Opinion ID: 203233
Heading Depth: 4
Heading Rank: 1

Heading: EQB Governing Board

Text: The EQB is an administrative body comprised of three members appointed for a four-year term by the Governor of Puerto Rico with the advice and consent of the Puerto Rico Senate. P.R. Laws Ann. tit. 12, § 1129(a). The agency is tasked with the responsibility of adopting and enforcing Puerto Rico's environmental statutes and regulations, and is empowered to impose sanctions and administrative fines on violators, id. at § 1136(c), -16- as well as issue orders mandating the cessation of harmful activities, id. at § 1131(22). Those administrative fines –- the crux of this case –- are then deposited into the Special Account of the Board on Environmental Quality. Id. at § 1136(f), (k); § 1131(16)(A) (All monies received by the [EQB] in the fulfillment of its duty to implement [environmental regulations] . . . shall be deposited in a special account to be known as the 'Environmental Quality Board Special Account.'). That money is then place[d] at the disposal of the [EQB] . . . through payment orders authorized or signed by the Chairperson of the [EQB]. Id. at § 1131(16)(A). Esso asserts that it was denied a fair hearing because of the EQB's structural bias. Specifically, Esso contends that the EQB has an institutional interest in imposing hefty fines because the collected monies are deposited into an EQB Special Account over which the EQB has limitless discretion. Moreover, in this case, the proposed fine –- $76 million -- is more than double the EQB's annual budget. In response, the defendants attempt to focus the inquiry on the individual members of the EQB, rather than the agency as a whole; the EQB Governing Board members are salaried and thus have no personal pecuniary interest in the fines imposed and collected by the agency. Not only is the defendants' argument utterly unsupported by the law, but we have already rejected it. See Esso I, 389 F.3d at 219. On last appeal, we expressly stated, -17- [T]he adjudicative body stands to benefit financially from the proceeding because any fine imposed will flow directly to the EQB's budget. Although members of the EQB Governing Board may not stand to gain personally . . . a pecuniary interest need not be personal to compromise an adjudicator's neutrality. Id. at 218-19. Although the law of the case doctrine has been refined over time and we have identified several instances in which reconsideration of a past decision may be appropriate, see Ellis v. United States, 313 F.3d 636, 647-48 (1st Cir. 2002); this is not such an instance. This court's prior rejection of the defendants' argument is neither unreasonable [n]or obviously wrong. Id. at 648 & n.5. Last time, we properly concluded that the bias stems from the potential financial benefit to the EQB's budget as a result of an imposed fine. Esso I, 389 F.3d at 219; cf. Ward v. Vill. of Monroeville, 409 U.S. 57, 59-60 (1972) (invalidating the mayor's court because a substantial portion of the village funds were comprised of the fines he imposed for traffic violations). In Ward, the Supreme Court expressed concerns that the funding structure would offer a possible temptation to the average man to the extent that there is a situation in which an official perforce occupies two practically and seriously inconsistent positions, one partisan and the other judicial [and] necessarily involves a lack of due process of law. Ward, 409 U.S. at 60 (quoting Tumey v. -18- Ohio, 273 U.S. 510, 532, 534 (1927)). This is not a situation in which the EQB Governing Board is so removed from the financial policy of the Special Account that such a presumption of bias is inapplicable. Cf. Dugan v. Ohio, 277 U.S. 61 (1928). Rather, this is a case in which the EQB has complete discretion over the usage of those funds which are supplied, at least in part, by fines which it imposes. In this particular case, the possibility of temptation is undeniable and evident in the fact that the size of the proposed fine in this case is so unprecedented and extraordinarily large. The $76 million proposed fine -- a sum twice the EQB's annual operating budget and 5,000 times greater than the largest fine ever imposed by the EQB -- only intensifies the appearance of bias infecting the proceedings.