A federal appeals court Tuesday rejected Drakes Bay Oyster Company's bid to stay in business in the Point Reyes National Seashore, backing the Interior Department's decision to terminate the company's commercial shellfish operation.
In a 2-1 ruling, the 9th Circuit U.S. Court of Appeals in San Francisco held that the oyster company was "not likely to succeed" in proving in court that former Interior Secretary Ken Salazar erred in refusing in November to renew the company's permit to operate in the federally protected waters of Drakes Estero.
The ruling rebuffed farm owner Kevin Lunny's request for an order, known as an injunction, to continue harvesting $1.5 million worth of oysters a year from the nearly pristine estero, a 2,500-acre Pacific Ocean estuary, while it pursues its court case.
But it did not specify the consequences of that decision, and Lunny said Tuesday he is still operating "in full swing" following a busy Labor Day weekend at the farm near the west end of Sir Francis Drake Boulevard.
"I don't know what's next," Lunny said in a telephone interview. "A lot of people's livelihoods are riding on this."
The farm employs 30 people, and if it ultimately loses in court would likely be required to remove about 18 million oysters from the water, lay off its workers and possibly remove five miles of wooden oyster-growing racks from the shallow estero.
The seven-year-old controversy over the oyster farm has divided neighbors in West Marin County and gained national attention, with advocates for greater commercial use of public lands jumping in on Lunny's side.
A Washington, D.C.-based nonprofit called Cause of Action, which critics said had ties to the ultra-conservative Koch brothers, argued Lunny's case in court until he cut ties with the group in May.
In March, Sen. David Vitter, R-La., included a provision granting the oyster company a permit in a bill aimed at creating 2 million jobs and $2 trillion in federal taxes through commercial use of natural resources, including offshore oil drilling and approval of the Keystone XL pipeline.
Lunny said Tuesday he "strongly disagrees" with the ruling, which upheld a judge's decision in February in an Oakland federal district court.
Lunny appealed that decision and was granted permission to remain in business pending an appeals court hearing.
In a written statement, Lunny said his attorneys "are now reviewing all of our options before we announce our plans moving forward."
The oyster farm could appeal to an 11-judge panel of the 9th Circuit or to the U.S. Supreme Court.
However, if the farm cannot continue selling oysters, the case is most likely moot, Lunny said in May.
The legal battle began in December, when Lunny filed a federal lawsuit alleging that Salazar's refusal to renew the oyster farm's permit was "arbitrary and capricious and an abuse of discretion."
Rejecting that claim, the appellate court majority said that the oyster company "failed to raise a serious question about the Secretary's decision" and that it would be "unlikely to prevail" on that point.
The 50-page decision also dismissed repeated allegations in legal papers and by allies of the oyster farm that the National Park Service had used "flawed science" to assess the farm's impact on the 2,500-acre estero, home to extensive eelgrass beds and a harbor seal colony.