A divided panel of the Ninth U.S. Circuit Court of Appeals has allowed two water districts and two farmers to sue the federal government for damages caused by changes in the management of the Central Valley Water Project, even though the districts and farmers have not yet experienced an injury. The decision appears to set an important precedent regarding when a party has the legal "standing" to seek compensation for damages. The court ruled that the districts and farmers need not wait until the new water management practices turned their water excessively saline before demanding compensation. "The injury alleged has not yet occurred; it is threatened," Justice Stephen Reinhardt wrote for the court. "Nevertheless, the possibility of injury may be sufficient to confer standing on plaintiffs; threatened injury constitutes ‘injury in fact.'" In 1992, Congress approved the Central Valley Project Improvement Act to address environmental concerns with the huge federal water project. The act required the Bureau of Reclamation to manage Central Valley rivers and streams to increase salmon populations; to dedicate 800,000 acre-feet of water to aid fish, wildlife and habitat restoration; and to develop a program to meet these goals in accordance with State Water Resources Control Board permits. Those permits, among other things, set a standard for salinity at the confluence of the San Joaquin and Stanislaus rivers known as the Vernalis standard. The Bureau then began releasing water for fishery habitat purposes from the New Melones Reservoir into the Stanislaus River during April, May and October — key months for fishery health. The Central Delta Water Agency, the South Delta Water Agency and two farmers within the districts sued the federal government in 1999. District Court Judge Oliver Wanger ruled that the agencies and farmers did not have standing to pursue their claims. But a 2-1 panel of the Ninth Circuit overturned the lower court's decision. The key issue for the Ninth Circuit was whether the water districts and farmers had suffered "injury in fact" because a hypothetical injury is not enough to establish standing. The farmers argued that the Bureau's method of operating New Melones Dam was highly likely to cause water salinity levels that violated the Vernalis standard, thus hampering their ability to grow crops. They pointed to a Bureau modeling study that predicted the new plan would cause the Vernalis standard to be violated at least one month a year in 41% of the subsequent 71 years. They further cited three Clean Water Act cases in which environmentalists were given standing, even though there was only a threat of actual harm to the environment in each case. The cases were Ecological Rights Foundation v. Pacific Lumber Co., 230 F.3d 1141 (9th Cir. 2000) (see CP&DR Legal Digest, December 2000); Friends of the Earth v. Gaston Copper Recycling Corp., 204 F3d 149 (4th Cir. 2000); and Friends of the Earth v. Laidlaw, 528 U.S. 167 (2000) (see CP&DR Legal Digest, February 2000). The federal government argued that those cases were inapplicable because they all involved ongoing violations of the Clean Water Act, and they only provided that violation of the statute was sufficient to confer an aggrieved party with standing. The court, however, found the cases on point. "Standing resulted not from the existence of an ongoing statutory violation, but because of the threatened future damage to plaintiff's environmental interests," Reinhardt wrote of the three cases. He then extended that reasoning to this case. "[W]e conclude that the necessary showing for standing purposes is not that the Vernalis standard has already been exceeded or that plaintiffs' crops have already been damaged by excessively saline water, but that plaintiffs face significant risk that the crops that they have planted will not survive as a result of the Bureau's decisions to discharge water from the New Melones Reservoir during April, May and October, rather than when needed to meet the Vernalis standard," Reinhardt wrote. "The threat of injury resulting from the Bureau's employing an operational plan that will likely lead to violations of the Vernalis standard is sufficient to confer standing on plaintiffs." Because the farmers have standing, the agencies — which are charged under state law with protecting a dependable supply of high-quality water — have standing as well, the court ruled. The Ninth Circuit further ruled that the district court was wrong to block the lawsuit on the basis that previous administrative and judicial proceedings had settled the management of New Melones Dam. The Ninth Circuit held that earlier lawsuits did not address the same issue, namely the release of water pursuant to the Bureau's operation plan for environmental purposes. The Ninth Circuit returned the case to the lower court for further proceedings. In a short dissent, Judge Ferdinand Fernandez said the water districts and farmers had not proven the "invasion of legally protected interest" was more than hypothetical. "What is significant here is the fact that the United States has not violated any law, rule, regulation, or contract," Fernandez wrote. "Nor has it threatened that it will do so in the future." The Case: Central Delta Water Agency v. United States, No. 01-16172, 02 C.D.O.S. 10525, 2002 DJDAR 12140. Filed September 26, 2002. Amended October 21, 2002. The Lawyers: For Central Delta: Daniel McDaniel, (209) 465-5883. For the U.S.: David Shilton, Department of Justice, (202) 514-2000.