Vane Minerals (Us), LLC v. United States , 2014 U.S. Claims LEXIS 294 ( 2014 )

In the United States Court of Federal Claims
No. 13-413 L
Filed: April 29, 2014
TO BE PUBLISHED
************************************
* Administrative Procedure Act,
* 5 U.S.C. § 551 et seq.;
* Arizona Wilderness Act of 1984, Pub. L. 98-
* 406, 98 Stat. 1485 (as amended);
* Federal Land Policy and Management Act of
* 1976, 43 U.S.C. § 1701 et seq.;
* Mining Law of 1872, 30 U.S.C. §§ 22–47;
* National Environmental Policy Act of 1969,
* 42 U.S.C. § 4321 et seq.;
* Surface Mining Control and Reclamation
VANE MINERALS (US), LLC, * Act of 1977, 30 U.S.C. §§ 1201–1328
* (governing surface coal mining
Plaintiff, * operations);
* Ripeness;
v. * 36 C.F.R. § 228.4(c) (plan of operations for
* mining on Forest Service lands);
THE UNITED STATES, * 36 C.F.R. § 228.5(a)(1)–(5) (approving a
* plan of operations for mining on Forest
Defendant. * Service lands);
* 43 C.F.R. § 3809.100(a) (provisions
* applicable to segregated or withdrawn
* lands);
* 43 C.F.R. § 3809.401(b) (requirements for
* plan of operations on BLM lands);
* 43 C.F.R. § 3832.11(c)(1) (locating mining
* claims);
* RCFC 12(b)(1) (jurisdiction);
* RCFC 12(b)(6) (failure to state a claim).
************************************
John C. Lacy, DeConcini McDonald Yetwin & Lacy, P.C., Tucson, Arizona, Counsel for
Plaintiff.
Gregory Daniel Page, United States Department of Justice, Environment & Natural Resources
Division, Washington, D.C., Counsel for the Government.
MEMORANDUM OPINION AND FINAL ORDER
BRADEN, Judge.
I. FACTUAL BACKGROUND.1
VANE Minerals (US), LLC (“Plaintiff”), a Delaware limited liability company, has been
in the business of locating and exploring mineral properties in Northern Arizona since 1979.
Compl. ¶¶ 5, 10; 1/2/13 Hefton Decl. ¶ 2. Since October 2004, Plaintiff primarily has focused on
uranium exploration and mining, and has invested more than $8.5 million in uranium mining
exploration. Compl. ¶¶ 5, 8, 11; 1/2/13 Hefton Decl. ¶ 1.
As of June 21, 2013, Plaintiff held 678 unpatented lode mining claims on two areas of
federal land in Northern Arizona. Compl. ¶¶ 1, 7–10. The first area, known as the “Arizona
Strip,” includes 626,678 acres. 1/2/13 Hefton Decl. ¶ 10. The second area includes 355,874
acres in the Kaibab National Forest. 1/2/13 Hefton Decl. ¶ 10. Plaintiff asserted these claims,
pursuant to the Mining Law of 1872, 30 U.S.C. §§ 22–47, that “authorizes citizens to stake, or
‘locate,’ a valid mining claim upon ‘discovery’ of a valuable mineral deposit on public lands.”
Copar Pumice Co., Inc. v. United States, 112 Fed. Cl. 515, 520 (2013) (internal citations
omitted). The claims include “commercially viable concentrations of uranium [that] are located
within geological features known as breccia pipes,”2 and are “among the highest grade in the
world.” 1/2/13 Hefton Decl. ¶¶ 3–5. Mining uranium from breccia pipes occurs underground;
the ore is then transported for processing. 1/2/13 Hefton Decl. ¶ 6.
On July 21, 2009, the United States Department of the Interior (“Interior”), acting
through the Bureau of Land Management (“BLM”), published a Notice of Proposed Withdrawal
of “approximately 633,547 acres of public lands and 360,002 acres of National Forest System
lands for up to 20 years from location and entry under the Mining Law of 1872[.]” Notice of
Proposed Withdrawal and Opportunity for Public Meeting; Arizona, 74 FED. REG. 35,887-01
(July 21, 2009) (the “Withdrawal Notice”); see also 1/2/13 Hefton Decl. ¶ 10. The Withdrawal
Notice further segregated the aforementioned lands (“Withdrawal Area”) from location and entry
under the Mining Law of 1872 for a period of two years to “protect the Grand Canyon watershed
from adverse effects of locatable hardrock mineral exploration and mining,” and to allow
“studies and analyses, including appropriate National Environmental Policy Act analysis.”
Withdrawal Notice, 74 FED. REG. at 35,887. If approved by the Secretary of the Interior, Interior
1
The relevant facts cited herein were derived from: the June 21, 2013 Complaint
(“Compl.”); the August 5, 2013 Declaration of Rody Cox (“8/5/13 Cox Decl.”) and August 8,
2013 Declaration of Elizabeth Schuppert (“8/8/13 Schuppert Decl.”), including attached exhibits
(“Schuppert Decl. Exs. A–G”); the Government’s August 20, 2013 Motion To Dismiss; and the
January 2, 2013 Declaration of Kris Hefton (“1/2/13 Hefton Decl.”), attached as an exhibit to
Plaintiff’s September 20, 2013 Response to the Government’s August 20, 2013 Motion.
2
Breccia pipes are vertical columns of broken rock that have collapsed downward into
underground caverns, typically spanning 300 feet in diameter and extending vertically
underground for approximately 2,000 to 3,000 feet. 1/2/3 Hefton Decl. ¶ 3.
2
was authorized to withdraw the lands within the Withdrawal Area “subject to valid existing
rights.” Id. All of Plaintiff’s unpatented lode mining claims are located within the Withdrawal
Area. 1/2/13 Hefton Decl. ¶ 10.
On August 20, 2009, the United States Forest Service (“Forest Service”) met with all
interested uranium exploration and mining companies within the Withdrawal Area to discuss the
proposed mineral examination process that would be used to determine whether mining
claimants within the Withdrawal Area had valid existing rights that would be exempt from the
effects of the Withdrawal Notice. 8/8/13 Schuppert Decl. ¶¶ 5–9. At some unidentified time
thereafter, Plaintiff submitted a plan of operations to the Forest Service. 8/8/13 Schuppert
Decl. ¶ 9. On April 8, 2010, the Forest Service informed Plaintiff, in a letter addressed to Mr.
Hefton, of the steps necessary to obtain a valid existing rights determination and scheduled a
field examination for May 3, 2010. 8/8/13 Schuppert Decl. Ex. A. On May 7, 2010, Mr. Hefton
participated in a teleconference with various representatives from the Forest Service, during
which Mr. Hefton inquired about the consequences if Plaintiff withdrew its pending plan of
operations. 8/8/13 Schuppert Decl. Ex. C at 2. That same day, Mark Schwab, a Forest Service
Mineral Examiner, informed Mr. Hefton via email that if “the [p]lan of [o]perations is
withdrawn, there would be no need to conduct [a valid existing rights] determination of the
subject mining claims, and the [valid existing rights] examination would not occur.” 8/8/13
Schuppert Decl. Ex. C at 2. Later that day, Mr. Hefton withdrew Plaintiff’s proposed, submitted
plan of operations and all other plans of operation “on all of [Plaintiff’s] projects in the Kaibab
National Forest[.]” 8/8/13 Schuppert Decl. Ex. C at 1.
On June 21, 2011, close to the expiration of the two-year Withdrawal Notice, Interior
issued an “emergency six month withdrawal order of the subject Federal lands,” pursuant to the
Federal Land Policy and Management Act of 1976, 43 U.S.C. § 1701 et seq. (“FLPMA”).
Compl. ¶ 35.
On January 18, 2012, Interior “withdr[ew] approximately 1,006,545 acres of public and
National Forest System lands from location and entry under the Mining Law of
1872 . . . , subject to valid existing rights, for a period of 20 years in order to protect the Grand
Canyon Watershed from adverse effects of locatable mineral exploration and development.”
Public Land Order No. 7787; Withdrawal of Public and National Forest System Lands in the
Grand Canyon Watershed; Arizona, 77 FED. REG. 2,563-01 (Jan. 18, 2012) (the “Withdrawal
Order”)). The Withdrawal Order became effective on January 21, 2012. Id.II. PROCEDURAL HISTORY.
On September 27, 2012, Plaintiff filed a Complaint in the United States Court of Federal
Claims, alleging that the Withdrawal Order violated: the National Environmental Policy Act, 42
U.S.C. § 4321 et seq. (“NEPA”); FLPMA; the Arizona Wilderness Act of 1984, Pub. L. 98-406,
98 Stat. 1485 (“AWA”), and regulations adopted to implement each of these statutes.
Complaint, Vane Minerals v. United States, No. 12-cv-646 (Fed. Cl. Sept. 27, 2012), ECF No. 1.
The September 27, 2012 Complaint sought damages under two theories: inverse condemnation
and estoppel. Id.3
On November 26, 2012, the Government filed a Motion To Dismiss, pursuant to RCFC
12(b)(1), arguing that the court did not have jurisdiction to adjudicate the claims alleged in the
September 27, 2012 Complaint, because Plaintiff previously filed Complaints-In-Intervention on
June 4, 2012 and June 27, 2012 in the United States District Court for the District of Arizona in
cases that arose from the same set of operative facts as the suit in the United States Court of
Federal Claims.
On December 26, 2012, Plaintiff filed a Notice in the United States District Court for the
District of Arizona requesting that the June 4, 2012 and June 27, 2012 Complaints-In-
Intervention be dismissed, without prejudice. See Yount v. Salazar, No. 3:11-cv-8171 (D. Ariz.
Dec. 26, 2012), ECF No. 86. On January 8, 2013, the United States District Court for the
District of Arizona dismissed Plaintiff’s Complaints, without prejudice. See Yount v. Salazar,
No. 3:11-cv-8171 (D. Ariz. Jan. 8, 2013), ECF No. 87.
On January 2, 2013, Plaintiff filed a Response to the Government’s November 26, 2012
Motion To Dismiss. On January 22, 2013, the Government filed a Reply.
On May 29, 2013, the United States Court of Federal Claims issued a Memorandum
Opinion And Final Order, determining “that 28 U.S.C. § 1500 divests the court of
jurisdiction . . . , because at the time of the filing of the September 27, 2012 Complaint in the
United States Court of Federal Claims, Plaintiff was a party to two prior related cases in the
United States District Court for the District of Arizona, arising from the same set of operative
facts.” See Vane Minerals (US), LLC v. United States, 111 Fed. Cl. 253, 255–56 (2013) (“Vane
I”).
On June 21, 2013, Plaintiff filed a second Complaint in the United States Court of
Federal Claims that is almost identical to that dismissed on May 29, 2013 in Vane I.
The Complaint alleges that, within the Withdrawal Area, 3,350 mining claims are
located, including 678 of Plaintiff’s unpatented lode mining claims constituting 20.2% of that
total and an “estimated undiscovered uranium endowment of 12,250 tons of uranium oxide.”
Compl. ¶ 57(a)–(c). Approximately 1,837 tons of uranium oxide underlying Plaintiff’s claims is
commercially feasible to mine, representing a projected net value to Plaintiff (after deducting
projected development expenses) of “between $68,550,000 and $123,615,000.” Compl. ¶¶
57(d)–58. To date, the BLM and Forest Service have refused to allow Plaintiff to explore its
mining claims or locate additional claims. Compl. ¶ 60. In particular, the Complaint alleges that
the Withdrawal Notice effectively prevented Plaintiff from engaging in mining operations until
the BLM prepared a mineral examination report, confirming that Plaintiff had made a “mineral
discovery.” 1/2/13 Hefton Decl. ¶ 11 (citing 43 C.F.R. § 3809.1003); see also Pl. Resp. 6 (“Had
3
This regulation, first promulgated as a Final Rule on November 21, 2000, provides, in
relevant part, that:
After the date on which the lands are withdrawn from appropriation under the
mining laws, BLM will not approve a plan of operations or allow notice-level
operations to proceed until BLM has prepared a mineral examination report to
determine whether the mining claim was valid before the withdrawal, and whether
4
the [Withdrawal Notice], and later the [W]ithdrawal [Order], not been in effect, the Forest
Service would not have required mineral examinations or demonstrations of mineral discoveries
as a condition of approving [Plaintiff’s] plan of operations.”).
The June 21, 2013 Complaint alleges two causes of action: “Inverse Condemnation”
(Count I) and “Estoppel” (Count II). Insofar as Count I is concerned, the June 21, 2013
Complaint alleges that, as a result of the Withdrawal Order, Plaintiff has been “deprived all
economic and other benefits of its property interests in the 678 lode mining claims located within
[the Withdrawal Area].” Compl. ¶ 62. Count II is referred to, in the alternative, as a claim for
“estoppel” (Compl. 18), “promissory estoppel” (Compl. ¶ 3), and/or “equitabl[e] estoppe[l].”
Compl. ¶ 69. In particular, Count II alleges that Plaintiff: (1) “suffered as a result of [Plaintiff’s]
reliance upon longstanding congressional and administrative representations that the
[Withdrawal Area] would remain open for mining” (Compl. 19); (2) is entitled to “exploration
costs under the concept of promissory estoppel” (Compl. ¶ 3); and/or (3) is entitled to damages,
because the Government is “equitably estopped from enforcing the [Withdrawal Order] such
that, if the [Withdrawal Order] is not reversed, [Plaintiff] is entitled to damages equal to the
amounts it spent on its mineral exploration program” (Compl. ¶ 70).
The June 21, 2013 Complaint seeks $68,550,000 in compensation for the Government’s
“taking” of Plaintiff’s 678 unpatented lode mining claims, and $8,500,000 to reimburse Plaintiff
for expenditures made in reliance on the uranium exploration program. Compl. 19.
On August 20, 2013, the Government filed a Motion To Dismiss (“Gov’t Mot.”),
pursuant to RCFC 12(b)(1) and 12(b)(6), together with: (1) the 8/5/13 Declaration of Rody Cox,
a geologist in the BLM Arizona Strip Field Office; and (2) the 8/8/13 Declaration of Elizabeth
Schuppert, a Forest Service Forester, employed in the Kaibab National Forest.
On September 20, 2013, Plaintiff filed a Response (“Pl. Resp.”), together with: (1) the
1/2/13 Declaration of Kris Hefton, Plaintiff’s Chief Operating Officer; (2) a copy of a United
States District Court for the District of Arizona’s Opinion And Order denying in part, and
granting in part, the Government’s Motion To Dismiss in Yount v. Salazar (Yount v. Salazar, No.
3:11-cv-8171 (D. Ariz. Jan. 8, 2013), ECF No. 87); and (3) an excerpt of the Northern Arizona
Proposed Withdrawal Final Environmental Impact Statement.
On November 8, 2013, the Government filed a Reply (“Gov’t Reply”).
it remains valid. BLM may require preparation of a mineral examination report
before approving a plan of operations or allowing notice-level operations to
proceed on segregated lands. If the report concludes that the mining claim is
invalid, BLM will not approve operations or allow notice-level operations on the
mining claim. BLM will also promptly initiate contest proceedings.
43 C.F.R. § 3809.100(a); see also Mining Claims Under the General Mining Laws; Surface
Management, 65 FED. REG. 69,998-01, 70,025 (Nov. 21, 2000) (promulgating Final Rule).
5
III. DISCUSSION.
A. Jurisdiction.
The United States Court of Federal Claims has jurisdiction under the Tucker Act, 28
U.S.C. § 1491, “to render judgment upon any claim against the United States founded either
upon the Constitution, or any Act of Congress or any regulation of an executive department, or
upon any express or implied contract with the United States, or for liquidated or unliquidated
damages in cases not sounding in tort.” 28 U.S.C. § 1491(a)(1). The Tucker Act, however, is “a
jurisdictional statute; it does not create any substantive right enforceable against the United
States for money damages . . . . [T]he Act merely confers jurisdiction upon [the United States
Court of Federal Claims] whenever the substantive right exists.” United States v. Testan, 424
U.S. 392, 398 (1976).
Therefore, to pursue a substantive right under the Tucker Act, a plaintiff must identify
and plead an independent contractual relationship, Constitutional provision, federal statute,
and/or executive agency regulation that provides a substantive right to money damages. See
Todd v. United States, 386 F.3d 1091, 1094 (Fed. Cir. 2004) (“[J]urisdiction under the Tucker
Act requires the litigant to identify a substantive right for money damages against the United
States separate from the Tucker Act itself.”); see also Fisher v. United States, 402 F.3d 1167,
1172 (Fed. Cir. 2005) (en banc) (“The Tucker Act . . . does not create a substantive cause of
action; . . . a plaintiff must identify a separate source of substantive law that creates the right to
money damages . . . . [T]hat source must be ‘money-mandating.’”). Specifically, a plaintiff must
demonstrate that the source of substantive law upon which he relies “can fairly be interpreted as
mandating compensation by the Federal Government.” United States v. Mitchell, 463 U.S. 206,
216 (1983) (quoting Testan, 424 U.S. at 400). And, the plaintiff bears the burden of establishing
jurisdiction by a preponderance of the evidence. See Reynolds v. Army & Air Force Exch. Serv.,
846 F.2d 746, 748 (Fed. Cir. 1988) (“[O]nce the [trial] court’s subject matter jurisdiction [is] put
in question . . . . [the plaintiff] bears the burden of establishing subject matter jurisdiction by a
preponderance of the evidence.”).
B. Standard Of Review For A Motion To Dismiss Pursuant To RCFC 12(b)(1).
A challenge to the United States Court of Federal Claims’ “general power to adjudicate in
specific areas of substantive law . . . is properly raised by a [Rule] 12(b)(1) motion[.]”
Palmer v. United States, 168 F.3d 1310, 1313 (Fed. Cir. 1999); see also RCFC 12(b) (“Every
defense to a claim for relief in any pleading must be asserted in the responsive pleading if one is
required. But a party may assert the following defenses by motion: (1) lack of subject-matter
jurisdiction[.]”). When considering whether to dismiss an action for lack of subject matter
jurisdiction, the court generally is “obligated to assume all factual allegations of the complaint to
be true and to draw all reasonable inferences in plaintiff’s favor.” Henke v. United States, 60
F.3d 795, 797 (Fed. Cir. 1995).
C. Standard Of Review For A Motion To Dismiss Pursuant To RCFC 12(b)(6).
A challenge to the United States Court of Federal Claims’ “[ability] to exercise its
general power with regard to the facts peculiar to the specific claim . . . is raised by a [Rule]
6
12(b)(6) motion[.]” Palmer, 168 F.3d at 1313; see also RCFC 12(b)(6) (“Every defense to a
claim for relief in any pleading must be asserted in the responsive pleading . . . . [b]ut a party
may assert the following defenses by motion: . . . (6) failure to state a claim upon which relief
can be granted[.]”).
When considering whether to dismiss an action for failure to state a claim, the court
“must assess whether the complaint adequately states a claim and whether plaintiffs can allege
facts plausibly suggesting (not merely consistent with) a showing of entitlement to relief.”
Hutchens v. United States, 89 Fed. Cl. 553, 562 (2009) (internal citations omitted). A claim has
facial plausibility when “the plaintiff pleads factual content that allows the court to draw the
reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal,
556 U.S. 662, 678 (2009). The plaintiff’s factual allegations must be substantial enough to raise
the right to relief “above the speculative level,” accepting all factual allegations in the complaint
as true and “indulg[ing] all reasonable inferences in favor of the non-movant.” Hutchens, 89
Fed. Cl. at 562 (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)).
D. Applicable Statutory And Regulatory Framework.
Plaintiff’s 678 unpatented mining claims, located on Forest Service and BLM lands, are
governed by the Mining Law of 1872 that “encourages citizens to locate valuable mineral
deposits on public land owned by the federal [G]overnment,” Grover v. United States, 73 Fed.
App’x 401, 402 (Fed. Cir. 2003), and authorizes American citizens to “locate” valid mining
claims after “discovery” of valuable mineral deposits and compliance with applicable legal
requirements. Chrisman v. Miller, 197 U.S. 313, 322–23 (1905); see also United
States v. Coleman, 390 U.S. 599, 602 (1968) (recognizing that Congress enacted the Mining Law
of 1872 so that the certain public lands would be “available to people for the purpose of mining
valuable mineral deposits”). The discovery of a valid mining claim occurs when the claimant
demonstrates that a reasonably prudent person would be justified in expending effort to further
develop the claim. See Best v. Humboldt Placer Min. Co., 371 U.S. 334, 335–36 (1963) (“[The]
discovery must be of such a character that ‘a person of ordinary prudence would be justified in
the further expenditure of his labor and means, with a reasonable prospect of success, in
developing a valuable mine.’” (quoting Castle v. Womble, 19 Pub. Lands Dec. 455, 457
(1894)4)); see also ROCKY MTN. MIN. L. FOUND, 2 AMERICAN LAW OF MINING, § 30.5, 30-15
(2013) (“Discovery of a valuable mineral deposit is the sine qua non of a valid mining claim.”).
4
The Mining Law of 1872 requires a claimant to make a “discovery of the vein or lode
within the limits of the claim located,” but “discovery” is not statutorily defined. 30 U.S.C. § 23.
In Castle v. Womble, Interior promulgated a rule for the first time, in a Reporter entitled
Decisions Relating To The Public Lands (“Pub. Lands Dec.”), that a “discovery” occurred within
the meaning of the Mining Law of 1872 when “mineral is found, and the evidence shows that a
person of ordinary prudence would be justified in the further expenditure of his labor and means,
with a reasonable prospect of success, in developing a valuable mine.” Castle, 19 Pub. Lands
Dec. at 457. The United States Supreme Court “has approved the prudent-man formulation and
interpretation on numerous occasions,” interpreting the term “discovery” in the same manner that
“the Secretary [of the Interior] has been using to interpret the mining laws since 1894.”
Coleman, 390 U.S. at 602.
7
A mining claimant also must establish that “the mineral can be extracted, removed, and marketed
at a profit.” Coleman, 390 U.S. at 600 (internal citations and quotations omitted).
Congress, however, subsequently enacted Section 204(c) of FLPMA, that authorizes the
Secretary of the Interior to withdraw lands of five thousand acres or more from location and
entry under the Mining Law, “for a period of not more than twenty years.” 43
U.S.C. § 1714(c)(1). That authority includes lands managed by the BLM as well as the Forest
Service. See 43 U.S.C. 1702(j) (providing that a “withdrawal” applies to “federal Land”); see
also id. § 1714(i) (authorizing the Secretary of the Interior to withdraw lands under the
administration of another department or agency “with the consent of the head of the department
or agency concerned”).
The Mining Law of 1872 recognizes two types of property rights in mining claims:
unpatented and patented. See Best, 371 U.S. at 335–36 (describing the difference between
unpatented and patented mining claims). An unpatented mining claim vests in a claimant upon
the discovery of a valuable mineral deposit and compliance with applicable regulations. Id. at
336. A claimant with an unpatented mining claim “enjoys an exclusive possessory right in the
surface land and the underlying mineral deposits, [but] the United States retains fee title in the
land.” Grover, 73 Fed. App’x at 402 (internal quotations omitted); see also Best, 371 U.S. at335–36 (describing unpatented mining claims as “a possessory interest in land that is ‘mineral in
character’ . . . . [but where] the title to the lands in controversy still [belongs to] the United
States”). Provided a recognized discovery is made, unpatented mining claims also are “fully
recognized possessory interests.” United States v. Locke, 471 U.S. 84, 104 (1985) (holding that
unpatented mining claims are protected property rights, but that the Government, “as owner of
the underlying fee title to the public domain, maintains broad powers over the terms and
conditions upon which the public lands can be used, leased, and acquired”).
The Mining Law of 1872 also authorizes a claimant with unpatented mining claims to
apply for a mineral patent and thereby obtain title to the land in fee simple from the
Government.5 See 30 U.S.C. § 29 (describing the procedure for obtaining a “patent for any land
claimed and located for valuable deposits”); see also ROCKY MTN. MIN. L. FOUND, 2 AMERICAN
LAW OF MINING, § 30.06, 30-21 (2013) (“There is no requirement to apply for [a] patent, and a
locator may mine and extract all mineral from his claim without ever making payment to the
United States. Nevertheless, the possessory rights of a locator are not fully secure until he
obtains full legal title by patent.”). To obtain a patent, a mining claimant must submit an
application to the BLM, which will then survey the claims and adjudicate the application to
verify that a discovery of a valuable mineral has been made. See ROCKY MTN. MIN. L. FOUND, 2
AMERICAN LAW OF MINING, § 30.06, 30-21 (2013).
5
But, since October 1, 1994, Congress annually has renewed a moratorium on BLM’s
acceptance of new mineral patent applications. See BLM, Mining Claims and Sites on Federal
Lands, http://www.blm.gov/pgdata/etc/medialib/blm/wo/MINERALS__REALTY__AND_
RESOURCE_PROTECTION_/energy.Par.28664.File.dat/MiningClaims.pdf (last visited Apr.
14, 2014).
8
For claims located after October 21, 1976, however, a claimant is required to file with the
BLM “the official record of the notice of location or certificate of location,” within ninety days
of the initial location of a mining claim, but a claimant is not required to demonstrate that a
“discovery” has been made at that point. See 43 U.S.C. § 1744(b). The issue of whether a
discovery has been made arises in “controversies between rival claimants, each of whom claim
the same ground by virtue of a mining location,” and in disputes “between a mining claimant and
the United States.” ROCKY MTN. MIN. L. FOUND, 2 AMERICAN LAW OF MINING, §§ 35.10, 35-
31–35-32 (2013). When such disputes arise between private parties, the court must decide
whether a discovery has occurred. Id. at 35-32. In controversies between a claimant and the
Government, however, Congress has authorized Interior to determine whether a claimant made a
discovery of a valuable mineral deposit. Id. Judicial review of a Final Interior decision is
authorized only by a United States District Court. See Patterson v. United States, 115 Ct. Cl.
348, 354–55 (1950) (holding that United States District Courts, not the Court of Claims, had
jurisdiction under the Administrative Procedure Act to review Interior’s determination that
plaintiffs had not made a valid discovery of a mineral deposit). Interior’s decision “on the
question of discovery will be upheld on appeal unless it is arbitrary or capricious, or induced by
fraud or imposition, or not supported by substantial evidence.” ROCKY MTN. MIN. L. FOUND, 2
AMERICAN LAW OF MINING, § 35.10, 35-32 (2013); see also Converse v. Udall, 399 F.2d 616,
618 (9th Cir. 1968) (holding that a United States District Court has jurisdiction to review
Interior’s determinations under the Administrative Procedure Act).
When a mining claim is located on land withdrawn from mineral entry under Section
204(c) of FLPMA, to continue to mine notwithstanding the withdrawal, the claimant must prove
discovery of a valuable mineral deposit, as of the time of withdrawal. See Skaw v. United States,
13 Cl. Ct. 7, 28 (1987) (“When land is closed to location under the mining laws subsequent to
the location of a mining claim, the validity of the claim cannot be recognized unless the claim
was supported by a valid discovery at the time of the withdrawal.”), aff’d 847 F.2d 842 (Fed. Cir.
1988); see also 43 C.F.R. § 3809.100(a) (“After the date on which the lands are withdrawn from
appropriation under the mining laws, BLM will not approve a plan of operations . . . until BLM
has prepared a mineral examination report to determine whether the mining claim was valid
before the withdrawal, and whether it remains valid.”).
In this instance, the January 18, 2012 Withdrawal Order, issued pursuant to the Secretary
of the Interior’s authority under Section 204(c) of FLPMA, withdraws lands from the ambit of
the Mining Law of 1872, but does not prohibit claimants from mining with “valid existing
rights.” See Withdrawal Order, 77 FED. REG. at 2,563 (“[T]his order withdraws approximately
1,006,545 acres of public and National Forest System lands from location and entry under the
Mining Law of 1872, . . . subject to valid existing rights[.]” (emphasis added)); see also Skaw, 13
Cl. Ct. at 28 (holding that a claimant has valid existing rights when it made a discovery of a
valuable mineral deposit, as of the time of the relevant withdrawal).
The BLM and Forest Service must conduct a valid existing rights determination (“VER
determination”) to ascertain whether a claimant has made a discovery of a valuable mineral
deposit, thus endowing them with “valid existing rights” and excepting those claims from the
moratorium imposed by the Withdrawal Order. See Skaw, 13 Cl. Ct. at 29 (explaining that if a
9
mining “claim is not valid at the time of withdrawal it is not excepted from the effect of the
withdrawal”).6
To obtain a VER determination under BLM regulations, a mining claimant must first
submit a “plan of operations” for the proposed mining operation. See 43 C.F.R. § 3809.100(a).
BLM will not approve a plan of operations on withdrawn lands until BLM prepares a “mineral
examination report” that determines “the mining claim was valid before the withdrawal . . . [and]
remains valid.” Id. And, as explained above, a valid mining claim requires a claimant to show it
made a “discovery” of a valuable mineral deposit within the boundaries of the claim. See
Hafen v. United States, 30 Fed. Cl. 470, 473 (1994) (describing a mining claim on public lands
as a “unique form of property . . . . [requiring a] discovery ‘within the limits of the claim’”
(quoting Cameron v. United States, 252 U.S. 450, 456 (1920))). If the BLM determines that a
mining claim is valid, the BLM will process the claimant’s plan of mining operations to ensure it
is consistent with the requirements of 43 C.F.R. § 3809.401.7 Thereafter, the BLM may require a
claimant to provide “[o]perational and baseline environmental information for BLM to analyze
potential environmental impacts as required by the National Environmental Policy Act[.]”
Id. § 3809.401(c).
To obtain a VER determination under Forest Service regulations, a mining claimant must
first submit a plan of operations for proposed mining operations, that includes: information about
the mining operator; detailed maps showing the location of and access to the proposed mine; and
“[i]nformation sufficient to describe or identify the type of operations proposed and how they
will be conducted[.]” 36 C.F.R. § 228.4(c). The Forest Service will not approve a plan of
operations until it undertakes a VER “determination necessary to determine if [a mining
claimant] had discovered a valuable mineral deposit[.]” 8/8/13 Schuppert Decl. ¶ 9; see also 36
C.F.R. § 228.41 (prohibiting the removal of mineral materials “from segregated or withdrawn
lands,” but noting that this provision does not “prohibit the exercise of valid existing rights”).
6
The relevant BLM internal policy document explains:
Holders of mining claims and sites located within lands later withdrawn from
mineral entry must prove their right to continue to occupy and use the land for
mining purposes. The owner must demonstrate they contain a discovery of a
valuable mineral deposit and/or are used and occupied properly under the General
Mining Law, as of the date of withdrawal and as of the date of the mineral
examination. Mining claims or sites whose discovery or use or occupation cannot
be demonstrated on the date of withdrawal or the date of mineral examination
have no valid existing rights and will be contested by the Department.
BLM, Mining Law Administration, “Valid and Existing Rights Determinations.” See
http://www.blm.gov/wo/st/en/info/regulations/mining_claims.html (last visited Apr. 14, 2014).
7
This regulation requires a plan of operations that includes: detailed operator
information; a description of operations; maps showing drill sites and mining activities; water
management plans; a reclamation plan; a monitoring plan; and an interim management plan. See
43 C.F.R. § 3809.401(b) (listing the information a “plan of operations must contain”).
10
Unless the Forest Service has made a VER determination, it will not approve, modify, or deny a
plan of operations. See 36 C.F.R 228.5(a)(1)–(5) (listing the actions the Forest Service must take
after receiving a proposed plan of operations).
E. Issues Raised By The Government’s August 20, 2013 Motion To Dismiss.
1. Whether Plaintiff’s Takings Claims Are Ripe For Adjudication.
a. The Government’s Argument.
First, the Government argues that Plaintiff’s inverse condemnation claims are not ripe for
adjudication, because Plaintiff failed to follow the administrative procedures required by the
BLM and Forest Service. Gov’t Mot. 13. In particular, Plaintiff neither submitted a plan of
operations nor obtained a BLM mineral examination report. 8/5/13 Cox Decl. ¶ 4–8. Nor has
Plaintiff submitted a plan of operations to the Forest Service and consequently has not received a
VER determination. 8/8/13 Schuppert Decl. ¶ 5. In fact, on May 7, 2010, Plaintiff specifically
withdrew a previously proposed plan of operations submitted to the Forest Service, even though
the Forest Service had scheduled a field visit to begin the VER determination process. 8/8/13
Schuppert Decl. ¶ 9. Since Plaintiff has complied with neither the BLM nor Forest Service
procedures, neither agency has “made a preliminary or final decision that would bar [P]laintiff
from using or that would take [P]laintiff’s unpatented mining claims[.]” 8/8/13 Schuppert Decl.
¶ 5; see also 8/5/13 Cox. Decl. ¶ 4 (same).
Therefore, Plaintiff’s failure to comply with the mandated procedures of both the BLM
and Forest Service prevents the court from “determining if the [W]ithdrawal [O]rder has taken or
will ever take [P]laintiff’s unpatented mining claims.” Gov’t Mot. 13 (“The [W]ithdrawal
[O]rder cannot take or prohibit [P]laintiff from using its unpatented mining claims unless BLM
determines first that [P]laintiff does not have valid existing rights.” (internal citation omitted)).
In other words, because the plain language of the Withdrawal Order evidences that it does not
prohibit mining on claims with valid existing rights, the court cannot determine what impact, if
any, the Withdrawal Order has on Plaintiff’s mining claims, unless and until Plaintiff receives a
VER determination. Gov’t Reply 1; see also id. (“If the [Government] decides that some or all
of [Plaintiff’s] claims are valid existing rights . . . , then the [W]ithdrawal [O]rder would not
prohibit [Plaintiff] from mining[.]”).
Moreover, because Plaintiff’s takings claims must be analyzed under the three factors
articulated by Penn Central Transportation Company v. City of New York, 438 U.S. 104, 124
(1978), Plaintiff’s decision to avoid the required administrative procedures deprives the court of
the “concrete facts” necessary to adjudicate Plaintiff’s takings claims. Gov’t Mot. 13 (citing
Palazzolo v. Rhode Island, 533 U.S. 606, 618–19 (2001) (explaining that a federal trial court
may not adjudicate an unripe takings claim under Penn Central, as that analysis “cannot be
resolved in definitive terms until a court knows ‘the extent of permitted development’ on the
land in question”) (quoting MacDonald, Sommer & Frates v. Yolo County, 477 U.S. 340, 351
(1986))); see also id. 15 (citing Stearns Co. v. United States, 396 F.3d 1354, 1357–58 (Fed. Cir.
2005) (dismissing a takings claim of plaintiff’s mining rights as unripe, where the agency
retained authority under the Surface Mining Control and Reclamation Act of 1977, 30
11
U.S.C. §§ 1201–1328, to afford relief that was equivalent to “VER status”); see also Williamson
Cnty. Reg’l Planning Comm’n v. Hamilton Bank of Johnson City, 473 U.S. 172, 191 (1985) (A
takings claim “simply cannot be evaluated until the administrative agency has arrived at a final,
definitive position regarding how it will apply the regulations at issue to the particular land in
question.”)). In short, it is impossible for the court to determine whether the Government
“actually took” a property interest, unless and until Plaintiff avails itself of the administrative
procedures at the BLM and Forest Service that Congress provided. Gov’t Mot. 9 (citing Air
Pegasus of D.C., Inc. v. United States, 424 F.3d 1206, 1212–13 (Fed. Cir. 2005) (explaining that,
even where a property owner has a “valid property interest, the court [nevertheless also] must
determine whether the governmental action at issue amounted to a compensable taking of that
property interest”) (quoting Am. Pelagic Fishing Co., L.P. v. United States, 379 F.3d 1363, 1372
(Fed. Cir. 2004))).
Second, the Government argues that Plaintiff cannot establish that the 678 unpatented
mining claims at issue are protected property rights, since “[P]laintiff lacks the [VER]
determinations under the Mining Law [of 1872] that would be necessary to establish that these
claims are compensable property interests.” Gov’t Mot. 15 (citing Best, 371 U.S. at 336–37
(holding that unpatented mining claims are only “valid against the United States if there has been
a discovery of mineral within the limits of the claim”)); see also id. 17 (citing Hall v. United
States, 84 Fed. Cl. 463, 470–71 (2008) (explaining that a compensable property interest in
unpatented mining claims requires a determination as to the validity of those claims) (internal
citations and quotations omitted)). To obtain a VER determination, the BLM and Forest Service
“must conduct . . . mining claim validity examinations to determine if [P]laintiff
has . . . discover[ed] ‘valuable mineral deposits.’” Gov’t Reply 2 (quoting 30 U.S.C. § 22(“[A]ll valuable mineral deposits in lands belonging to the United States . . . shall be free and
open to exploration and purchase[.]” (emphasis added))).
Third, the Government argues that the United States District Court for the District of
Arizona’s decision in Yount v. Salazar, No. 3:11-cv-8171, 2013 WL 93372 (D. Ariz. Jan. 8,
2013), holding that challenges to the Withdrawal Order on various statutory and regulatory
grounds are ripe for adjudication, does not have preclusive effect in this litigation. Gov’t Reply
4 (citing Laguna Hermosa Corp. v. United States, 671 F.3d 1284, 1288 (Fed. Cir. 2012) (holding
that collateral estoppel did not apply where an issue decided in an earlier case was not identical
to the issue in the pending case)).
b. Plaintiff’s Response.
Plaintiff responds to the Government’s ripeness argument in four ways. First, Plaintiff
does not dispute that it has not received a VER determination from the Forest Service or BLM.
Instead, Plaintiff responds that obtaining a VER determination is “unnecessary,” since the
Government “already acknowledged the existence of valuable mineral deposits under
[Plaintiff’s] claims.” Pl. Resp. 10. On October 27, 2011, the BLM, in contemplation of the
Withdrawal Order, issued a Final Environmental Impact Statement (“FEIS”), pursuant to NEPA,
concluding that 60,638 tons of uranium oxide lies underneath the 3,350 mining claims located
within the Withdrawal Area. Pl. Resp. 10 (citing FEIS, B-26). The methodology employed by
the BLM in the FEIS demonstrates that 12,250 tons of uranium oxide lies under Plaintiff’s
12
unpatented mining claims, and as such, the Government has “already made administrative
findings that support the existence of valuable minerals and valid existing rights by [Plaintiff].”
Pl. Resp. 11.8
Second, Plaintiff argues that this dispute is ripe for adjudication, because “an
administrative decision has been formalized and its effects are felt [by Plaintiff] in a concrete
way[.]” Pl. Resp. 7 (citing Abbott Labs. v. Gardner, 387 U.S. 136, 148–49 (1967) (holding that
to determine whether an action is ripe for adjudication the court must “evaluate both the fitness
of the issues for judicial decision and the hardship to the parties of withholding court
consideration”)). According to Plaintiff, the Withdrawal Order is a “final decision” that
precludes Plaintiff from conducting exploratory drilling and from “demonstrating the existence
of valuable minerals . . . [and] from developing and profiting from its claims.” Pl. Resp. 8; see
also id. (“[T]he [Government] has taken [Plaintiff’s] mining claims specifically because it has
taken [Plaintiff’s] ability to explore those claims.”).9
Third, Plaintiff asserts that the Government’s ripeness argument has been rejected by the
United States District Court for the District of Arizona in Yount, 2013 WL 93372, at *14, an
action “based on the same facts as the present case” that challenges the Withdrawal Order under
the Administrative Procedure Act, 5 U.S.C. § 551 et seq. Pl. Resp. 9. In addition, the June 21,
2013 Complaint properly pleads the elements of a per se taking claim. As such, the court must
accept, as true, Plaintiff’s assertion that “it owns 678 valid mining claims” at this stage of the
litigation, recognizing that additional proof will be necessary at trial; and that the validity of
Plaintiff’s claims is an element of this cause of action. Pl. Resp. 11–14 (citing Lucas v. South
Carolina Coastal Council, 505 U.S. 1003, 1019 (1992) (holding that when a regulation forces
the owner of real property to sacrifice all economically beneficial uses their property, they
“ha[ve] suffered a taking”)); see also id. 12 (construing the Government’s ripeness arguments as
an “improper[] demand[] that [Plaintiff] prove elements of its case as a prerequisite to bring[ing]
this action”).
Fourth, Plaintiff argues that there are two distinct standards used to evaluate mining
claims. “The first, and more lenient standard, applies to the initial location, or ‘staking,’ of
mining claims.” Pl. Resp. 13. The prerequisite for the initial location of a mining is a
“discovery . . . of such a character that a person of ordinary prudence would be justified in the
further expenditure of his labor and means, with a reasonable prospect of success, in developing
a valuable mine.” Pl. Resp. 13 (quoting Best, 371 U.S. at 335–36 (quoting Castle, 19 Pub. Lands
Dec. at 457)). A claimant that made this initial “discovery” is entitled to stake the mining claim,
and then explore and develop that claim. Pl. Resp. 13. The second and stricter standard,
however, is necessary to obtain a “patent (or title)” to the land encompassed by the mining claim,
8
Plaintiff further observes that a mineral examination of its 678 claims “will never
happen.” Pl. Resp. 11.
9
In addition, undergoing a VER determination is “meaningless because it generally is not
possible to demonstrate mineral discovery as mandated by the [Government] without exploratory
drilling, and under the [W]ithdrawal [Order], the exploratory drilling is prohibited without a
demonstrated mineral discovery.” Pl. Resp. 8.
13
which requires a mining claimant to demonstrate that the claim is “valuable for minerals . . . or
that there is a showing of sufficient valuable minerals to economically justify establishing a
working mine.” Pl. Resp. 13 (quoting Best, 371 U.S. at 336). Because Plaintiff’s unpatented
mining claims are centered on brecchia pipes, they are “likely to contain mineralization.” Pl.
Resp. 13–14. As such, Plaintiff does not need to comply with the BLM and Forest Service’s
regulatory scheme because the “the nature of such geologic formations is such that a prudent
person would invest further labor and means to explore and confirm mineralization, thus
satisfying the first standard[.]” Pl. Resp. 13. The Withdrawal Order, by contrast, impermissibly
requires Plaintiff to satisfy the second, more stringent standard, amounting to a “regulatory
change . . . [that] is an inappropriate standard to [gauge] the validity of a mining claim for the
purposes of permitting mineral exploration.” Pl. Resp. 14–15; see also id. 12 (explaining that the
Withdrawal Order “creates a regulatory scheme for mining claims that previously did not exist,
and which effectively destroys [Plaintiff’s] ability to explore, develop and economically benefit
from its mining claims”).
c. The Court’s Resolution.
Foundational principles of ripeness and takings jurisprudence govern resolution of
Plaintiff’s takings claims. A “takings claim calls for a two-step analysis.” Karuk Tribe of
Cal. v. Ammon, 209 F.3d 1366, 1374 (Fed. Cir. 2000). First, the court must determine whether
the claimant has established a compensable property interest. See Hall, 84 Fed. Cl. at 470; see
also Am. Pelagic Fishing Co., 379 F.3d at 1372. If, however, “the claimant fails to demonstrate
the existence of a legally cognizable property interest, the [court’s] task is at an end.” Am.
Pelagic Fishing Co., 379 F.3d at 1372. Second, the court must determine “whether the character
of the governmental action affected the claimant’s ‘bundle of property rights.’” Hall, 84 Fed. Cl.
at 470 (quoting Karuk Tribe, 209 F.3d at 1374); see also Chancellor Manor v. United States, 331
F.3d 891, 902 (Fed. Cir. 2003) (same re: whether governmental action constitutes a compensable
taking “for a public purpose”). The Fifth Amendment, however, does not create the property
interests it protects. See Phillips v. Wash. Legal Found., 524 U.S. 156, 164 (1998) (“Because the
Constitution protects rather than creates property interests, the existence of a property interest is
determined by reference to ‘existing rules or understandings that stem from an independent
source such as state law.’” (quoting Board of Regents of State Colleges v. Roth, 408 U.S. 564,
577 (1972))).
To determine Plaintiff’s property interest, the court is cognizant that unpatented mining
claims are a unique form of property constituting a “possessory interest in land,” where “the title
to the land in controversy still belongs to the United States.” Hafen, 30 Fed. Cl. at 473; see also
Best, 371 U.S. at 336 (“Respondents’ mining claims are unpatented, the title to the lands in
controversy still being in the United States.”). Nevertheless, unpatented mining claims are a
protected property interest, “if there has been a discovery of mineral within the limits of the
claim.” Best, 371 at 336 (emphasis added); see also Holden v. United States, 38 Fed. Cl. 732,
735 (1997) (“To have a compensable interest in unpatented mining claims sufficient to bring a
taking action in [the United States Court of Federal Claims], there must have been a
determination as to the validity of those mining claims.”); Payne v. United States, 31 Fed. Cl.
709, 711 (1994) (“[A] finding that an unpatented claim is valid against the United States . . . can
only be made if there has been a discovery of [a] mineral within the limits of the claim.” (internal
quotations and citations omitted)); Hafen, 30 Fed. Cl. at 473 (same). No rights, however, attach
14
to an invalid claim. See Best, 371 U.S. at 337 (“[N]o right arises from an invalid claim of any
kind.”). Congress has authorized the Department of Interior to determine the validity of mining
claims on the public lands. See Cameron, 252 U.S. at 460 (“[T]he Secretary of the Interior . . . is
charged with seeing that . . . valid claims may be recognized, invalid ones eliminated, and the
rights of the public preserved.”); see also Payne, 31 Fed. Cl. at 711 (holding that while normally
the United States Court of Federal Claims is “to determine questions of ownership as an incident
to determining a takings claim,” Congress has given “Interior the power in the first instance to
inquire into the validity of mining rights claimed against the Government”); see also Hafen, 30
Fed. Cl. at 473 (“The determination of the validity of claims against the public lands has been
entrusted to the Department of the Interior since its creation in 1849.”). The established test to
determine validity of a mining claim is that “it must be of such a character that ‘a person of
ordinary prudence would be justified in the further expenditure of his labor and means, with a
reasonable prospect of success, in developing a valuable mine.’” Hafen, 30 Fed. Cl. at 473
(quoting Chrisman, 197 U.S. at 322).
Ripeness is rooted both in constitutional and prudential considerations. See State Farm
Mut. Auto. Ins. Co. v. Dole, 802 F.2d 474, 479 (D.C. Cir. 1986), cert. denied, 480 U.S. 951(1987) (explaining that ripeness is determined both by “the Article III requirement of a ‘case or
controversy’ and prudential considerations favoring the orderly conduct of the administrative and
judicial processes”). For these reasons, the United States Court of Appeals for the Federal
Circuit has explained that “a claim that government regulation has taken the economic viability
of a property ‘is not ripe until the government entity charged with implementing the regulations
has reached a final decision regarding the application of the regulations to the property at issue.’”
Stearns, 396 F.3d at 1358 (quoting Williamson Cnty. Reg’l Planning Comm’n, 473 U.S. at 186);
see also Washoe Cnty. v. United States, 319 F.3d 1320, 1324 (Fed. Cir. 2003) (“Takings claims
arising from the application of government regulations are not ripe until the government entity
charged with implementing the regulation has reached a final decision.”). But, “a claimant must
have first ‘followed reasonable and necessary steps to allow regulatory agencies to exercise their
full discretion’ so that the extent of the restriction on property is known.” Washoe Cnty., 319
F.3d at 1324 (quoting Palazzolo, 533 U.S. at 620–21). In the realm of takings jurisprudence,
ripeness is of paramount importance, because the court “cannot determine whether a regulation
has gone ‘too far’ unless it knows how far the regulation goes.” MacDonald, 477 U.S. at 348;
see also Mehaffy v. United States, 98 Fed. Cl. 604, 612 (2011) (stating that finality, and therefore
ripeness, “is compelled by the nature of the takings inquiry”).
As a matter of law, without a VER determination from either the BLM or Forest Service,
Plaintiff cannot establish, even at this preliminary procedural stage, that it possesses a
protectable property interest in the 678 unpatented mining claims since “a compensable interest
in unpatented mining claims [requires a] . . . determination as to the validity of those mining
claims.” Holden, 38 Fed. Cl. at 735; see also Best, 371 U.S. at 336 (holding that unpatented
mining claims are “valid against the United States if there has been a discovery of mineral within
the limits of the claim” and explaining that such determinations are entrusted to the Department
of the Interior (emphasis added)); Payne, 31 Fed. Cl. at 710–11 (same); Hafen, 30 Fed. Cl. at 473
(same). Plaintiff is incorrect that a table in a October 27, 2011 Final Environmental Impact
Statement estimating undiscovered uranium endowment in the Withdrawal Area is an
“acknowledge[ment of] the existence of valuable mineral deposits under [Plaintiff’s] claims.”
Pl. Resp. 10. That document does not circumvent the BLM’s responsibility to make a
15
determination of the validity of unpatented mining claims. See Holden, 38 Fed. Cl. at 735; see
also Skaw, 13 Cl. Ct. at 29 (“The function of the Government mineral examiner is . . . to
verify . . . whether the claimant has, in fact, found a valuable mineral deposit.”).
The absence of a compensable property interest has been recognized as grounds for
dismissal under RCFC 12(b)(1) and 12(b)(6). Compare Hafen, 30 Fed. Cl. at 474 (dismissing
takings claim premised on unpatented mining claims for lack of subject matter jurisdiction,
because “plaintiff ha[d] no valid existing right” in the claims) and Payne, 31 Fed. Cl. at 712
(concluding that the absence of “an examination of the validity of the mining claims at issue”
divested the court of jurisdiction and warranted a stay of proceedings), with Holden, 38 Fed. Cl.
at 735–36 (concluding that the lack of a VER determination from the BLM did not divest the
court of jurisdiction, but precluded plaintiffs from “stat[ing] a claim for relief under the Fifth
Amendment”) and Ford v. United States, 101 Fed. Cl. 234, 238 (2011) (explaining that
plaintiff’s failure to establish a valid property interest would warrant dismissal for failure to state
a claim upon which relief can be granted). As the United States Court of Federal Claims has
determined:
Because the plaintiffs have never requested that the BLM determine the validity
of their mining claims, their taking action does not rely on any determination that
they have a compensable interest in the unpatented mining claims. Without a
determination as to the validity of the plaintiffs’ unpatented mining claims, those
mining claims do not constitute a compensable property interest, and, therefore,
the plaintiffs cannot recover in this [c]ourt under a taking theory.
Holden, 38 Fed. Cl. at 736.
In this case, Plaintiff failed to obtain a VER determination and consequently has no
property right. Plaintiff therefore cannot show an entitlement to relief. See Am. Pelagic Fishing
Co., 379 F.3d at 1372 (“If the claimant fails to demonstrate the existence of a legally cognizable
property interest, the [court’s] task is at an end.”); see also Holden, 38 Fed. Cl. at 736 (holding
that an owner of unpatented lode mining claims who asserted the Government’s “closure of lands
on which [his] unpatented mining claims were located constituted a taking” did not state a claim
for relief because the BLM had not made a determination as to the validity those claims).
Plaintiff’s takings claims also must be dismissed, pursuant to RCFC 12(b)(1), because
those claims are not ripe for adjudication. The Withdrawal Order explicitly provides that it does
not impact claimants with valid existing rights. See Withdrawal Order, 77 FED. REG. at 2,563
(“This order withdraws approximately 1,006,545 acres of public and National Forest System
lands from location and entry under the Mining Law of 1872, . . . subject to valid existing
rights.” (emphasis added)). Unless and until Plaintiff receives a VER determination, neither the
BLM, the Forest Service, nor this court can determine if and how the Withdrawal Order will
impact Plaintiff’s unpatented mining claims. See Stearns, 396 F.3d at 1358 (A takings claim “‘is
not ripe until the government entity charged with implementing the regulations has reached a
final decision regarding the application of the regulations to the property at issue.’” (quoting
Williamson Cnty. Reg’l Planning Comm’n, 473 U.S. at 186)). Before Plaintiff may bring a
takings claim in the United States Court of Federal Claims, the BLM and Forest Service must be
16
given “the opportunity, using [their] own reasonable procedures, to decide and explain the reach
of the challenged regulation.” Palazzolo, 533 U.S. at 620; see also United States v. Riverside
Bayview Homes, Inc., 474 U.S. 121, 126 (1985) (“[T]he mere assertion of regulatory jurisdiction
by a governmental body does not constitute a regulatory taking.”); Stearns, 396 F.3d at 1358(holding that a takings claim was not ripe because the claimant had not pursued relief that was
equivalent to a VER determination); Benchmark Res. Corp. v. United States, 74 Fed. Cl. 458,
463 (2006) (“A plaintiff is not entitled to seek judicial review before following the prescribed
administrative procedures.”). This is not a case where “the permissible uses of the property are
known to a reasonable degree of certainty.” Palazzolo, 533 U.S. at 620. Nor is this case one
where the Government “has not identified any further administrative step available” to Plaintiff.
Washoe Cnty., 319 F.3d 1320. Instead, Plaintiff declined to follow a fundamentally reasonable
and necessary procedure that will allow the BLM and Forest Service “‘to exercise their full
discretion’ so that the extent of the restriction on property is known.” Washoe Cnty., 319 F.3d at
1324 (quoting Palazzolo, 533 U.S. at 620–21).
Plaintiff’s remaining arguments against dismissal also lack merit. As an initial matter,
the court is not obligated to accept the factual averments in the June 21, 2013 Complaint when
ascertaining whether this dispute is ripe for adjudication. See Reynolds, 846 F.2d at 747 (“If a
motion to dismiss for lack of subject matter jurisdiction . . . challenges the truth of the
jurisdictional facts alleged in the complaint, the [trial] court may consider relevant evidence in
order to resolve the factual dispute.”). Further, the fact that Plaintiff’s unpatented mining claims
are centered on brecchia pipes that are “likely to contain mineralization” does not excuse
Plaintiff from compliance with the VER determination process, since “Congress has given the
Department of Interior the power in the first instance to inquire into the validity of mining rights
claimed against the Government.” Payne, 31 Fed. Cl. at 711. Although Plaintiff invokes Abbott
Laboratories, that case held that ripeness must be discerned by evaluating “the fitness of the
issues for judicial decision and the hardship to the parties of withholding court consideration.”
Abbott Labs., 387 U.S. at 149. In this case, analysis of Plaintiff’s takings claim involves highly
factual determinations where “further administrative proceedings are contemplated,” as opposed
to the kind of “purely legal” issues that Abbott held were sufficiently ripe for adjudication. Id.This case also invokes Abbott’s warning that ripeness is designed “to prevent the courts, through
avoidance of premature adjudication, from entangling themselves in abstract disagreements over
administrative policies . . . [and from interfering with agency decision making] until an
administrative decision has been formalized[.]” Id. at 148.
Although Plaintiff cites to the court’s determination in Yount that a challenge to the
Withdrawal Order under the APA was ripe for adjudication, that decision has no preclusive
effect here. For collateral estoppel to apply, the issue in this case must be “identical to [the
issue] decided in the first action.” Laguna Hermosa Corp., 671 F.3d at 1288. The District Court
found that challenges to the Withdrawal Order on statutory and regulatory grounds were ripe for
adjudication. See Yount, 2013 WL 93372, at *14. That determination, however, is wholly
distinct from one that Plaintiff’s takings claims under the Fifth Amendment are ripe for
adjudication. See Laguna Hermosa Corp., 671 F.3d at 1288 (holding that issues were not
identical for purposes of issue preclusion because in one case, the court was required to interpret
a particular statutory word, whereas in the other, that analysis was unnecessary); see also In re
Freeman, 30 F.3d 1459, 1465 (Fed. Cir. 1994) (“[A]pplication of issue preclusion centers around
whether an issue of law or fact has been previously litigated.”).
17
Finally, while Plaintiff decries the January 18, 2012 Withdrawal Order as imposing a new
and materially different regulatory scheme, the requirement to obtain a VER determination on
lands that are withdrawn from appropriation under the Mining Law of 1872 is of relatively
longstanding nature. As an initial matter, the BLM published a Final Rule formally imposing
this requirement on November 21, 2000, over eleven years prior to the Withdrawal Order. See
Mining Claims Under the General Mining Laws; Surface Management, 65 FED. REG. at 70,025
(promulgating the BLM Final Rule requiring mining operators to obtain a VER determination
prior to receiving approval for a plan of operations on withdrawn or segregated lands).
Furthermore, as comments accompanying the November 21, 2000 Final Rule demonstrate, both
the Forest Service and BLM had imposed this same requirement, as a matter of policy, prior to
November 21, 2000. Id. at 70,026 (explaining that, even though “[b]oth the Forest Service and
BLM already generally do, as a matter of policy, require VER examinations when operations are
proposed on lands that have been withdrawn or segregated,” the BLM “believes that this policy
should be embodied in regulations so that all affected interests are fully aware of it, and to
assure that mining operations don’t proceed in segregated or withdrawn areas unless valid
existing rights are present.” (emphasis added)). As an experienced mining operator, Plaintiff
was or should have been aware of this requirement.
For these reasons, the court has determined that Plaintiff’s takings claims must be
dismissed, without prejudice.
2. Whether The Court Has Jurisdiction To Adjudicate Plaintiff’s
Estoppel Claim.
a. The Government’s Argument.
The Government posits several reasons for why the court also does not have jurisdiction
to adjudicate Plaintiff’s “estoppel” cause of action. First, to establish jurisdiction under the
Tucker Act, Plaintiff must establish a “federal law, regulation, [constitutional provision], or
contract that ‘mandat[es] compensation’ by the United States for ‘money damages[.]’” Gov’t
Mot. 18 (quoting Mitchell, 463 U.S. at 216–17; see also Jan’s Helicopter Serv., Inc. v. FAA, 525
F.3d 1299, 1306–07 (Fed. Cir. 2008) (holding that jurisdiction under the Tucker Act requires a
“money-mandating” source of federal law creating a right to “money damages against the United
States”)). Since the June 21, 2013 Complaint does not incorporate or reference any federal law,
regulation, or contract requiring the Government to pay money damages for refusing to allow
Plaintiff to mine on federal lands subject to the Withdrawal Order, the court does not have
jurisdiction over Plaintiff’s estoppel cause of action. Gov’t Mot. 18.
Second, even if Plaintiff properly pled a money-mandating provision of federal law in the
Complaint, estoppel may not be asserted against the Government “where, as here, [P]laintiff
requests monetary damages but (1) does not adduce a written contract prohibiting the alleged
federal misconduct allegedly causing these damages, on which [P]laintiff allegedly relied and (2)
alleges damages from federal actions that, if they occurred, would violate federal law.” Gov’t
Mot. 18–19 (citing Frazer v. United States, 288 F.3d 1347, 1352–53 (Fed. Cir. 2002) (explaining
that the doctrine of equitable estoppel is not available in suits seeking money damages from the
Government “where payment would contravene a statutory appropriation”) (quoting Office of
Pers. Mgmt. v. Richmond, 496 U.S. 414, 423–24 (1990)); see also Burnside–Ott Aviation
18
Training Ctr., Inc. v. United States, 985 F.2d 1574, 1581 (Fed. Cir. 1993) (observing that
equitable estoppel may be available against the Government where a plaintiff’s claim is based on
a purported breach of contract)). Plaintiff has not shown, however, any written contract
requiring the BLM or Forest Service to approve Plaintiff’s uranium mining. Gov’t Mot. 19. In
addition, without an approved plan of operations and a VER determination, it would be illegal
for Plaintiff to mine within the Withdrawal Area, and thus application of equitable estoppel
would result in actions that are “unauthorized under federal law.” Gov’t Mot. 19.
Third, Plaintiff’s estoppel cause of action, like the takings claims, is not ripe for
adjudication. Gov’t Mot. 19 (citing Texas v. United States, 523 U.S. 296, 300 (1998) (“A claim
is not ripe for adjudication if it rests upon contingent future events that may not occur as
anticipated, or indeed may not occur at all.” (internal citations and quotations omitted))).
Fourth, to the extent that the Complaint alleges an implied-in-fact contract cause of
action, the court does not have jurisdiction to adjudicate that claim for similar reasons.10
Plaintiff’s implied-in-fact contract theory does not rest on a federal law or contract that mandates
compensation by the Government. Gov’t Reply 15. Moreover, none of the sources Plaintiff
cited in order to buttress the implied-in-fact contract theory authorize Plaintiff to conduct mining
activities within the Withdrawal Area or “include[] a promise to pay [P]laintiff money if the
[Government] ever prohibits [Plaintiff] from doing so.” Gov’t Reply 15. Likewise, Plaintiff is
required to “link the ‘course of conduct’ on which it supposedly relied to an actual contract”
authorizing Plaintiff to mine within the Withdrawal Area. Gov’t Reply 15; see also id. 16
(stating that Plaintiff’s theory requires it to link “the federal representations which it claims to
have relied [on] to an actual contract allowing the particular mining activities that [P]laintiff
desires”). But, Plaintiff has failed to plead the requirements for an implied-in-fact contract,
which must allege “the same elements as an express contract.” Gov’t Reply 15 (quoting
Peninsula Group Capital Corp. v. United States, 93 Fed. Cl. 720, 731 (2010); see also
Sinclair v. United States, 56 Fed. Cl. 270, 277–78 (2003) (listing the requirements for an
implied-in-fact contract as “consideration, lack of ambiguity in offer and acceptance, mutuality
of intent to contract, and actual authority on the part of the agency representative to bind the
Government”)). Because Plaintiff’s implied-in-fact contract theory relies on unidentified
language in Section 304 of the AWA, mutuality of intent and consideration are lacking. Gov’t
Reply 15–16.
b. Plaintiff’s Response.
Plaintiff responds that the Complaint properly pled a “[p]romissory [e]stoppel [c]laim,”
based on the congressional determination in Section 304 of the AWA that the lands within the
Withdrawal Area are “eligible for mineral exploration” and therefore ineligible for withdrawal.
Pl. Resp. 15. In addition, the Government collected and continues to collect mining claim
maintenance fees from Plaintiff and other claimants with mining claims in the Withdrawal Area.
10
In the September 20, 2013 Response, Plaintiff attempts to recast the estoppel cause of
action in terms of an implied-in-fact contract. Pl. Resp. 15–16 (explaining that the
Government’s conduct “is sufficient to form the basis for an implied-in-fact contractual
obligation to leave the lands available for mineral exploration”).
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Pl. Resp. 15. This “conduct is sufficient to form the basis for an implied-in-fact contractual
obligation to leave the lands available for mineral exploration.” Pl. Resp. 15–16 (citing
Toon v. United States, 96 Fed. Cl. 288, 299 (2010) (explaining that Tucker Act jurisdiction
extends to implied-in-fact contracts, but that a “plaintiff must allege all the requisite elements of
a contract with the United States”)).
Plaintiff also contends that equitable estoppel may be asserted against the Government
where the claim is based on a breach of contract, but that there is no requirement “that the
contract be in writing.” Pl. Resp. 16. Plaintiff also reasons that the estoppel claim is ripe for
adjudication, because the Withdrawal Order is a final agency decision and “mineral
examinations . . . will not change the existence or extent of [Plaintiff’s] harm.” Pl. Resp. 16–17.
c. The Court’s Resolution.
Plaintiff’s estoppel claim is both ambiguous and inconsistently articulated. For example,
it is referred to as: (1) estoppel (Compl. 18); (2) promissory estoppel (Compl. ¶ 3); (3) equitable
estoppel (Compl. ¶ 69); and (4) and an implied-in-fact contract (Pl. Resp. 15–16).
Although the Complaint refers to the generalized concept of estoppel, that term, standing
alone, is ill-defined and nebulous. See RESTATEMENT (SECOND) OF CONTRACTS § 90 (“Estoppel
prevents a person from showing the truth contrary to a representation of fact made by him after
another has relied on the representation.”). Black’s Law Dictionary defines estoppel, generally,
as:
A bar that prevents one from asserting a claim or right that contradicts what one
has said or done before or what has been legally established as true. 2. A bar that
prevents the relitigation of issues. 3. An affirmative defense alleging good-faith
reliance on a misleading representation and an injury or detrimental change in
position resulting from that reliance.
BLACK'S LAW DICTIONARY 589–90 (8th ed. 2004).
These characterizations, however, are merely generic definitions for various iterations of
estoppel (i.e., promissory estoppel, collateral estoppel, and equitable estoppel), as evidenced by
the fact that Black’s Law Dictionary provides specific definitions for upwards of twenty-five
types of estoppel immediately thereafter. Id. Thus, while the Complaint generally alleges an
estoppel claim, the gravamen of Plaintiff’s second cause of action is either: promissory estoppel,
equitable estoppel, or breach of an implied-in-fact contract.
To the extent that Plaintiff’s claim is one for promissory estoppel, the United States Court
of Federal Claims does not have jurisdiction to adjudicate that claim, because promissory
estoppel “requires the court [to] find an implied-in-law contract, a claim for which the United
States has not waived its sovereign immunity.” Steinberg v. United States, 90 Fed. Cl. 435, 443
(2009); see also Hercules, Inc. v. United States, 516 U.S. 417, 423 (1996) (“[J]urisdiction [under
the Tucker Act] extends only to contracts either express or implied in fact, and not to claims on
contracts implied in law.”); Carter v. United States, 98 Fed. Cl. 632, 639 (2011) (“This court has
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no jurisdiction to hear a claim for promissory estoppel, and to the extent plaintiff substantively
asserts the elements for promissory estoppel, dismissal for lack of jurisdiction under 12(b)(1) is
appropriate.” (internal citation omitted)); Hubbs v. United States, 20 Cl. Ct. 423, 427 (1990)
(noting that “[p]romissory estoppel is another name for an implied-in-law contract claim”).
To the extent that Plaintiff claims an implied-in-fact contract arose from Section 304 of
the AWA, an unidentified 2008 Resource Management Plan “that classified the lands [within the
Withdrawal Area] as eligible for mineral exploration,” together with the Government’s collection
of maintenance fees, these contentions fall far short of a well-pled allegation of an implied-in-
fact contract sufficient for this court to exercise jurisdiction. Section 304 of the AWA provides:
The Congress hereby finds and directs that lands in the Arizona Strip District of
the Bureau of Land Management, Arizona, and those portions of the Starvation
Point Wilderness Study Area (UT–040–057) and Paria Canyon Instant Study Area
and contiguous Utah units in the Cedar City District of the Bureau of Land
Management, Utah, not designated as wilderness by this Act have been
adequately studied for wilderness designation pursuant to section 603 of the
Federal Land Policy and Management Act (Public Law 94–579) and are no longer
subject to the requirement of section 603(c) of the Federal Land Policy and
Management Act pertaining to the management of wilderness study areas in a
manner that does not impair the suitability of such areas for preservation as
wilderness.
AWA, Pub. L. 98-406, 98 Stat. 1485 § 304.
The Tucker Act authorizes the United States Court of Federal Claims to “render
judgment upon . . . any express or implied contract with the United States[.]” 28
U.S.C. § 1491(a)(1). But “jurisdiction under this provision requires . . . a non-frivolous
allegation of a contract with the [G]overnment.” Engage Learning, Inc. v. Salazar, 660 F.3d
1346, 1353 (Fed. Cir. 2011) (emphasis in original). In contrast, an implied-in-fact contract
“requires proof of (1) mutuality of intent, (2) consideration, (3) an unambiguous offer and
acceptance, and (4) actual authority on the part of the government’s representative to bind the
government in contract.” Kam-Almaz v. United States, 682 F.3d 1364, 1368 (Fed. Cir. 2012)
(quoting Hanlin v. United States, 316 F.3d 1325, 1328 (Fed. Cir. 2003)).
Plaintiff’s citation to Section 304 of the AWA is not an explicit promise to maintain the
Withdrawal Area for mineral extraction, nor constitutes an offer, as it does not reflect the
“manifestation of willingness [on the part of the Government] to enter into a bargain, so made as
to justify another person in understanding that his assent to that bargain is invited and will
conclude it.” RESTATEMENT (SECOND) OF CONTRACTS § 24. Nor does the Complaint sufficiently
allege consideration “in the form of a bargained-for exchange . . . that the promisee’s expectation
of performance is reasonable, and not disingenuous reliance on the words of a non-serious and
unwilling promisor.” Howell v. United States, 51 Fed. Cl. 516, 521 (2002).
Assuming, arguendo, that payment of fees to the Government may give rise to an
implied-in-fact contract, the court also does not have jurisdiction to adjudicate that claim because
21
Plaintiff has not asserted or otherwise demonstrated that this implied-in-fact contract “could
fairly be interpreted as contemplating money damages for [its] breach.” Holmes v. United States,
657 F.3d 1303, 1315 (Fed. Cir. 2011) (holding that it “was proper for the [United States Court of
Federal Claims] to require a demonstration that the agreements [allegedly breached by the
Government] could fairly be interpreted as contemplating money damages in the event of
breach”). Plaintiff’s implied-in-fact contract claim rests solely on an assumption that the
Government had an obligation to keep the lands within the Withdrawal Area open for mining
exploration and location, and that the Withdrawal Order breached that implied contractual
obligation. Pl. Resp. 15–16. Even if an implied contractual obligation of that nature existed,
Plaintiff has not alleged sufficient facts to suggest that the breach of this obligation could
reasonably be interpreted to contemplate monetary damages.
Moreover, any claim for breach of an implied-in-fact contract is insufficiently pled under
RCFC 8. See RCFC 8(a)(2) (requiring a “short and plain statement of the claim, showing that
the pleader is entitled to relief”); see also Iqbal, 556 U.S. at 679–80 (holding that facts
suggesting the “mere possibility of misconduct” do not “nudg[e] . . . [a plaintiff’s claim] across
the line from conceivable to plausible,” and are therefore insufficient to withstand a Rule
12(b)(6) motion to dismiss). The allegations at issue here demonstrate only that if the
Government makes a future negative VER determination, it may prohibit Plaintiff from mining,
and that the Government might be obligated to compensate Plaintiff monetarily. Such
allegations do not allow the court to draw “the reasonable inference that the [Government] is
liable” for breach of an implied-in-fact contract. Id. at 678.
To the extent that the Complaint alleges equitable estoppel, the United States Court of
Appeals for the Federal Circuit has held that “equitable estoppel is not necessarily unavailable as
a matter of law where the plaintiff’s claim is based upon an alleged breach of contract.” Frazer,
288 F.3d at 1353 (emphasis added). As discussed above, however, Plaintiff inadequately pled
the existence of a contract, and, even if an implied-in-fact contract existed, the court would not
have jurisdiction over that claim. Id.Further, “if equitable estoppel is available at all against the [G]overnment, some form of
affirmative misconduct must be shown in addition to the traditional requirements of estoppel.”
Zacharin v. United States, 213 F.3d 1366, 1371 (Fed. Cir. 2000) (collecting cases and explaining
that every court of appeals, including the United States Court of Appeals for the Federal Circuit,
has “held that affirmative misconduct is a prerequisite for invoking equitable estoppel against the
[G]overnment”). Interior’s promulgation of the Withdrawal Order was designed to protect the
Grand Canyon Watershed from the adverse effects of locatable mineral exploration and
development, and does not reflect Government misconduct. See Henry v. United States, 870
F.2d 634, 637 (Fed. Cir. 1989) (holding that IRS procedures, although “cumbersome and
inefficient,” coupled with representations that did not have the effect of misleading the plaintiff
on the specific question at issue, did not constitute affirmative misconduct); see also
Hanson v. Office of Pers. Mgmt., 833 F.2d 1568, 1569 (Fed. Cir. 1987) (holding that
Government officials’ incorrect advice that “receipt of the lump-sum [workers’ compensation]
benefit would not prevent [plaintiff] from receiving a civil service retirement annuity,” when in
fact it did, was not affirmative misconduct because Government officials acted in good faith).
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For these reasons, Plaintiff’s estoppel cause of action also must be dismissed.
III. CONCLUSION.
For these reasons, the Government’s August 20, 2013 Motion To Dismiss is granted.
Accordingly, the Clerk of Court is directed to dismiss the June 21, 2013 Complaint.
IT IS SO ORDERED.
/s
SUSAN G. BRADEN
Judge
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