Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca9-14-15224/USCOURTS-ca9-14-15224-0/pdf.json

Nature of Suit Code: 899
Nature of Suit: Other Statutes - Administrative Procedure Act/Review or Appeal of Agency Decision
Cause of Action: 

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FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

PACIFIC DAWN LLC; JESSIE’S

ILWACO FISH COMPANY,

Plaintiffs-Appellants,

and

OCEAN GOLD SEAFOODS, INC.;

CHELLISSA LLC,

Plaintiffs,

v.

PENNY PRITZKER, Secretary of

the United States Department of

Commerce; NATIONAL OCEANIC

AND ATMOSPHERIC

ADMINISTRATION; NATIONAL

MARINE FISHERIES SERVICE,

Defendants-Appellees,

MIDWATER TRAWLERS

COOPERATIVE; TRIDENT

SEAFOODS GROUP; DULCICH,

INC., DBA Pacific Seafood

Group; ARCTIC STORM

MANAGEMENT GROUP, LLC;

ENVIRONMENTAL DEFENSE

FUND,

Intervenor-DefendantsAppellees.

No. 14-15224

D.C. No.

3:13-cv-01419-TEH

OPINION

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2 PACIFIC DAWN V. PRITZKER

Appeal from the United States District Court

for the Northern District of California

Thelton E. Henderson, Senior District Judge, Presiding

Argued and Submitted May 10, 2016

San Francisco, California

Filed August 3, 2016

Before: Sandra S. Ikuta, and Paul J. Watford, Circuit

Judges, and Derrick Kahala Watson,*

 District Judge.

Opinion by Judge Ikuta

SUMMARY**

Magnuson-Fishery Conservation and Management Act

The panel affirmed the district court’s summary judgment

in favor of the National Marine Fisheries Service and

intervenors in an action brought by a fish harvester and a fish

processor, who are subject to a fishery management program

that limits their share of the total allowable catch of Pacific

whiting, challenging a 2013 decision by the Service to

calculate the amount of their initial share based on their

* The Honorable Derrick Kahala Watson, United States District Judge

for the District of Hawaii, sitting by designation.

** This summary constitutes no part of the opinion of the court. It has

been prepared by court staff for the convenience of the reader.

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PACIFIC DAWN V. PRITZKER 3

participation in the fishery prior to 2003 and 2004,

respectively.

The panel held that the Service’s 2013 decision was not

arbitrary or capricious because the Service considered the

required factors and made a reasonable decision to use the

2003 and 2004 dates.

The panel rejected plaintiffs’ claim that the Service’s

2013 decision to select a qualifying period ending in 2003 for

harvesters and 2004 for processors was arbitrary and

capricious because it failed to take into account “present 

participation” in the fishery as required by 16 U.S.C.

§ 1853(b)(6)(A) of the Magnuson-Stevens Conservation and

Management Act. The panel held that the record makes clear

the Service considered “present participation,” but reasonably

gave it less weight than other factors.

The panel also rejected plaintiffs’ claim that the Service’s

2013 decision was arbitrary and capricious because it failed

to take into account dependence upon the fishery as required

by §§ 1853(b)(6)(B) and 1853a(c)(5)(A) of the MagnusonStevens Act.

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4 PACIFIC DAWN V. PRITZKER

COUNSEL

Tom Wyrwich (argued), Davis Wright Tremaine LLP,

Seattle, Washington; James P. Walsh and Gwen L. Fanger,

Davis Wright Tremaine LLP, San Francisco, California; for

Plaintiffs-Appellants.

Maggie B. Smith (argued) and Bridget McNeil, Attorneys;

Sam Hirsh, Acting Assistant Attorney General; Environment

and Natural Resources Division, United States Department of

Justice, Washington, D.C.; Chris McNulty, Mariam McCall,

and Ryan Couch, Office of the General Counsel, National

Oceanic & Atmospheric Administration,Seattle,Washington;

for Defendants-Appellees.

J. Timothy Hobbs (argued) and Michael F. Scanlon, K&L

Gates LLP, Seattle, Washington, for Intervenors-DefendantsAppellees Midwater Trawlers Cooperative, Trident Seafoods

Group, Dulcich, Inc., DBA Pacific Seafood Group and Arctic

Storm Management Group, LLC.

Monica Goldberg (argued), Environmental Defense Fund,

Washington, D.C., for Intervenor-Defendant-Appellee

Environmental Defense Fund.

OPINION

IKUTA, Circuit Judge:

Pacific Dawn LLC and Jessie’s Ilwaco Fish Co., a fish

harvester and a fish processor, are subject to a fishery

management program that limits their share of the total

allowable catch of Pacific whiting. They challenge a decision

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PACIFIC DAWN V. PRITZKER 5

by the National Marine Fisheries Service (NMFS) to calculate

the amount of their initial share based on their participation

in the fishery prior to 2003 and 2004, respectively, rather than

on their much greater participation in the years immediately

before 2010, when the regulations implementing this program

were issued. Because NMFS considered the required factors

and made a reasonable decision to use the 2003 and 2004

dates, its decision was not arbitrary or capricious, and we

affirm.

I

The Magnuson-Stevens Fishery Conservation and

Management Act (Magnuson-Stevens Act) created eight

Regional Fishery Management Councils. Each council must

create a fishery management plan, which must meet a long

list of statutory requirements. 16 U.S.C. § 1853(a). Among

other things, the plan must be “consistent with the national

standards” for fishery conservation and management. Id.

§ 1853(a)(1)(C). The National Standards are comprised of

ten broad guidelines, including the requirements that the

management measures “shall, where practicable, consider

efficiency in the utilization of fishery resources,” and “shall,

where practicable, minimize costs and avoid unnecessary

duplication.” Id. § 1851(5), (7).

Beginning in 1990, the councils were given the discretion

to use “a limited access system for the fishery in order to

achieve optimum yield.” Id. § 1853(b)(6). A limited access

system is defined as “a system that limits participation in a

fishery to those satisfying certain eligibility criteria or

requirements contained in a fishery management plan or

associated regulation.” Id. § 1802(27). It limits the number

of individuals who can enter and participate in the fisheries,

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6 PACIFIC DAWN V. PRITZKER

and gives these favored participants “privileges to harvest a

specific quantity of fish.” Pac. Coast Fed’n of Fishermen’s

Ass’ns v. Blank, 693 F.3d 1084, 1087 (9th Cir. 2012). In

establishing a limited access system, councils must take into

account “present participation in the fishery,” id.

§ 1853(b)(6)(A), “historical fishing practices in, and

dependence on, the fishery,” id. § 1853(b)(6)(B), among other

considerations.1

 

1

 16 U.S.C § 1853(b)(6) provides:

Any fishery management plan which is prepared by any

Council, or by the Secretary, with respect to any

fishery, may: . . .

(6) establish a limited access system for the fishery in

order to achieve optimum yield if, in developing such

system, the Council and the Secretary take into

account—

(A) present participation in the fishery;

(B) historical fishing practices in, and dependence on,

the fishery;

(C) the economics of the fishery;

(D) the capability of fishing vessels used in the fishery

to engage in other fisheries;

(E) the cultural and social framework relevant to the

fishery and any affected fishing communities;

(F) the fair and equitable distribution of access

privileges in the fishery; and

(G) any other relevant considerations.

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PACIFIC DAWN V. PRITZKER 7

In 2007, Congress reauthorized the Magnuson-Stevens

Act with amendments that, among other things, were intended

to encourage market-based fishery management through

“limited access privilege programs.” Pac. Coast Fed’n of

Fishermen’s Ass’ns, 693 F.3d at 1088. Such a program

(which must be part of a limited access system) allows a

fishery participant “to harvest a certain portion of the total

catch allowed for a particular species.” Id. One way to

distribute the allocated portion is through “individual fishing

quota” (IFQ), or quota shares. 16 U.S.C. § 1802(23), (26).2

In developing such a program, a council must consider

“current and historical harvests,” as well as “investments in,

and dependence on, the fishery,” among other things. Id.

§ 1853a(c)(5)(A).3

 

2

 16 U.S.C. § 1802(23) provides:

The term “individual fishing quota” means a Federal

permit under a limited access system to harvest a

quantity of fish, expressed by a unit or units

representing a percentage of the total allowable catch of

a fishery that may be received or held for exclusive use

by a person. Such term does not include community

development quotas as described in section 1855(i) of

this title.

Section 1802(26) provides:

The term “limited access privilege” . . . means a Federal

permit, issued as part of a limited access system . . .

[and] includes an individual fishing quota.

 

3

 16 U.S.C. § 1853a(c)(5) states, in pertinent part:

In developing a limited access privilege program to

harvest fish a Council or the Secretary shall– (A)

establish procedures to ensure fair and equitable initial

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8 PACIFIC DAWN V. PRITZKER

Once a regional council has prepared a fishery

management plan for each fishery within its jurisdiction that

requires such a plan, it submits the plan (and any proposed

regulations) to the Secretary of Commerce, id. § 1852(h)(1),

who has delegated her responsibilities under the Act to the

National Marine Fisheries Service (NMFS).4 The Secretary

must review the plan to determine whether it is consistent

with the National Standards and other statutory requirements,

id. § 1854(a)(1)(A), as well as publish notice of proposed

rulemaking in the Federal Register. This publication starts a

public notice and comment period. Id. § 1854(a)(1)(B). If

the Secretary approves the plan, the Secretary must review

the council’s proposed regulations for consistency with the

fishery management plan and other law. Id. § 1854(b). The

Secretary must publish the regulations as well for public

notice and comment. Id.

One of the eight regional councils is the Pacific Fishery

Management Council (Pacific Council), which consists of

California, Oregon, Washington, and Idaho and covers the

allocations, including consideration of–

(i) current and historical harvests;

(ii) employment in the harvesting and processing

sectors;

(iii) investments in, and dependence upon, the fishery;

and

(iv) the current and historical participation of fishing

communities.

4 NMFS is housed in the National Oceanic and Atmospheric

Administration in the Department of Commerce.

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PACIFIC DAWN V. PRITZKER 9

fisheries seaward of those states. Id. § 1852(a)(1)(F). One of

those fisheries is the Pacific groundfish fishery, which

“extends 200 miles into the Pacific Ocean, along the coasts of

California, Oregon, and Washington, and includes more than

90 species of fish that dwell near the sea floor.” Pac. Coast

Fed’n of Fishermen’s Ass’ns, 693 F.3d at 1088. The Pacific

Council first developed the Pacific Coast Groundfish Fishery

Management Plan (Groundfish Management Plan) in 1982. 

It covers Pacific whiting, the species of fish at issue here,

among other groundfish, and contains various goals and

objectives. One of those objectives is Objective 14, which

states that when the Council is “considering alternative

management measures to resolve an issue,” the Council

should “choose the measure that best accomplishes the

change with the least disruption of current domestic fishing

practices.”

Prior to 2004, the Pacific Council established a yearly

harvest limit for whiting and limited the number of fishing

vessels by requiring vessels to have a limited entry permit,

and parceling out only a limited number of such permits. In

addition, the Council established a short season for whiting

and allowed permitted vessels to harvest whiting only from

the time the season opened until the time the catch limit was

reached. This management structure led to a so-called

“derby-style fishery” and “a race for fish,” meaning that the

limited number of permit holders engaged in an intense,

concentrated effort at the beginning of the season because of

the potentially short window.

Because this approach did not meet the Pacific Council’s

management goals, it began contemplating an amendment to

the Groundfish Management Plan in 2003. In January 2004,

NMFS published a notice of proposed rulemaking, which

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10 PACIFIC DAWN V. PRITZKER

stated that the Pacific Council was considering implementing

a limited access privilege program in the form of a “trawl

rationalization program” for the Pacific groundfish fishery. 

Advance Notice of Proposed Rulemaking Regarding a Trawl

Individual Quota Program and to Establish a Control Date,

69 Fed. Reg. 1563-01 (Jan. 9, 2004). For the shorebased

trawl sector (which consists of vessels that catch and deliver

to processors on land), the trawl rationalization program

would consist of a trawl IFQ program, which is “a quota

system where each quota share could be harvested at any time

during an open season.” Id. at 1563. Participants in the

fishery (i.e., those who already had a limited entry permit

allowing them to fish) would need to obtain a quota share

permit as well in order to receive a share of the allowable

catch. 16 U.S.C. §§ 1853a, 1802(26). The Pacific Council

believed this trawl rationalization program would cause

participants in the fishery to spread their fishing throughout

the season and avoid the race for fish.

The proposed rulemaking also explained that the Pacific

Council was considering basing the initial allocation of quota

shares on participants’ catch history in the fishery, meaning

that participants that had a larger catch history would be

allocated a larger quota share. Due to concerns that the

announcement of this new program would create a perverse

incentive by encouraging participants to increase their fishing

efforts in order to qualify for a larger initial quota share,

NMFS announced “a control date of November 6, 2003,”

which would apply to “[p]ersons potentially eligible for

[individual quota] shares,” including “vessel owners, permit

owners, vessel operators, and crew.” 69 Fed. Reg. 1563-01,

1563. A “control date announces to the public that the Pacific

Council may decide not to count activities occurring after the

control date toward determining a person’s qualification for

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PACIFIC DAWN V. PRITZKER 11

an initial allocation or determining the amount of initial

allocation of quota shares.” Id. In 2005, NMFS clarified that

processors (in addition to harvesters) could also be eligible to

obtain quota shares. Trawl Individual Quota Program and

Establishment of a Control Date, 70 Fed. Reg. 29,713-01,

29,714 (May 24, 2005).

The Pacific Council then engaged in a lengthy process to

develop an amendment to the Groundfish Management Plan. 

Due to the complexity and controversial nature of the trawl

rationalization program, the process of analyzing data,

obtaining input from stakeholders and the public, and

developing program documents took over five years. In

2009, the Pacific Council finally submitted the trawl

rationalization program to the Secretary as Amendment 20 to

the Groundfish Management Plan. NMFS published the

proposed amendment for comment in May 2010,

Amendments 20 and 21, Trawl Rationalization Program,

75 Fed. Reg. 26,702-01 (May 12, 2010), and the proposed

regulations for implementing Amendment 20 in June 2010,

Amendments 20 and 21, Trawl Rationalization Program,

75 Fed. Reg. 32,994-01 (June 10, 2010).

After a round of notice and comment, NMFS adopted

Amendment 20 to the Groundfish Management Plan and

promulgated implementing regulations. Amendments 20 and

21, Trawl Rationalization Program, 75 Fed. Reg. 60,868-01

(Oct. 1, 2010). The program allocated quota share to various

participants in the fishery based on activity during a

qualifying time period. The qualifying time period for

harvesters ended in 2003, id. at 60,959 (promulgated as

50 C.F.R. § 660.140(d)(8)(iv)(C)(2)), while the qualifying

time period for shoreside processors ended in 2004, id. at

60,955 (promulgated as 50 C.F.R. § 660.140(d)(8)(iv)(G)).

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12 PACIFIC DAWN V. PRITZKER

The selection of the 2003 and 2004 end dates was a focus

of comment and criticism, and NMFS responded to these

criticisms in detail. NMFS noted that it had set a 2003

control date in order “to prevent future fishery disruptions”

and to “discourage entry into a fishery and increased harvest

while the Council goes through the process of developing the

program details.” 75 Fed. Reg. 60,868-01, 60,875. Having

set a control date, NMFS deemed it was important to

maintain that date in setting the qualifying history period for

two reasons. First, the Council would lose credibility if it did

not adhere to the control date: “If the Council develops a

pattern of announcing and abandoning control dates, then the

announcement of control dates will become a signal to

harvesters to intensify their efforts to catch fish in order to

increase their odds of qualifying for greater initial

allocations.” Id. Second, according to NMFS, “abandoning

the original control date would reduce the perceived fairness

of the program by rewarding those who fished speculatively

after the control date . . . at the expense of those who heeded

the control date.” Id.

After Amendment 20 (the trawl rationalization program)

became effective January 1, 2011, id. at 60,868, a group of

fishing companies brought a lawsuit challenging NMFS’s

initial allocation of quota shares for Pacific whiting. See

Pacific Dawn, LLC v. Bryson, 2011 WL 6748501 (N.D. Cal.

Dec. 22, 2011) (Pacific Dawn I). Among other claims, the

plaintiffs contended that the Pacific Council and NMFS erred

in its selection of a qualifying period, and that it should have

considered fishing history past the 2003 and 2004 end dates. 

Id. at *1. The district court held that NMFS failed to provide

a reasonable explanation for why it relied on an end date of

2003 for some purposes and 2004 for other purposes, and the

court granted plaintiffs’ motion for summary judgment on

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PACIFIC DAWN V. PRITZKER 13

that issue. Id. at *6–8. The district court remanded the

matter to NMFS for reconsideration and set a deadline of

April 1, 2013, for the agency’s decision, but it did not vacate

the rule so as not to cause disruption during the remand

period. Pac. Dawn, LLC v. Bryson, 2012 WL 554950 (N.D.

Cal. Feb. 21, 2012).

On remand, the Pacific Council considered four

alternative date ranges for qualifying history, including

ranges that took more recent history into account 

(1994–2007 and 1994–2010), and a “no action” alternative,

which maintained the end dates of 2003 for harvesters and

2004 for processors. After three meetings over six months,

more than seven hours of public testimony, and numerous

reports, the Pacific Council recommended that NMFS adopt

the no action alternative. Reconsideration of Allocation of

Whiting, 78 Fed. Reg. 72-01, 72 (Jan. 2, 2013). NMFS

determined that the council’s recommendation was consistent

with the Magnuson-Stevens Act and issued notice of its

decision to retain the original control dates for public

comment. Id.

On March 28, 2013, NMFS issued a response to the

comments and the final rulemaking, which retained the

original control dates. Reconsideration of Allocation of

Whiting, 78 Fed. Reg. 18879-01 (Mar. 28, 2013). In sum,

NMFS concluded that “there are fundamental and compelling

reasons to maintain the existing initial allocations of

whiting,” including “not rewarding increases in harvesting or

processing that occurred after the end of the qualifying

periods,” maintaining the credibility of control dates “for this

and future rationalization programs,” and “minimiz[ing] the

concentration of harvester quota.” Id. at 18880. NMFS also

responded to the various comments in detail.

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14 PACIFIC DAWN V. PRITZKER

After NMFS’s decision, two of the plaintiffs in Pacific

Dawn I, Pacific Dawn LLC (a fish harvester) and Jessie’s

Ilwaco Fish Co. (a fish processor) (collectively referred to

here as “Pacific Dawn”), brought this action in district court,

alleging that NMFS failed to consider relevant factors under

the Magnuson-Stevens Act and the Groundfish Management

Plan. A number of harvesters and processors who participate

in the fishery and the Environmental Defense Fund

intervened as defendants. The district court rejected Pacific

Dawn’s arguments and granted summary judgment to NMFS

and the defendants. Pacific Dawn appealed.

II

The district court had jurisdiction under 28 U.S.C. § 1331,

and we have jurisdiction under 28 U.S.C. § 1291. We review

the district court’s grant of summary judgment de novo. 

Fishermen’s Finest, Inc. v. Locke, 593 F.3d 886, 894 (9th Cir.

2010).

Actions taken by the Secretary under regulations

implementing fishery management plans are “subject to

judicial review to the extent authorized by, and in accordance

with,” the Administrative Procedure Act (APA). 16 U.S.C.

§ 1855(f). Judicial review under the APA allows courts to

“hold unlawful and set aside agency action, findings, and

conclusions found to be . . . arbitrary, capricious, an abuse of

discretion, or otherwise not in accordance with law.” 

5 U.S.C. § 706(2)(A). To determine whether the agency’s

decision was arbitrary and capricious, the court must consider

whether the decision was based on a consideration of the

relevant factors required by the statute, Citizens to Preserve

Overton Park, Inc. v. Volpe, 401 U.S. 402, 416 (1971);

Pension Benefit Guar. Corp. v. LTV Corp., 496 U.S. 633,

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PACIFIC DAWN V. PRITZKER 15

645–46 (1990), but “the court is not empowered to substitute

its judgment for that of the agency,” Overton Park, 401 U.S.

at 416; see also Alliance Against IFQs v. Brown, 84 F.3d 343,

345 (9th Cir. 1996).

An agency’s decision may “be found to be arbitrary and

capricious ‘if the agency 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 evidence before the agency,

or is so implausible that it could not be ascribed to a

difference in view or the product of the agency’s expertise.’” 

Yakutat, Inc. v. Gutierrez, 407 F.3d 1054, 1066 (9th Cir.

2005) (quoting Motor Vehicle Mfrs. Ass’n v. State Farm Mut.

Auto. Ins. Co., 463 U.S. 29, 43 (1983)). But where the

Secretary “has considered the relevant factors and articulated

a rational connection between the facts found and the choice

made,” the decision is not arbitrary or capricious. Alliance

Against IFQs, 84 F.3d at 345 (quoting Wash. Crab

Producers, Inc. v. Mosbacher, 924 F.2d 1438, 1440 (9th Cir.

1990)); Yakutat, 407 F.3d at 1066. “This standard of review

is highly deferential, presuming the agency action to be valid

and affirming the agency action if a reasonable basis exists

for its decision.” Pac. Coast Fed’n of Fishermen’s Ass’ns,

693 F.3d at 1091 (internal quotation marks and citations

omitted).

III

On appeal, Pacific Dawn argues that NMFS’s 2013

decision to select a qualifying period ending in 2003 for

harvesters and 2004 for processors was arbitrary and

capricious because it failed to take into account “present

participation in the fishery” as required by § 1853(b)(6)(A)

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16 PACIFIC DAWN V. PRITZKER

and dependence upon the fishery as required by

§§ 1853(b)(6)(B) and 1853a(c)(5)(A) of the MagnusonStevens Act. We consider each of these arguments in turn.

A

We begin with Pacific Dawn’s argument that NMFS’s

2013 decision to retain 2003 and 2004 as the ending date for

the qualifying period failed to take into account “present

participation in the fishery” as required by § 1853(b)(6). We

see no basis for this claim. Rather, the record makes clear

that NMFS considered “present participation,” but reasonably

gave it less weight than other factors.

NMFS first explained its analysis of this issue in the

preamble to the final rule implementing Amendment 20 (the

trawl rationalization program) and the regulations

implementing that amendment in 2010. In its response to

comments, NMFS stated that the Pacific Council and NMFS

had “analyzed and considered data including past and present

participation,” among other relevant considerations. 75 Fed.

Reg. 60,868-01, 60,885. Nevertheless, it explained that “the

Council is required to consider and balance several factors,

including current harvests and historic harvests,whenmaking

initial allocation decisions,” and while “the Council did

examine present participation levels, the Council gave greater

weight to historic participation in determining the initial

allocation.” Id.

NMFS’s 2013 decision again addressed the comments

that NMFS should “adopt a present participation requirement

for the period of 2003–2010,” rather than retain the end dates

of 2003 and 2004, and NMFS again found that other factors

outweighed the “present participation” concern. NMFS

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PACIFIC DAWN V. PRITZKER 17

stated that maintaining the qualifying period end dates of

2003 and 2004 “supports the Council’s and NMFS’ efforts to

reduce overcapitalization and end the race for fish by not

rewarding increases in harvesting or processing that occurred

after the end of the qualifying periods (i.e., after the 2003

control date).” 78 Fed. Reg. 18,879-01, 18,880, 18,884–85

(Mar. 28, 2013).5 Further, maintaining the qualifying period

was necessary to “support the importance of the control date

for this and future rationalization programs, minimize the

concentration of harvester quota, and provide for a wider

initial geographic distribution of the program benefits along

the coast and the corresponding fishing communities.” Id. at

18880. NMFS concluded that these “key factors” outweighed

“the reasons supporting alternatives that favor more recent

history.” Id.

NMFS’s explanation for giving more weight to historic

participation and maintaining the 2003 and 2004 end dates for

the qualifying period is similar to the reasoning we found

persuasive in Alliance Against IFQs v. Brown, 84 F.3d 343

(9th Cir. 1996). In that case, the Secretary of Commerce

implemented a management plan for sablefish and Pacific

halibut by regulation. Id. at 345. The management plan

required vessel owners who participated in those fisheries to

obtain an IFQ permit. Id. NMFS assigned to each owner or

lessee of a vessel that landed halibut or sablefish during 1988,

1989, or 1990, a quota share based on the person’s “highest

total legal landings” during 1984 to 1990. Id. The plaintiffs

challenged these regulations, arguing that the 1990 end date

failed to take into account “present participation in the

5

“Overcapitalization” in this context means “too many resources

directed at too few fish.” Pac. Coast Fed’n of Fishermen’s Ass’ns,

693 F.3d at 1087.

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18 PACIFIC DAWN V. PRITZKER

fishery,” 16 U.S.C. § 1853(b)(6)(A), because the final rule

was promulgated in 1993 and did not credit landings during

1991and 1992. Id. at 347. We upheld the Secretary’s

decision, in part because Congress listed “present

participation” as “only one of many factors which the Council

and the Secretary must ‘take into account.’” Id. We

concluded that the Secretary “had a good reason for

disregarding participation in the fishery during this lengthy

process, because the alternative would encourage the

speculative over-investment and overfishing which the

regulatory scheme was meant to restrain.” Id. at 347–48.

Alliance Against IFQs also determined that the

Secretary’s selection of the end dates could be deemed to be

consistent with “present participation.” Id. at 347. We noted

that the term “present participation” was not defined in the

statute. Id. Given the “substantial amount of time” required

to complete the regulatory process, including the “process of

review, publication, public comments, review of public

comments,” and the environmental impact review, we held

that the Secretary could reasonably conclude that “present

participation” did not mean “contemporaneous with the

promulgation of the final regulations.” Id. We concluded

that “while the length of time between the end of the

participation period considered and the promulgation of the

rule pushed the limits of reasonableness,” especially given

that one of the reasons for the delay was the Secretary’s

failure to meet regulatory deadlines, the use of the period

from 1988 to 1990 was not “so far from ‘present

participation’ when the regulation was promulgated in 1993

as to be ‘arbitrary or capricious.’” Id. at 347–48.

In this case, we are doubtful that individuals’ participation

in the fisheries in 2003 or 2004, which was six or seven years

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PACIFIC DAWN V. PRITZKER 19

before Amendment 20 and the implementing regulationswere

promulgated in 2010, can be deemed to constitute “present

participation.” Nor has the Secretary made such an

argument.6 Nevertheless, the Secretary’s reasons for giving

less weight to present participation, such as not rewarding

increases in fishery activity after the control date was

announced and maintaining the credibility of control dates in

the future, are sufficient to uphold the Secretary’s actions. 

The record shows that NMFS gave careful consideration to

the “present participation” factor and acted reasonably in

giving more weight to establishing and maintaining a control

date for reasons we upheld in Alliance Against IFQs, 84 F.3d

at 347. Because the Secretary “articulated a rational

connection between the facts found and the choice made,” see

id. at 350, we conclude the decision to maintain the 2003 and

2004 end dates was not arbitrary or capricious.

Pacific Dawn raises two arguments against this

conclusion. First, it challenges NMFS’s conclusion (set forth

in the final environmental impact statement that supported

NMFS’s 2013 decision) that taking current participation in

the fishery into account would have only a minor impact on

the allocation of quota shares. See Final Environmental

Impact Statement (“While a recent participation requirement

might be considered reasonable and responsive to the

[Magnuson-Stevens Act] direction to consider current and

historic participation and to consider investment and

dependence, the likely impacts on the initial [quota share]

allocation appeared to be minimal with respect to their impact

on the landing history based portion of the allocation.”) 

According to Pacific Dawn, because NMFS used a 2003 and

6 Further, the plaintiffs do not argue that the development process was

unduly prolonged.

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20 PACIFIC DAWN V. PRITZKER

2004 end date, 34 permit holders who no longer participate in

the fishery received a quota share, which constitutes almost

20 percent of the total number of permit holders that received

quota shares. Pacific Dawn argues that this means a

significant portion of the economic benefits of the trawl

rationalization program were given to permit owners who are

not participating in the fishery, which disadvantages current

participants who have made significant economic investments

in the fishery. NMFS’s failure to consider the significant

financial impact of its decision to retain the 2003 and 2004

end dates, Pacific Dawn argues, makes NMFS’s decision

arbitrary and capricious.

We reject this argument because NMFS considered the

issue and reasonably determined that the financial impact of

the end dates was not significant and did not outweigh other

benefits. NMFS acknowledged that 34 permit holders would

receive quota share under Amendment 20 even though they

had not actively participated in the fishery since 2003, but it

concluded that this fact did not warrant “including more

recent years in the qualifying period” because the majority of

these 34 permit owners were far from inactive; rather, they

had been “active in the whiting fishery during those years,

participated in other fisheries including other sectors of the

whiting fishery, or held those inactive permits as an

investment.” 78 Fed. Reg. 18,879-01, 18,883. NMFS

determined that only 1.5 percent of the permits (rather than

20 percent) were truly inactive. Id. at 18,884. Moreover,

NMFS noted that maintaining the 2003 and 2004 end dates

spread the benefits of the program more widely and avoided

concentrating quota share in the hands of a few participants. 

Id. at 18,880. According to NMFS, this goal outweighed the

reasons for adopting alternatives “that favor more recent

history.” Id. Because NMFS considered this issue, weighed

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PACIFIC DAWN V. PRITZKER 21

it against other factors that it must take into account, and

determined that the other factors outweighed Pacific Dawn’s

concerns, NMFS did not fail to “consider an important aspect

of the problem” or offer “an explanation for its decision that

runs counter to the evidence before the agency.” State Farm,

463 U.S. at 43. Because we cannot substitute our judgment

for the agency’s, Overton Park, 401 U.S. at 416, and must

only determine whether the agency “articulated a rational

connection between the facts found and the choice made,”

Yakutat, 407 F.3d at 1066, we conclude that NMFS’s

determination on this point was not arbitrary or capricious.

Second, Pacific Dawn argues that NMFS’s application of

“present participation” was arbitrary because it adopted a

2004 end date for processors rather than the 2003 end date

adopted for harvesters. According to Pacific Dawn, NMFS

failed to give a satisfactory explanation for this inconsistency. 

Again, we disagree. NMFS explained its reasons for using a

different end date for determining the eligibility of processors

for quota share. First, NMFS explained that “it was not clear

until 2005 that the 2003 control date potentially applied to

processors,” and NMFS concluded that the different end date

was necessary to account “for processor investments that took

place prior to the announcement of the control date but that

did not begin to earn processing history until 2003 and 2004.” 

78 Fed. Reg. 18,879-01, 18,880–81. Second, because

processors have onshore facilities, and cannot “move into and

out of various fisheries to gain potential fishing history” as

easily as harvesters, there was less danger of creating

perverse incentives by changing the control date. Id. NMFS

explained its reasoning and related its determination to other

statutory factors, such as “the economics of the fishery” and

a “fair and equitable distribution.” Id. at 18,889–91; see

16 U.S.C § 1853(b)(6). We therefore conclude that NMFS’s

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22 PACIFIC DAWN V. PRITZKER

decision to apply the 2004 control date to processors was not

arbitrary or capricious.

B

Closely related to its argument that NMFS did not take

into account “present participation,” Pacific Dawn also

argues that NMFS’s 2013 decision did not adequately

consider “dependence” on the fishery. See 16 U.S.C.

§§ 1853(b)(6)(B), 1853a(c)(5)(A). According to Pacific

Dawn, NMFS’s 2013 decision to maintain the 2003 and 2004

end dates did not give adequate weight to current dependence

on the fishery because it allocated quota shares to individuals

who had not necessarily fished in the past ten years and

therefore were not necessarily dependent on the fishery. This

error, Pacific Dawn contends, made NMFS’s 2013 decision

inconsistent with various provisions ofthe Magnuson-Stevens

Act, Objective 14 of the Groundfish Management Plan, and

NMFS’s past practices in other fisheries.

Again, we see no basis for this claim. In proposing to

retain the 2003 and 2004 end dates, NMFS provided a

thorough explanation of its methodology for evaluating

“dependence.” 78 Fed. Reg. 72-01, 74–76. Although the

Magnuson-StevensAct does not define “dependence,” NMFS

defined the term to mean “the degree to which participants

rely on the whiting fishery as a source of wealth, income, or

employment to financially support their business.” Id. at 74. 

Further, “[c]urrent harvests, historical harvests, levels of

investment over time, and levels of participation over time

are all aspects of dependence, as they can all be connected to

the processes that fishers and processors use to generate

income.” Id. In addition, the proposed rule explained that it

was not NMFS’s policy “to use recent fishing as the only

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PACIFIC DAWN V. PRITZKER 23

reflection of dependence on the fishery,” nor was it NMFS’s

policy “to use recent fishing as the sole basis for determining

the allocation period; such a determination must always be

based on the specific facts each time allocations are

considered.” Id. at 75.

With respect to the proposed decision on the 2003 and

2004 end dates for allocating quota shares, NMFS explained

its analysis of dependence. First, NMFS stated that it gave

weight to financial dependence in its “choice of ending the

qualifying period for processors in 2004 rather than the 2003

control date,” because that change “was done to explicitly

recognize investments in processing while still furthering the

purposes of Amendment 20.” Id. at 74–75. Second, while

recognizing that its chosen end date for harvesters would

result in allocating a small percentage of quota shares to

harvesters “without activity in the whiting fishery post 2003,”

NMFS stated that awarding quota share in this small number

of cases was outweighed by the need to serve other goals. Id.

at 75. After considering dependence upon the fishery and

weighing dependence against other factors, NMFS proposed

not to change its end dates because “the existing qualifying

periods for harvesters and processors result in a fair and

equitable allocation.” Id. at 74.

In its final decision on this issue, NMFS reiterated that it

had “thoroughly explored” the “issue of investment and

dependence for more recent years.” 78 Fed. Reg. 18,879-01,

18,884. NMFS determined that retaining the qualifying

period ending in 2003 or 2004 would not unduly affect

current dependence on the fishery because “most current

harvesters and processors in the fishery were also historical

participants during the qualifying periods for initial

allocation, and the shifts in quota among the initial allocation

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24 PACIFIC DAWN V. PRITZKER

alternatives considered were relatively modest overall and for

a majority of the participants.” Id. Moreover, NMFS

repeated its conclusion that there were “valid policy reasons

for excluding those years,” including the “fair and equitable”

distribution of access privileges. Id. at 18,885; see 16 U.S.C.

§ 1853(b)(6). Because NMFS adequately took into account

“dependence on the fishery” under § 1853(b)(6)(B) and

“investments in, and dependence upon, the fishery” under

§ 1853a(c)(5)(A)(iii), its decision was not inconsistent with

those statutory requirements. See Yakutat, 407 F.3d at 1066.

Nor was NMFS’s decision inconsistent with the related

standards identified by Pacific Dawn. First, Pacific Dawn

argues that NMFS’s 2013 decision was inconsistent with

National Standards 5 and 7,7 which require councils to,

“where practicable, consider efficiency in the utilization of

fishery resources” and “minimize costs and avoid

unnecessary duplication.” 16 U.S.C. §§ 1851(a)(5), (7). 

Pacific Dawn claims that NMFS’s allocation of quota shares

to individuals who are not dependent on the fishery results in

inefficiencies and creates additional costs and duplication of

expenses for current participants who must purchase or lease

additional quota shares. This claim is belied by the record;

NMFS reasonably concluded that the use of the 2003 and

2004 end dates was consistent with National Standards 5 and

7 because the trawl rationalization program as a whole

minimized costs and efficiently used fishery resources to the

7 The plaintiffs also argue that the agency violated National Standard 4,

which states that allocation of fishing privileges should be “fair and

equitable,” 16 U.S.C. § 1851(a)(4). But the plaintiffs did not raise that

argument to the district court in their motion for summary judgment or

opposition to the defendants’ motion for summary judgment, so the

argument was waived. See Lands Council v. McNair, 629 F.3d 1070,

1079 n.4 (9th Cir. 2010).

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PACIFIC DAWN V. PRITZKER 25

extent practical. 78 Fed. Reg. 18,879-01, 18,888. According

to NMFS, Amendment 20 was designed to make the

groundfish trawl fishery economically efficient by reducing

excess capacity and levels of incidental catch, and the

selection of the 2003 and 2004 end dates would not affect

these efficiency gains. Id. NMFS acknowledged that the

initial allocation of quota shares could result in “transition

costs and disruption to participants’ operations,” but the new

costs would result in additional benefits to fishery

participants, and the transaction costs would decrease “as the

fishery moves to its long-term, more efficient state” because

“operations will move, or quota will be traded, to the ports in

which the highest profits can be earned.” Id.

Second, Pacific Dawn claims that NMFS’s decision to

retain the 2003 and 2004 end dates was contrary to the

Groundfish Management Plan’s direction in Objective 14 to

“choose the measure that best accomplishes the change with

the least disruption of current fishing practices.” Pacific

Dawn argues that NMFS failed to provide a rational

explanation for how the exclusion of ten years of fishing

history meets Objective 14 and argues at length that the 2003

and 2004 end dates disrupt the activities of participants

currently dependent on the fisheries. We again disagree. 

NMFS considered Objective 14, 78 Fed. Reg. 72-01, 75, and

reasonably determined that retaining the 2003 and 2004 end

dates would be the least disruptive to current fishing

practices. NMFS explained that when it first announced the

2003 control date, participants were on notice that fishing

activity after 2003 might not count toward allocation of quota

share, and participants had the opportunity to acquire

additional quota shares. 78 Fed. Reg. 18,879-01, 18,881. 

Maintaining the original control date in the final rule

“rewards investments and dependence consistent with the

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26 PACIFIC DAWN V. PRITZKER

policies underlying announcing a control date, and minimizes

disruption to those participants that made business decisions

based on the assumption that quota formulas were unlikely to

include more recent years.” Id. at 18888. Because NMFS

reasonably determined that retaining the 2003 and 2004 end

dates would be the least disruptive to current fishing

practices, its conclusion was not inconsistent with Objective

14 of the Groundfish Management Plan.

Finally, Pacific Dawn argues that NMFS’s decision was

inconsistent with its practices in other fisheries, where NMFS

had concluded that more recent participation reflected greater

dependence on the fishery. This argument fails. NMFS

considered “the reasons supporting alternatives that favor

more recent history (e.g., recognizing recent fishery

participants’ dependence and investments, reducing future

quota leasing or acquisition costs, reducing quota to recent

non-participants, and reflecting more recent market and

fishery conditions),” but reasonably determined that they

were outweighed by other factors such as “reducing

overcapitalization and ending the race for fish.” Id. at 18,880. 

NMFS reasonably relied on its policy to review the facts of

each case “each time allocations are considered.” 78 Fed.

Reg. 72-01, 74. Its conclusion was thus not “arbitrary,

capricious, an abuse of discretion, or otherwise not in

accordance with law.” 5 U.S.C. § 706(2)(A).

IV

We conclude that NMFS properly considered the relevant

factors and reasonably decided to maintain the 2003 and 2004

end dates. See Alliance Against IFQs, 84 F.3d at 345. We

therefore affirm the district court’s grant of summary

judgment to the defendants.

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PACIFIC DAWN V. PRITZKER 27

AFFIRMED.

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