## Facts

- Environmental and citizen organizations challenged Department of the Interior coal lease sales in the Powder River Basin of Montana and Wyoming, covering approximately 1.6 billion tons of coal on about 23,000 acres of public land.
- Plaintiffs sued Interior officials and the Department under the Administrative Procedure Act, alleging that the Secretary accepted bids below “fair market value” (FMV) in violation of § 201(a)(1) of the Mineral Leasing Act, as amended by the Federal Coal Leasing Amendments Act of 1976.
- The Secretary replaced a minimum-acceptable-bid system with an entry-level-bid (ELB) system after studies indicated weakening western coal market conditions; the challenged sale used ELB with confidential pre-sale FMV estimates and internal review.
- Plaintiffs alleged members would suffer (1) economic harm because below-FMV bids would reduce revenue returned to the states under the federal revenue-sharing scheme and (2) aesthetic and recreational harm because lower pricing could increase coal development affecting lands members used.
- The district court denied a motion to dismiss the FMV claim for lack of standing but later granted summary judgment for defendants on the FMV claim; plaintiffs appealed.

## Issues

1. Whether the organizational plaintiffs had standing under the APA to challenge the Secretary’s acceptance of allegedly below-FMV coal lease bids.
2. Whether the Secretary’s FMV methodology and acceptance of bids under the ELB system were arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law under APA § 706(2)(A).

## Decision

- The Ninth Circuit held plaintiffs had standing based on alleged economic, aesthetic, and recreational injuries to members, traceable to the challenged lease sales and redressable by voiding and resale of leases.
- The court held the Mineral Leasing Act did not show a fairly discernible intent to preclude APA review by private parties and that plaintiffs’ interests fell within the statute’s zone of interests.
- On the merits, the court affirmed summary judgment for defendants, holding the Secretary acted within statutory discretion and the FMV determinations and use of ELB were not arbitrary or capricious.
- The court deferred to Interior’s technical and economic judgments on valuation methodology, including the selection and use of comparable sale data and other market and tract-specific factors.
- The court found the record supported Interior’s conclusion that bids met or exceeded FMV estimates for most tracts and that alleged procedural irregularities did not invalidate the Secretary’s determinations.

## Legal Principles

- Organizational standing exists when members face concrete injuries (including economic, aesthetic, and recreational harms), the injuries are fairly traceable to the challenged action, relief would likely redress them, and the claim is germane to the organization’s purposes without requiring individual member participation.
- Under the APA, agency action is set aside only if arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law; courts generally defer to reasonable technical and economic judgments supported by the administrative record.
- Statutory language requiring acceptance of no bid below FMV “as determined by the Secretary” grants substantial discretion in valuation methodology, so long as the agency considers relevant factors and explains its approach.
- Agencies may change bidding or policy frameworks in response to market conditions if the change is rationally explained and supported by studies or analysis.
- Absent a fairly discernible congressional intent to bar review, APA review remains available for challenges to federal mineral leasing decisions.

## Conclusion

The Ninth Circuit recognized broad standing for environmental organizations to contest federal coal leasing decisions but upheld Interior’s discretion to determine and apply FMV under the Mineral Leasing Act, affirming that the ELB-based lease sale and acceptance of bids were reasonable under APA review.


Nat'l Wildlife Fed'n v. Burford, 871 F.2d 849 (9th Cir. 1989)