A group of land agents and energy companies cannot sue the federal government for rescinding drilling leases sold by the Bush administration around national parks in Utah because they missed a 90-day deadline to file the lawsuit, a federal appeals court ruled Wednesday.
The decision of the Denver-based U.S. 10th Circuit Court of Appeals appeared to end years of political and legal discord after the Obama administration upended an oil-and-gas auction held in the final months of President George W. Bush's administration. Weeks after President Barack Obama took office, his Interior Secretary Ken Salazar rescinded 77 lease parcels for oil and gas drilling, denying them to winning bidders.
Environmental groups said the auction would have allowed drilling to encroach on wild areas of Utah and despoil views from national parks. Oil industry executives insisted at least some of the parcels were far out of sight of any national park and had been open for leasing for years.
It was the same December 2008 auction in Salt Lake City where a Utah environmental activist jumped into the bidding to protest the sales and safeguard parcels around national parks. Tim DeChristopher — considered a folk hero in the environmental community — is serving two years in federal prison for disrupting the bidding.
DeChristopher ended up winning 14 drilling parcels for nearly $1.8 million, but he couldn't pay for them.
"This is really about the fact that the (Bush administration) offered leases in sensitive places such as the doorstep to Arches and Canyonlands national parks," said David Garbett, a staff lawyer for Southern Utah Wilderness Alliance.
The wilderness group and others went to court before the auction was held. They reached an agreement with federal lawyers to allow the auction to go ahead, but with the understanding a federal judge could issue a restraining order on parcels that were sold. That judge granted the request. Salazar followed up by freezing the leases indefinitely.
Another lawsuit was filed by winning bidders on the merits of Salazar's decision. That case was dismissed, however, because the land agents and energy companies had missed a deadline to file the lawsuit by six days.
In Wednesday's decision, two appeals court judges ruled the winning bidders had, in fact, missed the deadline — a third judge found otherwise. It left the winning bidders without a single ruling on the merits of Salazar's decision.
One of the plaintiffs, Denver-based Questar Exploration & Production Co., has argued that every one of the yanked parcels was adjacent to an existing and valid lease parcel. The company has insisted that none of the parcels was closer than about 15 miles to a national park.
The company, now known as QEP Resources Inc., says the "conflicting rationales" offered by the three-judge panel could persuade the full U.S. 10th Circuit Court of Appeals to take up the case. QEP said the two judges who ruled that the plaintiffs missed the deadline offered different versions of the deadline.
The company said Salazar confused things by claiming his decision was made in an internal memorandum instead of a formal notice six days later.
"This decision sets a disturbing legal precedent, one where internal correspondence between government bureaucrats constitutes public notice," QEP said Wednesday.
Environmentalists said the main point is that a questionable auction was halted in its tracks.
"A new administration came to its senses," Garbett said Wednesday. "It's good to know that this correction will remain in place."
A spokesman for Salazar didn't return a phone call from the AP. The Western Energy Alliance, a Denver-based trade group that supported the bidders' lawsuit, had no immediate reaction.