Davis v. Morton

In 1970, the Pueblo Indians (the Pueblos) leased land to Sangre de Cristo Development Company, Inc. (Sangre), a New Mexico corporation, for property development. The land was held in trust by the federal government on the Pueblos’ behalf. The Department of the Interior (the government) (defendant) approved the lease agreement. The agreement required that approvals be made by the government and protected the government from liability. Landowners living near the leased Indian property and nonprofit corporations (the concerned parties) (plaintiffs) filed suit in a US district court seeking a preliminary injunction to prevent Sangre from doing any development work on the leased property. The National Environmental Policy Act of 1969 (NEPA) requires federal agencies to incorporate environmental considerations into decision-making by preparing detailed environmental-impact statements for major federal actions that significantly affect the environment. The concerned parties argued that—because the approval of the lease was a major federal action and no environmental-impact study had been conducted prior to the approval—the government lacked the authority to approve the lease pursuant to the NEPA. The government argued that the lease was not a federal lease because the government was not a party to the lease and therefore that it did not constitute a major federal action requiring an environmental-impact study under the NEPA. The district court agreed and held that the government’s approval of the lease did not constitute a major federal action under the NEPA. The concerned parties appealed.