Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca9-13-35854/USCOURTS-ca9-13-35854-0/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 

---

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

LACANO INVESTMENTS, LLC,

NOWELL AVENUE DEVELOPMENT,

and AVA L. EADS, on behalf of

themselves and the class they seek to

represent,

Plaintiffs-Appellants,

v.

JOE BALASH, Commissioner, Alaska

Department of Natural Resources, in

his official capacity, BRENT

GOODRUM, Director, Division of

Minding Land & Water, Alaska

Department of Natural Resources,

Defendants-Appellees.

No. 13-35854

D.C. No.

1:12-CV-00014-

TMB

OPINION

Appeal from the United States District Court

for the District of Alaska

Timothy M. Burgess, District Judge, Presiding

Argued and Submitted

June 3, 2014—Anchorage, Alaska

Filed August 28, 2014

Before: J. Clifford Wallace, Kim McLane Wardlaw,

and Morgan Christen, Circuit Judges.

Opinion by Judge Wallace

 Case: 13-35854, 08/28/2014, ID: 9221993, DktEntry: 35-1, Page 1 of 15
2 LACANO INVESTMENTS V. BALASH

SUMMARY*

Sovereign Immunity

The panel affirmed the dismissal for lack of subject

matter jurisdiction of an action against Alaska officials who

determined that under the Submerged Lands Act of 1953,

streambeds claimed by the plaintiffs were owned by the State

of Alaska.

The panel held the plaintiffs could not avoid a motion to

dismiss under Federal Rule of Civil Procedure 12(b)(1)

merely because they asserted in their complaint that Alaska

did not own the streambeds.

The panel held that state sovereign immunity barred the

action because the Ex parte Young doctrine, providing that

the Eleventh Amendment does not bar actions when

individual citizens seek only injunctive or prospective relief

against state officials who would have to implement a state

law that is allegedly inconsistent with federal law, did not

apply. The panel concluded that under the exception to Ex

parte Young set forth in Idaho v. Coeur d’Alene Tribe of

Idaho, 521 U.S. 261 (1997), the relief the plaintiffs sought

was close to the functional equivalent of quiet title.

* This summary constitutes no part of the opinion of the court. It has

been prepared by court staff for the convenience of the reader.

 Case: 13-35854, 08/28/2014, ID: 9221993, DktEntry: 35-1, Page 2 of 15
LACANO INVESTMENTS V. BALASH 3

COUNSEL

Gina Marie Cannan (argued), Steven J. Lechner, Mountain

States Legal Foundation, Lakewood, Colorado; Eric Twelker,

Juneau, Alaska, for Plaintiffs-Appellants.

Jessica Moats Alloway (argued), Assistant Attorney General,

State of Alaska Department of Law, Anchorage, Alaska;

Vanessa Maria Lamantia, Assistant Attorney General, State

of Alaska Department of Law, Juneau, Alaska, for

Defendants-Appellees.

OPINION

WALLACE, Circuit Judge:

Plaintiffs-Appellants Lacano Investments, LLC, Nowell

Avenue Development, and Ava L. Eads, allege that they hold

land patents that were issued by the federal government many

years before Alaska entered the Union. The patents give title

to certain streambeds in Alaska. In 2010 and 2011, the Alaska

Department of Natural Resources determined that the

waterways above these streambeds were navigable in 1959,

the year Alaska was admitted to the Union, and remain

navigable. Under the Submerged Lands Act of 1953, all land

beneath such waterways belongs to the State of Alaska. See

43 U.S.C. § 1311(a) (“[i]t is determined and declared to be in

the public interest that (1) title to and ownership of the lands

beneath navigable waters within the boundaries of the

respective States . . . are, subject to the provisions hereof,

recognized, confirmed, established, and vested in and

assigned to the respective States”); Act to Provide for the

Admission of the State of Alaska into the Union, Pub. L. No.

 Case: 13-35854, 08/28/2014, ID: 9221993, DktEntry: 35-1, Page 3 of 15
4 LACANO INVESTMENTS V. BALASH

85-508, 72 Stat. 339, 343 § 6(m) (1958) (“[t]he Submerged

Lands Act of 1953 shall be applicable to the State of Alaska

and the said State shall have the same rights as do existing

States thereunder”). The Department sent letters to Plaintiffs

with the navigability determinations and its conclusion that

the streambeds are “state-owned.”

According to Plaintiffs, Alaska’s determination that the

waterways have been navigable since 1959 does not disturb

the title to the land that was granted to them by the federal

patents. Plaintiffs sued the Alaska officials who made the

navigability determinations in federal court. Plaintiffs allege

that they retain title to the disputed lands because, under the

Submerged Lands Act, streambeds that had already been

patented by the federal government were not granted to

Alaska upon its statehood. See 43 U.S.C. § 1301(f) (“[t]he

term ‘lands beneath navigable waters’ [that belongs to the

states] does not include the beds of streams in lands . . . if

such streams were not meandered in connection with the

public survey of such lands under the laws of the United

States and if the title to the beds of such streams was lawfully

patented or conveyed by the United States”). Plaintiffs sought

a declaratory judgment that the navigability determinations,

and thus the conclusions that the streambeds were stateowned, violated 43 U.S.C. § 1301(f), as well as an injunction

prohibiting Defendants from claiming title to the lands

beneath the waterways.

The state officials moved to dismiss the complaint under

Federal Rule of Civil Procedure 12(b)(1), for lack of subject

matter jurisdiction. The district court agreed, and dismissed

the action with prejudice.

 Case: 13-35854, 08/28/2014, ID: 9221993, DktEntry: 35-1, Page 4 of 15
LACANO INVESTMENTS V. BALASH 5

Plaintiffs filed a timely notice of appeal. We review a

district court’s decision to grant a motion to dismiss for lack

of subject matter jurisdiction de novo. Colony Cove Props.,

LLC v. City of Carson, 640 F.3d 948, 955 (9th Cir. 2011). We

review the district court’s denial of leave to amend for abuse

of discretion. Airs Aromatics, LLC v. Opinion Victoria’s

Secret Stores Brand Mgmt., Inc., 744 F.3d 595, 598 (9th Cir.

2014). We have jurisdiction under 28 U.S.C. § 1291, and

affirm.

I.

The state officials moved to dismiss the complaint. The

“jurisdictional attack” in their motion was “facial,” which

means that the state officials “assert[] that the allegations

contained in [the] complaint are insufficient on their face to

invoke federal jurisdiction,” but the officials do not “dispute[]

the truth of the allegations.” Safe Air for Everyone v. Meyer,

373 F.3d 1035, 1039 (9th Cir. 2004). In this facial attack, we

must accept all of the factual allegations in the complaint as

true. Wolfe v. Strankman, 392 F.3d 358, 362 (9th Cir. 2004).

Plaintiffs argue that because we must accept all of their

factual allegations as true, we must reverse the district court,

insofar as the complaint alleges that the lands are by

definition not submerged, state-owned, lands under federal

law. In other words, Plaintiffs argue that because we accept

the allegations in the complaint as true, at this stage of the

litigation we must conclude that Alaska has no interest in the

lands under Plaintiffs’ complaint, which means that it was

error to dismiss the complaint for lack of subject matter

jurisdiction.

 Case: 13-35854, 08/28/2014, ID: 9221993, DktEntry: 35-1, Page 5 of 15
6 LACANO INVESTMENTS V. BALASH

While we do accept all of the factual allegations in the

complaint as true, id., we do not accept legal conclusions in

the complaint as true, even if “cast in the form of factual

allegations.” Doe v. Holy See, 557 F.3d 1066, 1073 (9th Cir.

2009) (citation omitted). Plaintiffs’ complaint does not

include factual allegations that the streambeds are privately

owned under the Submerged Lands Act. Instead, the

complaint contains only legal conclusions to that effect:

“[t]he Alaska Statehood Act delineates the terms under which

statehood was granted” and thus Plaintiffs’ lands are

“exempted from the Submerged Lands Act”; “Plaintiff

Lacano is the fee simple owner of record . . . ”; “Plaintiff

Nowell is the fee simple owner of record . . .”; “Plaintiff Eads

is the fee simple owner . . . ”.

Further, we also “may look beyond the complaint and

consider extrinsic evidence.” Warren v. Fox Family

Worldwide, Inc., 328 F.3d 1136, 1141 n.5 (9th Cir. 2003).

Attached to the complaint are the letters sent by the

Department of Natural Resources, upon which the complaint

relies to explain the basis of Plaintiffs’ action. Those letters

demonstrate Alaska’s claim of ownership to the disputed

properties.

Thus, Plaintiffs cannot avoid a motion to dismiss under

Rule 12(b)(1) merely because they asserted in their complaint

that Alaska does not own the streambeds. See, e.g., W.

Mohegan Tribe and Nation v. Orange Cnty., 395 F.3d 18, 20,

23 (2d Cir. 2004) (dismissing a complaint for lack of subject

matter jurisdiction despite “accepting the factual allegations

contained in the complaint as true” where the complaint

asserted that the plaintiffs, rather than the State of New York,

held title to disputed lands).

 Case: 13-35854, 08/28/2014, ID: 9221993, DktEntry: 35-1, Page 6 of 15
LACANO INVESTMENTS V. BALASH 7

II.

We next consider whether state sovereign immunity bars

Plaintiffs’ action. The Eleventh Amendment bars federal

courts from hearing certain “suit[s]” filed by individual

citizens against a state without the consent of the state. U.S.

Const. amend. XI; see generally Hans v. Louisiana, 134 U.S.

1 (1890). But that Amendment does not bar actions when

citizens seek onlyinjunctive or prospective relief against state

officials who would have to implement a state law that is

allegedly inconsistent with federal law. See generally Ex

parte Young, 209 U.S. 123 (1908). “The Ex parte Young

doctrine is founded on the legal fiction that acting in violation

of the Constitution or federal law brings a state officer into

conflict with the superior authority of the Constitution, and he

is in that case stripped of his official or representative

character and is subjected in his person to the consequences

of his individual conduct.” Cardenas v. Anzai, 311 F.3d 929,

935 (9th Cir. 2002) (internal quotation marks omitted) (citing

Young, 209 U.S. at 159–60). Not all actions that solely seek

prospective relief against state officials fall within the Young

exception, however. See Idaho v. Coeur d’Alene Tribe of

Idaho, 521 U.S. 261 (1997).

A.

In Coeur d’Alene, the Coeur d’Alene Tribe sued the State

of Idaho and state officers who enforced Idaho law in federal

court, alleging an interest under federal law in lands

submerged under navigable waterways within the original

boundaries of the Coeur d’Alene Reservation. Id. at 264–65.

Those lands had been “long deemed by [Idaho] to be an

integral part of its territory.” Id. at 282. The Tribe brought

title claims, sought a declaratory judgment to establish its

 Case: 13-35854, 08/28/2014, ID: 9221993, DktEntry: 35-1, Page 7 of 15
8 LACANO INVESTMENTS V. BALASH

right to use and occupy the lands, and sought an injunction

prohibiting Idaho from infringing upon its rights to the land.

Id. at 265. The “underlying dispute” was “[w]hether the

Coeur d’Alene Tribe’s ownership extends to the banks and

submerged lands of [] [L]ake [Coeur d’Alene] and various . . .

rivers and streams [within the boundaries of the Coeur

d’Alene Reservation] . . . or instead ownership is vested in the

State of Idaho.” Id. at 264.

Idaho moved to dismiss the complaint on Eleventh

Amendment sovereign immunity grounds. Id. at 265. When

the case reached the Supreme Court, a five-Justice majority

agreed that the Eleventh Amendment barred the action. Id. at

288; id. at 296–97 (O’Connor, J., concurring).

Justice Kennedy’s principal opinion was joined in part by

four other members of the Supreme Court. The principal

opinion recognized that “[a]n allegation of an ongoing

violation of federal law where the requested relief is

prospective is ordinarily sufficient to invoke the Young

fiction.” Coeur d’Alene, 521 U.S. at 281. But the case was

“unusual in that the Tribe’s suit [was] the functional

equivalent of a quiet title action which implicates special

sovereignty interests.” Id. According to the principal opinion,

the parties (and the Court) agreed “that the Tribe could not

maintain a quiet title suit against Idaho in federal court, 

absent the State’s consent.” Id.

Although the Tribe was not actually seeking quiet title

relief, the Court concluded that the declaratory and injunctive

relief the Tribe sought was “close to the functional equivalent

of quiet title.” Id. at 282. This similarity to a quiet title action

was “especially troubling when coupled with the far-reaching

and invasive relief the Tribe seeks,” which if successful

 Case: 13-35854, 08/28/2014, ID: 9221993, DktEntry: 35-1, Page 8 of 15
LACANO INVESTMENTS V. BALASH 9

“would bar the State’s principal officers from exercising their

governmental powers and authority over the disputed lands

and waters” because the Tribe had independent sovereign

authority. Id. The Court looked to “the realities of the relief

the Tribe demand[ed].” Id. Because of the historical and legal

importance of submerged lands to state sovereignty, the Court

held that “if the Tribe were to prevail, Idaho’s sovereign

interest in its lands and waters would be affected in a degree

fully as intrusive as almost any conceivable retroactive levy

upon funds in its Treasury.” Id. at 287. Thus, “[t]he dignity

and status of its statehood allow[ed] Idaho to rely on its

Eleventh Amendment immunity,” and the Court ordered the

Tribe’s action dismissed. Id. at 287–88.

Justices O’Connor, Scalia and Thomas joined in the

portions of Coeur d’Alene described above, and joined in full

a separate partial concurrence written by Justice O’Connor.

Although this was only a partial concurrence, we analyze it

along with the principal opinion in which only two Justices

concurred to determine what part of the principal opinion was

agreed upon by the five-Justice majority of the Court. See

Agua Caliente, 223 F.3d at 1046 (discussing both the

principal opinion and concurrence of Coeur d’Alene). In her

concurrence, Justice O’Connor agreed that “[t]his case is

unlike a typical Young action,” and thus barred by the

Eleventh Amendment, for two reasons. 521 U.S. at 289

(O’Connor, J., concurring). First, the Tribe’s action was “the

functional equivalent of an action to quiet [the Tribe’s] title

to the bed of Lake Coeur d’Alene,” which was not acceptable

under the Eleventh Amendment because “[a] federal court

cannot summon a State before it in a private action seeking to

divest the State of a property interest.” Id. Second, “the Tribe

does not merely seek to possess [the] land . . . [but] seeks to

eliminate altogether the State’s regulatory power over the

 Case: 13-35854, 08/28/2014, ID: 9221993, DktEntry: 35-1, Page 9 of 15
10 LACANO INVESTMENTS V. BALASH

submerged lands at issue.” Id. Justice O’Connor concluded

that these distinctions from the “typical Young action” meant

that “the Tribe’s suit must be dismissed.” Id. at 291.

B.

Here, Plaintiffs’ action implicates precisely the same

sovereignty interests as in Coeur d’Alene itself. In their

complaint, Plaintiffs allege they are “fee simple owners” of

the streambeds beneath the navigable waters, seek to lift the

“cloud” from their properties, and request that a federal court

return “full use and enjoyment of their property.” The relief

Plaintiffs request “is close to the functional equivalent of

quiet title.” Id. at 282. The lands at issue are streambeds

beneath navigable waters, which are “lands with a unique

status in the law and infused with a public trust.” Id. at 283.

If the court were to rule in Plaintiffs’ favor, the “benefits of

ownership and control would shift from the State” to

Plaintiffs. Id. at 282. Thus, the Eleventh Amendment bars this

action.

Coeur d’Alene provides only a “unique” and “narrow”

exception to Young, and does not “bar all claims that affect

state powers, or even important state sovereignty interests.”

Agua Caliente, 223 F.3d at 1048. But when an action

implicates the “exact issues” of Coeur d’Alene itself, namely

“navigability of waters or the state’s control over submerged

lands,” federal courts lack jurisdiction to hear the case.

Anderson-Tully Co. v. McDaniel, 571 F.3d 760, 763 (8th Cir.

2009). This case presents the same issues as Coeur d’Alene.

Although we affirm the district court’s judgment that it

lacked jurisdiction over this action, we do not affirm its

reasoning. Guided by the parties, the district court made a

 Case: 13-35854, 08/28/2014, ID: 9221993, DktEntry: 35-1, Page 10 of 15
LACANO INVESTMENTS V. BALASH 11

good-faith effort to determine whether Alaska has a sufficient

interest in the lands to assert Eleventh Amendment immunity,

and did so by analogizing to other circumstances in which a

government entity claims title to property. But that attempt to

assess the interest in the property held by the state is not

necessary under Coeur d’Alene. The approach we take

instead is “functional”: we compare the relief sought by

Plaintiffs to a quiet title action, and dismiss because it was

“close to the functional equivalent” of such an action, as the

lands at issue are submerged lands beneath navigable waters,

which have a “unique status in the law” insofar as “[s]tate

ownership of them has been considered an essential attribute

of sovereignty.” 521 U.S. at 282–83 (internal quotation marks

and citation omitted); see also Agua Caliente, 223 F.3d at

1046 (“[t]he challenge posed by Coeur d’Alene is to figure

out whether the Tribe’s claims here are of the same character

as those in Coeur d’Alene”).

C.

We next turn to Plaintiffs’ counterarguments.

1.

Plaintiffs first suggest that Coeur d’Alene is no longer

good law. They assert that we should instead follow the

SupremeCourt’smore recent guidance, that “[i]n determining

whether the doctrine of Ex parte Young avoids an Eleventh

Amendment bar to suit, a court need only conduct a

‘straightforward inquiry into whether [the] complaint alleges

an ongoing violation of federal law and seeks relief properly

characterized as prospective.’” Verizon Md., Inc. v. Pub. Serv.

Comm’n of Md., 535 U.S. 635, 645 (2002) (quoting Coeur

d’Alene, 521 U.S. at 296).

 Case: 13-35854, 08/28/2014, ID: 9221993, DktEntry: 35-1, Page 11 of 15
12 LACANO INVESTMENTS V. BALASH

But Coeur d’Alene remains binding upon us. Verizon did

not overrule Coeur d’Alene, and in fact the Court quoted

language from the earlier opinion. Moreover, the Court

recently affirmed Coeur d’Alene’s core holding that the

Eleventh Amendment bars actions that are “the functional

equivalent of a quiet title suit” against a state. Va. Office for

Prot. and Advocacy v. Stewart, 131 S. Ct. 1632, 1639–40

(2011) (quoting Coeur d’Alene, 521 U.S. at 282). To the

extent there is some tension between the “straightforward

inquiry” recognized in Verizon and the “unique” and

“narrow” circumstances of Coeur d’Alene, we must follow

Coeur d’Alene, “which directly controls, leaving to [the

Supreme] Court the prerogative of overruling its own

decisions.” Agostini v. Felton, 521 U.S. 203, 237 (1997)

(citation omitted).

2.

Plaintiffs next argue that this case is “the exact opposite

factual situation” of Coeur d’Alene, because here Alaska

sought to divest Plaintiffs of their alleged longstanding title,

whereas in Coeur d’Alene, it was the plaintiffs who sought to

divest the state of its longstanding title. But that is not a

proper distinction of Coeur d’Alene. The majority opinion

was not predicated upon the length of the state’s claim to

title. Instead, it was based upon the “principle that

[submerged lands beneath navigable waters] are tied in a

unique way to sovereignty,” regardless of when the state

determined that the waters were navigable. 521 U.S. at 286;

see also Anderson-Tully, 571 F.3d at 761 (dismissing under

Coeur d’Alene despite the recency of the state’s title claim to

the submerged lands).

 Case: 13-35854, 08/28/2014, ID: 9221993, DktEntry: 35-1, Page 12 of 15
LACANO INVESTMENTS V. BALASH 13

3.

Finally, Plaintiffs attempt to distinguish their action from

that in Coeur d’Alene because there, if the tribe were to have

been awarded the property, it would have deprived the State

of Idaho of “all regulatory power” over the submerged lands.

This is true: federally-recognized tribes are themselves

sovereigns. See, e.g., Coeur d’Alene, 521 U.S. at 268 (stating

that “Indian tribes . . . should be accorded the same status as

foreign sovereigns”). If the Coeur d’Alene Tribe were

awarded title, Idaho may not have had any regulatory

authority at all over the disputed lands. Because Plaintiffs in

this case are not a separate sovereign, they argue that “Alaska

would remain free to exercise lawful regulatory jurisdiction

over Landowners’ property as they do over other private

lands.” According to Plaintiffs, this case is distinguishable

from Coeur d’Alene because there is no threat that “all

regulatory power” would be divested from Alaska.

This is not a sufficient distinction of Coeur d’Alene. Both

the principal opinion and Justice O’Connor’s concurrence

mention tribal sovereignty as a consideration to support the

conclusion that the action should be dismissed. But neither

opinion considered this determinative.

The principal opinion discussed the Tribe’s sovereign

character, which meant its action sought “far-reaching and

invasive relief” that was “in effect, a determination that the

lands in question are not even within the regulatory

jurisdiction of the State.” Id. at 282. At that point in the

opinion, however, the majority had already concluded that

“Eleventh Amendment would bar” “a quiet title suit against

Idaho” or relief that “is close to the functional equivalent of

quiet title” in federal court. Id. at 281–82. The fact that the

 Case: 13-35854, 08/28/2014, ID: 9221993, DktEntry: 35-1, Page 13 of 15
14 LACANO INVESTMENTS V. BALASH

plaintiff was a federally recognized tribe only made the

Tribe’s action “especially troubling” in its impact on state

sovereignty. Id. at 282.

Similarly, Justice O’Connor had two bases for

distinguishing the case from a typical Young action that could

be heard in federal court. Id. at 289 (O’Connor, J.,

concurring). First, “the suit is the functional equivalent of an

action to quiet [the plaintiff’s] title to the bed of Lake Coeur

d’Alene.” Id. “A federal court cannot summon a State before

it in a private action seeking to divest the State of a property

interest.” Id. It was only her second basis that discussed the

tribe’s attempt to divest Idaho of all regulatory power. Even

in that context, she continued to make clear that “[c]ontrol of

[submerged lands] is critical to a State’s ability to regulate

use of its navigable waters.” Id. Thus, in Justice O’Connor’s

view, states must possess actual control over submerged lands

in order to regulate properly the use of navigable waters.

Because the tribe sought “in effect[] to invoke a federal

court’s jurisdiction to quiet title to sovereign lands,” Justice

O’Connor concluded that the action had to be dismissed. Id.

at 296.

Thus, we conclude that the identity of plaintiffs is not

dispositive in cases that implicate the Coeur d’Alene

exception to Ex parte Young. See also Anderson-Tully Co.,

571 F.3d at 763 (ordering dismissal of an action filed by a

private party under Coeur d’Alene); MacDonald, 164 F.3d at

972 (same). Federal courts lack jurisdiction over all actions

where a plaintiff seeks relief that is “close to the functional

equivalent of quiet title” over submerged lands that have a

“unique status in the law” and which are “infused with a

public trust.” Coeur d’Alene, 521 U.S. at 282–83.

 Case: 13-35854, 08/28/2014, ID: 9221993, DktEntry: 35-1, Page 14 of 15
LACANO INVESTMENTS V. BALASH 15

III.

Finally, Plaintiffs argue that the district court erred in

denying them leave to amend their complaint. But this was

not an abuse of discretion. As should be clear, any

amendment would be futile. No set of facts pleaded by

Plaintiffs would allow their complaint to proceed, given

Coeur d’Alene.

AFFIRMED.

 Case: 13-35854, 08/28/2014, ID: 9221993, DktEntry: 35-1, Page 15 of 15