Court Opinion

ID: 4708340
Source: CourtListenerOpinion
Date Created: 2021-08-02 13:02:10.102826+00
Date Added: 2024-06-11T08:06:50.170457
License: Public Domain

In the United States Court of Federal Claims
                                     No. 02-1078L
                                 (Filed July 30, 2021)

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                          *
ERIKA BAILEY-JOHNSON,     *
                          *
               Plaintiff, *
                          *
         v.               *
                          *
THE UNITED STATES,        *
                          *
              Defendant.  *
                          *
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      Daniel J. Cragg, Eckland & Blando LLP, with whom was Lara R. Sandberg,
both of Minneapolis, Minn., for plaintiff.

      Joshua P. Wilson, Natural Resources Section, Environmental and Natural
Resources Division, Department of Justice, with whom was Jean E. Williams,
Acting Assistant Attorney General, both of Washington, D.C., for defendant.

                                       ORDER

WOLSKI, Senior Judge.

      This case was originally brought by Gary Bailey, a property owner who
alleged that the denial of a Clean Water Act (CWA) section 404 permit, under 33
U.S.C. § 1344, and the issuance of a Restoration Order by the Army Corps of
Engineers (the Corps), resulted in a taking of his property without just
compensation, in violation of the Fifth Amendment. See Bailey v. United States, 78
Fed. Cl. 239, 241 (2007). 1 At the time the complaint was filed, Mr. Bailey had
pending in the United States District Court for the District of Minnesota a lawsuit
challenging these same actions of the Corps under the Administrative Procedure

1 After his death, Mr. Bailey’s daughter Erika Bailey-Johnson, his successor in
interest, was substituted as the plaintiff. ECF No. 167. For the sake of
convenience, the Court will use the term “plaintiff” to refer to either individual.
Act, 5 U.S.C. §§ 701–06. See Bailey v. United States Army Corps of Engineers, No.
0:02-cv-00639-RHK-RLE (D. Minn. March 15, 2002), Compl. ¶¶ 19–43 (D. Minn.
Compl.). In that case, Mr. Bailey sought declaratory and injunctive relief against
the Corps, but sought takings damages from state and local government entities.
See D. Minn. Compl. at 14–15.

       When the complaint was filed in our court, the existence of the district court
lawsuit posed no problems for Mr. Bailey under 28 U.S.C. § 1500 (Section 1500),
which bars our court from exercising jurisdiction over certain claims otherwise
within our jurisdiction when the same or related claims were pending in another
court at the time the matter was brought before us. See 28 U.S.C. § 1500. The
Federal Circuit had definitively held that, for an earlier-filed and pending case to
preclude one in our court, “the claim pending in another court must arise from the
same operative facts, and must seek the same relief.” Loveladies Harbor, Inc. v.
United States, 27 F.3d 1545, 1551 (Fed. Cir. 1994) (en banc). But the Supreme
Court subsequently eliminated the “same relief” requirement, holding that “[t]wo
suits are for or in respect to the same claim, precluding jurisdiction in [our court], if
they are based on substantially the same operative facts, regardless of the relief
sought in each suit.” United States v. Tohono O’Odham Nation, 563 U.S. 307, 317
(2011). 2

       Following this doctrinal change, the government moves to dismiss plaintiff ’s
claims under Section 1500, contending that this case is indistinguishable from
Resource Investments, Inc. v. United States, 785 F.3d 660 (Fed. Cir. 2015). U.S.
Mot. to Dismiss (Def.’s Mot.), ECF No. 145, at 2, 5–7. In Resource Investments, the
Federal Circuit affirmed the dismissal of a case alleging that a CWA section 404
permit denial resulted in a taking, applying the “act or contract” test for preclusion.
Res. Invs., 785 F.3d at 666–68. To the extent that the government argues that, for
Section 1500 purposes, it is sufficient that the district court claims involve the same
parties, the same conduct by the government and the same property as this suit, see
Reply in Supp. Def.’s Mot., ECF No. 148, at 1, 4, the Court cannot agree. Although
the decision from our court in Resource Investments found that Section 1500 applied
because claims in both lawsuits involved the same permit denial, see Res. Invs., Inc.
v. United States, 114 Fed. Cl. 639, 650 (2014), the Federal Circuit based its decision
on “allegations that the Corps denied the permit, and the alleged economic loss
attributable thereto.” Res. Invs., 785 F.3d at 665 (emphasis added). The latter
included the allegation that the property owner “stood to lose the large sums
already invested in the project, as well as the economic value of its investment in

2 The undersigned is strongly of the opinion that Justice Sotomayor’s interpretation
of Section 1500 in that case was correct, recognizing that “claim” was originally a
term of art in our jurisdictional statutes meaning a demand for money damages.
See Tohono O’Odham Nation, 563 U.S. at 325 (Sotomayor, J., concurring in
judgment).
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the project site.” Id. at 663 (internal quotations omitted). This suggests that for
there to be sufficient overlap of operative facts for an earlier-filed claim to be
considered the same as a takings claim for Section 1500 purposes, the claims must
have more in common than the same permit denials or same ordered action by the
federal agency.

      Nor can the Court agree with the government’s position that allegations
raised against other, non-federal parties in the earlier-filed suit can be considered
operative facts in the claims against the United States, when these are not
incorporated by reference in the counts against the latter. See Tr., ECF No. 154, at
33:4–19, 34:2–8, 37:6–7, 39:17–21. Section 1500, after all, requires that claims be
“against the United States” or those acting on behalf of the United States. 28
U.S.C. § 1500. Thus, the allegation that a state agency’s action caused “severe
economic loss or in the alternative total deprivation of use” and hence a taking,
D. Minn. Compl. ¶ 50, cannot contribute to a finding of “substantially the same
operative facts,” Tohono O’Odham Nation, 563 U.S. at 317.

       Unfortunately for plaintiff, the operative facts alleged in the district court
counts against the Corps do involve whether the latter’s actions resulted in a taking
of plaintiff ’s property. In that case, Mr. Bailey contended that the Corps violated
President Reagan’s Executive Order 12630, 53 Fed. Reg. 8859–62 (Mar. 15, 1988),
as the Corps “ha[d] not offered compensation to Plaintiff nor . . . conducted a before
and after valuation of the affected properties to determine the existence of a taking
as required by law.” D. Minn. Compl. ¶ 42. In the case before our court, plaintiff
alleges that the economic impact of the same actions of the Corps resulted in a
taking for which compensation had not yet been paid. Compl., ECF No. 1, ¶¶ II,
VII, XIII. Thus, central to the claims against the federal government that were
pending in the district court were the economic impact of the Corps’ decisions and
the necessity of paying just compensation, making those APA challenges different
from the typical ones based on procedural or jurisdictional irregularities. As these
are among the operative facts in the takings claim in this court, when added to the
permit denial and Restoration Order, there is sufficient overlap in operative facts
for the claims in the two cases to be considered the same for Section 1500 purposes.
See Res. Invs., 785 F.3d at 665–68. The Court concludes, reluctantly, that the
government’s motion must be GRANTED.

      Section 1500 has been variously (and correctly) described as: “an
anachronism depriving litigants of a fair opportunity to assert their rights,” Lower
Brule Sioux Tribe v. United States, 102 Fed. Cl. 421, 424 n.4 (2011); see also Keene
Corp. v. United States, 508 U.S. 200, 217 (1993) (discussing same criticism);
“outdated and ill-conceived,” Low v. United States, 90 Fed. Cl. 447, 455 (2009); “an
awkward tool that has outlived its original purpose,” Passamaquoddy Tribe v.
United States, 82 Fed. Cl. 256, 262 (2008); “inequitable,” Nat’l Union Fire Ins. Co. v.
United States, 19 Cl. Ct. 188, 190 (1989); “unfair and unworkable,” Yankton Sioux

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Tribe v. United States, 84 Fed. Cl. 225, 226 (2008); “badly drafted,” Keene Corp., 508
U.S. at 222 (Stevens, J., dissenting); and a “trap for the unwary,” d’Abrera v. United
States, 78 Fed. Cl. 51, 56 n.10 (2007); see Vaizburd v. United States, 46 Fed. Cl. 309,
310 (2000). This criticism is well-deserved, as the outcome of this case amply
demonstrates.

       For the reasons stated above, defendant’s motion to dismiss this case for lack
of subject-matter jurisdiction under Rule 12(b)(1) of the Rules of the United States
Court of Federal Claims and 28 U.S.C. § 1500 is therefore GRANTED. The Clerk
shall close the case. No costs shall be awarded.

IT IS SO ORDERED.

                                         s/ Victor J. Wolski
                                         VICTOR J. WOLSKI
                                         Senior Judge

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