Eagle County v. Surface Transportation Board

The D.C. Circuit Court of Appeals granted a motion for remand without vacatur filed by the applicant and proposed operator for a rail line to transport waxy crude oil from the rural Uinta Basin in Utah to the national rail network. In May 2025, the U.S. Supreme Court reversed a portion of the D.C. Circuit’s August 2023 decision that concluded that the Surface Transportation Board (STB) violated NEPA when it approved the rail line. The Supreme Court did not address the D.C. Circuit’s determinations that the STB violated the Endangered Species Act and the Interstate Commerce Commission Termination (ICCT) Act. The applicant and proposed operator argued in their remand motion that the Supreme Court rejected the D.C. Circuit’s primary basis for vacating the STB’s approval and that the other violations “involved nothing more than insufficient or inappropriate explanations,” which would readily be remedied on remand. Environmental petitioners had urged the D.C. Circuit to reaffirm vacatur, arguing that the Supreme Court’s decision did not invalidate the D.C. Circuit’s ruling on certain “downline” effects of the rail line; the environmental petitioners also argued that the ESA violations were serious. Petitioner Eagle County also argued that vacatur was appropriate based on flaws in the STB’s NEPA analysis that the Supreme Court did not address; the County also argued that the ICCT Act violations warranted vacatur.

The D.C. Circuit Court of Appeals denied defendant-intervenors’ petition for rehearing en banc of its August 2023 opinion finding that the Surface Transportation Board (STP) violated NEPA, the Endangered Species Act, and the Interstate Commerce Commission Termination (ICCT) Act when it reviewed a proposal for construction and operation of an 80-mile rail line in Utah for which the predominant purpose would be transporting waxy crude oil produced in the Uinta Basin. The defendant-intervenors had argued that the court’s opinion conflicted with <a href="https://climatecasechart.com/case/delaware-riverkeeper-network-v-federal-energy-regulatory-commission-2/">2022</a> and <a href="https://climatecasechart.com/case/center-for-biological-diversity-v-federal-energy-regulatory-commission/">2023</a> D.C. Circuit decisions that they argued would not require consideration of upstream and downstream indirect effects where information is not known about upstream wells and downstream end users. They also argued that the court failed to apply the ICCT Act’s presumption favoring rail construction when it found that STB failed to sufficiently weigh environmental effects.

The D.C. Circuit Court of Appeals found “numerous” violations of the National Environmental Policy Act (NEPA) in the Surface Transportation Board’s review of the proposed construction and operation of an 80-mile rail line in Utah for which the predominant purpose would be transporting waxy crude oil produced in the Uinta Basin. The violations included failure to disclose reasonably foreseeable upstream and downstream effects of increased oil drilling and refining, including greenhouse gas emissions from combustion. The court was not persuaded, however, that any mischaracterization of the upstream environmental and downstream climate change impacts of the project as “cumulative” instead of “indirect” impacts had any prejudicial effect. The court also found violations of the Endangered Species Act and the Interstate Commerce Commission Termination Act (ICCT Act), but not the National Historic Preservation Act. With respect to the ICCT Act, the D.C. Circuit found that the Board’s order exempting the project from the full application requirements was arbitrary and capricious because the Board failed to weigh certain environmental effects, including climate effects of the combustion of fuel resulting from a major expansion of oil drilling. The court said “the ICCT Act necessitated a more fulsome explanation for the Board’s conclusion that the Railway’s transportation benefits outweighed the project’s environmental impacts.” The court vacated the exemption order, as well as the environmental impact statement and biological opinion.

Eagle County, Colorado and a group of five environmental groups filed petitions in the D.C. Circuit Court of Appeals for review of a Surface Transportation Board decision approving construction and operation of an 85-mile rail line in Utah. The proponents of the rail line contended that it would be a viable alternative to trucking. The line would carry oil produced in the Uinta Basin, as well as other goods produced or consumed in the Uinta Basin. The environmental groups also challenged the biological opinion issued by the U.S. Fish and Wildlife Service in connection with the approval of the rail line. Eagle County’s petition asserted that the STB’s decision “was issued without observance of procedures required by law, is arbitrary and capricious, constitutes an abuse of discretion, exceeds the STB’s statutory authority,” and was in violation of the Interstate Commerce Commission Termination Act, the National Environmental Policy Act, the Administrative Procedure Act, and other federal laws.