Court: Case Against Calif. Oil and Gas Regulator Over Lax Environmental Review May Proceed

After considering motions for demurrer, a California state court judge determined that he could not rule in favor of the California Geologic Energy Management Division (CalGEM) and three oil-industry lobbying groups, finding the complaint filed by the Center for Biological Diversity viable.

In the February-filed case, the environmental advocacy plaintiff argued that the authority charged with supervising the drilling, operation, and maintenance of oil and gas in California “ignored its legal obligation to analyze environmental and health harms before issuing permits and approvals for oil and gas projects across the state,” the Center’s press release said. In particular, the lawsuit pointed to CalGEM’s approval of nearly 2,000 permits, in 2020 alone, for new oil and gas wells without the requisite environmental review.

The Center sued under the California Environmental Quality Act (CEQA), contending that CalGEM unlawfully approved projects for years without conducting oil and gas well impact and mitigation analyses. As a result of its cursory reviews, thousands of permits have been issued without contemplation of the health and environmental risks they pose, the Center said.

Last week’s ruling found that motions for judgment on the pleadings submitted by CalGEM and separately by the Western States Petroleum Association, Independent Oil Producers Agency, and California Independent Petroleum Association, were premature. Judge Evelio Grillo considered procedural issues, such as whether the plaintiff properly alleged that CalGEM has a pattern or practice of skimping on environmental reviews and whether the Center’s declaratory relief claim “is an end run around the CEQA procedure for challenging individual decisions.”

The court declined these arguments, finding the operative filing adequately pleaded. Judge Grillo also ruled that declaratory relief was an appropriate remedy for a claim that a state agency failed to comply with CEQA.

The court noted that going forward, the Center will need to provide “proof of more than occasional failures or isolated incident” to succeed on its CEQA claim. The case will now proceed through discovery.

The Center is represented by its own counsel, Earthrights International, Stanford Environmental Law Clinic, and Schonbrun Seplow Harris Hoffman & Zeldes LLP.