United States v. Pan-American Petroleum Co.
Court of Appeals for the Ninth Circuit · 1932-02-05 · cited 39×
This case concerned the validity of three oil leases issued in 1921 and 1922 to Pan-American Petroleum Co. covering acreage in Naval Petroleum Reserve No. 1 in Kern County, California, which the United States challenged as fraudulent, the product of conspiracy, and issued without legal authority under statutes governing public lands and naval reserves. Building on a prior related suit that canceled other leases involving the same underlying scandal, the Ninth Circuit reversed the district court's judgment upholding the leases. The court held that the prior litigation did not bar the claims because each lease was a distinct transaction and cause of action not encompassed by the congressional resolution limiting the first suit, that the leases were independently tainted by the same fraud involving Secretary Fall and others, and that defenses such as estoppel or failure to do equity lacked merit. It directed the district court to enter a decree canceling the leases and restoring the lands to the government.