Kuang et al v. United States Department of Defense et al

Filing 94

ORDER RE: DISCOVERY JOINT LETTER BRIEF re 87 Joint Discovery Letter Brief. Signed by Judge Jon S. Tigar on January 23, 2019. (wsn, COURT STAFF) (Filed on 1/23/2019)

1
2
3
4

UNITED STATES DISTRICT COURT

5

NORTHERN DISTRICT OF CALIFORNIA

6
JIAHAO KUANG, et al.,

7

Plaintiffs,

8

ORDER RE: DISCOVERY JOINT
LETTER BRIEF

v.

9
10

UNITED STATES DEPARTMENT OF
DEFENSE, et al.,

11

United States District Court
Northern District of California

Case No. 18-cv-03698-JST

Re: ECF No. 87

Defendants.

12
13

Before the Court is the parties’ discovery joint letter brief. ECF No. 87. The parties

14

presented additional argument in their joint case management statement and at a case management

15

conference on January 16, 2019. ECF Nos. 92, 93. The Court will grant Plaintiffs’ request for

16

extra-record discovery in part.

17

I.

18

BACKGROUND
This case concerns Plaintiffs’ challenge to a Department of Defense (“DoD”) policy

19

regarding the background investigation that DoD conducts for all enlisted recruits as part of their

20

entry into military service. ECF No. 68 at 5-7. In an October 13, 2017 memo (“October 13

21

Memo”), DOD announced that lawful permanent residents (“LPRs”) would be not be able to

22

access into basic training or active service until their full background investigations had been

23

completed. Id. at 8. Under the new policy, U.S. citizens – unlike LPRs – remain able to access

24

after an initial screening. Id. at 7-8.

25

On October 19, 2018, DoD produced the administrative record. ECF No. 57. On

26

November 16, 2018, the Court issued an order granting Plaintiffs’ unopposed motion for class

27

certification, denying DoD’s motion to dismiss, and granting Plaintiffs’ motion for a preliminary

28

injunction based on their 5 U.S.C. § 706(2) claim under the Administrative Procedure Act

1

(“APA”). ECF No. 68.
DoD has appealed the preliminary injunction, ECF No. 73, and filed a motion to stay the

2
3

injunction pending appeal with the Ninth Circuit, see Kuang v. DoD, No. 18-17381 (9th Cir.),

4

ECF No. 9. Pursuant to the Ninth Circuit’s order, Plaintiffs filed their opposition to the stay on

5

January 4, 2019. Id., ECF No. 12. As of the issuance of this order, the Ninth Circuit has not acted

6

on DoD’s stay request.1
While DoD seeks to stay the Court’s injunction pending appeal of that order, neither party

7

has requested to stay further proceedings in this Court during the pendency of DoD’s interlocutory

9

appeal. Moreover, the Ninth Circuit has “repeatedly admonished district courts not to delay trial

10

preparation to await an interim ruling on a preliminary injunction.” California v. Azar, 911 F.3d

11

United States District Court
Northern District of California

8

558, 583 (9th Cir. 2018). The Court therefore proceeds to resolve the parties’ discovery dispute.

12

II.

DISCUSSION

13

The parties contest whether Plaintiffs are entitled to fact discovery beyond the

14

administrative record. ECF No. 87 at 2. Plaintiffs advance two arguments in support of their

15

position. First, Plaintiffs argue that, notwithstanding the limitations on extra-record discovery that

16

apply to their APA claims, they are entitled to discovery on the merits of their constitutional

17

claims. Id. at 2-3. Second, Plaintiffs contend that they are entitled to discovery regarding the non-

18

merits (i.e., equitable) elements of a permanent injunction. Id. at 3-4.

19

A.

Constitutional Claims

20

At the outset, the Court acknowledges that, as Plaintiffs point out, “[t]he caselaw on a

21

plaintiff’s ability to supplement an administrative record to support a constitutional cause of action

22

is sparse and in some tension.” Bellion Spirits, LLC v. United States, 335 F. Supp. 3d 32, 41

23

(D.D.C. 2018). The Court therefore decides this issue only in the context of the specific

24

circumstances before it.
In this case, the Court concludes that Plaintiffs’ constitutional claims do not warrant extra-

25
26
27
28

1

DoD filed a similar stay motion with this Court, prior to seeking the same relief from the Ninth
Circuit. ECF No. 74. Rather than conduct simultaneous proceedings on the same request, the
Court held DoD’s stay motion in abeyance pending further action from the Ninth Circuit. ECF
No. 91.
2

1

record discovery. Surveying the law in this area, the Bellion Spirits court concluded that “[t]here

2

appears to be a common thread running through . . . cases [denying extra-record discovery]: when a

3

constitutional challenge to agency action requires evaluating the substance of an agency’s decision

4

made on an administrative record, that challenge must be judged on the record before the agency.”

5

335 F. Supp. 3d at 43. Some courts have reasoned that this is so as a matter of statutory

6

interpretation, because Ҥ 706 of the APA provides for judicial review of final agency action that is

7

‘contrary to constitutional right, power, privilege, or immunity.’” Chiayu Chang v. U.S.

8

Citizenship & Immigration Servs., 254 F. Supp. 3d 160, 161 (D.D.C. 2017) (quoting 5 U.S.C.

9

§ 706(2)(B)) (collecting cases). Others have reasoned that a contrary rule would “incentivize every
unsuccessful party to agency action to allege bad faith, retaliatory animus, and constitutional

11

United States District Court
Northern District of California

10

violations to trade in the APA’s restrictive procedures for the more even-handed ones of the

12

Federal Rules of Civil Procedure.” Jarita Mesa Livestock Grazing Ass’n v. U.S. Forest Serv., 58 F.

13

Supp. 3d 1191, 1238 (D.N.M. 2014). And some courts have limited their reasoning to cases

14

“where a plaintiff’s constitutional claims fundamentally overlap with their other APA claims.”

15

Chiayu Chang, 254 F. Supp. 3d at 162 (citing Alabama-Tombigbee Rivers Coal. v. Norton, No.

16

CIV.A.CV-01-S-0194-S, 2002 WL 227032, at *5 (N.D. Ala. Jan. 29, 2002)).
The Court finds the reasoning in Bellion Spirits and Chiayu Chang persuasive. As the

17
18

Court observed in its prior order, Plaintiffs’ equal protection and substantive due process claims

19

allege that DoD’s policy lacks a rational basis, requiring a “fundamentally similar” analysis as the

20

question whether it was arbitrary and capricious in violation of § 706(2). Id.; see also ECF No. 68

21

at 25-26; 29-30. Importantly, as in Chiayu Chang, “[n]o suspect class is alleged regarding the

22

equal protection claim, meaning that the government need only present a rational basis for its

23

actions.” 254 F. Supp. 3d at 162; see also ECF No. 68 at 23-24. Under those circumstances, the

24

Ninth Circuit and other courts have held that “the equal protection argument can be folded into the

25

APA argument” and considered on the administrative record. Ursack Inc. v. Sierra Interagency

26

Black Bear Grp., 639 F.3d 949, 955 (9th Cir. 2011); see also ECF No. 68 at 25-26 (collecting

27

cases).

28

Plaintiffs’ cases do not compel a contrary result here. In Grill v. Quinn, the pro se
3

plaintiff’s constitutional claim challenged the agency’s procedures, while the APA claim attacked

2

the substance of the decision. No. CIV S-10-0757 GEB, 2012 WL 174873, at *1-2 (E.D. Cal. Jan.

3

20, 2012); cf. Bellion Spirits, 335 F. Supp. 3d at 43 (distinguishing Rydeen v. Quigg, 748 F. Supp.

4

900, 906 (D.D.C. 1990), on the same basis). Further, while the Supreme Court in Webster v. Doe

5

contemplated discovery associated with constitutional claims challenging an employee’s discharge

6

from the Central Intelligence Agency, it also held that APA review was unavailable for those

7

claims. 486 U.S. 592, 601, 603 (1988). Webster therefore does not address the question whether

8

discovery is necessary when the agency produces an administrative record documenting the basis

9

for its decision, let alone the circumstances that would justify such discovery. To the extent that

10

Plaintiffs contend that the administrative record in this particular case is inadequate, ECF No. 87

11

United States District Court
Northern District of California

1

at 3, they have not shown that the proper remedy is unconstrained discovery into the merits of

12

their constitutional claims, rather than litigating this issue through the normal exceptions

13

concerning extra-record evidence in APA cases. See Cachil Dehe Band of Wintun Indians of

14

Colusa Indian Cmty. v. Zinke, 889 F.3d 584, 600 (9th Cir. 2018).

15

Plaintiffs’ passing reference to a claim of animus likewise does not provide a basis to

16

permit extra-record discovery. ECF No. 87 at 3; ECF No. 92 at 8. Lilly Inv., LLC v. City of

17

Rochester, is inapposite because no federal agency was involved and the APA did not apply. No.

18

14-CV-10712, 2015 WL 753491, at *10 (E.D. Mich. Feb. 23, 2015). Plaintiffs cite an order

19

permitting discovery in California v. Ross, 18-cv-01865-RS, ECF No. 76, but that dispute (over

20

the addition of a question to the census) involves allegations not present here. Indeed, the Ross

21

court expressly tied its discovery order to a Southern District of New York court addressing the

22

same issue, where “the Court found that Plaintiffs had made a ‘strong showing’ of pretext or bad

23

faith on the part of agency decision-makers and, applying well-established precedent, thus

24

authorized discovery beyond the administrative record.” New York v. U.S. Dep’t of Commerce,

25

No. 18-CV-2921 (JMF), 2018 WL 5791968, at *1 (S.D.N.Y. Nov. 5, 2018). Here, the gravamen

26

of Plaintiffs’ claim is that the policy lacks a rational basis, not that it was motivated by xenophobic

27

animus. See Compl., ECF No. 1 ¶ 65 (“Moreover, given the absence of any evidence of a

28

legitimate rationale, it is difficult to conceive of any motivation, other than animus, for the DoD
4

1

making it more difficult for qualified immigrants to join the military.”). Plaintiffs’ additional

2

allegations of a general motif of executive actions adverse to immigrants with lawful status, see id.

3

¶¶ 66-70, are insufficient to support extra-record discovery into DoD’s motivations.2
Accordingly, the Court denies Plaintiffs’ request for extra-record discovery on the merits

4
5

of their constitutional claims.

6

B.

Equitable Relief

7

In its prior order, the Court concluded that it was “not limited to the administrative record”

8

when “assessing how the issuance of an injunction may harm the public interest.” ECF No. 68 at

9

48 (quoting Nat. Res. Def. Council, Inc. v. Evans, No. C-02-3805-EDL, 2003 WL 22025005, at *1
(N.D. Cal. Aug. 26, 2003)). DoD does not dispute that proposition. See ECF No. 74 at 9-10.

11

United States District Court
Northern District of California

10

Rather, DoD argues that the default relief in APA cases is vacating the agency action, not issuing a

12

permanent injunction. ECF No. 87 at 5-6.
The Court agrees with DoD that “[w]hen a court finds an agency’s decision unlawful under

13
14

the [APA], vacatur is the standard remedy.” Klamath-Siskiyou Wildlands Ctr. v. Nat’l Oceanic &

15

Atmospheric Admin. Nat’l Marine Fisheries Serv., 109 F. Supp. 3d 1238, 1241 (N.D. Cal. 2015)

16

(citing 5 U.S.C. § 706(2)(A)); see also Se. Alaska Conservation Council v. U.S. Army Corps of

17

Eng’rs, 486 F.3d 638, 654 (9th Cir. 2007), rev’d on other grounds sub nom. Coeur Alaska, Inc. v.

18

Se. Alaska Conservation Council, 557 U.S. 261 (2009). But, as “standard” implies, it is not the

19

only remedy. In the event that the Court finds the October 13 Memo unlawful, both parties will

20

have the opportunity to advocate for more or less relief than the normal vacatur and remand.
For their part, Plaintiffs may seek injunctive relief in addition to vacatur. See W.

21
22

Watersheds Project v. Abbey, 719 F.3d 1035, 1054 (9th Cir. 2013) (seeking permanent injunctive

23

relief to “limit grazing in riparian areas until the [agency] complie[d]” with its statutory

24

obligations on remand). DoD aptly notes that “[i]f a less drastic remedy (such as partial or

25

complete vacatur of [the agency’s] decision) [i]s sufficient to redress [Plaintiffs’] injury, no

26
27
28

2

Because Plaintiffs have made no showing on this question, the Court need not determine the
degree to which this inquiry overlaps with the “bad faith” exception to supplementing the
administrative record. Cachil Dehe Band of Wintun Indians, 889 F.3d at 600.
5

1

recourse to the additional and extraordinary relief of an injunction [would be] warranted.”

2

Monsanto Co. v. Geertson Seed Farms, 561 U.S. 139, 165-66 (2010). Nevertheless, DoD cites no

3

case making that determination at the outset of discovery as a basis for dispensing with discovery

4

altogether.
Conversely, DoD has not foreclosed the possibility that it will seek remand without

5

vacatur. See All. for the Wild Rockies v. U.S. Forest Serv., 907 F.3d 1105, 1121 (9th Cir. 2018)

7

(“When equity demands, however, the [action] can be left in place while the agency reconsiders or

8

replaces the action, or to give the agency time to follow the necessary procedures.” (emphasis

9

added)). In making this determination, courts consider “how serious the agency’s errors are ‘and

10

the disruptive consequences of an interim change that may itself be changed.’” Cal. Communities

11

United States District Court
Northern District of California

6

Against Toxics v. U.S. E.P.A., 688 F.3d 989, 992 (9th Cir. 2012) (per curiam) (quoting Allied-

12

Signal, Inc. v. U.S. Nuclear Regulatory Comm’n, 988 F.2d 146, 150-51 (D.C. Cir. 1993)). Given

13

DoD’s past reliance on extra-record materials in seeking a stay of the Court’s preliminary

14

injunction, ECF No. 74-1, the Court cannot foreclose the possibility that that DoD will seek to rely

15

on similar materials in the future.
In sum, “[a] federal court ‘is not required to set aside every unlawful agency action,’ and

16
17

the ‘decision to grant or deny injunctive or declaratory relief under APA is controlled by

18

principles of equity.’” Id. (quoting Nat'l Wildlife Fed’n v. Espy, 45 F.3d 1337, 1343 (9th Cir.

19

1995)). Both parties appear likely to advocate that the Court depart from the standard remedy in

20

the event that the Court finds in favor of Plaintiffs on the merits. Unless the parties stipulate to

21

seeking no additional relief, the Court has no basis to bar discovery on these equitable questions.3

22

CONCLUSION

23

For the foregoing reasons, the Court denies Plaintiffs’ request for extra-record discovery

24

on the merits of their constitutional claims. The Court grants Plaintiffs’ request for extra-record

25

discovery on equitable factors relevant to potential relief. The resolution of these threshold

26
27
28

DoD also argues that Plaintiffs’ initial discovery requests are not relevant to the equitable factors.
ECF No. 87 at 6. In this order, the Court merely decides the threshold question whether any
discovery is appropriate. Whether any specific request is appropriate is a question for another day.
6
3

1

questions does not preclude the parties from seeking to otherwise supplement the administrative

2

record, nor does it address the propriety of any particular discovery requests.

3

As discussed at the January 16, 2019 case management conference, the parties shall submit

4

either a stipulated proposed schedule for the remainder of the action or competing proposed

5

schedules. This submission is due by January 30, 2019. If the parties submit competing

6

proposals, the Court will endeavor to choose, in all respects, the single proposal it concludes is

7

most reasonable. See Michael Carrell & Richard Bales, Considering Final Offer Arbitration to

8

Resolve Public Sector Impasses in Times of Concession Bargaining, 28 Ohio St. J. on Disp. Resol.

9

1, 20 (2013) (“In baseball arbitration . . . the parties . . . have every incentive to make a reasonable

10

United States District Court
Northern District of California

11
12
13
14

proposal to the arbitrator because the arbitrator will choose the more reasonable offer.”).
IT IS SO ORDERED.
Dated: January 23, 2019
______________________________________
JON S. TIGAR
United States District Judge

15
16
17
18
19
20
21
22
23
24
25
26
27
28
7