Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 1 of 42 UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

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1 Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 1 of 42 UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA CARPENTERS INDUSTRIAL COUNCIL; SISKIYOU COUNTY, CALIFORNIA; AMERICAN FOREST RESOURCE COUNCIL; HAMPTON AFFILIATES; THE MURPHY COMPANY; ROUGH & READY LUMBER LLC,; PERPETUA FORESTS COMPANY; SENECA SAWMILL COMPANY; SENECA JONES TIMBER COMPANY; SWANSON GROUP MFG. LLC; and TRINITY RIVER LUMBER COMPANY, Plaintiffs, and LEWIS COUNTY; SKAMANIA COUNTY; and KLICKITAT COUNTY, Plaintiff-Intervenors, v. SALLY JEWELL, Secretary of Interior; and DANIEL M. ASHE, Director, U.S. Fish and Wildlife Service, Defendants Civil No RJL PLAINTIFFS OPPOSITION TO DEFENDANTS CROSS-MOTION FOR SUMMARY JUDGMENT AND REPLY BRIEF IN SUPPORT OF PLAINTIFFS MOTION FOR SUMMARY JUDGMENT

2 Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 2 of 42 Table of Contents Introduction...1 Argument...3 I. THE COURT SHOULD REJECT FWS FIVE LIMITS ON THE SCOPE OF JUDICIAL REVIEW...3 A. The D.C. Circuit model-review cases incorporate the deference the Court must give agency selection of a simulation model, and no additional deference is required...3 B. The Court s review of the Modeling Framework is not limited to the characteristics of the data used in the modeling...5 C. FWS must explain, examine and defend every assumption in its models, not merely those it arbitrarily chooses to call key assumptions...6 D. FWS claim that it is required to use the best available simulation model, no matter how inaccurate or unreliable the model may be, and to use the best available data to run the model, even if the data is unreliable or legally deficient, lacks support in the ESA and is contrary to the APA standard of judicial review...7 E. The McLouth Steel Products Corp. open mind doctrine applies to the critical habitat rulemaking...9 II. FWS CONCEDES THE HARM THE CRITICAL HABITAT RULE WILL CAUSE...11 III. FWS FAILED TO EXPLAIN, EXAMINE AND DEFEND EACH STEP OF THE MODELING FRAMEWORK, AND IS UNABLE TO DO SO...11 A. FWS conceded, by failing to dispute, many key facts asserted in AFRC s Opening Brief...12 B. At least 37 critical assumptions in the HexSim model and 20 other Key Uncertainties in the Modeling Framework were never explained, examined or defended, and remain unknown to FWS...13 C. The FWS Brief argues that the key FWS assumption that all suitable NSO habitat is occupied is wrong, and that suitable NSO habitat is routinely unoccupied...17 D. FWS assumption that occupancy up to three years before or nine years after listing can lawfully support a finding of occupied at the time of listing is contrary to D.C. Circuit precedent...20 E. FWS disclosure that at least 3.3 million acres of the critical habitat network is not NSO habitat contradicts many key representations in the Final Rule, and FWS failure to provide the public this information during the rulemaking process is an APA rulemaking violation The contradictions show the Modeling Framework is arbitrary and capricious FWS failure to reveal during the rulemaking that the critical habitat network contains at least 3.3 million acres of non-habitat violates APA rulemaking requirements...24 F. The use of adjusted Barred Owl Encounter Rates that are unrelated to reality was arbitrary and capricious...26 G. FWS failed to address stark disparities between the MaxEnt habitat map and real world information supplied to FWS during the public comment process, even though FWS recognized that comparable disparities existed elsewhere on the MaxEnt map i-

3 Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 3 of 42 H. Even if FWS proposed characteristics of the data standard of agency model review applied here, the MaxEnt model requires random site data, and had no rational relationship to the non-random site data that FWS used...29 IV. FWS PUT AN ARBITRARY AND CAPRICIOUS 9.55 MILLION ACRE FLOOR ON THE FINAL CRITICAL HABITAT NETWORK...31 V. THE FWS DECISION TO ADOPT RECOVERY CRITERION 2 AS A LEGAL MANDATE TO DESIGNATE CRITICAL HABITAT SUFFICIENT TO ACHIEVE RECOVERY OF 11 SEPARATE SPOTTED OWL POPULATIONS WAS UNLAWFUL...33 VI. FWS FAILED TO SHOW IT HAD THE REQUIRED OPEN MIND ON THE MODELING FRAMEWORK...36 Final Note...37 Conclusion ii-

4 Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 4 of 42 Table of Authorities Cases Advocates for Hwy. and Auto Safety v. Fed. Hwy. Admin., 28 F.3d 1288 (D.C. Cir Alaska Oil and Gas Ass'n v. Salazar, 916 F.Supp.2d 974 (D. Alas Allina Health Services v. Sebelius, 746 F.3d 1102 (D.C. Cir Allied Local and Regional Mfrs. Caucus v. U.S. E.P.A., 215 F.3d 61 (D.C. Cir American Iron & Steel Inst. v. EPA, 115 F.3d 979 (D.C.Cir American Radio Relay League, Inc. v. F.C.C., 524 F.3d 227 (D.C. Cir ,25 Am. Wildlands v. Kempthorne, 530 F.3d 991 (D.C. Cir Appalachian Power Co. v. E.P.A., 135 F.3d 791 (D.C. Cir ,6,11 *Appalachian Power Co. v. E.P.A., 249 F.3d 1032 (D.C. Cir ,27 Beth Abraham Hosp. v. Bowen, 684 F.Supp. 367 (S.D.N.Y Bowen v. City of New York, 476 U.S. 467 ( Cape Hatteras Access Preservation Alliance v. U.S. Dept. of the Interior, 344 F. Supp. 2d 108 (D.D.C *Chemical Waste Mgmt., Inc. v. E.P.A., 869 F.2d 1526 (D.C. Cir ,6,29 *Friends of Blackwater v. Salazar, 691 F.3d 428 (D.C. Cir ,35 Greater Yellowstone Coalition v. Kempthorne, 577 F.Supp.2d 183 (D.D.C *In re Polar Bear End. Species Act Listing and Section 4(d Rule Lit., 709 F.3d 1 (D.C. Cir ,6,9 Khairkhwa v. Obama, 703 F.3d 547 (D.C. Cir *McLouth Steel Products Corp. v. Thomas, 838 F.2d 1317 (D.C. Cir ,10,11,35 Oakey v. U.S. Airways Pilots Disability Income Plan, 723 F.3d 227 (D.C. Cir *Otay Mesa Prop., L.P. v. U.S. Dept. of Interior, 646 F.3d 914 (D.C. Cir *Owner-Operator Indep. Drivers Ass'n, Inc. v. Fed. Motor Carrier Safety Admin., 494 F.3d 188 (D.C. Cir ,4,11,12,16 Rural Cellular Ass'n v. F.C.C., 588 F.3d 1095 (D.C. Cir Sherley v. Sebelius, 689 F.3d 776 (D.C. Cir Small Refiner Lead Phase Down Task Force v. E.P.A., 705 F.2d 506 (D.C. Cir Sw. Ctr. for Biological Diversity v. Babbitt, 215 F.3d 58 (D.C. Cir U.S. v. West Coast Forest Res. Ltd. P ship, 1997 WL (D. Or U.S. Air Tour Ass'n v. F.A.A., 298 F.3d 997 (D.C. Cir Williams Gas Processing - Gulf Coast Co., L.P. v. Fed. Energy Reg. Comm., 373 F.3d 1335 (D.C. Cir Statutes *Administrative Procedure Act, 5 U.S.C ,3 5 U.S.C U.S.C. 706(2...3 Endangered Species Act, 16 U.S.C et seq U.S.C. 1532(5...25,31 U.S.C. 1533(a( iii-

5 Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 5 of U.S.C. 1533(b(1(A...7 Regulation 50 C.F.R (e...26 Other Authorities 55 Fed. Reg (June 26, *Authorities chiefly relied on are indicated with an * -iv-

6 Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 6 of 42 Introduction Plaintiffs Carpenters Industrial Council, Siskiyou County, California, American Forest Resource Council and eight other manufacturers and landowners (collectively AFRC submit this Opposition/Reply Brief to focus on nine legal defects in the Final Rule, and rely on their Opening Brief (Op. Br. to show other legal defects that also invalidate the Critical Habitat Rule: 1 1. The assumptions and methodology in the Modeling Framework are arbitrary and capricious for six reasons: a. FWS failed to explain, examine or defend at least 37 critical assumptions in the HexSim model and 20 other Key Uncertainties in the Modeling Framework, which are disclosed in two key documents that were never revealed to the public during the rulemaking. b. The Fish and Wildlife Service (FWS Brief (FWS Br. now admits one of the central assumptions of the Modeling Framework that all suitable northern spotted owl (NSO habitat was occupied at the time of listing is wrong. c. The Modeling Framework s assumption that an owl sighting up to three years before or nine years after the time of listing permits FWS to identify an area as occupied at the time of listing is contrary to a controlling legal decision by the D.C. Circuit. d. The artificially reduced Barred Owl Encounter Rate assumptions in the Modeling Framework are contrary to current reality, and have no rational basis. 1 FWS has filed a cross-motion for summary judgment presenting arguments that go beyond the arguments in AFRC s opening brief. This brief opposes the FWS cross-motion and is the reply brief on AFRC s motion. To respond to arguments in the cross-motion, AFRC presents arguments beyond those in AFRC s opening brief. AFRC does not concede any FWS argument that it does not address in this brief; rather, as to those arguments AFRC relies on its opening brief. Also, throughout this brief all forms of emphasis are added; none are in the original texts. Page 1 - PLTFS OPP. TO DEFTS CROSS-MOT. FOR SUM. JUDG. AND REPLY IN SUPPORT OF PLTFS MOT. FOR SUM. JUDG.

7 Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 7 of 42 e. While the Final Rule relied heavily on the contention that modeling results showed that the designated critical habitat network is made up almost entirely of suitable NSO habitat that was occupied at the time of listing, the FWS brief reveals that the models actually told FWS that only 60 percent of the network contains suitable NSO habitat, and percent of the network, up to 3.75 million acres, contains no suitable NSO habitat and never will. This repudiation of the earlier reported modeling results, and revelation of contrary information withheld from the public during the rulemaking, is an additional ground (which AFRC could not have addressed in its opening brief showing the Modeling Framework is arbitrary and capricious, and FWS unlawfully withheld important information from the public during the rulemaking. f. FWS failed to respond to stark disparities between the MaxEnt model s habitat map and the reports of the BLM, Forest Service and private landowners showing that hundreds of thousands of acres the MaxEnt model had classified as suitable NSO habitat do not in fact contain NSO habitat, even though FWS had confirmed identical disparities reported by Washington state small woodland owners, after reviewing independent non-model-generated data and finding that in the vast majority of those cases the MaxEnt map was wrong. 2. Three other legal deficiencies in the Final Rule also stand out: a. FWS set an arbitrary and capricious 9.55 million acre floor on the final critical habitat network, with no disclosure during the rulemaking process and no meaningful explanation in the Final Rule, which unlawfully prevented FWS from choosing any network containing fewer than 9.55 million acres of land, and unlawfully prevented the public from commenting on the habitat floor. b. FWS violated APA and Endangered Species Act (ESA rulemaking procedures, and the Page 2 - PLTFS OPP. TO DEFTS CROSS-MOT. FOR SUM. JUDG. AND REPLY IN SUPPORT OF PLTFS MOT. FOR SUM. JUDG.

8 Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 8 of 42 substantive limits of the ESA, by adopting the non-binding Recovery Plan s Recovery Criterion 2 as a binding component of the Final Rule, thus requiring the critical habitat network to be sufficient to achieve the recovery of 11 separate NSO populations which may have led FWS to designate as much as five million acres of unnecessary critical habitat without considering or responding to AFRC s substantive comments opposing that decision. c. FWS did not meet its burden to show it maintained the open mind required for the critical habitat rule to lawfully transform the Modeling Framework and Recovery Criterion 2 into binding legal requirements. 3. The FWS brief also proposes five limits on the scope of judicial review. Before addressing the merits issues, AFRC explains that all five limits are wrong, and AFRC properly stated the judicial review standards in its opening brief. Argument 2 I. THE COURT SHOULD REJECT FWS FIVE LIMITS ON THE SCOPE OF JUDICIAL REVIEW While the parties agree that judicial review in this case is governed by the Administrative Procedure Act (APA, 5 U.S.C. 706(2, FWS. Br. at 17, FWS contends there are five limits on the proper standard of judicial review that AFRC has not recognized. FWS is wrong on all five. A. The D.C. Circuit model-review cases incorporate the deference the Court must give agency selection of a simulation model, and no additional deference is required. FWS predictably emphasizes the deference a court should give an agency model. FWS Br. 2 FWS has, in 15 separate places in its brief, impermissibly cited materials or information outside the certified Administrative Record, without seeking or obtaining leave of court. FWS Br. 11, 12, 13 n.3, 14 (two, 23, 23 n.7, 25, 29 (two, 39, 42 n.17, 52 (two, 55 n. 23. The Court should disregard all citations to materials outside the filed Record. Page 3 - PLTFS OPP. TO DEFTS CROSS-MOT. FOR SUM. JUDG. AND REPLY IN SUPPORT OF PLTFS MOT. FOR SUM. JUDG.

9 Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 9 of 42 4, 17, 24, 38, 40, 42, 44. FWS seems to assume that this deference must be applied as an overlay to the D.C. Circuit cases addressing judicial review of an agency model. FWS Br. 18, 24, 42. The D.C. Circuit holds otherwise. Although we apply a deferential standard of review to an agency's use of a statistical model, we cannot uphold a rule based on such a model when an important aspect of its methodology was wholly unexplained. Owner-Operator Indep. Drivers Ass'n, Inc. v. Fed. Motor Carrier Safety Admin., 494 F.3d 188, 204 (D.C. Cir For a court reviewing an agency model, [t]he principal question is whether the agenc[y s] explanation of the model's assumptions and methodology is reasonable. U.S. Air Tour Ass'n v. F.A.A., 298 F.3d 997, 1008 (D.C. Cir Deference must be coupled with thorough record scrutiny by the Court. Appalachian Power Co. v. E.P.A., 249 F.3d 1032, 1054 (D.C. Cir The Court s review of the Modeling Framework s assumptions and methodology should not be superficial, as FWS urges. The court must decide if the agency has provide[d] a complete analytic defense of the model, In re Polar Bear End. Species Act Listing and Section 4(d Rule Lit., 709 F.3d 1, 13 (D.C. Cir (citations and quotations omitted, and the reviewing court will examine each step of [the agency]'s analysis to satisfy [the court] that the agency has not departed from a rational course. Appalachian Power Co. v. E.P.A., 135 F.3d 791, 802 (D.C. Cir The reviewing court must reject an agency model if the agency failed to provide a reasoned explanation for a number of the methodology's critical elements. Owner-Operator Indep. Drivers Ass'n, Inc., 494 F.3d at 204. The more inflexibly the agency intends to apply the model... the more searchingly will the court review the agency's response when an affected party presents specific detailed evidence of a poor fit between the agency's model and that party's reality. Chemical Mfrs. Ass'n v. E.P.A., Page 4 - PLTFS OPP. TO DEFTS CROSS-MOT. FOR SUM. JUDG. AND REPLY IN SUPPORT OF PLTFS MOT. FOR SUM. JUDG.

10 Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 10 of F.3d 1259, 1265 (D.C. Cir FWS inflexible reliance on the Modeling Framework demands the most searching[] scrutiny of the poor fit between the Framework and reality. B. The Court s review of the Modeling Framework is not limited to the characteristics of the data used in the modeling. FWS argues that a reviewing court can reject an agency model only when the model bears no rational relationship to the characteristics of the data to which it is applied, FWS Br. at 19; see id. at 4, 18, 20, 32, 33, 47. To support its limited view of judicial review, FWS invites the Court to disregard all of the D.C. Circuit cases cited by AFRC as older case law...[t]hat is not the D.C. Circuit test reflected in the most recent cases... FWS Br. at 20. FWS is wrong. The cases cited by AFRC, decided between 1983 and 2013, all remain controlling D.C. Circuit precedents this Court is obligated to follow, for three unassailable reasons: a. There is no judicial doctrine that older cases carry less precedential weight than more recent cases, and FWS does not claim such a doctrine exists. b. In this circuit one three-judge panel of this court may not overrule another three-judge panel. Khairkhwa v. Obama, 703 F.3d 547, 550 (D.C. Cir The only exception is where due to an intervening Supreme Court decision, or the combined weight of authority from other circuits, a panel is convinced [a precedent] is clearly an incorrect statement of current law. Oakey v. U.S. Airways Pilots Disability Income Plan, 723 F.3d 227, 232 (D.C. Cir (citation and footnote omitted. No panel has overruled any of the precedents cited by AFRC, nor has an en banc court. c. The characteristics of the data standard offered by FWS has only the flimsiest basis in D.C. Circuit precedent. The first mention of that standard was in 1998 as dictum in Appalachian Page 5 - PLTFS OPP. TO DEFTS CROSS-MOT. FOR SUM. JUDG. AND REPLY IN SUPPORT OF PLTFS MOT. FOR SUM. JUDG.

11 Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 11 of 42 Power Co., 135 F.3d at 802. The court cited just two cases in support of its dictum: American Iron & Steel Inst. v. EPA, 115 F.3d 979, 1005 (D.C.Cir.1997 and Chemical Mfrs. Ass'n, 28 F.3d at Neither case articulates or applies a characteristics of the data standard. See American Iron & Steel Inst., 115 F.3d at 1005; Chemical Mfrs. Ass'n, 28 F.3d at While some later cases have quoted the characteristics of the data standard from the 1998 Appalachian Power case, see FWS Br. at 20, the quotes are either dictum or unelaborated; no D.C. Circuit case has ever explained the basis for a characteristics of the data standard, let alone claimed that standard supersedes the holdings of prior (and subsequent precedents. The 2013 In Re Polar Bear decision, the appellate court s most recent model-review case, does not apply the characteristics of the data standard that FWS proposes, but instead applies the broader standard AFRC has presented. This Court is not limited to reviewing the characteristics of the data. 3 C. FWS must explain, examine and defend every assumption in its models, not merely those it arbitrarily chooses to call key assumptions. FWS urges that it need only disclose the key assumptions of the Modeling Framework, but not every assumption. FWS Br Although FWS cites In re Polar Bear to support this claim, the case makes no such holding. Neither the decision nor the report that was cited in the decision indicate that any assumptions were not fully disclosed, and the court never ruled that some modeling assumptions do not have to be disclosed. As quoted above, the Court repeated the rule that the agency must provide a complete defense of its model, and Appalachian Power Co., 135 F.3d at 802, holds that the court should examine each step of the agency s model and 3 Even if the characteristics of the data rule applied, the Modeling Framework would still be arbitrary and capricious. See Sec. III(H infra. Page 6 - PLTFS OPP. TO DEFTS CROSS-MOT. FOR SUM. JUDG. AND REPLY IN SUPPORT OF PLTFS MOT. FOR SUM. JUDG.

12 Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 12 of 42 methodology. Even if a key assumptions standard applied, FWS repeated assertions in the Final Rule that it had disclosed key assumptions could not be upheld because FWS never identifies what those assumptions are, or explains how FWS decided which were key and which were not, except apparently everything FWS refused to disclose was not key. FWS post hoc claim is litigationdriven rather than scientific in nature, and should be disregarded. D. FWS claim that it is required to use the best available simulation model, no matter how inaccurate or unreliable the model may be, and to use the best available data to run the model, even if the data is unreliable or legally deficient, lacks support in the ESA and is contrary to the APA standard of judicial review. FWS also seems to argue that the D.C. Circuit model-review precedents are effectively superseded in this case by the ESA s requirement that critical habitat determinations must be made solely on the basis of the best scientific and commercial data available. 16 U.S.C. 1533(b(1(A. FWS focuses on the word available, arguing this provision means the agency must use an available simulation model no matter how flawed it may be unless someone can identify a superior model. On that thesis, FWS asserts that because no one identified a superior alternative, i.e., a comparable integrated framework that could be used to compare the performance of different possible designations... the Modeling Framework was the best available science, [and] the Service not only could lawfully use it to inform the designation, it was required to do so. FWS Br. 38. FWS also uses the same argument to argue it is entitled/required to run the model with the best available data even if that data is unreliable or legally deficient, which allows FWS a to use data from three years before to nine years after listing to support an occupied at the time of listing determination despite a D.C. Circuit case hold that such data is insufficient, FWS Br ; b to use non-random owl site Page 7 - PLTFS OPP. TO DEFTS CROSS-MOT. FOR SUM. JUDG. AND REPLY IN SUPPORT OF PLTFS MOT. FOR SUM. JUDG.

13 Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 13 of 42 data instead of the random data required by the MaxEnt model because random data were not available, so the non-random were the best available data, FWS Br , c to use the GNN model, no matter how great its flaws or how improperly FWS modified it, because AFRC identifies no alternative rangewide vegetation data, FWS Br. 41, and d to use GNN LandTrackr data to measure decadal habitat change because no better data base was available, although the LandTrackr developers and other experts had warned against using the data for that purpose. FWS Br This claim amounts to a contention that even if a model or the data used to run the model fails to meet the D.C. Circuit s model-review or APA review precedents, FWS must use the model with that data if no one has identified a better model or better data. The ESA does not support this claim because the ESA best available science provision works the other way; it prohibits the Secretary from disregarding available scientific evidence that is in some way better than the evidence he relies on. Am. Wildlands v. Kempthorne, 530 F.3d 991, 998 (D.C. Cir The ESA does not require FWS to use bad science, or a bad simulation model, for its decisions. If the available models are unreliable, FWS must make a decision without using a model. FWS relies on a statement in Sw. Ctr. for Biological Diversity v. Babbitt, 215 F.3d 58, 60 (D.C. Cir that even if the available scientific data are quite inconclusive, [the Secretary] may indeed must still rely on it. FWS Br. 37. The context of the passage shows it does not apply to this case. The court reversed a district court order that had directed FWS to undertake a new on-the-ground study before making a particular emergency listing decision; the court held that the best available standard means the agency is not required to initiate a new study on a species before Page 8 - PLTFS OPP. TO DEFTS CROSS-MOT. FOR SUM. JUDG. AND REPLY IN SUPPORT OF PLTFS MOT. FOR SUM. JUDG.

14 Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 14 of 42 making a listing decision. The inconclusive remark merely explained that the agency must make a decision on the available information even if the agency has to interpret conflicting data. This case does not involve inconclusive data ; it involves a never-before-used, never tested, never peer reviewed four-part computer simulation modeling structure that has so many errors, flaws and unexplained and inexplicable components that its results have no meaning. Nothing in Sw. Ctr. for Biological Diversity suggests FWS must use that modeling framework because no better modeling framework exists. FWS chose to use a modeling framework rather than one of the many [other] possible approaches to identifying and evaluating alternative potential critical habitat networks that are available, as FWS acknowledged in the Final Rule. AR FWS could have and should have designated critical habitat in this case without using a simulation model. Its decision to use the deeply flawed Modeling Framework was arbitrary and capricious, regardless of whether or not the Modeling Framework was the best choice among available simulation models. The claim that the ESA displaces the APA rules for judicial review of agency models is further refuted by In re Polar Bear, 709 F.3d 1, an ESA listing case, which, as noted, applies the established APA standard for judicial review. Id. at 13. E. The McLouth Steel Products Corp. open mind doctrine applies to the critical habitat rulemaking. FWS does not dispute the existence of an open mind doctrine emerging from McLouth Steel Products Corp. v. Thomas, 838 F.2d 1317, 1324 (D.C. Cir. 1988, but FWS denies the McLouth Steel rule applies to the FWS adoption of the Recovery Plan s Recovery Criterion 2 and Modeling Framework in the Critical Habitat Rule because [t]he Framework underwent full public notice and comment twice once as part of the recovery plan proceeding in which it was originally Page 9 - PLTFS OPP. TO DEFTS CROSS-MOT. FOR SUM. JUDG. AND REPLY IN SUPPORT OF PLTFS MOT. FOR SUM. JUDG.

15 Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 15 of 42 developed and then again for its use in the separate and subsequent critical habitat rulemaking. FWS Br. at 2; id. at 48. But McLouth Steel resolves that argument against FWS. That case involved precisely the same notice and comment twice situation as FWS claims here, and the Court found the earlier comment process was legally irrelevant to the second. In McLouth Steel, EPA had given notice of a proposed policy to use a specific model to make certain pollution control determinations, and the notice called for comment on the model. Id. at EPA accepted and incorporated comments, and published the final policy in the Federal Register. Id. at Later, EPA made a pollution control determination against McLouth Steel using the model. EPA argued, as FWS does here, that it had no duty to take comment on the model in the second proceeding because the agency had provided notice and comment on the non-binding policy statement. Id. at The Court rejected the argument, and found the earlier comment period was legally irrelevant because the published notice would not have alerted a reader to the stakes, id. at 1323, since it did not state the model would be binding in future decisions. Here, FWS similarly described the recovery plan as a non-binding document, AR , and, in addition, the D.C. Circuit has held that a recovery plan is non-binding. Friends of Blackwater v. Salazar, 691 F.3d 428, 435 (D.C. Cir Because FWS never told the public it would later treat portions of the Recovery Plan as a binding rule, FWS consideration of comments on the Recovery Plan, no matter how careful, cannot cure the defect. McLouth Steel, 838 F.2d at Since notice and comment on the non-binding Recovery Plan is irrelevant, FWS can rely only on the notice and comment opportunity on the critical habitat rule. The later notice and Page 10 -PLTFS OPP. TO DEFTS CROSS-MOT. FOR SUM. JUDG. AND REPLY IN SUPPORT OF PLTFS MOT. FOR SUM. JUDG.

16 Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 16 of 42 comment proceeding could cure the prior lack of APA rulemaking, but that curative effect depends on the agency's mind remaining open enough at the later stage. McLouth Steel, 838 F.2d at The Court must determine whether FWS maintained the requisite open mind when it adopted Recovery Criterion 2 and the Modeling Framework as binding legal norms in the critical habitat rule. As AFRC showed in its opening brief, FWS failed that test. II. FWS CONCEDES THE HARM THE CRITICAL HABITAT RULE WILL CAUSE. FWS does not dispute, and therefore concedes, the harm the FWS Critical Habitat Rule will cause: 1 the Rule places 2.8 million acres 70 percent of the Northwest Forest Plan lands designated for timber production into critical habitat for the NSO, Op. Br. at 1-2, 8; 2 the Rule will require the Forest Service and BLM to make a shift in management objectives within the revised critical habitat designation on those lands, AR 1-659, which will prohibit traditional clearcutting, AR 1-284; and 3 as a result, the Rule will make implementation of the Northwest Forest Plan impossible. Op. Br. at 8. The BLM estimated that the designation would reduce the entire future BLM timber sale program between 59 percent and 71 percent. AR III. FWS FAILED TO EXPLAIN, EXAMINE AND DEFEND EACH STEP OF THE MODELING FRAMEWORK, AND IS UNABLE TO DO SO. The core issue for this Court in reviewing the FWS Modeling Framework is whether FWS has adequately explained, examined and defended each step of the Modeling Framework, Appalachian Power Co., 135 F.3d at 802, and provided a reasoned explanation for the methodology's critical elements. Owner-Operator Indep. Drivers Ass'n, Inc., 494 F.3d at 204. The Record shows not only that FWS failed to explain, examine and defend each step of the Modeling Framework, but also that it is incapable of doing so as a result of the defective process used to Page 11 -PLTFS OPP. TO DEFTS CROSS-MOT. FOR SUM. JUDG. AND REPLY IN SUPPORT OF PLTFS MOT. FOR SUM. JUDG.

17 Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 17 of 42 develop the Framework. 4 Thus, the Final Rule must be set aside because the Court cannot uphold a rule based on... a model when an important aspect of its methodology was wholly unexplained. Owner-Operator Indep. Drivers Ass'n, Inc., 494 F.3d at 204. A. FWS conceded, by failing to dispute, many key facts asserted in AFRC s Opening Brief. FWS does not dispute the following factual assertions in AFRC s opening brief: 1. When FWS chose in 2009 to use the HexSim model in the Modeling Framework, the model was not complete, had never been published or peer reviewed, and had never been previously used for any real-world purpose. Op. Br. 15. All the HexSim simulation runs for the Critical Habitat Rule were performed by EPA employee Nathan Schumaker in his EPA office in Corvallis, Oregon. Schumaker was never directly supervised by anyone at FWS or EPA. Op. Br. 19. No one ever verified that he inputted data for the HexSim model correctly or ran the model correctly. Between 2010 and 2012 Schumaker often changed the HexSim model without the knowledge of FWS. Op. Br FWS never instructed Schumaker to preserve the documents he used while developing and operating the HexSim model for the Critical Habitat Rule, and FWS told him not to send copies of all his documents to FWS for archiving. Op. Br Schumaker often communicated via his 4 FWS claims AFRC should have raised these issues which are based on what FWS failed to include in its Final Rule during the 2012 public comment period, and has therefore waived them. FWS Br. at 55. The argument is wrong because AFRC could not possibly learn how illconceived the FWS decision-making process and document retention practices were until the Final Rule was issued in November 2012 and FWS produced its 160,000 page Administrative Record in No waiver can occur on an issue that is unknown during the public comment period. Bowen v. City of New York, 476 U.S. 467, 482 (1986 ( Since [m]embers of the class could not attack a policy they could not be aware existed,... it would be unfair to penalize these claimants for not exhausting under these circumstances.. Page 12 -PLTFS OPP. TO DEFTS CROSS-MOT. FOR SUM. JUDG. AND REPLY IN SUPPORT OF PLTFS MOT. FOR SUM. JUDG.

18 Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 18 of 42 personal , and did not systematically preserve his documents. Op. Br In , college instructor Jeff Dunk and his data-processing consultant David LaPlante conducted all the GNN, Maxent and Zonation model runs for the Recovery Plan, which were then carried forward, unchanged, for the Critical Habitat Rule. Op. Br. at 11. FWS never instructed Dunk or LaPlante to preserve the documents they used while working on the Critical Habitat Rule. Op. Br. 18. LaPlante realized in 2012 that he did not archive his documents carefully enough. Id. In 2012 LaPlante and Dunk lost a subset of their documents containing computer runs for two modeling regions. Id. Neither systematically preserved his documents. Op. Br. at These undisputed facts are the foundation for the conclusion that FWS violated its legal duties under the D.C. Circuit model-review cases. However, FWS says the Court may not consider anything in the record except the Final Rule to determine if the Modeling Framework is arbitrary and capricious, FWS Br , and the Court must ignore the internal deliberations or findings by the modeling team. FWS Br. 56. FWS is wrong. The whole record is available to the Court. 5 U.S.C B. At least 37 critical assumptions in the HexSim model and 20 other Key Uncertainties in the Modeling Framework were never explained, examined or defended, and remain unknown to FWS. 1. Schumaker s 2010 list of assumptions. AFRC s opening brief relied on two internal FWS documents to show the many key assumptions in the HexSim model that FWS never explained, examined or defended. FWS did not disclose either document to the public during the rulemaking Page 13 -PLTFS OPP. TO DEFTS CROSS-MOT. FOR SUM. JUDG. AND REPLY IN SUPPORT OF PLTFS MOT. FOR SUM. JUDG.

19 Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 19 of 42 process. 5 The first was a document that Schumaker sent the Modeling Team in 2010 describing over 100 hidden assumptions that Schumaker built into the HexSim model. Op. Br. 49. In the document, Schumaker states, I ve made the following assumptions about deriving HexSim parameter values from this data. AR These included the assumptions Schumaker called my most important free parameters. AR FWS admits that these assumptions generate the principal types of data used in the HexSim model. FWS Br. 33. AFRC will quote just four excerpts from that document, which reveal 37 separate assumptions in the HexSim model, to show that not a single one of these 37 assumptions was ever explained, examined or defended by FWS: I. At AR , Schumaker identifies 15 Range Size and Resources assumptions (all bracketed numbers for each assumption are interlineated: 1. [1] Territory size (a HexSim range can be approximated as the minimum home range size, and this approximation can be applied range-wide. [2] The assumptions that lead to this conclusion are first that home range size will decrease as resource quality increases. [3] At the limit where a home range consists entirely of optimal quality resource, home range size will have decreased to equal the size of a territory. [4] Secondly, I ve assumed that the territory size will not change with resource quality, and thus it can be applied range-wide. [5] Thus I have set the HexSim range size to 5 hexagons, maximum. [6] This places an upper limit on the amount of resource an owl can defend. [7] I used multiple trial simulations to compute the mean score of range hexagons. This value was almost always 60. Thus I set the resource target for territory construction to 5 x 60 = 300. [8] Owls will have territories smaller than 5 hexagons in size where available resources are better than average. 2. [9] The home range size (a HexSim explored area can be approximated with the maximum home range sizes in the table above. [10] The assumption that lead to this conclusion is that spotted owls will expand their home range as needed in order to 5 AFRC was able to extract one of the two documents from FWS in 2011 through the Freedom of Information Act, but could not understand its significance in the absence of the many other materials that were never revealed to the public. Page 14 -PLTFS OPP. TO DEFTS CROSS-MOT. FOR SUM. JUDG. AND REPLY IN SUPPORT OF PLTFS MOT. FOR SUM. JUDG.

20 Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 20 of 42 acquire their requisite resources. [11] Setting the home range size to the maximum observed value enables simulated owls to extract resources from an area this large, but they will not extract more resources than they need individually. [12] I grouped the provinces into three parameter groups (see below. [13] The North-West group was assigned home ranges of 128 hexagons. [14] The North-East group was assigned home ranges of 84 hexagons. [15] The South group was assigned home ranges of 48 hexagons = max{37, 35, 48, 46}. ii. At AR , Schumaker identifies seven Survival assumptions: [1] In the HexSim scenario, low, moderate, and high resource classes were established. Owls in the low resource class are assigned the minimum survival values. Owls in the moderate resource class are assigned the mean survival values. Finally, owls in the high resource class are assigned the maximum survival values. [2] Each owl is placed in either the low, moderate, or high resource class based on its ability to acquire resources. [3] This resource acquisition process is measured relative to the owl s resource target, which changes by geographic zone. [4] Resource acquisition is also affected by landscape quality and competition. [5] Finally, two break points separate the spectrum of resource acquisition values (0-100% of an owls target resource into three categories (low, moderate, and high. [6] I am currently using 20% for the break point separating the low and moderate resource categories. [7] I m using 40% as the break point separating the moderate and high resource categories. These values are subject to change, and are my most important free parameters. iii. At AR Schumaker identifies seven Reproductive Rates assumptions: [1] Every even year our owls have a 70% likelihood of nesting. [2] Every odd year our owls have a 30% likelihood of nesting. [3] So on average, our owls have a 50% likelihood of nesting. [4] HexSim s reproduction event is user-stratified by trait combinations, and then parameterized with values for the probability of having each possible clutch sizes. [5] The model then displays the expected value for each trait combination. [6] In a females-only simulation, this expected value is equal to the fecundity, assuming all territorial animals are breeding. [7] Since only 50% (on average of our territorial owls will reproduce, the probabilities for associated with each clutch size must be set such that the expected value equals twice the actual fecundity. Thus we compute the expected values by doubling the fecundity estimates... iv. At AR , Schumaker identifies eight Movement assumptions: [1] The first movement event proceeds the reproductive pulse. In it, all floaters are Page 15 -PLTFS OPP. TO DEFTS CROSS-MOT. FOR SUM. JUDG. AND REPLY IN SUPPORT OF PLTFS MOT. FOR SUM. JUDG.

21 Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 21 of 42 allowed to explore (prospect for a vacant territory. [2] The owls are allowed to search an area up to 500 hexagons (43,300 ha in size. [3] They do not disperse, and they terminate their search if they can identify a vacant territory with a cumulative score of at least 300. [4] Individual hexagons range in score from 0 to 90, but some reserve strategies may include hexagons with scores up to 100. [5] The territory size cannot be more than 5 hexagons (433 ha in size. [6] If a vacant territory with a cumulative score of at least 300 cannot be identified, then the exploration will continue for the full 500 hexagons. [7] At that point, lower quality territories may be claimed. [8] The minimum acceptable territory scores were set to 100 (cumulative and 20 (individual hexagons. FWS does not deny these 37 assumptions are built into the HexSim model. Rather, FWS claims all 37 of these assumptions were satisfactorily addressed in three pages of the 2011 Recovery Plan AR , and FWS Br. 52. FWS is dead wrong. While the three cited pages do name a few of those assumptions, the Court can simply compare the text of the 37 assumptions quoted above with the text on those three pages to see that the three pages do not explain, examine or defend ANY of the 37 assumptions, or compare them to reality. These most important free parameters that create the principal types of data in the HexSim model meet any definition of key assumptions, and FWS failure to explain, examine or defend them, or compare them to the real world, makes the Modeling Framework arbitrary and capricious because an important aspect of [the FWS] methodology was wholly unexplained. Owner-Operator Indep. Drivers Ass'n, Inc., 494 F.3d at The Key Uncertainties Document. AFRC also pointed to a 2010 document prepared by the Modeling Team for internal FWS use that identified 20 Key Uncertainties in all four components of the Modeling Framework. AR AFRC showed that FWS failed to explain, examine or defend any of these 20 key steps in the Modeling Framework. FWS vaguely claims it addressed all 20 assumptions in Appendix C to the June 2011 Page 16 -PLTFS OPP. TO DEFTS CROSS-MOT. FOR SUM. JUDG. AND REPLY IN SUPPORT OF PLTFS MOT. FOR SUM. JUDG.

22 Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 22 of 42 Recovery Plan, the Modeling Supplement and/or Final Rule. FWS Br. 52 n.20. FWS offers a post hoc list of record citations that FWS might have cited if FWS had ever explained, examined and defended the 20 uncertainties. See Def ts Cross-Motion, Exhibit 5, ECF 40-5 (fourth column. 6 But the cited pages do not show that FWS did explain, examine and defend any of the 20 assumptions. Counsel s post hoc record citations in the semi-comprehensible Exhibit 4 attached to the FWS brief, even if correct, are also insufficient since the judicial review is limited to reasoning that is fairly stated by the agency in the order under review... Williams Gas Processing - Gulf Coast Co., L.P. v. Fed. Energy Reg. Comm., 373 F.3d 1335, 1345 (D.C. Cir C. The FWS Brief argues that the key FWS assumption that all suitable NSO habitat is occupied is wrong, and that suitable NSO habitat is routinely unoccupied. One the central assumptions in the entire Modeling Framework is that all suitable NSO habitat that existed at the time of listing in 1990, and exists today, was and is occupied by NSOs. AR The MaxEnt model was principally designed to identify suitable habitat, not predict occupancy by owls. FWS Br. 31. We did not use MaxEnt to assign occupancy status; we used MaxEnt to identify relative habitat suitability (RHS. AR The Modeling Team made a decision not to employ occupancy modeling approaches. AR Nonetheless, FWS decided to use the MaxEnt model to predict owl presence based on relative habitat suitability. AR We made an explicit assumption that the 1996-based 6 Both Exhibit 5 and Exhibit 4, attached to the FWS Brief, are improper and should be stricken: neither exhibit is part of the Administrative Record, and both exhibits contain sometimeslengthy descriptive commentary on the contents of certain pages of the Record which constitutes argument (from an anonymous author rather than fact. FWS should have included these interpretations and commentary on record documents in the FWS brief rather in than cryptic, semicomprehensible exhibits created for the litigation. Page 17 -PLTFS OPP. TO DEFTS CROSS-MOT. FOR SUM. JUDG. AND REPLY IN SUPPORT OF PLTFS MOT. FOR SUM. JUDG.

23 Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 23 of 42 habitat suitability model would reliably predict the distribution of spotted owls at the time of listing (1990. AR Specifically, FWS made an assumption that all habitat identified by the MaxEnt model as having relative habitat suitability (RHS of 35 or higher was occupied by NSOs. AR 1-159; AR Yet during the rulemaking, FWS contradicted this assumption with a calculation that 6.5 percent of suitable NSO habitat is not occupied. AR Now FWS goes farther and argues in its brief that this key assumption is wrong: a. [T]he relationship between suitable owl habitat and owl occupancy is not perfect. Owls may not be present where suitable habitat is located, due to barred owl competition, death, or a population not at equilibrium with its environment. FWS Br. 21. b. To explain (post hoc why FWS did not believe the BLM s conflicting occupancy data called the MaxEnt model into question, FWS again states that owls may not be present in all areas where habitat is located for a number of reasons. FWS Br. 29. c. Elsewhere in the brief, to explain why FWS dismissed data submitted by Dr. Larry Irwin showing that some of the forests in his long-term study in western Oregon that the MaxEnt model identified as suitable for NSOs was not occupied by NSOs. FWS again repeated that there is not a perfect relationship between the suitability of habitat and owl presence. FWS Br. 31. d. To justify FWS disregard of information submitted by Dr. Lowell Diller showing that the MaxEnt model s habitat predictions did not accurately identify areas occupied by owls on the Green Diamond Resource Company s lands, FWS agreed with Diller s statement that owl occupancy does not always correspond with good habitat. FWS Br. 32. Thus, faced with three field reports that areas identified by the MaxEnt model as highly Page 18 -PLTFS OPP. TO DEFTS CROSS-MOT. FOR SUM. JUDG. AND REPLY IN SUPPORT OF PLTFS MOT. FOR SUM. JUDG.

24 Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 24 of 42 suitable, and therefore assumed to be occupied, were not in fact occupied, FWS answer is to argue, that the information was unimportant because, of course, suitable habitat is not always occupied. FWS had similarly asserted in the Record that [t]here any many possible reasons that an organism (NSO in this case may not occupy suitable habitat (e.g., death, competition, population is not at equilibrium with its environment. AR All the way back in 1990, when FWS first listed the NSO: Not all spotted owl sites are occupied by spotted owls each year. 55 Fed. Reg (June 26, And in the 2011 Recovery Plan, FWS wrote: It is not uncommon for an occupied spotted owl site to be unoccupied in subsequent years, only to be re-occupied by the same or different spotted owls two, three or even more years later. AR FWS acknowledgment in its brief, and elsewhere in the Record, that not all suitable NSO habitat is occupied invalidates FWS explicit assumption that all suitable habitat is occupied by NSOs. Announcing that an assumption is explicit does not lessen the agency s duty to explain, examine and defend the assumption, which FWS has not done. The admitted, and demonstrated, invalidity of this key assumption makes the Modeling Framework arbitrary and capricious. FWS seeks deference for its flawed assumption on the ground that [t]he Service can rely on its own statistical analysis. FWS Br. 31. But that is not what happened here. The FWS statistical analysis was that there is not a perfect relationship between the suitability of habitat and owl presence, FWS Br. 31, but only that owls are more likely to be in higher RHS habitat than lower. Yet FWS rejected that statistical analysis and assumed there is a perfect relationship between suitability of habitat and occupancy by owls that all suitable habitat is occupied. No deference is due that concededly incorrect assumption. Page 19 -PLTFS OPP. TO DEFTS CROSS-MOT. FOR SUM. JUDG. AND REPLY IN SUPPORT OF PLTFS MOT. FOR SUM. JUDG.

25 Case 1:13-cv RJL Document 47 Filed 10/08/14 Page 25 of 42 D. FWS assumption that occupancy up to three years before or nine years after listing can lawfully support a finding of occupied at the time of listing is contrary to D.C. Circuit precedent. AFRC s opening brief, Op. Br , showed that FWS decision to base its occupied at the time of listing determinations on survey data from as early as 1987 and as late as is contrary to the holding in Otay Mesa Prop., L.P. v. U.S. Dept. of Interior, 646 F.3d 914 (D.C. Cir The only response FWS can offer is that the Service found that the [sic] survey data used were the best available data,... and [AFRC] identifies no other better data in its brief. FWS Br. 22 n.5. This response is legally deficient because in Otay Mesa the D.C. Circuit held that using data collected four years after the listing was unlawful where FWS has provided no evidence of sightings on plaintiffs' land [at the time of listing]. Id. at , 917. Here, FWS likewise seeks to use sightings up to three years before and nine years after the time of listing, and has provided no evidence of sightings at the time of listing in Even if those reports are the best available data, such reports are not sufficient under Otay Mesa to establish occupancy at the time of listing. E. FWS disclosure that at least 3.3 million acres of the critical habitat network is not NSO habitat contradicts many key representations in the Final Rule, and FWS failure to provide the public this information during the rulemaking process is an APA rulemaking violation. 1. The contradictions show the Modeling Framework is arbitrary and capricious. In response to AFRC s argument that the Modeling Framework appeared to overstate the total amount of suitable NSO habitat by at least six million acres, Op. Br , FWS revealed that 7 The data FWS refers to as 1996" data actually comes from any date between 1993 and AR ( Spotted owl data used in model development consisted of site center locations documented within three years (plus or minus of [1996]. Page 20 -PLTFS OPP. TO DEFTS CROSS-MOT. FOR SUM. JUDG. AND REPLY IN SUPPORT OF PLTFS MOT. FOR SUM. JUDG.