Case 1:15-cv NJV Document 1 Filed 12/04/15 Page 1 of 18
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1 Case :-cv-0-njv Document Filed /0/ Page of EDWARD C. DUCKERS (SB #) Three Embarcadero Center, Suite San Francisco, CA Telephone: () -00 Facsimile: () -0 Attorneys for Plaintiffs Sea Princess, LLC; Pacific Choice Seafood Company; Pacific Fishing, LLC 0 UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA EUREKA DIVISION PACIFIC CHOICE SEAFOOD COMPANY; SEA PRINCESS, LLC; PACIFIC FISHING, LLC, v. Plaintiffs, PENNY PRITZKER, U.S. SECRETARY OF COMMERCE; NATIONAL MARINE FISHERIES SERVICE, Defendants. Case No. COMPLAINT ( U.S.C. 0 0; U.S.C. 0 d; U.S.C. 0h) Administrative Procedure Act Case I. INTRODUCTION. In this action, Pacific Choice Seafood Company ( Pacific Choice ), Sea Princess, LLC ( Sea Princess ), and Pacific Fishing, LLC ( Pacific Fishing ) (collectively, Plaintiffs ) challenge an unlawful federal fisheries management program that threatens the ongoing viability of important West Coast fisheries that support jobs, facilities, fishermen, and businesses in California, Oregon, and Washington.. The negative effects of Defendants unlawful actions have been and will continue to be felt along the entire West Coast. As one specific example, the Northern California commercial groundfish fishing industry faces possible extinction if Defendants unlawful actions are allowed to continue. Eureka, California was once the epicenter of a thriving commercial COMPLAINT
2 Case :-cv-0-njv Document Filed /0/ Page of 0 groundfish fishery, with a multitude of fishing vessels delivering locally caught groundfish to several shoreside processors. This led to development of bustling harbors, job growth in fishing and processing, and growth in related industries such as ship repair, navigation, maintenance, fueling, and transportation.. Today, as a result of various historical economic and management factors, there is only one shoreside processing facility in Eureka owned by Pacific Choice that processes groundfish year-round. More than half of the groundfish delivered to Pacific Choice come from only four fishing vessels, all of which are owned by Pacific Fishing. Without the Eureka facility and these four vessels, groundfish processing opportunities in Eureka would be severely diminished.. The unlawful actions challenged in this Complaint have substantial negative impacts on Plaintiffs and seriously threaten the ongoing viability of the shoreside groundfish fishery all along the West Coast. As set forth below, Defendants actions violate federal law and should be vacated by this Court. II. SUMMARY OF ACTION. Plaintiffs challenge decisions of the National Marine Fisheries Service ( NMFS ) that establish and implement an individual transferable quota program for the Pacific Coast groundfish limited-entry trawl fishery ( IFQ Program ). Specifically, Plaintiffs challenge: a. NMFS s approval of Amendments and to the Pacific Coast Groundfish Fishery Management Plan ( FMP ); b. NMFS s final rule, 0 Fed. Reg., (Nov., ), and associated regulations ( November Rule ); c. NMFS s final rule, Fed. Reg., (Dec., 0), and associated regulations ( December 0 Rule ); and d. NMFS s final rule, Fed. Reg. 0, (Oct., 0), and associated regulations ( October 0 Rule ). The November Rule, the December 0 Rule, and the October 0 Rule are collectively referred to in this Complaint as the Regulations. The Regulations are promulgated COMPLAINT
3 Case :-cv-0-njv Document Filed /0/ Page of. Among other things, the IFQ Program establishes a system of allocating, limiting, and providing for transfers of quota shares ( QS ) in the West Coast non-whiting, shorebased groundfish trawl fishery (the Fishery ). As relevant to this action, the IFQ Program establishes 0 an aggregate limit on the amount of total QS, across all applicable species fished in the Fishery, that a person may own and control.. Control is expansively defined in the Regulations and includes the ability through any means whatsoever to control or have a controlling influence over [an] entity to which QS... is registered. Under the Regulations, control and ownership of QS are also implied by the ownership of an economic or financial interest in a separate entity that owns or controls QS. The specific regulations governing ownership and control, for purposes of administering the IFQ Program, are set forth at 0 C.F.R. 0.0(d)() and are referred to in this Complaint collectively as the Control Rule.. A fundamental problem with the Control Rule is that it imputes to shareholders, and others deemed to have control (no matter how remote), the ownership and control of assets (i.e., QS) that are separately owned by corporations or other entities, in a manner that is incompatible with well-established principles of corporate and agency law.. The IFQ Program establishes the aggregate control limit to be.% of all QS held by all permit holders in the Fishery (the Aggregate Limit ). See 0 C.F.R. 0.0(d)()(i)(C). Any person (as defined in the Regulations) whose ownership or control (also as defined in the Regulations) of QS exceeds the Aggregate Limit must divest itself of QS so as not to exceed the limit by no later than November 0,. Any QS not divested is revoked by NMFS. 0. The IFQ Program has not performed as NMFS intended. Since the IFQ Program was initiated, utilization rates in the Fishery have not improved, costs to harvesters have at 0 C.F.R. part 0 and implement the IFQ Program, which is specifically promulgated at 0 C.F.R The Fishery, as referenced in this Complaint, does not include halibut or Pacific whiting. COMPLAINT
4 Case :-cv-0-njv Document Filed /0/ Page of dramatically increased, and gross proceeds have remained stagnant, and in some cases, decreased. As a result of the IFQ Program, a significant amount of fishing effort has transferred out of California, further threatening the viability of the Northern California groundfish fishery. Indeed, NMFS itself recently published a report finding that the efficient and effective operation of the Fishery is unduly burdened by elements of the IFQ Program, such as the Aggregate Limit. Full 0 divestiture, effective as of November 0,, will exacerbate these problems on a large scale. In short, as has now been acknowledged by some of its strongest original proponents, the IFQ Program is an economic failure. The IFQ Program seriously threatens the viability of the Fishery.. As set forth in more detail in this Complaint, the Regulations, and Amendments and, violate the Administrative Procedure Act ( APA ) ( U.S.C. 0-0) and the Magnuson-Stevens Fishery Conservation and Management Act ( Magnuson Act ) ( U.S.C. 0-d) because (a) the Control Rule unlawfully supplants well-established common and statutory law without statutory authority to do so and is, therefore, ultra vires; (b) the Aggregate Limit is not supported by a rational explanation based on sufficient record evidence, and is arbitrary and capricious; (c) NMFS s decision to force divestiture of QS without giving credit to those who were allocated QS based on catch landing history before the IFQ Program was implemented (i.e., grandfathering ), and without adequate notice, is arbitrary and capricious; (d) the Regulations do not comply with the Magnuson Act s National Standards and provisions governing limited access privilege programs ( LAPPs ); and (e) the November Rule is arbitrary and capricious for the additional reason that NMFS unlawfully refused to postpone the divestiture period until after the reallocation for widow rockfish.. The Regulations, and Amendments and, also violate the National Environmental Policy Act ( NEPA ) ( U.S.C. -0h) because NMFS (a) did not give the effects of the action, including socio-economic effects, the required hard look analysis and (b) did not evaluate a reasonable range of alternatives. See Holland, D.S., and K. Norman.. The Anatomy of a Multispecies Individual Fishing Quota (IFQ) Market in Development. U.S. Dept. of Commerce, NOAA. NOAA Technical Memorandum NMFS-F/SPO-, p. 0. COMPLAINT
5 Case :-cv-0-njv Document Filed /0/ Page of 0. Plaintiffs respectfully request that the Court declare the Regulations, and Amendments and, unlawful, and vacate and remand the Regulations, and Amendments and, to NMFS for further consideration in compliance with all applicable law. III. PARTIES. Pacific Choice is an Oregon corporation with its principal place of business in Eureka, California. Pacific Choice operates the only remaining seafood processing facility in Eureka that processes groundfish year-round. Pacific Choice s Eureka facility has been in operation since the 0s. Pacific Choice maintains a vested interest in the sound management of the Fishery, and is regulated under, and adversely affected by, the IFQ Program. The ongoing viability of its Eureka facility is seriously threatened by the IFQ Program.. Sea Princess is an Oregon limited liability company ( LLC ) that owns a fishing vessel that participates in the Fishery. Sea Princess maintains a vested interest in the sound management of the Fishery, and is regulated under, and adversely affected by, the IFQ Program. As a result of the IFQ Program, Sea Princess was forced to divest a significant amount of QS before November 0,.. Pacific Fishing is an Oregon LLC that owns, among other things, six separate LLCs, including Sea Princess, each of which owns a vessel that participates in the Fishery. These vessels fish in Washington, Oregon, and California, and deliver to processing plants in Northern California and Oregon. Pacific Fishing maintains a vested interest in the sound management of the Fishery, and is regulated under, and adversely affected by, the IFQ Program. Under the Regulations, Pacific Fishing is deemed to own and control the QS owned by Sea Princess and the other separate LLCs owned by Pacific Fishing, as well as by other entities. Pacific Fishing has been forced to make business decisions that are contrary to its interests as a result of the substantial amount of QS that is imputed to Pacific Fishing under the Regulations. The LLCs owned by Pacific Fishing are also regulated under, and adversely affected by, the IFQ Program, and they have been forced to divest QS as a result of the IFQ Program.. On or about June,, Defendant Penny Pritzker was sworn in as the current Secretary of the United States Department of Commerce. Penny Pritzker, in her official capacity COMPLAINT
6 Case :-cv-0-njv Document Filed /0/ Page of 0 as Secretary of Commerce, directs all business of the Department of Commerce, including NMFS. In her official capacity as Secretary of Commerce, Penny Pritzker is responsible for NMFS s approval of Amendments and and promulgation of the Regulations, and for the associated statutory violations alleged in this Complaint.. NMFS is an agency of the National Oceanic and Atmospheric Administration of the United States Department of Commerce. NMFS has been delegated the responsibility for administering the provisions of the Magnuson Act, including the implementation of LAPPs, such as the IFQ Program. The authority delegated to NMFS to administer and to implement the Magnuson Act is subject to, and must be compliant with, the APA, NEPA, and all other applicable law. IV. JURISDICTION AND VENUE. This Court has jurisdiction over this action pursuant to U.S.C. 0-0 (APA), U.S.C. (f) (Magnuson Act), U.S.C. (federal question), U.S.C. (declaratory judgments), and U.S.C. (injunctive relief).. Venue lies properly in this judicial district under U.S.C. (e) because NMFS maintains an office in this district and because Pacific Choice resides in and has its principle place of business in this district. V. INTRADISTRICT ASSIGNMENT. Assignment to the Eureka Division of the Northern District of California is proper because Pacific Choice resides in and has its principle place of business in Eureka, California. VI. STATUTORY FRAMEWORK. The APA provides for judicial review of final agency action. U.S.C. 0. The APA requires courts reviewing agency action to hold unlawful and set aside [final] agency action, findings, and conclusions that, among other things, are arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law ; in excess of statutory jurisdiction, authority, or limitations, or short of statutory right ; or without observance of procedure required by law. U.S.C. 0()(A), (C), (D). Actions taken by NMFS under the Magnuson Act are subject to judicial review under the APA. See U.S.C. (f). COMPLAINT
7 Case :-cv-0-njv Document Filed /0/ Page of 0. The Magnuson Act creates a legal framework for conserv[ing] and manag[ing] the fishery resources found off the coasts of the United States by providing for the preparation and implementation... of [FMPs]. U.S.C. 0(a)(), (b)(), -. To develop and implement FMPs, the Magnuson Act created eight Regional Fishery Management Councils, each having fishery management responsibilities over an assigned geographic area. See id. (a), (h). Each Council proposes FMPs, FMP amendments, and implementing regulations to govern fishing activities within its region. See id. (a), (c).. Before FMPs, FMP amendments, and implementing regulations become effective, NMFS must review and approve them. Id. (a)-(b). NMFS is only authorized to approve FMPs, FMP amendments, and implementing regulations if they are consistent with applicable law. See id. (a)(), (b)()(b). Additionally, all implementing regulations must be consistent with the FMP and FMP amendments. Id. (b)()(b).. All Magnuson Act actions must be consistent with the National Standards. Id. (a)()(c). These standards require, among other things, that Council and NMFS actions under the Magnuson Act achiev[e], on a continuing basis, the optimum yield from each fishery and be based on the best scientific information available, while minimiz[ing] bycatch. Id. (a)()-(), (). Additionally, such actions must take into account the importance of fishery resources to fishing communities by utilizing [the best available] economic and social data... to provide for the sustained participation of such communities, and... minimize adverse economic impacts on such communities. Id. (a)(). When implementing LAPPs, such as the IFQ Program, NMFS must also ensure that allocations and assignments of fishing privileges are (A) fair and equitable to all... fishermen; (B) reasonably calculated to promote conservation; and (C) carried out in such manner that no particular individual, corporation, or other entity acquires an excessive share of such privileges. Id. (a)().. LAPPs are required to promote fishery conservation and management and social and economic benefits as well as specify the goals of the program. Id. a(c)()(c)(ii)-(iii), (F). LAPPs also must establish fair and equitable initial allocations that include consideration of, among other things, current and historical harvests, employment in COMPLAINT
8 Case :-cv-0-njv Document Filed /0/ Page of 0 the harvesting and processing sectors, investments in, and dependence upon, the fishery, and the current and historical participation of fishing communities. Id. a(c)()(a). At the same time, LAPPs must ensure that no privilege holder acquires an excessive share of the total privileges. Id. a(c)()(d).. NEPA requires federal agencies to carefully analyze the potential impacts of, and alternatives to, all proposed major federal actions that significantly impact the environment in an environmental impact statement ( EIS ). See U.S.C. (C). This requires an agency to, among other things, consider the direct, indirect, and cumulative impacts of its proposed action, and [r]igorously explore and objectively evaluate all reasonable alternatives, and... briefly discuss the reasons for eliminating other alternatives. See 0 C.F.R. 0., 0.(c), 0.. VII. STATEMENT OF FACTS. On or about May, 0, the Pacific Fishery Management Council ( Council ) presented FMP Amendments and to NMFS for approval.. The primary stated goals of Amendment are to: Create and implement a capacity rationalization plan that increases net economic benefits, creates individual economic stability, provides for full utilization of the trawl sector allocation, considers environmental impacts, and achieves individual accountability of catch and bycatch. Additional stated objectives of Amendment include: () to [p]rovide for a viable, profitable, and efficient groundfish fishery ; () to [m]inimize adverse effects... on fishing communities ; and () to [p]romote measurable economic and employment benefits through the seafood catching, processing, distribution elements, and support sectors of the industry. 0. To accomplish these goals and objectives, Amendment, among other things, instituted a LAPP, pursuant to U.S.C. a, for the shorebased trawl fleet, applicable to the whiting and non-whiting sectors. This action concerns only the portions of the LAPP applicable to the non-whiting sector of the shorebased trawl fleet (i.e., the IFQ Program). COMPLAINT
9 Case :-cv-0-njv Document Filed /0/ Page of 0. Amendment generally supplements Amendment and establishes inter-sector and intra-sector total allowable catch allocations among various fishery sectors.. In 0, NMFS partially approved Amendments and and published proposed rules to implement Amendments and by regulation. Fed. Reg., (June 0, 0); Fed. Reg.,0 (Aug., 0). NMFS subsequently finalized those proposed rules and issued the October 0 Rule and the December 0 Rule to implement Amendments and. On or about June 0, NMFS issued the final EIS for Amendment and the final EIS for Amendment, both addressing the IFQ Program (collectively, the FEIS ).. On September,, NMFS published another proposed rule to further implement the IFQ Program by setting specific divestiture-related deadlines, establishing a process for revocation of QS, adding an option for the abandonment of QS, reaffirming that excess QS would be proportionally revoked across fish species and permits, and reaffirming that revoked QS would be proportionally distributed among the participants in the Fishery. 0 Fed. Reg.,0 (Sept., ). This proposed rule was finalized with the issuance of the November Rule. The November Rule is an action, as that term is used in U.S.C. (f), that implements the October 0 Rule and the December 0 Rule.. Under the IFQ Program, QS permit owners are annually assigned a specific amount of quota pounds ( QP ) for each fish species included in the Fishery. The amount of annual QP assigned to a QS permit holder is based upon the QS percentages held by the QS permit holder and the annual catch allocations made for each species covered by the IFQ Program. QS may be bought and sold among QS permit holders. QP may also be bought and sold, as well as leased, among QS permit holders. All transfers of QS and QP must be approved by NMFS.. The IFQ Program sets individual QS control limits for each of the fish species included in the Fishery. The IFQ Program also sets an aggregate QS control limit for the Fishery (the Aggregate Limit), with which each participant in the IFQ Program must comply. This action addresses the Aggregate Limit. COMPLAINT
10 Case :-cv-0-njv Document Filed /0/ Page 0 of 0. The Aggregate Limit requires that any person (as defined in the Regulations) may not own or control more than.% of the total QS assigned, for all species combined, in the Fishery.. Under the IFQ Program, and specifically the Control Rule, control is expansively defined and includes the ability through any means whatsoever to control or have a controlling influence over [an] entity to which QS... is registered. See 0 C.F.R. 0.0(d)()(iii). In addition to this catchall definition for control, the Control Rule lists a number of situations that establish control for purposes of the IFQ Program. Id. Control and ownership of QS, for purposes of the Control Rule, is also implied by the ownership of an economic or financial interest in a separate entity that owns or controls QS. Id. 0.0(d)()(ii).. In 0, initial allocations of QS were made to participants in the Fishery based upon the catch landing history associated with limited-entry permits. Under the IFQ Program, any participant whose ownership and control of QS exceeds the Aggregate Limit must divest itself of the excess QS by no later than November 0,. Excess QS that is not divested by this deadline is revoked by NMFS.. In a Federal Register notice dated January, 0, NMFS purported to give notice that NMFS was planning to institute a LAPP for the Fishery. See Fed. Reg. (Jan., 0). This notice did not state that catch landing history associated with limited-entry permits before the LAPP was established would not be grandfathered, or otherwise credited, after the LAPP was established. As the Council and NMFS have recognized, this notice did not sufficiently apprise participants in the Fishery that the IFQ Program would negatively affect a participant s interest in the Fishery before the IFQ Program was established. 0. NMFS s failure to provide sufficient notice of the potential negative effects of the IFQ Program was exacerbated by NMFS s formal encouragement of consolidation in the Fishery through the establishment of a fishing capacity reduction program for the Fishery (the Buy-Back Program ). See Fed. Reg., (July, 0). Under the Buy-Back Program, certain Fishery participants were paid to surrender their limited-entry permits and restrict their vessels. A COMPLAINT
11 Case :-cv-0-njv Document Filed /0/ Page of 0 loan, which was to be repaid by participants remaining in the Fishery (and is still being repaid), financed the majority of the cost of the Buy-Back Program. The Buy-Back Program caused further consolidation of the Fishery, which effectively resulted in larger proportionate interests in the Fishery for the participants that remained in the Fishery.. As a result of the actions described above and below, Plaintiffs have suffered legal wrongs and have been adversely affected and aggrieved within the meaning of U.S.C. 0. Among other things, application of the Regulations, including the Aggregate Limit and the Control Rule, has unlawfully required Plaintiffs to divest themselves of QS that they have been deemed to own or control, and to otherwise act in a manner that is contrary to their rights and interests. Continued application of the IFQ Program may also cause the partial or entire closure of one or more groundfish processing operations, such as Pacific Choice s Eureka facility. VIII. FIRST CLAIM FOR RELIEF. Plaintiffs incorporate by reference all preceding paragraphs of this Complaint.. Under the APA, U.S.C. 0()(C), a reviewing court shall hold unlawful and set aside agency action found to be in excess of the agency s statutory authority or jurisdiction.. The Magnuson Act requires all FMP amendments and implementing regulations to be consistent with applicable law. U.S.C. (a)(), (b)()(b). Common law and state statutory law are applicable law as that term is used in the Magnuson Act.. Federal statutes are interpreted with the presumption that Congress intended to retain the substance of the common law and to not preempt other state or federal laws. To abrogate common law principles, a federal statute must speak directly to, and expressly supplant, the common law principles that Congress intends to address.. Whether a person or entity owns or controls an asset (such as QS), whether an entity owns another entity, and whether a person or entity controls another person or entity are issues that are determined by long-established common law and statutory principles, such as common law and statutes addressing corporations and agency.. By implementing Amendments and through the Regulations, and by specifically promulgating the Control Rule, Defendants purport to regulate the control of assets, COMPLAINT
12 Case :-cv-0-njv Document Filed /0/ Page of 0 persons, and entities in a manner that is contradictory to and incompatible with long-established common law principles addressing, among other subjects, ownership of corporate assets, disregard of the corporate form, and agency, and with statutory corporate and agency principles such as those set forth in California Corporations Code -, California Civil Code Title (Agency), Oregon Revised Statutes Title (ORS ), and Revised Code of Washington -.. The Magnuson Act does not speak directly to, and does not expressly supplant, any common law principles, including those referenced in paragraph. The Magnuson Act also does not preempt state statutes addressing corporate and agency principles, including those referenced in paragraph.. By implementing Amendments and through the Regulations, and by specifically promulgating the Control Rule, Defendants unlawfully abrogated and supplanted Corporate and Agency Law without the statutory authority to do so. 0. Accordingly, Amendments and, and the Regulations, violate the APA because Defendants have acted in excess of their statutory authority and jurisdiction, and the Magnuson Act because Amendments and, and the Regulations, conflict with and are incompatible with applicable law. IX. SECOND CLAIM FOR RELIEF. Plaintiffs incorporate by reference all preceding paragraphs of this Complaint.. NMFS purported to establish the Aggregate Limit to prevent an inequitable concentration of limited access privileges and to prevent the acquisition of an excessive share in the Fishery. See U.S.C. a(c)(). However, in establishing the Aggregate Limit, NMFS relied on a study, Lian et al. (0) (the Study ), that bore no rational relationship to these statutory provisions.. The Study was considered in a report (the GMT Report ) that did not explain the basis for the Study and expressly recognized that the Study s framework arose from a fuzzy The common law and statutory principles referred to in this paragraph are collectively referred to in this Complaint as Corporate and Agency Law. COMPLAINT
13 Case :-cv-0-njv Document Filed /0/ Page of 0 baseline. As a result, the GMT Report tentatively provided NMFS with observations, not recommendations.. In establishing the Aggregate Limit, NMFS did not account for, or explain the deficiencies of, the Study or the GMT Report. NMFS did not sufficiently vet or consistently apply the Study or the GMT Report. As expressly noted in the GMT Report, the Study s model was not used to assess results for other alternatives being considered.. NMFS did not explain its disparate treatment of the offshore and shorebased sectors of the West Coast groundfish fishery, especially as related to NMFS s setting of control limits significantly higher for the offshore sector than for the shorebased sector.. NMFS did not articulate a rational connection between either the Study or the GMT Report and NMFS s decision to set the Aggregate Limit at.%. NMFS did not otherwise rationally explain, or support with sufficient record evidence, its decision to set the Aggregate Limit at.%.. Accordingly, NMFS s decision to set the Aggregate Limit at.% was arbitrary, capricious, an abuse of discretion, and contrary to applicable law, in violation of the APA and the Magnuson Act. X. THIRD CLAIM FOR RELIEF. Plaintiffs incorporate by reference all preceding paragraphs of this Complaint.. NMFS failed to sufficiently explain whether and how Amendments and, and the Regulations, including the Control Rule and NMFS s decision to establish the Aggregate Limit at.%, would achieve optimum yield, minimize bycatch, impact fishing communities (compared to the other alternatives being considered), efficiently utilize fishery resources, minimize costs and avoid unnecessary duplication, be reasonably calculated to promote conservation, be fair and equitable, prevent excessive shares, or be consistent with any other National Standards. NMFS generally failed to sufficiently explain whether and how Amendments and, and the Regulations, are consistent with each of the Magnuson Act s National Standards, U.S.C. (a), or with the goals and objectives of Amendment. COMPLAINT
14 Case :-cv-0-njv Document Filed /0/ Page of 0 0. NMFS did not sufficiently explain whether and how QS allocations made under the IFQ Program were fair and equitable, why aggregate QS above.% is excessive, and how and why the Control Rule prevents excessive shares, and provides for fair and equitable distribution of privileges, in a manner that is consistent with all applicable laws.. In approving Amendments and, and in promulgating the Regulations, particularly the Control Rule and the Aggregate Limit, NMFS failed to comply with the Magnuson Act s LAPP requirements, U.S.C. a(c). Amendment and, and the Regulations, are not consistent with the National Standards or with the goals and objectives of Amendment.. Accordingly, Amendments and, and the Regulations, including the Aggregate Limit and Control Rule, violate the Magnuson Act, and are arbitrary and capricious and not in accordance with law in violation of the APA. XI. FOURTH CLAIM FOR RELIEF. Plaintiffs incorporate by reference all preceding paragraphs of this Complaint.. As described above, NMFS failed to give sufficient notice that the IFQ Program would adversely affect the acquisition of permits or other interests in the Fishery before the IFQ Program became effective. Additionally, in establishing the Buy-Back Program in 0, NMFS intentionally encouraged Fishery participants to take actions that would result in increased consolidation of interests in the Fishery.. The IFQ Program was intentionally designed by NMFS to decrease consolidation of interests in the Fishery.. NMFS s encouragement of actions to consolidate interests in the Fishery, its failure to provide sufficient notice that acquisition of interests in the Fishery would be adversely affected by the IFQ Program, and its failure to sufficiently consider the LAPP requirements stated in U.S.C. a(c)()(a) renders its approval of Amendments and and its issuance of the Regulations, without including a grandfather clause or another mechanism to preserve interests in the Fishery acquired prior to implementation of the IFQ Program, arbitrary and capricious and not in accordance with law in violation of the APA and the Magnuson Act. COMPLAINT
15 Case :-cv-0-njv Document Filed /0/ Page of 0 XII. FIFTH CLAIM FOR RELIEF. Plaintiffs incorporate by reference all preceding paragraphs of this Complaint.. The FEIS did not evaluate alternatives in which the Aggregate Limit would be set at greater than % of the total Fishery QS.. The FEIS also did not sufficiently consider the direct, indirect, and cumulative effects of selecting.% as the Aggregate Limit, including effects on existing retailer and consumer markets, delivery patterns pre- and post-processing, cost structures, socio-economic effects generally, and the groundfish market overall. 0. Although the FEIS identified multiple factors as relevant to the assessment of the impacts of Amendments and, and the Regulations, it did not consistently address all of the factors for each alternative considered. These factors include conservation, net benefits, disruption, excessive shares, fairness and equity, harvest and processor health, labor, communities, small entities and new entrants, general public, and program performance.. The FEIS fails to consider and analyze all reasonable alternatives, and specifically fails to consider and analyze reasonable alternatives that include setting the Aggregate Limit at percentages greater than %.. The FEIS fails to provide a hard look analysis of the effects of Amendments and, and of the Regulations, as required by NEPA.. Accordingly, NMFS violated NEPA when it approved Amendments and, and when it issued the Regulations. NMFS therefore violated the APA by taking action that is arbitrary and capricious and not in accordance with the law. XIII. SIXTH CLAIM FOR RELIEF. Plaintiffs incorporate by reference all preceding paragraphs of this Complaint.. The November Rule is an action under the Magnuson Act that implements the October 0 Rule and the December 0 Rule. The November Rule requires that any revocation of QS exceeding individual species control limits or the Aggregate Limit is to be accomplished proportionally across individual fish species. COMPLAINT
16 Case :-cv-0-njv Document Filed /0/ Page of 0. NMFS did not consider whether proportional revocation and other aspects of the November Rule were consistent with the FMP s mandates, including to (a) accommodate existing fisheries sectors, (b) minimize bycatch and impact to habitat, (c) maintain stability in landings, (d) avoid overfishing, and (e) take into account historical dependence on the Fishery.. NMFS also failed to consider whether proportional revocation and all other aspects of the November Rule were consistent with the goals and objectives of Amendments and, including to (a) increase net economic benefits, (b) create individual economic stability, (c) provide for full utilization of the trawl sector allocation, (d) consider environmental impacts, (e) achieve individual accountability of catch and bycatch, and (f) take into account historical dependence on the Fishery.. In promulgating the November Rule, NMFS did not consider whether proportional revocation and all other aspects of the November Rule were consistent with each of the Magnuson Act s National Standards, U.S.C. (a).. The November Rule, including the provisions for proportional revocation, are not consistent with the Magnuson Act s National Standards, including those that require NMFS to use the best scientific information available [which includes economic and social data], achieve optimum yield, consider efficiency in the utilization of fishery resources, minimize costs, minimize adverse impacts on fishing communities, and minimize bycatch. The November Rule is also not consistent with the goals and objectives of Amendment. 0. NMFS failed to perform the review required under NEPA to evaluate the environmental impacts of the November Rule or to otherwise determine that any such impacts were not significant, in violation of NEPA.. In promulgating the November Rule, NMFS refused to delay the divestiture deadline until after the reallocation of widow rockfish, despite repeated requests that NMFS do so. The reallocation of widow rockfish will significantly affect the calculation used to determine whether a person or entity exceeds the Aggregate Limit. NMFS s refusal to postpone the divestiture deadline until after the reallocation of widow rockfish required certain participants, including Pacific Fishing and Sea Princess, to divest of QS that is imputed to them under the COMPLAINT
17 Case :-cv-0-njv Document Filed /0/ Page of 0 Regulations before November 0,, without the benefit or knowledge of how widow rockfish will be reallocated and based upon calculations that do not consider the widow rockfish reallocation. NMFS may reallocate additional species, with similar adverse results on Fishery participants who had to divest of QS before November 0,.. NMFS s refusal to postpone the divestiture deadline until after the reallocation of widow rockfish is inconsistent with the Magnuson Act s National Standards, including those requiring NMFS to minimize costs and efficiently utilize fishery resources, and therefore violates the Magnuson Act. NMFS s refusal is also arbitrary, capricious, and an abuse of discretion in violation of the APA, U.S.C. 0()(A).. In issuing the November Rule, the Council did not consider, and NMFS did not consider or acknowledge that the Council failed to consider, the implementation of an auction system in lieu of a proportional redistribution scheme, in violation of the Magnuson Act, U.S.C. a(d).. The November Rule unlawfully implements regulations (specifically, the October 0 Rule and the December 0 Rule) that, as set forth above, violate the Magnuson Act, NEPA, and the APA.. Accordingly, the November Rule is arbitrary and capricious, in excess of NMFS s statutory authority, and not in accordance with applicable law, in violation of the APA and the Magnuson Act. XIV. RELIEF REQUESTED WHEREFORE, Plaintiffs respectfully request that the Court: A. Expedite consideration of this matter in every possible way in accordance with U.S.C. (f)(); B. Declare that Defendants, in implementing the IFQ Program through the Regulations and Amendments and, violated the APA, the Magnuson Act, and NEPA; C. Vacate and remand the Regulations and Amendments and to NMFS; D. Reinstate any QS that was divested by any of the Plaintiffs; COMPLAINT
18 Case :-cv-0-njv Document Filed /0/ Page of E. Award Plaintiffs reasonable attorney fees, costs, expenses, and disbursements, including attorney fees associated with this litigation, as appropriate under applicable law; and F. Award Plaintiffs such other and further relief as this Court may deem just and equitable. 0 DATED: December,. By:/s/ Edward C. Duckers EDWARD C. DUCKERS Attorneys for Plaintiffs Sea Princess, LLC; Pacific Choice Seafood Company; Pacific Fishing, LLC COMPLAINT
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