Western Coal Traffic League,petitioners v. Surface Transportation Board and United States of America, Norfolk Southern Corporation, Intervenors

SENTELLE, Circuit Judge,

dissenting:

Congress has delegated to the Surface Transportation Board the authority to “approve and authorize” railroad mergers in 49 U.S.C. § 11324 . In the controversy before us, two major railway corporations, Burlington Northern and Santa Fe Railway Company, and Canadian National Railway Company, notified the Board on December 20, 1999, of their intention to file a merger application in three to six months pursuant to a notification requirement imposed by the Board in 49 C.F.R. § 1180.4 (b). Rather than proceeding to receive the application and process it, the Board issued a Notice of Public Hearing and Request for Comments on the future of the railroad industry, specifically on the role of major railroad consolidations, following which it imposed a moratorium on the filing of merger applications. The Board contends, and the court holds, that the moratorium is within the discretion of the Board under the applicable statutes analyzed in the framework of Chevron U.S.A. Inc. v. Natural Resources Defense Council, 467 U.S. 837 , 104 S.Ct. 2778 , 81 L.Ed.2d 694 (1984). I respectfully dissent.

First, I seriously question whether Chevron provides the appropriate framework for analysis. Under that familiar rubric, as the Court reminds us, we are to proceed in a two-step analysis, asking in step one whether Congress “has directly spoken to the precise question at issue,” id. at 842 , 104 S.Ct. 2778 ; and in step two, whether the agency’s interpretation is “based on a permissible construction of the statute,” id. at 843 , 104 S.Ct. 2778 , in which case we are to defer to it. While we have repeatedly applied Chevron in the context of various forms of agency interpretation, the Supreme Court has more recently cautioned that its application should not be automatic where “an interpretation” is “not óne arrived at after, for example, a formal adjudication or notice- and-comment rulemaking.” Christensen v. Harris County, — U.S. -, -, 120 S.Ct. 1655, 1662 , 146 L.Ed.2d 621 (2000). Although the Board undertook a notice and comment proceeding in the present case, the moratorium imposed1 by the Board does not purport to be the product of that process, but only a hesitation while the Board conducts further notice and comment proceedings. I therefore question the applicability of Chevron. However, I do not contend that we must decide that Chevron is inapplicable, because in my view, even if it is applied, the moratorium is beyond the power of the Board.

At Chevron step one, I will concede that the statute is not free of ambiguity. To that extent, I accept the majority’s statement on its face that “[t]he statute does not address the unanticipated conflict this case presents between the process by which the Board is to review a proposed merger and the purposes for which-the Board is to conduct its review.” Maj. Op. at 1173. In this case that is another way of saying, “the statute is silent as to the Board’s authority to impose a moratorium, and we therefore examine the relevant statutory provisions under step two of Chevron.” However, in accepting that proposition, I do note that as a .general matter, the absence of a statutory grant of power is not an ambiguity or silence on the question of whether Congress has granted *1178 such a power. See, e.g., Adams Fruit Co. v. Barrett, 494 U.S. 638, 649 , 110 S.Ct. 1384 , 108 L.Ed.2d 585 (1990); Backcountry Against Dumps v. EPA 100 F.3d 147, 150-51 (D.C.Cir.1996); Ethyl Corp. v. EPA, 51 F.3d 1053, 1060 (D.C.Cir.1995). As we have noted repeatedly in the past, “to suggest ... that Chevron step two is implicated any time a statute does not expressly negate the existence of a claimed administrative power (ie. when the statute is not written in ‘thou shalt not’ terms), is both flatly unfaithful to the principles of administrative law ... and refuted by precedent.” Railway Labor Executives’ Ass’n v. National Mediation Bd., 29 F.3d 655, 670-71 (D.C.Cir.1994) (en banc); see also Backcountry Against Dumps, 100 F.3d at 151 ; Ethyl Corp., 51 F.3d at 1060 ; Oil, Chem. and Atomic Workers Int'l Union v. NLRB, 46 F.3d 82, 90 (D.C.Cir.1995); American Petroleum Institute v. EPA, 52 F.3d 1113 , 1120 (D.C.Cir.1995). “[W]ere courts to presume a delegation of power absent an express withholding of such power, agencies would enjoy virtually limitless hegemony, a result plainly out of keeping with Chevron and quite likely with the Constitution as well.” Backcountry Against Dumps, 100 F.3d at 151 (internal quotation marks omitted). Therefore, I am concerned that we not be too facile in accepting the proposition that Congress has left an ambiguity as to a power grant simply by not mentioning it. Again, however, I will accept the majority’s assertion of ambiguity, because I think even accepting it does not compel the majority’s result. That is, if we reach step two of Chevron and examine whether the interpretation is a permissible, i.e. reasonable, one, I would hold that it is not.

As I understand the rationale of Chevron, it is that Congress by entrusting an ambiguous statutory provision to the elucidating authority of an agency implicitly delegates to the agency the power to enter authoritative constructions for the purpose of accomplishing the goals of the “statutory scheme it is entrusted to administer.” Chevron, 467 U.S. at 844 , 104 S.Ct. 2778 ; see also Adams Fruit, 494 U.S. at 649 , 110 S.Ct. 1384 (“A precondition to deference under Chevron is a congressional delegation of administrative authority.”). In determining whether an interpretation subjected to Chevron step two analysis is a reasonable exercise of the implicit grant created by the ambiguity, we are to “ex-amin[e] a particular statutory provision” in “ ‘context and with a view to [its] place in the overall statutory scheme.’ ” Food and Drug Admin, v. Brown and Williamson Tobacco Corp., — U.S. -, -, 120 S.Ct. 1291, 1300-01 , 146 L.Ed.2d 121 (2000) (quoting Davis v. Michigan Dep’t of Treasury, 489 U.S. 803, 809 , 109 S.Ct. 1500 , 103 L.Ed.2d 891 (1989)).

The statutory scheme under which the Surface Transportation Board operates is not limited to directing the Board to review mergers with the mandate to consider the public interest, and authorizing the Board to promulgate regulations to accomplish that command. As the majority lays out, Congress also mandated that the Board is to receive filings of merger applications, reject them if incomplete, or give notice of their filing if complete, within thirty days. See 49 U.S.C. § 11325 (a) (Supp. III 1997). The Board then undertakes an evidentiary proceeding, which it must conclude within one year of the publication of the notice. See id. § 11325(b)(3). Lastly, the Board must issue a final decision within ninety days of the conclusion of that proceeding. Id. In other words, Congress included very specific statutory directives concerning the process and time frame for the Board to accomplish its adjudicatory task. The fact that Congress, in enacting these provisions, shortened the statutory review period from 31 to 16 months further supports the conclusion that Congress intended the merger review process to be completed expeditiously within the statutory deadlines. Compare ICC Termination Act of 1995, Pub.L. No. 104-88, § 102 (a), 109 Stat. 803 , 841-42 (codified at 49 U.S.C. § 11325 ), with Railroad Revitalization and Regulatory Reform Act of 1976, Pub.L. No. 94-210, § 402 , 90 Stat. 31 , 62-63.

*1179 In the interpretation before us, rather than determining the application of a theretofore ambiguous provision in such a fashion as to carry out the apparent will of Congress, the Board appears to me to have taken the license granted it under Chevron as an invitation to distort the language of Congress in such a way as to defeat the unambiguous will of that body. Granted, Congress places deadlines only upon the processing of applications once filed. See 49 U.S.C. § 11325 (a), (b). However, Congress also provides for the refusal only of incomplete applications. See id. § 11325(a). It seems to me unreasonable to believe that Congress could have intended to expedite all completed applications by deadlines on handling of such filed applications only to leave the agency with the unbridled discretion to thwart the congressional mandate of expedition by the exercise of a power nowhere expressly granted — to refuse filing in the first instance.

Despite the clarity and specificity with which Congress articulated its wish that the merger review process be completed expeditiously within a given series of deadlines, the majority nevertheless concludes that, in combination, two separate lines of judicial precedent permit the Board to disregard an express congressional mandate. In one series of cases, the Supreme Court and we have recognized agency discretion to delay considering applications where no mandatory statutory deadline scheme such as the one at issue here existed. See, e.g., Permian Basin Area Rate Cases, 390 U.S. 747, 777-81 , 88 S.Ct. 1344 , 20 L.Ed.2d 312 (1968) (involving only an optional five-month suspension of proposed rates, plus the authority to reverse rates retroactively should the agency’s investigation exceed five months); Westinghouse Elec. Corp. v. NRC, 598 F.2d 759 , 771-76 (3d Cir.1979) (noting that the statute in question was “free of close prescription ... as to how [the agency] shall proceed in achieving the statutory objectives”) (quoting Siegel v. Atomic Energy Comm’n, 400 F.2d 778 , 783 (D.C.Cir.1968)); Krueger v. Morton, 539 F.2d 235, 239-40 (D.C.Cir.1976) (containing no mention of statutory or regulatory deadlines of any sort); Pennsylvania v. Lynn, 501 F.2d 848, 854-61 (D.C.Cir.1974) (mentioning no statutory deadline which might contradict the suspension in question, and recognizing instead evidence of congressional acceptance of the moratorium’s legality). Notably, moreover, a number of the cases cited by both the Board and the majority as supporting the application of the same proposition here do not involve challenges to the authority of the agencies in question to freeze applications, but instead ask only whether the agencies followed proper procedure or acted arbitrarily and capriciously. See Neighborhood TV Co. v. FCC, 742 F.2d 629 , 634-40 (D.C.Cir.1984) (raising no statutory authority issue at all, but rather focusing upon whether the agency’s decision to freeze applications violated Administrative Procedure Act requirements); Kessler v. FCC, 326 F.2d 673 , 679-85 (D.C.Cir.1963) (mentioning no statutory or regulatory deadlines, and considering only whether the agency followed proper procedure or was arbitrary and capricious in opposing an applications freeze).

Although it acknowledges that these various cases did not involve specific time-lines for processing applications, see Maj. Op. at 1174, the majority nevertheless points to another group of cases stemming from Telecommunications Research and Action Center v. FCC, 750 F.2d 70 (D.C.Cir.1984) (TRAC), in which we have weighed six factors to determine whether to take the extraordinary step of granting mandamus relief where agencies have failed to satisfy specific statutory deadlines. Granted, as the majority observes, in such cases,, we have previously declined to use our equitable powers to micromanage an agency’s efforts to balance its priorities, even in the face of a clear statutory timetable. See, e.g., In re Barr Laboratories, Inc., 930 F.2d 72, 76 (D.C.Cir.1991) (viewing the agency delay in question as a consequence of the agency’s allocation of its budgetary resources). TRAC and Barr Laboratories did not involve an agency’s express interpretation of its governing statute, however. Unlike those cases, this *1180 present one does not merely involve an agency that has simply failed to act within the statutory time frame. Rather, the Board has issued an order affirmatively asserting that particular statutory provisions implicitly delegate to it the authority to disregard the express commands of other statutory provisions as it sees fit. It is that pronouncement, and not merely the arguably inequitable consequences of the Board’s delay, that we are called upon to consider here. In sum, none of the cited precedents dictates the outcome reached by the court today.

I also find unconvincing the argument of the agency that it could not accept the application because it did not have in place proper rules under which to process the same. For the most part, the Board has had the same rules since 1982. Granted, it has expressed its intent to modify those rules. Whenever that modification is completed, some application will have been the last processed under the old rules, some other the first under the new. I see nothing other than arbitrariness and caprice to justify requiring the present application to fill the role of the latter rather than the former. I respectfully dissent.