United States District Court, D. Columbia
CONTINENTAL RESOURCES, INC., Plaintiff: Drew C Ensign,
Kenneth M. Simon, Sara Keyna Orr, LEAD ATTORNEYS, LATHAM &
WATKINS LLP, Washington, DC; L. Poe Leggette, LEAD ATTORNEY,
Rosario C. Doriott Dominguez, BAKER & HOSTETLER LLP, Denver,
SALLY JEWELL, Secretary, United States Department of the
Interior, GREGORY J. GOULD, Director, Office of Natural
Resources Revenue, United States Department of the Interior,
JAMES P. MORRIS, Supervisory Minerals Revenue Specialist,
Western Audit and Compliance, Management, Office of Natural
Resource Revenue, Western Audit and Compliance, OFFICE OF
NATURAL RESOURCES REVENUE, UNITED STATES DEPARTMENT OF THE
INTERIOR, Defendants: Jason Alan Hill, LEAD ATTORNEY, U.S.
DEPARTMENT OF JUSTICE, Washington, DC.
C. Lamberth, United Stated District Judge.
Continental Resources, Inc. (" plaintiff" ) filed
suit against defendants Sally Jewell, Secretary of the United
States Department of the Interior; Gregory J. Gould, Director
of the Office of Natural Resource Revenue, United States
Department of the Interior James P. Morris, Supervisory
Minerals Revenue Specialist, Western Audit and Compliance
Management, Office of Natural Resource Revenue, United States
Department of the Interior; Office of Natural Resources
Revenue; and United States Department of the Interior
(collectively " defendants" ) on January 16, 2014
challenging the " assessment of additional royalties by
the Officer of Natural Resources Revenue" of
$1,772,612.07 (plus interest) against plaintiff " in
connection with [plaintiff]'s extraction of natural gas
pursuant to federal leases." Compel., ECF No. 1.
Plaintiff filed its Amended Complaint on March 18, 2014
adding a fourth claim alleging violation of the Freedom of
Information Act, 5 U.S.C. § 522. Am. Compl., ECF No. 19.
Defendants filed this motion to Dismiss for Lack of
Jurisdiction on May 19, 2014. Mot. Dismiss, ECF No. 20.
Plaintiff filed it Memorandum in Opposition of
defendants' motion to dismiss on May 19, 2014. ECF No.
21. Defendants filed their reply to plaintiff's
memorandum on June 6, 2014. Reply Opp'n. Mot. Dismiss,
ECF No. 24.
alleges that defendants incorrectly assessed royalties
against plaintiff under 30 U.S.C. § 226 and brings
this action under the Administrative Procedure Act, 5 U.S.C.
§ § 701-706, " seeking vacatur of the
challenged final agency action, as well as declaratory and
injunctive relief" Compel., ECF No. 1 at 2. For reasons
stated in the complaint, plaintiff asserts that defendants
applied the statute and regulation's provisions
incorrectly in assessing royalties, resulting in assessing
higher royalties than appropriate under the law. Compel., ECF
No. 1 at 2-5. The intricacies of assessing royalties under 30
U.S.C. § 226, while central to the overall cause of
action, are not before the Court today in determining whether
to grant defendants' motion to dismiss plaintiff's
first, second, and third counts pursuant to Fed.R.Civ.P.
12(b)(1) and LCvR 7. Mot. Dismiss, ECF No. 20 at 1. Now
before the Court is defendants' motion, which turns
instead upon application of the Administrative Procedures
Act, 5 U.S.C. § § 701-706, and the Federal Oil and
Gas Royalty Management Act, 30 U.S.C. § §
1701-1759, as amended by the Royalty Simplification and
Fairness Act (hereinafter collectively, " Federal Oil
and Gas Royalty Management Act" ).
relevant background of this motion starts with defendant
Office of Natural Resources Revenue's order to "
Report and Pay Additional Royalties," issued on May 5,
2010. Mot. Dismiss, ECF No. 20 at 2. Plaintiff appealed the
order on June 10, 2010 under 30 C.F.R. § 290.
Id. Defendant Director of Office of Natural Resource
Revenue granted this appeal in part and rejected the
remainder on April 11, 2013. Exhibit 2 of Am. Compel., ECF
No. 19-2. Plaintiff appealed the Director's decision to
the Interior Board of Land Appeals on May 22, 2013. Mot.
Dismiss, ECF No. 20 at 2. On June 24, 2013, the Interior
Board of Land Appeals, " noted that more than 33 months
had passed since [plaintiff] had initiated its administrative
appeal process on June 10, 2010" and therefore issued an
order " to show cause why the appeal should not be
dismissed in light of the 33 month deadline" in the
Federal Oil and Gas Royalties Management Act and applicable
regulations found at 30 U.S.C. § 1724(h) and 43 C.F.R.
§ 4.904. Mot. Dismiss, ECF No. 20 at 2. Plaintiff
responded, stating that 33 months had passed as of June 17,
2013 depriving the Interior Board of Land
Appeals of jurisdiction by operation of law.
Plaintiff subsequently filed suit alleging three claims, the
fourth being added in the amended complaint. Compel., ECF No.
1 and Am. Compel., ECF No. 19.
plaintiff bears the burden of establishing that the court has
subject matter jurisdiction over its claim. See
Moms Against Mercury v. FDA, 483 F.3d 824, 376
U.S.App.D.C. 18 (D.C. Cir. 2007). Further, as noted generally
by defendants, " [a] party bringing suit against the
United States bears the burden of proving that the government
has unequivocally waived its immunity." Mot. Dismiss,
ECF No. 20 at 4 (citing Tri-State Hospital Supply Corp.
v. U.S., 341 F.3d 571, 358 U.S.App.D.C. 79 (D.C. Cir)
2003 (citations omitted)). In addition, " [w]hen
[sovereign immunity] waiver legislation contains a statute of
limitations, the limitations provision constitutes a
condition on the waiver of sovereign immunity."
United States v. Kubrick, 444 U.S. 111, 100 S.Ct.
352, 62 L.Ed.2d 259 (1979). The Court further extended this,
noting " although we should not construe such a time-bar
provision unduly restrictively, we must be careful not to
interpret it in a manner that would 'extend the waiver
beyond that which Congress intended." ' Block A.
North Dakota ex rel. Bd. Of University and School Lands,
461 U.S. 273, 287, 103 S.Ct. 1811, 75 L.Ed.2d 840 (1983)
(citing United States v. Kubrick, 444 U.S. 111,
117-118, 100 S.Ct. 352, 62 L.Ed.2d 259 (1979) (citation
omitted)). In the instant case, determination of
subject-matter jurisdiction depends upon the time limitation
provided by the Federal Oil and Gas Royalty Management
Act and specifically when the 180 day filing period provided
by § 1724(j) ends.
Requirements Under The Administrative Procedures Act
fully examine defendants' motion, the Court must first
turn to the mechanism of plaintiff's suit, which is the
Administrative Procedures Act. 5 U.S.C. § §
701-706. The Administrative Procedures Act allows judicial
review of, " [a]gency action made reviewable by
statute..." except " to the extent that... statutes
preclude judicial review." 5 U.S.C. § § 704
and 701. Therefore, plaintiff would need to show a waiver of
sovereign immunity and final agency action, in order for the
Court to have jurisdiction. Defendants do not challenge the
waiver of sovereign immunity other than for timeliness of
plaintiff's claim. Nonetheless, the Court examines both.
Waiver of Sovereign Immunity and Timeliness Under The Federal
Oil and Gas Royalty Management Act
relies upon the Federal Oil and Gas Royalty Management
Act's waiver of sovereign immunity. 30 U.S.C. §
§ 1701-1759. The Federal Oil and Gas Royalty Management
Act sets the time for judicial review of an agency
determination " within 180 days from receipt of notice
by the lessee or its designee of final agency action."
§ 1724(j). The Act further discusses when failure to
issue a decision may constitute final agency action at §
1724(h) where it states in pertinent part:
[i]f no such decision has been issued by the Secretary within
the 33-month period referred to in paragraph (1)--...
(B) the secretary shall be deemed to have issued a final
decision in favor of the Secretary, which decision shall be
deemed to affirm those issues for which the agency rendered a
decision prior to the end of such period, as to any monetary
obligation the principal amount of which is $10,000 or more,
and the appellant shall have a right to judicial review of
such deemed final decision in accordance with Title A.
however, rightly notes that the 33-month period discussed
above, " may be extended by any period of time agreed
upon in writing by the Secretary and the appellant."
§ 1724(h)(1). In order to determine whether the Federal
Oil and Gas Royalty Act provides the needed waiver of
sovereign immunity, the Court must determine whether suit was
filed timely as required by the statutory provisions above.
The Court must first determine whether defendants'
interpretation will be entitled to deference.