Skipper V United States Fish And Wildlife Service

Key Facts

Issues

• The Court evaluated whether the Service conducted adequate economic impact analysis under ESA Section 4(b)(2). The Service's 'baseline' approach was found insufficient because it excluded costs attributable to the ESA listing itself, focusing only on incremental costs from the habitat designation. The Court adopted the Tenth Circuit's 'co-extensive' approach, which considers all economic impacts of the designation.
• The Court assessed whether the Service properly analyzed and weighed the exclusion of Units 7 and 8 from critical habitat designation. The Service's decision not to exclude these units was found arbitrary and capricious because it failed to consider the economic harm that would result from the designation, including impacts on property values and land use restrictions.
• The Court examined whether the Service properly determined that Units 7 and 8 were 'occupied' by the black pinesnake at the time of listing. The Court found the Service's conclusion unsupported by evidence of occupancy, as it relied on sparse, decades-old anecdotal sightings rather than observational data. The ESA requires 'best available science' for such determinations, and the Service's assumption that the snake occupied these areas was speculative without concrete evidence of presence.

Holdings

Remedies

• The Final Rule is vacated as it pertains to Units 7 and 8 and remanded to the Service for further proceedings consistent with this opinion.
• The Court vacates the Final Rule only as to Units 7 and 8, eliminating the current regulatory burden on Plaintiffs' land and ensuring that any future designation complies with statutory and procedural requirements. The remainder of the critical habitat designation remains in effect.

Legal Principles

• The Administrative Procedure Act provides that courts shall hold unlawful and set aside agency actions found to be arbitrary, capricious, or otherwise not in accordance with law. Courts must conduct a thorough, probing, in-depth review of agency reasoning. An agency action is arbitrary and capricious if it has relied on factors Congress did not intend to consider, entirely failed to consider an important aspect of the problem, offered an explanation counter to the evidence, or is so implausible it could not be ascribed to difference in view or agency expertise. The agency must articulate a rational connection between facts found and choice made in the administrative record.
• The ESA requires the Service to consider economic impacts when designating critical habitat under Section 4(b)(2). The Service must weigh benefits of exclusion against benefits of inclusion. The court adopts the Tenth Circuit's 'co-extensive' approach rather than the Ninth Circuit's 'baseline' approach for economic analysis, finding the baseline methodology systematically undercounts economic burdens and prevents meaningful cost-benefit analysis. The Service must be able to articulate a rational basis for its decision not to exclude areas.
• The Endangered Species Act requires the Service to use the best scientific and commercial data available when making determinations about species listing and critical habitat designation. The ESA distinguishes between 'occupied' critical habitat (areas within the geographical area occupied by the species at the time of listing) and 'unoccupied' critical habitat (areas outside the occupied geographical area). The Service must make an affirmative determination that unoccupied areas are essential for conservation. The Service cannot use the presence of suitable habitat to expand the boundaries of 'occupied' territory beyond where the species is actually found.

Precedent Name

• Kansas Natural Resource Coalition v. U.S. Fish & Wildlife Service
• Lujan v. Defenders of Wildlife
• New Mexico Cattle Growers Association v. U.S. Fish & Wildlife Service
• Otay Mesa Property, L.P. v. U.S. Department of Interior
• Weyerhaeuser Co. v. U.S. Fish & Wildlife Service
• Arizona Cattle Growers Association v. Salazar
• Alaska Oil & Gas Association v. Jewell

Cited Statute

• Code of Federal Regulations
• Administrative Procedure Act
• Regulatory Flexibility Act
• Endangered Species Act

Judge Name

Passage Text

• As set forth above, the Services' action suffers from multiple deficiencies. The designation of Units 7 and 8 was not supported by evidence of occupancy at the time of listing and the Service also relied on an economic analysis that failed to consider quantifiable impacts. These failures mirror those in Kansas Natural Resource Coalition, where the district court vacated the rule outright due to the Service's refusal to consider economic costs. Given the scope and severity of the Service's decisions, the Court concludes that vacatur — not mere remand — is appropriate. Vacatur will eliminate the current regulatory burden on Plaintiffs' land and ensure that any future designation complies with statutory and procedural requirements.
• The baseline methodology, by its very design, will always seek to attribute as many costs as possible to the pre-existing listing, thereby minimizing the 'incremental' costs of the critical habitat designation. This creates an analytical framework that is inherently biased against a full and fair consideration of economic impacts. Whether the overlap between the jeopardy and adverse modification standards is 99% or some lesser amount, the baseline approach still systematically undercounts the true economic burden of the designation and prevents the Service from conducting the robust cost-benefit analysis that Section 4(b)(2) requires.
• The Service makes the same analytical error here. It has taken a few sporadic sightings on the edges of the designated units and, by pointing to the existence of suitable pine forest throughout the area, has extrapolated those sightings to declare tens of thousands of acres 'occupied.' Just as the FWS could not declare 56 acres of dry land 'occupied' by an aquatic shrimp in Otay Mesa, it cannot declare thousands of acres of forest 'occupied' by an elusive snake based on a handful of fleeting encounters. Such a determination 'runs counter to the evidence before the agency' and is the essence of arbitrary action.