Major Federal Decision

On Feb. 10, the U.S. 9th Circuit Court of Appeals upheld a consent decree that had settled a lawsuit between Los Angeles County, CEMEX Inc., and the United States, allowing a major mining project on federal lands to go forward. Kerry Shapiro, a partner at Jeffer, Mangels, Butler & Marmaro LLP who was lead counsel for CEMEX, believes the decision could have broad implications for all projects on federal lands. "The decision helps to establish that local governments can go too far in the name of local regulation and be preempted from interfering with projects on federal land,” he said.

The City of Santa Clarita, where the project was based, bitterly opposed CEMEX's Soledad Canyon Sand and Gravel Mining Project - the largest federally-contracted sand and gravel project in the history of the United States - and was instrumental in the County’s denial of the deal despite that it was on property owned by the U.S. Bureau of Land Management and had secured the appropriate federal approvals.

On behalf of CEMEX, Shapiro and his team sued the County successfully, arguing that the local government's delays in conducting environmental reviews and subsequent denial of the project were preempted by federal mining laws and BLM decisions. Under the consent decree, the County agreed to rescind its denial and complete its environmental review. Two months later, the County approved the project and issued the surface mining permit. The City of Santa Clarita, in its continuing effort to stop the project, appealed the consent decree.

Within days of the case’s oral argument, the 9th Circuit Court of Appeals ruled unanimously that the settlement was negotiated in good faith, is "fundamentally fair, adequate and reasonable" and that CEMEX had made a “plausible” case that further County review was preempted. Your comment?