December 14, 2012 — The Department of Commerce has released a redacted version of the special master, Judge Charles B. Swartwood, III (ret.) concerning applications of review of NOAA enforcement actions.
The following paragraphs are excerpted from the report.
Several of the Enforcement Attorneys have argued that in the review process “basic tenets of judicial review should apply” and that review of Agency action must be based solely on the administrative record. (Case 206: Response by EA Deirdre Casey, p. 2.) Enforcement Attorney Charles Juliand echoes this assertion when he complains that this investigation involves “subjective determinations by a person or persons unfamiliar with the process who seem to rely more heavily on ex parte communications from interested parties than upon an analysis of substantive rights in light of established law and policy.” (Case 228: Response by EA Charles Juliand, pp. 1-2.) I disagree with these assertions. This investigation does not involve judicial review. It is an investigation of complaints about an abuse of process. In order to investigate a complaint, it is necessary to interview the complainant. Additionally, all NOAA personnel involved in a case have been given ample opportunity to respond to an applicant’s complaint. In some cases, those responses have been lengthy and are usually supported by referenced exhibits.
The Enforcement Attorneys further argue that complainants are bound by their settlement agreement and that those agreements cannot be set aside except for fraud or duress. (Case 206: Response by Deirdre Casey, p. 2.) EA Casey cites to civil case authority for this proposition of contract law. However, this review is an equitable proceeding based on fundamental fairness and common sense and is not subject to either the rigid confines of judicial review or traditional concepts of common law. The best example of a similar Executive prerogative is the authority of the President to grant a pardon. It is a permitted discretionary action not subject to any particular or existing standard and not subject to review. Additionally, this review is part of an inquiry by the Secretary of Commerce concerning enforcement practices within NOAA. As such, it is an Executive Branch function not governed by principles applicable to Judicial Branch proceedings.
In the Conclusion to my April 2011 Report, I noted a pattern by Enforcement Attorneys (EAs) of assessing high monetary penalties in a manner that unfairly forced settlement. Report and Recommendation of the Special Master concerning NOAA Enforcement Action of Certain Designated Cases (Apr. 2011). I have seen that same pattern emerge in reviewing the cases included in this Report and in some instances have recommended relief because of that procedure. The EAs argue that if the fishermen, vessel owners or fish dealers believed that the penalty assessment and/or proffered settlement was excessive, they had the option to appeal their cases to a Coast Guard ALJ. As pointed out in my previous Report and confirmed by every fisherman, vessel owner, fish dealer and lawyer interviewed for this Report, there was a universal perception that a Coast Guard ALJ, after hearing, would affirm both liability for the alleged violation and the originally assessed penalty. Therefore, every fisherman, vessel owner and fish dealer that was faced with an excessive penalty assessment was willing to accept a proffered settlement for a base amount, even if that amount was excessive because of the perceived likelihood that the original excessive assessment would be affirmed if appealed to a Coast Guard ALJ. This perception and the ability of NOAA Enforcement Attorneys to seize the catch and impose a substantial permit sanction gave EAs a substantial advantage in settlement negotiations and enabled them in certain cases to force unfair settlements.
I have recommended relief in several cases where an excessive penalty assessment led to an unfair settlement. However, there are also cases where I have found the penalty assessment to be excessive, but that the resulting settlement was fair. Therefore, the determining factor has been not the original assessment but rather the resulting settlement.