The opinion of the court was delivered by: MOTLEY
This action arises from the alleged practice of the Tennessee Valley Authority (TVA) of purchasing and using strip-mined coal. In general, strip-mining is a practice of extracting coal by removing the covering top and subsoils, depositing them nearby and then removing the coal from the newly exposed surface. According to plaintiffs, strip-mining directly causes severe water pollution, defaces the land, and renders it useless for recreation, wildlife, timber production or living.
Plaintiffs charge that in purchasing and using strip-mined coal, the TVA has failed to comply with the mandates of the recently enacted National Environmental Policy Act of 1969 (NEPA), 42 U.S.C. § 4321, et seq., in its planning, decision making, and daily administration. Specifically, it is charged that 1) defendants have failed to comply with § 102(2)(C) of NEPA by failing to prepare, circulate and file the requisite environmental impact statement prior to purchasing and using strip-mined coal; 2) defendants have failed to comply with § 102(1) of NEPA by failing to interpret and administer the TVA Act and regulations in a manner consistent with the policies expressed in NEPA; 3) defendants have failed to comply with §§ 102(2)(C)(iii) and 102(2)(D) of NEPA by failing to develop and describe appropriate alternatives to the purchase and use of strip-mined coal and properly evaluate their purchases in light of such alternatives; and 4) defendants have violated § 102(2)(G) of NEPA by failing to develop and use ecological information in the decision to purchase and use strip-mined coal.
The first cause of action alleges these failures of procedure in planning, decision making and administration with respect to a contract by the TVA for the purchase of coal strip-mined from land not owned by TVA; the second cause concerns similar failures with respect to a purchase of strip-mined coal from land owned by TVA. In both of these counts, plaintiffs seek to have the TVA action in awarding the contracts declared illegal, and to have the defendants enjoined from purchasing any coal under the contracts until the requirements of NEPA are met. The third cause of action relates to the TVA's overall policy of purchasing and using strip-mined coal, and similarly seeks to restrain that policy until the requirements of NEPA are met.
The case is now before the court on defendants' motion to dismiss the complaint. The grounds advanced for dismissal are: 1) improper service of process, 2) improper venue, 3) lack of jurisdiction, and 4) failure to join indispensable parties. For the reasons given below, the court finds all of these grounds insufficient and denies defendants' motion. National Audubon Society, Inc., has moved to intervene, and its motion is granted.
Defendants' claim that service of process was improper is totally without merit. Plaintiffs assert, and defendants do not deny, that defendants were duly served by certified mail. Subsection (e) of 28 U.S.C. § 1391 provides that in civil actions "in which each defendant is an officer or employee of the United States or any agency thereof acting in his official capacity or under color of legal authority, or an agency of the United States . . ." service of the summons and complaint to the officer or agency "may be made by certified mail beyond the territorial limits of the district in which the action is brought." That method of delivery is designed to supersede the method specified in Rule 4(d)(5) Fed. R. Civ. P. It is not disputed that TVA is an agency of the United States. The instant action falls within the class of cases described above, so service of process was proper, regardless of whether there is venue in this district. See Brotherhood of Locomotive Engineers v. Denver and Rio Grands R. R. Co., 290 F. Supp. 612, 616 (D. Colo. 1968), affd, 411 F.2d 1115 (10th Cir. 1969); Powelton Civic Home Owners Assoc. v. Department of Housing and Urban Development, 284 F. Supp. 809, 833 (E.D. Pa. 1968).
Defendants contend that the private coal producers who have contracted to sell strip-mined coal to TVA are indispensable parties, and failure to join them should result in dismissal of plaintiffs' complaint. The first two causes of action seek to enjoin TVA performance of contracts made after January 1, 1970, the effective date of NEPA, to purchase strip-mined coal until the requirements of NEPA are met; the third cause of action does not concern any particular contracts, and therefore, cannot he upset for failure to join parties in any case.
The private contractors cannot be joined in this action because they cannot be served. Kentucky Oak Mining Co. is incorporated in Kentucky; W. B. Spradlin Coal Co. and West Coal Company are residents of Tennessee; Falcon Coal Co., agent and attorney in fact for Kentucky Oak Mining Co., is incorporated in Delaware and is doing business in Kentucky. None of these companies is doing business in the Southern District of New York. Since they cannot be joined the court must decide "whether in equity and good conscience the action should proceed among the parties before it, or should be dismissed, the absent person being thus regarded as indispensable." Rule 19(b) Fed. R. Civ. P.
The first factor to consider is whether a judgment rendered in the instant case might be prejudicial to the absent parties. In National Licorice Co. v. NLRB, 309 U.S. 350, 84 L. Ed. 799, 60 S. Ct. 569 (1940), the Supreme Court explicitly recognized that public rights may be vindicated by restraining unlawful actions of a defendant even though the restraint prevented defendant's performance of contracts with third-parties who were not joined in the suit. That case found contracts between an employer and a number of employees to be in violation of the National Labor Relations Act and, therefore, unenforceable by the employer. None of the employees who were parties to the contract were parties to the action. There the action had been brought by the NLRB against the employer to enjoin it from enforcing the illegal contract it had made with its employees.
The Court noted the general rule that where rights arise upon a contract, all of the parties to the contract must be before the court. It then stated:
"But the different considerations may apply even in private litigation where the rights asserted arise independently of any contract which an adverse party may have made with another, not a party to the suit, even though their assertion may affect the ability of the former to fulfill his contract. The rights asserted in the suit and those arising upon the contract are distinct and separate, so that the court may, in a proper case, proceed to judgment without joining other parties to the contract, ...