Environmental, tribal groups sue to block Trump ESA rule changes to habitat

Environmental and tribal groups filed three federal lawsuits July 14 challenging a Trump administration rule that removes habitat protections under the Endangered Species Act, creating regulatory uncertainty for energy project developers seeking permits despite industry support for the changes.

The rule — announced July 10 and published in the Federal Register July 14 — eliminates the definition of "harm" to species habitat without providing a replacement, prompting attorneys who represent energy clients to warn that companies could face litigation over how federal agencies interpret the law going forward.

The lawsuits allege that the rule defies the text and purpose of the ESA and reverses 50 years of administrative policy, as well as a 1995 US Supreme Court precedent. The suits were filed in federal district courts in California and Washington State.

The groups claim the rule violates the language of the law and is arbitrary and capricious under the Administrative Procedure Act. They also argue that the Interior and Commerce departments failed to comply with the National Environmental Policy Act when issuing the rule.

The groups contend that the rule will create confusion for industries seeking federal permits by removing regulatory certainty over what will be required for incidental take statements under the ESA, despite what they describe as a clear requirement in the law to account for habitat destruction or modification.

The Interior Department pushed back on the suits' assertions. The lawsuits seek to preserve "a decades-old regulatory overreach that expanded the Endangered Species Act beyond the authority granted by Congress," an Interior spokesperson said July 15. The role of federal agencies is to implement the ESA as written, "not to expand its reach through interpretations favored by advocacy organizations," the spokesperson added.

"The department will vigorously defend its authority to implement the law according to its plain text," the spokesperson said.

Ambiguity, disagreement may continue

Numerous federal agencies have historically considered potential harm to protected species' habitat when conducting energy project reviews. Agencies' biological opinions include incidental take statements, which set the extent of legally permitted direct harm to, or deaths of, protected species by project developers under the ESA.

Because the definition of "harm" has been removed without replacement, the US Fish and Wildlife Service and National Marine Fisheries Service are expected to narrow their reviews for incidental take statements, Seth Barsky, a partner at Bracewell, said during a July 14 interview.

Energy companies would be wise to consult with federal agencies on how the new rule will be implemented, Barsky and other attorneys said.

Due to lawsuits challenging the rule and potential project-by-project challenges to future incidental take statements, "it is possible that the issue of whether and to what extent impacts to listed species' habitat qualify as 'take' under the ESA could be in flux for quite some time," Rebecca Hays Barho, a partner at Nossaman, said in a July 14 email. "Ultimately, the issue may not be resolved until Congress or the Supreme Court weighs in."

Just as there has been "ambiguity and disagreement" when the definition of harm to habitat was included in regulatory proceedings, "it is likely that there will continue to be ambiguity with respect to how the agencies view 'take'" under the ESA with the new rule, Barho added. "Approaches could vary across regions and across different classes of species," and federal courts may differ on how they interpret habitat modifications.

The FWS and the NMFS said they will address habitat-related impacts through other provisions in the statute, including Section 7 consultations and Section 5 land acquisition authorities.

Lawsuits filed in Western courts

Earthjustice submitted one of the newly filed lawsuits on behalf of plaintiffs including the Center for Biological Diversity, Columbia Riverkeeper, Conservation Northwest and the Sierra Club. The plaintiffs asked the US District Court in Seattle to vacate the rule, declare it invalid and reinstate the regulatory definition of "harm" to species habitat that agencies used for decades.

The ESA's long-standing regulatory definition of harm "reflected an overwhelming body of scientific evidence demonstrating that loss of habitat imperils species in multiple ways," such as disruptions affecting breeding, feeding and shelter, the plaintiffs said.

The Swinomish Indian Tribal Community and Squaxin Island Tribe also challenged the rule in the US District Court in Seattle, asserting that the agencies' new interpretation of the ESA regarding habitat means salmon populations in the region are unlikely to survive habitat destruction.

A third legal challenge was filed by the Environmental Protection Information Center, the Western Environmental Law Center, Friends of the Shasta River and others in the US District Court in the Northern District of California.

"No longer protecting where grizzlies, salmon, and owls live will make them go extinct," Pete Frost, an attorney with the Western Environmental Law Center, said in a statement. "We're hopeful the court will clarify what the Endangered Species Act has always meant."

"The recission of the harm definition will have an immediate effect on pending biological opinions" for projects being reviewed by the federal agencies where endangered species habitat is threatened, environmental groups said.

Industry support

The American Petroleum Institute and other industry groups argued in comments on the proposed rule in 2025 that the definition of harm should be narrowed to include only acts that directly kill or injure fish or wildlife.

"The US oil and natural gas industry has taken significant steps to minimize its impacts on wildlife and the environment while continuing to produce essential energy for the American public," Holly Hopkins, vice president of upstream policy for the API, said in a statement. "We remain committed to supporting commonsense ESA policies that both protect wildlife and support American energy leadership."

Considering habitat degradation or modification that kills or injures wildlife stretches the term "harm" beyond its natural meaning and creates overlap with other provisions of the ESA, agencies said in the final rule.

When issuing an incidental take permit, the Interior secretary "will no longer consider the effects of a proposed action on the species' habitat, nor will the permit contain terms and conditions requiring permittees" to account for habitat modification and degradation, according to the rule.

The Western Energy Alliance declined to comment on the final rule until it has discussed it with its members. However, in its 2025 comments on the proposal, the Alliance supported the rule, saying it would "ensure that moving forward, ESA will not be used to prohibit productive human activities such as energy development that may affect habitat but do not actually result in the taking of species."

Legal precedent questions

In the recently released rule, the agencies adopted the view of three dissenting justices in the 1995 Supreme Court decision — Babbitt v. Sweet Home Chapter of Communities for a Great Oregon — and determined that the existing definition of "harm" was not the best reading of the ESA.

Earthjustice, by contrast, said the 1995 ruling remains the law of the land and that the agencies' reliance on the 2024 Supreme Court decision in Loper Bright Enterprises v. Raimondo, which ended courts' practice of deferring to federal agencies, is in error.

Rather, the agencies' adoption of a policy that runs counter to the ESA and favors an executive branch interpretation of the statute is the very type of interpretation the Supreme Court rejected in Loper Bright, Earthjustice claimed.

Relying on a dissenting view from the high court for a new rule is "certainly unusual," because the majority in the Sweet Home ruling upheld the regulation at issue, said Barsky of Bracewell.

Because the lawsuits were filed in federal district courts, they "probably have a good chance" of receiving favorable rulings because district court judges typically do not feel comfortable going in a different direction than a Supreme Court precedent, Barsky added during the interview.