Brimstone Natural Resources v. Haight

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF OREGON

MEDFORD DIVISION

BRIMSTONE NATURAL RESOURCES Case No. 1:18-cv-01740-CL

CO., an Oregon corporation; JOHN WEST, an

individual; ROBERT STUMBO, an

individual OPINION & ORDER

Plaintiffs,

v.

DAVID HAIGHT, an individual; STEPHEN

WETMORE, individually and in his official

capacity, DOUGLAS THACKERY,

individually and in his official capacity;

OREGON DEPARTMENT OF

FORESTRY, a government agency; PETER

DAUGHERTY, State Forester, Oregon

Department of Forestry, in his official capacity;

OREGON DEPARTMENT OF

ENVIRONMENTAL QUALITY, a

government agency; RICHARD WHITMAN,

Daca 1 ODITTON & ARDNHLGP

Director of the Oregon Department of

Environmental Quality, in his official capacity;

OREGON DEPARTMENT OF FISH AND

WILDLIFE, a government agency; CURT

MELCHER, Director of the Oregon

Department of Fish and Wildlife, in his official

capacity; DOES 1-10, individually and/or in

their official capacities.

Defendants.

CLARKE, Magistrate Judge.

Plaintiffs Brimstone Natural Resources Co., John West, and Robert Stumbo request

declaratory relief for preemption, void for vagueness, contract rights, substantive and procedural

due process, and equal protection issues. Second Am. Compl. ff 1-7 (#26). Additionally,

Plaintiffs request monetary relief for alleged procedural due process and equal protection

violations, each claim alleging one million dollars in damages. Jd. 4 VIII-IX. Plaintiffs also

allege an unconstitutional taking without just compensation and seek one million dollars in

damages. Jd. J] 6; VII. The Court has jurisdiction over this action pursuant to 28 U.S.C. § 1331

because the asserted claims include a federal question arising under 42 U.S.C. § 1983.

This matter comes before the Court on a Motion to Dismiss (#29) filed by Defendants

David Haight, Stephen Wetmore, Douglas Thackery, Curt Melcher, Peter Daugherty, Richard

Whitman, the Oregon Department of Forestry, the Oregon Department of Environmental

Quality, and the Oregon Department of Fish and Wildlife (“Defendants”). For the reasons below,

Defendants’ motion is GRANTED. Defendants have also filed a Motion for Judicial Notice

(#30). Plaintiffs do not contest the motion, and it is GRANTED. The parties have entered full

consent to Magistrate Judge jurisdiction pursuant to 28 U.S.C. § 63 6(c)(1).

STANDARD

Pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure, a motion to dismiss

will be granted where the plaintiff fails to state a claim upon which relief may be granted. In

order to state a claim for relief, a pleading must contain “a short and plain statement of the claim

showing that the pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). “A motion to dismiss under

Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim upon which relief can be

granted ‘tests the legal sufficiency of a claim.’” Conservation Force v. Salazar, 646 F.3d 1240,

1242 (9th Cir. 2011) (quoting Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001)).

Dismissal under Rule 12(b)(6) is proper “if there is a ‘lack of a cognizable legal theory or

the absence of sufficient facts alleged under a cognizable legal theory.’” Jd. (quoting Balistreri v.

Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 1988)). “To survive a motion to dismiss, a

complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is

plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v.

Twombly, 550 U.S. 544, 570 (2007)). When evaluating a motion to dismiss, the court may first

identify and strike allegations that are mere legal conclusions. Jd. However, the court must

accept allegations of fact as true and construe those allegations in the light most favorable to the

non-moving party. Id.; Odom v. Microsoft Corp., 486 F.3d 541, 545 (9th Cir. 2007) (internal

citations omitted).

In general, a court cannot consider any material outside the pleadings when ruling on a

motion to dismiss unless the motion is treated as one for summary judgment and the parties are

“given reasonable opportunity to present all materials made pertinent to such motion by Rule

56.” Lee v. City of Los Angeles, 250 F.3d 668, 688 (9th Cir. 2001) (quoting Fed. R. Civ. P.

12(b)(6)). However, there are two exceptions to this rule. Jd.

D...92 UADTRTART BADKTD

First, a court is not required to convert a motion to dismiss into a motion for summary

judgment if it is merely considering “material which is. properly submitted as part of the

complaint.” Jd. (internal citations omitted). Such materials may include documents specifically

referred to and relied upon in the complaint, so long as the authenticity of the documents is

uncontested. Jd. Second, a court may take judicial notice of “matters of public record” under

Federal Rule of Evidence 201. Jd. at 689 (quoting Mack v. South Bay Beer Distrib., 798 F.3d

1279, 1282 (9th Cir. 1986)). Rule 201 enables the court to take judicial notice of facts that are

“not subject to reasonable dispute” because they are (1) “generally known within the trial court’s

territorial jurisdiction,” or (2) “can be accurately and readily determined from sources whose

accuracy cannot reasonably be questioned.” Fed. R. Evid. 201(b). For instance, a court may take

judicial notice of records and reports of administrative bodies. See Anderson v. Holder, 673 F.3d

1089 (9th Cir. 2012) (taking judicial notice of second appeal and merging it with earlier appeal).

BACKGROUND

Plaintiffs John West and Robert Stumbo are fifty percent shareholders of Plaintiff

Brimstone Natural Resources Co. (“BNR”), an Oregon corporation that owns property located

along Dog Creek (“Dog Creek Property”) and Brimstone Road (“Brimstone Property”) in

Josephine County, Oregon. Second Am. Compl. ff 13-15, 28-29 (#26). Only the Brimstone

Property appears to be at issue in this case. As alleged, the Brimstone Property originates in a

land patent issued in 1883 under the authority of the 1820 Land Act and supplemental

legislation. Jd. | 33. Plaintiffs believe there is gold on the property and intend to conduct a

mining operation to retrieve it. Id. Jf 27, 38.

In order to conduct their gold mining operation as they envisioned it, Plaintiffs harvested

several trees in the riparian management area of the Brimstone Property during the summer of

DA ANTTaA,AT OBOADKRTD

2013. Ex. 101 at 7 (#30); see Second Am. Compl. { 72 (#26). They sold this timber

commercially in violation of the Oregon Forest Practices Act (OFPA). Ex. 101 at 7 (#30); OAR

629-600-0050. In response to public complaints about the timber harvest, the Oregon

Department of Forestry (ODF) investigated the property in September 2013. Ex..101 at 8 (#30).

ODF Forester, Stephen Wetmore, found Plaintiffs had removed several trees in the riparian

management zone of the property. Jd. Defendant Wetmore issued citations (#13-SW022, #13-

SW023, and #13-SW024; “2013 Repair Orders”) requiring Plaintiffs to cease further harvesting

operations and repair damage by replanting and maintaining new trees on the property. Ex. 101

at 9-10 (#30); Second Am. Compl. { 69 (#26). Plaintiffs requested an administrative hearing to

contest the citations. See Ex. 101 at 3 (#30).

An administrative hearing was held on November 21, 2013. Ex. 101 at 3 (#30). The

Administrative Law Judge (“ALJ”) concluded that Plaintiffs had failed to retain trees in the

riparian management zone in violation of the OFPA. Ex. 101 at 13 (#30). The ALJ also

considered and ultimately rejected Plaintiffs’ argument that the Mining Act of 1872 (“The

Mining Act”), 30 U.S.C. §§ 22-54, and the federal mining patent for Brimstone Property

preempted the OFPA, Ex. 101 at 17-20 (#30). The ALJ issued a Final Order affirming citations

#13-SW023 and #13-SW024, which required Plaintiffs to cease further violation and repair

damages on the land by replanting approximately 500 trees and maintaining them for four years.

Ex. 101 at 11-12, 25 (#30) (413-SW022 was not at issue in this hearing). According to the

administrative record, Plaintiffs have not yet complied with the Repair Order. Ex. 103 at 2 (#30).

During the November hearing, defendant Wetmore also indicated that Plaintiffs could

avoid some of the 2013 Repair Order requirements if they submitted and gained approval for a

Plan for Alternate Practice (“PFAP”). Second Am. Compl. J 71 (#26); Ex. 102 at 11 (#30); OAR

Dane £ __ OPINION & ORNERP

629-605-0173. Although the OFPA’s purpose is to preserve forestland properties such as the

Brimstone Property, 44 ORS § 527.630, the legislation allows for the possible conversion of

forestland to other uses through the PFAP process, 44 ORS § 527.730; OAR 629-605-0173.

PFAPs are commonly approved to convert forestland to agricultural uses; however, before this

case, ODF staff had not encountered a PFAP application for converting forestland to mining

purposes. Ex. 102 at 11 (#30).

Plaintiffs allege that, in reliance on Mr. Wetmore’s statements, they abandoned their

appeal of the 2013 Repair Orders and pursued a PFAP. Second Am. Compl. { 71 (#26). Plaintiffs

met with Mr. Wetmore in May 2014, at which time Mr. Wetmore encouraged them to show

reasonable progress toward conversion of the property by submitting a written PFAP application.

Id. 84; Ex. 102 at 11 (#30). Despite this meeting, Plaintiffs did not submit a written PFAP

application until November 2014, more than twelve months after they learned of this option. Ex.

102 at 11 (#30). Plaintiffs have not yet been approved for a PFAP and allege they were informed

the application had expired on March 6, 2015, Second Am. Compl. { 95 (#26), and on December

31, 2015, id 491.

At a subsequent hearing regarding all three citations, the ALJ issued a civil penalty of

$4,950 against Plaintiffs. Ex. 102 at 14 (#30). In January 2016, Defendant ODF issued an order

prohibiting further commercial timber operations by Plaintiffs until the fines were paid and either

reforestation occurred or a PFAP was approved (“Order to Prohibit’). Ex. 103 at 2 #430). In

response, Plaintiffs commenced this action, alleging that Defendants abused their authority in

order to prevent Plaintiffs from acting on their plans to mine. Second Am. Compl. {fj 100-104

(#26). Plaintiffs also allege that Defendants fabricated impossible and variable requirements to

£ NMDA 8B AYPNUYD

obtain approval for a PEAP and, in doing so, have limited the use of Plaintiffs' property to

forestland. Jd.

DISCUSSION

Plaintiffs contend the following: (1) The OFPA, as applied in this case, is preempted by

federal mining laws, Second Am. Compl. J 118 (#26); (2) Defendants’ actions have infringed

upon a heretofore unrecognized “fundamental property right” of individuals “to use and develop

their property as they choose” in violation of the 14th Amendment, id. J 123-26; (3) the OFPA,

as applied in this case, is void for vagueness and thus unconstitutional, id. 7 132; (4) Defendants’

actions have infringed on Plaintiffs’ right to freedom of contract in violation of Article I § 10 of

the Constitution, id. § 137; (5) Defendants have violated Plaintiffs’ Sth and 14th Amendment

rights to due process rights by “depriving Plaintiffs of their constitutionally protected property

rights and providing no reasonable notice or opportunity to be heard,” id. JJ 143-43; (6)

Defendants violated the Equal Protection Clause of the 14th Amendment by “singling Plaintiffs

out for intentional and arbitrary discrimination, [sic] because of personal animus toward

Plaintiffs,” id. □□ 146-47; and (7) Defendants’ actions constitute an “as applied” taking in

violation of 42 USC § 1983, id. ¥ 153. Furthermore, Plaintiffs allege that defendants Thackery,

Haight, Wetmore, and Does 1-10 have, in their individual capacities, violated Plaintiffs’

procedural due process and equal protection rights. Jd. J] 156, 161.

As apreliminary matter, Plaintiffs have not alleged that they have exhausted all

administrative remedies. The doctrine of exhaustion of administrative remedies “provides ‘that

no one is entitled to judicial relief for a supposed or threatened injury until the prescribed

administrative remedy has been exhausted.’” McKart v. U.S., 395 U.S. 185, 193 (1969) (quoting

Myers v. Bethlehem Shipbuilding Corp., 303 U.S. 41, 50-51 (1938)). “The basic purpose of the

Doo OAR. oAnnNeTnN

doctrine of exhaustion of administrative remedies is to allow an administrative agency to

perform functions within its special competence to make a factual record, to apply its expertise

and to correct its own errors so as to moot judicial controversies.” Aleknagek Natives Ltd. v.

Andrus, 648 F.2d 496, 499 (9th Cir. 1980). “If a statute does not provide for exhaustion of

administrative remedies, a district court may require exhaustion in the exercise of its discretion.”

Porter v. Board of Trustees of Manhattan Beach Unified School Dist., 307 F.3d 1064, 1070 (9th

Cir. 2002).

Though exhaustion of administrative remedies is typically required as a condition of

judicial review, courts have allowed exceptions when exhaustion does not serve the purposes of

the doctrine or the particular administrative scheme involved. Andrus, 648 F.2d at 499. Thus,

exhaustion is not required in the following circumstances: (1) if the prescribed administrative

remedies are “inadequate or not efficacious,” (2) if “pursuit of administrative remedies would be

a futile gesture,” (3) if “irreparable injury will occur” without immediate judicial review, or (4) if

an administrative proceeding would be void. Id.

It is not disputed in this case that Plaintiffs have failed to exhaust the available

administrative remedies. First, as alleged in the complaint, Plaintiffs had the option to appeal the

2013 Repair Order, but they abandoned their appeal to pursue a PFAP. Second, according to the

administrative record, Plaintiffs had the opportunity to request a hearing regarding the 2016

Order to Prohibit within 30 days of its issuance, Ex. 103 at 2 (#30), but Plaintiffs have not

alleged that they did so. Furthermore, Plaintiffs have not alleged any of the aforementioned

exceptions to the doctrine of exhaustion of administrative remedies.

This Court exercises its discretion to require exhaustion of administrative remedies in this

case. Therefore, since Plaintiffs do not contend that they have exhausted all prescribed

administrative remedies, Plaintiffs’ Complaint does not properly allege entitlement to the

requested relief. Moreover, as discussed below, Plaintiffs’ Complaint fails to state a claim upon

which relief can be granted.

I. The OFPA is not preempted by the Mining Act.

Plaintiffs allege that the OFPA, as applied through the Order to Prohibit, conflicts with

the Mining Act and is thus preempted by federal law. Conflict preemption arises where a state

law “actually conflicts with federal law [such that] it is impossible to comply with both state and

federal law . . . or where the state law stands as an obstacle to the accomplishment of the full

purposes and objectives of Congress.” California Coastal Comm'n vy. Granite Rock Co., 480 US.

572, 582 (1987) (“Granite Rock’).

a. Federal mining laws do not preempt a state’s reasonable environmental

regulations.

To allege preemption, Plaintiffs rely on the Mining Act, which provides:

[A]ll valuable mineral deposits in lands belonging to the United

States, both surveyed and unsurveyed, shall be free and open to

exploration and purchase, and the lands in which they are found to

occupation and purchase, by citizens of the United States....

30 U.S.C. § 22. As passed in 1872, the Mining Act “expressed no legislative intent on the as-yet

rarely contemplated subject of environmental regulation.” Granite Rock, 480 U.S. at 582.

The United States Supreme Court has held that federal mining laws and

environmental regulations do not preempt reasonable state environmental laws that restrict

mining activities on federal land.' Id. In Granite Rock, the state law at issue was a permitting

' In Plaintiffs’ Response to Defendants’ Motion to Dismiss (#33), Plaintiffs attempt to distinguish the

present case from Granite Rock, claiming that the Supreme Court’s holding in that case applied only to

unpatented claims on federal land. However, if the Mining Act applies to the Brimstone Property, then

Granite Rock also applies. If Granite Rock does not apply, the Mining Act does not apply, and

preemption would be impossible. In either scenario, this claim should be dismissed.

regulation that required a mining company, which had already submitted an approved five-year

plan of operations to the Forest Service, to secure a permit from the California Coastal

Commission before undertaking any development, including mining. /d. at 577. The mining

company immediately filed an action alleging that the permit requirement was preempted by

federal regulations. /d. The Court held the Mining Act and other federal Forest Service mining

regulations were not intended to preempt the imposition of reasonable state environmental

regulations on mining claims. /d. at 583. Moreover, the regulations “expressly contemplate

coincident compliance with state law as well as with federal law.” Jd. at 584.

As discussed below, the OFPA is a reasonable environmental regulation. Moreover, the

OFPA does not preclude mining, either facially or as applied through the Order to Prohibit.

Therefore, under Granite Rock, federal mining laws do not preempt the OFPA, and Plaintiffs’

preemption claim is not cognizable.

b. The Oregon Forest Practices Act (OFPA) is not facially preempted because it

is reasonable state environmental regulation.

Although the Mining Act is silent on the subject of environmental regulation, Congress

has since recognized that both federal and state governments have a responsibility and a right to

minimize adverse environmental impacts through reasonable environmental policies. 30 U.S.C. §

601 et seq.; 36 C.F.R. §§ 228 .1, 228.3(d); 42 U.S.C. §§ 4331(a), 4371(b)(2). Pursuant to this

right, the state of Oregon enacted the Forest Practices Act, which sets forth various forest

regulations to achieve Oregon’s declared policy

to encourage economically efficient forest practices that ensure the

... Maintenance of forestland ... consistent with sound management

of soil, air, water, fish and wildlife resources and scenic resources

... and to ensure the continuous benefits of those resources for future

generations of Oregonians.

44 ORS § 527.630.

Not only does the OFPA have a clear environmental purpose, the subsequent regulations

promulgated by Oregon’s Department of Forestry are also tailored to that purpose. Bohmker v

Oregon, 903 F.3d 1029, 1044 (9th Cir. 2018) (noting Gregon Senate Bill 3 was environmental

regulation, not land use planning, for the same reasons). To encourage the maintenance of forest

resources, the OFPA requires that private owners of “forestland” comply with state permitting

requirements before conducting any commercial operation relating to the “establishment,

management, or harvest” of forest tree species, including the Douglas Fir and Ponderosa Pine. 44

ORS §§ 527.620(12); 527.670(6)-(7). Additionally, the Board of Forestry established specific

riparian protections for operations occurring near streams. OAR 629-640-0100. These

regulations are in place to ensure the maintenance and protection of Oregon’s natural resources,

not to prohibit any land use planning schemes, including those for mining uses.

Because the OFPA is not intended to “prevent the conversion of forestland to any other

use,” 44 ORS § 527.730, forestland owners who wish to conduct commercial operations that are

not contemplated in the OFPA have the opportunity to propose a Plan for Alternative Practice to

the Department of Forestry, OAR 629-605-0173. This plan must be approved by the State

Forester before the operation commences. Jd. at (5). Ifa forestland owner fails to submit or

comply with a PFAP, or otherwise violates the OFPA, the State Forester has the authority to

issue citations; order owners to make reasonable efforts to repair the damage; and prohibit

owners from conducting new operations on any forestland until repairs, fines, and other

conditions are resolved. 44 ORS § 527.680.

_ For these reasons, the OFPA is a reasonable environmental regulation. Additionally, the

OFPA does not ban mining, nor does it mandate particular uses of the land. To the extent that the

OFPA, as here, regulates commercial lumber harvesting activities in areas sought to be mined,

the OFPA indirectly affects mining. However, in intent and in effect, the OFPA does not

preclude Plaintiffs from mining. Plaintiffs’ mining rights—whatever they may be—remain

intact, albeit within the constraints of Oregon’s regulatory scheme. Therefore, the OFPA is not

facially preempted by the Mining Act.

c. The OFPA, as applied through the Order to Prohibit, does not preclude

mining.

As discussed above, the OFPA, is a reasonable environmental regulation that is not

facially preempted. Likewise, the OFPA, as applied through the Order to Prohibit, does not

preclude Plaintiffs from mining. First, the text of the Order to Prohibit says nothing about

mining. Rather, the Order to Prohibit merely prevents Plaintiffs from conducting any new

“operation” until reforestation is complete and all penalties are paid. The OFPA defines an

“operation” as any “commercial activity relating to the establishment, management, or harvest of

forest tree species.” 44 ORS § 527.620(12). Thus, the text of the Order requires only that

Plaintiffs replant the felled trees and pay a fine before engaging in another commercial timber

harvest.

Moreover, the Order to Prohibit does not preclude mining. Plaintiffs are free to mine their

property in any manner they choose, so long as they comply with all relevant state regulations,

including the OFPA and the Order to Prohibit. See Bohmker, 903 F.3d at 1045-51 (holding that a

state ban on suction dredge mining was not federally preempted because it did not ban all

mining). As alleged in the complaint, Plaintiffs violated the OFPA when they sold the timber

they removed from the planned mining area. Plaintiffs were ordered to pay a fine and reforest the

area, and they were unable to enact their original mining plan. However, though Plaintiffs are no

longer able to mine in the manner they originally intended, they are not banned from mining

altogether. For instance, assuming no other regulations or orders would be violated, Plaintiffs

could pan for gold in the river or shaft mine. Mining is not prohibited; rather, mining in a manner

that fails to comply with Oregon’s regulatory system is prohibited. Since Plaintiffs may still

mine their land, the OFPA, as applied through the Order to Prohibit, does not conflict with the

Mining Act. Therefore, Plaintiffs have failed to state a cognizable preemption claim.

IL. Plaintiffs’ remaining claims are dismissed for failure to state a cognizable

claim for relief.

a. Plaintiffs’ substantive due process claim for recognition of a new

“fundamental property right” is not cognizable.

Plaintiffs have requested this Court to create a new “fundamental property right,”

protected by the Fourteenth Amendment’s Due Process Clause. This Court declines to do so.

Under the Supreme Court’s substantive due process precedent, to be considered a fundamental

right, an asserted right must be “deeply rooted in this Nation’s history and tradition” and

“{mplicit in the concept of ordered liberty.” Washington v. Glucksberg, 521 U.S. 702, 721

(1997). Furthermore, the Supreme Court has required a “careful description of the asserted

right.” Reno v. Flores 507 U.S. 292, 302 (1993).

Plaintiffs describe their asserted right as “the fundamental freedom of persons to the

private enjoyment and use of their property.” Second Am. Compl. § 123 (#26). They allege “that

government regulation of such property must be narrowly tailored to achieve a compelling

governmental interest.” Jd. Never in the history of Fourteenth Amendment jurisprudence or

Ninth Circuit precedent has such a “fundamental property right” been recognized. Furthermore,

Plaintiffs’ description of the asserted right is vague, broad, and far from “careful.” Even if this

Court were inclined to vastly expand the scope of substantive due process, the asserted right, as

alleged in Plaintiffs’ complaint, cannot pass the Supreme Court’s test. Therefore, Plaintiffs have

failed to state a cognizable claim for a new “fundamental property right.”

19) MBNA. 8B ADNRATD

b. Plaintiffs’ void for vagueness claim is not a cognizable constitutional

challenge to the OFPA.

Plaintiffs’ “void for vagueness” claim is not cognizable because Plaintiffs cannot

demonstrate that the statute as applied is unconstitutionally vague. The void for vagueness

doctrine “guarantees that ordinary people have ‘fair notice’ of the conduct a statute proscribes.”

Sessions v. Dimaya, 138 S.Ct. 1204, 1212 (2018) (quoting Papachristou v. Jacksonville, 405

U.S. 156, 162 (1972). “An enactment is void for vagueness if its prohibitions are not clearly

defined.” Grayned y. City of Rockford, 408 U.S. 104, 108 (1972). Additionally, the Supreme

Court has stated that “[o]ne to whose conduct a statute clearly applies may not successfully

challenge it for vagueness.” Parker y, Levy, 417 U.S. 733, 756 (1974).

Even as alleged in the complaint, the conduct for which Plaintiffs were originally cited—

commercial timber harvesting in an area designated as “forestland”-——was clearly proscribed by

the OFPA. Moreover, the fact that the Brimstone Property was protected under the OFPA was

established in a final administrative proceeding and cannot now be denied. Because a binding

state agency proceeding conclusively established that the OFPA applies to Plaintiffs’ conduct,

Plaintiffs cannot successfully challenge the OFPA for vagueness.

Additionally, Plaintiffs are not required to apply for a PFAP; they are allowed to do so.

OAR 629-610-0090(3). Since the OFPA does not mandate a PFAP, Plaintiffs do not face any

civil or criminal penalties as a result of their failure to obtain one. The PFAP requirements thus

do not amount to any “prohibition” that can be challenged under the void for vagueness doctrine.

In other words, the permissive statutory scheme that allows individuals to apply for a PFAP

cannot be void for vagueness. Therefore, Plaintiffs’ void for vagueness claim is not a cognizable

constitutional challenge to the OFPA.

DotA ORnTTAT EB ADNTD

c. Plaintiffs’ Contracts Clause claim is not cognizable.

Plaintiffs have failed to state a legally cognizable claim under Article | § 10 of the

Constitution, which limits the power of states to pass laws “impairing the Obligation of

Contracts.” As a prerequisite for a successful claim under the Contracts Clause, a plaintiff must

show more than the general existence of a contractual relationship between parties; rather, he

must show the parties entered a contractual agreement regarding the specific impairment being

alleged. RUI One Corp. v. City of Berkeley, 371 F.3d 1137, 1147 (9th Cir. 2004).

Here, Plaintiffs allege the Department of Forestry has “prevent[ed] Plaintiffs from

mining” with an Order to Prohibit and a “sham change of use process.” Second Am. Compl. J

137 (#26). However, Plaintiffs allege no facts supporting the existence of a contractual

agreement to mine on the land. Instead, they allege only that the property at issue originates

under a federal land patent. J@ □□ 33-34. Furthermore, the impairment alleged by Plaintiffs was

previously adjudicated in state administrative hearings, which determined that the OFPA did not

expressly prohibit Plaintiffs from mining, only from conducting the operation as they envisioned

it. Because Plaintiffs have not alleged sufficient facts to support a cognizable claim of

contractual impairment, this claim is dismissed.

d. Plaintiffs fai] to state a procedural due process claim.

Plaintiffs’ procedural due process claim alleges that Defendants created a “sham” PFAP

application process that deprived Plaintiffs of their mining rights without notice or opportunity to

be heard. To establish a procedural due process violation, a plaintiff must demonstrate the

deprivation of a protected liberty or property interest without adequate procedural safeguards.

Morrissey v. Brewer, 408 U.S. 471, 481 (1972). Determining what constitutes “adequate

procedural safeguards” requires consideration of the following factors: “First, the private interest

□□□ a.Tt BANG

that will be affected by the official action: second, the risk of an erroneous deprivation of such

interest through the procedures used, and the probable value, if any, of additional or substitute

procedural safeguards; and finally, the Government's interest, including the function involved

and the fiscal and administrative burdens that the additional or substitute procedural requirement

would entail.” Matthews y. Eldridge, 424 U.S. 319, 335 (1976).

Plaintiffs’ claim, as alleged, fails because the procedural safeguards afforded to Plaintiffs

were adequate according to the Matthews test. First, the “private interest” allegedly being

affected is Plaintiffs’ mining rights. As discussed above, the facts as alleged do not show that the

Plaintiffs are being deprived of their mining rights because they still have the ability to mine

their property. Second, even if the Plaintiffs were being deprived of their mining rights, the risk

of an “erroneous deprivation” of this interest is low. As alleged, Plaintiffs received

administrative hearings as requested and an appeals process was available to contest the

administrative rulings. Second Am. Compl. 4 71 (#26). Additionally, because Plaintiffs

abandoned their appeal of the 2013 Repair Order and the Order to Prohibit, there would be

minimal value, if any, to having “additional” safeguards. Second Am. Compl. 4 71 (#26).

Finally, the government has a strong interest in ensuring that forestland under its control is

maintained according to lawful environmental regulation and would be burdened by the fiscal

cost of providing additional safeguards. Thus, the procedural safeguards were adequate, and

Plaintiffs failed to state a cognizable procedural due process claim.

e. Plaintiffs fail to state a cognizable equal protection claim.

Plaintiffs’ also allege that Defendants singled them out for intentional and arbitrary

discrimination in violation the Equal Protection Clause of the Fifth and Fourteenth Amendments.

“(T]he first step in equal protection analysis is to identify the state's classification of groups.” □

Doar AOKRTD

Country Classic Dairies, Inc. v. Milk Control Bureau, 847 F.2d 593, 596 (9th Cir. 1988). “[T]he

groups must be comprised of similarly situated persons so that the factor motivating the alleged

discrimination can be identified.” Thornton v. City of St. Helens, 425 F.3d 1158, 1167 (9th Cir.

2005). An equal protection claim can also lie where a plaintiff can establish that he is a “class of

one” in that he has been intentionally treated differently than others similarly situated, and there

is no rational basis for the difference in treatment. Hood Canal Sand and Gravel, LLC v. Brady,

129 F.Supp.3d 1118, 1125 (9th Cir. 2015).

In this case, Plaintiffs have not alleged any action taken against them based on their

membership in any class or group. Additionally, Plaintiffs have not sufficiently alleged that they

have been treated differently than others similarly situated, i.e. others who attempted to change

the use of a property from forestland to mining. It is unclear to this Court if there has ever been a

PFAP granted for a change of use from forestland to mining. ODF staff have “never seen an

alternate practice plan requested for mining.” Ex. 102 at 37 (#30). Therefore, as alleged,

Plaintiffs failed to state a cognizable equal protection claim.

f. Plaintiffs fail to state a cognizable takings claim.

Finally, Plaintiffs allege that Defendants’ actions constitute a physical taking of their

property and seek just compensation under the Takings Clause of the Fifth Amendment, as

applied through the Fourteenth Amendment. Second Am. Compl. ff] 150-153 (#26). To state a

claim for a physical taking requiring just compensation, a plaintiff must make a threshold

allegation that the government “[required] the landowner to submit to the physical occupation of

his land,” Yee v. City of Escondido, Cal., 503 U.S. 519 (1992). A plaintiff cannot establish a

physical takings claim simply by alleging he has been “denied the ability to exploit a property

17 £339€IDTAITCVAT MDMNOD

interest that [he] heretofore had believed was available for development... .” Penn Central

Transp. Co. v. City of New York, 438 U.S. 105, 130 (1978).

In this case, Plaintiffs have failed to state a legally cognizable claim for the physical

taking of their property. They allege no facts showing Defendants required the physical

occupation of their land. Moreover, their allegations that Defendants’ actions “prevent Plaintiffs’

intended legal use” and “frustrated Plaintiffs” expectations in purchasing the properties” are □

insufficient to support a physical takings claim. Second Am. Compl. ff 151-152 (#26). Because

Plaintiffs have not stated a cognizable takings claim, this claim is dismissed.

CONCLUSION

For the foregoing reasons, Plaintiffs have failed to state a claim upon which relief can be

granted. The Court cannot say with absolute certainty that amendment of these claims would be

futile. However, the deficiencies are significant, especially considering Plaintiffs’ failure to

exhaust administrative remedies. In an abundance of caution, the Court dismisses Plaintiffs’

Complaint (#26) without prejudice. Regarding the recently filed Motion for Extension of Time

(#47), Plaintiffs have not shown good cause for this Court to delay ruling on Defendant’s Motion

to Dismiss (#29). Pursuant to Federal Rule Civil Procedure 15, Plaintiffs may address any new

events or allegations in an amended complaint if one is filed. __

ORDER

For the reasons stated above, the Defendants’ Motion to Dismiss (#29) is GRANTED.

This case is dismissed without prejudice, with leave to amend within 30 days. Defendants’

unopposed Motion for Judicial Notice (#30) is also GRANTED. Plaintiffs’ Motion for Extension

of Time (#47) is DENIED.

IT ISSO ORDERED.

D216 TTA.T 8 ADNTD

DATED this 7 on ugust, 2019.

D. CL

United States Magistrate Judge