[00:00:00] Speaker 03:
Thanks, everyone, for their patience.

[00:00:02] Speaker 03:
The next case for argument is 20-2018, BP America Production Company versus United States.

[00:00:32] Speaker 03:
Okay, as I said to the other advocates, when you're at the podium, you're free if you wish to remove your mask, but only at the podium.

[00:00:42] Speaker 03:
Ms.

[00:00:42] Speaker 03:
Finman?

[00:00:57] Speaker 04:
May I please the court?

[00:00:58] Speaker 04:
On behalf of the United States, we ask that this court reverse the judgment of the Court of Federal Claims.

[00:01:04] Speaker 04:
The underlying cause of action here is a claim for statutory benefit.

[00:01:08] Speaker 04:
So this court is charged with statutory construction of the relevant statute to issue.

[00:01:14] Speaker 03:
Can I just interrupt you with a housekeeping thing?

[00:01:18] Speaker 03:
It's curious to me, since a lot of people played under this statutory provision, I assume, that has now been or was repealed in 2015,

[00:01:27] Speaker 03:
And statement of related cases, I don't think you cited any.

[00:01:31] Speaker 03:
So is this just a one-off, or are there 100 cases waiting in the pipeline based on this?

[00:01:38] Speaker 03:
Or is this because so much time has passed, and BP was a big player, and yadda-da?

[00:01:44] Speaker 03:
Is this really a one-off, or are there many, many cases waiting behind it?

[00:01:48] Speaker 04:
This is the only case in which I'm aware.

[00:01:50] Speaker 04:
I think, as Your Honor notes, there has been a significant passage of time

[00:01:54] Speaker 04:
whether there are any still winding their way through an administrative process that I can't make a representation to a court one way or the other.

[00:02:02] Speaker 04:
But this is the only case that's gotten to court in this fashion.

[00:02:07] Speaker 03:
OK, thank you.

[00:02:10] Speaker 04:
So this court's charged with statutory construction.

[00:02:13] Speaker 04:
Here, that primary statute issue is Favrema.

[00:02:17] Speaker 04:
As a fact as affected by the fast act which repealed section 1721 H effective December 2015 and also the general savings statute, which United States is raised in its brief There's no dispute amongst the parties or the trial court that prior to the fast act Fogger ma created a liability the United States to overpayment interest and then that overpayment interest

[00:02:43] Speaker 04:
was part and parcel of a larger statutory scheme that provided for the manner of its satisfaction.

[00:02:51] Speaker 03:
Let me just ask you, in the pre-FAST statutory scheme, am I correct that the government wasn't required to pay back overpayment interest until a party asked it to?

[00:03:07] Speaker 03:
Simply stated yes, okay, there wasn't any Acquirement to do it if on its own initiative if it didn't know about the overpayment or no one asked about it.

[00:03:16] Speaker 04:
No the Honor and our would assist in the in the calculation efforts.

[00:03:23] Speaker 04:
It is a complicated Calculation so there was an interplay back and forth between O and RR and lessee, but you're right but if no one asked for an overpayment the

[00:03:34] Speaker 01:
The lessee would be credited with that amount, right?

[00:03:38] Speaker 01:
The following year or something?

[00:03:42] Speaker 04:
Not, not suespante by, by ONRR, right?

[00:03:45] Speaker 04:
There was a monthly process whereby the lessee would submit, you know, its reports as to how much oil and gas it had extracted.

[00:03:55] Speaker 01:
So the lessee needs to know, you need to inform the lessee that there's been an overpayment.

[00:04:02] Speaker 04:
Yes, typically the lessee was statically entitled to calculate on their own.

[00:04:09] Speaker 04:
But if the lessee determined that it was too burdensome to do so, ONRR would do the calculation for them.

[00:04:15] Speaker 04:
And then there was a series of audits.

[00:04:17] Speaker 04:
And so there's an interchange of information.

[00:04:19] Speaker 01:
So in this case, wouldn't any type of deadline, administrative deadline, begin once the lessee is notified that they're entitled to a refund?

[00:04:31] Speaker 04:
The lessee would yes, and then the lessee would typically make a demand and then that would

[00:04:37] Speaker 04:
trigger a process, right?

[00:04:39] Speaker 04:
ONRR would either agree with the demand and offer to make a payment or a credit.

[00:04:47] Speaker 04:
If there was a dispute, it would trigger 30 days for an appeal.

[00:04:50] Speaker 04:
The administrative appeal process would run at the end of the appeal.

[00:04:54] Speaker 03:
So the date of the refusal, there has to be a request, as I'm hearing you.

[00:04:58] Speaker 03:
And the date of the refusal of such a request is the date that the claim for liability accrues under the statute.

[00:05:05] Speaker 03:
Is that correct?

[00:05:06] Speaker 04:
Now, under the statute, the claim accrues upon the fixing of liability.

[00:05:12] Speaker 04:
So that is at the overpayment date.

[00:05:16] Speaker 04:
But the statute provides its own internal seven-year statute of limitations.

[00:05:20] Speaker 04:
So there's plenty of time thereafter for the parties to work out

[00:05:26] Speaker 04:
how much money is owed, and then there was also a statutory system for tolling agreements of that administrative scheme that would then push the claim accrual date back further.

[00:05:36] Speaker 01:
So as long as the actual payment, the correct payment that is being dealt with is finalized, then the time does not begin to run until that time

[00:05:54] Speaker 04:
Under the administrative scheme, and BP takes issue with whether the administrative scheme is applied, but under the administrative scheme, that's seven years that the statute provides for in 1724H.

[00:06:07] Speaker 04:
began to run from the overpayment.

[00:06:11] Speaker 04:
When the overpayments were made, that's between 2004 and 2008.

[00:06:15] Speaker 04:
Now there was a subsequent audit.

[00:06:17] Speaker 04:
The parties entered a series of tolling agreements.

[00:06:20] Speaker 04:
So that seven years didn't simply run from each month in 2004 to 2008 to seven years later.

[00:06:27] Speaker 04:
There were starts and stops along the way.

[00:06:34] Speaker 04:
Regardless of exactly when this court would find that the claim accrued, at the latest, it accrued in June 2016, which was that final demand from ONRR that the overpayment interest that the agency had paid out be recouped.

[00:06:59] Speaker 04:
And it's indisputable, based on the record, that as of that June 2016 date,

[00:07:04] Speaker 04:
There was no timely administrative appeal.

[00:07:07] Speaker 04:
There was no process initiated within 30 days.

[00:07:11] Speaker 04:
There was no winding its way through that administrative process.

[00:07:15] Speaker 04:
There was no final agency action from that point, which is why, in our voice, we've argued that BP's claim fails for multiple reasons.

[00:07:28] Speaker 04:
But it did not exhaust its administrative remedies.

[00:07:32] Speaker 03:
Even if there wasn't, that's the heart of the question, right?

[00:07:35] Speaker 03:
I mean, the statute clearly worked out all those administrative remedies.

[00:07:39] Speaker 03:
And the only issue is whether or not the savings provision that you point to would have required them to go to the ONRR, notwithstanding that the ONRR said, you can't come to us because we're closed.

[00:07:52] Speaker 04:
The administrative appeals process, which applies more broadly than overpayment interest claims, has always existed, and continues to exist, and exists despite the Fast Act.

[00:08:04] Speaker 04:
All the Fast Act did was amend Fagerma by striking out 1721H.

[00:08:12] Speaker 04:
1721H contained the right to overpayment interest, the manner of satisfaction, payment for credit,

[00:08:22] Speaker 04:
the rate for interest, how their interest would be calculated, and the fact that the burden of that recouping of interest would be shared with the states.

[00:08:31] Speaker 04:
That's all the FAST Act did.

[00:08:33] Speaker 02:
You don't think that it removes the source of funding, the appropriations to the agency to pay that amount?

[00:08:40] Speaker 04:
No, because in this context, and the Supreme Court's Dalarama case talks about this, the right to interest

[00:08:50] Speaker 04:
appears in 1721H, part and parcel with the manner of its satisfaction payment or credit, which also appears in 1721H.

[00:09:02] Speaker 04:
So the FAST Act in repealing 1721H either repealed

[00:09:07] Speaker 04:
it all or kept it alive.

[00:09:11] Speaker 04:
The provisions stand or fall together.

[00:09:13] Speaker 04:
They're within the same section.

[00:09:16] Speaker 04:
There's no principal basis.

[00:09:18] Speaker 03:
I don't understand what provisions.

[00:09:20] Speaker 03:
It's me, but what provisions you're saying provisions in plural.

[00:09:25] Speaker 03:
What two provisions are you saying stand or fall together?

[00:09:31] Speaker 04:
The provisions of the statute, 1721H.

[00:09:35] Speaker 04:
It's just that 1721H contains multiple statements, right?

[00:09:41] Speaker 03:
So you're saying, can I just ask you, as an aside, a follow up to Judge Still's question.

[00:09:46] Speaker 03:
Under the former statute, which was repealed, you go to district court.

[00:09:50] Speaker 03:
How do you go to district court for the monetary relief here?

[00:09:54] Speaker 03:
I mean, isn't it court of claims?

[00:09:55] Speaker 03:
What could the district court do in the circumstance?

[00:09:59] Speaker 04:
The district court would review a final agency action.

[00:10:03] Speaker 04:
If that agency action was erroneous, if the district court were to find it was erroneous, it can declare it unlawful.

[00:10:11] Speaker 04:
It can send the parties back.

[00:10:12] Speaker 01:
But it can't award damages, right?

[00:10:17] Speaker 04:
Probably not.

[00:10:18] Speaker 04:
But this court doesn't need to get there, because it's untimely either way.

[00:10:25] Speaker 04:
It's untimely.

[00:10:28] Speaker 04:
If the administrative process applied, the seven years has long since expired and expired long before.

[00:10:35] Speaker 02:
Just to make sure I understand, you're saying it doesn't matter whether they could have received any money through the district court process because they didn't even try?

[00:10:46] Speaker 02:
Is that what you're saying?

[00:10:48] Speaker 04:
No.

[00:10:49] Speaker 04:
Well, right.

[00:10:50] Speaker 04:
They can't receive anything from the district court because they never exhausted their administrative remedies.

[00:10:54] Speaker 04:
But I think the question was, from Judge Raina, was if, if I understand this correctly, if there is residual Tucker Act jurisdiction, the option is going to district court or the court of federal claims, could the parties have gotten money from the district court?

[00:11:15] Speaker 04:
And my point is that this court doesn't need to resolve that issue.

[00:11:20] Speaker 04:
because if it finds that the administrative exhaustion requirements continue to apply, 1724H, which was unaffected by the repeal, they have never exhausted, they don't belong in district court.

[00:11:34] Speaker 01:
Let's talk a little bit about the administrative remedies and talk about the exhaustion.

[00:11:42] Speaker 01:
It seems to me that there's a viable argument that seeking to

[00:11:50] Speaker 01:
resolve this through the administrative processes would have been an act of futility, would have been futile.

[00:11:57] Speaker 01:
Can you respond to that?

[00:11:59] Speaker 04:
Yes, Your Honor.

[00:12:00] Speaker 04:
So we have submitted that it would be pure speculation that it would be futile.

[00:12:06] Speaker 04:
Administrative processes exist for a reason, right?

[00:12:09] Speaker 04:
They give higher level decision makers at the agency the chance to reconsider an initial decision.

[00:12:17] Speaker 04:
It would have given the parties a chance to crystallize, you know, what was owed, when it was owed.

[00:12:23] Speaker 01:
The government's position is that the agency had no authority anymore.

[00:12:30] Speaker 01:
That there was no, there was no funds, and plus there was no authority to award or to reimburse the funds.

[00:12:41] Speaker 01:
So why would not, and you're arguing that, no, that the process would not have been futile.

[00:12:48] Speaker 04:
The process would not have been futile, because there was a chance that the higher level decision makers at the Department of Interior would determine that that initial decision was wrong.

[00:12:58] Speaker 04:
There was 1721 pursuant to the general status.

[00:13:02] Speaker 01:
But they couldn't have done anything about it.

[00:13:05] Speaker 04:
Yes, they could have, because if the right to interest survives for pre-repeal liabilities,

[00:13:15] Speaker 04:
So does the matter to pay for it, because they are part and parcel of a single comprehensive administrative fee.

[00:13:22] Speaker 02:
What is your support for that allegation, given that 1721H was removed in its entirety?

[00:13:35] Speaker 04:
This is not a takings case.

[00:13:38] Speaker 04:
It's a statutory benefit case.

[00:13:41] Speaker 04:
So if the right exists, right?

[00:13:43] Speaker 04:
And I think we can all say that under the right conditions, the right exists.

[00:13:50] Speaker 04:
It exists because 1721-H, the pre-repeal version, survives the fast act for purposes of that liability.

[00:14:01] Speaker 04:
That's the only place the right can come from.

[00:14:04] Speaker 04:
It has to come from FADRA.

[00:14:05] Speaker 04:
If 1721-H survives, so does the rest of the clauses in 1721-H.

[00:14:12] Speaker 02:
I understand your logic.

[00:14:13] Speaker 02:
But do you have cases or statutory support for that?

[00:14:17] Speaker 04:
Yes.

[00:14:18] Speaker 04:
So the De La Rama case, which is a Supreme Court case at pages 389 to 90, talks about how the general savings statute kicks in in these circumstances to provide a rule of statutory construction.

[00:14:33] Speaker 04:
When, as here, a statute, and this is the Supreme Court quote, creates rights and also prescribes how the rights are vindicated, the substantive and procedural provisions are not discrete categories.

[00:14:45] Speaker 04:
They are fused components of an expression of policy.

[00:14:49] Speaker 04:
Here, in 1721-H, pre-repeal, there is both the right to interest, the manner it's calculated, and how it is satisfied.

[00:14:58] Speaker 04:
It's satisfied from current receipts in ONRR's program, either by payment or credit against another lessee's underpayment.

[00:15:09] Speaker 04:
So there's no appropriations issue in that context.

[00:15:14] Speaker 04:
The Daler-Rommer case talks at length about how you can't

[00:15:18] Speaker 04:
divorce a liability provision from its larger statutory scheme.

[00:15:23] Speaker 04:
If the liability provision survives, so does the scheme in which Congress created it.

[00:15:30] Speaker 03:
Are you sure about that?

[00:15:31] Speaker 03:
You're suggesting they can just, because it's money that they can just move around the funds.

[00:15:36] Speaker 03:
I mean, I was a bureaucrat for a long time, and there's something called the Agency Deficiency Act, which we think about every day.

[00:15:42] Speaker 03:
It seems to me there could be, if that were the case, and you didn't need appropriations, you don't have appropriations, you can start funneling the money back and forth.

[00:15:51] Speaker 03:
That doesn't seem to me like the right course that one would follow in the normal scheme of things.

[00:15:57] Speaker 04:
So all the Administrative Deficiency Act

[00:16:00] Speaker 04:
says is that agencies are forbidden from spending money, you know, in excess of an appropriation for unlawful purpose.

[00:16:10] Speaker 04:
That is not what Interior would be doing here, right?

[00:16:12] Speaker 04:
If 1721H survives for interest liability, so does its authority to pay.

[00:16:21] Speaker 03:
It's using it the... So you're saying

[00:16:24] Speaker 03:
that Interior is to date, as far as I know, getting billions of dollars in current receipts.

[00:16:32] Speaker 03:
So you're saying that ONRR can be using current receipts to pay off these final things, really?

[00:16:42] Speaker 04:
Yes.

[00:16:43] Speaker 04:
That's what 1721-H says.

[00:16:45] Speaker 04:
It says there is a right to overpayment interest, and that right shall be vindicated or satisfied by payment

[00:16:55] Speaker 04:
from current receipts or a credit against the lessee's underpayment of royalties in some other month.

[00:17:04] Speaker 04:
And that pot of money that was current receipts are always going to be divorced in time from the original accrual of the interest rate, right?

[00:17:14] Speaker 04:
Because we have this long seven-year process.

[00:17:18] Speaker 04:
There's an interim audit.

[00:17:19] Speaker 04:
There's an interchange of ideas.

[00:17:21] Speaker 01:
That's the case in waiting to pay them.

[00:17:23] Speaker 01:
Why don't you pay them now?

[00:17:25] Speaker 04:
They never appealed.

[00:17:26] Speaker 04:
They slept on their rights.

[00:17:29] Speaker 04:
He slept on his rights.

[00:17:30] Speaker 03:
Well, they didn't exactly sleep on their rights.

[00:17:32] Speaker 03:
They went to ONRR, and ONRR told them, no, you can't come here.

[00:17:37] Speaker 03:
We're out of business.

[00:17:38] Speaker 03:
So you're saying they should have appealed to the government.

[00:17:42] Speaker 03:
Once the government tells them, we're out of business because Congress repealed the statute, they should have appealed to the next level of government, as opposed to taking them at their word, looking at the situation, saying, yes, that makes sense, and going to the Court of Federal Claims, where there's no dispute that the money is owed them.

[00:18:02] Speaker 03:
There's never been any dispute that the money is owed them.

[00:18:09] Speaker 04:
It's owed them within the context of the statute.

[00:18:12] Speaker 04:
They slept on their rights.

[00:18:14] Speaker 04:
Lots of people get injured.

[00:18:15] Speaker 03:
Well, it's never outside of the context of the statute.

[00:18:17] Speaker 03:
They went to the Court of Federal Claims, and they're using the Judgment Fund, which is the way it works for 99% of the cases we see.

[00:18:24] Speaker 03:
So I'm not suggesting that the government doesn't have to be a great steward of making sure that people use the right boxes and the right avenues of relief.

[00:18:38] Speaker 03:
This one just seems a little off.

[00:18:42] Speaker 04:
To respond, Your Honor, I'm conscious of my time.

[00:18:44] Speaker 04:
And to respond to Your Honor's concern here, if the court were to find that the administrative regime did not apply, the right to interest survive, but not the administrative scheme for its remedy, such that there was Tucker Act jurisdiction, BP's claim is untimely.

[00:19:02] Speaker 04:
If the administrative scheme does not apply, you have to go back to

[00:19:07] Speaker 04:
Original principles of claim accrual.

[00:19:09] Speaker 04:
That's 2004 to 2008.

[00:19:11] Speaker 04:
They waited until 2018 to file on the Court of Federal Claims.

[00:19:15] Speaker 03:
They cannot avail themselves.

[00:19:19] Speaker 03:
The statute was repealed in 2015.

[00:19:21] Speaker 03:
They're going to the Court of Federal Claims because the statute has been repealed, and this is the way they seek relief of their claim, right?

[00:19:29] Speaker 04:
That would be some form of a takings claim.

[00:19:32] Speaker 04:
That is not this case.

[00:19:33] Speaker 04:
This case is a claim for a statutory benefit.

[00:19:35] Speaker 01:
Are you saying that if we were to find against you with respect to the limitations that the government would pay?

[00:19:46] Speaker 04:
No, they are.

[00:19:48] Speaker 04:
Well, we would have rights to appeal.

[00:19:50] Speaker 04:
I don't know what the government will do.

[00:19:51] Speaker 04:
We haven't gotten the court's decision.

[00:19:52] Speaker 04:
We would comply with the court's decision.

[00:19:55] Speaker 04:
I can say that.

[00:19:56] Speaker 04:
But the BP cannot take advantage of the parts of the administrative scheme that help it and not the parts that hurt.

[00:20:04] Speaker 04:
So if the Tucker Act applies and the administrative scheme does not, the claims accrue in 2014 and 2018.

[00:20:10] Speaker 01:
Isn't that for you?

[00:20:10] Speaker 01:
I mean, you're asking them to go to an agency that has already denied them.

[00:20:15] Speaker 04:
They did not go to the agency, ask, and get denied.

[00:20:18] Speaker 04:
They received a dear payor letter, and then a letter that money was due back to the agency.

[00:20:26] Speaker 04:
And they paid the money they were told.

[00:20:27] Speaker 01:
What were they told?

[00:20:28] Speaker 01:
We can't pay you because we no longer have money, and we no longer have authority.

[00:20:35] Speaker 04:
Right.

[00:20:35] Speaker 04:
And if they believed that they had an interest right, regardless of that communication,

[00:20:45] Speaker 04:
then they had an obligation to timely file suit, and they didn't.

[00:20:51] Speaker 04:
Or to timely appeal, which they didn't.

[00:20:53] Speaker 04:
Administratively appeal, which they didn't.

[00:20:56] Speaker 04:
This is not a mom-and-pop shot.

[00:20:58] Speaker 04:
This is a sophisticated organization.

[00:21:00] Speaker 04:
Its affiliate, the BP Exploration case, which is also down before the Court of Federal Claims, BP Exploration was in an administrative appeal process after the FAST Act.

[00:21:12] Speaker 03:
Well, at most, they may have made a mistake.

[00:21:15] Speaker 03:
It's not because there's no other advantage to them to going this way as opposed to the other way.

[00:21:20] Speaker 03:
We all agree they were owed the money.

[00:21:22] Speaker 03:
So they weren't playing fast and loose.

[00:21:25] Speaker 03:
Maybe they made a mistake.

[00:21:27] Speaker 03:
But at most, it was that.

[00:21:29] Speaker 04:
Yes, maybe so.

[00:21:30] Speaker 04:
But the Supreme Court, as well established as a party's ignorance of their rights or their miscalculation of their rights, does not forgive a limitation.

[00:21:40] Speaker 03:
Okay, we're way beyond time, so we'll reserve a couple minutes for you.

[00:21:43] Speaker 03:
Let's hear from the others.

[00:21:45] Speaker 03:
Thank you.

[00:22:00] Speaker 00:
Good morning, Your Honors.

[00:22:01] Speaker 00:
James Auslander for BP.

[00:22:03] Speaker 00:
May it please the Court, we submit that this is a straightforward case.

[00:22:07] Speaker 00:
I think the line of questioning is asking the question, what was BP supposed to do that it didn't do in this case?

[00:22:16] Speaker 00:
It's undisputed, as Your Honor stated, that the United States owes BP money for its interest on overpayment of royalties.

[00:22:25] Speaker 00:
There's no dispute that the royalty overpayments occurred.

[00:22:28] Speaker 00:
There's no dispute the overpayment interest accrued.

[00:22:31] Speaker 00:
And there's no dispute that the debt remains up to date.

[00:22:33] Speaker 03:
So what is the date where your argument is that your liability accrued?

[00:22:39] Speaker 00:
BP's claim accrued, as the district court said, in December 2015 when the FAST Act removed the agency's authority and source of funds to pay the money to BP.

[00:22:50] Speaker 00:
And that's rendered the judgment fund the only available avenue to do so.

[00:22:54] Speaker 03:
Why wouldn't they have accrued at least when ONRR told you couldn't get the money that he wrote?

[00:23:01] Speaker 03:
Oh, that was afterwards.

[00:23:02] Speaker 03:
That was after.

[00:23:03] Speaker 03:
I'm sorry.

[00:23:04] Speaker 03:
Withdrawal.

[00:23:05] Speaker 00:
Sure.

[00:23:05] Speaker 00:
Sure, Your Honor.

[00:23:08] Speaker 00:
The United States knows precisely how much money is owed here.

[00:23:11] Speaker 00:
Again, it's $1 million, about $1.3 million.

[00:23:14] Speaker 00:
The United States doesn't want to pay BP.

[00:23:17] Speaker 00:
And that's understandable.

[00:23:19] Speaker 00:
But to be clear, this claim arises only from the Fast Act.

[00:23:23] Speaker 00:
It arises from an act of Congress, not from any administrative action.

[00:23:27] Speaker 03:
But you heard the other side, and you've read their brief.

[00:23:30] Speaker 03:
They say there's some sort of

[00:23:32] Speaker 03:
continuing appropriation that would allow those funds to be used, that they're still open for business and processing.

[00:23:39] Speaker 03:
Why wouldn't it have been the most reasonable for you to pursue that avenue if it finally ended up at the end of the day and, you know, at the steps of the former act that they said, we're out of business and we can't pay you, could have gone to the court of federal claims then.

[00:23:55] Speaker 03:
Why didn't you at least try to exhaust

[00:23:58] Speaker 03:
the existing thing, which would have avoided our being here in this food fight today.

[00:24:01] Speaker 00:
Sure.

[00:24:02] Speaker 00:
Several reasons, Your Honor.

[00:24:04] Speaker 00:
We would have not been here today at all if but for the FAST Act.

[00:24:07] Speaker 00:
BP submitted its demand.

[00:24:09] Speaker 00:
It submitted its resubmission of the overpayment interest and overpayment principle.

[00:24:15] Speaker 00:
It got back its overpayment principle.

[00:24:17] Speaker 00:
It's undisputed that that submission for the overpayment principle also constituted the claim for the overpayment interest.

[00:24:23] Speaker 00:
And BP actually got some of that overpayment interest back.

[00:24:26] Speaker 00:
after the FAST Act, the agency gave it back erroneously.

[00:24:30] Speaker 00:
And then in June 2016 said, actually we didn't have any authority or money to give it to you, we actually need it back.

[00:24:37] Speaker 00:
BP looked at the unambiguous FAST Act, found that the honor was correct, and paid back the money.

[00:24:44] Speaker 00:
and brought this case here.

[00:24:47] Speaker 00:
There is no case.

[00:24:50] Speaker 00:
General savings.

[00:24:51] Speaker 03:
If you had not paid back the money, how do you think things would have turned out?

[00:24:55] Speaker 03:
What would have been the government's recourse in that circumstance?

[00:24:57] Speaker 00:
There would have been an enforcement action, Your Honor, and BP may have been liable for civil penalties for failure to comply with an order.

[00:25:04] Speaker 00:
That's 1719.

[00:25:05] Speaker 03:
So your options then were, OK, so you didn't feel like you had the option whether or not to pay the money back.

[00:25:10] Speaker 03:
But why didn't you take it up the chain

[00:25:12] Speaker 03:
of the now repealed statutory proceedings to try to get you relief.

[00:25:19] Speaker 00:
Sure, and there's agreement on all parties, Your Honor.

[00:25:22] Speaker 00:
Now, again, I want to be clear that BP's claim is not premised on anything the agency did.

[00:25:26] Speaker 00:
Anything that happened administratively after the FAST Act is not material to the claim.

[00:25:31] Speaker 00:
However, it's very telling that everything that Honor did and said, including to BP as well as to the entire industry, announced the same interpretation.

[00:25:40] Speaker 00:
The first time the government posited that it may have authority or we should try to persuade it was in 2019, five years later, on summary judgment.

[00:25:49] Speaker 00:
It wasn't even in the motion to dismiss.

[00:25:51] Speaker 00:
It was in summary judgment that the first time that they ever announced this position.

[00:25:54] Speaker 00:
So it's introducing ambiguity when none exists.

[00:25:59] Speaker 00:
I believe that the statute is very clear.

[00:26:01] Speaker 00:
It takes away the checkbook, but it doesn't take away the liability.

[00:26:05] Speaker 00:
And that's what the Judgment Fund is for.

[00:26:06] Speaker 00:
And I believe the District Court probably said it best, better than I could say.

[00:26:10] Speaker 03:
Because the liability all accrued long before the statute was repealed.

[00:26:14] Speaker 00:
Yes, Your Honor.

[00:26:15] Speaker 00:
There's no dispute at all that the liability remained.

[00:26:18] Speaker 00:
That was an issue on motion to dismiss.

[00:26:21] Speaker 00:
The government reserved its position on that.

[00:26:24] Speaker 00:
Then on summary judgment, the government came forward and said, yes, it is not retroactive.

[00:26:29] Speaker 00:
Yes, the liability is preserved.

[00:26:30] Speaker 00:
However, under this new theory of the general savings statute, we can pay you, and you should have come to us a year ago, or five years ago.

[00:26:40] Speaker 00:
I also just want to point out, because I think Judge Raina, your question was about the end game here.

[00:26:46] Speaker 00:
And the end game is with the, again, this is not argued in the appellate briefs, but it was argued clearly to the district court.

[00:26:51] Speaker 00:
The government believes that under the Fagrama administrative scheme, that after you have finished your administrative appeals, and that could take four or five years, the Interior Board of Land Appeals is taking about two, three years to issue decisions right now.

[00:27:05] Speaker 00:
At the end of that process, you go to federal district court because Fagra must says the Administrative Procedure Act is the standard of review.

[00:27:13] Speaker 00:
And so they view that as requiring you to go to district court.

[00:27:17] Speaker 00:
Well, the federal circuit, the 10th Circuit Court of Appeals have said, I'm sorry, the DC Circuit and the 10th Circuit Court of Appeals have said, you can't come here for the money.

[00:27:26] Speaker 00:
You have to go to the federal court of claims.

[00:27:29] Speaker 00:
So at the end of this diversion, that the government wants us to do this energy administrative appeal, we end up in a court where we can't do anything.

[00:27:37] Speaker 00:
And their brief says, well, you know, they would have done what they did, and administratively, we'd be in the same place.

[00:27:42] Speaker 03:
That was the statutory scheme.

[00:27:44] Speaker 03:
So before they repealed the statute, how did that statutory scheme make any sense?

[00:27:49] Speaker 03:
if it didn't provide a venue for relief, a form for relief at the end of the day?

[00:27:54] Speaker 00:
Well, Your Honor, that's because these claims didn't exist before the Fast Act.

[00:27:57] Speaker 00:
Again, BP is not arguing that before the Fast Act it had a right to come to this court.

[00:28:02] Speaker 00:
And that's why any suggestion that we should have come here in 2012 kind of makes no sense.

[00:28:07] Speaker 00:
BP submitted its overpayment interest principal demand.

[00:28:11] Speaker 00:
It got the right to also get the overpayment interest if it had a dispute with the agency about how much principal was owed.

[00:28:19] Speaker 00:
They had a dispute about whether the tolling was in place.

[00:28:24] Speaker 00:
If it had a question about coalescees or who paid what and when, those would be issues for the agency.

[00:28:30] Speaker 00:
We'd have to appeal that through the administrative process and then ultimately there would be a decision and the agency would have to comply with that decision.

[00:28:38] Speaker 00:
So that is how it works.

[00:28:41] Speaker 00:
That is how it proceeds.

[00:28:42] Speaker 00:
And we don't dispute that even today.

[00:28:44] Speaker 00:
That's how it should proceed.

[00:28:46] Speaker 00:
In a BP exploration case, that's exactly what happened.

[00:28:49] Speaker 00:
There was a dispute about the principle.

[00:28:51] Speaker 00:
There was a dispute about the tolling, whether it was bilateral or unilateral, about how long it lasted.

[00:28:57] Speaker 00:
And part and parcel,

[00:28:58] Speaker 00:
buried in there was this overpayment interest claim.

[00:29:01] Speaker 00:
And so they did go to administrative appeal because they had to.

[00:29:04] Speaker 00:
And if that was our situation, we would have done the same thing.

[00:29:08] Speaker 00:
But this is a clear removal of the authority and money.

[00:29:11] Speaker 00:
There's no case that says that after Congress strikes, the authority and funds that the agency somehow has the ability to keep paying or crediting have an interest.

[00:29:21] Speaker 00:
Completely agree with the panels that views on that.

[00:29:26] Speaker 00:
And that would be making new law here.

[00:29:31] Speaker 03:
Anything further?

[00:29:32] Speaker 00:
I have nothing further, Your Honor.

[00:29:33] Speaker 00:
Thank you.

[00:29:34] Speaker 00:
Thank you.

[00:29:46] Speaker 03:
We exhausted your time, but we'll give you two minutes of rebuttal.

[00:29:49] Speaker 04:
Thank you, Your Honor.

[00:29:51] Speaker 04:
Just very, very briefly, BP is confusing their cause of action here.

[00:29:57] Speaker 04:
The trial court, this court, needs to be aware.

[00:30:01] Speaker 04:
BP sued under two legal theories, breach of contract and statutory benefit.

[00:30:06] Speaker 04:
It has never alleged a takings claim.

[00:30:09] Speaker 04:
All of its arguments hinge on the idea of some sort of taking, right?

[00:30:14] Speaker 04:
We had a right and only, to quote my opposing counsel,

[00:30:18] Speaker 04:
The only statute at issue here is the FAST Act, because the FAST Act took away our right.

[00:30:24] Speaker 04:
This is not a takings case.

[00:30:27] Speaker 04:
This is a statutory benefit case.

[00:30:29] Speaker 04:
Where is the waiver of sovereign immunity?

[00:30:31] Speaker 04:
It's in Fagrama.

[00:30:33] Speaker 04:
If the right exists, it exists because some part of Fagrama survived the FAST Act.

[00:30:39] Speaker 04:
Well, what survived?

[00:30:40] Speaker 04:
And we would submit, based on De La Rama, you cannot parse

[00:30:44] Speaker 04:
The individual clauses in Section 1721H, if the right in Section 1721H survived, so too did the Congress... What if Congress had explicitly in the Act said, we're repealing the whole thing, including all of the procedures that went with it.

[00:31:00] Speaker 03:
All gone, no more funding for any of those.

[00:31:03] Speaker 03:
What would have been the recourse then?

[00:31:09] Speaker 04:
I think if that's what it said, the whole thing is gone.

[00:31:13] Speaker 03:
That's not hypothetical.

[00:31:14] Speaker 04:
And it still did not address retroactivity, well, then it would survive for purposes of the pre-repeal accrued rights.

[00:31:25] Speaker 03:
And then they could seek those at the Court of Claims, as they did here.

[00:31:28] Speaker 03:
That would be the only avenue in which they could seek relief.

[00:31:33] Speaker 04:
No, because 1724, all the fast act did was strike 1721.

[00:31:38] Speaker 04:
1724 has always existed and has continued uninterrupted, regardless of the Fast Act.

[00:31:48] Speaker 04:
1724 is where the administrative regime is, right?

[00:31:52] Speaker 04:
If you have a dispute with any order or decision

[00:31:57] Speaker 04:
of the secretary, you must follow this administration.

[00:32:00] Speaker 03:
OK, what if hypothetically the Congress had repealed the statute and said, and you can't use 724, whatever that other citation is, for purposes of processing your claims under this now repeal provision?

[00:32:13] Speaker 04:
It would depend on whether or not Congress spoke with respect to pre-repeal accrued rights.

[00:32:22] Speaker 04:
Right?

[00:32:23] Speaker 04:
It's well established that repeals by implication are disfavored, right?

[00:32:29] Speaker 04:
So you'd be looking at statutory intent.

[00:32:31] Speaker 04:
Is there any evidence in the statute's repeal or in the legislative history as to whether or not Congress intended this to have retroactive effect?

[00:32:41] Speaker 04:
If not, if the statute is silent as it was here, we have the general savings statute.

[00:32:48] Speaker 04:
Congress has spoken with one USC 109

[00:32:53] Speaker 03:
OK.

[00:32:54] Speaker 03:
Thank you.

[00:32:55] Speaker 03:
We thank both sides in the cases.