source: Caselaw Access Project

author: THOMAS, Chief Judge:

license: Public Domain

text:
    Joann DAVIS, an individual; Paul Cilley, an individual, Plaintiffs-Appellees, v. UNITED STATES of America; Norman Conley, Defendants-Appellants.
    No. 15-55671
    United States Court of Appeals, Ninth Circuit.
    Argued and Submitted February 8, 2017 Pasadena, California
    Filed April 13, 2017

      John K. Rubiner (argued), Gerard Fox Law P.C., Los Angeles, California; Steven I. Wallach, Gerard Fox Law P.C., New York, New York; for Defendants-Appellants.
    Peter B. Schlueter (argued), Schlueter Law Firm PC, Redlands, California, for Plaintiffs-Appellees.
    Before: SIDNEY R. THOMAS, Chief Judge, and ANDREW J. KLEINFELD and JACQUELINE H. NGUYEN, Circuit Judges.
   OPINION

THOMAS, Chief Judge:

In this appeal, we consider whether a federal agent is entitled to qualified immunity from suit for detaining an elderly woman in a public parking lot for two hours, while she stood in urine-soaked pants, to question her, incident to a search, about her possession of a paperweight containing a rice-grain-sized bit of lunar material. We conclude he is not, and we affirm the judgment of the district court.

I

Joann Davis, and her late husband Robert, worked together at North American Rockwell, which had a contract with the National Aeronautics and Space Administration (“NASA”) in connection with the nation’s space program. By all accounts, Robert was a brilliant engineer, and he ultimately became a manager of North American Rockwell’s Apollo project. While working on the space program, he received many items of memorabilia, including two lucite paperweights. One contained a rice-grain-sized fragment of lunar material, or “moon rock;” the other contained a small piece of the Apollo 11 heat shield. According to unverified family lore, the paperweights were given to Robert by Neil Armstrong in recognition of Robert’s service to NASA.

When Robert died in 1986, Joann retained possession of the paperweights. She married her current husband, Paul Cilley, in 1991. Davis began experiencing financial hardship in 2011. Her son was severely ill, having had over 20 surgeries and requiring expensive medical care. In addition, she unexpectedly had to raise several grandchildren when their mother, Davis’s youngest daughter, died.

Her son suggested that the paperweights might have value, so Davis began contemplating selling them to cover some of his medical costs. She contacted some public auction houses, without success, so she then contacted NASA via email for assistance in “findfing] a buyer for 2 rare Apollo 11 space artifacts.” She explained that “[b]oth of these items were given to [her late husband] by Neil Armstrong,” and that “[he] was very instrumental in all of the space programs right up until his death in February of 1986.”

Davis’s email was forwarded to the NASA Office of Inspector General at the Kennedy Space Center in Florida, where Norman Conley was a special agent and criminal investigator. Conley’s supervisor instructed him to investigate whether Davis indeed possessed a moon rock and to obtain a Registered Confidential Source to initiate telephone contact with her. A few hours after Davis sent the email, Conley’s source called her, posing as a broker named “Jeff” who previously worked on the “space-shuttle program,” was well-known at NASA, learned of Davis’s email to NASA, and would help her sell the paperweights.

Over the course of seven phone calls with “Jeff,” all of which were recorded but the first, Davis expressed concern that the paperweights would be confiscated by NASA unless she could somehow prove they were actually a gift to her late husband; she told “Jeff’ that she had spoken with her accountant regarding her tax liability for the sale because she could not “hide stuff’ and was “not that kind of person”; and she explained that she wanted to “do[] things legally” because she is “just not an illegal person.” “Jeff’ responded, agreeing that “you and I are both legal people,” but “the sale of a moon rock ... can’t be done publicly.”

In a later call, Davis told “Jeff’ that she heard of someone serving a prison sentence for selling lunar material, but she understood her situation to be different because her late husband received the paperweights as a gift. At no point did “Jeff’ or Conley inform Davis that all lunar material is property of the U.S. government or that her possession of the paperweights was illegal. Davis also mentioned during these conversations that, because her former husband worked for the Bureau of Alcohol, Tobacco, Firearms, and Explosives, she had several firearms in her home that she was trying to sell.

Based on these phone calls, Conley obtained a warrant to search Davis and seize the moon rock paperweight. In his affidavit supporting the warrant, Conley stated that he believed Davis was “in possession of contraband, evidence of the crime, fruits, and instrumentalities of the crime concerning a violation of [18 U.S.C. § 641].”

To execute the warrant, “Jeff’ made arrangements with Davis to meet around noon on May 19, 2011, at a Denny’s Restaurant located in Lake Elsinore, California. Davis believed the purpose of this meeting was to finalize the sale of the paperweights. In fact, it was a government sting operation to séize the moon rock paperweight.

Davis proceeded to meet with “Jeff’ at the restaurant. She was accompanied by Cilley, who was approximately 70 years old. At the time of the incident, Davis was 74 and 4T1” tall. Three armed federal agents and three Riverside County Sheriffs personnel were present, but not visible.

Once Davis, Cilley, and “Jeff’ were seated in a booth inside the restaurant and exchanged pleasantries, Davis placed the paperweights on the table. “Jeff’ said he thought the heat shield was worth about $2,000. Shortly thereafter, Conley announced himself as a “special agent,” and another officer’s hand reached over Davis, grabbed her hand, and took the moon rock paperweight. Simultaneously, a different officer grabbed Cilley by the back of the neck and restrained him by holding his arm behind his back in a bent-over position. Then, an officer grabbed Davis by the arm, pulling her from the booth. At this time, Davis claims that she felt like she was beginning to lose control of her bladder. One of the officers took her purse. Both Cilley and Davis were compliant. Four officers escorted them to the restaurant parking lot for questioning after patting them down to ensure that neither was armed. At some point before the escort, Conley left the restaurant and went to the parking lot.

Davis claims that she told officers twice during the escort that she needed to use the restroom, but that they did not answer and continued walking her toward an SUV where Conley was waiting. Davis subsequently urinated in her clothing. Although their accounts differ in some respects, Conley and Davis agree that he knew she was wearing urine-soaked pants as he interrogated her in the restaurant parking lot. Davis claims that she was not allowed an opportunity to clean herself or change her clothing, despite communicating to Conley several times that she was “very uncomfortable.”

An officer read the search warrant aloud, and Conley then read Davis her Miranda rights. Conley asked Davis to sit inside the SUV, but Davis declined. Conley then proceeded to question Davis for one- and-a-half to two hours, during which time Davis remained standing in the same place. Davis was never handcuffed that day. Nonetheless, while Conley questioned her, another officer wearing a flack jacket stood behind her and pushed her each time she shifted her weight or stepped backwards. During the questioning, Conley kept Davis’s purse and car keys and told her repeatedly that “they still really want to take you in,” and that she needed to give him more information before he could release her. She was kept from going to her car. At least ninety minutes had passed when Conley told Davis she was free to leave.

After the sting operation was complete and NASA lunar experts were able to confirm the moon rock’s authenticity, Conley opened a full investigation. The investigation was closed when the U.S. Attorney in Orlando, Florida, formally declined to prosecute Davis. Davis’s son died seven months after the incident.

On August 7, 2013, Davis and Cilley filed their first amended complaint against the United States and the NASA officials involved in the incident. Davis and Cilley raised, inter alia, a Bivens claim against Conley for wrongful detention under the Fourth Amendment. See Bivens v. Six Unknown Fed. Narcotics Agents, 403 U.S. 388, 389, 91 S.Ct. 1999, 29 L.Ed.2d 619 (1971) (establishing a private right of action for damages against federal officials who violate the constitutional rights of others). Conley sought summary judgment for the Bivens claim on the ground of qualified immunity. Concluding that genuine issues of material fact existed as to the lawfulness of Davis’s detention, the district court denied Conley’s summary judgment motion. Conley timely appealed.

II

Because Conley raises only legal issues in this interlocutory appeal, we have jurisdiction under 28 U.S.C. § 1291. See Plumhoff v. Rickard, — U.S. -, 134 S.Ct. 2012, 2019, 188 L.Ed.2d 1056 (2014); Behrens v. Pelletier, 516 U.S. 299, 313, 116 S.Ct. 834, 133 L.Ed.2d 773 (1996). We review de novo a district court’s grant or denial of summary judgment. See, e.g., Ariz. Dream Act Coal. v. Brewer, 818 F.3d 901, 908 (9th Cir. 2016). When considering a grant of summary judgment, “[viewing the evidence in the light most favorable to the nonmoving party,” we “must determine whether there are any genuine issues of material fact and whether the district court correctly applied the relevant substantive law.” Oliver v. Keller, 289 F.3d 623, 626 (9th Cir. 2002). On summary judgment, the moving party bears the burden of establishing the basis for its motion and identifying evidence that demonstrates the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986).

Although we must view the facts in the light most favorable to the nonmov-ing party, when considering qualified immunity, we are also limited to considering what facts the officer could have known at the time of the incident. White v. Pauly, - U.S. -, 137 S.Ct. 548, 550, 196 L.Ed.2d 463 (2017) (citing Kingsley v. Hendrickson, — U.S. -, 135 S.Ct. 2466, 2474, 192 L.Ed.2d 416 (2015)). “[S]ummary judgment in favor of moving defendants is inappropriate where a genuine issue of material fact prevents a determination of qualified immunity until after trial on the merits.” Liston v. County of Riverside, 120 F.3d 965, 975 (9th Cir. 1997).

A defendant is not entitled to qualified immunity if “the facts that a plaintiff has alleged or shown make out a violation of a constitutional right,” and that right was “ ‘clearly established’ at the time of [the] defendant’s alleged misconduct.” Pearson v. Callahan, 555 U.S. 223, 232, 129 S.Ct. 808, 172 L.Ed.2d 565 (2009) (quoting Saucier v. Katz, 538 U.S. 194, 201, 121 S.Ct. 2151, 150 L.Ed.2d 272 (2001)) (citations omitted). The Supreme Court recently reiterated that a “clearly established” constitutional right “should not be defined ‘at a high level of generality.’ ” Pauly, 137 S.Ct. at 552 (quoting Ashcroft v. al-Kidd, 563 U.S. 731, 742, 131 S.Ct. 2074, 179 L.Ed.2d 1149 (2011)). Rather, it must be “ ‘particularized’ to the facts of the case.” Id. (quoting Anderson v. Creighton, 483 U.S. 635, 640, 107 S.Ct. 3034, 97 L.Ed.2d 523 (1987)).

Ill

The Fourth Amendment proscribes “unreasonable” searches and seizures. U.S. Const. Amend. TV. A detention can be unreasonable “either because the detention itself is improper or because it is carried out in an unreasonable manner.” Franklin v. Foxworth, 31 F.3d 873, 876 (9th Cir. 1994). We must determine reasonableness “from the perspective of a reasonable officer on the scene.” See Graham v. Connor, 490 U.S. 386, 396, 109 S.Ct. 1865, 104 L.Ed.2d 443 (1989). Davis argues that Conley violated the Fourth Amendment because his detention of her was unreasonably prolonged and degrading, particularly given that she is elderly, her clothing was urine-soaked, the detention took place in a public parking lot, and the moon rock paperweight had already been seized. Viewing the facts in the light most favorable to Davis, we agree.

Under the Fourth Amendment, “a warrant to search for contraband founded on probable cause implicitly carries with it the limited authority to detain the occupants of the premises while a proper search is conducted.” Michigan v. Summers, 452 U.S. 692, 705, 101 S.Ct. 2587, 69 L.Ed.2d 340 (1981). Nevertheless, “special circumstances, or possibly a prolonged detention, might lead to a different conclusion in an unusual case.” Id. at 705 n.21, 101 S.Ct. 2587; see also Muehler v. Mena, 544 U.S. 93, 101, 125 S.Ct. 1465, 161 L.Ed.2d 299 (2005) (“[A] lawful seizure can become unlawful if it is prolonged beyond the time reasonably required to complete that mission.” (internal quotation marks omitted)). For instance, search-related detentions that are “unnecessarily painful [or] degrading” and “lengthy detentions[ ] of the elderly, or of children, or of individuals suffering from a serious illness or disability raise additional concerns.” Foxworth, 31 F.3d at 876. Thus, a “seizure must be ‘carefully tailored’ to the law enforcement interests that ... justify detention while a search warrant is being executed.” Meredith v. Erath, 342 F.3d 1057, 1062 (9th Cir. 2003) (citing Summers, 452 U.S. at 699-705, 101 S.Ct. 2587).

In Foxworth, police officers executed a search warrant at a residence where a suspected gang member engaging in drug activity might be present at the home of his mother and the plaintiff. 31 F.3d at 874. The plaintiff suffered from advanced multiple sclerosis, rendering him bedridden, unable to feed himself or sit up without assistance, and unable to control his bowels. As a result, he wore only a t-shirt in bed. Id. After entering the plaintiffs bedroom with guns drawn and searching the room, officers cuffed his hands behind his back, carried him to the living room, and placed him on a couch with his genitals exposed. Id. at 875. After complaining that the handcuffs were causing him pain and that he was cold and tired from sitting upright, the officers recuffed his hands in front of his body and gave him a blanket. Id. The plaintiff was then forced to sit on the couch for over two hours until the search of the house was complete. Id. We held that the detention was unreasonable. Id. at 878.

Here, Conley does not dispute that he detained Davis in the parking lot for up to two hours. At the time of the detention, Conley was aware of several facts that color the reasonableness of his actions. First, Conley knew that Davis was a slight, elderly woman, who was then nearly seventy-five years old and less than five feet tall. Second, he knew that Davis lost control of her bladder during the search and was wearing visibly wet pants. Third, he knew that Davis and Cilley were unarmed and that the search warrant had been fully executed by the time Davis was escorted to the parking lot. Fourth, Conley knew that Davis had not concealed possession of the paperweights, but rather had reached out to NASA for help in selling the paperweights. Finally, because all but the first of the phone calls between Davis and “Jeff’ were recorded, Conley knew the exact content of most of those conversations, including that Davis was experiencing financial distress as a result of having to raise grandchildren after her daughter died, her son was severely ill and required expensive medical care, and Davis needed a transplant. Those conversations also revealed Davis’s desire to sell the paperweights in a legal manner and her belief that she possessed them legally because they were a gift to her late husband.

Because the moon rock paperweight had been seized and both Davis and Cilley had already been searched for other weapons and contraband, Conley had no law enforcement interest in detaining Davis for two hours while she stood wearing urine-soaked pants in a restaurant’s parking lot during the lunch rush. This is precisely the type of “unusual case” involving “special circumstances” that leads us to conclude that a detention is unreasonable. See Foxworth, 31 F.3d at 876 (quoting Summers, 452 U.S. at 705 n.21, 101 S.Ct. 2587). Conley’s detention of Davis, an elderly woman, was unreasonably prolonged and unnecessarily degrading.

Conley argues that the circumstances surrounding the detention in Foxworth are far more egregious and therefore distinguishable from Davis’s detention. Specifically, Conley argues that, unlike the plaintiff in Foxworth, Davis was suspected of illegal activity and named in the search warrant, she consented to answering questions during the detention, and she was not partially nude or disabled during the detention. However, Foxworth does not require that a detention be so egregious to be found unreasonable. Here, Conley knew significantly more about Davis and the threat she posed — or, more accurately, did not pose — than the officers knew about the plaintiff in Foxworth. Moreover, the search in Foxworth was incomplete, unlike the search here. And the fact that Davis consented to further questioning has no bearing on the reasonableness of the detention. See Foxworth, 31 F.3d at 875.

Nonetheless, Conley argues that the circumstances surrounding Davis’s detention are more closely analogous to cases where the searches were found to be reasonable, such as Crosby v. Hare, 932 F.Supp. 490 (W.D.N.Y. 1996), and Hunter v. Namanny, 219 F.3d 825 (8th Cir. 2000). Not only are these decisions not binding, they are distinguishable. Both Crosby and Hunter involve an embarrassing detention that occurred inside the plaintiffs home while officers conducted a search for illegal drugs. Therefore, in both cases, the officers possessed' law enforcement interests in detaining the plaintiffs, namely to prevent the destruction of evidence and to maintain officer safety. See Crosby, 932 F.Supp. at 495; Hunter, 219 F.3d at 831. Here, conversely, the search was complete, Davis stood detained for up to two hours with urine-soaked pants in view of the public, and Conley had no such interest.

Conley also argues that, because Davis mentioned during' the phone calls with “Jeff’ that she had several, possibly illegal, firearms in her home, he acted reasonably. But when Davis was detained, officers had already confirmed that neither she nor Cilley was armed. Further, Conley arranged the sting operation to take place over the lunch hour at a family restaurant. This fact undermines his contention that he possessed a legitimate concern that Davis and Cilley would come to the meeting armed.

The remaining circumstances leading up to the sting operation further support our conclusion that Conley’s detention of Davis was unreasonable. Based on the conversations between Davis and “Jeff,” Conley knew that Davis' wanted to sell the paperweights because she was experiencing financial hardship, particularly in light of her adult son’s medical condition. He also knew that she believed the paperweights were gifts to her late husband — a belief bolstered by the fact that the artifacts were each encased in a lucite globe, a common gift for honoring a person’s service or accomplishments — and that she was thus in legal possession of them. Finally, he knew that she was elderly, that she intended to sell the paperweights legally, and that she initiated contact with NASA for assistance in doing so. Despite all of this knowledge, Conley did not inform Davis that her possession of the paperweights was illegal or ask her to surrender them to NASA. Instead, he organized a sting operation involving six armed officers to forcibly seize a lucite paperweight containing a moon rock the size of a rice grain from an elderly grandmother.

IV

Considering these facts in the light most favorable to Davis, as well as the facts Conley knew at the time of the detention, the district court correctly concluded that Davis has raised genuine issues of material fact as to whether Conley’s detention of Davis was unreasonably prolonged and degrading under Foxworth, and that Conley was not entitled to qualified immunity as a matter of law.

AFFIRMED.

      . NASA was not interested in seizing the heat shield paperweight because it would be too difficult to verify its authenticity.

      . 18 U.S.C. § 641 reads in part:
      Whoever embezzles, steals, purloins, or' knowingly converts to his use or the use of another, or without authority, sells, conveys or disposes of any record, voucher, money, or thing of value of the United States or of any department or agency thereof, or any property made or being made under contract for the United States or any department or agency thereof; or
      Whoever receives, conceals, or retains the same with intent to convert it to his use or gain, knowing it to have been embezzled, stolen, purloined or converted—
      Shall be fined under this title or imprisoned not more than ten years, or both; but if the value of such property in the aggregate, combining amounts from all the counts for which the defendant is convicted in a single case, does not exceed the sum of $1,000, he shall be fined under this title or imprisoned not more than one year, or both.

      . Conley claims that he offered Davis "a number of remedies” regarding her wet clothing, all of which she refused. However, that factual dispute is not before us on this interlocutory appeal, in which we can only consider legal issues and must construe the facts in the light most favorable to the plaintiff.

      . The district court granted summary judgment as to other issues and other defendants, but those issues are not before us on this interlocutory appeal.


author: TASHIMA, Circuit Judge:

text:
    UNITED STATES of America, Plaintiff-Appellee, v. Ricky DAVIS, aka Rick Dog, aka Ricky Loks, Defendant-Appellant.
    No. 15-10402
    United States Court of Appeals, Ninth Circuit.
    Argued and Submitted February 16, 2017 San Francisco, California
    Filed April 14, 2017
    For additional opinion, see 2017 WL 1364283.

      Peggy Sasso (argued), Assistant Federal Defender; Heather E. Williams, Federal Defender; Office of the Federal Public Defender, Fresno, California; for Defendant Appellant.
    Brian W. Enos (argued), Assistant United States Attorney; Camil A. Skipper, Assistant United States Attorney & Appellate Chief; Phillip A. Talbert, Acting United States Attorney; United States Attorney’s Office, Fresno, California; for Plaintiff-Appellee.
    Before: A. WALLACE TASHIMA and ANDREW D. HURWITZ, Circuit Judges, and LYNN S. ADELMAN, District Judge.

       The Honorable Lynn S. Adelman, United States District Judge for the Eastern District of Wisconsin, sitting by designation.

   OPINION

TASHIMA, Circuit Judge:

Ricky Davis appeals his convictions for sexual exploitation and attempted sex trafficking of a minor, as well as the resulting sentence. We have jurisdiction under 28 U.S.C. § 1291. We affirm Davis’ conviction for sexual exploitation of a minor, but we reverse his conviction for attempted sex trafficking.

I.

On September 17, 2011, Ricky Davis brought thirteen-year-old Bianca to his house. Once there, he discussed the possibility of Bianca making money by going on dates, took sexually explicit photos of her, helped to post these images on a website known for advertising escort services, and introduced Bianca 'to at least one individual with whom Bianca later had sex in exchange for money. Some months later, after two different men had trafficked Bianca, law enforcement discovered the sexually explicit photographs and arrested Davis.

Davis was indicted for (1) sexual exploitation of a minor, in violation of 18 U.S.C. § 2251(a), and (2) attempted sex trafficking either by force or of a minor, in violation of 18 U.S.C. §§ 1591(a), 1594. Davis was convicted on both counts. The district court sentenced him to concurrent 300-month terms of imprisonment.

This appeal followed. Davis challenges his conviction under § 1591(a) on the ground that the district court’s jury instruction constructively amended the indictment.

II.

“When [as in this case] a defendant raises a constructive amendment claim before the district court, we review de novo.” United States v. Ward, 747 F.3d 1184, 1188 (9th Cir. 2014).

III.

A. A Constructive Amendment Occurred.

“The Fifth Amendment’s grand jury requirement establishes the ‘substantial right to be tried only on charges presented in an indictment returned by a grand jury.’ ” United States v. Antonakeas, 255 F.3d 714, 721 (9th Cir. 2001) (quoting United States v. Miller, 471 U.S. 130, 140, 105 S.Ct. 1811, 85 L.Ed.2d 99 (1985)). “A constructive amendment occurs when the charging terms of the indictment are altered, either literally or in effect, by the prosecutor or a court after the grand jury has last passed upon them.” Ward, 747 F.3d at 1190 (internal quotation marks and citation omitted). There are two types of constructive amendment: first, where “there is a complex of facts [presented at trial] distinctly different from those set forth in the charging instrument,” and, second, where “the crime charged [in the indictment] was substantially altered at trial, so that it was impossible to know whether the grand jury would have indicted for the crime actually proved.” United States v. Adamson, 291 F.3d 606, 615 (9th Cir. 2002) (quoting United States v. Von Stoll, 726 F.2d 584, 586 (9th Cir. 1984)). Here, we are concerned with the second type of amendment.

Our decision in United States v. Dipentino, 242 F.3d 1090 (9th Cir. 2001), is an instructive example of the second category.

In Dipentino, the Court considered a constructive amendment challenge to a conviction for violations of the Clean Air Act. Id. at 1093-94. The indictment charged that the defendants had:

... caused quantities of scraped and/or loose asbestos-containing debris to be left on floors and other surfaces where such debris was allowed to dry, instead of causing all such debris to be gathered, while wet, and placed in leak-proof containers or wrappings to be removed from the site, as required by work practice standards promulgated pursuant to the Clean Air Act.

Id. at 1094-95. When instructing the jury, however, the district court defined the charged offense as one in which the defendants “knowingly failed ... to comply with the work practice standards alleged in the indictment.” Id. at 1095. Critically, the district court then defined the relevant work practice standards as requiring that “[a]ll asbestos-containing waste material shall be deposited as soon as is practical by the waste generator at a waste disposal site that meets appropriate federal requirements.” Id.

Because the conduct charged in the indictment was substantially different from the conduct described in the jury instructions, we concluded that “[i]t is evident that the district court constructively amended the indictment because the jury instruction permitted the jury to convict the defendants of violating a work practice standard they were not charged in the indictment with violating!/]” Id.

This case is closely analogous to Dipen-tino. Here, Count 2 of the indictment charges that Davis violated § 1591(a) when he:

... knowingly attempted to recruit, entice, harbor, transport, provide, obtain, and maintain by any means, a person to engage in a commercial sex act, to wit: a minor female victim, ... knowing or in reckless disregard of the fact that the person had not attained the age of 18 years[.]

(Emphasis added.) At trial, however, the jury instruction as to Count 2 provided, in relevant part:

The elements of sex trafficking are: ... (2) knowing that Bianca had not attained the age of 18 years, or recklessly disregarded that fact, or the defendant had a reasonable opportunity to observe Bianca, and that Bianca would be caused to engage in a commercial sex act ... [.]

(Emphasis added.) Elsewhere in the same instruction, the district court charged:

In Count 2 of the Indictment, the defendant is charged with Attempted Sex Trafficking of Children. For the defendant to be found guilty, the Government need not prove that the defendant knew Bianca had not attained the age of 18 so long as the defendant had a reasonable opportunity to observe Bianca. (Emphasis added.)

In its closing argument, the government adopted much the same approach, arguing:

[W]e, again, submit that the evidence shows both, that Bianca had not attained the age of 18, or the defendant recklessly disregarded that fact, or he had a reasonable opportunity to observe Bianca, and that she would be caused to engage in a commercial sex act.

(Emphasis added.)

It is evident that the language of the indictment differs substantially from the jury instruction and the government’s closing argument. Specifically, the indictment charged that Davis knew Bianca was a minor or that he recklessly disregarded this fact. Thus, under the indictment, the government was required to prove, beyond a reasonable doubt, either that Davis affirmatively knew of Bianca’s age, or, alternatively, that he recklessly disregarded her minority status. In contrast, the jury instructions afforded jurors a third option for convicting Davis: namely, they could convict, even without a finding as to knowledge or recklessness, so long as they determined that Davis “had a reasonable opportunity to observe Bianca.”

We thus conclude that a constructive amendment occurred because “the crime charged [in the indictment] was substantially altered at trial, so that it was impossible to know whether the grand jury would have indicted for the crime actually proved.” Adamson, 291 F.3d at 615. See also United States v. Stewart Clinical Lab., Inc., 652 F.2d 804, 807 (9th Cir. 1981) (“The court may not substantially amend the indictment through its instructions to the jury.” (citations omitted)). Our holding today is consistent with United States v. Lockhart, 844 F.3d 501 (5th Cir. 2016), the facts of which are indistinguishable from this case. There, the Fifth Circuit observed:

By including the language found in § 1591(c), the district court materially modified an essential element of the indictment by transforming the offense with which the indictment charged [the defendant] from one requiring specific mens rea into a strict liability offense.

Id. at 515-16 (footnote and citation omitted). We agree.

B. Davis’ Conviction Under § 1591(a) Must Be Reversed.

“Objections that the trial court improperly instructed the jury about the contents of the indictment generally fall into one of two categories: a constructive amendment or a variance.” Ward, 747 F.3d at 1189. And, while “[t]he line that separates a constructive amendment from a variance is not always easy to define,” id. drawing this distinction is nevertheless critical. This is because “a constructive amendment typically mandates reversal, while ‘a variance requires reversal only if it prejudices a defendant’s substantial rights.’ ” Id. (citing Adamson, 291 F.3d at 615, and Antonakeas, 255 F.3d at 722). We have also held that “amending the indictment to charge a new crime constitutes a per se reversible error.” Stewart Clinical, 652 F.2d at 807. See also United States v. Olson, 925 F.2d 1170, 1175 (9th Cir. 1991) (“An amendment always requires reversal, because it deprives a defendant of his right to be tried on the grand jury’s charge.”), abrogated in part by United States v. Cotton, 535 U.S. 625, 630, 122 S.Ct. 1781, 152 L.Ed.2d 860 (2002).

We have previously articulated the distinction between a constructive amendment and a variance:

An amendment of the indictment occurs when the charging terms of the indictment are altered, either literally or in effect, by the prosecutor or a court after the grand jury has last passed upon them. A variance occurs when the charging terms of the indictment are left unaltered, but the evidence at trial proves facts materially different from those alleged in the indictment.

Von Stoll, 726 F.2d at 586 (quoting United States v. Cusmano, 659 F.2d 714, 718 (6th Cir. 1981) (citations omitted)). Here, the district court’s jury instruction and the government’s argument had the effect of altering the terms of the indictment.

Thus, the district court’s error here is properly characterized as a constructive amendment, not as a mere variance. As a result, Davis’ conviction under § 1591(a) must be reversed. See Ward, 747 F.3d at 1189 (citing Adamson, 291 F.3d at 615, and Antonakeas, 255 F.3d at 722).

C. Remand for Resentencing is Required.

The district court sentenced Davis to 300 months’ imprisonment for each count of his conviction, with the terms to run concurrently. Although we affirm Davis’ conviction under § > 2251 in our concurrently-filed memorandum, “[w]hen a defendant is sentenced on multiple counts and one of them is later vacated on appeal, the sentencing package comes ‘unbundled.’ ” United States v. Ruiz-Alvarez, 211 F.3d 1181, 1184 (9th Cir. 2000). Under these circumstances, vacating the sentence is required in order to allow the district court “to put together a new package reflecting its considered judgment as to the punishment the defendant deserve[s] for the crimes of which he ... [remains] ... convicted.” Id. (quoting United States v. McClain, 133 F.3d 1191, 1193 (9th Cir. 1998) (other citations omitted)).

We remand to the district court for re-sentencing on Davis’ single remaining conviction on an open record or, alternatively, for Davis to be retried on the § 1591(a) charge.

IV.

We thus (1) affirm Davis’ conviction under § 2251, (2) reverse his conviction under § 1591(a) on grounds of constructive amendment, (3) vacate the sentence, and (4) remand to the district court for further proceedings consistent with this opinion.

AFFIRMED in part, REVERSED in part, sentence VACATED, and REMANDED.

      . In a concurrently filed memorandum, we address and reject Davis’ arguments not addressed in this opinion.

      . The italicized language is taken from § 1591(c), which further provides that if the government proves the "reasonable opportunity to observe” prong, it is relieved from proving the defendant’s knowledge or recklessness regarding the victim's minority.

      . Because we reverse Davis' § 1591(a) conviction on the constructive amendment ground, we need not reach his other challenges to that conviction. We also do not reach Davis' arguments challenging the propriety or reasonableness of his now-vacated sentence.


author: M. SMITH, Circuit Judge: WALLACE, Circuit Judge,

text:
    Donald WORTMAN, individually and on behalf of all others similarly situated; William Adams; Margaret Garcia; Brenden G. Maloof; Micah Abrams; Martin Kaufman; Rachel Diller; Lori Barrett; Clyde H. Campbell; Matthew Evans; Thomas Schelly; Mark Foy; Jason Gregory Turner; Stephen Gaffigan; Bruce Hut; Dickson Leung; Kevin Moy; Rufus Browning; Lolly Randall; Christian Duke; Andrew Barton; Tracey Wadmore Smith; Michael Benson; Tori Kitagawa; Woodrow Clark, II; James Evans; Meor Adlin; Justin Labarge; Scott Frederick; Reiko Hirai; Ireatha Diane Mitchell; Larry Chen; David Kuo; David Murphy; Titi Tran; Robert Casteel, III, Plaintiffs-Appellees, v. ALL NIPPON AIRWAYS, Defendant-Appellant. Donald Wortman, individually and on behalf of all others similarly situated; William Adams; Margaret Garcia; Brenden G. Maloof; Micah Abrams; Martin Kaufman; Rachel Diller; Lori Barrett; Clyde H. Campbell; Matthew Evans; Thomas Schelly; Mark Foy; Jason Gregory Turner; Stephen Gaffigan; Bruce Hut; Dickson Leung; Kevin Moy; Rufus Browning; Lolly Randall; Christian Duke; Andrew Barton; Tracey Wadmore Smith; Michael Benson; Tori Kitagawa; Woodrow Clark, II; James Evans; Meor Adlin; Justin Labarge; Scott Frederick; Ireatha Diane Mitchell; Larry Chen; David Kuo; David Murphy; Titi Tran; Robert Casteel, III, Plaintiffs-Appellees, v. China Airlines; Eva Airways, Defendants-Appellants.
    No. 15-15362, No. 15-15364
    United States Court of Appeals, Ninth Circuit.
    Argued and Submitted January 13, 2017 San Francisco, California
    Filed April 14, 2017

      Gary J. Malone (argued), Ankur Kapoor, and Alysia Solow, Constantine Cannon L'LP, New York, New York; Douglas R. Rosenthal, Richard 0. Levine, and Aymeric Dumas-Eymard, Constantine Cannon LLP, Washington, D.C.; for Defendant Appellant All Nippon Airways.
    Tammy Tsoumas (argued), Jonathan J. Faria, and Jason Y. Kelly, Kirkland & Ellis LLP, Los Angeles, California; James H. Mutchnik, Chicago, Illinois; for Defendant-Appellant Eva Airways.
    Steven N. Williams (argued) and Adam J. Zapala, Cotchett Pitre & McCarthy LLP, Burlingame, California; Michael P. Lehmann and Christopher L. Lebsock, Hausfeld LLP, San Francisco, California; for Plaintiffs-Appellees.
    Before: J. CLIFFORD WALLACE, RICHARD R. CLIFTON, and MILAN D. SMITH, JR., Circuit Judges.
   Partial Concurrence and Partial Dissent by Judge Wallace

OPINION

M. SMITH, Circuit Judge:

Defendants-Appellants All Nippon Airways (ANA), China Airlines, and EVA Airways (collectively, Defendants) challenge the district court’s holding that the filed rate doctrine does not preclude Plaintiffs-Appellees’ putative class action suit for antitrust damages based on allegations of collusion and price fixing. We have not previously addressed the application of the filed rate doctrine to airline fares and fees. For the reasons set forth in this opinion, we hold that, based on the record in this case, the filed rate doctrine does not preclude Plaintiffs’ suit for antitrust damages challenging Defendants’ unfiled fares, fuel surcharges, or “discount” fares. We therefore affirm the district court’s partial denial of Defendants’ motions for summary judgment.

FACTUAL AND PROCEDURAL BACKGROUND

Plaintiffs claim antitrust violations by Defendants in connection with three categories of Defendants’ charged rates: (1) unfiled fares, (2) fuel surcharges, and (3) special “discount” fares.

The DOT’s present regulations require airlines to file their base-fare rates to differing extents, depending upon whether a particular airline is included within Country Category A, B, or ■ C. Airlines headquartered in or traveling between the United States and a Category A country need not file any fares. Airlines headquartered in or traveling between the United States and a Category C country must file all fares. Finally, airlines headquartered in or traveling between the United States and a Category B country must file certain, but not all, of their fares. Those fares not required to be filed are the “unfiled fares” at issue in this appeal.

In addition to charging base-fare rates, some airlines impose fuel surcharges, which are additional per-ticket fees based on the carrier’s fuel costs. Prior to 2004, the DOT did not permit separate fuel surcharges. Rather, airlines were required to incorporate the cost of fuel into the base ticket price. However, in October 2004, the DOT lifted its prohibition on separate fuel surcharges. The parties dispute whether the DOT required filing of these newly allowed surcharges. Defendants argue that it did, citing a 1999 DOT statement that “all surcharges are to be filed,” while Plaintiffs argue that the DOT’s 1999 statement has no relevance to fuel surcharges given that the DOT did not permit fuel surcharges at the time the statement was made. In any event, the record reflects that regardless of whether the DOT required airlines to file fuel surcharges, in many cases airlines did file them.

Finally, Defendant ANA offers a number of special “discount” fares. These include the “Satogaeri” fares and the “Business Discount,” “Biziwari,” or “Buz-Wari” fares, all of which operate in the same manner: Specifically, ANA files the respective fares with the DOT, then authorizes certain travel agents to sell tickets with more restrictive terms to consumers for some amount less than the filed rate. This lesser amount constitutes the “net fare,” which travel agents remit to ANA as payment for the ticket. The travel agent retains as a commission any difference between the net fare and the amount charged to the consumer.

The terms governing the fares actually filed by ANA differed substantially from the terms governing the discount fares. For instance, while one of ANA’s publicly-filed fares could be used for “circle trips” and “double open jaw trips,” the discounted version of that fare could not. The same public fare had a minimum stay of three days and allowed for a stopover in Japan and up to six transfers, while the discounted fare had no minimum stay, and did not allow stopovers or transfers. Some other of ANA’s filed fares similarly differed from their discounted versions in regard to the types of trips permitted, maximum stay required, the amount of time in advance the ticket needed to be purchased, restrictions on stopovers, and applicable cancellation fees.

Plaintiff Donald Wortman filed a putative class action against Defendants on November 6, 2007, alleging that Defendants (as well as other airlines no longer in the suit) colluded to fix the prices of certain passenger tickets and fuel surcharges on flights between the United States and Asia, in violation of Section 1 of the Sherman Antitrust Act, 15 U.S.C. § 1. On November 23, 2009, Defendants filed motions to dismiss Plaintiffs’ complaint, in part on the ground that the filed rate doctrine barred Plaintiffs’ claims. The district court granted Defendants’ motions in part on May 9, 2011, but denied their motions in regard to their assertion of the filed rate doctrine as a defense against claims for antitrust damages.

On September 10, 2013, following over two years of discovery, Defendants moved for summary judgment, again on the basis of the filed rate doctrine. On September 23, 2014, the district court granted in part and denied in part Defendants’ respective motions for summary judgment. The district court held that while the filed rate doctrine applied to bar Plaintiffs’ antitrust damages claims based on actually-filed fares, the doctrine did not preclude Plaintiffs’ claims regarding unfiled fares, fuel surcharges, or ANA’s “discount” fares. The district court then granted Defendants’ respective motions to certify its order partially denying summary judgment for interlocutory appeal. We similarly granted Defendants’ petitions for permission to appeal. See 28 U.S.C. § 1292(b).

ANALYSIS

I. The History and Application of the Filed Rate Doctrine

The filed rate doctrine is a judicially created rule that prohibits individuals from asserting civil antitrust challenges to an entity’s agency-approved rates. The doctrine originated in Keogh v. Chicago & Northwest Railway Co., 260 U.S. 156, 43 S.Ct. 47, 67 L.Ed. 183 (1922). The plaintiffs in that case sought damages under the Sherman Act, alleging that the rates charged by common carriers exceeded those that would be charged in a competitive market. Id. at 159-160, 43 S.Ct. 47. The rates in question, however, had been filed with, and approved by, the Interstate Commerce Commission (ICC). Id. at 160, 43 S.Ct. 47. The Supreme Court held that the plaintiffs’ suit was precluded, explaining that that

[ijnjury implies violation of a legal right. The legal rights of shipper as against carrier in respect to a rate are measured by the published tariff. Unless and until suspended or set aside, this rate is made, for all purposes, the legal rate.... The rights as defined by the tariff cannot be varied or enlarged by either contract or tort of the carrier.

Id. at 163, 43 S.Ct. 47. The Supreme Court stated that the “paramount purpose” of this rule was to prevent “unjust discrimination” between consumers. Id.

The Supreme Court reaffirmed its Keogh holding six decades later, in Square D Co. v. Niagara Frontier Tariff Bureau, Inc., 476 U.S. 409, 106 S.Ct. 1922, 90 L.Ed.2d 413 (1986), once again applying the filed rate doctrine to bar shippers’ challenges to carriers’ filed rates. The Court rejected the plaintiffs’ argument that Congress’ stated intention to promote competition in the shipping industry, as set forth in the Motor Carrier Act of 1980, implied a private right to seek antitrust damages. Id. at 420, 106 S.Ct. 1922. Rather, the Court held that absent a “specific statutory provision or legislative history indicating a specific congressional intention to overturn the long-standing Keogh construction,” a private antitrust suit’s “harmony with the general legislative purpose is inadequate” to justify deviation from the rule. Id.; see also Maislin Indus., U.S., Inc. v. Primary Steel, Inc., 497 U.S. 116, 135, 110 S.Ct. 2759, 111 L.Ed.2d 94 (1990) (“Generalized congressional exhortations to ‘increase competition’ cannot provide the ICC authority to alter the well-established statutory filed rate requirements.”). The Court also noted that the filed rate doctrine is not properly characterized as antitrust “immunity,” because other sanctions or equitable relief remain available. Square D, 476 U.S. at 422, 106 S.Ct. 1922. Rather, the doctrine simply precludes treble damages based on a hypothetically lower rate. Id.

While the filed rate doctrine initially grew out of circumstances in which common carriers filed rates that a federal agency then directly approved, we have applied the doctrine in contexts beyond this paradigmatic scheme, and most frequently in the realm of energy rates. In E. & J. Gallo Winery v. EnCana Corp., 503 F.3d 1027 (9th Cir. 2007), we considered a suit by customers against a natural gas supplier. The Federal Energy Regulatory Commission (FERC) had jurisdiction over the relevant transactions. Gallo, 503 F.3d at 1031. The defendants had not filed the challenged rates with FERC. See id. Rather, FERC had adopted a market-based approach to rate setting. Id. at 1041-42. We held that “to the extent Congress has given FERC authority to set rates under the [Natural Gas Act] and FERC has exercised that authority, such rates are just and reasonable as a matter of law and cannot be collaterally challenged under federal antitrust law or state law.” Id. at 1035 (emphasis added). The question in that case whs whether FERC had actually “authorized” the rates in question, the lack of a filing requirement notwithstanding. Id. at 1041 (citing Pub. Util. of Snohomish Cty. v. Dynegy Power Mktg., 384 F.3d 756, 760 (9th Cir. 2004), for the proposition that “[t]he fundamental question ... is whether, under the market-based system setting wholesale electricity rates, FERC is doing enough regulation to justify federal preemption of state laws.”). In Gallo, we found that it had. 503 F.3d at 1042-43.

Specifically, we found that while Congress actively removed FERC’s authority “to set prices for first sales,” and thereby left “the determination of natural gas prices at the wellhead to market forces,” id. at 1037, FERC continued to regulate rates by (1) determining ex ante that “no seller of natural gas could obtain market power and that market-based rates would be just and reasonable,” (2) issuing “blanket certificates for sales” of natural gas, which only then suspended FERC’s rate-filing requirements for those sales, and (3) monitoring the “operation of the market through the complaint process,” id. at 1038 (internal quotation marks omitted); see also Public Util. of Grays Harbor v. IDA-CORP, 379 F.3d 641, 651 (9th Cir. 2004) (identifying ways in which FERC maintained regulation of market-based rates). We also found in a prior case that FERC “imposed various reporting requirements on sellers,” and that the agency had “clearly stated its belief that these procedures satisfied] the filed rate doctrine.” Id. at 1041 (quoting Grays Harbor, 379 F.3d at 651). FERC therefore had “not abdicated its responsibilities but ha[d] acted, albeit with a light hand, to authorize just and reasonable rates” such that the filed rate doctrine applied. Id. at 1042. We cautioned, however, that “a failure by FERC to exercise its statutory authority to approve rates would cast doubt on the underlying premise of the Filed Rate Doctrine.” Id. at 1040 (emphasis added).

We considered the filed rate doctrine in a wholly different context in Carlin v. DairyAmerica, Inc., 705 F.3d 856 (9th Cir. 2013). That appeal arose from a putative class action brought by dairy farmers seeking monetary and injunctive relief due to the misreporting of pricing data to the United States Department of Agriculture (USDA), which affected the rates for raw milk set under Federal Milk Marketing Orders (FMMOs) pursuant to the Agricultural Marketing Agreement Act, 7 U.S.C. § 601 et seq. Carlin, 705 F.3d at 864-66. We conceded that FMMO prices were not the paradigmatic “filed rates” contemplated in Keogh because (1) they consisted only of minimum prices, (2) they were not nationally uniform, and (3) FMMOs did not exist at all in some locations. Id. at 870. Nevertheless, we found “sufficient attributes which justify the application of the doctrine.” Id. In particular, we reiterated our holding from Gallo that “meaningful review” by an agency is not a prerequisite to the application of the filed rate doctrine. Id. at 871. Rather, “the essential question [is] whether the market rates were authorized by the [agency].” Id. (emphasis in original). In other words, we must ask “whether the [agency] was doing enough regulation to justify federal preemption of state laws.” Id. at 872 (citing Gallo, 503 F.3d at 1041). “[T]he USDA did possess the authority and did exercise it to address problems as to the agency-set minimum prices for raw milk.” Id. at 873. Thus, the filed rate doctrine applied.

Nevertheless, despite the general applicability of the filed rate doctrine, we held in Carlin that the farmers’ suit was not barred because the federal agency in question had effectively — if retroactively — rejected the FMMO prices as incorrect, and “the policy considerations behind the doctrine d[id] not justify applying the doctrine as a bar in [that] case.” Id. at 874. In particular, calculating damages “would not [ ] involve the kind of ‘hypothetical’ speculation about agency decisions that Keogh forbids.” Id. at 882.

We have also addressed a scenario in which the filed rate doctrine did not apply at all, in Ting v. AT&T, 319 F.3d 1126 (9th Cir. 2003). There, we held that the filed rate doctrine did not bar a putative class action in which customers alleged that a telecommunication provider’s new contract rates violated state contract and consumer protection laws, despite the fact that the Federal Communications Act (FCA) required telecommunication carriers to file tariffs with the FCC. Id. at 1130. We explained that the Telecommunications Act of 1996 “fundamentally altered the [FCA’s] regulatory scheme” by directing the FCC to “forbear from applying any regulation or any provision” where “enforcement of such regulation or provision [wa]s not necessary to ensure that [rates] ... are just and reasonable” and nondiscriminatory, and where enforcement was neither necessary for consumer protection nor in the public interest. Id. at 1132 (quoting 47 U.S.C. § 160(a)).

The FCC promptly acted on its authority to forbear, explicitly stating that tariffs were no longer necessary due to market competition and that the filed rate doctrine would no longer apply. Id. at 1139 n.7. This new forbearance from requiring rate filings did not leave the market without some safeguards: The FCC retained a consumer complaint process as a means for consumers to seek a remedy for anticompetitive rates, and the FCC would not defer to the market where it determined the market to be “seriously flawed or not competitive.” Id. at 1143-45.

As these cases illustrate, the focus of the filed rate doctrine has somewhat expanded beyond its original application, in which an agency’s express approval of a rate precluded civil antitrust challenges to that rate. Nevertheless, our decisions make equally clear that this expansion is not without bounds. See, e.g., Carlin, 705 F.3d at 874.

II. Regulation of the International Airline Industry

The Federal Aviation Act of 1958 (FAA), Pub. L. No. 85-726, 72 Stat. 731, established a regulatory structure for airline rates. The FAA gave the Civil Aeronautics Board — which has since been replaced by the DOT — authority to approve or disapprove international airline rates in service .to its responsibility for preventing “unfair, deceptive, predatory, or anticompetitive practices in air transportation.” 49 U.S.C. §§ 41501, 41504. The FAA required airlines to file all tariffs with the DOT, and authorized the DOT to hold hearings, either on its own initiative or upon consumer complaint, to determine the lawfulness of those rates. 49 U.S.C. §§ 41504(a) — (b), 41509(a). The DOT implemented its authority through detailed regulations. See 14 C.F.R. Part 221.

In the late 1970s, Congress passed legislation intended to increase competition and reduce governmental regulation in the airline industry. The Airline Deregulation Act of 1978 (ADA) wholly deregulated the domestic airline market, leading the DOT to cease accepting tariff filings for domestic air carriers. See 14 C.F.R. § 399.40; Tariffs for Post-1982 Domestic Travel (April 7, 1982), 47 FR 14892-01. In the international airline market, however, Congress stopped short of full deregulation. Under the International Air Transportation Competition Act of 1979 (IATCA), the DOT retained jurisdiction over international airline rates, but had increased discretion over filing requirements. 49 U.S.C. § 40109(c). IATCA correspondingly decreased DOT’s ability to grant antitrust immunity to fare agreements among carriers as part of Congress’ “determination that airline service levels and fares should be controlled by competition, not by government regulation.” Int’l Air Transport Assoc. Tariff Conf. Proceeding July 6, 2006 at *78; see also 49 U.S.C. § 41308(b). DOT continued to be responsible for providing a complaint process for consumers to challenge international air transport rates as anticompetitive. 14 C.F.R. §§ 302.501-507, 14 C.F.R. §§ 302.401-420.

In 1997, 20 years after the passage of IATCA, the DOT announced that, in keeping with “the continuing evolution of a policy where we rely on market forces rather than continual government oversight to set prices for air transportation,” rate filing no longer served a purpose in competitive foreign markets. 62 Fed. Reg. 10758, 10760. Accordingly, in 1999, DOT issued a final rule creating its three Country Categories (A, B, and C), each with different filing requirements. 64 Fed. Reg. 40654; 14 C.F.R. § 293.10. As noted, supra, the rule required airlines flying between Category C countries and the United States, or that were “nationals” of a Category C country (ie. those airlines headquartered in Category C countries), to file all tariffs with the DOT. 14 C.F.R. § 293.10(a)(l)(iii). Airlines headquartered in or flying to and from Category B countries had to file only their standard one-way economy fares with the DOT. 14 C.F.R. § 293.10(a)(l)(ii). Airlines headquartered in or flying to and from Category A countries were not subject to any filing requirements, except to the extent that they operated flights to or from Category B or C countries. 14 C.F.R. § 293.10(a)(1)®. The Country Categories corresponded roughly to the strength of bilateral agreements between the United States and a particular country. 64 Fed. Reg. at 40656. The DOT stated that it “has always had the statutory authority to take action directly against unfiled passenger fares,” and “reserve[s] the option of reinstating the tariff-filing obligation ... where consistent with the public interest.” 62 Fed. Reg. at 10763.

Airlines submit tariffs by filing them with the Airline Tariff Publishing Company (ATPCO), which acts as a private clearinghouse to distribute fares to various entities, including the Government Filing System (GFS) through which the DOT reviews filed fares. ATPCO filters submitted fares based on the DOT’s country categories, and flags certain fares to be “presented” to the DOT for review. The DOT does not consider a fare as filed until it has been so presented, and the DOT does not appear to have access to unpresented fares.

In 1999, the DOT required that “all surcharges ... be filed.” DOT Notice of Exemption from the Department’s Tarriff-Filing Requirements, Dkt. OST-97-2050-14. However, the DOT .prohibited airlines from charging separate fuel surcharges prior to 2004. In 2004, the DOT explained that the prohibition on fuel surcharges was “established at a time when the Department was regulating fares' much more actively than is the case today, and [it was] concerned that tariff surcharges could undermine [its] regulatory supervision of fare levels.” However, it stated that increasingly competitive market conditions rendered this prohibition “no longer necessary to support the limited degree of pricing supervision that continues.”

As of October 2004, the DOT directed that “carriers [we]re free to file surcharges in general rules tariffs.” The following month the DOT announced that carriers could no longer advertise surcharges as being “government-approved,” stating that it could not “effectively monitor” fuel charges filed separately from base fares, and that listing separate surcharges as approved would constitute “an unfair and deceptive trade practice.” 69 Fed. Reg. 65676, 65676-77.

III. Application of the Filed Rate Doctrine to International Airline Fares and Fees

A. Application of the Filed Rate Doctrine to Unfiled Fares

We have previously applied the filed rate doctrine to circumstances in which the relevant rates were not literally filed. See Gallo, 503 F.3d at 1042; Grays Harbor, 379 F.3d at 651-52; Wah Chang v. Duke Energy Trading, 507 F.3d 1222, 1225 (9th Cir. 2007). In so doing, we have found that even though the regulating agency did not oversee rates via a filing system, the agency engaged in sufficient regulation through other means to satisfy the purposes of the doctrine. See, e.g., Gallo, 503 F.3d at 1042. In the present instance, by contrast, we agree with the district court’s determination that there were genuine issues of material fact as to whether the DOT effectively abdicated its authority over the unfiled air fares. Accordingly, we hold that the filed rate doctrine does not preclude Plaintiffs’ antitrust claims premised on the unfiled fares.

The parties do not dispute that the DOT had the authority to regulate unfiled rates, only whether it actually did so. As in the energy rate context, the DOT maintains a consumer complaint process through which consumers may challenge a rate as unreasonable or anticompetitive. The maintenance of a consumer complaint process is not, however, dispositive. See, e.g., Ting, 319 F.3d at 1143-44.

We acknowledge that, unlike the FCC’s affirmative disavowal of telecommunications regulation, the DOT has at least paid lip-service to the notion that it continues to exercise some oversight of unfiled rates. In particular, when the DOT first set forth its three-tiered filing scheme, it stated that the new system would “not materially lessen the Department’s ability to intervene in passenger pricing matters” because

First, the review of [International Air Transport Association] passenger fare agreements will continue. Second, the Department has always had the statutory authority to take action directly against unfiled passenger fares and rules under a variety of circumstances. And third, the Department will reserve the option under the proposed rule of revoking the exemption, and thus of reinstating the tariff-filing obligation, with regard to a particular carrier or carriers, or for specific markets, where consistent with the public interest.

62 Fed. Reg. at 10763. Nevertheless, the evidence shows that the DOT’s actual actions regarding unfiled fares have been minimal at best. Appellants point only to the 2005 reassignment of Argentina to a stricter Country Category as evidence of any ongoing regulation. Additionally, there remains some question regarding whether — despite the DOT’s representation that it would maintain authority over unfiled fares — the DOT has the ability to actually access or review those fares. The DOT’s only means of considering unfiled rates appears to be through (1) assessment of the strength of bilateral pricing agreements between the United States and a given country, and (2) consumer complaints. See 14 C.F.R. §§ 302.501-507, 302.401-420.

In short, there are genuine issues of fact as to whether the DOT has effectively abdicated the exercise of its authority to regulate unfiled fares. Accordingly, the district court did not err in denying summary judgment to Defendants as to those fares based on the filed rate doctrine. See Gallo, 503 F.3d at 1040 (“[A] failure by FERC to exercise its statutory authority to approve rates would cast doubt on the underlying premise of the Filed Rate Doctrine .... ”).

B. Application of the Filed Rate Doctrine to Fuel Surcharges

As with unfiled fares, the parties do not contest that the DOT had authority to regulate fuel surcharges, but only whether it actually did so. The district court did not err by finding that genuine issues of material fact regarding the DOT’s exercise of regulatory authority over fuel surcharges precluded entry of summary judgment for Defendants.

The DOT did not permit airlines to impose fuel charges separately from base airfares prior to 2004, at which time the DOT appears to have permitted, but not required, airlines to file any such surcharges in their general rules tariffs. Admittedly, affording airlines the freedom to file surcharges, but not requiring them to do so, makes little sense — businesses are unlikely to expend time and money complying with optional regulations. Thus Defendants argue that the DOT did actually require airlines to file fuel surcharges, and that the language “permittfing]” airlines to file surcharges in their general rules tariffs indicates discretion on the part of airlines regarding the procedural manner in which they file their fuel charges, not whether they file at all. Defendants further argue that the DOT required filing of fuel surcharges pursuant to its 1999 rule notice stating that “all surcharges are to be filed.” The record reflects that some of the airlines involved in this appeal did, or at least attempted to, file fuel surcharges during the class period.

Application of the filed rate doctrine to fuel surcharges does not, however, turn on whether the DOT requires airlines to file those rates. Rather, summary judgment based on the application of the filed rate doctrine was inappropriate in light of the DOT’s express statement that it lacks the ability to “effectively monitor” fuel surcharges. 69 Fed. Reg. at 65676-77. As we stated in Gallo, “a failure by [the agency] to exercise its statutory authority to approve rates [ ] cast[s] doubt on the underlying premise of.the Filed Rate Doctrine.” 503 F.3d at 1040. In the context of fuel surcharges, the DOT may have intended to exercise some regulatory authority, insofar as it required surcharges to be filed. The DOT’s intent in this regard is unclear given its lack of participation in this lawsuit. However, the evidence on record created a genuine issue of material fact as to whether the DOT retained the practical ability to do so. Inability to regulate, just as much as willful abdication, constitutes a “failure by [an agency] to exercise its statutory authority.” Id. In accordance with the DOT’s expression of its inability to regulate fuel surcharges, we decline to apply the filed rate doctrine to preclude Plaintiffs’ claims regarding those surcharges.

C. Application of the Filed Rate Doctrine to Discount Fares

The third category of fares for which the district court considered the application of the filed rate doctrine is that of ANA’s “discount” fares — as relevant here, those fares that differ in both price and terms from ANA’s filed tariffs. We acknowledge that the filed rate doctrine prohibits suits based not only on a difference between filed and actually-applied rates, see Maislin, 497 U.S. at 127, 110 S.Ct. 2759, but also on any difference between filed and actually-applied terms, AT&T Corp. v. Central Office Tel., Inc., 524 U.S. 214, 223-27, 118 S.Ct. 1956, 141 L.Ed.2d 222 (1998). However, we have not previously considered the application of the filed rate doctrine to a situation in which both the rate and the terms deviate from those on file with the regulating agency. We face that situation now, and we conclude that the district court did not err in declining to apply the doctrine given the questions of fact regarding whether the discount fares constitute the same product as the fares actually filed.

In Central Office, the Supreme Court stated that “the policy of nondiscriminatory rates is violated when similarly situated customers pay different rates for the same services.” 524 U.S. at 223, 118 S.Ct. 1956 (emphasis added). In this case, the terms of the unfiled discount tickets differed substantially from those of the filed fares. Moreover, the filed rate doctrine is grounded in the notion that courts should not be interpreting “reasonable” pricing when an agency has already approved a given rate, and the concomitant desire to avoid discriminatory pricing between customers. Keogh, 260 U.S. at 163-64, 43 S.Ct. 47. Neither of these justifications supports application of the doctrine to ANA’s discount-fare scheme. In regard to the latter, the entire system of discount fares is premised on varied pricing between consumers — accompanied, of course, by differing terms. As to the former consideration, it is somewhat disingenuous to label the filed rates as “approved rates” for a corresponding discount fare since the service being purchased differs materially from that described in the filed tariff.

Economy class and business class fares are considered to be different products by the DOT, and are, accordingly, filed separately, despite the fact that each may apply to the same departure and arrival point. See 62 Fed. Reg. at 10760 (distinguishing between “economy” fares, which must be filed by Category B countries, and “promotional” or “premium” fares, which need not be filed by Category B countries). The district court did not err in denying summary judgment to Defendants as to these discount fares. Given the differences in both the prices and terms, a question of fact existed as to whether the DOT could effectively regulate the actual fares because they arguably constituted different products from the filed fares.

CONCLUSION

The record as it currently stands indicates that the DOT has not exercised its authority to regulate unfiled airfares, fuel surcharges, or discount fares in. a manner sufficient to justify the application of the filed rate doctrine. Should additional evidence indicate a greater degree of regulation by the DOT than is currently reflected in the record, the district court is free to reassess whether the filed rate doctrine bars any of Plaintiffs’ claims. Pursuant to 28 U.S.C. § 517, the United States may submit a statement in a case expressing its views on relevant issues in which it has an interest. See, e.g., Dept of Fair Empl. and Hous. v. L. Sch. Admis. Council Inc., 896 F.Supp.2d 849, 854 (N.D. Cal. 2012) (non-party United States entering statement of interest pursuant to 28 U.S.C. § 517); Berglund v. Boeing Co., Inc., 02-193-AS, 2006 WL 1805965, at *1 (D. Or. June 22, 2006) (same). On remand, we urge the parties to solicit the DOT’s views regarding its regulatory authority on the various rates here at issue.

We AFFIRM the . district court’s partial denial of Defendants’ motions for summary judgment, and we REMAND this matter for further proceedings consistent with this opinion.

WALLACE, Circuit Judge,

concurring in part and dissenting in part:

I concur in the bulk of the majority’s well-reasoned opinion. I dissent, however, from the majority’s conclusion that genuine issues of material fact remain as to whether the- DOT effectively abdicated its authority over fuel surcharges that Defendants actually filed with the DOT.

In Section III, Subsection B, the majority discusses the second type of rate at issue in this appeal: fuel surcharges. In 1999, when the DOT implemented the category A, B, and C rate-filing system, the DOT explicitly stated that “all surcharges are to be filed.” At the same time, however, the DOT did not allow fuel surcharges to be filed separately from airfares. Instead, the DOT insisted that carriers should recoup fuel expenses through increases in their base fares. In 2004, the DOT changed this policy, and allowed, but did not require, airlines to file separate fuel surcharges.

The parties disagree vigorously as to what the record reflects regarding the filing of fuel surcharges. Defendants assert that they “are unambiguously required to' file all surcharges, including fuel surcharges, with DOT.... While the district court concluded that DOT did not require fuel surcharges to be filed, that conclusion was simply incorrect.” Plaintiffs, on the other hand, contend that Defendants “were never required to file them as a matter of law.” Notwithstanding the factual disagreement over whether the DOT required the filing of surcharges after 2004, the record is also unclear as to whether Defendants actually filed them in a consistent manner.

In sorting through the record on the filing of fuel surcharges, the majority concludes that “summary judgment based on the application of the filed rate doctrine was inappropriate in light of the DOT’s express statement that it lacks the ability to ‘effectively monitor’ fuel surcharges.” For the fuel surcharges that were not actually filed, I agree with the majority’s analysis, and assert that these unfiled surcharges should be treated the same as the unfiled airfares. Defendants have not pointed to any evidence indicating the DOT’s regulation of unfiled fuel surcharges. Instead, Defendants merely assert that the DOT required all surcharges to be filed (which, as described above, is contested). Accordingly, I agree with the majority’s holding that the filed rate doctrine does not bar, as a matter of law, antitrust challenges to unfiled fuel surcharges.

I conclude, however, that the majority is incorrect as to any fuel surcharges that were actually filed. In Square D Co. v. Niagara Frontier Tariff Bureau, Inc., the Supreme Court affirmed the filed rate doctrine’s viability and held that the filed rate doctrine was not limited to instances in which “rates had been investigated and approved” but rather extended to instances “whenever tariffs have been filed.” 476 U.S. 409, 417 n.19, 106 S.Ct. 1922, 90 L.Ed.2d 413 (1986), quoting Square D Co. v. Niagara Frontier Tariff Bureau, Inc., 760 F.2d 1347, 1351 (2d Cir. 1985).

The facts and the Supreme Court’s holding in Square D are not the same as in our case. Moreover, Square D merely made the assertion in a footnote that the filed rate doctrine bars claims “whenever tariffs have been filed.” Nevertheless, this footnote from Square D is the closest the Supreme Court has come to answering the question of whether challenges to rates that were actually filed are permissible under the filed rate doctrine. The Supreme Court answered no to this critical question. Thus, I assert that the fuel surcharges that have actually been filed in our case fall under the umbrella of Square D’s holding.

The majority’s conclusion on this issue seems to rely solely on the DOT’s statement that it lacked the ability to “effectively monitor” fuel surcharges. The DOT’s statement, however, must be read in its full context. In 2004, the DOT stated:

[T]he desire of carriers to pass on the higher cost of certain expenses discretely, such as insurance and fuel, has led to such expenses being filed separately from the “base” fare in tariffs, a situation that the Department cannot effectively monitor.... [T]he Enforcement Office will no longer allow the separate listing of “government-approved” surcharges in fare advertising. We will consider the separate listing of such charges in fare advertisements an unfair and deceptive trade practice....

69 Fed. Reg. at 65676-77. From this single statement, regarding “the separate listing of ‘government-approved’ surcharges in fare advertising,” the majority formulates a genuine issue of material fact as to whether the filed rate doctrine is inapplicable to all fuel surcharges, whether or not they were filed. I assert that the majority reads far too much into the DOT’s statement relating to advertising.

Accordingly, I would reverse the district court to the extent it held that Plaintiffs could challenge the literally-filed fuel surcharges. The existence of the rates that were actually filed, combined with the existence of the DOT’s consumer complaint process, negates any issue of material fact as to whether the DOT effectively abdicated its authority to regulate actually-filed fuel surcharges.

When we create and expand judge-made doctrines, such as the filed rate doctrine, we must do so with an eye towards the lower courts’ application of those doctrines. In Gallo and Carlin, we employed the “effective abdication” exception to the filed rate doctrine in situations when rates had not actually been filed. This rule erected a clear barrier between treatment of rates that had actually been filed versus those that had not. Here, the majority muddles that barrier, and expands the exception by adopting the rule that courts must determine when an agency has “effectively abdicated” its authority, notwithstanding the actual filing of rates. I fear this expansion has no limiting principle, and could lead to the crumbling of the filed rate doctrine, in contravention of the Supreme Court’s guidance. Adhering to a rule — that the literal filing of rates means the filed rate doctrine applies — is more' workable than the nebulous standard the majority has constructed here. Thus, I respectfully dissent from Section III, Subsection B of the majority opinion.

      . "Circle trips” begin and end at the same point, but involve multiple stopovers.

      . "Double open jaw” trips are those in which the origin and destination of the first flight are different from the origin and destination of the second, such that instead of traveling outbound from A to B and back from B to A, the customer travels outbound from A to B, but, then, on the second trip, from C to D.

      . Although the order is arguably susceptible to different readings, Plaintiffs acknowledged at oral argument that the district court's order did not implicitly or explicitly grant summary judgment in Plaintiffs' favor as to the unfiled fares, fuel surcharges, and discount fares. We treat the order as merely denying summary judgment in Defendants’ favor as to these rates.

      . Some airlines privately filed fuel surcharges, but entered them into the database incorrectly such that they were not flagged to be presented to the DOT and thus were not considered “filed” within the meaning of the DOT’s regulations.

      . Notwithstanding Gallo’s instruction that actual filing does not end the filed rate doctrine inquiry, Judge Wallace cites Gallo and Carlin as establishing a "clear barrier” between filed and unfiled rates, such that an agency’s failure to regulate is only relevant where the rate in question was not filed. We do not find this reading of Gallo and Carlin persuasive. On the contrary, while those cases may have dealt with rates not actually filed, their reasoning expressly invokes “the principles underlying [the] doctrine” to find that its application does not turn on "the act of literal rate filing.” Gallo, 503 F.3d at 1040. Our opinion does not effect the unbounded expansion that Judge Wallace cautions against. Rather, it consistently applies the logic expressly set forth in our prior cases. To hold, as Judge Wallace advocates, that merely filing a rate triggers application of the doctrine in every circumstance, would permit carriers to avoid civil antitrust damages by filing rates even where the relevant agency has expressly stated that it cannot or will not engage in regulation. Such application of the doctrine completely untethers it from both its underlying justification and the reasoning of our prior decisions. We decline to adopt such a rule.

      . The majority, in footnote 5, asserts that Gallo stands for the proposition that the filed rate doctrine's application “does not turn on ‘the act of literal rate filing' ” (Majority Opinion at n.5, quoting Gallo, 503 F.3d at 1040). The majority’s statement is misleading. The full sentence from Gallo, from which the majority selectively clips, is: "Moreover, although the Supreme Court initially applied the Filed Rate Doctrine to actual filed rates, courts have held that the principles underlying this doctrine preclude challenges to a wide range of FERC actions, not just the act of literal rate filing.” Id. In essence, what Gallo conveys here is that while the filed rate doctrine has commonly applied only to actually-filed rates, its reach can expand even further, to scenarios in which rates have not been filed. In no way does Gallo suggest that the filed rate doctrine does not apply to actually-filed rates. Indeed, application to filed rates makes sense and is not "unbounded,” because it allows the DOT to rely on complaints about a filed rate to exercise its supervision.


author: BEA, Circuit Judge:

text:
    MINTO, Petitioner, v. Jefferson B. SESSIONS III, Attorney General, Respondent.
    No. 12-74027
    United States Court of Appeals, Ninth Circuit.
    Argued and Submitted February 23, 2017, Honolulu, Hawaii
    Filed April 17, 2017

      Joseph E. Horey (argued), O’Connor Berman Dotts & Banes, Saipan, Commonwealth of the Northern Mariana Islands, for Petitioner.

      Jessica E. Burns (argued), Senior Litigation Counsel; Ashley Martin, Trial Attorney; Mary Jane Candaux, Assistant Director; Office of Immigration Litigation, Civil Division, United States Department of Justice, Washington, D.C.; for Respondent.
    Before: ALEX KOZINSKI, MICHAEL DALY HAWKINS, and CARLOS T. BEA, Circuit Judges.
   OPINION

BEA, Circuit Judge:

In 2009, the immigration laws of the United States took effect in the Commonwealth of the Northern Mariana Islands (“CNMI”), a group of islands in the Pacific Ocean. An immigration judge (“IJ”) then ordered Minto, who was in the CNMI, removed on the basis of 8 U.S.C. § 1182(a) (7) (A) (i) (I), which makes an immigrant inadmissible if he lacks a valid entry document “at the time of application for admission.” The Board of Immigration Appeals (“BIA”) dismissed Minto’s subsequent appeal. He now petitions this Court for review, arguing that 8 U.S.C. § 1182(a)(7)(A)(i)(I) does not apply to him because he never applied for admission to the United States at a definite time. We deny Minto’s petition for review because we conclude that he is an immigrant who lacked a valid entry document and is deemed by law to have made a continuing application for admission by being present in the CNMI, an application that was considered and denied during his removal proceedings.

1. FACTUAL AND PROCEDURAL HISTORY

A. The Commonwealth of the Northern Mariana Islands

Previously Spanish possessions, the Northern Mariana Islands first came under United States control after World War II. See U.S. ex rel. Richards v. De Leon Guerrero, 4 F.3d 749, 751 (9th Cir. 1993). In 1976, Congress, the Northern Mariana Islands District Legislature, and the people of the Northern Mariana Islands approved a Covenant to Establish a Commonwealth of the Northern Mariana Islands in Political Union with the United States of America (the “Covenant”). See Pub. L. No. 94-241, 90 Stat. 263, 265-66 (1976) (joint resolution of Congress approving the Covenant and setting out its text). Under the Covenant, the new Commonwealth of the Northern Mariana Islands delegated “complete responsibility” for some matters — such as foreign affairs and defense — to the United States, but retained “the right of local self-government ... with respect to internal affairs.” Covenant art. 1, §§ 103-104.

Initially, immigration was reserved to the CNMI. See Covenant § 503(a) (“The following laws of the United States ... will not apply to the Northern Mariana Islands ... : (a) [ ] the immigration and naturalization laws of the United States.”). This changed in 2008 when Congress passed the Consolidated Natural Resources Act (“CNRA”), codified in relevant part at 48 U.S.C. §§ 1806-1808. The CNRA provided that the “immigration laws” of the United States “shall apply” to the CNMI no later than December 1, 2009. See id. § 1806(a)(1) (setting June 1, 2009 as the “transition program effective date” — that is, the date that the U.S. immigration laws would take effect in the CNMI); id. § 1806(a)(3) (authorizing the Secretary of Homeland Security to “delay[ ] [the transition program effective date] for a period not to exceed more than [sic] 180 days after such date”). U.S. immigration laws became applicable to the CNMI on November 28, 2009. See 8 C.F.R. § 1001.1(bb). Also, the CNRA “made the CNMI part of the United States within the meaning of the Immigration and Nationality Act.” Eche v. Holder, 694 F.3d 1026, 1027 (9th Cir. 2012) (citing CNRA § 702, Pub. L. No. 110-229, 122 Stat. 754, 866 (2008); 8 U.S.C. § 1101(a)(36), (a)(38)). Therefore, since November 28, 2009, the CNMI has been part of the United States for purposes of the immigration laws.

B. Minto’s History in the CNMI

Minto is a native of Bangladesh. He arrived in the CNMI by plane in 1997 and was admitted with a nonresident worker entry permit. In 2003, he married Maria Aurelio Ray (“Ray”), a citizen of the Federated States of Micronesia and a resident of the CNMI. After his marriage, Minto received an entry permit under section 706D of the Northern Mariana Islands Immigration Regulations as an immediate relative of a resident of the CNMI. See 7 N. Mar. I. Reg. 3786-87 (July 22, 1985).

In 2008, the CNMI Director of Immigration revoked Minto’s 706D entry permit because a CNMI court had convicted Ray of two counts of conspiracy to commit marriage fraud. Minto was also convicted of conspiracy to commit marriage fraud and solicitation a few months after his wife’s convictions. The convictions did not involve Minto’s marriage to Ray, the legitimacy of which has not been questioned. According to the CNMI Director of Immigration, Ray was “deportable” because of this felony offense, and Ray could therefore no longer serve as the sponsoring spouse for Minto’s 706D entry permit. Minto appealed the decision to revoke his entry permit to the CNMI Attorney General on the basis that Ray’s conviction was not final because Ray had filed a motion for a new trial, which was awaiting adjudication.

C. Procedural History

On May 12, 2010, the Department of Homeland Security (“DHS”) served Minto with a Notice to Appear (“NTA”). Allegedly, Minto was “an immigrant not in possession of a valid unexpired immigration visa ... or other valid entry document.” The NTA charged Minto with being removable from the United States based on §§ 212(a)(6)(A)® and 212(a)(7)(A)(i)(I) of the Immigration and Nationality Act (“INA”), codified at 8 U.S.C. §§ 1182(a)(6)(A)(i), 1182(a)(7)(A)(i)(I). Section 1182(a)(6) states that an alien is inadmissible if that alien is “present in the United States without being admitted or paroled.” Section 1182(a)(7) states that an immigrant is inadmissible if the immigrant lacks a valid entry document “at the time of application for admission.”

The IJ sustained the charge under § 1182(a)(7). The IJ ordered Minto removed.

Minto appealed the removal order to the BIA. Before the BIA, Minto moved for a remand to apply for parole under a new program created by the United States Citizenship and Immigration Services (“US-CIS”) called Parole for Immediate Relatives of U.S. Citizens and Certain Stateless Individuals (“the USCIS program”). The BIA dismissed the petition for review, thereby affirming the removal order, and denied the motion for remand. The BIA found that Minto was not entitled to parole under the USCIS program because Minto did not provide evidence of lawful presence in the CNMI as of November 27, 2011. Specifically, the BIA found that he had failed to provide documentation that Ray had filed a motion for a new trial, that Ray had appealed the conviction, or that Min-to’s appeal of the revocation of his entry permit was successful.

Minto then filed a timely petition for review with this Court, arguing that he is not removable under § 1182(a)(7).

II. JURISDICTION AND STANDARD OF REVIEW

This Court reviews the BIA’s legal determinations de novo. De Martinez v. Ashcroft, 374 F.3d 759, 761 (9th Cir. 2004). The BIA’s factual findings are reviewed for “substantial evidence,” and this Court will not reverse the BIA’s factual findings “unless the evidence compels a contrary result.” Gallegos-Vasquez v. Holder, 636 F.3d 1181, 1184 (9th Cir. 2011). Since the BIA decision agreed with the IJ’s reasoning in dismissing Minto’s petition for review, this Court reviews both decisions. See Kumar v. Holder, 728 F.3d 993, 998 (9th Cir. 2013).

III. ANALYSIS

A. Minto is removable under § 1182(a)(7)

The CNRA made the CNMI subject to the immigration laws of the United States a year before removal proceedings were commenced against Minto. See supra p. 621-22. The CNRA states that all of the INA’s grounds of removability apply to individuals within the CNMI with one exception. See 48 U.S.C. § 1806(e)(4) (“Except as specifically provided in paragraph (1)(A) of this subsection, nothing in this subsection shall prohibit or limit the removal of any alien who is removable under the Immigration and Nationality Act.”). The only exception states that “no alien who is lawfully present in the [CNMI] ” as of November 28, 2009, “shall be removed ... on the grounds that such alien’s presence in the [CNMI] is a violation of ... 8 U.S.C. § 1182(a)(6)(A)” until “the completion of the period of the alien’s admission under immigration laws of the Commonwealth; or ... 2 years after the transition program effective date.” See 48 U.S.C. § 1806(e)(1)(A).

However, section 212(a)(7) of the INA, codified at 8 U.S.C. § 1182(a)(7), provides a different ground for removability than does § 1182(a)(6)(A): failure to possess a valid entry document at the time of application for admission. Minto was served with the NTA on May 12, 2010, after the CNMI became subject to United States immigration laws. Therefore, § 1182(a)(7) is potentially applicable to Minto.

Section 1182(a)(7) states in relevant part:

Except as otherwise specifically provided in this chapter, any immigrant at the time of - application for admission ... who is not in possession of a valid unexpired immigrant visa, reentry permit, border crossing identification card, or other valid entry document required by this chapter ... is inadmissible.

8 U.S.C. § 1182(a)(7)(A)(i)(I). Section 1182(a)(7) has three elements: the individual in question (1) is an immigrant (2) who “at the time of application for admission” (3) lacks a valid entry document.

The government has established the first element. Minto is an “immigrant” because this term applies to “every alien” except certain aliens, including ambassadors and temporary workers, who are specifically designated “nonimmigrant aliens.” See 8 U.S.C. § 1101(a)(15). Before this Court, Minto does not challenge that he is an immigrant.

The government has also established the third element. Minto has never had “a visa, reentry permit, border crossing identification card, or other valid entry document” to the United States. Minto agrees.

The parties dispute the second element, whether Minto is an “applicant for admission.” We conclude he is because an immigrant in Minto’s position is deemed by law to be making a continuing application for admission by his mere presence in the CNMI. 8 U.S.C. § 1225(a)(1) states that “[a]n alien present in the United States who has not been admitted or who arrives in the United States ... shall be deemed for purposes of this chapter an applicant for admission.” As noted above, the immigration laws of the United States were made applicable to the CNMI on November 28, 2009. Therefore, Minto, who was present in the CNMI without admission or parole on November 28, 2009, is “deemed” to be “an applicant for admission.”

Nor did Minto’s status as an applicant for admission terminate at any point.

There is a “well-established immigration practice that treats an application for admission as a continuing one.” Matter of Valenzuela-Felix, 26 I&N Dec. 53, 59 (BIA 2012). Accordingly, the Second, Fifth and Seventh Circuits have held that the relevant facts and law for determining a petitioner’s admissibility are those in existence “at the time the application is finally considered” by the agency. Ali v. Reno, 22 F.3d 442, 448 n.3 (2d Cir. 1994) (internal quotation marks and citation omitted); see also Munoz v. Holder, 755 F.3d 366, 372 (5th Cir. 2014) (same); Palmer v. I.N.S., 4 F.3d 482, 485 n.11 (7th Cir. 1993) (same). We agree and hold that Minto’s application for admission that began on the transition program effective date continued until it was considered by the IJ.

8 U.S.C. § 1229a, which governs removal proceedings, including Minto’s, assumes that an alien in removal proceedings will present a continuing application for admission. 8 U.S.C. § 1229a(a)(3) states, “[u]n-less otherwise specified in this chapter, a proceeding under this section shall be the sole and exclusive procedure for determining whether an alien may be admitted to the United States or, if the alien has been so admitted, removed from the United States.” During a § 1229a removal proceeding, “if the alien is an applicant for admission,” the alien has the burden of establishing that he is “clearly and beyond doubt entitled to be admitted and is not inadmissible under section 1182 of this title[.]” 8 U.S.C. § 1229a(c)(2)(A). Alternatively, the alien must show by “clear and convincing evidence” that he is “lawfully present in the United States pursuant to a prior admission.” 8 U.S.C. § 1229a(c)(2)(B). Therefore, § 1229a(c)(2) contemplates that the alien in a removal proceeding is necessarily either an “applicant for admission” whose continuing application will be considered during that proceeding or an alien who alleges he is already lawfully present in the United States because of a prior admission.

For the foregoing reasons, we hold that an immigrant may be found inadmissible under § 1182(a)(7) when the immigrant is found to lack a valid entry document during a removal proceeding.

B. Interpreting § 1182(a)(7) to apply to Minto is not contrary to Congress’s intent in enacting the CNRA

Minto argues that this interpretation of § 1182(a)(7), as applied to aliens in the CNMI, would undermine Congress’s intent in passing the CNRA. It is true that, as noted above, the CNRA did create a transition period in which aliens lawfully present in the CNMI could not be removed on the basis of § 1182(a)(6). 48 U.S.C. § 1806(e)(1)(A).

But holding that Minto is removable under § 1182(a)(7) would not contravene Congress’s intent to offer limited protection from removal as expressed in 48 U.S.C. § 1806(e)(1)(A). First, the CNRA expressly states that, except for the temporary exemption from removability under § 1182(a)(6), “nothing in this subsection shall prohibit or limit the removal of any alien who is removable under the Immigration and Nationality Act.” 48 U.S.C. § 1806(e)(4). Indeed, this Court has previously recognized that “[t]he CNRA’s plain text commands that the exceptions to the principle that the immigration laws of the United States apply to the CNMI be restricted to those explicitly set forth in the statute[.]” United States v. Yong Jun Li, 643 F.3d 1183, 1185 (9th Cir. 2011).

Also, the CNRA itself provided a mechanism for aliens lawfully present in the CNMI to avoid removal under § 1182(a)(7). The CNRA directed the Secretary of Homeland Security to establish a program to provide nonimmigrant worker visas for aliens present in the CNMI. 48 U.S.C. § 1806(d)(2). This program was implemented by regulation. 8 C.F.R. § 214.2(w). Furthermore, as noted above, USCIS implemented a program that allowed certain CNMI aliens to receive parole under 8 U.S.C. § 1182(d)(5) on a case-by-case basis. USCIS determined that Minto himself was ineligible for this program because he could not demonstrate lawful presence and because of his conviction for conspiracy and solicitation to commit marriage fraud.

IV. CONCLUSION

We deny Minto’s petition for review. Minto is an immigrant who lacked a valid entry document when his continuing application for admission was considered by the IJ during his removal proceeding. Therefore, the IJ and the BIA correctly concluded that Minto was inadmissible under 8 U.S.C. § 1182(a)(7).

DENIED.

      . Located just north of Guam, the CNMI is a three-hundred mile archipelago consisting of 14 islands, with a total land area of 183.5 square miles. The principal inhabited islands are Saipan, Rota and Tinian. The northern, largely uninhabited islands are Farallón de Medinilla, Anatahan, Sariguan, Gudgeon, Alamagan, Pagan, Agrihan, Asuncion, Maug Islands, and Farallón de Pajaro. See Commonwealth of the Northern Mariana Islands, https://www.doi.gov/oia/islands/cnmi (last visited March 8, 2017).

      . The petitioner in this case has a single name.

      . The CNRA incorporates by reference 8 U.S.C. § 1101(a)(17), which defines the term "immigration laws" as "all laws, conventions, and treaties of the United States relating to the immigration, exclusion, deportation, expulsion, or removal of aliens.” See 48 U.S.C. § 1806(a).

      . The Federated States of Micronesia ("FSM”) is an independent country, but it has signed a Compact of Free Association with the United States. Citizens of the FSM are not United States citizens.

      . Minto unsuccessfully argued that he was not an immigrant to the IJ and the BIA, but does not repeat that argument before us.

      . This section allows the Attorney General to temporarily parole into the United States an alien applying for admission “on a case-by-case basis for urgent humanitarian reasons or significant public benefit[.]” 8 U.S.C. § 1182(d)(5)(A).

      . The parties dispute whether Minto was lawfully present in the CNMI on November 28, 2009. According to Minto, his administrative appeal from his entry permit revocation made his continuing presence in the CNMI lawful. According to the government, Minto’s appeal became moot on November 28, 2009, when CNMI officials lost the authority to enforce their own immigration laws. Also, the government states that Minto did not introduce evidence demonstrating that his appeal was still pending as of November 28, 2009, or was successful. We need not decide this issue since lawful presence in the CNMI under CNMI law would not save Minto from being’ removable under 8 U.S.C. § 1182(a)(7) because he lacked a valid entry permit. Minto does not argue that his 706D entry permit, the revocation of which he allegedly appealed, was a "valid entry document” for purposes of § 1182(a)(7).