Detroit Int'l Bridge Co. v. Gov't of Can.
Decision Date | 21 June 2016 |
Docket Number | Civil Action No. 10-476 (RMC) |
Citation | 192 F.Supp.3d 54 |
Parties | DETROIT INTERNATIONAL BRIDGE COMPANY, et al., Plaintiffs, v. GOVERNMENT OF CANADA, et al., Defendants. |
Court | U.S. District Court — District of Columbia |
Amy Lynn Neuhardt, Hamish P.M. Hume, Boies, Schiller & Flexner LLP, Robert Allen Sedler, Wayne State University Law School, Detroit, MI, Patrick A. Moran, Detroit International Bridge Company, Warren, MI, for Plaintiffs.
Douglas A. Dozeman, Eugene E. Smary, Scott M. Watson, Warner Norcross & Judd LLP, Grand Rapids, MI, Brian Matthew Collins, Davene Dashawn Walker, U.S. Department of Justice, Peter Christopher Whitfield, Hogan Lovells, Washington, DC, for Defendants.
During the past six and a half years, Detroit International Bridge Company and its wholly-owned subsidiary, the Canadian Transit Company (collectively DIBC), have litigated this case to prevent the proposed construction of a new publicly-owned bridge between Detroit Michigan and Windsor Ontario. The new bridge, known as the New International Transit Crossing/Detroit River International Crossing (NITC/DRIC), could take away a substantial percentage of the traffic between the United States and Canada from DIBC's Ambassador Bridge.1 It could also threaten the financial viability of DIBC's plans to build an adjacent Twin Span to provide a modern bridge crossing while DIBC repairs and modernizes the Ambassador Bridge.
This Court has previously dismissed all but one of the claims in the Third Amended Complaint (TAC), Dkt. 105. See May 26, 2016 Mem. Op. and Order [Dkts. 269 & 270] ( ); April 7, 2016 Order [Dkt. 255] ( ); September 30, 2015 Mem. Op. and Order [Dkt. 222 & 223] ( Counts 1, 2, 3, 5, 6, 8, and 9).
Only Count 7 remains. It alleges that the U.S. Department of State (USDS) violated the Administrative Procedure Act (APA), 5 U.S.C. § 706(2), when it approved the NITC/DRIC Crossing Agreement. The parties have cross-moved for summary judgment and the merits of Count 7 are now before the Court.2 For the reasons that follow, the Court will grant the Federal Defendants' Motion for Summary Judgment on Count 7 and deny DIBC's Cross Motion for Summary Judgment.
At the very heart of Count 7 is the Crossing Agreement between Michigan and Canada to "design, construct, finance, operate, and maintain" the NITC/DRIC, which is to be located two miles from the Ambassador Bridge over the Detroit River. See Admin. Record [Dkt. 226] at STATEDEPT-AR0000110. The International Bridge Act of 1972 (IBA), 33 U.S.C. § 535 et seq ., provides in relevant part that:
33 U.S.C. § 535(a) (emphasis added). Pursuant to this section of the IBA, the Government of Canada, the Governor of Michigan, the Michigan Department of Transportation (MDOT), and the Michigan Strategic Fund (MSF) executed the Crossing Agreement. In June 2012, the Governor of Michigan submitted an application to USDS for a Presidential Permit to build the NITC/DRIC, as required by the IBA. See Admin. Record [Dkt. 226] at STATEDEPT-AR0000001 and AR0000109-162.4 The Governor also sought approval of the Crossing Agreement by USDS. See id.
On July 11, 2012, USDS published a notice in the Federal Register soliciting comments on the permit application, which included the Crossing Agreement. See Notice of Receipt of Application for Presidential Permit for the Construction of a New International Trade Crossing, 77 Fed. Reg. No. 40937 (July 11, 2012). The public comment period ran until September 10, 2012 and USDS received over 14,000 comments. See STATEDEPT-AR0000363 and AR0000225. DIBC "submitted a Comment on August 9, 2012 and a Supplemental Comment on September 10, 2012 ... both of which explained to the State Department that it should promptly reject the NITC/DRIC Application for a number of reasons, including that ... [it] sought approval of an agreement illegally executed by the Governor, MDOT, and MSF." TAC ¶ 261; see also STATEDEPT-AR0012008-32; AR0025102-05. Other commenters, including some Michigan legislators, also questioned the validity of the Crossing Agreement on the basis that MDOT, MSF, and the Governor lacked the necessary authority under state law to execute the Agreement. See, e.g. , STATEDEPT-AR0028367; AR0028564; AR0028443; AR0028637; AR0028625; AR0028539; AR 0028504; AR0000461-77; AR0000492-94; AR0015045-47.5
In light of these comments, USDS requested the "views of the Michigan State Attorney General" regarding whether "the Governor, MDOT or MSF require authorization or approval of the Michigan State legislature to execute the Crossing Agreement, to bring it into effect, or to implement it." STATEDEPT-AR0000363. USDS also asked whether there were "any additional legislative authorizations or approvals required for the planning, construction, or operation of the NITC." Id. USDS received responses that stated, among other things, that "the Attorney General ha[d] concluded that no further legislative action [was] required to execute the Crossing Agreement, bring it into effect or implement it" and "no further legislative approvals [were] necessary for the planning, construction, or operation of the NITC." STATEDEPT-AR0000365; see also STATEDEPT-AR0000380-383 ( ). DIBC characterizes the letters as "conclusory, self-serving, and completely without analysis." Pls. Mot. at 13. DIBC disagrees with the interpretation of Michigan law provided by the Offices of the Governor and the Attorney General concerning the validity of the Crossing Agreement.6
On March 25, 2013, USDS signed a Record of Decision supporting its approval of the Crossing Agreement and, on April 12, 2013, notified the Governor of Michigan that the Agreement had been approved. See STATEDEPT-AR0000222; AR 0000385. On April 18, 2013, USDS published a notice in the Federal Register that it had issued a Presidential Permit to build the NITC/DRIC. See Issuance of a Presidential Permit to the State of Michigan, 78 Fed. Reg. 23253 (April 18, 2013).
On September 30, 2015, this Court rejected Federal Defendants' arguments that DIBC lacked standing to challenge approval of the Crossing Agreement by USDS and that the approval was unreviewable agency action under the APA. See September 30, 2015 Mem. Op. [Dkt. 222]. As a result, the Court denied Federal Defendants' Motion to Dismiss Count 7. See September 30, 2015 Order [Dkt. 223].
On summary judgment, the sole question is whether approval of the Crossing Agreement by USDS violated the APA. See TAC Count 7 at 106 (titled, "APA Claims Based on Approval of Crossing Agreement—State Department Defendants"). Count 7 alleges that USDS violated the APA because "it approved an agreement that was entered into in violation of Michigan law." TAC ¶ 357.7 Specifically, Count 7 alleges that, since the Crossing Agreement was illegal under Michigan Law, its approval by USDS was "contrary to law" because approving unlawful agreements violates the U.S. Constitution and the IBA. Id. Count 7 also alleges in passing that, the "approval of the [illegal] Crossing Agreement [was] also arbitrary and capricious and in violation of the other standards set forth in 5 U.S.C. § 706(2)." Id. The parties disagree as to the applicable standard of review, as well as the nature of the APA claim.
The APA provides in relevant part that:
5 U.S.C. § 706(2).
Count 7 alleges that the approval of the Crossing Agreement was arbitrary and capricious and contrary to the U.S. Constitution and the IBA. See TAC ¶ 357. In its Motion for Summary Judgment, Federal Defendants rely on the APA's "highly deferential standard," under which a court "may set aside [the agency's] action ‘only if it is arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.’ " Zevallos v. Obama , 793 F.3d 106, 112 (D...
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