Free Response to Motion [Dispositive] - District Court of Federal Claims - federal

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No. 95-650L (Judge Margolis)

IN THE UNITED STATES COURT OF FEDERAL CLAIMS

ALFRED ALOISI, et al., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant.

PLAINTIFFS' RESPONSE TO DEFENDANT'S MOTION TO DISMISS, OR ALTERNATIVELY, FOR SUMMARY JUDGMENT

Lawrence G. McBride FOLEY & LARDNER LLP 3000 K St., N. W., Suite 500 Washington, D.C. 20007-5143 Telephone: (202) 672-5300 Facsimile: (202) 672-5399 Dated: March 5, 2008 Attorney for Plaintiffs

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TABLE OF CONTENTS Page I. SUMMARY OF DEFENDANT'S ARGUMENTS AND PLAINTIFFS' RESPONSE..........................................................................................................................1 A. B. C. D. E. F. II. Ripeness. ..................................................................................................................1 Whether this is a tort case. .......................................................................................2 Plaintiffs' property interest in the private parcels at the time of the taking........................................................................................................................3 Penn Central factors ­ the economic impact of the agency conduct.......................3 Penn Central factors ­ reasonable investment-backed expectations.......................4 Penn Central factors ­ the character of the government's action............................4

ARGUMENT.......................................................................................................................5 A. The claim here is ripe, and not subject to dismissal on "lack of ripeness" grounds.....................................................................................................5 1. 2. 3. 4. 5. B. C. D. The two relevant facets of takings "ripeness" doctrine support Plaintiffs' claim here.......................................................................5 The issue was the owl clearance, not approval of an allphase plan of operations...............................................................................6 The claim is ripe as to the approved but stopped work................................7 The agency's rules contradict their plan-approval based ripeness argument ........................................................................................8 The owl clearance is the relevant inquiry, and that issue is fully ripe.....................................................................................................10

Defendant's conduct was actionable as a temporary taking; plaintiffs do not have and did not bring tort claims. ..............................................11 Plaintiffs had control of, and the right to mine, the private lands during the relevant period. .....................................................................................12 Application of Penn Central factors ­ the economic impact of the agency conduct.......................................................................................................14 1. "Speculative" economic impact.................................................................14 i

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2. 3. E.

Lease revenue and diminution of value .....................................................16 Permanent taking valuation versus temporary taking valuation.....................................................................................................19

Application of Penn Central factors ­ Plaintiffs' reasonable investment-backed expectations. ...........................................................................20 1. 2. 3. 4. Plaintiffs understood and managed the regulatory risks of operating here.............................................................................................20 Ready to abide by conditions in the biological opinion.............................21 Trying to Implement, But Getting Nowhere..............................................23 Applying the July 1990 Opinion's Standards ............................................25

F. III.

Penn Central factors ­ the character of the government's action. .........................28

CONCLUSION..................................................................................................................30

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EXHIBIT INDEX: Plaintiffs' Exhibit Number PE-21 PE-22 PE-23 PE-24 PE-25 PE-26 Discovery Production Number none A-163 A-168 none none FS-69

Document Identification or Description Second Affidavit of Alfred L. Aloisi Memorandum of Agreement between Robert Pincombe and Fred Aloisi (1988) Excerpts from Liberty Mining, Inc., 1989 accounting records Kathy Milne Granillo deposition transcript, October 2, 1997 Mark Williams deposition transcript, October 11, 1996 Forest Service internal faxed version of FS-69 / JA-80

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TABLE OF AUTHORITIES Page FEDERAL CASES Bailey v. United States, 78 Fed. Cl. 239 (2007) .............................................................................................................24 Bass Enterprises Prod. Co. v. United States, 54 Fed. Cl. 400 (Fed. Cl. 2002) ......................................................................................... 20-21 Bass Enterprises Production Co. v. United States, 381 F.3d 1360 (Fed. Cir. 2004)...................................................................................... 5, 20-21 Belk v. Meagher, 104 U.S. 279 (1881).................................................................................................................29 Boise Cascade Corp. v. United States, 296 F.3d 1339 (Fed. Cir. 2002)..................................................................................................5 Clipper Mining Co. v. Eli Mining & Land Co., 194 U.S. 220 (1904).................................................................................................................29 Conti v. United States, 291 F.3d 1334 (Fed. Cir. 2002) ...............................................................................................18 Cottrell v. United States, 42 Fed. Cl. 144 (1998) .............................................................................................................13 Del-Rio Drilling Programs, Inc. v. United States, 146 F.3d 1358 (Fed. Cir. 1998)................................................................................................24 First English Evangelical Lutheran Church v. Los Angeles County, 482 U.S. 304 (1987).................................................................................................................23 Florida Rock Ind., Inc. v. United States, 49 Fed. Cl. 21 (1999) ...............................................................................................................19 Hansen v. United States, 65 Fed. Cl. 76 (2005) ..............................................................................................................13 Lowe v. United States, 76 Fed. Cl. 262 (2007) .............................................................................................................13 Marks v. United States, 34 Fed. Cl. 387 (1995) ............................................................................................................18 Nicholson v. United States, 77 Fed. Cl. 605 (2007) .............................................................................................................23

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Palazzolo v. Rhode Island, 533 U.S. 606 (2001)...................................................................................................................5 Tabb Lakes, Ltd v. United States, 10 F.3d 796 (Fed. Cir. 1993)......................................................................................................5 Thune v. United States, 41 Fed. Cl. 49 (1998) ..............................................................................................................13 United States v. Etcheverry, 230 F.2d 193 (10th Cir. 1956) ..................................................................................................29 Walcek v. United States, 44 Fed. Cl. 462 (1999) ......................................................................................................18, 24 Whitney Benefits, Inc. v. United States, 18 Cl. Ct. 294 (Ct. Cl. 1989)....................................................................................................20 Whitney Benefits, Inc. v. United States, 18 Cl. Ct. 394 (1989), aff'd, 926 F.2d 1169 (Fed. Cir. 1991) .................................................17 Wyatt v. United States, 271 F.3d 1090 (Fed Cir. 2001)......................................................................................... Passim Yancey v. United States, 915 F.2d 1534 (Fed. Cir. 1991)................................................................................................19 FEDERAL STATUTES 16 U.S.C. § 1536(o)(2) ..................................................................................................................22 16 U.S.C. § 1538............................................................................................................................22 16 U.S.C. § 1539(a) .......................................................................................................................22 30 U.S.C. § 22 et seq......................................................................................................................29 REGULATIONS 36 C.F.R. § 226.4(d) ......................................................................................................................11 36 C.F.R. § 228.1 and § 228.8 .......................................................................................................16 36 C.F.R. § 228.4 .......................................................................................................................7, 26 36 C.F.R. § 228.4(d) ................................................................................................................ 10-11 50 C.F.R. § 402.14(e).......................................................................................................................7

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IN THE UNITED STATES COURT OF FEDERAL CLAIMS ALFRED ALOISI, et al., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant. ) ) ) ) ) ) ) ) ) )

No. 95-650L Hon. Lawrence S. Margolis

PLAINTIFFS' RESPONSE TO DEFENDANT'S MOTION TO DISMISS OR FOR SUMMARY JUDGMENT I. SUMMARY OF DEFENDANT'S ARGUMENTS AND PLAINTIFFS' RESPONSE. Plaintiffs break Defendant's motion and opening memorandum, for purposes of response, into six subjects, three of them the Penn Central factors for takings liability. We summarize Defendant's arguments and Plaintiffs' response here: A. Ripeness.

Defendant argues that Plaintiffs do not have a ripe taking claim because Plaintiffs never submitted a complete all-phase mining plan of operations that the Forest Service could approve under its plan regulations, 36 C.F.R. Subpart 228, and kept changing its proposals. Plaintiffs' response is threefold. First, this case is not focused on the Forest Service's failure to approve an all-phase mining plan of operations. It is focused on the Forest Service's actions and inactions in mishandling the most important clearance and review for mining in northern spotted owl country. The critical predicate for any mining plan of operations is the operator knowing, from the agency, whether plan elements will be cleared and allowed, modified or constrained, or rejected in the interaction of the plan and owl protection requirements. This is

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what the Forest Service failed to do here ­ unnecessarily, without basis and for an extraordinary period. Owl clearance is the regulatory hurdle, the permit, at issue here. Liberty went through the process to final clearance twice, so this case is ripe both under finality and unreasonable, bad faith delay analysis. Second, Defendant's lack of finality arguments based on Liberty's supposed noncooperation in supplying information on the mining details of its plans of operations is inconsistent with the Forest Service's own regulations. District Rangers must allow sequential operations, and operators on mining claims are not obligated to invent detailed plans for all phases of their operations when later phases are uncertain or dependent on the outcome of the earlier phases for which approval is being sought. Third, the Forest Service had already approved mining, the installation of a mill, and the generation of revenue from the property until this initial production and all mine development operations were shut down. Unreasonable interference with approved operations cannot be "unripe" for examination under takings standards. B. Whether this is a tort case.

Defendant argues that plaintiffs' grievances here sound in tort, and are thus not actionable in the Court of Federal Claims under the Tucker Act. This case is about uncompensated interference with the right to use property. Temporary taking jurisprudence advises that the clearest way to show ripe, actionable, extraordinary delay, as well as to show reasonable investment-backed expectations, is to demonstrate bad faith on the part of the agency. Thus temporary taking proof regularly involves claims of improper agency conduct. That legal fact does not turn temporary takings claims, such as this, into tort actions.

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C.

Plaintiffs' property interest in the private parcels at the time of the taking.

Defendant insists that plaintiffs had no cognizable property interest in the Mountain Laurel and Rollin parcels, conveyed by the United States years ago into private ownership, at the time of the taking in 1990. Defendant has misinterpreted the document production in the case, which admittedly is not complete due to the simple loss and unavailability of material that would complete earlier steps in the land transaction history. To clarify the meaning of the documentary record on this issue, Plaintiffs submit the Second Affidavit of plaintiff Alfred Aloisi to confirm that he and thus Liberty Mining held these two private parcels from 1984 forward under a mining lease-purchase agreement. He then exercised rights under the lease-purchase to acquire full fee title in 1991 in connection with a closing on a mortgage transaction that provided funds to run Liberty Mining. D.

Penn Central factors ­ the economic impact of the agency conduct.

Defendant argues that plaintiffs were not deprived of substantially all economic use of the property for two reasons: because Defendant thinks the property only has "speculative" value; and because Plaintiffs were able to realize rental income from the unpatented claims during part of the unreasonable delay period. Defendant has, however, provided nothing demonstrating whether the property's value is great or small, certain or speculative. Defendant has presented no factual basis on which it can make economic arguments about the value or lack of value of the potential mine. As to Defendant's claim that Plaintiffs still had value as demonstrated by lease revenue, the possibility of rental income is almost always there in a temporary taking. Plaintiffs present a comparison of the rental (holding) value of the property against the mining (use) value, showing that there was no "mere diminution" in value during the delay period caused by the agency's failure to deal with the owl and Liberty's mining plan. 3

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E.

Penn Central factors ­ reasonable investment-backed expectations.

Defendant argues that Plaintiffs were unreasonable to think they could ever mine in owl country, and could not have reasonable investment-backed expectations they could succeed. Plaintiffs have never sought to avoid any proper, lawful and properly administered environmental protection requirement with respect to their operations in Eddy Gulch. What Defendant does not do in its presentation, however, is explain what if any prohibitive regulatory constraint exists regarding this plan. Each time the Forest Service has acted regarding the owl (rather than stalled, failed to decide, or said it was still "working on it" without showing how or when any progress would occur), it said the Liberty 1989/1992 all-phase plan of operations was "approved" (JA-163, at 1342, three committees), or "could proceed as submitted" (JA-111, at 1084). Liberty has never received a letter, decision or other action from the Forest Service that required any modification or adjustment to the 1989/1992 all-phase plan of operations in order to accommodate restrictions that protect the owl. Liberty Mining reasonably addressed all real permitting issues affecting its mine to the crucial point of owl clearance, where the saga began. What neither plaintiffs nor any permit applicants are obligated to accept is unreasonable and extraordinary delaying action by the agency, without appropriate basis, delay that interferes with their use and nullifies the value of their property, and to have this delivered in ways that ignore agency rules, that are not called for by any resource protection standard, and complete with hidden facts and evaded procedures. F.

Penn Central factors ­ the character of the government's action.

Defendant argues that Liberty's operations are legally a "nuisance," subject to prohibition without compensation. This position is inconsistent with the Mining Law and the agency's own policies implementing the Mining Law, it is inconsistent with the Forest Service's handling of timber 4

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sales in owl country and its regulatory treatment of Liberty's mining plan as a proposed timber sale, and it is otherwise inapplicable to the facts here. II. ARGUMENT. The claim here is ripe, and not subject to dismissal on "lack of ripeness" 1. The two relevant facets of takings "ripeness" doctrine support Plaintiffs'

A. grounds.

claim here. First, whether there has been final permitting action or not, an "extraordinary delay in permit processing or bad faith on the part of the agency can give rise to a ripe takings claim notwithstanding the failure to deny the permit." Boise Cascade Corp. v. United States, 296 F.3d 1339, 1347 n.6 (Fed. Cir. 2002), citing Wyatt v. United States, 271 F.3d 1090, 1097-98 (Fed Cir. 2001). In evaluating extraordinary delay, the simple length of the delay is not determinative (see Wyatt, 271 F.3d at 1098). Rather, one examines whether the delay is disproportionate in light of the permit process in which it arises (see Bass Enterprises Production Co. v. United States, 381 F.3d 1360, 1366-67 (Fed. Cir. 2004)), or liability is established with a showing of bad faith on the part of the government. Tabb Lakes, Ltd v. United States, 10 F.3d 796, 799 (Fed. Cir. 1993). Second, "finality" in permitting does not require a final decision on all aspects of property development before governmental liability may be found. Palazzolo v. Rhode Island, 533 U.S. 606, 619-22 (2001). "Ripeness doctrine does not require a landowner to submit [permit] applications for their own sake." Palazzolo, 533 U.S. at 622. Defendant here insists the matter is not ripe because Liberty never submitted a full-detail life of mine plan of operations complete enough for the Forest Service to approve. But Palazzolo does not require that later permit. The permit here was clearance of mining the Eddy Gulch property with respect to its impacts on the owl. With respect to this permit we have both finality, and extraordinary delay and bad faith.

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2.

The issue was the owl clearance, not approval of an all-phase plan of

operations. In all their "unripe claim" arguments that Liberty's full-scale mining plan of operations was never completed, Defendant never acknowledges the plain reason the plan of operations for full-scale mining operations was never completed to the level of detail that might have satisfied the Forest Service ­ because the Forest Service behavior aborted the operation before it got there. Both the Forest Service and Liberty recognized that the big issue was the owl during this 1989-90 period, and clarity about the owl's potential impact on any operations had to be acquired before completion of a detailed plans of operations was appropriate. In other words, the Forest Service was not going to approve any mining plan of operations without first knowing and establishing what if any conditions or limitations on the proposed operation were lawfully imposed in order to protect the owl. Nor did Liberty invest in the next suite of milling equipment it intended to use, before knowing whether and how owl protection requirements would alter or stymy the planned mine development. Liberty's failure to submit detailed mining plans for the Forest Service to approve those operations ­ was a direct response to the earlier, baseless, project-killer delay of the Forest Service. The bad faith conduct included the failure to notify Liberty that the Fish and Wildlife Service concluded in July 1990 that the Liberty Mining all-phase plan would not jeopardize the owl for over a year and three quarters, in the face of a regulatory notice obligation. 50 C.F.R. § 402.14(e). The ripeness "defense" asserted here is impeached by the agencies' own conduct. The FWS had in July 1990 wholly sufficient information about Liberty Mining's plan of operations to render its biological opinion. What was relevant to both agencies for all purposes of protection of the owl was acreage of timber harvest, the board feet of timber cutting and the

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proximity of those activities to active owl nests and activity centers. See JA-76, at 750-51 (biological evaluation displaying board feet and acres of harvest); JA-80, throughout, including at 771-72. However incomplete the later phases of Liberty's all-phase mining plan may have been for purposes of final approval under 36 C.F.R. § 228.4, the Forest Service and the FWS never questioned the adequacy of that same plan information for purposes of the 1990 Section 7 consultation. The Forest Service provided the FWS exactly the same level of information for Liberty's mining plan of operations that it provided the FWS for all of the timber sales. 3. The claim is ripe as to the approved but stopped work. In arguing that

Plaintiffs' suit is "unripe," Defendant asserts that on July 23, 1990, when Plaintiffs assert the temporary taking arose, Liberty was only approved to do road work and sampling. Def. Br. 23. Defendant cites for this erroneous proposition JSOF recitals pertaining to the June 1989 plan of operations. That plan was simply irrelevant from early 1990 on. Under the District Ranger's unique and unhelpful plan "expiration" practice, that plan expired July 31, 1989. JA-26, at 425. Further, any work allowed under the June 1989 plan and not completed was carried forward in August 1989 (JA-32) and November 1989 (JA-45) approvals that became the approved elements of the October 1989 all-phase plan. The Forest Service authorized much more than road work (JA-45, at 472), including moving the existing gravity separation mill at the E T Placer Pit to Usher Flat, mining and milling of 10,000 tons of apex deposit (JA-40, at 464 Item 3), as well as dump material (JA-88, at 822), with the gravity separation equipment at Usher Flat. The approved operations the agency indefinitely aborted show that the operation was not preliminary, and the claim is ripe. An evaluation of the initial approved mining and milling operations is straightforward. Spreadsheet 9 of the Ferrero evaluation (JA-191, at 1577) displays the economics of the initial gravity separation operation here. This initial operation involved

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moving the existing Liberty gravity separation equipment from the E T Placer site up Eddy Gulch to Usher Flat, with no acquisition costs. The Forest Service approved Liberty to mine and mill 10,000 tons of Klamath and Mountain Laurel apex deposits, a specific work item in the approved sections of the October 1989 all-phase plan (JA-40, at 464, description; JA-45, at 472, approval). Spreadsheet 9 (JA-191, at 1577) provides the data for this simple calculation: processing ore with a cutoff grade of 0.10 and an average grade of 0.152 opt (Line 1, 1st column) in gravity concentration equipment with a recovery rate of 37 % (Line 1, column 4), 1 would yield $21.66 per ton of gold at the $380/oz gold price then prevailing (Line 1, column 6). Given mining costs of $12.85/ton (columns 1-3, at bottom, under "Klamath Apex Operating Costs (All tons)") and the 500 ton per day operating capacity of the existing gravity separation equipment, Liberty would have grossed $216,600 and netted $88,100 in the 20 days of test milling operation (10,000 tons /. 500 tons/day). The 10,000 tons of ore were already being mined and hauled to Usher Flat when the approved operations were shut down in January 1990. The agency's baseless actions that prevented the resumption of this previously-approved work, and the logical continuation of bulk sampling at this level with comparable results, cannot constitute an unripe claim. 4. The agency's rules contradict their plan-approval based ripeness

argument. In its unripeness arguments, Defendant relies heavily on Liberty's claimed noncooperation in providing the Forest Service the detailed and complete all-phase information it

1

The 37% recovery rate for straight gravity separation in this calculation is less than the "relatively poor gold recovery" of 40-50% from a gravity ­ flotation mill circuit, a recovery rate Defendant uses when introducing its arguments about Liberty's interest in a vat cyanide circuit that would double recovery from 40% to 80%. Def. Br. 10. The point is that even without installing the third-level milling suite, in 1989 with existing equipment, these operations made economic sense, and would immediate generate income to fund the next stages of the development program.

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demanded in order to approve all phases of these plans. Liberty regarded the details of out-year operations as unimportant for two reasons: first, it was so important to establish initial production and revenue with a working mill; and second, the Forest Service had been giving only seasonal or half-year approvals anyhow. See JA-38, at 458 ("the next six month and twelve month periods"). Beyond Liberty's focus, the agency's own rules governing hardrock mining plans directly address the issue of permitting when the course of later operations are uncertain or contingent. 36 C.F.R. § 228.4(d) provides, The plan of operations shall cover the requirements set forth in paragraph (c) of this section, as foreseen for the entire operation for the full estimated period of activity: Provided, however, that if the development of a plan for an entire operation is not possible at the time of preparation of a plan, the operator shall file an initial plan setting forth his proposed operation to the degree reasonably foreseeable at that time, and shall thereafter file a supplemental plan or plans whenever it is proposed to undertake any significant surface disturbance not covered by the initial plan. (a) Defendant relies in its ripeness argument on Mr. Ferrero's advice to the Forest Service that Liberty cannot provide the specifics of Phases 3 and 4 of its all-phase plan of operations, because they are in their details dependent on Liberty's analysis and operational adjustments derived from its completion of Phase 1 and Phase 2 of the mining plan, already partly approved. E.g., Def. Br. 7, citing Defs.' Ex. A, and JA-40 and JA-84. Mr. Ferrero's position is wholly consistent with this Forest Service plan approval regulation ­ the Forest Service must process the plan that the operator seeks approval to conduct, not demand plans the operator may or may not seek to conduct, depending on circumstances not yet established. Here, the initial development and production that would inform later work was approved, and then aborted, and their ordered cessation was unreasonably and baselessly extended by an extraordinary sequence of agency mistakes, hidden from Liberty, and then by further agency

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efforts to cover-up the mistakes and prevent the operation from restarting. Defendant's ripeness claim demands that Plaintiffs meet agency demands inconsistent with the agency's own rules. (b) Defendant tries to make much of Liberty's examination of the possibility of a vat cyanide circuit as a third element of its mill setup in Eddy Gulch (Def. Br. at 10-12, and 28). This is a red herring unripeness argument. Liberty discussed this possibility with the Forest Service. JA-65. Plaintiffs never submitted a plan of operations that proposed installation of a vat cyanide milling circuit in Eddy Gulch. E.g., JA-84 and JA-94, at 906. The Forest Service never had any obligation to process such a plan, because there never was one. With the cyanide possibility as with demands for all-phase plan detail, the Forest Service argues against its own rules, which required the Forest Service to address the plans the operator knows it will conduct. 36 C.F.R. § 228.4(d). 5. The owl clearance is the relevant inquiry, and that issue is fully ripe. This

case is not about the Forest Service's failure to approve an "all-phase" plan of operations. It is about the Forest Service's actions and inactions on the central issue that prohibited all movement toward a complete all-phase mining plan ­ applying the owl protection standards to the Liberty all-phase plan so that it could either: (a) go forward as is; (b) be modified to avoid prohibited impacts on the owl; or (c) be abandoned as impossible consistent with owl protection requirements. It was in this central element of the permit decision that the agency stalled, delayed and behaved actionably. This claim is fully ripe. On this record, had Plaintiffs been provided the July 1990 Opinion: Liberty would have funded the Arch Study; moved the gravity separation equipment already on-site at the E T Placer Pit to Usher Flat and operated, first on the 10,000 tons approved in November 1989, and then with additional bulk samples such as those the Forest Service approved in its November 1990

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plan extension and modification. 2 Instead, even though the FWS has twice rendered biological opinions concluding that Liberty's all-phase plan of operations would not cause jeopardy to the owl (and the second time around, would not adversely modify its critical habitat), the Forest Service has never taken the basic action of saying what if any conditions or limitations owl protection would require on Liberty's long-pending all-phase plans of operations. This case was ripe after the decision of the Forest Service in March 1992. It gave with one hand ­ "the FWS determined that the project could proceed as submitted" (JA-111, at 1084) ­ and took away with the other, by reinitiating consultation afresh after the first two year delay and refusing to lift a plan processing finger until the second consultation was completed. Adding to that treatment Defendant's argument that the claim is not ripe here because Liberty never got to the end of the permit line with an approvable all-phase plan of operations, the defense here is, "if we act unreasonably, delay and stall you, and hide from you the owl clearance that we both know is critical to designing your mine and committing to develop it, and if we do that early enough in the process a `ripeness' rule will let us get away with it." This is not the law. B. Defendant's conduct was actionable as a temporary taking; plaintiffs do not have and did not bring tort claims. Defendant inaccurately tries to characterize Plaintiffs' cause of action as grounded in tort rather than on an uncompensated regulatory prohibition of the use of property. Plaintiffs' demonstration that Defendant's failure to notify them of the existence of the July 1990 Biological Opinion and succeeding acts of delay were extraordinary, unwarranted and had a bad faith strain, is an appropriate or even necessary component of winning a temporary taking case.

2

JA-88, at 822: "Under your present Plan of Operations with modifications you are approved to do the following: Bulk sample the Klamath Mill dumps. Bulk sample pits at Klamath, Anna Johnson and Incline Ridge."

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This Court does not lack jurisdiction over a valid takings claim merely because an element of the Plaintiffs' claim may be characterized as tortious in nature. See, e.g., Hansen v. United States, 65 Fed. Cl. 76, 80-81 (2005) ("it is not fatal to a plaintiff's claim or this court's jurisdiction if the government alleges that the facts might give rise to a tort"). Nor does the allegation and proof of bad faith in government actions remove a takings claim from the jurisdictional purview of this Court. See Thune v. United States, 41 Fed. Cl. 49, 52 (1998) (plaintiff's allegation that a taking resulted from the unconstitutional and unauthorized action of the Forest Service was "not fatal to his taking claim because the complaint as a whole plainly assert[ed] that his property loss is traceable to authorized government action"). A takings claim will survive a jurisdictional attack if there is "some material evidence in the record that establishes the predicates for a traditional takings claim." Id. The case law Defendant cites contains no elements of the regulatory prohibition of the use of property; this case law is inapposite. The "essence" of the claims in the cases Defendant relies on here was grounded in tort, and some involve common law tort claims. The complaint in Cottrell v. United States, 42 Fed. Cl. 144 (1998), asserted among other grounds intentional and negligent infliction of emotional distress. In Lowe v. United States, 76 Fed. Cl. 262 (2007), the plaintiff alleged that specific government employees engaged in tortious and criminal conduct including negligence per se, wanton negligence, and suppression of evidence. This court has subject matter jurisdiction over Plaintiffs' temporary takings claims. C. Plaintiffs had control of, and the right to mine, the private lands during the relevant period. Defendant asserts that Plaintiffs only acquired an interest in the Mountain Laurel Mine parcel, Mineral Lot 45A, or the Rollin (or Mountain Laurel millsite) parcel in 1991, and therefore did not have a valid property interest at the time of the taking.

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Plaintiffs' Exhibit No. 1 ("PE-1"), the Aloisi Affidavit, at ¶s 7 and 9, explains how Aloisi and his associates in the early 1980s acquired interests in both the unpatented mining claims and the two private parcels from Robert Pincombe (operating as Mara Ventures) and Alexander Patterson. The PE-1 Aloisi Affidavit is perhaps not fully clear on its face that the "Eddy Gulch properties" to which Aloisi refers in its paragraph 7 include not only the unpatented mining claims held by Patterson and leased by Patterson to Pincombe / Mara Ventures, but also the two private parcels (Mineral Lots 45A and 45B), also owned by Patterson and leased by Patterson to Pincombe / Mara Ventures. To clarify this issue, plaintiffs submit the Second Affidavit of Alfred Aloisi. PE-21 (continuing Plaintiffs' exhibit numbering from their opening brief), "Second Aloisi Affidavit"). The Second Aloisi Affidavit (PE-21, at ¶s 4-7) further explains that his lease-purchase agreements with Patterson operative during the period at issue here were made in mid-1984, and the lease purchase agreement for the two private parcels in the "Agreement dated 1 June 1984" numbered "1." (PE-22-292, plaintiffs' production A-163, attached hereto). As the Second Aloisi Affidavit declares (at ¶ 7), as of 1990 Aloisi was making monthly lease payments under these lease purchase agreements. The monthly lease payments he made to Ruth Patterson, Alexander Patterson's widow, applied to the 1984 lease-purchase agreement for Mineral Lots 45A and 45B. These payments can be identified in the financial records of Liberty Mining shown in PE-23 (plaintiffs' production A-168, excerpt). Finally, the Second Aloisi Affidavit explains that in 1991, to raise funds for Liberty, Aloisi completed the purchase payment under the lease ­ purchase agreement with Patterson, and held full legal title to both parcels during that financing transaction, then transferring title to Energel, Inc. who mortgaged the title for the loans, the proceeds of which were used by Liberty.

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Aloisi / Liberty had the lease right to mine and use for mining purposes both Lot 45A and Lot 45B at the time of the temporary taking in the case. D. conduct. Application of Penn Central factors ­ the economic impact of the agency 1. "Speculative" economic impact. Defendant argues that plaintiffs cannot

show economic harm from what the agency did. Defendant asserts that the only harm plaintiffs claim is "speculative profits." Def. Br. 33. Defendant does not explain the basis on which it insists that Liberty's calculations from years of sampling, assaying, ore volume calculations and metallurgical test are "speculative." 3 Defendant has submitted no evidence regarding the mineral value of the property or its lack of mineral value of the property ­ none of any kind, so it has established no factual predicate to make any assertion on summary judgment regarding what could or could not be mined from the property (the unpatented claims and the private Mountain Laurel parcel), what the value of the property may be, or whether any value is speculative or not. Further, Defendant has not made any argument why mining operations could or would not be approved in Eddy Gulch on the property involved in this case. Defendant provides a litany of statutes and standards considered in approving a mining plan of operations and applicable to mining operations (Def. Br. 38-39). However, the only mining plans of operations involving this property on which the Forest Service has taken action in the last two decades ­ the several 1989 plans, including the first phases of Liberty's October supplemental 1989 all-phase plan, and Liberty Consolidated Mines' in 1996 (PE-16) ­ the Forest Service has approved. The northern spotted owl did not prevent either of those mining plan approvals, and plaintiffs finally
3

The government can call anything that it did not allow to happen speculative simply because it did not happen. All mine revenue projections are "speculative" in the meaningless sense of Defendant's pejorative here. Here the government prevents the use of the property in an actionable fashion, and submits there can be no liability because the property use is speculative because it did not happen.

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learned in February 1994 (JA-163), that the owl would not have prevented approval of Liberty's 1989/1992 all-phase plan of operations either. On that basis, is it not "speculation" for plaintiffs to expect that their operations, once presented in the detail required by the Forest Service, would be approved. The Forest Service's rules authorize the agency to "minimize adverse environmental impact" (36 C.F.R. § 228.1 and § 228.8), but they do not authorize the agency to say "no" to a plan of operations which otherwise meets the requirements of its rules. With their opening brief, Plaintiffs presented their calculation of the economics of the operation they had designed and would have proceeded to work to implement, once allowed to do what the Forest Service first approved in November 1989 and then aborted, and once the government might figure out, or reveal (we may not know which yet) how the agency's requirements for owl protection would prohibit or restrict mining or mine support operations within the property. See PE-2, Ferrero Affidavit. This evidence was presented for the purpose of supporting and demonstrating the validity of plaintiffs' mining claims as a predicate to this motion for summary judgment on the government's liability for a temporary taking. It was also submitted, at minimum, to demonstrate Plaintiffs' motives and understanding ­ the basis and premises on which they initiated mining operations in 1989, and submitted their all-phase mining plan of operations ­ that is, in support of their obligation to show that their investment-backed expectations were and are reasonable. Absent their making this showing, Plaintiffs would have expected Defendant to respond in their contemporaneous filing that Plaintiffs failed to making any showing on an essential element in a motion for summary judgment regarding government liability, namely, the

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demonstration they had the predicate real property interests in the unpatented mining claims to support any takings claim. 4 Even as compared with the revenues plaintiffs would have derived from bulk sampling using the then-existing gravity separation equipment (as described above), it is clear that the period of the claimed temporary taking here was one in which plaintiffs were deprived of substantially all economic use of their property. Defendant does not dispute that no mining was authorized on any of the property during the entire period from January 4, 1990 through August 5, 1996, when the LCM plan was approved (see PE-16). Likewise, no surface use except for certain road work (not involving heavy or motorized equipment, see JA-108) was authorized during this entire period. See, e.g., Whitney Benefits, Inc. v. United States, 18 Cl. Ct. 394, 40405 (1989), aff'd, 926 F.2d 1169 (Fed. Cir. 1991) (rejecting Defendant's assertion that alternate economically viable uses remained for plaintiffs' coal property, such as the right to ranch and farm). Defendant has not argued there is any other lawful use of unpatented mining claims than mining purposes, nor as a matter of fact that there is any other commercial use of the patented Mountain Laurel property (Mineral Lot 45A) other than in connection with mining ­ using the portals there to access the underground deposits. 2. Lease revenue and diminution of value. The case law cited by Defendant

is inapposite and does not provide support for the conclusion that the deprivation of substantially all economic value of a property can be remedied through the incremental monetary gain

4

Plaintiffs have agreed with Defendant that this showing, and the economic evidence involved, is solely for the purposes of proceeding with briefing and decision on the government's liability, or lack of liability, on summary judgment, and that the parties' rights and opportunity to expert discovery are deferred and reserved in connection with all subsequent proceedings in the case, including on the issue of damages.

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received from lease rental income. 5 Defendant argues that Plaintiffs' lease rental income disproves the deprivation of substantially all economic value in the property during the mining prohibition period. The WAZCO lease provided for a rental (called in its Article 5 a "Minimum Production Payment," as it is credited against actual Production Payments when those begin) beginning at $500 per month for the first two years of the Lease, and increasing in its third and succeeding years to $1000 per month. JA-158, at 1307. $6000 per year in income from these claims would barely keep a lessor in beans and rice; $12,000 is well below poverty level. The point of a mineral lease is production, and the revenues from it. WAZCO, the property's lessee, had a different plan of development for the property than Liberty Mining. It involved solely the mining of underground deposits. Whether WAZCO did so for the purpose of moving directly to the high-grade long-term target deposits for development of the Gulch, or for the purpose of avoiding the problems Liberty Mining had had with its plan initiating property development with surface operations using the old mine dumps and the exposed apex cuts, is not critical. The mining plan of operations of WAZCO (rather, of Liberty Consolidated Mines, Inc. ("LCM") after WAZCO) described their project, which the Forest Service approved in 1996 (PE16), as mining an underground ore body accessed from the May Tunnel or the Union No. 8 Adit 6

Defendant cites to a number of cases finding that substantially all economically valuable use of the plaintiff's property has not been deprived, and all of which are not applicable to this case. See Walcek v. United States, 44 Fed. Cl. 462, 467 (1999) (the cease and desist order provided plaintiffs an alternate use of their property); Conti v. United States, 291 F.3d 1334, 1344 (Fed. Cir. 2002) (sale of banned fishing equipment was possible after use of equipment was banned from use); Marks v. United States, 34 Fed. Cl. 387, 410 (1995) (plaintiff sold the majority of one of the two parcels at issue for "millions of dollars").
6

5

JA-35 (map) shows the May Tunnel, with its entry on the Mountain Laurel private parcel. JA189 (map), at 1542 shows the proximity of the Mountain Laurel and Union claim groups, the May Tunnel and the Litigation Stope. In sum, the Mountain Laurel parcel provided significant value to the lessee of the unpatented mining claims, as it contained the existing access to the underground ore body which was a target of Liberty's, and the focus of the WAZCO/LCM plan 17

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of in excess of 200,000 tons "contain[ing] gold values in excess of 0.5 Troy ounces of gold per ton", processing it through a 150 ton per day mill (at Usher Flat), and milling it with a "combination of gravity and flotation extraction" based on "tests ... achieving a 93.4% recovery of contained gold." JA-181, at 1481 and 1483. Mining half ounce ore and milling 150 tons per day at 93.4% recovery would yield 70.05 ounces of gold per day. Operating a full 30-day month and using $380/ounce as the gold price, the operation would produce $798,570 of gold per month. The WAZCO lease (JA-158, at 1307-08) provided for a 10% net smelter return to Aloisi / Liberty as lessor, in other words, $79,857 less 10% of the smelting charge per month. Comparing $500 per month while production was prohibited to something in the neighborhood of $75,000 per month contemplated by LCM's operation shows the difference between a "rental" value (merely holding the property) on the one hand and production revenues to the lessor (actually using the property for its intended purpose) on the other hand. This is no "mere diminution" in value caused by the prohibition against mining. The "residual value" of holding a property that might or might not ever be mineable due to the Forest Service's unwarranted delays in figuring out whether it could allow mining to be permitted again was less than a hundredth of the value the lessee was prepared to pay the lessor when the prohibition would be removed and the property put to its intended (and only) lawful use, mining activity. See Florida Rock Ind., Inc. v. United States, 49 Fed. Cl. 21 (1999), where a 73% diminution in value was found substantial for purposes of federal liability ($10,500 before to $2,822 after per acre appraised values). Similarly, in Yancey v. United States, 915 F.2d 1534 (Fed. Cir. 1991), the Court of Appeals upheld the trial court's decision, rendered applying the Penn Central

of operations. See PE-21, Second Aloisi Affidavit, ¶ 15, with respect to the Mountain Laurel property's value.

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factors, that compensation was owed a turkey farmer who suffered a 77% diminution in the value of his turkey flock under a quarantine slaughter order. 3. Permanent taking valuation versus temporary taking valuation. Defendant

asserts that Plaintiffs have shown no economic loss, as the "gold remains in the ground." Yes it is still in the ground. But the damages here are the time value of money based on the delay in its realization by the property owner, due to the actionable and unwarranted delay Defendant caused in Plaintiffs' being allowed to realize the income from the property. As this Court held in Whitney Benefits, Inc. v. United States, 18 Cl. Ct. 294 (Ct. Cl. 1989), in appropriate cases, especially in valuing mining properties, the comparable sales or rental income approaches used in residential and commercial real estate sales may be inappropriate and a discounted cash flow or income approach may be appropriate. The cash flow method of property valuation was used in connection with a mineral property in Bass Enterprises Prod. Co. v. United States, 54 Fed. Cl. 400, 404 (Fed. Cl. 2002), where a temporary taking was valued adjusting the cash flow valuation by the period of the actionable delay and "appl[ying] an interest factor to the lost cash flow." 7 Defendant's suggestion that because the property here continues to have economic use after the temporary taking no damages are due is inconsistent with Bass Enterprises, with all economic theory regarding the time value of money, and with the Fifth Amendment grounding of

7

Defendant uses plaintiffs' allegation of the damages amount in their 1995 complaint. Def. Br. 34. First, for purposes of the arguments in support of Defendant's Motion to Dismiss, Defendant must take the allegation of the complaint to be true. Second, for purposes of the Defendant's arguments in support of their Motion for Summary Judgment, Defendant has submitted not one bit of data or evidence that refutes either Plaintiffs' 1995 allegation or Plaintiffs' 2008 showing of the estimated value of the mining operation intended by Plaintiffs at the time they were stopped (see JA-191, and PE-2, Ferrero Affidavit). Third, plaintiffs filed this complaint so long ago that it pre-dates the Federal Circuit's decisions in Bass Enterprises clarifying the method of valuing property damages in temporary takings cases, as opposed to the methods of valuing fair market value of title in permanent taking cases.

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temporary taking jurisprudence ­ the provision of just compensation for public use of private property, even if the public use is temporary. Defendant ventures no calculation of the time-value of the deferral for four years of income of the kind analyzed and calculated in JA-191 and explained in the Ferrero Affidavit (PE-2), adjusted by applying "an interest factor to the lost cash flow." It is a substantial amount, perhaps not to the government, but to plaintiffs. Nor does Defendant cite any case that holds that there is a de minimis dollar amount below which regulatory takings are not compensable under the Tucker Act. E. Application of Penn Central factors ­ Plaintiffs' reasonable investmentbacked expectations. 1. Plaintiffs understood and managed the regulatory risks of operating here.

A property owner may have reasonable investment-backed expectations that allow for the timely use of its property, despite a complex regulatory regime. See Bass Enterprises, 54 Fed. Cl. at 403. A delay that is "disproportionate to the regulatory permitting scheme from which it arises" is not foreseeable, regardless of the complexity of the regulatory regime. See Bass Enterprises, 381 F.3d at 1366, citing Wyatt, 271 F.3d at 1098. Defendant attacks plaintiffs thus, "Plaintiffs' expectation that they could stake out a mining claim within the KNF and immediately begin extensive mining activities is clearly unreasonable." Def. Br. 39. What is clearly unreasonable is Defendant's characterization of plaintiffs' conduct and expectations. The record is undisputed that Liberty voluntarily agreed with the District wildlife biologist in 1989 to significantly alter and limit its operating plans to accommodate the Forest Service's concerns about owl protection, before the owl was listed as threatened. PE-1, Aloisi Affidavit, ¶ 20; PE-2, Ferrero Affidavit, ¶s 20-22. The record is also undisputed that even before the owl was designated as threatened, plaintiffs did not rush to

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resume operations in early 1990, and they waited to complete the Arch Study, with work stopped, to learn what restrictions might lawfully constrain Liberty's operation based on the listing of the owl as threatened, in light of its then-fresh listing as threatened and the understanding some kind of Section 7 consultation with the FWS was going to be required on Liberty's all-phase plan of operations. Defendant's attack characterization carries no citation or reference to the record of this case; there is none available to support that view of Plaintiffs. 2. Ready to abide by conditions in the biological opinion. (a) In arguing that

Plaintiffs assumed the regulatory risk they might not be able to operate in owl country, Defendant relies on the "conditions" in the FWS's July 1990 Biological Opinion (JA-80). Def. Br. 16. Defendant insists that the projects cleared by that biological opinion were only cleared subject to conditions, "reasonable and prudent measures" (in the phrasing of Section 7 of the ESA governing biological opinions), and the terms and conditions of the biological opinion authorizing the "incidental take" 8 of owls. On this record, the Forest Service never applied these reasonable and prudent measures, and conditions for authorized incidental takings of owls (JA-80, at 770-71) to Liberty, period. Clearly, these mandatory conditions have never been applied by the Forest Service to require any change or limitation in Liberty's all-phase plan of operations. When the District Ranger in early 1992 finally admitted the existence of the 1990 biological opinion, he informed Liberty that the "Fish and Wildlife Service determined that your project could proceed as submitted." JA-111, at 1084. No conditions, no restrictions, no areas out of bounds. The District Ranger then
8

Section 9 of the Endangered Species Act prohibits agencies or individuals from "taking" a threatened or endangered species ­ harassing, interfering with breeding behavior, or killing an individual of the species ­ unless that taking occurs under a "take" permit issued consistent with Section 10(a) of the Act, or as provided in Section 7(o)(2) of the Act, consistent with a "written statement" that is part of a biological opinion. 16 U.S.C. § 1538, 16 U.S.C. § 1539(a), and 16 U.S.C. § 1536(o)(2), respectively.

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demanded a new mining plan of operations, and upon its receipt, reinitiated consultation with the FWS on that "new" plan, but that is the extraordinary delay saga set out in Plaintiffs' Opening Brief. The point here is that, although the District Ranger never allowed Liberty the benefit of it, he did characterize it as giving Liberty's operations clearance regarding the owl ­ "proceed as submitted." (b) Defendant argues that the delays here were not "extraordinary" within the meaning of the temporary takings case law. Def. Br. at 27-29. Defendants cite cases ruling that delays of "approximately eight years" have been condoned as not actionable, quoting Wyatt v. United States, 271 F.3d 1090, 1098 (Fed. Cir. 2001), and cases cited there. However, Defendant acknowledges that "the nature of the permitting process as well as the reasons for the delay" are central to the analysis whether an agency's delays are actionable as temporary takings or not. Def. Br. at 28, citing Wyatt, 271 F.3d at 1098. In clear contradiction of the preceding argument, in Part II.D of its brief Defendant asserts that "failure to act" cannot be actionable at all under the Tucker Act. Def. Br. 30-31. The two arguments cannot occupy the same space. Defendant does not explain how this argument is consistent with First English Evangelical Lutheran Church v. Los Angeles County, 482 U.S. 304 (1987), and the cases such as Wyatt delineating when agency delay and inaction is actionable under the Tucker Act. This argument is inconsistent with their other delay arguments, and the cases cited are not applicable. 9 None of the cases cited in Part II.D of Defendant's brief deal

9

Nicholson v. United States, 77 Fed. Cl. 605 (2007), involves the distinct jurisprudence of the flooding cases. More to the point, its holding regarding the need for some government action pertains to a situation where there is no permitting relationship between the agency and the plaintiff. The realm of temporary takings law is wholly in the context of the relationship between the permitting agency and the property owner dependent on the permit for his lawful use of his property. And in the realm of temporary takings law, excessive and extraordinary delay is actionable, Nicholson notwithstanding.

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with temporary taking claims, and none of them casts any doubt that the relevant case law here is Seiber, Wyatt, Bass Enterprises, and the other cases analyzing delay (failure to act, indecision, bumbling) under First English and the Tucker Act. 3. Trying to Implement, But Getting Nowhere. Plaintiffs' Opening Brief

details how extraordinary the delays in dealing with the owl were here, and how tinged with bad faith the Forest Service's course was. In Defendant's Opening Brief (at 16), a topic heading is, "The Forest Service Tries To Implement the Biological Opinion." The "we tried" content here helps Plaintiffs; it highlights the strange course of hidden action, inaction, bad faith and inexplicable failure of the Forest Service ever to deal squarely with the applicant on the applicant's project. 10 To start, the Forest Service tried to implement the opinion while keeping Liberty in the dark. The regulations prohibit "trying to implement" that way. 50 CFR 402.14(e) directs that the applicant be provided the biological opinion. 11 It is simply clear that this all would have turned out quite differently if the agencies: had not ignored the notification requirement in the first place; and had not thereafter acted to hide the opinion in an unwarranted and unreasonable delay that was hidden from Liberty as it occurred. This case is thus the opposite of Walcek, 44 Fed. Cl. at 468, and Wyatt, 271 F.3d 1090, 109899 (Fed Cir. 2001), where the permit applicants' avoidance of the agency or failure to provide requested information undermined their taking claims. Here Liberty kept asking to engage on the outcome of the owl consultation, and was met with unspecific evasions that there was no word on the owl.
11 10

In its note 24, Defendant asserts that Plaintiffs must concede the legality of the government's conduct in order to bring a jurisdictional takings claim. This Court recently ruled in Bailey v. United States, 78 Fed. Cl. 239 (2007), citing and relying on the Federal Circuit's decision in DelRio Drilling Programs, Inc. v. United States, 146 F.3d 1358, 1363 (Fed. Cir. 1998), that a takings claim cannot be defeated merely on grounds that the property owner asserts that the government's action was invalid or unlawful ­ "A claim in our court for just compensation due to a taking is not defeated merely because a property owner believes that the government action that allegedly took his property was for other reasons invalid ­ or even because he goes so far as to challenge its validity. ... A property owner is free to attempt to invalidate a government decision and also to seek compensation if he alleges that decision resulted in a taking." Bailey, 78 Fed. Cl. at 253-56 (citations omitted).

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Defendant introduces excerpts from the deposition of Kathleen Milne Granillo (Def. Ex. D), who described that she arrived in the Klamath National Forest Supervisor's Office as the July 1990 biological opinion was issued. PE-24, at p. 8. She agreed that the July 1990 Opinion was "a big deal in the forest supervisor's office", and it was "the task of the week or weeks to see it implemented." PE-24, at pp. 14-15. Likewise, Mark Williams, the Ranger District biologist with whom Liberty worked out the 1989 owl mitigation of its earlier all-phase plans, testified that the arrival of the July 1990 biological opinion in the District Office "was a watershed. When this came back, it was general knowledge. Everyone was anticipating this." PE-25, at p. 21. One version of the July 1990 biological opinion Defendant produced (PE-26, a version of JA-80), contains the fax transmission print line at its top, showing transmission by fax from the Forest Service's Region 5 ("R5 FS RO") to the Klamath National Forest July 26, 1990. The Regional Office made sure that the District Office got right on the "big deal," "watershed" task of implementing the opinion. The District Office got right on it, except as to Liberty's all-phase plan of operations. Defendant's best argument that the Forest Service was trying hard to evaluate the Liberty plan against the owl's requirements is deposition testimony of Ms. Milne Granillo that she visited Eddy Gulch nearly a year after the July 1990 Biological Opinion. Def. Br. 17, and Def. Ex. D. So the Forest Service gets around to considering Liberty a year later? Equally telling is that Ms. Milne Granillo's visit to the site led to nothing, resolved nothing, and provided no information or advice to Liberty. There is no document of any kind tied to Ms. Milne Granillo before or after her visit supporting Defendant's assertion that she did anything regarding the Liberty plan of operations in 1990 or 1991, much less anything that moved the project forward in any way.

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The most specific reference to any active anything regarding Liberty is in the District Ranger's August 27, 1990, letter, "The determination of how your operation will affect and how it will be affected by the Habitat Conservation Area (HCA) has not been completed by the [FWS]. The report is not scheduled to be issued by the [FWS] until September first of this year." JA-82, at 777. However, no such determination was ever provided to Liberty, and on the record of this case none was prepared, even though the "report" was expected only five days after the letter announcing there would be a "report." 4. Applying the July 1990 Opinion's Standards. The "we tried" is hollow in

another respect; there is no document from 1990 through to early 1992 (when critical habitat was designated) showing anyone applying the July 1990 Opinion's mandatory conditions for incidental take (harming, disturbing nesting, etc.) of owls in projects cleared by the biological opinion. Assume the Forest Service was implementing the ISC Conservation Strategy on July 23, 1990, and thereafter. The ISC Report, dated May 1990 (JA-71, at 679), directs that "mining activities should be reviewed case by case for approval by the interagency body organized to review implementation of this conservation strategy." There is no evidence in this record that the Forest Service ever submitted this mining activity to any interagency body in 1990, 1991 or 1992. They did so sometime in early 1993 (see JA-163, at 1342), two and a half years after the biological opinion, but only in connection with the reinitiated consultation. And when that review of Liberty's 1989/1992 all-phase plan of operations finally occurred, the FWS reported that "the [Interagency Technical Review Team/Interagency Northern Spotted Owl Conservation Group and two other] groups have

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determined that the proposed Liberty Mine complies with current direction, court mandates, and regulations." Id.
12

By including the Liberty Mining project in its June 1990 Biological Evaluation and Section 7 consultation for proposed timber sales, the Forest Service determined that the Liberty Mining plan of operations was appropriately treated under the Forest Service's silviculture standards ­ "The purpose of this biological evaluation is to determine the potential effects of the Klamath National Forest (KNF) planned timber sale program on