Opinion
CIVIL ACTION NO. 93-0112-BH-S.
December 15, 1993
FINDINGS OF FACT; CONCLUSIONS OF LAW AND ORDER
This action is before the Court on the United States' motion to reconsider and/or for summary judgment in favor of the Government (Tab # 15). Plaintiff, the United States of America, filed this action against William B. Thompson and Thompson Trawlers, Inc. to collect civil penalties administratively assessed against these defendants by the Secretary of Commerce. The penalties are for violation of the Endangered Species Act of 1973, 16 U.S.C. §§ 1531 et seq. (ESA) and applicable provisions of 50 C.F.R. parts 217, 222 and 227 for the knowing and unlawful failure to use a qualified turtle excluder device (TED) in each net during trawling on a vessel twenty-five (25) feet or longer in length in the Gulf of Mexico area offshore. Penalties are sought in this litigation in the amount of $8,000.00 plus interest accruing at a rate of nine (9) percent per annum, process and handling charges as provided by the Debt Collection Act of 1982 at 31 U.S.C. § 3717 in the amount of six (6) percent per annum, and a surcharge of ten (10) percent of the debt as provided by 28 U.S.C. § 3011.
Upon consideration of the United States' motion, defendants response in opposition thereto, the United States' reply and the record as a whole, the Court concludes that there exists no material issue of fact and that the United States' motion for summary judgment is due to be granted.
I. FINDINGS OF FACT
After consideration of plaintiff's motion for summary judgment and based on the pleadings, affidavits and other evidence of record, the Court makes the following findings of fact:
1. On April 2, 1990, the defendants, William B. Thompson as operator and Thompson Trawlers, Inc. as owner of the F/V BAMA Love (U.S. documentation number 919310) knowingly failed to use a qualified turtle excluder device (TED) in each net during trawling on a vessel twenty-five (25) feet or longer in length in the Gulf of Mexico area offshore in violation of the Endangered Species Act of 1973, 16 U.S.C. §§ 1531 et seq.
2. On April 12, 1990, the Secretary of Commerce, acting through the office of General Counsel, National Oceanic and Atmospheric Administration, issued a Notice of Violation and Assessment (NOVA) to defendants William B. Thompson and Thompson Trawlers, Inc., jointly and severally. The NOVA assessed a civil penalty in the amount of $8,000.00.
3. On April 16, 1990, defendants received the NOVA by certified mail. The NOVA stated clearly as follows:
NOTICE: This is not a criminal action. You, your attorney, or other representative has 30 days following receipt of this Notice to respond. During this time you may: (1) admit the charged violation by signing the AGREED DISPOSITION below and sending payment of the specified amount, by check or money order payable to the "Treasurer of the United States," to the office indicated below; (2) seek to have this Notice modified to conform to the facts or the law as you see them by contacting the Attorney listed below; (3) request a hearing (like a trial) before an Administrative Law Judge to deny or contest all, or any part, of the violation(s) charged and the civil penalty assessed. Such request must be dated and in writing, and must be delivered to the address set forth below. For good cause shown, you may, within the 30-day period specified above, request an extension of time to respond.
WARNING: IF YOU FAIL TO EXERCISE YOUR RIGHTS AS SET FORTH ABOVE WITHIN 30 DAYS FOLLOWING RECEIPT OF THIS NOTICE, ALL OF THE ALLEGATIONS AND THE PENALTY HEREIN WILL BE TAKEN AS ADMITTED AND THIS ASSESSMENT WILL BECOME A FINAL ADMINISTRATIVE ORDER ENFORCEABLE IN ANY UNITED STATES DISTRICT COURT as provided in Section 11(a) of the Endangered Species Act of 1973, as amended ( 16 U.S.C. 1540(a)(1)), and regulations in 15 C.F.R. Part 904 (copy attached for your information and guidance. THE ENCLOSED REGULATIONS GOVERN THESE CIVIL PROCEDURES AND EXPLAIN YOUR RIGHTS. READ THEM CAREFULLY.
(Government Exhibit 1 to the Complaint (emphasis added)).
4. Although defendant William B. Thompson contends that he requested a hearing, he does not dispute the fact that he did not make such a request in writing and deliver same as directed in the NOVA and federal regulations. (W. B. Thompson Affidavit). With respect to the violation itself, William B. Thompson testified:
All the teds were broken, so I removed what was left that night. The next morning . . . [b]efore the 2nd or 3rd tow was up the Coast Guard boarded us and cited us for violating the endangered species act for not having teds in our nets.
(Id.). With respect to his conversations with Karen Raine, the attorney-advisor who issued the NOVA to the defendants for the Secretary of Commerce, William B. Thompson also testified:
I talked to Ms. Raine on several occasions and the conversation got the [sic] my ability to pay. At that time, I was in a serious financial condition as one of my sons suffered a severe injury, coupled with a bad shrimp season. Ms. Raine told me to send financial information and sent the forms to my accountant, [name omitted] who promptly returned the forms. . . . During my many conversations with Ms. Raine, I told her that unless we could reach an agreement in this matter, I would just have to go to court.
(Id.).
5. The defendants, William B. Thompson and Thompson Trawlers, Inc., have failed to pay the penalties which became a final agency determination on May 16, 1990. Defendants are indebted to the United States in the amount of $8,000.00, plus interest at the rate of 9% per annum from May 16, 1990, until the date of judgment, plus process and handling charges in the amount of 6% from May 16, 1990, until the date of judgment, plus a surcharge of 10% pursuant to 28 U.S.C. § 3011.
II. CONCLUSIONS OF LAW
1. The authority to enforce the ESA and assess penalties for violations committed thereunder is vested in the Secretaries of Commerce and the Interior. 16 U.S.C. §§ 1532(15) and 1540(a). The Secretary of Commerce, acting through the Office of General Counsel, the National Oceanic and Atmospheric Administration (NOAA), has issued regulations which set forth procedures governing administrative proceedings for the assessment of civil penalties under the ESA with regard to those species within the jurisdiction of the Secretary of Commerce. See 15 C.F.R. 904.100et seq. These regulations provide that for any civil penalty assessed under the ESA, those charged have the opportunity to contest the factual allegations which form the basis for the penalty before an Administrative Law Judge (ALJ).
2. The agency's assessment of a civil penalty under the ESA commences with the issuance of a NOVA. 15 C.F.R. § 904.101. A NOVA, as the name implies, provides the person charged with notice of the violation alleged as well as the penalty assessed by the agency. It is served personally or by registered or certified mail upon a person alleged to be subject to a civil penalty under the ESA. 15 C.F.R. § 904.101(a). The NOVA contains a statement of the facts which constitute the violation, a specific reference to the statutory or regulatory provisions allegedly violated, the respondent's rights upon receipt of the NOVA, and the amount of civil penalty assessed. Id. The NOVA is accompanied by a copy of the NOAA civil procedure regulations.Id.
3. With respect to respondent's rights upon receipt of the NOVA, the NOVA specifically explains that the respondent has thirty days from the date of receipt in which to respond either by accepting the penalty, seeking to have it amended, requesting a hearing, or requesting an extension of time to respond. 15 C.F.R. § 904.102(a). The NOVA emphasizes that a request for a hearing must be dated and in writing and delivered to the address specified in the NOVA. 15 C.F.R. § 904.102(e). The NOVA further explains that, if the respondent fails to exercise these rights within the thirty days, all of the allegations and the penalty therein will be taken as admitted. If the respondent takes no action to request a hearing within the thirty day period, or within such extension of time that is granted upon timely request by the respondent, the NOVA becomes effective as the final administrative decision and order of NOAA. 15 C.F.R § 904.102(a)(5) and § 904.104.
4. The NOVA issued to the defendants in this action complied with the aforementioned regulations. Despite the specific notice and warnings set forth in the NOVA, defendants did not timely, in writing, request a hearing. The assessment of the civil penalty against the defendants therefore became a final agency action not subject to further review. 15 C.F.R. § 904.102(a)(5) and § 904.104(a).
Had the defendants requested a hearing in writing, their case would have been assigned to an ALJ who has the authority to preside over the parties and the proceeding, to require a party or witness to state his position concerning any issue at any time during the proceeding, to rule on motions and discovery requests, to administer oaths, and to conduct the hearing and issue a decision based upon the record in the case or to dismiss a case for failure to prosecute or defend. See, 15 C.F.R. § 904.204 and § 904.212. The defendants, conversely, could have sought discovery, including depositions, from the agency and would have had the right to present oral or documentary evidence at the hearing, to submit rebuttal evidence and to cross-examine witnesses proffered by the agency. Id. at § 904.240, § 904.241 and § 904.251. The written decision of the ALJ would have set forth findings and conclusions on all issues of material fact and law. Id. at § 904.271. The defendants would also have had a right to petition the ALJ for reconsideration and the Administrator of NOAA for review of the ALJ's decision. Id. at § 904.272 and § 904.273(a). At each step of the proceedings, if the defendants had not contested the violations alleged or appealed a decision or order issued within the agency, the regulations provide that the assessment becomes the final agency action which is not subject to further review before the agency but which is subject to collection proceedings or judicial review under the Administrative Procedures Act, 5 U.S.C. § 706 (APA) in a federal district court. Id. at § 904.102(a)(5), § 904.271(d) and § 904.273(g) and (i).
5. This Court's review of the actions taken by the United States is limited to the administrative record. The civil penalty provision of the ESA relating to collection actions provides, in pertinent part:
Upon any failure to pay a penalty assessed under this subsection, the Secretary may request the Attorney General to institute a civil action in a district court of the United States for any district in which such person [who violates the ESA] is found, resides or transacts business to collect the penalty and such court shall have jurisdiction to hear and decide any such action. The court shall hear such action on the record made before the Secretary and shall sustain his action if it is supported by substantial evidence on the record considered as a whole.16 U.S.C. § 1540(a)(1) (emphasis added). Thus, the ESA expressly provides the standard of review to be utilized by this Court's in this penalty collection action which limits this Court's authority to the function of determining whether, on the basis of the administrative record as it existed before the agency, substantial evidence supports the agency's assessment.
6. This Court cannot review the agency's findings de novo. See e.g., Washington v. Office of the Comptroller of the Currency, 856 F.2d 1507, 1511 (11th Cir. 1988) ("[T]he only matter for consideration by the trial court in this case was the administrative record."); Pollgreen v. Morris, 770, F.2d 1536, 1544-45 (11th Cir. 1988) (The appellate and district court's review "is limited to the record compiled before the agency.");Fonseca-Leite v. I.N.S., 961 F.2d 60, 62 (5th Cir. 1992) ("[W]e review final [agency] orders . . . examining factual findings . . . solely to see if [they] are supported by substantial evidence."); National Grain and Feed Ass'n v. OSHA, 866 F.2d 717, 728 (5th Cir. 1989) (The court's review of factual findings "is not de novo.").
7. Even if the ESA had not specifically articulated the standard of review for the penalties assessed under the ESA, basic principles of administrative law would prevent this Court from performing a trial de novo. In cases where Congress has simply provided for review, without setting forth the standards to be used or the procedures to be followed, the Supreme Court has held that consideration of agency action is to be confined to the administrative record and no de novo proceedings may be held.United States v. Carlo Bianchi Co., 373 U.S. 709, 715, 83 S.Ct. 1409, 1413, 10 L.Ed.2d 652 (1963), citing, Tagg Bros. Moorehead v. United States, 280 U.S. 420, 50 S.Ct. 220, 74 L.Ed. 524 (1930). Finally, even under statutes which specify a de novo standard, courts have interpreted such to mean a de novo review of the administrative record and decided the case on summary judgment. See e.g., Perri v. Department of Treasury, Bureau of A.T. F., 637 F.2d 1332 (9th Cir. 1981). If a contrary principle were adopted, those who did nothing at the administrative level would receive a more liberal scope of review than those who did request a hearing and contest the penalty at the administrative level. Such would also run contrary to the basic principle of administrative law that, where Congress has allocated to the agency the duty to make these determinations in the first instance, the court should not intervene. Baltimore Gas Electric v. National Resources Defense Council, Inc., 462 U.S. 87, 100-103, 103 S.Ct. 2246, 2254-55, 76 L.Ed.2d 437 (1983).
8. The agency action in this case must be sustained because it is supported by substantial evidence on the record considered as a whole. The administrative record which was filed in this action contains, inter alia, the NOVA (which contains findings and conclusions and states a violation of the ESA and its regulations) and evidence of defendants' failure to request a hearing in the manner required by the NOVA and the federal regulations. Moreover, the NOVA was based upon documentation of first hand observations by law enforcement personnel that defendants were trawling without qualified TEDS at the time and place when they were required by the regulations. William B. Thompson, himself, testified that defendants were trawling without TEDS at the time the Coast Guard boarded his vessel.
9. Here, the defendants were on notice that they had the right to, and had the opportunity to appropriately request in writing, a hearing to defend against the charge of violation and penalty in the NOVA. The defendants were also on notice not only as to the specific violation of the ESA with which they were charged but as to the ESA regulations and the fact that, by failing to request a hearing in writing, the allegations and penalty in the NOVA would be taken as admitted and the NOVA would thereafter become effective as the final administrative decision and order of NOAA. Despite the notice and warning conspicuously presented in the NOVA, defendants did not comply with the procedures by which they could request a hearing and challenge the violation or the assessed penalty. Consequently, there is a basis in the record to support only one conclusion, to-wit: that the penalty as assessed in the NOVA for the stated violation is due and owing.
CONCLUSION AND ORDER
For the reasons stated above, the Court concludes that there exists no material issue of fact and that the United States is entitled to judgment as a matter of law. It is therefore ORDERED that the United States' motion for summary judgment be and is hereby GRANTED and that judgment be entered in favor of the plaintiff, the United States of America, and against the defendants, William B. Thompson and Thompson Trawlers, Inc., jointly and severally, in the amount of $8,000.00, plus interest at the rate of 9% per annum from May 16, 1990, until the date of judgment, plus process and handling charges in the amount of 6% from May 16, 1990, until the date of judgment, plus a surcharge of 10% pursuant to 28 U.S.C. § 3011, said judgment to bear interest from this date at the legal rate of 3.57%. Costs are taxed against the defendants.
JUDGMENT
Pursuant to the Findings of Fact; Conclusions of Law and Order entered this date, granting the United States' motion for summary judgment, it is ORDERED, ADJUDGED and DECREED that JUDGMENT be and is hereby entered in favor of the plaintiff, the United States of America, and against the defendants, William B. Thompson and Thompson Trawlers, Inc., jointly and severally, in the amount of $8,000.00, plus interest at the rate of 9% per annum from May 16, 1990, until the date of judgment, plus process and handling charges in the amount of 6% from May 16, 1990, until the date of judgment, plus a surcharge of 10% pursuant to 28 U.S.C. § 3011, said judgment to bear interest from this date at the legal rate of 3.57%. Costs are taxed against the defendants.