Dia Navigation Company, Ltd v. Pomeroy

Opinions of the United
1994 Decisions States Court of Appeals
for the Third Circuit
6-28-1994
Dia Navigation Company, Ltd v. Pomeroy, et al.
Precedential or Non-Precedential:
Docket 93-5538
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UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No. 93-5538
DIA NAVIGATION COMPANY, LIMITED
Appellant
v.
JAMES POMEROY, DISTRICT DIRECTOR IMMIGRATION
AND NATURALIZATION SERVICE; CHRIS SALE,
COMMISSIONER IMMIGRATION AND NATURALIZATION SERVICE;
JANET RENO, ATTORNEY GENERAL DEPARTMENT OF JUSTICE
On Appeal From the United States District Court
For the District of New Jersey
(D.C. Civil Action No. 93-cv-01366)
Argued: March 24, 1994
Before: HUTCHINSON, ROTH and ROSENN, Circuit Judges
(Opinion Filed June 28, 1994)
Stephen H. Vengrow, Esquire
Joseph F. DeMay, Jr., Esquire (Argued)
Cichanowicz, Callan & Keane
21 West Street, 26th Floor
New York, NY 10006-2908
Attorney for Appellant
Faith S. Hochberg
United States Attorney
1
James B. Clark, III,
Assistant United States Attorney
970 Broad Street, Room 502
Newark, NJ 07102
Frank W. Hunger
Assistant Attorney General
Mark C. Walters
Assistant Director
Alexander H. Shapiro, Esquire (Argued)
Office of Immigration Litigation
U.S. Department of Justice
Ben Franklin Station
P.O. Box 878
Washington, D.C 20044
Attorneys for Appellees
OPINION OF THE COURT
ROTH, Circuit Judge:
In this case, we are asked to examine the Immigration
and Naturalization Service's ("INS") policy of placing upon
common carriers the burden of detaining stowaways who have
applied for asylum in the United States. In brief, we conclude
that the provisions of the Immigration and Naturalization Act
("INA") lack the requisite clarity which would justify the policy
as it presently has been established. In light of the statutory
ambiguity and of the characteristics of the INS policy, we
believe that the policy constitutes a legislative rule which
could only have been promulgated pursuant to the notice and
comment provisions of the Administrative Procedure Act ("APA").
For this reason, we conclude that the District Court improperly
2
dismissed the appellant's complaint under Fed.R.Civ.P. 12(b)(6).
We further find that the district court improperly denied
appellant's motion for summary judgment insofar as it sought a
judgment declaring that the INS policy on detention of stowaways
who have applied for asylum is invalid for failure to comply with
the notice and comment procedures of the APA. We do find,
however, that the district court properly dismissed appellant's
other claims, including its claim for reimbursement of the
expenses it incurred in detaining the stowaways involved in this
case.1 We will, therefore, reverse in part and affirm in part
the order of the district court and we will remand this case to
the district court to enter judgment in favor of appellant
consistent with this opinion.
I.
Appellant Dia Navigation Company, Ltd., ("Dia") is a
Cyprus corporation which owns the M/V European Senator
("Senator"), an ocean carrier which transports commercial cargo
between the United States and Europe. On February 13, 1993, four
Romanian stowaways were found aboard the Senator while it was en
route from Le Havre, France, to the Port of Newark, New Jersey.
The stowaways were presented to and interviewed by an INS
inspection officer upon arrival in Newark on February 21, 1992.
None of the four Romanians had proper identification for entry
into the United States. The INS officer verified that they were
1
Because the stowaways involved in this case have now either been
deported or granted asylum, we do not reach appellant's claim for
injunctive relief.
3
in fact stowaways, which meant that they were subject to
deportation without an exclusion hearing. However, each of the
stowaways requested political asylum.
Under existing INS policy, the carrier on which a
stowaway arrives must pay the expenses of detaining him for as
long as it takes the INS to process his asylum claim.
Accordingly, the INS officer presented the ship's master with a
Form I-259 "Notice to Detain, Deport, Remove or Present Aliens."
The form provided that "[p]ursuant to the provisions of the
Immigration and Nationality Act, and the Regulations issued by
the Attorney General thereunder," App. at 25, the aliens were to
be detained on board the ship. A notation on the form read:
"CARRIER IS RESPONSIBLE FOR THE DETENTION[,] TRANSPORTATION AND
WELFARE OF THE ALIEN UNTIL OTHERWISE INSTRUCTED BY USINS." Id.
The form was presumably accompanied by some indication by the
officer that Dia could detain the stowaways off the ship pending
the processing of their asylum claims.
Dia complied with INS's orders, housing the stowaways
in two rooms at the Staten Island Holiday Inn and hiring armed
guards to maintain one guard per stowaway around the clock.2
During the detention, one of the detainees began a hunger strike
and threatened to commit suicide. To prevent this, the guards
placed him in a separate room and put him in leg irons. Faced
2
According to Dia, if it had refused to assume the detention
costs, the Senator would have been prevented from entry into or
departure from the Port of Newark.
4
with this situation, Dia requested that INS assume custody of
this detainee; INS refused to do so.
Furthermore, because INS would not convene a hearing on
the asylum claims until it had received completed asylum
applications, Dia had to hire a Romanian interpreter to help with
preparation of the forms and to assist at the asylum hearings.
Ultimately two of the stowaways' asylum requests were granted;
the other stowaways were flown back to Romania at Dia's expense.3
In the end, the Romanians were detained for a total of 54 days.
Dia claims to have incurred $127,580 in detention-related
expenses.
At this point we pause to note that the processing of
asylum applications often takes a considerable amount of time.
Indeed, the proceedings in this case appear to have been
relatively speedy. Dia cites a General Accounting Office report
which indicates that in the period from 1986 to 1989 the average
amount of time required to process an asylum application ranged
from 5.8 months in San Francisco to 31.2 months in Chicago.
General Accounting Office, Report to Congress: Immigration
Management 49 (1991). Moreover, our attention has been directed
to no set standards, in the form of regulations or otherwise,
concerning the conditions under which such aliens are detained.
Instead, INS apparently claims the discretion to order whatever
measures and impose whatever conditions of detention it deems
appropriate. In a hearing before the district court, counsel for
3
Dia does not contest having been required to pay the return
travel expenses of the deported stowaways.
5
INS claimed that INS could require carriers to detain stowaways
for any period of time, without limitation. App. at 131-34, 136-
38. In response to this assertion, the district court judge
inquired: "You can have [an INS officer] who has a bad day and
says, I want two guards on this guy 24 hours a day, I want him
put in the Plaza, I want him given gourmet meals, and you're
telling me that th[e] vessel owner can't say a thing about that,
right?" Counsel for the INS simply responded, "Yes." App. at
165.
On March 30, 1993, Dia filed suit under 28 U.S.C. §2201
seeking 1) a declaratory judgment that the INS policy requiring
an ocean carrier to both detain stowaways who have applied for
political asylum and be responsible for those stowaways'
attendant detention costs and expenses was unlawful and void and
2) an injunction to prohibit the INS from enforcing or attempting
to enforce the policy. Dia contended that the INS violated the
INA, including the User Fee provisions, the APA, and the INS's
own regulations. Dia further claimed a right under the APA and
the Tucker Act to reimbursement of the expenses it had incurred
in detaining the aliens as well as for its related expenses.
Defendants filed their answer to the complaint on May
14, 1993. On May 28, 1993, the government filed a motion to
dismiss under Fed.R.Civ.P. 12(b)(6), and Dia filed a motion for
summary judgment. On August 11, 1993, the district court granted
the government's motion, construing it as a motion for summary
judgment, and dismissed the complaint. This appeal followed.
6
Dia advances a number of arguments on appeal. It
contends first that the INA by its terms requires the INS to bear
the costs of detaining stowaways who apply for asylum and that
this court need not defer to the INS's interpretation of the
statute. Dia next asserts that the INS policy violates the INS's
own regulations and that the INS's action in this case was
arbitrary and capricious. Dia's final attack on the INS policy,
and the one with which we agree, is that the policy should have
been promulgated pursuant to notice and comment rulemaking. Dia
also argues that the district court improperly dismissed its
claims for monetary relief.
II.
The district court had jurisdiction over this case
pursuant to 5 U.S.C. § 702, 8 U.S.C. § 1329, and 28 U.S.C. §1331.
We have jurisdiction over Dia's timely appeal of the final
decision of the district court pursuant to 28 U.S.C. § 1291. Our
decision not to consider Dia's claim for injunctive relief, see
supra note 1, does not render this appeal moot. We must consider
the relevant statutory provisions and their interpretation by INS
in addressing Dia's claims for monetary relief. See 13A Charles
A. Wright et al., Federal Practice and Procedure § 3533.8 at 378
(1984). Moreover, to the extent that the claims for damages may
not support the depth of our analysis, we believe that this case
is among those "capable of repetition, yet evading review." In
such cases a finding of mootness is avoided by a determination
that the complaining party may reasonably expect to be subject to
the challenged activity in the future and that the challenged
7
activity is by its nature so short in duration that its validity
could not be fully adjudicated prior to its cessation or
termination. See Reich v. Local 30, Int'l Brotherhood of
Teamsters, 6 F.3d 978, 984 (3d Cir. 1993). See also United
States v. Simone, 14 F.3d 833, 836-37 (3d Cir. 1994); Clark v.
Brewer, 776 F.2d 226, 229 (8th Cir. 1985); Finberg v. Sullivan,
634 F.2d 50, 55 (3d Cir. 1980) (in banc). Both factors are
present here. The international nature of Dia's business makes
it quite possible that it will be confronted with the problem of
stowaways in the future. And the amount of time required to
process asylum applications, while lengthy, is typically less
than would be necessary to adjudicate the validity of the INS
policy. Cf. ITT Rayonier v. United States, 651 F.2d 343, 346
(5th Cir. Unit B July 1981) ("We would be most reluctant to
permit a federal agency to so arrange its timetables that the
scope of its authority would continue to elude judicial
scrutiny.").
Because this case concerns the district court's grant
of summary judgment, we have plenary review. E.g., Erie
Telecommunications, Inc. v. City of Erie, 853 F.2d 1084, 1093 (3d
Cir. 1988).
III.
Under the INA, all aliens arriving in the United States
are subject to examination and inspection by an INS inspector
whose duty it is to determine whether they are permitted to enter
the country. See 8 U.S.C. §§ 1224-25; 8 C.F.R. § 235.3. If an
alien does not appear to be someone clearly entitled to enter--
8
that is, if the INS inspector suspects that the alien is an
"excludable" alien--he is subject to an exclusion hearing to
determine whether he is eligible to remain. "Excludable" aliens
are defined in 8 U.S.C. § 1182(a). Stowaways are expressly
included in the category of "excludable" aliens. 8 U.S.C.
§1182(a)(6)(D).
In addition to being excludable aliens, stowaways are
generally viewed as a disfavored category. E.g., Yiu Sing Chun
v. Sava, 708 F.2d 869, 875 n.21 (2d Cir. 1983). One consequence
of this is that, in contrast to other excludable aliens,
stowaways are automatically subject to deportation and have no
right to a hearing to determine their status. The INA provides:
The provisions of section 1225 of this title
for detention of aliens for examination
before special inquiry officers and the right
of appeal provided for in section 1226 of
this title shall not apply to aliens who
arrive as stowaways and no such alien shall
be permitted to land in the United States,
except temporarily for medical treatment, or
pursuant to such regulations as the Attorney
General may prescribe for the ultimate
departure or removal or deportation of such
alien from the United States.
8 U.S.C. § 1323(d). Under this provision stowaways who do not
seek political asylum are subject to immediate deportation, and
under 8 U.S.C. § 1227(a)(1) the carriers on whose vessel or plane
they arrived are responsible for returning them to the place from
whence they came, as well as for the costs of any detention for
the period between the issuance of the deportation/exclusion
order and the actual departure of the stowaways.
9
This case presents us with the question of whether and
to what extent INS may place on carriers the additional burden of
detaining and maintaining asylum-seeking stowaways during the
period in which their asylum applications are pending. The
statutory scheme by its express terms only contemplates placing
on carriers the cost of detaining stowaways who are subject to
immediate deportation. Asylum seekers cannot, however, be
deported pending a decision on their asylum application, 8 U.S.C.
§ 1105a. A fortiori an asylum-seeking stowaway is not subject to
"immediate deportation" while the asylum application is under
consideration. Yet the INS has taken the position that it has
the authority to parole stowaways who have applied for asylum
into the custody of carriers, 8 C.F.R. § 253.1(f)(3), and that
carriers may be held liable for the costs of detention and
related services during this period. See Legal Opinion of INS
Acting General Counsel (January 11, 1991). Moreover, as noted
above, INS apparently reserves the right to impose whatever
conditions on detention it deems appropriate. Of these three
rules, only the first, 8 C.F.R. § 253.1(f)(3), was adopted
pursuant to the notice and comment provisions of the APA.
Prior to 1986, INS made carriers responsible for the
detention of all excludable aliens, arriving on their planes or
vessels, as well as for related costs. See 8 C.F.R. §§ 233.1,
235.3 (1986). In imposing this requirement, INS relied on the
provisions of 8 U.S.C. § 1223. That section provided in part:
Whenever a temporary removal of aliens is
made under this section, the vessels or
aircraft or transportation lines which
10
brought them, and the masters, commanding
officers, owners, agents, and consignees of
the vessel, aircraft, or transportation line
upon which they arrived shall pay all
expenses of such removal to a designated
place for examination and inspection or other
place of detention and all expenses arising
during subsequent detention, pending a
decision on the aliens' eligibility to enter
the United States and until they are either
allowed to land or returned to the care of
the transportation line or to the vessel or
aircraft which brought them.
8 U.S.C. § 1223 (repealed Oct. 18, 1986, 100 Stat. 1783-56).
Congress began to express concern about this state of
affairs as early as 1985. In that year the House Appropriations
Committee noted its apprehension
about the policy of the Immigration and
Naturalization Service which requires
scheduled passenger airlines to assume
custody and financial responsibility for
aliens who arrive by plane in the United
States without proper documentation. The
Committee understands that in the absence of
Government detention facilities, air carriers
must detain such aliens in custody and in all
cases pay for their food and shelter. The
Committee believes this policy raises
significant questions about the equity and
legal propriety of requiring private entities
to assume the financial burdens of
maintaining and, at times, exercising
physical custody over excluded aliens for
extended periods of time. Specifically, the
Committee is concerned about the possible
ramifications of detention of aliens by
airline personnel or their agents who are
not, of course, law enforcement officials.
H.R. Rep. No. 197, 99th Cong., 1st Sess., at 38 (1985).
Accordingly, the Committee requested that the INS Commissioner
submit a report concerning the policy, which was to include a
discussion of
11
the effect of a change in policy which would
require the Immigration and Naturalization
Service to assume all custodial
responsibility when the transporting air
carrier has demonstrated a good faith effort
to detect inadmissibility prior to boarding.
Id.
The Committee reiterated these concerns the following
year. It expressed
strong support for a change in policy which
would require the INS to assume, in all
cases, all custodial responsibility and
financial responsibility when the
transporting air carriers have demonstrated a
good faith effort to detect inadmissibility
prior to boarding the aircraft.
H.R. Rep. No. 669, 99th Cong., 2d Sess., at 35 (1986).
In 1986, Congress repealed § 1223 and enacted the User
Fee Statute. Consistent with the congressional concerns outlined
above, one of the new statute's primary functions was to reverse
the existing rule, requiring carriers to bear the expenses of
detaining aliens pending hearings on their immigration status.
The Conference Report, accompanying the bill, described the
relevant provision as follows:
Provides language proposed by the Senate
which would release scheduled passenger
airlines and vessels from the responsibility
to assume custody or financial responsibility
for aliens who arrive by plane or commercial
vessel in the U.S. without proper
documentation. The House bill contained no
provision on this matter.
H.R. Rep. No. 1005, 99th Cong., 2d Sess., at 421 (1986). The
statute created a User Fee Account, financed by a five dollar
surcharge on the tickets of international passengers and by civil
fines collected by INS. The money from the account is to be used
12
to refund the Attorney General "for expenses incurred by the
Attorney General in ... providing detention and deportation
services for excludable aliens arriving on commercial aircraft
and vessels." 8 U.S.C. § 1356(h)(2)(A)(v) (emphasis added).
Neither the statute nor its legislative history suggest any
distinctions between the various categories of "excludable"
aliens for purposes of this reallocation of the burdens of
detention.
As noted above, INS has promulgated a rule, pursuant to
notice and comment, in which, despite the User Fee Statute, it
has interpreted the INA to authorize it, as one option, to parole
stowaways who have requested asylum into the custody of the
carrier. "Pending adjudication of the application by the Asylum
Officer, the applicant may be detained by the [INS], or paroled
into the custody of the ship's agent or otherwise paroled in
accordance with § 212.5 of this chapter ... ." 8 C.F.R.
§253.1(f)(3). As the following discussion of the statute will
reveal, this is a permissible reading of the INA to which we must
defer under the doctrine of Chevron, U.S.A., Inc. v. Natural
Resources Defense Council, Inc., 467 U.S. 837, 104 S. Ct. 2778, 81
L. Ed. 2d 694 (1984). Thus we are concerned here only with the
question of responsibility for the costs of detention and its
incidents4 and the related issue of the lack of any standards
governing detention by carriers.
4
The question of who bears responsibility for the costs of
detention is distinct from the question of who is responsible for
taking custody of stowaways. For example, on at least two
occasions INS has taken stowaways into its custody without
13
Dia argues that, under the User Fee Statute, INS is
required to pay for the detention expenses of stowaways who
request asylum. It relies primarily on the fact that stowaways
are expressly defined as "excludable" aliens in § 1182(a)(6)(D),
as well as the User Fee Statute's unqualified reference to the
Attorney General's bearing the costs of detention of excludable
aliens. In support of this reading it points to the similarly
unqualified language of the legislative history, which also
suggests that Congress did not intend to distinguish between
stowaways and other excludable aliens in shifting the costs of
detention to INS. Dia acknowledges that stowaways who do not
request asylum are subject to immediate deportation under
§1323(d) and that under § 1227(a)(1) carriers are responsible for
the costs of their deportation (including detention incident to
deportation) but contends that because those that seek asylum are
entitled to a hearing on that request INS should pay detention
costs while the hearing is pending.
The government argues, and the district court found,
that § 1323(d) makes stowaways a de facto class of "excluded"
aliens. Although there is no explicit statutory basis for this
categorization, the district court began its analysis by
observing that stowaways are subject to immediate deportation
with no hearing. It then looked to the language of § 1227(a)(1),
which provides that "[a]ny alien ... arriving in the United
relieving carriers from liability for the expense of doing so.
See Legal Opinion of INS Acting General Counsel at 2 n.1, 6
(January 11, 1991). And in this case Dia argues that INS should
reimburse it for the costs incurred in detaining the stowaways.
14
States who is excluded under this chapter, shall be immediately
deported ... unless the Attorney General, in an individual case,
in his discretion, concludes that immediate deportation is not
practicable or proper." From this analysis, the district court
understood "excluded" as "a de facto category of aliens termed
'excluded' aliens, meaning those aliens defined as excludable
pursuant to 8 U.S.C. § 1182(1) and subject to immediate exclusion
and deportation." Dia Navigation Co., Ltd. v. Reno, 831 F.Supp
360, 367 (D.N.J. 1993). Under the district court's reading of
the statute, once it is conclusively determined that a particular
alien is a stowaway, because stowaways are not entitled to an
exclusion hearing, the stowaway becomes a member of a class of
"excludable" aliens and is therefore "excluded," having become
subject to immediate exclusion and deportation. Id. If asylum
is not granted, "the stowaway is again able to be deported." Id.
at 371.
Aliens who apply for asylum, however, cannot be
deported until their applications have been processed and denied.
8 U.S.C. § 1105a. The district court concluded that asylum-
seeking stowaways still fell within the reach of § 1227(a)(1)
because of that section's provision relating to aliens whose
deportation has been stayed at the discretion of the Attorney
General. Under that reading of the statute, in an instance when
the Attorney General exercises her discretion and determines that
"immediate deportation is not practicable or proper":
[t]he cost of the maintenance including
detention expenses and expenses incident to
detention of any such alien while he is being
15
detained shall be borne by the owner or
owners of the vessel or aircraft on which he
arrived ... .
8 U.S.C. § 1227(a)(1).
Dia's response to this interpretation is that the
deportation of stowaways who apply for asylum cannot be
characterized as having been stayed at the discretion of the
Attorney General. Instead, 8 U.S.C. § 1105a requires that
deportation be stayed for all asylum applicants. Dia's reading
seems correct, and it reveals a fundamental tension in the
statutory framework. Sections 1227(a)(1) and 1323(d) require
that stowaways be deported immediately unless the Attorney
General in the exercise of her discretion determines otherwise,
and § 1227(a)(1) places the burden of deportation, and any
detention incident to deportation, on the carrier. Section
1105a, however, provides that asylum applicants may not be
deported until their applications have been processed, and this
is not a matter of discretion. The statute nowhere addresses the
question presented here -- the status of an asylum applicant,
otherwise excluded, pending the processing of the asylum
application.
Presumably the logic of the INS's position is that
carriers are responsible for the detention of aliens once they
become "excluded" without regard to what might happen after that
point. However, this attempt to reconcile these statutes suffers
from several flaws. As noted above, the language of § 1227(a)(1)
seems to contemplate placing stowaways in the custody of carriers
only for the short period between the issuance of their
16
deportation orders and their immediate deportation; its
provisions do not encompass situations other than those in which
deportation is to be "immediate" or more specifically the
detention of stowaways who apply for asylum. The INS's reading
of the statute also creates tension with INS regulations.
Specifically, 8 C.F.R. § 253.1(f)(3) indicates that a stowaway
"shall not be excluded or deported before a decision is rendered
by the Asylum Officer on his asylum application." Furthermore,
the backdrop for the present statutory scheme is the repeal of
§1223, which clearly did place the burden of paying for detention
on carriers, and a legislative history strongly evincing
congressional desire to place responsibility for detention on
INS. Yet INS relies on § 1227(a)(1), the "immediate deportation"
provisions, as authority for placing the financial burden of
detention in asylum-seeking stowaway cases on the carrier. See
Legal Opinion of INS Acting General Counsel (January 11, 1991).
Turning from the statutory language to the regulations
we find a similar lack of clear answers. In response to the User
Fee Act, INS adopted, pursuant to notice and comment, a rule that
"addresses the change from carrier responsibility to INS
responsibility for the custody and detention of excludable
aliens." 53 Fed. Reg. 1791 (1988) (proposed rule). See also 54
Fed. Reg. 100 (1989) (final rule) (characterizing the rule with
substantially the same language). Aside from reiterating what
the statutes make clear--that "[c]arriers become liable for
detention and transportation expenses immediately upon the
issuance of a deportation/exclusion order," 54 Fed. Reg. at 100--
17
the rule does not address the situation with which we are
currently faced. Indeed, in response to commenters' concerns
about detention conditions INS noted that the rule "does not
address details of specific alien detention conditions. The
conditions under which aliens are held would be a matter for
other proceedings." Id. at 101.5
Dia points to a number of other regulatory provisions
in support of its contention that the INS policy in this case
contravenes INS regulations. Dia directs our attention to 8
C.F.R. §§ 235.3(e) and 237, both of which indicate that
"excluded" aliens are to be delivered to the appropriate carrier,
which becomes responsible for the costs of detention from that
point.6 In stating that rule, however, the regulation, like 8
U.S.C. § 1227(a)(1), does not provide an answer to the question
5
The rule did set forth minimum criteria for INS detention at
non-INS facilities. Id.; 8 C.F.R. § 235.3(f). As counsel
agreed, however, those criteria do not apply to detention by
carriers.
6
Section 235.3(e) states:
[If i]n the opinion of the examining
immigration officer, it is not practical to
resolve a question of admissibility at the
time of arrival of an alien passenger on a
vessel or aircraft, the officer shall execute
a Form I-259C to notify the agent, master, or
commanding officer of the vessel or aircraft,
if applicable, that the alien passenger may
be excludable from the United States and in
the event the alien is formally ordered
excluded and deported, the carrier will be
responsible for detention and transportation
expenses to the last foreign port of
embarkation as provided in § 237.5 of this
chapter.
8 C.F.R. § 235.3(e).
18
of whether carriers are responsible for the costs of detention
pending the processing of an asylum application.
Dia further argues that under 8 C.F.R. § 235.3(d) the
INS is responsible for the cost of detaining all aliens, except
"Transit Without Visa" passengers. The relevant provisions are
as follows:
(b) Aliens with no documentation or false
documentation. Any alien who appears to the
inspecting officer to be inadmissible, and
who arrives without documents ... or who
arrives with documentation which appears on
its face to be false, altered, or to relate
to another person, or who arrives at a place
other than a designated port of entry, shall
be detained in accordance with section 235(b)
[8 U.S.C. § 1225(b)] of the Act. ...
(c) Aliens with documents. Any alien who
appears to the inspecting officer to be
inadmissible, but who does not fall within
paragraph (b) of this section, may be
detained, paroled, or paroled for deferred
inspection by the inspecting officer. ...
(d) Service custody. The Service will assume
custody of any alien subject to detention
under § 235.3 (b) or (c) of this section,
except in the case of an alien who is
presented as a Transit Without Visa (TWOV)
passenger.
8 C.F.R. § 235.3.
Dia points out that this section divides aliens into
only two categories--those with documents and those without--and
argues that stowaways clearly will be either one or the other.
Thus, because the reference in subsection (d) is to "any alien,"
Dia contends that INS is violating its own regulations by not
taking custody of stowaways who seek asylum.
19
The government's response to this argument is that the
statutory provision the rule implements concerns only the
detention of those aliens "who may not appear to the examining
immigration officer at the port of arrival to be clearly and
beyond a doubt entitled to land [and] shall be detained for
further inquiry to be conducted by a special inquiry officer." 8
U.S.C. § 1225(b). In contrast to such aliens, stowaways are
clearly not entitled to land. 8 U.S.C. § 1323(d). As such, they
are not within the ambit of § 1225(b) or 8 C.F.R. § 235.3(b), and
thus 8 C.F.R. § 235.3(d) does not apply. In addition, we note
that the regulation by its terms concerns only responsibility for
the custody of aliens. As we have explained above, the question
of custody is distinct from that of financial responsibility and
is already addressed by the regulations.
The inescapable conclusion of our analysis is that no
clear answer emerges from the statutes and regulations. Congress
clearly wished to shift the bulk of financial responsibility for
detention to INS, but neither the statute nor the legislative
history provide an indication of whether it wished to shift that
burden with respect to stowaways who apply for asylum. The
question, quite simply, was not answered. Similarly, the
regulations evince no consideration of the issue except to the
extent that INS has reserved the right to force carriers to take
custody of such aliens. Moreover, neither the statutes nor the
regulations address the conditions in which aliens are to be
detained. Indeed, the INS at oral argument before us conceded
that, even though the INS considers § 1227(a)(1) to make more
20
sense when read the government's way, i.e., holding the carrier
responsible for detention, there's no need to read it that way.
In light then of the statutory and regulatory language and of the
INS's concession, we must determine whether INS's position
regarding carrier responsibility was legitimately adopted.
III.
The APA defines "rule" broadly to include:
the whole or a part of an agency statement of
general or particular applicability and
future effect designed to implement,
interpret, or prescribe law or policy or
describing the organization, procedure, or
practice requirements of an agency and
includes the approval or prescription for the
future of rates, wages, corporate or
financial structures or reorganizations
thereof, prices, facilities, appliances,
services or allowances therefor or of
valuations, costs, or accounting, or
practices bearing on any of the foregoing.
5 U.S.C. § 551(4). In light of this broad definition we think it
plain that the INS policies at issue in this case constitute
rules for purposes of the APA.
Under the APA,
[g]eneral notice of proposed rulemaking shall
be published in the Federal Register, unless
persons subject thereto are named and either
personally served or otherwise have actual
notice thereof in accordance with the law.
... Except when notice or hearing is
required by statute, this subsection does not
apply--
(A) to interpretative
rules, general statements of
policy, or rules of agency
organization, procedure, or
practice ... .
5 U.S.C. § 553(b). When an agency is required to give notice, it
must then consider the comments of interested parties upon the
21
proposed rule, 5 U.S.C. § 553(c), and publish the final rule
within thirty days of its effective date. 5 U.S.C. § 553(d).
The distinction between "substantive" or "legislative"
rules and "interpretive" or "interpretative" rules has proven to
be one incapable of being drawn with much analytical precision.
Indeed, courts customarily begin recitations of the law on the
subject with remarks such as the distinction is "fuzzy," National
Family Planning and Reproductive Health Ass'n v. Sullivan, 979
F.2d 227, 231 (D.C. Cir. 1992); "'enshrouded in considerable
smog,'" La Casa Del Convaleciente v. Sullivan, 965 F.2d 1175,
1177 (1st Cir. 1992) (quoting General Motors Corp. v.
Ruckelshaus, 742 F.2d 1561, 1565 (D.C. Cir. 1984)); or "'far from
crystal clear.'" Metropolitan Sch. Dist. v. Davila, 969 F.2d
485, 489 (7th Cir. 1992) (quoting Chemical Waste Management, Inc.
v. EPA, 869 F.2d 1526, 1534 (D.C. Cir. 1989)), cert. denied, 113
S. Ct. 1360, 122 L. Ed. 2d 740 (1993). And the cases live up to
this billing, setting forth tests that are often circular and
usually somewhat Delphic. Nevertheless, certain principles
emerge, and, while we are not able to capture their essence any
more succinctly than our predecessors, we believe their
application in this case is clear.
Our most recent statement of the law on this question
appeared in FLRA v. Department of the Navy, 966 F.2d 747 (3d Cir.
1992)(in banc). The critical difference between legislative and
interpretative rules, we noted, is that the former "have the
force and effect of law" while the latter do not. Id. at 762
n.14. Stated differently, legislative rules have "substantive
22
legal effect," while interpretative rules typically involve
construction or clarification of a statute or regulation. Id.
See also Bailey v. Sullivan, 885 F.2d 52, 62 (3d Cir. 1989);
United States v. Walter Dunlap & Sons, Inc., 800 F.2d 1232, 1238
(3d Cir. 1986). "If a rule creates rights, assigns duties, or
imposes obligations, the basic tenor of which is not already
outlined in the law itself, then it is substantive." La Casa Del
Convaleciente, 965 F.2d at 1178. Put yet another way,
what distinguishes interpretative from
legislative rules is the legal base upon
which the rule rests. If the rule is based
on specific statutory provisions, and its
validity stands or falls on the correctness
of the agency's interpretation of those
provisions, it is an interpretative rule. If,
however, the rule is based on an agency's
power to exercise its judgment as to how best
to implement a general statutory mandate, the
rule is likely a legislative one.
United Technologies Corp. v. EPA, 821 F.2d 714, 719-20 (D.C. Cir.
1987).
Of course as applied to many rules, such statements are
apt to amount to conclusions about the rule rather than
principled bases on which to categorize them. Thus courts have
inquired into the agency's perception of the rule. This inquiry
concerns first the agency's characterization of the rule as
legislative or interpretative. See, e.g., Davila, 969 F.2d at
489; United Technologies, 821 F.2d at 718; Levesque v. Block, 723
F.2d 175, 182 (1st Cir. 1983); Cerro Metal Prods. v. Marshall,
620 F.2d 964, 981 (3d Cir. 1980). The more basic determination,
however, involves whether "'if by its action the agency intends
to create new law, rights or duties.'" United Technologies, 821
23
F.2d at 718 (quoting General Motors Corp. v. Ruckelshaus, 742
F.2d 1561, 1565 (D.C. Cir. 1984) (en banc), cert. denied, 471
U.S. 1074 (1985)). See also Daughters of Miriam Center for the
Aged v. Mathews, 590 F.2d 1250, 1255 n.9 (3d Cir. 1978). Courts
have also looked more broadly to "the impact that a given rule
has on those to whom the rule applies." Ohio Dep't of Human
Servs. v. HHS, 862 F.2d 1228, 1233 (6th Cir. 1988). While the
substantial impact of a rule is relevant to its classification,
however, such an impact will not, without more, compel a finding
that a rule is legislative. Davila, 969 F.2d at 493; La Casa Del
Convaleciente, 965 F.2d at 1178.
Recognizing that even consideration of all these
factors will not always lead to a clear determination, we noted
in FLRA v. Department of the Navy that it is often helpful to
analyze a rule with an eye to the policies animating the APA's
notice and comment requirement. FLRA v. Navy, 966 F.2d at 762
n.14 (citing Batterton v. Marshall, 648 F.2d 694, 705 (D.C. Cir.
1980)). As the D.C. Circuit noted in Batterton: "Analysis that
improves upon semantic play must focus on the underlying purposes
of the procedural requirements at issue. The essential purpose
of according § 553 notice and comment opportunities is to
reintroduce public participation and fairness to affected parties
after governmental authority has been delegated to
unrepresentative agencies." 648 F.2d at 703. See also Morton v.
Ruiz, 415 U.S. 199, 232, 94 S. Ct. 1055, 1073 (1974) ("The
Administrative Procedure Act was adopted to provide, inter alia,
that administrative policies affecting individual rights and
24
obligations be promulgated pursuant to certain stated procedures
so as to avoid the inherently arbitrary nature of unpublished ad
hoc determinations.").
Consideration of these factors in the context of this
case leads us to the conclusion that the INS rules here are
legislative in nature. As our analysis in the preceding section
reveals, the statute simply does not set out a standard
concerning liability for the costs of detention in cases such as
this. Any attempt to divine an answer leads only to the
conclusion that there is tension if not outright inconsistency
within the INA to the extent that it can be read as addressing
the question. Moreover, there is no suggestion that the statute
speaks at all to the conditions of detention. Yet, in the face
of what is at best statutory ambiguity, INS has adopted rules
holding carriers liable for unlimited costs of detention and
imposing custody with no guidelines, or subject only to standards
as determined by an INS officer on the scene. This is no less a
legislative decision than would be the adoption of a detailed
code concerning the limits and conditions of detention.
Our conclusion squares with those of other courts
confronted with agency implementation of statutes that do not
address the agency action at issue. "In the present case,
'interpretation' could only go so far as to spot the dilemma
posed by the statutory inconsistency, while legislative-type
action was required to carry the agency the rest of the way ...
." Citizens to Save Spencer County v. EPA, 600 F.2d 844, 879
(D.C. Cir. 1979). See also National Family Planning, 979 F.2d at
25
237 (noting that filling in gaps and resolving inconsistencies in
statutory scheme involves legislative rulemaking); Chamber of
Commerce v. OSHA, 636 F.2d 464, 469 (D.C. Cir. 1980) ("It is
clear to us that the [agency] has attempted through this
regulation to supplement the [statute], not simply to construe
it, and therefore the regulation must be treated as a legislative
rule."). The INS has stretched the limits of the INA, without
the benefit of input from the affected parties, and now contends
that these parties are without power to challenge its actions.
This plainly amounts to legislative rulemaking.
Our conviction is only strengthened when we consider
the impact of the INS's rules. In this case Dia was forced to
spend a considerable sum of money detaining the four stowaways
under armed guard in a commercial hotel for 54 days--a period
which appears to be considerably shorter than is normally needed
to process asylum applications. Dia also had to assist the
stowaways in the preparation of their applications, which
included hiring an interpreter. Perhaps most significantly, Dia
was forced to deal with a suicidal stowaway on a hunger strike,
with the resulting use of leg irons. This was certainly a less-
than-ideal situation for both Dia and the stowaway, and perhaps
for the other guests at the Holiday Inn, but the INS refused to
assume custody. Episodes such as this appear to be what
motivated Congress to enact the User Fee Statute and require the
INS to take custody of aliens.
In sum, we hold that, if the INS wishes to impose on
private carriers the costs of detaining stowaways who have
26
applied for asylum, it must do so pursuant to the notice and
comment requirements of the APA. Moreover, because the decision
to impose custody and/or the costs of detention on carriers
necessarily involves some decision as to the extent and
conditions of these obligations, the INS must adopt its rules,
governing these issues and setting forth how questions concerning
the extent and conditions of detention will be answered, pursuant
to notice and comment.
Because the INS has not conformed with the requirements
of the APA in establishing its policy on the costs and conditions
of detention of asylum-seeking stowaways pending a decision on
the asylum application, the district court erred in failing to
grant that portion of Dia's motion for a declaratory judgment to
that effect.
IV.
We now turn briefly to Dia's claims for reimbursement
of its expenses in detaining the stowaways. Dia argues that it
is entitled to reimbursement under the APA and under the Tucker
Act. We believe the district court correctly concluded that Dia
may not recover its expenses under either of these statutes.
A. The APA
Dia first claims that it is entitled to reimbursement
under § 702 of the APA. That section provides in part:
A person suffering legal wrong because
of agency action, or adversely affected or
aggrieved by agency action within the meaning
of a relevant statute, is entitled to
judicial review thereof. An action in a
court of the United States seeking relief
other than money damages and stating a claim
27
that an agency or an officer or employee
thereof acted or failed to act in an official
capacity or under color of legal authority
shall not be dismissed nor relief therein be
denied on the ground that it is against the
United States or that the United States is an
indispensable party.
5 U.S.C. § 702 (emphasis added). The district court found that
the relief Dia seeks qualifies as money damages for purposes of
this section, Dia, 831 F. Supp. at 378-80, and that as a result
recovery is barred by the doctrine of sovereign immunity. Id.
The government urges us to adopt this analysis.
In Bowen v. Massachusetts, 487 U.S. 879, 108 S. Ct.
2722, 101 L. Ed. 2d 749 (1988), the Supreme Court noted that "[t]he
fact that a judicial remedy may require one party to pay money to
another is not a sufficient reason to characterize the relief as
'money damages.'" Id. at 893, 108 S.Ct. at 2732. In Bowen the
state of Massachusetts sued the Secretary of Health and Human
Services to enforce a provision of the Medicaid Act which
required payment of certain amounts to the state for Medicaid
services. The Court noted that Massachusetts' suit
is not a suit seeking money in compensation
for the damage sustained by the failure of
the Federal Government to pay as mandated;
rather, it is a suit seeking to enforce the
statutory mandate itself, which happens to be
one for the payment of money. The fact that
the mandate is one for the payment of money
must not be confused with the question
whether such payment, in these circumstances,
is a payment of money as damages or as
specific relief.
Id. at 900-01, 108 S.Ct. at 2735. The Court concluded that
"since the [district court's] orders are for specific relief
(they undo the Secretary's refusal to reimburse the State) rather
28
than for money damages (they do not provide relief that
substitutes for that which ought to have been done) they are
within the District Court's jurisdiction under § 702's waiver of
sovereign immunity." Id. at 910, 108 S.Ct. at 2740.
Following the Supreme Court's lead, this court has
similarly determined that a monetary award can in some instances
constitute equitable relief rather than money damages for
purposes of § 702. See Zellous v. Broadhead Assocs., 906 F.2d 94
(3d Cir. 1990). Other courts have reached the same conclusion.
See, e.g., Esch v. Yeutter, 876 F.2d 976, 984 (D.C.Cir. 1989);
Beverly Hospital v. Bowen, 872 F.2d 483, 487 (D.C.Cir. 1989). As
the district court concluded, "all of these cases have concerned
some form of statutory entitlement to monetary relief." Dia, 831
F. Supp. at 378. The crucial distinction involves whether a
claimant "'is seeking funds to which a statute allegedly entitles
it, rather than money for the losses ... suffered by virtue of'"
the agency's failure to do that which it was required to do.
Bowen, 487 U.S. at 901, 108 S.Ct. at 2735 (quoting Maryland Dept.
of Human Resources v. Department of Health and Human Services,
763 F.2d 1441, 1446 (D.C.Cir. 1985)).
In this case the reimbursement Dia seeks falls squarely
within the category of "money damages" as prior case law has
defined that term. The INA simply does not speak to the question
of responsibility for the costs of detention of stowaways who
apply for asylum. Thus there is no statutory entitlement to
these funds. Instead, Congress has explicitly given the INS the
authority to promulgate regulations as it deems necessary in
29
implementing the INA. 8 U.S.C. § 1103. The entitlement to these
costs, then, must originate from INS rather than from a court
that lacks the requisite expertise and information to craft an
appropriate standard. Indeed, were we to fashion a rule out of
Congress' silence simply because Dia has alleged a statutory
entitlement we would not only be usurping the role of the agency
but also inviting parties to use § 702 to circumvent
administrative agencies in favor of the courts. We cannot allow
the identity of the decisionmaker to be determined by crafty
lawyering. Cf. Bowen, 487 U.S. at 915-16, 108 S.Ct. at 2743
(Scalia, J., dissenting).
As we view this case, the wrong that Dia has suffered
is not the denial of money to which the INA entitles it, but
rather the INS' failure to follow the appropriate procedures in
implementing the INA. An award of money in these circumstances
could only be characterized as a substitute for what ought to
have been done, and therefore would constitute money damages. As
such, Dia's claim is barred by the doctrine of sovereign
immunity.
B. The Tucker Act
The district court dismissed Dia's Tucker Act claim on
the ground that it lacks substantive merit. Dia, 831 F. Supp. at
380 n.40. We conclude that the district court correctly
dismissed this claim, though we do not reach the merits of the
claim because we hold that the district court lacked jurisdiction
over it.
As our prior cases make clear:
30
Under the Tucker Act, the United States
Claims Court and district courts share
original jurisdiction over non-tort monetary
claims against the United States not
exceeding $10,000. 28 U.S.C. § 1346(a)(2)
(sometimes referred to as the "Little Tucker
Act"). Original jurisdiction over such
claims seeking more than $10,000 vests
exclusively in the Claims Court. 28 U.S.C.
§1491 (the so-called "Big Tucker Act").
Chabal v. Reagan, 822 F.2d 349, 353 (3d Cir. 1987). See also
United States v. Hohri, 482 U.S. 64, 67 n.1, 107 S. Ct. 2246, 2249
n.1, 96 L. Ed. 2d 51 (1987); Livera v. First Nat'l State Bank of
N.J., 879 F.2d 1186, 1195 (3d Cir.), cert. denied sub nom. Livera
v. Small Business Admin., 493 U.S. 937, 110 S. Ct. 332, 107
L. Ed. 2d 322 (1989); Hahn v. United States, 757 F.2d 581, 585-86
(3d Cir. 1985).
Dia asserts that the Claims Court's exclusive
jurisdiction is overridden by the Supplemental Jurisdiction Act.
28 U.S.C. § 1367. We reject this argument in light of the Tucker
Act's explicit jurisdictional bar. See Pershing Div. of
Donaldson, Lufkin & Jenrette Secs. Corp. v. United States, --F.3d
---, 1994 WL 153956, *1-2 (7th Cir. 1994). Dia has alleged
damages amounting to $127,580, far in excess of the maximum claim
over which the district court could exercise its jurisdiction.
The district court therefore properly dismissed this claim.
V.
For the foregoing reasons, we will reverse the district
court's order, dismissing Dia's complaint, and we will remand
this case to the district court to award a declaratory judgment
in favor of Dia on its claim that the INS policy on the costs and
31
conditions of detention of asylum-seeking stowaways is invalid
for failure to comply with the notice and comment procedures of
the APA. We will affirm the order of the district court insofar
as it dismissed Dia's other claims, including its claim for
monetary relief.
32