[00:00:01] Speaker 00:
Case number 17-10-03, Maine Council of the Atlantic Seamen Federation at Al's Petitioners

[00:00:50] Speaker 06:
Good morning.

[00:00:51] Speaker 06:
May I please the court?

[00:00:53] Speaker 06:
I'm Russell Pierce.

[00:00:54] Speaker 06:
This case is a petition for review by four conservation groups, the petitioners, in the state of Maine.

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The petition for review is challenging the biological opinion, and specifically the no jeopardy finding

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of a biological opinion issued by the National Marine Fisheries Service with respect to a license amendment proceeding before the Federal Energy Regulatory Commission.

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The listed species under the Endangered Species Act that is the subject of the biological opinion is the Gulf of Maine distinct population segment of Atlantic salmon.

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And the biological opinion specifically addresses the Kennebec River.

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The problem that was before the service in this Section 7 consultation is that there are four hydropower projects on the Kennebec River, beginning at the city of Waterville, upriver from the Head of Tide.

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These four projects

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completely impede the sea-run migration of the Atlantic salmon.

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And the critical component of the recovery and survival

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analysis for this species.

[00:02:34] Speaker 05:
Did you raise these challenges in the petition for rehearing with FERC, specifically?

[00:02:40] Speaker 06:
We contend that we did.

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How so?

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At the time of the application for rehearing, we had pending

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in the district court, in fact by that time it was with the First Circuit, a direct challenge to the biological opinion under the Administrative Procedures Act.

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We had been relying at that time on authorities such as Dow, agro-sciences that appeared to allow

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a direct challenge to a biological opinion before the Federal Action Agency, the Commission, issues an order.

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Ultimately, the First Circuit

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upheld the dismissal for lack of jurisdiction on the Section 825 LB exclusive jurisdiction provision.

[00:03:41] Speaker 05:
And is your argument that because you made clear the nature of your challenge in that litigation, that therefore you didn't need to raise it specifically before FERC?

[00:03:52] Speaker 06:
Well, what we did before, because the problem here is that the Commission cannot change the biological opinion.

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And so if the challenge is to the no jeopardy finding to the biological opinion, the commission can't alter any aspect of the final agency action of the service.

[00:04:16] Speaker 04:
I didn't actually read that argument in your brief.

[00:04:20] Speaker 04:
That's the reason why there's jurisdiction there.

[00:04:24] Speaker 04:
I thought your argument was you had raised it in the district court and in the First Circuit.

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You interpret certain words that Justice Souter said in his opinion as giving you the right to continue to raise it, and that constitutes reasonable cause, but this argument that

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They had no choice but to follow the buy-off.

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I don't see that argument.

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Is this something you're making now?

[00:04:51] Speaker 06:
No, really, it was addressed in our reply where we were discussing the Save the Sebastia Cook reasonable grounds because

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If we turn directly to the statute, Section 825 LB, exclusive jurisdiction statute, the requirement is that the objecting party urge on the commission the objection.

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We contend that we did in fact do that when we were making objections and comments to the license order

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We submitted our full complete district court petition as an annex to our objection and said, this is our challenge.

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All of these issues are our challenge to the biological opinion.

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The commission then issued its order amending license not addressing any of those challenges.

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Our application for rehearing then

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requested again made note of the fact that we had objected to the petition that there was a pending direct review action in the district court and asking on application for a hearing we asked the commission to defer ruling

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until in the event that the district court took jurisdiction over our direct action.

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And so in that context, we were again urging upon the commission our objections to the biological opinion.

[00:06:42] Speaker 04:
Why not just ask the commission to also

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You did challenge the biological opinion for the agency, right?

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Your comments challenged that.

[00:06:53] Speaker 04:
Yes.

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reconsideration, you ask them to reconsider their deferring to it, why didn't you also ask them to reconsider the validity of the biological opinion itself?

[00:07:12] Speaker 06:
Because they would not have had, the commission would not have had the power to alter the biological opinion.

[00:07:23] Speaker 04:
They would have to alter it, but

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Our cases don't say they're bound by the biological opinion.

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They only say they are deferred to it, but they don't have to.

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And in fact, the agency said that they had done an independent review.

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It's not just that the agency's position wasn't, we're bound, am I wrong?

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The agency said we did an independent review and we like it, whatever that means.

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And we like it is not the words they use, but you know it.

[00:07:54] Speaker 06:
Correct.

[00:07:54] Speaker 06:
Correct.

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But yes, the agent, the commission deferred to the service.

[00:07:58] Speaker 04:
But they also said they did an independent review.

[00:08:00] Speaker 06:
Yes, but specifically with respect to our challenge to the biological opinion, which is that the no jeopardy finding does not rationally flow from the facts, from the effects of the action and the assessment of the environmental baseline.

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In that respect, the commission also said that we would be undermining

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the consulting agency's expertise were we to second-guess the no jeopardy findings.

[00:08:39] Speaker 04:
But you could ask that that be reconsidered, and that's what you're asking here, actually, that we consider that.

[00:08:47] Speaker 06:
Correct.

[00:08:47] Speaker 06:
Yeah, the question is, as a matter of form,

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Should we have, again, on the application of rehearing, annexed our arguments and issues laid out in the petition for review that was already pending, put a statement of issues heading on it, and asked the commission to undertake that review?

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Jurisdictional questions are more than a matter of form, aren't they?

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I mean, I think at least what I'm concerned with is whether we have the authority

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to consider arguments now that were not first placed before the Commission.

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That's correct.

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The statute says we don't, right?

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I agree.

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It's not a matter of form.

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What my suggestion was is that the question of our having waived the urging the issue on the Commission

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may be a matter of form.

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The statute requires that we urge our objections on the commission.

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But there's also a provision in the statute that says unless there is reasonable grounds for failure to do so.

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And so even if you hold us to the... And so what would be the reasonable grounds here?

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All, number one, the commission could not change the biological opinion.

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And this is really a challenge to the service's final agency action.

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How about the commission knew the litigation was going on?

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And that is another, that's the other ground, reasonable ground.

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Do you have any cases that stand for that latter proposition?

[00:10:35] Speaker 06:
No, well, to the extent the Save the Sebastica case discusses the reasonable grounds provision, but no.

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Part of this was an unprecedented biological opinion in the first place, and by that I mean never before, to our knowledge, has the service

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engaged in its responsibilities under the Act to issue a biological opinion as final agency action, but in doing so has essentially said we will issue an interim

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biological opinion.

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Nowhere in the statute does it say that the service can say, this is what we, I'm paraphrasing, this is what we kind of think about jeopardy right now, but let's wait and see for seven years.

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Let's let you design and construct fish installation which we're uncertain about in terms of performance standards.

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which there's no analysis of the existing baseline condition that will continue the impoundment.

[00:11:48] Speaker 04:
I have sympathy for the argument that the agency knew about what your argument was, but it feels like that's foreclosed by our Indiana utility regulatory commission case.

[00:12:03] Speaker 04:
It says it matters not what the commission knew or should have known at the time.

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We're limited to the four corners of the request for re-hearing.

[00:12:15] Speaker 06:
Again, I would suggest that the statutory language of Section 825 LB, which contains the reasonable grounds exception, and also the statute requires only that our objections be urged on the commission, and the purpose for that is so that the... I get the whole argument, but...

[00:12:38] Speaker 04:
That was exactly what was debated in that Indiana Regulatory Commission case, and this panel is bound by that decision.

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So is there a distinction?

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This is exactly the question urged before the commission is quoted in the hearing.

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But the answer, according to the court, is it has to be set forth specifically.

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References to another case are not good enough, unless the actual argument is made, and that it doesn't matter

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what the agency knew or didn't know, whether it knew that this was an issue or not?

[00:13:12] Speaker 06:
Again, we would suggest that there would be, where you have already clearly urged the objections on the Commission, there's no dispute that the Commission knew of those objections, and the objections were annexed to the original objection, and you have a pending petition for review

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Also, the other issue here is this court has also been clear that one cannot ask the agency to reconsider agency action while there is a pending district court or pending judicial review action.

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And so given those, that was another reason in our thinking that

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We need to at least let the commission know in our application for rehearing that we are challenging the biological opinion.

[00:14:09] Speaker 06:
We reference the challenge that we had made and annexed it to it.

[00:14:14] Speaker 06:
I'm going to let you go on this.

[00:14:18] Speaker 04:
You better go on, too.

[00:14:19] Speaker 06:
Oh, the one other point.

[00:14:23] Speaker 06:
About two months ago, this court decided on July 6, 2018, American Rivers, Alabama Rivers Alliance,

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The holdings in that case on the merits are holdings into which this case fits neatly because the error that the service undertook in the biological opinion is quite similar.

[00:14:48] Speaker 06:
Yes, Alabama power was a relicensing, a full relicensing decision.

[00:14:53] Speaker 06:
This was a modification to the license, but the license is still to operate.

[00:14:58] Speaker 04:
Can I just ask for future, if you come across a case that you, we have a procedure called 28J to provide the court in advance, and of course the other side, that's what this would be, right?

[00:15:14] Speaker 06:
Yes, that's what this would be.

[00:15:15] Speaker 06:
It was a case decided after the final briefs were submitted.

[00:15:20] Speaker 04:
Okay.

[00:15:20] Speaker 04:
River, questions from within?

[00:15:22] Speaker 06:
Thank you.

[00:15:37] Speaker 01:
Good morning.

[00:15:38] Speaker 01:
May it please the court Elizabeth Rylander for the commission.

[00:15:42] Speaker 01:
The court seems to well understand the commission's jurisdictional argument here, which is that the only two issues raised for consideration were improper deference and whether the interim plan conflicts with the Kennebec agreement.

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The remaining substantive issues that the petitioner here brings up were not properly preserved in the request for rehearing.

[00:16:03] Speaker 01:
And as Your Honors have mentioned previously, this Court's prior case in Indiana prevents the petitioners from incorporating a document by reference and relying on it in a request for a hearing, and also indicates that it doesn't make a difference if the Commission knew or should have known what the petitioner's arguments were.

[00:16:24] Speaker 01:
In this case, the petitioners had indeed raised some of the arguments they cite in their earlier protests and filings to the Commission, but they didn't properly preserve them in the request for rehearing.

[00:16:34] Speaker 01:
Federal Power Act Section 313 therefore bars the jurisdiction here.

[00:16:42] Speaker 01:
And as previously referenced, the Commission actually dismissed this request for rehearing anyway for want of form.

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If the Court has further questions, I'm happy to take them.

[00:16:55] Speaker 01:
Yes, because the request for re-hearing did not comply with the Commission's rule at 18 CFR Section 385.713C, which requires specification of issues.

[00:17:09] Speaker 04:
Not when I know, but go ahead and say it again.

[00:17:11] Speaker 01:
Okay.

[00:17:12] Speaker 01:
I'm sorry, Your Honor.

[00:17:14] Speaker 01:
The Commission's rules at 18 CFR

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Section 385.713 require the specification of issues under a separate heading and a request for re-hearing.

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The commission actually dismissed the request for re-hearing for not following this rule.

[00:17:32] Speaker 04:
And indeed... I have an order dismissing re-hearing where they actually discuss... Yes.

[00:17:38] Speaker 04:
...the merits of the two points you mentioned.

[00:17:42] Speaker 01:
Yes, Your Honor.

[00:17:43] Speaker 01:
The commission did go on to discuss the merits anyway.

[00:17:50] Speaker 04:
Any questions from the bench?

[00:17:52] Speaker 04:
More from you?

[00:17:54] Speaker 04:
Not required.

[00:17:55] Speaker 04:
I'm just asking.

[00:17:56] Speaker 04:
We're always happy to take the time back.

[00:18:01] Speaker 04:
No, it's not necessary.

[00:18:02] Speaker 04:
I didn't mean to.

[00:18:04] Speaker 04:
All right.

[00:18:04] Speaker 04:
We'll let you sit down.

[00:18:05] Speaker 04:
There are no more questions.

[00:18:06] Speaker 01:
Thank you, Your Honor.

[00:18:06] Speaker 01:
We'll rest on our briefs.

[00:18:09] Speaker 03:
Just so I'm clear, if the reasons for rehearing in part five

[00:18:18] Speaker 03:
had added one sentence that said the Commission should address the objections to be raised in the District Court of Maine.

[00:18:39] Speaker 01:
Would that have been enough?

[00:18:40] Speaker 01:
I presume, Your Honor, that you're asking about whether the request for rehearing had stated something like that.

[00:18:47] Speaker 01:
No, Your Honor, I would say it would not have been enough that both Federal Power Act Section 313 and the Commission's own rules require that the issues be specified.

[00:18:58] Speaker 03:
So therefore, it should have cut and pasted its district court memorandum?

[00:19:09] Speaker 01:
That might have been sufficient, Your Honor, yes.

[00:19:11] Speaker 03:
Might have been?

[00:19:13] Speaker 01:
Well, the Commission didn't have the opportunity to pass upon that.

[00:19:16] Speaker 03:
I'm trying to understand how we're reading this rule, much less the statute.

[00:19:22] Speaker 01:
The commission's procedural rule, Your Honor?

[00:19:24] Speaker 03:
In other words, this is a little different, where you have this ongoing litigation.

[00:19:33] Speaker 03:
I just want to know what specifically is this?

[00:19:40] Speaker 01:
I would say, Your Honor, that it's not different that there is this ongoing litigation.

[00:19:44] Speaker 01:
And again, that refers back to this court's case in Indiana.

[00:19:49] Speaker 03:
The Commission... So the Commission would want... That sentence that I referred to would not be enough?

[00:19:58] Speaker 01:
No, Your Honor, I would say it's not enough.

[00:20:00] Speaker 01:
The Commission's rules require that the issues be specified under a separate heading.

[00:20:05] Speaker 03:
No, I specified them because I said, here they are.

[00:20:11] Speaker 01:
So had they, Your Honor... No, Your Honor, no incorporation by reference.

[00:20:18] Speaker 01:
That would require that the Commission look to the underlying document, which in this case was a protest.

[00:20:23] Speaker 01:
I would say no, Your Honor.

[00:20:27] Speaker 03:
In this case...

[00:20:35] Speaker 04:
Okay, thank you.

[00:20:35] Speaker 04:
Thank you, Your Honor.

[00:20:37] Speaker 04:
Is there time left?

[00:20:38] Speaker 04:
Oh, there's another party.

[00:20:40] Speaker 04:
Sorry.

[00:20:41] Speaker 04:
Apologize.

[00:20:46] Speaker 04:
This is the Department of Commerce, is that right?

[00:20:50] Speaker 02:
Good morning.

[00:20:50] Speaker 02:
It's Kevin McArdle for the Department of Commerce, National Marine Fisheries Service, and may it please the Court.

[00:20:55] Speaker 02:
The Fisheries Service has intervened in this action to defend the merits of its biological opinion.

[00:21:01] Speaker 02:
The discussion thus far is focused exclusively on the jurisdictional issues raised by FERC.

[00:21:06] Speaker 02:
Are there any specific components of the biological opinion that the Court would like me to address?

[00:21:17] Speaker 02:
Apparently not.

[00:21:18] Speaker 02:
Thank you.

[00:21:18] Speaker 02:
Okay, then we'll rest on our brief.

[00:21:20] Speaker 02:
Thank you.

[00:21:24] Speaker 04:
Time remaining?

[00:21:26] Speaker 04:
Thirty seconds.

[00:21:26] Speaker 04:
I'll give you two minutes.

[00:21:28] Speaker 04:
How's that?

[00:21:28] Speaker 04:
Thank you.

[00:21:29] Speaker 04:
The other side has been kind enough.

[00:21:30] Speaker 06:
Thank you, Your Honor.

[00:21:33] Speaker 06:
Again, I go to the reasonable grounds clause in the statute.

[00:21:42] Speaker 06:
This is important.

[00:21:43] Speaker 06:
The biological opinion was issued in July of 2013 and submitted on the commission record.

[00:21:51] Speaker 06:
The main environmental groups and others specifically filed all of these challenges in July of 2014 on the commission record before the order was issued.

[00:22:07] Speaker 06:
explaining these are the fatal flaws in the biological opinion.

[00:22:15] Speaker 06:
Nothing happened for a year on the Commission's record.

[00:22:23] Speaker 06:
We needed to challenge these no jeopardy findings.

[00:22:26] Speaker 06:
So it was then by July of 2015, which on the authority again of Dow Agro-Sciences suggested that there may be a right under these circumstances because we're challenging the final agency action of the service

[00:22:44] Speaker 06:
to commence a direct petition in the district court.

[00:22:50] Speaker 06:
Two months later, in September of 2015, was when we filed our objections again on the commission record to any incorporation of this biological opinion in order to modify licenses, and that's where we annexed our judicial review petition

[00:23:14] Speaker 06:
the Commission's response to that was not to respond.

[00:23:20] Speaker 06:
As a matter of, it is a matter of form.

[00:23:23] Speaker 06:
If we had refiled again in our application for re-hearing, annexed the same set of arguments, put a statement of issues heading on it, realistically, the Commission would have done nothing.

[00:23:37] Speaker 06:
The Commission would not have the purpose

[00:23:39] Speaker 03:
of urging the objections on the Commission so that the Commission can change its own errors.

[00:23:56] Speaker 06:
Yes, yes, but the theory behind it is that if the Commission can correct its own errors, you may obviate the need for a judicial review, or if it refuses to correct its own errors, it may assist the judicial review.

[00:24:14] Speaker 03:
I'm not trying to argue the equities and merits, but I'm just saying interpreting the statute very strictly as has this court, although I must say the Supreme Court has not always been quite as strict.

[00:24:36] Speaker 06:
Correct.

[00:24:37] Speaker 06:
Again, the reasonable grounds for failure to do so provision, I think, just as a matter of statutory interpretation, will counsel against and restrict.

[00:24:51] Speaker 05:
I hear you, but how do you reconcile that with the language Chief Judge Garland read?

[00:24:56] Speaker 05:
from the Indiana regulatory case.

[00:24:59] Speaker 05:
I mean, because when you and I spoke before, I said, so what were the reasonable grounds?

[00:25:04] Speaker 05:
And one of them was that because of the Maine litigation, the commission knew.

[00:25:10] Speaker 05:
They knew.

[00:25:11] Speaker 05:
The language from the case of Chief Judge Garland seemed to address that.

[00:25:16] Speaker 06:
Well, but it doesn't address a situation where the Commission would not have had the regulatory power to correct its own error.

[00:25:27] Speaker 06:
And that issue, as under the reasonable grounds exception, has not come up.

[00:25:35] Speaker 06:
SAV-R-Sebastakuk makes it clear that the point of that reasonable grounds provision is to make sure that if the Commission is alerted to the objection,

[00:25:45] Speaker 06:
and has a chance to correct its own errors.

[00:25:49] Speaker 06:
Your point is they couldn't have done anything there, is that correct?

[00:25:52] Speaker 04:
Correct.

[00:25:52] Speaker 04:
So I'm reading Sebastical now, and it specifically rejects the argument of futility.

[00:25:59] Speaker 04:
That is, it rejects the argument that just because you know the agency is going to continue to rule it the way it's done, you still have to do it, right?

[00:26:09] Speaker 04:
You still have to present it in the petition for reconsideration.

[00:26:13] Speaker 06:
But I think, correct me if I may, Save Our Sebastian I thought had also set up an extraordinary circumstances type analysis.

[00:26:25] Speaker 04:
Yes, no, that's quite correct.

[00:26:26] Speaker 04:
And there's two, they give only two examples.

[00:26:31] Speaker 04:
One is where the agency acknowledges that its action was unlawful, which we don't have any confession of error here.

[00:26:39] Speaker 04:
And secondly, where the petitioner had twice presented his objections and intervening, there was a decision by this court that found the commission's action was illegal, which we don't have here.

[00:26:51] Speaker 06:
Correct.

[00:26:51] Speaker 06:
We are urging a third, when the commission would not have the regulatory power to correct the errors.

[00:27:00] Speaker 05:
That's Wisconsin Power and Light, right?

[00:27:02] Speaker 05:
Is that the Wisconsin Power and Light case?

[00:27:04] Speaker 06:
Well, the biological opinion is the final agency action of the service as the consulting agency.

[00:27:12] Speaker 05:
I'm sorry, I was referring to your earlier point about if the commission had no power to change the BIOC.

[00:27:22] Speaker 05:
than the reasoning of Wisconsin Power and Light.

[00:27:25] Speaker 05:
Right.

[00:27:25] Speaker 06:
That would be reasonable grounds under Section 825 LB, especially when those challenges have been submitted to the Commission.

[00:27:34] Speaker 04:
But it's clear that, from our own opinions, that the Commission is not required to follow the BIOP.

[00:27:41] Speaker 04:
So if the Commission thinks the BIOP is nutty, then it wouldn't defer.

[00:27:46] Speaker 04:
If the Commission thinks the BIOP is wrong,

[00:27:49] Speaker 04:
doesn't have to defer.

[00:27:51] Speaker 04:
This isn't an automatic because there's a buy-up that must do what the other agency says, right?

[00:27:57] Speaker 04:
That's true.

[00:27:58] Speaker 06:
That's true.

[00:28:01] Speaker 06:
That's true.

[00:28:03] Speaker 06:
If the biop has a jeopardy finding, Bennett versus Speer, the Commission acts at its peril to ignore that jeopardy finding.

[00:28:10] Speaker 04:
Peril means somebody on the other side comes up here and argues instead of you from the other side.

[00:28:15] Speaker 04:
Correct.

[00:28:15] Speaker 06:
This was a no jeopardy finding.

[00:28:17] Speaker 06:
So yes, the Commission could have

[00:28:24] Speaker 06:
But again, the Commission had said we're not going to undermine the authority of the consulting agency.

[00:28:30] Speaker 05:
And didn't the government weigh in on this jurisdictional issue that we're wrestling with right now in the First Circuit?

[00:28:39] Speaker 05:
Am I remembering that correctly?

[00:28:41] Speaker 06:
Yes, the jurisdictional issue in the First Circuit was the service had provided an assurance, in essence, to the First Circuit that we would not be

[00:28:54] Speaker 06:
The courthouse doors would not be slammed on us.