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Passamaquoddy group to appeal dismissal of LNG lawsuit

BANGOR, Maine – A federal judge has dismissed a lawsuit filed by a group of Passamaquoddy Indians against the BIA over the leasing of tribal land for a proposed liquefied natural gas terminal, but rendered a scathing criticism of the agency’s “mishandling” of the case.

In an Aug. 14 ruling, U.S. District Judge John Woodcock said the Passamaquoddy group Nulankeyutmonen Nkihtaqmikon (NN), which means “We Protect the Homeland,” cannot move forward with its case against the BIA in federal court because it has not exhausted the administrative appeals process.

The decision comes almost three years after the group filed its first federal lawsuit challenging the BIA’s approval of a 50-year lease between the Pleasant Point Passamaquoddy Reservation and Quoddy Bay LLC of Oklahoma to allow the company to develop an LNG terminal on a three-quarter acre portion of tribally owned land at Split Rock on Passamaquoddy Bay.

NN objects that the development would destroy their sacred land, which is used for traditional ceremonies, community events and recreation. Their lawsuit claims that the BIA ground lease approval violates the Federal Energy Regulatory Commission’s requirement for an Environmental Impact Statement; the Endangered Species Act for failing to consider the endangered whales that populate Passamaquoddy Bay; the National Historic Preservation Act for not reviewing the development’s impact on the tribal reservation, which is eligible for listing on the National Register of Historic Places; and the long term Indian Leasing Act, which requires the agency to obtain a fair market value appraisal of the land.

The BIA “simply ignored its own regulation” when it did not notify NN of their right to appeal the agency’s approval of the ground lease in June 2005 and “compounded its error” by making its approval effective immediately and, thereby, “circumventing the stay provision of its regulations,” Woodcock said.

“The BIA did precisely what its regulations were promulgated to avoid – making critical agency decisions, failing to notify interested parties and allowing the consequences of the decision to become immediately effective without measuring the public interest.”

He said the court cannot know whether the BIA’s “mishandling of this case is symptomatic of a broader agency practice.” But, he said, the decision to dismiss the lawsuit “represents the triumph of hope over experience and the Court fully expects the BIA to proceed in a manner consistent with its special expertise and solemn charge.”

Despite the BIA’s mishandling of the case, Woodcock dismissed the lawsuit in part because he was not convinced by NN’s claims of harm.

Teresa Clemmer of the Environmental and Natural Resources Law Clinic at the Vermont Law School, who represents NN, said her clients will appeal the dismissal to the 1st Circuit Court of Appeals. If Woodcock’s decision is upheld, NN will have to begin its challenge anew with an appeal to the Interior Board of Indian Appeals; otherwise the case will be remanded to the federal court.

“We were fairly surprised and disappointed, of course, in the outcome. We had argued that we didn’t think the judge was as limited in what he could do as he thought he was,” Clemmer said.

She said the ruling is contrary to U.S. Supreme Court decisions, the Administrative Procedures Act and the Endangered Species Act.

“We think that whole body of law clearly says we have a right to be in federal court especially since the BIA decision is final and is being implemented currently.”

In his 34-page ruling, Woodcock noted the “BIA’s dramatic change of position” on appeal last year when the 1st Circuit reversed his earlier decision to dismiss NN’s lawsuit on the grounds that the group did not have standing and the lawsuit was not “ripe” for adjudication.

The BIA had claimed earlier that the lease did not require an Environmental Impact Statement because it was a preliminary agreement contingent on permit approvals, but the agency changed its position during the appeal when it conceded that the lease actually approved the entire LNG project. That’s largely why the 1st Circuit sent the case back to him, Woodcock said.

But Adam Wilson, Quoddy LNG’s deputy project manager, told Indian Country Today that the BIA erred when it told the appeals court that its lease approval covered the entire project.

“We’re trying to rectify that right now. We’ve drafted an amendment to the ground lease that will clarify what the BIA approval was and what we expect it to be and we’ve just got to work out a few minor details and then give it to the justice department.”

He said the tribal council has approved the amendment, but he declined to release a copy to ICT.

NN said it intends to follow “a prudent course” and file a notice with the IBIA at the same time it files an appeal of Woodcock’s decision to the 1st Circuit.

“As to the most recent amendment to the ground lease approved by the tribal council, the BIA has yet to determine its impact. The question remains, how will the court view a party changing things last minute in order to moot a case?” the group asked on its Web site,

In July, Quoddy LNG announced it would stop its $46,875 quarterly payments to the tribe while it postpones or withdraws its application and tries to meet a deadline required by a state review board.

NN said the move was an indicator.

“No matter its positive spin, the company has long closed its doors, locked out those who once were employed there, and is having financial difficulty. The company has not secured anything close to viable for a project of this magnitude; it does though continue to have a problematic ground lease,” NN said.