Mexican Gulf Fishing Company v. U.S. Department of CommerceMexican Gulf Fishing Company v. U.S. Department of Commerce
Before the Court are cross motions for summary judgment.1 Plaintiffs Billy Wells; Mexican Gulf Shipping Co.; Allen Walburn; A&B Charters, Inc.; Kraig Dafcik; Joseph Dobin; Joey D. Charters; Frank Ventimiglia; Ventimiglia Charters; Jim Rinckey; and Fishing Charters of Naples (collectively, “Plaintiffs”) filed a motion for summary judgment.2 Defendants the U.S. Department of Commerce, the National Oceanic and Atmospheric Administration, the National Marine Fisheries Service, and their respective heads in their official capacities (collectively, the “Government”) have filed a combined opposition and cross motion for summary judgment.3 Plaintiffs filed a combined opposition to the Government’s motion and reply in support of their own motion.4 The Government filed a reply in support of their motion.5 Having considered the briefs, the record, and the applicable law, the Court now issues its ruling.
Plaintiffs are a group of charter boat captains and owners who take clients fishing in the Gulf of Mexico.6 Defendants are various federal government agencies and officials, including the United States Department of Commerce (“USDOC”), the National Oceanic and Atmospheric Administration (“NOAA”), and the National Marine Fisheries Service (“NMFS”).7 USDOC is the primary agency responsible for domestic marine fisheries in federal waters and has delegated this responsibility to NOAA.8 NOAA has subdelegated those responsibilities to NMFS.9
On July 21, 2020, the Government published a Final Rule requiring Gulf for-hire vessel owners and operators to submit electronic fishing reports “prior to removing any fish from the vessel” or “[i]f no fish were retained by any person on the vessel during a trip, . . . within 30 minutes of the completion of the trip” and to submit the fishing report “via NMFS approved hardware and software, as posted on the NMFS Southeast Region website.”10 These reports must contain “all fish harvested and discarded, and any other information requested.”11 While the regulatory text does not define this “other information,” the preamble in the Final Rule explains NMFS will require “information about the permit holder, vessel, location fished, fishing effort, discards, and socio-economic data,” specifically including “five economic values per trip: The charter fee, the fuel price and estimated amount of fuel used, number of paying passengers, and the
On June 2, 2021, the Court certified a class action for Gulf For-hire vessel charter boat owners and operators who are permitted to fish by the Fishery Management Councils of the Gulf of Mexico and South Atlantic and are harmed by the Final Rule.18 The parties have now filed cross motions for summary judgment on all claims.19
LEGAL STANDARD
When presented with a motion for summary judgment, a court normally considers whether the record, “’viewed in the light most favorable to the non-moving party,’ evinces
Nevertheless, summary judgment “remains ‘an appropriate procedure for resolving a challenge to a federal agency‘s administrative decision when review is based on the administrative record.’”24 When reviewing an administrative agency‘s decision on summary judgment, the district court must “determine whether as a matter of law, evidence in the administrative record permitted the agency to make the decision it did, and summary judgment is an appropriate mechanism for deciding the legal question of whether an agency could reasonably have found the facts as it did.”25 Under the Administrative Procedure Act (“APA”), a court will set aside or otherwise disturb non-adjudicatory agency action if the party pursuing judicial review shows that the agency
UNDISPUTED MATERIAL FACTS
The facts of this case by and large come from the administrative record, which the Government has filed into the Court’s record in its entirety.29 The parties do not dispute the facts contained in the administrative record. Any other factual disputes are noted below.
The Magnuson-Stevens Fishery Conservation and Management Act (“MSA”) establishes a national program for conservation and management of fishery resources with federal jurisdiction over such resources within the exclusive economic zone, which extends from the seaward boundary of each coastal State out to 200 nautical miles.30 Key purposes of the MSA are to “conserve and manage the fishery resources found off the coasts of the United States” and “promote domestic commercial and recreational fishing under sound conservation and management principles.”31 Congress has recognized that “[t]he collection of reliable data is essential to the effective conservation, management, and scientific understanding of the fishery resources of the United States.”32
The NMFS, acting under authority delegated from the Secretary of Commerce, is responsible for managing fisheries pursuant to the MSA. Regulation of fisheries is accomplished through fishery management plans and amendments to those plans (hereinafter, collectively referred to as “FMPs”) as well as implementing regulations.33 The MSA sets forth required provisions for FMPs, including that they must contain measures “necessary and appropriate for the conservation and management of the fishery, to prevent overfishing and rebuild overfished stocks, and to protect, restore, and promote the long-term health and stability of the fishery.”34 To address overfishing, FMPs must establish mechanisms for annual catch limits and accountability measures.35
To assist in fishery management, the MSA established eight Regional Fishery Management Councils, each of which is granted authority over a specific geographic region within the exclusive economic zone and is composed of members who represent the interests of the states included in that region.41 Each Council is required to prepare
II. Gulf Council FMP Amendment
Between 2014 and 2017, the Gulf of Mexico Fishery Management Council (“Gulf Council”) prepared an amendment to the Fishery Management Plans for Reef Fish Resources of the Gulf of Mexico and Coastal Migratory Pelagic Resources in the Gulf of Mexico and Atlantic Region.47 The amendment modifies reporting requirements for vessels issued Gulf of Mexico charter vessel/headboat permits.48
The Gulf Council found that “[a]ccurate information about catch, effort, and discards is necessary to achieve [optimum yield] from federally managed fish stocks,” and recognized that improved data reporting for Gulf fisheries could “reduce the likelihood that annual catch limits are exceeded and accountability measures are triggered.”55 The Gulf Council also found that the collection of additional data elements using electronic reporting could “improve estimates of bycatch and discard mortality rates.”56 The Gulf Council imposed three requirements to aid in validation and compliance: reporting of
III. Notice of Proposed Rulemaking
On May 23, 2017, the Gulf Council transmitted the amendment to NMFS for implementation according to the MSA’s procedures.58 On June 21, 2018, NMFS published a notice of availability in the Federal Register describing the amendment and providing notice that NMFS would evaluate the amendment for consistency with the FMPs, the MSA, and other applicable laws.59 In the notice of availability, NMFS sought public comments on the amendment though August 20, 2018, which would be considered in the decision whether to approve the amendment and addressed in the Final Rule.60 On September 19, 2018, NMFS notified the Gulf Council of the amendment’s approval.61
On October 26, 2018, NMFS published a notice of proposed rulemaking implementing the amendment and proposing to collect information from “for-hire” charter boats and headboats in the Gulf of Mexico.62 The proposed rule would have first required charter boats to “submit an electronic fishing report for each trip before offloading fish from the vessel, or within 30 minutes after the end of each trip if no fish were landed.”63 The fishing report must be sent electronically to the Science and Research
The proposed rule also would have required charter boats to “have NMFS-approved hardware and software with GPS capabilities that, at a minimum, archive vessel position data during a trip for subsequent transmission to NMFS, which could include sending data through a cellular or satellite-based service”67 The vessel‘s location tracking device “would have to be permanently affixed to the vessel” and “have uninterrupted power, unless the owner or operator applies for and is granted a power-down exemption.”68 Finally, the proposed rule also would have required “an owner or operator of a federally permitted charter vessel or headboat to submit a trip notification to NMFS before departing for any trip,” indicating “whether the vessel is departing on a for-hire trip or another type of trip” and, if it was a for-hire trip, “the expected trip completion date, time, and landing location.”69
The notice of proposed rulemaking contained initial regulatory flexibility analysis under the Regulatory Flexibility Act.70 The notice of proposed rulemaking provided for a
IV. Final Rule
On July 21, 2020, NMFS published the Final Rule, which adopted the electronic-fishing-report and tracking requirements as proposed.72 Owners or operators of charter vessels are subject to the Final Rule only if they have a limited-access permit for Gulf reef fish or coastal migratory pelagic fish.73 The Final Rule contains three components. First, the final rule requires a Gulf for-hire vessel owner or operator to notify NMFS prior to departing for any trip and declare whether they are departing on a for-hire trip or on another trip type.74 Second, an owner or operator of a vessel with a Federal charter vessel/headboat permit for Gulf reef fish or Gulf coastal migratory pelagic species must submit an electronic fishing report (also referred to as a logbook), via NMFS-approved hardware and software, for each fishing trip before offloading fish from that fishing trip.75 Third, the final rule requires that a Gulf for-hire vessel owner or operator use NMFS-approved hardware and software with global positioning system location capabilities that, at a minimum, archive vessel position data during a trip for subsequent transmission to NMFS.76
First, the Final Rule requires owners or operators of a vessel for which a charter vessel/headboat permit for Gulf reef fish or coastal migratory pelagic fish has been issued to notify NMFS before it departs for a trip and declare whether the vessel will be operating as a charter vessel or headboat, or another type of trip.77 The trip declaration aids port agents in knowing when and where a trip will end for sampling.78 NMFS expects the trip declaration requirement to make it easier to track landings in a timely manner and reduce uncertainty in the data.79
B. Electronic Reporting Requirement
Second, if the vessel is operating as a charter vessel or headboat, then an electronic fishing report must be submitted prior to removing any fish from the vessel, or, if no fish are landed, within 30 minutes of arriving at the dock.80 As in the proposed rule, the Final Rule stated the “electronic fishing report must include any species that were caught or harvested in or from any area . . . as well as information about the permit holder, vessel, location fished, fishing effort, discards, and socio-economic data”; however, the Final Rule further explained, in response to a comment, that “NMFS will require the reporting of five economic values per trip: The charter fee, the fuel price and estimated amount of fuel used, number of paying passengers, and the number of crew for each trip.”81
Some commenters objected to “reporting of economic information” in electronic fishing reports.82 These commenters claimed that “[r]equiring operators to submit their
C. Tracking Requirement
Third, each permitted vessel must be equipped with NMFS-approved hardware and software with a minimum capability of archiving GPS locations (i.e., satellite or cellular VMS) once per hour, 24 hours a day, every day of the year.88 Cellular-based systems collect and store data while a vessel is not within range of a cellular signal and
Several commenters objected to the GPS requirement, raising Fourth Amendment concerns:
Providing all confidential transiting details is a violation of our 4th Amendment right to privacy and not necessary to manage the fishery. Such details are considered confidential by NOAA and utilized by other agencies not associated with management of the fishery. This is a dangerous precedent. Fish have tails, they move and with the climatic shift and movement of our fish into new areas over the last several years utilizing such historical data for fishery management purposes is flawed and can be misused to deny us access to the fishery. Therefore, to require detailed GPS data for vessels utilized by the for hire community is not necessary for fishery management purposes, flawed if used for fishery management purposes due to the climatic shift of our stocks and is also a violation of our 4th Amendment rights.94
NMFS will protect these data in accordance with applicable law. For example, under section 402(b)(1) of the Magnuson-Stevens Act, the data submitted to NMFS under the Gulf For-hire Reporting Amendment shall be confidential and shall not be disclosed, except under the limited circumstances specified in the Magnuson-Stevens Act, such as to Council or Federal employees who are responsible for fishery management. As noted in 50 CFR 600.415(e), anyone “having access to these data are prohibited from unauthorized use or disclosure and are subject to the provisions of 18 U.S.C. 1905, 16 U.S.C. 1857, and NOAA/NMFS internal procedures, including NAO 216-100.” Additionally, all data reported through the Gulf for-hire reporting program will be collected through software that meets standards set out by NMFS, including data confidentiality and protection of personal information online, and will be treated as confidential in accordance with NOAA Administrative Order 216-100, Protection of Confidential Fisheries Statistics. The release of data in aggregate or summary form that does not directly or indirectly disclose the identity or business of any person who submits the information is authorized under section 402(b)(3) of the Magnuson-Stevens Act.95
Other commenters expressed concerns that 24-hour GPS surveillance was unnecessary and unduly burdensome;96 that it was unnecessary and inappropriate to subject charters boats to the same tracking requirements as commercial fishing vessels;97 and that the financial cost of purchasing, installing, and operating GPS-tracking VMS
The Gulf for-hire reporting program is designed to both monitor for-hire landings to determine in-season closures and post-season quota adjustments, and to enhance data collection efforts to provide for better fisheries management, such as through more data-rich stock assessments. As such, collection of these data is not a research tool but a management tool for the reef fish and CMP fisheries, and responsibility for the program is appropriately shared by NMFS and the fishermen. The fishermen are required to have the necessary equipment and report in a timely manner as conditions of their Federal for-hire permits because they possess the information that the Gulf Council and NMFS need to improve management. NMFS is responsible for performing quality control, validating the reports, and using the data, as appropriate, to help achieve various management objectives.
. . . .
The Gulf Council chose to require a trip declaration and vessel location tracking device to validate effort (fishing trips). These requirements will allow NMFS to determine when a fishing trip was taken, and the length of that trip.
. . . .
[R]equiring each Gulf for-hire vessel be equipped, at a minimum, with archivable vessel location tracking (cellular VMS) best balances the need to collect and report timely information with the need to minimize the cost and time burden to the industry. The vessel location tracking system is an additional mechanism that verifies vessel activity without a report having to be completed by the vessel operators. The vessel location tracking system will allow NMFS to independently determine whether the vessel leaves the dock. This will help validate effort and aid with enforcement of the reporting requirements.99
NMFS also provided further information about the cost of the tracking requirement, including reimbursements available from NMFS:
NMFS is currently testing six cellular-based units that range in purchase price from $150 to $800. The monthly service fee for these units range from $10 to $40 per month. The unit vendor determines these costs. The NMFS VMS re-imbursement program is available to fishermen for the purchase of approved satellite-based VMS units, and NMFS OLE is undergoing rulemaking that would also make reimbursement available for cellular-based VMS units. Satellite-based VMS that are currently approved for the commercial Gulf reef fish program cost approximately $3,000 per unit. Monthly service fees, which NMFS expects to range from approximately $40 to $75, will be the responsibility of the fisherman.
. . . .
NMFS understands there will be additional costs to vessel operators to pay for data collection. NMFS also acknowledges that charter and headboat businesses may have substantial loan payments and other operating costs, such as insurance, overhead, maintenance, and trip costs (e.g., fuel, labor, supplies, etc.), that affect both their net income and cash flow. . . . According to the best scientific information available, which includes a 2012 study published by the Center for Natural Resource Economics and Policy, Louisiana State University, average monthly cash outflows (fixed and variable costs) for charter and headboat businesses are estimated to be approximately $5,171 (2018 dollars) and $15,758, respectively. In comparison to existing costs, NMFS believes the ongoing monthly fee (estimated at $10 to $40 per month) would not materially alter cash flows, profits, or the solvency of for-hire businesses.100
NMFS explained how it came to these cost estimates:
[E]xamples of costs borne by the for-hire fleet may include the purchase and installation costs of the approved hardware units and associated service charges. In the proposed rule, NMFS presented cost estimates to the for-hire industry for several general options including a tablet-based system, a handheld GPS, and a smartphone-based system, where the smartphone is hardwired to a vessel‘s GPS. These cost estimates have been updated since the proposed rule published and are now based on vendor quotes for six different cellular-based location tracking devices selected for testing by NMFS. If a vessel does not already have an approved type of hardware (e.g., an approved VMS unit), the estimated startup costs for each affected vessel will range from $150 to $800 in the year of implementation. At the top end of this range, these costs are equivalent to 1 percent of average annual headboat net income and 3.1 percent of average annual charter vessel net income. The recurring monthly cost per vessel to use the location tracking device is estimated to be $10 to $40. On an annual basis, these reoccurring
charges will be equivalent to up to 0.6 percent of average annual headboat net income and 1.8 percent of average annual charter vessel net income. Some of the cellular-based location tracking devices will allow users to enter and transmit electronic fishing reports in addition to recording and transmitting GPS coordinates. Other devices will only be capable of recording and transmitting GPS coordinates. Therefore, depending on the location tracking device selected for use, a separate mobile device, such as a smartphone, and wireless service plan may be required to submit fishing reports. Some vessel owners and operators may be more or less affected than others by this final rule depending on their existing technology assets and data service plans at the time of implementation, the location tracking device that they select, and the availability of wireless service coverage at their port of landing. For the affected vessels that currently do not have any wireless carrier contract and who select a location tracking device that does not support fishing report submission, the estimated additional cost for an unlimited data plan will range from approximately $60 to $85 per month. This is an upper bound estimate based on advertised rates from four major wireless service providers in 2019 and cheaper plans may be available. A basic smartphone may be purchased for as low as $100 and some providers bundle free phones with their service plans. NMFS assumes that most owners or operators of for-hire vessels already have a basic smartphone and data plan in order to meet the needs of their businesses. NMFS also assumes that owners and operators of for-hire vessels will choose a combination of technology that best satisfies their profit maximization strategies, while meeting the requirements of this final rule.101
Finally, NMFS explained the alternatives considered before settling on the current tracking requirement, including the alternative of not requiring GPS tracking:
The first alternative, the no-action alternative, would not change current reporting requirements for for-hire vessels. Therefore, it would not be expected to result in any direct economic effects on any small entities. This alternative was not selected by the Gulf Council because there is currently no reporting platform for charter vessels, and therefore, no means by which charter vessels would be able to submit electronic reports. Additionally, this alternative would not allow for the same level of trip validation, because it would not require GPS unit hardware to be permanently affixed to the vessel.
The second alternative and two options were selected as preferred and require charter vessel and headboat owners or operators to submit fishing reports via NMFS-approved hardware and software. Under this preferred alternative and options, a for-hire vessel owner or operator is also required to use NMFS-approved hardware and software with GPS location
capabilities that, at a minimum, archive vessel position data during a trip. The cellular or satellite VMS needs to be permanently affixed to the vessel.
The third alternative would require for-hire vessel owners or operators to submit fishing reports via NMFS-approved hardware and software with GPS location capabilities that, at a minimum, provide real-time vessel position data to NMFS. The cellular or satellite VMS would need to be permanently affixed to the vessel. The third alternative contained two options. The first and second options would require federally permitted charter vessels and headboats, respectively, to comply with the hardware and software requirements of the third alternative. The startup costs, as presented in the proposed rule, for each affected for-hire vessel under the third alternative and two options were estimated to be approximately $300 in the year of implementation. The recurring annual service cost associated with the transmission of real-time location data in subsequent years was estimated to be approximately $200 per vessel. Since the proposed rule published, NMFS has received several vendor price quotes and has updated the technology cost estimates associated with this final rule. Therefore, NMFS cannot make a direct comparison with the hypothetical cost estimates of this alternative. In the proposed rule, the recurring costs for this alternative were estimated to be higher than for the preferred alternative. If comparable cost estimates were available, NMFS assumes the third alternative, which would require real-time transmission of GPS location coordinates (satellite VMS), would still be more expensive than the archival GPS units (cellular VMS) allowed by this final rule. As discussed earlier, depending on the device that is used for location tracking, a separate mobile device, such as a smartphone, and wireless service plan would potentially be required to submit electronic fishing reports as well. This could result in an additional expense in the range of $60 to $85 per month. The third alternative was not selected by the Gulf Council because it was expected to result in higher costs to industry.
The fourth alternative would require for-hire vessel owners or operators to submit fishing reports via NMFS-approved hardware and software that provide real-time vessel position data to NMFS via satellite VMS. The antenna and junction box would need to be permanently affixed to the vessel. The fourth alternative contained two options. The first and second options would require federally permitted charter vessels and headboats, respectively, to comply with the hardware and software requirements of the fourth alternative. The estimated startup costs for each affected vessel to purchase, install, and operate a satellite VMS unit would range from $2,500 to $4,400 in the year of implementation. This would be equivalent to approximately 10 to 17 percent of average annual charter vessel net income and 3 to 6 percent of average annual headboat net income. The recurring annual cost associated with maintaining and operating satellite VMS hardware and software in subsequent years was estimated to be approximately $750 per vessel. The fourth alternative was not selected by
The Final Rule conducted a regulatory flexibility analysis of the economic impact on charter boat operators, all of whom were recognized to be small businesses under the
LAW AND ANALYSIS
I. Challenges to the Electronic Reporting Requirement
A. The Reporting of Five Specific Socio-economic Factors Is a Logical Outgrowth of the Proposed Rule.
Under the APA, an agency must publish notice of the legal authority for a proposed rule and of the rule‘s substance or subject matter, and the agency must also provide an opportunity for interested persons to participate in the rulemaking.104 Notice suffices if the final rule “is a ‘logical outgrowth’ of the proposed rule, meaning the notice must ‘adequately frame the subjects for discussion’ such that ‘the affected party “should have anticipated” the agency‘s final course in light of the initial notice.‘”105 “If a party ‘should have anticipated’ that course, it ‘reasonably should have filed [its] comments on the subject during the notice-and-comment period.‘”106 “The objective is fair notice.”107
In this case, Plaintiffs complain they had no notice of NMFS‘s intention to require reporting of the charter fee, the fuel price and estimated amount of fuel used, number of paying passengers, and the number of crew for each trip.108 The proposed regulatory text
However, the preamble in the notice of proposed rulemaking stated that fishing reports must include information regarding “any species that were caught or harvested, . . . as well as information about the permit holder, vessel, location fished, fishing effort, discards, and socio-economic data.”111 The notice of proposed rulemaking did not specifically state what socio-economic data the report would request.112 In the Final Rule, the relevant regulatory text is identical to the proposed regulatory text, including “other information” in the reporting requirement but not specifying what that information would be.113 Similarly, as in the notice of proposed rulemaking, the preamble to the regulatory text in the Final Rule stated the “electronic fishing report must include any species that were caught or harvested in or from any area . . . as well as information about the permit holder, vessel, location fished, fishing effort, discards, and socio-economic data“; however, the Final Rule further explained, in response to a comment, that “NMFS will require the reporting of five economic values per trip: The charter fee, the fuel price and estimated amount of fuel used, number of paying passengers, and the number of crew for each trip.”114
Plaintiffs argue the inclusion of these five economic values violates the APA‘s notice and comment requirement because nothing in the notice of proposed rulemaking
“[N]otice need not specifically identify ‘every precise proposal which [the agency] may ultimately adopt as a rule.‘”118 For example, in United Steelworkers of America, AFL-CIO-CLC v/ Schuylkill Metals Corp., the Fifth Circuit held that a final rule, which did not define the word “earnings,” could logically include “premium payments” for purposes of the APA‘s notice and comment requirement, even though it was not specified in notice of proposed rulemaking.119 In that case, the agency had promulgated a rule requiring employers to continue to pay certain benefits to employees either let go or transferred due to lead exposure.120 Specifically, the final rule provided “the employer shall maintain the earnings, seniority rights and other employment rights and benefits of an employee.”121 After the final rule came into effect, the agency attempted to enforce the final rule against employers who were not providing transferred employees “premium payments,” such as
overtime pay, production bonuses, and shift differential.122 The agency maintained these premiums were covered under the term “earnings” in the final rule, but the employers argued there was no notice during the rulemaking that earnings could include premium payments.123
The notice of proposed rulemaking stated employers should pay benefits that “would maintain the rate of pay, seniority and other rights of an employee” and asked for comments on the extent of these benefits.124 Although neither “earnings” nor a definition of “earnings” was included in the notice, the Fifth Circuit held that the notice‘s “descriptions more than adequately sufficed to apprise fairly an interested party that there was an issue regarding the breadth of . . . benefits,” and the agency‘s request for comments helped further put the parties on notice of the issue.125 “[I]t certainly was not necessary,” the court reasoned, “that the Secretary spell out with particularity the proposed meaning of . . . benefits or ‘earnings.‘”126
The Fifth Circuit also noted that “the comments received reflected . . . an understanding” among interested parties that the scope of benefits was in dispute.127 The agency received one comment that “precisely” addressed the issue,128 asking the agency to enumerate the exact forms of compensation “earnings” covered.129 Other comments advocated more generally for a broad definition of “earnings.”130 The court reasoned these comments further showed “it was readily apparent to interested parties that the scope of
Courts have also found materials referenced in notices of proposed rulemaking may provide further notice of details not specifically laid out in the notice of proposed rulemaking itself.132 For example, in American Coke and Coal Chemicals Institute v. EPA, the D.C. Circuit held that information provided in the agency‘s development document accompanying the notice of proposed rulemaking could help “put parties on notice” of changes the agency might make in the final rule.133 The final rule differed in two relevant ways from the notice of proposed rulemaking. First, the final rule changed the datasets the agency relied on to create a chemical limit: specifically, the final rule added datasets ES01, ES02, and ISM54 and removed dataset ESE03.134 Regarding the dataset the agency ultimately removed, ESE03, the court noted that “the Proposed Development Document accompanying the [notice of proposed rulemaking] [stated] that the model facilities ‘had to demonstrate good operation of the treatment component.‘”135 Therefore, “[a]lthough the preamble in the [notice of proposed rulemaking] did not state that [agency] intended to reconsider the use of data from episode ESE03, nor that the ESE03 site would be reviewed for compliance with the general criteria of ‘good operation,‘” the development document provided “notice that data deriving from any plants that failed to demonstrate ‘good operation’ would not be considered sources of information.”136 This development
The second change the D.C. Circuit considered in American Coke was the use of a median flow rate to set standards in the notice of proposed rulemaking to the use a flow rate from the “best performing mills” in the final rule.139 The court again looked to the proposed development document, noting that “the Proposed Development Document put parties on notice that EPA‘s flow rate would be based upon ‘better performing mills.‘”140 The development document thus “put commentators on notice that EPA was considering an alternative to the ‘industry median.‘”141
In this case, the notice of proposed rulemaking and the Final Rule consistently explained the rule would require the reporting of “socio-economic data.”142 “Socio-economic” is defined by Merriam-Webster to be “of, relating to, or involving a combination of social and economic factors.”143 Similarly, the Oxford English Dictionary defines “socio-economic” as “[s]ocial and economic; that derives from or is concerned
Although Plaintiffs argue “socio-economic” is too broad a word to put anyone on notice of the required economic reporting, this case is similar to United Steelworkers, which concerned the definition of “earnings“—a word the Fifth Circuit described as more “a term of art that has no natural, immutable meaning.”146 Although the notice of proposed rulemaking did not include the word “earnings” or attempt to define its scope, the Fifth Circuit held that the notice‘s broad descriptions of “rate of pay” and “other rights” “more than adequately sufficed to apprise fairly an interested party that there was an issue regarding the breadth of . . . benefits.”147 Although “socio-economic” may be broad, as the Fifth Circuit stated, “it certainly was not necessary that the [NMFS] spell out with particularity the proposed meaning of” the word.148
Furthermore, as in United Steelworkers, the NMFS sought comments on the scope of the electronic reporting requirement, asking “whether this proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility.”149 The comments submitted to NMFS in response to the notice of proposed rulemaking show that interested parties understood the potential scope of “socio-economic” data reporting and were able to have
The amount I charge someone to go fishing on my vessel has nothing to do with the fishery as a whole or how much I paid for fuel. Let us try and make a living without prying into our personal business. Stick with fish populations and do away with the economists.157
The Ocean Conservancy filed a similar comment to the one above during this comment period, again asking that fishermen be “able to retrieve information from their fishing trips such as . . . economic data.”158 All of these comments were enough for NMFS to respond to them in the Final Rule.159 NMFS summarized these concerns into Comment 15:
NMFS should not require reporting of economic information. Requiring operators to submit their financial information leads to a lack of buy-in and trust among participants. There are other methods to collect this information such as surveying websites, directly surveying permit holders, or simply asking the question on a random basis rather than for every trip.
Notice was further provided through reference in the notice of proposed rulemaking to the Gulf Council‘s amendment. The summary of the notice of proposed rulemaking noted, “NMFS proposes to implement management measures described in the Gulf For-hire Electronic Reporting Amendment, as prepared and submitted by the Gulf of Mexico (Gulf) Fishery Management Council (Gulf Council).”160 When providing an overview of the electronic reporting requirement, the notice of proposed remaking specified it was considering implementing the reporting requirement as “described in the Gulf For-hire Reporting Amendment.”161 The notice directed readers to copies of the amendment: “Electronic copies of the Gulf For-hire Reporting Amendment may be obtained from www.regulations.gov or the Southeast Regional Office website at http://sero.nmfs.noaa.gov/sustainable_fisheries/gulf_fisheries/For-HireElectronicReporting/index.html.”162 The amendment includes the September 2016 report from the Technical Data Committee, which discusses “the recommended data elements that are
Accordingly, based on the information in the notice of proposed rulemaking, the comments received, and the data in the Gulf Council‘s amendment referenced in the notice, interested parties were or should have been on notice that NMFS was considering the extent of the data to be collected, including socio-economic data such as charter fee, the fuel price and estimated amount of fuel used, number of paying passengers, and the number of crew for each trip.166
B. The Inclusion of the Five Economic Values in the Data Collected Is Not Arbitrary or Capricious.
An agency‘s decision is invalid if it is arbitrary or capricious.167 “An agency rule is arbitrary and capricious ‘if the agency has relied on factors which Congress has not intended it to consider, entirely failed to consider an important aspect of the problem, offered an explanation for its decision that runs counter to the evidence before the agency,
Plaintiffs argue the NMFS was arbitrary and capricious in requiring the reporting of the five economic values because the Gulf Council‘s Data Collection Technical Committee recommended against the inclusion of two of those values, charter fee and crew size.170 The Government argues NMFS was not required to adopt the recommendations of the Committee and provided sufficient reasons for not doing so.171
Concerning the crew size, Plaintiffs are incorrect when they assert the Committee recommended against collecting such data. The Committee recommended reporting of the number of crew on the vessel, finding such information “essential” and already included in the current headboat survey.172 The Committee recommended against collecting data on the number of crew fishing, which is a different dataset.173 The Final Rule does not require the reporting of the number of crew fishing. NMFS was not arbitrary or capricious when it required the number of crew members on the vessel to be reported in the Final Rule, as the Committee recommended.
Concerning the charter fee, the Committee did recommend against collecting such data in the electronic logbooks with the other data collected.174 However, the Committee noted collection of charter fee data was “[c]ritical for ANY economic analysis/assessment”
Economic information collected as part of the electronic logbooks will be superior, in terms of quality and usefulness, to information that can be obtained from websites or separate surveys. Data gathered from websites or separate surveys are frequently outdated, often suffer from small sample size issues, and are not linked to trip characteristics. By capturing the variation in these economic data across trips, NMFS can extract information about the value of individual trip characteristics (e.g., the marginal value per fish for a given species).176
The Final Rule also provided a rationale behind the reporting of economic information in general:
The collection of economic information will enhance the Gulf Council and NMFS’ ability to monitor and assess the economic effects of fishing regulations and environmental factors. This information will improve the best scientific information available for regulatory decision-making; will increase the accuracy of economic impacts and value estimates specific to the for-hire industry; and will support further value-added research efforts and programs aimed at increasing net benefits to fishery stakeholders and the U.S. economy. Also, this information will help generate estimates of lost revenue when a disaster occurs (e.g., hurricane, oil spill). For example, information collected by the Individual Fishing Quota programs was instrumental during the 2010 Deepwater Horizon MC 252 oil spill to account for lost revenue.177
By addressing the Committee‘s recommendation against collecting charter fee data, NMFS considered an important aspect of the problem and provided a reasoned response. NMFS‘s reasons “conform to minimal standards of rationality” and must be upheld.178 The Committee recommended collecting data on the other economic factors
II. Challenges to the Tracking Requirement
A. The Tracking Requirement Is Not in Excess of Statutory Authority.
1. The Magnuson-Stevens Fishery Conservation and Management Act (MSA) Authorizes the Required Purchase and Use of Tracking Equipment.
A court must set aside an agency action if it is in excess of the statutory authority granted to the agency by Congress.180 “A claim that agency action is ‘in excess of statutory jurisdiction, authority, or limitations, or short of statutory right,’ necessarily entails a firsthand judicial comparison of the claimed excessive action with the pertinent statutory authority.”181
Plaintiffs argue that, while the MSA authorizes the collection of information needed to implement FMPs, it does not authorize the requirement that regulated fishermen purchase the equipment needed to collect that information.182 Furthermore, Plaintiffs argue, the MSA‘s limitation on the types of fees the Secretary may collect reinforce this interpretation, as the required purchase of equipment would be similar to an unauthorized fee.183 The Government argues the MSA specifically authorizes
The MSA states “[a]ny fishery management plan which is prepared by any Council, or by the Secretary, with respect to any fishery, may . . . require the use of specified types and quantities of fishing gear, fishing vessels, or equipment for such vessels, including devices which may be required to facilitate enforcement of the provisions of this chapter.”185 As the rationale behind the tracking requirement is validation of fishing effort,186 the Court must thus determine whether the required purchase and use of tracking equipment in fact facilitates enforcement of the MSA. Two of the stated purposes of the MSA are “to conserve and manage the fishery resources found off the coasts of the United States” and “to promote domestic commercial and recreational fishing under sound conservation and management principles.”187 Furthermore, in implementing the MSA, Congress found “[t]he collection of reliable data is essential to the effective conservation, management, and scientific understanding of the fishery resources of the United States.”188
In furtherance of these purposes, the MSA requires FMPs to “specify the pertinent data which shall be submitted to the Secretary with respect to . . . charter fishing, . . . including, but not limited to . . . areas in which fishing was engaged in[ and] time of fishing.”189 The National Standards, with which all FMPs must be consistent, requires
Most broadly, the MSA requires FMPs to “contain the conservation and management measures . . . which are . . . necessary and appropriate for the conservation and management of the fishery, to prevent overfishing and rebuild overfished stocks, and to protect, restore, and promote the long-term health and stability of the fishery” and allows FMPs to “prescribe such other measures, requirements, or conditions and restrictions as are determined to be necessary and appropriate for the conservation and management of the fishery.”191 This “necessary and appropriate” phrasing is “empowering language [that] represents a delegation of authority to the agency.”192 “[T]hese statutory provisions ‘vest[ ] broad authority in the Secretary to promulgate such regulations as are necessary to carry out the conservation and management measures of an approved FMP.‘”193
Multiple courts have found the “necessary and appropriate” language allows NMFS to impose the costs of complying with certain FMP provisions on the industry.194 Three recent cases concerned industry funding of at-sea monitors—personnel who occasionally accompany vessels to collect data on the trip and catch. In Goethel v. Pritzker, the court
In this case, the Court finds the required purchase and use of tracking equipment facilitates enforcement of the MSA and is accordingly authorized as “equipment for . . . vessels . . . required to facilitate enforcement” of the MSA.198 NMFS chose to implement the tracking requirement “to validate effort (fishing trips)” and “aid with enforcement of the reporting requirement.”199 Specifically, the tracking requirement “will allow NMFS to independently determine whether the vessel leaves the dock” and, in particular, “when a fishing trip was taken, and the length of that trip.”200 The tracking requirement thus helps enforce the MSA‘s requirement that FMPs specify what data charter fishermen must submit, including “areas in which fishing was engaged in[] [and] time of fishing.”201
The fishermen are required to have the necessary equipment . . . as conditions of their Federal for-hire permits because they possess the information that the Gulf Council and NMFS need to improve management. NMFS is responsible for performing quality control, validating the reports, and using the data, as appropriate, to help achieve various management objectives.203
As in Goethel, Loper Bright, and Relentless Inc., the “necessary and appropriate” language in the MSA, combined with the explicit authorization to require fishermen to use certain equipment, authorizes FMPs to require regulated fishermen to bear the costs of the tracking requirement. The costs of compliance are nearly always “necessary,” as “Government regulation typically imposes costs on the regulated industry.”204
The MSA‘s restrictions on what fees the Secretary may charge, which the Plaintiffs argue reinforce their position that the MSA does not authorize the purchase of tracking equipment, are distinguishable from the costs of compliance with regulations in this case. The MSA‘s fee provisions concern scenarios in which the agency directly assesses payment against the industry.205 However, in the case of purchasing tracking equipment, fishermen would contract with third-party dealers for purchase and installation of such equipment.206 As the courts in Loper Bright and Relentless, Inc. noted, “fee-based program[s]” under the fee provisions of the MSA are “distinguishable ‘from the industry-
Accordingly, the required purchase of tracking equipment is authorized as a measure “necessary and appropriate for the conservation and management of the fishery,”209 namely the use of “equipment for . . . vessels . . . required to facilitate enforcement” of the MSA.210
2. NMFS‘s Authority to Require the Purchase and Use of Tracking Equipment Does Not Violate the Nondelegation Doctrine.
Article I, Section 1, of the Constitution vests “[a]ll legislative Powers herein granted . . . in a Congress of the United States.”211 “This text permits no delegation of those powers.”212 Therefore, “when Congress confers decisionmaking authority upon agencies Congress must ‘lay down by legislative act an intelligible principle to which the person or body authorized to [act] is directed to conform.‘”213 “Those standards . . . are not demanding.”214
Discussing the nondelegation doctrine, the Supreme Court has stated it has “almost never felt qualified to second-guess Congress regarding the permissible degree of policy judgment that can be left to those executing or applying the law.”218 In fact, the Court has found the requisite “intelligible principle” lacking in only two statutes, one of which provided literally no guidance for the exercise of discretion, and the other of which conferred authority to regulate the entire economy on the basis of no more precise a standard than stimulating the economy by assuring “fair competition.”219 On the other hand, the Supreme Court has found an intelligible principle even in statutes authorizing regulations in the “public interest.”220
all of the rules, regulations, conditions, methods, and other measures (A) which are required to rebuild, restore, or maintain, and which are useful in rebuilding, restoring, or maintaining, any fishery resource and the marine environment; and (B) which are designed to assure that--(i) a supply of food and other products may be taken, and that recreational benefits may be obtained, on a continuing basis; (ii) irreversible or long-term adverse effects on fishery resources and the marine environment are avoided; and (iii) there will be a multiplicity of options available with respect to future uses of these resources.223
Furthermore, the ten National Standards apply to all FMPs.224 Of particular note, National Standard 2 provides conservation management measures must be “based upon the best scientific information available“; National Standard 7 provides conservation management measures “shall, where practicable, minimize costs and avoid unnecessary duplication“; and National Standard 8 provides conservation and management measures shall “take into account the importance of fishery resources to fishing communities by utilizing economic and social data . . . , in order to (A) provide for the sustained participation of such communities, and (B) to the extent practicable, minimize adverse economic impacts on such communities.”225 Congress has thus provided a lengthy and
3. The Tracking Requirement Does Not Exceed Congress‘s Authority Under the Commerce Clause.
It is axiomatic that Congress cannot confer upon an agency authority that Congress itself does not possess.227 Plaintiffs argue that Congress does not have the authority under the Commerce Clause to compel fishermen to purchase tracking equipment.228 The Government argues the tracking requirement does not compel individuals to purchase
(1) Conservation and management measures shall prevent overfishing while achieving, on a continuing basis, the optimum yield from each fishery for the United States fishing industry.
. . . .
(3) To the extent practicable, an individual stock of fish shall be managed as a unit throughout its range, and interrelated stocks of fish shall be managed as a unit or in close coordination.
(4) Conservation and management measures shall not discriminate between residents of different States. If it becomes necessary to allocate or assign fishing privileges among various United States fishermen, such allocation shall be (A) fair and equitable to all such fishermen; (B) reasonably calculated to promote conservation; and (C) carried out in such manner that no particular individual, corporation, or other entity acquires an excessive share of such privileges.
(5) Conservation and management measures shall, where practicable, consider efficiency in the utilization of fishery resources; except that no such measure shall have economic allocation as its sole purpose.
(6) Conservation and management measures shall take into account and allow for variations among, and contingencies in, fisheries, fishery resources, and catches.
. . . .
(9) Conservation and management measures shall, to the extent practicable, (A) minimize bycatch and (B) to the extent bycatch cannot be avoided, minimize the mortality of such bycatch.
(10) Conservation and management measures shall, to the extent practicable, promote the safety of human life at sea.
Id.
Congress has the power “[t]o regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes.”230 “The power of Congress over interstate commerce is not confined to the regulation of commerce among the states,” but extends to activities that “have a substantial effect on interstate commerce.”231 However, in National Federation of Independent Business v. Sebelius, a majority of the Supreme Court held the Affordable Care Act‘s individual mandate, which imposed a monetary penalty on any individual who failed to maintain health insurance, exceeded Congress‘s authority under the Commerce Clause.232 Chief Justice Roberts noted that the individual mandate “does not regulate existing commercial activity” but “instead compels individuals to become active in commerce by purchasing a product.”233 Similarly, Justice Scalia, Justice Kennedy, Justice Thomas, and Justice Alito noted that under the Commerce Clause, “it must be activity affecting commerce that is regulated, and not merely the failure to engage in commerce.”234
Plaintiffs argue the tracking requirement compels them to engage in commerce by requiring them to purchase and install tracking equipment. However, multiple courts have rejected similar arguments. In Relentless, Inc., the court held that industry funding of at-sea monitors did not compel them to participate in commerce, namely the at-sea monitor market, because they were voluntary participants in the industry, subject to
As in Relentless, Inc. and Goethel, the tracking requirement does not compel the Plaintiffs to engage in commerce. Plaintiffs are not being regulated for doing nothing; they are voluntary participants in the charter vessel permit program. As participants in
B. NMFS‘s Responses to Comments Were Not Arbitrary or Capricious.
A court may set aside an agency action if it is “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.”244 This standard is “[h]ighly deferential” and “presumes the validity of agency action.”245 “The requirement that agency action not be arbitrary or capricious includes a requirement that the agency . . . respond to ‘relevant’ and ‘significant’ public comments.”246 “Comments are ‘significant,’ and thus require response, only if they raise points ‘which, if true . . . and which, if adopted, would require a change in an agency‘s proposed rule.‘”247 “Moreover, comments which themselves are purely speculative and do not disclose the factual or policy basis on which they rest require no response. There must be some basis for thinking a position taken in opposition to the agency is true.”248 The requirement to respond is not “particularly demanding.”249 “[T]he agency [is not required] to discuss every item of fact or opinion included in the submissions made to it in informal rulemaking“; rather, “the
1. NMFS Considered Comments Concerning Privacy.
Plaintiffs argue NMFS failed to respond to several comments raising Fourth Amendment concerns.251 The Government argues, because these comments largely focused on the use of location data by other agencies, NMFS reasonably interpreted these comments to concern data use and thus sufficiently responded to them.252
Four comments, quoted more fully above,253 raised Fourth Amendment concerns using identical language: “Providing all confidential transiting details is a violation of our 4th Amendment right to privacy and not necessary to manage the fishery. Such details are considered confidential by NOAA and utilized by other agencies not associated with management of the fishery.”254 NMFS addressed the “confidential transiting details” aspect of these comments:
NMFS will protect these data in accordance with applicable law. For example, under
section 402(b)(1) of the Magnuson-Stevens Act , the data submitted to NMFS under the Gulf For-hire Reporting Amendment shall be confidential and shall not be disclosed, except under the limited circumstances specified in the Magnuson-Stevens Act, such as to Council or Federal employees who are responsible for fishery management. As noted in50 CFR 600.415(e) , anyone “having access to these data are prohibited from unauthorized use or disclosure and are subject to the provisions of18 U.S.C. 1905 ,16 U.S.C. 1857 , and NOAA/NMFS internal procedures, including NAO 216-100.” Additionally, all data reported through the Gulf for-hire reporting program will be collected through software that meets standards set out by NMFS, including data confidentiality and protection of personal information online, and will be treated as confidential in accordance with NOAA Administrative Order 216-100, Protection of Confidential Fisheries Statistics. The release of data in aggregate or
summary form that does not directly or indirectly disclose the identity or business of any person who submits the information is authorized under
section 402(b)(3) of the Magnuson-Stevens Act .255
NMFS‘s interpretation of these four comments and its subsequent response was reasonable. It is incumbent upon the commenter to “disclose the factual or policy basis on which [his or her comment] rest[s],”256 and the agency “need not sift pleadings and documents to identify arguments that are not stated with clarity by a petitioner.”257 “Just as the opportunity to comment is meaningless unless the agency responds to significant points raised by the public, so too is the agency‘s opportunity to respond to those comments meaningless unless the interested party clearly states its position.”258 The only basis for their privacy objections that the commenters raised was that their “transiting details” are “confidential” according to NOAA. NMFS addressed this concern and was not required to dig for another basis of generalized Fourth Amendment concerns.
The Court finds Hussion v. Madigan259 persuasive. In that case, the Eleventh Circuit held it was “unable to find . . . the Agency‘s limited acknowledgment of general due process concerns evince[d] an ‘entire[ ] fail[ure]’ to consider them” when it addressed specific due process concerns raised in several of these comments.260 Hussion involved
To the extent the commenters’ general Fourth Amendment concerns raised important issues, the Court is satisfied that NMFS and the Gulf Council considered the important aspects of the problem.267 “The failure to respond to comments is significant only insofar as it demonstrates that the agency‘s decision was not based on a consideration of the relevant factors.”268 Courts have looked to the rulemaking record to
In this case, looking to the rulemaking record, the Gulf Council‘s Data Collection Technical Committee recommended, “Location data would be collected passively through a device . . . with a ping frequency of approximately 30 minutes. This ping frequency would balance the need for spatial information with the privacy concerns of vessel operators as it would be sufficient to establish regions of fishing (and depths) but not exact fishing locations.”275 Similarly, the Gulf Council amendment notes the Council selected an “archived vessel position system,” as opposed to a “real-time” system, in order
Moreover, in addressing concerns about the tracking requirement, although not specifically addressing privacy concerns, the Final Rule repeatedly notes that tracking equipment has been required for vessels with federal commercial permits for Gulf reef fish since 2006.279 In Aeronautical Repair Station Association v. FAA, the D.C. Circuit noted that the agency sufficiently responded to comments concerning privacy and Fourth Amendment concerns by stating, “albeit succinctly: ‘[T]he issues regarding invasion of privacy were resolved more than 15 years ago when the drug testing regulation carefully balanced the interests of individual privacy with the Federal government‘s duty to ensure aviation safety.‘”280 Similarly, in this case the Final Rule‘s discussion of the longtime tracking requirement for commercial fishing vessels shows NMFS considered the regulatory norms for the fishing industry and types of burdens it ought to impose.
Accordingly, to the extent the commenters’ general Fourth Amendment concerns raised important issues, the Court is satisfied “all relevant factors ha[ve] been
2. NMFS Considered Comments Concerning the Tracking Requirement‘s Necessity, Burden, and Cost.
Plaintiffs argue NMFS failed to respond to several comments concerned with the necessity, burden, and cost of the tracking requirement.283 They argue NMFS‘s reasons for imposing the tracking requirement on the charter fishing industry are conclusory and lack a cost-benefit analysis.284 The Government argues the Final Rule explains the need for the tracking requirement and NMFS carefully considered the costs of the tracking requirement compared to a charter vessel business‘s income.285 The Government also argues the APA does not require detailed citations and explanations.286
Several commenters objected to the need for tracking requirement when similar location information is already provided in reporting. For example, Willy Hatch commented, “Tracking does not provide any additional data that would be provided by filling out a vessel trip report.”287 Other commenters objected to the inclusion of the tracking requirement on small charter vessels because of the burden it would impose, compared to larger commercial vessels who already use tracking equipment. For example, Chuck Pollard commented, “Your proposal would treat [charter boats] like larger
Responding to the comments that “a location tracking system is unnecessary to provide validation of a vessel trip,” the Final Rule states:
The Gulf Council determined, and NMFS agrees, that requiring each Gulf for-hire vessel be equipped, at a minimum, with archivable vessel location tracking (cellular VMS) best balances the need to collect and report timely information with the need to minimize the cost and time burden to the industry. The vessel location tracking system is an additional mechanism that verifies vessel activity without a report having to be completed by the vessel operators. The vessel location tracking system will allow NMFS to independently determine whether the vessel leaves the dock. This will help validate effort and aid with enforcement of the reporting requirements.290
The Final Rule later explains what unique validation the tracking requirement adds: “[C]urrent reporting requirements . . . would not allow for the same level of trip validation, because [they] would not require GPS unit hardware to be permanently affixed to the vessel.291 The Gulf Council adopted the requirement that the tracking equipment be
The Gulf for-hire reporting program is designed to both monitor for-hire landings to determine in-season closures and post-season quota adjustments, and to enhance data collection efforts to provide for better fisheries management . . . . [R]esponsibility for the program is appropriately shared by NMFS and the fishermen. The fishermen are required to have the necessary equipment and report in a timely manner as conditions of their Federal for-hire permits because they possess the information that the Gulf Council and NMFS need to improve management. NMFS is responsible for performing quality control, validating the reports, and using the data, as appropriate, to help achieve various management objectives.293
NMFS further responded why the burden on charter fishing vessels would not be more significant compared to commercial fishing vessels:
NMFS does not expect that a continually operating VMS unit will drain the vessel‘s battery. VMS units have been required for vessels with Federal commercial permits for Gulf reef fish since 2006. Some of those vessels are relatively small and have not reported any problems with batteries draining due to the VMS units being on all the time. The VMS units vary in amperage draw, but the units generally draw less than 1,000 milliamperes while active. NMFS may approve solar-powered cellular VMS units that can store power lasting for 1 to 2 weeks. Furthermore, some units may allow a Gulf for-hire vessel owner or operator to use a 4-hour position reporting option when in-port, which would further reduce battery usage.
. . . .
The results of pilot testing of VMS units on charter vessels as small as 30 feet in length indicate that the units and antennae can be placed successfully. Also, VMS units have been required for vessels with Federal commercial permits for Gulf reef fish since 2006. Some of those Gulf reef
fish vessels are relatively small and fishermen have not found the systems to be impractical or unfeasible.294
Plaintiffs argue NMFS‘s reasoning is conclusory because it lacks a proper cost-benefit analysis under National Standard 7. National Standard 7 provides that conservation management measures “shall, where practicable, minimize costs and avoid unnecessary duplication.”295 However, it is well-settled that, under National Standard 7, “in making a decision on the practicability of a fishery management amendment, the Secretary does not have to conduct a formal cost/benefit analysis of the measure.”296 The regulatory guidelines for National Standard 7 state, “Management measures should not impose unnecessary burdens on the economy, on individuals, on private or public organizations, or on Federal, state, or local governments. Factors such as fuel costs, enforcement costs, or the burdens of collecting data may well suggest a preferred alternative.”297 However, “an evaluation of effects and costs, especially of differences among workable alternatives, including the status quo, is adequate.”298 Ultimately, a court‘s job on review “is not to undertake [its] own economic study, but to determine whether the [agency] ‘has established in the record a reasonable basis for its decision.‘”299
NMFS examined the costs of the tracking requirement. This analysis, quoted in full above,300 found cellular-based units would cost between $150 and $800 plus monthly service fees of $40 to $75.301 These estimates came from quotes from the vendors of
Based on a study by Louisiana State University, NMFS found the average monthly cash outflows of charter businesses to be $5,171.305 Compared to this data, the average startup costs for the tracking requirement amounted to 3.1% of annual charter vessel net income, and the recurring charges amounted to 1.8% of annual charter vessel net income.306 Moreover, NMFS noted that it was in the process of making a reimbursement program, which was already available for the purchase of approved satellite tracking equipment, available to fishermen for the purchase of approved cellular tracking equipment as well.307 As predicted, that reimbursement program for cellular tracking
Finally, NMFS laid out a detailed comparison, quoted in full above,311 of the costs and benefits of the selected requirement just discussed with those of the alternative proposals NMFS and the Gulf Council considered. One of these alternatives was not requiring the installation of tracking equipment and instead relying on the previous reporting requirements alone; however, as explained, this no-action option was not preferred as it did not provide the necessary validation of data that a device permanently affixed to the vessel would.312 The remaining two alternatives required the submission of real-time location data, as opposed to the archived location data required in the Final Rule.313 NMFS and the Gulf Council did not select these final two alternatives because of the significantly higher start up and recurring costs compared to the requirement they ultimately settled on.314
C. The Final Rule Complied with the Regulatory Flexibility Act.
Under the Regulatory Flexibility Act (“RFA“), when an agency promulgates a final rule after first being required to promulgate a notice of proposed rulemaking, the agency shall prepare a final regulatory flexibility analysis.315 This analysis must include, among other requirements,
a description of the steps the agency has taken to minimize the significant economic impact on small entities consistent with the stated objectives of applicable statutes, including a statement of the factual, policy, and legal reasons for selecting the alternative adopted in the final rule and why each one of the other significant alternatives to the rule considered by the agency which affect the impact on small entities was rejected.316
Plaintiffs argue the Final Rule‘s final regulatory flexibility analysis was neither reasonable nor in good faith because it did not consider an alterative to the tracking requirement that did not require purchasing tracking equipment. Plaintiffs also argue the analysis of costs was flawed because it was based on quotes from vendors of equipment NMFS was testing for eventual approval for use with the tracking requirement and because it assumed most fishermen would not require an additional cell phone and data plan.323 The Government argues the final regulatory flexibility analysis did consider a no-action alternative that would not require tracking equipment.324 Moreover, the
The Court finds the final regulatory flexibility analysis to be reasonable and in good faith. The NMFS considered a no-action alternative that would not have required the purchase and use of tracking equipment.326 However, as explained in Section II(B)(2) above, NMFS rejected this alternative because it would not provide the same level of validation as equipment affixed to the vessel.327 “[T]here is no requirement as to the amount of detail with which specific comments need to be discussed.”328 NMFS considered the lower-cost no-action alternative, and that is all the RFA requires.
Moreover, as explained in Section II(B)(2) above, it was not unreasonable for NMFS to rely on vendor quotes for the costs of devices in its analysis or to assume most fishermen nowadays have a cell phone. The RFA does not require complex “cost-benefit analysis or economic modeling.”329 It “mandates only that the agency describe the steps it took ‘to minimize the significant economic impact on small entities consistent with the stated objectives of applicable statutes.‘”330 The case Plaintiffs cite in support of their argument that NMFS failed to provide a factual basis for its cost estimates is unpersuasive as it involved an agency that excluded important costs by deferring their consideration until a later rulemaking.331 Instead, in this case, NMFS reasonably considered estimates based on the information before it while acknowledging “[s]ome vessel owners and
D. The Plaintiffs Have Abandoned Their Fifth Amendment Due Process Claim and Did Not Bring a Fifth Amendment Takings Claim in Their Complaints; the Court Will Not Allow Them to Amend Their Complaint at Such a Late Stage of the Case.
In their motion for summary judgment, Plaintiffs argue they are entitled to summary judgment that the required placement of tracking equipment on their vessels constitutes a taking under the Fifth Amendment.334 The Government argues Plaintiffs did not make a takings claim in either their complaint or their amended complaint.335 Rule 8 of the Federal Rules of Civil Procedure requires pleadings to contain “a short and plain statement of the claim showing that the pleader is entitled to relief.”336 The purpose of this requirement is to “to ‘give the defendant fair notice of what the . . . claim is and the grounds upon which it rests.‘”337
In both their complaint and amended complaint, Plaintiffs make only one Fifth Amendment claim, which is based on a violation of due process:
[I]f the data demanded is created by a device bought and paid for by Plaintiffs it belongs to them and the seizure of such data without any cause
at all, never mind probable, of that data by Defendants violates the due process clause of the Fifth Amendment to the U.S. Constitution.338
A claim that deprivation of property without cause violates due process invokes the principle under procedural due process that “some form of hearing is required before an individual is finally deprived of a property interest.”339 Other references to the Fifth Amendment in the complaints also focus on due process. Explaining Fifth Amendment protections, the complaints state, “The Fifth Amendment protects life, liberty, and property from deprivation by the Government without due process of law.”340 The prayer for relief requests a declaratory judgment that the tracking requirement violates the Fifth Amendment‘s “protection against deprivation of property without adequate due process of law.”341
The parties intended for this “case to be decided via cross motions for Summary Judgment.”342 Plaintiffs do not argue their Fifth Amendment due process claim in their motion for summary judgment.343 Nor do they assert a standalone due process claim in their opposition to the Government‘s cross-motion for summary judgment.344 Instead, they mention due process under the Fifth Amendment only in their attempt to show they brought a takings claim in their complaints.345 As a result, the Government has moved for
Next, Plaintiffs argue the use of the word “seizure” in their complaints transforms their due process claim into a takings claim.348 Invocation of the Fifth Amendment’s due process protections does not amount to making a takings claim. The mere mention of “seizure” is insufficient to place the Government on notice that Plaintiffs are bringing a takings claim. Ultimately, Plaintiffs’ first mention of a takings claim for the placement of tracking equipment on their vessels is in their motion for summary judgment. “A claim which is not raised in the complaint but, rather, is raised only in . . . a motion for summary judgment is not properly before the court.”349
“[W]hen a claim is raised for the first time in . . . a summary judgment motion, the district court should construe that claim as a motion to amend the complaint under
E. The Tracking Requirement Does Not Violate the Fourth Amendment.
Plaintiffs are correct that a court must set aside an agency action if it is “contrary to constitutional right, power, privilege, or immunity.”356 Plaintiffs argue the tracking requirement is a warrantless search and thus facially violates the Fourth Amendment’s
When a plaintiff brings a facial challenge to a statute or regulation, the “plaintiff must establish that a ‘law is unconstitutional in all of its applications.’”360 “But when assessing whether a statute meets this standard, the Court has considered only applications of the statute in which [the statute] actually authorizes or prohibits conduct.”361 Thus, “when addressing a facial challenge to a statute authorizing warrantless searches, the proper focus of the constitutional inquiry is searches that the law actually authorizes, not those for which it is irrelevant.”362 In this case, the relevant conduct is hourly location monitoring, with some exceptions, from tracking equipment required to be placed on charter fishing vessels participating in the federal Gulf charter vessel permit program. The Court assumes without deciding that the tracking requirement constitutes a Fourth Amendment search because, even if the tracking requirement constitutes a search, the search is reasonable under the closely regulated industry exception.
Under the closely regulated industry exception, some industries “‘have such a history of government oversight that no reasonable expectation of privacy’ exists for
1. The Fishing Industry Is a Closely Regulated Industry.
The Government argues the fishing industry is a closely regulated industry because of the long history of regulation meant to protect a valuable resource and, subsequently, the public.367 Plaintiffs argue the fishing industry is not a closely regulated industry because the fishing industry does not pose a clear and significant risk to the public welfare.368
To determine whether an industry is closely regulated, courts “consider the history of warrantless searches in the industry, how extensive the regulatory scheme is, whether
The fishing industry has a long history of regulation. The Federal Government has regulated fishing since at least 1793, when Congress enacted the Enrollment and Licensing Act of February 18, 1793, which granted licenses for the fishing of certain categories of fish.372 Even this early Act allowed for searches of licensed vessels:
And be it further enacted, That it shall be lawful for any officer of the revenue, to go on board of any ship or vessel, whether she shall be within or without his district, and the same to inspect, search and examine, and if it shall appear, that any breach of the laws of the United States has been committed, whereby such ship or vessel, or the goods, wares and merchandise on board, or any part thereof, is, or are liable to forfeiture, to make seizure of the same.373
Regulation of the fishing industry goes back even further. As the Third Circuit has put it, “the expectation of finding the game warden looking over one’s shoulder at the catch is virtually as old as fishing itself.”374 Regulation of the fishing industry has continued throughout U.S. history. One of the direct predecessors to the MSA, the Act of May 20, 1964, imposed fishing restrictions and authorized warrantless searches of fishing vessels:
Such person so authorized [to enforce this Act] shall have the power . . . with or without a warrant or other process, to search any vessel and, if as a result of such search he has reasonable cause to believe that such vessel or any person on board is in violation of any provision of this Act or the regulations issued thereunder, then to arrest such person.375
The provisions of the MSA itself, in effect since 1977, authorize warrantless searches: “Any officer who is authorized . . . to enforce the provisions of this chapter may . . . with or without a warrant or other process . . . (ii) board, and search or inspect, any fishing vessel which is subject to the provisions of this chapter.”376 In 2007, Congress amended the MSA to include data collection within the authorization of warrantless searches, allowing officers to “access, directly or indirectly, for enforcement purposes any data or information required to be provided under this subchapter or regulations under this subchapter, including data from vessel monitoring systems, satellite-based maritime distress and safety systems, or any similar system.”377 Under the MSA, other types of commercial fishing vessels also have been subject to similar tracking requirements for decades in all fishery regions.378 The NOAA’s website compiles a list of dozens of categories of vessels required to have tracking equipment by applicable regulations.379 For example, since 1997 scallop vessels in the Northeast region that are issued a full-time or part-time limited access scallop permit, or scallop vessels fishing under a certain small dredge program, or certain vessels issued a limited access multispecies or scallop permit,
Plaintiffs argue the MSA alone cannot provide evidence of close regulation because that is the regime they challenge.384 That argument would be persuasive if the Government’s proffered proof that the fishing industry is highly regulated were the challenged charter vessel tracking requirement itself,385 but that is not the case. Instead, the longstanding provisions of the MSA have authorized warrantless searches for over forty-five years in various scenarios, noted above, which Plaintiffs do not dispute. Furthermore, in the 2007 amendment Congress expanded the MSA’s grant of authority for warrantless searches to encompass data collection, including through tracking equipment.
Numerous courts have recognized that, because “[t]hose who venture on the seas are presumed to do so cognizant of the raft of regulations designed to promote their safe passage . . . , the ‘reasonable’ expectation of privacy is often less aboard a vessel than on land.”386 Considering the history of regulation and this lesser expectation of privacy at
Similarly, in Balelo v. Balrige,391 United States v. Raub,392 and United States v. Kaiyo Maru No. 53393 the Ninth Circuit held three different times the fishing industry is
Plaintiffs argue these cases finding the fishing industry closely regulated are no longer good law since the Supreme Court’s recent holding in City of Los Angeles v. Patel.398 Plaintiffs argue Patel held that, to be a closely regulated industry, the industry must “pose[] a clear and significant risk to the public welfare.”399 However, this is an overly broad reading of Patel. In Patel, the Court held that the hotel industry was not a closely regulated industry, and a city ordinance that authorized warrantless inspection of hotel records was an unreasonable search and seizure.400 The Supreme Court did clarify that risk to the public welfare is one factor to consider when determining whether an industry is closely regulated, but it is not the be-all and end-all. Indeed, Patel itself, after considering the risk to the public welfare and concluding hotels did not pose such a risk,
This interpretation is in line with courts’ analysis of closely regulated industries post-Patel. In Zadeh v. Robinson, which Plaintiffs cite in support of their argument that risk to the public welfare is required,402 the Fifth Circuit listed “whether the industry would pose a threat to the public welfare if left unregulated” as only one of four factors “courts consider.”403 Moreover, in ultimately holding the medical profession is not a closely regulated industry, the Fifth Circuit in Zadeh did not even address the danger to the public welfare when analyzing these factors.404 Indeed other courts post-Patel have not required there be a risk to the public welfare when extending closely regulated status to other industries. In Killgore v City of South El Monte, the Ninth Circuit reaffirmed the California massage industry was a closely regulated industry after Patel.405 The court noted the “comprehensive” regulations and the “long history of government regulation” in California but did not require there be a risk to the public welfare.406 In United States v. Hamad, the Seventh Circuit held the district court did not commit plain error in holding retail cigarette sales were part of a closely regulated industry.407 The court noted “there is a long history of regulation and licensing of cigarette sales in Chicago” but did not discuss the risk to the public welfare.408 In Goethel, the court held the fishing industry
Although it is not required, addressing the public welfare factor in this case, the Court finds there is a risk to the public welfare and this factor weighs in favor of classifying the fishing industry as closely regulated. As the Ninth Circuit has noted, the MSA “was adopted upon a clear showing that the supply of foodfish was dangerously depleted. Congress was aware that an important national asset was at stake and that strong measures were necessary.”412 In enacting the MSA, Congress found the United States’ fishery resources “contribute to the food supply, economy, and health of the Nation and provide recreational opportunities.”413 However, “[t]here [was] danger that irreversible effects from overfishing w[ould] take place.”414 Congress found a “national program . . . [was] necessary to prevent overfishing, to rebuild overfished stocks, to insure conservation, to facilitate long-term protection of essential fish habitats, and to realize the full potential of the Nation’s fishery resources,” which would in turn “assure that our citizens benefit from the employment, food supply, and revenue which could be generated
Because of the long history of regulations, which include authorization of warrantless searches; the decreased expectation of privacy these regulations create on vessels at sea; and the risk overfishing poses to the general welfare if the fishing industry is left unregulated, the Court finds the fishing industry is a closely regulated industry.
2. The Tracking Requirement Meets the Criteria in New York v. Burger.
In order to pass muster under the closely regulated industry exception, warrantless inspections in a closely regulated industry must satisfy the three Burger criteria: “(1) a substantial government interest, (2) a regulatory scheme that requires warrantless searches to further the government interest, and (3) ‘a constitutionally adequate substitute for a warrant.’”417
First, the Government has a substantial interest in protecting the fisheries and preventing overfishing. Plaintiffs do not seriously dispute the first of the Burger criteria. In fact, they admit “the government has an interest in conservation.”418 As noted in
Second, the tracking requirement is necessary to further the Government’s interest in protecting the fisheries. As explained in Section II(B)(2) above, the purpose of the tracking requirement is to “allow NMFS to independently determine whether the vessel leaves the dock.”422 Because the tracking requirement “verifies vessel activity without a report having to be completed by the vessel operators . . . [it] will help validate effort and aid with enforcement of the reporting requirements.”423 The requirement that the tracking equipment be permanently affixed to the vessel allows NMFS to know the position reported is actually the permitted vessel, as opposed to an unrelated position anyone could otherwise submit; “current reporting requirements . . . would not allow for the same level of trip validation.”424
Plaintiffs argue the tracking requirement is unnecessary because the electronic reporting requirement already requires reporting of general locations fished, and the Supreme Court in Patel rejected the argument that warrantless searches are necessary if they are meant merely to validate records.425 Again, this is an overly broad reading of
On the other hand, the Patel Court was not faced with the movements of vessels, which cannot be verified once the vessel changes location. As the Ninth Circuit noted in Kaiyo Maru, warrantless searches of vessels at sea were necessary in part because “the nature of the industry prevents procurement of a warrant for a specific vessel in advance,” namely, the officers “could not tell when or where they will encounter a vessel fishing” because “[f]ishing vessels are assigned to large areas, they are frequently authorized to move from area to area, and they move in and out of the [Fishery Conservation Zone] without restriction.”429 The Fifth Circuit likewise has noted the fleeting movements of vessels require a different approach than the traditional warrant requirement:
[T]here are characteristics of ships at sea that make it difficult to apply traditional warrant requirements to them. The sea is boundless and vessels may travel in any direction with none to observe them. The exact location of a vessel at any time may be difficult to pinpoint. While it would be easy in a warrant application to describe the vessel, it would be difficult, as the facts here show, to state where and when it will be searched.430
Plaintiffs also argue the tracking requirement is unnecessary because the Government could instead require fishermen to submit “no fishing” reports and spot check vessels for validation.432 However, the Government need not resort to less intrusive alternatives if those methods are cost prohibitive or provide insufficient data.433 In Balelo, the Ninth Circuit rejected alternatives to the stationing of observers on vessels—“aerial surveillance and the like”—because they were “prohibitive in terms of cost and . . . ineffective in terms of data collection.”434 Similarly, in this case, “no fishing” reports provide no more benefit than the electronic reporting of locations fished, which, as
Plaintiffs again point to Patel, which noted that, as an alternative to warrantless inspections, warranted spot checks would not “prove unworkable” because “there is no basis to believe that resort to such measures will be needed to conduct spot checks in the vast majority of them.”436 However, as explained, Patel dealt with hard records that were not going anywhere, which officers could easily return to verify after a short time. A spot check on a vessel would provide no information about the locations fished. It would show only whether a vessel was docked or not. NMFS need not resort to an alternative so ineffective in collecting data, especially when Congress has found “[t]he collection of reliable data is essential to the effective conservation, management, and scientific understanding of the fishery resources of the United States.”437
Third, the tracking requirement provides a constitutionally adequate substitute for a warrant. In order for a warrant substitute authorized by statute to be constitutionally adequate, “the regulatory statute must perform the two basic functions of a warrant: it must advise the owner of the commercial premises that the search is being made pursuant to the law and has a properly defined scope, and it must limit the discretion of the inspecting officers.”438 Courts have held the provisions themselves of the published regulations and statutes at issue may provide affected individuals notice of inspections. For example, in Burger, the Supreme Court found the statute authorizing “frequent” and “unannounced” inspections at vehicle-dismantling and related industries provided an adequate substitute for a warrant.439 The vehicle dismantlers were on notice of these inspections because “[t]he statute inform[ed] the operator of a vehicle dismantling business that inspections will be made on a regular basis.”440 The statute further “place[d] the operator on notice as to how to comply with the statute” and “notifie[d] the operator as to who is authorized to conduct an inspection.”441 Similarly, in Belelo, in addressing the notice provided by the statute, the Ninth Circuit noted, “The Act also requires publication of proposed regulations, and clearly defines its objectives and purposes.”442
While the statute must also limit the discretion of searching officers, it need not contain the most exacting limitations. For example, in Burger, the Supreme Court found the “the ‘time, place, and scope’ of the inspection [was] limited to place appropriate restraints upon the discretion of the inspecting officers.”444 Specifically, officers could only conduct inspections “during [regular] business hours”; these inspections were limited to the vehicle-dismantling and related industries; and the scope of the search was “narrowly defined” to “records, as well as ‘any vehicles or parts of vehicles which are subject to the record keeping requirements of this section and which are on the premises.’”445 Similarly, in United States v. Biswell, the Supreme Court held that regulatory provisions of the Gun Control Act that permitted warrantless inspections of both records and inventory “at all reasonable times” gave a firearms dealer adequate notice of “the purposes of the inspector [and] the limits of his task.”446
In this case, the MSA and implementing regulations put fishermen who choose to participate in the federal Gulf charter vessel permit program on notice that their data may be collected without a warrant. The MSA specifically allows officers to “access, directly or indirectly, for enforcement purposes any data or information required to be provided under this subchapter or regulations under this subchapter, including data from vessel
The tracking requirement also sufficiently limits the discretion of those who conduct the searches. In fact, since the data collection is automated, unlike a traditional search by an officer, there actually is no exercise of discretion; the search is the same as stated in the regulation each time. Nevertheless, the tracking requirement does limit the manner and scope of data collection. Location data is collected only once her hour.449 The Final Rule also contains two exceptions to the hourly collection of data: (1) an in-port exemption that allows the location data to be transmitted every four hours when the vessel is docked; and (2) a power-down exemption that allows for location data transmission requirements to be suspended when the vessel is out of the water for more than 72 hours.450 The tracking requirement is thus limited to times when the vessel is actively fishing or soon to be fishing, similar to the unannounced inspections during regular business hours in Burger. However, unlike Burger, the searches in this case are announced, as they take place regularly, generally once per hour. This ping frequency is narrow in scope, as it is sufficient to establish regions of fishing but not exact fishing locations.451 Just as the program in Burger was limited to the vehicle dismantling industry, the tracking requirement is limited to vessels participating in the federal charter vessel permit program. Furthermore, those who have access to this data—analogous to
In analyzing whether an inspection regime provides an adequate substitute for a warrant, courts note the extent of regulations in the industry, as “it is the pervasiveness and regularity of the federal regulation that ultimately determines whether a warrant is necessary to render an inspection program reasonable under the Fourth Amendment.”454 For example, in Kaiyo Maru, in holding warrantless inspections of vessels at sea provided an adequate substitute for a warrant, the court noted “foreign fishing in the [Fishery Conservation Zone] has become such a highly regulated enterprise that, given the other limitations of the inspection program, a warrant is unnecessary,” and “[v]essel owners and operators ‘cannot help but be aware that [the vessel] will be subject to periodic inspections undertaken for specific purposes.’”455 In this case, NMFS and the FMPs have for decades established tracking requirements for numerous portions of the commercial fishing industry.456 Because the tracking requirement for charter fishing vessels—similar to tracking requirements that are widespread throughout the commercial fishing industry—provides notice of location data collection, occurs at regular intervals with a limited scope of collection, and is carried out by select agencies. The longstanding practice of tracking in the fishing industry reinforces the Court’s determination that the tracking
Therefore, because the tracking requirement meets all three Burger criteria, the Court finds it reasonable under the closely regulated industry exception to the Fourth Amendment warrant requirement. Accordingly, the tracking requirement does not violate the Fourth Amendment’s protections against unreasonable searches and seizures.
CONCLUSION
IT IS ORDERED that the motion for summary judgment457 filed by Defendants the U.S. Department of Commerce, the National Oceanic and Atmospheric Administration, the National Marine Fisheries Service, and their respective heads in their official capacities is GRANTED.
IT IS FURTHER ORDERED that the motion for summary judgment458 filed by Plaintiffs Billy Wells; Mexican Gulf Shipping Co.; Allen Walburn; A&B Charters, Inc.; Kraig Dafcik; Joseph Dobin; Joey D. Charters; Frank Ventimiglia; Ventimiglia Charters; Jim Rinckey; and Fishing Charters of Naples is DENIED.459
New Orleans, Louisiana, this 28th day of February, 2022.
SUSIE MORGAN
UNITED STATES DISTRICT JUDGE