September 25, 2014

Court of Appeal deals a blow to the state's ban on suction dredge mining

By Jonathan Wood Attorney

The California Court of Appeal has issued a decision that seriously undermines California’s ban on suction dredge mining. Adopting the argument of our amicus brief, the Court held that a state ban forbidding all commercially beneficial use of a federal mining claim is preempted by federal mining law.

Brandon Rinehart has a federal mining claim in a streambed in the Plumas National Forest. He claims that the only way he can work this claim is by using suction dredge mining equipment. However, California has banned the use of such equipment, citing environmental concerns. When Rinehart worked his claim anyway, he was criminally prosecuted.

As the Court recognized, this is a serious problem. Federal law expressly encourages individuals to find valuable resources on federal land and mine them. As the Supreme Court has explained, Congress’ intent is “to reward and encourage the discovery of minerals that are valuable in an economic sense.” States may not frustrate Congress’ purposes by prohibiting this activity on federal land.

The Court of Appeals held that state regulations are:

rendered unenforceable [if they] have rendered the exercise of rights granted by the federal mining laws “commercially impracticable.”

The Court stopped short of declaraing the ban unconstitutional because the trial court had refused to allow Rinehart an opportunity to introduce evidence required to show that he needed a suction dredge to work his claim in a commercially practicable manner. On remand, the trial court must allow that evidence and address two questions:

(1) Does section 5653.1, as currently applied, operate as a practical matter to prohibit the issuance of permits required by section 5653; and (2) if so, has this de facto ban on suction dredge mining permits rendered commercially impracticable the exercise of defendant’s mining rights granted to him by the federal government?

This is a serious win for miners. By acknowledging that federal mining rights are frustrated if mining is commercially impracticable, the Court rejected the state’s argument that the ban isn’t preempted so long as any inconvenient and unprofitable means to work these claims remain. Or, as we explained in our amicus brief:

By making the mining of streambeds on federal land cost-prohibitive, the moratorium limits mining in these areas to recreational panning for gold and other methods that do not permit the profitable development of these resources. As a result of the ban, the owners of mining claims on federal lands … are unable to make a living from their claims.

Because most if not all streambed mining claims require a suction dredge to mine, the state may seek review in the California Supreme Court rather than waiting for all the evidence to pile up on remand.

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