Notice & Comment

The D. C. Circuit Review – Reviewed:  After the lull comes the storm

After taking time off for its first judicial conference since COVID and to celebrate Independence Day, the D. C. Circuit issued a flurry of opinions last Friday that are hastily summarized here.

In American Gas Public Gas Association v. Department of Energy (APGA II), No. 22-1107, the Court held for a second time that the Department of Energy (“DOE”) acted arbitrarily and capriciously in its attempt to establish more stringent energy efficiency standards for commercial packaged boilers under the Energy Policy and Conservation Act.  In an earlier opinion (APGA I), the Court had determined that the DOE had failed to provide an adequate explanation for its final rule and remanded to the agency to reevaluate the final rule within 90 days.  After the DOE published a supplement on remand, the case returned to the Court. In an opinion authored by Judge Wilkins, and joined by Judge Henderson and Senior Judge Rogers, the Court held that the DOE should have provided notice and comment prior to publishing the supplement because the DOE relied on new literature and evidence that had not been part of the final-rule record.  Under APGA I, that new evidence was critical to the validity of the supplement, so the DOE was required to provide the public an opportunity to comment on the new evidence.  Further, the tight timeline imposed by APGA I was insufficient to trigger the Administrative Procedure Act’s good-cause exception.  Beyond notice and comment, the Court also held that the DOE failed again to offer a reasoned response to a concern raised by commenters prior to the final rule and flagged by APGA I.  The Court then decided that vacatur and remand (rather than just a remand) were appropriate.

In GMS Mine Repair v. Federal Mine Safety and Health Review Commission, No. 22-1143, the Court, in an opinion written by Judge Childs and joined by Judges Henderson and Millett, applied the Supreme Court’s instructions in Kisor v. Wilkie, 139 S. Ct. 2400 (2019), and deferred to the Mine Safety and Health Administration’s reasonable interpretation of a “genuinely ambiguous regulation.” That regulation governs how to calculate penalties against mine operators that violate the Mine Safety and Health Act of 1977.  According to the MSHA, the agency may consider only those violations that have been finally adjudicated within the preceding 15 months,  30 C.F.R. § 100.3(c), even if the violation took place earlier.

In a per curiam opinion joined by Judges Henderson, Pillard, and Pan, the Court in Intellistop, Inc. v. Department of Transportation, No. 22-1260 held that the Federal Motor Carrier Safety Administration had not acted arbitrarily and capriciously in denying Intellistop’s request for an exemption from a statutory requirement that requires commercial motor vehicles to maintain steady-burning exterior lamps so that it could install pulsing lights instead. The Court held that the agency reasonably found that the studies put forth by Intellistop to support its request had several shortcomings sufficient to justify the agency’s decision.

In Hecate Energy Greene County 3 LLC v. FERC, No. 21-1192,  the Court in an opinion authored by Judge Walker and joined by Judges Millett and Childs affirmed FERC’s dismissal of the claims of a  power plant developer that the tariff imposed by the New York Independent System Operator did not provide adequate notice of how costs were to be calculated. According to the Court, the calculations were “clearly implied by the tariff’s express terms,” which was sufficient.*

*Disclaimer: Hunton Andrews Kurth represented NYISO as Intervenor before the D.C. Circuit.

In an opinion written by Judge Childs and joined by Judge Millett and Judge Pillard, in Center for Biological Diversity v. U.S. International Development Finance Corporation, No. 22-5095, the Court concluded that the International Development Finance Corporation is not subject to the Government in the Sunshine Act because a majority of its members are not appointed to their position by the President after Senate confirmation, but serve instead ex officio or by virtue of their appointment and confirmation to other positions.

In Woodhull Freedom Foundation v. United States, No. 22-5105, in an opinion written by Judge Millett and joined by Judge Walker and Senior Judge Edwards, the Court upheld the Allow States and Victims to Fight Online Sex Trafficking Act of 2017 (“FOSTA”) against void for vagueness, overbreadth, unconstitutional viewpoint discrimination, and ex post facto challenges. The plaintiffs argued that FOSTA’s provisions prohibiting supporting, promoting, or facilitating sex trafficking are overbroad and unlawful viewpoint discrimination because they could cover protected speech, such as general advocacy and providing safety and health information. The Court rejected that argument, explaining that statutory context shows that the provision prohibits only conduct that falls within the traditional bounds of aiding-and-abetting liability, which is not protected by the First Amendment. The Court also rejected a void for vagueness challenge, reasoning that the statute provides fair notice because it uses terms that are common in criminal law.

In Jones Lange LaSalle Brokerage, Inc. v. 1441 L Associates, LLC, No. 22-046, JLL represented both parties to an agreement to lease property in northwest Washington, DC. The District of Columbia’s Brokerage Act required JLL to obtain the written consent of all clients on both sides. One of JLL’s clients, 1441 L Associates, declined to pay JLL’s commission, arguing that JLL failed to adhere to the Brokerage Act’s formatting specifications. In an opinion written by Chief Judge Srinivasan and joined by Judge Millett and Senior Judge Edwards, the Court held that compliance with the formatting specifications only allows the broker to take advantage of a presumption that it secured the required written consent.

Mary Ofisi v. BNP Paribas, S.A., No. 22-7083, involved claims by survivors and family members of victims of the 1998 U.S. embassy bombings in Kenya and Tanzania against an international bank, BNP Paribas, S.A., alleging that the bank acted in support of terrorists who committed the attacks by flouting U.S. sanctions against Sudan and establishing a banking relationship with the country. In an opinion written by Senior Judge Sentelle, and joined by Judge Rao and Senior Judge Rogers, the Court affirmed the dismissal of claims for common law conspiracy, common law aiding and abetting, aiding and abetting under the Alien Tort Statute, and statutory violations under the Anti-Terrorism Act. With respect to the common law claims, the plaintiffs failed to plausibly allege that BNP and al-Qaeda shared a common scheme to perpetrate the bombings. The Court further explained that the Alien Tort Statute does not extend to foreign corporate defendants. Finally, the Court concluded the Anti-Terrorism Act claim failed because the plaintiffs did not plausibly allege that BNP knew or should have known its transactions would end up supporting al-Qaeda.

In United States v. Douglas, No. 21-3032, the Court issued a two-paragraph per curiam opinion affirming the district court’s decision that a Terry stop that led to the discovery of a loaded pistol on a felon was lawful.  The opinion noted that the Court was divided on the question but provided no further explanation.  Senior Judges Randolph and Rogers wrote separately offering different grounds to affirm. Judge Wilkins dissented. Senior Judge Randolph concluded that the police had reasonable suspicion to initiate the stop relying on the “significant fact” that the stop occurred in a location known for criminal transactions as well as the “critical” consideration of the undercover agent’s skill and experience.  Senior Judge Rogers took a narrower approach to find reasonable suspicion that supported the police action. She emphasized that the location was known for illegal drug transactions, the furtive way the men handled the bag and the money, and the agent’s training and experience.  In dissent, Judge Wilkins found this to be “a close case” but concluded that the police lacked reasonable suspicion to stop and seize the defendant.

In Devon Tinius v. Luke Choi, D.C. Metropolitan Police Officer, No. 22-7047, in an opinion written by Judge Pillard, and joined by Judge Pan and Senior Judge Edwards, the Court upheld against First Amendment challenge to D.C.’s two-night curfew order that was based on the need to protect public safety from violent rioting and prevent the spread of COVID-19. The plaintiffs claimed that their First Amendment rights had been violated when they were arrested for violating the curfew while peacefully protesting the killings of black Americans by police officers. The Court first found the curfew order was a content-neutral time, place, and manner restriction that prohibited all public activity after 7:00 pm, without regard to its expressive character. Applying intermediate scrutiny, the Court found that D.C.’s public safety and public health interests were significant interests, the temporary curfew order was “narrowly tailored” to achieve those interests, and the order allowed ample alternative channels of communication, such as protesting during the day or at night after the two-day curfew expired.

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