"U.S. Supreme Court Rules in Bedroc v. United States: Ownership of Western Desert Sand and Gravel Shifts to Private Sector," Crowell & Moring Mining Law Monitor, Vol. 21, Issue 1
Author: R. Timothy McCrum.
On March 31, 2004, the U.S. Supreme Court ruled in the case of BedRoc Limited LLC v. United States, narrowing the scope of reserved mineral estates owned by the United States in western lands conveyed into private ownership in the early 1900s. The specific issue in the case was whether common sand and gravel were "valuable minerals" reserved to the government in lands patented — i.e., conveyed — in 1940 pursuant to the 1919 Pittman Act, which applied only to lands in Nevada. However, the case has potential implications for the tens of millions of acres of lands patented under other federal statutes with mineral reservations. The Court reversed the Ninth Circuit in a 6-3 decision, and ruled that the sand and gravel in question was owned by the private landowner, not the federal government.
The controversy was truly a "David versus Goliath" struggle by operators of a sand and gravel quarry about sixty miles north of Las Vegas standing up against the U.S. Department of the Interior, ably represented by the U.S. Justice Department. The dispute arose in 1993 when the Bureau of Land Management ("BLM") issued notices of trespass for the extraction of common sand and gravel from land that, although privately owned, was subject to the government's reservation of valuable minerals. BedRoc contested the trespass notice, but lost before the BLM, before the Interior Board of Land Appeals, at the federal district court in Nevada, and at the Ninth Circuit. After nearly ten years in litigation, the filing a petition for certiorari to the U.S. Supreme Court was the equivalent of a Hail Mary pass at the end of the fourth quarter! The U.S. Supreme Court receives 7,000 to 8,000 petitions annually and selects less than 100 cases for review. BedRoc filed its petition on April 30, 2003, and on September 30, 2003, the Court granted the petition — much to the surprise of the Justice Department's Solicitor General's Office, which, of course, had opposed the petition.
When BedRoc petitioned for Supreme Court review, it pointed out that the case presented the opportunity to revisit the Court's 1983 decision in Watt v. Western Nuclear, which had decided a very similar issue in a 5-4 vote in favor of the federal government. In that case, the Court had ruled that common gravel was a reserved "mineral" under another statute, the Stock-Raising Homestead Act of 1916. Three of the four dissenters from the Western Nuclear case still remain on the Court: Chief Justice Rehnquist, Justice Stevens, and Justice O'Connor. No members from the Western Nuclear majority remain on the Court. The BedRoc decision by the Ninth Circuit reflected an extension of the Western Nuclear holding, because it ruled that common sand and gravel were reserved as "valuable minerals," not merely "minerals."
The Western Nuclear dissenters had reasoned that common sand and gravel were not considered to be minerals under related statutes such as the Mining Law of 1872 in published Interior Department decisions in the early 1900s, just before the 1916 statute at issue was enacted, and so they should not be reserved to the government. The Western Nuclear dissenters relied, in part, on the Leo Sheep v. United States decision authored by Justice Rehnquist in 1979, which ruled that where individuals had made sacrifices to obtain grants of public lands, ambiguities should not be construed strictly in favor of the Government. Instead, Leo Sheep held that such statutes must be interpreted in light of the condition of the country at the time of their enactment, a point that was followed by the Court in the Amoco v. Southern Ute Indian Tribe decision in 1999 regarding coal reservations and coal bed methane. Notably, the Interior Department itself recently had relied upon Leo Sheep in its October 7, 2003 Solicitor's Opinion on mill sites, which fairly construed the 1872 Mining Law in favor of mining claimants and mining patentees.
THE COURT'S RULING
In BedRoc, the plurality opinion by Chief Justice Rehnquist, who was joined by Justices O'Connor, Scalia, and Kennedy, stated that they "share[d] the concerns of the Western Nuclear dissent..." and "will not extend Western Nuclear's holding to conclude that sand and gravel are valuable minerals." Quoting from the petitioners' brief, the opinion noted that "[e]ven the most enterprising settler could not have sold sand in the desert." Stating further, the Chief Justice wrote that "[w]hatever the correctness of Western Nuclear's broad construction of the term 'minerals,' we are not free to so expansively interpret the Pittman Act's reservation." In a part of the opinion which squarely conflicts with the Court's rationale in Western Nuclear, Justice Rehnquist reasoned as follows: "It is beyond dispute that when the Pittman Act became law in 1919, common sand and gravel could not constitute a locatable 'valuable mineral deposit' under the General Mining Act.... Thus, in the unlikely event that some ambitious prospector had sought a patent from the United States in 1919 to extract sand and gravel from Pittman Act lands, the Secretary of the Interior would have flatly refused him."
The concurring opinion by Justice Thomas, in which Justice Breyer joined, stated even more emphatically that "the Court in Western Nuclear incorrectly applied its definition of 'minerals' to include sand and gravel...," and also declined to extend Western Nuclear's "faulty reasoning." However, the six Justices who ruled for BedRoc were unwilling to overrule Western Nuclear due to stare decisis principles. The dissent, authored by Justice Stevens and joined by Justices Souter and Ginsberg, also relied on stare decisis and would have followed Western Nuclear in construing the Pittman Act. However, even the dissent did not defend the soundness of Western Nuclear's reasoning.
We hope that the BedRoc case will put an end to any further extensions of the Western Nuclear decision. There are millions of acres of federal mineral estates reserved under statutes other than the Stock-Raising Homestead Act. Moreover, there are lingering questions regarding how Western Nuclear should apply to particular factual circumstances arising under the Stock-Raising Homestead Act. These questions may now be resolved on a more level playing field, with the soundness of Western Nuclear in substantial doubt.
The BedRoc case attracted three amicus briefs filed by a wide range of parties including the National Stone, Sand & Gravel Association, the Associated General Contractors of America, several western state chapters of the AGC, the Northwest Mining Association, and the Wyoming Stock Growers Association (the latter had filed a similar amicus brief in 1983 in the Western Nuclear case). The ten-year history of the case stands as a testament to the perseverance and determination which is often needed to challenge an overreaching federal bureaucracy.
[Editors' note: Tim McCrum argued the BedRoc case before the U.S. Supreme Court, with substantial assistance from Cliff Elgarten, Ellen Steen, and Dan Wolff of Crowell & Moring.]