# Amicus Curiae Brief — BP America Production Co. v. Burton

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URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385016_0233%3A15

## Record

- **Collection:** Supreme Court brief
- **Document type:** Amicus Curiae Brief
- **Published:** January 1, 2006
- **Citation:** 549 U.S. 84

## Text

Swine oul, Uo. '

= FILED
ay JU; 13 2006
No. 05-669 OFFICE OF (HE CLERK
In The
Supreme Court of the Anited States
r
BP AMERICA PRODUCTION COMPANY
and ATLANTIC RICHFIELD COMPANY,
Petitioners,

V.

REBECCA W. WATSON, Assistant Secretary of
the Interior for Land and Mineral Management, et ai.,

Respondents.

¢

On Writ Of Certiorari To The
United States Court Of Appeals
For The District Of Columbia Circuit

S

AMICUS CURIAE BRIEF OF
MOUNTAIN STATES LEGAL FOUNDATION
IN SUPPORT OF PETITIONERS

o

WILLIAM PERRY PENDLEY*
*Counsel of Record

JOEL M. SPECTOR

MOUNTAIN STATES LEGAL FOUNDATION

2596 South Lewis Way

Lakewood, Colorado 80227

(303) 292-2021

Attorneys for Amicus Curiae

\

COCKLE LAW BRIEF PRINTING CO. (800) 225-6964
OR CALL COLLECT (402) 342-2831

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QUESTION PRESENTED

Whether - contrary to the decision below, but consis-
tent with the decisions of the Tenth ard Federal Circuits —
the limitations period in 28 U.S.C. § 2415(a) applies to
federal agency orders requiring the payment of money
claimed under a lease or other agreement?

TABLE OF CONTENTS

Page
TTL A OO RAFT icc insisescsscostecsesasse iii
IDENTITY AND INTEREST OF AMICUS CURIAE... 1
OPINIONS BELOW AND JURISDICTION............-.-+. 2
STATEMENT OF THE CASE...........cccccssecssesesesesesesenees 2
SUMMARY OF THE ARGUMENT ...........:ceccce0eseseseeees 4
FREE A ee CPR Re CONE ETD 4

I. THE TEXT OF 28 U.S.C. § 2415(a) PLAINLY
MEANS, WHEN AIDED BY THE CANON IN
PARI MATERIA, THAT AGENCY ORDERS
FALL WITHIN THE PURVIEW OF THE
STATUTE OF LIMITATIONS. ...............:ccceeeceeees 6

Il. THE HOLDING OF THE D.C. CIRCUIT
COURT OF APPEALS YIELDS AN ABSURD
RESULT AND OUGHT TO BE REVERSED.... 8

Ill. THE STATUTE OF LIMITATIONS, 28 U.S.C.
§ 2415(a)} SHOULD NOT BE STRICTLY
CONSTRUED IN FAVOR OF THE GOVERN-

A. The Purpose Of The Canon Of Construc-
tion Was Rejected By Congress When 28
U.S.C. § 2415(a) Was Debated, Thus The
Canon Ought Not Be Applied In This In-
PRON cinciscinininiintsLivinniciigtnhacmaibpimisistgeiesiietiiininn 10

B. The Canon Of Construction Whereby Stat-
utes Of Limitations Are To Be Strictly
Construed In Favor Of The Government,

Is [logical And Should Not Be Applied
Under Any Circumstances...............::ss0s00 12

CONCLUSION .............. sesvsesseseneseconssnsneeneenennsanenscnceneanes 15

TABLE OF AUTHORITIES
Page
CASES
Agostini v. Felton, 521 U.S. 203 (1997).........:cccscseerreeeeees 13
Albrecht v. Herald Co., 390 U.S. 145 (1968) ............ceccceeee 13
Amoco Production Co. v. Baca, 300 F.Supp.2d 1
IRN MII sins is init dschicinc ince pabetbstinknne ieghamaocbanadesbineniabeeeadin 3
Amoco Production Co. v. Watson, 410 F.3d 722 (D.C.
SK See iciticcicsicdcclieisisininniindndsdbdnenebeitgipivicapesdadeaiinahiaiiiee 4,6
Barnhart v. Sigmon Coal Co., Inc., 534 U.S. 438
SE RR aE Ie MET i haem eS SCA RE Bat Ng Sp eres Bala Ai 4, 6,7
Bell v. Morrison, 26 U.S. (1 Pet.) 351 (1828) .................... 10
Bendix Autolite Corp. v. Midwesco Enterprises, Inc.,
a eoinctctncctidetimirithitnmndniinn 11
Board of Regents of University of State of N.Y. v.
Tomanio, 446 U.S. 478 (1980) ........scecsereessenereeneneneenens 11
Booth v. Maryland, 482 U.S. 496 (1987).........ccccsecseeeeees 13
Bowers v. Hardwick, 478 U.S. 186 (1986).....................2.6 12
Branch v. Smith, 538 U.S. 254 (2008)...0...........ceeceeeee eee 5, 7
Connecticut Nat. Bank v. Germain, 503 U.S. 249
Sa Cachchdecinkinsstibipdshidsiedlinlasadhiehidseithscitediedetidabdntaiieiidtinshddéathdeoied 9
Dickerson v. U.S., 530 U.S. 428 (2000) .................ccceeeeeeee 12
E.L. DuPont de Nemours & Co. v. Davis, 264 U.S.
PR I covdinsistcnstoiticdeaidnto dipbulnnbetnithiinieiiabantndasniadhbeighanendatnes 6
Germantown Pass. Ry. Co. v. Citizens’ Pass. Ry. Co.,
24 A. 1103, 151 Pa. 138 (Pa. 1892)..................scecccesesseres 14

Gunn v. Principal Cas. Ins. Co., 605 So.2d 741
SN, THIN \iehicisdivadsicrtinupcvpidiirinsdpsntcnandadaiinnnnbchebnanibibaenin 14

iv

TABLE OF AUTHORITIES - Continued

Page
Household Credit Services, Inc. v. Pfennig, 541 U.S.

LR Ra RR Ue ee MY PTE ER Fen SERRE Te 9
K Mart Corp. v. Cartier, Inc. , 486 U.S. 281 (1988).......... 5, 7
Lawrence v. Texas, 539 U.S. 558 (2003)..................000 12, 13
Order of Railroad Telegraphers v. Railway ites

Agency, Inc., 321 U.S. 342 (1943) .........:cscscsssesseeneceenes 10
OXY USA, Inc. v. Babbitt, 268 F.3d 1001 (10th Cir.

TET nites cavitwoscessscedp:chelerciiastiniiedidedipsneliieliiadingashs itis Gadde mi 8,9
Payne v. Tennessee, 501 U.S. 808 (1991)......... cece eee 13
Smith v. City of Jackson, Miss., 544 U.S. 228 (2005)....... 12
South Carolina v. Catawba Indian Tribe, Inc., 476

a Be CD nincinsichchntvtinad incinssisatiteiessteiiteatichinilpsiaichdiasititinile 12
South Carolina v. Gathers, 490 U.S. 805 (1989)............... 13
State Oil Co. v. Khan, 522 U.S. 3 (1997).......c.cesesssseseseseees 13
Stenberg v. Carhart, 530 U.S. 914 (2000) ............. ce eeeeeeeeees 5
U.S. v. Freeman, 3 How. 556, 11 L.Ed. 724 (1845) ............. 5
U.S. v. Hanover Insurance Co., 82 F.3d 1052 (Fed.

Sie, SP cciidickéssiinntipsitcainiiicishtaneneiialbiliaidctaia alas alia ditatiieis 7,12
U.S. v. Menasche, 348 U.S. 528 (1955) ..............ccccecceeseeeeeee 7
U.S. v. Nashville, C. & St. L. Ry. Co., 118 U.S. 120

CBD sceciccicnociinsicheisveislniptiniicsabibsindisatadamsinomtnlst etal 11
U.S. v. Riverside Bayview Homes, Inc., 474 U.S. 121

CIID inc icnissibiicsnisoctsibaiacipcetpihttacesieidbionehcandnicasaiad deiiiiatialtaieahialoniaiietaaae 7
U.S. v. Seckinger, 397 U.S. 203 (1970)...........:cccesseesseeeeees 14
Walker v. Armco Steel Corp., 446 U.S. 740 (1980)............ 10

Watt v. Alaska, 451 U.S. 259 (1981).........cccecesereeeserseeeneens 5

TABLE OF AUTHORITIES - Continued

Page

STATUTES
EIR Ws SERPS CSW eae EASON e passim
aes ocine teen ceatinlnceninencenneumniningeis 3,7
I I a oi senemllnapensbnbasoincasetebaiibs 3, 5
ESTEE OO a OTE eS 13
I i dalle nici dh tigdemmemnnntineniiieiceti dente
Mineral Leasing Act, 30 U.S.C. § 181 ef seq. .......0...ccceeeeeees 2
RULES
Supreme Court Rule 37(2)(a) ........cccccccccecesseesesereeneeesennenerss 1
Supreme Court Rule 3716) ........ccccrcccccscrcccsssesessecesescscossesees 1
OTHER AUTHORITIES
Antonin Scalia, A Matter of Interpretation: Federal

Courts and the Law 28 (Princeton University

ITI th nsicesittcteiiahhnandaategittnananianiptivedainanisdiimteesentisicts 15
Black’s Law Dictionary 328 (7th ed. 1999) ..............ccccccees 14
Farnsworth on Contracts § 12.8, at 871 (2d ed. |

Re ERS EI ES Rea a eG Cnn ORT oe 8
Larry A. DiMatteo, Equity’s Modification of Con-

tract: An Analysis of the Twentieth Century's Eq-

uitable Reformation of Contract Law, 33 New

Eng. L. Rev. 265, n.584 (Winter 1999) .000..........ccccceeeees 14
Restatement (Second) of Contracts § 206 (1981).............. 14,

Victor E. Schwartz, et al., Prosser, Wade &
Schwartz’s Torts Cases and Materials 613-619

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1

AMICUS CURIAE BRIEF OF MOUNTAIN
STATES LEGAL FOUNDATION
IN SUPPORT OF PETITIONERS

Mountain States Legal Foundation (“MSLF ”) respect-
fully submits this amicus curiae brief in support of Peti-
tioners. Pursuant to Supreme Court Rule 37(2)a), this
amicus curiae brief is filed with the written consent of all
the parties.’

S

IDENTITY AND INTEREST OF AMICUS CURIAE

MSLIF is a non-profit, public interest legal foundation
organized under the laws of the State of Colorado. MSLF
is dedicated to bringing before the courts those issues vital
to the defense and preservation of private property rights,
individual liberties, limited and ethical government, and
the free enterprise system. MSLF’s members include
businesses and individuals who live and work in nearly
every state of the country.

Many of MSLF’s members own natural gas operations
pursuant to federal leases that are subject to royalty
payments like those at issue in this case. Because MSLF
and its members have a significant interest in the outcome
of this case, MSLF respectfully submits this brief in
support of Petitioners.

¢

* A copy of Respondents’ consent letter has been filed with the Clerk
of the Court; and Petitioners filed a blanket consent. In compliance with
Supreme Court Rule 37(6), MSLF represents that no counsel for any
party authored this brief in whole or in part and that no person or entity,
other than the amicus curiae, its members, or its counsel made a
monetary contribution to the preparation or submission of this brief.

2

OPINIONS BELOW AND JURISDICTION

Amicus hereby adopts Petitioners’ description of the
opinions below and statement of jurisdiction. See Petition
for Writ of Certiorari at 1-14.

¢

STATEMENT OF THE CASE

In 1920, Congress enacted the Mineral Leasing Act
(“MLA”), 30 U.S.C. § 181, et seg., to authorize the U.S.
Department of the Interior (“DOI”) to issue and administer
oil and gas leases for federal lands. 30 U.S.C. §§ 181-287.
To operate oil and gas leases on federal lands, lessees are
required to pay a royalty to the Mineral Management
Service (“MMS”), a division of the DOI, that is based on
the value of the gas.

Petitioners own such leases and have consistently
been subject to the royalty payment requirement. On April
22, 1996, the MMS issued a “Dear Operator/Payor” Letter
to producers of coalbed methane (“CBM”) gas in the
vicinity of New Mexico’s San Juan Basin. The 1996 Payor
Letter provided new “guidelines” to producers on how to
report and pay these royalties. Specifically, the MMS
claimed a royalty entitlement based on the enhanced value -
of CBM after transportation to downstream treatment
facilities and treatment in those facilities to meet mainline
pipeline quality requirements. The 1996 Payor Letter
asserted that, for royalty purposes, the CBM’s “value” may
not be reduced to account for the costs of placing it in
marketable condition, and that the CBM was not in
marketable condition until it was transported to and
treated in gas treatment plants to meet the quality specifi-
cations of mainline pipelines.

3

On May 27, 1997, the MMS issued an order directing
Petitioners to pay additional royalties of $4,117,607
because, according to the MMS, Petitioners had calculated
and paid royalties improperly dating back to 1989. The
order also imposed penalties of up to $10,000 per day for
failure to comply with the order.

Petitioners believe that such a demand violates 28
U.S.C. § 2415(a), which provides, in part:

Subject to the provisions of section 2416 of this
title, and except as otherwise provided by Con-
gress, every action for money damages brought
by the United States or an officer of agency
thereof which is founded upon any contract ex-
press or implied in law or fact, shall be barred
unless the complaint is filed within six years af-
ter the right of action accrues or within one year
after final decisions have been rendered in appli-

cable administrative proceedings ce scestea by
contract or by law, whichever is later .

This statute of limitations was not included initially
in the MLA, but was added in 1966 and then amended in
1982 to include the phrase, “|t)he provisions of this section
shall not prevent the United States or an officer or agency
thereof from collecting any claim of the United States by
means of administrative offset, in accordance with section
3716 of title 31.” 28 U.S.C. § 2415(i).

After exhausting administrative remedies, Petitioners
filed suit in the United States District Court for the
District of Columbia, which concluded that the statute of
limitations does not apply to agency efforts to impose and
collect additional royalties through agency proceedings.
Amoco Production Co. v. Baca, 300 — 1, 21 (D.D.C.
2003).

4

The United States Court of Appeals for the District of
Columbia affirmed this decision, holding that “an adminis-
trative order assessing additional royalties” cannot rea-
sonably be understood to be an “action for money
damages” initiated by the filing of a complaint. Amoco
Production Co. v. Watson, 410 F.3d 722 (D.C. Cir. 2005).
Thereafter, Petitioners filed their Petition for Writ of
Certiorari with this Court, which was granted on April 17,
2006.

S

SUMMARY OF THE ARGUMENT

Agency orders, such as the MMS’s order to Petition-
ers, fall within the plain meaning of 28 U.S.C. § 2415(a),
and, therefore, this Court should reverse the holding of the
D.C. Circuit Court. This conclusion is supported by this
Court’s doctrine that eschews absurd results, such as
concluding that administrative agencies may attempt to
collect money though the administrative process while
being barred from collecting that money through litiga-
tion. In addition, the D.C. Circuit wrongly adhered to a
canon of construction, which provides that statutes of
limitations are to be strictly construed in favor of the
government, that is inapplicable both in this specific
instance and universally. As a result, this Court should
reverse the decision of the D.C. Circuit and hold that
administrative orders do fall within the purview of the
statute of limitations.

¢

ARGUMENT

Statutes must be interpreted based on the plain
meaning of the statutory text. Barnhart v. Sigmon Coal

5

Co., Inc., 534 U.S. 438, 450 (2002) (“As in all statutory
construction cases, we begin with the language of the
statute.”); Stenberg v. Carhart, 530 U.S. 914, 983 (2000)
(Scalia, J., concurring in judgment in part and dissenting
’ in part). “In ascertaining the plain meaning of [a] statute,
the court must look to the particular statutory language at
issue, as well as the language and design of the statute as
a whole.” K Mart Corp. v. Cartier, Inc., 486 U.S. 281, 291
(1988). The textual canon in pari materia may be applied
to aid in the construction of the statutory text by examin-
ing the language and design of the statute as a whole.
Under this doctrine, “if divers statutes relate to the same
thing, they ought all to be taken into consideration in
construing any one of them.” Branch v. Smith, 538 U.S.
254, 281 (2003), citing U.S. v. Freeman, 3 How. 556, 564-
565, 11 L.Ed. 724 (1845). If, however, the plain meaning of
the statutory text would lead to an absurd result, this
Court has concluced that other factors may be taken into
consideration. See, e.g., Watt v. Alaska, 451 U.S. 259, 285
n.8 (1981).

This case hinges on the interpretation of 28 U.S.C.
§ 2415(a):

Subject to the provisions of section 2416 of this
title, and except as otherwise provided by Con-
gress, every action for money damages brought
by the United States or an officer or agency
thereof which is founded upon any contract ex-
press or implied in law or fact, shall be barred
unless the complaint is filed within six years af-
ter the right of action accrues or within one year
after final decisions have been rendered in appli-
cable administrative proceedings required by
contract or law, whichever is later... .

6

To determine the applicability of this statute to
Petitioners, the D.C. Circuit affirmed the District Court’s
decision in favor of the MMS because it concluded that
“the government’s demand for additional royalties is not
an. action for money damages initiated by the filing of a
complaint.” Amoco Production Co., 410 F.3d at 735. The
court ruled in favor of the MMS, in part, because “statutes
of limitations against the sovereign are to be strictly
construed [in favor of the government)].” Jd. at 734; see also
E.L. DuPont de Nemours & Co. v. Davis, 264 U.S. 456, 462
(1924) (In the absence of congressional enactment clearly
imposing a statute of limitations on the government, a
statute of limitations is to be strictly construed in favor of
the government. ).

Here, a textual interpretation of the plain meaning of
the statute, aided by the canon in pari materia, mandates
that this Court reverse the opinion below. This Court’s
precedent, which eschews absurd results, supports this
conclusion, particularly when the statute of limitations, is
fairly and reasonably construed.

I. THE TEXT OF 28 U.S.C. § 2415(a) PLAINLY
MEANS, WHEN AIDED BY THE CANON IN
PARI MATERIA, THAT AGENCY ORDERS FALL
WITHIN THE PURVIEW OF THE STATUTE OF
LIMITATIONS.

The plain meaning of 28 U.S.C. § 2415(a), when aided
by the canon in pari materia, is unambiguously clear:
administrative orders fall within the purview of the
statute of limitations. Any statutory construction begins
with its plain meaning. Barnhart, 534 U.S. at 450. This
analysis requires a careful examination of both the statu-
tory text, as well as the “language and design of the

7

statute as a whole.” K Mart Corp., 486 U.S. at 291. This
Court has applied the textual canon in pari materia to
help interpret the language and design of the statute as a
whole. Under this doctrine, “if divers statutes relate to the
same thing, they ought all to be taken into consideration
in construing any one of them.” Branch, 538 U.S. at 281,
citing U.S. v. Freeman, 3 How. 556, 564-65, 11 L.Ed. 724
(1845). Further, the various provisions within one statute
should all be taken into account when interpreting a
statute. See, e.g., U.S. v. Riverside Bayview Homes, Inc.,
474 U.S. 121, 139 n.11 (1985). Applying this principle,
“when Congress includes particular language in one
section of a statute but omits it in another section of the
same Act, it is generally presumed that Congress acts
intentionally and purposely in the disparate inclusion or
exclusion.” Barnhart, 534 U.S. at 452 (internal citations
omitted).

An amendment to the statute, 28 U.S.C. § 2415(i),
expressly exempts administrative offsets from the statute of
limitations period set forth in 2415(a). An “administrative
offset” is not a judicial action. Therefore, if § 2415(a) were
limited solely to judicial actions, there would have been no
need to legislate a specific exemption for administrative
offsets, and such an exemption would yield statutory
surplusage, which is disfavored by this Court. See, e.g., U.S.
v. Menasche, 348 U.S. 528, 538-39 (1955). Notably, the
doctrine of in pari materia mandates that § 2415(i) be used
to help interpret § 2415(a). Therefore, “[e]xamination of the
language and the structure of section 2415 leaves the
conviction that, absent an express exception, Congress
intended that agencies assert their claims within six years
or lose the right to enforce them.” U.S. v. Hanover Insur-
ance Co., 82 F.3d 1052, 1055 (Fed. Cir. 1996).

fl. THE HOLDING OF THE D.C. CIRCUIT COURT
OF APPEALS YIELDS AN ABSURD RESULT
AND OUGHT TO BE REVERSED.

This Court’s precedent that eschews absurd results
further leads to the conclusion that the decision below
should be reversed. The MMS’s order, dated May 27, 1997,
demands royalty payments of $4,117,607. It also warns
that failure to pay such royalty payments could result in
penalties of up to $10,000 per day. Petition for Writ of
Certiorari, Appendix H. Should Petitioners refuse to make
any royalty payments older than six years, the MMS
would likely have to file a complaint with a court to collect
this money.

Oil and gas leases have long been recognized as
“contracts.” See, e.g., OXY USA, Inc. v. Babbitt, 268 F.3d
1001, 1006 (10th Cir. 2001). Furthermore, an award of
“damages” is the relief sought as a result of a breach of
contract. See, e.g., id. at 1008 (referencing Farnsworth on
Contracts § 12.8, at 871 (2d ed. 1990)). Therefore, for the
MMS to collect, the complaint would have to allege a
breach of contract resulting in money damages.

Once the complaint is filed to collect the royalties, the
statute of limitations would bar any claim for contract
damages beyond the six-year limitations period. By hold-
ing that the statute of limitations does not apply to agency
actions, the D.C. Circuit’s decision effectively permits the
MMS to attempt administratively what it would be unable
to accomplish judicially. This inconsistency could not
possibly have been the intent of Congress in enacting 28
U.S.C. § 2415(a), the purpose of which was to “establish a
general statute of limitations on contract claims asserted

9

by the government or a government agency.” OXY USA,
Inc., 268 F.3d at 1005. “An interpretation of § 2415 permit-
ting federal agencies to avoid the limitation period by
utilizing administrative orders to collect monies owed
under contract obviously would thwart this purpose.” Jd.
at 1006.

A similarly absurd result would exist if the MMS were
to file a complaint to compel Petitioners to pay only the
penalties for noncompliance. Though, theoretically, the
statute of limitations for the penalties would begin to run
the moment the penalties were assessed, it makes little
sense to permit the MMS to collect penalties for failure to
make a payment that the MMS is barred from collecting.
Such a result would not give the parties finality on stale
claims. Because this result would be absurd, this Court’s
ewn precedent suggests that § 2415(a) should be inter-
preted more reasonably.

Ill. THE STATUTE OF LIMITATIONS, 28 U.S.C.
§ 2415(a), SHOULD NOT BE STRICTLY CON-
STRUED IN FAVOR OF THE GOVERNMENT.

When statutes are ambiguous, this Court has relied
occasionally upon other methods of construction, such as
legislative intent and non-textual canons of construction.
See, e.g., Household Credit Services, Inc. v. Pfennig, 541
U.S. 232 (2004) (courts must give effect to the unambigu-
ously expressed intent of Congress); Connecticut Nat.
Bank v. Germain, 503 U.S. 249, 253-54 (1992) (legislative
history and other canons of construction are useful inter-
pretive tools when a statute is ambiguous). Here, these

10

additional construction tools further support the conclu-
sion that the decision below should be reversed.

Though this Court should conclude that the plain
meaning of the statute unambiguously includes adminis-
trative orders, the D.C. Circuit relied, in part, on the
canon of construction that provides that statutes of limita-
tions should be strictly construed in favor of the govern-
ment. First, this canon conflicts with the intent of
Congress, and, therefore, should not be applied in this
instance. Second, the foundation underlying this canon is
weak and the canon ought to be overturned in all in-
stances.

A. The Purpose Of The Canon Of Construction
Was Rejected By Congress When 28 U.S.C.
§ 2415(a) Was Debated, Thus The Canon
Ought Not Be Applied In This Instance.

Statutes of limitations exist to prevent limitless and
open-ended liability, see generally Victor E. Schwartz, et
al., Prosser, Wade & Schwartz’s Torts Cases and Materials
613-619 (10th ed. 2000), and to provide finality to parties’
legal obligations and relations, including contracts with
the government, as recognized by § 2415(a).’ This Court

* See also Bell v. Morrison, 26 U.S. (1 Pet.) 351, 360 (1828) (Story,
J.) (statutes of limitations guard against “stale demands, after the trust
state of the transaction may have been forgotten.”); Walker v. Armco
Steel Corp., 446 U.S. 740, 751 (1980) (“The statute of limitations
establishes a deadline after which the defendant may legitimately have
peace of mind; it also recognizes that after a certain period of time it is
unfair to require the defendant to attempt to piece together his defense
to an old claim.”); Order of Railroad Telegraphers v. Railway Express
Agency, Inc., 321 U.S. 342, 348-49 (1943) (statutes of limitations
“promote justice by preventing surprises through the revival of claims

(Continued on following page)

11

has concluded that “it is obvious that [statutes of limita-
tions] are an integral part of the legal system and are
relied upon to protect the liabilities of persons and corpo-
rations active in the commercial sphere.” Bendix Autolite
Corp. v. Midwesco Enterprises, Inc., 486 U.S. 888, 893
(1988).

Statutes of limitations also serve valid legal purposes:

Statutes of limitations are not simply technicali-
ties. On the contrary, they have long been re-
spected as fundamental to the well-ordered
judicial system ... The process of discovery and
trial ... is obviously more reliable if the witness
or testimony in questions is relatively fresh.
Thus ... there comes a point at which the delay
of a plaintiff in asserting a claim is sufficiently
likely either to impair the accuracy of the fact-
finding process or to upset the settled expecta-
tions that a substantive claim will be barred...

Board of Regents of University of State of N.Y. v. Tomanio,
446 U.S. 478, 486 (1980).

Balanced against these valid, important purposes of
statutes of limitations is the canon of construction that
provides that, in the absence of a congressional enactment,
such statutes are to be strictly construed in favor of the
government. The purpose for such a canon was to protect
the public from the prejudice that could result from the
negligence of governmental officers in their untimely filing
of claims. U.S. v. Nashville, C. & St. L. Ry. Co., 118 U.S.
120 (1886).

that have been allowed to slumber until evidence has been lost,
memories have faded, and witnesses have disappeared.”).

12

With regard to § 2415(a), however, this public purpose
was rejected by Congress, which enacted § 2415(a) “to
promote fairness ... notwithstanding whatever prejudice
might accrue thereby to the Government as a result of the
negligence of its officers.” Hanover Insurance Co., 82 F.3d
at 1055. Therefore, specifically with regard to § 2415(a),
the canon ought to be rejected, and the statute should not
be strictly construed in favor of the government. See, e.g.,
Smith v. City of Jackson, Miss., 544 U.S. 228, 262 (2005)
(Rehnquist, J., dissenting from denial of certiorari to,
instead, expressly affirm the decision, below) (“Even
venerable canons of construction must bow, in an appro-
priate case, to compelling evidence of congressional in-
tent.”); South Carolina v. Catawba Indian Tribe, Inc., 476
U.S. 498, 507 n.16 (1986) (“A canon of construction is not a
license to disregard clear expressions of ... congressional
intent.”). Instead, the aforementioned justifications war-
rant a statutory interpretation whereby the protections
provided by the statute are not limited by the canon of
construction in favor of the government.

B. The Canon Of Construction Whereby Stat-
utes Of Limitations Are To Be Strictly Con-
strued In Favor Of The Government, Is
Illogical And Should Not Be Applied Under
Any Circumstances.

“The doctrine of stare decisis is essential to the respect
accorded to the judgments of this Court and to the stabil-
ity of the law,” Lawrence v. Texas, 539 U.S. 558, 577 (2003)
(wherein the Court expressly overruled Bowers v. Hard-
wick, 478 U.S. 186 (1986)). However, that doctrine is “not
an inexorable command [)}.” Dickerson v. U.S., 530 U.S.

13

428, 443 (2000) (quoting State Oil Co. v. Khan, 522 US. 3,
20 (1997) (expressly overruling Albrecht v. Herald Co., 390
U.S. 145 (1968)); Agostini v. Felton, 521 U.S. 203, 235
(1997) (abandoning a strict application of stare decisis).
Instead, it is a mere “principle of policy.” Lawrence, 539
U.S. at 577. Therefore, “[iJn prior cases, when this Court
has confronted a wrongly decided, unworkable precedent
calling for some further action by the Court, {the Court
has] chosen not to compound the original error, but to
overrule the precedent.” Payne v. Tennessee, 501 U.S. 808
(1991) (Souter, J., concurring) (wherein the Court partially
overruled Booth v. Maryland, 482 U.S. 496 (1987) and
South Carolina v. Gathers, 490 U.S. 805 (1989)). The
canon of construction upon which the D.C. Circuit par-
tially relied, which provides that statutes of limitations
are to be strictly construed in favor of the sovereign, is
absurd and poorly reasoned and ought to be overruled.

Many statutes of limitations are imposed by the
legislature on individuals. See, e.g., 28 U.S.C. § 2244(d)(1)
(imposing a statute of limitations on the filing of a habeas
corpus petition). These statutes, which limit the rights of
action available to individuals, are not strictly construed
in favor of the individual, despite that the individuals had
no influence in the statutes’ enactment. Yet pursuant to
the canon of construction, statutes that limit the rights of
action available to the government are strictly construed
in favor of the government even though the limitation is

self-imposed.

This makes little sense. Because Congress has the
power to protect itself from the limitations imposed by a
statute of limitations, it can repeal an enacted statute of
limitations or reject it before it becomes law. In other
words, should Congress believe that a particular statute of

14

limitations overly restricts the rights of the government to
seek redress, Corigress may amend or repeal that statute.
Individuals, on the other hand, have no such power.
Therefore, the canon that provides for a strict construction
of statutes of limitations in favor of the government cannot
be justified.

A similar theory, known as “contra proferentem,” is
commonly applied in contract law, though it has been used
occasionally in statutory construction. See, e.g., German-
town Pass. Ry. Co. v. Citizens’ Pass. Ry. Co., 24 A. 1103,
1104, 151 Pa. 138, 140 (Pa. 1892); Larry A. DiMatteo,
Equity’s Modification of Contract: An Analysis of the
Twentieth Century’s Equitable Reformation of Contract
Law, 33 New Eng. L. Rev. 265, n.584 (Winter 1999) (“The
concept of strict construction against the drafter can be
found throughout Anglo-American Jurisprudence in both
statutory and non-statutory interpretations.”). The doc-
trine provides that “In interpreting documents, ambigui-
ties are to be construed unfavorably to the drafter,” Black’s
Law Dictionary 328 (7th ed. 1999); see also Restatement
(Second) of Contracts § 206 (1981), “because the drafter is
the party in a position to correct the ambiguity.” Gunn v.
Principal Cas. Ins. Co., 605 So.2d 741, 746 (Miss. 1992);
see also U.S. v. Seckinger, 397 U.S. 203, 216 (1970) (doc-
trine of contra proferentem is given “considerable empha-
sis” in construing a government contract “because of the
government’s vast economic resources and stronger bar-
gaining position.”). Following this same reasoning, an
ambiguous statute of limitations that restricts the right of
the government to seek redress should not be strictly
construed in favor of the government and, if anything,
should be strictly construed against the government.

15

Ultimately, such a canon of construction, which
creates preferential rules and presumptions, obfuscates
the statutory interpretation process. “It is hard enough to
provide a uniform, objective answer to the question
whether a statute, on balance, more reasonably means one
thing than another. But it is virtually impossible to expect
uniformity and objectivity when there is added, on one or
the other side of the balance, a thumb of indeterminate
weight.” Antonin Scalia, A Matter of Interpretation: Fed-
eral Courts and the Law 28 (Princeton University Press
1997). Given these considerations, this Court should reject
the canon of construction that mandates a strict construc-
tion of statutes of limitations in favor of the government,
and reverse the decision below.

¢

CONCLUSION

Agency orders, such as the MMS’s order to Petition-
ers, fall within the purview of 28 U.S.C. § 2415(a), when
textually construed, and therefore this Court should
reverse the holding of the D.C. Circuit Court. This “plain
meaning” interpretation is supported by this Court’s
doctrine that eschews absurd results. Here, the D.C.
Circuit Court’s conclusion that the text of § 2415(a) places
a time limitation only on judicial actions leads to an
absurd result whereby an administrative agency could
attempt to collect money though the administrative
process while being barred from judicial enforcement of
this administrative decision. Additionally, a reversal is
supported both by the purpose of § 2415(a) and by logic,
which mandates that this Court reject the canon of con-
struction, which construes statutes of limitation in favor of
the government, that underlies the erroneous decision of

16

the court below. Therefore, Mountain States Legal Foun-
dation respectfully requests that this Court reverse the
decision of the D.C. Circuit Court and hold that § 2415(a)
does apply to administrative orders.

Respectfully submitted:

WILLIAM PERRY PENDLEY*
*Counsel of Record
JOEL M. SPECTOR
MOUNTAIN STATES LEGAL FOUNDATION
2596 South Lewis Way
Lakewood, Colorado 80227
(303) 292-2021

Attorneys for Amicus Curiae
Dated June 13, 2006

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385016_0233%3A15. Public record. Not legal advice.