Supreme Court Definitively Rejects Lower Court Rulings in Aquarium Case

posted in: October 2017 | 0

Scathing. That may be the single best word to describe the Hawai‘i Supreme Court’s characterization of arguments put forward by the Department of Land and Natural Resources in defense of the department’s position that the commercial collection of aquarium fish does not require it to undertake an environmental review. Nor did the court have much positive to say about the lower court rulings that agreed with the department.

The high court’s unanimous ruling, published on September 6, overturns the decisions of the 1st Circuit Court and Intermediate Court of Appeals in a case that was first filed five years ago. In a 73-page opinion, it found unequivocally that the DLNR’s system of permitting aquarium fish collectors meets the definition of an action that required compliance with the Hawai‘i Environmental Policy Act (HEPA), Chapter 343 of Hawai‘i Revised Statutes.

In remanding the case back to the Circuit Court, the justices instructed it “to grant petitioners’ summary judgment motion to the extent that petitioners are requesting declaratory relief and a prohibitory injunction as to commercial aquarium collection permits issued under [Hawai‘i statute] and DLNR’s administrative rules.” In other words, the lower court must now enjoin all commercial aquarium collection.

Also at issue in the lawsuit was the question of whether recreational aquarium collection permits would need to undergo the same level of review. On that question, the Supreme Court punted, tossing it back to the Circuit Court to determine in further proceedings “consistent with this opinion.”

The Players

The challenge to aquarium fish collection was brought on October 24, 2012. Petitioners were four individuals (Rene Umberger, Mike Nakachi, Ka‘imi Kaupiko, and Willie Kaupiko), and three nonprofit organizations (the Conservation Council for Hawai‘i, the Humane Society of the United States, and the Center for Biological Diversity). Representing them were Paul Achitoff and Summer Kupau-Odo of the environmental law firm Earthjustice.

Under the DLNR permit system, commercial aquarium collectors are allowed to take an unlimited number of marine animals each year. The only requirement imposed on them by the DLNR is that they show they have the means to keep the collected animals alive and pay a nominal fee. Recreational permit holders may take up to 1,825 animals a year.

The DLNR had established a web-based system for issuance of collection permits that removed any discretion from the permit-granting process, as Alton Miyasaka, of the DLNR’s Division of Aquatic Resources, described in court filings. “Miyasaka averred that ‘[a]nyone who applies for a permit … and who goes through the [online filing] process receives a permit,’” the court noted. The department “does not have and does not exercise discretion with respect to the permits,” the court quoted Miyasaka as saying.

And because no discretion was involved in issuing the permits, the DLNR argued, there was no agency action initiated by an applicant that required agency approval. Without that “applicant action,” the state said, there was no trigger for environmental review.

The Circuit Court agreed and granted the state’s motion for summary judgment.

The lower court judgment was entered in June 2013 and less than a month later, an appeal had been filed with the Intermediate Court of Appeals.

The ICA Decision

According to the decision reached by the three judges of the Intermediate Court of Appeals, the dispute before it “concerns whether DLNR must require each applicant for an aquarium fish permit to comply with the environmental review procedures set forth [in Chapter 343] before DLNR issues a permit.”

By describing it in this way, the onus for preparing an environmental disclosure document fell not to the department, but to the individual applicant – a prospect that, the court argued, was unrealistic.

In its analysis, the ICA looked at what constituted an “action” under Chapter 343, which defines action as “any program or project to be initiated by any agency or applicant.”

“The issue of whether aquarium collection pursuant to a DLNR-issued permit constitutes a program or project is a question of statutory interpretation,” the ICA found, noting that the law itself did not define these two terms. The ICA went on to review a number of past Supreme Court cases involving questions of the applicability of Chapter 343 to various developments and undertakings around the state.

“The projects or programs described in these cases … exemplify the essential nature of HEPA’s intended reach and … the defini- tion of ‘action’ as ‘any program or project’ – as opposed to, for example, ‘any activity whatsoever’ – reflects that not every level of regulated activity is meant to be swept into HEPA’s reach,” the ICA found. These cases identified projects, it continued, that “stand in stark contrast to the activity of aquarium fish collection … which includes a parent netting one or two fish from a stream for his or her child’s fish tank, as well as larger scale commercial operations. It would be unprecedented to apply HEPA to require individual Hawai‘i citizens to undertake the EA process for such an activity.”

In any event, the ICA continued, a “panoply of other regulatory tools” exists to regulate the taking of aquarium fish. The DLNR, for example, could impose limits on the length and height of small mesh nets and bag limits, could ban the take of certain species or set size limits. “Hawai‘i law provides DLNR with numerous powers and duties to manage aquatic life and resources, comprehensively and systemically, rather than based on a separate environmental review for each fishing permit or license,” the ICA wrote.

One key point of the DLNR’s argument was, however, clearly rejected by the ICA: its claim that, because it had automated the award of aquarium collection permits through an online process, it no longer had any discretion over them.

“[B]y its plain language,” the ICA wrote, Section 188-31 of Hawai‘i Revised Statutes “gives DLNR discretionary authority over whether to approve a[n] aquarium fish permit.” The online form “is simply the means by which DLNR has determined to exercise its discretion…. Accordingly, we reject DLNR’s argument that a lack of discretionary approval provides a separate ground for denying appellants’ requested relief.”

The High Court

Undaunted, the plaintiffs appealed the ICA decision to the state Supreme Court. In its order last month, the high court was unsparing in its criticism of the analyses provided by the lower courts.

It took exception to the determination that the action was not a “program” or “project” and rejected the ICA’s statement that aquarium collection “includes a parent netting one or two fish from a stream … as well as larger scale commercial operations.”

The “defined activity authorized under an aquarium collection permit,” the justices found, involved at least four components: “the extraction of an unlimited number of fish or other aquatic life for profit or other gains … or of 1,825 fish or other aquatic life for non-commercial purposes (in the case of recreational aquarium collection);” doing so by using “fine meshed nets or traps;” by persons who can “satisfy DLNR that they possess facilities” to keep the aquatic life alive; and with the intention of holding the captured animals as pets, as subjects of scientific study, for public exhibition, or for sale for these purposes.

As such, the actions allowed under the permits and the administrative scheme adopted by the DLNR “encompass activity that qualifies as a ‘program’ or ‘project,’” the Supreme Court found. “The activity is a ‘specific plan’ or ‘a planned undertaking’ – and, therefore, a ‘project’—because it involves the systematic and deliberate extraction of aquatic life using procedures, equipment, facilities, and techniques authorized or required by [statute] and related administrative rules…”

The justices took note of the ICA’s effort to determine whether aquarium collection was subject to HEPA review by comparing it to other activities at issue in previous court cases involving HEPA. They faulted the ICA for doing so, noting that “the class of activities and courses of action that HEPA covers is broad so as to successfully effectuate the intent and purpose of the statutory scheme. Additionally, there has been no HEPA case in which this court determined whether an activity is a HEPA ‘action’ by evaluating its similarity to the challenged activities in other HEPA cases. Doing so would unreasonably delimit HEPA’s application in a manner inconsistent with its purpose.”

The Supreme Court similarly had few kind words for the ICA’s reductio ad absurdum argument that if it found commercial aquarium collection was subject to HEPA, then parents collecting one or two fish for a home aquarium would have to do a HEPA analysis as well. “This analysis is flawed because the properly defined activity for the purposes of the HEPA analysis must encompass the outer limits of what the permits allow and not only the most restrictive hypothetical manner in which the permits may be used,” the justices wrote. In any event, “a parent netting one or two fish for a home aquarium may not even be within the ambit of [Hawai‘i Revised Statutes Section 188-31] because aquarium collection permits are required only if the applicant intends ‘to use fine meshed traps, or fine meshed nets other than throw nets….” Thus, the netting of one or two fish wouldn’t even qualify as aquarium collection under the DLNR’s rules, the court noted.

And if that didn’t put paid to the matter, the justices added this: “Lastly, the situation postulated by the ICA – a parent netting one or two fish or other aquatic life for recreational purposes – is not present in this case and DLNR’s own evidence in fact showed that, from 1999 to 2010, millions of aquatic life were harvested under aquarium collection permits” issued by the department. (Finally, in a footnote, they wrote: “Petitioners also emphasize in their application for writ of certiorari that this scenario is not part of the record in this case.”)

As to the ICA’s statement that the DLNR had other means apart from Chapter 343 compliance to regulate aquarium collection, the Supreme Court justices noted that this contradicts positions staked out by the ICA itself in other cases: “As the ICA itself recognized in ‘Ohana Pale Ke Ao v. Board of Agriculture, … where HEPA overlaps and is consistent with another chapter of the HRS, both would be given effect.”

If other laws and rules that appear to bear upon the environmental effects of an activity “would exclude the activity from HEPA’s purview,” the justices went on to say, “then this would frustrate HEPA’s purpose of requiring agencies to appropriately consider environmental concerns in their decision-making process.”

“In other words,” they continued, “under the ICA’s analysis, an agency would be able to bypass the protections provided through HEPA by promulgating administrative rules that appear to address or bear upon the possible environmental effects of an activity that the agency regulates without actually engaging in the informed and deliberate decision-making process that HEPA requires.”

The justices went on to find that aquarium collection involves the use of state lands and the use of the state Conservation District, pulling two of the triggers for Chapter 343 analysis.

Finally, they analyzed whether the activity could conceivably be considered exempt. To be exempt, an activity must be determined to “probably have minimal or no significant effects on the environment,” they wrote, quoting the Environmental Council’s administrative rules. “The most relevant exemption – ‘[m]inor alterations in the conditions of land, water, or vegetation’ – … has no application because a permit for extraction of an unlimited number of aquatic life cannot be said to constitute only a ‘[m]inor alteration’ in the condition of state waters and submerged lands.”

The determination as to the potential exemption of recreational collection was not as clear in the justices’ opinion, and so this was remanded to the Circuit Court, “using the analytical framework discussed herein.”

— Patricia Tummons

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