Opinion
Civil Action No. 15–cv–00920–CMA
05-02-2016
People for the Ethical Treatment of Animals, Inc., Plaintiff, v. United States Department of Agriculture, and Tom Vilsack, in his official capacity as Secretary of the United States Department of Agriculture, Defendants.
Delcianna Joy Winders, Jenni Rebecca James, Foundation to Support Animal Protection, Washington, DC, for Plaintiff. Juan G. Villasenor, U.S. Attorney's Office, Denver, CO, for Defendants.
Delcianna Joy Winders, Jenni Rebecca James, Foundation to Support Animal Protection, Washington, DC, for Plaintiff.
Juan G. Villasenor, U.S. Attorney's Office, Denver, CO, for Defendants.
OPINION AND ORDER AFFIRMING AGENCY DETERMINATION
CHRISTINE M. ARGUELLO, United States District Judge
This matter comes before the Court for review of agency action pursuant to the Administrative Procedure Act ("APA"), 5 U.S.C. § 701 et seq. The Court has reviewed the Administrative Record (Doc. # 36, as supplemented by Doc. # # 37, 43, 46), the Plaintiffs' opening brief (Doc. # 47), the Defendant's response brief (Doc. # 51), and the Plaintiffs' reply brief (Doc. # 52).
I. BACKGROUND
On April 30, 2015, Plaintiff People for the Ethical Treatment of Animals, Inc. ("PETA") filed its Complaint (Doc. # 1) seeking judicial review of the United States Department of Agriculture's ("USDA") September 4, 2014 decision to issue a wild animal exhibitor's license to the Louisiana Purchase Gardens and Zoo ("LPZ"), owned by and located in the City of Monroe, Louisiana. (AR at 76.)
In its briefs, PETA cites the license issue date as Sept. 3, 2014. The date of issuance according to the USDA was Sept. 4, 2014, with the license expiring on Sept. 3, 2015. This Court accepts the USDA's date and refers to the issue date as Sept. 4 throughout, even when citing to PETA's briefs.
Congress directs the Secretary of Agriculture ("Secretary") to issue exhibitor licenses under the Animal Welfare Act ("AWA"), 7 U.S.C. §§ 2133. The Secretary has promulgated standards of compliance to govern, among other things, when the issuance of a zoo license is proper in 9 C.F.R. Ch. I, Subch. A—Animal Welfare ("Title 9"). In accordance with Title 9, the USDA issues exhibitor licenses through its subsidiary agency the Animal and Plant Health Inspection Service ("APHIS").
Before the licensing at issue in this case, LPZ held AWA license 72–C–0148, which expired May 6, 2014. (Doc. # 51 at 3; AR at 233, 235.) On June 27, 2014, the City of Monroe, d/b/a LPZ, applied for a new license. (AR at 76.) Over the following two months, APHIS conducted two pre-license inspections of LPZ. (AR at 86–89.) LPZ failed the first pre-license inspection on July 8, 2014. (AR at 86–88). In that inspection report, APHIS noted six areas of noncompliance with the Title 9 licensure standards, specifically §§ 2.131(c)(1), 3.75(a), 3.125(a), 3.125(c), 3.127(d), and 3.131. (Id. ) The inspector advised LPZ of the "availability of two additional inspections if needed to meet 100% compliance of minimal standards or 90 days whichever occurs first." (AR at 88.) If LPZ did not meet 100% compliance within two inspections or 90 days, the zoo would have to wait six months to re-apply for a new license. (Id. ) APHIS conducted and LPZ passed a second inspection on August 27, 2014. (AR at 89.) APHIS found "no noncompliance" in that inspection. (Id. ) Accordingly, on Sept. 4, 2014, APHIS issued LPZ a Class C exhibitor license numbered 74–C–0223. (AR at 75.) APHIS renewed that license on Sept. 3, 2015. (AR at 77–78.)
II. ISSUES
PETA contends that the USDA's decision to issue LPZ a new exhibitor license in September 2014 violated 7 U.S.C. § 2133 of the AWA, in that the USDA's decision making process was arbitrary, capricious, or contrary to law. Section 2133 provides:
The Secretary [of Agriculture of the United States] shall issue licenses to dealers and exhibitors upon application therefor in such form and manner as he may prescribe and upon payment of such fee established pursuant to 2153 of this title: Provided, That no such license shall be issued until the dealer or exhibitor shall have demonstrated that his facilities comply with the standards promulgated by the Secretary pursuant to section 2143 of this title....
7 U.S.C. § 2133 (2012). PETA alleges that, at the time the USDA issued LPZ its new exhibitor license, the zoo was not in compliance with three standards promulgated by the Secretary. Specifically, the zoo (1) housed nonhuman primates in isolation without justification in violation of 9 C.F.R. § 3.81, (2) housed animals in facilities with inadequate fences in violation of 9 C.F.R. § 3.127(d), and (3) actively exhibited animals without a valid license in violation of 9 C.F.R. § 2.1. (Doc. # 47 at 2–3.) To support these contentions, PETA points to evidence in the administrative record ("AR")—primarily letters, photographs, and video footage PETA submitted to the USDA between May 2014 and May 2015, with some items dating back to 2010.
The USDA responds with three arguments. First, the USDA contends PETA's claim is moot because the USDA renewed LPZ's license while this litigation was pending, superseding its licensing decision with a new final agency action subject to "materially different regulatory standards." (Doc. # 51 at 10.) Second, the USDA contends its decision to issue LPZ a license based solely on the agency's own pre-license inspection reports was a permissible interpretation of the AWA and, as such, is entitled to Chevron deference. Finally, the USDA argues that, even if the case is not moot, its decision to issue LPZ an exhibitor license was not arbitrary and capricious because it is supported by substantial evidence—namely the second pre-license inspection report finding "no noncompliance." Further, the USDA argues its decision is entitled to a presumption of regularity and PETA has failed to present clear evidence LPZ was not in compliance in order to overcome that presumption.
PETA seeks declaratory and injunctive relief under Section 702 of the APA and asks this Court to set aside the USDA's licensing decision as "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law" within the meaning of the APA. Administrative Procedure Act, 5 U.S.C. § 706(2)(A) (2012).
III. JURISDICTION AND VENUE
The APA itself "does not afford an implied grant of subject-matter jurisdiction" to review federal administrative action, but this Court can exercise federal question jurisdiction to review administrative action under 28 U.S.C. § 1331. Califano v. Sanders, 430 U.S. 99, 105, 97 S.Ct. 980, 51 L.Ed.2d 192 (1977) ("The obvious effect of [Congress amending 28 U.S.C. § 1331 to no longer require any specified amount in controversy] is to confer jurisdiction on federal courts to review agency action, regardless of whether the APA of its own force may serve as a jurisdictional predicate."). Venue is also proper pursuant to 28 U.S.C. § 1391(e) because the events giving rise to the claims took place in this district.
A. Subject Matter Jurisdiction
Before discussing the merits of the USDA's decision to issue a license to LPZ, this Court must address two threshold issues regarding this Court's subject matter jurisdiction to review federal administrative actions. First, not all decisions of administrative agencies are judicially reviewable. 5 U.S.C § 701(a)(1)–(2). Second, "[w]e have no subject-matter jurisdiction if a case is moot." Rio Grande Silvery Minnow v. Bureau of Reclamation, 601 F.3d 1096, 1109 (10th Cir.2010). The claims in the instant case are neither statutorily precluded from judicial review nor moot.
1) Judicial Reviewability Under the APA
Because the Animal Welfare Act does not provide for a private right of action, Plaintiff files this suit under the general cause of action provided for in section 702 of the APA. (Doc. # 1.) That section provides a "person suffering legal wrong because of agency action, or adversely affected or aggrieved by agency action within the meaning of a relevant statute, is entitled to judicial review thereof." 5 U.S.C § 702. This provision does not apply, however, where "statutes preclude judicial review" or the challenged agency action is "committed to agency discretion by law." 5 U.S.C. § 701(a). Outside these two narrow exceptions, "[a]ll agency actions are presumed reviewable under the APA." Wyoming v. U.S. Dep't of Agric., 661 F.3d 1209, 1242 (10th Cir.2011).
The Supreme Court has held that a person has standing to obtain judicial review of federal agency action under § 702 only when they have alleged that the challenged action has caused an "injury in fact." Sierra Club v. Morton, 405 U.S. 727, 733, 92 S.Ct. 1361, 31 L.Ed.2d 636 (1972) ; see also Lujan v. Nat'l Wildlife Fed'n, 497 U.S. 871, 882–83, 110 S.Ct. 3177, 111 L.Ed.2d 695, (1990). The record is unclear as to whether PETA has sustained a constitutionally sufficient injury in fact. The Government, however, failed to assert lack of standing on the part of PETA and, rather than delay the matter further by requiring the parties to provide additional briefing, for purposes of issuing a ruling on the merits, the Court will assume arguendo that the "injury in fact" alleged by PETA is sufficient to afford standing in this case. However, nothing in this order should be interpreted as a finding that PETA has established standing to bring this action.
Where 5 U.S.C. § 701(a)(2) applies, judicial review is precluded. Courts differ in their interpretation of why this is true—whether implication of § 701(a)(2) destroys subject matter jurisdiction or renders the case nonjusticiable notwithstanding subject matter jurisdiction. The Tenth Circuit has not explained its reasoning. Compare Animal Legal Def. Fund v. U.S. Dep't of Agric., 789 F.3d 1206, 1214 (11th Cir.2015) ("Whether an agency action is reviewable under § 701(a)(2) is a matter of subject matter jurisdiction."), with Sierra Club v. Jackson, 648 F.3d 848, 853–54 (D.C.Cir.2011) (holding decisions excluded from judicial review under § 701(a)(2) are not justiciable because relief cannot be granted, but courts still retain subject matter jurisdiction over such controversies), and Wyoming v. U.S. Dep't of Agric., 661 F.3d 1209, 1242 (10th Cir.2011) (finding that § 702(a)(2) simply "precludes review" when it applies).
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The agency action Plaintiff challenges in this case is the USDA's issuance of an animal exhibition license to LPZ pursuant to the Animal Welfare Act ("AWA"), 7 U.S.C. §§ 2131 –2159. The AWA does not, in any of its provisions, preclude judicial review such that section 701(a)(1) should apply. Nor does the AWA commit complete discretion to the USDA such that section 701(a)(2) should apply. The AWA is not "drawn so that a court would have no meaningful standard against which to judge the agency's exercise of discretion." Wyoming, 661 F.3d at 1242 (citation omitted). The AWA provides guidelines for the issuance of exhibitor licenses in 7 U.S.C. § 2133 :
The Secretary shall issue licenses to dealers and exhibitors upon application therefor in such form and manner as he may prescribe and upon payment of such fee established pursuant to 2153 of this title: Provided, That no such license shall be issued until the dealer or exhibitor shall have demonstrated that his facilities comply with the standards promulgated by the Secretary pursuant to section 2143 of this title....
Though the AWA provides the Secretary with significant discretion, the Secretary may only grant licenses to dealers or exhibitors that comply with promulgated standards. Because these guidelines give this Court "law to apply" to the USDA's licensing decision, section 701(a)(2) also does not preclude judicial review. City of Colorado Springs v. Solis, 589 F.3d 1121, 1130 (10th Cir.2009) (quoting Citizens to Pres. Overton Park, Inc. v. Volpe , 401 U.S. 402, 410, 91 S.Ct. 814, 28 L.Ed.2d 136 (1971) ). Thus, the USDA's licensing decision is not statutorily precluded from judicial review.
2. Mootness
The USDA argues Plaintiff's challenge to the USDA's issuance of an initial exhibitor license to LPZ is moot because that "final agency action" was superseded by a subsequent final agency action—the USDA's decision to renew LPZ's license—that was subject to materially different regulatory standards than initial licensing. "Mootness is a threshold issue because the existence of a live case or controversy is a constitutional prerequisite to federal court jurisdiction." Rio Grande Silvery Minnow v. Bureau of Reclamation, 601 F.3d 1096, 1109 (10th Cir.2010) (citation omitted). The Tenth Circuit articulated this Court's standard for determining mootness in Silvery Minnow :
Without a live, concrete controversy, we lack jurisdiction to consider claims no matter how meritorious. Declaratory judgment actions must be sustainable under the same mootness criteria that apply to any other lawsuit. As we noted in Cox v. Phelps Dodge Corp., it is well established that what makes a declaratory judgment action a proper judicial resolution of a case or controversy rather than an advisory opinion is the settling of some dispute which affects the behavior of the defendant toward the plaintiff. The crucial question is whether granting a present determination of the issues offered will have some effect in the real world.
Id. (quotations omitted). Thus, to determine if PETA presents a live controversy, this Court must ascertain what type of relief PETA seeks, and decide whether, at this time, this Court can afford them meaningful relief.
PETA asks this Court to set aside the USDA's decision to issue LPZ a new exhibitor license in September 2014 as "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law" within the meaning of the APA. (Doc. # 1 at 2, 21.); 5 U.S.C. § 706(2)(A). PETA alleges the decision granting LPZ a new license harmed and continues to harm PETA by causing the organization to "spend additional resources documenting and addressing the unlawful licensing decision and inhumane conditions at LPZ." (Doc. # 1 at 3.) A decision in PETA's favor would relieve this injury by forcing LPZ to apply for a new license and ordering the USDA to make its licensing decision in accordance with the AWA. Subsequent to making its initial licensing decision, on September 4, 2015, the USDA renewed LPZ's license in accordance with the standards set forth in 9 C.F.R. §§ 2.2(b), 2.6, 2.7(d). The USDA contends the process to renew a zoo license is "materially different" from, and subject to different regulatory standards than, the process to issue an initial exhibitor license. (Doc. # 51 at 13.) As such, the USDA argues its license renewal decision was a new final agency action that "superseded" its initial licensing decision, rendering PETA's claim challenging the initial licensing decision moot. Id. PETA concedes that both the USDA's licensing decision and renewal decision were final agency actions, but argues that because "the text and effect" of the renewal decision is identical to that of the initial licensing decision, the "controversy survives...." (Doc. # 52 at 7.) On that point, this Court agrees with PETA.
The USDA grounds its mootness argument in Silvery Minnow . During the litigation of that case, plaintiff environmental groups challenged two biological opinions ("2001 B.O." and "2002 B.O.") issued by the Fish and Wildlife Service ("FWS") as arbitrary and capricious because the Bureau of Reclamation ("BOR") failed to consult with the FWS to develop the opinions as required by the Endangered Species Act ("ESA"). Id. at 1106–07. The district court agreed with plaintiffs that the 2002 B.O. was arbitrary and capricious under the ESA and ultimately ruled in the plaintiffs favor on their scope-of-consultation claim. Id. at 1107–1109. The FWS appealed the district court's ruling. Id. While the appeal was pending, the FWS issued a third biological opinion ("2003 B.O.") to replace the prior two. Id. at 1107–08. The Tenth Circuit found the plaintiffs' scope-of-consultation claim was moot because it was based solely on the 2001 B.O. and the 2002 B.O., neither of which existed since the FWS issued the 2003 B.O. Id. at 1112. The Tenth Circuit concluded that ordering plaintiffs' requested relief—an injunction directing the BOR to consult concerning the 2001 B.O. and 2002 B.O.—would have no effect in the real world because those opinions were superseded by the 2003 B.O., a biological opinion the federal agencies developed through appropriate consultation. Id. at 1112. Similarly, in Wyoming v. United States Department of Agriculture, the Tenth Circuit dismissed a case as moot that challenged the "Roadless Rule," finding "[t]he portions of the Roadless Rule that were substantively challenged by Wyoming no longer exist[ed]," because they were replaced by a new rule, differing in substance and promulgated through a new rulemaking process. 414 F.3d 1207, 1212–13 (10th Cir.2005).
The instant case differs in significant ways. Unlike the biological opinions in Silvery Minnow or the "Roadless Rule" in Wyoming, the agency decision PETA challenges—the USDA's initial licensing decision—remains in effect. (Doc. # 52 at 7.) The USDA's decision to renew LPZ's license does not supersede this initial licensing decision; rather, the former is a continuation of the latter. The AWA provides that issued licenses remain "valid and effective" so long as they are renewed. APHIS Licensure Regulations, 9 C.F.R. § 2.5(a) (2016). By its own description, the USDA's license renewal procedure essentially affirms that its initial licensing decision remains in effect. (Doc. # 51 at 15.) Further, the USDA bases its decision to renew an exhibitor license solely on compliance information volunteered by the zoo, undertaking no new investigation akin to pre-license inspections. Thus, the USDA's renewal decisions rest on determinations made at initial licensing plus the zoo's word that those determinations remain true. Id. As such, the renewal process cannot cure any defects of the initial licensing process. If the USDA licensure in September 2014 was unlawful, its renewal decision in September 2015 merely permitted the continuation of a license issued in error. PETA's question can still be answered by this Court and have real world effect. Accordingly, PETA's claims are not moot.
IV. STANDARD OF REVIEW
The APA, 5 U.S.C. §§ 701 –706, governs judicial review of agency actions. "The task of the reviewing court is to apply the appropriate APA standard of review, 5 U.S.C. § 706, to the agency decision based on the record the agency presents to the reviewing court." Florida Power & Light Co. v. Lorion, 470 U.S. 729, 743–44, 105 S.Ct. 1598, 84 L.Ed.2d 643 (1985). This Court must review informal agency action determining issues of fact under the "arbitrary and capricious standard" set forth in 5 U.S.C. § 706(2)(A) unless de novo review is prescribed by statute or demanded by the constitutional nature of the fact issues, or "substantial evidence" review if the agency decision before the Court is governed by 5 U.S.C. §§ 556 and 557 (formal rulemaking and adjudications). 5 U.S.C. § 706(A), (E), (F). The USDA's decision to issue LPZ an exhibitor license in September 2014—a factual determination—is properly reviewed under the arbitrary and capricious standard.
A. Chevron Deference Does Not Apply
The USDA asks this court to apply the Chevron doctrine to its decision to issue LPZ a zoo license. (Doc. # 51 at 16.) To support this contention, the USDA frames its decision to issue LPZ a license as an interpretive process. In choosing to base its licensing decision solely on information gathered at the pre-license inspections, the agency argues it was interpreting § 2133 of the AWA to require the USDA to consider only that evidence. Id. The USDA misconstrues the posture of this case.
The Chevron test applies to legal interpretations, not factual determinations. It is true the USDA has promulgated regulations to guide licensure decisions under the AWA (e.g. 9 C.F.R. § 2.3(a) ), but PETA is not challenging those regulations. PETA is challenging the USDA's discrete decision to issue LPZ an exhibitor license in September 2014. When it issued LPZ an exhibitor license in 2014, the USDA decided a question of fact, namely, whether LPZ was in compliance with Title 9 at the time of the pre-license inspections. That factual determination applies only to the parties to this action. This Court cannot reasonably construe the licensure as a statutory interpretation entitled to Chevron deference.
Even if this Court accepted the premise that the USDA's act of issuing a license could be construed as an interpretation of the AWA, the Chevron doctrine still should not apply in this case because § 2133 does not contain any ambiguous language that opens up the particular interpretive gap the USDA claims to fill. The AWA is silent as to both the process the USDA should follow to issue licenses and the evidence the USDA may consider to verify AWA compliance—the statute does not contemplate either criterion. The USDA cannot shoehorn its preferred licensure process into the AWA simply because the statute does not mention it. Statutory silence has never been interpreted to leave a gap for agencies to fill with interpretations of things entirely outside those contemplated by the statute. See, e.g., Animal Legal Def. Fund v. U.S. Dep't of Agric., 789 F.3d 1206, 1217 (11th Cir.2015) (finding the term "issue" in 7 U.S.C. § 2133 was ambiguous and required application of the Chevron doctrine to determine if "issue" necessarily encompassed "renew"); Chevron v. NRDC 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984) (finding agency's interpretation of ambiguous term "stationary source" to be reasonable).
Based on the foregoing, this Court will review the USDA's decision to license LPZ in September 2014 under the arbitrary and capricious standard.
B. The "Arbitrary and Capricious" Standard
"The duty of a court reviewing agency action under the ‘arbitrary or capricious' standard is to ascertain whether the agency examined the relevant data and articulated a rational connection between the facts found and the decision made." Olenhouse v. Commodity Credit Corp., 42 F.3d 1560, 1576 (10th Cir.1994) (citing Motor Vehicle Mfrs. Ass'n of the U.S., Inc. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43, 103 S.Ct. 2856, 77 L.Ed.2d 443 (1983) ). The focus is on the rationality of the decision making process, not on the wisdom of the decision itself. Olenhouse, 42 F.3d at 1575. The Supreme Court instructs:
[A]n agency rule would be arbitrary and capricious if the agency has relied on factors which Congress has not intended it to consider, entirely failed to consider an important aspect of the problem, offered an explanation for its decision that runs counter to the evidence before the agency, or is so implausible that it could not be ascribed to a difference in view or the product of agency expertise.
Motor Vehicle Mfrs. Ass'n, 463 U.S. at 43, 103 S.Ct. 2856. A court must determine whether there was a clear error in the agency's judgment. Olenhouse, 42 F.3d at 1574. In doing so, however, a court does not substitute its judgment for that of the agency. Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 416, 91 S.Ct. 814, 28 L.Ed.2d 136 (1971). It is not the court's role to weigh conflicting evidence or evaluate credibility. See Pennaco Energy, Inc. v. United States Dept. of Interior, 377 F.3d 1147, 1159 (10th Cir.2004). Even if the administrative record contains evidence which arguably conflicts with the agency's findings, it does not necessarily render the agency's decision arbitrary and capricious. See id.
A reviewing court may uphold an agency's decision only "on the grounds articulated by the agency itself." Olenhouse, 42 F.3d at 1565. "After-the-fact rationalization by counsel in briefs or argument will not cure noncompliance by the agency [.]" Id. at 1575. "If the record before the agency does not support the agency action ... the proper course, except in rare circumstances, is to remand to the agency for additional investigation or explanation." Florida Power & Light Co. v. Lorion, 470 U.S. 729, 744, 105 S.Ct. 1598, 84 L.Ed.2d 643 (1985). Although the "agency's decision is entitled to a presumption of regularity," it is not shielded from a "thorough, probing, in-depth review." Olenhouse, 42 F.3d at 1574.
When a court is applying the arbitrary and capricious standard to ensure factual support for an agency's decision, the inquiry is equivalent to that applying the "substantial evidence" standard. Id. at 1575–76 (quoting Ass'n of Data Processing v. Bd. of Governors, 745 F.2d 677, 684 (D.C.Cir.1984). Thus, informal agency action should be set aside as arbitrary and capricious if it is "unsupported by ‘substantial evidence.’ " Id. at 1576. Evidence is substantial in the APA sense if it is "enough to justify, if the trial were to a jury, a refusal to direct a verdict when the conclusion to be drawn is one of fact." Illinois Central R.R. v. Norfolk & Western Ry., 385 U.S. 57, 66, 87 S.Ct. 255, 17 L.Ed.2d 162 (1966). "This is something more than a mere scintilla but something less than the weight of the evidence." Pennaco Energy, 377 F.3d at 1156 (citations omitted).
Further, the Tenth Circuit has held the substantial evidence test imposes affirmative duties on a district court: "[T]he court must consider conflicts in the record and ‘define, specifically, those facts which it deems supportive of the agency decision if that is the court's resolution of the matter.’ " Olenhouse, 42 F.3d at 1576 (quoting Hill v. Morton, 525 F.2d 327, 328 (10th Cir.1975) ). "This requires a plenary review of the record as it existed before the agency. The district court may not rely on counsel's statements as to what was in the record; the district court itself must examine the administrative record and itself must find and identify facts that support the agency's action." Id. (citations omitted).
Applying this standard, this Court concludes USDA's decision to issue LPZ a license in September 2014 was not "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law." 5 U.S.C. § 706(2)(A).
V. ANALYSIS
Based on the above case law, in reviewing the USDA's decision to issue LPZ a new exhibitor license, it is this Court's duty to determine from the whole administrative record: (1) what evidence the USDA considered in making its licensing decision, and (2) whether that evidence is sufficiently "substantial" in the APA sense to support the USDA's decision. If this Court cannot determine from the administrative record the grounds upon which the USDA based its licensing decision, this Court must "remand to the agency for additional investigation or explanation." Florida Power & Light Co. v. Lorion, 470 U.S. 729, 744, 105 S.Ct. 1598, 84 L.Ed.2d 643 (1985). However, this Court may "uphold a decision of less than ideal clarity if the agency's path may reasonably be discerned." Motor Vehicle Mfrs. Ass'n of U.S., Inc. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43, 103 S.Ct. 2856, 77 L.Ed.2d 443 (1983) (quoting Bowman Transp., Inc. v. Arkansas–Best Freight Sys., Inc., 419 U.S. 281, 286, 95 S.Ct. 438, 42 L.Ed.2d 447 (1974) ).
The USDA based its September 2014 decision to issue LPZ a new exhibitor license entirely on information learned during two pre-license inspections and the reports accompanying those inspections. (AR at 86–88; 89.) APHIS conducted its first pre-license inspection of LPZ on July 8, 2014. (AR at 86–88.) The first post-inspection report noted several areas of noncompliance with the Secretary's licensure standards, including:
(1) Missing barrier fence around porcupine enclosure in violation of 9 C.F.R. § 2.131(c)(1),
(2) Night housing units for non-human primates in various stages of disrepair in violation of 9 C.F.R. § 3.75(a),
(3) Interior fencing of the zoo in disrepair, including chain link fence of the whitetail deer enclosure in violation of 9 C.F.R. § 3.125(a),
(4) Old freezer unit still in use in violation of 9 C.F.R. § 3.125(c) that needed to be removed or repaired,
(5) Perimeter fence around the exterior of the zoo "not entirely 8 feet," as required by 9 C.F.R. § 3.127(d) if enclosures around dangerous animals are not 8 feet in height and 3 feet from the exterior fence, and
(6) Kitchen used to prepare animal diets remained in disrepair in violation of 9 C.F.R. § 3.131.
(Id. ) APHIS conducted its second pre-license inspection of LPZ on August 27, 2014. (AR at 89.) The second post-inspection report states, "NO NONCOMPLIANCE IDENTIFIED IN THIS INSPECTION." (Id. ) The report does not include any other details about how or whether LPZ resolved the issues of noncompliance noted in the previous report.
In light of these reports and the USDA's conclusion, the main issue for this Court is whether these reports and the knowledge the USDA gained during its pre-license inspections is "substantial evidence" sufficient to support the agency's decision to issue LPZ a license. Given the presumption of validity that attaches to agency action and the USDA's high level of expertise in zoo inspections, this Court concludes it was reasonable for the USDA to rely on its own inspections and reports to make its licensing decision and that the inspection reports constitute substantial evidence supporting the agency's decision. No evidence in the record demonstrates the USDA (1) failed to consider an important aspect of the problem, (2) offered an explanation for its decision that runs counter to the evidence before the agency in light of agency's expertise, (3) failed to base its decision on a consideration of the relevant factors, or (4) made a clear error of judgment.
Although the USDA made its licensing decision based solely on APHIS's pre-license inspections and reports, the administrative record includes various letters, photographs, and videos PETA sent to the USDA from approximately May 2014 to May 2015, with some items dating back to 2010. PETA urges this court to conclude, based on its evidence, that LPZ could not have been in compliance with the USDA's licensure standards in Title 9 on September 4, 2014 when the USDA issued the zoo its new exhibitor license. It is clear PETA has kept a close watch on the conditions at LPZ, including around the time the USDA issued LPZ its new license. Indeed, PETA sent the USDA letters noting LPZ's alleged violations of the AWA on May 15, 2014 (AR at 111), June 6, 2014 (AR at 120–121), July 24, 2014, (AR at 91–92.) and September 11, 2014 (AR at 79, 125). However, none of the organization's observations undermine the USDA's conclusion—after conducting its own inspections—that LPZ was in compliance with Title 9 in September 2014. First, a layperson's observations cannot substitute for the judgment and expertise of the USDA and APHIS inspectors, to which this court owes deference. Utah Envtl. Cong. v. Dale Bosworth, 443 F.3d 732, 739 (10th Cir.2006) ("Deference to the agency is especially strong where the challenged decisions involve technical or scientific matters within the agency's area of expertise."). Second, the USDA did not ignore PETA's complaints; it took note of the alleged violations, conducted its own inspection, and concluded LPZ was in compliance in September 2014. (AR at 90, 124.) Just as a police officer cannot make an arrest post hoc based solely on information from a third party, neither can the USDA deny zoo licenses to facilities allegedly falling below Title 9 requirements according to PETA when its own inspections show otherwise. It is clear from the record that PETA and the USDA differ in their belief of what constitutes a violation of Title 9 standards, but this difference in opinion is the "product of agency expertise." Motor Vehicle Mfrs. Ass'n, 463 U.S. at 43, 103 S.Ct. 2856.
Part of this Court's arbitrary and capricious analysis requires the agency to articulate, in the record, the rationale underlying its decision. The USDA issued LPZ a new exhibitor license because the APHIS inspector found "no noncompliance" issues as of August 27, 2014. This rationale is admittedly limited, but not inadequate. That the USDA did not note all the reasons LPZ was in compliance and instead concluded, simply, there was "no noncompliance" identified in the inspection, does not weaken the heft of its conclusion. Certainly, one can imagine a more comprehensive report—perhaps a long checklist of all possible areas of noncompliance next to a "pass/fail" column for each area—but that would not make it more or less reasonable for the USDA to issue a license to a zoo in complete compliance with Title 9. This Court's only task is to determine if, based on the information in the record, the USDA acted reasonably when it issued LPZ a new exhibitor license. This Court finds issuing a license to a zoo with no identified areas of noncompliance is reasonable and that the USDA's decision was supported by substantial evidence in this case.
If the USDA had a habit of issuing token "all-clear" inspection reports, PETA's case for sham-licenses would be more convincing. However, the record shows that the opposite is true. USDA found LPZ was out of compliance in July 2014 and completed a comprehensive report listing each area of noncompliance. (AR at 86–88). The USDA inspector informed LPZ of the availability of two additional inspections and the 90–day deadline to meet 100% compliance. (AR at 88.) Then, on August 27—fifty days after the first inspection—the USDA's second inspection found LPZ was in compliance. (AR at 89.) Given the detail of the Title 9 noncompliance documented in the first pre-license inspection report and the second report noting full compliance two months later, this Court finds the "agency's path [of decision making] may reasonably be discerned." Motor Vehicle Mfrs. Ass'n, 463 U.S. at 43, 103 S.Ct. 2856.
VI. CONCLUSION
The Court finds that the USDA's decision to issue LPZ an exhibitor license in September 2014 was supported by substantial evidence and thus was not arbitrary, capricious, or otherwise contrary to law. Accordingly, the agency's decision is affirmed.