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INDEPENDENT GASOLINE MARKETERS COUNCIL v. DOE

April 9, 1981

INDEPENDENT GASOLINE MARKETERS COUNCIL, Plaintiff,
v.
DEPARTMENT OF ENERGY et al., Defendants



The opinion of the court was delivered by: GREEN

MEMORANDUM OPINION

This case involves the propriety of certain standby regulations promulgated by the Administrator of the Economic Regulatory Administration (ERA), an agency within the Department of Energy (DOE). Those regulations, adopted January 18, 1979, were added to the Mandatory Petroleum Allocation and Price Regulations, 10 C.F.R. Parts 210-212, and appear as 10 C.F.R. §§ 210-1, 211-1 (as amended, 45 Fed.Reg. 55378, Aug. 19, 1980), and 212-1 (hereinafter referred to as the "Special Rules"). The ERA instituted the Special Rules in standby status, meaning that although promulgated officially in final form, they are presently inactive and without force or effect.

 The regulations, which set standby price and allocation rules for petroleum, could be utilized in various scenarios, including "a significant national or regional crude oil or refined product shortage, or a widespread pattern of inequitable prices...." 44 Fed.Reg. 3928 (Jan. 18, 1979). Generally, the Special Rules give the Administrator of the ERA (the Administrator) authority to update the Mandatory Petroleum Price and Allocation Regulations to a more current basis, to alter the scheme which determines the regional allocation of petroleum, and to regulate the allocation of "kerosene-base jet fuel, middle distillates, and residual fuel oil" with respect to certain categories of purchasers. Id. at 3928-9.

 The Administrator can activate the Special Rules whenever he determines, in his discretion, that they would ease shortages of fuel regionally or nationwide, or that they would alleviate any other danger to the nation's energy usage. The rules are designed to be flexible, giving the Administrator wide latitude in the manner of implementation. The supplementary information to the rules states,

 
For instance, the Administrator might act quite differently in addressing a supply interruption of a known, limited duration (resulting, for example, from a single act of sabotage) than in addressing a situation where suppliers of a particular product, such as unleaded gasoline, become short and prices rise to inequitable levels.

 Id. at 3929. The Special Rules can also be activated automatically, unless the Secretary of Energy determines otherwise, when the crude oil allocation provisions of the International Energy Agreement take effect, giving rise to concerted action by member nations to ensure equitable petroleum allocation in the event of a major, global interruption of supply.

 The Special Rules have been implemented only once. On February 28, 1979, the Administrator ordered Special Rule 211-1 partially activated to update the "base period" that determines certain supplier-purchaser relationships pursuant to 10 C.F.R. § 211.102. The base period was changed from 1972 to 1977 to facilitate fairer distribution of petroleum products. See 44 Fed.Reg. 11202 (Feb. 28, 1979). An interim rule superseded this activation on May 1, 1979 and a final rule, amending 10 C.F.R. § 211.102, codified the updated base period on September 1, 1979. 44 Fed.Reg. 42549 (July 19, 1979). Except for that single temporary activation of Rule 211-1, the Special Rules have remained inactive.

 Plaintiff Independent Gasoline Marketers Council (IGMC) is a trade association of gasoline station operators not associated with major oil companies. On behalf of its members, IGMC has brought this suit challenging the Special Rules as unconstitutional, in that they deprive plaintiff's members of property without due process, and as illegal because of improper rulemaking procedure and because they are beyond the authority given the Department of Energy in the Emergency Petroleum Allocation Act, 15 U.S.C. § 751 et seq. Plaintiff also sought review of the Special Rules in the Court of Appeals for this Circuit, *fn1" but that action is stayed pending the outcome of the case in this Court.

 The defendants, the Department of Energy (DOE) and other officials have moved to dismiss the action, and alternatively, for summary judgment. In response to this motion for summary judgment, plaintiff avers that it has been unable to obtain discovery and therefore cannot allege the existence of material factual issues; thus, plaintiff asks the Court for an order directing the defendants to permit the plaintiff to seek discovery. After an examination of the relevant memoranda of points and authorities and the record in the case, it appears that plaintiff has not alleged such substantial constitutional violations as would warrant certification to the Temporary Emergency Court of Appeals, and that the case is not ripe for judicial review, presenting no case or controversy as to any of the challenged administrative actions. Therefore, the case will be dismissed for lack of a justiciable dispute.

 At the outset, it is necessary to determine the exact substance of the plaintiff's challenge. IGMC filed this suit on February 13, 1979, challenging the Special Rules on constitutional and statutory grounds. The rules were then inactive. On February 22, 1979, Activation Order No. 1 was issued. The essence of that Order was that the base period used to determine the allocation of gasoline for use in motor vehicles was updated from 1972 to 1977-78. Activation Order No. 1 was revoked when the Department promulgated an interim rule, pursuant to apparently appropriate procedures, that instituted the new, updated basis in formal regulatory terms, and not in terms of the standby activation order. Plaintiff amended its complaint on April 24, 1979, during the time Special Rule No. 1 was in effect. However, nowhere in the complaint did IGMC allege that it or any of its members was injured by the activation order imposed in February under the Special Rules. In fact, the activation order was not even mentioned in the amended complaint. The activation order expired by its own terms May 31, 1979.

 IGMC's challenge to Activation Order No. 1 fails on two independent grounds, because it has not complained of any injury resulting from the Activation Order and because its challenge to the Order is moot. Plaintiff's only mention of Activation Order No. 1 and the injury alleged to have resulted therefrom is in its reply to the defendants' motion for dismissal. Where the plaintiff does not allege a wrong from an administrative action, even liberal theories of pleading do not permit the Court to substitute for the plaintiff's allegations its own view of what the plaintiff should be challenging. In addition, there is a substantial question as to whether the IGMC has suffered any wrong resulting from Activation Order No. 1.

 Plaintiff's complaint concerning Activation Order No. 1 is also moot and fits no recognized exception to the mootness doctrine. The activation of Special Rule No. 1 ended May 31, 1979 and does not now affect plaintiff's legal rights or obligations in any way. Federal courts are without power to decide moot or abstract questions. Amalgamated Ass'n of R.R., etc. Employees v. Wisconsin Employment Board, 340 U.S. 416, 71 S. Ct. 373, 95 L. Ed. 389 (1951). This conclusion is not affected by the fact that this case seeks declaratory relief. Poe v. Ullman, 367 U.S. 497, 506, 81 S. Ct. 1752, 1757, 6 L. Ed. 2d 989 (1961).

 This challenge does not fall under the exception to the mootness doctrine outlined in Southern Pacific Terminal Co. v. Interstate Commerce Commission, 219 U.S. 498, 31 S. Ct. 279, 55 L. Ed. 310 (1911), which allows review of technically moot challenges when the order is "capable of repetition, yet evading review." Id. at 515, 31 S. Ct. at 283. Plaintiff has not alleged that the order embodied in Activation Order No. 1 will ever be repeated, and in fact, since that order has now been revoked in place of an administrative regulation, repetition is impossible. This is not a case like Nader v. Volpe, 154 U.S. App. D.C. 332, 475 F.2d 916 (D.C.Cir.1973), where the plaintiff challenged exemptions from automobile safety standards granted by the Secretary of Transportation under a single statutory provision. Because the exemptions were temporary and discretionary, they could be withdrawn prior to a court considering whether the defendant had authority to issue them. The Secretary also asserted his intention to issue identical orders in the future. Thus, the Court rejected the claim that the dispute was moot. In this dispute, not only will Activation Order No. 1 not be repeated, but there is no allegation that circumstances will prevent judicial review. See Weinstein v. Bradford, 423 U.S. 147, 96 S. Ct. 347, 46 L. Ed. 2d 350 (1975). "A mere speculative possibility of repetition is not sufficient." Williams v. Alioto, 549 F.2d 136, 143 (9th Cir. 1977). Thus, on either of two grounds, the failure of plaintiff to allege injury from Activation Order No. 1, or the mootness of any challenge by IGMC of that particular order, the case is properly limited to plaintiff's allegations as to the legality of the Special Rules, apart from their activation in February, 1979.

 The plaintiff has challenged the Special Rules on constitutional grounds, claiming that they work an unconstitutional deprivation of property in violation of the Fifth Amendment and that they violate due process because the Administrator can invoke the Special Rules without notice. If the Court deems these claims substantial constitutional issues, then proper jurisdiction lies in the Temporary Emergency Court of Appeals. 15 U.S.C. § 754(a)(1), incorporating § 211(c) of the Economic Stabilization Act, see 12 U.S.C. § 1904 (Note). The Temporary Emergency Court of Appeals will have jurisdiction over these claims if they are not plainly without merit or foreclosed by precedent of the Supreme Court or the Temporary ...


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