National Mining Association v. Office of Hearings and Appeals ( 2011 )

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6
7 IN THE UNITED STATES DISTRICT COURT FOR THE
DISTRICT OF COLUMBIA
8
NATIONAL MINING ASSOCIATION )
9 )
Plaintiff-Petitioner ) CASE NO. 1:04-cv-00128 BJR
10 )
v. )
11 ) ORDER GRANTING DEFENDANTS’
OFFICE OF HEARINGS AND ) MOTION FOR SUMMARY JUDGMENT
12 APPEALS, et al. ) AND DENYING PLAINTIFF’S MOTION
) FOR SUMMARY JUDGMENT
13 )
Defendants. )
14 ____________________________________
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16 This matter comes before the court on cross motions for summary judgment. Plaintiff is
17 the National Mining Association (“NMA”), the national trade association of the mining industry.
18 Defendants are the Office of Hearings and Appeals (“OHA”), the U.S. Department of the Interior
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(the “Department”), and Kenneth Salazar, Secretary of the Department. OHA is a sub-agency of
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the Department and has as its purpose hearing and determining matters within the Department’s
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jurisdiction. The Department’s jurisdiction includes matters arising under the Surface Mining
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Control and Reclamation Act of 1977, 30 U.S.C. §101 et seq. (“SMCRA”).
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24 On January 27, 2004, Plaintiff filed a complaint seeking judicial review of the November
25 28, 2003 “Final Rule” (68 Fed. Reg. 66723) published by OHA pertaining to regulations
allocating the burden of proof in five types of administrative proceedings under the SMCRA.
ORDER-1
NMA seeks declaratory and injunctive relief. NMA filed a Motion for Summary Judgment.
1
Defendants filed an opposition and a Cross Motion for Summary Judgment. While the motions
2
3 for summary judgment were pending, OHA filed a Notice of Supplemental Authority, to which
4 NMA responded. The action was reassigned on November 30, 2010, and is ripe for review. The
5 parties and the court are in agreement that this matter must be resolved with reference to the
6
briefing and the administrative record.
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I. BACKGROUND
8
A. Applicable Statutes and Regulations
9
10 1. Administrative Procedure Act (“APA”)
11 The APA, 5 U.S.C. §551 et seq., with some exceptions applies to all adjudications that
12 are required by statute to be determined on the record after an opportunity for an agency-level
13 hearing. 5 U.S.C. §554. Section 556 provides that in such hearings, unless “otherwise provided
14
by statute, the proponent of a rule or order has the burden of proof.” 5 U.S.C. §556(d).
15
2. Surface Mining Control and Reclamation Act
16 and Corresponding OHA Implementing Regulations
17 In 1977, Congress enacted the SMCRA, 30 U.S.C. §1201 et seq., to “establish a
18
nationwide program to protect society and the environment from the adverse affects of surface
19
coal mining operations.” 30 U.S.C. §1202(a). The Office of Surface Mining Reclamation and
20
Enforcement (“OSM”) is the entity charged with implementing and enforcing the SMCRA. 30
21
22 U.S.C. §1211. Pursuant to the SMCRA, no entity may engage in a surface coal mining operation
23 without first obtaining a permit from OSM. 30 U.S.C. §1256(a). The statute further requires
24 mine operators to abide by performance standards incorporated into the permits. See, e.g., 30
25
U.S.C. §1265 (environmental protection performance standards). The SMCRA authorizes OSM
to assess civil penalties for violations of permit, or other SMCRA, requirements. 30 U.S.C.
ORDER-2
§1268(a) & (f). However, any such OSM decision may be appealed to the Secretary, and must
1
include the opportunity for a public hearing conducted in accordance with the Administrative
2
3 Procedure Act. 30 U.S.C. §1268(b). There are five SMCRA provisions that are relevant to this
4 case, each of which establishes a proceeding for the review of a particular type of agency action.
5 In 1978, OHA issued regulations outlining the procedures to be used at proceedings conducted
6
pursuant to the SMRCA. See 43 Fed. Reg. 34386 (1978). The relevant SMCRA provisions and
7
the corresponding OHA implementing regulations are described below.
8
a. Proceedings To Review Notices of Violation
9 or Cessation Orders (SMCRA §521)
10
Section 525(a)(1) of the SMCRA, 30 U.S.C. §1275(a)(1), provides as follows:
11
A permittee issued a notice or order by the Secretary pursuant to
12 the provisions of subparagraphs (a)(2) and (3) of section 521 of
this title [30 U.S.C. §1271], or pursuant to a Federal program or
13 the Federal lands program, or any person having an interest which
14 is or may be adversely affected by such notice or order or by any
modification, vacation, or termination of such notice or order, may
15 apply to the Secretary for review of the notice or order within
thirty days of receipt thereof or within thirty days of its
16 modification, vacation, or termination. Upon receipt of such
application, the Secretary shall cause such investigation to be made
17 as he deems appropriate. Such investigation shall provide an
18 opportunity for a public hearing, at the request of the applicant or
the person having an interest which is or may be adversely
19 affected, to enable the applicant or such person to present
information relating to the issuance and continuance of such notice
20 or order or the modification, vacation, or termination thereof. The
filing of an application for review under this subsection shall not
21
operate as a stay of any order or notice.
22
Under Section 525(a)(2), “[a]ny such hearing shall be of record and shall be subject to the
23
APA §554.
24
OHA’s implementing regulation for proceedings to review notices of violation or
25
cessation orders, 43 CFR 4.1171, provides that although OSM has the “burden of going forward
ORDER-3
to establish a prima facie case as to the validity” of the notice or order or its modification,
1
vacation or termination; the “ultimate burden of persuasion” rests with the applicant for review
2
3 b. Civil Penalty Proceedings (SMCRA §518)
4 Section 518(a) of the SMCRA, 30 U.S.C. 1268(a), provides that a permittee who violates
5 the Act or a permit condition may be assessed a civil penalty. Section 518(b) provides that the
6
penalty may only be assessed after the person charged with a violation has been given the
7
opportunity for a public hearing conducted in accordance with Section 554 of the APA. Section
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518(c) provides that the person charged may contest the amount of the penalty or the fact of the
9
10 violation. Section 518(b) provides that, when there has been a hearing, “the Secretary shall . . .
11 issue a written decision as to the occurrence of the violation and the amount of the penalty which
12 is warranted” and “shall consolidate such hearings with other proceedings under section 521”
13 when appropriate.
14
When OHA originally adopted the regulation governing burdens of proof in civil penalty
15
proceedings, 43 CFR 4.1155, it allocated the burden of going forward to establish a prima facie
16
case and the burden of persuasion to OSM, with respect to both the fact of violation and the
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18 amount of the penalty. 43 FR 34376, 34393 (Aug. 3, 1978). Ten years later, for a variety of
19 reasons (see 52 FR 38246-38247 (October 15, 1987)), OHA amended §4.1155 to provide that
20 “OSM shall have the burden of going forward to establish a prima facie case as to the fact of the
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violation and the amount of the civil penalty and the ultimate burden of persuasion as to the
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amount of the civil penalty.”A person who petitions for review of a proposed assessment of a
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civil penalty, however, has “the ultimate burden of persuasion as to the fact of the violation.”
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25
ORDER-4
c. Individual Penalty Proceedings
1 (SMCRA § 518(f))
2
Section 518(f) of the SMCRA, 30 U.S.C. 1268(f), provides that when a corporate
3
permittee violates a condition of its permit or fails or refuses to comply with any order issued
4
under Section 521 or any order in a final decision by the Secretary (with certain exceptions), any
5
director, officer, or agent of the corporation who wilfully and knowingly authorized, ordered, or
6
7 carried out the corporation's violation or its failure or refusal to comply, “shall be subject to the
8 same civil penalties . . . that may be imposed upon a person” under section 518(a).
9 43 CFR 4.1307(a) allocates to OSM the burden of going forward with evidence to
10
establish a prima facie case that (1) the corporation violated a permit condition or failed or
11
refused to comply with an order; (2) the individual was a director, officer, or agent of the
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corporation at the time of the violation; and (3) the individual acted wilfully and knowingly.
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14 Section 4.1307(b) imposes on the individual the ultimate burden of persuasion as to (1) whether
15 the corporation violated a permit condition or failed or refused to comply with an order and (2)
16 whether he or she was a director or officer at the time of the violation or refusal. Section
17 4.1307(c) imposes on OSM the ultimate burden of persuasion as to (1) whether the individual
18
was an agent of the corporation and (2) the amount of the individual civil penalty.
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d. Permit Suspension or Revocation Proceedings
20 (SMCRA §521(a)(4))
21
Section 521(a)(4) of the Act, 30 U.S.C. 1271(a)(4), provides as follows:
22
When, on the basis of a Federal inspection . . . , the Secretary or
23 his authorized representative determines that a pattern of violations
of any requirements of this Act or any permit conditions required
24 by this Act exists or has existed, and if the Secretary or his
authorized representative also finds that such violations are caused
25
by the unwarranted failure of the permittee to comply with any
requirements of this Act or any permit conditions, or that such
violations are wilfully caused by the permittee, the Secretary or his
ORDER-5
authorized representative shall forthwith issue an order to the
1 permittee to show cause as to why the permit should not be
suspended or revoked and shall provide opportunity for a public
2
hearing. If a hearing is requested, the Secretary shall inform all
3 interested parties of the time and place of the hearing. Upon the
permittee's failure to show cause as to why the permit should not
4 be suspended or revoked, the Secretary or his authorized
representative shall forthwith suspend or revoke the permit.
5
Section 525(d) of the SMCRA, 30 U.S.C. 1275(d), provides that the hearing shall be of
6
7 record and subject to Section 554 of the APA.
8 OHA's regulations at 43 CFR 4.1194 provide that, in such proceedings, OSM has the
9 burden of going forward to establish a prima facie case for suspension or revocation of the
10
permit, but the ultimate burden of persuasion that the permit should not be suspended or revoked
11
rests with the permittee.
12
e. Proceedings to Review Permit Revisions
13 Ordered by OSM (SMCRA §511)
14
Section 511 of the SMCRA, 30 U.S.C. § 1261, applies to revision of permits. Section
15
511(a) provides that, during the term of the permit, a permittee may apply for a revision to a
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permit. Section 511(c) provides that the regulatory authority must, within time limits prescribed
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18 in regulations, review outstanding permits and may require reasonable revision or modification
19 of permit provisions during the term of the permit. The revision or modification is to be “based
20 upon a written finding and subject to notice and hearing requirements established by the State or
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Federal program.” Id.22
OSM’s implementing regulations at 30 CFR 774.10(a) provide that the regulatory
23
authority must review each permit issued under an approved program not later than the middle of
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each permit term. The regulatory authority “may, by order, require reasonable revision of a
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permit * * * to ensure compliance with the Act and the regulatory program.” §774.10(b). Any
ORDER-6
order requiring revision of a permit “shall be based upon written findings and shall be subject to
1
the provisions for administrative and judicial review in [30 CFR] part 775.” §774.10(c). Under
2
3 §775.11(c), all hearings “under a Federal program for a State or a Federal lands program * * * on
4 an application for approval of * * * permit revision shall be of record and governed by 5 U.S.C.
5 554 and 43 CFR part 4.”
6
OHA's regulations at 43 CFR 4.1366(b) provide that, in a proceeding to review a permit
7
revision ordered by OSM, OSM has the burden of going forward to establish a prima facie case
8
that the permit should be revised, and the permittee has the ultimate burden of persuasion.
9
10 B. Procedural Background
11 In 1996, NMA filed a petition for rulemaking seeking amendment of OHA’s
12 implementing regulations for each of the five statutory provisions at issue. A.R. 104-28. NMA
13 argued that these five OHA regulations impermissibly shift the ultimate burden of persuasion
14
from the proponent of the regulation, as required by the APA, to the entity challenging agency
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action. A.R. 106-09. According to NMA, the impetus for this petition was the 1994 Supreme
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Court opinion in Director, Office of Workers’Comp. Programs, Dep’t of Labor v. Greenwich
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18 Collieries, 512 U.S. 267 (1994). A.R. 110-14. In Greenwich Collieries, the Supreme Court
19 invalidated a rule utilized by Department of Labor Administrative Law Judges in certain types of
20 claim adjudications. Greenwich Collieries, 512 U.S. 267, 281 (1994). The Court ruled that the
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“True Doubt Rule” impermissibly shifted the burden of persuasion, in circumstances where the
22
evidence was equally balanced, from the claimant to the party opposing the benefits claim, in
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violation of the APA. Id. The Supreme Court evaluated the meaning of the term “burden of
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proof” as used in APA §556(d) and concluded that it referred to the ultimate burden of
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persuasion, not simply the burden to present prima facie evidence in support of a claim. Id. at
ORDER-7
276. NMA argued that that the holding of Greenwich Collieries required OHA to amend its
1
regulations to be consistent with the APA requirement that OSM, as proponent of the challenged
2
3 action, carry the ultimate burden of proof. A.R. 114. OHA declined to consider the petition at
4 that time, deciding that it would be most prudent to wait for a decision in a related litigation,
5 National Mining Association v. U.S. Dep’t of the Interior, 251 F.3d 1007 (D.C. Cir. 2001)
6
(“NMA v. DOI 2001”). 1
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C. OHA’s November 28, 2003 Decision
8
In 2003, having received no ruling, NMA requested that OHA rule on its 1996 petition.
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10 A.R. 77-78. On March 20, 2003, OHA published the petition in the Federal Register for public
11 comment. A.R. 2-6, 68 Fed. Reg. 13657, March 20, 2003. On November 28, 2003, OHA
12 published its decision, substantially denying the petition. A.R. 18-23, 68 Fed. Reg. 6672313 (November 28, 2003).
14
The crux of OHA’s ruling is its disagreement with “the premise of the NMA petition, i.e.,
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16 that SMCRA does not provide for a burden of proof distinct from that set forth in section 556(d)
17 of the APA for the proceedings NMA addresses.” A.R. 19, 68 Fed. Reg. 66723 (November 28,
18 2003), p. 66724. OHA found that the SMCRA itself contained allocations of the burden of proof
19 for the types of hearings at issue, and that therefore, the burden of proof allocation contained in
20
APA §556(d), as well as the Supreme Court’s interpretation of it, is irrelevant. A.R. 19, 68 Fed.
21Reg. 66723 (November 28, 2003), p. 66724. OHA, however, did not issue a simple denial of
22
NMA’s petition. OHA instead analyzed each of the challenged regulations, finding, with one
23
24 exception, that the corresponding SMCRA provision contained a burden of proof allocation,
25 1
National Mining Association v. U.S. Dep’t of the Interior, 251 F. 3d 1007 (D.C. Cir. 2001) involved an NMA
challenge to certain OHA regulations not at issue in the instant action.
ORDER-8
excepting it from the APA’s burden of proof allocation. A.R. 19-21, 68 Fed. Reg. 667231
(November 28, 2003), pp. 66724-26.
2
3 For example, with regard to proceedings to review notices of violation or cessation orders
4 pursuant to SMCRA §521(a)(1), OHA noted that both the legislative history and the text of the
5 SMCRA make it clear that the purpose of this type of hearing is enable the operator to “present
6
information,” and that as such, the statute contemplates the operator carrying the ultimate
7
burden. 68 Fed. Reg. 66723 (November 28, 2003), p. 66724. In support of its position, OHA
8
cited a 7th Circuit case, Old Ben Coal Corp. v. Interior Board of Mine Operations Appeals, 523
9
10 F. 2d 25 (7th Cir. 1975). 68 Fed. Reg. 66723 (November 28, 2003), p. 66724. In Old Ben, the 7th
11 Circuit held that the predecessor statute to the SMCRA, the Coal Mine Health and Safety Act,
12 using substantially similar language as the SMCRA, contained an allocation of the burden of
13 proof for a similar type of hearing. Old Ben, 523 F. 2d 25, 36 (7th Cir. 1975). OHA explained its
14
view that Old Ben survived the holding of Greenwich Collieries. 68 Fed. Reg. 66723-01, p.
15
66724. However, OHA did amend one of its regulations pursuant to NMA’s petition. OHA
16
reached the conclusion that the SMCRA does not provide for a burden allocation with respect to
17
18 a hearing imposing civil penalties on an individual who played a role in a corporation that was in
19 violation of the SMCRA. 68 Fed. Reg. 66723-01, pp. 66725-6. As such, OHA concluded that
20 APA §556(d) was applicable, and OSM should carry the full burden of persuasion in hearings
21
imposing this kind of penalty. 68 Fed. Reg. 66723-01, pp. 66725-6.
22
On January 27, 2004, NMA filed the instant action seeking review of OHA’s decision.
23
24 II. ARGUMENTS ON SUMMARY JUDGMENT
25 NMA argues that OHA’s substantial denial of NMA’s petition for rulemaking was
arbitrary and capricious because the APA mandates that the burden of persuasion fall on OSM.
ORDER-9
NMA contends that such requirement is not contradicted by anything in the SMCRA. NMA
1
further asserts that the challenged regulations violate well-established precepts of fairness and
2
3 due process.
4 Defendants oppose NMA’s motion and filed a cross motion for summary judgment.
5 Defendants assert that this court lacks jurisdiction to hear what they characterize as a substantive
6
challenge to five of OHA’s longstanding regulations. Moreover, Defendants, argue, even if the
7
court has jurisdiction, the denial of NMA’s petition for rulemaking is entitled to “extreme”
8
deference. Finally, Defendants believe that OHA’s regulations easily survive under any level of
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10 judicial scrutiny.
11 III. DISCUSSION
12 A. Summary Judgment Standard
13 The court shall grant summary judgment if the movant shows that there is no genuine
14
dispute as to any material fact and the movant is entitled to judgment as a matter of law. Fed. R.
15
Civ. P. 56(a). We “draw all reasonable inferences in favor of the nonmoving party, and . . . may
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not make credibility determinations or weigh the evidence.” Reeves v. Sanderson Plumbing
17
18 Prods., Inc., 530 U.S. 133, 150 (2000) (citations omitted). In deciding whether summary
19 judgment is appropriate, therefore, we resolve doubts in favor of the non-moving party.
20 Anderson v. Liberty Lobby, Inc., 447 U.S. 242, 255 (1986) (citation omitted).
21
B. Jurisdiction
22
The SMCRA provides that any “action by the Secretary promulgating national rules or
23
regulations . . . shall be subject to judicial review in the United States District Court for the
24
District of Columbia Circuit.” 30 U.S.C. §1276(a)(1). A petition for review of any such action
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must be filed “within sixty days from the date of such action, or after such date if the petition is
ORDER-10
based solely on grounds arising after the sixtieth day.” Id. This temporal limitation is
1
jurisdictional in nature. National Mining Ass’n v. Department of the Interior, 70 F.3d 1345, 1350
2
3 (D.C. Cir. 1995) (“NMA v. DOI 1995”). OHA promulgated the challenged rules in 1978, 1988,
4 and 1991. Thus, there is no doubt that NMA’s January 27, 2004 complaint was filed long after
5 the 60-day period expired. However, there are two exceptions to the 60-day limitation, and NMA
6
attempts to avail itself of each.
7
1. Petition Based Solely on Grounds Arising After the 60th Day
8
The first exception is contained in the language of SMCRA §1276(a)(1), which provides
9
10 that an action challenging the Secretary’s rules may be brought outside the 60-day period “if the
11 petition is based solely on grounds arising after the sixtieth day.” NMA argues that the sole
12 ground for its complaint was OHA’s November 28, 2003 decision not to amend its regulations
13 pursuant to the Court’s opinion in Greenwich Collieries. Defendants object to that
14
characterization, arguing that in reality, “the gravamen of the complaint is that the longstanding
15
OHA rules are unlawful.” Memorandum in Support of Defendants’ Cross Motion at 6.
16
Defendants take the position that Greenwich Collieries merely provided NMA with a pretext for
17
18 making a substantive challenge to the rules, and that such arguments were available to NMA
19 within the 60-day time frame. After a careful review of the complaint, the court is unable to
20 agree with Defendants. OHA’s denial of NMA’s petition to amend the regulations pursuant to
21
the holding of Greenwich Collieries is clearly the impetus for, as well as the true basis of, the
22
complaint. The court therefore finds that NMA’s complaint is based solely on grounds arising
23
after the 60th day.
24
However, the parties’ arguments do not end there. SMCRA §1276(a)(1) does not provide
25
guidance on what statute of limitations should be applied to a complaint that fits into its
ORDER-11
exception language. Instead, Defendants ask that the court employ the general six-year statute of
1
limitations for actions against the U.S. contained in 28 U.S.C. §2401(a), and find the action
2
3 untimely. They suggest to the court that any grounds arising after the 60th day would have to be
4 the issuance of Greenwich Collieries in 1994, rather than OHA’s 2003 decision. Defendants
5 hotly characterize the period between the Greenwich Collieries decision and NMA’s filing of a
6
complaint as a delay of “more than nine years.” In turn, NMA blames OHA for the time that
7
elapsed while it waited for NMA v. DOI 2001 to be resolved, but offers no guidance to the court
8
about what statute of limitation should apply to the exception language of SMCRA §1276(a)(1).
9
10 A pointed review of the chronology of this case reveals that Defendants, not Plaintiff, are
11 to blame for the bulk of the delay in the filing of NMA’s complaint. The Supreme Court opinion
12 in Greenwich Collieries was issued on June 20, 1994. Approximately 18 months later, on
13 January 17, 1996, NMA filed its petition with OHA seeking review of the regulations pursuant to
14
Greenwich Collieries. On March 25, 1996, OHA informed NMA that it would postpone
15
consideration of the petition pending resolution of a separate litigation between NMA and OHA
16
over different regulations. That case, NMA v. DOI 2001, was not decided until June 8, 2001, over
17
18 five years after OHA postponed ruling on NMA’s petition. After the issuance of the opinion in
19 NMA v. DOI 2001, OHA still took no action to consider NMA’s 1996 petition. About 18 months
20 later, on January 4, 2003, after NMA formally requested that OHA rule on its 1996 petition.
21
OHA published it on March 20, 2003, as a “resubmitted” petition and sought comments. OHA
22
issued its final decision on November 28, 2003. NMA filed its complaint in District Court on
23
January 27, 2004, on the 60th day after OHA issued its decision.
24
This review reveals that a major part of the delay stemmed from OHA’s unwillingness to
25
consider NMA’s petition until NMA v. DOI 2001 was decided. In NMA v. DOI 2001, NMA
ORDER-12
challenged, among other things, the burden of proof allocations contained in two OHA
1
regulations: 43 C.F.R. §§4.1374 and 4.1384. Neither of these regulations is being challenged by
2
3 NMA in the instant case. The court sees no reason to opine about whether OHA’s decision to
4 wait for a final ruling on 43 C.F.R. §§4.1374 and 4.1384 before proceeding with NMA’s
5 challenge to the instant regulations was reasonable or not. Whether or not this postponement was
6
justified, it is somewhat disingenuous of Defendants to attack NMA at this point on the basis of
7
delay.
8
It is true that NMA could have filed suit at any time after Greenwich Collieries, without
9
10 waiting for OHA to rule on its petition. However, NMA contends, probably correctly, that OHA
11 would have moved to dismiss the complaint on ripeness grounds, or for a failure to exhaust
12 administrative remedies. Such cases are routinely dismissed as premature where plaintiffs file
13 actions without waiting for an agency to reach a final administrative decision. See, e.g.,
14
Tennessee Gas Pipeline Co. v. FERC, 9 F.3d 980, 980-81 (D.C. Cir. 1993) (a petition for review
15
filed while a request for agency reconsideration is pending is “incurably premature”); In re
16
Monroe Communications Corp., 840 F.2d 942, 945-46 (D.C. Cir. 1988) (in mandamus action,
17
18 three years of “administrative limbo” not unreasonable considering the great latitude given
19 agencies to determine their own agendas). It was reasonable of NMA, therefore, to complete the
20 administrative process prior to filing this action. After all, NMA had reason to believe a ruling
21
from OHA would be forthcoming. A.R. at 80. Defendants would have the court place NMA in a
22
Catch-22 situation, wherein would have to choose between filing this action without a final
23
agency decision and having it dismissed as premature, or waiting, and then having the case
24
dismissed as untimely. Clearly, that is an untenable situation for the Plaintiff.
25
ORDER-13
The court finds that there is jurisdiction pursuant to the exception contained in the
1
language of SMCRA §1276(a)(1), which provides that an action challenging the Secretary’s
2
3 rules may be brought outside the original 60-day period “if the petition is based solely on
4 grounds arising after the sixtieth day.” The court further finds that the ground arising after the
5 60th day was OHA’s November 28, 2003 decision. In the absence of any guidance to the
6
contrary, the court assumes that the 60-day statute of limitations provided for in the statute
7
reasserts itself to apply to any action filed pursuant to the exception. NMA’s action, filed on the
8
60th day after OHA’s November 28, 2003 decision, is therefore timely.
9
10 2. Reopener Doctrine
11 Moreover, the court is persuaded that there is another basis for jurisdiction. The
12 “reopener doctrine” provides that a period for seeking judicial review can begin anew “when the
13 agency in question by some new promulgation creates the opportunity for renewed comment and
14
objection.” Edison Elec. Institute, 996 F.2d 326, 331 (D.C. Cir. 1993) (citation omitted). NMA
15
contends that OHA’s November 28, 2003 decision reconsidering the burden of proof allocations
16
in the five regulations at issue in light of Greenwich Collieries qualifies under the reopener
17
18 doctrine to give this court jurisdiction.
19 Defendants counter that OHA’s decision cannot be called a reopening of the rules,
20 because OHA articulated the same rationale in 2003 for the rules as it did in 1978, i.e., that that
21
SMCRA “as supported by the legislative history” allocates the burden of proof. See 43 Fed. Reg.
2234,381 (1978) (“In addition, the legislative history clearly states that an applicant for review has
23
the ultimate burden of proof in proceedings to review notices and orders.”) NMA replies that
24
OHA may have articulated the same rationale, but relied on it in a different enough manner as to
25
justify judicial review of its position.
ORDER-14
In 1978, OHA justified the burden of proof allocations contained in its regulations as
1
allowable under the APA and under the legislative history of the SMCRA. OHA made reference
2
3 to the language of SMCRA §521(a)(4), interpreting it to mean that the ultimate burden of proof
4 should rest with the permittee. 43 C.F.R. 34376, 34382. In its November 28, 2003 decision,
5 however, it supported its allocations somewhat differently, classifying them as falling within the
6
APA exception to its burden of proof allocation. 68 Fed. Reg. 66723 (November 28, 2003),
7
p.66724. NMA believes that OHA’s consideration of NMA’s rulemaking petition in 2003,
8
altering the reasoning supporting the burden allocations in the rules and amending one of its
9
10 rules in reaction to NMA’s petition pursuant to Greenwich Collieries reflects OHA’s
11 reconsideration – and thus reopening – of the rules. “[W]here an agency’s actions show that it
12 has not merely republished an existing rule. . . but has reconsidered the rule and decided to keep
13 it in effect, challenges to the rule are in order.” Public Citizen v. NRC, 901 F.2d 147, 150 (D.C.
14
Cir. 1990).
15
Defendants admit that OHA “no longer relies on its previous understanding” of the
16
meaning of the term “burden of proof” under the APA, and also concedes that it “had never
17
18 expressly referenced the APA’s ‘exception’ language until its 2003 petition denial.”
19 (Memorandum in Support of Defendants’ Cross Motion at 8-9.) However, they oppose a finding
20 of jurisdiction based on the reopener doctrine. Defendants call the court’s attention to NMA v.
21
DOI, 70 F.3d 1345, 1350-52 (D.C. Cir. 1995) (“NMA v. DOI 1995”), a case in which the D.C.
22
Circuit Court declined to find jurisdiction on this basis. In NMA v. DOI 1995, the court held
23
defendants’ mere publication of a rule-making petition and statement of denial insufficient to
24
justify reopening, and that doing so under those circumstances “would make a mockery of
25
ORDER-15
Congress’ careful effort to force potential litigants to bring challenges to a rule issued under
1
[SMCRA] at the outset[.]” NMA v. DOI 1995, 70 F. 3d at 1350-51.
2
3 NMA v. DOI 1995, however, does more for the plaintiff than for the defendants. That
4 court based its opinion in part on the fact that the arguments the plaintiff made were all
5 arguments that had been available to it at the time the rule was adopted. NMA v. DOI 1995, 70
6
F.3d at 1350. In the instant matter, NMA had an entirely new ground for attacking the
7
regulations—Greenwich Collieries’ interpretation of APA §556(d). In addition, in NMA v. DOI
8
1995, the court contrasted the facts of that case with the facts of one in which the court chose to
9
10 apply the reopener doctrine. NMA v. DOI 1995, 70 F.3d at 1352. The NMA v. DOI 1995 court
11 noted that in Public Citizen v. Nuclear Regulatory Comm’n, 901 F.2d 147 (D.C. Cir. 1990), the
12 court had found that the agency undertook a serious, substantive reconsideration of the rule at
13 issue. Id.14
In the instant matter, the same may be said. OHA published NMA’s petition, gathered
15
and considered comments on it, and crafted its November 28, 2003 decision carefully. The fact
16
that OHA altered, at least to some extent, the basis underpinning the allocations of the burden of
17
18 proof and actually amended one of its rules pursuant to NMA’s petition, are further proof that it
19 undertook the kind of serious, substantive reconsideration that justifies application of the
20 reopener doctrine.
21
C. Standard of Review
22
The APA §706, Scope of Review, provides, in relevant part:
23
To the extent necessary to decision and when presented, the
24 reviewing court shall decide all relevant questions of law, interpret
constitutional and statutory provisions, and determine the meaning
25
or applicability of the terms of an agency action. The reviewing
court shall—
ORDER-16
(1) compel agency action unlawfully withheld or unreasonably
1 delayed; and
2
(2) hold unlawful and set aside agency action, findings, and
3 conclusions found to be—
4 arbitrary, capricious, an abuse of discretion, or otherwise not in
accordance with law;
5
contrary to constitutional right, power, privilege, or immunity;
6
in excess of statutory jurisdiction, authority, or limitations, or short
7 of statutory right;
8 without observance of procedure required by law; . . .
9 In making the foregoing determinations, the court shall review the
10 whole record or those parts of it cited by a party, and due account
shall be taken of the rule of prejudicial error.
11
The SMCRA provides that: “Any action subject to judicial review under this subsection
12
shall be affirmed unless the court concludes that such action is arbitrary, capricious, or otherwise
13
14 inconsistent with law.” SMCRA §1276(a)(1). SMCRA §1276(b) also states that except as
15 provided in Section 1276(a):
16 the findings of the Secretary if supported by substantial evidence
on the record considered as a whole, shall be conclusive. The court
17 may affirm, vacate, or modify any order or decision or may
18 remand the proceedings to the Secretary for such further action as
it may direct.
19
APA §706 has inspired many interpretations. As the D.C. Circuit court stated in WWHT,
20
Inc. v. FCC, 656 F.2d 807, 817 (1981), “the parameters of the arbitrary and capricious standard
21
22 of review [under APA §706] will vary with the context of the case.” (Internal quotation marks
23 omitted.) The court stressed, however, that “[i]t is only in the rarest and most compelling of
24 circumstances that this court has acted to overturn an agency judgment not to institute a
25
rulemaking.” Id. at 818. See also EMR Network v. Federal Communications Comm’n, 391 F.3d
ORDER-17
269, 272-73 (D.C. Cir. 2004) (citation omitted), cert. denied, EMR Network v. F.C.C., 545 U.S.
11116 (2005) (same).
2
3 Defendants urge the court to employ the most deferential standard of review. In fact, they
4 believe the court must view OHA’s actions with deference so extreme that it is “akin to non-
5 reviewability.” Memorandum in Support of Defendants’ Cross Motion at 15, quoting Cellnet
6
Communication, Inc. v. FCC, 965 F.2d 1106, 1111 (D.C. Cir. 1992). Defendants assert that in
7
order to survive judicial scrutiny under this extremely deferential standard of review, an agency
8
need only provide an “adequate response” to the concerns raised in a rulemaking petition. NMA
9
10 v. DOI 1995, 70 F.3d at 1353. See also National Coal Ass’n v. Uram, 1994 WL 736422, at *4
11 (D.D.C. Sept. 16, 1994) (standard of review is “narrow” and rule must be affirmed if there is a
12 “rational basis” for the agency’s decision). Defendants also take the position that deference to an
13 administering agency “is particularly appropriate” when dealing with a “complex regulatory
14
statute” such as SMCRA. In re Permanent Surface Mining Regulation Litigation, 653 F.2d 514,
15
522-23 (D.C. Cir. 1981).
16
To the contrary, NMA claims that OHA’s November 28, 2003 decision is subject to a
17
18 searching review. NMA explains that under APA §706, the court is required to “engage in a
19 substantial inquiry” and a conduct a “thorough, probing, in-depth review.” Citizens to Preserve
20 Overton Park, Inc. v. Volpe, 401 U.S. 402, 415 (1971), overturned on other grounds by Califano
21
v. Sanders, 430 U.S. 99, 105 (1977). See also James Madison Ltd. v. Ludwig, 82 F.3d 1085, 1098
22
(D.C. Cir. 1996) (“judicial review of agency action under the APA must go beyond the agency’s
23
procedures to include the substantive reasonableness of its decision”). NMA also claims that a
24
specific circumstance in this case lends extra support in favour of a probing review. NMA draws
25
the court’s attention to a 2004 case in which the D.C. Circuit held that one of the “strongest
ORDER-18
potential bases for overturning an agency’s refusal to initiate a rulemaking [occurs when] a
1
significant factual predicate of a prior decision on the subject has been removed.” EMR Network,
2
3 391 F.3d at 273-74 (citation omitted). NMA argues that the issuance of the opinion in Greenwich
4 Collieries effectively removed a factual predicate upon which OHA had justified the burden
5 allocation in the relevant rules, and thus justifies a less deferential review.
6
The court finds that the appropriate standard of review in this case to be somewhat
7
broader than that urged by Defendants, but narrower than that envisaged by NMA. In general,
8
rulemaking is a legislative function that should be left to the discretion and expertise of an
9
10 agency. In WWHT, Inc. v. Federal Communications Commission, 656 F.2d 807, 809 (D.C. Cir.
11 1981), the petitioners sought review of two Federal Communications Commission (“FCC”)
12 orders excluding certain scrambled signals from local pay stations from the mandatory carriage
13 requirements of local cable television operators. The court in that case affirmed the orders of the
14
FCC, holding that the decision to institute rulemaking is “largely committed to the discretion of
15
the agency, and that the scope of review of such a determination must, of necessity, be very
16
narrow.” Id. “The Commission’s substantive determinations are essentially legislative . . . and
17
18 are thus committed to the discretion of the agency.” Id. at 819. However, this does not mean that
19 the court does not have an obligation to conduct a “thorough, probing, in-depth review.” Citizens
20 to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 415 (1971), overturned on other grounds
21
by Califano v. Sanders, 430 U.S. 99, 105 (1977).
22
Most importantly, the court is not persuaded by NMA’s argument that the issuance of the
23
Supreme Court decision in Greenwich Collieries constitutes the removal of “a significant factual
24
predicate of a prior decision[.]” EMR Network, 391 F.3d at 273-74 (citation omitted). The
25
Supreme Court’s interpretation of the APA is not a factual matter; it is a legal determination. The
ORDER-19
instant case is therefore distinguishable from cases in which courts have found that changed
1
factual circumstances warranted less deferential review. For example, in Geller v. Federal
2
3 Communications Commission, 610 F.2d 973 (D.C. Cir. 1979), a newly enacted law removed the
4 sole basis for certain FCC regulations, which had been an agreement reached some years prior.
5 The agency, however, steadfastly refused to either terminate the regulations or show that they
6
continued to have some basis in law. Id. at 979-80. The D.C. Circuit vacated the FCC order and
7
remanded, explaining that an agency “cannot sidestep a re-examination of particular regulations
8
when abnormal circumstances make that course imperative.” Id. at 979. But the change in Geller
9
10 was to the facts underpinning the rules—the agreement that was eventually superseded. In the
11 instant case, the issuance of Greenwich Collieries removed some of the legal, not factual,
12 justification for OHA’s regulations.
13 Moreover, in the instant case, OHA did not refuse to address the change in
14
circumstances. However belatedly, OHA provided a detailed opinion explaining why, despite the
15
opinion in Greenwich Collieries, it declined to amend the majority of the regulations at issue.
16
OHA articulated two reasons for its decision that Greenwich Collieries did not mandate revision
17
18 of the challenged burden of proof allocations. First, OHA interpreted Greenwich Collieries as
19 applicable only in situations where the evidence is equally balanced between the parties. 68
20 C.F.R. 66723 at 66724. Second, OHA explained its belief that the SMCRA itself provides for
21
burden of proof allocations which means that the burden of proof allocations at issue are not
22
governed by APA §556(d). 68 C.F.R. 66723 at 66724. This iteration of its reasoning, along with
23
OHA’s decision to amend one of the regulations at issue, distinguishes it from cases in which
24
agencies have summarily refused to institute rulemakings. See, e.g., American Horse Protection
25
ORDER-20
Ass'n, 812 F.2d 1, 6 (D.C. Cir. 1987) (agency’s two sentence conclusory explanation for its
1
refusal to proceed with rulemaking found insufficient).
2
3 The APA clearly states that unless “otherwise provided by statute, the proponent of a rule
4 or order has the burden of proof.” 5 U.S.C. §556(d) (emphasis added). While the court is not
5 charged with independently assessing the correctness of OHA’s determinations, it does appear,
6
with respect to the challenged regulations, that the SMCRA provides for a burden of proof
7
distinct from that set forth in APA §556(d). It follows then that where a statute so provides, an
8
agency is free to place the burden of proof on a party other than the proponent of a rule or order.
9
10 The court may “overturn an agency's decision not to initiate a rulemaking only for
11 compelling cause, such as a plain error of law or a fundamental change in the factual premises
12 previously considered by the agency.” National Customs Brokers & Forwarders v. United
13 States, 883 F.2d 93, 96-97 (D.C.Cir.1989) (citing American Horse Protection Ass'n v. Lyng, 812
14
F.2d 1, 5 (D.C.Cir.1987). For all the foregoing reasons, the court finds that OHA’s decision was
15
neither arbitrary nor capricious. It would be improper for the court, under these facts, to disturb
16
OHA’s findings.
17
18 The court hereby GRANTS Defendants’ Cross Motion for Summary Judgment, DENIES
19 NMA’s Motion for Summary Judgment, and DISMISSES the case, with prejudice.
20 DATED this 15th day of April, 2011.
21
22
23
24
ABarbara Jacobs Rothstein
U.S. District Court Judge
25
ORDER-21