Mining Co. Loses Dispute Over Stonewash Pumice

(CN) - The 10th Circuit rejected a mining company's challenge of the noncompliance notice it received from the U.S. Forest Service for mining too many rare, large pumice pieces and selling them to industries other than the garment industry, which uses the pumice to stonewash jeans.

Copar had leased 23 mining claims in New Mexico's Santa Fe National Forest from the Cook family in the 1980s.

In 1993, Congress passed a law to create the Jemez National Recreation Area, barring mining on 57,000 acres, including the land mined by Cobar.

The Cooks filed, and partially won, a takings claim against the government. The Forest Service conceded that four of the 23 mining claims contained "valuable and marketable" three-quarter-inch pumice, which could be used to stonewash jeans. The remaining claims were deemed null and void, because they contained no valuable mineral deposit.

The Forest Service paid $4 million to settle the takings claims, and the Cooks and Copar relinquished the remaining 19 claims, which contained only run-of-the-mill pumice that can't be used for stonewashing.

The three-quarter-inch pumice is restricted almost exclusively to the garment industry, which uses it to abrade denim fabric to create a worn or "stonewashed" look. Larger pumice pieces can be sold for more than four times the price of smaller pumice.

The Forest Service approved a 10-year operational plan for mining of the larger pumice, which stipulated that Copar couldn't mine smaller pieces of pumice for common variety uses.

In 2003, after suspecting that Copar was selling its pumice for ordinary use, the Forest Service asked the mining company to verify that the pumice ended up in the stonewash laundry industry.

Copar refused to do so and challenged the agency's notice of noncompliance. Copar argued that it had not violated the agreement, because it mined only larger pumice pieces, even if it crushed the pumice and sold it for less.

The Denver-based federal appeals court upheld a lower court's refusal to review the Forest Service's notice of noncompliance.Judge Mary Beck Briscoe rejected Copar's claim that the requirement to show proof of end use is "impractical and oppressive," saying end use could be easily determined by the price at which the mineral was sold.

And because the Forest Service must ensure that mining operations minimally harm the environment, the court added, the agency reasonably concluded that Copar "used and destroyed more surface resources than the company was allowed to consume."

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