United States District Court, D. Nevada
MIRANDA M. DU, District Judge.
This Order addresses three threshold legal issues that the Court directed the parties to brief. The Court formulated these issues after hearing from the parties and giving them the full opportunity to provide input on the threshold legal issues requiring resolution. ( See dkt. no. 474.) The parties submitted opening and response briefs (dkt. nos. 500, 501, 502, 503, 504, 505), which the Court has reviewed.
The three threshold legal issues are: (1) whether the statute of limitations on Elko County's counterclaim under the Quiet Title Act ("QTA") has expired, and if it has, then the effect of the statute of limitations; (2) what is the standard of review for approval of a settlement where the federal government agrees to relinquish its property rights; and (3) what is the standard of proof required in determining whether Elko County has a right-of-way under Revised Statute 2477 ("R.S. 2477"), 43 U.S.C. § 932 (repealed 1976). (Dkt. no. 474 at 13-14.) The Court formulated the second and third issues based on Elko County's proposed question whether the United States has discretion to enter into a settlement agreement. While these threshold legal issues could have been better articulated, the Court finds that their resolution will help streamline future briefings and hearings about the proposed consent decree, including the disposition of TWS's objections and cross-claims. The Court therefore declines to address the "restructured" issues posed in Elko County's briefs,  as well as TWS's expansion of the legal issues. Moreover, some of these additional issues involve a merits determination, which the Court declines to resolve without further briefing.
II. THRESHOLD LEGAL ISSUES
(1) Has the statute of limitations on Elko County's QTA counterclaim expired? If it has, what is the effect of the statute of limitations?
The parties disagree about the effect of the statute of limitations' expiration on the Court's jurisdiction over the proposed consent decree. The United States argues that the Court has jurisdiction to review the proposed consent decree regardless of the merits of its statute of limitations defense to Elko County's QTA counterclaim. Elko County agrees. TWS does not dispute that the Court has jurisdiction over the United States' Clean Water Act claims and trespass claim, but disagrees that such jurisdiction extends to Elko County's purportedly time-barred QTA counterclaim.
The Court agrees with the United States and Elko County. Whether the statute of limitations on Elko County's counterclaim has expired does not affect the Court's jurisdiction to consider the proposed consent decree. The parties do not dispute that the Court has jurisdiction over the United States' claims. Nor do they dispute the controlling authority, Local No. 93, International Ass'n of Firefighters v. City of Cleveland, 478 U.S. 501 (1986). Rather, they disagree about its application.
In Firefighters, the Supreme Court affirmed a district court's order entering a consent decree that exceeded the type of relief available under Title VII upon which the lawsuit had been brought. Id. at 530. The Court determined that a consent decree must (1) "spring from and serve to resolve a dispute within the court's subject-matter jurisdiction;" (2) "come within the general scope of the case made by the pleadings;" and (3) "further the objectives of the law upon which the complaint is based." Id. at 525 (citations and internal quotation marks omitted). The Court also clarified that "a federal court is not necessarily barred from entering a consent decree merely because the decree provides broader relief than the court could have awarded after a trial." Id.
The consent decree proposed here seeks to resolve the United States' claims and Elko County's QTA counterclaim, which necessarily includes resolution of the United States' statute of limitations defense. The proposed consent decree "springs from" a federal dispute - the United States' claims - over which the Court undoubtedly has jurisdiction. In arguing that the Court lacks jurisdiction over Elko County's QTA counterclaim, TWS appears to conflate two issues: first, the Court's jurisdiction to review the proposed consent decree, and second, the Court's jurisdiction over the QTA counterclaim in light of the United States' statute of limitations defense. Whether the United States' statute of limitations defense has merits, however, would not affect the Court's jurisdiction to consider the proposed consent decree. Because the Court has jurisdiction over the United States' claims, it may consider a proposed consent decree that "provides broader relief." Id. A contrary holding would undermine the purpose of a consent decree, which is "primarily a means by which parties settle their disputes without having to bear the financial and other costs of litigating." Id. at 528.
(2) What is the standard of review for approval of a settlement where the federal government agrees to relinquish its property rights?
First and foremost, this threshold legal issue assumes resolution of an apparent dispute over what the United States agreed to give up with respect to South Canyon Road. TWS contends that the settlement agreement relinquishes a federal right-of-way. (Dkt. no. 501 at 17.) Elko County is indifferent to how the settlement agreement is characterized "so long as the agreement is enforceable as written." (Dkt. no. 503 at 6.) The United States argues that, as viewed by TWS and the Ninth Circuit, the characterization is "immaterial, " even though it objects to characterizing the settlement agreement as "an instrument conveying an interest in land." (Dkt. no. 500 at 17-18; dkt. no. 505 at 5.) In light of the parties' divergent constructions of the settlement terms, the Court must resolve this issue as part of its review of the proposed consent decree. Indeed, it would be absurd for the Court to even consider approving the proposed consent decree when the parties to the settlement agreement (i.e., the United States and Elko County) appear unwilling to commit to a unified description of the rights conferred with respect to South Canyon Road.
The parties do not dispute the well-established legal standard governing the Court's review of a consent decree - whether the decree is "fair, reasonable and equitable and does not violate the law or public policy." Turtle Island Restoration Network v. U.S. Dep't of Commerce, 672 F.3d 1160, 1165 (9th Cir. 2012) ( quoting Sierra Club, Inc. v. Elec. Controls Design, Inc., 909 F.2d 1350, 1355 (9th Cir. 1990) (internal quotation marks omitted). "Although a consent decree typically represents an amalgam of delicate balancing, gross approximations, and rough justice, ' and need not impose all the obligations authorized by law, ' a district court may not approve a consent decree that conflicts with or violates' an applicable statute." Conservation Nw. v. Sherman, 715 F.3d 1181, 1185 (9th Cir. 2013) (citation omitted).
The United States and TWS agree that TWS's objections and cross-claims involve the same question of whether the proposed consent decree complies with the statutory procedures for disposal of federal land. (Dkt. no. 500 at 16-17; dkt. no. 501 at 20.) They agree that the Court must examine the status of Elko County's claimed right-of-way in determining whether to approve the proposed consent decree and in resolving TWS's objections and cross-claims. They also agree that the consent decree cannot be approved if the Court finds ...