MULTISTAR INDUSTRIES, INC., dba Multifrost, Inc., Petitioner, v. U.S. DEPARTMENT OF TRANSPORTATION; Federal Motor Carrier Safety Administration, Respondents. Multistar Industries, Inc., dba Multifrost, Inc., Petitioner, v. U.S. Department of Transportation; Federal Motor Carrier Safety Administration, Respondents.
Nos. 12-73138, 12-73485
United States Court of Appeals, Ninth Circuit
February 7, 2013
707 F.3d 1045
Finally, PRA briefly raises an as-applied due process challenge to the TCPA. Questions of law, including due process claims, are reviewed de novo. Vargas-Hernandez v. Gonzales, 497 F.3d 919, 921 (9th Cir. 2007). The basis for PRA‘s due process claim is not entirely clear, so we analyze it as a substantive and procedural due process challenge. First, to the extent PRA raises a substantive due process challenge, the property interest PRA identified is its interest in conducting a debt collection business—an economic interest. We have held that “[w]here a fundamental right is not implicated . . . governmental action need only have a rational basis to be upheld against a substantive due process attack. If a statute is not arbitrary, but implements a rational means of achieving a legitimate governmental end, it satisfies due process.” Kim v. United States, 121 F.3d 1269, 1273 (9th Cir. 1997) (citation and internal quotations omitted). Here, Congress had several goals when it passed the TCPA, including prohibiting the use of automatic telephone dialing systems to communicate with others by telephone in a manner that invades privacy. See Satterfield, 569 F.3d at 954. Prohibiting the use of automatic dialers to call cellular telephones without express prior consent is a rational means of achieving this objective. To the extent PRA raises a procedural due process challenge, its argument fails because PRA has not shown that it was denied notice or an opportunity to be heard.
AFFIRMED.
Jonathan H. Levy (argued) and Matthew Collette, United States Department of Justice, Civil Division; Stuart F. Delery, Principal Deputy Assistant Attorney General; Robert S. Rivkin, General Counsel; Paul M. Geier, Assistant General Counsel for Litigation; Timothy H. Goodman, United States Department of Transportation; T.F. Scott Darling, III, Chief Counsel; Fred K. Ford, Assistant Chief
Before: MARSHA S. BERZON and SANDRA S. IKUTA, Circuit Judges, and JENNIFER G. ZIPPS, District Judge.*
OPINION
BERZON, Circuit Judge:
Petitioner Multistar Industries, Inc. (“Multistar“) is a for-hire motor carrier engaged in the business of transporting hazardous materials. As a result of a recent compliance review of Multistar‘s operations, conducted by the U.S. Department of Transportation Federal Motor Carrier Safety Administration (“FMCSA” or “the agency“), Multistar was assigned an “unsatisfactory” safety rating and, as a consequence, ordered to cease operations. The agency denied Multistar‘s subsequent administrative appeal, which challenged certain violations discovered during the compliance review.
Multistar now petitions for review of FMCSA‘s order, and, in a separate petition for review, challenges the agency‘s denial of Multistar‘s petition for administrative review. We dismiss in part and deny in part the consolidated petitions.
I. Statutory and Regulatory Background
Congress has directed the Secretary of Transportation to “determine whether an owner or operator is fit to operate safely commercial motor vehicles, utilizing among other things . . . [the] safety inspection record of such owner or operator.”
The Secretary‘s authority to regulate the procedures of such fitness determinations has been delegated to the FMCSA. See
An “unsatisfactory” safety rating means that the carrier “does not have adequate safety management controls in place to ensure compliance with the safety fitness standard,” and that, as a result, violation of the safety regulations has occurred.
The factors considered in determining a carrier‘s safety rating include information collected during “on-site examination[s] of motor carrier operations,” termed “compliance reviews.”
The methodology for determining the proposed safety rating is contained in Appendix B to Part 385. Section VII of Appendix B categorizes certain regulations (i.e., certain FMCSRs and HMRs) as “acute” or “critical.” The ratings methodology provides that each violation of an acute regulation is considered one “point.” Each pattern of violations of a critical regulation (meaning more than one violation of the same critical regulation) is considered one or two points, depending on which critical regulation is violated.
- Factor 1—General (Parts 387 and 390)
- Factor 2—Driver (Parts 382, 383, and 391)
- Factor 3—Operational (Parts 392 and 395)
- Factor 4—Vehicle (Parts 393 and 396)
- Factor 5—Hazardous Materials (Parts 397, 171, 177 and 180)
- Factor 6—Accident Factor
A proposed overall “unsatisfactory” safety rating is provisional and does not become final until 45 days after the carrier receives written notice of the proposed rating.
In addition to, or instead of, seeking administrative review under
II. Factual and Procedural Background
A. Multistar‘s Compliance Review and Safety Rating
On August 13, 2012, FMCSA conducted a compliance review of Multistar‘s operations. That review found 26 total sets of violations of various regulations, resulting in unsatisfactory Factor 2 and Factor 5 ratings and, therefore, an overall “unsatisfactory” rating. Multistar‘s Factor 2 rating was based on discovered violations of two acute regulations.4 Its unsatisfactory Factor 5 rating was based on violations of two acute and five critical regulations.5 Pursuant to the agency‘s ratings methodol-
Four days later, on August 17, FMCSA sent Multistar an official notice stating that the proposed “unsatisfactory” rating would become final and Multistar would be prohibited from operating commercial motor vehicles in 45 days—that is, on October 2, 2012—unless it took the steps necessary to improve its rating before that date. The notice also provided information regarding how to request a safety rating upgrade under
B. Administrative Proceedings
1. Multistar‘s Administrative Appeal under § 385.15
On August 31, 2012—fourteen days after FMCSA sent the official notice—Multistar
On September 25, 2012, FMCSA issued a letter to Multistar ordering it to cease all transportation operations by October 2, 2012, as required under
The following week, on October 1, FMCSA issued its decision denying Multistar‘s petition for administrative review. In doing so, FMCSA noted that violations 8 and 14 were neither acute nor critical, and therefore were irrelevant to Multistar‘s overall safety rating under the ratings methodology.6 As to violation 17, the agency observed that Multistar denied merely “that it knowingly committed the violation,” with no further explanation or argument; FMCSA explained that “[g]eneral denials are insufficient to demonstrate that the Agency erred in assigning [Multistar]‘s safety rating.” Finally, with respect to violations 5 and 11, the agency noted that those violations comprised only two of the seven total violations of acute or critical regulations falling within Factor 5, and, therefore, “removal of th[o]se violations would not change [Multistar‘s] overall Unsatisfactory safety rating.” The agency thereby affirmed Multistar‘s overall “unsatisfactory” rating and the order to cease operations.
2. Multistar‘s Upgrade Requests under § 385.17
At the same time Multistar was pursuing its appeal with the agency, on September 7, 2012 it also requested a safety rating upgrade pursuant to
C. Judicial Proceedings
On October 1, 2012, the same day FMCSA denied Multistar‘s petition for administrative review and one day before the order to cease operations was to take effect, Multistar filed a petition for judicial review of the order and an emergency motion to stay the requirement that it cease operations. We granted Multistar‘s emergency motion and stayed the order pending resolution of Multistar‘s petition for review. On October 25, 2012, Multistar filed a second petition for judicial review challenging the agency‘s denial of its petition for administrative review. We consolidated the two petitions for review.
We have jurisdiction to review specified final orders of the Secretary of Transportation under the Hobbs Act,
Multistar asserts two principal challenges on appeal, one substantive and the other procedural. First, it argues that the agency abused its discretion in issuing the order to cease operations, because the “unsatisfactory” safety rating on which it was based was itself premised on the misapplication of certain safety regulations. Second, Multistar contends that the agency acted arbitrarily or capriciously and violated its due process rights by denying Multistar‘s petition for administrative review without providing a substantive response to some of the carrier‘s challenges. We address each challenge in turn.
A. Multistar‘s Challenge to FMCSA‘s “Unsatisfactory” Rating and Order to Cease Operations
According to Multistar, the order to cease operations and the “unsatisfactory” rating should be set aside as an abuse of discretion premised on a misapplication of certain safety regulations. Specifically, Multistar challenges violations 5 and 11 listed in the compliance review,8 arguing that they were based on the agency‘s erroneous findings that some of Multistar‘s container tanks violated specified safety regulations, but, according to Multistar, the regulations relied upon did not apply to those types of tanks.
Under the Hobbs Act and the APA, we are limited to reviewing only the “final” action taken by the agency.
Absent our stay, the order to cease operations would have taken effect the day after the unsatisfactory rating became final.
Significantly, Multistar‘s final safety rating did not rely on or otherwise incorporate violations 5 and 11. Indeed, although these contested violations made up two of the seven Factor 5 violations that, combined with Multistar‘s Factor 2 violations, first resulted in the agency‘s proposed “unsatisfactory” safety rating, the agency expressly disclaimed any reliance on them in denying Multistar‘s petition for administrative review. As the agency explained, the August 13 compliance review revealed a total of seven violations of acute or critical regulations falling within Factor 5. Because a finding of just two violations of acute or critical regulations yields an “unsatisfactory” factor rating, see
Thus, violations 5 and 11 did not factor into Multistar‘s final “unsatisfactory” safety rating, and so did not underlie the order to cease operations. In other words, there was no final agency action that found violations 5 and 11 or depended on such findings. Multistar cannot substantively challenge in this judicial, APA proceeding the propriety of those nonfinal determinations. Multistar does not contend that the “unsatisfactory” rating is invalid on the grounds on which it was upheld. We therefore must dismiss the petitions insofar as they challenge the “unsatisfactory” rating and the order to cease operations.
Multistar‘s assertion that its substantive challenges to violations 5 and 11 “work in tandem” with its upgrade requests does not change this conclusion. According to Multistar, if the agency were to grant the upgrade request, then the removal of violations 5 and 11 from the compliance review could become relevant to its overall safety rating. As noted, however, Multistar has yet to seek administrative review of either of the agency‘s denials of its upgrade requests. Unless and until Multistar does so, the currently operative “unsatisfactory” safety rating and order to cease operations stand firmly on the uncontested violations, and not on violations 5 and 11. Without a final decision by the agency as to those violations, we may not reach the merits of Multistar‘s substantive claims, and so dismiss the petition for review as to the merits of violations 5 and 11.
B. Multistar‘s Due Process Challenge to the Denial of its Petition for Administrative Review
Multistar also challenges FMCSA‘s denial of its request for administrative review, on the grounds that the agency‘s refusal to address the merits of Multistar‘s challenges to violations 5 and 11 was arbitrary and capricious and violated the carrier‘s due process rights.
As noted, FMCSA denied the request for review because removing violations 5 and 11 would not alter Multistar‘s overall safety rating. That response, Multistar asserts, deprived Multistar of a substan-
1
As an initial matter, we note that, notwithstanding our dismissal of Multistar‘s substantive claims, Multistar has standing to raise this procedural challenge. To satisfy Article III standing, a plaintiff must show (1) it “ha[s] suffered an ‘injury in fact‘” that is “concrete and particularized” and “actual or imminent, not conjectural or hypothetical“; (2) a “causal connection between the injury” and the challenged action of the defendant; and (3) that it is “likely, as opposed to merely speculative, that the injury will be redressed by a favorable decision.” Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992) (internal quotation marks omitted).
Our analysis of the first, injury in fact, aspect of standing is “not fundamentally changed by the fact that a petitioner asserts a procedural, rather than a substantive injury.” Nuclear Info. & Res. Serv. v. NRC, 457 F.3d 941, 949 (9th Cir. 2006) (internal quotation marks omitted). Where, as here, a plaintiff alleges injury based on the government‘s failure to abide by a procedural requirement, it must show that the procedures “protect[] a concrete threatened interest.” Salmon Spawning & Recovery Alliance v. Gutierrez, 545 F.3d 1220, 1229 (9th Cir. 2008) (internal quotation marks omitted); Lujan, 504 U.S. at 573 & n. 8, 112 S.Ct. 2130. Once a plaintiff establishes such an interest, however, its burden to establish the other two standing elements—causation and redressability—is lessened. Salmon Spawning & Recovery Alliance, 545 F.3d at 1224. Notably, for standing purposes, a plaintiff alleging a procedural due process violation need not
According to Multistar, the order to cease operations is invalid because the procedures for administrative review set forth in
We hold that the asserted injury is sufficient for standing purposes and that, as the claim asserted is procedural, the possibility that the claim could result in a final, judicially reviewable decision as to the validity of the two challenged violations meets the causation and redressability factors applicable to such procedural claims. In so ruling, of course, we assume, subject to administrative review, as to its challenges to violations 5 and 11.9
2
Reaching the merits of Multistar‘s procedural claim accordingly, we conclude that FMCSA was not obligated in response to the request for review to provide a substantive response to Multistar‘s challenges concerning violations 5 and 11. Because those challenges, even if correct, could not have affected FMCSA‘s final action, the agency was not obligated to reach their merits. Cf. Simpson v. Young, 854 F.2d 1429, 1433-35 (D.C. Cir. 1988) (noting that agencies generally are not obligated “to address every argument advanced [by a petitioner] . . . no matter how minor or inconsequential the argument may be“).
Multistar argues that
Multistar relies on Darrell Andrews, 296 F.3d 1120, to argue that the agency in its review decision was obligated substantively to determine the challenges to violations 5 and 11 raised in Multistar‘s petition. In Darrell Andrews, a motor carrier petitioned for administrative review of FMCSA‘s decision assigning the carrier a “conditional” safety rating pursuant to the ratings methodology contained in Appendix B to § 385. 296 F.3d at 1122-23. That rating was based on the motor carrier‘s failure to maintain certain toll receipts for its drivers in violation of
By contrast, FMCSA‘s assignment of an “unsatisfactory” safety rating to Multistar was not based on the violations challenged in Multistar‘s petition for administrative review. Multistar provides no basis—and we can conceive of none—for concluding that there is a regulatory or statutory requirement that FMCSA address the merits of an allegation that, even if valid, could not have affected the agency‘s final action.
Transforming the same argument into a constitutional one grounded in a denial of due process does not assist Multistar. The Due Process Clauses of the Fifth and Fourteenth Amendments protect against “depriv[ations] of life, liberty, or
As FMCSA concedes, its order requiring Multistar to cease operations constitutes a deprivation of Multistar‘s property interests. But, as noted, that final agency action did not rest on violations 5 and 11.10 Whether the agency reached the merits of Multistar‘s substantive challenges, therefore, had no bearing on the deprivation Multistar suffered.
The Supreme Court‘s decision in Codd v. Velger, 429 U.S. 624, 97 S.Ct. 882, 51 L.Ed.2d 92 (1977) (per curiam), is instructive in this regard. Codd involved the termination of a non-tenured police officer who asserted that information about an attempted suicide that was placed by the City Police Department in his personnel file was sufficiently stigmatizing to warrant a hearing under procedural due process principles. Id. at 625-26, 97 S.Ct. 882. The Court declined to reach the merits of the officer‘s due process claim, however, because “[n]owhere in his pleadings or elsewhere ha[d] [the officer] affirmatively asserted that the report of the apparent suicide attempt was substantially false.” Id. at 627, 97 S.Ct. 882. Because the officer did not challenge the validity of any underlying deprivation, the Court explained, “no hearing would afford a promise of achieving th[e] result [sought by] him,” i.e., the “opportunity to clear his name.” Id. at 627-28, 97 S.Ct. 882. Here too, the procedural protection that Multis- tar seeks—a decision by the agency on the merits of its substantive challenges to violations 5 and 11—would not affect “the legitimacy of the underlying deprivation,” i.e., the requirement to cease operations. Rector v. City & Cnty. of Denver, 348 F.3d 935, 944 (10th Cir. 2003) (discussing Codd).
Beyond the order to cease operations, Multistar has made no attempt to identify the property interest at stake, or to explain how it was deprived of any property right.11 It has therefore not raised a cognizable claim of deprivation of due process.
Finally, the agency‘s denial of administrative review did not, as Multistar alleges, deprive the carrier of a forum to contest violations 5 and 11 if and when they become the basis for an adverse order.12 Under
Since filing its briefs in this case, Multistar has availed itself of this process, and has received a first-level substantive decision from the agency as to its challenges to violations 5 and 11. Multistar may, within 90 days of the agency‘s denial of its latest
In short, Multistar has received all of the process it was due with regard to the contested violations, and FMCSA‘s denial of Multistar‘s petition for review was not arbitrary or capricious. Accordingly, we deny Multistar‘s petition for review as to the due process issue.
DISMISSED in part and DENIED in part.
MARSHA S. BERZON
UNITED STATES CIRCUIT JUDGE