Scenic America, Inc. v. United States Department of Transportation
2016 U.S. App. LEXIS 16330
| D.C. Cir. | 2016Background
- The Highway Beautification Act (HBA) requires federal-state agreements (FSAs) setting standards for billboard "size, lighting and spacing;" most FSAs bar "flashing, intermittent or moving" lights.
- New digital billboards (CEVMS) display static ads that change every few seconds; state FHWA Division Offices differed on whether such signs violate FSA lighting bans.
- In 2007 FHWA national office issued a Guidance saying CEVMS meeting timing/brightness criteria do not violate FSA lighting prohibitions (creating a voluntary safe harbor).
- Scenic America sued, alleging (1) the Guidance was a legislative rule issued without required notice-and-comment (APA §553) and (2) the Guidance violates the HBA because it is not "consistent with customary use" (reviewable under APA §706).
- District Court granted summary judgment for defendants on both claims; this appeal resulted in affirmance of the §706 ruling but dismissal of the notice-and-comment claim for lack of standing.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Guidance required notice-and-comment (i.e., was legislative) | Guidance is effectively a legislative rule changing FSA standards and thus needed §553 procedures | Guidance is interpretive guidance, not a rule, so no notice-and-comment required | Court did not reach merits because Scenic lacks standing to challenge notice-and-comment; claim dismissed for lack of jurisdiction |
| Standing/redressability for notice-and-comment claim | Vacating Guidance would reduce states/Division Offices permitting digital billboards, lowering Scenic’s litigation/monitoring costs | Vacatur would not reliably change independent third-party (Division Offices/states) decisions; redress is speculative | Scenic failed to prove redressability (third-party choices speculative); lacked standing for notice-and-comment claim |
| Whether the Guidance is final agency action under APA | N/A (challenge focused on procedural rulemaking and HBA conformity) | Guidance consummates FHWA decision-making and imposes legal consequences (safe harbor) | Guidance is final agency action and thus reviewable under the APA |
| Whether Guidance violated HBA §131(d) ("consistent with customary use") under APA §706 | Guidance alters FSA lighting standards beyond customary use and is contrary to law | FHWA’s interpretation is a reasonable construction of ambiguous FSA lighting terms and functions as an interpretive reconciliation entitled to deference | Court found FHWA’s interpretation reasonable, not contrary to customary use; affirmed summary judgment for defendants on §706 claim |
Key Cases Cited
- Lujan v. Defenders of Wildlife, 504 U.S. 555 (standing requires injury, causation, redressability)
- Bennett v. Spear, 520 U.S. 154 (standard for final agency action)
- Simon v. E. Ky. Welfare Rights Org., 426 U.S. 26 (speculation insufficient for standing/redressability)
- National Wrestling Coaches Ass'n v. Dep't of Educ., 366 F.3d 930 (third-party decision problem undermines redressability)
- Renal Physicians Ass'n v. United States Dep't of Health & Human Servs., 489 F.3d 1267 (vacatur of agency safe harbor may not redress injuries where safe harbor was voluntary)
- Cajun Elec. Power Coop. v. FERC, 924 F.2d 1132 (agency interpretation of approved agreements entitled to deference)
- NRDC v. EPA, 643 F.3d 311 (withdrawing previously held discretion can have binding legal effect)
- Sierra Club v. EPA, 292 F.3d 895 (appellate consideration of standing akin to summary judgment scrutiny)