Thursday, December 8, 2011

Casitas Dismissed

For water law geeks, this week brought some big news.  On Monday, the Judge Wiese of the Court of Federal Claims dismissed Casitas Municipal Water District v. United States.  The case was arguably the highest profile water rights/takings case working its way through state or federal courts.  Now it’s over, at least until the next appeal.

Saying the case was factually and legally complex is a bit like describing War and Peace as a long book, so I’ll spare you most the details.  In essence, the Casitas was arguing that the Endangered Species Act caused a taking of its water rights.  The federal government’s first line of defense was an argument that the taking should be analyzed as a regulatory taking under the Penn Central framework.  Judge Wiese (who previously had authored Tulare Lake Water Basin Storage District v. United States, 49 Fed. Cl. 313 (2001)) accepted that argument, albeit rather grudgingly, but the Federal Circuit reversed.  That forced the United States and its allies to use several backup arguments. 

One of those arguments, which ultimately carried the day, was that Casitas had suffered no taking because the restrictions had never limited Casitas’s ability to put water to beneficial use.  Casitas’s ability to divert water had been limited, and Casitas argued that the extent of the taking should be measured by subtracting the amount of water it actually did divert from the amount it claimed it could have diverted had there been no restriction, and then multiplying that total by the value of the water.   By that method, Casitas produced a $87,300,000 takings claim, which even in the world of western water is no small sum.  The government, however, pointed out that Casitas operates a large reservoir, which had allowed it to weather the restrictions without ever limiting service to anyone.  Casitas, in other words, was asking for compensation for water its customers hadn’t even tried to put to use.  Because putting water to beneficial use is an essential element of an appropriative water right, the court held that Casitas had not yet suffered a taking, and that its claim therefore was unripe.

The government also tried a background principles/public trust defense, and that didn’t fare so well.  Without getting too far into the details (the opinion contains a more detailed discussion of California’s public trust doctrine than any published decision in decades), here’s the summary: the court held that while Casitas’ water use did adversely affect public trust resources, and while the feds had acted to protect those public trust resources, the public trust doctrine did not provide the federal government with a defense, because it wasn’t clear that the federal government’s actions were in the public interest.  Yet, interestingly, the court also stated (in an extended advisory section explaining exactly how the court would go about deciding a ripe future claim) that the California State Water Resources Control Board can invoke the public trust doctrine and change Casitas’s water rights if it pleases.

That’s intriguing.  What the court seems to be saying is that even though courts and the California State Water Resources Control Board have concurrent jurisdiction to implement the public trust doctrine, the Board has broader discretion to invoke the doctrine as a basis for environmental protection, and could even overrule the court’s application of the doctrine to this set of facts.  In a strange sense, it’s almost like Chevron or Brand X for the public trust doctrine, with the court granting an agency much broader latitude in interpreting and applying legal doctrine than the court claims for itself (at least if that excercise of discretion involves tinkering with existing water use practices).  To administrative lawyers, that may seem rather unsurprising, for most environmental law works that way.  But the public trust doctrine has traditionally been thought of as a judicially-defined doctrine, and an opportunity, as Joe Sax long ago put it, for “effective judicial intervention.”  The Court of Claims seems to have been rather uncomfortable with that approach.

If you’re interested in knowing more, I highly recommend reading the decision.  I do not agree with all of it, but I found it well written, carefully reasoned, and thorough, and I think water lawyers will be discussing it for a long time.  Also, keep an eye out for an upcoming UC Davis Law Review symposium issue on the public trust doctrine.  Several articles, including one that I’m now scrambling to update, will discuss these very issues.

-Dave Owen

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