For decades, the U.S. Forest Service has said it can’t say “no” to a mine on its land.

Now, the recent federal court ruling overturning approval of the Rosemont Mine on service land near Tucson will make it harder for the Forest Service to say “yes.”

Legal experts say U.S. District Judge James Soto’s July 31 ruling, if upheld in higher courts, will have national repercussions.

They’re using words like “chaos,” “shocking” and “blockbuster” to discuss the ruling’s ramifications.

The ruling could chill the hard-rock mining industry that has lived under a generally favorable legal climate since Congress passed the 1872 Mining Law to encourage mineral exploration of public lands.

Mining industry lawyers say the ruling usurps the role of government agencies in making such decisions, could bring chaos to federal mining reviews and will add more delays in permitting to an industry already having some of the longest permit times for new mines in the Western world.

Environmental law professors say the ruling is well-grounded factually and could end a century-old practice by mining companies of skirting or dodging federal law by dumping mining wastes on federal lands without proper reviews.

They say it also exposes what they see as the fallacy of having our public-lands mining governed by a law written at a time when picks and shovels were used to pull minerals from the ground.

Soto’s order is “likely the most significant federal court decision on federal mining law in several decades,” mining industry lawyers James Allen and Michael Ford of the Phoenix-based law firm Snell and Wilmer wrote in an online article.

It “will likely be received with shock throughout the hard rock mining industry,” they wrote.

John Leshy, a former Interior Department solicitor and a retired law professor, called the ruling a “blockbuster” that could finally lead to reform of the 1872 law — an effort that has repeatedly failed in Congress over the past four decades.

In the meantime, the ruling, if upheld, would make opening a big new mine in the United States on public lands very hard, said Leshy, professor emeritus at the University of California-Hastings College of Law.

The judge’s findings

Soto overturned the Forest Service’s approval of the mine, which would create 500 full-time jobs at high wages and 2,500 construction jobs, but would disturb 3,653 acres of national forest.

Rosemont also would disturb and desecrate 33 ancient Native American burial grounds containing or likely containing human remains of ancestors of the Tohono O’Odham, Pascua Yaqui and Hopi tribes, the judge wrote, as he ruled on two lawsuits, filed by four environmental groups and the other by the three tribes.

The opponents’ lawsuits successfully argued that only public lands directly above valuable mineral deposits are covered by the federal 1872 Mining Law’s definition of mining rights.

The judge found that the Forest Service had erred in approving Rosemont without determining the validity of the mining claims on 2,447 acres of public land where Hudbay Minerals Inc. wants to dump the mine’s waste rock and tailings.

Source: The Star georeferenced an image in a Hudbay Minerals Inc. technical report of the Rosemont Mine layout plan.

To prove validity under the 1872 law, Soto wrote, Hudbay would have had to show that the land contained valuable mineral deposits, which he said the company had failed to do.

Allen, an attorney in Snell and Wilmer’s Tucson office, said: “This ruling that says you have to consider the validity of a mining claim in this context, that’s brand new. Ordinarily, validity disputes, based on discovery of a valuable mineral deposit, came up when you have two rival claimants going after the same deposit.”

Rosemont, a planned open-pit copper mine in the Santa Rita Mountains southeast of Tucson, was ready to start construction on Aug. 1.

Now, it faces delays of up to 24 months before the 9th Circuit Court of Appeals can rule on an anticipated appeal of Soto’s decision.

In the meantime, mining industry lawyer Stuart Butzier of Albuquerque said the ruling will “chill investment in domestic mining on any significant scale” and cause mining companies to look at other countries.

Said industry lawyer Daniel Jensen of Salt Lake City: “It will simply provide one more alternative for challenging the agency’s actions in court, which is never a quick process. It will slow things down.”

Soto’s ruling effectively holds that the feds cannot say “yes” to a proposal to dump mine tailings on invalid mining claims, said Mark Squillace, a University of Colorado law professor. Mining claims can only be used to extract the minerals located there, he said.

“Since dumping tailings on the claims could make it difficult or almost impossible to develop the claims going forward, Rosemont seems to be admitting that the claims do not contain valuable minerals and thus are not valid claims,” Squillace said.

The ruling will almost certainly force the industry to push Congress to overturn it, said Leshy, who worked as an informal, unpaid consultant to attorneys pressing the Rosemont suit.

“Otherwise, the Bureau of Land Management and the Forest Service will have the ability to decide whether and how to allow hard-rock mining companies to use public lands as dumps, including requiring them to pay the U.S. fair market value for that use,” he said.

“The ruling would treat those companies just like most others who seek to use public lands for profit, and the industry is not used to being treated that way,” Leshy said.

Industry attorney Allen, one of the few legal experts interviewed who didn’t take sides on Soto’s ruling, was less convinced that it would choke off all new mines. He said companies can always go back to the agencies and try to find ways to make their projects work legally.

If the ruling slows projects another two years, after Rosemont has taken 12 years to get permitted, “how much slower can it get?” he asked.

But “my sense” is that now with this ruling, industry officials may be more open to some modifications of the 1872 law if that would give them more certainty about the outcome of future permit issues, he said.

In the end, companies do not care what legal regime they are working under as long as there’s some degree of certainty, Allen said.

Waste disposal on public lands

Since the 1872 Mining Law passed, mining companies have legally dealt with their need to dispose of waste rock and tailings in two ways.

They have placed them, as Hudbay wants to do, on federal land on which they have filed “unpatented” mining claims, on which they don’t own the land but own its mineral rights.

Or, they have created what are known as mill sites to let them put wastes on those lands. That doesn’t require proof of a valuable mineral deposit but is limited to 5 acres per mining claim.

Legal experts on both sides of the issue say the use of unpatented claim land for mine wastes without a check on their validity has survived largely unchallenged until now.

Leshy, during his Interior solicitor’s tenure, wrote a legal opinion abolishing the practice, but the Bush administration overturned it during the 2000s.

In the Rosemont case, the mining claim validity issue first came up in December 2006, in a letter from Pima County Administrator Chuck Huckelberry to then-Coronado National Forest Supervisor Jeanine Derby.

This was during the early stages of company efforts to win federal approval to build the mine on 955 acres of private and federal land, with the open pit eventually reaching 3,000 feet deep and 6,000 feet in diameter.

To get access to copper, molybdenum and silver from the mineral ores, Rosemont must extract a total of 1.2 billion tons of waste rock, material containing no economic value, as Soto noted, and about 700 million tons of tailings.

Noting that Rosemont hadn’t proposed to “extract, remove or market” minerals associated with its claims on land slated for waste disposal, Huckelberry said, “This brings up the very obvious question of whether the claims are valuable if claimants do not propose to improve them but instead propose to use them as a dumping ground.”

“To save itself, taxpayers, interested parties and the claimant much time and money,” he urged the service to force Rosemont to prove that the claims are valid.

No way, Derby wrote back two months later.

She said she had received opinions from the service’s Office of General Counsel and a geologist in the service’s regional Albuquerque office that it’s not common practice or Forest Service policy to challenge claim validity.

The exceptions would occur when a mining company wants to operate on land where the service has already forbidden mining; when someone applies to “patent” a claim by getting it as their property; and when the service determines that a company’s proposed land use isn’t related to mining.

Nearly seven years later, in the final Rosemont environmental impact statement, the service said that putting waste rock and tailings on forest land is considered to be connected to mining under federal rules.

“As such, they are authorized activities regardless of whether they are on or off mining claims.” That means their validity isn’t an issue, the statement said.

In a response to the environmentalist lawsuit, Hudbay and the service said this year “the record is inconclusive” as to whether the land with unpatented claims has valuable minerals.

“However, past exploration has indicated that the area surrounding the Rosemont deposit may contain valuable mineral deposits,” they said.

Soto’s ruling bought into Huckelberry’s arguments, saying Rosemont’s proposal to bury its unpatented claim land with waste “was a powerful indication that there was not a valuable mineral deposit underneath that land.”

Geological studies and maps indicate primarily common sand, stone and gravel lie beneath the land: “This does not constitute a valuable mineral,” Soto wrote.

He noted that the Forest Service and Hudbay cited two federal laws passed a half-century apart that say mining can’t be prohibited on federal lands. One, the Multiple Use Act of 1955, also prohibits interfering with “reasonably incidental mining activities” on federal lands, which Rosemont says its waste disposal would be.

But those laws only protect mining activities permitted under the 1872 Mining Law, which isn’t the case for Rosemont’s dumping tailings and waste rock on non-valid claimed land, the judge wrote.

Environment vs. property rights

This ruling’s most significant feature is that it “breaks down the wall” between mining law and environmental law by placing a longstanding issue about the validity of mining claims into a new realm — the federal approval of a new mine under the National Environmental Policy Act, industry attorney Allen said.

Typically, mining law deals with property rights and environmental law does not. This case raises the possibility of environmental law being brought to bear on property rights, he said.

From now on, every time a company submits a mining plan to the Forest Service or BLM for approval, their plans would be at risk unless they include some kind of a mineral exam, he said.

The ruling ignores an agency’s right to not challenge or question the validity of an unpatented mining claim if it chooses, industry attorney Jensen said.

“The judge seems to believe the agency is required to do that in every case, which is not the law,” Jensen said. “The agency has discretion to do that any time it wants. It is not compelled to do it.”

Soto has pretty much usurped the agency’s role in this area, Jensen added.

“If that happened all the time, it would be chaos in the administrative world,” Jensen said. “The agency has regulations for analyzing the validity of claims, and they do challenge mining claims from time to time.

“If someone can go to court and convince a judge that a judge alone can undertake some sort of analysis on her or his own, suggesting that record is invalid and claims are invalid, that circumvents the administrative process,” Jensen said.

Industry attorney Butzier said the part of Soto’s opinion dealing with the principles of the 1872 Mining Law, public lands and multiple use “strike me as pretty sound. He’s clearly thought that through, and done research into principles that apply to public lands law, in particular related to the 1872 law.”

Butzier’s concerns lie first with his view that “it’s not clear that Rosemont had the opportunity to put forward evidence as to whether there was a valuable mineral deposit” under the lands slated for waste disposal.

Second, he is concerned that the court’s use of the National Environmental Policy Act to handle challenges to mining claims is the wrong forum.

“To me, that’s an apples-and-oranges detour from the purpose of NEPA, which is to evaluate alternatives for a proposed action affecting the human environment,” he said.

Attorney Jensen’s view is what former Interior Solicitor Leshy said he expects will be the industry and government’s arguments during an appeal.

“It’s basically saying, the government can stick its head in the sand and not look at the obvious, and the courts should not intervene to stop it. It’s kind of a ‘prosecutorial discretion’ argument — the government gets to decide when and whether to challenge the validity of mining claims,” he said.

But although the government gets a good deal of deference, it can’t act “arbitrarily and capriciously,” said Leshy, citing a phrase from Soto’s ruling.

“It is arbitrary and capricious for the government to close its eyes to the plain facts in front of it — these mining claims used for tailings piles do not have minerals that can be profitably mined and are therefore invalid, and that means the company does not have a right to use them for that purpose.”

Law professors Squillace and Jan Laitos of the University of Denver praised Soto’s ruling as sound.

“I think Rosemont is going to have a tough time justifying that they are valid claims when the intent is to bury them with waste,” said Squillace. He said he was interviewed but not formally consulted by lawyers for mine opponents.

The whole purpose of the 1872 Mining Law was to grant people rights to the minerals if they could be developed, Squillace said.

Laitos called the ruling a wake-up call to mining companies that they must be sure they can convince the feds they have made a mineral discovery.

“I don’t know what the facts are. I don’t know if the judge had the facts right. But as a matter of law, the judge is completely correct,” Laitos said.

“If you don’t have that trigger of the valuable mineral discovery, you don’t have the right to use that land.”

MORE: Opinion: Location thoughts on Rosemont Mine

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Contact reporter Tony Davis at tdavis@tucson.com or 806-7746.

On Twitter: @tonydavis987