Dunn McCampbell Royalty Interest v. Nat. Park Serv.

• Decision Date: 20 June 1995
• Docket Number: Civ.A.No. C-94-105.
• Citation: 964 F.Supp. 1125
• Parties: DUNN McCAMPBELL ROYALTY INTEREST, INC., a Texas Corporation, Dunn-Padre Corporation, a Texas Corporation and McCampbell Minerals, Inc., a Texas Corporation, Plaintiffs, v. NATIONAL PARK SERVICE, an agency of the United States Department of Interior and Butch Farabee, in his official capacity as Superintendent for the Padre Island National Seashore, Defendants.
• Court: U.S. District Court — Southern District of Texas

964 F.Supp. 1125

DUNN McCAMPBELL ROYALTY INTEREST, INC., a Texas Corporation, Dunn-Padre Corporation, a Texas Corporation and McCampbell Minerals, Inc., a Texas Corporation, Plaintiffs, v. NATIONAL PARK SERVICE, an agency of the United States Department of Interior and Butch Farabee, in his official capacity as Superintendent for the Padre Island National Seashore, Defendants.

Civ.A.No. C-94-105.

United States District Court, S.D. Texas. Corpus Christi Division.

June 20, 1995.

COPYRIGHT MATERIAL OMITTED

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Dick Watt, Houston, TX, for plaintiffs.

Larry C. Marcy, U.S. Attorneys Office, Houston, TX, Charles Wendlandt, Jr., Office of U.S. Attorney, Corpus Christi, TX, for defendants.

ORDER ON PLAINTIFFS' MOTION FOR SUMMARY JUDGMENT, DEFENDANTS' CROSS-MOTION FOR SUMMARY JUDGMENT, DEFENDANTS' MOTION TO DISMISS TAKINGS CLAIM AND PLAINTIFFS' ORAL MOTION TO SEVER TAKINGS CLAIM

JACK, District Judge.

On June 9, 1995, came on to be heard: (1) Plaintiffs Dunn-McCampbell Royalty Interest, Inc.'s, Dunn-Padre Corporation's and McCampbell Minerals, Inc.'s Motion for Summary Judgment against Defendants National Park Service and Butch Farabee in his official capacity as Superintendent for the Padre Island National Seashore (Butch Farabee); (2) Defendants National Park Service's and Butch Farabee's Cross-Motion for Summary Judgement against Plaintiffs Dunn-McCampbell Royalty Interest, Inc., Dunn-Padre Corporation and McCampbell Minerals, Inc.; (3) Defendants National Park Service's and Butch Farabee's Motion to Dismiss Takings Claim against Plaintiffs Dunn-McCampbell Royalty Interest, Inc., Dunn-Padre Corporation and McCampbell Minerals, Inc.; and (4) Plaintiffs Dunn-McCampbell Royalty Interest, Inc.'s, Dunn-Padre Corporation's and McCampbell Minerals, Inc.'s Oral Motion to Sever Takings Claim against Defendants National Park Service and Butch Farabee.

I. JURISDICTION

Plaintiffs filed this action in federal district court pursuant to federal question jurisdiction under 28 U.S.C. § 1331. Additionally Plaintiffs sought jurisdiction under the Quiet Title Act, 28 U.S.C. § 2409a, the Mandamus Act, 28 U.S.C. 1361 et seq. and the Administrative Procedures Act, 5 U.S.C. § 702, et seq. For the reasons stated herein: (1) the Court DENIES Plaintiffs' Motion for Summary Judgment; (2) the Court GRANTS Defendants' Motion for Summary Judgment; (3) the Court DENIES Defendants' Motion to Dismiss Takings Claim; and (4) the Court GRANTS Plaintiffs' Oral Motion to Sever Takings Claim.

II. LEGISLATIVE HISTORY

1. National Park Service Organic Act

In 1916, exercising its power under the Property Clause, Const. Art. IV, ¶ 3, cl. 2, Congress established the National Park System by enacting the National Park Service Organic Act. 16 U.S.C. § 1 et seq. Section 1 of the Organic Act states the purpose of the National Park system is to:

conserve the scenery and the natural and historic objects and the wild life therein and to provide for the enjoyment of the same in such manner and by such means as will leave them unimpaired for the enjoyment of future generations.

16 U.S.C. § 1.

In addition to the units originally included within the National Park System, the Secretary of the Interior (Secretary) is directed to review other areas that "exhibit qualities of national significance" for inclusion within the National Park System and report to Congress. 16 U.S.C. § 1a-5. Congress then determines whether a candidate area is designated as a unit of the National Park Service. Id.

2. Padre Island National Seashore Enabling Legislation

In 1962, pursuant to the Property Clause and in accordance with the Park Service's Organic Act, Congress enacted the Padre Island National Seashore Enabling Legislation (Padre Enabling Act), 16 U.S.C. § 459d et seq., thereby establishing a national park at the Padre Island National Seashore. The Padre Enabling Act authorized the Secretary of the Interior to acquire interests in property, 16 U.S.C. § 459d-1, and required the Secretary to administer those interests in light of the objectives established under the Organic Act. 16 U.S.C. § 459d-4.

3. Texas Consent Statute

On April 4, 1963, both houses of the Texas legislature passed the Texas Consent Statute (TCS). Tex.Civ.Stat.Ann. § 6077t (Vernon 1970). The TCS codified the boundaries of the Padre Island National Seashore (National Seashore) and granted the United States permission to acquire the State owned surface estate. The TCS specifically required concurrent jurisdiction over all civil and criminal process, the right to levy and collect taxes and the right to vote. Additionally, the TCS granted consent to the United States to purchase privately held portions of the surface estate, provided such purchases would not deprive the grantor, or successor in title, the right of ingress and egress to the mineral estate. In consideration of the State's conveyance of its surface estate, the United States agreed to "establish and maintain the land ... as a National Seashore area." Id.

4. 9B Regulations

In 1979, pursuant to the Organic Act, the Secretary promulgated regulations applicable to nonfederally owned oil and gas operations in all National Park System units that require access on or through federally owned or controlled lands or waters (the 9B Regulations). 36 C.F.R. § 9.36(a). The critical component of the 9B Regulations is the requirement that an operator obtain Park Service approval of a plan of operations before commencing oil and gas exploration or production activities. 36 C.F.R. § 9.36.¹ Operators are responsible for preparing a plan of operations that addresses all information requirements applicable to proposed operations.

Operators are required to supply this information in sufficient detail to enable the Park Service to effectively analyze the impact of proposed operations on the particular unit's resources, and to determine whether to approve the proposed plan. 36 C.F.R. § 9.36(c). The Park Superintendent's or Regional Director's adequacy determination is administratively appealable. 36 C.F.R. § 9.49.

III. FACTS

P.F. Dunn, Plaintiffs' predecessor in title, originally owned much of the land that is now the Padre Island National Seashore. In 1926, P.F. Dunn conveyed the surface estate to third parties, reserving the oil, gas and other mineral estates (mineral estate). Plaintiffs, or their predecessors in title, have owned this mineral estate since the 1926 conveyance.

Plaintiffs argue Defendants do not have the constitutional power and/or authority to regulate access to their mineral estate. Plaintiffs assert Texas law, rather than federal law, governs their mineral estate and that under Texas law the mineral estate is dominant to the surface estate. In so arguing, Plaintiffs contend the Padre Enabling Act and the Texas Consent Statute specifically preclude federal regulation of their mineral estate. Additionally, Plaintiffs contend case law supports their position that federal law does not preempt application of state law to their mineral estate.

Plaintiffs claim that due to the "onerous" compliance requirements of the 9B Regulations, oil companies refuse to enter leases for Plaintiffs' mineral estate on the National Seashore. However, Defendants contend they have the right to reasonably regulate the federally owned surface estate. Defendants rely upon the Property Clause, National Park Service Organic Act and Supremacy Clause to argue promulgation and application of the 9B Regulations to Plaintiffs' mineral estate is constitutionally valid. Moreover, Defendants argue Plaintiffs' complaint is procedurally inadequate.

Plaintiffs seek a declaratory judgment that Defendants have no authority to regulate or otherwise restrain access to Plaintiffs' mineral estate. In the alternative, if the Court determines Defendants have the power and authority to regulate Plaintiffs' access to their mineral estate, Plaintiffs seek a judgment that such regulation constitutes a taking under the Fifth Amendment of the United States Constitution, entitling Plaintiffs to just compensation.

Plaintiffs and Defendants both move for summary judgment. Additionally, Defendants move to dismiss Plaintiffs' takings claim, arguing this Court has no jurisdiction over said claim pursuant to the Tucker Act, 28 U.S.C. §§ 1346(a)(2) and 1491(a).

IV. DISCUSSION

To succeed in a motion for summary judgment, the movant must show there is no genuine issue of material fact and that the movant is entitled to judgment as a matter of law. Fontenot v. Upjohn Co., 780 F.2d 1190, 1195 (5th Cir.1986). This Court must view all inferences from the summary judgment evidence in the light most favorable to the non-movant. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S.Ct. 2505, 2513, 91 L.Ed.2d 202 (1986).

1. PROCEDURAL CONSIDERATIONS

(a) Standing

To establish standing Plaintiffs must make a three-fold showing that: (1) they have suffered some actual or threatened injury as the result of the putatively illegal conduct of Defendants; (2) the injury fairly can be traceable to the challenged action; and (3) the injury is likely to be redressed by a favorable decision. Giddings v. Chandler, 979 F.2d 1104, 1108 (5th Cir.1992). See also, Valley Forge Christian College v. Americans United for Separation of Church & State, Inc., 454 U.S. 464, 472, 102 S.Ct. 752, 758, 70 L.Ed.2d 700, (1982), Gladstone, Realtors v. Village of Bellwood, 441 U.S. 91, 99, 99 S.Ct. 1601, 1608, 60 L.Ed.2d 66 (1979), Simon v. Eastern Kentucky Welfare Rights Org., 426 U.S. 26, 38, 41, 96 S.Ct. 1917, 1924, 1925, 48 L.Ed.2d 450 (1976).

Defendants argue Plaintiffs lack standing because Plaintiffs have pled only a "chilling effect" on potential leasing activities. Plaintiffs have never been denied a permit under the 9B Regulations, nor have Plaintiffs attempted to have a plan of operations approved under the 9B Regulations. In fact, it is uncontroverted that no plan of operations has ever been...