CHAPTER 16 ADJUDICATION OF INTERIOR DEPARTMENT DECISIONS
| Jurisdiction | United States |
(Jan 1990)
ADJUDICATION OF INTERIOR DEPARTMENT DECISIONS
Office of the Solicitor Department of the Interior
Denver, Colorado
THE INTERIOR DEPARTMENT APPEALS PROCESS, OR ON THE ROAD TO IBLA
As I began work on this speech, I decided to describe the two principal appeal routes within the Department of the Interior. I soon realized there were at least three appeal routes. Not long after that, I discovered a fourth and a fifth route. After that I quit counting.
The fact is the various appeals routes all begin at the same place. Every appeal starts with a decision that someone doesn't like — such as an order, or a notice of violation, or an assessment of civil penalties. Within the Department of the Interior, the appeals route ends at the same place, that is with a decision or order from the Interior Board of Land Appeals, usually known by its acronym as I-B-L-A or IBLA. While it's entirely possible to go on to judicial review in the Federal court system from an IBLA decision, as a practical matter, few people do.
Two factors determine which appeals route you're on. The first factor is which official in which agency made the decision. These agencies are the Bureau of Land Management (BLM) and the Minerals Management Service (MMS).1 Right away this narrows one's appeals options. A decision from a BLM district manager (DM) concerning units is certainly not going to be appealed to the Director of MMS.
The second important factor in determining which route to take is the subject matter of the order you want to appeal. For appeals from BLM decisions, there are three different subject areas. The first subject matter area leads to the simplest appeals route directly to the IBLA. This subject matter area covers the leasing stage — that is all the problems involved in the issuance of the lease, questions about the terms of the lease and rentals. This subject matter essentially includes everything having to do with the lease before beginning of on-the-ground operations. If, for example a lessee wants to have a provision deleted from an existing lease, the lessee would usually ask the appropriate BLM State Office to do so, supplying the reasons for the request. If the BLM office denied the request, the lessee would simply appeal directly to the IBLA. 43 C.F.R. 4.410.
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The second subject matter area is the operational phase. Suppose an operator or a lessee receives an unfavorable decision on drainage or suppose an application for permission to drill (APD) is turned down. The operator may then seek review from the State Director for that BLM State Office. 43 C.F.R. 3165.3(b) . At this State Director Review (SDR), the operator or lessee may present any kind of factual or legal argument. If the operator is unsuccessful, he or she may then take an appeal to the IBLA. 43 C.F.R. 4.410.
The third appeals track also arises from the operational phase. This track begins with a notice of noncompliance or notice of violation for which BLM proposes a civil penalty under the Federal Oil and Gas Royalty Management Act, 30 U.S.C. § 1701 et seq., better known as FOGRMA. After receipt of the proposed penalty, the operator may seek State Director Review, just as in the previous example. The difference between the previous track and this one is that if the operator is still unhappy with the State Director Review, he must then seek a hearing on the record before an Administrative Law Judge (ALJ). If unhappy with the ALJ's decision, the operator may then take an appeal to the IBLA.
The fourth and fifth appeals routes come about when one deals with MMS. Again, the difference between the two tracks is the subject matter. Typically, the fourth route deals with disputes over methods of calculating royalties or over such things as late payments. Generally, as long as no civil penalties or refusal to obey certain orders is involved, one may take an appeal to the Director of MMS. 30 C.F.R. 290.2. A party dissatisfied with the Director's decision may take an appeal to the IBLA. 30 C.F.R. 290.7.
The fifth appeals track involves violation of orders from MMS to pay royalties for which civil penalties may be assessed under the provisions of FOGRMA. An operator, lessee, or payor may contest the order before an ALJ and, if still dissatisfied, may take an appeal to the IBLA. 30 C.F.R. 241.51 ; 43 C.F.R. 4.410. As one can see, this last appeal route is similar to the third route through BLM State Director Review.
Now, let's review the different appeals routes before we get into the actual nuts and bolts or technical aspects of each route. First, one can tell which appeals route to take by looking first at the agency that issued the decision — BLM or MMS. The second important factor after looking at the agency which issued the decision is the subject matter area of the decision. If it's a leasing stage decision, one may appeal directly from BLM to the IBLA. If it's an operational stage decision, but does not deal with civil penalties, one appeals from the BLM decision to the
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State Director to the IBLA. In the case of civil penalties proposed by BLM, one takes an appeal to the State Director, then to an ALJ, and then to the IBLA. In the case of proposed penalties by MMS, one may take an appeal to an ALJ and from there to the IBLA.
We turn now to the actual "how-to-do-it" kind of details for each appeals route. When we do so, we automatically find it necessary to discuss some basic legal concepts. For example, the first requirement for taking any appeal is some kind of adverse decision. This requirement is set forth in 43 C.F.R. 4.410, which states that an appeal may be taken by one who is (a) a party to a case and (b) is adversely affected by the decision. Now, in determining whether one is adversely affected by a decision, we get into those cases dealing with issues such as standing and ripeness.
For the typical case involving an order or decision from BLM, it's easy to tell that you've received an adverse decision. Usually, a BLM decision meant to affect someone's rights will have the word DECISION or ORDER typed on it in bold face. Obviously, the contents of the letter will also spell out what action is being taken or denied. And, finally, the decision will have an appeals paragraph at the very end which tells you how and to whom to appeal. The very absence of these things will sometimes lead the IBLA to conclude that a letter is not an adverse decision.
For example, in a recent IBLA decision, Chevron U.S.A., Inc., 111 IBLA 96 (1989), the IBLA held that the absence of service on Chevron and the absence of an appeals paragraph meant that the decision was not adverse to Chevron. In that case, the unit operator asked BLM to approve expansion of a unit in Wyoming which would include two other existing units. Chevron objected on various grounds, including the argument that the formation supposedly underlying the new, expanded unit was actually three separate formations. The BLM eventually approved the unit operator's request for an expansion of the unit. The BLM sent its approval letter to the unit operator and instructed the operator to notify those affected. A month later, BLM sent Chevron an order to file its ratification and joinder of the new, expanded unit. Several weeks later, Chevron sought what was then called a technical and procedural review (TPA) and is now called a State Director Review (SDR). But the State Director refused to consider Chevron's arguments because Chevron had not sought review in a timely fashion from BLM's decision approving the expansion of the unit, even though Chevron didn't know about it until a month later when BLM ordered ratification and joinder of the new, expanded unit.
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On appeal, the IBLA held that the State Director was wrong in not considering Chevron's arguments at the State Director Review stage. First of all, even if the BLM had issued a decision to the unit operator, it was never intended to be a decision to Chevron. Second, there was no appeals paragraph in the letter to the unit operator which would indicate that it was an...
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