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Alaska Oil and Gas Ass'n v. Salazar

United States District Court, D. Alaska

January 11, 2013

ALASKA OIL AND GAS ASSOCIATION, et al., Plaintiffs,
v.
Kenneth L. SALAZAR, et al., Defendants. State of Alaska, Plaintiff,
v.
Kenneth L. Salazar, et al., Defendants. Arctic Slope Regional Corporation, et al., Plaintiffs,
v.
Kenneth L. Salazar, et al., Defendants.

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Jeffrey W. Leppo, Ryan P. Steen, Stoel Rives LLP, Matthew A. Love, Tyson C. Kade, Van Ness Feldman, P.C., Seattle, WA, Bradley Edward Meyen, State of Alaska, Office of the Attorney General, Jeffrey M. Feldman, Kevin M. Cuddy, Feldman Orlansky & Sanders, Anchorage, AK, Murray Dov Feldman, Holland & Hart LLP, Boise, ID, Emma K. Pokon, North Slope Borough Law Department, Barrow, AK, for Plaintiffs.

Clifford E. Stevens, Jr., Meredith Lisa Flax, U.S. Department of Justice, Washington, DC, for Defendants.

Order Granting Plaintiffs' Motions For Summary Judgment

RALPH R. BEISTLINE, District Judge.

I. INTRODUCTION

Before the Court are Plaintiffs Alaska Oil and Gas Association, the American Petroleum Institute, Arctic Slope Regional Corporation, the North Slope Borough,

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NANA Regional Corporation, Inc., Bering Straits Native Corporation, Calista Corporation, Tikigaq Corporation, Olgoonik Corporation, Inc., Ukpeagvik Inupiat Corporation, Kuukpik Corporation, Cully Corporation, Kaktovik, Inupiat Corporation, the Inupiat Community of the Arctic Slope, and State of Alaska with three motions for summary judgment, at Docket Numbers 50, 55, and 57, challenging the United States Department of the Interior, Fish and Wildlife Service's (" Service" ) final rule designating critical habitat for the polar bear (" Final Rule" ) under the Endangered Species Act (" ESA" ). As the present litigation involves three separate but closely related summary judgment motions from three partially consolidated cases, the Court will treat all three motions as a single motion.

Plaintiffs contend that the Service proceeded with an unprecedented critical habitat designation despite the Service's finding that such designation " will not result in any present or anticipated future conservation benefit to the polar bear species " and is not " ‘ essential’ to the conservation of the species." [1] Plaintiffs further opine that: (1) such designation will " have significant adverse ramifications for the people who live and work on the North Slope, for Alaska's oil and gas industry, and for the State of Alaska" ; [2] (2) the designation will " leave the species worse off because it is impairing the cooperative relationship that the ... [Service] has sought to build with the Alaska Natives" ; [3] (3) the Service's failure to exclude " native-owned lands and rural communities" will " disproportionately harm Alaska Natives and other North Slope Borough residents" ; [4] (4) the Service failed " to engage in meaningful consultation with [the State of Alaska and with] Alaska Natives early in the rulemaking process" ; [5] (5) the Service's inclusion of " a one-mile no disturbance zone as part of the barrier island habitat unit of the designation ... exceeds its authority under the ESA" ; [6] (6) " [t]he Service failed to adequately consider and include in the calculation of the total economic impacts of the designation the substantial indirect incremental economic impacts" ; [7] (7) " [t]he Service failed to provide Alaska with an adequate written justification as required by the ESA ... for promulgating a ... designation that conflicts with the comments submitted to the" Service; [8] (8) the Service failed to address the area exclusion requests by Alaska " and failed to adequately consider whether the benefits of excluding those areas were outweighed by the benefits of including them" ; [9] (9) " [t]he Service improperly included areas that it concedes were not occupied by polar bears at the time of the designation" ; [10] and (10) " [t]he Service improperly included areas as critical habitat without determining that those areas contained the physical or biological features essential to the conservation of the polar bear." [11] Plaintiffs seek the invalidation of the Final Rule and request that the Court vacate and remand the Rule.

Defendants Kenneth L. Salazar, Secretary of the Interior, Rowan W. Gould,

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Acting Director of the Service, and the Service (collectively, " Government" ) and Defendant-Intervenors Center for Biological Diversity, Defenders of Wildlife, Inc., and Greenpeace, Inc. (collectively, " Intervenors" ) oppose and cross-move for summary judgment at Docket Numbers 64 and 68 respectively.[12] The Government argues that Plaintiffs insert requirements into the ESA that simply do not appear in the Act, ignore or disagree with much of the case law that interprets the critical habitat provisions of the ESA, and ask the Court to review technical and scientific matters that Congress explicitly left to the discretion and expertise of the Service.[13] The Government further claims that the designation " provides many important conservation benefits for the species...." [14] Additionally, the Government contends that because the polar bear and its habitat are highly threatened by climate change, the designation of critical habitat for the species can help mitigate any further habitat degradation. [15] Intervenors agree with the Government and state that the Final Rule " complies with the letter and intent of the ESA." [16]

Inasmuch as the Court concludes that the Final Rule, while valid in many respects, falls short of the APA's arbitrary and capricious standard and because the Service failed to follow the procedural requirements of the ESA, the Court vacates the Final Rule and remands it to the Service.

II. FACTS

These partially consolidated cases present Plaintiffs' collective challenges to the Service's ESA rulemaking designation of critical habitat for the polar bear. The cases are subject to administrative record review under the Administrative Procedure Act (" APA" ).[17] There are no contested issues of fact, and all parties agree that the cases will be decided by summary judgment based on the administrative record.[18]

III. STANDARD OF REVIEW

A. Summary Judgment

Rule 56 of the Federal Rules of Civil Procedure provides that summary judgment should be granted if there is no genuine dispute as to material facts and if the moving party is entitled to judgment as a matter of law. All evidence presented by the non-movant must be believed for purposes of summary judgment, and all justifiable inferences must be drawn in favor of the non-movant.[19] A court may grant summary judgment if the motion and supporting materials show that the movant is so entitled.[20] The sufficiency of the evidence shown must be such that a judge or jury is required " ‘ to resolve the parties' differing versions of the truth at trial’ " [21] because the facts could reasonably

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be resolved in favor of either party.[22]

B. Administrative Procedure Act

Under the APA, " final agency action for which there is no other adequate remedy in a court is subject to judicial review." [23] " [T]he reviewing court shall decide all relevant questions of law, interpret constitutional and statutory provisions, and determine the meaning or applicability of the terms of an agency action." [24] After a court has finished reviewing the action, the " court shall hold unlawful and set aside agency action, findings, and conclusions found to be arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law; ... in excess of statutory jurisdiction, authority, or limitations, or short of statutory right; [or] without observance of procedure required by law...." [25]

Judicial review of agency action is limited to those actions required by law.[26] A court cannot review agency action that Congress has left to agency discretion.[27] Once a court is " satisfied that an agency's exercise of discretion is truly informed," a court " ‘ must defer to th[at] informed discretion.’ " [28] Although an agency " cannot act on pure speculation or contrary to the evidence, the ESA accepts agency decisions in the face of uncertainty." [29] Yet, " an agency must cogently explain why it has exercised its discretion in a given manner...." [30] Additionally, even if agency decision making is discretionary, the required procedures of such decision making may not be. [31]

" Summary judgment is an appropriate mechanism for" resolving disputes over agency action.[32] " [T]he function of the district court is to determine whether or not as a matter of law the evidence in the administrative record permitted the agency to make the decision it did." [33] However, the agency is the fact finder, not the district court.[34]

When reviewing " under the arbitrary and capricious standard[,]" a court is deferential to the agency involved.[35] The agency's action is to be " presum[ed] ... valid." [36] A court should

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not vacate an agency's decision unless it ‘ has relied on factors which Congress had not intended it to consider, entirely failed to consider an important aspect of the problem, offered an explanation for its decision that runs counter to the evidence before the agency, or is so implausible that it could not be ascribed to a difference in view or the product of agency expertise.’ [37]

If an agency has not committed one of the these errors, and " ‘ a reasonable basis exists for its decision[,]’ " the action should be affirmed.[38] But, in considering whether there is a reasonable basis for the action, a " reviewing court ‘ must consider whether the decision was based on a consideration of the relevant factors and whether there has been a clear error of judgment.’ " [39] A court's consideration of agency action must be " ‘ thorough, probing, [and] in-depth....’ " [40] A reviewing court " ‘ must not rubber-stamp ... administrative decisions that [a court deems] inconsistent with a statutory mandate or that frustrate the congressional policy underlying a statute.’ " [41] An agency must have taken " a ‘ hard look’ at the potential ... impacts at issue." [42] Moreover, if the agency does not satisfactorily explain its decision, a court should not attempt itself to make up for any deficiencies: A court may not supply a reasoned basis for the agency's action that the agency itself has not given.[43] In other words, an " agency must set forth clearly the grounds on which it acted." [44] Additionally, " an agency must account for evidence in the record that may dispute the agency's findings." [45]

A court must inquire whether " the agency ... examine[d] the relevant data and articulate[d] a satisfactory explanation for its action including a ‘ rational connection between the facts found and the choice made.’ " [46] " This inquiry must ‘ be searching and careful,’ but ‘ the ultimate standard of review is a narrow one.’ " [47] " [A] court is not to substitute its judgment for that of the agency." [48] " The APA does not allow the court to overturn an agency

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decision because it disagrees with the decision or with the agency's conclusions...." [49] Rather, a court should " uphold a decision of less than ideal clarity if the agency's path may reasonably be discerned." [50] A court " is not to second guess the agency's action[, but] ... must defer to a reasonable agency action ‘ even if the administrative record contains evidence for and against its decision.’ " [51] The agency's action " ‘ need only be a reasonable, not the best or most reasonable, decision.’ " [52]

Deference to an agency's factual conclusions is important when the subject matter involves an agency's experts' complex scientific and technical opinions: " When specialists express conflicting views, an agency must have discretion to rely on the reasonable opinions of its own qualified experts even if, as an original matter, a court might find contrary views more persuasive." [53] However, " [t]he deference accorded an agency's scientific or technical expertise is not unlimited." [54] " The presumption of agency expertise can be rebutted when its decisions, while relying on scientific expertise, are not reasoned." [55] A court " defer[s] to agency expertise on methodology issues, ‘ unless the agency has completely failed to address some factor consideration of which was essential to [making an] informed decision.’ " [56]

" Unlike substantive challenges [under the arbitrary and capricious standard, a court's] review of an agency's procedural compliance is exacting, yet limited." [57] A court is limited to ensuring that statutorily prescribed procedures have been followed, including determining the adequacy of the agency's notice and comment procedure, without deferring to an agency's own opinion of the opportunities it provided.[58] Indeed, " ‘ regulations subject to the APA cannot be afforded the force and effect of law if not promulgated pursuant to the statutory procedural minimum found in that Act.’ " [59]

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IV. DISCUSSION


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