(CN) - A federal agency may owe $200,000 to an environmental group that challenged a coal-mining permit on the Navajo Reservation, the 9th Circuit ruled Monday.
The Black Mesa Water Coalition, a coalition of Navajo and environmental groups, had gone to court in 2009 after the Federal Office of Surface Mining Control and Enforcement (OSM) approved a revision to Peabody Western Coal Co.'s permit to mine coal in northeastern Arizona.
After consolidating several similar challenges, an administrative law judge vacated the permit in 2010, agreeing that the agency had violated the National Environmental Policy Act (NEPA) and neglected to consider a proper range of alternatives in its environmental impact statement.
Black Mesa, considering itself the victor in the challenge, then petitioned the agency to recover some $206,000 in attorneys' fees, costs and expenses.
Disputing such relief, the OSM argued that the group was "neither 'eligible' for nor 'entitled' to fees under the Surface Mining Control and Reclamation Act," according to the 9th Circuit's summary of the case.
Now siding with the agency, the administrative law judge found that, among other things, consolidation of the various cases meant that no individual party had achieved success on the merits of its petition, and that Black Mesa "did not cause the determination of the issues."
Confirming that the group was not "entitled" to fees, the Interior Board of Land Appeals noted that Black Mesa lawyers had spent only 5.33 hours "conferring ... about NEPA issues" out of a total of 1,065 hours spent on the case.
U.S. District Judge G. Murray Snow in Phoenix affirmed, but the federal appeals court in San Francisco revived the group's claim on Monday.
The three-judge panel found that Black Mesa is indeed "eligible" for fees, as it achieved at least some degree of success in the case.
Declining to consider whether Black Mesa was also "entitled" to fees, the unanimous panel sent the case back to the Office of Surface Mining Control and Enforcement.
The "issue should be remanded for the agency to consider, because we cannot be sure how the agency will view substantial contribution when told that Black Mesa was in fact eligible for fees, contrary to the agency's prior rationale," Judge Ronald Gould wrote for the court.
Adding a few thoughts on the agency's current view on fees in consolidated cases, Gould said that the court had a "degree of discomfort with the possibility that unless parties sit down and agree to fight a fully-coordinated battle, then they must duplicate one another's arguments in each of their individual briefs to preserve entitlement to fees."
"Under the agency's rationale, this would appear to require increased litigation costs and expenses before parties could seek to recover their requested award amounts, forcing the agency, if unsuccessful on the merits of an administrative appeal, to pay for more extensive briefing, if in the end the agency awarded fees," he wrote. "It is more sensible to recognize that once a party has gained some degree of success on the merits, it may then be awarded fees only if it made a substantial contribution to a full and fair resolution of the issues, and that the amount of any fee award will be commensurate with its contribution to the result."