DETROIT INTERNATIONAL BRIDGE COMPANY, et al., Plaintiffs, v. GOVERNMENT OF CANADA, et al., Defendants.
Civil Action No. 10-476 (RMC)
United States District Court, District of Columbia.
Signed May 26, 2016
Douglas A. Dozeman, Eugene E. Smary, Scott M. Watson, Warner Norcross & Judd LLP, Grand Rapids, MI, Brian Matthew Collins, Davene Dashawn Walker, U.S. Department of Justice, Peter Christopher Whitfield, Baker Hostetler, Washington, DC, for Defendants.
OPINION ON MOTION FOR PARTIAL RECONSIDERATION
ROSEMARY M. COLLYER, United States District Judge
Plaintiffs Detroit International Bridge Company and its wholly-owned subsidiary, the Canadian Transit Company (collectively DIBC), seek partial reconsideration of the Court‘s September 30, 2015 Opinion and Order dismissing Counts 1, 2, 3, 5, 6, 8, and 9 of DIBC‘s Third Amended Complaint (TAC), Dkt. 105. See Mot. for Reconsideration [Dkt. 233].1 Specifically, DIBC asks the Court to reconsider its dismissal of Counts 2, 3, 6, and 9. Federal Defendants timely opposed the motion, see Dkt. 242, and DIBC replied, see Dkt. 258.
The facts of this case are well known.2 In 1921, U.S. Congress enacted a federal statute granting DIBC the rights “to construct, maintain, and operate” an international bridge between Detroit Michigan and Windsor Ontario. See
I. LEGAL STANDARD
II. ANALYSIS
DIBC asks the Court to reconsider the dismissal of Counts 2, 3, 6, and 9. Specifically, DIBC argues, inter alia, that: (1) Federal Defendants violated DIBC‘s right to maintain and operate the Ambassador Bridge and build the Twin Span; (2) Federal Defendants violated the constitutional doctrine of separation of powers because Congress has supported the Ambassador Bridge and its Twin Span; (3) the issuance of the NITC/DRIC Presidential permit is reviewable under the
DIBC concedes that “[i]n its zeal to assert every argument in defense of the Ambassador Bridge, [it] may have ‘overplay[ed its] hand.‘” Mot. for Reconsideration at 1 (quoting Mem. Op. at 27). DIBC now seeks reconsideration of a “subset of those dismissed claims“, because it may not have articulated some of them “as clearly as [it] should have ....” Id. The problem with DIBC‘s arguments is not lack of clarity. Rather, the Court disagrees with most of DIBC‘s legal conclusions.
A. Count 2—Statutory and Contractual Rights under DIBC Act
In the DIBC Act of 1921, Congress authorized DIBC “to construct, maintain, and operate a bridge and approaches thereto across Detroit River at a point suitable to
1. Congressional Authorization Argument
DIBC argues that this Court failed to address its alternative claim in Count 2—namely, that even if Congress did not “relinquish its powers” when it enacted the DIBC Act, DIBC still prevails because it has “the only franchise for a bridge between Detroit and Canada ‘unless and until’ Congress and the Canadian Parliament expressly authorize a second such bridge.” Mot. for Reconsideration at 17 (quoting TAC ¶ 312(c)) (emphasis added); see also Reply [Dkt. 258] at 10 (arguing that “only Congress can authorize a bridge that interferes with the Ambassador Bridge ....“). But this “alternative” claim is not new and has been thoroughly considered.
The argument that DIBC has “the only franchise” for a bridge in that area of the Detroit River necessarily presupposes that the DIBC Act contained an implied grant of perpetual exclusivity. The language of the statute does not support this claim, see
The crux of DIBC‘s position is that Federal Defendants violated its franchise rights under the DIBC Act because Congress “never enacted a law that specifically authorize[d] the NITC/DRIC.” Mot. for Reconsideration at 17. Trying to conceal its dependence on a grant of exclusivity that never took place, DIBC relies on the fact that Charles River Bridge “involved two commensurate acts by the same sovereign legislature, each with equal specificity as to what that sovereign was authorizing.” Id. According to DIBC, the facts in Charles River Bridge require Congress to authorize the NITC/DRIC. The argument is a red herring. DIBC does not explain why this factual distinction is relevant, let alone dispositive.5 Further, Congress did not have to authorize directly the construction of the NITC/DRIC because, in 1972, Congress consented to “the construction, maintenance, and operation of [all] international bridges” so long as the “foreign country consent[s], the proposed bridge compl[ies] with the
The IBA governs the proposed construction of the NITC/DRIC and to require additional congressional action, as DIBC suggests, directly contravenes Congress‘s
2. Separation of Powers Argument
DIBC also argues that Count 2 “encompasses a pure constitutional claim that the Executive Branch is violating the Separation of Powers through its approvals of the NITC/DRIC.” Mot. for Reconsideration at 19 (emphasis in original). DIBC claims that the Court failed to address this “constitutional claim” in its September 30, 2015 Opinion and that it should consider it now. However, such a claim is nowhere to be found in Count 2, TAC, or DIBC‘s prior briefing. Count 2 focuses only on the alleged “violation of [DIBC]‘s statutory and contractual franchise rights” under the DIBC Act. TAC ¶ 299; see id. ¶¶ 305, 308, 311-12. Count 2 does not mention “separation of powers” and does not make any direct or indirect references to the U.S. Constitution.
“Judges are not expected to be mindreaders. Consequently, a litigant has an obligation to spell out its arguments squarely and distinctly, or forever hold its peace.” United States v. Zannino, 895 F.2d 1, 17 (1st Cir. 1990). DIBC never articulated a separation of powers argument in Count 2 and “arguments that should have been previously raised, but are only raised for the first time in a motion for reconsideration, will not be entertained by this Court.” James v. England, 226 F.R.D. 2, 7 (D.D.C. 2004). Count 2 will remain dismissed.6
B. Count 3—Right to Build Twin Span
The Court dismissed Count 3 for failure to state a claim on the basis that the proposed construction of the NITC/DRIC did not violate DIBC‘s right to build the Twin Span because DIBC lacked an exclusive right to the Detroit-Windsor crossing. DIBC argues that the Court erred in dismissing Count 3 because “Count 3 was based solely on Plaintiffs’ statutory right to ‘operate and maintain’ the Ambassador Bridge without any time limit, and was pled as an alternative to any theory of exclusivity.” Mot. for Reconsideration at 12. DIBC contends that “[t]he Court should reconsider its dismissal of Count 3 because the plain text of the DIBC Act unmistakably provides a right to maintain and operate the Ambassador
Federal Defendants do not dispute that the DIBC Act granted “perpetual consent” to DIBC to “maintain and operate” the Ambassador Bridge and that this right includes expanding or replacing the Ambassador Bridge by building the Twin Span. See Opp‘n at 10; see also Mem. Op. at 32-33. The Court never held or found anything to the contrary. It indicated that “Congress granted DIBC the right to ‘construct, maintain, and operate a bridge’ in the vicinity of Detroit,” Mem. Op. at 21 (quoting
The crux of DIBC‘s position is articulated in the Motion for Reconsideration: “Plaintiffs are entitled to discovery to show that the NITC/DRIC is the functional equivalent of the Plaintiffs’ Twin Span, and hence violates Plaintiffs’ right to build their Twin Span.” Mot. for Reconsideration at 16. Specifically, DIBC contends that the Court overlooked several allegations supporting Count 3: (1) Federal Defendants accelerated the approvals for the NITC/DRIC at the expense of DIBC, while delaying the regulatory approvals for the Twin Span; and (2) Federal Defendants “promoted and approved the NITC/DRIC without giving any consideration at all to whether it was necessary given [DIBC‘s] expressed desire and constant effort to build the[] Twin Span.” Id. at 14 (citations omitted); see TAC ¶ 19 (alleging that DIBC has “the right build the New Span to the Ambassador Bridge and any government action by defendants that seeks to favor the NITC/DRIC over the New Span to prevent plaintiffs from exercising their right to build the New Span is a breach of plaintiffs’ franchise rights ....“).
These allegations do not support the claim that Federal Defendants have violated DIBC‘s right to maintain and operate the Ambassador Bridge. If anything, these allegations merely support a claim that Federal Defendants violated DIBC‘s desire to maintain a profitable business. “[T]he planned construction of the NITC/DRIC does not violate [DIBC‘s] right to build the New Span even if threatens the business rationale for doing so.” Mem. Op. at 33. DIBC can still maintain and operate the Ambassador Bridge—particularly since “[t]he economic justification for the New Span is ... not found in increased traffic levels, but instead in reduced maintenance costs and enhanced efficiency in the transit process through customs.” TAC ¶ 6 (alleging that “the New Span would be a desirable upgrade and modernization to the Ambassador Bridge“). Also, DIBC can still build a Twin Span, even if doing so would not be economically feasible. It follows that the premise that NITC/DRIC is the functional equivalent of the Twin Span and that “so long as the NITC/DRIC was built first, it would be impossible for Plaintiffs to build their Twin Span” shows that Federal Defendants’ actions merely threatened the financial viability of the Twin Span. Mot. for Reconsideration at 14-15 (citing TAC ¶¶ 217-21, 343). Promoting the NITC/DRIC did not actually prevent DIBC from exercising any of its rights under the
C. Count 6—APA Challenge to Presidential Permit for the NITC/DRIC
Count 6 alleged that the decision of the U.S. Department of State (USDS) “to grant a Presidential permit for the NITC/DRIC was contrary to law, arbitrary and capricious, in excess of statutory authority, and otherwise in violation of the standards set forth in
DIBC urges the Court “to reconsider its holding that it had no jurisdiction to review the State Department‘s approval of the NITC/DRIC application under Section 4 of the IBA[,
Upon consideration of the parties’ present arguments and further study on the underlying legal issues in Count 6, the Court amends certain findings of its earlier Opinion and expands on its earlier analysis. Its conclusion is the same but for different reasons. Given the complexity of the multiple issues in DIBC‘s APA claim, it is important to review carefully the historical evolution of the legal framework governing the construction, and maintenance of international bridges.
1. Historical Background: From the Rivers and Harbors Act of 1899 to the International Bridge Act of 1972
Congress has long asserted its authority to approve or disapprove bridges over navigable waters, both domestic and international, pursuant to its authority to regulate commerce. See
In 1946, Congress passed the
In the early 1960s, Congressional leaders decided that approval of each international bridge had become too burdensome. As a result, “the Committee on Foreign Relations [began] to explore other means of authorizing the construction of international bridges.” 1972 S. Rep. at 3399. The Committee produced an omnibus bill in “consultation with the executive departments,” which the U.S. Senate first passed in 1964 and again in 1965 and in 1967, but “was not finally enacted by the House” on any occasion. Id. Since no action was taken on the bill, “[o]n September 15, 1971, the executive branch submitted a new draft of legislation,” which was enacted and became the
While the Executive Branch worked on the new draft and Congress worked on its passage, on August 16, 1968, President Lyndon B. Johnson issued Executive Order 11,423, titled “Providing for the Performance of Certain Functions Heretofore Performed by the President with Respect to Certain Facilities Constructed and Maintained on the Borders of the United States.” Exec. Order No. 11,423, 3 C.F.R. 742 (1966-1970), as amended 33 Fed. Reg. 11741 (August 16, 1968) (E.O. 11,423). E.O. 11,423 stated that the “proper conduct of the foreign relations of the United States requires that executive permission be obtained for the construction and maintenance at the borders of the United States of facilities connecting the United States with a foreign country” and that, in the past, “such executive permission has from time to time been sought and granted in the form of Presidential permits for the construction, connection, operation, and maintenance ... of such border crossing facilities as water supply and oil pipelines, aerial tramways and cable cars, submarine cables, and lines for the transmission of electric energy.” Id. Notably absent from this list were international bridges, which pursuant to the Bridge Act of 1906 still required congressional authorization.
E.O. 11,423 designated and empowered the Secretary of State “to receive all applications for permits for the construction,
Congress passed the
No bridge may be constructed, maintained, and operated as provided in section 535 of this title unless the President has given his approval thereto. In the course of determining whether to grant such approval, the President shall secure the advice and recommendations of (1) the United States section of the International Boundary and Water Commission, United States and Mexico, in the case of a bridge connecting the United States and Mexico, and (2) the heads of such departments and agencies of the Federal Government as he deems appropriate to determine the necessity for such bridge.
Finally, E.O. 11,423 prescribed the procedures for the issuance of presidential permits. With respect to applications for the construction of bridges, E.O. 11,423 orders that “the Secretary of State shall request the views of the Secretary of the Treasury, the Secretary of Defense, the Attorney General, and the Secretary of Transportation” and “may consult with such other department and agency heads and with such state and local government officials as he [or she] deems appropriate with respect to each application.” E.O. 11,423, § 1(b)-(c). After this consultation, the Secretary of State shall determine whether “the issuance of a permit to the applicant would serve the national interest“, and notify the officials of the proposed determination. Id., § 1(d)-(e). If U.S. officials who are required to be consulted agree with the proposed determination by USDS, the “Secretary of State shall issue
2. The Relationship between E.O. 11,423 and the IBA
DIBC makes two arguments that implicate this Court‘s earlier analysis of the relationship between E.O. 11,423 and the IBA: (1) presidential approvals under
First, the Court‘s Memorandum Opinion mentioned in passing that DIBC‘s “position conflates permitting for international bridges—the focus of Count 6—and approval for such bridges.” Mem. Op. at 44. The Court added that while “E.O. 11,423 ... sets forth the procedures for the President‘s issuance of bridge permits,” the IBA “says nothing about permits” and instead “requires Presidential approval” of international bridges. Id. DIBC contends that the Court erred in making this distinction. Mot. for Reconsideration at 26-29. To the extent that a presidential permit is different from a presidential approval, DIBC points out that NITC/DRIC would be unlawful because it only received a presidential permit under E.O. 11,423 and not a presidential approval under
In Presidio Bridge Company v. Secretary of State, 486 F. Supp. 288, 292 (W.D.Tex.1978), aff‘d, 612 F.2d 578 (5th Cir.1980), Judge Suttle in the Western District of Texas examined the close relationship between the two documents and concluded that E.O. 11,423 “must be read as a related document to the 1972 Act.” 486 F. Supp. at 292. E.O. 11,423 “was designed to cover border areas—areas that, at the time the Order was drafted [i.e., 1968], were still within the scope of Congressional domain.” Id. at 295.11 Specifically, with respect to international bridges over navigable waters, it was clear
The court in Presidio Bridge faced the same dilemma presented by Count 6 of the instant case: If “[t]here were no bridges under this provision where Congressional authorization was not needed,” why would the President authorize the Secretary of State to consider permits for the construction of “bridges, to the extent that congressional authorization is not required“? Id.; E.O. 11,423 § 1(a). “The most logical explanation for the symbiotic reading of the two documents” and the answer to the dilemma is:
[H]istory, and the words of the documents themselves, show[] that, after four years of work in drafting a bill, the President issued an Executive Order anticipating its final passage; passage was not forthcoming for another three years; but the bill that was ultimately produced was the product of the same arm of the government that issued the Order, and was passed by a Congress that was well aware of both the provisions in that Order and the reason for its existence. The two documents are thus compatible with, and companions to, one another.
Presidio Bridge, 486 F. Supp. at 295-96. Since E.O. 11,423 was issued in expectation of the IBA‘s passage—a historical fact conceded by the parties in their briefs, see Mot. for Reconsideration at 28 and Opp‘n at 15—the Executive Order simply meant to prescribe certain procedures for presidential approval of international bridges. It follows that there is no distinction between “presidential permit” and “presidential approval” and E.O. 11,423 simply entrusted to the Secretary of State a function assigned to the President by Congress in the IBA. See Presidio Bridge, 486 F. Supp. at 296 (“In this respect, the Secretary is also fulfilling an express function assigned him by the 1972 Act ... [I]f the prerequisites detailed in [E.O.] 11,423 are satisfied, the permit has presidential approval as contemplated by
This point leads to DIBC‘s second argument: the issuance of the Presidential Permit for NITC/DRIC was not an exercise of the President‘s inherent constitutional authority, but, rather, an exercise of Congressional authority delegated to the President in the IBA. On reconsideration, the Court reorients and expands its earlier analysis.
The construction of international bridges over navigable waters is an example of “a zone of twilight in which [the President] and Congress may have concurrent authority” pursuant to the President‘s inherent constitutional authority over foreign affairs and Congress‘s power to regulate commerce. Youngstown Sheet & Tube Co. v. Sawyer, 343 U.S. 579, 637, 72 S.Ct. 863, 96 L.Ed. 1153 (1952) (Jackson, J., concurring). However, since Congress regularly passed legislation regulating the construction of bridges in the 19th and 20th centuries, construction of bridges (domestic or international) over navigable waters is not an area in which “congressional inertia, indifference, or quiescence may sometimes, at least as a practical matter, enable, if not invite, measures on independent presidential responsibility.” Id. Fully cognizant that congressional authorization was required for the construction of international bridges, even after the passage of the General Bridge Act of 1946, the President refused to act independently in 1968. By issuing E.O. 11,423 in expectation of the IBA‘s passage, President Johnson anticipated congressional action but did not act in its absence. Thus, E.O. 11,423 only authorized the Secretary of State to consider permits for the construction of “bridges, to the extent that congressional authorization is not required.” E.O. 11,423 § 1(a) (emphasis added). When Congress passed
Historical practice, the language of E.O. 11,423 (“to the extent that congressional authorization is not required“), and the reliance of USDS on the IBA when approving NITC/DRIC‘s permit application demonstrate that USDS did not exercise only the President‘s inherent constitutional authority when it issued the Presidential Permit. See, e.g., 77 Fed. Reg. 40937 (publishing its notice of NITC/DRIC‘s permit application in the Federal Register as required by E.O. 11,423 § 2(a) and stating that USDS‘s “jurisdiction with respect to this application is based upon [E.O. 11,423 and the IBA]“); Mot. for Reconsideration, Ex. 23 [Dkt. 233-25] (Record of Decision) at 2 (citing the IBA‘s requirement that international bridges must be approved by the President).
3. The APA and Presidential Action
DIBC contends that “once the aura of ‘the President‘s inherent constitutional authority’ is removed, the analysis under the APA is quite straightforward and unassailable.” Mot. for Reconsideration at 31. It is not that straightforward. The relevant legal issue in Count 6 does not turn on whether USDS was acting pursuant to the President‘s Article II powers. Rather, the threshold question is whether a challenged action constituted presidential action. Presidential action entails any exercise of discretionary authority retained by the President. Such discretionary authority could be vested in the President by virtue of Article II of the U.S. Constitution or by an Act of Congress. In the instant case, the Court must first determine whether USDS exercised authority committed to the President when it issued the NITC/DRIC Presidential Permit.
The APA provides for judicial review of “final agency action for which there is no adequate remedy in court.”
The President of the United States is not an “agency” under the APA. See Franklin v. Massachusetts, 505 U.S. 788, 800-01, 112 S.Ct. 2767, 120 L.Ed.2d 636 (1992). Franklin involved a challenge to an automatic reapportionment statute, in which Congress directed: (1) the Secretary of Commerce to report to the President the tabulation of total population by States, see
The Supreme Court reiterated this proposition two years later in Dalton v. Specter, 511 U.S. 462, 114 S.Ct. 1719, 128 L.Ed.2d 497 (1994). Dalton involved the
The President‘s actions in Franklin and Dalton were not exercises of the President‘s inherent constitutional authority. Instead, both cases involved “final” exercises of authority vested in the President by Congress. Even so, the ratio decidendi of these two cases indicates that the source of the President‘s authority is irrelevant and the determinative consideration is whether the action involved a discretionary (as opposed to a ministerial or ceremonial) exercise of authority committed to the President by the Constitution or by Congress. Franklin and Dalton emphasized the importance of the President‘s role in two statutory frameworks devised by Congress, as well as the discretionary nature of the presidential actions being challenged. See Dalton, 511 U.S. at 470 (noting the “importance of [the President‘s] role in the base closure process” because “[w]ithout the President‘s approval, no bases [would be] closed under the Act” and the statute did “not by its terms circumscribe the President‘s discretion to approve or disapprove [BRAC‘s] report“); Franklin, 505 U.S. at 800 (“That the final act is that of the President is important to the integrity of the process and bolsters our conclusion that his duties are not merely ceremonial or ministerial.“). In both cases, Congress did not require the President “to adhere to the policy decisions” of an agency. Franklin, 505 U.S. at 799.
Under such circumstances, the APA is not available to review presidential actions—i.e., actions involving the exercise of discretionary authority vested in the President by law. See, e.g., Franklin, 505 U.S. at 800-01 (“We would require an express statement by Congress before assuming it intended the President‘s performance of his statutory duties
In the IBA, Congress gave the President broad discretionary authority to approve the construction and maintenance of international bridges—an authority much broader than those at issue in Franklin and Dalton. With respect to bridges between the United States and Canada, the only limitation imposed on the President is to “secure the advice and recommendations of ... the heads of such departments and agencies of the Federal Government as he deems appropriate to determine the necessity for such bridge.”
The instant matter, however, presents an additional complication absent in Franklin and Dalton because it involves the actions of a delegee. The President designated and empowered the Secretary of State to issue presidential permits under certain circumstances. Specifically, E.O. 11,423 “provides Presidential approval of international bridges in certain cases where the Secretary of State has gathered the necessary information and has concluded—without disagreement from the various departments within the executive branch—that approval is warranted.” Presidio Bridge, 486 F. Supp. at 296 (emphasis in original). If there is disagreement from the various departments, E.O. 11,423 requires that the President make the final decision. There was no disagreement in this case and, therefore, USDS issued the NITC/DRIC Presidential Permit in conformity with E.O. 11,423. In so doing, USDS exercised discretionary authority committed to the President by law. The question remains whether a final decision, in order to be presidential and unreviewable under the APA, must be directly made by the President and not by a delegee. Franklin and Dalton, while relevant, do not answer this question.
Several cases have concluded that an agency‘s action on behalf of the President, involving discretionary authority committed to the President, is “presidential” and unreviewable under the APA. Multiple courts, including one in this district, have held that the issuance of presidential permits by USDS for cross-border oil pipelines pursuant to Exec. Order No. 13,337 (which amended E.O. 11,423 in 2004) was unreviewable presidential action. See, e.g., White Earth Nation v. Kerry, No. CV 14-4726 (MJD/LIB), 2015 WL 8483278, at *6-7 (D. Minn. Dec. 9, 2015) (finding that USDS letters interpreting the scope of a presidential permit, just like the issuance of a permit, were not “an agency action reviewable under the APA” because USDS “was carrying out the directives of the President as set forth in [Exec. Order No.] 13337 ....“); Sisseton-Wahpeton Oyate v. U.S. Dep‘t of State, 659 F. Supp. 2d 1071, 1082 (D.S.D. 2009) (holding that USDS actions with respect to a presidential permit were “presidential in nature” and thus unreviewable under APA because “[t]he President is free to delegate some of his powers to the heads of executive departments, as he has done here, and those delegation actions that are carried out create a presumption of being as those of the President“); Natural Resources Defense Council v. U.S. Dep‘t of State, 658 F. Supp. 2d 105, 109 (D.D.C. 2009) (NRDC) (holding that a USDS decision to issue a presidential permit was unreviewable presidential action because USDS was acting on behalf of the President and in accordance with his directives).
Since White Earth, Sisseton-Wahpeton, and NRDC involved permitting for international oil pipelines, an area in which Congress had never chosen to intervene, it was clear that the actions of USDS derived from the President‘s inherent constitutional authority over foreign affairs. DIBC argues that because the cited cases involved USDS authority derived solely from the Constitution and not from Congress, they are inapplicable. To the contrary, the source of the President‘s authority (i.e., the Constitution or a federal statute) is not relevant so long as the authority being exercised is: (1) discretionary (as opposed to ministerial or ceremonial); and (2) specifically vested in the President. NRDC made this clear when it stated,
Unlike ministerial or ceremonial authority, the President‘s exercise of significant discretionary authority over agency decisions constitutes presidential action, which is shielded from judicial review under the APA out of concern for the separation of powers ... Whether the President carries out the final action himself and the manner in which he does so are considerations that certainly bear on whether the President‘s duties are ministerial or discretionary, but there is no reason to think that these considerations alone are determinative ... The determinative consideration is whether “the President‘s authority to direct the [agency] in making policy judgments” is curtailed in any way or whether the President “is required to adhere to the policy decisions” of the agency.
658 F. Supp. 2d at 110-11 (quoting Franklin, 505 U.S. at 799). The import of White Earth, Sisseton-Wahpeton, and NRDC is that the authority of USDS was both discretionary and vested in the President. The Court finds these cases to be applicable, relevant, and instructive. The issuance of the NITC/DRIC permit by USDS also involved the exercise of discretionary authority committed to the President. As a result, it was presidential in nature.
DIBC then asserts that it is “not aware of any case in which an action by an agency exercising a power delegated by Congress was held to be something other than agency action reviewable under the APA.” Mot. for Reconsideration at 30. However, at least two post-Franklin cases stand for this proposition. In Tulare County v. Bush, 185 F. Supp. 2d 18 (D.D.C. 2001), aff‘d on
In Ancient Coin Collectors Guild v. U.S. Customs and Border Protection, 801 F. Supp. 2d 383 (D. Md. 2011), aff‘d, 698 F.3d 171 (4th Cir. 2012).13 In that case, the
Just like USDS‘s actions in White Earth, Sisseton-Wahpeton, NRDC, and Ancient Coin and the Forest Service‘s actions in Tulare County, the issuance of the NITC/DRIC Presidential Permit by the USDS pursuant to E.O. 11,423 and the IBA was unreviewable presidential action because it involved an exercise of discretionary authority committed to the President by law (i.e., Article II of the Constitution and the IBA).14
Contrary to DIBC‘s position, it is not a question of whether the President‘s discretion derives from the Constitution or from congressional delegation. See Dalton, 511 U.S. at 475-76 (“[W]e do not believe the result [concerning the reviewability of presidential action] should be any different when the President‘s discretion derives from a valid statute” or “from the Constitution.“) (citations omitted); see also Mountain States, 306 F.3d at 1136 (explaining that separation of powers concerns vary depending on the limits imposed on a President‘s discretion). Separation of powers concerns exist whenever the President‘s discretion is at stake.
There is nothing ceremonial or ministerial about the duties assigned to the President in the IBA. E.O. 11,423‘s “division of responsibilities [was] merely a device for managing the President‘s decision-making process.” NRDC, 658 F. Supp. 2d at 111. “That the President chose to retain ultimate authority to settle any interagency dispute signals his belief that the issuance of presidential permits is ultimately a presidential action.” Id. “No permit can issue without, at the very least, the President‘s acquiescence, and the President‘s acquiescence is itself an exercise of discretion that constitutes unreviewable presidential action.” Id. (emphasis added); see also E.O. 11,423 § 3.
Moreover, USDS acted on behalf of the President in the realm of foreign affairs. And, “[a]lthough agencies, such as the State Department here, occupy a different ‘constitutional position’ than does the President, when those agencies act on behalf of the President, the separation of powers concerns ordinarily apply with full force—especially in an area as sensitive and complex as foreign affairs.” Ancient Coin, 801 F. Supp. 2d at 403. The decision to build a new international bridge between Detroit and Canada—that is, the determination of whether the NITC/DRIC would serve the national interest—“does not occur in a foreign policy vacuum.” Id. at 404. This may be especially true in this case given the tension between DIBC and the Government of Canada. See generally TAC. Due to the separation of powers at stake here and the absence of an express statement by Congress concerning the availability of
Finally, DIBC‘s insistence that only the President can ever exercise presidential discretionary authority would create unnecessary complications. It would be impracticable to expect the President to make these decisions personally because that is simply not how government works. When the President retains final authority pursuant to the Constitution or a valid statute, such as here, presidential acquiescence constitutes an exercise of discretion that gives effect to the delegee‘s actions. The President, not the delegee, remains responsible. “[J]udicial review of permitting decisions that the President has delegated to the State Department would impose an unconstitutional burden on his power to delegate that the APA does not require, let alone contemplate.” NRDC, 658 F. Supp. 2d at 112. A contrary holding “would create an asymmetry between presidential permits that are reviewed by the President because of interagency disagreement and those that are issued solely by the State Department“—an outcome that “would surely frustrate the President‘s discretion to enact his preferred decision-making process.” Id.
Finally, an unreviewable presidential action must involve the exercise of discretionary authority vested in the President; an agency acting on behalf of the President is not sufficient by itself. Since the Constitution vests the powers of the Executive Branch in one unitary chief executive officer, i.e., the President, an agency always acts on behalf of the President. Nonetheless, there is a difference between actions involving discretionary authority delegated by Congress to the President and actions involving authority delegated by Congress to an agency. Courts lack jurisdiction to review an APA challenge in the former circumstances, regardless of whether the President or the agency takes the final action. However, “[w]hen the challenge is to an action delegated to an agency head but directed by the President, a different situation obtains: then, the President effectively has stepped into the shoes of an agency head, and the review provisions usually applicable to that agency‘s action should govern.” Elena Kagan, Presidential Administration, 114 Harv. L. Rev. 2245, 2351 (2001). “Nothing in Franklin‘s interpretation of the APA or in its—or any other case‘s—underlying discussion of separation of powers issues is to the contrary.” Id.15
In this case, Congress has long since delegated authority to approve international bridges to the President but not USDS. Had Congress intended to ensure the reviewability of permit approvals, it could have delegated the authority directly to Department and not to the President. Congress knew how to do this, which is why it directly delegated to USDS the authority to approve crossing agreements under
By delegating the authority to the President, as opposed to USDS, Congress recognized the importance of the President‘s role in the process and made a conscious decision to defer to the President‘s discretion and decision-making “given the foreign policy considerations inherent in deciding whether to [approve the construction and maintenance of a new international bridge].” Ancient Coin, 801 F. Supp. 2d at 404 (“Furthermore, by lodging primary responsibility for imposing cultural property import restrictions with the President, rather than with an agency, Congress likely recognized these separation-of-powers concerns.“).
To the extent that there is a concern “that an agency could theoretically shield itself from judicial review under the APA for any action by arguing that it was ‘Presidential,’ no matter how far removed from the decision the President actually was,” see Protect Our Communities, 2014 WL 1289444, at *6, Congress is fully capable of preventing such a result. “[B]road delegations often follow inevitably from both the complexity of modern government and the difficulty of collective bodies in reaching agreements on specifics.” Kagan, supra at 2352. Nonetheless, “enhanced presidential control of administration may make Congress deliberate more carefully about the necessity of broad delegations--and even more, may make Congress hesitate before resorting to broad delegations as a mechanism for punting on difficult decisions.” Id. Count 6 shall remain dismissed for lack of jurisdiction.
4. Alternative Reasons to Sustain Dismissal of Count 6
The APA does not apply when the challenged “agency action is committed to agency discretion by law.”
In granting the NITC/DRIC Presidential Permit, USDS exercised authority committed to its discretion by the President in E.O. 11,423. Excluding this type of action from APA review is particularly necessary since it involved agency action on behalf of the President in the realm of
Given the broad discretion afforded to the President in the IBA and to the Secretary of State in E.O. 11,423, this Court cannot review the issuance of the NITC/DRIC Presidential Permit under the APA‘s arbitrary and capricious standard. There is simply “no law to apply.” Legal Assistance for Vietnamese Asylum Seekers v. Dep‘t of State, Bureau of Consular Affairs, 104 F.3d 1349, 1353 (D.C. Cir. 1997) (“[A]gency action is deemed to be committed to agency discretion when ‘statutes are drawn in such broad terms that in a given case there is no law to apply.’ “) (quotation omitted). Even if there were law to apply, the action of USDS on presidential delegation in the realm of foreign affairs and national interest would necessarily implicate the “Executive‘s determinations ... [and] judgments on questions of foreign policy and national interest,” which “are not subjects fit for judicial involvement.” Dist. No. 1, Pac. Coast Dist., Marine Engineers’ Beneficial Ass‘n v. Mar. Admin., 215 F.3d 37, 42 (D.C. Cir. 2000); see also Nat‘l Fed‘n of Fed. Employees v. United States, 905 F.2d 400, 405 (D.C. Cir. 1990) (“[T]he problem is not that the Act is devoid of criteria ... [it] sets forth nine specific criteria to be considered in making base closing decisions. Rather the rub is that the subject matter of those criteria is not ‘judicially manageable.’ “). Therefore, even if the issuance of the NITC/DRIC Presidential Permit were not presidential in nature, it would not be reviewable under the APA because it was an action “committed to agency discretion by law.”
DIBC also alleges that the issuance of the NITC/DRIC Presidential Permit was contrary to law in violation of the APA. Specifically, it argues that the IBA required the President to “determine the necessity of [the proposed] bridge,” see
USDS did consider the “purpose and need for the [NITC/DRIC].” Record of Decision [Dkt. 233-25] at 7 (emphasis added); see id. at 7-9. USDS explained in its unopposed proposed determination: “The stated purpose of the NITC project is to support the regional, state, provincial, and national economies of both countries while addressing the civil and national defense and homeland security needs of the busiest commercial corridor between the U.S. and Canada.” Id. at 7.17
DIBC continuously refers to “necessity” in terms of economic viability and feasibility. See TAC ¶ 343 (alleging “there is no need for a new bridge crossing between Detroit and Windsor” in light of DIBC‘s plans and ability to serve the demand for cross-border traffic). DIBC argues on reconsideration that “even though the IBA calls for the Government to assess the ‘necessity’ of any new bridge such as the NITC/DRIC, the perfunctory necessity determination conducted for the NITC/DRIC totally ignored the most important factor of all: the Plaintiffs’ desire to build their Twin Span, which would render the NITC/DRIC completely unnecessary.” Mot. for Reconsideration at 15 (emphasis in original). Hidden in this argument is DIBC‘s exclusivity proposition—that the Government could not approve any other bridge in the area that could compete with the Ambassador Bridge and frustrate DIBC‘s plans.
The argument posits a narrow definition of necessity that is unsupported by the text or legislative history. The term “necessity” may encompass many different interests and definitions. It is the President‘s prerogative to define “necessity” and whether to do so in broad or narrow terms. The President chose a broad standard—“that issuance of a permit to the applicant would serve national interest.” E.O. 11,423, § 1(d). In light of the facts that the IBA “was the product of the same arm of the government that issued [E.O. 11,423], and was passed by a Congress that was well aware of ... the provisions in that Order and the reason for its existence,” it follows that “the two documents are thus compatible with, and companions to, one another” and the President intended a broad standard to be applied under the authority delegated by Congress in the IBA. Presidio Bridge, 486 F. Supp. at 296 (“[I]f the prerequisites detailed in Executive Order 11,423 are satisfied, the permit has presidential approval as contemplated by
Finally, with respect to the remaining allegations giving rise to Count 6, DIBC alleges, inter alia, that the NITC/DRIC Presidential Permit violated the APA because the proposed construction of the NITC/DRIC would destroy any statutory, treaty, or franchise rights that DIBC may have with respect to the Ambassador Bridge and the proposed Twin Span. See TAC ¶¶ 342-50. The claims that the proposed construction of the NITC/DRIC affects these rights have been dismissed. Count 6 will remain dismissed.
D. Count 9—Equal Protection Clause
DIBC seeks reconsideration of the dismissal of Count 9 for two reasons: (1) the Court “relied on a factual finding that was inaccurate;” and (2) “it is not clear that the Court considered the central legal proposition on which Plaintiffs are relying.” Mot. for Reconsideration at 36. It is true that the Court briefly mentioned in its September 30, 2015 Memorandum Opinion that “the proponents of the NITC/DRIC have not yet submitted an application for a navigation permit to the [Coast Guard].” Mem. Op. at 55. That statement did not recognize that the Coast Guard received the NITC/DRIC application for a navigation permit in October 2013 and issued a permit to NITC/DRIC on May 30, 2014. See Mot. for Reconsideration, Ex. 26 [Dkt. 233-28] (NITC/DRIC Navigation Permit); see also Opp‘n at 22-23 n.11 (recognizing
at 476, 114 S.Ct. 1719 (citations omitted). While DIBC argues that the permitting process must be subject to some kind of judicial review, “[t]he judicial power of the United States conferred by Article III of the Constitution is upheld just as surely by withholding judicial relief where Congress has permissibly foreclosed it, as it is by granting such relief where authorized by the Constitution or by statute.” Id. at 477.
Federal Defendants’ “oversight in failing to go back and specifically correct the statement” once counsel “became aware of the submission of the Coast Guard permit” application). This factual error is not sufficient for the Court to reconsider its dismissal.
The Court did not rely exclusively on this factual finding when it dismissed DIBC‘s equal protection claim. The Court also noted the insufficiency of DIBC‘s factual allegations to support a claim of differential treatment. See Mem. Op. at 55 (stating that “the allegations on which [DIBC] rel[ies] do not mention the NITC/DRIC proponents, much less articulate how [the Coast Guard] has afforded them more favorable treatment.“); see also id. at 56-57. In an attempt to cure the insufficiency of TAC‘s allegations, DIBC now points to “doubts” that should have precluded the Coast Guard from issuing the NITC/DRIC navigation permit—e.g., the legality of the NITC/DRIC, the legality of the Crossing Agreement, the questionable exercise of eminent domain in Michigan, and the economic infeasibility of having a public bridge close to the Ambassador Bridge and the proposed Twin Span. See Mot. for Reconsideration at 37-38. However, none of these “doubts” is relevant to the Coast Guard‘s regulations regarding navigation permits. Moreover, unlike DIBC‘s proposed Twin Span, the NITC/DRIC did not face the same obstacle precluding issuance of a navigation permit, which was DIBC‘s failure to secure necessary property rights to build the Twin Span—specifically, air rights over land owned by the City of Detroit.20 Conse-
DIBC argues that the Court ignored the “central legal proposition” of its Equal Protection claim: “when a government entity decides to enter the marketplace and compete with the private sector, then any government entity that acts as a regulator of that marketplace must treat the government-participant the same as it treats the private-sector participants.” Mot. for Reconsideration at 38-39.21 This argument does not overcome the Court‘s finding that NITC/DRIC‘s proponents and DIBC were not similarly situated and that TAC‘s allegations were insufficient to show differential treatment. See Mem. Op. at 54-57. Both bridges involve independent proposals that were subject to different regulatory approvals and different requirements. See id. at 54-55. In some instances, different agencies reviewed the proposed projects. See id. at 55. Aside from general allegations concerning Federal Defendants’ efforts to expedite review of the NITC/DRIC and delay the Twin Span ap-
provals, the TAC is devoid of allegations showing that both bridges faced similar obstacles and were treated differently. See id. at 57 (“Plaintiff‘s claim that the regulatory approval for the Twin Span should have been straightforward given that the Twin Span does not require an IBA Bridge Permit and does not pose any navigational or environmental problems ... is a conclusory law opinion, [Bell Atlantic Corp. v.] Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007), and contrary to this Court‘s dismissal of Count 4 against [the Coast Guard.]“) (internal quotation marks and quotation omitted). DIBC‘s legal proposition cannot transform its “bare complaints of governmental unfairness” into a cognizable equal protection claim. Quezada v. Marshall, 915 F. Supp. 2d 129, 135 (D.D.C. 2013).
Finally, it is well-established that “[t]he state has broad authority and discretion in the regulation of economic affairs.” Llewellyn v. Crothers, 765 F.2d 769, 775 (9th Cir. 1985) (Kennedy, J.) (citing Williamson v. Lee Optical of Oklahoma, Inc., 348 U.S. 483, 75 S.Ct. 461, 99 L.Ed. 563 (1955)). This proposition is particularly forceful in a “class-of-one” case such as this one, in which DIBC is not a member of a suspect class and must allege sufficient facts to show that it was “intentionally treated differently from others similarly situated and that there [was] no rational basis for the difference in treatment.” Vill. of Willowbrook v. Olech, 528 U.S. 562, 564, 120 S.Ct. 1073, 145 L.Ed.2d 1060 (2000)
Mere disagreement with the wisdom of the proffered reasons, see Record of Decision at 7-9 and TAC ¶¶ 216-241, is not sufficient to support a claim that Federal Defendants actions were not rationally related to a legitimate governmental purpose. See Romer v. Evans, 517 U.S. 620, 632, 116 S.Ct. 1620, 134 L.Ed.2d 855 (1996) (citations omitted) (“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.“). The prospect that NITC/DRIC, unlike DIBC‘s Twin Span, would further U.S.-Canada relations could be, alone, a rational justification. See Record of Decision at 7 (explaining how NITC/DRIC could improve relations with Canada); see also TAC ¶ 13 (alleging that Canada has expressed a “longstanding desire ... to eliminate private ownership of the Detroit-Windsor bridge crossing ....“). The promotion of national security, creation of additional jobs, and competition for cross-border traffic are additional reasons for the alleged differential treatment. See Giacalone v. Wehner, 387 F. Supp. 2d 383, 385 (S.D.N.Y. 2005) (quoting Heller v. Doe, 509 U.S. 312, 320-321, 113 S.Ct. 2637, 125 L.Ed.2d 257 (1993)) (“‘The burden is on the plaintiff to disprove every conceivable basis which might support the classification, ‘whether or not the basis has a foundation in the record.’ “). No equal protection claim was properly stated. Count 9 will remain dismissed.
III. CONCLUSION
For the foregoing reasons, the Court will deny DIBC‘s Motion for Partial Reconsideration [Dkt. 233]. Although the Court has amended and expanded upon some of the reasoning and findings articulated in its previous Memorandum Opinion, the Court‘s September 30, 2015 Order will be left undisturbed and Counts 2, 3, 6, and 9 will remain dismissed.
Alvin GASKINS, Plaintiff, v. UNITED STATES of America, Defendant.
Civil No. 14-cv-01208 (APM)
United States District Court, District of Columbia.
Signed May 26, 2016