Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-07-05153/USCOURTS-caDC-07-05153-0/pdf.json

Parties Involved:
Alaska Marine Conservation Council
Appellee
Fishing Company of Alaska, Inc.
Appellant
Carlos Gutierrez
Appellee
Oceana
Appellee

Document Text:

United States Court of Appeals 

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued November 6, 2007 Decided December 18, 2007 

No. 07-5153 

FISHING COMPANY OF ALASKA, INC.,

APPELLANT

v. 

CARLOS GUTIERREZ, IN HIS OFFICIAL CAPACITY AS THE 

SECRETARY OF COMMERCE, ET AL., 

APPELLEES

Appeal from the United States District Court 

for the District of Columbia 

(No. 06cv00835) 

Shaun M. Gehan argued the cause for appellant. With 

him on the briefs was David E. Frulla. 

Stacey W. Person, Attorney, U.S. Department of Justice, 

argued the cause for federal appellee. With her on the brief 

was John L. Smeltzer, Attorney. R. Craig Lawrence, Assistant 

U.S. Attorney, entered an appearance. 

Eric P. Jorgensen and Janis Searles were on the brief for 

intervenor-appellees Oceana and Alaska Marine Conservation 

Council. 

USCA Case #07-5153 Document #1086986 Filed: 12/18/2007 Page 1 of 10
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Before: HENDERSON and TATEL, Circuit Judges, and 

WILLIAMS, Senior Circuit Judge. 

Opinion for the Court filed by Senior Circuit Judge

WILLIAMS. 

WILLIAMS, Senior Circuit Judge: In April 2006, the 

Secretary of Commerce (the “Secretary”), via his delegee the 

National Marine Fisheries Service (the “Service”), see C & W 

Fish Co. v. Fox, 931 F.2d 1556, 1558 & n.1 (D.C. Cir. 1991), 

issued a final rule establishing a minimum “groundfish 

retention standard” for the Bering Sea and Aleutian Islands 

fishing region. See Groundfish Retention Standard, 71 Fed. 

Reg. 17,362 (Apr. 6, 2006) (to be codified at 50 C.F.R. pt. 679) 

(the “Final Rule”). In issuing the rule, the Service exercised 

authority under the Magnuson-Stevens Fishery Conservation 

and Management Act (“MSA”), 16 U.S.C. §§ 1801-1883. 

The Fishing Company of Alaska (“FCA”), an operator of 

commercial fishing vessels in the region, sued the Secretary in 

district court, claiming that the rule was unlawful because of 

its inclusion of three monitoring and enforcement (“M&E”) 

requirements. FCA argued that the Service had adopted the 

rule without statutorily required predicate action by the North 

Pacific Fishery Management Council (the “Council”), a 

regional body created by the MSA to represent state 

governments, certain agencies of the federal government, and 

other interested constituencies. See § 1852(a)(1)(G). FCA 

also claimed that the M&E requirements were substantively 

inconsistent with the MSA’s “National Standards” for 

conservation. § 1851(a)(7)-(10). 

Both sides sought summary judgment, which the district 

court granted in favor of the defendants. Legacy Fishing Co. 

v. Gutierrez, No. 06-835 (D.D.C. Mar. 20, 2007). FCA 

appeals, and we reverse, finding that the inadequacy of the 

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Council’s action fatally tainted the Final Rule’s three 

challenged M&E requirements. 

* * * 

The fertile seas off the Alaskan coast are home to a wide 

variety of fish. Among them are many species of groundfish, 

which spend most of their lives on or near the ocean floor. To 

capture these groundfish, fishing vessels in the Bering Sea and 

Aleutian Islands region drag large nets known as “trawls” 

across the ocean floor and then haul them up on deck. 

Sometimes the trawls dredge up unwanted fish, known as 

“bycatch”; the vessels discard these back into the ocean (often 

dead or dying). 

In 1996 Congress responded to environmental concerns 

about bycatch by amending its formal statement of policy in 

the MSA, adding a goal of “minimiz[ing] bycatch” (subject to 

various constraints). See § 1801(c)(3). 

Under the MSA’s unusual regulatory framework, the 

Council is required to implement congressional policies in its 

region by developing a fishery management plan (“FMP”), as 

well as necessary amendments thereto. § 1852(h)(1). Neither 

FMPs nor amendments may take effect without being 

submitted to the Secretary, who publishes them for comment 

in the Federal Register and reviews them for compliance with 

applicable law. § 1854(a).

The Council also proposes regulations to implement the 

FMP and its amendments. Under the statute, “[p]roposed 

regulations which the Council deems necessary or 

appropriate for the purposes of . . . implementing a fishery 

management plan or plan amendment shall be submitted to the 

Secretary simultaneously with the plan or amendment.” 

§ 1853(c) (emphasis added). The Secretary must then review 

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the proposed regulations for consistency with the FMP and 

amendments, as well as with the MSA and other applicable 

law. § 1854(b)(1). If he finds them inconsistent, he must 

return the regulations to the Council with proposed revisions. 

§ 1854(b)(1)(B). Otherwise, he must publish the regulations 

for comment in the Federal Register, “with such technical 

changes as may be necessary for clarity and an explanation of 

those changes.” § 1854(b)(1)(A). After the public comment 

period has expired, the Secretary must then promulgate final 

regulations, consulting with the Council on any revisions and 

explaining his changes in the Federal Register. § 1854(b)(3). 

Throughout this process, the Secretary is bound by the judicial 

review provisions of the Administrative Procedure Act, 

including the requirement that his actions not be “arbitrary, 

capricious, an abuse of discretion, or otherwise not in 

accordance with law.” See § 1855(f); 5 U.S.C. § 706(2)(A). 

The regulation at issue here originated in the Council’s 

vote, at its June 2003 meeting, to endorse the concept of a 

minimum groundfish retention standard, which would impose 

economic disincentives on vessels with high rates of bycatch. 

To that end it adopted Amendment 79 to its FMP. See 

Groundfish Retention Standard, 70 Fed. Reg. 35,054, 35,055 

(June 16, 2005) (the “Proposed Rule”); see also Final Rule, 71 

Fed. Reg. at 17,362; Joint Appendix (“J.A.”) 193 (providing 

the text of Amendment 79). Simultaneously with its adoption 

of Amendment 79, the Council approved a brief outline of 

regulatory measures designed to implement the Amendment. 

This outline included certain enforcement measures, such as a 

requirement that vessels use certified scales to weigh their fish 

and keep observers on board to monitor bycatch. N. Pac. 

Fishery Mgmt. Council, Minutes of the 162nd Plenary Session 

app. VII (June 2003), J.A. 161. 

Once the full Council had approved the outline, it took no 

further action. Instead, the Service, in accordance with what 

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the parties accept as customary practice in the Alaska 

fisheries, began to draft language for the proposed regulation, 

based on the Council’s substantive outline. On May 24, 2005, 

the Service sent the text of the proposed regulation to the 

Council’s Executive Director—an employee of the Council 

and a member of its staff, not a Council member in his own 

right—stating that “you should now submit all documents 

required for Secretarial review.” J.A. 364. 

The draft text delivered to the Executive Director, 

however, contained three M&E requirements that were not 

mentioned in the Council’s June 2003 outline. These 

provisions required that vessels not mix fish from distinct 

“hauls” in the same holding bin; that observers take samples 

of the catch from a single location only, with a clear line of 

sight between the holding bin and the scale where fish are 

weighed; and that vessels operate only one scale at any given 

time. See Final Rule, 71 Fed. Reg. at 17,382 (to be codified at 

50 C.F.R. § 679.27(j)(3)(ii)-(iii)). 

Two days after the Service’s delivery of the draft, on May 

26, the Executive Director dutifully returned copies of the 

requested documents to the appropriate offices of the Service. 

J.A. 192. In due course the Service issued the Proposed Rule 

and, after comment, the Final Rule. 

* * * 

FCA does not challenge the role of the Service in drafting 

the formal language of the proposed regulation, only the 

divergence of this language from the substance previously 

approved by the Council. The Service has acknowledged that 

the M&E requirements “were not before the Council when it 

took its final action” in June 2003. Final Rule, 71 Fed. Reg. at 

17373. The Secretary contends, however, that the MSA “says 

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nothing about the process of developing proposed 

regulations,” and that the regulation as a whole was properly 

submitted under the law when the Council, “by and through 

its Executive Director,” transmitted the copied documents 

back to the Service in May 2005. Gutierrez Br. 28, 30. 

Neither party considers whether the Council had ever 

purported to authorize the Executive Director to approve new 

M&E requirements on its behalf. Under the Council’s current 

bylaws, for example, approval of an FMP, amendment, or new 

regulation requires a formal roll call vote of the full Council. 

See N. Pac. Fishery Mgmt. Council, Statement of Organization, 

Practices, and Procedures § 3.2(2) (June 10, 2007), 

http://www.fakr.noaa.gov/npfmc/misc_pub/sopp607.pdf. The 

record does not reveal whether or not these provisions were in 

effect in May 2005. Nor is it obvious that the MSA—which 

identifies preparing FMPs and amendments thereto as the first 

of the Council’s functions, 16 U.S.C. § 1852(h)(1)—permits 

such a holus-bolus delegation of the Council’s regulatory 

authority. 

Fortunately, however, we need not reach these questions. 

Assuming arguendo that the Executive Director’s acts in this 

matter can properly be attributed to the Council, he never 

purported to make the statutorily required finding. Recall that 

the Council is to submit to the Secretary proposed regulations 

which it “deems necessary or appropriate for the purposes of 

. . . implementing a fishery management plan or plan 

amendment . . . simultaneously with the plan or amendment.” 

§ 1853(c) (emphasis added). 

At no point did the Executive Director purport to “deem” 

the three new M&E requirements “necessary or appropriate.” 

Under normal circumstances, such as the formal votes 

required by the Council’s current bylaws, the “ultimate 

finding will be implied from the action taken.” Ethyl Corp v. 

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EPA, 541 F.2d 1, 12 n.15 (D.C. Cir. 1976). Here, however, 

there is no indication that anyone acting for the Council knew 

that the M&E requirements existed, let alone “deem[ed them] 

necessary or appropriate,” before the Executive Director 

submitted them to the Secretary. The Service’s May 24 letter 

called no attention to the added provisions in the draft text and 

was mandatory in tone: “Under procedures for initiating 

Secretarial review, you should now submit all documents 

required for Secretarial review to the Alaska region. The 

Council must also submit a specified number of copies . . . .” 

J.A. 364. The Executive Director, evidently seeing his role as 

that of a mailroom clerk, made the distribution as instructed but 

expressed no “deem[ing]” and, in his cover letter executing the 

Service’s instructions, made no note of the substantive 

changes. J.A. 192. And while the Council staff participated in 

developing the Environmental Assessment and other 

supporting documents accompanying the Proposed Rule, these 

documents as of July 2005 still assumed the absence of rules 

like those in the M&E provisions. For example, they discussed 

whether vessels might comply with the rules by installing 

multiple scales, even though the M&E requirements’ practical 

effect was to limit each vessel to a single scale. J.A. 651.

In adding the M&E requirements to the draft text, the 

Service went far beyond the mere translation of Councilapproved substance into formal regulatory language. The 

Council’s June 2003 outline required vessels to use certified 

scales to measure the total amount of fish caught, and to keep 

independent observers on the vessels who would monitor the 

handling of the catch. J.A. 161. While the Service defended 

its additional measures as “clarifications” of the “details” of 

the monitoring program, Final Rule, 71 Fed. Reg. at 17373, 

there was no lack of clarity in the Council’s June 2003 

outline, merely an absence of more exacting requirements. 

The Secretary describes the M&E provisions as “not 

inconsistent” with the Council’s outline, Gutierrez Br. 38, but 

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agency regulations are defined not only by what they prohibit, 

but also by what they allow. As compared to the Council’s 

June 2003 outline, the M&E requirements were material 

additions that made unlawful certain fishing practices that 

would otherwise have been perfectly lawful. 

In fact, the Service has admitted that the Council’s first 

opportunity to consider the M&E requirements took place 

after their submission to the Secretary, not before. Final Rule, 

71 Fed. Reg. at 17373. In meetings held in June 2005, shortly 

after the regulation was submitted by the Executive Director, 

the Council discussed the regulation and later heard public 

comment on the new M&E requirements. The Council then 

provided the Service with its own comments, expressing 

concern with the M&E requirements’ effective date and 

suggesting that vessels be given more time to comply. J.A. 

252-53. 

The Secretary would have us treat these developments as 

ratification or at least “acquiescence” in the M&E 

requirements. See Gutierrez Br. 40. But he points to nothing 

in the Council’s activities suggesting that it conceived itself as 

“deem[ing]” the proposed regulation “necessary or 

appropriate.” So far as appears, the Council took insertion of 

the three new M&E requirements as a done deal, leaving it no 

more role than to propose palliatives. 

The Council was right to perceive its post-transmittal role 

as limited. It had previously deemed appropriate the 

substance of the proposed regulation (but for the M&E 

requirements), and the parties here agree that the Executive 

Director effectively transmitted the regulation to the Secretary 

under § 1853(c)(1), though they dispute whether a condition 

precedent to that regulation’s lawful adoption—the 

deeming—had been met as to the M&E requirements. “Upon 

transmittal,” the Secretary was then obliged to “immediately 

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initiate an evaluation” of the regulation’s consistency with the 

amended FMP and applicable law, in preparation for public 

notice and comment. § 1854(b)(1). The Council’s posttransmittal opinion of the M&E provisions is thus beside the 

point; even had the Council risen up in outrage at the 

provisions, it could not have removed them. The Council is 

free to submit comments on a proposed rule (as are others), 

but power to alter the rule before it becomes final rests only 

with the Secretary. § 1854(b)(3). That the Council delayed 

sending its letter to the Service until July 5, 2005, more than 

two weeks after the Proposed Rule had been published in the 

Federal Register, further demonstrates that its intent was only 

to comment, and not to alter, adopt, or ratify. 

Whether or not the Council attempted to ratify the M&E 

requirements, moreover, it remained the Secretary’s duty to 

review the proposed regulation for consistency with 

applicable law, including the MSA’s required procedures. 

The Secretary argues that he followed all appropriate 

procedures, and that under Yakutat, Inc. v. Gutierrez, 407 F.3d 

1054 (9th Cir. 2005), an MSA plaintiff who alleges 

insufficient deliberation on the Council’s part “must 

demonstrate irregularities in the Secretary’s actions or show 

that the Secretary followed incorrect procedures.” Id. at 1072. 

We need not decide whether this is a correct statement of the 

law, because here there was an irregularity in the Secretary’s 

conduct: in reviewing the regulation for consistency with 

applicable law, he was obligated to decide whether the 

entirety of the proposed regulation had been lawfully 

submitted, i.e., with the requisite deeming, which it had not. 

Because the Secretary should have insisted on some indication 

that the Council “deem[ed]” the M&E requirements necessary 

or appropriate prior to their submission, his decision to 

publish the Proposed Rule as it then read was “inconsistent 

with law,” 5 U.S.C. § 706(2)(A), and FCA is entitled to relief. 

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* * * 

We therefore reverse the district court’s grant of summary 

judgment to the appellees and remand the case with instructions 

to vacate the three disputed M&E requirements of the Final 

Rule. See 5 U.S.C. § 706(2). 

So ordered. 

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