Chenery stands, namely, that the choice between rulemaking and adjudication should be left to agency discretion, subject to court review for abuses of discretion.
Although the court agrees with plaintiffs that the type of requirements and standards enunciated in the DCI are of the variety that might best have been promulgated after notice and comment, it is not the prerogative of either plaintiffs or the court to demand that the agency proceed in such a fashion. Since the court finds that Congress did not require EPA to proceed by rulemaking and that EPA did not abuse its discretion by choosing to proceed by way of adjudication, the court concludes that the agency was not required to comply with § 553 of the APA.
III. DCI and Due Process
Related to plaintiffs' § 553 argument is their assertion that the agency's failure to make specific findings on the economic data submitted by plaintiffs and refusal to disclose the Agency's own estimates of the cost of implementing the program announced in the DCI constitute a violation of due process. Plaintiffs assert that "to the extent EPA purported to make an individualized adjudication of each of the plaintiffs' entitlement to a [sic] economically-based waiver from the DCI, that determination was subject to the minimum due process requirements of notice and an opportunity to be heard."
In order to raise a valid due process argument, plaintiffs must demonstrate that a cognizable liberty or property interest has been subject to deprivation. In this case, the data gathering requirements specified in the DCI do not in themselves divest plaintiffs of a property interest. Although the failure to obey the DCI will impact plaintiffs' registration -- a recognized property interest
-- until such deprivation occurs, the court need not consider plaintiffs' due process argument.
Even assuming, however, that plaintiffs have been deprived of a cognizable property interest, their due process claim would still have to be rejected because plaintiffs have not demonstrated why additional procedures are justified.
In this case, plaintiffs were given notice of the issuance of the DCI
and several opportunities to raise concerns over the cost and technical requirements of the DCI. The agency considered plaintiffs' objections and in response significantly modified the DCI. Given the detailed procedural history of this case and EPA's apparent good faith throughout, it is difficult to see how requiring notice and comment at this point would shed new light on the issue or improve the quality of decisionmaking.
Since the court finds that plaintiffs have been afforded adequate procedural protections and that the imposition of formal notice and comment cannot be justified in terms of either cost or time or quality of decisionmaking, plaintiffs' due process challenge is denied.
IV. Section 706 Review of EPA's Decision to Issue and Enforce the DCI
Under the APA, court review of agency actions are governed by § 706 which states that the court shall "(2) hold unlawful and set aside agency action, findings, and conclusions found to be (A) arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law."
Under this standard of review, plaintiffs allege that the court should not enforce EPA's DCI because the agency (1) did not engage in a cost-benefit analysis as required by FIFRA before issuing the DCI and (2) enacted data gathering requirements which exceed the bounds of reasonableness without adequate justification.
A. FIFRA and Cost/Benefit Assessment Requirements
Plaintiffs posit that by refusing to consider the consequences of the DCI data gathering requirements -- namely, the likely elimination of the product from the market -- EPA failed to consider a "relevant factor"
and acted in contravention of FIFRA.
Section 7 U.S.C. § 136(bb) states that in assessing whether a product has "unreasonable adverse effects on the environment," EPA must take into account "the economic, social, and environmental costs and benefits of the use of any pesticide."
Plaintiffs argue that the cost/benefit analysis referred to in 7 U.S.C. § 136(bb) is an overarching principle of FIFRA and applies to EPA decisions pursuant to 7 U.S.C. 136a(c)(2)(B)(ii) to issue data gathering requirements so onerous that suspension or cancellation of the registration is inevitable. Under this interpretation of the statute, EPA was required to balance the need for information on the risks of the pesticide against the possibility that the product might cease to be produced if the data requirements are enforced.
If Congress had included the cost/benefit language of § 136(bb) in 7 U.S.C. 136a(c)(2)(B)(ii), the court's work would be greatly simplified. Nowhere in § 136a(c)(2)(B)(ii), however, is there a requirement of cost-justified decisionmaking. Moreover, as defendant points out, at the same time that Congress omitted the cost/benefit language from § 136a(c)(2)(B)(ii), it included the cost/benefit requirement in other sections of the statute.
Defendant maintains, additionally, that from a policy perspective, the imposition of cost/benefit analysis on DCI decisions would frustrate the agency's ability to perform the cost/benefit assessment statutorily mandated for registration, suspension, and cancellation decisions. As the defendant notes, "Under plaintiffs' reading of the statute, when a useful but extremely hazardous pesticide is produced by firms that are marginal or suffering financial losses, EPA can never learn of the hazard because the Agency would not be able to ask for data on toxicity."
The inconsistent appearance of cost/benefit language in the statute overall,
buttressed by defendant's policy and structure arguments, make EPA's reading of FIFRA's cost/benefit requirement a permissible one. Although plaintiffs' reading is also plausible, the Chevron principles discussed above forbid the court to reject a reasonable agency construction. Accordingly, the court does not find that EPA was required to do a cost-benefit analysis of the consequences of the issuance of the DCI prior to its issuance.
B. Court Review of the Substance of the DCI
Plaintiffs state in their memorandum for summary judgment that the requirements of the DCI are "unusually stringent, if not unprecedented. . . . Taken together, they comprise a monitoring program of unique duration, size, and complexity that vastly exceeds the Government's normal practice when its own funds are at stake."
Plaintiffs contend that by failing to provide explanations for why the requirements are necessary and why a less rigorous program (e.g. the alternative proposed by plaintiffs) would not suffice, EPA has acted arbitrarily and capriciously, in violation of the APA.
The requirements of the TBT monitoring program are undeniably extensive. In assessing scientific judgments by the expert agency, however, the court must "generally be at its most deferential"
and should not "second-guess the scientific judgments of the EPA."
In this case, the court has no reason to question the scientific validity of the agency's determinations. Review of the record amply demonstrates that the agency has offered clear statements of the objectives of the TBT monitoring program, J.A. 753 - 55, and provided scientific rationales for the principal technical features of the TBT monitoring program: sampling at two water depths, prohibition of sample compositing, and use of transplanted organisms. J.A. 752 - 68, 832 - 33, 838. Plaintiffs point to differences between other testing programs and the one at issue in this case,
but disparities in requirements among these testing schemes are easily explained by the differing purposes of each program.
In sum, the court sees no reason to question the scientific merit of the agency's determination of TBT testing standards. The EPA did "examine the relevant data and articulate a satisfactory explanation for its action"
and did not act arbitrarily or capriciously.
In conclusion, the court finds that EPA has the authority to issue the DCIs which place on plaintiffs the duty to perform the ten year TBT monitoring requirements required by OAPCA. The court finds that in this case, the agency acted properly and within its discretion to issue the monitoring standards by informal adjudication, rather than through rulemaking. Finally, the court finds that neither the mode of agency decisionmaking nor the substance of the DCI were arbitrary or capricious.
For the reasons set forth above, the court this date shall enter the accompanying order granting the defendant's motion for summary judgment and denying plaintiffs' motion for summary judgment.
ORDER - March 12, 1991, Filed
Upon consideration of plaintiffs' and defendant's motions for summary judgment, and for the reasons set forth in the Court's Memorandum Opinion of this date, it is hereby
ORDERED, that defendant's motion for summary judgment is granted, and it is further
ORDERED, that plaintiffs' motion for summary judgment is denied, and it is further
ORDERED, that summary judgment is entered for defendant, and this case is hereby DISMISSED WITH PREJUDICE.