Utah Federal Judge: ESA Rule Is Unconstitutional

In a ruling that, if upheld and followed, would significantly limit the reach of federal environmental regulation, a Utah federal judge determined that regulation of a purely intrastate species listed as threatened under the Endangered Species Act is unconstitutional because it is beyond the scope of the Commerce Clause and the Necessary and Proper Clause. People for the Ethical Treatment of Property Owners v. U.S. Fish & Wildlife Serv., No. 2:13-cv-00278-DB (D. Utah Nov. 4, 2014) (“PETPO”).

Under section 4(d) of the Endangered Species Act (“ESA”), the government may add certain protections for threatened species, essentially providing the same protections afforded to endangered species under the Act. At issue in the PETPO case was whether the U.S. Fish & Wildlife Service may implement section 4(d) protections for the Utah prairie dog, which is listed as threatened under the ESA but is found solely within Utah’s borders.

No Substantial Effect on Interstate Commerce

The government conceded that the Utah prairie dog is a purely intrastate species, residing only in Utah, but nonetheless pointed to a long line of circuit court decisions that upheld regulation of intrastate species on Commerce Clause grounds. In those cases, the courts looked to the effect of the species in question on interstate commerce.

The court in PETPO broke rank, holding that it is the regulated activity—in this case the take of the species—that must be the touchstone for the interstate commerce effects. On that basis, the court ruled that the “substantial effects” test should not focus on the section 4(d) special rule’s effect on interstate commerce, but on the effect on interstate commerce caused by take of the Utah prairie dog. PETPO, at *16.

In reaching his conclusion, Judge Dee Benson determined that the species’ biological value was “inconsequential” to this determination. Id. at *11. Although conceding that the Utah prairie dog may have an effect on the ecosystem, Judge Benson, quoting Judge David Sentelle of the Court of Appeals for the District of Columbia Circuit, noted that the Commerce Clause “empowers Congress ‘to regulate commerce’ not ecosystems.” Id. at *12 (quoting National Ass’n of Home Builders v. Babbitt, 327 U.S. App. D.C. 248, 272 (D.C. Cir. 1997) (Sentelle, J., dissenting)).

The Court went on, stating that any purported commercial value of the Utah prairie dog is “too attenuated to support the premise that take of the prairie dog would have a substantial effect on interstate commerce.” Id. Similarly, the court concluded that related scientific research was also too attenuated to establish a “substantial relation between the take of the Utah prairie dog and interstate commerce.” Id.

Not Necessary and Proper to Achieve Congress’ Goal

The court also rejected the government’s argument that the Necessary and Proper Clause authorizes rule 4(d) because the rule is essential to the economic scheme created by the ESA. The court acknowledged that the ESA regulates economic activity, but held that rule 4(d) “is not necessary to the statute’s economic scheme.” PETPO, at *15. The court reasoned that “takes of Utah prairie dogs on non-federal land—even to the point of extinction—would not substantially affect the national market for any commodity regulated by the ESA.” PETPO, at *14. The court dismissed out of hand any substantial effects on national markets based on the fact that other interstate species, such as bobcats, golden eagles, and hawks, prey on the prairie dog.

Further, the court rejected the government’s argument that the take of all intrastate non-commercial species could be aggregated to satisfy the Necessary and Proper Clause, finding that aggregate take of different species did not apply to its consideration of the constitutionality of a special rule affecting only one species. On these bases, the court ruled that striking down the special rule would not undercut the ESA’s comprehensive regulatory system and was therefore not justified by the Necessary and Proper Clause.

Ruling Poised for Appeal

Given the litany of federal appeals court cases holding that regulation of purely intrastate species is within Congress’ constitutional authority, and in view of some of the reasoning put forth by the court and the potentially far-reaching implications of the decision, it would appear likely that the government will choose to appeal. See San Luis & Delta-Mendota Water Authority v. Salazar, 638 F.3d 1163 (9th Cir. 2011) (applying ESA to Delta smelt living only in California); Alabama-Tombigbee Rivers Coalition v. Kempthorne, 477 F.3d 1250 (11th Cir. 2007) (Alabama sturgeon living only in Alabama); Rancho Viejo, LLC v. Norton, 323 F.3d 1062, 1069 (D.C. Cir. 2003) (arroyo toad living only in California); GDF Realty Investments, Ltd. v. Norton, 326 F.3d 622 (5th Cir. 2003) (six species of subterranean, cave-dwelling invertebrate spiders and beetles living only in Texas); Gibbs v. Babbitt, 214 F.3d 483 (4th Cir. 2000) (red wolf living only in North Carolina); Nat’l Ass’n of Home Builders v. Babbitt, 130 F.3d 1041 (D.C. Cir. 1997) (Delhi Sands flower-loving fly living only in California).  

However, and notwithstanding the array of appellate rulings to the contrary, it is noteworthy that the district court’s reasoning in PETPO is not dissimilar to the view that then-Judge John Roberts, when serving on the D.C. Circuit, articulated in his dissent of a denial of rehearing en banc in Rancho Viejo, LLC v. Norton, 323 F.3d 1062, 1071-73 (D.C. Cir.2003). In that dissent, then-Judge Roberts stated that “[t]he panel’s opinion in effect asks whether the challenged regulation substantially affects interstate commerce, rather than whether the regulated activity does so. Thus, the panel sustains the application of the [Endangered Species] Act in this case because Rancho Viejo’s commercial development constitutes interstate commerce and the regulation impinges on that development, not because the incidental taking of arroyo toads can be said to be interstate commerce.” Id. (emphasis in original).

Whether Judge Benson’s reasoning may have some traction with the Tenth Circuit or the U.S. Supreme Court remains to be seen.

-- Josh Bloom and Dave Metres

For more information, contact Josh Bloom at (415) 228-5406, [email protected], or Dave Metres at (415) 228-5400, [email protected].