United States: The Dirt - Land Use, Environmental, Natural Resources and Consumer Products Law and Regulation, Fall 2006

Editor’s Letter

While Morrison & Foerster LLP has long been at the forefront of cutting-edge environmental issues, it is the firm’s ability to identify and analyze problems and possibilities for its clients and friends that sets it apart. Rather than merely provide dry legal analysis without real world context and application, we strive to give a practical assessment of how a new law or case or rule will affect your day-to-day operations.

An example is a recent seminar on AB 32, the California Global Warming Solutions Act of 2006, held by the Land Use and Environmental Law Group. Presented by the firm’s own Michèle Corash, with Andrea Russell of Rio Tinto Minerals and Joel Levin of the California Climate Action Registry, the seminar provided three different and complementary perspectives on the opportunities and obstacles for the regulated community in responding to the emergence of the new legal regime. If you are interested in receiving a copy of the seminar materials or being on the mailing list for future events, please contact Judy Burgin at JBurgin@mofo.com.

This issue of The Dirt continues the dialogue on this rapidly evolving area with an article on how (and if) a European-style emissions market could be applied in California. We also provide articles on two important recent victories for our clients, one decision upholding the habitat conservation plan in California’s Natamos Basin and another decision dismissing an "anti-SLAPP" motion by a private environmental enforcer. Another article addresses the ongoing debate over whether citizen-sponsored referendum and initiative petitions need to comply with the Voting Rights Act. Next, we offer an analysis of a new case that may affect the relationship between development moratoria and vested subdivision maps. We also provide a discussion of the recent dismissal of an Unfair Competition Law action against several windpower operators based on the public’s "ownership" of birds. Finally, the California Department of Fish and Game provides a response to our article in the last issue on consistency determinations under the California Endangered Species Act—to which we respond as well.

Thank you for the many compliments on the inaugural issue of The Dirt. We hope this issue continues to meet your high expectations for up-to-date and practical information you can use. Please feel free to contact us with any comments or suggestions for future issues or articles.

New Climate Change Law – Kyoto in California?
By Bill Sloan

The signing ceremony for California’s new climate change law—the Global Warming Solutions Act of 2006 (AB 32)—included a satellite feed of British Prime Minister Tony Blair heralding the achievement. The European interest in California’s new law, however, runs deeper than just a shared environmental vision. For approximately two years now, Europe has been experimenting with carbon emission trading. This market-based mechanism at the core of the Kyoto Protocol is intended to help countries achieve their respective greenhouse gas emission targets. With passage of AB 32, California, the world’s fifth‑largest economy, is now contemplating whether to develop its own carbon trading market in the state. If that happens, the primary question on almost everyone’s mind will be whether California should link its market with the existing European program. While the enthusiasm for such a link is strong, a number of problems should be addressed before California and Europe consummate such an arrangement.

The inclusion of a market-based compliance mechanism in AB 32 was negotiated up to the end. A large portion of the regulated community wants a trading program, while a significant environmental faction is opposed. This debate has pitted the Governor’s office against the leaders of the California Legislature in a remarkably open tug-of-war that is now moving to the administrative rulemaking arena before the California Air Resources Board. The new law only provides that the Board "may adopt" such a program. All eyes are on the Board and on whether it will, or will not, include emission trading as part of the implementation of this new law. Already the Board is soliciting information and advice, trying to gain a better understanding of the benefits and pitfalls involved with emission trading.

Large-scale carbon‑emitting industries have commonly stated a preference for one global integrated emission trading market, as opposed to a patchwork of different regulatory markets that operate on different standards and principles. In seeking to normalize one approach to fit all regulatory efforts, one could expect that Europe’s up-and-running market would be a likely model. However, some of the nuances in how that market is set up, and the international legal principles underlying that market, are unique and do not easily translate into a model for California.

Two primary problems exist with the European trading market: (1) it is designed to be one market but is premised on different individual nations that have committed to meet their own different individual targets—presenting different challenges and pressures that may or may not be feasible under any circumstances; and (2) it depends upon a uniform data approach that is not easily assured across the participating countries. As for the first problem of individual national targets, the Kyoto Protocol (like California’s law) uses 1990 emissions as a benchmark—countries under the Kyoto Protocol have committed to achieving 5% below their 1990 greenhouse gas emission levels by 2012. While this appears to be a uniform standard, it does not represent an entirely level playing field. Since 1990, some European countries have seen their actual national emission levels increase significantly while others have barely increased at all. Moreover, within Europe, there have been adjustments made in favor of more‑developing economies—adjustments that in effect act as a subsidy to reallocate the burden of meeting reduction targets. As a result, some countries participating in the European market will be more capable of reaching their targets and thus generating credits quicker. Integrating California into this program—one where a form of economic subsidization has been built in—may or may not be in the interest of California’s economy.

As for the second problem, the data that underpins each country’s National Allocation Plan for the Kyoto Protocol has built into it a level of uncertainty. Indeed, the guidelines expressly recognize that emission measurements—particularly historic measurements—can be imprecise and, at least in the early stages of implementation, have not been collected uniformly country by country. This data uncertainty played out in dramatic fashion this April when the price of carbon on the European exchange dropped by nearly two-thirds due to the unexpected discovery that many countries were going to handily meet their targets. That plummet in price represented a $36 billion drop in the value of the overall market. Unless and until uncertainties related to poor data understanding and collection have been minimized, the European market will remain a relatively risky carbon emission trading partner for California.

Any approach to a carbon emission trading market under AB 32 would do well to consider carefully these problems with the European model. For now, California should focus on creating its own market within the state before aspiring to go international. Until the Kyoto kinks have been worked out, the vision of a global emission trading market should probably be shelved.

California Global Warming Solutions Act of 2006, 2006 Cal. Stat. 488
(AB 32)

Courts Uphold The Natomas Basin Habitat Conservation Program, Providing Important Guidance for Future Planning In California
By Andrew Sabey and Chad Hales

More than a decade’s worth of habitat conservation planning in the Natomas Basin (Sacramento) was recently put under the judicial microscope in both state and federal courts in California. At issue in the two cases (Environmental Council of Sacramento v. City of Sacramento and National Wildlife Federation v. Norton) was whether the Natomas Basin Habitat Conservation Plan ("NBHCP")—a multi-species, long-term, regional conservation program developed by the City of Sacramento and Sutter County, in consultation with the California Department of Fish & Game and the United States Fish & Wildlife Service ("FWS")—complied with the Federal Endangered Species Act ("ESA"), the California ESA ("CESA"), and the California Environmental Quality Act ("CEQA").

But much more than just the NBHCP was at stake. The petitioners’ challenges exploited practical limitations faced by all public agencies and project proponents striving to balance development with regional conservation planning. The courts’ rulings thus promised to affect, for better or worse, regional conservation planning throughout the state. Fortunately, in significant victories that affirmed core strategies underlying regional habitat conservation planning, both the state and federal courts concluded that the NBHCP fully complied with state and federal environmental laws. The courts’ opinions provide important guidance and clarification for public agencies and project proponents throughout California.

Regional conservation planning often is a lengthy process involving multiple jurisdictions. One of the challenges caused by the time and breadth of such an undertaking is that the surrounding landscape can be in a state of flux with different land use proposals surfacing and actions being considered by various local agencies, some of which may not be parties to the regional conservation planning process. The problem is that the environmental analysis for the regional plan cannot be amended to include a new cumulative impact analysis each time a local agency is asked to consider some future project, no matter how speculative. If this were required, the plan might never be finalized.

The petitioners challenged the NBHCP on those grounds, focusing on a memorandum of understanding ("MOU") between the City of Sacramento and the County of Sacramento. The MOU concerned certain revenue-sharing and division-of-responsibility aspects of possible future development in the Natomas Basin, beyond that development contemplated by the NBHCP. The petitioners theorized that development under the MOU was "reasonably certain to occur" and that the MOU was a "probable future project" that required the lead agencies to conduct a comprehensive cumulative impact analysis. Both the state and the federal courts rejected this argument. The federal court noted that the MOU was "by no means a concrete plan for development" and that its "tentative, general nature" and the "considerable number of . . . approvals" that remained before any development could occur supported FWS’s determination that the MOU need not be included in the cumulative impact analysis. In similar fashion, the state court concluded that the MOU was not a "project" within the meaning of CEQA and CESA and that given the "amorphous nature of possible development" under the MOU, it was not "amenable to meaningful environmental review." These opinions provide helpful clarification of what courts will consider "reasonably certain" or "probable future" projects, which is particularly valuable to proponents of regional habitat conservation plans.

The courts’ opinions also provide insight into habitat mitigation ratios. Every habitat conservation plan has a mitigation ratio—the number of acres that must be set aside and protected from development for every acre of development. Neither statutory nor case law prescribes a specific ratio, which leaves public agencies and project proponents with the task of identifying the proper ratio—one that adequately compensates for the impacts of "take" of protected species but that does not require so much land as to effectuate a taking requiring just compensation. As just one component of its comprehensive plan, the NBHCP established a 0.5– to–1 ratio (0.5 acre set aside for each acre of development). The petitioners challenged this ratio as inadequate, arguing that the NBHCP should have employed at least a 1:1 mitigation ratio. The courts disagreed with the petitioners and upheld the NBHCP’s mitigation ratio. In so doing, they established at least two noteworthy principles of general application.

First, the courts agreed that mitigation ratios are not properly evaluated in a vacuum. The petitioners’ attack on the NBHCP’s 0.5–to–1 mitigation ratio improperly attempted to focus on the mitigation ratio in isolation from the numerous other components of the NBHCP’s conservation plan (e.g., preconstruction surveys, monitoring, and specific management of the reserves in perpetuity, among others). Both courts found that the entire conservation plan, of which the mitigation ratio was just a part, supported the NBHCP’s use of a 0.5–to–1 mitigation ratio. These decisions strengthen public agencies’ and project proponents’ ability to "fully mitigate" impacts (CESA) and/or mitigate impacts to the "maximum extent practicable" (federal ESA) by combining an array of conservation features that, considered together, may support the use of a particular mitigation ratio.

Second, for the first time, the state court’s opinion extended CEQA’s "substantial evidence" standard to mitigation ratios. It thus confirmed to lead agencies and project proponents that, like other determinations under CEQA, their determination of the mitigation ratio will be evaluated under well-developed "substantial evidence" principles.

Finally, the state court opinion provided important guidance concerning CESA, which prior to the state court’s decision, had received little judicial construction. The lack of judicial gloss on CESA created ambiguities for public agencies and project proponents attempting to fashion conservation measures that would meet CESA’s requirement that the impacts of "take" be "minimized and fully mitigated."

In dicta analyzing whether the NBHCP’s mitigation ratio complied with CESA, the state court held that the definition of "take," as codified at Fish and Game Code section 2081(b)(2), does not include "the taking of habitat alone or the impacts of the taking." Rather, the court stated, "proscribed taking involves mortality." This provides important guidance for public agencies and project proponents in evaluating the potential impacts where the project is expected to adversely impact species’ habitat, but is not anticipated to take any protected species.

Both the state and the federal court opinions represent an important affirmation of the regional habitat conservation planning concept, and provide much-needed guidance and clarification that should help lead agencies and project proponents fashion their habitat conservation plans to withstand attacks under state and federal environmental laws.

Note: Morrison & Foerster LLP represented the City of Sacramento and Sutter County in both court cases.

Envtl. Council of Sacramento v. City of Sacramento, 142 Cal. App. 4th 1018 (2006)

Nat’l Wildlife Fed’n v. Norton, 2005 WL 2175874 (E.D. Cal. Sept. 7, 2005)

Cal. Fish & Game Code § 2081(b)(2)

Trade Group's Declaratory Relief Action Against Private Enforcer Found Not to be a "Slapp" Suit
By Bill Tarantino

California’s anti-Strategic Lawsuit Against Public Participation ("SLAPP") law was designed to protect citizens from being harassed for exercising their rights to petition the government. Under the law, if a cause of action against him or her "arises out of" constitutionally protected conduct, that suit will be considered a SLAPP and subject to a special motion to strike, unless the party bringing the lawsuit can show a probability of prevailing. The classic SLAPP suit is brought "not to vindicate a legal right, but rather to interfere with the defendant’s ability to pursue his or her interests."

While the anti-SLAPP law serves an important purpose by discouraging lawsuits brought to "chill" constitutional rights, the law has had the unintended effect of deterring valid lawsuits aimed at "gray area" conduct. Legitimate plaintiffs have been fearful to sue for conduct that is not clearly protected speech. This issue was recently put to the test by the Fourth Appellate District’s decision in American Meat Institute v. Leeman, in which the court upheld a trial court’s ruling that a trade association’s declaratory relief action against a potential Proposition 65 private enforcer was not a SLAPP.

In the land use and environmental areas, the SLAPP is often found in one of two scenarios: (1) a project proponent/land developer either sues a project opponent for objecting to the project publicly or brings an action against a permitting authority for appealing a decision favorable to the developer, or (2) a regulated company brings an action against a "private attorney general" or other citizen who attempts to draw attention to violation of the law.

A classic example of a SLAPP is Ramona Unified School District v. Tsiknas. Ramona Unified ("RUSD") sought to construct a school and issued a mitigated negative declaration pursuant to the California Environmental Quality Act. When plaintiff RUSD proposed an alteration to the project, defendant Neighborhood Alliance for Safe Ramona Schools ("NASRS") filed a writ petition alleging that the proposal violated CEQA. RUSD prevailed at trial, and the court dismissed the action. Not satisfied with mere victory, RUSD sued NASRS and its attorneys, including Tsiknas, for abuse of process and barratry. Finding that RUSD’s suit was lacking merit, the trial court refused to impose liability on NASRS for exercising its right to challenge government action and granted NASRS’s anti-SLAPP motion to strike.

A contrary suit in the land use context was Visher v. Malibu, in which the City of Malibu refused to process the plaintiffs’ application for a coastal development permit ("CDP") to build a home on their vacant lot. Malibu was engaged in litigation over whether it was obligated to issue such a permit. Because Malibu was appealing the trial court’s order that it was compelled to issue a CDP, Malibu refused the plaintiffs’ request. The plaintiffs filed a petition for writ of mandate to compel Malibu to act, which Malibu sought to dismiss as a SLAPP, claiming that the petition arose from Malibu’s decision to exercise its right to appeal its trial court loss. The court of appeal found this unpersuasive, concluding that while appealing an order is a protected activity, the plaintiffs’ lawsuit did not "arise from" that activity, but from the plaintiffs’ "desire to get a CDP to build their home."

Both cases above illustrate the long-standing difficulty under the anti-SLAPP statute in discerning between protected activity and legitimate bases for filing suit. The decision in American Meat Institute v. Leeman provides some clarity on the issue.

In American Meat Institute, the meat industry sought a declaratory judgment finding that Proposition 65 was preempted by the Federal Meat Inspection Act ("FMIA"), and that the California warning requirement could not be applied to meat products that comply with the FMIA. The trade groups sued after private attorney general Whitney R. Leeman had issued 60‑day intent‑to‑sue notices and threatened the industry with legal action. The trial court found that, while Dr. Leeman certainly had engaged in protected conduct, the trade association’s action was based on the conflict between state and federal law, not Dr. Leeman’s freedom of speech.

On appeal, Dr. Leeman (joined by the California Attorney General as amicus) argued that the trial court’s ruling would allow private citizens to be sued at random by trade associations if the citizens questioned the industry’s legal compliance. Rejecting this broad reading of the trial court’s opinion, the court of appeal affirmed the ruling and emphasized that the nature of the declaratory relief action controlled the analysis. The court concluded that the trade association’s claim did not "arise from" Dr. Leeman’s conduct, but instead from a legitimate desire to clarify an issue of conflicting state and federal laws.

This case highlights the importance of a careful reading of the anti-SLAPP statute and related case law. It is not enough for the allegedly SLAPP-ed defendant to show that she engaged in protected conduct. The defendant must establish that the claim arises from that conduct — the fact that the conduct merely "triggers" legal action is not enough. In other words, the defendant must show that the plaintiff is seeking to impose liability for the conduct or that the conduct is an essential element of the plaintiff’s cause of action. In cases involving declaratory relief, plaintiffs do not seek to impose any liability, as they are only seeking clarity from the courts regarding their respective rights and obligations.

Note: Morrison & Foerster LLP represented the American Meat Institute and the National Meat Association in the case.

Cal. Civ. Proc. Code §§ 425.16-425.18

Am. Meat Institute v. Leeman, Case No. D047115 (Ct. App. 4th Dist. Aug. 31, 2006)

Ramona Unified Sch. Dist. v. Tsiknas, 135 Cal. App. 4th 510 (2005)

Visher v. Malibu, 126 Cal. App. 4th 363 (2005)

Applicability of Voting Rights Act to Initiatives and Referenda Remains Uncertain Following Ninth Circuit Decision
By John Doorlay

A eagerly anticipated recent decision by the Ninth Circuit Court of Appeals failed to clear up uncertainty over whether the minority language requirements of the federal Voting Rights Act apply to citizen-sponsored initiatives and referenda in California. The court’s en banc decision in Padilla v. Lever held that the Act’s minority language provisions do not apply to recall petitions, but did not address initiative and referendum petitions. It remains uncertain, therefore, whether the Act requires initiative and referendum proponents in jurisdictions subject to it to translate their petitions into minority languages.

In jurisdictions with substantial voting-age populations not proficient in English, the Voting Rights Act requires certain election materials to be provided in minority languages as well as English. Specifically, section 203 of the Act states that whenever a state or political subdivision with a specified voting-age population not proficient in English "provides any registration or voting notices, forms, instructions, assistance, or other materials or information relating to the electoral process, including ballots, it shall provide them in the language of the applicable minority group as well as in the English language." 42 U.S.C. § 1973aa-1a(c).

The list of jurisdictions designated by the Director of the Census as subject to the Voting Rights Act and, therefore, requiring election material to be provided in a language or languages other than English, is available in the Federal Register. In California, statewide election materials must be provided in English and Spanish, and 25 counties must provide election materials in one or more languages other than English. Whenever a particular county is subject to section 203, all cities within that county are similarly subject to section 203.

There is no question the Voting Rights Act requires covered jurisdictions such as a county holding an election to provide ballots in English as well as minority languages. However, it is less clear whether this provision applies to citizen-sponsored petitions to qualify a measure for the ballot. For example, in order for a referendum, citizen-sponsored initiative, or public official recall to qualify for an election, the proponents must prepare a petition and gather signatures from the requisite number of registered voters. The Act does not explicitly address whether such petitions must be prepared and circulated in both English and minority languages.

In Padilla v. Lever, a group of citizens initiated a recall of a member of the Santa Ana Unified School District Board by drafting a recall petition. The Orange County Elections Department reviewed the petition and concluded that it complied with the requirements of the California Elections Code. The recall proponents then circulated the recall petition and gathered the required number of signatures to hold a recall election. Although Orange County is required by section 203 to provide election materials in multiple languages, the recall petition was circulated only in English.

A group of plaintiffs challenged the validity of the recall petition since it was not made available in Spanish. Reversing an earlier decision of a three-judge panel, the full 11-judge panel of the Ninth Circuit rejected the challenge and held that the Voting Rights Act did not apply to recall petitions since the petitions were prepared and circulated by private citizens and, therefore, were not "provided by" a state or political subdivision. This holding affirmed the original ruling of the federal district court.

The plaintiffs in Padilla argued that as a result of California’s extensive regulation of the form of recall petitions and because the Orange County Elections Department had reviewed and approved the form of petition, the "provided by" requirement was satisfied. In rejecting this argument, the Ninth Circuit concluded that although the California Elections Code provides the format for a recall petition, that does not mean the State itself provides the petition. The court noted that the California Elections Code does not specify the actual wording to be used in a recall petition and that the role of the County Elections Department was simply to ensure that the petition complied with the form required by law. As a result, it could not be said that the County "provided" the recall petition to the public. The court also expressed concern about the "chilling effect" of translating petitions into multiple languages, as the costs of translation and reprinting are borne by the recall proponents. The expense and trouble of complying with the translation requirements, reasoned the court, may deter proponents from launching petitions in the first place.

While the Padilla ruling clearly holds that recall petitions are not subject to the Voting Rights Act’s requirement to provide election materials in English as well as minority languages, it remains uncertain whether referendum and citizen-sponsored initiative petitions are similarly exempt from the Voting Rights Act. The Padilla court chose not to address either of these situations. There are procedural and substantive differences between recall petitions, on the one hand, and initiative and referendum petitions, on the other hand, that may make the court’s analysis in Padilla inapplicable to other petitions. Until courts resolve this issue, participants and stakeholders in land use and other electoral issues throughout California must be aware of the potential consequences of failing to follow the Voting Rights Act when they propose a referendum or initiative, as well as the possibility of challenging a referendum or initiative based on failure to comply with the Act.

Padilla v. Lever, 463 F.3d 1046 (9th Cir. 2006) (en banc)

Voting Rights Act, 42 U.S.C. § 1973aa-1a(c)

When Does a Moratorium Become a Mortuary? The Death of a Vesting Tentative Map Under Ailanto Properties, Inc. v. City of Half Moon Bay
By Rob Hodil

California’s First District Court of Appeal recently provided clarification regarding the life of tentative subdivision maps under California’s Subdivision Map Act.

The case, Ailanto Properties, Inc. v. City of Half Moon Bay, involved a vesting tentative map for a residential project in the City of Half Moon Bay that was subjected to significant delays as a result of the City’s water and sewer moratoria. The court refused to extend the life of the vesting tentative map to account for the total actual time of the moratoria. In reaching its decision, the court addressed two issues: (1) how long the life of a tentative map may be extended when a city or county has a development moratorium in effect; and (2) when filing a final map prevents a tentative map from expiring.

The first issue hinged upon the interpretation of a provision of the Map Act, California Government Code section 66452.6(b)(1), which tolls the expiration of a tentative map while a development moratorium is in effect, but provides that "the length of the moratorium shall not exceed five years." The project site at issue was subject to a water service moratorium at the time the vesting tentative map was approved. The site subsequently became subject to a separate sewer moratorium that the City of Half Moon Bay extended several times so that it remained in effect for some eight years.

The developer, who had obtained approval of the vesting tentative map in 1990, argued that the five-year limit applied to the length of the development moratorium itself, rather than the length of the extension of the life of the map. Under the developer’s theory, a tentative map would continue to be extended as long as the development moratorium remained in place. The court rejected this theory, holding that section 66452.6(b)(1) was intended to limit to five years the total length of time that a tentative map could be extended by a development moratorium, rather than limiting the length of a development moratorium itself.

The developer also argued that even if the five-year limit applies to the length of time the life of the map can be extended, a separate five-year limit applies to each development moratorium (and its extension) that delays approval of the final map, so that the expiration of the map had been tolled for multiple five-year periods and the map was still alive. The court also rejected this argument, holding that the five-year limit applied to the total of all development moratoria that could be applied to a project to extend a map.

The second issue in Ailanto was whether "filing" of a final map was sufficient to extend the life of the tentative map, regardless of the development moratorium. Government Code section 66452.6(a)(1) provides that if a subdivider has expended $178,000 or more on off-site improvements, the filing of a final map will extend the life of a tentative map by 36 months. One of the conditions of approval attached by the City to the vesting tentative map required the developer to obtain a coastal development permit, and the developer filed a final map with the city engineer before obtaining it.

The developer argued that the expiration of the tentative map nevertheless was tolled by this submittal, because Government Code section 66452.6(d) provides that delivery of a final map to the city engineer is deemed a timely filing, and does not specify that the delivered final map must meet all conditions of tentative map approval at that time. The court rejected this argument, holding that the filing of a final map that did not conform to the vesting tentative map did not extend the life of the tentative map. The court explained that in this case, there was a "significant deficiency" in the final map, since a coastal development permit was required both by the California Coastal Act of 1976 and by the conditions attached to the vesting tentative map.

The court also rejected the developer’s theory that equitable estoppel prevented the City from claiming that the vesting tentative map had expired. The developer had expended millions of dollars in a good‑faith attempt to fulfill the conditions attached to the vesting tentative map, and alleged that the City had a "practice" of tolling the expiration of a vesting tentative map while a coastal development permit application was pending. Given that practice, the developer argued that its expenditures estopped the City from asserting any five-year limit on the extension of the life of the tentative map due to development moratoria. The court explained that the City did not have the power to indefinitely waive the limitations imposed by state law on the life of vesting tentative maps. Although the court’s rejection of the equitable estoppel argument is dictum (the court found that the developer waived its estoppel claims, but nonetheless discussed the merits of the argument), it could be an obstacle for other defendants attempting estoppel arguments under the Map Act.

This case should serve as a cautionary note to property owners and developers who have obtained approval of either tentative maps or vesting tentative maps (the statutory provisions at issue in the case apply to both types of maps). The Ailanto decision makes it clear that there is a five-year limit on the extension of tentative maps due to development moratoria even if the moratoria extend longer than five years. Potential purchasers of entitled property should also be aware of this rule when conducting due diligence. It is important to note, however, that the Ailanto opinion suggests that there may be an exception to this rule if a city and a property owner agree to waive the time limits on the life of the tentative map.

Additionally, the Ailanto decision clarifies that "filing" a final map that does not conform to the tentative map due to a "significant deficiency" in meeting conditions of approval will not extend the life of the tentative map. On the other hand, the decision leaves some room to argue that a final map that may not strictly satisfy all of the conditions attached to a tentative map nevertheless could extend the life of a final map, if the unfulfilled conditions are not as significant or as clearly unfulfilled as the requirement for a coastal development permit was in this particular case. Subsequent court decisions may provide additional clarity as to what else might constitute a "significant deficiency" in a final map that would similarly result in failure to extend the life of the map.

Ailanto Prop., Inc. v. City of Half Moon Bay, 142 Cal. App. 4th 572 (2006)

Cal. Gov’t Code § 66452.6

Court Dismisses "Altamont" Case, Rejecting Claims Based on Public's "Ownership" of Birds
By Anne Mudge and Shaye Diveley

A closely watched and controversial lawsuit involving several wind operators in California’s Altamont Pass ended with dismissal of the case last month.

The plaintiffs in Center for Biological Diversity v. FPL Group, Inc. sued a group of wind operators in 2004 under two novel theories – that the wind companies are illegally profiting from killing birds in violation of California’s Unfair Competition Law ("UCL"), and that, in killing them, the companies are also violating an alleged "public trust interest" in birds. These legal claims were troubling for the wind industry. To date, wind companies have had only limited legal exposure under wildlife protection laws such as the Migratory Bird Treaty Act ("MBTA") and the Bald and Golden Eagle Protection Act ("BGEPA") because they do not authorize citizen suits—meaning they can only be enforced by the federal government. For the most part, the Justice Department has declined to prosecute wind companies under the Acts.

The plaintiffs in Center for Biological Diversity tried going around this obstacle by using the UCL, which until recently had provided private citizens a right to enforce violations of the MBTA and BGEPA by calling such violations "unfair business practices" under California law. However, shortly after the suit was filed in November 2004, California voters enacted Proposition ("Prop") 64, which amended the UCL to prohibit private suits brought on behalf of the public and not based on loss of money or property suffered by the plaintiff. The wind company defendants quickly brought a motion to dismiss the suit based on the new law, but it was rejected by the court last year, which concluded, among other things, that the plaintiffs sufficiently alleged an injury to property – i.e., birds held in trust by the public.

In the meantime, California courts issued new decisions in 2006 interpreting Prop 64. Armed with this new case law, the defendants moved to dismiss the suit, again based on two arguments—that the plaintiffs lacked standing to sue under the UCL, as amended, and that there is no private right of action for destruction of public trust resources. This time, the court agreed on both counts and dismissed the suit.

First, the court concluded that the loss of "money or property" required for standing under Prop 64 did not include injury to birds. The court looked at the text of the new law, which referred to a loss of money or property in two places. The law limited the standing, or the right to sue, under the UCL to those who "lost money or property as a result of such unfair competition." The law also limited monetary recovery to restitution "necessary to restore any person in interest any money or property" taken as a result of unfair or unlawful business practices. The 2005 decision had concluded that the "money or property" required for standing was broader than that for monetary relief, so that the plaintiffs could maintain their suit based on the alleged injury to birds even if they could not receive monetary relief. In its new decision, the court rejected this argument based on the California Supreme Court’s decision in California for Disability Rights v. Mervyn’s, which held Prop 64 prohibited lawsuits based on "abstract interests." The trial court concluded that because the plaintiffs’ interest in birds was, at most, an abstract interest held in common by the public, the plaintiffs could not show standing or a right to restitution. In other words, if the plaintiffs could not get money for the loss of birds, they could not sue based on harm to the birds either.

Second, the court rejected a cause of action based on the alleged destruction of wild animals held in the public trust. The court found no statutory or common law basis for such a private cause of action, holding that cases have limited such suits to those involving navigable and tidal waters. The court rejected the argument that provisions of the California Fish and Game Code describing wildlife as the "property of the People" create a private right to sue, as the Code also states that any claims for the destruction of such wildlife must be brought by the State, not private individuals.

It is unclear at press time whether the plaintiffs will appeal the court’s ruling, although it is likely because the door has been slammed on private environmental suits based on state law. Even if the defendants are ultimately successful in defeating the suit, the high-profile litigation has propelled bird mortality into the spotlight and has made permitting of new wind projects more difficult and more costly. This may continue to be the case regardless of the ultimate outcome of this particular suit.

Ctr. for Biological Diversity v. FPL Group, Inc. (Alameda Superior Court No. RG04-183113)

Cal. for Disability Rights v. Mervyn’s,
39 Cal. 4th 223 (2006)

Pfizer v. Superior Court, 141 Cal. App. 4th 290 (2006)

Unfair Competition Law, Cal. Bus. & Prof. Code §§ 17200-17210

Migratory Bird Treaty Act, 16 U.S.C. §§ 703-712

Bald & Golden Eagle Protection Act, 16 U.S.C. §§ 668-668d

Cal. Fish & Game Code § 1600

Letters to The Dirt

The Dirt received a letter dated August 7, 2006, from Ann Malcolm, General Counsel of the California Department of Fish and Game ("DFG"), responding to our article in the Summer 2006 issue about consistency determinations under the California Endangered Species Act. We reproduce below, for the benefit of The Dirt readers, Ms. Malcolm’s letter. Our response follows.

I am writing in regard to your July 2006 legal update entitled "Consistency Determinations Under the California Endangered Species Act Streamline Permitting Process," available at http://www.mofo.com/news/updates/files/update02225.html" . The article states that a person submitting a notice pursuant to section 2080.1 of the Fish and Game Code "is allowed to commence activities immediately after submitting these documents" to the Department of Fish and Game (DFG). This view is repeated a second time towards the end of the article. After the article was brought to our attention, we found the same legal interpretation in an earlier article, "Court Decides ‘Consistency Determinations’ Under the California Endangered Species Act Are Not Subject to CEQA Review," dated November 2005 and available at http://www.mofo.com/news/updates/files/update02091.html.

These statements conflict with other provisions in CESA and could, I fear, encourage activities that would amount to a criminal violation of the California Endangered Species Act (CESA). The interpretation would appear to be based on the language in subdivision (a) of section 2080.1 that says no further authorization or approval for take of listed species is required under CESA if a person notifies DFG that a federal authorization has been obtained and provides a copy of the federal document to DFG. But subdivision (a) cannot be read in isolation. Subdivision (c) clearly modifies the language in subdivision (a) by requiring that the taking of a listed species "may only be authorized pursuant to this chapter" – i.e. through one of CESA’s permitting mechanisms – if DFG determines that the federal permit or federal incidental take statement is not consistent with CESA. In other words, more is required under section 2080.1 to take listed species than merely submitting a notice and copy of the federal authorization: the law also requires a determination from DFG’s director that the federal authorization is consistent with CESA before take can lawfully occur.

It is true that a bill analysis prepared for the Assembly Appropriations Committee took a view similar to your own, stating that Assembly Bill 21 (1997), which added section 2080.1, would allow a person to incidentally take species listed under both the state and federal endangered species acts immediately after providing the specified notice to DFG. To the degree legislative history might be relevant to this issue, the Assembly Appropriations Committee analysis is not persuasive, especially since none of the other four legislative analyses prepared for AB 21, including the analyses prepared for the full Assembly and Senate, describe the statute as allowing take prior to a finding of consistency by DFG. Indeed, the other bill analyses, among them those prepared by the policy committees most familiar with CESA, contain language to the opposite effect. Bill reports prepared in advance of Assembly and Senate floor votes both describe the bill as allowing "the director to apply CESA regulations if it is determined that the federal take permit is not consistent with the California law." This, of course, is only possible if the incidental take has not already occurred under sanction of the statute. The Assembly report also states that "an individual need only obtain a federal take permit so long as the director of the Department of Fish and Game (DFG) determines that the federal permit is consistent with California law," and the Senate Rules Committee’s one-sentence digest about the bill said it would authorize "the Director of the Department of Fish and Game under specified circumstances to waive requirements for state incidental take permits for plant and animal species that have been jointly-listed by the state and federal government. . .". These all indicate that the exemption from CESA’s permitting requirement is dependent on DFG determining that the project qualifies for the exemption, and not merely on a person submitting information to DFG.

Finally, I would point out that to interpret the statute in a way that gives all persons holding a federal take permit or biological opinion the right to take species for several weeks while DFG considers the federal document’s consistency with CESA would create a gaping hole in CESA’s protections without any clear evidence that the Legislature intended such a result. Many properties on which development projects are planned could be stripped of all habitat and wildlife within a few weeks, obviating the need for a consistency determination or a state incidental take permit and frustrating the Legislature’s clear intent that projects proceeding under the exemption in section 2080.1 still meet CESA’s permitting standard of take minimization and full mitigation.

The longer the article goes uncorrected, the more likely a client of your firm or another member of the public might prematurely launch activities that could expose the person to a CESA enforcement action. I therefore request you promptly revise the two on-line articles and take appropriate action to inform any readers who received the articles by mail or email about DFG’s interpretation of this section.

I appreciate your attention to this important matter. If you have questions, please contact Deputy General Counsel Stephen Adams at (916) 654-5295 or sadams@dfg.ca.gov.

Sincerely,
Ann S. Malcolm
General Counsel, California Department of Fish and Game

Because the Department of Fish and Game administers the California Endangered Species Act and is responsible for consistency determinations, we bring Ms. Malcolm’s letter to the attention of the readers of The Dirt.

In "Consistency Determinations Under the California Endangered Species Act Streamline Permitting Process" (The Dirt, Summer 2006), we explained that "[u]nder California Fish and Game Code section 2080.1, the applicant is allowed to commence activities immediately after submitting" certain documents required by the statute. Section 2080.1(a) provides:

Notwithstanding any other provision of this chapter, or Chapter 10 (commencing with Section 1900) or Chapter 11 (commencing with Section 1925) of Division 2, but subject to subdivision (c), if any person obtains from the Secretary of the Interior or the Secretary of Commerce an incidental take statement pursuant to Section 1536 of Title 16 of the United States Code or an incidental take permit pursuant to Section 1539 of Title 16 of the United States Code that authorizes the taking of an endangered species or a threatened species that is listed pursuant to Section 1533 of Title 16 of the United States Code and that is an endangered species, threatened species, or a candidate species pursuant to this chapter, no further authorization or approval is necessary under this chapter for that person to take that endangered species, threatened species, or candidate species identified in, and in accordance with, the incidental take statement or incidental take permit, if that person does both of the following:

(1) Notifies the director in writing that the person has received an incidental take statement or an incidental take permit issued pursuant to the federal Endangered Species Act of 1973 (16 U.S.C.A. Sec. 1531 et seq.).

(2) Includes in the notice to the director a copy of the incidental take statement or incidental take permit.

Cal. Fish & Game Code § 2080.1(a).

As explained by an analysis prepared by the Assembly Committee on Appropriations, the statute provides that "[i]mmediately after providing this information to the director, the individual is allowed to start incidentally taking the species." Cal. Assembly Comm. on Appropriations, Analysis of A.B. 21 at 1 (May 13, 1997). The analysis recognized that this could mean a permittee may start operations that the agency may later find inconsistent with the California Endangered Species Act:

Since the "incidental take" can begin immediately upon providing the director with the required information, takes can occur before the director has a chance to review the information and determine whether or not it is consistent with CESA policy. If, in a particular case, the director eventually decides the federal permit is not consistent with CESA policy, a "stop order" could be issued after members of the species have already been taken. Id. at 2. The analysis recommended that the bill be amended so that no take can "take place until the director has made a determination that the information provided is consistent with CESA policy." Id. However, no such amendment was made before the bill was chaptered and became section 2080.1.

This interpretation is also consistent with the non-discretionary nature of consistency determinations. As explained by the Sacramento County Superior Court in Center for Biological Diversity v. California Department of Fish & Game (Sacramento Superior Court Case No. 05CS01166), "the issuance of a consistency determination is not a discretionary project" for the purposes of CEQA, but instead a ministerial act. As a result, so long as the informational requirements of section 2080.1 are satisfied, a consistency determination must issue. This strongly supports the interpretation that operations may commence once these conditions are fulfilled.

All this being said, Ms. Malcolm’s interpretation of the statute should be given appropriate consideration. As it appears to reflect DFG’s considered opinion regarding the requirements of section 2080.1, it presumably would inform DFG’s evaluation of whether a party is in compliance with those requirements. We believe those instances will be rare in which it will be important to an applicant to commence activities prior to the expiration of the 30-day period section 2080.1(c) provides DFG to make a consistency determination. Moreover, we are confident, in light of the issues raised by our exchange with Ms. Malcolm, that in such instances DFG will be especially cognizant of the timing needs of applicants and work diligently to accommodate them. We are pleased to note that Ms. Malcolm does not take issue with the primary focus and conclusion of our article—that consistency determinations are a valuable regulatory tool for streamlining the permitting process.

We welcome further commentary on this issue, as well as on any other topic discussed (or topics that you believe should be discussed) in The Dirt.

Thank you,
Chris Carr and Shaye Diveley

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Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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