Gulf Oil Corporation v. The Honorable Rogers C. B. Morton, Secretary of the Interior of the United States of America

OPINION ON PETITION FOR A REHEARING

Upon consideration of appellees’ peti-tition for a rehearing and of appellants’ response, we have partially revised our views about this case as follows:

First: The Secretary’s order of April 21, 1971, which is under attack in this case, recites that it “shall terminate on January 2, 1973.” The order was justified on the ground that its purpose was “to permit the Congress to consider pending legislation for the termination of thirty-five leases. . . . ” The 92nd Congress adjourned, sine die, on October 18, 1972 ( 86 Stat. 1588 ), without taking any action on the Secretary’s proposed legislation. While we continue to be of the opinion that the Secretary’s order was valid when made, we now hold that its only raison d’etre vanished on October 18, 1972, and it became invalid on that day. The second session of the 92nd Congress is the fourth session of the Congress to which the Secretary’s bill has been presented. Nothing substantial was done at any session to push the bill; no action was taken by the Congress at any session. Four tries are enough. We are therefore also of the opinion, and hold, that the Secretary’s authority to suspend the leases…

*143 OPINION

This is an appeal by the Secretary of the Interior and subordinate federal officials from a judgment (1) setting aside the Secretary’s orders suspending drilling operations on eleven oil and gas leases in the Santa Barbara Channel, (2) directing the Secretary to forthwith grant all pending applications for drilling permits, and (3) extending the initial term of these leases for 32 months to enable the lessees to exercise their rights under these leases.

We reverse.

1. The Facts

The relevant facts have been stipulated to by the parties. Plaintiffs are the holders of eleven oil and gas leases covering areas of the outer continental shelf in the Santa Barbara Channel, granted in 1968 pursuant to the terms of the Outer Continental Shelf Lands Act, 67 Stat. 462 (Aug. 7, 1953), 43 U.S.C. §§ 1331-1343 (OCS Act). They have paid some $153,000,000 for these leases. In January, 1969, a well being drilled by Union Oil Company under another lease, not one here involved, blew out, causing the massive Santa Barabara oil spill. Shortly thereafter, the Secretary suspended all operations on certain leases in the Channel. This order was complied with, although the companies took an…

(concurring) :

In my view, the second suspension order is before us only to demonstrate that our case, which is limited to the first suspension order, is not moot simply because it has expired by its terms.

The second suspension order is the subject of a second action pending in the district court arid is not here on appeal.

I think the rationale of Block v. Hirsh, 256 U.S. 135 , 41 S.Ct. 458 , 65 L. Ed. 865 (1920), justifies the first suspension order. I have my doubts about the second one, but that is not before us. Surely, as Judge Duniway indicates, the time arrives when enough is too much.

(concurring):

I concur in the opinion of Judge Duniway and also in the concurring comments of Judge Chambers.

Under the circumstances existing at and before the expiration of the first suspension order and continuing to exist at this time, Ithink it might be shown upon full hearing and consideration by the district court that the second sus *149 pension was arbitrary, capricious and discriminatory. Among the matters which might be relevant and material in such a hearing are: (1) more than five years have passed since appellees paid approximately $153,000,000.00 for the leases in question, without as yet having been permitted to exercise their leasehold rights, arguably in violation of constitutional rights; (2) in oral argument appellees’ counsel stated, without contradiction, that a considerable number of other lessees have been allowed to continue drilling for and extracting oil from lease sites in the Santa Barbara Channel during the suspension period applicable to appellees’ leases; (3) the express purpose for which the Secretary of Interior is authorized to grant oil and gas leases under the Outer Continental Shelf Lands Act, enacted in 1953, is stated in section 8(a): “In…

493 F.2d 141 6 ERC 1152 , 4 Envtl. L. Rep. 20 ,086, 4 Envtl. L. Rep. 20 ,377 GULF OIL CORPORATION et al., Plaintiff-Appellees, v. The Honorable Rogers C. B. MORTON, Secretary of the Interior of the United States of America, et al., Defendant-Appellants. No. 72-2449. United States Court of Appeals, Ninth Circuit. Nov. 27, 1973, Rehearing Denied Mar. 25, 1974. William D. Keller, U.S. Atty. and Donald J. Merriman, Asst. U.S. Atty., Los Angeles, Cal., Jacques B. Gelin (argued), Kent Frizzell, Asst. Atty. Gen., Edmund B. Clark, Myles E. Flint, Attys., U.S. Dept. of Justice, Washington, D.C., for defendant-appellants. Gibson, Dunn & Crutcher-Samuel O. Pruitt, Jr., (argued), A. L. Wirin, and Fred Okrand (argued) for amici curiae, Los Angeles, Cal. Marvin Levine, Deputy Co. Counsel, Santa Barbara, Cal., for plaintiff-appellees. Before CHAMBERS and DUNIWAY, Circuit Judges, and BOLDT, * District judge. OPINION DUNIWAY, Circuit Judge: 1 This is an appeal by the Secretary of the Interior and subordinate federal officials from a judgment (1) setting aside the Secretary's orders suspending drilling operations on eleven oil and gas leases in the Santa Barbara Channel, (2) directing the…