The opinion of the court was delivered by: Irma E. Gonzalez, Chief Judge United States District Court
Order (1) Denying Plaintiff's Motion for Summary Judgment, (2) Granting Federal Defendants' Cross-Motion for Summary Judgment, (3) Granting Defendant-Intervenor Termoelectrica U.S.'s Cross-Motion for Summary Judgment, (4) Granting Defendant-Intervenor Baja California Power's Cross-Motion for Summary Judgment, (5) Granting in Part, Denying in Part All Defendants' Motions To Strike the First Declaration of William E. Powers, (6) Granting in Part, Denying in Part Plaintiff's Motion To Strike the Declaration of Octavio M.C. Simoes, (7) Granting in Part, Denying in Part All Defendants' Motions To Strike the Second Declaration of William E. Powers, (8) Denying Defendant-Intervenor Termoelectrica U.S.'s Motion To Voir Dire William E. Powers, and (9) Denying as Moot All Defendants' Motions To Strike the Declaration of Theodore D. Schade [Doc. Nos. 225, 233, 238, 243, 247, 249, 253, 254, 255, 258]
Presently before the Court are cross-motions for summary judgment filed by the Border Power Plant Working Group ("plaintiff"); Department of Energy, Bureau of Land Management, and agency officials ("federal defendants"); defendant-intervenor Termoelectrica U.S., LLC ("TUS"); and defendant-intervenor Baja California Power, Inc. ("Baja"). Also presently before the Court are the following evidentiary motions: defendants' motions to strike the first and second declarations of William E. Powers, and the declaration of Theodore D. Schade; T-US's motion to voir dire William E. Powers; and plaintiff's motion to strike the declaration of Octavio M.C. Simoes.
I. Factual and Procedural History of the Prior Litigation
The Department of Energy ("DOE") is responsible for issuing Presidential permits for the construction, operation, maintenance, and connection of electric transmission facilities at the United States international border. [D-1076, at 2; D-1077, at 2.*fn2 ] On February 27, 2001, Baja applied to DOE for a Presidential permit to construct a 230-kV transmission line extending from San Diego Gas & Electric Company's Imperial Valley Substation to the U.S.-Mexico border. [D-1077, at 2.] There, the line would connect with transmission facilities in Mexico and extend to the La Rosita Power Complex in Mexicali. [Id.]
On March 7, 2001, Sempra Energy Resources ("SER") applied to DOE for a Presidential permit to construct a 230-kV transmission line that would run parallel to the Baja line. [D-1076, at 2.] At the border, the line would connect with transmission facilities in Mexico and extend to the Termoelectrica de Mexicali power plant.*fn3 The primary purpose of both transmission lines is the importation of power into the United States. [DOE-101, at 13.]
Because of the similarity in the proposals, DOE decided to consider both transmission lines in a single environmental document. [D-1077, at 3.] DOE and BLM (collectively, "agencies") concluded that an environmental assessment ("EA") was the appropriate level of review under the National Environmental Policy Act ("NEPA"). [Id.] On December 1, 2001, the agencies completed the EA, and, based on that document, made a finding of no significant impact ("FONSI"). [DOE-101, DOE-103.] DOE issued the permits on December 5, 2001. [DOE-104, DOE-105.] SER and Baja then began constructing the transmission lines, which commenced operation to export electricity from Mexico in July 2003. [Final Environmental Impact Statement ("FEIS"), Vol. 1, at 1-1.]
On March 19, 2002, plaintiff filed its complaint against DOE, BLM, and agency officials challenging the EA and FONSI. [Doc. No. 1, at 2.] Plaintiff alleged causes of action under NEPA for DOE's failure to prepare an environmental impact statement ("EIS") or to analyze reasonable alternatives. [Id., at 16-19.] The Court granted SER's and Baja's motions to intervene with respect to the remedy phase. [Doc. Nos. 18, 32.] On January 30, 2003, the Court ordered the substitution of T-US for SER.*fn4 [Doc. No. 42.]
On May 2, 2003, applying the "arbitrary and capricious" standard of review under the Administrative Procedure Act ("APA"), 5 U.S.C. § 706(2)(A), this Court partially granted plaintiff's motion for summary judgment as to the EA and FONSI's inadequate analysis on the issues of the potential for controversy, water impacts, impacts of ammonia and carbon dioxide, reasonable alternatives, and cumulative impacts. [Doc. No. 91, at 40.] After denying plaintiff's motion for injunctive relief [Doc. No. 124], the Court remanded to the agencies for preparation of appropriate NEPA documents on July 9, 2003. [Doc. No. 162, at 34.] The Court prohibited the agencies from considering on remand the completion of the transmission lines' construction, their interim operation, or the Court's analysis of the environmental impacts. [Id.]
II. Factual and Procedural History of the Present Litigation
On October 24, 2003, DOE issued a Notice of Intent to prepare an EIS. [D-0059, at 1.]
Pursuant to the Court's remand Order, the agencies "conduct[ed] their NEPA review from a fresh slate, i.e., as if the transmission lines did not exist." [Id., at 8.] On May 11, 2004, DOE published notice in the Federal Register that the Draft EIS was available. [D-0702.] DOE originally provided a forty-five day period to comment on the Draft EIS, and extended the comment period by one month at plaintiff's request. [D-0717, at 1.]
On December 10, 2004, the agencies issued the FEIS and filed it with the Environmental Protection Agency. [Fed. Defs. Memo. ISO Motion, at 3; D-1069, at 1.] The FEIS contained a separate volume of comments received during the review period--including the transcripts of two public hearings--along with DOE's responses to those comments. [See FEIS Vol. 2.] On April 18, 2005, DOE issued new permits to Baja and T-US. [D-1076; D-1077.]
On April 25, 2005, DOE published the ROD in the Federal Register. [D-1085.] The ROD explained what alternatives DOE had considered: (1) no action; (2) granting one or both permits with corresponding right(s)-of-way, based on the current design of the Mexicali power plants ("proposed action"); (3) granting one or both permits with corresponding right(s)-of-way, with more stringent emissions controls and alternative cooling technologies installed at the Mexicali power plants; and (4) granting one or both permits with corresponding right(s)-of-way, with off-site mitigation measures implemented to minimize domestic environmental impacts. [Id., at 3.] On May 27, 2005, the federal defendants notified the Court that the agencies had completed the FEIS and issued new RODs. [Doc. No. 179.]
On August 18, 2005, pursuant to the parties' stipulation, the Court ordered the filing of plaintiff's first amended complaint ("FAC"). [Doc. No. 181, at 4.] The FAC alleges six (6) causes of action: one under the Clean Air Act ("CAA"), four under NEPA, and one under the APA.
The first cause of action alleges that, based on data in the FEIS, the total number of direct and indirect emissions of pollutants in Imperial County caused by DOE's permitting actions exceeds regulatory thresholds. Therefore, plaintiff alleges the federal defendants violated the CAA by failing to conduct a conformity determination to ensure that the permits conform to California's state implementation plan for Imperial County.
In its opening brief, plaintiff voluntarily dismissed its second cause of action under NEPA for failure to evaluate cumulative impacts adequately.*fn5 [Pl. Memo. ISO Motion, at 34 n.23.]
The third cause of action alleges a NEPA violation for failure to evaluate alternatives adequately. Plaintiff specifically alleges DOE failed to evaluate adequately certain alternative technologies, such as wet-dry cooling, that would minimize adverse environmental impacts and still satisfy the purpose and need for the project. Although DOE included a section on alternative technologies in the FEIS, the analysis was so "skewed" by inaccurate information that the alternatives were "never fairly presented to the public or the decisionmakers." [FAC ¶ 42.] Also, when preparing the FEIS, DOE assumed the power plants were already built and operating. Plaintiff alleges this assumption violated the Court-ordered prohibition against the federal defendants' consideration of the interim operation of the transmission lines or the completion of construction. [Id. ¶ 41 (quoting Doc. No. 162, at 33).]
The fourth cause of action alleges a violation of NEPA regulations for failure to ensure the scientific accuracy of relied-upon information. Specifically, in recommending against retrofitting the Mexicali power plants with wet-dry cooling technology, DOE failed to rely on high-quality data or accurate information about the appropriate design and cost of a wet-dry cooling system. DOE further failed to rely on accurate information in its analysis of the environmental impacts of a wet-dry cooling system, including the potential water savings and corresponding reductions in plant efficiency.
The fifth cause of action alleges a NEPA violation for inadequate analysis of mitigation measures. While the ROD states the proposed action would be implemented without any mitigation, plaintiff alleges the ROD's explanation of the decision not to mitigate is legally insufficient.
The sixth cause of action alleges an APA violation for the defendants' "arbitrary and capricious" agency action. Plaintiff specifically alleges defendants' underlying violations of CAA and NEPA are unlawful agency actions that the APA requires a reviewing court to set aside.
As remedies, plaintiff requests a declaratory judgment that (1) the permits were issued in violation of the CAA, (2) the FEIS and ROD did not comply with NEPA, and (3) defendants violated the APA. Plaintiff also petitions the Court to (1) set aside the permits, (2) enjoin operation of the transmission lines, or, (3) in the alternative, require mitigation measures to offset air and water quality impacts--all pending completion of a CAA-compliant conformity determination and a NEPA-compliant EIS and ROD.
On October 12, 2005, the Court granted T-US' and Baja's motions to intervene in all phases of the case. [Doc. No. 194.]
On October 18, 2005, the federal defendants answered the FAC. [Doc. No. 195.] On November 1, 2005, T-US and Baja each answered the FAC. [Doc. Nos. 197-98.]
On February 8, 2006, the Court denied defendant-intervenors' motion to dismiss plaintiff's first cause of action. [Doc. No. 214.] The Court found defendant-intervenors did not "cite any persuasive authority categorically exempting the emissions from the Mexican power plants from analysis under the conformity provisions of the CAA because they occur outside Imperial County." [Id., at 6-7.] In the absence of said authority, the Court then construed the definition of "indirect emissions" to include the emissions from the Mexican power plants. [Id. at 10-16.]
On March 29, 2006, the Court denied plaintiff's motion to bar all defendants from further litigation on summary judgment of issues resolved in the Order denying the motion to dismiss. [Doc. No. 224.] The Court found the "law of the case" doctrine inapplicable because its findings on the motion to dismiss were "not the type of concrete determinations that would ordinarily bar further litigation of such issues[.]" [Id., at 5.]
The Court adopted a briefing schedule for summary judgment motions on February 24, 2006. [Doc. No. 218.] On April 14, 2006, plaintiff filed its motion for summary judgment, accompanied by the declarations of William E. Powers and William R. Stockwell. [Doc. Nos. 225, 227-28.] On June 15, 2006, T-US filed its cross-motion for summary judgment, along with the declarations of Octavio M.C. Simoes and Alberto Abreu. [Doc. Nos. 233, 236-37.] That same day, Baja also filed its own cross-motion for summary judgment, accompanied by the declaration of Perry H. Fontana. [Doc. Nos. 239-40.] Finally, federal defendants filed their cross-motion for summary judgment nunc pro tunc to the same date. [Doc. No. 243.]
On August 15, 2006, plaintiff filed its reply in opposition, accompanied by the declaration of Theodore D. Schade and the second declaration of William E. Powers. [Doc Nos. 244-46.] On September 15, 2006, T-US and Baja separately filed their replies. [Doc. No. 259 (Baja); Doc. No. 261 (T-US).] On September 18, 2006, federal defendants filed their reply. [Doc. No. 257.]
On October 6, 2006, the Court held oral argument on the motions for summary judgment and the motions to strike,*fn6 and took these motions under submission.
Before the Court addresses the parties' legal claims, it must determine what evidence beyond the record is admissible in deciding those claims. Therefore, the Court begins by addressing the parties' motions to strike.
I. Expert Testimony of William E. Powers
William E. Powers is a professional mechanical engineer and the chairperson of plaintiff's organization. [First Powers Decla. ¶ 1.] In its motion to strike both Powers declarations, T-US argues that Powers is not an expert. T-US explains that Powers does not have a graduate degree in engineering and has experience only in the emissions testing aspects of power plant operations, but not cooling technologies.*fn7 T-US further alleges that Powers's conclusions are inaccurate because Powers never visited the actual power plants to which the transmission lines are connected.
Where "specialized knowledge will assist" the Court in understanding evidence, a qualified expert witness may offer opinion testimony, "if (1) the testimony is based upon sufficient facts or data, (2) the testimony is the product of reliable principles and methods, and (3) the witness has applied the principles and methods reliably to the facts of the case." Fed. R. Evid. 702. The district court enjoys great discretion in determining whether the expert's testimony is reliable.*fn8
Kumho Tire Co. v. Carmichael, 526 U.S. 137, 152 (1999). Applying that discretion to this case, the Court finds Powers is qualified to testify as an expert. Powers co-authored a presentation on dry-cooling systems at an EPA symposium with Ralph Wyndrum.*fn9 [Second Powers Decla. ¶ 1 & n.1.] He has made presentations on cooling technologies at conferences sponsored by the California Energy Commission. [Id.; see Daubert v. Merrill Dow Pharm., Inc., 509 U.S. 579, 593-94 (stating that peer review and "submission to the scrutiny of the scientific community" are "pertinent consideration[s]" in determining the validity of an expert's opinion).] He has served as an expert witness on power plant cooling in administrative law cases.*fn10 Taken together, Powers's experience satisfies the Court that he meets the qualifications of an expert. T-US's remaining objections are focused on Powers's conclusions, and this Court cannot consider the expert's conclusions in the threshold determination of reliability.*fn11 See Daubert, 509 U.S. at 595 ("The focus, of course, must be solely on principles and methodology, not on the conclusions that they generate.").
II. Extra-Record Evidence
In reviewing a claim under the APA, "the focal point for judicial review should be the administrative record already in existence, not some new record made initially in the reviewing court." Fla. Power & Light Co. v. Lorion, 470 U.S. 729, 743 (1985) (quoting Camp v. Pitts, 411 U.S. 138, 142 (1973)). A court may not consider evidence outside the record to determine whether the agency made the correct decision. Asarco, Inc. v. U.S. Envtl. Prot. Agency, 616 F.2d 1153, 1160 (9th Cir. 1980); Ctr. for Biological Diversity v. Fed. Highway Admin., 290 F. Supp. 2d 1175, 1200-01 (S.D. Cal. 2003). However, the district court may go beyond the record when such evidence helps to explain the agency's action. Animal Def. Council v. Hodel, 840 F.2d 1432, 1436 (9th Cir. 1988), amended by 867 F.2d 1244 (9th Cir. 1989). Specifically, extra-record evidence is admissible if any of these "narrow exceptions" applies: "(1) if admission is necessary to determine whether the agency has considered all relevant factors and has explained its decision, (2) if the agency has relied on documents not in the record, (3) when supplementing the record is necessary to explain technical terms or complex subject matter, or (4) when plaintiffs make a showing of agency bad faith." Nw. Envtl. Advocates v. Nat'l Marine Fisheries Serv., 460 F.3d 1125, 1145 (9th Cir. 2006) (quoting Lands Council v. Powell, 395 F.3d 1019, 1030 (9th Cir. 2005)) (other internal quotations omitted). The first and third exceptions are potentially applicable to these facts.
B. First Declaration of William E. Powers
Plaintiff acknowledges the frequency of Powers's participation during the comment period, identifying at least six documents Powers submitted for the record. [Pl. Opp. to Fed. Defs. Motion To Strike First Powers Decla., at 7-8.] Furthermore, plaintiff repeatedly argues that the information in the First Powers Declaration was contained in the record. [Id., at 1, 7-8.] A court may strike extra-record evidence consisting of information that "already exists in the record" or "[is] extracted from the record." Sw. Ctr. for Biological Diversity v. U.S. Forest Serv., 100 F.3d 1443, 1451 (9th Cir. 1996). The federal defendants argue the First Powers Declaration falls into a Catch-22: either the contents of the declaration are already in the record, or they provide "new, belated criticism" of the agencies' substantive conclusions, and are inadmissible in either case. [Fed. Defs. Reply ISO Motion To Strike First Powers Decla., at 6-7.]
However, under the federal defendants' argument, any challenge to an agency's decision-making process could be construed as an impermissible challenge to its substantive conclusions. Such a construction would leave no room for the established exception allowing courts to consider extra-record evidence where necessary to determine if the agency has considered all relevant factors and explained its decision. The Ninth Circuit recently invoked this exception when it admitted a declaration discussing measurement errors in an FEIS's analysis of tree mortality rates. Earth Island Inst. v. U.S. Forest Serv., 442 F.3d 1147, 1162-63 (9th Cir. 2006). The declaration established the FEIS was "misleading" because the FEIS did not accurately report the findings of the studies it purportedly relied upon. Id. at 1166-67; cf. Hodel, 840 F.2d at 1437 (where information appears in the administrative record, evidence would still be admissible unless explicitly discussed in the EIS); Friends of the Payette v. Horseshoe Bend Hydroelectric Co., 988 F.2d 989, 997 (9th Cir. 1993) (extra-record evidence admissible "[w]hen a failure to explain action frustrates judicial review").
Because of the similar allegations in this case, the Court finds it appropriate to admit portions of the First Powers declaration. For example, the declaration discusses potentially relevant factors--including the existence of power plants of similar sizes in similar climates with dry-cooling systems--that the agency allegedly failed to consider. The declaration also discusses problems in the agency's reasoning--including purportedly incorrect assumptions about the design of the dry-cooling system the power plants could feasibly accommodate--that could potentially call into doubt whether the agency adequately explained its decision.
Furthermore, the subject matter of this case is highly complex and technical. The NEPA causes of action center largely on the engineering design of the cooling system at the power plants. When the federal defendants argue that "the vast majority of the Powers Declaration" improperly goes to Powers's substantive disagreement with the FEIS, they impliedly concede that some portion of the First Powers Declaration would help the Court understand the technical issues in this case. In the first declaration, Powers explains the operation of various types of power plants and their water demands.
Nonetheless, certain paragraphs of the First Powers Declaration clearly do not fall within any of the established exceptions to the rule against extra-record evidence. Therefore, the Court strikes these paragraphs of the First Powers Declaration for the reasons stated:
Paragraph 12 states that T-US's corporate parent, Sempra Energy, asked its cooling vendor to submit a proposed wet-dry cooling system to DOE based on unrealistic assumptions. Criticizing the quality of data submitted by another commenter is not a proper reason to admit extra-record evidence.
Paragraph 14 describes the agreement of the parties on the unit cost of a dry cooling system. Plaintiff does not allege that the agencies failed to consider this factor, nor is this a highly technical computation. For similar reasons, the Court strikes paragraph 15, which discusses the potential costs to ratepayers of a wet-dry cooling system, and paragraph 18, which discusses the parties' agreement on the cost of a new surface condenser.
Paragraph 22 improperly objects to DOE's decision on the merits. It does not object to DOE's decision-making process; any comments directed to the process are duplicative of comments in other paragraphs the Court finds admissible.
Paragraphs 24-27 discuss the feasibility of conducting a CAA conformity determination. Whether the agencies must conduct a conformity determination is a question of law not implicating complex or technical facts. Because the CAA conformity determination is legally separate from the NEPA analysis, the evidentiary exception for the agency's consideration of relevant factors and explanation of its decision does not apply.
C. Declaration of Octavio M.C. Simoes
Octavio M.C. Simoes is a registered professional engineer and the Vice President of Asset Management for Sempra Generation. [Simoes Decla. ¶¶ 2, 4.] He oversaw development and construction of the Mexicali power plant to which the T-US transmission line connects. [Id. ¶ 4.] T-US submitted Simoes' declaration because, "[t]o the extent the Court considers the Powers' declaration, it should likewise consider the Simoes Declaration." [T-US Opp. to Pl.'s Mot. & Memo. ISO Cross-Mot., at 4 n.4.]
Plaintiff moves to strike the Simoes Declaration because it purportedly amounts to an "impermissible post hoc rationalization of an agency decision, made in response to litigation." See Kunaknana v. Clark, 742 F.2d 1145, 1149 (9th Cir. 1984) (holding that such rationalizations are generally inadmissible, and, even when admissible, must not articulate a new rationalization). Plaintiff views the Simoes declaration as a backdoor attempt to patch up gaps in the FEIS's reasoning exposed by this litigation and the First Powers Declaration.
The Court finds, instead, that portions of the Simoes Declaration fall within the well-established exception allowing supplementation of the record "to permit explanation or clarification of technical terms or subject matter involved in the agency action under review."*fn12
Pub. Power Council v. Johnson, 674 F.2d 791, 794 (9th Cir. 1982). Among the documents available to the Court, the Simoes Declaration provides the clearest explanation of such technical terms as "duct firing," "efficiency penalty," and "parallel cooling system."
What plaintiff characterizes as "post hoc rationalization" is, in most cases, a response to the information introduced in the First Powers Declaration. The Simoes Declaration explains, for example, that the Sempra Generation plant is actually distinguishable from the purportedly similar power plants discussed in the First Powers Declaration. In other words, whereas the First Powers Declaration suggested that other power plants are "relevant factors" the agencies should have considered, the Simoes Declaration establishes that those plants are irrelevant to the agencies' decision regarding the Sempra Generation plant because the Sempra Generation plant is different. See Earth Island Institute, 442 F.3d at 1163-64 (where Ninth Circuit allowed plaintiff to introduce an extra-record declaration to show that agency did not consider all relevant factors, agency was allowed to introduce responsive declaration in rebuttal). And, the difference between power plants is itself the kind of complex subject matter for which courts consider supplemental evidence.
Nonetheless, certain paragraphs of the Simoes Declaration clearly do not fall within any of the established exceptions to the rule against extra-record evidence. Therefore, the Court strikes these ...