District No. 1 v. Maritime Admin

• Decision Date: 16 June 2000
• Docket Number: P,No. 99-1517,No. 1,1,99-1517
• Citation: 215 F.3d 37
• Parties: (D.C. 2000) Districtacific Coast District, Marine Engineers' Beneficial Association, Petitioner v. Maritime Administration, et al.,Respondents BLNG, Inc., et al.,Intervenors
• Court: U.S. Court of Appeals — District of Columbia Circuit

Page 37

215 F.3d 37 (D.C. 2000)

District No. 1, Pacific Coast District, Marine Engineers' Beneficial Association, Petitioner v. Maritime Administration, et al.,Respondents

BLNG, Inc., et al.,Intervenors

No. 99-1517

United States Court of Appeals FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued May 17, 2000

Decided June 16, 2000

[Copyrighted Material Omitted]

On Petition for Review of an Order of the Federal Maritime Administration

Thomas L. Mills argued the cause for petitioner. With him on the briefs were Constantine G. Papavizas, William A. Anderson, II and W. Patrick Morris.

Bruce G. Forrest, Attorney, U.S. Department of Justice, argued the cause for respondent. With him on the brief were David W. Ogden, Acting Assistant Attorney General, Douglas N. Letter and Robert S. Greenspan, Attorneys, John Patrick Wiese and John G. Salisbury, Attorneys, U.S. Department of Transportation. Edward Himmelfarb, Attorney, U.S. Department of Justice, entered an appearance.

Michael Joseph argued the cause for intervenor. With him on the brief were E. Alex Blanton and Joseph O. Click.

Before: Ginsburg, Sentelle and Garland, Circuit Judges.

Opinion for the court filed by Circuit Judge Ginsburg.

Ginsburg, Circuit Judge:

Pursuant to 9 of the Shipping Act, 1916, the Maritime Administration (MarAd) conditionally granted applications to transfer the registry of eight vessels from the United States to the Republic of the Marshall Islands. District No. 1, Pacific Coast District, Marine Engineers' Beneficial Association, the collective bargaining representative for the licensed officers on the vessels, along with certain of its members (hereinafter collectively, the Union), petitioned for review. The Union claims that: (1) the MarAd's decision was arbitrary and capricious; (2) the MarAd accepted and relied upon ex parte communications in violation of both the Administrative Procedure Act, 5 U.S.C. 551 et seq., and the Fifth Amendment to the Constitution of the United States; and (3) 9 of the Shipping Act is an unconstitutional delegation of legislative authority. Because we lack jurisdiction over the claims based upon the APA, we dismiss the petition in part. In all other respects we deny the petition: MEBA did not properly raise its Fifth Amendment argument and 9 of the Shipping Act is not an unconstitutional delegation of authority.

I. Background

Section 9 of the Shipping Act prohibits the owner of a vessel from transferring its registry out of the United States without the approval of the Secretary of Transportation. See 46 U.S.C. App. 808(c)(2). The Secretary has delegated his authority under that section to the MarAd, 49 C.F.R. 1.66(a), which has in turn promulgated regulations implementing the approval requirement. The regulations provide in pertinent part:

(b) Vessels of 1,000 gross tons or more.

(1) Applications for approval of Transfer to foreign registry and flag ... of Documented Vessels or vessels the last documentation of which was under the laws of the United States and which are of 1,000 gross tons or more will be evaluated in light of--

(i) The type, size[,] speed, general condition, and age of the vessel;

(ii) The acceptability of the owner, proposed transferee and the country of registry ...; and

(iii) The need to retain the vessel under U.S. documentation, ownership or control for purposes of national defense, maintenance of an adequate merchant marine, foreign policy considerations or the national interest.

46 C.F.R. 221.15(b).

BLNG applied to the MarAd for permission to transfer the registry of eight vessels from the United States to the Republic of the Marshall Islands. Although not required by statute or regulation to do so, the MarAd published in the Federal Register notice of the applications and a call for comments thereon. After the announced period for the submission of comments had ended, however, the MarAd accepted additional comments from, among others, BLNG and its attorneys.

In its decision the MarAd canvassed the arguments put forth in the comments and determined that the following regulatory criteria were relevant to its decision: (1) the general condition of the vessels; (2) the acceptability of the Republic of the Marshall Islands; (3) national defense; (4) the maintenance of an "adequate merchant marine"; (5) "foreign policy considerations"; and (6) other aspects of the "national interest."

The MarAd applied these criteria as follows: (1) The vessels, which are used to ship liquified natural gas, are in good working condition. (2) The agency has previously found the Republic of the Marshall Islands to be an acceptable transferee. (3) The Department of Defense, upon the MarAd's inquiry, determined that the vessels are not necessary for national defense; in any event, the transfer was conditioned so that the vessels could be returned to the United States if needed in an emergency. (4) Maintenance of an adequate merchant marine does not require retaining the vessels. The Department of Energy confirmed there are no current projects planned that would require the vessels and, although some jobs might be lost to United States seamen because of the transfer, BLNG has agreed for at least five years to maintain crews composed significantly of United States seamen on six of the eight vessels. (5) The Department of State informed the MarAd that no foreign policy consideration required retaining the vessels in United States registry. (6) The national interest did not otherwise require retaining the vessels, primarily because the Republic of the Marshall Islands adequately regulates safety aboard vessels and the crew will continue to be composed mainly of United States seamen.

II. Analysis

As indicated above, the Union raises three objections to the MarAd's order: (1) It is arbitrary and capricious and therefore invalid under the APA; (2) the MarAd's acceptance of and reliance upon ex parte comments violated both the APA and the Fifth Amendment; and (3) 9 is an unconstitutional delegation of lawmaking authority. Before reaching the merits of those arguments, we address whether the Union has standing to raise them.

BLNG contends that the Union lacks standing under Article III of the Constitution because it has demonstrated neither a legally significant injury nor that the MarAd's order is the cause of any injury the Union may have suffered. BLNG also maintains that the Union lacks prudential standing to sue under 9 of the Shipping Act because the interests the Union is seeking to protect are not "arguably within the zone of interests to be protected or regulated by" 9.Reytblatt v. NRC, 105 F.3d 715, 721 (D.C. Cir. 1997).

BLNG does not dispute that, as a result of the MarAd's order, some of the Union's members among the crews will lose their jobs and the Union will be displaced as the exclusive bargaining representative. That is surely enough to give the Union standing for the purposes of Article III. In addition, the Union's claimed interest in "maintaining and promoting jobs in the U.S. merchant marine to service this nation's economic and national defense needs" is arguably within the zone of interests protected by 9. The preamble to the Shipping Act states as its purposes in creating the MarAd's predecessor "encouraging, developing, and creating a naval auxiliary and naval reserve and a merchant marine," 39 Stat. 728 (1916), and the MarAd reasonably concluded in its order that a meaningful merchant marine is one with "a trained and efficient citizen personnel." See also Meacham Corp. v. United States, 207 F.2d 535, 542-43 (4th Cir. 1953) (tracing legislative history of and amendments to Shipping Act). Indeed, the MarAd's organic statute provides that "the United States shall have a merchant marine ... operated under the United States flag by citizens of the United States insofar as may be practicable." 46 U.S.C. App. 1101. We therefore conclude that the Union clearly has demonstrated both the injury in fact and the causation necessary to give it constitutional standing and that its interests are arguably within the zone of interests protected by 9.

A. Claims based upon the APA

The Union first contends that MarAd's order is invalid under the APA because it is arbitrary and capricious. See 5 U.S.C. 706(2)(A). The MarAd responds that decisions regarding transfers of registry are "committed to agency discretion by law," 5 U.S.C. 701(a)(2), and therefore outside the range of judicial review authorized in the APA. If the MarAd is correct, then this court lacks jurisdiction over the Union's claims based upon the APA. See, e.g., ICC v. Brotherhood of Locomotive Engineers, 482 U.S. 270, 282, 287 (1987).

The MarAd concedes that its regulations provide specific criteria to govern its decisions regarding transfers of registry, but contends that, as in National Federation of Federal Employees v. United States, 905 F.2d 400 (D.C. Cir. 1990) (NFFE), the subject matter of the agency's decision does not admit of judicially manageable standards. We agree. In NFFE, we were asked to review an APA challenge to the closure of certain military bases. The Secretary of Defense had created a Commission on Base Realignment and Closure and directed it to "identify which bases should be closed or realigned." Id. at 402. The Secretary listed nine criteria upon the basis of which the Commission was to make its recommendations, see id., but the Commission itself decided that, of the nine, the "military value of a base should be the preeminent factor." Id. at 405-06. After the Commission had submitted its recommendations to the Secretary, the Congress passed the Base Closure Act directing the Secretary to implement them. See id. at 403.

The court held that the Secretary's decisions regarding base closures and realignments were "committed to agency discretion by law" and hence not subject to review under the APA. See id. at 405. Although the Base Closure Act incorporated the nine specific criteria that had...