Silver State Land LLC v. United States

In the United States Court of Federal Claims

No. 19-688C

(Filed: May 6, 2020)

********************************************** )

SILVER STATE LAND LLC, ) Breach of land sale contract; Federal

) Land Policy and Management Act;

Plaintiff, ) Bureau of Land Management;

) 43 U.S.C. § 1713; 43 C.F.R. Subparts

v. ) 2710 - 2711; invitation for bids; auction;

) land patent; incorporation by reference;

THE UNITED STATES, ) RCFC 12(b)(6); issue preclusion;

) collateral estoppel; damages election.

Defendant. )

)

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Seth H. Locke, Perkins Coie, LLP, Washington, DC, for plaintiff.

Isaac B. Rosenberg, United States Department of Justice, Civil Division, Washington, DC,

for defendant. With him on the briefs were Joseph H. Hunt, Assistant Attorney General,

Civil Division, Robert E. Kirschman, Jr., Director, and Allison Kidd-Miller, Assistant

Director, Commercial Litigation Branch, Civil Division, United States Department of

Justice, Washington, DC.

OPINION AND ORDER

SOLOMSON, Judge.

As frequently occurs in this Court, we once again are called upon to address an

alleged breach of a government contract “entered into and performed pursuant to a

complex statutory and regulatory scheme[,]” as well as the nature of the relationship

between that scheme and the contract at issue. Alder Terrace, Inc. v. United States, 161

F.3d 1372, 1373 (Fed. Cir. 1998). The complexity of this matter is compounded by prior

Administrative Procedure Act (“APA”) litigation between the Plaintiff, Silver State

Land, LLC (“Silver State”), and the government before the United States District Court

for the District of Columbia, as well as a subsequent appeal from the district court to the

United States Court of Appeals for the District of Columbia Circuit. 1

Before this Court, the central issue is whether the government must pay damages

for its alleged breach of a contract to convey a tract of public land to Silver State. The

government, in its motion to dismiss Silver State’s first amended complaint

(“Complaint”) pursuant to Rule 12(b)(6) of the Rules of the Court of Federal Claims

(“RCFC”), maintains that Silver State’s breach claim is precluded as a matter of law. In

the government’s view, the Bureau of Land Management (“BLM” or the “Agency”) 2

properly declined to transfer the land in question pursuant to statutory provisions that,

according to the government, were incorporated into the parties’ contract. The

government further argues that Silver State’s contract claim is barred under the doctrine

of issue preclusion (also known as collateral estoppel) due to the parties’ prior APA

litigation, which centered on BLM’s alleged statutory and regulatory duty to transfer

the land at issue. The government also moves for dismissal on the grounds that Silver

State seeks damages of a type that it may not recover as a matter of law, even assuming

the government had breached the contract at issue.

The government concedes that it entered into the land sale contract, as Silver

State alleges. Because the Court rejects the government’s interpretation of the contract

at issue and the application of issue preclusion to plaintiff’s claims here, as well as the

government’s damages argument – among other subsidiary and miscellaneous

arguments – the Court DENIES the government’s motion to dismiss Count I of the

Complaint. Because the Court finds that the parties had an express land sale contract,

however, the Court GRANTS the government’s motion to dismiss Count II of the

Complaint, which alleges breach of an implied-in-fact contract.

I. Factual Background 3

This case involves a land sale contract – formed pursuant to a process prescribed

by statute and regulation – that the Agency allegedly breached when it refused to

1Silver State Land, LLC v. Schneider, 145 F. Supp. 3d 113, 117 (D.D.C. 2015) [hereinafter Silver

State I] (citing Administrative Procedure Act, 5 U.S.C. § 706(1), (2)), aff’d, Silver State Land, LLC v.

Schneider, 843 F.3d 982 (D.C. Cir. 2016) [hereinafter Silver State II].

2The BLM is an executive agency within the United States Department of the Interior. See

43 U.S.C. § 1731; Bureau of Land Management, https://www.blm.gov/ (last visited Apr. 28,

2020).

3The facts in this Opinion do not constitute factual findings by the Court. Rather, this Court

assumes, as it must, that the factual allegations contained in Silver State’s Complaint are true for

the purposes of resolving the pending motion to dismiss. See Ashcroft v. Iqbal, 556 U.S. 662, 678

deliver title to Silver State via a land patent, a document formally transferring public

land to a purchaser. 4

Silver State first filed a lawsuit in the United States District Court for the District

of Columbia challenging, pursuant to the APA, the Agency’s “decision not to issue the

patent for the Property.” Silver State I, 145 F. Supp. 3d at 125. After the district court

denied Silver State’s motion for summary judgement and entered judgment for the

Agency, Silver State appealed. The United States Court of Appeals for the District of

Columbia Circuit affirmed the district court’s decision. Silver State II, 843 F.3d at 993.

Silver State then filed its breach of contract claim in this Court.

The following background section first provides an overview of the statutory

and regulatory process that governed the formation of the disputed land sale contract,

(2009) (“[F]or the purposes of a motion to dismiss we must take all of the factual allegations in

the complaint as true.” (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). The Court

also has considered “matters incorporated by reference or integral to the claim, items subject to

judicial notice, [and] matters of public record.” Dimare Fresh, Inc. v. United States, 808 F.3d 1301,

1306 (Fed. Cir. 2015) (quoting 5B Charles Alan Wright & Arthur R. Miller, Federal Practice and

Procedure § 1357 (3d ed. 2004)). RCFC 9(k) provides: “In pleading a claim founded on a contract

or treaty, a party must identify the substantive provisions of the contract or treaty on which the

party relies. In lieu of a description, the party may annex to the complaint a copy of the contract

or treaty, indicating the relevant provisions.” The Court may rely on an annexed copy of the

contract in deciding a motion to dismiss. See, e.g., Terry v. United States, 103 Fed. Cl. 645, 647 n.1

(2012) (relying on “an exhibit appended to defendant's motion containing plaintiff's concession

contract,” which plaintiff referenced in complaint in deciding motion to dismiss).

4 “A ‘patent’ is a grant made by the government that confers on an individual fee simple title to

public lands.” 63C Am. Jur. 2d Public Lands § 48 (2020); see also Bureau of Land Management,

Department of the Interior, Understanding Land Patents, General Land Office Records,

https://glorecords.blm.gov/reference/default.aspx#id=02_About_Our_Documents|01_Patent

s (last visited Apr. 24, 2020) (“Land Patents are Federal Conveyance Documents created on the

initial transfer of land titles from the Federal government to individuals.”); Beard v. Federy, 70

U.S. 478, 491 (1865) (explaining that a land patent “is a deed of the United States” which

operates as “a quit-claim, or rather of a conveyance of such interest as the United States

possessed in the land”); Exxon Chem. Patents, Inc. v. Lubrizol Corp., 935 F.2d 1263, 1267 (Fed. Cir.

1991) (Newman, C.J., concurring) (“a land patent is a grant of real property from the nation”), as

modified, 64 F.3d 1553 (Fed. Cir. 1995); Cavin v. United States, 956 F.2d 1131, 1134 (Fed. Cir. 1992)

(noting that a land patent can “convey[] title to the land from the United States to a private

party”); Thompkins-El v. Wells Fargo Bank Minnesota, 2006 WL 2433438, at *3 (E.D. Mich. Aug. 22,

2006) (“Land patents are essentially deeds that document a transfer in ownership from the

Federal Government to individuals that purchase public land.”).

then discusses the Complaint’s factual allegations relevant to the government’s motion

dismiss, and finally summarizes Silver State’s prior APA litigation.

A. Statutory And Regulatory Background

The Federal Land Policy and Management Act of 1976 (“FLPMA”) is a complex

statute that provides for a nevertheless straightforward process by which BLM may

enter into contracts to sell tracts of federally-owned public land. In particular, the

FLPMA and its implementing regulations govern the process for the offer, acceptance,

consideration, and authority for land sale contracts executed pursuant to that statute.

1. The Federal Land Policy And Management Act Of 1976

Prior to 1976, “[i]n various enactments, Congress empowered United States

citizens to acquire title to, and rights in, vast portions of federally owned land” by

purchasing land from the federal government. Lujan v. Nat’l Wildlife Fed’n, 497 U.S. 871,

875 (1990). Congress recognized, however, that the government’s “[m]anagement of the

public lands under these various laws [was] chaotic.” Id. at 876. As a result, and due to

“the need to provide guidance and a comprehensive statement of congressional policies

concerning the management of the public lands, Congress enacted the [FLPMA].”

Rocky Mountain Oil & Gas Ass’n v. Watt, 696 F.2d 734, 737–38 (10th Cir. 1982).

The FLPMA — which BLM today considers its organic statute 5 — “contain[s]

many interdependent sections in order to provide the BLM with a versatile framework

for its management efforts.” Id. at 738. Section 203 of the FLPMA, codified at

43 U.S.C. § 1713, is the primary statute at issue in this case and governs BLM’s sales of

tracts of public land. Pub. L. 94–579, October 21, 1976, 90 Stat. 2743 (codified at 43

U.S.C. § 1713) [hereinafter “Section 1713” or “§ 1713”].

Section 1713 of Title 43 of the United States Code — governing “Sales of public

land tracts” — begins by defining the types of tracts of public land BLM may sell. In

particular, the FLPMA provides that BLM may sell tracts of public land “where, as a

result of land use planning . . . the Secretary determines that the sale of such tract

5While the Truman administration created BLM in 1946 by combining the General Land Office

and the U.S. Grazing Service, BLM considers the FLPMA its “organic statute” because the

FLPMA is the “principal law defining [BLM’s] mission.” Bureau of Land Management, Dep’t of

the Interior, National History, History of the BLM,

https://www.blm.gov/about/history/timeline (last visited Apr. 10, 2020). “The Federal Land

Policy and Management Act of 1976, as amended, is the Bureau of Land Management’s ‘organic

act’ that establishes the agency’s multiple-use and sustained yield mandate to serve present and

future generations.” Bureau of Land Management, Dep’t of the Interior, The Federal Land Policy

and Management Act of 1976, (2016), https://www.blm.gov/about/laws-and-regulations.

meets” one of three “disposal criteria.” 6 43 U.S.C. § 1713(a). After imposing certain

additional requirements on BLM’s sales of “land of agricultural value and desert in

character” 7 and “tracts in excess of two thousand five hundred acres,” 8 neither of which

considerations is applicable in this case, the FLPMA mandates that BLM cannot sell

tracts of public land for “less than their fair market value as determined by the

Secretary.” Id. § 1713(d). The FLPMA further directs BLM to “determine . . . tracts of

public lands to be sold on the basis of the land use capabilities and development

requirements of the land.” Id. § 1713(e).

After BLM identifies a tract of public land for a proposed sale, the FLPMA

delineates the procedures that BLM must follow to invite and consider offers to

purchase that land. In general, BLM must conduct sales of — and receive offers to

purchase — tracts of public land pursuant to “competitive bidding procedures to be

established by the Secretary.” Id. § 1713(f) (emphasis added). BLM also may employ

“modified competitive bidding” procedures — or the Agency may even sell land

“without competitive bidding” (called a “direct sale”) — when the “Secretary

determines it necessary and proper in order (1) to assure equitable distribution among

purchasers of lands, or (2) to recognize equitable considerations or public policies,

including but not limited to, a preference to users[.]” Id.

In addition to detailing BLM’s procedures for seeking and receiving offers to

purchase tracts of public land identified for sale, the FLPMA governs the process for

BLM’s acceptance of an offer. Id. § 1713(g) (“Acceptance or rejection of offers to

purchase”). In particular, the FLPMA provides BLM with only three, discrete options

6 Specifically, the FLPMA authorizes land sales where the Secretary determines that:

(1) such tract because of its location or other characteristics is difficult and

uneconomic to manage as part of the public lands, and is not suitable for

management by another Federal department or agency; or

(2) such tract was acquired for a specific purpose and the tract is no longer required

for that or any other Federal purpose; or

(3) disposal of such tract will serve important public objectives, including but not

limited to, expansion of communities and economic development, which cannot

be achieved prudently or feasibly on land other than public land and which

outweigh other public objectives and values, including, but not limited to,

recreation and scenic values, which would be served by maintaining such tract in

Federal ownership.

43 U.S.C. § 1713(a)(1)–(3).

7 Id. § 1713(b).

8 Id. § 1713(c) (congressional approval procedures applicable to tracts exceeding 2500 acres).

upon receipt of offers from prospective, qualified land purchasers; BLM: (1) “shall”

accept the offer; (2) “shall” reject the offer; or (3) “may refuse to accept any offer or

may withdraw any land or interest in land from sale under this section [after]

determin[ing] that consummation of the sale would not be consistent with this Act or

other applicable law.” 9 Id. Thus, BLM may decline to accept any particular offer to

purchase the land being sold, or it may reverse course and decide not to subject the

identified parcel of land to sale at all, but the agency must elect one of those choices “no

later than thirty days after the receipt of” a purchase offer. Id. 10

2. BLM’s Land Sale Regulations

In addition to governing BLM land sales, the FLPMA vests the Secretary of the

Interior with authority to “promulgate rules and regulations to carry out the purposes

of this Act and of other laws applicable to the public lands.” 43 U.S.C. § 1740.

Consistent with that provision, the Secretary promulgated regulations to “implement

the sale authority of [Section 1713].” 43 C.F.R. § 2710.0-1. Those regulations are

contained in 43 C.F.R. Subparts 2710 and 2711.

Subpart 2710 specifies “General Provisions” that apply to BLM’s public land

sales. Those “General Provisions” address, among other topics, the purpose,

authority, 11 and policy underlying the regulations. In that regard, the regulations’

objective – consistent with the FLPMA’s terms – is to “provide for the orderly

9 The FLPMA defines “withdrawal” – a term of art – to mean “withholding an area of Federal

land from settlement, sale, location, or entry, under some or all of the general land laws, for the

purpose of limiting activities under those laws in order to maintain other public values in the

area or reserving the area for a particular public purpose or program; or transferring

jurisdiction over an area of Federal land, other than ‘property‘ governed by the Federal

Property and Administrative Services Act, as amended from one department, bureau or agency

to another department, bureau or agency.” 43 U.S.C. § 1702(j). “To withdraw, then, means to

withhold the parcel of land from sale entirely, not to cancel a specific sale to a specific buyer.”

Silver State II, 843 F.3d at 991. Consistent with the D.C. Circuit’s conclusion in Silver State II,

neither party contends before this Court that “withdrawal” occurred here.

10Alternatively, BLM has until “the end of thirty days after the end of the ninety-day

[congressional notification] period” applicable to land tracts in excess of 2500 acres,

43 U.S.C. § 1713(g), but that time period is inapplicable to the alleged sale at issue in this case.

11Although the FLPMA and implementing regulations identify the Secretary of the Interior as

the government official with authority to sell tracts of public land, see 43 U.S.C. § 1713,

43 C.F.R. § 2710.0-3, the Secretary has “delegated the authority” to certain “authorized

officer[s]” within BLM. 43 C.F.R. § 2710.0-5(c). Those authorized officers possess the authority

to contract for land sales on behalf of the United States. The requirements for a valid contract

with the United States include “a Government representative who had actual authority to bind

the Government.” Trauma Serv. Grp. v. United States, 104 F.3d 1321, 1326 (Fed. Cir. 1997).

disposition at not less than fair market value of public lands identified for sale as part of

the land use planning process.” 43 C.F.R. § 2710.0-2.

Subpart 2711 provides more detailed “Procedures” implementing the FLPMA

and governing the offer, acceptance, consideration, and authority for land sale

contracts. BLM‘s regulatory “Procedures” are divided into five sections: (1) Initiation

of Sale; (2) Qualified Conveyees; (3) Procedures for Sale; (4) Compensation for

Authorized Improvements; and (5) Conveyance Documents. See 43 C.F.R. §§ 2711.1–.5.

Echoing the FLPMA itself, the regulations provide that BLM’s sales of tracts of

public land begin with the “[i]dentification of tracts by land use planning.”

43 C.F.R. § 2711.1-1. Additionally, the regulations permit the public to make

“nominations” – or “requests for sales of [government-owned] public lands” – by

submitting such requests “to the District office of the [BLM] for the District in which the

public lands are located” and “specifically identify[ing] the tract being nominated or

requested and the reason for proposing sale of the specific tract.” Id. § 2711.1-1(c).

If BLM decides to sell a tract of land, FLPMA regulations require BLM to issue,

publish in the Federal Register, and send to interested parties a Notice of Realty Action

(“NORA”). 43 C.F.R. § 2711.1-2(a), (d). The NORA constitutes an “offering for sale [of]

a tract or tracts of public lands identified for disposal.” 12 Id. § 2711.1-2(a). A BLM

“authorized officer” must publish the NORA “not less than 60 days prior to the sale.”

Id. Additionally, the regulations require the NORA to “include the terms, covenants,

conditions and reservations which are to be included in the conveyance document.” Id.

Finally, the NORA must include a description of the “method of sale.” Id. The

regulations and the resulting NORA thus distinguish between sale procedures, the sale

itself, and the conveyance that occurs after, and results from, the sale.

The regulations further limit who may purchase public lands. In particular, and

as relevant here, the regulations provide that BLM may convey a tract of public land to

a “corporation subject to the laws of any State or of the United States,” among others.

43 C.F.R. § 2711.2 (identifying four categories of qualified purchasers).

Next, the regulations identify and describe the three types of “Procedures for

Sale” that BLM may utilize to seek and receive offers to purchase a tract of public land:

(1) competitive bidding; (2) modified bidding; and (3) direct sales. Id. §§ 2711.3-1–3.

12While the regulation’s use of the word “offering” suggests that a NORA may itself constitute

an offer, the NORA – as demonstrated below – cannot be interpreted as anything more than an

invitation for bids (or, possibly, as the defendant contends, the advertisement governing an

auction).

These categories mirror the ones created by the FLPMA itself. See 43 U.S.C. § 1713(f)

(addressing “competitive bidding,” “modified competitive bidding,” and sales

“without competitive bidding”).

In this case, the parties do not dispute that BLM employed the modified

competitive bidding procedures delineated in 43 C.F.R. § 2711.3-2. Accordingly, the

Court here focuses on those procedures.

First, 43 C.F.R. § 2711.3-2 provides that BLM “may . . . offer[]” a tract of public

land for sale “utilizing modified competitive bidding procedures when the authorized

officer determines it is necessary in order to assure equitable distribution of land among

purchasers or to recognize equitable considerations or public policies.”

43 C.F.R. § 2711.3-2(a). Second, the regulation operationally defines modified bidding

to permit BLM to select a “designated bidder” that has “the right to meet the highest

bid” the Agency receives pursuant to the NORA’s bidding process. Id. § 2711.3-

2(a)(1)(i). If the “designated bidder[] fail[s] to exercise the preference consideration

offered by the authorized officer in the allowed time, the sale shall proceed,” with the

high bidder as the successful offeror. Id. § 2711.3-2(c).

Once BLM decides to utilize modified competitive bidding, the regulations

require BLM to publish in the Federal Register a NORA that includes a “description of

the method of modified competitive bidding to be used and a statement indicating the

purpose or objective of the bidding procedure selected.” Id. § 2711.3-2(a)(2), (d). As

noted above, the NORA thus serves as an invitation for bids (“IFB”), specifying the tract

of public land for sale, along with its appraised fair market value. Id. § 2711.1-2(a).

Prospective purchasers then must submit bids in accordance with the NORA, just like

participants in any sealed-bid procurement process must comply with the governing

IFB. 13 “Once the method of modified competitive or noncompetitive sale is determined

and such determination has been issued, published and sent in accordance with

13Cf. Federal Acquisition Regulation (“FAR”) 14.301(a) (“To be considered for award, a bid

must comply in all material respects with the invitation for bids.”). Although the FAR does not

apply to the formation of the contract at issue because it was for a government sale of property

and not an acquisition, see FAR 1.104, the FAR nevertheless is instructive regarding background

federal contracting principles. See Huntsville Times Co. v. United States, 98 Fed. Cl. 100, 106 n.6

(2011) (consulting the FAR in a non-FAR procurement “[t]o the extent that basic procurement

fairness principles are elucidated” therein); see also SUFI Network Servs., Inc. v. United States, 105

Fed. Cl. 184, 195 (2012) (“[T]he FAR is highly relevant as a guide in the absence of other

guidance.” (internal quotations omitted)).

procedures of this part, payment shall be by the same instruments as authorized in

§ 2711.3–1(c) of this subpart.” Id. § 2711.3-2(d). 14

The FLPMA’s land sale regulations — again, mirroring the statute itself — also

govern BLM’s acceptance of a purchase offer and provide that BLM’s “[a]cceptance or

rejection of any offer to purchase shall be in accordance with the procedures set forth in

§ 2711.3–1 (f) and (g) of this subpart.” 43 C.F.R. § 2711.3-2(e). In turn, 43 C.F.R.

§ 2711.3-1(f) requires the authorized BLM officer: (1) to accept an offer; (2) to reject an

offer; or (3) to withdraw the tract of public land from sale. In particular, the regulation

provides that BLM must accept or reject an offer “in writing no later than 30 days after

receipt of such offer.” Id. § 2711.3-1(f). Additionally, prior to the expiration of the 30

day period, BLM may “refuse to accept any offer or . . . withdraw any tract from sale” 15

after determining that:

(1) Consummation of the sale would be inconsistent with the

provisions of any existing law; or

(2) Collusive or other activities have hindered or restrained

free and open bidding; or

(3) Consummation of the sale would encourage or promote

speculation in public lands.

Id.; see Sales—Federal Land Policy and Management Act; Sale of Public Lands, 45 Fed.

Reg. 39,416, 39,420 (June 10, 1980) (listing the foregoing criteria as clearly applying not

only to a decision to “withdraw any tract from sale,” but also to a decision to “refuse to

accept any offer”).

Of significance for this case, 43 C.F.R. § 2711.3–1(g) conditions the selected,

successful offeror’s contract rights only upon its tendering consideration in the form of

the actual payment of the total promised purchase price:

Until the acceptance of the offer and payment of the purchase price,

the bidder has no contractual or other rights against the

1443 C.F.R. § 2711.3-1(c) provides, in pertinent part, that “[e]ach bid shall be accompanied by

certified check, postal money order, bank draft or cashier's check made payable to the

[BLM] . . . .”

15Although not applicable in this case, the Agency also may take one of these actions prior to

the “expiration of 30 days after the end of the [congressional] notice” period. 43 C.F.R. § 2711.3-

1(f).

United States, and no action taken shall create any contractual

or other obligations of the United States.

43 C.F.R. § 2711.3-1(g) (emphasis added).

The FLPMA and its implementing regulations thus provided the framework for

the formation of the contract at issue in this case. With that framework in mind, the

Court next turns to the Complaint’s factual allegations relevant to the government’s

motion to dismiss.

B. Factual Allegations

The City of Henderson, Nevada (“Henderson”) is adjacent to the City of Las

Vegas and contains, within its boundaries, certain tracts of public land. 16 In early

September 2011, Henderson and Las Vegas National Sports Center LLC (“LVNSC”)

entered into a master project agreement (“MPA”) concerning one of those tracts of

public land. 17 Appx. A1-21. 18 The MPA contemplated that Henderson would nominate

a tract of public land for sale by BLM to LVNSC, which would “plan, design, develop,

construct, complete, and operate” up to four sporting-event venues capable of hosting

various professional sports leagues. Appx. A2.

On September 7, 2011, Henderson requested that BLM utilize the direct sale

procedures pursuant to 43 C.F.R. § 2711.3-3 to sell an approximately 480-acre tract of

public land within Henderson’s boundaries (the “Property”) to LVNSC. Compl. ¶ 7;

Appx. A22. On October 4, 2011, BLM notified Henderson that the Agency could not

appropriately utilize the direct sale procedures pursuant 43 C.F.R. § 2711.3-3. Compl.

¶ 10; Appx. A26-27. Instead, BLM suggested that the use of modified competitive

See generally City of Henderson, Nevada, https://www.cityofhenderson.com/ (last visited

16

Apr. 28, 2020).

17See Silver State I, 145 F. Supp. 3d at 117 n.3. Silver State’s Complaint alleges that Henderson

and LVNSC entered into the MPA on October 18, 2011. Compl. ¶ 9. Silver State I and the

appendix to the government’s motion to dismiss indicate, however, that Henderson and

LVNSC entered into an initial MPA in early September 2011, but then subsequently “amended

and restated” the MPA on October 18, 2011. In any event, the date on which Henderson and

LVNSC entered into the MPA is immaterial to this decision.

The government attached an appendix to its motion to dismiss, containing certain documents,

18

many of which Silver State’s complaint incorporates by reference. This Court may consider

“matters incorporated by reference or integral to the claim” in ruling on a motion to dismiss

pursuant to RCFC 12(b)(6). Dimare Fresh, Inc., 808 F.3d at 1306 (internal quotation omitted). The

Court cites to those documents using the abbreviation “Appx. A_,” with the relevant page

number inserted.

bidding procedures pursuant to 43 C.F.R. § 2711.3-2; BLM sought Henderson’s

concurrence in that approach. Compl. ¶ 10; Appx. A26-27. On October 10, 2011,

Henderson notified BLM that Henderson concurred with the Agency’s plan to offer the

Property via the modified competitive bidding procedures at 43 C.F.R. § 2711.3-2 and to

identify LVNSC as the designated bidder with the right to match the highest offer.

Appx. A28.

On October 18, 2011, Henderson and LVNSC entered into an amended and

restated MPA. Appx. A31. In early 2012, BLM agreed to substitute Silver State, an

affiliate of LVNSC, as the designated bidder in the planned sale of the Property.

Compl. ¶ 11.

On April 4, 2012, BLM published a NORA in the Federal Register for the

“Modified Competitive, Sealed-Bid Sale” of the Property. Compl. ¶ 12; Notice of Realty

Action: Modified Competitive, Sealed-Bid Sale of Public Land in Clark County, NV,

77 Fed. Reg. 20,413 (Apr. 4, 2012) (Appx. A73). The NORA began with a “Summary”

section, which provided that BLM “proposes to offer [the Property] by modified

competitive, sealed-bid sale . . . at not less than the appraised fair market value (FMV)

of $10,560,000.” 77 Fed. Reg. at 20,413 (Appx. A73). The “Summary” section further

provided that “[t]he sale will be subject to the applicable provisions of Section[] 203 of

the [FLPMA] . . . and BLM land sale regulations at 43 CFR 2710.” Id. Section 203 of the

FLPMA is codified at 43 U.S.C. § 1713. The NORA then included a “Dates” section,

which specified that BLM must receive all sealed-bid offers to purchase the Property by

June 4, 2012, the date upon which BLM indicated it would open the sealed bids. Id.

After several short sections regarding how to contact the Agency with questions

or comments, the NORA contained a “Supplementary Information” section. Id. The

“Supplementary Information” section described the Property, id. at 20,413-14 (Appx.

A73-74), and provided that “[t]he use of the modified competitive, sealed-bid sale

method is consistent with the regulations at 43 CFR 2711.3-2(a).” Id. at 20,414 (Appx.

A74). The section further notified potential offerors that Silver State was the

“designated bidder.” Id.

Following the “Supplementary Information” section, the NORA included a “Sale

procedures” section. 77 Fed. Reg. at 20,414 (Appx. A74). That section of the NORA

informed all offerors that any bid must include a “bid guarantee deposit” and a check

for twenty percent of the total bid amount. Id. Because Silver State was the designated

bidder, the NORA’s “Sale procedures” section required Silver State’s authorized

representative to “be present at the bid opening.” Id. The “Sale procedures” section

then provided that “[a]cceptance or rejection of any offer to purchase will be in

accordance with the regulations at 43 CFR 2711.3-1(f) and (g).” Id. Finally, the “Sale

procedures” section provided:

Within 30 days of the sale, the BLM will, in writing, either

accept or reject all bids received. No contractual or other rights

against the United States may accrue until the BLM authorized

officer officially accepts the high bid offer to purchase and the

full bid price is paid.

Id. This provision in the NORA reflects the requirements of the FLPMA and its

implementing regulations, as described above.

Finally, the NORA included a specific “Terms and Conditions” section. 77 Fed.

Reg. at 20,415 (Appx. A75) (italics in original). That section provided terms and

conditions for a contract resulting from the “Sale procedures,” in addition to certain

“numbered terms, conditions, and reservations [that would] appear on the conveyance

document.” Id. 19 Thus, the NORA’s “Terms and Conditions” section contained

contractual terms, including the repeated condition that “[n]o contractual or other

rights against the United States may accrue until the BLM officially accepts the offer to

purchase, and the full bid price is submitted by the 180th day following the sale.” Id.

The section further provided:

In accordance with 43 CFR 2711.3-1(f), the BLM may accept or

reject any or all offers to purchase, or withdraw any parcel of

land or interest therein from sale, if, in the opinion of a BLM

authorized officer, consummation of the sale would be

inconsistent with any law, or for other reasons as may be

provided by applicable law or regulations.

Id. at 20,416 (Appx. A76) (emphasis added). As this Court explains below, and

pursuant to the plain language of 43 C.F.R. § 2711.3-1(f) and the NORA, 20 BLM was

required to make any such decision “no later than 30 days after receipt of” offers. This

“Terms and Conditions” section did not include any requirement that Silver State adhere

to the MPA, nor would it have made sense to include such a requirement because the

19As explained above, the conveyance document is known as a land patent and is the document

the United States uses to convey title of public land to purchasers. See 43 C.F.R. § 2711.5 (noting

that a patent is a conveyance document).

20Appx. A74 (“Within 30 days of the sale, the BLM will, in writing, either accept or reject all

bids received.”).

NORA also permitted – and would have governed – potential competing offers, while

the MPA was solely between Silver State’s affiliate and Henderson.

On June 4, 2012, Silver State submitted a bid – consistent with the NORA’s terms

– in the amount of $10,560,000, matching the NORA’s appraised fair market value of the

Property. Compl. ¶ 14; Appx. A84. Per the NORA’s requirement, Silver State included

certified checks totaling $2,132,000 with its bid and otherwise met all the NORA’s

requirements. Compl. ¶ 14; Appx. A92. Because BLM did not receive any other offers

to purchase the Property, Silver State had no need to exercise its preference right as the

“designated bidder” to match another prospective purchaser’s high bid.

On June 12, 2012, BLM issued a written acceptance of Silver State’s offer. Compl.

¶ 15; Appx. A94-95. BLM’s “Acceptance of Bid” letter (“Acceptance Letter”) to Silver

State instructed that Silver State had “180 days from the sale date . . . to pay the

[remaining] balance of $8,428,000,” i.e., the bid price after deducting the down payment

that Silver State had included with its bid. Appx. A95 (emphasis added). BLM’s

Acceptance Letter further warned Silver State that “[f]ailure to submit the balance by

December 3, 2012, [would] result in cancellation of the sale.” Id. The Acceptance Letter

required Silver State to provide evidence that it was a U.S. corporation “authorized to

hold property or an entity legally capable of conveying lands or interests there in [sic]

under the laws of the State of Nevada,” and cautioned that failure to submit such

evidence “within 30 days from the sale date of June 4, 2012, shall result in the

cancellation of the sale.” Id. (emphasis added). The Agency specified no other potential

grounds of cancellation in the Acceptance Letter.

On or about August 16, 2012, BLM issued to Silver State escrow instructions,

which both parties executed. Compl. ¶ 16; Appx. A96-97. The instructions were “for

use in processing a land patent through escrow to Silver State Land LLC pursuant to

Section 203 [of the FLPMA]” and “pursuant to Section 4(a) of the Southern Nevada

Public Land Management Act of 1998, P.L. 105-263, 111 Stat. 2343, et seq.,” by BLM “on

behalf of the United States of America.” Appx. A96. The escrow instructions to which

the parties agreed provided that “[t]he transaction is found to be in the public interest

and otherwise in conformance with the laws and regulations.” Id. The instructions

further provided that “failure to pay the full price on or before the [sic] December 3,

2012, to either BLM or the escrow company, disqualifies the bid and the bidder will

forfeit their [sic] entire bid deposit to BLM.” Id. Upon such timely payment (or, more

precisely, “[e]vidence of payment”), “BLM will then provide the patent and

Acknowledgment of Delivery to Nevada Title [— the escrow agent —] within 30 days.” Id.

(bold added, italicized text in original). No other conditions for delivery of the patent

were specified, and the escrow instructions further caveated that “[c]hanges may be

made by mutual agreement of the parties” and “must be in writing and signed by the

[sic] all parties named below.” Id. The document was executed by a BLM official and a

representative of the “Patentees(s)” – a reference to Silver State. Id. at A97.

Subsequent bilateral, written amendments to the initial, executed escrow

instructions extended BLM’s contractual deadline for patent delivery, but no such

amendment ever deleted either (1) BLM’s commitment that it “will . . . provide the

patent[,]” or (2) the parties’ agreement that the “transaction is found to be in the public

interest and otherwise in conformance with the laws and regulations.” Appx. A96

(emphasis added).

Several days before the payment due date, on November 28, 2012, Silver State

tendered $8,428,000 — the balance of the purchase price — into escrow. Compl. ¶ 17;

Appx. A98-101. The escrow officer notified BLM that Silver State had tendered the

balance into escrow at approximately 3:44 p.m. that day. Appx. A100. After Silver State

had tendered the balance of the purchase price into escrow, LVNSC terminated its MPA

with Henderson. 21 Compl. ¶ 19.

On November 29, 2012, Henderson notified BLM that LVNSC had terminated the

MPA; Henderson requested that BLM postpone conveying the land patent for the

Property to Silver State. Compl. ¶ 20; Appx. A102-04. On December 20, 2012, Silver

State and BLM agreed to extend the date by which the Agency had to convey the land

patent to Silver State, amending the escrow agreement in writing. Compl. ¶ 21; Appx.

A106-07. The amended escrow instructions provided that the purpose of the extension

was to “facilitate settlement discussions between [LVNSC] and the City of Henderson

regarding the uses of the land following patenting of the land by the United States.”

Appx. A106 (“Modifications for Escrow Instructions for N-90450”).

On January 28, 2013, Henderson filed suit against LVNSC, Silver State, and other

associated entities and individuals in Nevada state court, alleging various breach of

contract and fraud claims arising from LVNSC’s termination of the MPA. Compl. ¶ 22.

On February 5, 2013, Silver State and BLM agreed to a second extension of time for the

Agency to convey the land, via a patent, to Silver State. Compl. ¶ 23; Appx. A162-64.

On March 7, 2013, the Nevada state court dismissed all of Henderson’s non-

contract claims, and, on March 14, 2013, Silver State and Henderson executed a

settlement agreement, resolving the remaining contract claims. Compl. ¶ 24. At that

21As noted above, Henderson requested that BLM substitute Silver State, an affiliate of LVNSC,

as the designated bidder. Appx. A66. In early 2012, BLM agreed to substitute Silver State as the

designated bidder in the forthcoming sale of the Property. Compl. ¶ 11.

point, Silver State and BLM once again agreed to extend the time for BLM to convey the

land patent to Silver State, this time until May 13, 2013. Compl. ¶ 28; Appx. A183.

None of the escrow modifications extending the time for the Agency to deliver

the land patent for the subject Property – there were three extensions in total – ever

deleted or otherwise altered the parties’ finding in the original escrow instructions that

“[t]he transaction is . . . in the public interest and otherwise in conformance with the

laws and regulations.” Appx. A96; see also, e.g., Appx. A183 (March 14, 2013

Modifications for Escrow Instructions for N-90450) (agreement that “[a]ll other

instructions remain the same from the original August 2012 escrow instructions, as

amended on December 20, 2012 and February 5, 2013”). Nor, as noted above, did Silver

State ever agree to excuse BLM’s commitment that it “will . . . provide the patent” to

Silver State. Appx. A96 (emphasis added). On April 5, 2013, Henderson informed BLM

that Henderson no longer opposed BLM conveying the subject Property to Silver State.

Compl. ¶ 27; Appx. A187-88. On May 9, 2013, BLM sent Silver State a draft land patent

to review. Compl. ¶ 29.

On May 10, 2013, however, two BLM officials – the Acting Deputy Director for

Operations and BLM’s Nevada State Director – sent a memorandum to the Acting

Assistant Secretary for Land and Minerals Management (the “Assistant Secretary”),

entitled “Termination of Patent Issuance to Silver State Land, LLC, for Land Nominated

for Sale by the City of Henderson, Nevada for Arena Development Project.” Appx.

A189. As indicated in the title of that document, the BLM officials focused – as did the

parties’ subsequent APA litigation – on the Agency’s asserted power not to transfer the

land patent. Thus, in the memorandum, the BLM officials recommended that the

Assistant Secretary “take jurisdiction over this matter, pursuant to the authority

reflected in 43 C.F.R. § 4.5(a), and render a final decision on whether a land patent should

be issued to Silver State.” Appx. A192 (emphasis added). The BLM officials further

recommended that the Assistant Secretary direct BLM to “(i) not issue the patent to

Silver State, (ii) terminate the sale process, and (iii) take the steps necessary to return the

purchase deposit and bid guarantee to Silver State.” Appx. A192-93. This

recommendation was premised, at least in-part, on the Secretary of the Interior’s “broad

authority over the disposition of the public lands up to the point of patent issuance,

including the authority to make an independent evaluation as to whether the patent

should issue.”22

22Appx. A193 (emphasis added) (citing 209 DM 7; 98 I.D. 248, 250 (1991) [a Department of

Interior Manual]; Cameron v. United States, 252 U.S. 450, 459-64 (1920); Knight v. United States

Land Association, 142 U.S. 161, 177 (1891); United States v. Willamson, 75 I.D. 338, 342 (1968);

United States v. United States Borax Co., 58 I.D. 426, 430 (1943); Ideal Basic Industries, Inc. v. Morton,

On May 10, 2013, the Assistant Secretary issued a decision memorandum,

entitled “Termination of Patent Issuance to Silver State Land LLC, for Land Nominated

for Sale by the City of Henderson, Nevada for Arena Development Project.”

Compl. ¶ 30. The Assistant Secretary took “jurisdiction over this matter, pursuant to

the authority reflected in 43 C.F.R. § 4.5(a)” and issued a written decision, directing

BLM to:

(i) not issue the patent to Silver State, LLC, (ii) terminate the

sale process, and (iii) take the steps necessary to return the

purchase deposit and bid guarantee to Silver State, LLC,

($2,132,000) as expeditiously as practicable.

Compl. ¶ 31; Appx. A195. 23 No documents currently before the Court show that, before

issuing this written decision: (1) the Agency advised Silver State in writing in advance

of such action, (2) the Assistant Secretary requested the administrative record, or (3) the

Agency otherwise provided Silver State with an opportunity to respond to BLM’s

recommendation memorandum.

On May 13, 2013 — more than five months after Silver State terminated its MPA

with Henderson, but just four days after BLM transmitted a draft land patent to Silver

State for review — BLM declined to convey the land patent to Silver State, allegedly

contrary to the terms of the NORA, BLM’s acceptance of Silver State’s bid, and the

agreed-upon escrow instructions. Compl. ¶ 33.

C. Procedural History

On May 15, 2013, Silver State filed a complaint in the United States District Court

for the District of Columbia, “claiming that ‘the decision to withdraw the sale was

contrary to statutory limitations regarding the ability to withdraw the sale, and was

arbitrary and capricious,’ in violation of the Administrative Procedure Act.”

Silver State I, 145 F. Supp. 3d at 117. Silver State moved for summary judgment “to set

542 F.2d 1364, 1367-68 (9th Cir. 1976); West v. Standard Oil Co., 278 U.S. 200 (1927); Gabbs

Exploration Co. v. Udall, 315 F.2d 37, 40-41 (D.C. Cir.), cert. denied, 375 U.S. 822 (1963); United

States v. State of California (On Rehearing), 55 I.D. 532, 542-46 (1936)). None of those cited

decisions concerned a claim under the Tucker Act for the government’s breach of contract. See

Tr. at 80:13-20 (government conceding cited cases did not involve contracts for sale of property).

23The government characterizes the Assistant Secretary’s decision as an order to BLM to not

perform its contractual duty rather than an order terminating the contract. See Tr. at 95:13-14

(“There was no termination of the contract. There was an order not to perform.”). The Court

considers this characterization to be, at best, a distinction without a difference; taken literally,

however, the government appears to concede breach.

aside the [BLM] determination and order immediate delivery of the land patent to

[Silver State].” Id. Silver State challenged the:

decision not to issue the patent for the Property to [Silver

State] and to terminate the sale process on three principle

grounds: (1) the agency lacked authority to terminate the sale;

(2) the agency’s decision was arbitrary and capricious; and (3)

the agency violated the plaintiff’s due process rights by

terminating the sale without providing the plaintiff an

opportunity or reason to submit additional information.

Id. at 125 (internal citations and quotations omitted) (emphasis added). 24 The district

court “conclude[d] that the agency interpreted applicable statutory provisions and its

own regulations reasonably to provide authority to terminate the sale and,

consequently, the challenged decision was not arbitrary and capricious but supported

by substantial evidence, and that the plaintiff’s due process rights were not violated.”

Id. The district court further held – and this is particularly relevant here – that the

Secretary has “plenary power . . . to determine the lawfulness of the issuance of a patent”

and that the FLPMA does not constrain that power. Id. at 128 (emphasis added).

Consequently, the district court denied Silver State’s motion for summary judgment. Id.

Silver State appealed that decision to the United States Court of Appeals for the

District of Columbia Circuit. Silver State II, 843 F.3d at 985. The D.C. Circuit reviewed

the Agency action de novo to determine whether the action was “arbitrary, capricious, an

abuse of discretion, or otherwise not in accordance with law.” Id. at 989 (quoting

5 U.S.C. § 706(2)(A)). The D.C. Circuit affirmed the district court’s judgment, holding

“that the Secretary had plenary power to terminate the land sale, and that the [FLPMA]

did not constrain the Secretary’s power” to refuse to provide the land patent. Id. at 985.

The D.C. Circuit concluded, in particular, that 43 U.S.C. § 2 “includes the authority to

terminate a land sale using a modified competitive auction where the basis for the

modified auction dissipates.” Id. at 989. 25 The D.C. Circuit further held that the FLPMA

“does not limit the Secretary’s plenary power [under 43 U.S.C. § 2].” Id. at 992.

The district court does not appear to have addressed the latter ground in terms of the

24

Agency’s compliance (or lack thereof) with 43 C.F.R. § 4.5(c). See, infra, Section III.B.5.

25 43 U.S.C. § 2 provides:

The Secretary of the Interior or such officer as he may designate

shall perform all executive duties appertaining to the surveying

and sale of the public lands of the United States, or in anywise

respecting such public lands, and, also, such as relate to private

Neither the district court nor the D.C. Circuit ruled on the contract issues central

to this case. 26 Instead, the D.C. Circuit agreed that “the District Court correctly noted”

as follows:

This regulation [43 C.F.R. § 2711.3-1(g)] merely delineates

when an offeror has no contractual rights, and not when

contractual rights do attach. Furthermore, to the extent this

regulation may confer any contractual right upon an offeror

whose offer has been accepted, the regulation is silent as to

what those rights may be.

Silver State II, 843 F.3d at 992 (quoting Silver State I, 145 F. Supp. 3d at 131 n.14) (italics in

original).

On May 9, 2019, Silver State filed its original complaint in this Court. On

October 24, 2019, Silver State filed its amended Complaint. On November 7, 2019, the

government filed a motion to dismiss Silver State’s Complaint pursuant to RCFC

12(b)(6). The parties fully briefed the motion, the Court held oral argument on

February 26, 2020, and the parties filed post-argument supplemental briefs on March 11,

2020.

II. Standard Of Review

The government moves to dismiss Silver State’s Complaint pursuant to

RCFC 12(b)(6). When considering a motion to dismiss a complaint for failure to state a

claim upon which relief may be granted pursuant to RCFC 12(b)(6), the Court accepts as

true all factual allegations — but not legal conclusions — contained in a plaintiff’s

complaint. See Twombly, 550 U.S. at 555. For a plaintiff’s complaint to survive a motion

to dismiss, the Court — viewing the facts in the light most favorable to the plaintiff —

must conclude that “the plaintiff pleads factual content that allows the court to draw

the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal,

556 U.S. at 678 (citing Twombly, 550 U.S. at 556). “[O]f course, a well-pleaded complaint

may proceed even if it strikes a savvy judge that actual proof of [the facts alleged] is

improbable, and that a recovery is very remote and unlikely.” Twombly, 550 U.S. at 556

(citations and internal quotation marks omitted); Chapman Law Firm Co. v. Greenleaf

claims of land, and the issuing of patents for all grants of land under

the authority of the Government.

26See, infra, Section IV; see also Def. Reply at 10 (“Silver State shuns any preclusive effects of its

prior APA suit here because ‘no contractual rights or liabilities’ were decided by the district

court and D.C. Circuit…We have never contended otherwise.” (internal citations omitted)).

Constr. Co., 490 F.3d 934, 938 (Fed. Cir. 2007) (noting that the Court’s duty is not to

determine “whether the claimant will ultimately prevail” when ruling on a 12(b)(6)

motion to dismiss). A plaintiff may not simply plead “labels and conclusions” or “a

formulaic recitation of the elements of a cause of action.” Twombly, 550 U.S. at 555

(citations omitted).

III. Silver State’s Amended Complaint States A Claim For Breach Of Contract 27

The Tucker Act, 28 U.S.C. § 1491, establishes this Court’s jurisdiction and

provides:

The United States Court of Federal Claims shall have

jurisdiction to render judgment upon any claim against the

United States founded either upon the Constitution, or any

Act of Congress or any regulation of an executive department,

or upon any express or implied contract with the United

States, or for liquidated or unliquidated damages in cases not

sounding in tort.

28 U.S.C. § 1491(a).

In addition to conferring jurisdiction on the Court, the Tucker Act waives the

sovereign immunity of the United States “[f]or actions pursuant to contracts with the

United States[.]” Roth v. United States, 378 F.3d 1371, 1384 (Fed. Cir. 2004); see United

States v. Mitchell, 463 U.S. 206, 212-16 (1983). “To recover for breach of contract, a party

must allege and [ultimately] establish: (1) a valid contract between the parties, (2) an

obligation or duty arising out of the contract, (3) a breach of that duty, and (4) damages

caused by the breach.” San Carlos Irr. & Drainage Dist. v. United States, 877 F.2d 957, 959

(Fed. Cir. 1989). Silver State’s Complaint adequately alleges each of these elements.

Indeed, the documents that the government attached to its motion to dismiss all but

prove the Agency’s breach, although the Court does not definitively so decide that

issue, at this stage of the case. 28

27For the purposes of this section of the Court’s decision, the Court entirely puts to one side the

government’s issue preclusion and other defenses as grounds for dismissal, which are

addressed in subsequent sections of this decision.

28“Pursuant to RCFC 12(c), the trial court may convert a motion to dismiss into a motion for

summary judgment under RCFC 56 if it relies on evidence outside the pleadings.” Brubaker

Amusement Co. v. United States, 304 F.3d 1349, 1355 (Fed. Cir. 2002). “Whether to accept extra-

pleading matter on a motion for judgment on the pleadings and to treat the motion as one for

summary judgment is within the trial court’s discretion.” Easter v. United States, 575 F.3d 1332,

A. Silver State’s Complaint Alleges The Parties Had An Express Contract

That The Government Breached

To recover for breach of contract, a plaintiff must allege (and ultimately

establish) that the parties had a valid contract. The requirements for a valid contract

with the United States are: “mutual intent to contract including an offer and acceptance,

consideration, and a Government representative who had actual authority to bind the

Government.” Trauma Serv. Grp., 104 F.3d at 1326. Silver State’s Complaint adequately

alleges the existence of a valid, express contract between Silver State and BLM.

According to the Complaint, Silver State and BLM had a mutual intent to

contract for the conveyance of the Property and the Agency representative who entered

the agreement had authority to bind the United States in contract. Compl. ¶¶ 1, 14, 15,

17; Appx. A73-76, A84-101, A106-08, A162-64, 183-85. Specifically, on April 4, 2012,

BLM issued the NORA, 29 which invited both Silver State – as the designated bidder –

and the (qualified) public at large, to submit offers to BLM to purchase the Property on

certain terms and conditions. Compl. ¶ 12-13; Appx. A73-76.

Similar to an IFB in a procurement conducted pursuant to the FAR, the NORA at

issue here specifically invited prospective purchasers of the identified Property to

submit bids pursuant to the NORA’s terms governing the sale mechanics. This

included procedural requirements for the submission and acceptance of offers, 30 bidder

qualifications, 31 and the actual terms and conditions of the resulting land sale contract

itself (including provisions that ultimately would be inserted into a final conveyance

document, known as a land patent). 32

With regard to the sale process, the NORA required that “[s]ealed bids may be

mailed or delivered to the BLM Las Vegas Field Office, at the address below, beginning

May 21, 2012[,]” but “must be received by the BLM Las Vegas Field Office no later than

4:30 p.m. Pacific Time, June 4, 2012 in accordance with the sale procedures.”

1335 (Fed. Cir. 2009) (discussing RCFC 12(b)(6)). Silver State does not challenge the Court’s

consideration of the documents the government filed along with its motion to dismiss, and

neither party suggests the dismissal motion should be treated as one for summary judgment.

29The government does not dispute either (1) that the NORA was lawful when issued, or

(2) that the NORA was issued by an agency official with authority to do so.

30Appx. A74 (explaining how offerors must submit bids and how BLM will accept or reject bids

in the “Sale procedures” section).

31 Appx. A74 (specifying “qualified bidder[]” requirements pursuant to “Federal law”).

32Appx. A75 (“Terms and Conditions”) (“The following numbered terms, conditions, and

reservations will appear on the conveyance document for this parcel.”).

Appx. A73. The NORA also contained a section entitled “Sale procedures[,]” which

included detailed instructions for “sealed-bid” submissions, and further provided that

“sealed bids will be opened and recorded to determine the high bidder on June 4, 2012.

The high bid among the qualified bids received will be declared.” Id. at A74.

The NORA identified Silver State as the “designated bidder,” id., essentially

giving Silver State the right of first refusal by providing that Silver State would “have

the opportunity at the bid opening to meet and accept the high bid as the purchase

price.” Id. Only if Silver State declined the opportunity to match the “declared high

bid” would some other potential purchaser “be declared the successful bidder.” Id.

On June 4, 2012, and allegedly in compliance with the NORA’s terms, Silver State

submitted a valid offer to purchase the Property for the appraised fair market value of

$10,560,000, tendering $2,132,000 along with its offer, the latter sum representing the

required bid deposit and guarantee. Compl. ¶ 14; Appx. A84-92.

Whether the NORA is viewed as essentially an IFB (similar to those in the

procurement context, as per the FAR) or as effectuating an auction, 33 the result is the

same: the NORA invited bids in compliance with the NORA’s instructions, but BLM

had to accept a bid to form a contract. Lockheed Martin IR Imaging Sys., Inc. v. West, 108

F.3d 319, 320 (Fed. Cir. 1997) (“In sealed bid procurements the government solicits bids

by issuing an [IFB]. The IFB is not an offer by the government to purchase goods or

services: the prospective contractor’s bid is the offer, and the government’s award of the

contract is the acceptance. J. Cibinic & R. Nash, Formation of Government Contracts 153

(2d ed. 1986). In sealed bid procurements, acceptance by the government is made

without negotiation or material variation from the terms of the contractor’s offer.”).

Ordinarily, “case law makes clear that an invitation for bids issued by the

government constitutes a solicitation for an offer; the bid invitation is not an offer itself

from which plaintiff can create a binding agreement by accepting[.]” Essen Mall

Properties v. United States, 21 Cl. Ct. 430, 439–40 (1990). In this case, the Court holds that

there is no practical distinction between viewing the transaction at issue as having

arisen from an IFB or, as the government contends, an auction. Viewed under either

construct, offerors had to submit bids in compliance with the NORA’s instructions, the

terms of the NORA were binding upon both parties, and compliant bids by definition

offered the “Terms and Conditions” specified in the NORA. Erie Coal & Coke Corp. v.

United States, 266 U.S. 518, 520 (1925) (“The terms and conditions of the sale as set forth

33The government characterizes the land sale process described in the NORA as a “restricted

auction.” Def. Reply at 1.

in the advertisement were binding alike upon the United States and the bidders.”). 34 In

that regard, the NORA quite clearly restricted the Agency’s options upon the receipt of

bid submissions, informing prospective bidders that “[a]cceptance or rejection of any

offer to purchase will be in accordance with the regulations at 43 CFR 2711.3-1(f) and

(g).” Appx. A74 (emphasis added). Moreover, the NORA required that, “[w]ithin 30

days of the sale, the BLM will, in writing, either accept or reject all bids received.” Id.

(emphasis added). 35

On June 12, 2012, and consistent with the NORA, an authorized officer of BLM

issued an unequivocal and unambiguous 36 written acceptance of Silver State’s offer 37 to

34See also United States v. Purcell Envelope Co., 249 U.S. 313, 318 (1919) (“The procedure for the

advertising for bids” gives the government “the benefit of the competition of the market and

each bidder is given the chance for a bargain. It is a provision, therefore, in the interest of both

government and bidder, necessarily giving rights to both and placing obligations on both.”);

Particular types of offers—Requests for bids, 1 Williston on Contracts § 4:13 (4th ed.) (“Often

tenders or bids are advertised for by public corporations, municipalities, counties or states, or

private corporations. The rules governing such bidding are analogous to the rules governing

auction sales. Thus, an ordinary advertisement for bids or tenders is not itself an offer, but the

bid or tender is an offer which creates no right until accepted.”); Restatement (Second) of

Contracts § 28 (1981) (“Unless a contrary intention is manifested, bids at an auction embody

terms made known by advertisement, posting or other publication of which bidders are or

should be aware. . . .”); YRT Servs. Corp. v. United States, 28 Fed. Cl. 366, 398 (1993) (“Had the

instant selection process been conducted as a sealed bid, which it was not, failure to comply in

all material respects with the invitation for bids would have been fatal to the bidder's chances

for award.”); Commodities Recovery Corp. v. United States, 34 Fed. Cl. 282, 289 (1995) (“Auction

sales are viewed under the same rules pertaining to the formation of contracts generally. See, 1

Samuel Williston, Williston on Contracts § 29, (3rd ed. 1957). In auctions, the potential

purchaser’s bid is the equivalent of an offer to buy the merchandise. This offer is accepted by

the auctioneer upon the fall of the hammer.”). In this case, of course, there was no auctioneer’s

“hammer,” but rather BLM issued a formal Acceptance Letter to Silver State. But see Frankel v.

United States, 842 F.3d 1246, 1250 (Fed. Cir. 2016) (“the majority of courts have long interpreted

announcement of a contest as a contractual offer by a sponsor and entry into the contest by a

contestant as acceptance of that offer”).

35See Prineville Sawmill Co. v. United States, 859 F.2d 905, 912 (Fed. Cir. 1988) (“Nor do we believe

that the express reservation contained in the advertisement in which the Forest Service reserved

the right to reject all bids allows the Service the discretion to be arbitrary or capricious in

rejecting all bids.”).

36The Acceptance Letter is subtitled “Acceptance of Bid,” and characterized the government as

having “offered” a “parcel of public land” – clearly via the NORA – to Silver State in “a

modified competitive sealed bid sale” process. Appx. A94.

37Again, although not applicable to the land sale at issue, the FAR nevertheless supplies an

instructive definition of the term “offer.” “Offer means a response to a solicitation that, if

purchase the Property, conditioned only upon Silver State’s fulfilling its promise to pay

into escrow $8,428,000 – the remaining balance of the purchase price – prior to

December 3, 2012. Compl. ¶ 15; Appx. A94-95. The Acceptance Letter indicated that

Silver State “must now submit the remaining balance in the amount of $8,428,000.00, by

December 3, 2012.” Appx. A94. 38 Finally, the Acceptance Letter provided that

“[f]ailure to submit the balance by December 3, 2012, shall result in cancellation of the

sale and forfeiture of [Silver State’s] 20 percent deposit.” Id.

The government does not assert that BLM’s acceptance of Silver State’s offer was

somehow unauthorized or otherwise improper or contrary to law at the time of

acceptance; nor does the government deny that the parties formed a contract once Silver

State paid the full purchase price for the Property. Transcript of Oral Argument (“Tr.”)

at 13:10-15 (“THE COURT: Does the government agree that upon payment – the final

payment of the full purchase price, that at that point in time, there was a contract by

Silver State with the United States for the purchase of the land in question? MR.

ROSENBERG: Yes.”); id. at 40:1-3 (“MR. ROSENBERG: [The contract] was not void [ab

initio]. It was only the intervening change of the events that rendered it to be out of

compliance with the law.”).

Ordinarily, BLM’s mere written acceptance of Silver State’s offer to purchase the

subject Property would have resulted in an enforceable contract. 39 In this case,

accepted, would bind the offeror to perform the resultant contract. Responses to invitations for

bids (sealed bidding) are offers called ‘bids’ or ‘sealed bids[.]’” FAR 2.101.

38 The Acceptance Letter also reiterated the qualified bidder requirements first specified in the

NORA, and instructed Silver State to submit certain documentation demonstrating its

qualification to purchase the Property “within 30 days from the sale date of June 4, 2012,” and

that failure to submit to submit such documentation “shall result in the cancellation of the sale.”

Appx. A95 (emphasis added). The Acceptance Letter itself thus demonstrates that BLM viewed

its written acceptance of Silver State’s offer to constitute “the sale.” Silver State already had

submitted the required documentation with its bid. Appx. A85-92.

39 A-Transp. Northwest Co. v. United States, 36 F.3d 1576, 1581 (Fed. Cir. 1994) (“[T]he

Government was empowered to create a contract by accepting A–Transport's offer. This it did

in November 1986, when it notified those carriers whose tenders had been accepted.”);

Restatement (Second) of Contracts § 50 (1981) (“The typical contract consists of mutual promises

and is formed by an acceptance constituting a return promise by the offeree. A promissory

acceptance may be explicitly required by the offer, or may be the only type of acceptance which

is reasonable under the circumstances….”); McMaster Const., Inc. v. United States, 23 Cl. Ct. 679,

684 (1991) (“sealed bid procurements result in contracts upon acceptance or award by the

[contracting officer]”), declined to follow on other grounds by Southfork Sys., Inc. v. United States, 141

F.3d 1124, 1133 (Fed. Cir. 1998). Although the Acceptance Letter appears to have been

completely consistent with the NORA, even if the acceptance were treated as a BLM

counteroffer to Silver State, the latter accepted the terms of the Acceptance Letter when Silver

however, the NORA’s terms made clear that “[n]o contractual or other rights against

the United States may accrue until [1] the BLM authorized officer officially accepts the

high bid offer to purchase and [2] the full bid price is paid.” Appx. A74; see also id. at

A75 (“No contractual or other rights against the United States may accrue until the BLM

officially accepts the offer to purchase, and the full bid price is submitted by the 180th

day following the sale.”). 40

On November 28, 2012, in compliance with the NORA, the terms of the

Acceptance Letter, and the escrow agreement that the parties executed on or about

August 17, 2012, see Appx. A96-97, Silver State tendered $8,428,000 into escrow, thereby

paying for the Property on time and in full. Compl. ¶ 17; see also Appx. A98-101

(evidence of timely payment).

Accordingly, as of November 28, 2012, when Silver State transmitted its final,

total payment for the Property, Silver State and BLM unequivocally formed a valid,

express, written contract 41 that consisted of: (1) the NORA (or at least certain provisions

State tendered the balance due by the specified date. See First Commerce Corp. v. United States,

335 F.3d 1373, 1381 (Fed. Cir. 2003) (“’A reply to an offer which purports to accept it but is

conditional on the offeror’s assent to terms additional to or different from those offered is not an

acceptance but is a counter-offer.’” (quoting Restatement (Second) of Contracts § 59 (1979)).

40The Court holds, accordingly, that, absent this language in the NORA, Silver State’s contract

rights would have arisen upon the government’s acceptance of Silver State’s bid. As explained

in more detail below, the effect of the NORA and the payment terms contained in BLM’s

Acceptance Letter served to delay Silver State’s contract rights, at most, only until Silver State

tendered the full bid price to the Agency.

41Pollock v. United States, 91 Ct. Cl. 257, 259 (1940) (“The contract between the parties is

comprised in an invitation for sealed bids for the purchase of certain condemned material

belonging to the United States Navy . . ., described in said invitation, and upon the terms and

conditions set out at length therein, and in plaintiffs’ written offer in response to certain

invitations for bids, and in the acceptance of such offer on behalf of the defendant by the supply

officer at the U. S. Naval Fuel Depot.”); see Levinson v. United States, 258 U.S. 198, 199-200 (1922)

(bid was offer and acceptance of second highest bid formed binding contract in spite of offeree’s

later attempt to rescind after discovering misplaced highest bid); Contracts-Auctions-Bid Received

at Public Sale Operates As Offer, 31 Yale L.J. 887, 888 (1922) (discussing Levinson and explaining

that “[a]n advertisement that the property will be sold at a public sale to the highest bidder is no

more than an invitation to submit bids or offers. . . . Hence a bid may be withdrawn at any time

before its acceptance, but when it is accepted a valid contract is created. . . . [,]” but noting that

“[a]n advertisement may be sufficiently explicit to constitute an offer”); United States v. Sabin

Metal Corp., 151 F. Supp. 683, 687 (S.D.N.Y. 1957) (citing Levinson for the proposition that “[t]he

defendant’s bid constituted the offer and the government’s acceptance completed the contract”

and holding that “[t]he fact that the government reserved the right to reject any or all offers did

within the NORA), Appx. A73-76; (2) Silver State’s offer submitted in compliance with

the NORA, Appx. A84-92; (3) BLM’s Acceptance Letter, Appx. A94-95; and (4) the

August 17, 2012 bilateral escrow instructions agreement and various written

amendments to those instructions, Appx. A96-97, A106-08, A162-64, A183-85. 42

Critically, neither party disputes that, as of November 28, 2012, the parties had a

valid land sale contract, with the only remaining contractual duty (of either party) being

BLM’s obligation to transfer the Property in question – via a land patent – to Silver

State. 43 Indeed, the government repeatedly concedes that the parties formed a valid

contract. See Mot. to Dismiss at 26 (“The Parties Had An Express Auction-Sale

Contract”); Def. Reply at 1 (“Silver State won the restricted auction, and the BLM and

Silver State ultimately agreed on a closing date…”); Tr. at 13:10-15 (“THE COURT:

Does the government agree that upon payment – the final payment of the full purchase

price, that at that point in time, there was a contract by Silver State with the United

States for the purchase of the land in question? MR. ROSENBERG: Yes.”). 44

Moreover, the government further agrees that, up until the Assistant Secretary

made the decision to refuse to transfer the Property, BLM had a contractual obligation

to convey the Property, via land patent, to Silver State. Tr. at 18:14-19 (“THE COURT: If

not prevent the creation of mutual obligations after it accepted the defendant’s offer.”), aff'd, 253

F.2d 956 (2d Cir. 1958); see also Wells Fargo Bank, N.A. v. United States, 88 F.3d 1012, 1019 (Fed.

Cir. 1996) (“That the government’s promise to issue the loan guarantee was contingent upon

High Plains and Wells Fargo’s performance of numerous conditions does not make the promise

any less binding. Indeed, the essence of a unilateral contract is that one party’s promise is

conditional upon the other party’s performance of certain acts and when the other party

performs, the first party is bound.”).

42See Def. Reply at 5-6 (“[T]he [NORA], Silver State’s sealed written bid, the BLM’s acceptance

decision, and the escrow instructions are contract documents that ‘supply’ relevant terms of the

agreement.”). Although the Court assumes for the purposes of resolving the government’s

motion that the entire NORA was included in the parties’ contract, the Court’s view is that the

NORA’s Terms and Conditions section was the only section of that document governing the

parties’ contractual obligations following Silver State’s tendering full payment of its promised

purchase price.

43See Def. Mot. at 1 (“Silver State performed its end of the transaction by timely making final

payment of the purchase price.”).

44 “’[A] lawyer's statements may constitute a binding admission of a party[ ]’ if the statements

are ‘deliberate, clear, and unambiguous[.]’” Minter v. Wells Fargo Bank, N.A., 762 F.3d 339, 347

(4th Cir. 2014) (quoting Fraternal Order of Police Lodge No. 89 v. Prince George's Cty., Md., 608 F.3d

183, 190 (4th Cir. 2010)); see Checo v. Shinseki, 748 F.3d 1373, 1378 n.5 (Fed. Cir. 2014)

(questioning the Veterans Court’s “reluctance to accept [a] concession” made at oral argument

and citing case law for the proposition that admissions are generally binding on the parties).

you had asked an official at BLM what is left to do under this now formed contract, the

answer is, the government’s duty under the contract . . . [i]s to convey the property.

MR. ROSENBERG: Correct.”). Nor could the government plausibly contend otherwise,

given that the Agency memorandum recommending that the Assistant Secretary

terminate the parties’ contract admitted that Silver State’s payment of the purchase

price balance into escrow “triggered the requirement that the BLM issue the patent

within 30 days, by December 28, 2012.” Appx. A190 (emphasis added).

As noted above, although the parties executed multiple written agreements to

extend the government’s deadline to issue the patent, not one of those bilateral

agreements ever rescinded the initial escrow term obligating the Agency to transmit the

land patent, or even suggested that the Agency had the power to terminate – or

otherwise was considering terminating – the contract. See Appx. A96 (agreement that,

upon timely payment, “BLM will then provide the patent . . .”); id. at A106-07, 162-63,

183-85.

“[A] breach of contract is a failure to perform a contractual duty when it is due.”

Trauma Serv. Grp., 104 F.3d at 1325. Silver State alleges that the parties’ contract

required the Agency to deliver the patent for the Property to Silver State by May 13,

2013 and that the Agency failed to perform this contractual duty. Compl. ¶¶ 43-44; see

Tr. at 95:13-14 (government asserting that “[t]here was no termination of the contract[,]”

but conceding that “[t]here was an order not to perform”).

Thus, the only questions that remain are whether, as the government argues, it

nevertheless may avoid Silver State’s claim for breach of contract, as a matter of law,

because: (1) the contract between the parties incorporated statutory or regulatory

provisions (or contained some other term) that permitted the Agency to decline to

convey the Property (or to otherwise cancel the parties’ land sale contract),

notwithstanding that Silver State fulfilled all of its contractual obligations; (2) judicial

findings in the prior APA litigation between the parties foreclose Silver State’s breach of

contract claim here; or (3) Silver State already has received a full refund of its bid price

paid to the government and cannot demonstrate entitlement to any further damages.

The Court rejects each of these arguments, as well as the other grounds for dismissal

that the government presents in its motion.

B. The Government Has Not Identified Any Contract Term Excusing The

Agency’s Performance Or Otherwise Permitting The Agency To Avoid

Liability For Breach Of Contract

The government’s primary contention in support of its motion to dismiss is that

“Silver State’s claims hinge on the [sic] whether the modified competitive sale . . . was

lawful on the sale’s closing date” – i.e., the date on which BLM was required to convey

the land patent for the Property to Silver State. Def. Reply at 9. In particular, the

government maintains that the contract at issue incorporated 43 U.S.C. § 1713(f).

According to the government, that statutory provision, when amalgamated with the

Secretary’s power in 43 U.S.C. § 1457 (and 43 U.S.C. § 2), gave the Agency the

contractual power (1) to reassess its decision to solicit offers utilizing modified

competitive bidding procedures at any point in time prior to conveying the patent for

the Property, and (2) to withhold the land patent from Silver State without breaching

the contract, even after Silver State completed payment, if the Agency determined that

modified competitive bidding procedures should not have been employed. Def. Reply

at 1, 12 (arguing that, “by making section [1713] a term of the auction sale contract, the

parties conditioned the BLM’s duty to deliver the patent on the Secretary’s final

judgment that the sale met the statute’s requirements”); Def. Mot. at 30 (“The Secretary

(acting through the Assistant Secretary) relied on [43 U.S.C. § 1457(4), (13)] to order the

cancellation of the unlawful sale to Silver State”); Tr. at 37:1-38:5 (referencing “Section 2

and Section 1457 of Title 43”). 45 The government’s argument all but completely hinges

on whether the parties incorporated 43 U.S.C. § 1713(f) into their contract. Tr. 37:12-15;

39:10-11; 90:2-12; 91:4-8.

The Court need not resolve the full metes-and-bounds of the parties’ contractual

undertakings or decide with surgical precision which sentences in the NORA or other

documents are included (or not) in the parties’ contract. Rather, as noted above, the

Court assumes here – for the purposes of resolving the government’s motion – that all

of the above-referenced documents constitute the contractual documents binding upon

the parties, and holds only that: (1) 43 U.S.C. § 1713(f) was not incorporated in the

parties’ contract as a contract term; (2) even if that statutory provision or its related

implementing regulations were considered contract terms, they cannot be interpreted to

excuse the government’s failure to transfer the Property; and (3) no other contract term

or other statutory or regulatory authority identified by the government at this stage of

the case permits the government to avoid contractual liability. 46

45Tr. at 18:14-19:10 (arguing that “the only way there’s no breach of contract is if there is a term

of the contract that exempts . . . the Government from conveying the property” and that the

term which so exempted the government here is 43 U.S.C. § 1713(f)).

46“When the performance of a duty under a contract is due, nonperformance of that duty is a

breach of the contract.” Century Expl. New Orleans, LLC v. United States, 110 Fed. Cl. 148, 163

(2013) (citing Restatement (Second) of Contracts § 235 (1981)), aff’d, 745 F.3d 1168 (Fed. Cir.

2014).

1. The Parties’ Contract Did Not Incorporate 43 U.S.C. § 1713(f)

As the government forthrightly concedes, “Silver State performed its end of the

transaction by timely making final payment of the purchase price.” Def. Mot. at 1. At

that point – and, as noted above, the government agrees – the only remaining

contractual duty belonged to the Agency (i.e., to convey the Property’s title to Silver

State via a land patent). Appx. A190; Tr. at 18:14-19 (“THE COURT: If you had asked

an official at BLM what is left to do under this now formed contract, the answer is, the

government’s duty under the contract . . . is to convey the property. MR. ROSENBERG:

Correct.”).

Nevertheless, the government asserts that it had the contractual power to not

convey the land patent for the Property to Silver State – and otherwise avoid liability for

breach of contract – based on 43 U.S.C. § 1713(f) because it was a term of the parties’

contract. Def. Mot. at 47; Tr. at 37:12-15 (“THE COURT: [D]oes the government’s case

here in terms of no breach hang on 1713(f) alone, or no? MR. ROSENBERG: Yes. It

does depend on 1713(f).”).

The Court rejects the government’s argument. Northrop Grumman Info. Tech., Inc.

v. United States, 535 F.3d 1339, 1343 (Fed. Cir. 2008) (whether a statute is incorporated

“by reference is a question of law”).

For a contract to incorporate a document or statutory provision, “the

incorporating contract must use language that is express and clear, so as to leave no

ambiguity about the identity of the document being referenced, nor any reasonable

doubt about the fact that the referenced document is being incorporated into the

contract.” Id. at 1344 (emphasis added); see also St. Christopher Assocs. v. United States,

511 F.3d 1376, 1384 (Fed. Cir. 2008) (holding that a general reference to the agency’s

regulations did not incorporate a specific regulation promulgated by the agency or a

specific section of the agency's handbook); Smithson v. United States, 847 F.2d 791, 794–

95 (Fed. Cir. 1988) (holding that a contract did not incorporate an agency’s regulations,

despite the statement in the contract that it was “subject to the present regulations of the

[agency] and to its future regulations not inconsistent with the express provisions

hereof”).

In St. Christopher Associates, the Federal Circuit explained that it is “reluctant to

find that statutory or regulatory provisions are incorporated into a contract with the

government unless the contract explicitly provides for their incorporation.” 511 F.3d at

1384 (discussing Smithson, 847 F.2d at 794). The Federal Circuit’s rationale, as

articulated in Smithson, is that wholesale incorporation of regulations into a contract

would allow a contracting party to “choose among a multitude of regulations as to

which he could claim a contract breach—and thus ‘[a] wholly new ground of obligation

would be summarily created by mere implication.’” 847 F.2d at 794 (quoting Eastport

S.S. Corp. v. United States, 372 F.2d 1002, 1010 (Ct. Cl. 1967)). The Federal Circuit’s

interpretive rule, in that respect, thus protects the government, as well as plaintiff

contractors.

Moreover, even a contract’s reference to a specific statutory provision will not

suffice to incorporate that provision into the contract. In that regard, the Federal Circuit

has made crystal clear that its:

cases support a principle in our Circuit that the language used

in a contract to incorporate extrinsic material by reference

must explicitly, or at least precisely, identify the written

material being incorporated and must clearly communicate that

the purpose of the reference is to incorporate the referenced material

into the contract (rather than merely to acknowledge that the

referenced material is relevant to the contract, e.g., as

background law or negotiating history).

Northrop Grumman Info. Tech., Inc., 535 F.3d at 1345 (emphasis added). In Southern

California Edison Co. v. United States, 226 F.3d 1349 (Fed. Cir. 2000), for example, “the

contracts-in-suit did incorporate the terms and conditions of certain regulations by

specifically referring to the regulations (the text of which was attached to the contract as

an exhibit) ‘as fully and completely as though set forth herein [i.e., in the contract] in

length[.]’” Northrop Grumman Info. Tech., Inc., 535 F.3d at 1344 (emphasis added)

(quoting 226 F.3d at 1353). 47

The Court finds that none of the documents – or provisions within those

documents – that comprise the parties’ contract at issue contains language that come

close to meeting the Federal Circuit’s standard for incorporation of 43 U.S.C. § 1713(f)

by reference.

The government points to the NORA, but it contains nothing more than a

passing reference to 43 U.S.C. § 1713 generally in the “Summary” section of the Federal

Register entry containing the NORA. Appx. A73 (77 Fed. Reg. at 20,413). In particular,

the “Summary” merely notes that “[t]he sale [not the contract] will be subject to the

applicable provisions of . . . 43 U.S.C. 1713, and BLM land sale regulations at 43 CFR

2710.” Id. Thus, even assuming that BLM intended to incorporate that “Summary”

47The government’s supplemental brief contains a passing reference to Smithson, 847 F.2d at

794, Def. Supp. Br. at 2, but does not otherwise address that case or subsequent Federal Circuit

cases squarely on point.

language into the parties’ resulting contract, the “Summary” recites mere “background

law” (regarding how BLM would invite offers), the very type of language that the

Federal Circuit in Northrop Grumman, 535 F.3d at 1345, held does not constitute

incorporation language. Such language is very far, indeed, from the type of

incorporation language the Federal Circuit approved in Southern California Edison, 226

F.3d at 1353. And, while the Federal Circuit “does not require ‘magic words’ of

reference or of incorporation,” the NORA’s language falls well-short of the “widely-

used and judicially-approved language of incorporation, such as ‘is hereby

incorporated by reference’ or ‘is hereby incorporated as though fully set forth herein,’”

which the Federal Circuit has recommended agencies adopt to “avoid or at least

minimize the risk of having to litigate this issue.” Northrop Grumman Info. Tech., Inc.,

535 F.3d at 1346.

Moreover, there is no reference – bare or otherwise – to 43 U.S.C. § 1713, let alone

specifically § 1713(f), elsewhere in the NORA. In particular, the NORA does not

reference 43 U.S.C. § 1713 in its “Terms and Conditions” section, which the Court views

as the only section of that document governing the parties’ contractual obligations

following Silver State’s tendering full payment of its promised purchase price.

In sum, the NORA does not “clearly communicate that the purpose of the

reference” to 43 U.S.C. § 1713 “is to incorporate the referenced material into [a resulting]

contract.” Id. at 1345. And there is nothing whatsoever in the NORA’s passing

reference to 43 U.S.C. § 1713 pointing specifically to § 1713(f) as an “applicable term”

that might govern the parties’ future performance obligations under the contract.

Although the bilateral August 17, 2012 escrow instructions also make a passing,

general reference to 43 U.S.C. § 1713 (but not specifically to 43 U.S.C. § 1713(f)) – and

albeit mistakenly citing to § 171648 – that document likewise does not contain any

language remotely approaching the type of explicit incorporation phraseology

approved by the Federal Circuit in Southern California Edison. The Court, again, is

cognizant that no “magic words” are required per se, Northrop Grumman Info. Tech., Inc.,

535 F.3d at 1346, but the escrow instruction document includes the relevant statute as

part of what amounts to “background language,” noting simply that “[t]he following

instructions are prepared for use in processing a land patent through escrow . . .

pursuant to [43 U.S.C. § 1713].” Appx. A96. The document does not specifically

48See Tr. at 32:9-16 (“THE COURT: . . . . the escrow instructions . . . miscite[] the code provision

of 1716. MR. ROSENBERG: It does. THE COURT: It should be 1713. MR. ROSENBERG:

Correct.”).

identify 43 U.S.C. § 1713(f) as a term governing the parties’ future rights or performance

obligations under the contract.

In any event, the paragraph in the escrow instructions referencing the statute

strongly undermines the government’s position. In that bilateral agreement – that the

parties concur is included in the resulting land sale contract – the parties specifically

agreed that “[t]he transaction is found to be in the public interest and otherwise in

conformance with the laws and regulations.” Appx. A96. Given that the parties also

agreed that “[a]ny changes to these instructions must be in writing and signed by the

[sic] all the parties named below[,]” the government would have to explain how the

bare reference to § 1713 generally reserved to the Agency a unilateral contract right

sufficient to (1) override the parties’ agreed-upon finding regarding the transaction’s

“conformance with [applicable] laws and regulations,” (2) revisit the previous BLM

determination that modified competitive bidding procedures were appropriate, and (3)

refuse to convey the land patent to Silver State, while avoiding contract liability. Id.

The government, however – aside from insinuating that the parties’ joint finding was

premature – makes no real effort to reconcile the sentence referencing the statute, the

parties’ contractual finding regarding the legality of the transaction, and the

government’s subsequent invocation of the statute to attempt to avoid liability for

breach of contract. 49

The government, in its motion to dismiss, even relies upon the legality finding in

the escrow instructions, but fails to acknowledge that the escrow instructions were

executed by both parties, formed part of the parties’ contract at issue, and could only be

amended by further agreement in writing. See Def. Mot. at 49 (quoting Appx. A96).

The government asserts that “[t]he escrow instructions . . . confirm the parties’

agreement that only a lawful sale would be consummated,” and “that the lawfulness of

the sale was reviewable after the modified competitive sale had been initially

authorized,” id., but the escrow instructions contain no such language at all. Again, the

government ignores: (1) that the land sale already had been completed; (2) the only

explicit contract language is the parties’ agreement regarding the lawfulness of the

49See Def. Supp. Br. at 2; Tr. at 33:14-17 (“MR. ROSENBERG: Well, these escrow instructions

were executed before the change in circumstances that rendered the sale to be out of compliance

with Section 1713(f).”); id. at 34:11-21 (“THE COURT: So the government's contention is that the

invocation of 1713(f) . . . beats, in some sense, [the contractual finding that the sale was lawful]?

[The government] has to. MR. ROSENBERG: Yes, but those are not inconsistent. They're not

inconsistent. So[,] the change in circumstances that rendered the sale to be out of compliance

with 1713(f) happened months after this recital about the sale being found to be in the public

interest and otherwise in conformance with the laws and regulations.”).

transaction; and (3) the government’s decision to refuse to issue the land patent

occurred after Silver State tendered the full contract price.

The government might well have contended – and perhaps the Court could have

been persuaded to agree – that the legality-and-public-interest finding itself constitutes

nothing more than unenforceable preamble language. Lurline Gardens Ltd. Hous. P’ship

v. United States, 37 Fed. Cl. 415, 420 n.7 (1997) (“A recital that an agreement is governed

by or executed pursuant to a set of regulations does not incorporate those regulations

into the agreement.” (internal citations omitted)). But, the legality-and-public-interest

finding is in the same paragraph as the statutory citation. The government cannot have

its cake and eat it too, reading some parts of the relevant escrow agreement paragraph

into the parties’ contract, and other parts out.

In any event, the government somewhat incredibly urges dismissal of Silver

State’s suit based on a later, unilateral determination of the Agency under

43 U.S.C. § 1713(f), notwithstanding the government’s concession that the finding of

legality was part of the parties’ signed contract. Tr. 33:25-34:10 (“THE COURT: The

secretary agrees in [the] contract that the transaction is in the public interest and in

conformance with the law. MR. ROSENBERG: That’s right.”). The contract did not

provide the Agency with such power.

The government, in its supplemental brief, relies upon the United States

Supreme Court’s decision in Mobil Oil Expl. & Producing Southeast, Inc. v. United States,

530 U.S. 604, 614 (2000), for the proposition that “language making an agreement

‘subject to’ a specific statutory or regulatory provision suffices to incorporate that

provision into the contract.” Def. Supp. Br. at 2. The Supreme Court, however, held no

such thing; and, indeed, nothing in the Federal Circuit’s subsequent jurisprudence

suggests such a reading of Mobil Oil. See Northrop Grumman Info. Tech., Inc.,

535 F.3d at 1344 (discussing incorporation precedent and citing Smithson, 847 F.2d 791,

with approval, for the proposition that a clause which provided that the “agreement is

subject to the present regulations . . . is hardly the type of clause that should be read as

incorporating fully into the contract all the [agency] regulations”). In that regard, the

government’s supporting parenthetical quotation from Mobil Oil omits a critical part of

the Supreme Court’s summary, specifically the emphasized part of this quote: “The

Government does not deny that the contracts, made ‘pursuant to’ and ‘subject to’ [the

Outer Continental Shelf Lands Act (OCSLA)], incorporated OCSLA provisions as

promises.” 530 U.S. at 614 (emphasis added).

Thus, in Mobil Oil, and contrary to the government’s suggestion, the Supreme

Court did not hold that “pursuant to” and “subject to” are sufficient phrases, in and of

themselves, to trigger a statute’s incorporation into a contract by reference. Rather, the

question of incorporation by reference simply was not contested in the Mobil Oil

litigation. Indeed, the trial court’s decision in that case demonstrates that there was a

great deal of additional contract language supporting incorporation by reference of the

statute at issue, thus making it hardly surprising that the parties in that case did not

litigate the issue. See Conoco Inc. v. United States, 35 Fed. Cl. 309, 318 (1996) (“In regard

to performance, Sec. 10 of the leases contain[s] a provision requiring that the lessees

comply with all regulations and orders relating to exploration, development and

production. The lease terms also contain a provision in Sec. 13 stating, ‘The Lessor may

suspend or cancel this lease pursuant to Section 5 of the [OCSLA] and compensation

shall be paid when provided by the Act.’”). 50

Further still, the NORA does not make the parties’ resulting contract “subject to”

43 U.S.C. § 1713(f); rather, the “Summary” section of the NORA merely provides that

“[t]he sale will be subject to the applicable provisions of Sections 203 of the [FLPMA]

and BLM land sale regulations at 43 CFR 2710.” Appx. A73 (emphasis added). And, as

explained above, the NORA itself contemplated that the “sale” concludes when the

Agency receives bids – and, at the latest, upon BLM’s acceptance of a bid – pursuant to

the modified competitive sealed-bid process. Id. at A74 (“Within 30 days of the sale, the

BLM will, in writing either accept or reject all bids received.” (emphasis added)); see also

43 C.F.R. 2711.1-2 (providing that a “[NORA] offering for sale a tract or tracts of public

lands identified for disposal by sale shall be issued, published and sent to parties of

interest by the authorized officer not less than 60 days prior to the sale” (emphasis

added)). The Court need not decide the precise meaning of “sale” in the context of the

NORA; it is sufficient that “sale” clearly means something different from – and occurs

earlier than – “consummation” or “conveyance.” See Imation Corp. v. Koninklijke Philips

Elecs. N.V., 586 F.3d 980, 990 (Fed. Cir. 2009) (“A proper interpretation of a contract

generally assumes consistent usage of terms throughout the Agreement.”); Advanced

Commc'n Design, Inc. v. Premier Retail Networks, Inc., 46 F. App'x 964, 980–81 (Fed. Cir.

2002) (“This contention has some force, as it appeals to the maxim that the construction

50The government also cites Pub. Hous. Authorities Directors Ass'n v. United States, 130 Fed. Cl.

522 (2017). See Def. Supp. Br. at 2. That decision does not support the government’s position.

To the contrary, that case involved a contract that expressly incorporated regulations as

contractual obligations, employing just the type of incorporation language the Federal Circuit

has approved. 130 Fed. Cl. at 532 (“Thus, section 5 of the [agreements] specifies that the parties

must comply with the regulations ‘promulgated by HUD at Title 24 of the Code of Federal

Regulations, which are hereby incorporated into this [agreement] by reference as if fully set

forth herein, and as such regulations shall be amended from time to time.’” (emphasis in

original)).

of any legal document—like a statute, contract or patent—should try to give meaning to

every term in that document; otherwise, a lawyer or court will have erred by reading

the chosen words of the document into oblivion.”); Harris v. Dep't of Veterans Affairs, 142

F.3d 1463, 1467 (Fed.Cir.1998) (“We give the words of the agreement their ordinary

meaning unless the parties mutually intended and agreed to an alternative meaning.”);

Hunt Const. Grp., Inc. v. United States, 281 F.3d 1369, 1372 (Fed. Cir. 2002) (“The contract

must be considered as a whole and interpreted to effectuate its spirit and purpose,

giving reasonable meaning to all parts.”); McAbee Const. Inc. v. United States, 97 F.3d

1431, 1435 (Fed. Cir. 1996) (rejecting contract interpretation that “strips the provision of

its plain meaning”).

In sum, the Federal Circuit’s binding rule regarding incorporation by reference is

straightforward:

To incorporate material by reference, a contract must use clear

and express language of incorporation, which unambiguously

communicates that the purpose is to incorporate the referenced

material, rather than merely acknowledge that the referenced

material is relevant to the contract.

Precision Pine & Timber, Inc. v. United States, 596 F.3d 817, 826 (Fed. Cir. 2010) (emphasis

added). No contractual document at issue here contains the type of “clear and express

language of incorporation” that “unambiguously communicates” that the parties

intended to incorporate 43 U.S.C. § 1713(f) into their contract.

Accordingly, the Court rejects the government’s argument that the parties

incorporated 43 U.S.C. § 1713(f) into their contract, such that the government could

invoke that provision to unilaterally terminate Silver State’s contract without

contractual liability.

2. 43 U.S.C. § 1713(f) Was Not an Implied Term of the Parties’

Contract

The Court rejects not only the government’s argument that “[t]he parties

expressly manifested their intent to condition the BLM’s delivery of the patent on a

favorable ‘necessary and proper’ determination[,]” Def. Mot. at 47 (emphasis added),

but also the government’s assertion, in the alternative, that a condition precedent to

performance by a party may be implied. Id. (“The ‘intention to make a duty conditional

may be manifested by the general nature of [the] agreement’ itself.” (quoting

Restatement (Second) of Contracts § 226 cmt. a) (alteration in original)). Notably, the

government cites no decision – from this Court,51 the Federal Circuit, or any other court

for that matter – supporting its argument that a condition precedent should be implied

based on the “general nature” of the parties’ agreement.

This Court will not extract by implication from the parties’ written agreement a

condition precedent untethered to any of the contract’s terms. 52

Silver State observes that the NORA included a provision in the “Terms and

Conditions” section indicating that “[t]he conveyance of this parcel will not be on a

contingency basis.” Appx. A75; Compl. ¶ 13. The government asserts that “this

phrase” – referred to herein as the “no contingency” language – “plainly concerns a

transfer of ownership made contingent upon . . . potential future uses of the land.” Def.

Mot. at 48 (emphasis in original). The government further argues that Silver State

cannot reasonably construe that phrase “to impair the Secretary’s statutory duty

[pursuant to 43 U.S.C. § 1713(f)], embodied in the contract.” Id. at 49. Although for the

purposes of resolving the government’s motion this Court does not definitively

interpret the “no contingency” language here, the government gives Silver State’s

invocation of that phrase very short shrift, see id. at 48-49, merely begging the question

whether 43 U.S.C. § 1713(f), in fact, is “embodied in the contract” – a premise this Court

already has rejected. Id. Moreover, even if the contract at issue had incorporated that

statutory provision, there is another, more plausible interpretation. In particular,

§ 1713(f) cannot be read – in light of the “no contingency” language – to provide BLM

with a post-contract formation reservation of rights to revisit and effectively nullify the

Agency’s earlier, legally valid decision to enter into a contract with Silver State via

modified competitive bidding.

Were this Court to read the parties’ contract as containing an implied condition

precedent – in the form of the Agency’s power to engage in a post-contract formation

“necessary and proper” (re-)determination – the Court effectively would be holding

that the MPA itself constituted a term of the NORA and the parties’ resulting contract.

See Def. Reply at 16 (asserting “the land sale’s complete dependence on the existence of

the MPA itself”). That certainly seems to have been BLM’s effective assumption as

51This Court was able to locate only one decision even referencing that putative rule. See Korea

Dev. Corp. v. United States, 9 Cl. Ct. 167, 176 (1985) (quoting 2 Restatement of Contracts, Second,

§ 226 (1981), but noting that “the contract language itself . . . spells out the condition

precedent”).

52For the reasons explained infra, Section III.B.3., the Court rejects the government’s suggested

textual hook – the lone word “sale” – underpinning the assertion that BLM had a continuing

contractual right to revisit its decision to engage in a modified competitive bidding process until

issuance of the land patent.

articulated in its Recommendation Memorandum. Appx. A193 (“[E]ven though the

modified competitive bidding procedures did not guarantee that Silver State was going

to be the successful purchaser for the parcel, but for the now-terminated Development

Agreement [i.e., the MPA] and the parties’ representations about that Agreement and

their relationship, the BLM would not have agreed to utilize a modified competitive

process in the first place.”). 53

The fatal flaw in the government’s position is that the reason the MPA was not

incorporated into the parties’ contract is that the NORA provided for a modified

competitive bidding process, contemplating that bidders other than Silver State could

purchase the land. If the Court accepts, as it must, the presumption that BLM was

acting in good faith, 54 the Agency by definition recognized the possibility that a bidder

other than Silver State could have been selected as the high-bidder and thus form a

contract with BLM for the Property. That being the case, the Court finds it difficult to

understand how the MPA could have been so critical to the parties’ contract, when no

other potential purchaser would have been bound by the MPA pursuant to the NORA.

Moreover, had the Agency wanted to reserve to itself the right to cancel the

parties’ agreement without liability, the Agency well knows how to write such a

NORA. In Notice of Realty Action: Non-Competitive Sale in the Las Vegas Valley, NV,

71 Fed. Reg. 74,554-03 (Dec. 12, 2006), 55 BLM proposed to sell a “parcel under direct sale

procedures in accordance with the applicable provisions of the [FLPMA].” 71 Fed. Reg.

at 74,555 (noting that “the direct sale method is supported by 43 CFR 2711.3-3(1)”). 56 In

53The Court notes that BLM, in its recommendation memorandum, raised questions about

Silver State’s “veracity” – with respect to its “initial representations about the Development

Agreement” – “[s]ubsequent to the completion of the sale process.” Appx. A193 (emphasis added).

54“The presumption that government officials act in good faith is enshrined in our

jurisprudence.” Croman Corp. v. United States, 724 F.3d 1357, 1364 (Fed. Cir. 2013).

55 The Court takes judicial notice of this Notice of Realty Action “because it is a government

record published in a reliable source, the Federal Register.” Fairholme Funds, Inc. v. United

States, 147 Fed. Cl. 1, 21 n.6 (2019) (citing Murakami v. United States, 46 Fed. Cl. 731, 739 (2000),

aff'd, 398 F.3d 1342, 1354-55 (Fed. Cir. 2005); Democracy Forward Found. v. White House Office of

Am. Innovation, 356 F. Supp. 3d 61, 62 n.2 (D.D.C. 2019); Fed. R. Evid. 201). “Although a motion

to dismiss is normally limited to the allegations in a complaint, the court may consider facts

derived from sources subject to judicial notice without converting the motion into one for

summary judgment.” Fairholme Funds, Inc., 147 Fed. Cl. at 21 n.6 (citing Sebastian v. United

States, 185 F.3d 1368, 1374 (Fed. Cir. 1999)).

56Appx. A26-27 (BLM rejecting Henderson’s request that BLM utilize direct sale procedures).

The distinction between direct sale and modified competitive bidding is immaterial for the

Court’s point, which is that BLM knows how to build in contingencies to its NORAs but

declined to take the necessary steps here.

particular, BLM “proposed to [sell land] to Clark County for affordable housing

purposes.” Id. Significantly, that NORA omitted the “no contingency” language Silver

State cites in its Complaint, and expressly provided for a number of “terms, covenants,

and conditions” restricting Clark County’s use of the land following the sale, as follows:

2. Clark County hereby covenants and binds all successors-

in-interests to use the land conveyed only for affordable

housing purposes for a period of fifteen (15) years . . . . This

affordable housing covenant shall be deemed appurtenant to

and to run with the ownership of the land conveyed. It shall

be binding upon Clark County, its successors and assigns,

during the time each owns the land.

3. If, at the end of five (5) years from the date of the sale

Patent, any land conveyed through this proposed sale is not

being used for affordable housing purposes, at the option of

the United States, those lands not so used shall revert to the

United States, or, in the alternative, the United States may

require payment by the owner to the United States of the then

fair market value.

4. All land conveyed shall be used only for affordable

housing purposes during the period of affordability. If at any

time all or any portion of the land conveyed is used for any

purpose other than affordable housing purposes by Clark

County, or any successor-in-interest, at the option of the

United States, those lands not used for affordable housing

purposes shall revert to the United States . . . .

5. This use restriction and the reversionary interest may be

enforced by the BLM[.]

Id.

Completely putting aside the significance of the “no contingency” language BLM

omitted from the “direct sale” NORA summarized above, BLM quite clearly knows

how to – and does – employ express language in its land sale auctions and the resulting

contracts to make the promised conveyance contingent on particular usage of the sold

land. In Silver State’s case, Henderson even requested a direct sale. Appx. A22. BLM,

however, declined to engage in that type of sales process or transaction, declined to

include any express contingency, and, in particular, made no attempt to subject Silver

State’s bid or the Agency’s resulting acceptance to any particular post-purchase usage

requirement. Accordingly, the Court similarly declines to read such language into the

parties’ agreement or to otherwise infer a condition precedent that was not met. 57

3. Even Assuming 43 U.S.C. § 1713(f) Or Its Implementing

Regulations Were Incorporated In The Parties’ Contract, The

Government Did Not Have The Contractual Right To Terminate

The Land Sale Contract At Issue

Even assuming that the parties’ contract incorporated 43 U.S.C. § 1713(f) or its

implementing regulations as contract terms, nothing in the plain language of

43 U.S.C. § 1713 or its implementing regulations – even broadly construed – supports

the government’s position here. See Robinson v. Shell Oil Co., 519 U.S. 337, 340 (1997)

(“Our first step in interpreting a statute is to determine whether the language at issue

has a plain and unambiguous meaning with regard to the particular dispute in the case.

Our inquiry must cease if the statutory language is unambiguous and ‘the statutory

scheme is coherent and consistent.’” (quoting United States v. Ron Pair Enters., Inc., 489

U.S. 235, 240 (1989)); Sunoco, Inc. v. United States, 908 F.3d 710, 715 (Fed. Cir. 2018)

(“When the words of a statute are unambiguous, then, this first canon is also the last.”

(quoting Conn. Nat’l Bank v. Germain, 503 U.S. 249, 254 (1992)), cert. denied, 140 S. Ct. 46

(2019)).

First, as a general matter, the Court views 43 U.S.C. § 1713 as directing the

Agency’s conduct in the land sale process, as the NORA itself suggests, but absolutely

nothing in the statute’s plain language provides any terms akin to a post-bid acceptance

contract clause. Nor can that statutory provision plausibly be read to confer post-

contract formation rights on either party, and certainly not termination rights in favor of

the government after the Agency has accepted a bidder’s offer pursuant to the

procedures that the Agency selected and after that bidder has tendered the full price, as

Silver State did in this case. Cf. Technitrol, Inc. v. United States, 440 F.2d 1362, 1374 (Ct.

Cl. 1971) (discussing a patent and noting that “[t]he clause, as worded here, does not

purport to extend its reach chronologically, by mortmain, into the indefinite future.”).

The government agrees that the “FLPMA does not prescribe any clauses for

inclusion in authorized land-sale contracts[,]” but argues that the “FLPMA simply

defines the Secretary’s statutory authority to dispose of Federal public lands, including

the conditions that must be met and the procedures that must be followed before selling

57If anything, this would appear to be a case of seller’s remorse. Appx. A193 (admitting that the

Agency was not revisiting or revising its “necessary and proper” decision, per se, so much as

concluding that “[a]bsent Silver State’s and Henderson’s representations [about the MPA], the

BLM would have likely sold the nominated parcel” via a different process (emphasis added)).

land out of Government control.” Def. Supp. Br. at 3-4 (emphasis added). The Court

agrees in-part and disagrees in-part. The government is correct that the statute defines

the Agency’s statutory authority to sell Federal land. The Court further agrees that

certain procedures must be followed “before selling” such land. Id. The Court holds,

however, that the government’s critical error is with regard to whether a “sale” already

had occurred when the government finally repudiated its contractual obligation to issue

the land patent to Silver State. As the Court’s decision demonstrates, the sale at issue

was complete – and the parties had formed a contract – long before the government

repudiated the contract. 58

Second, § 1713(f), in particular, provides only that the Agency shall conduct

“[s]ales of public lands under this section” using “competitive bidding procedures”

unless the Secretary “determines it necessary and proper” to sell “lands with modified

competitive bidding or without competitive bidding.” 43 U.S.C. § 1713(f). Contrary to

the government’s proposed interpretation of that provision, § 1713(f) only requires a

“necessary and proper” decision prior to initiating the sale process via the NORA; there

is no language even hinting at the Agency’s power to revisit and undo its decision to

engage in modified competitive bidding after (1) the Agency already has accepted a bid

and (2) the winning bidder has paid the full purchase price.

The government agrees that “[t]his ‘necessary and proper’ determination must

be made by the BLM before holding a modified competitive auction,” but maintains

that such a determination “may be revisited and reversed by the Secretary at any time

before the patent issues.” Def. Mot. at 6. The government, however, points to no

operative statutory language whatsoever supporting its expansive reading, aside from

relying on § 1713(f)’s reference to a single word – “sales.” Def. Mot. at 46 n.13. The

government’s view is thus: “sale” means every action up to and including BLM

58Significantly, this holding is entirely consistent with the central holding of the district court

and circuit court in the APA litigation that the Agency retained the power and acted reasonably

– under various statutory and regulatory authorities – to refuse to transfer the patent. See, infra,

Section IV. In other words, whether a court may order the Agency to transfer the Property “out

of Government control” is a question that is separate and distinct from the issue of whether the

government was contractually obligated to do so, and must therefore pay breach damages for

failing to do so. Notably, while the district court had the power to issue an injunction to order

the Agency to comply with the law – were it found to be in violation – neither this Court nor the

district court has the power to order specific performance of the contract itself, while only this

Court has the power to award contract damages. Kanemoto v. Reno, 41 F.3d 641, 644–45 (Fed.

Cir. 1994) (“The remedies available in [the Court of Federal Claims] extend only to those

affording monetary relief; the court cannot entertain claims for injunctive relief or specific

performance, except in narrowly defined, statutorily provided circumstances not here

pertinent.”).

conveying the land patent to the purchaser, and § 1713(f)’s directive that the Secretary

“may sell . . . land[] with modified competitive bidding” where the Secretary

“determines it necessary and proper” means that the Secretary may revisit that

determination at any point prior to transfer of the land patent. That lone word “sale,”

however, does not secretly encode an escape hatch for the Agency, at least not as

defined in the context of the statute, the regulations, the NORA, or the other documents

upon which the government itself has relied here. To the contrary, BLM repeatedly

refers to the NORA itself as the “proposed sale” and to the Agency’s acceptance of a

sealed-bid as constituting “the sale”:

• “The successful bidder will be allowed 180 calendar days from the date of

the sale to submit the remainder of the full purchase price.” Appx. A74

(emphasis added).

• “Within 30 days of the sale, the BLM will, in writing, either accept or reject

all bid received.” Id. (emphasis added).

• “No contractual or other rights against the United States may accrue

until the BLM officially accepts the offer to purchase, and the full bid

price is submitted by the 180th day following the sale.” Appx. A75

(emphasis added).

• “The remainder of the full bid price for the parcel must be received no

later than 4:30 p.m., Pacific Time, within 180 days following the day of the

sale.” Id. (emphasis added).

The NORA also refers to when lands are “[c]onveyed out of Federal ownership,” thus

making a clear distinction between the date of sale and the conveyance. Id. at A76; see

also Tr. at 26:1-4 (government conceding that 43 U.S.C. § 1713(f) does not use the phrase

“consummation of sale”).

Accordingly, while the government focuses on the definition of “sale” in

isolation, its argument ignores that parties may enter into a contract for sale that results,

ultimately, in a conveyance. In that regard, the need for a conveyance presumes the

existence of a prior agreement or sale. See, e.g., Conveyance, Black’s Law Dictionary

(11th ed. 2019) (“The transfer of a property right that does not pass by delivery of a

thing or merely by agreement.”); Contract, Black’s Law Dictionary (11th ed. 2019)

(defining the term to include a “[a] contract to sell goods at a future time”); Lavi v.

Pelican Inv. Corp., 36 F. App’x 923, 924 (9th Cir. 2002) (holding that a particular

“document operate[d] as an agreement to transfer the property in the future rather than

an immediate conveyance”).

Third, BLM’s own contemporaneous documents support Silver State’s position

here. BLM’s June 12, 2012 Acceptance Letter refers to June 4, 2012, when BLM opened

and considered bids, as “the sale date.” Appx. A95. Moreover, even the

Recommendation Memorandum to the Assistant Secretary – in which BLM officials first

recommended that the Agency “not issue the patent to Silver State” – refers to the date

of bid acceptance (June 12, 2012) as “following a modified competitive sale.” Id. at A189

(emphasis added). If that was not sufficiently clear contemporaneous evidence of the

Agency’s views, the Recommendation Memorandum explicitly recounts that “the

parcel was sold using a modified competitive process.” Id. (emphasis added); see id. at

A190 (“The modified competitive sale was held on June 4, 2012.”); id. at A193 (noting

that the government declined to transfer the land patent “[s]ubsequent to the completion of

the sale process” (emphasis added)); see also Reliable Contracting Grp., LLC v. Dep't of

Veterans Affairs, 779 F.3d 1329, 1332 (Fed. Cir. 2015) (“Generally, evidence of

contemporaneous beliefs about the contract is particularly probative of the meaning of a

contract.”); Blinderman Constr. Co. v. United States, 695 F.2d 552, 558 (Fed. Cir. 1982) (“It

is a familiar principle of contract law that the parties' contemporaneous construction of

an agreement, before it has become the subject of a dispute, is entitled to great weight in

its interpretation.”). 59

59A thought experiment is warranted here. The Agency issued its final decision, declining to

transfer the land patent to Silver State – and purporting to cancel the parties’ transaction – on

May 10, 2013, just three days prior to the revised, contractually agreed-upon due date for land

patent delivery of May 13, 2013. Compare Appx. A195, with id. at A183. If the Agency had

issued its final decision after the May 13, 2013 land patent due date, would the government now

admit its breach of contract? According to the government’s position thus far, the answer to

that question must be “no,” given the government’s assertion that the Agency reserved a right

to revisit its decision to sell the land, and thus to cancel the sale without liability, all the way up

until the Agency provided the land patent to Silver State. If that is the case, however, was there

ever a true contractual deadline – be it May 13, 2013, or any other – by which date the contract

required BLM to provide the land patent to Silver State? If the answer to that question is also

“no,” this Court would have to conclude that the parties’ putative contract was illusory. That is

something this Court will not do, based on the law as explained above, as well as the record

evidence the government included with its motion. See Hernandez v. Dep’t of Def., 325 F. App’x

905, 908 (Fed. Cir. 2009) (declining to construe a “settlement agreement as giving the agency the

option not to” perform because such an interpretation “would come close to rendering the

settlement agreement illusory[,]” and holding that “[s]uch a construction is disfavored”).

Alternatively, if the government concurs that May 13, 2013 constituted a hard deadline for BLM

to provide Silver State with the land patent, where is the contractual language providing a

limiting principle that the Agency may cancel the transaction without liability, but only until

May 13, 2013? Would not the power to entirely cancel the transaction before May 13, 2013

necessarily imply the lesser power to delay the conveyance until after that date if the “necessary

and proper” determination remained under review? And if that is the case, how could the

government agree, to begin with, that May 13, 2013 constituted an enforceable deadline? In

short, the government’s interpretive approach yields more questions than it answers.

Fourth, the regulation governing BLM’s issuance of the NORA further confirms

the Court’s interpretation that the “sale” here occurred as early as the date upon which

BLM opened the sealed bids, June 4, 2012, and certainly no later than bid acceptance on

June 12, 2012, or Silver State’s final payment on November 28, 2012. See

43 C.F.R. § 2711.1-2(a) (providing that a “[NORA] offering for sale a tract or tracts of

public lands identified for disposal by sale shall be issued, published and sent to parties

of interest by the authorized officer not less than 60 days prior to the sale.” (emphasis

added)).

If the term “sale” in 43 U.S.C. § 1713(f) were meant to include the entire period

up to BLM’s conveyance of the Property, the implementing regulation would make no

sense because a successful bidder has 180 days from bid opening to submit full

payment. But, if the government were correct, and “sale” includes the entire period up

to conveyance, BLM could have issued the NORA after bid opening and acceptance; of

course, that is nonsensical. Clearly, the date of “sale” is the date of bid opening, and the

NORA must be issued at least 60 days prior to that date, while the successful bidder

must submit full payment no later than 180 days subsequent to that date.

The government’s attempt to define “sale” in isolation, divorced from the entire

context of the record – including the operative statutes and regulations – must be

rejected. Sunoco, Inc., 908 F.3d at 715 (“Whether the statutory language is unambiguous

is determined by the text itself, the context in which the language is used, and the

statutory scheme as a whole.”), cert. denied, 140 S. Ct. 46 (2019); Vazquez-Claudio v.

Shinseki, 713 F.3d 112, 115 (Fed. Cir. 2013) (“In construing regulatory language, we must

read the disputed language in the context of the entire regulation as well as other

related regulatory sections in order to determine the language's plain meaning.”).

If anything, 43 U.S.C. § 1713(f), its implementing regulations, and the NORA all

support the Court’s view that the parties entered a binding contract for the sale of the

Property, at the latest, when Silver State tendered the full purchase price on November

28, 2012. In that regard, the statute expressly limited the Agency’s options following

the receipt of sealed-bids. The Agency may “accept[] or reject[]” . . . any offer to

purchase” the land so long as it is “[1] in writing [and] . . . [2] no later than thirty days

after the receipt of such offer . . . unless the offeror waives his right to a decision within

such thirty-day period.” 43 U.S.C. § 1713(g) (emphasis added). “Prior to the

expiration” of that 30-day period, “the authorized [Agency] officer” may even:

refuse to accept any offer or may withdraw any tract from sale if

he determines that: (1) Consummation of the sale would be

inconsistent with the provisions of any existing law; or (2)

Collusive or other activities have hindered or restrained free

and open bidding; or (3) Consummation of the sale would

encourage or promote speculation in public lands.

43 C.F.R. § 2711.3-1(f) (emphasis added). 60 Thus, the implementing regulation 61 covers

the precise case that the Agency asserted with respect to Silver State – i.e., where the

“[c]onsummation of the sale would be inconsistent with . . . law” – and yet the

government contends that there is no time limit cabining its power to terminate a

contract for purchase of the Property. Under the government’s view of those provisions

and the contract at issue – that the Agency somehow possessed a superseding power to

terminate the transaction without liability at any time up to conveyance – the 30-day

time limit is rendered entirely superfluous. Put differently, the government fails to

explain why the statute, regulation, and NORA would require the Agency to make a

decision on particular bids – or the sale in general – “no later than 30 days after receipt”

of offers, if a bid’s acceptance can always effectively be revoked at a later date where the

Agency changes its view of the transaction. Those provisions “would be meaningless

had [the regulations] simultaneously achieved the same end with silence.” Maine Cmty.

Health Options v. United States, __ U.S. __, 2020 WL 1978706, at *10 (U.S. Apr. 27, 2020).

Such an interpretation cannot be squared with the fundamental principle “of contract

interpretation . . . that no contract provision is made inconsistent, superfluous, or

redundant.” Lockheed Martin IR Imaging Sys., Inc., 108 F.3d at 322 (citing cases).

The text of the FLPMA’s implementing regulation confirms the Court’s reading

of § 1713(f). Although the government relies upon 43 C.F.R. § 2711.3-2 to argue that the

Agency was permitted to revisit its decision to engage in modified competitive bidding

at any time prior to conveyance, see, e.g., Def. Mot. at 46, 49, the text of that provision

weighs against the government’s interpretation of § 1713(f). In particular, § 2711.3-2(a)

provides that “[p]ublic lands may be offered [by BLM] for sale utilizing modified

competitive bidding procedures when the authorized officer determines it is necessary

60As detailed above, this language – or virtually identical language – was included in the

NORA. See, e.g., Appx. A74 (“Within 30 days of the sale, the BLM will, in writing, either accept

or reject all bids received.”).

61Admittedly the implementing regulations – in terms of the incorporation issue – present a

closer call given the repeated references to them in the NORA. Appx. A74 (citing

43 C.F.R. §§ 2711.3-1(f), (g), 2711.3-2(a), (a)(1)(i), (c) in the “Supplementary Information”

section); Appx. A75 (citing 43 C.F.R. § 2711.3-1(d)); Appx. A76 (citing 43 C.F.R. § 2711.3-1(f)).

But, similar to the statute itself, those regulatory provisions cover only “Procedures for Sale,”

and do not by their terms create any post-bid acceptance contractual rights or obligations in

favor of either party. See 43 C.F.R. § 2711.3 (Procedures for Sale). Had Silver State taken

exception in its bid to those regulatory sale procedures specified in the NORA, the bid may

have been invalid – i.e., in light of governing sealed-bid or auction law – but that does not mean

the regulatory provisions yield post-contract formation rights.

in order to assure equitable distribution of land among purchasers or to recognize

equitable considerations or public policies.” 43 C.F.R. § 2711.3-2(a) (emphasis added).

Thus, the “‘necessary and proper’ determination” – as the government calls it, see Def.

Mot. at 46 – was a condition precedent only to BLM’s decision to “offer[]” the Property

for sale, which occurred when the Agency issued the NORA. And, § 2711.3-2(a), by its

terms, only applies prior to, and perhaps while, the NORA is pending. Once the

government’s IFB ripens into a contract – at the latest following bid acceptance and the

bidder’s final payment – the “offer [of] sale” is no longer operative, and there is no

predicate for the government to reconsider its chosen method of sale.

Indeed, the Agency’s NORA further confirms that, even if the parties’ contract

had incorporated 43 U.S.C. § 1713(f) or its implementing regulations, such terms would

not have provided the Agency with the authority to revisit its decision to utilize

modified competitive bidding procedures at any point before patent issuance (i.e., after

the parties entered into the contract). In particular, the NORA provided that

“[i]nterested parties may submit written comments regarding the proposed

sale . . . until May 21, 2012.” Appx. A73 (77 Fed. Reg. at 20,413). The NORA

subsequently provided:

Any adverse comments regarding the proposed sale will be

reviewed by the BLM Nevada State Director or other

authorized official of the Department of the Interior who may

sustain, vacate, or modify this realty action. In the absence of

any adverse comments, this realty action will become the final

determination of the Department of the Interior.

Id. at A76 (77 Fed. Reg. at 20,416) (emphasis added). Thus, if 43 U.S.C. § 1713(f) or its

implementing regulations provided the Agency with any contractual right to revisit its

decision to utilize modified competitive bidding procedures, the contract documents

provide that the Agency had to exercise that right prior to May 21, 2012. Put

differently, the “adverse comments” provision, quoted above, suggests that there will

be a singular final determination, not subject to continual reevaluation. Erie Coal & Coke

Corp., 266 U.S. at 520 (“The terms and conditions of the sale as set forth in the

advertisement were binding alike upon the United States and the bidders.”).

Accordingly, even assuming for the sake of argument that parties’ contract

incorporated the statutory or regulatory provisions, the Court holds that none of those

provisions contains any language that even plausibly may be interpreted to provide the

Agency with any contractual right to rescind its acceptance of Silver State’s bid,

terminate the parties’ resulting land sale contract, or to otherwise avoid contractual

liability for failing to convey the subject Property to Silver State.62

4. The NORA’s Plain Language And Precedent Both Support This

Court’s Interpretation Of The Contract At Issue

The Court finds that yet another reason for rejecting the government’s motion to

dismiss is the repeated statement in the NORA that “[n]o contractual or other rights

against the United States may accrue until the BLM authorized officer officially accepts

the high bid offer to purchase and the full bid price is paid.” Appx. A74. 63 The

necessary implication – and, indeed, the only reasonable interpretation of that language

– is that once BLM “accepts the high bid offer . . . and the full bid price is paid,” the

purchaser’s contractual rights do accrue. Given the government’s admission that the

only contractual duty remaining, once Silver State tendered the full purchase for the

Property, was the government’s obligation to issue the land patent to Silver State, when

would contractual rights against the United States accrue? The answer, according to the

government, would seem to be “never” – or “almost never” – if the Court were to agree

with the agency’s putative continuing, near plenary contract power 64 to cancel the

transaction without liability. Not only is this Court unable to locate such a broad

reservation of rights anywhere within the language of the contract documents or the

governing statute or regulations, the government’s interpretation would render the

agreement at issue all but illusory, particularly in light of the parties’ contractual

finding that the transaction, in fact, was lawful. Stockton E. Water Dist. v. United States,

583 F.3d 1344, 1358 (Fed. Cir. 2009) (noting “the obvious question of whether making

the contracts subject to whatever future federal law or policy may hold would make the

contracts illusory”); Hernandez, 325 F. App’x at 908 (declining to construe a “settlement

agreement as giving the agency the option not to” perform because such an

interpretation “would come close to rendering the settlement agreement illusory[,]” and

holding that “[s]uch a construction is disfavored” (quoting 5 Margaret N. Kniffin,

Corbin on Contracts § 24.22 at 234–35 (rev. ed. 1998) for the proposition that “‘[w]hen the

62The absence of such contractual language stands in stark contrast to the advertisement at

issue in Erie Coal, in which the government explicitly reserved, and thereafter exercised, the

right to rescind a sale at auction prior to a specific date. 266 U.S. at 520-21.

63See also Appx. A75; 43 C.F.R. § 2711.3-1(g) (“Until the acceptance of the offer and payment of

the purchase price, the bidder has no contractual or other rights against the United States . . . .”).

64“Thus, the Secretary has the authority to ensure at every stage of a transaction (nomination,

auction, acceptance and patent issuance) that each transfer of land out of federal ownership

remains in the public interest.” Defendants' Memorandum in Opposition to Plaintiff's Motion

for Summary Judgment and in Support of Federal Defendants' Cross-Motion for Summary

Judgment in Silver State I at 14, 2014 WL 12691273 [hereinafter “Def. Opp. in Silver State I”].

words of the contract indicate that a party has promised to perform, such words should

not be interpreted so as to make the promise illusory, even if the context may show an

intent to leave performance subject to the party’s broad discretion.’”)).

Several Department of Interior administrative tribunal decisions support the

Court’s conclusions here. In Exxon Corp., analyzing nearly identical contract terms to

those at issue here (although dealing with the award of an oil and gas lease), the Interior

Board of Land Appeals (“IBLA”) 65 held that where the bidder “was obligated to tender

the balance of the . . . bid . . . in 30 days[,]” and that otherwise a bid deposit would be

forfeited, such a “forfeiture constitutes ‘liquidated damages’ assessed against a high

bidder for failure to fulfill its contractual obligations.” 97 IBLA 330, 335 (May 21, 1987).

Accordingly, “[t]he Government, on the other hand, by accepting the high bid bound

itself to issuance of the lease upon submission by the high bidder of the necessary

documents and balance of the [bid]. Indeed, without this mutuality of consideration,

there would be no basis upon which to enforce the forfeiture of the bid deposit. Thus,

once the Government notifies a high bidder that the bid is acceptable, the Government

has contractually obligated itself to issue the lease[.]” Id. 66

In Chester F. Dawson, 73 IBLA 27, 28 (May 9, 1983), the appellant applied to lease

a 2.5-acre tract of land in Nevada. BLM then sent the appellant a communication which

invited the appellant “to purchase the tract and specified the procedure he should

follow to do so.” Id. The appellant “advised BLM that he wished to purchase the tract

and submitted” payment in accordance with BLM’s instructions. Id. at 30.

65 “The Interior Board of Land Appeals (IBLA) is an appellate review body that exercises the

delegated authority of the Secretary of the Interior to issue final decisions for the Department of

the Interior. Its administrative judges decide appeals from bureau decisions relating to the use

and disposition of public lands and their resources, mineral resources on the Outer Continental

Shelf, and the conduct of surface coal mining operations under the Surface Mining Control and

Reclamation Act.” Office of Hearings and Appeals, Dep’t of the Interior, About the Interior Board

of Land Appeals, https://www.doi.gov/oha/organization/ibla (last visited April 23, 2020).

66The government in this case makes no attempt to square its view of Silver State’s contract

rights with the NORA’s provision entitling BLM to retain a successful bidder’s deposit where

that bidder fails to transmit the total purchase price by the deadline. See Warmuth, 108 IBLA

130, 134-35 (April 3, 1989) (“[T]he District Manager duly notified appellant that his purchase of

the property had been approved and his payment of the purchase price which BLM had

established had been accepted. It seems clear that, under 43 CFR 2711.3-1(g), at that point in

time, contractual rights vested in appellant.”); Exxon Corp., 97 IBLA 330, 334-35 (May 21, 1987)

(“[O]nce the authorized officer has communicated acceptance of a high bid he is thereafter

estopped from rejecting the bid because of a perceived inadequacy in the amount

tendered . . . .[R]ather than exercise the reserved authority to reject any or all bids, the State

Director affirmatively accepted appellant’s bid. By doing so, contractual obligations arose

binding both appellant and the Department.”).

Subsequently, however, BLM notified the appellant that BLM “discovered that the tract

[the appellant] had applied for was subject to prior existing mining claims.” Id. BLM

refused to “issue a patent to Dawson until the question of the validity of the claims was

resolved.” When the mining claims were finally resolved, “BLM advised [the

appellant] that it could process his claim, but that, since the Small Tract Act of June 1,

1938, supra, had been repealed in 1976, its provisions no longer applied, and that he

could therefore only purchase the parcel at current market value, which would be

determined by a new appraisal.” Id.

Implicitly rejecting the sort of argument the government makes in this case, the

IBLA found that BLM’s original communication “was an unequivocal offer to sell [the

appellant] this tract and invited acceptance merely by submitting payment in this

amount.” Id. at 31. Further, the IBLA found that the appellant “did accept the offer by

making payment of the demanded amount on March 14, 1956, at which point a binding

contract to convey the property to appellant was created, subject only to any superior

rights in the tract held by others.” Id. Accordingly, the IBLA held that “[s]ince there

was a binding contract to sell the tract to appellant for $275, BLM may not now increase

the price of the tract.” Id. According to the government in Silver State’s case, BLM

could have canceled the parties’ contract without liability based, for example, upon the

Agency’s revised view of the fair market value (because the FLPMA only permits sales

of land at fair market value and the “sale,” argues the government, is ongoing until

conveyance is completed). As the IBLA itself held, however, such a position is entirely

inconsistent with the notion of a “binding contract” into which the government admits

it entered with Silver State. 67

67Similar to the agency’s position in Dawson, the government here argues that the Secretary

retained the contractual power to review and reverse any number of decisions that BLM

officials made during the sale process, any one of which could have served – in the

government’s view – as a viable basis for not conveying the land patent to Silver State and

avoiding liability for breach. See Tr. at 28:4-10 (“If the secretary in exercising the superintending

authority over the sales of public lands determines there has been some defect in compliance

with the regulations of the statute for determining fair market value, then, yes, the secretary

would have the authority to terminate the sale, but to refund the money as well.”). Under the

government’s interpretation, the Agency for all practical purposes is not bound by contract

until it actually performs the contract by transferring the land patent, given the myriad factors

the Secretary would be allowed to revisit prior to conveyance (notwithstanding the existence of

an otherwise valid contract). See, e.g., 43 U.S.C. §§ 1713(a)(1)-(3) (specifying various land

disposal prerequisites); id. at § 1713(d) (sales of public land must be “at a price not less than

their fair market value”); 1713(e) (for agriculture purposes, size of tracts sold cannot be “larger

than necessary to support a family-sized farm”).

D.C. Circuit precedent also supports the Court’s conclusion here. In Willcoxson v.

United States, 313 F.2d 884 (D.C. Cir. 1963), the Secretary of the Interior conducted a sale

of public land pursuant to the Isolated Tracts Act and its implementing regulations.

The then-applicable regulation, 43 C.F.R. § 250.5, provided that:

until the issuance of a cash certificate, the authorized officer

may at any time determine that the lands should not be sold,

the applicant or any bidder has no contractual or other rights

as against the United States, and no action taken will create

any contractual or other obligation of the United States.

313 F.2d at 886. 68 The plaintiff bid on a tract of land and was declared the high bidder

and “purchaser,” but the Secretary’s designee did not make timely delivery of the cash

certificate to the plaintiff “because of a heavy backlog of work.” Id. Subsequently, the

agency became aware of the presence of valuable minerals on the land, the Secretary

declined to convey the cash certificate, and, “inasmuch as cash certificates had not

issued, [declared] the sales were ‘null and void.’” Id. at 886-87. The plaintiff sued “to

compel the Secretary to issue cash certificates.” Id. at 887.

The D.C. Circuit held:

[b]y providing that the authorized land officer may decide not

to sell at any time prior to the issuance of a cash certificate, the

regulation in effect denotes issuance of the certificate as

acceptance of the applicant's proposal. . . . Until acceptance,

no contract rights arose and no equitable title vested. . . . In

the present case, since no rights in the tracts ever vested, the

Manager was free to consider any facts discovered before the

issuance of a cash certificate.

Id. at 888. Thus, the D.C. Circuit’s decision concluded, by necessary implication, that

had the Secretary issued the cash certificate, thereby formally accepting the bid and

forming a contract, the Secretary would not have been free to consider new facts and

cancel the sale. 69

68A “cash certificate” is a “final certificate issued in connection with a cash entry.” Bureau of

Land Management, Department of Interior, Glossaries of BLM Surveying and Mapping Terms 9

(1980). A cash certificate is “evidenc[e] [of the] acceptance of an offer to purchase public land.”

Ness Inv. Corp. v. U.S. Dep’t of Agr., Forest Serv., 512 F.2d 706, 714 (9th Cir. 1975).

69Neither the parties, the district court, nor the D.C. Circuit addressed Willcoxson in Silver State I

or II. The Court finds it difficult to square the Silver State I and II decisions with the D.C.

Returning to § 1713(f), that statutory provision, at best, is akin to a FAR provision

governing an agency’s selection of a particular contracting method, but that does not

yield any contractual rights or obligations in a resulting contract (even if the provision

had been incorporated verbatim). For example, where the government exercises its

discretion to engage in a sole-source procurement (see, e.g., FAR 6.302-1), and then

awards a contract without competition, the government cannot later reconsider its

written justification for the sole-source award and unilaterally terminate the

procurement without paying damages. Indeed, “[t]he fact that a contract may be

inconsistent with a statutory or regulatory requirement does not ipso facto render the

contract void.” Seh Ahn Lee v. United States, 895 F.3d 1363, 1372 (Fed. Cir. 2018). 70 The

government does not contend that the parties’ contract here was void ab initio, see Tr. at

39:22-24, but rather effectively argues that “another procedure would have been

preferable or better attuned to the aims of the competitive bidding legislation.” John

Reiner & Co. v. United States, 325 F.2d 438, 440 (Ct. Cl. 1963) (“If the contracting officer

has viewed the award as lawful, and it is reasonable to take that position under the

legislation and regulations, the court should normally follow suit.”). Here, the

government concedes the parties’ contract was valid when formed, resulting from a

sales process that was lawful when conducted, and nothing in § 1713(f) permits the

Agency to undo its selected method of sale.

5. No Other Contract Terms Permit the Government to Avoid Its

Contractual Obligation to Silver State

Although the government concedes that its motion to dismiss hinges on the

incorporation of 43 U.S.C. § 1713(f) in the contract at issue – an interpretation this Court

Circuit’s decision in Willcoxson. If the Secretary’s designee is always free to revisit a decision

and consider new facts before issuing a patent (as Silver State I and II hold), why did the D.C.

Circuit hold in Willcoxson that “since no rights in the tracts ever vested, the Manager [the

Secretary’s designee] was free to consider any facts discovered before the issuance of a cash

certificate”? 313 F.2d at 888 (emphasis added). The necessary implication of Willcoxson appears

to be that a proper, legal acceptance – as occurred in this case – would have resulted in vested

contract rights that Interior could not revisit even prior to formally transferring the property.

70To the contrary, “[i]nvalidation of the contract is not a necessary consequence when a statute

or regulation has been contravened, but must be considered in light of the statutory or

regulatory purpose, with recognition of the strong policy of supporting the integrity of

contracts made by and with the United States.” Am. Tel. & Tel. Co. v. United States, 177 F.3d 1368,

1374 (Fed. Cir. 1999) (en banc). The Court rejects the notion that 43 U.S.C. § 1713(f) was

somehow contravened – or that it could be contravened once Silver State tendered the total bid

price for the Property – but the government remains free to engage in discovery regarding

whether Silver State’s representations to the Agency may provide grounds for the government

to argue that the contract should be held invalid or voided. See infra, Section VI.

rejected above – the government at times contends that its power to terminate the

transaction without liability depends upon the application of yet other statutory

provisions, namely 43 U.S.C. § 1457 and 43 U.S.C § 2. See Def. Mot. at 30 (“The

Secretary (acting through the Assistant Secretary) relied on [43 U.S.C. § 1457] to order

the cancellation of the unlawful sale to Silver State.”); Def. Reply at 21 (“Finally, it is not

‘absurd’ for the Secretary ‘to continuously monitor’ whether a sale of Federal public

land satisfies the requirements of FLPMA, including ‘after [an] auction sale has

concluded.’ Congress has ‘charged the Secretary with precisely that responsibility.

43 U.S.C. § 1457”); Appx. A192; Tr. at 37:1 - 38:5 (“Section 2 and Section 1457 of Title 43,

which not only authorize, but charge the secretary with the final superintending

authority to ensure that all sales of public lands are in compliance with the laws.”).

Those other statutory provisions – whether considered independently or

collectively – do not yield the government a contractual right to revisit the decision to

utilize modified competitive bidding procedures to solicit offers, particularly not after

accepting Silver State’s bid and its payment of the total bid price, because the parties’

contract does not incorporate any of those additional provisions. There is simply no

contractual document that contains even a bare reference to 43 U.S.C. § 1457 or 43

U.S.C. § 2. See generally Appx. A73-76, A84-101, A106-08, A162-64, A183-85.

Consequently, the contract, with respect to 43 U.S.C. § 1457 and 43 U.S.C § 2, does not

meet our Circuit’s standard for incorporation by reference, as explained above. See

Northrop Grumman Info. Tech., Inc., 535 F.3d at 1345 (the “reference must explicitly, or at

least precisely, identify the written material being incorporated and must clearly

communicate that the purpose of the reference is to incorporate the referenced material

into the contract”). To the extent the government argues that the contract incorporates

those statutes by reference to the FLPMA or some other act of Congress, the Court finds

that position contrary to the rationale underlying the binding precedent in this Circuit.

See St. Christopher Assocs., 511 F.3d at 1384 (disfavoring “wholesale incorporation of

regulations into a contract” and the creation of ‘[a] wholly new ground of obligation . . .

by mere implication.’” (quoting Smithson, 847 F.2d at 794)).

Second, whatever authority those additional statutory provisions confer on the

Agency, generally, none of them can be transmogrified into contractual rights or into

extra-contractual powers permitting the government to avoid liability here for breach of

contract. While the Court does not question the preclusive effect of the decision in

Silver State’s APA litigation regarding the Secretary’s plenary power not to convey the

land patent to Silver State, 71 the Court holds, as a matter of contract interpretation, that

had the parties’ contract incorporated the statutory provisions at issue as contract terms

71 See infra, Section IV.

(which the contract did not), such terms would not provide the Agency with the power

to avoid liability for the alleged breach. For example, 43 U.S.C. § 2 provides:

The Secretary of the Interior or such officer as he may

designate shall perform all executive duties appertaining to

the surveying and sale of the public lands of the United States,

or in anywise respecting such public lands, and, also, such as

relate to private claims of land, and the issuing of patents for

all grants of land under the authority of the Government.

As discussed above, the Secretary’s designated officer already performed the executive

duty “appertaining to the . . . sale of . . . public land” that 43 U.S.C. § 1713(f) prescribes

when BLM determined, at the latest in the NORA, that the Agency would employ

modified competitive bidding procedures. Nothing in the plain language of

43 U.S.C. § 2, even when combined with 43 U.S.C. § 1713(f), gives the Secretary’s

designated officer the ability to revisit that determination after contract formation, make

a new discretionary determination that modified competitive bidding retroactively was

not appropriate in light of events that transpired after contract formation, and then

refuse to perform under a binding contract while avoiding liability for its breach.

Nor does the plain language of 43 U.S.C. § 1457 aid the government here. That

statute provides as follows:

The Secretary of the Interior is charged with the supervision

of public business relating to the following subjects and

agencies:

1. Alaska Railroad.

2. Alaska Road Commission.

3. Bounty-lands.

4. Bureau of Land Management.

5. United States Bureau of Mines.

6. Bureau of Reclamation.

7. Division of Territories and Island Possessions.

8. Fish and Wildlife Service.

9. United States Geological Survey.

10. Indians.

11. National Park Service.

12. Petroleum conservation.

13. Public lands, including mines.

This statute cannot reasonably be read as granting the Secretary’s designated officer the

reservation of contract powers the government asserts (i.e., to effectively void a binding

contract at the government’s option without liability). See C. Sanchez and Son, Inc. v.

United States, 6 F.3d 1539, 1543 (Fed. Cir. 1993) (“A contract is read in accordance with

its express terms and the plain meaning thereof.”). Indeed, the government does not

cite to a single case in which any court has held that 43 U.S.C. §§ 2 or 1457 grant the

Secretary the power to avoid performance of a valid contract while avoiding liability for

breach, and, as discussed above, the IBLA implicitly has rejected this argument. See

Chester F. Dawson, 73 IBLA 27 (May 9, 1983). The Court recognizes the preclusive effect

of the prior APA litigation, but that holding does not mean that, as a matter of contract

law, the Secretary has the power to avoid liability for breach of contract; it only means

that Silver State was not entitled to injunctive relief under the statute and the APA. 72

The government does not argue that it may avoid liability for breach because the

parties’ contract incorporated the Secretary’s power under 43 C.F.R. § 4.5. The Assistant

Secretary, however, took “jurisdiction over this matter, pursuant to the authority

reflected in 43 C.F.R. § 4.5(a)” and rendered a “final decision” directing BLM not to

convey the land patent to Silver State. Appx. A195. Accordingly, it appears that the

government’s argument should also hinge, at least in part, on the contract’s having

72 Neither the district court nor this Court has the power to order specific performance of a

government contract. Stewart v. Mabus, 2016 WL 753939, at *7 (D.D.C. Feb. 24, 2019) (“‘[T]he

Tucker Act and Little Tucker Act’ provide the exclusive remedies for any alleged breach of

contract by the federal government and thereby ‘impliedly forbid’ the federal courts’

jurisdiction to grant declaratory relief or specific performance in contract cases.” (quoting Sharp

v. Weinberger, 798 F.2d 1521, 1253 (D.C. Cir. 1986)); see Suburban Mortg. Assocs., Inc. v. U.S. Dep't

of Housing & Urban Dev., 480 F.3d 1116, 1128 (Fed. Cir. 2007) (“Since the Tucker Act grants

consent for suits based on contract, this has been interpreted by . . . other courts to preclude

under the APA contract claims of any kind, either for damages or specific performance”); see

also, infra, Section IV.

incorporated that power. Nevertheless, the government cannot rely upon 43 C.F.R. § 4.5

to avoid liability for breach for at least three reasons.

First, none of the contract documents contain even a bare reference to

43 C.F.R. § 4.5.

Second, even if the parties’ contract had incorporated 43 C.F.R. § 4.5 as a contract

term, the Court is unsure whether, as a matter of contract interpretation, 43 C.F.R. § 4.5

would authorize the Assistant Secretary to “assume jurisdiction” over the matter here

and permit the Agency not to convey the land patent. In that regard, the regulation —

located within 43 C.F.R. Part 4, Department Hearings and Appeals Procedures, Subpart

A, General; Office of Hearings and Appeals — provides that the Secretary may assume

“jurisdiction at any stage of any case before any employee or employees of the

Department,” 43 C.F.R. § 4.5(a)(1), or “review any decision of any employee or

employees of the Department.” 43 C.F.R. § 4.5(a)(2). In context, the regulation appears

to provide the Secretary with the specified authority only when a party has filed an

administrative appeal, and, indeed, the Court located only one case in which BLM

invoked the power under 43 C.F.R. § 4.5(a) when there was no pending administrative

appeal. In that case, however, the United States District Court for the District of South

Dakota questioned the Secretary’s authority to assume jurisdiction to review the

decision at issue in the absence of an administrative appeal, although the court

ultimately decided the question on other grounds. See Rosebud Sioux Tribe v. Gover, 104

F. Supp. 2d 1194, 1200–01 (D.S.D. 2000), vacated sub nom. on other grounds Rosebud Sioux

Tribe v. McDivitt, 286 F.3d 1031 (8th Cir. 2002).

Third, even if the parties’ contract had included 43 C.F.R. § 4.5 and even if that

regulatory provision were read to reserve to the Assistant Secretary the authority to

order BLM not to convey the land, BLM may have breached its contractual duty under

that regulation. Specifically, 43 C.F.R. § 4.5(c) provides as follows:

If the Secretary or Director assumes jurisdiction of a case or

reviews a decision, the parties and the appropriate

Departmental personnel will be advised in writing of such

action, the administrative record will be requested, and, after

the review process is completed, a written decision will be

issued.

The Assistant Secretary, after assuming jurisdiction over the matter pursuant to

43 C.F.R. § 4.5(a), apparently never notified Silver State of BLM’s Recommendation

Memorandum, nor does the record before this Court reflect that the Assistant Secretary

requested and reviewed the administrative record prior to issuing a written decision

adopting BLM’s recommendation. See Rosebud Sioux Tribe, 104 F. Supp. 2d at 1200-01

(“Assuming that . . . the Assistant Secretary did have authority to assume jurisdiction

over the matter or to review the decisions of the local BIA officials [he] would have been

bound to follow the requirements of the regulation in exercising any inherent authority,

[and] he clearly did not adhere to the procedures outlined in § 4.5(c).”).

* * * *

At base, the government’s motion to dismiss turns upon whether the parties’

contract contained terms reserving the government’s right to: (1) reverse its

determination, made prior to the NORA’s issuance, that a modified competitive sale

was proper and lawful; (2) undo its acceptance of Silver State’s bid; (3) delete

unilaterally the parties’ contractual finding in the escrow agreement that the completed

sale was lawful and proper; and (4) terminate the contract at issue notwithstanding that

Silver State tendered timely final payment consistent with the NORA, BLM’s

Acceptance Letter, and the bilateral escrow instructions. The Court holds that the

parties’ contract contains no such reservation of rights in favor of the government, and

the government’s meld of the various statutory and regulatory provisions upon which

it relies cannot yield contract rights ex nihilo.

To be clear, the question in this case is not whether the government has an

ongoing statutory or regulatory duty to follow the law or even to ensure that its

contractual processes, resulting in land sale contracts, are lawful. This Court decides

neither the scope of the Agency’s plenary power over federal lands prior to their

conveyance, nor the Agency’s statutory power to decline to convey land pursuant to

governing statutes and regulations. 73 Rather, this decision holds only that once the

government sold the Property pursuant to the NORA’s process, and thus entered into a

contract with Silver State – here, at the latest, when Silver State tendered its full bid

price pursuant to the agreed-upon escrow instructions

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