Banks v. United States , 741 F.3d 1268 ( 2014 )

United States Court of Appeals
for the Federal Circuit
______________________
JOHN H. BANKS, ET AL.,
Plaintiffs-Appellants,
v.
UNITED STATES,
Defendant-Appellee.
______________________
2012-5067
______________________
Appeal from the United States Court of Federal
Claims in consolidated Nos. 99-CV-4451, 99-CV-4452, 99-
CV-4453, 99-CV-4454, 99-CV-4455, 99-CV-4456, 99-CV-
4457, 99-CV-4458, 99-CV-4459, 99-CV-44510, 99-
CV44511, 99-CV-44512, 00-CV-365, 00-CV-379, 00-CV-
380, 00-CV-381, 00-CV-382, 00-CV-383, 00-CV-384, 00-
CV-385, 00-CV-386, 00-CV-387, 00-CV-388, 00-CV-389,
00-CV-390, 00-CV-391, 00-CV-392, 00-CV-393, 00-CV-394,
00-CV-395, 00-CV-396, 00-CV-398, 00-CV-399, 00-CV-400,
00-CV-401, 05-CV-1353, 05-CV-1381, and 06-CV-072,
Chief Judge Emily C. Hewitt.
______________________
Decided: January 28, 2014
______________________
EUGENE J. FRETT, Sperling & Slater, P.C., of Chicago,
Illinois, argued for plaintiffs-appellants. Of counsel on
the brief were MARK E. CHRISTENSEN, Christensen &
BANKS v. US 2
Ehret, LLP, of Chicago, Illinois, and JOHN EHRET, of
Olympia Fields, Illinois.
ELIZABETH ANN PETERSON, Attorney, Environment &
Natural Resources Division, United States Department of
Justice, of Washington, DC, argued for defendant-
appellee. With her on the brief was IGNACIA S. MORENO,
Assistant Attorney General.
BRIAN T. HODGES, Pacific Legal Foundation, of
Bellevue, Washington, and R.S. RADFORD, of Sacramento,
California, for amicus curiae Pacific Legal Foundation.
______________________
Before RADER, Chief Judge, LINN, and WALLACH, Circuit
Judges.
WALLACH, Circuit Judge.
These consolidated individual actions were brought by
thirty-seven lakefront property owners seeking just
compensation under the Fifth Amendment of the United
States Constitution for a partial physical taking of their
respective properties by the United States Army Corps of
Engineers (“Corps”). The United States Court of Federal
Claims dismissed the actions as time-barred. Because the
Court of Federal Claims violated this court’s mandate in
Banks v. United States (Banks II), 314 F.3d 1304, 1310
(Fed. Cir. 2003), and clearly erred in finding that
Appellants knew or should have known of their claims
before 1952, the Court of Federal Claims’ dismissal is
reversed.
BACKGROUND
I. The St. Joseph Harbor Jetties
Beginning in the 1830s, the Corps began constructing
two major harbor jetties on Lake Michigan near the St.
Joseph River. These jetties protrude outward from the
BANKS v. US 3
mouth of the river into the body of the lake. They were
periodically extended until 1903, when they reached their
current length. After 1903, major construction on the
jetties ceased until 1950, when the Corps began a project
to encase the jetties in steel-sheet piling. This project was
completed in 1989.
Appellants (also referred to as “Plaintiffs”) are
landowners along approximately four and one-half miles
of the eastern shore of Lake Michigan, south of the jetties.
This shoreline is eroding naturally, but Appellants allege
the jetties block the flow of sand and sediment from the
river and the lakeshore north of their properties.
Specifically, they argue that the structures interrupt the
natural littoral drift within the lake, leading to increased
erosion on their properties, amounting to an unlawful
taking under the Fifth Amendment.
The Corps has also been concerned with erosion along
the Lake Michigan shoreline. In 1958, the Corps released
a “Beach Erosion Control Study” (the “1958 Study”) that
examined the effects of beach erosion on Berrien County,
Michigan, where the St. Joseph jetties are located. This
Report documented increased erosion in certain areas as a
result of the jetties and recommended that a nourishment
program “be initiated at the earliest practicable date.”
J.A. 5939. This program did not target Appellants’ land
because the land was then private and ineligible for
federal funding. Nonetheless, the project was expected to
benefit them by “restoration of normal littoral drift” in the
area. J.A. 5959.
In 1968, Congress enacted the “Rivers and Harbors
Act,” which authorized the Secretary of the Army to
“investigate, study, and construct projects for the
prevention or mitigation of shore damages attributable to
Federal navigation works.” River and Harbor Act of 1968,
Pub. L. No. 90-483, § 111, 82 Stat. 731, 735 (1968)
(codified as amended at 33 U.S.C. § 426i (2012)).
BANKS v. US 4
Pursuant to this authority, the Corps proposed a plan to
mitigate the erosion caused by the jetties by dumping
sand into feeder beaches located to the north of
Appellants’ properties. This endeavor was projected to
“provide the quantities of littoral material interrupted by
the [jetties] to the shores downdrift.” J.A. 5061.
Implemented in 1976, the mitigation plan “involved
placing fine sand from the harbor maintenance dredging
on the downdrift [southerly] beaches.” Banks v. United
States (Banks I), 49 Fed. Cl. 806, 818 (2001), rev’d, 314
F.3d 1304 (Fed. Cir. 2003) (internal quotation marks and
citation omitted). After fifteen years of beach
nourishment, the mitigation efforts shifted to using
coarser sediment, in the hope it would have a longer
retention time than fine sand. Eventually, in 1995, the
Corps dumped “barge-loads of large rocks into the lake.”
Id. at 819.
In relation to these projects, the Corps released a
series of reports in 1973, 1996, 1997, and 1999 on the
erosive effects of the jetties and the progress of mitigation
efforts. There is also an April 20, 1998, newspaper article
relating to the erosion.
The 1973 Report “has been described, without
contradiction, ‘as the first credible look at the St. Joseph
Harbor structures in estimating the total amount of
material trapped in the structures.’” Banks v. United
States, 78 Fed. Cl. 603, 612 (2007) (“Liability Op.”). The
Corps started implementing mitigation programs after
this Report.
The 1996 Report concluded that the St. Joseph
shoreline was “in a state of recession” and that the erosion
that occurs during lakebed downcutting 1 is “permanent.”
1 Downcutting is explained as follows: “If the sand
cover to glacial till is depleted, the energy of the waves
and the shifting of the sand, which acts as ‘sandpaper,’
BANKS v. US 5
Larry E. Pearson, Andrew Morang & Robert B. Nairn,
U.S. Army Corps of Engineers, Geologic Effects on
Behavior of Beachfill and Shoreline Stability for
Southeast Lake Michigan 9, 48 (1996) (“1996 Report”).
However, the Report also indicated uncertainty regarding
the effects of mitigation efforts: the mitigation program
“may provide at least partial protection to the underlying
glacial till along and offshore of the feeder beach and the
waterworks revetment section of shore. It is unclear
whether the beach nourishment is having any negative or
positive impact along the 3.5-km revetment section of
shoreline south of the waterworks.” Id. at 49; see also
Banks II, 314 F.3d at 1307.
The 1997 Report observed that some areas were
benefitting from nourishment but in other areas the
results were “questionable.” J.A. 5516. The 1999
Report—made public in 2000—identified Lake Michigan
as a cohesive, rather than sandy, shoreline, and stated
that “‘[e]rosion of the consolidated layer [underlayer of a
cohesive coastline] is generally irreversible.’” 2 Banks I, 49
can cause the lake bottom to erode and thus lower in a
process referred to as ‘downcutting.’” Liability Op., 78
Fed. Cl. at 622.
2 “The composition of the lakebed is relevant because
the composition affects erosion and mitigation processes.”
Liability Op., 78 Fed. Cl. at 622. A sandy lakebed is made
up of materials that are loosely deposited, or easily
dispersed. Id. at 621. Thus, according to the
Government’s expert, “as long as the sand supply south of
the harbor is restored to the pre-harbor levels, then we
can assume directly that the erosion will remain the same
as pre-harbor levels, all other things aside.” Id. (internal
quotation marks and citation omitted). Conversely, in a
cohesive lakebed, the materials are bound together and
are not “freely mobile.” Id. (internal quotation marks and
citation omitted). Cohesive shores are thus “more
BANKS v. US 6
Fed. Cl. at 823 (quoting J.A. 5637). The 1999 Report also
found that the effects of the nourishment programs were
limited because the programs were based on the
assumption that the coastline was sandy, with an
unlimited sand supply, and not cohesive. Appellants
relied on the 1999 Report in arguing their claims were not
time-barred and stated that “the language in this [R]eport
is the first clear indication of permanent damage caused
by the harbor structures.” Id. (internal quotation marks
and citation omitted).
II. Procedural History
This case began in 1999, when a majority of
Appellants filed suit in the Court of Federal Claims
against the Government claiming an unconstitutional
taking under the Fifth Amendment. 3 See 28 U.S.C.
§ 1491 (1994). In 2001, the Government filed a Motion to
Dismiss the Complaint as being time-barred. There was
already a “well-developed” evidentiary record before the
complicated” because the “sand acts to abrade, sort of like
sandpaper, the till.” Id. at 622 (internal quotation marks
and citation omitted). However, “[t]here’s no scientific
knowledge as to . . . when you increase your erosion and
when you may decrease your erosion.” Id. In any event,
“what’s critical about till downcutting is . . . [o]nce it
erodes, it does not recover.” Id. Stated simply, if a
shoreline is sandy, mitigation will be more successful
than if the shoreline is cohesive.
3 The original July 9, 1999, Complaint was filed on
behalf of a “proposed class” of “approximately 200
landowners who own the shoreline property in the area
extending 53,000 feet south from the St. Joseph Harbor
jetties.” J.A. 4939. The Court of Federal Claims denied
class certification, and the thirty-seven Plaintiffs in this
action filed separate Complaints. Appellants’ counsel
treats the allegations in the Complaints as the same. See
Banks I, 49 Fed. Cl. at 808.
BANKS v. US 7
court because the parties had been preparing for trial.
Banks I, 49 Fed. Cl. at 809 n.4. Appellants also offered
expert testimony from Dr. Guy Meadows, a mechanical
engineering professor at the University of Michigan.
The Court of Federal Claims granted the Motion and
dismissed for lack of subject matter jurisdiction, finding
that the claims had accrued in 1989 and were therefore
barred by the Tucker Act’s six-year statute of limitations.
Id. Appellants appealed, and this court reversed and
remanded in 2003, holding that Appellants’ claims did not
materialize until 2000, when the Corps’ Reports
“collectively indicated that the erosion was permanent
and irreversible.” Banks II, 314 F.3d at 1310.
Specifically, this court held: “We are satisfied that the
[P]laintiffs met their jurisdictional burden before the
Court of Federal Claims.” Id.On remand, the Court of Federal Claims held
separate trials on liability and damages. On June 4,
2007, the case proceeded to the trial on liability. Liability
Op., 78 Fed. Cl. 603. The primary issues addressed were:
(1) the zone of influence of the jetties and whether
Appellants’ properties were located within that zone; (2)
whether the composition of the lakebed adjacent to the
property was sandy or cohesive; and (3) the effectiveness
of the beach nourishment mitigation program. Id. at 613–
14. The Court of Federal Claims concluded that, contrary
to the allegations in Appellants’ Complaints, the jetties
were impermeable to sand before they were encased in
steel. See id. at 636. The court also found that the
United States was liable for 30% of erosion between 1950
and 1970, after each owner’s acquisition of his or her
property. It held that, after 1970, the United States was
responsible for 30% of any losses to erosion that had not
been effectively mitigated. Id. at 656. In so concluding,
the Court of Federal Claims “heard testimony from 22
witnesses and received some 75 exhibits into evidence.”
Id. at 608.
BANKS v. US 8
Following the Liability Opinion, Appellants made
additional motions, including a Motion in Limine based
on the law-of-the-case doctrine to preclude (1) all evidence
that the erosion suffered by Appellants was not
permanent and irreversible; and (2) evidence relating to
the composition of the nearshore lakebed adjacent to
Appellants’ properties. J.A. 1859. The Court of Federal
Claims denied the Motion as to both requests. Appellants
also moved to clarify the measure of damages. The court
granted the motion to clarify and modified its ruling,
finding “that property owners at the time of the taking
are entitled to compensation for ‘all damages, past,
present, and prospective.’” J.A. 1755 (internal citation
omitted). The court then held a trial on damages from
April 18–21, 2011, and from April 25–28, 2011. Banks v.
United States (Banks III), 102 Fed. Cl. 115, 120 (2011).
After the Court of Federal Claims conducted the
damages trial, it found there was “a jurisdictional issue
that arose in connection with its drafting of the trial
opinion.” Banks v. United States, 99 Fed. Cl. 622, 623
(2011) (opinion requesting additional briefing). The court
then directed the parties to file additional briefing
addressing whether the Court of Federal Claims had
jurisdiction to hear Appellants’ claims. Id. at 626.
Specifically, the court asked the parties to brief the
following two questions:
1) Given the court’s finding after the trial of
liability that the jetties were impermeable to sand
before they were encased in steel sheet piling, and
given the Corps’ acknowledgement of the
erosional impact of “harbor structures” in the
1958 Study, on what date did [P]laintiffs’ claims
accrue? Does the court possess subject matter
jurisdiction to hear [P]laintiffs’ claims?
2) Does the Federal Circuit’s determination that
[P]laintiffs’ claims accrued with the publication of
three Corps [R]eports on mitigation constitute the
BANKS v. US 9
“law of the case” which may not be disturbed by
the court notwithstanding inconsistent factual
findings of the court after trial?
Id.
Following the supplemental briefing, on December 22,
2011, the Court of Federal Claims again found it lacked
jurisdiction. The court additionally presented findings “in
the alternative” on the merits of the case, stating if “any
appeal should disagree with the court’s view of its
jurisdiction, and to avoid the possibility . . . of a repetitive
trial, the court also presents here its findings from the
trial.” Banks III, 102 Fed. Cl. at 120. 4
Appellants timely appealed. This court has
jurisdiction pursuant to 28 U.S.C. § 1295(a)(3) (2012).
DISCUSSION
The principal issues on appeal are (1) whether this
court’s opinion in Banks II precluded the Court of Federal
Claims from reconsidering when Appellants’ claims
accrued for the purposes of subject matter jurisdiction,
and (2) whether Appellants knew or should have known
that their claims accrued by 1952.
Specifically, the Court of Federal Claims held:
4
Since 1970, the Corps’ mitigation efforts have
prevented the jetties from causing erosion to
[P]laintiffs’ properties, with one exception.
Further, [P]laintiffs have failed to prove, with
regard to any of [P]laintiffs’ properties—whether
by comparing the cost of shore protection to the
dollar amount of their reasonably foreseeable
damages or by some other means—that the
installation of shore protection would be sound
economy.
Banks III, 102 Fed. Cl. 115.
BANKS v. US 10
I. Standard of Review
This court reviews legal holdings de novo and
examines factual findings for clear error. Bell BCI Co. v.
United States, 570 F.3d 1337, 1340 (Fed. Cir. 2009).
“[T]he interpretation by an appellate court of its own
mandate is properly considered a question of law,
reviewable de novo.” Laitram Corp. v. NEC Corp., 115
F.3d 947, 950 (Fed. Cir. 1997). A dismissal for lack of
jurisdiction by the court below is also a legal conclusion
reviewed de novo. Tex. Peanut Farmers v. United States,
409 F.3d 1370, 1372 (Fed. Cir. 2005).
II. Subject Matter Jurisdiction
The Tucker Act allows plaintiffs to sue the United
States for claims founded upon the Constitution, Acts of
Congress, agency regulations, contracts with the United
States, “or for liquidated or unliquidated damages in
cases not sounding in tort.” 28 U.S.C. § 1491. Title 28
U.S.C. § 2501 limits this allowance to a period of six
years. The six-year limitation operates as a suspension of
sovereign immunity, because without explicit
Congressional authorization, the United States may not
be sued. United States v. Mitchell, 463 U.S. 206, 212
(1983) (“It is axiomatic that the United States may not be
sued without its consent and that the existence of consent
is a prerequisite for jurisdiction.”); United States v.
Sherwood, 312 U.S. 584, 586 (1941). Thus, the statute’s
six-year time frame is a limited jurisdictional window in
which plaintiffs have the ability to bring a claim against
the Government. 28 U.S.C. §§ 1491, 2501.
III. The Mandate Rule
The law-of-the-case doctrine “posits that when a court
decides upon a rule of law, that decision should continue
to govern the same issues in subsequent stages in the
same case.” Christianson v. Colt Indus. Operating Corp.,
486 U.S. 800, 815–816 (1988) (internal quotation marks
BANKS v. US 11
and citation omitted). The rule encourages both finality
and efficiency in the judicial process by preventing
relitigation of already-settled issues. Id. at 816. The
mandate rule, encompassed by the broader law-of-the-
case doctrine, dictates that “an inferior court has no
power or authority to deviate from the mandate issued by
an appellate court.” Briggs v. Pa. R. Co., 334 U.S. 304,
306 (1948); see also Cent. Soya Co. v. Geo. A. Hormel &
Co., 723 F.2d 1573, 1580 (Fed. Cir. 1983) (explaining that
the law-of-the-case doctrine was “judicially created to
ensure judicial efficiency and to prevent the possibility of
endless litigation”). Once a question has been considered
and decided by an appellate court, the issue may not be
reconsidered at any subsequent stage of the litigation,
save on appeal. Cf. In re Sanford Fork & Tool Co., 160
U.S. 247, 255 (1895) (“Whatever was before [the Supreme
Court], and disposed of by its decree, is considered as
finally settled. . . . If the circuit court mistakes or
misconstrues the decree of this court, and does not give
full effect to the mandate, its action may be controlled . . .
upon a new appeal.”).
Under the mandate rule, a court below must adhere to
a matter decided in a prior appeal unless one of three
“exceptional circumstances” exist: (1) subsequent evidence
presented at trial was substantially different from the
original evidence; (2) controlling authority has since made
a contrary and applicable decision of the law; or (3) the
decision was clearly erroneous “and would work a
manifest injustice.” Gindes v. United States, 740 F.2d
947, 950 (Fed. Cir. 1984) (internal quotation marks and
citation omitted). This rule is limited to issues “actually
decided, either explicitly or by necessary implication” in
the previous litigation. Toro Co. v. White Consol. Indus.,
Inc., 383 F.3d 1326, 1335 (Fed. Cir. 2004).
Appellants’ first jurisdictional argument is that the
Court of Federal Claims violated this court’s mandate and
that none of the three exceptions gave it the power to do
BANKS v. US 12
so. The Government counters that the Court of Federal
Claims “correctly concluded that the issue here—whether
Banks knew or should have known of the claims before
the refurbishment and mitigation projects were
undertaken in the 1950s and 1970s—was not considered
or decided by this Court in Banks II.” Appellee’s Br. 30.
To determine whether this court’s mandate in
Banks II was violated, its scope must first be established.
The Banks II court prefaced the analysis by stating its
focus: “The issue before this court on appeal is whether
the Court of Federal Claims erred in finding that the
[P]laintiffs’ claims fell outside the applicable statute of
limitations.” Banks II, 314 F.3d at 1308. After applying
the analogous case of Applegate v. United States, 25 F.3d
1579 (Fed. Cir. 1994), the court held that:
We are satisfied that the [P]laintiffs met their
jurisdictional burden before the Court of Federal
Claims on the basis of the justifiable uncertainty
of the permanence of the taking caused by the
actual mitigation efforts of the Corps. The statute
of limitations did not begin to run until the Corps
issued the 1996, 1997, and 1999 Reports. Because
each [R]eport was issued less than six years
before [P]laintiffs filed their [C]omplaints, each
[C]omplaint was timely.
Banks II, 314 F.3d at 1310 (citation omitted).
On remand, the Court of Federal Claims again
dismissed the case, finding Appellants’ Complaints were
untimely. It held its dismissal was not barred by the
mandate rule, on the ground that this court’s decision did
not address “whether [P]laintiffs’ claims accrued before
the [G]overnment made its first promises of mitigation.”
Banks III, 102 Fed. Cl. at 150. Finding that “the jetties
were impermeable to sand before they were encased in
steel sheet piling,” id. at 131, the Court of Federal Claims
held the Appellants’ claims accrued before 1952 and
BANKS v. US 13
dismissed the case for want of jurisdiction. The Court of
Federal Claims found that for Appellants’ claims to have
been timely filed, the erosion must have stabilized after
1952, six years before the 1958 Study, which Appellants
argued created justifiable uncertainty about the
permanence of the taking. Id. at 133–34.
The Government argues that Banks II never decided
whether the claims accrued before 1952, because both this
court and the Court of Federal Claims “accepted as true
the allegations of the Complaints, including the allegation
that the jetties caused no damage before 1950.”
Appellee’s Br. 31–32. The Government therefore contends
that the Court of Federal Claims did not violate the
mandate rule when it considered that issue on remand.
The problem with the Government’s position is that
neither the Court of Federal Claims nor this court
accepted as true all the allegations in Appellants’
Complaint. When reviewing a motion to dismiss for lack
of subject matter jurisdiction, a court accepts only
uncontroverted factual allegations as true for purposes of
the motion. Gibbs v. Buck, 307 U.S. 66, 72 (1939). “If a
motion to dismiss for lack of subject matter jurisdiction,
however, challenges the truth of the jurisdictional facts
alleged in the complaint, the district court may consider
relevant evidence in order to resolve the factual dispute.”
Reynolds v. Army & Air Force Exch. Serv., 846 F.2d 746,
747 (Fed. Cir. 1988); see also Engage Learning v. Salazar,
660 F.3d 1346, 1355 (Fed. Cir. 2011); Cedars-Sinai Med.
Ctr. v. Watkins, 11 F.3d 1573, 1584 (Fed. Cir. 1993). In
such cases, the plaintiff has the burden of proving subject
matter jurisdiction by a preponderance of the evidence.
Reynolds, 846 F.2d at 748 (citing Zunamon v. Brown, 418
F.2d 883, 886 (8th Cir. 1969)). Additionally, “[i]f the Rule
12(b)(1) motion [to dismiss] denies or controverts the
pleader’s allegations of jurisdiction . . . the movant is
deemed to be challenging the factual basis for the court’s
BANKS v. US 14
subject matter jurisdiction.” Cedars-Sinai Med. Ctr., 11
F.3d at 1583.
In Banks I, the Court of Federal Claims stated that
“[b]ecause the parties were preparing for trial at the time
[D]efendant filed its [M]otion to [D]ismiss, the evidentiary
record is well-developed. The court has before it the
anticipated trial exhibits prepared by the parties and filed
in accordance with the pre-trial scheduling order.” Banks
I, 49 Fed. Cl. at 809 n.4. The court then explained that
“Plaintiffs cannot rely merely on the allegations in the
[C]omplaint. Because [P]laintiffs bear the burden of proof
by a preponderance of the evidence, they must offer
relevant, competent evidence to show that they filed suit
within six years of the accrual of their claims.” Id. at 809
(internal citation omitted). Explicitly looking outside of
the Complaint, the court granted the Government’s
Motion to Dismiss, stating: “The court observes that
[P]laintiffs’ claims that they were uncertain about the
permanence of the erosion damage until 1999 are
contradicted by their own evidence.” 5 Id. at 824.
Holding those findings were clearly erroneous and
that Appellants’ claims did not accrue until 2000, the
Banks II court relied on the technical Reports, not solely
on the Appellants’ allegations in the Complaint. It is
simply inaccurate to claim that the factual allegations of
the Complaint were taken as true by either court.
Banks II did not “leave open” the issue of when
Plaintiffs’ claims accrued. The Banks II court held the
Complaints were not barred by the six-year statute of
5 The Banks II court stated that the 1996, 1997, and
1999 Reports were all in evidence before the Court of
Federal Claims. Banks II, 314 F.3d at 1307 (explaining
“[t]he evidence before the Court of Federal Claims
included three technical [R]eports issued by the Corps”).
BANKS v. US 15
limitations. Necessary and predicate to the holding was a
finding that the mitigation efforts delayed claim accrual.
Because the Banks II mandate decided the accrual
date, the Court of Federal Claims was permitted to revisit
this issue only if one of the three exceptions to the
mandate rule applied. The Court of Federal Claims did
not find, and the Government did not argue, that the
Banks II decision was clearly erroneous or that there was
a change in controlling precedent. Thus, only the third
exception—whether subsequent evidence presented at
trial was substantially different from the original
evidence—is relevant.
The Government contends that the “most persuasive
evidence that the jetties had caused erosion of the Banks
properties” was the 1958 Study, which was admitted in
July 2007, six years and four years after Banks I and
Banks II, respectively. Appellee’s Br. 34 (citing Banks III,
102 Fed. Cl. at 134). Appellants respond that “the
evidence is not new, and far from being substantially
different, is merely cumulative of the jurisdictional
evidence that was before this [c]ourt.” Appellants’ Br. 27.
When a party offers additional evidence that is
consistent with previously-offered evidence, but is not
new or different in any real sense, a court should decline
the invitation to revisit its previous determination. See
Intergraph Corp. v. Intel Corp., 253 F.3d 695, 698 (Fed.
Cir. 2001) (noting that the district court stated,
“[a]lthough Intergraph may have obtained more evidence
related to the FTC’s actions, the Federal Circuit was
certainly aware of the actions”); see also United States v.
Bartsh, 69 F.3d 864, 867 (8th Cir. 1995) (finding that the
Appellant presented “no new substantive evidence, but
merely a recalculation of the same evidence that was
offered at the sentencing hearing”). In the instant case,
while the Court of Federal Claims may have examined
the evidence more thoroughly in the bifurcated liability
BANKS v. US 16
and damages trial, all of it was consistent with evidence
that was before both the Court of Federal Claims on the
Government’s Motion to Dismiss and this court on appeal
in 2003.
The evidence before the Court of Federal Claims after
this court’s mandate issued was not “new” but merely
cumulative of evidence before it in 2001. The evidentiary
record before the Court of Federal Claims in 2001
included the 1996, 6 1997, 7 and 1999 8 Reports, a 1998
newspaper article, 9 and evidence from Plaintiffs’ expert,
6 The 1996 Report, in relevant part, states that the
shoreline is in recession and that “[e]vidence has been
presented by Buckler (1981) showing a southward
progression of increased erosion rates since at least 1829.
Further studies by Buckler and Winters (1983) revealed
average bluff recession rates for the area between St.
Joseph and Shoreham of approximately 0.6 m/year
between 1829 and 1977.” J.A. 5031 (emphases added).
7 The 1997 Report makes similar findings: “The
harbor jetties were constructed originally in 1903 and
have been estimated to trap approximately 84,000 [cubic
meters] of sediment per year.” J.A. 5434.
8 The 1999 Report similarly states “the removal of
sand from the littoral transport system has been
occurring from the time of construction; in some cases for
over one hundred years.” J.A. 5637 (emphasis added).
9 In the record, and cited by the Court of Federal
Claims in 2001, was also a 1998 newspaper article from
the Herald-Palladium, titled “Too soon to tell if erosion
experiment will help.” The article, quoting a physical
scientist for the Corps, Charles Thompson, stated: “the
project began only in the early 1970’s so basically we have
80, 90, or 100 years of non-mitigation to make up for. . . .
For most of the life of the St. Joseph’s Harbor structures
[jetties], little was done to mitigate the effects of those
BANKS v. US 17
Dr. Meadows, 10 all of which contained information similar
to that in the 1958 Study.
The sum of that evidence is that erosion has been
occurring since at least 1903. The evidence was not only
before the Court of Federal Claims in Banks I; the court
referred to, and relied upon, it extensively. The same
evidence was before this court in 2003, as evidenced by
the fact that the basis for this court’s opinion in Banks II
was the 1996, 1997, and 1999 Reports. This court is not
persuaded that any “new” evidence required reexamining
jurisdiction that had already been decided by this court.
In evaluating the scope of the mandate, the actions of
the Court of Federal Claims must not be inconsistent with
the letter or spirit of the mandate. Engel Indus. Inc. v.
Lockformer Co., 166 F.3d 1379, 1383 (Fed. Cir. 1999).
Indeed, “all issues within the scope of the appealed
judgment are deemed incorporated within the mandate
and thus are precluded from further adjudication.” Id. at
1383. The broad mandate issued by this court found that
Appellants’ claims did not accrue until the 1996, 1997,
and 1999 Reports. This decision necessarily decided that
structures.” Banks I, 49 Fed. Cl. at 821 (internal
quotation marks and citation omitted).
10 The Court of Federal Claims also cited to testimony
from Dr. Meadows that the jetties had been causing
erosion since their completion in 1903. Specifically, Dr.
Meadows testified that:
The harm that has been done is the accumulated
harm since 1903 [(the construction date of the
harbor jetties)]. That structure has done two
things. It has blocked the shore parallel transport
of material from north to south and it has also
deflected some of that material offshore and,
hence, being lost forever once it’s beyond the
depth of closure.
Banks I, 49 Fed. Cl. at 817 (citation omitted).
BANKS v. US 18
the claims did not accrue prior to 1952. The Court of
Federal Claims’ Banks III holding that the claims accrued
before that time is therefore reversed.
IV. Accrual Suspension
The Court of Federal Claims further erred in its
analysis of accrual suspension. The accrual of a claim
against the United States is suspended, for purposes of 28
U.S.C. § 2501, until the claimant knew or should have
known that the claim existed (“the accrual suspension
rule”). Boling v. United States, 220 F.3d 1365, 1373 (Fed.
Cir. 2000) (finding that, when determining when a taking
claim accrues, “the key issue is whether the permanent
nature of the taking was evident such that the landowner
should have known that the land had suffered erosion
damage”); Hopland Band of Pomo Indians v. United
States, 855 F.2d 1573, 1577 (Fed. Cir. 1988); Kinsey v.
United States, 852 F.2d 556, 557 n.* (Fed. Cir. 1988) (“A
claim does not accrue unless the claimant knew or should
have known that the claim existed.”); see also Holmes v.
United States, 657 F.3d 1303, 1322 n.15 (Fed. Cir. 2011).
For the accrual suspension rule to apply, the claimant
“must either show that the defendant has concealed its
acts with the result that plaintiff was unaware of their
existence or it must show that its injury was ‘inherently
unknowable’ at the accrual date.” Young v. United States,
529 F.3d 1380, 1384 (Fed. Cir. 2008) (quoting Martinez v.
United States, 333 F.3d 1295, 1319 (Fed. Cir. 2003) (en
banc)). The inherently unknowable test “includes a
reasonableness component.” Holmes, 657 F.3d at 1320(“While we have stated that the ‘concealed or inherently
unknowable’ formulation of the test for accrual
suspension is ‘more common and more precise’ than the
‘knew or should have known’ formulation, we do not view
that statement as eschewing the reasonableness
component of the ‘inherently unknowable’ prong of the
test.”) (internal citation omitted).
BANKS v. US 19
The Court of Federal Claims found that Appellants’
argument relating to accrual suspension based on the
overruling of adverse precedent was waived because they
did not raise it in their opening brief to that court. In the
alternative, the court held that the accrual suspension
rule was “inapplicable to [P]laintiffs’ claims.” Banks III,
102 Fed. Cl. at 144. On appeal, Appellants argue that
accrual suspension should apply because they “should not
reasonably have been expected to know that jetty-caused
erosion was significantly damaging their properties until
1997.” Appellants’ Br. 23. The Government contends
that Appellants “now raise[ ] a second accrual suspension
argument that was not raised in the [Court of Federal
Claims]” and that argument is waived. Appellee’s Br. 40.
Appellants have not waived their accrual suspension
arguments. The Court of Federal Claims cited
Appellants’ argument “that as late as 1997 it was not
understood that the harbor jetties caused increased
erosion in [P]laintiffs’ zone. The implication of
[P]laintiffs’ argument is that their claims stabilized no
earlier than 1997 because it was not understood at that
time that the jetties were causing erosion in [P]laintiffs’
zone.” Banks III, 102 Fed. Cl. at 141. Though Banks did
not use the term “accrual suspension” in making this
argument, the substance is the same as that which it
argues before this court. Accordingly, the argument is not
waived.
The Court of Federal Claims held that “erosion caused
by the jetties in [P]laintiffs’ zone was a longstanding
problem by 1952, beginning as early as 1903,” id. at 138,
and that the forty-nine-year passage of time and “well-
documented” erosion would have made it “clear to a
reasonable landowner . . . that the [G]overnment had
effected a permanent taking,” 11 id. at 140. Appellants
11The Court of Federal Claims found that “[d]uring
the forty-nine years between 1903, when the jetties
BANKS v. US 20
argue that they could not have known they had a takings
claim until 1997, when the 1997 Report issued. The
Government counters that Appellants’ claims were not
“inherently unknowable” and that they should have
known about the erosion as early as 1950.
When there is a gradual physical process, such as
erosion or flooding, the “stabilization doctrine” delays
claim accrual until the situation has “stabilized.” See
United States v. Dickinson, 331 U.S. 745, 749 (1947).
Thus, the statute of limitations under the Tucker Act only
begins to run when it “becomes clear that the gradual
process set into motion by the [G]overnment has effected
a permanent taking, not when the process has ceased or
when the entire extent of the damage is determined.”
Boling, 220 F.3d at 1370–71.
In making the determination of permanence, a court
considers “the uncertainties of the terrain, the difficulty
in determining the location of the government’s easement,
and the irregular process of erosion.” Id. at 1373. Claims
are deemed to accrue once the damage has “substantially
encroached the parcels at issue and the damages were
reasonably foreseeable.” Id.The Government argues that even if Appellants
inferred from the various Corps Reports that the jetties
had not caused the specific damage to their properties,
“[they] w[ere] on notice of the well-documented connection
between the jetties and erosion along the shore.”
Appellee’s Br. 46. Likewise, the Court of Federal Claims
implies that Appellants knew or should have known that
the jetties were causing erosion because of the “general
reached their final length, and 1952, the jetties were
responsible for 25% of the material eroded from Dr.
Nairn’s study area, the ten mile segment of shoreline
south of the jetties.” Banks III, 102 Fed. Cl. at 140.
BANKS v. US 21
pattern of erosion that followed the lengthening of the
jetties in 1903.” Banks III, 102 Fed. Cl. at 140.
Two factors complicate determining when Appellants
knew or should have known of their alleged takings
claims. First, the shorelines of Appellants’ properties are
subject to natural erosion and other natural fluctuations.
As this court found in Banks II, “without human
intervention, [erosion] occurs naturally at a rate of
approximately one foot per year.” 314 F.3d at 1306.
Furthermore, Lake Michigan is subject to “[s]hort period
fluctuations up to about 1.8 feet, caused by winds and
differences in barometric pressures, [which] occur with
annual frequency.” J.A. 5939. Waves and storms also
affect the shorelines: “Waves from both the northwest and
southwest quadrants cause movement of beach material,
but as evidenced by the much greater accumulation of
beach material north of the St. Joseph Harbor structures,
the predominant direction of littoral transport is
southward.” Id. The Government’s own expert, Dr.
Robert Nairn, a coastal engineer, testified that the slow
process of erosion is “masked by far larger swings in the
width of the beaches next to [P]laintiffs’ properties caused
by cross-shore sand transport, a cyclical process by which
sand is moved offshore during times of high lake levels
and returned to the shore during times of low lake levels.”
Banks III, 102 Fed. Cl. at 121.
That the Plaintiffs were aware of some erosion is not
sufficient for the claim to accrue. See Nw. La. Fish &
Game Pres. Comm’n v. United States, 446 F.3d 1285, 1291
(Fed. Cir. 2006) (explaining because some growth of
hydrilla is normal, the damage to Plaintiffs was not
known until there was uncontrolled overgrowth and the
Corps issued a final refusal to lower the water level).
Indeed, the Corps itself stated that only 30% of the
damage to Appellants’ shorelines was attributable to the
Corps’ activity, meaning 70% of the damage to the subject
properties was attributable to naturally occurring erosion.
BANKS v. US 22
J.A. 5770. Accordingly, it is unreasonable to assume that
a property owner should have been able to discern the
difference between the naturally occurring erosion and
that caused by the jetties.
As found by this court in Banks II, Appellants could
not reasonably have known the damage was “permanent”
until the Corps issued its 1996, 1997, and 1999 Reports
showing that its mitigation efforts could not reverse the
damage caused by its jetties. Banks II, 314 F.3d at 1310.
It is erroneous to hold Plaintiffs responsible for knowledge
that the Government itself had disclaimed prior to the
1997 Report. Cf. L.L.S. Leasing Corp. v. United States,
695 F.2d 1359, 1366 (Fed. Cir. 1982) (by taking upon itself
the obligation to report overtime usage, the Government
relieved the lessor of monitoring such use). The
Government itself explained in the 1958 Study that the
Corps believed that the erosion was not permanent and
could be mitigated and reversed. Banks III, 102 Fed. Cl.
at 133. Moreover, in 1973, the Government believed that
the jetty-induced erosion had not reached the majority of
Appellants’ properties. 12 The Government’s mitigation
efforts thus delayed when Appellants knew or should
have known they had a claim.
Without a basis for imputing knowledge of the effect
of the jetty-caused erosion on Appellants’ properties, it
was unreasonable to find that the Appellants were aware
of their claim regarding the permanency of the taking
before the 1990s Reports.
In light of the foregoing, and because “Dickinson
discouraged a strict application of accrual principles in
unique cases involving Fifth Amendment takings by
continuous physical processes,” Applegate, 25 F.3d at
12 The 1973 Report found that the “area of adverse
influence” of the jetties included properties less than
21,000 feet south of the harbor. J.A. 5776.
BANKS v. US 23
1582 (citing Dickinson, 331 U.S. at 749), the Court of
Federal Claims’ finding that Appellants knew or should
have known of the damage prior to 1952 is clearly
erroneous.
V. The Alternative Merits Discussion is Not a Final,
Appealable Decision
In Banks III, the Court of Federal Claims stated:
For purposes of judicial efficiency, if the reviewing
court in any appeal should disagree with the
court’s view of its jurisdiction, and to avoid the
possibility of a trial opinion being drafted months
or years after the trial, and the possibility of a
repetitive trial, the court also presents here its
findings from the trial. These findings are
presented in the alternative and, in the absence of
jurisdiction, do not entitle [P]laintiffs to just
compensation in the amounts determined by the
court.
102 Fed. Cl. at 120. In the absence of anything
appealable, this court lacks appellate jurisdiction. See 28
U.S.C. § 1295(a)(3). To be final and appealable, see Fed.
R. Civ. P. 54, a decision must end the litigation on the
merits, Catlin v. United States, 324 U.S. 229, 233 (1945),
and the judge must “clearly declare[] h[er] intention in
this respect,” United States v. F. & M. Schaefer Brewing
Co., 356 U.S. 227, 232 (1958). Here, contrarily, the Court
of Federal Claims reasoned that, “[b]ecause [the]
references [to when certain shore protection measures
were undertaken] are scattered across several thousand
pages of trial testimony and documentary evidence,” it
would not decide “which of [P]laintiffs’ shore protection
expenses were incurred between 1950 and 1970, the
period of time during which the government was
responsible for 30% of the erosion” “in the absence of
briefing or a stipulation by the parties.” Banks III, 102
Fed. Cl. at 212. It declined to “undertake to determine
BANKS v. US 24
which of [P]laintiffs’ expenses were incurred after 1970,
the period of time during which the [G]overnment has
completely mitigated the erosion caused by the jetties.”
Id. The Court of Federal Claims added that “[i]f the
reviewing court does not agree with the court’s
determination that it lacks jurisdiction to address
[P]laintiffs’ claims,” it would direct the parties to file
either a stipulation or briefing “to enable the court to
determine which of [P]laintiffs’ shore protection expenses
were incurred prior to 1970 and which were incurred
subsequent to 1970.” Id.
The Court of Federal Claims’ alternative merits
discussion is not a final and appealable decision over
which this court has jurisdiction. On remand, the Court
of Federal Claims may reconsider any merits rulings that
were rendered at a time it mistakenly believed it lacked
jurisdiction. In light of the Court of Federal Claims’
clearly erroneous fact finding on claim accrual, it is
appropriate that there be no law-of-the-case or
comparable obstacle preventing it from reconsidering its
earlier, related findings on the merits. This court’s prior
mandate—that the claims did not accrue until the 1999
Report—is still law-of-the-case, binding below.
CONCLUSION
The Court of Federal Claims’ dismissal for lack of
jurisdiction is reversed and the case is remanded to the
Court of Federal Claims for further proceedings.
REVERSED AND REMANDED