author: DAVID S. NELSON, District Judge.

text:
    UNITED STATES of America v. Alfred ZEHE.
    Cr. No. 83-296-N.
    United States District Court, D. Massachusetts.
    Jan. 29, 1985.

      Nancy Gertner, Harvey Silverglate, Jeanne Baker, Silverglate, Gertner, Baker & Fine, Boston, Mass., for Alfred Zehe.
   MEMORANDUM OPINION

DAVID S. NELSON, District Judge.

The United States government brings this criminal prosecution under the Espionage Act (the Act), 18 U.S.C. §§ 792-99, against Alfred Zehe, an East German citizen, for alleged acts of espionage against the United States committed in Mexico and the German Democratic Republic. Zehe moves for dismissal of the indictment, contending that the Act fails to confer jurisdiction over acts of espionage committed outside of this country’s territorial boundaries by persons who are not citizens of the United States. This Court on January 2, 1985 denied the defendant’s motion and now offers this Memorandum Opinion in support of that ruling.

The Espionage Act proscribes various acts of collecting and disclosing national defense information to a foreign nation. The defendant is charged under §§ 793(b), 794(a) and 794(c) of the Act in eight counts alleging that he (1) unlawfully sought and obtained information regarding this country’s national defense, (2) delivered that information to the German Democratic Republic, and (3) conspired to deliver such information, all with the intent that the information be used to the injury of the United States or to the advantage of the German Democratic Republic. These sections provide, in pertinent part, that “[wjhoever ... copies, takes, makes or obtains ... any sketch, photograph, ... document, writing, or note of anything connected with the national defense,” id. § 793(b) or “[wjhoever ... communicates, delivers, or transmits ... any document, writing, ... or information relating to the national defense,” id. § 794(a) or conspires to so communicate, id. § 794(c), all with the requisite intent, shall be punished. These sections do not, nor does the Act elsewhere, define the territorial scope of the Act.

There is no question, nor does Zehe contest, that the Act applies to extraterritorial acts of espionage committed by citizens. Although no provision of the Act explicitly so states, the courts have consistently inferred such extraterritorial application to citizens when the proscribed offense tended to impair important governmental functions and when the United States government was vulnerable to the offense regardless of where it was committed. See United States v. Bowman, 260 U.S. 94, 98, 43 S.Ct. 39, 41, 67 L.Ed. 149 (1922) (fraud against a government corporation); United States v. Cotten, 471 F.2d 744, 749-51 (9th Cir.1973) (theft of government property); United States v. Birch, 470 F.2d 808, 811—12 (4th Cir.1972) (forgery or false use of government documents). In these three cases, the courts expressly relied upon the nature of the offenses, and not just upon the citizenship of the defendants, in order to apply other criminal statutes extraterritorially to citizens. Because espionage is an offense threatening the national security of the United States, regardless of where it occurs, the Court readily concludes that the Espionage Act was meant to apply extraterritorially to citizens.

Furthermore, the legislative history of the Act unequivocally supports the application of the Act to citizens who commit acts of espionage against the United States while abroad. Until 1961, the Act by its express terms applied only “within the admiralty and maritime jurisdiction of the United States and on the high seas, as well as within the United States.” 18 U.S.C. § 791 (repealed 1961). Congress’ repeal of this territorial limitation in 1961, P.L. 87-369, 75 Stat. 795, was prompted primarily by a highly publicized case of a citizen who had delivered secret information to foreign countries. See, e.g., 107 Cong.Rec. 10,668 (1961) (statement of Rep. Poff). Thus, congressional intent to apply the Act extraterritorially to citizens could not be clearer.

Nor is there any dispute that Congress has the power to prosecute both citizens and noncitizens for espionage committed outside of this country’s territorial limits. The defendant concedes that under principles of international law recognized by United States courts, Congress is competent to punish criminal acts, wherever and by whomever committed, that threaten national security or directly obstruct governmental functions. See, e.g., United States v. Bowman, 260 U.S. at 98, 43 S.Ct. at 41; United States v. Columba-Colella, 604 F.2d 356, 358 (5th Cir.1979); United States v. Pizzarusso, 388 F.2d 8, 9-10 (2d Cir.1968); Restatement (Second) of Foreign Relations §' 33 (1965); Harvard Research in International Law, Jurisdiction with Respect to Crime, 29 Am.J.Int’l L. 435, 543 (Supp.1935). Espionage against the United States, because it is a crime that by definition threatens this country’s security, can therefore be punished by Congress even if committed by a noncitizen outside the United States. See Restatement (Second) of Foreign Relations Law § 402(3) comment d, at 99 (Tent. Draft No. 2 1981) (citing espionage as an example of an offense that a state can punish even if committed outside its territory by persons who are not its citizens).

The defendant, while agreeing that the Espionage Act has extraterritorial application to citizens and that Congress is empowered to assert extraterritorial jurisdiction over noncitizens as well as citizens, nonetheless contends that the Act was not meant to apply to noncitizens acting entirely outside of the United States. Zehe asserts that in order to apply a criminal statute to acts committed by noncitizens beyond this country’s territorial boundaries, there must be a strong and clear showing of congressional intent. In the case of the Espionage Act, the defendant maintains that the legislative history behind the repeal of § 791’s territorial language unmistakably supports the conclusion that Congress intended to reach only the extraterritorial actions of citizens. The Court believes, however, that the intent of the repeal was simply to remove the territorial restrictions on an Act that had always applied to both citizens and noncitizens.

The defendant relies on various references in the legislative record to argue that Congress did not intend to assert jurisdiction over actions of noncitizens while abroad. In particular, he points to three series of statements: first, to the language in the House Report accompanying the bill that repealed § 791 that refers to United States v. Bowman, 260 U.S. 94, 43 S.Ct. 39, 67 L.Ed. 149 (1922), as the authority for asserting extraterritorial jurisdiction over citizens, H.R.Rep. No. 452, 87th Cong., 1st Sess. 1-3 (1961); second, to the statement by Deputy Attorney General Lawrence Walsh that, in his opinion, the Act could not constitutionally be applied to noncitizens acting outside of the United States, Hearings, Senate Comm, on the Judiciary, 86th Gong., 1st Sess., Pt. 1 at 396-98 (1959); and third, to various testimony in the Senate hearings suggesting that it would be preferable to add language limiting the Act to “residents and citizens of the United States throughout the world,” id. at 253.

The Court does not find the defendant’s legislative evidence persuasive. References in the House Report to the rule of Bowman, a case that extended extraterritorial jurisdiction over citizens, do not mean that Congress intended to preclude the assertion of extraterritorial jurisdiction over noncitizens. The House committee cited Bowman to indicate that Congress had the power to give criminal laws extraterritorial effect, not to limit the repeal of the territorial limitation to only citizens. H.R.Rep. No. 452, supra, at 1. Furthermore, Bowman contains a general exposition of how congressional intent to apply a statute ex-traterritorially can be inferred and does not limit its reasoning to citizens. 260 U.S. at 98, 43 S.Ct. at 41. As for Mr. Walsh’s opinion as to the constitutionality of Congress reaching out to acts of noncitizens outside the United States, he is simply incorrect and the defendant has not argued otherwise. See Rocha v. United States, 288 F.2d 545, 549 (9th Cir.1961).

Finally, the defendant’s reliance on testimony suggesting that Congress should have limited the extraterritorial effect of the Act to “residents and citizens” undercuts the defendant’s own conclusions. Although it was suggested that extraterritorial jurisdiction over noncitizens could easily be avoided by explicitly restricting the Act’s application to “residents and citizens of the United States throughout the world,” no such language was adopted. Congress ignored an explicit warning that the Act would, after the repeal of § 791, apply to noncitizens committing espionage outside the United States.

The failure of Congress to respond to this warning belies another principal argument advanced by defendant — that the legislative history’s repeated references to citizens and its alleged silence as to noncitizens manifest an intention to address only acts of espionage committed by the former. To the contrary, direct testimony warning Congress that the repeal of § 791 would extend the scope of the Act to extraterritorial acts of noncitizens was explicitly proffered, thus indicating that Congress contemplated the effect of the repeal on non-citizens. Although Congress’ primary objective in the repeal may have been to assert extraterritorial jurisdiction over citizens in the wake of a highly publicized case of a citizen who passed secret information to another country, this motivation does not preclude Congress from also intending to reach out to noncitizens. Congress’ desire to extend jurisdiction of the Act to citizens abroad may have been just one aspect of a more general concern that limiting the scope of the espionage laws was hampering the effective prosecution of espionage crimes.

Indeed, the Act had never in the past distinguished between citizens and noncitizens. Before the repeal of § 791’s territorial limitation on the Act’s jurisdiction, the Act proscribed acts of espionage within United States territorial limits and the high seas without regard to the nationality of the offender. See, e.g., Gorin v. United States, 312 U.S. 19, 22, 61 S.Ct. 429, 431, 85 L.Ed. 488 (1941) (involving prosecution under §§ 1 and 2 of the Espionage Act of 1917, 50 U.S.C. §§ 31, 36, recodified without material change at 18 U.S.C. §§ 793, 794); United States v. Abel, 258 F.2d 485, 487-88 (2d Cir.1958), aff'd on other grounds, 362 U.S. 217, 80 S.Ct. 683, 4 L.Ed.2d 668 (1960). Given Congress’ failure to distinguish between citizens and noncitizens when repealing the territorial restriction, the Court sees no reason to infer that the Act does not continue to apply to both citizens and noncitizens. Therefore, the Court finds that the legislative record, although sparse and at times ambiguous, does indicate that Congress meant the Act to apply extraterritorially to noncitizens as well as citizens.

In any event, although the Court agrees that there must be strong and clear evidence of congressional intent to apply a criminal law beyond this country’s territorial boundaries to noncitizens, legislative history is not the sole or primary means of determining congressional intent. Courts have often inferred congressional intent to apply penal statutes to offenses committed abroad from the nature of the proscribed act, with only marginal reliance on, or even no reference at all to, the legislative history. In particular, as discussed previously, in cases involving citizens, courts have found congressional intent to give a statute extraterritorial effect when the offense interferes with governmental operations and can be committed as easily outside as inside the United States. Although these cases may have depended in part on the fact that the defendants were citizens, courts in the case of noncitizens have similarly looked to the essence of the act Congress sought to punish in order to discern congressional intent to apply a criminal statute extraterritorially. In United States v. Pizzarusso, 388 F.2d at 9, the court reasoned that intent could be inferred from a logical reading of a statute punishing false statements on visa applications. The court concluded that, because such false statements would ordinarily occur outside of the United States, Congress intended to apply the statute extraterritorially to noncitizens. See also United States v. Rodriguez, 182 F.Supp. 479, 484-86 (S.D. Cal.1960), aff'd in part and rev’d on other grounds sub nom. Rocha v. United States, 288 F.2d 545, 549 (9th Cir.1961) (same). In neither case did the court even mention the legislative history of the statute at issue.

Following this analysis, the Court finds strong congressional intent to apply the Espionage Act to the extraterritorial acts of noncitizens both from the face of the statute and from the nature of the crime of espionage. First, as noted previously, the Act makes no distinction between citizens and noncitizens. Second, espionage is an offense that is as likely to occur within foreign countries as within this country because of the large number of United States defense installations and military personnel located abroad. Furthermore, the essence of an espionage crime is that it is directed against the national security of a country and so does not logically depend on locality. The Court hence finds it reasonable to infer that Congress intended to assert jurisdiction up to the limits of international law and prosecute noncitizens for espionage against the United States regardless of where the act of obtaining or disclosing defense information in fact occurred.

Finally, the defendant questions the policy implications of applying the Act to non-citizens who might merely have reviewed defense documents supplied to them by their respective governments. The Court does not find the defendant’s scenario likely. Under the statutorily defined crimes of espionage in §§ 793 and 794, noncitizens would be subject to prosecution only if they actively sought out and obtained or delivered defense information to a foreign government or conspired to do so.

The defendant in his arguments has relied solely on legislative history to discern congressional intent, and in so doing has misapprehended the broad intent behind the repeal of the territorial limitation — to allow full enforcement of the espionage laws wherever the offense may be committed. The defendant has failed to give serious credence to expansive jurisdictional statements explaining that the purpose of the proposed repeal “is to extend the application of [the act] ... to acts committed anywhere in the world,” H.R.Rep. No. 452, supra, at 1, because “it is imperative that the laws of this Nation protect it from acts of espionage committed abroad as well as at home.” Id. The Court finds that the Act may be applied extraterritorially to both citizens and noncitizens because of the threat to national security that espionage poses. It is for the foregoing reasons that this Court denied the defendant’s motion to dismiss for lack of subject matter jurisdiction.

      . This jurisdictional inquiry arguably is only pertinent to the Court’s consideration of Counts Two through Eight of the indictment because these counts allege substantive offenses occurring wholly outside of United States territory. Count One, by contrast, alleges an ongoing conspiracy with overt acts, some of which the government now claims occurred within the United States, on the premises of the East German embassy in Washington, D.C. and elsewhere. The defendant argues that any alleged acts, even if proved, could not serve as a basis of jurisdiction if committed by East German diplomats on embassy premises. The government counters that regardless of the significance of acts committed on the embassy premises, other overt acts — particularly the' mailing of postcards — in furtherance of the conspiracy were committed outside of those premises and within the United States. The Court finds it unnecessary to resolve this dispute since jurisdiction is independently appropriate over Count One under the analysis set forth below.

      . One court has already applied the Act to a citizen who allegedly committed acts of espionage while abroad. United States v. Helmich, 521 F.Supp. 1246, 1252 (M.D.Fla.1981).

      . The defendant acknowledges in his further briefing that "the protective principle, though rarely used, had been a part of the jurisprudence of this country both before 1961 and in 1961, when Congress enacted the statutory amendment at issue here.” Under international law, the "protective principle” gives a country the "jurisdiction to prescribe a rule of law attaching legal consequences to conduct outside its territory that threatens its security as a state or the operation of its governmental functions, provided the conduct is generally recognized as a crime under the law of states that have reasonably developed legal systems.” Restatement (Second) of Foreign Relations § 33 (1965).

      . Under the defendant’s reading of the Act, courts could assert extraterritorial jurisdiction over noncitizens in just two situations: (1) in cases where a noncitizen while abroad had conspired with a citizen to collect or disseminate defense information of the United States, even if no act occurred within this country; and (2) in cases where a noncitizen while abroad had conspired with another noncitizen who committed overt acts in the United States.

      . Testimony of Professor Roger Fisher, Hearings, Senate Comm, on the Judiciary, 86th Cong., 1st Sess., Pt. 1, at 253 (1959).

      . Professor Fisher testified that "the statute [H.R. 1992 proposing the repeal of § 791] would make it a crime for a local national, acting in the interest of his own government, within his own country, to take a picture of U.S. military equipment that was there, if the purpose were to aid his own government." Id.

      . Even the defendant’s assertions implicitly concede that legislative history does not give the definitive answer in statutory construction. Zehe concedes that the Act has at least limited extraterritorial applicability to foreign nationals. See note 4 supra. However, the defendant does not depend on support in the legislative history for such an interpretation, but must rely on a fair reading of the Act. It is true that there must be a strong showing of; congressional intent to give a statute extraterritorial applicability, but it is rare that this burden can be met through a legislative record that is unequivocal. On the question of the Act’s applicability to citizens who commit acts of espionage abroad, the record is unmistakable, but every reading of congressional intent need not be so strong.


source: Caselaw Access Project

author: TAURO, District Judge.

license: Public Domain

text:
    Harvey PASTAN, as Trustee of Greenacre Trust, and Charter Development Corporation, Plaintiffs, v. CITY OF MELROSE, et al., Defendants.
    Civ. A. No. 84-1147-T.
    United States District Court, D. Massachusetts.
    Jan. 29, 1985.

      Thomas R. Murtagh, Richard D. Gass, Jeffrey S. Robbins, Mintz, Levin, Cohn, Ferris, Glovsky & Popeo, Boston, Mass., for plaintiffs.
    P. Sabin Willett, James F. McHugh, Bingham, Dana & Gould, Boston, Mass., for defendants.
   MEMORANDUM

TAURO, District Judge.

Developer Harvey Pastan and Charter Development Corporation brought this action challenging a taking of property by the city of Melrose which allegedly thwarted development of a residential condominium project. Their claim is that the defendants — the city of Melrose, the Mayor of Melrose, and the Melrose Board of Aldermen — condemned the property at the behest of a few Melrose homeowners solely for the purpose of blocking the project, in violation of the Fourteenth Amendment, 42 U.S.C. § 1983 and § 1985 (1982), Mass.Gen. Laws Ann. ch. 12, § 111 (West Supp.1984) and state common law.

I.

The facts alleged in plaintiffs’ complaint are accepted as true for the purposes of this motion to dismiss.

In early August 1983, Pastan contracted to purchase a parcel of land located predominantly in Saugus, Massachusetts on which he intended to • build a residential condominium project to be known as Sheffield Woods. A small strip of the parcel that extended into Melrose (the “Melrose strip”) was to be used as a secondary emergency access and egress route. The homeowners in the vicinity of the Melrose strip opposed the Sheffield Woods plan because they believed that the roadway would have an adverse effect on their neighborhood by hampering views and increasing traffic.

Despite the objections of the Melrose homeowners and the Mayor of Melrose, the Saugus Planning Board voted on April 3, 1984 to recommend that the Town Meeting approve Pastan’s rezoning proposal. On April 5th, the Melrose Board of Aldermen convened a public meeting and voted unanimously to take the Melrose strip for use as a public park. On April 9th, after the Mayor of Melrose approved the taking, the Saugus Town Meeting tabled Pastan’s rezoning proposal because Pastan was unable to provide a second means of emergency access and egress.

II.

This case presents the question whether a taking of property for a clearly public use, such as a park, may be attacked under the Public Use Clause of the Fifth Amendment on the ground that the motive for the taking is solely to confer a private benefit.

In Hawaii Housing Authority v. Midkiff, — U.S. -, 104 S.Ct. 2321, 81 L.Ed.2d 186 (1984), the Supreme Court reaffirmed the broad scope of the eminent domain power and a state’s authority to determine what is a public use. The Court noted that it “has made clear that it will not substitute its judgment for a legislature’s judgment as to what constitutes a public use ‘unless the use be palpably without reasonable foundation.’ ” [Citation omitted.] Id. 104 S.Ct. at 2329. The Court went on to instruct that, “where the exercise of the eminent domain power is rationally related to a conceivable public purpose, the Court has never held a compensated taking to be proscribed by the Public Use Clause.” Id. 104 S.Ct. at 2329-30.

The Court’s decision in Hawaii upheld the Hawaii Land Reform Act as a rational solution to Hawaii’s land oligopoly problem. That Act provided a mechanism for taking residential tracts belonging to large landowners and transferring their ownership to existing lessees. In upholding the validity of the realty transfers, the Court rejected the argument that, because the property in issue was conveyed to private rather than public ownership, the program ran afoul of the Public Use Clause:

The mere fact that property taken outright by eminent domain is transferred in the first instance to private beneficiaries does not condemn that taking as having only a private purpose. The Court long ago rejected any literal requirement that condemned property be put into use for the general public.

Id. 104 S.Ct. at 2331.

Hawaii, therefore, stands for the proposition that, as long as property taken by eminent domain is dedicated to a public purpose, the motives of the taking authority are irrelevant. This principle is consistent with that of the Seventh Circuit in its opinion, Green Street Ass’n. v. Daley, 373 F.2d 1 (7th Cir.), cert. denied, 387 U.S. 932, 87 S.Ct. 2054, 18 L.Ed.2d 995 (1967), which held that, “Given a public purpose or use, the motives that underlie the exercise of that power may not be questioned.” Id. at 6. See also Atlantic Coastline R. Co. v. Town of Sebring, 12 F.2d 679, 681 (5th Cir.1926) (“Where a particular taking of property for a public use has been authorized ..., a court is without jurisdiction to supervise the determination ... as to the necessity or expediency of taking the property selected, or to prevent the taking on the ground that the action ... was influenced by a purpose to benefit one or more property owners____”).

Indeed, this principle is a logical refinement of the general concept that the motivation of a legislator in voting one way or another is irrelevant to any analysis of legislative construction or validity. In another context, this court has stated:

[A]s is true in all cases of congressional action, the various legislators were motivated by a variety of factors. The debate affords us a view as to their movtives. But congressional motivation is of historical and not legal significance. Congressional motivation does not affect the legal consequences of congressional action.

Drinan v. Nixon, 364 F.Supp. 854, 865 (D.Mass.), aff'd, 502 F.2d 1158 (1st Cir. 1973).

Plaintiffs cite only one case in which the motives of a taking for a public use, such as a park, raised a constitutional issue. In that case, Progress Development Corp. v. Mitchell, 286 F.2d 222 (7th Cir.1961), village officials sought to build a public park on a piece of land that plaintiffs had announced they were going to use for the construction of integrated housing. The court ruled that plaintiffs would be entitled to relief under the civil rights laws if they could show that the sole purpose of the taking was to conspire to deny the plaintiff equal protection of the laws. See Green Street Ass’n v. Daley, 373 F.2d at 5-6 (discussing Progress holding).

In this case, plaintiffs make no claim that the defendants were motivated by racial animus, which might state a violation of the Equal Protection Clause. Nor do plaintiffs maintain that defendants were motivated by’ religious designs or a desire to punish the expression of protected speech. Cf. Epperson v. Arkansas, 393 U.S. 97, 89 S.Ct. 266, 21 L.Ed.2d 228 (1968) (anti-evolution statute struck down because of religious purpose); Mt. Healthy City Bd. of Educ. v. Doyle, 429 U.S. 274, 97 S.Ct. 568, 50 L.Ed.2d 471 (1977) (discharge of teacher in retaliation for exercise of protected speech held unconstitutional).

Plaintiffs do maintain that it is proper for this court to look behind a facially public use where, as here, there is an allegation of bad faith and arbitrary and capricious action. But that allegation asserts no more than an abuse of discretion by the defendants and does not rise to the level of a constitutional deprivation, although it may be a violation of state law. To be sure, a violation of state law that deprives an individual of a property right may violate the Due Process Clause. See, e.g., Roy v. City of Augusta, 712 F.2d 1517 (1st Cir.1983). But, a “mere bad faith refusal to follow state law in ... local administrative matters simply does not amount to a deprivation of due process where the state courts are available to correct the error.” Chiplin Enterprises v. City of Lebanon, 712 F.2d 1524, 1528 (1st Cir.1983). In this case, there is no reason to believe that that the Massachusetts courts would not consider plaintiffs’ challenge that Melrose officials abused their discretion under the Commonwealth’s eminent domain statute.

III.

Assuming, arguendo, that motive is relevant to the authorization of a facially valid taking, the court finds the alleged motives of the Melrose officials to be valid. Stopping the development of exclusive residential condominiums because the project would create additional traffic, harm the aesthetic quality of life of nearby Melrose homeowners or diminish the value of their property may be parochial, but it is perfectly consistent with a rational view of the public interest of the city of Melrose. Cf. Creative Environments, Inc. v. Estabrook, 680 F.2d 822, 832 (1st Cir.), cert. denied, 459 U.S. 989, 103 S.Ct. 345, 74 L.Ed.2d 385 (1982) (Planning board’s rejection of development plan held not to violate Due Process where “it is merely indicated that town officials are motivated by parochial views of local interests which work against plaintiffs’ plan and which may contravene state subdivision laws.”) A taking does not become “private” simply because its immediate benefits will accrue only to a small number of persons. See United States v. 416.81 Acres of Land, 514 F.2d 627, 632 (7th Cir.1975) (upholding government’s determination of public use of taking for a public park, even assuming government intended to aid a commercial seaport project). Elected town officials must have broad discretion to determine what is in the public interest. The Board of Aldermen’s view that a public park is preferable to an emergency access road and a neighboring condominium development is not so unreasonable as to violate the Public Use Clause of the Fifth Amendment.

Because plaintiffs have not been denied a federal right, their complaint fails to state a claim for relief under 42 U.S.C. § 1983. Accordingly, plaintiffs’ complaint, including the state law counts, is dismissed. See United Mine Workers v. Gibbs, 383 U.S. 715, 726, 86 S.Ct. 1130, 1139, 16 L.Ed.2d 218 (1966). An order will issue.

      . The Fifth Amendment provides, in pertinent part, that "private property [shall not] be taken for public use, without just compensation.” It is made applicable to the States through the Fourteenth Amendment.

      . The court assumes, without deciding, that plaintiffs’ contractual interest in the property in question is a property interest protected by the Fifth Amendment.

      . Plaintiffs concede that that their complaint fails to allege a class-based, invidious intent and, consequently, that their § 1985 count should be dismissed.

      . It is unclear whether this allegation simply restates the claim that the Board acted with an illicit motive, or whether it is meant to include other alleged factors such as the haste with which the Board acted, the lack of substantive debate at the Board meeting, and the fact that the taking was recorded by private citizens.

      . Similarly, allegations of fraud, bad faith or abuse in a federal taking go to the question whether the taking is authorized by Congress, not the question of public use. See United States v. Carmack, 329 U.S. 230, 243, 67 S.Ct. 252, 258, 91 L.Ed. 209 (1946). But see United States v. 416.81 Acres of Land, 514 F.2d 627, 632 (7th Cir.1975) (egregious bad faith may negate public use).

      . In Suthoff v. Yazoo County Industrial Development Corp., 637 F.2d 337 (5th Cir.), reh'g denied, 642 F.2d 822 (1981), cert. denied, 454 U.S. 1157, 102 S.Ct. 1032, 71 L.Ed.2d 316 (1982), cited by plaintiffs, the court noted that "for purposes of maintaining initial federal jurisdiction, ... allegations that an individual's property rights have been damaged, through a municipality’s arbitrary misuse of instituted but abandoned state-law expropriation proceedings [to force a landowner to sell his property to entities not entitled to take it by eminent domain], adequately state a claim of deprivation of property without due process of law in violation of the federal constitution.” Id. at 340. The court emphasized, however, that it was not necessarily holding that plaintiffs would prevail if they established the facts alleged in the complaint.

      . Plaintiffs argue that judicial review of takings by local governments should be more stringent than review of takings by state legislatures or Congress because cities are more prone to corruption by powerful private interests. The assumption that there is a greater likelihood of abuse at the local level is certainly open to challenge and debate. Even if true, however, it does not follow that less deference is owed elected town officials. The Legislature and courts of the Commonwealth are perfectly capable of policing the cities and towns, whose only powers are those delegated from the state. Cf. State v. Hutchinson, 624 P.2d 1116 (Utah 1980) (abandoning rule requiring strict construction of powers delegated to cities).


author: GENE CARTER, District Judge.

text:
    UNITED STATES of America v. George Bernard MORAN.
    Crim. No. 83-00022 B.
    United States District Court, D. Maine.
    Jan. 29, 1985.
    Richard S. Cohen, U.S. Atty., Joseph H. Groff, III, Asst. U.S. Atty., Portland, Me., for plaintiff.
    Daniel G. Lilley, Law Offices of Daniel G. Lilley, Portland, Me., for defendant.
   ORDER ON DEFENDANT’S MOTION FOR REDUCTION OF SENTENCE

GENE CARTER, District Judge.

Defendant has moved for reduction of his sentence of eight years incarceration, which was imposed by this Court on May 11, 1984. As grounds for the reduction, Defendant argues that he was sentenced under parole regulations not in effect at the time he committed the offenses and that such sentencing therefore violates the ex post facto prohibition expressed in Article I, Section 9, Clause 3 of the Constitution.

The Court declines to address the issue raised by Defendant. Sentencing in this matter was imposed under three statutes, 21 U.S.C. § 963, 21 U.S.C. § 846, and 26 U.S.C. § 7206(1). It was not imposed under parole regulations. Defendant argues that the Court relied on the alleged wrong regulations because they formed the basis for the recommendations and parole-release information contained in the presentence investigation report. The Court can say, in all candor, however, that in drug cases, the sentence imposed represents the number of years the Court, at the time of sentencing, thinks the Defendant should serve. The sentence is not, therefore, invalid because the Court, in framing it, relied on allegedly ex post facto guidelines.

The Court, of course, is aware that in most cases defendants become eligible for parole after they have served one-third of their terms. The Court is further aware that the Parole Commission has developed an administrative system with comprehensive procedures and guidelines that govern the execution of any sentence imposed by the Court. Application of the guidelines is a purely administrative matter having to do with the execution rather than the imposition or illegality of the sentence. Thompson v. United States, 536 F.2d 459, 460 (1st Cir.1976). As the sentencing court, this Court does not have jurisdiction to hear issues involving the application of the guidelines. Id. Defendant should address such questions through appropriate administrative channels.

Defendant also argues that because of application of the new guidelines he was wrongly placed in category six, and that the Court mistakenly viewed him as having a managerial role in the offense. Although it is true that the Court seriously considered the role of Defendant in determining the appropriate sentence for him, it did not rely for its evaluation on the category of severity assigned the offense in the presentence report. The Court was thoroughly familiar with the activities of the various co-conspirator's from the lengthy descriptions of the offenses provided in the presentence investigation reports. Although Defendant complains that he was mistakenly characterized as master of the boat, the Court must say that it was not that characterization, but rather the total picture of Defendant’s activities set forth in the presentence report, that formed the basis for the sentence. If Defendant thinks that his parole eligibility has been prejudiced by mischaracterization of his role in the offense, that issue, too, should be raised through the appropriate administrative channels.

The Defendant’s reliance upon United States ex rel. Foreman v. McCall, Chairman, United States Parole Commission, Civil No. 81-0553 (M.D.Pa., Sept. 14, 1984) fails to consider the procedural and jurisdictional niceties exemplified in that case. The case is to be distinguished from the present matter because it was instituted as a habeas attack upon the Parole Commission’s application of eligibility guidelines. Thus, the procedural basis of the action is in accord with the controlling law of this circuit. See, Thompson v. United States, 536 F.2d 459, 1st Cir.1976). The facts of the McCall case demonstrate the reason for the First Circuit jurisdictional rule. There the Chairman of the Parole Commission, in his official capacity, was the named party defendant. Thus, the party complained against, the Parole Commission, was afforded direct party status which would permit it the opportunity to defend its action, which was, after all, the object of the challenge there made, as it is here. The beneficial effect of such direct party status of the Commission is not available in a proceeding under Rule 35.

Since the Commission’s actions are the basis of the Defendant’s contention, the appropriate relief is to require it to redress the resulting illegality if it has in fact acted inappropriately. That may not be achieved here under Rule 35 where the Court’s only power is to reduce the sentence. Such action does not directly correct, but rather sidesteps, the act that is the source of the complaint. Because the challenge in the McCall case was raised in habeas proceedings to which the Commission was a party, the Court could, and did, remand to the Commission “to reconsider its determination and to compute the Petitioner’s appropriate release date in compliance with the guidelines in effect in 1974.” McCall, supra, Order of September 14, 1984, at H1. In a habeas proceeding, the actual wrong may be appropriately and fully addressed in an adversary procedure in which the evidence underlying the Commission’s action may be produced and evaluated, and direct and effective relief granted by the Court. There is a clear therapeutic advantage achieved by directly addressing the alleged wrongful act that cannot be achieved under Rule 35.

Finally, Defendant seeks to have his sentence reimposed under 18 U.S.C. § 4205(b)(2) in order that he might be released on parole at such time as the Commission may determine. Defendant seeks this redesignation, which might make him eligible for parole earlier than the time prescribed by the guidelines, because of the family hardship caused by his incarceration. The Court made due allowance, in originally settling upon the sentence, for the repentant attitude of the Defendant, expressed in the submissions to the Court by counsel and also documented by the Defendant’s own statements and the submissions of members of his large and supportive family. The Court took the hardship upon Defendant’s family into account in imposing its initial sentence, realizing that the post-sentence situation would presumably involve the birth of the Defendant’s fourth child. The Court fully considered when it framed the original sentence all of the circumstances now pointed to by Defendant and by his counsel as justifying a reduction of sentence.

Accordingly, it is ORDERED that Defendant’s Motion for Reduction of Sentence be, and is hereby, DENIED.

So ORDERED.

      . Defendant's argument concerning the Court’s reliance on the new, higher guidelines is at cross purposes to his expressed desire to have his sentence reduced. Assuming that the Court imposed an eight-year sentence relying, as Defendant suggests, on the expectation that a defendant would only serve forty months, presumably a higher sentence would have been imposed if the Court thought that the eight years would only result in the twenty-five months incarceration that Defendant suggests is appropriate under the superseded guidelines.


author: DEVITT, District Judge.

text:
    BOLGER PUBLICATIONS, INC., Bureau of Engraving, Inc., Daily Printing, Inc., Japs-Olson Company, Inc., The John Roberts Company, Inc., Meyer Printing Company, Viking Press, Inc., Plaintiffs, v. GRAPHIC COMMUNICATIONS INTERNATIONAL UNION LOCAL 229, AFL-CIO, CLC, a/k/a Graphic Arts International Union Local 229, AFL-CIO, CLC; Graphic Communications International Union Local 1B, AFL-CIO, CLC, a/k/a Graphic Arts International Union Local 1B, AFL-CIO, CLC; Graphic Communications International Union, AFL-CIO, CLC, a/k/a Graphic Arts International Union, AFL-CIO, CLC, Defendants.
    No. Civ. 3-83-1070.
    United States District Court, D. Minnesota, Third Division.
    Jan. 31, 1985.

      James P. Mulvahill, Michael W. Unger, and Samuel D. Heins, Minneapolis, Minn., for defendants.
    Steven C. Miller, and Charles Cox, Minneapolis, Minn., for plaintiffs.
   MEMORANDUM & ORDER

DEVITT, District Judge.

Defendants move for reconsideration of this court’s order dated December 20, 1984, to the extent it held that their appeal from a magistrate’s order was untimely. Plaintiffs oppose the motion and bring a counter motion for attorneys’ fees.

Both motions are considered on their briefs, without oral arguments.

The sole issue before the court is whether Fed.R.Civ.P. 6(e) applies to appeals brought under Fed.R.Civ.P. 72(a). For the reasons which follow, the court holds that it does not.

Defendants in this labor dispute brought a discovery motion before the United States magistrate on November 19, 1984. The magistrate ruled from the bench, denying defendants’ motion. One week later, on November 26, 1984, the magistrate entered a written order which was consistent with his oral ruling. The same day, the clerk of court mailed copies of the magistrate’s order to all parties.

On December 10, 1984, or fourteen days after entry of the magistrate’s order, defendants filed a notice of appeal pursuant to 28 U.S.C. § 636(b)(1)(A), Fed.R.Civ.P. 72(a), and Local Rule MiBXb). This court held, in its December 20, 1984, order, that defendants’ appeal was untimely. Defendants now seek reconsideration on this issue. It is undisputed that if Fed.R.Civ.P. 6(e) applies to appeals of this nature, defendants’ motion was timely.

The language of Fed.R.Civ.P. 6(e) clearly states the instances to which the rule applies. It applies “whenever a party ... is required to ... take some proceedings within a prescribed period after the service of a notice or other paper upon him and the notice ... is served upon him by mail.” Fed.R.Civ.P. 72(a) does not require a party to take any action “within a prescribed period after the service of a notice or other paper.” Rather, it requires a party to serve and file objections to a magistrate’s order “within 10 days of the entry of the order.” A similar requirement is imposed by Local Rule 14(B)(b).

Looking to the plain language of these rules, it is clear that the drafters did not intend Fed.R.Civ.P. 6(e) to apply to appeals brought under Fed.R.Civ.P. 72(a). If they had, they would have required a different procedure, as they did with appeals from magistrates’ proposed findings and recommendations. See 28 U.S.C. § 636(b)(1)(C); Fed.R.Civ.P. 72(b); Local Rule 14(C)(b).

The conclusion reached by the court today is in accord with that reached by commentators who have considered this issue. See, Fed.R.Civ.P. 72 advisory committee notes; 7 J. Moore, J. Lucas & K. Sinclair, Jr., Moore’s Federal Practice 1Í 72.03[6.-4] (2d ed. 1984); K. Sinclair, Jr., Practice Before Federal Magistrates, § 16.07, at 16-13 through 16-15 (1983).

Defendants rely on the case of Fischer v. McGowan, 585 F.Supp. 978 (D.R.I.1984) to support their argument. In Fischer, the court implied in dictum that Fed.R.Civ.P. 6(e) applied to an appeal before it which was brought under Fed.R.Civ.P. 72(a). Id. at 983 n. 10.

The facts of Fischer, however, clearly distinguish it from the case sub judice. In Fischer, a non-party was appealing from a magistrate’s order compelling him to answer deposition questions. While it is not clear from the published opinion and order, it appears that the magistrate did not rule from the bench. Instead, he filed an order which was mailed to the parties. Since the appealing party was not a party to the lawsuit, he did not receive a copy of the order or any notice of it having been filed. He appealed from the order within ten days after he learned of it, but more than ten days after its entry.

In holding that the deponent’s appeal was timely, the court noted that “no precise time is prescribed for the filing of such an appeal by a non-party,” and that “given the concatenation of extraordinary circumstances at bar, this court has little difficulty in holding that the deponent’s appeal was seasonable.” Id. at 983.

In the case at bar, the appeal is being taken by parties to the lawsuit. In fact, the appealing parties have brought similar appeals in the past and are presumably familiar with the applicable rules. The appealing parties were given an oral ruling on their motion at the time of the hearing, something not required of the magistrate. Since the magistrate’s written order was not entered until a week later, this alone had the effect of adding seven days onto the time in which defendants had to prepare their appeal. Once entered, the appealing parties received prompt notice of the magistrate’s written order. There being no “concatenation of extraordinary circumstances at bar,” defendants’ reliance on Fischer v. McGowan is misplaced.

Based on the foregoing,

IT IS ORDERED:

1. Upon reconsideration, this court’s order of December 20, 1984, is AFFIRMED;

2. Plaintiffs’ motion for attorneys’ fees is DENIED.

      . Rule 14(B)(b) of the Local Rules for the United States District Court for the District of Minnesota, dealing with non-dispositive pretrial matters, provides:
      Any party may appeal from a magistrate’s determination made under this rule within ten (10) days after issuance of the magistrate’s order, unless a different time is prescribed by the magistrate or a judge. Such party shall file with the clerk of court, and serve on all parties, a written notice of appeal which shall specifically designate the order or part thereof appealed from and the basis for objection thereto. A judge of the court shall consider the appeal and set aside any portion of the magistrate’s order found to be clearly erroneous or contrary to law. The judge may also reconsider any matter sua sponte.

      . Fed.R.Civ.P. 6(e) would add three days onto the time in which defendants had to file their appeal. This would have extended the time for appeal to Sunday, December 9, 1984, making their appeal, which was filed on Monday, December 10, 1984, timely. Fed.R.Civ.P. 6(a).


author: WEINER, District Judge.

text:
    Sabina GATTI and John Gatti v. The HANOVER INSURANCE COMPANY.
    C.A. No. 84-5833.
    United States District Court, E.D. Pennsylvania.
    Jan. 31, 1985.
    Charles J. Arena, Philadelphia, Pa., for plaintiff.
    Fred B. Buck, Philadelphia, Pa.,' for defendant.
   MEMORANDUM OPINION AND ORDER

WEINER, District Judge.

The plaintiffs, Sabina and John Gatti, brought suit in the Court of Common Pleas of Philadelphia County, to recover $42,-426.70 under the terms of an insurance policy issued to them by defendant, The Hanover Insurance Company. Defendant had the case removed to this court based on diversity of citizenship. Presently before the court are the parties’ cross-motions for summary judgment. For the reasons which follow, the plaintiffs’ motion for summary judgment is granted and the defendant’s motion is denied.

The parties have stipulated to the facts. On October 18, 1983, defendant issued its Special Businessowners Policy of Insurance to the plaintiffs as owners of the Timber Cover Apartments, an apartment complex in Northeast Philadelphia. On April 3, 1984, plaintiffs’ employees noticed a depression in the ground on the premises of the apartment complex and a wetness surrounding the area. The water meter was found to be spinning rapidly and, after further investigation, it was determined that large amounts of water were leaking into the ground from underground pipes after the water had passed through the meter. Plaintiffs filed a claim with defendant for $762.52, representing the costs incurred in repairing the pipes; $39,523.44, representing the charges made by the City of Philadelphia for the water which passed through the meter and leaked into the ground; and $2,140.74, representing interest and penalty charges from the City. Defendant refused to pay the claim, and this litigation ensued.

The rules regarding the interpretation of insurance policies in Pennsylvania are well established. Since the policy is a contract, the court must ascertain the intent of the parties as manifested in the language of the agreement. Treasure Craft Jewelers v. Jefferson Insurance Co., 583 F.2d 650, 652 (3d Cir.1978); Standard Venetian Blind Co. v. American Empire Insurance Co., 503 Pa. 300, 469 A.2d 563 (1983). The policy is to be viewed in its entirety, Treasure Craft Jewelers, 583 F.2d at 652, with terms given their plain and ordinary meaning, Hofing GMC Truck, Inc. v. Kay Wheel Sales Co., 543 F.Supp. 414, 417 (E.D.Pa. 1982). Since the policy is normally drafted by the insurer, ambiguities must be resolved in favor of the insured. Treasure Craft Jewelers, 583 F.2d at 652; Hofing, 543 F.Supp. at 417.

The policy issued by defendant to plaintiffs insured against “all risks of direct physical loss.” All risk policies have been interpreted to extend coverage to every loss occasioned by a fortuitous event, except those caused by the willful act of the insured or specifically excluded by the policy. Plaza 61 v. North River Insurance Co., 446 F.Supp. 1168 (M.D.Pa.1978); Miller v. Boston Insurance Co., 420 Pa. 566, 218 A.2d 275 (1966). In Compagnie Des Bauxites v. Insurance Company of North America, 724 F.2d 369 (3d Cir.1983), the Court of Appeals interpreting Pennsylvania law, defined a fortuitous event as “an event which so far as the parties to the contract are aware, is dependent on chance.” Id. at 372.

Defendant argues that the leakage of water into the ground is not a “direct physical loss” and is therefore not covered by the policy. The essence of this argument is that there was no damage to physical structures and therefore no physical.loss. Defendant cites Glen Falls Insurance Co. v. Covert, 526 S.W.2d 222 (Tex.App.1975) for the rule that pecuniary detriment is not the same as physical loss. In Covert, the court held that a policy insuring against “all risks of physical loss or damage” did not cover the loss of sales revenue that occurred when eighty-six safety stabilizers, owned by the plaintiff for eventual sale, fell on the floor without suffering internal damage, although the manufacturer withdrew its warranty causing the products to lose their merchantability.

Defendant’s argument ignores the common-sense meaning of the phrase “physical loss. ” In Hofing GMC Truck, Inc. v. Kay Wheel Sales Co., 543 F.Supp. 414 (E.D.Pa. 1982), a security company was insured against all sums which it became legally obligated to pay as damages because of bodily injury or property damage. The court held that the theft of a truck was property damage since the rightful possessor of the truck had lost the use of it. Id. at 418. If “property damage” includes loss of hse, then “physical loss” presents a stronger case for coverage. When the water passed through the meter, it became the personal property of the plaintiffs. Viewed in this light, defendant’s reliance on Covert is misplaced. Unlike the situation in Covert, the personal property of the •plaintiffs in the instant case was literally lost. Not only did the plaintiff suffer pecuniary loss, it suffered physical loss when the water leaked into the ground. Since the leakage was the result of a fortuitous event, it is a risk covered by the “all-risks” provision.

A finding that the loss of the water into the ground was a “direct physical loss” does not end the inquiry. In order for the plaintiffs to prevail, they must show that the water was the type of property covered by the policy. In the “Policy Coverages” section, the policy states that it provides coverage for

“the replacement cost of the building(s) at the premises described in the Declarations for which a limit of liability is shown, including, all while on the premises, the following:
3. personal property of the insured used for the maintenance and service of the building, including fire extinguishing apparatus, floor coverings, and appliances for refrigerating, ventilating, cooking, dishwashing and laundering.”

When the water passed through the water meter it became the personal property of the plaintiffs and was undoubtedly intended for the “service of the building.” Therefore, since the water was property covered by the policy and it was directly and physically lost due to a fortuitous event, the policy insured against the loss.

Defendant, however, argues that the loss is excluded by the express provisions of the policy, which provide:

“The company shall not be liable for loss: 12. Caused by, resulting from, contributed to or aggravated by any of the following:
(d) water below the surface of the ground including that which exerts pressure on or flows, seeps or leaks through sidewalks, driveways, foundations, walls, basement or other floors, or through doors, windows or any other openings in such sidewalks, driveways, foundations, walls or floors.”

In asserting that this provision excludes the plaintiffs’ loss from coverage, defendant places heavy reliance on Kozlowski v. Penn Mutual Insurance Co., 295 Pa.Super. 141, 441 A.2d 388 (1982). In Kozlowski, the insured was covered by an all risks policy which contained an exclusionary provision identical to the one in the case sub judice. The insured filed a claim under the policy for damage done to her house after the curb valve at the water main to the service line leading to the house of the insured’s neighbor burst, releasing water which seeped into and flooded the insured’s basement. 441 A.2d at 389. The court denied recovery on the grounds that the all risk policy did not cover damage resulting from water emanating from a neighbor’s plumbing system. Id. at 391. It is the defendant’s contention that “the essence of Kolowski [Kozlowski ] is that water discharged from an underground water main fits within the underground water exclusion irrespective of whether it emanates from the insureds or from an outside plumbing source.” [Defendant’s Memorandum of Law at 7] This is an obvious misinterpretation of Kozlowski where the court explicitly held that “where ... the cause of the discharge, leakage or overflow of water is in the insured’s own plumbing system, the exclusion does not apply; but that if the cause is outside that system, then the exclusion is applicable.” Id.

In the case sub judice, the water was lost from the plaintiffs’ plumbing system. When it passed through the water meter, the water entered the plaintiffs’ system. This is demonstrated by the fact that it was the plaintiffs, not the City or a neighbor, that were forced to repair the plumbing at their own expense. The lost water is therefore, not covered by any exlcusionary provision, and since it is property covered by the policy and was subject to direct physical loss due to a fortuitous event, the plaintiff is entitled to summary judgment.

      . The parties agree that Pennsylvania law is applicable to this case.


author: RESTANI, Judge:

text:
    The UNITED STATES, Plaintiff, v. GOLD MOUNTAIN COFFEE, LTD., et al., Defendants.
    Court No. 84-6-00858.
    United States Court of International Trade.
    Dec. 17, 1984.

      Richard K. Willard, Acting Asst. Atty. Gen., David M. Cohen, Director, Commercial Litigation Branch, Kevin C. Kennedy, Civil Div., U.S. Dept, of Justice, Washington, D.C., for plaintiff.
    Barnes, Richardson & Colburn, Andrew P. Vance, Michael A. Johnson, John J. Galvin, New York City, and Carl J. Laurino, Jr., Valley Stream, N.Y., and Kaplan, Russin, Veechi, Eytan & Collins, Mattaniah Eytan, San Francisco, Cal., for defendants.
   OPINION AND ORDER

RESTANI, Judge:

This matter is before the court on plaintiff’s motion, pursuant to 28 U.S.C. § 2646 (1982) and Rule 59 of the Rules of this Court, for rehearing of this court’s opinion and order in this action. 8 CIT —, 597 F.Supp. 510 (1984). That opinion and order granted defendants’ motion to quash plaintiff’s amended warrant for arrest of certain coffee beans.

Now, in its motion for rehearing, plaintiff argues that: (1) plaintiff’s arrest warrant was proper because it was intended to vest in rem jurisdiction in this court; (2) 19 U.S.C. § 1592(c)(5) (1982) contemplates forfeiture in addition to penalties where prohibited merchandise is involved; and (3) coffee beans are prohibited merchandise. Plaintiff does not seek rehearing of the court’s decision declining jurisdiction over plaintiff’s claim under 18 U.S.C. § 545 (1982). For the following reasons, plaintiff’s motion for rehearing is denied in all respects.

A motion for rehearing is addressed to the sound discretion of the court. Nahrgang Co. v. United States, 6 CIT —, Slip Op. 83-108 at 2 (1983), citing Commonwealth Oil Refining Co. v. United States, 60 CCPA 162, 166, 480 F.2d 1352, 1355 (1973). In general, “a rehearing is a method of rectifying a significant flaw in the conduct of the original proceeding.” Nahrgang at 3, citing W.J. Byrnes & Co. v. United States, 68 Cust.Ct. 358 (1972). A rehearing may be proper when there was: (1) an error or irregularity in the trial; (2) a serious evidentiary flaw; (3) a discovery of important new evidence which was not available even to the diligent party at the time of trial; or (4) an occurrence at trial in the nature of an accident or unpredictable surprise or unavoidable mistake which impaired a party’s ability to adequately present its case. Id. In any event, in ruling on a petition- for rehearing, a court’s previous decision will not be disturbed unless it is “manifestly erroneous.” Quigley & Manard, Inc. v. United States, 61 CCPA 65, 496 F.2d 1214 (1974). Furthermore, “arguments raised for the first time on rehearing are not properly before the court for consideration when prior opportunity existed during trial for the moving party to have adequately made its position known.” Wild Heerbrugg Instruments Co. v. United States, 81 Cust.Ct. 141 (1978).

First, plaintiff argues that an arrest warrant is necessary to invest this court with in rem jurisdiction over the coffee beans at issue. Arrest, however, is not necessary to in rem jurisdiction if plaintiff has control of the goods. See Dodge v. United States, 272 U.S. 530, 532, 47 S.Ct. 191, 192, 71 L.Ed. 392 (1926). See also United States v. One 1977 Mercedes Benz, 708 F.2d 444, 450 (9th Cir.1983), cert. denied, — U.S. -, 104 S.Ct. 981, 79 L.Ed.2d 217 (1984); Interbartolo v. United States, 303 F.2d 34, 38-39 (1st Cir.1962); Fraser, Actions In Rem, 34 CORNELL L.Q. 29, 38 (1948). Even if in rem relief is appropriate, which the court found not to be the case here, there is simply no necessity for the arrest of the beans in order for this court to render an enforceable judgment of forfeiture.

Second, plaintiff argues, as it did in its previous briefs, that § 1592(c)(5) provides for forfeiture in addition to monetary penalties where prohibited merchandise is involved. Plaintiff’s interpretation of that section is that prohibited goods should be forfeited under § 1592 regardless of the penalty assessed. The basis of this argument is that the statute provides that prohibited goods, when properly seized, need not be returned by the Secretary upon the deposit of security for any penalties which may be assessed. 19 U.S.C. § 1592(c)(5).

Plaintiff here seeks to sustain a court imposed arrest of property although seizure by the Secretary of the Treasury (“Secretary”) is authorized only upon a specific statutory basis. For the court to uphold the arrest of the goods on plaintiffs unsupported request, would be to ignore the statutory scheme provided for under § 1592. Neither party has made a showing to the court as to what determinations the Secretary made pursuant to § 1592 regarding these coffee beans. As long as the government maintains control of the beans pursuant to the voluntary constructive seizure agreement, it is unlikely that the Secretary will be able to involuntarily seize these coffee beans under § 1592. Furthermore, plaintiff has made no showing that the voluntary constructive seizure agreement constitutes the “seizure” contemplated by § 1592. In addition, it is most likely that Congress under § 1592 did not require the return of prohibited goods because almost all such goods are subject to forfeiture under other statutes. As stated previously, § 1592(e)(5) applies largely to interim remedies. It is not the source of another basis for forfeiture. Again, this court rejects plaintiffs interpretation of § 1592 for the reasons stated above and in the court’s previous opinion and order.

Lastly, although plaintiff asserts that the coffee beans are “prohibited merchandise”, it has pointed to no statute defining that term in such a way that would cause one to conclude that these coffee beans are included in the term. Coffee beans are the type of goods that in some situations may be imported and are not the type of goods which must necessarily be forfeited to protect the public or for some other evident reason. In addition, plaintiff’s argument would make the term “restricted merchandise” superfluous. An interpretation of a statute that causes any part of it to be meaningless is strongly disfavored, “every effort [must be] made to give full force and effect to all the language contained therein.” Dart Export Corp. v. United States, 43 CCPA 64, 74 (1956), cert. denied, 352 U.S. 824, 77 S.Ct. 33, 1 L.Ed.2d 48 (1956). In short, plaintiff has made no new argument which might convince the court that the beans are other than “restricted” goods, as the court concluded in its previous opinion.

In summary, the government’s brief advances no argument that the court did not consider in its first decision. Cf. Jarvis Clark Co. v. United States, 739 F.2d 628 (Fed.Cir.1984) (denying petition for rehearing). Moreover, the court’s earlier decision is neither “significantly flawed” nor “manifestly erroneous.” Consequently, plaintiff has presented no acceptable grounds for rehearing.

Accordingly, plaintiff’s motion for rehearing is denied and the court’s previous decision to quash plaintiff’s amended warrant for the arrest of the coffee beans remains.

      . 19 U.S.C. § 1592(c)(5) (1982) provides:
      If the Secretary has reasonable cause to believe that a person has violated the provisions of subsection (a) of this section and that such person is insolvent or beyond the jurisdiction of the United Státes or that seizure is otherwise essential to protect the revenue of the United States or to prevent the introduction of prohibited or restricted merchandise into the customs territory of the United States, then such merchandise may be seized and, upon assessment of a monetary penalty, forfeited unless the monetary penalty is paid within the time specified by law. Within a reasonable time after any such seizure is made, the Secretary shall issue to the person concerned a written statement containing the reasons for the seizure. After seizure of merchandise under this subsection, the Secretary may, in the case of restricted merchandise, and shall, in the case of any other merchandise (other than prohibited merchandise), return such merchandise upon the deposit of security not to exceed the maximum monetary penalty which may be assessed under subsection (c) of this section.

      . Under § 1592, forfeiture (the in rem relief under discussion) will ordinarily not be permitted unless the monetary penalty imposed is not paid. 19 U.S.C. § 1592(c)(5). Thus, all prerequisites to forfeiture have not yet occurred.

      . See, e.g. 19 U.S.C. § 1305 (immoral articles).


text:
    The UNITED STATES, Plaintiff, v. GOLD MOUNTAIN COFFEE, LTD., et al., Defendants.
    Court No. 84-6-00858.
    United States Court of International Trade.
    Dec. 19, 1984.

      Richard K. Willard, Acting Asst. Atty. Gen., David M. Cohen, Director, Commer.cial Litigation Branch, Kevin C. Kennedy, Civil Division, U.S. Dept, of Justice,'Washington, D.C., for plaintiff.
    Barnes, Richardson & Colburn, New York City (Andrew P. Vance, Michael A. Johnson, John J. Galvin, New York City and Carl J. Laurino, Jr., Valley Stream, N.Y., and Kaplan, Russin, Vecchi, Eytan & Collins, Mattaniah Eytan, San Francisco, Cal., for defendants.
   Opinion, and Order

RESTANI, Judge:

Plaintiff, the United States of America, brings this action for penalties and forfeitures alleging that defendants Gold Mountain Coffee, Ltd., Gold Mountain Holdings, Ltd., and Teck Hock and Company, Ltd. made false statements in connection with the importation of coffee beans labeled as originating in the Peoples’ Republic of China. Defendants counterclaim, inter alia, for damages alleging improper detention and seizure of the coffee beans. Plaintiff seeks partial summary judgment dismissing the counterclaims based on lack of jurisdiction and the doctrine of sovereign immunity. Plaintiff also opposes defendants’ motions to amend their counterclaims. Defendant Teck Hock & Co., Ltd. clearly states in its motion to amend counterclaim that it seeks only recoupment in its counterclaim for damages. The Gold Mountain defendants do not so clarify their counterclaim and they seek to amend it to allege violations of contractual and constitutional rights.

Although 28 U.S.C. § 1583 may provide a basis of jurisdiction over the claims at issue, the right of counterclaim under § 1583 does not provide a waiver of sovereign immunity beyond that allowed by other law. Court of International Trade (“CIT”) Rule 13(c). Defendants’ mere allegations of unconstitutional taking of property, tortious conduct or breach of implied contract are not adequate assertions of authority for this court to render judgments which would be satisfied from the Treasury of the United States. It is possible that these types of claims may be brought in the Claims Court, the district court, or this court. Defendants, however, have not pointed to a statutory waiver of sovereign immunity for suit in this or any other federal court which would permit a monetary judgment in defendants’ favor. Nor have defendants demonstrated a jurisdictional basis for suit in another court. Without such showings, action by this court on defendants’ affirmative claims or transfer of the claims to another court is inappropriate. Therefore, the court will consider defendants’ monetary counterclaims as claims for recoupment only.

Recoupment is in the nature of a defense. It requires no waiver of sovereign immunity because the government necessarily consents to adjudication of the entire transaction when it files suit with regard to that transaction. Frederick v. United States, 386 F.2d 481, 489 (5th Cir. 1967). See also 3 J. Moore, MOORE’S FEDERAL PRACTICE H 13.28, (2d ed. 1984). Recoupment implies a balancing of credits. Therefore both plaintiff’s and defendants’ claims must give rise to the same type of relief. Frederick v. United States at 488; United States v. Ameco Electronic Corp., 224 F.Supp. 783, 786 (E.D.N.Y.1963). Insofar as plaintiff’s claim here involves forfeiture of goods, recoupment is not permitted. Insofar as plaintiff seeks a money judgment, a claim in recoupment reducing the amount of such judgment is possible.

Still, recoupment requires that plaintiff’s and defendants' claims involve the same transaction. Plaintiff argues that its claim turns on defendants’ conduct in the importation of the coffee beans, whereas defendants’ claims involve the detention and seizure of the beans. Because all claims involve the same coffee beans and the detention and seizure resulted directly from the importation of the beans, all claims fall within a broad definition of claims arising from the same transaction. Plaintiff might argue that the definition of “same transaction” should be narrowed where a sovereign function such as customs penalty collection is involved. Although the sovereign versus proprietary distinction may be important on occasion, the court recognizes that it is often anything but “distinct.” For example, even though Frederick involved loan collection rather than a tax or customs dispute, the loans in Frederick were made to further public policy interests and were not for purely commercial purposes. As will be demonstrated, the court finds that the presence of admittedly sovereign functions in this case does not warrant disregard of the well-established right to recoupment.

One of the principal cases cited by plaintiff, EEOC v. 1st National Bank of Jackson, 614 F.2d 1004 (5th Cir.), cert. denied, 450 U.S. 917, 101 S.Ct. 1361, 67 L.Ed.2d 342 (1980), may be viewed as a case where the “same transaction” element of recoupment was lacking. In that case the court found a related malicious prosecution claim against the United States too tenuously and indirectly connected to the unlawful discrimination claim brought by the United States to qualify as a claim in recoupment. Underlying that decision, however, appears to be the court’s concern that Congress clearly intended that the sovereign not be sued in an original action on account of the particular tort at issue. This concern was made more evident in United States v. Carson, 360 F.Supp. 842 (S.D.Tex.1973) where the court first cites Frederick as permitting recoupment absent a statutory waiver of sovereign immunity, but denies recoupment on the basis of the lack of such a waiver in the Federal Tort Claims Act (“FTCA”), 28 U.S.C. § 2671 et seq. (1982). The question posed by the FTCA did not plague the Frederick court because it was able to find a contractual duty which the United States owed the defendant. That duty arose from the very same contract on which the United States sued. This court, however, is troubled by the clearly expressed policy of the FTCA that the United States not be subject to tort damages when its customs officials detain goods. See footnote 3 supra. Nonetheless, this court rejects the notion found in United States v. Carson, 360 F.Supp. 843 (S.D.Tex.1973), that the FTCA is something other than a statute waiving sovereign immunity.

It is the very lack of necessity of a statutory waiver of sovereign immunity which distinguishes counterclaims for recoupment from counterclaims seeking more far-reaching relief. The case of Bull v. United States, 295 U.S. 247, 55 S.Ct. 695, 79 L.Ed. 1421 (1934) (involving tax collection), makes clear that even when the United States is acting in its sovereign capacity, it must seek equity in order to recover a money judgment. If one accepts the principle stated in Bull — that recoupment is a matter of equity — the ordinary sovereign immunity protections simply do not apply in a case of recoupment. Because this is a matter of equity, it is irrelevant whether the recoupment claim, sounds in . tort and may not be heard as an original claim in any court, or whether it is some other type of claim which may be cognizable as an original claim in some court. Therefore, the lack of a waiver of sovereign immunity in the FTCA for this claim does not bar recoupment.

To avoid penalizing defendants beyond the penalties set forth in 19 U.S.C. § 1592, the court must determine whether defendants were legally injured by the detention and seizure. A fair and equitable judgment cannot be rendered without doing so. Since plaintiff must prevail on its related claim in order for the right of recoupment to arise, it will be difficult for defendants to recoup any damages.- Nonetheless, the court is unprepared at this early stage to state that there is no scenario under which defendants will succeed in establishing their recoupment claims.

Apart from the tort theory of damages, the Gold Mountain defendants have raised claims based on an implied contract of bailment and an unconstitutional taking of property. Plaintiff has challenged these counterclaims on .the grounds of lack of jurisdiction and sovereign immunity (failure to state a claim). The merits have not been addressed. As indicated, the right of recoupment applies to all types of claims. Thus, in this case a recoupment claim sounding in contract or based on the Constitution will not be barred on the basis of lack of jurisdiction or the absence of a statutory waiver of sovereign immunity.

Since the Gold Mountain defendants have not prayed for relief under their constitutional and contractual counterclaims, the court will not permit their motion to amend to add the counterclaims in their present form. Therefore, the Gold Mountain defendants are directed to file their recoupment counterclaim in a proper form within ten days of this date, if they wish the court to hear such a claim.

Accordingly, plaintiffs motion for partial summary judgment is denied, defendant Teck Hock’s motion to amend its counterclaim is granted, and the Gold Mountain defendants’ motion to amend their counterclaim is denied, but permission is granted to file a counterclaim in the form indicated by the court.

      . The court previously ruled in this case that it has no jurisdiction over forfeiture actions under 18 U.S.C. § 545 (1982) and that the right to judicially ordered forfeiture under 19 U.S.C. § 1592 (1982) is limited. 8 CIT -, 597 F.Supp. 510 (1984) rehearing denied, 601 F.Supp. 212 (1984).

      . Plaintiff does not seek dismissal of defendants’ counterclaims for entry or release of property. Jurisdiction exists under 28 U.S.C. § 1583 (1982) to hear such claims, and these nonmonetary claims are not barred by the doctrine of sovereign immunity. See Newsom v. Vanderbilt University, 653 F.2d 1100, 1107 (6th Cir.1981).

      . Defendant Teck Hock and the plaintiff seem to be in agreement that there is no waiver of sovereign immunity in any court for an affirmative tort claim against the United States arising from detention or seizure of goods by customs officials. See 28 U.S.C. § 2680(c) (1982); Kosak v. United States, —— U.S. -, 104 S.Ct. 1519, 1523-26, 79 L.Ed.2d 860 (1984); Siaca v. United States, 1 CIT —, Slip Op. 84-5 at 3-6 (January 26, 1984).

      . See United States v. Federal Insurance Co., 7 CIT-, Slip Op. 83-118 (Nov. 15, 1983).

      . See Bar Bea Truck Leasing Co. v. United States, 4 CIT 70, 80, 546 F.Supp. 558, 566 (1982), rev'd on other grounds, 713 F.2d 1563 (Fed.Cir.1983).

      . It is this proposition for which United States v. 2116 Boxes of Bond Beef, 726 F.2d 1481 (10th Cir.), cert. denied sub nom., Jarboe-Lackey Feedlots, Inc. v. United States, — U.S.-, 105 S.Ct. 105, 83 L.Ed.2d 49 (1984) and United States v. Lockheed L-188 Aircraft, 656 F.2d 390 (9th Cir. 1979) (cited by plaintiff) may be said to stand, and not for the broader proposition that recoupment requires a specific statutory waiver of sovereign immunity.

      . The Court of International Trade has sufficient equitable jurisdiction to hear the recoupment claim. 28 U.S.C. § 1585. No separate jurisdictional provision is required.

      . Plaintiff does assert that defendants’ implied contract claim cannot succeed because an express contract exists. This issue was addressed only in passing.

      . In addition, a new answer and integrated counterclaim should have been lodged with the court, not the piecemeal amendment provided.


author: FRANK A. KAUFMAN, Chief Judge.

text:
    PROPERTY OWNERS ASSOCIATION OF DEEP CREEK LAKE, INCORPORATED, et al. v. Ann M. GORSUCH, etc., et al.
    Civ. No. K-82-2869.
    United States District Court, D. Maryland.
    March 16, 1983.

      M. Natalie McSherry, Alfred L. Scanlon, Jr., Edward F. Houff, and Whiteford, Taylor, Preston, Trimble & Johnston, Baltimore, Md., for plaintiffs.
    J. Frederick Motz, U.S. Atty., Robert McDonald, Asst. U.S. Atty., Baltimore, Md., David R. Collins, U.S. Dept, of Justice, Washington, D.C.; and Renee Sarajian, U.S. E.P.A., Philadelphia, Pa., for defendants Gorsuch, Bibko, Bulman & U.S. E.P.A.
    Stephen H. Sachs, Atty. Gen., of Md., Marc K. Cohen, Asst. Atty. Gen., of Baltimore, Md., for defendants Buck and Eichbaum.
    Gorman E. Getty, III, and Carscaden, Gilchrist, Getty & Leasure, Cumberland, Md., for defendants Garrett County, Md. and Garrett County Sanitary Dist.
    H. Russell Smouse, Stephen B. Caplis, and Melnicove, Kaufman, Weiner & Smouse, Baltimore, Md., for defendant Garrett County, Md.
    Warren Rich, and Niles, Barton & Wilmer, Easton, Md., for defendant Garrett County Sanitary Dist.
   MEMORANDUM AND ORDER

FRANK A. KAUFMAN, Chief Judge.

(1) A lengthy hearing was held in this case on the record on February 16, 1983. At that time, for reasons set forth on the record, this Court concluded that none of the grounds for relief stated by plaintiffs entitled them to any relief except perhaps in connection with two areas of plaintiffs’ complaint. With regard to one such area, this Court asked for further briefing by the parties which their counsel have, since February 16, 1983, done.

(2) In connection with the first of those two areas of inquiry — the area not further briefed by counsel since February 16,1983 — plaintiffs allege violations by one or more or all of defendants of the Clean Water Act, 33 U.S.C. § 1251 et seq., on the ground that defendant Garrett County Sanitary District has failed to comply with the sludge disposal reporting requirements of a National Pollutant Discharge Elimination System (NPDES) permit for the Deep Creek sewerage facility and that the federal, state and county defendants herein have failed to enforce said reporting requirements. That NPDES permit, which was issued by the Maryland Water Resources Administration (WRA) under authority delegated to it by the U.S. Environmental Protection Agency pursuant to 33 U.S.C. § 1342, provides in section II C thereof that “[wjithin 90 days of the effective date of this permit” a report shall be furnished to the WRA concerning, inter alia, the method and location used by the permittee for sludge disposal. Although the face of the permit is clearly marked “Effective Date, March 7, 1980,” and defendant Garrett County Sanitary District acknowledges that no such report was furnished within the required time period, it seems plain both from the text of the reporting provision and in common sense that the reporting requirement can meaningfully be applied only to an existing and operating sewerage treatment facility. That approach is in fact contained in a letter addressed to defendant Garrett County Sanitary District by Jeffrey L. Reim, Chief, Division of Sewerage of the State Water Resource Administration, dated December 26, 1982, in which Mr. Reim states that the 90 day reporting requirement “would obviously be applicable only to existing and presently operating facilities.” In any event, defendant Garrett County Sanitary District did provide information regarding sludge disposal to the state on November 10, 1982, and did state during the course of the hearing on February 16, 1983 that information regarding sludge disposal will be provided to the state prior to any such disposal. Accordingly, it would appear that no violation of the NPDES permit nor of the Clean Water Act has occurred. If, in the future, defendant Garrett County Sanitary District should violate the NPDES permit, plaintiffs may seek such relief, if any, as is then appropriate and the within judgment for defendants shall be no bar thereto. Whether, if any such relief is sought in this Court, this Court would have subject matter jurisdiction is a question which this Court need not and does not reach at this time.

(3) Plaintiffs’ basic thrust in this case has been and is that one or more or all of defendants have violated the National Environmental Policy Act of 1969 (NEPA), as amended, 42 U.S.C. § 4321 et seq., because the U.S. Environmental Protection Agency (EPA) did not prepare an Environmental Impact Statement (EIS) for the Deep Creek project. NEPA requires federal agencies to prepare an EIS for “major federal actions significantly affecting the quality of the human environment.” 42 U.S.C. § 4332(2)(c). No EIS is required, however, when an appropriate federal agency concludes on the basis of an environmental assessment that a proposed action will not have a significant environmental affect. An agency may then issue a negative declaration, 40 C.F.R. § 6.104(e) (1979), or a finding of no significant impact (FONSI), 40 C.F.R. § 6.507(e) (1980). In the within case, the EPA issued a negative declaration in 1977 and a FONSI in 1981 with respect to the Deep Creek Project.

During the February 16, 1983 hearing, this Court noted that the scope of this Court’s review of those decisions of the EPA is limited to a determination that the EPA acted neither arbitrarily or capriciously. See Providence Road Community Association v. EPA, 683 F.2d 80 (4th Cir. 1982). A higher “reasonableness” standard of review may be required where a plaintiff raises a “substantial environmental issue concerning the proposed project” by alleging facts which “were not considered in the administrative record and which, if true, would constitute a ‘substantial impact on the environment.’ ” Id. at 82 n. 3, quoting from Winnebago Tribe of Nebraska v. Ray, 621 F.2d 269, 271 (8th Cir.1980).

During the February 16, 1983 hearing this Court examined in detail each of plaintiffs’ factual allegations and concluded, after review of the administrative record and of all of plaintiffs’ submissions, that there was no evidence that the EPA acted neither unreasonably or arbitrarily and capriciously. Moreover, in no instance did plaintiffs show or have plaintiffs shown up to this date that the EPA omitted consideration of any factor which would amount to a “substantial environmental impact” or even a significant environmental impact. However, during the February 16,1983 hearing, this Court did request additional briefing by counsel on both sides in connection with plaintiffs’ allegations that the EPA failed adequately to perform a cost-effectiveness analysis of the proposed project and alternatives thereto, as required by 40 C.F.R. § 6.507(c)(5) and 40 C.F.R. § 35.917-l(d), because certain cost data for grinder pump maintenance were omitted or underestimated in any such analysis. That is the second of the two areas in connection with which this Court withheld final determination at the close of the February 16, 1983 hearing.

After considering all of the memoranda and documents filed by the parties and the entire record herein, this Court hereby concludes, contrary to plaintiffs’ contentions, that documents in the administrative record establish that cost-effectiveness analyses were performed and that cost data for grinder pump maintenance and replacement were incorporated into such analyses. Specifically, in the cost-effectiveness analysis performed by the engineering firm of Rummel, Klepper & Kahl, Administrative Record Document No. 95, an operating and maintenance figure for a sample portion of the pressure sewer system appears specifically to account, in one of the accompanying tables, for labor costs associated with grinder pump maintenance for the purpose of comparing that system with a proposed alternative. In another such table, there is a specific line item for grinder pump replacement, which appears to be based on a replacement cost of $1,500 per pump. A similar inclusion is found in the later cost-effectiveness analysis performed concerning the proposed expansion of the Deep Creek project. See Administrative Record Document No. 107. In Table 3 thereof, there are line items for grinder pump replacement costs and for overall system operation and maintenance. It is unclear whether that latter figure includes maintenance costs associated with grinder pumps other than their replacement cost. In the engineering reports for the basic and expanded systems, there are indications that cost estimates were based upon bid prices for similar construction projects, appropriately adjusted, and upon manufacturer’s quotations. There would appear to be no reason why this Court should question such cost estimates, which neither appear nor have been shown to be unreasonable. However, even if it were so shown, for the purposes of the cost-effectiveness analysis comparing the basic system with the alternatives for expanded systems, any omission of grinder pump maintenance costs would appear to be irrelevant insomuch as such costs would seemingly vary in proportion to the size of the project. I.e., the results of such cost-effectiveness analysis would not necessarily change.

It is true that such omission, could affect the bottom-line estimate of user costs. Plaintiffs have stressed that grinder pump maintenance and replacement costs are not reflected, or, at the most, are reflected only inadequately in the calculation of user costs, at least in the documents dated May 29, 1982 and January 13, 1983 which were distributed at public meetings, and which are attached to plaintiffs’ memorandum dated February 18, 1983. In the earlier of those two documents, no such cost item is included at all, and in the latter, the sinking fund line item would seem to have been based upon a replacement cost estimate far below the replacement cost estimates set forth elsewhere in grinder pump cost data concerning the project. But even so assuming, arguendo only, and even if it be further assumed that the user cost estimates are too low, all of that would not provide plaintiffs with a meritorious basis for relief in the within case. That is because no provision of NEPA or of the regulations promulgated thereunder or of any other act or regulation requires anything more than that an EPA environmental assessment include an evaluation of alternatives to the project, see 40 C.F.R. § 6.507(c)(5), an evaluation which takes into account the cost-effectiveness analysis performed as part of the grant approval process. See 40 C.F.R. § 35.917-l(d), 40 C.F.R. Part 35, Appendix A.

With regard to comparison of alternatives to the project at hand, there is abundant evidence in the administrative record that adequate and reasonable administrative screening of project alternatives, including their cost features, in fact took place.

Nevertheless, plaintiffs contend that projected cost figures for the project exceed the benchmark user cost figures which the EPA employs to determine the financial affordability of a proposed project. Such benchmark figures are set forth in EPA memoranda and are seemingly nothing more than internal, non-binding guidelines used by that agency. Additionally, it is to be noted that if and when such benchmark figures are in fact exceeded, the EPA may take one of several actions, such as to review the appropriateness of required sewerage treatment levels, to reevaluate the cost-effectiveness of the project alternatives, or to investigate supplemental funding sources. See Supplemental Affidavit of Garrison D. Miller, paragraph 8 and Exhibit I thereto.

During the February 16, 1983 hearing, it was observed that every estimate of user costs found in the administrative record appears to be below the benchmark figure. But even assuming that those estimates were too low, again arguendo only, plaintiffs have produced no authority nor is this Court aware of any authority indicating that the failure of the EPA to apply its internal benchmark figures gives rise to a cause of action under either NEPA or the Clean Water Act. Rather, as this Court stated at the February 16, 1983 hearing, even if it be assumed that the purely economic impacts of the project were not adequately considered by the EPA, that alone is not sufficient to trigger the requirement that an EIS be prepared. See e.g., Providence Road Community Association v. EPA, 11 E.L.R. 20780 (W.D.N.C.1981). Therein, Judge McMillan wrote (at 20782): “As plaintiffs have failed to establish any impacts upon the physical or natural environment, an economic impact, even if it could be shown, is insufficient to surpass the NEPA threshold requiring the preparation of an impact statement. Breckinridge v. Rumsfeld, 537 F.2d 864 [6 ELR 20597] (6th Cir.1976), cert. denied, 429 U.S. 1061, 97 S.Ct. 785, 50 L.Ed.2d 777 (1977); Metlakatla Indian Community v. Adams, 427 F.Supp. 871, 874-875 [7 ELR 20407] (D.D.C.1977), 40 C.F.R. § 1500.14 (1980).” That assessment is as equally applicable in this case as it was in Providence Road. In the Breckinridge case cited by Judge McMillan, then Chief Judge Phillips stated (at 866): “Although factors other than the physical environment have been considered [in other cases], this has been done only when there existed a primary impact on the physical environment.” The administrative determination that such a primary impact does not exist in the within case is adequately supported by the administrative record and is one which this Court will not disturb for reasons set forth in more detail on the record during the hearing on February 16, 1983.

(4) In sum, for the reasons set forth during the February 16, 1983 hearing, and in the within Memorandum and Order, defendants’ motions for summary judgment are hereby granted and judgments are hereby entered for defendants.


author: McGLYNN, District Judge.

text:
    JEWISH EMPLOYMENT AND VOCATIONAL SERVICE, INC. v. PLEASANTVILLE EDUCATIONAL SUPPLY CORP., Charles L. Kass, Joseph Kass and Progressive Systems Corp.
    Civ. A. No. 81-847.
    United States District Court, E.D. Pennsylvania.
    April 19, 1983.

      Alan H. Bernstein, Caesar, Rivise, Bernstein & Cohen, Philadelphia, Pa., for plaintiff.
    Harry A. Rutenberg, Philadelphia, Pa., for defendants.
   MEMORANDUM

McGLYNN, District Judge.

This is a petition under 15 U.S.C. § 1117 and 17 U.S.C. § 505 by the prevailing plaintiff for an award of counsel fees for the legal services performed in connection with the trademark and copyright aspects of this litigation. Plaintiff seeks $55,537.50.

Defendants object contending (1) the hours are excessive, (2) the rates are excessive, (3) the time is not properly apportioned between the compensable and noncompensable hours and (4) the statute does not authorize the award of counsel fees in connection with the enforcement of a non-registered trademark.

It seems to me that these issues are largely academic because of the fee arrangement between the plaintiff and its counsel. The agreement provided that counsel would bill the client at one-half the usual rate but would seek to recover fees at the full rate in which event the client would receive the excess.

The allowance of counsel fees is one of the remedies involved in the statutory enforcement scheme and is designed to repay the client for the actual expenses incurred in prosecuting the action. The statutes do not contemplate that the fee petition engender a profit to the client over and above the amount required to be expended.

Accordingly, plaintiff’s request will be cut in half resulting in a fee award of $27,768.75.

Because of my familiarity with the proceedings in this matter I am satisfied that this sum would be well within the guidelines established by Lindy Bros. Builders, Inc. v. American Radiator and Standard Sanitary Corp. (Lindy I), 487 F.2d 161 (3d Cir.1973) and its progeny, thus making a detailed examination of the time and rates unnecessary.