects. See, e.g., Rothrock v.

United States, 62 F.3d 196, 198 (7th Cir. 1995) (citing

23 U.S.C. §§ 101(b), 105(a) and 106(a)) . The Act

imposes a number of procedural requirements upon

projects that receive federal funding. The requirement

involved in the present case provides that when a

state’s proposed highway project “involvles] the

bypassing of, or going through, any city, town, or

village,” the state must certify to the Secretary of

Transportation that “it has had public hearings, or has

afforded the opportunity for such hearings.” 23 U.S.C. §

128(a). The purpose of this public hearing requirement

is “to bring the planners face-to-face with public

reaction to their proposals and projects.” Coalition of

Concerned Citizens Against 1-670 v. Damian, 608 F.

Supp. 110, 125 (S.D. Ohio 1984).

App. 29

C. Clean Water Act

The purpose of the CWA is “to restore and

maintain the chemical, physical, and _ biological

integrity of the nation’s waters.” S. Fla. Water Mgmt.

Dist. v. Miccosukee Tribe of Indians, 541 U.S. 95, 102

(2004) (quoting 33 U.S.C. § 1251). To serve this

purpose, the CWA “prohibits ‘the discharge of any

pollutant by any person’ unless done in compliance

with some provision of the Act.” Id. (quoting 33 U.S.C. §

1311(a)). The provision of the CWA at issue in this case

is § 404, which requires an applicant to obtain a permit

from the ACOE for the discharge of dredged or fill

material into navigable waters of the United States,

which include wetlands. 33 U.S.C. § 1344 (codification

of § 404); 40 C.F.R. § 230.3(s)(7) (defining “waters of the

United States” to include wetlands); Town of Norfolk v.

U.S. Army Corps of Eng’rs, 968 F.2d 1438, 1445 (1st

Cir. 1992). Guidelines developed by the Environmental

Protection Agency in conjunction with the ACOE

govern the issuance of a § 404 permit. 33 U.S.C. §

1344(b)(1); Greater Yellowstone Coalition v. Flowers,

359 F.3d 1257, 1269 (10th Cir. 2004). These guidelines,

known as § 404(b)(1) guidelines, are published in 40

C.F.R. Part 230. See Holy Cross Wilderness Fund v.

Madigan, 960 F.2d 1515, 1524-25 (10th Cir. 1992). The

ACOE also has its own regulations that apply to the

permit process, which are published in 33 C.F.R. Part

320. See Town of Norfolk, 968 F.2d at 1445. The §

404(b)(1) guideline relevant to the present case is 40

C.F.R. § 230.10(a), which provides that “no discharge of

dredged or fill material shall be permitted if there is a

practicable alternative to the proposed discharge which

would have less adverse impact on the aquatic

ecosystem, so long as the alternative does not have

App. 30

other significant adverse environmental

consequences.”8

Ill. FACTS

In 1999, the FHWA and WisDOT began

studying proposals to address existing and future

transportation demand along the County J/Highway

164 roadway. They studied an area starting just north

of I-94 on County J, running north along County J and

Highway 164, and ending just north of where Highway

164 crosses County E. (See FEIS Ex. 2-9.)9 Defendants

state that they wish to improve the roadway to:

* Improve safety by reducing conflicts between

through and local traffic and providing a facility

that meets current design standards for a

principal arterial highway.

- Provide a recommended plan that can be used

by local governments as blueprint to guide

future land use and development decisions, and

to preserve land for future transportation

improvements.

8 Thus, unlike NEPA, which does not mandate that an

agency make any particular décision so long as it prepares an

adequate EIS, the CWA and applicable regulations create

substantive restrictions governing when the ACOE can issue a

§ 404 permit. See Greater Yellowstone Coalition, 359 F.3d at

1273-74; Sierra Club v. United States Army Corps of Eng’rs,

772 F.2d 1043, 1051 (2d Cir. 1985).

9 The record includes portions of the FEIS. (See Exhibit

A to March 18, 2005 Affidavit of Jeffrey M. Gonyo, and

Defendants’ Exhibits 1009 to 1019.)

App. 31

* Improve local and through traffic access to

development and community services adjacent

to County J/WIS 164 as well as to destinations

outside the corridor.

- Improve operational efficiency commensurate

with the highway’s function as a principal

arterial and primary north-south route in

northern Waukesha County and _ southern

Washington County.

* Accommodate traffic demand generated by

existing and planned development along the

County J/WIS 164 corridor as well as in the

surrounding region.

(Id. at 1-2 to 1-3.) The FHWA and WisDOT decided to

proceed with a proposal that involved expanding the

County J/Highway 164 roadway from two to four lanes

throughout the entire project area.!° However, because

the proposal was a “major Federal actionl] significantly

affecting the quality of the human environment,” 42

U.S.C. § 4332(2)(C), NEPA required the FHWA to

prepare an EIS before approving the proposal. On April

9, 2001, FHWA and WisDOT prepared a draft EIS. The

draft EIS listed the ACOE as a “cooperating agency.”

(See Defs.’ Ex. 1003 at 1.) On May 30, 2001, WisDOT

held what it considered a public hearing under 28

U.S.C. § 128(a), and on December 11, 2001, the FHWA

and WisDOT issued a final EIS, again listing ACOE as

a cooperating agency. The FEIS recommended the

roadway expansion proposal, and the FHWA issued a

ROD on March 6, 2002 in which it adopted that

10 The proposal involves improvements to the roadway

other than expansion to four lanes, but the details are

unimportant.

App. 32

proposal. The agencies have commenced construction of

the County J/Highway 164 project and completed the

first phase in 2004. They began the second phase in

April 2005, shortly after plaintiffs commenced the

present action, and propose to commence a third phase

in 2006. They have not scheduled construction in a

large section of the project area that they are

preserving for expansion to four lanes in the future,

when the average daily traffic increases to the point

where expansion to four lanes becomes necessary.!!

The second phase of the project involves

expanding a 3.8 mile segment of Highway 164 between

Swan Road and Prospect Court to four lanes. (See

Defs.’ Ex. 1039.) Because WisDOT needed to fill

wetlands considered “waters of the United States” as

part of this phase, it applied to the ACOE for a permit

pursuant to § 404 of the CWA. Upon receipt of

WisDOT’s application, the ACOE determined that the

application failed to account for certain wetlands in the

project area and asked WisDOT to account for these

additional wetlands and supplement its application.

WisDOT complied with the ACOEK’s request, and on

December 30, 2004, the ACOE issued a decision in

which it recommended that WisDOT’s permit

application be granted. On January 14, 2005, the

average daily traffic “ADT”) exceeds 13,000. ACOE

issued a permit authorizing WisDOT to fill 9.27 acres

of wetlands as part of the second phase of the roadway

expansion project.

1! Under WisDOT standards, a roadway must be

expanded to four lanes when the average daily traffic (“ADT”)

exceeds 13,000.

App. 33

Additional facts will be stated in the course of

this decision.

Ill. STANDARDS OF REVIEW

Plaintiffs seek review of two final agency

actions: the FHWA’s March 6, 2002 ROD, and the

ACOE’s issuance of a § 404 permit to WisDOT on

January 14, 2005. The APA provides the standard of

review for plaintiffs’ challenges to these decisions. See

Highway J Citizens Group v. Mineta, 349 F.3d 938, 952

(7th Cir. 2003) (reviewing NEPA claim pursuant to

APA); Greater Yellowstone Coalition, 359 F.3d at 1268

(stating that Corp’s compliance with CWA is reviewed

pursuant to APA); Coalition of Concerned Citizens

Against I-670, 608 F. Supp. at 121-26 (applying APA in

reviewing public hearing claim under Federal Aid

Highway Act). Under the APA, a court may set aside

an agency action only if it is “arbitrary, capricious, an

abuse of discretion, or otherwise not in accordance with

the law.” 5 U.S.C. § 706(2)(A). This standard of review

is narrow and requires that I “consider whether the

decision was based on a consideration of the relevant

factors and whether there has been a clear error in

judgment.” Highway J Citizens Group, 349 F. 3d at

952-53 (internal quotation marks and citation omitted).

Thus, if

an agency has relied on factors which Congress

has not intended it to consider, entirely failed to

consider an important aspect of the problem,

offered an explanation for its decision that runs

counter to the evidence before the agency or is so

implausible that it could not be ascribed to a

difference in view or the product of agency

expertisel|,]

App. 34

the agency action must be set aside. Motor Vehicle

Mfrs. Ass’n of U.S., Inc. v. State Farm Mut. Auto. Ins.

Co., 463 U.S. 29, 43 (1983). With respect to plaintiffs’

NEPA claims, I may not substitute my judgment

regarding the environmental consequences of an action

for that of the agency. Highway J Citizens Group, 349

_ F.3d at 953. However, I must “insure that the agency

has taken a ‘hard look’ at environmental

consequences.” Kleppe v. Sierra Club, 427 U.S. 390,

410 n.21 (1976). In a suit under the APA, a district

court sits as a reviewing court, much like an appellate

court. Cronin v. U.S. Dep’t of Agric., 919 F.2d 439, 443-

44 (7th Cir. 1990). With few exceptions not relevant

here, the court does not take new evidence or hold a

trial or evidentiary hearing. Id. Instead, in reviewing

the agency action, the court considers only matters

within the administrative record. 5 U.S.C. § 706; Fla.

Power & Light Co. v. Lorion, 470 U.S. 729, 743-44

(1985). Because in reviewing plaintiffs’ claims I am

performing what is essentially an appellate role, a

discussion of the proper treatment of plaintiffs motion

for preliminary injunction is necessary. As the Seventh

Circuit has stated, “the ultimate question to be decided

when a plaintiff moves for a preliminary injunction is

whether granting, or denying, the motion is the

decision that will minimize the costs of error arising

from the fact that the motion must be decided without

a full hearing on the merits of the plaintiffs claim.”

Cronin, 919 F.2d at 444-45. Thus, entertaining a

request for a preliminary injunction “assumes that the

decision whether to grant or deny [the request] is

preliminary to a full hearing on the plaintiffs claim.”

Id. at 445. But in typical APA cases, there will never be

a hearing at all: thus, “considerations of irreparable

harm are out the window and the only question is

whether the plaintiff is entitled to an injunction,

period.” Id. In such cases, “[a]ll that the plaintiffs are

App. 35

entitled to do in the courts is try to persuade the

district judge and then [the court of appeals], on the

basis of ewidence that was before [the administrative

agency at the time of its decision], that the decision is

unlawful.” Id. However, the Seventh Circuit has

recognized that a district court may entertain a

preliminary injunction motion in APA cases under

certain circumstances. Id. at 446-47. One such

circumstance is when the administrative record is

incomplete when the motion is filed and irreparable

harm will occur before the record is completed. Id. at

446.

In the present case, because I am limited to

reviewing the administrative record, most likely I will

never hold a hearing on the merits of plaintiffs’ claims.

However, the full administrative record has not been

filed with the court as of the date of this decision, and I

do not know whether plaintiffs have been able to

review the full record and, if not, whether they intend

to make additional arguments after they do so.

Further, as discussed in more detail below, defendants

have raised the affirmative defense of claim preclusion

with respect to plaintiffs’ challenge to the March 6,

2002 ROD under the APA, NEPA and Federal Aid

Highway Act. In order to resolve the issue of claim

preclusion, I must consider facts that are not part of

the administrative record. If such facts are disputed, I

may need to hold a hearing to resolve the dispute.'”

Accordingly, although motions for preliminary

injunctions are usually inappropriate in APA cases, |

12 However, as explained below, plaintiffs do not appear

to dispute any of the facts relating to defendants’ claim

preclusion defense. Thus, it is unlikely that I will need to hold a

hearing on the issue.

App. 36

conclude that the procedural posture of this case

warrants such a motion.

Generally, the standard governing a motion for a

preliminary injunction is as follows. The party seeking

a preliminary injunction has the burden of

demonstrating that it has a reasonable likelihood of

success on the merits of its claims, that it has no

adequate remedy at law, and that it will suffer

irreparable harm without the preliminary injunction.

See, e.g., AM Gen. Corp. v. DaimlerChrysler Corp., 311

F.3d 796, 803 (7th Cir. 2002). If the party seeking the

injunction meets those burdens, the court then

considers any irreparable harm that the injunction

might impose” upon the party against which the

injunction is sought, and whether the preliminary

injunctien would harm of foster the public interest. Id.

at 803-04. However, “[a] party with no chance of

success on the merits cannot attain a preliminary

injunction.” Id. at 804.

IV. ANALYSIS

Plaintiffs challenge the FHWA’s March 6, 2002

ROD on two grounds. First, they argue that the FHWA

issued the ROD in violation of NEPA because the EIS

prepared for the County J/Highway 164 project

contained an inadequate discussion of the project’s

environmental impacts. Second, they argue that the

FHWA issued the ROD in violation of § 128 of the

Federal Aid Highway Act because it failed to hold a

proper public hearing on the project. Plaintiffs also

challenge the ACOE’s decision to issue a § 404 permit

in connection with the second phase of the project on

the ground that the decision violated 40 C.F.R. §

230.10(a)’s prohibition on issuing a § 404 permit when

there exists a “practicable alternative” to the proposed

App. 37

project that would have “less adverse impact on the

aquatic ecosystem.”

As noted, besides resisting plaintiffs’ claims on

their merits, defendants argue that plaintiffs’ challenge

to the March 6, 2002 ROD is barred by claim

preclusion. Thus, I consider first whether plaintiffs’

challenge to the March 6, 2002 ROD is barred by claim

preclusion. Because, as explained in Part A below I

conclude that it is, I do not discuss the merits of such

challenge. I discuss plaintiffs’ challenge to the ACOE’s

decision to issue a § 404 permit, the only remaining

issue, in Part B below.

A. Claim Preclusion

Generally, claim preclusion, also known as res

judicata, bars a party from raising a claim that it

raised or could have raised in previous litigation. See

Nevada v. United States, 463 U.S. 110, 129-30 (1983).

To show that a claim is barred by federal claim

preclusion,'? the party seeking to establish the defense

must establish three elements: identity of claims,

identity of parties or their privies, and a prior final

judgment on the merits. See Perry v. Globe Auto

Recycling, Inc., 227 F.3d 950, 952 (7th Cir. 2000); D &

K Props. Crystal Lake v. Mut. Life Ins. Co. of N.Y., 112

F.3d 257, 259 (7th Cir. 1997). If the party establishes

these elements, “claim preclusion bars not only those

13° The preclusive effect of a judgment rendered by a

federal court depends on federal law. See, e.g., In the Matter of

Bridgestone/Firestone, Inc., Tires Prods. Liab. Litig., 333 F.3d

763, 767 (7th Cir. 2003) (“Bridgestone Tires”). Because the

judgment at issue in the present case is a federal court

judgment, I apply federal rather than state claim preclusion

principles.

App. 38

issues which were actually decided in a prior suit, but

also all issues which could have been raised in that

action.” Kratville v. Runyon, 90 F.3d 195, 197-98 (7th

Cir. 1996). In the present case, defendants claim that

claim preclusion bars plaintiffs’ claim that the March 6,

2002 ROD should be set aside because plaintiff Citizens

(with whom, argue defendants, WEAL is in privity)

challenged the same ROD in a previous case, Highway

J Citizens Group U.A. v. Mineta et al., Case No. 02-C-

0662 (E.D. Wis.) (“Citizens I”), which resulted in a

judgment on the merits. I consider this argument

below.!4

1. Identity of Parties or Their Privies

The first element of claim preclusion is the

identity of the parties or their privies in the two suits.

In the context of claim preclusion, “privity” is difficult

to define. It is essentially “a descriptive term for

designating those with a sufficiently close identity of

interests” such that applying claim preclusion to bar a

party’s claim is proper. Tice v. Am. Airlines, Inc., 162

F.3d 966, 971 (7th Cir. 1998). Privity is a fact-specific

question: “whether there was (or should be implied at

law) the kind of link between the earlier and later

plaintiffs that justifies binding the second [plaintiff] to

the result reached against the first.” Id.

In the present case, there is no question that

plaintiff Citizens and all of the relevant defendants

were parties, or were in privity with, parties to Citizens

‘4 Because the parties do not dispute that Citizens I

resulted in a judgment on the merits, | discuss only whether

Citizens I and the present case involve the same parties and the

same claims.

App. 39

I. However, plaintiff WEAL was not a party to

Citizens I, and at oral argument on the present motion,

I raised the question of whether WEAL was in privity

with Citizens.'® Defendants responded by arguing that

WEAL was “virtually represented” by Citizens in

Citizens I. (See Defs.’ Supp. Br. [R. 28] at 17.) “Under

the doctrine of virtual representation, a person may be

bound by a judgment even though not a party if one of

the parties to the suit is so closely aligned with his

interests as to be his virtual representative.” In re L &

S Indus., 989 F.2d 929, 933 (7** Cir. 1993). The Seventh

Circuit views the doctrine of virtual representation not

as a form of privity, but as a separate theory for

applying claim preclusion to a party who was not a

party to the relevant previous litigation. See Tice, 162

F.3d at 971. Viewed as a doctrine distinct from privity,

the Seventh Circuit has disapproved of virtual

representation. See Bridgestone Tires, 333 F.3d at 769;

Perry, 227 F.3d at 953; Tice, 162 F.3d at 970-74.

However, the Seventh Circuit has stated that the

15 Although the ACOE was not a party to Citizens I, the

ACOE is a defendant in this case only in connection with its

decision to issue a § 404 permit. Defendants do not argue that

claim preclusion bars plaintiffs challenge to the ACOF’s

decision to issue the permit. Thus, that the ACOE was not a

party to Citizens I does not prevent claim preclusion from

barring plaintiffs’ challenge to the March 6, 2002 ROD.

Further, successors to public office are considered to be

in privity with their predecessors. See, e.g., 18 James Wm.

Moore et al., Moore’s Federal Practice § 131.40[3}le] (3d ed.

2005). Thus, the fact that some of the named state officials in

the present suit are successors in office does not prevent a

finding that the parties are identical.

16 As far as | can tell, plaintiffs do not dispute that they

were in privity. However, because I raised this issue at oral

argument, I will address it here.

App. 40

doctrine is not “lifeless,” Monfils v. Taylor, 165 F.3d

511, 521 (7th Cir. 1998), and applies its principles

within the context of privity, Tice, 162 F.3d at 971. As

the court stated in Tice, “la] proper functional analysis

of privity, focusing on the general question whether the

earlier parties were in some sense proper agents for the

later parties, [supports] preclusion in the cases that

have used the lingo of virtual representation.” Id.

Thus, to determine whether WEAL and Citizens

were in privity, | must determine whether Citizens was

in some sense a proper agent for WEAL in Citizens I.

Whether preclusion is appropriate “depend[s}] on how

closely the two [parties’] sets of interests coincide and

the role the absentees played in the earlier litigation.”

Id. at 973. “At a minimum ... the claims and defenses

of the two allegedly equivalent parties (earlier litigant,

present litigant) must be the same.” Id. Further, “there

should be some indication not only that the second

party was aware that the first litigation was going on

and that the earlier litigation would resolve its claims,

but also that the second party either had participated

or had a legal duty to participate.” Id.

Applying the above principles to the present

case, I conclude that defendants have shown that

WEAL was in privity with Citizens. First, as explained

infra Part IV.A.2, the claims of Citizens in Citizens I

and of WEAL and Citizens in the present case are

identical. Second, Citizens and WEAL have identical

interests in the suit, and had identical interests in

Citizens |. That is, both are citizens groups opposed to

the County J/Highway 164 project. See supra n.1 & n.2.

Indeed, the complaint in the present case does not

distinguish between the two groups when describing

the interests of its members. (See Compl. §412-15.)

Finally, there is more than “some indication” that

App. 41

WEAL was aware that Citizens I was going on and that

WEAL had participated in that case. WEAL’s website

contains a letter from Jeff Gonyo, a member of

Citizens, describing the present lawsuit and soliciting ~

donations from WEAL members to pay legal fees in

connection with the suit. This letter demonstrates that

WEAL and WEAL members knew of, and participated

in, Citizens I. It states:

For the past six years, WEAL has been a very

strong supporter of our citizens’s groups’s li.e.,

Citizens’s] grassroots efforts to stop the

Highway 164 four-lane expansion and their [i.e.,

WEAL’s] Board of Directors has made many

generous donations to help pay for our group’s

past legal fees. By joining our citizens group as a

co-plaintiff in this current lawsuit, WEAL is

promising to make a $1,000 donation to help out

with our legal fees once again. We are very

appreciative of WEAL’s continuing support of

our efforts.

(Defs.’ Ex. 1043 at 4 (emphasis in original).) The letter

concludes by “strongly encouraging” Citizens members

to becom» members of WEAL. (Id.) Although this letter

never specifically mentions Citizens I, the context of

the letter makes clear that WEAL knew about,

supported, and contributed to Citizens’s legal expenses

in Citizens I. At the least, that is what defendants have

represented this letter as stating, and plaintiffs have

not disputed such representation. Thus, because

WEAL’s and Citizens’s interests are identical, and

because WEAL knew about and participated in

App. 42

Citizens I, I find that WEAL was in privity with

Citizens.!7

2. Identity of Claims

Defendants argue that in Citizens I, Citizens

sought to set aside the March 6, 2002 ROD under the

APA and that plaintiffs’ current challenge to the same

ROD under the APA is part of the same claim as the

prior challenge. To evaluate defendants’ argument, I

must determine whether Citizens challenged the

March 6, 2002 ROD in Citizens I and, if I determine

that it did, determine whether plaintiffs’ current

challenge to the ROD is part of the “same claim.”

a. Whether Citizens Challenged March 6, 2002 ROD in

Citizens I

Predominantly, Citizens I involved a challenge

under the APA to a WisDOT/FHWA project known as

the “Ackerville Bridge project.”!* This project, which

17 Whether WEAL and Citizens were in privity is a

question of fact, see Tice, 162 F.3d at 971 (stating that privity is

a “fact-specific” question), on which defendants bear the burden

of proof, see, e.g., ITOFCA, Inc. v. MegaTrans Logistics, Inc.,

322 F.3d 928, 933 (7th Cir. 2003) (Ripple, J., concurring).

However, as explained in the text, defendants have submitted

undisputed evidence showing that WEAL and Citizens were in

privity. Thus, for purposes of evaluating plaintiffs’ motion for a

preliminary injunction, | find that plaintiffs have no likelihood

of showing that Citizens and WEAL were not in privity.

is The Ackerville Bridge project is WisDOT Project I.D.

# 2748-01-00. A more detailed statement of the facts

surrounding the project can be found in the Seventh Circuit's

opinion in Citizens |. See Highway J Citizens Group, 349 F.3d

at 941-63.

App. 43

occurred on Highway 164 adjacent to the northern

terminus of the County J/Highway 164 project,

involved the construction of a bridge and the

reconstruction of Lovers Lane Road in Washington

County. The FHWA approved the Ackerville Bridge

and County J/Highway 164 projects in separate RODs.

Because WisDOT and FHWA viewed the Ackerville

Bridge project as distinct from the County J/Highway

164 project, the EIS governing the latter project did not

address the environmental impacts of the former.

Further, WisDOT and FHWA did not prepare a

separate EIS for the Ackerville Bridge project because

they determined that the applicable regulations did not

require one.!9

Citizens raised three issues in Citizens I. First,

it argued that WisDOT’s and FHW4A’s decision to treat

the Ackerville Bridge project and the County

J/Highway 164 project as separate projects violated

NEPA, the applicable regulations and the APA.”

19 CEQ and other agency regulations govern when an

agency must prepare an EJS. Under the regulations, when a

proposed action is neither one normally requiring an EIS nor

one categorically excluded from the EIS process, the agency

must prepare an environmental assessment (“EA”). Highway J

Citizens Group, 349 F.3d at 953. An EA is a “shorter, rough-cut,

low-budget EIS . . ., ‘which providels] evidence and analysis

that establishles] whether or not an EIS or a Finding of No

Significant Impact (FONSI’) should be prepared.” Jd. (quoting

40 C.F.R. § 1508.9(a)(1)) (alterations in original). A FONSI

“briefly presents the reasons why the proposed agency action

wil] not have a significant impact on the human environment.”

Public Citizen, 124 S. Ct. at 2210.

20 In the terminology of NEPA case law, Citizens

argued that the County J/Highway 164 project was improperly

“segmented” from the Ackerville Bridge project . See Highway J

Citizens Group, 349 F.3d at 962-63.

App. 44

Citizens further argued that, even if the projects were

legitimately distinct, the FHWA’s decision to approve

the Ackerville Bridge project without preparing an EIS

had to be set aside under the APA. Highway J Citizens

Group, 349 F.3d at 952-60. Finally, Citizens argued

that the decision to approve the Ackerville Bridge

project violated the APA because WisDOT and FHWA

did not consider sufficient reasonable alternatives to

the project, as required by NEPA. Id. at 960-62. The

relief requested in Citizens I included enjoining the

defendants from proceeding with further work on the

Ackerville Bridge project, requiring the defendants to

prepare an EIS for that project, requiring the

defendants to prepare a FEIS “for all of the County

J/Highway 164 project, including that portion

consisting of the Ackerville Bridge project, and

“[plreliminarily and permanently enjoining the

defendants from widening County J/Highway 164 from

I-94 in Waukesha County to STH 60 in Washington

County from two to four lanes.” (Citizens I Compl. at

13-14.)2!

In the present case, plaintiffs argue that they

did not challenge the March 6, 2002 ROD in Citizens I.

Specifically, they argue that “while both [the Ackerville

Bridge project and the County J/Highway 164 project]

were indeed mentioned or referred to in that litigation,

[Citizens I) concerned the plaintiffs challenges to one

of the projects, that being the Ackerville Bridge

project.” (Pls.’ Reply Br. [R. 23] at 3 (emphasis in

original)). However, although Citizens never mentioned

the March 6, 2002 ROD in Citizens I, it 1s clear that it

—— a

21 The Citizens I complaint is part of the record in the

present case as Defendants’ Exhibit 1021.

App. 45

challenged that decision in that case when it argued

that the County J/Highway 164 project was improperly

segmented from the Ackerville Bridge project.22 A claim

that one project was improperly segmented from

another is necessarily a claim that the environmental

review conducted for each project was inadequate

because each review failed to consider’ the

environmental effects of the other project. Thus, a

claim of improper segmentation is a claim that a court

must set aside each decision approving the segmented

projects under the APA because neither decision

complied with NEPA and the applicable regulations

and therefore both decisions were “arbitrary,

capricious, an abuse of discretion, or otherwise not in

accordance with the law.” 5 U.S.C. § 706(2)(A).

Accordingly, in Citizens I, by arguing that WisDOT and

FHWA improperly segmented the County J/Highway

164 project from the Ackerville Bridge project, Citizens

22 Whether one highway project was improperly

segmented from another is governed by a FHWA regulation, 23

C.F.R. 771.111(f)(1)-(3). See Highway J Citizens Group, 349

_ F.3d at 962. This regulation provides as follows:

(f) In order to ensure meaningful evaluation of

alternatives and to avoid commitments to

transportation improvements before they are fully

evaluated, the action evaluated in each EIS or finding

of no significant impact (FONSD shall:

(1) Connect logical termini and be of sufficient

length to address environmental matters on a

broad scope;

(2) Have independent utility or independent

significance, i.e., be usable and be a reasonable

expenditure even if no additional transportation

improvements in the area are made: and

(3) Not restrict consideration of alternatives for

other reasonably foreseeable transportation

improvements. Id.

App. 46

argued that (1) the ROD approving the Ackerville

Bridge project had to be set aside under the APA

because the FHWA failed to assess the environmental

impacts of the project through an EIS that included the

County J/Highway 164 project; and (2) the ROD

approving the County J/Highway 164 project had to be

set aside under the APA because the FHWA failed to

assess the environmental impacts of the project

through an EIS that included the Ackerville Bridge

project. Indeed, Citizens must have recognized that

success on their segmentation claim in Citizens I

entailed the invalidation of the ROD which approved

the County J/Highway 164 project because, in that

case, Citizens sought to enjoin the County J/Highway

164 project and compel FHWA and WisDOT to prepare

an EIS governing both projects. (See Citizens I Compl.

at 13-14.)

Thus, I conclude that Citizens challenged the

March 6, 2002 ROD in Citizens I.”

b. Whether Present Challenge to March 6, 2002 ROD is

a Different “Claim.” —

23 In arguing that Citizens did not challenge the

County J/Highway 164 project in Citizens I, plaintiffs rely on

language in the Seventh Circuit's opinion in that case stating

that the County J/Highway 164 project “is relevant to this

litigation only because Citizens believes that it was improperly

segmented from the Ackerville Bridge Project.” Highway J

Citizens Group, 349 F.3d at 942. However, as explained in the

text, by bringing in the County J/Highway 164 project as part of

its segmentation argument, Citizens necessarily challenged the

FHWA’s decision to approve the project. Thus, although

Citizens challenged the County J/Highway 164 project in

Citizens | “only because” it believed that it was improperly

segmented, id., that does not mean that it did not, in fact,

challenge such project.

App. 47

Having determined that Citizens challenged the

March 6, 2002 ROD in Citizens I, the question becomes

whether plaintiffs’ current challenge to the same ROD

is the “same claim” for claim preclusion purposes. See,

e.g., Herrmann v. Cencom Cable Assocs., Inc., 999 F.2d

223, 226-27 (7th Cir. 1993) (explaining that claim

preclusion bars relitigation of the same claim). If two

purported claims are really one, prior litigation of one

such “claim” bars litigation of the second in a

subsequent lawsuit. Id. However, as numerous courts

and commentators have recognized, the standard for

when two claims are so closely related that they are

really the same is not precise. See, e.g., Colonial Penn

Life Ins. Co. v. Hallmark Ins. Adm’rs, Inc., 31 F.3d 45,

447 (7th Cir. 1994); Herrmann, 999 F.2d at 226- 27; 18

Moore et al, supra, § 131.20 (stating that there is no

bright line test for determining whether claim was

subject of prior action and providing overview of

various courts’ approaches to the issue). The Seventh

Circuit has “suggestled]” that “two claims are one for

purposes of [claim preclusion] if they are based on the

same, or nearly the same, factual allegations.”

Herrmann, 999 F.2d at 226. 'n other cases, the Seventh

Circuit has examined whether the claims are part of

the “same transaction” or involve a “single core of

operative facts giving rise to a remedy.” Doe v. Allied-

Signal, Inc., 985 F.2d 908, 913 (7th Cir. 1993) Gnternal

quotation marks and citation omitted). The court has

also stated that “[o]nce a transaction has caused injury,

all claims arising from that transaction must be

brought in one suit or lost,” and that “[a] plaintiff may

not avoid an earlier judgment on the merits by merely

concocting a new legal theory.” Id. at 913-14 (internal

quotation marks and citation omitted).

App. 48

Although the applicable standard is imprecise, it

is clear that under any of the above formulations,

plaintiffs’ present challenge to the March 6, 2002 ROD

is the same claim as the claim that Citizens raised in

Citizens I involving the same ROD. Both challenges

| involve “the same, or nearly the same factual

allegations,” arise out of the “same transaction,” and

involve a common “core of operative facts,” 1.e., the

| approval of the County J/Highway 164 project. Further,

| plaintiffs have advanced no persuasive reason for

| finding that their current challenge to the March 6,

| 2002 ROD should be viewed as a different claim.

Essentially, plaintiffs argue that they should be able to

| challenge the March 6, 2002 ROD in the present case

| because they are challenging it for different reasons

than Citizens did in Citizens I. That is, they argue that

_ in Citizens I, Citizens challenged the ROD under

_ NEPA on improper segmentation grounds, whereas in

the present case, plaintiffs challenge the ROD on the

ground that it violated NEPA in numerous other

respects and § 128 of the Federal Aid Highway Act.

| However, accepting plaintiffs’ argument would mean

| that the same party could bring successive APA

| challenges to the same agency decision so long as in

| each lawsuit the party raised a new reason for

invalidating the decision. For example, a party could

bring an initial suit raising improper segmentation

under NEPA, a second suit raising a second NEPA

violation, a third suit raising a third NEPA violation, a

fourth suit raising a violation of § 128 of the Federal

Aid Highway Act, a fifth suit alleging that the Federal

on Highway Act is unconstitutional, etc. Allowing a

party to bring such successive claims would defeat the

value of finality that claim preclusion is designed to

protect. See, e.g., Tice, 162 F.3d at 970 (explaining that

claim preclusion serves the needs of litigants and the

judicial system alike for finality of decisions after a full

App. 49

and fair airing of the matter”); 18 Moore et al, supra, §

131.12[3][2] (explaining that the concept of finality is

central to doctrine of claim preclusion). Thus, I cannot

accept plaintiffs’ argument that a party can bring

successive challenges to the same agency decision as

long as each successive challenge raises a new reason

for overturning the decision.

Finally, plaintiffs seem to argue that because

Citizens I was primarily about the Ackerville Bridge

project, they should be able to raise new challenges to

the County J/Highway 164 project in the present case.

However, although Citizens I was primarily about the

challenge to the Ackerville Bridge project, as explained

above, Citizens also raised the County J/Highway 164

claim in its first suit.24 And there is no exception to

claim preclusion which allows parties to relitigate a

claim on the ground that they only litigated that claim

a little bit, or to a lesser extent than another claim, in

their first suit. Rather, as long as the first suit provided

the opportunity to fully litigate a raised claim (and

plaintiffs here do not claim that Citizens was denied a

full and fair opportunity to litigate the County

J/Highway 164 claim in Citizens I), claim preclusion

24 Under the analysis set forth in the text, the

challenge to the decision to approve the Ackerville Bridge

project was a different claim than the claim involving the

County J/Highway 164 project because the former arose out of a

separate set of facts or a separate transaction than the latter.

Thus, in Citizens |. Citizens raised two distinct claims for claim

preclusion purposes ~— the claim involving the County

J/Highway 164 project and the claim involving the Ackerville

Bridge project. Had Citizens confined itself to challenging the

Ackerville Bridge Project in Citizens I, the judgment in that

case would not preclude its challenge to the County J/Highway

164 project in the present case.

App. 50

bars any subsequent relitigation. See Pireta v. Vill. of

N. Aurora, 935 F.2d 909, 913 (7th Cir. 1991) (stating

that claim preclusion bars party from litigating a claim

if party had a full and fair opportunity to litigate claim

in prior lawsuit).

Thus, for the reasons stated, I conclude that

Citizens raised plaintiffs’ present challenge to the

March 6, 2002 ROD in Citizens I. Accordingly, because

Citizens I and the present case also involve identical

parties or their privies, and because Citizens I resulted

in a judgment on the merits, I conclude that claim

preclusion likely bars plaintiffs’ present challenge to

the March 6, 2002 ROD. Plaintiffs therefore have not

shown a likelihood of success on the merits of their

claim involving NEPA and the Federal Aid Highway

Act, and their motion for preliminary relief based on

such claim will be denied.

B. Clean Water Act

The § 404(b)(1) guidelines provide that “no

discharge of dredged or fill material shall be permitted

if there is a practicable alternative to the proposed

discharge which would have less adverse impact on the

aquatic ecosystem, so long as the alternative does not

have other. significant adverse environmental

consequences.” 40 C.F.R. § 230.10(a). A “practicable

alternative” is one that “is available and capable of

being done after taking into consideration cost, existing

technology, and logistics in- light of overall project

purposes.” Id. § 230.10(a)(2). If a proposed project does

not require access or proximity to or siting within

wetlands to fulfill its basic purpose, i.e., if the project is

not “water dependent,” practicable alternatives are

presumed to be available, “unless clearly demonstrated

otherwise.” See id. § 230.10(a)(3). Courts have held that

App. 51

when a project is not water dependent, the ACOE “may

not issue a § 404 permit unless the applicant, with

independent verification by the [ACOE], provides

detailed, clear and convincing information proving that

an alternative with less adverse impact is

impracticable.” Greater Yellowstone Coalition, 359 F.3d

at 1269 (internal quotation marks, alterations and

citation omitted, emphasis in original). “This

presumption of practicable alternatives is very strong.”

Nat] Wildlife Fed’n v. Whistler, 27 F.3d 1341, 1344

(8th Cir. 1994) (internal quotation marks and citation

omitted, emphasis in original). However, the Supreme

Court has stated that “the concept of alternatives must

be bounded by some notion of feasibility,” and that:

[clommon sense also teaches us that [a

discussion of alternatives] cannot be found

wanting simply because the agency failed to

include every alternative device and thought

conceivable by the mind of man. Time and

resources are simply too limited to hold that [a

discussion] fails because the agency failed to

ferret out every possible alternative, regardless

of how uncommon or unknown that alternative

may have been at the time the project was

approved.

Vt. Yankee Nuclear Power Corp. v. Natural Res. Def.

Council, Inc,, 435 U.S. 519, 551 (1978).

In the present case, the County J/Highway 164

project is not water dependent, and thus the

presumption of existing practicable alternatives

attaches, and the ACOE is required to “clearly

demonstrate” that there are no practicable alternatives

to the project. Plaintiffs contend that the ACOE has not

met this burden because it failed to consider an

App. 52

alternative that plaintiffs call the “Old Highway 164"

alternative and because the ACOE’s evaluation of

alternatives involved an understatement of the amount

of wetlands impacted by the County J/Highway 164

project.

1. Failure to Consider “Old Highway 164" Alternative

Plaintiffs contend that the ACOE has not clearly

demonstrated that an “off-alignment alternative’ —

which plaintiffs label “the Old Highway 164"

alternative — is impracticable. (See Pls.’ Letter Br. [R.

25] at 2-3.)26 This alternative proposes routing traffic

from 1-94 to US 41°45 via Old Highway 164 and

Highways VV, 74 and Y.?? The route begins by taking

25, As the FEIS uses the phrase, “off-alignment

alternatives” are alternatives that involve diverting traffic

through roadways other than County J/Highway 164 so as to

avoid the need to expand County J/Highway 164 to four lanes.

(See FEIS at 2-4 to 2-5.)

26 [nitially, plaintiffs also argued that the ACOE failed

to consider an alternative referred to as the “Power Line” or

“Power Corridor” alternative. (See Pls.’ Br. In Supp. [R. 7] at

25.) However, at oral argument, plaintiffs stated that they were

no longer pursuing this argument. (Tr. at approx. 64.)

(Citations to the transcript of the oral argument held on the

present motion are approximate because the final transcript

was not prepared at the time of this decision.)

27, In describing this alternative, I rely on plaintiffs’

description on page two of their letter brief [R. 25], and am

comparing it with Defendants’ Exhibit 1038. “Old Highway 164"

is the roadway labeled “164" just east of the County J/Highway

164 project on Defendants’ Exhibit 1038. To avoid confusion, I

note that many other proposed alternatives to the County

J/Highway 164 project incorporate Old Highway 164. However,

references to “the Old Highway 164 alternative” in this decision

are references to the alternative described in the text.

App. 53

Old Highway 164, an existing four-lane highway, north

to Highway VV. Traffic turns east on VV to Highway

74, takes Highway 74 to Highway Y, and then takes

Highway Y to the US 41-45 interchange. The

alternative involves widening Highways VV and 74 to

four lanes; Highway Y would also be expanded to four

lanes, but WisDOT has already decided to widen

Highway Y as part of a different project, and thus only

Highways VV and 74 would need to be widened to

construct the Old Highway 164 alternative. Plaintiffs

argue that this alternative would impact fewer

wetlands than the County J/Highway 164 project but

still serve the project's purposes.

Neither the FEIS or the ACOE’s decision

approving the § 404 permit contains a discussion of the

Old Highway 164 alternative. However, the FEIS, on

which the ACOE relied in analyzing practicable

alternatives, considered and rejected a number of other

off alignment alternatives involving Old Highway 164.

(See FEIS Exs. 2-5, 2-6 & 2-8.) Further, plaintiffs have

not cited to any part of the administrative record

indicating that anyone ever brought the Old Highway

164 alternative to the ACOE’s attention before it

approved the § 404 permit. Although plaintiffs claim

that “the Old Highway 164 alternative was raised at

the first Project Advisory Committee meeting on Aug.

10, 1999” (Pls.’ Letter Br. [R. 25] at 2), the portions of

the record cited do not support this claim.” Plaintiffs

8 Specifically, plaintiffs cite page 8-2 of the FEIS, but |

do not see any reference to what plaintiffs describe as the Old

Highway 164 alternative on that page. Page 8-3 states that

Citizens advocated an alternative that involved improving “the

Old WIS 164/County Y/US 41

(continued...)

App. 54

also state that the “failure to consider this alternative

in the Draft EIS was objected to in public comments.”

(Id.) But again, the part of the record cited does not

support the assertion.2® Indeed, the plaintiffs did not

make clear what they meant by “the Old Highway 164

alternative” until oral argument on the present motion

and a letter they filed in response to the court’s

(...continued)

and US 45 corridor,” but this could be a reference*to what the

FEIS discussed and described as the “County Y Corridor”

alternative. (See FEIS at 2-15 & Ex. 2-8.) Plaintiffs also cite

paragraph nine of Gonyo’s initial affidavit [R. 7, attachment #1]

in support of their contention that they raised the Old Highway

164 alternative during the EIS process, which states that “lals

early as the first Project Advisory Committee meeting on

August 10, 1999, . . . the agency was asked to consider

maintaining highway J/164 as an improved 2-lane highway and

improving ‘Old Highway 164’ as an alternative to the proposed

project.” However, almost every off-alignment alternative

involved maintaining County J/Highway 164 as an improved

two-lane highway and improving Old Highway 164. (See FEIS

Exs. 2-5, 2-6 & 2-8.) Thus, Gonyo’s affidavit does not indicate

that anyone raised the Old Highway 164 alternative during the

EIS process, as opposed to one of the other alternatives

involving Old Highway 164.

29 Specifically, plaintiffs cite DOT313WIS of Defs.’ Ex.

1007 in support of their assertion. This document states that

“WisDOT also failed to consider expanding old Highway 164 to

74 to Highway Y, a possibly less disruptive alternative.”

However, like the FEIS and Gonyo Affidavit, this document

does not go into sufficient detail so as to distinguish what

plaintiffs refer to as the Old Highway 164 alternative from

other alternatives involving Old Highway 164 which defendants

considered, such as the County Y Corridor aiternative. In any

event, even if this document is specific enough to distinguish

the Old Highway 164 alternative from other simular

alternatives, it does not explain why that alternative warranted

separate discussion. Instead, it simply asserts that the Old

Highway 164 alternative was “possibly less disruptive.”

App. 55

question about what they meant. (See Pls.’ Letter Br.

[R. 25] at 2.) Prior to oral argument, defendants and I

thought plaintiffs’ references to the Old Highway 164

alternative were references to the County Y Corridor

alternative. (See Defs.’ Br. in Opp. [R. 19] at 25; Tr. at

approx. 65-68.) Thus, as far as the record reveals, no

one brought the Old Highway 164 alternative and its

potential advantages over the selected alternative to

the ACOE’s attention before it decided to issue the §

404 permit.

Because no one brought the Old Highway 164

alternative to the ACOE’s attention during the permit

review process, the ACOE’s failure to demonstrate that

this alternative was impracticable does not render its

decision to issue a § 404 permit to WisDOT arbitrary

and capricious. As stated, the § 404(b)(1) guidelines do

not require the ACOE to rule out every conceivable

alternative, “regardless of how uncommon or unknown

that alternative may have been at the time the project

was approved.” Vt. Yankee, 435 U.S. at 551. Based on

the present record, the Old Highway 164 alternative

appears to have been unknown to the ACOE at the

time it decided to issue the permit. The study area of

the County J/Highway 164 project involved numerous

alternative streets (see FEIS Ex. 2-9), the various

combinations of which could have provided a large

number of alternative routes. The ACOE cannot be .

expected to evaluate every possible combination of

streets and explain why each individual alternative

route is impracticable as compared to the selected

alternative. See id. (stating that “[tlime and resources

are simply too limited to hold that [a discussion of

alternatives] fails because the agency failed to ferret

out every possible alternative”).

App. 56

Perhaps if the Old Highway 164 alternative

were obviously superior to the chosen alternative, the

ACOR’s failure to rule it out could be deemed arbitrary

and capricious even though no one brought it to the

ACOE’s attention and explained its advantages.

However, the record contains no indication that the Old

Highway 164 alternative was obviously superior.

Although plaintiffs believe that the alternative would

have met all of the project's goals while impacting

fewer wetlands, the record suggests a number of

possible problems with the route. First, to construct

plaintiffs’ alternative, WisDOT would have had to

construct an expensive railroad crossing, which would

have increased the project’s cost. (See Defs.’ Ex. 1046 at

6.) Second, thé FEIJS indicates that off-alignment

alternatives similar to the Old Highway 164

alternative would not have met the goals of the project

because they were “inconsistent with regional and

county transportation system plans that document the

importance of County J/WIS 164 as a major north-

south arterial and the need for capacity expansion” on

that roadway. (FEIS at 2-15.) Thus, the Old Highway

164 alternative was not an obvious alternative that the

ACOE should have discussed even though no one

proposed it.

Accordingly, for the reasons stated, I conclude

that the ACOE’s failure to discuss the Old Highway

164 alternative did not render its decision to issue a §

404 permit arbitrary and capricious.

2. Understatement of Wetlands Impacts

According to plaintiffs, the FEIS states that the

second phase of the County J/Highway 164 project will

App. 57

impact 5.27 acres of wetlands.?° However, the § 404

permit issued to WisDOT allows it to fill 9.27 acres of

wetlands as part of the second phase, a difference of

four acres. Plaintiffs argue that although the ACOE

recognized that the FEIS understated the wetlands

impacts of the County J/Highway 164 project, it

nonetheless relied on the FEIS’s comparison of

alternatives in conducting its practicable alternatives

analysis. Plaintiffs state that this rendered the ACOE’s

consideration of practicable alternatives inadequate

because such consideration did not take into account

the actual wetlands impacts of the County J/Highway

164 project when comparing it to the alternatives.

However, as stated, the § 404(b)(1) guidelines

prohibit the ACOE from issuing a permit for a proiect if

there is a practicable alternative that will have “less

adverse impact on [wetlands], so long as [that

alternative] does not have other significant adverse

environmental consequences.” 40 C.F.R. § 230.10(a).

The FEIS’s understatement of the amount of wetlands

impacted by the County J/Highway 164 project only

affects one part of this alternatives analysis, 1.e.,

whether an alternative will have a less adverse impact

on wetlands than the applicant’s preferred alternative.

- It does not affect whether an alternative is practicable

or whether it will have other adverse environmental

consequences. Thus, the ACOE’s reliance on the four-

acre understatement in the FEIS would matter only if

it rendered the ACOE’s conclusion that a particular

30 Plaintiffs represent that phase two will impact the

wetlands listed as W-6 to W-16 on Table 4-12 on page 4-37 of

the FEIS. (Pls.’ Br. in Supp. [R. 7] at 18-19.) By my calculation,

that means that the FEIS represents that phase two will

impact 5.27 acres of wetlands.

App. 58

practicable alternative would impact more wetlands

than the County J/Highway 164 p

This text is long and has been trimmed here. Open the source document for the complete record.

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