JAMES O. BROWNING, District Judge.
In deciding a motion for judgment on the pleadings that a plaintiff filed, the Court may consider only "`allegations of fact [that] are admitted or not controverted in the pleadings'" so that "`only questions of law remain to be decided by the district court.'" Kellar v. U.S. Dep't of Veteran's Affairs, No. CIV 08-0761 WYD/ KLM, 2009 WL 1706719, at *1 (D.Colo. June 17, 2009)(Daniel, C.J.)(quoting 5C Charles A. Wright & Arthur R. Miller, Federal Practice and Procedure: Civil § 1367 (3d ed.2004)). The Court will, thus, in connection with this motion for judgment on the pleadings, state and consider only those facts alleged in the Complaint for Declaratory and Injunctive Relief and Damages, filed January 10, 2014 (Doc. 1)("Complaint"), which the Defendants did not deny in the Answer to Complaint, filed March, 13, 2014 (Doc. 9)("Answer"). The Court's previous Memorandum Opinion and Order provides a fuller statement of the allegations in the Complaint, including allegations which the Defendants deny. See SWEPI, LP v. Mora Cnty., No. CIV 14-0035 JB/SCY, 2014 WL 6983288, at *1-11 (D.N.M. Dec. 5, 2014) (Browning, J.).
SWEPI, LP filed the Complaint, seeking an injunction to prohibit the Defendants from enforcing the Ordinance and seeking monetary damages. See Complaint ¶ 2, at 2; Answer ¶ 2, at 2. SWEPI, LP entered into an oil-and-gas lease with the State of New Mexico through a lease dated August 1, 2010. See Complaint ¶ 5, at 2; Answer ¶ 5, at 2 ("Defendants admit that a copy of a lease dated August 1, 2010 between the State of New Mexico and SWEPI is attached to the Complaint as exhibit 3."). See also Oil and Gas Lease between SWEPI LP and the State of New Mexico, dated August 1, 2010, filed January 1, 2014 (Doc. 1-3)("Aug. 1, 2010, Lease").
On April 29, 2013, the Mora County Board of County Commissioners voted two to one to adopt the "Mora County Community Water Rights and Local Self-Government Ordinance." Ordinance 2013-01 (the "Ordinance"). Complaint for Declaratory and Injunctive Relief and Damages ¶ 1, at 1, filed January 10, 2014 (Doc. 1)("Complaint"); id. ¶ 31, at 8. See Answer ¶ 1, at 1; id. ¶ 31, at 5.
Ordinance at 1-6 (alterations in original)(bold in original). See Answer ¶ 1, at 1 (admitted that the Ordinance is attached to the Complaint).
On January 10, 2014, SWEPI, LP filed suit against Mora County, the Mora County Commissioners, and the Individual Commissioners, bringing a number of federal and state claims. See Complaint at 1. SWEPI, LP seeks both injunctive and compensatory relief. See Complaint ¶¶ 142-52, at 27-28. Specifically, SWEPI, LP seeks a declaration that the Ordinance is unconstitutional and that it violates state law, and seeks an entry of judgment that permanently enjoins Mora County from enforcing the Ordinance. See Complaint ¶ 2, at 2. SWEPI, LP alleges nine claims of relief in the Complaint: (i) violation of the Supremacy Clause, U.S. Const. art. 6, cl. 2; (ii) violation of the Equal Protection Clause, U.S. Const. amend. XIV, § 1; (iii) violation of the Dormant Commerce Clause, U.S. Const. art. 1, § 8, cl. 3; (iv)
On May 13, 2014, SWEPI, LP filed the Motion, asking to Court to grant it judgment on its first, second, fourth, fifth, sixth, seventh, eighth, and ninth claims for relief. See Motion at 1. SWEPI, LP argues that the Court should declare the Ordinance unconstitutional, because it "legalizes invidious discrimination against corporations," and because it "purports to strip corporations of their rights" that the First, Fifth, and Fourteenth Amendments guarantee. Motion at 1. It asserts that the Ordinance, "[b]y its express terms, ... contravenes over two hundred years of Supreme Court precedent squarely establishing that corporations have protected constitutional rights," which "may not simply be cast aside out of animosity or disdain toward the corporate form." Motion at 1.
SWEPI, LP argues that the Ordinance violates the Supremacy Clause by stating that its provisions take precedence over conflicting or contrary federal law. See Motion at 2. SWEPI, LP contends that the Ordinance violates the Due Process Clause and the Equal Protection Clause by depriving SWEPI, LP of its property rights for an arbitrary reason: SWEPI, LP's status as an incorporated entity. See Motion at 2. SWEPI, LP argues that the Ordinance takes SWEPI, LP's property without just compensation by completely eliminating all economic value from its property in Mora County. See Motion at 2. SWEPI, LP also argues that the Ordinance eviscerates SWEPI, LP's constitutional rights under the First and Fifth Amendments. See Motion at 2. It maintains that the Ordinance is ultra vires and violates New Mexico state law by imposing local zoning regulations on New Mexico state lands. See Motion at 2. SWEPI, LP asserts that the Ordinance also violates state law by "dictating the use and effective abandonment of State oil and gas minerals that have been leased by the State to SWEPI." Motion at 2. Finally, SWEPI, LP argues that the Ordinance violates SWEPI, LP's property and contract rights that the New Mexico Constitution protects by depriving SWEPI, LP of its "right to explore for and extract hydrocarbons pursuant to its fee and State leases." Motion at 2.
SWEPI, LP first argues that the Ordinance violates the federal Constitution by invalidating protections that federal law affords in "a thinly veiled threat of secession from the United States." Motion at 3. SWEPI, LP asserts that a local law is invalid under the Supremacy Clause if the law "`conflicts with federal law or stands as an obstacle to the accomplishment of the full purposes and objectives of Congress.'" Motion at 3 (quoting Lawrence Cnty. v. Lead-Deadwood Sch. Dist., 469 U.S. 256, 260, 105 S.Ct. 695, 83 L.Ed.2d 635 (1985)). It argues that states lack the authority to nullify federal rights that they think are inconsistent with their local policies. See Motion at 3-4 (citing Haywood v. Drown, 556 U.S. 729, 736, 129 S.Ct. 2108, 173 L.Ed.2d 920 (2009)). SWEPI, LP contends that a party can bring a claim under the Supremacy Clause even if 42
SWEPI, LP also argues that the Ordinance violates the Equal Protection Clause. See Motion at 5. It contends that the Supreme Court of the United States of America has held that corporations are persons "within the meaning of the Equal Protection Clause and are entitled to its protections." Motion at 5 (citing Metropolitan Life Ins. Co. v. Ward, 470 U.S. 869, 881 n.9, 105 S.Ct. 1676, 84 L.Ed.2d 751 (1985); Covington & Lexington Turnpike Rd. Co. v. Sandford, 164 U.S. 578, 592, 17 S.Ct. 198, 41 L.Ed. 560 (1896)). SWEPI, LP maintains that the Equal Protection Clause's purpose is to protect "`every person within the State's jurisdiction against intentional and arbitrary discrimination,'" Motion at 6 (quoting Willowbrook v. Olech, 528 U.S. 562, 564, 120 S.Ct. 1073, 145 L.Ed.2d 1060 (2000)) (citing Rowland v. Mad River Local Sch. Dist., 470 U.S. 1009, 1014, 105 S.Ct. 1373, 84 L.Ed.2d 392 (1985)), and that the applicable test in this case is "whether `there is a rational relationship between the disparity of treatment and some legitimate governmental purpose,'" Motion at 6 (quoting Heller v. Doe, 509 U.S. 312, 320, 113 S.Ct. 2637, 125 L.Ed.2d 257 (1993)).
SWEPI, LP asserts that a state "`may not rely on a classification whose relationship to an asserted goal is so attenuated as to render the distinction arbitrary or irrational.'" Motion at 6 (quoting City of Cleburne v. Cleburne Living Ctr., 473 U.S. 432, 446, 105 S.Ct. 3249, 87 L.Ed.2d 313 (1985)) (citing Romer v. Evans, 517 U.S. 620, 633, 116 S.Ct. 1620, 134 L.Ed.2d 855 (1996)). SWEPI, LP argues that "a state law motivated by animus and directed at a politically unpopular group cannot survive even a rational relationship test." Motion at 6 (citing United States Dep't of Agric. v. Moreno, 413 U.S. 528, 534, 93 S.Ct. 2821, 37 L.Ed.2d 782 (1973)). It asserts that the Ordinance violates the Equal Protection Clause by "prohibiting corporations, but not individuals, from engaging in virtually any activity related to oil and gas exploration or production." Motion at 7. SWEPI, LP argues that that this distinction is invidious, bears no rational relationship to any legitimate state interest, and is motivated "by nothing more than a disdain for the corporate form." Motion at 7.
SWEPI, LP contends that the Supreme Court has held that disparate treatment between corporations and individuals bears no rational relationship to a legitimate state interest and, thus, violates the Equal Protection Clause. See Motion at 7. SWEPI, LP asserts that the Supreme Court, in Frost v. Corporation Commission of Oklahoma, 278 U.S. 515, 49 S.Ct. 235, 73 L.Ed. 483 (1929), held that a law cannot arbitrarily favor a corporation over an individual or an individual over a corporation. See Motion at 7-8. SWEPI, LP contends that the only context in which the
SWEPI, LP maintains that, if a state law is based on an invidious classification or is motivated by a desire to harm a politically unpopular group, the law violates the Equal Protection Clause. See Motion at 8. It contends that the Ordinance's disparate treatment between corporations and individuals is motivated "by a gross antipathy toward the corporate form," and that it is based on a discriminatory purpose against corporations. Motion at 8-9. SWEPI, LP argues that the Ordinance also discriminates against people associated with corporations by applying to directors, officers, owners, and managers of corporations. See Motion at 9. It argues that the Ordinance does not have a legitimate purpose, but that it is "a vindictive effort to disempower and punish corporations and anyone who is in any way affiliated with an incorporated entity." Motion at 9. SWEPI, LP maintains that the Ordinance's animus against the corporate form makes clear that it does not have, in violation of the Equal Protection Clause, a rational relationship to a legitimate governmental interest. See Motion at 10.
SWEPI, LP argues that, because it seeks to engage in activities which the Ordinance prohibits, the Ordinance purports to strip it of its First and Fourteenth Amendment rights. See Motion at 10-11 (citing Ordinance § 5.5, at 4 ("Corporations... seeking to engage in activities prohibited by this ordinance, shall not ... be afforded rights under the 1st or 5th amendments to the United States Constitution....")). SWEPI, LP contends that, by purporting to strip it of its fundamental rights, "the Ordinance is plainly unconstitutional." Motion at 11. It asserts that the Supreme Court has held that First Amendment protections extend to corporations. See Motion at 11 (citing Citizens United v. Fed. Election Comm'n, 558 U.S. 310, 342, 130 S.Ct. 876, 175 L.Ed.2d 753 (2010); Hobby Lobby Stores, Inc. v. Sebelius, 723 F.3d 1114, 1135 (10th Cir.2013), aff'd sub nom., Burwell v. Hobby Lobby Stores, Inc., ___ U.S. ___, 134 S.Ct. 2751, 189 L.Ed.2d 675 (2014)). SWEPI, LP argues that the Ordinance is analogous to the Los Angeles International Airport ("LAX") resolution that the Supreme Court invalidated in Board of Airport Commissioners v. Jews for Jesus, 482 U.S. 569, 107 S.Ct. 2568, 96 L.Ed.2d 500 (1987). See Motion at 11. It contends that the Board of Airport Commissioners for the City of Los Angeles, California, adopted a resolution banning all First Amendment activity in LAX's central terminal. See Motion at 11. SWEPI, LP argues that the Supreme Court found the resolution unconstitutional, because no conceivable governmental interest could justify an absolute ban on speech. See Motion at 11. It contends that the Ordinance is more egregious than the LAX resolution, which the Supreme Court invalidated, because the resolution applied only to the central LAX terminal, which could be a viewed as a non-public forum, while the Ordinance applies to all of Mora County, including places that are public forums, or that have traditionally been devoted to assembly and debate. See Motion at 11-12 (citing Perry Educ. Ass'n v. Perry Local Educators'
SWEPI, LP argues that the Ordinance effects a regulatory taking of property without just compensation. See Motion at 12. It contends that a regulatory taking can occur if "`government regulation of private property'" is " `so onerous that its effect is tantamount to a direct appropriation or ouster.'" Motion at 13 (quoting Lingle v. Chevron U.S.A. Inc., 544 U.S. 528, 537, 125 S.Ct. 2074, 161 L.Ed.2d 876 (2005)). SWEPI, LP argues that a plaintiff can prove a regulatory taking by showing that "a regulation `deprives land of all economically beneficial use.'" Motion at 13 (quoting Lucas v. S.C. Coastal Council, 505 U.S. 1003, 1027, 112 S.Ct. 2886, 120 L.Ed.2d 798 (1992)). It asserts that the Supreme Court's decision in Pennsylvania Coal Co. v. Mahon, 260 U.S. 393, 43 S.Ct. 158, 67 L.Ed. 322 (1922), conclusively demonstrates that the Ordinance constitutes a regulatory taking. See Motion at 13. There, SWEPI, LP contends, a mining company owned the mineral rights to a tract of land but not the surface rights. See Motion at 13 (citing Pennsylvania Coal Co. v. Mahon, 260 U.S. at 412, 43 S.Ct. 158). SWEPI, LP notes that the state passed a law prohibiting the mining of coal in a way that would cause the subsidence of structures used for human habitation. See Motion at 13-14 (citing Pennsylvania Coal Co. v. Mahon, 260 U.S. at 412-13, 43 S.Ct. 158). SWEPI, LP asserts that the Supreme Court held that the state law constituted a compensable taking, because it abolished a valuable estate in land, and because it made it commercially impracticable to mine coal, which had the same effect as appropriating or destroying the company's interest in the coal. See Motion at 14. Similarly, SWEPI, LP asserts that New Mexico law recognizes a mineral estate as an interest in real property that is separate and distinct from the surface estate. See Motion at 14 (citing Johnson v. Gray, 1966-NMSC-020, ¶ 5, 75 N.M. 726, 410 P.2d 948, 950). SWEPI, LP argues that the Ordinance is more egregious than the law in Pennsylvania Coal Co. v. Mahon, because the Ordinance bans all extraction of hydrocarbons in Mora County, when undertaken by a corporation, while the Pennsylvania law merely limited the scope of coal mining to protect surface structures. See Motion at 15. It contends that this blanket prohibition makes it commercially impracticable for it to obtain any economic benefit from its mineral rights. See Motion at 15 (citing Pennsylvania Coal Co. v. Mahon, 260 U.S. at 414, 43 S.Ct. 158 ("`For practical purposes, the right to coal consists of the right to mine it.'" (quoting Commonwealth ex rel. Keator v. Clearview Coal Co., 256 Pa. 328, 100 A. 820, 820 (1917)))).
SWEPI, LP contends that the Ordinance also violates its substantive due-process rights. See Motion at 15. It argues that substantive due process prohibits a state from depriving property for an arbitrary reason. See Motion at 15 (citing Cnty. of Sacramento v. Lewis, 523 U.S. 833, 846, 118 S.Ct. 1708, 140 L.Ed.2d 1043 (1998); Hyde Park Co. v. Santa Fe City Council, 226 F.3d 1207, 1210 (10th Cir. 2000)). SWEPI, LP asserts that its oil-and-gas
SWEPI, LP argues that the Ordinance violates state law by enacting zoning regulations over state land. See Motion at 18. It contends that state statutes created Mora County and that Mora County possesses only those "powers expressly granted to it by the Legislature together with those necessarily implied to implement express powers." Motion at 18 (citing Board of Cnty. Comm'rs v. Greacen, 2000-NMSC-016, ¶¶ 7-8, 129 N.M. 177, 3 P.3d 672, 675-76). SWEPI, LP argues that, while the New Mexico Legislature has granted counties the authority to pass some zoning ordinances, the New Mexico courts have held that a county cannot enforce its ordinances on lands that the State of New Mexico owns. See Motion at 18-19 (citing Cnty. of Santa Fe v. Milagro Wireless, LLC, 2001-NMCA-070, ¶ 7, 130 N.M. 771, 32 P.3d 214, 216). It asserts that, because the Ordinance prohibits all drilling in Mora County—without making an exception for state land—the Ordinance is ultra vires and invalid. See Motion at 19. SWEPI, LP further argues that, even if the Ordinance did not apply to state lands, because the Ordinance prohibits any activity related to the production of hydrocarbons, the Ordinance would still have the effect of prohibiting the extraction of hydrocarbons on state lands, because SWEPI, LP would need to establish and maintain the necessary infrastructure within Mora County to extract hydrocarbons on state land. See Motion at 19-20.
SWEPI, LP argues that, because the Ordinance undermines state law and the State's interests, it is unenforceable. See Motion at 20 (citing Chapman v. Luna, 1984-NMSC-029, 101 N.M. 59, 678 P.2d 687). It contends that, because of the New Mexico Oil and Gas Act, N.M. Stat. Ann. § 70-2-1 to -38, the Attorney General of New Mexico has opined that counties cannot regulate oil-and-gas activities. See Motion at 20 (citing N.M. Att'y Gen. Op. 86-2, 1986 WL 220334 (1986)). There, SWEPI, LP argues, the New Mexico Attorney General, Paul Bardacke, concluded that the New Mexico Oil Conservation Division occupies the entire field of oil-and-gas regulation, preempting any county ordinances that regulates or affects oil-and-gas
Finally, SWEPI, LP argues that the Court must declare the Ordinance, in its entirety, invalid and that no part of the Ordinance is severable from the rest. See Motion at 21. It contends that a law, in which some portions are invalidated, can have its valid portions severed from the invalid ones, when the legislative purpose of the valid portions can be given effect through the remaining portions and where it cannot be shown that the legislature would not have passed the valid portions if it had known that the other portions would be invalidated. See Motion at 22 (citing Bradbury & Stamm Constr. Co. v. Bureau of Revenue, 1962-NMSC-078, ¶ 7, 70 N.M. 226, 372 P.2d 808, 811). SWEPI, LP asserts that the Ordinance's purpose is to divest corporations of their rights and privileges by prohibiting corporations from engaging in activities that the Ordinance prohibits. See Motion at 22. It argues that, once the Court invalidates this prohibition, the Ordinance's purpose cannot be given effect. See Motion at 22. SWEPI, LP maintains that the Ordinance's severability clause does not automatically make the Ordinance severable, because the clause merely provides a rule of construction, which can be considered, but is not binding. See Motion at 22 (citing Bradbury & Stamm Const. Co. v. Bureau of Revenue, 1962-NMSC-078, ¶ 9, 70 N.M. 226, 372 P.2d 808). It further argues that the fact that the Ordinance suggests that Mora County would refuse to recognize the legitimacy of a court order invalidating the Ordinance undercuts the severability clause's effect. See Motion at 23.
The Defendants responded to the Motion on June 12, 2014. See Defendants' Answer to Plaintiff's Motion for Partial Judgment on the Pleadings, filed June 12, 2014 (Doc. 33)("Response"). They argue that SWEPI, LP's legal theories are flawed, that it has not shown that Mora County lacked a rational basis for passing the Ordinance, and that they have established factual issues that require discovery. See Response at 1-2. The Defendants provide a summary of how the Ordinance came into being. See Response at 2-3. They assert that, in 2011, Mora County residents began to discuss ways to protect the environment and water from oil-and-gas extraction activities, including hydraulic fracturing
The Defendants argue that they have raised a number of affirmative defenses in the Answer, which, if proven, would defeat SWEPI, LP's claims. See Response at 3. Specifically, they contend that SWEPI, LP lacks standing and that the case is not ripe for adjudication. See Response at 3. The Defendants also contend that they have asserted a number of factual disputes in the Answer, including that SWEPI, LP does not possess valid leases that authorize it to extract hydrocarbons from Mora County, that SWEPI, LP does not intend to engage in activities related to the extraction of hydrocarbons in Mora County, that Mora County had a rational basis to enact the Ordinance, and that the Ordinance is necessary to protect Mora County residents' air, water, land, health, welfare, and safety. See Response at 3. They argue that, because they have asserted affirmative defenses and because they have asserted factual disputes in the Answer, the Court should deny the Motion. See Response at 3-4.
The Defendants argue that, because the Court must accept all facts that the non-moving party pled and grant all inferences in the Defendants' favor, the Court must presume that SWEPI, LP does not have standing, that the case is not ripe, and that the affirmative defenses asserted in the Answer are viable. See Response at 5 (citing Park Univ. Enter., Inc. v. Am. Cas. Co. of Reading, Pa., 442 F.3d 1239 (10th Cir.2006), abrogation recognized in Magnus, Inc. v. Diamond State Ins. Co., 545 Fed.Appx. 750 (10th Cir.2013) (unpublished); Gen. Conference Corp. of Seventh-Day Adventists v. Seventh-Day Adventist Congregational Church, 887 F.2d 228, 230 (9th Cir.1989)). They contend that the Court must determine issues of standing before considering the case's merits. See Response at 6 (citing Morgan v. McCotter, 365 F.3d 882, 887 (10th Cir.2004)). To establish standing, the Defendants assert, a plaintiff must suffer a present or imminent injury, rather than a possible or probable future injury. See Response at 7. They argue that SWEPI, LP cannot rely on general allegations of an injury at a dispositive stage of a case, but must instead provide evidence to demonstrate standing. See Response at 7 (citing Lujan v. Defenders of Wildlife, 504 U.S. 555, 561, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992)).
The Defendants argue that SWEPI, LP must allege that it has valuable property to prove a loss, but that SWEPI, LP has not alleged that its leases have value. See Response at 7. They also contend that they have denied SWEPI, LP's allegations that it is the holder of a valid oil-and-gas lease, and that it is seeking to or is prepared to engage in activities that the Ordinance prohibits. See Response at 7 (citing Answer ¶¶ 4-7, at 2). The Defendants assert that there is a genuine issue of fact whether SWEPI, LP has suffered an injury, and thus has standing, because the Defendants have disputed many of SWEPI, LP's factual allegations that are necessary to establish standing. See Response at 8. They argue that SWEPI, LP's sole allegation concerning its property interests in Mora County is that it owns oil-and-gas leases. See Response at 8 (citing Complaint ¶¶ 4-7, at 2-3). They assert that they do not admit:
Response at 8 (citing Answer ¶¶ 4-7, at 2). The Defendants contend that the Court cannot assume that the leases provide SWEPI, LP with any rights, because that assumption would resolve an issue in the moving party's favor, which is contrary to the judgment on the pleadings standard. See Response at 8-9. They argue that, while an allegation that a plaintiff has a property interest may satisfy the pleading standard, it is insufficient to meet the standard for judgment on the pleadings, and that the Defendants' denial of SWEPI, LP's "factual allegations is sufficient to establish numerous issues of material fact as to whether Plaintiff has standing and to justify denial of Plaintiff's Motion." Response at 9.
The Defendants argue that SWEPI, LP's corporate status is insufficient to establish standing. See Response at 9. They contend that SWEPI, LP must have more than "a generalized grievance" and that it cannot rely solely on allegations that the Ordinance discriminates against corporations to establish standing. Response at 9 (citing Harris v. McRae, 448 U.S. 297, 320, 100 S.Ct. 2671, 65 L.Ed.2d 784 (1980)). The Defendants maintain that SWEPI, LP must assert a concrete and particularized harm that the Ordinance causes. See Response at 9. The Defendants argue that SWEPI, LP's allegations that it possesses oil-and-gas leases, and that it would seek to extract hydrocarbons if it were not for the Ordinance, are SWEPI, LP's attempt to create this concrete and particularized harm, but that the Defendants have denied those allegations. See Response at 9-10 (citing Answer ¶¶ 4-7, at 2). They contend that, because they denied those allegations, the Court cannot consider the allegations as true and the pleadings do not conclusively establish standing. See Response at 10.
The Defendants assert that SWEPI, LP's standing is speculative, because it initiated the lawsuit before any enforcement had occurred under the Ordinance. See Response at 10. They argue that SWEPI, LP alleges only that it desires to engage in activities that the Ordinance prohibits. See Response at 10. They contend that SWEPI, LP's position in this case is comparable to that of the plaintiff in Kegler v. United States Department of Justice, 436 F.Supp.2d 1204 (D.Wyo.2006) (Johnson, J.). See Response at 10. The Defendants argue that, there, the plaintiff challenged the Gun Control Act of 1968, 18 U.S.C. §§ 921 to 930 ("GCA"), because the GCA prohibited persons convicted of a domestic violence misdemeanor from possessing a firearm. Response at 10. They contend that the Honorable Alan B. Johnson, United States District Judge for the District of Wyoming, found that, without any threat of investigation, arrest, or prosecution, the GCA, by itself, was insufficient for the plaintiff to establish standing. See Response at 10. The Defendants assert that SWEPI, LP had not made definite plans to engage in hydrocarbon extraction or exploration, and there is no threat or history of investigation or prosecution. See Response at 10. They argue that SWEPI, LP's fears are based on the content of the Ordinance rather than an injury in fact. See Response at 10-11.
The Defendants contend that there are genuine issues of material fact as whether
The Defendants argue that SWEPI, LP's leases, without other permits or authority from the State, do not provide SWEPI, LP with a legal basis to explore and produce hydrocarbons in Mora County. See Response at 13. They contend that SWEPI, LP has not alleged that it applied for a drilling permit, or sought permission for the disposition of toxic wastewater that could result from oil-and-gas extraction activities. See Response at 13. The Defendants argue that SWEPI, LP's position is similar to the position of the plaintiffs in Lujan v. Defenders of Wildlife, where the Supreme Court held that there was no case or controversy based on the plaintiffs' intent to travel to a certain area at some point in the future without any definitive plans to do so. See Response at 13 (citing Lujan v. Defenders of Wildlife, 504 U.S. at 583-84, 112 S.Ct. 2130 (Stevens, J., concurring)). They further argue that SWEPI, LP has not demonstrated that it has legal access to water, which is necessary for fracking, because neither of its leases provides it with water rights. See Response at 13. The Defendants contend that SWEPI, LP has failed to show that it has legally accessible water or that it can purchase water from existing users to be used for fracking. See Response at 13-14 (citing N.M. Stat. Ann. § 72-12-7). They argue that, because SWEPI, LP does not allege that it has available water, the Court must assume that SWEPI, LP has no water and that SWEPI, LP lacks the necessary resources to extract hydrocarbons through fracking. See Response at 14. The Defendants assert that SWEPI, LP's plans to act on its leases are based solely on contingent events that may not occur, and, as such, the case is currently not ripe. See Response at 14.
The Defendants maintain that there are factual disputes concerning Mora County's legitimate interests in the Ordinance's enactment. See Response at 14. They contend that the Court has insufficient information to assess the dangers to public health, safety, and welfare against which
The Defendants contend that, while the Land Commissioner has dominion over state lands, that dominion is not without limitations and is subject to certain restrictions. See Response at 15-16 (citing Burguete v. Del Curto, 1945-NMSC-025, ¶ 11, 49 N.M. 292, 163 P.2d 257). Specifically, the Defendants assert that the Supreme Court of New Mexico recently held that the Land Commissioner's dominion is subject to three conditions:
Response at 15-16 (quoting King v. Lyons, 2011-NMSC-004, ¶ 7, 149 N.M. 330, 248 P.3d 878, 883). They also contend that the Oil and Gas Commission and the Oil Conservation Division do not have exclusive authority to regulate oil-and-gas drilling in New Mexico. See Response at 16-17 (citing Marbob Energy Corp. v. N.M. Oil Conservation Comm'n, 2009-NMSC-013, ¶ 1, 146 N.M. 24, 206 P.3d 135, 137). The Defendants maintain that the Oil and Gas Act and the Oil and Gas Commission are unable to effectively regulate oil-and-gas production, and that the Ordinance fills the gaps left by ineffective enforcements and regulations. See Response at 17. They assert that they will present evidence of the inadequacy of the State's current oil-and-gas regulatory scheme. See Response at 17-18. Specifically, they contend that the Oil and Gas Commission lacks the authority to impose civil penalties, and that the New Mexico Attorney General has not brought suits or imposed meaningful penalties against violators of the Oil and Gas Act. See Response at 18. The Defendants maintain that Mora County has an interest in protecting the water, air, land, and environment on its land that is adjacent to state land within Mora County, because oil spills, gas leaks, and aquifer contamination do not stop at property boundaries. See Response at 18. They argue that, without discovery, the Court does not have sufficient information to balance Mora County's governmental interest against SWEPI, LP's infringement claims. See Response at 19.
The Defendants argue that the Supremacy Clause does not create a private right of action. See Response at 18-19. They contend that some federal statute must exist before the Court can engage in a Supremacy Clause analysis. See Response at 19 (citing City of N.Y. v. F.C.C., 486 U.S. 57, 63, 108 S.Ct. 1637, 100 L.Ed.2d 48 (1988)). The Defendants argue that there is a factual dispute concerning whether Mora County acted in an unreasonable, arbitrary, or invidious manner, because they denied this allegation in the Answer. See Response at 19 (citing Answer ¶ 63, at
The Defendants argue that the Court should deny the Motion, "because the people of Mora County possess the inherent and constitutional right of local community self-government, the right to governmental protection of their fundamental civil rights, and the right to change their local system of government if it denies these rights." Response at 20. They contend that
Response at 20-22 (footnotes omitted)(emphasis in original). They further contend that the United States Congress has codified the Declaration of Independence as an "organic law" and that principles from the Declaration of Independence are embedded into the preamble to the Constitution. Response at 21 n. 4 (citing 1 U.S.C. § i-iii).
The Defendants argue that corporate constitutional rights nullify Mora County residents' self-governing authority. See Response at 22. They contend that, for the past 150 years, the judiciary has conferred on corporations rights that were once intended to protect only natural persons. See Response at 23. They assert that corporations "are, of course, property, and property itself is incapable of possessing civil or political rights." Response at 23 n. 8. The Defendants list a number of constitutional rights that the Supreme Court has recognized that corporations hold. See Response at 23 & n. 9, n. 10, n. 11 (citing First Nat'l Bank of Boston v. Bellotti, 435 U.S. 765, 98 S.Ct. 1407, 55 L.Ed.2d 707 (1978); Fong Foo v. United States, 369 U.S. 141, 82 S.Ct. 671, 7 L.Ed.2d 629 (1962); Pa. Coal Co. v. Mahon, 260 U.S. at 393, 43 S.Ct. 158; Hale v. Henkel, 201 U.S. 43, 26 S.Ct. 370, 50 L.Ed. 652 (1906), overruled in part by Murphy v. Waterfront Comm'n of N.Y. Harbor, 378 U.S. 52, 84 S.Ct. 1594, 12 L.Ed.2d 678 (1964); Noble v. Union River Logging R. Co., 147 U.S. 165, 13 S.Ct. 271, 37 L.Ed. 123 (1893); Minneapolis & St. Louis R.R.
The Defendants contend that corporations are creations of the state. See Response at 24 (citing Hale v. Henkel, 201 U.S. at 75, 26 S.Ct. 370; People v. N. River Sugar Ref. Corp., 121 N.Y. 582, 24 N.E. 834 (1890)). They assert that the Constitution protects people from the state and all of its creations. See Response at 24 (citing W. Va. State Bd. of Educ. v. Barnette, 319 U.S. 624, 637, 63 S.Ct. 1178, 87 L.Ed. 1628 (1943)). The Defendants argue that corporations have continued to use their constitutional rights to restrict lawmaking. See Response at 24-26 (citing McCutcheon v. Fed. Election Comm'n, ___ U.S. ___ 134 S.Ct. 1434, 188 L.Ed.2d 468 (2014); Citizens United v. Fed. Election Comm'n, 558 U.S. at 310, 130 S.Ct. 876; Pac. Gas & Elec. Co. v. Pub. Utils. Comm'n, 475 U.S. 1, 106 S.Ct. 903, 89 L.Ed.2d 1 (1986); Dow Chem. Co. v. United States, 476 U.S. 227, 106 S.Ct. 1819, 90 L.Ed.2d 226 (1986); Cent. Hudson Gas & Elec. Corp. v. Pub. Service Comm'n, 447 U.S. 557, 100 S.Ct. 2343, 65 L.Ed.2d 341 (1980); United States v. Union Pac. R.R. Co., 98 U.S. 569, 25 L.Ed. 143 (1978); Marshall v. Barlow's, Inc., 436 U.S. 307, 98 S.Ct. 1816, 56 L.Ed.2d 305 (1978); United States v. Martin Linen Supply Co., 430 U.S. 564, 97 S.Ct. 1349, 51 L.Ed.2d 642 (1977); Fong Foo v. United States, 369 U.S. at 141, 82 S.Ct. 671; Fed. Trade Comm'n v. Am. Tobacco Co., 264 U.S. 298, 44 S.Ct. 336, 68 L.Ed. 696 (1924); Pa. Coal Co. v. Mahon, 260 U.S. at 393, 43 S.Ct. 158; Noble v. Union River Logging R. Co., 147 U.S. at 165, 13 S.Ct. 271; Int'l Dairy Foods Ass'n v. Amestoy, 92 F.3d 67 (2d Cir.1996); S.D. Farm Bureau, Inc. v. Hazeltine, 340 F.3d 583 (8th Cir.2003); Synagro-WWT, Inc. v. Rush Twp., 204 F.Supp.2d 827 (M.D.Pa.2002) (McClure, J.); United States v. Armco Steel Corp., 252 F.Supp. 364 (S.D.Cal.1966) (Hall, J.); City of Cincinnati v. Morris Inv. Co., 6 Ohio Misc.2d 1, 451 N.E.2d 259 (Ohio Mun. Ct.1982)). The Defendants contend that, by allowing corporate constitutional rights to override the authority of a community to make its own rules and law, the rights of property routinely and unconstitutionally supersede the collective rights of people. See Response at 26. They argue that this failure in Mora County's system of government triggered the Mora County residents to replace their county government with a government that recognizes the people's self-governing authority and that protects their rights. See Response at 26.
The Defendants argue that Mora County residents have certain fundamental rights, including the right to water, the right to a healthy environment, and the right to a sustainable energy future, and that Mora County residents decided that hydrocarbon extraction activities would violate those fundamental rights. See Response
Response at 27 (emphasis in original).
The Defendants contend that, if the Court invalidates any portions of the Ordinance, those portions are severable from the remaining Ordinance. See Response at 27. They contend that an invalid portion of a law can be severed from the remaining portions if: (i) the invalid portion would not impair the force and effect of the valid portions; (ii) the legislative purpose of the valid portion can be given force and effect without the invalid portions; and (iii) it cannot be said that the legislature would not have passed the remaining portions without the invalid parts. See Response at 27 (citing Bd. of Cnty. Comm'rs v. QWest Corp., 169 F.Supp.2d 1243, 1250 (D.N.M.2001) (Conway, S.J.)). The Defendants argue that, if the Court invalidates the portions of the Ordinance concerning corporations, the remainder of the Ordinance can still be given force and effect, because it would still regulate hydrocarbon extraction. See Response at 28. They also argue that the legislative purpose of protecting the community health and safety, and providing a sustainable lifestyle, can still be given effect if the Court invalidates the provisions concerning corporations. See Response at 28. The Defendants contend that eliminating corporations' legal privileges is just one means by which the Ordinance achieves its purpose of protecting the rights of human communities, protecting nature, and preserving water. See Response at 29. Additionally, they assert that the Ordinance's severability clause demonstrates that Mora County would have passed any remaining parts even if other parts were invalidated. See Response at 29.
The Defendant-Intervenors, La Merced de Santa Getrudis de lo Mora and Jacobo Pacheco, filed the Defendant Intervenor-Applicants' Opposition to Plaintiffs' [sic] Motion for Judgement [sic] on the Pleadings, filed June 12, 2014 (Doc. 34)("Intervenor Motion"). When the Defendant-Intervenors filed the Intervenor Motion, the Court had not yet ruled on the Defendant Intervenor-Applicants' Motion to Intervene, filed March 6, 2014 (Doc. 6)("Motion to Intervene"). They argue that the Court should deny the Motion for the reasons set forth in the Defendants' Answer. See Intervenor Motion at 3. They also request that the Court postpone ruling on the Motion until the Court rules on the Motion to Intervene and provides them with an opportunity to respond to the Motion. See Intervenor Motion at 3.
SWEPI, LP replied on July 14, 2014. See SWEPI's Reply Brief in Support of
SWEPI, LP contends that the Defendants' denial of SWEPI, LP's allegation that it owns valid oil-and-gas leases in Mora County is contrary to the Defendants' judicial admissions in the Answer. See Reply at 2 (citing Answer ¶ 5, at 2 (stating that the Defendants "admit that a copy of a lease dated August 1, 2010 between the State of New Mexico and SWEPI is attached to the Complaint as Exhibit 3")). SWEPI, LP argues that the Defendants do not state a basis for retracting their judicial admission and that they cannot avoid the admission merely because it suits their current purposes. See Reply at 2 (citing Guidry v. Sheet Metal Workers Int'l Ass'n, 10 F.3d 700, 716 (10th Cir.1993), abrogated in part on reh'g, 39 F.3d 1078 (10th Cir.2994) (en banc)). It also contends that the Defendants cannot faithfully deny that the lease provides SWEPI, LP with the right to explore for, develop, and produce oil and gas. See Reply at 2 (citing Aug. 1, 2010, Lease at 1). It contends that the Memorandum of Oil and Gas Lease, filed May 13, 2014 (Doc. 20-1), was issued for the purpose of providing it with the right to explore for and produce oil and gas, and that it was filed with the Mora County Clerk's Office on June 24, 2010. See Reply at 3. SWEPI, LP argues that, because these leases are publicly filed, and because they describe matters of public record, the Court should take judicial notice of their contents. See Reply at 3 (citing Van Woudenberg ex rel. Foor v. Gibson, 211 F.3d 560, 568 (10th Cir.2000), abrogated by McGregor v. Gibson, 248 F.3d 946 (10th Cir.2001); Campos v. Las Cruces Nursing Ctr., 828 F.Supp.2d 1256, 1262 n. 3d (D.N.M.2011) (Browning, J.); Hooper v. Biloxi Reg'l Med. Ctr., Inc., No. CIV 13-0102 LG/JMR, 2013 WL 3729697, at *2 (S.D.Miss. July 15, 2013) (Guirola, C.J.)). SWEPI, LP argues that the Court may take judicial notice of the leases without converting the Motion into a motion for summary judgment. See Reply at 3-4. It argues that, because it attached the leases to the Complaint, the Court can consider them in ruling on the Motion. See Reply at 4 n. 2.
SWEPI, LP maintains that its interests in the leases confer it with standing. See Reply at 3. It argues that, because the Ordinance destroys its constitutionally protected property interests—its oil-and-gas leases—it has suffered an injury in fact. See Reply at 5 (citing Deniz v. Mun. of Guaynabo, 285 F.3d 142, 149 (1st Cir. 2002)). It argues that the Court's opinion in Alto Eldorado Partners v. City of Santa Fe, No. CIV 08-0175 JB/ACT, 2009 WL 1312856 (D.N.M. Mar. 11, 2009), aff'd 634 F.3d 1170 (10th Cir.2011), is instructive, where, according to SWEPI, LP, the Court found that the plaintiffs lacked standing to challenge a city ordinance that required thirty percent of proposed subdivided lots to have residences that were sold to low-income buyers. See Reply at 5. SWEPI, LP contends that the Court concluded that the plaintiffs did not have a definite stake in any particular project that the Ordinance affected. See Reply at 5. SWEPI, LP asserts that, here, it has established a definite interest that is affected
SWEPI, LP further argues that, even if it obtained the leases for purposes other than to explore for and extract hydrocarbons, it would have standing, because the Ordinance destroys an interest in real property. See Reply at 7. SWEPI, LP contends that, if it purchased the leases with the hope that they would appreciate in value, the destruction of the leases' value constitutes an injury in fact. See Reply at 7. It asserts that the United States Court of Appeals for the Fifth Circuit supports this argument in Energy Management Corp. v. City of Shreveport, 397 F.3d 297 (5th Cir.2005), where it held that mineral estate holders of land near Cross Lake had standing to challenge an ordinance that banned all oil-and-gas drilling within 1,000 feet of the lake. See Reply at 7-8. There, SWEPI, LP argues, the plaintiffs did not have state-issued permits, which were required to drill for oil and gas, but that the Fifth Circuit held that the plaintiffs had standing, because the right to drill is a legally protected right, which the ordinance impeded. See Reply at 8. SWEPI, LP further argues that, in Dunn McCampbell Royalty Interest, Inc. v. National Park Service, 964 F.Supp. 1125 (S.D.Tex.1995), the Honorable Janis G. Jack, United States District Judge for the Southern District of Texas, concluded that the plaintiffs could challenge a National Park Service Regulation, which required the Park Service to approve any plan of operations before someone could begin oil-and-gas exploration and extraction. See Reply at 8. There, SWEPI, LP contends, Judge Jack concluded that, even though the plaintiffs had never been denied a drilling permit, had never attempted to have the Park Service approve a plan of operations, and had never been denied a plan of operations, the plaintiffs had standing, because the challenged government actions were regulatory or proscriptive, and because the plaintiffs were subject to the regulations or prospectively subject to the regulations. See Reply at 8-9. SWEPI, LP addresses the Defendants' argument that it does not face a credible threat of prosecution by arguing that it has already shown that it has suffered a concrete injury. See Reply at 9. It further argues that it faces a credible threat, because it has engaged in conduct which the Ordinance prohibits and the First Amendment protects: filing this lawsuit. See Reply at 9 n. 6 (citing N.C. Right to Life v. Bartlett, 168 F.3d 705, 710 (4th Cir.1999)). SWEPI, LP additionally argues that its injuries can be traced to the Defendants and their actions. See Reply at 9-10.
SWEPI, LP argues that its claims are ripe for adjudication. See Reply at 10. It contends that the Defendants misunderstand the ripeness doctrine. See Reply at 10. SWEPI, LP asserts that ripeness considers whether an issue is purely legal and whether a challenged agency action is final.
SWEPI, LP contends that the Motion presents pure questions of law. See Reply at 13-14. It argues that it can bring a challenge under the Supremacy Clause, even if the federal law that preempts state law does not create a private right of action. See Reply at 14 (citing Qwest Corp. v. City of Santa Fe, 380 F.3d 1258, 1266 (10th Cir.2004)). SWEPI, LP addresses the Defendants' argument that corporations are the only entities with the resources and immunities to engage in fracking by arguing that the Ordinance prohibits more than just fracking and that there is no reason to believe that individuals would also not engage in the activities that the Ordinance prohibits. See Reply at 14-15. It contends that the Defendants have not provided any legal authority to support their assertion that corporations receive greater protections in bankruptcy. See Reply at 15. SWEPI, LP also addresses the Defendants' assertion that the Ordinance was not passed because of a corporate bias by arguing that the Ordinance's language undermines that assertion, and by stating that the "Defendants spend the last ten pages of their brief railing against what they perceive to be the evils perpetuated by affording legal rights and recognition to corporate entities." Reply at 15.
The Court held a hearing on November 3, 2014. See Transcript of Hearing (taken November 3, 2014), filed November 14, 2014 (Doc. 54)("Tr."). The Court first heard arguments on the Motion to Intervene. See Tr. at 3:13-26:18 (Anderson, Haas, Long, Court). Because the same attorney represented both the Intervenor-Defendants and the Defendants, the Court told the parties that, for the purposes of the hearing, it would "allow the intervenors to make whatever arguments they have" on the Motion, so that, if the Court later granted the Motion to Intervene, it would know their arguments regarding the
In discussing the Ordinance's origin, SWEPI, LP asserted that it believed that an environmental group on the East Coast did the original draft, and that Mora County later tailored and adopted it. See Tr. at 28:10-29:4 (Anderson, Court). The Defendants asserted that the Ordinance was prepared after many hearings were held in Mora County over a one-to-two-year period. See Tr. at 34:2-11 (Haas, Court). They stated that local committees studied the Ordinance while drafting it and that an organization called the Community Environmental Legal Defense provided legal advice. See Tr. at 34:12-25 (Haas, Court). SWEPI, LP conceded that it did not know of any oil-and-gas exploration or development in Mora County. See Tr. at 39:25-40:6 (Anderson).
SWEPI, LP and the Defendants agreed that the Court would have to deal with the jurisdictional issues of standing and ripeness before addressing the Motion's substance. See Tr. at 29:19-30:5 (Anderson, Court); id. at 32:19-24 (Haas). SWEPI, LP stated that the issues of ripeness and standing are issues for rule 12(b)(1) of the Federal Rules of Civil Procedure and that the Court can supplement the record in determining issues under rule 12(b)(1). See Tr. at 30:20-31:4 (Anderson, Court). SWEPI, LP argued, however, that the pleadings on their face establish standing. See Tr. at 31:16-20 (Anderson).
In addressing standing, SWEPI, LP repeated a number of its arguments from the Reply, arguing that the leases confer standing and that the Court can rely on them, because it attached them to the Complaint, and because they are public documents. See Tr. at 36:6-10 (Anderson).
It argued that the leases were obtained before the Defendants enacted the Ordinance and that the leases are only for the development of hydrocarbons. See Tr. at 37:11-23 (Anderson, Court). The Court asked SWEPI, LP if it purchased the leases to manufacture a lawsuit to challenge the Ordinance, and SWEPI, LP responded by stating that it invested millions of dollars to purchase dozens of leases in Mora County and that it purchased the leases in 2010, three years before the Defendants enacted the Ordinance. See Tr. at 38:12-39:10 (Anderson, Court); id. at 61:1-8 (Montaño, Court); id. at 64:5-21 (Anderson). SWEPI, LP argued that Alto Eldorado Partners v. City of Santa Fe is distinguishable, because, here, SWEPI, LP is a subsidiary of Shell Oil, which is "a major oil and gas producer and developer," and because SWEPI, LP has a concrete, identifiable stake in the case: the millions of dollars it spent on leases in Mora County. Tr. at 41:3-23 (Anderson, Court). SWEPI, LP conceded that the record does not contain evidence of a concrete plan to begin hydrocarbon exploration and development in Mora County, but it argued that holding the leases is sufficient to establish standing, especially for its takings claim. See Tr. at 42:2-43:22 (Anderson, Court). SWEPI, LP contended that its status as a corporation does not, by itself, provide it with standing, but that, because the Ordinance violates its constitutional rights, it has standing. See Tr. at 66:8-67:12 (Anderson, Court).
The Defendants addressed SWEPI, LP's contention that it spent millions of dollars in leases by arguing that, in the one lease that SWEPI, LP attached to the Complaint, SWEPI, LP paid $8,800.00 to
In addressing ripeness, SWEPI, LP largely repeated its arguments from the Reply that the Ordinance constitutes a final legislative action and that, if the Court does not determine the case, it will suffer a hardship. See Tr. at 72:7-74:12 (Anderson, Court). It argued that it does not need to expend the money and resources to explore and drill for hydrocarbons in Mora County, risking prosecution, to show that it faces a hardship for ripeness purposes. See Tr. at 75:8-20 (Anderson).
When asked about the fact that SWEPI, LP violated the Ordinance by filing the Complaint, yet Mora County has not prosecuted it, SWEPI, LP contended that it does not need to show an imminent threat of prosecution, because, for its First Amendment and equal protection claim, the Ordinance prohibits SWEPI, LP from engaging in certain activities. See Tr. at 69:18-70:14 (Anderson, Court).
The Defendants again argued that there is no evidence in the record that SWEPI, LP is prepared to explore for and extract hydrocarbons in Mora County, because it denied those allegations in their Answer, making the case premature. See Tr. at 75:24-21 (Haas). They contended that, for ripeness, SWEPI, LP must show either that it is going to be prosecuted or that, if it acts in a certain manner, it will be
SWEPI, LP noted that Mora County has a legitimate state interest in its citizens' health, safety, and welfare, including an interest in clean water. See Tr. at 83:14-84:7 (Anderson, Court). SWEPI, LP argued that a municipality cannot regulate zoning on state land, even state land that is within the municipality's borders. See 84:25-87:10 (Anderson, Court). It also argued that municipalities cannot pass ordinances that are inconsistent with rules that the State of New Mexico or its agencies promulgate. See Tr. at 87:11-24 (Anderson, Court).
The Defendants represented that, in addressing SWEPI, LP's argument that state law preempts municipal law in the oil-and-gas arena, they will show that the Oil and Gas Commission cannot regulate oil-and-gas drilling, which creates a factual issue. See Tr. at 91:2-25 (Haas, Court). They contend that, because there is insufficient state enforcement against oil-and-gas leaks and spills, they had to pass the Ordinance to protect their water. See Tr. at 92:1-25 (Haas). When the Court stated that State enforcement and the State's preemption of municipal law were legal issues, the Defendants argued that they are based on factual premises. See Tr. at 93:10-94:12 (Haas, Court). The Defendants argued that the more the Court supplements the record, the more the Motion turns into a motion for summary judgment. See Tr. at 96:19-21 (Haas).
In support of its Supremacy Clause claim, SWEPI, LP argued that the Ordinance explicitly states that it preempts federal, constitutional law. See Tr. at 98:1-99:5 (Anderson). The Defendants responded by arguing that corporate rights and community rights are included in the Constitution, the Declaration of Independence, and the nation's history, and that the Ordinance is based on "a history of law that predates the Constitution" and that is part of the Declaration of Independence, which is part of the United States Code. Tr. at 99:10-100:6 (Haas). They contended that the Ordinance does not declare that corporations are not constitutional persons, but that, if corporations violate the Ordinance, they lose their legal protections. See Tr. at 100:7-12 (Haas). The Defendants stated that it is ironic that SWEPI, LP—a corporation and property —is suing under 42 U.S.C. § 1983, which Congress passed after the Civil War to protect the rights of former slaves and to establish that people are not property, because, in this case, property is using § 1983 to sue people. See Tr. at 100:13-101:4 (Haas). They argued that the Treaty of Guadalupe Hidalgo
Concerning its equal protection claims, SWEPI, LP repeated its arguments that the Ordinance's purpose is to disempower corporations and that it was enacted based on an animus against corporations, which is not a legitimate state interest. See Tr. at 105:16-109:13 (Anderson, Court)(citing Bishop v. Smith, 760 F.3d 1070 (10th Cir. 2014)). It further argued that the Ordinance prohibits only corporations from engaging in hydrocarbon exploration and extraction. See Tr. at 116:3-118:13 (Anderson, Court). SWEPI, LP addressed the Defendants' arguments that corporations can create subsidiaries to protect themselves from liability by arguing that courts can pierce the corporate veil if it is appropriate. See Tr. 119:15-23 (Anderson). It argued that a corporation is far more likely than an individual to be able to pay damages for any leaks or spills, because of its assets, and because courts can use their equitable powers to reach through the corporation to satisfy a judgment with the shareholders' assets. See Tr. at 119:24-120:9 (Anderson).
The Defendants argued that the Ordinance prohibits individuals, as well as corporations, from engaging in hydrocarbon exploration and extraction. See Tr. at 109:21-111:13 (Haas, Court). They contended that there is a factual issue whether they passed the Ordinance because of an anti-corporation animus. See Tr. at 111:21-112:6 (Haas). The Defendants further argued that the Ordinance applies only to corporations seeking to extract hydrocarbons in Mora County and not to corporations in general, which evidences that its purpose is to protect the environment and not to penalize corporations. See Tr. at 112:7-19 (Haas); id. at 113:18-24 (Haas). They maintained that corporations are singled out in the Ordinance, because only corporations have the resources and immunities to engage in oil-and-gas extraction, and to avoid liability for spill and leaks by declaring bankruptcy. See Tr. at 112:16-113:6 (Haas). The Defendants argued that there is a factual issue whether individuals engage in oil-and-gas extraction. See Tr. at 113:6-10 (Haas). They contended that corporations create subsidiaries to protect themselves from liability, which happened in this case, because SWEPI, LP is Shell Oil's subsidiary. See Tr. at 114:23-115:10 (Haas, Court).
For its First Amendment claim, SWEPI, LP repeated some of the arguments from its briefs. See Tr. at 122:20-123:17 (Anderson). The Defendants again argued that corporate constitutional rights conflict with community rights, which provides Mora County with the power to nullify SWEPI, LP's First Amendment rights. See Tr. at 123:22-124:7 (Haas).
For its takings claim, SWEPI, LP argued that it has standing, because it needed to show only that it owns land that the Ordinance destroyed, which it has shown. See Tr. at 125:2-126:25 (Anderson, Court). It argued that its claim is based on an appropriation of property, which is a rubric of a regulatory takings claim. See Tr. at 126:7-11 (Anderson). SWEPI, LP argued
The Defendants contended that, if the Ordinance banned releasing cyanide into water streams and if SWEPI, LP's lease was for gold mining that would involve the use of cyanide, the Ordinance would not be a taking. See Tr. at 127:8-16 (Haas). They argued that, in the same way, the Ordinance protects the health and safety of Mora County residents. See Tr. at 127:17-128:16 (Haas, Court). When the Court asked the Defendants if SWEPI, LP's leases have any benefit in light of the Ordinance, they argued that it could still gather water or other minerals that are not hydrocarbons. See Tr. at 128:25-130:12 (Haas, Court).
SWEPI, LP and the Defendants repeated their arguments from their briefs for the substantive due-process claims. See Tr. at 134:9-135:15 (Anderson, Haas, Court). For its state-law preemption claim, SWEPI, LP argued that the Court would have diversity jurisdiction to decide the state-law claims if the Court ruled in its favor for its federal claims. See Tr. at 136:20-137:23 (Montaño, Court). It argued that local government cannot ban activities that the state government has said are permissible. See Tr. at 138:1-17 (Montaño); id. at 143:13-144:1 (Montaño). SWEPI, LP argued that a county cannot impose zoning regulations on state lands, even if the state lands are leased to a private party, because, once the state land is leased, the Land Commissioner still retains interest in the property. See Tr. at 139:15-140:18 (Montaño, Court). SWEPI, LP contended that this restriction applies even when the state is acting in a commercial fashion and when the state lands are within a municipality's borders. See Tr. at 141:11-142:17 (Montaño, Court). It further argued that regulating oil-and-gas production on state lands economically affects the State of New Mexico, because the State receives royalties from the state lands. See Tr. at 147:7-18 (Montaño). SWEPI, LP asserted that counties often regulate activities above ground, while the State often regulates activities that occur below ground. See Tr. at 148:12-17 (Montaño).
The Defendants argued that the Oil and Gas Act does not explicitly preempt local governments from regulating oil and gas, and that the Ordinance does not regulate oil-and-gas extraction, but bans it. See Tr. at 145:9-19 (Haas, Court). They argued that, if conduct on state lands affects the water on the adjoining Mora County lands, Mora County has a right to regulate the conduct that is occurring on the state lands. See Tr. at 146:10-22 (Haas). Additionally, the Defendants argued that, if the Court decides the federal issues, it would not have diversity jurisdiction over the case, because arms of the state, including counties, are not citizens of the state for diversity purposes. See Tr. at 174:24-176:2 (Long, Court)(citing Moor v. Alameda Cnty., 411 U.S. 693, 93 S.Ct. 1785, 36 L.Ed.2d 596 (1973)).
The Defendants again argued that the Ordinance's purpose is to protect Mora County's environment and to prohibit oil-and-gas extraction, not to discriminate against corporations. See Tr. at 157:11-158:12 (Haas). They asserted that, if the Court invalidates the Ordinance's distinction between corporations and individuals, the Court should sever those portions from the remaining provisions. See Tr. at 158:13-21 (Haas). The Defendants also argued that the Ordinance contains a severability clause, which states that any invalid portions should be severed from the rest of the Ordinance. See Tr. at 160:7-161:9 (Haas).
The Court stated that it was inclined to find that SWEPI, LP has standing, based solely on the leases, and especially if SWEPI, LP supplements the record with additional documents supporting standing. See Tr. at 71:3-12 (Court). The Court also informed the parties that it was inclined to find that the case is ripe. See Tr. at 82:18-5 (Court). For SWEPI, LP's equal protection claim, the Court noted that it was inclined to find that the distinction between corporations and individuals was not based on a legitimate rational basis. See Tr. at 121:9-122:15 (Court). The Court stated that it was inclined to invalidate the portion of the Ordinance that says that corporations do not have First or Fifth Amendment rights in Mora County. See Tr. at 124:11-125:1 (Court). The Court noted that it would likely invalidate some of the Ordinance's provisions as a violation of SWEPI, LP's substantive due-process rights. See Tr. at 135:16-23 (Court).
On November 19, 2014, SWEPI, LP filed the Notice of Supplemental Evidence Relating to Justiciability, filed November 19, 2014 (Doc. 57)("SWEPI Supplement"). SWEPI, LP attached to its supplement copies of thirty-six oil-and-gas leases from Mora County. SWEPI Supplement at 1-5. Each of the oil-and-gas leases were executed in 2008 or 2010. See SWEPI Supplement at 1-5. According to the leases, SWEPI, LP paid a total of $216,200.00 for all of the leases. See SWEPI Supplement at 1. SWEPI, LP states that it submitted the supplemental evidence for the purpose of the establishing the Court's subject matter jurisdiction over the case. See SWEPI Supplement at 1 (citing Newton v. Dep't of Veterans Affairs, No. CIV 12-0163 JB/LAM, 2014 WL 1285494 (D.N.M. Mar. 26, 2014) (Browning, J.)).
On December 15, 2014, the Defendants filed the Defendants' Notice of Supplemental Evidence Relating to Justiciability, filed December 15, 2014 (Doc. 65)("Defendants 1st Supplement"). The Defendants attached to their supplement an affidavit by Dr. Kate Zeigler, who is a geologist and is the owner of Zeigler Geologic Consulting,
The Defendants also attached to its supplement a spreadsheet of all oil-and-gas wells in Mora County and an electronic mail transmission from William Jones, District IV Supervisor of the New Mexico Oil Conservation Division. See Well Spreadsheet, filed December 15, 2014 (Doc. 65-4); Electronic Mail Transmission from William Jones, District IV Supervisor of the New Mexico Oil Conservation Division, to Dianne Lindsay (Dec. 9, 2014), filed December 15, 2014 (Doc. 65-5)("Jones 1st Email"). In the electronic mail transmission, Jones states that all wells in Mora County have been plugged
The Defendants argue that this evidence shows that SWEPI, LP is not currently seeking to engage in oil-and-gas exploration and extraction in Mora County. See Defendants 1st Supplement at 2. They contend that this evidence shows that SWEPI, LP's claims are not ripe and that it lacks standing. See Defendants 1st Supplement at 2-4.
On December 16, 2014, the Defendants filed the Defendants' Second Notice of Supplemental Evidence Relating to Justiciability, filed December 16, 2014 (Doc. 67)("Defendants 2d Supplement"). The Defendants attached to their second supplement an electronic mail transmission from Jones stating that there have been no applications for oil-and-gas drilling permits in Mora County. See Electronic Mail Transmission from William Jones, District IV Supervisor of the New Mexico Oil Conservation Division, to Dianne Lindsay (Dec. 15, 2014), filed December 16, 2014 (Doc. 67-1)("Jones 2d Email"). The Defendants again argue that the lack of permit applications shows that SWEPI, LP
On January 9, 2015, the Court requested that the parties provide additional briefing on the ripeness of SWEPI, LP's takings claim. See Request for Additional Briefing, filed January 9, 2014 (Doc. 77)("Request for Briefing"). The Court noted that the United States Court of Appeals for the Tenth Circuit requires a plaintiff to first seek just compensation from the state, if adequate procedures exist, before bringing an action under the Takings Clause. See Request for Briefing at 2. The Court asked the parties to provide additional briefing whether an inverse condemnation action under N.M. Stat. Ann. § 42A-1-29 provides an adequate procedure for seeking compensation, such that federal takings law requires SWEPI, LP to file an inverse condemnation action before its takings claim is ripe. See Request for Briefing at 2-3.
The Defendants responded to the request by arguing that § 42A-1-29 provides SWEPI, LP with an adequate procedure for seeking just compensation. See Electronic Mail Transmission from Nancy R. Long to the Honorable James O. Browning, United States District Judge for the District of New Mexico at 1-2, filed January 19, 2015 (Doc. 82)("Defendants Takings Email"). They argue that SWEPI, LP has not sought compensation through an inverse condemnation action. See Defendants Takings Email at 3. The Defendants assert that, because SWEPI, LP has not sought just compensation, its takings claim is not ripe. See Defendants Takings Email at 4. SWEPI, LP did not provide any additional briefing.
"Federal courts are courts of limited jurisdiction; they are empowered to hear only those cases authorized and defined in the Constitution which have been entrusted to them under a jurisdictional grant by Congress." Henry v. Office of Thrift Supervision, 43 F.3d 507, 511 (10th Cir.1994) (citations omitted). A plaintiff generally bears the burden of demonstrating the court's jurisdiction to hear his or her claims. See Steel Co. v. Citizens for a Better Env't, 523 U.S. 83, 104, 118 S.Ct. 1003, 140 L.Ed.2d 210 (1998) ("[T]he party invoking federal jurisdiction bears the burden of establishing its existence."). Rule 12(b)(1) allows a party to raise the defense of the court's "lack of jurisdiction over the subject matter" by motion. Fed.R.Civ.P. 12(b)(1). The Tenth Circuit has held that motions to dismiss for lack of subject-matter jurisdiction "generally take one of two forms: (1) a facial attack on the sufficiency of the complaint's allegations as to subject-matter jurisdiction; or (2) a challenge to the actual facts upon which subject matter jurisdiction is based." Ruiz v. McDonnell, 299 F.3d 1173, 1180 (10th Cir.2002).
Hill v. Vanderbilt Capital Advisors, LLC, 834 F.Supp.2d 1228, 1241 (D.N.M.2011)
Williamson v. Tucker, 645 F.2d 404, 412-13 (5th Cir.1981) (quoting Mortensen v. First Fed. Sav. & Loan Ass'n, 549 F.2d 884, 891 (3d Cir.1977)).
When making a rule 12(b)(1) motion, a party may go beyond the allegations in the complaint to challenge the facts upon which jurisdiction depends, and may do so by relying on affidavits or other evidence properly before the court. See New Mexicans for Bill Richardson v. Gonzales, 64 F.3d 1495, 1499 (10th Cir.1995); Holt v. United States, 46 F.3d 1000, 1003 (10th Cir.1995). In those instances, a court's reference to evidence outside the pleadings does not necessarily convert the motion to a rule 56 motion for summary judgment. See Holt v. United States, 46 F.3d at 1003 (citing Wheeler v. Hurdman, 825 F.2d 257, 259 n. 5 (10th Cir.1987)). Where, however, the court determines that jurisdictional issues raised in a rule 12(b)(1) motion are intertwined with the case's merits, the court should resolve the motion under either rule 12(b)(6) of the Federal Rules of Civil Procedure or rule 56 of the Federal Rules of Civil Procedure. See Franklin Sav. Corp. v. United States, 180 F.3d 1124, 1129 (10th Cir.1999); Tippett v. United States, 108 F.3d 1194, 1196 (10th Cir.1997). "When deciding whether jurisdiction is intertwined with the merits of a particular dispute, `the underlying issue is whether resolution of the jurisdictional question requires resolution of an aspect of the substantive claim.'" Davis ex rel. Davis v. United States, 343 F.3d 1282, 1296 (10th Cir.2003) (quoting Sizova v. Nat'l Inst. of Standards & Tech., 282 F.3d 1320, 1324 (10th Cir.2002)).
Rule 12(b)(6) authorizes a court to dismiss a complaint for "failure to state a claim upon which relief can be granted." Fed.R.Civ.P. 12(b)(6). "The nature of a Rule 12(b)(6) motion tests the sufficiency of the allegations within the four corners of the complaint after taking those allegations as true." Mobley v. McCormick, 40 F.3d 337, 340 (10th Cir.1994). The sufficiency of a complaint is a question of law, and when considering a rule 12(b)(6) motion, a court must accept as true all well-pled factual allegations in the complaint, view those allegations in the light most favorable to the non-moving party, and draw all reasonable inferences in the plaintiff's favor. See Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308, 322, 127 S.Ct. 2499, 168 L.Ed.2d 179 (2007) ("[O]nly if a reasonable person could not draw . . . an inference [of plausibility] from the alleged facts would the defendant prevail on a motion to dismiss."); Smith v. United States, 561 F.3d 1090, 1098 (10th Cir.2009) ("[F]or purposes of resolving a Rule 12(b)(6) motion, we accept as true all well-pled factual allegations in a complaint and view these allegations in the light most favorable to the plaintiff." (citing Moore v. Guthrie, 438 F.3d 1036, 1039 (10th Cir. 2006))).
To survive a motion to dismiss, a plaintiff's complaint must contain sufficient facts that, if assumed to be true, state a claim to relief that is plausible on its face. See Bell Atl. Corp. v. Twombly, 550 U.S. at 570, 127 S.Ct. 1955; Mink v. Knox, 613 F.3d 995, 1000 (10th Cir.2010). "A claim has facial plausibility when the pleaded factual content allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal, 556 U.S. at 678, 129 S.Ct. 1937 (citing Bell Atl. Corp. v. Twombly, 550 U.S. at 556, 127 S.Ct. 1955). "Thus, the mere metaphysical possibility that some plaintiff could prove some set of facts in support of the pleaded claims is insufficient; the complainant must give the court reason to believe that this plaintiff has a reasonable likelihood of mustering factual support for these claims." Ridge at Red Hawk, LLC v. Schneider, 493 F.3d 1174, 1177 (10th Cir.2007) (emphasis omitted). The Tenth Circuit stated:
Robbins v. Oklahoma, 519 F.3d 1242, 1247 (10th Cir.2008) (citations omitted)(quoting Bell Atl. Corp. v. Twombly, 550 U.S. at 570, 127 S.Ct. 1955).
Although affirmative defenses must generally be pled in the defendant's answer, not argued on a motion to dismiss, see Fed.R.Civ.P. 8(c), there are exceptions where: (i) the defendant asserts an immunity defense—the courts handle these cases differently than other motions to dismiss, see Glover v. Gartman, 899 F.Supp.2d 1115, 1137-39, 1141 (D.N.M. 2012) (Browning, J.)(citing Pearson v. Callahan, 555 U.S. 223, 129 S.Ct. 808, 172 L.Ed.2d 565 (2009); Robbins v. Oklahoma, 519 F.3d at 1242); and (ii) where the facts establishing the affirmative defense are apparent on the face of the complaint, see Miller v. Shell Oil Co., 345 F.2d 891, 893 (10th Cir.1965) ("Under Rule 12(b), a defendant may raise an affirmative defense by a motion to dismiss for the failure to state a claim. If the defense appears plainly on the face of the complaint itself, the motion may be disposed of under this rule."). The defense of limitations is the affirmative defense that is most likely to be established by the uncontroverted facts in the complaint. See 5 Charles Alan Wright, Arthur R. Miller, Mary Kay Kane, Richard L. Marcus & Adam N. Steinman, Federal Practice & Procedure: Civil § 1277, at 643 (3d ed.2004). If the complaint sets forth dates that appear, in the first instance, to fall outside of the statutory limitations period, then the defendant may move for dismissal under rule 12(b)(6). See Rohner v. Union Pac. R.R.
Any party may move for judgment on the pleadings if no material facts are in dispute, and the dispute can be resolved on both the pleadings and any facts of which the Court can take judicial notice. See Fed.R.Civ.P. 12(c). A motion pursuant to rule 12(c) of the Federal Rules of Civil Procedure is generally treated in the same manner as a rule 12(b)(6) motion to dismiss. See Mock v. T.G. & Y. Stores Co., 971 F.2d 522, 528 (10th Cir.1992). The court accepts all well-pleaded allegations of the non-moving party as true and views all facts in a light most favorable to the non-moving party. See Seamons v. Snow, 84 F.3d 1226, 1231-32 (10th Cir. 1996). In ruling on a motion to dismiss for failure to state a claim, "courts should look to the specific allegations in the complaint to determine whether they plausibly support a legal claim for relief." Alvarado v. KOB-TV, L.L.C., 493 F.3d 1210, 1215 n. 2 (10th Cir.2007) (citation omitted)(citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)); Erickson v. Pardus, 551 U.S. 89, 127 S.Ct. 2197, 167 L.Ed.2d 1081 (2007).
Section 1983 of Title 42 of the United States Code provides:
42 U.S.C. § 1983. "To state a claim under § 1983, a plaintiff must allege the violation of a right secured by the Constitution and laws of the United States, and must show that the alleged deprivation was committed by a person acting under color of state law." West v. Atkins, 487 U.S. 42, 48, 108 S.Ct. 2250, 101 L.Ed.2d 40 (1988). Individual, non-supervisory defendants may be liable if they knew or reasonably should have known that their conduct would lead to the deprivation of a plaintiff's constitutional rights by others, and an unforeseeable intervening act has not terminated their liability. See Martinez v. Carson, 697 F.3d 1252, 1255 (10th Cir.2012) ("The requisite causal connection is satisfied if [the defendants] set in motion a series of events that [the defendants] knew or reasonably should have known would cause others to deprive [the plaintiffs] of [their] constitutional rights.")(quoting Trask v. Franco, 446 F.3d 1036, 1046 (10th Cir. 2006)). The Supreme Court has made clear that there is no respondeat superior liability under 42 U.S.C. § 1983. See Ashcroft v. Iqbal, 556 U.S. 662, 675, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) ("Because vicarious liability is inapplicable to Bivens [
"Under Section 1983, liability attaches only to conduct occurring `under color of law.'" Gallagher v. Neil Young Freedom Concert, 49 F.3d 1442, 1447 (10th Cir.1995). The under-color-of-state-law requirement is a "jurisdictional requisite for a § 1983 action, which . . . furthers the fundamental goals of preserving an area of individual freedom by limiting the reach of federal law . . . and avoiding imposing on the state, its agencies or officials, responsibility for conduct for which they cannot fairly be blamed." Jojola v. Chavez, 55 F.3d 488, 492 (10th Cir.1995). "The traditional definition of acting under color of state law requires that the defendant in a § 1983 action have exercised power `possessed by virtue of state law and made possible only because the wrongdoer is clothed with the authority of state law.'" West v. Atkins, 487 U.S. at 49, 108 S.Ct. 2250 (quoting United States v. Classic, 313 U.S. 299, 326, 61 S.Ct. 1031, 85 L.Ed. 1368 (1941)). "The authority with which the defendant is allegedly `clothed' may be either actual or apparent." Jojola v. Chavez, 55 F.3d at 493. Accordingly, at a base level, to find that an action was taken under color of state law, the court must find that "`the conduct allegedly causing the deprivation of a federal right' must be
In the context of a public employee, the Tenth Circuit has directed that, while "`state employment is generally sufficient to render the defendant a state actor . . . [,]' at the same time, it is `well settled that an otherwise private tort is not committed under color of law simply because the tortfeasor is an employee of the state.'" Jojola v. Chavez, 55 F.3d at 493 (quoting Lugar v. Edmondson Oil Co., 457 U.S. at 935-36 n. 18, 102 S.Ct. 2744; Mark v. Borough of Hatboro, 51 F.3d 1137, 1150 (3d Cir.1995)). Thus, "before conduct may be fairly attributed to the state because it constitutes action `under color of state law,' there must be `a real nexus' between the employee's use or misuse of their authority as a public employee, and the violation allegedly committed by the defendant." Jojola v. Chavez, 55 F.3d at 493. What constitutes the required real nexus, however, is not completely clear. As the Tenth Circuit has stated, whether there is a real nexus in a particular case depends on the circumstances:
David v. City & Cnty. of Denver, 101 F.3d 1344, 1353 (10th Cir.1996) (internal citations omitted) (quoting Martinez v. Colon, 54 F.3d 980, 986 (1st Cir.1995)).
Government actors may be liable for the constitutional violations that another committed, if the actors "set in motion a series of events that the defendant knew or reasonably should have known would cause others to deprive the plaintiff of her constitutional rights," thus establishing the "requisite causal connection" between the government actor's conduct and a plaintiff's constitutional deprivations. Trask v. Franco, 446 F.3d 1036, 1046 (10th Cir.2006). The Tenth Circuit has explained that § 1983 liability should be "`read against the background of tort liability that makes a man responsible for the natural consequences of his actions.'" Martinez v. Carson, 697 F.3d at 1255 (quoting Monroe v. Pape, 365 U.S. 167, 187, 81 S.Ct. 473, 5 L.Ed.2d 492 (1961), overruled in part by Monell v. Dep't of Soc. Servs., 436 U.S. at 663, 98 S.Ct. 2018). "Thus, Defendants are liable for the harm proximately caused by their conduct." Martinez v. Carson, 697 F.3d at 1255 (citing Trask v. Franco, 446 F.3d at 1046). As the Court has previously concluded, "a plaintiff who establishes liability for deprivations of constitutional rights actionable under 42 U.S.C. § 1983 is entitled to recover compensatory damages for all injuries suffered as a consequence of those deprivations. The recovery should be guided by common-law tort principles— including principles of causation. . . ." Train v. City of Albuquerque, 629 F.Supp.2d 1243, 1251 (D.N.M.2009) (Browning, J.).
The Tenth Circuit has found liability for those defendants who proximately caused an injury alleged under § 1983 and stated that the fact that the "conduct of other people may have concurrently caused the harm does not change the outcome as to [the defendant]," so long as there was not a superseding-intervening cause of a plaintiff's
Trask v. Franco, 446 F.3d at 1046. Thus, in the context of a claim under the Fourth Amendment, the Tenth Circuit has held that government actors "may be held liable if the further unlawful detention and arrest would not have occurred but for their conduct and if there were no unforeseeable intervening acts superseding their liability." Martinez v. Carson, 697 F.3d at 1255. The Tenth Circuit gave an example of a superseding-intervening cause, quoting the Honorable Samuel J. Alito, then-United States Circuit Judge for the United States Court of Appeals for the Third Circuit, now-Associate Justice for the Supreme Court:
Trask v. Franco, 446 F.3d at 1046 (quoting Bodine v. Warwick, 72 F.3d at 400). Additionally, "[f]oreseeable intervening forces are within the scope of the original risk, and . . . will not supersede the defendant's responsibility." Trask v. Franco, 446 F.3d at 1047 (quoting William Lloyd Prosser et al., Prosser and Keeton on Torts § 44, at 303-04 (5th ed.1984)). If
Trask v. Franco, 446 F.3d at 1047 (citing Restatement (Second) of Torts § 453 cmt. b (1965)).
The Tenth Circuit has held that supervisors are not liable under 42 U.S.C. § 1983 unless there is "`an affirmative link. . . between the constitutional deprivation and either the supervisor's personal participation,. . . exercise of control or direction, or . . . failure to supervise.'" Gallagher v. Shelton, 587 F.3d 1063, 1069 (10th Cir.
The Tenth Circuit has recognized that Ashcroft v. Iqbal limited, but did not eliminate, supervisory liability for government officials based on an employee's or subordinate's constitutional violations. See Garcia v. Casuas, 2011 WL 7444745, at *25-26 (citing Dodds v. Richardson, 614 F.3d 1185 (10th Cir.2010)). The language that may have altered the landscape for supervisory liability in Ashcroft v. Iqbal is as follows: "Because vicarious liability is inapplicable to Bivens and § 1983 suits, a plaintiff must plead that each Government-official defendant, through the official's own individual actions, has violated the Constitution." Ashcroft v. Iqbal, 556 U.S. at 676, 129 S.Ct. 1937. The Tenth Circuit in Dodds v. Richardson held:
614 F.3d at 1199. The Tenth Circuit noted that Ashcroft v. Iqbal "does not purport to overrule existing Supreme Court precedent," but stated that "Iqbal may very well have abrogated § 1983 supervisory liability as we previously understood it in this circuit in ways we do not need to address to resolve this case." Dodds v. Richardson, 614 F.3d at 1200. It concluded that Ashcroft v. Iqbal did not alter "the Supreme Court's previously enunciated § 1983 causation and personal involvement analysis." Dodds v. Richardson, 614 F.3d at 1200. The Tenth Circuit, based on this conclusion, set forth a test for supervisory liability under § 1983 after Ashcroft v. Iqbal:
Dodds v. Richardson, 614 F.3d at 1199-1200 (citing Summum v. City of Ogden, 297 F.3d 995, 1000 (10th Cir.2002)). The Tenth Circuit noted, however: "We do not mean to imply that these are distinct analytical prongs, never to be intertwined." Dodds v. Richardson, 614 F.3d at 1200 n. 8. Relying on the Supreme Court's opinion in Board of County Commissioners v. Brown, the Tenth Circuit reasoned that two of the prongs often, if not always, are sufficient proof that the third prong has been met also:
Dodds v. Richardson, 614 F.3d at 1200 n. 8 (quoting Bd. of Cnty. Comm'rs v. Brown, 520 U.S. at 404-05, 117 S.Ct. 1382) (internal quotation marks omitted). The Tenth Circuit noted that "[w]e think the same logic applies when the plaintiff sues a defendant-supervisor who promulgated, created, implemented or possessed responsibility for the continued operation of a policy that itself violates federal law." Dodds v. Richardson, 614 F.3d at 1200 n. 8. Thus, the Tenth Circuit reduced the test to what can be seen as a two-part test for supervisor liability, requiring the plaintiff to prove "an `affirmative' link . . . between the unconstitutional acts by their subordinates and their `adoption of any plan or policy . . .—express or otherwise —showing their authorization or approval of such misconduct.'" Dodds v. Richardson, 614 F.3d at 1200-01 (quoting Rizzo v. Goode, 423 U.S. 362, 371, 96 S.Ct. 598, 46 L.Ed.2d 561 (1976)).
A municipality will not be held liable under § 1983 solely because its officers inflicted injury. See Graves v. Thomas, 450 F.3d 1215, 1218 (10th Cir.2006). Rather, to establish municipal liability under § 1983, a plaintiff must demonstrate: (i) that an officer committed an underlying constitutional violation; (ii) that a municipal policy or custom exists; and (iii) that there is a direct causal link between the policy or custom, and the injury alleged. See Graves v. Thomas, 450 F.3d at 1218. When a claim is brought against a municipality for failing to train its officers adequately, the plaintiff must show that the municipality's inaction was the result of deliberate indifference to the rights of its inhabitants. See Graves v. Thomas, 450 F.3d at 1218.
A federal court may hear cases only where the plaintiff has standing to sue. Standing has two components. First, standing has a constitutional component arising from Article III's requirement that federal courts hear only genuine cases or controversies. Second, standing has a prudential component. See Habecker v. Town of Estes Park, Colo., 518 F.3d 1217, 1224 n. 7 (10th Cir.2008) (noting that, in addition to constitutional standing requirements, "the Supreme Court recognizes a set of `prudential' standing concerns that may prevent judicial resolution of a case even where constitutional standing exists"). The burden of establishing standing rests on the plaintiff. See, e.g., Steel Co. v. Citizens for a Better Env't, 523 U.S. 83, 104, 118 S.Ct. 1003, 140 L.Ed.2d 210 (1998). The plaintiff must "allege . . . facts essential to show jurisdiction. If they fail to make the necessary allegations, they have no standing." FW/PBS v. City of
"Article III of the Constitution limits the jurisdiction of federal courts to Cases and Controversies." San Juan County v. United States, 503 F.3d 1163, 1171 (10th Cir.2007) (en banc). See U.S. Const. art. III, § 2. "In general, this inquiry seeks to determine `whether [the plaintiff has] such a personal stake in the outcome of the controversy as to assure that concrete adverseness which sharpens the presentation of issues upon which the court so largely depends for illumination.'" Wyoming ex rel. Crank v. United States, 539 F.3d 1236, 1241 (10th Cir.2008) (quoting Massachusetts v. EPA, 549 U.S. 497, 127 S.Ct. 1438, 167 L.Ed.2d 248 (2007)) (alterations in Wyoming ex rel. Crank v. United States but not in source)(internal quotation marks omitted). "[A] suit does not present a Case or Controversy unless the plaintiff satisfies the requirements of Article III standing." San Juan County v. United States, 503 F.3d at 1171. To establish standing, a plaintiff must show three things: "(1) an injury in fact that is both concrete and particularized as well as actual or imminent; (2) a causal relationship between the injury and the challenged conduct; and (3) a likelihood that the injury would be redressed by a favorable decision." Protocols, LLC v. Leavitt, 549 F.3d 1294, 1298 (10th Cir.2008) (internal quotation marks omitted).
"Standing is determined as of the time the action is brought." Smith v. U.S. Court of Appeals, for the Tenth Circuit, 484 F.3d 1281, 1285 (10th Cir.2007) (quoting Nova Health Sys. v. Gandy, 416 F.3d 1149, 1154 (10th Cir.2005)). In Smith v. U.S. Court of Appeals, for the Tenth Circuit, the Tenth Circuit rejected a plaintiff's standing to challenge the Colorado appellate courts' practice of deciding cases in non-precedential, unpublished opinions, which the plaintiff asserted allowed courts to affirm incorrect decisions without interfering with official, "published" law. The Tenth Circuit noted that the plaintiff had recently taken his state appeal and, therefore,
484 F.3d at 1285.
By contrast, in Nova Health Sys. v. Gandy, the Tenth Circuit found that abortion providers had standing to challenge an Oklahoma parental-notification law on the grounds that they were in imminent danger of losing patients because of the new law. Although finding standing, the Tenth Circuit was careful to frame the issue as whether, "as of June 2001 [the time the lawsuit was filed]," Nova faced any imminent
"Prudential standing is not jurisdictional in the same sense as Article III standing." Finstuen v. Crutcher, 496 F.3d 1139, 1147 (10th Cir.2007). Prudential standing consists of "a judicially-created set of principles that, like constitutional standing, places limits on the class of persons who may invoke the courts' decisional and remedial powers." Bd. of County Comm'rs v. Geringer, 297 F.3d 1108, 1112 (10th Cir.2002) (internal quotation marks omitted). Generally, there are three prudential-standing requirements: (i) "a plaintiff must assert his own rights, rather than those belonging to third parties"; (ii) "the plaintiff's claim must not be a generalized grievance shared in substantially equal measure by all or a large class of citizens"; and (iii) "a plaintiff's grievance must arguably fall within the zone of interests protected or regulated by the statutory provision or constitutional guarantee invoked in the suit." Bd. of Cnty. Comm'rs v. Geringer, 297 F.3d at 1112 (internal quotation marks and citations omitted).
A "plaintiff generally must assert his own legal rights and interests, and cannot rest his claim to relief on the legal rights or interests of third parties." Aid for Women v. Foulston, 441 F.3d 1101, 1111 (10th Cir.2006) (quoting Warth v. Seldin, 422 U.S. 490, 499, 95 S.Ct. 2197, 45 L.Ed.2d 343 (1975)). There is an exception to this general rule, however, known as third-party standing or jus tertii. Third-party standing is allowed when: (i) "the party asserting the right has a close relationship with the person who possesses the right"; and (ii) "there is a hindrance to the possessor's ability to protect his own interests." Aid for Women v. Foulston, 441 F.3d at 1111-12.
"In order for a claim to be justiciable under Article III, it must be shown to be a ripe controversy." New Mexicans for Bill Richardson v. Gonzales, 64 F.3d at 1499. Ripeness pertains to the timing of a case and is intended "to prevent the courts, through avoidance of premature adjudication, from entangling themselves in abstract disagreements." New Mexicans for Bill Richardson v. Gonzales, 64 F.3d at 1499 (citation omitted)(internal quotation marks omitted). Ripeness is a component of the Article III requirement that limits judicial review to "cases or controversies." U.S. Const. art. III, § 2. See U.S. West, Inc. v. Tristani, 182 F.3d 1202, 1208 (10th Cir.1999). A controversy must be "definite and concrete, touching the legal relations of parties having adverse legal interests," and "a real and substantial controversy admitting of specific relief through a decree of a conclusive character." Aetna Life Ins. Co. v. Haworth, 300 U.S. 227, 240-41, 57 S.Ct. 461, 81 L.Ed. 617 (1937). "[T]he question in each case is whether the facts alleged, under all circumstances, show that there is a substantial controversy, between parties having adverse legal interests, of sufficient immediacy and reality to warrant the issuance of a declaratory judgment." MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118, 127, 127 S.Ct. 764, 166 L.Ed.2d 604 (2007) (citation omitted).
In MedImmune, Inc. v. Genentech, Inc., a patent licensee, who continued to pay
Zemel v. Rusk, 381 U.S. at 19-20, 85 S.Ct. 1271.
In Eccles v. Peoples Bank, 333 U.S. 426, 68 S.Ct. 641, 92 L.Ed. 784 (1948), the Supreme Court held that a declaratory-judgment action was not ripe. See 333 U.S. at 427, 68 S.Ct. 641. The bank sought to challenge a condition imposed on its membership in the Federal Reserve System that restricted Transamerica Corporation's ownership of its stock. See Eccles v. Peoples Bank, 333 U.S. at 428-29, 68 S.Ct. 641. Transamerica Corporation
Eccles v. Peoples Bank, 333 U.S. at 432, 68 S.Ct. 641. In the Supreme Court's view, "[t]he concurrence of these contingent events, necessary for injury to be realized, is too speculative to warrant anticipatory judicial determinations." Eccles v. Peoples Bank, 333 U.S. at 432, 68 S.Ct. 641. It concluded: "[The] Bank's grievance here is too remote and insubstantial, too speculative in nature, to justify an injunction against the Board of Governors, and therefore equally inappropriate for a declaration of rights." Eccles v. Peoples Bank, 333 U.S. at 434, 68 S.Ct. 641. Addressing these Supreme Court cases, the Tenth Circuit has held: "The Court made clear that generally one cannot bring a declaratory judgment action just to resolve one isolated issue in a possible future controversy." Columbian Fin. Corp. v. BancInsure, Inc., 650 F.3d 1372, 1380 (10th Cir.2011).
In Plant Oil Powered Diesel Fuel Systems, Inc. v. ExxonMobil Corp., 801 F.Supp.2d 1163 (D.N.M.2011) (Browning, J.), the Court held that certain claims that a proposed fit-for-purpose guideline violated antitrust principles was not ripe, because the plaintiff had not shown a hardship, and because the claims were based on "uncertain or contingent future events." 801 F.Supp.2d at 1184. The Court found that, "[b]ecause the Fit-for-Purpose Guidelines are both in their early stages and because their development is on-going, creating uncertainty what form they will ultimately take if and when they are submitted for approval, the Court concludes that POP Diesel's claims based on the Fit-for-Purpose Guidelines are premature." Plant Oil Powered Diesel Fuel Sys., Inc. v. ExxonMobil Corp., 801 F.Supp.2d at 1185. In Carroll v. Los Alamos National Security, LLC, 704 F.Supp.2d 1200 (D.N.M.2010) (Browning, J.), the Court found that negligent misrepresentation claims were ripe for adjudication. See 704 F.Supp.2d at 1219. There, the defendant conceded that an employee gave the plaintiff incorrect information when the plaintiff was deciding on a pension plan. See Carroll v. Los Alamos Nat'l Sec., LLC, 704 F.Supp.2d at 1219. The Court found that the plaintiff had a legally protected interest in being given correct information regarding his pension-plan options and in making a fully informed selection. See Carroll v. Los Alamos Nat'l Sec., LLC, 704 F.Supp.2d at 1220. The Court held that, because the plaintiff had a legally protected interest in receiving accurate information and there was no dispute that he did not, he was injured, and the matter was
The Takings Clause of the Fifth Amendment to the Constitution of the United States states that "private property" shall not "be taken for public use, without just compensation." U.S. Const. amend. V. The Supreme Court has stated: "The Takings Clause of the Fifth Amendment, applicable to the States through the Fourteenth Amendment, . . . prohibits the government from taking private property for public use without just compensation." Palazzolo v. Rhode Island, 533 U.S. 606, 617, 121 S.Ct. 2448, 150 L.Ed.2d 592 (2001). A government actor can "take" property for the purposes of the Fifth Amendment either by physically depriving the owner of the property or by placing upon the property such restrictive regulations that the owner is effectively deprived of the ability to use the property. See Palazzolo v. Rhode Island, 533 U.S. at 617, 121 S.Ct. 2448 (noting that "even a minimal `permanent physical occupation of real property' requires compensation under the Clause," and that "a regulation which `denies all economically beneficial or productive use of land' will require compensation under the Takings Clause").
An overbreadth challenge is a facial challenge to a speech-restricting statute on First Amendment grounds, and, if successful, it results in the invalidation of the entire statute. To succeed, the challenged statute must regulate substantially more expression than the First Amendment allows governments to regulate. See Schad v. Borough of Mt. Ephraim, 452 U.S. 61, 101 S.Ct. 2176, 68 L.Ed.2d 671 (1981). The party challenging the statute need not have been engaged in constitutionally protected expression to have standing to challenge the law; even if the law is constitutional as applied to the challenging party, if the law is found to be overbroad, it is invalid in its entirety. See Village of Schaumburg v. Citizens for a Better Env't, 444 U.S. 620, 634, 100 S.Ct. 826, 63 L.Ed.2d 73 (1980) ("Given a case or controversy, a litigant whose own activities are unprotected may nevertheless challenge a statute by showing that it substantially abridges the First Amendment rights of other parties not before the court." (citations omitted)). There are, thus, two aspects of an overbreadth challenge that set it apart from other facial challenges: the substantive aspect and the standing aspect.
Outside of the First-Amendment context, for a party to succeed in facially challenging a statute, "the challenger must establish that no set of circumstances exists under which the Act
An example of a successful overbreadth challenge occurred in Schad v. Borough of Mt. Ephraim. In that case, a club that featured nude dancing challenged a city ordinance that purported to ban all live entertainment in commercial zones.
"[T]he overbreadth of a statute must not only be real, but substantial as well, judged in relation to the statute's plainly legitimate sweep." Broadrick v. Oklahoma, 413 U.S. 601, 615-16, 93 S.Ct. 2908, 37 L.Ed.2d 830 (1973). In Broadrick v. Oklahoma, the Supreme Court upheld a state law, patterned on the federal Hatch Act of 1939, 5 U.S.C. §§ 7321-7326, that barred government employees from engaging in partisan political activities. See 413 U.S. at 615-16, 93 S.Ct. 2908. On its face, the statute could be construed to ban forms of expression, like wearing partisan buttons and displaying partisan bumper stickers on vehicles, that both parties agreed the First Amendment protected.
As to where the line is between insubstantial overbreadth and substantial overbreadth, the Supreme Court has stated:
Members of the City Council of L.A. v. Taxpayers for Vincent, 466 U.S. 789, 800-01, 104 S.Ct. 2118, 80 L.Ed.2d 772 (1984) (footnote omitted) (citations omitted).
When assessing whether an overbroad statute is likely to chill third parties from engaging in protected expression, courts should assess not only whether the number of unconstitutional potential applications of the statute is significant relative to the overall number of applications, but the level of interpretive discretion given to those in charge of its enforcement, and the likelihood of capricious enforcement. In City of Houston v. Hill, 482 U.S. 451, 107 S.Ct. 2502, 96 L.Ed.2d 398 (1987), the Supreme Court struck down as overbroad a city ordinance making it a crime "for any person to assault, strike or in any manner oppose, molest, abuse or interrupt any policeman in the execution of his duty." 482 U.S. at 455, 107 S.Ct. 2502 (quoting Code of Ordinances, City of Houston, Tex. § 34-11(a) (1984)). The Supreme Court held that the ordinance was "not narrowly tailored to prohibit only disorderly conduct or fighting words," 482 U.S. at 465, 107 S.Ct. 2502, and "criminalizes a substantial amount of constitutionally protected speech, and accords the police unconstitutional discretion in enforcement," 482 U.S. at 466, 107 S.Ct. 2502. The Supreme Court explained:
City of Houston v. Hill, 482 U.S. at 465-67, 107 S.Ct. 2502 (citations to the record omitted). The Court presumes that, assuming the same level of overbreadth, the threat of criminal sanctions produces a stronger chilling effect than that of civil monetary sanctions, directions to cease and desist, or exposure to civil liability.
Some commentators have suggested that, when considering whether a statute's overbreadth is substantial, courts should take into account the importance of the protected speech being restricted or chilled. See Richard Fallon, Jr., Making Sense of Overbreadth, 100 Yale L.J. 853, 894 (1991). Under this view, a statute that chills a swath of political speech should be more readily facially invalidated than one that chills sexual, frivolous, or even artistic speech—the latter statute being more amenable to as-applied challenges. Although the Supreme Court has not endorsed this view explicitly, it has held that "the overbreadth doctrine does not apply to commercial speech." Village of Hoffman Estates v. Flipside, Hoffman Estates, Inc., 455 U.S. 489, 497, 102 S.Ct. 1186, 71 L.Ed.2d 362 (1982).
In Griffin v. Bryant, 30 F.Supp.3d 1139 (D.N.M.2014) (Browning, J.), the Court found that a plaintiff had standing to challenge a municipality's rule prohibiting statements criticizing the municipality's employees or governing body. Even though the plaintiff had not been penalized for violating the municipality's rule, because the rule likely affected his speech, he had suffered a sufficient injury in fact to establish standing. See Griffin v. Bryant, 30 F.Supp.3d at 1175-77.
A non-First Amendment, non-overbreadth facial challenge is always more difficult to mount than an as-applied challenge to the same statute. See United States v. Salerno, 481 U.S. at 745, 107 S.Ct. 2095. An as-applied challenge requires only that the law is unconstitutional as applied to the challenger's case; a facial challenge requires this showing as well
Broadrick v. Oklahoma, 413 U.S. at 610, 93 S.Ct. 2908 (citations omitted).
The relative difficulty of mounting facial and as-applied challenges is almost, but not entirely, reversed in the context of a First Amendment overbreadth challenge. Although a successful as-applied challenge does not guarantee a victorious facial challenge—the court could find the statute's overbreadth insubstantial—it is not necessary to have a viable as-applied challenge to succeed on a facial challenge. "[W]here the claim is that a statute is overly broad in violation of the First Amendment, . . . [there is] no requirement that the person making the attack demonstrate that his own conduct could not be regulated by a statute drawn with the requisite narrow specificity." Sec'y of State of Md. v. Joseph H. Munson Co., 467 U.S. 947, 957, 104 S.Ct. 2839, 81 L.Ed.2d 786 (1984). Even if the challenger engaged in constitutionally unprotected, validly penalized speech, if he can establish that the statute penalizes a substantial swath of protected speech, then he will prevail in getting the statute invalidated not only as it relates to the constitutionally protected speech of others, but to his own unprotected speech as well. For example, if a statute criminalized "demeaning, threatening, or inflammatory words," a challenger arrested for using "fighting words" in a bar—unprotected speech which may be validly criminalized under Chaplinsky v. New Hampshire, 315 U.S. 568, 62 S.Ct. 766, 86 L.Ed. 1031 (1942)— could challenge the law on behalf of third parties who might risk arrest for constitutionally protected demeaning or inflammatory words, see Gooding v. Wilson, 405 U.S. 518, 92 S.Ct. 1103, 31 L.Ed.2d 408 (1972) (invalidating a Georgia law making it a crime for "[a]ny person [to], without provocation, use . . . opprobrious words or abusive language, tending to cause a breach of the peace").
The relaxation of the usual standing rules in the overbreadth context goes further than simply allowing an individual to whom the law is constitutionally applied to sue on the basis of unconstitutional applications. The challenged law need not have been applied against the challenger at all; as long as the barebones requirements of Article III standing are met,
Sec'y of State of Md. v. Joseph H. Munson Co., 467 U.S. at 957-58, 104 S.Ct. 2839 (citations omitted).
The Fourteenth Amendment's Due Process Clause provides that "no
A government actor's official conduct intended to injure in a way that cannot reasonably be justified by any government interest most likely shocks the conscience. See Cnty. of Sacramento v. Lewis, 523 U.S. 833, 849, 118 S.Ct. 1708, 140 L.Ed.2d 1043 (1998) ("[C]onduct intended to injure in some way unjustifiable by any government interest is the sort of official action most likely to rise to the conscience-shocking level."). "[A] plaintiff must do more than show that the government actor intentionally or recklessly caused injury to the plaintiff by abusing or misusing government power." Camuglia v. City of Albuquerque, 448 F.3d 1214, 1222 (10th Cir.2006) (quoting Moore v. Guthrie, 438 F.3d 1036, 1040 (10th Cir. 2006)). "The plaintiff must demonstrate a degree of outrageousness and a magnitude of potential or actual harm that is truly conscience shocking." Camuglia v. City of Albuquerque, 448 F.3d at 1222-23 (quoting Uhlrig v. Harder, 64 F.3d 567, 574 (10th Cir.1995)) (internal quotation marks omitted).
Camuglia v. City of Albuquerque, 448 F.3d at 1223 (quoting Uhlrig v. Harder, 64 F.3d at 574).
"Whether the conduct shocks the conscience is an objective test, based on the circumstances, rather than a subjective test based on the government actor's knowledge." Peña v. Greffet, 922 F.Supp.2d 1187, 1227 (D.N.M.2013) (Browning, J.)(citing James v. Chavez, 830 F.Supp.2d 1208, 1276 (D.N.M.2011) (Browning, J.), aff'd, 511 Fed.Appx. 742 (10th Cir.2013) (finding that the use of deadly force did not shock the conscience even if the suspect did not have intent to harm the officer, because the officer "had sufficient facts before him to conclude that there was a threat of serious physical harm" and the "courts must evaluate a [government actor's] conduct objectively")).
In Martinez v. Uphoff, 265 F.3d 1130 (10th Cir.2001), the widow of a corrections officer sued the director, deputy director, warden, and deputy wardens of the department of corrections, alleging that the defendants deliberately failed to ensure proper training and supervision of penitentiary personnel, failed to provide safe and adequate staffing, and failed to take corrective action to protect her husband, all of which resulted in him being killed during the escape of three inmates. See 265 F.3d at 1132. The district court found that the
In Schaefer v. Las Cruces Public School District, 716 F.Supp.2d 1052 (D.N.M.2010) (Browning, J.), the plaintiffs alleged that the defendants—the school district, superintendent, principal, and vice principal of a middle school—violated the plaintiffs' substantive due-process rights when they did not take sufficient action to prevent a student at the school from "racking"
716 F.Supp.2d at 1074-75.
To obtain a permanent injunction, the party requesting such relief bears the burden of showing: "(1) actual success on the merits; (2) irreparable harm unless the injunction is issued; (3) the threatened injury outweighs the harm that the injunction may cause the opposing party; and (4) the injunction, if issued, will not adversely affect the public interest." Fisher v. Oklahoma Health Care Auth., 335 F.3d 1175, 1180 (10th Cir.2003) (citations omitted). To obtain a preliminary injunction, a plaintiff must show: "(1) a substantial likelihood of success on the merits, (2) that the plaintiff will suffer irreparable injury if the preliminary injunction is denied, (3) that the threatened injury to the plaintiff out-weighs the injury to the defendant(s) caused by the preliminary injunction, and (4) that an injunction is not adverse to the public interest." Aid for Women v. Foulston, 441 F.3d at 1115 (citation omitted).
It is a fundamental precept of American law that the federal courts are "courts of limited jurisdiction." Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. 546, 552, 125 S.Ct. 2611, 162 L.Ed.2d 502 (2005). Federal courts "possess only that power authorized by Constitution and statute." Kokkonen v. Guar. Life Ins. Co. of Am., 511 U.S. 375, 377, 114 S.Ct. 1673, 128 L.Ed.2d 391 (1994). Among the powers that Congress has bestowed upon the courts is the power to hear controversies arising under federal law—federal-question jurisdiction—and controversies arising between citizens of different states—diversity jurisdiction. See 28 U.S.C. §§ 1331-32.
Although a statutory basis is necessary for federal courts to exercise jurisdiction over a controversy, "it is well established—in certain classes of cases—that, once a court has original jurisdiction over some claims in the action, it may exercise supplemental jurisdiction over additional claims that are part of the same case or controversy." Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. at 552, 125 S.Ct. 2611. The term "supplemental jurisdiction" is now used to refer collectively to the common-law doctrines of ancillary jurisdiction, pendent jurisdiction, and pendant-party jurisdiction. 28 U.S.C. § 1367, statutorily codifying Owen Equip. & Erection Co. v. Kroger, 437 U.S. 365, 98 S.Ct. 2396, 57 L.Ed.2d 274 (1978) (outlining the doctrine of ancillary jurisdiction), and United Mine Workers of Am. v. Gibbs, 383 U.S. 715, 86 S.Ct. 1130, 16 L.Ed.2d 218 (1966) (outlining the doctrine of pendent jurisdiction), and invalidating Finley v. United States, 490 U.S. 545, 109 S.Ct. 2003, 104 L.Ed.2d 593 (1989) (rejecting the doctrine of pendent-party jurisdiction). Federal courts may exercise pendent jurisdiction over state-law claims when "state and federal claims ... derive from a common nucleus of operative fact." United Mine Workers v. Gibbs, 383 U.S. at 725, 86 S.Ct. 1130. Supplemental jurisdiction gives federal courts the flexibility to hear a cause of action after the introduction of third parties whose insertion into the litigation lacks support of any independent grounds for federal jurisdiction, when those parties share a common interest in the outcome of the litigation and are logical participants in it. See Owen Equip. & Erection Co. v. Kroger, 437 U.S. at 375 n. 18, 98 S.Ct. 2396.
In 1988, the Honorable William H. Rehnquist, Chief Justice of the United States, created the Federal Courts Study Committee to analyze the federal court system and to recommend reforms. See James v. Chavez, No. CIV 09-0540 JB/CG, 2011 WL 6013547, at *5 (D.N.M. Nov. 21, 2011) (Browning, J.)(citing 16 James W. Moore et al., Moore's Federal Practice § 106.04[5] (Matthew Bender 3d ed.)). In response to the Committee's findings regarding pendent, ancillary, and pendent-party jurisdiction, Congress codified the doctrines when it passed the Judicial Improvements Act of 1990:
28 U.S.C. § 1367(a). In enacting 28 U.S.C. § 1367, Congress conferred upon federal district courts "supplemental forms of jurisdiction ... [that] enable them to take full advantage of the rules on claim and party joinder to deal economically—in single rather than multiple litigation—with matters arising from the same transaction or occurrence." Report of the Federal Courts Study Committee, Part II.2.B.2.b. (April 2, 1990), reprinted in 22 Conn. L.Rev. 733, 787 (1990).
The Tenth Circuit has followed the Supreme Court's lead in classifying supplemental jurisdiction, not as a litigant's right, but as a matter of judicial discretion. See Estate of Harshman v. Jackson Hole Mountain Resort Corp., 379 F.3d 1161, 1165 (10th Cir.2004) (citing City of Chi. v. Int'l Coll. of Surgeons, 522 U.S. 156, 173, 118 S.Ct. 523, 139 L.Ed.2d 525 (1997)). In circumstances where the supplemental jurisdiction statute may support supplemental jurisdiction, the district court retains discretion to decline to exercise that jurisdiction. The traditional analysis, based on the Supreme Court's opinion in United Mine Workers v. Gibbs, compelled courts to consider "judicial economy, convenience and fairness to litigants" when deciding whether to exercise supplemental jurisdiction. 383 U.S. at 726, 86 S.Ct. 1130. Similarly, Congress' supplemental jurisdiction statute enumerates four factors that the court should consider:
28 U.S.C. § 1367(c). In applying these factors, district courts should seek to exercise supplemental jurisdiction in an effort to "vindicate values of economy, convenience, fairness, and comity." Estate of Harshman v. Jackson Hole Mountain Resort Corp., 379 F.3d at 1164.
Numerous courts have acknowledged that 28 U.S.C. § 1367(c) necessarily changed the district courts' supplemental jurisdiction discretion analysis and that, unless one of the conditions of 28 U.S.C. § 1367(c) exists, courts are not free to decline jurisdiction. See Itar-Tass Russian News Agency v. Russian Kurier, Inc., 140 F.3d 442, 447 (2d Cir.1998) ("[S]ection 1367 has indeed altered Gibbs' discretionary analysis."); McLaurin v. Prater, 30 F.3d 982, 985 (8th Cir.1994) ("The statute plainly allows the district court to reject jurisdiction over supplemental claims only in the four instances described therein."); Exec. Software N. Am. v. U.S. Dist. Court, 24 F.3d 1545, 1557 (9th Cir.1994) ("By codifying preexisting applications of Gibbs in subsections (c)(1)-(3), however, it is clear that Congress intended the exercise of discretion to be triggered by the court's identification of a factual predicate that corresponds to one of the section 1367(c) categories."), overruled
The Tenth Circuit has held that district courts should generally decline jurisdiction over state claims when federal claims no longer remain: "When all federal claims have been dismissed, the court may, and usually should, decline to exercise jurisdiction over any remaining state claims." Koch v. Del City, 660 F.3d 1228, 1248 (10th Cir.2011) (quoting Smith v. City of Enid ex rel. Enid City Comm'n, 149 F.3d 1151, 1156 (10th Cir.1998)). The Supreme Court has also recognized:
United Mine Workers of Am. v. Gibbs, 383 U.S. at 726, 86 S.Ct. 1130. The Court has previously stated that a district court should usually decline to exercise supplemental jurisdiction when one of the 28 U.S.C. § 1367(c) factors applies. See Armijo v. New Mexico, No. CIV 08-0336, 2009 WL 3672828, at *4 (D.N.M. Sept. 30, 2009) (Browning, J.). The Tenth Circuit has recognized that a district court does not "abuse [its] discretion" when it declines to exercise supplemental jurisdiction over a claim "under 28 U.S.C. § 1367(c)(3)... where it `has dismissed all claims over which it has original jurisdiction.'" Muller v. Culbertson, 408 Fed.Appx. 194, 197 (10th Cir.2011) (unpublished) (quoting 28 U.S.C. § 1367(c)(3)).
The Court will grant the Motion in part and deny it in part, and will invalidate the Ordinance. The Court will consider evidence outside the pleadings solely for the purpose of determining issues of standing and ripeness, because the Court may consider evidence in determining justiciability issues. SWEPI, LP has standing to bring each of its claims, because it has suffered an injury in fact. Because the Defendants have already enacted the Ordinance, and because SWEPI, LP would suffer harm if the Court delayed considering its claims, each of SWEPI, LP's claims are ripe, except for its claim under the Takings Clause. Because SWEPI, LP has not sought just compensation through a state inverse condemnation action, its takings claim is not ripe. SWEPI, LP may bring its claim under the Supremacy Clause, because it could bring independent claims, through 42 U.S.C. § 1983, under the constitutional provisions that it asserts trumps the Ordinance. Additionally, the Ordinance violates the Supremacy Clause, because it conflicts with federal law. The Ordinance does not, however, violate SWEPI, LP's substantive due-process rights or the Equal Protection Clause, because the Defendants had a legitimate state interest for enacting the Ordinance. The Ordinance violates the First Amendment by chilling protected First Amendment conduct. Because the Defendants lack the authority to enforce zoning laws on New Mexico state lands, they may not enforce the Ordinance on state lands. Also, because there is room for concurrent jurisdiction between state and local law, New Mexico state law does not preempt the entire oil-and-gas production field. The Ordinance conflicts, however, with state law by prohibiting activities that state law permits: the production and extraction of oil and gas. Finally, the invalid provisions are not severable from the valid provisions, making the Ordinance, in its entirety, invalid.
The Court can consider the supplemented record to determine justiciability issues. Depending on the substance and issues involved in a 12(c) motion for judgment on the pleadings, the Court will either treat it as a rule 12(b)(6) motion or a rule 12(b)(1) motion. Normally, rule 12(c) motions are determined under the same standard as rule 12(b)(6) motions. See Mock v. T.G. & Y. Stores Co., 971 F.2d at 528. If, however, a motion challenges the Court's subject-matter jurisdiction, it is resolved under rule 12(b)(1)'s standard. See, e.g., Ponca Tribe of Indians of Okla. v. Cont'l Carbon Co., 439 F.Supp.2d 1171, 1173 (W.D.Okla.2006) (noting that, because the defendants' rule 12(c) motion "challenges the Court's subject matter jurisdiction, it will be considered under the standards applicable to Rule 12(b)(1) motions" (citing 5C Charles A. Wright & Arthur R. Miller, Federal Practice and Procedure § 1267 (3d ed.2004)("For example, if a party raises an issue as to the court's subject matter jurisdiction on a motion for a judgment on the pleadings, the district judge will treat the motion as if it had been brought under Rule 12(b)(1)."))); Hellmann-Blumberg v. Univ. of Pac., No. CIV 12-0286, 2013 WL 1326469 (E.D.Cal. Mar. 29, 2013) (Burrell, S.J.)(considering 12(c) motion under 12(b)(1) standard).
This case is in a unique procedural posture. SWEPI, LP—the plaintiff—filed the Motion pursuant to rule 12(c), and, in response, the Defendants argue that
The Defendants' arguments that SWEPI, LP lacks standing and that its claims are not ripe are issues that are normally resolved under rule 12(b)(1). See United States v. Rodriguez-Aguirre, 264 F.3d 1195, 1202 n. 5 (10th Cir.2001) ("Although the motion to dismiss did not specify the Rule of Civil Procedure under which dismissal was sought, we assume it was Rule 12(b)(1) regarding the standing argument...."); New Mexicans for Bill Richardson v. Gonzales, 64 F.3d at 1499 ("The question of ripeness, like other challenges to a court's subject matter jurisdiction, is treated as a motion under Rule 12(b)(1)."). The rest of the Motion and the Response, however, goes to the merits of SWEPI, LP's claims, and the Court should consider the merits under rule 12(b)(6)'s standard. The Court will thus consider the Defendants' standing and ripeness arguments under a rule 12(b)(1) standard, and will consider the remaining arguments and issues under a rule 12(b)(6) standard.
At least two courts have applied a 12(b)(1) standard to certain issues in a motion for judgment on the pleadings while applying a 12(b)(6) standard to other issues. In Muir v. Winston-Salem State University, No. CIV 11-0282, 2012 WL 683359 (M.D.N.C. Mar. 2, 2012) (Tilley, S.J.), the Honorable Norwood Carlton Tilley, Jr., United States Senior Judge for the Middle District of North Carolina, in deciding a motion pursuant to rule 12(c), concluded that some of the plaintiff's claims should be decided under a 12(b)(6) standard while others should be decided under a 12(b)(1) standard. See 2012 WL 683359, at *3 & n. 5 ("Mr. Muir's failure to exhaust his administrative remedies as to his hostile work environment claim would, however, be the proper subject of a 12(b)(1) motion. Accordingly, Mr. Muir's hostile work environment claim is considered independently of his claims of discrete acts of discrimination." (citation omitted)). Similarly, in Mittleider v. Canadian Pacific Railway Company, No. CIV 11-4054 KES, 2012 WL 1231939 (D.S.D. Apr. 12, 2012) (Schreier, C.J.), the Honorable Karen E. Schreier, Chief United States District Judge for the District of South Dakota, applied both a 12(b)(1) standard and 12(b)(6) standard to the defendants' motion for judgment on the pleadings. See 2012 WL 1231939, at *2. Specifically, Judge Schreier applied a 12(b)(1) standard to the defendants' argument that the court lacked subject-matter jurisdiction, and she applied a 12(b)(6) standard to the defendants' argument that
Accordingly, the Court will treat the Defendants' subject-matter jurisdiction arguments—lack of standing and ripeness—under a rule 12(b)(1) standard and will consider the rest of the Motion under a rule 12(b)(6) standard. The Court will thus consider the parties' supplemental evidence for purpose of resolving the jurisdictional issues—whether SWEPI, LP has standing and whether its claims are ripe—but will not consider anything outside the pleadings and the documents attached the pleadings in resolving the rest of the Motion.
SWEPI, LP has standing. SWEPI, LP must demonstrate standing on each of its claims and for each form of relief that it seeks. See Davis v. Fed. Election Comm'n, 554 U.S. 724, 734, 128 S.Ct. 2759, 171 L.Ed.2d 737 (2008) ("Standing is not dispensed in gross. Rather, a plaintiff must demonstrate standing for each claim he seeks to press and for each form of relief that is sought." (alterations omitted) (citations omitted)(internal quotation marks omitted)). SWEPI, LP has met its burden. The Defendants' standing arguments appear to be based on the constitutional standing requirements and not on prudential standing grounds.
SWEPI, LP has suffered an injury in fact that provides it with standing for each of its claims. An injury in fact means the "invasion of a legally protected interest that is `(a) concrete and particularized, and (b) actual or imminent, not conjectural or hypothetical.'" N.E. Fla. Chapter of Associated Gen. Contractors of Am. v. City of Jacksonville, 508 U.S. 656, 663, 113 S.Ct. 2297, 124 L.Ed.2d 586 (1993) (quoting Lujan v. Defenders of Wildlife, 504 U.S. at 560, 112 S.Ct. 2130). SWEPI, LP's injury for almost all of its claims centers around the devaluation, or complete destruction of value, in its leases.
SWEPI, LP suffered an injury in fact to support its takings claim. "`The owner of an interest in property at the time of an alleged taking has standing to assert that a taking has occurred.'" Deniz v. Mun. of Guaynabo, 285 F.3d 142, 149 (1st Cir.2002) (alterations omitted) (emphasis omitted) (quoting U.S. Olympic Comm. v. Intelicense Corp., 737 F.2d 263, 268 (2d Cir.1984)). As the United States Court of Appeals for the Eighth Circuit has recognized: "There is a substantial body of law recognizing that the owner of an interest in the affected property has standing to challenge the restriction." von Kerssenbrock-Praschma v. Saunders, 48 F.3d 323, 326 (8th Cir.1995) (citing Huntington Branch NAACP v. Town of Huntington, 689 F.2d 391, 395 (2d Cir.1982); Constr. Indus. Ass'n of Sonoma Cnty. v. City of Petaluma, 522 F.2d 897, 903 (1975); Horizon House v. Twp. Of Upper Southampton, 804 F.Supp. 683, 692 (E.D.Pa. 1992) (Reed, J.), aff'd, 995 F.2d 217 (3d Cir.1993); In re Malone, 592 F.Supp. 1135, 1153-55 (E.D.Mo.1984) (Nangle, C.J.), aff'd, 794 F.2d 680 (8th Cir.1986)). See Epice Corp. v. Land Reutilization Auth., No. CIV 07-0206 HEA, 2009 WL 4730337, at *4 (E.D.Mo. Dec. 4, 2009) (Autrey, J.)("Plaintiff's property interest, however, gives rise to Plaintiff's standing to bring this lawsuit."). SWEPI, LP has presented evidence that it owns thirty-six oil-and-gas leases in Mora County. See SWEPI Supplement at 1-5. "It is well settled in [New Mexico] that a grant or reservation of the underlying oil and gas, or royalty rights therein, is a grant or reservation of real property that may be severed from the surface." Johnson v. Gray, 1966-NMSC-020, ¶ 5, 75 N.M. 726, 410 P.2d 948 (citations omitted). For a Takings Clause claim, state law determines what property rights exist. See Stop the Beach Renourishment, Inc. v. Fla. Dep't of Envtl. Prot., 560 U.S. 702, 707, 130 S.Ct. 2592, 177 L.Ed.2d 184 (2010) ("Generally speaking, state law defines property interests ...."); Vandevere v. Lloyd, 644 F.3d 957, 963 (9th Cir.2011) ("[W]e look to state law to determine what property rights exist and therefore are subject to `taking' under the Fifth Amendment."). SWEPI, LP's oil-and-gas leases are thus real property under New Mexico law. The question then is whether the Defendants have infringed this property—i.e. whether the Defendants have taken SWEPI, LP's property. Because the Ordinance prohibits SWEPI, LP from acting on its leases, the Ordinance infringes—i.e. affects—SWEPI, LP's real property interests. The Ordinance's effect on SWEPI, LP's property interests, and not the decrease in its leases' value, confers SWEPI, LP with standing. The Defendants' argument concerning the value of SWEPI, LP's leases is misplaced. Accordingly, because the Ordinance affects SWEPI, LP's leases, SWEPI, LP has standing to bring its takings claim.
In any case, even if SWEPI, LP were required to show that its leases have value that has been negatively affected by the Ordinance, it has done so. While the Court should normally decline to resolve the merits of a case before determining standing, because without standing the Court has no authority to decide the merits of the case, see Hollingsworth v. Perry, ___ U.S. ___, 133 S.Ct. 2652, 2659, 186 L.Ed.2d 768 (2013), it is necessary in this case to consider the merits of SWEPI, LP's takings claim to determine whether its leases have decreased in value. SWEPI, LP paid $216,200.00 for thirty-six oil-and-gas leases in Mora County. See SWEPI Supplement at 1. The Ordinance deprives SWEPI, LP of all economic value in its leases. As the Supreme Court noted in Pennsylvania Coal Co. v. Mahon, the "right to coal consists in the right to mine
In Energy Management Corp. v. City of Shreveport, the Fifth Circuit held that mineral interest owners had standing to challenge a city ordinance that prohibited drilling for oil and gas within one thousand feet of Cross Lake. See 397 F.3d at 299, 301-02. The Fifth Circuit, in an opinion that the Honorable W. Eugene Davis, United States Circuit Judge for the Fifth Circuit, wrote, and Judges Garza and Prado joined, held that the plaintiff had suffered an injury in fact, because its "right to exploit its mineral interests by seeking a drilling permit ... is a legally protected right." 397 F.3d at 302. The Fifth Circuit states:
397 F.3d 297, 302. Similarly, the Ordinance affects SWEPI, LP's mineral interests in Mora County. SWEPI, LP's ability to exploit its mineral interests has been infringed. This infringement is sufficient to establish an injury in fact. See 397 F.3d at 302.
The Defendants argue that SWEPI, LP has not shown that its leases have value. See Response at 7. While the Court has already concluded that SWEPI, LP has to only show an affected property interest and not a decrease in value, the Defendants' decrease-in-value argument is contrary to the evidence and would require the Court to adopt unreasonable inferences. In deciding a motion for judgment on the pleadings, the Court must "grant all reasonable inferences" in the non-moving party's favor. Park Univ. Enter., Inc. v. Am. Cas. Co. of Reading, Pa., 442 F.3d at 1239. Inferring the SWEPI, LP's leases lack value, however, is not a reasonable inference. SWEPI, LP paid $216,200.00 for the leases in the SWEPI Supplement. See SWEPI Supplement at 1. It paid $8,800.00 for the Aug. 1, 2010, Lease. See Aug. 1, 2010, Lease at 1. The Defendants do not explain why these leases, which were worth $216,800.00 four to six years ago, are suddenly worthless today. The Defendants are essentially arguing that,
The Defendants argue that SWEPI, LP is not currently prepared to engage in hydrocarbon extraction activities. See Response at 11-14. The issue whether SWEPI, LP is prepared to engage in hydrocarbon extraction activities, or whether SWEPI, LP will ever engage in hydrocarbon extraction activities, misses the mark. SWEPI, LP may never intend to act on its leases and drill for oil and gas, yet it still suffered an injury in fact, specifically, the decrease in its leases' value. See Kaing v. Pultegroup, Inc., 464 Fed.Appx. 630, 631 (9th Cir.2011) (unpublished) (noting that decreased property value is a concrete injury in fact). SWEPI, LP may be holding onto its leases as an investment. As an investment instrument, they have value, even if SWEPI, LP does not intend to act on them, because someone else may wish to purchase them, either as an investment, or to drill for oil and gas.
This reasoning holds true even if it is currently economically infeasible to drill for oil and gas in Mora County. If the Defendants were able to present evidence that, not only is SWEPI, LP not currently prepared to drill for oil and gas, but that no one would drill for oil and gas in Mora County, the Court would still find that SWEPI, LP has standing, because its leases would still have value but for the Ordinance. Oil prices are constantly fluctuating.
Finally, the Defendants may attempt to argue that there are no oil-and-gas reserves in Mora County, and, therefore, it will never be economically feasible to drill for oil and gas.
It is not necessary for the Court to determine the exact value of the leases today. All that matters is that they have value that the Ordinance destroyed. The leases' exact value would be relevant to the amount of just compensation that Mora County owes, but is not relevant to whether SWEPI, LP has standing. As long as SWEPI, LP has an interest in the leases—i.e. a legally protectable, concrete interest—then it has standing if the Ordinance infringes on this interest, which it does. This taking and destruction of SWEPI, LP's property constitutes an injury in fact. Its leases provide it with a particularized, concrete interest in property that state law protects. See Johnson v. Gray, 1966-NMSC-020, ¶ 5, 75 N.M. 726, 410 P.2d 948. The reduction in the leases' value and the destruction of all economic use is an actual injury, rather than one that is conjectural or hypothetical. See N.E. Fla. Chapter of Associated Gen. Contractors of Am. v. City of Jacksonville, 508 U.S. at 663, 113 S.Ct. 2297 (noting that an injury in fact is "an invasion of a legally protected interest that is (a) concrete and particularized, and (b) actual or imminent, not conjectural or hypothetical" (citation omitted)(internal quotation marks omitted)). Accordingly, SWEPI, LP has suffered a sufficient injury in fact to support its takings claim.
SWEPI, LP has standing to bring its substantive due-process claims for the same reason that it has standing to bring its takings claim the Ordinance has deprived it of all economic value in its leases. SWEPI, LP's substantive due-process claims centers around the deprivation of its property—its leases—for an arbitrary reason—because it is a corporation. See Complaint ¶¶ 81-102, at 17-20; Motion at 15-18. Its injury for its due-process claims is the same as its takings claim: the deprivation of its property. Because the Ordinance deprives SWEPI, LP of its value and use in its property, it has suffered a concrete, particularized injury sufficient to establish standing on its substantive due-process claims. See ConocoPhillips Co. v. Henry, 520 F.Supp.2d 1282, 1298 (N.D.Okla.2007) (Kern, J.) (finding that plaintiffs' deprivation of its right to exclude others from its property was a sufficient injury to confer it with standing on its takings claim and substantive due-process claim), rev'd sub nom. on other grounds by Ramsey Winch Inc. v. Henry, 555 F.3d 1199 (10th Cir.2009).
SWEPI, LP has suffered an injury in fact to establish standing on its First Amendment claim. SWEPI, LP asserts that the Ordinance is overbroad in its absolute prohibition of First Amendment protections. See Complaint ¶¶ 21-132, at 23-25; Motion at 10-12. The Supreme Court has established a lax standing requirement for First Amendment overbreadth challenges. See Sec'y of State of Md. v. Joseph H. Munson Co., 467 U.S. at 957-58, 104 S.Ct. 2839. The Supreme Court has held that "constitutional violations may arise from the deterrent, or chilling, effect of governmental efforts that fall short of a direct prohibition against the exercise of First Amendment rights." Bd. of Cnty. Comm'rs v. Umbehr, 518 U.S. 668, 674, 116 S.Ct. 2342, 135 L.Ed.2d 843 (1996) (alterations omitted) (citation omitted) (internal quotation marks omitted). Indeed, the Tenth Circuit has held that "a chilling effect on the exercise of a plaintiff's First Amendment rights may amount to a judicially cognizable injury in fact, as long as it `arises from an objectively justified fear of
Here, the Ordinance does more than deter or chill First Amendment rights; it prohibits them. See Ordinance § 5.5, at 4.
Section 5.5 of the Ordinance states:
Ordinance § 5.5, at 4. According to the Ordinance, because SWEPI, LP has filed suit to engage in activities that the Ordinance prohibits, SWEPI, LP lacks First Amendment rights. See Ordinance § 5.5, at 4 ("Corporations ... seeking to engage in activities prohibited by this ordinance, shall not ... be afforded rights under the 1st or 5th amendments to the United States Constitution...."). This restriction is a prohibition of SWEPI, LP's First Amendment rights.
While Mora County has not yet sought to enforce the Ordinance against SWEPI, LP through a criminal prosecution, actual enforcement is not necessary for ripeness and the Defendants have refused to state that they will not enforce the Ordinance. First, in Griffin v. Bryant, the Court concluded that a plaintiff could bring a First Amendment overbreadth challenge to a city rule, even though the plaintiff had never been punished for violating that rule. See 30 F.Supp.3d at 1175-77. The Court concluded that, because the rule "most likely affected his speech," and because of the lax standing requirements for First Amendment overbreadth challenges, the plaintiff had standing to challenge the rule. See Griffin v. Bryant, 30 F.Supp.3d at 1175-77. Second, the Defendants have refused to concede that they will not enforce the Ordinance's provisions that purport to strip corporation that violate, or that seek to violate, the Ordinance. At the hearing, the Defendants stated that, as long as SWEPI, LP did not explore for or extract hydrocarbons in Mora County, they would likely not enforce the Ordinance against it. See Tr. at 79:5-20 (Haas, Court). This restriction is essentially saying that, as long as SWEPI, LP does not violate the Ordinance, the Defendants will not prosecute it for the violation. Moreover, if the Defendants did not intend to enforce this provision, it would not so vigorously defend it. The Defendants spend about a third of their Response arguing that their community rights permit them to strip corporations of their constitutional rights. See Response at 20-29. Based on the Defendants' actions, it appears that they are prepared to fully enforce every provision in the Ordinance, including the provision stripping corporations of their First Amendment rights. There is thus a "credible threat" that the Defendants will prosecute violators of the Ordinance. Initiative & Referendum Inst. v. Walker, 450 F.3d at 1088.
SWEPI, LP has gone ahead and filed suit in violation of the Ordinance. While its willingness to violate the Ordinance and risk prosecution indicates that its First Amendment rights have not been chilled, the Tenth Circuit uses an objective test for a chilling effect and not a subjective
That the Defendants have not prosecuted SWEPI, LP for violating the Ordinance by filing this case also does not undermine its standing to bring a First Amendment claim. It is understandable that the Defendants might not want to undermine their standing and ripeness arguments by bringing criminal charges against a corporation for filing a complaint in federal court, perhaps a violation of this Ordinance that most obviously violates SWEPI, LP's First Amendment rights. The Defendants probably also want this Court's ruling on the issues presented and want to make their chances of prevailing on portions of the Ordinance that outlaws oil-and-gas exploration, which seems to be the Ordinance's primary purpose.
Accordingly, because SWEPI, LP is currently seeking to engage in activities that violate the Ordinance, because the Ordinance states that this conduct strips it of its First Amendment rights, and because the Ordinance creates a chilling effect on the exercise of First Amendment rights, SWEPI, LP has suffered an injury in fact.
SWEPI, LP has suffered an injury in fact to confer it standing on its equal-protection claim. SWEPI, LP's equal-protection claim is based on the assertions that the Ordinance discriminates against corporations by applying only to corporations and not to individuals. See Complaint ¶¶ 59-71, at 14-16; Motion at 5-10. SWEPI, LP's injury is thus that the Ordinance applies to it. The Ordinance prohibits SWEPI, LP for extracting hydrocarbons in Mora County and purports to strip SWEPI, LP of its constitutional rights. See Ordinance § 5.1, at 4 ("It shall be unlawful for any corporation to engage in the extraction of oil, natural gas, or other hydrocarbons within Mora County."); id. § 5.5 ("Corporations in violation of the prohibitions enacted by this ordinance, or seeking to engage in activities prohibited by this ordinance, shall not have the rights of `persons' afforded by the United States and New Mexico Constitutions ..."). Its injuries are the same as for its takings claim and its First Amendment claim. If the Ordinance did not apply to it, the economic value of its leases would not be destroyed. Similarly, if the Ordinance did not apply to it, the Ordinance would not purport to strip it of its constitutional
SWEPI, LP's Supremacy Clause claim is based on the fact that § 5.5 of the Ordinance purports to strip corporations of their constitutional rights if they violate or seek to engage in activities that violate the Ordinance. See Complaint ¶¶ 52-58, at 13. Motion at 3-4. SWEPI, LP's injury in fact for this claim is the same as its takings claim and its First Amendment claim. Section 5.5 states that corporations do not have constitutional rights. See Ordinance § 5.5, at 4. According to the Ordinance, SWEPI, LP does not have Fifth or Fourteenth Amendment rights to pursue its takings claims, or First Amendment rights to pursue its First Amendment claim. SWEPI, LP's Supremacy Clause claim is essentially that it does have these constitutional rights, because the Supremacy Clause nullifies § 5.5. Thus, its injury in fact for this claim is that it suffered a sufficient injury to pursue its other claims. The Court has already concluded that SWEPI, LP suffered a sufficient injury for its takings and First Amendment claims. These injuries are sufficient to confer standing for SWEPI, LP's Supremacy Clause claim. See Taubman Realty Grp. Ltd. P'ship v. Mineta, 320 F.3d 475, 481 n. 3 (4th Cir.2003) (noting that devaluation of property value was sufficient injury for Supremacy Clause claim). Consequently, SWEPI, LP has also suffered a sufficient injury in fact for its Supremacy Clause claim.
SWEPI, LP has suffered a sufficient injury in fact to bring its state-law claims. SWEPI, LP's state-law claims rely on allegations that Mora County lacks the authority to regulate oil-and-gas activities. See Complaint ¶¶ 103-120, at 20-23; Motion at 17-21. Its injury for these claims is that it is prohibited from exercising its rights under its leases; that is, it is prohibited from engaging in oil-and-gas exploration and extraction. Additionally, because the Ordinance strips SWEPI, LP's leases of value, its state-law claims are based on the same injury as its takings claim. In Energy Management Corp. v. City of Shreveport, the Fifth Circuit considered the harm to the plaintiff's mineral interests to consider whether the plaintiff had standing to bring a state law preemption claim. See 397 F.3d at 301-02. Deprivation in a property interest's value and the inability to exploit one's property interest is a sufficient injury in fact to bring a state law preemption claim. See Energy Mgmt. Corp. v. City of Shreveport, 397 F.3d at 302. Because Mora County enacted the Ordinance, SWEPI, LP's leases have been deprived of their value and SWEPI, LP is unable to act on its property interests. SWEPI, LP has thus suffered a sufficient injury to assert its state-law claims.
In addition to an injury in fact, to establish standing, SWEPI, LP must show that there is "a causal relationship between the injury and the challenged conduct," and that there is "a likelihood that the injury would be redressed by a favorable decision." Protocols, LLC v. Leavitt, 549 F.3d at 1298. The Defendants do not
First, each of SWEPI, LP's injuries are a direct result of the Ordinance's prohibitions. SWEPI, LP's leases have been devalued, because the Ordinance prohibits hydrocarbon exploration and extraction. Its First Amendment rights have been attacked and chilled because the Ordinance states that corporations that seek to violate the Ordinance lack constitutional rights. There is thus a causal relationship between SWEPI, LP's injuries and the challenged conduct—i.e. the Ordinance. Second, a favorable decision would redress its injuries. If the Ordinance is invalidated, SWEPI, LP's leases would have their value reinstated. Additionally, its First Amendment rights would no longer be chilled. Finally, SWEPI, LP could receive just compensation to reimburse it for the time in which the Ordinance took its leases. Accordingly, SWEPI, LP has shown a causal connection and redressibility, and has established that it has standing on each of its claims.
Each of SWEPI, LP's claims, except for its takings claim, are ripe for adjudication. Ripeness concerns the timing of a dispute. See Blanchette v. Conn. Gen. Ins. Corp., 419 U.S. 102, 140, 95 S.Ct. 335, 42 L.Ed.2d 320 (1974). "As a general rule, determinations of ripeness are guided by a two-factor test, requiring a court to evaluate both the fitness of the issue for judicial resolution and the hardship to the parties of withholding judicial consideration." Plant Oil Powered Diesel Fuel Sys., Inc. v. ExxonMobil Corp., 801 F.Supp.2d at 1179 (citation omitted)(internal quotation marks omitted)(alterations omitted). The fitness-of-the-issue concern focuses on "whether the case involves uncertain or contingent future events that may not occur as anticipated, or indeed may not occur at all." New Mexicans for Bill Richardson v. Gonzales, 64 F.3d at 1499 (citation omitted)(internal quotation marks omitted). The hardship-to-the-parties concern "`typically turns upon whether the challenged action creates a direct and immediate dilemma for the parties.'" New Mexicans for Bill Richardson v. Gonzales, 64 F.3d at 1499 (quoting El Dia, Inc. v. Hernandez Colon, 963 F.2d 488, 495 (1st Cir. 1992)) (internal quotation marks omitted). Each of SWEPI, LP's claims, except for its takings claim, are ripe.
SWEPI, LP's takings claim is not ripe. In determining ripeness for Takings Clause claims, courts apply a two-prong test. See Alto Eldorado Partners v. Cnty. of Santa Fe, 634 F.3d 1170, 1174 (10th Cir.2011).
Alto Eldorado Partners v. Cnty. of Santa Fe, 634 F.3d at 1174 (citations omitted). SWEPI, LP has satisfied the first prong, but not the second.
Concerning the second prong, there are existing procedures for which SWEPI, LP can seek compensation, but it has not done so. In Alto Eldorado Partners v. City of Santa Fe, the Court dismissed the plaintiffs' Takings Clause claim, because it was not ripe. See 644 F.Supp.2d at 1313. There, the plaintiffs did not seek compensation for the alleged taking, but instead brought a facial challenge against a city ordinance and a county ordinance, seeking an injunction to invalidate the ordinances. See 644 F.Supp.2d at 1313. The Court concluded that, because an injunction was inappropriate, the plaintiffs needed to first seek compensation before it could bring a Takings Clause claim. See 644 F.Supp.2d at 1333-34. The Tenth Circuit affirmed the Court's decision. See Alto Eldorado Partners v. Cnty. of Santa Fe, 634 F.3d at 1170. In an opinion that the Honorable Michael R. Murphy, United States Circuit Judge for the Tenth Circuit, authored, and Judges Holloway and O'Brien joined, the Tenth Circuit held that, even for facial regulatory takings challenges, to bring a Takings Clause claim, a plaintiff must either demonstrate that "a procedure for seeking compensation is unavailable" or must first seek compensation. 634 F.3d at 1177. Because the plaintiffs did not, before bringing suit under the Takings Clause, seek compensation through an inverse condemnation action under N.M. Stat. Ann. § 42A-1-29, the Tenth Circuit held that their claim was not ripe. See 634 F.3d at 1174.
The Defendants have not argued that SWEPI, LP failed to first seek compensation through an inverse condemnation action. Rather, the Defendants contend that the case is not ripe, because SWEPI, LP has not demonstrated that it is prepared to engage in hydrocarbon exploration and extraction. See Response at 11-13. In the Complaint, SWEPI, LP alleges that it "has no adequate legal, administrative, or other remedy by which to prevent or minimize the continuing irreparable harm to its constitutional rights," specifically "the Ordinance provides no mechanism through which Plaintiff may obtain just compensation for the regulatory taking if its property." Complaint ¶ 140, at 26. The Defendants denied the allegation in that paragraph of the Complaint. See Answer ¶ 140, at 14. Accordingly, the Court may not rely on SWEPI, LP's assertion that it has no other remedy for its takings claim and that the Ordinance does not provide it with a compensation mechanism. See Kellar v. U.S. Dep't of Veteran's Affairs, 2009 WL 1706719, at *1 (noting that a court may only consider the uncontroverted allegations in a motion for judgment on the pleadings). Whether New Mexico law or the Ordinance provides a compensation mechanism, however, is a question of law. While the Ordinance does not provide a mechanism through which SWEPI, LP could seek compensation, New Mexico law does.
New Mexico has an inverse condemnation statute, under which a person can seek compensation when an authorized person has taken or damaged property for public use without providing compensation. See N.M. State Ann. § 42A-1-29. It provides:
N.M. Stat. Ann. § 42A-1-29. In Alto Eldorado Partners v. City of Santa Fe, the Tenth Circuit noted that the plaintiffs did not seek compensation under this inverse condemnation statute. See 634 F.3d at 1174. If SWEPI, LP could seek compensation under § 42A-1-29, then its takings claim is not ripe. If, however, § 42A-1-29 does not apply, its takings claim is ripe. The Court concludes that § 42A-1-29 applies to SWEPI, LP's takings claim and that federal law requires SWEPI, LP to first seek compensation through an inverse condemnation action before its takings claim is ripe.
Section 42A-1-29 states that a "person authorized to exercise the right of eminent domain" may be liable under the statute. N.M. Stat. Ann. § 42A-1-29. A "`person' includes a natural individual, partnership, corporation, association, or other legal or fiduciary entity and a governmental entity.'" N.M. Stat. Ann. § 42A-1-2(H). Section 42A-1-29 may be interpreted to mean that, if a person has general eminent domain powers, that person may be liable in an inverse condemnation action, as long as the taking was for public use. On the other hand, § 42A-1-29 may be interpreted to mean that, if a person acted under his or her eminent domain authority, that person may be liable in an inverse condemnation action. Under the first interpretation, if a person who has eminent domain authority, acted beyond that authority, but still took or damaged another's property, the person can be liable under § 42A-1-29. Under the second interpretation, if a person who has eminent domain authority, acted beyond that authority, but still took or damaged another's property, the person cannot be liable under § 42A-1-29, because that person acted without eminent domain authority. The Court concludes that the first interpretation is correct.
The Supreme Court of New Mexico has held that § 42A-1-29 does not apply in two situations: (i) when the taking was not for public use; and (ii) when the entity conducting the taking lacked eminent domain powers. Neither situation applies here.
First, § 42A-1-29 does not apply if the taking was not for public use. In Brosseau v. New Mexico State Highway Department, 1978-NMSC-098, 92 N.M. 328, 587 P.2d 1339, the Supreme Court of New Mexico held that the State of New Mexico does not have sovereign immunity against quiet title actions. See 1978-NMSC-098, ¶ 9, 92 N.M. 328, 587 P.2d 1339. The Supreme Court of New Mexico supported its holding by noting that a plaintiff could not bring an inverse condemnation action under N.M. Stat. Ann.1953 § 22-9-22
1978-NMSC-098, ¶ 12, 92 N.M. 328, 587 P.2d 1339.
The Supreme Court of New Mexico again applied the rule from Brosseau v. New Mexico State Highway Department in Kennedy v. Yates Petroleum Corp., 1984-NMSC-033, 101 N.M. 268, 681 P.2d 53. There, the plaintiffs brought a trespass and quiet title action against an oil company that laid a natural gas pipeline across the plaintiffs' property. See 1984-NMSC-033, ¶ 1, 101 N.M. 268, 681 P.2d 53. The oil company argued that, among other things, it had eminent domain authority pursuant to N.M. Stat. Ann. § 70-3-5 to obtain a pipeline right-of-way across the plaintiffs' property. See 1984-NMSC-033, ¶ 1, 101 N.M. 268, 681 P.2d 53. Section 70-3-5 provides:
N.M. Stat. Ann. § 70-3-5(A). The Supreme Court of New Mexico held that, if the oil company's laying of the pipeline was done for public use, the plaintiffs' sole remedy was an inverse condemnation action under § 42A-1-29. See Kennedy v. Yates Petroleum Corp., 1984-NMSC-033, ¶ 14, 101 N.M. 268, 681 P.2d 53. On the other hand, if the pipeline was not laid for public use, "a suit in inverse condemnation will not lie," and the plaintiffs could pursue
In North v. Public Service Company of New Mexico, 1980-NMCA-031, 94 N.M. 246, 608 P.2d 1128, the defendant, Public Service Company of New Mexico, entered onto the plaintiff's property and bulldozed two roads that were adjacent to the plaintiff's property and a third road on the plaintiff's property, damaging the plaintiff's property. See 1980-NMCA-031, ¶ 2, 94 N.M. 246, 608 P.2d 1128. The Court of Appeals of New Mexico reversed the trial court's dismissal of the plaintiff's complaint for failing to state a claim. See 1980-NMCA-031, ¶ 9, 94 N.M. 246, 608 P.2d 1128. In specially concurring in the judgment, the Honorable Mary Walters, New Mexico Court of Appeals Judge, wrote that, because the plaintiff alleged that the defendant's trespass was not for public use, the district court should not have dismissed the plaintiff's trespass claim, because, if the trespass was not for public use, "a suit in inverse commendation [sic] will not lie." 1980-NMCA-031, ¶ 12, 94 N.M. 246, 608 P.2d 1128 (citing Brosseau v. N.M. State Highway Dep't, 1978-NMSC-098, ¶ 12, 92 N.M. 328, 587 P.2d 1339).
Neither the Supreme Court of New Mexico, in Brosseau v. New Mexico State Highway Department, nor Judge Walters, in her concurring opinion in North v. Public Service Company of New Mexico, explained their reasoning for why § 42A-1-29, or then-§ 22-9-22, does not apply if the taking was not for public use. Section 42A-1-29's inapplicability can either be because the defendants in those cases lacked authority to exercise the power of eminent domain or because § 42A-1-29, by its terms, requires the taking to be for public use. The state lacks authority to take property through eminent domain if the taking is not for public use. See Kaiser Steel Corp. v. W.S. Ranch Co., 1970-NMSC-043, ¶ 24, 81 N.M. 414, 467 P.2d 986, 992 ("[T]he power of eminent domain cannot be exercised without a `public use' being present...."); N.M. Const. art. II, § 20 ("Private property shall not be taken or damaged for public use without just compensation."). Brosseau v. New Mexico State Highway Department, Kennedy v. Yates Petroleum Corp., and Judge Walters' concurrence in North v. Public Service Company of New Mexico may stand for the proposition that, if an entity acts outside its eminent domain authority, a plaintiff cannot sue the entity under § 42A-1-29. If this interpretation is true, then SWEPI, LP was not required to bring a § 42A-1-29 action, because if Mora County did not have authority to enact the Ordinance—as SWEPI, LP argues—SWEPI, LP could not sue the Defendants under § 42A-1-29. On the other hand, Brosseau v. New Mexico State Highway Department, Kennedy v. Yates Petroleum Corp., and Judge Walters' concurrence in North v. Public Service Company of New Mexico may stand only for the proposition that § 42A-1-29 does not apply if the taking was not for public use. Section 42A-1-29's plain language suggests that the second interpretation is correct.
Section 42A-1-29 states: "A person authorized to exercise the right of eminent domain who has taken or damaged or who may take or damage any property for public use without making just compensation... is liable to the condemnee...." N.M. Stat. Ann. § 42A-1-29 (emphasis added). Section 42A-1-29's language states that the taking must be for public use for it to apply. Section 42A-1-29 does not apply when the taking is not for public use,
The second limitation on an inverse condemnation action under § 42A-1-29 is that the defendant must be "authorized to exercise the right of eminent domain." N.M. Stat. § 42A-1-29. In Manning v. New Mexico Energy, Minerals and Natural Resources Department, 2006-NMSC-027, 140 N.M. 528, 144 P.3d 87, the Supreme Court of New Mexico noted that the plaintiffs' inverse condemnation claim under § 42A-1-29 was dismissed earlier in the case, "because the State agencies [t]here do not have a statutory grant of eminent domain power." 2006-NMSC-027, ¶ 19 n. 4, 140 N.M. 528, 144 P.3d 87. Thus, if an entity does not have eminent domain powers, a plaintiff cannot sue the entity under § 42A-1-29.
First, Mora County has eminent domain powers. Section 4-52-11 of the New Mexico Statutes Annotated states that a "board of county commissioners has power to ... acquire by purchase, gift, grant, bequest, devise or through condemnation proceedings, in the manner provided in the Eminent Domain Code, such property, rights-of-way or equipment as is necessary for exercise of any authorized function of the district...." N.M. Stat. Ann. § 4-52-11. Additionally, New Mexico counties have broad authority to provide for its residents' safety, health, and prosperity. See N.M. Stat. Ann. § 4-37-1.
N.M. Stat. Ann. § 4-37-1. Mora County thus has eminent domain authority, and § 42A-1-29 applies as long as Mora County enacted the Ordinance for public use.
Second, the taking was done for public use. The Supreme Court of New Mexico has defined the phrase "for public use" as a "public entity's deliberate taking or damaging of the property in order to accomplish the public purpose." Electro-Jet Mfg. Co. v. City of Albuquerque, 1992 NMSC-060, ¶ 9, 114 N.M. 676, 845 P.2d 770, 773. Where the beneficial use of water is involved, the Supreme Court of New Mexico has been more apt to find that a taking is for public use. For instance, the Supreme Court of New Mexico held that a right of way for a private logging and mining road was not for public use while a right of way for the distribution of water was. Compare Threlkeld v. 3d Judicial Dist. Ct., 1932-NMSC-041, 36 N.M. 350, 15 P.2d 671 (logging road), and Gallup Am. Coal Co. v. Gallup S.W. Coal Co., 1935-NMSC-049, 39 N.M. 344, 47 P.2d 414 (mining road), with Kaiser Steel Corp. v. W.S. Ranch Co., 1970-NMSC-043, 81 N.M. 414, 467 P.2d 986 (water right-of-way). In Kaiser Steel Corp. v. W.S. Ranch Co., the Supreme Court of New Mexico, in holding that the exercise of eminent domain to transport water to be used by a private company was done for public use, stated that water had a "unique position" within the State's public policy.
Threlkeld v. 3d Judicial Dist. Ct., 1932-NMSC-041, ¶ 21, 36 N.M. 350, 15 P.2d 671. If a taking is accomplished for the beneficial use of water, it is done for public use.
The Ordinance is focused on the protection and use of water. Its name states that it concerns water rights. See Ordinance § 1.1, at 1 ("This Ordinance shall be known and may be cited as the `Mora County Community Water Rights and Local Self-Government Ordinance.'"). The Ordinance states that its purpose is to protect "the natural sources of water from damage related to the extraction of oil, natural gas, or other hydrocarbons." Ordinance, Introduction (capitalization removed). See id. § 1.2 (stating that the Ordinance's purpose is focused on water). The Ordinance is focused on the protection and beneficial use of water. Water in Mora County cannot be used for drinking or farming if toxins from fracking polluted the water.
Because Mora County has eminent domain authority, and because the Ordinance was enacted for a public purpose, SWEPI, LP could have brought an inverse condemnation action under § 42A-1-29 against the Defendants for the taking of its leases. SWEPI, LP's failure to bring such an action before filing this suit causes its takings claim to not be ripe. Consequently, SWEPI, LP's taking claim is not ripe.
SWEPI, LP's due-process claims are ripe. Because the Ordinance has been enacted, and because it destroys the value of SWEPI, LP's leases, its due-process claims do not involve "uncertain or contingent future events that may not occur as anticipated, or indeed may not occur at all." New Mexicans for Bill Richardson v. Gonzales, 64 F.3d at 1499. Additionally, the Ordinance creates a direct hardship to SWEPI, LP. Specifically, the value of its leases has diminished because of the Ordinance. This diminution creates a "direct and immediate dilemma" for SWEPI, LP. New Mexicans for Bill Richardson v. Gonzales, 64 F.3d at 1499. For a substantive due-process claim, there is no ripeness requirement that a plaintiff first seek compensation, even if a substantive due-process claim is based on the same injury as a Takings Clause claim. In Tri-Corp Management v. Praznik, 33 Fed.Appx. 742 (6th Cir.2002) (unpublished), the plaintiff
SWEPI, LP's First Amendment claim is ripe. Ripeness for First Amendment claims is subject to a more relaxed standard. The Tenth Circuit has stated:
New Mexicans for Bill Richardson v. Gonzales, 64 F.3d at 1499-500 (alterations omitted).
For a facial First Amendment challenge, ripeness requires consideration of three elements: (i) "hardship to the parties by withholding review"; (ii) "the chilling effect the challenged law may have on First Amendment liberties"; and (iii) "fitness of the controversy for judicial review." New Mexicans for Bill Richardson v. Gonzales, 64 F.3d at 1500. This inquiry should not "be applied mechanically but rather, with flexibility." New Mexicans for Bill Richardson v. Gonzales, 64 F.3d at 1500.
The first two elements—hardship and chilling effect—are related. As noted earlier, part of SWEPI, LP's injury is the chilling effect on First Amendment rights that the Ordinance creates. By delaying review of SWEPI, LP's First Amendment claim, the Court would be requiring SWEPI, LP to further endure this injury without redress. See U.S. W. Inc. v. Tristani,
The third element is also met. The Defendants have already enacted the Ordinance. It is currently in effect. This case does not involve "uncertain or contingent future events that may not occur as anticipated, or indeed may not occur at all." New Mexicans for Bill Richardson v. Gonzales, 64 F.3d at 1499. Accordingly, the case is fit for judicial review. Because SWEPI, LP has satisfied all three elements for ripeness on its First Amendment claim, this claim is ripe for adjudication.
SWEPI, LP's equal protection claim is ripe. As previously stated, the case is fit for judicial review. The Defendants have already enacted the Ordinance. SWEPI, LP's claim is not based on a hypothetical, uncertain event. See New Mexicans for Bill Richardson v. Gonzales, 64 F.3d at 1499. Additionally, SWEPI, LP would suffer hardship if the Court did not decide its claim. Its injury for its equal protection claim is the same as its takings and First Amendment claims—the taking of its property and the chilling of its First Amendment rights. SWEPI, LP asserts that the Ordinance applies to it because of its corporate status. See Motion at 7-10. According to SWEPI, LP, it is currently suffering an injury merely because of its corporate status and in violation of the Equal Protection Clause. See Motion at 7-10. Its injury is "direct and immediate," and will continue to exist unless the Court considers its claims, including its equal protection claim. New Mexicans for Bill Richardson v. Gonzales, 64 F.3d at 1499. Consequently, SWEPI, LP would suffer hardship if the Court did not consider its equal protection claim, and its equal protection claim is ripe for adjudication.
SWEPI, LP's Supremacy Clause claim is ripe. First, the claim is fit for adjudication, because Mora County has already enacted the Ordinance. Second, SWEPI, LP would suffer a hardship if the Court delayed resolving the case. The Defendants are already violating SWEPI, LP's First and Fourteenth Amendment rights—its property has been taken and its First Amendment rights have been chilled. The case is not based on a potential future event or injury. SWEPI, LP has brought suit, asserting the very rights that the Ordinance says that it lacks. It is thus currently facing a hardship that will continue if the Court does not resolve its claim. Accordingly, SWEPI, LP's Supremacy Clause claim is ripe.
SWEPI, LP's state-law claims are ripe for substantially the same reason that its Equal Protection and substantive due-process claims are ripe. First, the case is fit for judicial determination, because the Ordinance has already been enacted. Second, because SWEPI, LP's leases have been devalued, it is currently facing an imminent harm that it will continue to endure if the Court does not address its claims. Accordingly, SWEPI, LP's state-law claims are ripe for adjudication.
The Ordinance violates the Supremacy Clause. The Supremacy Clause provides:
U.S. Const. art. VI, cl. 2. In simpler terms, the "Supremacy Clause of the Constitution provides that federal law trumps, or preempts, contrary state laws." Russo v. Ballard Med. Prods., 550 F.3d 1004, 1011 (10th Cir.2008). Certain provisions of the Ordinance blatantly contradict federal law. Before considering whether the Court can invalidate these provisions, the Court must first determine whether SWEPI, LP may bring a claim under the Supremacy Clause.
The Defendants argue that, because the Supremacy Clause does not create a private right of action, "some form of federal statute must exist to engage in Supremacy Clause analysis." Response at 19. While the Defendants do not cite to it, they are likely referring to the Tenth Circuit's recent opinion in Planned Parenthood of Kansas and Mid-Missouri v. Moser, 747 F.3d 814 (10th Cir.2014). There, the Tenth Circuit held, in an opinion that the Honorable Harris L. Hartz, United States Circuit Judge for the Tenth Circuit, authored, and Judge O'Brien joined,
747 F.3d at 817.
In Planned Parenthood of Kansas and Mid-Missouri v. Moser, the plaintiff could not bring a private action under § 1983 for a Title X violation. See 747 F.3d at 824. In contrast, SWEPI, LP can bring First, Fifth, and Fourteenth Amendment actions under § 1983 to challenge the Ordinance. Indeed, SWEPI, LP has brought those claims. See Complaint ¶¶ 121-141, at 23-26. Moreover, the Ordinance does not merely conflict with federal law, it attempts to contradict it by stating that corporations do not have constitutional rights and by stating that federal preemptive law cannot be used to overturn the Ordinance. See Ordinance § 5.5, at 4; id. § 5.6, at 4. Because SWEPI, LP can bring its claims under the First, Fifth, and Fourteenth Amendments through § 1983, Planned Parenthood of Kansas and Mid-Missouri v. Moser not only does not prevent SWEPI, LP from bringing a claim under the Supremacy Clause for those violations, it suggests that SWEPI, LP can bring such a claim. Judge Hartz focused on the legislative intent and canons of statutory construction to determine that Title X does not create a private right of action, and thus does not create a right under the Supremacy Clause. See Planned Parenthood of Kan. & Mid-Missouri v. Moser, 747 F.3d at 823-28. It has been long recognized that a private citizen can bring an action under either the First, Fifth, or Fourteenth Amendments. See Zwickler v. Koota, 389 U.S. 241, 88 S.Ct. 391, 19 L.Ed.2d 444 (1967) (considering private action for First Amendment violation); Hannah v. Larche, 363 U.S. 420, 80 S.Ct. 1502, 4 L.Ed.2d 1307 (1960) (considering private action for Fifth Amendment violation); Hague v. Comm. for Indus. Org., 307 U.S. 496, 59 S.Ct. 954, 83 L.Ed. 1423 (1939) (considering private action for Fourteenth Amendment violation). Accordingly, SWEPI, LP may bring a claim under the Supremacy Clause in this case, arguing that those Amendments preempt and trump the Ordinance.
The Ordinance—specifically §§ 5.5, 5.6, 5.7, and 5.9—violates the Supremacy Clause. These provisions state:
Ordinance §§ 5.5, 5.6. 5.8 & 5.9, at 4-5. Each of these provisions contradicts federal constitutional law.
Section 5.5 states that corporations that violate, or seek to violate, the Ordinance do not have First or Fifth Amendment rights, nor rights under the Commerce Clause or the Contract Clause. See Ordinance § 5.5, at 4. The Supreme Court has established that corporations are "persons" within the meaning of the Equal Protection Clause and are entitled to its protections. Metro. Life Ins. Co. v. Ward, 470 U.S. 869, 881 n. 9, 105 S.Ct. 1676, 84 L.Ed.2d 751 (1985) ("It is well established that a corporation is a `person' within the meanings of the Fourteenth Amendment."). The Supreme Court has also established that corporations have First Amendment rights, see Citizens United v. Fed. Election Comm'n, 558 U.S. at 342, 130 S.Ct. 876 ("The Court has recognized that First Amendment protection extends to corporations."), and Fifth Amendment rights, see United States v. Martin Linen Supply Co., 430 U.S. at 564, 97 S.Ct. 1349 (applying Double Jeopardy Clause of the Fifth Amendment to corporations). The Ordinance, in contradiction to the Constitution and Supreme Court precedent, states that corporations that violate, or that seek to violate, the Ordinance have no First or Fifth Amendment rights. See Ordinance § 5.5, at 4. Mora County lacks the authority to nullify constitutional rights. See Haywood v. Drown, 556 U.S. at 745, 129 S.Ct. 2108 ("[The States] lack
Section 5.6 states that no one can use federal preemptive law to challenge the Ordinance. See Ordinance § 5.6, at 4. A county cannot decide when federal preemptive law applies and when it does not. While the Tenth Circuit has reigned in a private litigants' ability to apply federal preemptive law, especially under a Supremacy Clause challenge, see Planned Parenthood of Kan. & Mid-Missouri v. Moser, 747 F.3d at 824, as the Court has previously concluded, a private litigant can still bring a Supremacy Clause challenge and argue that federal law preempts state law. The Tenth Circuit has held: "The Supremacy Clause of the Constitution provides that federal law trumps, or preempts, contrary state laws." Russo v. Ballard Med. Prods., 550 F.3d at 1011. Section 5.6's proclamation that no one can use federal preemption law to overturn the contradicts federal law. Indeed, federal law preempts the provision which states that federal preemptive law does not apply. Because § 5.6 is contrary to federal law, it is invalidated under the Supremacy Clause.
The Court has previously discussed additional concerns regarding Section 5.6. See SWEPI, LP v. Mora Cnty., 2014 WL 6983288, at *48-49.
SWEPI, LP v. Mora Cnty., 2014 WL 6983288, at *48. The Court continues to have these concerns.
Sections 5.8 and 5.9 are invalid for the same reasons. Section 5.8 states that the Bill of Rights preempts of Mora County ordinances only if their "interpretation and application" is not inconsistent with the Ordinance's provisions concerning corporate rights. Ordinance § 5.8, at 5. Section 5.9 states that federal law is preemptive only if it "both expressly preempt[s] County ordinances and charters, and provide[s] greater protections for the health, safety, and welfare of the people of Mora County than County ordinances and charters." Ordinance § 5.9, at 5. Both of these provisions provide for the circumstances in which federal law may preempt Mora County law. If a county could declare under what conditions federal law
To find support for the long history of corporate constitutional rights, the Court needs to look no further than the Defendants' Response. The Defendants list numerous cases in which the Supreme Court recognized corporate constitutional rights. See Response at 23-25. They urge the Court to ignore Supreme Court precedent, arguing that the rights of property should not supersede the rights of people. See Response at 26. It is well established, however, that corporations have constitutional rights, even if they are property. See, e.g., Metro. Life Ins. Co. v. Ward, 470 U.S. at 881 n. 9, 105 S.Ct. 1676 ("It is well established that a corporation is a `person' within the meanings of the Fourteenth Amendment.").
The Defendants argue that Mora County residents' right to self-government provides them with the right to pass the Ordinance, including the provisions stripping corporations of their constitutional rights. See Response at 20-23. They argue that the Declaration of Independence and the Treaty of Guadalupe Hidalgo provide, or at least recognize, these rights. See Response at 20-23; Tr. at 102:22-103:9 (Haas, Court). The Defendants are, however, mistaken. "The Declaration of Independence is a statement of ideals, not law." Schifanelli v. U.S. Gov't, No. 88-2172, 865 F.2d 1259, at *1 (4th Cir. Dec. 22, 1988) (per curiam)(unpublished). See Rhode Island v. Massachusetts, 37 U.S. 657, 680, 12 Pet. 657, 9 L.Ed. 1233 (1838) ("[U]nder the constitution [the court] is bound by events subsequent to the declaration of independence. . . ."); Borzych v. Frank, No. CIV 06-0475 C, 2006 WL 3254497, at *8 (W.D.Wis. Nov. 9, 2006) (Crabb, J.)("However, the Declaration of Independence is not binding law. . . ."). Moreover, to whatever extent the Treaty of Guadalupe Hidalgo provides Mora
The Ordinance does not violate the Due Process Clause. SWEPI, LP brings two claims under the Due Process Clause: (i) that the Ordinance arbitrarily deprives it of its property; and (ii) that Mora County lacked either a compelling or legitimate county interest in enacting the Ordinance. See Complaint ¶¶ 81-102, at 17-20. These two claims are one and the same. At the hearing, SWEPI, LP argued that the Court should apply the shocks-the-conscience test in analyzing its due-process claims See Tr. at 135:1-5 (Anderson, Court). The shocks-the-conscience standard, however, is not the correct standard for SWEPI, LP's due-process claims. The Tenth Circuit has held that, in analyzing arbitrary government action under the Due Process Clause, if the action is executive, the shocks the conscience standard applies, but, if the action is legislative, a rational basis test applies. See Dias v. City & Cnty. of Denver, 567 F.3d 1169, 1182 (10th Cir.2009). The Tenth Circuit has stated:
Dias v. City & Cnty. of Denver, 567 F.3d at 1182 (citations omitted)(emphasis in original). Because the Mora County Commissioners is a legislative body, and because the Ordinance is a legislative enactment, under the Due Process Clause, the arbitrariness of Mora County's enactment of the Ordinance will be judged under a rational basis or strict scrutiny standard, depending on the nature of the interests involved.
SWEPI, LP's substantive due-process claims do not implicate a fundamental
SWEPI, LP argues that its oil-and-gas leases are "property interests [that] are fundamental rights protected by the Fourteenth Amendment." Complaint ¶ 91, at 18. It further argues that the Ordinance deprived it of its "fundamental property interests." Complaint ¶ 92, at 18. At the hearing, however, SWEPI, LP argued that Mora County lacked only a legitimate state interest, but did not argue that it lacked a compelling state interest. See Tr. at 134:13-24 (Anderson). In the Motion, SWEPI, LP argues that the Court must determine "whether the deprivation of SWEPI's property interest bears a rational relationship to a legitimate governmental interest." Motion at 16. Thus, in the Complaint, SWEPI, LP appears to argue that its property interests are fundamental rights, requiring a strict scrutiny analysis; at the hearing, and in the Motion, however, SWEPI, LP appears to argue that its property rights are not fundamental rights and that its substantive due-process claims should be resolved under a rational basis analysis. In any case, because its property rights are not fundamental rights, a rational basis analysis is the correct standard.
Courts have routinely held that property interests and rights do not rise to the level of fundamental rights requiring a strict scrutiny analysis. See, e.g., Weems v. Little Rock Police Dep't, 453 F.3d 1010, 1015-16 (8th Cir.2006) (holding that a case involving a resident's right to "acquire, enjoy, own and dispose of property" did not implicate a fundamental right); Hager v. City of West Peoria, 84 F.3d 865, 872 (7th Cir.1996) ("Access to real property does not rise to the level of a fundamental right such that its denial merits heightened scrutiny."); Clajon Prod. Corp. v. Petera, 70 F.3d 1566, 1580 (10th Cir.1995) (rejecting plaintiffs' argument that their fundamental right to private property required a strict scrutiny analysis by holding that "[e]conomic regulations—i.e., those burdening one's property rights—have traditionally been afforded only rational relation scrutiny"); Nat'l W. Life Ins. Co. v. Commodore Cove Improvement Dist., 678 F.2d 24, 26 (5th Cir.1982) ("The right freely to alienate real property is not a `fundamental right' that calls for application of strict scrutiny."); Dodge v. Johnson, 92 Fed.Appx. 404, 406 (9th Cir.2004) (unpublished)(holding that "interest in purchasing a particular piece of property is not a fundamental right"); Vestavia Plaza, LLC v. City of Vestavia Hills, No. CIV 2:11-4152 TMP, 2013 WL 4804196, at *11 n. 8 (N.D.Ala. Sept. 9, 2013) (Putnam, M.J.)("Being a creature of state law, rights in real property are not `fundamental' rights protected by the concept of substantive due process."); John E. Long, Inc. v.
Clajon Prod. Corp. v. Petera, 854 F.Supp. at 855. Consequently, SWEPI, LP's property interests are not fundamental rights that require a strict scrutiny analysis.
Moreover, strict scrutiny analysis would be contrary to the Supreme Court's Takings Clause jurisprudence. The Supreme Court has held that "the exercise of eminent domain power" must be "rationally related to a conceivable public purpose." Hawaii Hou. Auth. v. Midkiff, 467 U.S. 229, 241, 104 S.Ct. 2321, 81 L.Ed.2d 186 (1984). If a person's interest in property created a fundamental right, then a state would require a compelling state interest to exercise its eminent domain power over the property. The Supreme Court does not require such a heightened interest. By merely requiring a "conceivable public purpose" and requiring that the exercise of eminent domain power be "rationally related" to this purpose, the Supreme Court has indicated that person's property interest is not a fundamental right. Accordingly, SWEPI, LP's substantive due-process rights have been violated only if the Defendants lacked a legitimate county interest in enacting the Ordinance.
The Defendants have a legitimate county interest in enacting the Ordinance. It is rational that the Defendants would ban corporations, but not individuals, from engaging in hydrocarbon exploration and extraction. Such a distinction is not arbitrary. The Defendants argue that only corporations have the resources to engage in fracking, and have the immunities to avoid liability from spills and leaks by
In Dias v. City and County of Denver, the Tenth Circuit held that the plaintiffs sufficiently alleged that a city and county ordinance banning the possession of pit bull terriers lacked a legitimate state interest. See 567 F.3d at 1172-73. There, the district court dismissed the plaintiffs' substantive due-process claim under rule 12(b)(6) for failing to state a claim. See Dias v. City & Cnty. of Denver, 567 F.3d at 1172-73. In an opinion that Judge Lucero wrote, and Judges Tacha and Ebel joined, the Tenth Circuit held that, while the city and county had a legitimate interest in animal control, and in protecting the public's health and safety, the plaintiffs had sufficiently alleged that the means in which they chose to pursue these interests—banning all pit bulls—was irrational. See 567 F.3d at 1183. Specifically, the Tenth Circuit noted that the plaintiffs alleged that there was "a lack of evidence that pit bulls as a breed pose a threat to public safety or constitute a public nuisance, and thus, that it is irrational for Denver to enact a breed-specific prohibition." 567 F.3d at 1183. In distinguishing prior cases that dismissed substantive due-process challenges to pit bull bans, the Tenth Circuit noted that the state of science may have changed since those cases were decided and that the majority of those previous cases had "a developed evidentiary record." 567 F.3d at 1183 & n. 12. The Tenth Circuit held that, because the plaintiffs' claims were dismissed under rule 12(b)(6), there was no developed record to review and the court was required to assume that the plaintiffs' allegations were true. See 567 F.3d at 1184 & n. 12. Taking the plaintiffs' allegations as true, the Tenth Circuit concluded that they reasonably stated a claim that the city and county lacked a legitimate state interest in banning pit bulls but no other dog breeds. See 567 F.3d at 1184.
Here, there is no developed record. Additionally, as the non-moving party, the Court must grant all inferences in the Defendants' favor. See Smith v. United States, 561 F.3d at 1098. With these inferences, the Court cannot say that it is unreasonable for Mora County to apply the Ordinance's prohibitions to corporations but not to individuals. It is likely that only incorporated entities—corporations, limited liability companies, limited partnerships, et cetera—engage in hydrocarbon exploration and extraction. The very purpose of a corporation is to provide a mechanism in which individuals can pool large amounts of money to undertake an expensive endeavor without risking the rest of their wealth. Drilling oil-and-gas wells is expensive. A person who has enough capital to drill an oil-and-gas well will likely not do so without the limited liability of an incorporated entity. Engaging in any expensive business venture, without limited liability protections, would subject a person's entire wealth to liability if something went wrong. Using an incorporated entity, however, allows a person to risk only a definite amount of money—that which he or she invested into the entity—without risking the rest of his or her wealth. It is thus reasonable to assume that only incorporated entities, and not individuals, engage in hydrocarbon exploration and extraction.
While it is reasonable to assume that only incorporated entities drill oil-and-gas wells and engage in fracking, this assumption may not be accurate. A more developed
The Defendants also argue that corporations are able to avoid liability for spills and leaks by declaring bankruptcy. Even though this rationale may not be the soundest reasoning, it is still rational. SWEPI, LP argues that, if a corporation attempts to take advantage of the corporate form to avoid liability, a court can pierce the corporate veil. See Tr. 119:15-23 (Anderson). While undercapitalization is a factor to consider in piercing the corporate veil, it is not determinative. See Certain Underwriters at Lloyd's, London Subscribing to Policy Number 501/NB03ACMD v. Nance, 506 F.Supp.2d 700, 713 (D.N.M.2007) (Browning, J.)(noting that undercapitalization is one fact, among others, to be considered in piercing the corporate veil); Harlow v. Fibron Corp., 1983-NMCA-117, ¶ 21, 100 N.M. 379, 671 P.2d 40, 44 (holding that undercapitalization is "only one factor to be considered" in piercing the corporate veil). A corporation or an individual may avoid personal liability by establishing a corporation and then capitalizing it with just enough assets to conform with the law but not enough assets to pay out all likely liabilities. See John C. Heenan, Graceful Maneuvering: Corporate Avoidance of Liability through Bankruptcy and Corporate Law, 65 Mont. L.Rev. 99, 120-21 (2004)(noting that corporations can avoid liabilities by maintaining subsidiaries with just enough assets to comply with the law to avoid piercing but still not enough assets to satisfy creditors). By banning only corporations from engaging in hydrocarbon extraction, Mora County may be attempting to ensure that, if there are any oil leaks or spills, the perpetrator will not be able to avoid liability by using a partially undercapitalized subsidiary. The Ordinance's distinction between corporations and individuals is thus rational.
The Ordinance does not violate SWEPI, LP's equal-protection rights. SWEPI, LP asserts two separate equal-protection arguments. Its first argument is closely related to its substantive due-process claims: the Ordinance's distinction between corporations and individuals is arbitrary and does not bear a rational relationship with a legitimate state interest. See Motion at 7-8. SWEPI, LP's second argument is that the Ordinance's distinction is based on an invidious and unlawful animus. See Motion at 8-10. Both of these arguments fail.
The Ordinance is rationally related to a legitimate state interest. SWEPI, LP argues that disparate treatment between corporations and individuals bears no rational relationship to a legitimate governmental purpose. See Motion at 7. SWEPI, LP relies heavily on the 1929 Supreme Court case, Frost v. Corporation Commission of Oklahoma. See Motion at 7-8. That case stands, however, for the proposition that arbitrary disparate treatment between corporations and individuals bears no rational relationship to a legitimate governmental purpose, and not that all disparate treatment bears no such rational relationship. See Frost v. Corp. Comm'n of Okla., 278 U.S. at 522, 49 S.Ct. 235. There, the City of Durant, Oklahoma, passed a law requiring a permit for the operation of cotton gins. See Frost v. Corp. Comm'n of Okla., 278 U.S. at 517, 49 S.Ct. 235. To obtain a permit, a person needed to show a "public necessity." 278 U.S. at 517, 49 S.Ct. 235. When the city granted a corporation a permit without requiring it to show a public necessity, the plaintiff filed suit, alleging an Equal Protection Clause violation by arguing that there was a disparate treatment between individuals and corporations. See 278 U.S. at 518-19, 49 S.Ct. 235. The Supreme Court held that the Equal Protection Clause's purpose "is to rest the rights of all persons upon the same rule under similar circumstances." 278 U.S. at 522, 49 S.Ct. 235. It stated:
278 U.S. at 522, 49 S.Ct. 235 (citations omitted)(internal quotation marks omitted). The Supreme Court, thus, held that it was the arbitrary distinction between corporations and individuals that invalidated the permit application process. See 278 U.S. at 522, 49 S.Ct. 235.
That it was the arbitrariness of the distinction, and not the distinction itself, is highlighted by the Supreme Court's comparison between the two categories of Oklahoma corporations. In 1917, Oklahoma passed a statute providing that "co-operative agricultural or horticultural associations not having capital stock or being conducted for profit, may be formed for the purpose of mutual help by persons engaged in agriculture or horticulture." Frost v. Corp. Comm'n of Okla., 278 U.S. at 517-18, 49 S.Ct. 235. In 1919, Oklahoma passed a statute providing that for-profit corporations could be "formed for the purpose of conducting, among others, an agricultural or horticultural business upon a co-operative plan." 278 U.S. at 518, 49 S.Ct. 235. The 1919 statute provided the number of owners that a for-profit corporation must have, the price of its stock, the number of its shares, and the manner for distributing its profits. See 278 U.S. at 518, 49 S.Ct. 235. The Supreme Court opined that, if a distinction was made between corporations formed under the 1917 act and individuals in the permit application process, that distinction would likely be upheld. See 278 U.S. at 523-24, 49 S.Ct. 235 ("As applied to corporations organized under the 1917 act, we have no reason to doubt that the classification created by the proviso might properly be upheld."). The Supreme Court noted, however, that, because anyone could own a corporation established under the 1919 act, and because those corporations were created for the purpose of making money, the differences between an individual and a corporation under the 1919 act were "without substance" 278 U.S. at 524, 49 S.Ct. 235.
Frost v. Corp. Comm'n of Okla., 278 U.S. at 524-25, 49 S.Ct. 235.
As noted earlier, the differences between corporations and individuals in the hydrocarbon extraction arena are not arbitrary. Corporations engage in more hydrocarbon extraction activities than individuals. Additionally, corporations may be able to take steps to prevent total liability in ways that individuals cannot. Merely because Mora County decided to eliminate some hydrocarbon extraction activities, but not, all does not make the Ordinance's distinctions arbitrary. The Supreme
336 U.S. at 110, 69 S.Ct. 463. See S.W. Media Mobile, LLC v. City of Rio Rancho, No. CIV 13-0248 JB/KBM, 2013 WL 6920856, at *31 (D.N.M. Dec. 31, 2013) (Browning, J.)(concluding that city had rational basis for banning private mobile advertisements but not advertisements on city buses).
In the same way, the Defendants could have concluded that corporations were more likely to drill for oil and gas and to engage in fracking than individuals. That the Defendants did not ban all hydrocarbon extraction—by both corporations and individuals—does not violate the Equal Protection Clause. See Ry. Express Agency v. People of N.Y., 336 U.S. at 110, 69 S.Ct. 463. The Defendants may have decided to apply the Ordinance only to the most likely culprits of hydrocarbon extraction and fracking. The distinction between corporations and individuals is not arbitrary. Cf. Frost v. Corp. Comm'n of Okla., 278 U.S. at 522, 49 S.Ct. 235. Accordingly, the Ordinance's disparate treatment of corporations bears a rational relationship with a legitimate state interest.
SWEPI, LP argues that the Ordinance constitutes an unlawful animus against corporations. See Motion at 8-10. Normally, courts do not consider legislators' subjective intent in determining the constitutionality of a law. See Palmer v. Thompson, 403 U.S. 217, 224, 91 S.Ct. 1940, 29 L.Ed.2d 438 (1971) (discussing the "hazards of declaring a law unconstitutional because of the motivations of its sponsors"). In a line of cases, starting with United States Department of Agriculture v. Moreno, the Supreme Court has created
The first case to apply the animus doctrine was United States Department of Agriculture v. Moreno. See 413 U.S. at 528, 93 S.Ct. 2821. There, Congress passed a law providing that the distribution of food stamps should be determined on a household basis, and Congress defined household to include only groups of related individuals. See 413 U.S. at 529-30, 93 S.Ct. 2821. The Supreme Court found that the term "household" was limited to related individuals "to prevent socalled `hippies' and `hippie communes' from participating in the food stamp program." 413 U.S. at 535, 93 S.Ct. 2821. In invalidating the household classification, the Supreme Court held that,
413 U.S. at 534-35, 93 S.Ct. 2821.
The Supreme Court again addressed the animus doctrine in City of Cleburne v. Cleburne Living Center. See 473 U.S. at 432, 105 S.Ct. 3249. There, the city of Cleburne, Texas, refused to issue to a group home for mentally disabled individuals a special use permit, which was required to operate such a home. See 473 U.S. at 435, 105 S.Ct. 3249. The Supreme Court held that the mentally disabled are not a suspect or a quasi-suspect class that would require heightened standard of review. See 473 U.S. at 442-47, 105 S.Ct. 3249. Despite applying a rational basis review, the Supreme Court invalidated the zoning ordinance that required homes for the mentally disabled to obtain a special use permit, holding that the permit requirement appeared "to rest on an irrational prejudice against the mentally retarded." 473 U.S. at 450, 105 S.Ct. 3249.
In Romer v. Evans, the Supreme Court invalidated a Colorado law that repealed any ordinance or law prohibiting discrimination against homosexuals. See 517 U.S. at 620, 116 S.Ct. 1620. The Supreme Court held that, in "the ordinary case, a law will be sustained if it can be said to advance a legitimate government interest, even if the law seems unwise or works to the disadvantage of a particular group, or if the rationale for it seems tenuous," and that, "[b]y requiring that the classification
In United States v. Windsor, ___ U.S. ___, 133 S.Ct. 2675, 186 L.Ed.2d 808 (2013), the Supreme Court invalidated Section 3 of the Defense of Marriage Act, 110 Stat. 2419 ("DOMA"). 133 S.Ct. at 2682. Section 3 defined marriage as a legal union between one man and one woman. See 133 S.Ct. at 2683. The Supreme Court noted that, "[i]n determining whether a law is motived by an improper animus or purpose, discriminations of an unusual character especially require careful consideration." 133 S.Ct. at 2693 (citations omitted)(internal quotation marks omitted). The Supreme Court noted that DOMA's purpose was to "identify a subset of state-sanctioned marriages and make them unequal," in effect, treating lawful same-sex marriages as "second-class marriages." 133 S.Ct. at 2693-94.
In his concurring opinion in Bishop v. Smith, the Honorable Jerome A. Holmes, United States Circuit Judge for the Tenth Circuit, elucidated his interpretation of the animus doctrine. See 760 F.3d at 1096 (Holmes, J., concurring). There, the Tenth Circuit, in an opinion that Judge Lucero wrote, invalidated an Oklahoma law that prohibited issuing marriage licenses to same-sex couples. See 760 F.3d at 1074. Judge Lucero concluded that the Oklahoma law denied "a fundamental right to all same-sex couples who seek to marry or to have their marriages recognized." 760 F.3d at 1081. Neither the district court nor Judge Lucero decided the case on animus grounds. See 760 F.3d at 1096-96 (Holmes, J., concurring). Judge Lucero did not address the animus doctrine. See 760 F.3d at 1074-96. Judge Holmes wrote separately, but stated that he fully agreed with Judge Lucero's conclusion and reasoning, including the decision to not apply the animus doctrine. See 760 F.3d at 1096-97. Judge Holmes' concurring opinion focused on the contours of the animus doctrine and explained why it did not apply in that case. See 760 F.3d at 1097 (Holmes, J., concurring).
760 F.3d at 1103 (Holmes, J., concurring) (citations omitted).
Mora County did not enact the Ordinance based solely on an unlawful animus. While Judge Holmes' animus test may call for the Ordinance's invalidation, the Court is hesitant to apply the animus doctrine in a case such as this one. SWEPI, LP has not cited, and the Court has been unable to find, any cases invalidating a law because of an unlawful animus toward the corporate form. In fact, it appears that, outside United States Department of Agriculture v. Moreno and City of Cleburne v. Cleburne Living Center, the animus doctrine has been applied only in homosexual rights cases. The Court is hesitant to be the first to apply the doctrine in these circumstances. Moreover, the Tenth Circuit has previously indicated that the animus doctrine applies only after a court has determined that there is no conceivable purpose for passing a law other than an unlawful animus. See Powers v. Harris, 379 F.3d 1208, 1224 (10th Cir.2004). Mora County had a conceivable purpose for enacting
Under Judge Holmes' articulation of the animus doctrine, however, the Ordinance should be invalidated. Judge Holmes identified two structural aberrations for which a court should search in detecting an unlawful animus: (i) the law imposes a "wide-ranging and novel deprivations upon the disfavored group"; and (ii) the law strays "from the historical territory of the lawmaking sovereign just to eliminate privileges that a group would otherwise receive." Bishop v. Smith, 760 F.3d at 1100 (Holmes, J., concurring). Both structural aberrations are present here.
First, the Ordinance imposes "wide-ranging and novel deprivations upon [a] disfavored group": corporations. Bishop v. Smith, 760 F.3d at 1100 (Holmes, J., concurring). The Ordinance states that corporations may not engage in the extraction of hydrocarbons in Mora County. See Ordinance § 5.1, at 4. It states that corporations may not extract water from Mora County to be used for hydrocarbon extraction and that corporations may not import into Mora County any substance to be used for hydrocarbon extraction. See Ordinance § 5.2, at 4. The Ordinance provides that corporations, and those associated with corporations—directors, officers, owners, and managers—cannot store any byproducts from hydrocarbon extraction in Mora County, and that they cannot construct or maintain infrastructure in Mora County that is related to hydrocarbon extraction. See Ordinance §§ 5.3, 5.4, at 4. Finally, the Ordinance states that corporations in violation of, or seeking to violate, the Ordinance do not have rights under the First Amendment, the Fifth Amendment, the Commerce Clause, the Contract Clause, or similar rights under the New Mexico Constitution. See Ordinance § 5.5, at 4. The Ordinance thus deprives corporations of a wide range of rights.
Second, the Ordinance strays from the historical territory of county lawmaking just to deprive corporations of their rights. Regulating oil-and-gas production is not within the purview of traditional county powers. In New Mexico, oil-and-gas regulations have traditionally been left to the state and to the Oil and Gas Commission. See N.M. Att'y Gen. Op. 86-2, 1986 WL 220334 (opining that counties cannot regulate oil-and-gas production). Furthermore, the Ordinance states which federal laws apply and how federal laws are to apply. See Ordinance §§ 5.5-5.9, at 4-5. Historically, a county cannot enact or supersede federal law. The Ordinance thus goes beyond Mora County's historical lawmaking just to deprive corporations of their rights.
Also, on a more basic level, the animus toward corporations is evident. See Ordinance Introduction, at 1 ("We believe that industrial use of water supplies in this county placing the control of water in the hands of a corporate few, rather than the county would constitute abuse and usurpation; and that we are therefore duty bound to oppose such abuse and usurpation." (bold omitted)); id. at 1 ("An Ordinance protecting the right of human communities, nature, and natural water, . . . by eliminating legal privileges and powers from corporations violating the Ordinance." (bold omitted)(capitalization omitted)); id. § 4.5, at 3 ("[C]orporate entities and their directors and managers shall not enjoy special privileges or powers under the law which make community majorities subordinate to them."). Once animus is detected, at all, and here that animus
Before United States v. Windsor, The Tenth Circuit noted, that, in Romer v. Evans and City of Cleburne v. Cleburne Living Center, the Supreme Court may have found that, "after considering all other conceivable purposes," the only conceivable state interest was "a bare desire to harm a politically unpopular group." Powers v. Harris, 379 F.3d at 1224 (internal quotation marks omitted)(alterations omitted). If, however, a court can "conceive[ ] of a legitimate state interest other than a bare desire to harm" a politically unpopular group, the animus doctrine does not apply. Powers v. Harris, 379 F.3d at 1224 (internal quotation marks omitted). While the Tenth Circuit made these assertions before United States v. Windsor, United States v. Windsor should not change the rationale. Only Judge Holmes has interpreted United States v. Windsor as being based on an animus theory. The Tenth Circuit has interpreted United States v. Windsor in only two cases: Bishop v. Smith and Kitchen v. Herbert, 755 F.3d 1193 (10th Cir.2014). In Kitchen v. Herbert, the Tenth Circuit held, in an opinion that Judge Lucero wrote and Judge Holmes joined, that United States v. Windsor indicates that there is a fundamental right to marry. See 755 F.3d at 1213. In his dissenting opinion in Kitchen v. Herbert, the Honorable Paul J. Kelly, Jr., United States Circuit Judge for the Tenth Circuit, interpreted United States v. Windsor as recognizing that the states, and not the federal government, have the authority to define marriage. See 755 F.3d at 1235-36 (Kelly, J., dissenting). Accordingly, the three Tenth Circuit judges to consider United States v. Windsor have each interpreted it differently.
Additionally, the animus doctrine may only apply if the disadvantaged class "has a history of oppression and political powerlessness." Kitchen v. Herbert, 961 F.Supp.2d 1181, 1208 (D.Utah 2013) (Shelby, J.). In City of Cleburne v. Cleburne Living Center, the Supreme Court noted that the mentally disabled had been subject to a "history of unfair and often grotesque mistreatment." 473 U.S. at 438, 105 S.Ct. 3249 (internal quotation marks omitted). It may be argued that hippies, the mentally disabled, and homosexuals have been subject to a history of discrimination and oppression, but such a description cannot be said of corporations. For one, while corporations are persons for constitutional purposes, they still are not real human beings, deserving of respect and human dignity. Corporations are often the most powerful lobbyers in Washington, D.C., and in state capitals across the nation. Corporations are hardly politically powerless and have not suffered a history of oppression.
In light of the uncertain contours of the animus doctrine, the Court declines to be the first to apply it in such a novel situation. In Powers v. Harris, the Tenth Circuit declined to apply the animus doctrine, because the Supreme Court had not applied it in similar circumstances. See 379 F.3d at 1224 ("Regardless, the [Supreme] Court itself has never applied Cleburne-style rational-basis review to economic issues. Following the Court's lead, neither will we." (citations omitted)). Following the Tenth Circuit's lead, the Court declines to extend the animus doctrine in a manner that the Supreme Court has not yet indicated it should be applied.
The Ordinance violates SWEPI, LP's First Amendment Rights. The Court has already invalidated § 5.5 under the Supremacy Clause. Section 5.5 is doubly invalid, because it also violates the First Amendment. Section 5.5 provides:
Similarly, § 5.5 states that corporations that violate, or seek to violate, the Ordinance have no First Amendment Rights. See Ordinance § 5.5, at 4. "The [Supreme] Court has recognized that First Amendment protection extends to corporations." Citizens United v. Fed. Election Comm'n, 558 U.S. at 342, 130 S.Ct. 876. Section 5.5 purportedly strips them of these rights if they violate or seek to violate the Ordinance. "[N]o conceivable governmental interest would justify such an absolute prohibition of First Amendment rights. Bd. of Airport Comm'rs v. Jews for Jesus, Inc., 482 U.S. at 575, 107 S.Ct. 2568. Section 5.5 is substantially overly broad in its restriction on First Amendment rights. SWEPI, LP is currently exercising its First Amendment rights by filing suit to overturn the Ordinance—i.e. seeking to violate the Ordinance. According to Section 5.5, because of SWEPI, LP's exercise of its First Amendment rights, it no longer has First Amendment rights. Such a law is illogical and cannot stand. Section 5.5 is overly broad in its restriction of First Amendment rights, and, as such, must be invalidated.
The Ordinance violates state law and must be invalidated.
The Defendants cannot enforce zoning regulations on state lands. That is not to say that every county ordinance must contain an explicit exception stating that it does not apply on state lands. Rather, a county may not enforce its existing zoning ordinances to state lands. Here, the Ordinance does not state that it does not apply to state lands. Such a statement is unnecessary. The Defendants, however, have argued that it may be applied to state lands, because hydrocarbon extraction on state lands may affect adjoining properties. See Response at 18. Such an assertion is incorrect.
In City of Santa Fe v. Armijo, the Supreme Court of New Mexico held that the city of Santa Fe could not enforce a local zoning ordinance on the premises of the State Land Office Building. See 1981-NMSC-102, ¶ 1, 96 N.M. 663, 634 P.2d 685. The Supreme Court of New Mexico held that municipalities have only those powers which the State expressly confers on them and that the statute under which the City of Santa Fe, New Mexico enacted the ordinance, did not give "express power to apply zoning regulations to state land," and,
Two Court of Appeals of New Mexico Court cases have clarified that this doctrine from City of Santa Fe v. Armijo does not apply only to activity by the State on state land, but also applies to private conduct on state lands. In City of Albuquerque v. Jackson Brothers, Inc., 1991-NMCA-140, 113 N.M. 149, 823 P.2d 949, the New Mexico State Highway and Transportation Department condemned a strip of land along Interstate-25 within the city limits of Albuquerque, New Mexico, to create a right of way. See 1991-NMCA-140, ¶ 2, 113 N.M. 149, 823 P.2d 949. In settling its condemnation lawsuit with the owner of the land, the Transportation Department agreed to allow the owner to maintain a sign on the right of way. See 1991-NMCA-140, ¶ 2, 113 N.M. 149, 823 P.2d 949. The owner's sign was partially within the Transportation Department's right of way, and the sign was fifty-five feet tall, despite a City of Albuquerque, New Mexico, ordinance limiting signs to twenty-six feet in that area. See 1991-NMCA-140, ¶ 2, 113 N.M. 149, 823 P.2d 949. The Court of Appeals held that the City of Albuquerque could not regulate the portion of the sign that was within the Transportation Department's right of way but could regulate the portion of the sign that was on the owner's private property. See 1991-NMCA-140, ¶ 7, 113 N.M. 149, 823 P.2d 949.
In County of Santa Fe v. Milagro Wireless, LLC, a private company erected a cellular telephone tower on state land near Santa Fe. See 2001-NMCA-070, ¶ 2, 130 N.M. 771, 32 P.3d 214. The county of Santa Fe attempted to stop the construction of the tower, because it violated a county zoning ordinance. See 2001-NMCA-070, ¶ 2, 130 N.M. 771, 32 P.3d 214. Santa Fe County filed suit, requesting a declaratory action to prevent the construction of the tower, by arguing that, even if a county cannot generally enforce zoning ordinances on state land, that prohibition applies to state action and not private action by a commercial entity on state land. See 2001-NMCA-070, ¶¶ 2, 4, 130 N.M. 771, 32 P.3d 214. The Court of Appeals of New Mexico, in an opinion that Judge Bustamante wrote, and Judges Alarid and Castillo joined, held that "county zoning ordinances cannot override the state's authority to regulate the use of its own land, whether the activity taking place on state land is pursued by the state or by a private entity with the state's approval." 2001-NMCA-070, ¶ 5, 130 N.M. 771, 32 P.3d 214. The court concluded that the state statute granting counties and municipalities the general authority to enact zoning ordinances did not constitute an express delegation of authority for the county to enforce zoning ordinances on state land. See 2001-NMCA-070, ¶ 7, 130 N.M. 771, 32 P.3d 214 (citing N.M. Stat. Ann. § 3-21-1).
While the Court's task is to determine how the Supreme Court of New Mexico would decide the issues, the Court concludes
Here, the Defendants have not identified any state statute explicitly granting them the authority to enforce zoning regulations on state land. Instead, the Defendants argue that conduct on state lands may affect adjoining county lands; specifically, hydrocarbon extraction on state lands may affect the water on the adjoining land. See Tr. at 146:10-22 (Haas). The effect that conduct on state lands may have on adjoining lands is not a factor that New Mexico courts have considered. In City of Santa Fe v. Armijo, the Land Commissioner sought to place an oil field pumping rig on the premises of the State Land Office Building. See 1981-NMSC-102, ¶ 1, 96 N.M. 663, 634 P.2d 685. In addition to the City of Santa Fe, several private neighborhood associations also sought to prevent the Land Commissioner from placing the oil rig on the state land. See 1981-NMSC-102, ¶ 1, 96 N.M. 663, 634 P.2d 685. The existence of an oil field pumping rig would certainly affect the aesthetics of the surrounding neighborhoods. The Supreme Court of New Mexico did not, however, focus on the effect that the Land Commissioner's actions may have on the surrounding neighborhoods. It focused solely on the City of Santa Fe's statutory authority to enforce the ordinance on state land. See City of Santa Fe v. Armijo, 1981-NMSC-102, ¶ 5, 96 N.M. 663, 634 P.2d 685. Similarly, in City of Albuquerque v. Jackson Brothers, Inc., the Court of Appeals of New Mexico did not consider the effect that the sign's height may have on surrounding properties or on vehicular traffic on 1-25. And in County of Santa Fe v. Milagro Wireless, LLC, Judge Bustamante
The Defendants lack statutory authority to enforce the Ordinance on state lands. While the Defendants have general zoning authority, see N.M. Stat. Ann. § 3-21-1, this general authority is not an express grant of authority to enforce zoning ordinances on state lands, see County of Santa Fe v. Milagro Wireless, LLC, 2001-NMCA-070, ¶ 7, 130 N.M. 771, 32 P.3d 214. And despite the Ordinance going into effect on April 29, 2013, the New Mexico Legislature has not, by statute, validated or authorized the Ordinance. Without an express grant of authority, the Ordinance cannot be enforced on state lands.
Because the Ordinance cannot be enforced on state lands, the question is whether the Ordinance should be invalidated merely because it lacks a provision stating that it does not apply to state lands or whether the Court should enjoin the Defendants from enforcing the Ordinance on state lands. In City of Santa Fe v. Armijo, City of Albuquerque v. Jackson Brothers, Inc., and County of Santa Fe v. Milagro Wireless, LLC, the courts were considering challenges to conduct on state land, and not challenges to city or county ordinances. Thus, they provide little guidance. In the Complaint, SWEPI, LP requests "a declaration that the Ordinance violates New Mexico law because it seeks, without an express delegation of authority, to regulate lands owned by the States, as well as a permanent injunction prohibiting Defendants from enforcing the statute as written." Complaint ¶ 107, at 20. New Mexico law concerning the enforcement of county and municipal zoning ordinances on federal land is instructive. "A county or municipality may zone federally-owned lands, but may not enforce the adopted zoning ordinances on federal land absent consent from the United States." Bonito Land & Livestock, Inc. v. Valencia Cnty. Bd. of Comm'rs, 1998-NMCA-127, ¶ 8, 125 N.M. 638, 964 P.2d 199, 200. It is not the zoning of the state land that violates the state law, but the enforcement of the zoning ordinance that violates the state law. Similarly, it is not a violation of New Mexico law for the Ordinance to not provide an exception for state lands, but it would be a violation for the Defendants to enforce the Ordinance on state lands. Accordingly, invalidation of the Ordinance is not warranted; however, the Court will enjoin the Defendants from enforcing the Ordinance on state lands.
New Mexico state law impliedly preempts the Ordinance, because it conflicts with state law. State law may either expressly or impliedly preempt a county ordinance. See San Pedro Mining Corp. v. Bd. of Cnty. Comm'rs, 1996-NMCA-002, ¶ 9, 121 N.M. 194, 909 P.2d 754, 758. To expressly preempt local laws, the State "legislature must clearly state its intention to do so." Rancho Lobo, Ltd. v. Devargas, 303 F.3d at 1201. There are two doctrines under which state law may impliedly preempt a local law: (i) field preemption; and (ii) conflict preemption. See San Pedro Mining Corp. v. Bd. of Cnty. Comm'rs, 1996-NMCA-002, ¶ 11. 121 N.M. 194, 909 P.2d 754. Field preemption occurs when "it is evident from the language of the New Mexico law at issue that the legislature `clearly intended to preempt a governmental area.'" Rancho Lobo, Ltd. v. Devargas, 303 F.3d at 1204 (quoting Casuse v. City of Gallup, 1987-NMSC-112, ¶ 6, 106 N.M. 571, 746 P.2d 1103, 1105). Conflict preemption examines "whether the ordinance permits an act the general law prohibits, or prohibits an act the general law permits." Rancho Lobo, Ltd. v. Devargas, 303 F.3d at 1205 (citing Inc. Cnty. of Los Alamos v. Montoya, 1989-NMCA-004, ¶ 16, 108 N.M. 361, 772 P.2d 891 ("Rather, the tests are whether the stricter requirements of the ordinance conflict with state law, and whether the ordinance permits an act the general law prohibits, or prohibits an act the general law permits.")). Merely requiring greater restrictions than state law, however, does not necessarily make the ordinance invalid. See Inc. Cnty. of Los Alamos v. Montoya, 1989-NMCA-004, ¶ 16, 108 N.M. 361, 772 P.2d 891. SWEPI, LP argues that state law impliedly preempts the Ordinance through either field or conflict preemption. State law does not entirely preempt the oil-and-gas field. The Ordinance conflicts, however, with state law and is, thus, invalid because of conflict preemption.
New Mexico state law does not impliedly preempt the entire oil-and-gas field. SWEPI, LP directs the Court to a 1986 New Mexico Attorney General advisory letter in which the Attorney General opined that the entire field of oil-and-gas regulation was occupied by the State—i.e. the State of New Mexico impliedly preempted the entire oil-and-gas field. See Motion at 20 (citing N.M. Att'y Gen. Op. 86-2, 1986 WL 220334). However, "Attorney General opinions and advisory letters do not have the force of law." United States v. Reese, 2014-NMSC-013, ¶ 36, 326 P.3d 454, 462. Moreover, the advisory letter is almost thirty years old, and there has been intervening case law that indicates that field preemption does not apply.
N.M. Att'y Gen. Op. 86-2, 1986 WL 220334, at *2 (quoting N.M. Stat. Ann. § 70-2-36)(emphasis in N.M. Att'y Gen. Op. 86-2 but not in source). Based on this statute, Ms. Stephenson concluded that the Oil Conservation Division, "therefore, occupies the entire area of oil and gas regulation and a county cannot, by ordinance, attempt to regulate this area." N.M. Att'y Gen. Op. 86-2, 1986 WL 220334, at *2. The Attorney General discussed cases from Washington, Missouri, and Alaska in which the courts found that the state law preempted the areas of prison construction, location of intercity electric transmission lines, subdivisions, and mobile home construction standards. See N.M. Att'y Gen. Op. 86-2, 1986 WL 220334, at *2 (citing Snohomish Cnty. v. State of Washington, 97 Wn.2d 646, 648 P.2d 430 (1982) (en banc) (prison location); Union Elec. Co. v. City of Crestwood, 562 S.W.2d 344 (Mo.1978) (en banc) (location of intercity electric transmission lines); Kenai Peninsula Borough v. Kenai Peninsula Bd. of Realtors, Inc., 652 P.2d 471 (Alaska 1982) (subdivisions); Snohomish Cnty. v. Thompson, 19 Wn.App. 768, 577 P.2d 627 (1978)). Additionally, Ms. Stephenson opined that the county ordinance was further invalid, because it "applies requirements to oil and gas production beyond those imposed by OCD and thus prohibits, that which OCD permits." N.M. Att'y Gen. Op. 86-2, 1986 WL 220334, at *3. Finally, Ms. Stephenson concluded that "[c]oncurrent jurisdiction does not appear possible." N.M. Att'y Gen. Op. 86-2, 1986 WL 220334, at *3.
Since the Attorney General's Office issued the advisory letter, New Mexico
1996-NMCA-002, ¶ 12, 121 N.M. 194, 909 P.2d 754. The Court of Appeals of New Mexico concluded that, "[t]herefore, there is room for concurrent jurisdiction and regulation, with the County's ordinance regulating aspects of the mining activity that concern off-site safety, compatibility with surrounding property uses, and other matters left unaddressed by the Act and regulations." 1996-NMCA-002, ¶ 12, 121 N.M. 194, 909 P.2d 754. Because there was room for concurrent regulation between a county and the Mining Act, the Court of Appeals of New Mexico held that the Mining Act and subsequent regulations do not completely preempt the mining field. See 1996-NMCA-002, ¶ 14, 121 N.M. 194, 909 P.2d 754. The Court of Appeals of New Mexico noted that portions of Santa Fe County's ordinance may conflict with the Mining Act, and thus be preempted under conflict preemption, but, because the plaintiff argued only that the ordinance, as a whole, was preempted, the court did not consider which individual provisions might be preempted through conflict preemption. See 1996-NMCA-002, ¶ 13, 121 N.M. 194, 909 P.2d 754.
In Rancho Lobo, Ltd. v. Devargas, the Tenth Circuit considered whether the New Mexico Forest Conservation Act, N.M. Stat. Ann. §§ 68-2-1 through 68-2-34, preempted a New Mexico county's "Timber Harvest Ordinance." See 303 F.3d at 1197. The Tenth Circuit, in an opinion that the Honorable Mary B. Briscoe, United States Circuit Judge for the Tenth Circuit, authored, and Judges Ebel and McKay joined, held that the Conservation Act did not preempt the ordinance. See 303 F.3d at 1207. The Tenth Circuit noted that there was some support for the argument that the Conservation Act impliedly preempted the entire field; specifically, the Conservation Act created the Forestry Division and granted it with sweeping powers to make rules and regulations concerning timber harvests, and the Forestry Division's regulations were comprehensive. See 303 F.3d at 1204. The Tenth Circuit concluded, however, that the Conservation Act was "very similar" to the Mining Act in San Pedro Mining Corp. v. Board of County Commissioners. 303 F.3d at 1204. Both acts, it noted, "did not really address the kinds of development issues `with which local governments are traditionally concerned.'" 303 F.3d at 1204 (quoting
Rancho Lobo, Ltd. v. Devargas, 303 F.3d at 1204-05. The Tenth Circuit concluded that, because the Conservation Act "left room for concurrent jurisdiction over local forestry issues," the Conservation Act does not impliedly preempt "the entire field of regulation relating to timber harvesting in New Mexico." 303 F.3d at 1205. As for conflict preemption, the plaintiff argued, and the district court concluded, that, because the Conservation Act permits clear cutting
The Oil and Gas Act is focused primarily on the prevention of waste and the drilling and maintenance of oil-and-gas wells. The Oil and Gas Act prohibits the production or handling of oil and gas in a manner that constitutes or results in waste. See N.M. Stat. Ann. § 70-2-2. Waste is interpreted with its ordinary meaning, and the Oil and Gas Act also provides a number of specific examples that can be summed up as the inefficient, excessive, or improper use of oil and gas. See N.M. Stat. Ann. § 70-2-3. The Oil and Gas Act provides the Oil Conservation Division with a number of powers concerning the regulation of drilling for, and producing, oil and gas. See N.M. Stat. Ann. § 70-2-12. The Oil and Gas Act, however, does not address "the kinds of . . . issues `with which local governments are traditionally concerned.'" Rancho Lobo, Ltd. v. Devargas, 303 F.3d at 1204 (quoting San Pedro Mining Corp. v. Bd. of Cnty. Comm'rs, 1996-NMCA-002, ¶ 12, 121 N.M. 194, 909 P.2d 754). The Oil and Gas Act does not address issues such as traffic that oil-and-gas production creates; noise limitations for production near residential areas; potential nuisance issues from sound, dust, or chemical run-off; or the impact of oil-and-gas production on neighboring properties.
In the 1986 advisory letter, Assistant Attorney General Stephenson focused on the Oil Conservation Division's authority and jurisdiction in concluding that the Oil and Gas Act preempted the entire oil-and-gas field. See N.M. Att'y Gen. Op. 86-2, 1986 WL 220334, at *2. That the Legislature has authorized the Oil Conservation Commission to pass regulations and has passed extensive regulations does not change the conclusion that there is no field preemption. Both the Mining Act and the Conservation Act created state agencies with the authority to enact extensive regulations. See N.M. Stat. Ann. § 69-36-6 (creating the Mining Commission); N.M. Stat. Ann. § 69-36-7 (providing the Mining Commission with authority to enact regulations); N.M. Stat. Ann. § 68-2-16 (noting that the Forestry Division has the authority to enforce and enact rules and regulations). The existence of a state agency with regulatory authority, however, did not lead the Tenth Circuit or the Court of Appeals of New Mexico to conclude that the Mining Act or the Conservation Act preempted their respective fields. See Rancho Lobo, Ltd. v. Devargas, 303 F.3d at 1204-05; San Pedro Mining Corp. v. Bd. of Cnty. Comm'rs, 1996-NMCA-002, ¶ 12, 121 N.M. 194, 909 P.2d 754. Similarly, the existence of the Oil Conservation Division, and its abilities to enact and enforce regulations, does not cause the Oil and Gas Act to preempt the entire oil-and-gas field. Instead, the correct question to ask is whether the Oil and Gas Act left room for concurrent jurisdiction with local governments. See Rancho Lobo, Ltd. v. Devargas, 303 F.3d at 1205. To answer this question, the Court must examine whether the Oil and Gas Act addresses the issues with which local governments are traditionally concerned.
The Ordinance conflicts with New Mexico state law and must be invalidated. The Supreme Court of New Mexico first articulated the conflict preemption test in State ex rel. Coffin v. McCall, 1954-NMSC-076, 58 N.M. 534, 273 P.2d 642, where it stated that "the test is whether the ordinance permits an act the general law prohibits, or vice versa." 1954-NMSC-076, ¶ 9, 58 N.M. 534, 273 P.2d 642. "[G]eneral law" means "a law that applies generally throughout the state, or is of statewide concern as contrasted to local or municipal law." Apodaca v. Wilson, 1974-NMSC-071, ¶ 16, 86 N.M. 516, 525 P.2d 876, 881. The Supreme Court of New Mexico later clarified that "`an ordinance will conflict with state law when state law specifically allows certain activities or is of such a character that local prohibitions on those activities would be inconsistent with or antagonistic to that state law or policy.'" Stennis v. City of Santa Fe, 2008-NMSC-008, ¶ 21, 326, 143 N.M. 320, 176 P.3d 309, 315 (quoting New Mexicans for Free Enter. v. City of Santa Fe, 2006-NMCA-007, ¶ 43, 138 N.M. 785, 126 P.3d 1149, 1166). If a county or municipal law conflicts with state law, it must be invalidated. See Bd. of Comm'rs of Rio Arriba Cnty. v. Greacen, 2000-NMSC-016, ¶ 17, 129 N.M. 177, 3 P.3d 672 (invalidating provisions of county ordinance that conflicted with state law). However, "an ordinance is not necessarily invalid because it provides for greater restrictions than state law." Rancho Lobo, Ltd. v. Devargas, 303 F.3d at 1205.
By banning hydrocarbon exploration-and-extraction activities, the Ordinance is antagonistic to state law, because it prohibits activities that New Mexico state law permits. New Mexico courts have generally applied the conflict preemption doctrine when local laws permit conduct that state law prohibits. For example, in Board of Commissioners of Rio Arriba County v. Greacen, the Supreme Court of New Mexico held that a county ordinance, which imposed penalties for driving under the influence ("DUI") that were more severe than penalties that a state statute expressly limited, conflicted with state law. 2000-NMSC-016, ¶ 18, 129 N.M. 177, 3 P.3d 672. Additionally, in Protection and Advocacy System v. City of Albuquerque, 2008-NMCA-149, 145 N.M. 156, 195 P.3d 1, the Court of Appeals of New Mexico held that a city ordinance, which permitted a court to order an individual to take medication, conflicted with a state law that prohibited forced medications. See 2008-NMCA-149, ¶¶ 58-59, 145 N.M. 156, 195 P.3d 1.
The Court has been unable to find, and the parties have not cited, any case in which a New Mexico court found conflict preemption based on a local ordinance prohibiting conduct that state law permits. The Court, however, has been unable to find a New Mexico case in which a court considered an ordinance as extreme as this
State law is not silent on the exploration and extraction of hydrocarbons. The State has created an extensive statutory and regulatory scheme to regulate oil-and-gas production. See generally N.M. Stat. Ann. § 70-2-1. By extensively regulating oil-and-gas production in a manner that is intended to prevent waste, see N.M. Stat. Ann. § 70-2-2, the State has indicated that oil-and-gas extraction is permitted. This focus on preventing waste also highlights the Oil and Gas Act's focus on the efficient production of oil and gas. Furthermore, if state law did not permit oil-and-gas production, the State would not so heavily regulate oil-and-gas production. A complete ban on oil-and-gas extraction would be "antagonistic" to state law.
At the hearing, in addressing SWEPI, LP's argument that state law preempts the entire oil-and-gas field and that a county cannot regulate oil-and-gas activities, the Defendants argued that the Ordinance does not regulate oil-and-gas extraction, because it bans all such activities. See Tr. at 145:9-19 (Haas, Court). In the field preemption context, a ban rather than a regulation would be a distinction without a difference, because a county could not legislate in that field regardless how the legislation is characterized. For conflict preemption, however, the distinction makes a difference, and it is a difference that hurts the Defendants' position. If the Defendants had merely regulated oil-and-gas production in Mora County, those regulations may not conflict with state law, even if they were stricter than state law. See Rancho Lobo, Ltd. v. Devargas, 303 F.3d at 1205 (noting that an ordinance may provide for greater restrictions than state law). As long as the regulations did not prohibit conduct that state law permits or permit conduct that state law prohibits, the regulations would likely be upheld. The Defendants decided, however, to ban all hydrocarbon extraction activities rather than enacting specific regulations. Because the Oil and Gas Act permits oil-and-gas production, such a ban conflicts with state law by prohibiting conduct that state law permits.
Ritchie, supra at 310-11 (footnotes omitted). Accordingly, the Ordinance's ban conflicts with state law.
Because certain provisions in the Ordinance conflict with state law, they must be invalidated. See Bd. of Comm'rs of Rio Arriba Cnty. v. Greacen, 2000-NMSC-016, ¶ 17, 129 N.M. 177, 3 P.3d 672 (invalidating provisions of county ordinance that conflicted with state law). These provisions include Sections 5.1, 5.2, 5.3, 5.4, and 8.5. These provisions provide:
Ordinance §§ 5.1-5.4, at 4; id. § 8.5, at 6.
Section 5.1 bans corporations from engaging in hydrocarbon extraction. As the Court has previously noted, and as the Defendants argued, see Response at 19, corporations are likely the only entities engaged in hydrocarbon extraction. Individuals do not engage in oil-and-gas production without some form of limited liability protection. By banning all corporations from engaging in hydrocarbon extraction, and by defining the term corporation broadly, see Ordinance § 3.1, at 2, the Ordinance effectively bans all oil-and-gas production. This conflicts with state law, and § 5.1 must be invalidated.
Sections 5.2, 5.3, and 5.4 are all invalid for the same reasons: they effectively ban all oil-and-gas production in Mora County. While they do not explicitly ban hydrocarbon extraction activities—like § 5.1 does—they have the same effect of prohibiting all oil-and-gas production in Mora County. Section 5.2 prohibits corporations and individuals associated with corporations from possessing materials used in hydrocarbon extraction. See Ordinance § 5.2, at 4. Section 5.3 prohibits corporations from possessing any chemicals used in hydrocarbon extraction. See Ordinance § 5.3, at 4. And section 5.4 prohibits corporations from constructing the necessary infrastructures for hydrocarbon extraction. See Ordinance § 5.3, at 4. Each section is an effective ban on all oil-and-gas production. No one can produce oil and gas without the necessary materials, chemicals, or infrastructure. By prohibiting these things,
Section 8.5 is invalid, because it threatens to ban all hydrocarbon extraction activities. See Ordinance § 8.5, at 6. Section 8.5 states that, if the Ordinance is overturned or nullified, then there will be a moratorium on oil-and-gas extraction in Mora County, and that, during the moratorium, the County Commissioners will adopt another ordinance permanently banning hydrocarbon extraction. See Ordinance § 8.5, at 6. In this Memorandum Opinion and Order, the Court is invalidating the Ordinance. According to § 8.5, once the Court invalidates the Ordinance, hydrocarbon extraction will be banned in Mora County. See Ordinance § 8.5, at 6. Because a ban on all oil-and-gas production conflicts with state law, § 8.5's moratorium, which will take effect once the Court issues this Memorandum Opinion and Order, conflicts with state law. Accordingly, § 8.5 is invalidated as well.
In sum, §§ 5.1, 5.2, 5.3, 5.4, and 8.5 are invalid, because they conflict with state law.
The Ordinance is not severable and must be invalidated in its entirety. The Court has invalidated a number of the Ordinance's provisions. The Court must now proceed to determine whether those provisions of the Ordinance are severable from the remainder of the Ordinance, such that these portions of the Ordinance that are not unlawful may remain in force. "To determine whether invalid portions of [an] ordinance[ ] are severable, the court must refer to state law." Bd. of Cnty. Comm'rs v. QWest Corp., 169 F.Supp.2d 1243, 1250 (D.N.M.2001) (Conway, J.)(citing Leavitt v. Jane L. 518 U.S. 137, 139, 116 S.Ct. 2068, 135 L.Ed.2d 443 (1996)). New Mexico law provides:
Chapman v. Luna, 1984-NMSC-029, ¶ 30, 101 N.M. 59, 678 P.2d 687 (quoting Schwartz v. Town of Gallup, 1917-NMSC-021, ¶ 19, 22 N.M. 521, 165 P. 345 349). The existence of a severability clause is "not an inexorable command" that an ordinance is not severable, but it "does raise this presumption." Barber's Super Mkts., Inc. v. City of Grants, 1969-NMSC-115, ¶ 14, 80 N.M. 533, 458 P.2d 785, 788. If the "valid portions are inextricably intertwined with the invalid portions" so that they cannot be separated "without substantially affecting the ordinance," then the entire ordinance must be invalidated. City of Albuquerque v. Cauwels & Davis, Mgmt. Co., 1981-NMSC-077, ¶ 10, 96 N.M. 494, 632 P.2d 729, 731. Here, the Ordinance's valid portions are so intertwined with the invalid portions that the purpose of the valid portions cannot be accomplished, such that the Defendants would not have enacted the Ordinance without the invalid portions.
Ordinance § 13, at 6. The Court has invalidated §§ 5.1, 5.2, 5.3, 5.4, 5.5, 5.6, 5.8, 5.9, and 8.5. The remaining Ordinance, in its entirety, provides:
Ordinance § 1.1-14, at 1-6 (invalid provisions omitted).
The Court has effectively invalidated all of Section 5. Without these provisions, the
Without § 5's prohibitions, which the Court invalidated, the remaining Ordinance is an empty shell. There is no enforcement power. The remaining provisions provide support for § 5's prohibitions, state lofty ideals that have no force of law, or provide for the manner in which Mora County's government should act when certain issues arise regarding the Ordinance. The only remaining provisions that have a semblance of legal enforcement are §§ 6 and 7—the strict liability and future lost profits provisions. As the Court has noted, however, the validity of these two provisions is suspect. The Court cannot say that the Defendants would have enacted the Ordinance without § 5's prohibitions. The entire Ordinance revolves around § 5. The Ordinance repeatedly discusses the importance of water and the need to protect it. See Ordinance Introduction, at 1 ("[W]e have the duty to safeguard the water both on and beneath the Earth's surface...." (bold omitted)); id. § 1.2, at 2 ("The People of Mora County recognize that water is essential for the life, prosperity, sustainability, and health of their community and that damage to natural groundwater and surface water sources imposes great tangible loss...."); id. § 2, at 2 ("Water is the lifeblood of Mora County's traditions, culture and land use. A sustainable future for Mora County requires protection of the most valuable resource for our communities—the Water!" (internal quotation marks omitted)); id. § 4.1, at 3 ("All residents, natural communities and ecosystems in Mora County possess a fundamental and inalienable right to sustainably access, use, consume, and preserve water...."); id. § 4.4, at 3 ("All residents ... possess a right to a sustainable energy future, ... and the right to have an energy system based on fuel sources other than fossil fuel sources."). The Ordinance also focuses on subverting corporate rights. See Ordinance Introduction, at 1 ("We believe that industrial use of water supplies in this county placing the control of water in the hands of a corporate few, rather than the county would constitute abuse and usurpation; and that we are therefore duty bound to oppose such abuse and usurpation." (bold omitted)); id. Introduction at 1 ("An Ordinance protecting the right of human communities, nature, and natural water,... by eliminating legal privileges and powers from corporations violating the Ordinance." (bold omitted)(capitalization omitted)); id. § 4.5, at 3 ("[C]orporate entities and their directors and managers shall not enjoy special privileges or powers under the law which make community majorities subordinate to them."). The provisions that furthered each of these purposes have been invalidated. The hydrocarbon extraction bans protected water, and the stripping corporations of their rights corrected the perceived wrongs that corporate rights create. These provisions, however, have been invalidated. The Ordinances' purpose can no longer be given force and effect.
After the invalid provisions have been removed, the remaining portions no longer have "force and effect"; their legislative
Hydraulic Fracturing, Wikipedia.org, http:// en.wikipedia.org/wiki/Hydraulic_fracturing# Method (last visited Jan. 17, 2015).
Treaty of Guadalupe Hidalgo, Wikipedia.org, http://en.wikipedia.org/wiki/Treaty_of_Guadalupe_Hidalgo (last visited Jan. 17, 2015).
Glossary, Prodigy Oil and Gas, http://www. prodigyoilandgas.com/oil-and-gas-glossary. html (last visited Jan. 17, 2015).
Doe v. City of Albuquerque, 667 F.3d 1111, 1125-26, 1127 (10th Cir.2012) (emphasis in original)(referring to Ward v. Rock Against Racism, 491 U.S. 781, 109 S.Ct. 2746, 105 L.Ed.2d 661 (1989), which held that, even in a public forum, the government may impose reasonable restrictions on the time, place, or manner of protected speech, as long as the restrictions are narrowly tailored to serve a significant governmental interest, the restrictions leave open ample alternative channels for communicating the information, and the restrictions are justified without reference to the content of the regulated speech). See Richard H. Fallon, Jr., Fact and Fiction About Facial Challenges, 99 Cal. L.Rev. 915, 936-49 (2011)(examining empirical evidence and concluding that the Supreme Court regularly facially invalidates laws, and ignores the purported standard when it does); Richard H. Fallon, Jr., As-Applied and Facial Challenges and Third-Party Standing, 113 Harv. L.Rev. 1321, 1322-23, 1342-43 (2000); Michael C. Dorf, Facial Challenges to State and Federal Statutes, 46 Stan. L. Rev 235, 239-42 (1994) ("[T]he Salerno opinion cites no direct authority to support its truly draconian standard."). If the standard in United States v. Salerno were taken seriously, virtually no statute would ever be invalidated. A statute criminalizing male-male sexual relations would be constitutional, because it could validly be applied to nonconsensual male-male sexual relations. See Lawrence v. Texas, 539 U.S. 558, 123 S.Ct. 2472, 156 L.Ed.2d 508 (2003) (striking down a male-male sodomy law without ever using the term "facial challenge" or reciting any recognizable standard of the same). It is not clear how this standard even could be applied to Equal Protection challenges, invidious purpose challenges, procedural rights challenges, or challenges that a law falls outside of the federal government's enumerated powers; how it can be squared with void-for-vagueness doctrine; or whether and how it affects severability analysis. See Citizens United v. Fed. Election Comm'n, 558 U.S. at 331, 130 S.Ct. 876 ("[T]he distinction between facial and as-applied challenges is not so well defined that it has some automatic effect or that it must always control the pleadings and disposition in every case involving a constitutional challenge.").
United States v. Austin, 426 F.3d 1266, 1274 (10th Cir.2005) (citations omitted). The Court finds that Muller v. Culbertson and Douglas v. Norton, 167 Fed.Appx. 698 (10th Cir.2006) (unpublished), have persuasive value with respect to material issues, and will assist the Court in its preparation of this Memorandum Opinion and Order.
N.M. Stat. Ann.1953 § 22-9-22 (1975 Supp.).
Hale v. Henkel, 201 U.S. at 78-79, 26 S.Ct. 370 (Harlan, J., concurring). Some may find it odd that certain types of property are afforded constitutional rights while unborn humans are not, compare Minneapolis & St. Louis Ry. Co. v. Beckwith, 129 U.S. at 29, 9 S.Ct. 207 (recognizing that corporations have constitutional rights), with Roe v. Wade, 410 U.S. 113, 158, 93 S.Ct. 705, 35 L.Ed.2d 147 (1973) (holding that the unborn do not have Fourteenth Amendment rights), but Supreme Court has well established these principles, and the Court is bound to follow them. Justice Scalia, in addressing a dissenting opinion written by the Honorable John Paul Stevens, Associate Justice to the Supreme Court, however, provides historical support for granting corporations First Amendment rights. See Citizens United v. Fed. Election Comm'n, 558 U.S. at 385, 130 S.Ct. 876 (Scalia, J., concurring).
Citizens United v. Fed. Election Comm'n, 558 U.S. at 388-93, 130 S.Ct. 876 (Scalia, J., concurring)(alterations omitted)(footnotes omitted) (citations omitted).
Michael W. McConnell, 2013 Supreme Court Roundup: Telling a Tale of Two Courts, Firstthings.com (October 2013), http://www. firstthings.com/article/2013/10/2013-supreme-court-roundup.
Dale Carpenter, supra at 184-85. The Honorable Antonin G. Scalia, Associate Justice of the Supreme Court, has argued that that animus doctrine allows courts to invalidate laws without addressing the justifications for those laws. See United States v. Windsor, 133 S.Ct. at 2707-08.
United States v. Windsor, 133 S.Ct. at 2707-08 (citations omitted)(alterations omitted)(emphasis in original). The Court shares these concerns about the unprincipled application of the animus doctrine and its departure from the Court's usual jurisprudence that it does not delve into the subjective intentions of a legislature—if that is something a court can even judiciously do. In any case, the Court is not inclined to extend this problematic doctrine without more explicit directive from a majority of the Tenth Circuit or from the Supreme Court itself.
In Moor v. Alameda County, the Supreme Court held that, while a state and state agencies are not citizens of the state for diversity purposes, a county may be a citizen of a state for diversity purposes. See 411 U.S. at 718-20, 93 S.Ct. 1785. There, the Supreme Court noted that California counties had sufficient independent status that they are not mere agents of the state of California. See 411 U.S. at 718-20, 93 S.Ct. 1785. The Supreme Court noted that California counties are given corporate powers, can sue and be sued, are deemed local public entities, are liable for all judgments against them, are authorized to levy taxes, can sell and hold property, can contract for the construction and repair of structures, can provide public services, and are empowered to issue general obligation bonds. See 411 U.S. at 718-20, 93 S.Ct. 1785. In the same way, New Mexico counties are granted "those powers necessary and proper to provide for the safety, preserve the health, promote the prosperity and improve the morals, order, comfort and convenience" of their residents. N.M. Stat. Ann. § 4-37-1. In addition to a number of other powers, New Mexico counties can sue and be sued. See N.M. Stat. Ann. § 4-46-1. They can levy taxes. See N.M. Stat. Ann. § 4-38-17. Bernalillo County recently moved to increase its taxes. See Dan McKay, County Commissioners Agree to Tax Increase, Albuquerque J. (Jan. 14, 2015, 2:28 p.m.), http://www.abqjournal. com/525733/news/bernalillo-county-moves-forward-with-tax-increases.html. They can issue general revenue bonds. See N.M. Stat. Ann. § 4-62-1. If a county disapproves a person's monetary claim against the county, the person can appeal the decision to a New Mexico district court, rather than appealing to the State. See N.M. Stat. Ann. § 4-45-5. New Mexico counties can own property. See N.M. Stat. Ann. § 4-36-4. Furthermore, New Mexico counties do not hold Eleventh Amendment immunity. See Noland v. City of Albuquerque, No. CIV 08-0056 JB/LFG, 2009 WL 1292094, at *7 ("The County Defendants do not enjoy Eleventh Amendment immunity." (citing Lake Country Estates, Inc. v. Tahoe Reg'l Planning Agency, 440 U.S. 391, 401, 99 S.Ct. 1171, 59 L.Ed.2d 401 (1979))). It thus appears that, under Moor v. Alameda County, New Mexico counties are not agents of the State. See 411 U.S. at 718-20, 93 S.Ct. 1785. Consequently, New Mexico counties are citizens of New Mexico for diversity purposes. See Moor v. Alameda Cnty., 411 U.S. at 721-22, 93 S.Ct. 1785. See also OneBeacon Am. Ins. v. San Juan Cnty., No. CIV 11-0991 JB/ACT, 2013 WL 5934351 (D.N.M. Oct. 4, 2013) (Browning, J.)(finding no diversity jurisdiction between New Mexico corporation and New Mexico county). SWEPI, LP is a Delaware Limited Partnership with its principal place of business in Texas. See Complaint ¶ 3, at 2. Each of the Defendants is a citizen of New Mexico. See Complaint ¶¶ 8-12, at 3-4. If SWEPI, LP were a corporation, the Court would have diversity jurisdiction over SWEPI, LP's claims. See San Juan Basin Royalty Trust v. Burlington Res. Oil & Gas Co., 588 F.Supp.2d 1274, 1275 (D.N.M.2008) (Browning, J.)(noting that a corporation is citizen of the state of incorporation and the state in which it has its principle place of business). As a limited partnership, however, SWEPI, LP is a citizen of every state in which its partners are citizens. See San Juan Basin Royalty Trust v. Burlington Res. Oil & Gas Co., 588 F.Supp.2d at 1276. Because the Court does not have sufficient information to determine the citizenship of each of SWEPI, LP's partners, the Court cannot say whether it has diversity jurisdiction over SWEPI, LP's state-law claims. In any case, because federal claims remain, the Court will exercise supplemental jurisdiction over SWEPI, LP's state-law claims.
483 F.3d at 665-66 (citations omitted)(internal quotation marks omitted).
Jonas Armstrong, What the Frack Can We Do? Suggestions for Local Regulation of Hydraulic Fracturing in New Mexico, 53 Nat. Resources J. 357, 369 (2013)(concluding that the oil-and-gas field is not completely preempted by state law, but noting that a complete ban on fracking may not be upheld).
N.M. Stat. Ann. § 70-2-6. Ms. Stephenson focused on the language that says the Oil and Gas Division has "jurisdiction and authority over all matters," and over "all persons, matters or things necessary or proper to enforce effectively the provisions of this act." N.M. Att'y Gen. Op. 86-2, 1986 WL 220334, at *2 (quoting N.M. Stat. Ann. § 70-2-6)(emphasis omitted). The rest of the statutory provision, however, indicates that there is no field preemption. The statute states that the Oil Conservation Division has jurisdiction and authority over "matters relating to the conservation of oil and gas and the prevention of potash as a result of oil and gas operations." N.M. Stat. Ann. § 70-2-6. This provision, thus, bolsters the argument that the Oil and Gas Act is focused on the prevention of waste and conservation of oil and gas, and not on matters in which local governments are traditionally concerned. See Rancho Lobo, Ltd. v. Devargas, 303 F.3d at 1204.
Harlow v. Fibron Corp., 1983-NMCA-117, ¶ 19, 100 N.M. 379, 671 P.2d 40, 44 (quoting Hill v. Dearmin, 44 Colo.App. 123, 609 P.2d 127, 128 (1980)). Because SWEPI, LP has not challenged this provision, the Court will not separately invalidate it, but will invalidate it along with the entire Ordinance, because the invalid portions are not severable from the valid ones.
