# WOLVERINE PIPELINE CO — Notice of Probable Violation - **operation:** document - **citation:** CPF 320195016 - **title:** WOLVERINE PIPELINE CO — Notice of Probable Violation - **source type:** enforcement - **agency:** Pipeline and Hazardous Materials Safety Administration - **status:** historical - **official:** true - **published on:** 2019-04-11 - **effective on:** Not available - **summary:** CLOSED notice of probable violation citing 195.420(a), 195.424(a), 195.446(c)(1), 195.446(c)(2), 195.452(c), 195.452(d), 195.452(h)(4)(i), 195.452(h)(4)(iii), 195.452(l)(1)(ii), 195.579(a), 195.581(a). - **machine formats:** - **json:** https://regulus.evalyn.ai/document/phmsa-enforcement-320195016.json - **markdown:** https://regulus.evalyn.ai/document/phmsa-enforcement-320195016.md - **app url:** https://regulus.evalyn.ai/document/phmsa-enforcement-320195016 - **source url:** https://primis.phmsa.dot.gov/enforcement-data/case/320195016 **body:** Notice of Probable Violation involving WOLVERINE PIPELINE CO. PHMSA's enforcement data identifies the cited regulations as 195.420(a), 195.424(a), 195.446(c)(1), 195.446(c)(2), 195.452(c), 195.452(d), 195.452(h)(4)(i), 195.452(h)(4)(iii), 195.452(l)(1)(ii), 195.579(a), 195.581(a). The case was opened on 2019-04-11 and is reported as closed as of 2023-07-12. Proposed civil penalty: $121,800. Assessed civil penalty: $65,800. Open the official case record for notices, responses, orders, and the latest status. Official case documents: 320195016_Closure Letter_02242021.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195016/320195016_Closure%20Letter_02242021.pdf 320195016_Closure Letter_02242021_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195016/320195016_Closure%20Letter_02242021_text.pdf 320195016_Closure Letter_07122023_(16-155088S).pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195016/320195016_Closure%20Letter_07122023_(16-155088S).pdf 320195016_Closure Letter_07122023_(16-155088S)_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195016/320195016_Closure%20Letter_07122023_(16-155088S)_text.pdf 320195016_Decision on Petition for Reconsideration_02022021.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195016/320195016_Decision%20on%20Petition%20for%20Reconsideration_02022021.pdf 320195016_Decision on Petition for Reconsideration_02022021_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195016/320195016_Decision%20on%20Petition%20for%20Reconsideration_02022021_text.pdf 320195016_Final Order_09032020.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195016/320195016_Final%20Order_09032020.pdf 320195016_Final Order_09032020_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195016/320195016_Final%20Order_09032020_text.pdf 320195016_Hearing Scheduled_08202019.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195016/320195016_Hearing%20Scheduled_08202019.pdf 320195016_Hearing Scheduled_08202019_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195016/320195016_Hearing%20Scheduled_08202019_text.pdf 320195016_NOPV PCP_04112019.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195016/320195016_NOPV%20PCP_04112019.pdf 320195016_NOPV PCP_04112019_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195016/320195016_NOPV%20PCP_04112019_text.pdf 320195016_Op Pet for Review (US Court of Appeals for 6th Circuit)_04292021_(16-155088S).pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195016/320195016_Op%20Pet%20for%20Review%20(US%20Court%20of%20Appeals%20for%206th%20Circuit)_04292021_(16-155088S).pdf 320195016_Operator Petition for Reconsideration_09282020.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195016/320195016_Operator%20Petition%20for%20Reconsideration_09282020.pdf 320195016_Operator Post-Hearing Submission_01302020.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195016/320195016_Operator%20Post-Hearing%20Submission_01302020.pdf 320195016_Operator Pre-Hearing Submissions_10252019.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195016/320195016_Operator%20Pre-Hearing%20Submissions_10252019.pdf 320195016_Operator Response to Notice and Request for Hearing_07222019.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195016/320195016_Operator%20Response%20to%20Notice%20and%20Request%20for%20Hearing_07222019.pdf 320195016_PHC Hearing Scheduled_08272019.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195016/320195016_PHC%20Hearing%20Scheduled_08272019.pdf 320195016_US Court of Appeal Decision_06022023_(16-155088S).pdf: https://primis.phmsa.dot.gov/enforcement-documents/320195016/320195016_US%20Court%20of%20Appeal%20Decision_06022023_(16-155088S).pdf 320195016_US Court of Appeal Decision_06022023_(16-155088S).pdf Case: 21-3405 Document: 32-1 Filed: 06/02/2023 Page: 1 (1 of 24) Deborah S. Hunt Clerk UNITED STATES COURT OF APPEALS FOR THE SIXTH CIRCUIT 100 EAST FIFTH STREET, ROOM 540 POTTER STEWART U.S. COURTHOUSE CINCINNATI, OHIO 45202-3988 Tel. (513) 564-7000 www.ca6.uscourts.gov Filed: June 02, 2023 Mr. Jeremy C Marwell Mr. Ronald J. Tenpas Vinson & Elkins 2200 Pennsylvania Avenue, N.W., Suite 500 W. Washington, DC 20037 Mr. Casen Ross Ms. Abby Christine Wright U.S. Department of Justice 950 Pennsylvania Avenue, N.W. Washington, DC 20530 Re: Case No. 21-3405, Wolverine Pipe Line Company v. DOT, PHMSA Originating Case No. : 3-2019-5016 Dear Counsel, The court today announced its decision in the above-styled case. Enclosed is a copy of the court’s published opinion together with the judgment which has been entered in conformity with Rule 36, Federal Rules of Appellate Procedure. Yours very truly, Deborah S. Hunt, Clerk Cathryn Lovely Deputy Clerk Enclosures Mandate to issue. Case: 21-3405 Document: 32-2 Filed: 06/02/2023 Page: 1 (2 of 24) RECOMMENDED FOR PUBLICATION Pursuant to Sixth Circuit I.O.P. 32.1(b) File Name: 23a0116p.06 UNITED STATES COURT OF APPEALS FOR THE SIXTH CIRCUIT ┐ WOLVERINE PIPE LINE COMPANY, │ Petitioner, │ > No. 21-3405 │ v. │ │ UNITED STATES DEPARTMENT OF TRANSPORTATION, │ Pipeline and Hazardous Materials Safety │ Administration, │ │ Respondent. ┘ On Petition for Review from the United States Department of Transportation, Pipeline and Hazardous Materials Safety Administration. No. 3-2019-5016. Argued: March 10, 2022 Decided and Filed: June 2, 2023 Before: BATCHELDER, NALBANDIAN, and READLER, Circuit Judges. _________________ COUNSEL ARGUED: Joshua S. Johnson, VINSON & ELKINS, LLP, Washington, D.C., for Petitioner. Casen B. Ross, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Respondent. ON BRIEF: Joshua S. Johnson, Ronald J. Tenpas, Jeremy C. Marwell, VINSON & ELKINS LLP, Washington, D.C., for Petitioner. Casen B. Ross, Abby C. Wright, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Respondent. NALBANDIAN, J., delivered the opinion of the court in which READLER, J., joined. BATCHELDER, J. (pp. 19–22), delivered a separate dissenting opinion. Case: 21-3405 Document: 32-2 Filed: 06/02/2023 Page: 2 (3 of 24) No. 21-3405 Wolverine Pipe Line Co. v. DOT, PHMSA Page 2 _________________ OPINION _________________ NALBANDIAN, Circuit Judge. The Pipeline and Hazardous Materials Safety Administration imposed a civil penalty on Wolverine Pipe Line Company for violating two of its pipeline regulations. Wolverine claims this action was arbitrary and capricious and violated its due process rights. We disagree, and we affirm the agency’s decision and deny Wolverine’s petition. I. A. Regulatory Framework. More than two million miles of pipeline crisscross the United States. These pipelines carry oil, gasoline, and natural gas from state to state, powering American homes, infrastructure, and industry along the way. But with energy reward comes risk. Pipelines can leak, fail, or spill, hurting the environment or wreaking havoc in populated areas. To protect against such risks, Congress enacted a series of pipeline safety laws. See 49 U.S.C. §§ 60101 et seq. These laws direct the Secretary of Transportation to issue minimum safety standards for pipelines. Id. § 60102(a)(2). The Secretary, in turn, delegates this standard- issuing authority to an agency: the Pipeline and Hazardous Materials Safety Administration. See 49 C.F.R. § 1.97. The agency, PHMSA for short, has used this authority to issue a host of regulations. Although these regulations are complex, PHMSA’s collaborative approach to pipeline safety is simple. That is, the regulations grant pipeline operators flexibility on the front end, but PHMSA approves operators’ plans and verifies their regulatory compliance on the back end. Examples illustrate the point. For instance, pipeline operators retain discretion to develop and implement their own integrity management programs, or IMPs. These IMPs set plans for periodic pipeline assessments, as well as remedial plans for any pipeline repair issues an assessment brings to light. See generally 49 C.F.R. § 195.452(b). What’s more, in many instances, the regulations allow operators to choose the methodology they will use to conduct Case: 21-3405 Document: 32-2 Filed: 06/02/2023 Page: 3 (4 of 24) No. 21-3405 Wolverine Pipe Line Co. v. DOT, PHMSA Page 3 those assessments. By implementing “performance-based standards,” the regulations permit operators to choose an assessment method that best fits the needs of their specific pipelines. 65 Fed. Reg. 75,382, 75,388 (Dec. 1, 2000). This front-end flexibility requires back-end verification. To that end, PHMSA approves operators’ IMPs and reviews operators’ records to check for regulatory compliance. The regulations here, known as the integrity management regulations, fit this collaborative mold. Taking specific aim at spill prevention in “high consequence areas,” these regulations set repair standards for pipelines that transport hazardous liquids. See 49 C.F.R. § 195.452(h); PHMSA, HL IM Performance Measures, https://www.phmsa.dot.gov/pipeline/ hazardous-liquid-integrity-management/hl-im-performance-measures (last updated Jan. 28, 2020). The standards start with discovery, which “occurs when an operator has adequate information to determine that a condition presenting a potential threat to the integrity of the pipeline exists.” 49 C.F.R. § 195.452(h)(2). Under PHMSA’s timeline, an operator must discover an integrity issue “promptly, but no later than 180 days” after it receives an assessment that identifies the problem. Id. Post-discovery, PHMSA classifies integrity issues on a spectrum. The higher the risk, the faster an operator must act. In this vein, some especially dangerous repair conditions require immediate repair. If an operator identifies an immediate repair condition—like certain metal loss, a predicted pipe burst—or, as relevant here, a pipeline dent—it “must temporarily reduce the operating pressure or shut down the pipeline until the operator completes the repair of the[] condition[]” to “maintain safety.” Id. § 195.452(h)(4)(i). Other repairs, like 180-day or 60-day conditions, require less urgent treatment. Id. § 195.452(h)(4)(ii)-(iv). Although an operator must complete the repair within a given timeline, it needn’t reduce pressure or shut down the pipeline. With this background in mind, we turn to Wolverine’s case. B. Factual Background. Wolverine transports refined petroleum products in its 700-mile pipeline system. These pipelines run from refineries in the Chicago area to terminals and other Case: 21-3405 Document: 32-2 Filed: 06/02/2023 Page: 4 (5 of 24) No. 21-3405 Wolverine Pipe Line Co. v. DOT, PHMSA Page 4 pipelines in and around Indiana and Michigan. Because Wolverine transports refined petroleum, a hazardous liquid, the company falls into PHMSA’s regulatory orbit. A few years ago, PHMSA conducted a routine inspection of Wolverine’s records, procedures, and facilities. That inspection identified several issues. So not long after, PHMSA sent Wolverine a Notice of Probable Violation, or a NOPV. The Notice, which acts as an informal charging document for the agency, described nine potential violations of PHMSA’s regulations. Only two of those items—“Item 5” and “Item 6”—matter here. 1. Item 5 We begin with the events prompting Item 5. An in-line inspection report (ILI report) landed in the inbox of Daniel Cooper, Wolverine’s only risk management specialist at the time, on June 10, 2015.1 But Cooper didn’t open the ILI report for another 13 days. Why? On June 10, Cooper was on vacation. And right after, Wolverine sent him on a work trip. Cooper explained that he “did not have access to email” on vacation. (Hr. Tr., A385.) Later, he noted that he “may have seen the e-mail, but [he] did not open the report until [he] got back from [his] travels.” (Id.) In any event, Cooper eventually returned to the office and read the report on June 23, 2015. The report described a dent with metal loss on the topside of one of Wolverine’s pipe segments. Once Cooper learned about the dent, he sprang into action. First, he reached out to the third-party vendor who prepared the ILI report to confirm that the pipe showed metal loss. After the vendor confirmed, Cooper convened a June 26, 2015 meeting with his Wolverine coworkers. There, they decided to treat the pipeline “anomaly” as a “possible immediate repair.” (Hr. Ex. 29, A589.) As Wolverine worked toward a repair, the operator prepared to implement the temporary pressure reduction the regulations require. 1Pipeline operators typically outsource pipeline assessments to third-party analysts, who prepare ILI reports. These reports give operators a segment-by-segment look at their pipes and identify any integrity issues. Case: 21-3405 Document: 32-2 Filed: 06/02/2023 Page: 5 (6 of 24) No. 21-3405 Wolverine Pipe Line Co. v. DOT, PHMSA Page 5 But this pressure reduction never came to pass. Based on an eight-month-old hydrostatic test,2 Cooper felt “confident” that the dent could withstand any pressure “and was not likely to fail in the next few days.”3 (Hr. Tr., A356.) Besides, in its IMP, Wolverine had interpreted the immediate repair regulation to give it a choice: “[C]omplete” the repair within “up to 5 . . . working days” after an operator determines there is “an immediate repair condition” or “implement a pressure reduction as necessary.” (Hr. Ex. 28, A585; Hr. Tr., A351–53.) Relying on its IMP and the recent testing, and using June 26 as the relevant trigger date, Wolverine took the first path. Within four days of the June 26 meeting, Wolverine completed the repair without implementing a temporary pressure reduction. During the inspection, PHMSA reviewed Wolverine’s response and found it lacking. So Item 5 of the Notice cited Wolverine for a violation of the immediate repair regulation, 49 C.F.R. § 195.452(h)(4)(i)(C). Wolverine, PHMSA explained, had “received a final ILI report on June 10, 2015 . . . claimed a discovery date of June 26, 2015 and completed repairs on the pipeline segment on June 30, 2015.” (NOPV, A71.) But for the time spanning June 10 to June 30, Wolverine “could not provide a record that a temporary pressure reduction was taken.” (Id.) Because Wolverine “failed to temporarily reduce the operating pressure,” the Notice alleged that Wolverine “committed [a] probable violation[]” of the regulation and recommended a $36,000 penalty. (Id. at A68, 71, 74.) And PHMSA’s subsequent Violation Report stated that this violation started on June 10, 2015—the date Cooper received, and failed to open, the ILI report. 2. Item 6 Next, we turn to Item 6. This item dealt with 180-day conditions, rather than immediate repair conditions. One of the 180-day conditions occurs when “[a] calculation of the remaining strength of the pipe shows an operating pressure that is less than the current established 2“A hydrostatic test is performed by subjecting a pipeline to pressures that exceed its maximum operating pressure, thereby identifying the weakest segments of the pipeline.” ExxonMobil Pipeline Co. v. U.S. Dep’t of Transp., 867 F.3d 564, 568 n.1 (5th Cir. 2017). 3According to Wolverine, the average pressure per square inch at the location of the dent hovered around 200 pounds. About a year earlier, in October 2014, the pipe had withstood 1,700 pounds of pressure per square inch during hydrostatic testing. In Cooper’s view, if the pipe withstood 1,700 pounds of pressure per square inch a year earlier, it could withstand 200 pounds of pressure until Wolverine completed the immediate repair. Case: 21-3405 Document: 32-2 Filed: 06/02/2023 Page: 6 (7 of 24) No. 21-3405 Wolverine Pipe Line Co. v. DOT, PHMSA Page 6 maximum operating pressure at the location of the anomaly.” 49 C.F.R. § 195.452(h)(4)(iii)(D). To calculate the remaining strength, the regulation allows operators to use “suitable” methods, including, but not limited to, two methods called the B31G method and the R-STRENG method. Id. Wolverine received another ILI report identifying four such conditions on June 12, 2015. At each anomaly location, the report calculated the remaining strength of the pipes using both the R-STRENG and the B31G method. But the different methods yielded different results. Under the R-STRENG method, the strength value of each anomaly was greater than the maximum operating pressure at that location. But under the B31G method, the strength values were less than the maximum operating pressure at the four anomaly locations. So if Wolverine accepted and confirmed the R-STRENG calculations, the four anomalies would not qualify as 180-day conditions. But if it took the other path, relying on B31G instead, they would. Wolverine took the latter route. With the report in hand, Cooper worked to confirm its contents. But he only recalculated and relied on the B31G values. Indeed, at the agency hearing, Cooper stated he “[n]ormally . . . use[d] [the] B31G [method]” to “prepar[e] repair plans.” (Hr. Tr., A429.) Although he doesn’t “doubt” the R-STRENG values provided in ILI reports, he doesn’t “have all the information necessary to assess [them],” which leads him to “take the more conservative [B31G] approach.” (Id.) Wolverine’s repair plans confirm Cooper’s assessment that Wolverine solely relied on the B31G calculations to classify the four anomalies as 180-day conditions. The plans state that Cooper ran “the modified ASME B31G calculations” and found that four anomalies qualified as 180-day conditions. (JO-KA Repair Plan 10/19/2015, A148–49; JO-KA Repair Plan Summary 10/19/2015, A627.) With the plans complete, Wolverine started on repairs. For two of the anomalies, the company met the 180-day mark. But at the other two locations, it missed the deadline. PHMSA noted the missed deadlines during its inspection. So in Item 6 of its Notice, PHMSA cited Wolverine for violating the 180-day condition regulation and recommended a $39,200 penalty. In response to the Notice, Wolverine provided a written response that admitted it did not meet Case: 21-3405 Document: 32-2 Filed: 06/02/2023 Page: 7 (8 of 24) No. 21-3405 Wolverine Pipe Line Co. v. DOT, PHMSA Page 7 the deadline and assured PHMSA that new procedures were put in place to prevent the violation from happening again. Agency Hearing. After it received the Notice, Wolverine contested PHMSA’s accusations. Its defense started with a request for an agency hearing. See 49 C.F.R. § 190.211. There, the parties debated the Item 5 and Item 6 violations. Wolverine’s approach to Item 5 emphasized June 26 as the discovery date. To understand why, recall the language of the immediate repair regulation: “To maintain safety, an operator must temporarily reduce the operating pressure or shut down the pipeline until the operator completes the repair.” 49 C.F.R. § 195.452(h)(4)(i). In Wolverine’s view, this regulation didn’t impose a categorical command. Instead, it believed the regulation was most naturally read as not requiring the pipeline operator to implement a pressure reduction if the operator could complete the repair quickly. Under that approach, Wolverine contended it didn’t violate the regulation. It discovered the repair on June 26 and completed the repair on June 30 “before there was time to effectuate the pressure reduction.” (Hr. Tr., A391.) For Wolverine to win on this theory, it needed PHMSA to accept the June 26 discovery date. So at the hearing, Wolverine went back and forth with PHMSA’s investigators about Wolverine’s claimed discovery date of June 26. In one such instance, Wolverine’s counsel asked one of PHMSA’s investigators, Ms. Alexander, about the discovery date. Wolverine’s counsel said: “[D]o you dispute that June 26th, 2015, is the date of discovery for this subject condition?” (Hr. Tr., A329.) Alexander answered: “No, I’m not disputing it. That is per Wolverine.” (Id.) But Wolverine’s counsel persisted: “I want to know what you think . . . . Do you have a dispute with June 26th as the discovery date?” (Id.) This time, Alexander simply answered: “No.” (Id.) This conversation, though, was just one of many instances when the parties argued about discovery for Item 5. At the start, Wolverine’s counsel read the Notice to Alexander. Twice counsel asked if the allegation that Wolverine discovered a dent was “the regulatory version of discovery? 49 C.F.R. 195.452(h)(2).” (Id. at A326–327.) Alexander confirmed. She also stated: “Wolverine claims a discovery date.” (Id. at A327.) Later, PHMSA’s lawyer, Ms. Stevens, emphasized that June 26th was “Wolverine’s date.” (Id. at A339.) When Wolverine’s Case: 21-3405 Document: 32-2 Filed: 06/02/2023 Page: 8 (9 of 24) No. 21-3405 Wolverine Pipe Line Co. v. DOT, PHMSA Page 8 counsel retorted that Ms. Alexander “indicated no dispute with that date,” Ms. Stevens clarified “there’s no dispute that Wolverine stated that date [of June 26]. That’s what she’s indicating.” (Id.; see also id. at A341 (“Wolverine claimed the discovery date on June 26th.”).) As for Item 6, Wolverine came to the table with a new theory: The repairs weren’t 180- day conditions under the regulation. To make its case, Wolverine first pointed out that the regulation included both the R-STRENG and B31G as “[s]uitable remaining strength calculation methods.” 49 C.F.R. § 195.452(h)(4)(iii)(D). And under the R-STRENG values, Wolverine contended that the anomalies weren’t 180-day conditions. To shore up its argument, it introduced a new chart that incorporated the R-STRENG values from the ILI report. This chart compared the R-STRENG values with the maximum operating pressure at each anomaly, showing that the R-STRENG value was greater than the maximum operating pressure. So if Wolverine had used the R-STRENG values instead of the B31G values, the repairs wouldn’t have qualified as 180-day conditions. (Hr. Ex. 33, A626; see also Wolverine Post-Hearing Br., A655 (asserting that Wolverine could “have rested on the RSTRENG results and done absolutely nothing”).) Still, as one of PHMSA’s officers pointed out, Wolverine didn’t provide any R-STRENG analysis until October 2019—two years after PHMSA’s inspection and four years after it first formulated its repair plans. PHMSA’s decision. In the end, Wolverine’s arguments at the hearing failed to convince PHMSA. The agency’s Final Order found Wolverine liable for violating both the immediate repair and 180-day condition regulations. And although Wolverine petitioned for reconsideration, the agency stayed firm, upholding both its liability findings and its $65,800 fine. Wolverine now petitions for review of PHMSA’s Item 5 and Item 6 decisions, arguing that each was arbitrary and capricious and contrary to law. II. We review PHMSA’s action under the Administrative Procedure Act. See 49 U.S.C. § 60119(a)(3). Under that Act, we may “set aside” the agency’s decision only if it is “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.” 5 U.S.C. § 706(2)(A). Arbitrary and capricious review is deferential. The question is not what we would Case: 21-3405 Document: 32-2 Filed: 06/02/2023 Page: 9 (10 of 24) No. 21-3405 Wolverine Pipe Line Co. v. DOT, PHMSA Page 9 have done, nor whether we agree with the agency’s action. Rather, the question is whether the agency “examine[d] the relevant data and articulate[d] a satisfactory explanation for its action.” Motor Vehicle Mfrs. Ass’n of U.S., Inc. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983) (explaining that there must be a “rational connection between the facts found and the choice made” (citation omitted)). So long as “the agency’s path may reasonably be discerned,” we will uphold a decision of even “less than ideal clarity.” Alaska Dep’t of Env’t Conservation v. EPA, 540 U.S. 461, 497 (2004) (citation omitted). III. We consider PHMSA’s Item 5 adjudication first. Wolverine contends this decision violated its due process rights and is arbitrary and capricious. PHMSA responds that its conclusion was a textbook application of the immediate repair regulation. We think PHMSA has the better of the two arguments here. The text of the regulation goes a long way to showing why. “To maintain safety,” the regulation tells us, “an operator must temporarily reduce the operating pressure or shut down the pipeline until the operator completes the repair of these conditions.” 49 C.F.R. § 195.452(h)(4)(i) (emphasis added). In its Item 5 decision, PHMSA simply read the regulation to mean what it says. “[C]lear on its face,” the provision informed the regulated community “that, pending repair, an operator must take certain actions.” (Reconsideration Decision, A19.) According to PHMSA, this mandate “does not afford operators the ability to defer a pressure reduction . . . if, in their engineering judgment it is simply more convenient to proceed to a repair.” (Id. at A18.) Put another way, the regulation represents PHMSA’s call that “[t]o maintain safety,” an operator must reduce pressure pending a repair. 49 C.F.R. § 195.452(h)(4)(i). This position, long taken by the agency, leaves no room for an operator, like Wolverine, to impose its own judgment. See, e.g., In the Matter of Centurion Pipeline, LP, CPF No. 4-2014- 5028, 2017 WL 1363408, at *9 (D.O.T. March 30, 2017) (noting that “[i]n prior enforcement proceedings . . . PHMSA has [] determined that § 195.452(h)(4) requires a pressure reduction or a shutdown even if the condition meets immediate repair criteria only after factoring in conservative tool tolerances”); id. (“An operator must immediately reduce pipeline operating Case: 21-3405 Document: 32-2 Filed: 06/02/2023 Page: 10 (11 of 24) No. 21-3405 Wolverine Pipe Line Co. v. DOT, PHMSA Page 10 pressure or shut down a pipeline that has an immediate repair condition.” (emphasis added)); In the Matter of Buckeye Partners, L.P., CPF No. 1-2011-5013, 2012 WL 4025918, at *2 (D.O.T. Jul. 27, 2012) (“Pipeline operators are obligated to take immediate action including temporarily reducing operating pressure . . . .”). No matter the discovery date and no matter the speed of the repair, operators must take steps to reduce the pressure or shut down the pipeline. Wolverine never took these actions. Did it have a dent that met the criteria for an immediate repair? Wolverine admits as much. Did it complete the repair without temporarily reducing the pressure? Wolverine concedes the point. Indeed, during oral argument, Wolverine took the position that whether it opened the letter on June 10 or June 26, it would not have implemented a pressure reduction. In PHMSA’s view, these two concessions were enough to find Wolverine liable for violating the regulation. Wolverine reads the immediate repair regulation differently. It contends that the regulation “cannot reasonably be read to require a pressure reduction or shutdown if the repair can precede those actions.” (Wolverine Reply Br. at 10.) “Any alternative interpretation,” it suggests, would “require[] a repair to be delayed pending implementation of a pressure reduction or shutdown” and “undermine” the regulation’s express “objective of maintaining safety.” (Id. (citation omitted).) So, the argument goes, operators do not need to reduce pressure or shutdown a pipeline if simply repairing it would be faster. But Wolverine’s reading runs headlong into the regulation’s text, which tells operators: “To maintain safety, an operator must temporarily reduce operating pressure or shut down the pipeline until the operator completes the repair of th[at] condition.” 49 C.F.R. § 195.452(h)(4)(i) (emphasis added). This “prophylactic” directive represents PHMSA’s call about the best way to “maintain safety.” (PHMSA Br. at 6 (“Immediate repair conditions are those that PHMSA has determined could result in imminent pipeline failure; the agency thus promulgated this prophylactic measure—requiring an operator to reduce or shut down a pipeline’s pressure while repairing these conditions—to ‘maintain safety’ by minimizing strain on the pipeline and decreasing the prospect of imminent failure.”).) That we can imagine a scenario where an operator could complete a repair before implementing a pressure reduction is of no moment. The text of the regulation is clear. An operator must implement a pressure Case: 21-3405 Document: 32-2 Filed: 06/02/2023 Page: 11 (12 of 24) No. 21-3405 Wolverine Pipe Line Co. v. DOT, PHMSA Page 11 reduction or shut down the pipeline. Wolverine asks us to read an exception into this straightforward directive. We decline to do so.4 Wolverine challenges this conclusion on several additional fronts. It starts with two due process arguments and then makes a Chenery claim. We consider each in turn. Due Process. Before we address the heart of Wolverine’s argument, we begin with a bit of context. The Fifth Amendment’s due process clause applies to “administrative proceedings just as it does to other instances of government action.” Karst Robbins Coal Co. v. Dir., Off. of Workers’ Comp. Programs, 969 F.3d 316, 329 (6th Cir. 2020); see also Mullane v. Cent. Hanover Bank & Tr. Co., 339 U.S. 306, 313 (1950). And in the administrative law context, due process arguments often come in two forms. First, an agency offends due process if it “sustain[s] a charge different from any listed in the complaint,” Hodgins v U.S. Dep’t of Agric., 238 F.3d 421, 430 (6th Cir. 2000) (table) (citations omitted), or “change[s] theories in midstream without giving [] reasonable notice of the change,” Yellow Freight Sys., Inc. v. Martin, 954 F.2d 353, 357 (6th Cir. 1992) (citation omitted). And second, even if an agency “properly construe[s]” a regulation, its action might violate due process if “the regulation is so vague in its requirements that its enforcement would violate” the 4In fact, Wolverine is as likely to fall within its proposed exception as it is to fall outside of it. In other words, it’s not clear how long the pressure reduction process would have taken versus the actual repair. This is because, on the record before us, it doesn’t seem that Wolverine determined how long it would have taken to reduce pressure. (Hr. Tr., A380 (Cooper indicated Wolverine took some steps to “begin[] the” pressure reduction “process” but didn’t know whether Wolverine ever took “further action to actually implement any kind of a pressure reduction” or “what documentation exist[ed].”).) Instead, it seems that Wolverine made a judgment call based on experience. (Id. at A354 (Cooper recommended that Wolverine forego a pressure reduction because it could “get in within just a few days and repair [the pipeline].”); Id. at A356 (In Cooper’s judgment, “if [the] anomaly had survived a 1,700 pound eight-hour test [] it was not likely to fail in the next few days at 50 pounds or maybe 200 pounds.”).) Later, the operator posited that it “might have achieved a pressure reduction ‘as soon as possible,’ and safely so, but never will we know since the repair was effected so quickly.” (Wolverine Post-Hearing Br., A662.) “Never will we know” about sums up the record on this issue. Wolverine can point to no record evidence—other than its own uncorroborated statements to the contrary—that shows it could have completed the repair “before there was time to effectuate a pressure reduction.” (Wolverine Br. at 34 (citation omitted).) Finally, Wolverine is not in a great position to be advocating for an interpretation that is grounded in speediness. Wolverine, after all, received information identifying an immediate repair on June 10 and completed that repair on June 30. During that time, as PHMSA noted, Wolverine took a “lackadaisical approach,” failing to even open the report for 13 days. (Reconsideration Decision, A20.) Then, acting on its own, Wolverine found a pressure reduction unnecessary because it could complete the repair quickly. Given the 20 days between receipt of the report and the repair, Wolverine had no excuse for its failure to act. Case: 21-3405 Document: 32-2 Filed: 06/02/2023 Page: 12 (13 of 24) No. 21-3405 Wolverine Pipe Line Co. v. DOT, PHMSA Page 12 Fifth Amendment. Diebold, Inc. v. Marshall, 585 F.2d 1327, 1335 (6th Cir. 1978); see also Ohio Cast Prods., Inc. v. OSHA, 246 F.3d 791, 798–99 (6th Cir. 2001); Albert C. Lin, Refining Fair Notice Doctrine: What Notice is Required of Civil Regulations? 55 Baylor L. Rev. 991, 1001 (2003) (explaining that courts often treat “[w]hether an agency’s interpretation is permissible and whether an agency gave adequate notice of that interpretation” as “separate issues”). Wolverine claims that the agency’s actions violated both strands of due process doctrine. First, Wolverine contends that PHMSA “violated due process by relying on a novel theory of untimely discovery not adequately alleged” in the Notice. (Wolverine Br. at 30 (cleaned up).) In other words, Wolverine argues it lacked fair notice that the agency took issue with its claimed discovery date of June 26. (Id. at 37–38.) Second, Wolverine asserts it lacked fair notice that its conduct would violate the discovery regulation because the regulation’s mandate to act “promptly” is unconstitutionally vague. (Id. at 42–43.) We reject Wolverine’s argument that it did not know its claimed discovery date would be at issue in the proceedings. Wolverine’s claimed discovery date played an “ancillary part” throughout the proceedings. (Reconsideration Decision, A21.) This is because an operator’s “obligation to [reduce pressure] is dictated by when it discovers that it has an immediate repair condition on its pipeline.” (Id. at A17.) And so PHMSA sought to determine when that obligation kicked in. Right off the bat, PHMSA’s informal charging documents put Wolverine on notice that the agency took issue with the operator’s timeline. The Notice began by faulting Wolverine for failing to “temporarily reduce the operating pressure when it discovered a dent.” (NOPV, A71.) It then added that “Wolverine received a final ILI report on June 10, 2015” but “claimed a discovery date of June 26, 2015 and completed repairs on June 30, 2015.” (Id.) In addition, PHMSA’s follow-on Violation Report listed “the [d]ate the violation started” as June 10, 2015. (Violation Report, A112.) These documents gave Wolverine sufficient warning that PHMSA took issue both with the time between the receipt of the ILI report and the repair and with Wolverine’s failure to implement a pressure reduction during that time. See ECM BioFilms, Inc. v. FTC, 851 F.3d 599, 618 (6th Cir. 2017) (“Although the complaint does not define ‘reasonably Case: 21-3405 Document: 32-2 Filed: 06/02/2023 Page: 13 (14 of 24) No. 21-3405 Wolverine Pipe Line Co. v. DOT, PHMSA Page 13 short period of time’ as a specific time period, that level of detail was unnecessary to ‘reasonably apprise’ [the company] of the issues in controversy.”). Next, Wolverine’s own actions confirm that it understood that PHMSA took issue with the time between the receipt of the ILI report and the repair. At the agency hearing, Wolverine tried to pin PHMSA down on the June 26 discovery date. And the parties wrangled over the discovery date multiple times.5 Also, leading up to this discussion about Wolverine’s claimed discovery date, Wolverine had a line of questioning about how quickly operators must reduce pressure when an immediate repair condition is identified. Again, in its post-hearing recommendation (which Wolverine responded to), PHMSA took issue both with the time between the receipt of the ILI report and the repair and with Wolverine’s failure to implement a pressure reduction. So it is not true that PHMSA shifted its theory from alleging that Wolverine violated the immediate repair regulation by failing to reduce pressure to alleging that Wolverine violated the immediate repair regulation by failing to reduce pressure in a timely fashion. Timeliness was an “ancillary” issue throughout. (Reconsideration Decision, A21.) And at the end of the day, PHMSA found that Wolverine violated the immediate repair regulation without fixing a discovery date, without charging Wolverine with a discovery regulation violation, cf. Carlisle Equip. Co. v. Sec’y of Lab. & Occupational Safety, 24 F.3d 790, 795 (6th Cir. 1994); Yellow 5Wolverine contends that certain exchanges between its counsel and Alexander (a PHMSA investigator) confirmed that PHMSA didn’t dispute its claimed discovery date. But viewing the transcript as a whole, it’s clear that’s not the case. (Hr. Tr., A326–27 (Wolverine Counsel: “[The notice] says that Wolverine discovered a dent. Top line over to the right side. Discovered a dent.” Alexander: “I didn’t say they discovered a dent. I said Wolverine claims a discovery date.” Wolverine Counsel: “We’ll come to that in a moment . . . .”); Id. at A329 (Wolverine Counsel: “Regarding the statement that Wolverine claimed a discovery date of June 26, 2015, do you dispute that June 26, 2015, is the date of discovery for this subject condition?” Alexander: “No, I’m not disputing it. That is per Wolverine.” Later, Wolverine Counsel: “Do you have a dispute with June 26 as the discovery date?” Alexander: “No.”); Id. at A338–39 (Wolverine Counsel: “Just a couple things inside the violation report . . . . [T]here is a question, the date of violation started and it says what date.” Alexander: “It says June 10, 2015.” Later, Wolverine Counsel: “Why did you start that on receipt of the ILI report? Earlier you suggested that the action needed to be taken — you didn’t suggest. You stated very clearly the actions should occur upon discovery of the condition. What date was that?” PHMSA Counsel: “Wolverine’s date. That’s what — Wolverine’s discovery date was June 26.” Wolverine Counsel: “She indicated no dispute with [the 26th].” PHMSA counsel: “Well, there’s no dispute that Wolverine stated that date [June 26]. That’s what [Alexander’s] indicating.”); Id. at 340–41 (Alexander states that the violation report didn’t talk about discovery and she “didn’t contest discovery.” Wolverine Counsel: “That’s right. And the discovery in the NOPV is stated as what date?” Alexander: “Wolverine claimed the discovery date on June 26.”).) Case: 21-3405 Document: 32-2 Filed: 06/02/2023 Page: 14 (15 of 24) No. 21-3405 Wolverine Pipe Line Co. v. DOT, PHMSA Page 14 Freight, 954 F.2d at 355, 358, and without changing its theory of the case, cf. Bendix Corp. v. FTC, 450 F.2d 534, 542 (6th Cir. 1971).6 Chenery. Wolverine next invokes Chenery I and Chenery II, arguing that PHMSA shifted its reasoning on appeal. This matters because agency action “cannot be upheld unless the grounds upon which the agency acted in exercising its powers were those upon which its action can be sustained.” SEC v. Chenery Corp., 318 U.S. 80, 95 (1943). Wolverine points to the fact that, during the agency proceedings, PHMSA acknowledged that discovery played an “ancillary” part of its immediate-repair regulation analysis and spent much time chastising Wolverine for its “lackadaisical approach.” (Reconsideration Decision, A20–21.) But on appeal, PHMSA left out that chastisement, asserting that “any dispute as to when Wolverine discovered the dent that required repair is orthogonal to the regulatory requirement that Wolverine reduce or shutoff the pipeline pressure.” (PHMSA Br. at 28.) Wolverine argues these differences in framing require us to vacate the agency’s order below. We disagree. Whatever the space between “ancillary” and “orthogonal,” it doesn’t change our outcome here. Chenery “tells us not to sustain an administrative order on a different ground from the one the agency offered.” MISO Transmission Owners v. FERC, 860 F.3d 837, 843 (6th Cir. 2017); Chenery Corp., 318 U.S. at 94–95; accord SEC v. Chenery Corp., 332 U.S. 194, 196 (1947). It doesn’t keep this Court from upholding an agency action “on the same basis articulated in the order by the agency itself.” Burlington T - **truncated:** true - **body characters:** 132726