[00:00:00] Speaker 01: The next case is number 155084, Rio Force Incorporated against the United States. [00:00:08] Speaker 01: Mr. Stevens. [00:00:14] Speaker 00: May it please the court. [00:00:16] Speaker 00: October 94, Congress decides to give land to the state of California. [00:00:20] Speaker 00: And the state of California says it doesn't want the land if there are federal mining claims, because it doesn't allow mining in the parks. [00:00:28] Speaker 00: In August of 95, BLM decides how it's going to deal with mining claims on this land. [00:00:34] Speaker 00: And it's very important, because BLM is responsible for determining whether the claims are valid or not. [00:00:41] Speaker 00: And because a mining claim that is operational is more likely to have evidence of validity, because validity depends upon [00:00:53] Speaker 00: Is it economic? [00:00:54] Speaker 00: Is it a valuable deposit? [00:00:55] Speaker 00: And if you're in operation, you're presumably valid. [00:00:58] Speaker 00: So therefore, it was important, and in fact, in the MOU, says it was necessary to suspend plans of operations that have been approved that are not yet operational. [00:01:09] Speaker 01: How much weight do you put on the settlement agreement? [00:01:14] Speaker 01: Because, of course, they argue that when the dispute is finally settled with BLM, that [00:01:22] Speaker 01: Then there was a time period of activity which didn't take place. [00:01:28] Speaker 01: And that's a very simple way of looking at it. [00:01:33] Speaker 01: Does that not fit with your argument? [00:01:35] Speaker 00: Well, the problem with that is, and that was apparently the basis of the trial course decision on standing. [00:01:44] Speaker 01: Yes. [00:01:45] Speaker 01: Well, whatever it is as to how it came out and who won and lost. [00:01:50] Speaker 00: And the problem with it is that my client was engaging in mining activity pursuant to the settlement agreement, but there was not evidence presented on that because that was never raised before. [00:02:05] Speaker 00: And in fact, we went to trial based on Judge Fute's ruling on summary judgment that we in fact did have a property interest. [00:02:14] Speaker 00: And this was never raised before. [00:02:18] Speaker 00: There was not evidence about mining that happened post-settlement agreement, because our position was the critical question is, you need to own a property interest at the time of the taking and not at the time of filing suit. [00:02:36] Speaker 00: And the federal government has essentially agreed that Judge Braden got that question wrong in the final decision. [00:02:45] Speaker 00: So again, we think the focus is what is the time period in which Rio Force was stopped from mining, which was 95 to 2008. [00:02:54] Speaker 00: And when the temporary taking ended in 2008 with the settlement agreement, it really doesn't matter what happened after that. [00:03:02] Speaker 02: I want to talk to you about that memorandum of understanding, which you were about to talk about. [00:03:07] Speaker 02: So I understand that Judge Braden has said that it did not effectively deprive Rio Force of any right. [00:03:15] Speaker 02: I was just wondering, what do you think the standard of review is that applies to her reading of the memorandum of understanding? [00:03:23] Speaker 00: Well, I would normally say it's a clearly erroneous standard, because it is a question of fact. [00:03:29] Speaker 00: It is based upon, essentially, these written documents and the written statements, and oral statements as well. [00:03:39] Speaker 00: We're arguing that [00:03:41] Speaker 00: multiple BLM officials at multiple levels on multiple times said Rio Force could not mine until the valid existing rights determination was made. [00:03:51] Speaker 00: And there is no evidence that these officials weren't authorized to speak or that there was some other reason that Rio Force should not have trusted what was said over and over and over and over. [00:04:05] Speaker 04: That was 10 years later though, right? [00:04:06] Speaker 04: That was like in the [00:04:08] Speaker 04: 2003, 2004, 2005 era. [00:04:12] Speaker 04: And what we're trying to figure out is what did the MOU in 1995 do to Rio Force, if anything? [00:04:19] Speaker 04: And so when we look again at the facts on the ground in that time zone, we see that there was a letter from BLM to Rio Force just three weeks before the MOU came out stating that [00:04:37] Speaker 04: There's an MOU coming. [00:04:38] Speaker 04: It's not going to affect you, Rio Force. [00:04:41] Speaker 04: You will be able to keep doing what you have been doing under your approved plan of operation. [00:04:47] Speaker 04: And then when we look at the actual MOU, we see that there are a few different groups. [00:04:57] Speaker 04: One is for people with plans for exploration activities. [00:05:02] Speaker 04: And then there's other people that have plans for [00:05:06] Speaker 04: operating mines and your POO from the late 80s and early 90s was authorizing you to mine 200,000 tons annually. [00:05:20] Speaker 04: So it looks like to me that you had a clear lane of being a full-blown operating mine. [00:05:30] Speaker 04: Whether you chose to actually [00:05:33] Speaker 04: go to the limit of 200,000 tons or not is completely up to you. [00:05:37] Speaker 04: But I don't see how we can regard you as being approved merely for exploring. [00:05:47] Speaker 00: So I have two responses. [00:05:50] Speaker 00: One deals with the July 1995 letter. [00:05:53] Speaker 00: And again, as we've indicated in our briefs, that we've objected to the letter because we've never received it. [00:06:02] Speaker 00: It's an unsigned letter. [00:06:03] Speaker 00: It's not even on letterhead. [00:06:04] Speaker 00: But what I think more importantly is that that letter was talking about what was expected in an MOU. [00:06:10] Speaker 00: And it could not describe what the MOU actually said, because the MOU was not in existence. [00:06:18] Speaker 00: And we provided the trial court with all of the draft MOUs at the time. [00:06:23] Speaker 00: that indicate there was never a discussion about suspending plans of operations. [00:06:29] Speaker 00: And I think it's also important to look at Appendix 1100. [00:06:34] Speaker 00: There's a communication from Lynn Gum in the BLM office, who was the purported author of this letter. [00:06:42] Speaker 00: And he says, Rio Force was told in July of 95 that it could not mine until a validity exam was done. [00:06:50] Speaker 02: What about these different things, meeting minutes from the Marine Forces Board that show that in 1995 there was a discussion of plans to extract approximately 200 more tons of product in 1996? [00:07:06] Speaker 02: I mean, so how does that factor into it? [00:07:10] Speaker 02: That seems to be evidence that supports the determination below that the memorandum of understanding did not [00:07:18] Speaker 02: Prohibit reinforces mining activities. [00:07:20] Speaker 00: So the meeting minutes of the BLM Corporation indicate that they anticipated that they were going to be mining. [00:07:32] Speaker 00: Nobody understood. [00:07:33] Speaker 00: There's no evidence to indicate that somebody should have known this was going to last 13 years or 10 years or 9 years or 8 years. [00:07:40] Speaker 00: When there was a validity exam done before, it took less than two years when there was one done on the common-uncommon variety. [00:07:47] Speaker 00: That was done in 87, done in 89. [00:07:49] Speaker 00: There was no understanding that this was going to be a long, drawn-out process. [00:07:55] Speaker 00: And it only made sense that Rio Force would continue to plan, continue to get permits, continue to do marketing, and to do the same. [00:08:05] Speaker 00: Would you agree? [00:08:07] Speaker 00: I'm sorry. [00:08:07] Speaker 02: Go ahead. [00:08:07] Speaker 02: Would you agree that some plans of operation on their face are for mining, whereas others are for exploration? [00:08:17] Speaker 00: Absolutely not. [00:08:18] Speaker 00: And in fact, the BLM witness on that point was questioned at trial extensively on that. [00:08:25] Speaker 00: And he said there are not different plans for exploration and not. [00:08:31] Speaker 00: And that is cited in our brief. [00:08:33] Speaker 00: It was a testimony of Rob Laidwood. [00:08:35] Speaker 02: According to the regulations, it seems to use the words exploration and mining separately as meaning different things. [00:08:43] Speaker 02: Do you agree with that? [00:08:45] Speaker 00: Are there terms of art that have different meanings? [00:08:48] Speaker 00: Exploration is just one part of the concept of mining. [00:08:51] Speaker 00: I mean, I would agree that mining includes a lot of different things. [00:08:54] Speaker 00: And what's critical, and getting back to your other point about the MOU and talking about exploration, is that it says what we mean is not producing mines. [00:09:06] Speaker 00: Group two was for non producing mines and and again, I just cited the appendix 1100 where in 95 Rio Force was told that it couldn't be in production without validity examination and there were communications all the way through this time period that concluded that BLM was in group, excuse me, that Rio Force was in group two and [00:09:35] Speaker 00: that it could not commence mining until a VER was done. [00:09:39] Speaker 04: When you say communications all the way through this time period that informed Rio Force that it could not do any further mining from 1995 until there was a validity determination, what are you pointing at? [00:09:57] Speaker 04: Because I only saw a series of internal [00:10:03] Speaker 04: messages being sent inside of BLM eight, nine years after the fact. [00:10:08] Speaker 04: And then maybe one letter in 2003 or four from BLM to, I believe it was Simonson, suggesting something to that effect. [00:10:20] Speaker 04: But I didn't see anything in 95, 96, 97, 98, 99. [00:10:25] Speaker 00: So again, I just mentioned the July 1995 communication. [00:10:31] Speaker 00: there was the MOU itself that was given to everybody. [00:10:35] Speaker 04: Right, but we, I mean, the July 95 communication on its face doesn't say you can't do any more mining until after you get a validity determination. [00:10:47] Speaker 04: It says the opposite of that, that you will be able to keep going as hard as you want up to the limit until, you know, and then when we get a validity determination, we'll go from there. [00:11:01] Speaker 00: I'm sorry, I'm referring to appendix 1100, which is a different document in which BLM officials say, we told Mr. Simonson in July of 95. [00:11:12] Speaker 04: Right, but what date is that communication that you're referring to? [00:11:16] Speaker 00: It's July of 95. [00:11:18] Speaker 04: No, no. [00:11:19] Speaker 04: The communication you're saying that BLM official says that we told Simonson in July of 1995. [00:11:30] Speaker 00: Oh, the data, you're right, that is subsequent. [00:11:34] Speaker 04: Yeah. [00:11:34] Speaker 04: Yeah, when? [00:11:35] Speaker 00: Yes, I don't remember. [00:11:37] Speaker 04: I think it's like 2004 or something far later. [00:11:40] Speaker 00: 2006. [00:11:40] Speaker 04: 2006. [00:11:42] Speaker 04: Yes, could very well be. [00:11:43] Speaker 04: So that's the point I'm trying to make. [00:11:45] Speaker 04: You're right that there are some communications a decade later where BLM seems to be under the impression at that time that perhaps Simonson hasn't been [00:12:00] Speaker 04: mining for the past 10 years because BLM put Simonson into suspension until it got a validity determination. [00:12:12] Speaker 04: But when you look at the 1995 era itself, as we already talked about the July 95 letter, which I think speaks for itself, we look at the MOU and there is maybe a reading [00:12:26] Speaker 04: that supports you and says, well, they weren't really producing that much, so maybe it is Group 2. [00:12:31] Speaker 04: Then you look at Group 3 and you see, okay, these are people that have approved operating plans, and so therefore Simonson looks more like Group 3. [00:12:42] Speaker 04: Then you look at Simonson's group's activities in 1996 and 1997, where they are running around everywhere, trying to find investors, trying to find buyers, not really finding anybody, but they were actively [00:12:56] Speaker 04: looking at that present time to sell. [00:12:59] Speaker 04: They weren't talking about, well, as soon as we get our validity determination, then we can sell. [00:13:06] Speaker 04: They were looking for buyers right then and there. [00:13:08] Speaker 04: They were looking for people to invest with them right then and there. [00:13:14] Speaker 04: And they just weren't really getting anywhere, is what I seem to be seeing. [00:13:19] Speaker 04: And then things kind of go dormant for quite a period of time when it comes from [00:13:26] Speaker 04: whether it's Simonson or other players that were kind of moving in and out. [00:13:30] Speaker 04: And then it's really only 2003 where Simonson kind of all of a sudden now is interested in pursuing validity determination. [00:13:40] Speaker 00: So your honor, there's never been anyone to suggest that Simonson really was in group three. [00:13:45] Speaker 00: I mean, all of the communications are consistent that he was in group two. [00:13:49] Speaker 04: And again, those are the ones from a decade later. [00:13:53] Speaker 04: Yes, absolutely. [00:13:55] Speaker 04: That's fine. [00:13:58] Speaker 04: Maybe the record is mixed here and we have to figure out, was it clearly erroneous for the lower court to conclude that what happened with Rio Force was that the government actually had intervened and stopped Rio Force from doing something in 1995 and she made a finding that no, it wasn't that case. [00:14:22] Speaker 00: In August of 95, if Rio Forest, on notice of that MOU, that a VER had to be done, it would be running the risk of committing mineral trespass. [00:14:37] Speaker 00: And so it did not. [00:14:37] Speaker 00: I realized. [00:14:38] Speaker 04: What about the SMARA reclamation project approval that you needed from the state of California? [00:14:48] Speaker 04: Yes. [00:14:50] Speaker 04: In order to do any mining, [00:14:52] Speaker 04: after the MOU, did you need that SMARA approval? [00:15:01] Speaker 00: It's complicated because the SMARA requirement for an approval is only if you are disturbing an acre or more of the surface. [00:15:11] Speaker 00: And this is an underground mine. [00:15:12] Speaker 00: And so there was a determination that, no, you don't need one. [00:15:16] Speaker 00: And then later they came back and re-measured and said, oh, now you do. [00:15:21] Speaker 04: Because my understanding was in November of 95, you got a letter from BLM saying, you're going to need to get this SMARA approval. [00:15:29] Speaker 04: Yes. [00:15:30] Speaker 04: Because you're more than the acre and a half or whatever it is. [00:15:33] Speaker 04: Yes. [00:15:34] Speaker 04: And so go to California and get your SMARA approval. [00:15:38] Speaker 01: That's right. [00:15:38] Speaker 01: It was always more than an acre, was it not? [00:15:41] Speaker 01: I didn't get the impression that that was under dispute. [00:15:44] Speaker 00: No, it wasn't a dispute. [00:15:46] Speaker 00: There is evidence in the record that from California, they said, you don't need a SMARA permit. [00:15:53] Speaker 00: And there is that document. [00:15:55] Speaker 00: And then that was outremeasured and then changed. [00:15:58] Speaker 04: So I don't understand why it took until 2003 for this group to wait until getting the SMARA approval. [00:16:09] Speaker 00: Well, one, it took some time. [00:16:13] Speaker 00: and was still trying to, again, we're talking over five years later of waiting for the validity exam. [00:16:20] Speaker 00: And it just took some time to get that done, because it did not seem like anything, they hadn't even started the validity exam at that point. [00:16:29] Speaker 04: Had you made any request before 2003 to either ask for a SMARA approval or for a validity determination? [00:16:38] Speaker 00: I believe it started in 2001, but I don't have that [00:16:43] Speaker 00: Thank you. [00:16:45] Speaker 01: Commissioner Stevens, we'll save you rebuttal time. [00:16:47] Speaker 01: Thank you. [00:16:48] Speaker 01: Let's hear from the government. [00:16:52] Speaker 01: Mr. Beeler. [00:16:54] Speaker 03: Good morning. [00:16:55] Speaker 03: May it please the court? [00:16:57] Speaker 03: My name is Jeff Beeler. [00:16:58] Speaker 03: I am joined today by Matt Marinelli from the Department of Justice and Lauren Bachtel from Interior. [00:17:04] Speaker 03: We're here on behalf of the United States. [00:17:07] Speaker 03: I'd like to focus on what exactly Rio Force was told in 1995 because I think Judge Chen is on to something here. [00:17:15] Speaker 03: There were three letters. [00:17:16] Speaker 03: We discussed this in our brief. [00:17:18] Speaker 03: The first letter is a very specific letter. [00:17:20] Speaker 03: It's addressed to Mr. Simonson and it says, there's going to be this memorandum. [00:17:24] Speaker 03: It's coming out. [00:17:25] Speaker 03: You are allowed to continue operating under your approved plan of operations. [00:17:30] Speaker 03: Three weeks later, he gets another letter. [00:17:32] Speaker 03: It's a generic letter. [00:17:33] Speaker 03: It's sent to all [00:17:34] Speaker 03: possible mining claimants in the land that's going to be withdrawn and transferred to the state of California. [00:17:39] Speaker 03: That letter is, as it says in its purpose, it puts forth its agreement between the state of California and the federal government. [00:17:47] Speaker 03: It doesn't apply specifically to any particular mining claimant. [00:17:51] Speaker 03: It's just a generic letter letting them know what's going to be happening. [00:17:54] Speaker 03: That's then followed up with another letter in November of 1995, where the Bureau of Land Management again sends a specific letter to Mr. Simonson saying, [00:18:03] Speaker 03: Under your approved plan of operations, you are disturbing a certain amount of ground in order for you to mine, you need to get these SMARA permits from the state of California. [00:18:14] Speaker 03: Had the Bureau understood the memorandum that it had signed with the state of California to operate as some way of suspending Mr. Simonson and Reel Force's mining claims, why would it send another letter saying that they need to get this certification? [00:18:29] Speaker 03: There's no mention of suspension in there, and in fact, [00:18:33] Speaker 03: The trial court, when it looked at all the evidence that was submitted, it pointed to these letters, but it also pointed to the meeting minutes. [00:18:41] Speaker 03: And when you look at the meeting minutes, there's a bunch of them that were put into the record. [00:18:45] Speaker 03: None of those meeting minutes suggests anything was ever discussed among the shareholders, that mining operations had been suspended. [00:18:53] Speaker 03: In fact, as the court pointed out, the meeting minutes suggested they were trying to mine even more pumiceite. [00:18:58] Speaker 03: Why didn't they mine the pumiceite? [00:19:00] Speaker 03: They couldn't find buyers. [00:19:01] Speaker 03: No one wanted to buy that. [00:19:02] Speaker 03: That's in their meeting minutes. [00:19:04] Speaker 03: They also received a report from, I think it was one of their shareholders that told the board, Rio Force can continue to mine because the Bureau is satisfied. [00:19:12] Speaker 03: We can operate under our approved plan of operations. [00:19:16] Speaker 03: The trial court did exactly what it was supposed to do in this case. [00:19:19] Speaker 03: It submitted a bunch of evidence. [00:19:22] Speaker 03: Rio Force brought evidence of internal discussions that occurred, as Judge Chen pointed out, a decade later. [00:19:27] Speaker 03: These are internal emails within the Bureau. [00:19:30] Speaker 03: It's true that some of those suggest that there had been these communications. [00:19:34] Speaker 03: But the point is, when you look at them, when you go into the record, and I would like to start with Appendix 1100, ReoForce is mentioning it here today, talking about how they were informed in July of 1995, and this is Joe Gumm. [00:19:46] Speaker 03: That was a 2006 email. [00:19:48] Speaker 03: He's summarizing something that he communicated in July of 1995. [00:19:52] Speaker 03: You don't need to rely on that. [00:19:53] Speaker 03: Go to the actual letter that was sent to ReoForce, and that's at Appendix 992 to 993. [00:19:59] Speaker 03: That letter is the July 1995 letter. [00:20:02] Speaker 03: You don't need a 2006 email. [00:20:03] Speaker 02: But that letter, you're saying the July 1995 letter, not the memorandum of understanding. [00:20:10] Speaker 02: Correct. [00:20:10] Speaker 02: Why do you think he says here, though, that they need to conduct a validity exam before initiating operations? [00:20:17] Speaker 03: So there's some confusion here. [00:20:18] Speaker 03: And I want to be clear. [00:20:19] Speaker 03: In 1998, we talk about how the Fogan Group sort of took over Rio Force. [00:20:25] Speaker 03: And there is evidence. [00:20:26] Speaker 03: There was an inspection that was done by a geologist [00:20:29] Speaker 03: It was conducted, the Fogan Group submitted a new plan of operations that was different from the 97 and the 92 plan that allowed them to get 200,000 tons of pumiceite per year. [00:20:44] Speaker 03: When they saw, and this is at the appendix 10, 1012 to page 1024, the Fogan Group, what they did is they submitted a new plan of operations. [00:20:55] Speaker 03: A geologist shows up. [00:20:56] Speaker 03: goes out there, realizes this is land that's being withdrawn. [00:20:59] Speaker 03: It's already been withdrawn from the operation and mining laws. [00:21:01] Speaker 03: You cannot mine. [00:21:02] Speaker 03: You cannot have a new plan of operations that would be approved unless you get a validity determination. [00:21:08] Speaker 03: So it's true. [00:21:09] Speaker 03: The geologist writes that. [00:21:10] Speaker 03: Mining cannot continue until you get a plan of operations. [00:21:13] Speaker 03: That's accurate. [00:21:14] Speaker 03: That's under the new plan of operations. [00:21:17] Speaker 04: Is it your position and the Department of Interior's position that if Fogan, in 97, 98, decided [00:21:27] Speaker 04: Well, I'm just going to walk onto these lands that have an approved plan of operation dating back to the early 1990s and do precisely what Simonson had been authorized to do back then. [00:21:40] Speaker 04: I'm going to be free and clear and don't have to worry about any encumbrance from the 1995 MOU. [00:21:45] Speaker 04: Is that your position? [00:21:47] Speaker 03: Assuming that he complied with, assuming that the Fogan group at the time complied with all the regulations. [00:21:51] Speaker 03: So yes, if you had the right permits from the state of California, which your honor is absolutely correct, [00:21:56] Speaker 03: They didn't have. [00:21:57] Speaker 03: They didn't have in 95. [00:21:58] Speaker 03: They certainly didn't have them in 1998. [00:22:00] Speaker 03: It wasn't really until 2003 that they sort of got their act together. [00:22:03] Speaker 04: Is it your understanding you have to have the smart approval after 1995 before they could continue with their approved plan of operation? [00:22:13] Speaker 03: And that's reflected in the record. [00:22:14] Speaker 03: That's the November 95 letter. [00:22:16] Speaker 03: That's the letter sent from the Bureau to Mr. Simonson saying, you've got this approved plan of operations in existence. [00:22:22] Speaker 03: In order for you to mine, you need to get the right [00:22:26] Speaker 03: approval, this Samara approval, reclamation approval from the state of California, if you're going to mine under your approved plan of operations. [00:22:33] Speaker 04: But to just get back to Fogan, your view is that Fogan got tripped up because he applied for a new plan of operation and he had just adhered to the pre-existing plan of operation from the early 1990s. [00:22:48] Speaker 04: He wouldn't have had any problems. [00:22:49] Speaker 03: That's correct, Your Honor, assuming again that you'd comply with all the other requirements to mine. [00:22:54] Speaker 03: That was an approved plan of operations. [00:22:56] Speaker 03: And this is going to the settlement agreement. [00:22:58] Speaker 03: I mean, take a look at the settlement agreement. [00:23:00] Speaker 03: The trial court looked at the settlement agreement and called it a validity determination. [00:23:04] Speaker 03: It's no such thing. [00:23:05] Speaker 03: The settlement agreement at the contest proceeding between the parties, when you look at it, there is no mention. [00:23:12] Speaker 03: In fact, the trial court recognizes, says, is silent as to whether this was a validity determination. [00:23:16] Speaker 03: It was silent as to whether there were any property interests or that it had somehow recognized [00:23:22] Speaker 03: Simonson or Rio Force had a property interest, what the settlement agreement said was, you had an existing plan of operations. [00:23:29] Speaker 03: That existing plan of operations predated the withdrawal. [00:23:34] Speaker 03: Under that existing approved plan of operations, we are going to allow you to mine three of the mining claims that are at issue in this contest proceeding. [00:23:42] Speaker 03: And oh, by the way, here are these four conditions that we're going to set forth that you have to comply with in order to mine on these mining claims. [00:23:52] Speaker 04: tricky question here on whether or not Rio Force has a compensable property interest here, and you dispute that. [00:24:03] Speaker 04: Does the court need to first address and resolve whether there's a compensable property interest if [00:24:12] Speaker 04: hypothetically, the court were to conclude that even if there was one, there wasn't anything in the 1995 MOU that could be regarded as an interference of that compensable property interest? [00:24:24] Speaker 03: There's absolutely nothing preventing the court from saying, I mean, we can take our argument, no, there is no compensable property interest, therefore we're done. [00:24:32] Speaker 03: Or let's just go ahead and assume that there is a compensable property interest under Penn Central, under all the three factors, [00:24:39] Speaker 03: they cannot satisfy that there was a regulatory taking here. [00:24:42] Speaker 03: So yes, the court can do this. [00:24:44] Speaker 03: And the court has done this. [00:24:45] Speaker 03: I think recently the Chittenden case that came out last week, this court was an unpublished decision. [00:24:50] Speaker 03: But it basically says, we're just going to assume that there was a valid existing mining right or that there was a property interest. [00:24:57] Speaker 03: And it was still OK to dismiss the case. [00:24:59] Speaker 03: And I think that that's perfectly acceptable here. [00:25:02] Speaker 03: The court does not need to find first that there was. [00:25:06] Speaker 03: It can just assume that there was and then go and address [00:25:09] Speaker 03: dependent central factors. [00:25:10] Speaker 04: Why isn't Judge Futi's summary judgment opinion that there was a compensable property interest with respect to the three mining claims that you allowed to go forward under the settlement agreement, why isn't what he said there persuasive? [00:25:30] Speaker 03: Well, I think that he's misunderstood. [00:25:33] Speaker 04: I guess the whole point of the settlement was to grant Rio Force the [00:25:38] Speaker 04: recognition from the government that it was free and clear to go ahead and do mining. [00:25:44] Speaker 04: I mean, without saying the words valid claim, in effect, that's what it is. [00:25:49] Speaker 04: I mean, it would seem peculiar to have this settlement agreement and then, nevertheless, force Rio Force to then undertake a brand new proceeding to figure out [00:26:01] Speaker 04: whether what it has been granted is in fact a valid grant. [00:26:05] Speaker 03: Well, and if you look at the settlement agreement, one of the things that they give up is the ability to patent that mining claim. [00:26:10] Speaker 04: Well, I thought all patents were under moratorium already. [00:26:15] Speaker 03: That might be correct. [00:26:16] Speaker 03: I don't know what was going on at the time. [00:26:17] Speaker 03: I'd have to go back and look at that. [00:26:19] Speaker 03: But under the terms of the settlement agreement, all I'm pointing out though is if in fact the settlement agreement is read to be a valid determination and to say that you have a compensable property interest, [00:26:30] Speaker 03: We, the government, cannot put those conditions on those mining claims. [00:26:33] Speaker 03: So we can't come in and say, oh, you have a valid compensable property interest. [00:26:38] Speaker 03: And oh, by the way, if you don't mine in two years, we're taking that from you. [00:26:42] Speaker 03: Had that really been a recognition of a compensable property interest, we couldn't have put that condition on their mining operations. [00:26:50] Speaker 02: I hear what you're saying. [00:26:51] Speaker 02: But also, the agreement says that all disputes between the parties have been resolved. [00:26:56] Speaker 02: And the whole dispute between the party was validity, right? [00:26:59] Speaker 03: That's correct, Your Honor, and it's also correct, and you can look at Vest, you can look at Cameron, the Department of the Interior has an ongoing responsibility. [00:27:07] Speaker 03: This land is still fee-simple land that the government owns. [00:27:12] Speaker 03: Validity is, you can have a valid claim at one point, and it's not the case here, but you could have a case where the government goes through the process, there's a valid determination that's made, the mining claim continues to mine on that, and years later they file for a patent. [00:27:27] Speaker 03: It may very well be that the market has changed, conditions, who knows, and that it's now at the time of the patent an invalid claim. [00:27:34] Speaker 03: The government can go through that process and up until the point of patent, and if conditions have changed, it's not a one-time thing that says, okay, you've got a valid determination as of this date, therefore, for the foreseeable future, you will always have a valid claim. [00:27:50] Speaker 03: That's not accurate. [00:27:52] Speaker 03: In the validity determination, what we did in that contest proceeding, the settlement agreement says, [00:27:56] Speaker 03: The government is no longer going to contest the validity of these mining claims. [00:28:01] Speaker 03: That's what the settlement agreement says. [00:28:02] Speaker 03: We are dismissing, we're resolving this particular contest proceeding. [00:28:07] Speaker 02: There's nothing in the settlement agreement that says, we recognize that you have valid... Do I remember correctly, though, that if there isn't a valid claim, the land goes to California? [00:28:17] Speaker 03: Well, yes, Your Honor. [00:28:18] Speaker 03: That's true. [00:28:20] Speaker 03: And you can look at the regulations, and we cite this in our brief, and we explain that as of [00:28:26] Speaker 03: the withdrawal in 1995. [00:28:28] Speaker 03: And we cite our handbook. [00:28:30] Speaker 03: We cite the regulations that allowed, if you had an existing approved plan of operations that predates that withdrawal, you can mine under that plan of operations. [00:28:39] Speaker 03: And that's exactly what the government did here. [00:28:41] Speaker 03: The government looked at this and they said, okay, you've got this contest proceeding. [00:28:44] Speaker 03: You've agreed to dismiss the contest as to 23 of the, or excuse me, 20 of the claims. [00:28:50] Speaker 03: We're going to allow three of them to go forward. [00:28:52] Speaker 03: Oh, by the way, [00:28:53] Speaker 03: One of those claims didn't even have an exposed pumiceite. [00:28:57] Speaker 03: So under the mining law, that's not valid per se. [00:29:00] Speaker 03: If it's not even exposed pumiceite, so it's not like we're recognizing a validity determination. [00:29:05] Speaker 03: All we're saying is, go ahead and mine on those three claims under these conditions. [00:29:10] Speaker 01: You have two years. [00:29:12] Speaker 01: I still don't hear the government arguing that that settlement agreement extinguished all of the claims and all of the conditions and all of the debate. [00:29:22] Speaker 01: until the settlement. [00:29:24] Speaker 01: And although it's mentioned, it's almost as a throwaway. [00:29:27] Speaker 01: Your opponent says it related only to standing. [00:29:30] Speaker 01: Well, I think there was more to it. [00:29:32] Speaker 01: But there was the 24-month condition, which I gather was not met. [00:29:37] Speaker 01: But I don't hear you argue that this is what the issue seems to be. [00:29:42] Speaker 01: The settlement really actually was a settlement of all of this back and forth, was it not? [00:29:50] Speaker 03: It was certainly a settlement of the contest proceeding. [00:29:53] Speaker 03: And I admit that the government gave up its right to continue to challenge the validity. [00:29:58] Speaker 03: But at the end of the day, what the trial court did, and Rio Force is correct on this, that we did not argue below, you did not mind in that 24-month period, therefore you have no claim. [00:30:09] Speaker 01: They're correct to point out that that was some... So the government is waiving that question? [00:30:15] Speaker 03: I'm not saying that we're waiving that question. [00:30:16] Speaker 01: I think that if you look at the terms of settlement agreement, what it says is- Well, it's mysterious to look at it and yet to see nothing but silence when it seems to be, could be taken as a direct resolution. [00:30:30] Speaker 03: There was post trial. [00:30:32] Speaker 03: I mean, they put this in on the reconsideration motion. [00:30:37] Speaker 03: Rio Force comes forward with an affidavit saying, oh, here's what we did to comply. [00:30:41] Speaker 03: It may well be that we contest some of the things that they're claiming in terms of what they were doing. [00:30:47] Speaker 01: Is it too late to contest it, is it not? [00:30:50] Speaker 03: Well, I think what the settlement agreement contemplates is that you would then have to enforce the terms, that we would bring it back to, and I have to go back and look at this, but that we would then have to bring some sort of action to oust them of their right, of what we think if we're going to dispute what was going on. [00:31:05] Speaker 03: But this was a regulatory takings claim brought [00:31:09] Speaker 03: in the court of federal claims. [00:31:11] Speaker 03: So I'm not sure that it was, had we not addressed it then, that we somehow lost the ability to address that later. [00:31:17] Speaker 03: I think if real force prevails here and the settlement is still in place, they still have to abide by those requirements if they're going to mine on those claims. [00:31:26] Speaker 03: And we would still have the right to come in and say, you weren't mining over a 12-month period or any of the requirements. [00:31:32] Speaker 03: Or it's limited to, I think, a 10-year period and then another 10-year period, whatever. [00:31:36] Speaker 03: If they don't abide by that, then yes, we would come in [00:31:40] Speaker 03: And they would lose their ability to mine. [00:31:42] Speaker 04: Can I ask you a hypothetical? [00:31:44] Speaker 04: It may or may not relate to this case. [00:31:46] Speaker 04: But I just want to understand your understanding of Takings Law. [00:31:51] Speaker 04: If someone has an approved plan of operations to do some mining, and then the government says, stop. [00:31:56] Speaker 04: You can't do any more mining until there's a validity determination. [00:32:02] Speaker 04: And then the government doesn't do a validity determination for 20 years. [00:32:07] Speaker 04: And then it ultimately concludes. [00:32:09] Speaker 04: Yes, it's a valid claim. [00:32:12] Speaker 04: Would you agree that there was a regulatory taking for those 20 years, assuming economic injury and investment-backed expectations and all of that? [00:32:22] Speaker 03: Potentially, Your Honor, but I'd like to flag one thing, and that is, from the point at which they understand they're affecting their rights, they need to bring suit. [00:32:32] Speaker 03: If the government comes forward and says, stop mining, [00:32:36] Speaker 03: Within six years for the statute of limitations, they need to bring that takings claim. [00:32:40] Speaker 03: And if they wait 20 years for something that's supposed to happen, then they've lost the ability to bring that claim. [00:32:48] Speaker 03: And that's reflected in the Navajo Nation case that we cited. [00:32:52] Speaker 03: Temporary taking is treated exactly like a permanent taking. [00:32:55] Speaker 03: You're on notice. [00:32:56] Speaker 03: And here, these claimants, Mr. Simonson and Mr. Stain, his shareholder, as of 1995, when they alleged this supposedly happened, [00:33:05] Speaker 03: Two years later, they transferred all of their interests to their company, RealForce. [00:33:09] Speaker 03: In 1997, they were on notice. [00:33:11] Speaker 03: They didn't have rights anymore. [00:33:13] Speaker 03: It was all in RealForce. [00:33:14] Speaker 03: They should have brought their takings claim six years after 1997. [00:33:18] Speaker 03: They didn't do that here. [00:33:20] Speaker 01: And as we talk about it later on in the investment-backed... But you're not saying the statute started to run because they restructured their corporate structure. [00:33:28] Speaker 03: No, what I'm saying, Your Honor, is the statute started to run when they knew the individuals, the individuals knew exactly how their property rights had been affected because they transferred it to Rio Force in 1997. [00:33:38] Speaker 03: They knew, they alleged. [00:33:40] Speaker 03: You can look at their complaint, they alleged. [00:33:42] Speaker 03: The memorandum under their understanding and their reading of this, it prohibited them from mining. [00:33:47] Speaker 03: They no longer had an interest. [00:33:48] Speaker 03: If they're going to bring some sort of takings claim, they needed to bring it at that time because they understood that their rights had been prohibited from mining [00:33:57] Speaker 03: They need to bring within that six-year statute of limitations. [00:34:00] Speaker 03: And I get that from the Navajo Nation case that we cite. [00:34:04] Speaker 03: When your rights are affected, you have a duty to bring your claim. [00:34:07] Speaker 03: They didn't do that here. [00:34:09] Speaker 03: Rio Forest, to the extent that it does have a claim, Rio Forest took its interest in this property with the full knowledge under their reading of the memorandum that a taking had already occurred. [00:34:20] Speaker 03: There's no way that Rio Forest can establish any investment or reasonable investment back expectations. [00:34:26] Speaker 03: And there's no way that it can establish economic interest. [00:34:28] Speaker 03: And I'll point the court's attention to the mining expert, Mr. Springer, appendix 244 to 259. [00:34:34] Speaker 03: He talks about all the work that real force had not done in order to establish that. [00:34:39] Speaker 03: I see my time has expired. [00:34:41] Speaker 03: I ask that the court affirm. [00:34:45] Speaker 03: Do you have more questions? [00:34:46] Speaker 03: OK. [00:34:46] Speaker 01: Thank you. [00:34:46] Speaker 01: Thank you, Mr. Beeler. [00:34:48] Speaker 01: Mr. Stevens. [00:34:56] Speaker 00: Thank you, Your Honor. [00:34:57] Speaker 00: I'd like to deal with Judge Newman's questions first about the 24-month period and the significance of that. [00:35:05] Speaker 00: So our takings claim is that it was a temporary taking from 1995 to 2008. [00:35:11] Speaker 00: And if Rio Force had not started mining by 2010, then it would, at that point, have no property interest. [00:35:20] Speaker 00: But that was irrelevant to our claim. [00:35:23] Speaker 00: Our claim is in the 95 to 2008 period, [00:35:26] Speaker 00: was a temporary taking, and that is the only time period. [00:35:29] Speaker 01: And that's where you encounter the statute of limitations issue then. [00:35:33] Speaker 00: Well, so Your Honor, we rely on what Judge Futeh ruled, which was that in 1995, the claim was not right. [00:35:44] Speaker 00: Yes, the taking started, but the taking claim could not have been brought. [00:35:48] Speaker 00: And Judge Futeh relied on the Supreme Court decision in First English Evangelical Lutheran Church [00:35:54] Speaker 00: which makes that clear. [00:35:55] Speaker 00: The interference which can cause the taking can start earlier, and compensation has to be paid from that earlier point in time. [00:36:04] Speaker 00: But the claim itself in going into court may not be ripe until later. [00:36:08] Speaker 00: And it was not ripe in this case because it was unclear what Rio Force would have been able to do, what it could mine, whether it even owned the claims. [00:36:16] Speaker 00: And I think the policy of rightness is furthered in this case. [00:36:21] Speaker 00: because the claim was narrowed from 23 mining claims down to three. [00:36:26] Speaker 00: And so I think Judge Fute's decision was right. [00:36:29] Speaker 00: The claim was not right until later, even though the interference which started the taking started in 1995. [00:36:39] Speaker 00: And I think back to that 1995 question, I think it's important [00:36:44] Speaker 00: to remember that Rio Force got this memorandum of understanding and the letter was sent saying, this is the new plan. [00:36:54] Speaker 00: And Rio Force, I think it's only reasonable that it relied upon that plan, knew that it was not a producing mine, knew that there was, there's not separate kinds of plans of operations for exploration. [00:37:06] Speaker 00: And this is corroborated, even though it may be 10 years later or years later, [00:37:12] Speaker 00: There's never been anybody saying you can mine until after this case was brought. [00:37:18] Speaker 04: Likewise, there was nobody in the 1995 era that told Mr. Simonson you cannot mine. [00:37:25] Speaker 00: Just the MOU itself. [00:37:27] Speaker 00: The MOU itself and the letter to him tells him. [00:37:31] Speaker 00: And as I mentioned before, to simply ignore that is to run the risk of a mineral trespass. [00:37:42] Speaker 00: I think to come back later and say, well, you really could have mined, is doing a disservice to a citizen. [00:37:52] Speaker 00: And again, I want to say about the July 1995 letter. [00:37:55] Speaker 00: I mean, our contentions in the trial court is it was never received. [00:37:59] Speaker 00: As far as we know, it was never mailed. [00:38:01] Speaker 00: It was not signed. [00:38:03] Speaker 00: It's not even on BLM letterhead. [00:38:05] Speaker 00: As far as we know, it's a draft letter. [00:38:07] Speaker 00: But we had no knowledge of it. [00:38:09] Speaker 00: until Mr. Simonson actually did some FOIA requests and learned about it after the mineral report came out saying that the BLM's positions as claims were not valid. [00:38:23] Speaker 00: As to the idea that Rio Force took notice of the taking when it acquired it from its stockholders, I think that runs straight [00:38:39] Speaker 00: contrary to the Supreme Court's decision in Palo Zolo, that having notice of the regulation is not determinative of no reasonable investment-backed expectations. [00:38:51] Speaker 00: And even doubly so in the context of this case, because what they took notice of was that there was a suspension until a VER was done. [00:39:03] Speaker 00: This is not the case as in Palo Zolo or in other cases where people have notice [00:39:09] Speaker 00: that some permanent regulation, say a wetland regulation, is never going to let you develop the property. [00:39:15] Speaker 02: Do you want to talk about the pencentral factors? [00:39:17] Speaker 00: Well, I'll do so very, very quickly. [00:39:21] Speaker 00: Judge Braden indicated there's no economic impact because Rio Force was years from actually getting into production. [00:39:30] Speaker 00: And our position is whether the ramp up time was two years as we contended, or four, or eight, Rio Force still lost 13 years. [00:39:38] Speaker 00: It's all just been set back, and that still has an economic impact, considering it involved a half a million dollars investment and a decade of a man's life. [00:39:50] Speaker 00: As to reasonable investment backed expectations, I would say it is confirmed by the fact that multiple mining companies were wanting to either buy the deposit or go into a joint venture. [00:40:03] Speaker 00: With that, I see my time is up. [00:40:06] Speaker 01: Thank you. [00:40:07] Speaker 01: Thank you both. [00:40:08] Speaker 01: The case is taken under submission.