Case 53

Committee to Save the Fox Building v. Birmingham Branch of the Federal Reserve Bank, 497 F. Supp. 504 (N.D. Ala. 1980).

Plaintiff, a citizens' committee, brought suit to enjoin a Federal Reserve bank from demolishing the Fox Building, a building that the bank owned. The bank had acquired the building in 1978 as part of a long-range plan to obtain for future expansion of the bank all properties in the city block that contained the existing bank building and the Fox Building. The Board of Governors of the Federal Reserve System, of which the bank was a member, approved the acquisition in 1975. At the time of the acquisition, the bank was unaware that the Fox Building had any historic significance and so did not consider the architectural and historic impact of the acquisition on the building.

After it had acquired the property, the bank obtained approval from the Board of Governors for funds to demolish the building and began demolition in 1979. The city, however, abruptly suspended the demolition permit so that it could explore alternatives to demolition. During this time, the building was placed on the National Register of Historic Places. Although the city reissued the demolition permit soon after, the bank did not prepare an environmental impact statement under the National Environmental Policy Act (NEPA) and did not attempt to comply with the National Historic Preservation Act (NHPA). Plaintiff sought and obtained a temporary restraining order prohibiting the demolition.

On the merits, the court first held that plaintiff had standing to bring the lawsuit. The imminent demolition of the building constituted sufficient injury within the zone of interests protected by the Federal statutes involved. 497 F. Supp. at 509.

Second, the court found that the Federal Reserve bank was a Federal agency for purposes of NEPA and NHPA because of its own governmental character and because it was required to obtain approvals from the Board of Governors, also a Federal agency, for acquisition and demolition of the building. Id. at 509-10. A Federal Reserve bank, although a separate corporate body, is a fiscal arm of the Federal Government, created and operated in furtherance of national fiscal policy. It is not operated for profit, does not provide ordinary banking services, deposits its surplus earnings in the United States Treasury, and provides various services for the Federal Government. Id. at 510.

Third, although demolition of the building was a "major Federal action" under NEPA because the building was listed in the National Register, plaintiff had not presented evidence sufficient to show that the action would significantly affect the physical environment. Plaintiff showed only an impact on a historically significant building, which the court characterized as a "social concern." The court held that NEPA did not apply in such an instance. Id. at 511.

The court added that even if NEPA did apply, the claim must be dismissed because of laches. Plaintiff had waited almost two years after having at least constructive notice of the project, during which time defendants had spent a considerable sum of money, foregone the opportunity to explore alternate sites, and begun demolition. Plaintiff's delay was inexcusable, and maintenance of the lawsuit would cause undue prejudice to defendants. Id.

Finally, the court concluded that NHPA did not apply because the Fox Building was not listed in the Register at the time that the bank received approval for demolition funds and, although the building satisfied the criteria for eligibility for the Register set out in the Council's regulations, the building was not eligible because no Federal agency or State historical commission had found or determined it to be eligible. Id. at 512. Laches also applied to the NHPA claim. Id. at 513.

The court denied the requested injunctive relief. Id.

Go to Table of Contents Go to Top