Home » Case Summaries » 2015 » Building Industry Ass’n of the Bay Area v. U.S. Department of Commerce, 792 F.3d 1027 (9th Cir. 2015)

 
 

Building Industry Ass’n of the Bay Area v. U.S. Department of Commerce, 792 F.3d 1027 (9th Cir. 2015)

 

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In this case, the Building Industry Association of the Bay Area (BIABA)[1] sued the National Marine Fisheries Service (NMFS)[2] in the United States District Court for the Northern District of California. BIABA sued NMFS under the Administrative Procedure Act (APA)[3] and the Endangered Species Act (ESA),[4] alleging a failure to follow the appropriate methodology for designating critical habitat. In addition, BIABA alleged that NMFS had violated the National Environmental Policy Act (NEPA)[5] by failing to submit an Environmental Impact Statement (EIS). The district court held that NMFS had not violated the ESA, that a decision to not exclude an area from critical habitat designation was not subject to judicial review, and that NMFS was not required to conduct a NEPA analysis when designating critical habitat. The Ninth Circuit affirmed the district court’s holdings.

This case centered on the southern distinct population segment of green sturgeon and the aftermath of NFMS’s decision to list the green sturgeon as a threatened species. Under the ESA, agencies are required to consider designating critical habitat upon listing a species as threatened or endangered.[6] As part of that consideration, the ESA requires the agency to consider, among other things, the economic impact of the designation.[7] If the benefits of excluding designation outweigh the benefits of designation, the agency may exclude an area from critical habit designation;[8] however, an agency may not exclude an area where the exclusion would result in the extinction of the species.[9]

Pursuant to the ESA, NMFS designated over 12,000 square miles of marine, estuary, and riverine habitat as a critical habitat. NMFS also excluded fourteen areas from its critical habitat designation, finding that the benefits of exclusion outweighed the benefits of designation for these areas.

BIABA sued, alleging NMFS had violated the APA and the ESA by failing to follow the specific methodology of section 4(b)(2) of the ESA and failing to comply with NEPA. The Center for Biological Diversity (CBD) intervened, and the parties cross-moved for summary judgment. The district court granted summary judgment for NMFS and CBD, holding that 1) NMFS had complied with the ESA, 2) NMFS’s decision to not exclude was not subject to judicial review, and 3) NEPA was not implicated in critical habit designation. The Ninth Circuit reviewed the district court’s grant of summary judgment de novo, and reviewed NMFS’s actions under the arbitrary and capricious standard.

The Ninth Circuit first held that NMFS had complied with section 4(b)(2) of the ESA in deciding which areas to designate as critical habitat. Section 4(b)(2) states that the agency “shall designate critical habitat . . . after taking into consideration the economic impact,” and that the agency “may exclude any area from critical habit” if the benefits of exclusion outweigh the benefits of designation and exclusion will not result in extinction of the species.[10] In rejecting BIABA’s contention that the second sentence requires a specific balancing-of-the-benefits methodology, the Ninth Circuit noted the use of the discretionary term “may.” In addition, the court pointed to an October 2008 legal opinion from the Department of the Interior that had independently concluded section 4(b)(2) did not contain a specific methodology. This legal opinion was entitled to Skidmore deference.[11] Finally, the court noted that the legislative history further reinforced this interpretation. The Ninth Circuit held that NMFS had complied with section 4(b)(2) because the record showed that NMFS considered the conservation value of each area, and that NMFS had estimated the economic impact of each area by assessing the level of economic activity and the level of protection required by existing regulations for each of these economic activities.

Second, the Ninth Circuit determined that NMFS’s decision to not exclude certain areas from critical habitat designation could not be judicially reviewed. In rejecting BIABA’s argument to the contrary, the court noted that Bear Valley Mutual Water Co. v. Jewell (Bear Valley),[12] decided earlier in the same term, held that an agency’s decision not to exclude critical habitat was unreviewable.[13] The court explained that this conclusion fit within the framework of Heckler v. Chaney,[14] where the Supreme Court held an agency decision was unreviewable where “a court would have no meaningful standard against which to judge the agency’s exercise of discretion.”[15]Because the second sentence of section 4(b)(2) was completely discretionary, the court had no standard against which to judge NMFS’s decision not to exclude areas from designation. Accordingly, the Ninth Circuit reaffirmed Bear Valley,and held that NMFS’s decision not to exclude was not subject to judicial review.

Third, the Ninth Circuit concluded that NMFS was not required to comply with NEPA in its decision to designate critical habitat. In rejecting BIABA’s argument to the contrary, the court noted that this issue had already been considered and decided. In Douglas County v. Babbitt,[16] the Ninth Circuit held that critical habit designations were not subject to NEPA for three reasons: First, the ESA displaced NEPA’s procedural requirements; second, NEPA does not apply to actions to critical habit designations because designations do not alter the physical environment; and third, critical habit designations serve the purpose of NEPA by protecting the environment from human impact.[17] The Ninth Circuit reaffirmed Douglas County and held that NFMS was not required to comply with NEPA in its decision to designate critical habitat.

In sum, the Ninth Circuit held that NFMS had complied with section 4(b)(2) of the ESA, NFMS’s decision to not exclude under the ESA was not subject to judicial review, and NEPA was not implicated in critical habitat designation. Accordingly, the Ninth Circuit affirmed the district court’s ruling.

 

 

 

Footnotes    (↵ returns to text)

  1. Bay Planning Coalition (BPC) was also a plaintiff-appellant.
  2. The United States Department of Commerce delegates its responsibility for critical habit designation to NFMS. Other defendant-appellees include the National Oceanic and Atmospheric Administration, Gary Locke (Secretary for the United States Department of Commerce), and Eric C. Schwaab (Assistant Administrator for the United States National Marine Fisheries Service).
  3. 5 U.S.C. §§ 551–559, 701–706, 1305, 1305, 3344, 4301, 5335, 5372, 7521 (2012).
  4. Endangered Species Act of 1973, 16 U.S.C. §§ 1531–1544 (2012).
  5. National Environmental Policy Act of 1969, 42 U.S.C. §§ 4321–4370h (2012).
  6. 16 U.S.C. § 1533(b)(6)(C) (2012).
  7. Id. § 1533(b)(2) (also known as section 4(b)(2)).
  8. Id.
  9. Id.
  10. Id.
  11. Skidmore v. Swift & Co., 323 U.S. 134, 140 (1944). Under Skidmore, an agency’s ruling, interpretation, or opinion is not controlling, but it may provide guidance to the court. Id. at 140.
  12. 790 F.3d 977 (9th Cir. 2015).
  13. Id. at 989.
  14. 470 U.S. 821, 830 (1985).
  15.  Id.
  16. 48 F.3d 1495 (9th Cir. 1995).
  17.  Id. at 1503, 1505–1506.
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