Case 2:20-cv-00111-RAJ Document 94 Filed 03/06/20 Page 1 of 23
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` HONORABLE RICHARD A. JONES
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`UNITED STATES DISTRICT COURT
`WESTERN DISTRICT OF WASHINGTON
`AT SEATTLE
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`Case No. 2:20-cv-00111-RAJ
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`ORDER GRANTING IN PART
`PLAINTIFF STATES’ MOTION
`FOR PRELIMINARY
`INJUNCTION
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`STATE OF WASHINGTON; et al.,
`Plaintiffs,
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`v.
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`UNITED STATES DEPARTMENT OF
`STATE; et al,
`Defendants.
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`
`INTRODUCTION
`I.
`This matter comes before the Court on the Plaintiff States’ Motion for Preliminary
`Injunction (“Motion”). Dkt. # 55. For the reasons below, the Court GRANTS IN PART
`the Motion.
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`ORDER – 1
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`Case 2:20-cv-00111-RAJ Document 94 Filed 03/06/20 Page 2 of 23
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`II. BACKGROUND
`Plaintiffs are seventeen States challenging companion regulations promulgated by
`the Department of State and the Department of Commerce. This action is the latest in a
`series of litigation over export controls on technical data related to 3-D printed firearms.
`The Court examines the statutory framework and prior litigation before turning to its
`analysis.
`Arms Export Control Act (“AECA”)
`A.
`The AECA regulates the export of arms, ammunition, and other military and
`defense technology. 22 U.S.C. § 2778(a)(1). It delegates to the President the task of
`creating the United States Munitions List (“Munitions List”), which designates certain
`items as defense articles and defense services. Id. The term “defense articles” specifically
`includes “technical data recorded or stored in any physical form, models, mockups or
`other items that reveal technical data directly relating to items designated in” the
`Munitions List. 22 C.F.R. § 120.6. Category I of the Munitions List includes “Firearms,
`Close Assault Weapons and Combat Shotguns.” 22 C.F.R. § 121.1. “Nonautomatic and
`semi-automatic firearms to caliber .50 inclusive,” their “components, parts, accessories
`and attachments,” and related “technical data” are currently within Category I. Id. §
`121.1(a), (h), (i).
`The AECA also tasks the President with promulgating regulations for the import
`and export of such defense articles and services. 22 U.S.C. § 2778(a)(1). The President
`has delegated his authority to promulgate implementing regulations to the Secretary of
`State. Those regulations, the International Traffic in Arms Regulations (“ITAR”), are
`administered by the DDTC [Directorate of Defense Trade Controls] and its employees. 22
`C.F.R. § 120.1(a). Under ITAR, persons who want to export items on the Munitions List
`must first obtain a license from the Department of State (“State Department”).
`Export Control Reform Act
`B.
`The Department of Commerce (“Commerce”) regulates exports pursuant to the
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`ORDER – 2
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`Case 2:20-cv-00111-RAJ Document 94 Filed 03/06/20 Page 3 of 23
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`Export Control Reform Act of 2018, 50 U.S.C. §§ 4801-52 (“ECRA”), which directs that
`export controls be used to “further significantly the foreign policy of the United States,” to
`“fulfill [the] declared international obligations” of the United States, or to limit exports
`that would make a “significant contribution to the military potential of any other country
`or . . . would prove detrimental to . . . national security.” Id. § 4811(1)(A)-(B).
`To carry out these purposes, the ECRA directs that Commerce shall “establish and
`maintain a list of items that are controlled”—the Commerce Control List (“CCL”)—and
`“prohibit unauthorized exports, reexports, and in-country transfers of controlled items.” 50
`U.S.C. § 4813(a)(1), (3). The Export Administration Regulations (“EAR”), 15 C.F.R.
`parts 730-774, implement the ECRA, identifying the items and activities subject to the
`jurisdiction of the EAR as well as those not subject to the EAR. The EAR’s definition of
`“export” is comprehensive, and extends to, inter alia, “(1) An actual shipment or
`transmission out of the United States, including the sending or taking of an item out of the
`United States, in any manner;” or “(2) Releasing or otherwise transferring ‘technology’ or
`source code (but not object code) to a foreign person in the United States (a ‘deemed
`export’).” 15 C.F.R. § 734.13(a).
`Prior Litigation
`C.
`Computer software for the production of a Category I firearm or its components
`using a 3-D printer (“3-D gun files”), such as computer aided design (CAD) files, is
`“technical data” subject to the AECA and ITAR. Since about 2013, it had been the
`government’s position that posting 3-D gun files on the internet was an “export” subject to
`the AECA and ITAR. Defense Distributed, a private company with the stated objective of
`facilitating global, unrestricted access to firearms and evading gun-safety laws, challenged
`the government’s authority in a lawsuit filed in the United States District Court for the
`Western District of Texas. Distributed v. U.S. Dep’t of State, C15-0372RP (W.D. Tex).
`The company alleged that the government’s prepublication approval requirements under
`ITAR were unconstitutionally applied to its gun-related speech. Id. Defense Distributed
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`ORDER – 3
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`Case 2:20-cv-00111-RAJ Document 94 Filed 03/06/20 Page 4 of 23
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`sought an injunction so that it could post its 3-D gun files on the internet without
`restriction to allow people to easily produce their own weapons and weapon parts using
`relatively affordable and readily available equipment.
`Throughout the litigation, the government argued that the export of certain Defense
`Distributed 3-D gun files could “cause serious harm to U.S. national security and foreign
`policy interests” that “warrant subjecting [the files] to ITAR’s export licensing regime.”
`Dkt. # 32 at 19-20 (W.D. Tex.). The government specifically expressed that the 3-D gun
`files could be modified to create lethal firearms that were “virtually undetectable” by
`conventional security measures such as metal detectors. Additionally, the government
`contended that permitting unrestricted access to the 3-D gun files on the internet would
`increase the risk of their use in assassinations, in manufacturing spare component parts by
`embargoed nations, terrorist groups, or guerrilla groups, or in compromising aviation
`security overseas in a manner specifically directed at U.S. persons or interests. Id. The
`government also argued that “the available alternatives clearly would be ineffective at
`preventing the broad circumvention of export controls for munitions technology.” Dkt. #
`92 at 27 (W.D. Tex.). The district court ultimately denied Defense Distributed’s motion
`for preliminary injunction and the Fifth Circuit affirmed. Defense Distributed v. U.S.
`Dep’t of State, 838 F.3d 451, 458 (5th Cir. 2016). The Fifth Circuit highlighted the State
`Department’s very strong public interest in national defense and national security, noting
`that the unregulated export of the 3-D gun files could cause permanent harm. Id. at 458.
`In April 2018, Defense Distributed and the federal government reached a tentative
`agreement to settle the dispute. Dkt. # 57 at 75-83. Pursuant to the settlement, the State
`Department reversed its prior regulatory and litigation positions on publishing 3-D gun
`files. It now agreed to (i) publish a notice of proposed rulemaking and final rule that
`removes certain 3-D gun files from the Munitions List; (ii) announce a temporary
`modification of the Munitions List to allow immediate distribution while the final rule was
`in development; and (iii) issue a letter to Defense Distributed and others advising that 3-D
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`ORDER – 4
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`Case 2:20-cv-00111-RAJ Document 94 Filed 03/06/20 Page 5 of 23
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`gun files were approved for public release and unlimited distribution. Id.
`One month later, on May 24, 2018, the State Department published a notice of
`proposed rulemaking that implicated the technical data at issue in the Defense Distributed
`litigation. 83 Fed. Reg. 24,198 (May 24, 2018). By the proposed rule, the State
`Department would no longer have the authority to control the export of certain 3-D gun
`files, but instead Commerce would control such exports under a companion regulation.
`See 83 Fed. Reg. 24,166 (May 24, 2018). During the comment period, some members of
`the public recognized the regulation implicated 3-D gun files and raised concerns that
`Commerce lacked authority to control the export of “published” items. Dkt. # 80-2; Dkt.
`# 85-1, ¶ 51. They argued that these regulations would ineffectively guard against the
`proliferation of 3-D gun files posted on the internet. Id. The public comment on the
`proposed rules ended on July 9, 2018. The Defense Distributed settlement agreement was
`made public the following day. As contemplated by the settlement agreement, the
`temporary modification was published and the letter to the private defendants was issued
`on July 27, 2018.
`The temporary modification of the Munitions List was the subject of a 2018 lawsuit
`filed by eight States in this Court. State of Washington v. United States Department of
`State, No. C18-1115RSL (W.D. Wash.) (“State of Washington”). Addressing the
`government’s jurisdictional challenges, this Court ruled that issues concerning the State
`Department’s process for removing items from the Munitions List, its compliance with the
`standards furnished by AECA, and the adequacy of the agency’s analysis of and
`explanation for its decision were subject to judicial review under the Administrative
`Procedure Act (“APA”). State of Washington, 318 F.Supp.3d 1247, 1255 (W.D. Wash.
`2018). The Court later concluded that the government’s decision to modify the Munitions
`List was arbitrary and capricious and procedurally improper in violation of the APA.
`2019 WL 6892505 (W.D. Wash. Nov. 12, 2019).
`On January 23, 2020, the State Department published its final rule revising the
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`ORDER – 5
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`Munitions List. 85 Fed. Reg. 3819 (Jan. 23, 2020) (“State Rule”). The State Rule
`confirmed the removal of “all non-automatic firearms up to .50 caliber” and “related
`technical information” from Category I. The removed items would again be subject to a
`companion Commerce regulation. See 85 Fed. Reg. 4136 (Jan. 23, 2020) (“Commerce
`Rule”). Collectively, the Final Rules also announced a new jurisdictional change
`pertaining to 3-D gun files: Notwithstanding Commerce’s jurisdictional exemption for
`“published” technology or software, it would now retain jurisdiction over files “for the
`production of a firearm, or firearm frame or receiver” that are “made available by posting
`on the internet in electronic format” and are “ready for insertion” in a 3-D printer or
`similar equipment. Id. The Final Rules are set to go into effect on March 9, 2020.
`On January 23, 2020, the States filed this lawsuit challenging the Final Rules under
`the APA. Dkt. # 1. The States contend that the Final Rules amount to a toothless
`prohibition on 3-D gun files that will lead to their widespread proliferation, including on
`the internet. After amending their complaint, the States filed this motion for a preliminary
`injunction. Dkt. # 55. On February 11, 2020, the National Shooting Sports Foundation,
`Inc. and Fredric’s Arms & Smiths, LLC jointly moved to intervene as defendants. Dkt. #
`63. The Court considered and granted their motion for the reasons indicated in their
`briefing. On February 24, 2020, the federal defendants, including Commerce and the
`State Department, and the intervenor defendants filed their oppositions. On February 27,
`2020, the States filed their reply. Dkt. # 87. On February 28, 2020, the Court held oral
`argument. Dkt. # 88. By March 5, 2020, the parties filed post-hearing briefing on the
`scope of injunctive relief. Dkt. ## 89-92. The Court has considered all submissions and
`argument to date.
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`III. LEGAL STANDARD
`To issue a preliminary injunction, the Court must determine whether plaintiffs (1)
`are likely to succeed on the merits of their claim; (2) are likely to suffer irreparable harm
`in the absence of preliminary relief; (3) have shown that the balance of equities tips in
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`ORDER – 6
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`their favor, and (4) have shown that an injunction is in the public interest. Short v. Brown,
`893 F.3d 671, 675 (9th Cir. 2018) (citing Winter v. Nat. Res. Def. Council, Inc., 555 U.S.
`7, 20 (2008)). In the alternative, “if a plaintiff can only show that there are serious
`questions going to the merits—a lesser showing than likelihood of success on the merits—
`then a preliminary injunction may still issue if the balance of hardships tips sharply in the
`plaintiff’s favor, and the other two Winter factors are satisfied.” Feldman v. Ariz. Sec. of
`State’s Office, 843 F.3d 366, 375 (9th Cir. 2016) (quoting Shell Offshore, Inc. v.
`Greenpeace, Inc., 709 F.3d 1281, 1291 (9th Cir. 2013)) (internal quotation marks omitted,
`emphasis in original).
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`IV. DISCUSSION
`The States bring three claims under APA. First, they claim that the federal
`defendants failed to abide by the APA’s notice-and-comment requirements. Second, they
`claim that the federal defendants’ actions were “arbitrary and capricious” in failing to
`consider relevant national security and foreign policy interests. Their final claim argues
`that the State Rule is contrary to the AECA.
`Standing
`A.
`As they did in State of Washington, the federal defendants challenge the Court’s
`jurisdiction over this matter. The basis for the challenge remains the same: the States
`cannot meet prudential standing requirements and present a non-justiciable political
`question. The Court agrees with the States that the analysis is no different here than it was
`in State of Washington.
`To present a justiciable case or controversy under Article III, plaintiffs must
`demonstrate an “injury in fact” that is “fairly traceable” to the defendants’ actions and will
`likely be redressed by a favorable decision. See Lujan v. Defenders of Wildlife, 204 U.S.
`555, 560 (1992). In an APA action, a state alleging a procedural violation has standing if
`there is a possibility that the relief requested will prompt the agency to reconsider the
`decision allegedly causing harm. Mass. v. EPA, 549 U.S. 497, 517 (2007). In addition, a
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`ORDER – 7
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`State has a legally protectable interest if it has a sovereign, quasi-sovereign, or proprietary
`interest that would be impacted by the litigation. Dep’t of Fair Emp’t & Hous. v. Lucent
`Techs., 642 F.3d 728, 753 n.5 (9th Cir. 2011).
`This Court in State of Washington ruled that the States sufficiently alleged harm to
`their legally protectable sovereign interests under the traditional standing analysis.
`Specifically, the Court found that the government’s alleged failure to provide notice or
`make a reasonable evaluation of the risks and benefits of the proposed action would
`greatly impact aviation and other security breaches, as well as gun control laws both
`abroad and at home. 318 F.Supp.3d at 1255-56. The Court also concluded that the States
`had standing to bring a procedural APA claim because there was a possibility that
`compelling compliance with the specified procedures would impact the decision-making
`process: “Forcing the federal defendants to evaluate the effect of the proposed delisting on
`world peace, national security, and the foreign policy of the United States (factors which
`Congress intended the President or his designee to consider) may also prompt a
`reconsideration of the decision to remove the CAD files from the [Munitions List].” Id.
`The federal defendants try to distinguish the States’ case for standing here but fall
`short in doing so. They again disclaim any possible connection between a shift in the
`government’s export-control regulations and domestic injury to States—an argument
`made and rejected in State of Washington. 318 F.Supp.3d at 1255 (describing this
`argument as “so myopic and restrictive as to be unreasonable”). That argument still fails
`now as neither the global nature of the internet nor the substantial risk of harm alleged has
`changed.1 The federal defendants also argue that, since the State Department has already
`reconsidered its decision to remove items from Munitions List and issued final rules to
`that effect, the States cannot show traceability. Dkt. # 82 at 32. However, claims resting
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`1 The government also contends that the States’ injury in State of Washington was based
`on “particular files” that would produce undetectable firearms whereas the injury alleged
`here is not. Dkt. # 84 at 31. However, the States allege that those files and similar ones
`will be impacted by the Final Rules. See Dkt. # 54 at ¶¶ 103, 106.
`ORDER – 8
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`on a procedural injury, including failure to provide notice and comment, relax some
`standing requirements. Ctr. for Biological Diversity v. Mattis, 868 F.3d 803, 817 (9th Cir.
`2017). There is also little to suggest that further reconsideration could not prompt change
`of the agency’s decisions—e.g., changing the adequacy of Commerce’s jurisdiction over
`the 3-D gun files. See Massachusetts, 549 U.S. at 518. Accordingly, the Court finds that
`States have shown Article III standing.
`Plaintiffs suing under the APA must also show their interests fall “arguably within
`the zone of interests” protected or regulated by the violated statute. Match-E-Be-Nash-She
`Wish Band of Pottawatomi Indians v. Patchak, 567 U.S. 209, 224 (2012). This is met here.
`The States’ interest in curbing violence, assassinations, terrorist threats, aviation and other
`security breaches, and violations of gun control laws within their borders is at least
`marginally related to the national security interests protected or regulated by the AECA and
`the ECRA. 22 U.S.C. § 2778(a)(1) (declaring the security of the United States as an
`objective underlying the AECA); 50 U.S.C. § 4811 (same as to the ECRA).
`Political Question
`B.
`While the political question doctrine raises both jurisdictional and prudential
`concerns, “it is at bottom a jurisdictional limitation imposed on the courts by the
`Constitution, and not by the judiciary itself.” Corrie v. Caterpillar, 503 F.3d 974, 981 (9th
`Cir. 2007). “[J]udicial restraint in the area of foreign affairs is often appropriate because
`such cases ‘frequently turn on standards that defy judicial application, or involve the
`exercise of a discretion demonstrably committed to the executive or legislature.’” Harbury
`v. Hayden, 522 F.3d 413, 419 (D.C. Cir. 2008) (quoting Baker v. Carr, 369 U.S. 186, 211
`(1962)).
`The Court is not persuaded that this case lies beyond judicial cognizance. The
`federal defendants have framed this dispute as the States attacking whether a particular
`item is on the Munition List, a matter of policy entrusted to Congress and the President.
`Dkt. # 84 at 27 (citing United States v. Mandel, 914 F.2d 1215, 1223 (9th Cir. 1990)).
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`ORDER – 9
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`This is incorrect. The States again are challenging whether federal agencies complied
`with the APA in promulgating the Final Rules. “This is neither a political question nor
`one committed to the agency’s discretion.” State of Washington, 2019 WL 5892505, at
`*5.
`C.
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`Likelihood of Success on the Merits
`The APA sets forth the extent of judicial authority to review executive agency
`action. Under the APA, the district court may not set aside an agency’s action unless it is
`“arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law ...”
`5 U.S.C. § 706(2)(A); Safari Aviation Inc. v. Garvey, 300 F.3d 1144, 1150 (9th Cir.
`2002). Review under this standard is narrow, and the court must not substitute its
`judgment for that of the agency. Id. at 1150.
`1. Exemptions Under the AECA and ECRA –
`The federal defendants argue that the States cannot succeed on the merits because
`the Final Rules are explicitly exempt from judicial review under the APA. Although the
`APA embodies a “basic presumption of judicial review,” such review is not available “to
`the extent that” a relevant statute precludes it, § 701(a)(1), or the agency action is
`“committed to agency discretion by law,” § 701(a)(2).
`The federal defendants point specifically to § 4821 of the ECRA and § 2778(h) of
`the AECA. Section 4821(a) exempts the “functions exercised” under the ECRA from the
`judicial review provisions of the APA. The States’ challenge to the Commerce Rule,
`when viewed in isolation, appears to fall within this exemption. Insofar as § 4821 bars
`judicial review of the Commerce Rule, however, the States argue that the agencies’ “joint
`action” of removing items from the Munitions List and transferring jurisdiction to
`Commerce is still reviewable via the State Rule.2 Dkt. # 87 at 8. This Court has
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`2 The State Department referred to the process as an ongoing interagency effort in which
`the Department coordinated principally with the Departments of Defense and Commerce
`and the Department of Justice’s Bureau of Alcohol, Tobacco, Firearms and Explosives to
`develop revisions to the Munitions List and CCL. Dkt. # 85-1 at ¶ 38.
`ORDER – 10
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`acknowledged that § 2778(h)’s prohibition on judicial review does not apply to removals
`from the Munitions List. See State of Washington, 318 F.Supp.3d at 1260 (“The decision
`at issue here, however, is the removal of an item from the [Munitions List], which
`Congress chose not to make unreviewable.”). Accordingly, the Court will evaluate joint
`actions to the extent that they are reflected in the decision to remove the 3-D gun files
`from the Munitions List.
`2. Foreign Affairs Exemption
`The federal defendants argue separately that the APA’s foreign affairs exemption
`exempts the State Rule from the notice-and-comment requirement. Under the foreign
`affairs exception, the APA’s notice-and-comment procedures do not apply “to the extent
`that there is involved—a ... foreign affairs function of the United States.” 5 U.S.C. §
`553(a)(1); E. Bay Sanctuary Covenant v. Trump, 932 F.3d 742, 775 (9th Cir. 2018). The
`purpose of the exemption is to allow more cautious and sensitive consideration of those
`matters which “so affect relations with other Governments that, for example, public rule-
`making provisions would provoke definitely undesirable international consequences.”
`H.Rep. No. 1980, 69th Cong., 2d Sess. 23 (1946); see also, S.Rep. No. 752, 69th Cong.,
`1st Sess. 13 (1945). Courts have required the government to do more than merely say that
`a rule “implicates” foreign affairs and have disapproved use of the exception where the
`Government has failed to offer evidence of consequences that would result from
`compliance with the APA’s procedural requirements. E. Bay Sanctuary Covenant, 932
`F.3d 742 at 776.
`The federal defendants state that the Final Rules are part of a decade-long reform to
`the export-control system. Since 2010, the State Department has published 26 final or
`interim rules with the goal of removing “less sensitive items from the [Munitions List].”
`Dkt. # 85-1 at ¶¶ 33-34. With this history, the evidence of undesirable international
`consequence needed to invoke the foreign affairs exemption is missing. E.g., Rajah v.
`Mukasey, 544 F.3d 427, 437 (2d Cir. 2008) (rule responding to September 11, 2001
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`ORDER – 11
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`attacks). “The court is simply unwilling to apply the exception without some evidence to
`support its application.” Doe v. Trump, 288 F. Supp. 3d 1045, 1076 (W.D. Wash. 2017).
`The federal defendants argue that 22 C.F.R. § 128.1, an AECA regulation,
`demonstrates that the exemption applies. Section 128.1 acknowledges the Secretary of
`State’s power under the AECA “to make decisions on whether license applications or
`other written requests for approval shall be granted, or whether exemptions may be used,”
`and “to revoke, suspend or amend licenses or other written approvals whenever the
`Secretary deems such action deemed advisable.” The section goes onto say the
`“administration” of the AECA is a foreign affairs function within the meaning of the
`APA. Id. The federal defendants claim that removing an item from the Munitions List
`falls within § 128.1’s purview. However, nothing in the language of § 128.1, or in the
`AECA’s predecessor statute, supports the federal defendants’ expansive reading. See Pub.
`L. No. 83-665, 68. Stat. 832, 848 (1954) (granting authority to designate defense articles
`for munitions control to the President); 20 Fed. Reg. 6250, 6256 (Aug. 26, 1955)
`(excluding the designation of such articles and subsequent registration and licensing
`decisions from APA review). The Court concludes that the foreign affairs exception is
`inapplicable.
`3. Notice and Comment
`The Court turns to whether the federal defendants complied with notice-and-
`comment procedures in promulgating the State Rule. The APA requires an agency to
`notify the public of—and provide the public with an opportunity to comment on—the
`agency’s intention to change an existing regulation or to promulgate a new regulation.
`See 5 U.S.C. §§ 553(b), 553(c), 551(5). Adequate notice is crucial to “ensure that agency
`regulations are tested via exposure to diverse public comment,” “to ensure fairness to
`affected parties,” and “to give affected parties an opportunity to develop evidence in the
`record to support their objections to the rule and thereby enhance the quality of judicial
`review.” Int’l Union, United Mine Workers of Am. v. Mine Safety & Health Admin., 626
`
`ORDER – 12
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`Case 2:20-cv-00111-RAJ Document 94 Filed 03/06/20 Page 13 of 23
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`F.3d 84, 95 (D.C. Cir. 2010) (citation omitted).
`The Ninth Circuit has held that when a court considers whether an agency has
`satisfied the APA’s notice requirement, the “essential inquiry focuses on whether
`interested parties reasonably could have anticipated the final rulemaking from the draft
`[proposal].” Nat. Res. Def. Council v. EPA, 279 F.3d 1180, 1186 (9th Cir. 2002). In
`determining this, courts should consider “whether a new round of notice and comment
`would provide the first opportunity for interested parties to offer comments that could
`persuade the agency to modify its rule.” Id. (quoting Am. Water Works Ass’n v. EPA, 40
`F.3d 1266, 1274 (D.C. Cir. 1994)). While a final rule need not be identical to the draft
`proposal, it must be a logical outgrowth of the proposed rule. Id. The States argue that
`the federal defendants gave no notice of their intent to regulate 3-D guns files. Dkt. # 55
`at 14. Specifically, the States complain that the notices of proposed rulemaking
`(“NPRMs”) failed to mention 3-D printed guns at all and otherwise gave no indication that
`3-D gun files would be subject to unique jurisdiction under Commerce. Moreover,
`because the settlement agreement with Defense Distributed was not revealed until after the
`public comment period closed, the States argue that they were denied a right to comment
`on the “hidden-but-intended” effect of the Rules. Id. at 14.
`Binding case law instructs that where a final rule’s substance is “not foreshadowed
`in proposals and comments advanced during the rulemaking,” it will not be considered a
`“logical outgrowth” because it may catch interested parties by surprise. Nat. Res. Def.
`Council, 279 F.3d at 1186. Prior to the publication of the Final Rules, neither agency gave
`any indication that a specific regulation would apply to the online dissemination of 3-D
`gun files.3 The State Department’s proposed rule only said that “removed items” would
`be subject to controls published in Commerce’s proposed companion rule. 83 Fed. Reg.
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`3 Commerce all but acknowledges this fact in the notice of final rulemaking. 85 Fed. Reg.
`4136, 4141–42 (explaining that the framework of Commerce’s regulations as described in
`the proposed rule did not “adequately address the issue of regulating the unlimited access
`to certain files for the 3D printing of firearms”).
`ORDER – 13
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`Case 2:20-cv-00111-RAJ Document 94 Filed 03/06/20 Page 14 of 23
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`24,198-01. Commerce’s proposal confirmed “[i]tems that would move to the CCL would
`be subject to existing EAR concepts of jurisdiction and controls related to ‘development’
`and ‘production,’ as well operation, installation, and maintenance ‘technology.’” 83 Fed.
`Reg. 24,166-01 (emphasis added). The substantive change in the Final Rules—that
`Commerce would retain now jurisdiction over 3-D gun files “made available by posting
`on the internet” and “ready for insertion” into a 3-D printer—seemingly comes out of left
`field.
`The federal defendants say the State Department received an array of comments
`about 3-D firearm files which demonstrate the public had meaningful notice of the
`combined regulatory effect of the two rules. Dkt. # 84 at 37. This argument is blunted by
`the fact that the NPRMs fail to mention 3-D gun files at all. See CSX Transp., Inc. v.
`Surface Transp. Bd., 584 F.3d 1076, 1080 (D.C. Cir. 2009) (holding that a final rule
`“violates the APA’s notice requirement where ‘interested parties would have had to divine
`[the agency’s] unspoken thoughts’”(alteration in original) (quoting Int’l Union, United
`Mine Workers of Am. v. Mine Safety & Health Admin., 407 F.3d 1250, 1259–60 (D.C.
`Cir. 2005))). Additionally, the State Department’s notice of proposed rulemaking purports
`to keep defense articles “not otherwise widely available for commercial sale” within its
`jurisdiction while transferring to Commerce “many items which are widely available in
`the United States and abroad.” 83 Feg. Reg. 24198-01. Omissions that would permit
`potentially controversial subject matter to go unnoticed fail to “fairly apprise interested
`persons of the subjects and issues before the Agency.” See Natural Res. Def. Council,
`279 F.3d at 1186; Louis v. U.S. Dep’t of Labor, 419 F.3d 970, 975–76 (9th Cir. 2005).
`Of course, not every violation of the APA invalidates an agency action. The failure
`to provide notice and comment is harmless only where the agency’s mistake “clearly had
`no bearing on the procedure used or the substance of decision reached.” Sagebrush
`Rebellion, Inc. v. Hodel, 790 F.2d 760, 764–65 (9th Cir. 1986); see Hodge v. Dalton, 107
`F.3d 705 (9th Cir. 1997) (rule merely made explicit what was already implicit in the
`
`ORDER – 14
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`legislative history of the EEOC’s authority). Here, the States s