Jury Awards $100M Damages to Vested Mine Operators

Joe and Yvette Hardesty and the Jay Schneider family were awarded more than $100 million in damages against Sacramento County in federal court on Tuesday, March 21. The litigation was one in a long line of lawsuits and administrative actions concerning the Hardesty’s vested mining operations on the Schneider property over the last eight years.

The federal court jury found that Sacramento County violated the Hardesty’s and Schneider’s civil rights and rights to due process by taking regulatory actions oriented toward destroying the Hardesty-Schneider mining operation. The County acted allegedly to benefit competing mining operations in the region. The jury verdict not only awarded damages against Sacramento County, but also individually against certain current and former County officials.

Evidence presented in the litigation established that, beginning in 2007, the County coordinated with a competing mine operator to orchestrate enforcement action against the Hardesty-Schneider operation. The County’s actions ultimately prompted enforcement actions by several other regulatory agencies, including the Department of Conservation, state and federal wildlife agencies, and the Army Corps of Engineers. The County also initiated its own enforcement action to “revoke” the mine’s vested mining rights, which the County had recognized for decades. Finally, the County increased the mine’s reclamation financial assurance requirement from $164,000 to $8.8 million.

Although fundamentally a civil rights and due process case, the litigation highlighted the resilience and value of vested mining rights in the highly-regulated California construction materials market. The Hardesty-Schneider operation’s vested status conferred the right to operate free of many conditions and operating restrictions that the County imposed on more recent mining operations through the County zoning code and use permit requirements. As a result, the Hardesty-Schneider operation could ostensibly produce and market construction materials at a lower cost than competitors in the region whose operations were subject to County operating conditions.

Harrison, Temblador, Hungerford & Guernsey LLP lawyers defend vested mining rights throughout California. Recent successes include establishment of vested rights across more than 230 acres in San Luis Obispo County, and confirmation of vested rights across more than 1,500 acres in Santa Clara County.

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