Case 3:18-cv-05005-RJB Document 78-2 Filed 05/08/18 Page 1 of 19 THE HONORABLE ROBERT .1. BRYAN 1 9 3 4 5 6 7 8 UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON AT TACOMA 9 10 LIGHTHOUSE RESOURCES INC.; LIGHTHOUSE PRODUCTS, ETC; LHR 11 INFRASTRUCTURE, EEC; LHR COAL, EEC; and MILLENNIUM BULK 12 TERMINALS-LONGVIEW, EEC, 13 14 Plaintiff, No.: 3:18-cv-05005-R.IB AMICUS CURIAE BRIEF IN OPPOSITION TO DEFENDANTS’ MOTION FOR ABSTENTION BY WYOMING, KANSAS, MONTANA, NEBRASKA, SOUTH DAKOTA AND UTAFI V. 15 JAY INSLEE, in his official capacity as Governor of the State of Washington; MAIA 16 BELLON, in her official capacity as Director of the Washington Department of Ecology; 17 and HILARY S. FRANZ, in her official capacity as Commissioner of Public Lands, 18 Defendant. 19 20 NOTED ON TFIE MOTION CALENDAR: MAY 15,2018 TABLE OF CONTENTS 21 TABLE OF AUTFIORITIES 22 INTRODUCTION 4 23 BACKGROUND 5 24 I. The Millennium Bulk Terminal Coal Export Facility. 5 25 IT The Defendants’ Opposition to the Millennium Bulk Terminal Port Facility. 6 26 AMICUS CURIAE BRIEF IN OPPOSITION TO DEFENDANTS’ MOTION FOR ABSTENTION BY WYOMING, KANSAS, MONTANA, NEBRASKA, SOUTH DAKOTA AND UTAH No.: 3:18-CV-05005-RJB Page I BiillivantjlloiisciiBailcy PC 1700 Scvomli Avenue. Suite 1810 Seattle, Washington 9S10M397 Telephone: 206^292.8930 Case 3:18-cv-05005-RJB Document 78-2 Filed 05/08/18 Page 2 of 19 III. Defendants’ Motion for Abstention of the Commerce Clause Claims. 1 2 3 4 7 STANDARD OF REVIEW 7 ARGUMENT 8 I. The Commerce Clause claims are a matter of overwhelming federal interest making abstention inappropriate. 5 6 7 II. Abstention is not proper under the Pullman doctrine. 10 8 III. Abstention is not proper under the Colorado River doctrine. 8 12 17 9 CONCLUSION 10 CERTIFICATE OF SERVICE TABLE OF AUTHORITIES 11 12 Cases Ashcroft V. Iqbal, 13 556 U.S. 662 (2009)..................................................................... 6 14 Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007)............................................................. 15 Bethlehem Contracting Co. v. Lehrer/McGovern, Inc., 800 F.2d 325 (2d Cir. 1986).................................................. 16 Canton v. Spokane Sch. Dist. No. 81, 498 F.2d 840 (9th Cir. 1974)................................................. 17 Cingular Wireless, LLC v. Thurston Cty., 18 150 F. App’x 633 (9th Cir. 2005)...'...................................... 6 18 10 12 19 Colo. River Water Conservation Dist. v. United States, 424 U.S. 800, 817 (1976)...................................................... 20 Courthouse News Serv. v. Planet, 750 F.3d776 (9th Cir. 2014)................................................. 21 Daniels Sharpsmart, Inc. v. Smith, No. l:17-cv-403-LJO-SAB, 2017 U.S. Dist. LEXIS 90840 22 (E.D. Cal. .lune 13,2017)...................................................... 23 Hancock v. City ofRidgefield, No. C09-5580BFIS, 2009 U.S. Dist. LEXIS 117948 (W.D. Wash. 2009)........... 24 Harper v. Pub. Serv. Comm ’n, 396 F.3d 348 (4th Cir. 2005)................................................ 25 Lazv YRanch LTD v. Behrens, 26 '546 F.3d580 (9th Cir. 2008)................................................ AMICUS CURIAE BRIEF IN OPPOSITION TO DEFENDANTS’ MOTION FOR ABSTENTION BY WYOMING, KANSAS, MONTANA, NEBRASKA, SOUTH DAKOTA AND UTAH No.: 3:I8-cv-05005-RJB 5, 13-15 6, 10 8, 10, 14, 17 12 7,8 6 Page 2 l{ulliviint Itouseiil5ailey PC 1700 Sevcnlli Avenue, Suite 1810 Seatllc, Wasliinglon 98101-1.397 Telephone: 206.292.8930 Case 3:18-cv-05005-RJB Document 78-2 Filed 05/08/18 Page 3 of 19 1 Life Partners, Inc. v. Morrison, 484 F.3d 284 (4tli Cir. 2007)............................................................... 2 McClellan v. Carland, 217 U.S. 268 (1910)............................................................................. 3 Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1 (1983)................................................................................. Nat 1. Ass’n for the Advancement of Multiiurisdiction Practice v. Perch, 5 773 F.3d l037 (9thCir. 2014)'............................................................. 6 Porter v. Jones, 3l9F.3d 483 (9th Cir. 2003)................................................................ 7 Procunier v. Martinez, 416 U.S. 396 (1974)............................................................................. 8 Pue V. Sillas, 632 F.2d 74 (9th Cir. 1980).................................................................. 9 10 13 17, 20 7 10-12 7 17 R.R. Comm'n of Tex. v. Pullman Co., 312 U.S. 496 (1941)............................................................................ 11 R.R. St. & Co. V. Transp. Ins. Co., 656 F.3d 966 (9th Cir. 2011)................................................................ 12 Thornburgh v. Abbott, 490 U.S. 401 (1989)............................................................................. 13 Travelers Indein. Co. v. Madonna, 914F.2d 1364 (9th Cir. 1990).............................................................. 14 15 8 United States v. Morros, 268 F.3d 695 (9th Cir. 2001)................................................................ 16 Wisconsin v. Constantineau, 400 U.S. 433 (1971)............................................................................ 17 Zwickler v. Koota, 389 U.S. 241 (1967)............................................................................. 18 Statutes 19 42U.S.C. § 1983 ......................................................................................... 5 passim 7 17, 18 7, 14-16 12 10 4,17 7 20 U.S. Const, art. IV, § 8............................................................................... 21 Other Authorities 22 Fed. R. Civ. P. 12..................................................................................... Leonard Birdsong, Comity and Our Federalism in the Twenty-First 23 Century: The Abstention Doctrines Will Always Be With Us ~ Get Over Itl, 36 Creighton L. Rev. 375 (2003)...................................... 24 5, 6 10 2 The Federalist No. 22 (Alexander Hamilton)....................................... 25 26 AMICUS CURIAE BRIEF IN OPPOSITION TO DEFENDANTS’ MOTION FOR ABSTENTION BY WYOMING, KANSAS, MONTANA, NEBRASKA, SOUTH DAKOTA AND UTAH No.: 3:18-cv-05005-R.IB Page 3 BullivaiitlMoiisciiBailey PC 1700 Seventli Avenue, Suite 1810 Seattle, Washington 98101-1397 Telephone; 206.292.8930 Case 3:18-cv-05005-RJB Document 78-2 Filed 05/08/18 Page 4 of 19 INTRODUCTION 2 In 2016, the States of Wyoming and Montana generated tax revenues of just over $800 3 million from coal mining and coal-power generation. {See Aff. to Mot. for Amicus status). 4 These revenues fund essential services to the citizens of the States, including water and 5 highway infrastructure and education. (Id.). Coal is a critical source of income to the fiscal 6 health of these two states and for the provision of basic services necessary for the health and 7 well-being of their citizens. In addition to the specific interests of Wyoming and Montana, the 8 additional amiei states have a broad interest in ensuring that no single state can engage in a 9 pattern of discrimination that results in control over any other state’s ability to engage in a 10 lawful activity involving interstate or foreign commerce. The Defendants’ unconstitutional 11 actions threaten these interests. 12 The Defendants have publicly expressed their personal antipathy to the use of coal as a 13 fuel source. (See, e.g., Compl. at * ^ 80-99). Defendant Governor Inslee is on record as 14 opposing coal exports, particularly to Asia. (Id. at 86). The other named Defendants either 15 share or have adopted Governor Inslee’s anti-coal position. (Id. at ][][ 92-95 (Def Bellon); 9616 97 (Def Franz)). With regard to the Millennium Bulk Terminal Port Facility, the Defendants 17 have engaged in a pattern of discrimination to prevent Wyoming and Montana from engaging 18 in interstate and foreign commerce. In doing so, the Defendants’ have violated the Dormant 19 Foreign and Domestic Commerce Clauses of the United States Constitution. The Defendants 20 are interfering with the free trade of other states, something anathema to the founding 21 principles of our nation. As Alexander Hamilton succinctly put it: 22 23 24 25 The interfering and unneighborly regulations of some States, contrary to the true spirit of the Union, have, in different instances, given just cause of umbrage and complaint to others, and it is to be feared that examples of this nature, if not restrained by a national control, would be multiplied and extended till they became not less serious sources of animosity and discord than injurious impediments to the intercourse between the different parts of the Confederacy. 26 AMICUS CURIAE BRIEF IN OPPOSITION TO DEFENDANTS’ MOTION FOR ABSTENTION BY WYOMING, KANSAS, MONTANA, NEBRASKA, SOUTH DAKOTA AND UTAH No.: 3;I8-cv-05005-RJB Page 4 Biillivant IIousciiBailey PC 1700 Seventh Avenue, Suite 1810 Seattle, Wasliington 98101-1.397 Telephone: 206,292,8930 Case 3:18-cv-05005-RJB Document 78-2 Filed 05/08/18 Page 5 of 19 The FeeleralistTHo. 22 (Alexander Hamilton). The amici States offer this brief to assist the Court in its consideration of Defendants’ 2 3 argument that this Court should abstain Ifom adjudicating the Commerce Clause claims in this 4 suit. This Court should not abstain from considering these claims because abstention is not 5 appropriate in dealing with Commerce Clause claims. Even if it was, the facts in this case do 6 not satisfy the requirements under either the Pullman or Colorado River abstention doctrines. 7 Accordingly, this Court should proceed to adjudicate the Commerce Clause claims. BACKGROUND 8 9 I. 10 The Millennium Bulk Terminal Coal Export Facility. Since 2012, Lighthouse Resources, Inc., a vertically-integrated coal production, 11 transportation, and export company, has sought to develop the Millennium Bulk Terminal Port 12 Facility (Terminal Facility or Project) in Longview, Washington, on the Columbia River. 13 (Compl. at 60-70). Lighthouse desires to transport coal it mines in Montana and Wyoming 14 by rail to the Terminal Facility and then ship it to meet the growing demand for coal in Asia. 15 (Compl. at 35-37; 45-50). The Project requires additional coal export capacity on the West 16 Coast and, accordingly, Lighthouse has applied to obtain the necessary permits from the State 17 of Washington to expand and develop the Terminal Facility to handle the additional coal. 18 (Compl. atin 51; 117; 149; 161; 173; 179). 19 The State of Washington has consistently denied Lighthouse’s permit applications. 20 (Compl. at ^n 149-60; 161-72; 173-78; 179-83). There are currently actions related to these 21 permit denials in state court and the Shorelines Flearing Board involving the denial by the 22 Washington Department of Natural Resources of the transfer of a sublease for the site of the 23 proposed Terminal Facility, the Washington Department of Ecology’s denial of a Clean Water 24 Act Section 401 certification on appeal to the Washington Pollution Control Flearings Board, 25 and Cowlitz County’s denial of a shoreline development and conditional use permit. (See 26 generally Overton Deck Exs. 4, 5, 8, and 10 attached to Def Mot.). AMICUS CURIAE BRIEF IN OPPOSITION TO DEFENDANTS’ MOTION FOR ABSTENTION BY WYOMING, KANSAS, MONTANA, NEBRASKA, SOUTH DAKOTA AND UTAH No.: 3;18-cv-05005-RJB Page 5 Bullivant Housciil}ailey PC 1700 Seventli Avenue, Suite 1810 Seattle, Washington 98101-1397 Telephone: 206!292,89.30 Case 3:18-cv-05005-RJB Document 78-2 Filed 05/08/18 Page 6 of 19 II. 2 The Defendants’ Opposition to the Millennium Bulk Terminal Port Facility. The Defendants have a long-documented public opposition to fossil fuels, and coal in 3 particular. (Conipl. at Yi 80-99; 107-10). Since the Defendants’ accession to their current 4 positions, Washington State agencies have denied every necessary permit for the Terminal 5 Facility. (M. at^l 121-24; 127-36; 149-59; 162-71; 176-78; 180-83). In response. Lighthouse 6 has appealed the permit denials through the Washington state administrative and court systems. 7 Lighthouse initiated this litigation in federal district court not to challenge the outcome of a 8 specific permitting process, but to stop the Defendants’ violation of the Dormant Foreign and 9 Domestic Commerce Clause provisions of the United States Constitution under 42 U.S.C. § 10 1983. (Id. at ^ni 206-10). Specifically, Lighthouse alleges that the Defendants have 11 discriminated against Lighthouse’s project because it involves coal, thus preventing Wyoming 12 and Montana from engaging in foreign and interstate commerce and depriving Lighthouse and 13 its subsidiaries of an economic opportunity and prospective investment. (Id. at Yh 225-39, 24114 48). 15 The Defendants are not parties to any proceeding in a state court or administrative body 16 where there is a Commerce Clause claim at issue. Further, the claim against the Defendants 17 and the relief sought against them is distinct from that in the state-level proceedings. In the 18 state proceedings, the issues are whether the state agencies lawfully denied various permits 19 under various state laws. (Dkt. No. 21-1 at Ex. 4, 5, 8, 10, and 11). If the Facility prevails in 20 the state proceedings, the remedy would be to grant the permit or to remand the matter to the 21 permitting agency for an appropriate consideration of the permit application. By contrast, the 22 claims in this Court rest on alleged violations of federal law and the remedy Lighthouse seeks 23 is fundamentally different than that available in the state proceedings. Specifically, Lighthouse 24 seeks: (1) an order reversing the Defendant’s unconstitutional and Illegal actions; (2) an 25 injunction requiring the Defendants to apply the same standards to Lighthouse’s permit 26 AMICUS CURIAE BRIEF IN OPPOSITION TO DEFENDANTS’ MOTION FOR ABSTENTION BY WYOMING, KANSAS, MONTANA, NEBRASKA, SOUTH DAKOTA AND UTAH No.: 3:I8-cv-05005-RJB Page 6 BiilliviimiHoiiseiilSailey PC 1700 Seventh Avenue. Suite 1810 Seattle. Washington 98101-1.397 Telephone 206'292.8930 Case 3:18-cv-05005-RJB Document 78-2 Filed 05/08/18 Page 7 of 19 applications that are applied to non-coal applications; (3) an injunction ordering that the 2 Defendants not deny Clean Water Act Section 401 certification on a basis unrelated to the 3 requirements of that Act; and (4) an injunction requiring the Defendants to continue to process 4 all future and current permit applications made by Lighthouse. {Id. at Prayer for Relietj F- 5 -T). 6 III. Defendants’ Motion for Abstention of the Commerce Clause Claims. 7 Defendants responded to the Complaint with a “Motion for Parfal Dismissal Under 8 Eleventh Amendment and FRCP 12(b)(6) and Motion for Abstention.” The request for 9 abstention derives ixom two doctrines established by the United States Supreme Court in the 10 cases of Railroad Commission of Texas v. Pidlman Company, 312 U.S. 496 (1941), and 11 Colorado River Water Conservation District v. United States, 424 U.S. 800, 817 (1976), and 12 is directed to Lighthouse’s Commerce Clause claims. (Def. Mot. at 16-24). Because the 13 Defendants do not meet the criteria for abstention, the States respectfully request that this Court 14 deny the Motion for Abstention and adjudicate the Commerce Clause claims. 15 16 STANDARD OF REVIEW Defendants bring their motion for abstention under Federal Rule of Civil Procedure 17 12(b)(6). (Def. Br. at 7). When considering an abstenf on request under Rule 12(b)(6), the court 18 generally accepts as true the allegations in the complaint, construes the pleading in the light 19 most favorable to the party opposing the motion, and resolves all doubts in the pleader’s favor. 20 Lazy YRanch LTD v. Behrens, 546 F.3d 580, 588 (9th Cir. 2008). To survive a Rule 12(b)(6) 21 motion to dismiss, the plaintiff must “allege enough facts to state a claim to relief that is 22 plausible on its face.” Id. {oyxolmg Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “A 23 claim has facial plausibility when the [pjlaintiff pleads factual content that allows the court to 24 draw the reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft 25 V. Iqbal, 556 U.S. 662, 678 (2009). 26 AMICUS CURIAE BRIEF IN OPPOSITION TO DEFENDANTS’ MOTION FOR ABSTENTION BY WYOMING, KANSAS, MONTANA, NEBRASKA, SOUTH DAKOTA AND UTAH No,: 3:18-cv-05005-R.IB Page 7 BiillivantlHouseiilJailey PC 1700 Seventh Avenue, Suite 1810 Seattle. Wasliington 98101-1397 Telephone: 206~292.8930 Case 3:18-cv-05005-RJB Document 78-2 Filed 05/08/18 Page 8 of 19 Further, the Defendants’ motion is a ;c facial” challenge to this Court’s exercise of 2 jurisdiction, not a “factual” one. A factual challenge relies on affidavits or any other evidence iC properly before the court to contest the truth of the complaint’s allegations.” Courthouse News 4 Serv. V. Planet, 750 F.3d 776, 780 (9th Cir. 2014) (internal quotes and brackets omitted). The 5 Defendants filed a Declaration from counsel identifying the concurrent state proceedings that 6 included exhibits of related orders, notices of appeal, and other procedural filings. (Deck of 7 Lee Overton). The Defendants, however, do not contest the truth of any of the allegations in 8 the Complaint. Accordingly, the factual allegations in the Complaint are true for purposes of 9 this Court’s resolution of the Defendants’ motion. ARGUMENT 10 Defendants assert that the parallel, state-level proceedings require this Court to abstain 11 12 from ruling on Lighthouse’s Commerce Clause claims. Initially, the Court should reject the 13 Defendants’ request for abstention because the Commerce Clause claims raise important 14 federal questions that impact the economic interests of other states. Even if the abstention 15 doctrines did apply, the Defendants have failed to establish that under the facts and 16 circumstances of this case that either the Pullman or the Colorado River doctrine supports 17 abstention. 18 I. The Commerce Clause claims are a matter of overwhelming federal interest making abstention inappropriate. 19 20 “The Commerce Clause of the United States Constitution, Article I, Section 8, prohibits 21 states from discriminating against interstate commerce, and bars regulations that, although 22 facially nondiscriminatory, unduly burden interstate commerce. Nat’l Ass’n for the 23 Advancement of Multijurisdiction Practice v. Perch, 773 F.3d 1037, 1048 (9th Cir. 2014). 24 Abstention is not favored when sensitive federal constitutional claims are at stake. See, e.g., 25 Procunier v. Martinez, 416 U.S. 396, 404 (1974), overruled on other grounds by Thornburgh 26 V. Abbott, 490 U.S. 401, 413-14 (1989); Harper v. Pub. Serv. Comm’n, 396 F.3d 348, 355-56 AMICUS CURIAE BRIEF IN OPPOSITION TO DEFENDANTS’ MOTION FOR ABSTENTION BY WYOMING, KANSAS, MONTANA, NEBRASKA, SOUTH DAKOTA AND UTAH No.: 3:I8-cv-05005-RJB Page 8 Biillivant HousciiIiaiIcy PC 1700 Seventh ykveiuie, Suite 1810 Seattle. Washington 98101-1397 Telephone: 206.292,8930 Case 3:18-cv-05005-RJB Document 78-2 Filed 05/08/18 Page 9 of 19 (4th Cir. 2005); United States v. Morros, 268 F.3d 695, 706-07 (9th Cir. 2001). The “commerce 2 clause power itself justifies a narrower view of state interests in the abstention context.” 3 Harper, 396 ¥.3d at 351. 4 5 6 7 8 9 10 11 12 The commerce power plays a role in abstention analysis quite different from many of the other provisions of the Constitution. The dormant Commerce Clause demonstrates a difference of kind, not merely of degree. By its very nature, it implicates interstate interests. It protects all states by ensuring that no state erects the kind of barriers to trade and economic activity that threatened the survived of a fledging country under the Articles of Confederation. Giving the power over commerce to Congress was easily seen as structurally creating an interstate interest ... Our “national common market” does not allow states - even inadvertently - to impede commerce and sow disunity. When there is an overwhelming federal interest an interest that is as much a core attribute of the national government as the list of important state interests are attributes of state sovereignty in or constitutional tradition - no state interest, for abstention purposes, can be nearly as strong at the same timef.] 13 Harper, 396 F.3d at 355-56 (emphasis added; internal ellipses omitted); see also Life Partners, 14 Inc. V. Morrison, 484 F.3d 284, 300-01 (4th Cir. 2007) (determining that the district court did 15 not abuse its discretion in declining to abstain on Commerce Clause claim); Daniels 16 Sharpsmart, Inc. v. Smith, No. l:17-cv-403-LJO-SAB, 2017 U.S. Dist. TEXIS 90840, at *1117 20 (E.D. Cal. .lune 13, 2017) (finding that abstention on a Commerce Clause claim is generally 18 inappropriate under any of the recognized abstention doctrines). 19 The Defendants’ illegal actions have violated the United States Constitution and 20 adversely impacted the economic and fiscal interests of states that seek to export commodities 21 to foreign markets. The Defendants are trying to force on other states their policy preferences 22 regarding the use of coal as a source of fuel, and thus, they are impeding the free flow of 23 commerce. Today it is coal, tomorrow it could be natural gas or non-organic produce. The 24 interests of interior states in developing foreign trade are now subject to the barriers erected 25 by the policy whims of states that control access to international markets through their ports. 26 AMICUS CURIAE BRIEF IN OPPOSITION TO DEFENDANTS’ MOTION FOR ABSTENTION BY WYOMING, KANSAS, MONTANA, NEBRASKA, SOUTH DAKOTA AND UTAH No.: 3:I8-cv-05005-RJB Page 9 l}ullivaiit ll()useiiBailcy I’C 1700 Scventli Avemic. Suite 1810 Seattle, Wasliiiiglon 98101-1397 Teleplionc: 206~292.8930 Case 3:18-cv-05005-RJB Document 78-2 Filed 05/08/18 Page 10 of 19 1 This is clearly a matter of “overwhelming federal interest” that is crucial to the trade and 9 economic activity of this nation, and there is no state interest, for purposes of abstention, that 3 is comparable. Indeed, the Defendants cannot explain how a decision in any of the state 4 proceedings would prevent them from continuing to engage in actions improper under the 5 Commerce Clause. Consequently, this Court should not engage in an assessment of the different factors of 6 7 either the Pullman or the Colorado River doctrines, as abstention on a Commerce Claim is 8 inappropriate under both in these circumstances. Instead, the Court should hear Lighthouse’s 9 claims under the Commerce Clause on the merits. 10 II. Abstention is not proper under the Pullman doctrine. 11 In Pullman, the United States Supreiue Court counseled “abstention by federal courts 12 in order to avoid decisions of federal constitutional questions when the case may be disposed 13 of on questions of state law.” Leonard Birdsong, Comity and Our Federalism in the Twenty14 First Century: The Abstention Doctrines Will Always Be With Us - Get Overltl, 36 Creighton 15 L. Rev. 375, 388 (2003). ‘■‘■Pullman abstention ‘is an extraordinary and narrow exception to the 16 duty of a [d]istrict [c]ourt to adjudicate a controversy’ that is properly before it.” Porter v. 17 Jones, 319 F.3d 483, 492 (9th Cir. 2003) (quoting Canton v. Spokane Sch. Dist. No. 81, 498 18 F.2d 840, 845 (9th Cir. 1974)). A court should give a plaintiff’s choice of a federal forum for 19 hearing and adjudication of their federal constitutional claims “due respect” and "‘■Pullman 20 abstention should rarely be applied.” Porter, 319 F.3d at 492 (citing Zwickler v. Koota, 389 21 U.S. 241,248 (1967)). 22 Pullman abstention is appropriate only if three mandatory criteria are established: “(1) 23 the case touches on a sensitive area of social policy upon which the federal courts ought not 24 enter unless no alternative to its adjudication is open, (2) constitutional adjudication plainly 25 can be avoided if a definite ruling on the state issue would terminate the controversy, and (3) 26 AMICUS CURIAE BRIEF IN OPPOSITION TO DEFENDANTS’ MOTION FOR ABSTENTION BY WYOMING, KANSAS, MONTANA, NEBRASKA, SOUTH DAKOTA AND UTAH No,: 3:18-cv-05005-RJB Page 10 Biillivant]Hou.sei jUailey PC 1700 Seventh Avenue, Suite 1810 Seattle. Washington 98101-1397 Telephone: 206.292.8930 Case 3:18-cv-05005-RJB Document 78-2 Filed 05/08/18 Page 11 of 19 1 the proper resolution of the possible determinative issue of state law is uncertain.” Courthouse 2 News Serv., 750 F.3d at 783-84 (quoting Porter, 319 F.3d at 492)). 3 None of these criteria are satisfied here. This case does not involve “a sensitive area of 4 social policy” which has been defined to include land use planning, landlord-tenant 5 relationships, foreclosure policy, and death penalty procedures.” Daniels, 2017 U.S. Dist. 6 LEXIS 90840, at * 15, n.l 1 (listing cases). The Defendants characterize this as a land use case. 7 (Def Mot. at 17). This is incorrect. This is actually a Commerce Clause claim under the United States Constitution. The premise of this case is that the Defendants used their official positions 9 to interfere with the permitting process. There is no constitutional challenge to the validity of 10 Washington’s rules and laws governing the issuance of permits for projects like the Terminal 11 Facility. The dispute does not touch on Washington’s sovereign authority to regulate its lands, 12 protect its environment, and the health and safety of its citizens. The dispute is that the 13 Washington officials charged with enforcing those laws manipulated or simply ignored them 14 in pursuit of their predetermined, personal agenda to block the export of coal through the State 15 of Washington. Since a Commerce Clause challenge to the propriety of an administrative 16 process is not “a sensitive area of social policy[,]” this alone makes Pullman abstention 17 inappropriate in this case. 18 Moreover, Defendants fail to satisfy the second and third criteria. The second criterion 19 asks whether a “constitutional adjudication plainly can be avoided if a definite ruling on the 20 state issue would terminate the controversy[.]” Porter, 319 F.3d at 492. The Defendants 21 assume that the mere existence of related parallel claims in concurrent state proceedings is a 22 sufficient basis for the federal court to abstain from addressing an important federal 23 constitutional claim. (Def Mot. at 18). In a series of conclusory statements. Defendants 24 maintain that resolution of state law claims relating to the denied permits “would likely moot 25 the constitutional challenges.” {Id). The Commerce Clause claims derive from the Defendants’ 26 improper and extra-constitutional actions to block the transportation of coal across AMICUS CURIAE BRIEF IN OPPOSITION TO DEFENDANTS’ MOTION FOR ABSTENTION BY WYOMING, KANSAS, MONTANA, NEBRASKA, SOUTH DAKOTA AND UTAH No.: 3:18-cv-05005-RJB Page 11 BullivantllloiiseiiBailcy PC 1700 Sevemh Avenue, Suite 1810 Seattle. Wasliington 98101-1397 Telephone; 206.292.8930 Case 3:18-cv-05005-RJB Document 78-2 Filed 05/08/18 Page 12 of 19 Washington’s border for export into foreign commerce. Defendants do not address how 2 resolution of the state law issues would resolve the federal constitutional claim or prevent the 3 Defendants from continuing to advance their anti-coal agenda through impermissible actions 4 in future proceedings. A definite resolution of the state law claims would not necessarily avoid 5 a constitutional adjudication and, therefore, the second criterion does not support abstention. The third criterion crystalizes the difficulty with the Defendants’ request for abstention: 6 7 “[T]he proper resolution of the possible determinative issue of state law is uncertain[.]” Porter, 8 319 F.3d at 492. “Where there is no ambiguity in the state statute, the federal court should not 9 abstain but should proceed to decide the federal constitutional claim. 5:* Wisconsin v. 10 Constantineau, 400 U.S. 433, 439 (1971). Defendant has not identified “an unsettled issue of 11 state or local law that would be determinative of the federal claims.” Hancock v. City of 12 Ridgefield, No. C09-5580BHS, 2009 U.S. Dist. LEXIS 117948, at *6 (W.D. Wash. 2009) 13 (emphasis added); {See Def. Mot. at 16-24 (no state or local law has been identified)); see also 14 angular Wireless, LLC v. Thurston Cty., 150 F. App’x 633, 635-36 (9th Cir. 2005) (finding 15 that Pullman abstention is not appropriate absent “an unsettled area of state law”). Defendants 16 do not identify any “unclear” or “unsettled” state law and, accordingly, they have not met the 17 third criterion necessary for Pullman abstention. 18 III. Abstention is not proper under the Colorado River doctrine. 19 The Defendants also argue that this Court should abstain from determining the 20 Commerce Clause claim under the Supreme Court’s decision in Colorado River, but 21 [gjenerally, as between state and federal courts, the rule is that ‘pendency of an action in the 22 state court is no bar to proceedings concerning the same matter in the Federal court having 23 jurisdiction[.]” Colo. River, 424 U.S. at 817 (quoting McC/e/Za/r v. Carland, 217 U.S. 268, 282 24 (1910)). “Only in rare cases will ‘the presence of a concurrent state proceeding’ permit the ? 55 25 district court to dismiss a concurrent federal suit ‘for reasons of wise judicial administration.’” 26 AMICUS CURIAE BRIEF IN OPPOSITION TO DEFENDANTS’ MOTION FOR ABSTENTION BY WYOMING, KANSAS, MONTANA, NEBRASKA, SOUTH DAKOTA AND UTAH No.: 3;18-cv-05005-RJB Page 12 Bullivant Housciil}aile> 1>C 1700 SeveiMh Avenue, Suite 1810 Seattle, Washington 98101-1.397 Telephone: 206.292,8930 Case 3:18-cv-05005-RJB Document 78-2 Filed 05/08/18 Page 13 of 19 1 R.R. St. & Co. V. Transp. Ins. Co., 656 F.3d 966, 977-78 (9th Cir. 2011) (quoting Colo. River, 2 424 U.S. at 818)). 3 In Colorado River, the federal government brought a federal court action against 4 various water users seeking a declaration of rights on the Colorado River and several 5 tributaries. Colorado River, 424 U.S. at 805. Colorado had already established water districts 6 to adjudicate water rights in state courts. Id. at 804. The federal district court dismissed the 7 action in deference to the state court proceedings. Id. at 806. The Supreme Court affirmed, 8 stressing, in particular, the “highly interdependent” relationship between the claims in the two 9 courts and federal policy, embodied in law, of avoiding the piecemeal adjudication of water 10 rights. Id. at 819-20; see also R.R. St. & Co., 656 F.3d at 978. 11 Given the factual context of this case, the Colorado River abstention doctrine is not 12 applicable because "'Colorado River was a state law case that the Government sought to have 13 federally adjudicated ... [tjhis case is the converse: a federal law case that the state seeks to 14 have adjudicated in state court.” Morros, 268 F.3d at 707. This case does not present a situation 15 where “there is evidence of a strong federal policy that all claims should be tried in the state 16 courts.” Morros, 268 F.3d at 706-07. The federal adjudication of the Commerce Clause claims 17 would not reach into an area of concern specific to the state; rather, it concerns an area of 18 particular concern to the federal government: interstate commerce. Therefore, this is not a 19 rare” or “exceptional” case that calls for the federal court to abstain from adjudicating federal 20 claims, and this Court should proceed to adjudicate the Commerce Clause claims. See Daniels 21 Sharpsmart, 2017 U.S. Dist. LEXIS 90840, at *14-15 (“This case is premised on [a] claim, 22 brought under a federal statute, that [djefendants violated the Commerce Clause, a provision 23 of the federal constitution. ... Consequently, Colorado River abstention has no applicability 24 here.”) (citations and quotation marks omitted). 25 Considering the substance of the Defendants’ motion also leads to the conclusion that 26 abstention is not appropriate under the circumstances. To determine whether the federal case AMICUS CURIAE BRIEF IN OPPOSITION TO DEFENDANTS’ MOTION FOR ABSTENTION BY WYOMING, KANSAS, MONTANA, NEBRASKA, SOUTH DAKOTA AND UTAH No.: 3:I8-cv-05005-RJB Page 13 Biillivaiit HoiisciiBailey PC 1700 Seventh .Avenue, Suite 1810 Seattle, Washington 98101-1397 Telephone: 206!292.8930 Case 3:18-cv-05005-RJB Document 78-2 Filed 05/08/18 Page 14 of 19 presents the “exceptional circumstances” justifying abstention under Colorado River, “the 9 district court must carefully consider ‘both the obligation to exercise Jurisdiction and the 3 combination of factors counseling against that exercise.’” R.R. St. & Co., 656 F.3d at 978 4 (quoting Colo. River, 424 U.S. at 818). The Ninth Circuit applies eight factors for assessing 5 the appropriateness of a Colorado River stay or dismissal: 6 7 8 9 (1) which court first assumed jurisdiction over any property at stake; (2) the inconvenience of the federal forum; (3) the desire to avoid piecemeal litigation; (4) the order in which the forums obtained jurisdiction; (5) whether federal law or state law provides the rule of decision on the merits; (6) whether the state court proceedings can adequately protect the rights of the federal litigants; (7) the desire to avoid forum shopping; and (8) whether the state court proceedings will resolve all issues before the federal court. 10 11 R.R. St. & Co., 656 F.3d at 978-79. Defendants conclude that lactors 3, 4, 6, 7, and 8 weight 12 in favor abstention. But neither these five factors, nor the other three, weigh in favor of 13 abstention. 14 The Colorado River court was primarily concerned with avoiding piecemeal litigation. 15 Morros, 268 F.3d at 706-07 (quoting Colo. River, 424 U.S. at 819). “Piecemeal litigation 16 occurs when different tribunals consider the same issue, thereby duplicating efforts and 17 possibly reaching different results ... [t]he mere possibility of piecemeal litigation does not 18 constitute an exceptional circumstance.” R.R. St. & Co., 656 F.3d at 979 (internal quotations 19 and citations omitted). 20 21 22 23 24 25 26 Colorado River does not say that every time it is possible for a state court to obviate the need for federal review by deciding factual issues in a particular way, the federal court should abstain. As the Supreme Court has observed, such a holding would “make a mockery of the rule that only exceptional circumstances justify a federal court’s refusal to decide a case in deference to the States.” Rather, Colorado River stands for the proposition that when Congress has passed a law expressing a preference for unified state adjudication, courts should respect that preference. As the Third Circuit astutely observed, “it is evident that the avoidance of piecemeal litigation factor is met, as it was in ... Colorado River itself, only when there is evidence of a strong federal policy that all claims should be tried in the state courts. AMICUS CURIAE BRIEF IN OPPOSITION TO DEFENDANTS’ MOTION FOR ABSTENTION BY WYOMING, KANSAS, MONTANA, NEBRASKA, SOUTH DAKOTA AND UTAH No.: 3:18-cv-05005-RJB Page 14 ISiillivant H()usciiBiiiley PC 1700 Seventh .Avenue, Suite 1810 Seattle, Washington 98101-1397 Telephone- 206.292.8930 Case 3:18-cv-05005-RJB Document 78-2 Filed 05/08/18 Page 15 of 19 1 Morros, 268 F.3d at 706-07 (footnotes and internal quotation marks omitted). This case oflers 2 only the mere possibility of piecemeal litigation. There is no identified federal policy favoring 3 the adjudication in the state courts of constitutional claims of state official misconduct in 4 administrative permitting.' This factor strongly favors this Court exercising its jurisdiction to 5 adjudicate these claims. The fourth factor is the order in which jurisdiction was obtained. The Defendants admit 6 7 the measure of the weight given to this factor does not depend on whether the state was the 8 first to exercise jurisdiction. (Def Mot. at 22). Indeed, “[t]he mere existence of a case on the 9 state docket in no way causes a substantial waste of judicial resources nor imposes a burden 10 on the defendant which would justify abstention.” Travelers Indem. Co. v. Madonna, 914 F.2d 11 1364, 1370 (9th Cir. 1990). Further, abstention is particularly inappropriate when the federal 12 proceeding, like this case, is brought under 42 U.S.C. § 1983. See Daniels Sharpsmart, 2017 13 U.S. Dist. LEXIS 90840, at *19-20; see also Pue v. Sillas, 632 F.2d 74, 77 n.4 (9th Cir. 1980). Defendants acknowledge the progress of the state proceedings but do not offer any 14 15 analysis of how that progress affects the federal litigation. See Moses H. Cone Mem 7 Hasp. v. 16 Mercury Constr. Corp., 460 U.S. 1, 28 (1983) (stating that Colorado River abstention 17 contemplates that “the parallel state-court litigation will be an adequate vehicle for the 18 complete and prompt resolution of the issues ... [i]f there is any substantial doubt as to this, it 19 would be a serious abuse of discretion to grant the stay or dismissal at all”). A recitation of the 20 progress of the state court proceedings tells us nothing about the adequacy of that vehicle to 21 completely and promptly resolve those claims; nor does it address the consequences of this 22 action being filed under 42 U.S.C. § 1983. Thus, this factor does not support abstention. 23 24 25 1 For example, the Washington Shorelines Hearings Board’s enabling statutes and administrative rules do not provide that body with jurisdiction to consider federal constitutional questions. See RCW 90.58 26 et seq.,and WAC 461-8-315." AMICUS CURIAE BRIEF IN OPPOSITION TO DEFENDANTS’ MOTION FOR ABSTENTION BY WYOMING, KANSAS, MONTANA, NEBRASKA, SOUTH DAKOTA AND UTAH No.: 3:I8-cv-05005-RJB Page 15 I5ullivant II()useiiBailcy I’C 1700 Seventh Avenue, Suite 1810 Seattle, Washington 98101-1397 Telephone 206.292,8930 Case 3:18-cv-05005-RJB Document 78-2 Filed 05/08/18 Page 16 of 19 Applying the sixth factor, courts are to ask whether the state court proceedings can 0 adequately protect the rights of the federal litigants. Defendants interpret this to mean that so 3 long as the state courts are competent to hear federal constitutional claims, then the factor 4 weighs in favor of abstention. (Def. Mot. at 21). Defendants misinterpret the nature of the 5 factor. The Ninth Circuit “has not applied this factor against the exercise of federal jurisdiction, 6 only in favor of it.” Travelers, 914 F.2d at 1370. “This factor, like choice of law, is more 7 important when it weighs in favor of federal jurisdiction.” Id. (quoting Bethlehem. Contracting Co. V. Lehrer/McGovern, Inc., 800 F.2d 325, 328 (2d Cir. 1986); see cdso R.R. St. & Co., 656 9 F.3d at 981. This factor is of no value to the Defendants’ argument because to the extent the 10 courts consider the factor, it is only to determine whether it weighs in favor of federal jurisdiction, not against it. So, even if a party advocating abstention can show that the state 12 tribunal can protect the rights of the federal plaintiff, this factor is merely eliminated from 13 consideration; it lacks any weight. By asking this Court to weigh this factor in favor of 14 abstention. Defendants err. 15 The seventh factor addresses concerns over forum shopping. Naturally, the Defendants 16 argue that this factor weighs in favor abstention because Lighthouse, allegedly, did not focus 17 its efforts in the forum that it deems most favorable, [but] has flung its claims across as many 18 forums as possible in the hopes of finding a single sympathetic one ... [with] [t]he result 19 [being] vexatious litigation in which [Lighthouse] seeks to litigate five lawsuits 20 simultaneously.” (Def. Mot. at 24). 21 i.<. In the Colorado River context, this Circuit has held that forum shopping weighs in 22 fevor of a stay when the party opposing the stay seeks to avoid adverse rulings made by the 23 state court or to gain a tactical advantage from the application of federal court rules.” Travelers, 24 914 F.2d at 1371. Defendants do not identify any adverse state court ruling Lighthouse is 25 seeking to avoid or how the federal court rules could give Lighthouse a tactical advantage in 26 this litigation. Further, that there are on-going state lawsuits has more to do with the fractured AMICUS CURIAE BRIEF IN OPPOSITION TO DEFENDANTS’ MOTION FOR ABSTENTION BY WYOMING, KANSAS, MONTANA, NEBRASKA, SOUTH DAKOTA AND UTAH No.: 3:I8-cv-05005-RJB Page 16 BullivantlHoiiscrilJiiiley PC 1700 Sevemli Avenue, Suite 1810 Seattle, Washington 98101-1397 Telephone- 206'292,8930 Case 3:18-cv-05005-RJB Document 78-2 Filed 05/08/18 Page 17 of 19 permitting process employed by the State of Washington than it does with any conscious 2 choice by Lighthouse to seek out advantageous forums or to create vexatious litigation. Unless 3 the Defendants are advocating that a party must give up certain due process rights to appeal 4 adverse state rulings before filing an action in federal court, there is no evidence of forum 5 shopping. 6 The final factor the Defendants contend weighs in favor of abstention is the eighth one 7 in which this court should ask whether the state court proceedings will resolve all issues before 8 it. Defendants argue that all they need show is that the state courts can adequately protect the 9 rights of the litigants in the federal case for this factor to favor abstention. (Def Mot. at 2010 21). But this factor favors abstention when the parallel state court proceeding will “ensure 11 comprehensive disposition of litigation ... [o]therwise, a stay or dismissal will neither conserve 12 judicial resources nor prevent duplicative litigation.” R.R. St. & Co., 656 F.3d at 982-83. 13 Defendants’ argument on this factor rests solely on the existence of parallel state proceedings. 14 There is no analysis of whether the state court proceedings will “ensure [a] comprehensive 15 disposition of [the] litigation.” Accordingly, this factor is of little weight. 16 The ultimate “decision whether to dismiss a federal action because of parallel state- 17 court litigation hinges on a carelul balancing of the [relevant] factors ... with the balance 18 heavily weighted in favor of the exercise of jurisdiction.” R.R. St. & Co., 656 F.3d at 983 19 (quoting Moses H. Cone, 460 U.S. at 16). In this case, the balance weighs overwhelmingly in 20 favor of this Court exercising jurisdiction. 21 22 I. CONCLUSION The Defendants failed to meet their burden to show that the Commerce Clause claims 23 set forth in Lighthouse’s Complaint are of the rare and extraordinary type that would support 24 abstention. Accordingly, amicus curiae the States of Wyoming, Kansas, Montana, Nebraska, 25 South Dakota, and Utah respectfully request that this Court deny the Motion for Abstention 26 and proceed to adjudicate the Commerce Clause claims. AMICUS CURIAE BRIEF IN OPPOSITION TO DEFENDANTS’ MOTION FOR ABSTENTION BY WYOMING, KANSAS, MONTANA, NEBRASKA, SOUTH DAKOTA AND UTAH No.: 3:I8-cv-05005-RJB Page 17 Biillivant Hou.sciiBailey PC 1700 Seventh Avenue, Suite 1810 Seattle, Washington 98101-1397 Telephone- 206.292,8930 Case 3:18-cv-05005-RJB Document 78-2 Filed 05/08/18 Page 18 of 19 1 DATED: May 8, 2018 BULLIVANT HOUSER BAILEY PC 2 3 By /s/Michael A. Guadagno_______________ Michael A. Guadagno, WSBA #34633 E-mail: michaeLguadagno@bullivant.com 4 5 6 By /s/ Holly D. Brauchli_______________ Holly D. Brauchli, WSBA #44814 E-mail: holly.brauchli@bullivant.com 7 8 By A/ Rachel Tallon Reynolds___________ Rachel Tallon Reynolds, WSBA #38750 E-mail: rachel.reynolds@bullivant.com 9 10 11 Erik E. Petersen, (Pro Hac Vice Admission Pending) Michael M. Robinson, (Pro Hac Vice Admission Pending) Senior Assistant Attorneys General Wyoming Attorney General’s Office 2320 Capitol Avenue Cheyenne, WY 82002 (307) 777-6946 (phone) (307) 777-3542 (fax) erik.petersen@wyo.gov mike.robinson@wyo.gov 12 13 14 15 16 17 18 19 Attorneys for the State of Wyoming 4826-4881-3925.1 20 21 22 23 24 25 26 AMICUS CURIAE BRIEF IN OPPOSITION TO DEFENDANTS’ MOTION FOR ABSTENTION BY WYOMING, KANSAS, MONTANA, NEBRASKA, SOUTH DAKOTA AND UTAH No.: 3:18-cv-05005-R,lB Page 18 Biilliviint H()useiiHailcy PC 1700 Seventli .Avcmic, Soiie 1810 Seattle. Wasliingtoii 98101-1.397 Telephone; 206.292.8930 Case 3:18-cv-05005-RJB Document 78-2 Filed 05/08/18 Page 19 of 19 1 CERTIFICATE OF SERVICE 2 The undersigned attorney certifies that on the 8th day of May, 2018,1 electronically 3 filed the foregoing with the Clerk of the Court using the CM7ECF system which will send 4 notification of such filing to all counsel on record in the matter. 5 6 7 8 9 /s/ Rachel Tallon Reynolds___________ Rachel Tallon Reynolds, WSBA #38750 E-mail: rachel.reynolds@bullivant.com 1700 Seventh Avenue, Suite 1810 Seattle, WA 98101 Telephone; 206-292-8930 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 AMICUS CURIAE BRIEF IN OPPOSITION TO DEFENDANTS’ MOTION FOR ABSTENTION BY WYOMING, KANSAS, MONTANA, NEBRASKA, SOUTH DAKOTA AND UTAH No.: 3:I8-cv-05005-RJB Page 19 15iillivant Hoiiset jl}ailey PC 1700 Scvcnili .Avenue, Suiie 1810 Seattle, Washington 98101-1397 Telephone: 206.292.8930