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Lawyers, other representatives, expert(s), tribunal’s secretary


Frequently Used Abbreviations and Acronyms
ACEC Area of Critical Environmental Concern
ACHP Advisory Council on Historic Preservation
APA Administrative Procedures Act
APE Area of Potential Effect
ARPA Archaeological Protection Act of 1979
ATCC Area of Traditional Cultural Concern
att. Attachment
BLM Bureau of Land Management
CAPM Capital Asset Pricing Model
CDCA California Desert Conservation Area
CDPA California Desert Protection Act of 1994
CEQA California Environmental Quality Act
CMA California Mining Association
CRB California Research Bureau
DOC Department of Conservation
DCF Discounted Cash Flow
DEIR Draft Environmental Impact Report
DEIS Draft Environmental Impact Statement
DOI Department of the Interior
EA Environmental Analysis
EIR Environmental Impact Report
EIS Environmental Impact Statement
Ex. Exhibits submitted by Claimant
FA Factual Appendices submitted by Respondent
FEIR Final Environmental Impact Report
FEIS Final Environmental Impact Statement
FLPMA Federal Land Policy and Management Act of 1976
FTC Federal Trade Commission
IBA International Bar Association
ICPBD Imperial County Planning and Building Department
ICSID International Centre for Settlement of Investment Disputes
IVCDM Imperial Valley College Desert Museum
LA Legal Authorities submitted by Respondent
LAO California Legislative Analyst’s Office
MMPA Mining and Minerals Policy Act of 1970
MOA Memorandum of Agreement
NAFTA North American Free Trade Agreement
NAGPRA Native American Graves Protection and Repatriation Act of 1990
NAHC Native American Heritage Commission
NAS National Academy of Science
NHPA National Historic Preservation Act of 1966
NEPA National Environmental Policy Act of 1970
NOI Notice of Intent
NOP Notice of Preparation
NRC National Research Council
NRHP National Register of Historic Places
OHP Office of Historic Preservation
OMR Office of Mine Reclamation, Department of Conservation
POO Plan of Operations
ROD Record of Decision
SB Senate Bill
SHPO State Historic Preservation Officer
SIH Substantial Irreparable Harm
SMARA Surface Mining and Reclamation Act of 1975
SMGB State Mining and Geology Board
Tbl. Table
TCP Traditional Cultural Property
Tr. Transcripts of the Hearing on the Merits
THPO Tribal Historic Preservation Officer
UNESCO United Nations Educational, Scientific and Cultural Organization
UNCITRAL United Nations Commission on International Trade
VE Validity Examination
VER Valid Existing Right




Glamis Gold, Ltd. ("Glamis"), a Canadian mining company, brings this proceeding against the United States of America, claiming that the United States breached obligations owed to it under Chapter 11 of the North American Free Trade Agreement ("NAFTA"). In particular, Glamis claims that the United States expropriated rights possessed by Glamis to mine gold in southeastern California and that the United States denied Glamis fair and equitable treatment in its attempts to utilize those rights.
In this section, the Tribunal articulates its understanding of its task in this proceeding initiated under the NAFTA Chapter 11 structure and provides a summary of its decision.

A. The Tribunal’s Understanding of Its Task: Undertaking a Case-Specific Arbitration with Awareness of the NAFTA Chapter 11 System

Simultaneously, as this NAFTA Tribunal addresses the particular case before it, it necessarily does so aware of the larger context in which it operates. Tribunals are not only aware of the objectives and experience of the NAFTA; they are aware that the NAFTA State Parties: decided to allow the two non-disputing States in any particular arbitration to submit observations,1 established procedures for the possible consolidation of arbitrations involving the same questions of fact or law,2 more recently decided to make the record and awards of all arbitrations publicly available,3 and—in response to the requests of interested parts of civil society—made possible limited submissions by such non-parties.4
The reality is that Chapter 11 of the NAFTA contains a significant public system of private investment protection. The ultimate integrity of the protections given to the many individual investments made under Chapter 11 is ensured by reference to a multitude of arbitral panels occupied by persons who are only occasionally reappointed. The ultimate integrity of the Chapter 11 system as a whole requires a modicum of awareness of each of these tribunals for each other and the system as a whole.
The fact that any particular tribunal need not live with the challenge of applying its reasoning in the case before it to a host of different future disputes (the challenge faced by standing adjudicative bodies) does not mean such a tribunal can ignore that challenge. A case-specific mandate is not license to ignore systemic implications. To the contrary, it arguably makes it all the more important that each tribunal renders its case-specific decision with sensitivity to the position of future tribunals and an awareness of other systemic implications.
Therefore, this Tribunal, in undertaking its primary mandate of resolving this particular dispute, does so with an awareness of the context within which it operates. The Tribunal emphasizes that it in no way views its awareness of the context in which it operates as justifying (or indeed requiring) a departure from its duty to focus on the specific case before it. Rather it views its awareness of operating in this context as a discipline upon its reasoning that does not alter the Tribunal’s decision, but rather guides and aids the Tribunal in simultaneously supporting the system of which it is only a temporary part.
In this proceeding, the Tribunal’s awareness of the context in which it operates may be summarized as aiding its case-specific task in terms of five principles:

• First, a tribunal should confine its decision to the issues presented by the dispute before it. The Tribunal is aware that the decision in this proceeding has been awaited by private and public entities concerned with environmental regulation, the interests of indigenous peoples, and the tension sometimes seen between private rights in property and the need of the State to regulate the use of property. These issues were extensively argued in this case and considered by the Tribunal. However, given the Tribunal’s holdings, the Tribunal is not required to decide many of the most controversial issues raised in this proceeding. The Tribunal observes that a few awards have made statements not required by the case before it. The Tribunal does not agree with this tendency; it believes that its case-specific mandate and the respect demanded for the difficult task faced squarely by some future tribunal instead argues for it to confine its decision to the issues presented.

• Second, inasmuch as the State Parties to the NAFTA have agreed to allow amicus filings in certain circumstances, it is the Tribunal’s view that it should address those filings explicitly in its Award to the degree that they bear on decisions that must be taken. In this case, the Tribunal appreciates the thoughtful submissions made by a varied group of interested non-parties who, in all circumstances, acted with the utmost respect for the proceedings and Parties. Given the Tribunal’s holdings, however, the Tribunal does not reach the particular issues addressed by these submissions.

• Third, it is important that a NAFTA tribunal provide particularly detailed reasons for its decisions. All tribunals are to provide reasons for their awards and this requirement is owed to private and public authorities alike. In the Tribunal’s view, however, it is particularly important that the State Parties receive reasons that are detailed and persuasive for three reasons. First, States are complex organizations composed of multiple branches of government that interact with the people of the State. An award adverse to a State requires compliance with the particular award and such compliance politically may require both governmental and public faith in the integrity of the process of arbitration. Second, while a corporate participant in arbitration may withdraw from utilizing arbitration in the future or from doing business in a particular country, the three NAFTA State Parties have made an indefinite commitment to the deepening of their economic relations. In this sense, not only compliance with a particular award, but the longterm maintenance of this commitment requires both governmental and public faith in the integrity of the process of arbitration. Third, a minimum level of faith in the system is maintained by the mechanism for the possible annulment of awards. However, the time and expense of such annulments are to be avoided. The detailing of reasons may not avoid the initiation of an annulment procedure, but it is hoped that such reasons will aid the reviewing body in a prompt resolution of such motions.5

• Fourth, a NAFTA tribunal need communicate its holding not only clearly, but also succinctly. The previous principle’s call for detailed reasons, however, likely leads to a lengthy award that does not necessarily communicate its conclusions succinctly to the various branches of government or public involved. For this reason, the Tribunal provides an executive summary of the Award in what we hope is direct yet still legally precise language, with references to the details within. This summary is to be fully understood in terms of the more detailed exposition contained in the Award.

• Fifth, a NAFTA tribunal, while recognizing that there is no precedential effect given to previous decisions, should communicate its reasons for departing from major trends present in previous decisions, if it chooses to do so. As our recently departed colleague, Thomas Walde, stated in his separate opinion to International Thunderbird Gaming Corp. v. Mexico:

In international and international economic law - to which investment arbitration properly belongs - there may not be a formal ‘stare decisis’ rule as in common law countries, but precedent plays an important role. Tribunals and courts may disagree and are at full liberty to deviate from specific awards, but it is hard to maintain that they can and should not respect well-established jurisprudence. WTO, ICJ and in particular investment treaty jurisprudence shows the importance to tribunals of not ‘confronting’ established case law by divergent opinion - except if it is possible to clearly distinguish and justify in-depth such divergence. The role of precedent has been recognised de facto in the reasoning style of tribunals, but can also be formally inferred from Art. 1131 (1) of the NAFTA - which calls for application of the ‘applicable rules of international law’,...6

In terms of its case-specific mandate, a tribunal should decide the matter before it on the basis of the authorities submitted to it, and to the degree that the parties to the dispute do not raise what the tribunal regards to be a particularly relevant authority, the tribunal should bring such an authority to the attention of the parties and provide them an opportunity to comment. But, regardless of whether the particular line of reasoning was argued to the tribunal, it is our view that the tribunal should indicate its reasons for departing from a major trend of previous reasoning.7 This reasoning is partially apparent in this Award’s evidentiary approach to the requirement of fair and equitable treatment under Article 1105.

The Tribunal reiterates that it in no way views its awareness of the context in which it operates as justifying (or indeed requiring) a departure from its duty to focus on the specific case before it.

B. A Summary Statement of the Tribunal’s Award

Glamis, a Canadian company, undertook from 1994 to 2002 to mine gold at the Imperial Project, on federal land in southeastern California, utilizing mining rights it owns. The federal mining laws of the United States generally, and the open pit leach pad mining process that Glamis intended to employ specifically, are the subject of some public attention. The fact that the federal public lands on which Glamis possesses mining rights is near to—but not a part of—designated Native American lands and areas of special cultural concern added to the attention given to the mining project.
Glamis brings this proceeding against the United States of America claiming that the United States breached obligations owed to it under Chapter 11 of the NAFTA. Glamis argues: (1) that the federal government, through various acts, wrongfully delayed consideration of its proposed project, and (2) that, when there appeared to be possible approval at the federal level, the State of California adopted both legislation and regulations concerning the proposed project that rendered the project economically infeasible. In particular, Glamis claims that the United States, through both the federal and state actions, expropriated the mining rights possessed by Glamis in violation of Article 1110 of the NAFTA and that the United States, through both the federal and state actions, denied Glamis the fair and equitable treatment required by Article 1105 of the NAFTA.
This arbitration is procedurally noteworthy in that it involved the exchange and production of a significant number of documents, raising both questions of the scope of a party’s right to seek production of documents held by the other party and, if such a right existed with regard to a particular document, the scope of privileges to withhold such documents nonetheless.8 The Tribunal adopted an iterative process whereby it provided layers of guidance to the Parties that structured the elements of their document requests and responses to one another and aided them in their negotiations as to document exchange. Ultimately, the good faith efforts of the Parties in implementing the guidance provided by the Tribunal meant that only a small number of documents required individual production decisions by the Tribunal. The Tribunal’s decision on a yet smaller number of the documents requested but covered by a conditional privilege was deferred to the consideration of the merits out of respect for the purposes of the privilege and until such time as the materiality of those documents became clear.9 The extensive Party-driven document production aspect of this proceeding required time, but it is the Tribunal’s view that the active involvement of the Tribunal in providing guidance to the Parties both expedited and limited the extent of the effort.10
There were two preliminary objections by the United States. With respect to the assertion that Glamis relied upon actions more than three years preceding its knowledge of the asserted breach and damages, the Tribunal finds that such events were raised merely as "factual predicates" and were not in fact relied upon for Glamis’ claim under Article 1105.11 With respect to the challenge of ripeness, the Tribunal determines that, to the extent Claimant argues that its claim is that the California measures rendered the Imperial Project worthless upon their passage, the claim is ripe for review. Secondarily, however, to the extent Claimant argues that the Imperial Project would never be approved by the State of California, its claim is not ripe.12
The Tribunal denies Glamis’ Article 1110 claim that its federally granted mining right was expropriated on the ground that the right was never rendered substantially without value by the actions of the U.S federal and State of California governments for the reasons elaborated below.13
It is not contested in this proceeding that Glamis still formally possesses its federally granted mining right. Glamis claims that, although it is still in possession of the right as a formal matter, the value of that right was so diminished by governmental action that it was expropriated in fact. A substantial portion of the argumentation in this Arbitration was devoted to the value of the right that allegedly was taken from Glamis. For Glamis, this argument was an assertion of the compensation due to it. For the United States, this argument was an assertion that Glamis in fact still possesses a valuable right and that in fact no expropriation has occurred.14
In making its own evaluation of whether the Imperial Project retained value following the California backfilling measures, for reasons discussed extensively in the Award, the Tribunal starts with the values and methodologies offered by Claimant for the several elements of its valuation, reviews them one-by-one with Respondent’s objections to each, and makes adjustments that the Tribunal considers appropriate in light of the facts presented. This approach—namely, the Tribunal’s acceptance of Claimant’s assumptions as a starting point—is a best case scenario for Claimant. In essence, this approach asks: "Even if the Tribunal accepts Claimant’s pre-backfill measures valuation as correct and further accepts Claimant’s characterization of the factors resulting in a reduced value, does a review of the claimed reduction, and the resulting adjustments by the Tribunal, result in a radical diminution in the value of the Imperial Project?"15
Glamis argues in this proceeding that the Imperial Project, at the time of the alleged expropriation, had a value of $49.1 million. The Tribunal concludes that, when its adjustments are applied to Glamis’ valuation methodology, the post-backfilling valuation of the Imperial Project should be in excess of $20 million. In light of this significantly positive valuation, the Tribunal holds that the first factor in any expropriation analysis is not met: the complained of measures did not cause a sufficient economic impact to the Imperial Project to effect an expropriation of Glamis’ investment. The Tribunal thus holds that Glamis’ claim under Article 1110 fails.16
The Tribunal denies Glamis’ Article 1105 claim that it did not receive fair and equitable treatment from both the US federal government and the State of California during its efforts to utilize its federally granted mining right, on the ground that Glamis Gold has not established that any of the cited actions, whether viewed individually or together as a whole, violate the obligation of the United States to provide fair and equitable treatment for the reasons elaborated below.17
In some bilateral investment treaties, the phrase "fair and equitable treatment" is viewed as autonomous treaty language. It is not contested at this point in time that the reference in Article 1105 to "fair and equitable treatment" is to be understood not as autonomous treaty language but in terms of customary international law. The content of that rule, however, remains unsettled.18 The Tribunal therefore devotes substantial analysis to this question.19
Approaching the task of ascertaining the customary international law standard of "fair and equitable treatment," the Tribunal employs a mode of reasoning that differs from some of the awards it has reviewed. The Tribunal emphasizes that the task of seeking the meaning of "fair and equitable treatment" by way of treaty interpretation is fundamentally different from the task of ascertaining the content of custom. A tribunal confronted with a question of treaty interpretation can, with little input from the parties, provide a legal answer. It has the two necessary elements to do so, namely the language at issue and rules of interpretation. A tribunal confronted with the task of ascertaining custom, on the other hand, has a quite different task because ascertainment of the content of custom involves not only questions of law but also questions of fact, where custom is found in the practice of States regarded as legally required by them.20 The content of a particular custom may be clear; but where a custom is not clear, or is disputed, then it is for the party asserting the custom to establish the content of that custom.21
Respondent additionally argues that, in reviewing State agency or departmental decisions and actions, international tribunals, as well as domestic judiciaries, should defer to the agency so as not to second guess the primary decision-makers. The Tribunal disagrees that domestic deference in national court systems is necessarily applicable to international tribunals particularly where a measure of deference is already present in the standard to be applied.27
With this standard (as elaborated in this Award) in mind, the Tribunal finds that the acts of the federal government and the State of California complained of by Glamis do not, either individually or collectively, violate the Article 1105 obligations of the United States. Specifically, the Tribunal finds the following measures did not violate Respondent’s international obligations under Article 1105:

• A legal opinion by the Department of the Interior did not breach Respondent’s obligations under Article 1105, because it was not arbitrary or manifestly without reasons; was not blatantly unfair or evidently discriminatory; nor did it repudiate expectations formed by a quasi-contractual relationship or evidence a complete lack of due process.28

• The Record of Decision denying Claimant’s Plan of Operations did not breach international obligations as it was based upon the above-mentioned legal opinion which was in compliance with Respondent’s international obligations.29

• With respect to the asserted delay in the federal government’s review of Claimant’s Plan of Operations, the Tribunal finds that, prior to Claimant’s submission to arbitration, there was no delay in the processing; and Respondent’s subsequent failure to diligently pursue administrative review while also defending an arbitration with respect to the same review is not manifestly arbitrary, completely lacking in due process, exhibiting evident discrimination, or manifestly lacking in reasons.30

• The cultural review of Claimant’s Plan of Operations did not breach Article 1105, as it was undertaken by qualified professionals who provided their reasoned and substantiated opinions upon which Respondent was justified in relying, and was not harmed by bias or prejudice. In addition, the conclusion of the cultural review culminating in direct recommendation to the secretary of Interior was not manifestly arbitrary, a gross denial of justice, or exhibiting a manifest lack of reasons.31

• The complained of California legislation was of general application and did not target Claimant’s investment, though it is likely that the investment served as a triggering event.32 The legislation also did not breach Respondent’s obligations to protect investor expectations, as such expectations were not created by specific assurances;33 nor was it arbitrary in that it is clear from the record that the legislation addressed some, if not all, of the harms at issue.34

• The California regulations, and the emergency regulations that preceded them, did not upset reasonable investor expectations as such expectations were not created by specific assurances.35 The Tribunal also finds that there was a rational relationship between the regulations and their purpose and sufficient scientific study to support the Board’s conclusions.36

• With respect to Claimant’s contention that the California measures were closely related acts with the same goal of halting its investment, the Tribunal holds that, even if it were to view the measures as "working together," Claimant has not met its burden of proving to the Tribunal that either measure unfairly targeted its investment.37

Finally, the Tribunal views the measures of both the federal and state governments together, to see whether the entirety of the conduct breaches international obligations when the individual events do not. The Tribunal determines that, for acts that do not individually violate Article 1105 to nonetheless breach that Article when taken together, there must be some additional quality that exists only when the acts are viewed as a whole, as opposed to individually. It is not clear, in general terms, what such quality would be in all circumstances though, in this factual situation, the Tribunal holds that it cannot see that the conduct as a whole is a violation of the fair and equitable treatment standard.38
The Tribunal thus dismisses both of the claims by Glamis Gold against the United States. The Tribunal holds that, with respect to the costs of this proceeding, Glamis shall bear two-thirds of the costs and the United States one-third, and each Party should bear its own individual costs of representation.


A. Disputing Parties

1. Glamis Gold, Ltd.

"Glamis Gold, Ltd. was a publicly held Canadian corporation engaged in the exploration, development and extraction of precious metals in the United States and Latin America."39 Incorporated in 1972, under the laws of the Province of British Columbia, Canada, a majority of Glamis’ directors are Canadian citizens.40 Claimant is an investor of Canada, a Party to the NAFTA. On November 4, 2006, Glamis Gold, Ltd. and Goldcorp, Inc., also a Canadian company, merged.41 For purposes of this Arbitration and simplicity in the proceeding and this Award, the Parties and the Tribunal will continue to refer to Claimant as "Glamis" or "Claimant."
Claimant’s headquarters, including its management, mine development staff and administrative personnel, was located in Reno, Nevada, U.S.A., and had been since 1998.42 Claimant states that it chose this location because its early success as a company was based primarily on gold exploration and development activities in the United States.43 In particular, Claimant successfully developed and operated two large open-pit gold mines in the California desert throughout the 1980s and 1990s: the Rand Mine in Kern County and the Picacho Mine in Imperial County.44
Through wholly owned subsidiaries, Claimant operates open-pit gold and silver mines in the State of Nevada, elsewhere in the United States and in Latin America. In Claimant’s view of the success of the nearby Rand and Picacho Mines, Claimant formed the Glamis Imperial Corporation to develop and operate the Imperial Mine, less than 10 miles from the Picacho Mine.45

2. United States of America

The United States of America ("Respondent") is a party to the NAFTA. Actions of Respondent, at the levels of both the federal and California state governments, were challenged by Claimant. As stated by the Metalclad tribunal, "parties to [the NAFTA] must ‘ensure that all necessary measures are taken in order to give effect to the provisions of the [NAFTA], including their observance... by state and provincial governments.’"46 Therefore, the complained of measures, at both the federal and state levels of government, are considered as acts of State by Respondent and are thus both defended by Respondent.

3. The Imperial Project47

The Imperial Project is located in eastern Imperial County, east of San Diego, California near the Arizona and Mexico borders. It occupies 1,631 acres of federal public lands, in the southern portion of the California Desert Conservation Area ("CDCA") on Class L lands.48 Claimant planned to construct the mine on a south- and west-facing alluvial plain to the south of the Indian Pass Area of Critical Environmental Concern ("ACEC")49 in the Chocolate Mountains, between the Cargo Muchacho Mountains (approximately four miles south) and Peter Kane Mountain (approximately six miles north).50 The proposed mine and processing area would lay near the center of the mining district formed by the active Picacho, Mesquite and American Girl mines.51
Around 1987, Claimant began to acquire interests in the approximately 187 Imperial County unpatented lode mining claims and 277 mill sites that form the basis of the Imperial Project.52 Over several years, through business partnerships, joint ventures and acquisitions, Claimant secured sole ownership of these claims.53 According to Claimant, between 1987 and 1994, Claimant conducted "an extensive exploration drilling program in the Imperial Project area with multiple [Bureau of Land Management (‘BLM’)] approvals" to locate, if any, valuable mineral deposits such as gold and silver.54
Through open-pit mining techniques, Claimant planned to mine gold and silver with the expectation of removing 150 million tons of ore, and 300 million tons of waste rock,55 from three large open pits during the Project’s projected 19-year life (from 1998 to 2017).56 The ore would have been processed on-site through conventional cyanide heap-leach processing,57 yielding an estimated 1.17 million ounces of gold and possibly another 0.5 million ounces through continued exploration.58 This process was to require three open pits, a heap leach facility (including a heap leach pad and process ponds), two waste rock stockpiles, and ancillary facilities.59
The proposed Plan of Operations for the Imperial Project provided for the sequential mining and backfilling of two of the three pits through a practice known as sequential backfilling.60 Through this process, waste rock would be initially placed adjacent to the first mined pit, but in subsequent pits, waste rock would be placed directly in the previously mined pits. Due to the costs inherent in this process, Claimant had not planned to completely backfill the third pit.61 Instead, the third pit would be partially backfilled and reclaimed with waste rock. Claimant also proposed various reclamation techniques, including grading, capping and re-vegetation, though the third pit, at approximately 4,700 feet in length, 2,700 feet in width and over 800 feet deep,62 would remain open for potential future mining.63
Claimant projected that the three mines would require initial capital expenditures of approximately $48 million and additional annual expenditures of $27.7 million for costs associated with operations and maintenance.64

B. The Domestic Regulatory Landscape

1. Federal Mining and Related Law

a. The Mining Law of 1872

The primary federal law governing the establishment of mining rights on federal land in the United States is the Mining Law of 1872 ("Mining Law").65 The Mining Law states that all valuable mineral deposits located on and belonging to the United States on its federal lands "shall be free and open to exploration and purchase" by any citizen of the United States (and individuals who have declared their intention to become such) "under regulations prescribed by law, and according to the local customs or rules of miners in the several mining districts, so far as the same are applicable and not inconsistent with the laws of the United States."66 The Mining Law also allows for the obtaining of a patent67 to the "land claimed and located for valuable deposits," as well as nonmineral land not contiguous to the vein but used by the proprietor for mining or milling purposes.68
The Supreme Court also has addressed the definition of the "discovery" of valuable mineral deposits, which is a requirement for the establishment of a valid mineral location.71 To perfect a mineral discovery and prove its validity, the operator must satisfy one of two tests. The "prudent-man test" has been employed since 1894 and requires proof that "a person of ordinary prudence would be justified in the further expenditure of his labor and means, with a reasonable prospect of success, in developing a valuable mine." The "marketability test" has been utilized more recently (recognized in 1968 by the U.S. Supreme Court) and states that "it must be shown that the mineral can be ‘extracted, removed and marketed at a profit.’"72
A mining operator must perfect its discovery, thus creating a "valid existing right" ("VER"), prior to any purported intervention (such as a withdrawal) in order to defend against such adverse action.73 Only if the BLM prepares a mineral examination report to determine that a mining claim was valid prior to withdrawal and remains valid, will it potentially approve a plan of operations or allow notice-level operations after the date on which the lands are withdrawn from development.74

b. Mining and Minerals Policy Act

In 1970, Congress passed the Mining and Minerals Policy Act ("MMPA"), which reaffirmed the Nation’s encouragement of mining on federal lands, but also added language designed to protect the environment and conserve resources. The MMPA states:

[I]t is the continuing policy of the Federal Government in the national interest to foster and encourage private enterprise in (1) the development of economically sound and stable domestic mining, minerals, metal and mineral reclamation industries, (2) the orderly and economic development of domestic mineral resources, reserves, and reclamation of metals and minerals to help assure satisfaction of industrial, security, and environmental needs, (3) mining, mineral, and metallurgical research, including the use and recycling of scrap to promote the wise and efficient use of our natural and reclaimable mineral resources, and (4) the study and development of methods for the disposal, control, and reclamation of mineral waste products, and the reclamation of mined land, so as to lessen any adverse impact of mineral extraction and processing upon the physical environment that may result from mining or mineral activities.75

c. Federal Land Policy and Management Act

In 1976, Congress adopted the Federal Land Policy and Management Act ("FLPMA"),76 in which it declared the standards for the use of federal lands and attempted to balance the various interests in these lands. In recognition of the numerous uses of public lands, Congress declared that it was its policy that "the public lands be managed in a manner that will protect the quality of scientific, scenic, historical, ecological, environmental, air and atmospheric, water resource, and archeological values," but also that "the public lands be managed in a manner which recognizes the Nation’s need for domestic sources of minerals, food, timber and fiber from the public lands including implementation of the Mining and Minerals Policy Act of 1970...,"77
To balance these often disparate needs, Congress established the management objective of "multiple use,"78 which is defined as:

[T]he management of the public lands and their various resource values so that they are utilized in the combination that will best meet the present and future needs of the American people; making the most judicious use of the land for some or all of these resources or related services over areas large enough to provide sufficient latitude for periodic adjustments in use to conform to changing needs and conditions; the use of some land for less than all of the resources; a combination of balanced and diverse resource uses that takes into account the long-term needs of future generations for renewable and nonrenewable resources, including, but not limited to, recreation, range, timber, minerals, watershed, wildlife and fish, and natural scenic, scientific and historical values; and harmonious and coordinated management of the various resources without permanent impairment of the productivity of the land and the quality of the environment with consideration being given to the relative values of the resources and not necessarily to the combination of uses that will give the greatest economic return or the greatest unit output.79

In other words, ‘"[m]ultiple use management’ is a deceptively simple term that describes the enormously complicated task of striking a balance among the many competing uses to which land can be put... "80

With respect to balancing mining interests and other potential uses of federal lands, the secretary of Interior’s broad discretion to "manage the public lands under principles of multiple use and sustained yield"81 was limited by the fact that FLPMA states that "no provision of this section or any other section of this Act shall in any way amend the Mining Law of 1872 or impair the rights of any locators or claims under that Act... "82 Congress, however, provided an exception to this limitation in stating that the secretary could amend the Mining Law when, "[i]n managing the public lands the Secretary... by, regulation or otherwise, take[s] any action necessary to prevent unnecessary or undue degradation of the lands."83

i. California Desert Conservation Area

Under subchapter VI of FLPMA, Congress established the California Desert Conservation Area, a large area in Southern California covering over 25 million acres. Congress created the CDCA because it found that:

(1) the California desert contains historical, scenic, archeological, environmental, biological, cultural, scientific, educational, recreational, and economic resources that are uniquely adjacent to an area of large population;

(2) the California desert environment is a total ecosystem that is extremely fragile, easily scarred, and slowly healed;

(3) the California desert environment and its resources, including certain rare and endangered species of wildlife, plants, and fishes, and numerous archeological and historic sites, are seriously threatened by air pollution, inadequate Federal management authority, and pressures of increased use...,84

In the designation of the CDCA, Congress directed the secretary to "prepare and implement" a long-range plan for the "management, use, development, and protection of the public lands within the [CDCA]," on or before September 30, 1980.85 This CDCA Plan was to take into account "the principles of multiple use and sustained yield in providing for resource use and development, including, but not limited to, maintenance of environmental quality, rights-of-way, and mineral development."86
Recognizing the numerous conflicts that would arise from the co-existence of the different uses for the lands in the CDCA, the secretary used the principles defined by FLPMA— multiple use, sustained yield, and the maintenance of environmental quality— to craft four "approaches" to resolve these conflicts in the CDCA Plan. The first two address the seeking of simplicity of the Plan to foster management and public understanding and the development of decision-making processes to provide for public review and understanding. The fourth recognizes the interplay between natural and human use patterns. The third directly addresses resource development:

Responding to national priority needs for resource use and development, both today and in the future, including such paramount priorities as energy development and transmission, without compromising the basic desert resources of soils, air, water, and vegetation, or public values such as wildlife, cultural resources, or magnificent desert scenery. This means, in the face of unknowns, erring on the side of conservation in order not to risk today what we cannot replace tomorrow.87

The CDCA Plan divides the CDCA into four multiple-use classes: (1) Class C, the most restrictive class, is limited to lands with potential suitability for congressional wilderness designation; (2) Class L (Limited Use); (3) Class M (Moderate Use); and (4) Class I (Intensive Use).88 Claimant’s mining claims are located on Class L land.89 The CDCA Plan defines Multiple-Use Class L lands as "protect[ing] sensitive, natural, scenic, ecological, and cultural resource values. Public lands designated as Class L are managed to provide for generally lower-intensity, carefully controlled multiple use of resources, while ensuring that sensitive values are not significantly diminished."90 The CDCA Plan acknowledges the special difficulty in resolving conflicts between the numerous options for Class L lands (as opposed to other more or less restrictive classes), explaining that "judgment is called for in allowing consumptive uses only up to the point that sensitive natural and cultural values might be degraded."91
In the designation of the CDCA, Congress again indicated its continued respect for mining claims but also attempted to balance these interests with the other potential uses for the land and the need to protect federal resources. It stated that "[s]ubject to valid existing rights, nothing in this Act shall affect the applicability of the United States mining laws on the public lands within the California Desert Conservation Area."92 Even these laws, however, Congress made subject to "[s]uch regulations... as may be reasonable to protect the scenic, scientific, and environmental values of the public lands of the [CDCA] against undue impairment, and to assure against pollution of the streams and waters within the [CDCA]."93
In general, the CDCA Plan recognizes one of its goals under its geology, energy and mineral (G-E-M) resources element as continuing "to recognize access to and availability of as much public land as possible for mineral exploration and development."94 With respect to Class L lands specifically, the CDCA Plan states that the location of mining claims on Class L lands is nondiscretionary, though operations are subject to the BLM-promulgated Surface Management of Public Lands Under U.S. Mining Laws, 45 Fed. Reg. 78,902-78,915 (Nov. 26 1980) ("3809 Regulations") (including the above-stated standard of "undue impairment") and applicable state and local law.95 BLM approval of mineral operations is nondiscretionary in that, if a corporation satisfies all the appropriate regulations, the BLM must recognize the corporation’s ability to explore, develop, and extract minerals from federal lands governed by the Mining Law of 1872.96 In the absence of the receipt of a jeopardy opinion from the U.S. Fish and Wildlife Service on a federally listed species, the CDCA Plan states that "no mining operation under these regulations may be denied unless a proven case of noncompliance with these regulations is demonstrated."97
The CDCA Plan provides that cultural resources are to "be given the same consideration as other resource values" when included in activity plans,98 but the creation of an accurate and complete inventory of these resources has proven difficult. Only approximately 5% of the CDCA had been inventoried for cultural resources at the Plan’s creation99 and only approximately 10% today;100 the secretary has thus requested continuing efforts "to identify the full array of the CDCA’s cultural resources."101 At least five elders of the Quechan Tribe were interviewed in the late 1970s during the CDCA planning process at the BLM’s request to "aid the cultural resource program by identifying sacred areas of concern to the Quechan within the California Desert."102 [REDACTED]103 [REDACTED]. The drafted a composite map, titled "Native American Areas of Concern," which depicts areas of concentrated sacred sites, listing "very high" and "high" areas of tribal concern, and designating the vast remainder of the CDCA as "moderate" areas of concern.104 As this map, and other confidential planning maps produced, focused on concentrations of sacred sites and were thus meant to be "predictive models of important cultural resources," the desert planning staff did not regard them to be comprehensive.105

ii. Areas of Critical Environmental Concern

In an additional attempt to preserve areas of unusual plant or animal diversity, unique geologic features, or rare concentrations of the remains of historic or prehistoric use, the CDCA Plan established Areas of Critical Environmental Concern.106 An ACEC is defined as an area "within the public lands where special management attention is required (when such areas are developed or used or where no development is required) to protect and prevent irreparable damage to important historic, cultural, or scenic values, fish and wildlife resources, or other natural systems..."107 Although the primary management focus for ACECs is the protection of important cultural and natural resources, "every effort" is made to accomplish this protection while not unreasonably or unnecessarily restricting other uses of these lands that are compatible with that protection.108

d. The 3809 Regulations

In 1980, under the statutory authority given to it by FLPMA and in furtherance of FLPMA’s goals, the BLM promulgated the "3809 Regulations."111 The stated purposes of the 3809 Regulations are to "[p]revent unnecessary or undue degradation of public lands by operations authorized by the mining laws... and establish[] procedures and standards to ensure that operators and mining claimants meet this responsibility."112 Additionally, the regulations sought to "[p]rovide for maximum possible coordination" with state agencies to prevent duplication and ensure operators were held to the above standard.113
In accordance with the MMPA and FLPMA, the 3809 Regulations acknowledged that "[u]nder the mining laws a person has a statutory right... to go upon the open... federal lands for the purpose of mineral prospecting, exploration, development, extraction and other uses reasonably incident thereto."114 As required by FLPMA, however, "[t]his statutory right carries with it the responsibility to assure that operations include adequate and responsible measures to prevent unnecessary or undue degradation of the federal lands and to provide for reasonable reclamation."115
The 3809 Regulations provide the basic regulatory framework for the submission and review of mining plans of operation to ensure that unnecessary or undue degradation is avoided and reclamation is required. For a "plan-level operation" like that of the Imperial Project, in which more than five acres is disturbed or there is work in wilderness or areas of critical environmental concern (including CDCA Class C and L lands), a plan of operations must be submitted and BLM’s approval acquired prior to the commencement of mining activities.116 This plan of operations must describe the type of operations and how they will be conducted, as well as measures to be taken to prevent unnecessary and undue degradation and measures to reclaim disturbed areas.117
Following the filing of a plan of operations, an authorized official must make an environmental assessment to "identify the impacts of the proposed operations on the lands and to determine whether an environmental impact statement [under the National Environmental Policy Act of 1970 (‘NEPA’)] is required."118 The authorized official will then work with the operator to assess the environmental impact and the adequacy of mitigating measures and reclamation procedures to "insure the prevention of unnecessary or undue degradation of the land."119 If the operator is unable to prepare mitigating measures, the official will work with the operator to use the environmental assessment as a basis for assisting the operator in developing such measures.120
In defining "unnecessary and undue degradation" for use in these regulations, BLM adopted a "prudent operator" standard:

‘Unnecessary or undue degradation’ means surface disturbance greater than what would normally result when an activity is being accomplished by a prudent operator in usual, customary, and proficient operations of similar character and taking into consideration the effects of operations on other resources and land uses, including those resources and uses outside the area of operations. Failure to initiate and complete reasonable mitigation measures, including reclamation of disturbed areas or creation of a nuisance may constitute unnecessary or undue degradation. Failure to comply with applicable environmental protection statutes and regulations thereunder will constitute unnecessary or undue degradation. Where specific statutory authority requires the attainment of a stated level of protection or reclamation, such as in the California Desert Conservation Area..., that level of protection shall be met.121

The level of reclamation necessary, in both the plans and operations, is that which "will prevent unnecessary or undue degradation of the federal lands."122 These include "reasonable measures," such as reshaping disturbed land to "an appropriate contour," and revegetating, where necessary, "to provide a diverse vegetative cover."123 Reclamation is not required, however, where the retention of a stable highwall or other mine workings is necessary to preserve evidence of mineralization.124
In addition to preventing unnecessary or undue degradation and requiring reclamation, all operations also must "comply with all pertinent Federal and State laws."125 These laws include, but are not limited to, those relating to air and water quality, solid wastes, fisheries, wildlife and plant habitat, and cultural and paleontological resources.126 If the 3809 Regulations conflict with state laws or regulations, the operator is to follow the 3809 Regulations, except if the state laws or regulations "require[] a higher standard of protection for public lands" than the 3809 Regulations.127

i. 3809 Regulations — 2001 Revisions

On November 21, 2000, the Department of the Interior ("DOI") promulgated revisions to the 3809 Regulations that became effective on January 20, 2001, enforceable as to all new plans of operations submitted after that date.128 The significant change in these revisions with respect to this Arbitration is that they added a further definition of "unnecessary or undue degradation": "[a]voiding substantial irreparable harm to significant scientific, cultural, or environmental resource values of the public lands that cannot be effectively mitigated,"129 known as the "SUT Standard." Therefore, as the BLM could deny, or withhold, approval of a mining plan of operations that would result in unnecessary or undue degradation of federal lands, that criterion could now be met by, among other violations, failing to avoid "substantial irreparable harm."130
The revisions contain one further item that pertains to this Arbitration. They recognize that the past two congressional appropriations acts contained a requirement that any final 3809 Regulations must be "not inconsistent with" the recommendations in the National Academy of Science/National Research Council ("NAS/NRC") Report on Hardrock Mining on Federal Lands ("NRC Report").132 Under a section titled, "Consistency With the NRC Report," the regulations note that the use of mandatory pit backfilling would be "inconsistent with the NRC recommendation that BLM use performance-based standards."133

e. National Environmental Policy Act

The National Environmental Policy Act, which took effect in 1970, requires the preparation of an Environmental Impact Statement ("EIS") whenever a federal action has the potential to "significantly affect[] the quality of the human environment..."134 This statute applies, in practice, any time a federal agency grants a permit, agrees to fund, or otherwise authorizes any entity to undertake an action that has the potential to affect environmental resources. The EIS must contain a detailed statement by the responsible official on: (1) the environmental impact of the proposed action; (2) any adverse environmental effects which cannot be avoided should the proposal be implemented; (3) alternatives to the proposed action; (4) the relationship between local short-term uses of man’s environment and the maintenance and enhancement of long-term productivity; and (5) any "irreversible and irretrievable commitments of resources" that would be involved.135
To complete an EIS, the purpose and need for the proposed action must be determined, "reasonable alternatives"136 identified, and the environmental impacts of the proposed action and each alternative analyzed.137 After this analysis, the BLM selects its "preferred alternative," based on both the environmental analysis and consideration "of other factors which influence the decision or are required under another statutory authority."138 This "preferred alternative" is that alternative which will "fulfill [the agency’s] statutory mission and responsibilities, while giving consideration to economic, environmental, technical, and other factors."139

f. FLPMA and the California Desert Protection Act

FLPMA requires the review of roadless public lands of 5,000 or more acres that were identified during the inventory under 43 U.S.C. § 1711(a) as having wilderness characteristics as described in the Wilderness Act of September 3, 1964.140 In addition, FLPMA requires periodic reporting to the president of the United States as to the suitability or nonsuitability of these areas for preservation as wilderness.141
In response to this mandate, BLM proposed a three-step Wilderness Policy and Review Procedure, involving: (1) inventory of all public areas meeting the above characteristics; (2) study of each of these areas to determine suitability or nonsuitability for possible designation as wilderness; and (3) reporting to Congress.142 As a result of this study, two areas north of the Imperial Project were identified for possible recommendation to Congress for permanent wilderness designation.143 Following further study, these areas, along with 43 others, were included in the 1980 CDCA Plan for preliminary recommendation to the federal government for permanent protection.144
This study resulted in the passage of the California Desert Protection Act ("CDPA") in October 1994.145 The act designated 69 wilderness areas which, subject to valid existing mining rights, would be protected as components of the National Wilderness Preservation System.146 Indian Pass and Picacho Peak were included in the designated wilderness areas.147
With the designation of the protected areas, Congress made clear that although the land within the wilderness area would be protected, areas immediately adjacent to such wilderness would not be withdrawn from development.148 The CDPA includes a provision that establishes "no buffer zones."149 In other words, the Act did not create protective perimeters around any wilderness area, so that non-wilderness activity can be seen and heard from protected areas and such activities would not be precluded up to the boundary with the wilderness area,150 though they still would be subject to any other regulation, if any, "flowing... from the application of other law."151

2. California Mining and Related Law

a. California Environmental Quality Act

Similarly to NEPA, the California Environmental Quality Act ("CEQA") requires the completion of an Environmental Impact Report ("EIR") with respect to "discretionary projects proposed to be carried out or approved by public agencies"152 whenever "the public agency finds substantial evidence that the project may have a significant effect on the environment."153
Like NEPA, CEQA requires the responsible agency to consider feasible alternatives or mitigation measures to lessen significant environmental impacts.154 The policy of the State, as declared by the legislature, is that "public agencies should not approve projects as proposed if there are feasible alternatives or feasible mitigation measures available which would substantially lessen the significant environmental effect of such projects."155 It added, however, that "in the event specific economic, social, or other conditions make infeasible such project alternatives or such mitigation measures, individual projects may be approved in spite of one or more significant effects thereof."156
With respect to the Imperial Project, as in most cases, the CEQA review proceeded in conjunction with the federal NEPA review, to avoid duplication of efforts. Pursuant to a state-federal Memorandum of Understanding, the federal and local agencies prepared a joint EIS/EIR, defining and analyzing the environmental impacts of the Project.157

b. California Surface Mining and Reclamation Act

The California Legislature passed the Surface Mining and Reclamation Act of 1975 ("SMARA")158 with the finding and declaration that "the extraction of minerals is essential to the continued economic well-being of the state and to the needs of the society, and that the reclamation of mined lands is necessary to prevent or minimize adverse effects on the environment and to protect the public health and safety."159
With the enactment of SMARA, California, like the federal government before it, attempted to encourage mining activities while putting in place regulations to protect the environment and other resources from the possible ill effects of these activities. The stated intent of the legislature in enacting SMARA describes this goal:

It is the intent of the Legislature to create and maintain an effective and comprehensive surface mining and reclamation policy with regulation of surface mining operations so as to assure that:

(a) Adverse environmental impacts are prevented or minimized and mined lands are reclaimed to a usable condition which is readily adaptable for alternative land uses.

(b) The production and conservation of minerals are encouraged, while giving consideration to values relating to recreation, watershed, wildlife, range and forage, and aesthetic enjoyment.

(c) Residual hazards to the public health and safety are eliminated.160

Under SMARA, a permit is required from the "lead agency"161 in order to conduct surface mining operations.162 In order to receive such a permit, a prospective operator must submit a reclamation plan and financial assurances for reclamation.163 Reclamation is thus an important aspect of SMARA and integral to this Arbitration. It is defined in SMARA as:

[T]he combined process of land treatment that minimizes water degradation, air pollution, damage to aquatic or wildlife habitat, flooding, erosion, and other adverse effects from surface mining operations, including adverse surface effects incidental to underground mines, so that mined lands are reclaimed to a usable condition which is readily adaptable for alternate land uses and create no danger to public health or safety. The process may extend to affected lands surrounding mined lands, and may require backfilling, grading, resoiling, revegetation, soil compaction, stabilization, or other measures.164

The lead agency researches and produces an EIR when reviewing surface mining permits for open-pit mining operations which utilize a cyanide heap-leaching process, like the Imperial Project.165 After analyzing this EIR, the lead agency then decides whether or not and how to approve the project.166 Although the reclamation requirements are then implemented at the county level, certain policies for surface mining operations, including guidelines describing the exact types of reclamation required, are handed down by the State Mining and Geology Board ("SMGB") which, at the direction of SMARA, adopts State measures to be utilized by the lead agencies.167

3. Historic and Cultural Preservation Law

a. The National Historic Preservation Act

In 1966, Congress enacted the National Historic Preservation Act ("NHPA"), declaring that "the spirit and direction of the Nation are founded upon and reflected in its historic heritage," and that it is "necessary and appropriate for the Federal Government to accelerate its historic preservation programs and activities."168 To achieve this goal, the NHPA authorized the secretary of the Interior "to expand and maintain a National Register of Historic Places," ("National Register").169 In addition, it established the Advisory Council on Historic Preservation ("ACHP"), an independent federal 20-member agency tasked with the advisement of the president and Congress on historic preservation policy and the promotion of historic preservation through the encouragement of public awareness, study, training, policy review and legislative assistance.170
Pursuant to Section 106 of the NHPA, federal agencies must consider, prior to the authorization of any federal fund expenditure or license issuance, the effects of such undertaking on historic properties included in or eligible for inclusion in the National Register.171 In addition, the agency must afford the ACHP a reasonable opportunity to comment on such activities172 and "consult with any Indian tribe or Native Hawaiian organization that attaches religious and cultural significance" to the historic property.173
To ensure compliance with Section 106, the ACHP promulgated regulations, which outline a series of procedures known as the Section 106 Process.174 First, upon the determination that a federal undertaking has the potential to affect a historic property, the agency must invite to be consulting parties the appropriate State and/or Tribal Historic Preservation Officer ("SHPO" or "THPO") and any Native American tribe that might "attach religious and cultural significance to historic properties in the area of potential effects" of an undertaking.175 Second, the agency, in conjunction with the appropriate entities, must determine the "Area of Potential Effect" ("APE"), identify any historic properties in the APE, and determine whether such properties are eligible for listing in the National Register.176 Third, again in consultation with the appropriate entities, the agency must determine whether the historic property would be adversely affected in that the undertaking would alter any of the property’s historic characteristics.177 Fourth, if an adverse effect is determined, the agency must notify the ACHP and consult with the SHPO and other consulting parties, including Native American tribes, "to seek ways to avoid, minimize or mitigate the adverse effects" on the historic properties; then, if the agency and SHPO agree upon how to address the effects, a memorandum of agreement will be executed.178 Finally, if the agency official, the SHPO/THPO or the ACHP determines that further discussions will not result in an agreement that will resolve the adverse effects, it may terminate the consultation and request the ACHP to comment to the head of the agency who shall then consider such comments and respond to them prior to any final decision on the undertaking.179

b. Federal Legislation to Protect Native American Culture

In 1979, the Archaeological Protection Act ("ARPA") was passed by Congress to ensure that "any material remains of past human life or activities which are of archaeological interest" to the Nation are protected for "the present and future benefit of the American people."180 ARPA establishes a permitting process for the excavation or removal of any archaeological resource on public or Native American land and imposes criminal and civil penalties for the unauthorized excavation and removal of such culturally significant objects.181
Eleven years later, in 1990, Congress enacted the Native American Graves Protection and Repatriation Act ("NAGPRA") to protect Native American cultural items discovered on federal or tribal lands.182 This law established a process for the repatriation from all federal agencies and museums of Native American (and Native Hawaiian) human remains, funerary objects, sacred objects, and "cultural patrimony."183
Finally, in 1996, President Clinton issued Executive Order No. 13007, directing each executive branch agency with statutory or administrative responsibility for the management of federal lands to "accommodate access to and ceremonial use of Indian sacred sites by Indian religious practitioners" and to "avoid adversely affecting the physical integrity of such sacred sites" when making land use decisions.184 Where practicable, the agencies also were directed to maintain the confidentiality of such sites.185

c. California Legislation to Protect Native American Culture

In 1976, the California legislature enacted the Native American Historical, Cultural and Sacred Sites Act ("Sacred Sites Act").186 This legislation prohibits both state agencies and private parties operating on public property under a public grant to use or occupy such land in a manner that would "cause severe or irreparable damage to any Native American sanctified cemetery, place of worship, religious or ceremonial site, or sacred shrine," except on clear and convincing evidence demonstrating that such destruction is necessary for the public interest.187 The Sacred Sites Act also created the Native American Heritage Commission ("NAHC") and empowered it to, among other tasks, preserve sacred sites on both public and private lands, and bring actions "to prevent severe and irreparable damage to, or assure appropriate access for Native Americans to," any of the above-mentioned sacred places.188

d. International Instruments Protecting Historic and Cultural Properties

The United Nations Educational, Scientific and Cultural Organization ("UNESCO") has adopted several conventions and declarations regarding the protection and preservation of cultural property, since the 1960s. Its 1968 Recommendation concerning the Preservation of Cultural Property Endangered by Public or Private Works, for instance, recommends member States to take whatever legislative or other steps are necessary, as well as bringing the recommendation to the attention of authorities responsible for public and private works and conservation, in order to preserve, salvage, or rescue cultural property.189 Any measures for preservation or salvage enacted are to be both preventive and corrective, per the recommendation.190 The recommendation additionally instructs that, "[a]t the preliminary survey stage of any project involving construction in a locality recognized as being of cultural interest... several variants of the project should be prepared" and considered.191
The World Heritage Convention, adopted by UNESCO in 1972, ratified by the United States and incorporated into the NHPA, recognized that the destruction of any cultural site impoverishes "the heritage of all the nations of the world."192 Member States to the convention commit "to adopt a general policy which aims to give the cultural and natural heritage a function in the life of the community and to integrate the protection of that heritage into comprehensive planning programmes," and also to enact "appropriate legal, scientific, technical, administrative and financial measures necessary for the identification, protection, conservation, presentation and rehabilitation of this heritage."193 The convention additionally calls for the establishment of a World Heritage Committee to maintain an international register of sites of cultural heritage.194

C. Establishment and Review of the Imperial Project

1. Initial Exploration and Development of Mining Claims and Mill Sites

Claimant acquired its initial mining claims in the Imperial Project from the Gold Fields Mining Corporation ("Gold Fields Mining") in 1987. Gold Fields Mining had been exploring the area since 1980.195 In 1987, Gold Fields Mining joined with Glamis Imperial (then Glamis Gold Exploration, Inc.), a wholly owned subsidiary of Glamis Gold, Inc., to form a joint venture, the Imperial County Joint Venture.196 Shortly thereafter, in 1988, Claimant, through the Imperial County Joint Venture, began mineral exploration activities in the area.197
The gold in this area is greatly disbursed among the waste rock; Claimant thus projects that it would need to excavate 150 million tons of ore and 300 million tons of waste rock198 to yield an estimated 1.17 million ounces of gold and possibly another 0.5 million ounces through continued exploration.199 In such circumstances, the drilling of core samples throughout the target region is used to survey the field. Therefore, the exploration program of the Imperial County Joint Venture included the submission and approval of several exploration drilling plans of operation, including one BLM-approved plan for small-scale drilling along Indian Pass Road in November 1988.200
In the summer of 1991, Claimant undertook a more extensive drilling program based upon the favorable results of its early exploration activities.201 Claimant submitted a drilling plan of operation for this program and received letters of approval from BLM in July and September 1991.202 BLM also prepared an environmental assessment of the drilling program which returned a "Finding of No Significant Impact" so that a full EIS was not warranted under the NEPA.203 This finding determined that the proposed action, with the described mitigation measures, would "not have any significant impacts on the human environment."204
Between 1987 and 1993, Claimant states that it spent nearly $2 million on the Imperial Project, with most of these costs incurred on the acquisition of the mining claims and the early exploration drilling program.205

2. Initial Cultural and Archeological Surveys and Inventories of the Region

At the outset of this section, the Tribunal notes that there is much disagreement between the Parties as to the appropriate methodologies and reasonable conclusions of the various cultural studies and inventories of the region. In addition, they dispute each other’s interpretations of the conclusions of these surveys. For instance, in its description of the studies and their findings, Respondent touts the tranquility and pristine quality of the Imperial Project site as well as the uniqueness of the cultural findings in the area; while Claimant argues that the site has been marred by military, rockhound and recreational activity and lacks unique cultural findings when compared to other areas and mine sites.206 With this in mind, the Tribunal has attempted to describe only the cultural studies and inventories and their findings, without delving into the Parties’ disparate interpretations of the significance of these conclusions and their criticisms of the methodologies.
Archaeologist Malcolm Rogers conducted the earliest surveys of the Indian Pass Area in 1925, 1939, 1941 and 1942.207 He surveyed the area to the south of the Imperial Project at what is now the site of the Running Man geoglyph and identified the two major prehistoric Native American trails of the region and a spirit break, but not the geoglyph itself.208 In the vicinity of these trails, he located trail markers and shrines, pot drops, and shattered quartz.209
When Gold Fields Mining Corporation and AMIR Mines Ltd. ("AMIR Mines"), Glamis’ predecessors in interest, first proposed exploratory mining in the area to the BLM, they funded several archaeological surveys to determine if any historic properties could be harmed by the undertaking, consistent with Section 106 of the NHPA. The first cultural resource inventory on the "Indian Rose prospect"—a 200-acre property that would become part of the Imperial Project area—was also funded by Gold Fields Mining in 1982.210 WESTEC Services, Inc. ("WESTEC") conducted the inventory and found "[c]ryptocrystalline lithic resources... in abundance throughout the project property" and "7 previously unrecorded archaeological locales."211 [REDACTED] WESTEC recommanded mitigation measures to avoid adversely affecting these sites.212
In compliance with federal laws concerning cultural resources on public lands, AMIR Mines contracted again with WESTEC to survey 15 additional drill sites in 1987, in an area that would become part of the Imperial Project.213 When this survey resulted in the discovery of 10 sites and six isolates,214 AMIR Mines modified its development plan to avoid these sites.215 WESTEC completed a third inventory for AMIR Mines in 1988, in which it recorded eight sites, 16 isolates, and one site update, and [REDACTED]216 Because of the potential eligibility of the site for inclusion in the National Register of Historic Places ("NRHP"), [REDACTED].217
In the fall of 1983 and spring of 1987, the Imperial Valley College Desert Museum ("IVCDM") also conducted two independent surveys of what it called the Gold Fields Indian Pass Project Area, a 3,168-acre area.218 The 1983 survey discovered 25 sites and 84 isolated archaeological occurrences that were not large enough for recognition as viable sites.219 The 1987 survey identified approximately 30 archaeological sites, mostly "trails and lithic stations... typical of the Indian Pass Project Area."220 [REDACTED]221 The researchers in both studies noted, however, that the artifacts found were unlikely to be culturally centered in the Project area, but instead pointed elsewhere for meaning. "In other words, the importance of the Indian Pass Project Area is archaeologically related to other areas and the Native group they served. The Project Area itself was minor in use and purpose, serving as one of the outreach areas...,"222 The 1987 surveyors did, however, also discover another pre-ceramic trail and, based on these and previous discoveries, concluded that the area was located on "a major north-south trail system that connected with the Colorado River, the Indian Pass site, and the Mojave Trail..."223
In addition to and as part of its expanded drilling and exploration program, Imperial Gold, another predecessor in interest to Claimant, conducted its own cultural resource investigation of the area in June 1991.224 Quechan Nation Tribal Historian, Lorey Cachora, participated as a member of the survey team in the investigation.225 The investigation found that "no sites eligible for the National Register of Historic Places were previously recorded in the study area. Cultural resources [found] consist of lithic procurement sites... [s]everal trails, pot drops, and one historic rock structure complex."226 This finding was based in part on the earlier cultural resource studies from 1982, 1983, 1987 and 198 8.227 The survey did identify the trail complex recorded by the 1987 IVCDM and 1988 WESTEC inventories and noted a large number of lithic and ceramic scatters that the archaeologists believed were associated with a tributary trail.228 [REDACTED]229

3. Submission and Review of the Plan of Operations

On December 6, 1994, Claimant submitted its Imperial Project Plan of Operations and Reclamation Plan to the Imperial County Planning and Building Department of the State of California ("ICPBD") (the appropriate lead agency).230 The operations and reclamation plans followed and fulfilled the requirements established by the 3809 Regulations.231
As is customary, BLM coordinated with the ICPBD in the review of Claimant’s Plan of Operations ("POO") and the completion of a joint EIS/EIR.232 Claimant met with these officials on December 6, 1994, to discuss the POO. At this meeting, Claimant was informed that the greatest expected Project opposition would be received from the wildlife and hunting sectors, though "BLM [was] also considering requiring compensation for the irreparable damage left by un-backfilled pits."233

4. Continuing Site Exploration

Throughout the review of these and subsequent submissions, Claimant continued its exploration drilling program. Between March 5, 1993 and August 2, 1996, Claimant received eight exploration and drilling program approval decisions from BLM which resulted in the drilling of approximately 400 mineral exploration holes in the Imperial Project vicinity by Claimant and its predecessors.234 As part of this continued exploration, Claimant completed its first Internal Feasibility Study on April 6, 1995, which concluded that the Imperial Project would return positive economic returns and further investigation and expenditures were warranted to complete a final feasibility report.235 A Final Feasibility Study was completed in April 1996, confirming the Project’s economic viability.236
According to Claimant, this exploration, as well as environmental permitting, required capital expenditures from Claimant of over $3 million in 1995, as well as further funds for cultural resources studies as detailed below.237 In 1996, Claimant invested an additional $2.78 million for environmental permitting, studies and equipment.238 One million dollars were spent in 1997 on environmental permitting, and Claimant invested an additional $7.55 million in a mining shovel acquired in 1996, which also required $15,480 per month in storage costs.239 The total of all expenditures amounted to an investment of more than $18.6 million in the Imperial Project through 1997.240

5. Initial Environmental Impact Study

Following Claimant’s submission of its Plan of Operations on March 24, 1995, BLM published notice of its intent to prepare an environmental impact study for the Imperial Project in the Federal Register, as required by statute.241 BLM issued the first draft environmental impact study/draft environmental impact report ("DEIS/DEIR") in November 1996, after 16 months of study.242 This study chose the proposed Project as the preferred alternative with some additional mitigation and environmental conditions,243 though it stated that construction of project facilities could destroy the identified, and possibly still undiscovered, potentially significant cultural and paleontological resources.244
In 1995, as part of this first DEIS/DEIR for the Project, Chemgold, Inc. (Claimant’s predecessor) retained ASM Affiliates, Inc. ("ASM") to survey and inventory the proposed Imperial Project area for cultural and archeological resources.245 ASM identified 49 sites in this and its subsequent 1996 survey—[REDACTED].246 Based on investigation, ASM stated that there "can be no doubt that the area in and around the Imperial Mine Project was heavily utilized by pre-contact Native Americans as a travel route and as a source for tool-grade lithics."247 ASM thus concluded, based on preliminary evaluation, that the trail segments were significant and eligible for the NRHP.248 [REDACTED].249
In response to initial BLM comments on the draft report from the 1995 survey, an additional extended Phase II survey was conducted by ASM in February 1996.250 As mentioned, ASM recorded 49 sites and [REDACTED].251 It also identified the "Running Man" geoglyph, though it concluded that it was likely a "very recent historic addition."252 ASM stated that "the trails and associated features in the project area are part of one of the most important east-west and north-south prehistoric transportation networks in the region."253
The issuance of the 1996 DEIS/DEIR was followed by a comment period, also required by statute.254 Two public hearings were held in El Centro and La Mesa, California, at which 49 people spoke, and 425 comment letters were received.255 The comments raised issues concerning the effect on the Quechan and other Native American tribes, visual resources, wildlife and wildlife habitats, groundwater, and other issues.256 In addition, it prompted a request from the Quechan Tribe Cultural Committee that BLM address issues related to ground water and air quality, and conduct a more extensive resurvey of the area not as a "single event," but in the context of its relationship with other artifact groupings in the area.257 These concerns prompted BLM to request a new "Class III (intensive) cultural resource inventory of the entire project area... to verify that all cultural resources within the [Area of Potential Effect were] properly identified and evaluated."258 BLM also withdrew the 1996 DEIS/DEIR on August 1, 1997, and decided to issue a new DEIS using the comments made thus far as "scoping comments."259

6. Cultural Studies Following the 1996 DEIS/DEIR

In preparation for the completion of the revised EIS/EIR, and as a first step in agreeing to the Quechan’s request for additional surveys of the Imperial Project area, BLM hired Dr. Michael Baksh, an ethnographer, to consult with the Quechan Tribe to help learn about and evaluate site significance and initiate discussions regarding mitigation measures.260 The Tribe informed Dr. Baksh that the Project vicinity was a component of a larger region important to the Quechan Tribe,261 and that the whole area along the Colorado River was sacred.262 Dr. Baksh noted that "specific explanations relating to the extreme cultural significance of many cultural resources in the area were often hard to come by."263 Attempts to discuss mitigation with the Quechan Cultural Committee failed, as the Tribe viewed complete avoidance of development in the region as the only acceptable alternative.264 According to Dr. Baksh, however, Mr. Cachora and Mr. Antone believed that mitigation including the designation of [REDACTED] as traditional cultural sites, the creation of a video documentary, improvements to the Quechan Museum, acquisition and protection of sensitive sites, and additional studies could help, as part of an overall package, to offset significant impacts to cultural resources should the Project proceed.265
In addition to the interviews, KEA Environmental, Inc. ("KEA") was retained to conduct the required Class III pedestrian resurvey and cultural resources inventory.266 KEA expanded the area of potential effect ("APE") beyond the Project boundaries, per instructions from the BLM, to identify any cultural resources within the buffer zones and also to allow for possible plan reconfiguration to avoid archaeological sites.267 BLM instructed KEA to determine the existence, if any, of one or more "traditional cultural properties" ("TCPs") in the Project vicinity.268 Due to the vast area of concern articulated by the Quechan and the difficulty of confining it into one or more TCPs, however, BLM later instructed KEA to leave the boundaries of the TCPs open and instead evaluate the total "area of traditional cultural concern" ("ATCC").269 [REDACTED]270271272
The Trail of Dreams allegedly runs [REDACTED]273 The trail’s importance comes from its membership in a complex trail network known as Xam Kwatcan, which also encompasses the Medicine Trail, the Mojave Salt Song Trail and the Keruk Trail.274 The Quechan believe that Kumastamxo, the God-son of their creator, Kukumat,275 led them down this sacred trail upon Kukumat’s death as a completion of the creation cycle because the creator had told the people that, upon his death, he would "return to where he came from."276Xam Kwatcan means literally "another going down" and the Quechan believe that it was laid down for them by their creator to connect Avi Kwame Mountain (a sacred mountain where, according to Pan-Yuman myth, Kukumat created the Yuman tribes and still resides in spirit form)277 with their tribal lands along the river.278 This journey was reenacted by the Quechan people at irregular intervals, sometimes several times a year and at other times only once every few years, in the form of the Keruk creation ceremony to celebrate the creation of the world, the spirit world, the natural world, and Kukumat’s cremation. It was also a memorial service for those recently departed.279 The ceremony lasted four days and also was an occasion for families, friends and even other tribes to come together to establish and maintain personal and economic relationships, conduct courtship and arrange marriages, and settle disputes.280 It was performed by the Quechan until approximately 1947 or 1948.281
Despite the cultural importance of Xam Kwatcan and the Trail of Dreams, determination of the Trail of Dreams’ eligibility for the NRHP was delayed by confusion as to the precise location of the Trail.282 Claimant asserts that much of the early literature failed to mention Xam Kwatcan or even mention a physical trail in connection with the Creation myth,283 thus determining the trail’s locations proved difficult. Claimant points to a 1986 study of the Pilot Knob ACEC by Clyde M. Woods, for instance, that places Xam Kwatcan outside of the Imperial Project APE,284 while a 2001 study describes only a non-physical "Dream Trail" above the actual physical Xam Kwatcan285 Claimant asserts that even the 1997 KEA study exhibited confusion about the exact location of the Trail of Dreams (which Dr. Cleland attributed to editing errors),286 [REDACTED]287288289 Much of the later confusion stemmed from the allegedly the trails: [REDACTED]290 [REDACTED]291 [REDACTED]292 [REDACTED]293 [REDACTED]294 [REDACTED]295
As the heart of the Quechan’s opposition to the Imperial Project rested on their belief that it would destroy the Trail of Dreams, Claimant funded a trails reconnaissance survey in 1998.296 [REDACTED]297 [REDACTED]298 [REDACTED]299 Thus, it opined that all the prehistoric trail sites in the Project area, including those associated with the Trail of Dreams, were eligible for registration with the NRHP.300
In the "ancillary area" to the Project, KEA also noted the Running Man site whose significance, the survey noted, [REDACTED]301 Based on these findings, the "high frequency of cultural features of religious or symbolic significance" within the vicinity of the Project mine and process area, and the Quechan’s expressions of "strong cultural concerns for the vicinity of the Project," KEA concluded that a cultural resource district had been defined that "encompass[ed] the Project mine and process area but also extend[ed] as far north as Indian Pass and south into the Project ancillary area."302 KEA also stated its opinion that this Indian Pass-Running Man ATCC was eligible for National Register consideration as a district.303

7. 1997 Draft Environmental Impact Study/Environmental ImpactReport

The revised DEIS/DEIR was released in November 1997, shortly after the first draft of KEA’s Where the Trails Cross report.304 In response to the questions raised concerning the 1996 DEIS/DEIR, Claimant made substantial revisions to its Plan of Operations and mitigation plan to better protect the religious and cultural sites identified.305
The 1997 DEIS/DEIR, as detailed above, found that the Imperial Project (including an alternative that required complete backfilling of all open pits) would have "significant unavoidable" impact (after mitigation) on the "ability of the Quechan to travel physically and spiritually along the Trail of Dreams..., conduct traditional religious activities..., [and] use the Indian Pass-Running Man ATCC for traditional cultural education programs."306 The 1997 DEIS/DEIR stated, however, that with the addition of the mitigation measures, "the Proposed Action [was] the BLM’s Preferred Alternative."307 The comment period following the 1997 DEIS/DEIR was extended to 135 days, during which BLM received 541 written and oral comments.308

8. Government to Government Consultations with the Quechan

On December 16, 1997, representatives of the Quechan Indian Tribe met with the BLM in government to government discussions regarding the Imperial Project.309 At this meeting, Mr. Cachora, Quechan Tribal Historian, described the importance of the area to the Quechan people’s cultural resources and religious values;310 he likened the religious significance of the area to "Jerusalem or Mecca."311 Mr. Cachora argued that the First Amendment protected the Quechan’s freedom to exercise their religion and thus required protection of this holy site.312 Mr. Cachora explained that, although the Tribe had allowed other mining operations to "go by" in the area because they "understood people needed jobs," this was done "partly because [they] knew [they] had an area in reserve... owned by the public... but little did [they] know [BLM] had another operation in mind."313 Thus the Imperial Project area became the Tribe’s "last stand."314
BLM State Director Hastey reassured the Tribe that he and the solicitor’s office had already begun addressing the issue of how religious issues would be treated under the Mining Law.315 He explained that, in the event of a conflict between religious concerns and mining rights on federal lands, the Mining Law tended to take precedence.316 Director Hastey also explained the issue of an operation’s validity to the Tribe, stating that "the only criterion for BLM is whether the proposed project is a valid operation."317 He added that, although BLM was performing preliminary validity reviews of the Imperial Project and further intensive examination might be required, it was "‘kind of hamstrung’ when it comes to 1872 mining law rights,..."318 Director Hastey added, however, that this is "an unusual area," as most desert mining was found in "old mining districts" and that this area is "fairly unique" in that it has had no previous mining.319
Senator Boxer’s representative questioned Mr. Hastey about backfilling with respect to the Imperial Project to which Mr. Hastey replied that the BLM indeed had required backfilling at other projects and would evaluate it with respect to this Project, but that BLM must justify it in economic terms and that "mitigation has to be ‘reasonable under prevailing standards.’"320
Following the December government to government meeting, Director Hastey contacted the solicitor’s office on January 5, 1998, with a formal request for a legal opinion from the regional solicitor "regarding the conflict between Quechan religious beliefs and the Glamis Imperial Project."321 Director Hastey, referring to the government to government meeting, posed the First Amendment issue raised by the Quechan, requesting guidance:

The Quechan believe that this is a conflict between their protected right to practice religion under the First Amendment to the Constitution and the 1872 Mining Law; that by allowing the mining to occur the government will have violated their rights under the First Amendment and destroyed their ability to practice their religion where it must be practiced. What are our responsibilities to ensure that we do not violate the First Amendment? What are our responsibilities to the mining claimant to ensure that his proprietary rights are protected?322

9. Preliminary Feasibility Study

In addition to looking into the legal responsibilities and issues raised by the Imperial Project, BLM also began to assess the Imperial Project from a validity standpoint in early 2008.323 A decline in gold prices during the time the DEIS/DEIR was pending led to an eight-year low of $300 per ounce in the early months of 1998, which prompted concern among "interest groups" that the Imperial Project might not be financially viable.324 BLM’s California state office therefore sought a "preliminary market analysis of the public financial data for the Project."325 The purpose of the review was to "examine Glamis-Imperial’s published financial information on the project within the confines of the current and forecast gold market environment," and was not to determine the validity of the mining claims.326 The California desert district manager of the BLM appointed Mr. Waiwood to conduct the analysis.327
In February, following a preliminary feasibility study of the mine, Mr. Waiwood reported that "[a]s a result of [his] review of the project, [he] found that within the current economic market for gold, the Imperial Project will be profitable within the publicly stated technical and financial criteria available."328 As the feasibility study made the mine look, at least preliminarily, feasible, BLM did not plan to conduct "a full-blown mineral examination that could lead to a contest."329
Relying upon an examination of the recovery rate330 based on information requested from Steve Baumann, vice president of Glamis-Imperial, on March 31, 1998,331 Mr. Waiwood concluded that the Project would be marginally profitable over the life of the mine at the average gold price over the past decade and a half ($375 per ounce), but could face problems at the then current price of $300 per ounce.332 Therefore, Mr. Waiwood explained that the Imperial Project would not be profitable at the present time, but slight changes in the price of gold or cost of production could shift that:

Glamis-Imperial appears to have conducted the necessary work within the scope of the regulations, and of a ‘prudent operator in usual, customary, and proficient operations of similar character...’ (43 CFR 3809.0-5(k)). Within the scope and limitations of this review, I feel that the Imperial Project as proposed is the next logical and prudent step in the development of the Imperial deposits; however, with the performance of gold in the past 18 months yielding an uncertain forecast, under the assumptions provided, a present, positive value to the project, and hence a profit within a reasonable rate of return will not be realized.

In the conduct of any mineral investigation of the mining claims at the Imperial Project, a formal forecast of the gold price must be conducted by a qualified mineral economist. The margin of loss under my analysis is so low that small changes in the forecast gold price would render the property, under a formal mineral investigation, and all other facts being regular, profitable and valid.333

This conclusion alerted BLM to the possibility that denying the Project could result in a taking of rights under the Mining Law of 1872.334 As the mining claims were properly recorded and a "practical" Plan of Operations was submitted per the 3809 Regulations, BLM stated that the mining proposal appeared to have merit.335 The BLM also noted that, if such a finding were in fact made, compensation would be required under the No Project Option.336 BLM did not know the precise estimate of the mineral value, but expected that reasonable compensation would be substantial.337

10. Comments from the Advisory Committee on Historic Properties

Concurrently with the feasibility and legal examinations, in February 2008, BLM initiated consultation with the State Historic Preservation Officer ("SHPO") regarding potential effects to historic properties pursuant to Section 106.338 In a letter to the SHPO, BLM presented KEA’s recommendations for registration of prehistoric sites in the National Register and sought concurrence in the determination from the SHPO.339 In addition, the BLM sought the SHPO’s concurrence on its determinations of the adverse effects of the Imperial Project on the various properties.340 Finally, the BLM presented the different mitigation measures proposed by KEA and the interested parties, and invited discussion from the SHPO on ways to avoid or reduce the effects on historic properties.341
BLM formally requested comments from the Advisory Committee on Historic Properties ("ACHP") on the Imperial Project’s Plan of Operations on August 25, 1998,342 pursuant to paragraph 4.b.3 of the Nationwide Programmatic Agreement, which instructs the BLM to request ACHP’s review in "highly controversial undertakings."343 Noting that the Quechan had "expressed strong cultural concerns for properties in the APE,"344 the request detailed the potential effects of the Imperial Project on historic properties within the APE—including the Indian Pass-Running Man ATCC, the Trail of Dreams, and other trail segments and sites—and also those within the Project’s ancillary area and transmission line.345 The letter also described possible mitigation measures, as well as the Quechan belief that no mitigation, short of full avoidance, would be sufficient.346
The ACHP responded by appointing a working group of three ACHP members to manage the ground-level review of the Imperial Project.347 This task force, in light of the numerous public comments in response to the environmental impact studies and at the request of the BLM,348 held an additional public hearing on March 11, 1999. The hearing was held in order to "listen to what [the speakers] have to say and to learn about the impacts of the project, possible options for minimizing those impacts, and generally concerns about historic preservation issues surrounding this project."349 Claimant’s representatives spoke, as did 46 other speakers, including members of the Quechan Indian Tribe, public officials, private citizens, BLM officials, and members of the cultural survey teams.350
John Fowler, executive director of the ACHP, explained at the start of the hearing that "we’re in an unusual circumstance for two reasons."351 First, he explained that the Nationwide Agreement modified the usual ACHP review process so that aspects of the usual process were largely conducted internally within the BLM. Thus, he explained, "we’re not playing by the normal rules of the section 106 process."352 He continued,

[W]e are at a phase where it has been acknowledged that the proposed mining development will have adverse effects on properties of historic significance, so we’re really at the phase of looking at whether there are ways to allow that project to go forward and minimize the impacts on historic properties, or whether there should be some other action taken by the Federal Agency.353

The other unusual aspect of the hearing, Mr. Fowler stated, was the ACHP’s involvement in these discussions which normally are handled at the staff level.354 Mr. Fowler explained that the chairwoman of the ACHP, Katherine Slater, had designated the task force of council members because of the "complexity of the issues and the significance of the issues and the impact."355 This group was tasked with advising Ms. Slater and the staff on how to proceed in this particular case.356
Finally, Mr. Fowler described the three possible paths the evaluation of the Imperial Project could take following these consultations. First, the task force could work with the BLM as the consulting party to arrive at an agreed-upon solution that could contain specific mitigation measures and result in the Project moving forward "generally as planned." Second, the task force could recommend that the ACHP issue formal comments to the secretary of Interior, in which case, Mr. Fowler made special note, the comments would be purely advisory and it would be up to the secretary of Interior and the director of the BLM to make a final decision. Third, the task force could decide that further steps were necessary for the BLM to take with the mining company to "assess alternatives orto investigate mitigation measures."357
On the same day as the public hearing, the ACHP task force also conducted a site visit of the area.358 In addition to the task force, representatives of the Quechan Indian Tribe and Claimant attended the tour.359 The ACHP visited the Running Man site, the Indian Pass ACEC and the Indian Pass Wilderness, as well as examined at least one trail segment on the edge of the Project area.360 At least one report, however, states that further exploration of the actual proposed disturbance area was minimal.361
The ACHP task force also engaged in direct meetings and correspondence with Claimant, the Quechan Indian Tribe and officials at the BLM.362 The ACHP task force met with members of the Quechan Indian Tribe on May 8, 1999, and with Claimant’s representatives on July 14, 1999.363 In addition, Claimant, in letters to John M. Fowler on May 18, 1999, August 13, 1999, and August 18, 1999, described its position and summarized the proposed mitigation measures for the ACHP to use during its review of the Imperial Project.364 Claimant explained how much of the harm could be avoided or reduced through its proposed mitigation measures, though it acknowledged that some harm would come to the Quechan’s trail system.365 Counsel for the Quechan Tribe also corresponded with the BLM on April 12, 1998, and with Director Fowler of the ACHP on July 13, 1999, explaining the religious significance of the area and the Quechan’s concerns regarding its loss, disputing some of Claimant’s factual positions and requesting the ACHP’s "strenuous opposition to the proposed mine."366
Following these consultations and its own analysis of the Imperial Project, the ACHP followed the second possible path of evaluation described above, determining that further consultations would not be productive and, pursuant to its statutory authority, issued its comments to the secretary of Interior on October 19, 1999.367 The ACHP informed Secretary Babbitt of the "religious, cultural and educational values of the Indian Pass-Running Man... ATCC" that are of "premier importance to the Quechan Tribe for sustaining their traditional religion and culture."368 The ACHP also cited that the site, despite the region’s rather extensive development projects, had "retained sufficient integrity of setting, feeling, and association to remain a critically important area for traditional uses."369 The ACHP explained its view that the Imperial Project would "unduly degrade" the area and that no mitigation measure proposed would avoid the "serious and irreparable degradation of the sacred and historic values of the ATCC that sustain the tribe."370 The ACHP also cited the consistent and overwhelming opposition from both the Tribe and the public to the Project. Based on these findings, the Council concluded that "the Glamis Imperial Project would effectively destroy the historic resources in the project area, and recommend[ed] that Interior take whatever legal means available to deny approval for the project."371

11. BLM Withdrawal of the ATCC from Future Mining Claims

During the time that the ACHP was reviewing and evaluating the Imperial Project, BLM also was considering withdrawing the affected land from future mineral entry.372 On June 24, 1998, the BLM field office made a formal recommendation to BLM State Director Hastey that BLM consider withdrawing the land encompassed in the KEA-identified ATCC.373 The stated purpose for such a withdrawal was to set aside:

[approximately 9,360.74 acres in Eastern Imperial County... from further entry to protect the archaeological and Native American religious values.... The withdrawal would segregate the lands from nondiscretionary uses, i.e., mining, which could irrevocably destroy and/or negatively impact the archaeological and Native American religious values of the property. The withdrawal would be subject to valid existing rights, but would segregate from any new mineral entry to prevent additional claims from being filed.374

In addition, as discussed in the proposed Indian Pass withdrawal application, "[w]ithout a withdrawal, BLM would not have the discretion to deny authorization of a mining plan of operation if the claimant complies with applicable regulations."375

Claimant’s representatives were assured in a meeting on July 17, 1998 that "the Glamis claims and mine plan would have defacto [sic] valid existing rights (VER) as of the date of the withdrawal pending the outcome of a formal VER" and that "[t]he BLM review of their mine plan and EIS would continue as scheduled prior to the withdrawal."376
The BLM petition/application to withdraw the designated lands was filed in June 1998,377 and approved by the assistant secretary on October 26, 1998.378 A notice of the proposed withdrawal was subsequently published in the Federal Register on November 2, 1998.379 The lands were temporarily segregated for two years upon publication in the Federal Register', this was to allow BLM sufficient time to prepare the studies and analyses it required to make its final decision.380

12. Mineral Validity Determination

On September 15, 1998, BLM formally initiated a mineral validity examination ("VE") of the Imperial Project mining claims.381 The reason for the examination was that the initial review of the proposal had confirmed conflicts with significant non-mineral resource values that resulted in the consideration of withdrawal of the area to protect these resources.382 If such a subsequent right intervened, Claimant "must have perfected (as supported by subsequent mineral investigation by the BLM) [its] discovery prior to that date to create a valid existing right (‘VER’)."383 The work plan for the mineral examination further explained BLM’s duty in such a situation: "BLM has a responsibility... to ensure that valid mining claims are recognized, invalid ones eliminated, and ensure that the rights of the public are preserved. BLM conducts an investigation of mining claims to verify that a discovery of a valuable mineral exist [sic] on each mining claim."384
To complete the mineral validity examination, the BLM did not "duplicate what is claimed as a discovery by the claimants," but sought to verify that the data provided by Claimant to support its discovery was "acquired in compliance with professional standards of practice and ethics."385 This verification required reviewing the data through "geologic mapping of the project area, sampling of discovery locations, the completion of a market analysis of the gold price over the life of the operation, [and verification] that mine engineering and planning [was] supported by the mineralization on the subject mining claims through an economic analysis of the project and alternatives."386
This process determines if discovery is supported, thus creating a valid existing right that can stand up to a subsequent intervening right, such as withdrawal.387 If withdrawal did segregate the area, mill sites policy dictated that an additional examination of alternative sites be undertaken. This, the work plan explained, cannot be completed until a Record of Decision ("ROD") is completed for the Plan of Operations ("POO") and, thus, "[n]o approval to the project [would] be made until the VER and ROD agree regarding allowable operating parameters and limitations."388
The greatest concern with respect to the completion of the VE was examination of the regional geology "to develop attributes to the property that will assist in the deposit modeling."389 Discussed at greater length among BLM staff and the solicitor’s office, however, was the determination of what gold price to use in the analysis.390 Historically, an average of gold prices over the previous 10 years was utilized but, in light of the market at that time, with the dumping of gold reserves by the central banks of Eastern Europe and basic oversupply, many experts tried to predict instead what the future price of gold would be.391
The examination began in September 1998 on an expedited schedule with completion expected on December 31, 1998.392 In November and December 1998, the BLM examiner requested additional métallurgie tests on ore samples from the Imperial Project.393 As of December 15, 1998, however, completion of the mineral examination was not expected until between mid-January and mid-March 1999, around the same time as the ROD’s anticipated completion.394 This adjustment was apparently caused, at least in part, by the fact that the solicitor’s M-Opinion (discussed below) was still in the drafting stages and Solicitor Leshy requested that the validity examination (and the final EIS) be delayed until this M-Opinion was closer to completion.395 In February 1999, BLM twice contacted Claimant requesting further information.396 In April and June of 1999, Claimant notified BLM that it wished to use a higher gold recovery rate.397 In November 1999, however, in anticipation of the solicitor’s M-Opinion, BLM directed that work on the VE be halted, even though the examination was substantially complete by this point.398

13. DOI Solicitor’s 1999 M-Opinion

John Payne of the Interior regional solicitor’s office was initially tasked with analyzing some of the issues raised by Director Hastey in January 1998, regarding the BLM’s responsibility with respect to the First Amendment and Claimant’s proprietary rights. In the summer following the initial request, Mr. Payne completed an initial analysis of the First Amendment question. In that informal opinion, Mr. Payne cited Lyng v. Northwest Indian Cemetery Protective Association, in which the U.S. Supreme Court held that the First Amendment’s free exercise clause would not prohibit the U.S. Forest Service from permitting timber harvesting on federal lands that historically had been used by Native Americans for religious purposes.399 Following this decision, Mr. Payne concluded that it would be "hard to imagine a federal land management decision which would be considered a violation of [N]ative [A]merican first amendment rights by the courts. BLM seems to have met its obligations to consult."400
A formal opinion with respect to both questions took longer for the solicitor’s office to formulate. After inquiries by the BLM in October of 1998, as to the expected completion of the memorandum,401 Solicitor Leshy wrote directly to BLM State Director Hastey stating his understanding that BLM was getting a "hard time" about the delay, but that the legal issues were "complicated and precedent-setting."402 At this time, he did give some information concerning the content of the future opinion, explaining that the "‘first amendment’ issue [was] not really the important one; instead, the fundamental question [was] how should the legal standard of preventing ‘unnecessary or undue degradation’ be applied to this mining proposal... "403 As regarding when the BLM could expect the formal opinion, he wrote, "I expect to review a draft memo on these issues when I get back in the country in a couple of weeks. Rest assured this is a high priority with me, and our folks are working hard on it. In the meantime your folks should delay completion of the validity examination and the final EIS."404
Solicitor Leshy visited the Imperial Project and met with BLM officials on February 22 and 23, 1999.405 The visit’s intent, as described by BLM official Glen Miller, was to examine the religious and cultural values of the site itself, the potential visual impacts to the Running Man Trail, the possible marginal nature of the mining operation, and the possibilities for and expenses of mitigation.406 During this visit, BLM held a meeting with the visiting members of the solicitor’s office, at which several issues were discussed, ranging from the adequacy of the draft EIS and the "Advisory Council role in defining alternatives" to attempting to attain agreement on the method for determining the price of gold to be used.407 The main objective of the meeting, however, as expressed in its title, was the need to establish a "threshold for undue impairment."408
In addition, during the legal review necessary for the drafting of the M-Opinion, public input was received and reviewed by the solicitor’s office. Prior to the M-Opinion’s completion, for instance, Claimant submitted written comments to be addressed by the M-Opinion and met with Solicitor Leshy concerning the M-Opinion.409 Consequently, the M-Opinion addressed three of Claimant’s arguments directly in its text.410
Solicitor Leshy issued the 1999 opinion, known as the "M-Opinion," on December 27, 1999; it was approved by the secretary of the Interior on January 3, 2000.411 At the start, the M-Opinion established that the measures that might result from the legal authority provided by the M-Opinion could result in the Project becoming uneconomical:

Because the ore body is of somewhat lower grade than that found at most operating mines, the ratio of metal recovered to material disturbed is lower than found in many other operations, particularly for a start-up operation.... The low grade of the ore may so affect the profit margin that the imposition of reasonable environmentally protective restrictions or mitigation measures may make the venture unprofitable.412

Next, the M-Opinion cited the ACHP’s recommendation that advised on the "‘religious, cultural and educational values’ in the area ‘of premier importance to the Quechan Tribe for sustaining their traditional religion and culture’ that the proposed mine would unduly degrade" and for the loss of which no available mitigation measures would be adequate to compensate.413 Because of these findings, the ACHP had recommended "that Interior take whatever legal means available to deny approval for the project."414 Claimant’s representative responded to the ACHP’s recommendation with a 14-page letter dated November 10, 1999.415 The M-Opinion explained that it was responding to the ACHP’s recommendations and Claimant’s letter and, in particular, answering two questions:

What limits or obligations does the First Amendment to the U.S. Constitution place on the BLM in this context?

To what extent does the Federal Land Policy and Management Act authorize or oblige the BLM to protect the cultural and historic resources of the ATCC in connection with the Glamis proposed plan of operations?416

With respect to the first issue regarding possible First Amendment protection of Native American religious rights, the M-Opinion was consistent with the early information provided by John R. Payne, an attorney at the solicitor’s office.417 Stating that the Lyng decision controlled application of the First Amendment to the Glamis proposal, the M-Opinion explained that "[t]he Constitution does not compel rejection of the proposed mining plan on the basis of its potential impact on tribal religious practices. But, like the Forest Service in Lyng, the BLM here could make efforts to accommodate tribal interests through exercise of its regulatory authority."418 The M-Opinion elaborated briefly on the accommodations that the BLM could make, especially in light of the passage of the Executive Order on Sacred Sites, E.O. 13007, after the holding in Lyng. The M-Opinion advised that the Executive Order, when combined with the efforts to accommodate required by Lyng, would direct the BLM "to a policy choice in favor of preserving the physical integrity of the sites unless such a choice [was] impracticable, forbidden by law, or clearly inconsistent with essential agency functions."419
With respect to the second question regarding the obligations under FLPMA to protect cultural and historic resources, the M-Opinion first reviewed the various statutory protections. To begin, it reviewed the "unnecessary or undue degradation" standard of Section 302(b), explaining that the BLM’s current regulations codified a "prudent operator" standard under which a disturbance was not generally allowed when it was greater than the disturbance that would normally result from a prudent operator.420 Citing the preamble to the BLM’s regulations, the M-Opinion explained that, in addition to ensuring compliance with the prudent operator standard, BLM also had to ensure that "reasonable and practical" mitigation was chosen that would best protect "other resources."421 Under this portion of the regulations, however, "while BLM [could] mitigate harm to ‘other resources,’ it [could] not simply prohibit mining altogether in order to protect them."422 The M-Opinion therefore summarized: "The ‘unnecessary or undue degradation’ standard does not by itself give BLM authority to prohibit mining altogether on all public lands, because Congress clearly contemplated that some mining could take place on some public lands."423 The question, therefore, with respect to this Project, was "not whether the proposed gold mine cause[d] any degradation or harmful impacts, but rather, how much and of what character in this specific location."424
Next, the M-Opinion explored the "undue impairment" standard that is included within discussions of the CDCA: BLM shall "protect the scenic, scientific, and environmental values of the public lands of the [CDCA] against undue impairment...."425 The M-Opinion stated that this authority was "separate and apart" from that which allows BLM to prevent unnecessary or undue degradation and was, in fact, stronger than the prudent operator standard.426 Therefore, according to the M-Opinion, the BLM was "not confined to restrictions that may be imposed on a ‘prudent operator in usual, customary and proficient operations of similar character’ in carrying out its duty to prevent ‘undue impairment.’"427 After discussing the extra protection afforded to Class L (Limited Use) lands within the CDCA,428 the M-Opinion summarized its findings:

‘Undue impairment,’ as explained above, must mean something more than the prudent operator standard currently in the BLM definition of ‘unnecessary or undue degradation,’ but it cannot mean so much as vesting the Secretary with authority to prohibit all hardrock mining in the CDCA. Plainly the ‘undue impairment’ standard would permit BLM to impose reasonable mitigation measures on a proposed plan of operations that threatens ‘undue’ harm to cultural, historic or other important resources in the CDCA. Moreover, the reasonableness of those mitigation measures ought not to be judged by whether they make the particular operation uneconomic at current market prices for the mineral commodity proposed to be mined. Beyond that, the ‘undue impairment’ standard might also permit denial of a plan of operations if the impairment of other resources is particularly ‘undue,’ and no reasonable measures are available to mitigate that harm. As stated above, the CDCA Plan clearly appears to contemplate such a result.429

The M-Opinion then explained that "[t]he ultimate responsibility for making the decision on ‘undue impairment’ is the BLM’s."430 It closed with the conclusion that, "[i]n the end, what is determined to be ‘undue’ is founded on the nature of the particular resources at stake and the individual project proposal. If the BLM agrees with the Advisory Council, it has, in our view, the authority to deny approval of the plan of operations."431
Claimant responded to the issuance of the M-Opinion by filing suit in federal court in Nevada challenging the M-Opinion on April 13, 2000.432 Arguing that the M-Opinion "arbitrarily and capriciously create[d] a new decisionmaking structure for evaluating the Glamis plan of operations that exceeds the statutory authority and intent of the [FLPMA],... its implementing administrative regulations and directives, and the California Desert Protection Act of 1994,... and is contrary to prior, consistent Interior Department interpretations of law," Claimant requested that the court declare invalid and enjoin implementation of the M-Opinion.433 Pending resolution of this suit, Claimant requested that BLM suspend the preparation of the Final Environmental Impact Statement, the processing of its Plan of Operations and the issuance of its Record of Decision to save money and resources.434 The BLM, however, decided to complete the FEIS and continue the review of the Plan of Operations throughout the legal challenge.435
On October 31, 2000, the federal court in Nevada dismissed the suit finding that it lacked subject matter jurisdiction as Plaintiff did not appeal a "final agency action," in that: (1) the action did not "mark the consummation of the agency’s decision making process," and (2) was not "one by which rights or obligations [had] been determined, or from which legal consequences [would] flow."436 The court added that "[a]lthough the Glamis Opinion Letter [might] harm the Imperial Project’s chances of ultimate approval, it [did] not mandate the BLM’s final decision."437 Therefore, the court found that "[b]y bringing this suit, Glamis did not seek judicial review of an agency’s decision, but rather, impermissible judicial interference in an ongoing administrative process."438

14. Final Environmental Impact Study

The Final Environmental Impact Statement/Report was issued in September 2000.439 It was arguably delayed by BLM’s need for various information that was to be provided by the solicitor’s office, and thus for the issuance of the M-Opinion. On October 30, 1998, Solicitor Leshy requested State Director Hastey to delay completion of the validity examination and final EIS.440 This was followed by a November 12, 1998 BLM "Glamis Schedule" which stated that the schedule for completing the EIS, ROD and VER "may be slipping."441 The revised Imperial Project EIS schedule, as of December 4, 1998, also reflected the delays caused by four steps in the EIS process awaiting the solicitor’s M-Opinion.442 Apparently in light of the uncertainty as to completion date of that M-Opinion, the December 1998 schedule was marked, "[t]here is no schedule."443 A subsequent schedule again described delays in the review of the Imperial Project; it attributed half of the delay to waiting on involvement from the solicitor’s office.444
In a reversal from the prior draft environmental impact studies, the 2000 FEIS chose as its preferred alternative that of "No Action."445 This determination meant that:

[T]he Project area would remain as is, and present uses in the area, including opportunities for dispersed recreational activities, would continue. The Project area would remain available for future commercial gold processing proposals or for other proposals as permitted by BLM policy or land use designations.446

BLM came to this conclusion "[b]ased upon findings in [the] EIS/EIR, agency and public comments, the Solicitor’s Opinion on the regulation of Hardrock Mining..., and extensive consultation with the Advisory Council on Historic Preservation."447 With respect to cultural resources, the 2000 FEIS found that "[t]he Indian Pass-Running Man ATCC, including the Trail of Dreams; seven (7) multi-component archaeological sites; and twelve (12) prehistoric trail sites in the Project mine and process area, each of which are evaluated as eligible for the NRHP... would not be avoided under the Proposed Action."448

The 2000 FEIS also cited Solicitor Leshy’s M-Opinion in its discussion of the requirements demanded by the "unnecessary or undue degradation" and "undue impairment" standards. It explained:

This opinion found that the unnecessary or undue degradation standard... allowed BLM to require reasonable mitigation measures to protect resources, but did not by itself give BLM the authority to prohibit mining altogether on public lands. Because the Proposed Action would be located within the... (CDCA), the opinion went on to analyze the ‘undue impairment’ standard.... The opinion found that the ‘undue impairment’ standard would permit BLM to impose reasonable mitigation measures to prevent undue impairment, and that the standard might also permit denial of a plan of operations if the impairment of other resources is particularly ‘undue,’ and no reasonable measures are available to mitigate that harm.449

The CEQA lead agency, Imperial County, was required to pick an "Environmentally Superior Alternative" from the other project alternatives if a No Project (No Action) alternative was chosen as the Environmentally Superior Alternative.450 In other words, the lead agency is requested, when it decides that the alternative that "would result in the fewest significant environmental action" is no action, to also determine which of the action alternatives that allows for development is the next best option for the environment.451 Imperial County chose the "Proposed Action, as amended by the measures identified to reduce the adverse effects of the Project provided in [the] Final EIS/EIR."452

15. Completion of Withdrawal from Mineral Entry

On October 27, 2000, the Department of the Interior issued a final withdrawal of 9,360 acres, including the Imperial Project area and surrounding public lands, from further mineral entry for 20 years.453 The withdrawal was enacted to protect historic properties, Native American values, and the visual quality of the ATCC.454 The withdrawal also was designed to protect portions of the Indian Pass ACEC, and of the Indian Pass and Picacho Peak wilderness areas.455 The withdrawal included approximately 6,000 acres of mining claims held by Claimant.456 The withdrawal was subject to valid existing rights, but it still resulted in the prohibition of Claimant, or others, locating new mining claims or mill sites in the area to respond to changing conditions in project development and mining.457 The withdrawal also triggered the need for the preparation of validity determinations to analyze if mining claims were "valid existing rights" at the time of the withdrawal.458

16. Issuance and Rescission of the Record of Decision for the Imperial Project

On January 17, 2001, Secretary of the Interior Bruce Babbitt signed a Record of Decision ("ROD") that denied the Imperial Project’s Plan of Operations.459 In this decision, Secretary Babbitt wrote:

After extensive analysis, public review and comment, and application of pertinent Federal laws and policies, it is the decision of the Department of the Interior, based upon the recommendation of the BLM, not to approve the plan of operations for the Imperial Project. This represents the No Action alternative as specified in the FEIS/EIR published jointly by BLM and Imperial County on November 17, 2000.460

Secretary Babbitt explained that the ROD was based on several "key factors determined to be unique to this particular proposal." These included that: (1) "the proposed project [was] located in an area determined to have nationally significant Native American values and historic properties and would cause unavoidable adverse impacts to these resources;" (2) "the impacts of the proposed project [could not] be mitigated to the point of meeting the statutory requirement in FLPMA that BLM must prevent ‘undue impairment’ of the public lands in the CDCA;" and (3) "the proposed project fail[ed] to meet the overall statutory requirement in FLPMA that BLM must prevent ‘unnecessary or undue degradation’ of the public land resources."461
In making the factual determinations of the existence of nationally significant Native American values and the inability of mitigation measures to protect these resources, the ROD "relie[d] heavily upon the advice of the Advisory Council on Historic Preservation."462 In "interpreting the legal authorities pertaining to this particular project," the ROD relied upon the solicitor’s December 27, 1999 M-Opinion, and in particular, its description of the nature of "BLM’s discretionary authority under the statutory standards of‘undue impairment’ and ‘unnecessary or undue degradation.’"463
Claimant responded to this decision by writing off its $14.3 million investment in the Imperial Project and eliminating its reserves.464 Claimant told its shareholders, however, that it intended to appeal the decision,465 which it did in federal District Court in the District of Columbia on March 12, 2001, challenging both the ROD and the October 27, 2000 withdrawal.466 Following the November 23, 2001 rescission of the ROD (discussed below), however, Claimant withdrew this suit.467
On October 23, 2001, the new Interior Solicitor Myers, with the concurrence of the new Secretary of the Interior Norton, rescinded Leshy’s 1999 M-Opinion468 and recommended the "rescission and reconsideration of any decisions made by the Department to deny a plan of operations based on the [undue impairment] phrase... includ[ing] Secretary Babbitt’s decision denying Glamis’s plan of operations."469 Solicitor Myers explained that "[t]he Department’s adoption of the ‘substantial irreparable harm’ criterion [had] generated considerable controversy and litigation because the criterion authorizes the Department to entirely prevent mining activity, even when the mine operator has otherwise complied with all other relevant statutory and regulatory requirements."470
Because of this controversy, including the litigation engendered from the 2000 regulations and the denial of Claimant’s POO, Solicitor Myers reviewed the legal bases for both actions and rejected some of the conclusions of the 1999 M-Opinion.471 He concluded that "relevant legal authorities" required the removal of the "substantial irreparable harm" criterion from the definition of "unnecessary or undue degradation," and that the Interior should not apply the "undue impairment" provision until it completed rulemaking to establish standards defining the term.472 Because regulations had not yet been promulgated defining the term, he recommended the rescission and reconsideration of any decisions made to deny plans of operations based on application of the "undue impairment" provision, including the denial of Claimant’s proposal.473
On November 23, 2001, the ROD was formally rescinded, based on the legal analysis of the 2001 Myers Opinion, so that the Imperial Project gold mine proposal could be reconsidered.474

17. Resumption of Validity Determination

On February 13, 2002, BLM resumed work on the validity examination of Claimant’s Imperial Project mining claims,475 after it was placed in suspension awaiting the M-Opinion and pending completion of review of the Plan of Operations.476 BLM State Director Mike Pool stated that he decided to conduct the validity examination because the area under consideration had been withdrawn from mineral entry, subject to valid existing rights.477 He also explained that the validity determination was the first step in the reconsideration process of the Project’s Plan of Operations.478
During the mineral examination, Claimant’s representatives met with various representatives of the Department of the Interior to discuss the validity examination and other issues confronting the Imperial Project. In nine face-to-face meetings with DOI officials, as well as other correspondence and telephone conversations, between January 2001 and September 2002, Claimant’s representatives expressed their frustration with the many delays in the mine approval process, and in particular the delays in the conduct of the VE, and encouraged the officials to expedite the VE process.479 Representatives of the Quechan Indian Tribe also met twice with DOI officials during this period.480
In its September 27, 2002 Mineral Report, BLM officially determined that Claimant’s mining claims were valid:

Glamis has found minerals within the boundaries of the 187 lode mining claims and the evidence is of such a character that a person of ordinary prudence would be justified in the further expenditure of labor and means, with a reasonable prospect of success, in developing a valuable mine. The requirements of the mining laws of the United States have been satisfied for these mining claims on the critical dates of November 1998 [the date of segregation and withdrawal] and April 2002 [the date of the completion of the examination].481

Using average gold prices ranging between $325 (1998) and $296 (2002), the report determined that the Imperial Project claims "contain[ed] a gold deposit that can be mined and processed... at a profit."482 The report also concluded, after analyzing the backfilling of the East Pit, that such backfilling was not economically feasible.483

18. Re-Examination of Imperial Project Plan of Operations

Prior to resumption of the validity examination, Claimant requested BLM to review the Plan of Operations for the Imperial Project and issue a new Record of Decision.484 An internal Interior briefing document of October 24, 2002, shows that, prior to issuing a new ROD, Interior thought it necessary to review the 2000 FEIS to determine if it was still an adequate basis for approval or denial decision with respect to the proposed Plan of Operations.485 This document explains that the process was ongoing as of that date, and would take an estimated three months to complete.486
Soon after the issuance of the Mineral Report, however, Nevada’s U.S. senators and one congressman requested Secretary Norton to conduct an appraisal of Claimant’s mining claims and attempt to reach a negotiated agreement for the government’s acquisition of Claimant’s property interests.487 While this settlement process was pending, Claimant, on December 9, 2002, requested BLM to suspend its ongoing review of the Imperial Project Plan of Operations.488 BLM responded on January 7, 2002, stating that it was willing to suspend processing of the POO, but only if Claimant submitted its request again, "not conditioned on preparation of an appraisal and relieving BLM of any legal liability... for the suspension."489 Claimant responded on March 31, 2003, that it would not reconfirm its suspension request, as it had "no reasonable expectation that an alternative resolution for the Imperial Project [was] likely."490
BLM thus continued its review of the Imperial Project Plan of Operations, as well as discussing options for a buyout and whether Senate Bill 22 and the California SMGB amendments applied to Claimant (the latter two measures are discussed below).491 Any review of the Imperial Project Plan of Operations ceased on July 21, 2003, however, when Claimant filed its Notice of Intent to Submit a Claim to Arbitration under Chapter 11 of the NAFTA, and made no further request that DOI continue the processing of its Plan of Operations.492

D. California Measures

1. California Legislation

a. Senate Bill 483

Senate Bill 22 ("SB 22"), enacted in April 2003,493 put into effect the mandatory backfilling requirements regarding which Claimant complains. Its foundations, however, began earlier with a series of California legislation that evolved into SB 22. The first legislation was California Senator Byron D. Sher’s introduction of Senate Bill 483 ("SB 483") on February 22, 2001.494 This bill, which would have amended SMARA to allow the director of Conservation additional time to remediate or reclaim abandoned mined lands,495 was amended several times in mid-2001 and again in August 2002, to add language to include the protection of Native American sacred sites.496 The amended SB 483 prohibited lead agencies from approving any reclamation plan and financial assurances for the surface mining of gold, silver, copper or other metallic materials on, or within one mile of, any Native American sacred site in an area of special concern, unless the reclamation plan provided that "all excavation [would] be backfilled and graded to achieve the approximate original contours of the mined lands prior to mining, and the financial assurances [were] sufficient in amount to provide for the backfilling and grading."497
The "program background" provided by the Governor’s Office of Planning and Research on SB 483 explained the legislation’s focus on the Imperial Project:

SB 483 contains narrowly-crafted language intended to prevent approval of a specific mining project proposed for an Imperial Valley location by Glamis Gold, Inc. The proposed project would impact an area known as Indian Pass, where a system of sacred trails is an important part of the Quechan Tribe’s spiritual and cultural base. The provisions in SB 483 [as amended] are identical to the SMARA provisions in SB 1828, and are intended to affect only this particular project.498

b. Senate Bill 1828

Next, California Senate President pro Tempore John L. Burton introduced Senate Bill 1828 ("SB 1828") on February 22, 2002.499 The bill declared that it was state policy "to protect the ability of Native Americans to freely practice their religion in a traditional and meaningful way, in natural areas, and at sacred sites associated with those religious practices."500 In its initial form, SB 1828 merely stated that it was the "intent of the Legislature that the California State Government support Native American tribal religious rights, and take action to ensure that Native Americans have the opportunity to practice their religion freely... and examine and study the use of Native American sacred sites, and related lands and facilities within the state to determine the best ways of ensuring the continued protection and preservation of those sites."501
Possibly in promotion of the latter half of this objective, State Senator Burton commissioned a study by the California Research Bureau ("CRB") to identify "a few examples of disputes or conflicts related to sacred places in California."502 The CRB reported on four disputes that had been previously discussed in public forums or which tribes had given their permission to disclose publicly,503 one of which was the Imperial Project, the only mining project identified.504
One week after the CRB memorandum, on April 1, 2002, State Senator Burton proposed amendments to SB 1828 to prohibit the issuance of a permit by a state agency if: (1) an affected Native American tribe declared that a project would adversely impact a sacred site, or (2) the site was certified as a sacred site, unless the tribe accepted proposed mitigation measures.505
The legislative history to SB 1828 explains that the impetus for the bill was "a particular situation in which a proposed capital project in Imperial County would cause adverse impacts to a Native American sacred site.... The proposed Glamis gold mining project would be located in the middle of the Quechan’s most sacred trail systems, including the Trail of Dreams."506 The history also states that "there are potentially thousands of sites in California that are sacred to one or more of the many federally-recognized tribes... in California."507

c. SMARA Native American Sacred Sites Bill

On August 26, 2002, the California legislature introduced the "SMARA Native American Sacred Sites Act," which amended both Senate bills 483 and 1828 to require the complete backfilling and re-contouring of all surface hardrock mining operations.508 Specifically, both legislation would now:

[P]rohibit a lead agency from approving a reclamation plan and financial assurance for a surface mining operation for gold, silver, copper, or other metallic minerals that [was] located on, or within one mile of any Native American sacred site, as defined, and in an area of special concern, as defined, unless the reclamation plan require [d] that all excavation be backfilled and graded to achieve the approximate original contours of the mined lands prior to mining, and the financial assurance [was] sufficient in amount to provide for that backfilling and grading.509

Senate Bill 483 was a "trailer bill" to SB 1828, meaning that "none of the provisions of SB 483 would become operative unless SB 1828... [was] also signed into law."510 On September 30, 2002, Governor Davis vetoed SB 1828, in part because it made key changes to the CEQA process that were highly controversial, including giving Native Americans an unparalleled influence over the CEQA process.511
On the same day however, the governor did sign SB 483, though this was largely symbolic as the bill could not become operative without the signing of SB 1828.512 In his Signature Message, Governor Davis explained his support for SB 483, in that it would "protect[] Native American sacred sites from the adverse environmental effects of proposed mining operations."513 He also highlighted that the bill "would prevent mines, such as the Glamis gold mine in Imperial County, from being developed unless sacred sites are protected and restored. [He] strongly oppose[d] the Glamis gold mine because it would irreparably damage sites sacred to the Quechan Indian Tribe."514 With his signature, he further explained that he also was directing the secretary of Resources "to pursue all possible legal and administrative remedies that will assist in stopping the development of the Glamis gold mine."515

d. Senate Bill 22

The California legislature enacted Senate Bill 22 on April 7, 2003, decoupling Senate bills 1828 and 483, thereby enabling the previously passed language of SB 483 to become law,516 providing that a lead agency could not approve a reclamation plan for a hardrock surface mining operation if it was "located on, or within one mile of, any Native American sacred site and [was] located in an area of special concern," unless: (1) the reclamation plan provided for all excavations to be backfilled and graded to the approximate original contours of the land and excess materials graded over the project site to achieve the approximate original contours, and (2) financial assurances were sufficient to provide for this backfilling and grading.517 These provisions do not apply to any mining operation for which the lead agency had issued a final approval of a reclamation plan and financial assurances prior to September 1, 2002.518
The bill also included an urgency measure, so that it would be enacted immediately.519 The background provided by the bill’s authors explained the rationale behind this clause:

SB 483 needs to be made operative immediately because of provisions that establish new reclamation requirements for strip mining operations for gold, silver and other precious metals that affect Native American sacred sites in portions of the Southern California desert. These changes to statute are urgently needed to stop the Glamis Imperial mining project in Imperial county proposed by Glamis Gold, Ltd, a Canadian-based company. The project is a massive, open-pit, cyanide heap-leach gold mine on 1,500 acres of public land that would destroy sacred sites of critical religious and cultural importance to the Quechan Indian tribe....

The mining site would irreparably harm both ends of the Quechan’s spiritual trail, the ‘Trail of Dreams.’... The tribe has not only historically used this site, but currently continues to use the site for religious, cultural and educational purposes.

... The author believes the back-filling requirements established by SB 483 make the Glamis Imperial project infeasible.520

Analyses of the bill recognized that the measure would "permanently prevent the approval of the Glamis Gold Mine project and any other metallic mineral projects that presented an immediate threat to sacred sites located in areas of special concern."521 They also recognized that, with respect to the Imperial Project, the Project would have otherwise been allowed to "go forward" under the then current law.522

2. State Mining and Geology Board Regulations

As discussed previously,523 the State Mining and Geology Board is mandated by the 1975 Surface Mining and Reclamation Act ("SMARA") to "adopt regulations that establish state policy for the reclamation of mined lands in accordance with [SMARA]."524 Such state policy was to include, but not be limited to: "measures to be employed by lead agencies in specifying grading, backfilling, resoiling, revegetation, soil compactation, and other reclamation requirements... "525 SMARA requires mined lands to be reclaimed "to a usable condition which is readily adaptable for alternate land uses and creates no danger to public health or safety."526
Although SMARA requires mining lands to be restored to a "usable condition," the California Resources Agency of the Davis administration had become "increasingly concerned" by 2002, "with the impact that large metallic mining projects, particularly those involving the cyanide heap leach extraction process, have on the environment of California."527 Local lead agencies were interpreting "usable condition" to include "open space," resulting in open pits remaining on the landscape.528 The California Legislative Analyst’s Office ("LAO"), in its 2001-02 budget bill analysis, found that provisions of SMARA were not being enforced at a "potentially significant" number of mines.529 It also found that the Department of Conservation had "seldom determined whether reclamation plans and financial assurances substantively compl[ied] with SMARA."530 The LOA therefore recommended the legislature to direct the Department of Conservation to submit a plan for the monitoring of the adequacy of reclamation plans and financial assurances.531
On October 17, 2002, the California secretary of Resources contacted the chairman of the SMGB, asking the board to consider "adopting state regulations which would alter the current state reclamation policies" at its next meeting.532
The SMGB considered the request, as asked, at its November 14, 2002 meeting.533 At this meeting, four alternatives were considered: (1) make no regulatory change, (2) adopt regulatory language through the standard, non-emergency process, (3) consider a workshop prior to the adoption of regulations, and (4) include exemptions for some open pit metallic mines from the requirements of backfilling and recontouring.534 Subsequently, at its December 12, 2002 meeting, after review of the applicable regulations with respect to reclamation requirements and the specific reclamation issues facing very large excavations, the SMGB found that "the adoption of the proposed regulation requiring backfilling and site recontouring of open pit surface mine excavations for metallic minerals [was] necessary for the immediate preservation of the public general welfare."535
The factual basis for this finding was that there was currently pending with the BLM "an application for approval of a plan of operations for a large open pit gold mine (the Glamis Imperial Project), along with a requested approval of a joint EIS/EIR for the operation."536 The SMGB found that:

If this mining operation and the attendant reclamation plan are approved, and the joint EIS/EIR certified and approved for the operation and reclamation plan, without the requirement to backfill and recontour the lands disturbed by the mining activities, then an open pit with a length of approximately 4,700 feet, a width of approximately 2,700 feet, and a depth in excess of 800 feet, permanently will be left as a scar on the California landscape and an endangerment to the natural environment. At the same time, the surrounding landscape will be additionally marred and the environment threatened by a waste rock pile or piles which will contain residual harmful solutions and be up to a mile or more in total length and up to 300 feet in height above the natural grades.

In order to protect the California landscape and environment by requiring the reclamation plan for the pending mining operation to comply with the standards set forth in this emergency regulation, and to establish an environmental protection standard for this and other mine operation and reclamation plan approvals which may be pending at this time, but of which the SMGB is unaware, and which might receive approvals before a permanent regulation establishing the reclamation and environmental protection standards set forth in this regulation can be established, this regulation is required to be adopted and placed into effect on an emergency basis.537

The emergency regulations, effective on December 18, 2002, required that "the reclamation plan for an open-pit metallic mining operation... comply with the requirements set forth in Public Resources Code Sections 2711, 2712, 2733 and 2773" and, specifically, that all metallic minerals be "backfilled to achieve not less than the original surface elevation" and shall not "exceed in height the pre-mining surface contour elevations by more than 25 feet."538 The regulations, unlike SB 22, apply to all metallic mines, regardless of their proximity or lack of proximity to Native American sacred sites.539 The backfilling requirements did not apply to mines with an insufficient volume of materials remaining to completely backfill the open-pit excavation to the surface.540 In addition, the regulations did not apply to those surface mining operations for which the lead agency had issued a final approval of a reclamation plan and financial assurances prior to December 18, 2002.541
The emergency regulations were set to expire on April 17, 2003, 120 days after their entry into force.542 They were re-adopted by the SMGB and re-filed on April 15, 2003, to last another 120 days to August 13, 2003.543 The SMGB filed the final, permanent regulations on April 18, 2003 and, on May 30, 2003, they were approved by the Office of Administrative Law and took effect.544 This followed a comment period in which the SMGB received more than 2,500 comments supporting the regulations, and four in opposition.545

E. Notice of Arbitration

Following and in response to the federal and state actions detailed above, Claimant filed its Notice of Intent to Submit a Claim to Arbitration under Chapter 11 of the NAFTA on July 21, 2003.546 On December 9, 2003, Claimant filed its Notice of Arbitration, asserting that:

Through the measures identified above, the United States has denied Glamis Imperial the minimum standard of treatment under international law (including full protection and security and fair and equitable treatment of its investment) guaranteed by Article 1105 and has expropriated Glamis Imperial’s valuable mining property interests without providing prompt and effective compensation as guaranteed by Article 1110.547


A. The Request for Arbitration

This Arbitration was commenced by Notice of Arbitration, issued by Claimant, Glamis Gold, Ltd., on December 9, 2003, and served on Respondent, the United States of America, pursuant to Article 3 of the United Nations Commission on International Trade Law ("UNCITRAL") and referencing Articles 1117 and 1120 of the North American Free Trade Agreement ("NAFTA"). The notice detailed various actions taken at the federal and state levels of the United States government that Claimant alleged breached the obligations of the United States under Section A of Chapter 11 of the NAFTA, including: (i) Article 1105 - Minimum Standard of Treatment; and (ii) Article 1110 — Expropriation and Compensation.
In an Agreement of Certain Procedural Matters executed between the Parties on January 20, 2004, the Parties agreed that the place of Arbitration would be Washington, D.C., that the language of the Arbitration would be English, that "[c]ompensation for the arbitration tribunal [would] be at the rates specified in the International Centre for Settlement of Investment Disputes (ICSID) Schedule of Fees, and administered as provided in ICSID’s Administrative and Financial Regulation 14," (a modification of Article 39 of the UNCITRAL Arbitration Rules), and that ICSID would administer the Arbitration.

B. The Appointment of Arbitrators

Pursuant to Article 1123 of the NAFTA, the Tribunal was comprised of three individuals, with one arbitrator appointed by each of the disputing parties and the third, the presiding arbitrator, appointed by agreement of the disputing parties. Each Party appointed an arbitrator: Mr. Donald L. Morgan, Esq. by Claimant, and Professor David D. Caron, by Respondent. President Michael K. Young was appointed as presiding arbitrator by the agreement of the two Parties on November 12, 2004. Mr. Morgan resigned his post without prejudice on November 28, 2005.548 Claimant subsequently appointed Mr. Kenneth D. Hubbard, Esq. to the Tribunal on December 14, 2005. On January 3, 2006, Respondent accepted Mr. Hubbard’s appointment.

C. First Procedural Meeting

On February 25, 2005, the first procedural meeting was held before the Tribunal in Washington, D.C. At this first meeting, the Parties agreed, among other points, that:

a. the arbitral Tribunal was established without objection;

b. the president of the Tribunal could employ a legal assistant to aid the Tribunal in its work;

c. a verbatim transcript of all subsequent hearings and oral arguments would be produced and made available to the Parties and the Tribunal and such transcripts would be produced using Live Notes or some other simultaneous transcription procedure;

d. the hearings might be made available for public viewing via closed circuit television broadcast into some room other than the room in which the hearings are held (subject to confidentiality considerations); and

e. documents on which a Party relied would be submitted with the Party’s respective Memorial or Counter-Memorial, and all such documents would be submitted in complete form and numbered consecutively, starting from the last number of the previous submission, if any.

At this meeting, the Tribunal ordered Respondent to submit its Statement of Defense by April 8, 2005.
In addition to these matters, Ms. Eloise Obadia, ICSID, was introduced as the Secretary to the Tribunal. After this point and until the appointment of the Legal Assistant to the Tribunal, all communications between the Tribunal and the Parties took place through Ms. Obadia.
These agreements and orders were memorialized in Procedural Order No. 1, issued by the Tribunal on March 3, 2005. In this order, the Tribunal also established two separate schedules of the proceedings in the event that Respondent did request a bifurcation of the proceedings based upon pleas as to jurisdiction or preliminary objections, and in the event that it did not. The Tribunal stated that it would establish the exact dates of the final arbitral hearing as soon as practicable and, at an appropriate time, would establish the time limits for the various stages of the hearing. Finally, the Tribunal promised to decide on any issues regarding bifurcation expeditiously and notify the Parties of any changes to the schedule of proceedings.
With respect to document requests and objections to such requests, the Tribunal, in Procedural Order No. 1, directed the Parties to serve their requests for documents ("requests") to each other on May 10, 2005, and any objections to such requests for documents ("objections") on May 24, 2005.549 The Tribunal promised to rule on any objections expeditiously and schedule a hearing on such objections if necessary. In addition, the Tribunal explained that the Parties would have the opportunity to request additional documents for good cause shown after the Memorial and Counter-Memorial had been filed. This opportunity was intended to allow the Parties to address new areas raised by the other Party’s filings; the scope of the opportunity therefore was to be correspondingly limited. Any such request was to be made within one week of receipt of such Memorials or Counter-Memorials.

D. Respondent’s Statement of Defense

In accordance with Procedural Order No. 1, and Articles 19 and 21(3) of the UNCITRAL Arbitration Rules, Respondent United States of America submitted its Statement of Defense on April 8, 2005. In this statement, Respondent highlighted the regulatory context for mining on federal lands and described the Glamis Gold Imperial Project. Respondent also set forth the reasons why the Tribunal allegedly lacked jurisdiction over Claimant’s 1105(1) claims with respect to certain U.S. federal measures and over the entirety of Claimant’s NAFTA Article 1110 expropriation claim with respect to California state measures. In addition, Respondent established its merits defenses and argued that Claimant’s losses were without support. Finally, Respondent presented its prayer for relief.

E. Request for Bifurcation

Also on April 8, 2005, Respondent submitted its Request for Bifurcation in accordance with Procedural Order No.I. In this request, Respondent advanced two preliminary objections to the jurisdiction of the Tribunal: (1) that Claimant’s claims under NAFTA Article 1105(1), based upon three federal actions taking place in October 1999, December 1999 and November 2000, were time-barred under the limitation set forth in NAFTA Article 1117(2); and (2) that Claimant’s claims under NAFTA Article 1110 were not ripe because Claimant could not assert that it "ha[d] incurred" a loss as a result of California state measures as required by NAFTA Article 1117(1). Claimant timely submitted its Response to Request for Bifurcation of United States on April 21, 2005, arguing that bifurcation would result in unwarranted delay as Claimant’s claims arose from a common set of facts that eventually would need to be addressed at a merits phase. In Claimant’s view, the Tribunal would have to perform "the same comprehensive review of the federal and state mining approval process that [would] decide the merits of this dispute."550 Respondent was given the opportunity for further reply and Claimant was permitted a final rejoinder; both were timely filed in accordance with Procedural Order No. 1.
On May 31, 2005, the Tribunal issued Procedural Order No. 2 addressing Respondent’s request for bifurcation. In Procedural Order No. 2, the Tribunal held that the applicable procedural rules were the UNCITRAL Arbitration Rules. Specifically, Article 21(4) of the UNCITRAL Arbitration Rules provides: "In general, the arbitral tribunal should rule on a plea concerning its jurisdiction as a preliminary question. However, the arbitral tribunal may proceed with the arbitration and rule on such a plea in their final award." Article 21(4), the Tribunal found, establishes a presumption in favor of the tribunal preliminarily considering objections to jurisdiction. Simultaneously, however, Article 21(4) does not require that pleas as to jurisdiction be ruled on as preliminary questions. The choice not to do so is therefore left to the Tribunal’s discretion.
After evaluation of these numerous considerations, the Tribunal explained that it was "not persuaded that the proceedings should be bifurcated, at this time. To do so would not ultimately avoid expense for the Parties, contribute to Tribunal efficiency, or be practical."
Specifically, with respect to Respondent’s argument that Claimant’s claims based under NAFTA Article 1105(1) predicated upon three federal actions were time barred, the Tribunal wrote:

21. The Tribunal notes that even if it were to find the three mentioned federal actions to be time barred, such a finding does not eliminate the Article 1105 claim inasmuch as other federal actions are alleged by Claimant to be a basis for its claim. The potential exclusion of certain events at the merits stage to serve as independent bases of the claim will not in the circumstances of this proceeding exclude the claim in its entirety. Inasmuch as there is no jurisdictional objection to the NAFTA Article 1105 claim as based on the Record of Decision and subsequent acts, the Tribunal does not find the request for preliminary consideration of the objection to the Article 1105 to be justified in that even if the Tribunal were to grant respondent’s objection, the cost and time of that proceeding would not be justified in terms of the reduction in costs at the subsequent phase of these proceedings.

With respect to Respondent’s assertion that Claimant’s claims under NAFTA Article 1110 were not ripe, the Tribunal held:

25. Considering Respondent’s request for bifurcation and preliminary consideration of the 1117(1) under Article 15(1), the Tribunal does not find the request justified and therefore denies Respondent’s request. In particular, the Tribunal finds that if it were to bifurcate its consideration of the issue identified, the Tribunal would be immediately confronted with the issue of whether California’s laws and policies resulted in an expropriation under Chapter 11 of NAFTA. Since the facts presented to answer the Article 1117(1) issue are likely to be the same facts presented on the expropriation issue, the Tribunal finds the proposed bifurcation to be impractical in that the Article 1117(1) issue identified is so intertwined with the merits that it is very unlikely that there will be any savings in time or cost. The question, therefore, of identifying ‘the point when the damage was sufficiently concrete and permanent to result in breaches’ is to be considered as a part of the merits.551

F. Document Production

In accordance with the schedule of proceedings outlined in Procedural Order No. 1, the Parties timely filed their requests for documents on May 10, 2005, and objections to such requests for documents on June 7, 2005.552
The Tribunal found, in reviewing the objections, that they were stated in general terms and it was thus unclear to the Tribunal whether they represented production concerns to particular documents with respect to which the Parties were seeking further guidance from the Tribunal in the form of a ruling.553 The Tribunal therefore issued Procedural Order No. 3 on June 21, 2005, in which it requested that, where there were particular objections regarding which a Party sought a Tribunal ruling, the Party should request such a ruling providing "as a part of that request specificity as to the grounds for upholding or overturning a given request or objection for a category of documents or a particular document." The Party not requesting review was then given the opportunity to file a reply to each request.
After the receipt of the objections and replies, it was the intent of the Tribunal to rule upon any such specified request expeditiously and, if at all possible, on the basis of the papers filed with the Tribunal. Recognizing, however, that the consequences of the objections for the production of documents might not be apparent until after the final scheduled date for exchange of documents, the Tribunal also reserved August 19, 2005 for a hearing on such objections.554
Following Procedural Order No. 3, both Parties expressed interest in receiving further guidance from the Tribunal with respect to their objections, and timely submitted requests for such guidance on June 30, 2005 and replies to these requests on July 7, 2005.555

1. Decision on Objections to Document Production

In response to these Party inquiries, the Tribunal issued its Decision on Objections to Document Production ("Decision on Objections") on July 20, 2005.
In the Decision on Objections, the Tribunal first sought to identify and analyze the applicable law. It wrote:

7. This arbitration is conducted under the UNCITRAL Arbitration Rules.

8. The UNCITRAL Rules in Article 24 provide:

1. Each party shall have the burden of proving the facts relied on to support his claim or defence.

2. The arbitral tribunal may, if it considers it appropriate, require a party to deliver to the tribunal and to the other party, within such a period of time as the arbitral tribunal shall decide, a summary of the documents and other evidence which that party intends to present in support of the facts in issue set out in his statement of claim or statement of defence.

3. At any time during the arbitral proceedings the arbitral tribunal may require the parties to produce documents, exhibits or other evidence within such a period of time as the tribunal shall determine.

Article 24 is general in its terms, making clear the authority of the Tribunal to order the production of ‘documents, exhibits or other evidence’ but providing only skeletal guidance as to the exercise of that authority. Under Article 15(1) of the Rules, ‘the arbitral tribunal may conduct the arbitration in such manner as it considers appropriate, provided that the parties are treated with equality and that at any stage of the proceedings each party is given a full opportunity of presenting his case.’

9. The International Bar Associations Rules on the Taking of Evidence in International Commercial Arbitration (‘IBA Rules on Evidence’) are not directly applicable to this proceeding. [FN1] As a part of the exercise of its authority under Article 15(1), however, the Tribunal may look to the IBA Rules on Evidence for guidance.

FN1: See tape recording of the February [hearing] beginning at minute 35, second 45 to minute 44.

10. The Tribunal notes in particular the standards for production referenced in the IBA Rules on Evidence. Article 3(a)(ii) emphasizes that requests for documents should be of a ‘narrow and specific’ nature and of documents that ‘are reasonably believed to exist.’ Article 3(b) underscores the need for documents to be ‘relevant and material to the outcome of the case.’ On the basis of this general guidance, the Tribunal has endeavored to ensure that any documents which it compels a Party to produce should be of a ‘narrow and specific’ nature, ‘reasonably believed to exist’, and ‘likely material to the outcome of the case.’

In addition to defining the applicable law, the Tribunal made the following additional general observation regarding the Parties’ requests for rulings:

15. In the interest of avoiding the burdens of litigation and protecting the expectations of the parties in the arbitration process, the Tribunal has endeavored to make its decisions regarding the Parties’ Objections in such a manner as to focus on the articulated materiality of a given document or category of documents. The Tribunal believes that as the document production efforts proceed the Parties will have evaluated the publicly available records and will be in a better position to articulate which additional documents will be necessary for the Parties to prepare their arguments.

Based upon these interpretations of the applicable law and the Tribunal’s general observations, the Tribunal held as follows with respect to the Parties’ requests for specific categories of documents:

a. The Tribunal denied without prejudice Claimant’s request for the following non-public documents relating to communications between the DOI and the Indian tribes; the creation and management of the Indian Pass Area of Critical Environmental Concern; the October 27, 1998 proposal to withdraw DOI lands encompassing the Imperial Project; and the October 27, 2000 withdrawal of DOI lands.556 The Tribunal believed the production of nonpublic documents was premature before Claimant had reviewed the available public documents. If, however, after the review of public documents made available by Respondent, Claimant had reason to believe that specific nonpublic documents were likely to be material, the Tribunal indicated its willingness to review renewed requests.557

b. The Tribunal denied without prejudice Claimant’s request for documents from a specified list of federal and state government offices that Claimant argued would have been active in "deciding or guiding the fate of the Imperial Project."558 The Tribunal noted the overlap of this request with Claimant’s Categories 1 and 7 requests (the latter of which Respondent was currently producing) and viewed the Category 8 request as encompassed within the production effort for Categories 1 and 7. Again, should Claimant have reason to believe that a particular source named above was not contained in the Categories 1 and 7 production effort and was likely to contain material information, the Tribunal indicated that the Claimant would have the opportunity to renew its request of a search for those particular offices.559

c. The Tribunal denied without prejudice Claimant’s request for documents dating after July 21, 2003. The Tribunal concluded that these documents were, at a minimum, premature as the public record had not yet been reviewed. The Tribunal also was not disposed at that time to regard the requested documents as material. Therefore, the Tribunal explained, any renewal request should articulate as fully as possible the likely materiality of the documents requested.560

d. The Tribunal denied without prejudice Respondent’s request that the Tribunal issue an order requiring Claimant to produce documents, wherever located, concerning complete backfilling as "contemplated, proposed or adopted by governments in foreign countries... including Mexico, Guatemala, and Honduras."561 Claimant stated it had no knowledge of "complete backfilling" requirements outside of the United States. Given this stated lack of knowledge, the Tribunal explained that such a geographically broad order would require "a more substantial nexus to be articulated between the category of requested documents and the likely materiality of such documents to the outcome of the case." The Tribunal denied with leave to renew if Respondent identified more specifically the likely material documents which should be in Claimant’s possession.562

e. Finally, the Tribunal denied without prejudice Respondent’s request that the Tribunal require Claimant to release documents concerning "the consideration, approval or review by Glamis’ board of directors or committees of the board of directors of expenditures on any expansions of existing projects or any new gold mining projects, other than the Imperial Project."563 Although the Tribunal had some appreciation that this information could assist Respondent in evaluating Claimant’s investment expectations, it was not satisfied that the proposed discovery would be in practice transferable to the evaluation of the Imperial Project. In any renewal of this request, the Tribunal thus indicated that Respondent should "articulate as fully as possible the likely materiality of the documents requested, including the methodology by which a comparative analysis [would] be made."564

Following the Decision on Objections, the Parties produced numerous privilege logs to each other cataloguing the documents that they were withholding and describing the privileges that they asserted as protecting these documents. Claimant produced its first privilege log on August 3, 2005, and Respondent’s first logs were received on August 16, 2005. Numerous amended and supplemental privilege logs and further explanation of logged documents followed the exchange of these initial logs until their completion in March of 2006.
Although the Decision on Objections extended the time to identify Objections until August 23, 2005, the Parties requested further time and postponement of the scheduled hearing by a joint letter on August 19, 2005. On August 26, 2005, in Procedural Order No. 4, the Tribunal granted an extension until September 15, 2005 for the identification of objections, and set the hearing on any unresolved document production issues for October 3, 2005, in Washington, D.C.
The deadline for the submission of objections was again extended in Procedural Order No. 5, issued retroactively by the Tribunal on September 19, 2005. The Tribunal granted a one-day extension, per Claimant’s request. In addition, in light of the receipt of Claimant’s Request for Production of Documents Withheld by Respondent and the accompanying 35-page legal memorandum on September 16, 2005, the Tribunal granted Respondent until September 29, 2005, to file a memorandum in opposition to Claimant’s submission. The Parties timely filed these submissions.
On October 3, 2005, a hearing was conducted before the Tribunal in Washington, D.C., at which the Parties presented their views on their requests for production of documents and the withholding of documents by each Party on the grounds of privilege or materiality. At this time, each Party explained its objections to the withholding of categories of documents claimed by the other party to be privileged, and provided legal and factual support for its own documents withheld from production.
At the hearing, both Parties additionally informed the Tribunal that certain aspects of the Arbitration were requiring greater time than previously expected and that this was making the current schedule untenable. Principally, the Parties expressed concern that the great quantity of documents produced by both Parties, and the process of reviewing these documents and objecting to documents that were being withheld, was requiring significantly more time than expected. Because of these delays, both Parties expressed interest in postponing certain deadlines in the schedule, though Claimant wished not to move the date of the final arbitral hearing.
In addition to these discussions at the hearing of October 3, the Tribunal presented to the Parties the recently appointed Assistant to the Tribunal, as authorized at the first procedural hearing and memorialized in Procedural Order No. 1. The Tribunal introduced Ms. Leah D. Harhay, who was present at the hearing and presented her résumé to the Parties.
In response to the concerns regarding the arbitral schedule raised by the Parties at the hearing of October 3, the Tribunal issued Procedural Order No. 6 on October 15, 2005. This order set a deadline of February 16, 2006 for the submission of Claimant’s Memorial; June 22, 2006 for Respondent’s Counter-Memorial; August 31, 2006 for Claimant’s Reply; and October 12, 2006 for Respondent’s Rejoinder. In addition, the order set December 4 to 8, 2006 for the arbitral hearing, with a possible continuation of the hearing scheduled for December 11 to 15, 2006.
On October 21, 2005, Respondent requested an additional three weeks to prepare and file its Rejoinder, to enable it to process the unexpectedly large quantity of documentary evidence involved in the proceeding and to provide it with a preparatory time period similar to that afforded Claimant. Claimant objected to the request on the grounds that such an extension would leave it insufficient time to address Article 1128 and non-disputing party submissions in its Reply and would place the submission of Respondent’s Rejoinder only one month prior to the arbitral hearing.
Desiring not to delay the date of the December 2006 hearing, but cognizant of the needs of both Parties to address the large body of documentary evidence and to have adequate time to respond to each other and to non-disputing parties, the Tribunal amended the schedule of proceedings in Procedural Order No. 7, issued on November 10, 2005. In particular, it extended the deadline for the submission of Claimant’s Reply to September 7, 2006, and Respondent’s Rejoinder to October 26, 2006. The pre-hearing procedural hearing was moved one week to November 9, 2006, but the schedule of proceedings as outlined in Procedural Order No. 6 was otherwise left unchanged.

2. Decision on Parties’ Requests for Production of Documents Withheld on Grounds of Privilege

In response to the issues raised and discussed at the hearing of October 3, and in an attempt to outline a process by which the claims and objections to privilege assertions could be assessed first by the Parties and then by the Tribunal, the Tribunal issued its Decision on Parties’ Requests for Production of Documents Withheld on Grounds of Privilege on November 17, 2005 ("November 17 Decision"). In this decision, the Tribunal defined the scope of the various privileges claimed by the Parties and outlined procedures for objections to be evaluated and submitted to the Tribunal. To begin, however, the November 17 Decision explained the law applicable to this Arbitration with respect to procedures for making determinations on claims of privilege. The Tribunal first explained that the Arbitration is conducted under the UNCITRAL Arbitration Rules and cited Article 24 of the UNCITRAL Arbitration Rules,565 but then explained that:

17.... Article 24 makes clear the authority of the Tribunal to order the production of ‘documents, exhibits or other evidence’, but provides little guidance as to the exercise of that authority. The UNCITRAL rules are silent on the subject of the assertion of claimed privileges and provide no explicit guidance as to the Tribunal’s ruling on such claims. It is only stated under Article 15(1) of the Rules that ‘the arbitral tribunal may conduct the arbitration in such manner as it considers appropriate, provided that the parties are treated with equality and that at any stage of the proceedings each party is given a full opportunity of presenting his case.’

Given not only the discretion afforded the Tribunal by the UNCITRAL rules with respect to assessing claimed privileges, but also the general lack of guidance on the subject by the rules, the Tribunal went on to explore and identify the laws and practices that could be used as guidance in its crafting of standards for each privilege. These standards were then intended for employment by the Parties in evaluating their claimed privileges and assessing their objections to the opposing Party’s claimed privileges.

18. In their submissions on document production issues, both Parties cited the rules of the International Bar Association as a source of guidance for the Tribunal on production of documents. The Tribunal observes that those rules provide that documents requested should be ‘material’ to the proceeding. The Tribunal in its previous decisions has adopted the requirement of materiality.

19. The Tribunal recognizes that, in international arbitration, procedural matters such as the applicability of privileges and the form of objections to such assertions can be set out by the agreement of the Parties. The Parties in their submissions, and at the hearing, appear to agree that the privilege law of the United States should be looked to by the Tribunal for guidance as to the law of privilege to be applied in this arbitration. The Parties, however, disagree as to which jurisdiction of the United States reference should be made. Claimant points to the law of the D.C. Circuit or federal common law which it views as most reflecting the expectations of the Parties, while Respondent favors those principles that are common among the jurisdictions, noting that Claimant could have as easily filed a suit in the courts of the State of California, or in the Federal Court in Nevada.

20. The Tribunal observes that the law of the United States, both as to production of documents or to the privilege enjoyed by some set of documents, is not directly applicable to this arbitration. Rather document production in this arbitration is governed by Article 24 of the UNCITRAL Arbitration Rules and guided by the Parties’ own agreements to production as evidenced in their February 24, 2005 letters. Moreover, the Tribunal observes that it is unlikely in any event that the expectations of the United States as a party to the NAFTA as to privileges that it might enjoy in the NAFTA chapter 11 arbitrations would vary proceeding to proceeding depending on the jurisdictions in which a particular claimant might field an action. Thus the Tribunal has reviewed the case law of numerous United States jurisdictions—including California and the District of Columbia, neither of which were found to be outliers—and attempted to identify general consensus between courts that might be helpful in defining what the Parties would reasonably expect to apply in this situation. The Tribunal then used this information, combined with its knowledge of and appreciation for the differences between court proceedings and international arbitration [FN1], to craft standards that can assist the Parties in assessing their claims of privilege and their objections to such claims.

FN1. With respect to the differences between domestic litigation and international arbitration, the Tribunal recognizes that it is generally understood that one reason parties choose arbitration is to avoid the relatively extensive document production practices of courts generally and United States courts in particular. It feels that this expectation is not generally different in the context of NAFTA Chapter 11 arbitration, although the Tribunal notes that the investment arbitration context in which there may not be a contractual relationship between the parties does distinguish such proceedings from international commercial arbitration and thus militates in favor of some greater receptiveness on the part of the Tribunal for document production requests.

The Tribunal then explored each claimed privilege and, for each, defined the privilege’s scope and applicability, as well as outlined procedures by which the Parties were to explain their assertions of this privilege and challenge those of the other Party.
With respect to documents withheld by Respondent on grounds of the attorney-client privilege, about which there were numerous questions by the Parties regarding the application of the privilege to government attorneys, the Tribunal wrote:

23. The Tribunal notes that the party asserting the privilege has the burden of proving that such privilege applies to each document [FN7] but, after that showing is made, the burden shifts to the other party to contest the privilege. The Tribunal recognizes that, when asserting this privilege, it is important to make clear that the attorney is indeed acting as such and providing legal advice, and is not acting as a policy-maker or corporate officer. [FN8] Therefore, it is critical that, when invoking the privilege, the invoking party explain with sufficient specificity the role the attorney is taking.

FN7. See Coastal States Gas Corp. v. Dep’t of Energy, 617 F.2d 845, 861 (D.C. Cir. 1980); Cobell v. Norton, 212 F.R.D. 24, 27 (D.D.C. 2002).

FN8. See Burlington Indus, v. Exxon Corp., 65 F.R.D. 26 (D. Md. 1974); Coastal Corp. v. Duncan, 86 F.R.D. 514, 521 (D.Del. 1980).

24. With respect to government attorneys, the Tribunal finds a general consensus among courts that the attorney-client privilege applies equally to government agencies: ‘In the governmental context, the ‘client’ may be the agency and the attorney may be an agency lawyer.’ [FN9] The Tribunal finds the application of this consensus rule is appropriate to this Arbitration. Furthermore, the Tribunal recognizes that an important prerequisite to assertion of the attorney-client privilege is the confidentiality of the information. The Tribunal understands, however, that in the government context, where the client is by nature a group, the privilege is not defeated by circulation beyond the attorney and the person within the group requesting or providing the information. [FN10] Communications between different government agencies should remain privileged to the extent that there is a ‘substantial identity of legal interests’ within the different agencies in the particular subject matter of the communications. [FN11]

FN9. Tax Analysts v. I.R.S., 117 F.3d 607, 618 (D.C. Cir. 1997).

FN10. Coastal States, supra, at 863.

FN11. U.S. v. American Tel. & Tel. Co., 86 F.R.D. 603, 616-17 (D.D.C. 1979).

The Tribunal then outlined procedures for the Parties to utilize with respect to documents withheld on the grounds of the attorney-client privilege to which they object. First, Claimant was requested to list its objections to Respondent’s assertions of the attorney-client privilege, specifically explaining why it believed the privilege did not apply. Claimant was to base these objections on Respondent’s privilege logs and request more detail when it felt those logs provided insufficient explanation. In response to such a request, Respondent was to provide a more detailed explanation of the basis in the document for the assertion of the privilege and, if applicable, the basis for an objection as to the materiality of the document requested. The Tribunal foresaw that the following completed statement in a privilege log, absent extraordinary circumstances, usually would suffice to assert the privilege:

Confidential _ (Communication/Email/Memo/etc.) dated _ between Attomey/Attomey’s Representative_, who was at the time acting as legal counsel and not primarily as a policymaker or corporate decision-maker, and Client/Client Affiliate_concerning legal advice on the subject of_,566

Depending on the objection raised by the Claimant, the Respondent also may have been required to state that:

To the extent that this document was circulated to_, (a colleague from a different agency), such circulation is protected because there was substantial identity of legal interests between the two agencies with respect to the particular subject matter of the communication.567

Should this explanation fail to satisfy Claimant, it was to respond with a detailed explanation as to why it believed this assertion was incorrect or why it failed based on the standards listed above. Finally, should these objections not serve to compel production of the disputed documents, and further discussions with Respondent did not resolve the matter, the Tribunal explained that it would, if requested by January 3, 2006, decide upon such objections on a document-by-document basis.568

With respect to documents withheld by Claimant on grounds of the attorney-client and work product privileges, the Tribunal noted that Respondent’s concerns centered on the multiple roles played by Mr. Charles A. Jeannes as Glamis’s executive vice president, administration, general counsel and secretary. The Tribunal recognized that, as discussed above, in asserting the attorney-client privilege, it is critical that the attorney involved in the production of the document in question is acting as an attorney. The same applies for assertions of the work product privilege.569 As the objections to these documents were relatively clear, the Tribunal requested Claimant to issue an amended privilege log with these documents. Using the statement provided in the previous section, or something similar, Claimant was to explain the role that Mr. Jeannes was filling with respect to each document. Should this explanation not satisfy Respondent, Respondent was to respond with a detailed explanation as to why it believed the assertion was incorrect or failed based on the standards listed above. If the Parties were unable to come to a resolution, the Tribunal explained again that it would decide on the objections on a document-by-document basis.
With respect to documents withheld by Respondent on the grounds of work product privilege, the Tribunal noted that the core of Claimant’s objections to Respondent’s claims of work product privilege was that the documents were not created "in anticipation of litigation or for trial." In addition, Claimant argued that the privilege, even where successfully asserted, is qualified, and assertions based on documents that were neither litigation strategy nor attorneys’ mental impressions about litigation preparation activities could be outweighed by a showing of "substantial need and inability to obtain the equivalent without undue hardship."570 The Tribunal therefore first sought to set forth a definition of the "in anticipation of litigation or for trial" standard and identify the threshold necessary to override a claim of privilege.

31. Most courts recognize that the test for when a document is prepared ‘in anticipation of litigation’ [FN2l] turns on the function of the documents rather than merely the timing of their creation. [FN22] Thus, the content of the documents must relate to preparation for litigation; this includes ‘[s]ubject matter that relates to the preparation, strategy, and appraisal of the strengths and weaknesses of an action, or to the activities of the attorneys involved, rather than to the underlying evidence....’ [FN23] Based on this understanding of the subject matter, work product usually encompasses ‘interviews, statements, memoranda, correspondence, [and] briefs’ of lawyers. [FN24] With these themes within domestic case law in mind and recognizing how litigious society currently is and that there is therefore often the possibility that many actions could lead to litigation, the Tribunal observes that it is important, when claiming the work product privilege, that the withholding Party explain how the subject matter of the document relates to a likely lawsuit by an identifiable adversary in respect of a specific dispute.

FN21. See Hickman, supra at 511-12; see also Fed.Rule.Civ.Proc. 26(b)(3).

FN22. See Delaney, Migdail & Young, Chartered v. I.R.S., 826 F.2d 124, 127 (D.C. Cir. 1987).

FN23. In re Air Crash Disaster at Sioux City, 133 F.R.D. 515, 519 (D. III. 1990) quoting 4 Moore’s Federal Practice, para. 26.64[l] at 26-349- 350 (1980).

FN24. Heger, supra at 76, citing Hickman, supra at 393-94.

32. With respect to the Parties’ arguments regarding the threshold of need and unavailability that must be crossed in order to override a claim of work product privilege, the Tribunal observes that the Parties are actually not wholly in disagreement. Both Parties recognize that there is ‘core’ work product, including litigation strategies and attorney mental impressions, among other things, that will not be released without a showing of extraordinary justification. The Parties appear to disagree therefore only on documents, or portions of documents, that do not constitute ‘core’ work product. The Tribunal holds that, with respect to documents not rising to the level of attorney personal thought and strategy, the privilege is qualified and can be overruled by a sufficient showing of need and unavailability and a weighing of the importance of the claimed privilege versus the importance of production, (internal citations omitted)

The procedures outlined for the resolution of disputes regarding Respondent’s assertions of the work product privilege closely follow those for disputing Respondent’s assertion of the attorney-client privilege. First, Claimant was to list its objections on a document-by-document basis, or request further explanation, where necessary. Respondent was then to respond with a more detailed explanation of the basis in the document for the assertion of privilege and, if applicable, the basis for an objection as to the materiality of the document requested. In particular, the Tribunal foresaw that the following completed statement in a privilege log, absent extraordinary circumstances, usually would suffice to assert the privilege:

This _ (Document/Draft/Report/etc.), dated _, was prepared by Attomey/Attomey’s Representative_because of anticipated litigation and would not have been prepared in substantially the same form in the absence of such anticipated litigation.571

The Tribunal additionally noted that it would be important for the withholding Party to note whether the document itself identified a specific pending or potential dispute or litigation and/or identified the likely adverse party or parties. Finally, the withholding Party was to specify whether factual information that could be segregated had been so removed and produced. Should these explanations not satisfy Claimant, it was to respond with a detailed explanation as to either: (i) why it believed this assertion was incorrect or failed based on the standards listed above; or (ii) why it believed that its need was so great and the document so unavailable that the document must be produced regardless of the assertion of the privilege. With respect to the latter argument, Claimant also was requested to explain how the document was likely to provide material evidence to support a factual contention, which the Tribunal might otherwise conclude lacked clearly probative support. Finally, should the Parties be unable to come to resolution on the disputed documents, they were requested to submit their objections to the Tribunal for review, as discussed above.

Finally, with respect to documents withheld by Respondent on grounds of the deliberative process privilege, the Tribunal noted that the Parties did not disagree with the general definition of the privilege as "exempt[ing] from disclosure ‘opinions, recommendations or advice offered in the course of the executive’s decision making processes,’"572 or the requirement that the documents be both pre-decisional and deliberative. Claimant, however, argued that a significant burden had to be met to prove the privilege, that the privilege is qualified and that all factual information must be segregated. The Tribunal therefore clarified the scope of the privilege and the burden necessary to claim it. In its November 17 Decision, the Tribunal wrote:

36. As the Parties do not disagree on the general definition of the scope of the privilege or the requirement that documents withheld under it be both pre-decisional and deliberative, the Tribunal adopts these interpretations. To elaborate on these definitions, and possibly to clear any disagreements between the parties, the Tribunal finds that the privilege shall encompass documents generated before the adoption of an agency policy or decision that contain opinions, recommendations or analyses of specific policies or decisions. [FN37] The Tribunal agrees that factual information should generally be segregated and produced, [FN38] but also recognizes that there may be situations in which the factual information is either so inextricably intertwined with policy information that it cannot be appropriately segregated or the factual information itself would reveal too much of the deliberative process to be disclosed. The opposite situation could also occur where deliberative materials are so benign as to reveal nothing of the deliberative process and should be produced. [FN39] As there is thus no black line on which to require production, the Parties and the Tribunal must evaluate the assertions of the officials who request the privilege.

FN37. See FTC v. Warner Communications, supra at 1161, citing Coastal States, supra at 866.

FN38. Id.

FN39. See Mead Data Central, Inc. v. United States Dep’t of the Air Force, 533 F.2d 242, 257 (D.C. Cir. 1977).

37. With respect to the burden of assertion and the formal requirements cited by Claimant for proper assertion, the Tribunal recognizes a general consensus in the case law that the head of the agency controlling the information must assert the privilege after review and analysis of the document. [FN4O] Recognizing the conflicting goals of this burden—that a sufficiently senior official perform the analysis and weighing of the assertion of the privilege, but that such official must devote substantial time and effort to gain personal knowledge of each document—and given that the formalities of U.S. practice are neither directly applicable or necessarily appropriate to arbitration, the Tribunal, absent extraordinary circumstances, will accept an assertion of the privilege from an official, at the assistant secretary or deputy secretary level, controlling the information if he/she is equally or more familiar with the information, rather than an agency head.

FN40. See Branch v. Phillips Petroleum Company v. E.E.O.C., 638 F.2d 873, 882 (5th Cir. 1981); see also Walker v. NCNB National Bank of Florida, 810 F.Supp. 11, 13 (D.D.C. 1993).

With these principles in mind, the Tribunal established a procedure identical to that proposed above. With respect to the detailed explanation of the basis in the document necessary for the assertion of the deliberative process privilege, the Tribunal foresaw that the following completed statement in a privilege log, absent extraordinary circumstances, usually would suffice to assert the privilege:

The document, dated_, was prepared in order to assist an agency decisionmaker, _ (name), _ (position) in arriving at a _ (a specific decision)."573

The certifying official also was to state that: (i) the basis of assertion of the privilege had not been incorporated into a final agency decision, and (ii) he/she believed, in good faith, that the harm of disclosure would overcome the value of production of the document to Arbitration. Finally, Respondent was to specify if factual information that could be segregated had been so removed and produced.

Included with the procedures outlined in the November 17 Decision was a timetable specifying the dates upon which each of the procedures was to be completed. This timetable was intentionally drawn up with short time periods so as to preserve the possibility of the Tribunal holding a hearing in this matter before the end of 2006. Although both Parties worked in good faith to meet the Tribunal’s deadlines, they had difficulty in meeting this aggressive timetable. In an effort to satisfy the requirements and deadlines outlined by the Tribunal in its November 17 Decision, the Parties provided each other and the Tribunal with numerous amended privilege logs, clarifications of objections to claims of privilege, and further explanation in support of assertions of privilege, during the period of December 1, 2005 to January 26, 2006.
On January 31, 2006, the Tribunal issued Procedural Order No. 8, outlining the steps it considered necessary to complete this process of asserting and challenging claims of privilege. The Tribunal viewed "the next - and hopefully final - step in the production process as being its examination of the validity of claims of privilege on a document-by-document basis, as informed by the privilege logs submitted by the withholding party and the challenges raised by the requesting party." The Tribunal explained that, if its review of the privilege logs and corresponding challenges was insufficient to enable it to adequately determine the validity of all assertions of privilege, it would return to the Parties to discuss the process to be taken to complete this determination, including the possibility of the confidential review of individual documents by an independent special master. Finally, "[d]ue to the extensive nature of this document production process and the desire to have evidence available to the Parties prior to their memorial submissions," the Tribunal found the present arbitral schedule unsustainable and thus provided an amended arbitral schedule. In the amended schedule, the arbitral hearing was planned for March 26 to 30, 2007, with a possible extension to April 2 to 6, 2007, and interim submission dates also were adjusted.

3. Decision on Requests for Production of Documents and Challenges to Assertions of Privilege

In accordance with Procedural Order No. 8, the Parties renewed their challenges to the documents remaining in dispute and submitted final arguments on March 1, 2006. Respondent renewed its challenges to six withheld documents, and Claimant continued to challenge the withholding of 159 documents.
Based on the descriptions provided in the Parties’ privilege logs and supporting affidavits, and in the challenges, the Tribunal considered each request for production. On April 21, 2006, the Tribunal issued its Decision on Requests for Production of Documents and Challenges to Assertions of Privilege ("April 21 Decision") in which it decided on each request or, in some instances where a request required the weighing of the Parties’ interests, deferred decision.
Prior to issuing its decisions with respect to each category of documents requested, the Tribunal made special note of the documents upon which it had deferred decision and explained the limits of those deferrals.

8(iii).... [W]here the analysis of an asserted privilege requires the Tribunal to balance Claimant’s need for the documents against Respondent’s interest in maintenance of the privilege, the Tribunal in several instances has deferred that decision until a later date. The Tribunal wishes to be clear as to the limits of these deferrals. In the Tribunal’s view, the phase of this proceeding concerned with party driven requests for production of documents is closed. In deferring any particular decision on such requests, the Tribunal defers its decision only as to the particular document or documents requested. The decision of the Tribunal to defer some decisions until a later time is driven by two factors. The starting point for the Tribunal is that it should not override privileges unnecessarily. Simultaneously, the question of Claimant’s need for a particular document cannot be assessed with accuracy at this early point in the arbitration. This is particularly the case given the fact that Claimant in many instances has other documents, or entirely different means of proof, available to it to establish a proposition. In deferring a decision, the Tribunal anticipates that such decision will not be made until, or following, the hearing on the merits of the claim. The Tribunal acknowledges that any later decision to order production would result in a limited extension of the proceedings.

a. Section A: Decisions with respect to Documents Withheld by the State of California

Claimant’s first category of arguments addressed its demands for documents from the State of California, which it separated into six groups. In Group 1, the Tribunal addressed the request for 10 analyses of Senate Bill 22 that Claimant argued California Government Code § 6254(1) did not absolutely protect and the official information and deliberative process privileges also did not protect, or were overridden by Claimant’s great need for the documents. Although hesitant to delve into analysis of local state law in an international arbitration, the Tribunal recognized that the Parties had urged the Tribunal to look to California law and presented their arguments with reference to that law. The Tribunal therefore inquired into the privilege laws of California, "not because the Tribunal believe[d] it necessarily to be the applicable law, but rather because the Parties direct the Tribunal to it." The Tribunal wrote:

13. After analysis of California Government Code §6254(1) and relevant case law, the Tribunal finds that §6254(1) does not protect the particular documents in question. In a similar situation in which a California agency was not a party to the litigation, but was very involved in the facts of the dispute, a California Court of Appeals held that the information was critical to a party to the litigation and thus §6254(1) did not protect the agency’s records. [FN8] The Tribunal finds that the rights of Claimant (in effect a litigant here) are affected by the documents requested and, in addition, the State of California has been similarly involved intimately in the events that culminated in this dispute. Therefore, the Tribunal finds that the absolute protection of California Government Code §6254(1) does not protect the documents at issue.

FN8. See Marylander v. Superior Court, 81 Cal.App.4th 1119, 1125 (2000).

14. The Tribunal turns then to the other privileges asserted by Respondent over these documents, namely California’s official information privilege and the deliberative process privilege. As the two are similar, the Tribunal thinks it appropriate to apply the principles of the deliberative process privilege to the analysis of both privileges. The Tribunal recognizes that ‘[t]he deliberative process privilege is a qualified one. A litigant may obtain deliberative materials if his or her need for the materials and the need for accurate factfinding override the government’s interest in non-disclosure.’ [FN9] In this situation, although the Tribunal recognizes the assertion of and interests in the deliberative process privilege, it finds the statement of Claimant’s need, particularly given the apparent absence of other documents or other means of proof available to the Claimant, to be sufficiently great to override those interests. Therefore, the Tribunal requests Respondent to produce the ten documents at issue, at its earliest opportunity.

FN9. Federal Trade Commission v. Warner Communications, Inc., 742 F.2d 1156, 1161 (9th Cir. 1984).

Claimant then requested a single document, Government Log No. 105 (Group 2), which it believed was logged in response to a specific document demand. Claimant argued that the attorney-client privilege was waived with respect to this document and all communications on this subject matter between the same parties by an extrajudicial statement regarding the legal conclusion of counsel. The Tribunal wrote:

17. The Tribunal acknowledges Respondent’s assertion that the documentary evidence that Claimant seeks does not in fact exist. Independent of the document’s existence, the Tribunal notes that the attorney-client privilege is an absolute one. Moreover, as regards Claimant’s argument that the privilege was waived, the Tribunal understands that subject matter waiver is intended to prevent a privilege-holder’s selective disclosure of documents during litigation. However, a mere ‘extrajudicial disclosure of an attorney-client communication—one not subsequently used by the client in a judicial proceeding to his adversary’s prejudice—does not waive the privilege as to the undisclosed portions of the communication.’ [FN12] Thus, the Tribunal does not find subject matter waiver in this situation and deems this document protected by the attorney-client privilege.

FN12. In re von Bulow, 828 F.2d 94, 102 (2d Cir. 1987).

With respect to emails among California government attorneys and a facsimile cover memorandum dated December 2, 2002, as requested in Claimant’s demands for Group 3 and Group 4 documents respectively, the Tribunal noted Respondent’s clarification as to the content of the disputed documents, and was not prepared to compel their production. The Tribunal expressed its willingness, however, to consider further arguments from Claimant based on these clarified fact patterns.574
In Group 5, Claimant sought two documents comprising the January 2002 Advisory Memoranda. At paragraph 26, the April 21 Decision explained: "The Tribunal finds that Respondent has stated sufficient facts to establish that the attorney-client privilege protects both documents, at which point the burden shifts to the Claimant to assert that the privilege does not in fact apply. The Tribunal determines that this burden has not been met and the documents are thus deemed protected."
Finally, in Group 6, Claimant demanded three documents relating to a proposed gubernatorial proclamation and six documents relating to the governor’s public outreach strategies. With respect to the first three documents, the Tribunal held that the attorney-client privilege did provide absolute protection. With respect to the latter six documents, the Tribunal wrote:

30.... [T]he Tribunal recognizes the qualified nature of the deliberative process privilege and that the interests in protection can be outweighed by a sufficient statement of need from the challenger. The Tribunal views Claimant’s argument that a challenge to the integrity of the decision-making process vitiates any assertions of the deliberative process privilege as an extreme variation of the generally applicable analysis of whether need outweighs interest in protection. The question of Claimant’s need, however, cannot be decided at this early point in the arbitration. The Tribunal therefore cannot compel production of these documents at this time, a holding that is demanded by the fact that the Tribunal does not override privilege unnecessarily and will not order production without restriction. If, at the point at which the Tribunal begins to make determinations on the merits of the claims, however, it becomes apparent that a particular decision is essential to such determinations and other documents, witnesses or evidence lead the Tribunal to believe that the documents currently requested may assist the Tribunal in such a decision, the Tribunal will revisit the requests for production of these particular documents.

b. Section B: Decisions with respect to Documents Withheld by the Advisory Council on Historic Preservation575

Issue 1: In response to Claimant’s argument that none of the 54 documents in this section is protected by the deliberative process privilege because the integrity of the deliberative process was at issue, the Tribunal again deferred its decision as explained above in the quoted paragraph 30. In addition to the above paragraph, the Tribunal wrote: "Specifically, the Tribunal is not persuaded by Mr. Stanfill’s statement alone that the ACHP’s [Advisory Council on Historic Preservation] deliberative process was predetermined. As other evidence is presented, especially evidence concerning the actual mining site or the ACHP’s treatment of like cases, the Tribunal will revisit this challenge and reexamine Claimant’s need."576
Issue 2: The Tribunal denied Claimant’s challenges as to the timeliness of three documents. The Tribunal deferred final determination on the challenges, "[a]s these documents are allegedly protected by the deliberative process privilege and the Tribunal has determined that it cannot address the necessary issue of Claimant’s need at this early point in the arbitration."577
Issue 3: The Tribunal denied Claimant’s challenge with respect to 11 documents based on the alleged administrative nature of the documents. Paragraph 39 of the April 21 Decision explained: "The Tribunal finds that, if the documents contain information that moves beyond administrative process, they would be protected by the deliberative process privilege and, if they are merely procedural in nature, Claimant would have less need for them." As the documents allegedly were protected by the deliberative process privilege, however, the ultimate determination as to the applicability of the privilege was again deferred.
Issues 4 and 5: With respect to 21 of the ACHP’s withheld documents relating to the ACHP’s review process, and 24 documents relating to opinions and draft versions of the ACHP’s formal comments to the Interior secretary in October 1999, Claimant argued that the qualified deliberative process privilege claimed by Respondent must be outweighed by Claimant’s own need for these documents. With respect to both sets of documents, the Tribunal found that "Claimant ha[d] not presently shown a sufficient likelihood that these documents [would] present necessary evidence for its claims." The ultimate determination as to the applicability of the privilege was again deferred, however, as the documents allegedly were protected by the deliberative process privilege.578

c. Section C: Decisions with respect to Documents Relating to the Mineral Report and Valid Existing Rights Determination

Claimant challenged the withholding of eight documents relating to the draft Bureau of Land Management mineral report for the Imperial Project and other communications concerning the valid existing rights determination. Claimant challenged this withholding on the basis that its need for the documents outweighed Respondent’s interest in the protection of its deliberative process. In deferring final determination of the claim of privilege, the Tribunal wrote:

48. Without determining the precise contours of the deliberative process privilege, the Tribunal is nevertheless mindful and respectful of the Government’s need for the free and open exchange of communications. The Tribunal therefore believes that when the privilege is asserted, it should not be overridden lightly. At the same time, the Tribunal is cognizant that fairness to the party whose interest is affected and who is therefore challenging the assertion of privilege is also important. Balancing these interests, the Tribunal holds that there must be a sufficient enough showing of need to ensure that the governmental process is protected. The Tribunal has not found a sufficient statement of need in the arguments presented at this point, but as the proceedings develop and evidence and witnesses are presented that show these documents to be both relevant and necessary, the Tribunal will reconsider the challenges to assertions of the deliberative process privilege over the documents in this section.

d. Section D: Decisions with respect to Documents Relating to the Development of Solicitor Leshy’s M-Opinion579

Issue 1: Claimant first argued that interim drafts of communications that ultimately are not intended to be confidential are not protected by the attorney-client privilege. Second, Claimant asserted that Respondent’s release of several key documents amounted to waiver of the attorney-client privilege with respect to "the entire spectrum of subject matter relating to the Leshy Opinion...." Respondent claimed that seven of the documents were not, in fact, privileged and, although the other four were privileged, they were produced inadvertently, which does not amount to waiver. The Tribunal examined both aspects of the dispute:

51. The Tribunal is assured that a proper attorney-client relationship did exist at the times of the communications and thus the privilege would ordinarily apply. Whether such privilege was waived by the inadvertent release of several documents must be determined by examining Respondent’s actions surrounding the release. The Tribunal notes that a U.S. judicial decision lists five factors to consider in determining whether an inadvertent production should amount to waiver: (1) the reasonableness of the precautions taken to prevent inadvertent disclosure in view of the extent of the document production; (2) the number of inadvertent disclosures; (3) the extent of the disclosure; (4) any delay and measures taken to rectify the disclosure; and (5) whether the overriding interests of justice would or would not be served by relieving the party of its error. [FN5O] The Tribunal finds these five factors to reflect considerations generally applicable to the analysis of waiver of privilege on the grounds of partial disclosure.

FN50. Koch Materials Co. v. Shore Slurry Seal, Inc., 208 F.R.D. 109, 118 (D.N.J. 2002) (citations omitted).

52. Applying these factors, the Tribunal finds the following. First, the Tribunal recognizes the great care with which Respondent conducted its document production, not only in the logging of the numerous privileged documents, but also in the production of thousands of pages of non-protected documents. Second, the number of privileged documents produced (four) is small in comparison to the overall production by Respondent. Third, the Respondent’s partial disclosure does not appear to be particularly extensive. Fourth, although Respondent has done little to promptly request the return of the documents or take other measures to rectify its apparently inadvertent disclosure, the Tribunal understands that, in a complex arbitration with large scale document production, a party may only become aware of an inadvertent disclosure after such is pointed out or made use of by the opposing party. Therefore, the Tribunal does not find this single factor dispositive. Fifth, the Tribunal finds that there are no overriding interests of justice that would compel it to not relieve Respondent of its error. Therefore, the Tribunal finds that the documents claimed as protected by the attorney-client privilege in this section D are indeed so protected. [FN5l] As the attorney-client privilege is an absolute privilege, no further challenge may be made to the withholding of these documents in this proceeding.

FN51. As mentioned, the Tribunal discovered numerous discrepancies in Claimant’s summary logs and especially in Section D. Therefore, the Tribunal addresses the argument in general and to which documents the argument actually applies will be determined upon further clarification of the privilege logs.

Issue 2: Claimant next argued that the documents were not protected by the work product privilege as they were not created in anticipation of litigation. Further, Claimant asserted, if the work product privilege did apply to the documents, it was waived as the documents did not pertain to a party’s litigation strategies or trial preparation for the present litigation.580
Issue 3: Claimant finally argued that, with respect to the deliberative process privilege, its need for the documents in dispute outweighed Respondent’s interests in secrecy. In addition, Claimant again raised the argument with respect to all documents in this section, except for one, that the deliberative process should not protect these documents as the integrity of the deliberative process was at issue.581
With respect to both challenges described in Issues 2 and 3, the Tribunal’s holding was the same as explained in paragraph 48 of the April 21 Decision, quoted above. The Tribunal did not find a sufficient statement of need in the arguments presented at that point, but stated that, as the proceedings develop and evidence and witnesses are presented to show these documents to be both relevant and necessary, the Tribunal would reconsider the challenges to assertions of the privileges over the documents in this section that are challenged under each privilege and were not deemed protected by the attorney-client privilege above.582

4. Decision with respect to Documents Withheld by Claimant on Grounds of the Attorney-Client and Work Product Privileges

Respondent renewed challenges to Claimant’s claims of privilege with respect to six documents. Claimant produced two of these documents and provided further explanation for the remaining four disputed documents. The Tribunal held:

61. With respect to the four documents remaining at issue, the Tribunal believes that, based on the further clarifications provided by Claimant, the attorney-client and/or work product privileges do indeed protect these documents. Therefore, the challenges to the assertions of privilege with respect to these documents are denied. If, however, Respondent wishes to make additional arguments based on these further explanations of the documents, the Tribunal is willing to hear such arguments.

On March 21, 2008, the Tribunal issued Procedural Order No. 13, in which the Tribunal found that, in accordance with its April 21, 2006 Decision on Requests for Production of Documents and Challenges to Assertions of Privilege, in order to assess Claimant’s renewed request for documents withheld on the basis of privilege, the Tribunal must determine whether Claimant had stated sufficient materiality of the documents, in light of the Tribunal’s current deliberations and determinations, to warrant application of the balancing test required by the deliberative process privilege. Based on Claimant’s arguments and issues currently before the Tribunal in deliberations, the Tribunal determined that these documents with respect to which Claimant had renewed its request for production at the hearing (California Log Nos. 162, 192, 193, 194, 197 and 208) did appear to be material and there was a need for the Tribunal to review them. Although the Tribunal recognized the assertions for and interests in the deliberative process privilege, it found the need to review these documents to be sufficiently great to override these interests. Therefore, the Tribunal requested Respondent to produce these six documents to the Tribunal and Claimant, at its earliest opportunity.
In making this request for production, the Tribunal accepted the same conditions under which California had agreed to produce documents in May of 2006. Namely, the documents would be covered by a confidentiality agreement and used only for the purposes of this Arbitration. California’s production would be without prejudice to its ability to assert a claim of privilege or exemption from disclosure with respect to any of these documents in any other legal proceeding.
Procedural Order No. 13 additionally provided that, within three weeks of the production of these documents, the Tribunal would accept brief analysis of the content of these documents and their relevance from the Parties. The Tribunal informed the Parties that these comments had to be strictly limited to the relevance of the newly produced documents and arguments already made.
In accordance with Procedural Order No. 13, California produced to the Tribunal and Claimant California Log Nos. 162, 192, 193, 194, 197 and 208 on August 13, 2008.
Also in accordance with Procedural Order No. 13, the Parties timely filed their comments with respect to relevance of these documents within the three-week time limit, on September 3, 2008. Respondent argued that the six documents prove that, "while the Imperial Project may have served as the impetus" for the California measures, they were targeted at open-pit mining generally, and not the Imperial Project.583 Respondent asserted that the documents make clear that the "key concern" was to ensure that operators, not taxpayers, covered clean-up costs.584 Finally, Respondent contended that the measures "responded, independently, to different concerns and constituencies."585 In its submission, Claimant argued that the six documents provided further support for its arguments that: Senate Bill 22 and the emergency backfilling regulations targeted the Imperial Project; "the acknowledged purpose" of both California measures was to make the Project economically infeasible; and the California measures were not "mere clarifications of pre-existing reclamation requirements in California."586 Claimant additionally argued that redactions on three of the documents produced were improper in that they removed information on "internal processes" that Claimant viewed as integral to its argument that "the two California measures were closely related avenues to accomplish a single objective."587 Claimant therefore requested the Tribunal to draw an adverse inference to this effect.588
On September 26, 2008, Respondent timely submitted its response to Claimant’s request for an adverse inference with respect to redactions on documents 162, 192 and 197.589 Respondent argued that, in considering whether an adverse inference should be drawn, a tribunal should look at whether: (1) the party has possession or control of the documents; (2) the party has provided any evidence contrary to the adverse inference sought; (3) the party has provided a reason for its non-disclosure; and (4) there exists a logical nexus "between the probable nature of the non-disclosed information and the inference to be drawn."590 Respondent argued that each of these four factors weighs against the drawing of an adverse inference. First, the privileged documents are in the possession of the State of California, a non-party which has nonetheless "acted in a spirit of voluntary cooperation."591 Second, Respondent asserted that it "has produced extensive evidence addressing... whether the SMGB Regulation and SB 22 were ‘inextricably intertwined’ efforts to ‘stop the Imperial Project from ever proceeding.’"592 Third, Respondent points to the sworn affidavits explaining the reasons for the redactions, and the fact that the redactions are very limited.593 Fourth and finally, Respondent argued that Claimant is attempting to draw "sweeping" conclusions— conclusions that Claimant has failed to prove with the thousands of produced documents—from limited, non-substantive redactions.594 Respondent closed by offering an in camera review of the redactions, if the Tribunal were to determine that such a review would be helpful.595
Claimant timely submitted its response to Respondent’s submission on October 2, 2008.596 Claimant countered each of Respondent’s arguments. First, Claimant argued that "internal governmental structure provides no excuse under international law," and that the NAFTA makes State Parties responsible for their state governments.597 Second, Claimant asserted that Respondent’s rule that no adverse inference is possible if "any credible evidence" is produced allows a party to produce only favorable evidence, while withholding damaging evidence with impunity.598 Third, Claimant argued that Respondent’s affidavits fail to explain why the redactions’ substance "is so sensitive that redaction is ‘compelled’"; and argued that the custodian’s feeling "compelled" to withhold the information is conclusory.599 Fourth, Claimant asserted that there is evidence in the record supporting its conclusion; specifically, it argued that "it is indisputable" that Governor Gray Davis’ "own directive" called for legislative and executive actions to block the Glamis mine.600 Finally, Claimant explained that it did "not consent to any open-ended process" such as the offered in camera review, citing the five months for the production of the redacted documents and Respondent’s offer only to "work with" California to secure the review.601
The Tribunal responded to the Parties on October 9, 2008, and specifically addressed the issue of a possible in camera review.602 The Tribunal commended both Parties’ good faith efforts with respect to the production of the six California documents.603 The Tribunal further stated that it did believe it needed Party consent to conduct such an in camera review and further that "it [was] not entirely persuaded that it should draw the requested adverse inference by what has currently been produced and argued by the Parties."604 In light of this, the Tribunal explained that it might therefore decide to close the issue in favor of Respondent, but would conduct the in camera review offered by Respondent, should Claimant prefer.605
Claimant responded to the Tribunal on October 15, 2008, turning down the offer of in camera review.606 Claimant, though noting the Tribunal’s assurance that it would conduct the review "with great haste," explained that it was "less sanguine that Respondent [would] actually produce the documents in a timely fashion." Claimant therefore "respectfully requested the Tribunal make its ruling on the redactions and proceed with the issuance of the decision on the merits."607

G. Party Submissions

On May 5, 2006, Claimant submitted its Memorial, in accordance with Procedural Order No. 8 and an extension granted in an April 25, 2006 letter from the Tribunal.
On September 19, 2006, Respondent submitted its Counter-Memorial, also in accordance with Procedural Order No. 8 and the Tribunal’s April 25, 2006 letter to the Parties.
On October 20, 2006, Claimant contacted the Tribunal by letter and requested a four to five week extension for the submission of its Reply.608 Claimant detailed three events as causing it to request an adjustment to the case management schedule. In making this request, Claimant recognized that such an extension would necessitate an equal extension for Respondent’s filing of its Rejoinder and could require the delay of the final arbitral hearing.
By letter of October 23, 2006, Respondent objected to Claimant’s extension request, arguing that the cited events did not, individually or collectively, justify the lengthy extension requested. Respondent also cited the extreme difficulty of revising the briefing schedule at that juncture without creating conflicts with Respondent’s other pending cases. Therefore, Respondent requested the Tribunal to deny Claimant’s extension request. In the alternative, if the request were to be granted, Respondent submitted that the hearing would have to be postponed.
On October 31, 2006, the Tribunal issued Procedural Order No. 9. In response to Claimant’s request for an extension for the filing of its Reply, the Tribunal wrote:

11. The Tribunal recognizes the diligent efforts of both Parties to comply with the numerous and difficult requirements of the pre-hearing submission schedule. At the request of the Parties, the Tribunal has attempted to maintain a very tight timeline so as to facilitate a final arbitral hearing at the earliest date possible. This, however, has continually challenged the Parties and left no room for unexpected circumstances.

12. The Tribunal is aware of its dual responsibility to keep the arbitration schedule moving effectively forward and to ensure that both parties have the opportunity to develop and present reasoned and supported arguments. The Tribunal believes that the circumstances described by Claimant impair its ability to effectively prepare its case and thus an extension is required, though this necessitates adjustment to the hearing dates. In granting an extension to the Claimant, an equal extension of time has been granted to the Respondent....

Procedural Order No. 9 postponed the deadlines for the submission of Claimant’s Reply until December 15, 2006, and Respondent’s Rejoinder until February 27, 2007.609 In addition, the final arbitral hearing was moved to May 2007, with the understanding that the Assistant to the Tribunal would work with the Parties to ascertain an exact date for the hearing.
In informal discussions between the Parties and the Assistant to the Tribunal, it was determined that the May 2007 timeframe for the final arbitral hearing was not possible for Respondent, due to previously scheduled hearings in other cases. Other dates were discussed and, on December 15, 2006, the Tribunal confirmed in a letter to the Parties that the final arbitral hearing would be held on August 13 to 17, 2007 and, as necessary, September 17 to 21, 2007. In this letter, the Tribunal stated that it appreciated the concerns expressed by Respondent concerning the division of argument between the two weeks. The Tribunal wrote that it would determine the division "in a manner that ensures fairness for both Parties, both in general now and again, in specificity, at the pre-hearing procedural hearing. The inclination of the Tribunal is to structure the hearing on an issue-by-issue basis, with the exact number, order and time limits of each issue determined at the pre-hearing procedural hearing." The Tribunal requested that the Parties consult with each other regarding a possible structure for the hearing in light of the Tribunal’s comments and communicate any agreement, or their differing views, for consideration by the Tribunal. Finally, the Tribunal expressed its intent to use as much of the second week as possible for deliberations and, therefore, the Tribunal requested that the Parties inform the Tribunal if, after consultation with each other, they believed the hearing would take appreciably longer than a week.
Also on December 15, 2006, Claimant timely filed its Reply.
On February 22, 2007, the Tribunal issued Procedural Order No. 10 confirming amendments to the arbitral schedule upon which the Tribunal and Parties had agreed in informal discussions with the Assistant to the Tribunal. In this order, the deadline for the submission of Respondent’s Rejoinder was scheduled for March 15, 2007; the deadline for the submission of witness lists was set for June 14, 2007; and the pre-hearing procedural hearing was scheduled on June 28, 2007 in Washington D.C. The final arbitral hearing was confirmed as August 13 to 17, 2007 and, as necessary, September 17 to 21, 2007.
On March 15, 2007, Respondent timely filed its Rejoinder.

H. Article 1128 and Non-Disputing Party Submissions

In Procedural Order No. 1 issued on March 3, 2005, the Tribunal presented the initial arbitral schedule. In this schedule, the deadline for the receipt of any applications for leave to file Article 1128 or non-disputing party submissions, and their corresponding submissions, was March 3, 2006.
On March 9, 2005, the Quechan Indian Nation (the "Quechan") forwarded a letter610 to the Tribunal expressing its wish to participate in this matter. By letter dated June 21, 2005, Tribunal President Michael K. Young advised the Quechan that the Tribunal would consider its request pursuant to the principles articulated in the Free Trade Commission’s Statement on non-disputing party participation (the "FTC Statement") and called its attention to Section B of the FTC Statement for details on the procedures for submitting an application and submission. His letter further advised that the application and submission should be submitted by July 26, 2005.
The Quechan then, in a facsimile on July 22, 2005, requested to submit its application and submission in March 2006, after the Parties submitted their memorials. Tribunal President Young, by a letter dated July 28, 2005, advised the Quechan that the Tribunal intended to allow participation by qualified non-parties but, in doing so, to also avoid disruption of the proceedings and to minimize any burden to the Parties. This letter set the application and submission deadline for August 19, 2005.
On August 19, 2005, the Quechan Indian Nation timely filed its application for leave to file a non-disputing party submission and its corresponding submission.
On August 26, 2005, however, the Tribunal amended the date for the filing of non-disputing party applications and submissions pursuant to the FTC Statement in its Procedural Order No. 4. The Tribunal, "wishing to provide the Claimant and the Respondent time to respond to the merits of any such submissions authorized and accepted by the Tribunal while simultaneously avoiding delay in completion of the arbitration proceeding," set September 30, 2005 for the filing of applications and submissions pursuant to the FTC Statement.
On 26 August 2005, the Tribunal also contacted the Parties for comments on whether the Tribunal should accept the Quechan application and submission. On September 15, 2005, Claimant deferred to the views of the Tribunal, while taking issue with a number of factual and other aspects of the submission. Respondent, on the same date, asked the Tribunal to accept the application and submission, stating that they qualified for acceptance under the FTC Statement.
The Tribunal issued its Decision on Application and Submission by Quechan Indian Nation on September 16, 2005. In this decision, the Tribunal first defined the applicable law:

8. This arbitration is conducted under the UNCITRAL Arbitration Rules.

9. The Tribunal need not now decide whether the discretion to accept substantive materials from non-parties is within the discretion of the Tribunal under Article 15(1) of the UNCITRAL Rules. The Free Trade Commission’s Statement on nondisputing party participation indicates that the three states in NAFTA accept such statements. More particularly, the parties in this proceeding do not object to such statements, at least where consideration of the material is in accordance with the Free Trade Commission’s Statement.

The Decision on Application and Submission by Quechan Indian Nation proceeded to express the Tribunal’s view that the submission satisfied the principles of the FTC Statement and did not present undue burden or cause delay, and thus concluded that the submission was accepted. The Tribunal added, however, that the granting of leave did not require the Tribunal to address the submission at any point in the Arbitration, nor did it entitle a non-disputing party to make further submissions in the Arbitration. The Tribunal also noted that Parties would have further opportunity to comment on the submission, up to and including, respectively, the Memorial and C ounter-Mem ori al.611
On September 23, 2005, the Tribunal received requests for extensions of the deadline for submitting non-disputing party applications to file and corresponding submissions from Sierra Club/Earthworks and Friends of the Earth. These requests came in response to Procedural Order No. 4's amendment to Procedural Order No. 1 with respect to the deadline for these submissions from March 3, 2006 to September 30, 2005, as well as the concern by these non-disputing parties that this order had not been promptly posted on the U.S. Department of State website, resulting in their learning of the change with little notice.
On September 30, 2005, Friends of the Earth Canada and Friends of the Earth United States timely submitted to the Tribunal an application to file a non-disputing party submission and a corresponding submission.
Also on September 30, 2005, the Tribunal notified all interested non-disputing parties of an extension of the deadline for the filing of non-disputing party applications and submissions until October 26, 2005.
On October 3, 2005, a hearing was conducted before the Tribunal at which the Parties discussed, among other items, the requests of certain non-disputing parties that the Tribunal reconsider its previous decision that non-disputing party submissions be filed prior to the filing of the Parties’ memorials. These non-disputing parties asserted that they could not submit meaningful submissions without the benefit of the Parties’ Memorial and Counter-Memorial. The Parties understood the concerns of the nondisputing parties and agreed that non-party submissions could be filed contemporaneously with any Article 1128 filings, roughly a month following the submission of Respondent’s Counter-Memorial.
Confirming the agreements reached at the October 3, 2005 hearing, the Tribunal issued Procedural Order No. 6 on October 15, 2005. This order set the deadline for submission of any Article 1128 and non-disputing party submissions on July 20, 2006, almost one month after the June 22, 2006 deadline for the submission of Respondent’s Counter-Memorial.
The submission deadline was extended by Procedural Order No. 8, issued on January 31, 2006, in accordance with the postponement of the final arbitral hearing. The new date for the submission of any Article 1128 and non-disputing party submissions was October 13, 2006.
In accordance with Procedural Order No. 8, on or before October 13, 2006, the Tribunal received an application for leave to file a non-disputing party submission and a corresponding submission from the National Mining Association, as well as a request for the renewal of its non-disputing party application and submission originally filed on September 30, 2005 from Friends of the Earth. In addition, on October 16, 2006, the Tribunal received a non-disputing party application and submission from Sierra Club and Earthworks pursuant to an extension granted by the Tribunal on October 10, 2006.
Also on 16 October 2006, the Tribunal received an application for leave to file a supplemental non-disputing party submission and corresponding supplemental submission from the Quechan Indian Nation. The supplemental submission included an expert paper from Dr. Tom King that, in subsequent email correspondence, the Quechan’s counsel requested to remain confidential and not be posted on the internet or provided to the public. The Tribunal responded on October 31, 2006, explaining that the "transparency of Chapter Eleven tribunals is of particular importance to the member states of the... (NAFTA)." The Tribunal noted that the FTC stated that "[n]othing in the NAFTA imposes a general duty of confidentiality," and that, in fact, the FTC explained that each Party agreed to make available to the public all documents submitted in a Chapter 11 dispute—including documents by non-disputing parties—subject to redaction.612 The Tribunal therefore explained that it was not willing to grant a request to keep the entire report confidential, but invited the Quechan to submit another request for particular sections of the report to be redacted, specifying the paragraphs of concern and the basis for its request for confidentiality. The Quechan replied on November 15, 2006, agreeing to not mark the report as confidential in that, among other reasons, it responded to the report of Claimant’s cultural expert and did not reveal confidential cultural information, and "the Tribe concurs with the Tribunal that proceedings under NAFTA should strive for increased transparency."
The government of Canada notified the Secretary to the Tribunal by email correspondence on October 13, 2006, that it did not intend to file a NAFTA Article 1128 submission on that date, but wished to reserve the right to make submissions at the hearing.
On December 15, 2006, in accordance with Section B(5) of the FTC Statement and its previous practice, the Tribunal requested any comments the Parties had with respect to the Tribunal’s decisions to accept or reject the above-mentioned applications to file non-disputing party submissions. The Tribunal requested all such comments be submitted by January 18, 2007. The Tribunal reminded the Parties that they should not argue the content of the non-disputing party submissions at that time, but merely should address the applications for leave to file submissions. The Tribunal explained that it would issue a letter following the receipt of the Parties’ comments stating which submissions were accepted. After that point, the Parties were invited to address the content of those submissions in written submissions, if they had not already done so in their Reply and Rejoinder.
On January 18, 2007, the Parties timely submitted their comments on the nondisputing party applications to file submissions. Respondent requested that the Tribunal accept each submission, insomuch as it met the requirements of the FTC Statement in terms of both length and content. Respondent stated its full support of amicus participation, as long as that participation was effectuated in a manner that avoided placing undue burden on the Parties. Claimant did not object to the applications of the National Mining Association, the Quechan Indian Nation, or the Sierra Club and Earthworks, as it already had filed substantive comments with respect to these submissions. Claimant, however, did object to the application of the Friends of the Earth as, Claimant argued, it largely addressed the nationality of Glamis (now Goldcorp, Inc.) which is not at issue in this case.
On February 15, 2007, the Tribunal issued its decisions on the non-disputing party applications to file submissions in separate letters to each of the National Mining Association, the Quechan Indian Nation, Sierra Club and Earthworks, and Friends of the Earth. The Tribunal decided to accept each submission and consider it, as appropriate, in accordance with the principles stated in the FTC Statement and the particular criterion mentioned by Respondent that each submission bring "a perspective, particular knowledge or insight that is different from that of the disputing parties."613 The Tribunal expressed its view that it should apply strictly the requirements specified in the FTC Statement, for example restrictions as to length or limitations as to the matters to be addressed, but that, given the public and remedial purposes of non-disputing submissions, leave to file and acceptance of submissions should be granted liberally. These matters, the Tribunal determined, were best considered at a later point in the proceedings, as necessary. In accepting each submission, the Tribunal noted Section (B)(9) of the FTC Statement, which states that acceptance of a non-disputing submission does not require the Tribunal to consider that submission at any point in the arbitration, nor does it entitle the non-disputing party to make any further submissions. Finally, the Tribunal expressed its intent to ensure that the incorporation of any submission, or parts thereof, would not unduly burden the Parties or delay the proceedings.

I. Pre-Hearing Procedural Hearing