United States District Court, N.D. Oklahoma
LYMAN GILBERT LENKER, Trustee of the Virginia Lenker Irrevocable Trust, Plaintiff,
KEVIN HAUGRUD, in his official capacity as Acting Secretary of the United States Department of Interior, UNITED STATES BUREAU OF INDIAN AFFAIRS, MICHAEL BLACK, in his official capacity as Director of the United States Bureau of Indian Affairs, and CEJA CORPORATION, Defendants.
OPINION AND ORDER
V. EAGAN O LIMITED STATES DISTRICT JUDGE
before the Court are a motion to dismiss (Dkt. # 39) of Kevin
Haugrud in his official capacity as Acting Secretary of the
United States Department of the Interior, the United States
Bureau of Indian Affairs (BIA), and Michael Black in his
official capacity as Director of the BIA (federal
defendants), and a summary judgment motion filed by Ceja
Corporation (Ceja) (Dkt. # 13). The federal defendants ask
the Court to dismiss plaintiff's claims against them
under Federal Rule of Civil Procedure 12(b)(1) for lack of
subject matter jurisdiction. Dkt. # 39. Ceja moves for
summary judgment on the grounds that the claims against it
are barred by the statute of limitations and by the doctrine
of consent. Dkt. # 13.
case arises from the BIA's approval of an oil lease and
two drilling permits on the subsurface mineral estate
underlying plaintiff's lands. In the Osage Allotment Act,
Congress established a subsurface mineral estate trust held
by the United States on behalf of the Osage Nation. Act of
June 28, 1906, ch. 3572, 34 Stat. 539; see also Osage
Nation v. Irby, 597 F.3d 1117, 1120-21 (10th Cir. 2010).
The Superintendent of the Osage Agency is authorized to
approve oil and gas leases made by the Osage Tribal Council
involving the Osage mineral estate. See 25 C.F.R.
§ 226.2. Once a lease has been approved, the lessee must
submit a separate application and obtain the
Superintendent's approval before drilling. Id.
at § 226.16(b). The National Environmental Policy Act,
42 U.S.C. § 4321 et seq. (NEPA), requires the
BIA to conduct an environmental impact study before the
Superintendent may approve a lease or drilling permit.
See 42 U.S.C. § 4332(2)(C); Davis v.
Morton, 469 F.2d 593, 597 (10th Cir. 1972).
August 2, 1978, the Superintendent approved a lease between
the Osage Nation and Ceja that included land plaintiff owns.
Dkt. # 17, at 17. Plaintiff alleges that the BIA violated
NEPA by failing to conduct any environmental analysis prior
to approval of the lease. Id. Plaintiff also alleges
that no notice of the lease approval was sent to
plaintiff's predecessors-in-interest. Id.
Plaintiff asserts that Ceja submitted an application to the
BIA to drill well 7 on plaintiff's property, which the
Superintendent approved on February 16, 2010. Id.
Plaintiff alleges that the Superintendent also approved
Ceja's application to drill well 6H on plaintiff's
property. Id. at 19. Plaintiff asserts that
the BIA failed to comply with NEPA prior to approval of both
well 7 and well 6H, and that the BIA failed to send plaintiff
or his predecessors-in-interest notice that either well had
been approved. Id. at 18-19. Plaintiff alleges that
Ceja drilled wells 7 and 6H and constructed oil and gas
related facilities on plaintiff's property. Id.
at 19. Plaintiff asserts that Ceja's actions caused
significant erosion and other environmental damage.
Id. Plaintiff also alleges that the BIA has approved
other “oil and gas related activity” on
plaintiff's property in violation of NEPA and without
notice to plaintiff or his predecessors-in-interest.
Id. at 20.
August 12, 2016, plaintiff brought this suit against the
federal defendants and Ceja. Dkt. # 2. Plaintiff filed an
amended complaint (Dkt. # 17) on October 7, 2016. Plaintiff
brings his claims against the federal defendants under the
Administrative Procedure Act, 5 U.S.C. § 701 et
seq. (APA). Plaintiff asks that the Court enter
declaratory judgment finding that the Superintendent's
approval of the lease, well 7, well 6H, and any unknown
leases, drilling permits, or workover permits approved since
January 1, 1970 concerning plaintiff's land, violated
NEPA and are legally inoperative. Dkt. # 17, at 20-27.
Plaintiff also asserts that Ceja's entry onto his
property constitutes trespass because Ceja's lease and
drilling permits are inoperative, and asks the Court to
enjoin Ceja from entry upon his land without a valid oil and
gas lease or permit. Id. at 27. Finally, plaintiff
alleges that he is entitled to rent payments under Oklahoma
law for Ceja's occupation of his land for the six years
preceding the filing of the complaint. Id. at 28.
The federal defendants now move for dismissal of
plaintiff's claims against them for lack of subject
matter jurisdiction, Dkt. # 39, at 1, and Ceja moves for
summary judgment on the claims against it, Dkt. # 13, at 1.
Court first considers the federal defendants' motion to
dismiss (Dkt. # 39). The federal defendants argue that
plaintiff's claims are barred by the statute of
limitations, that plaintiff has failed to establish a waiver
of sovereign immunity, that plaintiff has failed to exhaust
his administrative remedies, that plaintiff has failed to
identify any final agency action with respect to his claim
regarding unknown leases and permits, and that
plaintiff's claims are moot. Dkt. # 39.
considering a motion to dismiss under Federal Rule of Civil
Procedure 12(b)(1), the Court must determine whether the
plaintiff can establish that the Court has subject matter
jurisdiction over the defendant. “The burden of
establishing subject matter jurisdiction is on the party
asserting jurisdiction.” Montoya v. Chao, 296
F.3d 952, 955 (10th Cir. 2002) (citing Kokkonen v.
Guardian Life Ins. Co. Of Am., 511 U.S. 375, 377
(1994)). Rule 12(b)(1) motions can take the form of a facial
attack, whereby “the movant merely challenges the
sufficiency of the complaint, requiring the district court to
accept the allegations in the complaint as true, ” or
the form of a factual attack, whereby “the movant goes
beyond the allegations in the complaint and challenges the
facts upon which subject matter jurisdiction depends.”
Paper, Allied-Indus., Chem. and Energy Workers Int'l
Union v. Cont'l Carbon Co., 428 F.3d 1285, 1292
(10th Cir. 2005) (citation omitted). The federal
defendants' motion presents both a facial attack and a
factual attack. Dkt. # 39, at 7.
federal defendants argue that plaintiff has failed to
identify a final agency action reviewable under the APA
because plaintiff has failed to exhaust his administrative
remedies. Dkt. # 39, at 19-21. Plaintiff does not allege that
he appealed the Superintendent's decisions, but instead
argues that he was not required to exhaust administrative
remedies because the Superintendent's approvals of the
lease and drilling permits are final agency actions not
subject to administrative appeal. Dkt. # 41, at 24. Under the
APA, final agency actions for which there are no other
adequate remedies in a court are subject to judicial review.
5 U.S.C. § 704. The actions of BIA officials are not
final unless administrative remedies have been exhausted.
See 43 C.F.R. § 4.314; 25 C.F.R. § 2.6;
see also Coosewood v. Meridian Oil Co., 25 F.3d 920,
924-25 (10th Cir. 1994). Under the BIA regulations, any
decision or order issued by the Superintendent related to
governing the leasing of Osage reservation lands for oil and
gas mining may be appealed pursuant to 25 C.F.R. part
S e e 25 C.F.R. § 226.44. The exhaustion
requirement “recognizes the notion, grounded in
deference to Congress' delegation of authority to
coordinate branches of Government, that agencies, not the
courts, ought to have primary responsibility for the programs
that Congress has charged them to administer.”
United Tribe of Shawnee Indians v. United States,
253 F.3d 543, 550 (10th Cir. 2001) (quoting McCarthy v.
Madigan, 503 U.S. 140, 145 (1992)). Plaintiff argues
that he was not required to exhaust his administrative
remedies for two reasons: (1) neither plaintiff nor his
predecessors-in-interest received a notice of appeal rights,
and (2) the approvals were effectively decisions of the
Assistant Secretary, which are final unless the decision
provides otherwise. Dkt. # 43, at 24.
alleges that the BIA failed to notify him or his
predecessors-in-interest when the Superintendent approved the
lease and drilling permits. However, even if the BIA failed
to give any notice of the Superintendent's decisions,
plaintiff is not excused from exhausting his administrative
remedies. A BIA official making a decision “shall give
all interested parties known to the decisionmaker written
notice of the decision by personal delivery or mail.”
25 C.F.R. § 2.7(a). Written notice must include a
statement that the decision may be appealed and detail the
appeal procedures. Id. § 2.7(c). “Failure
to give such notice shall not affect the validity of the
decision or action but the time to file a notice of appeal
regarding such a decision shall not begin to run until notice
has been given.” Id. § 2.7(b). Thus, if
the BIA fails to properly notify an interested party, the
time to appeal the decision is extended, but plaintiff's
obligation to pursue an administrative appeal before filing
suit in federal court is unchanged. See Begay v. Pub.
Serv. Co. of N.M., 710 F.Supp.2d 1161, 1205 (D.N.M.
2010) (“Failure of the BIA to provide a notice does not
necessarily cancel the administrative-remedy process.
Instead, failure of the agency to give notice of the initial
agency action simply extends the time in which the plaintiff
can appeal that action.”) (citing Cheyenne-Arapaho
Tribes Okla. v. United States, 966 F.2d 583, 588 (10th
Cir. 1992)); Nulankeyutmonen Nkihtaqmikon v. Impson,
573 F.Supp.2d 311, 321-22 (D. Me. 2008) (“Although
§ 2.7 can extend the time limits for filing a notice of
appeal, it does not eliminate the obligation to exhaust
administrative remedies by proceeding with an appeal once
notice is given.”). Therefore, even if plaintiff
received no notice from the BIA regarding the
Superintendent's approvals of the lease and drilling
permits, plaintiff is still obligated to exhaust his
also argues that the Superintendent's decisions were
final agency actions. Decisions made by the Assistant
Secretary are final and immediately effective unless the
Assistant Secretary provides otherwise in the decision. 25
C.F.R. § 2.6(c). Plaintiff argues that because the
Superintendent approved the lease and drilling permits
pursuant to authority delegated to him by the Assistant
Secretary, the Superintendent's approval of the lease and