US Citrus Sci. Council v. U.S. Dep't of Agric.

• Decision Date: 27 February 2018
• Docket Number: Case No. 1:17–cv–00680–LJO–SAB
• Citation: 312 F.Supp.3d 884
• Parties: US CITRUS SCIENCE COUNCIL; Santa Paula Creek Ranch ; CPR Farms ; Green Leaf Farms, Inc.; Bravante Produce; and Richard Bagdasarian, Inc., Plaintiffs, v. The UNITED STATES DEPARTMENT OF AGRICULTURE; Sonny Perdue, Secretary of Agriculture; and Kevin Shea, Administrator, Animal and Plant Health Inspection Service, Defendants.
• Court: U.S. District Court — Eastern District of California

312 F.Supp.3d 884

US CITRUS SCIENCE COUNCIL; Santa Paula Creek Ranch ; CPR Farms ; Green Leaf Farms, Inc.; Bravante Produce; and Richard Bagdasarian, Inc., Plaintiffs,

v.The UNITED STATES DEPARTMENT OF AGRICULTURE; Sonny Perdue, Secretary of Agriculture; and Kevin Shea, Administrator, Animal and Plant Health Inspection Service, Defendants.

Case No. 1:17–cv–00680–LJO–SAB

United States District Court, E.D. California.

Signed February 27, 2018

Ari Holtzblatt, Pro Hac Vice, David W. Ogden, Pro Hac Vice, Kelly P. Dunbar, Pro Hac Vice, Robert Manhas, Pro Hac Vice, Wilmer Cutler Pickering Hale and Dorr LLP, Washington, DC, Christopher Casamassima, Los Angeles, CA, for Plaintiffs.

Daniel Schwei, U.S. Dep't of Justice, Civil Division, Federal Programs Branch, John Tustin, U.S. Department of Justice Environment and Natural Resources Division Natural Resources Section, Washington, DC 20044 for Defendants.

MEMORANDUM DECISION AND ORDER DENYING PLAINTIFFS' MOTION FOR SUMMARY JUDGMENT, AND GRANTING DEFENDANTS' CROSS–MOTION FOR SUMMARY JUDGMENT

ECF Nos. 35, 37

Lawrence J. O'Neill, UNITED STATES CHIEF DISTRICT JUDGE

I. INTRODUCTION

Plaintiffs US Citrus Science Council, Santa Paula Creek Ranch, CPR Farms, Green Leaf Farms, Inc., Bravante Produce, and Richard Bagdasarian, Inc. (collectively, "Plaintiffs") bring this action against Defendants United States Department of Agriculture ("USDA"), Sonny Perdue, Secretary of Agriculture, and Kevin Shea, Administrator, Animal and Plant Health Inspection Service ("APHIS") (collectively, "Defendants" or the "Government"), to challenge a rule lifting the ban on lemons imported from Argentina (the "Rule" or "Final Rule"). Both parties move for summary judgment. This matter is suitable for disposition without oral argument. See Local Rule 230(g). For the reasons set forth below, Plaintiffs' motion for summary judgment is DENIED, and Defendants' cross-motion for summary judgment is GRANTED.

II. BACKGROUND

A. Statutory Framework

1. Plant Protection Act

The Plant Protection Act ("PPA") authorizes the Secretary of the USDA to 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). The Secretary delegated that authority to the Animal and Plant Health Inspection Service ("APHIS"), an agency within USDA. 7 C.F.R. §§ 2.22(a), 280(a)(36). Pursuant to the PPA, APHIS has issued a number of regulations regarding the conditions under which fruits and vegetables can be imported into the United States.

2. Regulatory Flexibility Act

The Regulatory Flexibility Act ("RFA") requires that agencies issuing rules under the Administrative Procedure Act ("APA") publish a final regulatory flexibility analysis assessing the negative impact of the rule on small businesses. 5 U.S.C. §§ 603, 604. However, the agency does not need to engage in flexibility analysis if the agency head certifies that the rule will not have a significant economic impact on a substantial number of small entities. 5 U.S.C. § 605(b).

Such an analysis must meet certain statutory requirements. It must state the purpose of the relevant rule and the estimated number of small businesses that the rule will affect, if such an estimate is available. In addition, each analysis must summarize comments filed in response to the agency's initial regulatory flexibility analysis, along with the agency's assessment of those comments. Finally, each analysis must include "a description of the steps the agency has taken to minimize the significant economic impact" that its rule will have on small businesses, "including a statement of the factual, policy, and legal reasons for selecting the alternative adopted in the final rule and why each one of the other significant alternatives to the rule considered by the agency which affect the impact on small entities was rejected." § 604(a)(5).

B. Regulatory History

Since 1947, regulations under the PPA and its predecessor statutes have barred the importation of lemons and other citrus from Argentina. See 7 C.F.R. § 319.28(a)(1)–(3) (2015). In 2000, APHIS promulgated a rule lifting the ban on importing lemons from Argentina, but the regulation was vacated in 2001 because this Court concluded that APHIS relied on faulty assumptions in completing its pest risk assessment. See Harlan Land Co. v. U.S. Dep't of Ag. , 186 F.Supp.2d 1076 (E.D. Cal. 2001).

In May 2016, APHIS proposed a new regulation permitting the importation of lemons from northwest Argentina. Importation of Lemons from Northwest Argentina , 81 Fed. Reg. 28,758 (May 10, 2016) ("Proposed Rule"). The Proposed Rule acknowledged the presence of certain pests affecting citrus crops in Argentina, but posited that the risk of pests could be effectively mitigated by the use of a "systems approach." Id. The "systems approach" outlined procedures intended to ensure the safety of imported lemons, including the responsibilities of the Argentine government's inspection agency ("SENASA"), preventative measures required by Argentine growers, mitigation measures required by Argentine lemon packinghouses, and APHIS's role in overseeing and inspecting imported lemons. Id. at 28,759–28,761.

The Proposed Rule was accompanied by an initial regulatory flexibility analysis. Id. at 28,762 –28763. The analysis estimated that between 15,000 and 20,000 metric tons of fresh lemons would be imported from Argentina annually, causing the price of fresh lemons to drop between 2% and 4%. Id. at 28,762. It predicted a corresponding loss to California and Arizona lemon growers between $10.9 and $22 million each year. Id. at 28,762. The analysis concluded that the "[e]conomic effects of the rule for both producers and consumers are not expected to be significant." Id.

After a period of notice and comment, APHIS published its Final Rule governing the importation of Argentine Lemons. Importation of Lemons From Northwest Argentina , 81 Fed. Reg. 94,217 (Dec. 23, 2016) (codified at 7 C.F.R. § 319.56–76 ) ("Final Rule"). In the Final Rule, APHIS concluded that it would allow the importation of fresh lemons from northwest Argentina, subject to conditions and requirements articulated in the Final Rule. Id. The Final Rule was scheduled to go into effect on January 23, 2017, but was postponed until May 26, 2017. See Importation of Lemons From Northwest Argentina: Stay of Regulations , 82 Fed. Reg. 8353 (Jan. 25, 2017) ; Importation of Lemons From Northwest Argentina: Stay of Regulations , 82 Fed. Reg. 14,987 (Mar. 24, 2017). On May 1, 2017, USDA issued a Stakeholder Announcement indicating that the previously issued Final Rule would go into effect on May 26, 2017, and announcing that "[f]or 2017 and 2018, Argentine lemons would be imported only into the northeastern United States." See USDA, APHIS Will Not Extend Stay on Import Regulations for Lemons from Northwest Argentina (May 1, 2017), available at https://www.aphis.usda.gov/aphis/newsroom/stakeholder-info/sa_by_date/sa-2017/sa-05/argentina-lemons. On August 17, 2017, representatives from APHIS, SENASA, and the Argentine lemon industry signed the final operational workplan, which set forth additional details and procedures for implementing the day-to-day operations of the Rule. See Administrative Record ("AR") 28340.¹ The Rule is now effective, see 7 C.F.R. § 319.56–76, although Plaintiffs indicate that imports will begin "in full" in March 2018, ECF No. 40 at 1–2.

C. Procedural Background

Plaintiffs filed the instant lawsuit on May 17, 2017, challenging the Final Rule and the Amendment promulgated by APHIS under the PPA, APA, National Environmental Policy Act ("NEPA"), and RFA. (ECF No. 2.) Plaintiffs brought six counts in the First Amended Complaint: failure to disclose for public comment data, notes, or a trip report for the 2015 harvest season site visit under the PPA and APA (Count I); failure to consider properly SENASA's failed history, and unjustified reliance on SENASA workplan under the PPA and APA (Count II); failure to use notice and comment procedures to amend, and failure to provide reasoned decision-making in amending, the rule to restrict importation to northeastern ports under the PPA and APA (Count III); failure to provide reasoned decision-making under the APA (Count IV); failure to comply with NEPA (Count V); and failure to comply with the RFA (Count VI). Defendants previously moved to dismiss the FAC on the basis that Plaintiffs lacked standing. The Court dismissed Count III, but concluded that Plaintiffs had standing to pursue Counts I, II, IV, V, and VI. ECF No. 36 ("October 25 Order"). Both parties now move for summary judgment on all remaining claims. (ECF Nos. 35, 37.)

This Court has federal question jurisdiction pursuant to 28 U.S.C. §§ 1331, 1361, and 2201 – 2202, as well as the APA, 5 U.S.C. §§ 701 – 706, and the RFA, 5 U.S.C. § 611. Venue is proper in this Court and the matter is ripe for review.

III. STANDARD OF DECISION

A. Summary Judgment

The remedy for challenging an agency's decision not to authorize testimony is a separate action in federal court pursuant to the APA. See In re Boeh , 25 F.3d 761, 764 n.3 (9th Cir. 1994). In an action brought pursuant to the APA, a reviewing court may "hold unlawful and set aside agency action, findings, and conclusions found to be...arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law." 5 U.S.C. § 706(2)(A). "It is well established that once an agency has taken final agency action under the APA, a reviewing court analyzes that decision under the ‘arbitrary and capricious’ standard of review." Mt. St. Helens Mining & Recovery Ltd. P'ship v. United States , 384 F.3d 721, 727 (9th Cir. 2004) (citations omitted).

"Under the arbitrary and capricious standard, a reviewing court must determine whether an agency's decision was based on a consideration of the relevant factors and whether there has been a clear error of judgment." Mt. St. Helens , 384 F.3d at...