Center for Auto Safety v. Nat. Highway Traffic

Decision Date23 June 2006
Docket NumberNo. 04-5402.,04-5402.
Citation452 F.3d 798
PartiesCENTER FOR AUTO SAFETY and Public Citizen, Inc., Appellants v. NATIONAL HIGHWAY TRAFFIC SAFETY ADMINISTRATION, Appellee.
CourtU.S. Court of Appeals — District of Columbia Circuit

Bonnie I. Robin-Vergeer argued the cause for appellants. With her on the briefs was Allison M. Zieve.

Jane M. Lyons, Assistant U.S. Attorney, argued the cause for appellee. With her on the brief were Kenneth L. Wainstein, U.S. Attorney, Michael J. Ryan, Assistant U.S. Attorney, and Lloyd S. Guerci, Assistant Chief Counsel, National Highway Traffic Safety Administration. R. Craig Lawrence, Assistant U.S. Attorney, entered an appearance.

Before: RANDOLPH and GRIFFITH, Circuit Judges, and EDWARDS, Senior Circuit Judge.

Opinion for the Court filed by Senior Circuit Judge EDWARDS.

Concurring opinion filed by Circuit Judge RANDOLPH.

EDWARDS, Senior Circuit Judge.

The National Highway Traffic Safety Administration Authorization Act of 1991 ("Safety Act" or "Act"), 49 U.S.C. §§ 30,101 et seq. (2000), allows automakers to initiate voluntary "recalls" when a motor vehicle or its equipment contains a safety-related defect or does not comply with applicable safety standards. 49 U.S.C. § 30,118(c). Generally, vehicle owners who are afforded recall notification of a safety-related defect or noncompliance are entitled to a free remedy from the manufacturer. The National Highway Traffic Safety Administration ("NHTSA") administers the Safety Act and monitors manufacturer-initiated recalls.

Beginning sometime in the mid-1980s, automakers adopted a practice of initiating "regional recalls." Under this practice, when a safety-related defect was caused by exposure to atypical climatic conditions, automakers gave notification and free remedies only in regions experiencing the climatic conditions that caused the identified safety-related defect. For example, if vehicle components corroded when exposed to salt, manufacturers limited their recalls to owners in states that used the most salt on their roads. In 1997, Kenneth N. Weinstein, NHTSA's Associate Administrator for Safety Assurance, sent letters to some major automakers and a trade association, acknowledging that regional recalls had been authorized in the past, but stating that the agency now had "concerns" about the practice. See 1997 Letters from NHTSA to Manufacturers and Trade Associations, reprinted in Joint Appendix ("J.A.") 136-38. In 1998, Kenneth N. Weinstein and other NHTSA officials sent letters to various motor vehicle manufacturers outlining NHTSA's "policy guidelines" for "regional recalls." See, e.g., Generic Version of 1998 Letter from NHTSA to Manufacturers at 1, reprinted in J.A. 80 (hereafter "1998 policy guidelines" or "guidelines").

On March 10, 2004, Center for Auto Safety ("CAS") and Public Citizen, Inc. ("Public Citizen") filed a lawsuit in District Court challenging the "regulatory regime governing regional recalls established in NHTSA's 1998 letter to automakers." Br. for Appellants at 16. Appellants claimed that the 1998 policy guidelines constitute a "de facto legislative rule" that violates the Safety Act, and that, even if regional recalls are permissible in some circumstances, the policy statement violates the Administrative Procedure Act ("APA"), 5 U.S.C. §§ 551 et seq. (2000), "because it is arbitrary and capricious and was promulgated without public notice and comment." Br. for Appellants at 16. The District Court dismissed the complaint for failure to state a claim. We affirm.

Appellants' claims are not reviewable. See 5 U.S.C. § 704 (judicial review under APA is limited to final agency action). For agency action to be "final" and reviewable under the APA, it must generally "mark the consummation of the agency's decisionmaking process" and either determine "rights or obligations" or result in "legal consequences." Bennett v. Spear, 520 U.S. 154, 178, 117 S.Ct. 1154, 137 L.Ed.2d 281 (1997) (citations and internal quotation marks omitted). The disputed 1998 policy guidelines do not establish any binding rules, and they are not finally determinative of the issues to which they are addressed. Therefore, the guidelines are not subject to review. Accordingly, we affirm the judgment of the District Court.

I. BACKGROUND
A. The Statutory Framework

The statutory provisions at issue in this case were first enacted by Congress with the passage of the National Traffic and Motor Vehicle Safety Act of 1966, which sought "to reduce traffic accidents" by regulating the safety of motor vehicles. Pub.L. No. 89-563, 80 Stat. 718, 718 (originally codified at 15 U.S.C. §§ 1381 et seq. (1970)). In 1994, that statute was repealed, reenacted, and recodified without material change as part of the National Highway Traffic Safety Administration Authorization Act of 1991. See Pub.L. No. 103-272, 108 Stat. 745, 1379, 1385 (1994) (repealing); id. at 745, 941-73 (1994) (reenacting and recodifing without substantive changes). Administration of the Safety Act has been delegated to the Secretary of Transportation, who, in turn, has re-delegated his duties under the Act to NHTSA. See 49 C.F.R. §§ 1.50(a), 501.2(a)(1) (2005).

The Safety Act includes provisions governing situations when a motor vehicle or its equipment contains a safety-related defect or does not comply with an applicable safety standard. See 49 U.S.C. §§ 30,118-30,121. In these situations, the Act requires manufacturers to issue a "recall," providing both notice of the safety-related defect or noncompliance and a free remedy to owners, purchasers, and dealers of the vehicle. 49 U.S.C. §§ 30,118-30,120. The Act allows two exceptions to the recall requirements. First, "[t]he requirement that a remedy be provided without charge does not apply if the motor vehicle or replacement equipment was bought by the first purchaser more than 10 calendar years . . . before notice is given." 49 U.S.C. § 30,120(g)(1). Second, a manufacturer may obtain an exemption from the remedy requirements if, after providing notice and opportunity for public comment, NHTSA determines that "a defect or noncompliance is inconsequential to motor vehicle safety." 49 U.S.C. § 30,120(h); see also Exemption for Inconsequential Defect or Noncompliance, 49 C.F.R. pt. 556 (2005).

A recall is triggered in one of two ways. First, NHTSA may initiate administrative enforcement proceedings under the Act. The Act provides as follows:

(a) NOTIFICATION BY SECRETARY.—The Secretary of Transportation shall notify the manufacturer of a motor vehicle or replacement equipment immediately after making an initial decision (through testing, inspection, investigation, or research carried out under this chapter, examining communications under section 30166(f) of this title, or otherwise) that the vehicle or equipment contains a defect related to motor vehicle safety or does not comply with an applicable motor vehicle safety standard prescribed under this chapter. The notification shall include the information on which the decision is based. The Secretary shall publish a notice of each decision under this subsection in the Federal Register. Subject to section 30167(a) of this title, the notification and information are available to any interested person.

(b) DEFECT AND NONCOMPLIANCE PROCEEDINGS AND ORDERS.—

(1) The Secretary may make a final decision that a motor vehicle or replacement equipment contains a defect related to motor vehicle safety or does not comply with an applicable motor vehicle safety standard prescribed under this chapter only after giving the manufacturer an opportunity to present information, views, and arguments showing that there is no defect or noncompliance or that the defect does not affect motor vehicle safety. Any interested person also shall be given an opportunity to present information, views, and arguments.

(2) If the Secretary decides under paragraph (1) of this subsection that the vehicle or equipment contains the defect or does not comply, the Secretary shall order the manufacturer to—

(A) give notification under section 30119 of this title to the owners, purchasers, and dealers of the vehicle or equipment of the defect or noncompliance; and

(B) remedy the defect or noncompliance under section 30120 of this title.

49 U.S.C. § 30,118(a)-(b).

Second, a vehicle manufacturer may voluntarily initiate a recall. For this alternative, the Act provides as follows:

(c) NOTIFICATION BY MANUFACTURER.—A manufacturer of a motor vehicle or replacement equipment shall notify the Secretary by certified mail, and the owners, purchasers, and dealers of the vehicle or equipment as provided in section 30119(d) of this section, if the manufacturer—

(1) learns the vehicle or equipment contains a defect and decides in good faith that the defect is related to motor vehicle safety; or

(2) decides in good faith that the vehicle or equipment does not comply with an applicable motor vehicle safety standard prescribed under this chapter.

49 U.S.C. § 30,118(c). A manufacturer typically begins a voluntary recall by filing a "Part 573 Report," notifying the agency of its concerns and proposing a remedial program. See 49 C.F.R. § 573.6 (2005); see also 49 C.F.R. § 573.5 (1998) (reporting requirements for defects and noncompliance between 1996 and 2002). The manufacturer is then required to notify "each person registered under State law as the owner [of an affected vehicle] and whose name and address are reasonably ascertainable by the manufacturer through State records or other available sources," 49 U.S.C. § 30,119(d)(1)(A), or, failing that, "the most recent purchaser known to the manufacturer," 49 U.S.C. § 30,119(d)(1)(B). When a manufacturer undertakes a voluntary recall, this also entails an obligation to "remedy the defect or noncompliance." 49 U.S.C. § 30,120(a)(1).

Even though voluntary recalls are initiated by a manufacturer, NHTSA retains full authority under the Act to...

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