Banks v. United States

United States Court of Appeals

for the Federal Circuit

______________________

JOHN H. BANKS, ET AL.,

Plaintiffs-Appellants,

v.

UNITED STATES,

Defendant-Appellee.

______________________

2012-5067

______________________

Appeal from the United States Court of Federal

Claims in consolidated Nos. 99-CV-4451, 99-CV-4452, 99-

CV-4453, 99-CV-4454, 99-CV-4455, 99-CV-4456, 99-CV-

4457, 99-CV-4458, 99-CV-4459, 99-CV-44510, 99-

CV44511, 99-CV-44512, 00-CV-365, 00-CV-379, 00-CV-

380, 00-CV-381, 00-CV-382, 00-CV-383, 00-CV-384, 00-

CV-385, 00-CV-386, 00-CV-387, 00-CV-388, 00-CV-389,

00-CV-390, 00-CV-391, 00-CV-392, 00-CV-393, 00-CV-394,

00-CV-395, 00-CV-396, 00-CV-398, 00-CV-399, 00-CV-400,

00-CV-401, 05-CV-1353, 05-CV-1381, and 06-CV-072,

Chief Judge Emily C. Hewitt.

______________________

Decided: January 28, 2014

______________________

EUGENE J. FRETT, Sperling & Slater, P.C., of Chicago,

Illinois, argued for plaintiffs-appellants. Of counsel on

the brief were MARK E. CHRISTENSEN, Christensen &

BANKS v. US 2

Ehret, LLP, of Chicago, Illinois, and JOHN EHRET, of

Olympia Fields, Illinois.

ELIZABETH ANN PETERSON, Attorney, Environment &

Natural Resources Division, United States Department of

Justice, of Washington, DC, argued for defendant-

appellee. With her on the brief was IGNACIA S. MORENO,

Assistant Attorney General.

BRIAN T. HODGES, Pacific Legal Foundation, of

Bellevue, Washington, and R.S. RADFORD, of Sacramento,

California, for amicus curiae Pacific Legal Foundation.

______________________

Before RADER, Chief Judge, LINN, and WALLACH, Circuit

Judges.

WALLACH, Circuit Judge.

These consolidated individual actions were brought by

thirty-seven lakefront property owners seeking just

compensation under the Fifth Amendment of the United

States Constitution for a partial physical taking of their

respective properties by the United States Army Corps of

Engineers (“Corps”). The United States Court of Federal

Claims dismissed the actions as time-barred. Because the

Court of Federal Claims violated this court’s mandate in

Banks v. United States (Banks II), 314 F.3d 1304, 1310

(Fed. Cir. 2003), and clearly erred in finding that

Appellants knew or should have known of their claims

before 1952, the Court of Federal Claims’ dismissal is

reversed.

BACKGROUND

I. The St. Joseph Harbor Jetties

Beginning in the 1830s, the Corps began constructing

two major harbor jetties on Lake Michigan near the St.

Joseph River. These jetties protrude outward from the

BANKS v. US 3

mouth of the river into the body of the lake. They were

periodically extended until 1903, when they reached their

current length. After 1903, major construction on the

jetties ceased until 1950, when the Corps began a project

to encase the jetties in steel-sheet piling. This project was

completed in 1989.

Appellants (also referred to as “Plaintiffs”) are

landowners along approximately four and one-half miles

of the eastern shore of Lake Michigan, south of the jetties.

This shoreline is eroding naturally, but Appellants allege

the jetties block the flow of sand and sediment from the

river and the lakeshore north of their properties.

Specifically, they argue that the structures interrupt the

natural littoral drift within the lake, leading to increased

erosion on their properties, amounting to an unlawful

taking under the Fifth Amendment.

The Corps has also been concerned with erosion along

the Lake Michigan shoreline. In 1958, the Corps released

a “Beach Erosion Control Study” (the “1958 Study”) that

examined the effects of beach erosion on Berrien County,

Michigan, where the St. Joseph jetties are located. This

Report documented increased erosion in certain areas as a

result of the jetties and recommended that a nourishment

program “be initiated at the earliest practicable date.”

J.A. 5939. This program did not target Appellants’ land

because the land was then private and ineligible for

federal funding. Nonetheless, the project was expected to

benefit them by “restoration of normal littoral drift” in the

area. J.A. 5959.

In 1968, Congress enacted the “Rivers and Harbors

Act,” which authorized the Secretary of the Army to

“investigate, study, and construct projects for the

prevention or mitigation of shore damages attributable to

Federal navigation works.” River and Harbor Act of 1968,

Pub. L. No. 90-483, § 111, 82 Stat. 731, 735 (1968)

(codified as amended at 33 U.S.C. § 426i (2012)).

BANKS v. US 4

Pursuant to this authority, the Corps proposed a plan to

mitigate the erosion caused by the jetties by dumping

sand into feeder beaches located to the north of

Appellants’ properties. This endeavor was projected to

“provide the quantities of littoral material interrupted by

the [jetties] to the shores downdrift.” J.A. 5061.

Implemented in 1976, the mitigation plan “involved

placing fine sand from the harbor maintenance dredging

on the downdrift [southerly] beaches.” Banks v. United

States (Banks I), 49 Fed. Cl. 806, 818 (2001), rev’d, 314

F.3d 1304 (Fed. Cir. 2003) (internal quotation marks and

citation omitted). After fifteen years of beach

nourishment, the mitigation efforts shifted to using

coarser sediment, in the hope it would have a longer

retention time than fine sand. Eventually, in 1995, the

Corps dumped “barge-loads of large rocks into the lake.”

Id. at 819.

In relation to these projects, the Corps released a

series of reports in 1973, 1996, 1997, and 1999 on the

erosive effects of the jetties and the progress of mitigation

efforts. There is also an April 20, 1998, newspaper article

relating to the erosion.

The 1973 Report “has been described, without

contradiction, ‘as the first credible look at the St. Joseph

Harbor structures in estimating the total amount of

material trapped in the structures.’” Banks v. United

States, 78 Fed. Cl. 603, 612 (2007) (“Liability Op.”). The

Corps started implementing mitigation programs after

this Report.

The 1996 Report concluded that the St. Joseph

shoreline was “in a state of recession” and that the erosion

that occurs during lakebed downcutting 1 is “permanent.”

1 Downcutting is explained as follows: “If the sand

cover to glacial till is depleted, the energy of the waves

and the shifting of the sand, which acts as ‘sandpaper,’

BANKS v. US 5

Larry E. Pearson, Andrew Morang & Robert B. Nairn,

U.S. Army Corps of Engineers, Geologic Effects on

Behavior of Beachfill and Shoreline Stability for

Southeast Lake Michigan 9, 48 (1996) (“1996 Report”).

However, the Report also indicated uncertainty regarding

the effects of mitigation efforts: the mitigation program

“may provide at least partial protection to the underlying

glacial till along and offshore of the feeder beach and the

waterworks revetment section of shore. It is unclear

whether the beach nourishment is having any negative or

positive impact along the 3.5-km revetment section of

shoreline south of the waterworks.” Id. at 49; see also

Banks II, 314 F.3d at 1307.

The 1997 Report observed that some areas were

benefitting from nourishment but in other areas the

results were “questionable.” J.A. 5516. The 1999

Report—made public in 2000—identified Lake Michigan

as a cohesive, rather than sandy, shoreline, and stated

that “‘[e]rosion of the consolidated layer [underlayer of a

cohesive coastline] is generally irreversible.’” 2 Banks I, 49

can cause the lake bottom to erode and thus lower in a

process referred to as ‘downcutting.’” Liability Op., 78

Fed. Cl. at 622.

2 “The composition of the lakebed is relevant because

the composition affects erosion and mitigation processes.”

Liability Op., 78 Fed. Cl. at 622. A sandy lakebed is made

up of materials that are loosely deposited, or easily

dispersed. Id. at 621. Thus, according to the

Government’s expert, “as long as the sand supply south of

the harbor is restored to the pre-harbor levels, then we

can assume directly that the erosion will remain the same

as pre-harbor levels, all other things aside.” Id. (internal

quotation marks and citation omitted). Conversely, in a

cohesive lakebed, the materials are bound together and

are not “freely mobile.” Id. (internal quotation marks and

citation omitted). Cohesive shores are thus “more

BANKS v. US 6

Fed. Cl. at 823 (quoting J.A. 5637). The 1999 Report also

found that the effects of the nourishment programs were

limited because the programs were based on the

assumption that the coastline was sandy, with an

unlimited sand supply, and not cohesive. Appellants

relied on the 1999 Report in arguing their claims were not

time-barred and stated that “the language in this [R]eport

is the first clear indication of permanent damage caused

by the harbor structures.” Id. (internal quotation marks

and citation omitted).

II. Procedural History

This case began in 1999, when a majority of

Appellants filed suit in the Court of Federal Claims

against the Government claiming an unconstitutional

taking under the Fifth Amendment. 3 See 28 U.S.C.

§ 1491 (1994). In 2001, the Government filed a Motion to

Dismiss the Complaint as being time-barred. There was

already a “well-developed” evidentiary record before the

complicated” because the “sand acts to abrade, sort of like

sandpaper, the till.” Id. at 622 (internal quotation marks

and citation omitted). However, “[t]here’s no scientific

knowledge as to . . . when you increase your erosion and

when you may decrease your erosion.” Id. In any event,

“what’s critical about till downcutting is . . . [o]nce it

erodes, it does not recover.” Id. Stated simply, if a

shoreline is sandy, mitigation will be more successful

than if the shoreline is cohesive.

3 The original July 9, 1999, Complaint was filed on

behalf of a “proposed class” of “approximately 200

landowners who own the shoreline property in the area

extending 53,000 feet south from the St. Joseph Harbor

jetties.” J.A. 4939. The Court of Federal Claims denied

class certification, and the thirty-seven Plaintiffs in this

action filed separate Complaints. Appellants’ counsel

treats the allegations in the Complaints as the same. See

Banks I, 49 Fed. Cl. at 808.

BANKS v. US 7

court because the parties had been preparing for trial.

Banks I, 49 Fed. Cl. at 809 n.4. Appellants also offered

expert testimony from Dr. Guy Meadows, a mechanical

engineering professor at the University of Michigan.

The Court of Federal Claims granted the Motion and

dismissed for lack of subject matter jurisdiction, finding

that the claims had accrued in 1989 and were therefore

barred by the Tucker Act’s six-year statute of limitations.

Id. Appellants appealed, and this court reversed and

remanded in 2003, holding that Appellants’ claims did not

materialize until 2000, when the Corps’ Reports

“collectively indicated that the erosion was permanent

and irreversible.” Banks II, 314 F.3d at 1310.

Specifically, this court held: “We are satisfied that the

[P]laintiffs met their jurisdictional burden before the

Court of Federal Claims.” Id.

On remand, the Court of Federal Claims held

separate trials on liability and damages. On June 4,

2007, the case proceeded to the trial on liability. Liability

Op., 78 Fed. Cl. 603. The primary issues addressed were:

(1) the zone of influence of the jetties and whether

Appellants’ properties were located within that zone; (2)

whether the composition of the lakebed adjacent to the

property was sandy or cohesive; and (3) the effectiveness

of the beach nourishment mitigation program. Id. at 613–

14. The Court of Federal Claims concluded that, contrary

to the allegations in Appellants’ Complaints, the jetties

were impermeable to sand before they were encased in

steel. See id. at 636. The court also found that the

United States was liable for 30% of erosion between 1950

and 1970, after each owner’s acquisition of his or her

property. It held that, after 1970, the United States was

responsible for 30% of any losses to erosion that had not

been effectively mitigated. Id. at 656. In so concluding,

the Court of Federal Claims “heard testimony from 22

witnesses and received some 75 exhibits into evidence.”

Id. at 608.

BANKS v. US 8

Following the Liability Opinion, Appellants made

additional motions, including a Motion in Limine based

on the law-of-the-case doctrine to preclude (1) all evidence

that the erosion suffered by Appellants was not

permanent and irreversible; and (2) evidence relating to

the composition of the nearshore lakebed adjacent to

Appellants’ properties. J.A. 1859. The Court of Federal

Claims denied the Motion as to both requests. Appellants

also moved to clarify the measure of damages. The court

granted the motion to clarify and modified its ruling,

finding “that property owners at the time of the taking

are entitled to compensation for ‘all damages, past,

present, and prospective.’” J.A. 1755 (internal citation

omitted). The court then held a trial on damages from

April 18–21, 2011, and from April 25–28, 2011. Banks v.

United States (Banks III), 102 Fed. Cl. 115, 120 (2011).

After the Court of Federal Claims conducted the

damages trial, it found there was “a jurisdictional issue

that arose in connection with its drafting of the trial

opinion.” Banks v. United States, 99 Fed. Cl. 622, 623

(2011) (opinion requesting additional briefing). The court

then directed the parties to file additional briefing

addressing whether the Court of Federal Claims had

jurisdiction to hear Appellants’ claims. Id. at 626.

Specifically, the court asked the parties to brief the

following two questions:

1) Given the court’s finding after the trial of

liability that the jetties were impermeable to sand

before they were encased in steel sheet piling, and

given the Corps’ acknowledgement of the

erosional impact of “harbor structures” in the

1958 Study, on what date did [P]laintiffs’ claims

accrue? Does the court possess subject matter

jurisdiction to hear [P]laintiffs’ claims?

2) Does the Federal Circuit’s determination that

[P]laintiffs’ claims accrued with the publication of

three Corps [R]eports on mitigation constitute the

BANKS v. US 9

“law of the case” which may not be disturbed by

the court notwithstanding inconsistent factual

findings of the court after trial?

Id.

Following the supplemental briefing, on December 22,

2011, the Court of Federal Claims again found it lacked

jurisdiction. The court additionally presented findings “in

the alternative” on the merits of the case, stating if “any

appeal should disagree with the court’s view of its

jurisdiction, and to avoid the possibility . . . of a repetitive

trial, the court also presents here its findings from the

trial.” Banks III, 102 Fed. Cl. at 120. 4

Appellants timely appealed. This court has

jurisdiction pursuant to 28 U.S.C. § 1295(a)(3) (2012).

DISCUSSION

The principal issues on appeal are (1) whether this

court’s opinion in Banks II precluded the Court of Federal

Claims from reconsidering when Appellants’ claims

accrued for the purposes of subject matter jurisdiction,

and (2) whether Appellants knew or should have known

that their claims accrued by 1952.

Specifically, the Court of Federal Claims held:

4

Since 1970, the Corps’ mitigation efforts have

prevented the jetties from causing erosion to

[P]laintiffs’ properties, with one exception.

Further, [P]laintiffs have failed to prove, with

regard to any of [P]laintiffs’ properties—whether

by comparing the cost of shore protection to the

dollar amount of their reasonably foreseeable

damages or by some other means—that the

installation of shore protection would be sound

economy.

Banks III, 102 Fed. Cl. 115.

BANKS v. US 10

I. Standard of Review

This court reviews legal holdings de novo and

examines factual findings for clear error. Bell BCI Co. v.

United States, 570 F.3d 1337, 1340 (Fed. Cir. 2009).

“[T]he interpretation by an appellate court of its own

mandate is properly considered a question of law,

reviewable de novo.” Laitram Corp. v. NEC Corp., 115

F.3d 947, 950 (Fed. Cir. 1997). A dismissal for lack of

jurisdiction by the court below is also a legal conclusion

reviewed de novo. Tex. Peanut Farmers v. United States,

409 F.3d 1370, 1372 (Fed. Cir. 2005).

II. Subject Matter Jurisdiction

The Tucker Act allows plaintiffs to sue the United

States for claims founded upon the Constitution, Acts of

Congress, agency regulations, contracts with the United

States, “or for liquidated or unliquidated damages in

cases not sounding in tort.” 28 U.S.C. § 1491. Title 28

U.S.C. § 2501 limits this allowance to a period of six

years. The six-year limitation operates as a suspension of

sovereign immunity, because without explicit

Congressional authorization, the United States may not

be sued. United States v. Mitchell, 463 U.S. 206, 212

(1983) (“It is axiomatic that the United States may not be

sued without its consent and that the existence of consent

is a prerequisite for jurisdiction.”); United States v.

Sherwood, 312 U.S. 584, 586 (1941). Thus, the statute’s

six-year time frame is a limited jurisdictional window in

which plaintiffs have the ability to bring a claim against

the Government. 28 U.S.C. §§ 1491, 2501.

III. The Mandate Rule

The law-of-the-case doctrine “posits that when a court

decides upon a rule of law, that decision should continue

to govern the same issues in subsequent stages in the

same case.” Christianson v. Colt Indus. Operating Corp.,

486 U.S. 800, 815–816 (1988) (internal quotation marks

BANKS v. US 11

and citation omitted). The rule encourages both finality

and efficiency in the judicial process by preventing

relitigation of already-settled issues. Id. at 816. The

mandate rule, encompassed by the broader law-of-the-

case doctrine, dictates that “an inferior court has no

power or authority to deviate from the mandate issued by

an appellate court.” Briggs v. Pa. R. Co., 334 U.S. 304,

306 (1948); see also Cent. Soya Co. v. Geo. A. Hormel &

Co., 723 F.2d 1573, 1580 (Fed. Cir. 1983) (explaining that

the law-of-the-case doctrine was “judicially created to

ensure judicial efficiency and to prevent the possibility of

endless litigation”). Once a question has been considered

and decided by an appellate court, the issue may not be

reconsidered at any subsequent stage of the litigation,

save on appeal. Cf. In re Sanford Fork & Tool Co., 160

U.S. 247, 255 (1895) (“Whatever was before [the Supreme

Court], and disposed of by its decree, is considered as

finally settled. . . . If the circuit court mistakes or

misconstrues the decree of this court, and does not give

full effect to the mandate, its action may be controlled . . .

upon a new appeal.”).

Under the mandate rule, a court below must adhere to

a matter decided in a prior appeal unless one of three

“exceptional circumstances” exist: (1) subsequent evidence

presented at trial was substantially different from the

original evidence; (2) controlling authority has since made

a contrary and applicable decision of the law; or (3) the

decision was clearly erroneous “and would work a

manifest injustice.” Gindes v. United States, 740 F.2d

947, 950 (Fed. Cir. 1984) (internal quotation marks and

citation omitted). This rule is limited to issues “actually

decided, either explicitly or by necessary implication” in

the previous litigation. Toro Co. v. White Consol. Indus.,

Inc., 383 F.3d 1326, 1335 (Fed. Cir. 2004).

Appellants’ first jurisdictional argument is that the

Court of Federal Claims violated this court’s mandate and

that none of the three exceptions gave it the power to do

BANKS v. US 12

so. The Government counters that the Court of Federal

Claims “correctly concluded that the issue here—whether

Banks knew or should have known of the claims before

the refurbishment and mitigation projects were

undertaken in the 1950s and 1970s—was not considered

or decided by this Court in Banks II.” Appellee’s Br. 30.

To determine whether this court’s mandate in

Banks II was violated, its scope must first be established.

The Banks II court prefaced the analysis by stating its

focus: “The issue before this court on appeal is whether

the Court of Federal Claims erred in finding that the

[P]laintiffs’ claims fell outside the applicable statute of

limitations.” Banks II, 314 F.3d at 1308. After applying

the analogous case of Applegate v. United States, 25 F.3d

1579 (Fed. Cir. 1994), the court held that:

We are satisfied that the [P]laintiffs met their

jurisdictional burden before the Court of Federal

Claims on the basis of the justifiable uncertainty

of the permanence of the taking caused by the

actual mitigation efforts of the Corps. The statute

of limitations did not begin to run until the Corps

issued the 1996, 1997, and 1999 Reports. Because

each [R]eport was issued less than six years

before [P]laintiffs filed their [C]omplaints, each

[C]omplaint was timely.

Banks II, 314 F.3d at 1310 (citation omitted).

On remand, the Court of Federal Claims again

dismissed the case, finding Appellants’ Complaints were

untimely. It held its dismissal was not barred by the

mandate rule, on the ground that this court’s decision did

not address “whether [P]laintiffs’ claims accrued before

the [G]overnment made its first promises of mitigation.”

Banks III, 102 Fed. Cl. at 150. Finding that “the jetties

were impermeable to sand before they were encased in

steel sheet piling,” id. at 131, the Court of Federal Claims

held the Appellants’ claims accrued before 1952 and

BANKS v. US 13

dismissed the case for want of jurisdiction. The Court of

Federal Claims found that for Appellants’ claims to have

been timely filed, the erosion must have stabilized after

1952, six years before the 1958 Study, which Appellants

argued created justifiable uncertainty about the

permanence of the taking. Id. at 133–34.

The Government argues that Banks II never decided

whether the claims accrued before 1952, because both this

court and the Court of Federal Claims “accepted as true

the allegations of the Complaints, including the allegation

that the jetties caused no damage before 1950.”

Appellee’s Br. 31–32. The Government therefore contends

that the Court of Federal Claims did not violate the

mandate rule when it considered that issue on remand.

The problem with the Government’s position is that

neither the Court of Federal Claims nor this court

accepted as true all the allegations in Appellants’

Complaint. When reviewing a motion to dismiss for lack

of subject matter jurisdiction, a court accepts only

uncontroverted factual allegations as true for purposes of

the motion. Gibbs v. Buck, 307 U.S. 66, 72 (1939). “If a

motion to dismiss for lack of subject matter jurisdiction,

however, challenges the truth of the jurisdictional facts

alleged in the complaint, the district court may consider

relevant evidence in order to resolve the factual dispute.”

Reynolds v. Army & Air Force Exch. Serv., 846 F.2d 746,

747 (Fed. Cir. 1988); see also Engage Learning v. Salazar,

660 F.3d 1346, 1355 (Fed. Cir. 2011); Cedars-Sinai Med.

Ctr. v. Watkins, 11 F.3d 1573, 1584 (Fed. Cir. 1993). In

such cases, the plaintiff has the burden of proving subject

matter jurisdiction by a preponderance of the evidence.

Reynolds, 846 F.2d at 748 (citing Zunamon v. Brown, 418

F.2d 883, 886 (8th Cir. 1969)). Additionally, “[i]f the Rule

12(b)(1) motion [to dismiss] denies or controverts the

pleader’s allegations of jurisdiction . . . the movant is

deemed to be challenging the factual basis for the court’s

BANKS v. US 14

subject matter jurisdiction.” Cedars-Sinai Med. Ctr., 11

F.3d at 1583.

In Banks I, the Court of Federal Claims stated that

“[b]ecause the parties were preparing for trial at the time

[D]efendant filed its [M]otion to [D]ismiss, the evidentiary

record is well-developed. The court has before it the

anticipated trial exhibits prepared by the parties and filed

in accordance with the pre-trial scheduling order.” Banks

I, 49 Fed. Cl. at 809 n.4. The court then explained that

“Plaintiffs cannot rely merely on the allegations in the

[C]omplaint. Because [P]laintiffs bear the burden of proof

by a preponderance of the evidence, they must offer

relevant, competent evidence to show that they filed suit

within six years of the accrual of their claims.” Id. at 809

(internal citation omitted). Explicitly looking outside of

the Complaint, the court granted the Government’s

Motion to Dismiss, stating: “The court observes that

[P]laintiffs’ claims that they were uncertain about the

permanence of the erosion damage until 1999 are

contradicted by their own evidence.” 5 Id. at 824.

Holding those findings were clearly erroneous and

that Appellants’ claims did not accrue until 2000, the

Banks II court relied on the technical Reports, not solely

on the Appellants’ allegations in the Complaint. It is

simply inaccurate to claim that the factual allegations of

the Complaint were taken as true by either court.

Banks II did not “leave open” the issue of when

Plaintiffs’ claims accrued. The Banks II court held the

Complaints were not barred by the six-year statute of

5 The Banks II court stated that the 1996, 1997, and

1999 Reports were all in evidence before the Court of

Federal Claims. Banks II, 314 F.3d at 1307 (explaining

“[t]he evidence before the Court of Federal Claims

included three technical [R]eports issued by the Corps”).

BANKS v. US 15

limitations. Necessary and predicate to the holding was a

finding that the mitigation efforts delayed claim accrual.

Because the Banks II mandate decided the accrual

date, the Court of Federal Claims was permitted to revisit

this issue only if one of the three exceptions to the

mandate rule applied. The Court of Federal Claims did

not find, and the Government did not argue, that the

Banks II decision was clearly erroneous or that there was

a change in controlling precedent. Thus, only the third

exception—whether subsequent evidence presented at

trial was substantially different from the original

evidence—is relevant.

The Government contends that the “most persuasive

evidence that the jetties had caused erosion of the Banks

properties” was the 1958 Study, which was admitted in

July 2007, six years and four years after Banks I and

Banks II, respectively. Appellee’s Br. 34 (citing Banks III,

102 Fed. Cl. at 134). Appellants respond that “the

evidence is not new, and far from being substantially

different, is merely cumulative of the jurisdictional

evidence that was before this [c]ourt.” Appellants’ Br. 27.

When a party offers additional evidence that is

consistent with previously-offered evidence, but is not

new or different in any real sense, a court should decline

the invitation to revisit its previous determination. See

Intergraph Corp. v. Intel Corp., 253 F.3d 695, 698 (Fed.

Cir. 2001) (noting that the district court stated,

“[a]lthough Intergraph may have obtained more evidence

related to the FTC’s actions, the Federal Circuit was

certainly aware of the actions”); see also United States v.

Bartsh, 69 F.3d 864, 867 (8th Cir. 1995) (finding that the

Appellant presented “no new substantive evidence, but

merely a recalculation of the same evidence that was

offered at the sentencing hearing”). In the instant case,

while the Court of Federal Claims may have examined

the evidence more thoroughly in the bifurcated liability

BANKS v. US 16

and damages trial, all of it was consistent with evidence

that was before both the Court of Federal Claims on the

Government’s Motion to Dismiss and this court on appeal

in 2003.

The evidence before the Court of Federal Claims after

this court’s mandate issued was not “new” but merely

cumulative of evidence before it in 2001. The evidentiary

record before the Court of Federal Claims in 2001

included the 1996, 6 1997, 7 and 1999 8 Reports, a 1998

newspaper article, 9 and evidence from Plaintiffs’ expert,

6 The 1996 Report, in relevant part, states that the

shoreline is in recession and that “[e]vidence has been

presented by Buckler (1981) showing a southward

progression of increased erosion rates since at least 1829.

Further studies by Buckler and Winters (1983) revealed

average bluff recession rates for the area between St.

Joseph and Shoreham of approximately 0.6 m/year

between 1829 and 1977.” J.A. 5031 (emphases added).

7 The 1997 Report makes similar findings: “The

harbor jetties were constructed originally in 1903 and

have been estimated to trap approximately 84,000 [cubic

meters] of sediment per year.” J.A. 5434.

8 The 1999 Report similarly states “the removal of

sand from the littoral transport system has been

occurring from the time of construction; in some cases for

over one hundred years.” J.A. 5637 (emphasis added).

9 In the record, and cited by the Court of Federal

Claims in 2001, was also a 1998 newspaper article from

the Herald-Palladium, titled “Too soon to tell if erosion

experiment will help.” The article, quoting a physical

scientist for the Corps, Charles Thompson, stated: “the

project began only in the early 1970’s so basically we have

80, 90, or 100 years of non-mitigation to make up for. . . .

For most of the life of the St. Joseph’s Harbor structures

[jetties], little was done to mitigate the effects of those

BANKS v. US 17

Dr. Meadows, 10 all of which contained information similar

to that in the 1958 Study.

The sum of that evidence is that erosion has been

occurring since at least 1903. The evidence was not only

before the Court of Federal Claims in Banks I; the court

referred to, and relied upon, it extensively. The same

evidence was before this court in 2003, as evidenced by

the fact that the basis for this court’s opinion in Banks II

was the 1996, 1997, and 1999 Reports. This court is not

persuaded that any “new” evidence required reexamining

jurisdiction that had already been decided by this court.

In evaluating the scope of the mandate, the actions of

the Court of Federal Claims must not be inconsistent with

the letter or spirit of the mandate. Engel Indus. Inc. v.

Lockformer Co., 166 F.3d 1379, 1383 (Fed. Cir. 1999).

Indeed, “all issues within the scope of the appealed

judgment are deemed incorporated within the mandate

and thus are precluded from further adjudication.” Id. at

1383. The broad mandate issued by this court found that

Appellants’ claims did not accrue until the 1996, 1997,

and 1999 Reports. This decision necessarily decided that

structures.” Banks I, 49 Fed. Cl. at 821 (internal

quotation marks and citation omitted).

10 The Court of Federal Claims also cited to testimony

from Dr. Meadows that the jetties had been causing

erosion since their completion in 1903. Specifically, Dr.

Meadows testified that:

The harm that has been done is the accumulated

harm since 1903 [(the construction date of the

harbor jetties)]. That structure has done two

things. It has blocked the shore parallel transport

of material from north to south and it has also

deflected some of that material offshore and,

hence, being lost forever once it’s beyond the

depth of closure.

Banks I, 49 Fed. Cl. at 817 (citation omitted).

BANKS v. US 18

the claims did not accrue prior to 1952. The Court of

Federal Claims’ Banks III holding that the claims accrued

before that time is therefore reversed.

IV. Accrual Suspension

The Court of Federal Claims further erred in its

analysis of accrual suspension. The accrual of a claim

against the United States is suspended, for purposes of 28

U.S.C. § 2501, until the claimant knew or should have

known that the claim existed (“the accrual suspension

rule”). Boling v. United States, 220 F.3d 1365, 1373 (Fed.

Cir. 2000) (finding that, when determining when a taking

claim accrues, “the key issue is whether the permanent

nature of the taking was evident such that the landowner

should have known that the land had suffered erosion

damage”); Hopland Band of Pomo Indians v. United

States, 855 F.2d 1573, 1577 (Fed. Cir. 1988); Kinsey v.

United States, 852 F.2d 556, 557 n.* (Fed. Cir. 1988) (“A

claim does not accrue unless the claimant knew or should

have known that the claim existed.”); see also Holmes v.

United States, 657 F.3d 1303, 1322 n.15 (Fed. Cir. 2011).

For the accrual suspension rule to apply, the claimant

“must either show that the defendant has concealed its

acts with the result that plaintiff was unaware of their

existence or it must show that its injury was ‘inherently

unknowable’ at the accrual date.” Young v. United States,

529 F.3d 1380, 1384 (Fed. Cir. 2008) (quoting Martinez v.

United States, 333 F.3d 1295, 1319 (Fed. Cir. 2003) (en

banc)). The inherently unknowable test “includes a

reasonableness component.” Holmes, 657 F.3d at 1320

(“While we have stated that the ‘concealed or inherently

unknowable’ formulation of the test for accrual

suspension is ‘more common and more precise’ than the

‘knew or should have known’ formulation, we do not view

that statement as eschewing the reasonableness

component of the ‘inherently unknowable’ prong of the

test.”) (internal citation omitted).

BANKS v. US 19

The Court of Federal Claims found that Appellants’

argument relating to accrual suspension based on the

overruling of adverse precedent was waived because they

did not raise it in their opening brief to that court. In the

alternative, the court held that the accrual suspension

rule was “inapplicable to [P]laintiffs’ claims.” Banks III,

102 Fed. Cl. at 144. On appeal, Appellants argue that

accrual suspension should apply because they “should not

reasonably have been expected to know that jetty-caused

erosion was significantly damaging their properties until

1997.” Appellants’ Br. 23. The Government contends

that Appellants “now raise[ ] a second accrual suspension

argument that was not raised in the [Court of Federal

Claims]” and that argument is waived. Appellee’s Br. 40.

Appellants have not waived their accrual suspension

arguments. The Court of Federal Claims cited

Appellants’ argument “that as late as 1997 it was not

understood that the harbor jetties caused increased

erosion in [P]laintiffs’ zone. The implication of

[P]laintiffs’ argument is that their claims stabilized no

earlier than 1997 because it was not understood at that

time that the jetties were causing erosion in [P]laintiffs’

zone.” Banks III, 102 Fed. Cl. at 141. Though Banks did

not use the term “accrual suspension” in making this

argument, the substance is the same as that which it

argues before this court. Accordingly, the argument is not

waived.

The Court of Federal Claims held that “erosion caused

by the jetties in [P]laintiffs’ zone was a longstanding

problem by 1952, beginning as early as 1903,” id. at 138,

and that the forty-nine-year passage of time and “well-

documented” erosion would have made it “clear to a

reasonable landowner . . . that the [G]overnment had

effected a permanent taking,” 11 id. at 140. Appellants

11The Court of Federal Claims found that “[d]uring

the forty-nine years between 1903, when the jetties

BANKS v. US 20

argue that they could not have known they had a takings

claim until 1997, when the 1997 Report issued. The

Government counters that Appellants’ claims were not

“inherently unknowable” and that they should have

known about the erosion as early as 1950.

When there is a gradual physical process, such as

erosion or flooding, the “stabilization doctrine” delays

claim accrual until the situation has “stabilized.” See

United States v. Dickinson, 331 U.S. 745, 749 (1947).

Thus, the statute of limitations under the Tucker Act only

begins to run when it “becomes clear that the gradual

process set into motion by the [G]overnment has effected

a permanent taking, not when the process has ceased or

when the entire extent of the damage is determined.”

Boling, 220 F.3d at 1370–71.

In making the determination of permanence, a court

considers “the uncertainties of the terrain, the difficulty

in determining the location of the government’s easement,

and the irregular process of erosion.” Id. at 1373. Claims

are deemed to accrue once the damage has “substantially

encroached the parcels at issue and the damages were

reasonably foreseeable.” Id.

The Government argues that even if Appellants

inferred from the various Corps Reports that the jetties

had not caused the specific damage to their properties,

“[they] w[ere] on notice of the well-documented connection

between the jetties and erosion along the shore.”

Appellee’s Br. 46. Likewise, the Court of Federal Claims

implies that Appellants knew or should have known that

the jetties were causing erosion because of the “general

reached their final length, and 1952, the jetties were

responsible for 25% of the material eroded from Dr.

Nairn’s study area, the ten mile segment of shoreline

south of the jetties.” Banks III, 102 Fed. Cl. at 140.

BANKS v. US 21

pattern of erosion that followed the lengthening of the

jetties in 1903.” Banks III, 102 Fed. Cl. at 140.

Two factors complicate determining when Appellants

knew or should have known of their alleged takings

claims. First, the shorelines of Appellants’ properties are

subject to natural erosion and other natural fluctuations.

As this court found in Banks II, “without human

intervention, [erosion] occurs naturally at a rate of

approximately one foot per year.” 314 F.3d at 1306.

Furthermore, Lake Michigan is subject to “[s]hort period

fluctuations up to about 1.8 feet, caused by winds and

differences in barometric pressures, [which] occur with

annual frequency.” J.A. 5939. Waves and storms also

affect the shorelines: “Waves from both the northwest and

southwest quadrants cause movement of beach material,

but as evidenced by the much greater accumulation of

beach material north of the St. Joseph Harbor structures,

the predominant direction of littoral transport is

southward.” Id. The Government’s own expert, Dr.

Robert Nairn, a coastal engineer, testified that the slow

process of erosion is “masked by far larger swings in the

width of the beaches next to [P]laintiffs’ properties caused

by cross-shore sand transport, a cyclical process by which

sand is moved offshore during times of high lake levels

and returned to the shore during times of low lake levels.”

Banks III, 102 Fed. Cl. at 121.

That the Plaintiffs were aware of some erosion is not

sufficient for the claim to accrue. See Nw. La. Fish &

Game Pres. Comm’n v. United States, 446 F.3d 1285, 1291

(Fed. Cir. 2006) (explaining because some growth of

hydrilla is normal, the damage to Plaintiffs was not

known until there was uncontrolled overgrowth and the

Corps issued a final refusal to lower the water level).

Indeed, the Corps itself stated that only 30% of the

damage to Appellants’ shorelines was attributable to the

Corps’ activity, meaning 70% of the damage to the subject

properties was attributable to naturally occurring erosion.

BANKS v. US 22

J.A. 5770. Accordingly, it is unreasonable to assume that

a property owner should have been able to discern the

difference between the naturally occurring erosion and

that caused by the jetties.

As found by this court in Banks II, Appellants could

not reasonably have known the damage was “permanent”

until the Corps issued its 1996, 1997, and 1999 Reports

showing that its mitigation efforts could not reverse the

damage caused by its jetties. Banks II, 314 F.3d at 1310.

It is erroneous to hold Plaintiffs responsible for knowledge

that the Government itself had disclaimed prior to the

1997 Report. Cf. L.L.S. Leasing Corp. v. United States,

695 F.2d 1359, 1366 (Fed. Cir. 1982) (by taking upon itself

the obligation to report overtime usage, the Government

relieved the lessor of monitoring such use). The

Government itself explained in the 1958 Study that the

Corps believed that the erosion was not permanent and

could be mitigated and reversed. Banks III, 102 Fed. Cl.

at 133. Moreover, in 1973, the Government believed that

the jetty-induced erosion had not reached the majority of

Appellants’ properties. 12 The Government’s mitigation

efforts thus delayed when Appellants knew or should

have known they had a claim.

Without a basis for imputing knowledge of the effect

of the jetty-caused erosion on Appellants’ properties, it

was unreasonable to find that the Appellants were aware

of their claim regarding the permanency of the taking

before the 1990s Reports.

In light of the foregoing, and because “Dickinson

discouraged a strict application of accrual principles in

unique cases involving Fifth Amendment takings by

continuous physical processes,” Applegate, 25 F.3d at

12 The 1973 Report found that the “area of adverse

influence” of the jetties included properties less than

21,000 feet south of the harbor. J.A. 5776.

BANKS v. US 23

1582 (citing Dickinson, 331 U.S. at 749), the Court of

Federal Claims’ finding that Appellants knew or should

have known of the damage prior to 1952 is clearly

erroneous.

V. The Alternative Merits Discussion is Not a Final,

Appealable Decision

In Banks III, the Court of Federal Claims stated:

For purposes of judicial efficiency, if the reviewing

court in any appeal should disagree with the

court’s view of its jurisdiction, and to avoid the

possibility of a trial opinion being drafted months

or years after the trial, and the possibility of a

repetitive trial, the court also presents here its

findings from the trial. These findings are

presented in the alternative and, in the absence of

jurisdiction, do not entitle [P]laintiffs to just

compensation in the amounts determined by the

court.

102 Fed. Cl. at 120. In the absence of anything

appealable, this court lacks appellate jurisdiction. See 28

U.S.C. § 1295(a)(3). To be final and appealable, see Fed.

R. Civ. P. 54, a decision must end the litigation on the

merits, Catlin v. United States, 324 U.S. 229, 233 (1945),

and the judge must “clearly declare[] h[er] intention in

this respect,” United States v. F. & M. Schaefer Brewing

Co., 356 U.S. 227, 232 (1958). Here, contrarily, the Court

of Federal Claims reasoned that, “[b]ecause [the]

references [to when certain shore protection measures

were undertaken] are scattered across several thousand

pages of trial testimony and documentary evidence,” it

would not decide “which of [P]laintiffs’ shore protection

expenses were incurred between 1950 and 1970, the

period of time during which the government was

responsible for 30% of the erosion” “in the absence of

briefing or a stipulation by the parties.” Banks III, 102

Fed. Cl. at 212. It declined to “undertake to determine

BANKS v. US 24

which of [P]laintiffs’ expenses were incurred after 1970,

the period of time during which the [G]overnment has

completely mitigated the erosion caused by the jetties.”

Id. The Court of Federal Claims added that “[i]f the

reviewing court does not agree with the court’s

determination that it lacks jurisdiction to address

[P]laintiffs’ claims,” it would direct the parties to file

either a stipulation or briefing “to enable the court to

determine which of [P]laintiffs’ shore protection expenses

were incurred prior to 1970 and which were incurred

subsequent to 1970.” Id.

The Court of Federal Claims’ alternative merits

discussion is not a final and appealable decision over

which this court has jurisdiction. On remand, the Court

of Federal Claims may reconsider any merits rulings that

were rendered at a time it mistakenly believed it lacked

jurisdiction. In light of the Court of Federal Claims’

clearly erroneous fact finding on claim accrual, it is

appropriate that there be no law-of-the-case or

comparable obstacle preventing it from reconsidering its

earlier, related findings on the merits. This court’s prior

mandate—that the claims did not accrue until the 1999

Report—is still law-of-the-case, binding below.

CONCLUSION

The Court of Federal Claims’ dismissal for lack of

jurisdiction is reversed and the case is remanded to the

Court of Federal Claims for further proceedings.

REVERSED AND REMANDED