Sep 26th, 2024

Trade Updates for Week of September 11, 2024


UNITED STATES COURT OF INTERNATIONAL TRADE

Slip Op. 24-101

Before the Court in Sea Shepherd New Zealand, et. al. v. United States, Slip Op. 24-101 (September 11, 2024) was a joint stipulation of dismissal with prejudice under USCIT Rule 41 filed by the parties. This action relates to an earlier set of cases about the critically endangered Maui dolphin which is endemic to the waters around New Zealand’s North Island. See Sea Shepherd N.Z. v. United States (“Sea Shepherd I”), 44 CIT __, 469 F. Supp. 3d 1330 (2020), ECF No. 38; Sea Shepherd N.Z. v. United States (“Sea Shepherd II”), 46 CIT __, 606 F. Supp. 3d 1286 (2022), ECF No. 108; Sea Shepherd N.Z. v. United States (“Sea Shepherd III”), 47 CIT __, 611 F. Supp. 3d 1406 (2023), ECF No. 131; Sea Shepherd N.Z. v. United States (“Sea Shepherd IV”), 47 CIT __, 639 F. Supp. 3d 1367 (2023), ECF No. 136; Sea Shepherd N.Z. v. United States (“Sea Shepherd V”), 48 CIT __, 693 F. Supp. 3d 1364 (2024), ECF No. 153.

In 2020, Sea Shepherd New Zealand and Sea Shepherd Conservation Society filed a lawsuit arguing that bycatch from gillnet and trawl fisheries was causing a decline in the Māui dolphin population. They sought a U.S. ban on importing certain New Zealand fish products under the Marine Mammal Protection Act (MMPA). On the other hand, the U.S. and New Zealand governments disputed this claim, asserting that New Zealand’s standards complied with the MMPA and thus no import ban was necessary. With only 43 remaining dolphins by recent estimates,1 the Mui dolphin is on the brink of extinction, in 2022 the Court of International Trade initially imposed a preliminary injunction banning certain fish imports from New Zealand into the United States. However, on January 2024, the Court lifted the injunction after the U.S. National Oceanic and Atmospheric Administration (NOAA) confirmed that New Zealand’s measures to reduce Māui dolphin bycatch met the Marine Mammal Protection Act (MMPA) requirements for the period from February 21, 2024, to December 31, 2025. Thus, prior to the instant action, the court granted New Zealand’s request to lift the injunction. The Court noted that the U.S. government and respective agencies agreed to the court’s lifting of the injunction and plaintiffs did not oppose it. Upon the joint filing of a joint Notice of Dismissal, the Court dismissed the case but retained jurisdiction to enforce fees and costs.

The MMPA, 16 U.S.C. § 1371(a), requires the Secretary of the Treasury to ban the “importation of commercial fish or products from fish which have been caught with commercial fishing technology which results in the incidental kill or incidental serious injury of ocean mammals in excess of United States standards.” See id. § 1371(a)(2). To determine whether such fish or fish products result in harm in excess of United States standards, the NOAA Imports Regulation requires foreign harvesting nations to secure “comparability findings” for their fisheries importing fish and fish products into the United States. See 50 C.F.R. §§216.24(h)(1)(i), 216.3. Any subject fish or fish product harvested in a fishery for which a valid comparability finding is not in effect is unlawful to import. See id. § 216.24(h)(1)(ii)(A). In February 2019, Plaintiffs submitted a formal petition to the U.S. Departments of Homeland Security, Treasury, and Commerce requesting that those agencies invoke their rulemaking authority arising out of the MMPA to ban the importation of fish and fish products originating from New Zealand fisheries in the Maui dolphin’s range that employ either gill nets or trawls. See Pls.’ Initial Maui Dolphin Pet. at 3, 12 (Feb. 6, 2019), AR0001 (“Initial Petition”). Plaintiffs urged immediate action because, “[c]ontrary to the MMPA, the United States, through the actions and omissions of the Agencies, currently allows the importation of fish and fish products from New Zealand fisheries that kill and injure critically endangered Maui dolphins in excess of United States standards.” Id. at 3–4. In July 2019, NOAA rejected Plaintiffs’ Initial Petition, determining that New Zealand’s TMP was comparable to U.S. standards. See Notification of the Rejection, 84 Fed. Reg. 32853 (Dep’t Com. July 10, 2019), AR5426.

The initial complaint filed by Plaintiffs in May 2020 asserted two claims challenging NOAA’s denial: (1) that NOAA unlawfully withheld or unreasonably delayed agency action in violation of the Administrative Procedure Act (“APA”), 5 U.S.C. § 706(1), by failing to ban the import of commercial fish and products from fish caught using gillnet and trawls in the Maui dolphin’s range in excess of U.S. standards; and (2) that NOAA’s denial of Plaintiffs’ petition for emergency rulemaking was arbitrary, capricious, an abuse of discretion, and otherwise not in accordance with law under the APA, 5 U.S.C. § 706(2)(A). See Original Compl. ¶¶ 84–88, 89–94.

In November 2020, Plaintiffs filed a Supplemental Complaint, which restated the initial two claims and added a third claim that NOAA’s First Comparability Findings were arbitrary, capricious, an abuse of discretion, and otherwise not in accordance with law under the APA, 5 U.S.C. § 706(2)(A). See Suppl. Compl. ¶¶ 117–121.7 Plaintiffs later filed a Renewed Motion for Preliminary Injunction in December 2020, requesting an embargo. See Pls.’ Ren. PI Mot. The United States and New Zealand governments moved to dismiss Plaintiffs’ first claim. Separately, New Zealand submitted an application to NOAA in November 2021, requesting new comparability findings for all of its fisheries—including the two fisheries at issue in this case—for the period following January 1, 2023. In November 2022, the Court granted Plaintiffs’ motion and issued a preliminary injunction banning the importation of fish and fish products deriving from nine fish species caught in New Zealand’s West Coast North Island inshore trawl and set net fisheries, unless affirmatively identified as having been caught with a gear type other than gillnets or trawls. See Sea Shepherd II, 606 F. Supp. 3d at 1331; see also Order, Nov. 28, 2022, ECF No. 109. The Court had concluded that Plaintiffs were likely to succeed on the merits of their second and third claims, that irreparable harm to the Maui dolphin was likely absent an injunction, and that the balance of hardships weighed in Plaintiffs’ favor. Id. As for the first claim, the court granted the United States’s and New Zealand’s motions to dismiss for failure to state a claim arising under 5 U.S.C. § 706(1). See id. at 1309–10. The Court noted that NOAA’s denial of the Initial Petition was not a failure to act under 5 U.S.C. § 706(1), as Plaintiffs argued, but rather an affirmative agency action of denial that was more properly challenged by Plaintiffs’ second claim under 5 U.S.C. § 706(2). See id. In December 2022, New Zealand moved to modify the preliminary injunction to allow for a grace period to implement a traceability system. See Sea Shepherd III, 611 F. Supp. 3d at 1408. However, the Court denied this motion because New Zealand had not established a change of circumstances that would make the continuation of the original injunction inequitable. Id. at 1410. Then, given the expiration of the First Comparability Findings in January 2023, the United States moved to dismiss as moot Plaintiffs’ third claim but the court denied that motion, concluding that aspects of Plaintiffs’ request for declaratory relief under the third claim remained live. See Sea Shepherd IV, 639 F. Supp. 3d at 1371. Following that decision, the parties jointly moved to stay litigation in the case stating their view that “NMFS’ decision on the pending comparability applications may obviate, in whole or in part, the need for continued litigation in this action.” See Joint Mot. for Stay of Litig., July 7, 2023, ECF No. 137.

NMFS was expected to issue the pending comparability findings relevant to this case by November 30, 2023. The NMFS later extended the MMPA exemption period by two years to end on December 31, 2025, meaning that NMFS had until November 30, 2025, to issue the pending comparability findings relevant to this case. See Modification of Deadlines Under the Fish and Fish Product Import Provisions of the Marine Mammal Protection Act, 88 Fed. Reg. 80193, 80194 (Dep’t Com. Nov. 17, 2023); 50 C.F.R. § 216.24(h)(6)(ii).

On January 24, 2024, NOAA published a new set of comparability findings covering the two fisheries at issue in this case. See Implementation of Fish and Fish Product Import Provisions of the Marine Mammal Protection Act—Notification of Issuance of Comparability Findings, 89 Fed. Reg. 4595 (Dep’t Com. Jan. 24, 2024) (“Second Comparability Findings”). NOAA stated that it had reconsidered the First Comparability Findings, “based on supplemental information provided by Plaintiffs and New Zealand since that time,” and again concluded that New Zealand’s revised TMP of October 2020 was comparable in effectiveness to U.S. standards. Id. at 4596–97. NOAA noted that since the 2020–2021 fishing year, “fishing effort has been reduced by 71 percent for the trawl fleet and 97 percent for the set net fleet,” and “50 percent of trawl effort and 90 percent of set net effort were monitored.” Id. at 4596. Ultimately, NOAA concluded, New Zealand’s TMP “will result in Maui dolphin bycatch below PBR and concentrate the fisheries restrictions in the areas with the greatest risk, specifically those areas where fishing activities overlap with the Maui dolphin population.” Id. at 4597. The Second Comparability Findings are valid until December 31, 2025.

New Zealand moved to dissolve the preliminary injunction in March 2024. The court concluded that NOAA’s issuance of the Second Comparability Findings constituted a “significant change in [the] factual conditions and law” underlying the preliminary injunction and dissolved the injunction. Sea Shepherd V, 693 F. Supp. 3d at 1367. Thereafter, Plaintiffs moved for extensions of the stay, with the consent of the United States and New Zealand, to negotiate the case’s stipulated dismissal and resolve any claims for attorneys’ fees and costs. See Pls.’ Status Report & Consent Mot. to Extend the Stay ¶ 1, July 22, 2024, ECF No. 160, which the Court has granted.

Pursuant to USCIT Rule 41, on August 23, 2024, the parties filed a joint stipulation of dismissal with prejudice with a filed a copy of their settlement agreement. The Court decided that under the terms of the stipulated dismissal and the settlement agreement, this action will be dismissed with prejudice and the United States will pay to Plaintiffs $375,000.00 in attorneys’ fees and costs, pursuant to the Equal Access to Justice Act, 28 U.S.C. § 2412(d). See id. Notice of Dismissal.