for the district of columbia sisseton wahpeton oyate … · 2015-09-23 · in the united states...

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

SISSETON WAHPETON OYATE OF THE LAKE TRAVERSE RESERVATION, et al., Plaintiffs, v. JEWELL, et al., Defendants.

) ) ) ) ) ) ) ) ) ) )

No. 13-cv-601 Hon. Thomas F. Hogan

DEFENDANTS’ REPLY MEMORANDUM IN SUPPORT OF THEIR MOTION TO

DISMISS ROBERT G. DREHER

Acting Assistant Attorney General STEPHEN R. TERRELL CA Bar No. 210004 Trial Attorney United States Department of Justice Environment & Natural Resources Division P.O. Box 7611 Washington, D.C. 20044-7611 Tel.: (202) 616-9663 Fax: (202) 305-0506 [email protected] Attorney for Defendants

Case 1:13-cv-00601-TFH Document 23 Filed 03/10/14 of 24

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TABLE OF CONTENTS

I. INTRODUCTION ................................................................................................................... 1

II. STANDARD OF REVIEW ..................................................................................................... 3

III. ARGUMENT ....................................................................................................................... 4

A. Plaintiffs Have Failed to State “Non-APA” Claims in Counts I and II. .............................. 4

B. Plaintiffs’ Count I Should be Dismissed. ............................................................................. 8

1. Plaintiffs’ challenge to defendants’ compliance with Section 4044 is untimely. .... 8

2. Plaintiffs have failed to state a claim for an additional accounting.......................... 9

3. Plaintiffs’ “standards” claims should be dismissed. ............................................... 12

C. Plaintiffs’ Count II Should be Dismissed. ......................................................................... 12

1. This Court lacks subject-matter jurisdiction over plaintiffs’ “trust account balance correction and wholeness” claims. ......................................................................... 12

2. Plaintiffs’ accounting claims should be dismissed. ................................................ 14

3. Plaintiffs’ record retention claim should be dismissed. ......................................... 16

D. Plaintiffs’ Count III Should Be Dismissed. ....................................................................... 17

IV. CONCLUSION ..................................................................................................................... 18


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TABLE OF AUTHORITIES

Cases

Assoc. of Civilian Techicians, Inc. v. FLRA, 283 F.3d 339 (D.C. Cir. 2002) ................................. 5

Beaty v. F.D.A., 853 F. Supp. 2d 30 (D.D.C. 2012) ..................................................................... 18

Bowen v. Massachussets, 487 U.S. 879 (1988) ............................................................................ 13

Chamber of Commerce v. Reich, 74 F.3d 1322 (D.C. Cir. 1996) ................................................... 6

City of Houston, Tex. v. Dep’t of Hous. and Urban Dev., 24 F.3d 1421 (D.C. Cir. 1994)........... 14

Cobell v. Salazar

37 F. Supp. 2d 6 (D.D.C. 1999) ........................................................................................ 16

240 F.3d 1081 (D.C. Cir. 2001) ........................................................................................ 16

229 F.R.D. 5 (D.D.C. 2005) .............................................................................................. 16

455 F.3d 301 (D.C. Cir. 2006) .......................................................................................... 11

455 F.3d 317 (D.C. Cir. 2006) .......................................................................................... 16

532 F. Supp. 2d 37 (D.D.C. 2008) .................................................................................... 17

573 F.3d 808 (D.C. Cir. 2009) .......................................................................................... 10

Cohen v. United States, 650 F.3d 717 (D.C. Cir. 2011) ................................................................. 3

Dart v. United States, 848 F.2d 217 (D.C. Cir. 1988) .................................................................... 6

Fed. Deposit Ins. Co. v. Meyer, 510 U.S. 471 (1994)................................................................. 1, 3

Felter v. Kempthorne, 473 F.3d 1255 (D.C. Cir. 2007) .................................................................. 3

Five Flags Pipe Line Co. v. Dep’t of Transp., 854 F.2d 1438 (D.C. Cir. 1988) ........................... 5

Fletcher v. United States, No. 02-cv-427, 2014 WL 356895 (N.D. Okla. Jan. 31, 2014) ............ 10

Fund for Animals, Inc. v. U.S. Bureau of Land Mgmt., 460 F.3d 13 (D.C. Cir. 2006)................... 4

Great-West Life & Annuity Ins. Co. v. Knudson, 534 U.S. 204 (2002) ........................................ 13

Griffith v. FLRA, 842 F.2d 487 (D.C. Cir. 1988) ........................................................................ 5, 6

Hardin v. Jackson, 625 F.3d 739 (D.C. Cir. 2010) ......................................................................... 3


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Hubbard v. EPA, 982 F.2d 531 (D.C. Cir. 1992) ......................................................................... 14

Leedom v. Kyne, 358 U.S. 184 (1958) ............................................................................................ 5

Lujan v. Nat’l Wildlife Fed’n, 497 U.S. 871 (1990) ..................................................................... 15

Morales v. YWA, Inc., 504 U.S. 374 (1992)) ................................................................................ 10

Mountains for Multiple Use v. Barbouletos, 568 F.3d 225 (D.C. Cir. 2009) ............................... 15

Nat’l Air Traffic Controllers Ass’n v. Fed. Serv. Impasses Panel, 606 F.3d 780 (D.C. Cir. 2010) 3

Nat’l Ass’n of Home Builders v. U.S. Army Corps of Eng’rs, 417 F.3d 1272 (D.C. Cir. 2005)..... 7

National Wrestling Coaches Ass’n v. Dept. of Educ., 366 F.3d 930 (D.C. Cir. 2004) ................... 6

Norton v. S. Utah Wilderness Alliance, 542 U.S. 55 (2006)......................................... 7, 14, 15, 17

Oestereich v. Selective Serv. Sys. Local Bd. No. 11, 393 U.S. 233 (1968) ..................................... 6

Otoe-Missouria Tribe of Okla. v. Kempthorne, No. 06-cv-1436, 2008 WL 742896 (W.D. Okla. Dec. 10, 2008) ................................................................................................................... 18

Ratzlaf v. United States, 510 U.S. 135 (1994) ................................................................................ 9

Sierra Club v. Jackson, 648 F.3d 848 (D.C. Cir. 2011).................................................................. 4

Spannus v. U.S. Dep’t of Justice, 824 F.2d 52 (D.C. Cir. 1987) .................................................... 3

Sparrow v. United Air Lines, Inc., 216 F.3d 1111 (D.C. Cir. 2000) ............................................... 4

Transohio Sav. Bank v. Dir., Office of Thrift Supervision, 967 F.2d 598 (D.C. Cir. 1992) ........... 6

Trudeau v. Fed. Trade Comm'n, 456 F.3d 178 (D.C. Cir. 2006) ............................................ 5, 6, 7

United States v. Jicarilla Apache Nation, 564 U.S. ___, 131 S. Ct. 2313 (2011) .................. 10, 12

United States v. Regenerative Sciences, 878 F. Supp. 2d. 248 (D.D.C. 2012) ............................... 3

Statutes and Rules

Administrative Procedure Act

5 U.S.C. § 702 ............................................................................................................ passim

5 U.S.C. § 704 ............................................................................................................... 6, 17

5 U.S.C. § 706 ................................................................................................... 7, 14, 17, 18


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American Indian Trust Reform Act of 1994, Pub. L. No. 103-412, 108 Stat. 4248 (1994)

25 U.S.C. § 162a ......................................................................................................... 11, 17

25 U.S.C. § 4011 ............................................................................................. 10, 11, 15, 17

25 U.S.C. § 4044 ........................................................................................................ passim

Federal Records Act of 1950, 44 U.S.C. §§ 2901, et seq. ............................................................ 16

Federal Records Disposal Act, 44 U.S.C. §§ 3301, et seq. ........................................................... 16

Pub. L. No. 107-153, § 1, 116 Stat. 79 (2002), as amended by Pub. L. No. 100-158, § 1, 119 Stat. 2954 (2005) ......................................................................................................................... 9

28 U.S.C. § 2201 ........................................................................................................................... 12

28 U.S.C. § 2401 ............................................................................................................................. 3

Fed. R. Civ. P. 12 ................................................................................................................... passim


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I. INTRODUCTION

Defendants moved to dismiss plaintiffs’ Second Amended Complaint for lack of subject-

matter jurisdiction because the facts alleged therein failed to invoke a waiver of sovereign

immunity. See generally Motion to Dismiss (“Mot.”), ECF No. 19. “Sovereign immunity is

jurisdictional” and “[a]bsent a waiver, . . . shields the Federal Government and its agencies from

suit.” Fed. Deposit Ins. Co. v. Meyer, 510 U.S. 471, 475 (1994). Thus, in this case, plaintiffs

must plead facts properly invoking a waiver of sovereign immunity. See Plaintiffs’

Memorandum of Points and Authorities in Opposition to Defendants’ Motion to Dismiss

(“Opp’n”) at 5, ECF No. 22 (“It is well established that when bringing an action against the

United States or its officials, . . . there must be . . . a waiver of sovereign immunity . . .”).

Plaintiffs have failed to allege facts in their Second Amended Complaint that bring their claims

within an applicable waiver of sovereign immunity. Alternatively, plaintiffs have failed to allege

facts that state a claim and the Court may alternatively grant defendants’ motion under Rule

12(b)(6).

Nowhere in their opposition brief do plaintiffs even attempt to refute defendants’ point

that claims based upon alleged “inherent fiduciary duties” are not cognizable in this Court. See

Mot. at 8-9; c.f. Opp’n at 1 n.1 (mentioning, but failing to respond substantively to defendants’

argument). Instead, plaintiffs recast their claims in Counts I and II as “constitutional and

statutorily-based claims” that “proceed independently and regardless of” the requirements of an

Administrative Procedure Act (“APA”) cause of action. Id. at 11. This re-characterization fares

no better than plaintiffs’ original formulation, and plaintiffs’ “non-APA” claims neither support

jurisdiction nor state a viable claim for relief.

Plaintiffs’ APA claims are similarly deficient. Plaintiffs admit in their Second Amended

Complaint, and do not dispute in their opposition to this motion, that they received the materials


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called for under the American Indian Trust Reform Act of 1994, Pub. L. No. 103-412, 108 Stat.

4248 (1994), (“1994 Act”) in 1996. Second Am. Compl. (“SAC”) ¶ 46, ECF No. 20. Plaintiffs’

opposition reinforces the numerous allegations in their complaint that establish that they knew or

should have known of any deficiencies with the Department of the Interior’s compliance with the

1994 Act years ago and well outside the limitations period. See Opp’n at 20 (citing 2003 report).

As such, any challenges to the Department of the Interior’s compliance with the 1994 Act,

whether or not couched as a “failure to act,” are untimely. Those claims should be dismissed.

Furthermore, although plaintiffs argue that they are not seeking money damages, Opp’n

at 9, it is plainly evident they are. Id. at 14-20. Plaintiffs’ attempt to interpret “reconciled” as

congressional authorization for this Court to order defendants to pay money to plaintiffs is

unavailing. Plaintiffs’ claims for the payment of money, even under an equitable theory, are

outside the APA’s limited waiver of sovereign immunity.

Plaintiffs are therefore left in their opposition to arguing that they believe they are

entitled to something from defendants without articulating what it is. See SAC ¶ 64. Plaintiff’s

request for an “accounting of what you have done with our money” and the payment of money

“if you have mismanaged it,” Opp’n at 24, is not tethered to any statute, regulation, or judicially-

enforceable obligation. Based upon their claim for an undefined “accounting,” and the mere

possibility of mismanagement, plaintiffs now ask this Court to effectively take control of the

Department of the Interior’s statutory trust fund accounting and reconciliation functions, declare

“the accounting standards governing complete and accurate accountings of Plaintiffs’ trust

accounts,” and compel the Department of the Interior to provide that accounting. SAC, Prayer

¶¶ 4-5. These claims go too far, and are precisely the types of claims that the Supreme Court has

repeatedly held are outside the APA’s limited waiver of sovereign immunity and conditional


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grant of a cause of action. Plaintiffs’ Second Amended Complaint should be dismissed in its

entirety.

II. STANDARD OF REVIEW

Plaintiffs argue that defendants’ motion is properly advanced under Rule 12(b)(6) instead

of Rule 12(b)(1). Opp’n at 3-4. Plaintiffs are mistaken, and, even if plaintiffs are correct, the

distinction is of no moment in this case. In any event, plaintiffs fail to state a claim upon which

relief can be granted under Rule 12(b)(6).

Sovereign immunity is jurisdictional. Cohen v. United States, 650 F.3d 717, 723 (D.C.

Cir. 2011) (citing Meyer, 510 U.S. at 475). Thus, plaintiffs must allege sufficient facts to

establish jurisdiction, including a waiver of sovereign immunity. Nat’l Air Traffic Controllers

Ass’n v. Fed. Serv. Impasses Panel, 606 F.3d 780, 788 (D.C. Cir. 2010). Defendants’ arguments

that plaintiffs have failed to allege facts establishing a waiver of sovereign immunity applicable

to their claims are jurisdictional and are properly advanced under Rule 12(b)(1).

Also, the United States Court of Appeals for the District of Columbia Circuit has long

acknowledged that the statute of limitations contained in 28 U.S.C. § 2401(a) is jurisdictional.

Felter v. Kempthorne, 473 F.3d 1255, 1260 (D.C. Cir. 2007) (citing cases). Plaintiffs’ citation to

United States v. Regenerative Sciences, 878 F. Supp. 2d. 248 (D.D.C. 2012), to suggest that this

is an open question in the District of Columbia Circuit, see Opp’n at 27 n.5, is error.

Regenerative Sciences overlooked Hardin v. Jackson, 625 F.3d 739 (D.C. Cir. 2010), and only

relied upon pre-Hardin opinions. The District of Columbia Circuit has been clear, “we have

long held that section 2401(a) creates ‘a jurisdictional condition attached to the government’s

waiver of sovereign immunity.’” Hardin, 516 F.3d at 1026 (quoting Spannus v. U.S. Dep’t of

Justice, 824 F.2d 52, 55 (D.C. Cir. 1987)). Defendants’ arguments that plaintiffs’ claims are

untimely are jurisdictional. Felter, 473 F.3d at 1260.


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Moreover, defendants have not, in their opening brief, “collapse[d] the merits of

Plaintiffs’ claims into questions of jurisdiction and waiver of sovereign immunity.” Opp’n at 1.

Instead, defendants have properly advanced a facial challenge to subject-matter jurisdiction.

Mot. at 2-3. Defendants have not relied upon “merits” evidence extraneous to plaintiffs’

complaint to support their jurisdictional arguments.

Because defendants have advanced a facial challenge to subject-matter jurisdiction, the

same standard of review applied to Rule 12(b)(6) motions applies to this motion. Sparrow v.

United Air Lines, Inc., 216 F.3d 1111, 1113 (D.C. Cir. 2000). The Court may treat defendant’s

motion as one under Rule 12(b)(6) and grant defendants’ motion. Sierra Club v. Jackson, 648

F.3d 848, 854 (D.C. Cir. 2011).1/ Thus, if the Court determines that defendants have shown that

plaintiffs have failed to state a claim upon which relief can be granted it should grant defendants’

motion under Rule 12(b)(6).

III. ARGUMENT

A. Plaintiffs Have Failed to State “Non-APA” Claims in Counts I and II.

Plaintiffs devote much of their opposition brief to arguing that Counts I and II may

survive because (a) they maintain that Section 702 of the APA provides a broad waiver of

sovereign immunity for all non-monetary claims and (b) their claims do not need to meet any

other elements of the APA because they are “statutorily based” claims that exist “independently

and regardless of the APA’s causes of action.” See Opp’n at 11. Plaintiffs repeatedly refer to 1/ For example, plaintiffs are correct that the District of Columbia Circuit has held that whether there has been “agency action” or “final agency action” is not jurisdictional, but instead bears upon whether plaintiffs have properly stated a claim. Fund for Animals, Inc. v. U.S. Bureau of Land Mgmt., 460 F.3d 13, 18 n.4 (D.C. Cir. 2006). Thus, the Court can convert defendants’ Rule 12(b)(1) motion to dismiss to a motion to dismiss for failure to state a claim under Rule 12(b)(6) where appropriate. This change, through, does not alter any of defendants’ arguments, as a facial challenge under Rule 12(b)(1) is assessed under the same standards as a Rule 12(b)(6) motion.


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these claims as “non-APA” claims. See Opp’n at 1, 2, 4, 6, 7, 22, 23. Plaintiffs’ assertion that

Counts I and II are “statutory claims” that may somehow be asserted “outside the APA” is not

supportable. For this proposition, plaintiffs rely heavily on Trudeau v. Federal Trade

Commission, 456 F.3d 178 (D.C. Cir. 2006). Opp’n at 6-7. Plaintiffs misread Trudeau and

neither the Supreme Court nor the District of Columbia Circuit have held the APA’s sovereign

immunity waiver to be so overreaching.

At issue in Trudeau were three types of claims: (1) APA claims; (2) a “‘nonstatutory

action, independent of the APA;’” and (2) a constitutional claim. 456 F.3d at 185. Plaintiffs

equate the “nonstatutory claim” at issue in Trudeau with their alleged “non-APA” claims in

Counts I and II. Plaintiffs argument is misplaced because the “nonstatutory” claims at issue in

Trudeau, as well as in other District of Columbia Circuit precedent, were ultra vires claims. See

id. at 346-47. Plaintiffs have not, and cannot, allege that defendants acted ultra vires by

allegedly failing to provide plaintiffs with a “complete and accurate” accounting of their tribal

trust funds.

The doctrine of “nonstatutory” review2/ of agency action, as embodied in cases such as

the Supreme Court’s Leedom v. Kyne decision, “is intended to be of extremely limited scope.”

Griffith v. FLRA, 842 F.2d 487, 493 (D.C. Cir. 1988) (discussing Leedom v. Kyne, 358 U.S. 184

(1958)); see Assoc. of Civilian Techicians, Inc. v. FLRA, 283 F.3d 339, 344 (D.C. Cir. 2002), cert

denied, 537 U.S. 1045 (2002) (describing Leedom jurisdiction as “extraordinary”). As the

District of Columbia Circuit has explained, nonstatutory review is meant to permit judicial

review of agency action that is “lawless behavior,” but that is also not final agency action, and so

2/ As the District of Columbia Circuit has observed, “nonstatutory review” is “a confusing misnomer.” Five Flags Pipe Line Co. v. Dep’t of Transp., 854 F.2d 1438, 1439-1440 (D.C. Cir. 1988).


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would escape review under the APA. Dart v. United States, 848 F.2d 217, 224 (D.C. Cir. 1988).

It is confined “to agency error so extreme that one may view it as jurisdictional or nearly so.”

Griffith, 842 F.2d at 493.

Thus, nonstatutory review (what plaintiffs dub “non-APA” review) applies to agency

action that is “contrary to a specific prohibition in [a statute] that [is] clear and mandatory.” Id.

(quotation marks omitted). It applies when an “agency’s error is patently a misconstruction of [a

statute], or when the agency has disregarded a specific and unambiguous statutory directive, or

when the agency has violated some specific command of a statute.” Id. (citations and quotation

marks omitted); see also Chamber of Commerce v. Reich, 74 F.3d 1322, 1327-28, 1330 (D.C.

Cir. 1996). It also applies when an agency deprives an individual of a right expressly guaranteed

by statute. Griffith, 842 F.2d at 493; see Oestereich v. Selective Serv. Sys. Local Bd. No. 11, 393

U.S. 233 (1968). But “[g]arden-variety errors of law or fact are not enough.” Griffith, 842 F.2d

at 493; see also Trudeau, 456 F.3d at 347 (describing nonstatutory review as a “narrow

exception”).3/

Here, plaintiffs only aver in Counts I and II that defendants have made errors of law.

They argue that the accounting and reconciliation materials they have been provided by

3/ Ultra vires claims should not be confused with constitutional claims or claims under other statutes that create a private right of action. See Opp’n at 11 (citing cases). Plaintiffs have not advanced constitutional claims in this case. Plaintiffs also have not identified a statute that provides a private right of action for the accounting they seek. Even where other statutes provide a private right of action, plaintiffs must depend on the waiver of sovereign immunity in Section 702. However, the waiver of sovereign immunity under Section 702 is limited by the “adequate remedy” bar of Section 704. See Transohio Sav. Bank v. Dir., Office of Thrift Supervision, 967 F.2d 598, 607 (D.C. Cir. 1992) (“The APA excludes from its waiver of sovereign immunity. . . claims for which an adequate remedy is available elsewhere.”). As such, the availability of a private cause of action in several of the cases relied upon by plaintiffs, see Opp’n at 11, would bar plaintiffs’ assertion of non-APA causes of action, because there is no waiver of sovereign immunity where plaintiffs have an adequate alternative remedy in court. See National Wrestling Coaches Ass’n v. Dept. of Educ., 366 F.3d 930, 947 (D.C. Cir. 2004) (Title IX cause of action).


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defendants are inadequate or insufficient, and that they are entitled to more. See, e.g., SAC ¶¶

47-52. These are not ultra vires claims that fall within the narrow category of “nonstatutory

review” within Section 702’s sovereign immunity waiver.

Furthermore, there is no reasonable dispute that Counts I and II of plaintiffs’ complaint

are essentially “failure to act” claims. See SAC ¶ 11 (“failure to provide complete and accurate

trust accountings”); ¶ 49 (same); ¶ 50 (“Defendants admittedly and consistently have failed and

continue to fail to comply with their inherent fiduciary and statutory duties”); ¶ 57 (“failure to

account for and manage properly”); ¶ 60 (“failure and continuing failure to provide Plaintiffs

with complete and accurate accountings”). Plaintiffs ask this court to compel defendants to

provide an accounting, preserve documents, and correct fund balances because of an alleged

failure to act by defendants.

“[A] party seeking to challenge an agency’s failure to act faces a different burden from

that borne by a challenger of agency action.” Nat’l Ass’n of Home Builders v. U.S. Army Corps

of Eng’rs, 417 F.3d 1272, 1280 (D.C. Cir. 2005) (emphasis omitted). “Failure to act claims” of

the type advanced by plaintiffs are only cognizable under the APA, specifically 5 U.S.C. §

706(1). A failure to act cause of action is not, as plaintiffs claim, a “non-APA” claim. Indeed, at

issue in Trudeau was a challenge to any agency’s action (not inaction): the issuance of a press

release. 456 F.3d at 182. To state a claim under the APA to compel agency action unlawfully

withheld or unreasonably delayed, plaintiffs must comply with the requirements of the APA,

including alleging discrete agency action that is demanded by law. Norton v. S. Utah Wilderness

Alliance, 542 U.S. 55, 63-65 (2006) (“SUWA”).

As set forth in defendants’ motion and herein, Counts I and II of plaintiffs’ complaint do

not fall within the APA’s sovereign immunity waiver. Even if they do, they can only be


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advanced as APA claims and plaintiffs have failed to plead facts to state a cause of action under

the APA. Plaintiffs’ complaint should be dismissed.

B. Plaintiffs’ Count I Should be Dismissed.

1. Plaintiffs’ challenge to defendants’ compliance with Section 4044 is untimely.

In Count I of their complaint, plaintiffs seek declaratory relief. SAC ¶¶ 59-64.

Specifically, they seek a declaratory judgment that the reconciliation reports and associated

materials provided by the Department of the Interior to plaintiffs in 1996 did not comply with 25

U.S.C. § 4044. Id. This claim is untimely under the six-year statute of limitations, thus this

Court lacks subject-matter jurisdiction over this claim regardless of whether it is a “non-APA” or

“APA” claim.

Plaintiffs aver that “[t]he AA Reports provided by Defendants to Plaintiffs are not

complete and accurate accountings of each of Plaintiffs’ trust accounts.” Id. ¶ 61. For tribes, the

1994 Act called upon the Department of the Interior to transmit to Congress “a balance

reconciled as of September 30, 1995” for tribal trust accounts and to “provide the account holder

with as full and complete an accounting as possible of the account holder’s funds to the earliest

possible date.” 25 U.S.C. § 4044. Plaintiffs allege that they received these reports (which

plaintiffs call the “AA Reports”) in 1996. SAC ¶ 46. Plaintiffs argue in their opposition that

“[s]even years ago,” defendants allegedly admitted they had not completed “such accountings.”

Opp’n at 29 (emphasis added). Yet plaintiffs argue that their claims for failure to comply with

this provision of the 1994 Act have somehow not accrued. Id. at 26-32. This is suprising, since

plaintiffs’ own complaint admits that: there was a statute in the United States Code that required

a report to be provided to plaintiffs; plaintiffs acknowledge receiving those reports in 1996 (SAC

¶ 46); and plaintiffs were aware of criticisms of these reports long before 2007 (see SAC ¶¶ 8-9,


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47-52). Plaintiffs clearly knew or should have known of their claims challenging the Department

of the Interior’s compliance with Section 4044 long before 2007 (six years prior to filing their

complaint).

Furthermore, Congress has spoken as to the statute of limitations applicable to claims

challenging the Department of the Interior’s compliance with the reconciliation provisions of the

1994 Act. Although plaintiffs claim that “the Settlement of Tribal Claims Acts contain no such

specific accrual date provisions,” Opp’n at 32, Congress could not have been more clear:

[F]or purposes of applying a statute of limitations, any [reconciliation] report provided to or received by an Indian tribe in response to Section 304 of the [1994 Act] shall be deemed to have been received by the Indian tribe on December 31, 2000.

Pub. L. No. 107-153, § 1, 116 Stat. 79 (2002), as amended by Pub. L. No. 100-158, § 1, 119 Stat.

2954 (2005) (emphasis added). Congress specifically addressed the statute of limitations and set

an accrual date. Where the statute is clear, there is no need to resort to legislative history, for the

plain language of the statute controls. Ratzlaf v. United States, 510 U.S. 135, 147–48 (1994)

(“[W]e do not resort to legislative history to cloud a statutory text that is clear.”). Congress

legislated that the statute of limitations for claims challenging defendants’ compliance with the

reconciliation provisions of the 1994 Act ran on December 31, 2006. Plaintiffs’ challenges to

defendants’ compliance with Section 4044 of the 1994 Act are untimely, this Court lacks

subject-matter jurisdiction over those claims, and they should be dismissed.

2. Plaintiffs have failed to state a claim for an additional accounting.

Plaintiffs also seek a declaration that “Defendants never otherwise have provided

Plaintiffs with complete and accurate accountings of each Plaintiffs’ trust accounts.” SAC ¶ 62.

Plaintiffs have failed to identify a substantive source of law that would entitle them to this

additional accounting. Furthermore, plaintiffs have not alleged facts establishing that defendants


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have failed to provide them with the accountings required by law that are within the limitations

period.

In addition to Section 4044, plaintiffs argue they are entitled to an additional accounting

under Section 4011. Opp’n at 12. In support of this proposition, plaintiffs rely exclusively on

two cases involving individual Indians, Cobell v. Salazar, 573 F.3d 808 (D.C. Cir. 2009)

(“Cobell XXII”) and Fletcher v. United States, No. 02-cv-427, 2014 WL 356895 (N.D. Okla. Jan.

31, 2014). Id. Plaintiffs fail to respond to defendants’ argument that Congress’s specific

reconciliation requirement in Section 4044 supersedes any more general historical accounting

requirement in Section 4011. Mot. at 10 (citing Morales v. YWA, Inc., 504 U.S. 374, 384-85

(1992)). Reading Section 4011 to require a more expansive historical accounting of tribal trust

accounts than that required by Congress in Section 4044 “would vitiate Congress’ specifications

of narrowly defined” tribal trust fund reconciliation obligations. United States v. Jicarilla

Apache Nation, 564 U.S. ___, 131 S. Ct. 2313, 2330 (2011). Plaintiffs’ attempt to confuse

claims for a tribal account reconciliation with expansive historical accountings that some Courts

have required for individual Indian funds (which did not receive reconciliation reports under

Section 4044), in spite of the specific historic reconciliation obligations under Section 4044,

should not be countenanced. The specific controls the general, and because plaintiffs are

advancing claims for an accounting of “funds and/or assets in trust accounts for tribes,” SAC ¶ 2

(emphasis added), those claims are governed by the specific statute addressing tribal trust

account reconciliation, 25 U.S.C. § 4044.

As for Section 4011(b), plaintiffs nowhere allege in their complaint that they have failed

to receive periodic statements of performance for their trust accounts since the 1994 Act was

enacted. See Mot. at 10. Plaintiffs do not dispute this fact in their opposition. Thus, Section


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4011 does not provide a basis for plaintiffs’ non-Section 4044 historical accounting claims.

Plaintiffs have failed to state facts entitling them to relief under 25 U.S.C. § 4011(b).

Plaintiffs also cite to the provisions of 25 U.S.C. § 162a added by the 1994 Act. Opp’n at

13. Plaintiffs do not cite to any case that has held that 25 U.S.C. § 162a(d) entitles an Indian

tribe to an historical accounting. The United States is unaware of any such case. As with

Section 4011, any general accounting provisions in 25 U.S.C. § 162a(d) are trumped by the

specific reconciliation provisions enacted by Congress for tribal trust funds contained in Section

4044.

The provisions cited by plaintiffs define the Secretary of Interior’s trust responsibilities to

include “[p]roviding adequate systems for accounting.” 25 U.S.C. § 162(a)(d)(1). Plaintiffs do

not allege in their complaint that, since enactment of the 1994 Act, the Department of the Interior

has failed to implement or improve adequate accounting systems for tribal trust funds.

Furthermore, were this Court to judicially mandate how defendants should operate their

accounting systems currently and prospectively, that would be precisely the type of structural

injunction that the District of Columbia Circuit has held to be improper. Cobell v. Kempthorne,

455 F.3d 301, 305 (D.C. Cir. 2006) (“Cobell XVIII”).

Plaintiffs also cite to the Secretary of the Interior’s trust responsibility to provide

“periodic, timely reconciliations to assure the accuracy of accounts.” Again, plaintiffs do not

allege that they have not received periodic statements of performance for their tribal trust

accounts since the 1994 Act was enacted. Plaintiffs have simply failed to state a claim under 25

U.S.C. § 162a.

To the extent plaintiffs seek an historical reconciliation or accounting of their tribal trust

funds, the only applicable statute is Section 4044. As set forth above, plaintiffs claims under


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Section 4044 are untimely. Plaintiffs’ Count I should be dismissed.

3. Plaintiffs’ “standards” claims should be dismissed.

Also in Count I, plaintiffs seek a declaratory judgment “regarding the standards

governing complete and accurate accounting of Plaintiffs’ trust accounts.” SAC ¶ 64. Plaintiffs

do not address this claim in their opposition and it is unclear from plaintiffs’ complaint if this

request is based on a statute, regulation, or other substantive source of law. In the abstract, this

seems an odd request, as the Supreme Court has held that “[t]he trust obligations of the United

States to Indian tribes are established and governed by statute,” Jicarilla, 131 S. Ct. 2318, and a

declaratory judgment that the law is the law is unnecessary. Furthermore, as plaintiffs have

failed to plead facts establishing that they are entitled to an account reconciliation or accounting

within this Court’s subject-matter jurisdiction, there is no “case of actual controversy,” 28 U.S.C.

§ 2201, in which the Court may apply the law to the facts to declare “the standards governing

complete and accurate accounting of Plaintiffs’ trust accounts.” Plaintiffs’ Count I should be

dismissed in its entirety.

C. Plaintiffs’ Count II Should be Dismissed.

1. This Court lacks subject-matter jurisdiction over plaintiffs’ “trust account balance correction and wholeness” claims.

In Count II, plaintiffs seek “mandatory injunctive relief compelling Defendants to correct

Plaintiffs’ trust fund account balances.” SAC ¶ 69. Plaintiffs’ argument hinges upon an

interpretation of “reconciled,” and they devote over five pages of their opposition to a

convoluted “legislative history” to support their argument that “reconciled” includes the payment

of money. Opp’n at 14-20. Plaintiffs’ argument cannot be squared with the plain language of

the statute at issue, 25 U.S.C. § 4044, or the APA’s exclusions of money damage awards from its

sovereign immunity waiver.


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First, plaintiffs’ attempt to define “reconciled” as including “account balance correction,”

Opp’n at 20, fails to honor the statute. Congress did not afford plaintiffs a right to have accounts

reconciled at any time. Instead, Congress asked the Secretary of the Interior to provide “a

balance reconciled as of September 30, 1995.” 25 U.S.C. § 4044 (emphasis added).

Furthermore, Congress did not call for an equitable award of money by a court in the instances

where there were disputed account balances. Instead, Congress called upon the Secretary of the

Interior, in the instance of an “account balance disputed by the account holder,” to outline

“efforts the Secretary will undertake to resolve the dispute.” Id. (emphasis added). The 1994

Act does not “plainly support Plaintiffs’ claim for account balance correction and wholeness” in

2013 (when plaintiffs filed their complaint). C.f. Opp’n at 20. As discussed above, any

challenge to the reconciled account balance provided by the Department of the Interior to

plaintiffs in 1996 is untimely and outside this Court’s subject-matter jurisdiction. See Section

III.B.1, supra.

Second, the APA’s waiver of sovereign immunity, upon which plaintiffs rely, is limited

to claims for “relief other than money damages.” 5 U.S.C. § 702. As explained by defendants in

their motion, this limitation cannot be circumvented by artful pleading. Mot. at 17 (citing Great-

West Life & Annuity Ins. Co. v. Knudson, 534 U.S. 204, 210 (2002)). Plaintiffs’ opposition,

which attempts to disguise money damages as “account balance correction,” is little more than

artful pleading. Because plaintiffs are asking for an award of money damages under the guise of

an equitable “reconciliation,” the APA does not waive defendants’ sovereign immunity from

these claims and plaintiffs’ “trust account balance correction and wholeness” claims should be

dismissed.

Plaintiffs’ reliance on Bowen v. Massachussets, 487 U.S. 879 (1988), is misplaced.


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Opp’n at 10. Section 702 permits monetary awards only when, as in Bowen, such an award

constitutes specific relief—that is, when a court orders a defendant to pay a sum owed out of a

specific res. See generally Hubbard v. EPA, 982 F.2d 531 (D.C. Cir. 1992) (en banc) (holding

that back pay does not constitute specific relief available under APA Section 702). Here,

plaintiffs do not identify in their complaint or their opposition any appropriation from which

their “account balance correction and account wholeness” could be made. They do not seek

transfer of funds currently held in trust by defendants to their trust accounts. Instead, they seek

additional funds to be deposited in their trust accounts. The only potential source of this funding

would be the Judgment Fund under a damages award. This would constitute money damages

rather than specific relief, and so would not be authorized by Section 702. City of Houston, Tex.

v. Dep’t of Hous. and Urban Dev., 24 F.3d 1421, 1428 (D.C. Cir. 1994). Plaintiffs’ claims do

not fall within the narrow category of specific relief claims that permit monetary awards under

the APA and are outside this Court’s subject-matter jurisdiction.

2. Plaintiffs’ accounting claims should be dismissed.

Plaintiffs also seek in Count II a mandatory injunction “compelling Defendants to

perform their duty and provide Plaintiffs with complete and accurate accountings of each of

Plaintiffs’ trust accounts pursuant to accounting standards ordered by this Court.” SAC ¶ 67.

This claim should be dismissed.

First, if plaintiffs seek this injunction under 5 U.S.C. § 706(1) (to compel agency action

unlawfully withheld or unreasonably delayed), they have failed to identify discrete and

mandatory agency action, as they must. SUWA, 542 U.S. at 64. If the final agency action is

provision of the Section 4044 reports in 1996, those claims are untimely. See Section III.B.1,

supra. To the extent plaintiffs propose to wholesale challenge the Department of the Interior’s

historical accounting of tribal trust accounts for the past 190 years (see SAC ¶ 27), that is an


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impermissible programmatic challenge outside the APA’s waiver of sovereign immunity. Mot.

at 12-14 (citing, inter alia, Lujan v. Nat’l Wildlife Fed’n, 497 U.S. 871, 892-93 (1990)).

To support their argument that the accountings they seek are discrete agency actions

demanded by law, plaintiffs cite only to two unpublished district court opinions from the United

States District Court for the Western District of Oklahoma. Opp’n at 24-25. Those opinions do

not stand up to the weight of Supreme Court authority addressing this issue. Neither plaintiffs’

complaint nor their opposition make clear precisely what agency action they seek to compel.

The best that plaintiffs can do is, “give us an accounting of what you have done with our money,

and make our accounts whole if you have mismanaged it.” Opp’n at 24. Because plaintiffs

contend only that defendants “neglected [their] general statutory and regulatory obligations” to

provide them with an accounting, such conclusory allegations “amount to nothing more than

allegations of ‘general deficiencies in compliance’ that ‘lack the specificity required for agency

action.’” Mountains for Multiple Use v. Barbouletos, 568 F.3d 225, 227 (D.C. Cir. 2009)

(quoting SUWA, 542 U.S. at 66).

Second, if plaintiffs claim that the Department of the Interior has not complied with its

prospective accounting obligations set forth in Section 4011, they have not averred any facts in

their complaint to support such a claim. As discussed above, plaintiffs do not claim in their

complaint or in their opposition that the Department of the Interior has failed to provide periodic

statements of performance in the six years prior to the filing of their complaint. See Section

III.B.2, supra.

If plaintiffs seek an historical accounting under Section 4044, their claims are untimely.

If plaintiffs want a prospective accounting under Section 4011(b), they have failed to allege facts

that the Department of the Interior has failed to fulfill its obligations under that statute and, as


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such, these claims should be dismissed.

3. Plaintiffs’ record retention claim should be dismissed.

In Count II, plaintiffs also seek “mandatory injunctive relief directing Defendants to

preserve any and all documents concerning Plaintiffs’ trust accounts.” SAC ¶ 68. Plaintiffs,

though, cite no authority for the proposition that a claim for record retention is a viable cause of

action. Cobell v. Babbitt, 37 F. Supp. 2d 6 (D.D.C. 1999) (“Cobell II”), relied upon by plaintiffs,

Opp’n at 21, involved contempt proceedings against the Secretaries of the Interior and the

Treasury for failure to produce documents in discovery. See Cobell v. Norton, 240 F.3d 1081,

1093 (D.C. Cir. 2001) (“Cobell VI”). Cobell v. Norton, 229 F.R.D. 5 (D.D.C. 2005) (“Cobell

XV”), also relied upon by plaintiffs, was vacated by the District of Columbia Circuit, wherein the

Circuit disqualified the trial judge from further proceedings in Cobell. Cobell v. Kempthorne,

455 F.3d 317, 335 (D.C. Cir. 2006) (“Cobell XIX”). Neither case, therefore, supports plaintiffs’

novel contention that they may maintain an independent cause of action for record retention.

Furthermore, as explained in defendants’ opening brief, defendants’ record retention obligations

are governed by the Federal Records Act of 1950, 44 U.S.C. §§ 2901, et seq., and the Federal

Records Disposal Act, 44 U.S.C. §§ 3301, et seq. See Mot. at 18. Nowhere in plaintiffs’

complaint or in their opposition do they claim that defendants have failed to comply with these

laws.

Moreover, plaintiffs have not alleged in their complaint that defendants are failing to

preserve trust records. This is not surprising, since the district court in Cobell found that

Defendants have located and centralized 43 miles of Indian records potentially relevant to the accounting at the National Archives and the American Indian Records Repository (AIRR) in Lenexa, Kansas, . . . and they have access to another 10,000 cubic feet of MMS and United States Geological Survey (USGS) records potentially useful to those conducting the HSA accounting. . . . Problems related to the disorganized or poor condition of records were noted early in this litigation and have been addressed by defendants’ contractors at the AIRR.


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Cobell v. Kempthorne, 532 F. Supp. 2d 37, 45-46 (D.D.C. 2008) (“Cobell XX”). Because

plaintiffs have failed to allege that trust records are not being preserved, their trust records claim

should be dismissed for failure to state a claim, were it otherwise cognizable.

D. Plaintiffs’ Count III Should Be Dismissed.

Plaintiffs characterize Count III in their complaint as their “APA claims.” Opp’n at 22.

Plaintiffs aver that they have advanced two types of APA claims, failure to act claims under 5

U.S.C. § 706(1) and challenges to agency action under 5 U.S.C. § 706(2)(A). Id. at 23, 25. Both

types of claims fail.

First, to state a claim under Section 706(1), plaintiffs must identify discrete agency action

“demanded by law.” SUWA, 542 U.S. at 65. If that discrete agency action to be compelled is

compliance with Section 4044, that claim is untimely. See Section III.B.1, supra. To the extent

plaintiffs claim that defendants have failed to comply with the prospective accounting

obligations contained in 25 U.S.C. § 4011 and 25 U.S.C. § 162a within the past six years, their

complaint and opposition are bereft of any indication of what defendants allegedly failed to

provide and when defendants allegedly failed to provide it. Plaintiffs do not dispute in their

opposition that they have received periodic statements of performance within the last six years.

There are no allegations in their complaint that they have not received periodic statements of

performance within the last six years. Thus, for any timely failure to act claims, plaintiffs have

not alleged facts to state a cause of action. All of plaintiffs’ failure to act APA claims should

therefore be dismissed, either under Rule 12(b)(1) or Rule 12(b)(6).

To state a claim under Section 706(2)(A) of the APA, plaintiffs must identify “final

agency action.” 5 U.S.C. § 704. Again, if the final agency action challenged is defendants’

compliance with Section 4044 in 1996, that claim is untimely. As established in defendants’


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opening brief, plaintiffs have failed to identify any other final agency action challenged. Mot. at

12-14. In their opposition, plaintiffs simply engage in circular logic. They argue that the final

agency action challenged is inaction. Opp’n at 26 (“The agency action or inaction alleged

here―failure to provide trust accountings, correct/make whole trust accounts, and preserve trust

records―is final under the APA.”) (emphasis added). This double-speak is proof that plaintiffs

do not challenge any final agency action in their complaint.4/ Plaintiffs have failed to state a

claim under 5 U.S.C. § 706(2)(A) and their APA claims should be dismissed under Rule

12(b)(6).

Plaintiffs’ Count III should be dismissed in its entirety.

IV. CONCLUSION

As set forth in defendants’ motion and above, plaintiffs have failed to properly invoke a

waiver of sovereign immunity as to several of their claims and those claims should be dismissed

for lack of subject-matter jurisdiction. Furthermore, plaintiffs’ claims (both “nonstatutory

review” claims and APA claims) predicated on defendants’ compliance with the historical

reconciliation provisions of the 1994 Act applicable to tribal funds are untimely and should be

dismissed for lack of subject-matter jurisdiction. Finally, plaintiffs have failed to state facts that

would support a cause of action against defendants and entitle them to relief. Thus, the Court

should convert that portion of defendants’ motion to a motion under Rule 12(b)(6) and dismiss

the remainder of plaintiffs’ claims under that rule.

4 Plaintiffs’ authority for their circular logic is equally misleading. Beaty v. F.D.A., cited by plaintiffs, concerned whether the FDA’s enforcement authority was “committed to agency discretion within the meaning of the APA,” not whether it was final agency action. 853 F. Supp. 2d 30, 40 (D.D.C. 2012). Otoe-Missouria Tribe of Oklahoma v. Kempthorne, also relied upon by plaintiffs, involved a timely challenge to defendants’ compliance with Section 4044, and has no application here. No. 06-cv-1436, 2008 WL 742896 at *4 (W.D. Okla. Dec. 10, 2008).


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Respectfully submitted, May 10, 2014,

ROBERT G. DREHER Acting Assistant Attorney General /s/ Stephen R. Terrell STEPHEN R. TERRELL CA Bar No. 210004 Trial Attorney United States Department of Justice Environment & Natural Resources Division P.O. Box 7611 Washington, D.C. 20044-7611 Tel.: (202) 616-9663 Fax: (202) 305-0506 [email protected] Attorney for Defendants

Of Counsel: KENNETH DALTON GLADYS COJOCARI MICHAEL BIANCO SHANI WALKER ERICKA HOWARD R. SCOTT NUZUM United States Department of the Interior Office of the Solicitor THOMAS KEARNS REBECCA SALTIEL United States Department of the Treasury Bureau of the Fiscal Service Office of the General Counsel

CERTIFICATE OF SERVICE

I certify that, on May 10, 2014, I uploaded the attached document to the Court’s CM/ECF

system, which will cause service on all counsel of record in this matter.

/s/ Stephen R. Terrell STEPHEN R. TERRELL


for the district of columbia sisseton wahpeton oyate … · 2015-09-23 · in the united states...

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