OPINION
Now pending before the court is defendant’s motion for joinder or, in the alternative, to dismiss, which has been fully briefed and is ripe for a decision by the court. Because plaintiffs are not precluded from pursuing a takings claim under the Fifth Amendment and a breach of contract claim in the same suit, defendant’s motion to dismiss Count II of plaintiffs’ complaint pursuant to Rule 12(b)(6) of the Rules of the United States Court of Federal Claims (RCFC) is denied. Furthermore, because Champion Exploration, LLC (Champion) is now a party to this suit, defendant’s motion for joinder is denied as moot.
BACKGROUND
I. Factual Background
The United States, acting through the Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE) within the Department of the Interior (DOI), is the defendant in this ease. BOEMRE' is charged with managing the nation’s energy resources, including resources under the submerged lands of the Outer Continental Shelf (OCS) in the Gulf of Mexico and in other United States waters. BOEMRE is responsible for the administration of mineral leases on the OCS, as well as the regulation of mineral exploration and production activities on the OCS. BOEMRE was formerly the Minerals Management Service (MMS).
On July 8, 2008, plaintiffs entered into an oil-and-gas lease for 5760 acres of submerged land on the OCS in the Gulf of Mexico pursuant to the Outer Continental Shelf Lands Act
Plaintiffs paid the government $23,236,314 to acquire the lease, plus additional lease rental payments of $9.50 per acre, per lease year, for a total of $164,160 in rental payments from August 1, 2008 through January 25, 2011. Under the lease, the government was also entitled to a specified percentage of the estimated or market value of the oil and gas produced on the leased area as royalty payments, subject to a minimum royalty payment of $9.50 per acre, per lease year.
On December 22, 2008, plaintiffs submitted their Initial Exploration Plan (IEP) for the lease to MMS. See Compl. Ex. B. The IEP contemplated the drilling and completion of five separate wells (Wells 1 through 5) on the leased area. In accordance with the Coastal Zone Management Act of 1972, as amended, 16 U.S.C. §§ 1451-1464 (2006), plaintiffs submitted their IEP to the State of Louisiana, which approved the IEP on January 29,2009, through the Department of Natural Resources, Office of Coastal Restoration and Management. See Compl. Ex. C. MMS then approved the IEP on February 6, 2009. See Compl. Ex. D.
Plaintiffs conducted a reservoir analysis of the leased area, which indicated “proved reserves” of approximately 12.7 million barrels of oil equivalent (BOE) and “probable reserves” of approximately 2.4 million BOE.
On April 20, 2010, an explosion occurred on the Deepwater Horizon drilling vessel in the Gulf of Mexico during the completion of an exploratory well. The explosion killed eleven workers, and the subsequent loss of the vessel resulted in an oil spill that lasted several months and released a substantial quantity of crude oil into the Gulf of Mexico. Def.’s Mot. at 2.
On May 27, 2010, DOI issued a report (the Safety Measures Report) on the Deepwater Horizon oil spill, which recommended implementation of a six-month moratorium on permits for the drilling of new deepwater wells on the OCS. The next day, DOI issued a memorandum to MMS suspending all deep-water drilling operations in the Gulf of Mexico, whether pending, current, or approved. On May 30, 2010, in Notice to Lessees No. 2010-N04 (NTL4), MMS notified oil-and-gas lessees, including plaintiffs, of the six-month moratorium.
In the summer and fall of 2010, MMS— and then BOEMRE — imposed a number of substantial new regulations and requirements on deepwater drilling operations on the OCS in the Gulf of Mexico. Plaintiffs allege that these requirements have substantially increased the economic costs of their performance under the lease.
On June 8, 2010, MMS issued Notice to Lessees No. 2010-N05 (NTL5), which imposed new substantive requirements on drilling operations on the OCS. These new requirements, which had been recommended in the DOI Safety Measures Report, applied to
On June 18, 2010, MMS issued Notice to Lessees No. 2010-N06 (NTL6), which rescinded certain limitations set forth in an earlier notice that addressed the information that lessees and operators were required to submit regarding blowout and worst-case discharge scenarios. NTL6 also modified the calculation of the worst-case discharge for purposes of Oil Spill Response Plans (OSRPs). This change, according to plaintiffs, increased the amount of Oil Spill Financial Responsibility (OSFR) that plaintiffs must demonstrate before performing under them lease. Plaintiffs assert that, due to that increase, it is now economically impracticable for plaintiffs to obtain a bond necessary to demonstrate sufficient OSFR.
NTL6 also requires operators to submit additional information for all Exploration Plans, Development Production Plans, and Development Coordination Documents— whether those documents had already been approved or were still pending — that involved activity authorized by a drilling permit that was not yet approved by the effective date of NTL6. Before NTL6, according to plaintiffs, lessees were required to provide additional information only on a case-by-case basis pursuant to 30 C.F.R. § 250.201(b) (2011). Plaintiffs assert that the new requirements of NTL6 violate that regulation and others.
On July 12, 2010, DOI issued a decision memorandum that rescinded the initial moratorium, but also ordered BOEMRE to issue a new suspension on drilling permits based upon a second deepwater moratorium to remain in effect through November 30, 2010. On August 16, 2010, the Director of BOEMRE directed the agency to no longer use certain categorical exclusions in performing reviews of drilling operations under the National Environmental Policy Act of 1969 (NEPA), 42 U.S.C. §§ 4321, 4331-4335 (2006). On September 27, 2010, BOEMRE required plaintiffs to revise their OSRP. Plaintiffs submitted their revised OSRP on November 15, 2010. BOEMRE had not taken action on plaintiffs’ OSRP as of January 25,2011.
On October 1, 2010, the Director of BOEMRE submitted a decision memorandum to the Secretary of the Interior recommending that the second moratorium be lifted. DOI terminated the second moratorium in a decision memorandum on October 12, 2010, but also ordered BOEMRE to require the chief executive officer (CEO) of any operator seeking to perform deepwater drilling that would have been subject to the second moratorium to certify that the operator had complied with all applicable regulations.
In addition to imposing NTL5, BOEMRE drafted a Drilling Safety Rule (DSR) and a Workplace Safety Rule. Because of these actions, according to plaintiffs, the proved reserves associated with the lease were discounted by the senior lender at that time and subsequently by the financial markets. Ultimately, the high-yield debt to finance the project was issued at an interest rate that was higher than that paid by any other issuer of high-yield debt at that time.
The new DSR, including safety rules contained in NTL5 as well as other new substantive rules that had been recommended in the Safety Measures Report, was published in the Federal Register on October 14, 2010, 75 Fed.Reg. 63346. The DSR was published without notice and comment and became effective immediately upon publication. Under the DSR, when BOEMRE regulations incorporate documents of the American Petroleum Institute (API) by reference, operators and lessees must read the use of the term “should” to mean “must.” BOEMRE regulations incorporate approximately eighty API documents, which contain 14,000 uses of the word “should.”
On November 8, 2010, BOEMRE issued Notice to Lessees No. 2010-N10 (NTL10), which requires the CEO compliance statement discussed in the October 12, 2010 memorandum. NTL10 also informed lessees that
BOEMRE has continued to issue new regulations and substantive edicts to the OCS lessees (through electronic mail and other means of communication). As of January 25, 2011, BOEMRE had not issued a new permit to drill in the deepwater of the Gulf of Mexico since April 2010.
II. Procedural History
On January 25, 2011, plaintiff Century Exploration New Orleans, Inc. (Century) filed its complaint in this court.
On April 5, 2011, defendant filed a motion to order joinder of a non-party, Champion, pursuant to RCFC 19(a). In the alternative, defendant asserts that the instant suit should be dismissed in its entirety pursuant to RCFC 12(b)(7) and RCFC 19(b) in the event that joinder of Champion proves to be infeasible. In addition, defendant further asserts in its motion that the takings claim raised in Count II of the complaint must be dismissed under RCFC 12(b)(6) for failure to state a claim upon which relief can be granted. Because the property rights at issue in plaintiffs’ takings claim were created by the lease that plaintiffs allege has been breached by the government, defendant argues that plaintiffs must seek relief under a breach of contract theory, not under a takings theory.
On April 22, 2011, Century responded to defendant’s motion for joinder or, in the alternative, to dismiss. In its response, Century asserts that Champion is neither necessary nor indispensable to this litigation. In support of that assertion, Century argues that this court has the authority to accord complete relief to the parties in this case, and that a judgment against the government in the absence of Champion’s participation would neither impair Champion’s ability to enforce its rights nor subject the government to inconsistent obligations. In addition, Century further argues that even if Champion were determined to be a necessary party, it might be feasible to join Champion with or without its consent. Finally, Century contends that it would be premature to dismiss its takings claim before the government has even answered the complaint or the parties have conducted any discovery.
On May 9, 2011, defendant filed its reply to Century’s response. Defendant first argues that Champion is a necessary party in this litigation because a judgment in favor of Century would render Champion’s remaining interest in the lease essentially valueless. Defendant further argues that Champion is a necessary party for the additional reason that the failure to join Champion in this suit might subject the government to multiple and inconsistent judgments with respect to the same alleged breach of contract. Finally, defendant argues that a plaintiff cannot pursue concurrent takings and breach claims
On June 21, 2011, the court issued an order directing the Clerk’s Office to notify Champion of the pendency of this action as a potentially interested party pursuant to RCFC 14(b). That notice was duly issued by the Clerk’s Office on July 19, 2011.
On September 12, 2011, Champion filed a complaint against defendant in accordance with RCFC 14(c). In its complaint, Champion adopts the allegations set forth in the initial complaint filed by Century, but reserves its right to make an election of remedies at a later date. Pursuant to a subsequent order of the court, Champion responded to defendant’s pending motion to dismiss Count II of the complaint on October 14, 2011. In its response, Champion asserts that the government is incorrect in its assertion that property rights created by contract are categorically excluded from the protection of the Fifth Amendment. According to Champion, the court should not dismiss its takings claim before it has determined whether the government was acting in a proprietary or a sovereign capacity when it interfered with Champion’s rights under the lease. In that regard, Champion contends that it should be allowed to pursue its takings claim in the event that its breach of contract claim is barred under an affirmative defense such as the sovereign acts defense.
Defendant filed its reply to Champion’s response on October 31, 2011. While defendant acknowledges that there is authority from this court to support plaintiffs’ argument that they may pursue concurrent takings and breach claims even if their asserted property rights were created by the breached contract, it argues that contrary authority from this court — holding that a takings claim is barred by a breach claim when the property rights alleged to have been taken were created by the contract that was alleged to have been breached — is better reasoned and should be followed in this ease. Defendant further asserts that the successful invocation of the sovereign acts defense in response to plaintiffs’ breach claim would not allow plaintiffs to prevail under a takings theory. On the contrary, the government argues that a breach of contract may effect a taking only when the government prevents the enforcement of the contract by eliminating the forum for litigating the rights created by that contract.
The court heard oral argument from the parties on the government’s motion to dismiss on November 8, 2011.
DISCUSSION
I. Standard of Review
It is well-settled that a complaint should be dismissed under RCFC 12(b)(6) “when the facts asserted by the claimant do not entitle him to a legal remedy.” Lindsay v. United States,
II. Analysis of Defendant’s Motion to Dismiss
The issue now before the court is a narrow one: may a plaintiff pursue a breach of contract claim and a Fifth Amendment takings claim in the same suit when the property interest alleged to have been taken arises under the contract alleged to have been breached? For the reasons discussed below, the court answers that question in the affirmative.
A. Uncompensated Takings of Contract Rights
Both the United States Supreme Court and the United States Court of Appeals for the Federal Circuit have held that contractual rights are cognizable property interests protected under the Takings Clause of the Fifth Amendment. See Lynch v. United States,
There are two broad — and distinct — categories of cases involving the alleged taking of contractual rights. First, there is the line of cases following Omnia Commercial Co. v. United States,
In addition to Omnia and its progeny, there is a second line of cases in which the government is actually one of the parties to the contract at issue. One of the most important — and frequently contested — threshold issues in this type of case is whether a plaintiff may raise a takings claim and a breach of contract claim in the same suit, particularly when the asserted property right was created by the breached contract. The takings claim advanced by plaintiffs in the present case falls into this second broad category.
In a number of eases, the Court of Claims, the Federal Circuit, and this court have warned against “commingling takings compensation and contract damages[.]” See Hughes Commc’ns Galaxy, Inc. v. United States,
In Castle v. United States,
In short, the Federal Circuit did not hold in Castle that a plaintiff is precluded from raising a takings claim when its asserted property rights were created by contract; rather, the court merely held that the plaintiffs in that particular case had failed to demonstrate the existence of a compensable property right under their contract.
Before the Federal Circuit’s decision in Stockton East II, there had long been a split in this court with respect to the issue of whether a plaintiff may raise both a takings claim and a breach of contract claim in the same suit. In resolving the question of whether a plaintiff may pursue both claims, the judges on this court have generally focused on one or both of two issues related to the takings claim: (1) whether the government was acting in a sovereign or a proprie
1. Nature of the Governmental Action
In some cases, the Court of Claims, the Federal Circuit, and this court have held that the capacity in which the government acts is an important consideration in suits alleging an uncompensated taking of property rights created by contract. For example, in Hughes Communications,
Similarly, in Janicki Logging Co. v. United States,
Defendant argues that it is irrelevant whether the government was acting in a sovereign or proprietary capacity when it imposed the temporary moratoria on deep-water drilling in the Gulf of Mexico and implemented new regulations and requirements for such drilling. Some isolated statements by the Federal Circuit appear to support that assertion:
In whatever other context it may be useful, moreover, determination of whether the United States has acted in a proprietary or governmental-sovereign capacity is of little, if any, use in Fifth Amendment-just compensation analysis. The purpose and function of the Amendment being to secure citizens against governmental expropriation, and to guarantee just compensation for the property taken, what counts is not what the government said it was doing, or what it later says its intent was, or whether it may have used the language of a proprietor. What counts is what the government did.
Yuba Goldfields, Inc. v. United States,
Here, the government confirmed during oral argument that it was acting in a sovereign capacity when it imposed the temporary moratoria and adopted the new regulations and requirements for deepwater drilling on the OCS. Thus, to the extent it could be argued that the existence of a sovereign act is a necessary prerequisite to a successful takings claim, the government has conceded here that it was acting in its sovereign capacity. It is clear, however, that the mere exercise of sovereign power by the government is not sufficient to demonstrate that the government has effected a taking of private property without just compensation. On the contrary, most exercises of the government’s sovereign power do not result in a taking of private property requiring compensation. In
2. Source of the Property Rights Allegedly Taken
In those cases that have focused on the source of the property rights alleged to have been taken, this court has not spoken with a unified voice. In some of those eases, the court has held that a plaintiff may pursue a takings claim and a breach claim in the same suit, but only if the property rights allegedly taken existed independently of the breached contract. Under those eases, when the asserted property right is created by the breached contract, the takings claim must be dismissed. In Consumers Energy Co. v. United States,
In other eases, however, this court has held that a plaintiff may plead and litigate both a takings claim and a breach claim, even if the asserted property right was created by the breached contract:
It is appropriate to proceed with both claims until the contract claim reaches fruition. Only after the contract claim has been fully litigated will it be possible to determine if the contract claim is viable. Some decisions of the court have dismissed takings claims once the government has been held liable for breach of contract prior to addressing damages under a contractual theory, while others preserve both claims until final judgment is rendered. Each of these decisions embraces the underlying principle that contract and takings claims may be pled and argued in the alternative, and that a viable breach-of-contract claim trumps a valid takings claim. Viewed at the end of the proceedings in a case, these decisions may have produced the same results, but this court nonetheless holds that maintaining both claims is a more appropriate course prior*80 to the time judgment is rendered on the contract claims.
System Fuels, Inc. v. United States,
The court notes that in many of the eases in which this court dismissed claims based on an alleged taking of contractual rights, the court resolved the breach of contract claim before dismissing the alternative takings claim, or did so concurrently with its dismissal of the takings claim. See, e.g., Castle,
In its response to the government’s motion to dismiss, Century argues that the court should not dismiss plaintiffs’ takings claim because further discovery might reveal that plaintiffs possess private property rights that exist independently of their lease. During oral argument, however, counsel for plaintiffs conceded that the private property rights alleged to have been taken in this case were created by the lease and do not exist independently of it. Nonetheless, plaintiffs maintain that their takings claim should be preserved until the court has resolved their breach claim. Plaintiffs argue that they should be allowed to proceed with their takings claim in the event that this court dismisses their breach of contract claim based on an affirmative defense such as the sovereign acts defense. In support of their position on that particular issue, plaintiffs reference this court’s decision in Franconia Associates v. United States,
Defendant, in contrast, argues that the dismissal of plaintiffs’ breach claim under the sovereign acts defense would not allow plaintiffs to proceed with their takings claim and
At least as described in Winstar and Castle, the rule favoring contract remedies depends upon there being symmetry between the contract rights to be enforced and the contract damages that are potentially available. Once this symmetry is established, a finding on the merits that no breach occurred does not break that relationship, but merely reflects that the contract rights that were asserted either never existed or were not adversely affected by the government’s actions. Under either scenario, those same contract rights cannot provide the predicate for a takings because the government cannot take what the claimant does not have.
Id. (emphasis added). While defendant may be correct that plaintiffs’ failure to demonstrate a breach of contract would foreclose the argument that anything has been taken from them, that reasoning would not apply to the sovereign acts defense, which shields the government from contractual liability even when there is no question that the contract at issue has been breached by the government.
Defendant posits that there is only one narrow circumstance in which a plaintiff might properly pursue a takings claim based on an interference with rights that were created by a contract with the government. According to defendant, a plaintiff may pursue a claim based on the alleged taking of contractual rights only when both of the following requirements are met: (1) the government repudiates a contract with the plaintiff; and (2) the government then eliminates the only forum for enforcing that contract. In support of its purported two-prong test, defendant points to the Supreme Court’s decision in Lynch,
In Stockton East Water District v. United States,
The Federal Circuit vacated this court’s dismissal of the takings claim, noting that the language in the cases upon which the court had based its decision was “nothing more than a passing comment about government contract law, and has to be understood in that context.” Stockton East II,
cannot be understood as precluding a party from alleging in the same complaint two alternative theories for recovery against the Government, for example, one for breach of contract and one for a taking under the Fifth Amendment to the Constitution. That is expressly permitted by the Federal Rules, and the fact that the theories may be inconsistent is of no moment.
Id. (citing Fed.R.Civ.P. 8(d)(3)).
The Federal Circuit explained that it is entirely appropriate for this court to defer its consideration of a takings claim while the court addresses a concurrently pled breach of contract claim:
[Wjhen a case arises in which both a contract and a taking cause of action are pled, the trial court may properly defer the taking issue, as it did here, in favor of first addressing the contract issue. It has long been the policy of the courts to decide cases on non-constitutional grounds when that is available, rather than reach out for the constitutional issue.
Id.
In addition, the Federal Circuit noted that when a plaintiff is ultimately awarded damages under a breach of contract theory, that plaintiff cannot also recover under its alternative takings theory:
It is well established, as these cases explain, that a party can obtain only one recovery for a single harm regardless of how many legal theories there may be for a recovery. In our case, while one recovery is all that can be had for the same harm, the fact that a cause of action was pled under a contract theory did not preclude a separate count for a cause of action based on a taking.
Id. at 1369. In the view of the Federal Circuit, the cases cited by this court in Stockton East I do not stand for the proposition that a plaintiff cannot pursue a claim under the Fifth Amendment based on the alleged taking of contractual rights; rather, those cases merely state that a plaintiff cannot recover twice for the same harm by invoking two different legal theories. For that reason, once a plaintiff recovers under a breach theory, the court need not address the merits of the alternative takings claim. Id. at 1368 (“And of course when a plaintiff is awarded recovery for the alleged wrong under one theory, there is no reason to address the other theories.”).
The government attempts to distinguish Stockton East II on the basis that the plaintiffs in that case alleged the taking of a property interest that existed independently of the plaintiffs’ contracts with the Bureau. More specifically, the government notes that the plaintiffs in that ease alleged that they possessed a protected property interest under state law in the water covered under the contracts. While that observation is accurate, the Federal Circuit did not vacate this court’s dismissal of the plaintiffs’ takings claim on that basis. In fact, the Federal
Defendant also argues that the Federal Circuit’s holding in Stockton East II should not be read to endorse the proposition that a plaintiff may pursue a takings claim when it has failed to recover on a breach of contract claim. In its opinion, however, the Federal Circuit stated that the plaintiffs “are free to pursue their takings claim if they so choose with regard to the years for which the Government has been found not liable as a matter of contract law.”
Finally, defendant asserts that the Federal Circuit’s discussion of the takings issue in Stockton East II should be viewed as nothing more than dicta in light of Judge Gajarsa’s dissent from that decision and his dissent from Stockton East III. However, the mere absence of unanimity in a Federal Circuit holding does not render that holding dicta. The Federal Circuit has held that a plaintiff may pursue both a takings claim and a breach of contract claim in the same complaint, and that holding was not dicta. Accordingly, this court will not dismiss plaintiffs’ takings claim on that basis.
The court notes that the scope of its holding in this opinion is quite narrow. The court does not hold that plaintiffs will prevail on their takings claim, nor does it hold that plaintiffs may successfully proceed with their takings claim if the government successfully invokes the sovereign acts defense. Those issues have not been fully addressed by the parties, so the court will not resolve them here. Rather, the sole holding set forth in this opinion is that this court is not required to dismiss a takings claim under RCFC 12(b)(6) for the mere reason that the property rights alleged to have been taken by the government were created by the same contract plaintiffs assert has been breached. Because the viability of plaintiffs’ takings claim will turn on the court’s resolution of their breach claim, the takings claim shall be stayed during the litigation of the breach claim.
CONCLUSION
The court concludes that plaintiffs are not precluded from pursuing, in the same complaint, a breach of contract claim and a Fifth Amendment takings claim as alternative theories of recovery. For that reason, defendant’s motion to dismiss Count II of the complaint under RCFC 12(b)(6) is denied. Because Champion is now a party to this suit, defendant’s motion for joinder is denied as moot.
Accordingly, it is hereby ORDERED that
(1) Defendant’s Motion to Dismiss Count II of the Complaint, filed April 5, 2011, is DENIED;
(2) Defendant’s Motion for Joinder of Champion Exploration, LLC or, in the Alternative, to Dismiss, filed April 5, 2011, is DENIED as moot;
(3) Defendant shall FILE its Answer to plaintiffs’ complaints, or otherwise re*84 spond to them, on or before February 24, 2012.15
Notes
. The facts recounted here are largely taken from the initial complaint in this case and are undisputed unless otherwise noted. The court makes no findings of fact in this opinion.
. In May 2010, the Secretary of the Interior announced that MMS would be split into three separate agencies: the Bureau of Safety and Environmental Enforcement (BSEE), the Bureau of Ocean Energy Management (BOEM), and the Office of Natural Resources Revenue (ONRR). DOI Secretarial Order No. 3299 (May 19,'2010). In June 2010, MMS was renamed BOEMRE. DOI Secretarial Order No. 3302 (June 18, 2010). The revenue-collection functions of BOEMRE were transferred to ONRR in October 2010, and BOEMRE was then divided into two new agencies, BSEE and BOEM, in October 2011. See Direct Final Rule, 76 Fed.Reg. 64432-01 (October 18, 2011).
. Century Exploration New Orleans, Inc. owns a 90.472222-percent interest in the subject lease, while Champion owns the remaining 9.527778-percent interest. In its motion, defendant surmises that Champion acquired its interest in the subject lease in October 2009. In its overview of the facts, the court will generally refer to both plaintiffs collectively, even where the described event may have occurred before Champion acquired its interest in the lease.
, The term "proved reserves" essentially refers to the quantity of petroleum that is expected to be recovered from the leased area with a reasonable degree of certainty, while "probable reserves” refers to the additional quantity of petroleum that is less likely to be recovered than proved reserves but more likely to be recovered than "possible reserves.” Compl. ¶ 11 nn. 5-6. There should be at least a fifty percent probability that the quantity of petroleum actually recovered will equal or exceed the sum of proved reserves and probable reserves (also known as "2P”). Id. Ulln. 6.
.The United States District Court for the Eastern District of Louisiana subsequently enjoined enforcement of this moratorium on June 22, 2010. See Hornbeck Offshore Servs., LLC v. Salazar,
. The Eastern District of Louisiana set aside NTL5 because it imposed new substantive requirements on drilling operations and was not promulgated in accordance with the requirements of notice-and-comment rulemaking. See Ensco Offshore Co. v. Salazar, No. 10-1941,
. During oral argument, counsel for defendant stated that the government had issued thirty-four permits to drill new wells in the Gulf of Mexico and one hundred revised permits since October 2010.
. On November 23, 2010, Century sent to the President, the Secretary of the Interior, the Director of BOEMRE, local BOEMRE officials, and the Governor of Louisiana a letter that provided notice of Century’s claims and requested a decision on those claims within sixty days as required under OCSLA, 43 U.S.C. § 1349(a)(2)(A). The letter and supporting documents were delivered to the United States on November 24, 2010. Century received no response from the government within the sixty-day time period.
. The court subsequently granted the government’s motion for reconsideration based on the Supreme Court’s decision in Tahoe-Sierra Pres. Council, Inc. v. Tahoe Reg’l Planning Agency,
. In contrast to the plaintiffs in this case, moreover, the plaintiffs in Castle did not raise their takings claim as an alternative to their breach claim; rather, they sought to recover under both legal theories. See id. ("[The plaintiffs] contend that the Fifth Amendment entitles them to just compensation beyond damages for breach of contract.”) (emphasis added).
. In some cases, this court has held that a plaintiff must allege the taking of a property right that exists independently of the breached contract, but has declined to dismiss the takings claim under RCFC 12(b)(6) when it is unclear, early in the litigation, whether such an independent right exists. See, e.g., Barlow & Haun, Inc. v. United States,
. The court notes that there are cases from the Federal Circuit that bear a superficial similarity to the present case, and appear to support the approach of System Fuels, but are distinguishable on the basis that the plaintiffs in those cases were not in privity of contract with the government and therefore could not have raised a breach claim. See Cienega Gardens v. United States,
. During oral argument, counsel for defendant stated that the government had performed exhaustive research of the case law and was not aware of a single case in which a court has held that a breach of contract action was barred by the sovereign acts defense, but then proceeded to award just compensation to the plaintiff under a Fifth Amendment takings theory. However, the court is aware of at least one such case. In Hedstrom Lumber Co. v. United States,
. Defendant also attempts to distinguish Stockton East II on the basis that the government’s action in that case "significantly affected” the plaintiffs' water contracts, while the governmental action here involved regulations that were expressly contemplated under the lease. While that distinction might ultimately impact the court's analysis of whether plaintiffs have demonstrated a regulatory taking under Penn Central Transportation Co. v. City of New York,
. With respect to a potential settlement of this matter, the court reminds the parties that this case was assigned to Judge Christine O.C. Miller for Alternative Dispute Resolution (ADR) on January 25, 2011.