                             UNPUBLISHED

                  UNITED STATES COURT OF APPEALS
                      FOR THE FOURTH CIRCUIT


                             No. 08-1250


GEOFFREY J. GARCIA; CHARLOTTE M. GARCIA,

                Plaintiffs - Appellants,

           v.

UNITED STATES OF AMERICA; INTERIOR BOARD OF LAND APPEALS,

                Defendants - Appellees.


Appeal from the United States District Court for the Eastern
District of Virginia, at Alexandria.    Claude M. Hilton, Senior
District Judge. (1:06-cv-00915-CMH-TCB)


Argued:   October 28, 2009                 Decided:   January 20, 2010


Before MOTZ and GREGORY, Circuit Judges, and Benson E. LEGG,
United States District Judge for the District of Maryland,
sitting by designation.


Vacated and remanded by unpublished per curiam opinion.


ARGUED: Richard Merritt Stephens, GROEN, STEPHENS & KLINGE, LLP,
Bellevue, Washington, for Appellants.      Anna Katselas, UNITED
STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Appellees.
ON BRIEF: Ronald J. Tenpas, Assistant Attorney General, John L.
Smeltzer, John S. Most, UNITED STATES DEPARTMENT OF JUSTICE,
Environment & Natural Resources Division, Washington, D.C.;
Michael   A.   Schoessler,    Attorney-Adviser,   UNITED   STATES
DEPARTMENT OF THE INTERIOR, Washington, D.C., for Appellees.


Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:

        Today      marks     a    milestone     for    the     Fourth   Circuit     as   we

address,         for   the   first    time    in      recorded    history,    an   appeal

involving a gold mining claim under the Mining Act of 1872. 1

Geoffrey and Charlotte Garcia (“the Garcias”) appeal from an

order       of   the     United    States     District        Court   for   the    Eastern

District of Virginia granting summary judgment to the United

States and Interior Board of Land Appeals (“the Board”).                                 The

district         court     held    that   the       Board’s    decision     denying      the

viability of the Garcias’ claim on a plot of land in Oregon did

not violate the Administrative Procedure Act (“the APA”).                                For

the reasons that follow, we vacate and remand.



                                              I.

        The Mining Law of 1872 encourages mineral exploitation by

allowing prospectors who patent mining claims to take fee title

to the land on which the claim rests.                         To obtain a patent from

the Department of the Interior, the applicant must prove that he

or she has discovered a “valuable mineral deposit,” which means




        1
       When we inquired about venue at oral argument, the Garcias
informed us that they sued the Department of the Interior in its
home district to avoid unfavorable precedent in the Ninth
Circuit.   The Government, for reasons unknown, decided not to
challenge the Garcias’ choice of venue.


                                                2
a deposit that a prudent person would expend labor and means to

develop.

        The Garcias are gold miners who applied in 1985 to patent

the Last Chance Association Placer Mining Claim on a 24.23 acre

plot in Oregon, and thus take title of the land. 2                            In 1990 the

Bureau of Land Management (“BLM”) issued the Garcias a First

Half Final Certificate (“FHFC”) -- an official acknowledgement

that        the    necessary      paperwork     is    on    file   that    authorized   the

Garcias           to   go     forth   and   prove     that    they   had    discovered    a

valuable mineral deposit.

       During the process, a BLM mineral examiner evaluated the

Garcias’ claim and determined, based on soil samples and cost

estimates,             that    the    Garcias   had    not     discovered     a   valuable

mineral deposit.               Based on the examiner’s report, the BLM filed

a contest complaint in the Department of Interior’s Office of

Hearings and Appeals disputing the Garcias’ claim.

       This triggered a hearing before an Administrative Law Judge

(“ALJ”) in 1997, in which the Garcias appeared pro se.                            The ALJ

heard        testimony,         saw    evidence,      and    considered      post-hearing

briefs about the economics of the Last Chance mine.                               The ALJ

made findings regarding both the potential revenues from the


        2
       “Last Chance” is the name of the mine.  “Placer mining”
refers to a mining process that entails sifting through gravel
to find valuable minerals.


                                                3
mine, including the likely price of gold (estimated at $400/tr-

oz), and the cost of mining the claim.             Based on these findings,

the ALJ determined that the Garcias stood to profit from the

mine, and so granted their application.

       BLM appealed the ALJ’s order to the Board, which issued a

twenty-four page opinion reversing the ALJ.                   United States v.

Garcia, 161 IBLA 235 (2004).           The Board agreed with all of the

ALJ’s findings except with regard to the wash plant rate.                  Id.

at 241, 253-54.     The wash plant is a facility that uses water to

extract gold from gold-bearing gravel.                 The plant then expels

the water and non-gold sediment.            Rather than discharge effluent

into public waterways, the Garcias intended to recycle the water

through “settling ponds.”      Once water from the wash plant enters

a settling pond, the solids sink to the bottom, leaving the

water available to wash more gravel.

       The ALJ had found that the Garcias’ existing wash plant

facility could process minerals at a rate of 100 loose cubic

yards per hour (“lcy/hr”) -- which would use 90,000 gallons per

hour of water.     The Board found that this calculation failed to

take    into   account   the   small       size   of    the   settling   ponds.

Including that variable, the Board determined that the plant

could operate at a maximum rate of 25 lcy/hr -- using 22,500

gallons per hour.    161 IBLA at 254-55.



                                       4
       The Board then evaluated the operating costs of the mining

operation, including the wash plant, and determined that at the

lower rate of operation, the mine would generate a loss.                 Id. at

258.     Specifically, the Board considered the costs of mining

Area 1, the most easily mined (and hence the most likely to be

profitable) area of the claim, and concluded that mining Area 1

would return a $8700 loss.        Id.       Because a prudent person would

not mine at a loss, the Board held that the Garcias had failed

to prove that they had discovered a valuable mineral deposit,

and so voided their claim.       Id.

       The Garcias filed a petition for reconsideration with the

Board.    The Board reconsiders its rulings only in “extraordinary

circumstances.”       In their petition, the Garcias raised, for the

first time, several objections to the ALJ’s and the Board’s cost

estimates.        The Board addressed each of the Garcias’ arguments

and then denied their petition, concluding that “their reasons

stated in support of reconsideration are essentially an attempt

to relitigate issues considered and decided by [the ALJ] and

this     Board.      The   reasons     do    not     establish     extraordinary

circumstances to support reconsideration of our decision.”

       The Garcias then brought this action under the APA in the

United    States     District   Court       for    the   Eastern   District   of

Virginia.     On cross-motions for summary judgment, the district



                                        5
court held in the Board’s favor.               The Garcias timely noted this

appeal.



                                         II.

     The APA permits courts to review only those actions “made

reviewable by statute and final agency action for which there is

no other adequate remedy in a court.”                     5 U.S.C. § 704 (2006).

In this case, the final agency action is the Board’s decision.

43 C.F.R. §§ 4.21(d), 4.403 (2009).                  Reviewing courts consider

the “whole record” and set aside agency actions that are, inter

alia,     “arbitrary,     capricious,        an     abuse     of   discretion,      or

otherwise not in accordance with law;” “without observance of

procedure     required    by     law;”   or       “unsupported     by     substantial

evidence.”    5. U.S.C. § 706 (2006).

     “In    determining     whether      agency      action    was      arbitrary   or

capricious,       the    court    must       consider       whether      the    agency

considered the relevant factors and whether a clear error of

judgment was made.”            Ohio Valley Envtl. Coalition v. Aracoma

Coal Co., 556 F.3d 177, 192 (4th Cir. 2009).                       The standard of

review is “highly deferential, with a presumption in favor of

finding the agency action valid.”                   Id.      We will uphold the

agency action if “the agency has examined the relevant data” and

provided     an   explanation      of    its      decision     that      includes   “a

‘rational    connection     between      the      facts    found   and    the   choice

                                         6
made.’”    Id. (quoting Motor Vehicle Mfrs. Ass’n v. State Farm

Mutual Auto Ins. Co., 463 U.S. 29, 43 (1983)).

      “Substantial evidence is . . . such relevant evidence as a

reasonable      mind           might    accept         as        adequate     to    support       a

conclusion.”         Mastro v. Apfel, 270 F.3d 171, 176 (4th Cir. 2001)

(quoting Richardson v. Perales, 402 U.S. 389, 401 (1971)).                                      “It

consists of more than a mere scintilla of evidence but may be

somewhat   less       than       a     preponderance.”              Id.       In    substantial

evidence review, a reviewing court “should not undertake to re-

weigh conflicting evidence, make credibility determinations, or

substitute      its       judgment        for    that        of     the     [agency].”          Id.

(internal marks omitted).

      The Garcias raise several issues.                           For ease of exposition,

we address the issues in a slightly different order than the

Garcias presented them in their brief.



                                                III.

      The Garcias maintain that the Board’s procedures violate §

557 of the APA.           These arguments fail.

      The Garcias contend that the statute compels the ALJ to

give the Board a recommended decision and to allow the parties

an   opportunity          to    comment    on    that       decision.         But    a    careful

reading    of       the    APA    reveals       that        it    only    requires       ALJs    to

“recommend      a    decision”         when     the    agency        requires      “the    entire

                                                 7
record to be certified to it for decision.”               5 U.S.C. § 557(b)

(2006).   The Board, however, requires no such thing.                 Instead,

it   permits   ALJs   to   make   the       initial   decision   in   the   case

themselves.

      The Garcias also argue that the APA requires the ALJ and

the Board to allow them to comment on any proposed decision

before the decision becomes final, and the ALJ and the Board did

not allow them to do this.         See 5 U.S.C. § 557(c) (2006).             In

fact, the ALJ and the Board provided the Garcias with exactly

the procedure mandated by law.              First, the ALJ gave the parties

an opportunity to submit post-hearing briefs, including proposed

findings, to the ALJ.        43 C.F.R. § 4.452-8(a) (2009) (“At the

conclusion of the testimony the parties . . . shall be given a

reasonable time by the administrative law judge . . . to submit

. . . proposed findings of fact and conclusions of law and

reasons in support thereof.”).          Then, after the BLM appealed the

ALJ’s decision to the Board, the Garcias had ample opportunity

to comment on the entire record, including the ALJ’s decision. 3

      We thus hold that the Board’s procedures complied with the

requirements of § 557 of the APA.




      3
       The Garcias also imply that the Board was required to hold
additional hearings on appeal.    This position finds no support
in the APA or the related caselaw.


                                        8
                                             IV.

        The Garcias argue that the Board arbitrarily reversed the

ALJ’s    finding     regarding       the     wash     plant    rate.        The    Garcias

contend    that    the    ALJ    was    in    a     better    position      to    hear   the

evidence, that substantial evidence supported his decision, and

that the Board reversed the ALJ without reason.

        This   argument     misconceives           the   relationship       between      the

ALJ,    the    Board,    and    this       court.        Although,     as   a    practical

matter, the Board may have a disinclination to reverse an ALJ,

the Board reviews an ALJ’s decision de novo, with no obligation

to defer to an ALJ’s findings.                5 U.S.C. § 556(b) (2006), United

States v. Dunbar Stone Co., 56 IBLA 61, 67–68 (1981).                             Once the

Board completes its review, it speaks for the agency.                            43 C.F.R.

§§ 4.21(d), 4.403 (2009).              Our deferential standard then applies

to the Board’s decision, and not to the ALJ’s.                       Thus, the proper

question is not whether the Board arbitrarily reversed the ALJ,

or whether substantial evidence supported the ALJ’s decision,

but    rather     whether      the   Board’s        ultimate    conclusions        on    the

merits     are     arbitrary         and     capricious,        or     unsupported        by

substantial evidence.

        Applying that standard, we find no fault with the Board’s

conclusions regarding the wash plant rate.                       First, the Garcias

themselves used a processing rate of 25 lcy/hr in their patent

application.        Second, three separate witnesses testified that

                                              9
the settling ponds could not contain the discharge from a wash

plant running at 100 lcy/hr.              The evidence to the contrary shows

that the plant was capable of operating at a faster rate, but

does        not   address   the   settling   ponds,   and   therefore   does   not

address the crux of the Board’s decision. 4

        Considering the record as a whole, we find that substantial

evidence supported the Board’s findings relating to the wash

plant        rate,    and   that    its   decision    was   not   arbitrary     or

capricious.



                                          V.

        The Garcias continue to press the cost arguments that the

Board and the district court found untimely.                 Specifically, they

challenge the Board’s findings with regard to fuel and lubricant

costs, hours of operation for the wash plant, and permit costs.

        We agree with the Board that these arguments are untimely

and therefore waived.              “Simple fairness . . . requires as a

general rule that courts should not topple over administrative

decisions unless the administrative body not only has erred but

has erred against objection made at the time appropriate under

        4
       The Garcias also argue that the Board did not explain why
it singled out the wash plant rate finding for reversal, and not
the other findings. However, the Board discussed at some length
all of the ALJ’s findings.   It singled out the wash plant rate
because that was the only finding “not supported by the record.”
161 IBLA at 241.


                                          10
its practice.”      United States v. L.A. Tucker Truck Lines, Inc.,

344 U.S. 33, 37 (1952); 1000 Friends of Maryland v. Browner, 265

F.3d 216, 227-28 (4th Cir. 2001).                 It would be odd indeed to

find an agency’s decision arbitrary and capricious because the

agency refused to consider an argument that nobody made.

      The    Garcias     argue   that    submitting       an   argument     with    a

petition for reconsideration renders it timely.                    This argument

fails.       The   Board’s   regulation       for    petitions     to    reconsider

states      that   the     “Board       may   reconsider       a    decision        in

extraordinary circumstances for sufficient reason.”                     43 C.F.R. §

4.403 (2009).      The accompanying release states:

      This provision reinforces the Board's expectation that
      parties will make complete submissions in a timely
      manner    during    the    appeal,     not     afterward    on
      reconsideration.       This     expectation     is   justified
      because    almost    all     those     who     petition    for
      reconsideration     have      already      had     two    full
      opportunities    to    present     their     cases    to   the
      Department: once before the initial decisionmaker and
      again before the Board.        In general, the Board does
      not give favorable consideration to a petition for
      reconsideration which merely restates arguments made
      previously or which contains new material with no
      explanation for the petitioner's failure to submit
      such material while the appeal was pending.            Because
      parties recognize their obligations in this regard,
      relatively few petitions for reconsideration are ever
      filed.   Even so, the Board rarely finds it necessary
      to grant them, and even more rarely reverses itself.

52   Fed.   Reg.   21307-01,     21307    (June     5,   1987).     Plainly,       the

“appropriate time under [the Board’s] practice” for the Garcias

to raise their cost arguments was in the appeal to the Board,


                                         11
and not in a petition for reconsideration.                    See L.A. Tucker

Truck Lines, 344 U.S. at 37.

       The Garcias contend that they had no reason to submit their

cost       arguments   on   appeal   because   they   were   content   with   the

ALJ’s decision below.           But the Board reviews the ALJ’s factual

findings de novo, and, therefore, the Garcias would have been

prudent to point out any errors that inflated the costs of their

mining operation.           Instead, it appears that they argued that it

is the Board that should defer to the ALJ, and they offered no

evidence or arguments about the specific errors that the ALJ

made in his initial cost assessments.                 It is unclear whether

this was inadvertent or part of a strategy to shore up the ALJ’s

credibility, but whatever the reason, we cannot consider the

Garcias’ cost arguments now. 5



                                        VI.

       Finally, the Garcias argue that the Board held them to an

incorrect legal standard by requiring them to demonstrate to a

certainty that their mine would yield an immediate profit.

       5
        The Garcias also contend that the Board arbitrarily
refused to grant their petition for reconsideration.        This
argument lacks merit.   The Garcias did not persuade the Board
that they had good reason for failing to make their cost
arguments on appeal, and the Board thus correctly explained that
the Garcias arguments for reconsideration did not amount to the
type of “extraordinary circumstances” that merit reconsideration
under its regulations.


                                        12
    The Supreme Court has held that the test for determining

whether a claimant has discovered a valuable mineral deposit is

whether “a person of ordinary prudence would be justified in the

further expenditure of his labor and means, with a reasonable

prospect of success, in developing a valuable mine.”                 United

States v. Coleman, 390 U.S. 599, 602 (1968) (quoting Castle v.

Womble, 19 L.D. 455, 457 (1894)).       In Coleman, the Supreme Court

supplemented   this   “prudent-person   test”   with    a   “marketability

test,” requiring applicants to show “that the mineral can be

extracted, removed and marketed at a profit.”          Id. at 600.

     The Court further stated that:

     While it is true that the marketability test is
     usually   the  critical   factor  in  cases  involving
     nonmetallic minerals of widespread occurrence, this is
     accounted for by the perfectly natural reason that
     precious metals which are in small supply and for
     which there is a great demand, sell at a price so high
     as to leave little room for doubt that they can be
     extracted and marketed at a profit.

Id. at 603.    Applying the Coleman Court’s dictum about precious

metals, both the Ninth Circuit and the Board have held that:

     Although the claimant of a mining claim located for a
     precious metal (gold) need not prove that the gold can
     presently be extracted, removed, and marketed at a
     profit, evidence of the costs and profits of mining
     the claim may be properly considered in determining
     whether a person of ordinary prudence would be
     justified in the further investment of his labor and
     capital.




                                  13
Moon Mining Co. v. Hecla Mining Co., 161 IBLA 334, 361 (2004)

(citing Lara v. Sec’y of the Interior, 820 F.2d 1535, 1541 (9th

Cir. 1987)).

     Citing    these    authorities,         the   Garcias     argue   that   the

marketability test does not apply to claims involving precious

metals.    We agree that, when precious metals are concerned, the

applicant does not have to demonstrate present marketability,

and that the correct legal standard for precious metal claims is

whether, considering the likely costs and revenues, a prudent

person would expend labor and capital to mine the claim.                      This

standard   permits     an   applicant    to   point   to     the   likely   future

price of a precious metal to demonstrate that a prudent person

would mine that metal even if market conditions at the moment

were not favorable.

     Because “an administrative order cannot be upheld unless

the grounds upon which the agency acted . . . were those upon

which its action can be sustained,” we must vacate the judgment

of the district court, affirming the decision of the Board.                    SEC

v. Chenery Corp., 318 U.S. 80, 95 (1943).              We remand the case to

the district court with instructions to remand to the Board to

consider the Garcias’ claim under the correct legal standard.




                                        14
                         VII.

The judgment of the district court is

                                        VACATED AND REMANDED.




                          15
