[00:00:00] Speaker 03:
All right, our next case for argument is 22-2086 Great Northern Properties versus United States.

[00:00:08] Speaker 03:
Mr. Adams, please proceed.

[00:00:10] Speaker 00:
Thank you, Your Honors, and may it please the court.

[00:00:11] Speaker 00:
I'm Chad Adams.

[00:00:12] Speaker 00:
I'm here with my partner, Steve Wade, and also Kai Shaw from Great Northern Properties, the president and CEO of that company.

[00:00:20] Speaker 00:
We're asking the court today to reverse the order and judgment of the Court of Federal Claims that dismissed Great Northern Takings complaint.

[00:00:28] Speaker 00:
And while the issues are addressed in the briefing and a number of reasons to reverse and to remand the case exists there, I want to focus on a few of the arguments that were made.

[00:00:40] Speaker 00:
And the first is a procedural one.

[00:00:42] Speaker 00:
This court, in 1985, issued its first decision in the Whitney Benefits case.

[00:00:48] Speaker 00:
And I think the Whitney Benefits cases are probably the most important precedent for the court to review in considering this appeal.

[00:00:55] Speaker 01:
Well, except they have nothing to do with whether it was state action or federal action.

[00:01:00] Speaker 00:
Well, I think, Your Honor, a close reading of the initial Whitney Benefits decision shows a template or a pattern of what needs to be pled to survive dismissal.

[00:01:11] Speaker 00:
And the facts in that case were very similar to what we have here.

[00:01:16] Speaker 00:
The facts in that case were that the state of Wyoming made the decision to deny the permit that Whitney Benefits sought in that case.

[00:01:24] Speaker 00:
And it was pursuant to a federally approved state program.

[00:01:29] Speaker 00:
that came out after the Service Mind Act was in effect.

[00:01:33] Speaker 00:
That's the same issue that we have here, where Montana enacted a state-run program.

[00:01:39] Speaker 01:
You found that the denial of the permit was mandated by the statute?

[00:01:45] Speaker 00:
Correct.

[00:01:45] Speaker 00:
And the ABF implementation of the ABF regulations and the impossibility of obtaining a permit are mandated by the same statute in Great Northern's case.

[00:01:58] Speaker 00:
Yeah, I mean, without the enactment of the Service Mining Control and Reclamation Act, Great Northern would have been able to mine it.

[00:02:09] Speaker 00:
There wouldn't have been the Olivia Valley floor regulations in place.

[00:02:15] Speaker 00:
Looking at the Whitney benefits decision, it's to set forth the template or the pattern that we followed in filing this complaint.

[00:02:23] Speaker 00:
I think this court emphasized in the 1985 Whitney benefits decision repeatedly the general rule that it's difficult

[00:02:32] Speaker 00:
in a rare case where dismissal would be appropriate in takings complaint because of the factual nature of those claims.

[00:02:42] Speaker 00:
And we're here to ask the court for remands so we have the opportunity to go back to do discovery and to present those facts, the same that many benefits was able to do in their case.

[00:03:00] Speaker 00:
And I think really reviewing the first Whitney benefits decision and comparing it to the facts that we've made in this case, I think it's an impossibility to reconcile those two decisions.

[00:03:11] Speaker 02:
But didn't Whitney benefit involve federal action?

[00:03:15] Speaker 02:
I mean, was it state action?

[00:03:17] Speaker 00:
Whitney benefits involved the same action that took place here.

[00:03:21] Speaker 00:
No.

[00:03:22] Speaker 01:
Whitney benefits relied on the fact that the statute, when it was enacted, mandated the denial of this particular permit.

[00:03:31] Speaker 00:
And so I think if you read both of the Whitney Benefits decisions together, it shows that there was a finding that the reason the permit was denied was because implementation of the Olivia Valley Court regulations.

[00:03:44] Speaker 00:
I mean, that is the reason Whitney Benefits was not able to operate.

[00:03:48] Speaker 00:
the same reason that Great Northern has not been able to operate in Montana.

[00:03:53] Speaker 00:
And it isn't.

[00:03:53] Speaker 01:
There's no discussion in that case about state versus federal action, right?

[00:03:57] Speaker 00:
I think, well, in the facts in the initial Whitney Benefits decision, there is discussion of that.

[00:04:03] Speaker 00:
And it discusses that it was the state of Wyoming that the permit application went to.

[00:04:09] Speaker 01:
But there was no argument in that case that it was state action rather than federal action.

[00:04:13] Speaker 01:
And that question wasn't addressed or resolved by the case, right?

[00:04:17] Speaker 00:
I think the court just

[00:04:18] Speaker 00:
Well, the answer is yes, right?

[00:04:23] Speaker 01:
It did discuss that issue.

[00:04:26] Speaker 01:
It didn't report to resolve that issue, right?

[00:04:29] Speaker 00:
It didn't directly address it.

[00:04:30] Speaker 00:
I think the court assumed and the government assumed at the time that it was what was obvious, is the federal statute and the implementation of the federal regulations.

[00:04:40] Speaker 02:
Did any of the parties argue it?

[00:04:43] Speaker 02:
I don't was it argued it wasn't argued.

[00:04:45] Speaker 00:
I don't believe that it was.

[00:04:46] Speaker 03:
Okay.

[00:04:47] Speaker 03:
I guess I thought that it was the enactment of the SMCRA that was alleged to be the taking.

[00:04:56] Speaker 00:
So they.

[00:04:57] Speaker 00:
They did discuss that, but they also said that either the enactment is when the taking would have took place or some subsequent event.

[00:05:04] Speaker 03:
I mean, even in page 1172, footnote number four in the Whitney benefit case, it said Whitney could even need to apply for a state permit.

[00:05:12] Speaker 03:
That wasn't even necessary for their takings claim.

[00:05:16] Speaker 03:
So it can't be the state action in the Whitney benefit case if the application of the permit wasn't even a necessary component of the taking allegation.

[00:05:24] Speaker 00:
Well, the only reason that they didn't need to apply for the permit was because, according to the Service Mining Act, obtaining a permit is an impossibility if the AVF determination is made, that there's an AVFC with a significant impact on agriculture.

[00:05:40] Speaker 00:
Otherwise, there would have been no reason that they wouldn't have been able to obtain the permit.

[00:05:45] Speaker 01:
Well, moving on, how is this case different from B&G?

[00:05:50] Speaker 00:
From B&G?

[00:05:52] Speaker 00:
So we set forth a number of reasons in our briefing, which included that in B&G, it was optional for the state to apply the regulations related to vending machines, right?

[00:06:05] Speaker 00:
And there is no option for the state of Montana here.

[00:06:10] Speaker 01:
I didn't have to enact the statute.

[00:06:13] Speaker 01:
They could have not acted, and then the feds would have stepped in.

[00:06:17] Speaker 00:
Well, yeah, that's the result.

[00:06:18] Speaker 00:
So in B&G, that wasn't what would happen.

[00:06:21] Speaker 00:
The feds wouldn't have stepped in and done anything.

[00:06:23] Speaker 00:
In B&G, it was Congress using a carrot, right?

[00:06:27] Speaker 00:
And saying, if you enact these regulations or if you enact this statutory program, you'll be rewarded with some benefit, with money in that case.

[00:06:37] Speaker 00:
Here, that's not what would happen.

[00:06:38] Speaker 00:
This is a way more coercive statute.

[00:06:41] Speaker 00:
where either the state of Montana adopts its own program that's sort of its own program.

[00:06:50] Speaker 00:
overseen and controlled by the federal government, no question about that from smack their phone language, but it's not an incentive approach, it's one that says either the state can do this and cooperate with the federal government on some of these issues or the federal government will step in and do it whether you like that or not.

[00:07:11] Speaker 00:
That's the main difference between this issue and the B&G case.

[00:07:16] Speaker 00:
And the extent of the control that the government, the federal government has.

[00:07:20] Speaker 01:
So here is in B and G there was prior state regulation permitting requirement, right?

[00:07:26] Speaker 00:
Yes.

[00:07:27] Speaker 01:
Yes.

[00:07:28] Speaker 00:
In B and G?

[00:07:29] Speaker 01:
Here.

[00:07:31] Speaker 01:
There was prior state legislation requiring permits.

[00:07:35] Speaker 00:
There was very recent prior state regulation.

[00:07:37] Speaker 01:
No, no, before the federal statute was enacted.

[00:07:40] Speaker 00:
Yeah, very recently, before the federal statute was enacted, there was a permit regulation, but it did not include the AVF regulations.

[00:07:49] Speaker 00:
It did not include other issues that were adopted at the same time because of the enactment.

[00:07:53] Speaker 01:
And when Montana changed and adopted the new statute, they said,

[00:08:01] Speaker 01:
This is similar to the federal.

[00:08:03] Speaker 01:
Our approach has been similar to the federal approach.

[00:08:05] Speaker 01:
And in fact, the federal approach has adopted some of our features of our approach, right?

[00:08:11] Speaker 00:
That's sort of what they said.

[00:08:12] Speaker 00:
What they wanted to make very clear, and did in the legislative history, and also in very recent Montana Supreme Court case, Westmoreland, was that Montana was adopting its changes in 1979 only to adopt the very minimum regulations required by the federal SMACRA Act.

[00:08:33] Speaker 00:
And they did not want to extend further than that.

[00:08:36] Speaker 00:
They haven't extended beyond that.

[00:08:38] Speaker 00:
Their AVF regulations are identical to what the federal act requires.

[00:08:42] Speaker 00:
And they've been adamant about that.

[00:08:47] Speaker 00:
And I think an important thing for the court to consider with the adoption of the changes that took place in 1979 is

[00:08:57] Speaker 00:
What's discussed in Whitney Benefits at length is the compensation part of the statute, right?

[00:09:03] Speaker 00:
You can usually come to a takings complaint, and you have to look at all these facts and decide, you know, did a taking take place?

[00:09:09] Speaker 00:
This court in Whitney Benefits said in smacker in 30 USC 1260 B5, the exchange provision made that analysis of whether a taking occurred much easier, because it goes beyond regulation

[00:09:25] Speaker 00:
And what the court uses is the language that goes too far.

[00:09:29] Speaker 00:
And the language in that compensation statute is that the federal government would acquire

[00:09:36] Speaker 00:
the coal, private fee coal, that's no longer able to be mined because of the AVF regulations.

[00:09:43] Speaker 00:
So when the Montana legislature made these additional changes after SMACRA, they also adopted the same compensation provision that shows what compensation should take place when these takings occur.

[00:09:59] Speaker 00:
And they adopted the federal statute.

[00:10:01] Speaker 00:
It doesn't say Montana will pay a coal owner.

[00:10:05] Speaker 00:
It will be certified to the secretary of the Department of Interior that this person would be eligible, this owner would be eligible for compensation under the exchange provision there.

[00:10:17] Speaker 00:
And it's important to understand the federal government

[00:10:20] Speaker 00:
would not allow this program to go forward without its approval.

[00:10:25] Speaker 00:
They looked at, reviewed, had input in, and approved the Montana statute, and approved that language.

[00:10:31] Speaker 00:
And so when the state of Montana made these AVF determinations and the DEQ issued its AVF determinations, those were sent to the secretary.

[00:10:40] Speaker 00:
And there was no response back that said, no, we won't pay for these, or no, they're not eligible for the exchange program.

[00:10:46] Speaker 00:
Right?

[00:10:47] Speaker 00:
And so, statutorily, the federal government is smacker, and also with its express approval of the Montana program, and adoption of the Montana program.

[00:10:59] Speaker 01:
enactment of either the federal statute or the regulations was a taking.

[00:11:04] Speaker 01:
That would be time barred.

[00:11:06] Speaker 01:
You're arguing that this particular ruling by the Montana authorities applying state law was a taking, and there's been no approval or federal role in making that particular determination, right?

[00:11:23] Speaker 00:
So we are arguing that the implementation of those regulations resulted in the taking, not the enactment of the decision.

[00:11:33] Speaker 01:
It's the decision denying the permit here, which was rendered under state law.

[00:11:37] Speaker 00:
So here, there was actually no decision denying a permit.

[00:11:40] Speaker 00:
There was two decisions made that said there's an AVF with significant impact on agriculture, and therefore you're precluded from mining this coal.

[00:11:52] Speaker 00:
So it would be futile for us to ask for a permit.

[00:11:55] Speaker 00:
Kind of the same argument that Whitney Benefits ended up making.

[00:12:03] Speaker 03:
Do you want to save your remaining time for rebuttal?

[00:12:05] Speaker 00:
I will.

[00:12:05] Speaker 00:
Thank you.

[00:12:06] Speaker 03:
Very good.

[00:12:18] Speaker 04:
Good morning.

[00:12:19] Speaker 04:
May it please the court.

[00:12:20] Speaker 04:
Amber Blaha for the United States.

[00:12:23] Speaker 04:
Great Northern's takings claim fails because it does not allege a single action taken by the United States in the last 40 years relating to their property.

[00:12:33] Speaker 04:
Instead, it seeks to hold the United States liable for a decision made by the Montana Department of Environmental Quality exclusively under Montana law.

[00:12:41] Speaker 04:
So I'd like to address first the lack of any federal action.

[00:12:44] Speaker 04:
I'm happy to address any questions about the other alternative grounds that the court could use to uphold the dismissal of the case as well.

[00:12:53] Speaker 04:
So it's axiomatic that in order for this court to have jurisdiction or to state a claim under the Tucker Act, Great Northern needs to allege some specific action taken by the United States that took their property.

[00:13:07] Speaker 04:
The only action taken by the United States alleged in the complaint is the passage of SMACRA 46 years ago.

[00:13:15] Speaker 04:
I think the best evidence of the action they do allege that took their property is the alluvial floor determination that's in the appendix.

[00:13:28] Speaker 04:
And I think that document is really the best evidence of how there was no federal involvement in the key decision that they think took their property.

[00:13:36] Speaker 03:
They have and can't challenge the enactment of the statute, right?

[00:13:38] Speaker 04:
Correct.

[00:13:39] Speaker 03:
That's all time bars, so they can't make that challenge.

[00:13:41] Speaker 04:
Exactly.

[00:13:42] Speaker 03:
And in Whitney, too, am I correct in saying that the challenge, the taking challenge there was to the enactment of the statute?

[00:13:50] Speaker 04:
That claim, yes.

[00:13:52] Speaker 04:
I think so.

[00:13:53] Speaker 04:
And I think this is in Whitney 1.

[00:13:56] Speaker 04:
It's very clear that the plaintiff there was a legislative taking.

[00:14:01] Speaker 04:
That claim, the case of Whitney Benefits, was brought within six years of the passage of SMACRA.

[00:14:07] Speaker 04:
And both of those cases were really all about whether it was SMACRA itself that took Whitney Benefits property.

[00:14:16] Speaker 01:
The government, I believe, in that case- It wasn't dealt with this particular permit situation.

[00:14:20] Speaker 01:
Because Congress considered this particular situation in enacting the statute.

[00:14:26] Speaker 04:
Congress considered Whitney benefits property.

[00:14:29] Speaker 04:
There was evidence in this court in Whitney benefits to relied very heavily on the fact that there was extensive evidence in the legislative history that Congress knew that the alluvial valley floor provision was going to directly affect Whitney benefits property.

[00:14:44] Speaker 04:
And so over the government's objections, actually, this court found that the statute itself in 1977 affected a taking of Whitney benefits property.

[00:14:55] Speaker 04:
It's very different here.

[00:14:56] Speaker 04:
We're 40 years down the road.

[00:14:58] Speaker 04:
There's no evidence.

[00:14:59] Speaker 04:
Nobody's pointed to any evidence that Congress knew specifically about, certainly, Great Northern's property.

[00:15:07] Speaker 04:
It's not clear.

[00:15:08] Speaker 04:
I don't think they even owned the property at the time of the passage of SMACRA.

[00:15:12] Speaker 04:
So on that basis alone, that was a key holding.

[00:15:16] Speaker 04:
I think the court used the term

[00:15:18] Speaker 04:
a key element of the case that SMACRA itself precluded mining in terms known to be applicable to the AVF overlying the Whitney Cole property.

[00:15:26] Speaker 04:
And it's a huge distinction.

[00:15:28] Speaker 04:
And it gave that court the federal action, and thus jurisdiction, and thus a cause of action.

[00:15:34] Speaker 04:
It's not present here.

[00:15:39] Speaker 04:
I was also speaking about the AVF determination itself, and that is there's not a single mention of federal law in it.

[00:15:49] Speaker 04:
It relies exclusively on Montana law.

[00:15:52] Speaker 04:
It relies on Montana regulations.

[00:15:54] Speaker 04:
While there is a lot of similarity between the Montana law and the federal standard, there are also some differences, particularly in Montana's regulations implementing the alluvial valley floor provision.

[00:16:06] Speaker 04:
They have their own

[00:16:07] Speaker 04:
requirements in place for what is required to be submitted as part of the application.

[00:16:13] Speaker 04:
It's a very fact-specific determination.

[00:16:17] Speaker 04:
Again, I commend that document.

[00:16:20] Speaker 04:
It's involved interviews with neighboring ranchers and there's an analysis of the geology.

[00:16:26] Speaker 04:
is both a technical evaluation and, I think, a judgment of the effects that the potential, essentially, dewatering of that watershed would have on those neighboring ranches.

[00:16:38] Speaker 04:
And there's no allegation, no evidence, no indication anywhere that there was any federal role in any of this.

[00:16:44] Speaker 04:
And so there's just simply no federal action that they pointed to in the complainer, really, in any subsequent briefing.

[00:16:55] Speaker 04:
I will turn briefly, they brought up and I think you raised the B&G case and sort of the issue of agency or coercion.

[00:17:03] Speaker 04:
I think that's absolutely absent here.

[00:17:06] Speaker 04:
Agency requires control.

[00:17:08] Speaker 04:
There's no indication that the federal government has control over Montana's actions.

[00:17:14] Speaker 04:
AVF determination itself, I think, is good evidence of this.

[00:17:18] Speaker 04:
While there is federal oversight, it is not the same as control.

[00:17:23] Speaker 04:
It is a backstop program that does not give the Office of Surface Mining, any federal agency, the ability to go in and redo AVF determinations.

[00:17:35] Speaker 04:
It didn't approve or review or

[00:17:38] Speaker 04:
direct in any way the AVF determination that was made here.

[00:17:41] Speaker 04:
So agency, I think there's just no allegation agency existed.

[00:17:49] Speaker 04:
I think also council puts too much weight on the exchange provision that's found in the statute.

[00:17:57] Speaker 04:
I note at the outset that was an argument not made below and so we believe it was forfeited.

[00:18:03] Speaker 04:
But even if this court were to consider it, that exchange provision is I think best seen as a potential benefit for

[00:18:11] Speaker 04:
persons who were impacted by the statute, and it's specifically described in the statute as part of a policy of Congress.

[00:18:23] Speaker 04:
It's not described as compensation.

[00:18:25] Speaker 04:
It's not monetary.

[00:18:26] Speaker 04:
It is just an opportunity to arrange an exchange with the federal government.

[00:18:31] Speaker 04:
So I don't think it is

[00:18:34] Speaker 04:
dispositive here and I should add it certainly doesn't excuse the requirement for federal action so even if it is you know was relevant in the Whitney benefits discussion because the court found that Congress itself with the passage of SMACRA had taken Whitney benefits property I don't think it can't create jurisdiction or a claim here.

[00:18:56] Speaker 04:
Anything further?

[00:19:04] Speaker 04:
Does the court have any questions on the alternative grounds for affirming?

[00:19:10] Speaker 04:
If not, I will.

[00:19:13] Speaker 03:
Okay, thank you, Ms.

[00:19:13] Speaker 03:
Blaha.

[00:19:14] Speaker 03:
Thank you.

[00:19:17] Speaker 03:
Mr. Adams, you have the bubble tie.

[00:19:21] Speaker 00:
Thank you, Your Honors.

[00:19:23] Speaker 00:
I want to address a couple of issues of what the federal government did.

[00:19:27] Speaker 00:
Initially, there's no question that it was the federal government that imposed AVF regulations that Montana had to comply with.

[00:19:35] Speaker 00:
Second, although it was represented that the federal government doesn't retain control, SMACR requires the federal government to maintain not only control over permitting decisions and implementation of the SMACR regulations.

[00:19:51] Speaker 00:
even under the Montana program, but ultimate control over those decisions that requires them to be reviewed by the Office of Surface Mining and for that office to come in and to take over the program if Montana is not complying with it.

[00:20:07] Speaker 01:
There really is no more... Take over the program but not change the individual decision.

[00:20:12] Speaker 00:
They would absolutely have to change the decision that was made and to reverse those decisions.

[00:20:17] Speaker 01:
No, no, but the statute provides that the feds can come in

[00:20:21] Speaker 01:
come in and take over the program.

[00:20:22] Speaker 01:
It doesn't provide for reversing the individual decision, right?

[00:20:27] Speaker 00:
I believe that it does.

[00:20:28] Speaker 00:
And what it says is not only if Montana is not complying with the state authorized program, but if Montana is not implementing the SMACRA regulations, then they come in required to... Where does the statute say they can change the individual decision?

[00:20:42] Speaker 00:
I believe that's 30 U.S.C.

[00:20:44] Speaker 00:
1270 and 1271.

[00:20:48] Speaker 00:
The result of those would be that they have to come in and review those decisions, correct any of the mistaken decisions, and to take over that program if the state's not going to comply.

[00:20:59] Speaker 00:
And then beyond that, the federal government determines who the regulatory authority is that would implement SMACRA, whether it would be the federal government or the state.

[00:21:08] Speaker 00:
They could reject Montana's program in total if they didn't agree with anything that was in or not in the statute.

[00:21:15] Speaker 00:
And importantly,

[00:21:18] Speaker 00:
It does say in the alluvial value forward determinations, does cite specifically to federal law, and cites to SMACRA, and it cites to the exchange provisions.

[00:21:28] Speaker 00:
And I think that is important because, as it says in Whitney benefits, that shows that a taking took place and a taking that needs to be compensated, where the federal government is going to acquire the problem.

[00:21:39] Speaker 00:
The federal government agreed to this, right, in the Montana statute and says, you know, if these regulations are put into effect, and coal owners precluded from mining, they'll be able to recover not under any Montana statute or against the state of Montana, but through the exchange program, which Lady Memphis said is one option or a takings complaint against the United States.

[00:22:04] Speaker 00:
And then finally I noticed on the way in in the lobby a book that was called Should Uncle Sam Pay?

[00:22:12] Speaker 00:
When and why?

[00:22:14] Speaker 00:
The decision or the answer to those questions are yes, Uncle Sam should pay and when as soon as possible and why is because for the same reasons that this court had addressed in the winning benefits decisions and the facts of the case.

[00:22:28] Speaker 03:
Thank you.