Halverson v. Slater

• Decision Date: 12 November 1997
• Docket Number: No. 96-5151,96-5151
• Citation: 129 F.3d 180
• Parties: Paul D. HALVERSON, et al., Appellants, v. Rodney E. SLATER, Secretary, United States Department of Transportation, Appellee.
• Court: U.S. Court of Appeals — District of Columbia Circuit

Page 180

129 F.3d 180

327 U.S.App.D.C. 97

Paul D. HALVERSON, et al., Appellants, v. Rodney E. SLATER, Secretary, United States Department of Transportation, Appellee.

No. 96-5151.

United States Court of Appeals, District of Columbia Circuit.

Argued Sept. 12, 1997.

Decided Nov. 12, 1997.

Appeal from the United States District Court for the District of Columbia (No. 96cv00028).

John Longstreth, Washington, DC, argued the cause, for appellants. Donald A. Kaplan was on brief.

Cynthia A. Schnedar, Assistant United States Attorney, argued the cause for the appellee. Eric H. Holder, Jr., United States Attorney, Washington, DC, at the time the brief was filed, and R. Craig Lawrence and Michael J. Ryan, Assistant United States Attorneys, were on brief.

Before: WALD, SENTELLE and HENDERSON, Circuit Judges.

KAREN LeCRAFT HENDERSON, Circuit Judge:

This appeal turns on the authority of the Secretary of the Department of Transportation (Secretary) to delegate certain responsibilities under the Great Lakes Pilotage Act of 1960, 46 U.S.C.A. §§ 9301 et seq. (West Supp.1997) (GLPA), to the Saint Lawrence Seaway Development Corporation (Corporation). The appellants, two Great Lakes ship pilots and two Great Lakes shipping pilots' associations, challenge the Secretary's delegation of GLPA responsibilities to the Corporation on the grounds that the delegation (1) exceeds the Secretary's authority under 46 U.S.C.A. § 2104(a) (West Supp.1997), (2) lodges with the Corporation duties it has no authority to discharge and (3) violates the Administrative Procedure Act, 5 U.S.C. §§ 551 et seq. (APA). The appellee, the Secretary, responds that delegation to the Corporation is proper: (1) an alternative source of delegation power, 49 U.S.C. § 322(b), supports the delegation; (2) the Corporation has authority to accept and discharge the "essentially economic" responsibilities it has been delegated because they relate to its broader mission of regulating commerce on the Saint Lawrence Seaway; and (3) the delegation does not contravene applicable APA requirements. The district court agreed with the Secretary in all respects and granted his motion for summary judgment. Halverson v. Pena, No. 96-CV-0028, 1996 WL 217885, at * 11 (D.D.C. Apr. 23, 1996).

We now reverse. Pursuant to the first step of the familiar Chevron analysis, we conclude that the plain meaning of section 2104(a) limits delegation of GLPA functions to the United States Coast Guard and that section 322(b) cannot fairly be construed to expand the limitation. See Chevron USA, Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984). We do not reach the other grounds asserted for reversal except to the extent they may bear on the question of the Secretary's authority, whether under section 322(b) or section 2104(a), to delegate GLPA responsibilities to the Corporation.

I. BACKGROUND

The Corporation was established in 1954 by an Act of the Congress, Pub.L. No. 83-558, 68 Stat. 93 (codified as amended at 33 U.S.C. §§ 981 et seq.). Its congressional charter set forth the Corporation's specific (and limited) functions in some detail. See 33 U.S.C. § 983; ¹ S.Rep. No. 83-441, at 2, 6-14 (1953) (describing limited purposes for which Corporation was created); H.R.Rep. No. 83-1215 (1954) (similar), reprinted in 1954 U.S.C.C.A.N. 2197, 2224-42. The narrowness of the Corporation's mission was further reflected in the statutory enumeration of the Corporation's powers. See 33 U.S.C. § 984(a). ² When first established, the Corporation was "subject to the direction and supervision of the President, or the head of such agency as he may designate." 33 U.S.C. § 981 (1954). Through fiscal year 1966, the Department of Commerce was the agency designated to supervise the Corporation. In fiscal year 1967, however, the Congress amended section 981, replacing the "President, or the head of such agency as he may designate" language with the "Secretary of Transportation." 33 U.S.C. § 981 (1966).

Construction of the Saint Lawrence Seaway was completed in 1959, opening the Great Lakes to international shipping. Not surprisingly, opening of the Seaway brought with it a marked increase in the volume of both domestic and international marine traffic navigating the Great Lakes, their tributaries and their outlets. As a result, one year later the Congress enacted GLPA. See Pub.L. No. 86-555, 74 Stat. 259 (1960) (codified as amended at 46 U.S.C.A. §§ 9301 et seq. (West Supp.1997)). Among other things, GLPA required commercial ships to employ a registered United States or Canadian pilot to steer them (or advise them how to steer) safely and efficiently through certain portions of the Great Lakes, their tributaries and outlets, and the approaches to the Sault Sainte Marie Locks. See 46 U.S.C.A. § 9302 & Note (West Supp.1997).

As noted, in 1967 the Department of Transportation took over supervision of the Corporation. That same fiscal year, administrative responsibility for the United States Coast Guard was transferred from the Department of the Treasury to the Transportation Department. ³ See Pub.L. No. 89-670, § 6(b)(1), 80 Stat. 931 (1966) (codified as amended at 14 U.S.C. § 1). The Transportation Secretary subsequently delegated his GLPA responsibilities to the Commandant of the Coast Guard, with whom they remained until December 1995. See Delegations to Commandant of the Coast Guard, 49 C.F.R. § 1.46(a) (1994).

In December 1995, the Secretary published a final rule that rescinded the standing delegation of GLPA functions to the Coast Guard and redelegated eleven "essentially economic" functions to the Corporation. See Organization and Delegation of Powers and Duties; Transfer of Great Lakes Pilotage Authority From the Coast Guard to the Saint Lawrence Seaway Development Corporation, 60 Fed.Reg. 63,444 (1995) (codified at 49 C.F.R. § 1.52(d)-(e) (1997)). ⁴ Shortly thereafter, the appellants filed suit and moved for a preliminary injunction or summary judgment. The Secretary cross-moved for summary judgment and a hearing on the motions was held on March 8, 1996. At its conclusion, the district court denied the appellants' motion for a preliminary injunction and reserved decision on the parties' summary judgment motions.

By Memorandum Opinion and Order dated April 23, 1996 the district court granted the Secretary's cross-motion for summary judgment, finding that both the first and second steps of the analysis set forth in Chevron compelled a holding in his favor. Halverson, 1996 WL 217885, at * 4-* 6. The lower court first applied Chevron step one to section 322(b), whose provisions principally authorize the Secretary to delegate his Title 49 powers and duties to any Transportation officer or employee. The trial court, however, failed to construe section 322(b) in light of section 2104(a)--a specific grant of delegation authority of Title 46 powers and duties (including GLPA powers and duties) to Coast Guard officials only. Nor did the court below otherwise attempt to interpret section 2104(a) according to Chevron step one, id.

at * 4-* 5, deciding instead to construe it pursuant to Chevron step two. While the district court concluded that its step-one analysis of section 322(b) resolved the delegation issue in the Secretary's favor, it further found that even if section 322(b) was not unambiguous, the Secretary's interpretation of section 2104(a) was reasonable and therefore entitled to deference under Chevron step two. Id.

at * 5-* 6. Thus, the lower court applied Chevron step one to section 322(b) and Chevron step two to section 2104(a).

II. DISCUSSION

We review the district court's award of summary judgment de novo. See Diamond v. Atwood, 43 F.3d 1538, 1540 (D.C.Cir.1995). The parties' arguments regarding the Secretary's authority to delegate GLPA functions to non-Coast Guard officials center on the proper interpretation of (and relationship between) 49 U.S.C. § 322(b) and 46 U.S.C.A. § 2104(a) (West Supp.1997). Section 322(b), in relevant part, provides:

The [Transportation] Secretary may delegate, and authorize successive delegations of, duties and powers of the Secretary to an officer or employee of the Department.

49 U.S.C. § 322(b). As the Secretary reads this provision, it gives him largely unfettered discretion to delegate duties and powers to agency officers and employees. ⁵ Indeed, he appears to have succeeded in convincing the district judge that only an express statutory prohibition could foreclose exercise of his section 322(b) authority. See Halverson, 1996 WL 217885, at * 6 ("Had Congress intended the Great Lakes pilotage functions to remain solely with the Coast Guard, it could have explicitly provided so.") (emphasis added). The appellants read the Secretary's section 322(b) authority a good deal more narrowly. They contend, in effect, that the scope of section 322(b) cannot be determined without reference to the specific power being delegated, the authority of the delegatee to exercise the power and any limitations that may be imposed by other, more specific statutory provisions such as 46 U.S.C.A. § 2104(a) (West Supp.1997).

Section 2104(a), in turn, provides that:

The Secretary may delegate the duties and powers conferred by this subtitle [Subtitle II entitled "Vessels and Seamen"] to any officer, employee, or member of the Coast Guard, and may provide for the subdelegation of those duties and powers.

46 U.S.C.A. § 2104(a) (West Supp.1997). ⁶ The appellants read section 2104(a) to authorize the Secretary to exercise GLPA duties and powers himself or to delegate them to a Coast Guard official. They believe that section 2104(a) unambiguously proscribes delegation of GLPA responsibilities outside the Coast Guard and thwarts the Secretary's attempt to effect such a delegation pursuant to his general section 322(b) authority. The Secretary, unsurprisingly, construes section 2104(a) quite differently. He reasons that...