UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
SYNGENTA CROP PROTECTION, INC.,
Plaintiff,
v. Civil Action No. 08-1627 (JDB)
DREXEL CHEMICAL COMPANY, et al.,
Defendants.
MEMORANDUM OPINION
Plaintiff Syngenta Crop Protection, Inc. ("Syngenta") and defendant Drexel Chemical
Company ("Drexel") are currently engaged in a binding arbitration proceeding initiated under the
data-sharing provisions of the Federal Insecticide, Fungicide and Rodenticide Act ("FIFRA"), 7
U.S.C. §§ 136 et seq. Syngenta seeks a declaratory judgment that the arbitration panel cannot
consider a 1993 Agreement and Stipulation in evaluating Syngenta's data compensation award.
Now before the Court is Drexel's motion to dismiss for lack of subject matter jurisdiction and
failure to state a claim under Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). For the
reasons discussed below, Drexel's motion to dismiss will be granted.
BACKGROUND
Enacted in 1972, FIFRA governs the registration of pesticides and sets forth the
requirements for the submission of health, safety, and environmental data. Under FIFRA,
pesticide registrants must demonstrate that their pesticide will "perform its intended function
without unreasonable adverse effects on the environment." 7 U.S.C. § 136a(a). To satisfy this
requirement, a registrant must either submit its own data or cite to data that "appear in the public
literature or that previously had been submitted to the Administrator [of the Environmental
Protection Agency]." § 136a(c)(1)(F). Applicants citing to another company's data must offer to
compensate the original data submitter. § 136a(c)(1)(F)(iii). If no compensation agreement can
be reached, either party may initiate a binding arbitration, governed by the procedures set forth
by the Federal Mediation Conciliation Service ("FMCS"). Id.
The FIFRA arbitration scheme was created in response to the "'logjam of litigation that
resulted from controversies over data compensation.'" Thomas v. Union Carbide Agric. Prods.
Co., 473 U.S. 568, 573 (1985) (quoting S. Rep. No. 95-334, at 3 (1977)). Congress found that
the EPA "'lacked the expertise necessary to establish the proper amount of compensation,'" and
hence compensation "'should be determined to the fullest extent practicable, within the private
sector.'" Id. (quoting 123 Cong. Rec. 25709-10 (1977) (statement of Sen. Leahy)). For
arbitration proceedings under FIFRA, the FMCS incorporated the rules of the American
Arbitration Association ("AAA"), a private arbitration service organization. See 29 C.F.R. §
1440.1; 29 C.F.R. Pt. 1440, App. FIFRA provides that "the findings and determination of the
arbitrator shall be final and conclusive, and no official or court of the United States shall have
power or jurisdiction to review any such findings and determination, except for fraud,
misrepresentation, or other misconduct by one of the parties to the arbitration or the arbitrator."
7 U.S.C. § 136a(c)(1)(F)(iii).
In 2004, the EPA required Drexel to offer to compensate Syngenta for using its studies
on the safety of the herbicide atrazine if Drexel wished to renew its registration for atrazine.
Syngenta Opp'n at 3. The parties could not agree on a compensation amount and Syngenta
subsequently initiated arbitration under FIFRA. Am. Compl. ¶¶ 16-17. Eleven months after
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Syngenta filed the demand for arbitration, Drexel introduced a 1993 Agreement and Stipulation
pertaining to the atrazine studies, which was entered into by Ciba-Geigy Corporation (Syngenta's
predecessor) and Drexel as part of a prior FIFRA arbitration. Id. ¶¶ 18-19. Syngenta moved to
exclude "all claims, evidence and argument" related to the 1993 Agreement and Stipulation. Id.
¶ 20. The arbitration panel denied Syngenta's motion in an "Interim Order" on September 5,
2008, stating that "it does have jurisdiction to consider at the hearing of this matter any defense
raised by Drexel based on the 1993 settlement agreement." Id. ¶ 23, Ex. 1, Ex. A.
On September 23, 2008, Syngenta filed a complaint in this Court, seeking a declaratory
judgment that Article III of the Constitution bars the arbitration panel from considering the 1993
Agreement and Stipulation. Syngenta then filed an amended complaint asserting subject matter
jurisdiction under: (1) 28 U.S.C.§ 1331, because this action arises under the Constitution and
laws of the United States, and pursuant to Sections 3(c)(1)(F)(iii) and 16(c) of FIFRA, 7 U.S.C.
§§ 136a(c)(1)(F)(iii), 136n(c); (2) 28 U.S.C. § 1332(a) based on diversity of citizenship; (3) the
Administrative Procedure Act ("APA"), 5 U.S.C. §§ 701-06; (4) the Mandamus Statute, 28
U.S.C. § 136; (5) the All Writs Act, 28 U.S.C. § 1651; and (6) the Declaratory Judgment Act, 28
U.S.C. § 2201-02. Am. Compl. ¶¶ 2-4.
Now before the Court is Drexel's motion to dismiss for lack of subject matter jurisdiction
under Federal Rule of Civil Procedure 12(b)(1) and failure to state a claim under Rule 12(b)(6).
Drexel argues that Syngenta cannot establish the Court's subject matter jurisdiction for this
interlocutory appeal of the FIFRA arbitration panel's interim decision, and that, even if it can, the
Court should decline to exercise its discretion to grant declaratory judgment. See Drexel Mem.
at 1. Syngenta responds that review of the arbitration panel's decision and entry of a declaratory
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judgment are appropriate at this time. See Syngenta Opp'n at 1.
LEGAL STANDARD
"[I]n passing on a motion to dismiss, whether on the ground of lack of jurisdiction over
the subject matter or for failure to state a cause of action, the allegations of the complaint should
be construed favorably to the pleader." Scheuer v. Rhodes, 416 U.S. 232, 236 (1974); see
Leatherman v. Tarrant Cty. Narcotics and Coordination Unit, 507 U.S. 163, 164 (1993); Phillips
v. Bureau of Prisons, 591 F.2d 966, 968 (D.C. Cir. 1979). Therefore, the factual allegations must
be presumed true, and plaintiff must be given every favorable inference that may be drawn from
the allegations of fact. Scheuer, 416 U.S. at 236; Sparrow v. United Air Lines, Inc., 216 F.3d
1111, 1113 (D.C. Cir. 2000). However, the Court need not accept as true "a legal conclusion
couched as a factual allegation," nor inferences that are unsupported by the facts set out in the
complaint. Trudeau v. Federal Trade Comm'n, 456 F.3d 178, 193 (D.C. Cir. 2006) (quoting
Papasan v. Allain, 478 U.S. 265, 286 (1986)).
Under Rule 12(b)(1), the party seeking to invoke the jurisdiction of a federal court --
plaintiff here -- bears the burden of establishing that the court has jurisdiction. See US Ecology,
Inc. v. U.S. Dep't of Interior, 231 F.3d 20, 24 (D.C. Cir. 2000) (citing Steel Co. v. Citizens for a
Better Env't, 523 U.S. 83, 103-04 (1998)); see also Orlov v. Howard, 523 F. Supp. 2d 30, 32
(D.D.C. 2007). Although a court must accept as true all the factual allegations contained in the
complaint when reviewing a motion to dismiss pursuant to Rule 12(b)(1), Leatherman, 507 U.S.
at 164, "'plaintiff[s'] factual allegations in the complaint . . . will bear closer scrutiny in resolving
a 12(b)(1) motion' than in resolving a 12(b)(6) motion for failure to state a claim." Grand Lodge,
185 F. Supp. 2d at 13-14 (quoting 5A Charles Alan Wright & Arthur R. Miller, Federal Practice
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and Procedure § 1350 (2d ed. 1990)). At the stage of litigation when dismissal is sought, a
plaintiff's complaint must be construed liberally, and the plaintiff should receive the benefit of all
favorable inferences that can be drawn from the alleged facts. See EEOC v. St. Francis Xavier
Parochial Sch., 117 F.3d 621, 624 (D.C. Cir. 1997). Additionally, a court may consider material
other than the allegations of the complaint in determining whether it has jurisdiction to hear the
case, as long as it still accepts the factual allegations in the complaint as true. See Jerome
Stevens Pharmaceuticals, Inc. v. FDA, 402 F.3d 1249, 1253-54 (D.C. Cir. 2005); St. Francis
Xavier Parochial Sch., 117 F.3d at 624-25 n.3.
DISCUSSION
I. Federal Question and Diversity Jurisdiction
In determining subject matter jurisdiction, the Court is guided not by the general
jurisdictional statutes, but by the specific "statutory limitation on judicial review set forth in
FIFRA." SRM Chem. Ltd., Co., v. Fed. Mediation & Conciliation Serv., 355 F. Supp. 2d 373,
376 (D.D.C. 2005) (citing 7 U.S.C. § 136a(c)(1)(F)(iii)); Nagel v. Thomas, 666 F. Supp. 1002,
1010 (W.D. Mich. 1987) ("[W]here a regulatory statute provides a comprehensive scheme for
judicial review, those provisions are exclusive and preclude actions under general jurisdictional
provisions. . . . FIFRA, as we have seen, is just such a statute."); see also Union Carbide, 473
U.S. at 591 ("[T]he FIFRA arbitration scheme incorporates its own system of internal sanctions
and relies only tangentially, if at all, on the Judicial Branch for enforcement."). Section 16(c) of
FIFRA grants jurisdiction to the federal district courts "specifically to enforce, and to prevent
and restrain violations of [FIFRA]." 7 U.S.C. § 136n(c). The FIFRA arbitration scheme allows
judicial review of "the findings and determination of the arbitrator" only in the instance of
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"fraud, misrepresentation, or other misconduct by one of the parties to the arbitration or the
arbitrator." § 136a(c)(1)(F)(iii). "This provision protects against arbitrators who abuse or exceed
their powers or willfully misconstrue their mandate under the governing law." Union Carbide,
473 U.S. at 592. Additionally, "review of constitutional error is preserved." Id. Syngenta
claims that by deciding to consider the 1993 Agreement and Stipulation between it and Drexel,
the arbitration panel violated its statutory mandate under FIFRA by agreeing to adjudicate a
private contract claim. Syngenta Opp'n at 9. Drexel responds that the arbitration panel's interim
order was evidentiary in nature, thus barring any claim of misconduct by the arbitrator or a claim
of an unconstitutional exercise of power. Drexel Mem. at 8.
Under FIFRA's specific judicial review provisions, the initial question is whether the
arbitration panel abused its power in electing to consider the 1993 Agreement and Stipulation.
The authority of an arbitrator to consider evidence in a FIFRA data compensation dispute is
broad. The FIFRA arbitration rules state that "[t]he arbitrator shall admit all evidence which is
relevant, competent, material, not privileged, and not unduly repetitious. The weight to be given
evidence shall be determined by its reliability and probative value." 29 C.F.R. Pt. 1440, App.
Sec. 25(a). In determining compensation, "the arbitrators are free to consider any factors they
deem relevant." PPG Industries Inc. v. Stauffer Chemical Co., 637 F. Supp. 85, 87 (D.D.C.
1986). FIFRA's legislative history supports a broad grant of authority to the arbitrator in
determining compensation: "Legislators and the [EPA] agreed that '[d]etermining the amount
and terms of such compensation are matters that do not require active government involvement
[and] compensation payable should be determined to the fullest extent practicable, within the
private sector.'" Union Carbide, 473 U.S. at 573 (quoting 123 Cong. Rec. 25710). Given this
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broad discretion granted to the arbitration panel, then, the arbitrators plainly did not "abuse or
exceed their powers or willfully misconstrue their mandate" under FIFRA in deciding to
consider the 1993 Agreement and Stipulation. See id. at 592.
Syngenta contends that this interpretation of the arbitration panel's power violates Article
III of the Constitution. Syngenta points to Northern Pipeline Construction Co. v. Marathon Pipe
Line Co., 458 U.S. 50 (1982), a case holding that a broad grant of jurisdiction by Congress to
bankruptcy judges violated Article III. The Supreme Court held that Congress could not require
"the stuff of the traditional actions at common law tried by the courts of Westminster in 1789" to
be considered by non-Article III judges. Northern Pipeline, 458 U.S. at 90. But in Union
Carbide, which upheld the constitutionality of the FIFRA arbitration mechanism, the Supreme
Court narrowly construed Northern Pipeline as "establish[ing] only that Congress may not vest
in a non-Article III court the power to adjudicate, render final judgment, and issue binding orders
in a traditional contract action arising under state law, without consent of the litigants, and
subject only to ordinary appellate review." Union Carbide, 473 U.S. at 584.
So construed, Northern Pipeline does not bar the arbitration panel's consideration of the
1993 Agreement and Stipulation. Interpretation of this document is not "the stuff of the
traditional actions at common law." See Northern Pipeline, 458 U.S. at 90. The document was
executed prior to a previous FIFRA arbitration, and was intended only to "limit the issues which
the arbitrators must decide." As such, the 1993 Agreement and Stipulation is closely intertwined
with the FIFRA arbitration process itself, thus distinguishing interpretation of the agreement
from a traditional common law contract action. Nor does the fact that the Agreement and
Stipulation may involve other private interests give rise to a violation of Article III. "Many
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matters that involve the application of legal standards to facts and affect private interests are
routinely decided by agency action with limited or no review by Article III courts." Union
Carbide, 473 U.S. at 583. Hence, the arbitration panel's interim order does not implicate
traditional common law contract rights in violation of Article III.
Moreover, the arbitration panel did not issue the interim order "without consent of the
litigants," as required for an Article III violation. Union Carbide, 473 U.S. at 584. Syngenta
itself initiated the pending arbitration proceeding under FIFRA. Syngenta Opp'n at 3. And
although the 1993 Agreement and Stipulation did not contain an arbitration clause, it was crafted
to inform subsequent FIFRA arbitration proceedings. See 1993 Agreement and Stipulation at 1
("[T]he parties have requested the arbitration panel to decide upon the compensability of the
studies which comprise the Data" and "wish to limit the issues which the arbitrators must decide
and shorten the length of the hearing."). The Agreement and Stipulation also contemplated
further arbitration and future data requests in the maintenance of atrazine registrations by
Syngenta and Drexel. 1993 Agreement and Stipulation ¶¶ 2, 5, 8. The Constitution is not
offended when parties are willing to arbitrate, which underscores that the arbitration panel's
interim order does not violate Article III. See Union Carbide, 473 U.S. at 584.
Finally, judicial review of an alleged Article III violation is only available if the plaintiff
can "demonstrate it has been or inevitably will be subjected to an exercise of such
unconstitutional jurisdiction." Union Carbide, 473 U.S. at 580. At this early stage in the
arbitration proceedings, it is impossible to determine what weight, if any, the arbitration panel
will place on the 1993 Agreement and Stipulation. It is therefore not yet clear that the arbitration
panel's consideration of the document will constitute the adjudication of a private contract claim,
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as Syngenta alleges. Hence, even if Northern Pipeline were to bar the adjudication of such a
claim, it is simply too early for the Court to determine that abuse by the arbitrator is "inevitable"
so as to vest jurisdiction under FIFRA in this Court.
In sum, the arbitration panel's decision to admit the 1993 Agreement and Stipulation does
not constitute arbitrator misconduct reviewable by a district court under FIFRA. The panel's
decision to consider the Agreement and Stipulation also does not violate Article III of the
Constitution because it will not "inevitably" transform the present arbitration proceedings into an
adjudication of traditional contract rights. Therefore, the Court does not possess subject matter
jurisdiction under either the federal question or diversity statutes, as limited by FIFRA.
II. Remaining Subject Matter Jurisdiction Claims
Syngenta's remaining assertions of subject matter jurisdiction also fail. Syngenta first
argues that the Court has subject matter jurisdiction under the APA, 5 U.S.C. §§ 701-06. But the
APA "'is not a jurisdiction-conferring statute.'" Oryszak v. Sullivan, No. 07-01141, slip op. at 4
(D.C. Cir. Aug. 14, 2009) (quoting Trudeau v. FTC, 456 F.3d 178, 183 (D.C. Cir. 2006)).
Rather, actions arising under the APA confer federal question jurisdiction, limited by the specific
judicial review provisions of the APA. Id. The question, then, is whether the complaint states a
claim under the APA, which grants judicial review to a party "adversely affected or aggrieved by
agency action." 5 U.S.C. § 702. "[N]othing in the APA authorizes claims against non-federal
entities." Karst Envtl. Educ. & Prot., Inc. v. EPA, 475 F.3d 1291, 1298 (D.C. Cir. 2007). Here,
the only remaining defendants in this action would be non-federal entities: Drexel and the AAA.
Indeed, this is consistent with the purpose of the FIFRA arbitration scheme -- to remove data
compensation valuation from "agency personnel to civilian arbitrators." Union Carbide, 473
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U.S. at 590. Absent "agency action," then, Syngenta's complaint fails to state a claim under the
APA.1
Similarly, the mandamus statute, 28 U.S.C. § 1361, does not confer subject matter
jurisdiction in this case. The statute grants "district courts . . . original jurisdiction of any action
in the nature of mandamus to compel an officer or employee of the United States or any agency
thereof to perform a duty owed to the plaintiff." 28 U.S.C. § 1361. The remedy of mandamus is
available "only if: (1) the plaintiff has a clear right to relief; (2) the defendant has a clear duty to
act; and (3) there is no other adequate remedy available to plaintiff." Power v. Barnhart, 292
F.3d 781, 784 (D.C. Cir. 2002). The act sought to be compelled must be a "clear and
nondiscretionary duty." Orlov, 523 F. Supp. 2d at 37. But Syngenta does not seek to compel "an
officer or employee of the United States or any agency thereof" -- both Drexel and the AAA
arbitration panel are private, not federal, entities. 28 U.S.C. § 1361. Syngenta also fails to allege
a single "clear and nondiscretionary duty" that federal officials failed to perform -- even if the
AAA arbitration panel was a federal agency, the decision to exclude evidence was within the
discretion of the arbitrators. See PPG Industries, 637 F. Supp. at 87 (explaining that the
arbitrators have broad discretion in deciding what is relevant to deciding a data compensation
dispute). Consequently, there is no subject matter jurisdiction for a mandamus claim in this case.
Finally, neither the Declaratory Judgment Act nor the All Writs Act provide an
independent basis for jurisdiction. "[T]he All Writs Act allows the Court to order a remedy only
where subject matter jurisdiction already exists." Carson v. U.S. Office of Special Counsel, 563
1
As the D.C. Circuit recently clarified, an APA claim lacking "agency action" is properly
dismissed for failure to state a claim, not for a lack of jurisdiction. See Oryszak, slip op. at 4-5
& n.2.
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F. Supp. 2d 286, 288 (D.D.C. 2008). Similarly, "the Declaratory Judgment Act is not an
independent source of federal jurisdiction." C&E Servs., Inc. v. D.C. Water & Sewer Auth., 310
F.3d 197, 201 (D.C. Cir. 2002); see also Schilling v. Rogers, 363 U.S. 666, 677 (1960) (finding
that the Declaratory Judgment Act "presupposes the existence of a judicially remediable right").
Because Syngenta has not established subject matter jurisdiction independent of the Declaratory
Judgment Act or the All Writs Act, it cannot independently assert subject matter jurisdiction
under these statutes.
CONCLUSION
For the foregoing reasons, the Court will grant Drexel’s motion to dismiss. A separate
order accompanies this opinion.
/s/
JOHN D. BATES
United States District Judge
Dated: August 24, 2009
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