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Stacey v. Jewell

United States District Court, District of Alaska

March 3, 2015




Plaintiffs J. Dennis Stacey and Pelham L. Jackson (“Plaintiffs”) appeal from the decision of the Secretary of the Interior (“Secretary”) holding that stone known as “Spencer Stone” or “PR 16 graywacke” was not a locatable mineral under 30 U.S.C. §§ 21 - 54 (the “Mining Law”).[1] The matter has been fully briefed by the parties and the Court has determined that oral argument would not materially assist in reaching a decision in this matter. Accordingly, the request for oral argument at Docket 60 is DENIED, and the matter is submitted for decision on the briefs.[2]


The history and background of this action are well known to the parties and are recited herein only to the extent necessary to an understanding of this decision.

This action arises out of a contest proceeding initiated by the Bureau of Land Management (“BLM”) contesting the validity of ten placer mining claims Plaintiffs had located in the Chugach National Forest. While the validity of nine of the claims was upheld, the Administrative Law Judge (“ALJ”) held that PR 16 graywacke was a common variety building stone not locatable under the mining laws. On administrative appeal the Interior Board of Land Appeals (“IBLA”) affirmed the decision of the ALJ. Plaintiffs challenge the holding that Spencer Stone is a common variety stone in this action.


This Court has jurisdiction over appeals from the final decisions of the Secretary of the Interior.[3] The decision of the IBLA is the final decision of the Secretary for purposes of judicial review.[4]

Under the Administrative Procedure Act (“APA”), this Court must “hold unlawful and set aside agency action, findings, and conclusions of law found to be . . . arbitrary, capricious, or otherwise not in accordance with law.”[5] The scope of review under the arbitrary and capricious standard is narrow and “a court does not substitute its judgment for that of the agency.”[6] This standard requires “a rational connection between facts found and conclusions made” by the Secretary.[7]

[. . . .] Section 706(2) of the APA provides that an agency action must be upheld on review unless it is “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.” 5 U.S.C. § 706(2)(A). As a reviewing court, we “must consider whether the decision was based on a consideration of the relevant factors and whether there has been a clear error of judgment.” Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 416, 91 S.Ct. 814, 28 L.Ed.2d 136 (1971), abrogated in part on other grounds as recognized in Califano v. Sanders, 430 U.S. 99, 105, 97 S.Ct. 980, 51 L.Ed.2d 192 (1977). Although our inquiry must be thorough, the standard of review is highly deferential; the agency's decision is “entitled to a presumption of regularity, ” and we may not substitute our judgment for that of the agency. Id. at 415-16, 91 S.Ct. 814. Where the agency has relied on “relevant evidence [such that] a reasonable mind might accept as adequate to support a conclusion, ” its decision is supported by “substantial evidence.” Bear Lake Watch, Inc. v. FERC, 324 F.3d 1071, 1076 (9th Cir.2003). Even “[i]f the evidence is susceptible of more than one rational interpretation, [the court] must uphold [the agency's] findings.” Id.[8]

In the interim between time that Plaintiffs filed their application and her final decision, the Secretary adopted 43 C.F.R. § 3830.12(b) codifying the Ninth Circuit decision in McClarty.[9] This Court has determined that § 3830.12(b) applies to this case.[10] Thus, in resolving this appeal the Court must decide whether the Secretary’s decision meets the parameters of § 3830.12(b), which provides:

(b) Under the Surface Resources Act, certain varieties of mineral materials are locatable if they are uncommon because they possess a distinct and special value. As provided in McClarty v. Secretary of the Interior, 408 F.2d 907 (9th Cir. 1969), we determine whether mineral materials have a distinct and special value by:
(1) Comparing the mineral deposit in question with other deposits of such minerals generally;
(2) Determining whether the mineral deposit in question has a unique physical property;
(3) Determining whether the unique property gives the deposit a distinct and special value;
(4) Determining whether, if the special value is for uses to which ordinary varieties of the mineral are put, the deposit has some distinct and special value for such use; and
(5) Determining whether the distinct and special value is reflected by the higher price that the material commands in the market place.

With respect to the interpretation and application of agency regulations, the Ninth Circuit stated:

“When Congress has ‘explicitly left a gap for an agency to fill, there is an express delegation of authority to the agency to elucidate a specific provision of the statute by regulation, ’ and any ensuing regulation is binding in the courts unless procedurally defective, arbitrary or capricious in substance, or manifestly contrary to the statute.” United States v. Mead Corp., 533 U.S. 218, 227, 121 S.Ct. 2164, 150 L.Ed.2d 292 (2001) (quoting Chevron, U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837, 843-44, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984)). Even if the agency has not formally interpreted the statute, Chevron deference applies when it has “promulgated a rule based on an implicit interpretation of the statute.” Schleining v. Thomas, 642 F.3d 1242, 1246 (9th Cir.2011). An agency's interpretation of its own regulation is “controlling unless plainly erroneous or inconsistent with the regulation.” Auer v. Robbins, 519 U.S. 452, 461, 117 S.Ct. 905, 137 L.Ed.2d 79 (1997) (internal quotation marks omitted).[11]

While the government has the burden of proof to establish a prima facie case, once the government has met its burden, the burden of proof by a preponderance of the evidence shifts to the claimant. While the claimant does not have to establish all the elements necessary, it must preponderate on the issues raised.[12] This Court must apply these principles to the case before it.


Plaintiffs present several issues and subissues in somewhat of a “shotgun” manner.

1. The government did not sustain its prima facie case.

2. The Secretary improperly compared Spencer Stone to other deposits of armor stone.

3. The assumption that the Spencer Stone produced by Plaintiffs had unique qualities was not rebutted by substantial evidence.

4. The Secretary failed to make any finding disputing the distinct and special value for Spencer Stone.

5. The Secretary erred in finding that Spencer Stone does not have a distinct and special value in the market.

6. Supplementation of the record to include certain documents developed by the Department of Agriculture, U.S. Forest Service, related to the management of the Spencer Glacier materials.

Plaintiffs request that the decision of the Secretary be reversed with instructions that the contest ...

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