NORTH CAROLINA GROWERS' ASSOCIATION, INC. et al
Filing
139
MEMORANDUM OPINION AND ORDER signed by JUDGE WILLIAM L. OSTEEN JR. on 10/4/11 that Defendant-Intervenors' Motion for leave to File SupplementalMemorandum Regarding Mootness (Doc. 138 ) is GRANTED. IT IS FURTHER ORDERED that Plaintiffs' Mot ion for Summary Judgment (Doc. 124 ) is DENIED AS MOOT as to the Federal Defendants. This court retains jurisdiction as to the FederalDefendants pending a final order as to Plaintiffs' claim for attorneys' fees pursuant to the Equal Access to Justice Act, 28 U.S.C. § 2412. IT IS FURTHER ORDERED that Plaintiffs' Motion for Summary Judgment (Doc. 124 ) is GRANTED as to Defendant-Intervenors and Defendant-Intervenors' Motions for Partial Summary Judgment (Docs. 131 , [13 2]) are DENIED. IT IS FURTHER ORDERED that a PERMANENT INJUNCTION is hereby issued, enjoining the implementation of the Substitution Rule (Temporary Employment of H-2A Aliens in the United States, 74Fed. Reg. 25,972 (May 29, 2009)) and denying recove ry by Defendant-Intervenors pursuant to their counterclaims by or under the rules set out in Temporary Employment of H-2A Aliens in the United States, 74 Fed. Reg. 25,972 (May 29, 2009). IT IS FURTHER ORDERED that Defendant-Intervenors' claims areDISMISSED WITH PREJUDICE. (Wilson, JoAnne)
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF NORTH CAROLINA
NORTH CAROLINA GROWERS’
ASSOCIATION, INC., NATIONAL
CHRISTMAS TREE ASSOCIATION,
FLORIDA FRUIT &
VEGETABLE ASSOCIATION, INC.,
VIRGINIA AGRICULTURAL GROWERS
ASSOCIATION, INC., SNAKE
RIVER FARMERS ASSOCIATION,
NATIONAL COUNCIL OF
AGRICULTURAL EMPLOYERS,
NORTH CAROLINA CHRISTMAS
TREE ASSOCIATION, NORTH
CAROLINA PICKLE PRODUCERS
ASSOCIATION, FLORIDA CITRUS
MUTUAL, NORTH CAROLINA
AGRIBUSINESS COUNCIL, INC.,
MAINE FOREST PRODUCTS COUNCIL,
ALTA CITRUS, LLC, EVERGLADES
HARVESTING & HAULING, INC.,
DESOTO FRUIT AND HARVESTING,
INC., FOREST RESOURCES
ASSOCIATION, TITAN PEACH
FARMS, INC., H-2A USA, INC.,
and OVERLOOK HARVESTING
COMPANY, LLC,
Plaintiffs,
v.
HILDA L. SOLIS, in her
official capacity as United
States Secretary of Labor,
UNITED STATES DEPARTMENT OF
LABOR, JANET NAPOLITANO, in
her official capacity as
United States Secretary of
Homeland Security, and
UNITED STATES DEPARTMENT OF
HOMELAND SECURITY,
Defendants,
and
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1:09CV411
UNITED FARM WORKERS,
JAMES CEASE,
MARIO CENTENO-RODRIGUEZ,
JUAN CISNEROS-IBARRA,
LUIS ENRIQUE CISNEROS-IBARRA,
REYMUNDO GUTIERREZ,
CARLOS LUIS GUZMAN-AVILA,
JUAN LUIS GUZMAN-CENTENO,
JOSE RAUL GUZMAN-CENTENO,
ABELARDO HERNANDEZ-AGUAS,
GREGORIO HUERTAS-SAMANO,
PEDRO IBARRA-AVILA,
ATANACIO LUGO-RINCON,
OBDULA MALDONADO-ABELLANEDA,
MIGUEL ANGEL OLGUIN-HERNANDEZ,
ARTURO OLGUIN-MONROY,
OMERA RODRIGUEZ-GUZMAN,
DESIDERIO TOVAR-ZAPATA, and
ALEJANDRO TREJO-LEON,
on behalf of themselves and
all others similarly situated,
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Defendant-Intervenors.
MEMORANDUM OPINION AND ORDER
OSTEEN, JR., DISTRICT JUDGE.
Before the court are Plaintiffs’ Motion for Summary Judgment
(Doc. 124) and Defendant-Intervenors’ Motions for Partial Summary
Judgment (Docs. 131, 132).
Plaintiffs allege that the Department
of Labor (“DOL”) suspended a rule and imposed a new rule without
following the requisite procedures for “rule making” as set forth
in the Administrative Procedure Act (“APA”), 5 U.S.C. §§ 553 and
701 et seq.
All Defendants contend that DOL’s rule making
complied with the requirements of the APA.
2
Defendant-Intervenors
also contend that they are entitled to the recovery of certain
wages based upon DOL’s rules which were not implemented during
this court’s preliminary injunction.
Also pending before this court is Defendant-Intervenors
Motion for Leave to File Supplemental Memorandum Regarding
Mootness (“Supplemental Memorandum”). (Doc. 138.)
Because that
memo addresses the issue of mootness in relation to the summary
judgment pleadings, the motion will be allowed.
Defendant-
Intervenors are not required to separately file the Supplemental
Memorandum.
For the reasons set forth herein, Plaintiffs’ motion for
summary judgment will be granted and Defendant-Intervenors’
motions for partial summary judgment will be denied.
I.
FACTS1
The Immigration and Nationality Act of 1952, as amended,
provides a means by which employers may legally obtain temporary
services of foreign agricultural workers when American workers
are not available and classifies those foreign workers as
“(H)(ii)(a)” (“H-2A”).
8 U.S.C. § 1101(a)(15)(H)(ii)(a).
The
Department of Labor and Department of Homeland Security are the
1
The relevant facts of this case are largely undisputed and
are more thoroughly set out in Plaintiffs’ brief in support of
their motion for preliminary injunction (Doc. 3) and in the
Federal Defendants’ response to the motion for preliminary
injunction (Doc. 36). The facts are summarized in this opinion
and order.
3
agencies responsible for creating the regulations necessary to
implement the H-2A program and for administering that program.
The H-2B program is a similar program originally directed to
logging workers in the forest products industry.2
See id. §
1101(a)(15)(H)(ii)(b).
Congress delegated to the Secretary of Labor the authority
to implement the H-2A certification program through
administrative rule making.
See Immigration Reform and Control
Act of 1986, Pub. L. No. 99-603, § 301(e), 100 Stat. 3359.
Farmers must be “certified” by DOL to participate in the H-2A
program.
To obtain certification, the contracts the farmers
enter into with their workers must comply with the H-2A rules and
regulations in effect at that time.
(removed Feb. 12, 2010).
See 20 C.F.R. § 655.105
The rules and regulations cover a
variety of issues related to the H-2A program, including wages to
be paid the foreign workers.
See 8 U.S.C. § 1188(a)(1); see
also, e.g., 20 C.F.R. § 655.105(g) (removed Feb. 12, 2010).
For
example, the Adverse Effective Wage Rate (“AEWR”) sets the wage
rate, and the AEWRs set by DOL’s H-2A rules affect the wage rates
in the applicable labor markets.
A rule raising the AEWR
2
Under the 1987 Rule, the H-2A and H-2B programs had
separate rules. When the 2008 Rule was implemented, the H-2B
program was incorporated into the H-2A process. Thus, for
purposes of this order, the rule making process is referred to as
the H-2A program even though the H-2B rules are affected by this
rule making process as well.
4
increases the market wage rate.
Correspondingly, a rule lowering
the AEWR decreases the market wage rate.
See Indus.
Holographics, Inc. v. Donovan, 722 F.2d 1362, 1367 (7th Cir.
1983) (stating that the assumption that employment of an alien at
wages below the prevailing wage will tend to affect the wages of
American workers is not arbitrary or capricious).
In 1987, DOL promulgated a series of regulations governing
the H-2A program (collectively referred to herein as “the 1987
Rule”) that largely remained in effect until 2008, when DOL
promulgated new H-2A regulations (“the 2008 Rule”) and eliminated
the 1987 Rule.
2009.
The 2008 Rule became effective on January 17,
See Temporary Agricultural Employment of H-2A Aliens in
the United States; Modernizing the Labor Certification Process
and Enforcement, 73 Fed. Reg. 77,110, 77,110 (Dec. 18, 2008).
The 2008 Rule was created to fix various perceived problems with
the 1987 Rule.
See id.
For example, the 2008 Rule was designed
to eliminate duplicative H-2A activities, more rigorously
penalize noncompliant entities, and protect workers.
Id.
On March 17, 2009, DOL issued a notice of proposed rule
making (“the 2009 NPRM”), proposing to “suspend” the 2008 Rule
for nine months and reinstate the 1987 Rule “[t]o avoid the
regulatory vacuum that would result” from that suspension.
Temporary Employment of H-2A Aliens in the United States, 74 Fed.
Reg. 11,408, 11,408 (Mar. 17, 2009).
5
DOL specified a ten-day
comment period for the 2009 NPRM.
Id.
The 2009 NPRM advised
interested parties that DOL would not consider certain comments
in promulgating any rule that might arise from the notice:
Please provide written comments only on whether the
Department should suspend the December 18, 2008 final
rule for further review and consideration of the issues
that have arisen since the final rule’s publication.
Comments concerning the substance or merits of the
December 18, 2008 final rule or the prior rule will not
be considered.
Id. (emphasis added).
The “prior rule” reference was to the 1987
Rule, which was to be reinstated during the suspension period.
On May 29, 2009, consistent with the 2009 NPRM, DOL issued a
new H-2A rule (“the Substitution Rule”), scheduled to take effect
on June 29, 2009, and summarized as follows:
The Department of Labor (DOL or Department) is suspending
the H-2A Final Rule published on December 18, 2008 and in
effect as of January 17, 2009. . . . To ensure continued
functioning of the H-2A program, the Department is
republishing and reinstating the regulations in place on
January 16, 2009 for a period of 9 months, after which
the Department will either have engaged in further
rulemaking or lift the suspension.
Temporary Employment of H-2A Aliens in the United States, 74 Fed.
Reg. 25,972, 25,972 (May 29, 2009).
With regard to the scope-of-
comment restriction contained in the 2009 NPRM, the Substitution
Rule states:
[I]n the Notice, the Department requested that parties
limit their comments to the issue of whether the
Department should suspend the December 2008 Rule for
further review and consideration of the issues that
have arisen since the December 2008 Rule’s publication.
Though all comments have been reviewed, only those
comments responding to issues on which the Department
6
sought comment were considered in this Final Rule.
Id. at 25,973.
On June 9, 2009, North Carolina Growers’ Association, Inc.;
National Christmas Tree Association; Florida Fruit & Vegetable
Association, Inc.; Virginia Agricultural Growers Association,
Inc.; Snake River Farmers Association; National Council of
Agricultural Employers; North Carolina Christmas Tree
Association; North Carolina Pickle Producers Association; Florida
Citrus Mutual; North Carolina Agribusiness Council, Inc.; Maine
Forest Products Council; Alta Citrus, LLC; Everglades Harvesting
& Hauling, Inc.; Desoto Fruit and Harvesting, Inc.; Forest
Resources Association; Titan Peach Farms, Inc.; H-2A USA, Inc.;
and Overlook Harvesting Company, LLC (collectively, “Plaintiffs”)
filed a Complaint naming as defendants DOL, Hilda L. Solis in her
official capacity as Secretary of DOL, the Department of Homeland
Security (“DHS”), and Janet Napolitano in her official capacity
as Secretary of DHS (collectively, “the Federal Defendants”).
(Doc. 1 at 1-3.)
Plaintiffs allege that the Federal Defendants
violated the APA, 5 U.S.C. §§ 553 and 701 et seq., in formulating
the Substitution Rule.
(Compl. (Doc. 1) ¶¶ 54-86.)
Plaintiffs
are all farm operators or foresters that have an interest in, and
are impacted by, the H-2A and H-2B programs and the regulations
of those programs.
On June 18, 2009, United Farm Workers, James Cease, Mario
7
Centeno-Rodriguez, Juan Cisneros-Ibarra, Luis Enrique CisnerosIbarra, Reymundo Gutierrez, Carlos Luis Guzman-Avila, Juan Luis
Guzman-Centeno, Jose Raul Guzman-Centeno, Abelardo HernandezAguas, Gregorio Huertas-Samano, Pedro Ibarra-Avila, Atanacio
Lugo-Rincon, Obdula Maldonado-Abellaneda, Miguel Angel OlguinHernandez, Arturo Olguin-Monroy, Omera Rodriguez-Guzman,
Desiderio Tovar-Zapata, and Alejandro Trejo-Leon (collectively,
“Defendant-Intervenors”) filed a Motion to Intervene as Parties
Defendant (Doc. 37).
The court granted Defendant-Intervenors’
motion to intervene.
(Doc. 90 at 3.)
Defendant-Intervenors
support the Substitution Rule and, pursuant to that rule, filed
counterclaims seeking to recover the higher wage rates payable
under the Substitution Rule’s AEWR rather than the lower wage
rates which were actually implemented pursuant to the 2008 Rule
during the period in which this court’s injunction was pending.
This wage rate issue that arose as a result of the two
conflicting rules is referred to herein as the “Wage
Differential.”
After this court entered an order granting Plaintiffs’
motion for a preliminary injunction (Doc. 59), DOL filed a new
notice of proposed rule making seeking to suspend the 2008 Rule
and implement a new rule.
See Temporary Agricultural Employment
of H-2A Aliens in the United States, 74 Fed. Reg. 45,906 (Sept.
4, 2009).
On February 12, 2010, DOL issued a final rule
8
regarding the H-2A program.
See Temporary Agricultural
Employment of H-2A Aliens in the United States, 75 Fed. Reg. 6884
(Feb. 12, 2010) (“the 2010 Rule”).
The 2010 Rule became
effective March 15, 2010, and is not at issue in this case.
However, the applicable DOL rules during the time period of June
2009 through March 2010, when implementation of the Substitution
Rule was enjoined by this court pending a final resolution on the
merits, are at issue.
All parties agree that during that time
period, DOL administered the H-2A program pursuant to the 2008
Rule and did not implement the Substitution Rule.
The parties
also agree that there is a Wage Differential between the 2008
Rule as administered during the pendency of the injunction and
the AEWR that would have been implemented pursuant to the
Substitution Rule.
II.
LEGAL STANDARDS
A.
Mootness as to the Federal Defendants
In response to Plaintiffs’ motion for summary judgment, the
Federal Defendants contend that
Plaintiffs’ claims for declaratory and injunctive
relief based on [the Substitution Rule] have been
rendered moot and Plaintiffs no longer have a live case
or controversy as to the Federal Defendants. Because
federal courts are forbidden from entertaining actions
without a case or controversy, this Court should
dismiss Plaintiffs’ claims against the Federal
Defendants.
(Defs.’ Opp’n Pls.’ Mot. Summ. J. (Doc. 126) at 4.)
Plaintiffs
agree with the Federal Defendants that the issues in this case
9
are moot as to the Federal Defendants except to note that
Plaintiffs will be seeking attorneys’ fees under the Equal Access
to Justice Act, 28 U.S.C. § 2412.
(See generally Pls.’ Reply
Government Defs. (Doc. 128) at 1-2.)
Plaintiffs’ Complaint seeks both declaratory and injunctive
relief with respect to the Substitution Rule.
(Doc. 1 at 34.)
To qualify as a case fit for federal-court
adjudication, an actual controversy must be extant at
all stages of review, not merely at the time the
complaint is filed. . . .
When a legislature amends or repeals a statute, a
case challenging the prior law can become moot even
where re-enactment of the statute at issue is within
the power of the legislature.
Brooks v. Vassar, 462 F.3d 341, 348 (4th Cir. 2006) (internal
quotation marks omitted).
Additionally, declaratory relief such
as Plaintiffs have sought in this case may be entered only when
“the challenged government activity . . . is not contingent, has
not evaporated or disappeared, and, by its continuing and
brooding presence, casts what may well be a substantial adverse
effect on the interests of the petitioning parties.”
Tire Eng’g Co. v. McCorkle, 416 U.S. 115, 122 (1974).
See Super
“The
question is whether the facts alleged, under all the
circumstances, show that there is a substantial controversy,
between parties having adverse legal interests, of sufficient
immediacy and reality to warrant the issuance of a declaratory
judgment.”
Id. (internal quotation marks omitted).
This court agrees with the parties that because the H-2A and
10
H-2B programs were administered under the 2008 Rule following
this court’s preliminary injunction until implementation of the
2010 Rule, this case is moot as to the Federal Defendants.
Accordingly, this case will be dismissed as moot as to the
Federal Defendants.3
However, as argued by Plaintiffs, because
of the Wage Differential issue and related counterclaims, this
matter is not moot as to Defendant-Intervenors.
This court will
therefore address summary judgment as to the remaining claims.4
B.
Summary Judgment
Summary judgment is appropriate where an examination of the
pleadings, affidavits, and other proper discovery materials
before the court demonstrates that no genuine issue of material
fact exists and that the moving party is entitled to judgment as
a matter of law.
See Fed. R. Civ. P. 56.
The moving party bears
the burden of initially demonstrating the absence of a genuine
3
5 U.S.C. § 702 provides “[t]hat any mandatory or
injunctive decree shall specify the Federal officer or officers.
. .personally responsible for compliance. This order contains an
injunction. Should the Federal Defendants be necessary parties
because of injunctive relief, then in the alternative this court
would apply the same analysis to Plaintiffs’ claims against the
Federal Defendants as set forth herein with respect to the
Intervenor-Defendants.
4
All parties’ summary judgment and partial summary judgment
briefs have argued either in response to, or in accordance with,
the substantive arguments contained in the Federal Defendants’
briefs. This court has considered the Federal Defendants’
substantive arguments as they relate to Plaintiffs’ motion for
summary judgment and Defendant-Intervenors’ motions for partial
summary judgment as adopted or responded to by Plaintiffs or
Defendant-Intervenors.
11
issue of material fact.
323 (1986).
Celotex Corp. v. Catrett, 477 U.S. 317,
If the moving party has met that burden, then the
nonmoving party must persuade the court that a genuine issue
remains for trial by “go[ing] beyond the pleadings” and
introducing evidence that establishes “specific facts showing
that there is a genuine issue for trial.”
Id. at 324 (internal
quotation marks omitted).
In considering a motion for summary judgment, the court is
not to weigh the evidence, but rather must determine whether
there is a genuine issue for trial.
Inc., 477 U.S. 242, 249 (1986).
Anderson v. Liberty Lobby,
The court must view the facts in
the light most favorable to the nonmovant, drawing all
justifiable inferences in that party’s favor.
Id. at 255.
A
mere factual dispute is insufficient to prevent summary judgment;
the fact in question must be material, and the dispute must be
genuine.
Fed. R. Civ. P. 56; Anderson, 477 U.S. at 247-48.
Material facts are those facts necessary to establish the
elements of a party’s cause of action.
248.
Anderson, 477 U.S. at
A dispute is only “genuine” if “the evidence is such that a
reasonable jury could return a verdict for the nonmoving party.”
Id.
C.
Review of Agency Action
“A person suffering legal wrong because of agency action, or
adversely affected or aggrieved by agency action within the
meaning of a relevant statute, is entitled to judicial review
12
thereof.”
5 U.S.C. § 702.
In reviewing agency action, “the
function of the district court is to determine whether or not as
a matter of law the evidence in the administrative record
permitted the agency to make the decision it did.
De novo
factfinding by the district court is allowed only in limited
circumstances.”
Occidental Eng’g Co. v. INS, 753 F.2d 766, 769
(9th Cir. 1985).
The focal point for judicial review should be the
administrative record already in existence, not some
new record made initially in the reviewing court. The
task of the reviewing court is to apply the appropriate
APA standard of review, 5 U.S.C. § 706, to the agency
decision based on the record the agency presents to the
reviewing court.
Fla. Power & Light Co. v. Lorion, 470 U.S. 729, 743-744 (1985)
(internal quotation marks and citation omitted).
“The APA
specifically contemplates judicial review on the basis of the
agency record compiled in the course of informal agency action in
which a hearing has not occurred.”
Id. at 744.
The Federal
Defendants have filed the agency record with this court and this
matter is ripe for review.
See Notice of Paper Filing (Doc.
123).
Judicial review of agency action is narrow.
Motor Vehicle
Mfrs. Ass’n of the U.S., Inc. v. State Farm Mut. Auto. Ins. Co.,
463 U.S. 29, 43 (1983).
A reviewing court may not substitute its
judgment for that of the agency.
Id.
However, an agency’s
action may be set aside if it is found to be “arbitrary,
capricious, an abuse of discretion, or otherwise not in
13
accordance with law.”
5 U.S.C. § 706(2)(A).
In conducting rule making pursuant to the APA, “the agency
must examine the relevant data and articulate a satisfactory
explanation for its action including a rational connection
between the facts found and the choice made.”
Motor Vehicle
Mfrs. Ass’n, 463 U.S. at 43 (internal quotation marks omitted).
Normally, an agency rule would be arbitrary and
capricious if the agency has relied on factors which
Congress has not intended it to consider, entirely failed
to consider an important aspect of the problem, offered
an explanation for its decision that runs counter to the
evidence before the agency, or is so implausible that it
could not be ascribed to a difference in view or the
product of agency expertise. The reviewing court should
not attempt itself to make up for such deficiencies . .
. .
Id.; see also Ohio River Valley Envtl. Coal. v. Kempthorne, 473
F.3d 94, 102 (4th Cir. 2006).
“Although the scope of review is
narrow, the agency must nevertheless explain the evidence which
is available, and must offer a rational connection between the
facts found and the choice made.”
Ohio River Valley, 473 F.3d at
102-103.
III. ANALYSIS
Under the APA, “rule making” is defined as an agency’s
“process for formulating, amending, or repealing a rule.”
U.S.C. § 551(5).
5
Section 553(c) of the APA requires that
agencies “give interested persons an opportunity to participate
in the rule making through submission of written data, views, or
14
arguments.”5
Id. § 553(c).
This court finds that the two
actions by DOL with respect to the Substitution Rule, that is,
the suspension of the 2008 Rule and reinstatement of the 1987
Rule, constituted “rule making” under §§ 551 and 553.6
In support of their motion for summary judgment, Plaintiffs
5
5 U.S.C. § 553(b) provides that the notice provisions do
not apply “when the agency for good cause finds (and incorporates
the finding and a brief statement of reasons therefor in the
rules issued) that notice and public procedure thereon are
impracticable, unnecessary, or contrary to public interest.” The
Federal Defendants do not contend this provision applies, nor is
there a finding and brief statement of reasons which would permit
suspension of the notice provisions.
6
The Substitution Rule is a “rule” as that term is defined
in the APA. Section 551(4) states that a “rule” is “the whole or
a part of an agency statement of general or particular
applicability and future effect designed to implement, interpret,
or prescribe law or policy.” 5 U.S.C. § 551(4). An act also
constitutes a “rule” if it is an “approval or prescription for
the future” of rates or wages. Id. Here, the Substitution Rule,
specifically the component that reinstates the 1987 Rule,
constituted a “rule” in that it implements the AEWRs with which
Plaintiffs must comply.
Notwithstanding the fact that the Supreme Court has
suggested that rule suspensions are permissible, see Motor
Vehicle Mfrs. Ass’n, 463 U.S. at 50 n.15 (“We think that it would
have been permissible for the agency to temporarily suspend the
passive restraint requirement . . . .”), it is not settled
whether rule suspensions constitute “rule making” under § 551(5)
and must therefore comply with § 553(c). Nevertheless, it is not
necessary to resolve this issue to determine whether Plaintiffs’
motion for summary judgment should be granted. Here, Defendants
did more than just suspend a set of regulations in promulgating
the Substitution Rule. In addition to withdrawing a rule,
Defendants effectively formulated a new rule by reinstating the
1987 Rule. As stated, the APA’s definition of “rule making”
explicitly covers rule formulation. 5 U.S.C. § 551(5) (defining
“rule making” as an agency’s “process for formulating, amending,
or repealing a rule” (emphasis added)). Accordingly, in order
for the Substitution Rule to be valid, DOL must have complied
with § 553(c) of the APA in reinstating the 1987 Rule.
15
argue that the 2009 NPRM’s scope-of-comment restriction violated
§ 553(c) of the APA because the restriction prohibited Plaintiffs
from participating in the making of the actual rule that DOL
proposed to implement, that is, the 1987 Rule.
See Temporary
Employment of H-2A Aliens in the United States, 74 Fed. Reg.
11,408, 11,408 (Mar. 17, 2009) (“Comments concerning the
substance or merits of the December 18, 2008 final rule or the
prior rule will not be considered.”).
Not only did DOL issue an
initial statement advising that it would not consider comments on
the substance or merits of the two rules, DOL in fact refused to
consider comments that it received as to those rules’ substance
and merits.
Temporary Employment of H-2A Aliens in the United
States, 74 Fed. Reg. 25,972, 25,973 (May 29, 2009) (“Though all
comments have been reviewed, only those comments responding to
issues on which [DOL] sought comment were considered in this
Final Rule.”).7
With respect to rule making, 5 U.S.C. § 553(c) provides:
After notice required by this section, the agency shall
give interested persons an opportunity to participate
in the rule making through submission of written data,
views, or arguments with or without opportunity for
7
In addition to avoiding the APA rule making procedures,
this limitation on comment review creates a separate issue with
respect to the judicial review provided for in 5 U.S.C. § 702.
Because of the comment limitation and the notation that “only
those comments responding to issues on which [DOL] sought comment
were considered in this Final Rule,” it is difficult for a
reviewing court to determine which comments were considered by
DOL. Thus, the procedure used by DOL in this rule making is, at
best, evasive as to judicial review of substantive provisions.
16
oral presentation. After consideration of the relevant
matter presented, the agency shall incorporate in the
rules adopted a concise general statement of their
basis and purpose.
5 U.S.C. § 553(c).
To comply with the notice and comment
provisions of § 553(c), “the agency must examine the relevant
data and articulate a satisfactory explanation for its action
including a rational connection between the facts found and the
choice made.”
Motor Vehicle Mfrs. Ass’n, 463 U.S. at 43.
DOL refused to accept and consider comments as to the 2008
Rule and the 1987 Rule even though the 2009 NPRM specifically
identified substantive issues which would be directly affected by
the proposed rule making.
Several stated reasons for the 2009
NPRM raise questions as to the propriety of the comment content
restriction.
However, of particular significance to DOL’s
comment restriction is the fact the 2009 NPRM stated that the
suspension of the 2008 Rule and the re-implementation of the
former H-2A rule were warranted because of “severe economic
conditions [now] facing the country.”
See Temporary Employment
of H-2A Aliens in the United States, 74 Fed. Reg. 25,972, 25,972
(May 29, 2009).
If severe economic conditions required a rule
suspension and re-implementation of the 1987 Rule, then comments
as to the substance and merits of the rules by persons affected
are relevant and important.
DOL’s refusal to consider such
comments constitutes a failure to “give interested persons an
opportunity to participate in the rule making through submission
17
of written data, views, or arguments.”
See 5 U.S.C. § 553(c).
Additionally, the refusal to consider the merits of the two rules
constitutes a “fail[ure] to consider . . . important aspect[s] of
the problem.”
See Motor Vehicles Mfrs. Ass’n, 463 U.S. at 43.
Not surprisingly, individuals providing comments noted the
lack of consideration of the substance and merits as to the
potential economic effects of the agency action.
One comment
stated that
[n]owhere in the Federal Register is the economic
impact of this precipitous rulemaking addressed by the
Department. It is inconceivable that after only six
weeks under regulations reviewed and then promulgated
in compliance with [the] APA, the Labor Department
could ascertain that a return to previous regulations
is economically beneficial to the Department, H2A
employers or workers.
Comment, Charles T. Hall, Jr., Mar. 21, 2009 (ETA-2008-00011070.1), DOL000113, DOL000114.
Similarly, another comment noted:
Our experience has shown the issued Adverse Effect Wage
Rate (AEWR) has had an overall detrimental effect on
the performance level of our harvesting workers. Under
the previous H-2A regulations the AEWR guaranteed wage
significantly exceeded both prevailing wage standards
and the Florida minimum wage rate. The artificially
high AEWR adversely impacted the workers’ motivation to
strive for desired productivity levels.
Comment, Ricke Kress, Mar. 26, 2009 (ETA-2008-0001-1156-cp),
DOL000283, DOL000284.
While this court makes no finding as to
whether these comments are accurate, the comments do appear to
address the substance and merits of the 2008 Rule and the 1987
Rule and therefore are the type of comments that were not
considered by DOL.
Although DOL did note in the Substitution
18
Rule that it received comments about the AEWR, it appears
consideration of those comments was limited only to the
suspension issue and did not extend to the merits of the choice
of rule during the suspension period.
See Temporary Employment
of H-2A Aliens in the United States, 74 Fed. Reg. 25,972, 25,977
(May 29, 2009) (“One of the primary reasons that the new
Administration wants to review the December 2008 Rule is
precisely to determine whether the generally reduced wage rates
under that rule are having a depressive effect on farmworker
wages.”).
It is clear that DOL determined the substance and
merits of the 1987 Rule were appropriate for current conditions
during the suspension.
DOL did so without considering merits
comments and without explaining the substance and merits of its
decision.
In addition to the comments DOL received, Plaintiffs have
presented evidence that they would have submitted additional
comments absent the scope-of-comment restriction contained in the
2009 NPRM.
(See Wicker Aff. (Doc. 4-3) at 29 (“Again, as with
the rest of the substance of the regulations governing the H-2A
program, the NCGA would like an opportunity to comment on
specific provisions . . . of the Department’s proposal . . . .
But according to the terms set by the Department in the Notice,
any comments on these subjects will not be considered . . . .”).)
It is undisputed that Plaintiffs were prejudiced by the comment
restriction.
See Columbia Venture LLC v. S.C. Wildlife Fed’n,
19
562 F.3d 290, 294 (4th Cir.) (per curiam) (“[T]he party who
claims deficient notice bears the burden of proving that any such
deficiency was prejudicial, and if that party fails to carry its
burden, the agency’s decision must be upheld.” (internal
quotation marks omitted)), cert. dismissed, 130 S. Ct. 418
(2009).
Indeed, the Substitution Rule recognized that at least
one affected party objected to the scope-of-comment limitation
and had comments it would like to offer.
Temporary Employment of
H-2A Aliens in the United States, 74 Fed. Reg. 25,972, 25,979
(May 29, 2009) (“An agricultural association objected to the
Department’s limitation of the scope of comments to the
suspension itself, as opposed to comments on the merits or
substance . . . .
The association stated that it has numerous
comments it would like to offer on both the current regulations,
as well as the prior regulations . . . .”).
In addition to the economic issues for which no comments as
to the substance and merits of the rules were solicited, the
Substitution Rule’s reinstatement of the 1987 Rule in its
entirety, see id. at 25,973, presents an additional issue for
which no comments as to substance or merits were considered.
The
Fourth Circuit Court of Appeals previously held that a regulation
contained within the 1987 Rule was invalid and harmed a party
that is a plaintiff in the current action.
See U.S. Dep’t of
Labor v. N.C. Growers Ass’n, Inc., 377 F.3d 345, 353 (4th Cir.
2004) (“[W]e hold that the cultivation, growing, and harvesting
20
of Christmas trees is agriculture as defined in § 203(f), and
that the employees of the Growers are thus exempt from the
overtime provisions of the FLSA.”).
The issues arising from this
classification were noted in at least one comment to DOL.
Comment, Gail Greenman, Mar. 26, 2009 (ETA-2008-0001-1169.1),
DOL000314, DOL000316 (“Since 2004, Christmas tree growers who
have adopted modern practices in the Fourth Circuit have been
considered agriculture for purpose[s] of the FLSA.
This has not
been the case for Christmas tree growers in the rest of the
country.
Until the Department implemented its current rules,
there was a lack of uniform standards across the country as to
the classification of Christmas tree operations.”).
Because this
comment is directed to the merits of the 1987 Rule, the comment
would not have been considered.
This is another instance in
which DOL failed to “examine the relevant data and articulate a
satisfactory explanation for its action.”
See Motor Vehicles
Mfrs. Ass’n, 463 U.S. at 43.
By prohibiting consideration and discussion of the substance
and merits of the rules subject to the 2009 NPRM, DOL “failed to
consider an important aspect of the problem” and failed to “offer
a rational connection between the facts found and the choice
made.”
See id. at 43, 52 (internal quotation marks omitted).
Although Plaintiffs and Defendant-Intervenors alike might be
familiar with the 1987 Rule, Defendant-Intervenors have presented
no authority which supports a proposition that temporary rule
21
reinstatements should be evaluated under a different legal
standard than that which is used in assessing the promulgation of
all other types of rules.8
As a result of the comment restrictions, the undisputed fact
that substantive comments were submitted and not considered, and
the fact that substantive comments were not submitted as a result
of the scope-of-comment limitations contained in the 2009 NPRM,
this court finds that the Federal Defendants’ formulation of the
Substitution Rule was arbitrary and capricious as that term is
used in 5 U.S.C. § 706(2)(A).
DOL openly failed to consider
comments concerning the substance and merits of the suspended
rule and the rule which was reinstated.
See Temporary Employment
of H-2A Aliens in the United States, 74 Fed. Reg. 25,972, 25,973
(May 29, 2009) (“Though all comments have been reviewed, only
those comments responding to issues on which [DOL] sought comment
were considered in this Final Rule.”).
Defendant-Intervenors
have not presented any authority or argument which adequately
explains the Federal Defendants’ refusal to consider the
substance and merits of the 1987 Rule, nor have they explained
why the evaluation of the substance and the merits of the 1987
8
The argument that reinstatement was necessary to avoid a
regulatory vacuum created by the suspension is not persuasive
because the suspension was self-imposed by the agency.
Notwithstanding the failure to comply with the APA, the
suspension process urged by the Federal Defendants, if taken to
its extreme, would permit a complete circumvention of the APA and
judicial review by the enactment of suspensions and temporary
implementations.
22
Rule and the 2008 Rule were not relevant issues that DOL was
required to consider.
See Motor Vehicle Mfrs. Ass’n, 463 U.S. at
43 (“[T]he agency must examine the relevant data and articulate a
satisfactory explanation for its action including a rational
connection between the facts found and the choice made.”
(internal quotation marks omitted)).
For the reasons set forth herein, this court finds that
Plaintiffs’ Motion for Summary Judgment (Doc. 124) should be
granted as to Defendant-Intervenors.
In light of this ruling and
following careful review, this court declines to impose the
measures suggested by Defendant-Intervenors in their Supplemental
Memorandum. (See Doc. 138 Ex. 1.)
IV.
CONCLUSION
For the reasons set forth herein, IT IS ORDERED that
Defendant-Intervenors’ Motion for leave to File Supplemental
Memorandum Regarding Mootness (Doc. 138) is GRANTED.
IT IS FURTHER ORDERED that Plaintiffs’ Motion for Summary
Judgment (Doc. 124) is DENIED AS MOOT as to the Federal
Defendants.
This court retains jurisdiction as to the Federal
Defendants pending a final order as to Plaintiffs’ claim for
attorneys’ fees pursuant to the Equal Access to Justice Act, 28
U.S.C. § 2412.
IT IS FURTHER ORDERED that Plaintiffs’ Motion for Summary
Judgment (Doc. 124) is GRANTED as to Defendant-Intervenors and
23
Defendant-Intervenors’ Motions for Partial Summary Judgment
(Docs. 131, 132) are DENIED.
IT IS FURTHER ORDERED that a PERMANENT INJUNCTION is hereby
issued, enjoining the implementation of the Substitution Rule
(Temporary Employment of H-2A Aliens in the United States, 74
Fed. Reg. 25,972 (May 29, 2009)) and denying recovery by
Defendant-Intervenors pursuant to their counterclaims by or under
the rules set out in Temporary Employment of H-2A Aliens in the
United States, 74 Fed. Reg. 25,972 (May 29, 2009).
IT IS FURTHER ORDERED that Defendant-Intervenors’ claims are
DISMISSED WITH PREJUDICE.
This the 4th day of October 2011.
United State District Judge
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