Western Watersheds Project v. Deb Haaland ( 2022 )

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
WESTERN WATERSHEDS PROJECT; No. 20-35780
CENTER FOR BIOLOGICAL DIVERSITY,
Plaintiffs-Appellees, D.C. No.
1:18-cv-00187-
v. REB
DEB HAALAND, Secretary of Interior;
BUREAU OF LAND MANAGEMENT, an OPINION
agency of the United States,
Defendants,
STATE OF WYOMING; WESTERN
ENERGY ALLIANCE,
Intervenor-Defendants,
v.
CHESAPEAKE EXPLORATION, L.L.C.,
Movant-Appellant.
Appeal from the United States District Court
for the District of Idaho
Ronald E. Bush, Magistrate Judge, Presiding
Argued and Submitted September 28, 2021
Seattle, Washington
Filed January 5, 2022
2 WESTERN WATERSHEDS PROJECT V. HAALAND
Before: Ronald M. Gould, Richard R. Clifton, and Eric D.
Miller, Circuit Judges.
Opinion by Judge Clifton
SUMMARY *
Intervention
The panel reversed the district court’s order denying
Chesapeake Exploration, LLC’s motion to intervene as of
right in an action brought by plaintiff environmental groups
alleging that the federal government unlawfully issued oil
and gas leases on federal land, and remanded with
instructions to the district court to enter an order granting the
motion.
On May 12, 2020, the district court stayed vacatur of the
lease sales pending appeal. Chesapeake is an independent
producer of oil and natural gas, and two weeks after issuance
of the stay, it moved to intervene as a defendant in the case.
In its motion for intervention, Chesapeake noted that it had
already spent more than $19.7 million to acquire, explore,
and develop the leases. In “Phase One,” the district court
considered plaintiffs’ challenges to certain specific lease
sales. The district court first denied Chesapeake’s request to
intervene for purposes of the Phase One appeal in a July
2020 order, and then denied Chesapeake’s request to
*
This summary constitutes no part of the opinion of the court. It
has been prepared by court staff for the convenience of the reader.
WESTERN WATERSHEDS PROJECT V. HAALAND 3
intervene in subsequent phases of the litigation in a separate
August 2020 order.
The panel held that Chesapeake was entitled to
intervention as of right under Fed. R. Civ. P. 24(a).
Chesapeake has a significantly protectable interest that could
be impaired by the disposition of this action, its intervention
motion was timely, and its interests will not be adequately
represented by existing parties.
Addressing the element of timeliness, the panel
considered three factors: the stage of the proceedings at
which the applicant sought to intervene; the prejudice to
other parties; and the reason for and length of the delay.
Concerning the stage of proceedings, the panel held that
Chesapeake’s participation in the Phase One appeal did not
implicate its potential participation in subsequent phases of
the litigation, and vice versa. Because Chesapeake’s request
to intervene in Phase One of the appeal was analytically
distinct from its request to participate in a subsequent phase,
the district court should have treated the former request as
timely filed within the time for the filing of the appeal, which
it indisputably was. Accordingly, the stage of the
proceedings at which Chesapeake sought to participate
supported the conclusion that its request was timely. In
addition, the district court did not convincingly explain why
Chesapeake’s interest in an entirely new phase of the
litigation was not warranted. Concerning prejudice to the
parties, the panel held with respect to Chesapeake’s
attempted intervention in Phase One, the prejudice identified
by the district court boiled down to the likelihood that
additional parties and arguments might make resolution of
the case more difficult. This was a poor reason to deny
intervention. The district court gave the same inadequate
rationale when addressing Chesapeake’s request to intervene
4 WESTERN WATERSHEDS PROJECT V. HAALAND
in a subsequent phase. Concerning the reason for and length
of delay, the panel held that the district court erred to the
extent it measured the length of Chesapeake’s delay by
reference to events pre-dating the time at which it was
reasonably on notice that its interests were not being
adequately represented. Although Chesapeake moved to
intervene over two years after the start of this litigation, its
motion came just three months after it discovered that its
leases were involved in this litigation, and just over two
weeks after the district court stayed vacatur of the Phase One
lease sales. The panel concluded under the totality of the
circumstances that the district court abused its discretion in
finding that Chesapeake’s motion for intervention was
untimely.
Addressing the element of adequacy of representation,
the panel held that Chesapeake made sufficiently colorable
arguments that intervenor Western Energy Alliance would
not make all of Chesapeake’s proposed arguments.
Chesapeake identified three such arguments: execution of a
lease constituted a “subsequent ministerial act,” rather than
a final agency action, and therefore not subject to challenge
under the National Environmental Policy Act and the
Administrative Procedure Act; the plaintiffs, as third parties,
did not have the right to seek vacatur of a contract between
the United States (as lessor) and Chesapeake (as lessee); and
the district court could not vacate Chesapeake’s leases
without following applicable procedures under the Mineral
Leasing Act and relevant regulations.
The panel concluded that Chesapeake satisfied the
requirements for intervention as of right, and the district
court’s denial of intervention was error.
WESTERN WATERSHEDS PROJECT V. HAALAND 5
COUNSEL
William E. Sparks (argued), Beatty & Wozniak, P.C.,
Denver, Colorado, for Movant-Appellant Chesapeake
Exploration, L.L.C.
Andrew R. Missel (argued), Sarah Stellberg, and Laurence
(“Laird”) J. Lucas, Advocates for the West, Boise, Idaho, for
Plaintiffs-Appellees.
OPINION
CLIFTON, Circuit Judge:
Western Watersheds Project and the Center for
Biological Diversity brought this action against the Bureau
of Land Management and the Secretary of the Interior,
alleging that Defendants unlawfully issued oil and gas leases
on federal land. Chesapeake Exploration, L.L.C.
(“Chesapeake”), an independent producer of oil and natural
gas, moved to intervene as a defendant in the case, but the
District Court denied the motion.
The merits of the underlying dispute are not before us.
They are the subject of a separate appeal from other orders
of the District Court pending before a different panel of this
court. We are concerned in this opinion only with the denial
of Chesapeake’s motion to intervene.
We conclude that Chesapeake was entitled to
intervention as of right under Rule 24(a) of the Federal Rules
of Civil Procedure. Chesapeake has a significantly
protectable interest that could be impaired by the disposition
of this action, its intervention motion was timely, and its
6 WESTERN WATERSHEDS PROJECT V. HAALAND
interests will not be adequately represented by existing
parties. We reverse and remand.
I. Background
A. The Bureau’s Issuance of Oil and Gas Leases
The Bureau of Land Management (the “Bureau”) is an
agency within the U.S. Department of the Interior charged
with stewarding federal land and its resources to “meet the
present and future needs of the American people.” 43 U.S.C.
§ 1702(c). Although the Bureau meets this obligation in part
by leasing federal land for oil and gas development, see 30
U.S.C. § 226(a), it must also “take[] into account the long-
term needs of future generations,” which include
“watershed, wildlife,” and “natural scenic, scientific and
historical values,” 43 U.S.C. § 1702(c). The tension
between these competing priorities provides the background
for the underlying litigation.
The events underlying this dispute began over a decade
ago. In 2010, the Bureau issued Instruction Memorandum
(“IM”) 2010-117, a policy that required the Bureau to
conduct additional planning and analysis before issuing
leases on certain public lands, including those that contain
fisheries and wildlife habitats. This additional analysis was
to be led by an “interdisciplinary team” that engaged with
“the public and other stakeholders” who were potentially
affected by the Bureau’s leasing decisions.
Also in 2010, the U.S. Fish and Wildlife Service
(“FWS”) concluded that the greater sage-grouse, a bird
species found throughout parts of the American West,
warranted protection under the Endangered Species Act, 16
U.S.C. § 1531 et seq. See Endangered & Threatened
Wildlife and Plants; 12-Month Finding on a Petition to List
WESTERN WATERSHEDS PROJECT V. HAALAND 7
Greater Sage-Grouse (Centrocercus urophasiasnus) as an
Endangered or Threatened Species, 75 Fed. Reg. 13,910,
13,986–88 (March 23, 2010). In 2015, after a multi-year
planning process, the Bureau and the U.S. Forest Service
amended or revised 98 “Resource Management Plans” to
protect sage-grouse habitats across various Western states
(the “2015 Sage-Grouse Plans”). Endangered & Threatened
Wildlife and Plants; 12-Month Finding on a Petition to List
Greater Sage-Grouse (Centrocercus urophasiasnus) as an
Endangered or Threatened Species, 80 Fed. Reg. 59,858-01,
59,874, 59,935–36 (Oct. 2, 2015). These plans required the
Bureau to prioritize oil and gas leasing outside sage-grouse
habitats, id. at 59,876, and, in early 2016, the Bureau issued
IM 2016-143 to guide enforcement of this prioritization
requirement.
After the 2016 presidential election, however, the federal
government’s land-use priorities shifted. Under the new
administration, the Bureau accelerated oil and gas leasing,
including on land that contained ecologically significant
habitats identified in the 2015 Sage-Grouse Plans. Of
relevance here, the Bureau conducted an auction of oil and
gas leases in Wyoming in March 2018. Chesapeake, the
would-be intervenor in this case, was the high bidder on five
leases sold at this auction, for which the company paid over
$5.2 million. At another Wyoming auction held in
September 2018, Chesapeake paid over $3.2 million for two
additional leases. Chesapeake then began drilling wells on
its leases under the relevant state and federal permits.
B. Plaintiffs Challenge Leases on Sage-Grouse Habitats
Plaintiffs-Appellees Western Watersheds Project and the
Center for Biological Diversity are non-profit organizations
that seek to preserve public lands, natural resources, and
ecosystems across the American West. In April 2018,
8 WESTERN WATERSHEDS PROJECT V. HAALAND
Plaintiffs sued the Bureau to challenge its issuance of oil and
gas leases on sage-grouse habitats identified in the 2015
Sage-Grouse Plans. They also alleged that the Bureau and
Interior Secretary (collectively, the “Federal Defendants”)
had improperly adopted several policies that undermined
sage-grouse protections established under the previous
administration. 1
In particular, Plaintiffs alleged that IM 2018-026, issued
by the Bureau in December 2017 to replace IM 2016-143,
“effectively repeal[ed]” the requirement that the Bureau
prioritize oil and gas leasing outside sage-grouse habitats.
The complaint asserted that the Bureau improperly issued
IM 2018-026 without amending or revising its existing
Resource Management Plans as required under the Federal
Land Policy and Management Act of 1976 (“FLPMA”), 43
U.S.C. § 1701 et seq., or the National Environmental Policy
Act (“NEPA”), 42 U.S.C. § 4321 et seq. Plaintiffs also
challenged IM 2018-034, a separate instruction
memorandum issued by the Bureau in January 2018.
According to Plaintiffs, IM 2018-034 “overhauled” the
requirements established in IM 2010-117 and directed the
Bureau “to accelerate approval of oil and gas leases at the
expense of conducting [a] full environmental analysis” or
ensuring public involvement in the Bureau’s leasing
decisions. Plaintiffs alleged that the Bureau issued IM 2018-
034 without complying with the requirements of NEPA or
the Administrative Procedure Act (“APA”), 5 U.S.C. § 500et seq. Finally, Plaintiffs alleged that the Bureau had
improperly auctioned oil and gas leases on “hundreds of
thousands of acres” that were designated for protection in the
1
The Interior Secretary currently named in the caption of this case
is not the official Plaintiffs originally sued, nor did she oversee the
policies being challenged.
WESTERN WATERSHEDS PROJECT V. HAALAND 9
2015 Sage-Grouse Plans without conducting the required
“site-specific” environmental reviews.
In terms of relief, Plaintiffs asked the court to declare IM
2018-026 and IM 2018-034 unlawful under the FLPMA,
NEPA, and the APA, and to enjoin the Federal Defendants
from continuing to implement either policy. Plaintiffs also
asked the court to “[r]everse, set aside, hold unlawful, and/or
vacate” the Bureau’s sale of various oil and gas leases in
2017 and 2018, including the five leases Chesapeake had
purchased in March 2018. All told, Plaintiffs challenged
over 2,200 leases covering more than 2.39 million acres
across multiple states, arguing that the sales of these leases
were “individually and cumulatively unlawful under [the]
FLPMA, NEPA, their implementing regulations, and the
APA.”
After Plaintiffs filed their complaint, the Western Energy
Alliance (“WEA”) moved to intervene as a defendant. W.
Watersheds Project v. Zinke, No. 18-CV-187, 2018 WL
3997259, at *1 (D. Idaho Aug. 21, 2018). WEA, a regional
trade association representing more than 300 member
companies in the oil and gas industry (including
Chesapeake), argued that its members had considerable
financial interests in the challenged leases. Id. at *3. The
District Court granted WEA’s motion along with a similar
motion by the State of Wyoming. Id. at *4.
In September 2018, the District Court issued a
preliminary injunction requiring the Bureau to conduct
future lease sales in accordance with the procedures
previously outlined in IM 2010-117 until Plaintiffs’ claims
could be adjudicated on the merits. W. Watersheds Project
v. Zinke, 336 F. Supp. 3d 1204, 1212 (D. Idaho 2018).
Shortly thereafter, Plaintiffs filed an amended complaint
challenging additional oil and gas leases issued throughout
10 WESTERN WATERSHEDS PROJECT V. HAALAND
the summer and fall of 2018, including those purchased by
Chesapeake at the September 2018 auction. In December
2018, the District Court issued a case management order
dividing the litigation into discrete phases based on specific
lease sales. In “Phase One,” the court agreed to consider
Plaintiffs’ challenge to IM 2018-034 and a subset of
contested lease sales, including the two leases Chesapeake
acquired in September 2018. Chesapeake’s five leases from
the March 2018 auction were to be considered in a
subsequent phase of the litigation.
Finally, on February 27, 2020, the District Court entered
partial summary judgment in Plaintiffs’ favor with respect to
the Phase One claims. See W. Watersheds Project v. Zinke,
441 F. Supp. 3d 1042, 1049 (D. Idaho 2020). The court held,
in relevant part, that IM 2018-034 was improperly
promulgated without notice-and-comment rulemaking in
violation of the APA and FLPMA; that it improperly
constrained public participation in the Bureau’s leasing
decisions in violation of the FLPMA and NEPA; and that the
policy’s issuance was arbitrary and capricious under the
APA. See id. at 1049, 1059–75. Having found that IM 2018-
034 improperly restricted public involvement in the Phase
One lease sales, id. at 1075–82, the court vacated these sales,
id. at 1086–89, including Chesapeake’s two leases from the
September 2018 auction. The court explained that although
the “disruptive consequences” of vacating the Phase One
lease sales were “undeniably significant,” so were the
“deficiencies” in the sales themselves. Id. at 1087. Thus,
the court concluded that “vacatur . . . [would] avoid harm to
the environment and further the purposes of NEPA and
FLPMA.” Id. at 1088.
The court stayed vacatur of the lease sales pending
appeal, on May 12, 2020, explaining that although the leases
WESTERN WATERSHEDS PROJECT V. HAALAND 11
were “not [yet] to be undone,” neither was there to be any
“further work developing . . . or obtaining production from
[them] . . . pending appeal.” W. Watersheds Project v.
Zinke, No. 18-CV-187, 2020 WL 2462817, at *5 (D. Idaho
May 12, 2020). Despite this moratorium on development
and production, footnote six of the court’s order
acknowledged “that some work, to include ordinary
maintenance and repair, may be necessary to preserve the
status quo at locations where leasehold development is
already underway.” Id. at *5 n.6. Thus, under the so-called
“Footnote Six Protocol,” the court said it would “consider
motions from any party requesting additional detail as to
what work, if any,” would be permitted “to maintain the
suspended status quo” during the Phase One appeal. Id.C. Chesapeake Moves to Intervene
A little over two weeks after the District Court issued its
stay, Chesapeake moved to intervene for purposes of
appealing the Phase One decision and participating in any
subsequent phase in which its remaining leases were to be
considered. In its motion for intervention, Chesapeake noted
that it had already spent more than $19.7 million to acquire,
explore, and develop the leases. If forced to halt production
on these leases, it explained, the company could sustain
“irreparable financial harm.” In addition to outlining its
financial and real property interests in the litigation (and
explaining why those interests would be impaired without
intervention), Chesapeake argued that its interests were not
adequately represented by the Federal Defendants or WEA,
neither of whom shared the company’s “specific economic
interests derived from . . . real property interests.”
Chesapeake also maintained that its request for intervention
was timely. In a declaration accompanying its motion (the
“Cryer Declaration”), Chesapeake’s land manager, K.W.
12 WESTERN WATERSHEDS PROJECT V. HAALAND
Cryer, attested that the company had only “discovered that
its leases were involved in th[e] litigation when the [District]
Court issued its” February 2020 order vacating two of
Chesapeake’s leases. Finally, Chesapeake argued that the
litigation was still in its infancy, and that Plaintiffs, who
opted to challenge over 2,200 leases in a single lawsuit,
would not be prejudiced by intervention.
The District Court took a different view of the matter. In
a decision and order issued July 24, 2020, the court denied
Chesapeake’s motion to intervene in the Phase One appeal
and denied a similar motion by another oil and gas producer.
The court first concluded that Chesapeake was not a required
party under Rule 19 of the Federal Rules of Civil Procedure
because its interests were adequately represented by an
existing party to the suit, namely WEA. Both Chesapeake
and WEA, the court reasoned, “share the same ultimate
objective in this lawsuit,” that is, “upholding the validity of
the contested lease sales and avoiding lease vacatur.” Thus,
adjudicating the dispute in Chesapeake’s absence would not
“impair or impede” its ability to safeguard its interests.
The court also concluded that Chesapeake was not
entitled to intervene as of right under Rule 24(a). This
conclusion rested not only on the court’s finding that WEA
adequately represented Chesapeake’s interests, but also its
finding that Chesapeake’s application for intervention was
untimely. According to the court, Chesapeake’s attempted
intervention was untimely for three reasons: First, Phase One
was nearly complete; second, Chesapeake’s involvement
would introduce new arguments and issues on appeal, thus
prejudicing Plaintiffs; and third, Chesapeake had supposedly
“[been] aware of the lawsuit” and Plaintiffs’ effort to vacate
the Phase One leases “from the date [the case] was filed and
as the case developed,” and thus, any proffered reasons for
WESTERN WATERSHEDS PROJECT V. HAALAND 13
delay were unpersuasive. Finally, because “the timeliness
element is analyzed even more strictly” in the context of
permissive intervention under Rule 24(b) than it is in the
context of intervention as of right, the court concluded that
Chesapeake’s application for permissive intervention also
failed.
The District Court’s July 2020 order pertained only to
whether Chesapeake could intervene to participate in the
Phase One appeal; it did not address whether Chesapeake
could participate in subsequent phases of the litigation.
When the court took up the latter question in a separate
decision issued on August 17, 2020, it again concluded the
answer was no. In its decision, most of which was copied
verbatim from its July 2020 order, the court held that
Chesapeake was not a necessary party under Rule 19 and
was not entitled to intervene under Rule 24(a) or (b) for the
same reasons set forth in the prior order. The court also
declined to allow Chesapeake to intervene even for the
limited purpose of seeking relief under the Footnote Six
Protocol, noting that WEA would be permitted to request
such relief “on [Chesapeake’s] behalf . . . where appropriate
and necessary.” This appeal followed.
II. Discussion
“We have jurisdiction to review the denial of
intervention as of right as a final decision under 28 U.S.C.
§ 1291.” Perry v. Proposition 8 Off. Proponents, 587 F.3d
947, 950 (9th Cir. 2009) (quotation marks omitted). Our
review is de novo, though we review the timeliness element
for abuse of discretion. Smith v. L.A. Unified Sch. Dist., 830
F.3d 843, 853 (9th Cir. 2016).
Under Rule 24(a)(2), a nonparty is entitled to
intervention as of right when it “(i) timely moves to
14 WESTERN WATERSHEDS PROJECT V. HAALAND
intervene; (ii) has a significantly protectable interest related
to the subject of the action; (iii) may have that interest
impaired by the disposition of the action; and (iv) will not be
adequately represented by existing parties.” Oakland Bulk
& Oversized Terminal, LLC v. City of Oakland, 960 F.3d
603, 620 (9th Cir. 2020). 2 Although the applicant seeking
intervention bears the burden of showing that these four
elements are met, we interpret these requirements broadly in
favor of intervention. Citizens for Balanced Use v. Mont.
Wilderness Ass’n, 647 F.3d 893, 897 (9th Cir. 2011). “In
addition to mandating broad construction, our review is
guided primarily by practical considerations, not technical
distinctions.” Id. (citation omitted).
Plaintiffs do not dispute that Chesapeake satisfies the
second and third elements of the four-part test above.
Instead, they maintain that Chesapeake has failed to
demonstrate the timeliness of its application and the
inadequacy of WEA’s representation. We address each
element in turn.
A. Timeliness
“A party must intervene when he knows or has reason to
know that his interests might be adversely affected by the
outcome of litigation.” United States v. Alisal Water Corp.,
370 F.3d 915, 923 (9th Cir. 2004) (citation and quotation
marks omitted). To determine whether a motion for
2
Rule 24(a) provides that, “[o]n timely motion, the court must
permit anyone to intervene who: (1) is given an unconditional right to
intervene by a federal statute; or (2) claims an interest relating to the
property or transaction that is the subject of the action, and is so situated
that disposing of the action may as a practical matter impair or impede
the movant’s ability to protect its interest, unless existing parties
adequately represent that interest.” Fed. R. Civ. P. 24(a)(1)–(2).
WESTERN WATERSHEDS PROJECT V. HAALAND 15
intervention as of right is timely, we consider the totality of
circumstances facing the would-be intervenor, with a focus
on three primary factors: “(1) the stage of the proceeding at
which an applicant seeks to intervene; (2) the prejudice to
other parties; and (3) the reason for and length of the delay.”
Smith, 830 F.3d at 854. When evaluating these factors,
courts should be mindful that “the crucial date for assessing
the timeliness of a motion to intervene is when proposed
intervenors should have been aware that their interests would
not be adequately protected by the existing parties.” Id.
(citation and alteration omitted). For the reasons outlined
below, we conclude that the District Court abused its
discretion in finding Chesapeake’s motion untimely under
the totality of circumstances in this case.
1. Stage of the Proceedings
As discussed, the District Court first denied
Chesapeake’s request to intervene for purposes of the Phase
One appeal in a July 2020 order. It then denied
Chesapeake’s request to intervene in subsequent phases of
the litigation in a separate August 2020 order.
In concluding that Chesapeake should not be allowed to
intervene for purposes of the Phase One appeal, the District
Court observed that the case had been proceeding for more
than two years, during which time the court had permitted
other parties to intervene, denied multiple motions to
dismiss, transferred part of the case to Wyoming, granted a
preliminary injunction, and granted partial summary
judgment for Plaintiffs. Because the court had completed
“[m]uch, if not most, of the work on Phase One,” it held that
the first factor weighed against intervention.
It is true that “delay can strongly weigh against
intervention,” Alisal Water, 370 F.3d at 921, particularly
16 WESTERN WATERSHEDS PROJECT V. HAALAND
where “the district court has substantively—and
substantially—engaged the issues in th[e] case,” League of
United Latin Am. Citizens v. Wilson, 131 F.3d 1297, 1303
(9th Cir. 1997). We have also recognized, however, that “the
mere lapse of time, without more, is not necessarily a bar to
intervention.” Alisal Water, 370 F.3d at 921. The “general
rule is that a post-judgment motion to intervene [for
purposes of appeal] is timely if filed within the time allowed
for the filing of an appeal.” United States ex rel. McGough
v. Covington Techs. Co., 967 F.2d 1391, 1394 (9th Cir.
1992) (citation and alteration omitted). Plaintiffs do not
dispute that Chesapeake filed its intervention motion within
the time to file a notice of appeal from the Phase One
decision. Rather, they contend that the “more lenient”
timeliness standard in McGough does not apply here,
because Chesapeake also seeks to intervene in subsequent
phases of the litigation as well.
Plaintiffs’ argument relies on United States v.
Washington, 86 F.3d 1499 (9th Cir. 1996), where the court
“decline[d] to apply the timeliness analysis that would apply
to an intervention limited to appeal” because the would-be
intervenor sought to participate more extensively in future
aspects of the litigation, id. at 1505. Although Washington
bears a facial similarity to this case, it can be distinguished
in an important respect. Washington involved a so-called
“subproceeding” under the district court’s continuing
jurisdiction to address unresolved treaty issues between the
State of Washington and various Indian tribes. See id. at
1502. Nearly 20 years after the initial litigation addressing
these issues, the United States and 16 Indian tribes brought
a subproceeding to determine whether the tribes’ claim to
certain fishing rights prevailed over a competing claim by
the State of Washington. Id. The district court ruled in favor
of the tribes and invited the parties to negotiate an
WESTERN WATERSHEDS PROJECT V. HAALAND 17
implementation plan. Id. Three months later, an association
of non-Indian commercial fishers (who had no part in either
the initial litigation or the later subproceeding) moved to
intervene. Id. Although the association purported to
intervene for the limited purpose of appeal and any future
subproceedings, its requested intervention was actually
broader in scope: It sought to participate “in the negotiation
and formation” of the district court’s implementation plan
and “all proceedings” related to that plan. Id. at 1505. Thus,
the court declined to treat the motion as one for limited
intervention on appeal. Id. at 1506.
It is true that Chesapeake, like the fishers’ association in
Washington, seeks to intervene both for purposes of appeal
and also to participate in future aspects of the district court
litigation. But here, the Phase One appeal involves a discrete
set of factual and legal issues whose resolution is
procedurally distinct from subsequent phases of the
litigation. Because this litigation involves such divisible
phases, whether Chesapeake should be permitted to
intervene in a new, future stage of the litigation involves a
different set of considerations than whether it should be
permitted to participate in the Phase One appeal. That was
not the case in Washington, where the association sought to
participate in future aspects of the litigation that stemmed
from and were directly related to prior proceedings in which
the association had played no role. See id. at 1505. Though
the association “disingenuous[ly]” suggested that it sought
“limited intervention” for purposes of taking an appeal, in
reality it sought to position itself as a full participant in
negotiating—and then potentially appealing—the court’s
implementation plan. Id. Thus, the association’s request to
participate in future aspects of the litigation could not be
analytically severed from its request to participate in an
appeal. In that context, it made sense not to apply the “more
18 WESTERN WATERSHEDS PROJECT V. HAALAND
lenient” timeliness analysis that would govern a motion
seeking limited intervention on appeal. See id.Here, however, Chesapeake’s participation in the Phase
One appeal does not implicate its potential participation in
subsequent phases of the litigation, and vice versa. Because
Chesapeake’s request to intervene in Phase One of the
appeal is analytically distinct from its request to participate
in a subsequent phase, the District Court should have treated
the former request as “timely if filed within the time allowed
for the filing of an appeal,” McGough, 967 F.2d at 1394,
which it indisputably was. Accordingly, the stage of the
proceedings at which Chesapeake sought to participate
supports the conclusion that its request was timely.
In denying Chesapeake’s request to participate in a
subsequent phase that would impact its leasehold interests,
the District Court repeated the same rationale it had given
with respect to the Phase One appeal, noting once more that
“[m]uch, if not most, of the work on Phase One is complete
for the time being.” But that rationale does not explain why
Chesapeake should not be permitted to participate in an
entirely new phase of the litigation. This is not a situation,
for example, in which the would-be intervenor seeks to
“reopen [years] of litigation.” Smith, 830 F.3d at 856.
Rather, Chesapeake seeks to intervene at “the
commencement of a ‘new stage’ in the [litigation].” Id.; see
also Alisal Water, 370 F.3d at 921 (“Prior cases suggest that
a party’s interest in a specific phase of a proceeding may
support intervention at that particular stage of the lawsuit.”).
Although the District Court observed that Phase Two of the
litigation was “underway,” Chesapeake is not seeking to
intervene in Phase Two, as its remaining leases are now
scheduled to be litigated under Phase Four. In sum, the
District Court did not convincingly explain why
WESTERN WATERSHEDS PROJECT V. HAALAND 19
Chesapeake’s intervention in an entirely new phase of the
litigation (which had yet to begin) was not warranted,
particularly given the significant financial and property
interests at stake.
Although Plaintiffs acknowledge that the beginning of a
“new stage” in a case may be the appropriate time for a party
to intervene, they cite Garza v. County of Los Angeles, 918
F.2d 763 (9th Cir. 1990), for the proposition that such
reasoning applies only “where the new phase develops as a
result of a change in the law or the factual circumstances,”
not when the new phase arises “in the general progression of
the case to a close,” id. at 777. But Plaintiffs have taken our
statement in Garza out of context and applied it to facts that
are readily distinguishable.
In Garza, the plaintiffs filed a voting rights action
seeking to redraw districts for the Los Angeles County
Board of Supervisors (the “Board”). Id. at 765. After a
three-month bench trial, the court concluded that the County
had violated the Voting Rights Act and ordered it to propose
a redistricting plan that would produce a voting district with
a Hispanic majority. Id. at 767. As the case was unfolding,
the Board held a primary election under the existing
apportionment plan. Id. at 769. A primary candidate forced
into a runoff then sought to intervene in the lawsuit to oppose
any redistricting plan that would allow additional primary
candidates to compete in her race. Id. We upheld the district
court’s denial of intervention, explaining that the would-be
intervenor “knew that th[e] lawsuit was pending at the time
when she decided to run in the election, and knew that part
of the relief sought was a redistricting plan that could affect
the outcome of that election.” Id. at 777. Despite this
knowledge, the candidate “did not petition to intervene until
four months after she declared her candidacy,” which came
20 WESTERN WATERSHEDS PROJECT V. HAALAND
nearly two years after the beginning of the case. Id. We
observed that introducing a new party at such a late stage in
the case could produce “irreversible prejudicial delay” in
litigation “where time was of the essence.” Id.Here, by contrast, there is no evidence that Chesapeake
knew about Plaintiffs’ lawsuit when it purchased its leases
in March 2018 (a month before Plaintiffs even filed suit) or
September 2018. See pages 22–23 below. If Chesapeake,
like the candidate in Garza, had known about Plaintiffs’
lawsuit and recognized what the requested remedy might
entail, the outcome here would likely be different. But in
contrast to the would-be intervenor in Garza, Chesapeake
did not have such knowledge when it acquired its leases.
Thus, the new stage in which it seeks to intervene was not “a
foreseeable part of a chain of events” to it as it was to the
would-be intervenor in Garza. See 918 F.2d at 777.
2. Prejudice to Other Parties
We have observed that the second timeliness factor,
prejudice to existing parties, is “the most important
consideration in deciding whether a motion for intervention
is untimely.” Smith, 830 F.3d at 857 (citation omitted).
Under this factor, the only relevant “prejudice” is “that
which flows from a prospective intervenor’s failure to
intervene after he knew, or reasonably should have known,
that his interests were not being adequately represented.” Id.
Stated differently, “prejudice” does not arise merely “from
the fact that including another party in the case might make
resolution more difficult.” Id. (citation, alteration, and
quotation marks omitted).
Here, with respect to Chesapeake’s attempted
intervention in the Phase One appeal, the sole prejudice
identified by the District Court was the fact that Plaintiffs
WESTERN WATERSHEDS PROJECT V. HAALAND 21
would face additional briefing on appeal, including “possible
additional arguments not presented to or ruled upon by the
[District] Court.” If intervention were allowed, the court
reasoned, Plaintiffs may face “redundant arguments” and a
“piling on” effect. But to support this conclusion, the court
cited a single district court decision that did not involve an
attempt to intervene on appeal. See generally Shoshone-
Bannock Tribes of Fort Hall Rsrv. v. United States Dep’t of
Interior, No. 10-CV-4, 2010 WL 3173108 (D. Idaho Aug.
10, 2010). Apart from the fact that Chesapeake’s request to
intervene in the Phase One appeal was filed within the time
allowed for filing an appeal, and was therefore timely, see
pages 16–19 above, the prejudice identified by the District
Court boils down to the likelihood that additional parties and
arguments might make resolution of this case more difficult.
See Smith, 830 F.3d at 857. That is a poor reason to deny
intervention, particularly given the possibility that
Chesapeake’s additional arguments could prove persuasive.
That Chesapeake might raise new, legitimate arguments is a
reason to grant intervention, not deny it.
The District Court gave the same rationale, virtually
word-for-word, when addressing Chesapeake’s request to
intervene in a subsequent phase affecting its leasehold
interests and any briefing under the Footnote Six Protocol.
But this rationale carries little if any weight in the context of
subsequent phases that had either just begun or had yet to
begin. That is, if Chesapeake were allowed to intervene in
Phase Four to defend its remaining leasehold interests,
Plaintiffs would not be prejudiced by “possible additional
arguments not presented to or ruled upon by the [District]
Court,” or by a “piling on” effect, for this phase was not
underway when the court issued its ruling. Once again, the
prejudice described by the District Court is merely the
likelihood that Plaintiffs might have to confront additional
22 WESTERN WATERSHEDS PROJECT V. HAALAND
briefing and arguments. But that is a predictable risk when
challenging over 2,200 leases, across vast swathes of the
American West, in a single action. That this litigation may
become more tangled and complex with the addition of
interested parties is not a basis for denial of intervention. See
Smith v. L.A. Unified Sch. Dist., 830 F.3d at 857.
3. Reason For and Length of Delay
The third timeliness factor considers “the length of, and
explanation for, any delay in seeking intervention.” Smith v.
Marsh, 194 F.3d 1045, 1051–52 (9th Cir. 1999). In
evaluating this factor, courts are to measure the length of an
intervenor’s delay by reference to the point at which the
intervenor knew, or reasonably should have known, that its
interests were not being adequately represented by existing
parties. Smith, 830 F.3d at 859.
In its July 2020 order denying Chesapeake’s request to
intervene in the Phase One appeal, the District Court stated
that Chesapeake “[was] aware of the lawsuit and that
Plaintiffs were seeking to set aside the Phase One leases as
part of that litigation, from the date it was filed and as the
case developed.” Oddly, however, the court’s sole support
for this statement was Plaintiffs’ initial complaint, their
motion for partial summary judgment, and WEA’s motion to
intervene. The court did not explain how these documents
put Chesapeake on notice, or should have put it on notice,
that its interests were not being adequately represented by
existing parties. More problematic is the fact that the court
apparently overlooked uncontested record evidence, set
forth in the Cryer Declaration, that Chesapeake did not even
know “that its leases were involved in this litigation” until
the court issued its February 2020 order vacating the sale of
WESTERN WATERSHEDS PROJECT V. HAALAND 23
two of Chesapeake’s leases. 3 If the court had some basis to
question this representation, it could have conducted further
inquiry by, for example, holding an evidentiary hearing or
ordering supplemental declarations from relevant company
staff. But there is no evidence in the record that any such
inquiry took place, and the court makes no reference to the
Cryer Declaration in either of its orders denying
intervention. We are left to conclude, therefore, that the
court simply overlooked this evidence.
Similarly, in its order denying Chesapeake’s request to
intervene in a subsequent phase of the litigation, the District
Court stated that Chesapeake, as a member of WEA, was
aware of this lawsuit and the fact that Plaintiffs were seeking
to vacate its lease sales. Again, however, the court referred
to the same documents cited in its previous order without
acknowledging the conflicting evidence set forth in the
Cryer Declaration. The court did not explain how
Chesapeake’s membership in WEA, which represents more
than 300 companies, would necessarily have put the
company on notice that its leases were involved in this
litigation.
3
Plaintiffs argue that Chesapeake failed to raise this argument
before the District Court. That is not true. On page 10 of its brief in
support of its motion for intervention, Chesapeake stated that it “was not
aware until recently that the [District] Court would attempt to vacate and
cancel its [l]eases.” In support, Chesapeake cited to paragraph 11 of the
Cryer Declaration, which states that Chesapeake had only learned that
its leases were involved in the litigation in February 2020. Although
Chesapeake’s brief could have been clearer, it is inaccurate to suggest
that Chesapeake did not raise an argument regarding its belated
knowledge that its leases were involved in this litigation. Moreover,
while parts of Chesapeake’s brief might be read to suggest that
Chesapeake knew about the litigation generally, Chesapeake did not
concede knowing that its leases were involved, as Plaintiffs argue.
24 WESTERN WATERSHEDS PROJECT V. HAALAND
Thus, the District Court “erred to the extent it measured
the length of [Chesapeake’s] delay by reference to events
pre-dating the time at which [it was] reasonably on notice
that [its] interests were not being adequately represented.”
Smith, 830 F.3d at 859. Although Chesapeake moved to
intervene over two years after the start of this litigation, its
motion came just three months after it discovered that its
leases were involved in this litigation, and just over two
weeks after the District Court stayed vacatur of the Phase
One lease sales. Cf. id. at 859–60 (concluding that
intervention motion was timely where the movants sought
“to intervene approximately one year after the change in
circumstances prompting their motion,” but “only weeks
after definitively learning that their interests were not
adequately represented by the existing parties”).
We conclude that under the totality of circumstances, the
District Court abused its discretion in finding that
Chesapeake’s motion for intervention was untimely.
B. Adequacy of Representation
As discussed, intervention under Rule 24(a) also requires
Chesapeake to show that its interests “will not be adequately
represented by existing parties.” Oakland Bulk, 960 F.3d at
620. “The burden of showing inadequacy of representation
is ‘minimal’ and satisfied if the applicant can demonstrate
that representation of its interests ‘may be’ inadequate.”
Citizens for Balanced Use, 647 F.3d at 898. To evaluate
adequacy of representation, courts consider three factors:
“(1) whether the interest of a present party is such that it will
undoubtedly make all of a proposed intervenor’s arguments;
(2) whether the present party is capable and willing to make
such arguments; and (3) whether a proposed intervenor
would offer any necessary elements to the proceeding that
other parties would neglect.” Id. (citation omitted).
WESTERN WATERSHEDS PROJECT V. HAALAND 25
It is true that Chesapeake and WEA share the same
“ultimate objective” of upholding the Bureau’s lease sales;
thus, there is a presumption that WEA adequately represents
Chesapeake’s interests. See id. To rebut this presumption,
Chesapeake must make a “compelling showing” of
inadequate representation. Id. Here, Chesapeake has made
this showing by establishing that WEA will not
“undoubtedly make all of [the] proposed intervenor’s
arguments,” id., contrary to the District Court’s conclusion.
Indeed, Chesapeake has identified three arguments that
WEA did not raise before the District Court. Chesapeake
asserts that the execution of a lease constitutes a “subsequent
ministerial act,” rather than a final agency action, and
therefore is not subject to challenge under NEPA and the
APA. Chesapeake also argues that under the relevant federal
statutes, Plaintiffs, as third parties, do not have the right to
seek vacatur of a contract between the United States (as
lessor) and Chesapeake (as lessee). Finally, Chesapeake
contends that the District Court cannot vacate its leases
without following applicable procedures under the Mineral
Leasing Act and relevant Bureau regulations. Although
Plaintiffs dismiss these arguments as “meritless,” the
relevant standard requires merely that an existing party
cannot or will not “make any reasonable argument” that the
intervenor would make if it were a party. Salt River Project
Agric. Improvement & Power Dist. v. Lee, 672 F.3d 1176,
1180 (9th Cir. 2012) (emphasis added). Thus, we need not
determine whether these arguments are likely to prevail.
That they are colorable is sufficient at this stage.
Our decision in United States v. Oregon, 839 F.2d 635(9th Cir. 1988), illustrates why Chesapeake has made the
compelling showing necessary to warrant intervention as of
right. In Oregon, the United States had sued the State of
Oregon pursuant to the Civil Rights of Institutionalized
26 WESTERN WATERSHEDS PROJECT V. HAALAND
Persons Act, 42 U.S.C. § 1997 et seq., alleging that the state
had failed to provide “minimally adequate” training, medical
care, sanitation, and trained staff to serve the needs of
intellectually disabled residents at a long-term care facility.
See id. at 636. Residents of the facility sought to intervene
either as of right, under Rule 24(a), or permissively, under
Rule 24(b). See id. We reversed the district court’s denial
of intervention, concluding that the residents were entitled to
intervention as of right. See id. at 637–39. We explained
that although the United States and the residents shared the
common “goal of vindicating the [residents’] constitutional
rights,” it was also “apparent that the government’s
arguments [would] not include [certain] constitutional
deficiencies” which the residents themselves sought to raise.
Id. at 638. Accordingly, we held that the United States was
not adequately representing the specific interests the
residents sought to protect. Id. So it is here. Although
Chesapeake and WEA may share the same ultimate
objective in this litigation, Chesapeake has identified several
colorable arguments that WEA did not seek to raise in the
proceedings below. Indeed, as counsel for Chesapeake
observed at oral argument, WEA was given a mere 10 pages
in its Phase One merits brief, despite the fact that there were
932 leases at issue. Thus, in addition to our holding in
Oregon, practical considerations lead us to conclude that
WEA cannot adequately represent the more specific
“interests [Chesapeake] wish[es] to protect.” Id.Finally, as a party with a legally protected interest in
contract rights with the federal government, Chesapeake
“would offer [a] necessary element[] to the proceeding that
other parties would neglect.” Citizens for Balanced Use, 647
F.3d at 898. Unlike WEA or the State of Wyoming,
Chesapeake actually participated in the challenged lease
sales and obtained a property interest that is imperiled by this
WESTERN WATERSHEDS PROJECT V. HAALAND 27
litigation. We have observed, in the analogous context of
Rule 19, that “a party to a contract is necessary, and if not
susceptible to joinder, indispensable to litigation seeking to
decimate that contract.” Dawavendewa v. Salt River Project
Agric. Improvement & Power Dist., 276 F.3d 1150, 1157
(9th Cir. 2002); see also Lomayaktewa v. Hathaway, 520
F.2d 1324, 1325 (9th Cir. 1975) (“No procedural principle is
more deeply imbedded in the common law than that, in an
action to set aside a lease or a contract, all parties who may
be affected by the determination of the action are
indispensable.”). Although Rule 24, unlike Rule 19, does
not require us to determine whether Chesapeake is a
necessary or indispensable party, the principle identified in
the latter context carries persuasive force here. Chesapeake,
like the would-be intervenor in Dawavendewa, has a
substantial due process interest in the outcome of this
litigation by virtue of its contract with an existing party. See
276 F.3d at 1157 (noting that the “litigation threaten[ed] to
impair the [would-be intervenor’s] contractual interests, and
thus, its fundamental economic relationship with [an
existing party]”). This due process interest provides a
“necessary element[]” that would otherwise be absent from
this case. See Citizens for Balanced Use, 647 F.3d at 898.
Admittedly, WEA has intervened for the express
purpose of representing companies, such as Chesapeake, that
have due process interests in the challenged leases. But
WEA is charged with representing over 300 companies
“engaged in all aspects” of oil and gas production across the
western United States. Whereas Chesapeake took part in a
narrow subset of challenged lease sales and seeks to defend
a specific property interest in which it has invested millions
of dollars, WEA is obligated to represent the more general
interests of the oil and gas industry as a whole. It is possible
that Chesapeake’s more narrow interests (and the arguments
28 WESTERN WATERSHEDS PROJECT V. HAALAND
it seeks to make), informed by specific regional and
investment-related concerns, will differ from those of WEA,
which must necessarily take into account a more diffuse set
of considerations. Given its specific financial and property
interest, Chesapeake brings a unique perspective to this
litigation that existing parties may neglect. Cf. Forest
Conservation Council v. U.S. Forest Serv., 66 F.3d 1489,
1499 (9th Cir. 1995) (concluding that intervenors had
established inadequacy of representation where the existing
defendant was “required to represent a broader view than the
more narrow, parochial interests” advanced by the
intervenors), abrogated on other grounds by Wilderness
Soc’y v. U.S. Forest Serv., 630 F.3d 1173 (9th Cir. 2011) (en
banc).
Because Chesapeake has satisfied the requirements for
intervention as of right under Rule 24(a), the District Court’s
denial of intervention was in error. We need not reach the
Parties’ remaining arguments under Rule 24(b) or Rule 19.
Costs to be taxed against Plaintiffs-Appellees.
REVERSED AND REMANDED for further
proceedings with instructions to the District Court to
enter an order granting the motion for intervention.