637 F.3d 319 (D.C. Cir. 2011), 09-5372, Menkes v. U.S. Dept. of Homeland Sec.

Docket Nº:09-5372.
Citation:637 F.3d 319
Opinion Judge:EDWARDS, Senior Circuit Judge:
Party Name:Richard J. MENKES, Appellant v. U.S. DEPARTMENT OF HOMELAND SECURITY, et al., Appellees.
Attorney:Jonathan G. Axelrod argued the cause and filed the briefs for appellant. Edward M. Gleason Jr. entered an appearance. Alan Burch, Assistant U.S. Attorney, argued the cause for appellees. With him on the brief were Ronald C. Machen Jr., U.S. Attorney, and R. Craig Lawrence, Assistant U.S. Attorney...
Judge Panel:Before: GINSBURG and BROWN, Circuit Judges, and EDWARDS, Senior Circuit Judge. Opinion for the Court filed by Senior Circuit Judge EDWARDS. Opinion filed by Circuit Judge BROWN dissenting in part. BROWN, Circuit Judge, dissenting in part:
Case Date:March 08, 2011
Court:United States Courts of Appeals, Court of Appeals for the District of Columbia Circuit
 
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637 F.3d 319 (D.C. Cir. 2011)

Richard J. MENKES, Appellant

v.

U.S. DEPARTMENT OF HOMELAND SECURITY, et al., Appellees.

No. 09-5372.

United States Court of Appeals, District of Columbia Circuit.

March 8, 2011

Argued Oct. 22, 2010.

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[Copyrighted Material Omitted]

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Appeal from the United States District Court for the District of Columbia (No. 1:04-cv-01456).

Jonathan G. Axelrod argued the cause and filed the briefs for appellant. Edward M. Gleason Jr. entered an appearance.

Alan Burch, Assistant U.S. Attorney, argued the cause for appellees. With him on the brief were Ronald C. Machen Jr., U.S. Attorney, and R. Craig Lawrence, Assistant U.S. Attorney. Claire Whitaker, Assistant U.S. Attorney, entered an appearance.

Before: GINSBURG and BROWN, Circuit Judges, and EDWARDS, Senior Circuit Judge.

Opinion for the Court filed by Senior Circuit Judge EDWARDS.

Opinion filed by Circuit Judge BROWN dissenting in part.

OPINION

EDWARDS, Senior Circuit Judge:

The Great Lakes Pilotage Act (" GLPA" ) sets forth certain requirements for persons who serve as pilots of vessels sailing on the waters of the Great Lakes. Under the statute, the United States Coast Guard (" Coast Guard" or " agency" ) is afforded discretion to " authorize the formation of a pool by a voluntary association of United States registered pilots to provide for efficient dispatching of vessels and rendering of pilotage services." 46 U.S.C. § 9304(a). Pursuant to this statutory authority, the Coast Guard has promulgated regulations that provide for the formation of pools in three Great Lakes districts. 46 C.F.R. § 401.300. Under the applicable regulations, " [w]hen pilotage service is not provided by the association authorized under 46 U.S.C. 9304 because of a physical or economic inability to do so, ... the Director [of Great Lakes Pilotage of the Coast Guard] may order any U.S. registered pilot to provide pilotage service." Id. § 401.720(b).

Appellant Richard Menkes was a member of the St. Lawrence Seaway Pilots' Association (" SLSPA" or " Association" )— the only voluntary association designated by the Coast Guard to provide pilotage service in the district encompassing the St. Lawrence River and Lake Ontario. Menkes resigned from the SLSPA in 2000 and then requested the Coast Guard to dispatch him as an unaffiliated, independent pilot on the St. Lawrence River. In March 2001, Menkes was so assigned pursuant

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to § 401.720(b). In late 2003, the Coast Guard determined that Menkes's appointment as an independent pilot would " naturally expire" at the conclusion of the 2003 navigation season. The agency indicated that it would continue to monitor the SLSPA to determine whether the services of an independent pilot would be required during the 2004 season. However, Menkes was never reassigned to serve on the St. Lawrence River in 2004.

In August 2004, Menkes filed suit against the United States Department of Homeland Security, the Coast Guard, and the Assistant Commandant of the Coast Guard (collectively " the Government" ), challenging the Coast Guard's determination to terminate his appointment as an unaffiliated, independent pilot. Menkes claimed that the Government's action violated the Administrative Procedure Act (" APA" ), as well as his First Amendment and Fifth Amendment rights. The District Court granted the Government's motion to dismiss. Menkes v. Dep't of Homeland Sec. (" Menkes I " ), 402 F.Supp.2d 204 (D.D.C.2005). On appeal, we reversed and remanded the case. Menkes v. Dep't of Homeland Sec. (" Menkes II " ), 486 F.3d 1307 (D.C.Cir.2007). The District Court then remanded the case to the Coast Guard for further consideration.

After further review, the Coast Guard held that, under the statute and applicable regulations, a " voluntary association" under 46 U.S.C. § 9304 refers to a group of people " joined together for a certain purpose, and not a legal entity distinct from the persons who are members." See Agency Decision on Remand in the Appendix to this opinion. The Coast Guard held further that a certified voluntary association is not required to " dispatch every registered, licensed and qualified pilot who desires to provide pilotage services." Id. In other words, pilots who are not members of a designated voluntary association do not share in its responsibilities or privileges. The Coast Guard also determined that Menkes had no right to serve as an independent pilot during the 2004 navigation season, because, as of December 2003, the SLSPA appeared to have a sufficient number of pilots to provide pilotage service for the upcoming season.

Menkes again sought relief in the District Court. After reviewing cross-motions for summary judgment, the District Court rejected Menkes's claims and granted judgment to the Government. Menkes v. Dep't of Homeland Sec. (" Menkes III " ), 662 F.Supp.2d 62 (D.D.C.2009). On Menkes's APA claim, the District Court held that the Coast Guard reasonably concluded that Menkes's term of service as an independent pilot expired in 2003, and that Menkes had no entitlement to reassignment in 2004. The District Court also held that issue preclusion barred Menkes's First Amendment claim because the Second Circuit had ruled against Menkes on the same issue in a suit against the SLSPA. Menkes v. SLSPA (" SLSPA " ), 269 Fed.Appx. 54 (2d Cir.2008). Finally, the District Court rejected Menkes's Fifth Amendment due process claim because he failed to demonstrate a viable property interest in an appointment to serve as a pilot in a specific area. Menkes timely appealed.

We affirm the judgment of the District Court. First, we hold that the Coast Guard's interpretation of the term " voluntary association" in 46 U.S.C. § 9304 easily survives review under Chevron Step Two. See Chevron U.S.A. Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837, 843-44, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984) (holding that, once a court determines that Congress either explicitly or implicitly delegated to an agency the authority to fill a gap in its authorizing statute, the court must accept the agency's position if it is

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based on a " permissible" interpretation of the statute). Second, we agree with the District Court that Menkes's First Amendment claim appears to be precluded by the Second Circuit's judgment. In any event, the claim fails on the merits. Third, we hold that the Coast Guard did not act arbitrarily and capriciously in determining that Menkes's dispatch as an independent pilot expired after the 2003 navigation season. Fourth, we reject Menkes's Fifth Amendment due process claim, because Menkes had no constitutionally protected entitlement to continued dispatch by the Coast Guard. Finally, we hold that the District Court did not abuse its discretion in denying Menkes's request for extra-record discovery.

I. BACKGROUND

A. Statutory and Regulatory Background

In 1960, Congress passed the GLPA in order " to establish pilotage requirements for oceangoing vessels in their navigation of U.S. waters of the Great Lakes and St. Lawrence River and to provide a basis for a regulated pilotage system to meet those requirements." H.R.REP. NO. 86-1666, at 1 (1960), reprinted in 1960 U.S.C.C.A.N. 2481, 2481. The statute, as amended, requires both U.S. and foreign vessels in these waters to " engage a United States or Canadian registered pilot for the route being navigated," 46 U.S.C. § 9302, and requires the Coast Guard to prescribe " standards of competency" that each applicant must meet in order to become a United States registered pilot, id. § 9303. Most pertinent to this appeal, it provides that:

(a) The Secretary may authorize the formation of a pool by a voluntary association of United States registered pilots to provide for efficient dispatching of vessels and rendering of pilotage services.

(b) For pilotage pools, the Secretary may—

(1) limit the number of the pools;

(2) prescribe regulations for their operation and administration;

(3) prescribe a uniform system of accounts;

(4) perform audits and inspections; and

(5) require coordination on a reciprocal basis with similar pool arrangements authorized by the appropriate agency of Canada.

Id. § 9304.

The Coast Guard has promulgated several regulations pursuant to the GLPA. Two of these regulations are particularly important here: one, 46 C.F.R. § 401.300, authorizes voluntary associations of U.S. registered pilots to establish pools in three districts of the U.S. waters of the Great Lakes; the other, 46 C.F.R. § 401.720(b), provides that " [w]hen pilotage service is not provided by the association authorized under 46 U.S.C. 9304 because of a physical or economic inability to do so, ... the Director [of Great Lakes Pilotage of the Coast Guard] may order any U.S. registered pilot to provide pilotage service." Only District One— which covers portions of the St. Lawrence River and Lake Ontario— is at issue in this case. Id. § 401.300(a)(1); see also Decl. of Paul M. Wasserman ¶ ¶ 10-11 (May 28, 2008), reprinted in Joint Appendix (" J.A." ) 455-56.

District One is comprised of two areas: the waters in Area 1, which include portions of the St. Lawrence River, and the waters in Area 2, which include Lake Ontario. Decl. of Paul M. Wasserman ¶ ¶ 10-11 (May 28, 2008), J.A. 455-56. A single pilot can be qualified to navigate vessels in both areas, although Area 2 pilots must be qualified to navigate a vessel both into a port and from " pilot boat to pilot boat,"

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i.e., a vessel that is only passing through Lake Ontario. Id. ¶ 17, J.A. 459.

B. Procedural Background

At all times relevant to this litigation, the SLSPA was the only pilotage pool authorized by the Coast...

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