Gill v. U.S. Dep't of Justice

• Decision Date: 29 January 2019
• Docket Number: No. 17-16107,17-16107
• Citation: 913 F.3d 1179
• Parties: Wiley GILL; James Prigoff; Tariq Razak; Khaled Ibrahim ; Aaron Conklin, Plaintiffs-Appellants, v. UNITED STATES DEPARTMENT OF JUSTICE; Matthew Whitaker, Acting Attorney General; Program Manager - Information Sharing Environment; The Office of the Program Manager of the Information Sharing Environment, Defendants-Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

913 F.3d 1179

Wiley GILL; James Prigoff; Tariq Razak; Khaled Ibrahim ; Aaron Conklin, Plaintiffs-Appellants,
v.
UNITED STATES DEPARTMENT OF JUSTICE; Matthew Whitaker, Acting Attorney General; Program Manager - Information Sharing Environment; The Office of the Program Manager of the Information Sharing Environment, Defendants-Appellees.

No. 17-16107

United States Court of Appeals, Ninth Circuit.

Argued and Submitted October 18, 2018 San Francisco, California
Filed January 29, 2019

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Linda Lye (argued) and Julia Harumi, American Civil Liberties Union Foundation of Northern California Inc., San Francisco, California; Michael James Ableson and Stephen Scotch-Marmo, Morgan, Lewis & Bockius LLP, New York, New York; Christina Sinha, Asian Americans Advancing Justice—Asian Law Caucus, San Francisco, California; Hugh Handeyside, American Civil Liberties Union Foundation, New York, New York; Mitra Ebadolahi, American Civil Liberties Union Foundation of San Diego and Imperial Counties, San Diego, California; Jeffrey S. Raskin, Morgan Lewis & Bockius LLP, San Francisco, California; Peter Bibring, American Civil Liberties Union Foundation of Southern California, Los Angeles, California; for Plaintiffs-Appellants.

Daniel Aguilar (argued) and H. Thomas Byron III, Appellate Staff; Alex G. Tse, Acting United States Attorney; Civil Division, United States Department of Justice, Washington, D.C.; for Defendants-Appellees.

Before: MILAN D. SMITH, JR. and ANDREW D. HURWITZ, Circuit Judges, and RICHARD K. EATON,^* Judge.

M. SMITH, Circuit Judge:

In the wake of 9/11, law enforcement agencies at the federal, state, and local levels found that they were unable to communicate effectively about potential threats to our national security. In response, the federal government sought to standardize the sharing of terrorism-related information through the adoption of a "Functional Standard." Aaron Conklin, Wiley Gill, Khaled Ibrahim, James Prigoff, and Tariq Razak (collectively, Plaintiffs) challenged the Functional Standard under the Administrative Procedure Act (APA).¹ The district court granted summary judgment in favor of the federal defendants.

We affirm. Although the Functional Standard constitutes final agency action, it was not required to undergo the APA notice and comment procedure, nor was it arbitrary and capricious.

FACTUAL AND PROCEDURAL BACKGROUND

I. Factual Background

In October 2007, President George W. Bush issued a National Strategy for Information Sharing concerning terrorism-related information. The Strategy created fusion centers that would ensure Suspicious Activity Reports (SARs) were "disseminated to and evaluated by appropriate government authorities," and identify requirements to support a "unified process for reporting, tracking, and accessing" SARs. The nationwide effort to standardize this information sharing was called the Nationwide Suspicious Activity Reporting Initiative (NSI).

To "govern[ ] how terrorism information is acquired, accessed, shared, and used," the Program Manager for the Information Sharing Environment (ISE) has issued three Functional Standards since the inception

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of the NSI, each superseding the previous one: Functional Standard 1.0 (issued January 2008), Functional Standard 1.5 (issued May 2009), and Functional Standard 1.5.5 (issued February 2015).² The current Functional Standard 1.5.5 focuses "exclusively on terrorism-related information."

The Functional Standard defines suspicious activity as "[o]bserved behavior reasonably indicative of pre-operational planning associated with terrorism or other criminal activity." After receiving a report of suspicious activity, an officer creates a SAR. The SAR then undergoes a two-part evaluation process. An analyst determines whether the SAR meets certain behavioral criteria and has a potential nexus to terrorism.³ If the analyst concludes that it does, the SAR becomes an ISE-SAR, and is uploaded to the eGuardian repository, where it is available to all NSI participants. The ISE-SAR is also input into the Federal Bureau of Investigation (FBI) classified system and sent to the Department of Homeland Security Office of Intelligence Analysis.

Plaintiffs are United States citizens who are the subjects of a SAR or ISE-SAR, none of whom has been charged with a crime. The ISE-SAR on Gill notes his potential access to a "flight simulator type of game," his conversion to Islam, and his "pious demeanor." The FBI visited Gill’s sister and questioned her about Gill’s religious beliefs. Another SAR describes Razak as a male of believed Middle Eastern descent who "meticulously stud[ied] the entry/exit points" of a train station. After the SAR was uploaded to eGuardian, the FBI questioned Razak. The SAR concerning Ibrahim notes his attempt to purchase "a large amount of computers." Two reports concerning Ibrahim were uploaded to eGuardian.

Private guards prevented Prigoff, a professional photographer, from taking photographs of a work of public art near Boston, an incident resulting in the creation of multiple SARs. The FBI then visited Prigoff’s home and questioned a neighbor about him. In northern California, private security stopped Conklin, an amateur photographer, from photographing oil refineries, and during the subsequent questioning, the sheriff’s deputies told him he would be placed on an "NSA watch list."

II. Procedural Background

In 2014, Plaintiffs sued the Attorney General, the Department of Justice, and the ISE Program Manager (collectively, the Department). The complaint asserted two APA challenges to the Functional

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Standard, contending that: (1) the promulgation of the Functional Standard without notice and comment was unlawful; and (2) the Standard was arbitrary and capricious because it did not comply with the "reasonable suspicion" standard in 28 C.F.R. Part 23 for the dissemination of criminal intelligence information.⁴

The Department moved to dismiss, arguing that Plaintiffs lacked standing, and that the Functional Standard did not constitute final agency action pursuant to the APA. The district court denied the Department’s motion.

The parties later cross-moved for summary judgment. The district court granted summary judgment for the Department, finding that: (1) the Functional Standard is a policy guidance statement exempt from the notice and comment requirement; and (2) the Functional Standard is not arbitrary and capricious because it addresses data issues outside the scope of 28 C.F.R. Part 23. Plaintiffs timely appealed.

JURISDICTION AND STANDARD OF REVIEW

We have jurisdiction pursuant to 28 U.S.C. § 1291. We review de novo a district court’s grant of summary judgment, and we may affirm on any ground supported by the record. White v. City of Sparks , 500 F.3d 953, 955 (9th Cir. 2007).

ANALYSIS

I. Final Agency Action

The APA allows judicial review only of final agency actions. 5 U.S.C. § 704 ; see Ukiah Valley Med. Ctr. v. FTC , 911 F.2d 261, 266 (9th Cir. 1990). Although it denied the Department’s motion to dismiss for lack of finality, the district court observed in its summary judgment order that there was "good reason to treat the Functional Standard as not constituting a final agency action." We review de novo whether agency action is final. Havasupai Tribe v. Provencio , 906 F.3d 1155, 1161–62 (9th Cir. 2018).

For agency action to be final, it must "mark the consummation of the agency’s decisionmaking process" and "must be one by which rights or obligations have been determined, or from which legal consequences will flow." Bennett v. Spear , 520 U.S. 154, 177–78, 117 S.Ct. 1154, 137 L.Ed.2d 281 (1997) (internal quotation marks omitted). "We focus on the practical and legal effects of the agency action" and interpret finality in a "pragmatic and flexible manner." Or. Nat. Desert Ass’n v. U.S. Forest Serv. , 465 F.3d 977, 982 (9th Cir. 2006) ; see also Indus. Customers of Nw. Utils. v. Bonneville Power Admin. , 408 F.3d 638, 646 (9th Cir. 2005) (considering any "direct and immediate effect on the day-to-day operations of the party seeking review," and if "immediate compliance with the [action’s] terms is expected"). Regardless of an agency’s characterization, we consider the actual effects of the action to determine whether it is final. Columbia Riverkeeper v. U.S. Coast Guard , 761 F.3d 1084, 1094–95 (9th Cir. 2014).

The Department does not dispute that the first finality requirement—consummation of the decisionmaking process—is met. Instead, it concentrates on the second Bennett prong, contending the Functional Standard "merely provides procedural guidelines for [agencies’] voluntary participation" and does not impose binding obligations. Plaintiffs counter that the Functional Standard has legal force because the Department can revoke an agency’s

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eGuardian membership for violating the terms of the eGuardian User Agreement, which requires compliance...