PUBLIC UTILITY DISTRICT NO OF CHELAN COUNTY v. HAIRSTON (2025)

ORDER ON CROSS MOTIONS TO DISMISS AND MOTION TO INTERVENE

BEFORE THE COURT is Defendants’ Motion to Dismiss (ECF No. 18), Plaintiffs’ Motion to Dismiss (ECF No. 20), and Northwest Requirements Utilities Motion to Intervene (ECF No. 16). These motions were taken under consideration without oral argument. The Court has reviewed the record and files herein, and is fully informed. For the reasons discussed below, Defendants’ Motion to Dismiss (ECF No. 18) is GRANTED, Plaintiffs’ Motion to Dismiss (ECF No. 20) is DENIED, and Northwest Requirements Utilities Motion to Intervene (ECF No. 16) is DENIED as moot.

I. BACKGROUND

This case arises from a treaty between the United States and Canada called the Columbia River Treaty (the “Treaty”). On September 16, 1964, the United States and Canada entered into a treaty concerning the cooperative development of water resources of the Columbia River Basin. ECF No. 1 at ¶ 1. As part of the Treaty, Canada agreed to construct and operate several hydroelectric water-storage dams in the upper Columbia River upstream of the Canadian border to coordinate the storage and release of downstream water. Id. These dams serve the dual purpose of controlling flooding within the Columbia River Basin and improving hydropower generating capabilities of hydroelectric dams downstream in the United States. Id. Article IV of the Treaty states:

2. For the purpose of flood control until the expiration of sixty years from the ratification date, Canada shall

(a) operate in accordance with Annex A and pursuant to flood control operating plans made thereunder

(i) 80,000 acre-feet of the Canadian storage described in Article II(2)(a),

(ii) 7,100,000 acre-feet of the Canadian storage described in Article II(2)(b),

(iii) 1,270,000 acre-feet of the Canadian storage described in Article II(2)(c),

provided that the Canadian entity may exchange flood control storage under subparagraph (ii) for flood control storage additional to that under subparagraph (I), at the location described in Article II(2)(a), if the entities agree that the exchange would provide the same effectiveness for control of floods on the Columbia River at the Dalles, Oregon;

ECF No. 1-3 at 4.

In exchange, the United States agreed to return half of the downstream power benefits (“Downstream Power Benefit”) created by the Canada dams to Canada as electricity known as the “Canadian Entitlement.” Id. at ¶ 3. The Treaty lays out how the Downstream Power Benefits are to be determined. Additionally, pursuant to Article XI of the Treaty:

1. Improvement in stream flow in one country brought about by operation of storage con-structed under the Treaty in the other country shall not be used directly or indirectly for hydroelec-tric power purposes except:

(a) in the case of use within the United States of America with the prior approval of the United States entity, and

(b) in the case of use within Canada with the prior approval of the authority in Canada having jurisdiction.

2. The approval required by this Article shall not be given except upon such conditions, con-sistent with the Treaty, as the entity or authority considers appropriate.

ECF No. 1-3 at 7-8.

The referenced United States entity (“U.S. Entity”) comprises the Administrator of the Bonneville Power Administration (“BPA”) and the Commander of the U.S. Army Corps of Engineers, Northwestern Division. ECF Nos. 1 at ¶ 6, 15 at ¶ 5.

Plaintiffs, Public Utility District No. 1 of Chelan County, Washington, Public Utility District No. 1 of Douglas County, Washington, and Public Utility District No. 2 of Grant County, Washington (collectively the “Mid-Cs”), are non-governmental public utility districts that each own and operate a hydroelectric generating facility along the middle portion of the Columbia River. Id. at ¶ 2. The Mid-Cs have been operating since before the ratification of the Treaty and are specifically mentioned in the Treaty as part of the “Base System” for Treaty operations. Id.

While federal dams along the Columbia River provide most of the Canadian Entitlement through generated electricity, the Mid-Cs provided a portion of it pursuant to the Canadian Entitlement Allocation Agreements (“CEAA”) and more recently the Canadian Entitlement Allocation Extension Agreements (“CEAEA”). ECF No. 15 at ¶ 7. These agreements required the Mid-Cs to contribute 27.5% of the hydroelectric power needed for the Canadian Entitlement which, in turn, satisfied the Treaty Article XI requirements and permitted the Mid-Cs to utilize the improved stream flow for hydroelectric purposes. Id. at ¶¶ 6,8. The more recent CEAEA expired on September 15, 2024 and no further similar agreements have been put into place. ECF No. 15 at ¶ 9. The Mid-Cs continue to utilize the Downstream Power Benefits but have ceased to contribute the 27.5% of Canadian Entitlement they were previously obligated to do in the prior agreements.

 Modernized Columbia River Treaty

The Treaty includes a provision that permits the United States or Canada to terminate the Treaty after it has been in place for sixty years “if it has delivered at least ten years written notice to the other of its intention to terminate ․” ECF No. 1-3 at 13. The sixty year date of potential termination was September 15, 2024, the same date as the expiration of the CEAEA. Neither nation provided a notice of termination in 2014, but instead, jointly pursued negotiations to modernize the Treaty. ECF No. 1 at ¶ 48. On July 11, 2024, the United States and Canada announced an Agreement in Principle (“AIP”) which laid out key elements of a modernized Columbia River Treaty. ECF No. 12 at ¶ 6. However, these elements do not have the force of law. ECF No. 12-3 at 2. While the United States and Canada continue to work toward implementing a modernized Treaty, several interim agreements have been put into place including an agreement as to the Downstream Power Benefits Canada is entitled to annually from 2024 to 2044. ECF No. 20-4 at 607. Plaintiffs themselves have not entered into any agreements regarding any obligated contributions to the Canadian Entitlement.

A. Plaintiffs’ Original and Supplemental Complaint

In their original Complaint filed June 17, 2024, Plaintiffs argued that at the time they entered into the CEAEA signed in 1997, coordinated power efforts between the US and Canada and hydroelectric dam operators in the US made the Plaintiffs contribution of 27.5% of the Canadian Entitlement reasonable. ECF No. 1 at ¶¶ 16,17. However, coordination efforts have since ceased resulting in Plaintiffs’ contribution being much greater compared to their realized benefits of the downstream improved flow. Id. at ¶ 19. As a result, when the expiration of the CEAEA was drawing near, Plaintiffs pushed BPA for guidance on what the new, if any, power arrangements would be after September 15, 2024. Id. at ¶ 11. Plaintiffs were not interested in any agreement obligating them to maintain the status quo due to the disparity in contribution from both the lack of coordinated power efforts and the looming expiration of Canada's obligation to provide pre-planned delivered flood control services pursuant to Article IV of the treaty. Id. at ¶ 9. Additionally, Plaintiffs argue that in general the Treaty's calculated Downstream Power Benefits greatly exceeded the actual Downstream Power Benefits. Id. at ¶ 14.

Eventually, Plaintiffs filed a Petition for Rulemaking (“Petition”) pursuant to the Administrative Procedure Act (“APA”), 5 U.S.C. §§ 551 et seq. on May 12, 2023 requesting the U.S. Entity either (1) find Plaintiffs would not be required to comply with any conditions for the continued use of the Downstream Power Benefits or (2) commence a rulemaking proceeding to establish regulations laying out a methodology on how to calculate Plaintiff's realized Treaty related benefits. ECF No. 1 at ¶ 20. After a year without a resolution, Plaintiffs requested a consultation with BPA that they allege they were entitled to pursuant to the CEAEA, and of which BPA allegedly ignored. Id. at ¶¶ 23,24. Instead, the parties attempted to reach an agreement on what would happen after the September 15, 2024 expiration date. Id. at ¶ 24. After four months of negotiations, BPA ceased efforts to reach an agreement and asserted the extension of the CEAEA on the current terms was the only alternative. Id.

Plaintiffs subsequently filed their original Complaint with this Court on June 17, 2024, requesting the Court declare (1) the U.S. Entity unreasonably delayed taking action on Plaintiffs’ Petition for Rulemaking under the APA and (2) that under the current Treaty, the U.S. Entity cannot impose conditions on Plaintiffs’ use of the improvement in flow brought on by the storage constructed under the Treaty for hydroelectric purposes after the September 15, 2024 expiration date. Id. at 37-45.

Following the original Complaint, the United States and Canada announced the AIP. ECF No. 12 at ¶ 6. Plaintiffs allege that not only were they not consulted during these negotiations as required under the CEAEA, but under the AIP, the calculated Canadian Entitlement will well exceed half of the actual Downstream Power Benefits produced. Id. at ¶¶ 6,7.

On September 13, 2024, Plaintiffs received a letter from the U.S. Entity clarifying that after the September 15 expiration date, Plaintiffs were not permitted to continue use of improved stream flows absent an express agreement with the BPA pursuant to Article XI of the Treaty. ECF No. 12-9. If Plaintiffs continued generating with the improved flows, the U.S. Entity expected them to comply with the same 27.5% contribution to the Canadian Entitlement or face legal consequences (the “Letter”).¹ Id. at ¶ 12. Plaintiffs refused to comply with the U.S. Entity's order and subsequently filed a Supplemental Complaint (ECF No. 12). In addition to the original two claims for relief, Plaintiffs added five additional claims: (3) the U.S. Entity does not have statutory authority to order Plaintiffs to continue contributing to the Canadian Entitlement; (4) the Letter constitutes a final agency action that is arbitrary and capricious under the APA; (5) the Letter was promulgated without complying with the APA; (6) the Letter violates Plaintiffs’ due process rights; and (7) the Letter effects a taking without just compensation. ECF No. 12.

B. Defendants’ Counterclaims

Defendants filed an answer to Plaintiffs’ Complaint and Supplemental Complaint on October 31, 2024 and asserted several counterclaims. Defendants allege that Plaintiffs are using the downstream improved flow for hydroelectric purposes without U.S. Entity approval in violation of Article XI of the Treaty. ECF No. 15 at ¶ 13. They therefore seek injunctive relief prohibiting Plaintiffs’ conduct. Id. at ¶ 14. Defendants also seek declaratory judgment pursuant to 28 U.S.C. § 2201 et seq. that Plaintiffs have acted in a manner inconsistent with the United States as reflected in the Treaty through the continued prohibited use of the improved flow without U.S. Entity approval. Id. at ¶ 15. Finally, Defendants argue Plaintiffs have been unjustly enriched at the expense of the BPA, the United States, ratepayers, and other contributors to the Canadian Entitlement that have had to make up for Plaintiffs failure to act in accordance with the United States’ rights reflected in the Treaty. Id. at ¶¶ 16,17.

II. LEGAL STANDARD

Both parties have filed motions to dismiss pursuant to Fed. R. Civ. P. 12(b)(1) and (6). ECF Nos. 18, 20.

 Fed. R. Civ. P. 12(b)(1)

Federal Rule of Civil Procedure 12(b)(1) permits a party to seek dismissal of an action for lack of subject matter jurisdiction. A defendant may challenge subject matter jurisdiction in one of two ways: through a “facial attack” or a “factual attack.” Leite v. Crane Co., 749 F.3d 1117, 1121 (9th Cir. 2014). The Court's review of a facial attack is limited to the allegations in the complaint, whereas the Court “need not presume the truthfulness of the plaintiff's allegations” in a factual attack and can consider evidence outside the complaint. Id. If the jurisdictional attack is successful, the Court must dismiss the action. Fed. R. Civ. 12(h)(3). The party invoking the Court's jurisdiction bears the burden of proving its existence. Thompson v. McCombe, 99 F.3d 352, 352 (9th Cir. 1996).

 Fed. R. Civ. P. 12(b)(6)

To avoid dismissal under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim, a plaintiff must allege “sufficient factual matter ․ to state a claim to relief that is plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). The pleading standard “does not require ‘detailed factual allegations,’ but it demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation.” Id. (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). “Naked assertion[s],” “labels and conclusions,” or “formulaic recitation[s] of the elements of a cause of action will not do.” Twombly, 550 U.S. at 555, 557. “In conducting this review, [the court] accept[s] the factual allegations of the complaint as true and construe[s] them in the light most favorable to the plaintiff.” AE ex rel. Hernandez v. County of Tulare, 666 F.3d 631, 636 (9th Cir. 2012). The court, without converting the motion into one for summary judgment, may also consider matters incorporated into the complaint by reference, items subject to judicial notice, matters of public record, orders, items appearing in the record of the case, and exhibits attached to the complaint whose authenticity is unquestioned. 5B Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 1357 (3d ed. 2011).

III. DEFENDANTS’ MOTION TO DISMISS

Defendant brings a Rule 12(b)(1) factual attack; therefore, Plaintiffs’ allegations carry no presumptive truthfulness.

Defendants raise five arguments. First they argue Plaintiffs use of the improved stream flow requires approval of the U.S. Entity pursuant to Article XI of the Treaty, and the U.S. Entity has the authority to grant conditional approval. ECF No. 18 at 11-12. Second, Defendants argue that all of Plaintiffs’ claims arising under the APA fail because the U.S Entity's actions pursuant to the Treaty are precluded from judicial review under the APA. Id. at 21. Third, Defendants argue that even if the U.S. Entity's actions pursuant to the Treaty were reviewable, the Letter it sent to Plaintiffs is not a final agency action that is reviewable under the APA. Id. at 27. Defendants next argue that Plaintiffs’ claim for a due process violation fails because they do not have a property interest in the Columbia River and the claim runs afoul of the “political question” doctrine. Id. at 30. Finally, Defendants contend Plaintiffs’ takings claim similarly fails because they have not identified a cognizable property right and any such claim is not ripe for review. Id. at 34.

A. Article XI

Defendants argue Plaintiffs are required to obtain approval before using any of the Downstream Power Benefits pursuant to Article XI of the Treaty, and the U.S Entity has legal authority to grant that approval contrary to Plaintiffs’ argument. ECF No. 18 at 12. Both parties agree that whether Article XI creates judicially enforceable requirements turns on whether it is self-executing or not. Id. at 13. Where a treaty is self-executing, it automatically has effect as domestic law. “When, in contrast, ‘[treaty] stipulations are not self-executing they can only be enforced pursuant to legislation to carry them into effect.’ ” Medellin v. Texas, 552 U.S. 491, 505 (2008) (quoting Whitney v. Robertson, 124 U.S. 190, 194 (1888)). Only when a treaty, or a provision of a treaty, is self-executing “may the judiciary enter the fray to enforce it.” Id. at 508.

Courts review a treaty's provisions de novo to determine whether they are self-executing. Sanjaa v. Sessions, 863 F.3d 1161, 1166-67 (9th Cir. 2017). “The interpretation of a treaty, like the interpretation of a statute, begins with its text.” Medellín, 552 U.S. at 50. However, courts may also look to “the negotiation and drafting history of the treaty as well as ‘the postratification understanding’ of signatory nations” as “aids to ․ interpretation.” Id. at 507. The self-executing nature of a treaty, or treaty provision, may be apparent such as calling for direct judicial enforcement. However, where self-execution is less explicit, the Ninth Circuit has identified certain considerations for evaluation including whether a treaty's provision would have immediate effect or anticipate future legislative or executive action, whether the provision provides a rule of decision for courts, and whether any evidence indicates the President's or Senate's intentions regarding self-execution. Republic of Marshall Islands v. United States, 865 F.3d 1187, 1194 (9th Cir. 2017). “To assist with this textual analysis, we may look to evidence of how the treaty's enforceability was understood both before and after ratification.” Id. at 1195.

Defendants argue the Treaty is self-executing, and in particular Article XI because the language used does not indicate a need for future action by any party to make it effective but rather is worded in such a way to take immediate effect upon ratification. Article XI states “[i]mprovement in stream flow ․ shall not be used directly or indirectly for hydroelec-tric power purposes” without prior approval of the U.S. Entity. Art. XI. Mandatory language such as “shall not” is generally necessary but not sufficient of a condition to find a provision to be self-executing. See Doe v. Holder, 763 F.3d 251, 255-56 (2d Cir. 2014). Thus, the provision's language of “shall not” is not dispositive of the issue.

On the contrary, there is evidence elsewhere in the Treaty that strongly supports an interpretation that there was a need for future action at the time of ratification. Specifically, Article XIV of the Treaty describes the arrangements for implementation of the Treaty. It states:

1. Canada and the United States of America shall each, as soon as possible after the ratification date, designate entities and when so designated the entities are empowered and charged with the duty to formulate and carry out the operating arrangements necessary to implement the Treaty. Either Canada or the United States of America may designate one or more entities. If more than one is designated the powers and duties conferred upon the entities by the Treaty shall be allocated among them in the designation.

As Defendants themselves explain, after the ratification of the Treaty, then President Johnson issued an executive order pursuant to the Treaty designating the Administrator of the Bonneville Power Administration and the Division of Engineer of the U.S. Army Corps of Engineers as the “U.S. Entity.” ECF No. 18 at 17. Defendants argue this is evidence the Treaty is self-executing because no enabling legislation passed by Congress was needed. But this is incorrect. The Ninth Circuit groups future legislative, executive, and agency action together in evaluating whether a treaty or treaty provision is self-executing. Republic of Marshall Islands, 865 F.3d at 1195 n.4 (“Although courts often frame this analysis as concerning future legislative steps by Congress, this approach is equally applicable to impending executive action by the President or the agencies charged with fulfilling a treaty's objectives.”) (emphasis in original).

Here, Article XIV anticipated both future executive action, appointment of the U.S. Entity, and future action by the appointed U.S. Entity to “formulate and carry out the operating arrangements necessary to implement the Treaty.” Art. XIV (emphasis added). This language of the post-ratification order weigh in favor of finding at least a portion of the Treaty as non-self-executing. However, “it is far from uncommon for a treaty to contain both self-executing and non-self-executing provisions.” Lidas, Inc. v. United States, 238 F.3d 1076, 1080 (9th Cir. 2001). A review of Article XI reveals both self-executing and non-self-executing characteristics. First, it is reasonable that the language of Section 1 prohibiting use of improved stream flow for hydroelectric purposes without prior approval is self-executing. The language is explicit and does not anticipate future aid in implementation through legislative, executive, or agency action. Additionally, while the text does not specifically provide for direct judicial enforcement, it “create[s] a rule of decision (meaning a rule capable of resolving disputes) for U.S. Courts.” See Republic of Marshall Islands, 865 F.3d at 1193 (citation omitted). Conversely, Section 2 of Article XI states, “The approval required by this Article shall not be given except upon such conditions, consistent with the Treaty, as the entity or authority considers appropriate.” Art. XI, Section 2. Thus, the second provision of Article XI anticipates future agency action in determining conditions of approval.

With these differences in mind, the Court concludes Article XI, Section 1 is a self-executing provision while Section 2 is not.

B. Discretionary Agency Action

Defendants next challenge Plaintiffs’ claims under the APA. Specifically, that any decisions made by the U.S. Entity pursuant to the Treaty are within its sole discretion and not reviewable under the APA. ECF No. 18 at 21.

The APA permits judicial review of agency actions under 5 U.S.C. §§ 701-706. “Agency action made reviewable by statute and final agency action for which there is no other adequate remedy in a court are subject to judicial review.” Id. at § 704. However, final agency actions are not reviewable where “agency action is committed to agency discretion by law.” Id. at § 701(a)(2). In other words, “review is not to be had if the statute is drawn so that a court would have no meaningful standard against which to judge the agency's exercise of discretion. In such a case, the statute (‘law’) can be taken to have ‘committed’ the decisionmaking to the agency's judgment absolutely.” Heckler v. Chaney, 470 U.S. 821, 830 (1985).

Plaintiff argues Article XI creates two meaningful standards against which the Court could review the U.S. Entity's actions. First, Plaintiffs assert that Article XI requires that use of the improved stream flow be present in the first place, and the U.S. Entity failed to demonstrate any such use by the Plaintiffs. ECF No. 24 at 26. Plaintiffs reason that Treaty Article III obligates the U.S. Entity to ensure coordination, but failure to do so has prevented Plaintiffs from realizing improved stream flow. Id. Therefore, the U.S. Entity's demand that Plaintiffs continue to contribute a certain quantity of the Canadian Entitlement pursuant to Article XI without calculating improved stream flow under the changed circumstances is arbitrary and capricious. Id.

Second, Plaintiffs argue that the text of Article XI creates a measurable standard by requiring that the set conditions for use of the improved stream flow be consistent with the Treaty. Id. at 27. Thus, the U.S. Entity could abuse its discretion by not setting conditions of approval consistent with the Treaty. Id. at 27-28.

Plaintiffs’ arguments that the Court has authority to review the U.S. Entity's actions in light of the Treaty's other provisions necessarily requires the Court to conclude those provisions are self-executing. “Courts are empowered to give direct legal effect to treaties only insofar as they are self-executing and therefore operates as the law of the land.” Hopson v. Kreps, 622 F.2d 1375, 1380 (9th Cir. 1980). Non-self-executing Treaty provisions do not supply a judicially reviewable standard for APA purposes. See Gutrejman v. United States, 596 F. Supp. 3d 1, 12 (D.D.C. 2022) (“The Court cannot agree with the premise that the presumption of judicial review applies whenever a plaintiff files an APA claim to enforce an international agreement. If an agreement is not judicially enforceable ․ then the Court lacks the power to hear claims arising out of the agreement, irrespective of the statutory vehicle that a plaintiff relies upon to bring a cause of action.”).

The only portion of Article XI the Court finds to be self-executing is Section 1 prohibiting the use of improved stream flow without prior approval of the U.S. Entity. Therefore, the only judicially reviewable standard available to the Court is a narrow one—whether Plaintiffs are actually using the improved stream flow for hydroelectric purposes without prior approval of the U.S. Entity.

Here, while Plaintiffs’ APA claims encompass the argument the U.S. Entity has failed to show Plaintiffs meet the prerequisite of Article XI Section 1, they all necessarily rest on non-self-executing provisions, specifically Article XI, Section 1 and Article III. ECF No. 12. Section 2 of Article XI is non-self-executing as it requires the U.S. Entity to set conditions consistent with the Treaty as it considers appropriate. And Article III states,

1. The United States of America shall maintain and operate the hydro electric facilities included in the base system and any additional hydroelectric facilities constructed on the main stem of the Columbia River in the United States of America in a manner that makes the most effective use of the improvement in stream flow resulting from operation of the Canadian storage for hydro-electric power generation in the United States of America power system.

2. The obligation in paragraph (1) is discharged by reflecting in the determination of down-stream power benefits to which Canada is entitled the assumption that the facilities referred to in paragraph (1) were maintained and operated in accordance therewith.

Art. III.

Plaintiffs do not make any argument that Article III is self-executing, but in fact expend quite a few pages in their briefings arguing the Treaty is altogether not self-executing. See ECF Nos. 20, 24, 27. Yet even if they had, the Court cannot conclude it is self-executing. Section 2 of Article III creates an assumption the United States maintains and operates the hydroelectric facilities in a manner that makes the most effective use of the improvement in stream flow when it determines the down-stream power benefits Canada is entitled. The provision does not contain any self-executing qualities such as an implied directive to courts for judicial enforcement or a rule of decision. Therefore, the Court concludes Article III is not self-executing.

For these reasons, the Court is without authority to hear Plaintiffs’ claims arising under the APA, and they must be dismissed for lack of subject matter jurisdiction.

Plaintiffs’ Petition for Rulemaking

Plaintiffs argue that even if the U.S. Entity's actions are not judicially reviewable, the Court should still require it to conduct a rulemaking because it is a distinct issue. ECF No. 24 at 30.

Plaintiffs’ argument relates to their first claim that the U.S Entity unreasonably delayed in responding to Plaintiffs’ Petition to either (1) make a finding that the U.S. Entity will not impose on Plaintiffs conditions of use of the improved stream flow for hydroelectric purposes after the September 15, 2024 expiration of the CEAEA, or (2) initiate rulemaking to determine the methodology the U.S. Entity would use to calculate the Plaintiffs’ realized improved stream flow as a basis for setting conditions of Plaintiffs’ approval under Article XI. ECF No. 1 at 37-39. In Plaintiffs’ original Complaint, they asserted that because the U.S. Entity had unreasonably delayed, Option 2 was no longer available and the Court should compel the U.S. Entity to respond to the Petition by proceeding with Option 1 until it established a basis to equitably allocate Plaintiffs’ shares of the Canadian Entitlement. ECF No. 1 at 41. However, in Plaintiffs’ Response to Defendants’ Motion to Dismiss, they request that if Defendants’ actions are not subject to judicial review, the Court should still compel the U.S. Entity to initiate rulemaking as contemplated by Option 2 of the Petition. ECF No. 24 at 21.

Under 5 U.S.C. § 706(1), a reviewing court may “compel agency action unlawfully withheld or unreasonably delayed.” 5 U.S.C. § 706(1). “A claim under § 706(1) can proceed only where a plaintiff asserts that an agency failed to take a discrete agency action that it is required to take.” Norton v. Southern Utah Wilderness Alliance, 542 U.S. 55, 64 (2001) (emphasis in original). “Thus, a court may compel agency action under the APA when the agency (1) has ‘a clear, certain, and mandatory duty,’ and (2) has unreasonably delayed in performing such duty.” Vaz v. Neal, 33 F.4th 1131, 1136 (9th Cir. 2022) (quoting Plaskett v. Wormuth, 18 F.4th 1072, 1082 (9th Cir. 2021)) (internal citations omitted).

The Court finds the U.S. Entity had no such mandatory duty. Article XI explicitly empowers the U.S. Entity with authority to grant use of improved stream flow “upon such conditions, consistent with the Treaty, as the entity ․ considers appropriate.” Art. XI, Section 2. Plaintiffs cite to no language in the Treaty requiring mandatory action by the U.S. Entity with regard to Plaintiffs’ Petition in general or their request for rulemaking.

Plaintiffs’ cited D.C. Circuit cases of examples where agency failure to conduct rulemaking were violations of the APA are distinguishable. Those cases addressed either an agency's failure to follow rulemaking procedures in adopting a rule or an agency's failure to adequately provide an explanation in denying a petition for rulemaking, neither of which is the case here. Am. Med. Ass'n v. Reno, 57 F.3d 1129, 1130 (D.C. Cir. 1995) (“We hold that the rulemaking was inadequate and that the rule must be remanded ․”); Am. Horse Prot. Ass'n, Inc. v. Lyng, 812 F.2d 1, 7 (D.C. Cir. 1987) (remanding where reasonable explanation was not given in denying a petition for rulemaking); Pickus v. U.S. Bd. of Parole, 507 F.2d 1107 (D.C. Cir. 1974) (holding rules adopted without conforming to rule-making procedures mandated by APA were invalid).

Therefore, the Court concludes Plaintiffs’ first claim must also be dismissed for lack of subject matter jurisdiction.

C. Due Process and Takings Claims

Plaintiffs put forth two arguments for their due process claim. First that Plaintiffs have a property interest in the electricity generated by the Columbia River that is subject to due process. ECF No. 12 at 34 Plaintiffs also allege they have a right to an impartial decisionmaker, and the U.S. Entity, specifically the BPA, has an interest in making Plaintiffs supply more electricity than their fair share. ECF No. 12 at 35-36. Defendants challenge both in their motion for dismissal.

 Cognizable Property Interest

Defendants first argue Plaintiffs’ due process claim must be dismissed because they do not have a property interest in the Columbia River. ECF No. 18 at 30. Plaintiffs claim that by the U.S. Entity demanding the same contribution despite Plaintiffs receiving a reduced improved stream flow, their property is being taken in violation of the Fifth Amendment Due Process clause. ECF No. 12 at 34-37.

The Due Process Clause of the Fifth Amendment provides that no one shall “be deprived of life, liberty, or property without due process of law.” Thus, the Fifth Amendment protects a recognized property interest. Absent such an interest, the claim fails. Peterson v. United States Dept. of Interior, 899 F.2d 799, 807 (9th Cir.) cert. denied, 498 U.S. 1003 (1990). Acquiring a property interest requires more than a unilateral expectation of it, instead, there must be “a legitimate claim of entitlement to it.” The Bd. of Regents of State Colleges v. Roth, 408 U.S. 564, 577 (1972). Entitlements must arise from an independent source other than the constitution such as from state law, “statutes, ordinances, regulations or express or implied contracts ․” Lucero v. Hart, 915 F.2d 1367, 1370.

Plaintiffs’ argument is that the contribution amount the U.S. Entity is demanding from them as part of the Canadian Entitlement exceeds the amount of electricity Plaintiffs’ dams are actually generating as a result of the improved stream flow. ECF No. 24 at 38-39. As a result, to meet the demanded amount, Plaintiffs argue they will have to contribute hydropower that was generated pursuant to their Federal Energy Regulatory Commission (“FERC”) license. Id. at 38. Their claim is that such generated electricity is a property right subject to due process because the FERC license entitles them to that generation. Id.

As Defendants argue, and Plaintiffs admit, the U.S. Entity has authority to regulate the generation associated with the improved streamflow. ECF Nos. 24 at 38, 26 at 13. However, Plaintiffs appear to contend in a footnote they plainly have a property interest in the electricity they generate from the improved stream flow that may be subject to the Takings Clause. ECF No. 24 at 38. This contention completely conflicts with Article XI expressly forbidding use of the waters “directly or indirectly for hydroelectric power purposes” without prior approval. Art. XI (emphasis added). Plaintiffs no longer have prior approval, thus, the generating of electricity using the improved stream flow is exactly what the Treaty prohibits. Plaintiffs have no cognizable property interest in the electricity generated from the improved streamflow.

Defendants also argue that Plaintiffs have no property interest in any of the Columbia River stream flow or electricity generated from it. Indeed, Plaintiffs’ do not sufficiently plead any cognizable property interest in electricity they generate from the Columbia River. In their Supplemental Complaint, they state, “By seeking 15 – 20 fold more energy than the U.S. Entity can plausibly demand from the Mid-Cs, it is taking property from the Mid-Cs.” ECF No. 12 at 35. But Plaintiffs do not allege any factual basis for this property interest other than they operate under a FERC license. Even then, they do not describe how the FERC license grants them a cognizable property interest in the electricity they produce from the Columbia River. They simply claim it is their property because the license entitles them to it. ECF No. 24 at 38-39. However, a license does not inherently create a property interest subject to due process, see Thornton v. City of St. Helens, 425 F.3d 1158, 1164 (9th Cir. 2005), and Plaintiffs do not make any argument on how it does here. Plaintiffs’ provided citations in support are unpersuasive. Therefore, Plaintiffs’ claim of a property interest is wholly conclusory and insufficiently pled. See Iqbal, 556 U.S. 662, 678 (2009) (explaining that the court need not “accept as true a legal conclusion couched as a factual allegation.”)

 Unbiased Decisionmaker

Plaintiffs’ second argument supporting their due process claim is that the U.S. Entity is biased decisionmaker because it has a financial interest in Plaintiffs’ required contribution. ECF No. 12 at 35. More specifically, the U.S. Entity has an interest in ordering Plaintiffs to provide as much of the Canadian Entitlement as possible because the BPA is a competitor to Plaintiffs in the wholesale energy markets. Id. at 35-36. Defendants argue Plaintiffs’ due process claim fails because the U.S. Entity is not a market competitor, it requires the Court to run afoul of the political question doctrine, and it is a constitutional claim untethered to a statute. ECF No. 18 at 30-34.

The Court finds Plaintiffs have failed to state a claim upon which relief may be granted. Plaintiffs appear to argue that the Letter violates their due process right because the BPA is impartial and cannot act as a decisionmaker. However, the case Plaintiffs cite to, Ass'n of Am. Railroads v. U.S. Dep't of Transp., 821 F.3d 19 (D.C. Cir. 2016), supports a different argument. In that case, the Association of American Railroads challenged the constitutionality of the Passenger Rail Investment and Improvement Act of 2008 (“PRIIA”) which delegated authority to an economically self-interested governmental entity to regulate its competitors. Ass'n of Am. Railroads, 821 F.3d at 23. The D.C. Circuit held that such delegation violated the Fifth Amendment Due Process Clause. Id. Here, Plaintiffs analogize the Letter to a statute but it is not, nor did it provide for any sort of delegation of authority. In arguing the BPA “cannot legally act as the decision maker at all,” it seems Plaintiffs are challenging the delegation of the BPA as part of the U.S. Entity in the first place. However, Plaintiffs do not explain this directly in their complaint or briefings, or ask for any related relief. As such, the Court finds Plaintiffs have not properly stated a claim. Simply arguing the Letter itself is unconstitutional.

Plaintiff's due process claim fails. As such, their takings claim must also fail because Plaintiffs have failed to establish a cognizable property interest they were deprived of.

Therefore, both Plaintiff's due process and takings claims are dismissed without prejudice.

IV. PLAINTIFFS’ MOTION TO DISMISS

Plaintiffs move to dismiss the U.S. Entity's counterclaims under both Fed. R. Civ. P. Rule 12(b)(1) and 12(b)(6). Plaintiffs sole argument for dismissal is that Article XI of the Treaty is not self-executing and therefore not legally enforceable by the U.S. Entity. For the reasons already stated, the Court concludes Article XI Section 1 is self-executing and provides the Court subject matter jurisdiction to give it legal effect.

The U.S. Entity is the United States designated authority to implement the Treaty provisions. 29 FR 13097. Per Article XI Section 1, “Improvement in stream flow in one country brought about by operation of storage constructed under the Treaty in the other country shall not be used directly or indirectly for hydroelectric power purposes except ․ with prior approval of the United States Entity.” Art. XI, Section 1.

The U.S. Entity's claims of request of injunctive relief, declaratory relief, and unjust enrichment strictly arise out of Article XI, Section 1. Therefore, the Court finds it has authority to hear the U.S. Entity's claims. Plaintiffs’ Motion to Dismiss (ECF No. 20) is DENIED.

V. NORTHWEST REQUIREMENTS UTILITIES MOTION TO INTERVENE

Northwest Requirements Utilities (“NRU”) is a non-profit organization seeking to intervene pursuant to Fed. R. of Civ. Proc. 24(a)(2) in this case on behalf of its members who purchase power supplies from the BPA on a preferential basis pursuant to section 5(b) of the Pacific Northwest Electric Power Planning and Conservation Act (16 U.S.C. § 839c(b)). ECF No. 16 at 5. NRU claims it has the right to intervene because it has a protectable interest that may be impaired if Plaintiffs prevail on their claims. Id. at 15. However, as the Court has dismissed Plaintiffs’ claims, NRU's motion is DENIED as moot.

ACCORDINGLY, IT IS HEREBY ORDERED:

1. Defendants’ Motion to Dismiss (ECF No. 18) is GRANTED.

2. Plaintiffs’ First, Second, Third, Fourth, and Fifth Claims are DISMISSED WITH PREJUDICE.

3. Plaintiffs’ Sixth and Seventh Claims are DISMISSED WITHOUT PREJUDICE.

4. Plaintiffs’ Motion to Dismiss (ECF No. 20) is DENIED.

5. Northwest Requirements Utilities Motion to Intervene (ECF No. 16) is DENIED as moot.

The District Court Executive is directed to enter this Order and furnish copies to counsel.

FOOTNOTES

1.   Plaintiffs refer to the Letter as U.S. Entity Order in the pleadings.

THOMAS O. RICE, United States District Judge