The City & County of San Francisco v. United States Department of Transportation et al, No. 3:2012cv00711 - Document 44 (N.D. Cal. 2013)

Court Description: ORDER GRANTING MOTION TO DISMISS. Signed by Judge Richard Seeborg on 2/28/13. (cl, COURT STAFF) (Filed on 2/28/2013)
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The City & County of San Francisco v. United States Department of Transportation et al Doc. 44 1 2 3 4 5 6 7 IN THE UNITED STATES DISTRICT COURT 8 FOR THE NORTHERN DISTRICT OF CALIFORNIA 9 SAN FRANCISCO DIVISION 11 For the Northern District of California United States District Court 10 12 13 14 No. C 12-0711 RS THE CITY AND COUNTY OF SAN FRANCISCO, ORDER GRANTING MOTION TO DISMISS Plaintiff, v. UNITED STATES DEPARTMENT OF TRANSPORTATION, et al., 15 16 Defendants. ____________________________________/ 17 18 I. INTRODUCTION 19 In this action, plaintiff the City and County of San Francisco (“the City”) seeks declaratory 20 and injunctive relief to compel the United States Department of Transportation, through the federal 21 Pipeline and Hazardous Materials Agency (“PHMSA”), to exercise more stringent oversight of the 22 California Public Utilities Commission (“CPUC”) with respect to the CPUC’s delegated 23 responsibility to enforce federal natural gas pipeline safety standards in California. The City’s 24 original complaint was framed as a citizen’s suit under the Natural Gas Pipeline Safety Act, Pub. L. 25 90-481, 82 Stat. 720 (“PSA”). Those claims were dismissed, but the City was given leave to amend 26 to attempt to state a claim under the Administrative Procedures Act (“APA”). Defendants now 27 move to dismiss the Amended Complaint, contending the City has failed to allege the narrow kinds 28 of agency action or inaction that would be subject to judicial review under the APA. 1 1 II. BACKGROUND 2 Prior to 1968, regulation of natural gas pipelines was left entirely to the states. That year, 3 4 Congress enacted the Natural Gas Pipeline Safety Act, Pub. L. 90-481, 82 Stat. 720 (“PSA”) “to 5 provide adequate protection against risks to life and property posed by pipeline transportation and 6 pipeline facilities.” 49 U.S.C. § 60102(a)(1). Pursuant to that law and subsequent amendments, the 7 Secretary of Transportation has delegated authority to PHMSA to adopt minimum safety standards 8 for the design, construction, testing, operation and maintenance of natural gas and hazardous liquid 9 pipelines. 49 C.F.R. § 1.53. See 49 C.F.R. parts 190-99. Under the regulatory scheme, states may assume responsibility for regulating intrastate gas pipeline facilities by submitting an annual 11 For the Northern District of California United States District Court 10 certification to the Secretary pursuant to section 5 of Pub. L. No. 90-481 (originally codified at 49 12 U.S.C. § 1674; currently codified as amended at 49 U.S.C. §60105). If a state does so, the Secretary 13 is prohibited from enforcing safety standards or practices for intrastate gas pipelines in that state. Id. 14 If the Secretary determines, however, that a state is not “satisfactorily enforcing compliance” with 15 the federal standards, he has the discretion to reject the certification or take other appropriate action 16 to achieve adequate enforcement, including asserting federal jurisdiction over intrastate facilities. 17 Id. 18 Since the 1970s, California has, through the CPUC, submitted an annual certification to the 19 Secretary to regulate all intrastate natural gas pipelines in the state, except for certain pipelines that 20 are beyond the scope of its authority, which remain subject to federal regulation. The submission of 21 that certification makes CPUC eligible to receive federal funding for up to 80% of the costs 22 reasonably required to administer its pipeline safety program pursuant to 49 U.S.C. § 60107(a)(1). 23 In this action, the City complains, in essence, that the federal regulators have abdicated their 24 responsibility to exercise sufficient oversight to ensure that the CPUC is complying with its duties 25 under the certification to enforce federal pipeline safety standards in California. 26 The City alleges that as a consequence of inadequate federal oversight, the CPUC has 27 allowed the Pacific Gas & Electric Company (“PG&E”) to violate minimum federal safety standards 28 “blatantly,” which in turn has led to numerous catastrophic events, including the pipeline explosion 2 1 in San Bruno, California in 2010. The San Bruno explosion and resulting fire killed eight people, 2 injured fifty, and destroyed or damaged more than one hundred homes. The City also points to a 3 2008 pipeline explosion in Rancho Cordova, California that killed one and injured five, and an 4 incident in Cupertino, California in 2011 that caused extensive property damage. 5 Alleging that further such incidents are inevitable, and that persons and property within the declaratory and injunctive relief. Specifically, the City requests an injunction requiring the 8 Secretary, the Department of Transportation, PHMSA, and its administrator (1) to “comply with 9 their duty to oversee certified state authorities and to ensure that federal pipeline safety standards are 10 enforced;” (2) to cease “improperly delegating their authority to do so to gas pipeline operators like 11 For the Northern District of California City and County of San Francisco are therefore facing an imminent risk of harm, the City seeks 7 United States District Court 6 PG&E,” and; (3) “to only disburse federal funds to a state authority that are reasonably required to 12 carry out a pipeline safety program in compliance with the authority’s certification to PHMSA.” 13 The amended complaint also includes other formulations of requested declaratory and injunctive 14 relief in essentially the same vein, with more details, and more tailored to echo the language of APA 15 actions. 16 The amended complaint contains four claims for relief. The first two are those from the 17 original complaint brought directly under the PSA, as to which leave to amend was not granted. 18 The City explains that it has repleaded them merely to preserve its appellate rights, and does not 19 seek to defend them in its opposition to the present motion to dismiss. Accordingly, those claims 20 will again be dismissed, without leave. The City’s third claim for relief is brought under section 21 706(1) of the APA, 5 U.S.C. § 706(1), and asserts that defendants have “unlawfully withheld” 22 “agency action.” The fourth claim for relief invokes section 706(2) of the APA, 5 U.S.C. § 706(2), 23 and claims defendants’ conduct has been “arbitrary, capricious and an abuse of discretion.” 24 25 26 III. LEGAL STANDARD Defendants’ motion invokes both Rule 12(b)(1) and Rule 12(b)(6) of the Federal Rules of 27 Civil Procedure. In challenging the original complaint, defendants relied on Rule 12(b)(1) at least in 28 part because they were arguing that the City lacked standing, thereby depriving the Court of 3 1 jurisdiction. In the present motion, defendants have not clearly articulated why either or both of the 2 rules apply, but the gravamen of their motion is that the City has failed to state a claim, an argument 3 sounding primarily under Rule 12(b)(6). 4 A complaint must contain “a short and plain statement of the claim showing that the pleader 5 is entitled to relief.” Fed. R. Civ. P. 8(a)(2). While “detailed factual allegations are not required,” a 6 complaint must include sufficient facts to “state a claim to relief that is plausible on its face.” 7 Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009) (citing Bell Atlantic Corp. v. Twombly, 550 US 544, 8 570 (2007)). A claim is facially plausible “when the pleaded factual content allows the court to 9 draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. Rule 12(b)(1) is also relevant, however, because absent a tenable APA claim, there is no 11 For the Northern District of California United States District Court 10 subject matter jurisdiction to review alleged agency inaction. See Ecology Center, Inc. v. United 12 States Forest Service, 192 F.3d 922, 926 (9th Cir. 1999). A motion to dismiss for lack of subject 13 matter jurisdiction may be made on the grounds that the lack of jurisdiction appears from the “face 14 of the complaint,” or may be based on extrinsic evidence apart from the pleadings. Warren v. Fox 15 Family Worldwide, Inc., 328 F.3d 1136, 1139 (9th Cir. 2003); McMorgan & Co. v. First Cal. 16 Mortgage Co., 916 F. Supp. 966, 973 (N.D. Cal. 1995). 17 IV. DISCUSSION 18 19 A. Section 706(1) 20 There is no dispute that a claim under §706(1) of the APA “can proceed only where a 21 plaintiff asserts that an agency failed to take a discrete agency action that it is required to take . . . . 22 [C]ourts do not have the authority to enter general orders compelling compliance with broad 23 statutory mandates.” Gros Ventre Tribe v. United States, 469 F.3d 801, 814 (9th Cir. 2006) 24 (emphasis in original, internal citations and quotes omitted)). “§ 706(1) empowers a court to 25 compel an agency only ‘to perform a ministerial or non-discretionary act.’” Norton v. Southern Utah 26 Wilderness Alliance, 542 U.S. 55, 64 (2004). 27 28 Defendants contend the amended complaint runs afoul of this principle because, at heart, the City is merely leveling a “broad attack on a Federal program for allegedly failing to achieve its 4 1 general statutory objectives,” which is impermissible under Norton. See id. at 64. Defendants argue 2 that the amended complaint’s multiple references to “mandatory” duties are only labels and legal 3 conclusions, which can and should be disregarded. Apart from those conclusory assertions, 4 defendants contend, the amended complaint identifies no ministerial act or non-discretionary duty 5 that they have allegedly failed to perform. The City, in turn, insists it has adequately alleged that the Secretary is charged with two non- 6 7 discretionary duties: (1) the duty to decide whether a State authority is satisfactorily enforcing 8 federal pipeline safety standards before accepting a State certification of enforcement or disbursing 9 federal funds; and (2) the duty to take “appropriate action to achieve adequate enforcement,” applicable if the Secretary decides that a State authority is not satisfactorily enforcing those safety 11 For the Northern District of California United States District Court 10 standards. The City argues a tenable APA claim arises from “[d]efendants’ wholesale abdication of 12 their duty to ensure that State authorities are actually enforcing federal safety standards through the 13 promulgation of a minimum standard setting the benchmark for state agency performance.” The City relies on a Tenth Circuit decision, Estate of Smith v. Heckler, 747 F.2d 583 (10th 14 15 Cir. 1984), in which the plaintiffs challenged the approach of the Secretary of Health and Human 16 Services to reviewing the adequacy of states’ certifications that care given to Medicaid recipients in 17 those states met federal standards.1 Defendants respond that Estate of Smith is distinguishable, on 18 grounds that the requirements imposed by the Medicaid Act on the Secretary were, in defendants’ 19 view, more detailed and specific than those imposed by the PSA. Defendants also argue that the 20 Tenth Circuit’s approach to the APA has not been consistent with that of the Ninth Circuit, and that 21 Estate of Smith predates the Supreme Court’s broader enunciation of the governing principles in 22 Norton. More fundamentally, defendants argue that, contrary to the City’s underlying premise, they 23 24 in fact do evaluate the adequacy of the CPUC’s enforcement of federal pipeline safety standards. 25 26 27 28 1 This Tenth Circuit decision should not be confused with the better-known Supreme Court decision, Heckler v. Chaney, 470 U.S. 821 (1985), which held that an agency’s decision not to take enforcement action is not subject to judicial review. Defendants rely on Heckler v. Chaney insofar as the City’s claims can be characterized as a challenge to their failure to take enforcement actions. 5 1 Defendants point to 49 C.F.R. Part 198 which sets forth the performance factors they purportedly 2 use to determine whether States are satisfactorily carrying out a pipeline safety program and 3 whether, or to the extent which, PHMSA should provide grants-in-aid to assist the States in carrying 4 out their state pipeline programs under 49 U.S.C. § 60107. These factors include, the “quality of 5 state inspections, investigations, and enforcement/compliance actions.” 49 C.F.R. § 198.13(c). 6 Defendants have also pointed to permissive language in the PSA (i.e., repeated use of the 7 term “may”) regarding actions the Secretary is authorized to take to ensure compliance with federal 8 standards. That language is not dispositive, however, because defendants cannot and do not argue 9 that the Secretary has no mandatory duty to oversee state enforcement efforts. Indeed, defendants implicitly recognize as much, by contending instead that the ultimate deficiency in the City’s 11 For the Northern District of California United States District Court 10 complaint is that it is a challenge to how defendants are carrying out their duties, rather than a 12 legitimate claim of a failure to act. 13 On that point, defendants have the better argument. Section 706(1) does not provide a 14 vehicle for bringing “complaints about the sufficiency of an agency action ‘dressed up as an 15 agency’s failure to act.’” Ecology Center, 192 F.3d at 926 (quoting Nevada v. Watkins, 939 F.2d 16 710, 714 n. 11 (9th Cir. 1991)). Notwithstanding the City’s characterizations of its allegations, it 17 “has not pleaded a genuine § 706(1) claim.” Id. at 926. Accordingly the motion to dismiss must be 18 granted as to the third claim for relief. As there is no suggestion that other or additional facts could 19 be pleaded that would alter the fundamental and untenable nature of the claim the City is attempting 20 to bring, leave to amend will not be granted. 21 22 B. Section 706(2) 23 While not every claim under section 706(2) would be coextensive with a section 706(1) 24 claim, in this instance the City’s attempt to recast the same facts into a theory that defendants have 25 acted arbitrarily and capriciously adds nothing of substance. Accordingly, the fourth claim for relief 26 must also be dismissed, without leave to amend. 27 28 6 1 V. CONCLUSION 2 3 The motion to dismiss is granted. A separate judgment will issue. 4 5 IT IS SO ORDERED. 6 Dated: 2/28/13 7 8 RICHARD SEEBORG UNITED STATES DISTRICT JUDGE 9 11 For the Northern District of California United States District Court 10 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 7