Wind Energy Law Alert: Federal Court Halts Wind Project to Protect Indiana Bat
12/17/2009

Case Background

In June 2009, the Animal Welfare Institute and others ("Plaintiffs") filed a lawsuit in the Maryland Federal District Court seeking an injunction to halt construction of the Project. Animal Welfare Institute v. Beech Ridge Energy LLC, Case No. RWT 09cv1519 (D. Md.). The gist of the Plaintiffs' lawsuit was that the Project will unlawfully "take" Indiana bats in violation of the ESA. The Plaintiffs asserted that the Project could not lawfully move forward without an incidental take permit ("ITP") issued under Section 10 of the ESA, and alleged that the Defendants "proceeded with construction activities at a precipitous pace, despite plaintiffs' repeated and detailed notice prior to construction that these activities constitute violations of the ESA." The Defendants generally denied the Plaintiffs claims, asserting that pre-project studies demonstrated that no Indiana bats occupy the areas in or near the Project's location. A four-day trial was held at the end of October 2009, and a detailed 74-page ruling in favor of the Plaintiffs was issued on December 8, 2009.

ESA Provisions Relevant to Wind Project Development

Section 9 of the ESA makes it unlawful to "take" (intentionally or incidentally) an endangered species. Under the ESA, "take" means to "harass, harm, pursue, hunt, shoot, wound, kill, trap, capture, or collect [a listed species], or to attempt to engage in any such conduct." The incidental take of an endangered species can be authorized under the ESA in two ways: (1) through an "incidental take statement" ("ITS") issued via a Section 7 consultation, or (2) through an ITP issued under Section 10.

Section 7 of the ESA requires federal agencies to consult with either the United States Fish and Wildlife Service ("FWS") or the National Marine Fisheries Service ("NMFS") to ensure that "federal actions" are not likely to "jeopardize" protected species or adversely affect the critical habitat of those species. Typically, a "federal action" is an action that requires a federal permit, but it may also include actions that receive federal funding and are subject to a certain level of federal control. A Section 7 consultation normally results in the issuance of a biological opinion by FWS or NMFS. The biological opinion may include an ITS, which authorizes the permittee to incidentally take a specified number of listed animals.

Alternatively, a project proponent may obtain incidental take authorization through the issuance of an ITP under Section 10 of the ESA. Section 10 provides an exception to Section 9's take prohibition, in which an applicant can apply for a permit authorizing a take if such taking is "incidental to, and not the purpose of, carrying out an otherwise lawful activity." A project need not have a "federal nexus" to receive Section 10 take authorization. Significantly, an ITP must be accompanied by a habitat conservation plan ("HCP") that is completed by the permit applicant and approved by FWS. The process for developing and completing an HCP can be time consuming and, as a general matter, project proponents opt for the issuance of an ITS under Section 7 instead of engaging in the Section 10 process.

Like many wind projects, the Beech Ridge project required no federal permits and does not have a federal nexus. Thus, any incidental take caused by the project would need to be authorized by a Section 10 permit to avoid a violation of the ESA.

Judge Titus' Ruling

First ruling that the ESA provides for injunctive relief to prevent future actions that will take listed species, Judge Titus considered (1) the requisite degree of certainty under the ESA that a take would occur and (2) whether, under that standard of certainty, the evidence demonstrated that the Project would take Indiana bats.

After providing a thorough evaluation of the relevant case law addressing the ESA's evidentiary standard, Judge Titus ruled that a plaintiff asserting a Section 9 claim "must establish, by a preponderance of the evidence, that the challenged activity is reasonably certain to imminently harm, kill, or wound the listed species." The judge then proceeded to examine whether the evidence presented by the parties and their expert witnesses met this evidentiary standard.

Considering all the evidence, Judge Titus first held that Indiana bats were present in the vicinity of the Project. While there was little direct evidence of Indiana bats sighted at the Project site, the judge found that (1) hibernacula (caves used for hibernating) were located near the Project site (within 6-10 miles), (2) the physical characteristics of the Project site made the presence of Indiana bats more likely, and (3) acoustic evidence taken at the Project site suggested by that Indiana bats were present. Concluding that Indiana bats were present at the Project site, Judge Titus then found that there was a "virtual certainty" that Indiana bats would be imminently harmed or killed by the Project. Here, the judge rejected the Defendants' assertion that bats would not fly high enough to encounter wind turbines, deferring to the Plaintiffs' experts, who opined that bats would fly high enough to be harmed by the turbines. Judge Titus concluded that injunctive relief was warranted and that the only way the project could continue was with the issuance of an ITP issued under Section 10 of the ESA.

Implications

Wind project proponents may face similar challenges for projects sited in or near areas occupied by a species listed under the ESA. For projects that may incidentally take listed species, project proponents may be faced with the option of obtaining an ITP under Section 10 of the ESA or obtaining an ITS through a Section 7 consultation. As indicated above, the latter is generally a more efficient process; however, many wind projects have no federal nexus and thus no Section 7 "trigger." Project proponents should carefully examine their project to determine whether or not there is, in fact, a Section 7 trigger. If not, the project proponent should consider other options such as negotiating a Section 10 HCP/ITP process with the FWS that allows the project to move forward in a timely fashion or incorporating the use of Avian and Bat Protection Plans.

Additionally, Judge Titus' opinion is notable for the fact that it was harshly critical of the manner in which the project proponent's consultant handled the permitting of the project. The judge criticized the project consultants for disregarding recommendations made by the FWS, performing less-than-thorough surveys, and failing to analyze certain data. The judge also generally criticized the project proponents for failing to pursue a Section 10 permit and instead relying on incomplete data to take the position that the project would not harm bats.

Wind project proponents can avoid severe decisions such as that issued by Judge Titus by performing diligent site assessments for the presence of protected species, working cooperatively with FWS personnel, hiring qualified and thorough consultants, and obtaining counsel with specific experience in the intricacies of the ESA permitting framework and wind project development in general.

For more information on the issues presented in this alert, please contact:

Greg Corbin at (503) 294-9632 or gdcorbin@stoel.com
Barbara Craig at (503) 294-9166 or bdcraig@stoel.com
Bill Holmes at (503) 294-9207 or whholmes@stoel.com
Cherise Oram at (206) 386-7622 or cmoram@stoel.com
Ryan Steen at (206) 386-7610 or rpsteen@stoel.com