Hired skippers lawsuit

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Smith & Hennessey PLLC

Attorneys at Law 316 Occidental Avenue South, Suite 500

Seattle, Washington 98104 Telephone: (206) 292-1770 Facsimile: (206) 292-1790

COMPLAINT- 1

UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON

AT TACOMA

FAIRWEATHER FISH, INC., et al.,

Plaintiffs,

v.

PENNY PRITZKER, in her official capacity as Secretary of Commerce, et al.,

Defendants.

NO. 3:14-cv-05685-BHS

FIRST AMENDED COMPLAINT

I. INTRODUCTION

1. Plaintiffs Fairweather Fish, Inc., a Washington corporation (“Fairweather Fish”)

and Captain Ray Welsh (“Captain Welsh”) (sometimes collectively referred to as “Plaintiffs”)

challenge a final rule entitled “Fisheries of the Exclusive Economic Zone Off Alaska: Pacific

Halibut and Sablefish Individual Fishing Quota Program” (“Final Rule”), 79 Fed. Reg. 43679

(July 28, 2014), promulgated on July 28, 2014, by Defendants Secretary of Commerce Penny

Pritzker, National Oceanic and Atmospheric Administration (“NOAA”), Kathryn D. Sullivan,

Case 3:14-cv-05685-BHS Document 18 Filed 10/30/14 of 40

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COMPLAINT- 2

Administrator of National Marine Fisheries Service (“NMFS”), and Eileen Sobeck, Assistant

Administrator for NMFS (collectively “Defendants”).

2. The Final Rule amends the hired master provisions of the Individual Fishing

Quota Program (“IFQ Program”) for the fixed-gear commercial halibut and sablefish fisheries

off the coast of Alaska at 679 C.F.R. §§ 679.41 and 679.42.

3. The Final Rule approves three amendments to the regulations that govern the IFQ

Program (the “Amended Regulations”). The first two amendments add regulations at 50 C.F.R.

§ 679.42(i)(8) and (j)(10) to specify that a hired master (skipper) cannot be used to fish IFQ

halibut or sablefish derived from catcher vessel quota shares (“QS”) that were received by

transfer after February 12, 2010, with a limited exception for small amounts of QS. The third

amendment adds regulations under 50 C.F.R. § 679.41(c)(11) specifying that NMFS will not

approve a transfer of catcher vessel QS to a corporation, partnership, association, or other non-

individual entity at any time.

4. The Final Rule and Amended Regulations are unlawful because they violate the

Rehabilitation Act of 1973, 29 U.S.C. §§ 701 et seq. (“Rehabilitation Act”); the Magnuson-

Stevens Fishery Conservation and Management Act, 16 U.S.C. §§ 1801-1884 (“Magnuson-

Stevens Act”); the Northern Pacific Halibut Act of 1982, 16 U.S.C. §§ 773 et seq. (“Halibut

Act”); the United States Constitution; and the Administrative Procedure Act 5 U.S.C. §§ 701-706

(“APA”). The Final Rule and Amended Regulations violate the Rehabilitation Act by excluding

otherwise qualified individuals with a disability from participating in the IFQ Program. The

Final Rule and Amended Regulations violate the Magnuson-Stevens Act, the Halibut Act, and

the APA in that they are impermissibly retroactive and arbitrary and capricious. The Final Rule

and Amended Regulations violate the Fifth Amendment of the United States Constitution by


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COMPLAINT- 3

denying Plaintiffs due process of law. The Final Rule and Amended Regulations violate

National Standard Four of the Magnuson-Stevens Act and the Halibut Act in that they are not

fair and equitable. The Final Rule and Amended Regulations violate National Standard One of

the Magnuson-Stevens Act by failing to achieve optimum yield. The Final Rule and Amended

Regulations violate National Standard Two of the Magnuson-Stevens Act in that they are not

based on the best scientific information available. The Final Rule and Amended Regulations

violate National Standard Nine of the Magnuson-Stevens Act by failing to minimize bycatch.

The Final Rule and Amended Regulations violate National Standard Ten of the Magnuson-

Stevens Act by failing to promote the safety of human life at sea. The Magnuson-Stevens Act

specifies that Defendants shall not approve a fishery management plan, an amendment thereto, or

any implementing regulations (sometimes collectively referred to herein as “FMP”) unless the

FMP is consistent with the Magnuson-Stevens Act and any other applicable law. The Final Rule

and Amended Regulations violate the Magnuson-Stevens Act by failing to comply with the

applicable law set forth above.

5. Defendants’ actions, omissions, and conduct in promulgating the Final Rule and

approving the Amended Regulations also result in damage to initial QS recipients who are

corporations, partnerships, associations and other entities, including Plaintiff Fairweather Fish,

by prohibiting such entities from using a hired master to harvest IFQ derived from catcher vessel

QS received by transfer after February 12, 2010. As a corporation, Fairweather Fish is not able

to be on board its vessel when harvesting halibut or sablefish QS. Accordingly, Fairweather Fish

relies on a hired master to harvest its halibut and sablefish QS. If the Final Rule is upheld and

the Amended Regulations become effective, Fairweather Fish and others like it will not be able

to harvest their QS received by transfer after February 12, 2010. Further, Fairweather Fish and


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COMPLAINT- 4

others like it will be limited in their ability to participate in the IFQ Program going forward, as

Fairweather Fish and similar entities will not be able to acquire and harvest additional QS.

Fairweather Fish and others like it will be limited and restricted to harvesting only the QS that

they acquired prior to February 12, 2010. Fairweather Fish and others like it will suffer

additional economic harm if the Final Rule is upheld and the Amended Regulations are

implemented because they will be unable to obtain the same price for their QS as they would

otherwise receive due to the negative impact the Final Rule and Amended Regulations will have

on supply and demand. Fairweather Fish and others like it will also be forced to sell their QS

received by transfer after February 12, 2010, and thus will incur a capital gains tax.

6. Defendants’ actions, omissions, and conduct in promulgating the Final Rule and

approving the Amended Regulations result in damage to initial QS recipients, who are otherwise

qualified individuals with a disability, including Plaintiff Captain Welsh, by prohibiting such

individuals from using a hired master to harvest IFQ derived from catcher vessel QS received by

transfer after February 12, 2010. Specifically, the Final Rule and Amended Regulations exclude

otherwise qualified individuals with a disability from employing a hired master, which precludes

those individuals from harvesting their allotted IFQ or, alternatively, require those individuals to

be present on board their vessel when doing so would be unsafe due to their disabilities. As a

result of his disabilities, Captain Welsh is not able to be on board his vessel when harvesting

halibut or sablefish QS. Accordingly, Defendants’ actions and failures will harm Captain Welsh

by prohibiting him, and others like him, from using a hired master to harvest IFQ derived from

catcher vessel QS received by transfer after February 12, 2010. If the Final Rule is upheld and

the Amended Regulations become effective, Captain Welsh and others like him will not be able

to harvest their QS received by transfer after February 12, 2010. Further, Captain Welsh and


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COMPLAINT- 5

others like him will be limited in their ability to participate in the IFQ Program going forward, as

Captain Welsh and others like him will not be able to acquire and harvest additional QS. Captain

Welsh and others like him will be limited and restricted to harvesting only the QS that they

acquired prior to February 12, 2010. Captain Welsh and others like him will suffer additional

economic harm if the Final Rule is upheld and the Amended Regulations are implemented

because they will be unable to obtain the same price for their QS as they would otherwise receive

due to the negative impact the Final Rule and Amended Regulations will have on supply and

demand. The Final Rule and Amended Regulations will drastically narrow the number of

eligible potential transferees of QS while increasing the number of transferors, thereby causing a

reduction in the price of QS.

7. Defendants misconstrue the fundamental purpose of the IFQ Program which was

to promote the conservation and management of halibut and sablefish resources by reducing

excessive fishing capacity in the commercial halibut and sablefish fixed-gear fisheries.

Defendants’ attempt to characterize/transform the fundamental purpose of the IFQ Program to an

accelerated owner on board standard violates the applicable laws referenced above. The Final

Rule and Amended Regulations do not promote environmental conservation and will have no

effect on protecting halibut and sablefish resources. Instead, the Final Rule and Amended

Regulations attempt to engage in social engineering by advancing an owner on board standard

which unlawfully impacts the economic welfare of corporations/entities and discriminates

against otherwise qualified disabled individuals.

II. JURISDICTION AND VENUE

8. This action arises under the Rehabilitation Act, the Magnuson-Stevens Act, the

Halibut Act, the United States Constitution, and the APA.


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COMPLAINT- 6

9. This Court has jurisdiction over the action pursuant to Section 504 of the

Rehabilitation Act, 29 U.S.C. § 794; the Magnuson-Stevens Act, 16 U.S.C. § 1861(d) (“[t]he

district courts of the United States shall have exclusive jurisdiction over any case or controversy

arising under [the Act]”); the Halibut Act, 16 U.S.C. 773i(d) (district courts have exclusive

jurisdiction); the APA, 5 U.S.C. §§ 701-706 (final agency actions are subject to judicial review);

28 U.S.C. § 1331 (district courts have “original jurisdiction of all civil actions arising under the

… laws … of the United States”); and 28 U.S.C. § 1361 (district courts have original jurisdiction

over any action in the nature of mandamus to compel an officer or employee of the United States

or any agency thereof to perform a duty owed to the plaintiff).

10. The Magnuson-Stevens Act provides that actions taken by the Secretary of

Commerce in issuing regulations to implement an FMP shall be subject to judicial review “if a

petition for such review is filed within 30 days after the date on which the regulations are

promulgated or the action is published in the Federal Register, as applicable.” 16 U.S.C.

§ 1855(f)(1). Defendants published the Final Rule amending the hired master provisions of the

IFQ Program on July 28, 2014 in the Federal Register. Plaintiffs file this Complaint within 30

days of the publication of the Final Rule.

11. This Court has the authority to grant the relief sought in this action pursuant to the

Declaratory Judgment Act (28 U.S.C. §§2201-02), the Magnuson-Stevens Act (16 U.S.C.

§ 1855(d) and (f)), the Halibut Act (16 U.S.C. § 773i(d)), 42 U.S.C. § 1983, and the APA

(5 U.S.C. §§ 705, 706).

12. Venue is proper in this judicial district pursuant to 28 U.S.C. §1391(e) because a

substantial part of the events and omissions giving rise to the claim occurred in this district and

because Plaintiff Fairweather Fish has its corporate headquarters in this district.


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COMPLAINT- 7

III. PARTIES

13. Fairweather Fish, Inc. Plaintiff Fairweather Fish is a small, family-owned

business that has its corporate headquarters in Gig Harbor, Washington. At the inception of the

IFQ Program in the early 1990’s, Fairweather Fish was issued initial QS to harvest halibut and

sablefish. Fairweather Fish received by transfer (purchased) five separate QS after February 12,

2010. Fairweather Fish has a 20% or greater ownership interest in the vessel(s) that harvest its

QS and currently is qualified to participate in the IFQ Program. If the Final Rule is made

effective and the Amended Regulations are implemented, Fairweather Fish will have been

qualified to participate fully in the IFQ Program up to and until that time. As a corporation,

Fairweather Fish relies on a hired master to harvest its QS.

14. Captain Ray Welsh. Plaintiff Captain Welsh is an individual residing in Anchor

Point, Alaska, who received initial QS in his name when the IFQ Program was first

implemented. In July, 2010, Captain Welsh sold halibut QS and received by transfer (purchased)

sablefish QS. Captain Welsh has a 20% or greater ownership interest in the vessel(s) that harvest

his QS and currently is qualified to participate in the IFQ Program. If the Final Rule is made

effective and the Amended Regulations are implemented, Captain Welsh will have been

qualified to participate fully in the IFQ Program up to and until that time. Captain Welsh has

physical and mental impairments that substantially limit several major life activities, including

his ability to perform manual tasks, lift, bend, read, concentrate, think, communicate, walk, learn,

and/or work. Captain Welsh is an otherwise qualified “individual with a disability,” as that term

is defined in 29 U.S.C. § 705(20), and is a “qualified individual with handicaps” as that term is

defined in 15 C.F.R. § 8c.3. Accordingly, Captain Welsh hires, relies on, and is entitled to a

skipper to harvest his QS.


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COMPLAINT- 8

15. Penny Pritzker. Defendant Penny Pritzker is sued in her official capacity as the

Secretary of the United States Department of Commerce (“Secretary”). Ms. Pritzker is

ultimately responsible for overseeing the proper administration and implementation of the

Magnuson-Stevens Act. She is also responsible for her Department’s compliance with section

504 of the Rehabilitation Act.

16. National Oceanic and Atmospheric Administration. NOAA is an agency of

the United States Department of Commerce with supervisory responsibility for NMFS. The

Secretary has delegated responsibility to ensure compliance with the Magnuson-Stevens Act to

NOAA which, in turn, has sub-delegated that responsibility to NMFS.

17. Kathryn D. Sullivan. Defendant Kathryn Sullivan is the Administrator of

NOAA, and thus is charged with the responsibility to ensure that the requirements of the

Magnuson-Stevens Act and other applicable law are followed and enforced.

18. National Marine Fisheries Service. Defendant NMFS is an agency of the

United States Department of Commerce that has been delegated the primary responsibility to

ensure that the requirements of the Magnuson-Stevens Act and other applicable law are followed

and enforced.

19. Eileen Sobeck. Defendant Eileen Sobeck is Assistant Administrator for NMFS,

and is charged with administration of the Magnuson-Stevens Act and other applicable law with

respect to living marine resources.

IV. LEGAL BACKGROUND

A. The Rehabilitation Act.

20. Section 504 of the Rehabilitation Act states, “No otherwise qualified individual

with a disability in the United States ... shall, solely by reason of her or his disability, be


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COMPLAINT- 9

excluded from the participation in, be denied the benefits of, or be subjected to discrimination

under any program or activity receiving Federal financial assistance or under any program or

activity conducted by any Executive agency or by the United States Postal Service.” 29 U.S.C.

§ 794(a) (“Section 504”).

21. Agencies may promulgate regulations that implement the requirements

concerning the treatment of individuals contained in Section 504.

22. The Department of Commerce published regulations implementing the

Rehabilitation Act and prohibiting discrimination in its programs on the basis of handicap at

15 C.F.R. pt. 8c (1988) (“Department of Commerce Regulations”).

23. The Rehabilitation Act and the Department of Commerce Regulations apply to

the IFQ Program. 15 C.F.R. § 8c.2 (“This part applies to all programs or activities conducted by

the agency except for programs or activities conducted outside the United States that do not

involve individuals with handicaps in the United States.”).

24. The Department of Commerce Regulations provide that “no qualified individual

with handicaps shall, on the basis of handicap, be excluded from participation in, be denied the

benefits of, or otherwise be subjected to discrimination under any program or activity conducted

by the agency.” 15 C.F.R. § 8c.30.

25. An “individual with handicaps” means, “any person who has a physical or mental

impairment that substantially limits one or more major life activities, has a record of such an

impairment, or is regarded as having such an impairment.” 15 C.F.R. § 8c.3.

26. A “qualified individual with handicaps” means “(1) With respect to any agency

program or activity under which a person is required to perform services or to achieve a level of

accomplishment, an individual with handicaps who meets the essential eligibility requirements


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COMPLAINT- 10

and who can achieve the purpose of the program or activity without modifications in the program

or activity that the agency can demonstrate would result in a fundamental alteration in its nature;

(2) With respect to any other program or activity, an individual with handicaps who meets the

essential eligibility requirements for participation in, or receipt of benefits from, that program or

activity; and (3) ‘Qualified handicapped person’ as that term is defined for purposes of

employment in 29 CFR 1613.702(f), which is made applicable to this part by § 8c.40.”

15 C.F.R. § 8c.3.

B. The Magnuson-Stevens Act.

27. Congress enacted the Magnuson-Stevens Act, among other purposes, “to conserve

and manage the fishery resources found off the coasts of the United States,” “to promote

domestic commercial and recreational fishing under sound conservation and management

principles,” and “to provide for the preparation and implementation, in accordance with national

standards, of fishery management plans which will achieve and maintain, on a continuing basis,

the optimum yield from each fishery.” 16 U.S.C. § 1801(b)(1), (3)-(4). The Act created eight

regional fishery management councils, including the North Pacific Fishery Management Council

(“Council”) that recommended the IFQ Program at issue this case. 16 U.S.C. § 1852. These

councils must develop, and submit to the Secretary for approval, FMPs and “amendments to each

such plan that are necessary from time to time (and promptly whenever changes in conservation

and management measures in another fishery substantially affect the fishery for which such plan

was developed).” 16 U.S.C. § 1852(b), (h)(1).

28. All FMPs and implementing regulations prepared by the regional fishery

management councils are subject to final review and approval by NMFS. The Magnuson-

Stevens Act requires that an FMP, including FMP amendments, and any regulations promulgated


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COMPLAINT- 11

to implement such plans or amendments, cannot be approved unless they are consistent with the

Magnuson-Stevens Act and “other applicable law.” 16 U.S.C. § 1854(a) and (b).

29. The Rehabilitation Act, the Halibut Act, and the U.S. Constitution are other

“applicable laws” with which an FMP and FMP amendment, including their implementing

regulations, must be consistent.

30. FMPs must comply with ten national standards under the Magnuson-Stevens Act,

including the following: (1) Conservation and management measures shall prevent overfishing

while achieving, on a continuing basis, the optimum yield from each fishery for the United States

fishing industry; (2) Conservation and management measures shall be based upon the best

scientific information available; (4) Conservation and management measures shall not

discriminate between residents of different States. [“If it becomes necessary to allocate or assign

fishing privileges among various United States fishermen, such allocation shall be (A) fair and

equitable to all such fishermen; (B) reasonably calculated to promote conservation; and

(C) carried out in such manner that no particular individual, corporation, or other entity acquires

an excessive share of such privileges.”]; (9) conservation and management measures shall, to the

extent practicable, minimize bycatch; and (10) Conservation and management measures shall, to

the extent practicable, promote the safety of human life at sea.” 16 U.S.C. § 1851(a)(1), (2), (4),

(9) and (10). The national standards are designed to promote conservation, not the economic

welfare of individuals over that of corporations or entities.

31. The Magnuson-Stevens Act provides that an FMP may “establish a limited access

system for the fishery in order to achieve optimum yield if, in developing such system, the

Council and the Secretary take into account, (A) present participation in the fishery;

(B) historical fishing practices in, and dependence on, the fishery; (C) the economics of the


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COMPLAINT- 12

fishery; (D) the capability of fishing vessels used in the fishery to engage in other fisheries;

(E) the cultural and social framework relevant to the fishery and any affected fishing

communities; (F) the fair and equitable distribution of access privileges in the fishery; and

(G) any other relevant considerations.” 16 U.S.C. § 1853(b)(6).

32. In establishing a limited access privilege program, the Council is required, inter

alia, to “establish a policy and criteria for the transferability of limited access privileges (through

sale or lease) that is consistent with the policies adopted by the Council for the fishery under [16

U.S.C. § 1853a(c)(5)(A)],” including but not limited to the requirement that the policies

“establish procedures to ensure fair and equitable initial allocations, including consideration of,

(i) current and historical harvests; (ii) employment in the harvesting and processing sectors;

(iii) investments in, and dependence upon, the fishery; and (iv) the current and historical

participation of fishing communities,” and “consider the basic cultural and social framework of

the fishery.” 16 U.S.C. §§ 1853a(c)(5)(A), (B).

33. The Magnuson-Stevens Act further provides that any limited access privilege

program to harvest fish shall promote fishing safety, fishery conservation and management; and

social and economic benefits. 16 U.S.C. § 1853a(c)(1)(C). By prohibiting otherwise qualified

disabled individuals from relying on a hired master to harvest their QS, the Final Rule and

Amended Regulations fail to promote fishing safety. For these disabled individuals to harvest

their QS received after February 12, 2010, the Final Rule and Amended Regulations require that

they be on board their vessel in blatant disregard of National Standard Ten, which requires that

conservation and management measures promote the safety of human life at sea.


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COMPLAINT- 13

34. The Council is responsible for amending the FMP “as necessary from time to time

(and promptly whenever changes in conservation and management measures in another fishery

substantially affect the fishery for which such plan was developed).” 16 U.S.C. § 1852(h)(1).

C. The Halibut Act.

35. The Secretary of Commerce and the International Pacific Halibut Commission

(“Commission”) manage fishing for Pacific halibut through regulations established under the

authority of the Halibut Act, 16 U.S.C. §§ 773-773k; 50 C.F.R. §§ 300.60-300.66. The

Commission recommends regulations governing the conservation of halibut stocks under the

Convention between the United States of America and Canada for the Preservation of the Halibut

Fishery of the Northern Pacific Ocean and Bering Sea (the “Convention”).

36. The Halibut Act provides the Secretary of Commerce with broad authority and

discretion to “adopt such regulations as may be necessary to carry out the purposes and

objectives of the Convention and [the Halibut Act].” 16 U.S.C. § 773c(b)(1). The Halibut Act

also provides the Council with the authority to recommend regulations to the Secretary of

Commerce, including limited access regulations. 16 U.S.C. § 773c(c). Any such regulations

“shall be consistent with the limited entry criteria set forth in section 1853(b)(6) [of the

Magnuson-Stevens Act].” Id.

37. If the Secretary makes an allocation decision or assigns halibut fishing privileges

among U.S. fisherman, “such allocation shall be fair and equitable to all such fishermen, based

upon the rights and obligations in existing Federal law, reasonably calculated to promote

conservation, and carried out in such manner that no particular individual, corporation, or other

entity acquires an excessive share of the halibut fishing privileges….” 16 U.S.C. § 773c(c).


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COMPLAINT- 14

D. The Administrative Procedure Act.

38. The APA requires that courts “hold unlawful and set aside agency action,

findings, and conclusions” that are, inter alia, “arbitrary, capricious, an abuse of discretion, or

otherwise not in accordance with law; contrary to constitutional right, power, privilege, or

immunity; in excess of statutory jurisdiction, authority, or limitations, or short of statutory right;

[or] without observance of procedure required by law; ….” 5 U.S.C. § 706(2)(A)-(D); 16 U.S.C.

§ 1855(f)(1)(B) (adopting the standards for judicial review under 5 U.S.C. § 706(2)). Defendants

must have “considered the relevant factors and articulated a rational connection between the

facts found and the choices made.” Midwater Trawlers Coop. v. Dept. of Commerce, 282 F.3d

710, 716 (9th Cir. 2002).

V. FACTUAL ALLEGATIONS

39. In 1992, the Council recommended a limited access system for the fixed gear

halibut and sablefish fisheries off Alaska. The halibut and sablefish Individual Fishing Quota

(“IFQ”) plan was approved in January 1993 and implemented on November 9, 1993. 58

Fed. Reg. 59375 (November 9, 1993). Fishing under the program began on March 15, 1995.

The central purpose of the IFQ Program was to resolve the conservation and management issues

commonly associated with open access fisheries.

40. Federal regulations at 50 C.F.R. part 679, established under the authority of the

Magnuson-Stevens Act, implement the IFQ Program for the halibut and for sablefish fisheries.

Additional federal regulations at 50 C.F.R. part 300, subpart E, and 50 C.F.R. part 679,

established under the authority of the Halibut Act, also govern the halibut fishery.

41. The IFQ Program was intended primarily to reduce excessive fishing capacity in

the commercial halibut and sablefish fixed-gear fisheries.


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COMPLAINT- 15

42. Access to the halibut and sablefish fisheries is limited to those persons holding

catcher vessel QS in specific management areas. The QS holder is the person authorized to

exercise the harvesting privilege in specific regulatory areas. NMFS initially issued QS to

qualified applicants (initial recipients) who owned or leased a vessel that made fixed-gear

landings of halibut or sablefish during the qualifying period from 1984 to 1990 for halibut, and

from 1985 to 1990 for sablefish. A person who received QS as an initial recipient was either

(1) an individual or natural person, or (2) a non-individual entity or person, such as a

corporation, partnership, or association. Initial recipients received QS allocations based on their

harvest during the qualifying period, the area of the harvest, and the type of vessel used to land

the harvest. QS are individual harvesting privileges that are given effect on an annual basis

through the issuance of individual fishing quota (“IFQ”) permits. An annual IFQ permit

authorizes the permit holder to harvest a specified amount of halibut or sablefish in a regulatory

area.

43. All QS are categorized according to the size of the vessel (category B, C, or D,

individually and collectively referred to as “catcher vessel QS”) from which halibut and sablefish

may be fished and whether that halibut or sablefish may be processed on board the vessel

(category A). The vessel categories were designed to ensure that the IFQ Program did not

radically change the structure of the fleet in place at the time the IFQ Program was implemented.

44. QS is transferrable from one person to another. The Council recommended and

NMFS implemented limits on the transfer (sale and purchase) and use of QS to limit

consolidation and maintain diversity of the IFQ fleet. For example, the IFQ Program only allows

persons who were originally issued catcher vessel QS (category B, C, and D halibut QS and


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category B and C sablefish QS), or persons who qualify as IFQ crew members, to hold and

transfer catcher vessel QS.

45. The regulations that govern the IFQ Program currently provide that individuals

and corporations, partnerships, or other non-individual entities in certain vessel categories who

received initial QS may rely on a hired master to harvest their QS if certain criteria are met,

including if the individual or entity owns a minimum 20-percent interest in the vessel on which

the IFQ species are harvested and if the individual or entity is represented on the vessel by an

employed hired master who is appropriately permitted. See 50 C.F.R. §§ 679.42(i)(1),

679.42(j)(1). By limiting the hired master exception to initial QS recipients, the Council

intended that all initial recipients would eventually retire from fishing, at which time their QS

would be transferred to other qualified fishermen and the IFQ fisheries would become

predominantly owner-operated.

46. In the preamble to the proposed rule implementing the IFQ Program, the

statement of the fundamental purpose of the IFQ Program includes no reference to any owner-

on-board (“OOB”) standard as a core reason for adopting the IFQ Program. 57 Fed. Reg. 57130

(Dec. 3, 1992) (“1992 Proposed Rule”) at 57130-31. By contrast, the objective of forcing

owners to be on board their respective vessels is the stated purpose of the Final Rule. See 79

Fed. Reg. 43680 (“This final rule is necessary to maintain progress toward a predominately

owner-onboard fishery.”).

47. The 1992 Proposed Rule stated it was the Council’s “intention” that persons

entering the fishery after adoption of the IFQ Program be individuals with commercial fishing

experience and be aboard the vessel when it was fishing. Id. at 57133. Thus, unlike the Final

Rule at issue herein, only new entrants to the fishery would be subject to an OOB requirement.


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48. The 1992 Proposed Rule further stated that the purpose of the OOB standard was

“to assure that catcher vessel QS would continue to be held by professional fishermen after the

initial allocation process....” 1992 Proposed Rule at 57138. (Emphasis added.)

49. Incorporating the stated intent and purpose of the 1992 Proposed Rule, the 1993

Final Rule confirmed that the Council had no fixed schedule or anticipated deadline for the

transition to an OOB fleet; rather, “[e]ventually, as the individuals and firms that received initial

allocations are replaced by new ones, all catcher vessel QS will be transferred to individuals in

keeping with the Council’s basic policy.” 58 Fed. Reg. 59375 (Nov. 9, 1993) (“1993 Final

Rule”) at 59392. (Emphasis added.)

50. In February 2010, the Council received public testimony and information that

caused it to be concerned about the apparent consolidation of QS and reduced opportunities for

new entrants (“second generation”) fishermen to enter the fishery. The Council approved a

Problem Statement and initiated an analysis to evaluate the economic and socioeconomic effects

of a proposed amendment to the IFQ Program which would restrict initial recipients use of a

hired master (skipper) to harvest IFQs transferred after February 12, 2010.

51. In February 2011, the Council released a proposed amendment to the IFQ

Program that would prohibit the use of hired skippers for certain QS transferred after February

12, 2010 (“Amendment”). The effect of the Amendment would be to require the IFQ owners to

be aboard their respective vessels when fishing for halibut or sablefish QS acquired after

February 12, 2010.

52. On April 26, 2013, NMFS published a proposed rule in the Federal Register

regarding the proposed Amendment, which would amend the hired master regulations for

management of the IFQ Program for the fixed-gear commercial fisheries for halibut and


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sablefish in waters off Alaska (“Proposed Rule”). 78 Fed. Reg. 24707 (Apr. 26, 2013). The 30-

day comment period on the proposed rule ended May 28, 2013.

53. On July 28, 2014, NMFS published the Final Rule amending the hired master

provisions of the IFQ Program for the fixed-gear commercial fisheries for halibut and sablefish

in waters off Alaska. 79 Fed. Reg. 43679 (July 28, 2014). The Final Rule prohibits an initial QS

recipient from using a hired master to harvest IFQ derived from catcher vessel QS received by a

transfer after February 12, 2010, with a limited exception for small amounts of QS. The Final

Rule approves the Amended Regulations, and will be effective on December 1, 2014.

54. Other than the proposed rule in the Federal Register on April 26, 2013 and the

Final Rule in the Federal Register on July 28, 2014, no other Federal Register notices were

published regarding the proposed rule or the Final Rule, including any notice with respect to the

February 12, 2010 control date.

55. The Final Rule and Amended Regulations prohibit all initial QS recipients,

including Plaintiffs Fairweather Fish and Captain Welsh, from using a hired master to harvest

IFQ derived from catcher vessel QS received by transfer after February 12, 2010. As a

corporation, Fairweather Fish can only harvest its halibut or sablefish QS by using a hired

master. As an otherwise qualified individual with a disability, Captain Welsh can only harvest

his halibut or sablefish QS by using a hired master or, alternatively, being present on board his

vessel when it would be unsafe due to his disability. If the Final Rule is upheld and the

Amended Regulations become effective, Plaintiffs Fairweather Fish and Captain Welsh and

others similarly situated will be limited and restricted to harvesting only the QS that they

acquired prior to February 12, 2010. As a direct result of such limitation and restriction,

Plaintiffs Fairweather Fish and Captain Welsh are damaged, inter alia, because they will not be


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able to harvest QS acquired after February 12, 2010, because they will not be able to acquire and

harvest additional QS, and because the value of QS that they acquired after February 12, 2010

will be substantially diminished.

VI. CAUSES OF ACTION

FIRST CLAIM FOR RELIEF VIOLATIONS OF THE REHABILITATION ACT

(29 U.S.C. §§ 701 et seq.) (Asserted by Captain Welsh)

(In the Alternative to the Second Claim for Relief)

56. Plaintiff incorporates paragraphs 1 through 26 and 39 through 55 of this

Complaint as if expressly set forth herein.

57. Plaintiff Captain Welsh suffers from a disability within the meaning of the

Rehabilitation Act. Captain Welsh is an individual with handicaps who meets the essential

eligibility requirements to participate in and receive the benefits from the IFQ Program, and

therefore he is a “qualified individual with handicaps” under the Rehabilitation Act and the

Department of Commerce Regulations. See 15 C.F.R. § 8c.3.

58. Captain Welsh currently is qualified to participate in the IFQ Program. If the

Amended Regulations are implemented and the Final Rule is effective, apart from his disability,

Plaintiff Captain Welsh will be otherwise qualified to participate in the IFQ Program.

59. The Department of Commerce Regulations govern, inter alia, the IFQ Program.

The Department of Commerce Regulations provide that “no qualified individual with handicaps

shall, on the basis of handicap, be excluded from participation in, be denied the benefits of, or

otherwise be subjected to discrimination under any program or activity conducted by the

agency.” 15 C.F.R. § 8c.30.


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15 C.F.R. § 8c.3.

61. Defendants improperly apply subsection (1) of the definition of a “qualified

individual with handicaps” in 15 C.F.R. § 8c.3 to exclude disabled individuals from hiring a

master to harvest their QS received by transfer after February 12, 2010, and therefore to exclude

disabled individuals from fully participating in and benefiting from the IFQ Program. See

79 Fed. Reg. 43685. However, the IFQ Program does not require a participant to “perform

services to achieve a level of accomplishment,” as provided in subsection (1) of the definition of

a “qualified individual with handicaps” in the Department of Commerce regulations. 15 C.F.R.

§ 8c.3. The inclusion of “qualified individuals with handicaps” such as Captain Welsh would

not result in a fundamental alteration in the nature of the IFQ Program. Because the IFQ

Program does not fall within subsection (1), Defendants’ compliance with the Department of

Commerce Regulations must be in accordance with subsection (2) of the definition of “qualified

individuals with handicaps” in 15 C.F.R. § 8c.3 which states “(2) With respect to any other


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program or activity, an individual with handicaps who meets the essential eligibility

requirements for participation in, or receipt of benefits from, that program or activity.”

62. Plaintiff Captain Welsh will be denied the full benefit of participating in the IFQ

Program solely by reason of his disability, as a result of the Final Rule and Amended

Regulations, which prohibit him from using a hired master to harvest QS received by transfer

after February 12, 2010.

63. Captain Welsh is a “qualified individual with handicaps” who, as a result of his

disabilities, is not able to be on board his vessel during fishing; accordingly, he is entitled to an

accommodation pursuant to the Rehabilitation Act by Defendants in the form of a hired master to

harvest his IFQ derived from catcher vessel QS.

64. The Final Rule and Amended Regulations facially discriminate against Captain

Welsh by categorically excluding him and other otherwise qualified individuals with a disability

from fully participating in the IFQ Program.

65. The Final Rule and Amended Regulations are discriminatory as applied to

Captain Welsh because they deny Captain Welsh the benefit of full participation in the IFQ

Program solely by reason of his disability as described above.

66. The IFQ Program is conducted by an Executive agency, namely, NMFS within

NOAA, which is a part of the Department of Commerce. The Rehabilitation Act applies to the

IFQ Program and the Amended Regulations.

67. Captain Welsh was not required to exhaust administrative remedies in this case.

Exhaustion of the compliance procedures would be futile in this case because Defendants have

already made a final decision. Moreover, judicial economy is best served by proceeding with all

claims before a district court.


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68. The Rehabilitation Act provides a more efficient and fair means to resolve this

claim than the APA. The primary issue in this claim is whether Captain Welsh is otherwise

qualified and excluded from harvesting QS received by transfer after February 12, 2010, because

of his disability – a claim that the Department of Commerce is not uniquely qualified to interpret.

Captain Welsh primarily seeks a reasonable accommodation.

69. Accommodating Captain Welsh, by allowing him to hire a master to harvest his

IFQ derived from catcher vessel QS will not be overly burdensome because it will not require

significant or fundamental alterations of the IFQ Program.

70. By promulgating the Final Rule and approving the Amended Regulations, which

have the net effect of excluding Captain Welsh and otherwise qualified individuals with a

disability from participating in the IFQ Program, Defendants violated the Rehabilitation Act.

71. By violating Captain Welsh’s and other qualified individuals’ rights under the

Rehabilitation Act, Defendants are causing substantial harm and irreparable injury for which

Captain Welsh and other qualified individuals with a disability have no adequate remedy at law.

SECOND CLAIM FOR RELIEF VIOLATIONS OF THE REHABILITATION ACT AND THE APA

(29 U.S.C. §§ 701 et seq.) (Asserted by Captain Welsh)

(In the Alternative to the First Claim for Relief)

72. Plaintiff incorporates paragraphs 1 through 55 of this Complaint as if expressly

set forth herein.

73. Plaintiff Captain Welsh suffers from a disability within the meaning of the

Rehabilitation Act. Captain Welsh is an individual with handicaps who meets the essential

eligibility requirements to participate in and receive the benefits from the IFQ Program, and


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therefore he is a “qualified individual with handicaps” under the Rehabilitation Act and

Department of Commerce Regulations. See 15 C.F.R. § 8.c.3.

74. Captain Welsh currently is qualified to participate in the IFQ Program. If the

Amended Regulations are implemented and the Final Rule is effective, apart from his disability,

Plaintiff Captain Welsh will be otherwise qualified to participate in the IFQ Program.

75. The Department of Commerce Regulations govern, inter alia, the IFQ Program.

The Department of Commerce Regulations provide that “no qualified individual with handicaps

shall, on the basis of handicap, be excluded from participation in, be denied the benefits of, or

otherwise be subjected to discrimination under any program or activity conducted by the

agency.” 15 C.F.R. § 8c.30.










15 C.F.R. § 8c.3.

77. Defendants improperly apply subsection (1) of the definition of a “qualified

individual with handicaps” in 15 C.F.R. § 8c.3 to exclude disabled individuals from hiring a

master to harvest their QS received by transfer after February 12, 2010, and therefore to exclude


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disabled individuals from fully participating in and benefiting from the IFQ Program. See

79 Fed. Reg. 43685. However, the IFQ Program does not require a participant to “perform

services to achieve a level of accomplishment,” as provided in subsection (1) of the definition of

a “qualified individual with handicaps” in the Department of Commerce regulations. 15 C.F.R.

§ 8c.3. The inclusion of “qualified individuals with handicaps” such as Captain Welsh would

not result in a fundamental alteration in the nature of the IFQ Program. Because the IFQ

Program does not fall within subsection (1), Defendants’ compliance with the Department of

Commerce Regulations must be in accordance with subsection (2) of the definition of “qualified

individuals with handicaps” in 15 C.F.R. § 8c.3 which states “(2) With respect to any other

program or activity, an individual with handicaps who meets the essential eligibility

requirements for participation in, or receipt of benefits from, that program or activity.”

78. Plaintiff Captain Welsh will be denied the full benefit of participating in the IFQ

Program solely by reason of his disability, as a result of the Final Rule and Amended

Regulations, which prohibit him from using a hired master to harvest QS received by transfer

after February 12, 2010.

79. Captain Welsh is a “qualified individuals with handicaps” who, as a result of his

disabilities, is not able to be on board his vessel during fishing; accordingly, he is entitled to an

accommodation pursuant to the Rehabilitation Act by Defendants in the form of a hired master to

harvest his IFQ derived from catcher vessel QS.

80. The Final Rule and Amended Regulations facially discriminate against Captain

Welsh by categorically excluding him and other otherwise qualified individuals with a disability

from fully participating in the IFQ Program.


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81. The Final Rule and Amended Regulations are discriminatory as applied to

Captain Welsh because they deny Captain Welsh the benefit of full participation in the IFQ

Program solely by reason of his disability as described above.

82. The IFQ Program is conducted by an Executive agency, namely, NMFS within

NOAA, which is a part of the Department of Commerce. The Rehabilitation Act applies to the

IFQ Program and the Amended Regulations.

83. Defendants are required to disapprove an FMP to the extent it is inconsistent with

other applicable law. 16 U.S.C. §§ 1854(a), (b). Defendants approved the Final Rule and

promulgated the Amended Regulations.

84. Because the Final Rule has been approved and the Amended Regulations have

been promulgated by Defendants, they are subject to judicial review. 16 U.S.C. § 1855(f);

5 U.S.C. § 704. Exhaustion of the compliance procedures would be futile in this case because

Defendants’ have already made a final decision. Furthermore, judicial economy is best served

by proceeding with all claims before a district court.

85. Accommodating Captain Welsh by allowing him to hire a master to harvest his

IFQ derived from catcher vessel QS will not be overly burdensome because it will not require

significant or fundamental alterations of the IFQ Program.

86. By promulgating the Final Rule and approving the Amended Regulations, which

have the net effect of excluding Captain Welsh and otherwise qualified individuals with a

disability from participating in the IFQ Program, Defendants’ actions and failures to act are

arbitrary and capricious, and violate the Rehabilitation Act and the APA.


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87. Defendants are causing substantial harm and irreparable injury to Captain Welsh

and other otherwise qualified individuals with a disability for which they have no adequate

remedy at law.

THIRD CLAIM FOR RELIEF VIOLATIONS OF THE MAGNUSON–STEVENS ACT, THE HALIBUT ACT, AND THE

APA – IMPERMISSIBLE RETROACTIVE APPLICATION (Asserted by All Plaintiffs)

88. Plaintiffs incorporate paragraphs 1 through 55 of this Complaint as if expressly

set forth herein.

89. Most agencies are precluded from issuing legislative rules with retroactive effect.

A statutory grant of legislative rulemaking authority will not, as a general matter, be understood

to encompass the power to promulgate retroactive rules unless that power is conveyed by

Congress in express terms. Bowen v. Georgetown, 488 U.S. 204, 208 (1988). In other words, an

agency is prohibited from issuing a retroactive legislative rule except in the event that Congress

has expressly authorized the agency to issue such retroactive legislative rules.

90. Neither the Magnuson-Stevens Act nor the Halibut Act expressly authorizes the

retroactive application of rules.

91. The effective date for the Final Rule is December 1, 2014. However, the Final

Rule contains a control date of February 12, 2010. This means that, once in effect, the Final

Rule retroactively applies to activities that have occurred since February 12, 2010.

92. Plaintiffs are initial QS recipients under the IFQ Program. Plaintiffs entered into

contracts for the sale and/or purchase of QS after February 12, 2010 and before July 28, 2014,

with the intention of relying on hired skippers to harvest the QS. Due to the retroactive

application of the Final Rule and Amended Regulations, Plaintiffs are prohibited from using


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hired skippers to fulfill the QS they acquired during the February 12, 2010 to July 28, 2014

period. As a result of Defendants’ actions, omissions, and conduct, Plaintiffs will suffer

substantial harm.

93. By including a control date in the Final Rule that pre-dates the effective date by

more than four years, and by failing to provide any notice in the Federal Register of the control

date prior to July 28, 2014, Defendants have arbitrarily and capriciously engaged in

impermissible retroactive rulemaking in violation of the Magnuson-Stevens Act, the Halibut Act,

and the APA. Defendants are causing substantial harm and irreparable injury to Plaintiffs for

which they have no adequate remedy at law.

FOURTH CLAIM FOR RELIEF VIOLATIONS OF THE UNITED STATES CONSTITUTION –

PROCEDURAL DUE PROCESS (Asserted by All Plaintiffs)

94. Plaintiffs incorporate paragraphs 1 through 55 and paragraphs 84 through 93 of

this Complaint as if expressly set forth herein.

95. The Fifth Amendment to the Constitution of the United States provides, in

pertinent part, that no person shall “be deprived of life, liberty, or property, without due process

of law.” Due process requires reasonable notice and opportunity to be heard before

governmental deprivation of a significant property interest. At a minimum, the notice must be

reasonably calculated to afford the affected persons the realistic opportunity to protect their

interests.

96. Plaintiffs have a significant, protectable property interest in QS acquired pursuant

to the IFQ Program. See Foss v. National Marine Fisheries Service, 161 F.3d 584, 588 (1998).


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97. The Final Rule contains a control date of February 12, 2010, which means that the

Final Rule retroactively applies to activities that have occurred since that date.

98. Plaintiffs are initial QS recipients under the IFQ Program. Plaintiffs entered into

contracts for the sale and/or purchase of QS after February 12, 2010 and before April 26, 2013,

with the intention of relying on hired skippers to harvest the QS. Because Plaintiffs were not

provided reasonable notice of the February 12, 2010 control date, the Final Rule unlawfully

deprives Plaintiffs of their protectable QS interests and will otherwise cause Plaintiffs substantial

harm.

99. As a result of Defendants’ actions, omissions, and conduct, Plaintiffs have been

denied due process of law in violation of the Fifth Amendment of the Constitution of the United

States.

100. Defendants’ actions and failures to act are arbitrary and capricious, violate the

United States Constitution and the APA, and are causing irreparable injury to Plaintiffs for which

there is no adequate remedy at law.

FIFTH CLAIM FOR RELIEF VIOLATIONS OF THE MAGNUSON–STEVENS ACT, THE HALIBUT ACT,

AND THE APA – ARBITRARY AND CAPRICIOUS (16 U.S.C. § 773c(b), (c); 16 U.S.C. §§ 1851(a), 1852(h), 1853(a)(1); 1853a(c); 1854(a), (b))

(Asserted by All Plaintiffs)



102. The Magnuson-Stevens Act requires that any FMP be consistent with the

Magnuson-Stevens Act. 16 U.S.C. § 1854(a) and (b).

103. The Magnuson-Stevens Act requires, inter alia, that any FMP amendment “shall

contain the conservation and management measures . . . which are necessary and appropriate for


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the conservation and management of the fishery, to prevent overfishing and rebuild overfished

stocks, and to protect, restore, and promote the long-term health and stability of the fishery. . . .”

16 U.S.C. § 1853(a)(1); see also 16 U.S.C. §§ 1852(h)(1), 1853a(c)(1)(C).

104. The Magnuson-Stevens Act further requires that any FMP amendment comply

with national standards, including that conservation and management measures shall be based

upon the best scientific information available (National Standard Two) and shall minimize

bycatch and, to the extent bycatch cannot be avoided, minimize the mortality of such bycatch

(National Standard Nine), and that if it becomes necessary to allocate or assign fishing privileges

among various United States fishermen, such allocation shall be fair and equitable and

reasonably calculated to promote conservation (National Standard Four). 16 U.S.C. § 1851(a).

105. The Halibut Act requires that regulation of halibut fishing privileges be limited to

what is necessary and “reasonably calculated to promote conservation.” 16 U.S.C. § 773c(b)(1)

and (c).

106. Defendants’ stated justification for the Final Rule is that the transition to an OOB

fleet is not occurring with sufficient rapidity. However, transitioning to an OOB fleet does not

promote conservation and will, among other things, result in increased bycatch because fish

which could be harvested if additional QS could be transferred must now be discarded as

bycatch. Moreover, Defendants fail to explain and support with substantial evidence how an

accelerated transition constitutes a “conservation and management measure,” how it is

“necessary and appropriate,” or how it is reasonably calculated to promote conservation, as

required by the Magnuson-Stevens Act and the Halibut Act. For example, there is no

identifiable standard against which the transition to an OOB fleet can be measured, as the IFQ

Program did not specify a desired time frame or milestones or standards to be met. There is also


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no rational connection between the facts found and the conclusions Defendants reached. Thus,

Defendants’ assertion that the IFQ Program is failing to meet a non-existent standard is not

supported by the necessary evidence, in violation of the Magnuson-Stevens Act and the Halibut

Act, and is arbitrary, capricious, and in excess of statutory authority, in violation of the APA.

107. Even if accelerated and forced achievement of an OOB standard were a legitimate

objective, which it is not, Defendants have conducted no analysis of how, and at what rate, the

Final Rule will increase the pace of the transition to an OOB fleet. Defendants’ explanation for

the Final Rule is justified only by speculation and surmise, unsupported by actual facts or

analysis, and therefore is likewise in violation of the APA, the Magnuson-Stevens Act, and the

Halibut Act.

108. Defendants’ purported justification also fails because they have provided no

explanation of how initial IFQ recipients, who were deemed part of the professional fishermen

community when they hired skippers to fish initial and subsequently acquired QS, now fall

outside that community when they acquire QS after February 12, 2010. Thus, as there is no

stated rational connection, supported by substantial evidence, of how these initial IFQ recipients

suddenly changed status on February 12, 2010, the Final Rule violates the APA, the Magnuson-

Stevens Act, and the Halibut Act.

109. The Final Rule also violates the Magnuson-Stevens Act, the Halibut Act,

and the APA because it retroactively terminates the existing provisions which allow fishing

family corporations to acquire QS and to hire a skipper to fish the QS. See 50 C.F.R. §

679.42(j)(1).

110. Halibut is a bycatch in the sablefish fishery and vice versa. Without the ability to

transfer QS, fishermen must discard otherwise harvestable fish as bycatch. Therefore, contrary


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to the Magnuson-Stevens Act and National Standard Nine, the Final Rule does not minimize

bycatch or, to the extent bycatch cannot be avoided, minimize the mortality of such bycatch.

111. Contrary to the Magnuson-Stevens Act and National Standard Two, Defendants

have not performed an analysis of the economic impact of the Final Rule on initial QS recipients,

or other fishery participants. Accordingly, the Final Rule is arbitrary, capricious, an abuse of

discretion, and in excess of statutory authority, in violation of the APA.


the Magnuson-Stevens Act, the National Standards, the Halibut Act, or other applicable law.

16 U.S.C. §§ 1851(a), 1854(a), (b). By promulgating the Final Rule and approving the Amended

Regulations, Defendants violated the Magnuson-Stevens Act, the Halibut Act, and the APA.

Defendants are causing substantial harm and irreparable injury to Plaintiffs for which they have

no adequate remedy at law.

SIXTH CLAIM FOR RELIEF VIOLATIONS OF NATIONAL STANDARD FOUR OF THE MAGNUSON–STEVENS

ACT, THE HALIBUT ACT, AND THE APA – FISHING PRIVILEGE ALLOCATION NOT FAIR AND EQUITABLE

(16 U.S.C. § 1851(a)(4); 16 U.S.C. § 773c(c)) (Asserted by All Plaintiffs)



114. National Standard Four of the Magnuson-Stevens Act requires that

“[c]onservation and management measures shall not discriminate between residents of different

States. If it becomes necessary to allocate or assign fishing privileges among various United

States fishermen, such allocation shall be (A) fair and equitable to all such fishermen;

(B) reasonably calculated to promote conservation; and (C) carried out in such manner that no


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COMPLAINT- 32

particular individual, corporation, or other entity acquires an excessive share of such privileges.”

16 U.S.C. § 1851(a)(4).

115. The Halibut Act likewise provides that “[i]f it becomes necessary to allocate or

assign halibut fishing privileges among various United States fishermen, such allocation shall be

fair and equitable to all such fishermen, based upon the rights and obligations in existing Federal

law, reasonably calculated to promote conservation, and carried out in such manner that no

particular individual, corporation, or other entity acquires an excessive share of the halibut

fishing privileges….” 16 U.S.C. § 773c(c).

116. The IFQ Program is required to comply with the Halibut Act and National

Standard Four of the Magnuson-Stevens Act.

117. The applicable regulations define an “allocation” as a “direct and deliberate

distribution of the opportunity to participate in a fishery among identifiable, discrete user groups

or individuals.” 50 C.F.R. § 600.325(c)(1).

118. The Final Rule and Amended Regulations constitute an “allocation.”

119. The Final Rule and Amended Regulations prohibit corporations, partnerships,

associations, and other entities, including Fairweather Fish, from harvesting QS acquired after

February 12, 2010, and from acquiring and harvesting additional QS after February 12, 2010.

Fairweather Fish and similar non-individual entities are unfairly and inequitably excluded from

full participation in the IFQ Program.

120. By refusing to permit otherwise qualified disabled individuals to hire a master to

harvest their QS received by transfer after February 12, 2010, the Final Rule and Amended

Regulations exclude otherwise qualified disabled individuals, including Captain Welsh, from

harvesting their allotted IFQ and from acquiring and harvesting additional QS. Accordingly,


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COMPLAINT- 33

Captain Welsh and similar otherwise qualified disabled individuals are unfairly and inequitably

excluded from full participation in the IFQ Program.

121. The Final Rule and Amended Regulations violate the fair and equitable

requirement of National Standard Four of the Magnuson-Stevens Act and the Halibut Act

because they impose significant disadvantages and hardships on non-individual initial IFQ

recipients without offsetting positive benefits and fail to accommodate and discriminate against

the disabled.


the National Standards or other applicable law. 16 U.S.C. §§ 1851(a), 1854(a)(1)(A), 1854(a)(3).

123. By promulgating the Final Rule and approving the Amended Regulations,

Defendants violated National Standard Four of the Magnuson-Stevens Act, the Halibut Act, and

the Administrative Procedure Act.

124. These actions and failures to act by the Defendants are arbitrary and capricious

and violate National Standard Four of the Magnuson-Stevens Act, the Halibut Act, and the

Administrative Procedure Act. Defendants are causing substantial harm and irreparable injury to

Plaintiffs for which they have no adequate remedy at law.

SEVENTH CLAIM FOR RELIEF VIOLATIONS OF NATIONAL STANDARD ONE OF THE MAGNUSON–STEVENS

ACT AND THE APA – FAILURE TO ACHIEVE OPTIMUM YIELD (16 U.S.C. §§ 1851(a)(1), 1853(a)(3))

(Asserted by All Plaintiffs)




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COMPLAINT- 34

126. National Standard One of the Magnuson-Stevens Act requires that

“[c]onservation and management measures shall prevent overfishing while achieving on a

continuing basis, the optimum yield from each fishery.…” 16 U.S.C. 1851(a)(1).

127. The Magnuson-Stevens Act defines “optimum yield” as the amount of fish which

“will provide the greatest overall benefit to the Nation, particularly with respect to food

production and recreational opportunities, and taking into account the protection of marine

ecosystems,” and “is prescribed as such on the basis of the maximum sustainable yield from the

fishery, as reduced by any relevant economic, social, or ecological factor.” 16 U.S.C.

§ 1802(33)(A)-(B).

128. The IFQ Program is required to comply with the Magnuson-Stevens Act

requirements and National Standard One.

129. Under the IFQ Program, QS are allotted by geographic area. Fishermen with QS

in one area must harvest their QS in that area and may not operate in another area without

acquiring QS in that area. In the halibut and sablefish fisheries, it is typical for QS holders to

transfer QS so that vessels can be deployed efficiently in various geographic areas. Further, if a

vessel owner has a crew member aboard who owns QS, it often happens that the combined QS of

the vessel owner and crew members exceeds the harvest cap for the vessel established under the

regulations. In these circumstances, unless the QS can be transferred, it goes unharvested.

Moreover, without the ability to transfer quota, fishermen will not be able to fully harvest halibut

and sablefish QS. Halibut is a bycatch in the sablefish fishery and vice versa. This means

fishermen unable to obtain QS via transfer must discard the bycatch which they could otherwise

retain with transferred quota.


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COMPLAINT- 35

130. The Final Rule and Amended Regulations will prevent initial QS recipients

including Fairweather Fish, Captain Welsh, and other similar entities and/or individuals from

transferring QS in order to address vessel cap, geographic, and bycatch issues, which will

prevent the achievement of optimum yield, in contravention of National Standard One.


the National Standards or other applicable law. 16 U.S.C. §§ 1851(a), 1854(a), (b).


Defendants violated National Standard One of the Magnuson-Stevens Act and the

Administrative Procedure Act.


and violate National Standard One of the Magnuson-Stevens Act and the Administrative

Procedure Act. Defendants are causing substantial harm and irreparable injury to Plaintiffs for


EIGHTH CLAIM FOR RELIEF VIOLATIONS OF NATIONAL STANDARD TEN OF THE MAGNUSON-STEVENS

ACT AND THE APA – FAILURE TO PROMOTE SAFETY OF HUMAN LIFE AT SEA (16 U.S.C. §§ 1851(a)(10), 1853(a)(3))

(Asserted by Captain Welsh)



135. National Standard Ten of the Magnuson-Stevens Act requires that “[c]onservation

and management measures shall, to the extent practicable, promote the safety of human life at

sea.” 16 U.S.C. 1851(a)(10).

136. The IFQ Program is required to comply with the Magnuson-Stevens Act

requirements and National Standard Ten.


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COMPLAINT- 36

137. By prohibiting Captain Welsh and similar otherwise qualified disabled individuals

from employing a hired master to harvest their IFQ received by transfer after February 12, 2010,

the Final Rule and Amended Regulations unlawfully fail to promote the safety of human life at

sea. For these disabled individuals to harvest their QS received after February 12, 2010, the

Final Rule and Amended Regulations require that they be on board their vessel in blatant

disregard of National Standard Ten.


the National Standards and other applicable law. 16 U.S.C. §§ 1851(a), 1854(a), (b).


Defendants violated National Standard Ten of the Magnuson-Stevens Act and the Administrative

Procedure Act.


and violate National Standard Ten of the Magnuson-Stevens Act and the Administrative

Procedure Act. Defendants are causing substantial harm and irreparable injury to Plaintiffs for


NINTH CLAIM FOR RELIEF VIOLATIONS OF THE MAGNUSON–STEVENS ACT AND THE APA –

FAILURE TO COMPLY WITH APPLICABLE LAW (16 U.S.C. §§ 1854(a), (b)) (Asserted by All Plaintiffs)



142. Pursuant to the Magnuson-Stevens Act, the Final Rule and Amended Regulations

are required to be consistent with applicable law. 16 U.S.C. § 1854(a), (b).


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COMPLAINT- 37

143. For each of the reasons set forth above, and in each of the above outlined claims,

the Final Rule and Amended Regulations are inconsistent with applicable law, particularly the

Rehabilitation Act and the United States Constitution, and therefore violate the Magnuson-

Stevens Act.

144. Defendants’ decision to promulgate the Final Rule and approve the Amended

Regulations is arbitrary, capricious, an abuse of discretion, and/or otherwise not in accordance

with law in violation of the APA.

VII. PRAYER FOR RELIEF

WHEREFORE, Plaintiffs respectfully request that the Court:

a. With respect to Plaintiff Captain Welsh, declare that he is entitled to hire a

master to harvest IFQ derived from catcher vessel QS received by transfer after February 12,

2010;

b. Declare that Defendants have violated the Rehabilitation Act as described

above by excluding otherwise qualified individuals with a disability from participating in the

IFQ Program with respect to the Final Rule and Amended Regulations;

c. Declare that Defendants have violated the Rehabilitation Act and the APA

as described above by excluding otherwise qualified individuals with a disability from

participating in the IFQ Program with respect to the Final Rule and Amended Regulations;

d. Declare that Defendants have violated the Magnuson-Stevens Act, the

Halibut Act, and the APA in the Final Rule and Amended Regulations based on their

impermissible retroactive application as described above;


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COMPLAINT- 38

e. Declare that Defendants have violated the United States Constitution and

the APA by failing to comply with Procedural Due Process requirements when promulgating the

Final Rule as described above;

f. Declare that Defendants have violated the Magnuson-Stevens Act,

including National Standard Two, the Halibut Act, and the APA as described above by

employing an incorrect interpretation of the Magnuson-Stevens Act and the Halibut Act that

foreclosed the required analysis and consideration of issues and alternatives, and otherwise failed

to comply with applicable law, with respect to the Final Rule and Amended Regulations;

g. Declare that Defendants have violated National Standard Nine of the

Magnuson-Stevens Act as described above by failing to minimize bycatch with respect to the

Final Rule and Amended Regulations;

h. Declare that Defendants have violated National Standard Four of the

Magnuson-Stevens Act, the Halibut Act, and the APA as described above by allocating an unfair

and inequitable fishing privilege in the Final Rule and Amended Regulations;

i. Declare that Defendants have violated National Standard One of the

Magnuson-Stevens Act as described above by failing to achieve optimum yield with respect to

the Final Rule and Amended Regulations;

j. Declare that Defendants have violated National Standard Ten of the

Magnuson-Stevens Act as described above by failing to promote the safety of human life at sea.

k. Declare the Defendants have violated the Magnuson-Stevens Act and the

APA, as described above, by failing to comply with applicable law;


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COMPLAINT- 39

l. Enjoin Defendants from implementing the Amended Regulations and

making effective the Final Rule in violation of the Rehabilitation Act, the Halibut Act, the

United States Constitution, and the APA;

m. Vacate the Final Rule implementing the Amended Regulations;

n. Remand the Final Rule and the Amended Regulations to NMFS for

reconsideration and compliance with the Rehabilitation Act, the Magnuson-Stevens Act, the

Halibut Act, the United States Constitution, and the APA;

o. Maintain jurisdiction over this action until Defendants are in compliance

with the Rehabilitation Act, the Magnuson-Stevens Act, the Halibut Act, the United States

Constitution, the APA, and every order of this Court;

p. Award Plaintiffs their costs of litigation, including reasonable attorney and

expert witness fees; and

q. Grant Plaintiffs other such relief as this Court deems proper and just.

RESPECTFULLY SUBMITTED this 30th day of October, 2014.

/s/ James A. Smith, Jr. James A. Smith, Jr., WSBA #5444

/s/ Geoffrey P. Knudsen Geoffrey P. Knudsen, WSBA #1324

/s/ Julia K. Doyle Julia K. Doyle, WSBA #43993 SMITH & HENNESSEY PLLC 316 Occidental Avenue South, Suite 500 Seattle WA 98104 Telephone: (206) 292-1770 Facsimile: (206) 292-1790 [email protected] [email protected] [email protected]


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COMPLAINT- 40

/s/ George J. Mannina, Jr. George J. Mannina, Jr., Pro Hac Vice

/s/ Veronica M. Gray Veronica M. Gray, Pro Hac Vice

/s/ Jennifer R. Darling Jennifer R. Darling, Pro Hac Vice NOSSAMAN LLP 1666 K Street, N.W., Suite 500 Washington, D.C. 20006 Telephone: (202) 887-1400 Facsimile: (202) 366-4215 [email protected] [email protected] [email protected] Attorneys for Plaintiffs


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