City of Los Angeles v. County of Kern

• Decision Date: 19 March 2009
• Docket Number: No. 07-56564.,07-56564.
• Citation: 581 F.3d 841
• Parties: CITY OF LOS ANGELES; Orange County Sanitation Districts; Responsible Biosolids Management, Inc.; R & G Fanucchi Inc.; Sierra Transport Inc.; California Association of Sanitation Agencies; Shaen Magan, individually and dba's Honey Bucket Farms; Tule Ranch/Magan Farms; Western Express Inc., Plaintiffs-Appellees, and Kern County Water Agency; Association of Irritated Residents; Arvin-Edison Water Storage District; Kern Water Bank Authority, Intervenors, v. COUNTY OF KERN; Kern County Board of Supervisors, Defendants-Appellants.
• Court: U.S. Court of Appeals — Ninth Circuit

581 F.3d 841

CITY OF LOS ANGELES; Orange County Sanitation Districts; Responsible Biosolids Management, Inc.; R & G Fanucchi Inc.; Sierra Transport Inc.; California Association of Sanitation Agencies; Shaen Magan, individually and dba's Honey Bucket Farms; Tule Ranch/Magan Farms; Western Express Inc., Plaintiffs-Appellees, and Kern County Water Agency; Association of Irritated Residents; Arvin-Edison Water Storage District; Kern Water Bank Authority, Intervenors, v. COUNTY OF KERN; Kern County Board of Supervisors, Defendants-Appellants.

No. 07-56564.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted March 2, 2009.

Submission Vacated March 19, 2009.

Resubmitted and Filed September 9, 2009.

Steven L. Mayer, Howard Rice Nemerovski Canady Falk & Rabkin, San Francisco, CA, argued the cause for defendants-appellants and filed the briefs. Jerome B. Falk, Jr. and Adam Polakoff, Howard Rice Nemerovski Canady Falk & Rabkin, San Francisco, CA; Bernard C. Barmann and Stephen D. Schuett, County of Kern, Bakersfield, CA; and Michael M. Hogan, Hogan Guiney Dick LLP, San Diego, CA, were also on the briefs.

Thomas S. Hixon, Bingham McCutchen LLP, Los Angeles, CA, argued the cause for plaintiffs-appellees and was on the briefs. James J. Dragna and Marc R. Bruner, Bingham McCutchen LLP, Los Angeles, CA; Rockard J. Delgadillo, Christopher M. Westhoff, and Keith W. Pritsker, City of Los Angeles, Los Angeles, CA; James B. Slaughter and Gary J. Smith, Washington, DC; Daniel V. Hyde and Paul J. Beck, Lewis Brisbois Bisgaard & Smith LLP, Los Angeles, CA; Bradley R. Hogin, Woodruff Spradlin & Smart, Orange, CA; Michael J. Lampe, Law Offices of Michael J. Lampe, Visalia, CA; and Roberta L. Larson and Jonathan Schutz, Somach Simmons & Dunn, Sacramento, CA, were also on the briefs.

James Sullivan, Water Environment Federation, Alexandria, VA, filed a brief on behalf of Amicus Curiae Water Environment Federation.

Keith J. Jones, National Association of Clean Water Agencies, Washington, DC, filed a brief on behalf of Amicus Curiae National Association of Clean Water Agencies. Nathan Gardner-Andrews, National Association of Clean Water Agencies, Washington, DC, was also on the brief.

Appeal from the United States District Court for the Central District of California, Gary A. Feess, District Judge, Presiding. D.C. Nos. CV-06-05094-GAF, 2:06-cv-05094-GAF-VBK.

Before: DIARMUID F. O'SCANNLAIN, PAMELA ANN RYMER, and KIM McLANE WARDLAW, Circuit Judges.

O'SCANNLAIN, Circuit Judge:

We must decide whether recyclers challenging a local ordinance that bans a particular method of waste disposal have prudential standing to raise its constitutionality under the dormant Commerce Clause.

I

A

The fact that the subject matter of the case before us involves sewage sludge will be of no surprise to those familiar with the negative implications of the Commerce Clause. For our purposes, sludge is the "solid, semi-solid, or liquid residue generated during the treatment of domestic sewage." 40 C.F.R. § 503.9(w). Here, we deal with the "land application" of "biosolids": essentially, a particular recycling method which involves the use of treated sludge as fertilizer.¹ See 40 C.F.R. § 503.11(h) ("Land application is the spraying or spreading of sewage sludge onto the land surface; the injection of sewage sludge below the land surface; or the incorporation of sewage sludge into the soil so that the sewage sludge can either condition the soil or fertilize crops or vegetation grown in the soil.").

In 2006, voters in Kern County, California ("Kern"), adopted a local ordinance ("Measure E" or the "Ordinance") by ballot initiative that makes it "unlawful for any person to Land Apply Biosolids to property within the unincorporated area of the County." Violation of the Ordinance is a misdemeanor punishable by "a fine of not more than $500 or by imprisonment of not more than six months." By its terms, the Ordinance applies to both in-county and out-of-county waste generators. In practical effect, however, because Kern does not currently apply its biosolids to land within the county, Measure E does not directly impact Kern's own waste disposal programs.

Prior to the Ordinance, in-state waste generators frequently disposed of their biosolids by land application at various farms throughout the unincorporated area of Kern County.² For example, the City of Los Angeles, Orange County Sanitation District, and County Sanitation District No. 2 of Los Angeles County ship large amounts of waste generated by their residents to Green Acres, Honey Bucket Farms, and Tule Ranch. If these generators were precluded from land applying their biosolids in Kern County, they would be required to find alternative locations to dispose of their sludge. They have submitted declarations pointing to Arizona as a probable destination, and asserting that this site change would result in increased transportation costs.

B

These out-of-county generators, along with waste transporters and in-county farmers (collectively, "the recyclers"), filed suit in the United States District Court for the Central District of California. They alleged that Measure E violated the dormant Commerce Clause and the Equal Protection Clause and was preempted by the Federal Clean Water Act, the California Integrated Waste Management Act ("CIWMA"), and the California Water Code. They also asserted that it constituted an invalid exercise of Kern's police power. The district court initially dismissed the Clean Water Act and the California Water Code claims under Federal Rule of Civil Procedure 12(b)(6), while granting the recyclers' request for a preliminary injunction halting enforcement of Measure E. The parties filed cross motions for summary judgment.

The district court granted Kern's motion for summary judgment on the recyclers' equal protection claim, and denied summary judgment on the police power claim, citing the existence of disputed facts. As for the dormant Commence Clause, the district court concluded that Measure E discriminated against interstate commerce in effect. Accordingly, the court applied strict scrutiny, determined the Ordinance could not survive, and granted summary judgment in favor of the recyclers. The district court also exercised supplemental jurisdiction over the recyclers' CIWMA claim under 28 U.S.C. § 1367 and held that Measure E was preempted by state law.

Kern timely filed this appeal, challenging only the district court's rulings on the dormant Commerce Clause and state-law preemption claims.

II

We first assess whether the recyclers have standing to bring suit under the dormant Commerce Clause. That inquiry involves "both constitutional limitations on federal-court jurisdiction and prudential limitations on its exercise." Warth v. Seldin, 422 U.S. 490, 498, 95 S.Ct. 2197, 45 L.Ed.2d 343 (1975). "Constitutional [or `Article III'] standing concerns whether the plaintiff's personal stake in the lawsuit is sufficient to make out a concrete `case' or `controversy' to which the federal judicial power may extend under Article III, § 2." Pershing Park Villas Homeowners Ass'n v. United Pac. Ins. Co., 219 F.3d 895, 899 (9th Cir.2000); see also Lujan v. Defenders of Wildlife, 504 U.S. 555, 559-60, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992). These limits are jurisdictional: they cannot be waived by any party, and there is no question that a court can, and indeed must, resolve any doubts about this constitutional issue sua sponte. See, e.g., Indep. Living Ctr. of S. Cal., Inc. v. Shewry, 543 F.3d 1050, 1064-65 (9th Cir.2008). Here, no party contends the recyclers lack Article III standing, and we are independently satisfied that they have met the requirements of Lujan.

Over and above the limits of Article III, however, there exists a body of "judicially self-imposed limits on the exercise of federal jurisdiction," Allen v. Wright, 468 U.S. 737, 751, 104 S.Ct. 3315, 82 L.Ed.2d 556 (1984), "founded in concern about the proper — and properly limited — role of the courts in a democratic society," Warth, 422 U.S. at 498, 95 S.Ct. 2197. Citing their nonconstitutional nature, we have previously held that these requirements, commonly referred to as "prudential" standing, "can be deemed waived if not raised in the district court." Bd. of Natural Res. v. Brown, 992 F.2d 937, 946 (9th Cir.1993).³

A

Because Kern admittedly failed to raise prudential standing before the district court,⁴ we must satisfy ourselves that we should address the matter in the first instance. At times, we have exercised our prerogative to "deem" this issue waived in such circumstances. See, e.g., Laub v. U.S. Dep't of Interior, 342 F.3d 1080, 1087 n. 6 (9th Cir.2003); Pershing Park, 219 F.3d at 899-900. Past practice, however, does not preclude our consideration of the subject in the case at hand. Rather, the permissive language in our caselaw — "can be deemed" — indicates that the choice to reach the question lies within our discretion. We are also mindful of the Supreme Court's description of constitutional and prudential standing as "threshold determinants of the propriety of judicial intervention." Warth, 422 U.S. at 518, 95 S.Ct. 2197.

The Seventh Circuit's opinion in MainStreet Organization of Realtors v. Calumet City, 505 F.3d 742 (7th Cir.2007), is instructive. In that case, the court reached the issue of prudential standing, despite the "wrinkle" that "the City did not argue [prudential standing] until [the panel] raised the issue at oral argument." Id. at 747. "[N]onconstitutional lack of standing," according to the Seventh Circuit, "belongs to an intermediate class of cases in which a court can notice an error and reverse on the basis of it even though no party has noticed it and the error is not jurisdictional, at least in the conventional sense." Id.; see also id. at 747-48 (citing failure to exhaust state remedies in habeas cases and abstention as examples); cf. Tenet v. Doe, 544 U.S. 1, 6 n. 4, ...