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April 12, 1999


The opinion of the court was delivered by: Whitman Knapp, Senior District Judge.


Plaintiffs seek declaratory and injunctive relief in challenging the constitutionality of certain provisions of the Energy Policy Act of 1992 ("EPACT"), 42 U.S.C. § 2297g, et seq. Defendants have moved, pursuant to 28 U.S.C. § 1631, for an order transferring this action to the United States Court of Federal Claims ("CFC") for consolidation with plaintiffs' claims in that court, or, in the alternative, dismissing this action for lack of subject matter jurisdiction pursuant to Rule 12(b)(1) of the Federal Rules of Civil Procedure. As noted by defendants, upon the filing of a motion to transfer a case to the CFC, proceedings in the district court are statutorily stayed until sixty days after a decision on the motion. See 28 U.S.C. § 1292(d)(4)(B).


The factual background of this case is set forth in our Opinion and Order dated November 25, 1998, familiarity with which will be presumed. This action was commenced on June 12, 1998 and an amended complaint was filed on August 14. On August 17, the defendants moved, pursuant to Fed.R.Civ.P. 7(b)(1), for a stay pending the resolution of related actions commenced by each of the plaintiffs in the CFC. In an Opinion and Order of November 25, 1998, we denied that motion, but certified the question for interlocutory appeal. In denying the motion for a stay, we implicitly determined that we had subject matter jurisdiction, though we were not directly called upon to decide that issue.

Defendants contend that plaintiffs' claims are barred by the doctrine of sovereign immunity and that plaintiffs' sole remedy is in the CFC. Defendants maintain that none of the complaint's purported bases for district court jurisdiction, (1) federal question jurisdiction, 28 U.S.C. § 1331; (2) the mandamus statute, 28 U.S.C. § 1361; (3) the Declaratory Judgment Act, 28 U.S.C. § 2201-2202; and (4) the Administrative Procedure Act, 5 U.S.C. § 701 and 702, operate to waive the government's sovereign immunity. Plaintiffs respond by asserting that: (1) no waiver of sovereign immunity is required because district courts have subject matter jurisdiction to hear constitutional challenges to statutes; and (2) even if a waiver of sovereign immunity were required, § 702 of the Administrative Procedure Act provides for such a waiver in these circumstances. Thus, we now confront the jurisdictional question head-on.


In the motion at bar defendants have taken the position, as they did on their prior motion to stay, that 28 U.S.C. § 1491 ("the Tucker Act") mandates that plaintiffs' claims are properly considered only in the CFC and not in the district court. We must therefore examine whether plaintiffs' claims, which seek declaratory and injunctive relief, may be adjudicated in this forum.

A. Subject matter jurisdiction and sovereign immunity

The Second Circuit's decision in In re Chateaugay Corp. (2d Cir. 1995) 53 F.3d 478 convinces us that we retain subject matter jurisdiction over this action without regard to whether the government has waived sovereign immunity.

Chateaugay dealt with the question of who should pay the spiraling costs wrought by a series of benefits agreements over many years between coal mine owners and their employees. The burden of funding the pensions and benefits of an "ever-greater" number of retirees was falling upon an "ever-smaller" number of mining companies. Chateaugay, 53 F.3d at 484. Congress responded to the crisis by enacting the Coal Act, Pub.L. No. 102-486, 106 Stat. 2776, 3036-56 (codified at 26 U.S.C. § 9701-9722 ). The Coal Act spread the costs of funding the pensions between the mining companies then in existence and the companies which had already left the industry (by imposing the latter group's obligations on "related persons," typically successors in interest). To enforce compliance, the Coal Act authorized the Secretary of the Treasury to impose taxes on companies who failed to meet their obligations under the Act.

LTV Steel Company, the plaintiff in Chateaugay and a former coal mining outfit which had already filed for bankruptcy protection at the time of the Act's passage, challenged the constitutionality of the Coal Act on two grounds: (1) it claimed that the Act violated the Due Process Clause; and (2) that the Act constituted a taking of private property for public use without just compensation. The Chateaugay court affirmed the district court's dismissal of the due process claims after finding that the Coal Act, as an economic regulation, need only meet the rational basis level of scrutiny. 53 F.3d at 486-491.

Of greater interest for our purposes is the court's analysis of the takings claims. Citing the declaratory nature of the relief sought by LTV Steel, the court began its examination of the takings claims by expressly rejecting the government's theory that the district court was without jurisdiction to hear them. Id. at 491-92 ("We find no merit to the government's suggestion that the Tucker Act, 28 U.S.C. § 1491(a), acts to remove from the federal district courts jurisdiction over an action for declaratory relief where no money damages have been requested.").

The court then proceeded to address the thornier issue of whether a takings claim could ever be brought in a district court without first seeking compensation in the CFC. Id. at 492. After surveying a wide variety of Supreme Court decisions, the Chateaugay court noted a distinction between the Supreme Court's endorsement of district court jurisdiction over (1) statutes burdening real and tangible property; and (2) those requiring direct transfers of money ...

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