Wayne Land and Mineral Group L v. Delaware River Basin Commissio ( 2020 )

PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
__________
No. 19-2354
__________
WAYNE LAND AND MINERAL GROUP, LLC
v.
DELAWARE RIVER BASIN COMMISSION
MAYA VAN ROSSUM, The Delaware Riverkeeper;
DELAWARE RIVERKEEPER NETWORK
(Intervenors in District Court)
*SENATORS JOSEPH B. SCARNATI, III; LISA
BAKER; GENE YAW,
Appellants
*Pursuant to Fed. R. App. P. Rule 12(a)
__________
On Appeal from the United States District Court
for the Middle District of Pennsylvania
(D. C. No. 3-16-cv-00897)
District Judge: Honorable Robert D. Mariani
__________
Argued December 9, 2019
Before: RESTREPO, ROTH and FISHER, Circuit Judges.
(Filed: May 19, 2020)
Matthew H. Haverstick, [ARGUED]
Eric J. Schreiner
Shohin H. Vance
Kleinbard
Three Logan Square
1717 Arch Street, 5th Floor
Philadelphia, PA 19103
Counsel for Appellants
Christopher R. Nestor
Overstreet & Nestor
1425 Crooked Hill Road
#62066
Harrisburg, PA 17106
Counsel for Appellee Wayne Land and Mineral Group
LLC
Mark L. Greenfogel
Kenneth J. Warren [ARGUED]
Warren Environmental Counsel
975 Mill Road
Millridge Manor House Suite A
Bryn Mawr, PA 19010
Counsel for Appellee Delaware River Basin
Commission
2
Jordan B. Yeager [ARGUED]
Curtin & Heefner
2005 South Easton Road, Suite 100
Doylestown, PA 18901
Counsel for Appellees Maya Van Rossum, The
Delaware Riverkeeper and Delaware Riverkeeper Network
__________
OPINION OF THE COURT
__________
FISHER, Circuit Judge.
It is well established that a federal court has a duty to
assure itself that the persons invoking its power have standing
to do so under Article III of the Constitution. That principle
applies even to putative intervenors of right under Federal Rule
of Civil Procedure 24(a)(2), who must demonstrate
constitutional standing for each claim they wish to bring if the
claim would result in relief different from that which the
plaintiff seeks. Town of Chester v. Laroe Estates, Inc., 137 S.
Ct. 1645 (2017).
In this case, the District Court ruled on the merits of a
Rule 24 motion by three Pennsylvania state senators before
considering fully whether the Senators need to establish Article
III standing for either of their two proposed claims. Because
we conclude that on each of those claims the Senators appear
to be seeking relief different from that sought by the plaintiff,
and that the District Court is best positioned to decide this
question in the first instance, we will vacate the District Court’s
order and remand for consideration of whether the Senators
must demonstrate Article III standing.
3
I
The underlying dispute in this case is not new to our
Court. See Wayne Land & Mineral Grp. LLC v. Del. River
Basin Comm’n, 894 F.3d 509 (3d Cir. 2018) (Wayne I).
Nevertheless, some account of that dispute is necessary for
adequate disposition of the present appeal.
A
In late 1961, concurrent legislation in Congress and the
states of Delaware, New Jersey, New York, and Pennsylvania
adopted into law the Delaware River Basin Compact.1 That
agreement was designed in part to centralize and coordinate
among the states “the planning, conservation, utilization,
development, management and control of the water resources
of the basin.” Delaware River Basin Compact § 1.3(e) (1961),
https://www.state.nj.us/drbc/library/documents/compact.pdf.2
To this end, the Compact created an interstate agency, the
Delaware River Basin Commission (DRBC), and delegated to
it several powers. Among those powers is the authority to
review and approve any “project having a substantial effect on
the water resources of the basin.” Id. § 3.8. The scope of this
power in turn depends upon the definition of two terms. First,
the Compact defines “project” as
1
Under the Federal Constitution, a state may “enter into any
Agreement or Compact with another State” only with “the
Consent of Congress.” U.S. Const. art. I, § 10, cl. 3. As a result,
the Compact is federal law. See Pub. L. No. 87-328, 75 Stat.
688 (1961).
2
The Basin is defined as “the area of drainage into the
Delaware River and its tributaries, including Delaware Bay.”
Id. § 1.2(a).
4
any work, service or activity which is separately
planned, financed, or identified by the
commission, or any separate facility undertaken
or to be undertaken within a specified area, for
the conservation, utilization, control,
development or management of water resources
which can be established and utilized
independently or as an addition to an existing
facility, and can be considered as a separate
entity for purposes of evaluation.
Id. § 1.2(g). Second, it defines “water resources” as
“includ[ing] water and related natural resources in, on, under,
or above the ground, including related uses of land, which are
subject to beneficial use, ownership or control.” Id. § 1.2(i).
Despite these definitions, the extent of the DRBC’s
review-and-approval authority remains uncertain, and that
uncertainty lies at the heart of the underlying dispute in this
case. In 2009, the then-Executive Director of the DRBC, Carol
R. Collier, invoked § 3.8 to regulate horizontal drilling and
hydraulic fracturing, or fracking, in the Basin. Concerned that
these activities “if not properly performed may cause adverse
environmental effects, including on water resources,” Collier
issued a “Determination” giving “notice to natural gas
extraction project sponsors that they may not commence any
natural gas extraction project located in shale formations
within the drainage area of Special Protection Waters without
first applying for and obtaining [DRBC] approval.” Del. River
Basin Comm’n, Determination of the Executive Director
Concerning Natural Gas Extraction Activities in Shale
Formations Within the Drainage Area of Special Protection
Waters 2 (May 19, 2009) (2009 Determination),
https://www.nj.gov/drbc/library/documents/EDD5-19-
5
09.pdf.3 A “project” was in turn said to “encompass[] the
drilling pad upon which a well intended for eventual
production is located, all appurtenant facilities and activities
related thereto and all locations of water withdrawals used or
to be used to supply water to the project.” Id. Collier later
extended this regulation to “projects intended solely for
exploratory purposes.” Del. River Basin Comm’n,
Supplemental Determination of the Executive Director
Concerning Natural Gas Extraction Activities in Shale
Formations Within the Drainage Area of Special Protection
Waters 1 (June 14, 2010) (2010 Determination) (emphasis
omitted),
https://www.nj.gov/drbc/library/documents/SupplementalED
D6-14-10.pdf.4
B
Wayne Land and Mineral Group, LLC owns
approximately 180 acres of land in Wayne County,
Pennsylvania. Nestled in the northeastern part of the state, the
county shares with New York a border shaped by the
serpentine course of the upper Delaware River and its western
branch. Wayne purchased the property to access, via fracking,
valuable natural-gas reserves within the underground shale-
3
The “Special Protection Waters” cover “the entire 197-mile
non-tidal Delaware River from Hancock, N.Y. to Trenton,
N.J.” Special Protection Waters (SPW), Del. River Basin
Commission (Apr. 10, 2019),
https://www.state.nj.us/drbc/programs/quality/spw.html.
4
The parties dispute how to refer to these guidance documents.
In particular, the Senators refer to them collectively as the
“moratorium” or “de facto moratorium” on fracking in the
Basin. We will, however, continue to call them the
Determinations.
6
rock formations that have come to characterize this region.
However, because some of the land also lies within the Basin,
Wayne’s intended fracking activities are subject to the
DRBC’s claimed authority under the 2009 and 2010
Determinations.
In May 2016, Wayne sued the DRBC in federal court,
challenging the agency’s authority to regulate the company’s
proposed fracking activities. In particular, Wayne sought a
declaration that “the [DRBC] does not have jurisdiction over,
or the authority to review and approve, . . . [Wayne’s] proposed
well pad, appurtenant facilities or the related activities to be
carried out” on its property. JA99. Wayne argued that its
proposed well pad “does not constitute a ‘project’ under
Section 3.8 of the Compact,” and that, as a result, it was not
subject to the DRBC’s claimed project-review authority. JA97.
Several outside parties immediately sought to intervene
in the action under Rule 24. The Delaware Riverkeeper
Network and its leader, Maya K. van Rossum (collectively, the
Riverkeeper), were permitted to do so in September 2016 on
behalf of the DRBC. About a month later, Pennsylvania State
Senators Joseph B. Scarnati III, Gene Yaw, and Lisa Baker also
sought to intervene, but on the side of Wayne. Acting in their
official capacities, the Senators asserted that the “DRBC is
nullifying the General Assembly’s lawmaking power by
effectively countermanding the directives of duly enacted laws
that permit” various fracking-related activities. JA107. The
Senators sought “to protect the authority and legislative
prerogative of the Pennsylvania Senate and the Pennsylvania
General Assembly to regulate commercial activities in
Pennsylvania.” JA108. They did not specify the relief they
sought, however, saying only that “they intend to adopt in
whole [Wayne’s] complaint,” and attaching a copy of it to their
motion. JA113.
7
Both the DRBC and the Riverkeeper opposed the
Senators’ motion. Among other arguments, the Riverkeeper
contended that the Senators lacked standing to intervene
because they could not meet any of the three elements
established in Lujan v. Defenders of Wildlife, 504 U.S. 555,
560-61 (1992). The District Court denied the Senators’ motion
without discussing the Riverkeeper’s standing argument.
Rather, it held on the merits that the Senators had failed to
establish all the conditions necessary for intervention of right
under Rule 24(a), and it likewise declined to permit the
Senators to intervene under Rule 24(b).
A few months later, the District Court granted the
DRBC’s motion to dismiss. It rejected the agency’s arguments
regarding ripeness, standing, final agency action, and
exhaustion, but nevertheless dismissed the action sua sponte,
declaring it “apparent that [Wayne’s] proposed activities
within the Delaware River Basin constitute a ‘project’ within
the meaning of that term as defined in Sections 1.2(g) and
1.2(i) of the Compact.” JA296.
Wayne appealed. Our Court upheld the District Court’s
decision regarding the DRBC’s arguments, but concluded that
“the District Court erred when it decided that the
Commission’s project review authority under the terms of the
Compact unambiguously includes Wayne’s proposed
activities.” Wayne I, 894 F.3d at 533. We remanded for further
fact-finding as to the Compact drafters’ intent, cautioning that
our opinion should not be read as “adopting or endorsing either
Wayne’s interpretation or the [DRBC]’s, or anyone else’s.” Id.
On remand, the Senators again sought to intervene. This
time, they presented a unique proposed complaint, articulating
two grounds for relief. In Count I, they requested that the
District Court “invalidate the de facto moratorium and enjoin
8
its further enforcement,” JA424, arguing that it “violates the
terms of the Compact because it exceeds the scope of authority
ceded to the [DRBC] under the Compact,” JA421.
Alternatively, in Count II, the Senators requested an order that
the DRBC “provide just compensation for the deprivation of
the economic value of the property in question.” JA424.
According to the Senators, even if the Determinations are a
valid exercise of the DRBC’s authority, they nevertheless
constitute “a regulatory taking without just compensation”
under the Fifth Amendment. JA422.
The DRBC and the Riverkeeper again opposed the
Senators’ attempt to intervene. This time, however, neither
party contended that the Senators lack standing, resting their
arguments chiefly on the merits of the Senators’ motion. The
District Court agreed, denying the motion because the Senators
had not shown a “significantly protectable interest in th[e]
litigation.” JA41. The Senators timely appealed.
II5
The Supreme Court has repeatedly described the
question of Article III standing as a “threshold” issue. See, e.g.,
Va. House of Delegates v. Bethune-Hill, 139 S. Ct. 1945, 1951
(2019); Gill v. Whitford, 138 S. Ct. 1916, 1923 (2018); Horne
v. Flores, 557 U.S. 433, 445 (2009); Steel Co. v. Citizens for a
Better Env’t, 523 U.S. 83, 102 (1998). It is an “irreducible
constitutional minimum,” without which a court would not
have jurisdiction to pass on the merits of the action. Lujan, 504
5
The District Court’s and our jurisdiction is at issue here, and
“it is familiar law that a federal court always has jurisdiction to
determine its own jurisdiction.” In re Lipitor Antitrust Litig.,
855 F.3d 126, 142 (3d Cir. 2017) (quoting United States v.
Ruiz, 536 U.S. 622, 628 (2002)).
9
U.S. at 560. As a result, federal courts “have an obligation to
assure [them]selves of litigants’ standing under Article III.”
DaimlerChrysler Corp. v. Cuno, 547 U.S. 332, 340 (2006)
(citation and internal quotation marks omitted). Indeed, as we
have put it, “[o]ur continuing obligation to assure that we have
jurisdiction requires that we raise [the] issue[] of standing . . .
sua sponte.” Seneca Res. Corp. v. Township of Highland, 863
F.3d 245, 252 (3d Cir. 2017) (citation and internal quotation
marks omitted). We must “assess our own appellate
jurisdiction in the first instance.” Id.
These principles apply even when an individual seeks
to intervene under Rule 24(a)(2). In this context, as in any
other, standing is a “threshold issue.” Town of Chester, 137 S.
Ct. at 1648. “[A] plaintiff must demonstrate standing for each
claim he seeks to press and for each form of relief that is
sought.” Id. at 1650 (quoting Davis v. Fed. Election Comm’n,
554 U.S. 724, 734 (2008)). As a result, if a putative intervenor
of right “seeks additional relief beyond that which the plaintiff
requests,” then the intervenor “must demonstrate Article III
standing.” Id. at 1651. “Absent such a showing, exercise of its
power by a federal court would be gratuitous and thus
inconsistent with the Art. III limitation.” Id. at 1650 (quoting
Simon v. E. Ky. Welfare Rights Org., 426 U.S. 26, 38 (1976)).
The District Court in the present case therefore had a duty,
before passing on the merits of the Senators’ motion to
intervene, to determine whether the Senators must demonstrate
Article III standing—whether, that is, they seek relief
“different from that which” Wayne requests. Id. at 1651.
To be sure, in its denial of the Senators’ second motion
to intervene, the District Court did briefly confront this issue,
though not as a threshold inquiry but rather as part of its ruling
on the merits of the motion. The Senators, it noted, failed to
“address the broadened scope of the current litigation which
10
their [Proposed] Complaint presents.” JA36 (brackets in
original). The District Court distinguished between the two
counts of the Senators’ complaint. “It may be true,” the District
Court wrote, “that the relief sought in [Wayne’s] Complaint is
sufficiently similar to the relief sought in Count I of the
[Senators’] [Proposed] Complaint that the Senators need not
meet the standing criteria for that claim.” JA36 (third brackets
in original) (citations omitted). But as to Count II, “it is clear
that the Senators seek relief that is broader than” that requested
by Wayne. JA37 (alteration and internal quotation marks
omitted). As a result, the District Court, citing Town of
Chester, concluded that the Senators had failed to show “that
they are not required to satisfy standing criteria to support their
claim for intervention as of right.” JA37. Yet, despite this
conclusion, the District Court provided no further elaboration
on the standing issue.
III
Our review of the record indicates that, on both counts
of their proposed complaint, the Senators appear to be seeking
relief different from6 that sought by Wayne. We will discuss
each count in turn.
6
We clarify here at the outset that under Town of Chester,
“different from” does not necessarily mean entirely different
from. “For all relief sought, there must be a litigant with
standing”; a putative intervenor of right is therefore required to
demonstrate Article III standing not only in cases where the
relief it seeks is categorically distinct from that sought by the
plaintiff, but also in cases where the intervenor “seeks
additional relief beyond that which the plaintiff requests.” 137
S. Ct. at 1651 (emphases added).
11
A
As to the relief requested in Count I, the Senators
emphasize the District Court’s observation regarding its
similarity to the relief sought by Wayne. But they offer no
further reasoning as to why this observation is correct,
considering it “plain[]” that standing is “not at issue with
regard to the first count.” Appellants’ Reply Br. at 4.
The issue is not as clear as the Senators suggest.7 Their
proposed complaint provides differing formulations of the
relief they seek. For example, in their prayer for relief, the
Senators “respectfully request that this Court invalidate the de
facto moratorium and enjoin its further enforcement.” JA424;
see also JA423. Elsewhere, though, they suggest that they want
only declaratory relief under Count I. See, e.g., JA415, 422.
Perhaps recognizing the problematic nature of their prayer for
relief,8 the Senators emphasize this latter formulation in their
7
Apart from all else, the District Court’s statement is hardly
definitive. It said only that it “may” be true that the relief
sought by Wayne is “sufficiently” similar to the relief sought
under Count I of the Senators’ proposed complaint. JA36.
8
There are two problematic aspects in particular. First, there is
no indication that Wayne has requested injunctive relief. So if
such relief is an essential part of Count I, then the Senators—
whose very statement distinguishes between declaratory and
injunctive relief—must demonstrate Article III standing as to
that claim. See Steffel v. Thompson, 415 U.S. 452, 466 (1974)
(“Congress plainly intended declaratory relief to act as an
alternative to the strong medicine of the injunction.”); Alli v.
Decker, 650 F.3d 1007, 1014 (3d Cir. 2011) (“[D]eclaratory
relief will not always be the functional equivalent of injunctive
relief.”). Second, an invalidation of the 2009 and 2010
Determinations might conflict with our holding in Wayne I
12
reply brief: “As it relates to Count I, the redress or benefit the
Senators seek is a declaration that, under the Compact, the
[DRBC] lacks authority to institute a moratorium within the
Basin.” Appellants’ Reply Br. at 3 (internal quotation marks
omitted). For the purposes of this analysis, we will assume that
the Senators seek declaratory relief alone.
There are two aspects of the request worth noting. First,
it appears to challenge the DRBC’s authority under not simply
§ 3.8 of the Compact—the invoked basis for the 2009 and 2010
Determinations—but any provision of the Compact. See also,
e.g., JA415 (“The Senators seek a declaration [from] this Court
that the Delaware River Basin Compact . . . does not confer
concerning final agency action. The DRBC argued there that
the suit should be dismissed because the agency had not
reached a final decision on whether to block Wayne’s proposed
activities. After noting that the doctrine of final agency action
usually applies only under the Administrative Procedure Act,
we observed that “the question Wayne poses is not really one
of administrative law at all.” 894 F.3d at 525. “Wayne is not
asking for a review of an agency’s action. Wayne’s complaint
does not seek to invalidate [the Determinations].” Id. Instead,
we pointed out, Wayne is seeking a declaratory judgment on a
question of law: whether the term “project” under the Compact
covers its proposed activities. Id. at 525-26. According to the
Senators’ prayer for relief, however, invalidation of the
Determinations is precisely what they seek. Therefore, to the
extent the Senators wish to reframe the relief Wayne requests,
they are changing the nature of this action—rendering it one of
administrative law rather than of contract interpretation. If that
is the case, then the Senators need to establish Article III
standing because they would in effect be pressing a distinct
claim, seeking different relief.
13
jurisdiction on the Commission to implement or otherwise
enforce the moratorium.”). Second, the request challenges the
DRBC’s authority to institute a moratorium on fracking
activities within the Basin. The Senators therefore seem to
want a declaration not simply that the DRBC may not review
Wayne’s proposed fracking activities, but that it may not
review any firm’s fracking activities.
With these points in mind, we must now consider more
specifically Wayne’s requested relief. In its broadest
formulation, this relief would be a declaration:
that the [DRBC] does not have jurisdiction over,
or the authority to review and approve, or to
require [Wayne] to seek prior approval from the
[DRBC] for, or to otherwise preclude the
development of, [Wayne’s] proposed well pad,
appurtenant facilities or the related activities to
be carried out on the Property.
JA99. At first glance, this request could encompass more than
a challenge to the DRBC’s claimed authority in the 2009 and
2010 Determinations, bringing it, in that respect, in line with
the Senators’ requested relief. Nevertheless, there are two ways
in which it seems different from the relief the Senators seek.
First, the language tracks that of the 2009
Determination. In claiming review authority over “any natural
gas extraction project,” Executive Director Collier added that
“[f]or this purpose a project encompasses the drilling pad upon
which a well intended for eventual production is located, all
appurtenant facilities and activities related thereto and all
locations of water withdrawals used or to be used to supply
water to the project.” 2009 Determination at 2. The suggestion
(in a sense confirmed by the subsequent course of the
litigation) is that in mirroring Collier’s wording, Wayne is
14
specifically concerned with the 2009 and 2010 Determinations,
and therefore with the DRBC’s project-review authority under
§ 3.8 of the Compact, rather than with all of the DRBC’s
authority under the Compact. It is thus possible that, even if
Wayne prevailed, the result would nullify only the
Determinations’ claimed basis of authority, leaving open the
possibility that the DRBC might in the future exercise
alternative authority to regulate fracking in the Basin. See
Wayne I, 894 F.3d at 530 n.17 (emphasizing that “[w]e take no
position on whether [any other provision of the Compact]
provides the [DRBC] an alternative jurisdictional basis to
require advance approval of fracking activity”).
Second, Wayne’s requested relief refers specifically to
Wayne, rather than to any fracking firm. At the very least, this
raises factual issues regarding the precise nature of Wayne’s
proposed activities, the aspects of those activities that (should
Wayne prevail) fall outside the scope of the DRBC’s
regulatory authority, and whether a declaration as to those
aspects would in effect constitute a declaration that the DRBC
lacks the authority to review the proposed fracking activities of
any other firm. The Senators, as noted, are not concerned with
just Wayne’s problems: they appear to be looking to bar the
DRBC from interfering with the fracking activities of any firm
in the Basin. If so, and if Wayne’s requested relief is specific
to it, then the Senators must indeed establish Article III
standing as to Count I.
B
As the District Court acknowledged, Count II of the
Senators’ proposed complaint clearly demands different relief.
On appeal, the Senators make an interesting argument that in
effect Count II resolves into Count I under the canon of
constitutional avoidance. “Count II,” we are told, “seeks a
15
declaration that the Compact cannot be interpreted as
conferring the broad power claimed by the [DRBC] because
the exercise of such authority would violate the United States
Constitution, rendering the entire contract illegal.” Appellants’
Reply Br. at 5. Yet this neglects the very point at issue—the
nature of the relief sought. In their proposed complaint, the
Senators specifically request an order “directing the [DRBC]
to afford just compensation for the diminution of the economic
value of the property it has appropriated.” JA423. Wayne, by
contrast, has sought only declaratory relief. The Senators must
therefore establish Article III standing as to Count II of their
proposed complaint.
IV
Although this conclusion might recommend that we
next consider whether the Senators in fact have standing at
least as to Count II, we nevertheless think it appropriate to
remand the entire case to the District Court. The Senators’
arguments regarding that Count imply that the real goal of their
intervention lies with Count I. In Town of Chester, the Supreme
Court vacated and remanded because of an “ambiguous record
and the lack of a reasoned conclusion on [the standing]
question from” the lower court. 137 S. Ct. at 1652 n.4; see also
Laroe Estates, Inc. v. Town of Chester, 693 F. App’x 69, 70
(2d Cir. 2017) (“[R]esolving the ambiguity identified by the
Supreme Court is likely to require a factual inquiry that this
Court lacks the institutional capacity to perform.”). The same
two grounds apply here. The Senators insist that Count I seeks
only a declaration that the DRBC lacks the authority under any
provision of the Compact to regulate or bar fracking activities
in the Basin. Wayne might also be seeking such relief, but it is
at the very least unclear if a ruling for Wayne would apply to
the entire Compact rather than just § 3.8, and if it would
necessarily apply to the activities of other firms.
16
We think the District Court is best positioned to resolve
these questions, and any others that might appear, in the first
instance. Having overseen the litigation from the beginning, it
is most familiar with the unique circumstances of the case and
how they inform the nature of the relief sought. With the
standing issue squarely before it, the District Court should have
the opportunity to “offer the first word.” Nutraceutical Corp.
v. Lambert, 139 S. Ct. 710, 717 (2019); see also Frank v. Gaos,
139 S. Ct. 1041, 1046 (2019) (per curiam) (vacating and
remanding for the lower courts to resolve “the standing
question . . . in the first instance”); Cudjoe ex rel. Cudjoe v.
Dep’t of Veterans Affairs, 426 F.3d 241, 250 (3d Cir. 2005)
(remanding for the district court “to address the standing issues
in the first instance,” where standing was briefed by the parties
on appeal but not addressed by the district court).
V
For the foregoing reasons, we will vacate the District
Court’s order and remand for proceedings consistent with this
opinion.
17