1 

# In the United States Court of Federal Claims

No. 11

- 543L (Filed: May 30 , 2013)

* * * * * * * * * * * * * * * * * * * * * * * * * * * *

* LONE STAR INDUSTRIES, INC., *

* Plaintiff, *

*

v. *

*

THE UNITED STATES

, *

*

Defendant. *

*

* * * * * * * * * * * * * * * * * * * * * * ** * * * *

David M. Flotte

, Edward F. Kohnke , and Joseph E. Lee III , Preis & Roy, PLC, 601 Poydras Str eet, Suite 1700, New Orleans, LA , 70130, for Plaintiff. D avid S. Rifkind, Lone Star Industries, Inc., of Counsel.

Ignacia S. Moreno and Charlotte M. Youngblood , United States Department of Justice, Environment & Natural Resources Division, 601 D Street, NW, Washington, D.C., 20004, for Defendant. David R. Dy er and Jennifer Labourdette Burck , United States Army Corps of Engineers, of Counsel.

___________________________________________________________________________

MEMORANDUM OPINION AND ORDER DENYING MOTION FOR NEW TRIAL

OR ALTERNATIVELY TO ALTER OR A MEND THE JUDGMENT

___________________________________________________________________________

WILLIAMS , J udge

.

This Fifth Amendment takings case comes before the Court on Plaintiff’s motion for

new trial , or alternatively

, to alter or amen d the judgm ent i n Lone Star Industries v. United

States

, 109 Fed. Cl. 746 (2013)

. Lone Star Industries, Inc. (“Lone Star” ) contends that the

Court erred in its application of Rule 12(b)(6), the navigational servitude

, and Louisiana law.

B ecause the Court finds no c ircumstances that warran t reconsideration under Rule 59 or Rule

60

, Plaintiff ’ s motion is DENIED

.

Background

Lone Star, a cement importer, owns a deep

- draft terminal abutting the Michoud Ca nal

in New Orleans, Louisiana. Plaintiff filed a compla int in this Court alleging that the 2009 United States Court of

Federal Claims Rule s 12(b )(6), 59, 60; Motion for

New Tria l or to Alter or

Amen d Judgment; Fifth

Amendment Taking; L A

. C IV

. C ODE A NN

. art. 690, et

seq.; Property Interest;

Predial Servitude

.2 closure of the Mississippi River Gulf Outlet (“MRGO”) e ffected a taking of deep

- draft

access to its prope rty

, asserting its right to perpetual deep

- draft vessel access to 36 feet

. O n February 27, 2013, this Court d ismissed t his action ruling:

Plaintiff has failed to allege a compensable property interest in deep

- draft access to its property under Louisiana or Federal Law. Plaintiff has likewise failed to allege that its facilities or operations were directly regul ated by the Government’s closure of the MRGO. As such, Plaintiff has failed to allege facts giving rise to a plausible physical or regulatory takings claim.

Lone S tar , 109 Fed. Cl. at 759

.

In its motion for reconsideration

, Plaintiff alleges that th is Court erred in granting the

G overnmen t’s 12(b)(6) motion to dismiss by failing to accept Plaintiff ’ s allegations. In addition, Plaintiff claims the Court improperly relied on a navigational servitude defense and misapplied Louisiana law.

Discussion

Rule 59

Rule 59 of the Rules of the United States Court of Federal Claims (“RCFC”) governs motions for new trials, reconsideration, and altering or amending a judgment. Rule 59(a) provides :

(1) Grounds for New Trial or Reconsideration.

The court may, on motion, gra nt a new trial or a motion for reconsideration

on all or some of the issues

– and to any party

– as follows:

(A) for any reason for which a new trial has heretofore been granted in an action at law in federal court; (B) for any reason for which a rehearing has hereto fore been granted in a suit in equity in federal court; or (C) upon the showing of satisfactory evi dence, cumulative or otherwise, that any fraud, wrong, or injustice has been done to the United States.

RCFC 59(a)(1)

. “The decision whether to grant reconside ration lies largely within the

discretion of the district court.” Yuba Natural Res. , Inc. v. United States , 904 F.2d 1577, 1583 (Fed. Cir. 1990). “Reconsideration is not to be construed as an opportunity to relitigate issues already decided.” Dai r yland Power Co op. v. United States , 106 Fed. Cl. 102, 104 (2012) (citing Shell Petrol. , Inc. v. United States , 47 Fe d. Cl. 812, 814 (2000)). To this end

, “[t]he mova nt may not merely recapitulate cases and arguments considered by th[e] court before rendering i ts original decision.” Fru

- Con Constr. Corp. v. United States , 44 Fed. Cl. 298, 301 (1999 ) (internal quotations omitted)

.3 A Rule 59 motion “must be based upon manifest error of law, or mistake of fact, and is not intended to give an unhappy litigant an additional chance to sway the court.” Fru

- Con Constr. Corp. , 44 Fed. Cl. at 300 (quoting Bishop v. United States , 26 Cl. Ct. 281, 286 (1992)) ; see also Froudi v. United States , 22 Cl. Ct. 290, 300 (1991). More precisely, “the moving party must show: ( 1) the occurrence of an intervening change in the controlling law; (2) the availability of previously unavailable evidence; or (3) the necessity of allowing the motion to prevent manifest injustice.” Matthews v. United States , 73 Fed. Cl. 524, 526 (2006) (citing Griswold v. United States , 61 Fed. Cl. 458, 460

- 61 (2004)). Manifest means

“ ‘ clearly a pparent or obvious.’” Martin v. United States , 103 Fed. Cl. 445, 448 (2012) (quoting Ammex, Inc. v. United States , 52 Fed. Cl. 555, 557 (2002) ) . M anifest in just ice

“ ‘ refers to injustice that is apparent to the point of almost being indisputable. ’ ” Id. (quoting

Pac. Gas & Elec. Co. v. United States , 74 Fed. Cl. 779, 785 (2006), rev’d in part on other grounds , 536 F.3d 1282 (Fed. Cir. 2008)).

R ule 59 imposes ex acting standards designed to prevent parties from attempting

“extensive re

- trial based on evidence which was manifestly available at the time of the hearing.” Seldovia Native Ass’n v. United States , 36 Fed. Cl. 593, 594 (1996) (internal quotations omitted ).

Rule 60

Rule 60 governs relief from a judgment or order, and Rule 60 (b) states:

(b) Grounds for Relief from a Final Judgment, Order or Proceeding

.

On motion and just terms, the court may relieve a party or its legal representative from a final judgment, order, or proceeding for the following

reasons:

(1) mistake, inadvertence, surprise, or excusable neglect; (2) newly discovered evidence that, with reasonable diligence, could

not have been discovered in time to move for a new trial under RCFC 59(b); (3) fr aud (whether previously called intrinsic or extrinsic), misrepresentation, or misconduct by an opposing party; (4) the judgment is void; (5) the judgment has been satisfied, released, or discharged; it is based on an earlier judgment that has been reversed or vaca ted; or applying it prospectively is no longer equitable; or (6) any other reason that justifies relief.

RCFC 60 (b). Rule 60(b) is intended “ ‘ to grant a party relief from a judgment [or order] in circumstances in which the need for truth outweighs the valu e of finality in litigation. ’ ”4 Webster v. United States , 93 Fed. Cl. 676, 678

- 79 (2010) (quoting 12 J AMES W M

. M OORE et
al

. , M OORE ’ S F EDERAL P RACTICE § 60.02[2] (3d ed. 2004) ) (alteration in original) ; see also Madison Servs., Inc. v. United States , 94 Fed. C l. 501, 506 (2010) ( “[I]t should be noted that relief from judgment pursuant to Rule 60(b) is an extraordinary remedy only to be granted in exceptional circumstances.”)

. “ In order to grant relief under these provisions, the court must find that a ‘grave miscar riage of justice’ wo uld result if relief is denied.” Kennedy v. Sec’y

of Health & Human Servs. , 99 Fed. Cl. 535, 540 (2011) (quoting United States v. Beggerly

, 524 U.S. 38, 47 (1998))

. Relief under Rule 60(b) is discretionary, “ and the court may weigh equitable considerations in the exercise of its discretion. Nonethele ss, relief from judgment

under Rule 60(b) will not be given if substantial rights of the party have not been harmed by the judgment.” Dynacs Eng ’g Co. v. United States , 48 Fed. Cl. 240, 241

- 42 (2000) (internal

citation omitted).

T he Court’s Application of Ru le 12(b)(6)

Plaintiff contends that the Court erred in “refus [ ing ] to accept” its allegations that it

has a property interest in su fficient access to its facility and that the Government’s closure of

the MRGO has denied it that access. Pl.’s Mot. for N ew Trial 7

- 8

. The existence of a cognizable property interest is an issue of law. Natale v. Town of Ridgefield , 170 F.3d 258, 263 (2d Cir. 1999) (finding that “[i]n almost all cases, the ex istence of a federally protectable

propert y right is an issue of law for the court.”); see also Munno v. Town of Orangetown

, 391 F. Supp. 2d 263, 269

- 70 (S.D.N.Y. 2005) (noting that the issue of whether suspension without pay is a cognizable Fourteenth Amendment property interest is an issue of law); Dixon v. Mayor of W ilmington , 514 F. Supp. 250, 253 (D. Del. 1981) (“The issue of law in this case involves the murky area of alleged property interests

. . . .”). As such, the Court was not obligated to accept Plaintiff’s allegations of a right to sufficient access to its f acility in determining whether to dismiss this action under Rule 12(b)(6).

A federal court evaluating a motion to dismiss must accept all factual allegations as

true but is not obliged “to accept as true a legal conclusion couched as a factual alleg ation

. ” Papasan v. Allain , 478 U.S. 265, 286 (1986); see also Bell Atl. Corp. v. Twombley , 550 U.S. 544, 555 (2007). “Such bare assertions, which do no more than state legal conclusions, are not entitled to be assumed true,” but rather “are disentitle[d] ... to the presumption of truth even if cast in the form of a factual allegation.” Dobyns v. United States , 91 Fed. Cl. 412, 423 (2010) (quoting Ashcroft v. Iqbal , 556 U.S. 662, 681 (2009)) (internal quotations omitted); see also Extreme Coatings, Inc. v . United States , 109 Fed. Cl. 450, 454 (2013) (“Under Twombly and Iqbal , the court must not mistake legal conclusions presented in a complaint for factual allegations which are entitled to favorable inferences.”); Red Hawk Constr., Inc. v. United States , 1 08 Fed. Cl. 779, 787 (2013) (noting that this Court may disregard unsupported conclusions of law when deciding Rule 12(b) motions).

Lone Star had ample o pportunity to ide nti fy a cognizable proper ty interest that would support its Fifth Amendment takings claim

. On November 28, 2011 , t he Government filed a

motion to dismiss Plaintif f’s complaint fo r failure to demonstrate a legally protected property
i nterest that would support a takings claim

. T he Court denied this motion on June 19, 2012,5 and granted P laintiff leav e to file an amended complaint. The Court ordered :

In its amended complaint, Plaintiff shall:

a) Articulate the compensable property interest that it is asserting in its takings claim;

b) Clarify the legal parameters of its takings claim;

c) Cla rify whether in addition to its Fifth Amendment claim, it is asserting a separate and distinct claim alleging a violation of the Water Resources Development Act of 2007, including whether that Act is money

- mandating;

d) Identify what governmental actions en ticed Plaintiff to invest in improvements of almost $64.5 million;

e) Identify what governmental actions led Plaintiff to conclude that the MRGO would remain a deep

- draft navigation outlet; and

f) Clarify its allegations and any claim regarding the IHNC Lock.

Lone Star Indus., Inc. v. United States

, No. 11

- 543C, 2012 WL 2331410, at *3

- 4 (Fed. Cl. June 19, 2012)

. The Court further instructed that “ [t]hese questions about Plaintiff’s claim should be taken as illustrative, not exhaustive

-- Plaintiff should clarify and amend its complaint as it deems appropriate.” Id. at *4 n.4.

In its amended complaint Plaintiff alleged a property interest in the real estate and improvements at its facility and “an accessory right of deep

- draft vessel access to the property under state and federal laws.” Am. Compl. ¶ 30. Plaintiff cited Louisiana law s on

pr edial servitudes and fe deral Public Law 455 in support of this right

. However, Plaint iff

failed to articulate how these state and federal law s create d a Fifth Amendment property right to deep

- draft access at its facility. As this Court determined:

Here, Lone Star alleges that the Government’s closure of the MRGO “has taken away ‘all economically beneficial use’ of certain improvements at Lone Star’s Michoud Canal facility and a ‘non

- categorical’ taking of other asset groups.” Pl.’s Opp’n 26; see also Am

. Compl. ¶ 29. Importantly, however, Lone Star has not plausibly alleged that the ability to use its property as a deep

- draft vessel terminal is a right that inheres in its title to that property. Thus, Plaintiff has not alleged facts indicating that its ownership of this facility located on the Michoud Canal just north of the Canal’s intersection with the MRGO carried with it the perpetual right to deep

- draft access via the MRGO to its facility.6 Lone Star , 109 Fed. Cl. at 759

.

Plaintiff also alleged a “compensable property interest in . . . real estate and improvements including doc ks, mills, ship unloaders, pipe s, buildings, silos, and other equipment.” Am. Compl. ¶ 29. Lone Star contended that the Government’s closure of the

MR GO “has taken away ‘all economically beneficial use ’ of certain improvements at Lone Star’s Michoud Canal facility and a ‘non

- categorical’ taking of other asset groups .” Pl.’s Opp’n 26. Plaintiff did not clarify what it meant by “ asse t groups,” or how tho se “asset groups” related to the rest of its property at the facility

. Lone Star did not allege that the deep

- draft asset groups on its land comprise the entirety of its property interest, or that the ability to use its property as a deep

- draft facility was within the “bundle of sticks” that it

acqu ired with the title to that property.

Plaintiff now suggests that the Court erred in “refus [ ing ] to accept” that “ [ t ] he improvements [to its facility] are useless because no ships can call and because the assets are too big, heavy and bulky to be moved.” Pl .’s Mot. for New Trial 9; see also Am. Compl. ¶¶

32

- 34. The Court did accept Plaintiff’s factual allegation that its deep

- draft improvements have been rendered useless, but found that Plaintiff failed to alle ge a compensable property interest in the ability to use its property as a deep

- draft vessel terminal. Lone Star , 109 Fed.

Cl. at 754

- 56. I n American Pelagi c Fishing Co. v. United States , 379 F.3d 1363 ( Fed. Cir. 2004), the Federal Circuit found no cogni zable property interest in the plaintiff’s ability to

use the Atlantic Star deep

- sea fishing vessel to fish in the Exclusive Economic Zon e (“EEZ”)

of the Atlantic Ocean. Although the court acknowledged that the Government’s denial of permits to fish in th e EEZ rendered the Atlantic Star useless , it declined to find a taking because the plaintiff’s property rights were circ umscribed by the United States ’ declaration of sovereignty over the EEZ fishing industry

. Id. at 1378

- 81. Similarly, in Air Pegasus of D.C., Inc. v. United States

, 424 F.3d 1206 (Fed. Cir. 2005), the Federal Circuit recognized that the regulation of the airspace over t he plaintiff’s Washington, D.C. heliport business

ren dered that business useless, bu t found that the plaintiff failed to demonstrate that it had a cognizable property interest in the public airspace above its property. Id. at 1219

- 20.

In the absence of allegations t hat support a right of deep

- draft access to its facility or that demonstrate how Plaintiff ’ s facilities or operations have been directly regulated , this

Co urt found Plaintiff’s situation analogous to that of the Atlantic Star owner in American Pelagic and the h eliport operator in Air Pegasus

. Wh en the Government closed the MRGO

, a public waterway, Lone Star suffered an indirect loss of its ability to maintain a deep

- draft facility which can only be considered an economic conseq uence of the closing and not an invasion of a property right. See Air Pegasus of D.C ., Inc. , 424 F.3d at 1215 (“Air Pegasus’s takings claim [for the inability to use its heliport to receive helicopters] was really for compensation resulting from a derivative injury. . . . This circumstance does not form the basis for a viable takings clai m.”) (internal quotations omitted )

. Indeed, “[t] he failure to establish a right to a particular use renders a takings claim based on that right ‘fatally

defective.’” Lone Star

, 109 Fed. Cl. at 758

- 59 (quoting Am. Pelagic Fishing Co. , 379 F.3d at 1383)

. As such, reconsideration on the basis tha t the Court failed to accept Plaintiff’s7 allegations is not warranted.

T he Navigation al Servitude

Plaintiff further submits that “the Court relied upon a navigatio nal servitude defense”

in reac hing its decision, and that the Court “misapplied the navigational servitud e.” Pl.’s Mot. for New Trial 1, 3. The Court stated that even if Plaintiff had been able to establish a property interest to support its takings claim, any such interest would hav e be en subsumed by the navigational servitude. Lone Star

, 109 Fed. Cl. at 757

- 58

. The Court reason ed:

[b] ecause the [Water Resources Development Act] specifies Congress’ navigational purpose in the development and alteration of waterways around

the co untry, the de

- authorization of the MRGO [pursuant to the Water Resources Development Act] occurred in the Government’s exercise of the navigational servitude. . . . The Government’s navigational servitude as expressed in the WRDA prevents Lone Star from st ating a plausible claim that the closure of the MRGO effected a taking of its property interest in deep

draft access.

Id. A s noted by the Government, Plaintiff cited “ no controlling case with a holding contrary to this Court’s interpretation of the fed eral navigational servitude, and no intervening change in law that would warrant new analysis.” Def.’s Resp. to Pl.’s Mot. for New Tria l 9. As such, Plaintiff has not articulated any ground for reconsidering this aspect of the decision. In any event, th e Court’s application of the navigational servitude defense was an alternative ground for dismissal because , as the Court he ld, there could be n o Fifth Amendment taking given that Plaintiff failed to allege facts giving rise to a compensable property interest in

d eep

- draft access to its property under Louis iana or Federal Law, and “failed to allege that its facilities or operations were directly regulated by the Government’s closure of the MRGO.”

Lone Star

, 109 Fed. Cl. at 759

.

Louisiana La w o n Predial Servitud es

Plaintiff asserts that the Court has “misapplied the Louisiana law pert aining to predial

servitudes ” by considering whether Plaintiff’s estate is enclosed within the meaning of Louisiana law before determining whether a servitude of passage exists . P l.’s Mot. for New

Trial 10. Plaintiff contends that the existence of a servitude of passage depends on the sufficiency of access as determined by the needs of the estate and that the Court did not properly consider the sufficiency of Lone Star’s deep

- wate r access. Id. Plaintiff states that it has alleged sufficient facts to show that the available access is insufficient for a deepwater port, and that such allegations preclude a Rule 12(b)(6) dismissal. Id. at 11. The Court

ac cepted Plaintiff’s conten tion that it has insufficient deep

- draft access to its facility. However, the Court found tha t Plaintiff failed to allege a plausible claim that Louisiana law provided a property right to deep

- draft access.8 Lone Star alleged that “ Lou isiana Civil Code Article 689 p rovides a right of passage

– a ‘predial servitude’ in Louisiana parlance

– to the owners of enclosed estates.” Pl.’s Opp’n 16. Lone Star’s position was that “instead of losing a preferred access point . . . Lone

Star has no access point by which deep

- draft ships can reach its ship

- sized assets . . . .” Id. at
17. That is, by cutting off deep

- draft access to its facility, the Government’s closure of the

MRGO has render ed the property an “enclosed estate ” with respect to dee p

- draft shipping

activities. See id

. at 16

- 17. Under Louisiana law, a n enclosed estate “that has no access to a public road or utility may claim a right of passage over neighboring property to the nearest public road or u tility.” L A

. C IV

. C O DE A NN

. art. 689 (2012 ). “ T he right of passage for the

benefit of an enclosed estate sha ll be suitable for the kind of traffic or utility that is reasonably necessary for the use of that estate.” L A

. C IV

. C O DE A NN

. art. 690 (2012 )

. While

Plaintiff submitted that the Court should consider the needs of its estate in determining enclosure, the clear import of these statutes is that a property that has access to a public road

is not enclosed. L A

. C IV

. C O DE A NN

. art. 689 (2012) ; L A

. C IV

. C O DE A NN

. art. 690 (2012) ;

s ee also LeBlanc v. Thibodeaux , 61 5 So. 2d 295, 298 (La. 1993) (“ Civil Code Article 689 details the legal right of passage. It allows an owner of an estate that has no access to a public road to claim a right of passage over neighboring property to the nearest public road provided that the owner pays indemnity for the damage he causes.”) (emphasis added) ; Vermi lion Parish Sch. Bd. v. Broussard , 270 So. 2d 523, 524

- 25 (La. 1972) (referring to an enclosed estate as a “landlocked” estate).

Here, “Plaintiff still maintains access to i ts property by public road, railroad, and several other public waterways including the Mississ ippi River and Industrial Canal, Lake

Pontchartrai n, and the Intracoastal Canal.

. . . The only type of access that has been eliminated is the deep

- w ater access necessary to receive deep

- draft shipping vessels.” Lone

Star

, 109 Fed. Cl. at 755

. Pl aintiff acknowledged that it ha s access to several public thoroughfares, and the Court determine d that these code provisions do not provide a right to deep

- draft access to the Plaintiff’s facility. Id.

Conclusion

Plaintiff’s moti on for new trial, or alternatively to alter or amend the judgment is

DENIED

.

s/Mary Ellen Coster Williams

MARY ELLEN COSTER WILLIAMS Judg e