in the superior court of the state of washington...

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IN THE SUPERIOR COURT OF THE STATE OF WASHINGTON

IN AND FOR THE COUNTY OF THURSTON

WILLAPA BAY GILLNETTERSASSOCIATION, a Washingtonnonprofit corporation,

Petitioner,

vs.

WASHINGTON DEPARTMENT OFFISH & WILDLIFE, an agencyof the State of Washington,

Respondent.

))))))))))))))

No. 15-2-02078-34

___________________________________________________________

VERBATIM REPORT OF PROCEEDINGS

BE IT REMEMBERED that on the 19th day of May,

2017, the above-entitled and numbered cause came on for

hearing before the Honorable James J. Dixon, Judge,

Thurston County Superior Court, Olympia, Washington.

Kathryn A. Beehler, CCR No. 2448Certified Realtime Reporter

Thurston County Superior Court2000 Lakeridge Drive S.W.

Building 2, Room 109Olympia, WA 98502

(360) 754-4370

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A P P E A R A N C E S

For the PetitionerWillapa BayGillnetters Assoc:

Ryen L. GodwinAttorney at LawSchwabe Williamson & Wyatt,P.C.1420 5th AvenueSuite 3400Seattle, WA [email protected]

For the RespondentState of WA DFW:

For the IntervenorTwin Harbors Fish &Wildlife Advocacy:

Michael S. GrossmannAssistant Attorney GeneralP.O. Box 401001125 Washington Street SEOlympia, WA [email protected]

Joseph Donald FrawleyAttorney at LawSchefter & Frawley1415 College Street SELacey, WA [email protected]

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I N D E X

Description Page Reference

Court Calls Case/Introduction of Parties 4

Discussion re: Motion to Exclude 5

Argument by Mr. Godwin 10

Argument by Mr. Grossman 48

Argument by Mr. Frawley 84

Rebuttal by Mr. Godwin 89

Oral Opinion of the Court 105

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Court Calls Case/Introduction of Parties 4

May 19, 2017 Olympia, Washington

AFTERNOON SESSION

The Honorable Judge James J. Dixon, Presiding

Kathryn A. Beehler, Official Reporter

--o0o--

THE COURT: Be seated, please. The matter

before the court is Willapa Bay Gillnetters

Association vs. Washington State Department of Fish

and Wildlife, Cause Number 15-2-2078-34. The matter

comes before the court on the Petitioners' Petition

for Judicial Review filed November 2, 2015. The

petitioner is present being represented by

Mr. Godwin. Mr. Godwin, good afternoon.

The State Fish and Wildlife is represented by

Mr. Grossman. Mr. Grossman, good afternoon.

MR. GROSSMAN: Good afternoon.

THE COURT: Intervenor respondents appearing

are Twin Harbors Fish and Wildlife Advocacy being

represented by Mr. Frawley. Good afternoon,

Mr. Frawley.

MR. FRAWLEY: Good afternoon, Your Honor.

THE COURT: And Coastal Conservation

Association being represented by -- Mr. Frawley?

MR. FRAWLEY: Mr. Talmadge is not available

today. I'm representing both interveners.

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Discussion re: Mr. Godwin's Motion to Exclude 5

THE COURT: Okay. The court has received and

reviewed the pleadings. The court has reviewed the

entire file, including the record in this case. And

the court intends to hear first from Mr. Godwin

representing his clients. He represents the

Petitioner; the court will then hear from

Mr. Grossman; the court will then hear from

Mr. Frawley. And because Mr. Godwin represents the

moving party, the court will, time allowed, hear

again from Mr. Godwin in rebuttal.

First there's an issue before the court that I

see -- or there was a pleading filed yesterday after

the court had already reviewed the record. It was a

pleading from Mr. Godwin to exclude part of the

record, as I recall. Mr. Godwin, what's that all

about, please?

MR. GODWIN: There was a -- as the process

proceeded, the parties wanted to leave open the

opportunity to supplement the agreed portion of the

record within a time period that everybody could see

it and respond to it as appropriate. That -- there

was a second supplement that I believe was filed on

Monday. Much of that supplement I have no dispute

with. It has been discussed, disclosed; we've

outlined what it would contain. But there were a few

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items — let me cite the Bates numbers here — Bates

Numbers 1175 to 1179.

THE COURT: And I don't know what those are.

MR. GODWIN: Well, those were attached to the

Notice of Second Supplemental Rulemaking. And I

don't have -- I had objected to those as part of the

agreed record. I filed a -- rather than try to get

and note motion to strike, I -- well, let me tell you

why I objected. The reason I objected is, I didn't

have any notice of those within the time I would have

been allowed to address them in my briefing.

I'm not saying they're not part of the broader

administrative record, but the point of outlining an

agreed record is, everybody has time to identify the

issues, identify a subset of the administrative

record that is appropriate for the case, and then,

convey that to the court and then all of the parties

so they can address it in the briefing. With those

specific -- with those four pages, that did not

happen. I was notified that they were -- the State

intended to submit them as part of the agreed

administrative record on the day that my reply brief

was filed.

Now, the parties did have an informal agreement —

and I think I've put this a little bit in the

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objections — that everybody can supplement the agreed

record, as appropriate, up to the point of which they

would be filing their last brief, so that everybody

had the opportunity to respond to them. And that

just didn't happen. And so I filed an objection.

In my objection, however, I -- after speaking --

Mr. Grossman and I spoke about this before bringing

this to the court. I indicated that what I would do

is, I would file an objection for the court's record

that if he attempted to use it in the proceeding, I

would then raise an objection accordingly in the

proceeding, in here.

THE COURT: Okay. Thanks. And it appears,

more specifically, those documents include a letter

from Mr. Radtke to the chair of the fish and wildlife

commission, a briefing paper.

MR. GODWIN: Your Honor, I just -- I'm sorry

to interrupt. I want to narrow that. It's not --

the supplement, the Radtke letter, that's not part of

the subset that I'm concerned with.

THE COURT: Okay.

MR. GODWIN: It is only that last item, the

Excel spreadsheet printout. But its -- 1174 we had

talked about and was disclosed months before this

hearing.

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THE COURT: Okay.

MR. GODWIN: It's 1175 through 1179.

THE COURT: Mr. Grossman?

MR. GROSSMAN: Thank you, Your Honor. So the

actual documents or -- it is a single document. It's

an Excel file. And what I included in the record was

the output from that Excel file. It's the Excel file

that's used to do the final rule. And it's what

scientists do to model all the information, come up

with final rule that they're going to propose. And

so it actually contains the rule that's being

challenged.

We did have an agreement, but it related to when

materials were going to be provided, if they were

going to be cited in a brief. These documents

haven't been cited in a brief by them or by us. I

did reference in my brief on -- in my trial brief on

page 13 a process by which the rule is modelled. And

I referenced it. I didn't cite to the thing.

I got to thinking, you know, during oral argument,

it might be nice to have a demonstrative exhibit.

And so if I -- you know, if the issue comes up -- I'm

not even sure it will come up, because it's getting

into the weeds. But it is sometimes -- my experience

has been with these rule cases, that sometimes we do

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get into the weeds, and it would be nice to have a

demonstrative exhibit.

Ultimately, my position is, we had an agreement

about when things are cited in a brief. This has not

even been cited in a brief. It is, in fact, part of

the record, the administrative record. The APA

specifically states, "The administrative appeal shall

be based on the administrative record." So there's

not a question of it not being in there.

There is a question of whether or not, when we

agreed to a shortened record, that somehow there

would be prejudice if this issue, which neither of us

cites in our brief, is added to the record -- excuse

me, the agreed shortened record for purposes of a

demonstrative exhibit.

I don't understand how they are prejudiced.

They've had this for over -- well, since we filed the

record -- or since we developed the original record

and shared it over a year ago. This model is on the

agency's website. His clients use the model to come

to the agency --

MR. GODWIN: I'm going to object to that

statement.

MR. GROSSMAN: -- and provide examples of what

they'd like to see in terms of fishing. It's well

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known, and I just don't understand the prejudice to

him.

At the end of the day, I don't think I need it,

but I just wanted it in case we got into the weeds to

use it to demonstrably show what I've described in my

brief on page 13.

THE COURT: I haven't looked at it --

MR. GROSSMAN: Okay.

THE COURT: -- so I think it might be a moot

point.

MR. GROSSMAN: Okay.

THE COURT: But if there is a reference to

intended exhibit which includes the referenced

spreadsheet, then the court will consider an

objection from Mr. Godwin or Mr. Frawley, if

Mr. Frawley wants to object.

Okay. Thanks. Mr. Godwin, I'll hear from you,

please.

MR. GODWIN: The other issue before the court,

just to guide my presentation, Your Honor, is the

State's motion to dismiss the first two claims.

Would you like me to address those, the response to

that, in my presentation?

THE COURT: Whatever makes you feel most

efficient.

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MR. GODWIN: What I'd like to hand up,

Your Honor, is -- the record is quite voluminous

here. I have circulated these to the other parties.

This is Petitioners, just, subset of what we

determined or I determined are really the pertinent

documents for our petition.

THE COURT: Okay.

MR. GODWIN: It is taking it down from, like,

1,200 pages. And I'd like to just hand that up to

the court for -- to track while I'm going through the

presentation.

So like I said, I represent the Willapa Bay

Gillnetters Association. This is a Petition for

Judicial Review of a rulemaking. This is a challenge

to a process. And the question that we are raising

for the court is whether or not the process employed

here meets the legislative delegation to this

agency -- to this state agency. And so the

question of the -- that goes first to what is the --

what is their legislative delegation of authority.

Their statute is generally -- it's Title 77

regarding the Department of Fish and Wildlife.

There, just as an introductory kind of walk through,

this organization -- or this agency is organized in a

fashion where there is kind of an executive branch.

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You have a director and a staff. That's under

77.04.080.

THE COURT: Hang on. I apologize for

interrupting, but I want to make sure that the

world's greatest court reporter can keep up with

you --

MR. GODWIN: I'm sorry about that.

THE COURT: -- and I suspect she's being

challenged.

MR. GODWIN: I have "slow" written on my

notes, and I will follow that.

THE COURT: Thanks. I'll hold you to it.

MR. GODWIN: Separately, there's a legislative

branch in this agency, and that's the Department of

Fish and Wildlife commission. The commission,

however here, unlike our tri-part government at the

federal level and most of the state level, there is

no judicial branch within the agency. That is you,

Your Honor.

You're the one that has to overview, see what's

going on here. And you're, I think, an integral

part of the -- the judiciary is an integral part in

the agency process. Because somebody has to review

whether or not the process that's being undertaken

for these agencies is appropriate and meets what the

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Legislature told them to do. Otherwise, the

Legislature doesn't oversee what's going on on a

day-to-day basis.

That is very important for the delegation of

authority: What is the Legislature telling the

agency that it is permitted to do. And then it steps

away and let's the agency kind of go about its daily

business in a very kind of scientifically detailed

policymaking or rulemaking process. But somebody has

to look at that and say, okay, did that -- did what

you did today meet what the Legislature told you to

do.

In addition here, the agency has authority to do

all kinds of things. They have authority to do some

rulemaking. They have express authority to do a type

of policymaking. And it's outlined in the statute.

They have a number of other actions that they're

permitted to do.

They're permitted to condemn property, to buy

property, to hire people, to pass budgets,

expenditures, things like that, all through a process

that's outlined in enormous detail in that statute,

to give this agency exactly the direction that it

needs in order so that the Legislature can step away

and allow the agency to operate. But the question,

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again, is whether or not that process is being met.

Because if it's not, the agency has -- or the State

here, the agency has stepped aside, outside of its

legislative authority in whether that act is lawful.

In addition to that claim -- that's really relating

to my first two claims for relief.

The other claims deal with whether or not the

substance of the decision was arbitrary and

capricious. That's a very high bar. And I will be

the first to admit that. And I will get into those

specifically later. But I think here you have such a

significant decision made and such -- such

contradicting evidence contained in the record that

at some point they disregarded that evidence. And

it, I believe, leads to an arbitrary and capricious

decisionmaking.

Finally what the statute in fact tells the agency

to do is, there -- is to follow the APA. It says you

need to follow the Administrative Procedures Act when

you're going through your rulemaking process. And

that process -- and I've actually, just so the court

has it in front of them, I think the Department

attaches an appendix, a very confusing flow chart

that has arrows going everywhere.

There is actually a slide in the record that

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contains a very concise what does the rulemaking

process look like. That's item -- that's Number 13

in my key documents booklet. It's in the record at

451. And it kind of has just a basic flow chart of

what the rulemaking process looks like.

So it says -- so we go to what is the

Legislature's intent. The Legislature says,

Department of Fish and Wildlife, these are the things

you can do. You can do some of the stuff by policy;

you can do some of the stuff on your own; and you can

do -- the rest of it you must do specifically through

rulemaking. And so then we go to what -- and then it

says specifically in there -- in their statute it

says, you must do your rulemaking through the APA.

That is important.

So for purposes of the first two claims for

relief, we're attacking the rule process. So what --

whether or not the agency followed its delegative

authority in conducting the rulemaking that it went

through for these regulations. Now, these

regulations are fishing regulations. They're only in

effect for a period of time for a particular season.

So these are the 2015 rules. Those rules have since

expired.

Your declaration that those rules are invalid

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today has very little practical effect. And now, you

notice that nobody's raising the mootness argument,

because clearly that's capable of repetition every

year that they engage in this type of rulemaking.

So what's important about our request for relief

is, now we're asking, in addition to that declaratory

judgment that says -- telling the agency that you

must disregard the mandatory portion of this policy

in your rulemaking; you are allowed to consider

everything that's presented to you during the

rulemaking process, and you are allowed to diverge

from whatever you're being told to do.

Because -- and that's important, because the APA

provides a rulemaking process that has significant

amounts of public participation. And that public

participation is important from the legislative

perspective, because it provides credibility and

accountability to that action.

So going now to the -- kind of the specifics.

What is the general law behind agency authority.

Well, there's been a body of case law. I think it

starts with the Green River College case in the '70s

or '80s. And it has trended towards a very specific

rule. And that rule is that agencies are limited to

their express legislative authority.

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I can cite a number of cases. And I'd like to

just briefly start with a quotation. It says -- and

this is -- I'm citing Washington Federation of State

Employees vs. State Department, 152 Wn. App. 368. It

says,

"Agencies may exercise only those powers

conferred on them expressly or by necessary

implication. If an enabling statute does not

authorize particular regulation, either expressly

or by necessary implication, that regulation must

be declared invalid whether its for a practical

necessity or appropriate."

It may have a very good reason for doing that, but

if it's not the process that was provided for in the

Legislature -- by the Legislature, then it's per se

invalid. There's no concept that you can -- there's

no just general implied authority; Well, it's not

prohibited, so therefore, we can do it this way.

That's not how agency authority works.

What it is is, you have to look at what is the

express authority of the Legislature, and what are

you expressly permitted to do. There is an

opportunity to fill gaps. Certainly the

Legislature's not going to think of everything. But

when it does speak to something, you have an issue of

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legislative intent.

So how do we interpret the statute? We looked at

the Legislature's intent. We have to determine from

the statutory scheme, what did they mean by this,

what did they mean by that, whether or not there are

provisions that mean something else or that their

authority is already dealt with in another section of

the statute.

So going specifically to the statutory provisions

at issue here -- and I'm talking specifically

about -- what we believe is there are provisions of

this policy that the policy is that Willapa Bay

Salmon Management Policy that directs time and place

and harvest restrictions that are mandatory; telling

the Department's director and staff that they cannot

alter those prescriptions in the subsequent

rulemaking process. So is it -- was that process

that was engaged in at that point truly the public

process that is required by the Administrative

Procedures Act.

THE COURT: Well, I think Mr. Grossman would

take exception with that, and of course, I'll let

Mr. Grossman and/or Mr. Frawley speak for themselves.

But I don't think that they would agree that that is

what the process was. I think their argument would

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be that there is no telling, that it was simply a

recommendation, for lack of a better term.

MR. GODWIN: They would say it's guidance is

what I think their argument is. And so the question

we have there is, where on the record does it suggest

that? What facts do we have? There's a factual

dispute here. That is very clearly a factual dispute

between the parties that has been -- that we have had

numerous discussions about, that significant portions

of the record -- this agreed record deal with that.

And the factual dispute is this: Well first, if you

don't mind, I'd like to go to what is the

legislative -- what does the Legislature say about

this process, so we kind of guide that; what is the

significance of that dispute.

So the statute says very clearly,

"The commission shall establish provisions

regulating food fish and shellfish as provided by

RCW 77.12.047."

Food fish -- there's no dispute here that the

fish that -- the commercial fishing here is food

fish, this type of salmon. That does not come up as

an issue.

So we go to RCW 77.12.047 (4). So what is the

commission permitted to do for regulating food fish.

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77.12.047 says,

"You may adopt, amend, or repeal rules for times

for taking the fish, for places to take the fish, and

for the gear type and the quantities of fish that you

are going to take."

So the question is -- for me is where -- what

other activities can the commission engage in for

this process. Well, their point is, hey, we can do

this by policy and then subsequently go through the

rulemaking process. Well, in 77.04.055 it says what

they can do by policy.

So the Legislature has actually said, this is what

a policy is. This is -- you can have general

guidance, give the Department some sort of direction

as to where you want them to go. This is the -- this

is our intent and those sorts of -- those sorts of

things. These are lofty objectives and goals and

direction. All of that is appropriate in a

policymaking. And this is 77.04.055.

Where it crosses the line is where you prescribe.

Because at that point, those aren't general goals and

objectives. And why I wanted to step back and go to

what does the statute say when we look at where this

dispute exists is that -- is in the statute, if all

of this statute said — this is 77.04.055 — is that

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you may regulate food fish under 77.12.047 and it

didn't -- and there was nothing in the statute -- in

the Department of Fish and Wildlife's statute dealing

with policies, then they'd probably have a pretty

good argument to say, well, it doesn't really say

anything about policies, and policies are permitted;

it's just internal guidance; and that's how -- what

we do. But here the Legislature actually spoke to

it. It said, this is what a policy is supposed to

be; it's supposed to be broader than prescription.

It says an establishing policy is to preserve,

protect, or perpetuate fish and wildlife, fish

habitat, the commission shall meet annually with the

governor, review and prescribe objective goals and

objectives related to those policies, review the

performance of the Department in implementing fish

and wildlife policies.

These are very sort of what I would consider the

30,000-foot level sort of objectives. This is --

it's a high level. But then it starts whittling down

on subsection (3) and very specifically says,

however, if you are going to establish a regulation

for food fish, you have to do it by 77.12.047.

And then when we go to 77.12.047, it says,

"The commission may adopt, amend, or repeal rules"

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for the time to take the fish, the place to take the

fish, the gear type, and the quantities. And in

addition to that, Your Honor, I just want to then

point to 77.04.130. And I'll give you a moment to

get there.

This is in the Department of Fish and Wildlife's

enabling statute specifically. It says, if you're

going to go through the rulemaking process, you must

do it thru 34.05. All rules shall be adopted by

34.05. So the prescription in my mind, whether that

policy is prescriptive and how it affects the

rulemaking process is fundamental here. And it is

fundamental because the Legislature says it is. And

it says that if you're going to do something that is

regulatory, mandatory on the public, you have to do

it through this public process under 34.05.

So then we get to your factual dispute, which I

think is significant. So is the policy prescriptive

and did the Department -- so remember, we have two

different -- two different sides to the Department of

Fish and Wildlife. We have sort of the executive

branch, and we have a legislative branch.

So the question is, did the legislative branch

intend it to be prescriptive. They intended the

staff, as they went through the rulemaking process,

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to permit any alteration from those time and place

prescriptions. And then the second question is, what

did the staff think they meant when they went through

that process. Because what they thought they meant

means that it was actually the -- that's actually

what happened as they went through the rulemaking

process.

So we have -- you'll see citations in the record

to a number of transcripts. Because those

transcripts are from the policymaking process, these

hearings that they were holding for with the public

and the Department staff and the commission. And

it's a -- I've kind of excerpted specific transcripts

sections. It's tab 12 in my notebook.

So in tab 12 you have some citations to various

commission members and describing what they're doing.

And, in particular, the comments of

Commissioner Wecker are very instructive at 1145.

That's administrative record Number 1145. At the

bottom of the page, it -- and she says --

Commissioner Wecker, "And I think that's what we're

trying to get at is some degree of in-season

management, to hold the Department accountable,"

to --

THE COURT: "Hold the fleets accountable."

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MR. GODWIN: "Hold the fleets accountable."

They have very specific direction that this is

important. And, in fact, she goes -- at another

location she says,

"We want them to know we mean business."

And I cited that in my briefing. And then there

is a discussion in the policy that talks about what

happens if they exceed the harvest rate, this

20 percent harvest rate. And again, I'm not

attacking that provision as to what -- whether you

exceed it or not. What I'm getting at is, what is

the commission's intent. And she references or uses

the word -- and this is at 1144 when she's describing

the -- Commissioner Wecker is describing kind of what

incentive they're going to implement in the policy to

keep the Department doing what they want it to do.

And she says,

"It could result in a situation where the

commercial fleet which would bear the brunt of this

is penalized by fishing over, you know, as a result

of a lower forecast."

And I'm sorry. I -- that is Commissioner Kehoe

that said that. So they see this as this is an

accountability. There are penalties. And then,

importantly, what does the staff think of this? So

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Thiesfeld was the Region 6 manager, who is the -- in

the executive branch now, the staff member that's

kind of going to implement this process. And he's

taking direction from the commission. And at

AR 1015, he's having a discussion with a couple of

commissioner members. And one commissioner member in

particular, Commissioner Kehoe, is concerned that,

"Well, it doesn't say that you can fish in this

section."

So they're talking about the policy, and so the

policy "doesn't say you can actually fish in this

area of the bay. So how do we know whether or not we

can do this?"

And he says, "Well, but I assure you, I've spend a

lot of time" — and this is at AR 1015, Bates 1015,

starting at line 9 and 10, actually 10,

"But I assure you, I spend a lot of time

responding to folks. That is not explicitly

prohibited in the policy; therefore it can be

allowed."

So there is some prohibition here. There's

something that says very discretely, you can't --

that is prohibited. Regardless of what happens in

the subsequent rulemaking process, we can't change

that. That's what it says right here. And that's

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what Kehoe's concerns are.

And then the Department will step in and say, you

know -- well, let me find it. Commission Wecker

says,

"You know, I think the reason it's not

specifically stated is that this is guidance and

these are like guideposts. You know, we can't let

them go out of those guideposts."

Well that's the kind of prohibition that I think

is specific here. Okay. You put lines on a road so

people don't cross them. Those are prohibited. You

can't just cross a double yellow line. That's a

prohibition. Even if there are guideposts as to a

direction, when you prohibit a time, you cannot fish

at this location at this time and say, Department,

we're going to hold you accountable if you violate

that, that's a prohibition. That's prescriptive. So

that's -- that's the dispute.

Now, the Department points to the policy,

internally in the policy. There's a -- there's sort

of a -- there's a paragraph, an exculpatory -- what I

would call an exculpatory paragraph. That says --

and the policy is contained on -- it's tab 6 in my

key documents binder. And on the -- it's Bates

Number 798. It's the last page in the policy where

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the -- you know, the standard terms are usually

contained in a contract. And it says this is

guidance. It establishes a number of important

conservation allocation principles for the director

and agency staff; that this is -- we don't intend

this policy to be mandatory. And so the State points

to this provision.

Well, just like statutory interpretation, contract

interpretation, what we look at is, is there

ambiguity contained in the document itself. Where

here you have some ambiguity. You have very

prescriptive provisions. Thou shall not fish in

areas 2-T and 2-U prior to September 16th. Thou

shall not fish in areas 2-M, 2-N, 2-P and 2-R until

after September 7th and a number of others that are

mandatory time and place restrictions.

Then you have this statement that says we said

"shall," but we didn't mean it. That creates

ambiguity within the document to me. And to me,

because that's ambiguous, we have to look at what was

the intent. And that's why those comments from the

commissioners and from the staff are important is

that guides, what is the intent behind those

prescriptions, are they, in fact, prescriptive.

And I think that's where this factual dispute lies

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is that you have the State essentially saying, look,

it says "guidance" in the policy; it just says

guidance. We put this in there and that protects us.

Then but what do they really mean? Well, they meant

it to be prohibited. It said that's not prohibited

so it can be allowed. But if it was prohibited, it's

actually prohibited, and it will not happen. And so

that's important from a, how do we interpret this

document? It is, in fact, prescriptive.

So how does the State respond to this analysis?

What is their response, in my view? Their response

is, this is the -- this is the flexibility that we

need in order to do this. They outline, I think,

pages 13 through 15 in the State's brief. It goes

through a very lengthy description of how they went

through the process, why this is important, how they

need flexibility to do this and that. And that's --

that's great.

I think that -- that perhaps that level of

flexibility is necessary. That's a legislative

question; that's not an agency question. And what's

important about their brief on that section, pages 13

through 15, that I think gets to kind of the essence

of this dispute, is they don't cite to a single piece

of statutory authority that says they can do it this

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way. There is not a single citation or piece of --

or there's not a single statute that says go ahead

and do this, to prescribe -- go through the

rulemaking process, but you've already prescribed it,

so it can't be changed through that process.

I want to take a moment to just talk about the

Sudar case, because it's briefed by both the

Interveners and the State. The Sudar case was a

petition on a rule, but what was challenged there was

the policy itself. It wasn't the -- they hadn't

issued the rule yet. And so the petitioners there

challenge the policy as a rule.

The court looked at the definition of what is a

rule in the Administrative Procedures Act and

determined that that policy didn't meet the

definition of a rule, because you couldn't go out and

fish based on the policy. It didn't have any express

effect on the regulated public, because there was

subsequently going to be rules. And that gets a

little bit into the motion to dismiss is what

happened here.

The Petitioners in this case, we filed first in

Pacific County not challenging the policy as a rule.

That had already been dealt with in Sudar. We

challenged it as other agency action. And under the

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federal authority which I have cited in my -- in the

motion to dismiss, other agency action includes those

actions that are nondiscretionary on agency staff and

the public.

So whether -- in contrast, the State -- the

State's case law suggests that only those actions

that have regulatory effect on the public are

actually agency action. It doesn't matter what

happened with the staff. It doesn't matter if it's

prescriptive on the staff. You have to wait until

the rule, until whatever comes out, and then

challenge the whole thing. And, actually, that has

happened in the past.

I want to cite to -- it is -- I believe it's

Puget Sound Crab Association, 174 Wn. App. 572.

Actually, if you read the facts and the procedural

history of that case, they challenge both the policy

and the rule. The court didn't deal with the

justiciability issue in that case, and it went up

through appeals. They ultimately lost on the

arbitrary and capricious analysis. But they

challenged both the policy and the rule.

So what the Gillnetters did is, we challenged the

policy alone in Pacific County. And we argued that,

well, this is nondiscretionary on agency staff, and

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therefore it's justiciable. Well, the court said,

it's not justiciable; you have to wait until the

regulations come out. And that's what's contained in

the order. It's a justiciability issue. And, in

fact, that's what the argument that was made which I

cited in my brief and attached a transcript of this,

as the State was arguing, they can seek everything

they seek today in a rule challenge in

Thurston County.

And so what happened is, the rules came out. We

modified our petition to not -- we're not seeking

relief against the policy anymore. Our relief is

against the rule, to invalidate the 2015 rule and to

direct the staff to go through a rulemaking process

that does not view the policy as prescriptive.

Had I prevailed in the Pacific County case, in my

opinion, I would have altered the actual language of

that policy. This case has nothing to do with that.

We would not -- that policy would remain there. But

I think a direction from this court that says, agency

staff, you can disregard that policy, if appropriate,

in the rulemaking process. It is not mandatory.

That's a different sort of case. That's a different

issue.

So then I want to get now to the -- so just to

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wrap that up, that's what we're seeking in our first

and second claims for relief is that, invalidate the

2015 rules, to get a declaratory judgment that

essentially says, Department, you can disregard the

mandatory provisions of that policy, and they can be

altered in the subsequent rulemaking process for

future years. That's what makes this case not moot

and I think it also makes it justiciable.

Going to the third claim for relief -- just for

purposes of the record, it was voluntarily dismissed.

So going on to the fourth claim for relief, which is

the economic impact analysis. The standard of review

here is arbitrary and capricious, quite high. But we

do have some guidance in this area, and it's

Puget Sound Harvesters Association vs. Department of

Fish and Wildlife.

So what does the "arbitrary and capricious"

standard mean in these sorts of fish cases, where you

do have a certain level of complexity that certainly

would be deferential to the agency? What that case

says is -- well, what happened in that case is that

they allocated fish opportunity equally by days

between two user groups, a purse seine and a gill

netting boat, which are -- without getting into

details, they are just two different types of fishing

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that -- and they have different success rates.

They didn't -- the agency failed to account for

the complexities in the different types of fishing

and the likelihood of success for those two types of

fishermen. And without accounting for that

complexity, one group was significantly -- the rule

was significantly more detrimental to that group than

it was to the other. And they just didn't consider

it. They just said, hey, we're just going to -- we

raise our hands; we're having trouble doing this;

we're going to split it equally between you.

And the court said, while we do defer to you on

these technical matters, you can't go through a

cursory analysis. You must have some substance to

your analysis as to why -- as to why you're making

one decision versus another and why you're applying

some technical rationale as to how to implement these

regulations or how to go through this regulatory

process.

So how does that relate to this case? Well, the

Legislature has a -- what's often cited as a mandate

to the Department of Fish and Wildlife, and that is,

you must preserve the resource, and consistent with

that, you must seek to maintain the stability of the

fish and --

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THE COURT: Economic wellbeing?

MR. GODWIN: -- economic wellbeing. Exactly.

And so, in addition to that, we know that economic

wellbeing is very important, because in a separate

section it actually says, you know, we want the

Department to engage in some sort of process to

ensure that salmon harvest stability for the

commercial industry. Now, that's -- there's no

prescriptive sort of claim there. I wouldn't say

there's no -- no substantive right there. It just

says to the Department, we just want you to go out

and really try to figure out how to do this in order

to maintain that commercial industry.

So in this case, looking at their economic

analysis, they use a report that was prepared in

2008. And it's by an author named Wegge, W-E-G-G-E.

And he uses a couple of indices to figure out what is

the impact of any particular action. One of those is

X vessel value. X vessel value, very simply, is the

amount of money the fisherman gets at the dock for

the fish they catch, on average. For recreational

fishermen, they use angler days; how many days does a

fisherman go out, whether or not they'll have more

days or less days. And that's how they assess the

economic impact of their regulations.

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Well, the gillnetters hired and prepared a report

with Professor -- or Dr. Radtke. And what he says

is -- he looks at this economic analysis that the

Department went through, and he looks at the Wegge

report, and he looks at the publically available

information, and what is their economic analysis.

And he goes, you know, I prepared that data. You

can't use it here. X vessel value doesn't work here.

And in, fact, the Radtke report is Number 11 in my

key documents brief -- the key documents binder. And

he says very specifically at Bates Number 1158,

X vessel value is not representative of the

commercial sector financial stability for several

reasons. He outlines those various reasons. I'm not

going to necessarily repeat them on the record here.

But then he concludes that WDFW should not use

X vessel value at Willapa Bay to assess the

management's policy impact on the fishing industry

statewide.

So what does the Department do with that?

Following the -- one of the important parts of the

APA process or the rulemaking process is the Concise

Explanatory Statement. And this is just stepping

back generally. The Concise Explanatory Statement is

intended to be a statement by the Department as to

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what their agency action was and how they dealt with

each of the comments, what was the -- you need to

give us some explanation as to why you disregarded

certain comments during the rulemaking process and

that sort of thing. It's kind of an -- it's the --

for lack of a better, it's the intent behind the

rule. It's the agency intent versus the Legislature

intent. It tells us kind of what was the analysis

they went to.

And so for the economic analysis, what you find

was that their sole focus was conservation, that they

didn't really go through an economic analysis. And

they gave some reasons why they didn't go through

that analysis. They said it was challenging. And

this is a -- these are all on Bates Number 52 in the

Concise Explanatory Statement. It says it's not

attainable. And they said, really, some of these

factors are outside of our control.

And that's where I think -- that's where our claim

rises is that they expressly say, you know, this is a

conservation measure. We're going through that

conservation measure, and we're putting economics to

the side, despite the fact that their mandate says

that you must consider the economic impact on the

fishing industry. And I acknowledge that it says

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statewide, commercial and recreational. But if they

don't know that, if they've analyzed some data and

somebody says hey, I, prepared that data, I gave it

to that author, it doesn't really apply here, they

can't rely on it. And in that sense it is arbitrary

and capricious. It disregards what are the facts and

circumstances of this case.

And so taking this back to Puget Sound Harvesters

vs. Department of Fish and Wildlife, it's cursory.

It's just saying, you know, this is hard; we can't do

it; and therefore we're just going to go ahead and go

with our conservation analysis. And I think that's

supported by the statute.

I make an argument in our briefing about the

wording of the statute. It says, the first mandate

is conservation; the second says consistent with that

mandate, you must consider the economic impact. And

based on the legislative amendments, you see that the

language in the economic portion has been amended

once that would suggest that maybe economics and

conservation are equal.

Now, there is a case that says, you know,

conservation is paramount. But I want to distinguish

that case. I believe it's the Puget Sound -- it's

actually another Puget Sound Harvesters case, I

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believe. And the situation in that case is, they

were actually running into the -- there was

significant risk that the fish would be gone, that

they were -- there were serious concerns about

whether or not this fishery was going to continue.

And the court correctly said, you know, you need to

make sure that occurs. Because then if the fish are

gone, there is no economic -- there is no economy.

There's no commercial fishing; there's no

recreational fishing. So that is paramount. You

need to make sure that conservation -- that you

conserve the resources.

Well, here it's a little bit different, because we

have the former Region Six Manager, Ron Warren. And

I submitted a -- there's a declaration in the record

where he basically says in 2013, you know, these

fisheries are abundant; they are healthy; they are

not ESA listing. We just want to change what the --

we're thinking of doing here is just changing our

target. Your know, there's lots of fish — don't

worry about that — plenty of fish. We want a

specific type of fish. We want a fish that is

naturally spawning.

And so when you have the -- when you have at its

core that conservation is actually met, that there's

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actually no risk to -- that there's no -- no risk of

there not being any fish, then you really need to put

economics consistent with that conservation

objective. And so I would say here that, right now,

if they don't consider the economics and they just

don't have any economic objectives, that the data

they used is inaccurate or unreliable, then their

economic analysis is inconsistent with their

conservation analysis.

It doesn't -- there's not -- they have not

promoted to -- they have not sought to maintain the

stability or wellbeing of the fishing industry. And

they just don't know whether they have or not,

because they haven't looked at anything reliable

enough to tell them they have. And so, in that

sense, it is arbitrary and capricious.

Finally -- so with that one, our request for

relief is that 2015 rules are invalid and declare --

and a declaration of -- a declaratory judgment

directing them to engage in a process that does seek

to maintain the stability of the fishing industry by

doing a correct analysis -- a correct economic

analysis.

So going next to our fifth claim for relief, that

claim kind of weaves throughout this as kind of what

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happened. You know, what did the agency do.

Originally, Ron Warren testifies in court and says,

you know, this is a healthy fishery; we're meeting

all of our conservation objectives; this is --

there's no ESA listing. And then the -- and that was

in August of 2013. Suddenly, in March of 2014, a

much different picture is painted. And so the

question then becomes, how much information did you

really have within that six-month period to make such

a drastic change? And you have to have a reasoned

analysis for that.

Now, that's important because as of March of 2014,

they only had season. They had one data point

different than what they had in 2013. Now, they

string a series of -- you know, they have all of

these public meetings, and they try to generate as

much information as they can about that change. But

it was all -- but all of that information they put

together is after the fact. Because, really, they've

already made the decision to change in March of 2014.

And what did they have in March of 2014 that they

didn't have in August of 2013? They have just a

single season. And so we object to that in the sense

that it is just simply inadequate information to do

that.

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I want to move now to, more importantly, these

emergency rules. This is the in-season management

that's kind of what's going on here. Because those

emergency rules did not go through notice and public

comment. For our purposes here, rulemaking generally

has a -- and I'll go back to tab 13 of my key

documents binder. There's -- it's actually kind of a

lengthy process, you know, to go through. There's a

45-day period for public comment. There's another

35-day period before a public hearing on the rule.

Then you issue the rule. And then actually not on

here is after the -- along with the rule being

issued, you filed a Concise Explanatory Statement

justifying why you either disregarded or accepted all

that commentary that you received during that

process, which is kind of the accountability piece.

Because we didn't just -- it didn't fall on deaf

ears. We actually heard it, and this is what we

think about it.

Well, that didn't happen in those emergency rules,

because there's an exception to that process for good

cause. What's the -- and for good cause -- this is

34.05.350.

". . . Good cause finds: That immediate

adoption, amendment, or repeal of a rule is

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necessary for the preservation of the public

health, safety, or general welfare, and observing

the time requirements of notice and opportunity

to comment upon adoption of a permanent rule would be

contrary to public interest."

So that's been subsequently interpreted in the

case of State v. MacKenzie. And that case has some

very interesting language about what good cause

means. And it says you need to have a real

emergency. In that case, the regulation didn't have

adequate -- it wasn't adequately written, so that

blood alcohol tests could be admitted in court, so

that people could potentially not be prosecuted for

driving under the influence. That's a serious risk.

That's a serious emergency there that needs to --

then they immediately go back, because they have all

of these cases that are coming up in the -- all of

these DUI cases that are moving through. We need to

amend that regulation. We can't wait three months to

go through a public comment period. This was

intended to be there in the first place, and we need

to do it now.

You also have a similar standard at the federal

level. And I want to point out, Washington's APA

does say that courts should look to federal authority

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so that they're interpreted consistently with each

other, the federal and the State APA. So I cite

to -- in our brief to NRDC vs. Evans. And that's a

fisheries case.

In that case they were issuing emergency rules

based on fluctuating information about the fishery.

And they were having trouble collecting all of the

data, and they wanted to change their approach more

quickly than the APA process and public notice and

public comment would allow. And the court there

said, I understand what you're trying to do, that

makes sense, but generic complexities of data

compilation and the timing are not sufficient

exigency. That is not an exigent circumstance.

That is exactly what you have here. In response

to our petition, the Department of Fish and Wildlife

states very specifically, "Here the emergent

circumstance was the need to respond to new fishery

data within a narrow window."

And that is the generic complexities of timing

that are rejected in NRDC vs. Evans. You need to

have a real -- what is the real risk.

Now, they're going to point to, oh, we were at a

risk of missing that objective that we outlined in

the policy, that 20 percent harvest rate. Well, they

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had gone for years with a much higher percent on the

fishery. And the fish -- over those years, the fish

were abundant. They were healthy. There was no ESA

listing.

I think if there's a real risk of overfishing,

that we're going to deplete this to nonexistence on

this season, this particular moment -- because if

they're looking at subsequent seasons, that's outside

the scope. I mean, they need to go through regular

notice and comment. I mean, okay, we're going to --

this is an impact that's going to -- the fishing this

year is going to impact future seasons, or we want to

limit the scope of fishing every year in this manner,

then that's a different issue. This is -- we're

looking at the fisheries data or the data from

fishing this season, and this season we have a risk

that these fish are going to be depleted

significantly to nonexistence. Then we have a real

emergency, and then you issue the emergency

regulation.

Simply not being able to gather new data --

they're accepting new data as the season progresses,

and they can't adjust the fishery in a way that they

would like to in that time period, that's exactly the

type of sort of complexities in data compilation

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that's just not good cause, and that is why the

emergency regulations are arbitrary and capricious

and should be invalidated.

I think a declaratory judgment in that sense would

direct a them to go through a good cause analysis of

what is an actual emergency, but I think more

importantly, that generic complexities and data

compilation and timing are not good cause and

invalidating those 2015 emergency regulations

accordingly.

I want to just briefly touch again on the motion

to dismiss, the first two claims. The motion to

dismiss, the first two claims, is based on collateral

estoppel, res judicata. It is not a challenge to the

justiciability of this action. It is simply saying

that we already litigated this issue. And that has

categorically been rejected in Ullery vs. Fullerton.

Threshold justiciability issues are not decisions on

the merits -- final decisions on the merits, and

therefore, they are not subject to collateral

estoppel or res judicata.

I also want to point out, they're just different

issues. We attacked the policy directly in Pacific

County; our petition says that. Our agency action

was the policy. We were seeking to invalidate the

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policy. Here we are seeking to invalidate the rules,

because the process was not sufficient.

Our direct attack on the policy would have been --

I mean, that would have been one -- that was

strategically an advantageous approach. We did not

prevail. So we went here to attack the rule. And we

did attack the rule.

Now, the State points out that the rule had been

issued at the time of that decision and that it was

supplemented for the court. And it was. That

doesn't mean that didn't alter the petition, because

the only way we know what the issues and the claims

were in that original case is, what was the petition

containing. The petition at that time was not

challenging those rules.

I hadn't even seen -- I mean, I had seen them, but

it was like three or four days before the hearing.

The briefing was -- to my recollection the briefing

had been done. But besides that, we were challenging

policy directly, and that is a different issue. And

again, the issue there for issue preclusion and the

element at issue is, what is the narrow issue

litigated.

The narrow issue litigated was justiciability, not

the merits of all of the claims. In fact, that's

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what the court decided in the order is that it was

not justiciable and then dismissed the whole

complaint, didn't deal with the arbitrary and

capricious claims, didn't deal with any of the other

claims, didn't deal with anything. It just said, you

know, you're just -- you're premature.

In Ullery vs. Fullerton — I think I'm pronouncing

that correctly — quoting the -- in a quote it

actually references "immature claims." It says one

of the things that is -- that applies or that is a

justiciability determination that is not subject to

collateral estoppel or res judicata is a claim that's

not mature. And that is exactly what happened here.

It has subsequently matured, and we filed a new

petition based on that maturity. And so I think that

the motion should be denied on that basis.

Oh, and then there's the -- finally, I -- and

before I jump into the judicial estoppel argument, I

have dealt with Mike Grossman for four years. I

think he's an excellent lawyer. I'm not doing this

to throw him under the proverbial bus. I'm just

saying, he made an argument before the court,

basically, that they could do anything they wanted to

do in a rule challenge in Thurston County. That's

clearly in the record, and that's what was adopted by

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the court. And now we're here in Thurston County

saying, yeah, you can't come to Thurston County.

That is by a -- I think that is judicial estoppel,

and I think they should be estopped.

There's an equitable component to -- if you read

all of the cases, it's kind of an equitable analysis

for collateral estoppel and res judicata. It's,

really, what do -- how do we retain the -- constrain

the flow on the courts, and we don't need to keep

relitigating the issues that have already been

decided.

So with that equitable component, I think there's

a matter of equity in whether or not it is

appropriate to apply. And I think that piece of it

makes it inequitable to apply here, even if you

determine that there was a final judgment, even if

you determine that the issues were the same, which I

don't think the -- I think you could deny that motion

on both of those grounds. In addition to that,

there's this equitable components that makes it

inappropriate here. So I think the motion should be

denied.

THE COURT: Thank you.

Mr. Grossman.

MR. GROSSMAN: Good afternoon, Judge Dixon.

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THE COURT: Good afternoon.

MR. GROSSMAN: For the record, Mike Grossman

representing the State of Washington Department of

Fish and Wildlife.

I'll briefly go through the motion to dismiss, and

then I'll pivot pretty quickly into the two claims

and the merits for those claims, assuming that we're

going to resolve the issue of the motion to dismiss,

perhaps, after we've litigated everything today.

Our position is that there -- collateral estoppel

and res judicata do apply. The elements are issues

identical to the prior litigation, a prior final

judgment, the parties in privity, and application of

collateral estoppel wouldn't work a prejudice or an

injustice.

Here there are identical issues and claims in the

first two claims. The response from the Petitioners

didn't even try to distinguish the nature of the

claims. The essence is to say you can't, commission,

do policies that are specific and that have time,

place, and manner kinds of prescriptions.

And I think we heard today from Mr. Godwin that

the relief they seek is an order from this court

saying that staff, you can ignore the policy, because

policies can't have that kind of stuff in it, and

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they can't have mandatory language. And there's also

a claim that the end of the policy which says this is

strong guidance, and you can set that aside if you

need to; you just need to come back and talk to that;

ignore that; that was somehow just some sort of head

fake that the commission put in there.

The point is that in Pacific County, just like in

Sudar, they came to the court and said, the agency

did something unlawful when it adopted policies that

had strong guidance, used the words "shall"

or "will," and set a strong path forward. Well,

that's what the folks in Sudar tried down in the

Columbia River in a policy that's very similar to the

Willapa policy, and they lost on it.

And that's what the gillnetters tried to do in

Pacific County, and Judge Sullivan said, no, I think

this is an effort to try and go after the policy as

unlawful rulemaking. It's not a rule. It doesn't

have mandatory effect. And just like what the court

said in Sudar, that is now a Court of Appeals

decision, and I'm bound by it. And he dismissed

their case.

THE COURT: Well, what about the argument that

the sole issue or the sole decision reached in

Pacific County was the issue of justiciability?

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MR. GROSSMAN: It is -- the issue was, is

policymaking a justiciable controversy under the APA.

And Sudar says clearly, it is not. And that's the

basis on which Judge Sullivan dismissed their claim

in Pacific County.

Now, Mr. Godwin says, well, take a look at Ullery.

Ullery says, if you've got justiciability issues and

that's what makes it go away, then you haven't met

the part of collateral estoppel, res judicata, that

says you have a full litigation of the issues and a

judgment. But if you look -- but it doesn't actually

say "justiciability."

The Ullery case says, when cases are dismissed

based on prudential issues, things like failure to

join a party, lack of standing, wrong venue, things

that are curable, then you haven't had an

adjudication of the claim or issue that's a part of

what you want to get to litigate.

Well, they've told you what the heart of the issue

is that they want to get at here on the policy. They

want you to conclude that the commission has no

lawful authority to develop policies that have a

strong component to it and that set a presumptive

path forward and that have things in it that look

like time, place, and manner components that

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eventually make their way into a rule.

But the Sudar case took that issue head on. And

if you take a look at Sudar — I cited to it in our

brief — starting at page 33, they say, "no

justiciable controversy may be alleged." It's not

that a -- there's nothing to cure here. The

question -- if what you're going to do as a litigant

is say there's agency action when you do policymaking

that I can create a controversy or allege a

controversy over and bring that to the court for

judicial review, that's what Sudar said you can't do.

And that's what they tried to do in Pacific County;

that's what their first two claims here have tried to

do.

So our position is, this meets all of the tests

for what is a preexisting claim or issue that was

pled, that was examined by the court as a matter of

law, and that was then resolved to a conclusion. And

here you have Judge Sullivan saying in his order, you

can't raise this issue. He doesn't say this is a

prudential issue. He says policymaking is not a

justiciable controversy. Now, I --

THE COURT: What about challenging the policy?

In that case Mr. Godwin argues that the challenge in

the instant case is a challenge to the rule.

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MR. GROSSMAN: Ultimately, they want to

challenge the rule, but how do they get to the

challenge to the rule? By getting you to go back to

the policy --

THE COURT: All right.

MR. GROSSMAN: -- and say you can't -- I mean,

look at the relief he asked you for today. And in

fact, if you take a look at paragraphs 4.7 and 5.7 of

their Amended Petition for Review, or paragraph 2 on

the last page that asks for the relief, what do they

say? They say you can't have policies that have

these time, place, and manner components.

And what they say on the last page of their

in the superior court of the state of washington...

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