[00:00:02] Speaker 05:
All right, thank you.

[00:00:03] Speaker 05:
We're now ready to call.

[00:00:08] Speaker 05:
Are we good to go, Judge Gould?

[00:00:11] Speaker 05:
Yes.

[00:00:12] Speaker 05:
OK.

[00:00:13] Speaker 05:
We'll now call our fourth case set for argument today, Yurok Tribe versus Klamath Water Users Association, case numbers 23-15499 and 23-15521.

[00:00:29] Speaker 01:
May it please the court?

[00:00:31] Speaker 01:
My name is Brittany Johnson, and I'm arguing on behalf of Appellant Klamath Water Users Association.

[00:00:36] Speaker 01:
I would like to reserve three minutes for rebuttal.

[00:00:39] Speaker 01:
In response to the court's question from yesterday's order, my argument will focus on KWA's first counterclaim.

[00:00:45] Speaker 01:
Mr. Reitman will be addressing the court's questions on the status of Klamath Irrigation District's challenge to the OWRD order.

[00:00:52] Speaker 01:
KWA's first counterclaim asks for a clear declaration that reclamation does not have discretionary authority to curtail or to direct the curtailment of storage, diversion, and delivery of water from the project for irrigation to benefit threatened or endangered species.

[00:01:08] Speaker 01:
And therefore, Section 7A2's no jeopardy and consultation requirements do not apply.

[00:01:14] Speaker 01:
The court has jurisdiction over the first counterclaim and may proceed to decide the merits of the case.

[00:01:19] Speaker 01:
KWA brought that counterclaim based on Reclamation's legal determination that it can curtail irrigation deliveries and manage the project for ESA purposes.

[00:01:29] Speaker 01:
It is this determination under which Reclamation operates the project to short its contractors and instead release the water for minimum flows in the Klamath River for salmon.

[00:01:38] Speaker 01:
This plays out every year in the annual operations plans and in all but the wettest years and the project is shorted and does not receive a full supply.

[00:01:48] Speaker 01:
This means land is followed that would otherwise be planted.

[00:01:51] Speaker 01:
Paragraphs 4, 5, 6, and 101 of the U.S.

[00:01:54] Speaker 01:
Cross Claim describe reclamation determinations, and paragraphs 67, 68, and 69 of the counterclaim describe KWA's dispute.

[00:02:04] Speaker 01:
And that first counterclaim is a separate claim than the preemption challenge brought by the United States focused on that 2021 OWRD order.

[00:02:12] Speaker 01:
To the extent that the court is still concerned about potential mootness, Center for Biological Diversity v. Loan sets forth that standard, and that case is reported at 511 Fed 3rd, 960.

[00:02:24] Speaker 01:
Where both injunctive and declaratory relief are sought, but the request for injunctive relief is rendered moot during

[00:02:31] Speaker 01:
the appeal, the case is not moot if declaratory relief would nevertheless provide meaningful relief.

[00:02:37] Speaker 01:
Or the case in controversy still exists if the challenge governmental activity has not disappeared and casts a substantial adverse effect on the interests of the parties.

[00:02:46] Speaker 01:
Today, right now, water users do not have a full allocation of contract supply despite the lake being full for the first time in four years.

[00:02:55] Speaker 01:
there's still going to be a shortage this year to the contractors.

[00:02:58] Speaker 01:
So this is a continuing and wrongful action.

[00:03:01] Speaker 01:
And Reclamation's determination of its discretionary authority controls the project every year.

[00:03:07] Speaker 01:
Granting the declaratory relief requested in KWA's counterclaim that Reclamation does not have that discretion to curtail the storage, delivery, and diversion of water for irrigation for species will provide that effective, meaningful relief to KWA's members.

[00:03:23] Speaker 01:
Controlling authority from this court supports KWA's position.

[00:03:27] Speaker 01:
Most recently, last month, the court issued an opinion in NRDC v. Holland and decided the same issues presented here under discretionary authority under executed contracts.

[00:03:39] Speaker 01:
The Ninth Circuit affirmed that once an agency executes a contract, it retains discretion to benefit listed species only to the extent permitted by the agreement's terms.

[00:03:51] Speaker 01:
The court reviewed similar contract language in long-term water contracts.

[00:03:57] Speaker 01:
that limits the liability of the United States for shortage as a result of drought or other causes, and concluded that a shortage provision does not give reclamation the discretion to alter the contract to benefit listed species or to reduce the amount of water diverted under that contract at its discretion.

[00:04:15] Speaker 01:
And that conclusion is consistent with this court's earlier en banc decision in NRDC v. Jewell from 2014.

[00:04:22] Speaker 01:
where the court held that nothing in the shortage provisions and water service contracts for the Central Valley Project requires reclamation to take actions to protect species.

[00:04:31] Speaker 01:
The United States here relies solely on the shortage provision and the Klamath Project contracts to support its position that it has discretionary authority to curtail project diversions, and this argument has been squarely rejected by this court twice.

[00:04:48] Speaker 01:
The Klamath project is one of the first reclamation projects authorized and constructed under the 1902 Reclamation Act.

[00:04:55] Speaker 01:
After a session of submerged lands by the states of Oregon and California for reclamation purposes, the United States built out the diversions and canals and then executed contracts with landowners.

[00:05:06] Speaker 01:
Those contracts captured the essential framework of federal reclamation law.

[00:05:10] Speaker 01:
Landowners would repay the cost of construction and operation and maintenance charges, and the Secretary of Interior, acting through reclamation, promised to store and deliver irrigation water to those lands.

[00:05:22] Speaker 01:
Today, the Klamath Project's main diversion works and hundreds of miles of canals, laterals, drains, and pumping stations are operated and maintained, and in some cases, owned by non-federal actors.

[00:05:34] Speaker 01:
The idea that Reclamation has this expansive federal authority over the complex network of canals, dikes, drains, and pumps, that's a myth.

[00:05:43] Speaker 01:
In the 1950s, the Secretary transferred the operation and maintenance of those works to the irrigation districts, as well as the contractual obligation to serve other contractors.

[00:05:54] Speaker 01:
Congress enacted legislation specifically approving those contracts with Tule Lake Irrigation District, Klamath Irrigation District, and Klamath Drainage District.

[00:06:03] Speaker 01:
And Reclamation now only owns Link River Dam and directs its operation to store or release water.

[00:06:09] Speaker 01:
The district court did not release, excuse me, the district court.

[00:06:12] Speaker 05:
Can I just ask, in order to rule in your favor, and I know we got the mootness question, which I guess we'll address separately, but wouldn't we have to find that the Bureau of Reclamation doesn't have any discretion under the agreements to divert the water?

[00:06:30] Speaker 05:
Isn't that ultimately the question we're being asked to decide?

[00:06:33] Speaker 01:
That they don't have, you would have to rule that they don't have discretion to curtail irrigation.

[00:06:39] Speaker 05:
And so basically the contract requires them to fulfill the irrigation responsibilities at the expense of anything else.

[00:06:48] Speaker 05:
Isn't that what we would have to find?

[00:06:49] Speaker 01:
Well, you would have to apply the test from EPIC as it is applied in NRDC v. Holland and look at the terms of the contracts and analyze whether those terms allow reclamation to either alter the terms of the contracts or reduce the diversion of water under the contracts.

[00:07:06] Speaker 01:
And if we briefed or we described the terms of those contracts in our opening brief in detail, and there is no such language that allows reclamation to go back and revise the contracts,

[00:07:18] Speaker 05:
And I don't understand them to be making that argument.

[00:07:23] Speaker 05:
I thought, and I guess we'll hear from them, whether, I thought their position was the contracts just don't guarantee, they don't interpret the contracts the same way you do, that you are guaranteed under the contracts to have the irrigation water at the expense of anything else, such as ESA obligations.

[00:07:44] Speaker 01:
Well, these contracts, your honor were executed in the 1900s and 1910s and the contract language says things like the United States will store will impound will deliver water.

[00:07:55] Speaker 01:
So that is the focus of the language that there's a non discretionary obligation to deliver water.

[00:08:01] Speaker 01:
And there's nothing in the contract that allows reclamation to curtail that diversion for the benefit of species.

[00:08:07] Speaker 01:
I'm sharing time with the other appellant, and I'd like to reserve the remaining time for rebuttal.

[00:08:11] Speaker 05:
Thank you.

[00:08:11] Speaker 05:
So you'll be doing the rebuttal?

[00:08:14] Speaker 01:
Or you'll both?

[00:08:15] Speaker 01:
Mr. Reitman represents a different appellant, so we're sharing for 20 minutes.

[00:08:19] Speaker 05:
Oh, so you'll both be doing the rebuttal.

[00:08:21] Speaker 05:
OK, got it.

[00:08:21] Speaker 01:
Thank you.

[00:08:28] Speaker 04:
May it please the court, Nathan Reitman, representing Appellant, Klamath Irrigation District.

[00:08:32] Speaker 04:
I would like to reserve three minutes of my time.

[00:08:35] Speaker 04:
The district court's preemption ruling violates the Fifth Amendment to the United States Constitution because it takes a adjudicated water right, determined in the Klamath adjudication, that belongs to Klamath Irrigation District,

[00:08:48] Speaker 04:
and gives it to the United States of America for public use without payment of just compensation.

[00:08:54] Speaker 04:
There are three fundamental reasons the court made this unconstitutional ruling, three errors.

[00:08:59] Speaker 04:
First is that it erroneously viewed the Endangered Species Act as a source of authority that gives reclamation the right to use water.

[00:09:09] Speaker 04:
In reality, it's black letter law, the Endangered Species Act does not give agencies any authority they don't otherwise have under their enabling act.

[00:09:19] Speaker 04:
Second, the court applied a freewheeling obstacle preemption analysis instead of the direct conflict preemption analysis that is required under California of the United States.

[00:09:31] Speaker 04:
Third, the court failed to recognize that there are genuine issues of material fact for trial in regard to whether or to what extent the United States can comply with the Endangered Species Act, the Reclamation Act, the McCarran Amendment, and Oregon state law at the same time.

[00:09:48] Speaker 04:
And we've discussed those factual issues in the brief.

[00:09:51] Speaker 04:
So I would pause there.

[00:09:52] Speaker 04:
I'd be happy to answer any questions the court may have, or I can delve into these.

[00:09:55] Speaker 05:
Well, can you address this mootness question?

[00:09:58] Speaker 05:
Because I think we got a little hung up on it.

[00:10:01] Speaker 05:
And I don't know if we're asking the right questions.

[00:10:05] Speaker 05:
Yes, I would be happy to address it.

[00:10:07] Speaker 05:
It would help me.

[00:10:08] Speaker 05:
Where's the state litigation?

[00:10:09] Speaker 05:
Because isn't the whole issue here that there was a ORWD order

[00:10:16] Speaker 05:
That was addressed that's been withdrawn now correct right and that that allowed the original order allowed the irrigation district to get the water that it needed.

[00:10:28] Speaker 04:
So.

[00:10:29] Speaker 04:
Under Oregon law, 540-210, the Oregon Water Resources Department, if there's a dispute between a reservoir owner and a water user, the way the water rights are enforced is the complaining party goes to the Water Resources Department and tells them to distribute the water in accordance with state law.

[00:10:46] Speaker 04:
That's what we did.

[00:10:47] Speaker 04:
They didn't do it initially.

[00:10:48] Speaker 04:
We went to court, compelled them to do it.

[00:10:50] Speaker 04:
And they ruled in your favor, right?

[00:10:52] Speaker 04:
Right.

[00:10:52] Speaker 04:
So the court, yes, the court ruled.

[00:10:53] Speaker 04:
But now that's been withdrawn.

[00:10:56] Speaker 04:
after the court entered an injunction, after the court below here entered an injunction.

[00:11:00] Speaker 05:
The federal court.

[00:11:01] Speaker 04:
The federal court entered an injunction saying that they're barred from enforcing it.

[00:11:06] Speaker 04:
And at the same time that they withdrew it, we say that that's procedurally improper.

[00:11:12] Speaker 04:
And that's the state court proceeding that you're talking about in that, OK, if they want to issue a different order, that's fine.

[00:11:18] Speaker 04:
But they have to issue an order on how the water is distributed in accordance with state law.

[00:11:22] Speaker 02:
You mean there's just a vacuum now?

[00:11:24] Speaker 02:
Is that what you're?

[00:11:25] Speaker 04:
Essentially, yes.

[00:11:26] Speaker 05:
I thought that was on appeal.

[00:11:28] Speaker 05:
So maybe that's where my misunderstanding is.

[00:11:30] Speaker 05:
I thought you had appealed the withdrawal and said, no, you can't withdraw it.

[00:11:37] Speaker 04:
Yes, because the order that OWRD issued, the United States challenged it in this case.

[00:11:42] Speaker 04:
We also challenged it because there was an aspect of that order that we also did not like in terms of how it viewed evaporation.

[00:11:50] Speaker 04:
Then OWRD, in response to this court's ruling and the fact that the state court ruling compelling it to

[00:11:56] Speaker 04:
decided the issue was thrown out on technical grounds, it withdrew the order to the Bureau, and then we went, we are saying, no, you can't just withdraw it and say nothing.

[00:12:09] Speaker 04:
You have to give us a final order to challenge.

[00:12:11] Speaker 04:
What is your determination about how water is distributed?

[00:12:15] Speaker 04:
in light of the federal court ruling.

[00:12:16] Speaker 04:
I mean, how much water under the ESA is reclamation entitled to divert down the river?

[00:12:21] Speaker 04:
We don't know.

[00:12:22] Speaker 04:
The decision in this case doesn't say it.

[00:12:24] Speaker 05:
And there's no pending decision in the Oregon state on this issue?

[00:12:33] Speaker 04:
In the state court case I'm talking about specifically, we have it stayed pending the outcome here because there's a lot of resources being expended.

[00:12:41] Speaker 02:
What exactly has stayed?

[00:12:46] Speaker 04:
Our KID's contention that OWRD has to issue a different order in lieu of the one that it withdrew that says how water is distributed.

[00:12:58] Speaker 04:
This court has said for now that

[00:13:02] Speaker 04:
ESA water goes downstream, okay, how much?

[00:13:06] Speaker 04:
Like, it needs to determine, these issues aren't decided by this case.

[00:13:09] Speaker 02:
Right, we have no control over that.

[00:13:12] Speaker 04:
Right, I'm not asking you to decide that.

[00:13:14] Speaker 02:
Okay.

[00:13:15] Speaker 04:
And the thing I submitted yesterday, which was also in the record anyway, but prior to the 2020-2021 court ruling compelling OWRD to issue some type of order that was appealed and thrown out on technical grounds, there was an earlier 2018 order

[00:13:32] Speaker 04:
compelling them to distribute water based on state law.

[00:13:37] Speaker 04:
And the irrigation season ran out.

[00:13:38] Speaker 04:
They didn't really, you know.

[00:13:41] Speaker 04:
But anyway, that order has been appealed.

[00:13:43] Speaker 04:
That appeal's been dismissed.

[00:13:45] Speaker 04:
I mean, that's President Dukata.

[00:13:46] Speaker 04:
They are under an order to distribute water in accordance with state law.

[00:13:49] Speaker 04:
State law requires them to distribute water in accordance with state law.

[00:13:52] Speaker 05:
But you don't have an order to that effect right now.

[00:13:56] Speaker 04:
Right.

[00:13:56] Speaker 04:
However, and I mean, the United States can characterize its own pleadings.

[00:13:59] Speaker 04:
I think if you look at what they were asking for, they were talking about any and all successor orders, paragraph 10 of their... They wanted to enjoin those orders.

[00:14:07] Speaker 05:
That was their counterclaim.

[00:14:08] Speaker 04:
Their counterclaim is the United States or the state of Oregon cannot make an order.

[00:14:13] Speaker 05:
I said enjoin.

[00:14:14] Speaker 05:
That's wrong.

[00:14:15] Speaker 05:
They wanted to hold those orders preempted basically.

[00:14:18] Speaker 04:
Right.

[00:14:18] Speaker 04:
And any other order like them.

[00:14:21] Speaker 02:
But the issue here with respect to the Endangered Species Act is still going to be an issue.

[00:14:28] Speaker 04:
Correct.

[00:14:28] Speaker 04:
And the other thing I mentioned in what I submitted yesterday is it's a little bit different.

[00:14:33] Speaker 04:
But substantially similar issue is pending in US District Court right now.

[00:14:38] Speaker 04:
It's a case that we filed in the adjudication saying that, hey, they can't distribute water this way, contrary to the adjudication.

[00:14:45] Speaker 04:
And it's, as a practical matter, sitting there kind of waiting for this to resolve.

[00:14:50] Speaker 04:
But, I mean, this is a live, live issue.

[00:14:53] Speaker 05:
Okay.

[00:14:54] Speaker 05:
Do you want to reserve time?

[00:14:56] Speaker 04:
I want to reserve three minutes each.

[00:14:57] Speaker 05:
Yeah, three minutes each.

[00:14:58] Speaker 05:
Okay.

[00:15:09] Speaker 03:
May it please the court, good morning, John Smeltzer for the Bureau of Reclamation and the National Marine Fisheries Service.

[00:15:16] Speaker 03:
Let me start also with the jurisdictional questions, so hopefully we can clear that issue up.

[00:15:22] Speaker 03:
And I want to start with the district court's decision, and particularly page two of the decision, which is at one, KID excerpts of record four.

[00:15:32] Speaker 03:
The discourse specifically granted summary judgment in favor of the United States on the first cause of action in the United States cross-claim.

[00:15:41] Speaker 03:
And then it issued two points.

[00:15:43] Speaker 03:
It said, number one, the Bureau must comply with the ESA in operating the Klamath Project.

[00:15:47] Speaker 03:
And number two, the OW order is preempted by the ESA and thus violates the Supremacy Clause.

[00:15:53] Speaker 03:
The withdrawal of the order raises some questions about the second part.

[00:15:59] Speaker 03:
We submit that there is still a live controversy with respect to the overarching issue, the controlling issue that really controls the second question.

[00:16:06] Speaker 05:
Which is whether you have an obligation under the ESA.

[00:16:09] Speaker 03:
Whether the ESA section seven applies to the project as a whole.

[00:16:14] Speaker 03:
That's the basic question.

[00:16:15] Speaker 03:
When the court says, does the ESA apply to project operations, the district court is talking about the way it's being operated.

[00:16:24] Speaker 03:
The way that the reclamation is

[00:16:27] Speaker 05:
is operating the project in accordance with the essay that is uh... consulting on the essay with respect to the project so we have to your position is we have to decide it sounds like there's agreement we have to decide that question nobody's really disagree that we have to decide the seven the section seven obligations that's correct but you would agree well i don't know what your position on the second one as far as that i mean this is strange because we don't have it we don't have a state court order

[00:16:57] Speaker 05:
to know what the baseline is by which we're comparing the obligations.

[00:17:03] Speaker 03:
What we submit is the declaratory judgment, summary judgment, and the injunction on the second point are controlled by the decision on the first.

[00:17:14] Speaker 03:
What Reclamation did is generate an operating plan based on the understanding that the ESA applies to the project as a whole.

[00:17:23] Speaker 03:
That is, to the storage of water in Upper Klamath Lake and to the diversion of water

[00:17:27] Speaker 03:
for irrigation purposes.

[00:17:30] Speaker 03:
And that obligation conflicts with the order to the extent that the order says you can't release stored water.

[00:17:39] Speaker 03:
Where there is that conflict, it conflicts with the operating plan and it doesn't allow

[00:17:44] Speaker 05:
So all you would have us do, I'm just trying to simplify this, all you want us to do is decide the ESA obligation issue and then the state court can go back and figure out, okay, now taking that into account, what can we

[00:18:00] Speaker 05:
what can we do?

[00:18:02] Speaker 05:
What does state law allow for the diversion?

[00:18:05] Speaker 03:
How much water needs to be diverted?

[00:18:07] Speaker 03:
Your Honor, I'm not sure we'd agree that there's a role for the state court to play necessarily.

[00:18:12] Speaker 05:
I said state court, it's really the OWRD, but you don't even agree with that.

[00:18:18] Speaker 03:
Ultimately not necessarily.

[00:18:19] Speaker 03:
I mean it depends on what what owrd is attempting to enforce right if there is a senior user on On the Klamath River in Oregon that has a dispute with the project, you know priority administration.

[00:18:35] Speaker 03:
That's something that owrd Needs to do and can do The dispute in this case has involved downstream water rights in California

[00:18:44] Speaker 03:
And that's phase two, that's not before the court at the moment, but we submit that that's an interstate issue that's not within OWRD's jurisdiction or the jurisdiction of the state court under the KBA.

[00:18:56] Speaker 03:
With respect to the Endangered Species Act, the issue is can the reclamation operate the project in this manner, right?

[00:19:04] Speaker 03:
Do consultation on the project as a whole.

[00:19:06] Speaker 03:
whether or not there are any downstream water rights, right?

[00:19:10] Speaker 03:
Assuming that there are, no.

[00:19:12] Speaker 05:
And so on the main issue that you're asking us to decide, does that boil down to whether there's a man, whether these agreements give you discretion or not to divert any of the water?

[00:19:25] Speaker 03:
I think that's essentially right.

[00:19:26] Speaker 03:
There are two questions the court asks, always determine whether Section 7 is applicable, right?

[00:19:32] Speaker 03:
The first question is, is there federal agency action?

[00:19:35] Speaker 03:
The second question is, is that federal agency action discretionary, right?

[00:19:41] Speaker 03:
Both of those issues need to be addressed in this case because the case law that KWA is citing, some of it applies more specifically to the first issue.

[00:19:51] Speaker 03:
Is there agency action?

[00:19:52] Speaker 03:
And some to the second issue.

[00:19:55] Speaker 03:
And I submit that those issues, while they overlap, they are separate issues.

[00:20:00] Speaker 05:
What about the Patterson case?

[00:20:03] Speaker 05:
Which issue does that, in your opinion, apply to?

[00:20:06] Speaker 03:
Ultimately both, Your Honor.

[00:20:08] Speaker 03:
We believe, of course, the Supreme Court's decision in home builders came down after Patterson.

[00:20:13] Speaker 03:
So it raised questions about what is that discretionary, you know, what do you need for agency discretion?

[00:20:18] Speaker 03:
But let me start with both the issues and explain how it applies, right?

[00:20:24] Speaker 03:
So on the question of agency action, right, the court has to understand how the project is operated.

[00:20:31] Speaker 03:
Reclamation doesn't physically operate the project, right?

[00:20:33] Speaker 03:
Reclamation contracted with Pacific Corps

[00:20:36] Speaker 03:
to operate Link River Dam, which controls the storage, and then Reclamation contracted with the parties, the water users, over the distribution of and the supply of Project Water, and those contracts give the water users the authority to operate the diversion works and the distribution works, as Ms.

[00:20:58] Speaker 03:
Johnson mentioned.

[00:21:00] Speaker 03:
So Reclamation's not physically doing, you know, pulling the levers, it's Pacific Corps,

[00:21:05] Speaker 03:
It's the water users.

[00:21:07] Speaker 03:
Reclamation operates the project by instructing the different groups how to run the project, right?

[00:21:13] Speaker 03:
And so the question is, does Reclamation have that authority, right?

[00:21:17] Speaker 03:
Patterson reviewed the contract with Pacific Corps and said, yes, the authority to run the dam.

[00:21:25] Speaker 03:
It's still an agency action.

[00:21:27] Speaker 03:
Yes, right.

[00:21:28] Speaker 03:
Because the authority to operate the dam, Pacific Corps had no water right, right?

[00:21:33] Speaker 03:
They didn't have any ability to say, we want to run the dam in this way to generate power.

[00:21:38] Speaker 03:
They have no water right.

[00:21:39] Speaker 03:
And so Reclamation could step in and say, we're running the dam for irrigation purposes.

[00:21:44] Speaker 03:
But that's Reclamation's duty and authority.

[00:21:48] Speaker 03:
The contract, as Miss Johnson notes in her brief, has expired.

[00:21:53] Speaker 03:
But that doesn't change the holding of Patterson, because what Patterson was about was what was reserved in the contract, what was Reclamation's inherent authority under the statute.

[00:22:03] Speaker 03:
and under the other contracts.

[00:22:05] Speaker 03:
Reclamation doesn't give away the authority over the dam and any other contracts.

[00:22:10] Speaker 03:
So it's an authority that was reserved.

[00:22:13] Speaker 03:
Patterson said we still had it when the contract was in effect.

[00:22:17] Speaker 03:
We still have it now.

[00:22:18] Speaker 03:
The contract has expired.

[00:22:19] Speaker 03:
Pacific Corps is still operating the dam.

[00:22:22] Speaker 02:
We're in a transition or reclamation.

[00:22:25] Speaker 02:
So what did home builders do to that?

[00:22:28] Speaker 03:
Well, that's the second piece.

[00:22:29] Speaker 03:
And if your honor does mind, one other point on agency action.

[00:22:35] Speaker 03:
The agency, the other thing that Reclamation is responsible for doing for operating the project as a whole is determining the available water supply.

[00:22:43] Speaker 03:
There is no, nothing in the contracts that puts an amount that each water user has, right?

[00:22:50] Speaker 03:
There's just the obligation to supply water from available water.

[00:22:55] Speaker 03:
And then each individual user's right is based on contractual priorities and equitable proportioning, which Reclamation reserved the authority to do.

[00:23:08] Speaker 03:
So Reclamation not only controls the storage, but Reclamation determines what's available for use by all the irrigators.

[00:23:19] Speaker 03:
And so that's what makes this case

[00:23:21] Speaker 03:
different from Sierra Club B, but different from Epic Simpson and different from NRDCV Holland, right?

[00:23:29] Speaker 03:
Because it's talking about the specific obligation, affirmative obligation, continuing obligation to supply water by storing it and then determining what's available.

[00:23:40] Speaker 03:
So to the homebuilder's point.

[00:23:41] Speaker 02:
That's the agency action.

[00:23:42] Speaker 03:
That's the agency action.

[00:23:43] Speaker 03:
So when you get to the question of discretion, right, which was raised in homebuilders, this court,

[00:23:51] Speaker 03:
addressed what that means in its en banc decision in NRDC v. Juul.

[00:23:58] Speaker 03:
The KWA cites that standard in their reply brief at page three.

[00:24:05] Speaker 03:
And the standard, as they cite, says, if another legal obligation makes it impossible for the agency to exercise discretion for the protected species benefit, then there's no discretion.

[00:24:19] Speaker 03:
What KWA left out of that quotation in the reply brief is the word only.

[00:24:25] Speaker 03:
What this court said is only if another legal obligation makes it impossible for the agency to exercise discretion for the protection of a species benefit does, only in that circumstance is there no discretion to comply with the ESA.

[00:24:39] Speaker 03:
And so what we are saying with respect to discretion is, if you, and I come straight out of Home Builders, right, because there was a mutually prohibitive

[00:24:47] Speaker 03:
statutory duties, right, in the Clean Water Act and the Endangered Species Act.

[00:24:52] Speaker 03:
And this court said, look, where one act says you have to do something specific upon certain specific conditions, you know, no exceptions, that's a mandatory duty.

[00:25:03] Speaker 03:
You can't add anything.

[00:25:05] Speaker 03:
The ESA can't add anything there.

[00:25:08] Speaker 03:
But that's the only circumstance where you don't have discretion.

[00:25:11] Speaker 03:
The statutes in this case,

[00:25:13] Speaker 03:
are statutes that provide open-ended authority.

[00:25:17] Speaker 03:
The authority to build reclamation projects, the authority to operate projects, the authority to enter contracts.

[00:25:24] Speaker 05:
But could the contracts impose that obligation?

[00:25:26] Speaker 05:
If the United States had contracts that said, look, we're going to allocate this amount of water to the irrigation districts, presumably that would take away your discretion.

[00:25:37] Speaker 05:
That's not what the contracts say, is it?

[00:25:39] Speaker 03:
That's not what the contracts say.

[00:25:41] Speaker 03:
And it's also, I mean, it depends on if they say we will supply this subject to availability and subject to the ESA, then even that contract chart wouldn't apply.

[00:25:50] Speaker 03:
Well, obviously that would carve it out.

[00:25:51] Speaker 03:
That's O'Neill.

[00:25:52] Speaker 03:
That's the exact case in O'Neill.

[00:25:54] Speaker 03:
That's what O'Neill said, right?

[00:25:55] Speaker 03:
In this case, we have even more discretion, because we don't have the specific amount.

[00:26:00] Speaker 03:
But what we have is that shortage clause modifying the contractual duty to supply.

[00:26:09] Speaker 03:
And that's what's different than O'Neill.

[00:26:11] Speaker 03:
It's also different from NRDC v. Holland, the case that was most recently decided, because that's a case that involved pre-project rights, where the United States is agreeing that certain rights exist.

[00:26:22] Speaker 03:
It's agreeing that the

[00:26:24] Speaker 03:
the irrigators can exercise those rights without interference from the Bureau of Reclamation.

[00:26:31] Speaker 03:
And, Your Honor, in that case, the issue was reinitiation of ESA consultation on contract renewal.

[00:26:38] Speaker 03:
So it was really about, was there discretion to change the contract terms that were exercised by the project users, which is different from supply.

[00:26:47] Speaker 03:
So what we submit is the shortage

[00:26:51] Speaker 03:
clauses have to be read in the context of the entire contract, have to be read against the background of the statute.

[00:26:58] Speaker 03:
And in that context, O'Neill still controls, Patterson relied on O'Neill, and that's why Patterson addressed the second part as well.

[00:27:07] Speaker 03:
uh... cited o'neill and cited the fact that uh... these contracts are subject to the essay because of what o'neill held and that's what so can i can i have this so how does the oregon law still apply if at all here because oregon law still has to control

[00:27:22] Speaker 05:
the rights, it ultimately is the arbitrator.

[00:27:25] Speaker 05:
I mean, arbiter of who has the rights under Oregon law.

[00:27:30] Speaker 05:
Now apparently we're injecting the ESA on top of that, but do we need to consider Oregon law?

[00:27:39] Speaker 05:
And should the district court have considered Oregon law in making its determination?

[00:27:44] Speaker 03:
Yeah, Oregon law applies to the extent that it provides the project water right.

[00:27:49] Speaker 03:
It provides the maximum project water right.

[00:27:51] Speaker 03:
It says where water can be diverted, at what volumes, and all those sorts of things.

[00:27:56] Speaker 03:
The ESA acts as a restriction on the exercise of the water right.

[00:28:01] Speaker 03:
And that's where we part company with KID, talking about their arguments of takings and whatnot.

[00:28:08] Speaker 03:
But what KID seems to

[00:28:10] Speaker 03:
to miss is that what Oregon law or what the ESA is doing here is operating on the exercise of a law to right.

[00:28:17] Speaker 05:
Well, I understand that, but don't, I mean, I guess that's why I'm asking whether there's a fundamental Oregon question of Oregon law that we have to delve into, or would you say no, in order to give you the relief that you're seeking, we just need to look at the ESA and the discretionary function under the contracts, that's it.

[00:28:37] Speaker 05:
We don't have to consider Oregon law.

[00:28:39] Speaker 03:
I think it's just the intersection to resolve the arguments that KID raises.

[00:28:44] Speaker 03:
It's just the intersection of the ESA and the fundamental property law principle, which is also a principle of Oregon law, which is property rights are discretionary.

[00:28:54] Speaker 03:
Property rights themselves are permissive.

[00:28:56] Speaker 03:
You can choose to operate, to exercise the law to write or not.

[00:29:00] Speaker 03:
And the reclamation is choosing to operate,

[00:29:06] Speaker 03:
I don't want to suggest to the court that reclamation has absolute discretion to choose when to exercise its rights, right?

[00:29:13] Speaker 03:
It has contractual obligations, but the contractual obligations are then subject, per the contract terms, to the overriding law.

[00:29:20] Speaker 03:
So reclamation is not just choosing willy-nilly not to exercise its rights, but what it's saying is when the ESA intersects with that property right, the property right gives way, and that's not contrary to state law, right?

[00:29:36] Speaker 03:
that when the ESA puts a restriction on the exercise of a property, it doesn't violate any state law principle.

[00:29:43] Speaker 03:
And I want to draw the court's attention to one sort of nuance of state law and water law.

[00:29:49] Speaker 03:
We say in our brief, and I said here again, that property rights, they can be impacted by the ESA in their exercise.

[00:30:00] Speaker 03:
And it's the same is true for water rights.

[00:30:02] Speaker 03:
It's not different.

[00:30:03] Speaker 03:
And that's what this case is really about.

[00:30:06] Speaker 03:
There's a nuance with respect to water law, which is kind of a use or lose principle.

[00:30:11] Speaker 03:
If you don't use your water right, you can lose it.

[00:30:15] Speaker 03:
But in Oregon law, Oregon says that forfeiture principle does not apply if the water right cannot be used as a matter of law.

[00:30:27] Speaker 03:
Oregon's law specifically

[00:30:29] Speaker 03:
recognizes that there are circumstances where there may be an overriding law, like the ESA, that prevents the use of a water right.

[00:30:36] Speaker 03:
That's consistent with the original.

[00:30:39] Speaker 05:
Oh, OK.

[00:30:40] Speaker 05:
Let's give some time.

[00:30:41] Speaker 05:
It sounds like you're splitting here three ways.

[00:30:44] Speaker 05:
So Ms.

[00:30:44] Speaker 05:
Goldman, is that?

[00:30:47] Speaker 05:
Thank you, Mr. Smeltzer.

[00:30:49] Speaker 00:
Thank you, and may it please the court.

[00:30:52] Speaker 00:
My name is Patty Goldman.

[00:30:53] Speaker 00:
I represent the Yurok tribe and the commercial fishing groups.

[00:30:57] Speaker 00:
I would like to address jurisdiction, the Holland case, and the question of how does Oregon law apply if I have time.

[00:31:04] Speaker 00:
On justiciability.

[00:31:06] Speaker 00:
Under the Declaratory Judgment Act, if there is an actual controversy that's amenable to a judicial resolution, then the court can issue such an order.

[00:31:17] Speaker 00:
As we said in our brief, we think the threshold question of whether Section 7 applies to operation of the project is such an issue, but there are many other issues that have been presented by the water users that go too far.

[00:31:30] Speaker 00:
like which actions are discretionary and should be in the next operation plan, what should be in the baseline, interpretations of each and every contract, and whether there's a takings of water rights.

[00:31:42] Speaker 05:
But the interpretation of the contract does seem to be before us, because doesn't that go to whether it's mandatory or discretionary under the ESA?

[00:31:50] Speaker 00:
It does.

[00:31:51] Speaker 00:
And if you look at the core contracts, then there is ample discretion.

[00:31:56] Speaker 05:
You're just saying there's other ancillary contracts that aren't relevant.

[00:32:00] Speaker 00:
And there are like almost 200 contracts.

[00:32:03] Speaker 05:
Anything you can do to keep us from having to read 200 contracts would be helpful.

[00:32:07] Speaker 00:
Yeah.

[00:32:08] Speaker 00:
And I think the question of whether there's some discretion for purposes of Section 7 can be answered first as a matter of statute and the delegated authority to operate the reclamation acts and engage in any and all acts that are necessary and proper.

[00:32:23] Speaker 00:
This court and National Wildlife Federation and the San Luis and Delta Mendota case

[00:32:28] Speaker 00:
has held that that broad language leaves ample discretion.

[00:32:32] Speaker 00:
And that really addresses the homebuilder's case.

[00:32:35] Speaker 00:
On the contracts, the core contracts, which are the bulk of the water for the original project and have seniority, authorize reclamation to apportion deliveries when there are shortages for drought and other causes.

[00:32:49] Speaker 00:
And that language, drought and other causes, was construed in O'Neill

[00:32:54] Speaker 00:
to include endangered species at compliance.

[00:32:56] Speaker 00:
It is not the same language as in Holland, contrary to what Ms.

[00:33:00] Speaker 00:
Johnson said.

[00:33:01] Speaker 00:
As to Holland, it was a very different question.

[00:33:04] Speaker 00:
It was reinitiation on a renewed contract.

[00:33:07] Speaker 00:
There was no question that Reclamation had to consult on the Central Valley Project as a whole.

[00:33:13] Speaker 00:
This Court has held as much, and it did so.

[00:33:15] Speaker 00:
There was no question that Reclamation had to consult on renewal of the contracts.

[00:33:20] Speaker 00:
And there's a very unusual provision in the renewed contract

[00:33:24] Speaker 00:
that obligates the contractors to abide by any requirements in the biological opinion on the renewal.

[00:33:32] Speaker 00:
So Section 7 consultation and requirements were baked in to the contract.

[00:33:38] Speaker 00:
There was really no question that Section 7 applied to the project as a whole and to the renegotiation.

[00:33:47] Speaker 00:
I'd like to turn to the question of how does Oregon law apply?

[00:33:52] Speaker 00:
This court has resolved that issue in the case called NRAE Klamath Irrigation District, where the court held that the Klamath Basin adjudication did not address Endangered Species Act compliance and did not address the contracts, which established the relationships between the districts and the Bureau.

[00:34:15] Speaker 05:
And therefore... That's different than the Patterson case.

[00:34:18] Speaker 00:
That is.

[00:34:19] Speaker 00:
That's just a recent case, just last year.

[00:34:23] Speaker 00:
And it was about the McCarran Amendment and whether the issues had to go back to the Klamath Basin Adjudication Court when they were about Endangered Species Act compliance.

[00:34:35] Speaker 00:
And this court held no.

[00:34:36] Speaker 00:
They did not because that court has no jurisdiction over them.

[00:34:39] Speaker 00:
Now that's a matter of federal law in this circuit precedent.

[00:34:42] Speaker 00:
We don't have an analog under Oregon law, and I am sure that Klamath Irrigation District is going to keep pressing this issue in state court.

[00:34:51] Speaker 00:
So, you know, there may be a conflicting ruling at some point under Oregon law.

[00:34:54] Speaker 00:
That is not the position that Oregon is taking.

[00:34:56] Speaker 05:
But even if there were conflicting, you would have preemption if we'd said that the ESA governs, right?

[00:35:06] Speaker 00:
Yes, and we believe that would be the proper determination.

[00:35:09] Speaker 05:
All right, I think we'll give one minute to whoever's up next.

[00:35:20] Speaker 06:
Good morning.

[00:35:21] Speaker 06:
Jay Weiner on behalf of the Klamath Tribes.

[00:35:23] Speaker 06:
And I think that your focus on this question of discretion and what the discretion of the Bureau of Reclamation is is absolutely the right place to be.

[00:35:31] Speaker 06:
There is not a need here to engage with substantive questions of Oregon law, because ultimately those questions of Oregon law

[00:35:37] Speaker 06:
will need to interrelate and adapt to what this panel's decision is in regard to the overarching controlling federal law.

[00:35:45] Speaker 05:
As much as we want them to go forward, they're kind of waiting.

[00:35:48] Speaker 05:
Everybody's in a standstill, waiting for everybody else.

[00:35:51] Speaker 06:
That is correct.

[00:35:52] Speaker 06:
Everyone is absolutely at a standstill.

[00:35:54] Speaker 06:
And the reason the Klamath tribes are here speaking this morning, in particular on this Oregon water law question, is that the Klamath tribes also have decreed water rights in the Klamath Basin adjudication that were determined in the ACFOD.

[00:36:05] Speaker 06:
And so these questions of the interpretation of Oregon law

[00:36:08] Speaker 06:
relate, very importantly, not just to the state law-based water rights that Klamath Irrigation District asserts, but to the federal law-based water rights that the Klamath tribes have determined in the adjudication.

[00:36:20] Speaker 05:
And these are all issues that get faced.

[00:36:23] Speaker 05:
It does seem odd if there's not enough water.

[00:36:28] Speaker 05:
It's like the ESA says, will the fish get it first?

[00:36:31] Speaker 05:
I mean, I guess that's the rule, but it seems counterintuitive that at some point we could have farmers who can't grow enough food for us.

[00:36:39] Speaker 05:
I guess there's some emergency hatch that would kick in.

[00:36:42] Speaker 06:
There's a few pieces in response to that question, Judge Nelson.

[00:36:48] Speaker 06:
the ESA provides one set of overlays.

[00:36:51] Speaker 06:
But the Klamath tribe's water rights, which are time immemorial water rights, senior to the water rights of the irrigators, are predicated on the tribe's treaty rights to hunt, fish, trap, and gather.

[00:37:01] Speaker 05:
But you agree that ESA even

[00:37:04] Speaker 06:
supersede your rights you're just saying in priority you've got ESA then you've got the tribes then you've got the So I appreciate you're asking that question because I don't concede that position That is not an issue that is on the face presented by this case.

[00:37:18] Speaker 06:
That's where we had we were looking for other issues I was I can give you about seven more if you want but I don't but the part of what generally what I'm here to do in part is to indicate that

[00:37:26] Speaker 06:
There are already the massive issues before you as well as a whole several other universes of issues that will need to be aligned around whatever it is the panel decides on the narrow issue presented in this case.

[00:37:40] Speaker 06:
We advocated to the district court to make a modest and narrow ruling, which the district court did.

[00:37:44] Speaker 06:
And we would encourage the panel to do the same thing, because this decision will ramify into a whole bunch of other proceedings that most likely, some of which will probably return to you, others will need to be fought out in state court and determined elsewhere.

[00:37:58] Speaker 06:
And so we, from the Klamath tribe's perspective, would just encourage you to rule as modestly and narrowly as possible, because any dicta that goes into the opinion is going to come up in a satellite.

[00:38:07] Speaker 02:
But you want the ESA to apply.

[00:38:10] Speaker 06:
We do.

[00:38:10] Speaker 06:
No, we support the position of the United States and the Yorick tribe in this case.

[00:38:13] Speaker 06:
Thank you.

[00:38:14] Speaker 06:
Thank you.

[00:38:24] Speaker 05:
So you agree there's a live controversy here then?

[00:38:26] Speaker 01:
Yes.

[00:38:27] Speaker 05:
Everybody basically agrees there's a live controversy.

[00:38:29] Speaker 01:
Yes, there was never a jurisdictional defense to either the cross claim or the counterclaim.

[00:38:35] Speaker 01:
And there are lots of sovereign parties here.

[00:38:37] Speaker 01:
So they would have asserted one.

[00:38:39] Speaker 01:
But I do want to emphasize that the counterclaim, KWA's first counterclaim, is not dependent on the OWRD order.

[00:38:45] Speaker 01:
It's asking for a declaration of reclamation's authority to curtail irrigation.

[00:38:52] Speaker 01:
It really doesn't deal.

[00:38:53] Speaker 05:
Has that already been decided in Ray Klamath irrigation case that was just mentioned?

[00:39:00] Speaker 01:
No, this issue has never been decided.

[00:39:03] Speaker 01:
What is discretionary under the contracts and under Reclamation's operation of the project and its authorizing legislation.

[00:39:11] Speaker 01:
It wasn't decided in Patterson either.

[00:39:13] Speaker 01:
That, as the United States described, that case dealt with the 1956 COPCO contract.

[00:39:20] Speaker 01:
And if you read the very first sentence of that opinion, it states the limitation, which this appeal involves a basic contract issue.

[00:39:27] Speaker 01:
whether KWA and other irrigators in the Klamath Basin are third-party beneficiaries to a 1956 contract between BOR and COPCO.

[00:39:36] Speaker 01:
It was talking about the COPCO contract.

[00:39:37] Speaker 05:
But doesn't Patterson also say that the ESA applies to the Link River dam?

[00:39:42] Speaker 01:
It says that there was the third party beneficiary analysis where the court went through the specific articles of the 1956 contract with COPCO.

[00:39:52] Speaker 01:
And then at the end, there was a discussion of whether Reclamation has authority to direct dam operations under the 1956 contract.

[00:40:03] Speaker 01:
So whether Reclamation, based on its contractual relationship with COPCO, could direct COPCO

[00:40:09] Speaker 01:
to operate the dam to comply with the ESA.

[00:40:12] Speaker 05:
It never decided the scope of the ESA obligations, and it never decided whether to... I understand that, but I thought one reading of it might be that that was dictated in Patterson, and it sounds like you're not taking that position.

[00:40:27] Speaker 01:
You're just saying... We would very much take the position that was dictated.

[00:40:30] Speaker 01:
It does not apply to...

[00:40:33] Speaker 01:
There was never Patterson dealt with the 1956 copco contract and all the statements about reclamations authority to direct or take over the dam that's under that's contract its contractual relationship with copco that

[00:40:48] Speaker 01:
contract has expired, and it's really not an issue.

[00:40:51] Speaker 01:
And there have been so many cases since Patterson that the United States really has to confront and deal with, including just last month in NRDC v. Holland, the California Sport Fishing Protection Alliance v. FERC case.

[00:41:05] Speaker 01:
Epic.

[00:41:06] Speaker 01:
Babbit.

[00:41:07] Speaker 01:
In response to Ms.

[00:41:07] Speaker 01:
Goldman's characterization of NRDC v. Holland, that was incorrect.

[00:41:11] Speaker 01:
The question on those water contracts was whether the ESA continued to apply to the performance of the executed contract based on the contract terms.

[00:41:23] Speaker 01:
So it is directly on point, and it's holding on articles 3i and 3h of those settlement contracts, those long-term water contracts, is directly on point to the language in the Klamath supply contracts

[00:41:35] Speaker 01:
about whether drought and other causes or legal obligations can give reclamation authority to just reduce water deliveries at its discretion.

[00:41:44] Speaker 05:
I just have a few other- Sorry, but you're splitting time, as I understand it, so we probably ought to give two and a half minutes to your colleague.

[00:41:51] Speaker 05:
Thank you.

[00:41:52] Speaker 05:
Thank you.

[00:41:56] Speaker 04:
Thank you, Your Honors.

[00:41:57] Speaker 04:
A few quick high-level points I want to get to.

[00:41:59] Speaker 04:
And the first and most important one is that this discussion is absolutely backwards.

[00:42:05] Speaker 04:
You cannot figure out how much discretion the Bureau has under the ESA until you know what authority it has under the water rights to use water.

[00:42:17] Speaker 05:
Water is distributed based on... Does that mean you're saying that the state court has to give them that?

[00:42:27] Speaker 04:
Yes, in the adjudication.

[00:42:29] Speaker 04:
Water is distributed based on water rights.

[00:42:31] Speaker 04:
It is not distributed based on GSA.

[00:42:33] Speaker 05:
What would you have us do?

[00:42:34] Speaker 05:
You would have us wait.

[00:42:38] Speaker 05:
I thought you asked the state court to wait for our decision.

[00:42:42] Speaker 04:
What I would have you do on the discrete issue, the issue that KID is concerned with, is reclamation is diverting water that KID has been determined in the adjudication to own.

[00:42:52] Speaker 04:
It doesn't own it.

[00:42:54] Speaker 04:
It is diverting that water and it is using it for in-stream purposes.

[00:42:58] Speaker 04:
The question, does it have discretion to do that?

[00:43:00] Speaker 04:
You can't answer that question without knowing whether or not it has a water right to use the water, unless you want to hold that the ESA provides a right that doesn't exist in the Reclamation Act, doesn't exist in the water rights to use water.

[00:43:13] Speaker 04:
Going to your question about the Link River Dam in Patterson, for example, at that time, the water rights had not been determined.

[00:43:19] Speaker 04:
So the court said, yeah, they have discretion under the ESA to operate that dam however they wanted, because at that point in time,

[00:43:27] Speaker 04:
The bureau had the authority to use water, however it wanted.

[00:43:30] Speaker 04:
But once the water rights were determined in the Klamath Basin adjudication, its discretion was limited.

[00:43:35] Speaker 05:
But what would you have us do?

[00:43:36] Speaker 05:
Would you have us do a, I mean, do we have to look at Oregon law and determine what the water rights are under Oregon law?

[00:43:44] Speaker 04:
I would have you certify the question.

[00:43:45] Speaker 04:
I mean, to the extent there's confusion about it, I would certify the question to the Oregon Supreme Court.

[00:43:49] Speaker 04:
and ask the Oregon Supreme Court, does Oregon law allow- That's not even really feasible here.

[00:43:55] Speaker 05:
You'd never get an answer within any reasonable time of what you would need to act.

[00:44:00] Speaker 02:
Well, we have to have an answer because answering- What is the question that you would certify?

[00:44:05] Speaker 04:
Whether, under Oregon law, reclamation can divert stored water from Upper Klamath Lake for use in the in-stream use in the Klamath River without a water right.

[00:44:17] Speaker 05:
If it can, because your position is that they can't then there's no discretion and therefore the ESA doesn't.

[00:44:21] Speaker 04:
If you don't have a water right, you can't use water.

[00:44:24] Speaker 04:
The ESA does not give you a water right.

[00:44:26] Speaker 04:
And the thing is you talk about changing discretion.

[00:44:28] Speaker 04:
We're talking about contracts.

[00:44:30] Speaker 04:
The reclamation has no discretion to change the water rights.

[00:44:34] Speaker 04:
None.

[00:44:34] Speaker 05:
Okay.

[00:44:35] Speaker 05:
Can I?

[00:44:37] Speaker 05:
We would normally end.

[00:44:38] Speaker 05:
I would like to hear for 30 seconds from Mr Smeltzer about this last point about certifying a question to the Oregon Supreme Court.

[00:44:45] Speaker 05:
Can you give the United States position on this?

[00:44:48] Speaker 03:
Quickly, Your Honor, I think the issues have been settled.

[00:44:52] Speaker 03:
There's been a case that was already certified to the Oregon Supreme Court in the Bailey litigation that began, it was originally called Calamity Irrigation District.

[00:45:01] Speaker 00:
Is it certified yet?

[00:45:01] Speaker 03:
No, no, no, the Federal Circuit.

[00:45:03] Speaker 03:
It was certified from the Federal Circuit, and it was a question about when there are jointly owned rights, I mean, how does it

[00:45:12] Speaker 03:
What is the nature of the right of the of the party that didn't appropriate the water?

[00:45:18] Speaker 03:
It's a slightly different circumstance because you think this has already been addressed.

[00:45:22] Speaker 03:
Well, partially there and partially there.

[00:45:25] Speaker 03:
What the court said is that the contracts determine the nature of the water rights, right?

[00:45:31] Speaker 03:
When when parties.

[00:45:32] Speaker 03:
Like when we appropriate water to provide to supply to irrigation districts and it's made on condition of a contract, the contract is baked into the property.

[00:45:41] Speaker 03:
Do you think we just need to look to the contracts?

[00:45:43] Speaker 03:
We don't need to certify this to the Oregon law or Oregon Supreme Court?

[00:45:47] Speaker 03:
Correct.

[00:45:47] Speaker 03:
And it's also because it's this fundamental question about the non-exercise of a right.

[00:45:53] Speaker 05:
Well, I agree, but there is something to this idea that if, I mean, if under Oregon law, there's no discretion for the Bureau of Reclamation, then doesn't that answer the ESA question?

[00:46:04] Speaker 03:
Right.

[00:46:05] Speaker 03:
As I explained, that's just not Oregon law.

[00:46:09] Speaker 03:
OWRD agrees on that point as well in their brief.

[00:46:14] Speaker 05:
All right.

[00:46:14] Speaker 03:
Thank you.

[00:46:15] Speaker 05:
Thank you to all counsel for your arguments in the case.

[00:46:19] Speaker 05:
And the case is now submitted, and we're in recess till tomorrow.

[00:46:23] Speaker 01:
All rise.