Record and brief — United States v. Navajo Nation

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eens aw Paes CU 7 FS OC Oe

No. 07-1410

Title: United States, Petitioner

Vv.

Navajo Nation

Docketed: May 13, 2008

Lower Ct: United States Court of Appeals for the Federal Circuit

Case Nos.: (2006-5059)

Decision Date: September 13, 2007

Rehearing Denied: January |4, 2008

Questions Presenied

~~~Date~~~ ~~~~~~~Proceedings and Orders~~~~~~~~~~~~~~~~~~~~~

Apr 3 2008 Application (07A817) to extend the time to file a petition for a writ of certiorari from

April 13, 2008 to May 13, 2008, submitted to The Chief Justice.

Apr9 2008 Application (07A817) granted by The Chief Justice extending the time to file until May

13. 2008.

May 13 2008 Petition for a writ of certiorari filed. (Response due June 12, 2008)

May 13 2008 Appendix of United States filed.

May 16 2008 Order extending time to file response to petition to and including July 14, 2008.

Jul 11 2008 Order further extending time to file response to petition to and including August 4, 2008.

Aug 4 2008 Brief of respondent Navajo Nation in opposition filed.

Aug 20 2008 DISTRIBUTED for Conference of September 29, 2008.

Aug 21 2008 Reply of petitioner United States filed. (Distributed)

Oct 1 2008 Petition GRANTED.

Oct 22 2008 The time within which to file the joint appendix and petitioner's brief on the merits is

extended to and including November 26, 2008.

Oct 22 2008 The time within which to file respondent's brief on the merits is extended to and including

January 9, 2009.

Nov 25 2008 Joint appendix filed. (Jt. Appendix in three volumes). Statement of costs filed.

Nov 26 2008 Brief of petitioner United States filed.

Dec 3 2008 Brief amici curiae of Peabody Western Coal Company, and Southern California Edison

Company filed. (Distributed)

Dec 5 2008 CIRCULATED.

Dec 8 2008 SET FOR ARGUMENT ON Monday, February 23, 2009

Jan 5 2009 _ Letter from counse! for respondent seeking permission to lodge copies of a brief cited to

in respondent's brief on the merits.

Jan 92009 __ Brief of respondent Navajo Nation filed. (Distributed)

Jan 162009 Record received from the U.S.C.A. for the Federal Circuit. (1 box)

Jan 16 2009 Brief amici curiae of Former Secretaries of the Interior, Ceci! D. Andrus. ei al. filed

(Distnbuted)

Jan 16 2009 Brief amici curiae of Law Professors filed. (Distributed)

Jan 16 2009 Brief amici curiae of New Mexico, Arizona, and Utah filed (Distributed)

Jan 16 2009 Brief amici curiae of National Congress of American Indians, et al. filed. (Distributed)

Feb 9 2009 Reply of petitioner United States filed. (Distributed)

weer we Fe wereellwserehU mhTTChUcTCc TO aE oe

Feb 23 2009 Argued. For petitioner: Edwin S. Kneedler, Acting Solicitor General, Department of

Justice, Washington, D.C. For respondent: Carter G. Phillips, Washington, D.C.

Oe ee ee ee ee ee es

~~Name~~~~~~~~~~~~~~~~ ~Address~~~~~~~~ ~~~ ~~~ ~~~ ~~Phone~~~

Attorneys for Petitioner:

Edwin S. Kneedler Acting Solicitor General oe _

Counsel of Record United States Department of Justice

950 Pennsylvania Avenue, N.W.

Washington, DC 20530-0001

Party name: United States

Attorneys for Respondent:

Carter G. Phillips Sidley Austin LLP —

Counsel of Record 1501 K Street, N.W.

Washington, DC 20005

cphillips@sidley.com

Party name: Navajo Nation

Other:

Reid Peyton Chambers Sonosky Chambers Sachse Endreson & Perry ape oe.

1425 K Street, NW, Suite 600

Washington, DC 20005

Party name: National Congress of American Indians, et al.

Charles G. Cole Steptoe & Johnson LLP posers <>

1330 Connecticut Avenue, N.W.

Washington, DC 20036

Party name: Peabody Western Coal Company, and Southern California Edison Company

Richard B. Collins Professor of Law * a )492-

University of Colorado

401 UCB

_ Boulder, CO

Party name |.aw Professors

Quinn Emanuel Urquhart Oliver & Hedges, (212) 849-

LLP 7000

51 Madison Avenue, 22nd FI.

Kathleen M. Sullivan

Se Vynrws Swe wrUlKE Trew

——-—-=

New York, NY 10010

kathleensulli van@ uinnemanuel com

Party name: Former Secretaries of the Interior, Cecil D. Andrus, et al.

David K. Thomson Deputy Attorney General coe -

Office of the Attorney General of New Mexico

P.O. Drawer 1508

Santa Fe, NM 87504-1508

dthomson@nmag.gov

Party name: New Mexico, Arizona, and Utah

PETITION

FOR

WRIT OF

CERTIORARI

No.

Jn the Supreme Court of the United States

UNITED STATES OF AMERICA, PETITIONER

NAVAJO NATION

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE FEDERAL CIRCUIT

PETITION FOR A WRIT OF CERTIORARI

PAUL D. CLEMENT

Solicitor General

Counsel of Record

RONALD J. TENPAS

Assistant Attorney General

EDWIN S. KNEEDLER

Deputy Solicitor General

ANTHONY A. YANG

Assistant to the Solicitor

General

ELIZABETH A. PETERSON

Attorney

Department of Justice

Washington, D.C. 20530-0001

202) 514-2217

QUESTIONS PRESENTED

The Indian Mineral Leasing Act of 1938 (IMLA), 25

U.S.C. 396a et seq., and its implementing regulations

authorize Indian Tribes, with the approval of the Secre-

tary of the Interior, to lease tribal lands for mining pur-

poses. In a previous decision in this case, United States

v. Navajo Nation, 537 U.S. 488 (2003) (Navajo), this

Court held that the Secretary’s actions in connection

with Indian mineral lease amendments containing in-

creased royalty rates negotiated by the Navajo Nation

did not breach a fiduciary duty found in IMLA or other

relevant statutes or regulations. The court of appeals

held on remand that the Secretary’s conduct breached

duties linked to sources of law that had been briefed to

this Court but not expressly discussed in Navajo. The

questions presented are:

1. Whether the court of appeals’ holding that the

United States breached fiduciary duties in connection

with the Navajo coal lease amendments is foreclosed by

Navajo.

2. If Navajo did not foreclose the question, whether

the court of appeals properly held that the United States

is liable as a mater of law to the Navajo Nation for up to

$600 million for the Secretary’s actions in connection

with his approval of amendments to an Indian mineral

lease based on several statutes that do not address roy-

alty rates in tribal leases and common-law principles not

embodied in a governing statute or regulation.

(1)

TABLE OF CONTENTS

Page

I ii ak id whe hia ese ates 6 dalek as uses l

EET: era RGD ERO BN Og pare Re eND l

Statutory and regulatory provisions involved ............. 2

ee i ain ieee anadaecneedreus ens 2

Reasons for granting the petition ...................... 15

A. This Court’s decision in this case foreclosed the

basis for liability adopted by the Federal Circuit .... 16

B. The court of appeals’ ruling, even if not completely

foreclosed by Navajo, is in any event flatly

inconsistent with Navajo and this Court’s decisions

forming the basis for Navajo .................000. 20

C. The court of appeals’ decision threatens serious

adverse consequences for the government ......... 32

IIT <9. 5-0: acetals eee cA eek odlkd ok peeende 33

TABLE OF AUTHORITIES

Cases:

Chevron U.S.A. Inc. v. NRDC, 467 U_ 5S. 837 (1984) .... 30

Department of Army v. Blue Fox, Inc., 525 U.S. 255

RE a eed See ie ee eu sb auneeean 20

Lane v. Pena, 518 U.S. 187 (1996) ...............0000 20

Morales v. TWA, 504 U.S. 374 (1992) ................. 28

United States v. Hopkins, 427 U.S. 123 (1976) ......... 29

United States v. Mitchell:

EE cc cee ckcccbeccnceeses 8, 11, 19, 21

I iss iis wk neva see ONS ED passim

(111)

Cases—Continued: Page

United States v. Navajo Nation, 537 U.S. 488

CE dnc d schon bods eb as cucudevnss 66 0see2h passim

United States v. Testan, 424 U.S. 392 (1976) ....... 22, 29

United States v. White Mountain Apache Tribe,

Be a PGE SV edsccessvesccvees 12, 21, 23, 24, 27

United States Dep't of Energy v. Ohio, 503 U.S. 607

SE Ania ipsa ud dde ven ednds an eeuweetetins vas esos 20

Wolfchild v. United States, 78 Fed. Cl. 472 (2007),

appeal pending, No. 08-5018 (Fed. Cir. filed

RT er hs Pn 32

Statutes and regulations:

Act of Mar. 18, 1960, Pub. L. No. 86-392, 74 Stat.8 ..... 24

Federal Oil and Gas Royalty Management Act of

SP SUR OOM occ dceesidecsesessccnns 13

Indian Mineral Development Act of 1982, 25 U.S.C.

SE ECU cee 5 Wes Gagne 6oNbendiae sé bees 9

Indian Mineral Leasing Act of 1938, 25 U.S.C. 396a

ERE TOT eer. eee TL eee PTeTT TTT TTT, 2

RE ES ER ne Seer ee nee 2, 31

Indian Tucker Act, 28 U.S.C. 1505 .............00.. 8, 21

Mineral Leasing Act, 30 U.S.C. 207(a) ................. 5

Navajo-Hopi Rehabilitation Act, 25 U.S.C. 681 et seq. ... 4

SENT Or Pe eer eee ee emer 4,16

i inc ivaseseeninda cies eeawn 14, 28

EE os cs. ceed do¥s bbe deeekanemeee 4

EE re ee ie bac cened peenkeden 4, 28

I Dale co ce bk beh ecaked ds aaa een 16

PE .cthernevn debe neecesuseenasd™ 14, 28

Statutes and regulations—Continued: Page

Surface Mining Control and Reclamation Act of 1977,

30 U.S.C. 1201 et seg. ......... ‘biadadiveiaebeeee 3

i ins Fe bcKb ik canbe eee 3

PRI bi 600.5 0 cnswdsnesweeens Koeneueenl 4

rr ee 3

cc ine ees eokns cede 3

SE 5. dc ccccpue Gevutesenbeeunee 3

EE ie 6-00 0 60.06s0u nds en beeeaeneee 3

UII bb.bcecocdceosasancesestusmene 3

EE Scots ev sobheoucnbeh ese eeeen 3

PEED 5. ds vv ccvsccstecsenecuntenee 3

oo ca wt © oneal wa 3, 16

I, on i'n 0 6'u4.0s 00 aban heee eee 3, 30

I, conc dncckewseancaee 3, 14, 30, 31

We Se EP EAA, EEE oc ccc ccccuceceeens 21, 22

ED cis i- owes tdacebncssewseueanas 9, 11, 13, 18

ED os 6.56 04 0 ba vieee veneeees ee eeseneee 25

IME. x's. s 6.0'5.050 00.00600n0600006n wee eee 25

EE Sig's pn i 0b.4'6k0eesewks be eee ee 25

25 C.F.R.:

Eee erm ey 25

Pere 25

Eg o'c nn cc cocevnedeescceweselen 25

ID Wi e-ins dncvoees cas bee ewawenene 3, 30

EDs os 4400.05 600s500 0a be eee eee 5

PEN EEEED 500000 vnns sewsdeeedeumeeee 5

Regulations—Continued Page

Ne oa vbewnenaea 16

a ie ol an a nrg or 29

a a al re eee peel 30

ees oa eke 4

ened ewndee 14

Nd re ee ia ewedandel 29

EEL AS a ee 4, 30

Miscellaneous:

AMINED... 5555. c ccc cc cececcss 30

POD vavvcccccesccedcvccceseus 30

H.R. Rep. No. 2455, 85th Cong., 2d Sess. (1958) ..... 4, 29

S. Rep. No. 11, 93d Cong., Ist Sess. (1973) .......... 5, 29

—

In the Supreme Court of the Gnited States

No.

UNITED STATES OF AMERICA, PETITIONER

Vv,

NAVAJO NATION

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE FEDERAL CIRCUIT

PETITION FOR A WRIT OF CERTIORARI

The Solicitor General, on behalf of the United States of

America, respectfully petitions for a writ of certiorari to

review the judgment of the United States Court of Appeals

for the Federal Circuit in this case.

OPINIONS BELOW

The opinions of the court of appeals (App. la-43a,

72a-87a, 88a-117a) are reported at 501 F.3d 1327, 347

F.3d 1327, and 263 F.3d 1325. The opinions of the Court

of Federal Claims (App. 44a-69a, 118a-166a) are re-

ported at 68 Fed. Cl. 805 and 46 Fed. Cl. 217.

JURISDICTION

The judgment of the court of appeals was entered on

September 13, 2007. A petition for rehearing was denied

on January 14, 2008 (App. 70a-71a). On April 9, 2008,

the Chief Justice extended the time within which to file

(1)

a petition for a writ of certiorari to and including May

13, 2008. The jurisdiction of this Court is invoked under

28 U.S.C. 1254(1).

STATUTORY AND REGULATORY

PROVISIONS INVOLVED

Pertinent provisions are set out in the appendix to

the petition (App. 167a-175a).

STATEMENT

This case concerns the potential liability of the

United States for up to $600 million in damages for an

alleged breach of trust connected to the Secretary of the

Interior’s approval of mineral lease amendments con-

taining new royalty rates agreed to by the Navajo Na-

tion (Tribe) and a private lessee. This Court previously

reversed the Federal Circuit’s decision finding the

United States liable in this very case, holding that the

Acts of Congress addressing minerai leasing imposed no

specific fiduciary or other duties enforceable in a suit for

money damages. United States v. Navajo Nation, 537

U.S. 488 (2003) (Navajo). The Federal Circuit has now

reinstated its prior finding of liability for the same con-

duct based on several statutes having nothing to do with

royalty rates for mineral leases and common-law trust

principles not embodied in any statute or regulation.

1. a. The United States, through the Secretary of

the Interior, regulates the leasing of mineral resources

on Indian lands under the Indian Mineral Leasing Act

of 1938 (IMLA), 25 U.S.C. 396a et seg., and regulations

issued thereunder. IMLA authorizes Indian Tribes,

“with the approval of the Secretary,” to lease unallotted

tribal lands for mining purposes. 25 U.S.C. 396a. Un-

like prior statutes governing mineral leases, IMLA is

“designed to advance tribal independence, empowers

Tribes to negotiate mining leases themselves, and, as to

coal leases, assigns primarily an approval role to the

Secretary.” Navajo, 537 U.S. at 494, 508.

b. The Secretary also administers the Surface Min-

ing Control and Reclamation Act of 1977 (SMCRA), 30

U.S.C. 1201 et seg., which the court of appeals found

relevant to this case. SMCRA “establish[es] a nation-

wide program to protect society and the environment

from the adverse effects of surface coal mining opera-

tions.” 30 U.S.C. 1202(a), 1251(b), 1291(23); ef. 30 U.S.C.

1253-1254. SMCRA imposes permitting and other re-

quirements that set performance standards for on-going

surface coal mining operations and requires plans for

post-mining reclamation. See, e.g., 30 U.S.C. 1257-1260,

1265.

SMCRA’s Indian lands provision, 30 U.S.C. 1300,

specifies that “all surface coal mining operations on In-

dian lands shall comply with requirements at least as

stringent as those imposed” by pertinent provisions of

the Act, and that “the Secretary shall incorporate the

requirements of such provisions in all existing and new

leases issued for coal on Indian lands.” 30 U.S.C.

1300(d); ef. 30 U.S.C. 1273(a), 1291(9). In addition to

those mandatory lease requirements, the Act provides

that Secretary shall also, for “leases issued after August

3, 1977, * * * include and enforce terms and conditions

* * * as may be requested by the Indian tribe in such

leases.” 30 U.S.C. 1300(e); see 25 C.F.R. 200.11(b) (im-

plementing regulation providing for inclusion of lease

terms “related to” SMCRA requested by lessor Tribe).

The Office of Surface Mining Reclamation and

Enforcement (OSM) has regulatory authority over

Indian lands under SMCRA, and OSM routinely con-

sults with the Bureau of Indian Affairs (BIA) before

exercising that authority. See 30 U.S.C. 1211; 30 C.F.R.

750.6(a)(1)-(4). The BIA, in turn, is responsible for con-

sulting directly with affected Tribes and making recom-

mendations to OSM concerning OSM’s regulatory ac-

tions “relating to surface coal mining and reclamation

operations on Indian lands.” 30 C.F.R. 750.6(d)(1)-(2).

2. a. The Navajo Nation occupies the largest Indian

reservation in the United States. Over the past century,

large deposits of coal have been discovered on the

Tribe’s lands, which are held for it in trust by the United

States. Navajo, 537 U.S. at 495.

In the Navajo-Hopi Rehabilitation Act of 1950 (Re-

habilitation Act), 25 U.S.C. 631 et seq., which the court

of appeals also found to be relevant in this case, Con-

gress authorized the Secretary to undertake, “within the

limits of the funds * * * appropriated pursuant to [the

Act],” a “program of basic improvements for the conser-

vation and development of resources of the Navajo and

Hopi Indians [and] the more productive emnployment

of their manpower.” 25 U.S.C. 631. The program in-

cluded education, road, soil and water conservation, irri-

gation, telecommunications, and business development

projects, as well as “[sJurveys and studies of timber,

coal, mineral, and other physical and human resources.”

Ibid. Congress initially authorized approximately $89

million fur the program, including $500,000 for surveys

and studies, ibid.; and directed the Secretary to com-

plete the program, so far as practicable, within a 10-year

period. 25 U.S.C. 632; ef. H.R. Rep. No. 2455, 85th

Cong., 2d Sess. 4, 7 (1958). After Congress authorized

an additional $20 million for essential roads in 1958,

ibid.; 25 U.S.C. 631(7), road construction ended around

1964, and the Secretary completed the program autho-

rized by the Act at that time. S. Rep. No. 11, 93d Cong.,

Ist Sess. 1 (1973).

Today, the Tribe receives millions of dollars in roy-

alty payments pursuant to mineral leases with private

companies. The lease at issue in this case, Lease 8580,

was executed by the Tribe and a predecessor to the Pea-

body Coal Company (Peabody) and took effect in 1964

upon approval by the Secretary. It provided that “the

royalty provisions of this lease are subject to reasonable

adjustment by the Secretary * * * or his authorized

representative” on the 20-year anniversary of the lease,

and every ten years thereafter. Navajo, 537 U.S. at 495.

As the 20-year anniversary of Lease 8580 ap-

proached, its royalty rate of 37.5 cents per ton yielded a

royalty of approximately 2% of gross proceeds. That

rate was above the minimum rate of 10 cents per ton

established by then-applicable IMLA regulations, 25

C.F.R. 211.15(c) (1985), but was substantially below the

minimum royalty rate of 12.5% established in 1976 for

coal mined on federal lands under the Mineral Leasing

Act, 30 U.S.C. 207(a). 537 U.S. at 495-496.

b. In March 1984, the Chairman of the Tribe wrete

to the Secretary asking him to exercise his authority

under Lease 8580 to adjust the royalty rate. In June

1984, the Director of the BIA Navajo Area Office, acting

pursuant to authority delegated by the Secretary, issued

an opinion letter adjusting the royalty rate to 20% of

gross proceeds. 537 U.S. at 496.

Peabody filed an administrative appeal of the Area

Director’s decision in July 1984, pursuant to 25 C.F.R.

211.2 (1985). That informal appeal process was “largely

unconstrained by formal requirements,” including any

prohibition on ex parte communications. 537 U.S. at

513.' The appeal was referred to the Deputy Assistant

Secretary for Indian Affairs, John Fritz, acting as both

Commissioner of Indian Affairs and Assistant Secretary

for Indian Affairs. After 30 days had elapsed from the

parties’ final pleading deadline without a decision by

Fritz, the Tribe and Peabody each were entitled under

regulations then in effect to have the matter transferred

to the Board of Indian Appeals (Board) for a more for-

malized appeal process in which ex parte communica-

tions would have been prohibited. /d. at 496 & n.3, 513.

Neither invoked that right and, by June 1985, the par-

ties anticipated that a decision favorable to the Tribe

was imminent. /d. at 496. Such a decision would have

been subject to further review and modification by the

Secretary. /d. at 498 n.4, 513-514.

On July 5, 1985, a Peabody Vice President wrote to

the Secretary with a copy to the Tribe urging him either

to rule in Peabody’s favor or to postpone a decision to

allow fer a negotiated settlement. The Tribe responded

by letter to the Secretary requesting a prompt decision

in its favor. Peabody representatives then met privately

with then-Secretary Donald Hodel in July 1985. No rep-

resentative of the Tribe was either present at or re-

ceived notice of that meeting. 537 U.S. at 497.

On July 17, 1985, Secretary Hodel sent a memoran-

dum to Deputy Assistant Secretary Fritz “‘suggest|ing]’

that Fritz ‘inform the involved parties that a decision on

' The Tribe availed itself on multiple occasions of the opportunity to

contact Interior officials while Peabody's appeal was pending without

notifying Peabody. See C.A. App. A468 (“confidential” communication

from Tribe to Secretary regarding Peabody's appeal in November

1984): Gov't Fed. Cl. Supp. Br. in Resp. on Remand App. 11 (internal

Tribal memorandum documenting May 1985 communications with

Interior Department officials concerning Peabody's appeal).

th[e] appeal is not imminent and urge them to continue

with efforts to resolve this matter in a mutually agree-

able fashion.’” 537 U.S. at 497. “‘Any royalty adjust-

ment which is imposed on the parties without their con-

currence,’ the memorandum stated, ‘will almost cer-

tainly be the subject of protracted and costly appeals,’

and ‘could well impair the future of the contractual rela-

tionship’ between the parties.” /bid. The Tribe has as-

serted that it was not told of the Secretary’s memoran-

dum, but it did learn that “someone from Washington”

urged a return to negotiations. /d. at 498.°

In late August 1985, the Tribe resumed negotiations

with Peabody. On September 23, 1985, the parties

reached tentative agreement on a package of amend-

ments that, among other things, increased the royalty

rate for Lease 8580 to 12.5%, the then-standard royalty

rate for federal-coal leases. The amendments also in-

cluded many other provisions benefitting the Tribe, in-

cluding retroactive application of the increased royalty

rate, increased royalties on a separate lease that did not

provide for royalty-rate adjustments by the Secretary,

and payment to the Tribe of cash bonuses and then-dis-

puted tribal taxes. 537 U.S. at 498-500 & nn.5, 7. After

the Navajo Tribal Council approved the lease amend-

ments and the parties signed a final agreement in No-

* In fact, documents drafted by the Tribe's Attorney General explain

that the Chairman of the Navajo Tribal Council met with Fritz in 1985,

and that Fritz “explicitly” advised him “that he would not decide

Peabody's appeal until the Navajo Tribe made a final attempt to

negotiate with Peabody to avoid further litigation.” Gov't Fed. Cl.

Supp. Br. in Resp. on Remand App. 1, 5; see id. at 9 (Tribal minutes

dated July 1986 stating that “the Secretary had asked Peabody and the

Navajo Nation to sit down and try to work out their differences”

regarding Peabody's appeal and “has indicated an unwillingness to act

on this until we have given it one last shot.”).

vember 1987, Secretary Hodel approved the amend-

ments on December 14, 1987. Pursuant to the parties’

stipulation, the Area Director’s decision was vacated,

terminating Peabody’s administrative appeal. /d. at 500.

3. a. In 1993, the Tribe sued the United States in the

Court of Federal Claims for $600 million in damages

under the Indian Tucker Act, 28 U.S.C. 1505, alleging

that the Secretary’s approval of the lease amendments

agreed to by the Tribe and Peabody constituted a breach

of trust. The court granted the government’s motion for

summary judgment. App. 118a-166a. It concluded that

the United States owed general fiduciary duties to the

Tribe, and that the Secretary had violated common-law

duties of care, loyalty, and candor by meeting secretly

with Peabody representatives and acting in its best in-

terests rather than the Tribe’s. App. 135a-136a; 537

U.S. at 501. But the court concluded that the Tribe

failed to state a claim for damages under the Indian

Tucker Act because it failed to link any breach of com-

mon-law duties to a specific statutory or regulatory obli-

gation that could be fairly interpreted as mandating

compensation for the government’s fiduciary wrongs

under this Court’s decisions in United States v. Mitchell,

445 U.S. 535 (1980) (Mitchell 1), and 463 U.S. 206 (1983)

(Mitchell IT). App. 140a-155a.

b. The Federal Circuit reversed. App. 88a-117a. It

held that, under Mitchell J and Mitchell 11, the United

States is liable in damages for a breach of fiduciary du-

ties with respect to Indian resources on land that the

United States holds in trust if the government “con-

trols” the resources under the law, because such a “level

of control” “givies] rise to a full fiduciary duty.” App.

Yla-92a. Finding “pervasive control by the United

States of the manner in which mineral leases are sought,

B..

negotiated, conditioned, and paid” under IMLA and its

regulations, App. 96a-97a, the Court held that the Tribe

stated a claim for damages for breach of “common law

fiduciary duties” of care. loyalty, and candor, and a stat-

utory duty to “obtain for the Indians the maximum re-

turn for their minerals.” App. 98a-100a.

ce. This Court granted the government’s certiorari

petition. The Tribe’s merits brief in this Court defended

the Federal Circuit’s theory of liability stemming from

“control,” arguing that the Federal Circuit correctly

held that the United States had (and breached) fiduciary

“trust duties” because, just as in Mitchell II, the govern-

ment holds the Tribe’s lands in trust and “exercises

comprehensive control and supervision over virtually

every stage of |coal] resource development” under a

network of statutes and regulations, including IMLA,

SMCRA, the Rehabilitation Act, the Indian Mineral De-

velopment Act of 1982 (IMDA), 25 U.S.C. 2101 et seq.,

and 25 U.S.C. 399. See Resp. Br. 1, 14-15, 23, 27, 30, 43

(No. 01-1375); see id. at 20-38. In light of that network

of provisions, the Tribe argued that the Secretary had “a

duty to control and supervise Navajo coal leasing for the

Navajo Nation’s benefit.” /d. at 15.

This Court reversed, concluding that “we have no

warrant from any relevant statute or regulation to con-

clude that [the Secretary’s| conduct implicated a duty

enforceable in an action for damages under the Indian

Tucker Act.” 537 U.S. at 514. The court explained that

its decisions in Mitchell I and Mitchell II “control this

case,” and that, despite the “endeavor to align this case

with Mitchell I] rather than Mitchell 1,” the “contro-

versy here falls within Mitchell ’'s domain.” /d. at 493,

507.

The Mitchell cases, the Court explained, reflect a

two-step process for determining whether a damages

claim is cognizable under the Indian Tucker Act: First,

as a threshold matter, a plaintiff must both identify a

“substantive source of law that establishes specific fidu-

ciary or other duties” and “allege that the Government

has failed faithfully to perform those duties.” 537 U.S.

at 506. That threshold “analysis must train on specific

rights-creating or duty-imposing statutory or regulatory

prescriptions.” /bid. Second, “[ijf that threshold is

passed,” the rights conferred by those provisions are

enforceable in a suit for damages only if “the relevant

source of substantive law ‘can fairly be interpreted as

mandating compensation for damages sustained as a

result of a breach of the duties the governing law im-

poses.’” /bid. (brackets and citation omitted).

While Mitchell 1] held that a damages action was

available under the Indian Tucker Act based on specific

“statutes and regulations, which clearly require|d] that

the Secretary manage Indian resources so as to gener-

ate proceeds for the Indians,” 537 U.S. at 505-506, the

Court found this case aligned with Mitchell I because,

while IMLA governed coal leasing on Indian lands, nei-

ther IMLA nor its regulations gave “the Federal Gov-

ernment full responsibility to manage Indian resources

.. . for the benefit of the Indians.” /d. at 507. Indeed,

the Court concluded, to impose fiduciary duties on the

Secretary regarding coal leasing would be “out of line”

with one of IMLA’s principal purposes—to “enhance

tribal self-determination by giving the Tribes, not the

Government, the lead role in negotiating mining leases

with third parties”—because the “ideal of Indian self-

determination is directly at odds with Secretarial con-

trol over leasing.” /d. at 508. The Court further con-

cluded that the Tribe failed to identify any “substantive

prescriptions” in a “specific statutory or regulatory pro-

vision” that the Secretary allegedly violated, either in

failing to insist upon a higher royalty rate or in his ac-

tions during the administrative appeal. /d. at 510-511,

513. The Court accordingly reversed and remanded for

further proceedings consistent with its opinion. /d. at

514.

4. On remand, the Federal Circuit construed this

Court’s decision as limited to only the three statutes

specifically discussed by the Court from among the “net-

work” of provisions on which the Tribe had relied:

IMLA, IMDA, and 25 U.S.C. 399. See App. 72a-87a.

While the Tribe conceded that it had argued to this

Court that its asserted “‘network’ of relevant statutes,

treaties, and regulations” (including SMCRA and the

Rehabilitation Act) gave rise to fiduciary duties enforce-

able in a damages action, it argued that the question

presented for which certiorari was granted “was di-

rected only at the IMLA.” App. 78a. The Tribe likewise

argued that this Court’s decision in this case was analo-

gous to Mitchell 1, which expressly left open for consid-

eration on remand arguments based on statutes not ad-

dressed in its opinion. /bid.; cf. Mitchell 1, 445 U.S. at

546 n.7. The Federal Circuit agreed and remanded to

the Court of Federal Claims. App. 80a-81a.

5. The Court of Federal Claims again entered sum-

mary judgment for the United States. App. 44a-69a.

The court explained that a “statute or regulation must

‘impose specific duties regarding the Secretary’s adjust-

ment of royalty rates for coal’” for the Tribe to recover

damages under the Indian Tucker Act, and the Tribe

again failed to “tie specific laws or regulatory provisions

to the issue at hand”—“approval of the royalty rate for

the Navajo’s coal.” App. 58a-59a, 60a, 69a. The “ele-

ments of the [Tribe’s] ‘network,’” the court concluded,

“all concern implementation of coal leasing” and do not

involve “the formation of coal leases, much less the es-

tablishment of royalty rates.” App. 58a; see App. 59a-

67a (surveying network). That conclusion, it explained,

followed from this Court’s “rationale for aligning the

Navajo’s claim with Mitchell I as opposed to Mitchell

/I” and this Court’s conclusion that “[t]he ideal of Indian

self-determination [reflected in IMLA] is directly at

odds with Secretarial control over leasing.” App. 67a-

68a (quoting 537 U.S. at 508).

6. The Federal Circuit again reversed, App. la-43a,

holding that “the Nation is entitled to judgment as a

matter of law” for two independent reasons. App. 36a.

a. The court first rejected the government’s argu-

ment that the Tribe must “allege a violation of a specific

rights-creating or duty-imposing statute or regulation,”

because, in its view, the government’s violation of “com-

mon-law trust duties” may form the basis of an Indian

Tucker Act claim under this Court’s decisions in Mitch-

ell II and United States v. White Mountain Apache

Tribe, 587 U.S. 465 (2003) (Apache). App. 36a-38a. The

court concluded that such common-law trust duties

could be judicially fashioned and enforced here based on

what it characterized as the government’s “comprehen-

sive control of the |Tribe’s| coal” resulting from a “net-

work of statutes and regulations.” App. 26a, 3la. The

court first noted that the government held the Tribe’s

reservation lands in trust and that, because the Tribe’s

“coal [is] located on that land,” it too is held in trust.

App. 26a. The court then discussed three statutes that

gave the Secretary responsibility for certain discrete

matters pertaining to the Tribe’s coal, noting that the

government had (1) “assumed coal resource planning

responsibilities” under the Rehabilitation Act, App. 27a;

(2) “assumed comprehensive control of coal mining oper-

ations” under SMCRA regulations that set environmen-

tal standards for third-party operators of tribally owned

mines and vested various responsibilities under SMCRA

in different components of the Interior Department,

App. 27a-29a; and (3) “assumed comprehensive control

of the management and collection of royalties from coal

mining” under the Federal Oil and Gas Royalty Manage-

ment Act of 1982, 30 U.S.C. 1701 et seg., App. 29a-31a.

The court emphasized that, in its view, “specific con-

trol over coal leasing” is not a prerequisite for a breach

of trust claim in this case, App. 3la, even though the

asserted breach concerned coal leasing and the royalty

rate on the lease amendments the Secretary approved.

The court instead found it sufficient that the Secretary

exercised control over other matters affecting the

Tribe’s coal in the three areas just discussed. App. 3la-

32a. The court recognized that this Court had explained

that IMLA specifically governed mineral leasing and

Lease 8580 and that IMLA “aims to enhance tribal self-

determination” in a manner directly at odds with Secre-

tarial control over coal leasing, 537 U.S. at 508. App.

35a-36a. But the court declined to follow that ruling

because, in its view, the Court had addressed the govern-

ment’s duties only under IMLA, IMDA, and 25 U.S.C.

399, and did not specifically discuss the other statutes in

the Tribe’s “asserted network.” App. 35a-36a. Having

found a basis for imposing common-law trust duties on

the Secretary with respect to coal leasing based on a

theory of “control” exercised under those other statutes,

the court held that the Secretary’s actions had breached

those duties. App. 38a.

b. The court of appeals alternatively held that the

United States was liable under the Indian Tucker Act

for violating three duties (distinct from general com-

mon-law trust duties) that it derived from the Tribe’s

“network of statutes and regulations.” App. 36a, 38a-

42a.

First, the court noted that the Rehabilitation Act

required that the Secretary keep the Tribe “informed”

of “plans pertaining to the program [that was] autho-

rized” by that Act in 1950 (which included surveys and

studies of coal resources), 25 U.S.C. 631(3) and 638, and

held that the Secretary’s actions in 1985 and 1987 con-

cerning Lease 8580 violated that obligation. App. 38a-

39a.

Second, the court observed that SMCRA regulations,

in allocating responsibilities within the Interior Depart-

ment, snecify that the BIA will “providie] representa-

tion for Indian mineral owners * * * in matters relat-

ing to surface coal mining and reclamation operations”

regulated by SMCRA, 30 C.F.R. 750.6(d), and held that

the Secretary’s actions violated that regulation. App.

38a-39a.

Third, the court concluded that SMCRA requires the

Secretary to “include and enforce terms and conditions”

in “leases issued after August 3, 1977” as requested by

an Indian Tribe, 30 U.S.C. 1300(e), and that the Secre-

tary violated that obligation by refusing to increase

Lease 8580's royalty rate to 20% as the Tribe has re-

quested. App. 38a-39a. The court acknowledged that

SMCRA “focuses on environmental protections, not roy-

alty rates.” App. 41a. But the court concluded that See-

tion 1300(e) and its companion regulation did not “con-

tain{] any subject matter limitation,” and that they ap-

—e

plied to the Tribe’s request concerning Lease 8580 even

though that lease was issued before 1977. App. 41a-42a.

REASONS FOR GRANTING THE PETITION

The Federal Circuit’s decision once again holds that

the United States is liable for up to $600 million in dam-

ages for breach of trust in connection with the Secre-

tary’s approval of the lease amendments agreed to by

the Tribe and Peabody, despite this Court’s conclusion

in Navajo that that very approval did not violate “any

relevant statute or regulation,” 537 U.S. at 514, inelud-

ing the statute directly governing the Indian mineral

lease in this case or its implementing regulations. The

decision therefore is simply foreclosed by this Court’s

earlier ruling. Review and indeed summary reversal are

warranted on that ground alone.

Even if Navajo did not preclude further litigation

based on the statutes the Tribe had previously invoked,

the Federal Circuit’s decision contravenes this Court’s

precedents, reaffirmed and reemphasized in Navajo,

establishing what a claimant must prove to render the

United States liable in damages. The Federal Circuit’s

decision—and in particular its vast expansion of Apache

while disregarding the framework of this Court’s deci-

sion rendered on the same day in this very case—dem-

onstrates the need for this Court’s review to make clear

the proper application of the important sovereign immu-

nity principles set forth in the Mitchell decisions and

reaffirmed in Navajo. The Federal Circuit’s most re-

cent decision now departs from those principles even

more dramatically than did its prior decision. Because

the Court granted review of that prior decision, a forti-

ori it should do so here.

A. This Court’s Decision In This Case Foreclosed The Basis

For Liability Adopted By The Federal Circuit

This Court’s 2003 decision in this case foreclosed the

theories of liability advanced by the Tribe and adopted

by the Federal Circuit on remand. The Tribe previously

argued to this Court that a “network” of statutes and

regulations both gave the Government comprehensive

“control” over coal mining and demonstrated that this

case was governed by Mitchell I], not Mitchell I. The

Court rejected those contentions. The Federal Circuit

was foreclosed from subsequently relying on those same

statutes and regulations to hold the United States liable.

In 2003, this Court granted certiorari to resolve

whether the Federal Circuit had “properly held that the

United States is liable * * * for breach of fiduciary

duty in connection with the Secretary’s actions concern-

ing an Indian mineral lease, without finding that the

Secretary had violated any specific statutory or regula-

tory duty established pursuant to the IMLA.” Pet. I

(No. 01-1375). The premise for the question presented

thus was that liability could not properly be imposed

under the Indian Tucker Act “without” finding a viola-

tion of a “specific statutory or regulatory duty estab-

lished pursuant to the IMLA.”

The Tribe’s merits brief argued that the govern-

ment’s duties were not limited to “specific statutory and

regulatory commands” under IMLA or other statutes

and, instead, included duties governed by “familiar trust

law standards.” Resp. Br. 30, 35 (No. 01-1375); see id.

at 30-38. It argued that Mitchell 1] stood for the propo-

sition that, “when governing statutes and regulations,

like those here, impose on the United States ‘full respon-

sibility to manage Indian resources and land for the ben-

efit of Indians,’” the government’s conduct is governed

by “common law trust standards.” /d. at 33 (quoting

Mitchell IT, 463 U.S. at 224). The Tribe accordingly ar-

gued the government “exercises comprehensive control

and supervision over virtually every stage of [coal] re-

source development” under a network of statutes and

regulations. /d. at 14-15; see id. at 1, 20-38.

The Tribe not only argued that IMLA governs coal

leasing, but also that SMCRA’s Indian lands section (30

U.S.C. 1300) and its accompanying regulations (30

C.F.R. Pt. 750) gave the government control over “all

stages of Indian coal surface mining” in its role as

“trustee of the natural resources of the Indian tribes,”

and similarly argued that the Rehabilitation Act re-

quired the Secretary to act in the best interest of the

Tribe (25 U.S.C. 631, 635). See Resp. Br. 23, 27, 30, 43

(No. 01-1375). In fact, the Tribe’s brief in this Court

cited every statutory scheme later relied upon by the

Federal Circuit on remand to find the United States

liable. Compare, e.g., id. at 1, 3 (listing network of stat-

utes and regulations), with App. 16a-17a (listing network

relied upon on remand).

This Court, however, concluded that despite the “en-

deavor to align this case with Mitchell I] rather than

Mitchell I,” the “controversy here falls within Mitchell

l’s domain” because the Secretary had “no obligations

resembling the detailed fiduciary responsibilities that

Mitchell I] found adequate to support a claim for money

damages.” 537 U.S. at 493, 507. Moreover, the Court

agreed with the government that duties established un-

der common-law trust principles could not form a basis

for Indian Tucker Act claims, holding that the Tribe

must identify “specific rights-creating or duty-imposing

statutory or regulatory prescriptions” that establish the

“specific fiduciary or other duties” that the government

allegedly has failed to fulfill. /d. at 506 (emphasis

added).

The Court accordingly examined the statutes and

regulations cited by the Tribe that were even arguably

relevant to the Secretary’s conduct concerning approval

of lease amendments containing new royalty rates and

concluded that they did not establish any “specific fidu-

ciary or other dut[y]” that the Secretary might have

violated. 537 U.S. at 506-514. The Court explained that

IMLA and its implementing regulations (which specifi-

cally govern tribal coal leasing) “do not assign to the

Secretary managerial control over coal leasing” and that

“imposing fiduciary duties on the Government here

would be out of line with one of the statute’s principal

purposes,” namely, “to enhance tribal self-determination

by giving Tribes, not the Government, the lead role in

negotiating leases with third parties.” /d. at 508; see id.

at 506-508, 510-513. The Court similarly addressed the

other components of the Tribe’s “network” that ad-

dressed coal leasing or similar arrangements for selling

Indian coal and concluded that neither 25 U.S.C. 399 nor

IMDA governed the lease in this case. 537 U.S. at 509.

To be sure, the Court did not specifically address by

name the other statutes and regulations that the Tribe

cited as components of its asserted network. But that is

no doubt because those other statutes had nothing to do

with approval of royalty terms in coal leasing, but

rather, as we explain more fully below, concern such

disparate subjects as the Secretary’s regulation of oper-

ators of surface coal mines for environmental purposes

and a development program authorizing (among other

things) surveys and studies of coal resources that ended

decades before the events in this case. But had the

Court believed that the Tribe’s arguments based on such

unrelated statutes were unaffected by the Court’s dispo-

sition of the case, it presumably would have indicated, as

did the Court in Mitchell I, that issues concerning those

statues remained viable for further consideration on

remand. Cf. Mitchell I, 445 U.S. at 546 n.7. Instead, the

Court concluded its opinion in this case by stating that

“({hjowever one might appraise the Secretary’s interven-

tion in this case, we have no warrant from any relevant

statute or regulation to conclude that his conduct impli-

cated a duty enforceable in an action for damages under

the Indian Tucker Act.” Navajo, 537 U.S. at 514. That

determination renders the statutes in the Tribe’s net-

work either insufficient to implicate an enforceable duty

or wholly irrelevant. Either way, the Court’s disposition

fully resolved the Tribe’s claims based on the statutes in

its proffered “network” and common-law trust duties

derived from the government’s asserted control over the

Tribe’s coal, and it thereby foreclosed renewal of those

same claims on remand.

The Federal Circuit nevertheless held that the Tribe

could re-raise identical trust arguments based on the

same statutes presented to this Court—minus the three

most relevant statutes that this Court found necessary

to address by name. That departure from this Court’s

ruling in this very case is extraordinary, and review

should be granted on that ground alone. Indeed, given

the starkness of that departure, summary reversal

would be appropriate.

B. The Court of Appeals’ Ruling, Even If Not Completely

Foreclosed By Navajo, Is In Any Event Flatly Inconsis-

tent With Navajo And This Court’s Decisions Forming

The Basis For Navajo

Even if this Court’s mandate did not in itself abso-

lutely foreclose the Federal Circuit’s reinstatement of

liability, that court’s rationale is flatly inconsistent with

this Court’s decision in Navajo and the precedents on

which Navajo is based. Under this Court’s precedents,

damage claims under the Indian Tucker Act are action-

able only f they allege violations of a specific constitu-

tional, statutory, or regulatory provision that may be

fairly read as mandating a remedy in money damages.

The court of appeals therefore plainly erred in conclud-

ing that Indian Tucker Act claims may be based on vio-

lations of common-law trust principles divorced from

any specific rights-creating or duty-imposing statutory

or regulatory provisions.

a. “It is axiomatic that the United States may not be

sued without its consent and that the existence of con-

sent is a prerequisite for jurisdiction.” Navajo, 537 U.S.

at 502 (quoting Mitchell 17, 463 U.S. at 212). Moreover,

a waiver of sovereign immunity must be “unequivocally

expressed in statutory text,” Lane v. Pera, 518 U.S. 187,

192 (1996), and, where Congress has waived immunity,

the “scope” of that waiver must be “strictly construed

* * * in favor of the sovereign,” ‘bid., and “not ‘en-

large{d| . . . beyond what the language requires.’”

United States Dep't of Energy v. Ohio, 503 U.S. 607, 615

(1992) (citation omitted); see Department of Army v.

Blue Fow, Inc., 525 U.S. 255, 261 (1999).

The Tucker Act waives the United States’ immunity

from suit by granting the Court of Federal Claims juris-

diction over—

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)(1). The Tucker Act’s “companion stat-

ute,” the Indian Tucker Act, “confers a like waiver for

Indian tribal claims that ‘otherwise would be cognizable

in the Court of Federal Claims if the claimant were not

an Indian tribe.’” Apache, 537 U.S. at 472 (quoting 28

U.S.C. 1505); see Navajo, 537 U.S. at 502-503 & n.10;

Mitchell 1, 445 U.S. at 540 (acts provide “same access”

to relief).

While the text of the Tucker and Indian Tucker Acts

authorize damage claims “founded * * * upon” (28

U.S.C. 1491(a)(1)) or “arising under” (28 U.S.C. 1505)

the Constitution or a federal statute or regulation, “[n|]ot

every claim invoking the Constitution, a federal statute,

or a regulation is cognizable.” Mitchell 1], 463 U.S. at

216. Instead, “[t]he claim must be one for money dam-

ages against the United States, and the claimant must

demonstrate that the source of substantive law he relies

upon ‘can fairly be interpreted as mandating compensa-

tion by the Federal Government for the damage sus-

tained.’” /d. at 216-217 (citations omitted); accord Na-

vajo, 537 U.S. at 503 (quoting Mitchell 11, 463 U.S. at

218); Apache, 537 U.S. at 472.

A plaintiff asserting a non-contract claim under the

Tucker or Indian Tucker Act must therefore satisfy two

distinct requirements. First, the plaintiff must assert a

claim of right based on a violation of “the Constitution,

or any Act of Congress or any [federal] regulation” in

order to fall within the literal terms of Congress’s

waiver of sovereign immunity. See Mitchell IT, 463 U.S.

at 216 (quoting 28 U.S.C. 1491l(a)). That “threshold”

showing for non-constitutional claims must identify

“specific rights-creating or duty-imposing statutory or

regulatory prescriptions” that establish the “specific

fiduciary or other duties” that the government allegedly

has failed to fulfill. Navajo, 537 U.S. at 506 (emphasis

added).

Second, “[iJf that threshold is passed,” the plaintiff

must show that “the relevant source of substantive law”

whose violation forms the basis of his claim—here, a

statute or regulation—“can fairly be interpreted as man-

dating compensation for damages sustained as a result

of a breach of the duties the governing law imposes.”

Navajo, 537 U.S. at 506 (brackets and citation omitted);

see United States v. Testan, 424 U.S. 392, 401-402

(1976).

b. The Federal Circuit fundamentally misapplied

this Court’s decisions in holding that the Tribe need not

“allege a violation of a specific rights-creating or duty-

imposing statute or regulation” and may instead base an

Indian Tucker Act claim on an alleged violation of

“common-law trust duties.” App. 36a-37a. Indeed, as

we have explained, this Court’s decision in this very case

reaffirmed that the Indian Tucker Act requires the

Tribe, at the “threshold” step, to “identify a substantive

source of law that establishes specific fiduciary or other

duties” allegedly breached by the government and, for

that reason, the proper “analysis must train on specific

rights-creating or duty-imposing statutory or regula-

tory prescriptions” establishing those specific duties.

Navajo, 537 U.S. at 506 (emphasis added).

If that threshold is satisfied, general principles from

the common law of trusts can then be relevant at the

second step of the analysis under this Court’s decisions

in determining whether the source of substantive law

that imposes specific duties may also fairly be inter-

preted as mandating monetary relief for its violation.

But such common-law principles cannot serve as a sub-

stitute for identifying specific statutory or regulatory

duties at the first step of the analysis.

The Federal Circuit based its contrary conclusion on

its belief that this Court “rejected [that reading of the

Indian Tucker Act] in Apache” and that Apache demon-

strates that “elaborate” governmental control will itself

give rise to common-law trust duties whose violation is

actionable under the Act. App. 36a-37a. In so holding,

the Federal Circuit fundamentally misapplied this

Court’s precedents and ignored the controlling frame-

work in this Court’s decision in this very case, which

was decided on the same day as Apache.

While the Federal Circuit concluded that Apache

“found * * * that «ommon-law duties helped to define

the ‘contours of the United States’ fiduciary responsibili-

ties,” App. 37a (quoting Apache, 537 U.S. at 474), the

quoted text from Apache, when read in context, is to the

contrary. Apache explained that, in Mitchell 11, the

Court found that “statutes and regulations specifically

addressing the management of timber on allotted lands

raised the fair implication that the substantive obliga-

tions imposed on the United States by those statutes

and regulations were enforceable by damages.” Apa-

che, 537 U.S. at 473-474 (emphasis added). The Court

then continued that because “the statutes and regula-

tions lin Mitchell 11| gave the United States ‘full re-

sponsibility to manage Indian resources and land for the

benefit of the Indians,’ we held that they”—that is, the

specific statutes and regulations, not common law

principles—“define|d] . . . [the] contours of the United

States’ fiduciary responsibilities.” /d. at 474 (emphasis

added). Indeed, Apache explained that such a “source of

law was needed to provide focus for the trust relation-

ship” in order “(tlo find a specific duty” owed by the

government and, only after “that focus was provided,”

should “general trust law [be] considered in drawing the

inference that Congress intended damages to remedy a

breach of [that] obligation.” /d. at 477.

The Court in Apache confronted a single and unique

statute that directed that the former Fort Apache Mili-

tary Reservation be “held by the United States in trust

for the White Mountain Apache Tribe, subject to the

right of the Secretary of the Interior to use any part of

the land and improvements for administrative or school

purposes.” Apache, 537 U.S. at 469 (quoting Act of Mar.

18, 1960 (1960 Act), Pub. L. No. 86-392, 74 Stat. 8). The

Court concluded that the 1960 Act employed the term

“trust” as a term of art and that, when the Secretary

exercised his related authority “to make direct use of

portions of the trust corpus” for the government’s own

purposes, the 1960 Act itself imposed a statutory duty to

preserve the trust corpus triggered by the “actual use”

and “daily occupation” of the government. See id. at

475; see also id. at 480 (Ginsburg, J., concurring). Thus,

the government’s duty derived directly from the statute

itself, which specifically contemplated the self-inter-

ested use of the trust corpus by the Secretary. See ?d.

at 479-480 (Ginsburg, J., concurring) (“threshold” re-

quirement of “a substantive source of law that estab-

lishes specifie fiduciary or other duties” is satisfied by

text of 1960 Act (quoting Navajo, 537 U.S. at 506)).

As this Court recognized both in Navajo and Apache,

the Court in Mitchell I] was similarly careful to ground

the duties at issue in that case in specific statutory and

regulatory prescriptions. Applying the two-step analy-

sis reaffirmed by Navajo, 537 U.S. at 506, the Court in

Part III.A of its opinion (463 U.S. at 219-223) first exam-

ined the “Acts of Congress and executive department

regulations” on which the plaintiffs “based their money

claims.” Jd. at 219. While those claims were described

in aggregate as “alleged breaches of trust in connection

with [the government’s] management of forest resources

on allotted [Indian] lands,” 2d. at 207, each of the plain-

tiffs’ precise claims tracked a specific duty separately

set forth in one of the statutes or regulations governing

federal Indian timber management. See id. at 210 (de-

scribing claims); id. at 209, 211, 219-223 & nn.23-28 (dis-

cussing governmental duties under statutes and regula-

tions on which the damages claims were predicated).”

Consequently, the Court’s discussion of those duties

focused on the specific obligations imposed by the stat-

utes and regulations at issue and did not invoke

common-law trust principles to define the applicable

duties. See id. at 219-223.

Mitchell II’s discussion of trust principles was in-

stead limited to Part III.B of the opinion (463 U.S. at

* See also, ¢.g., 25 U.S.C. 406(a) (proceeds from timber sales “shall

be paid to the owner or owners or disposed of for their benefit”); 25

U.S.C. 413 (administrative fees must be “reasonable”); 25 U.S.C. 466

(Secretary must manage Indian forestry units “on the principle of

sustained-yield management”); 25 C.F.R. 163.4 (1985) (requiring

sustained-yield management); 25 C.F.R. 163.7(¢)2) (1985) (timber

“shall be appraised” and sold at not less than appraised value, except as

authorized); 25 C.F.R. 168.18 (1985) (administrative fees must be

“reasonable”).

224-228), which addressed whether the relevant statutes

and regulations could in turn “fairly be interpreted as

mandating compensation for damages sustained as a

result of the breach of the duties they impose” (id. at

219). Because a trustee normally is “accountable in

damages for breaches of trust,” id. at 226, the Court

concluded that statutes and regulations that give the

government “full responsibility” and a “fiduciary obliga-

tion||” to manage and operate the trust corpus (timber,

lands, and monetary proceeds) for the sole “benefit of

the Indians” in order to “generate proceeds for the Indi-

ans” may “fairly be interpreted as mandating compensa-

tion” for a breach. /d. at 224-227. This limited use of

trust principles thus assesses whether statutes or regu-

lations that impose specific fiduciary duties may, in ad-

dition, be fairly interpreted as money mandating.

ce. The Federal Circuit flipped this analysis on its

head, concluding that governmental functions concern-

ing tribal coal in other areas justify imposing new and

additional duties concerning approval of royalty rates

based on general common-law trust principles. The

Federal Circuit’s concept of federal “control” sufficient

to impose such duties, moreover, bears no relationship

to the actual, managerial control exercised by the gov-

ernment over tribal assets pursuant to the specific statu-

tory and regulatory prescriptions in Mitchell 1]. Those

statutes and regulations required that the government

directly make decisions regarding the sale, manage-

ment, and harvesting of tribal timber resources for the

sole benefit of the Indian owners with “[v]irtually every

stage of the process * * * under federal control.”

Mitchell 11, 463 U.S. at 222; see id. at 220-223 & nn.23-

28. In Apache, the government itself exclusively occu-

pied and exercised plenary control over land and im-

provements pursuant to an express statutory trust and

used that property for its own purposes. See 537 U.S. at

469; see id. at 481 (Ginsburg, J, concurring) (1960 Act

conferred “plenary control” on government as “sole

manager and trustee”). As this Court explained in Na-

vajo, there are no remotely similar provisions vesting

the government with actual managerial control over the

coal leasing decisions at issue in this case. To the con-

trary, the thrust of the most relevant statute, IMLA, is

to confer control on the Tribes. Navajo, 537 U.S. at 508.

The Federal Circuit held that the government exer-

cised “comprehensive control” over coal on the Tribe’s

land because the government played a role in statutes

addressed to three discrete coal-related areas: the gov-

ernment conducted surveys and studies of coal re-

sources on Navajo land under a program that was autho-

rized by the Rehabilitation Act in 1950 and ended by

1964 (see p. 29, infra); acted as an environmental regu-

lator of third-party operators of tribal surface mines

pursuant to SMCRA and its implementing regulations;

and collected mineral lease royalties on behalf of Tribes.

App. 3la; see App. 27a-3la. Those #etivities, however,

plainly cannot be understood as conferring managerial

control over the leasing and royalty-rate decisions at

issue in this case. Those decisions were instead gov-

erned by IMLA, which, as this Court held in Navajo, did

not impose any specific duties on the Secretary with

respect to the actions challenged in this case.

The Federal Circuit, however, concluded that the

asserted governmental “control” of tribal coal supported

a “breach of trust claim” even though the government

did not exercise “specific control of coal leasing,” rea-

soning that governmental “control over the greater (e.g.,

coal resources)” implies “control over the lesser (e.g.,

the leasing of such coal).” App. 3la-32a. This conclusion

not only runs afoul of the normal principle that the spe-

cific controls the general, Morales v. TWA, 504 U.S. 374,

384 (1992), but it also wrongly looks to implicit congres-

sional direction on an issue that Congress addressed

explicitly in IMLA. Needless to say, the Federal Cir-

cuit’s analysis cannot be squared with this Court’s con-

clusion in this case that the more specific and explicit

IMLA, which directly governs Lease 8580, “aims to en-

hance tribal self-determination by giving the Tribes, not

the Government, the lead role in negotiating mining

leases” in a manner “directly at odds with Secretarial

control over leasing” and that, consequently, “imposing

fiduciary duties on the Government here would be out of

line with one of the statute’s principal purposes.” Na-

vajo, 537 U.S. at 508 (emphasis added).

2. The Federal Circuit’s alternative holding that the

United States is liable for up to $600 million for viola-

tions of three statutory or regulatory provisions of the

Rehabilitation Act and SMCRA is plainly incorrect.

Neither statute applies to the Secretary’s actions in his

case or imposes money-mandating obligations cogniza-

ble under the Indian Tucker Act.

a. The Rehabilitation Act did not impose any obliga-

tion to keep the Tribe informed concerning the Secre-

tary’s decisions regarding Lease 8580. Cf. App. 38a-39a.

That Act provides that the Tribe “shall be kept informed

and afforded opportunity to consider from their incep-

tion plans pertaining to the program authorized by [the

Act].” 25 U.S.C. 638. While the program authorized in

1950 included $500,000 for “surveys and studies” of coal

and other resources, 25 U.S.C. 631(3), Congress directed

the Secretary to take steps needed to achieve “comple-

tion of the program” by 1960, 25 U.S.C. 632; the pro-

gram’s “[sJurveys and studies” were promptly executed,

see H.R. Rep. No. 2455, supra, at 4, 7; and the entire

“Navajo-Hopi rehabilitation program” was completed

around 1964, S. Rep. No. 11, supra, at 1, decades before

the Secretary’s actions in this case. Even if the program

had been ongoing in 1985, the Act merely required that

the Tribe be kept informed of plans pertaining to the

program authorized by the Act. While plans concerning

surveys and studies of coal resources might be covered,

the adjustment of coal lease terms plainly are not. As

this Court explained in Navajo, neither IMLA, which

governed approval of lease terms, nor the Department’s

regulations specifically governing administrative ap-

peals imposed any procedural duty that was violated in

this case. Moreover, even if the Secretary had violated

a procedural notice obligation in handling Peabody’s

administrative appeal, that violation would not entitle

the Tribe to damages under the Indian Tucker Act. Pro-

cedural duties are in the nature of due process

protections, and even constitutional procedural due pro-

cess violations do not give rise to a damages claim under

the Act. See, e.g., Testan, 424 U.S. at 403; United States

v. Hopkins, 427 U.S. 123, 130 (1976) (per curiam).

b. The Federal Circuit’s conclusion (App. 38a-39a)

that the Secretary violated a regulatory duty to

“providije| representation for Indian mineral owners

* * * in matters relating to surface coal mining and

reclamation operations,” 30 C.F.R. 750.6(d)(1), is equally

untenable. By its own terms, that provision concerns

the “regulation of surface coal mining and reclamation

operations” by the Department of Interior, 30 C.F.R.

750.1, 750.6(d)(1) (emphasis added), and describes the

role of the BIA within the Interior Department, not the

Secretary as head of the Department, in representing

tribal interests in consultations with the Office of Sur-

face Mining concerning OSM’s regulatory actions. 30

C.F.R. 750.6(a)(1)-(2), (d)(1)-(2). The regulation thus

merely “describes a procedural arrangement by which

the BIA [and] OSM * * * coordinate and execute their

respective functions and responsibility” under SMCRA;

it neither affects “the role of tribes as lessors” nor “the

statutory or regulatory prerogatives of the Secretary

with respect to Indian lands.” 49 Fed. Reg. 38,467

(1984).

c. Finally, the court’s conclusion that SMCRA re-

quired the Secretary to adjust the royalty rate as re-

quested by the Tribe (App. 39a-40a) is deeply flawed on

multiple levels. SMCRA requires that the Secretary

incorporate into covered Indian surface coal mining

leases the “requirements” of certain SMCRA statutory

provisions concerning performance standards and re-

quirements for mining operations. 30 U.S.C. 1300(d).

SMCRA further provides that, “in addition to those re-

quired” terms and conditions, the Secretary shall “in-

clude and enforce terms and conditions as may be re-

quested by the Indian Tribe.” 30 U.S.C. 1300(e). While

SMCRA does not expressly state that the “addition|al]”

terms and conditions requested by a Tribe must relate

to regulation of mining operations under SMCRA, that

limitation is manifest from the structure and purpose of

SMCRA. If there were any doubi on that score, the Sec-

retary has authoritatively construed the requirements

of Section 1300(e) as not “encompass|ing] terms and

conditions unrelated to SMCRA,” 54 Fed. Reg. 22,187

(1989), and has codified that interpretation in regulation,

25 C.F.R. 200.11(b). That interpretation is entitled to

deference under Chevron U.S.A. Inc. v. NRDC, 467 U.S.

837 (1984), as a reasonable construction of Section

1300(e).

Indeed, the Tribe has itself conceded that “Lease

8580 and the lease amendments are governed only by

the IMLA.” Resp. Fed. Cl. Mem. in Supp. of Mot. to

Alter or Amend J. 11 (filed Feb. 18, 2000) (emphasis

added). If the Secretary were required to accept the

Tribe’s requested royalty rate under Section 1300(e),

the entire adjudicatory process of obtaining Secretarial

adjustment of the rate at issue in this case under IMLA

would have been a meaningless exercise, since the out-

come would have been compelled by the Tribe’s re-

quest."

In short, the statutory and regulatory provisions that

the Federal Circuit found to be violated by the Secre-

tary have no application to lease approvals or royalty

rates and furnish no conceivable basis for an Indian

Tucker Act claim. IMLA is the specific statute that ad-

dresses the matters at the heart of this lawsuit. That is

why it was the focus of this Court’s earlier decision. The

ease with which the Federal Circuit nonetheless held

that statutory provisions governing other subjects im-

pose duties specifically with respect to lease royalties

and procedures for considering lease amendments—

imposing liability for up to $600 million—underscores

how far the Federal Circuit has strayed from this

Court’s decision in this very case and the long-settled

principles on which it was based.

* The Federal Circuit’s interpretation of Section 1300(e) would

substantially interfere with IMLA’s statutory approval process, 25

U.S.C. 396a, and require that the Secretary “include and enforce” the

terms and conditions requested by a Tribe into surface coal mining

leases.

C. The Court Of Appeals’ Decision Threatens Serious Ad-

verse Consequences For The Government

The practical implications of the court of appeals’

decision are significant. The Tribe’s damages claim in

this case alone totals $600 million. See also Hopi Tribe

v. United States, No. 1:00-cev-00217 (Fed. Cl.) (virtually

identical lawsuit challenging Secretary Hodel’s actions

regarding Lease 8580 and its impact on Navajo-Hopi

lease negotiations). The decision below will encourage

the filing of damages claims against the United States

for breach of trust with respect to the Secretary’s ap-

proval of Indian mineral leases with private entities

based on assertions of common-law fiduciary duties that

are not tied to any statutory or regulatory prescription.

Indeed, the Federal Circuit’s reasoning presumably

would apply whenever the government has a general

trust relationship with a Tribe and (a) has discrete stat-

utory responsibilities with respect to tribal resources or

(b) acts in a regulatory capacity to oversee (“control”)

third-party activities on Indian lands under environmen-

tal or other statutes.

The important and recurring nature of the basic

question presented by this case is underscored not only

by the fact that the Court of Federal Claims has already

applied the decision in this case in concluding that statu-

tory trust provisions may be governed “by terms estab-

lished in the statute or by general trust law,” Wolfchild

v. United States, 78 Fed. Cl. 472, 483 & n.15 (2007) (em-

phasis added), appeal pending, No. 2008-5018 (Fed.

Cir.), but also by the existence of 55 other pending law-

suits involving 58 Tribes and thousands of individuals

which will likely present similar issues.

Beyond its impact on damage claims that are already

pending, the decision below introduces grave uncer-

tainty into the Interior Department’s day-to-day activi-

ties carried out by thousands of Departmental employ-

ees nationwide. The decision improperly superimposes

on the substantive and procedural framework establish-

ed under applicable statutes and regulations a broad and

amorphous set of trust principles whose precise content

cannot be known in any particular context in advance.

Under the Tucker Acts, the Federal Circuit is the

only court of appeals that has jurisdiction to consider

claims against the United States for money damages for

violation of a statute or implementing regulation. It is

therefore critical for this Court to review the Federal

Circuit’s renewed departure from this Court’s deci-

sions—including its decision in this very case—with re-

spect to the necessary predicate that a Tribe must show

to bring a damages claim against the United States un-

der the Tucker Act.

CONCLUSION

The petition for a writ of certiorari should be gran-

ted. The Court may wish to consider summary reversal

of the judgment below.

Respectfully submitted.

PAUL D. CLEMENT

Solicitor General

RONALD J. TENPAS

Assistant Attorney General

EDWIN S. KNEEDLER

Deputy Solicitor General

ANTHONY A. YANG

Assistant to the Solicitor

General

ELIZABETH A. PETERSON

Attorney

MAY 2008

APPENDIA

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es ale _

se ~ e* , i ae 7s

Pi f) f 7} hs } Q caeas ~ Osos

No. . : ‘ e+ @e ~/ aieel\ ti

Jn the Supreme Court of the Gnited States

UNITED STATES OF AMERICA, PETITIONER

Vv.

NAVAJO NATION

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE FEDERAL CIRCUIT

APPENDIX TO THE

PETITION FOR A WRIT OF CERTIORARI

PAUL D. CLEMENT

Solicitor General

Counsel of Record

RONALD J. TENPAS

Assistant Attorney General

EDWIN S. KNEEDLER

Deputy Solicitor General

ANTHONY A. YANG

Assistant to the Solicitor

General

ELIZABETH A. PETERSON

Attorney

Department of Justice

Washington, D.C. 20530-0001

(202) 514-2217

Appendix A

Appendix B

Appendix C

Appendix D

Appendix E

Appendix F

Appendix G

TABLE OF CONTENTS

Page

Court of appeals opinion (Sept. 13,

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Court of Federal Claims opinion

I tet tue cweeese tee 44a

Court of appeals order (Jan. 14,

Dc peakaeeeeeseukewkbséens-o0e 70a

Court of appeals opinion (Oct. 24,

kates taedbedideveaensanlen sae 72a

Court of appeals opinion (Aug. 10,

cide khereendéd 6béesheene ane 88a

Court of Federal Claims opinion

EE icbduewecoveteievnas 118a

Statutes and regulations .......... 167a

(1)

APPENDIX A

UNITED STATES COURT OF APPEALS

FOR THE FEDERAL CIRCUIT

No. 2006-5059

THE NAVAJO NATION, PLAINTIFF-APPELLANT

UNITED STATES, DEFENDANT-APPELLEE

Filed: Sept. 13, 2007

OPINION

Before: GAJARSA, Circuit Judge, PLAGER, Senior Cir-

cuit Judge, and MOORE, Circuit Judge.

GAJARSA, Circuit Judge.

The threshold question in this case is whether the

Navajo Nation (“Nation” or “Tribe”) has a cognizable

money-mandating claim under 28 U.S.C. § 1505, known

as the Indian Tucker Act, against the United States for

a breach of trust in a lease of the Nation’s lands for coal

mining to Peabody Coal Co. (“Peabody”). Only if there

is such a claim, may we evaluate whether the United

States breached its trust duties based on the parties’

cross-motions for summary judgment.

In United States v. Navajo Nation (“Navajo III”),

537 U.S. 488, 123 S. Ct. 1079, 155 L. Ed. 2d 60 (2003),

(la)

the Supreme Court held that the Act of May 11, 1938

(“Indian Mineral Leasing Act of 1938” or “IMLA of

1938”), ch. 198, 52 Stat. 347, 25 U.S.C. § 396a-g, and its

implementing regulations do not constitute the substan-

tive source of law required to establish such a claim and

remanded for further proceedings consistent with its

opinion. Navajo [1], 5387 U.S. at 514, 123 S. Ct. 1079.

Because Navajo /I/] did not address whether the net-

work of other statutes and regulations asserted by the

Nation provides the required substantive source of law,

we remanded to the Court of Federal Claims to consider

the question. Navajo Nation v. United States (“Navajo

IV”), 347 F.3d 1327, 1332 (Fed. Cir. 2003). On remand,

the Court of Federal Claims found that the Nation’s as-

serted network of other statutes and regulations failed

“to establish a money-mandating trust in the area of

royalty rates.” Navajo Nation v. United States (“Na-

vajo V”), 68 Fed. Cl. 805, 815 (2005). The Nation ap-

pealed.

The Supreme Court stated in United States v. White

Mountain Apache Tribe, 537 U.S. 465, 123 S. Ct. 1126,

155 L. Ed. 2d 40 (2003), that “[iJt is enough . . . thata

statute creating a[n Indian] Tucker Act right be reason-

ably amenable to the reading that it mandates a right of

recovery in damages. While the premise to a[n Indian]

Tucker Act claim will not be ‘lightly inferred,’ a fair in-

ference will do.” /d. at 473, 123 S. Ct. 1126 (citation

omitted). Because the governing law establishes such a

fair inference in this case and because the undisputed

facts as determined by the Court of Federal Claims

demonstrate that the government breached its trust

duties, we reverse the decision of the Court of Federal

Claims and remand for further proceedings consistent

with this opinion.

A. Background Facts

The facts of this case are undisputed and have been

detailed by the Court of Federal Claims in Navajo Na-

tion v. United States (“Navajo 1”), 46 Fed. Cl. 217,

221-24 (2000), this court in Navajo Nation v. United

States (“Navajo II”), 263 F.3d 1325, 1327-28 (Fed. Cir.

2001), and the Supreme Court in Navajo II], 537 U.S. at

495-500, 123 S. Ct. 1079. Because of the prior detail, we

provide only a brief factual summary here.

The Navajo reservation is the largest Indian reserva-

tion in the United States and spans parts of Arizona,

New Mexico, and Utah. The United States holds the

Nation’s reservation iands in trust for the Nation pursu-

ant to a treaty, an executive order, and two Congressio-

nal acts. See infra Part III.D.1. Over the past century,

large coal deposits have been discovered on these lands.

Navajo ITT, 537 U.S. at 495, 123 S. Ct. 1079.

In 1964, the Nation and the predecessor of Peabody’

executed Lease 14-20-0603-8580 (“Lease 8580”), which

became effective when the Secretary of the Department

of the Interior approved it that year. Navajo /, 46 Fed.

Cl. at 221. Lease 8580 granted Peabody the “exclusive

right and license to prospect, mine, and strip” 24,858

acres of the Nation’s reservation in Arizona for coal. In

return, the lease established royalties of not more than

37.5 cents per ton. The lease also provided, however,

that “the royalty provisions of this lease are subject to

reasonable adjustment by the Secretary of the Interior

' Hereinafter, we refer to Peabody and its predecessor as “Pea-

body.”

. at the end of twenty years from the effective date

of this lease.”

As the twenty-year anniversary approached in 1984,

it became apparent that the 37.5 cents per ton maximum

royalty was “by any measure, an inequitable deal” for

the Nation and was “substantially lower” than the 12.5%

minimum royalty set by Congress in 1977 for coal mined

on federal lands. Navajo I, 46 Fed. Cl. at 222; Navajo

III, 537 U.S. at 496, 123 S. Ct. 1079. In March 1984, the

Nation wrote the Secretary of the Interior, William

Clark, asking him to make a reasonable adjustment of

the royalty rate as provided by Lease 8580. In June

1984, after considering the “reports and recommenda-

tions from the Bureau’s Navajo Area and Energy and

Mineral Resources Offices, the Bureau of Mines and oth-

ers,” the Area Director of the Bureau of Indian Affairs

for the Navajo Area, pursuant to authority delegated by

the Secretary, issued a final decision adjusting the roy-

alty rate of Lease 8580 to 20% of gross proceeds. Na-

vajo [11,537 U.S. at 496, 123 S. Ct. 1079.

In July 1984, Peabody filed an administrative appeal,

which was

referred to the Deputy Assistant Secretary for In-

dian Affairs, John Fritz, then acting as both Commis-

sioner of Indian Affairs and Assistant Secretary of

Indian Affairs. In March 1985, Fritz permitted Pea-

body to supplement its brief and requested addi-

tional cost, revenue, and investment data. He there-

after appeared ready to reject Peabody’s appeal. By

June 1985, both Peabody and the Tribe anticipated

that an announcement favorable to the Tribe was

imminent.

Navajo IIIT, 587 U.S. at 496, 123 S. Ct. 1079 (citations

omitted).

In July 1985, Peabody wrote a letter to the new Sec-

retary of the Interior, Donald Hodel, seeking either to

postpone the decision reviewing the royalty adjustment

or to issue a ruling in Peabody’s favor. The Nation re-

ceived a copy of the letter and submitted its own to Sec-

retary Hodel, “urging the Secretary to reject Peabody’s

request and to secure the Department’s prompt release

of a decision in the Tribe’s favor.” Jd. at 497, 123 S. Ct.

1079 (citations omitted).

Later that month, Peabody retained Stanley Hulett,

who was described in a Peabody company memorandum

as “a former upper level Department of Interior em-

ployee” believed to have “influence with the current Sec-

retary of Interior (Don Hodel).” The government con-

ceded in this case that Hulett was “a former aide and

friend of Secretary Hodel.” See Navajo I//] U.S. Br.,

2002 WL 1968199, Hulett met with the Secretary with-

out a representative of the Nation being present, and

the Nation never received notification of the meeting.

Navajo III, 537 U.S. at 497, 123 S. Ct. 1079. “On or

shortly after the date of the ex parte meeting, Secretary

Hodel signed a memorandum prepared by Peabody,

making only one insignificant change in the company’s

draft.” Navajo J, 46 Fed. Cl. at 222-23. Secretary Hodel

addressed to Fritz the memorandum, which stated in

part:

I suggest that you inform the involved parties that a

decision on this appeal is not imminent and urge

them to continue with efforts to resolve this matter

in a mutually agreeable fashion.

I wish to assure you, however, that this memoran-

dum is not intended as a determination of the merits

of the arguments of the parties with respect to the

issues which are subject to the appeal. If it becomes

inevitable that such a determination must be made

by the Department, then we can discuss it at that

time.

The Nation was not advised of this memorandum but

“learned that someone from Washington had urged a

return to the bargaining table. Facing severe economic

pressure, the Tribe resumed negotiations with Peabody

in August 1985.” Navajo [1], 587 U.S. at 498, 123 S. Ct.

1079 (quotation marks and citations omitted).

In September 1985, Peabody and the Nation reached

a tentative settlement agreement on a package of

amendments. The amendments were approved by the

Navajo Tribal Council in August 1987, signed by the

parties in a final agreement in November 1987, and ap-

proved by Secretary Hodel in December 1987. /d. at

500, 123 S. Ct. 1079. The amended lease raised the roy-

alty rate to 12.5% for Lease 8580. In addition, the

amendments raised the royalty rate for two other exist-

ing leases, which did not contain Lease 8580’s reason-

able adjustment provision, resolved a broad range of

issues between Peabody and the Nation, and added 90

million tons of coal to the 200 million tons originally

leased from the Nation’s reservation lands in Arizona.

The amendments acknowledged that the parties could

have executed a separate lease or leases to mine the ad-

ditional coal, but instead, decided to amend the lease “in

consideration for various additional undertakings of Pea-

body.” Without its exhibits, the amendments numbered

more pages than the original Lease 8580.

B. Procedural History

In 1993, the Nation brought suit seeking $600 million

in damages against the United States in the Court of

Federal Claims. Navajo /, 46 Fed. Cl. at 225. The first

amended complaint asserted that the “leasing of coal of

the Navajo Nation is subject to a comprehensive statu-

tory and regulatory scheme of the United States”; that

the government “claimed and exercised broad authority

and control over the leasing of coal it holds in trust for

the Navajo Nation”; and that the government violated

its statutory and fiduciary duties to the Nation “by,

inter alia, approving the amendments to the Lease on

December 14, 1987, causing economic loss to the Navajo

Nation, a diminution of the value of the trust res, and

harm to the sovereignty of the Navajo Nation.”

On cross-motions for summary judgment on the issue

of liability, while finding “that the United States violated

the most fundamental fiduciary duties of care, loyalty

and candor,” the Court of Federal Claims held that the

Nation “failed to present statutory authority which can

be fairly interpreted as mandating compensation for the

government’s fiduciary wrongs.” Navajo I, 46 Fed. Cl.

at 227, 236. Specifically, according to the Court of Fed-

eral Claims, neither the IMLA of 1938 nor its imple-

menting regulations, 25 C.F.R. Part 211 (1985), imposed

“specific duties regarding the Secretary’s adjustment of

royalty rates for coal.” /d. at 234. Similarly, 25 C.F.R.

Parts 169 (1985) (rights-of-way over Indian lands), 200

(1993) (terms and conditions of coal leases), and 216

(1985) (surface exploration, mining, and reclamation of

lands) failed to provide a money mandating cause of ac-

tion because they merely “touch|ed| summarily on the

topic of royalties.” See id. at 232. The Court of Federal

Claims granted summary judgment in favor of the gov-

ernment.

On appeal, this court reversed and remanded. Na-

vajo I], 263 F.3d at 1333. Specifically, this court held

that the IMLA of 1938, its implementing regulations,

and the Act of Jun. 30, 1919 (“Act of 1919”), ch. 4, § 26,

41 Stat. 31, 25 U.S.C. § 399, provided the authority for

a claim for damages within the jurisdiction of the Court

of Federal Claims. Navajo I/, 263 F.3d at 1328-33.

The Supreme Court granted certiorari, reversed, and

remanded. Navajo 11], 537 U.S. at 514, 123 S. Ct. 1079.

The Court held that “the IMLA [of 1938] and its regula-

tions do not assign to the Secretary managerial control

over coal leasing. Nor do they even establish the ‘lim-

ited trust relationship’” of United States v. Mitchell

(“Mitchell I”), 445 U.S. 535, 542, 100 S. Ct. 1349, 63 L.

Ed. 2d 607 (1980). Navajo III, 537 U.S. at 506-08,

512-13, 123 8. Ct. 1079. The Court also stated that reli-

ance on 25 U.S.C. § 399 was misplaced and that the Na-

tion’s lease fell outside the domain of the Act of Dec. 22,

1982 (“Indian Mineral Development Act of 1982” or

“IMDA of 1982”), Pub. L. No. 97-382, 96 Stat. 1938, 25

U.S.C. §§ 2101-08. Navajo IIT, 537 U.S. at 509, 123 S.

Ct. 1079.

We subsequently remanded to the Court of F sderal

Claims with instructions. Navajo lV, 347 F.3d at 1332.

Finding the Supreme Court’s Navajo /// decision lim-

ited to the IMLA of 1938, 25 U.S.C. § 399, and the IMDA

of 1982, this court directed the Court of Federal Claims

(1) to “determine whether, as the government asserts,

the Tribe waived a claim with respect to ‘a network of

other statutes and regulations,’” and if not, (2) to “de-

cide, whether, apart from IMLA [of 1938], section 399,

and IMDA [of 1982], a ‘network of other statutes and

regulations’ imposes ‘judicially enforceable fiduciary

duties upon the United States.’” Navajo IV, 347 F.3d at

1333.

On remand, the Court of Federal Claims found no

waiver because the Nation’s “advocacy on behalf of ju-

risdiction always included the network argument.” Na-

vajo V, 68 Fed. Cl. at 810. The Court of Federal Claims

concluded, however, that the network of other statutes

and regulations “does not suffice to establish a money-

mandating trust in the area of royalty rates.” /d. at 815.

The Nation appealed to this court.

This court has jurisdiction of the appeal pursuant to

28 U.S.C. § 1295(a)(3).

Il.

A. Standard of Review

The threshold issue in this appeal, as with the five

previous Navajo decisions, is whether the Nation has

stated a claim cognizable under 28 U.S.C. § 1505, known

as the Indian Tucker Act. This is an issue of law that

this court reviews without deference. Fisher v. United

States, 402 F.3d 1167, 1173 (Fed. Cir. 2005) (en banc in

pertinent part) (“The trial court’s determination regard-

ing the money-mandating character of the statute at

issue is of course subject to appellate review as a ques-

tion of law.”).

The Court of Federal Claims applies the same sum-

mary judgment standard as that of federal! district

courts: summary judgment is proper if the evidence

demonstrates that “there is no genuine issue as to any

10a

material fact and that the moving party is entitled to a

judgment as a matter of law.” See Ct. Fed. Cl. R. 56(c);

Fed. R: Civ. P. 56(c); see also Celotex Corp. v. Catrett,

477 U.S. 317, 322-23, 106 S. Ct. 2548, 91 L. Ed. 2d 265

(1986); SmithKline Beecham Corp. v. Apotex Corp., 403

F.3d 1331, 1337 (Fed. Cir. 2005). Therefore, if the Na-

tion has stated a claim cognizable under the Indian

Tucker Act, we review without deference whether the

United States breached its trust duties. SmithKline,

403 F.3d at 1337.

B. Legal Standard

The Supreme Court’s decisions in Mitchell I, 445

U.S. 535, 100 S. Ct. 13849, United States v. Mitchell

(“Mitchell IT”), 463 U.S. 206, 103 S. Ct. 2961, 77 L. Ed.

2d 580 (1983), Apache, 537 U.S. 465, 123 S. Ct. 1126, 155

L. Ed. 2d 40, and Navajo III, 537 U.S. 488, 123 S. Ct.

1079, 155 L. Ed. 2d 60, control this case. As explained in

Apache:

Jurisdiction over any suit against the Government

requires a clear statement from the United States

waiving sovereign immunity, together with a claim

falling within the terms of the waiver. The terms of

consent to be sued may not be inferred, but must be

“unequivocally expressed” in order to “define [a]

court’s jurisdiction.” The Tucker Act contains such

a waiver, giving the Court of Federal Claims juris-

diction to award damages upon proof of “any claim

against the United States founded either upon the

Constitution, or any Act of Congress,” and its com-

panion statute, the Indian Tucker Act, confers a like

waiver for Indian tribal claims that “otherwise would

lla

be cognizable in the Court of Federal Claims if the

claimant were not an Indian tribe.”

Neither Act, however, creates a substantive right

enforceable against the Government by a claim for

money damages. As we said in Mitchell I], a statute

creates a right capable of grounding a claim within

the waiver of sovereign immunity if, but only if, it

“can fairly be interpreted as mandating compensa-

tion by the Federal Government for the damage sus-

tained.”

This “fair interpretation” rule demands a show-

ing demonstrably lower than the standard for the

initial waiver of sovereign immunity. “Because the

Tucker Act supplies a waiver of immunity for claims

of this nature, the separate statutes and regulations

need not provide a second waiver of sovereign immu-

nity, nor need they be construed in the manner ap-

propriate to waivers of sovereign immunity.” It is

enough, then, that a statute creating a Tucker Act

right be reasonably amenable to the reading that it

mandates a right of recovery in damages. While the

premise to a Tucker Act claim will not be “lightly in-

ferred,” a fair inference will do.

537 U.S. at 472-73, 123 S. Ct. 1126 (modification in origi-

nal, citations omitted, emphasis added); see also Navajo

111, 5387 U.S. at 506, 123 S. Ct. 1079 (stating that courts —

must “determine whether the relevant source of sub-

stantive law can fairly be interpreted as mandating com-

pensation for damages sustained as a result of a breach

of the duties [the governing law] impose[s]” (modifica-

tions in original, citation and quotation marks omitted)).

12a

The Supreme Court’s pathmarking precedents guide

courts in determining “when it is fair to infer a fiduciary

duty qualifying under the Indian Tucker Act and when

it is not.” Apache, 537 U.S. at 473, 123 S. Ct. 1126; see

also Gregory C. Sisk, Yesterday and Today: Of Indians,

Breach of Trust, Money, and Sovereign Immunity, 39

Tulsa L. Rev. 313 (2003).

In Mitchell J,

1,465 individual allottees of land contained in the

Quinault Reservation, the Quinault Tribe, which now

holds some allotments, and the Quinault Allottees

Association, an unincorporated association formed to

promote the interests of the allottees of the Quinault

Reservation . . . . sought to recover damages from

the Government for alleged mismanagement of tim-

ber resources found on the Reservation.

445 US. at 537, 100 S. Ct. 1349. Acknowledging that the

Act provided that the United States held “ ‘the land thus

allotted . . . in trust for the sole use and benefit of the

Indian to whom such allotment shal! have been made,’”

the Court held that “the General Allotment Act[, ch. 119,

24 Stat. 388 (codified as amended in scattered sections

of 25 U.S.C.) ] . . . cannot be read as establishing that

the United States has a fiduciary responsibility for man-

agement of allotted forest lands.” Mitchell J, 445 U.S.

at 540-41, 100 S. Ct. 1349 (quoting 25 U.S.C. § 348), 546.

In so holding, the Court found it relevant that “Congress

subsequently enacted other legislation directing the Sec-

retary on how to manage Indian timber resources.”

Mitchell 1,445 U.S. at 544-46, 100 S. Ct. 1349.

Three years later, this “other legislation” noted in

Mitchell | succeeded where the Genera! Allotment Act

13a

failed. Specifically, in Mitchell 1/7, the Court held that

the asserted network of statutes and regulations could

“fairly be interpreted as mandating compensation by the

Federal Government for violations of its fiduciary re-

sponsibilities in the management of Indian property,”

including the alleged mismanagement of timber re-

sources. 463 U.S. at 228, 103 S. Ct. 2961. The Court

reasoned that the statute and regulations (i) establish

“comprehensive’ responsibilities of the Federal Govern-

ment in managing the harvesting of Indian timber” (ii)

for the benefit of the Indian owner and his heirs. See 7d.

at 222-24, 103 S. Ct. 2961; see also Navajo [11,537 U.S.

at 504-06, 123 S. Ct. 1079 (discussing Mitchell 11);

Apache, 587 U.S. at 473-74, 123 S. Ct. 1126 (same).

Similarly, in Apache, the Court held that the White

Mountain Apache Tribe had a cognizable claim “against

the United States for breach of fiduciary duty to manage

land and improvements held in trust for the Tribe but

occupied by the Government.” 537 U.S. at 468, 123 S.

Ct. 1126. The Court found it fair to infer a fiduciary

duty because: (i) the statute provides that “the former

Fort Apache Military Reservation” is “held by the

United States in trust for the White Mountain Apache

Tribe”; (ii) the statute subjects the trust property “to

the right of the Secretary of the Interior to use any part

of the land and improvements for administrative or

school purposes for as long as they are needed for that

purpose”; (iii) the government availed itself of that op-

tion by occupying the trust corpus; and (iv) “elemen-

tary” and “fundamental common-law” trust law imposes

a duty on a trustee to preserve and maintain trust as-

sets. /d. at 469, 475, 123 S. Ct. 1126.

14a

In Navajo II], argued and decided on the same days

as Apache, the Court reached a different result. The

Court held that the Indian Mineral Leasing Act of 1938

and its implementing regulations could not “fairly be

interpreted as mandating compensation for the Govern-

ment’s alleged breach of trust” in approving amend-

ments to a coal lease even though Peabody exerted ex

parte influence on the Secretary of the Interior. Navajo

III, 5387 U.S. at 506, 123 S. Ct. 1079. The Court rea-

soned that the IMLA of 1938 and its implementing regu-

lations: (i) did not, at the relevant time, “contain any

trust language with respect to coal leasing”; (ii) “aim[ed]

to enhance tribal self-determination by giving Tribes,

not the Government, the lead role in negotiating mining

leases with third parties”; (iii) failed to assign the gov-

ernment a “comprehensive managerial role” rising to

the level of Mitchell 11; and (iv) provided “no guides or

standards circumscribing the Secretary’s affirmation of

coal mining leases negotiated between a Tribe and a

private lessee” that were allegedly violated. Navajo //1],

537 U.S. at 507-11, 123 S. Ct. 1079. In discussing Mitch-

ell IJ, however, the Court continued to state that a net-

work of statutes and regulations could “impose judicially

enforceable fiduciary duties upon the United States.”

Navajo III, 537 U.S. at 504-05, 123 S. Ct. 1079. The

Court “remanded for further proceedings consistent

with [the Navajo T77] opinion.” Jd. at 514, 123 S. Ct.

1079.

Against this backdrop, we must now consider

whether the statutes and regulations at issue in this ap-

peal are reasonably amenable to the reading that they

mandate a right of recovery in damages against the gov-

15a

ernment under the Indian Tucker Act. While the Su-

preme Court held in Mitchell I that the General Allot-

ment Act alone is insufficient, the Court held in Mitchell

IT that the network of statutes and regulations asserted

by the allottees of land is reasonably amenable to man-

dating compensation by the federal government for vio-

lations of its fiduciary responsibilities, including the al-

leged mismanagement of timber resources. Similarly, in

this case, while the Court held in Navajo IJ] that the

IMLA of 1938, 25 U.S.C. § 399, and the IMDA of 1982

are insufficient, our task is to determine whether the

network of other statutes and regulations asserted by

the Nation in this appeal is reasonably amenable to a

reading that they mandate compensation by the federal

government for violating its common law fiduciary trust

duties and the duties imposed by the network. Only if

the network is so reasonably amenable, may we evaluate

whether the United States government breached its du-

ties based on the parties’ cross-motions for summary

judgment.

We note at the outset that this is not a case where

the government had the discretion to exercise control

and did not do so. Rather, in this case, the government

exerted actual and significant control over the determi-

nation of the increased royalty rate in the lease amend-

ments because its approval was required by law. In.

March 1984, the Nation requested that the Secretary of

the Interior, who was then William Clark, make a rea-

sonable adjustment of the royalty rate as provided by

the coal lease. In July 1985, the Secretary, who was now

Donald Hodel, effectively refused to make any perma-

nent adjustments after meeting with Peabody’s repre-

sentative, whom the government conceded was “a for-

mer aide and friend of Secretary Hodel.” The Nation

16a

sought Secretarial approval precisely because the gov-

ernment exercised control over the leasing of coal re-

sources. This active and effective assumption of control

resulted in, as the Court of Federal Claims found, “Na-

vajo enter[ing] the process unarmed with critical knowl-

edge” and unaware “that it no longer had [a] competitive

edge in its bargaining while the companies were well

aware of the fact.” Navajo I, 46 Fed. Cl. at 227. “Then

after very briefly reviewing the merits of the pruposals,

the Secretary approved lease amendments with royalty

rates well below the rate that had previously been deter-

mined appropriate by those agencies responsible for

monitoring the federal government’s relations with Na-

tive Americans.” /d. at 226-27. Faced with a claim for

damages for this exercise of control, the government

now takes the opposite stance, asserting that it had no

contro]—statutory, regulatory, or otherwise—regarding

the determination of the royalty rate in lease amend-

ments. The law does not allow the government to have

it both ways. That is, the government. cannot assume

comprehensive control of the Nation’s coal, as it did

here, and disclaim liability for exercising such control.

A. Network Asserted by the Nation

The Nation presents an array of authorities that, it

asserts, cumulatively establish a money-mandating

source for its claim. The Nation’s asserted network in-

cludes: (i) the Treaty with the Navajo (“Treaty of

1849”), Sept. 9, 1849, 9 Stat. 974; (ii) the Treaty Between

the United States of America and the Navajo Tribe of

[Indians (“Treaty of 1868”), Aug. 12, 1868, 15 Stat. 667;

(iii) Exee. Order of May 17, 1884 (“Executive Order of

1884”); (iv) the Act of June 14, 1934 (“Act of 1934”), ch.

521, 48 Stat. 960; (v) the Act of April 17, 1950 (“Na-

17a

vajo-Hopi Rehabilitation Act of 1950”), ch. 92, 64 Stat.

44, 25 U.S.C. §§ 631-40; (vi) the Indian lands section, 30

U.S.C. § 1300, of the Act of August 3, 1977 (“Surface

Mining Control and Reclamation Act of 1977”), Pub. L.

No. 95-87, 91 Stat. 445 (codified as amended in scattered

sections of 30 U.S.C.); (vii) the regulations, 25 C.F.R.

Part 216 Subpart B (1987) and 30 C.F.R. Part 750

(1987), promulgated pursuant to the Surface Mining

Control and Reclamation Act of 1977; * and (viii) the Act

of January 12, 1983 (“Federal Oil and Gas Royalty Man-

agement Act of 1983”), 30 U.S.C. §§ 1701-57, and its im-

plementing regulations, 30 C.F.R. Parts 212, 216, and

218 (1987), and 30 C.F.R. Part 206 Subpart F (1989).

The Nation also asserts that the following may con-

tribute to its asserted network: (ix) the policies of the

Department of the Interior; (x) the provisions of Lease

8580; (xi) the Act of February 5, 1948 (“Indian Lands

Rights-of-Way Act of 1948”), 25 U.S.C. §§ 323-28, and its

implementing regulations, 25 C.F.R. Part 169 (1987);

and (xii) the IMLA of 1938 and its implementing regula-

tions.

B. Relevance and Preservation of Network Ele-

ments Other Than IMLA of 1938

At the threshold, the government asserts that the

statutes and regulations asserted by the Nation are ir-

relevant because “Lease 8580 is an IMLA lease, and the

Secretary's approval occurred pursuant to IMLA, not

any of the provisions upon which the Tribe now relies for

its ‘network.’” U.S. Br. 34. Nothing within the IMLA of

* In Navajo V, the Court of Federal Claims noted that the Nation's

asserted network also included 30 C.F.R. Part 955. 68 Fed. Cl. at 808.

Because the Nation has not cited this regulation anywhere in its briefs

in this appeal, we do not consider those regulations here.

18a

1938 suggests, however, that it governs particular leases

to the exclusion of all other statutes and regulations.

The repeal provision of the IMLA of 1938, § 7, applies

only to acts or parts of acts existing prior to and incon-

sistent with the IMLA. Moreover, the Act expressly

contemplates that its provisions interact with those of

other laws. See IMLA of 1938, § 7, 25 U.S.C. § 396d

(“All operations under any oil, gas, or other mineral

lease issued pursuant to the terms of sections 396a to

396g of this title or any other Act affecting restricted

Indian lands shall be subject to the rules and regulations

promulgated by the Secretary of the Interior.”). There-

fore, the court rejects the government’s argument that

the IMLA of 1938 is the only possible substantive source

of law in this case.

As an alternative ground for affirmance, the govern-

ment asserts that the Nation waived its breach of trust

claim based on a network of statutes and regulations.

The government’s waiver argument fails for several rea-

sons.

First, after reviewing the complaint, summary judg-

ment briefs, motion for reconsideration briefs, briefs to

this court in its first appeal, and briefs to the Supreme

Court, the Court of Federal Claims concluded that the

Nation’s “advocacy on behalf of jurisdiction always in-

cluded the network argument, albeit in a secondary

role.” Navajo V, 68 Fed. Cl. at 810. The government

does not dispute this conclusion, and that alone should

defeat its waiver argument. Similarly, we can find no

error and thus affirm the Court of Federal Claims on

this issue.

Second, “[i]t is indeed the general rule that issues

must be raised in lower courts in order to be preserved

19a

as potential grounds of decision in higher courts. But

this principle does not demand the incantation of partic-

ular words; rather, it requires that the lower court be

fairly put on notice as to the substance of the issue.”

Nelson v. Adams USA, Inc., 529 U.S. 460, 469, 120 S. Ct.

1579, 146 L. Ed. 2d 530 (2000); see also Caterpillar Inc.

v. Sturman Indus., inc., 387 F.3d 1358, 1371 (Fed. Cir.

2004) (noting that rationales of waiver doctrine are to

encourage parties to develop a full record of the case

and to inform “the court about potential errors so as to

put the court on notice of mistakes that, if left uncor-

rected, may result in reversal on appeal”). By asserting

a breach of trust claim based on a network of statutes

and regulations including the IMLA of 1938, the Nation

preserved a breach of trust claim based on a network of

statutes and regulations regardless of whether the

IMLA of 1938 is included. The waiver doctrine does not

require, as the government asserts, that the Nation pre-

serve each particular network permutation.

Third, the “matter of what questions may be taken

up and resolved for the first time on appeal is one left

primarily to the discretion of the courts of appeals, to be

exercised on the facts of individual cases.” Singleton v.

Wulff, 428 U.S. 106, 121, 96 S. Ct. 2868, 49 L. Ed. 2d 826

(1976); see also Harris Corp. v. Ericsson Inc., 417 F.3d

1241, 1251 (Fed. Cir. 2005) (“An appellate court retains

case-by-case discretion over whether to apply waiver.”

(citations omitted)). For example, “[wjhen an issue or

claim is properly before the court, the court is not lim-

ited to the particular legal theories advanced by the par-

ties, but rather retains the independent power to iden-

tify and apply the proper construction of governing law.”

Kamen v. Kemper Fin. Servs., Inc., 500 U.S. 90, 99, 111

S. Ct. 1711, 114 L. Ed. 2d 152 (1991).

20a

We conclude that there was no applicable waiver, and

we proceed to evaluate the network of statutes and reg-

ulations asserted by the Nation in this case.

C. Non-Money-Mandating Elements of the Nation’s

Asserted Network

For completeness, we briefly address the Nation’s

assertion of elements (ix) through (xii), none of which we

find contribute to a money-mandatirg network.

The departmental policies cannot provide the sub-

stantive source of law that mandates compensation for

the government’s alleged breach of trust. As the Su-

preme Court has noted, “[jJurisdiction over any suit

against the Government requires a clear statement from

the United States waiving sovereign immunity, together

with a claim falling within the terms of the waiver.”

Apache, 537 U.S. at 472, 123 S. Ct. 1126. The Indian

Tucker Act, 28 U.S.C. § 1505, provides the waiver of

sovereign immunity in this case and states that the claim

must be “one arising under the Constitution, laws or

treaties of the United States, or Executive orders of the

President, or is one which otherwise would be cognizable

in the Court of Federal Claims.” The Tucker Act, 28

U.S.C. § 1491(a), defines claims cognizable in the Court

of Federal Claims as “any claim against the United

States founded either upon the Constitution, or any Act

of Congress or any regulation of an executive depart-

ment, or upon any express or implied contract with the

United States.” Neither the Indian Tucker Act nor the

Tucker Act provides for claims based on departmental

policies, which are not regulations that have the force of

law. Cf Schweiker v. Hansen, 450 U.S. 785, 789-90, 101

S. Ct. 1468, 67 L. Ed. 2d 685 (1981) (stating that Claims

Manual of Social Security Administration is not regula-

2la

tion, has no legal force, and does not bind Administra-

tion); Morton v. Ruiz, 415 U.S. 199, 234-36, 94 S. Ct.

1055, 39 L. Ed. 2d 270 (1974) (stating that Bureau of

Indian Affairs Manual has no force of law, but holding

nonetheless, that Manual must be followed under Ad-

ministrative Procedure Act); Hamlet v. United States,

63 F.3d 1097, 1105-06 (Fed. Cir. 1995) (stating that in-

ternal personnel manual may, if three other require-

ments are met, have the force and effect of law because

matters relating to agency personnel are “exempt from

the strict procedura! requirements found in the [Admin-

istrative Procedure Act]”). Therefore, any claims based

on departmental policies would not fall within the scope

of the asserted waiver of sovereign immunity.

For similar reasons, Lease 8580 does not constitute

a substantive source of law for the Nation’s breach of

trust claim. The Nation asserts that a mineral lease is

a “fundamental document,” which may form part of the

network establishing government trust liability. It is

true that the Supreme Court suggested that a breach of

trust claim under the Indian Tucker Act may arise from

a “statute (or other fundamental document).” See

Mitchell II, 463 U.S. at 225, 103 S. Ct. 2961 (quoting

Navajo Tribe of Indians v. United States, 224 Ct. Cl.

171, 624 F.2d 981, 987 (1980)) (emphasis added). It is

also true that claims founded “upon any express or im-

plied contract with the United States” are cognizable

under the Tucker Act, 28 U.S.C. § 1491(a). The Su-

preme Court, however, rejected this exact argument in

Navajo IT.

|T}he Court of Federal Claims determined, and the

Tribe does not here dispute. that the Secretary is not

a signatory to the Lease and that the Lease is not

224

contractually binding on him. We thus perceive no

basis for infusing the Secretary’s approval function

under § 396a with substantive standards that might

be derived from his adjustment authority under the

Lease, and certainly no basis for concluding that an

alleged “breach” of those standards is cognizable in

an action for money damages under the Indian

Tucker Act.

537 U.S. at 510 n.13, 123 S. Ct. 1079. This court per-

ceives no basis or authority for concluding otherwise.

Next, the Indian Lands Rights-of-Way Act of 1948

and its implementing regulations do not provide a rele-

vant substantive source of law. The Act empowers the

Secretary of the Interior “to grant rights-of-way for all

purposes, subject to such conditions as he may pre-

scribe” and to “the consent of the proper tribal officials.”

25 U.S.C. §§ 323-24. Seizing on the Supreme Court’s

discussion of these statutes in Mitchell I], 463 U.S. at

223, 103 S. Ct. 2961, the Nation in this case asserts that

the government’s “comprehensive control over Indian

rights-of-way augments its control over Navajo coal de-

velopment even more than it did over timber production

in Mitchell I1.” Nation Br. 36. The rights-of-way stat-

utes, however, did net augment the government’s con-

trol over timber production; rather, the Court cited the

statutes as a point of comparison. See Mitchell 11, 463

U.S. at 223, 103 S. Ct. 2961 (concluding that timber man-

agement statutes and regulations establish comprehen-

sive government control and then, statimg that “Depart-

ment exercises comparable control over grants of

rights-of-way on Indian lands held in trust”). Similarly,

in this case, while other regulations that are properly

part of the Nation’s asserted network may require per-

23a

mits for surface coal mining operations activities for

“lands affected by the construction of new roads or the

improvement or use of existing roads to gain access,” see

infra Part III.D.3 (30 C.F.R. § 750.11(a) (1987)), the

Indian Lands Rights-of-Way Act of 1948 and its imple-

menting regulations do not augment the government’s

control of the Nation’s coal and thus are not part of the

relevant network.

Lastly, the Nation asserts the IMLA of 1938 and its

regulations, 25 C.F.R. Part 211 (1987) and Part 216

Subpart A (1987). This court’s consideration of the

IMLA of 1938 and its regulations, however, is foreclosed

by Navajo IV, 347 F.3d at 1332 (directing Court of Fed-

eral Claims to consider whether network of other stat-

utes and regulations apart from IMLA of 1938 estab-

lishes cognizable breach of trust claim). While there is

persuasive force in Judge Newman’s dissent stating

“{tJhat the Indian Mineral Leasing Act is insufficient

standing alone does not bar adding its weight to the to-

tality of statutes, treaties, and regulations governing

mineral leasing,” id. at 1333 (Newman, J., dissenting),

the previous decision is law of the case.

Accordingly, we find that the departmental policies,

the provisions of Lease 8580, the Indian Lands

Rights-of-Way Act of 1948 and its implementing regula-

tions, and the IMLA of 1938 and its implementing regu-

lations cannot be substantive sources of law on which the

Nation may base its breach of trust claim.

24a

D. Money-Mandating Elements of the Nation’s As-

serted Network

1. Existence of Trust Relationship and

Trust Language

There is no question the Treaty of 1849 establishes

a general trust relationship. Specifically, the treaty

states that the Navajo “tribe was lawfully placed under

the exclusive jurisdiction and protection of the Govern-

ment of the said United States, and that they are now,

and will forever remain, under the aforesaid jurisdiction

and protection” and “that the Government of the United

States shall so legislate and act as to secure the perma-

nent prosperity and happiness of said Indians.” Art. I,

X1. While this general! trust relationship is potentially

reinforcing of “the conclusion that the relevant statute

or regulation imposes fiduciary duties, that relationship

alone is insufficient to support jurisdiction under the

Indian Tucker Act.” Navajo [1], 537 U.S. at 506, 123 S.

Ct. 1079 (citation omitted).

There must be “specific rights-creating or duty- im-

posing statutory or regulatory prescriptions. Those pre-

scriptions need not, however, expressly provide for

money damages; the availability of such damages may

be inferred.” /d. In Apache, the Court found it signifi-

cant that a statute provided that the Fort Apache Mili-

tary Reservation would be “held by the United States in

trust for the White Mountain Apache Tribe.” See 537

U.S. at 468-69, 474-75, 123 S. Ct. 1079 (quoting the Act

of Jan. 24, 1923, ch. 42, 42 Stat. 1187). In Mitchell 11,

the statutes and regulations gave the government “full

responsibility to manage Indian resources and land for

the benefit of the Indians.” 463 U.S. at 224, 1083S. Ct.

2961; see also Navajo III, 587 U.S. at 504-05, 123 S. Ct.

25a

1079 (discussing Mitchell 11); Apache, 537 U.S. at 474,

123 S. Ct. 1126 (same). Even the statute at issue in

Mitchell 1 went beyond the general trust relationship

and established a “limited” trust relationship by stating

that “the United States does and will hold the land thus

allotted . . . in trust for the sole use and benefit of the

Indian to whom such allotment shall have been made.”

445 U.S. at 540-42, 100 S. Ct. 1849 (quoting General Al-

lotment Act); see Mitchell I], 463 U.S. at 224-25, 103 S.

Ct. 2961 (discussing Mitchell J limited trust relation-

ship and general trust relationship); see also Navajo I11,

537 U.S. at 504, 123 S. Ct. 1079 (discussing Mitchell J);

Apache, 537 U.S. at 473, 123 S. Ct. 1126 (same).

In contrast, the Court found that the IMLA of 1938

and its regulations did not satisfy this statutory and reg-

ulatory language threshold in Navajo IJ]: “Nor do they

even establish the ‘limited trust relationship’ existing

under the [General Allotment Act]; no provision of the

IMLA [of 1938] or its regulations contains any trust lan-

guage.” 537 U.S. at 508, 123 S. Ct. 1079. Justice Gins-

burg emphasized that this lack of trust language set

Navajo III apart from Apache. Apache, 537 U.S. at

479-81, 123 S. Ct. 1126 (Ginsburg, J., concurring) (com-

paring existence of trust language in Apache statute

with absence of such in Navajo ///] statute and regula-

tions).

Where the IMLA of 1938 and its regulations failed,

however, the network of other statutes and regulations

asserted by the Nation succeeds. The coal that is the

subject of Lease 8580 and its amendments sits on the

Nation’s “reservation lands, which are held for it in trust

by the United States.” Navajo 111,537 U.S. at 495, 123

S. Ct. 1079. The Treaty of 1868 established the Navajo

26a

reservation, setting a territory “apart for the use and

occupation of the Navajo tribe of Indians.” 15 Stat. 667

at art. II, XIII. The Executive Order of 1884 added

lands from Arizona and Utah to the Navajo “reservation

for Indian purposes.” The Act of 1934 confirmed the

“exterior boundaries of the Navajo Indian Reservation,

in Arizona,” stating that the lands were to be “perma-

nently withdrawn from all forms of entry or disposal for

the benefit of the Navajo.” 48 Stat. 960 § 1. The Act of

1934 also authorized the Secretary of the Interior “to

accept relinquishments and reconveyance to the United

States of such privately owned lands,” which would “be

held in trust for the Navajo Tribe of Indians.” /d. § 2.

The Act of December 22, 1974 (“Act of 1974”), 88 Stat.

1712, 25 U.S.C. §§ 640d to 640d-31, confirmed that the

lands described in the Act of 1934 “shall be held in trust

by the United States exclusively for the Navajo Tribe

and as a part of the Navajo Reservation.” 25 U.S.C.

§ 640d-9. Because “[mJinerals and standing timber are

constituent elements of the land itself,” United States v.

Shoshone Tribe of Indians of Wind Rive~ Reservation,

304 U.S. 111, 116, 58 S. Ct. 794, 82 L. Ed. 1213 (1938),

and because there is no language severing coal from the

land held in trust, the language stating that the govern-

ment holds lands in trust for the Nation applies equally

to the Nation’s coal located on that land.

Therefore, the substantive sources of law cited by the

Nation contain explicit trust language. Because such

language is necessary but not sufficient for an Indian

Tucker Act breach of trust claim, we proceed to evaluate

whether the network of statutes and regulations as-

serted by the Nation establishes specific fiduciary or

other duties that can fairly be interpreted as mandating

27a

compensation for damages sustained. Navajo III, 537

U.S. at 506, 123 S. Ct. 1079.

2. Control of Coal Resource Planning

The government assumed coal resource planning

responsibilities in the Navajo-Hopi Rehabilitation Act of

1950.° Specifically, the Act authorized and directed the

government to embark on “a program of basic improve-

ments for the conservation and development of the re-

sources of the Navajo and Hopi Indians, . . . and the

supplying of means to be used in their rehabilitation.”

25 U.S.C. § 631. The Act thus appropriated $500,000

and “funds from time to time appropriated pursuant to

this subchapter” for “[sJurveys and studies of timber,

coal, mineral, and other physical and human resources”

and mandated that the Nation “be kept informed and

afforded opportunity to consider from their inception

plans pertaining to the program authorized.” Jd. §§ 631,

638 (emphasis added). In the context of the Act, it is

clear that the government conducted such surveys and

studies of the Nation’s coal resources for the purpose of

developing the coal economically.

3. Control of Coal Mining Operations

The regulations promulgated pursuant to the Surface

Mining Control and Reclamation Act of 1977 also estab-

lish that the government assumed comprehensive con-

trol of coal mining operations. In 1977, the Department

* As the government asserts, it is true that the regulations promul-

gated in 2001 pursuant to the Navajo-Hopi Rehabilitation Act do not

apply to mineral leases. 25 C.F.R. § 162.103 (2006) (“These regulations

do not apply to . . . mineral leases.”). This limit speaks, however, only

to the scope of the regulations, not the Act. Therefore, the Act may

contribute to the Nation’s asserted network.

28a

of the Interior promulgated what would become 25

C.F.R. Part 216 Subpart B (1987).* These regulations

established detailed “performance standards .. . to

each coal mining operation on Indian lands on or after

December 16, 1977,” including specifying requirements

for signs and markers, postmining use of land, backfill-

ing and grading, waste disposal, topsoil handling, pro-

tection of hydrologic systems, revegetation, and steep-

slope mining. /d. §§ 216.103 to 216.111.

Similarly in 1984, the Department of the Interior

promulgated what would become 30 C.F.R. Part 750

(1987). These regulations established numerous surface

coal mining operations responsibilities for the Office of

Surface Mining, the Bureau of Land Management, the

Minerals Management Service, and the Bureau of In-

dian Affairs. The responsibilities included approving

and disapproving permits, inspection and enforcement,

protecting non-coal resources, approving and disapprov-

ing coal exploration and mining plans, administering

mining leases, collecting »~d accounting for royalties,

and furnishing copies of nuiices and orders to mineral

owners. 30 C.F.R. §§ 75% *, 750.18 (1987). In addition,

the regulations specifica.., make the Bureau of Indian

Affairs responsible for “providing representation for

Indian mineral owners and other Indian land owners in

* As discussed in supra Part III.C, Navajo IV forecloses this panel

from considering Subpart A of 25 C.F.R. Part 216 as part of the Tribe’s

network. Subpart B, however, was promulgated pursuant to the Sur-

face Mining Control and Reclamation Act of 1977, not the IMLA of

1938. Compare 34 Fed. Reg. 813 ( Jan. 18, 1969) (codified as amended

at 25 C.F.R. Part 216 Subpart A) with 42 Fed. Reg. 63,395 (Dec. 16,

1977) (codified as amended at 25 C.F.R. Part 216 Subpart B). There-

fore, this court considers the regulations of Subpart B as properly

asserted by the Nation.

29a

matters relating to surface coal mining and reclamation

operations on Indian lands.” Jd. § 750.6(d).

4. Control of the Management and Collection of

Coal Mining Royalties

In addition, the government assumed comprehensive

control of the management and collection of royalties

from coal mining. Section 303 of the Federal Oil and

Gas Royalty Management Act of 1983 directed the Sec-

retary of the Interior to

study the question of the adequacy of royalty man-

agement for coal, uranium and other energy and

nonenergy minerals on Federal and Indian lands.

The study shall include proposed legislation if the

Secretary determines that such legislation is neces-

sary to ensure prompt and proper collection of reve-

nues owed to the United States, the States and In-

dian tribes or Indian allottees from the sale, lease or

other disposal of such minerals.

Concluding that the existing auditing systems “should

be extended to cover solid minerals royalty management

in addition to oi] and gas” and that new legislation was

not required to do so, 51 Fed. Reg. 15,764 (Apr. 28,

1986), the Department of the Interior promulgated reg-

ulations for solid minerals such as coal, requiring the

maintenance and access to records, the accounting and

auditing of royalties, and the collection of royalties. See

30 C.F.R. Parts 212, 216, 218 (1987).

Also pursuant to the Federal Oil and Gas Royalty

Management Act of 1983, the Department of the Inte-

rior promulgated 30 C.F.R. Part 206 Subpart F (1989),

which “prescribes the procedures to establish the value,

for royalty purposes, of all coal from Federal and Indian

30a

Tribal and allotted leases.” 30 C.F.R. § 206.250(a)

(1989). “These rules largely continue past practice for

coal valuation,” 54 Fed. Reg. 1492 (Jan. 13, 1989) (stat-

ing purpose and background in final rule); adopt “valua-

tion methods [that] would yield a reasonable and

long-term maximum rate of return for both Federal and

Indian leases,” 52 Fed. Reg. 1840 (Jan. 15, 1987) (stat-

ing purpose and background of proposed rulemaking

notice); and “are intended to ensure that the trust re-

sponsibilities of the United States with respect to the

administration of Indian coal leases are discharged in

accordance with the requirements of the governing min-

eral leasing laws, treaties, and lease terms,” 30 C.F.R.

§ 206.250(d).

Citing Navajo [1], 537 U.S. at 508 n.12, 123 S. Ct.

1079, the government emphasizes that 30 C.F.R. Part

206 Subpart F “was not promulgated until 1989, after

the events at issue in this case,” and as such, “until 1989

the regulation was just that— a practice—and therefore

irrelevant to Tucker Act jurisdiction.” U.S. Br. 42-43.

While it is true that the regulation was adopted “after

the events at issue,” Navajo /1/, 537 U.S. at 508 n.12,

123 S. Ct. 1079, the government does not dispute that

the asserted sections of 30 C.F.R. Part 206 Subpart F

deseribe actual practices that existed at the time of the

lease amendments and that such practices are within the

Department of the Interior’s authority. Where the gov-

ernment exercises actual control within its authority,

neither Congress nor the agency needs to codify such

actual control for a fiduciary trust relationship that is

enforceable by money damages to arise. See Apache,

537 U.S. at 475, 123 S. Ct. 1126 (finding “a fair inference

that an obligation to preserve the property improve-

ments was incumbent on the United States as trustee”

3la

where government exercised its discretionary authority

to supervise and occupy property); see also Mitchell 11,

463 U.S. at 225, 103 S. Ct. 2961 (“{W]here the Federal

Government takes on or has control or supervision over

tribal monies or properties, the fiduciary relationship

normally exists with respect to such monies or proper-

ties (unless Congress has provided otherwise).”). There-

fore, the practices described by 30 C.F.R. Part 206

Subpart F are relevant and support a finding that the

government had comprehensive control of the manage-

ment and collection of royalties from coal mining.

5. Control of Coal Leasing and Liabilities

Arising Thereunder

We note that specific control of coal leasing is not a

prerequisite for a breach of trust claim in this case. As

discussed in supra, Part III.D.2-4, the language of the

statutes and regulations of the Nation’s asserted net-

work demonstrates that the government exercises com-

prehensive control over coal resource planning, coal

mining operations, and coal royalty management and

collection. As Mitchell I] held regarding the harvesting

and management of timber, 463 U.S. at 222, 103 S. Ct.

2961, virtually every aspect of the coal located on the

Nation’s lands is under the federal government’s con-

trol. It can fairly be interpreted from the government’s

comprehensive control of the Nation’s coal that the Na-

tion’s asserted network establishes a breach of trust

claim under the Indian Tucker Act.

The government nonetheless argues that the as-

serted network must establish contro] or supervision

over coal leasing. It is true that the Supreme Court

stated that “the IMLA [of 1938] and its regulations do

not assign to the Secretary managerial control over coal

32a

leasing.” Navajo I11, 537 U.S. at 508, 123 S. Ct. 1079.

The government, however, cites no authority for the

proposition that control over the greater (e.g., coal re-

sources) does not imply control over the lesser (e.g.,

leasing of such coal) in the Indian Tucker Act context.

Indeed, the Court stated in Mitchell I], 463 U.S. at 225,

103 S. Ct. 2961 (quotation marks and citation omitted),

that where “the Federal Government takes on or has

control or supervision over tribal monies or properties,

the fiduciary relationship normally exists with respect

to such monies or properties (unless Congress has pro-

vided otherwise).” Accord Apache, 537 U.S. at 475, 123

S. Ct. 1126 (finding that control over property implied

“obligation to preserve the property improvements”).

In this case, the government exercised blanket control

over the Nation’s coal resources, which could not be de-

veloped without the clear and positive approval of the

Secretary. The government’s argument that specific

contro! of coal leasing is required for a money-mandat-

ing breach of trust. claim is thus unpersuasive.

Even if it carried weight, that argument is flawed as

applied to this case. The Indian lands section, 30 U.S.C.

§ 1300, of the Surface Mining Control and Reclamation

Act of 1977 controls the content of coal leases. Subsec-

tions (c) and (d) direct the Secretary to incorporate in-

terim and permanent environmental protection stan-

dards for “all existing and new leases issued for coal on

Indian lands.” Subsection (f) also states that “lajny

change required” by these subsections “in the terms and

conditions of any coal lease on Indian lands existing on

August 3, 1977, shall require the approval of the Secre-

ary.” The subsequently promulgated regulation ac-

cordingly amends all leases of coal on Indian lands to

comply with the Surface Mining Control and Reclama-

33a

tion Act of 1977 “and all regulations promulgated there-

under, including those codified at 30 C.F.R. Part 750.”

30 C.F.R. § 750.20(a) (1987). The government thus exer-

cises actual control over the terms and conditions of coal

mining leases, including those already in existence.

Further, the Navajo-Hopi Rehabilitation Act of 1950

contemplates government liability for leases of Indian

lands requiring approval of the Secretary. Section

635(a) of Title 25 states:

Any restricted Indian lands owned by the Navajo

Tribe, members thereof, or associations of such

members, . . . may be leased by the Indian owners,

with the approval of the Secretary of the Interior, for

public, religious, educational, recreational, or busi-

ness purposes, including the development or utiliza-

tion of natural resources in connection with opera-

tions under such leases.

25 U.S.C. § 635(a) (emphasis added). Subsection (a)

makes no mention of government liability. In contrast,

subsection (b) differentiates the respective responsibili-

ties by stating explicitly that “land owned in fee simple

by the Navajo Tribe may be leased, sold, or otherwise

disposed of by the sole authority of the Navajo Tribal

Council, . . . and such disposition shall create no lia-

bility on the part of the United States.” Id. § 635(b)

(emphasis added). Similarly, subsection (c) states:

The Secretary of the Interior is authorized to trans-

fer, upon request of the Navajo Tribal Council,. . .

legal title to or a leasehold interest in any unallotted

lands held for the Navajo Indian Tribe, and thereaf-

ter the United States shall have no responsibility or

liability for, but on request of the tribe shall render

34a

advice and assistance in, the management, use, or

disposition of such lands.

Id. § 635(c) (emphasis added). The Nation thus asserts

that “by expressly exempting the United States from

liability for similar transactions under subsections

635(b) and (c),” it is a “fair inference” that the United

States “intended to shoulder liability and responsibility”

for leases of Indian lands under subsection (a) dealing

with “the development or utilization of natural re-

sources” and requiring approval of the Secretary. Na-

tion Br. 47. The government does not dispute the Na-

tion’s interpretation, and we agree that government lia-

bility from the approval of such leases is a “fair interpre-

tation.”

The Nation’s asserted network thus demonstrates

that the government controls the leasing of the Nation’s

coal resources and that the government is responsible

for the liabilities arising thereunder.

E. Purposes of Asserted Network

Interpreting the asserted network to mandate a

right of recovery in damages against the government in

this case is consistent with the purposes of the statutes

and regulations. First, the government entered into the

Treaty of 1849 “to secure the permanent prosperity and

happiness of said Indians.” 9 Stat. 974 at art. I, XI. Sec-

ond, the Navajo-Hopi Rehabilitation Act of 1950 autho-

rized and directed the Secretary of the Interior to un-

dertake “a program of basic improvements for the con-

servation and development of the resources of the Na-

vajo and Hopi Indians”

to further the purposes of existing treaties with the

Navajo Indians, to provide facilities, employment,

35a

and services essential in combating hunger, disease,

poverty, and demoralization among the members of

the Navajo and Hopi Tribes, to make available the

resources of their reservations for use in promoting

a self-supporting economy and self-reliant communi-

ties, and to lay a stable foundation on which these

Indians can engage in diversified economic activities

and ultimately attain standards of living comparable

with those enjoyed by other citizens.

25 U.S.C. § 631. Third, the regulations promulgated

pursuant to the Federal Oil and Gas Royalty Manage-

ment Act of 1983 recognize that the actual practices of

the Department of Interior, at the time of the lease

amendments in this case, used methods to “yield a rea-

sonable and long-term maximum rate of return for both

Federal and Indian leases” and “intended to ensure that

the trust responsibilities of the United States with re-

spect to the administration of Indian coal leases are dis-

charged in accordance with the requirements of the gov-

erning mineral leasing laws, treaties, and lease terms.”

52 Fed. Reg. 1840 (Jan. 15, 1987) (stating purpose and

background of proposed rulemaking notice); 30 C.F.R.

§ 206.250(d) (1989). Therefore, the purposes of the as-

serted network of statutes and regulations support find-

ing a fiduciary relationship between the government and

the Nation that is money-mandating under the Indian

Tucker Act.

The government appears to rely on the statement in

Navajo [1], 537 U.S. at 508, 123 S. Ct. 1079, that the

IMLA of 1938 “aims to enhance tribal self-determination

by giving Tribes, not the Government, the lead role in

negotiating mining leases with third parties.” While “we

cannot ignore the tension between IMLA’s two objec-

36a

tives,” Navajo III, 537 U.S. at 517, 123 S. Ct. 1079

(Souter, J., dissenting), this court would err through

overbroad application of the Navajo II] holding. The

Court in Navajo I/1 interpreted the government’s duties

based only on the IMLA of 1938 and its regulations,

IMDA of 1982, and 25 U.S.C. § 399. None of these three

statutes are part of the asserted network of statutes and

regulations discussed in supra, Part III.D, that forms

the basis of the Nation’s money-mandating claim in this

appeal.

F. Scope and Breach of Government’s Trust Duties

Even with a substantive source of law that can fairly

be interpreted as mandating compensation for a breach

of trust, the government asserts that the breach alleged

by the Nation does not fal] within the scope of the gov-

ernment’s fiduciary trust duties. Specifically, the gov-

ernment asserts that the Nation must allege a violation

of a specific rights-creating or duty-imposing statute or

regulation and that the commen law of trusts cannot be

applied. These arguments fail for two independent rea-

sons. In addition, the undisputed facts as determined by

the Court of Federal Claims demonstrate that the gov-

ernment breached its trust duties. This court thus holds

that the Nation is entitled to judgment as a matter of

law. SmithKline, 403 F.3d at 1337 (stating that if “both

parties sought summary judgment” and if “this court

determines that no material facts remain in dispute,

{this court} may proceed to determine entitlement to

judgment under the law”).

First, the Supreme Court heard, considered, and

rejected these arguments by the government in Apache.

See Apache U.S. Br., 2002 WL 1559747, at *35-43. It is

true that in determining whether there is a “claim cogni-

37a

zable under the Indian Tucker Act,” “the analysis must

train on specific rights-creating or duty-imposing statu-

tory or regulatory prescriptions.” Navajo [11,537 US.

at 506, 123 8. Ct. 1079. “But once that focus [for the

trust relationship ijs provided, general trust law [i]s

considered in drawing the inference that Congress in-

tended damages to remedy a breach of obligation.”

Apache, 537 U.S. at 477, 123 S. Ct. 1126. The Court th..s

found in Apache that common-law trust duties helped to

define the “contours of the United States’ fiduciary re-

sponsibilities.” See id. at 474-75, 123 S. Ct. 1126.

While it is true that the 1960 Act does not, like the

statutes cited in that case, expressly subject the Gov-

ernment to duties of management and conservation,

the fact that the property occupied by the United

States is expressly subject to a trust supports a fair

inference that an obligation to preserve the property

improvements was incumbent on the United States

as trustee. This is so because elementary trust law,

after all, confirms the commonsense assumption that

a fiduciary actually administering trust property

niay not allow it to fall into ruin on his watch.

Id. at 475, 123 S. Ct. 1126. Likewise, in Mitchell I], the

Court stated that “a fiduciary relationship necessarily

arises when the Government assumes such elaborate

control over forests and property belonging to Indians.”

463 U.S. at 225, 103 S. Ct. 2961 (noting that “[a]ll of the

necessary elements of a common-law trust are present”

even though “ ‘nothing is said expressly in the authoriz-

ing or underlying statute (or othe~- fundamental! docu-

ment) about a trust fund, or a trust or fiduciary connec-

tion’” (quoting Navajo Tribe of Indians v. United

States, 224 Ct. Cl. 171, 183, 624 F.2d 981 (1980))). In

38a

this case, the government’s arguments are identical to

those it made in Apache. Therefore, this court rejects

the government’s arguments and holds that the common

law trust duties of care, candor, and loyalty help define

the fiduciary responsibilities in this case. In Navajo 7,

the Court of Federal Claims found that the government

violated these basic duties of care, loyalty, and candor

owed a beneficiary by a trustee. See 46 Fed. Cl. at

226-27 (“Let there be no mistake. Notwithstanding the

formal outeome of this decision, we find that the Secre-

tary has indeed breached these basic fiduciary duties.”).

We agree that the government violated these com-

mon-law trust duties.

Second, the asserted network of statutes and regula-

tions enumerates specific duties that the government

violated. The Navajo-Hopi Rehabilitation Act of 1950

provides that the “Tribal Councils of the Navajo and

Hopi Tribes and the Indian communities affected shall

be kept informed and afforded opportunity to consider

from their inception plans pertaining to the program

authorized,” including the “program of basic improve-

ments for the conservation and development of the re-

sources of the Navajo and Hopi Indians.” 25 U.S.C.

§§ 631, 638. Similarly, 30 C.F.R. § 750.6(d) (1987), pro-

mulgated pursuant to the Surface Mining Control and

Reclamation Act of 1977, specifically makes the Bureau

of Indian Affairs responsible for “providing representa-

tion for Indian mineral owners and other Indian land

owners in matters relating to surface coal mining and

reclamation operations on Indian lands.” In this case,

the Court of Federal Claims found that the government

met “secretly with parties having interests adverse to

those of the [Nation], adopt[ed] the third parties’ de-

39a

sired course of action in lieu of action favorable to the

[Nation], and then misle[d] the [Nation] concerning

these events.” Navajo /, 46 Fed. Cl. at 226. Under

these facts, the government violated its duty to keep the

Nation informed regarding the development of its coal

resources and to provide the Nation representation in a

matter related to coal mining operations.

In addition, the Indian lands seetion of the Surface

Minang Control and Reclamation Act of 1977 mandates

that the Secretary “shall include and enforce terms and

conditions . . . as may be requested by the Indian tribe

in such leases.” 30 U.S.C. § 1300(e); see also 30 C.F.R.

750.20 (1987) (using nearly identical language). This

language indicates Congress’ apparent desire that terms

and conditions requested by the Nation be included in

leases. Cf Agwiak v. United States, 347 F.3d 1375, 1380

(Fed. Cir. 2003) (“We have repeatedly recognized that

the use of the word ‘shall’ generally makes a statute

money-mandating.”). The Nation has cited legislative

history to support this interpretation: “This is Indian

land. There is a section in this bill that deals specifically

with how the Indians will be protected, and so forth, as

they negotiate.” 123 Cong. Rec. $15,575 (daily ed. May

19, 1977) (statement of Sen. Goldwater). In this case,

the Nation’s request was reasonable. The Nation did

not ask the Secretary to incorporate an outrageous term

or condition. Rather, the Nation asked that the royalty

rate be adjusted to a reasonable level, and Peabody had

consented to such a reasonable adjustment explicitly in

Lease 8580. Prior to the ex parte interference, the Bu-

reau of Indian Affairs had deemed proper and approved

an increase in the royalty rate to 20%. Despite the man-

date of § 1300(e) and the Nation's request for an adjust-

ment to a reasonable royalty rate, however, it is undis-

40a

puted that Secretary Hodel refused to make this royalty

adjustment permanent after meeting with Peabody’s

representative, whom the government conceded was “a

former aide and friend of Secretary Hodel.” The Nation

thus entered negotiations with Peabody “unarmed with

critical knowledge” and unaware “that it no longer had

[a] competitive edge in its bargaining while the compa-

nies were well aware of the fact.” Navajo /, 46 Fed. Cl.

at 227 . “Then after very briefly reviewing the merits of

the proposals, the Secretary approved lease amend-

ments with royalty rates well below the rate that had

previously been determined appropriate by those agen-

cies responsible for monitoring the federal government’s

relations with Native Americans.” /d. at 226-27. Under

these facts, the government violated its duty to include

and enforce terms and conditions requested by the Na-

tion.

Similarly, in Escondido Mutual Water Co. v. La

Jolla Band of Mission Indians, 466 U.S. 765, 104 S. Ct.

2105, 80 L. Ed. 2d 753 (1984), the Supreme Court held

that requested terms must be incorporated where man-

dated by a statute. The statute at issue in Escondido

placed a specific condition on the power of the Federal

Energy Regulatory Commission (“Commission”) to issue

licenses for “hydroelectric project works located on the

public lands and reservations of the United States, in-

cluding lands held in trust for Indians.” Jd. at 767, 104

S. Ct. 2105. Specifically, § 4(e) of the Federal Power

Act, 41 Stat. 1066 (codified as amended at 16 U.S.C.

§ 797(e)), stated that the licenses “shall be subject to and

contain such conditions as the Secretary of the depart-

ment under whose supervision such reservation falls

shall deem necessary for the adequate protection and

utilization of such reservations” (emphasis added).

4la

Based on this statutory language, the Court stated that

“Congress’ apparent desire that the Secretary’s condi-

tions ‘shall’ be included in the license must therefore be

given effect unless there are clear expressions of legisla-

tive intent to the contrary.” /d. at 772, 104 S. Ct. 2105.

Finding that Congress “was no doubt interested in cen-

tralizing federal licensing authority into one agency”

and that “it did not intend to relieve the secretaries of

all responsibility for ensuring that reservations under

their respective supervision were adequately protected,”

the Court concluded that there was no clear legislative

intent to the contrary. See id. at 773-75, 104 S. Ct. 2105.

In addition, the Court was untroubled by the ability of

the Secretary to require “the Commission to include the

Secretary’s conditions in the license over its objection”

because the statute limited the types of conditions that

the Secretary could require to those “reasonably related

to the protection of the reservation and its people.” See

id. at 776-79, 104 S. Ct. 2105.

The government appears to assert that the Secre-

tary’s duty to include and enforce terms and conditions

requested by the Nation under § 1300(e) is limited to

environmental protection standards. It is true that the

Surface Mining Control and Reclamation Act of 1977

focuses on environmental protection, not royalty rates.

Neither § 1300(e) nor its companion regulation, how-

ever, contains any subject matter limitation. The gov-

ernment also asserts that § 1300(e) does not apply be-

cause Lease 8580 did not issue after August 3, 1977. The

government, however, fails to note the lease amend-

ments, which the parties executed and the Secretary

approved after August 3, 1977. While § 1300(e) and its

companion regulation do not specify whether the statu-

tory requirement should apply to the lease amendments

42a

in this case, this court concludes in the affirmative. The

lease amendments to Lease 8580 did not incorporate a

minor change. Rather, the package of amendments ad-

justed the royalty rates for three different leases, re-

solved a broad range of issues between Peabody and the

Nation, and added 90 million tons of coal to the 200 mil-

lion tons originally leased from the Nation’s reservation

lands in Arizona. Without its exhibits, the amendments

numbered more pages than the original Lease 8580.

Therefore, while an amendment in form, the agreement

was in substance a new lease. Indeed, within the agree-

ment, the parties acknowledged that the parties could

have executed a separate lease or leases to address the

same issues, and that they chose to do so instead in a

document that amended Lease 8580. Under these cir-

cumstances, this court holds that § 1300(e) applied to the

lease amendments at issue in this case and thus, im-

posed a duty on the Secretary to include and enforce a

reasonable royalty rate.

[V.

For the foregoing reasons, we conclude that the net-

work of statutes and regulations asserted by the Nation

identify substantive sources of law that establish specific

trust duties and can fairly be interpreted as mandating

compensation for damages sustained. as a result of a

breach of the duties imposed by the governing law. In

addition, we conclude that the Nation has alleged and,

based on the undisputed factual findings of the Court of

Federal Claims in Navajo /, has demonstrated that the

government violated its common law trust duties of care,

candor, and loyalty; its duty under the Navajo-Hopi Re-

habilitation Act. of 1950 to keep the Nation informed

regarding the development of its coal resources; its duty

43a

under the regulations promulgated pursuant to the Sur-

face Mining Control and Reclamation Act of 1977 to pro-

vide the Nation representation in a matter related to

coal mining operations; and its duty under the Indian

Lands section of the Surface Mining Control and Recla-

mation Act of 1977 to include and enforce terms and con-

ditions requested by the Nation.

Accordingly, this court holds that the Nation has a

cognizable money-mandating claim against the United

States for the alleged breaches of trust and that the gov-

ernment breached its trust duties. We reverse the order

of the Court of Federal Claims and remand for further

proceedings consistent with this opinion.

REVERSED and REMANDED

Each party shall bear its own costs for this appeal.

44a

APPENDIX B

UNITED STATES COURT OF FEDERAL CLAIMS

No. 98-763L

THE NAVAJO NATION, PLAINTIFF

Vv.

UNITED STATES OF AMERICA, DEFENDANT

Dec. 20, 2005

OPINION

BASKIR, Judge.

This case has been presented to us on remand from

the U.S. Court of Appeals for the Federal Circuit. In

brief, the Plaintiff's Complaint charges a trust or con-

tract violation in the Secretary of the Interior’s approval

of coal lease amendments viewed as detrimental to the

Navajo Nation, primarily in the establishment of a roy-

alty rate of 12.5 and not 20 percent of the lessee’s gross

revenues. The Navajo Nation claims damages in the

amount of $600 million have resulted from the Govern-

ment’s breach. We refer the reader to the very detailed

summary of the Plaintiff's claims as set forth in our ini-

tial Opinion. See Navajo Nation v. United States, 46

Fed. Cl. 217 (2000) (Navajo /).

45a

In that Opinion, we ruled in favor of the Government

on cross-motions for summary judgment and dismissed

the Navajo Nation’s Complaint on what amounted to

jurisdictional grounds. The Plaintiff argued then, as it

does now, that jurisdiction is established by virtue of the

trust relationship that exists between the United States

and the Navajo Nation. In this Opinion, we respond to

questions addressed to us by the Court of Appeals on

remand. First, however, we must relate the procedural

history of the case in order to put the remand in its

proper context.

PROCEDURAL BACKGROUND

The question presented initially during summary

judgment proceedings and now on remand rests entirely

on the legal interpretation of the treaties, statutes and

regulations that form the basis for the trust duties alleg-

edly breached.

Jurisdiction in Indian trust cases is determined by

the level of governmental control and supervision of the

trust property involved—in this case, royalties from coal

leases. Presented with the task of determining where

the Plaintiff’s claims fit within a spectrum of Indian

trust cases, we found “that the Secretary’s role in the

Navajo’s coal leasing—that is, his control or supervision

of coal leasing—falls far short of the detailed fiduciary

responsibilities of Mitchell 11, Pawnee, and Brown, on

the one hand, and is more akin to the general fiduciary

responsibilities addressed in Mitchell ] and Wright, on

the other.” Navajo I, 46 Fed. Cl. at 234-35.

The Plaintiff successfully appealed to the U.S. Court

of Appeals for the Federal Circuit. On August 10, 2001,

a divided panel of the Court of Appeals arrived at the

opposite conclusion, finding that the primary stztute

46a

relied upon by the Navajo Nation—the Indian Mineral

Leasing Act of 1938, 52 Stat. 347 (1938), 25 U.S.C.

§§ 396a-396g—and its implementing regulations demon-

strated pervasive control by the United States over In-

dian mineral leasing activities. Navajo Nation v. United

States, 263 F.3d 1325, 1831 (Fed. Cir. 2001) (Navajo

ITI). But see, id. at 1333 (concurring in part and dis-

senting in part, Schall, C.J.). The majority concluded:

The United States breached its fiduciary obligations

to the Navajo Nation in connection with these coal

leases with Peabody. A claim for damages for that

breach is within the jurisdiction of the Court of Fed-

eral Claims. The dismissal is reversed, and the case

is remanded for further proceedings including deter-

mination of damages.

Navajo III, 263 F.3d at 1333. The Court’s judgment so

stated. Subsequent attempts by the Government to gain

rehearing and reconsideration en banc were denied on

November 16, 2001. On November 23, 2001, the Court

issued its mandate formally reversing our judgment and

remanding the case.

However, the Defendant successfully petitioned for

certiorari, United States v. Navajo Nation, 535 U.S.

1111, 122 S. Ct. 2326, 153 L. Ed. 2d 158 (2002), and the

case was argued before the Supreme Court on Decem-

ber 2, 2002. Relying upon the same rationale initially

advanced by this Court, the Supreme Court concluded

that the “controversy here falls within Mitchell I’s do-

main.” United States v. Navajo Nation, 537 U.S. 488,

493, 123 S. Ct. 1079, 155 L. Ed. 2d 60 (2003) (Nawajo TV).

The majority opinion closed with the following:

47a

However one might appraise the Secretary’s inter-

vention in this case, we have no warrant from any

relevant statute or regulation to conclude that his

conduct implicated a duty enforceable in an action

for damages under the Indian Tucker Act. The judg-

ment of the United States Court of Appeals for the

Federal Circuit is accordingly reversed, and the case

is remanded for further proceedings consistent with

this opinion.

Id. at 514, 123 S. Ct. 1079. The Supreme Court’s man-

date thus vacated the Federal Circuit’s order, effectively

reinstating the judgment of the Court of Federal

Claims.

Upon remand to the Circuit Court, the case’s appel-

late posture was back to “square one”—the Plaintiff’s

unresolved appeal of an adverse trial court judgment

dismissing the Complaint for lack of subject matter ju-

risdiction. Upon consideration of the Supreme Court’s

decision, the Court of Appeals ordered that:

(1) The mandate is recalled and the appeal is rein-

stated.

(2) The case shall be returned for consideration to

the original merits panel.

Order (Oct. 24, 2003). At this point, however, the panel

declined to act on the merits of the Navajo appeal. The

original appellate panel, again divided but along differ-

ent lines, reasoned that the Supreme Court's decision

“in this case was limited to the question of whether [the

Indian Mineral Leasing Act of 1938, (IMLA) 52 Stat.

347, 25 U.S.C. § 396a et seq.] imposes judicially enforce-

able duties upon the United States in connection with

48a

the Peabody lease.” Navajo Nation v. United States,

347 F.3d 1327, 1332 (Fed. Cir. 2003) (Navajo V). The

panel further observed of the Supreme Court’s disposi-

tion:

[Ijn deciding that issue, the Court stated that 25

U.S.C. § 399 does not govern the lease and that the

lease “falls outside IMDA’s [the Indian Mineral De-

velopment Act of 1982, 25 U.S.C. § 2101 et seq.] do-

main.”

The Court did not decide whether, apart from IMLA,

section 399, and IMDA, “a network of other statutes

and regulations” imposes judicially enforceable du-

ties upon the United States in connection with the

lease.

Id. The Court, however, did not immediately address

the merits of that position. Instead the Federal Circuit

sought further consideration of the question of jurisdic-

tion. On March 16, 2004, the divided panel’s remand

order to us was issued as a mandate with the following

direction:

¢ Inthe first instance, the Court should determine

whether, as the Government asserts, the Tribe

waived a claim with respect to “a network of

other statutes and regulations.”

¢ Ifthe Court determines that such a claim was not

waived, it should decide whether, apart from

IMLA, section 399, and IMDA, a ‘network of

other statutes and regulations’ imposes ‘judicially

enforceable fiduciary duties upon the United

States’ in connection with the Peabody lease and,

if so, whether such duties were breached.

49a

ld. But see, id. at 1832-35 (Newman, C.J. dissenting in

part, on the basis that IMLA and IMDA should not be

excluded from consideration upon remand). We note

that the Court of Appeals in its remand to us did not

vacate or reverse this Court’s judgment, now restored

by virtue of the Supreme Court’s decision.

DISCUSSION

I. Waiver:

Pursuant to the remand, our first order of business

is to consider whether the Plaintiff’s “network” theory

survives the waiver doctrine. Navajo V, 263 F.3d at

1332. Generally, a federal appellate court does not con-

sider an issue not passed upon below. Singleton v.

Wulff, 428 U.S. 106, 120, 96 S. Ct. 2868, 49 L. Ed. 2d 826

(1976). The waiver doctrine is intended to prevent un-

fair surprise and corresponding prejudice to the oppos-

ing party. See id. (doctrine is “essential in order that

parties may have the opportunity to offer all the evi-

dence they believe relevant to the issues . . . [and] in

order that litigants may not be surprised on appeal by

final decision there of issues upon which they have had

no opportunity to introduce evidence.”) (quoting Hormel

v. Helvering, 312 U.S. 552, 556, 61 S. Ct. 719, 85 L. Ed.

1037 (1941)).

There is no hard and fast rule on waiver. As the Su-

preme Court has directed, “(t]he matter of what ques-

tions may be taken up and resolved for the first time on

appeal is one left primarily to the discretion of the

courts of appeals, to be exercised on the facts of individ-

ual cases.” /d. Here the Federal Circuit has seemingly

delegated that function to us. As an initial matter, we

note that typical concerns in waiver cases are allayed in

50a

this instance. First, as we describe below, the “net-

work” argument, if not the specific components of this

network, was considered and rejected by this Court. See

e.g., Trierweiler v. Croxton and Trench Holding Corp.,

90 F.3d 1523, 1538 (10th Cir. 1996) (distinguishing Sin-

gleton on the basis that the district court implicitly ad-

dressed the issue, the appellant explicitly challenge.’ the

court’s determination in his appellate brief and the ap-

pellees declined the opportunity to respond). Secondly,

the Tribe’s “argument concerns a purely legal question,”

thus “mitigat{ing] the force of the considerations under-

lying the policy of refusing to consider issues not raised

below.” Jd. (citing Stahmann Farms, Inc. v. United

States, 624 F.2d 958, 961 (10th Cir. 1980)).

Preservation ef issues for appeal “does not demand

the incantation of particular words; rather, it requires

that the lower court be fairly put on notice as to the sub-

stance of the issue.” Consolidation Coal Co. et al. v.

United States, 351 F.3d 1374, 1378 (Fed. Cir. 2003). The

Plaintiff has always asserted that a jurisdictional trust

was created by the so-called “network,” what it some-

times described as the “comprehensive statutory and

regulatory scheme.” In the allegations within the Com-

plaint, the Navajo Nation described the network:

The leasing of coal of the Navajo Nation is subject to

a comprehensive statutory and regulatory scheme of

the United States, executed by the agencies of the

United States including the Bureau of Indian Affairs,

the Office of Surface Mining Reclamation and En-

forcement, the Bureau of Land Management, the

Minerals Management Service and other agencies.

Complaint at { 20. This paragraph of the Complaint

goes on to cite not only IMLA and IMDA, but also the

—

dla

Federal Oil and Gas Royalty Management Act, 30

U.S.C. §§ 1701-1757 (FOGRMA), as well as regulations

promulgated under the Surface Mining Control and Rec-

lamation Act of 1977, 30 U.S.C. § 1201 et seg., (SMCRA)

—each components of the network theory asserted on

remand. /d. Also invoked by the Tribe’s pleadings is

the Navajo and Hopi Rehabilitation Act of 1950, 25

U.S.C. §§ 631-38, another key authority in its remand

brief. See Complaint at 1 21 (“The United States has

adopted specific policies under the Navajo and Hopi Re-

habilitation Act of 1950 to promote interests of the Na-

vajo Nation.”)

In the network proposed in its remand briefs, Plain-

tiff includes the following: 25 U.S.C. § 2 and 25 U.S.C.

§ 177; two treaties between the United States and the

Navajo Tribe of Indians, 9 Stat. 974 (1849) and 15 Stat.

667 (1868); the Navajo and Hopi Rehabilitation Act of

1950, 25 U.S.C. §§ 631-38; SMCRA, in particular, the

Indian Lands section, 30 U.S.C. § 1300, and the imple-

menting regulations, 25 C.F.R. Parts 200, 216, subpart

B, and 30 C.F.R. Parts 750 and 955; FOGRMA and im-

plementing regulations applying its oil and gas provi-

sions to Indian coal, 30 C.F.R. § 206.450 and 30 C.F.R.

§ 211.4; the Indian Right-of-Way Statute, 25 U.S.C.

§§ 323-328, and implementing regulations found at 25

C.F.R. Part 169; and, contrary to the express terms of

the mandate, IMLA, and the regulations implementing

it, 25 C.F.R. Parts 211 and 216 subpart A and 43 C.F.R.

Part 3480. Indeed, with minor exceptions the legal in-

struments cited by the Navajo Nation have always con-

sisted of the same references.

The initial briefs filed by the Navajo Nation included

an Appendix with the sub-caption “Constitutional Provi-

52a

sions, Treaties, Statutes and Regulations; Exhibits

1-128.” This particular volume of Plaintiff’s Appendix

(there were two volumes) includes 97 pages of statutes,

regulations, treaties, executive orders and internal poli-

cies. All but one of the authorities cited now on re-

mand—25 U.S.C. § 2—were previously cited by the Na-

vajo Nation.

For the most part, these statutes and regulations

were not discussed in the parties’ briefs, however.

Where they were cited it was often to demonstrate the

general] trust relationship that existed with respect to

Indian tribal resources and the Federal Government.

See e.g., Pl. Mot. for Summary Judgment on the Issue of

Liability on its First Claim for Relief (Dec. 15, 1997)

(“Pl. Mot. for Summary Judgment”) at 33 (Citing the

Navajo and Hopi Rehabilitation Act, Plaintiff argued

“Congress passed special legislation designed to combat

the poverty and demoralization of the Navajo Tribe, to

create a self-supporting Navajo economy, and to allow

Navajos to attain a decent standard of living.”).

The regulatory provisions relied upon by the Plaintiff

were likewise not given extended treatment in earlier

attempts to establish a compensable trust. Yet the “net-

work” theme was always present even in its supporting

role vis 4 vis IMLA, as the following excerpts from

Plaintiff’s briefs demonstrate. In its initial brief, the

Plaintiff stated:

DOI has promulgated comprehensive regulations

governing every aspect of mineral leasing and pro-

duction on reservation land (citation omitted). These

regulations assign the responsibilities for carrying

out the Government’s comprehensive authority over

the Indian mineral] leasing to BIA and several other

53a

DOI agencies. See 25 C.F.R. Part 211 (1985) (pros-

pecting, leasing procedures, substantive lease terms

and conditions, payments of rents and royalties, and

regulation of operations); 25 C.F.R. Part 216 (1985)

(surface coal mining exploration, mining plans, oper-

ations and reclamation of Indian lands); 25 C.F.R.

Part 169 (1985) (governing rights-of-way); 25 C.F.R.

Part 200 (1993) (incorporation into Indian coai leases

of terms and conditions regarding reclamation).

Pl. Br. in Support of Summary Judgement (Dec. 15,

1997) at 33-34. In its opposition to the Government’s

cross-motion, Plaintiff argued:

This Court has jurisdiction over the Navajo Nation’s

claims here. In the 1849 Treaty with the Navajo, the

United States promised always to “act . . . to se-

cure the permanent prosperity and happiness of [the

Navajo people].” In the 1849 Treaty, the 1938 Indian

Mineral Leasing Act, and relevant DOI regulations,

the United States undertook the “exclusive right of

regulating trade and intercourse” with the Navajo,

and developed a comprehensive federal scheme that

controls every aspect of the management of Navajo

coal resources. “These regulations detail in exhaust-

ing thoroughness the government's management and

regulatory responsibilities.” Under that compvehen-

sive scheme, the Department in 1964 approved the

8580 Lease, which granted exclusive authority to the

Secretary of the Interior to adjust the royalty rate to

a reasonable level after 20 years.

Navajo Nation’s

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