## F I L E D United States Court of Appeals Tenth Circuit 

### JUN 16 1999 

### PATRICK FISHER Clerk PUBLISH
UNITED STATES COURT OF APPEALS FOR THE TENTH CIRCUIT

MOBIL EXPLORATION & PRODUCING U.S., INC., and MOBIL CORPORATION, Plaintiffs, and OXY USA INC. and OCCIDENTAL OIL AND GAS CORPORATION, Plaintiffs - Appellants, No. 98-5009

v. DEPARTMENT OF INTERIOR, sued as: Bruce Babbitt, Secretary, Department of the Interior; Cynthia Quarterman, Director, Minerals Management Service, Department of the Interior; Erasmo Gonzales, Chief, Houston Compliance Division, Minerals Management Service, Department of the Interior; and Gary L. Johnson, Chief, Dallas and Tulsa Compliance Offices, Minerals Management Service, Department of the Interior, Defendants - Appellees.

APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF OKLAHOMA

(D.C. No. 96-CV-790-K)

_________________________-2-

Submitted on the briefs: Patricia Dunmire Bragg and Stephen R. Ward of Garde re & Wynne, L.L.P., Tulsa Oklahoma; Oliver S. Howard, Teresa B. Adwan, and De nnis C. Cameron of Gable, Gotwals, Mock, Schwabe, Kihle, and Gaberino, Tulsa, Oklahoma; Patricia A. Patten of Oxy USA Inc., Tulsa, Oklahoma, for OxyUSA Inc. and Occidental Oil and Gas Corporation. David L. Bryant and Alind a F. Stephenson of Bryant Law Firm, Tulsa, Oklahoma; Deborah B. Haglund of Mo bil Business Resources Corp., Dallas Texas, for Mobil Exploration & Produc ing U.S. Inc. and Mobil Corporation. Lois J. Schiffer, Assistant Attorney General; DonnaS. Fitzgerald and Robert L. Klarquist, Attorneys, Department of Justice; Ivan K . Fong, Deputy Associate Attorney General, Washington, D.C.; and Geoffrey He ath and Howard Chalker, Office of the Solicitor, Department of the Interior , Washington, D.C., for Defendants-Appellees.

_________________________ Before BALDOCK , McKAY , and BRORBY , Circuit Judges.

_________________________ McKAY , Circuit Judge.

_________________________

After examining the briefs and the appellate record , this panel has determined unanimously that oral argument would notmaterially assist the determination of this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is therefore ordered submitted without ora l argument. Plaintiffs Occidental Oil & Gas Co. and its subsidi ary OXY USA, Inc., appeal the district court’s order on cross-motions for summary judgment1 Plaintiffs Mobil Exploration & Producing U.S., Inc. , and Mobil

Corporation were dismissed from this appeal by this court’s Order filed January 6, 1999. -3- determining that it lacked subject matter jurisdict ion over this action. 1 We exercise jurisdiction under 28 U.S.C. § 1291.

I. Plaintiffs are federal oil and gas lessees in Calif ornia on leases issued under the Mineral Leasing Act, 30 U.S.C. §§ 181-287 , and the Outer Continental Shelf Lands Act, 43 U.S.C. §§ 1331-1356. Defendant s, the Secretary of the Interior, the Department of the Interior, and the M inerals Management Service [MMS], are responsible for administering oil and ga s leases for federal, Indian, and tribal lands issued under the mineral leasing l aws. See generallyFederal Oil and Gas Royalty Management Act of 1982 [FOGRMA], 30 U.S.C. §§ 1701-1757. The MMS is the agency within the Department of the Interior responsible for determining royalty value and collecting royalties due on federal or Indian oil and gas leases. On July 18, 1996, the MMS sent a letter to OXY stat ing that it was “conducting a review of the valuation of crude oil for royalty purposes . . . [which would] cover crude oil and related transactions forJanuary 1, 1980 through [July 31, 1996].” Appellants’ App., Vol. II, Doc. 12 at 342. The letter also stated:-4-

MMS requests OXY to keep all records related to its California operations for the audit period. [MMS] also reques t[s] access to all documents and information in OXY’s possession relat ed to the production and disposition of crude oil for the aud it period. An initial request for information is set forth in the Enclosure. Additional records and information necessary to complete the audit will be requested as needed. Id. Plaintiffs did not respond to the letter nor did they provide the MMS with access to the documents requested. Consequently, o n September 4, 1996, the MMS issued an administrative subpoena to Occidental to produce information pursuant to 30 U.S.C. §§ 1711, 1713(a), and 1717(a) by September 30, 1996. See id. at 368-71. Although Plaintiffs turned over docume nts maintained for the six years prior to July 31, 1996, they have not complie d with the subpoena to the extent that it orders the production of documents g enerated before July 31, 1990. Plaintiffs brought this action in the United States District Court for the Northern District of Oklahoma seeking two results: (1) a declaratory judgment that the document request letter and the administrative subpoena relating to the MMS audit are invalid; and (2) injunctive relief ba rring or preventing enforcement of the document request letter and the subpoena. Defendants filed a motion to dismiss the action pursuant to Rules 12(b )(1) and 12(b)(6) of the Federal Rules of Civil Procedure. The district cou rt denied the motion but stated that it would revisit the jurisdictional issue on s ummary judgment. The parties then filed cross-motions for summary judgment. Def endants again claimed that2 The United States District Court for the Central Di strict of California

dismissed the enforcement action without prejudice because the instant case was pending in the Northern District of Oklahoma. -5- the court did not have subject matter jurisdiction. With respect to whether Plaintiffs’ claim objecting to the document request letter was ripe for review, and relying partly on t he government’s disavowal that it would pursue penalties against Plaintiffs under 30 U.S.C. § 1719(c)(2), the district court found that the letter did not impose any legal obligation on Plaintiffs. Additionally, even assuming that a leg al obligation existed, the court found that the letter did not constitute final agen cy action because it was not the consummation of the agency’s decisionmaking process

. The district court also determined that because the administrative subpoenas were not self-executing and because no en forcement action had been filed in the Northern District of Oklahoma, review of Plaintiffs’ complaint would contradict the general rule against reviewing pre-e nforcement actions. Although Defendants had filed an enforcement action against Plaintiffs in the Central District of California, the court did not believe t hat the enforcement action conferred jurisdiction in the Northern District of Oklahoma. 2 Therefore, the court held that it was “not persuaded that an anticipatory action challenging the validity of an administrative subpoena confers jurisdiction on this Court.” Id. , Doc. 23 at
909.-6-

In response to Plaintiffs’ claim that “dismissal of this action would condemn them to maintain records beyond the six-year statute of limitation” set forth in 30 U.S.C. § 1713(b), id. at 913, the court held that “there is no per se ru le against document requests by the MMS beyond the six -year statute of limitation.” Id. at 914. Finally, the district court cast aside Pl aintiffs’ assertion that the MMS’ initiation of the audits exceeded its statutory aut hority. The court held that this case did not “‘present one of the extraordinary exc eptions to the [final agency action] requirement.’” Id. at 915 (quoting Veldhoen v. United States Coast Guard , 35 F.3d 222, 225 (5th Cir. 1994)). Accordingly, the district court concluded that it lacked subject matter jurisdictio n because Plaintiffs’ claims were not ripe for review, and it granted summary ju dgment to Defendants.

II. We review orders granting or denying summary judgme nt de novo. See Phillips Petroleum Co. v. Lujan , 963 F.2d 1380, 1384 (10th Cir. 1992) (Phillips
II ). Summary judgment is appropriate “if the pleadin gs, depositions, answers to interrogatories, and admissions on file, together w ith the affidavits, if any, show that there is no genuine issue as to any material f act and that the moving party is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(c); see Wolf v. Prudential Ins. Co. of Am. , 50 F.3d 793, 796 (10th Cir. 1995). “If there is no-7-

genuine issue of material fact in dispute, then we next determine if the substantive law was correctly applied by the distri ct court.” Wolf , 50 F.3d at 796. On appeal, Plaintiffs argue that the court erred in determining that it did not have jurisdiction and they essentially repeat the a rguments they made to the district court. They assert that the district court possesses subject matter jurisdiction because the document request letter an d the administrative subpoena constitute final agency actions which are ripe for review. In the alternative, Plaintiffs contend that their claims are reviewable because the MMS exceeded its statutory authority in initiating the audit relatin g to, ordering the retention and disclosure of, and issuing the subpoena for documents more than six years old. Defendants respond that the district court correctl y determined that Plaintiffs’ claims were not ripe for judicial review.

III. The Administrative Procedure Act provides a right t o judicial review of “final agency action for which there is no other ad equate remedy in a court.” 5 U.S.C. § 704. Under the APA, a court is authoriz ed to “hold unlawful and set aside agency action, findings, and conclusions foun d to be . . . arbitrary, capricious, an abuse of discretion, or otherwise no t in accordance with law,” or “in excess of statutory jurisdiction, authority or limitations.” Id. § 706(2)(A) &-8-

(C). “[B]efore a court may review an agency decisi on, it must evaluate ‘the fitness of the issues for judicial review and the h ardship to the parties of withholding court consideration.’” Ash Creek Minin g Co. v. Lujan , 934 F.2d 240, 243 (10th Cir. 1991) (quoting Abbott Lab. v. G ardner , 387 U.S. 126, 149 (1967)). Our application of the doctrine of ripene ss prevents courts from entangling themselves in administrative policy disa greements and “protect[s] the agencies from judicial interference until an admini strative decision [is] formalized and its effects felt in a concrete way b y the challenging parties.” Abbott Lab. , 387 U.S. at 148. In evaluating claims pursuant to the ripeness doctr ine, we generally consider four factors: (1) whether the issues in the case are purely legal ; (2) whether the agency action is “final agency action” within the m eaning of the Administrative Procedure Act, 5 U.S.C. § 704; (3) w hether the action has or will have a direct and immediate impact upon the plaintiff[;] and (4) whether the resolution of the issues will p romote effective enforcement and administration by the agency. Ash Creek , 934 F.2d at 243 (citing Abbott Lab. , 387 U.S. at 149-54). As to the first factor, the parties do not dispute that the i ssues before us are purely legal. The second factor, however, is particularly pertine nt to our review of this case because the parties fundamentally disagree about wh ether the July 1996 document request letter and the administrative subpoena cons titute final agency action.-9-

A. Final Agency Action It is well established that the finality of an admi nistrative action depends on whether the action “‘impose[s] an obligation, den[i es] a right or fix[es] some legal relationship as a consummation of the adminis trative process.’” Id. (citation omitted); see also Phillips II , 963 F.2d at 1387. More recently, the Supreme Court has articulated this test for final agency ac tion as having two conditions. “First, the action must mark the ‘consummation’ of the agency’s decisionmaking process . . . . And second, the action must be one by which ‘rights or obligations have been determined,’ or from which “legal consequ ences will flow.’” Bennett v. Spear , 520 U.S. 154, 177-78 (1997) (citations omitted); see also Franklin v. Massachusetts , 505 U.S. 788, 797 (1992) (stating test as “whethe r the agency has completed its decisionmaking process, and whether the result of that process is one that will directly affect the parties”).

1. Document Request Letter Plaintiffs argue that the document request letter, which they characterize as an “audit engagement order,” is reviewable final ag ency action for three reasons: (1) it imposes a legal obligation to retain royalty records for the audit period; (2) it represents the consummation of the administr ative process; and (3) there is no other adequate remedy under the Administrative P rocedure Act.3 To support their arguments on both the consummationand the legal

consequences prongs, Plaintiffs seem to rely on the apparent stipulation by the parties in a proposed order of dismissal that the l etter to OXY initiated an audit. See Appellants’ App., Vol. II, Doc. 12 at 479. We poi nt out that the district court never signed the proposed order containing this sti pulation. Further, the document request letter states only that the MMS “p lan[ned] to initiate this audit no later than 30 days from [OXY’s] receipt of this letter.” Id. at 343. Thus, while we accept that the letter notified OXY that a n audit would be commenced, the unsigned stipulation by the parties has no bear ing on whether the letter initiated the audit or was the consummation of the MMS’ decisionmaking process. -10- Under the Bennettframework, the first question before us is whetherthe letter sent by the MMS to OXY constituted the consu mmation of the MMS’ decisionmaking process for purposes of our finalitydetermination. Plaintiffs seem to argue that the letter consummated the MMS’ decisionmaking process about whether to conduct an audit because the lette r initiated an audit under 30 U.S.C. § 1713(b) and the initiation of an audit req uires Plaintiffs to retain all records for the audit period until the Secretary re leases them from that obligation. 3 The statute provides that a lessee must maintain records “for 6 years after [they] are generated unless the Secretary not ifies the record holder that he has initiated an audit or investigation involving r ecords and that such records must be maintained for a longer period.” 30 U.S.C. § 1713(b) (emphasis added). While we are initially guided by the Supreme Court’ s instruction that an action of “a merely tentative or interlocutory natu re” does not mark the consummation of an agency action, Bennett , 520 U.S. at 178, the Court’s decision-11-

in FTC v. Standard Oil Co. of Cal. , 449 U.S. 232 (1980), further elucidates what type of action may constitute the consummation of t he agency decisionmaking process. In Standard Oil , the Court held that the FTC’s issuance of a compl aint averring that it had reason to believe that eight m ajor oil companies were violating the Federal Trade Commission Act was not final agency action. See id. at 246. The Court reasoned that the FTC’s avermentof “reason to believe” that the oil companies were violating the FTCA was “not a definitive statement of position [but instead] represent[ed] a threshold de termination that further inquiry [was] warranted and that a complaint should initiat e proceedings.” Id. at 241. The Court then determined that, because the issuanc e of the complaint served only to initiate the proceedings by which a definitive a gency position could become known, the complaint had no legal force or practica l effect that was comparable to the regulation at issue in Abbott Laboratories , 387 U.S. at 151-53 (holding that regulations issued by Commissioner of Food and Drug s were ripe for review because they were definitive, immediately effective , and directly and immediately affected petitioners’ daily business activities). See Standard Oil , 449 U.S. at 241-
43. We think the posture of the MMS letter is strikingl y similar to that of the FTC complaint in Standard Oil . Rather than consummating any agency decisionmaking process, the letter merely asked OXYto keep its records for the-12-

audit period, requested access to all documents andinformation in OXY’s possession relating to crude oil production and dis position for the audit period, and notified OXY that the MMS intended to initiate an audit. At best, the letter served only to initiate further proceedings by whic h the MMS could determine whether Plaintiffs owed royalties. For this reason , we agree with the district court that the letter represents a tentative or int erlocutory action. Plaintiffs’ claim that the letter was final agency action because it initiated the audit does not change our analysis. Even assum ing that the MMS made a decision to begin the audit process, Standard Oil makes clear that not every decision made by an agency qualifies as the type of decisionmaking which is evaluated for ripeness purposes. See id. at 241-42. Thus, even if the letter did initiate an audit, it still did not consummate the type of decisionmaking process envisioned by the Supreme Court in Abbott Laborator ies and Standard Oil as final agency action. Circuit courts interpreting the Sup reme Court standards have not found agency decisionmaking processes similar to th e action taken in this case to be final. See Veldhoen , 35 F.3d at 225 (stating that, in a case involving a marine casualty reporting and investigation, “[a]n agency’ s initiation of an investigation does not constitute final agency action”); CEC Ener gy Co. v. Public Serv.
Comm’n , 891 F.2d 1107, 1110 (3d Cir. 1989) (concluding th at agency’s determination that it had jurisdiction to investigate a public utility contract was-13-

not definitive but was merely a determination to co mmence an investigation); Aluminum Co. of Am. v. United States , 790 F.2d 938, 941 (D.C. Cir. 1986) (“It is firmly established that agency action is not final merely because it has the effect of requiring a party to participate in an agency pr oceeding.”). Under FOGRMA, we think such definitive decisionmaking processes w ould include, for example, enforcing an order or subpoena for records or determining royalties owed as a result of an audit and requiring OXY to pay such ro yalties, neither of which occurred in the MMS letter here. See 30 U.S.C. § 1711(a) (indicating that primary duties under FOGRMA are to determine royalt ies and other payments owed and to collect and account for such amounts ina timely manner). We therefore hold that the letter constituted no more than “a threshold determination that further inquiry [in the form of an audit was] warranted.” Standard Oil , 449
U.S. at 241. Because we have determined that the MMS’ July 1996 letter to OXY was not the consummation of the agency’s decisionmaking process, we need not analyze the second prong of the finality determinat ion which asks whether the letter imposes legal obligations or consequences onPlaintiffs. See Bennett , 520 U.S. at 177 (stating that the “two conditions must be satisfied for agency action to be ‘final’”). Thus, we hold that the MMS letter to OXY did not constitute final agency action.4 In this case, Defendants may refile an enforcement action in the

appropriate federal court to compel compliance beca use the prior action filed in the Central District of California was dismissed wi thout prejudice.

5 It is worth noting that Plaintiffs also have succes sfully availed themselves (continued...) -14- Although our analysis with respect to the document request letter would normally end here because Plaintiffs cannot satisfyboth prongs of the finality test under Bennett , we will briefly address Plaintiffs’ argument thattheir claims are reviewable because there is no other adequate remedy under the APA. We believe Plaintiffs’ reasoning is flawed. Simply put, the c ourse of events in this case indicates that Plaintiffs already have pursued the remedy available to them, i.e., they refused to provide Defendants with the information requested in the MMS letter. In response to Plaintiffs’ refusal to meetthe letter’s requests, Defendants issued an administrative subpoena under 30 U.S.C. § 1717 to legally force Plaintiffs to provide the requested information. Arequest for information followed by a subpoena is exactly the procedure aut horized by 30 U.S.C. §§ 1713(a) and 1717(a). Subpoena recipients may th en obtain judicial review by simply refusing to comply with the subpoenas and fo rcing the MMS to bring subpoena enforcement actions. 4 See 30 U.S.C. § 1717(b). Should Defendants file a proper enforcement action, we think the law provi des Plaintiffs with every opportunity to contest the validity of the underlyi ng audit and of the document request letter as they pertain to the enforcement o f the administrative subpoena. 55 (...continued)

of their legal remedy of challenging the audit by c ontesting administrative orders to pay royalties that had been issued by the MMS. See OXY USA, Inc. v. Babbitt , No. 96-C-1067-K, 1997 WL 910381 (N.D. Okla. Sept. 23, 1997). -15- See Belle Fourche Pipeline Co. v. United States , 751 F.2d 332, 334 (10th Cir. 1984) (interpreting Reisman v. Caplin , 375 U.S. 440, 449 (1964), for the proposition that an adequate legal remedy exists be cause the investigated party may challenge the validity of the subpoena on any appropriate ground in a subsequent enforcement hearing), cert. denied , 474 U.S. 818 (1985). In summary, Plaintiffs not only have pursued the pr oper procedure and remedies available under FOGRMA by refusing to comp ly with the document request letter and with the subsequent subpoena butthey also possess additional opportunities to assert their rights and arguments in an enforcement action, should Defendants file one. Accordingly, we conclude thatFOGRMA provided Plaintiffs with an adequate legal remedy or remedies under the APA, and we reiterate our holding that the MMS letter to OXY did not constitute final agency action.

2. Administrative Subpoena Although the Bennettframework applies in theory to an evaluation of th e finality of an administrative subpoena, courts are generally guided first by the principle against pre-enforcement review when a party seeks injunctive relief6 In connection with any hearings, inquiry, investigation, or audit conducted

under the auspices of the FOGRMA, the Secretary of the Interior is authorized “to require by subpena [sic] the attendance and testimo ny of witnesses and the production of all . . . documents . . . , as the Se cretary may request.” 30 U.S.C. § 1717(a)(3). In the event of a refusal to obey a subpoena and “upon application of the Attorney General at the request of the Secre tary and after notice to” the person refusing to obey, the statute grants jurisdi ction to any district court of the United States in which the person is found, resides , or transacts business to compel compliance with the subpoena. Id. § 1717(b). -16- from an agency subpoena: “Where an agency must res ort to judicial enforcement of its subpoenas, courts generally dismiss anticipatory actions filed by parties challenging such subpoenas as not being ripe for re view because of the availability of an adequate remedy at law if, and w hen, the agency files an enforcement action.” In re Ramirez , 905 F.2d 97, 98 (5th Cir. 1990) (citing cases suggesting that party wishing to challenge enforceability of administrative subpoena should refuse to comply with subpoena and await enforcement action by issuing agency). Because administrative subpoenas issued by the MMS pursuant to 30 U.S.C. § 1717 are not self-executing, 6 to enforce subpoenas, the agency “must seek an order from a federal district court c ompelling compliance with . . . [them].” Belle Fourche , 751 F.2d at 334; see 30 U.S.C. § 1717(b). Mindful of this principle, we proceed to Plaintiffs ’ argument that the district court erred in characterizing their action as an anticipatory challenge. They assert that review of their claims for injunct ive relief would not be “preenforcement” review because the MMS already has eff ectively enforced the-17-

subpoena by filing an enforcement action in a Calif ornia federal court and by issuing Plaintiffs orders to pay royalties. Plaint iffs also contend that the court erred in concluding that under § 1717(b) an enforce ment action initiated in the Central District of California did not confer juris diction on its own court, i.e., the Northern District of Oklahoma. They contend that t his narrow interpretation improperly allows the MMS to forum-shop in enforcin g its subpoenas. We think the statutory language of 30 U.S.C. § 1717 speaks for itself. The statute clearly indicates that the district court o nly has jurisdiction to enforce a subpoena “upon application of the Attorney General at the request of the Secretary,” 30 U.S.C. § 1717(b), assuming that gene ral requirements of venue and jurisdiction are satisfied. This language succinct ly implies that only the district

court in which the action is filed has jurisdiction over that action. A review of the legislative history confirms that the choice of whe re to file an enforcement action belongs to the Secretary of the Interior. To this effect, the committee reports reveal that Congress “intended that the Secretary h ave broad enforcement authority relating to his royalty and lease managem ent functions.” See H.R. REP
. N O . 97-859, at 32 (1982), reprinted in1982 U.S.C.C.A.N. 4268, 4286; see also Phillips Petroleum Co. v. Lujan , 951 F.2d 257, 260 (10th Cir. 1991) (Phillips I ) (indicating that “administrative agencies vested wi th investigative power,” such as the Department of the Interior, “have broad disc retion to require the disclosure-18-

of information concerning matters within their juri sdiction”). Thus, we agree with the district court that the MMS is authorized to choose when and where to file an enforcement action, subject to constraints imposed by reasonableness and the usual jurisdictional requirements. Because the MMS did not file an enforcement action in the Northern District of Oklahoma, the court correctly concluded that it did not have jurisdiction to asce rtain the validity of the subpoena. Further, as we concluded above, Plaintiffs’ argument that they have no alternative adequate remedy is without merit. Plai ntiffs pursued the remedy available under 30 U.S.C. § 1717 by refusing to pro duce the subpoenaed documents and thereby forcing Defendants to file anenforcement action to compel compliance with the subpoena. See 30 U.S.C. § 1717(b). Thus, judicial review is available to Plaintiffs if and when Defen dants refile an enforcement action in the appropriate federal district court. We therefore hold that Plaintiffs “possess[] an adequate legal remedy and [are] not e xposed to the type of immediate . . . injury necessary to justify jurisdi ction.” Belle Fourche , 751 F.2d
at 335. In light of our conclusion that the district court properly determined that it did not have jurisdiction to address an anticipatory challenge to the subpoena, we reject Plaintiffs’ remaining arguments that the sub poena consummated the agency-19-

decisionmaking process and imposed legal obligation s which would make it ripe for review and that Defendants’ California enforcem ent action and orders to pay are essentially a counterclaim which supplies the c ourt with an independent ground for jurisdiction. We now turn to Plaintiffs ’ argument that their claims are ripe because final agency action is not needed in t his case.

3. Exception to the Requirement of Finality Plaintiffs argue that the district court may exerci se jurisdiction under Leedom v. Kyne , 358 U.S. 184 (1958), because the MMS exceeded its statutory authority by initiating the audit, requiring Plaint iffs to maintain records beyond the six-year period specified in 30 U.S.C. § 1713(b ), and subpoenaing records more than six years old. In Kyne , the Supreme Court held that the federal district court had jurisdiction to review a National Labor R elations Board action despite a statutory provision intended to preclude such revie w because the agency had acted “in excess of its delegated powers and contrary to a specific prohibition in the [National Labor Relations] Act.” Kyne , 358 U.S. at 188. “In considering whether to proceed under Kyne , courts have emphasized that the case provides an exception of ‘very limited scope,’ to be ‘invoked o nly in exceptional circumstances.’” United States Dep’t of Interior v . FLRA , 1 F.3d 1059, 1061 (10th Cir. 1993) (citations omitted); see also Boire v. Greyhound Corp. , 376 U.S.-20-

473, 481 (1964) (“The Kyne exception is a narrow one.”). According to this court’s interpretation of Kyne , agency action will only fall within the exception c reated by Kyne when the agency’s determination is “made in excess of its powers,” when the agency “disobeyed the express command of [ its organic act] . . . and in doing so . . . acted in excess of its powers,” when the agency order is “an attempted exercise of power that had been specifically withheld,” and when it is “agency acti on taken in excess of delegated powers.” United States Dep’t of Interior , 1 F.3d at 1061 (quoting Kyne , 385 U.S. at 185, 186-87, 189, 190). Plaintiffs claim that Kyne applies here because the challenged subpoena was issued solely for purposes of an audit which Pl aintiffs allege is in contravention of statutory limits on the agency’s a uthority. Specifically, they assert that under Phillips Petroleum Co. v. Lujan , 4 F.3d 858 (10th Cir. 1993) (Phillips III ), the audits and subpoenas are illegal because the MMS is barred from initiating an audit and requesting records mor e than six years old. Plaintiffs contend that Phillips III stands for the proposition that an audit begun mor e than six years after the relevant records were generated is per se unlawful. To support their argument, they rely on the court’s statement in Phillips III that “it is clear that if the government fails to initiate an audit w ithin six years after the records were generated, the delay is per se unreasonable.” Id. at 864. Reading this language in the context within which it was stated and in conjunction with the-21-

holdings of Phillips I and Phillips III , we think Plaintiffs’ assertion is wide of the mark. First, this language is dictum. It was not directl y related to the facts or the holding of the case, and it was simply intended to guide the district court’s determination on remand. The critical question in Phillips III was when a cause of action to recover unpaid royalties should accrue under 28 U.S.C. § 2415(a).
See id. at 859. Answering this question, the court held that the government’s right of action under 28 U.S.C. § 2415(a) accrues “ on the date the contract was breached, which was the date the royalties were due and payable.” Id. at 861. In response to the government’s claim that the statute of limitations was tolled under 28 U.S.C. § 2416(c) until the government completed its audit, the court held that the statute of limitations would be tolled until co mpletion of an audit only if “facts material to the right of action [were] not k nown and reasonably could not be known without the audit, and [if] the audit was completed within a reasonable time after the deficient royalty payment.” Id. at 863 (internal quotation marks omitted). The Phillips III court reversed the district court’s decision barri ng the government’s claims and remanded for an evidentiaryhearing on the tolling question to determine whether the government knew o r reasonably should have known about the allegedly deficient royalty payment . See id. With respect to the remand order, the court then advised the district c ourt to consider FOGRMA in-22-

making its determination. In this limited scope, t he court warned that “if the government fails to initiate an audit within six ye ars after the records were generated,” id. at 864, then the government’s delay will not invok e the tolling of the six-year statute of limitations to pursue an action to collect unpaid royalties under 28 U.S.C. § 2415. See id. at 864. Conversely, Phillips III did notsay that a six-year delay would prohibit the MMS from requir ing a lessee to retain documents or to disclose documents beyond the six-y ear period required in 30 U.S.C. § 1713(b) in connection with an audit

. Our clarification of Phillips III is supported by the language of § 1713(b). This section of FOGRMA specifically authorizes the Secretary to order a lessee to maintain documents “for a [period] longer” than the mandatory six years. 30 U.S.C. § 1713(b). Additionally, this court’s de cision in Phillips I ratifies Defendants’ contention that the MMS has the authori ty to seek and require Plaintiffs to retain and disclose documents more th an six years old which were voluntarily maintained by Plaintiffs prior to the a udit. Phillips I specifically addressed whether the Secretary of th e Interior and the MMS had the authority to order an oil and gas l essee to provide eight-yearold records in connection with an audit. See Phillips I , 951 F.2d at 259-60. The court clearly held that the defendants possessed th at authority. Reversing the district court’s grant of summary judgment to the p laintiff-lessee, the court-23-

determined that neither the six-year record-keeping requirement of 30 U.S.C. § 1713(b) nor the six-year statute of limitations o n actions to collect royalty payments under 28 U.S.C. § 2415 precludes the MMS f rom seeking, and the lessee from disclosing, information that is more th an six years old. See id. at 260-61. The court also stated that “[a]dministrati ve agencies vested with investigatory power have broad discretion to requir e the disclosure of information concerning matters within their jurisdiction,” id. at 260, and that the “[d]efendants’ investigatory power is their power to audit records maintained by [oil and gas] lessees.” Id. at 260 n.6. Phillips I further noted that “by giving the Secretary the authority to unilaterally extend the period for retaining records, Congress has recognized that [§ 1713(b)’s] six-yearlimitation is not absolute.” Id. at 260 n.5. Consequently, we think that the mention in Phillips III of a “per se unreasonable delay” related only to the court’s adv ice to the district court concerning the tolling of the six-year statute of l imitations under 28 U.S.C. § 2415 in an action to recover unpaid royalties. W hile this case does not require us to decide whether Defendants have imposed upon P laintiffs the obligation to retain their records for more than six years, it is plain under Phillips I that even if Defendants had imposed such an obligation they woul d not have contravened their statutory mandate. Because “‘this dispute is over the agency’s interpretation of-24-

its statute and the regulations, an activity to whi ch courts generally grant deference to agencies,’” Appellants’ App., Vol. II, Doc. 23 at 915 (quoting Veldhoen , 35 F.3d at 226), and because the MMS has not “act ed in excess of its powers,” Kyne , 358 U.S. at 187, we hold that the case before us does not present the type of extraordinary circumstances necessary t o invoke the narrow exception established in Kyne . “An attack on the authority of an agency to cond uct an investigation does not obviate the final agency act ion requirement.” Veldhoen , 35 F.3d at 225.

B. Direct and Immediate Impact Turning to the third ripeness consideration, neithe r the document request letter nor the administrative subpoena has an appre ciable direct and immediate impact upon Plaintiffs. While the second prong of the Bennettfinality analysis generally requires the court to examine whether anylegal consequences arise from the agency action, the approach to the third p rong of the ripeness doctrine is a broader one, focusing on financial and operationa l impacts as well as on legal ones. We begin by comparing the effects of the letter and the subpoena on Plaintiffs with the effects of the obligations impo sed on the petitioner in the seminal case on this point, namely, Abbott Laborato ries . In that case, the petitioner was forced to choose between costly comp liance with food and drug7 If Defendants were to file a proper enforcement act ion to obtain the

subpoenaed information, Plaintiffs likely could mor e readily show the type of effects which Abbott Laboratories envisioned. However, while we think the distinction between pre- and post-enforcement impac ts is an important one, we do not answer today whether post-enforcement impacts w ould in fact satisfy the Abbott Laboratories standard. -25- regulations and severe criminal and civil penalties for noncompliance. In determining that the petitioner’s claims were ripe, the Court found that the required changes in products and the costs associat ed with ensuring compliance and preventing civil and criminal prosecution for n oncompliance constituted direct and immediate impacts on petitioner’s daily business. See Abbott Lab. , 387 U.S. at 152-53. The document request letter and subpoena have no im mediate substantial impact upon Plaintiffs similar to the burdens descr ibed in Abbott Laboratories

. Plaintiffs’ refusal to comply with the document req uest letter itself evidences the letter’s lack of impact. The letter did not force Plaintiffs to disclose any information; it merely requested that they cooperat e with the investigation. Even after the MMS served Plaintiffs with an administrat ive subpoena, Plaintiffs still did not suffer any immediate or substantial effect for refusing to comply with it. 7 Any “consequences” Plaintiffs claim to have suffere d or to be suffering as a result of their procedural wrangling with Defendants do no t constitute direct and immediate impacts because they do not impose any ap preciable obligations upon-26-

their daily business. See CEC Energy , 891 F.2d at 1110-11 (stating that agency’s action determining jurisdiction only imposed obligation to respond to agency’s further inquiries); cf. Standard Oil , 449 U.S. at 243 (determining that agency’s issuance of complaint had no impact “other than the disruptions that accompany any major litigation”). Further, we do not think Plaintiffs’ alleged burdenof having to retain information more than six years old is the type of consequence which, standing alone, creates ripeness. Not only does this type o f burden arise from every audit requiring records to “be maintained for a [period] longer” than six years, 30 U.S.C. § 1717(b), but, like the obligation of havin g to disclose documents, merely being required to retain information does not impos e the type of costs or the potential for severe criminal penalties recognized in Abbott Laboratories

. Additionally, because the MMS has avowed not to pur sue penalties against Plaintiffs under 30 U.S.C. § 1719(c)(2), there is n o merit to Plaintiffs’ argument that such penalties would have a substantial and se vere impact upon them. For these reasons, we are not persuaded that the docume nt request letter and the administrative subpoena expose Plaintiffs to the type of direct and immediate “injury necessary to justify jurisdiction.” Belle Fourche , 751 F.3d at 335.

C. Agency Enforcement and Administration-27-

The fourth and final factor in the ripeness analysi s asks whether the resolution of the issues will promote effective enf orcement and administration by the agency. We agree with the Government’s assessm ent that judicial review of the MMS letter, which we have concluded does not co nstitute final agency action, would cause substantial disruption to the administr ative process. See Appellees’ Br. at 18. As noted above, Plaintiffs’ allegation of harm–that they are illegally forced to retain records for a period beyond the si x-year period stated in 30 U.S.C. § 1713(b)–is the type of obligation which ac companies many audits and investigations under FOGRMA. If such an allegationof harm was sufficient to justify review of an agency’s decision to initiate an audit and request documents, “courts would constantly be reviewing such decision s,” CEC Energy , 891 F.2d at 1111, and the MMS’ ability to conduct audits would be unreasonably hampered. Cf. Abbott Lab. , 387 U.S. at 148 (noting that ripeness doctrine is intended to prevent courts from unnecessarily intervening in ad ministrative decisionmaking). Additionally, because further agency action is need ed to enforce the administrative subpoena, we think that any action b y the courts at this stage would impede the agency’s ability to pursue the pre scribed administrative
processes.

IV.-28-

In conclusion, we hold that neither the document re quest letter nor the administrative subpoena is ripe for review. We the refore AFFIRM the district court’s grant of summary judgment to Defendants forlack of subject matter jurisdiction.