Mickelsen Farms, LLC v. Animal & Plant Health Inspection Servs.

• Decision Date: 20 March 2018
• Docket Number: Case No. 1:15-cv-00143-EJL-CWD
• Parties: MICKELSEN FARMS, LLC, et al., Plaintiffs, v. ANIMAL AND PLANT HEALTH INSPECTION SERVICES, et al., Defendants.
• Court: U.S. District Court — District of Idaho

MICKELSEN FARMS, LLC, et al., Plaintiffs, v. ANIMAL AND PLANT HEALTH INSPECTION SERVICES, et al., Defendants.

Case No. 1:15-cv-00143-EJL-CWD

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF IDAHO

March 20, 2018

MEMORANDUM DECISION AND ORDER

Before the Court in the above entitled matter are cross Motions for Summary Judgment filed by the parties in this action. (Dkt. 75, 84.) The Motions have been fully briefed and are ripe for the Court's consideration. Having reviewed the record herein, the Court finds the facts and legal arguments are adequately presented in the briefs and record. Accordingly, in the interest of avoiding further delay, and because the Court conclusively finds that the decisional process would not be significantly aided by oral argument, the Motions shall be decided on the record before this Court without oral argument.

FACTUAL AND PROCEDURAL BACKGROUND

Plaintiffs are a number of entities and individuals who farm potatoes in southeastern Idaho. In April of 2006, Pale Cyst Nematode (PCN), Globodera Pallida,¹ was detected in the soil of a number of fields that raised potato crops in eastern Idaho. As a result, the Animal and Plant Health Inspection Services (APHIS)² published an Interim Rule and later adopted a Final Rule which provided regulations for the designation and quarantining of fields in Idaho as well as Deregulation Protocols. The Idaho State Department of Agriculture (ISDA) adopted rules and procedures that parallel APHIS's and assisted APHIS in implementing its Interim and Final Rules.

The Plaintiffs filed this action against the federal and state Defendants challenging the issuance and implementation of the Interim Rule and Final Rule. (Dkt. 1.)³ Specifically, Plaintiffs claim the federal Defendants violated the Administrative Procedure Act (APA), 5 U.S.C. §§ 553, 701-706; the Plant Protection Act (PPA), 7 U.S.C. §§ 7701 and 7786; the Federal Advisory Committee Act (FACA), 5 U.S.C. App. II, §§ 1-16; the National Environmental Policy Act (NEPA), 42 U.S.C. §§ 4321-70; and the Tenth Amendment of the United States Constitution. As to the state Defendants, the Plaintiffs claimed the ISDA failed to comply with its legal obligations under the Idaho Plant Pest Act(Idaho PPA), Idaho Code §§ 22-2001 to 22-2023; the Idaho Administrative Procedures Act (Idaho APA), Idaho Code §§ 67-5101 to 67-5292; and Idaho's Rules Governing the PCN (Idaho PCN Rules), IDAPA 02.06.10. In general, Plaintiffs claim the state and federal Defendants' actions were arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.

The Court previously granted the state Defendants' Motion to Dismiss. (Dkt. 35.) The Parties have also filed a Stipulation for Voluntary Dismissal of the action as brought by Plaintiffs Gerald and Helen Kelley, Craig V. and Andrea Kelly, Dan G. and Karen K. Eldredge, and Bohemian, LLC. (Dkt. 47.) The Plaintiffs and federal Defendants have now filed their cross Motions for Summary Judgment as to the remaining claims which the Court takes up herein. (Dkt. 75, 84.)

STANDARD OF LAW

Motions for summary judgment are governed by Rule 56 of the Federal Rules of Civil Procedure which provides, in pertinent part, that judgment "shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(c). Under Rule 56, summary judgment is mandated if the non-moving party fails to make a showing sufficient to establish the existence of an element which is essential to the non-moving party's case and upon which the non-moving party will bear the burden of proof at trial. See Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). If the non-movingparty fails to make such a showing, "there can be no 'genuine issue of material fact,' since a complete[] failure of proof concerning an essential element of the nonmoving party's case necessarily renders all other facts immaterial." Id. at 323.

In order to withstand a motion for summary judgment, a party

(1) must make a showing sufficient to establish a genuine issue of fact with respect to any element for which it bears the burden of proof; (2) must show that there is an issue that may reasonably be resolved in favor of either party; and (3) must come forward with more persuasive evidence than would otherwise be necessary when the factual context makes the non-moving party's claim implausible.

British Motor Car Distrib. v. San Francisco Auto. Indus. Welfare Fund, 883 F.2d 371, 374 (9th Cir. 1989) (citation omitted). When applying this standard, the court views all of the evidence in the light most favorable to the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986); Hughes v. United States, 953 F.2d 531, 541 (9th Cir. 1992).

STATUTORY FRAMEWORK

The Plant Protection Act (PPA) authorizes the Secretary of the United States Department of Agriculture (USDA) to adopt and/or issue regulations "to prevent the introduction of plant pests into the United States or the dissemination of plant pests within the United States." 7 U.S.C. §§ 7711(a), 7712(c). The Secretary delegated that authority to APHIS, making APHIS responsible for the regulation and containment of PCN. 7 C.F.R. § 2.22(a). Under that authority, APHIS issued the Interim and Final Rules which quarantined certain infested fields and associated fields in Idaho where PCN was found, restricts the interstate movement of regulated articles from those quarantined areas, and provides Deregulation Protocols for quarantined fields. See 7 C.F.R. § 301.86; (RM 1,438.) The claims against the federal Defendants in this case allege violations of the APA, PPA, FACA, NEPA, and the Tenth Amendment relating to their actions taken under the PPA.

DISCUSSION

1. Violation of the APA's Rulemaking Requirements

Plaintiffs argue APHIS violated the APA's rulemaking requirements with regard to the Deregulation Protocols, 7 C.F.R. §§ 301.86-3(d)(1) & (2), because APHIS never issued the protocol contemplated in the Final Rule to deregulate infested fields and the multiple iterations of the protocols for deregulating associated fields were never subject to public notice or comment. (Dkt. 75 at 12-14) (Dkt. 87 at 6-7.)⁴ Defendants counter arguing the Deregulation Protocols were not subject to the rulemaking requirements and, therefore, did not violate the APA. (Dkt. 84 at 14) (Dkt. 89 at 5.)

The APA establishes the notice and comment procedures federal administrativeagencies must use when engaged in "rulemaking," which is defined as the process of "formulating, amending, or repealing a rule." Perez v. Mortgage Bankers Ass'n, 135 S.Ct. 1199, 1203-04 (2015); see also Hemp Industries Ass'n v. Drug Enforcement Admin., 333 F.3d 1082, 1087-88 (9th Cir. 2003); 5 U.S.C. §§ 551(5), 553. Those procedures generally require agencies to: (1) publish a notice of the proposed rule in the Federal Register; (2) provide a period for interested persons to comment on the proposed rule, which will be considered by the agency prior to adopting the rule; and (3) publication of the final rule in the Federal Register. 5 U.S.C. § 553; see also Mora-Meraz v. Thomas, 601 F.3d 933, 939 (9th Cir. 2010).

There are two types of rules under the APA: legislative rules and interpretive rules. Perez, 135 S.Ct. at 1203. The rulemaking procedures only apply to legislative rules, not interpretative rules. If a rule is "legislative," the agency must use the notice and comment procedure unless "it publishes a specific finding of good cause documenting why such procedures 'are impracticable, unnecessary, or contrary to the public interest.'" Hemp Indus., 333 F.3d at 1087 (quoting 5 U.S.C. § 553(b)(B)). On the other hand, "interpretive rules, general statements of policy, or rules of agency organization, procedure or practice" are exempt from the rulemaking procedures. 5 U.S.C. § 553(b)(3)(A); Mora-Meraz, 601 F.3d at 939.⁵ The exceptions to the notice and comment requirements are "narrowlyconstrued and only reluctantly countenanced." Alcaraz v. Block, 746 F.2d 593, 612 (9th Cir. 1984). Failure to implement the notice and comment procedure when required, invalidates the resulting regulation. See Paulsen v. Daniels, 413 F.3d 999, 1008 (9th Cir. 2005).

Plaintiffs assert the Deregulation Protocols are legislative rules subject to the APA's rulemaking procedural requirements. (Dkt. 87 at 6-7.) Defendants argue the protocols are not legislative rules but, instead, general policy statements and, therefore, excluded from the APA's rulemaking procedures (Dkt. 89 at 5.)⁶

A. Legislative Rules

Legislative rules "create rights, impose obligations, or effect a change in existing law pursuant to authority delegated by Congress." Hemp Indus., 333 F.3d at 1087 (internal citation omitted). Legislative rules trigger the notice and comment process because they have the "force and effect of law." Perez, 135 S.Ct. at 1203 (citing Chrysler Corp. v. Brown, 441 U.S. 281, 302-303 (1979)); see also Erringer v. Thompson, 371 F.3d 625, 630 (9th Cir. 2004). A rule has the force and effect of law:

(1) when, in the absence of the rule, there would not be an adequate legislative basis for enforcement action;

(2) when the agency has explicitly invoked its general legislative authority; or

(3) when the rule effectively amends a prior legislative rule.

Hemp Indus., 333 F.3d at 1087(internal quotation marks and citation omitted). "If the answer to any of these questions is affirmative," the rule is legislative, not interpretive. Oregon v. Ashcroft, 368 F.3d 1118, 1133 (9th Cir. 2004) (internal quotation marks and citation omitted), aff'd sub nom. Gonzales v. Oregon, 546 U.S. 243 (2006).

Interpretive rules, on the other hand, "merely explain, but do not add to, the substantive law that already exists in the form of a statute or legislative rule." Hemp Indus., ...