Filed: Aug. 30, 2013
Latest Update: Mar. 28, 2017
Summary: NOT PRECEDENTIAL UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT _ No. 12-4018 _ PIONEER AGGREGATES, INC.; THE FAMOUS BRANDS, INC., dba Simpson Solutions, Appellants v. THE PENNSYLVANIA DEPARTMENT OF ENVIRONMENTAL PROTECTION; JOHN HANGER, in his individual and official capacity; KEITH BRADY, in his individual and official capacity; THOMAS CALLAHAN, in his individual and official capacity; NATHAN HOUTZ, in his individual and official capacity; MICHAEL MENGHINI, in his individual and official
Summary: NOT PRECEDENTIAL UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT _ No. 12-4018 _ PIONEER AGGREGATES, INC.; THE FAMOUS BRANDS, INC., dba Simpson Solutions, Appellants v. THE PENNSYLVANIA DEPARTMENT OF ENVIRONMENTAL PROTECTION; JOHN HANGER, in his individual and official capacity; KEITH BRADY, in his individual and official capacity; THOMAS CALLAHAN, in his individual and official capacity; NATHAN HOUTZ, in his individual and official capacity; MICHAEL MENGHINI, in his individual and official ..
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NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
_____________
No. 12-4018
_____________
PIONEER AGGREGATES, INC.; THE FAMOUS BRANDS, INC., dba Simpson
Solutions,
Appellants
v.
THE PENNSYLVANIA DEPARTMENT OF ENVIRONMENTAL PROTECTION;
JOHN HANGER, in his individual and official capacity;
KEITH BRADY, in his individual and official capacity; THOMAS CALLAHAN, in his
individual and official capacity;
NATHAN HOUTZ, in his individual and official capacity; MICHAEL MENGHINI, in
his individual and official capacity;
MICHAEL KUTNEY, in his individual and official capacity
____________
On Appeal from the United States District Court
for the Middle District of Pennsylvania
(No. 3-11-cv-00325)
District Judge: Hon. Robert D. Mariani
Submitted Pursuant to Third Circuit LAR 34.1(a)
June 27, 2013
Before: FUENTES, FISHER, and CHAGARES, Circuit Judges.
(Filed: August 30, 2013)
____________
OPINION
____________
CHAGARES, Circuit Judge.
Pioneer Aggregates, Inc. (“Pioneer”) and Simpson Solutions (“Simpson”) filed a
lawsuit against the Pennsylvania Department of Environmental Protection (“PADEP”)
and individual defendants (collectively, the “defendants”) for the alleged violation of
various constitutional rights that Pioneer and Simpson claim to have suffered when the
defendants denied their request to use out-of-state clean-fill material to reclaim Pioneer’s
active mines in Pennsylvania. For the reasons articulated below, we will affirm.
I.
Pioneer is a mining company that owns and operates a non-coal quarry in Laflin,
Pennsylvania (the “Laflin Quarry”). Pioneer joined with Simpson, a New Jersey
company, to reclaim Pioneer’s Laflin Quarry by disposing of clean fill there. Fill is
“clean” if it is composed of materials designated permissible and falls at or below
specified contaminant levels. Pioneer and Simpson’s deal involved identifying, securing,
and transporting fill to Pioneer’s Pennsylvania mines for disposal. In order to use the fill
to reclaim the Laflin Quarry, Pioneer requested that the defendants revise Pioneer’s
mining permit to allow for the use of clean fill for reclamation. The Bureau of District
Mining Operations (the “Mining Bureau”), a division of the office of Active and
Abandoned Mine Operations, granted the revised permit on the condition that Pioneer
satisfy existing clean-fill guidelines.
Pioneer and Simpson (collectively, the “plaintiffs”) claim that the Bureau of Waste
Management (the “Waste Bureau”) “directs and administers the statewide waste
programs,” promulgating the Solid Waste Management Act (the “Waste Act”) and
2
regulations relating to disposal of fill. Pioneer Br. 12. The plaintiffs argue before this
Court, as they alleged in their Complaint, that it is the Waste Bureau that “has authority
to control the properties of fill material and its use” under the Waste Act. Appendix
(“App.”) 21. However, the plaintiffs contend, the Mining Bureau “circumvented [its]
lack of authority by drafting and imposing [its] own clean fill standard for active mine
reclamation.” Pioneer Br. 11.1 This standard (the “Mining Standard”) bears some
similarity to the standard promulgated by the Waste Bureau (the “Waste Standard”) but,
the plaintiffs claim, the Mining Standard’s requirements are more stringent. Specifically,
under the Mining Standard, incidental mine reclamation clean fill, which is 750 tons of
clean fill a year or less, “may not originate from an out-of-state source because of
PADEP’s limited ability to inspect and evaluate out-of-state source areas.” App. 18.
Furthermore, the plaintiffs allege that the defendants “stated unequivocally that they were
not going to inspect fill material outside of Pennsylvania due to significant staffing
shortages,” and that they could not approve any projects for which the fill material had
not been inspected. Id. 34. Therefore, the plaintiffs argue, “Defendants acknowledged a
policy of arbitrarily rejecting out-of-state fill.” Pioneer Br. 16.
In September 2008, Pioneer applied to use clean fill from a construction project in
New York to reclaim the Laflin Quarry. The plaintiffs identified the construction of a
1
The plaintiffs elsewhere explain that the Waste Bureau has jurisdiction over inactive
mines and applies the Waste Standard. Pioneer Br. 12. By contrast, “[t]he Mining
Bureau administers the regulatory programs for all mining activities and has jurisdiction
over reclamation activities in active and abandoned mines.” Id. 11. Although Pioneer
does not so specify, we assume based on the other facts alleged that Pioneer’s Laflin
Quarry is active.
3
new Willis Avenue Bridge, which connects the New York City boroughs of Manhattan
and the Bronx, as the source of 4,500 tons of clean fill they wished to place above the
water table at Laflin Quarry. The plaintiffs allege that they extensively tested the fill at
the Willis Avenue Bridge project (the “WABP”) and determined that it was clean under
the Waste Standard. However, on November 26, 2008, the plaintiffs received a
deficiency letter from the PADEP explaining that the Mining Bureau had developed its
own draft standard — the Mining Standard — with which the plaintiffs had failed to
comply.
The plaintiffs claim that they were completely unaware of the existence of the
Mining Standard because it was never adopted or distributed by the PADEP, but they
nevertheless responded to the PADEP letter by addressing the identified deficiencies with
the WABP fill. Still, on February 27, 2009, the PADEP denied Pioneer’s Source
Approval Request because the proposed WABP fill “does not meet the definition of clean
fill,” as “[s]oil and groundwater at the source site are extensively contaminated with
metals and petroleum hydrocarbons,” such that “[i]t cannot be proven or determined with
any real certainty that the material to be placed on the mining permit is uncontaminated.”
App. 52. The letter went on to inform Pioneer of its right to appeal that determination to
the Environmental Hearing Board (the “EHB”).
Pioneer initiated the appeals process with the EHB but moved to discontinue the
appeal when it learned that its challenge was moot because the WABP fill had already
been moved. Specifically, Pioneer alleges that 110,000 tons of the same WABP fill was
permitted to be deposited in a different Pennsylvania mine in Coplay, Pennsylvania. The
4
Coplay Quarry is seventy miles from the Laflin Quarry, and has parts that are both
inactive and active. Coplay’s request to reclaim the inactive part of the Coplay Quarry
with fill from the WABP was governed by the Waste Bureau. The Waste Bureau found
that the WABP fill met its standards for “clean fill,” and approved Coplay’s request.
The plaintiffs allege that, because the Waste Standard and Mining Standard
employ the same requirement for clean fill located above the groundwater table, and
because the Coplay Quarry and the Laflin Quarry are both above the groundwater table,
the same standard for clean fill was applied to the WABP in considering Pioneer’s
request as was applied to Coplay’s request — but with the opposite result. The plaintiffs’
constitutional claims arise from the denial of their request to reclaim the Laflin Quarry
using the WABP fill, particularly in light of the allegedly disparate treatment afforded
Coplay. Realizing that Coplay had capitalized on the WABP opportunity, the plaintiffs
submitted applications for disposal of clean fill from other out-of-state sources at Laflin
Quarry, but they contend that the PADEP never responded. Accordingly, Pioneer
abandoned its plans to reclaim the Laflin Quarry through disposal of fill, and instead
reclaimed its mines by a costlier process — the sloping method.
The plaintiffs raised constitutional claims under the Commerce Clause, Equal
Protection Clause, and Due Process Clause through their suit under 42 U.S.C. § 1983.
The District Court held that the PADEP, a state agency, is immune from suit for damages
pursuant to the Eleventh Amendment and has not waived its sovereign immunity.
Moreover, the District Court ruled, the individually named PADEP defendants sued in
their official capacities (John Hanger, Keith Brady, Thomas Callahan, Nathan Houtz,
5
Michael Menghini, and Michael Kutney), are also immune from suit for damages
pursuant to the Eleventh Amendment,2 and defendant John Hanger was dismissed
because he was impermissibly sued under § 1983 on a theory of respondeat superior. The
plaintiffs have not challenged these rulings.
The District Court dismissed the rest of the plaintiffs’ constitutional claims
because it held that the agency defendants in their individual (non-official) capacities are
entitled to qualified immunity because the plaintiffs’ complaint asserted no violation of a
clearly established right (or any right). On dismissing these claims, the District Court
declined to exercise supplemental jurisdiction over the plaintiffs’ remaining state-law
claim. The plaintiffs timely appealed.
II.
The District Court had jurisdiction over this matter under 28 U.S.C. § 1331 and
this Court has jurisdiction pursuant to 28 U.S.C. § 1291. We exercise plenary review
over the District Court’s grant of the defendants’ motion to dismiss. Fowler v. UPMC
Shadyside, 578 F.3d 203, 206 (3d Cir. 2009). In so doing, “[w]e take as true all the
factual allegations of the [complaint] and the reasonable inferences that can be drawn
from them, . . . but we disregard legal conclusions and recitals of the elements of a cause
of action, supported by mere conclusory statements.” Santiago v. Warminster Twp.,
629
F.3d 121, 128 (3d Cir. 2010) (quotation marks omitted). “[W]hen the plaintiff pleads
factual content that allows the court to draw the reasonable inference that the defendant is
2
The District Court held that the defendants in their official capacities are not immune
from suit for injunctive relief.
6
liable for the misconduct alleged,” the claim has “facial plausibility” and the complaint
will survive a defendant’s motion to dismiss. Ashcroft v. Iqbal, 556 U.S. 662, 678
(2009). Furthermore, “[w]e review the district court’s grant of qualified immunity de
novo as it raises a purely legal issue.” Burns v. Pa. Dep’t of Corr.,
642 F.3d 163, 170 (3d
Cir. 2011). We review a district court’s denial of a motion for leave to amend the
complaint for abuse of discretion. In re Burlington Coat Factory Sec. Litig.,
114 F.3d
1410, 1434 (3d Cir. 1997).
III.
A.
The plaintiffs allege that the defendants violated their rights under the Dormant
Commerce Clause — that is, the “negative aspect” of the Commerce Clause that “limits
the states’ power to regulate interstate commerce.” Cloverland-Green Spring Dairies,
Inc. v. Pa. Milk Mktg. Bd. (“Cloverland I”), 298 F.3d 201, 210 (3d Cir. 2002); see also
U.S. Const., art. I, § 8, cl. 3. Specifically, the plaintiffs argue that the defendants’ Mining
Standard violates the Dormant Commerce Clause because it treats clean fill located out of
state differently from in-state clean fill. The plaintiffs base this argument on the
defendants’ denial of Pioneer’s application to use the WABP fill at the Laflin Quarry
because, the plaintiffs allege, although the defendants “admitted the WABP fill was
‘clean,’ . . . they denied the Application . . . because they refuse to travel out-of-state to
inspect fill sources, and they do not approve sources they cannot inspect.” Pioneer Br.
23.
7
The Dormant Commerce Clause is violated when a state “impos[es] restrictions
that benefit in-state economic interests at out-of-state interests’ expense.” Cloverland I,
298 F.3d at 210. “The initial question in a dormant Commerce Clause case is whether the
state regulation at issue discriminates against interstate commerce either on its face or in
practical effect.” Id. (quotation marks omitted). “If so, heightened scrutiny applies.” Id.
“[I]f not, then [the court] considers whether the law is invalid under the . . . balancing
test” promulgated by the Supreme Court in Pike v. Bruce Church, Inc., 397 U.S. 137
(1970). Cloverland-Green Spring Dairies, Inc. v. Pa. Milk Mktg. Bd. (“Cloverland II”),
462 F.3d 249, 261 (3d Cir. 2006).
Given this framework, our analysis begins with the question of whether the state
regulation at issue — the Mining Standard — discriminates in purpose or effect against
interstate commerce. This Court has identified two situations wherein discrimination
triggering heightened scrutiny will be found: (1) where the extraterritorial effects of a
challenged regulation adversely affect economic production in other states; and (2) where
the object of the challenged regulation is “local economic protectionism.” Id. at 261-62.
In City of Philadelphia v. New Jersey, the Supreme Court deemed discriminatory a New
Jersey law that prohibited the importation into New Jersey of waste generated outside of
the state, holding that such a prohibition “imposes on out-of-state commercial interests
the full burden of conserving the State’s remaining landfill space.” 437 U.S. 617, 628
(1978). The Court held that even a state’s legitimate purpose for enacting a regulation
“may not be accomplished by discriminating against articles of commerce coming from
outside the State unless there is some reason, apart from their origin, to treat them
8
differently.” Id. at 626-27. “What is crucial is the attempt by one State to isolate itself
from a problem common to many by erecting a barrier against the movement of interstate
trade.” Id. at 628.
This Court has acknowledged that, in the context of the Dormant Commerce
Clause, “‘discrimination’ simply means differential treatment of in-state and out-of-state
economic interests that benefits the former and burdens the latter.” Lebanon Farms
Disposal, Inc. v. Cnty. of Lebanon, 538 F.3d 241, 248 (3d Cir. 2008) (quotation marks
omitted). In the instant case, the plaintiffs allege in their Complaint that the “Defendants
were not ‘comfortable’ approving . . . anything that they could not physically inspect,”
and that the “Defendants stated unequivocally that they were not going to inspect fill
material outside of Pennsylvania due to significant staffing shortages.” App. 34. Thus
the plaintiffs have sufficiently alleged that the Mining Bureau’s source fill application
process treats out-of-state fill differently from in-state fill because it does not afford out-
of-state fill the chance to be approved. That is, they have properly alleged that the
Mining Standard treats commerce from outside of Pennsylvania differently for no reason
other than the commerce’s out-of-state origin.
Once a plaintiff has demonstrated the existence of such discrimination, we apply
the heightened scrutiny standard and “the burden then shifts to the state to prove that ‘the
statute serves a legitimate local purpose, and that this purpose could not be served as well
by available nondiscriminatory means.’” Cloverland II, 462 F.3d at 261 (quoting Maine
v. Taylor, 477 U.S. 131, 138 (1986)). Because the defendants point to a legitimate local
purpose — namely, the need to have the proposed fill inspected by PADEP officials, who
9
are located in Pennsylvania — we hold that the defendants have satisfied their burden in
this case.
B.
The plaintiffs also allege that the defendants violated their rights pursuant to the
Equal Protection Clause of the Fourteenth Amendment under three different theories:
first, that the plaintiffs were treated differently from other active mine operators; second,
that they, as active mine operators, were subject to a more burdensome standard for mine
reclamation by fill than operators of inactive mines; and third, that the defendants
inconsistently and arbitrarily applied their standards to treat Pioneer and Simpson
differently from Coplay, though they are similarly situated.
To state an equal protection claim under such a “class of one” theory, the plaintiffs
must allege that they were “intentionally treated differently from others similarly situated
by the defendant and that there was no rational basis for such treatment.” Phillips v.
Cnty. of Allegheny, 515 F.3d 224, 243 (3d Cir. 2008). The District Court held that the
plaintiffs failed to make out an equal protection claim because they did not sufficiently
allege that Pioneer is similarly situated to any party treated differently. The District
Court acknowledged that the plaintiffs claimed that Pioneer is similarly situated both to
Coplay, which was permitted to reclaim the Coplay Quarry with WABP fill, and Glenn
Hawbaker, Inc., whose reclamation was approved by the Moshannon District Mining
Office on the condition that the clean fill used there comply with the less stringent Waste
Standard, rather than the Mining Standard that Pioneer was required to follow. App. 20.
As to the latter, we agree with the District Court that the plaintiffs’ Complaint failed to
10
allege sufficiently that Pioneer is similarly situated to Glenn Hawbaker, Inc., a fact that
the plaintiffs acknowledge before this Court on appeal. See Pioneer Br. 45 (“Even if
Plaintiffs were not specific or clear enough as to how Pioneer and Glenn Hawbaker are
similarly situated, the above discussion demonstrates that they are . . . .”).
We also hold that Pioneer has failed to establish that it is similarly situated to
Coplay. The District Court lucidly explained that the PADEP recognizes a distinct
statutory scheme for the regulation of active versus inactive mines. Moreover, the
PADEP has “extensive discretion in enforcing state environmental protection laws,” and
it is authorized by Pennsylvania statute “to regulate reclamation at active mine sites.”
App. 345. Pioneer’s Laflin Quarry is at least partly an active mine, while the Coplay
Quarry is an inactive mine. Accordingly, the District Court held that Pioneer and Coplay
are not similarly situated. Even if they were, the District Court explained, a rational basis
existed for the PADEP to distinguish between them since the defendants “gave Plaintiffs
specific reasons as to why the clean fill at the WABP did not meet the regulatory
requirements.” Id. We agree, and therefore will affirm the District Court’s denial of
Pioneer’s challenge on equal protection grounds.
C.
We consider, finally, the District Court’s dismissal of the plaintiffs’ claim that the
defendants violated their rights to substantive and procedural due process. We address
each in turn.
Pioneer and Simpson allege that the defendants violated their substantive due
process rights under both of the “two very different threads” identified by this Court as
11
part of the “fabric of substantive due process . . . woven by our courts” — that is,
substantive due process relating to legislative action and substantive due process relating
to non-legislative or executive acts. Nicholas v. Pa. State Univ., 227 F.3d 133, 139 (3d
Cir. 2000). The District Court held that the plaintiffs cannot make out a claim of
violation of their substantive due process rights under the “legislative act” thread because
one of the plaintiffs’ principal allegations is that the Mining Standard “has never been
promulgated pursuant to Pennsylvania’s formal rulemaking or policymaking procedures.”
App. 19. Accordingly, the District Court held, “the allegations in Plaintiffs’ Complaint
admit that the Mining Clean Fill standard [the Mining Standard] is a non-legislative,
executive action.” Id. 319. As the plaintiffs point out, however, we have located “the
distinction between legislative acts and non-legislative or executive acts” in the fact that
“executive acts, such as employment decisions, typically apply to . . . a limited number of
persons, while legislative acts, generally laws and broad executive regulations, apply to
large segments of society.” Nicholas, 227 F.3d at 139 n.1 (quotation marks and
alterations omitted). The fact that Pioneer and Simpson challenge the Mining Bureau’s
ability to promulgate its own standard does not mean that the standard’s application,
which affects a large segment of society, fails to qualify as a legislative or regulatory act.
Indeed, the Mining Standard is applied precisely for the purpose of regulating the way in
which a mining company may reclaim its mine.
We hold, nevertheless, that there is no substantive due process violation as to the
legislative thread. “[A] legislative act will withstand substantive due process challenge if
the government identifies a legitimate state interest that the legislature could rationally
12
conclude was served by the statute.” Id. at 139 (quotation marks omitted). In our view,
the legitimate state interest supporting the Mining Standard is the PADEP’s interest in
protecting the environment from contamination due to fill that is not “clean.”
As for the other thread of our substantive due process inquiry, “[t]o prevail on a
non-legislative substantive due process claim, a plaintiff must establish as a threshold
matter that he has a protected property interest to which the Fourteenth Amendment’s due
process protection applies,” which requires a showing that the interest is of a “particular
quality” that is “fundamental under the United States Constitution.” Id. at 139-40
(quotation marks omitted). Even if the state action complained of here were the kind of
“intentional and unjustifiable” interference with “[t]he right to pursue a lawful business
or occupation” that this Court has held to be a protected right, Small v. United States, 333
F.2d 702, 704 (3d Cir. 1964), nevertheless the conduct of the defendants is not “so
egregious, so outrageous, that it may fairly be said to shock the contemporary
conscience,” Kaucher v. Cnty. of Bucks,
455 F.3d 418, 425 (3d Cir. 2006) (quotation
marks omitted). This Court has acknowledged in the land-use context that setting a high
standard for non-legislative substantive due process violations “prevents us from being
cast in the role of a zoning board of appeals.” United Artists Theatre Cir., Inc. v. Twp. of
Warrington, Pa.,
316 F.3d 392, 402 (3d. Cir. 2003) (quotation marks omitted).
Specifically, we acknowledged that matters of “local concern” such as land-use decisions
“should not be transformed into substantive due process claims based only on allegations
that government officials acted with ‘improper’ motives.” Id. Accordingly, we will
affirm the District Court’s finding that because the plaintiffs have not sufficiently alleged
13
that the defendants violated their clearly established substantive due process rights, the
defendants are entitled to qualified immunity on this claim.
We further hold that Pioneer has not stated a claim for relief that the defendants
violated its procedural due process rights. The plaintiffs allege that the defendants
contravened the requirements of procedural due process by failing to give Pioneer notice
and opportunity to be heard in advance of the significant deprivations of liberty and
property that the defendants allegedly committed. “A procedural due process claim is
subject to a two-stage inquiry: (1) whether the plaintiff has a property interest protected
by procedural due process, and (2) what procedures constitute due process of law.”
Schmidt v. Creedon, 639 F.3d 587, 595 (3d Cir. 2011) (quotation marks omitted).
Although the Supreme Court “consistently has held that some form of hearing is required
before an individual is finally deprived of a property interest,” nevertheless the Supreme
Court has acknowledged that due process does not always “require[] an evidentiary
hearing prior to the deprivation of some type of property interest.” Mathews v. Eldridge,
424 U.S. 319, 333 (1976). In order to identify “the specific dictates of due process” in a
given context, courts must consider the following three factors:
First, the private interest that will be affected by the official action; second,
the risk of an erroneous deprivation of such interest through the procedures
used, and the probable value, if any, of additional or substitute procedural
safeguards; and finally, the Government’s interest, including the function
involved and the fiscal and administrative burdens that the additional or
substitute procedural requirement would entail.
Id. at 335.
14
The private interest affected by official action in the instant case is Pioneer’s
ability to use its surface mining permit to reclaim the Laflin Quarry. However, despite
this interest, we hold that the final factor of the Mathews test, the government’s interest,
weighs against requiring a hearing in every case where an application for clean source fill
like Pioneer’s was made. Furthermore, the availability of review of the Mining Bureau’s
determination before the EHB satisfies the requirements of procedural due process. As
the District Court correctly pointed out, we have held that “when a state affords a full
judicial mechanism with which to challenge the administrative decision in question, the
state provides adequate procedural due process.” DeBlasio v. Zoning Bd. of Adjustment
for Twp. of W. Amwell, 53 F.3d 592, 597 (3d Cir. 1995) (quotation marks omitted),
abrogated on other grounds by United Artists, 316 F.3d at 392. Although Pioneer notes
that it would not have been able to obtain damages pursuant to the procedures of the
EHB, the Supreme Court has held that even where “state remedies may not provide the
respondent with all the relief which may have been available if he could have proceeded
under § 1983, that does not mean that the state remedies are not adequate to satisfy the
requirements of due process.” Parratt v. Taylor,
451 U.S. 527, 544 (1981), overruled on
other grounds by Daniels v. Williams,
474 U.S. 327 (1986). Therefore, we hold that
Pioneer has not adequately made out its claim that the defendants violated its procedural
due process claim.
D.
The plaintiffs also seek our review of the District Court’s denial of its motion for
leave to amend the complaint. A district court does not abuse its discretion when
15
amendment of the complaint would be futile. In re Burlington Coat Factory, 114 F.3d at
1434. Because we hold that “pleading deficiencies would not have been remedied by
proposed amendments” in this case, we will affirm the District Court’s denial of the
plaintiffs’ motion for leave to amend the complaint.. Kanter v. Barella, 489 F.3d 170,
181 (3d Cir. 2007).
IV.
For the foregoing reasons, we will affirm the order of the District Court.
16
