Starbuck v. City and County of San Francisco

• Decision Date: 28 June 1977
• Docket Number: No. 75-2213,75-2213
• Citation: 556 F.2d 450
• Parties: Charles STARBUCK et al., Plaintiffs-Appellants, v. CITY AND COUNTY OF SAN FRANCISCO et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 450

556 F.2d 450

Charles STARBUCK et al., Plaintiffs-Appellants, v. CITY AND COUNTY OF SAN FRANCISCO et al., Defendants-Appellees.

No. 75-2213.

United States Court of Appeals, Ninth Circuit.

June 28, 1977.

Richard M. Kaplan (argued), San Francisco, Cal., for plaintiffs-appellants.

Terry J. Houlihan (argued), San Francisco, Cal., Phyllis L. Hubbell (argued), Dept. of Justice, Washington, D. C., for defendants-appellees.

McMorris M. Dow, Deputy City Atty. (argued), for defendant-appellee City and County of San Francisco.

Appeal from the United States District Court for the Northern District of California.

Before HUFSTEDLER and GOODWIN, Circuit Judges, and EAST, ^* District Judge.

HUFSTEDLER, Circuit Judge:

The present appeal gives renewed vitality to the long-time dispute over the delivery of hydroelectric power from the Hetch Hetchy Valley to the Bay Area. Appellants, residents, taxpayers, and consumers of electricity in San Francisco, allege that San Francisco's present "wheeling" arrangement with the Pacific Gas and Electric Company violates Section 6 of the Raker Act of December 19, 1913, ch. 4, 38 Stat. 242, establishing the Hetch Hetchy Valley as a resource of water and electric power. Appellees are the City and County of San Francisco ("San Francisco"), Pacific Gas and Electric Company ("PG&E") and the Secretary of The Interior ("the Secretary"). The district court granted San Francisco's and PG & E's motion to dismiss for failure to state a claim because it concluded that the Raker Act did not create a private cause of action in favor of appellants. It also granted summary judgment in favor of the Secretary with respect to appellants' claims under the Administrative Procedure Act, 5 U.S.C. §§ 701, 702 (1967), and the mandamus statute, 28 U.S.C. § 1361 (1976). The district court determined that these claims were barred by the doctrine of sovereign immunity and were unreviewable decisions within the Secretary's discretion. We affirm the lower court's result, but we disagree with its reasoning.

Appellants' claims arise in the context of a unique statutory framework. The Raker Act opened the doors of the Hetch Hetchy Valley's abundant water and hydroelectric resources to the residents of the Bay Area. Many groups were involved in the drafting of this legislation including the Bay Cities, environmentalists, local water and utility companies, and California farmers and irrigation districts. The culmination of their efforts was a statute that creates a delicate balance between federal interests in the use of federal public lands and state interests in the supply and distribution of water and energy to its citizens. Although appellants' Raker Act allegations raise a potpourri of complex federal jurisdictional issues, ¹ we need not decide them because the Raker Act does not create a private cause of action in favor of appellants.

The Raker Act does not expressly authorize consumers and residents of San Francisco to enforce its provisions. This omission does not foreclose the implication of a private cause of action. The Supreme Court has recently considered the question of the propriety of implying a private cause of action in Nat'l Railroad Passenger Corp. v. Nat'l Ass'n. of Railroad Passengers ("Amtrak") (1974) 414 U.S. 453, 94 S.Ct. 690, 38 L.Ed.2d 646 (suit to enjoin discontinuance of allegedly uneconomic routes under the Rail Passenger Act of 1970), and its progeny. (See, Securities Investor Protection Corp. v. Barbour ("SIPC") (1975) 421 U.S. 412, 95 S.Ct. 1733, 44 L.Ed.2d 263 (suit to compel SIPC to provide financial relief to customers of failing broker-dealer); Cort v. Ash (1975) 422 U.S. 66, 95 S.Ct. 2080, 45 L.Ed.2d 26 (stockholder damages action against corporate directors for making illegal campaign contributions); Blue Chip Stamps v. Manor Drug Stores (1975) 421 U.S. 723, 95 S.Ct. 1917, 44 L.Ed.2d 539 (10b-5 suit for damages brought by nonpurchaser or seller of securities).) The language in these cases, while suited to the statutory schemes therein involved, provides an ill-fitting pattern against which to measure the provisions of the Raker Act. Unlike the administrative schemes involved in those cases, the Raker Act's administration depends on a finely-tuned interplay of the Secretary's discretion ² and a balance of state and federal control over the use of Hetch Hetchy water and power. ³ Cort v. Ash, supra, provides the most appropriate albeit imperfect standard ⁴ to apply to the question of an implied cause of action under the idiosyncratic Raker Act. In Cort v. Ash, the Court stated the following criteria:

". . . First, is the plaintiff 'one of the class for whose especial benefit the statute was enacted,' . . . that is, does the statute create a federal right in favor of the plaintiff? Second, is there any indication of legislative intent, explicit or implicit, either to create such a remedy or to deny one? . . . Third, is it consistent with the underlying purposes of the legislative scheme to imply such a remedy for the plaintiff? . . . And finally, is the cause of action one traditionally relegated to state law, in an area basically the concern of the States, so that it would be inappropriate to infer a cause of action based solely on federal law?" (422 U.S. at 78, 95 S.Ct. at 2088.)

Appellants' basic complaint is that San Francisco's use of PG&E's transmission lines to deliver Hetch Hetchy power to its residents violates Section 6 of the Raker Act. ⁵ They contend that they satisfy the first criterion in Cort v. Ash because they are the direct beneficiaries of the prohibitions of Section 6. More specifically, appellants note that Section 6 was intended to establish the Hetch Hetchy power resource as a competitor of private monopolistic suppliers of electric power to the Bay Area. Given this introduction of competition, electric rates would decrease for Bay Area consumers. Appellants find verbal nourishment for their position from a prior battle in the courts over the Hetch Hetchy grant. In United States v. City and County of San Francisco (1940), 310 U.S. 16, 60 S.Ct. 749, 84 L.Ed. 1050, the Court held that Section 6 requires the "sale and distribution of Hetch Hetchy power exclusively by San Francisco . . . directly to consumers in the belief that consumers would thus be afforded power at cheap rates in competition with private power companies, particularly Pacific Gas & Electric Company." (Id. at 26, 60 S.Ct. at 755.) The case documents Congress' intent in drafting the Raker Act to free San Francisco residents from the "galling bondage to a merciless taskmaster" and the "thralldom . . . (of) a remorseless private monopoly." (50 Cong.Rec. 4110 (1913) (remarks by Rep. Bailey).) (See, 310 U.S. at 22, 60 S.Ct. 749. ("From the congressional debates on the passage of the Raker Act can be read a common understanding both on the part of sponsors of the Bill and its opponents that the grant was to be so conditioned as to require municipal performance of the function of supplying Hetch-Hetchy water and electric power directly to the ultimate consumers, and to prohibit sale or distribution of that power and water by any private corporation or individual." (footnote omitted).); and 51 Cong.Rec. 343-47 (1913) (remarks of Sen. Norris) ⁶.)

The fact that Congress may have included the inhabitants of San Francisco among the beneficiaries of the Act does not imply that Congress intended to create a private cause of action in favor of those inhabitants. The legislative history of the Act reveals a careful consideration of the enforcement mechanism for the many conditions in the Hetch Hetchy grant. The primary concern of the debates was the relationship of the Federal Government vis-a-vis the State of California. That is, how should the Federal Government ensure that California would comply with the conditions to its grant of federal lands? Many congressmen suggested that an automatic forfeiture provision should be included in the grant. (See, 50 Cong.Rec. 4103-04 (1913).) But the suggestion was rejected as too harsh. (See, id. at 4105 ("(F)or heaven's sake, let us not add a clause so that if a horse takes a drink out of a creek or some one uses a little water or does something it may afford an excuse for some superserviceable United States attorney to jump in and declare forfeiture." (remarks by Rep. Taylor).).) The compromise that evolved was an amendment offered by Senator Raker himself which became Section 9(u) of the Act. That section provides that the Attorney General, at the request of the Secretary, may commence suit to enforce the Act if the grantee violates any of the conditions to the grant. ⁷ An eleventh hour amendment offered by Representative Mondell, an opponent of the bill, which would have given "any party in interest" a right to enforce the Act ⁸ was rejected with little debate. (See, 50 Cong.Rec. 3986-88 (1913).) ⁹

Parallel to the legislative development of Section 9(u) was the concern over the protection of the pre-existing rights of certain irrigation districts. (See, 51 Cong.Rec. 297 (1913) (remarks by Sen. Borah); 50 Cong.Rec. 4109-11 (1913).) Section 10 of the Act ¹⁰ was thus included to give those irrigation districts a specific cause of action to enforce their rights. At this juncture, Representative Mondell concluded that the enforcement provisions in the Act ruled out any other private cause of action:

"Now, there are conditions in this bill in which various parties will be interested; individuals, corporations, water districts, municipalities, and everybody in interest ought to have an opportunity to get into court and compel the enforcement of the provisions. The amendment offered by . . . (Mr. Raker) unfortunately would preclude or attempt to preclude them. So far as it has any force to prevent any party in interest from bringing suit unless they could persuade the Secretary of the Interior to bring a suit in their behalf it is wrong." (Id. at 4109.)...