Case: 19-2143   Document: 36     Page: 1   Filed: 04/07/2020




        NOTE: This disposition is nonprecedential.


   United States Court of Appeals
       for the Federal Circuit
                 ______________________

       FRAZER/EXTON DEVELOPMENT, L.P.,
          WHITELAND HOLDINGS, L.P.,
               Plaintiffs-Appellants

                            v.

                   UNITED STATES,
                   Defendant-Appellee
                 ______________________

                       2019-2143
                 ______________________

    Appeal from the United States Court of Federal Claims
 in No. 1:18-cv-01081-MMS, Chief Judge Margaret M.
 Sweeney.
                 ______________________

                  Decided: April 7, 2020
                 ______________________

    MATTHEW MCDONALD, Steinmeyer Fiveash LLP, Talla-
 hassee, FL, for plaintiffs-appellants.

     DANIEL HALAINEN, Environment and Natural Re-
 sources Division, United States Department of Justice,
 Washington, DC, for defendant-appellee. Also represented
 by JEFFREY B. CLARK, ERIKA KRANZ, ERIC GRANT.
                 ______________________
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 2          FRAZER/EXTON DEVELOPMENT, L.P.    v. UNITED STATES



     Before MOORE, CLEVENGER, and CHEN, Circuit Judges.
 CLEVENGER, Circuit Judge.
     Whiteland Holdings, L.P. (“Whiteland”) and Fra-
 zer/Exton Development, L.P. (“Frazer/Exton”) (collectively
 “Appellants”) appeal from an order from the Court of Fed-
 eral Claims (“Claims Court”) granting the Government’s
 (“Appellee”) motion to dismiss Appellants’ physical takings
 claim for lack of subject-matter jurisdiction. Whiteland
 Holdings, L.P. v. United States, 141 Fed. Cl. 702 (2019), re-
 consideration denied, No. 18-1081L, 2019 WL 2158874
 (Fed. Cl. May 17, 2019). The issue on appeal is whether
 the Claims Court erred in its holding that Appellants’
 claim accrued in 2011 and that the six-year statute of lim-
 itations 1 had expired prior to Appellants filing their claim.
 For the reasons set forth below, we affirm.
                        BACKGROUND
                           I. Facts
     Foote Mineral Company (“Foote Mineral”) acquired the
 subject property (“Foot Mineral Superfund Site”) 2 in 1941.
 Whiteland Holdings, 141 Fed. Cl. at 705. The United
 States Government thereafter purchased the Foot Mineral



      1  Any claim against the United States filed in the
 Court of Federal Claims must be “filed within six years af-
 ter such claim first accrues.” 28 U.S.C. § 2501.
     2   The subject property is located at 15 South Bacton
 Hill Road in Frazer, Chester County, Pennsylvania, and is
 situated primarily in East Whiteland Township. On Octo-
 ber 14, 1992, the Environmental Protection Agency added
 the subject property to the General Superfund Section of
 the National Priorities List. National Priorities List for
 Uncontrolled Hazardous Waste Sites, 57 Fed. Reg. at
 47,183–84. The subject property then became known as
 the “Foote Mineral Superfund Site.”
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 FRAZER/EXTON DEVELOPMENT, L.P.   v. UNITED STATES         3



 Superfund Site in 1942 and engaged Foote Mineral to con-
 duct lithium chemical processing operations for the Gov-
 ernment during World War II. Id. The Government also
 utilized the Foot Mineral Superfund Site for the production
 of various lithium and munition products as well as the
 stockpiling and storage of exotic ores. Id. Foote Mineral
 reacquired the property in July 1946, after the conclusion
 of World War II. Id. The Government, however, continued
 to operate the site into the 1950s, engaging Foote Mineral
 to produce and manufacture lithium halides and lithium
 metal products, both in liquid and solid form, to ground a
 variety of minerals and alloys, to produce inorganic fluxes
 for the steel industry, and to store various exotic ores for
 ammunition production and other potential uses as part of
 the wartime effort. Id.
      Unsurprisingly, site operations “created large quanti-
 ties of hazardous substances.” United States v. Frazer Ex-
 ton Dev. LP, No. 07-2666, 2008 WL 2876570, at *1 (E.D. Pa.
 July 24, 2008). Those hazardous substances “were dis-
 posed of in limestone quarries” on the subject property, re-
 sulting in the contamination of “soil on the Site and the
 ground water beneath the Site,” and “causing a plume of
 contamination that extends approximately two miles east”
 of the subject property. Id.
     Foote Mineral ceased its disposal practices in or around
 1975 and “engaged in cleanup and monitoring efforts”
 throughout the 1970s and 1980s. Id. The United States
 Environmental Protection Agency (“EPA”) “became in-
 volved in remediation efforts in 1988.” Id. On June 29,
 1990, the EPA and Foote Mineral entered into a consent
 order that required Foote Mineral to “conduct a groundwa-
 ter survey, institute a five-year monitoring program of pri-
 vate drinking water supplies, and provide an alternative
 drinking water source to affected residents.” Id. Foote
 Mineral discontinued site operations in 1991. Id.
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 4          FRAZER/EXTON DEVELOPMENT, L.P.    v. UNITED STATES



     In September 1996, the EPA, pursuant to a second con-
 sent order, required Foote Mineral to “conduct a remedial
 investigation and feasibility study.” Id. On November 20,
 1998, however, Frazer/Exton acquired the Foote Mineral
 Superfund Site. Frazer/Exton did so with “full knowledge
 of the existing contamination of the Site.” Id. In its pur-
 chase agreement, Frazer/Exton agreed to assume liabili-
 ties, obligations, and/or responsibilities arising under any
 applicable environmental law for environmental conditions
 including, among others, those arising in connection with
 consent orders. In accordance therewith, Frazer/Exton
 completed a Remedial Investigation Report and a Feasibil-
 ity Study Report, pursuant to the 1996 consent order, in
 June 2001.
     On August 11, 2003, the EPA held a public hearing re-
 garding its proposed plan for the Foote Mineral Superfund
 Site. Frazer/Exton’s president was at that public hearing,
 acknowledged that Frazer/Exton owned the site, and
 stated that (1) Frazer/Exton was “wholly supportive of the
 [EPA’s] proposed remedy and the proposed plan” and (2)
 the company “look[ed] forward to an expeditious negotia-
 tion of the implementation of the remedy with the EPA.”
 Whiteland Holdings, 141 Fed. Cl. at 707 (citations omit-
 ted).
     The EPA issued a Record of Decision—selecting a per-
 manent remedy for the Foote Mineral Superfund Site—on
 March 31, 2006, and notified Foote Mineral and Frazer/Ex-
 ton “of their potential liability to remedy the site” pursuant
 to the Comprehensive Environmental Response, Compen-
 sation, and Liability Act of 1980 (“CERCLA”). Frazer Ex-
 ton, 2008 WL 2876570, at *1. Frazer/Exton “volunteered
 to perform the work required by the [Record of Decision]”
 on July 21, 2006. Id. Frazer/Exton and the EPA then en-
 tered into a proposed consent order “for the purpose of com-
 mencing the design phase of the remedial action
 contemplated by the [Record of Decision]” that provided for
 Frazer/Exton to “pay for and perform the remedial action
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 FRAZER/EXTON DEVELOPMENT, L.P.   v. UNITED STATES         5



 that was selected by the EPA in the [Record of Decision].”
 Id. at *1–2.
     While conducting the remediation work, Frazer/Exton
 “learned that the volume of contaminated soil [was] larger
 than was estimated in the [Record of Decision].” Id. at *2.
 On April 7, 2008—after a thirty-day public comment period
 and an EPA public availability session regarding the addi-
 tional contamination—the EPA signed an Explanation of
 Significant Differences which amended the Record of Deci-
 sion by expanding the area to be capped, revising clean-up
 standards for certain contaminants, and allowing the use
 of permeability barriers in certain circumstances. Id. On
 July 24, 2008, the United States District Court for the
 Eastern District of Pennsylvania approved and entered the
 consent order, finding that it was “procedurally and sub-
 stantively fair” and “reasonable and consistent with
 CERCLA’s goal of ensur[ing] the cleanup of the nation’s
 hazardous waste sites.” Id. (internal quotation marks
 omitted).
     On October 28, 2010, the EPA issued a Superfund Pre-
 liminary Close Out Report pertaining to the Foote Mineral
 Superfund Site. According to Frazer/Exton, it “completed
 the investigation, removal, and/or remediation of the Site
 in 2011.” Whiteland Holdings, 141 Fed. Cl. at 708 (cita-
 tions omitted). Whiteland acquired the subject property
 via sheriff’s sale on November 17, 2016. On September 11,
 2017, pursuant to Pennsylvania law, Whiteland executed
 an environmental covenant (the “Pennsylvania Environ-
 mental Covenant” or “PEC”) in favor of Frazer/Exton,
 which effectuated the land use restrictions that were pre-
 sent in the July 25, 2008 consent order. The EPA approved
 the PEC nine days later.
                   II. Procedural History
     Frazer/Exton filed suit before the Claims Court on July
 24, 2018, and amended its complaint on August 24, 2018,
 repeating the same allegations but adding Whiteland as an
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 6          FRAZER/EXTON DEVELOPMENT, L.P.   v. UNITED STATES



 additional plaintiff. Appellants alleged that the Govern-
 ment’s operations and disposal methods at the Foote Min-
 eral Superfund Site resulted in environmental
 contamination, effecting a physical taking without just
 compensation in contravention of the Fifth Amendment to
 the United States Constitution.
     Appellee subsequently moved to dismiss the amended
 complaint, alleging that Appellants’ “takings claim accrued
 far more than six years before Frazer/Exton filed suit,” that
 “Frazer/Exton has waived” any Takings Clause claim
 against the federal government with respect to the Foote
 Mineral Superfund Site, and that both Frazer/Exton and
 Whiteland lack standing because “neither Frazer/Exton
 nor Whiteland held any sort of property interest in the
 Foote Mineral Superfund Site at the time of the [alleged]
 taking.” Whiteland Holdings, 141 Fed. Cl. at 709 (citations
 omitted).
      The Claims Court took notice of certain public docu-
 ments and concluded that Appellants’ takings claim ac-
 crued no later than 2011—when Appellants represented
 that they had completed the remediation—which was more
 than six years before filing suit, and dismissed the
 amended complaint for lack of jurisdiction under § 2501.
 Id. at 712–13. Appellants filed a motion for reconsideration
 on March 8, 2019, which the Claims Court denied on May
 17, 2019. Whiteland Holdings, L.P. v. United States, No.
 18-1081L, 2019 WL 2158874 (Fed. Cl. May 17, 2019). Ap-
 pellants timely appealed on July 12, 2019. This Court has
 appellate jurisdiction pursuant to 28 U.S.C. § 1295(a)(3).
                    STANDARD OF REVIEW
     We review the Claims Court’s legal conclusion that it
 lacked subject matter jurisdiction de novo. Stephens v.
 United States, 884 F.3d 1151, 1155 (Fed. Cir. 2018). “In
 deciding a motion to dismiss for lack of subject matter ju-
 risdiction, the court accepts as true all uncontroverted fac-
 tual allegations in the complaint, and construes them in
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 FRAZER/EXTON DEVELOPMENT, L.P.   v. UNITED STATES           7



 the light most favorable to the plaintiff.” Id. (quoting Estes
 Exp. Lines v. United States, 739 F.3d 689, 692 (Fed. Cir.
 2014)). We review the Claims Court’s determinations of ju-
 risdictional facts for clear error. Id.
                         DISCUSSION
     The Supreme Court has recognized two kinds of tak-
 ings: regulatory takings and physical takings. See Washoe
 Cty., Nev. v. United States, 319 F.3d 1320, 1326 (Fed. Cir.
 2003) (citing Lucas v. S.C. Coastal Council, 505 U.S. 1003,
 1014–15 (1992)). Although the Supreme Court has de-
 clined to set out a precise formula for determining whether
 a regulatory taking has occurred, these types of takings
 generally involve the regulation of private property. 3 Id.
 A physical taking, on the other hand, generally occurs
 when the government directly appropriates private prop-
 erty or engages in the functional equivalent of a “‘practical
 ouster of [the owner’s] possession.’” Id. (citation omitted).
     Although Appellants’ arguments on appeal focus
 largely on the EPA’s regulatory land-use restrictions at the
 Foote Mineral Superfund Site, which are set forth in the
 PEC, the claim alleged in the amended complaint below,
 and in Appellants’ preliminary statement on appeal, is for
 a physical, not a regulatory, taking. See S.A. 4; see also
 Appellants’ Brief at 1–2 (“This is a Fifth Amendment tak-
 ings case seeking damages for the United States’ physical
 taking of Plaintiffs’ property without just compensation.”).
 Specifically, Appellants argue that the deposition of large
 amounts of hazardous substances at the Foote Mineral Su-
 perfund Site resulted in a “gradual [physical] taking by the
 United States.” Id. at 2. Accordingly, the question for this



     3   In Lucas and the other “regulatory takings” cases,
 property owners claimed that government regulation of
 their private property has gone “too far.” Washoe Cty., 319
 F.3d at 1327.
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 8         FRAZER/EXTON DEVELOPMENT, L.P.   v. UNITED STATES



 court is not at what point did the EPA’s land-use re-
 strictions allegedly result in a regulatory taking of Appel-
 lants’ property, but at what point did Appellants’ physical
 takings claim accrue?
     Where a taking is caused by a gradual physical process,
 accrual of the claim may be delayed until the situation has
 “stabilized” such that the “consequences of the inundation
 have so manifested themselves that a final account may be
 struck.” United States v. Dickinson, 331 U.S. 745, 749
 (1947); see also Banks v. United States, 314 F.3d 1304, 1308
 (Fed. Cir. 2003). A final account may be struck “when it
 becomes clear that the gradual [physical] process set into
 motion by the government has effected a permanent tak-
 ing.” Boling v. United States, 220 F.3d 1365, 1370–71 (Fed.
 Cir. 2000). As explained in Boling, the “touchstone for any
 stabilization analysis is determining when the environ-
 mental damage has made such substantial inroads into the
 property that the permanent nature of the taking is evi-
 dent and the extent of the damage is foreseeable.” Id. at
 1373. Thus, the obligation to sue arises once the perma-
 nent nature of the government action is evident, regardless
 of whether damages are complete and fully calculable. See
 Mildenberger v. United States, 643 F.3d 938, 946 (Fed. Cir.
 2011) (citing Goodrich v. United States, 434 F.3d 1329,
 1336 (Fed. Cir. 2006)).
     “[J]ustifiable uncertainty about the permanency of the
 taking,” however, prevents accrual of a physical takings
 claim. Boling, 220 F.3d at 1372. Here, Appellants argue
 that Appellee’s alleged taking by a gradual physical pro-
 cess did not stabilize until the disposal of hazardous waste
 resulted in land-use restrictions. According to Appellants,
 “[u]ntil the EPA assessed the remediation and determined
 the nature and extent of land use restrictions, there was no
 predictability or permanence as to the extent to which [Ap-
 pellants’] property rights would be restricted,” Appellants’
 Brief at 22, and thus they remained justifiably uncertain
 about the permanency of the taking. Those land use
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 FRAZER/EXTON DEVELOPMENT, L.P.    v. UNITED STATES           9



 restrictions are a result of government regulation, how-
 ever, and do not constitute a physical taking. 4 None of Ap-
 pellants’ cited cases support expanding the stabilization
 doctrine to cases where justifiable uncertainty extends be-
 yond stabilization of the gradual physical taking, and up
 until the Government takes regulatory action. 5 The court
 declines this opportunity to so extend.



     4    While the land use restrictions effectuated in the
 PEC may or may not amount to a regulatory taking, Appel-
 lants’ have only asserted a gradual physical takings claim
 against the Government. Accordingly, Appellants have
 waived any argument that the PEC’s restrictions consti-
 tute a regulatory taking.
     5    These cases all concern ongoing physical processes
 where the permanency of the taking had not stabilized
 within six years of the lawsuit. See Dickinson, 331 U.S. at
 749 (holding claim for flooding did not accrue “as soon as”
 land was first subject to intermittent flooding in light of the
 “uncertainty of the damage” (i.e., taking)); Banks v. United
 States, 741 F.3d 1268, 1280–82 (Fed. Cir. 2014) (holding
 finding that “Appellants knew or should have known of the
 damage prior to 1952 is clearly erroneous” where “it was
 unreasonable to find that the Appellants were aware of
 their claim regarding the permanency before the 1990s Re-
 ports” showing that Corps’ “mitigation efforts could not re-
 verse the damage caused by its jetties”); Banks, 314 F.3d
 at 1309–10 (holding the Government’s promises to mitigate
 damages caused by a continuous physical process delayed
 accrual of a takings claim when the claimant demonstrated
 that the “‘predictability [and permanence] of the extent of
 damage to the [claimant’s] land’ was made justifiably un-
 certain by the Corps’ mitigation efforts.”) (citations omit-
 ted); Nw. La. Fish & Game Preserve Comm’n v. United
 States, 446 F.3d 1285, 1290–92 (Fed. Cir. 2006) (holding
 claim that weed overgrowth attributed to water
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 10         FRAZER/EXTON DEVELOPMENT, L.P.    v. UNITED STATES



      Here, it is undisputed that the Government’s and/or
 Foote Mineral’s deposition of large amounts of hazardous
 substances into the soils and groundwater at the Foote
 Mineral Superfund Site ceased decades before Appellants
 filed suit on July 24, 2018. It is also undisputed that Ap-
 pellants purchased the site with knowledge of the existing
 contamination. Thus, Appellants’ invocation of the stabili-
 zation doctrine is unavailing. Nevertheless, Appellants
 could still successfully invoke the accrual suspension rule
 if they demonstrate that either (1) the Government “con-
 cealed its acts” or (2) the injury (i.e., the taking) was “in-
 herently unknowable.” Young v. United States, 529 F.3d
 1380, 1384 (Fed. Cir. 2008) (internal quotation marks omit-
 ted). If, on the other hand, Appellants “knew or should
 have known that the claim existed,” accrual will not be sus-
 pended. Id. The “knew or should have known” test for
 claim accrual is “used interchangeably” with the “concealed
 or inherently unknowable” test, although the latter is “both
 more common and more precise.” Ingrum v. United States,
 560 F.3d 1311, 1315 n.1 (Fed. Cir. 2009).
     The Claims Court found Appellants’ argument that
 their “harm did not exist until the loss of use and property



 management did not accrue until Corps’ refusal to draw
 down water made clear that problem was permanent); Ap-
 plegate v. United States, 25 F.3d 1579, 1581–84 (Fed. Cir.
 1994) (holding Government’s promises to restore sand pre-
 vented stabilization of very gradual physical taking be-
 cause “the landowners did not know when or if their land
 would be permanently destroyed.”). In each case, the Court
 concluded that the claim accrued when the permanency of
 the gradual physical process stabilized and rendered dam-
 ages foreseeable. In no case, however, did the court hold
 that accrual is suspended even after the gradual physical
 process stabilized and the permanent nature of the govern-
 ment action was evident.
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 FRAZER/EXTON DEVELOPMENT, L.P.    v. UNITED STATES           11



 value could be determined as a result of the Environmental
 Covenant,” invokes the “inherently unknowable” prong of
 the accrual suspension rule. Whiteland Holdings, 141 Fed.
 Cl. at 711–12 (citation omitted). We agree. The “inherently
 unknowable” test involves a “reasonableness component.”
 Holmes v. United States, 657 F.3d 1303, 1320–21 (Fed. Cir.
 2011). Thus, this court must determine whether the
 Claims Court committed clear error in finding that Appel-
 lants’ alleged ignorance of their claim prior to September
 11, 2017 was unreasonable. Of particular note, the Claims
 Court found, while construing the complaint in the light
 most favorable to Appellants, that Frazer/Exton purchased
 the site with full knowledge of the existing contamination,
 see Whiteland Holdings, 141 Fed. Cl. at 706, that “Fra-
 zer/Exton was aware of the presence of bromate in the
 groundwater by 2003 at the latest, and the extended scope
 of the contamination prior to entry of the consent [order] in
 2008 . . . and most importantly . . . [that] Frazer/Exton itself
 has averred that it completed the required remediation in
 2011,” id. at 712. For these and the other reasons ade-
 quately described in the Claims Court’s Opinion and Order
 on Appellee’s motion to dismiss, and in its Opinion and Or-
 der on Appellants’ motion for reconsideration, the court
 holds that the Claims Court did not commit clear error in
 finding that Appellants knew or should have known of the
 permanency of the alleged physical taking, which began
 the accrual of their claim, by 2011.
                          CONCLUSION
      We hold that the Claims Court did not commit clear
 error in finding that Appellants knew or should have
 known of the scope and permanency of the alleged physical
 taking by at least 2011. Thus, the Claims Court did not err
 in finding that Appellants’ takings claim accrued more
 than six years prior to the date on which they filed suit.
 Accordingly, the order dismissing the amended complaint
 for lack of subject-matter jurisdiction is
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 12         FRAZER/EXTON DEVELOPMENT, L.P.      v. UNITED STATES



                         AFFIRMED
                            COSTS
      The parties shall bear their own costs.
