A multimillion-dollar settlement reached
quietly during Christmas week between California
farmers and the Bush administration is likely to
lead to more lawsuits seeking big payouts from
The $16.7 million settlement cements, for the
first time, a court finding that government
efforts to protect endangered species violate
the constitutional protection of property
Rather than appeal, as California state
officials and some federal government lawyers
urged, the Bush administration decided to accept
defeat and pay farmers for water diverted to
help endangered salmon.
In doing so, the administration signaled its
approval of the idea that farmers served by
government water projects own the water
delivered through those projects.
"I think it was a terrible thing that the
government didn't appeal it, partly because it's
wrong and partly because the government is
usually quite zealous about trying to protect
the Treasury against claims that are
disputable," said Joseph Sax, a law professor
emeritus at the University of California.
"It's obvious that the case is seen as a
green light by property rights advocates," added
Sax, who was a counselor to the Clinton
administration on water and other environmental
The case, known as Tulare Lake, marks the
first time a court has found the government's
enforcement of the Endangered Species Act a
violation of the Fifth Amendment prohibition
against taking private property without
compensation, according to the farmers' lawyer
in the case, Roger Marzulla.
Several similar lawsuits are already on deck:
The city of Stockton and other surrounding
agencies seek $500 million for water they say
the federal government failed to deliver from
New Melones Dam over a 10-year period; Klamath
farmers want $100 million for water diverted to
protect endangered salmon and suckers; and a
small Ventura County water district is expected
soon to file a claim for about $8 million for
water released in the Ventura River for
The success of the Tulare case is expected to
bring even more lawsuits.
"I think this fight is going to get a lot
meaner before it gets nicer. There's tens of
billions of dollars at stake," said Andrew
Lloyd, a lawyer for the Sacramento-based
property rights law firm, the Pacific Legal
At issue is whether water users actually own
property rights to the water they use. If so,
the Constitution protects them from governmental
"taking" of that water without compensation.
That could make protecting endangered species
very expensive, and might eventually make it too
costly for government agencies to protect
endangered fish and other aquatic species.
In a March 2004 memo urging the Department of
Justice to appeal the case, lawyers for the
National Oceanic and Atmospheric Administration
said the legal threat presented by the Tulare
Lake case was already making it more difficult
for the agency's biologists to enforce
endangered species protections for salmon.
Environmentalists and others contend water is
a public resource and that, with a few
exceptions, farmers and urban water agencies do
not own it.
The Tulare Lake case says they do. The ruling
is not binding on other courts, but the fact
that the government declined to appeal the case
leaves the door open for other water districts
to file similar claims, according to lawyers on
both sides of the issue.
Other judges could rule differently, or they
could follow the lead of the Tulare Lake judge,
Judge John Paul Wiese of the U.S. Court of
Federal Claims in Washington, D.C.
"It (the settlement) sends a clear message
that the Bush administration wants to encourage
lawsuits against the government," said Hal
Candee, a lawyer for the Natural Resources
A spokesman for the U.S. Department of
Justice did not return phone calls.
But Lloyd, the property rights lawyer,
suggested the government may be waiting to
appeal until it has a case it is sure to win.
Candee dismissed that argument, saying that
many experts believe the government could have
won an appeal of the Tulare Lake case. Water
users with long-term water contracts have tried
for years to force the government to pay them
when some of their contracted allotment of water
is shifted to endangered species.
Some have sued for breach of contract, while
others, like those in the Tulare Lake case, have
gone further by claiming to be deprived of
Neither legal course has been successful
In the Tulare Lake case, the federal claims
court found that even though the water rights
were held by the California Department of Water
Resources, their customers gained a property
right to the water through their contracts.
Marzulla, a Washington, D.C. lawyer for several
water users, successfully argued that his
clients owned rights to their contracted water
because the state water department exists to
deliver water to them.
The state Department of Water Resources "has
only one right to the use of that water, and
that is to put it in the California Aqueduct and
send it south," he said.
The water users are customers of the
state-owned State Water Project, which includes
Lake Oroville, massive pumps at Byron and the
444-mile California Aqueduct, which ends in
"The government is certainly free to protect
the fish as long as it is willing to pay for
it," Marzulla said.
To environmentalists and others, the
contracts do not amount to ownership of water.
They also say the possibility of shortages is
spelled out in the contracts.
If the ruling stands, government agencies may
decide they can no longer afford to take actions
aimed at protecting endangered fish and other
aquatic species, said Sax, the Berkeley
"If it (the Tulare Lake case) is followed in
other cases and by other judges, it could have a
very powerful, adverse effect on enforcement of
the Endangered Species Act," Sax said.
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