Kingman Reef Atoll Investments v. U.S., Civil No. 05-00151 JMS/BMK.

• Decision Date: 27 August 2007
• Docket Number: Civil No. 05-00151 JMS/BMK.
• Citation: 545 F.Supp.2d 1103
• Parties: KINGMAN REEF ATOLL INVESMENTS, L.L.C., a Hawaii limited liability company, Plaintiff, v. The UNITED STATES of America; The United States Department of the Interior; Gale A. Norton, in her official capacity as Secretary of the Interior; The United States Fish and Wildlife Service; Matthew Hogan, in his official capacity as Director of United States Fish and Wildlife Service; John Does 1-10, Jane Does 1-10, and Doe Partnerships, Corporations, Governmental Units or Other Entities 1-10, Defendants.
• Court: U.S. District Court — District of Hawaii

545 F.Supp.2d 1103 KINGMAN REEF ATOLL INVESMENTS, L.L.C., a Hawaii limited liability company, Plaintiff,
v.
The UNITED STATES of America; The United States Department of the Interior; Gale A. Norton, in her official capacity as Secretary of the Interior; The United States Fish and Wildlife Service; Matthew Hogan, in his official capacity as Director of United States Fish and Wildlife Service; John Does 1-10, Jane Does 1-10, and Doe Partnerships, Corporations, Governmental Units or Other Entities 1-10, Defendants. Civil No. 05-00151 JMS/BMK. United States District Court, D. Hawai`i. August 27, 2007.

Page 1104

Christian P. Porter, Donna H. Yamamoto, Brooks Tom Porter & Quitiquit, Honolulu, HI, David W.H. Chee, Wahiawa, HI, Michael M. Ching, Therese Y. Cannata, Cannata Ching & O'Toole LLP, San Francisco, CA, for Plaintiff.

Donna S. Fitzgerald, U.S. Department of Justice, Environment & Natural Resources Division, Washington, DC, Thomas A. Helper, Office of the United States Attorney, Honolulu, HI, for Defendants.

ORDER GRANTING DEFENDANTS' MOTION TO DISMISS, OR, IN THE ALTERNATIVE, FOR SUMMARY JUDGMENT

J. MICHAEL SEABRIGHT, United States District Judge.

I. INTRODUCTION

The United States of America, the United States Department of the Interior, Gale

Page 1105

Norton in her official capacity as Secretary of the Interior, the United States Fish and Wildlife Service ("FWS"), and Matthew Hogan in his official capacity as Director of FWS (collectively, "Defendants") move to dismiss this action pursuant to Federal Rule of Civil Procedure 12(b)(1) for lack of subject matter jurisdiction and Rule 12(b)(6) for failure to state a claim. In the alternative, Defendants move for summary judgment pursuant to Rule 56(b). Plaintiff Kingman Reef Atoll Investments, L.L.C. ("Plaintiff) filed this action under the federal Quiet Title Act ("QTA"), 28 U.S.C. § 2409a, seeking to quiet title to Kingman Reef Atoll.¹ Defendants argue that Plaintiffs claim is time-barred by the QTA's 12-year statute of limitations, and that as a result, this court lacks jurisdiction to hear Plaintiffs claim. Based on the following, the court GRANTS Defendants' motion to dismiss for lack of subject matter jurisdiction.

II. BACKGROUND

A. Factual Background

Kingman Reef is a low-lying, coral reef atoll comprised of small emergent land spits and partially exposed coral reefs that surround a deep central lagoon, located approximately 930 miles south of Honolulu, Hawaii. The atoll, whose nearest neighbor is Palmyra, is not suitable for human habitation. In 2001, it was designated as a National Wildlife Refuge managed by FWS within the Department of the Interior.

1. The Fullard-Leo Family's Claim to Kingman Reef Atoll (1922)

The first western contact at Kingman Reef was reportedly by Captain Edmund Fanning in 1798 and later by Captain W.E. Kingman in 1853. In 1922, Lorrin A. Thurston claimed Kingman Reef in the name of the United States for his employer, the Island of Palmyra Copra Company, a corporation under the laws of the Territory of Hawaii. Leslie Fullard-Leo was the Island of Palmyra Copra Company's president and Ellen Fullard-Leo was its secretary and treasurer. Plaintiff Kingman Reef Atoll Investments, L.L.C. is managed by members of the Fullard-Leo family and claims title to Kingman Reef.

2. Executive Orders (1934 and 1941)

On December 29, 1934, President Roosevelt issued Executive Order 6935, which placed several islands in the Pacific Ocean under the control and jurisdiction of the Secretary of the Navy. The Executive Order states in part:

By virtue of and pursuant to the authority vested in me by the act of June 25, 1910, ch. 421, 36 Stat. 847, as amended by the act of August 24, 1912, ch. 309, 37 Stat. 497, and as President of the United States, it is ordered that ... Kingman Reef located in the Pacific Ocean ... together with the reefs surrounding all the aforesaid islands, as indicated upon the diagram hereto attached and made a part of this order, be, and they are hereby, reserved, set aside, and placed under the control and jurisdiction of the Secretary of the Navy for administrative purposes[.]

This order shall continue in full force and effect unless and until revoked by the President or by act of Congress.

Executive Order 6935, see App. A. The authorizing legislation of 1910 referenced in the Executive Order, the Pickett Act, states in part:

That the President may, at any time in his discretion, temporarily withdraw from settlement, location, sale, or entry

Page 1106

any of the public lands of the United States[²] ... and reserve the same for water-power sites, irrigation, classification of lands, or other public purposes to be specified in the orders of withdrawals, and such withdrawals or reservations shall remain in force until revoked by him or by an Act of Congress.

Pickett Act of June 25, 1910, Chapter 421, 36 Stat. 847. Although the Pickett Act was repealed by the Federal Land Policy and Management Act of 1976, Pub.L. No 94-579, 704(a), 90 Stat. 2792, all previous withdrawals and reservations under the Picket Act were expressly preserved and "remain in full force and effect until modified under the provisions of this Act or other applicable law." 701(c), 90 Stat. 2786.

Executive Orders 8682³ and 8729,⁴ issued in 1941, established a Naval Defensive Sea Area ("NDSA") and Naval Airspace Reservation over several Pacific islands, including Kingman Reef. None of the three Executive Orders has been revoked and the Navy maintains control and jurisdiction over Kingman Reef under existing regulations. See 32 C.F.R. § 761.3(a)(2)(v) & (b)(2) (2006) (Kingman Reef and Kingman Reef NDSA identified as under Navy authority).

3. Use and Control of Kingman Reef from 1934 to 2000

On April 20, 1937, Leslie and Ellen Fullard-Leo wrote to Samuel Wilder King, Hawaii's Delegate to Congress, indicating that the Fullard-Leos believed the State Department or Navy Department owned Kingman Reef, but that they were entitled to compensation for annexing the atoll. Regarding Kingman Reef, the Fullard-Leos stated:

Its ownership presumably rests with the State or Navy Department, since by one of these, use of it has been given to the Pan-American Airways, and has on two occasions been used during their trial flight this month to Auckland, N.Z.

. . . .

In annexing Kingman's Reef it was necessary to send our boat there three times — the cost of this together with taxes and accrued interest over a period of fifteen years lead us to believe that

Page 1107

we are entitled to compensation in the sum of forty thousand dollars.

Defs.' Ex. 7, see App. B. King then received a letter from Claude" A. Swanson, Secretary of the Navy, on May 29, 1937, which references the 1934 Executive Order and states: "The records of the Navy Department do not indicate that there were any vested rights on Kingman Reef in favor of private interests on the date of the issuance of this Executive Order[,]" Pl's. Ex. N-2, Ainsley Fullard-Leo Decl.

On March 29, 1938, attorneys for the Fullard-Leos wrote to the Secretary of the Navy, acknowledging that the government denied the existence of any private property rights in Kingman Reef based on the 1934 Executive Order. The letter from attorneys Townsend and Lewis states:

As indicated in our letter of January 25th to the Secretary of State, it would seem that, as a result of the Executive Order of December 29, 1934, the Secretary of the Navy apparently concluded that the Department of State had denied the existence of the private property interests in Kingman's Reef claimed by Mrs. Ellen Fullard-Leo.... It seems unnecessary to restate the costs incurred by Mrs. Fullard-Leo in connection with the annexation of Kingman's Reef for and in behalf of the United States, or to recount the steps taken by her to establish her presently existing legal rights to the private property interests in the atoll.

Defs'. Ex. 8, see App. C. The Navy responded in an April 26, 1938 letter to Townsend and Lewis, rejecting the `Fullard-Leos' claim to any interest in Kingman Reef:

Reference is made to your letter of March 29, 1938, addressed to the Secretary of the Navy with respect to the alleged interests of Mrs. Ellen Fullard-Leo in the Island known as Kingman Reef located in the Pacific Ocean approximately thirty-three miles northwest of the Palmyra Islands and about 930 miles south of Honolulu.

. . .

The records show that Kingman Reef ... is a bonded guano island, it having been listed by affidavit of Captain W.W. Taylor on February 12, 1858, and his rights, through several assignments, were transferred to the United States Guano Company, and the island was bonded on February 8, 1860[.]

It will be noted that the island, including its reefs and tide and submerged lands, was under the control and jurisdiction of the United States long before the claim of Mrs. Fullard-Leo arose, and by Executive Order No. 6935, dated December 29, 1934, it was placed under the control and jurisdiction of the Navy Department. Under the circumstances, the showing made is not sufficient to uphold the claim of Mrs. Fullard-Leo.

Defs.' Ex. 9, see App. D. Following this rejection of their claim to Kingman Reef, the Fullard-Leos did not challenge the 1934 Executive Order or seek to quiet title to Kingman Reef. Throughout the years, the Navy handled requests for access to Kingman Reefs waters and airspace. See Defs.' Exs. 15-26. Permission to enter the Kingman Reef NDSA is granted by an "Entry Control Commander" at Pearl Harbor. See 32 C.F.R. § 761.9; Defs.' Ex. 9.

The Fullard-Leo family, primarily through its agent Peter Savio, also received requests and granted permission to access Kingman Reef. See Savio Decl. 6-7; Austin Decl. 2. Plaintiff claims that private citizens, as well as members of the federal, state, and local governments, treated Plaintiff and its predecessor-in-interest as the owner of Kingman Reef. See Pl's. Exs.

Page 1108

D, G, Porter...