Energy and Environment Monitor
Tenth Circuit Declares OSM’s Action “Final” Despite Pending Administrative Review: Authorizes Federal Court Review
August 1, 2017
The U.S. Court of Appeals for the Tenth Circuit has trimmed the discretion that the Office of Surface Mining can assert when it brings an enforcement action against a mining operator. Its decision applies a principle of law announced by the Supreme Court almost 25 years ago in Darby v. Cisneros which most agencies prefer to ignore.
As explained by the Tenth Circuit, Darby makes “intra-agency review ‘a prerequisite to judicial review only when expressly required by statute or when an agency rule requires appeal before review and the administrative action is made inoperative pending that review.’ 509 U.S. 137, 154. This rule prevents agencies from enforcing initial decisions while a mandatory administrative appeal is pending, which would effectively insulate such decisions from judicial scrutiny.” Op. at 2. In other terms, Darby forces an administrative agency to make a choice between immediate compliance with the order issued (independently reviewable by a court) or suspend compliance while further administrative compliance is completed.
Over the course of 40 years of the Surface Mining Act, OSM has contrived enforcement schemes more designed to confuse and exhaust than to achieve review of agency action. Thus, when OSM issues a notice of violation (which it rarely can do given that most coal mining is conducted in states with primary jurisdiction to enforce their programs), review is first conducted in a hearing before an administrative law judge. Review of the ALJ’s initial decision must be conducted before the Interior Department’s Board of Land Appeals, an appellate body within Interior’s Office of Hearings and Appeals. Under the regulations that establish this process, a party subject to an order of an ALJ may seek a stay of the enforcement of the order while the IBLA reviews the decision, but granting the stay is discretionary.
Under the facts of the Tenth Circuit decision, an Oklahoma mining company was denied a stay in its IBLA appeal. It then sought immediate review in a federal district court. The court dismissed the case on OSM’s motion on the grounds that the IBLA’s administrative review was not final. A federal court ordinarily does not have subject matter jurisdiction to hear a case if the agency decision is not final. On appeal the Tenth Circuit reversed, finding that the denial of the stay had the effect of making the ALJ’s decision immediately final and reviewable by the district court.
Administrative litigation with an Interior Department agency can be compared to watching a ship depart from a dock without knowing if it will ever reach its port. With this decision OSM will be forced in future controversies to select whether it will insist upon immediate compliance, and potentially be forced into review in a judicial forum, or complete administrative review while the alleged environmental harm is ongoing. In either case, the mining company is afforded a more certain process before having to comply with OSM’s order.
The case is Farrell-Cooper Mining Company v. U.S. Department of the Interior, No.16-7061, U.S. Court of Appeals for the Tenth Circuit (July 25, 2017).
This article was authored by Blair M. Gardner, Jackson Kelly PLLC.