                              NOT FOR PUBLICATION                        FILED
                    UNITED STATES COURT OF APPEALS                        SEP 13 2017
                                                                      MOLLY C. DWYER, CLERK
                                                                       U.S. COURT OF APPEALS
                              FOR THE NINTH CIRCUIT

UNITED STATES OF AMERICA,                       No.    16-15507

                Plaintiff,                      D.C. No. 3:95-cv-00757-HDM

and
                                                MEMORANDUM *
PYRAMID LAKE PAIUTE TRIBE OF
INDIANS,

      Intervenor-Plaintiff-
      Appellant,

 v.

BOARD OF DIRECTORS OF THE
TRUCKEE-CARSON IRRIGATION
DISTRICT, individually, and as
Representatives of the Class of all Water
Users in the Newlands Reclamation Project
and TRUCKEE-CARSON IRRIGATION
DISTRICT,

                Defendants-Appellees,

DODGE BROTHERS AND DODGE JR.
FAMILY TRUST; et al.,

      Intervenor-Defendants-
      Appellees.


      *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
                 Appeal from the United States District Court
                          for the District of Nevada
              Howard D. McKibben, Senior District Judge, Presiding

             Argued July 13, 2017, Resubmitted September 13, 2017
                           San Francisco, California

Before: GRABER and FRIEDLAND, Circuit Judges, and FOGEL,** District
Judge.

      This is the third appeal in a long-running action by the United States and the

Pyramid Lake Paiute Tribe (the “Tribe”) to recoup water that the Truckee-Carson

Irrigation District (“TCID”) willfully diverted from the Truckee River for

irrigation purposes between 1973 and 1987, in violation of federally imposed

operating criteria and procedures (“OCAP”) and to the detriment of the Tribe.1 See

United States v. Bd. of Dirs. of Truckee-Carson Irrigation Dist. (Bell II), 723 F.3d

1029 (9th Cir. 2013); United States v. Bell (Bell I), 602 F.3d 1074 (9th Cir. 2010).

The remaining dispute concerns only the Tribe’s entitlement to recoupment for




      **
             The Honorable Jeremy D. Fogel, Senior United States District Judge
for the Northern District of California, sitting by designation.
      1
        We need not reprise the history of this long and divisive dispute, which our
court and others have fully recounted on numerous occasions. See, e.g., Nevada v.
United States, 463 U.S. 110 (1983); Pyramid Lake Paiute Tribe of Indians v.
Hodel, 882 F.2d 364 (9th Cir. 1989); Truckee-Carson Irrigation Dist. v. Sec’y of
Dep’t of Interior, 742 F.2d 527 (9th Cir. 1984); United States v. Alpine Land &
Reservoir Co., 697 F.2d 851 (9th Cir. 1983); Pyramid Lake Paiute Tribe of Indians
v. Morton, 354 F. Supp. 252 (D.D.C. 1973).

                                          2
1985 and 1986—an issue we left open in the previous appeal. Bell II, 723 F.3d at

1035. The district court denied any recoupment for those years, based on: (1) its

determination that historic court orders precluded recoupment for certain months

of 1985 and 1986; and (2) its refusal to consider evidence submitted by the United

States and the Tribe to prove the amount of recoupment owed for the remaining

months of those years. We now vacate the district court’s judgment on second

remand and remand for entry of judgment in accordance with this disposition.

      1.     As an initial matter, we reject TCID’s contention that the Tribe is

estopped from raising or has otherwise waived the arguments it now advances.

The doctrine of res judicata does not bar the Tribe from challenging the district

court’s rulings in a direct appeal. 2 See Alaska Airlines, Inc. v. United Airlines,

Inc., 948 F.2d 536, 539-40 (9th Cir. 1991) (“The doctrine of res judicata prohibits

repetitive litigation, not appellate review of claims rejected by the district court.”).

Nor are the Tribe’s arguments foreclosed by the law of the case. We expressly

declined to reach the issues now presented in the previous appeal, 3 Bell II, 723



2
 In any event, the district court’s vacated prior rulings regarding recoupment for
1985 and 1986 have no preclusive effect. See Durning v. Citibank, N.A., 950 F.2d
1419, 1424 n.2 (9th Cir. 1991) (“[A] decision that has been vacated has no
precedential authority whatsoever.”).
3
 Nor were the issues raised in this appeal necessarily decided by implication in
Bell I, as TCID contends. Our recoupment analysis in Bell I focused on the district
court’s failure to account appropriately for the margin of error in certain gauge


                                           3
F.3d at 1035, and we are not bound under that doctrine by the district court’s prior

rulings. See United States v. Cuddy, 147 F.3d 1111, 1114 (9th Cir. 1998) (“The

law of the case doctrine provides that ‘a court is generally precluded from

reconsidering an issue that has already been decided by the same court, or a higher

court in the identical case.’” (quoting United States v. Alexander, 106 F.3d 874,

876 (9th Cir. 1997))). To the extent TCID contends that the Tribe waived its

arguments by failing to raise them in the district court and failing to contest certain

prior rulings of that court, we disagree; the Tribe pursued the same positions in the

district court that it now advocates and could not have challenged that court’s

rulings on those contentions until this appeal.

      2.     The district court held that recoupment was unavailable for any excess

diversions of Truckee River water that occurred (1) from January 15 until

November 15, 1985, and (2) from March 13 until June 30, 1986, because it

interpreted orders issued by United States District Judges Walter E. Craig and

Bruce R. Thompson in 1985 and 1986, respectively, United States v. Orr Water

Ditch Co., Equity No. A-3 (D. Nev. Jan. 15, 1985) (“Judge Craig’s Order”); United

States v. Alpine Land & Reservoir Co., Civil R-183 (D. Nev. Mar. 13, 1986)



readings in calculating its initial recoupment award. 602 F.3d at 1084-86. That
inquiry plainly did not encompass the questions now before us, nor did we
impliedly endorse the recoupment calculation methodology employed at trial to the
exclusion of all other potential, alternative methodologies.

                                           4
(“Judge Thompson’s Order”), as categorically excusing TCID from complying

with applicable OCAP during those periods. That reading is not supported by the

plain language of Judge Craig and Judge Thompson’s Orders, nor does it accord

with the historical context in which those orders issued. We accordingly conclude

that recoupment is available for any excess diversions that occurred during those

portions of 1985 and 1986 in which OCAP were in effect, which includes

(1) March 20 to September 30, 1985, (2) November 15 to December 31, 1985, and

(3) all of 1986.4 In addition, we agree with the district court that recoupment is

available for the period January 1 to January 15, 1985, the date on which Judge

Craig’s Order issued.

      3.     For those portions of 1985 and 1986 in which the district court

concluded recoupment was available, the court nonetheless denied any award

primarily on evidentiary grounds. Specifically, the district court determined that

the United States and the Tribe had not supported their recoupment calculations

with sufficient “evidence that was admitted in the government’s case in chief.”

The United States and the Tribe had put forward expert calculations and supporting

evidence; but the district court refused to consider that submission because the

underlying data came from an exhibit that had only been “admitted for limited



4
 The Tribe does not dispute that there were no OCAP in effect from January 15 to
March 20, 1985, or from September 30 to November 15, 1985.

                                          5
rebuttal purposes” at trial and the calculation methodology was “entirely different”

than that employed at trial—namely, calculation on a monthly, rather than an

annualized, basis. The United States and the Tribe acknowledged as much, but

urged the court to overlook those issues in an exercise of its expansive equitable

authority to fashion relief in this action in equity, particularly given that the district

court’s own ruling limiting recoupment to certain months of 1985 and 1986 had

necessitated a monthly calculation methodology and the exhibit relied on contained

the only monthly data in the trial record. The district court refused to do so.

      That ruling would ordinarily fall well within the district court’s broad

discretion over evidentiary matters, but we have made clear that “this is not

ordinary litigation.” Bell II, 723 F.3d at 1034. Indeed, in the prior appeal, we took

the “extraordinary” step of withdrawing and amending our own mandate to avoid

an inequitable result in this equitable proceeding. See id. The import of that action

was unmistakable: Equity must be done in this action, and it would be inequitable

to bestow a windfall on TCID, “which is at fault for the excess diversions,” to the

detriment of the Tribe and Pyramid Lake, “which the OCAPs are supposed to

protect.” Id.; accord Bell I, 602 F.3d at 1081 (emphasizing that the purpose of the

federal statute that authorizes this recoupment action is “to protect the Tribe’s

enjoyment of Pyramid Lake”). Permitting TCID to escape liability for its repeated

violations of federal law because the case is now in a posture that requires the


                                            6
United States and the Tribe to base any request for recoupment on historical—and

apparently uncontroverted—data that was admitted for a different purpose at trial

plainly contravenes the spirit of Bell II.

      That result would also offend the equitable doctrine of unclean hands, which

“gives wide range to the equity court’s use of discretion in refusing to aid the

unclean litigant.” Precision Instrument Mfg. Co. v. Auto. Maint. Mach. Co., 324

U.S. 806, 815 (1945); id. at 814 (“[H]e who comes into equity must come with

clean hands.”). That doctrine takes on “wider and more significant proportions”

where, as here, “a suit in equity concerns the public interest as well as the private

interests of the litigants.” Id. at 815. The Fallon Paiute Shoshone Indian Tribes

Water Rights Settlement Act of 1990, Pub. L. No. 101-618, 104 Stat. 3289, which

authorizes this suit, was, among other purposes, enacted to “fulfill the goals of the

Endangered Species Act by promoting the enhancement and recovery of the

Pyramid Lake fishery.” Settlement Act § 202(f). Recovery is thus essential to the

public interest as well as the interests of the Tribe. In light of those weighty

equitable considerations and our efforts to ensure that an equitable remedy is

available to the United States and the Tribe throughout the history of this litigation,

it was an error to deny altogether recovery to the United States and the Tribe for

1985 and 1986.

      4.     We have previously remarked on the importance of finality for all


                                             7
interested parties in this litigation, which implicates the competing and significant

interests of the reclamation system, the Tribe, and the environment. See Bell II,

723 F.3d at 1035. To that end, we believe that finally resolving the outstanding

recoupment question is in the best interests of all parties. We have reviewed the

parties’ submissions in our court and the district court, and, exercising our broad

discretionary authority to fashion an equitable remedy, we conclude that the Tribe

is entitled to recoup a total of 8,300 acre-feet of water for the years 1985 and 1986.

That amount is supported by historical data and is the most conservative of the

figures put forward by the United States in the district court. Although it may not

perfectly measure the volume of illegal diversions that may have occurred in 1985

and 1986, we conclude that 8,300 acre-feet is much more likely to be an

underestimate than an overestimate of the amount of water that TCID improperly

diverted and that TCID’s procedural and methodological objections therefore

should not preclude an award in that amount. We also conclude that finality in this

litigation will yield the most equitable result for all parties even if the precise

amount of the award is necessarily imperfect.

      VACATED AND REMANDED for the district court to enter judgment

consistent with this disposition. Costs on appeal shall be awarded to

Appellant.




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