We thought this fellow has "authority over all fish."
By statute (the Magnuson-Stevens Act), the feds claim the sovereign right to exclusive fishery management and "authority over all fish" in the U.S. Exclusive Economic Zone, a zone "extending 200 nautical miles from the baseline[.]"
The question facing the U.S. Court of Appeals for the Federal Circuit in Fisherman's Finest, Inc. v. United States, No. 21-2326 (Feb. 8, 2023) was whether having licensed via regulation quota-based access to, and commercial fishing in, the EEZ in the Bering Sea, the ability of licensees to continue to fish at previous levels was a compensable property right.
The regs are quite complex -- see pages 4-6 of the slip opinion for the court's summary of the regulatory-speak requirements and limitations -- and dictate the type and amount of fish which may be caught, and the type of vessel that may be employed in the catch. The Magnusun-Stevens Act reflects Congress' intent to not confer any kind of right, title, or interest in these fishing licenses, and are, apparently, completely revocable.
The plaintiffs here were building a replacement vessel ("America's Finest") and intended to transfer an already-held license from an existing vessel to the new one. So far, so good. But then the shipbuilder informed the plaintiffs that foreign steel was used in the construction of the replacement vessel. Oooh. Turns out there's a "built in the USA" requirement, and "America's Finest" wasn't exactly America's finest, if you get our drift. Meaning that the new boat couldn't be used in the EEZ and the license could not transfer.
That wasn't the end of the story. The shipbuilder "lobbied Congress for a waiver to the 'built in the United States' requirement for America’s Finest, J.A. 83 ¶ 44, and Congress subsequently passed the Frank LoBiondo Coast Guard Authorization Act of 2018, Pub. L. No. 115-282, 132 Stat. 4192 (Coast Guard Act)." And guess what? Congress granted a waiver "so that America's Finest could harvest and process fish in the Management Area." Slip op. at 7.
But the waiver came with a catch (ha ha). The Act limited the amount of a certain type of fish that the vessels, including America's Finest, could harvest. These for some unexplained reason are known as "sideboards." Next stop, the Court of Federal Claims, where the complaint alleged "that the Coast Guard Act’s sideboards amounted to an unlawful, uncompensated taking that (1) deprived FFI of the full scope of its rights under its endorsements, licenses, and permits; and (2) devalued its vessels." Slip op. at 8. Case dismissed for failure to state a claim.
The Federal Circuit affirmed the dismissal - no property interest, no taking:
Our precedent establishes that fishing permits and licenses issued pursuant to the Magnuson–Stevens Act are revocable privileges, rather than compensable property interests, see Conti, 291 F.3d at 1341–42, and there is no inherent, cognizable property interest in the use of vessels for fishing within the EEZ[.]
Slip op. at 9.
The court rejected the plaintiffs' efforts to distinguish the cases holding that these type of licenses are not property. The plaintiffs argued that Congress amended the Magnuson-Stevens Act after these decisions, and thereby imbued the licenses with the hallmarks of property, arguing they became transferable, exclusive, and irrevocable. Slip op. at 11. Nope, the court held, these things are as they were before: "non-compensable, revocable privileges." Id.
We could go on, but we won't, because the balance of the opinion lays out all the reasons the court concluded that the language of the statute defeated any claim that these licenses were intended to be some kind of vested right:
Here, the Coast Guard and the Fisheries Service issued and approved fishing endorsements, LLP licenses, and A80 QS permits that allowed FFI’s vessels to harvest and process fish from the Management Areas. Without these government-issued privileges, FFI does not have an inherent right to use its vessels to harvest or process fish in the Management Areas, as FFI itself recognizes.
Slip op. at 17.
Contrast this result with the U.S. Supreme Court's decision in an favorite case of ours, Damon v. Territory of Hawaii, 194 U.S. 154 (1904). There, the Court (in a very Holmesian opinion by, well, Justice Holmes), held that certain offshore fishing rights (which the court noted were "somewhat different from those familiar to the common law") were vested rights which qualified as constitutional property:
The right claimed is a right within certain metes and bounds to set apart one species of fish to the owner's sole use, or, alternatively, to put a taboo on all fishing within the limits for certain months, and to receive from all fishermen one-third of the fish taken upon the fishing grounds. A right of this sort is somewhat different from those familiar to the common law, but it seems to be well known to Hawaii, and, if it is established, there is no more theoretical difficulty in regarding it as property and a vested right than there is regarding any ordinary easement or profit a prendre as such. The plaintiff's claim is not to be approached as if it were something anomalous or monstrous, difficult to conceive and more difficult to admit. Moreover, however anomalous it is, if it is sanctioned by legislation, if the statutes have erected it into a property right, property it will be, and there is nothing for the courts to do except to recognize it as a right.
Id. at 158. Unlike the Magnuson-Stevens Act, Hawaii law recognized the right to fish and control use of the offshore fishery, collect tribute, prohibit use, and exclude the unwanted. Meaning it was property.
Fisherman's Finest, Inc. v. United States, No. 21-2326 (Fed. Cir. Feb. 8, 2023)
