Foss v. National Marine Fisheries Service

• Decision Date: 25 November 1998
• Docket Number: No. 97-36097,97-36097
• Parties: 29 Envtl. L. Rep. 20,330, 98 Cal. Daily Op. Serv. 8660, 98 Daily Journal D.A.R. 12,037 Richard D. FOSS, Plaintiff-Appellant, v. NATIONAL MARINE FISHERIES SERVICE; Steven Pennoyer, in his capacity as Regional Director, National Marine Fisheries Service; Michael Kantor, in his capacity as Secretary of Commerce; Department of Commerce, Defendants-Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 584

161 F.3d 584

29 Envtl. L. Rep. 20,330, 98 Cal. Daily Op.

Serv. 8660,

98 Daily Journal D.A.R. 12,037

Richard D. FOSS, Plaintiff-Appellant, v. NATIONAL MARINE FISHERIES SERVICE; Steven Pennoyer, in his capacity as Regional Director, National Marine Fisheries Service; Michael Kantor, in his capacity as Secretary of Commerce; Department of Commerce, Defendants-Appellees.

No. 97-36097.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted Sept. 15, 1998.

Decided Nov. 25, 1998.

Wayne Mitchell, Harris & Hull, Seattle, Washington, for the plaintiff-appellant.

M. Alice Thurston, Andrew C. Mergen, United States Department of Justice, Washington D.C. and Brian C. Kipnis, Office of the United States Attorney, Seattle, Washington, for the defendants-appellees.

Appeal from the United States District Court for the Western District of Washington Thomas S. Zilly, District Judge, Presiding. D.C. No. CV-96-01583-TSZ.

Before: SCHROEDER, WIGGINS and McKEOWN, Circuit Judges.

McKEOWN, Circuit Judge:

This case calls upon us to decide whether an applicant for a federal fishing quota permit has a cognizable procedural due process claim. Appellant Richard Foss filed his application 45 days late and the National Marine Fisheries Service ("NMFS") denied the application as untimely. Foss claims that the denial violated his procedural due process rights and also challenges the denial on other grounds. The district court held that Foss had no property or liberty interest in the permit and hence did not have a due process claim, rejected his other claims, and granted summary judgment against him. We disagree with the district court's analysis of the due process issue. The fishing quota permit was a regulatory entitlement, not an abstract gleam in Foss's eye or a unilateral expectation. NMFS had no discretion to deny Foss's application, assuming he met the objective regulatory requirements. Under long-standing Ninth Circuit authority, we hold that for purposes of procedural due process, Foss had a protectible property interest in receiving a guaranteed fishing quota permit. Nonetheless, NMFS's procedures were "constitutionally sufficient" and NMFS properly denied Foss's application. Mathews v. Eldridge, 424 U.S. 319, 334, 96 S.Ct. 893, 47 L.Ed.2d 18 (1976). We affirm the district court's summary judgment in favor of NMFS.

BACKGROUND

The Individual Fishing Quota ("IFQ") Program

Management of fishery resources presents difficult and competing choices. In an effort "to promote the conservation and management of halibut and sablefish resources," in 1993 the Secretary of Commerce adopted regulations to limit access to sablefish and halibut fisheries in the waters off of Alaska. ¹ 57 Fed.Reg. 57,130 (1992); 58 Fed.Reg. 59,375 (1993); see also 50 C.F.R. Part 679. ² This program, known as the Individual Fishing Quota ("IFQ") program, addressed problems, including overfishing, stemming from an historical regulatory regime that allowed unlimited entry to the fisheries. Limited-access programs, a dramatic change from the open-access approach, were discussed and analyzed for years prior to final implementation of the IFQ plan. The new program was an effort to conserve fishery resources while creating a stable market for transferable fishing rights. Before adopting the program, NMFS undertook extensive economic and environmental studies, reviewed alternative conservation options, published proposed rules and solicited public comment. See 57 Fed.Reg. 57,130-57,154 (1992); 58 Fed.Reg. 59,375-59,401 (1993). An excellent discussion of the program is found in Alliance Against IFQs v. Brown, 84 F.3d 343 (9th Cir.1996).

The IFQ program works as follows: NMFS initially divided the allowable catch of halibut and sablefish among holders of quota shares ("QS"). Eligibility for QS depended solely on the applicant's ³ total landings of halibut or sablefish during specified years. 50 C.F.R. § 679.40(a). An applicant who previously fished for (made "legal landings of") halibut or sablefish during qualifying years was automatically entitled to some amount of QS, calculated according to a regulatory formula. Id. The QS allocation then served as the basis for issuance of an IFQ permit. 50 C.F.R. § 679.40(b), (c). Allocation of initial QS was a one-time event. Subsequent IFQ permits are issued annually based on calculations stemming from the initial QS allocation. 50 C.F.R. § 679.40(b). Commercial fishing for halibut and sablefish in the regulated waters is limited to IFQ permit holders: no permit, no legal fishing. Id.; see also Alliance Against IFQs, 84 F.3d at 345. Because the IFQ permit and the QS on which the permit is based are functionally equivalent for purposes of this appeal, we refer to them collectively as "the IFQ permit."

The regulations are mandatory and NMFS has no discretion to reject applicants who meet the well-delineated statutory criteria for an IFQ permit. The only criteria for qualification are objective: The Regional Administrator of NMFS is required to grant an IFQ permit to any qualified person who made legal landings of halibut or sablefish during the qualifying years. See 50 C.F.R. § 679.40(a)(1) ("The Regional Administrator shall initially assign to qualified persons" an allocation of QS) (emphasis added); see also 50 C.F.R. § 679.40(b) ("The Regional Administrator shall assign halibut or sablefish IFQs to each person holding unrestricted QS for halibut or sablefish ....") (emphasis added); 50 C.F.R. § 679.40(a)(8) ("Uncontested data in applications will be approved by the Regional Administrator. Based on these data, the Regional Administrator will calculate each applicant's initial halibut and sablefish QS ....") (emphasis added); 50 C.F.R. § 679.40(c) ("The annual allocation of IFQ to any person ... will be equal to" a fixed calculation).

The final regulations required applications to be submitted to NMFS between January 17, 1994 and July 15, 1994. 59 Fed.Reg. 701, 702 (1994). NMFS went to great lengths to ensure that potential applicants were aware of this new and controversial program. In addition to formal notice in the Federal Register, NMFS sent applications to the thousands of fishermen in its database, sometimes (as in Foss's case) resending applications that were returned undelivered. NMFS also publicized the application period in industry magazines, news releases, paid advertisements, public service announcements and information workshops in Alaska and Washington.

Appellant Foss

Foss, a long time commercial fisherman, had been aware since the early 1980s of the movement to establish a limited access program. In 1988, Foss quit fishing for halibut and sablefish off of Alaska, and shifted his focus to tuna fishing in the South Pacific. He returned to the United States for brief periods in the summer and fall of 1989 and the summer of 1990 and then returned to tuna fishing in Fiji and off of the South American coast. In December 1992, he contacted the International Pacific Halibut Commission ("IPHC") ⁴ to ask about the status of halibut regulation. The IPHC employee told him that an IFQ program had been proposed, but that nothing was imminent. In fact, NMFS published the proposed rules for the IFQ program on December 3, 1992. 57 Fed.Reg. at 57,130. The final rules were published on November 9, 1993, and the rule specifying the application period was published on January 6, 1994. 58 Fed.Reg. at 59,375; 59 Fed.Reg. at 701.

Foss claims he did not hear anything about the proposed program or the deadlines during this time frame because he was tuna fishing in the North and South Pacific. As part of its effort to provide individual notice to all potential applicants, NMFS sent two applications to Foss at the most recent address listed in its records, the residence where Foss previously lived with his then wife. Foss did not receive the applications, nor did he see the Federal Register regulations or the advertisements and announcements circulated by NMFS in various Washington and Alaska media. Although he was on land from April 1992 to November 1993 and between late April and late May 1994, Foss did not again contact the IPHC until August 2, 1994, approximately two weeks after the July 15, 1994 deadline. NMFS received Foss's application on August 30, 1994 (45 days after the deadline) and rejected it as untimely.

ANALYSIS

I. Procedural Due Process Claim

Foss argues that he was denied procedural due process because NMFS deprived him of entitlement to an IFQ permit without actual notice. We disagree. Foss's procedural due process claim hinges on proof of two elements: (1) a protectible liberty or property interest in obtaining the permit; and (2) a denial of adequate procedural protections. See Board of Regents v. Roth, 408 U.S. 564, 569-71, 92 S.Ct. 2701, 33 L.Ed.2d 548 (1972); see also Mathews v. Eldridge, 424 U.S. 319, 335, 96 S.Ct. 893, 47 L.Ed.2d 18 (1976). Although Foss is correct that he has a protectible property interest in receiving the IFQ permit, his claim fails because he received all the process that was due him. Actual notice is not required.

A. Property Interest

The threshold question is whether Foss has a constitutionally protectible property interest in acquiring an IFQ permit, i.e., "a legitimate claim of entitlement" as opposed to a "unilateral expectation" or an "abstract need or desire for it." Roth, 408 U.S. at 577, 92 S.Ct. 2701 (1972). There can be no doubt that the IFQ permit is property. It is subject to sale, transfer, lease, inheritance, and division as marital property in a dissolution. See 50 C.F.R. § 679.41; Johns v. Johns, 945 P.2d 1222, 1225-26 (Alaska 1997); Ferguson v. Ferguson, 928 P.2d 597, 599-600 (Alaska 1996). The property right in obtaining this specific permit is, of course, distinguishable from a claim of owning the fish themselves, which the Supreme Court has termed "pure fantasy." Douglas v. Seacoast Products, Inc., 431 U.S. 265, 284, 97 S.Ct. 1740, 52...