Mateusz Perkowski/Capital Bureau
ALBANY — The state has conceded that a class-action lawsuit seeking $1.4 billion for insufficient timber harvests isn’t blocked by the statute of limitations.
The state government has also dropped its argument that county governments and local taxing districts don’t have legal standing to sue for alleged breach of contract.
Last year, Linn County filed a lawsuit accusing the state of violating contracts with 15 counties by reducing logging on about 650,000 acres of forestland the counties had donated to the state.
The lawsuit was certified as a class action by Linn County Circuit Judge Daniel Murphy, which means the 15 counties and roughly 150 taxing districts, such as schools and fire departments, were joined as plaintiffs in the case.
Since then, Clatsop County and a few smaller taxing districts have opted out of the lawsuit.
Attorneys for the plaintiffs had asked the judge to eliminate 12 “affirmative defenses” intended to shield the state from the lawsuit.
During oral arguments on Thursday, Oregon’s attorneys agreed to drop several of these defenses, including the expiration of the statute of limitations, the plaintiffs’ lack of legal standing and the court’s lack of jurisdiction over the case.
However, Oregon’s attorneys also argued for the validity of remaining defenses, such as the claim that the federal Endangered Species Act and Clean Water Act preclude the level of logging sought by the plaintiffs.
Counties turned over the forestlands in the early 20th century in return for a share of timber revenues, but plaintiffs claim Oregon has curtailed logging due to environmental and recreational considerations.
Even if the Oregon’s contract with the counties did require timber revenues to be maximized, that’s no longer possible because federal laws effectively impose limits on logging, said Scott Kaplan, attorney for the state.
“That purpose, if there was such a purpose, can’t be satisfied,” he said.
This defense isn’t valid because the lawsuit only seeks to recover damages for lost revenues from lawfully harvested timber, argued John DiLorenzo, attorney for the plaintiffs.
Oregon’s reduction in timber harvest goes beyond what’s required by federal law, he said. “Honoring federal requirements is built into the calculation of damages.”
Oregon’s “greatest permanent value” rule for managing state forests, enacted in 1998, is blamed by plaintiffs for causing the harvest reductions.
Attorneys for the state government say the “greatest permanent value” rule conforms with Oregon law and the Oregon Department of Forestry is complying with the rule, which is a valid defense to the breach of contract claim.
DiLorenzo said the plaintiffs agree that the Department of Forestry is following the rule, but they simply want to recover damages resulting from that compliance.
“We’re not seeking to void the rules,” he said.