     In the United States Court of Federal Claims
                              No. 14-738L
                         (Filed: April 28, 2017)
                        NOT FOR PUBLICATION

**************************

3B’S LAND & GRAVEL,
                                              Res Judicata; Statute of
                    Plaintiff,                Limitations; Judicial Estoppel



v.

THE UNITED STATES,

                    Defendant.

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       William L. Ghiorso, Salem, OR, for plaintiff.

      Edward C. Thomas, Environment & Natural Resources Division,
Natural Resources Section, Department of Justice, Washington, DC, for
defendant, with whom was John C. Cruden, Assistant Attorney General. Hala
Teeny, Bonneville Power Administration, Office of General Counsel, of
counsel.
                           _______________

                                OPINION
                             _______________

BRUGGINK, Judge.

       Plaintiff, 3B’s Land & Gravel, LLC (“3B’s”) is a rock-quarrying
company operating in the state of Washington that, in December 2005,
purchased a 110-acre plot of land known as “Mt. Solo.” From 1942 to 1976,
the United States, through the Bonneville Power Administration (“BPA”),
acquired multiple easements to accommodate the passage of ten high-voltage
power lines across the property. Plaintiff filed its complaint on August 14,
2014, alleging that BPA effected a Fifth Amendment taking of its property due
to various actions that prevented 3B’s from making commercial use of its
property.

        Pending is defendant’s motion to dismiss pursuant to Rule 12(b)(6) of
the Rules of the United States Court of Federal Claims. Defendant argues that
BPA’s actions were taken in its proprietary capacity and thus could not give
rise to a compensable Fifth Amendment taking. It also argues that plaintiff’s
claims are barred by the doctrines of res judicata and judicial estoppel due to
3B’s involvement in prior litigation. Defendant also argues that some claims
are barred by the statute of limitations. The motion is fully briefed, and we
held oral argument on March 14, 2017. Because we find that plaintiff’s claims
are barred by the doctrine of res judicata, we grant defendant’s motion to
dismiss.

                               BACKGROUND

        An agency of the Department of Energy, BPA is a self-funded federal
power administration based in the pacific northwest. It markets federally-
generated power and operates a system of high-voltage electric transmission
lines across its territory. More than 40 years ago, BPA purchased a number of
easements for the purpose of accommodating ten high-voltage power lines and
the 17 towers needed to support them across what is now plaintiff’s property
on Mt. Solo. BPA’s easements cover 65 of the 110 acres on Mt. Solo—or,
roughly 60% of plaintiff’s property.

       Plaintiff purchased Mt. Solo, subject to the easements, in December of
2005. According to the easement summaries in plaintiff’s complaint, many
explicitly contemplated that the grantor would engage in mining activity.1 In
2006, roughly eight years before filing its complaint, plaintiff made substantial
investments and obtained all of the necessary permits in order to begin
commercial mining activity on Mt. Solo. One hour after breaking ground, the
Mine Safety and Health Administration (“MSHA”) issued a stop-work order
based on BPA’s concern about the impact on one of its high voltage towers.
17 days later, BPA completed improvements to its tower, and MHSA


1
 One easement, however, provides that “there shall be no blasting or removal
of rock from open quarry without the prior approval of the USA, which
approval shall not be unreasonably withheld.” Compl. ¶ 7.

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withdrew the stop-work order. Also in 2006, BPA installed locks on the gates
that provide access to Mt. Solo, leaving plaintiff, according to the complaint,
without access to the property for a period of time.


        In September of 2010, BPA recorded a notice of encroachment, alleging
that plaintiff changed the grade of its right of way and destabilized the footings
of some of BPA’s electrical towers, violating the terms of BPA’s easements.
The notice required that 3B’s “stop and desist [any activity within the
easements] until such time as [3B’s] submits a plan acceptable to BPA that
will restore the slope stability, access roads,” and follow certain conditions
outlined in the notice of encroachment. Def.’s Ex. 5.2 Plaintiff alleges that
BPA’s recording of a notice of encroachment brought it to financial ruin,
ultimately causing 3B’s to file a petition for chapter 11 bankruptcy in January
2012. In relevant part, plaintiff’s chapter 11 reorganization plan contemplated
mining on the Mt. Solo property and selling rock. In the bankruptcy
proceeding, BPA filed “[the] United States’ Response to Debtor’s Motions to
Lease Rock Quarry and to Sell Free and Clear,” specifically opposing “mining
and blasting activities at Mt. Solo that interfere, compromise or otherwise
impair BPA’s ability to reliably deliver power to its customers and provide
benefits to the region.” 3B’s Land & Gravel, LLC, No. 12-40392-PBS (W.D.
Wash. Bankr. June 15, 2012), ECF. No. 51; Def.’s Ex. 6. Plaintiff’s
bankruptcy plan was approved on March 25, 2013. See 3B’s Land & Gravel,
LLC, No. 12-40392-PBS (W.D. Wash. Bankr. Mar. 25, 2013) (Order
Confirming Plan), ECF No. 127.

       Plaintiff filed its complaint here on August 14, 2014. Plaintiff had
previously filed an action in September of 2012 that included nearly identical
claims in the District Court of Oregon, later transferred to the Western District


2
  We note that a copy of the notice of encroachment was not included with
plaintiff’s complaint. In deciding a motion to dismiss under RCFC 12(b)(6),
we generally only consider the allegations in the complaint, but “we may also
look to ‘matters incorporated by reference or integral to the claim . . . .’” A&D
Auto Sales, Inc. v. United States, 748 F.3d 1142, 1147 (Fed. Cir. 2014)
(quoting 5B Charles Alan Wright & Arthur R. Miller, Federal Practice and
Procedure § 1357 (3d ed. 2004)). Given that the notice of encroachment has
an integral role in plaintiff’s claim, we are satisfied that the copy of it, attached
to defendant’s motion to dismiss, is properly before us.

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of Washington, alleging that BPA’s actions effected a permanent and a
temporary taking of its property. It also asserted a quiet title petition. Notably,
these causes of action were not included in plaintiff’s bankruptcy schedules
until August of 2014, nearly a year and a half after the bankruptcy plan was
finalized.3 By that time, the Western District of Washington had dismissed
plaintiff’s action on the basis of judicial estoppel due to plaintiff’s failure to
include the contingent claims in its bankruptcy schedules. See 3B’s Land &
Gravel, LLC v. United States, No. 3:13-cv-06009 (W.D. Wash. June 4, 2014)
(Order Granting Def.’s Mot. to Dismiss), ECF No. 44; Def.’s Ex. 2.

                                 DISCUSSION

        The complaint here takes issue with three actions of BPA: 1) the
installation of locks in 2006; 2) the recording of a notice of encroachment in
September of 2010; and 3) BPA’s opposition to mining activities on Mt. Solo
during plaintiff’s bankruptcy proceeding. Plaintiff alleges that these actions
effected a Fifth Amendment taking of its property at Mt. Solo. In its motion to
dismiss, defendant makes four independent challenges to the viability of the
complaint. We deal primarily with its assertion of res judicata because
defendant is correct, and that defense makes dealing with the others in any
detail unnecessary.

        Under the doctrine of res judicata, a final judgment on the merits will
prevent the same parties from relitigating a claim that was raised in an earlier
proceeding. Plaintiff’s claims will be barred if we find that “(1) there is
identity of parties . . . ; (2) there has been an earlier final judgment on the
merits of a claim; and (3) the second claim is based on the same set of
transactional facts as the first.” Jet, Inc. v. Sewage Aeration Sys., 223 F.3d
1360, 1362 (Fed. Cir. 2000). Here, plaintiff only challenges whether there was
a final judgment on the merits in the district court proceeding. Plaintiff argues
that the district court never reached the merits of its takings claims and that the
district court did not have jurisdiction over its takings claim.



3
 Plaintiff amended its bankruptcy schedules on August 20, 2014, six days after
filing suit in this court, to include a claim against BPA for quiet title, slander
of title, declaratory relief, and inverse condemnation. See 3B’s Land & Gravel,
(W.D. Wash. Bankr. Aug. 20, 2014) (Notice of Am. Schedule), ECF No. 164;
Pl.’s Ex. 5.

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        We hold that the district court’s dismissal of 3B’s prior action
functioned as a final judgment on the merits and that plaintiff’s claims are thus
barred by operation of the principle of res judicata. Because both actions
involved the same parties and transactional facts, the first and third elements
listed above are easily met. In fact, much of plaintiff’s complaint in this court
is taken word-for-word from its earlier district court complaint. In the prior
action, indeed, plaintiff requested that the district court transfer its takings
claims to this court. Rather than transfer the claims, the district court
dismissed plaintiff’s complaint in its entirety on the basis of judicial estoppel,
not for lack of jurisdiction.4 3B’s Land & Gravel,(W.D. Wash. June 4, 2014);
Def.’s Ex. 2. Plaintiff’s prior complaint included all the claims it brings here.
Having received a final judgment against it on the merits, plaintiff cannot
bring those same claims here, in effect through a collateral attack on the
district court judgment. See generally Copelan v. Techtronics Indus. Co., Ltd.,
95 F.Supp.3d 1230, 1240 (S.D. Cal. 2015) (holding that the issue of judicial
estoppel should be considered under Rule 12(b)(6) because it is an affirmative
defense and not an issue of jurisdiction).

        In any event, even if plaintiff’s suit was not barred by res judicata, its
claims would either fall victim to this court’s six-year statute of limitations or
defendant’s other basis to dismiss under Rule 12(b)(6). The only physical
taking that plaintiff alleges involves the government’s placement of locks on
the gates at Mt. Solo. The government began this practice in 2006, roughly
eight years before plaintiff filed suit. Pl.’s Resp. Ex. 1 at ¶ 15. All claims
brought under the Tucker Act are subject to a six-year statute of limitations.
28 U.S.C. § 2501 (2012). To be successful, therefore, plaintiff must have filed
its claim within six years after it first accrued. As a general matter, a claim
accrues “when all the events have occurred that fix the alleged liability of the
government and entitle the claimant to institute an action.” Ingrum v. United
States, 560 F.3d 1311, 1314 (Fed. Cir. 2009) (citing Alliance of Descendants
of Tex. Land Grants v. United States, 37 F.3d 1478, 1481 (Fed. Cir. 1994)).
Here, plaintiff’s claim accrued when the government began putting locks on
the gate in 2006. As a result, plaintiff’s claim concerning a physical taking
falls outside this court’s six-year statute of limitations.



4
  We note that district courts have concurrent jurisdiction with this court for
takings claims up to $10,000. See 28 U.S.C. § 1346 (a)(2) (2012). In its
district court action, plaintiff did not allege the value of the taking.

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        The claims originating in the notice of encroachment and the opposition
to the plaintiff’s bankruptcy plan are also defective. We agree with the
government that BPA, as an adjoining landowner, was acting in its proprietary
capacity to protect its own property interests. The notice of encroachment
specifically states that “[a]ny activity within the Easements must stop and
desist.” Def.’s Ex. 5 (emphasis added). As to the bankruptcy opposition, that
cannot be deemed a taking because BPA was exercising its rights as an
interested party within its own proprietary concerns.5 Finally, a dispute
between two adjoining landowners as to their respective rights, when one of
the parties is the United States, is a quiet title proceeding, over which the
district courts have exclusive jurisdiction. See 28 U.S.C. § 1346(f). In sum,
even if res judicata were not a bar, the action would have to be dismissed
because there is no scenario in which plaintiff could be entitled to relief, or
because some of the claims are jurisdictionally defective.

                               CONCLUSION

      For the reasons stated above, we grant defendant’s motion to dismiss
under RCFC 12(b)(6). The clerk’s office is directed enter judgment
accordingly. No costs.




                                           s/Eric G. Bruggink
                                           ERIC G. BRUGGINK
                                           Senior Judge




5
  We note that neither the complaint nor any of plaintiff’s briefing materials
indicate what effect, if any, resulted from BPA’s filings in bankruptcy court.

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