This Dumb Lawsuit Could Cost North Dakota Taxpayers Big Time

For some reason two former gubernatorial candidates – Democratic state Rep. Marvin Nelson and gadfly Paul Sorum – have filed a lawsuit trying to stop the State of North Dakota from recognizing the private ownership of minerals (read: oil and gas) under Lake Sakakawea.

That’s a man-made lake. Everyone agrees that the state owns the mineral rights under the Missouri River, including the historic river channel which existed before the lake was created with the Garrison Dam. What the state had been doing was trying to claim the mineral rights under the lake and outside that channel. While the surface rights to that land were purchased by the federal government back in the 1950’s when the lake was created, there was no purchase made of the mineral rights.

The Legislature passed a bill last session to recognize the private ownership of those minerals. But Nelson, Sorum, and their fellow plaintiffs argue that the legislation is a) unconstitutional and b) amounts to the state giving away revenues. They said as much yesterday at a press conference:

Nelson said it’s unconstitutional for the Legislature to give away state property to private persons, but Senate Bill 2134 creates a special set of rules and conditions for one segment of the Missouri River.

Sorum said the court is not being asked to declare who owns any particular minerals, he said, but whether the statute is unconstitutional.

“When the Legislature is cutting budgets as deeply as they have, we think it’s important that they keep these taxpayer assets in place and not give them away,” Sorum said.

But how can the State of North Dakota give away something it doesn’t own?

The ownership of those minerals is at the heart of this controversy. While the State of North Dakota, through the Board of University and School Lands, has (rather bizarrely) tried to claim those minerals, the state Supreme Court has sided with the private owners.

In an opinion in Wilkinson vs. The Board of University and School Lands of the State of North Dakota, a lawsuit filed by some of the mineral rights owners, the state Supreme Court stated that the government never purchased the mineral rights: “The federal government compensated the plaintiffs for the surface property, but the plaintiffs have not been compensated for the mineral interests,” the court wrote.

Further, the court found that if it’s determined that the government does, in fact, own the mineral interests in question there must be payment made for them: “The plaintiffs are entitled to compensation if the government’s actions result in a ‘taking’ of the mineral interests.”

Nelson and Sorum are arguing that the Legislature illegally gave away property. That’s not the case. Instead the Legislature was trying to rescind the state’s claim on property which is very much in dispute.

They also argue that the Legislature’s actions are costing the state money, but again that’s not the case. Even if the mineral rights end up in state hands, the court has already ruled that the taxpayers must reimburse the mineral rights owners for them.

There is no win here, so what’s the point of this lawsuit?

Recently Roger Sundahl, a member of the Wilkinson family, wrote a guest post for SAB questioning the funding for Sorum and Nelson’s lawsuit. “[W]ho is paying their legal bill to try to wrongfully claim our minerals while ignoring the decision of the North Dakota Supreme Court?” he asked.

It’s a question I’d like to hear them answer.