On May 27, 2010, the United States District Court for the District of Columbia issued a decision rejecting a challenge to the U.S. Fish and Wildlife Service’s critical habitat determination for the endangered San Diego fairy shrimp, concluding that the Service’s determination was entitled to deference. 

Under the terms of the Endangered Species Act, the Service is required to designate, to the maximum extent practicable, critical habitat for an endangered or threatened species concurrently with a final listing rule.  Critical habitat is defined, in part, as "the specific areas within the geographical area occupied by the species, at the time it is listed . . . ." 

Although the Service issued a final rule listing the San Diego fairy shrimp as endangered on February 3, 1997, it did not issue a final rule designating critical habitat until October 2000.  This designation, however, was short lived, because in response to a legal challenge by several industry groups, the Service sought a voluntary remand for further consideration.  In December 2007, the Service issued a revised final rule designating critical habitat for the fairy shrimp, this time designating, among other tracts of land, approximately 275 acres of land owned by plaintiffs.  

Plaintiffs filed an action challenging the Services second critical habitat designation, asserting that there was no evidence that the fairy shrimp occupied their property in 1997, when the species was listed.  The Court rejected plaintiffs’ challenge, finding that, based on surveys conducted in 2001, and the fairy shrimp’s sedentary life cycle, it was reasonable for the Service to conclude that fairy shrimp occupied the premises in 1997.

Plaintiffs also challenged the critical habitat designation on the basis that the Service failed to properly consider the economic impact of its designation.  Again, however, the Court deferred to the Service’s determination, and upheld the Service’s analysis of the economic impacts of its designation.

The deference shown by the Court in this case is common in much Endangered Species Act litigation, as such litigation often falls under the Administrative Procedure Act, which authorizes a reviewing court to set aside an agency action only if it is "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law."