Court Opinion

ID: 2821999
Source: CourtListenerOpinion
Date Created: 2015-07-30 17:01:23.043044+00
Date Added: 2024-06-11T12:12:51.549748
License: Public Domain

FOR PUBLICATION

  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT

PATRICK NOVAK; DANIEL ROCHA;              No. 13-16383
LARRY KENNER, DBA Kenner, Inc.,
a Hawaii corporation; KEN                    D.C. No.
SCHOOLLAND; BJORN ARNTZEN;                1:12-cv-00638-
PHILIP R. WILKERSON; WILLIAM                 LEK-RLP
AKINA, PH.D., Individually and as
Representatives of a Class of
Similarly Situated Persons,                 OPINION
                Plaintiffs-Appellants,

                  v.

UNITED STATES OF AMERICA;
DOES 1–1000,
             Defendants-Appellees.

      Appeal from the United States District Court
                for the District of Hawaii
      Leslie E. Kobayashi, District Judge, Presiding

                Argued and Submitted
         February 19, 2015—Honolulu, Hawaii

                   Filed July 30, 2015

      Before: Richard R. Clifton, N. Randy Smith,
       and Michelle T. Friedland, Circuit Judges.
2                   NOVAK V. UNITED STATES

                  Opinion by Judge Clifton;
                Concurrence by Judge Friedland

                           SUMMARY*

                             Jones Act

    The panel affirmed the district court’s dismissal of an
action challenging the constitutionality of the Jones Act’s
cabotage provisions, which prohibit foreign competition in
the domestic shipping market.

    Plaintiffs alleged that the Jones Act’s provisions impaired
interstate trade between Hawaii and the rest of the United
States to such an extent that they violated the Constitution.
Plaintiffs are individuals and a corporation who reside in
Hawaii and claim to have suffered pecuniary injury when
they purchased domestic ocean cargo shipping services on
west coast Hawaii routes.

    The panel held that plaintiffs did not meet their burden to
show causation or redressability, two requisite elements for
Article III standing. The panel further held that although it
was possible that plaintiffs could establish standing if they
amended their complaint, any amendment would be futile
because plaintiffs’ Commerce Clause challenge to the Jones
Act would fail on the merits. The panel held that an amended
complaint would be subject to dismissal for failure to state a
claim because the enactment of the Jones Act was not beyond

  *
    This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
                 NOVAK V. UNITED STATES                      3

the authority assigned to Congress under the Commerce
Clause. The panel also rejected plaintiffs’ claim alleging that
the Jones Act violated protections guaranteed under the Due
Process Clause of the Fifth Amendment. Finally, the panel
held that the district court did not violate plaintiffs’
procedural due process by ruling on the government’s motion
to dismiss without an oral hearing.

    Judge Friedland concurred. She wrote separately to
express her view that San Diego County Gun Rights
Committee v. Reno, 98F.3d 1121 (9th Cir. 19966), which
drove the majority opinion’s conclusion that plaintiffs lacked
Article III standing, should be reconsidered in an appropriate
case.

                         COUNSEL

John S. Carroll (argued), Honolulu, Hawaii, for Plaintiffs-
Appellants.

Rachel S. Moriyama (argued), Assistant United States
Attorney, and Florence T. Nakakuni, United States Attorney,
Honolulu, Hawaii, for Defendant-Appellee.
4                NOVAK V. UNITED STATES

                         OPINION

CLIFTON, Circuit Judge:

     This action challenges the constitutionality of the Jones
Act’s cabotage provisions, which prohibit foreign
competition in the domestic shipping market. Plaintiffs
allege that these provisions impair interstate trade between
Hawaii and the rest of the United States to such an extent that
they violate the Constitution. The district court dismissed the
action with prejudice, concluding that Plaintiffs failed to
satisfy what it framed as prudential standing requirements
because they alleged only generalized grievances shared with
all residents and businesses in Hawaii.

    We affirm the dismissal of this action. Plaintiffs have
alleged more than generalized grievances and have
demonstrated an “injury in fact,” but have not met their
burden to show causation or redressability, the other two
elements of Article III standing. Although it is possible that
Plaintiffs could establish standing if they amended their
complaint, any amendment would be futile because Plaintiffs’
challenge to the Jones Act would fail on the merits. An
amended complaint would, we conclude, be subject to
dismissal for failure to state a claim because the enactment of
the Jones Act was not beyond the authority assigned to
Congress under the Commerce Clause. To the contrary, that
statute is precisely the kind of legislation, a regulation of
interstate commerce, that the Commerce Clause empowers
Congress to enact.
                     NOVAK V. UNITED STATES                                 5

I. Background

    Plaintiffs are six individuals and one corporation.1 All
reside in Hawaii and claim to have suffered pecuniary injury
when they purchased “domestic ocean cargo shipping
services on west coast Hawaii routes.” They sued the United
States, claiming that the root of their problem is found in the
cabotage provisions of the Jones Act, formally known as the
Merchant Marine Act of 1920. Cabotage is the transport of
goods or passengers between two points in the same country.
Black’s Law Dictionary 243 (10th ed. 2014).

    The purpose of the Jones Act is to support this country’s
merchant marine and its shipbuilding and repair facilities, at
least in part so they may be available in times of war or
national emergency. 46 U.S.C. § 50101. One way the statute
aims to accomplish this objective is by limiting the domestic
shipping market to American companies, excluding foreign
competitors. Under the cabotage provisions, any ship
carrying cargo between two points in the United States must
have been “built in the United States,” 46 U.S.C.
§ 12112(a)(2)(A), and be “wholly owned by citizens of the
United States,” id. § 55102(b)(1).

   1
     The individual plaintiffs and appellants are Patrick Novak, Daniel
Rocha, Ken Schoolland, Bjorn Arntzen, Philip Wilkerson, and William
Akina; the corporate plaintiff and appellant is Kenner Inc. The action was
filed as a putative class action on behalf of all persons and entities who
purchased shipping services between the continental United States and
Hawaii in compliance with the Jones Act from at least September 1, 1959
to the present. Plaintiffs did not seek class certification prior to dismissal
of the action by the district court. Although they initially sought damages
and injunctive relief, Plaintiffs have abandoned their claim for damages.
6                NOVAK V. UNITED STATES

    According to Plaintiffs, these provisions violate the basic
tenets of the Commerce Clause because they have effectively
“impaired, hindered, and substantially affected and
completely cut off Hawaii from interstate commerce.” “In
the absence of highways and railways,” the complaint alleges,
“the Jones Act promises to nullify interstate commerce to the
State of Hawaii.”

    Plaintiffs’ theory is that, by excluding foreign
competition, the cabotage provisions have created “an
essentially monopolistic Hawaiian ocean shipping market”
that has resulted in “high prices” and “a de facto duopoly” of
two established firms in the Hawaii-mainland shipping
market. Plaintiffs contend that all Hawaii residents and
businesses, including themselves, have been harmed not only
by the increased shipping costs, but also by the resultant
inflated cost of doing business in Hawaii because higher
shipping costs lead to higher prices for imported goods.
Plaintiffs assert that interstate trade between Hawaii and the
rest of the United States has been significantly stifled to such
an extent that the effect of the Jones Act’s restrictions
amounts to “an unlawful restraint of trade and interstate
commerce, thereby violating the Commerce Clause of the
United States Constitution.” Plaintiffs filed this action
against the United States, asserting a single cause of action
under the Commerce Clause.

    The district court granted the government’s motion to
dismiss the action with prejudice, holding that Plaintiffs
failed to establish standing on prudential grounds because
they alleged only generalized grievances. Specifically, the
court concluded that “Plaintiffs assert only generalized claims
on behalf of an extremely broad class of persons or entities
that pay for interstate shipping or are consumers of goods that
                 NOVAK V. UNITED STATES                      7

have been shipped in interstate commerce. . . . This type of
broad, generalized allegation is simply insufficient to meet
standing requirements.” The court’s order cited Arizonans
for Official English v. Arizona, 520 U.S. 43, 64 (1997), and
United States v. Hays, 515 U.S. 737, 743 (1995), among other
authorities.

   Plaintiffs appealed.

II. Discussion

    We review de novo a district court’s determination on the
issue of standing. Levine v. Vilsack, 587 F.3d 986, 991 (9th
Cir. 2009). “Where standing is raised in connection with a
motion to dismiss,” we “accept as true all material allegations
of the complaint, and construe the complaint in favor of the
complaining party.” Id. (alteration, citation, and quotation
marks omitted). We also “presume that general allegations
embrace those specific facts that are necessary to support the
claim.” Jewel v. Nat’l Sec. Agency, 673 F.3d 902, 907 (9th
Cir. 2011) (citation and quotation marks omitted). We may
affirm on any proper ground supported by the record.
Hartmann v. Cal. Dep’t of Corr. & Rehab., 707 F.3d 1114,
1121 (9th Cir. 2013).

   A. Standing

    The “irreducible constitutional minimum” of Article III
standing consists of (1) “injury in fact,” (2) “a causal
connection between the injury and the conduct complained
of,” and (3) a likelihood “that the injury will be redressed by
a favorable decision.” Lujan v. Defenders of Wildlife,
504 U.S. 555, 560–61 (1992) (quotation marks omitted).
8                   NOVAK V. UNITED STATES

“The party invoking federal jurisdiction bears the burden of
establishing these elements.” Id. at 561.

         1. Injury in Fact

    “[A]n injury in fact” is “an invasion of a legally protected
interest” that is “concrete and particularized” and “actual or
imminent, not conjectural or hypothetical.” Id. at 560
(quotation marks omitted). Because a generalized grievance
is not a particularized injury, a suit alleging only generalized
grievances fails for lack of standing. Lexmark Int’l, Inc. v.
Static Control Components, Inc., 134 S. Ct. 1377, 1387 n.3
(2014); Lance v. Coffman, 549 U.S. 437, 439–40 (2007) (per
curiam); Newdow v. Rio Linda Union Sch. Dist., 597 F.3d
1007, 1016 (9th Cir. 2010).

    The district court determined that Plaintiffs alleged only
generalized grievances and consequently dismissed their
action for lack of standing.2 In so doing, the district court
mistakenly focused only on the size of the population
allegedly harmed. “[T]he fact that a harm is widely shared
does not necessarily render it a generalized grievance.”
Jewel, 673 F.3d at 909; see also Federal Election Comm’n v.
Akins, 524 U.S. 11, 24 (1998) (recognizing that “where a
harm is concrete, though widely shared, the Court has found
‘injury in fact.’”). Indeed, the instances in which the
Supreme Court has labeled a plaintiff’s claim a “generalized
grievance” “invariably appear[ ] in cases where the harm at
issue is not only widely shared, but is also of an abstract and

    2
     Although the district court framed its analysis under the prudential
standing rubric, the Supreme Court subsequently clarified that the rule
barring adjudication of generalized grievances is really a matter of
constitutional standing under Article III. Lexmark, 134 S. Ct. at 1387 n.3.
                  NOVAK V. UNITED STATES                       9

indefinite nature—for example, harm to the common concern
for obedience to law.” Id. at 23 (citation and internal
quotation marks omitted).

    Plaintiffs’ claim is not a generalized grievance because
the harm they allege is not entirely “of an abstract and
indefinite nature.” Id. Plaintiffs allege in their complaint that
each of them individually suffered “pecuniary injury and
damages as a result of the Jones Act” when they “purchased
domestic ocean cargo shipping services.” This alleged injury
is not the kind of abstract or indefinite harm that the Supreme
Court has held to be insufficient to confer standing. See, e.g.,
Lance, 549 U.S. at 441–42 (holding that plaintiffs lacked
standing because “[t]he only injury [they] allege is that the
law . . . has not been followed”); Allen v. Wright, 468 U.S.
737, 754 (1984) (“This Court has repeatedly held that an
asserted right to have the Government act in accordance with
law is not sufficient, standing alone, to confer jurisdiction on
a federal court.”), abrogated on other grounds by Lexmark
Int’l, 134 S. Ct. 1377; Schlesinger v. Reservists Comm. to
Stop the War, 418 U.S. 208, 217, 219–20 (1974) (holding that
the “generalized interest of all citizens in constitutional
governance . . . is an abstract injury” that is an insufficient
basis for standing).

        2. Causation

    The second required element for Article III standing is
causation. This means that “there must be a causal
connection between the injury and the conduct complained
of.” Lujan, 504 U.S. at 560. “When . . . as in this case, a
plaintiff’s asserted injury arises from the government’s
allegedly unlawful regulation (or lack of regulation) of
someone else, . . . causation and redressability ordinarily
10               NOVAK V. UNITED STATES

hinge on the response of the regulated (or regulable) third
party to the government action or inaction—and perhaps on
the response of others as well.” Id. at 562. “‘[M]ore
particular facts are needed to show standing’” in such cases.
Mendia v. Garcia, 768 F.3d 1009, 1013 (9th Cir. 2014)
(citing Nat’l Audubon Soc’y, Inc. v. Davis, 307 F.3d 835, 849
(9th Cir. 2002)). “That’s so because the third parties may
well have engaged in their injury-inflicting actions even in
the absence of the government’s challenged conduct.” Id.
“To plausibly allege that the injury was not the result of the
independent action of some third party, the plaintiff must
offer facts showing that the government’s unlawful conduct
is at least a substantial factor motivating the third parties’
actions.” Id. (citation and quotation marks omitted).

    We dealt with a somewhat analogous issue in San Diego
County Gun Rights Committee v. Reno, 98 F.3d 1121 (9th
Cir. 1996). In that case, members of various gun rights
groups sued the Attorney General of the United States, as
well as other government officials, challenging the Violent
Crime Control and Law Enforcement Act of 1994 (“VCCA”).
Id. at 1124. The plaintiffs argued, among other things, that
they had standing because they had suffered an economic
injury. Id. at 1130. They asserted that the VCCA had caused
the price of the affected firearms to increase from 40% to
100%. Id. We reasoned that “[a]lthough the [VCCA] may
tend to restrict supply, nothing in the Act directs
manufacturers or dealers to raise the price of regulated
weapons,” and that “[u]nder Lujan, plaintiffs’ injury [did] not
satisfy the requirements of Article III because it [was] the
result of the independent action of some third party not before
the court.” Id.
                  NOVAK V. UNITED STATES                      11

     Here, Plaintiffs suggest that the cabotage provisions of the
Jones Act allowed two companies (not parties to this suit) to
establish a duopoly whereby they are able to dominate the
Hawaii shipping market and charge exorbitant rates.
Plaintiffs’ own complaint, however, also alleges that the
Hawaii shipping market “has several characteristics that made
it easy” for the two shipping companies in that market to keep
prices high, independent of the Jones Act: “market
concentration, significant barriers to entry, ease of
information sharing, lack of viable alternatives to ocean
shipping, and the commodity nature of ocean shipping
services.” In this light, Plaintiffs themselves have alleged
facts showing that the two companies “may well have
engaged in their injury-inflicting actions even in the absence
of the government’s challenged conduct.” Mendia, 768 F.3d
at 1013. This is fatal to Plaintiffs’ effort to allege causation.

        3. Redressability

    The third element of Article III standing, redressability,
requires that it “be likely, as opposed to merely speculative,
that the injury will be redressed by a favorable decision.”
Lujan, 504 U.S. at 561 (citation and internal quotation marks
omitted). Although “[p]laintiffs need not demonstrate that
there is a ‘guarantee’ that their injuries will be redressed by
a favorable decision,” Graham v. Fed. Emergency Mgmt.
Agency, 149 F.3d 997, 1003 (9th Cir. 1998), abrogated on
other grounds by Levin v. Commerce Energy, Inc., 560 U.S.
413 (2010), they do need to “show that there would be a
‘change in a legal status’” as a consequence of a favorable
decision “and that a ‘practical consequence of that change
would amount to a significant increase in the likelihood that
the plaintiff would obtain relief that directly redresses the
injury suffered.’” Renee v. Duncan, 686 F.3d 1002, 1013 (9th
12               NOVAK V. UNITED STATES

Cir. 2012) (citing Utah v. Evans, 536 U.S. 452, 464 (2002)).
There is no standing if, following a favorable decision,
whether the injury would be redressed would still depend on
“the unfettered choices made by independent actors not
before the courts.” ASARCO Inc. v. Kadish, 490 U.S. 605,
615 (1989).

    Here, Plaintiffs have not shown a likelihood that the
shipping companies would lower their prices if the challenged
provisions of the Jones Act were invalidated. On the
contrary, as we have noted, Plaintiffs themselves have alleged
several reasons—“market concentration, significant barriers
to entry, ease of information sharing, lack of viable
alternatives to ocean shipping, and the commodity nature of
ocean shipping services,”—that suggest prices might remain
high even if the Jones Act were invalidated. Indeed,
Plaintiffs allege that the two shipping companies serving the
Hawaii market have engaged in a “conspiracy” to keep prices
high. But, as Plaintiffs acknowledge in their complaint, the
Jones Act “does not permit collusion, market sharing, market
allocation, market manipulation or price fixing.” This
suggests that enjoining enforcement of the Jones Act would
not redress the alleged conspiracy between the shipping
companies. According to Plaintiffs’ own complaint, any such
conspiracy would be the result of “the unfettered choices
made by independent actors not before the courts.” ASARCO,
490 U.S. at 615.

     B. Leave to Amend

    We must next decide whether Plaintiffs should be granted
leave to amend in order to correct the deficiencies we have
identified. Under Rule 15(a) of the Federal Rules of Civil
Procedure, leave to amend a party’s pleading “should [be]
                     NOVAK V. UNITED STATES                             13

freely give[n] . . . when justice so requires,” because the
purpose of the rule is “to facilitate decision on the merits,
rather than on the pleadings or technicalities.” Chudacoff v.
Univ. Med. Ctr. of S. Nev., 649 F.3d 1143, 1152 (9th Cir.
2011) (alterations in original) (citation and quotation marks
omitted). Nevertheless, the “general rule that parties are
allowed to amend their pleadings . . . does not extend to cases
in which any amendment would be an exercise in futility or
where the amended complaint would also be subject to
dismissal.” Steckman v. Hart Brewing, Inc., 143 F.3d 1293,
1298 (9th Cir. 1998) (citations omitted). Futility alone can
justify a court’s refusal to grant leave to amend. See Bonin v.
Calderon, 59 F.3d 815, 845 (9th Cir. 1995).

    We decline to order that leave be granted to amend the
complaint. We conclude that amendment would be an
exercise in futility because even if Plaintiffs established
standing, they would still fail to state a claim.3 Plaintiffs’
claim under the Commerce Clause would not survive a
motion to dismiss because the Commerce Clause does not
limit the authority of Congress to regulate interstate
commerce. By its terms, the Commerce Clause empowers
Congress to “regulate Commerce with foreign Nations, and
among the several States.” U.S. Const. art. I, § 8, cl. 3. As

 3
    Strictly from a standing perspective, it would not necessarily be futile
for Plaintiffs to amend their complaint. Materials outside the record
support the notion that the Jones Act causes economic injury to residents
of Hawaii. See, e.g., U.S. Int’l Trade Comm’n, The Economic Effects of
Significant U.S. Import Restraints xviii (2002) (estimating that the
economic welfare gain from the “complete liberalization of maritime
cabotage services under the Jones Act . . . would be slightly more than
$656 million”). If Plaintiffs cured the deficiencies we have identified in
their complaint, they might well be able to establish Article III standing
to challenge the Jones Act.
14                NOVAK V. UNITED STATES

Plaintiffs themselves acknowledge, the broad power of
Congress has been well established for nearly 200 years, at
least since Gibbons v. Ogden, 22 U.S. 1 (1824). There may
sometimes be debates as to whether a given enactment by
Congress falls within its authority under the Commerce
Clause—debates that might turn on whether the regulated
activity has a sufficient effect on interstate commerce. See,
e.g., Nat’l Fed’n of Indep. Bus. v. Sebelius, 132 S. Ct. 2566,
2587 (2012). But “[t]he commerce clause is in no sense a
limitation upon the power of Congress over interstate and
foreign commerce.” Prudential Ins. Co. v. Benjamin,
328 U.S. 408, 423 (1946).

    Plaintiffs’ complaint is aimed squarely at a regulation of
commerce among the several states, specifically shipping
between Hawaii and the other states. Indeed, Plaintiffs allege
that the Jones Act violates the Commerce Clause because its
cabotage provisions constitute “an unlawful restraint of trade
and interstate commerce.” Thus, they acknowledge that the
regulation at issue here concerns interstate commerce.

     That the regulation may be a “restraint of trade” does not
matter. As noted above, the Commerce Clause does not limit
the power of Congress to regulate interstate commerce. Id.
Quite the opposite, it is well established that, by virtue of the
Commerce Clause, Congress has broad authority to regulate
the channels and instrumentalities of interstate commerce, as
well as any activity substantially relating to interstate
commerce. See, e.g., United States v. Lopez, 514 U.S. 549,
558 (1995); Prudential Ins., 328 U.S. at 423.

   It is true that the purpose of the Commerce Clause is to
encourage and promote interstate commerce. Bos. Stock
Exch. v. State Tax Comm’n, 429 U.S. 318, 328 (1977). But
                    NOVAK V. UNITED STATES                           15

the Supreme Court has made clear that this means the Clause
prevents states from burdening interstate commerce. See
General Motors Corp. v. Tracy, 519 U.S. 278, 287 (1997)
(“The negative or dormant implication of the Commerce
Clause prohibits state taxation or regulation that discriminates
against or unduly burdens interstate commerce and thereby
impedes free private trade in the national marketplace.”)
(citations, alteration, and quotation marks omitted). As to
Congress, however, it is solely a grant of power to regulate
the realm of interstate commerce, not a restriction.4 In
particular, contrary to Plaintiffs’ implied assertion, the
antitrust laws are not written into the Commerce Clause as a
limit on Congress’ power. The Commerce Clause does not
provide a legal basis for Plaintiffs’ claim.

    On appeal, perhaps in tacit recognition that the legal
theory espoused in their complaint was not viable, Plaintiffs
have argued that, even if the Jones Act is a valid exercise of
congressional power derived from the Commerce Clause, it
violates protections guaranteed under the Due Process Clause
of the Fifth Amendment. In the context of the Commerce

  4
      The federal government only has the powers granted to it by the
Constitution. The definition of interstate commerce under the Commerce
Clause thus affects the scope of the authority given Congress by that
clause, and court decisions emphasizing limits on the definition of
interstate commerce are sometimes described as limiting the authority of
Congress. See, e.g., Lopez, 514 U.S. at 566 (“Congress’ authority is
limited to those powers enumerated in the Constitution, and . . . those
enumerated powers are interpreted as having judicially enforceable outer
limits . . . .”). Here, however, there is no dispute that the Jones Act
regulates interstate commerce under any definition, and the Commerce
Clause places no limits on the power of Congress to regulate within that
interstate commerce realm. “[T]he sovereignty of Congress, though
limited to specified objects, is plenary as to those objects.” Gibbons,
22 U.S. at 197.
16                NOVAK V. UNITED STATES

Clause, we have held that “the requirements of due process
are satisfied if the law passed . . . has a reasonable relation to
a legitimate legislative purpose and is not arbitrary,
capricious or discriminatory.” Boylan v. United States,
310 F.2d 493, 498 (9th Cir. 1962). Plaintiffs do not argue
that the Jones Act’s cabotage provisions are not reasonably
related to a legitimate legislative purpose, nor do they assert
that the provisions are arbitrary or capricious.

    Plaintiffs do contend that the Jones Act is discriminatory
because its effects on Hawaii commerce are disproportionate
as compared to the rest of the United States. But that alleged
discrimination does not support a viable cause of action,
whether framed as a matter of due process or as an attempt to
enforce a supposed structural limitation on federal power
under the Commerce Clause. “There is no requirement of
uniformity in connection with the commerce power.” Currin
v. Wallace, 306 U.S. 1, 14 (1939); see also Am. Trucking
Ass’ns v. United States, 344 U.S. 298, 322 & n.20 (1953)
(explaining that the Due Process Clause is not violated even
where a regulatory scheme causes some businesses to fail);
Sec’y of Agric. v. Cent. Roig Ref. Co., 338 U.S. 604, 616–19
(1950) (explaining that legislation did not offend the Due
Process Clause even where it set different quotas for sugar
from refiners in island territories than from refiners on the
mainland, thereby creating inequalities); see generally
Thomas B. Colby, Revitalizing the Forgotten Uniformity
Constraint on the Commerce Power, 91 Va. L. Rev. 249
(2005) (considering historical arguments in favor of an
inherent uniformity constraint on the commerce power, but
recognizing that the Supreme Court has for decades
consistently stated that no such constraint exists).
                 NOVAK V. UNITED STATES                     17

    The closest that Plaintiffs come to identifying legal
support for their due process theory is to quote, in both their
opening brief and their reply brief, from the Supreme Court’s
1939 decision in Currin, specifically the first sentence of the
following paragraph:

       If it be assumed that there might be
       discrimination of such an injurious character
       as to bring into operation the due process
       clause of the Fifth Amendment, that is a
       different matter from a contention that mere
       lack of uniformity in the exercise of the
       commerce power renders the action of
       Congress invalid. For that contention we find
       no warrant. It is of the essence of the plenary
       power conferred that Congress may exercise
       its discretion in the use of the power.
       Congress may choose the commodities and
       places to which its regulation shall apply.
       Congress may consider and weigh relative
       situations and needs.        Congress is not
       restricted by any technical requirement but
       may make limited applications and resort to
       tests so that it may have the benefit of
       experience in deciding upon the continuance
       or extension of a policy which under the
       Constitution it is free to adopt. As to such
       choices, the question is one of wisdom and
       not of power.

Currin, 306 U.S. at 14.        The first sentence might
acknowledge that there could be a due process limitation on
some exercises of power, but it does not support Plaintiffs’
claim that the Jones Act crosses the line. The rest of the
18                NOVAK V. UNITED STATES

paragraph provides the most telling response, especially the
final sentence. It is not for us to evaluate the wisdom of the
Jones Act. That task is for Congress. Congress has the
power to regulate interstate commerce, and it is up to
Congress to decide how to exercise it. As Chief Justice
Marshall stated nearly 200 years ago, “[t]he wisdom and the
discretion of Congress, their identity with the people, and the
influence which their constituents possess at elections, are, in
this, as in many other instances . . . the sole restraints . . . to
secure them from its abuse.” Gibbons, 22 U.S. at 197.

    Likewise, although it is true that “[t]he liberty protected
by the Fifth Amendment’s Due Process Clause contains
within it the prohibition against denying to any person the
equal protection of the laws,” United States v. Windsor,
133 S. Ct. 2675, 2695 (2013), “equal protection is not a
license for courts to judge the wisdom, fairness, or logic of
legislative choices,” FCC v. Beach Commc’ns, Inc., 508 U.S.
307, 313 (1993). Where, as here, rational basis review
applies and “there are plausible reasons for Congress’ action,
our inquiry is at an end.” Id. at 313–14 (quotation marks
omitted). This is not, for instance, a case involving invidious
racial discrimination, e.g., Bolling v. Sharpe, 347 U.S. 497,
500 (1954), or indeed a case of intentional, invidious
discrimination of any kind, see generally Vill. of Arlington
Heights v. Metro. Hous. Dev. Corp., 429 U.S. 252, 265
(1977) (holding that a “discriminatory intent or purpose is
required to show a violation of the Equal Protection Clause”).

    Thus, we decline to order that leave be granted for
Plaintiffs to amend their complaint because, for the reasons
discussed above, it would be futile to do so.
                  NOVAK V. UNITED STATES                      19

       C. Procedural Due Process

    Plaintiffs also assert that the district court violated their
right to procedural due process by ruling on the government’s
motion to dismiss without an oral hearing. We reject this
argument. Plaintiffs admit they “had [an] opportunity to
present arguments counter to Defendant’s motion,” but they
do not explain why that opportunity to present arguments in
writing was inaedquate for purposes of due process. It was
sufficient. See Cleveland Bd. of Educ. v. Loudermill,
470 U.S. 532, 546 (1985) (“The essential requirements of due
process . . . are notice and an opportunity to respond. The
opportunity to present reasons, either in person or in writing,
why [a] proposed action should not be taken is a fundamental
due process requirement.” (emphasis added)). The district
court did not err in ruling on the government’s motion
without an oral hearing.

III.      Conclusion

    Plaintiffs’ complaint fails to make the showing necessary
to establish Article III standing. We affirm the dismissal of
the action and we decline to grant leave to amend the
complaint.

       AFFIRMED.

FRIEDLAND, Circuit Judge, concurring:

    I concur in Judge Clifton’s thoughtful opinion, which
faithfully applies our circuit precedent. I write separately to
express my view that San Diego County Gun Rights
20                NOVAK V. UNITED STATES

Committee v. Reno, 98 F.3d 1121 (9th Cir. 1996), which
drives the opinion’s conclusion that Plaintiffs lack Article III
standing, should be reconsidered in an appropriate case.

     Gun Rights ignores one of the most basic rules of
microeconomics. According to Gun Rights, the fact that a
law “restrict[s] supply” of a good is insufficient to support the
inference that the law causes an increase in the price of that
good. 98 F.3d at 1130. But the law of supply and demand
tells us that, when demand for a good remains constant, a
decrease in the supply of that good will cause an increase in
price. See DAVID BESANKOW & RONALD R. BRAEUTIGAM,
MICROECONOMICS 37 (4th ed. 2010); see also CHARLES
ALAN WRIGHT, ARTHUR R. MILLER & EDWARD H. COOPER,
13A FEDERAL PRACTICE & PROCEDURE § 3531.5 n.35 (3d ed.
2008) (criticizing the causation analysis in Gun Rights for
failing to recognize that “[r]estriction of lawful supply
inevitably increases the price absent a change in the demand
schedule”).

    In accordance with basic economics, plaintiffs should be
able to show that a challenged statute has caused an increase
in price by showing that it has decreased supply. But Gun
Rights prevents plaintiffs from establishing causation in this
manner unless they can show that the statute actually “directs
manufacturers or dealers to raise the price of regulated”
goods. 98 F.3d at 1130. This contravenes the rule that
causation may be indirect: “causation may be found even if
there are multiple links in the chain connecting the
defendant’s unlawful conduct to the plaintiff’s injury.”
Mendia v. Garcia, 768 F.3d 1009, 1012 (9th Cir. 2014). As
long as plaintiffs can show, “without relying on speculation
or guesswork,” that challenged governmental conduct is “at
least a substantial factor” behind an injury, they can establish
                 NOVAK V. UNITED STATES                     21

causation. Id. at 1013. The law of supply and demand
requires no speculation or guesswork, so there should be little
doubt that a statute reducing supply is at least a substantial
factor behind a rise in price.

    Were it not for Gun Rights, I would conclude that
Plaintiffs have standing to challenge the Jones Act. At a
minimum, Plaintiffs allege that the Jones Act limits the
supply of vessels available to serve the Hawaii shipping
market. This alone should be sufficient to establish that the
Jones Act causes prices in that market to be higher than they
otherwise would be. But, regrettably, Gun Rights requires
more.

    That said, this case is a poor vehicle for revisiting Gun
Rights because, as Judge Clifton’s opinion explains, Plaintiffs
have failed to state a claim whether or not they have
established standing. I expect the day will come, however,
when it will be necessary to reconsider how plaintiffs injured
by high prices can show that a defendant’s challenged
conduct caused those prices to increase. When it does, we
should overrule Gun Rights and bring the law of our circuit
into conformity with fundamental principles of economics.