United States District Court, E.D. California
US CITRUS SCIENCE COUNCIL; SANTA PAULA CREEK RANCH; CPR FARMS; GREEN LEAF FARMS, INC.; BRAVANTE PRODUCE; and RICHARD BAGDASARIAN, INC., Plaintiffs,
THE UNITED STATES DEPARTMENT OF AGRICULTURE; SONNY PERDUE, Secretary of Agriculture; and KEVIN SHEA, Administrator, Animal and Plant Health Inspection Service, Defendants.
MEMORANDUM DECISION AND ORDER DENYING PLAINTIFFS'
MOTION FOR SUMMARY JUDGMENT, AND GRANTING DEFENDANTS'
CROSS-MOTION FOR SUMMARY JUDGMENT ECF NOS. 35, 37
LAWRENCE J. O'NEILL UNITED STATES CHIEF DISTRICT JUDGE.
U.S. Citrus Science Council, Santa Paula Creek Ranch, CPR
Farms, Green Leaf Farms, Inc., Bravante Produce, and Richard
Bagdasarian, Inc. (collectively, “Plaintiffs”)
bring this action against Defendants United States Department
of Agriculture (“USDA”), Sonny Perdue, Secretary
of Agriculture, and Kevin Shea, Administrator, Animal and
Plant Health Inspection Service (“APHIS”)
(collectively, “Defendants” or the
“Government”), to challenge a rule lifting the
ban on lemons imported from Argentina (the “Rule”
or “Final Rule”). Both parties move for summary
judgment. This matter is suitable for disposition without
oral argument. See Local Rule 230(g). For the
reasons set forth below, Plaintiffs' motion for summary
judgment is DENIED, and Defendants' cross-motion for
summary judgment is GRANTED.
Plant Protection Act
Plant Protection Act (“PPA”) authorizes the
Secretary of the USDA to issue regulations “to prevent
the introduction of plant pests into the United States or the
dissemination of plant pests within the United States.”
7 U.S.C. § 7711(a). The Secretary delegated that
authority to the Animal and Plant Health Inspection Service
(“APHIS”), an agency within USDA. 7 C.F.R.
§§ 2.22(a), 280(a)(36). Pursuant to the PPA, APHIS
has issued a number of regulations regarding the conditions
under which fruits and vegetables can be imported into the
Regulatory Flexibility Act
Regulatory Flexibility Act (“RFA”) requires that
agencies issuing rules under the Administrative Procedure Act
(“APA”) publish a final regulatory flexibility
analysis assessing the negative impact of the rule on small
businesses. 5 U.S.C. §§ 603, 604. However, the
agency does not need to engage in flexibility analysis if the
agency head certifies that the rule will not have a
significant economic impact on a substantial number of small
entities. 5 U.S.C. § 605(b).
analysis must meet certain statutory requirements. It must
state the purpose of the relevant rule and the estimated
number of small businesses that the rule will affect, if such
an estimate is available. In addition, each analysis must
summarize comments filed in response to the agency's
initial regulatory flexibility analysis, along with the
agency's assessment of those comments. Finally, each
analysis must include “a description of the steps the
agency has taken to minimize the significant economic
impact” that its rule will have on small businesses,
“including a statement of the factual, policy, and
legal reasons for selecting the alternative adopted in the
final rule and why each one of the other significant
alternatives to the rule considered by the agency which
affect the impact on small entities was rejected.”
1947, regulations under the PPA and its predecessor statutes
have barred the importation of lemons and other citrus from
Argentina. See 7 C.F.R. § 319.28(a)(1)-(3)
(2015). In 2000, APHIS promulgated a rule lifting the ban on
importing lemons from Argentina, but the regulation was
vacated in 2001 because this Court concluded that APHIS
relied on faulty assumptions in completing its pest risk
assessment. See Harlan Land Co. v. U.S. Dep't of
Ag., 186 F.Supp.2d 1076 (E.D. Cal. 2001).
2016, APHIS proposed a new regulation permitting the
importation of lemons from northwest Argentina.
Importation of Lemons from Northwest Argentina, 81
Fed. Reg. 28, 758 (May 10, 2016) (“Proposed
Rule”). The Proposed Rule acknowledged the presence of
certain pests affecting citrus crops in Argentina, but
posited that the risk of pests could be effectively mitigated
by the use of a “systems approach.” Id.
The “systems approach” outlined procedures
intended to ensure the safety of imported lemons, including
the responsibilities of the Argentine government's
inspection agency (“SENASA”), preventative
measures required by Argentine growers, mitigation measures
required by Argentine lemon packinghouses, and APHIS's
role in overseeing and inspecting imported lemons.
Id. at 28, 759-28, 761.
Proposed Rule was accompanied by an initial regulatory
flexibility analysis. Id. at 28, 762-28763. The
analysis estimated that between 15, 000 and 20, 000 metric
tons of fresh lemons would be imported from Argentina
annually, causing the price of fresh lemons to drop between
2% and 4%. Id. at 28, 762. It predicted a
corresponding loss to California and Arizona lemon growers
between $10.9 and $22 million each year. Id. at 28,
762. The analysis concluded that the “[e]conomic
effects of the rule for both producers and consumers are not
expected to be significant.” Id.
period of notice and comment, APHIS published its Final Rule
governing the importation of Argentine Lemons.
Importation of Lemons From Northwest Argentina, 81
Fed. Reg. 94, 217 (Dec. 23, 2016) (codified at 7 C.F.R.
§ 319.56-76) (“Final Rule”). In the Final
Rule, APHIS concluded that it would allow the importation of
fresh lemons from northwest Argentina, subject to conditions
and requirements articulated in the Final Rule. Id.
The Final Rule was scheduled to go into effect on January 23,
2017, but was postponed until May 26, 2017. See
Importation of Lemons From Northwest Argentina: Stay of
Regulations, 82 Fed. Reg. 8353 (Jan. 25, 2017);
Importation of Lemons From Northwest Argentina: Stay of
Regulations, 82 Fed. Reg. 14, 987 (Mar. 24, 2017). On
May 1, 2017, USDA issued a Stakeholder Announcement
indicating that the previously issued Final Rule would go
into effect on May 26, 2017, and announcing that “[f]or
2017 and 2018, Argentine lemons would be imported only into
the northeastern United States.” See USDA,
APHIS Will Not Extend Stay on Import Regulations for
Lemons from Northwest Argentina (May 1, 2017),
On August 17, 2017, representatives from APHIS, SENASA, and
the Argentine lemon industry signed the final operational
workplan, which set forth additional details and procedures
for implementing the day-to-day operations of the Rule.
See Administrative Record (“AR”)
28340. The Rule is now effective, see 7
C.F.R. § 319.56-76, although Plaintiffs indicate that
imports will begin “in full” in March 2018, ECF
No. 40 at 1-2.
filed the instant lawsuit on May 17, 2017, challenging the
Final Rule and the Amendment promulgated by APHIS under the
PPA, APA, National Environmental Policy Act
(“NEPA”), and RFA. (ECF No. 2.) Plaintiffs
brought six counts in the First Amended Complaint: failure to
disclose for public comment data, notes, or a trip report for
the 2015 harvest season site visit under the PPA and APA
(Count I); failure to consider properly SENASA's failed
history, and unjustified reliance on SENASA workplan under
the PPA and APA (Count II); failure to use notice and comment
procedures to amend, and failure to provide reasoned
decision-making in amending, the rule to restrict importation
to northeastern ports under the PPA and APA (Count III);
failure to provide reasoned decision-making under the APA
(Count IV); failure to comply with NEPA (Count V); and
failure to comply with the RFA (Count VI). Defendants
previously moved to dismiss the FAC on the basis that
Plaintiffs lacked standing. The Court dismissed Count III,
but concluded that Plaintiffs had standing to pursue Counts
I, II, IV, V, and VI. ECF No. 36 (“October 25
Order”). Both parties now move for summary judgment on
all remaining claims. (ECF Nos. 35, 37.)
Court has federal question jurisdiction pursuant to 28 U.S.C.
§§ 1331, 1361, and 2201-2202, as well as the APA, 5
U.S.C. §§ 701-706, and the RFA, 5 U.S.C. §
611. Venue is proper in this Court and the matter is ripe for
STANDARD OF DECISION
remedy for challenging an agency's decision not to
authorize testimony is a separate action in federal court
pursuant to the APA. See In re Boeh, 25 F.3d 761,
764 n.3 (9th Cir. 1994). In an action brought pursuant to the
APA, a reviewing court may “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).
“It is well established that once an agency has taken
final agency action under the APA, a reviewing court analyzes
that decision under the ‘arbitrary and capricious'
standard of review.” Mt. St. Helens Mining &
Recovery Ltd. P'ship v. United States, 384 F.3d 721,
727 (9th Cir. 2004) (citations omitted).
the arbitrary and capricious standard, a reviewing court must
determine whether an agency's decision was based on a
consideration of the relevant factors and whether there has
been a clear error of judgment.” Mt. St.
Helens, 384 F.3d at 728 (citation omitted). “This
standard is narrow and [a reviewing court] may not substitute
[its] judgment for that of the agency. Applying the arbitrary
and capricious standard, [the] court must determine whether
the agency articulated a rational connection between the
facts and the choice made.” Id. (citations
omitted). “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.” Ranchers Cattlemen Action Legal Fund
v. U.S. Dep't of Agric., 499 F.3d 1108, 1115 (9th
Cir. 2007) (quotations omitted). “In its paradigmatic
statement of this standard, the Supreme Court explained that
an agency violates the APA if it has ‘relied on factors
which Congress has 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
the evidence before the agency, or is so implausible that it
could not be ascribed to a difference in view or the product
of agency expertise.'” Id. (quoting
Motor Vehicle Mfrs. Ass'n v. State Farm Mut. Auto.
Ins. Co., 463 U.S. 29, 43 (1983)).
substantive challenges, however, . . . . review of an
agency's procedural compliance is exacting, yet
limited.” Kern Cty. Farm Bureau v. Allen, 450
F.3d 1072, 1076 (9th Cir. 2006). The reviewing court
determines “the adequacy of the agency's notice and
comment procedure, without deferring to an agency's own
opinion of the . . . opportunities it provided.”
Natural Res. Def. Council v. EPA, 279 F.3d 1180,
1186 (9th Cir. 2002).
the APA, the district court's review of an agency's
decision is usually limited to the administrative record. 5
U.S.C. § 706; see also Cnty. of Los Angeles v.
Shalala, 192 F.3d 1005, 1011 (D.C. Cir. 1999) (when
reviewing final agency action, the district court is not
managing a “garden variety civil suit, ” but
rather “sits as an appellate tribunal”).
Therefore the usual “genuine dispute of material
fact” standard for summary judgment normally does not
apply in an APA case. San Joaquin River Group Auth. v.
Nat'l Marine Fisheries Serv., 819 F.Supp.2d 1077,
1083-84 (E.D. Cal. 2011). Put another way, in the context of
reviewing an administrative decision under the APA, there are
normally no “disputed facts that the district court
must resolve.” Occidental Eng'g Co. v.
I.N.S., 753 F.2d 766, 769 (9th Cir. 1985). “[T]he
function of the district court is to determine whether or not
as a matter of law the evidence in the administrative record
permitted the agency to make the decision it did.”
Id.; see also City & Cnty. of San Francisco v.
United States, 130 F.3d 873, 877 (9th Cir. 1997).
“[S]ummary judgment is an appropriate mechanism for
deciding the legal question of whether the agency could
reasonably have found the facts as it did.”
Occidental, 753 F.2d at 770. Summary judgment is
proper if the movant shows “there is no genuine dispute
as to any material fact and the movant is entitled to
judgment as a matter of law.” Fed.R.Civ.P. 56(a).
Court's Article III jurisdiction “depends on the
existence of a ‘case or controversy.'”
GTE California, Inc. v. FCC, 39 F.3d 940, 945 (9th
Cir. 1994). “To enforce Article III's limitation of
federal jurisdiction to ‘cases and controversies,
Plaintiffs must demonstrate . . . standing.'”
Nelson v. Nat'l Aeronautics and Space Admin.,
530 F.3d 865, 873 (9th Cir. 2008). To satisfy the
Constitution's standing requirement, “a plaintiff
must show (1) it has suffered an ‘injury in fact'
that is (a) concrete and particularized and (b) actual or
imminent, not conjectural or hypothetical; (2) the injury is
fairly traceable to the challenged action of the defendant;
and (3) it is likely, as opposed to merely speculative, that
there injury will be redressed by a favorable
decision.” Friends of the Earth, Inc. v. Laidlaw
Envt'l Servs., Inc., 528 U.S. 167, 180-81 (2000);
Spokeo, Inc. v. Robbins, 136 S.Ct. 1540, 1547
(2016); Lujan v. Defenders of Wildlife, 504 U.S.
555, 560 (1992).
addition, where an organization or association is bringing
suit on behalf of its members, that organization or
association must demonstrate that: (1) at least one of its
members would otherwise have standing to sue in their own
right; (ii) the interests it seeks to protect are germane to
the organization's purpose; and (iii) neither the claim
asserted nor the relief requested requires the participation
of individual members in the lawsuit. Friends of the
Earth, Inc. v. Laidlaw Envtl. Servs. (TOC), Inc., 528
U.S. 167, 181 (2000).
Court previously determined that Plaintiffs had Article III
standing under the doctrines of competitive and environmental
standing to bring their claims in Counts I, II, IV, V, and
VI. ECF No. 36. The Court further concluded that Plaintiffs
had statutory authority under the RFA to pursue Count IV.
Id. at 19-21. In their motion for summary judgment,
Defendants ask the Court to reconsider Plaintiffs'
standing, arguing that, in light of the complete
administrative record, Plaintiffs have not established
economic or environmental injuries. Plaintiffs also argue
that the Court erred in determining that Plaintiffs have
standing as indirectly regulated entities under the RFA. The
Court addresses that argument separately below.
Infra at 30.
respect to Defendants' renewed arguments about
competitive standing, the Court is persuaded that its initial
reasoning was correct. See ECF No. 36 at 7-12.
According to Defendants, Plaintiffs' declarations in
support of their motion for summary judgment suggest that
there is an attenuated chain of causation between Argentine
lemon imports and competitive injury to domestic growers that
rests on “speculative contingencies.” The Court
disagrees. Its initial conclusion that the Rule caused injury
to domestic lemon growers was based primarily on APHIS's
own conclusions about likely economic harm to
domestic lemon growers. See ECF No. 36 at 10
(“APHIS's own predictions show that the increase in
supply will lead to a drop in price relative to what the
price would otherwise be, and predicts that domestic lemon
growers will suffer millions of dollars of economic loss as a
result”); see also AR16-17, 28, 30. The other
arguments raised by Defendants were previously considered and
rejected by the Court. Plaintiffs have economic injury sufficient
for Article III standing based on a theory of competitor
the record also supports a finding that Plaintiffs have
suffered a non-speculative environmental injury, giving rise
to environmental standing. The Pest Risk Assessment conducted
by APHIS identified no fewer than seven quarantine pests that
would have the potential to be introduced to the United
States through exported fruit. AR106-107. Defendants argue
that the risk of such pests establishing in the United States
is speculative, but that conclusion is contradicted by
APHIS's own Pest Risk Assessment. It is undisputed that
the unregulated import of Argentine lemons would pose a risk
to domestic citrus. The question, therefore, is whether that
risk is adequately addressed by the regulation. Whether the
systems approach described in the Final Rule is an arbitrary
and capricious exercise of APHIS's judgment - or whether
it sufficiently mitigates the risks of any quarantine pest
establishing on domestic soil - is a question that is bound
up in the merits of this case. See ECF No. 36 at 15
(“The ‘likelihood and extent of impact' of
the alleged environmental harm are questions should be
addressed with the merits” (quoting Save Our
Heritage, Inc. v. FAA, 269 F.3d 49, 56 (1st Cir.
2001))). The Court will not import a merits determination
into the standing analysis. See Rosales v. United
States, 824 F.2d 799, 802-03 (9th Cir. 1987).
APHIS's own pest assessment adequately establishes a risk
giving rise to environmental injury and standing.
Procedural Challenges to the Rulemaking
2015 Trip Report
argue that APHIS failed to satisfy its obligations to use
“transparent and accessible”
“processes” under the PPA, 7 U.S.C. § 7712,
and to comply with notice and comment procedures under the
APA, 5 U.S.C. § 553, by concealing a report detailing
APHIS's 2015 trip to Argentina (“2015 Trip
Report”) until after the close of public comment.
Defendants counter that the report was not critical to
APHIS's decision, and that the material contained in it
was otherwise known and subject to public comment. Therefore,
Defendants argue, the non-disclosure was not material.
Defendants further contend that the non-disclosure of the
2015 Trip Report is not a cognizable procedural
challenge to the Final Rule, but is instead a substantive
challenge masquerading as a procedural one.
agency is obligated to “identify and make available
technical studies and data that it has employed in reaching
the decisions to propose particular rules.” Kern
Cty. Farm Bureau v. Allen, 450 F.3d 1072, 1076 (9th Cir.
2006). However, “the public is not entitled to review
and comment on every piece of information utilized during
rule making.” Id. “Instead, an agency,
without reopening the comment period, may use
‘supplementary data, unavailable during the notice and
comment period, that expands on and confirms information
contained in the proposed rulemaking and addresses alleged
deficiencies in the pre-existing data, so long as no
prejudice is shown.'” Id. (quoting
Idaho Farm Bureau Fed'n v. Babbitt, 58 F.3d
1392, 1402 (9th Cir. 1995)).
undisclosed 2015 Trip Report contained information critical
to the agency's determination that was also “unique
information that was not duplicated in other reports, ”
the nondisclosure deprived Plaintiffs and others of the
opportunity for public comment, and the agency determination
should be reversed and the comment period reopened. Idaho
Farm Bureau Fed'n, 58 F.3d at 1403; Kern Cty.
Farm Bureau, 450 F.3d at 1074. If, however, the report
provided only “supplementary” data that
“‘expand[s] on and confirm [s]' information
contained in the proposed rule[ ] and “did not alter
the justifications or conclusions that were vital to the
listing decision, ” there was no procedural error in
not publishing it. Kern Cty. Farm Bureau, 450 F.3d
contend that the information in the 2015 Trip Report was
critical because APHIS needed to verify SENASA's
oversight of, and compliance with, the harvesting,
production, and packinghouse procedures that APHIS was
contemplating as part of the systems approach. Defendants
dispute the characterization of the report as critical,
stating that the purpose of the trip was to assist in the
development of the operational work plan, and disputing
Plaintiffs' contention that the 2015 site visit was
“among the primary bases for concluding that SENASA can
comply with the systems approach[.]” (ECF No. 35-1 at
15.) Defendants note that the report summarizing the later
September 2016 site visit, which was disclosed to the public
for comment, was used in assessing SENASA's oversight
capabilities and relied on by APHIS in formulating the Final
Rule. (ECF No. 39-1 at 18.)
or not the document was “critical, ” it certainly
was not unique, nor did its non-disclosure prevent meaningful
comment on SENASA's oversight capabilities. The 2016 Trip
Report addresses the same central issue addressed in the 2015
Trip Report - Argentina's progress in implementing the
systems approach. Compare AR 26207-34 with
AR25905-24. Plaintiff argues that disclosure of the 2016 Trip
Report was not sufficient, because the 2016 trip took place
after the harvest season, and therefore the delegation was
not able to observe Argentine growers' compliance with,
and SENASA's oversight of, harvesting and packinghouse
procedures. However, this subject was addressed in several
documents available for public comment, including the Risk
Management Document, the Proposed Rule itself, and the 2016
Trip Report. AR25905-24; AR156-59; AR168-70. Indeed, the 2016
Trip Report discusses pesticides used by Argentine growers
(including dosages), the fruit fly trapping requirement,
harvest and packing requirements, the number of SENASA
inspectors, and more. See AR25907-13. The
information contained in the 2015 Trip Report was duplicative
of other information contained in the September 2016 Trip
Report, and identified elsewhere throughout the Proposed
Rule. However, the September 2016 trip came later in the
process, therefore was arguably more central and relevant to
APHIS's determination of whether SENASA could reach
compliance than the 2015 trip. Therefore, the failure to
disclose this report was not material and does not require
the reopening of the public comment period. See Aina Nui
Corp. v. Jewell, 52 F.Supp.3d 1110, 1122-23 (D. Haw.
2014) (site visit report did not contain new critical
information where the information contained therein was
largely already contained in the proposed rule and in other
documents in the record).
also draws a distinction between the 2015 Trip Report and the
types of “scientific studies” and “complex
factual surveys” that courts concluded should have been
disclosed in other cases. (ECF No. 42 at 5.); See also,
e.g., Idaho Farm Bureau, 58 F.3d 1392, 1403
(9th Cir. 1995); Ober v. EPA, 84 F.3d 304, 314 (9th
Cir. 1996) (reopening public comment). As the Ninth Circuit
noted in Kern County Farm Bureau, agencies are
compelled to disclose documents setting out the
“technical basis” for a proposed rule. 450 F.3d
at 1076. As Defendants point out, without access to those
types of documents, the public is unable to point out errors
in methodology, data selection, and sampling. By contrast,
the 2015 Trip Report merely provides a summary of the 2015
site visit. Plaintiffs are not disputing the factual accuracy
of the report - there is no methodology or data selection to
critique - but rather arguing that the agency should have
used the report to reach a different conclusion about whether
it could rely on SENASA to execute its obligations under the
Final Rule. Bear Valley Mut. Water Co. v. Jewell,
790 F.3d 977, 993 (9th Cir. 2015) (agency's failure to
disclose studies was not prejudicial where public was on
notice of the issues raised in the additional studies and
plaintiffs did not challenge undisclosed studies'
reliability or conclusions).
do not identify any entirely unique and material argument or
comment that it would have made had the report been disclosed
before the conclusion of the notice and comment period.
Plaintiffs argue that the report evinces SENASA's
continued failure to implement procedures in line with
APHIS's requirement - an argument that could equally be
based on the disclosed 2016 Trip Report or any number of
other documents. In other words, Plaintiffs are not arguing
that their comments would have made any substantively unique
comments if they had an opportunity to comment on the 2015
Trip Report. Rather, Plaintiff objects that the agency should
have considered the information in the report to come to a
different conclusion. That argument will be addressed with
Plaintiffs' other substantive arguments and APHIS's
conclusion will be subject to review to determine whether it
was arbitrary, capricious, or an abuse of discretion.
Bear Valley Mut. Water Co., 790 F.3d at 993
(rejecting plaintiffs' procedural challenge, noting that
plaintiffs “do not challenge the reliability of the
studies, but disagree with the [agency]'s interpretation
and use of the studies”). Based on the Court's
review of that document, the information contained within it
was largely duplicated in the disclosed 2016 Trip Report, the
Proposed Rule, and other documents in the record.
a number of interested parties, including Plaintiffs,
did address SENASA's oversight capabilities in
response to the Proposed Rule. See, e.g. AR25656
(identifying potential issues with SENASA oversight under the
heading “Questions on SENASA Inspectors”). The
robust comments from the public on the issues related to
SENASA's oversight and the site visits leading up to the
implementation demonstrates that there was no prejudice in
the non-disclosure. Kern Cty. Farm Bureau, 450 F.3d
at 1076 (agency need not provide opportunity to comment on
documents that “expands on and confirms information
contained in the proposed rulemaking . . . so long as no
prejudice is shown.”).
also notes that the 2015 Trip Report was disclosed primarily
in response to comments questioning the nature of the visit.
Courts have consistently concluded that an agency may add
supporting documentation to the record in response to a
comment without having to offer an additional opportunity for
public comment, so long as the additional information is not
both critical and unique. See Rybachek v. EPA, 904
F.2d 1276, 1286 (9th Cir. 1990) (“Nothing prohibits the
Agency from adding supporting documentation for a final rule
in response to public comments”); Alaska v.
Lubchenco, 825 F.Supp.2d 209, 223-24 (D.D.C. 2011)
(“Were it otherwise, an agency could find itself stuck
in an infinite feedback loop of public comments on responses
to public comments”).