Daingerfield Island Protective Society v. Lujan

Charles Fairchild & Co. (Fairchild) owned an environmentally sensitive parcel of wetland property on the Dyke Marsh (the Dyke Marsh parcel). Fairchild also held development rights to a parcel across from the Dyke Marsh (Potomac Greens). Environmental groups were opposed to any development of the Dyke Marsh, and Fairchild decided to focus his development efforts on Potomac Greens. In 1970, Fairchild and the National Park Service (NPS) entered an agreement (the 1970 exchange agreement) under which Fairchild agreed to deed the Dyke Marsh parcel to the NPS and the NPS agreed to give Fairchild an easement to build a traffic interchange. Fairchild hoped to construct the interchange in a manner that would divert traffic to Potomac Greens, where he planned to build a mixed-use complex. The 1970 exchange agreement was signed in 1971, and Fairchild submitted construction plans for the interchange in 1975. The project stalled for a while thereafter. In 1978, Daingerfield Island Protective Society (the society) (plaintiff) initiated legal action to stop the approval of an interchange design. The court dismissed the action as premature. In 1981, the NPS approved a proposed design on the interchange subject to further planning. In 1984, the NPS issued an easement deed to Fairchild’s successor-in-interest, RF&P. In 1986, the society filed a lawsuit against the NPS, RF&P, and other parties (collectively, the government) (defendants) seeking to set aside the 1970 exchange agreement and void approval of the interchange design based on alleged violations of various environmental laws, including the National Environmental Policy Act. At the time of the suit, the government had incurred no more than $692,000 on the project, which was estimated to cost a total of $500 million. Construction had not yet begun. The government moved for dismissal or summary judgment. The district court ruled in the government’s favor on grounds of laches, and the society appealed.