No Oil Inc v. City of Los Angeles

(Still being edited)

The California Supreme Court halted Occidental Petroleum’s risky wildcat oil drilling on LA coast without prior preparation of an EIR, a case Tom Bradley championed in his successful bid for Mayor. The Court’s decision established a low threshold for mandating preparation of an EIR: if there is merely “substantial evidence“ in the record that proposed development activities may have significant environmental impacts, thereby reversing the usual “substantial evidence” test that typically shields agency actions. During the litigation; Occidental Chairman Armand Hammer unsuccessfully demanded that the Ford Foundation pull CLIPI’s funding. Later, voters approved a ballot measure that would ban the proposed drilling, and Oxy ultimately deeded the site to LA for a public park.

Shortly after the Supreme Court issued the seminal CEQA decision in Friends of Mammoth was issued in September 1972, the City of Los Angeles was presented with one of the first tests regarding whether local governments would have the political will to comply with the newly announced Environmental Impact Report (EIR) requirements. The test involved a proposed "wildcat" oil drilling exploration at the edge of Santa Monica Bay near Will Rogers State Beach.

Just a few years earlier, the infamous "blowout" and extensive ensuing environmental destruction caused by oil drilling operations of the Santa Barbara coastline had galvanized the environmental movement to declare that similar environmental horrors should never happen again. The political momentum created by these unfortunate events led directly to passage of NEPA at the federal level and CEQA at the state level. The entire purpose of these statutes was to ensure that, before such risky potentially environmentally damaging activities are pursued, adequate studies must first be undertaken to ensure that environmental considerations are at the forefront of an agency's decision and that all feasible mitigations are imposed.

Yet now, shortly after Friends of Mammoth ruled that local governments must prepare EIRs before making decisions that may significantly impact the environment, Los Angeles was proposing to allow Occidental Petroleum to set up exploratory drilling rigs at a beach location just a few miles south of the Santa Barbara disaster. It seemed inconceivable to the leaders of No Oil, Inc. that the City could approve the proposed drilling without an EIR.

Both the local Board of Zoning Appeals and the Planning Department's hearing examiner recommended against the drilling because the risks, such as blowouts and landslides, were too great. Nonetheless, following stormy public hearings, the  City Council had narrowly voted eight to seven to approve the drilling.

Rushing to beat the effective date of Proposition 20 (the Coastal Act), Occidental began construction of its drill rigs just one day prior to the date by which the Act would require a permit from the new Coastal Commission. CLIPI's attorneys filed suit on No Oil’s behalf and brought  an emergency appeal to the California Supreme Court seeking a stay of the drilling. The Court granted the petition in early 1973, halting Oxy’s construction. 

Two years later, the case found its way back to the Supreme Court for a ruling on the merits. The Court determined that the case presented an "excellent example" of the type of situation where an EIR would provide valuable information to the citizenry and decision-makers about the potential environmental impacts of a controversial project. The Court also described the type of careful preliminary process by which public agencies should make the key determination whether to prepare an EIR or a written Negative Declaration. 

Following the Supreme Court's No Oil decision, Occidental Petroleum kept a fence around its oil drilling equipment at the site for many years. Meanwhile, controversy continued to rage. Mayor Tom Bradley, whose opposition to the drilling was a key plank in his successful run for the first of his four terms as Mayor, was later pleased to discover that his then rival, former Mayor Sam Yorty, who had strongly pushed the Oxy drilling application through the City's bureaucracy, admitted to accepting favors from Occidental. Ultimately, Occidental agreed to deed the site to the City, and the City thereupon incorporated the land into the adjacent Palisades Park.

CLIPI’s visibility on the Ford Foundation’s radar screen also increased as a result of litigation. The Ford Foundation had initially funded CLIPI with a relatively modest grant in 1972.  Occidental’s Chairman, Armand Hammer began a personal campaign to persuade the Foundation to stop funding CLIPI, threatening to report the Foundation to the IRS for supposedly violating IRS “charitable” tax exempt entity rules on the ground that Ford’s grantee was using Foundation money to represent elitist environmentalist in a frivolous case designed to protect private property rights, not broader public interests. Hammer telegrammed Foundation President McGeorge Bundy, while his lawyers wrote to various CLIPI trustees with repeated threats designed to intimidate CLIPI and persuade it to pull out of the litigation. Despite deep concerns on the part of all involved, CLIPI was supported by its friends throughout this turmoil. The Ford Foundation renewed and substantially increased the size of its CLIPI grant.