Free Order on Motion for Miscellaneous Relief - District Court of Federal Claims - federal

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In the United States Court of Federal Claims
No. 93-648X Filed: April 18, 2008 TO BE PUBLISHED ************************************* * LAND GRANTORS IN HENDERSON, * Class Action; UNION, and WEBSTER COUNTIES, * Congressional Reference, 28 U.S.C. § 2509; KENTUCKY and THEIR HEIRS, * Estimated Damages; * Interest On Claims Against Government, Claimants, * 28 U.S.C. § 2516(a); * "Lost Use" Value; v. * Mutual Mistake; * RESTATEMENT (SECOND ) OF CONTRACTS §§ * 152, 154(a), (c), 158(1), 352(a), 384; THE UNITED STATES, * RESTATEMENT (FIRST ) OF RESTITUTION §§ * 1, 157(1)(a); Defendant. * Restitution; * Unjust Enrichment. * ************************************* Nancie G. Marzulla and Roger J. Marzulla, Marzulla & Marzulla, Washington, D.C., Mark Stephen Pitt, Wyatt, Tarrant & Combs, LLP, Louisville, Kentucky, for Claimants. William James Shapiro, United States Department of Justice, Sacramento, California, for Defendant. FINAL REPORT AND MEMORANDUM OPINION REGARDING S. 794, "A BILL FOR THE RELIEF OF LAND GRANTORS IN HENDERSON, UNION, AND WEBSTER COUNTIES, KENTUCKY, AND THEIR HEIRS."1 Reports and Memorandum Opinions previously issued in this congressional reference by the undersigned are incorporated herein: Land Grantors v. United States, 64 Fed. Cl. 661 (2005) ("Land Grantors I") (determining that the 1942-1944 contracts were based on a mutual mistake); Land Grantors v. United States, 71 Fed. Cl. 614 (2006) ("Land Grantors II") (granting Claimants' Motion for Class Certification and appointing the law firm Marzulla & Marzulla as Class Co-Counsel); Land Grantors v. United States, 74 Fed. Cl. 518 (2006) ("Land Grantors III") (determining that the interests of justice required deferral of a final disposition until the en banc decision in Kirkendall v. Dep't of the Army, 412 F.3d 1273, 1275-78 (Fed. Cir. 2005) (holding that the presumption of equitable tolling applied to Veterans Employment Opportunity Act claims) was decided en banc and was final and requesting views of parties regarding mediation); Land Grantors v. United States, 77 Fed. Cl. 686 (2007) ("Land Grantors IV") (denying the Government's objection to filing of Claimants' Second Amended Complaint, but granting the Government's
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BRADEN, Judge and Hearing Officer. Following the onset of World War II, the United States ("Government") acquired, pursuant to the War Purposes Act of 1917, 40 Stat. 241 (codified as amended at 50 U.S.C. § 171) (repealed 1956) ("War Purposes Act"), approximately 35,849.28 acres of land in the counties of Henderson, Union, and Webster, Kentucky, to establish an Army training facility that was named Camp Breckinridge. Almost all of this property: was owned by farmers who resided on their land; had been in the same families for generations; and constituted the entirety of these families' livelihood. On February 4, 1942, the Department of War authorized the first of five subsequent condemnation petitions, filed during 1942-1944 in the United States District Court for the Western District of Kentucky. Once these properties were condemned, the owners either could voluntarily negotiate a sale price and contract with federal agents or demand a jury trial to determine the amount of "just compensation" that the Government should pay for the appropriation of their land. At the end of this process, the Government ultimately paid the landowners approximately $3.7 million for their property, whether it was purchased under contract or conveyed under judicial order. A decade after World War II was over, the Government began to lease and sell all the coal, gas, oil, and other mineral rights discovered under the former landowners' properties, that ultimately generated tens of millions of dollars of revenue. In 1968, after the appeal of a failed lawsuit was exhausted, the landowners turned to Congress for help. Twenty five years later, "a bill for the relief of land grantors in Henderson, Union, and Webster Counties, Kentucky, and their heirs," was enacted. This bill recognized the basic injustice of the Government's actions and allowed the landowners to pursue their claims in the United States Court of Federal Claims. See S. 794, 103d Cong. (1993). On January 12, 1994, a Complaint was filed and assigned to another judge. Intermittent settlement negotiations and discovery disputes ensued for over a decade.2 On August 15, 2003, this case was transferred to the undersigned. On September 8-10, 2004 and November 23, 2004, an evidentiary hearing and trial was held. On April 1, 2005, an Interim Report And Memorandum Opinion was issued, that found any representations that the Government employees or agents may have made about Claimants' ability to repurchase their land after World War II were unauthorized and therefore did not contractually bind the Government. See Land Grantors I, 64 Fed. Cl. at 70304. The April 1, 2005 Interim Report And Memorandum Opinion, however, also found that the 1942-1944 contracts conveying the landowners' property to the Government were based on a mutual mistake that no coal, gas, oil, or other mineral deposits existed under the condemned properties at that time that would support exploration or operation. Id. at 703-08. Therefore, restitution was

request to file a Motion To Dismiss in Case No. 93-6481L); and Land Grantors v. United States, 80 Fed. Cl. 196 (2008) ("Land Grantors V") (dismissing Case No. 93-6481L, as barred by 28 U.S.C. § 2501). An overview of the procedural history between 1994 and August 15, 2003, is set forth in Land Grantors I, 64 Fed. Cl. at 685-89. 2
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required, because Claimants were "paid less than reasonable value due in part to the refusal of the United States Government to compensate the owners for mineral, oil and gas rights." S. 794, § 2(2); see also Land Grantors I, 64 Fed. Cl. at 666, 691. After trial, Claimants amended their Complaint, pursuant to RCFC 15(b), to conform to evidence adduced at trial by adding a legal claim under the Tucker Act, 28 U.S.C. § 1491 and renewing their equitable claim under 28 U.S.C. § 2509. Subsequently, considerable effort was undertaken to ascertain the amount of revenues that the Government received for the lease and sale of the coal, gas, oil, or other mineral interests at issue. It appears, however, that the Government destroyed and/or misplaced many of the documents that would verify the proper amount of restitution owed to Claimants, even during the period that this reference was pending. For this and other reasons, Justice Sandra Day O'Connor agreed to be appointed as a Mediator to assist the parties in reaching a settlement. Unfortunately, those efforts were unsuccessful. A few months later, Claimants' ability to continue pursuing a legal claim was extinguished. See John R. Sand & Gravel Co. v. United States, 128 S. Ct. 750, 753 (2008) ("forbidding a court to consider whether certain equitable considerations warrant extending a limitations period"). Nevertheless, for the reasons discussed herein, the record provides substantial evidence to support Claimants' entitlement to the equitable remedy of restitution, at least in the amount of $34,303,980.42. To facilitate panel and congressional review of this Final Report and Memorandum Opinion, the following outline is set forth: I. RELEVANT FACTUAL BACKGROUND. A. Condemnation Proceedings During 1942-1944. 1. 2. The February 1942 Condemnation Of 10,427.70 Acres In Union County. The March 1942 Condemnation Of 19,517 Acres In Union And Henderson Counties. The June 1942 Condemnation Of 824 Acres In Union County. The October 1942 Condemnation Of 5,400 Acres In Webster County. The January 1943 Condemnation Of 280 Acres. The May 1943 Condemnation Of 9.4 Acres In Union County. The May 1944 Condemnation Of 16.37 Acres In Union County.

3. 4. 5. 6. 7. B.

Disposition Of Waller Young Property In 1957.

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C.

The Department Of The Interior's 1956 Discovery Of Oil And Issuance Of Oil And Gas Leases in 1957 And 1959. The Closure and Disposition Of Camp Breckinridge. 1. 2. The Sale Of Coal, Gas, Oil, And Other Mineral Rights In 1965. The Sale Of Coal Rights In 1967. a.) b.) c.) Tract No. 1. Tract No. 7A. Tract No. 7B.

D.

E. II. III.

The Enactment Of S. 794 In 1993.

RELEVANT PROCEDURAL HISTORY. DISCUSSION. A. B. C. D. Jurisdiction. Standing. Standard of Review. Claimants' Agreement To Sell Their Land In 1942-1944 Was Based On A Mutual Mistake. 1. The "Basic Assumption" On Which The Claimants Agreed To Sell Their Land Was That No Coal, Gas, Oil, Or Other Mineral Deposits Existed Under The Condemned Properties In 1942-1944 That Would Support Exploration Or Operation. The "Basic Assumption" Had A "Material Effect" On The Agreed Exchange Of Performance. Claimants Should Not Bear Risk Of The Mutual Mistake.

2.

3. E.

The Remedy For Mutual Mistake Is Restitution, Measured By The Government's Enrichment From The Lease And Sale Of The Coal, Gas, Oil, Or Other Mineral Deposits. 4

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F.

The Recommended Amount Of Restitution Due. 1. The Undisputed Amount Of Revenues Received By The Government For The Lease Or Sale Of Coal, Gas, Oil, Or Other Mineral Deposits That Existed Under The Condemned Properties In 1942-1944. Claimants' Estimate Of Royalties Derived From Tracts 7A And 7B From 1964-1983 And 1983-2006 Is Not "Reasonably Certain." Claimants' Estimate Of Royalties Derived From Seams #9 And #11 From TVA Coal Leases And Easements Is Not "Reasonably Certain."

2.

3.

G.

Claimants' March 6, 2008 Motion To Vacate The November 24, 1998 Order Is Granted, In Part. Claimants' March 6, 2008 Request To Modify Proposed Class Is Denied. Claimants Are Entitled To Reasonable Attorneys Fees, Reasonable Expenses And Costs.

H. I.

IV.

CONCLUSION. * * *

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I.

RELEVANT FACTUAL BACKGROUND.3 A. Condemnation Proceedings During 1942-1944.

Early in 1942, Congressman Benjamin Vincent announced that the Government decided to condemn and take immediate possession of 10,470 acres in Union County, Kentucky and that federal negotiators would begin meeting with property owners to negotiate voluntary sales. Therefore, Government agents advised the public that: Farmers who are not satisfied with land prices will have the opportunity to appeal their case but will have to move from their homes during the litigation period. Part of the purchase money will be available to them during the period. DX 182 at DOJ1933-34 (Cantonment Families Get 13-Day Notices, HENDERSON GLEANER ­JOURNAL, Jan. 30, 1942, at 1, 8). 1. The February 1942 Condemnation Of 10,427.70 Acres In Union County.

On February 4, 1942, the Adjutant General's Office of the Department of War issued a directive to the Under Secretary that there was a "military necessity for the acquisition of lands to provide cantonment building areas for triangular divisions and other troops" at Morganfield, Kentucky of approximately 10,427 acres, which was estimated to cost $1,011,723. See JX 13; see also JX 14; JX 22. This land was to be "acquired by such methods as [were] to the best interests of the United States in accordance with the policies outlined [by the Department of War's Adjutant General's Office] February 7, 1942, AG 601.1 (1-21-42) MO-D-M, Subject: War Department Real Estate Policy." JX 14. On February 14, 1942, the local U.S. District Attorney filed the first Petition, pursuant to the War Purposes Act, condemning 10,427.70 acres in Union County, Kentucky. On February 16, 1942, Deputy U.S. Marshal O. A. Denton served the first of 121 Orders to Vacate 99 condemned tracts of land. See United States v. 10,427.70 Acres Situated in Union County, Kentucky, No. 74 (W.D. Ky. filed Feb. 14, 1942); see also DX 182 at DOJ2075, 2079, 2085 (Condemn 10,427.70 Acres; Will Include 20,000 More, UNION COUNTY ADVOCATE , Feb. 19, 1942; Over Half of Cantonment Area Acquired, Manager Says, UNION COUNTY ADVOCATE , Feb. 26, 1942; Between 3 and 4 Hundred Tracts in Second Area, UNION COUNTY ADVOCATE , Mar. 4, 1942). Thereafter, each of the landowners was visited by a member of the Corps of Engineers' Negotiating Team led by: Willard Ewing, Land Acquisition Manager, from Cincinnati, Ohio; J. M. Canary, Chief Negotiator, from

A complete statement of facts was set forth in Land Grantors I, 64 Fed. Cl. at 666-86. For the convenience of congressional and panel review, a substantial portion of those facts are re-stated herein. 6

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Hardinsburg, Kentucky;4 Sterling Towles from Danville, Kentucky;5 and Cosby Campbell from Dixon, Kentucky. The landowners and their families were given until March 3, 1942 to vacate their property so that construction could begin by March 15, 1942. According to contemporaneous press accounts, this effort was not met with opposition. See DX 182 at DOJ2075, 2079, 2085 (Condemn 10,427.70 Acres; Will Include 20,000 More, UNION COUNTY ADVOCATE , Feb. 19, 1942; Over Half of Cantonment Area Acquired, Manager Says, UNION COUNTY ADVOCATE , Feb. 26, 1942; Between 3 and 4 Hundred Tracts in Second Area, UNION COUNTY ADVOCATE , Mar. 4, 1942). Approximately 85% of the owners of the 10,427.70 acres in Union County agreed to voluntary sales and to deliver to the United States "a general warranty deed conveying said land to the United States of America in fee simple, free from all encumbrances" for $1 and at the price offered by the Government land appraisal, to be paid when the United States exercised an option that would expire within 3 months." The other 15% of owners were settled after federal condemnation proceedings were initiated. See generally JX 205-536H. By the beginning of December 1942, the Government negotiated a "moratorium" with the oil companies that had leases with the former landowners. See DX 627 (Dec. 4, 1942 letter of Eli H. Brown, Jr., United States Attorney, Western District of Kentucky). The oil companies were advised "they will not be entitled to exercise any of their rights under their leases for the duration of the war [but after] the war they will be entitled to exercise these rights." Id. 2. The March 1942 Condemnation Of 19,517 Acres In Union And Henderson Counties.

On March 7, 1942, the Adjutant General's Office notified the Under Secretary of War that military necessity required the acquisition of approximately 29,945 acres (including the 10,427.70 acres subject to the February 4, 1942 condemnation action) in the Morganfield area. The amount paid to the landowners subject to the February 4, 1942 and March 7, 1942 condemnations was estimated at $2,927,360. See JX 14; JX 22 at DOJ1349. On March 31, 1942, the local U.S. District

A June 10, 1942 Report of Efficiency Rating for Chief Negotiator James M. Canary for the period January 22, 1942 to March 31, 1942 was "unsatisfactory," because his conduct "showed partiality in government dealings with public, used threatening & abusive methods of doing business, respectful to those of wealth and education, exceedingly abusive of ignorant & poverty stricken." DX 261 at PER0322-23. Canary's February 4, 1943 Report of Efficiency Rating for the period April 1, 1942­May 25, 1942 also was "unsatisfactory," because "as negotiator he used duress and threatening tactics." DX 261 at PER0324-25; see also CX 122 (May 25, 1979 J. Sterling Towles Aff. (former negotiator stated that "government negotiators were instructed by their superiors that if the property owners questioned whether or not they would be able to repurchase the property they were to be told that they would have the first option to repurchase the property after the war.")).
5

4

See supra note 4. 7

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Attorney filed a second petition under the War Purposes Act condemning 19,517 acres located in Union and Henderson counties. See United States v. 19,517 Acres Situated in Union and Henderson Counties, No. 77 (W.D. Ky., filed Mar. 31, 1942). On April 2, 1942, the Cantonment area at Morganfield, Kentucky was named Camp Breckinridge. See JX 16. On that date, the second group of landowners were served with notices to vacate their properties by May 18, 1942. This event sparked a protest and meeting of the landowners that took place on August 14, 1942. One of the major concerns expressed was that land prices escalated after the Government initiated the first condemnation, making it difficult for the landowners to purchase new farms in the area at the appraisal prices being offered by the Government. Over 80 landowners signed a petition stating that the Government appraisals amounted to only 50% of their properties' value, precluding their ability to purchase suitable replacement property. On April 22, 1942, a Petition was sent to President Roosevelt stating: We have been faced at every turn with the "take it or leave it" proposition insofar as compensation is concerned and we have been afforded no opportunity to make any speedy adjustment with the Government for a reasonable compensation for our lands. . . . We are being told in many instances by representatives of the Federal Government, that unless we accept the unreasonable offers being made by representatives of the Government as compensation for the lands we are being deprived of, that it will be years before we will be able to obtain any compensation for the property from which we have been dispossessed. In many instances, we are unable to go to the expense of getting our claims adjusted in the Courts and we think that it is unreasonable that we should be required to do so. DX 182 at DOJ2376-77; see also DX 69 at DOJ1301. The Department of the Army was charged with investigating the Petition. After an initial investigation, a public meeting was convened in Morganfield on May 14, 1942, attended by Captain Robert C. Tyler, Ohio River Division's Chief Counsel, where a majority of the landowners expressed continued dissatisfaction with the prices being offered, despite the fact that many had sold their land to the Government at a negotiated price, rather than insisting on a jury determination. Captain Tyler advised the landowners that the Department of War was concerned about learning that high pressure methods had been used to persuade some owners to sell their property.6 Nevertheless, by May 21, 1942, over half of the landowners in the second condemnation agreed to sell at negotiated prices.

6

See supra note 4. 8

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Based on the results of the Tyler/Harmon Report, on May 23, 1942, President Roosevelt sent a letter to the landowners that was published in the local newspaper, advising: You are advised that the War Department has investigated the situation at Morganfield and reports that the appraisers assigned to the task of making impartial, unbiased appraisals for the properties being acquired were carefully selected and are believed to be eminently qualified to determine real estate values in that particular location. The appraisals have been carefully reviewed by appraisal supervisors who state that the values placed on the properties are liberal and in line with present economic conditions in the community. The fact that approximately 70% of the landowners in the entire area have now voluntarily agreed to convey their property to the government at prices based upon the appraisals appears to confirm that view. As you are aware, no citizen is required to give an option to the Government at a price which does not meet with his or her approval. In any instance where the owner does not desire to execute an option, the War Department acquires such property through condemnation proceedings, in which event the amount of the estimated compensation will be deposited in the Registry of the Federal Court, and may be withdrawn by the owner under a Court Order without prejudice to his right to contest for a higher valuation. DX 183A at DOJ3355. On June 29, 1942, the Secretary of War filed Declaration of Takings No. 1 to acquire 5,004.97 acres in fee simple and deposited $312,239.00 into the Registry of the United States District Court for the Western District of Kentucky ("Registry") to compensate landowners who sold their property to the Government at a negotiated price, as a result of the condemnation in United States v. 19,517.30 Acres. See JX 264A-B. 3. The June 1942 Condemnation Of 824 Acres In Union County.

On June 9, 1942, the Adjutant General's Office notified the Under Secretary of War that a military necessity existed for the acquisition of 824 acres at an estimated cost of $80,600. See JX 22 at DOJ1349. On June 22, 1942, the U.S. District Attorney for the Western District of Kentucky filed a third Petition, pursuant to the War Purposes Act, condemning 824 acres in Union County. See United States v. 824 Acres in Union County, No. 81 (W.D. Ky., filed June 22, 1942).7 On June 27, 1942, Declaration of Takings No. 2 was filed to acquire 2,171.16 acres in fee simple for which $219,807.00 was deposited into the Registry. These properties were subject to United States v. 19,517.30 Acres. See JX 264C, D.

This property was owned by 15 landowners: Marion Russell; J.E. Caton; Kathryn Caton; W.B. Caton; Ella Caton; the Nancy E. Ward Estate; A.O.S. Wilson; Hessie Adamson (two tracts); Nelson Tilley; Erlene Liggett; Roy Tilley; Ruby Key; Illoff Tilley; Henry Tilley; and W.E. Liles. 9

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On July 6, 1942, Declaration of Takings No. 3 was filed to acquire 3,813.52 acres in fee simple for which $236,149 was deposited into the Registry. See JX 264E. On July 27, 1942, Declaration of Takings No. 4 was filed to acquire 3,915.72 acres in fee simple for which $253,372 was deposited into the Registry. See JX 264F-G. On August 27, 1942, Declaration of Takings No. 5 was filed to acquire 1,691.86 acres in fee simple for which $128,419 was deposited in the Registry. See JX 264H. 4. The October 1942 Condemnation Of 5,400 Acres In Webster County.

On October 15, 1942, an additional 5,400 acres was approved for acquisition, bringing the total to 36,199 acres at an estimated cost of $3,727,460. See JX 19; JX 22 at DOJ1349. On October 23, 1942, the fourth Petition was filed to condemn 5,400 acres located in northwestern Webster County. See JX 503 at CON3830. The largest landowner, Judge Robert L. Higginson, owned 803 acres; Mr. Nealie Tapp and his sons, Bryon, Milton, and Jesse, owned 605 acres.8 5. The January 1943 Condemnation Of 280 Acres.

In January 1943, the Government condemned 280 acres to expand an air field.9 On April 13, 1943, Declaration of Takings No. 6 was filed to acquire 1,138.40 acres in fee simple. See JX 264I. On May 20, 1943, Declaration of Takings No. 6-R was filed to acquire 433.71 acres in fee simple for which $27,320 was deposited into the Registry. See JX 264J. In October 1943, the Government condemned 1,072 acres near Sturgis, Kentucky for use as an air field.10 See JX 536G. 6. The May 1943 Condemnation Of 9.4 Acres In Union County.

On May 4, 1943, the Office of the Chief of Engineers of the War Department stated there was a military necessity for the acquisition of 9.4 acres in fee for a right-of-way easement for construction

The Government also had acquired an additional 300 acres from the Tapp family in a prior condemnation. See United States v. 5,400 Acres Situated in Henderson, Union, and Webster Counties, No. 88 (W.D. Ky., filed Mar. 8, 1943); JX 504 at CON3834. The owners of this property were: Nina Sue Simpson; J.S. McKesig Estate; West Kentucky Coal Company; J.C. Welch; Ralph E. Dudley; G.T. Davis; John G. Wynns; R.E. Wynns; and Otis Caldwell. See JX 536H. The owners of this property were: John G. Wynn; Francis Meacham; Oliver Harley; George Davis; Ralph Dudley; Beulah Shoulders; Otis Caldwell; West Kentucky Coal Company; the F.M. Gilchrist Estate; the J.C. Welch Estate; C.W. Dunn; Cecilia Staton Sprauge; and J.S. McKeigh. See JX 536G. After World War II, the Government transferred the Air Field to Union County, which became the site of the Sturgis Kentucky Municipal Airport. 10
10 9

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and maintenance of a raw water line for a well. See JX 22 at DOJ1349. The estimated cost was $8,440. Id. This land, located in Union County, was described as "[a]gricultural land without improvements but active mineral rights." Id. (emphasis added). This appears to be the first indication that the Government was aware of the potential value of mineral rights on the condemned properties. Compare with JX 13 at DOJ1294; see also JX 14 at DOJ1296; JX 21 at DOJ1336; JX 25 at DOJ1357; JX 22 at DOJ1349. 7. The May 1944 Condemnation Of 16.37 Acres In Union County.

On May 12, 1944, the local U.S. District Attorney filed a fifth petition to condemn 16.37 acres, located in Union County, Kentucky. See United States v. 16.37 Acres Situated in Union County Kentucky, No. 134 (W.D. Ky., filed May 12, 1944). B. Disposition Of Waller Young Property In 1957.

On December 9, 1954, the Department of Defense ("DOD") declared that approximately 212.5 acres of Camp Breckinridge was excess real property. See JX 6 at DOJ0298 (indicating that this land was subject to an agricultural lease to Mr. Waller Young, the former owner for the term March 1, 1951­February 28, 1956).11 On May 28, 1956, upon receiving $48,875.00, or $230 per acre,12 GSA executed a quit claim deed to Waller Young, pursuant to the Federal Property and Administrative Services Act of 1949 (40 U.S.C. § 471, et seq.), and regulations and orders promulgated thereunder. See JX 6 at DOJ0305-06. Although documents in the record state that this property was advertised to the general public in advance of sale and sold at public auction, in fact, none of these documents evidence that the Government advertised the availability of this specific land for purchase. See JX 10 at DOJ0996 (March 4, 1968 Tract Register re: Quit Claim Deed, dated 5-28-56 re: 3.30 acres sold to Waller Young for "Maintenance of Water Line," March 10, 1954 Directive, pursuant to DA ACS 5th Ind.); see also JX 60 at DOJ1586 ("In 1954, a 212.5-acre parcel of installation land was determined to be

See JX 46 at DOJ1531 (April 16, 1957 letter from Floyd S. Bryant, Assistant Secretary of Defense to Congressman William N. Natcher, Second District of Kentucky, advising that approximately 1/3 of Camp Breckinridge or 12,000 acres was outleased for agricultural purposes); see also PX 272 (July 13, 1995 William Logan Newman Dep.) at 15-17 (Mr. Newman testified that he had a five-year lease on some of his property after World War II, but his lease was terminated after the Camp was revived. During 1953-1954, Newman again leased this property, but the lease expired after the Camp was designated as a summer training facility for Reserve Troops in 1955); DX 64 at DOJ1219. This was the 212.5 acres previously conveyed to the Government on March 18, 1944, following a jury determination that the fair market value of the land was $26,711.86 or $125.70 per acre, including $2,643.40 for oil and gas rights. JX 6 at DOJ0300-01; see also JX 10 at DOJ0957 (indicating that Waller Young sold 1,026.8 acres to the Government on April 18, 1944 for $147,663.16 or $143.80 per acre). 11
12

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excess[.] After clearance with the Armed Services Committees of the Congress, (10 U.S.C. [§] 2662), the land was reported to the General Services Administration[.]"); DX 64 at DOJ1198 (indicating that the 212.5 acres were sold "following agreement with the respective Committees on Armed Services in Army Disposal Project No. 28[.]"). Although the Waller Young property was located almost in the middle of Camp Breckinridge, DOD identified this sole parcel as "excess real property." See PX 77a. Mr. Waller Young was the former Mayor of Morganfield. C. The Department Of The Interior's 1956 Discovery Of Oil And Issuance Of Oil And Gas Leases in 1957 And 1959.

On February 14, 1946, the Chief Engineer for the Department of the Army advised Congressman Earle C. Clements, Second District of Kentucky, that: The Government is the owner and in possession of considerable land at each of these installations (Ohio River Ordnance Works and Camp Breckinridge, Kentucky). There has been considerable prospecting for oil in the two counties where these Government properties are located and there has been much speculation as to whether or not the Government would consider an oil lease to private interests on either or both of these installations. Under existing law [Surplus Property Act of 1944, as amended], should this land be disposed of to private interests, the former owner would be given preference and it is my judgment since there is a prospect of this occurring there should be no separation of the surface and mineral rights. JX 46 at DOJ1531-32 (emphasis added). Nevertheless, on January 2, 1948, the U.S. District Attorney instituted condemnation proceedings regarding existing oil and gas leases on real properties. See United States v. Leasehold Interest In Oil and Gas Rights in 2,314.14 Acres Situated in Union, Webster, and Henderson Counties, No. 371 (W.D. Ky., filed Jan. 2, 1948); see also JX 535. On June 19, 1951, jurisdiction over all gas and oil deposits on the Camp Breckinridge site was transferred from DOD to the Department of the Interior ("DOI"), pursuant to an April 24, 1943 Executive Order No. 9337, to protect the Government's interests from loss due to "drainage or threatened drainage [of oil and gas.]" See JX 4 (16 FED . REG . 6132-35 (June 26, 1951)). Sometime in May 1954, DOI's Office of Geological Survey identified potentially significant oil and gas deposits present under the Camp Breckinridge lands. See DX 40 at DOJ0311. In August 1956, that Office confirmed that oil and gas deposits under Camp Breckinridge were being lost due to "drainage," caused by wells adjacent to the Camp's boundaries. See id. at DOJ0311. On or about March 15, 1957, DOI announced the intention to issue "protective leases" to prevent those oil and gas deposits from being drained. See DX 158 at DOJ1527.

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On March 15, 1957, Dr. W. H. Puryear of Morganfield, Kentucky and Judge A. G. Pritchett of Henderson, Kentucky wrote a letter to DOI's Director of the Bureau of Land Management to protest the proposed protective leases of oil "underlying the lands owned by us until same were condemned by the United States" and to demand the right to "receive our proportionate part of the royalty oil that is produced and sold from the lands formerly owned by us until taken from us by the Government for military purposes. . . . Will you kindly acknowledge the filing of this protest so that we may protect our rights in property that we believe when it ceases to be used for military purposes or is classified as excess or surplus land, that we should be given preference in repurchasing it from your Department or some other branch of the Government[?]" DX 158 at DOJ1527-28. Less than a month later, on April 22, 1957, without a formal hearing, DOI's Director of the Bureau of Land Management issued a "Decision" dismissing the "Protest." See DX 40; see also DX 182A at DOJ2699 (Mar. 22, 1957 letter from the President of Felmont Oil to Bureau of Land Management requesting that the 30-day appeal period be eliminated). The April 22, 1957 Decision conceded that: Lands acquired by the Government for use for military purposes, such as the Camp Breckinridge area, are not subject to lease for development of the mineral deposits therein under the general authority contained in the Acquired Lands Mineral Leasing Act of August 7, 1947 (61 Stat. 913, 30 U.S.C. [§] 351) which is administered by this Department. DX 40 at DOJ0310 (emphasis added). Nevertheless, the DOI's Director of the Bureau of Land Management, without a hearing, concluded that: the Attorney General has ruled that, in those cases where lands are being drained through operations on adjoining privately-owned lands, there is implied authority for the United States to take such action as may be necessary to adequately protect itself from loss by reason of the drainage (40 Op. Atty. Gen. 41). Although this protective action may be taken by the branch of the Defense Department which acquired the land, jurisdiction over the oil and gas deposits for that purpose may be transferred to another department or agency if it is deemed advisable to do so. Jurisdiction over the oil and gas deposits underlying the Camp Breckinridge area, comprising a total of 35,839.88 acres, was transferred to this Department by Public Land Order No. 729 dated June 19, 1951, under the express condition that the Department of the Army shall exercise primary jurisdiction over these lands for military purposes. No steps have heretofore been taken to offer any of the lands for oil and gas leasing because of the intensified military use of the camp area which commenced in September 1950. Investigation of the drainage situation by the Geological Survey of 13

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this Department in May 1954 disclosed that the threat of drainage from oil wells in the South Morganfield oil field had been diminished to a considerable extent, if not entirely eliminated. Consequently, further action on this matter was then suspended pending completion of a study by the Army of its need for the land for military purposes. The situation with respect to drainage of the oil and gas deposits at Camp Breckinridge remained unchanged until August 1956, when the Geological Survey reported that a total of 14 wells had been completed during 1956 in the Dixie, West Field or Abell area of Henderson County, Kentucky, adjacent to the east boundary of the camp. These wells were producing from the First and Second Pennsylvania sands at an approximate depth of 975 feet, except for one well producing from the Cypress sand of the Mississippian age at a depth of 2,260 feet. Initial daily production capacities of the wells ranged from about 25 to 120 barrels of oil, with production at that time from 8 wells being 168 barrels per day. The camp is offset directly by 5 of these wells. In order to protect the United States against loss by reason of the drainage of the oil and gas deposits occurring from the Camp Breckinridge lands, the tract of 190 acres on the east boundary of the camp was offered for leasing on March 20, 1957. The jurisdiction over the oil and gas deposits now being vested in the Department of the Interior, this Department has the legal obligation to take such measures as may be necessary to protect the interests of the United States from loss through the extensive drainage of these deposits presently occurring from the Camp Breckinridge lands. Inasmuch as exclusive jurisdiction over these lands is vested in the Department of the Army, the future disposition of such lands rests with that agency and in the event the lands should be declared surplus, the disposition of the minerals therein will be governed by the law in effect at that time. In view of the foregoing circumstances, and in the absence of legislation, this Department would be remiss in its duty of protecting the Government property and the public interests from loss by reason of the drainage of the oil and gas deposits in the Camp Breckinridge lands if the issuance of an oil and gas lease for this 190-acre tract were withheld. Accordingly, the protests against the leasing of this land are hereby dismissed. Id. at DOJ0310-12. There is no record of whether the former landowners filed any appeal or collateral attack of DOI's decision in federal court. On May 1, 1957, the Government entered into a lease, KYBLM-A-044315, with Felmont Oil Corporation of Owensboro, Kentucky ("Felmont Oil") for oil and gas underlying 190 acres of Camp Breckinridge. See DX 183A (Ex. 73) at DOJ3440; see also Gov't May 26, 2004 Answer to Interrogatory No. 8 at 12. This lease indicates that it was subject to prior leases with [Judge] Ashley 14

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G. Pritchett and Willard Greenwell who had occupied the land for "agricultural and grazing purposes." DX 183A (Ex. 73) at DOJ3442. The following map shows the 190 acres leased by Felmont Oil.

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DX 183A (Ex. 73) at DOJ3441. The Felmont Oil lease produced 611,235 barrels of crude from August 6, 1957­April 30, 1964, during which period the Government received $272,883 in royalty payments and a "bonus" of $432,236. See DX 183A (Ex. 80) at DOJ3569; see also DX 182A at DOJ2699. 16

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On December 1, 1959, the Government entered into a second lease, KYBLM-A-050213, with Kingwood Oil Company ("Kingwood Oil") for oil and gas underlying 700 acres of Camp Breckinridge. See DX 183 (Ex. 74) at DOJ3451; see also Gov't May 26, 2004 Answer to Interrogatory No. 8. This lease was subject to prior leases with Mark Greenwell for "agricultural and grazing purposes" that expired on October 21, 1959. DX 183 (Ex. 74) at DOJ3452. The following map shows the 700 acres leased by Kingwood Oil.

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DX 183 (Ex. 74) at DOJ3461. 18

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From January 19, 1960­April 30, 1964, the Kingwood Oil lease produced 934,498 barrels of crude oil, during which time the Government received 15% of the gross production in royalties or $418,443 and a "bonus" of $708,253. See DX 183 (Ex. 80) at DOJ3569. D. The Closure and Disposition Of Camp Breckinridge.

On March 14, 1946, certain housing facilities at Camp Breckinridge were declared surplus property. See JX 27. On January 16, 1948, the United States Housing and Home Finance Agency transferred other facilities to the Department of Army. See JX 30. On July 15, 1948, however, Camp Breckinridge was returned to active status, because of the onset of the Korean War. See JX 31; see also JX 32; JX 37. By the fall of 1949, however, some of the land at Camp Breckinridge was offered to the former landowners to farm, but only on a five-year lease. See, e.g., DX 643; CX 272 (July 13, 1995 Newman Dep. at 15-17; Tilley Dep. at 39-40). After the Korean War ended in 1954, Army Reserve and National Guard units continued to train on the site until 1959. On October 31, 1962 and November 2, 1962, Army Disposal Report No. 2 was submitted to the United States Senate and United States House of Representatives Armed Services Committees, respectively, pursuant to 10 U.S.C. § 2662. See JX 58 at DOJ1580; see also DX 64 at DOJ1179, 1198-99 (Disposal Report); DX 77 at DOJ3463; JX 7; JX 60 at DOJ1586. In December 1962, after both Committees approved the Disposal Report, DOD issued a Report of Excess Real Property that was forwarded to GSA for implementation, in a manner consistent with the "best interests" of the Government. See Surplus Property Act, Section 502, 50 U.S.C. §§ 1611-46 (1944). 1. The Sale Of Coal, Gas, Oil, And Other Mineral Rights In 1965.

On January 5, 1965, GSA issued Invitations for (Sealed) Bids on all mineral rights on approximately 36,000 acres comprising Camp Breckinridge. See JX 47 at DOJ1535-36; JX 58 at DOJ1581; see also DX 183 at DOJ2789 (July 21, 2004 Brigham Direct at 34) (reporting that the January 7, 1965 edition of the UNION COUNTY ADVOCATE stated that more than 500 sealed bids were submitted to GSA for these rights). The GSA advertisement read as follows: POTENTIAL UNDERGROUND WEALTH! U.S. GOVERNMENT SALE FULL SUB-SURFACE INTEREST MINERAL RIGHTS COAL, OIL, GAS AND ALL OTHER MINERALS CAMP BRECKENRIDGE 19

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1 ½ MILES EAST OF MORGANFIELD, KENTUCKY GSA DISPOSAL NO. [ILLEGIBLE] TO BE SOLD BY SEALED BID BID OPENING THURSDAY, APRIL 15, 1965 (3:00 P.M.-C.S.T.) This government property for sale is an unusually fine opportunity for the investor. Look at the facts. APPROXIMATELY 35,000 ACRES­Divided into 10 tracts. EXISTING PRODUCING LEASES INCLUDED IN MINERAL RICH COUNTRY­This northwestern Kentucky property off U.S. Highway 60 is located in Henderson, Union and Webster Counties. Here is a strategic exploratory area surrounded by the following pools: Little Dixie, Sebree, Niagara, Baskett, Henderson, Poole. The property is also in the heart of the western Kentucky coal fields. AND­A TOP WORK AREA­The area offers numerous advantages: ample skilled and unskilled labor; bus, truck and rail; approximately seven miles from Ohio River port; full educational system plus four colleges nearby. BIDDING­The mineral rights are being offered in tracts and not by acreage. The following items will be offered in each tract: Item A­coal rights only; Item B­oil, gas and all other minerals, except coal; Item C­all mineral rights. Bids may be submitted on individual items and tracts or any combination of items and tracts. Bids must be submitted on bid forms provided by General Services Administration. CX 244. On January 14, 1965, an industry publication, "Scout Check, Inc.," alerted subscribers that, because "so many requests for maps and information on the Government sale of Camp Breckinridge" had been received, the publication was featuring "a map of the camp divided into Tracts as they will be sold and showing the surrounding production and the Rough Creek Fault system, making this piece of oil property one of the most attractive in the country to oil and coal prospectors." Court Ex. 4 at 1. This report advised that Camp Breckinridge was divided into ten tracts, excluding Tract #1 and the Barracks area from sale. Id. Although the mineral rights were to be sold, the surface rights were reserved for sale at a later date. Id. Regarding the upcoming mineral rights sale, it was reported that: the [C]amp has tremendous possibilities for oil being found under it. All of the fields around the [C]amp have been discovered since the [C]amp was built. In 1956, the 20

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Dixie West Pool was discovered in the southwest quarter of 0-22, in Pennsylvanian and Cypress sands, and has accumulated over 4 ½ million barrels of oil to date with the field still producing over 80,000 barrels per month. Felmont Oil (now owned by Cities Service Oil) leased 190 acres of the camp from the Government and has produced over 718,000 barrels from 18 wells, still producing 12,800 barrels per month. (See Tract 7-B)[.] In late 1959, Kingwood Oil leased an additional 700 acres from the Government (see Tract 7-A) and has produced over 1,021,000 barrels to date, still making 10,600 barrels per month from 14 wells. Kingwood paid a bonus of $708,000.00 for their acreage and Felmont paid $432,000.00 to the Government. . . . Other fields around the [C]amp that will probably be extended are the Morganfield South Pool, discovered in 1948, accumulating 7,250,000 barrels to date, producing 40,500 barrels per month. This field lies on the west side of the reservation, just north of the Rough Creek Fault, and will probably be extended well into Tract 2, along the fault zone. Four miles straight east of this field, back in 1930, there were several holes drilled in the northwest corner of 1-N-20 that had shows of oil in the Pennsylvanian, with one or two of them producing for a short time. There will probably be oil found somewhere between these dry holes and the Morganfield South production. Id. The following map shows the 10 tracts of coal, gas, oil, and other mineral rights to be awarded at the April 15, 1965 auction.

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Court Ex. 3I at 12; Court Ex. 4 at 2. 22

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All of the bids were to be sealed, forwarded with a cash deposit, and received by April 15, 1965 at 3:00 p.m. at the GSA's Business Center in Chicago. See CX 244.13 On June 11, 1965, Public Land Order No. 729 (of June 19, 1951) was revoked by Public Land Order No. 3706, pursuant to Executive Order No. 10355 (17 FED . REG . 4831) and jurisdiction over Camp Breckinridge's oil and gas rights was transferred from DOI to GSA. See DX 183 (Ex. 72) at DOJ3437. On June 18, 1965, GSA Administrator Lawson B. Knott, Jr., advised Congressman Edward Gurney that as a result of the April 15, 1965 offer to sell coal, gas, oil, or other mineral rights, the GSA received "high bids" of $31,982,547.70. See JX 48 at DOJ1537. In fact, the Tennessee Valley Authority ("TVA") alone was awarded coal rights on 30,590 acres as "the highest bidder [of approximately $7,410,000] in a 1965 sale conducted by the General Services Administration." See WALL ST . J. (Feb. 11, 1969) at 24; see also DX 183 at DOJ2789; DX 183 (Ex. 83) at DOJ3576-77; DX 183 (Ex. 84) at DOJ3579. It appears that TVA's bid was quite a bargain since only four years later - - on or about February 11, 1969 - - TVA awarded Peabody Coal Co. a lease to mine these coal reserves at Camp Breckinridge for $400 million. See WALL ST . J. (Feb. 11, 1969) at 24. 2. The Sale Of Coal Rights In 1967.

On August 24, 1967, GSA announced that coal rights on 4,800 acres consisting of 3,930 acres (Tract 1), 700 acres (Tract 7A) and 190 acres (Tract 7B) would be subject to a sealed bid auction to be held in Chicago on September 29, 1967. See Court Ex. 3A (Aug. 24, 1967 GSA News Release); see also Court Ex. 3I. It appears, however, that GSA sent "invitations to bid" only to selected entities. Of further interest is a caveat on the "Notice to Prospective Bidders," which stated: Under no circumstances should this invitation be given to any other person or firm for use in submitting a bid. The General Services Administration, Region 5, maintains and furnishes copies of this Invitation to any parties interested in submitting a bid. Interested parties should contact the Business Service Center for Invitation copies and information desired. The Business Service Center maintains a record of the names and addresses of all parties issued copies of this Invitation to Bid[.] Court Ex. 3I at 2. The sealed bids were not opened in the local community, but at GSA's Chicago office. Id.

It is not clear whether GSA had authority on April 15, 1965 to award bids on the oil and gas rights at issue, since the Government did not produce documents establishing that authority; however, the court assumes the relevant sales documents were executed after June 11, 1965. 23

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a.)

Tract No. 1.

The surface area of Tract No. 1 was described as a portion of land conveyed to the Commonwealth of Kentucky for park, recreational, and wildlife conservation purposes with a remainder to Allen D. Freer. Id. (Invitation for Bids at 5). The description of Tract No. 1 indicates that the oil, gas, and other mineral rights (except coal), located in Webster and Union Counties, previously were conveyed to the Sun Oil Company and Texas Gas Exploration Corporation by recorded deed. Id. b.) Tract No. 7A.

The surface area of Tract No. 7A, located in Union and Henderson counties, was described as "contained within portions of surface parcels" conveyed in: Parcel No. 8A in Union County to Richard L. Maloney and Patrick A Maloney. Court Ex. 3I (Invitation for Bids at 5). Parcel No. 9 in Henderson County was conveyed to the Gibson Livestock Company. Id. Parcel No. 9A in Henderson County was conveyed to Aaron G. Pritchett and Mary Edith Pritchett. Id. Parcel No. 10, located in Union, Henderson, and Webster Counties, was conveyed to James C. Bickett, Margaret Agnes Bickett, Edmond Bickett, and Lula Margaret Bickett. Id. at 6. Oil, gas, and other mineral rights (except coal) on Tract No. 7A were reported as subject to Federal Lease BLM-A-050213 with the Kingwood Oil Company. Id. c.) Tract No. 7B.

The surface area of Tract No. 7B, a portion of surface Parcel No. 9A, located in Henderson County, was conveyed to Aaron G. Pritchett and Mary Edith Pritchett by warranty deed. See Court Ex. 3I (Invitation for Bids at 6). Oil, gas, and other mineral rights (except coal) located in Henderson County, pursuant to Federal Lease BLM-A-044315, were reported as subject to a prior lease with the Felmont Corporation of Owensboro, Kentucky. Id. The following map shows the location of Tract 1, Tract 7A, and Tract 7B.

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Court Ex. 3I (Ex. B). 25

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E.

The Enactment Of S. 794 In 1993.

On April 15, 1965, Mr. Cyrus Higginson, on behalf of himself and "all other former landowners, or heirs, successors, and assigns thereof, of 36,000 acres, namely Camp Breckinridge, in Union, Henderson and Webster Counties, Kentucky" filed a class action in the United States District Court for the Western District of Kentucky, Owensboro Division. See DX 64 at DOJ1069. An April 29, 1965 Amended Complaint set forth claims under the Fifth and Fourteenth Amendments of the United States Constitution and violations of the Surplus Property Act of 1944, both as to land and mineral rights. See id. at DOJ1080-85. At the conclusion of a July 30, 1965 trial, the Chief Judge of the United States District Court for the Western District of Kentucky delivered an oral decision and entered an Order sustaining the Government's motion to dismiss. DX 64 at DOJ1209. A written order was issued on August 2, 1965. Id.; see also id. at DOJ1247 (Sept. 9, 1965 Final Order). On September 28, 1967, the United States Court of Appeals for the Sixth Circuit, in a per curiam opinion, held that since the Surplus Property Act was repealed in 1949, "13 years before Camp Breckenridge was declared surplus and 16 years prior to commencement of this action[,] [o]bviously no right could accrue to plaintiff thereunder." Higginson v. United States, 384 F.2d 504, 506 (6th Cir. 1967); see also Land Grantors I, 64 Fed. Cl. at 680-81. Sometime in 1968, after the United States Supreme Court denied certiorari in the Higginson case, a group of former landowners and/or their heirs formed the Breckinridge Land Committee and turned to Congress to seek redress.14 Compare Higginson Dep. at 285, 304, 328 and CX 267 (Murphy Dep.) at 13-14, 18 with CX 53. On or about June 6, 1973, the first specific request for a Senate inquiry of this matter appears to have been directed to the GSA by Senator Walter D. Huddleston. See CX 22 (Ex. B22 to Claimants' Dec. 14, 2004 Motion Regarding Trial Exhibits); see also JX 57 at DOJ1565 (Apr. 17, 1974 letter from Senator Marlow W. Cook to Mrs. Ruby [Higginson] Au.). The record does not reflect the result of the GSA inquiry. Sometime in 1978, the Breckinridge Land Committee garnered the support of a non-profit environmental public interest organization, known as the Kentucky River Coalition ("KRC"). A graduate of Eastern Kentucky University in journalism, with an interest in environmental issues, was assigned to interview former landowners and government representatives and search for records that might support the former landowners' grievances. See CX 267 (Murphy Dep. at 9, 13, 15, 16, 17, 21, 22, 24). KRC assisted in locating many of the former landowners who signed Affidavits to preserve their knowledge of the 1942-1944 condemnations, and on April 6, 1979 a Report was

See, e.g., JX 58-59 (referencing letters from Mrs. Ruby Higginson Au in 1976, 1978, and 1979 to Congressman Carroll Hubbard); Court Ex. 3A (referencing Congressman Gene Snyder forwarding letter of Mrs. Ruby Higginson Au to Paul E. Goulding, Deputy Administrator, GSA). 26

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forwarded to Senator Wendell Ford, Senator Walter Huddleston, Congressman William H. Natcher, and Congressman Carroll Hubbard. See CX 11. In 1983, at the request of Senator Wendell A. Ford, Senator Charles E. Grassley, then Chairman of the Administrative Practice and Procedure Subcommittee of the United States Senate, forwarded S. 1104, "For the relief of the grantors of certain land in Henderson, Union, and Webster Counties, Kentucky" to the Senate Judiciary Committee. The Department of the Army, however, opposed enactment of S. 1104 and no further congressional action took place at that time. See JX 60 at DOJ1584-88. On January 6, 1987, Senator Ford introduced a bill, substantially similar to S. 1104, that also failed to be reported out of the United States Senate. See 133 CONG . REC. S12183-01. Subsequent efforts again failed in 1989 and 1991. See 135 CONG . REC. S9366-01 (Aug. 1, 1989); 137 CONG . REC. S12183-01 (Aug. 2, 1991); see also CX 36 (Ex. B) (Oct. 23, 1981 letter from Senator Wendell H. Ford to Senator Charles E. Grassley, Chairman, Senate Subcommittee on Agency Administration); CX 37 (Ex. B) (Jan. 31, 1980 letter from Senator Walter D. Huddleston to Senator Edward M. Kennedy, Chairman, Senate Judiciary Committee). On April 19, 1993, Senator Ford introduced S. 794, "a bill for the relief of land grantors in Henderson, Union, and Webster Counties, Kentucky, and their heirs." See S. 794, 103d Cong. (1993). On October 19, 1993, S. 794, together with S. Res. 98 (Resolution, Calendar No. 204), 103d Congress, 1st Session (Sept. 20, 1993) successfully were reported out of the United States Senate and forwarded as a congressional reference to the Honorable Loren A. Smith, then the Chief Judge of the United States Court of Federal Claims. S. 794 provided, in relevant part: Section 1. Authorization. The Secretary of the Treasury is authorized and directed to pay, out of money not otherwise appropriated, to the individuals (and in any case in which such individual is deceased, the heirs of such individual) who sold their land in Henderson, Union, and Webster Counties, Kentucky, to the United States Government under threat of condemnation in order to provide the 35,684.99 acres necessary for the military training camp known as Camp Breckinridge, the sum of $_______, such sum being in full satisfaction of all claims by such individuals against the United States arising out of such sale. Section 2. Reason for Relief. The individuals described in Section 1 assert that they were­ (1) promised they would be given priority to repurchase land sold by them if sold by the United States Government; and 27

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(2) paid less than reasonable value due in part to the refusal of the United States Government to compensate the owners for mineral, oil and gas rights. S. 794, 103d Cong. (1993). S. Res. 98 directed the Chief Judge to "proceed . . . in accordance with the provisions of sections 1492 and 2509 of title 28, United States Code, and report back to the Senate, at the earliest practicable date, giving such findings of fact and conclusions that are sufficient to inform Congress of the amount, if any, legally or equitably due from the United States to the claimants individually." II. RELEVANT PROCEDURAL HISTORY.15

On December 14, 2006, a Second Interim Report and Memorandum Opinion was issued determining "that the interests of justice require deferral of a final disposition in this case until the en banc decision in [Kirkendall v. Dep't of the Army, 412 F.3d 1273, 1275-78 (Fed. Cir. 2005) (holding that claims under the Veterans Employment Opportunities Act of 1998, 5 U.S.C. § 3330a(1)(a)(A), may be equitably tolled)] is issued and final." See Land Grantors III, 74 Fed. Cl. at 525. The court also ordered the parties "to inform the court, no later than January 31, 2007, whether they consent to the designation of Mr. Fred F. Fielding as a Mediator in this case," and to relay "an appropriate time period for the court to stay this proceeding to ascertain whether a settlement may be achieved." Id. at 526. On January 9, 2007, however, Mr. Fielding was appointed to serve as Counsel to the President of the United States. On February 26, 2007, a petition for certiorari was filed in John R. Sand & Gravel Co. v. United States, 457 F.3d 1345 (Fed. Cir. 2006) (holding that 28 U.S.C. § 2501 is jurisdictional and may not be waived). See Petition for Writ of Certiorari, John R. Sand & Gravel Co. v. United States, No. 061164, 2007 WL 579742 (U.S. Feb. 26, 2007). In light of these developments, on February 28, 2007, the court entered an Order, pursuant to RCFC Appendix H, appointing Justice Sandra Day O'Connor to serve as a Mediator, for a term of 120 days, to commence on March 1, 2007, and ordering the parties to provide the court with a copy of any agreement reached or a status report by July 9, 2007. On that same date, the court issued an Order severing the claims in the October 3, 2005 Second Amended Complaint, asserted under 28 U.S.C. § 1491, from those asserted under 28 U.S.C. §§ 1492, 2509, and the Clerk of Court assigned a new docket number (Case No. 93-6481L) for claims asserted under 28 U.S.C. § 1491.

The procedural history of this proceeding from January 12, 1994 until August 15, 2003, the date the undersigned was assigned to this matter, and proceedings from August 15, 2003 until issuance of the April 1, 2005 Interim Report And Memorandum Opinion, is set forth in detail in Land Grantors I, 64 Fed. Cl. at 685-88. The procedural history of this proceeding from April 1, 2005 to December 14, 2006 is set forth in Land Grantors III, 74 Fed. Cl. at 521-23. 28

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On May 18, 2007, Claimants filed a Notice Of Withdrawal From Mediation, advising the court that settlement negotiations had broken down and that the parties' positions were irreconcilable. On May 29, 2007, the Government filed a Response requesting that the court stay the congressional reference claims and resolve the Tucker Act claims. On that same date, the United States Supreme Court granted the petition for certiorari in John R. Sand & Gravel Co. See John R. Sand & Gravel Co. v. United States, 127 S. Ct. 2877 (2007) (granting petition for writ of certiorari). On June 27, 2007, the court convened a telephone status conference to ascertain whether to enter a final judgment in the pending Tucker Act case or to enter a Final Report in the congressional reference. On July 6, 2007, Claimants filed a Response, advising the court that they were withdrawing their earlier request that the court stay the Tucker Act case and instead requested resolution of any outstanding issues regarding those pending claims and final judgment. On July 31, 2007, a Third Interim Report, Memorandum Opinion, And Order was issued, denying the Government's October 21, 2005 Objection to the filing of Claimants' Second Amended Complaint, but granting the Government's request to file a Motion To Dismiss in Case No. 936481L. See Land Grantors IV, 77 Fed. Cl. at 687. The Government was instructed to file a Motion To Dismiss in Case No. 93-6481L and any other dispositive motions on the merits, no later than October 1, 2007. Id. On October 1, 2007, the Government filed a Motion For Judgment On The Pleadings, Or, In The Alternative, Motion For Judgment On The Record, together with a supporting Memorandum, in Case No. 93-6481L. On December 14, 2007, Claimants filed a Response. On January 8, 2008, the United States Supreme Court held that the statute of limitations governing claims filed under 28 U.S.C. § 2501 is "absolute . . . forbidding a court to consider whether certain equitable considerations warrant extending a limitations period. As convenient shorthand, the Court has sometimes referred to the time limits in such statutes as `jurisdictional.'" John R. Sand & Gravel Co., 128 S. Ct. at 753 (internal citations omitted). Accordingly, on January 10, 2008, a Memorandum Opinion And Final Judgment was promptly issued, dismissing Case No. 93-6481L as barred by 28 U.S.C. § 2501. See Land Grantors V, 80 Fed. Cl. at 196-97. The stay on Reference No. 93-648X was lifted and the parties were advised that a Final Report would issue on or before April 14, 2008. On March 6, 2008, Claimants filed a Motion To Vacate a November 24, 1998 Order, together with an Exhibit ("Ex. A"), asserting this decade-old Order improperly limited the scope of Claimants who would be entitled to compensation. On March 24, 2008, the Government filed an Opposition ("Gov't Opp. Claimants' Mot."). On April 7, 2008, Claimants filed a Reply. To fully evaluate these recent findings, the issuance date of the Final Report was extended five days to April 18, 2008.

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III.

DISCUSSION. A. Jurisdiction.

Congress enacted 28 U.S.C. § 2509 to authorize the United States Court of Federal Claims "to determine the facts, including facts relating to delay or laches, facts bearing upon the question whether the bar of any statute of limitation should be removed, or facts claimed to excuse the claimant for not having resorted to any established legal remedy . . . . [a]nd inform Congress whether the demand is a legal or equitable claim or a gratuity, and the amount[.]" 28 U.S.C. § 2509(c). In this case, the Second Amended Complaint seeks the court's exercise of jurisdiction under both 28 U.S.C. § 1492 and 28 U.S.C. § 2509(c). See Sec. Amend. Compl. ¶ 1 at 26. Therefore, the court has determined that the Second Amended Complaint sets forth the requisite elements of a claim for mutual mistake and entitlement to restitution. Id. ¶¶ 32-40 ("Mutual Mistake Claim For Restitution"). B. Standing.

To establish injury in fact, a plaintiff must have suffered: "an invasion of a legally protected interest which is (a) concrete and particularized, and (b) `actual or imminent, not conjectural or hypothetical.'" Lujan v. Defenders of Wildlife, 504 U.S. 555, 560 (1992) (emphasis added) (internal citations omitted). In this case, Claimants alleged "legally protected interests" in coal, gas, oil, and other mineral rights, that were mistakenly subject to the contracts entered into with the Government during the period 1942-1944 and subsequently invaded by lease and sale of that property. See Tenn. Elec. Power Co. v. Tenn. Valley Auth., 306 U.S. 118, 137 (1939) (holding that a claim based on the invasion of a legal right includes "one of property [and] one arising out of contract"); cf. U.S. Trust Co. of N.Y. v. New Jersey, 431 U.S. 1, 19 n.16 (1977) ("Contract rights are a form of property and as such may be taken for a public purpose provided that just compensation is paid."); Cienega Gardens v. United States, 331 F.3d 1319, 1328-31 (Fed. Cir. 2003) (same). The burden on Claimants is to evidence "specific facts," establishing that a recovery is "concrete" and "particularized." See Lujan, 504 U.S. at 560-61. Both of these standing requirements have been met. See Land Grantors I, 64 Fed. Cl. at 696. C. Standard of Review.

The United States Court of Federal Claims has held that: the words `legal claim' as used in the congressional reference statute imply no special meaning beyond the conventional understanding of that term: a claim based on the

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invasion of a legal right, that is `one of property, one arising out of contract, one protected against tortious invasion, or one founded on a statute which confers a privilege.' Spalding & Son, Inc. v. United States, 28 Fed. Cl. 242, 247 (1993) (quoting Tenn. Elec. Power Co., 306 U.S. at 137-38). The statute authorizing a congressional reference, 28 U.S.C. § 2509(c), also requires that the hearing officer determine "whether the bar of any statute of limitation should be removed, or facts claimed to excuse the claimant for not having resorted to any established legal remedy." 28 U.S.C. § 2509(c). The inquiry is "whether the bar should be lifted only with respect to legal claims[.]" Inslaw, Inc. v. United States, 39 Fed. Cl. 307, 328 (1997). The bar may be lifted if there is "good cause." See Kanehl v. United States, 38 Fed. Cl. 89, 104 (1997). Good cause may be found where: "`the government's administrative consideration of the claim was slipshod and desultory, thereby contributing to the delay which caused the damage; where the claimant has relied on Government advice to his detriment; where he was not sleeping on his rights because justifiably relying on others; where the Government has been unjustly enriched; and where the failure to proceed in a timely fashion was the result of incapacity.'" Id. (citing Neva Vera Barnes McQuown v. United States, 199 Ct. Cl. 858, 874 (1972) (quoting M.T. Bennett, Private Claims and Congressional References, H. Comm. Print, 90th Cong., 2d Sess. 10 (1968))). Although the congressional reference statute, 28 U.S.C. § 2509, authorizes the hearing officer to recommend whether