Archives: April 2021

Supreme Court of the U.S. Holds that Draft Biological Opinions that are Pre-decisional and Deliberative Are Protected from Disclosure Under FOIA By the Deliberative Process Privilege

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On March 4, 2021, the Supreme Court of the United States in United States Fish and Wildlife Service v. Sierra Club, Inc. (2021) 141 S.Ct. 777, in an opinion written by newly appointed Justice Barrett and joined by Justices Roberts, Thomas, Alito, Kagan, Gorsuch, and Kavanaugh, reversed in part the Ninth Circuit Court of Appeals’ decision in holding that the deliberative process privilege protects Draft Biological Opinions (B.O.s) from disclosure under the Freedom of Information Act (FOIA) if the Draft B.O.s are pre-decisional and deliberative, even if they represent an agency’s last views on a proposed action.

BACKGROUND

In 2011, the U.S. Environmental Protection Agency (EPA) proposed a rule on the design and operation of cooling water intake structures intended for use in industrial facilities, to make use of technology to minimize adverse environmental impacts. (See 79 Fe. Reg. 22174 (2001).) Even still, these cooling structures would kill a certain amount of fish and other aquatic species, some of which might be federally protected (threatened or endangered). Accordingly, under Section 7 of the Endangered Species Act (ESA), the EPA consulted with the U.S. Fish and Wildlife Service (USFWS) and the National Marine Fisheries Service (NMFS), both of which began preparation of Draft B.O.s in order to make their jeopardy determinations, i.e., whether or not the EPA’s proposal would jeopardize the continued existence of a protected species. Informal consultation with these agencies began in 2012 and formal consultation began in 2013. Multiple documents were exchanged between agencies during this time.

In November 2013, the EPA revised its proposed rule in response to consultation, and USFWS/NMFS tentatively agreed to provide the EPA with their Draft B.O.s by December 6th and Final documents by December 20th. Both Draft B.O.s concluded that the proposed rule likely would jeopardize protected species. Neither agency formally approved their Draft B.O. or presented them to the EPA by the deadline and, instead, both agencies concluded that more work needed to be done. As well, the EPA was still internally debating its rule, therefore all parties agreed to extend the period of consultation.

By March 2014, the EPA had revised its proposed rule again from the 2013 version, in a manner that allowed USFWS/NMFS to issue a joint no-jeopardy determination, after which the EPA issued its final rule that same day. Sierra Club made FOIA requests to USFWS/NMFS regarding their consultation on this rule, and both agencies invoked the deliberative process privilege for the Draft B.O.s of EPA’s 2013 proposed rule. Sierra Club sued in the Northern District of California, and won on this issue. The Ninth Circuit affirmed the trial court’s decision on this issue. The Supreme Court grant certiorari.

ANALYSIS

FOIA mandates the disclosure of documents held by federal agencies upon request unless one of nine exemptions apply. One such exemption is the deliberative process privilege, which protects documents from FOIA requests if they reflect an agency’s preliminary thinking about an issue, as opposed to its final opinion. The deliberative process privilege exists to encourage agency candor so as to improve decisionmaking and avoid the “chilling effect” that can occur when an agency believes its internal discussion may be made public. Pre-decisional, deliberative documents are exempt from disclosure under this privilege, whereas documents indicating final agency opinion must be disclosed. This does not mean, however, that the last document prepared by the agency is necessarily a final document.  As Justice Barrett put it, sometimes a document does not present a final opinion upon which an agency has settled and is only considered final at all because nothing else follows it, because the proposed action upon which it is based “dies on the vine.” Further, whether or not the agency producing the document treats it as final is a primary determining factor.

Here, the Sierra Club contended that the 2013 Draft B.O.s, with their jeopardy determinations, must be considered final under prior precedent because they forced the EPA to change its rule in response. According to Justice Barrett, however,  the precedent cited by Sierra Club was inapposite and the Draft B.O.s prepared in response to the EPA’s 2013 proposed rule were simply draft documents that “died on the vine” when the EPA changed its rule in 2014, and did not represent final agency opinions. She reasoned that, because the 2013 Draft B.O.s were not made available to the EPA, they were still “subject to change.” Even if they had been made available to the EPA, existing regulations would still allow them to be revised. Justice Barrett further found that the gap in time between due dates for the 2013 Draft B.O.s and their Final counterparts indicated their deliberative nature, for why would there be a two-week gap between draft and final unless revisions were anticipated? Mostly though, the court relied on the fact that neither the USFWS nor NMFS had finalized their 2013 Draft B.O.s—they were unapproved by agency decisionmakers and not forwarded to the EPA—as evidence showing that the agencies did not view them as final and thereby proving their lack of finality. These documents then were not really Draft B.O.s but instead were “drafts of draft[s].” They may have contained the last words on the 2013 proposed rule but were not intended to be final.

DISSENT

Justice Breyer penned a dissent, joined by Justice Sotomayor, in which he questioned the majority’s position that the documents were “drafts of drafts,” and asserted that Draft B.O.s do not normally “enjoy” the deliberative process privilege. The dissent preferred a more in-depth factual analysis to determine finality of the documents, and would have liked the question remanded to allow the Ninth Circuit to determine exactly how much more work needed to be done on the draft documents to establish whether they were closer to draft or final documents. Justice Breyer also noted the long agency history of disclosing Draft B.O.s to the public.

– Casey Shorrock

First District Holds that Deficiencies in Notice Did Not Excuse CEQA Litigants from Exhausting Available Administrative Remedies

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The First District Court of Appeal in Schmid v. City and County of San Francisco (Feb. 1, 2021) 60 Cal.App.5th 470, held that Appellants’ CEQA claims were barred by their failure to exhaust available administrative remedies, even where deficiencies in the notice excused the litigants from satisfying the exhaustion requirements under Public Resources Code section 21177.

BACKGROUND

The “Early Days” statue, located in San Francisco’s Civic Center, is part of the “Pioneer Monument”—a series of five bronze sculptures memorializing the pioneer era when California was founded. The statue depicts three figures, including a reclining Native American over whom bends a Catholic priest. Public criticism has surrounded the statue since its installation in 1894.  

In 2018, after charges of the statue’s racial insensitivity resurfaced, the San Francisco Arts Commission and the San Francisco Historic Preservation Commission (HPC) granted a Certificate of Appropriateness (COA) to remove the statue and place it in storage. In granting that approval, the HPC determined the removal of the statue was categorically exempt from CEQA. There were no issues raised at the HPC hearing about a perceived need for environmental review. Nor were there any appeals of HPC’s CEQA determination to the San Francisco Board of Supervisors. 

Appellants, two opponents of the statue’s removal, appealed the HPC’s adoption of the COA to the San Francisco Board of Appeals. The Board of Appeals initially voted to overturn the COA, but later had it reinstated. After the Board of Appeals approved the COA, the City immediately removed the statue the following morning. 

Appellants filed suit seeking to overturn the Board of Appeals’ order authorizing removal of the statue. They alleged violations of constitutional and statutory law, including CEQA. The trial court sustained a demurrer without leave to amend. On the CEQA claims, the trial court found Appellants failed to exhaust available administrative remedies. Appellants appealed.

COURT OF APPEAL’S DECISION

Exhaustion of Administrative Remedies
The Court of Appeal explained that CEQA litigants must comply with two exhaustion requirements. First, Public Resources Code section 21177 requires that a would-be CEQA petitioner must object during the administrative process and that all allegations raised in the litigation must have been presented to the agency before the challenged decision is made. Second, a would-be CEQA petitioner must exhaust all remedies that are available at the administrative level, including any available administrative appeals. Under Public Resources Code section 21151, a CEQA determination made by a nonelected decision-making body of a local agency may be appealed to the agency’s elected decision-making body, if any. The CEQA Guidelines encourage local agencies to establish procedures for such appeals. As relevant here, the San Francisco Administrative Code requires that appeals of CEQA determinations must be made to the Board of Supervisors, as the body of elected officials responsible for making final CEQA determinations.

The Court of Appeal found Appellants failed to comply with both exhaustion requirements. They did not object to the HCP’s determination that the project was categorically exempt from CEQA during the administrative process and they did exhaust administrative appeals available under the San Francisco Administrative Code. Specifically, on the second point, although Appellants appealed the HPC’s decision to the Board of Appeals, they failed to exhaust available remedies because they did not separately appeal the HPC’s CEQA determination to the Board of Supervisors, as required under the City’s Code.

Appellants argued they were excused from both exhaustion requirements because the City failed to provide adequate notice. The court agreed with Appellants in part, finding that Appellants were not required to comply with the statutory exhaustion requirements in section 21177 because there was no notice in advance of the HPC meeting that a categorical exemption might be on the agenda. But, the court explained, the inadequate CEQA notice did not excuse Appellants from complying with the requirement in the City’s Code that CEQA determinations must be appealed to the Board of Supervisors. The court also noted that Appellants had notice of the HPC’s CEQA determination because they appealed it, improperly, to the Board of Appeals. Because Appellants failed to appeal the CEQA determination to the appropriate body, they forfeited their right to bring a CEQA action.

Futility Argument
Appellants also argued they should be excused from exhausting their administrative remedies because doing so would have been futile. Citing a Board of Supervisors resolution that was not in the record, Appellants argued that an appeal to the proper board would have been futile because the Board of Supervisors already adopted a definitive position that the statue should be taken down. The court rejected this argument, stating that even if the Board of Supervisors held this view as a policy matter, it still could have disagreed with the process of removal and opted for an EIR. In addition, the Court concluded that the Board of Supervisors was never presented with any arguments concerning the appropriateness of a categorical exemption, and thus any argument regarding how the Board of Supervisors would have responded was pure speculation.

– Veronika Morrison 

Sixth District Holds City’s Failure to Send Notice of Determination Did Not Excuse Plaintiff’s Failure to Name Indispensable Party Within Limitations Period

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The Sixth District Court of Appeal in Organizacion Comunidad de Alviso v. City of San Jose (Feb. 9, 2021) 60 Cal.App.5th 783, held that the City of San Jose’s failure to send a Notice of Determination to a member of the petitioner organization, in violation of Public Resources Code section 21167, subdivision (f), did not excuse the petitioner’s failure to name an indispensable party in a CEQA action before the statute of limitations expired.

BACKGROUND

A light industrial center project was planned for construction on a primarily fallow farmland site in San Jose. Mark Espinoza, a member of the petitioner organization, Organizacion Comunidad de Alviso, requested that the City’s environmental project manager place him on the list to receive the Notice of Determination (NOD) for the Project.
Later that month, Microsoft Corporation purchased land from the original owner and took over as the project applicant. The San Jose City Council initially approved the project and associated EIR at an October 2017 meeting. The meeting agenda incorrectly referenced the previous landowner instead of Microsoft. Microsoft was, however, correctly referred to as the project applicant at the hearing. A second meeting was held to reconsider the project approval and EIR in December 2017. The notice for that hearing correctly identified Microsoft as the property owner, but the resolution approving the project incorrectly referenced the previous owners.

The City filed two NODs for the project. The first NOD, which was sent to Espinoza, listed the wrong project applicant. The City later realized the mistake and issued a second NOD that correctly listed Microsoft as the applicant. The City did not send Espinoza the second NOD.

The petitioner filed a petition for writ of mandate within 30 days of the first NOD, alleging violations of CEQA and the Planning and Zoning Law. The petition named the previous property owners as real party in interest, based on the information in the first NOD. Two weeks after the 30-day statute of limitations for the CEQA cause of action expired, the previous owners’ attorney notified the petitioner’s counsel that Microsoft had acquired the property and was named as the applicant in the second NOD. A month after receiving this notice—and well after the 30-day limitations period had run—the petitioner filed an amended petition naming Microsoft as a real party in interest.

Microsoft and the City demurred to the CEQA action in the amended petition, arguing that it was time-barred because petitioner failed to name Microsoft as the real party in interest before the limitations period expired. The trial court determined that the initial petition was defective for failing to join Microsoft, and consequently dismissed the CEQA cause of action as untimely.

COURT OF APPEAL’S DECISION

Failure to Name Applicant in NOD as Real Party in Interest
Under Public Resources Code section 21167.6.5, subdivision (a), in addition to naming as a defendant the agency that approved the project, a petitioner must name as a real party in interest the “person or persons identified by the public agency” in the NOD. Here, the petitioner did not dispute that Microsoft was a necessary and indispensable party under CEQA because it was named as the applicant in the NOD. Instead, the petitioner argued that its failure to name Microsoft should be excused because the NOD sent by the City named the wrong party and the City did not resend the new NOD after the error was corrected. The court disagreed.

Although the court acknowledged the City violated Public Resources Code section 21167, subdivision (f), by failing to send the second, corrected NOD to Espinoza, it concluded that CEQA contains no relief for the City’s violation. The court ruled that the City’s violation could not excuse or cure the amended petition’s untimeliness because Public Resources Code section 21167, subdivision (f), itself provides that the “date upon which [the NOD] is mailed shall not affect” the statute of limitations. The court also cited the Supreme Court’s emphasis that potential CEQA litigants must pay close attention to NOD filings before initiating litigation.

Additionally, the court reasoned that the second NOD was properly filed with the county clerk, posted at the county clerk’s office, and made available for review by all potential litigants—thereby providing constructive notice of the correct parties to name in a potential action. The court further noted that petitioner had actual notice of Microsoft’s status as the applicant because it had participated in the public hearings at which Microsoft was identified and the public notice for the City’s re-approval hearing listed Microsoft as the owner.

Because the petitioner failed to name Microsoft within the 30-day statute of limitation period after the corrected NOD was filed, the court held that the trial court’s dismissal was appropriate.

Material Defect
The petitioner also argued that the 30-day statute of limitations was not triggered because the NOD was materially defective, and therefore, the 180-day limitations period should apply. The court easily rejected this argument because the petitioner did not claim that the second NOD was insufficient or incorrect. The petitioner only claimed that the posting of two contradictory NODs essentially amounted to an NOD defect. The court disagreed, determining that the second NOD contained all required information and was therefore not defective.

Relation-Back Doctrine
The court also disagreed with the petitioner’s argument that the relation back doctrine under Code of Civil Procedure section 474 should apply. The court determined the petitioner’s ignorance of Microsoft’s status as the project applicant was unreasonable because the second NOD was correct and provided constructive notice of Microsoft’s identity. Additionally, the petitioner had received actual notice of the second NOD from the former owners’ attorney and still proceeded to wait two months to file its amended petition—a delay, which the court pointed out, was longer than even the initial limitations period.

Estoppel
Finally, the court rejected the petitioner’s argument that the City and Microsoft should have been equitably estopped from asserting the statute of limitations defense. It concluded that even if the City’s failure to send Espinoza the second NOD was intentional, the petitioner’s reliance on that failure would be unreasonable. Again, the City’s timely filing of the second NOD with the county clerk’s office gave all potential litigants constructive notice of the correct parties to name in a CEQA action.

– Veronika Morrison