UNITED STATES DISTRICT COURT - MLive.commedia.mlive.com/news/detroit_impact/other/complaint.pdf · united states district court ... plaintiffs, -vs.- the united states department

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UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

DETROIT INTERNATIONAL BRIDGE COMPANY and THE CANADIAN TRANSIT COMPANY, Plaintiffs, -vs.- THE UNITED STATES DEPARTMENT OF STATE, JOHN KERRY, in his official capacity as Secretary of State, THE CANADA-UNITED STATES-ONTARIO-MICHIGAN BORDER TRANSPORTATION PARTNERSHIP, THE UNITED STATES FEDERAL HIGHWAY ADMINISTRATION, VICTOR MENDEZ, in his official capacity as Administrator of the United States Federal Highway Administration, RAY LAHOOD, in his official capacity as Secretary of Transportation, THE GOVERNMENT OF CANADA, THE WINDSOR-DETROIT BRIDGE AUTHORITY, THE UNITED STATES COAST GUARD, ADM. ROBERT J. PAPP, JR., in his official capacity as Commandant of the United States Coast Guard, JANET NAPOLITANO, in her official capacity as Secretary of Homeland Security, and THE UNITED STATES OF AMERICA, Defendants.

Docket No. 10-cv-476-RMC

THIRD AMENDED COMPLAINT

As and for their Third Amended Complaint, plaintiffs Detroit International Bridge

Company (“DIBC”) and the Canadian Transit Company (“CTC”) state as follows:

Case 1:10-cv-00476-RMC Document 105 Filed 05/29/13 Page 1 of 116

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NATURE OF THE CASE

1. This is an action for declaratory and injunctive relief to declare, define, and

enforce the franchise rights held by plaintiffs DIBC and CTC to build, own, and operate the

international bridge crossing between Detroit, Michigan and Windsor, Canada. This action also

seeks to set aside and declare invalid actions taken by United States officers and agencies that

have breached the franchise rights of DIBC and CTC, and have otherwise been contrary to law,

arbitrary, capricious, and otherwise in violation of the standards set forth in 5 U.S.C. § 706(2).

This action also seeks a declaration and injunction against the Government of Canada for actions

taken in the United States to further its commercial venture to build a new bridge between

Detroit and Windsor, which seeks to usurp plaintiffs’ ability to maintain their franchise by

building a new span to their existing Ambassador Bridge, and thereby violates the special

agreement that created the plaintiffs’ Ambassador Bridge franchise, which is enforceable against

Canada through the legislation Canada enacted to create that special agreement (i.e., the “CTC

Act,” as further defined below).

2. For over 80 years, the plaintiffs and their predecessors have held and exercised a

perpetual and exclusive franchise right, granted by statute and treaty, to construct, own, operate,

and maintain the toll bridge franchise across the Detroit River between Detroit, Michigan, and

Windsor, Ontario; to collect tolls from vehicles crossing the bridge; and to exercise other

specified powers in connection with these rights.

3. Plaintiffs’ bridge, known as the Ambassador Bridge, carries more than one

quarter of the total commercial traffic between the United States and Canada. The Ambassador

Bridge, like all other toll bridges, is a commercial enterprise. Plaintiffs’ principal revenue source

consists of tolls collected from vehicles passing in each direction across the bridge. Plaintiffs


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also earn additional revenue through leases at the Ambassador Bridge. Plaintiffs’ expenses

include, among other things, expenses for maintenance and operation of the bridge and the

associated facilities. The Ambassador Bridge competes for traffic and toll revenue with the

nearby Detroit-Windsor Tunnel, rail tunnels and ferries, and other international border crossings,

including the Blue Water Bridge between Port Huron, Michigan and Sarnia, Ontario.

4. The franchise granted to DIBC and CTC to construct, maintain, and operate the

Ambassador Bridge between Detroit and Windsor was created by concurrent and reciprocal

legislation enacted by the United States Congress and the Canadian Parliament in 1921,

expressly identifying DIBC’s predecessor company and CTC as the sole entities receiving the

franchise. That legislation constituted a “special agreement” between the United States and

Canada under the 1909 Boundary Waters Treaty. Under that treaty, no bridge may be built over

the boundary waters between the United States and Canada except as specified in the treaty.

Neither the Boundary Waters Treaty nor the United States and Canadian legislation creating a

special agreement to allow for the construction of the Ambassador Bridge has ever been repealed

or amended. In addition, the United States Congress and the Canadian Parliament have never

purported to grant a second franchise for a bridge between Detroit and Windsor, or to enter into a

new special agreement that would allow for the construction of a new bridge between Detroit

and Windsor that complies with the terms of the Boundary Waters Treaty.

5. As the United States Congress and the United States Department of State have

both recognized, the franchise granted to DIBC and CTC includes the right to repair, replace, and

enlarge the Ambassador Bridge, including by building a twin span right next to the existing span.

This right to expand or twin the Ambassador Bridge is subject only to general regulatory

requirements (relating to navigation and environmental issues). Subject only to those


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requirements, DIBC and CTC have the right to build a new span to the Ambassador Bridge

without obtaining any additional franchise rights, without needing to seek Presidential or

Congressional approval, and without requiring any further action to satisfy the requirements of

the Boundary Waters Treaty.

6. For over a decade, DIBC and CTC have been attempting to build a new span

(“New Span”) to the Ambassador Bridge that would upgrade the existing facility, reduce costly

and disruptive maintenance required for the existing facility, and substantially improve the

efficiency with which traffic can be funneled into specialized lanes in the customs plazas on

either side of the border. While the New Span would be a desirable upgrade and modernization

to the Ambassador Bridge, it is not needed to address traffic levels: indeed, overall traffic levels

have been decreasing over the past decade, and the existing crossings between Detroit and

Windsor are more than adequate to meet any reasonable projection of traffic demands for the

next several decades. The economic justification for the New Span is therefore not found in

increased traffic levels, but instead in reduced maintenance costs and enhanced efficiency in the

transit process through customs. DIBC and CTC intend to finance the construction of the New

Span entirely with private financing.

7. The defendants are violating, or threatening to violate, plaintiffs’ franchise rights

in the Ambassador Bridge, including the right to build the New Span. Specifically, in violation

of plaintiffs’ exclusive franchise rights, and in an effort to frustrate and preclude plaintiffs from

exercising their right to build the New Span, the Canadian Government has entered into an

agreement (the “Crossing Agreement”) with the Governor of Michigan, the Michigan

Department of Transportation (“MDOT”), and the Michigan Strategic Fund (“MSF”) to build a

new bridge between Detroit and Windsor that is to be located in the immediate vicinity of the


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Ambassador Bridge (less than two miles away). The new bridge is known variously as the

Detroit River International Crossing (“DRIC”) and the New International Trade Crossing

(“NITC”) (referred to hereinafter as the “NITC/DRIC”).

8. The construction of the NITC/DRIC will infringe and violate the franchise rights

conferred upon DIBC and CTC by the United States Congress and the Canadian Parliament. The

United States Congress and the Canadian Parliament have not entered into a special agreement

granting a franchise for the construction of the NITC/DRIC, and therefore the construction of the

NITC/DRIC would violate both the Boundary Waters Treaty and the franchise rights conferred

upon DIBC and CTC. Studies published by Canada and its United States partners that support

construction of the NITC/DRIC estimate that up to 75% of the Ambassador Bridge’s truck traffic

and up to 39% of its passenger traffic will be diverted to the NITC/DRIC. Thus, the NITC/DRIC

threatens to destroy the economic viability of the Ambassador Bridge: at a minimum, it will

destroy the economic viability of the New Span that the plaintiffs have an acknowledged

franchise right to build.

9. In addition to violating plaintiffs’ franchise rights, the NITC/DRIC Crossing

Agreement is also an unconstitutional agreement between agents of a U.S. State, on behalf of

that State, and a foreign power. Article I, § 10, clause 3 of the United States Constitution

provides that “No State shall, without the Consent of Congress, . . . enter into any Agreement or

Compact with another State, or with a foreign Power . . . .” The United States Congress has not

provided its consent to the Crossing Agreement entered into between the Michigan Governor,

MDOT, MSF, and the Government of Canada. Thus, the Crossing Agreement is

unconstitutional and should be declared to be illegal, invalid, void, and unenforceable.


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10. The Crossing Agreement invokes Article I, § 10 of the Constitution, but fails to

comply with it. The Crossing Agreement makes no reference to the requirement that it be

approved by Congress. Instead, it provides that it will become effective once approved by the

Secretary of State. This is apparently based upon a section of the International Bridge Act of

1972 (“IBA”), which provides that Congress consents to a State government entering into an

agreement with a foreign government regarding the construction of an international bridge if

(and only if) the Secretary of State approves that agreement. 33 U.S.C. §§ 535a. But the State

Department has admitted that the IBA provides no principle, much less an intelligible principle,

for the Secretary of State to apply in determining whether to approve such an agreement between

a State and a foreign power. Both the United States Supreme Court and the Court of Appeals for

the D.C. Circuit have repeatedly held that Congress may not delegate to an Executive agency a

power assigned to Congress under the Constitution unless Congress provides an “intelligible

principle” for the Executive agency to apply. Because the IBA fails to provide such an

intelligible principle, the Secretary of State may not constitutionally exercise the Congressional

power and responsibility for approving the Crossing Agreement pursuant to Article I, § 10 of the

Constitution. Thus, the IBA fails to satisfy the constitutional requirement that Congress must

consent to the Crossing Agreement.

11. Defendants have also violated plaintiffs’ franchise rights by thwarting plaintiffs’

ability to exercise their right to build the New Span, and by attempting to accelerate the

approvals of the NITC/DRIC to prevent plaintiffs from exercising their right to build the New

Span. Defendants know that there is no economic justification or need for the NITC/DRIC,

which is likely to cost hundreds of millions, if not billions, of federal dollars. They also know

that there is a sound economic justification for upgrading and modernizing the Ambassador


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Bridge through construction of the New Span (which will be privately financed and will not cost

any government money), but that this economic justification will be destroyed if the NITC/DRIC

is constructed right next to the Ambassador Bridge, thereby capturing the minimum traffic flows

needed to justify further investment in the Ambassador Bridge.

12. Thus, in an effort to ensure that plaintiffs will not be able to exercise their right to

build the New Span, defendants have sought to accelerate the approval of the NITC/DRIC and to

delay the regulatory approvals for the New Span. In particular, some or all of the defendants

have engaged in the following conduct:

Without any rational basis or explanation, the United States Coast Guard has refused to grant DIBC’s application for a navigational permit, which was first submitted to the Coast Guard in 2004, and was deemed “complete” by the Coast Guard in the summer of 2006.

The Coast Guard initially announced that the New Span was exempt from the requirement to conduct an environmental assessment under the National Environmental Policy Act (“NEPA”). It then reversed course in 2006 and decided that an environmental assessment under NEPA was required. In February of 2009, the Coast Guard issued a proposed Finding of No Significant Impact (“FONSI”), but over the past three and a half years, the Coast Guard has refused to finalize this FONSI, despite express sign off from the Environmental Protection Agency (“EPA”), and despite the absence of any evidence of the New Span causing any significant environmental impact.

In contrast, the U.S. Federal Highway Administration (“FHWA”) accelerated the NEPA process for the NITC/DRIC. The NITC/DRIC is a far larger and more environmentally impactful project, yet the FHWA managed to push through its NEPA process in just three years, as compared to the six years in which the smaller New Span project has been stalled as a result of the Coast Guard’s refusal to finalize its NEPA review.

Similarly, the Government of Canada has refused to process the plaintiffs’ 2007 application for environmental approval for the New Span. By contrast, the far more environmentally problematic NITC/DRIC received its environmental approval in less than a year.

In legislation passed in December 2012, the Canadian Parliament exempted

the NITC/DRIC from the Canadian Environmental Assessment Act, the Canadian Port Authority Environmental Assessment Regulations, the


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Statutory Instruments Act, and numerous other statutes and regulations, and provided that after the NITC/DRIC is constructed, all relevant permits and authorizations shall be “deemed to have been issued.” Canadian officials have publicly stated that the goal of this legislation is to “insulate” the NITC/DRIC, an extraterritorial commercial endeavor; expedite its construction, including in the United States; and prevent the owners of the Ambassador Bridge from any ability to challenge any related unfair treatment toward the NITC/DRIC.

13. As the foregoing demonstrates, defendants have taken a series of steps to

discriminate in favor of the NITC/DRIC and against the New Span. These actions reflect a

longstanding desire on the part of the Canadian Government to eliminate private ownership of

the Detroit-Windsor bridge crossing, and an ongoing effort by Canada to persuade United States

government agencies to create a government-owned bridge that will substantially replace and

destroy the privately-owned Ambassador Bridge franchise. Indeed, in an October 13, 2004

email, an official of the Canadian Government admitted that building the NITC/DRIC would

enable Canada to appropriate the Ambassador Bridge for less than its fair market value: Canada

“might be in a much stronger position to negotiate a reasonable price [for the Ambassador

Bridge] if the new crossing [i.e., the NITC/DRIC] is operational and capture[s] a substantial

share of the market of the existing operations [i.e., the plaintiffs’ Ambassador Bridge].” To that

end, Canada has taken a number of steps to undermine plaintiffs’ ability to compete with the

proposed NITC/DRIC, including by insisting on placing the proposed NITC/DRIC in a location

that would prevent the Ambassador Bridge traffic from using any new road improvements

constructed for the Canadian side of the NITC/DRIC.

14. Moreover, the United States Department of State is now contributing to the

violation of plaintiffs’ franchise rights. On July 11, 2012, the Department of State published a

notice in the Federal Register informing the public that on June 21, 2012, the Governor of

Michigan had submitted an application for a Presidential permit to build the NITC/DRIC


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(“NITC/DRIC Application”). [77 Fed. Reg. No. 133 (July 11, 2012) (the “State Department

Notice of Application”)]. The NITC/DRIC Application also sought approval for the Crossing

Agreement. In response to this State Department Notice of Application, plaintiffs submitted a

Comment on August 9, 2012 and a Supplemental Comment and an Executive Summary on

September 10, 2012. Plaintiffs asked the State Department to confirm that it would not consider

the NITC/DRIC Application due to the Application’s numerous legal infirmities, but the State

Department was unwilling to give such confirmation. Instead, it indicated that it would consider

the NITC/DRIC Application and use its own “broad discretion” in deciding whether to approve

the Crossing Agreement.

15. The fact that the State Department would consider approval of the Crossing

Agreement and the NITC/DRIC was evidence of defendants’ infringement of plaintiffs’

franchise rights. First, as alleged above, the State Department does not have the constitutional

authority to approve the Crossing Agreement for the purposes of Article I, § 10 of the

Constitution. Second, as also alleged above, the Crossing Agreement sought to violate plaintiffs’

franchise rights established by United States statute and treaty, but the State Department has no

authority to abrogate those rights. Third, the State Department has previously stated that the

NITC/DRIC and the Crossing Agreement could not be considered for approval unless and until

the Michigan Legislature approved the project. The Michigan Legislature has not only failed to

approve the project, but also affirmatively rejected the project on numerous occasions. In

particular, on October 20, 2011, the Michigan Senate’s Economic Development Committee

voted not to report to the Michigan Senate proposed legislation that was necessary to authorize

the building of the NITC/DRIC. (It was this legislative rejection, which should have terminated

the NITC/DRIC project, that caused plaintiffs to withdraw all but one of the claims contained in


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their First Amended Complaint filed June 6, 2011.) Given that the Michigan Legislature has

refused to provide the required approval for the NITC/DRIC, the State Department should not

have even considered the Michigan Governor’s unauthorized request that it approve the

NITC/DRIC.

16. Indeed, on four different occasions, the Michigan Legislature has enacted statutes

providing that MDOT and MSF “shall not commit the state to any new contract related to the

construction planning or construction of the Detroit River International Crossing.” [See Act of

June 29, 2012, 2012 Michigan Pub. Acts 236, § 402(1), 2012 Mi. ALS 236 (2012); Act of Jun.

26, 2012, 2012 Mich. Pub. Acts 200, § 384(1), 2012 Mi. ALS 200 (2012); Act of Jun. 21, 2011,

2011 Mich. Pub. Acts 63, § 925(a), 2011 Mi. ALS 63 (2011); Act of Sep. 30, 2010, 2010 Mich.

Pub. Acts 191, § 925(a), 2010 Mi. ALS 191 (2010)]. By executing the Crossing Agreement,

both MDOT and MSF have blatantly violated Michigan state law. It is likewise well-established

that the Governor does not have the authority under the Michigan Constitution to enter into an

agreement with a foreign power absent legislative approval.

17. Despite these infirmities, which plaintiffs raised with the State Department

numerous times, the State Department published a notice in the Federal Register on April 18,

2013 announcing that it had issued the NITC/DRIC a Presidential Permit. This Presidential

Permit said nothing about any approval of the Crossing Agreement. However, in response to a

request from plaintiffs’ counsel, lawyers for the United States provided a letter (which was

apparently not ever made public) dated April 12, 2013, purportedly sent by the State Department

to legal counsel for the Governor of Michigan, reporting that the State Department had granted

approval of the Crossing Agreement.


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18. The fact that the State Department considered and approved the illegally-executed

Crossing Agreement, which directly violated express prohibitions enacted by the Michigan

Legislature, is further evidence that defendants are committed to discriminate against the

privately-owned New Span and in favor of the government-owned NITC/DRIC: based on that

discriminatory intent, defendants have taken a series of actions to accelerate the approval of the

NITC/DRIC no matter what legal infirmities may exist, to delay the regulatory approvals of the

New Span no matter what its legal merits, and thereby to defeat plaintiffs’ ability to exercise

their established franchise right to build their New Span.

19. Accordingly, to protect their rights from further infringement, plaintiffs file this

Third Amended Complaint seeking a judicial declaration that (a) the State Department’s granting

of a Presidential Permit for the NITC/DRIC was contrary to law, arbitrary and capricious, and

otherwise in violation of the standards set forth in 5 U.S.C. § 706(2), and should be set aside by

this Court and/or declared to be unenforceable and invalid; (b) the State Department’s purported

approval of the Crossing Agreement was contrary to law, arbitrary and capricious, and otherwise

in violation of the standards set forth in 5 U.S.C. § 706(2), and should be set aside by this Court

and/or declared to be unenforceable and invalid, including because the United States

Constitution did not authorize the State Department to approve the Crossing Agreement, and the

IBA’s purported authorization of such approval is unconstitutional; (c) even if section 3 of the

IBA is constitutional, the IBA does not authorize the approval of any new bridge between Detroit

and Windsor, and does not impliedly repeal or otherwise modify plaintiffs’ statutory and

contractual franchise rights to operate the Ambassador Bridge and to build the New Span; (d) the

franchise rights conferred upon DIBC and CTC were violated by the approval of the

NITC/DRIC; (e) DIBC and CTC have the right to build the New Span to the Ambassador Bridge


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and any government action by defendants that seeks to favor the NITC/DRIC over the New Span

to prevent plaintiffs from exercising their right to build the New Span is a breach of plaintiffs’

franchise rights and an unlawful discrimination prohibited by the Equal Protection clause of the

Constitution; and (f) the Coast Guard has unlawfully, arbitrarily, and capriciously refused to

grant DIBC its navigational permit to build the New Span. In addition, plaintiffs seek injunctive

relief to protect the foregoing rights.

PARTIES

20. Plaintiff Detroit International Bridge Company (“DIBC”) is a corporation

incorporated under the laws of the State of Michigan, having its principal place of business at

12225 Stephens Road, Warren, Michigan 48089.

21. Plaintiff Canadian Transit Company (“CTC”) is a Canadian Special Act

corporation having its principal place of business at 4285 Industrial Drive, Windsor, Ontario,

N9C 3R9, Canada.

22. DIBC and CTC, respectively, own the United States and Canadian sides of the

Ambassador Bridge. They operate the Ambassador Bridge in cooperation with each other

pursuant to a joint operation agreement.

23. Plaintiff DIBC is the successor in interest to the American Transit Company

(“ATC”) and another company also known as Detroit International Bridge Company (“Old

DIBC”). ATC and CTC were the original grantees, in 1921, of the rights to build and operate a

toll bridge across the Detroit River, together with the associated toll-collection and other rights.

Pursuant to statutory authorization, ATC transferred all of its rights and assets to Old DIBC in

1927. Old DIBC merged into the present-day DIBC in 1979. This Complaint refers to plaintiff


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DIBC, and where applicable, its predecessors in interest ATC and Old DIBC, collectively as

“DIBC.” DIBC and CTC together are referred to as “plaintiffs.”

24. Plaintiff DIBC is a privately held company, which is owned, through another

company, by United States citizens.

25. Plaintiff CTC is, and has been since 1927, a wholly owned subsidiary of DIBC.

26. Defendant United States Department of State (“State Department”) is an agency

of the United States government with its principal offices located at 2201 C Street NW,

Washington, DC 20520.

27. Defendant John Kerry is the United States Secretary of State. Defendant Kerry is

sued in his official capacity. Defendant Kerry or his successor in office is the officer who would

be responsible for compliance with any judgment of this Court against the State Department in

this action.

28. Defendant Canada-United States-Ontario-Michigan Border Transportation

Partnership (“NITC/DRIC Partnership” or “Partnership”) is composed of representatives from

Transport Canada (“TC”), the FHWA, Ontario Ministry of Transport (“MTO”), and the

Michigan Department of Transportation (“MDOT”). The Partnership was created through a

framework agreement in 2001 and adopted a charter on February 2, 2005. The Partnership’s

charter states that the Partnership was “formed for the purpose of improving the safe and

efficient movement of people and goods across the U.S./Canadian border at the Detroit River,

including improved connections to national, provincial and regional systems such as I-75 and

Highway 401.”


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29. Defendant FHWA is an agency of the United States Department of

Transportation. FHWA is sued both in its own capacity and as one of the partners in the

Partnership.

30. Defendant Victor Mendez is the Administrator of FWHA. Defendant Raymond

H. LaHood is the United States Secretary of Transportation. Defendants Mendez and LaHood

are sued in their official capacities. Defendants Mendez and LaHood or their successors in office

are the officers who would be responsible for compliance with any judgment of this Court

against FHWA in this action. This Complaint refers to defendants FHWA, Mendez, and LaHood

collectively as the “FHWA defendants.”

31. Defendant the Government of Canada (“Canada” or “Government of Canada”), as

sued herein, should be understood to mean and include the Canadian federal government and

Crown, which is sometimes sued under the name “Her Majesty the Queen in Right of Canada.”

Canada is a foreign state.

32. Defendant the Windsor-Detroit Bridge Authority (the “Authority”) is an entity

created by an act of the Canadian Privy Council Office, PC Number 2012-1350, on October 9,

2012. The Privy Council action creating the Authority states that under the Crossing Agreement

entered into on June 15, 2012 by Canada and representatives of Michigan, “a crossing authority

is to be established by Canada pursuant to and subject to the laws of Canada.” Accordingly, the

Privy Council issued letters patent of incorporation “for the establishment of the Windsor-Detroit

Bridge Authority, a corporation without share capital, for the purpose of the corporation

constructing or operating an international bridge across the Detroit River between Windsor,

Ontario and Detroit, Michigan.” (The Windsor-Detroit Bridge Authority is at times referred to

as the “Crossing Authority,” including in the Crossing Agreement.) Thus, the Authority is a


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corporation that does not have shares owned by Canada or anyone else, created for the sole

purpose of constructing or operating the NITC/DRIC. The letters patent provide that “all

contracts, documents and instruments in writing so signed, including the Crossing Agreement,

shall be binding upon the Crossing Authority without any further authorization or formality” and

that the Authority “shall have the capacity, rights and powers of a natural person.”

33. Defendant United States Coast Guard (the “Coast Guard”) is an agency of the

United States Department of Homeland Security.

34. Defendant Admiral Robert J. Papp, Jr. is the Commandant of the Coast Guard and

the successor in office to Admiral Thad W. Allen, who was named as a defendant in the original

complaint in this action, and is substituted for Admiral Allen pursuant to Rule 25(d) of the

Federal Rules of Civil Procedure. Defendant Janet Napolitano is the United States Secretary of

Homeland Security. Defendants Papp and Napolitano are sued in their official capacities. This

Complaint refers to defendants the Coast Guard, Papp, and Napolitano as the “Coast Guard

defendants.” Defendants Papp and Napolitano or their successors in office are the officers who

would be responsible for compliance with any judgment of this Court against the Coast Guard in

this action.

35. The United States of America is also named as a defendant in this action.

36. The United States, the Secretary of State, the State Department, the FHWA

defendants, and the Coast Guard defendants together are referred to herein as the “U.S.

defendants.”

FOREIGN SOVEREIGN IMMUNITY

37. The Partnership is neither a foreign state nor an organ or instrumentality of a

foreign state, and therefore it is not immune under the Foreign Sovereign Immunities Act


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(“FSIA”). It is instead a partnership comprised equally of United States and Canadian entities

that is acting in violation of plaintiffs’ rights under United States statutes and the United States

Constitution, and therefore is subject to suit in United States courts. In addition, the Partnership

has engaged in the same commercial activity as the Government of Canada, as described below,

and therefore would not in any event be eligible for sovereign immunity.

38. The Windsor-Detroit Bridge Authority is not an agency, instrumentality, or organ

of Canada. Rather, it is a corporation created for the sole purpose of taking over the construction

and operation of the NITC/DRIC, which is a commercial endeavor. In any event, as alleged

below, even if the Authority is an agency, instrumentality, or organ of Canada, it is engaged in a

commercial activity and therefore is not immune under the FSIA.

39. As against defendant Canada, this action is based upon (a) a commercial activity

carried on in the United States by Canada, (b) an act performed in the United States in

connection with commercial activity of Canada within the territory of Canada, and (c) an act or

acts outside the territory of the United States in connection with a commercial activity of Canada

within the territory of Canada, causing a direct effect in the United States. For these reasons,

under 28 U.S.C. § 1605(a)(2), Canada is not immune from the jurisdiction of the Court. This

Third Amended Complaint challenges only those commercial actions by Canada taken in the

United States, or commercial activity taken elsewhere that has a direct effect in the United

States. It does not challenge any official conduct of Canada taken within Canada.

40. As plaintiffs’ construction and operation of the Ambassador Bridge demonstrate,

the construction, maintenance, and operation of a toll bridge like the NITC/DRIC is an activity

that private parties as well as governments can carry out. As a result, it constitutes commercial

activity within the meaning of 28 U.S.C. § 1605.


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41. In addition, acts taken toward the planning and construction of the NITC/DRIC

are themselves either commercial activities or acts taken in connection with the commercial

activity that is the planned NITC/DRIC.

42. Canada has engaged in extensive commercial activity in and affecting the United

States in connection with and preparation for the planned construction and operation of the

NITC/DRIC. For example, in an April 29, 2009 letter from Transport Canada Minister John

Baird to Michigan Governor Jennifer M. Granholm, Canada offered to “increase its financial

participation up to a maximum of US$550 million, for project components in Michigan . . . .”

The letter further stated that Canada “would expect repayment from the anticipated toll revenues

to be derived from the operation of the new bridge.” This offer to invest $550 million to fund

construction of the NITC/DRIC within the United States was conditioned on “the Michigan

Legislature adopting all of the authorizing legislation for the implementation of the DRIC Project

. . . .” Governor Granholm publicly announced the offer the same day she received the letter.

After making the initial $550 million offer in a letter, Minister Baird and Associate Assistant

Deputy Minister Helena Borges visited Lansing, Michigan on June 22, 2010 to promote the

NITC/DRIC and Canada’s investment proposal to the Michigan Senate Transportation

Committee. Months later, Minister Baird’s successor, Chuck Strahl, confirmed that the offer of a

$550 million investment remains available.

43. Canada’s commercial activity in the United States, and/or acts performed in the

United States in connection with the commercial activity in Canada, concerning the subject

matter of this action include each of the following:

(a) The planned construction and preparation for construction of the NITC/DRIC, approximately one-half of which will be within the territory of the United States;


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(b) The planned construction and preparation for construction of the NITC/DRIC’s U.S. plaza and the other associated structures wholly within the territory of the United States;

(c) Canada’s involvement as a shareholder and partner in the operation, direction, planning, and design of the U.S. portion of the NITC/DRIC;

(d) Meeting with U.S. officials and others and other preparatory activities that have taken place in the United States in connection with the planned constructions and operation of the NITC/DRIC, or in connection with the review of plaintiffs’ proposed New Span of the Ambassador Bridge, including an October 19, 2005 meeting in Detroit at which David Wake from the Ontario Ministry of Transportation, representatives from the U.S. Army Corps of Engineers and the Coast Guard, and possible other U.S. and Canadian officials formed an agreement that if Canada rejected the Ambassador Bridge New Span, the U.S. would drop it from consideration;

(e) The negotiation of a proposed $550 million investment to finance construction of U.S. highway approaches to the NITC/DRIC, as set forth in an April 2009 letter from minister John Baird to Governor Jennifer Granholm and elaborated upon in a meeting between Baird and Michigan officials;

(f) The hiring of lobbyists and consultants within the United States;

(g) The promotion of the NITC/DRIC and hindrance of the Ambassador Bridge New Span through publications in the United States and by sending Canadian officials to speak to the Michigan legislature, Congressional staffers, administrative agency officials, and the public within the United States;

(h) The execution of the Crossing Agreement with the Governor of Michigan, MDOT, and MSF, to further implement the plans referenced above for the construction of the NITC/DRIC, including the promise of Canadian financing for the construction of the U.S. portion of the NITC/DRIC; and

(i) The issuance of letters patent for the incorporation of the Windsor-Detroit Bridge Authority to carry out the plans articulated in the Crossing Agreement for the construction of the NITC/DRIC, including its U.S. portions.

44. In addition, Canada’s acts within Canada, in connection with the commercial

activity in Canada of constructing and operating or preparing to construct and operate the

NITC/DRIC, have direct effects in the United States. The direct effects include, among others,

each of the following:


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(a) Constructing and undertaking preparatory work to construct the proposed NITC/DRIC, half of which will be in the United States and which, according to the FHWA, will impact traffic patterns throughout the United States;

(b) Depressing the value to plaintiffs of the Ambassador Bridge as a whole, which is partly in the United States and partly in Canada, by interfering with plaintiffs’ rights arising under treaty, statute, and contract;

(c) Causing FHWA, the Michigan legislature, and others in the United States to make particular decisions relating to the construction, financing, and siting of the proposed NITC/DRIC, or relating to the proposed New Span of the Ambassador Bridge;

(d) A proposed $550 million investment to finance the construction of approach roads to the proposed NITC/DRIC inside the United States, conditioned on a favorable vote by the Michigan legislature on legislation to approve the NITC/DRIC;

(e) Facilitating the construction of the approach roads to the proposed NITC/DRIC inside the United States; and

(f) Breaching plaintiffs’ rights under a 1990 settlement agreement between plaintiffs and Canada (described in more detail below) settling U.S. litigation brought to resolve a dispute over the ownership of the Ambassador Bridge and the judgment entered in that U.S. litigation.

45. The claims pleaded herein are based on these and other commercial activities and

acts in connection with commercial activities, as further alleged below in this ThirdAmended

Complaint.

46. Further, through its activities in the United States set forth in this Third Amended

Complaint, Canada has waived sovereign immunity under 28 U.S.C. § 1605(a)(1).

JURISDICTION

47. As set forth above, Canada is not immune from the jurisdiction of this Court.

48. As against Canada, this is a nonjury civil action against a foreign state with

respect to which the foreign state is not entitled to immunity, and therefore this Court has

jurisdiction over the subject matter of the claims against Canada under 28 U.S.C. § 1330(a).


20

49. Because this Court has jurisdiction of the subject matter and because Canada has

accepted service of process under 28 U.S.C. § 1605(a)(1), the Court has jurisdiction over the

person of defendant Canada under 28 U.S.C. § 1330(b).

50. As against the U.S. defendants, this is an action for nonmonetary relief against

officers and agencies of the United States, in addition to an action by persons suffering legal

wrong or aggrieved or adversely affected because of agency action, and based on the action or

failure to act of an agency, officer, or employee of the United States in an official capacity or

under color of legal authority. For these reasons, under 5 U.S.C § 702, the U.S. defendants are

not immune from the jurisdiction of this Court.

51. The claims against the U.S. defendants arise under the Constitution, laws, and

treaties of the United States and seek to compel the U.S. defendants to comply with their legal

duties. This Court has jurisdiction over the subject matter of those claims under 28 U.S.C. §§

1331 and 1361.

VENUE

52. Defendant Canada is a foreign state. Venue is therefore proper in this District

under 28 U.S.C. § 1391(f)(4) as to the claims against Canada.

53. As federal agencies, the State Department, FHWA, and Coast Guard are deemed

to reside in the District of Columbia. Defendants Kerry, Mendez, LaHood, Papp, and Napolitano

perform their official duties in the District of Columbia and are therefore deemed to reside in the

District when sued in their official capacities. Venue is therefore proper in the District under 28

U.S.C. § 1391(e)(2) as to the claims against the U.S. defendants.

54. In addition, a substantial part of the events or omissions giving rise to the claims

occurred in the District of Columbia. Venue is therefore proper in the District against the U.S.


21

defendants under 28 U.S.C. § 1391(e)(1) and against Canada under 28 U.S.C. § 1391(f)(1).

Venue is also appropriate against Canada under 28 U.S.S. §1391(f)(4).

FACTUAL BACKGROUND

A. Plaintiffs’ Rights Under The Special Agreement Created By Reciprocal U.S. And Canadian Legislation.

(1) Enactment Of U.S. And Canadian Legislation Constituting A Special Agreement Under Article XIII Of The 1909 Boundary Waters Treaty.

55. In 1909, the United States and the United Kingdom of Great Britain and Ireland,

which at the time was responsible for Canada’s foreign affairs, signed and ratified a treaty

regulating, among other things, the construction of bridges and other impediments to navigation

across the waters separating the United States and Canada. Treaty Relating to Boundary

between the United States and Canada, U.S.-U.K., Jane. 11, 1909, 36 Stat. 2448 (the “Boundary

Waters Treaty”).

56. The Boundary Waters Treaty prohibits the construction of new bridges over the

boundary waters between the United States and Canada, other than as specified in the treaty.

One of the ways the treaty authorizes the construction of new bridges is pursuant to a “special

agreement” authorizing construction of bridges and other uses, obstructions, or diversions of the

boundary waters between the United State and Canada. Id. Art. III. The Boundary Waters

Treaty further specifies that “concurrent or reciprocal” legislation by the United States Congress

and the Canadian Parliament would constitute such a “special agreement.” Id. Art. XIII. The

Boundary Waters Treaty provided that any new uses, obstructions, or diversions of boundary

waters would require the approval of an International Joint Commission, except where

authorized by a “special agreement.” Id. Art. III.

57. In 1921, the Canadian Parliament and the U.S. Congress adopted such a special

agreement in the manner contemplated by the Boundary Waters Treaty. They did so by passing


22

reciprocal legislation granting to CTC and DIBC, respectively, a perpetual right to construct,

operate, and collect tolls on an international bridge between Detroit, Michigan and Sandwich

(now part of Windsor), Ontario, among other rights. Act of Mar. 4, 1921, 66th Cong., ch. 167, 41

Stat. 1439 (“1921 DIBC Act,” and, with subsequent U.S. legislation (the 1925 DIBC

Amendment and 1926 DIBC Amendment cited below), the “U.S. Act”); Act of May 3, 1921, 11-

12 Geo. V Ch. 57 (Can.) (“1921 CTC Act,” and, with subsequent Canadian legislation (the 1927

CTC Amendment cited below), the “Canadian Act”).

58. The effectiveness of the U.S. Act was expressly conditioned on the passage of

reciprocal legislation by Canada, and the effectiveness of the Canadian Act was expressly

conditioned on the passage of reciprocal legislation by the U.S. Congress.

59. From 1922 to 1927, both the U.S. and Canada amended the Acts to expand and

clarify plaintiffs’ rights. See Act of June 28, 1922, 12-13 Geo. V. ch. 56 (Can.) (“1922 CTC

Amendment”); Act of April 17, 1924 68th Cong., ch. 125 43 Stat. 103 (“1924 DIBC

Amendment): Act of Mar. 3, 1925, 69th Cong. 448, 43 Stat. 1128 (“1925 DIBC Amendment”);

Act. Of May 13, 1926, 69th Cong. ch. 292, 44 Stat. 535 (“1926 DIBC Amendment”); Act of Mar.

31, 1927, 17 Geo. V. ch. 81 (Can.) (“1927 CTC Amendment”).

60. In an April 1927 letter, the U.S. Department of State advised DIBC that the U.S.

Act and Canadian Act constituted “a special agreement of the kind defined by Article 13 of the

Boundary Waters Treaty of 1909 between the United States and Great Britain, authorizing

construction of the bridge . . . . and that in view of such special agreement, under Article 3 of the

Treaty the matter of the construction of the bridge will not require the approval of the

International Joint Commission.”


23

61. In a July 1927 letter to CTC’s Canadian attorneys, the Department of External

Affairs in Canada similarly advised that no approval of the International Joint Commission was

required under the Boundary Waters Treaty.

62. As an agreement between nations, consented to in the manner specified in the

previously ratified Boundary Waters Treaty, the special agreement formed by the U.S. Act and

Canadian Act (the “Special Agreement”) itself constitutes a binding international agreement.

This international agreement constitutes a treaty under international law. The agreement has

been incorporated into U.S. and Canadian domestic law by virtue of the U.S. Act and the

Canadian Act.

63. The original 1921 CTC Act stated that CTC had “the powers, rights and privileges

of a railway company” and that it “may purchase, lease or otherwise acquire and hold lands for

the bridge, tracks, terminal yards, accommodation works and facilities” as well as “expropriate

and take an easement in, over, under or through any lands without the necessity of acquiring a

title in fee simple thereto.” The later amendments to that Act provided that CTC had the power

“to construct, maintain and operate a railway and general traffic bridge across the Detroit River

[that] may be exercised by the Company in the construction, maintenance and operation of a

bridge for both railway traffic and general traffic purposes” and that CTC was subject to “the

provisions of The Railway Act, 1919.” As a result, among other rights, CTC has condemnation

powers.

64. In addition, the Appendix to the Bridge Act of 1906, under which the Ambassador

Bridge was built, states that “any bridge built in accordance with the provisions of this Act shall

be a lawful structure and shall be recognized and known as a post route . . . .”


24

(2) Plaintiffs’ Franchise And Contract To Build, Operate, And Maintain The Ambassador Bridge Between The United States And Canada In Exchange For Perpetual Rights Under The Special Agreement.

65. To induce plaintiffs to undertake the risk and expense of constructing and

operating the bridge, the United States and Canada passed the legislation constituting the Special

Agreement, which granted plaintiffs a perpetual and exclusive right of franchise to build,

operate, maintain, and collect tolls on a bridge across the Detroit River, subject to the conditions

specified in the Special Agreement.

66. Plaintiffs’ rights under the U.S. Act and the Canadian Act were conditioned on

the commencement and completion of construction of the bridge by certain deadlines. See 1921

DIBC Act § 2; 1921 CTC Act § 17. These deadlines were subsequently extended. 1924 DIBC

Amendment § 1; 1925 DIBC Amendment § 1; 1926 DIBC Amendment § 1; 1927 CTC

Amendment § 2.

67. At the time of the Special Agreement, building a bridge span long enough to cross

the river between Detroit and Windsor was an extraordinary technical feat, and it was uncertain

whether it could even be accomplished. For a time after its construction, the Ambassador Bridge

was the longest suspension bridge in the world. Both Canada and the United States recognized

that a bridge crossing between Detroit and what is now Windsor would help the economy of the

region, and that inducing a private party to undertake the expense and risk of building such a

bridge would be for the benefit of the public in both countries. The Canadian Act expressly

declared “[t]he works and undertaking of [CTC] . . . . to be for the general advantage of Canada.”

1921 CTC Act 2.

68. In reliance on the perpetual rights granted to it and to its wholly owned subsidiary

CTC by the Special Agreement, and having obtained all approvals required by the U.S. Act and


25

the Canadian Act, DIBC raised money by selling bonds, acquired the necessary land, and

constructed the Ambassador Bridge and its accompanying facilities.

69. DIBC and CTC would not have undertaken to build the Ambassador Bridge if

they had believed that their franchise rights were not exclusive, i.e., that other entities would be

permitted to build bridges in the vicinity of the Ambassador Bridge.

70. The United States, not DIBC and CTC, chose the location for the Ambassador

Bridge. Thus, the current location of the Ambassador Bridge was chosen pursuant to a directive

from the United States, and the United States never subsequently told DIBC or CTC to build

their bridge at a different location, to move their bridge, or to build any expansion of their bridge,

such as the New Span, at a different location. To the contrary, as shown below, the United States

Congress has appropriated funds to protect the construction of the Ambassador Bridge New

Span at the same location as the current Ambassador Bridge. The United States Congress has

never supported the construction of a new bridge between Detroit and Windsor at a location

other than the location of the Ambassador Bridge and its New Span.

71. The Ambassador Bridge first opened for traffic on November 11, 1929. As the

Michigan Supreme Court explained in 1930, the Ambassador Bridge and its approaches formed

“a union of highways of Michigan and Ontario and convert[ed] them into one uninterrupted

public road.”

72. The Special Agreement, and each of the U.S. Act and the Canadian Act that make

up the Special Agreement, constituted both a statutory right and a contractual offer to plaintiffs.

The construction and opening of the Ambassador Bridge constituted acceptance of that

contractual offer through performance. This offer and acceptance formed a binding contract


26

among all four of the United States, Canada, DIBC, and CTC, in addition to the statutory

franchise right.

73. As a result of the Special Agreement and plaintiffs’ acceptance of the offer

contained therein, plaintiffs acquired certain statutory, contractual, treaty, and property rights,

including the perpetual right to own, operate, maintain, and charge tolls on the Ambassador

Bridge, subject only to the requirements set forth in the Special Agreement and the other

legislation made applicable by the Special Agreement.

(3) Plaintiffs’ Property Rights In The Ambassador Bridge And The Associated Franchises.

74. Over the years, DIBC has invested hundreds of millions of dollars into building,

maintaining, operating, and upgrading the Ambassador Bridge, in reliance on the exclusive

statutory and contractual franchise rights that the United States and Canada granted plaintiffs

under the Special Agreement.

75. The tangible value of the physical bridge facility (including the bridge span and

associated buildings and plazas) is only a small part of the value of plaintiffs’ rights under the

Special Agreement. The principal value in plaintiffs’ rights under the Special Agreement comes

from the right to collect tolls from vehicles.

76. DIBC has a property interest in the franchise granted by the U.S. Act, which

specifically conferred rights and benefits upon ATC by name, DIBC’s predecessor in interest,

and specifically authorized ATC to transfer those rights to a successor.

77. CTC has a property interest in the franchise granted to CTC by the Canadian Act,

which chartered CTC and specifically conferred rights and benefits upon CTC by name.

78. The plaintiffs collectively have a property interest in the joint franchise

established by the Special Agreement formed by the U.S. Act and the Canadian Act.


27

(4) The Exclusivity Of Plaintiffs’ Franchise.

79. Under Canadian law, it is well settled that a franchise is exclusive by nature.

Unless stated otherwise in the enacting legislation, a toll bridge franchise grants the franchisee an

exclusive right to operate its facilities and collect tolls or fares and to exclude competition as

long as the bridge remains useful.

80. Because the Canadian Act does not state that CTC’s franchise is nonexclusive, the

Canadian Act granted CTC an exclusive franchise as a matter of law.

81. Exclusivity of a toll bridge franchise is breached under Canadian law if a

competing bridge diverts traffic from the franchisee. Thus, any new bridge must be placed at

sufficient distance from the franchisee’s bridge to avoid competition that would be injurious to

the franchise. This principle of law recognizes the fact that a franchisee has not only rights but

also duties, including the duty to maintain the bridge, and the fact that building another bridge in

the immediate vicinity would leave the franchisee saddled with its duties but deprive it of rights

granted in consideration of those duties.

82. The property right created by CTC’s exclusive franchise under the Canadian Act

is entitled to recognition under United States law. The U.S. defendants as well as Canada are

required to respect CTC’s property to the same extent as any other property acquired in a foreign

country.

83. Moreover, the U.S. Act and Canadian Act do not operate independently but are

reciprocal. They function as a single Special Agreement and treaty, granting a franchise to

DIBC and CTC together. The Ambassador Bridge must be, and is, operated as a single crossing.

84. It follows that the exclusivity of CTC’s franchise under the Canadian Act

necessarily requires that DIBC’s franchise under the U.S. Act and plaintiffs’ common franchise


28

under the Special Agreement must also be exclusive, both as a matter of law and as a matter of

practicality, for several reasons.

85. First, as a matter of law, the U.S. Act states that it is meant to operate in tandem

with the Canadian Act, which grants exclusivity as discussed. Article XIII of the Boundary

Waters Treaty also establishes that the two acts operate together as a Special Agreement.

Nothing in the U.S. Act negates, on the U.S. side, the exclusivity that arises by reason of the

Canadian Act.

86. Second, also as a matter of law, DIBC accepted its franchise under the U.S. Act in

reliance on the reciprocal franchise of CTC, its wholly owned subsidiary, under the Canadian

Act. Thus, DIBC has a contractual right to the maintenance of CTC’s exclusivity.

87. Finally, as a matter of practicality, a bridge that only goes to the middle of the

Detroit River and stops there is not a functioning crossing. Any bridge on the Detroit River that

competes with the Ambassador Bridge must necessarily land on both the U.S. and Canadian

sides of the river. Thus, any injurious competition with DIBC’s franchise necessarily constitutes

injurious competition with CTC’s franchise and vice versa. For this reason, CTC’s legal right to

exclusivity on the Canadian side of the river must also grant exclusivity on the U.S. side of the

river.

88. Further, the perpetual term granted to DIBC by the United States Congress would

be impliedly and therefore improperly repealed if the government itself built a bridge across the

Detroit River between Detroit and Windsor that would divert a material portion of the toll

revenues otherwise enjoyed by DIBC as DIBC’s benefit of the bargain with Congress under its

franchise.


29

(5) Plaintiffs’ Private Rights Of Action To Enforce Their Property, Contract, Statutory, And Treaty Rights.

89. DIBC has a right to enforce and protect its statutory rights arising directly under

the U.S. Act – a statute that expressly confers rights solely upon DIBC’s predecessor in interest.

Likewise, CTC has a right to enforce and protect its statutory rights arising directly under the

Canadian Act – a statute that expressly confers rights solely upon CTC. Plaintiffs therefore

have a private right of action arising directly under the Special Agreement formed by the U.S.

and Canadian Acts. The U.S. Act and Canadian Act, and the Special Agreement formed thereby,

explicitly create private rights specific to either or both of DIBC and CTC, including the

authority to “construct, maintain, and operate” a bridge across the Detroit River. See 1921 DIBC

Act, § 1; 1921 CTC Act § 8(a). Indeed, at the time the Acts were adopted, it was already well

settled that the creation of a franchise implies a right to sue to enforce the franchise.

90. Further, as a matter of common law in both the U.S. and Canada, the owner of

any property right has a cause of action to protect the property right from those who invade it.

The cause of action exists whether the property right arises at common law or is created by

statute or otherwise.

91. More particularly, as a matter of common law in both the United States and

Canada, the owner of any franchise to operate a bridge, ferry, or other crossing has a right of

action against any competitor, regulator, or other person or entity that invades the owner’s rights

under the franchise.

92. Thus, plaintiffs have a common-law right of action to enforce against the

defendants their property rights created by the U.S. Act, the Canadian Act, and the Special

Agreement formed by those two Acts.


30

93. In addition, plaintiffs have a common-law right of action to enforce their

contractual rights arising by reason of the contract formed by their acceptance of the offer

embodied in the U.S. Act, the Canadian Act, and the Special Agreement.

B. The Decades-Long Effort By Canada To Appropriate The Ambassador Bridge.

94. Despite its initial enthusiasm in the 1920s for attracting a private owner to build,

operate, and collect tolls on the Ambassador Bridge, Canada in the 1970s became hostile to the

idea that a private, American-owned company had a perpetual and exclusive right to operate the

most important trade corridor between Canada and the United States, and recognized that

ownership by Canada of the bridge or its Canadian half would provide a source of toll revenue

for Canada.

95. Canada has recognized that it lacks the authority simply to take the toll bridge

franchise rights from plaintiffs directly without compensation. Canada also has not attempted, to

date, to take CTC’s rights through the Canadian equivalent of eminent domain. Instead, officials

of the Government of Canada and its provincial and local governments have periodically taken

actions designed to depress the value of plaintiffs’ rights to coerce plaintiffs into surrendering

their rights to Canada on unfair terms.

96. By a settlement agreement entered into in 1990, as detailed below, Canada agreed

to cease interfering with plaintiffs’ continued ownership and operation of the Ambassador

Bridge. More recently, however, Canada has resumed its interference with plaintiffs’ rights.

(1) The Sharp Policy, The Amended Sharp Policy, And FIRA.

97. The Common Stock of DIBC, a Michigan corporation, was publicly traded on the

over-the-counter market beginning in 1939 after DIBC underwent a bankruptcy reorganization.

From 1939 to 1973, Canada made no attempts to interfere with purchases or sales of DIBC stock.


31

98. Canada’s first concerted efforts to interfere with plaintiffs’ rights took place

beginning in 1973, immediately after Central Cartage Co., a company owned by the current

owners of DIBC, advised Canada by letter that it was interested in acquiring ownership of DIBC.

99. In response to Central Cartage’s letter, Canada issued a document titled Statement

by the Secretary of State for External Affairs, the Honourable Mitchell Sharp, on the

Government’s Policy on International Bridges with Particular Reference to the Ambassador

Bridge. This policy statement (the “Sharp Policy”) stated that the Canadian government “would

expect” any “change in the status of the CTC,” or any mortgaging of the Canadian portion of the

bridge, to meet certain conditions, including, among others: (a) a reduction of tolls; (b) a

requirement that the Canadian portion of the bridge would be conveyed without cost to Canadian

or Ontario governmental authorities within 25 years after acquisition; and (c) immediate

conveyance, without cost, of land not required for the operation of the bridge to a body

designated by the Canadian government.

100. In 1974, Canada enacted Part I of the Foreign Investment Review Act (“FIRA”),

which demanded that acquisition of control of a Canadian business or establishment could

proceed only if the Government of Canada had determined that such acquisition were of

“significant benefit to Canada.” DIBC is not a Canadian corporation, but its wholly owned

subsidiary CTC is a Canadian corporation. FIRA was a protectionist enactment designed to

discourage foreign ownership by adopting discriminatory policies and to place Canadians in

control of foreign investments on Canadian soil.

101. In 1977, Canada revised the Sharp Policy to make it even more draconian. The

revised policy, titled Policy on International Bridges (the “Amended Sharp Policy”), purported

to require that the Canadian portion of the Ambassador Bridge be conveyed without cost to


32

Canadian or Ontario governmental authorities immediately upon any change in status of CTC,

such as an acquisition of control of its parent company DIBC, subject to a 25-year lease-back.

102. FIRA, the Sharp Policy, and the Amended Sharp Policy were directly contrary to

plaintiffs’ rights under the Special Agreement formed by the U.S. Act and the Canadian Act.

103. Among other things, the Canadian Act granted CTC the right to unite with any

Canadian, Michigan, or other U.S. company in building, working, managing, maintaining, and

using the bridge and its terminals and approaches; to convey or lease to such company all or part

of its interest in the bridge; and to mortgage, pledge, or hypothecate all its assets, alone or in

conjunction with such other company. 1921 CTC Act § 14; 1922 CTC Amendment § 4. The

assets of CTC referenced in the Canadian Act include CTC’s rights in the bridge and all other

rights and franchises granted to CTC under the Canadian Act.

104. Similarly, the U.S. Act granted DIBC the right to sell, assign, transfer, or

mortgage all its assets. See 1926 DIBC Amendment § 3. The assets of DIBC referenced in the

U.S. Act include DIBC’s rights in the bridge and all other rights and franchises granted to DIBC

under the U.S. Act.

105. The Sharp Policy, the Amended Sharp Policy, and the application of FIRA to

CTC were all intended to defeat the acquisition of ownership and control of DIBC by Central

Cartage, even though Canada, Central Cartage, or anyone else could have acquired control of

DIBC simply by purchasing a sufficient number of shares of stock publicly traded on the over-

the-counter market. Only 0.8% of DIBC stock was owned by Canadians in 1979, following 50

years of the opportunity for anyone, including the Canadian government, to purchase the

publicly traded shares.


33

(2) The FIRA Litigation.

106. In 1979, Central Cartage acquired a controlling interest in the stock of DIBC by a

combination of market purchases and a purchase from an unrelated American investor. Central

Cartage proposed a “going-private” transaction, whereby it would pay the minority shareholders

for their shares and return the publicly-traded DIBC to being a privately held company, as it had

been prior to its bankruptcy in the 1930s. This transaction received approval from the United

States Securities and Exchange Commission (“SEC”) and the requisite vote of the shareholders.

To comply with the requirements that Canada had purported to impose under FIRA, Central

Cartage’s acquisition of DIBC had been structured so that DIBC would transfer ownership of

CTC to an unrelated third-party Canadian owner.

107. The Government of Canada nonetheless immediately brought suit in Canada

seeking to block this transaction, claiming that Central Cartage’s acquisition of DIBC, which

owned CTC prior to giving effect to the planned transfer of CTC to an unrelated investor,

violated FIRA by not being “of significant benefit” to Canada. Canada obtained a preliminary

injunction from the Federal Court of Canada that made it impossible to carry out the transaction

within Canada but disclaimed any extraterritorial effect that would block the underlying

acquisition of DIBC in the United States.

108. The acquisition of DIBC by Central Cartage thus proceeded in accordance with

Central Cartage’s filings with the SEC, but the Canadian injunction prevented DIBC from

transferring its stock in CTC to the unrelated third-party Canadian investor as contemplated by

Central Cartage’s plan for acquiring DIBC. As a result, DIBC became wholly owned by Central

Cartage, and CTC remained wholly owned by DIBC.

109. In 1980, Central Cartage and DIBC sued Canada and a number of Canadian

officials in United States District Court, asserting that Canada’s attempts to enforce FIRA against


34

them constituted an expropriation, breach of contract, and other violations of law. Litigation

raged for more than a decade.

(3) The 1990 Settlement Agreement.

110. Canada, Central Cartage, DIBC, and CTC entered into a settlement agreement in

1990, which settled the FIRA litigation.

111. The 1990 settlement agreement was signed shortly before Canada’s entry into the

North American Free Trade Agreement (“NAFTA”), which would prohibit discrimination by

Canada against the U.S. investors.

112. The 1990 settlement agreement provided that both the Canadian and U.S.

litigation would be dismissed with prejudice. The Canadian litigation was dismissed on

December 23, 1991, with prejudice, pursuant to the 1990 settlement agreement. The U.S.

litigation was dismissed on April 6, 1992, with prejudice, pursuant to the 1990 settlement

agreement.

113. The result of the dismissal with prejudice of the Canadian litigation was that

Canada permitted the change of control of DIBC and the continued ownership of CTC by DIBC,

without the need to comply with the conditions that Canada had previously demanded in the

Sharp Policy, the Amended Sharp Policy, or FIRA.

114. This dismissal reflected the Canadian government’s acceptance that the operation

and ownership issues raised by the litigation were settled and that DIBC’s continued ownership

of CTC and the Ambassador Bridge was of significant benefit to Canada.

115. The dismissal with prejudice of the U.S. litigation reflected Canada’s

acknowledgement that it could not apply FIRA, the Sharp Policy, or the Amended Sharp Policy

to the Ambassador Bridge. The acknowledgement that these measures would not apply to


35

plaintiffs removed the basis for DIBC’s claims for expropriation and breach of contract as

alleged in the U.S. litigation.

(4) The 1992 Facilities Agreement.

116. By a subsequent 1992 facilities agreement that was contemplated by the 1990

settlement agreement, CTC and Canada agreed to cooperate with regard to customs facilities and

other construction projects in connection with the Ambassador Bridge for at least five years. The

1992 facilities agreement recited that “Canada and CTC each desire to make the CTC facilities at

Windsor, Ontario a model border crossing facility between Canada and the United States.”

117. The 1992 facilities agreement between CTC and Canada was not the settlement of

the FRIA litigation and did not supersede the 1990 settlement agreement. The Canadian

litigation had been dismissed pursuant to the 1990 settlement agreement before the 1992

facilities agreement was entered into. Indeed, unlike the FIRA litigation and the 1990 settlement

agreement, the 1992 facilities agreement did not even include DIBC and Central Cartage as

parties.

118. The 1990 settlement agreement and the 1992 facilities agreement ushered in a

period of cooperation between Canada and plaintiffs with respect to the Ambassador Bridge.

More recently, however, Canada has renewed its efforts to deprive plaintiffs of their rights, as

discussed below.

(5) The International Bridges And Tunnels Act, 2007.

119. In 2007, Canada enacted the International Bridges and Tunnels Act, S.C. 2007,

ch. 1 (the “IBTA”).

120. The IBTA states that its provisions should “prevail” in the event of “any

inconsistency or conflict” between the IBTA and other statutes, including the 1921 CTC Act,

which forms part of the Special Agreement. See IBTA § 4 & Schedule item 34.


36

121. The United States Congress has not consented to abrogation of any part of the

Special Agreement, and has never enacted any legislation that is either concurrent or reciprocal

to the IBTA. Thus, the IBTA is not part of any special agreement that can authorize the

construction of a bridge in a manner that is consistent with the Boundary Waters Treaty.

122. In 2009, Canada adopted the International Bridges and Tunnels Regulations, P.C.

2009-117, which listed the Ambassador Bridge in a schedule of bridges and tunnels subject to

the IBTA.

123. Canada has taken the position that the IBTA applies to the Ambassador Bridge.

124. In November 2009, Canada filed an application in Ontario Superior Court seeking

a declaration that the 1990 agreement settling the FIRA litigation and the subsequent 1992

facilities agreement did not bar the application of the IBTA to the Ambassador Bridge.

125. Among other things, the IBTA, like the Sharp Policy and Amended Sharp Policy

adopted in the 1970s, purports to give the Canadian government authority to set tolls on privately

owned international bridges. The IBTA establishes new requirements for approval for

alterations of existing bridges, even if proposals were submitted to departments and agencies

before the passage of the IBTA. If alteration occurs without such approval, the owner may be

ordered to “remove and destroy the bridge” or to forfeit ownership to Canada.

126. The IBTA, like the former FIRA, also purports to limit the change of ownership

over international bridges, requiring government approval to purchase, operate, or acquire

control of an entity that owns and operates an international bridge.

127. In each of these respects, the IBTA, if applicable, would have extraterritorial

effects in the United States by interfering with DIBC’s commercial ownership and operation of


37

the U.S. portion of the bridge, which necessarily operates in conjunction with CTC’s Canadian

portion of the bridge.

128. In effect, by enacting the IBTA and seeking to apply it to the Ambassador Bridge

in the United States, Canada is attempting to resurrect FIRA, the Sharp Policy, and the Amended

Sharp Policy, so as to appropriate DIBC’s commercial property rights, contrary to international

law and Canada’s settlement of the FIRA litigation of 1990.

129. Canada has enacted the IBTA to interfere with the Ambassador Bridge’s

expansion plans including the Ambassador Bridge New Span, to interfere with plaintiffs’ rights

to operate the bridge under the Special Agreement, and to promote Canada’s long-term goal of

limiting the value of plaintiffs’ rights in order to coerce plaintiffs to transfer their rights in the

Ambassador Bridge only to Canada on Canada’s terms.

130. An October 2005 Transport Canada briefing paper discussing the NITC/DRIC

admitted that a principal purpose of the IBTA was to thwart the proposed Ambassador Bridge

New Span. That briefing paper, regarding proposed legislation containing an earlier version of

the IBTA, stated that an “extremely urgent consideration, given the anticipated reaction of the

private sector proponents for a new crossing (Ambassador Bridge and DRTP [another proposed

private bridge at the time]), is the need to get [the bill] passed as soon as possible. [Transport

Canada] urgently needs the legal authority to turn down these or any other proposals if attempts

are made to have them reconsidered.”

C. The United States Congress And The State Department Have Recognized Plaintiffs’ Right To Build The Proposed Ambassador Bridge New Span.

(1) The Ambassador Bridge Gateway Project.

131. The Ambassador Bridge predated modern limited access highways. By the

1990s, additional road construction (the “Ambassador Bridge Gateway Project”) was needed to


38

provide a direct freeway connection from the bridge to major highways in the United States and

Canada.

132. In 1995, the United States Congress designated the Ambassador Bridge as part of

the national highway system. Commencing in 1998, Congress authorized and appropriated more

than $230 million for the U.S. part of the Ambassador Bridge Gateway Project, which was a

highway expansion to connect the Ambassador Bridge directly to the Interstate Highway and

State Highway Systems in Michigan. The U.S. part of the Ambassador Bridge now has direct

highway connections to I-75 and I-96, two of the three main interstates, and an indirect

connection to the third main interstate, I-94.

133. Canada and its provincial and local governments initially expressed support for

the Ambassador Bridge Gateway Project. In January 1999, the government of the Province of

Ontario and several Canadian municipalities, including the Cities of Windsor and Sarnia, took a

position in support of the projects submitted by the Michigan Department of Transportation to

the United States government under the Transportation Equity Act for the 21st Century, Pub. L.

105-178, 112 Stat. 107. These projects included the Ambassador Bridge Gateway Project.

134. On September 25, 2002, the Canadian government and the Ontario government

signed a memorandum of understanding jointly committing up to C$300 million to improve

access to the existing border crossings between Windsor and Detroit. Within a year, as described

in a March 12, 2004 report of the Canadian government’s Business Transportation Task Force,

the Canadian government and Ontario government had proposed a plan that would include “a

new truck-only parkway linking Highway 401 with the EC Row Expressway, the expansion of

the EC Row Expressway and improvements to Highway 3 / Huron Church Road [that is, the

Ambassador Bridge access road in Canada].” The purpose of this proposal was to improve


39

highway connections to the Ambassador Bridge on the Canadian side and create an end-to-end

solution linking the U.S. Interstate Highway System to major Canadian highways across the

Ambassador Bridge.

135. In reliance on the promise of improved road connections to support the continued

use and expansion of the Ambassador Bridge, plaintiffs have invested hundreds of millions of

dollars into improvements to the Ambassador Bridge designed to take advantage of the

Ambassador Bridge Gateway Project, including improvements to water, sewer, power

generation, and lighting systems; expanded customs inspection facilities; and road connections

on the Ambassador Bridge property.

136. Canada, however, has reneged on its commitment to support the Ambassador

Bridge Gateway Project. On the Canadian side, unlike the U.S. side, it is still necessary to travel

over a local road with multiple traffic lights, known as Huron Church Road, to reach the freeway

system from the Ambassador Bridge.

(2) Plans For The Ambassador Bridge New Span.

137. The aging of the Ambassador Bridge, which is now in its 82nd year, has made it

desirable to “twin” the bridge by building a second span (previously defined as the “Ambassador

Bridge New Span” or “New Span”) directly alongside the original span to ensure the continued

operation of the bridge.

138. A new bridge span is not necessary, as the existing Ambassador Bridge span

could be maintained in place and has sufficient capacity to meet all present and anticipated

traffic needs. However, as experience with other bridges has shown, it would be economically

more efficient to build a new span to allow maintenance of the aging structure of the old span.

139. The reciprocal legislation constituting the Special Agreement granted plaintiffs

the right to “construct, maintain, and operate” a bridge and approaches thereto across the Detroit


40

River. See 1921 DIBC Act, § 1; 1921 CTC Act, § 8(a). The Special Agreement’s provision of a

perpetual and exclusive right to construct and maintain a bridge across the Detroit River

necessarily includes the right to build a replacement or additional span as needed or appropriate.

140. The United States has explicitly acknowledged this right multiple times.

141. First, the United States Congress has never granted an entity other than DIBC

statutory or contractual franchise rights to build an international bridge between Detroit and

Windsor.

142. Second, in 1972, when Congress enacted the International Bridge Act (“IBA”), 33

U.S.C. §§ 535-535i, it recognized that the new legislation “should not be construed to adversely

affect the rights of those operating bridges previously authorized by Congress to repair, replace

or enlarge existing bridges.” H.R. Rep. No. 92-1303.

143. Third, in explaining its 2003 legislation appropriating funds for the Ambassador

Bridge Gateway Project, Congress stated that the funds were intended in part to “protect plans

identified by the Ambassador Bridge, including a second span of the Ambassador Bridge.”

Thus, the United States Congress confirmed that any new bridge crossing between Detroit and

Windsor should be at the location of the Ambassador Bridge, which the United States had

previously selected as the preferred location for any bridge crossing between Detroit and

Windsor.

144. Fourth, in an August 3, 2005 letter, the State Department acknowledged that “the

replacement or expansion of existing bridges authorized by Congress prior to passage of the

1972 International Bridge Act did not require a Presidential permit” and that because “DIBC is

only seeking to expand (or twin) the operation of the bridge . . . DIBC does not require a

Presidential permit.” In other words, because the New Span was already authorized by a


41

preexisting Act of Congress, DIBC’s existing franchise includes the right to build the

Ambassador Bridge New Span without seeking a Presidential permit from the State Department.

145. In addition to this authorization inherent in plaintiffs’ franchise under the Special

Agreement, the Ambassador Bridge Gateway Project, as authorized by Congress, was

specifically designed to facilitate plaintiffs’ plans to construct a New Span of the Ambassador

Bridge. Both a Memorandum of Understanding between DIBC and the Michigan Department of

Transportation (“MDOT”) signed in 1996 and the Ambassador Bridge Gateway Project

Agreement between DIBC and MDOT dated April 23, 2004 explicitly acknowledge that one of

the goals of the project was to “[a]ccommodate a potential future second span of the

[Ambassador] BRIDGE . . . .” Later briefing papers prepared by FHWA in 2006 confirmed that

the Ambassador Bridge Gateway Project was “designed to accommodate the second span, if

built.” About this same time, James Steele, an FHWA official with responsibility for the DRIC

Project, advised the DRIC Project steering committee that “the approvals for connecting a

second span [of the Ambassador Bridge] to the freeway system were already granted through the

Gateway Project.”

146. As contemplated by the Ambassador Bridge Gateway Project, the approach ramps

to the Ambassador Bridge on both the U.S. side and the Canadian side of the river were designed

to accommodate a connection to the New Span. Plaintiffs have spent over $500 million of their

own funds to acquire the land for the New Span and on other expenditures related to the New

Span and the Ambassador Bridge Gateway Project. CTC already owns all the land between the

ramp and the Detroit River on the Canadian side. And DIBC believes that it will be able to reach

agreement with the City of Detroit to purchase an easement, if necessary, to allow the New Span

to pass over the one unowned parcel of land (and the one city street) on the U.S. side after the


42

permits to build the New Span are in place. The ramps that would be used for the New Span

connect directly to the Ambassador Bridge’s existing toll and customs plazas on both the U.S.

side and Canadian side. The existing plazas have ample capacity to handle the expected traffic

from the New Span.

147. Plaintiffs intend to complete construction of the New Span entirely with private

funds.

(3) The Coast Guard Approval Process.

148. The Ambassador Bridge, including the New Span, is exempt from most permit

requirements. Under the U.S. Act, the rights of DIBC are subject to the requirements of the 1906

act to regulate the construction of bridges across navigable waters, the Act of Mar. 23, 1906, ch.

1130, 34 Stat. 84 (the “1906 Bridges Act”). See 1921 DIBC Act, § 1. Under the Canadian Act,

the rights of CTC are subject to (a) the Railway Act, 1919, except to the extent inconsistent with

the 1921 CTC Act and the 1922 CTC Amendment; and (b) the Navigable Waters’ Protection

Act. See 1921 CTC Act §§ 8, 20; 1922 CTC Amendment 6.

149. Nonetheless, Canada and FHWA have delayed and obstructed the construction of

the New Span by delaying approval under the Canadian Environmental Assessment Act and

interfering with DIBC’s application to the United States Coast Guard for a 1906 Bridges Act

permit (a “navigation permit”) for the New Span.

150. Plaintiffs submitted an environmental impact statement to Transport Canada for

the Ambassador Bridge New Span on December 4, 2007. Because the Ambassador Bridge New

Span will be constructed directly alongside the existing span and will connect to the existing

Ambassador Bridge plaza, any environmental impact will be insignificant or nonexistent.

However, no decision has been received to this date, over four years later.


43

151. By way of contrast, the agencies constructing the NITC/DRIC submitted their

Ontario Environmental Assessment Report in December 2008 and received a Notice of Approval

from the Ontario Minister of the Environment in August 2009, just nine months later, despite

serious concerns about the impact of the NITC/DRIC on the surrounding community, wetlands,

and species-at-risk in Canada. The Federal Screening Report under the Canadian Environmental

Assessment Act for the NITC/DRIC and plaza was released in July 2009 and approved just four

months later in December 2009.

152. On the U.S. side, the Coast Guard is the only agency that might have any relevant

permitting authority, because DIBC is building the Ambassador Bridge New Span without public

funds, and as noted, the Ambassador Bridge New Span is not subject to permitting requirements

of the International Bridge Act of 1972. The Coast Guard’s permitting authority is limited under

the 1906 Bridges Act to determining whether the Ambassador Bridge New Span would

negatively affect navigation on the Detroit River.

153. DIBC applied to the Coast Guard for a navigation permit for the Ambassador

Bridge New Span in 2004. The Coast Guard’s approval of the navigation permit should have

been a quick, routine process because the New Span will not create any new obstructions to

navigation: it will be placed directly next to the existing Ambassador Bridge span, it will be at

the same height as or higher than the existing Ambassador Bridge span at all points, and it will

not have any piers in the water.

154. The Coast Guard has taken the view that, before it may issue a 1906 Bridges Act

permit, the Ambassador Bridge New Span must satisfy the requirements of NEPA, 42 U.S.C. §§

4321-4370h. Initially, the Coast Guard appeared to be on track toward prompt approval of the

Ambassador Bridge New Span under both NEPA and the 1906 Bridges Act.


44

155. On July 28, 2006, the Coast Guard issued public notice 09-03-06, which took the

initial position that the Ambassador Bridge New Span was entitled to a Categorical Exclusion on

the basis of the prior NEPA assessments of the Ambassador Bridge Gateway Project. However,

the Coast Guard then reversed course and took the position that the Ambassador Bridge New

Span required an Environmental Assessment, which would lead to either a Finding of No

Significant Impact (“FONSI”) or a finding that a full-blown Environmental Impact Statement

was required.

156. The Environmental Assessment commissioned by the Coast Guard found no

reason to deny a FONSI and was accompanied by a proposed FONSI dated February 4, 2009.

The earlier public hearings on the proposed FONSI and environmental review process had

provided no reason for the Coast Guard to change its view. From DIBC’s initial submission of

its application in 2004 through the issuance of the proposed FONSI, the Coast Guard had

consistently maintained that “the ABEP [New Span]” will not introduce significant impacts on

the natural or man-made environment” and that environmental impacts, including on air quality,

would remain below the de minimis threshold.

(4) The Coast Guard’s Delay Of DIBC’s Application Under Pressure From Canada, FHWA, And Other NITC/DRIC Supporters.

157. The Coast Guard’s initially favorable treatment of the Ambassador Bridge New

Span application was altered by pressure from FHWA, Canada, and other NITC/DRIC

supporters seeking to derail the Ambassador Bridge New Span application, without good cause,

to favor the NITC/DRIC. As a result of this interference, the Coast Guard delayed action on the

application and ultimately denied it, without lawful justification, on March 2, 2010.

158. Although it issued a proposed FONSI in February 2009 and completed the thirty-

day review period required by NEPA, the Coast Guard did not issue the final FONSI. Rather,


45

the Coast Guard took the extraordinary step of scheduling a new public hearing on March 17,

2009 at the request of Congressman Dingell, at which the opponents of the Ambassador Bridge

New Span had been organized to appear, while supporters of the Ambassador Bridge New Span

were not given a fair opportunity to be heard. The Coast Guard then claimed that the concerns

raised at that public hearing justified delay in issuing, and ultimately a refusal to issue, the

FONSI.

(a) Air Quality Impacts.

159. The Coast Guard initially attempted to justify its delay largely based on erroneous

claims by FHWA that the Ambassador Bridge failed to conduct an appropriate air-quality

analysis. In direct contradiction to the position that FHWA is now taking with the Coast Guard,

DIBC had no difficulties receiving environmental approval from FHWA for its construction

projects supporting the Ambassador Bridge New Span before Canada had enlisted FHWA in its

campaign against the Ambassador Bridge. Between 1997 and 2004, FHWA had issued an

environmental assessment and three FONSIs for the Ambassador Bridge Gateway Project, based

on FHWA’s projected traffic volumes of 18 million vehicles a year across the Ambassador

Bridge. As discussed above, the Ambassador Bridge Gateway Project was the project to create

direct connections to the U.S. highway systems and to accommodate the New Span to the

Ambassador Bridge. The alleged air-quality impacts of bridge traffic were not a concern to

FHWA then; yet once FHWA had joined Canada in opposing the New Span, FHWA raised

alleged air-quality impacts with the Coast Guard in opposition to the new Span.

160. In response to FHWA’s stated concerns about the air-quality impacts, DIBC

contacted the Environmental Protection Agency (“EPA”) office in Chicago for guidance on

whether any further air quality analysis was required. The EPA addressed this issue in its

comments to the Coast Guard on the draft FONSI, stating that additional “hot spots” analysis


46

might be done but acknowledging that it was not required by statute. In response, DIBC

developed an Addendum to the initial Air Quality Modeling Analysis Report. This Addendum,

which DIBC submitted to the EPA and the Coast Guard on June 5, 2009, provided further detail

on possible air-quality impacts addressing the FWHA’s stated concerns.

161. The Coast Guard, however, instructed the EPA not to review the Addendum,

stating that the Coast Guard had not authorized any additional air quality analysis.

162. Yet, on June 15, 2009 – a week after making the statement that additional air

quality analysis was not authorized – the Coast Guard stated that it was placing all work on

DIBC’s application for the New Span into abeyance based, in part, on “concerns over air

quality.”

163. Then, despite its statements that it had not requested additional air quality analysis

and that it was putting all work in abeyance, the Coast Guard submitted the Addendum to

MDOT for review on July 14, 2009. MDOT responded on August 5, 2009 that it did not have

the authority to review air quality analyses for the project.

164. Two months later, the Coast Guard forwarded the Addendum to FHWA for

review. On December 1, 2009, FHWA responded that the Addendum was still inadequate to

model the worst-case scenario for the New Span.

165. The Coast Guard’s treatment of the alleged environmental impacts of the

Ambassador Bridge New Span contrasts sharply with FHWA’s treatment of the environmental

impacts of its own project, the NITC/DRIC. Any air-quality concerns applicable to the U.S. side

of the Ambassador Bridge New Span would also apply to an even greater extent to the

NITC/DRIC, because the NITC/DRIC will have additional, very significant construction work

and adverse impact on a local community that the New Span will not have. For example, the


47

NITC/DRIC will require a new plaza in the United States (in close proximity to the existing

Ambassador Bridge plaza), and because other new highway connections would have to be built

for the NITC/DRIC at taxpayer expense (adjacent to the existing highway connections for the

Ambassador Bridge). Moreover, the NITC/DRIC will have serious adverse environmental

impacts on a community in the Detroit area, which, according to FHWA’s own study, includes

displacing approximately 257 occupied residential dwelling units, forty-three active businesses,

five places of worship, and four government facilities in Detroit’s only majority-Hispanic

neighborhood. Yet, despite these significant impacts, and in contrast to the concerns it voiced

relating to the New Span, FHWA granted expedited environmental approval for the NITC/DRIC.

The entire set of approvals for the NITC/DRIC is subject to an interagency “streamlining

agreement” designed to speed the project through the U.S. approval process and to prevent the

agencies from revisiting key issues about the NITC/DRIC even in the face of public opposition.

After the NITC/DRIC’s Final Environmental Impact Statement (“FEIS”) was released on

November 26, 2008, FHWA issued its Record of Decision and bragged about its own haste,

announcing that the entire review process for the NITC/DRIC was completed in “about half the

time needed for similar projects of this size.”

166. It has been more than three years since FHWA completed its FEIS for the

NITC/DRIC. Recently, plaintiffs asked FHWA whether it has prepared or is preparing a written

re-evaluation of the NITC/DRIC FEIS. FHWA’s own regulations require it to prepare a re-

evaluation of the over-three-years-old FEIS before it or any other agency may grant further

approvals related to the NITC/DRIC. Moreover, as plaintiffs pointed out to FHWA, the

NITC/DRIC FEIS relied on traffic projections based on data that is almost a decade old and has

been proven to be substantially overstated by more recent actual traffic data. The corrected data


48

calls into question whether the NITC/DRIC is needed in light of the substantial environmental

impact it will have and the fact that the Ambassador Bridge and its projected New Span will

satisfy capacity needs with far less environmental impact. Nevertheless, FHWA responded that

it has not prepared such a re-evaluation and does not plan to.

167. In considering the NITC/DRIC proponents’ application for a Presidential permit

and issuing that Permit, the State Department relied upon this more-than-three-years-old

NITC/DRIC FEIS, in direct conflict with FHWA’s regulations.

(b) Opposition By Canada.

168. In addition, the Coast Guard took the position that it should not proceed to issue

either a FONSI or a 1906 Bridges Act permit for the Ambassador Bridge New Span because the

Coast Guard was advised by Canada that Canada did not want the Ambassador Bridge New Span

to be built. The Coast Guard indicated that it would not proceed with U.S. approval until it

received assurances from its Canadian counterparts that there were no impediments to Canadian

approval. The Coast Guard maintained this position until, according to deposition testimony by

the Coast Guard’s designated witness in this action, the Coast Guard received a direct instruction

from White House officials that the Canadian process should not be permitted to interfere with

the U.S. process for the permit application.

(c) Land Acquisition.

169. Having been deprived by the White House of its ability to use Canada’s

opposition to plaintiffs’ plans as an excuse for its inaction, the Coast Guard ultimately attempted

to justify its refusal to proceed because of a need for DIBC to acquire property on the U.S. side

of the river to build the Ambassador Bridge New Span. Property ownership, however, is not and

has never been a requirement to proceed under NEPA. FHWA granted environmental approval

for the NITC/DRIC despite the fact that it and MDOT had not yet acquired all the necessary


49

land. And on multiple previous occasions, before Canada and FHWA began their campaign

against the Ambassador Bridge, DIBC received environmental approvals for its improvements

on the Ambassador Bridge before it had acquired the necessary land.

170. The Coast Guard has no basis to conclude that the property issue that it has cited

will not be promptly resolved once the Coast Guard permit is in place. Although the City of

Detroit wrote a letter to the Coast Guard stating that it was not interested in selling the parcel of

the land in question, the letter was plainly an attempt by the City of Detroit to gain bargaining

leverage by holding up the Coast Guard navigation permit. The parcel consists of fallow ground

that the City has designated as an annex to a park but which is not suitable for park use because

of toxic waste contamination. Indeed, at one point the City of Detroit allowed DIBC to use the

land for storage of material and equipment. In any event, the plans for the Ambassador Bridge

New Span do not call for placement of any structures on land currently owned by the City of

Detroit. Thus, DIBC does not need to acquire the land itself but only the air rights for the

Ambassador Bridge New Span to cross above the land.

171. Obtaining approval before spending the money to buy the land or easements for a

project is a sensible and common approach and is the sequence also adopted by the agencies

promoting the NITC/DRIC. In fact, plaintiffs or their affiliates currently own much of the land

that FHWA or MDOT needs for the NITC/DRIC’s landings on the U.S. side of the Detroit River.

The cooperating agencies have not yet sought to acquire that land from plaintiffs or their

affiliates. Yet that has not stopped FHWA from proceeding to issue a NEPA Record of Decision

for its own NITC/DRIC Project, a clear instance of discrimination against the privately-owned

New Span and in favor of the government-owned NITC/DRIC.


50

(5) The Coast Guard’s Denial Of DIBC’s Application.

172. Following receipt of the June 15, 2009 letter from the Coast Guard placing its

permit application into abeyance, DIBC complained to the Department of Homeland Security

(“DHS”), of which the Coast Guard is a part, that the Coast Guard was refusing to process

DIBC’s Environmental Assessment for inappropriate reasons. Janet Lesher, then Chief of Staff

for Secretary Napolitano, chaired a meeting in December 2009 between the Coast Guard and

DIBC and instructed that a follow-up meeting be held one week thereafter at which the parties

should resolve their differences. The Coast Guard caused the second meeting to be cancelled

because the Coast Guard claimed that it needed additional time to prepare. The holidays then

intervened, and in February 2010, Ms. Lesher resigned from DHS. DIBC repeatedly sought

further meetings through DHS to no avail.

173. The Coast Guard never contacted DIBC to propose a substitute meeting date.

Instead, it advised DIBC by letter on March 2, 2010, that it was discontinuing consideration of

DIBC’s applications for a navigation permit and a FONSI for the Ambassador Bridge New Span

and returning the applications. The Coast Guard’s letter claimed that there had been “no

movement” by DIBC or its related entities on the supposed “issues” that FHWA and the other

proponents of the NITC/DRIC had raised in an attempt to derail the construction of the

Ambassador Bridge New Span.

174. By returning DIBC’s application and discontinuing consideration for a navigation

permit and a FONSI, the Coast Guard made clear that the agency process was complete. Any

further action would require DIBC to resubmit the application in its entirety or to submit a new

application. No mechanism for an administrative appeal is available. Coast Guard regulations

require the Coast Guard to either grant or deny an application, see 33 C.F.R. § 115.60(a), thus

the return of the application necessarily constitutes a denial.


51

175. The Coast Guard’s denial of the application constitutes final agency action.

Plaintiffs have exhausted their administrative remedies, if any, to the extent required.

(6) Status Of The Current Litigation And The Coast Guard’s Failure To Follow This Court’s Explicit Orders.

176. Plaintiffs filed a Complaint in this court on March 22, 2010 and a First Amended

Complaint on June 6, 2011, both of which asserted (as did plaintiffs’ Second Amended

Complaint and as does this Third Amended Complaint), among other claims, a claim against the

Coast Guard defendants under the Administrative Procedure Act for their failure to process and

approve DIBC’s application for a permit for the New Span.

177. On May 10, 2012, this Court ordered DIBC to re-submit its application to the

Coast Guard with a revised Environmental Assessment and explicitly ordered the Coast Guard to

“consider and process the application, at least until the Coast Guard decides whether an

Environmental Assessment and Finding of No Significant Impact would satisfy NEPA, 42

U.S.C. § 4321, et seq, without respect to whether or not Plaintiff owns land or air rights to

expand the Ambassador Bridge as set forth in its permit application” (emphasis added).

178. On July 17, 2012, the parties appeared before this Court for a status conference, at

which point the Coast Guard identified the only two issues that remained before it could issue a

final FONSI, concluding the NEPA process: (a) the EPA had to finalize its assessment of certain

air quality studies and determine whether to impose a new requirement based on a regulation not

yet in force; and (b) the Michigan State Historic Preservation Office (“SHPO”) had to provide an

assessment of whether the slight re-design of the New Span would cause SHPO to re-assess the

project. Before the next status conference on August 24, 2012, both issues were resolved: in

August 22, 2012 and August 23, 2012 emails, the EPA informed the Coast Guard that the New

Span’s air quality documentation “demonstrates conformity” with the existing environmental


52

standard and “will not cause or contribute to a violation” of that standard, and in a July 20, 2012

email, SHPO confirmed that the New Span re-design did not trigger any re-assessment of the

project. There was therefore no remaining basis for the Coast Guard to refuse to issue the

FONSI.

179. Nevertheless, the Coast Guard moved the goalposts yet again. Contrary to this

Court’s explicit order, the Coast Guard stated at the August 24, 2012 status conference that it is

not able or willing to complete the NEPA process until DIBC and CTC can demonstrate there is

no issue with respect to the “air rights” because “we don’t have a completed application” and

therefore the New Span project is only “hypothetical.”

180. It has now been over six years since the Coast Guard deemed the New Span

permit application complete on July 13, 2006. The Coast Guard’s openly defiant position is yet

another way to delay granting the FONSI and has no legal basis.

D. Canada’s And FHWA’s Proposed NITC/DRIC.

(1) The NITC/DRIC Partnership.

181. In December 2000, Transport Canada (part of the Canadian Ministry of Transport,

Infrastructure, and Communities), FHWA, MDOT, and the Ontario Ministry of Transportation

formed a working group called the Ontario-Michigan Border Transportation Partnership, which

later became the Detroit River International Crossing (“DRIC”) Partnership, in order to study

transportation needs in the area. (As explained above, the “Detroit River International

Crossing,” or “DRIC,” was the original name for the NITC/DRIC and these terms are now used

interchangeably.)

182. The construction of the Ambassador Bridge New Span and the completion of the

Canadian portion of the Ambassador Bridge Gateway Project had initially been on the DRIC


53

Partnership’s agenda as a way to improve traffic flow and commerce in the Detroit-Windsor

area.

183. Within a few years after the DRIC Partnership was formed, however, Canada

realized that the DRIC study project created a new opportunity to attempt to force the transfer of

the Ambassador Bridge to ownership and control by Canada, this time by proposing to build a

new bridge, the NITC/DRIC, between Detroit and Windsor, planned and sited so as to take

nearly all the traffic revenue from the Ambassador Bridge.

184. The members of the DRIC Partnership entered into a number of contractual

agreements to further their purpose, including by agreeing to the Ontario-Michigan Border

Transportation Partnership Framework on February 7, 2001, and by adopting the Canada-United

States-Ontario-Michigan Border Transportation Partnership Charter on February 2, 2005. In

2007, the departments of the United States and Canada that oversee the DRIC Partnership

members entered into the Memorandum of Cooperation Between the Department of

Transportation of the United States of America and the Department of Transport of Canada on

the Development of Additional Border Capacity at the Detroit-Windsor Gateway (2007).

185. Each of these agreements constituted agreements between MDOT and both

Canada and Ontario. As such, each of these agreements were prohibited by Article I, §10, clause

3 of the Constitution, absent consent from Congress. Yet none of these various agreements were

ever approved by Congress. Nor were any of these agreements ever approved by the Secretary

of State. As such, these agreements all constituted invalid agreements between a State and a

foreign power.

186. As described in a communication from the American Consulate in Toronto to the

Secretary of State, U.S. and Canadian officials, including David Wake from the Ontario Ministry


54

of Transportation and representatives from the U.S. Army Corps of Engineers and the Coast

Guard, attended an October 19, 2005 meeting in Detroit at which the “meeting participants

agreed that, if the bridge span twinning proposal is rejected by Canada, the U.S. side will drop it

from consideration.” There appeared to be no limitation on this agreement, for example

requiring that Canada only reject the New Span proposal for valid environmental, navigational,

or regulatory reasons.

187. This communication confirms that agents of the Canadian government took

actions in the United States to prevent DIBC from exercising its right to build the New Span,

including by persuading U.S. government agencies to block DIBC’s ability to obtain approval

for the New Span on grounds unrelated to navigational, environmental, or regulatory issues.

Instead, Canada acted in the United States to persuade U.S. agencies to block DIBC’s right to

build the New Span solely to advance Canadian commercial interests and on the basis of

Canada’s longstanding hostility to the existence of a privately owned bridge between Detroit and

Windsor.

188. In addition, under the Treaty clause of the U.S. constitution, Article 2, § 2, clause

2, the FHWA does not have the authority to enter into an agreement with a foreign power. Thus,

the FHWA’s participation in the DRIC Partnership agreements was also unauthorized and

invalid.

189. Indeed, members of the DRIC Partnership recognized that they were not

authorized to enter into agreements with Canada. For example, James Steele of the FHWA

admitted this in a March 28, 2006 email: “The groups [sic] original intent was to develop a

charter, or document of some kind that described how we intended to operate. . . . Pretty soon the


55

legal folks got involved and it got pretty complicated and we realized we were creating a treaty.

It was then that we shifted to a more informal gentleman’s agreement . . . .”

190. But the DRIC Partnership agreements are not mere “gentlemen’s agreements.”

They reflect a commitment to form a partnership, with its own charter, to build a government-

owned bridge, and thereby displace and destroy the right of plaintiffs to build their New Span.

(2) Canada’s Opposition To The Twinning Of The Ambassador Bridge.

191. The DRIC Partnership identified fifteen potential crossing sites across the Detroit

River for the location of a possible new bridge. These were designated X1 through X15, with

“X” standing for “crossing.”

192. The potential crossing sites identified by the DRIC Partnership included a site

designated as X12, which would have been a twinning of the existing Ambassador Bridge.

193. At the outset of its consideration of alternatives, the DRIC Partnership professed

to be open to various ownership structures. In an official position statement regarding the

ownership of a new crossing issued in August 2005, the DRIC Partnership stated that the

additional border crossing would be “subject to appropriate public oversight in both countries,”

and the alternative governance models included, but were “not limited to: Government

ownership . . .; a concession agreement in which the private sector designs, builds, finances, and

operates the facilities under a long-term lease arrangement with the governments; [and] other

options that may be appropriate and developed by the partners.” FHWA, at least initially,

recognized the benefits of private ownership, as the minutes of a May 2006 DRIC Partnership

Steering Committee meeting describe James Steele of FHWA asking “why spend government

money if the private sector is willing to spend money to solve the problem?”

194. Location X12, which was a twinning of the Ambassador Bridge, was thus

consistent with the construction and ownership of the Ambassador Bridge New Span as proposed


56

by plaintiffs. Indeed, the FHWA noted in its Draft Environmental Impact Statement analyzing

the different alternatives that it had received four alternatives proposed by private companies,

and it included among them the X12 location proposed by DIBC.

195. Although these public statements suggest that all ownership and governance

options, including a privately built bridge, were being considered, internal documents show that

Canada had already firmly concluded that it would not allow plaintiffs to own any new crossing,

whether or not it was a twin of the existing Ambassador Bridge. In a series of internal emails

drafted by Andrew Shea, a Policy Advisor for Transport Canada, Mr. Shea described Canada’s

position, as endorsed by the Ontario Ministry of Transportation, as follows: “regardless of where

the new crossing is located, there will, implicitly, be public control of that crossing. Therefore

this would not preclude a twinned Ambassador Bridge from [being] chosen under the [DRIC

Partnership process], except that the Ambassador Bridge wouldn’t control it . . . .”

196. FHWA ranked X12, the twin of the Ambassador Bridge, very high among the

various alternatives under consideration.

197. Canada realized, however, that even if the new crossing were to be publicly

owned, selection of a site at the location of the Ambassador Bridge would necessarily require the

new crossing to share a highway connection with the Ambassador Bridge, which in turn would

allow the Ambassador Bridge to compete with the new crossing on a fair basis. Moreover, any

environmental or other regulatory approvals obtained by the DRIC Partnership for a new

publicly owned bridge at the X12 site would equally support an application for approval of

plaintiffs’ privately owned option at the same site. For these reasons, the consideration and

potential approval of the X12 crossing location would have been a direct threat to Canada’s long-


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term goal of acquiring control of plaintiffs’ franchise by building a new bridge and preventing

plaintiffs from competing.

198. For these reasons, the Canadian government resolved to drop site X12 as an

alternative as soon as practicable, though it recognized that it did not have any justification for

rejecting that site within the stated criteria governing the DRIC project. In an email reporting on

a DRIC Partnership Working Group Meeting held September 28, 2005, Tim Morin, a Transport

Canada project engineer, observed that “X12 ranks high on the US side and not so high on

Canadian side,” but recognized that “in order to maintain the integrity of the environmental

assessment X12 will most likely have to remain based on the technical data at the moment . . . .”

Reporting on a DRIC Steering Committee meeting held in October 2005, a Transport Canada

official, Sean O’Dell, recounted that Canada had “argued strongly that the twinning option was

not acceptable,” while acknowledging FHWA’s arguments that “eliminating this option could

not be done on the basis of the strict [environmental] analysis” and that the DRIC Partnership

“would be better off to delay a likely court challenge from the twinning proponents by keeping

[X12] on the short list and strengthening the case for dropping it through further analysis . . . .”

199. Canada’s own technical consultants and the Ministry of Transportation of Ontario

(“MTO”) took the position that X12 should be given further consideration. As recounted by Mr.

O’Dell in an October 2005 email, “[b]oth MTO and our consultants were strongly of the opinion

that X12 could not be ruled out at this point on the basis of the technical criteria used in the

assessment of the alternatives.” This conclusion was compelled by the fact that none of the

objections raised by Canada to X12 formed “part of the terms of reference of the accepted

criteria for this phase of the assessment,” and left Canada “as the sole partner arguing that [X12]

should be dropped now.” Yet later that month, Mr. O’Dell sent an email to FHWA objecting to


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the publication of a FHWA study on the NITC/DRIC because Canada did “not agree that X12

should proceed.”

200. In response to the position taken by MTO and its own consultants that X12 could

not be eliminated based on technical criteria, Canada pressured its consultants in a discussion

held on October 28, 2005 to “‘carefully review’ all of the material, in light of all of the concerns

that have been raised, so that they can be confident in making a recommendation.” A

supplemental report prepared the next week altered key findings about the impact of the X12

crossing—including increasing the projected number of homes to be displaced by the project,

purporting to find new deficiencies with respect to impacts on the natural environment and

regional mobility, and increasing the projected price tag of the crossing by C$200,000,000.

201. In particular, Canada assumed that X12—the twin of the Ambassador Bridge—

would require a new 120-acre plaza on the Canadian side based upon its false assumption that

X12 would have to be a publicly-owned bridge. This was erroneous for at least two reasons:

first, the construction of a bridge at X12 would be the privately-owned New Span, and would not

be publicly-owned (and certainly would not need to be publicly-owned); second, even if X12

were publicly-owned, that would not require a 120-acre new customs plaza. There is ample

room at the existing plaza to accommodate a new span at X12 without the need for the massive

expansion assumed by Canada. This erroneous assumption was adopted by Canada purely as a

pretext for rejecting X12, which it had no justification for rejecting. Indeed, in April of 2013,

Transport Canada issued a Draft Environmental Assessment confirming that the construction of

the New Span would not create any significant environmental or community impacts.

202. Moreover, Canada’s proposed 120-acre plaza would be more than six times the

size of the current plaza on the Canadian side of the Ambassador Bridge, which currently has


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significant excess capacity. Even the Canadian Border Services Agency, which would be

responsible for customs operations at the plaza, had indicated that no more than 40 acres would

be needed. As noted above, the community impacts projected by Canada for the hypothetical

new plaza at the X12 site stemmed largely from Canada’s deliberately inflated, false assumptions

as to the appropriate size of the plaza.

203. In rejecting the site of a twinned Ambassador Bridge as a practical alternative for

a new crossing, Canada also argued that building a highway connection to the new crossing

would cause “unacceptable negative environmental impacts on Windsor.” Any landing site

would require additional highway infrastructure, however, and the preferred alternative crossing

ultimately chosen by NITC/DRIC Proponents itself requires the construction of a new highway.

The proposed route of that new highway passes within a mile of the Ambassador Bridge plaza,

and for most of its length, it follows the same route that would be followed by an improved

highway connection to the Ambassador Bridge. That new highway to the NITC/DRIC also

imposes numerous community and environmental impacts, including (according to Canada) the

displacement of approximately 370 homes, changes to cohesion and character in some

neighborhood communities, the displacement of over fifty businesses, the displacement of a

church, a school, and other cultural institutions, the displacement of wildlife, and potential

mortality to species at risk.

204. Even before Canada received its manipulated “analysis” of the impacts of X12,

Canada was stating in its internal briefing papers relating to the selection of the “practical

alternatives” for the DRIC Project that X12 had been eliminated and that “the study team is

confident that the decision is consistent with the process identified in the [Terms of Reference],

and that there is adequate data to support such a decision”—precisely the opposite of what


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Canada’s study team had just advised. Canada’s decision to reject X12 had already been made

before a purported justification to do so was found.

205. For these reasons and others, it is clear that Canada chose its assumptions

regarding the impacts of the X12 location to manufacture a pretext for insisting that the other,

United States members of the DRIC Partnership accept its rejection of the X12 location.

206. Canada and its U.S. partners subsequently announced that X12 would not be

included among the practical alternatives that would undergo further evaluation. This decision to

reject location X12 ensured that the NITC/DRIC would be separate from the Ambassador Bridge

and that the highway connection—which had been promised to the Ambassador Bridge as

Canada’s half of the Ambassador Bridge Gateway Project—would funnel traffic solely to the

NITC/DRIC.

(3) FHWA’s Acquiescence In Canada’s Rejection Of The Twinning Of The Ambassador Bridge.

207. While these internal communications were taking place within Canada, Canada

was simultaneously engaged in discussions with FHWA to influence FHWA’s analysis of

location X12. In a document titled the “Evaluation of Studied Alternatives and Determination of

Practical Alternatives,” signed on November 10, 2005 but not made public until over two years

later as an appendix to the Draft Environmental Impact Statement issued by FHWA in February

2008, FHWA confirmed that “the twinning of the Ambassador Bridge (X12), [was] ranked high

on the U.S. side due to its minimal direct environmental impacts and its high regional mobility

ranking” but noted that “the Canadian Partners have stated their intent not to continue the study

of their portion of this alternative.” After endorsing the Canadian evaluation of X12, and noting

again “that the Canadian partners have firmly stated their objections to alternative X12 and their


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unwillingness to consider this alternative further,” FHWA concluded that X12 would not be

considered a practical alternative for further study on the U.S. side.

208. In his deposition testimony in this action, the U.S. defendants’ designated witness

from FHWA confirmed that FHWA relied entirely on the Canadian “analysis” to make a

decision under NEPA to eliminate site X12, rather than performing its own analysis. He further

confirmed that the sole reason why X12, the twin of the Ambassador Bridge, was rejected during

the U.S. review process was Canadian opposition. Recognizing that it had no reasons of its own

sufficient to reject location X12, FHWA noted to MDOT on February 4, 2008, in the context of

commenting on the draft Environmental Impact Statement for the DRIC, that “[i]t would be

helpful if we had something in the record from Canada saying officially that they hated this

alternative and it was a ‘dealbreaker.’”

209. In rejecting the X12 alternative to accommodate Canada’s wishes, FHWA closed

its eyes to Canada’s assumption, in conducting its “analysis,” that any new bridge had to be

publicly owned and would not make use of the Ambassador Bridge’s existing facilities.

Canada’s assumption was contrary to FHWA’s and the DRIC Partnership’s official neutrality as

to ownership and governance issues. By refusing to examine Canada’s assumptions and other

relevant issues independently, FHWA improperly abdicated agency authority to the Government

of Canada.

210. In 2008, having been pressured by Canada to reject the X12 solution that would

twin the Ambassador Bridge, and having dropped several other sites at the request of the

Governor of Michigan, the members of the DRIC Partnership were left only with locations in

downtown Detroit in close proximity to—but not directly twinning—the Ambassador Bridge. At

the site ultimately selected (location X10B), the new customs and toll plaza for the NITC/DRIC


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on the U.S. side is planned nearly to abut the existing plaza for the Ambassador Bridge and to

use the existing highway connections that were built for the Ambassador Bridge Gateway

Project. On the Canadian side, the planned site for the NITC/DRIC is less than two miles from

the Ambassador Bridge, but—as Canada intended when it rejected X12—the planned highway

connection bypasses the Ambassador Bridge and instead steers traffic to the site of the proposed

NITC/DRIC.

211. Moreover, the FHWA continues to take actions to discriminate in favor of

approving the costly and unnecessary NITC/DRIC and to oppose the privately financed

Ambassador Bridge New Span. For example, as alleged above, FHWA personnel have

interfered with the Coast Guard’s evaluation of the DIBC application for a navigational permit,

causing a meritless delay in that process.

212. In addition, in January and March 2011, the FHWA sent letters to MDOT

confirming that the $550 million that Canada has proposed “donating” to the State of Michigan

to help finance the construction of the NITC/DRIC will qualify as the non-federal share for

federal aid programs under Title 23 of the United States Code. In other words, FHWA has

committed to provide federal “matching funds” to Michigan based on the “donation” of money

that Canada is making to support the irrational and unnecessary NITC/DRIC. These letters were

included as an exhibit in support of the NITC/DRIC Application that was submitted to the State

Department.

213. Furthermore, because the NEPA review of the NITC/DRIC is more than three

years old, the FHWA is legally required to conduct an additional evaluation of the environmental

impacts of the NITC/DRIC, which it is currently refusing to conduct.


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214. FHWA is also required to conduct further reevaluations of the NITC/DRIC in

response to future requests by MDOT and other Michigan state entities for federal matching

funds.

215. Thus, through all of the foregoing actions, the FHWA has acted and continues to

act in a manner that is designed to discriminate in favor of the NITC/DRIC and to defeat

plaintiffs’ ability to construct the New Span.

(4) Lack Of Public Need For The NITC/DRIC.

216. Each of the reasons cited by Canada and FHWA for pursing the NITC/DRIC and

refusing to support the Ambassador Bridge New Span is merely a pretext and lacks any

reasonable or rational basis.

(a) Alleged Traffic Needs For A Second Bridge.

217. Canada and FHWA have contended that the NITC/DRIC will serve traffic needs.

Traffic levels in the Southeast Michigan and Southwest Ontario transportation corridor, however,

are not sufficient to support an additional bridge in the Detroit-Windsor area, an area known as

the “Central Corridor.” For that reason, if the proponents of the NITC/DRIC build the

NITC/DRIC, at least one of the two bridges—the Ambassador Bridge or the NITC/DRIC—is

destined for economic failure. State Department officials internally acknowledged this in

communications from the American Consulate in Toronto to the U.S. Secretary of State, saying

in December 2006 that “The financial feasibility of constructing a new separate bridge will be

undermined if Ambassador Bridge owners construct a new six-lane twin span; particularly if, as

now seems likely, the existing four-lane bridge span can be refurbished and kept in operation for

many years to come” and in April 2007 that “The intense political machinations of the Windsor

border crossing chess game continue. The race is on to see whether the DIBC can complete its

twin span before the bi-national DRIC project is ready.”


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218. As Canada and FHWA knew or should have known, a large portion of the traffic

across the Detroit River consists of trucks transporting automobile parts between factories in

Ontario and Michigan. Over many years, as the American auto industry has continued to

decline, so has traffic across the Ambassador Bridge and other crossings. Traffic has been

adversely affected by the loss of manufacturing in the American Midwest to low-cost foreign

manufacturers, the loss of U.S. market share of American automobile manufacturers and hence

their suppliers, the general downturn in the auto industry, and the loss of the formerly significant

numbers of Americans traveling to Caesar’s Windsor Casino to gamble before the explosion of

casinos operating in Michigan and Ohio.

219. At its height in 1999, traffic crossing the existing Central Corridor crossings (the

Ambassador Bridge and the Detroit-Windsor Tunnel) reached a maximum of approximately 22

million vehicle crossings per year (12.3 million vehicles at the Ambassador Bridge and 9.5

million vehicles at the Detroit-Windsor Tunnel). In 2010, the traffic volume was less than half

that: only about 10.7 million vehicle crossings per year (7.2 million vehicles at the Ambassador

Bridge and 3.5 million vehicles at the Detroit-Windsor Tunnel). Canada, FHWA, and the other

NITC/DRIC Proponents have not articulated any rational reasons to expect that this trend would

reverse or traffic would increase.

220. Nonetheless, Canada, FHWA, and the other NITC/DRIC Proponents publicly

took the position in the Planning/Needs Feasibility Study (“P/NF Study”) issued in January 2004

that the NITC/DRIC was needed to serve increased traffic needs, based on a projection that

crossings would rapidly increase, rising to 23.5 million vehicle crossings in 2009. To attempt to

justify this conclusion, the NITC/DRIC Proponents in the P/NF Study adopted a conclusion from

a report that had been prepared outside the public consultation process and that drew a straight


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line extrapolating upward from a brief, small increase in traffic around the time of the study,

ignoring what was otherwise a general downward trend in traffic patterns. The P/NF Study

offers no economic or other reasons to expect that such an increase would occur.

221. In contrast to their public statements relying on the P/NF study, internal

communications indicate that both FHWA and Canada recognized that there was no necessity for

another crossing. In an internal FHWA briefing paper from June 2006, FHWA recognized that

the Ambassador Bridge New Span was likely to “preclude the need for another publicly

controlled crossing for 30 years,” even if the inflated traffic projections set forth in the P/NF

Study proved accurate. Even if the NITC/DRIC were built, FHWA projected that the best

alternatives would only result in 3% fewer Vehicle Hours of Travel for border crossings in the

Central Corridor. A confidential memorandum regarding border infrastructure, drafted in March

2004 for the Canadian Minister of Finance, acknowledged the decrease in traffic across the

Ambassador Bridge and attributed it, in part, to a decrease in American visitors to Windsor

following the opening of new casinos in Michigan and long-haul truck traffic traveling across

alternative routes.

222. Canada and FHWA further acknowledged that observed border delays at the

Ambassador Bridge were the result of the shortage of customs staff supplied by the U.S. and

Canadian governments rather than any shortage of capacity of the bridge and associated

facilities. Even the 2004 P/NF Study acknowledged that “one of the key challenges facing

border processing agencies, particularly on the U.S. side of the border, is having sufficient

staffing available,” and an undated draft of an FHWA report titled “The Northern Border” was

even more explicit: “one of the most critical issues the crossing is facing is the lack of staffing.”

The same report noted that the present level of staffing at the border was less than half what was


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actually needed. According to the 2004 confidential memorandum for the Canadian Minster of

Finance, “most delays at the [U.S.-Canadian] border are not caused by inadequate

infrastructure,” noting a 2003 study that found delays “were mainly the result of inadequate

customs’ staffing levels, particularly on the U.S. side.” An independent review and assessment

prepared by Dr. John C. Taylor for the Ontario Ministry of Transportation’s consultant in July

2004 confirmed that “existing border backups and delays are a function of inadequate border

processing infrastructure and staffing, and not a result of bridge roadbed capacity problems.”

223. In fact, the traffic projections in the P/NF Study, on which Canada and FHWA

publicly relied despite their private doubts, have turned out to be completely wrong. The traffic

data in the intervening seven years since the P/NF Study shows a decline in traffic in accordance

with the general trend, not the sharp increase predicted by the P/NF Study. In 2010, only about

7.2 million trucks, buses, and passenger vehicles crossed the Ambassador Bridge, not the 14.7

million that the P/NF Study predicted.

224. The economic changes in the automobile and other manufacturing industries and

the loss of cross-border traffic to casinos in Windsor continue to have a major adverse effect on

bridge traffic today. Canada’s and FHWA’s projection of increased traffic based on the P/NF

study, however, assumes these changes never occurred. Subsequent traffic projections published

by NITC/DRIC proponents are similarly outdated, speculative, and incomplete, and are contrary

to observed trends in traffic volume.

225. Moreover, even if traffic levels do recover, plaintiffs have demonstrated through

their investments at the Ambassador Bridge that technological improvements can produce

substantial reductions in customs processing times, thereby increasing capacity without

additional bridge infrastructure. Plaintiffs have recently constructed state-of-the-art customs


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preclearance facilities in Canada, where trucks headed toward the Ambassador Bridge can

transmit their customs paperwork electronically to U.S. customs inspectors hours before the

trucks even arrive at the bridge. As a result of this advance, the average number of trucks

diverted to secondary inspection decreased from approximately 800 per day in 2008, prior to the

opening of the preclearance facility, to fewer than twenty four per day in 2011. Plaintiffs plan to

construct similar facilities in the United States for trucks planning to cross the Ambassador

Bridge into Canada. These improvements, paid for by plaintiffs’ private funds, have greatly

improved the speed of customs clearance across the border and have served as a model that

customs border officials have made a future requirement for all international crossings between

the United States and Canada.

226. David Jacobson, the U.S. Ambassador to Canada, acknowledged in a speech

delivered in Ottawa on Tuesday, March 9, 2010, that border crossings between the United States

and Canada are faster than they were before the terrorist attacks of September 11, 2001, despite

greatly heightened security requirements, because of technological improvements. In 2010, the

average delay for vehicles crossing into Canada on the Ambassador Bridge at the peak traffic

hour during the afternoon was only ten minutes.

227. Even if additional bridge capacity were needed, it could be served more cheaply

and efficiently—and consistently with plaintiffs’ legal rights—by twinning the Ambassador

Bridge with the goal of keeping both spans open after renovations on the original span. The

FEIS for the NITC/DRIC, prepared by FHWA based on FHWA’s inflated traffic projections,

concluded that ten lanes of roadway will be required to handle the traffic anticipated in 2035.

There are four lanes in the current span of the Ambassador Bridge, six lanes proposed for the

New Span of the Ambassador Bridge, two lanes at the Detroit-Windsor Tunnel, the equivalent of


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two lanes in the form of the two Canadian Pacific rail tunnels under the Detroit River, the

equivalent of two additional lanes in the form of a proposed double-stacked Canadian Pacific rail

tunnel under the Detroit River, and the equivalent of one lane in the form of the Detroit-Windsor

Truck Ferry. Together, these existing and anticipated crossings will provide more than ample

capacity across (or under) the Detroit River. These crossings are in addition to the six lanes of

the twinned Blue Water Bridge between Port Huron, Michigan and Sarnia, Ontario, the

equivalent of two lanes in the form of the Canadian National double-stacked rail tunnel in Port

Huron, Michigan, the equivalent of two lanes in the form of the ferries operating between Port

Huron, Michigan and Sarnia, Ontario, and the equivalent of one lane in the form of a ferry

between Algonac, Michigan and Ontario.

228. As explained above, Congress and the State Department have already confirmed

that DIBC has the right to expand or twin the Ambassador Bridge by adding the New Span,

which DIBC is actively trying to do. Despite this, FHWA’s traffic projections fail to take into

account the increased traffic capacity that the New Span will provide.

(b) Alleged Community Impacts Of Ambassador Bridge Improvements On The Canadian Side Of The River.

229. Canada has also suggested that the NITC/DRIC is necessary and that any

expansion of the Ambassador Bridge is inappropriate because of the Ambassador Bridge’s

alleged impacts on the surrounding community, based on the assumption that the construction of

an Ambassador Bridge New Span would require an expanded bridge plaza in Windsor.

230. However, as Canada and FHWA know or should know, there is no need for an

expanded Ambassador Bridge plaza, and plaintiffs’ plans to connect the New Span to the

existing plaza do not require an expansion of the plaza. As discussed, the requirement for an

expanded plaza on the Canadian side, analyzed by Canada in rejecting twinning of the


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Ambassador Bridge as part of the DRIC Project, assumed that the new crossing would be

publicly owned, that the existing facilities owned by plaintiffs would not be available for the new

crossing, and that the newly constructed plaza would be much larger than required.

231. As noted, plaintiffs have already constructed the ramps that would connect the

New Span to the existing plazas on the U.S. and Canadian sides. All the land between the

connection ramps and the river on the Canadian side is already owned by CTC, so no additional

land acquisition on the Canadian side would be required to complete the New Span and connect

it to the existing plazas.

232. Canada also has claimed that the twinning of the Ambassador Bridge is

inappropriate because of the absence of a direct highway connection from the Ambassador

Bridge to Highway 401 in Canada. The reason there is no highway connection to the

Ambassador Bridge is because Canadian officials diverted the C$300 million that had been

allocated to building such a connection to other uses. As a result, the improvement to the access

route to the Ambassador Bridge, which was designed to complement the Ambassador Bridge

Gateway Project on the U.S. side, never occurred. And, as noted above, the impacts of a

highway connection to the Ambassador Bridge are similar to those of the proposed highway

connection to the NITC/DRIC, most of which follow the same route as would a highway

connection to the Ambassador Bridge.

(c) Alleged Need For Redundancy.

233. Canada, FHWA, and the other NITC/DRIC proponents have also cited

“redundancy” as a reason for building the new NITC/DRIC, meaning that having two bridges

(the NITC/DRIC and the Ambassador Bridge) would avoid traffic interruption in the event that a

natural or manmade disaster or other incident shut down one of the bridges. FHWA has

variously described the need for “redundancy” as related to ensuring “fiscal security” and


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“physical security,” but has stated that both refer to the risk to transportation that would result

from the disruption of a crossing.

234. However, once the decision was made to site the proposed NITC/DRIC in the

near vicinity of the Ambassador Bridge, any “redundancy” justification ceased to apply.

Building a new bridge in close proximity to the existing Ambassador Bridge in the Central

Corridor would not provide materially greater redundancy in the system than would a second

Ambassador Bridge span, because a problem such as a natural disaster or terrorist attack at one

bridge would almost certainly affect the other. In 2005, the U.S. Department of State sent a

letter to FHWA advising them “that the proximity of any new crossing to the existing crossings

may mean that a problem at any one crossing may affect all the centrally-located crossings.”

235. Moreover, in addition to the Ambassador Bridge, several other border crossings

are already in operation between eastern Michigan and southwestern Ontario. In the Central

Corridor alone, international traffic has at least two alternatives to the Ambassador Bridge. The

Detroit-Windsor Tunnel, operated by the cities of Detroit and Windsor, has been in operation

since 1930, providing a second road connection for cars and trucks less than three miles from the

Ambassador Bridge. The Detroit-Windsor Truck Ferry, operating since 1990, provides another

alternative for trucks just two miles from the Ambassador Bridge.

236. Other crossings are available a short distance from the Central Corridor. The

Blue Water Bridge, which connects Port Huron, Michigan and Sarnia, Ontario across the St.

Clair River about 60 miles north of the Ambassador Bridge, provides a third road connection for

cars and trucks. Traffic from Chicago to Toronto travels almost exactly the same distance

whether it uses the Ambassador Bridge or the Blue Water Bridge. The publicly owned Blue

Water Bridge has been open since 1938 and was twinned in 1997 with public funds from Canada


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and the U.S. to increase its traffic capacity, without any objection by Canada or FHWA that

twinning would not contribute to redundancy.

237. Twenty miles south of the Blue Water Bridge, the St. Clair River ferries provide

connections for cars and trucks between Marine City, Michigan and Sombra, Ontario, and

between Algonac, Michigan and Walpole Island, Ontario. Moreover, there are two railway

connections in the area: the Canadian Pacific Railroad has a tunnel between Detroit and

Windsor, built in 1910 and located a mile from the Ambassador Bridge, which is currently being

modified to allow double-stacked railcars; and the Canada National Rail Tunnel provides a

railway connection between Port Huron and Sarnia. Each of these crossings would provide an

additional means of transportation between the United States and Canada in the greater Detroit-

Windsor area in the event that traffic is ever interrupted at the existing Ambassador Bridge span,

the proposed Ambassador Bridge New Span, or both.

(d) Alleged Need For Public Governance.

238. Canada, FHWA, and the other proponents of the NITC/DRIC have often cited

governance concerns as a reason for rejecting private ownership of any new crossing. According

to FHWA, public ownership of the bridge, preferably through a public-private partnership with a

long-term concession agreement to a private entity, is justified by the public policy goals of

minimizing the use of public taxpayer funds while providing a safe and secure crossing.

239. Unlike the proposed NITC/DRIC, the Ambassador Bridge New Span would not

use any public funds at all and thus would be a superior means of meeting the goal of minimizing

the use of public taxpayer funds.

240. Moreover, defendants have not disputed that plaintiffs and their predecessors have

provided travelers a safe and secure crossing for nearly 82 years. Since 2008, expenditures by

plaintiffs on security and safety have averaged approximately $700,000 annually. In addition,


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DIBC has obtained assessments of the Ambassador Bridge applying the National Bridge

Inspection Standards, and the bridge has consistently been judged to be far safer than many

publicly owned crossings. Border security at the Ambassador Bridge is also state of the art and

constantly improving. In 2002, President George W. Bush and Prime Minister Jean Chretien

lauded steps taken by DIBC, CTC, and customs authorities to tighten border security through the

Free and Secure Trade initiative and expanded use of photo identification.

241. Any safety and security concerns of defendants regarding a privately owned

bridge can be addressed by reasonable safety and security regulations. In fact, over 85% of the

country’s critical infrastructure, as determined by the Department of Homeland Security, is

owned by the private sector. Moreover, if plaintiffs’ operation of a crossing ever became

unsatisfactory, Canada and the U.S. could exercise their powers of eminent domain. They have

never attempted to do so.

(e) Canada’s Continued Effort To Discriminate Against The New Span And In Favor Of The NITC/DRIC.

242. As alleged above, Canada has provided prompt regulatory approvals for the

NITC/DRIC project, even while delaying unreasonably and indefinitely any approvals for the

much smaller and less environmentally impactful project of allowing plaintiffs to exercise their

right to build the New Span to the existing Ambassador Bridge.

243. Another glaring example of Canada’s discrimination against the New Span and in

favor of the NITC/DRIC can be found in Canada’s development of a highway connection

between the location of the proposed NITC/DRIC (which does not exist and has not even been

approved yet), and its refusal to build similar highway connections to the Ambassador Bridge.

244. Specifically, in 2005 (and subsequent years), Canada deliberately altered its road

construction plans to avoid improving the roads accessing the Ambassador Bridge. First, Canada


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committed itself to building a new bridge (the NITC/DRIC) that would be owned and operated

by the Canadian Government (or a private concessionaire chosen by the Canadian Government),

not by DIBC. Second, Canada created a plan to build a highway connection from Highway 401

to the chosen location for the NITC/DRIC (but not to the Ambassador Bridge). This new

highway connection is called the Windsor-Essex Parkway.

245. Canada deliberately designed the Windsor-Essex Parkway to avoid improving the

connection between the Ambassador Bridge and Highway 401. Initially, Canada adopted a

circuitous design that was wholly impractical, and that had as its sole justification the desire to

avoid connecting with the road that leads up to the Ambassador Bridge, because Canada was

committed to undermining the viability of the American-owned Ambassador Bridge.

246. After it became infeasible for Canada to embark on its original design of the

Windsor-Essex Parkway, it adopted a modified design that expanded and improved the roads

connecting Highway 401 along a route that led to both the Ambassador Bridge and the proposed

site of the NITC/DRIC. However, Canada deliberately stopped improving the connections just

two kilometers short of the Ambassador Bridge, choosing instead to develop and improve its

roads in a way that veered off the route to the Ambassador Bridge, towards the proposed site of

the NITC/DRIC. Thus, the end result is that the Windsor-Essex Parkway is approximately 11

kilometers long in total; over this total length, approximately 9 kilometers cover the route

between Highway 401 and the Ambassador Bridge. The final two kilometers to the Ambassador

Bridge were then deliberately left undeveloped, even while the remainder of the Parkway was

built in a different direction, away from the existing Ambassador Bridge, toward the site of the

unauthorized NITC/DRIC. Again, the only reason for Canada’s refusal to develop the Windsor-

Essex Parkway in a manner that covered the entire connection between Highway 401 and the


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Ambassador Bridge was its desire to undermine the American-owned Ambassador Bridge.

There is no other rational explanation.

247. Moreover, as noted above, Canada has used the fact that the final 2 kilometers of

the Windsor-Essex Parkway run to an unauthorized bridge rather than to the New Span as a

reason to refuse to authorize the New Span.

248. In December 2006, the American Consulate in Toronto noted in a communication

to the Secretary of State that “Windsor city officials, including recently re-elected Mayor Eddie

Francis, have retained high-caliber legal counsel who will certainly continue to pursue every

avenue to obstruct construction of a privately-owned twin span by the Ambassador Bridge that

would put more traffic on connecting city streets.”

249. Canada has recently taken additional steps in its effort to discriminate against the

New Span and in favor of the NITC/DRIC. In December 2012, the Canadian Parliament passed

legislation called the “Bridge to Strengthen Trade Act” that exempted the NITC/DRIC from a

number of Canadian regulatory approval requirements, either by granting the NITC/DRIC

automatic approval or by explicitly exempting the NITC/DRIC from the requirement. The

regulatory approvals the NITC/DRIC is no longer required to meet include the Fisheries Act, the

Navigable Waters Protection Act, the Species at Risk Act, section 6 of the IBTA, the Port

Authorities Operations Regulations, the Canadian Environmental Assessment Act, 2012, and any

additional requirement under any Canadian federal act to obtain a permit, license, approval, or

other authorization in relation to the construction of the NITC/DRIC or any related work from

which the Governor in Council decides to exempt the NITC/DRIC.

250. The Bridge to Strengthen Trade Act does not exempt the Ambassador Bridge

New Span from any requirements of Canadian law. Rather, as described in the Windsor Star and


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Detroit Free Press, Canadian officials have explained that this legislation was intended to

“insulate the DRIC (Detroit River International Crossing) from any future lawsuit on the

Canadian side by exempting the DRIC from any laws under which it would have to get permits

and permissions and things like that.”

251. Thus, the recent legislation is additional evidence of the effort Canada is making

to prevent the plaintiffs from exercising their right to build the New Span, and to ensure that the

NITC/DRIC is built before the New Span can be built.

252. Terrence Corcoran, the editor of the Canadian Financial Post, explained the

motivation behind Canada’s continued discrimination against the New Span in favor of the

NITC/DRIC: “[Prime Minister] Harper is the heavy-handed statist trying to cripple a private

entrepreneur. What Mr. Harper is really doing is using government power to do what Canadian

governments have wanted to do for at least five decades: thwart the private ownership – and if

possible take control – of the Ambassador Bridge.” Responding to a statement by Prime

Minister Harper that it is “ludicrous” that the Ambassador Bridge is privately owned, Mr.

Corcoran wrote: “If there’s anything ludicrous taking place here, it’s the great public-policy con

job around the need for a brand new bridge that in the end will require U.S. and Canadian

government spending of $4 billion – all to build a bridge for which there is no market.” He

concludes: “The Harper plan puts Canadian and U.S. taxpayers at risk. And all for – what? To

expand the role of government at the expense of private industry.”

E. The Crossing Agreement.

253. As described above, the Governor of Michigan, MDOT, MSF, and Canada

recently entered into a “Crossing Agreement” setting out the process for building the

NITC/DRIC. The Crossing Agreement commits Canada to a number of commercial activities in

the United States.


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254. The United States has previously contended in litigation with DIBC that DIBC’s

operation of the Ambassador Bridge, an international crossing between Canada and Michigan,

constitutes a “commercial enterprise.” In a separate case, the Sixth Circuit found that the State

of Michigan “takes the role of a market participant when it joins” with a private company to

construct ramps up to a privately-owned international crossing, even when using public funds to

complete its share of the work. In addition, of the 33 international bridges and tunnels between

the United States and Canada, 11 are privately owned. The operation of an international toll

bridge constitutes a commercial activity that a private party can engage in and continues to

constitute a commercial activity when a public party engages in it.

255. The Crossing Agreement admits that it “provides a framework for a Crossing

Authority established by Canada to design, construct, finance, operate, and maintain a new

International Crossing between Canada and Michigan . . . .” It requires Canada to “establish the

Crossing Authority” and provides that “The members of the Crossing Authority shall consist of

Canada and, at the discretion of Canada, Ontario.” The Crossing Authority is required to engage

in commercial activity in the United States because it is deemed to be “responsible for” a number

of aspects of this commercial enterprise, including “the design, construction, financing, operation

and maintenance” of the entire NITC/DRIC, half of which is located in the United States. The

business of planning, designing, constructing, financing, and operating the bridge is a

commercial activity, and activities related to those responsibilities that take place in the United

States are commercial activities in the United States.

F. The State Department’s Presidential Permit Application Process and Approval.

256. On July 11, 2012, the State Department published in the Federal Register an

application for a Presidential permit for the NITC/DRIC. The NITC/DRIC Application sought


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(1) a Presidential permit to build the NITC/DRIC and (2) State Department approval for the

Crossing Agreement entered into by the Governor of Michigan, MDOT, MSF, and Canada.

(1) The State Department Did Not Have The Constitutional Power To Approve The Crossing Agreement.

257. The Supreme Court has long held that Congress may not delegate the legislative

powers vested in it under the Constitution to the other branches of government unless it provides

an “intelligible principle” to which the party authorized to act under the delegation is required to

conform. Thus, for Congress to constitutionally delegate a legislative power to an administrative

agency, it must provide that agency with a clear and intelligible standard to follow in wielding

that legislative power.

258. Article 1, § 10 of the U.S. Constitution provides that “No State shall, without the

consent of Congress . . . enter into any agreement or compact with any other state, or with a

foreign power . . . .”

259. In the IBA, Congress provided its consent “for a State . . . to enter into agreements

(1) with the Government of Canada, a Canadian Province, or a subdivision or instrumentality of

either, in the case of a bridge connecting the United States and Canada . . . for the construction,

operation, or maintenance of such bridge in accordance with the applicable provisions of this

subchapter. The effectiveness of such agreement shall be conditioned on its approval by the

Secretary of State.” This constitutes a delegation of Congress’s Article 1, § 10 power. However,

the IBA fails to provide any guiding principle at all, let alone an intelligible principle, for the

State Department to apply in approving agreements entered into between a State and a foreign

country. The IBA’s purported delegation to the State Department of Congress’s power to

approve such agreements is therefore unconstitutional.


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260. The State Department has admitted in writing that, in delegating to the State

Department the power to approve agreements between a State and a foreign government, the

IBA “does not set forth a particular standard but rather provides broad discretion to the

Secretary of State in considering whether to approve an agreement between a U.S. state and the

government of either Canada or Mexico” (emphasis added). Thus, the State Department has

admitted that the IBA delegates a legislative power to the State Department without providing an

intelligible standard. This confirms that the IBA’s purported delegation is unconstitutional.

(2) DIBC Raised Numerous Reasons Why The NITC/DRIC Application Is Defective And Should Be Rejected; Despite This, The State Department Granted The Permit And Purported to Approve The Crossing Agreement.

261. In response to the NITC/DRIC Application, plaintiffs submitted a Comment on

August 9, 2012 and a Supplemental Comment on September 10, 2012 to the State Department,

both of which explained to the State Department that it should promptly reject the NITC/DRIC

Application for a number of reasons, including that the NITC/DRIC Application sought approval

of an agreement illegally executed by the Governor, MDOT, and MSF. Plaintiffs also

demonstrated that the proposed NITC/DRIC violates the plaintiffs’ exclusive statutory and

contractual franchise rights to construct, maintain, and operate an international bridge between

Detroit and Windsor; that it violates plaintiffs’ right to build a New Span to the Ambassador

Bridge; that there is no need for the NITC/DRIC and, in fact, it is demonstrably unnecessary; and

that the NITC/DRIC is contrary to the national interest for numerous reasons, including the fact

that it involves a public subsidy that is being used to undermine a privately-owned United States

business. In addition, plaintiffs demonstrated that the State Department was required to comply

with NEPA in considering the permit application. This included the need to ensure it had an

environmental analysis that it had independently reviewed and endorsed and which reached

independent environmental conclusions, based on all relevant information available to it at the


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time of its decision (such as up-to-date and correct traffic data), not simply that information

which may have been relied upon in earlier years or by other agencies at earlier moments. This

further included a duty to independently assess the purpose and need for the NITC/DRIC in light

of information known or available at the time of the State Department’s decision, including, for

example, through the consideration of up-to-date and correct traffic and other data (which had

not been considered by the outdated FHWA EIS).

262. The NITC/DRIC Application failed to demonstrate the need for the NITC/DRIC,

and relied on outdated and inaccurate traffic projections instead of the actual traffic data showing

far lower levels of traffic that cannot possibly justify the investment required to build the

NITC/DRIC. Moreover, the NITC/DRIC Application did not even discuss the New Span, and

made no effort to demonstrate that the NITC/DRIC would be needed over and above the New

Span. The NITC/DRIC Application appears to have been premised upon the inaccurate

assumption that the New Span would not be constructed, even though the State Department

acknowledged in 2005 that plaintiffs have the right to build the New Span, and even though

plaintiffs have been seeking to exercise that right for almost a decade. Thus, without explanation

or discussion, the NITC/DRIC Application was implicitly premised on an assumption that

plaintiffs would be prevented from exercising their statutory right to build the New Span. In any

event, by failing even to discuss the New Span, the NITC/DRIC Application failed to present an

adequate or accurate discussion of either the necessity for, or the national interest in, approving

and constructing the NITC/DRIC.

(a) The Illegality Of The Crossing Agreement.

263. The State Department does not have the authority to approve an application for a

new bridge that depends upon an illegal agreement. Indeed, the State Department has recognized

that it will not process a Presidential permit application until such “application is complete.” An


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application obviously cannot be “complete” if it seeks approval for an agreement that is illegal or

unauthorized, or otherwise entered into in violation of state law.

264. Plaintiffs notified the State Department in their Comment and Supplemental

Comment that the NITC/DRIC Application was incomplete because, among other reasons, all

three United States parties that entered into the Crossing Agreement on which the NITC/DRIC

Application was based did so in flagrant violation of Michigan law. The Michigan Legislature

has passed multiple statutes prohibiting MDOT and MSF from “expend[ing] any state

transportation revenue for construction planning or construction of the Detroit River

International Crossing” and stating that they “shall not commit the state to any new contract

related to the construction planning or construction of the Detroit River International Crossing.”

Act of Jun. 26, 2012, 2012 Mich. Pub. Acts 200, § 384(1), 2012 Mi. ALS 200 (2012); Act of

June 29, 2012, 2012 Mich. Pub. Acts 236, § 402(1), 2012 Mi. ALS 236 (2012).

265. Further, the Michigan Constitution does not permit the Governor to bind the State

to an agreement to build an international bridge absent legislative approval, which was not given

in this case. As noted above, the Michigan Legislature instead expressly prohibited spending any

money or entering any agreements related to the NITC/DRIC and, in each appropriation bill for

the last three fiscal years, prohibited appropriations to the Executive Office from being used “to

support any staff effort, projects, consultant expenses, or any other activity related to the

development, financing, construction, operation, or implementation of the Detroit River

International Crossing.” Act of Jun. 26, 2012, 2012 Mich. Pub. Acts 200, § 925(a), 2012 Mi.

ALS 200 (2012); Act of Jun. 21, 2011, 2011 Mich. Pub. Acts 63, § 925(a), 2011 Mi. ALS 63

(2011); Act of Sep. 30, 2010, 2010 Mich. Pub. Acts 191, § 925(a), 2010 Mi. ALS 191 (2010).


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266. The FHWA itself has recognized that “MDOT does not currently have the

authority to construct the DRIC project. Legislation would have to be enacted to authorize

MDOT to construct the DRIC project.” It has also stated that the NITC/DRIC is “contingent

upon, among other things, approval by the Michigan Legislature” and that “there is no dispute

that the DRIC may not go forward today without the approval from the state legislature.” Recent

documents produced by the Department of Transportation in response to FOIA requests likewise

state that the United States “Recognizes need for Michigan legislation and required US State

Dept. reviews,” in contrast to the Canadian view that incorrectly “Presumes various agreements

between Michigan and Canada can be finalized before needed Michigan legislation.” Similarly,

the State Department has recognized that it is “the Michigan legislature which must approve a

public/private partnership to build the project . . . . If the legislature does approve the project, the

key next step will be an application to the Department of State for a Presidential Permit.” The

Michigan Legislature has refused to provide such approval.

267. Nevertheless, the parties to the Crossing Agreement continue to proceed with

their plans to build the NITC/DRIC under its terms. For example, on October 9, 2012, the

Governor in Council of Canada issued letters patent for the incorporation of the Windsor-Detroit

Bridge Authority for the purpose of constructing the NITC/DRIC pursuant to the terms of the

Crossing Agreement.

(b) The NITC/DRIC Application Was Premature.

268. Plaintiffs also notified the State Department in their Comment and Supplemental

Comment that the NITC/DRIC Application was premature due to the extensive amount of

ongoing litigation related to the legality of the NITC/DRIC, including this suit, and the

Application’s dependence upon the outdated NITC/DRIC FEIS discussed above, among other

reasons.


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269. In addition, the State Department failed to respond to numerous Freedom of

Information Act (“FOIA”) requests submitted by plaintiffs for documents related to the

NITC/DRIC Application. Most glaringly, the State Department has yet to fully produce

documents in response to a FOIA request from as long ago as November 2011.

(c) The State Department Processed The NITC/DRIC Application, Purported To Approve The Crossing Agreement, And Granted A Presidential Permit For The NITC/DRIC.

270. On October 25, 2012, plaintiffs submitted a letter to the State Department asking

it to confirm that it would not process the NITC/DRIC Application due to the legal invalidity of

the Crossing Agreement and the State Department’s lack of constitutional authority to approve

such agreements, as well as for other reasons making the Application invalid, incomplete, and

premature.

271. Based upon prior communications, plaintiffs formed the understanding that the

State Department would not agree to give this confirmation, but instead was reviewing the

NITC/DRIC Application notwithstanding its legal infirmities. Thus, plaintiffs’ letter informed

the State Department that if no response was received, plaintiffs would assume that the State

Department was not agreeing to reject the NITC/DRIC Application as legally invalid,

incomplete, or premature.

272. On November 1, 2012, the State Department indicated that that it would not

respond to DIBC’s request for confirmation that the State Department understands that the

NITC/DRIC Application is based on an illegal and invalid Crossing Agreement, and indicated

instead that it was evaluating the Application and the comments it has received.

273. On April 18, 2013, the State Department published a notice in the Federal

Register informing the public that it had issued a Presidential Permit to the State of Michigan for

construction, operation, and maintenance of the NITC/DRIC. [78 Fed. Reg. No. 75 (April 18,


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2013) (the “State Department Notice of Approval”)]. This Notice did not mention whether or

not the State Department had also granted the separate approval of the Crossing Agreement.

274. On April 19, 2013, counsel for plaintiffs wrote to counsel for the U.S. defendants

to confirm that approval of the Crossing Agreement would occur separately from issuance of the

Presidential Permit and inquiring whether such approval of the Crossing Agreement had also

been granted.

275. On April 26, 2013, counsel for the U.S. defendants responded, confirming that

“the Presidential Permit itself does not include an approval of the Crossing Agreement,” but that

such separate approval of the Crossing Agreement had been granted by a letter dated April 12,

2013 from the State Department to counsel for Governor Snyder of Michigan.

276. The State Department issued the foregoing approvals without engaging in any

independent environmental analysis of the NITC/DRIC or any assessment under NEPA of the

purpose and need for the NITC/DRIC, and failed to give any indication that it considered any of

the up-to-date and accurate traffic data, which would have demonstrated that there are

insufficient traffic levels to justify the NITC/DRIC, and there is no need for the NITC/DRIC.

The failure to recognize current and more updated traffic information showing lower traffic

levels must, in turn, have resulted in a violation of NEPA, which demands that decision-makers

reach final judgments only after they have understood the benefits to be achieved given a

project’s environmental consequences. An analysis that overestimates the benefits for a given

environmental impact that the NITC/DRIC bridge will impose necessarily skews that

assessment: with no traffic justification for the NITC/DRIC, and hence by definition “fewer”

(i.e., no) benefits from the proposed new bridge, it is much more likely that the environmental


84

costs of building the NITC/DRIC would not be considered worthwhile to incur. The State

Department’s approach prevented it from engaging in the required, reasoned decision-making.

277. Thus, despite the legal infirmities in the Crossing Agreement and the inadequate

factual presentation contained in the NITC/DRIC Application, the State Department granted

approval to the Crossing Agreement and issued the Presidential Permit.

G. Violation Of Plaintiffs’ Equal Protection Rights

278. As described above, the U.S. defendants have engaged in a consistent and

repeated pattern of conduct that discriminates against the privately-owned New Span in favor of

the government-owned NITC/DRIC, which the U.S. defendants have sought to promote while

attempting to slow down and prevent the construction of the New Span. Such discriminatory

actions include (but are not limited to) (a) the concerted effort by all defendants for more than a

decade to build the government-owned new span (i.e., the NITC/DRIC), and to prevent plaintiffs

from exercising their right to build their New Span; (b) the Coast Guard’s refusal for the past

eight years to grant a navigational permit for the New Span, without any valid justification or

legal basis for that refusal, thereby preventing plaintiffs from exercising their statutory right to

build the New Span during the period that the government-owned NITC/DRIC sought to obtain

its approvals in advance of the previously-authorized New Span; (c) the Coast Guard’s decision

to delay and refuse to finalize its NEPA review of the New Span, even as the FHWA accelerated

the NEPA approvals for the NITC/DRIC; (d) the State Department’s decision to grant the

NITC/DRIC a Presidential permit (which the State Department was aware would eviscerate

plaintiffs’ right to build the New Span), despite the fact that the Crossing Agreement violates

Michigan law, despite the fact that the NITC/DRIC Application relies on inaccurate and outdated

traffic projections, and despite the fact that the NITC/DRIC fails even to attempt to demonstrate

that the NITC/DRIC is needed over and above the New Span (which it clearly is not). Indeed,


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defendants have acknowledged that there is no need for both plaintiffs’ privately-owned New

Span and the government-owned NITC/DRIC. Thus, by discriminating against the approval of

the plaintiffs’ New Span and in favor of the accelerated approval of the government-owned

NITC/DRIC, the defendants have effectively sought to deny plaintiffs their ability to exercise

their statutory right to build the New Span.

279. These discriminatory actions are neither narrowly tailored to serve a compelling

government interest, nor substantially related to an important government interest, nor

reasonably related to a legitimate government interest. They are unconstitutional under the

Equal Protection Clause of the Fourteenth Amendment, made applicable to the United States

federal government through the Fifth Amendment.

280. When government entities enter into commerce in order to compete with

privately-owned entities, they must compete on a level playing field, subject to equal treatment

guaranteed by the Equal Protection Clause. There is no rational basis for the government to

discriminate in favor of a government-owned commercial venture such as the NITC/DRIC, and

against a privately-owned venture like the New Span. By discriminating against the privately-

owned New Span and in favor of the government-owned NITC/DRIC, the U.S. defendants have

violated DIBC’s rights under the Equal Protection Clause.

281. There also can be no rational basis for discriminating against a private entity that

has already received Congressional approval for its bridge, and in favor of government entities

that have not received Congressional approval for their competing bridge. Thwarting the will of

Congress cannot be a rational basis for discriminating against a private party and in favor of

government agencies. Thus, there is no rational basis for the U.S. defendants to have

consistently discriminated in favor of a potential government-owned bridge that was never given


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Congressional authorization (the NITC/DRIC), and against a privately-owned bridge that was

already in existence, and that already has a longstanding Congressional authorization, including

for the construction of its planned New Span. Indeed, this discrimination is especially irrational

and unjustified because Congress has appropriated substantial sums of money to improve the

highway connections to the Ambassador Bridge, expressly in order to promote and protect the

plans for the New Span to the Ambassador Bridge.

282. There likewise was no rational basis for the U.S. defendants to have purposely

eliminated consideration of the privately-owned New Span in its alleged consideration of all

alternatives to the NITC/DRIC, as required by NEPA. In particular, there was no rational basis

for the U.S. defendants to have eliminated the New Span from consideration given that it had no

environmental impact and hence was environmentally preferable to the NITC/DRIC, which will

displace approximately 257 private hiomes, 43 businesses, and 9 churches and non-profits. The

New Span was eliminated from consideration solely because of an irrational desire to favor a

government-owned bridge rather than a privately-owned bridge, in breach of the statute

authorizing the privately-owned bridge.

283. There is likewise no rational basis for the U.S. defendants to have deliberately

delayed the grant of a Coast Guard navigational permit to the Ambassador Bridge New Span in

order to allow the NITC/DRIC to receive its necessary approvals first, permitting its construction

to overtake the New Span’s.

284. There is likewise no rational basis for the U.S. defendants to further the efforts of

Canada and the governor of Michigan to enter into commercial competition with plaintiffs by

promoting their publicly-owned bridge to compete with plaintiffs’ privately-owned bridge.


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285. Thus, the actions taken by the U.S. defendants to discriminate against the New

Span and in favor of the NITC/DRIC violate plaintiffs’ rights under the Equal Protection Clause.

H. Defendants’ Conduct Is Causing Irreparable Harm To Plaintiffs.

286. Plaintiffs have been damaged by the violations of their rights set forth in each of

the claims described below in this Third Amended Complaint.

287. Plaintiffs have no adequate remedy at law for each of the claims set forth in this

Third Amended Complaint and will suffer irreparable harm if injunctive relief is not granted.

Money damages would be inadequate, as plaintiffs’ perpetual franchise to own and operate the

Ambassador Bridge and to build the New Span constitutes unique and irreplaceable property

rights.

288. In particular, the fact that the State Department issued a Presidential permit to the

NITC/DRIC and granted its purported approval to the Crossing Agreement causes immediate

and irreparable harm to plaintiffs. By proceeding to assert jurisdiction over the NITC/DRIC

Application and the Crossing Agreement, the State Department is supporting and giving

credence to the efforts of other agencies to delay and defeat plaintiffs’ right to build the New

Span. As alleged above, both the Coast Guard and Canadian authorities have demonstrated a

refusal and unwillingness to process even ministerial applications relating to the New Span,

which reflects, at least in part, their effort to promote the NITC/DRIC instead of the New Span.

If it were clear that the NITC/DRIC Application could not be granted by the State Department,

and that the Crossing Agreement was both unconstitutional and illegal, it would not be possible

for the Coast Guard and Canadian regulatory authorities to continue to delay and obstruct

plaintiffs’ longstanding efforts to obtain what should be non-controversial approvals for the New

Span.


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COUNT ONE

Violation of Foreign Compact Clause; Invalidity of Crossing Agreement: Declaratory and Injunctive Relief – United States Department of State and Secretary of State

289. The allegations of the preceding paragraphs are incorporated by reference as if

fully set forth herein.

290. Article 1, § 10, clause 3 of the United States Constitution provides that “No State

shall, without the consent of Congress . . . enter into any agreement or compact with any other

state, or with a foreign power . . . .”

291. In the IBA, Congress provided its consent “for a State . . . to enter into agreements

(1) with the Government of Canada, a Canadian Province, or a subdivision or instrumentality of

either, in the case of a bridge connecting the United States and Canada . . . for the construction,

operation, or maintenance of such bridge in accordance with the applicable provisions of this

subchapter. The effectiveness of such agreement shall be conditioned on its approval by the

Secretary of State.” This constitutes an attempted or purported delegation of Congress’s Article

1, § 10 power.

292. The IBA does not provide an intelligible principle for the State Department to

apply in deciding whether to approve an agreement entered into between a State and a foreign

country.

293. The State Department admits that the 1972 International Bridge Act “does not set

forth a particular standard but rather provides broad discretion to the Secretary of State in

considering whether to approve an agreement between a U.S. state and the government of either

Canada or Mexico.”

294. Thus, because the IBA fails to provide an intelligible principle for the Secretary of

State to apply in determining how to exercise the Congressional power to approve agreements


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between States and foreign countries, it is an unconstitutional delegation of that Congressional

power and responsibility. Accordingly, the IBA’s delegation should be declared unconstitutional

and invalid.

295. In addition, the IBA fails to provide the Secretary of State with an intelligible

principle to apply in determining whether to approve agreements between a State and a foreign

power that will directly infringe upon a franchise previously granted by Congress, such as the

franchise conferred upon plaintiffs. Moreover, the IBA does not provide the Secretary of State

with the legal authority (let alone any intelligible principle to apply) to approve an agreement

between agents of a State and a foreign power if the State legislature has prohibited those State

agents from entering into any such agreement. Thus, alternatively and at a minimum, the IBA

fails to constitutionally delegate the power to approve agreements between a State and a foreign

power under the circumstances of this particular case.

296. Because the Crossing Agreement has been entered into between agents of the

State of Michigan and the Government of Canada, and because it may not lawfully be approved

by the Secretary of State and has not been approved by Congress as required by Article I, § 10,

clause 3, the Crossing Agreement should be declared to be an invalid, void, and unenforceable

agreement.

297. Because the State Department does not have the constitutional authority to

approve the Crossing Agreement, the State Department’s approval should be declared invalid,

unlawful, and unenforceable, and the State Department should be enjoined from any further

consideration of any subsequent submission of any NITC/DRIC application that relies on the

Crossing Agreement or any similar agreement.

COUNT TWO


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Declaratory Judgment Regarding DIBC’s and CTC’s Franchise Rights; Injunction Against Violating Those Rights – All Defendants



299. Plaintiffs have an “actual controversy,” as required by 28 U.S.C. § 2201.

Defendant Canada is seeking to build the NITC/DRIC, which plaintiffs allege violates their

franchise rights. Defendants FHWA and Coast Guard have been assisting Canada in its effort to

build the NITC/DRIC, and thereby to violate plaintiffs’ franchise rights, by accelerating the

regulatory approvals of the NITC/DRIC and delaying the regulatory approvals of the New Span.

Defendant State Department is assisting Canada in its efforts to build the NITC/DRIC, and

thereby to violate plaintiffs’ franchise rights, by willingly considering the approval of the

NITC/DRIC Application and the illegal Crossing Agreement, despite the lack of constitutional

authority to do so and despite the legal impediments to granting such approval, and by purporting

to grant both such approvals. All of the foregoing efforts to construct and approve the

NITC/DRIC are in violation of plaintiffs’ statutory and contractual franchise rights.

300. This actual controversy is within the jurisdiction of this Court, as required by 28

U.S.C. § 2201.

301. The 1909 Boundary Waters Treaty provided that any new uses, obstructions, or

diversions of boundary waters between the United States and Canada would require the approval

of an International Joint Commission, except where authorized by a “special agreement,” either

in the form of an agreement between the United States and Great Britain or through “concurrent

or reciprocal” legislation by the United States Congress and the Canadian Parliament.

302. Pursuant to the 1909 Boundary Waters Treaty, the United States Congress and the

Canadian Parliament enacted concurrent and reciprocal legislation granting plaintiffs a statutory


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franchise right to construct, maintain, and operate an international bridge between Detroit and

Windsor.

303. Due to the reciprocal nature of this Special Agreement, plaintiffs’ rights under the

agreement are reciprocal as between the United States and Canada.

304. Under Canadian law, plaintiffs’ statutory and contractual franchise rights under

the special agreement are exclusive, and cannot be subjected to any new bridge that would

constitute contiguous or injurious competition or interference with plaintiffs’ franchise.

305. Thus, plaintiffs have an exclusive statutory and contractual franchise right in both

the United States and Canada to construct, maintain, and operate an international bridge between

Detroit and Windsor. Plaintiffs’ franchise rights are enforceable against both the United States

defendants and against Canada because the franchise was created by reciprocal legislation

enacted by the United States Congress and Canadian Parliament, and therefore is enforceable

both as a matter of U.S. law (against U.S. government defendants) and as a matter of Canadian

law (against Canadian government defendants).

306. The United States and Canada have never enacted concurrent or reciprocal

legislation constituting a special agreement under the 1909 Boundary Waters Treaty that grants

franchise rights to an entity other than plaintiffs to construct, maintain, and operate an

international bridge between Detroit and Windsor.

307. The 1972 International Bridge Act (“IBA”) enacted by the United States and the

2007 International Bridge and Tunnel Act (“IBTA”) enacted by Canada are not concurrent or

reciprocal legislation constituting a special agreement under the Boundary Waters Treaty.

308. Moreover, the 1972 IBA does not authorize the approval of any bridge (or any

international agreement relating to any bridge) that would interfere with the plaintiffs’ statutory


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and contractual franchise rights to operate the bridge crossing between Detroit and Windsor.

The 1972 IBA does not make any reference to the Detroit-Windsor crossing. Instead, it is an act

of general application that simply purports to alter the process for obtaining international bridge

approvals, moving the approval authority from Congress to the State Department. In making this

procedural change, however, Congress made clear that it did not intend for the IBA to be

interpreted to adversely affect the rights of bridge owners who owned bridges that were approved

and built prior to the construction of the IBA. In addition, in the event of any potential conflict

between the general IBA (which makes no reference to the Detroit-Windsor crossing) and the

specific statutory franchise granted to plaintiffs for the Detroit-Windsor crossing, the specific

statutory franchise granted to plaintiffs must govern. Based on established canons of

construction, the IBA also cannot be interpreted to constitute an “implied repeal” or “implied

modification” of the 1921 DIBC Act conferring on plaintiffs their statutory franchise. This is

especially true here, because the plaintiffs’ statutory and contractual franchise was conferred

pursuant to a treaty (the Boundary Waters Treaty), and therefore cannot be unilaterally modified

without violating that Treaty. For all of these reasons, the IBA cannot be construed to adversely

impact the rights of plaintiffs, and the IBA therefore does not authorize the approval of any

bridge between Detroit and Windsor, which would necessarily interfere with plaintiffs’ statutory

and contractual franchise conferred by the DIBC Act and the CTC Act. In order for another

bridge to be approved for the Detroit-Windsor crossing, at a minimum there needs to be express

and specific legislation from Congress modifying plaintiffs’ statutory franchise, which Congress

has not enacted.

309. The Executive Branch has implicitly admitted that, notwithstanding the IBA,

certain bridge crossings, such as those which interfered with existing franchise rights such as


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plaintiffs, require additional Congressional authorization, and are not approved by the IBA. This

can be seen, for example, in Executive Order 13,337, which was promulgated in 2004, long after

the 1972 enactment of the IBA, and which authorizes the Secretary of State to approve

applications for new international bridges only “to the extent that congressional authorization is

not required.” This phrase would have been meaningless to include unless there were certain

bridge crossings, such as the Detroit-Windsor crossing, for which existing Congressionally-

granted franchises already existed, and for which no new franchise could be lawfully granted

without, at a minimum, new legislation from Congress.

310. In addition, the IBA cannot be construed to approve a contract governed by state

law that would trump the plaintiffs’ rights under the federal statute conferring their franchise,

especially when that contract was entered into by agents of a State with a foreign government in

violation of that State’s express legislation, as occurred here.

311. Furthermore, the precise location for the Ambassador Bridge was selected by

Congress and the War Department, not by plaintiffs. Plaintiffs were given the franchise to build

the Detroit-Windsor bridge, but the federal Government determined precisely where that bridge

would be constructed. Similarly, over approximately the past 15 years, Congress has

appropriated funds to improve the highway connections to the Ambassador Bridge. In the course

of doing so, Congress has stated that its appropriations are intended to accommodate and protect

the plaintiffs’ plans to develop their New Span at the same location as the existing Ambassador

Bridge, and thereby led plaintiffs to believe that the New Span would be located at that same

location. By approving the construction of a different new span two miles away, the Defendants

are, in effect, seeking to relocate plaintiffs’ statutory and contractual franchise to a new location


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and to new ownership. This violates plaintiffs’ franchise rights, and should be declared unlawful

and invalid.

312. Based on all of the foregoing, Plaintiffs therefore seek a declaratory judgment that

(a) plaintiffs possess a statutory and contractual franchise right to operate an international bridge

between Detroit and Windsor under concurrent and reciprocal United States and Canadian

legislation that constitutes a Special Agreement under the 1909 Boundary Waters Treaty; (b) that

franchise right is exclusive of all contiguous and injurious competition in the form of any other

bridge between Detroit and Windsor; (c) in the alternative, and at a minimum, that franchise

right is exclusive of any other bridge being built between Detroit and Windsor unless and until

the United States Congress and the Canadian Parliament enact concurrent or reciprocal

legislation constituting a special agreement under the 1909 Boundary Waters Treaty that grants a

franchise right to another entity to construct, maintain, and operate an additional international

bridge between Detroit and Windsor; (d) that franchise right is a perpetual right that prohibits the

government as grantor from building a bridge that would divert toll revenues from DIBC,

especially given that DIBC has taken reasonable steps to build a new bridge span itself between

Detroit and Windsor; (e) the United States Congress and the Canadian Parliament have never

enacted such additional concurrent or reciprocal legislation constituting a special agreement

under the 1909 Boundary Waters Treaty; (f) the 1972 IBA cannot be construed to authorize any

approval of another bridge between Detroit and Windsor; and (g) therefore no entity other than

plaintiffs may construct, maintain, and operate an international bridge between Detroit and

Windsor.


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313. Plaintiffs also seek injunctive relief enjoining all defendants from taking any

action that infringes upon plaintiffs’ exclusive statutory and contractual franchise rights under

their Special Agreement.

COUNT THREE

Declaratory Judgment of DIBC’s Franchise Right to Build the New Span to the Ambassador Bridge; Injunction Against Violating That Right – All Defendants



315. As alleged above, Plaintiffs have an “actual controversy,” as required by 28

U.S.C. § 2201.

316. This actual controversy is within the jurisdiction of this Court, as required by 28

U.S.C. § 2201.

317. As alleged above, for over 80 years, pursuant to express legislation enacted by the

United States Congress and the Canadian Parliament, plaintiffs have been the exclusive owners

of the statutory and contractual franchise to construct, maintain, and operate the international

bridge crossing between Detroit and Windsor.

318. As Congress recognized when enacting the IBA, that new legislation “should not

be construed to adversely affect the rights of those operating bridges previously authorized by

Congress to repair, replace or enlarge existing bridges.” H.R. Rep. No. 92-1303.

319. In an August 3, 2005 letter, the State Department acknowledged that DIBC’s

existing franchise included the right to build the Ambassador Bridge New Span: “the

replacement or expansion of existing bridges authorized by Congress prior to passage of the

1972 International Bridge Act did not require a Presidential permit,” and therefore, because


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“DIBC is only seeking to expand (or twin) the operation of the bridge . . . DIBC does not require

a Presidential permit.”

320. Therefore, the United States has recognized that included in plaintiffs’ statutory

and contractual franchise is the right to expand or twin the Ambassador Bridge by building the

New Span.

321. Plaintiffs’ statutory and contractual right to build the New Span is subject only to

generally applicable regulatory requirements, such as those relating to navigation and

environmental regulations. Plaintiffs’ statutory and contractual right to build the New Span is

not subject to any purely discretionary decision of the United States or Canadian Government.

In particular, plaintiffs’ franchise right to build the New Span is not subject to a judgment of

either the United States or the Canadian Government as to whether or not they would prefer to

have a government-owned bridge built instead of the New Span. Plaintiffs’ franchise rights are

enforceable against both the United States defendants and against Canada because the franchise

was created by reciprocal legislation enacted by the United States Congress and Canadian

Parliament, and therefore is enforceable both as a matter of U.S. law (against U.S. government

defendants) and as a matter of Canadian law (against Canadian government defendants).

322. The agencies and officers of the United States and Canada may not take any

actions designed to frustrate or defeat plaintiffs’ right to build the New Span. In particular, the

agencies and officers of the United States and Canada may not seek to accelerate the regulatory

approvals for the NITC/DRIC and/or to delay the regulatory approvals of the New Span in an

effort to defeat or frustrate plaintiffs’ ability to exercise their right to build the New Span.

323. Plaintiffs therefore seek a declaratory judgment that (a) plaintiffs possess a

statutory and contractual franchise right to build the New Span; (b) the agencies and officers of


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the United States and Canada may not frustrate or defeat plaintiffs’ franchise right to build the

New Span and are preempted from doing so; (c) the agencies and officers of the United States

and Canada may not discriminate in favor of the NITC/DRIC over the New Span, and may not

accelerate the regulatory approvals for the NITC/DRIC and/or delay the regulatory approvals for

the New Span; (d) in addition to complying with all of plaintiffs’ franchise rights as outlined in

Count Two, and irrespective of the exclusive nature of those rights as claimed in Count Two, the

agencies and officers of the United States and Canada may not approve the NITC/DRIC unless

they are able to demonstrate that the NITC/DRIC is necessary even after construction by

plaintiffs of the New Span.

324. Plaintiffs also seek injunctive relief to protect and enforce their franchise right to

build the New Span, including by enjoining (a) the State Department to set aside as unlawful its

approval of the NITC/DRIC Application and the Crossing Agreement, both of which failed even

to attempt to demonstrate the need to build the NITC/DRIC in addition to the New Span; (b) the

FHWA from taking any further action to approve the NITC/DRIC unless and until the New Span

has been fully approved, and unless and until the NITC/DRIC satisfies all regulatory

requirements based on the assumption that the New Span will be constructed first; and (b) the

Coast Guard from any further delay in granting DIBC its navigational permit under the 1906

Bridge Act, and mandating that the Coast Guard promptly issue that navigational permit.

COUNT FOUR

APA Claims – Coast Guard Defendants



326. The Coast Guard has refused to process and has returned the Ambassador

Bridge’s application for a permit and a FONSI for the Ambassador Bridge New Span for


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improper reasons. Among other things, the Coast Guard has relied on opposition from Canadian

officials and the FHWA rather than the statutory criteria for issuing a permit to build the bridge

under the 1906 Bridges Act, or for issuing a FONSI under NEPA, and has improperly insisted

that DIBC resolve all land use disputes before proceeding, in contravention of the explicit orders

of this Court.

327. The Coast Guard’s refusal to further process and grant DIBC’s application, and its

rejection and return of that application to DIBC constitutes final agency action denying that

application under 5 U.S.C. §§ 701-706, and is in violation of the standards set forth in 5 U.S.C §

706(2).

328. The Coast Guard has no legitimate reasons for denying or delaying a FONSI for

the Ambassador Bridge New Span.

329. Alternatively, the Coast Guard has unlawfully withheld or unreasonably delayed

agency action under 5 U.S.C. § 706(1).

330. Such actions by the Coast Guard have also breached plaintiffs’ exclusive statutory

and contractual rights.

331. Further, for the reasons detailed above, the actions and decisions of the Coast

Guard in failing or refusing to issue a FONSI or a 1906 Bridges Act permit are (a) arbitrary,

capricious, an abuse of discretion, or otherwise not in accordance with law; (b) contrary to

constitutional right, power, privilege, or immunity; (c) in excess of statutory jurisdiction,

authority, or limitations, or short of statutory right; (d) without observance of procedure required

by law, and/or (e) unsupported by substantial evidence or unwarranted by the facts.

COUNT FIVE

Declaratory Judgment of Uncompensated Taking of Private Property - All U.S. Defendants


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333. The plaintiffs own a statutory and contractual franchise to construct, maintain,

and operate the Ambassador Bridge and to build a New Span to the Ambassador Bridge.

334. The franchise rights owned by the plaintiffs constitute private property protected

by the Takings Clause and Due Process Clause of the Fifth Amendment to the Constitution, and

by international law.

335. The U.S. defendants are currently taking actions that will destroy and appropriate

the economic value of plaintiffs’ franchise rights without payment of just compensation to

plaintiffs. In particular, the U.S. defendants have been assisting Canada in its effort to construct

the NITC/DRIC in contravention of the United States Constitution, United States statutes,

Congressional policy, and plaintiffs’ franchise rights. In addition, the U.S. defendants (and

Canada) have favored the construction of the NITC/DRIC over the construction of the New

Span, have discriminated in favor of the NITC/DRIC and against the New Span, and have

attempted and continue to attempt to accelerate the regulatory approvals of the NITC/DRIC and

to delay the regulatory approvals of the New Span – all in an effort to destroy and defeat

plaintiffs’ ability to exercise their franchise right to build the New Span.

336. Over the past decade, plaintiffs have invested millions of dollars based on the

reasonable expectation that they were the exclusive owners of the franchise to own and operate

an international bridge between Detroit and Windsor, and based on the reasonable expectation

that their rights included the right to build the New Span. Plaintiffs reasonably believed that the

U.S. defendants would not attempt to frustrate and destroy those rights by attempting to favor the

construction of the NITC/DRIC over the construction of the New Span.


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337. In addition, plaintiffs relied on the fact that the U.S. Congress had appropriated

money to improve the highway connections to the Ambassador Bridge in order to

“accommodate” and “protect” plaintiffs’ right to build the New Span to the Ambassador Bridge.

Indeed, plaintiffs spent millions of dollars in reliance to improve their portions of the approaches

and connections to the Ambassador Bridge, and to prepare for the New Span, based upon this

Congressional assurance that the highways would be improved in order to accommodate the

New Span at that location (i.e., right next to the existing Ambassador Bridge). Moreover,

plaintiffs also relied to their detriment on this Congressional directive by discontinuing

investments they had been making to acquire land located at other potential crossing points

between Detroit and Windsor (including that which was later selected for the NITC/DRIC),

which plaintiffs had previously started to acquire to ensure their ability to locate their New Span

in whatever alternative location might prove most appropriate. By appropriating money to

improve the highways to the Ambassador Bridge in order to accommodate and protect the New

Span at the location of the existing Ambassador Bridge, Congress induced plaintiffs to rely, to

their significant financial detriment, upon the New Span being located right next to the existing

Ambassador Bridge. The State Department’s approval of the NITC/DRIC at a different location,

and the defendants’ overall effort to block the New Span and to approve and construct the

NITC/DRIC, destroys plaintiffs’ reasonable, investment-backed expectations.

338. Accordingly, plaintiffs seek a declaratory judgment that under the Takings Clause

of the Fifth Amendment, the conduct of the United States that supports the construction of the

NITC/DRIC, and/or that seeks to defeat the ability of plaintiffs to build the New Span by

accelerating the approval of the NITC/DRIC, constitutes a taking of plaintiffs’ franchise rights

without payment of just compensation.


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339. In addition, the United States defendants are attempting to appropriate plaintiffs’

private property – i.e., the Congressionally-conferred right to build the New Span -- in order to

convey that property to other parties engaged in a competing commercial venture – i.e., the

Canadian defendants and other NITC/DRIC proponents. It is well-settled that the Government

may not take property from one private party in order to convey it to another party for a non-

public purpose, and that any such taking of property should be enjoined under the Fifth

Amendment. Accordingly, plaintiffs seek to enjoin the uncompensated and unlawful taking of

their private property.

COUNT SIX

APA Claims Based On Issuance Of Presidential Permit – State Department Defendants



341. The State Department’s decision to grant a Presidential permit for the

NITC/DRIC was contrary to law, arbitrary and capricious, in excess of statutory authority, and

otherwise in violation of the standards set forth in 5 U.S.C. § 706(2).

342. First, the 1972 IBA cannot lawfully be construed to authorize the State

Department to approve a new bridge between Detroit and Windsor. Any such bridge would

constitute a violation of plaintiffs’ statutory and contractual franchise rights, as alleged in Count

Two, above. At a minimum, any such new bridge requires express and specific legislation from

Congress specifically authorizing a new bridge between Detroit and Windsor, and expressly

modifying plaintiffs’ franchise rights. No such legislation exists. Executive Order 13,337

expressly refrained from delegating to the Secretary of State the power to approve any bridge

that required Congressional authorization, and therefore did not delegate the power to approve a

new bridge between Detroit and Windsor.


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343. Second, the issuance of the Presidential Permit directly violates the statutory

franchise rights of DIBC to build the New Span to the Ambassador bridge. Both Congress and

the State Department have recognized that DIBC’s federal statutory franchise includes the right

to build the New Span. That right is inherent in DIBC’s statutory right to maintain its franchise

without any time limit. Thus, in enacting the 1972 IBA, Congress made clear in its legislative

report that the IBA “should not be construed to adversely affect the rights of those operating

bridges previously authorized by Congress to repair, replace or enlarge existing bridges.”

Similarly, the State Department confirmed for DIBC in 2005 that DIBC had the right to

“expand” and/or “twin” the Ambassador Bridge by building its New Span without having to seek

a Presidential permit that would be required of any new bridge under the IBA. DIBC has made

clear for over a decade that it intends to expand as necessary to facilitate all traffic, including by

building that New Span. But the proponents of the NITC/DRIC know that if the NITC/DRIC is

constructed first, it will be economically impossible for DIBC to finance, build, and operate the

New Span. In essence, there is no need for any new bridge crossing between Detroit and

Windsor beyond, at most, the plaintiffs’ proposed New Span (which is needed for modernization

reasons, not increased traffic reasons), and the construction of the NITC/DRIC therefore destroys

DIBC’s right to build the New Span. That is why the NITC/DRIC proponents made absolutely

no effort to demonstrate that the NITC/DRIC was needed in addition to the New Span. By

granting a Presidential Permit to the NITC/DRIC despite the absence of any evidence that it was

needed in addition to the New Span, and despite full knowledge that it would eviscerate DIBC’s

ability to exercise its right to build the New Span and eviscerate DIBC’s right to continue to

build new spans in addition to the New Span when and if needed, the State Department violated


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DIBC’s federal statutory franchise rights, and thereby acted contrary to law, arbitrarily and

capriciously, and in violation of all of the standards set forth in 5 U.S.C. §706(2).

344. Third, section 4 of the IBA provides that in determining whether to approve a

proposed international bridge, the President shall secure the advice and recommendations of the

heads of various departments and agencies of the Federal Government as the President “deems

appropriate to determine the necessity of such bridge.” 33 U.S.C. § 535b (emphasis added). The

Presidential Permit issued by the State Department for the NITC/DRIC makes no mention of

section 4 of the IBA, makes no mention of the need to find “necessity,” and makes no effort to

demonstrate that is any “necessity” for the proposed bridge. The Presidential Permit makes no

findings of necessity of any kind, nor any findings that could even indirectly support a finding of

necessity. Thus, unless the State Department admits and the Court concludes that there is no

standard or intelligible principle set forth in the IBA even for the President’s permitting power as

well as for its power to approve agreements between States and foreign countries, the

Presidential Permit is contrary to law, unauthorized, and in violation of all of the standards set

forth in 5 U.S.C. § 706(2).

345. Fourth, Article 14 of the Presidential Permit invokes the standard set forth in

Executive Order 11423, which calls for the Secretary of State to determine if issuance of a

permit for one of the proposed facilities covered by Executive Order 11423 “would serve the

national interest.” [Executive Order 11423 at §1(d)]. In addition, when the State Department

published a notice in the Federal Register of its receipt of the NITC/DRIC Application on July

11, 2012, the State Department stated that “Under E.O. 11423, the Department has the

responsibility to determine, taking into account input from these agencies and other stakeholders,

whether issuance of a Presidential permit for this proposed bridge would be in the U.S. national


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interest.” Thus, the Presidential Permit for the NITC/DRIC reflects the application of the 1968

Executive Order’s “national interest” standard rather than the “necessity” standard required by

Congress in section 4 of the 1972 IBA. The Presidential Permit for the NITC/DRIC therefore

reflects the application of the incorrect legal standard, and is contrary to law, unauthorized, and

in violation of all of the standards set forth in 5 U.S.C. § 706(2).

346. Fifth, the State Department acted contrary to law in issuing the Presidential

Permit for the NITC/DRIC because the special agreement between the United States and Canada

conferred exclusive rights on DIBC and CTC to operate the Ambassador Bridge. Congress has

never purported to nullify or amend those exclusive rights. Moreover, neither the U.S. nor

Canada has the right to unilaterally amend or nullify that special agreement. Thus, granting a

Presidential Permit to the NITC/DRIC violates plaintiffs’ franchise rights as reflected in the

reciprocal special agreement entered into by the United States, Canada, DIBC, and CTC, and

implemented by U.S. and Canadian statutes. It is therefore contrary to law and in violation of all

of the standards set forth in 5 U.S.C. § 706(2).

347. Sixth, the Presidential Permit for the NITC/DRIC is also contrary to law because

it has been issued in violation of the Boundary Waters Treaty. There has been no special

agreement between the High Contracting Parties of the Boundary Waters Treaty to allow a new

bridge to be built between Detroit and Windsor, and the Presidential Permit makes no finding

that any such special agreement exists. Thus, the NITC/DRIC is not in compliance with Articles

III and XIII of the Boundary Waters Treaty. Moreover, since plaintiffs’ statutory franchise rights

reflect, implement, and constitute a reciprocal agreement between the High Contracting Parties

to the Boundary Waters Treaty, the State Department’s violation of the Boundary Waters Treaty


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also violates plaintiffs’ statutory and contractual franchise rights. Accordingly, the Presidential

Permit violates the standards set forth in 5 U.S.C. § 706(2).

348. Seventh, the State Department also acted contrary to law by issuing the

Presidential Permit for the NITC/DRIC without fulfilling its obligations to conduct an

independent environmental analysis and assessment of purpose and need under NEPA. The

State Department failed to assess the new traffic data that undermined the alleged purpose and

need for the NITC/DRIC; failed to re-assess the environmental assessments of the FHWA, which

were more than four years old when the Presidential Permit was issued; held no public hearings;

and failed to conduct any independent analysis at all under NEPA. Its actions were therefore

contrary to law and in violation of the standards set forth in 5 U.S.C. § 706(2).

349. Eighth, the State Department also acted contrary to law by issuing the Presidential

Permit for the NITC/DRIC because the approval of the Presidential Permit depended upon the

approval of the Crossing Agreement, which the State Department could not and did not lawfully

approve for the reasons set forth below. This is therefore an additional reason the Presidential

Permit violates the standards set forth in 5 U.S.C. §706(2).

350. Ninth, there was no factual basis for any conclusion that there was a “necessity”

for the NITC/DRIC (nor even any purported finding of any such necessity, as alleged above), or

that the NITC/DRIC was in the national interest, or that there was any other justification for the

NITC/DRIC. Thus, under any applicable standard, the issuance of the Presidential Ppermit for

the NITC/DRIC was arbitrary and capricious, without factual support, and in violation of the

standards set forth in 5 U.S.C. § 706(2). In particular, the NITC/DRIC Application relied upon

outdated and inaccurate traffic projections for years in which there was actual data showing

traffic at far lower levels, and far too low to justify the construction of the NITC/DRIC. The


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State Department acted arbitrarily and capriciously in ignoring or overriding this data, and

violated the standards set forth in 5 U.S.C. § 706(2).

351. The State Department’s grant of the Presidential Permit to the NITC/DRIC

proponents constitutes final agency action under 5 U.S.C. §§ 701-706. The State Department’s

issuance of the Presidential Permit is reviewable under the APA because it was a final agency

action taken by an agency (i.e., the Department of State).

COUNT SEVEN

APA Claims Based On Approval Of Crossing Agreement – State Department Defendants



353. The State Department’s approval of the Crossing Agreement was in violation of

the standards set forth in 5 U.S.C. §706(2) because it was made pursuant to the IBA’s

unconstitutional delegation of power to approve agreements between a State and a foreign

country, and hence was an invalid approval.


the standards set forth in 5 U.S.C. §706(2) because the NITC/DRIC violates the plaintiffs’

statutory and contractual franchise rights, as outlined and alleged in Counts Two and Three,

above.


the standards set forth in 5 U.S.C. §706(2) because it seeks to approve the construction of a

bridge that will usurp plaintiffs’ statutory franchise right to build a New Span to the Ambassador

Bridge, and therefore violates both plaintiffs’ statutory franchise rights and the Congressionally-

stated limitation on the IBA, which Congress said shall not be construed to adversely impact the


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rights of owners of pre-existing bridges to repair, rebuild, or enlarge those bridges, such as

through construction of a new span.


the standards set forth in 5 U.S.C. §706(2) because it violates plaintiffs’ exclusive franchise right

to construct, maintain, and operate a bridge between Detroit and Windsor, and because it seeks to

approve the construction of a bridge that does not comply with the Boundary Waters Treaty.


the standards set forth in 5 U.S.C. §706(2) because it approved an agreement that was entered

into in violation of Michigan law. The Michigan legislature passed numerous statutes

prohibiting MDOT and MSF from executing any agreement relating to the NITC/DRIC, or from

expending any money relating to the NITC/DRIC without express approval from the Michigan

Legislature (which approval has never been given). In defiance of these prohibitions, MDOT

and MSF both executed the Crossing Agreement, and have spent funds promoting the Crossing

Agreement and the NITC/DRIC. In addition, the Governor of Michigan lacks the authority

under the Michigan constitution to enter into an agreement with a foreign state absent approval

or authorization from the Michigan Legislature, which has never been given; to the contrary, the

Michigan Legislature has made clear that it has not authorized the Michigan Executive Branch to

enter into any agreement relating to the NITC/DRIC. Thus, the Michigan Governor, MDOT, and

MSF executed the Crossing Agreement in violation of Michigan law. The State Department has

no power to approve an agreement entered into by State officials with a foreign government in

violation of that State’s law. Congress has never authorized the State Department to approve

such an illegal agreement, and any such authorization or approval violates the non-delegation

doctrine, the Tenth Amendment of the U.S. Constitution, and the Guaranty Clause set forth in


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Article IV, section 4 of the U.S. Constitution. It also violates the IBA, which requires an

application from a “State or a subdivision or instrumentality thereof,” which implicitly cannot

include the Governor or any state agency acting in violation of State law. Thus, the State

Department’s approval of the Crossing Agreement is contrary to law because it violates these

constitutional and statutory provisions and principles, and is contrary to our federal system as set

forth in the Constitution. Given the blatant illegality of the Crossing Agreement under Michigan

law, the State Department’s approval of the Crossing Agreement is also arbitrary and capricious

and in violation of the other standards set forth in 5 U.S.C. §706(2).


the standards set forth in 5 U.S.C. §706(2) because it relies on outdated and overstated traffic

projections and other erroneous data that fails to show that the NITC/DRIC is either necessary or

in the national interest. In particular, the NITC/DRIC Application failed to make any finding

that the NITC/DRIC was necessary and failed to make any effort to demonstrate that the

NITC/DRIC was necessary over and above the New Span, and therefore is based on a premise

that violates plaintiffs’ franchise rights and that fails to present the relevant data.

359. The State Department’s approval of the Crossing Agreement was also in violation

of the standards set forth in 5 U.S.C. §706(2) because the State Department failed to comply with

its obligations to conduct an independent review under NEPA, as alleged above. The State

Department’s approval of the Crossing Agreement was a separate federal agency action from the

issuance of the Presidential Permit for the NITRC/DRIC, and was equally lacking any

accompanying environmental analysis as to the action’s environmental impacts. It is thus

deficient under NEPA and the APA for the same reasons the State Department’s granting of the

Presidential Permit was deficient, as alleged above.


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360. The State Department’s approval of the Crossing Agreement was also in violation

of the standards set forth in 5 U.S.C. §706(2) because the Crossing Agreement grants

disproportionate power to Canada, and thereby fails to protect and serve the national interest.

361. For the reasons detailed above, the actions and decisions of the State Department

in approving the Crossing Agreement are (a) arbitrary, capricious, an abuse of discretion, or

otherwise not in accordance with law; (b) contrary to constitutional right, power, privilege, or

immunity; (c) in excess of statutory jurisdiction, authority, or limitations, or short of statutory

right; (d) without observance of procedure required by law, and/or (e) unsupported by substantial

evidence or unwarranted by the facts.

362. The State Department’s approval of the Crossing Agreement constitutes final

agency action under 5 U.S.C. §§ 701-706.

COUNT EIGHT

Judicial Review of Ultra Vires And Unlawful Action – State Department Defendants, Coast Guard Defendants, FHWA Defendants, and United States



364. Pursuant to 28 U.S.C. § 1331, 28 U.S.C. § 2201, and prior precedents of the

Supreme Court and the D.C. Circuit, this Court has the authority to declare that the State

Department and/or the United States acted contrary to law and beyond their authority in granting

the NITC/DRIC a Presidential permit and in approving the Crossing Agreement. This Court also

has authority to declare that because these approvals are contrary to law and ultra vires, they are

unenforceable, and no agency of the United States may implement them or rely upon their

validity in taking any other action.


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365. Furthermore, 5 U.S.C. § 703 provides that in the absence of special statutory

authorization for review, “the form of proceeding for judicial review” is “any applicable form of

legal action, including actions for declaratory judgments or writs of prohibition or mandatory

injunction or habeas corpus.”

366. Thus, even if and to the extent this Court accepts any claim by the State

Department that its actions in issuing a Presidential Permit for the NITC/DRIC and in approving

the Crossing Agreement are not reviewable under the APA (which they are), this Court

nonetheless has jurisdiction to declare such actions to be contrary to law, unenforceable, and

invalid, such that no agency may implement or rely upon those approvals.

367. As explained above, the State Department and/or the United States have acted

contrary to law and in excess of statutory authority by issuing the Presidential Permit and by

approving the Crossing Agreement. The allegations set forth above that itemize the ways in

which the State Department’s conduct is contrary to law and unauthorized are incorporated

herein by reference.

368. By reason of the foregoing, the Court should declare the State Department

defendants and/or the United States’s actions to be unlawful, invalid, and unenforceable, and

should enjoin all defendants from implementing or relying upon such approvals.

369. Also by reason of the foregoing, the Court should enjoin the U.S. defendants from

taking any further steps based on such an illegal and ultra vires action, including the grant of any

navigational permit by the Coast Guard.

COUNT NINE

Equal Protection Claim – U.S. Defendants




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371. As described above, the U.S. defendants have engaged in a series of

discriminatory actions to favor the construction of the publicly-owned NITC/DRIC over the

construction of the privately-owned New Span. This discrimination has been based upon the

NITC/DRIC being publicly-owned and the New Span being privately-owned, which is not a

rational basis for such discrimination, especially in light of the fact that Congress has already

approved the private ownership of the Ambassador Bridge franchise, including in particular the

construction of a privately-owned New Span to the Ambassador Bridge. The U.S. defendants

have sought to discriminate against that privately-owned, Congressionally-approved New Span

by accelerating the approvals and construction of a government-owned new span instead.

372. The U.S. defendants know that there is no need for both the NITC/DRIC and the

New Span, and also know that the Congressional franchise granted to plaintiffs to construct,

maintain, and operate the Ambassador Bridge includes the right to build the New Span, which

plaintiffs have been actively pursuing for a decade. Nevertheless, instead of permitting plaintiffs

to build their New Span, the U.S. defendants, together with the Partnership, made a commitment

to their Canadian counterparts to ensure that the only new span built between Detroit and

Windsor would be the government-owned NITC/DRIC, not the privately-owned New Span to

the Ambassador Bridge. The defendants have therefore made a concerted effort to prevent

plaintiffs from exercising their right to build the New Span, and to discriminate in all relevant

regulatory approvals to favor the accelerated approvals of the NITC/DRIC and the delay and

obstruction of the privately-owned Ambassador Bridge New Span.

373. When government entities decide to enter into commerce to compete with private

entities, the Government as regulator is not entitled to discriminate in favor of the government-

owned commercial actor and against the privately-owned commercial actor. Such discrimination


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is especially unjustified when the privately-owned entity has a Congressional franchise that long

predates any federal governmental approval for the government-owned endeavor. Thus, the

defendants’ discrimination against the privately-owned, Congressionally-approved Ambassador

Bridge New Span and in favor of the government-owned NITC/DRIC new span is irrational and

unjust, and in violation of the Equal Protection Clause, made applicable to the Federal

Government through the Fifth Amendment.

PRAYER FOR RELIEF

WHEREFORE, plaintiffs respectfully request judgment against defendants as follows:

(a) A declaratory judgment declaring that the State Department defendants have acted

contrary to the standards set forth in 5 U.S.C. § 706(2) in granting the NITC/DRIC

proponents a Presidential Permit, and setting aside that Presidential Permit as invalid,

unlawful, void, and of no legal effect;

(b) A declaratory judgment declaring that the State Department defendants have acted

contrary to the standards set forth in 5 U.S.C. §706(2) in granting approval of the

Crossing Agreement, and setting aside that approval as invalid, unlawful, void, and of no

legal effect;

(c) An injunction requiring the State Department defendants to terminate the Presidential

Permit and revoke any and all approvals given to the NITC/DRIC or the Crossing

Agreement;

(d) A declaratory judgment against the Secretary of State and the State Department declaring

that the IBA does not constitutionally delegate to the Secretary of State the power to

approve the Crossing Agreement, and declaring the Crossing Agreement to be void and

unenforceable;


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(e) An injunction against all of the United States defendants precluding those defendants

from taking any further action based on any purported approval of the Crossing

Agreement;

(f) A declaratory judgment against the U.S. defendants that, under U.S. law, plaintiffs own

an exclusive franchise to own and operate an international bridge between Detroit and

Windsor; or, in the alternative, declaring that no additional bridge may be authorized

between Detroit and Windsor absent a special agreement under the Boundary Waters

Treaty authorizing such an additional bridge, and declaring that no such special

agreement currently exists;

(g) A declaratory judgment against the U.S. defendants that, under U.S. law, plaintiffs own

an exclusive franchise to own and operate an international bridge between Detroit and


between Detroit and Windsor absent express Congressional legislation specifically

authorizing a new bridge between Detroit and Windsor and expressly modifying the

plaintiffs’ statutory and contractual franchise;

(h) A declaratory judgment that the general 1972 IBA does not authorize the approval of any

new bridge between Detroit and Windsor and does not impliedly repeal or otherwise

modify plaintiffs’ statutory and contractual franchise rights to operate the Ambassador

Bridge and to build the New Span to the Ambassador Bridge;

(i) A declaratory judgment against Canada that, under Canadian law, plaintiffs own an

exclusive franchise to own and operate an international bridge between Detroit and


between Detroit and Windsor absent a special agreement under the Boundary Waters


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Treaty authorizing such an additional bridge, and declaring that no such special

agreement currently exists;

(j) An injunction against the Secretary of State and State Department precluding those

defendants from providing any purported future approvals of any aspect of the

NITC/DRICor any future NITC/DRIC application;

(k) A declaratory judgment against the U.S. defendants declaring that, under U.S. law,

plaintiffs own a statutory and contractual franchise right to build the New Span, and that

any conduct by any of the U.S. defendants that seeks to prevent plaintiffs from building

the New Span is a violation of those rights, including in particular any conduct that seeks

to accelerate the regulatory approvals of the NITC/DRIC and/or to delay the regulatory

approvals of the New Span, or otherwise to discriminate in favor of the NITC/DRIC and

against the New Span;

(l) A declaratory judgment against Canada declaring that, under Canadian law, plaintiffs

own a statutory and contractual franchise right to build the New Span, and that any

conduct by Canada that seeks to prevent plaintiffs from building the New Span is a

violation of those rights, including in particular any conduct that seeks to accelerate the

regulatory approvals of the NITC/DRIC and/or to delay the regulatory approvals of the

New Span, or otherwise to discriminate in favor of the NITC/DRIC and against the New

Span;

(m) As an alternative to the injunction requested in paragraph (f), an injunction against the

State Department and the Secretary of State precluding them from approving any future

NITC/DRIC Application unless and until such application is able to demonstrate that the

NITC/DRIC is necessary even after the New Span is built;


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(n) A declaratory judgment declaring that the Coast Guard defendants have acted contrary to

law and arbitrarily and capriciously in returning DIBC’s application for a navigational

permit under the 1906 Bridge Act to construct the New Span; or, in the alternative, a

judgment declaring that the Coast Guard defendants have unlawfully or unreasonably

withheld their decision on whether to issue a navigational permit to allow DIBC to

construct the New Span;

(o) An injunction requiring the Coast Guard to issue a navigational permit under the 1906

Bridge Act to allow DIBC to construct the New Span;

(p) An injunction preventing the FHWA from taking any further action to approve the

NITC/DRIC, or to construct, prepare for construction, or support construction of the

NITC/DRIC or its related approaches, unless and until the New Span has been fully

approved and unless and until the NITC/DRIC satisfies all regulatory requirements based

on the assumption that the New Span will be constructed first;

(q) A declaratory judgment that U.S. defendants’ actions in supporting the construction of

the NITC/DRIC, and in preventing plaintiffs from exercising their right to build the New

Span, constitute a taking of plaintiffs’ private property rights without payment of just

compensation, in violation of the Takings Clause of the Fifth Amendment and of

international law;

(r) A declaratory judgment declaring that the U.S. defendants have violated plaintiffs’ rights

under the Equal Protection Clause and an injunction precluding them from taking any

further action to promote the NITC/DRIC and to discriminate against the New Span;


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(s) Any and all other injunctive relief necessary to prevent defendants from taking any action

that infringes upon plaintiffs’ exclusive statutory and contractual franchise rights under

their Special Agreement; and

(t) Any such other and further relief as may be just and proper.

Respectfully submitted,

_/s/ Hamish P.M. Hume_______________ Hamish P.M. Hume BOIES, SCHILLER & FLEXNER LLP 5301 Wisconsin Ave. NW, Suite 800 Washington, DC 20015 (202)-237-2727 (Telephone) (202) 237-6131 (Fax)

Counsel for Plaintiffs Detroit International Bridge Company and Canadian Transit Company

Dated: May 29, 2013


Documents

UNITED STATES DISTRICT COURT - MLive.commedia.mlive.com/news/detroit_impact/other/complaint.pdf · united states district court ... plaintiffs, -vs.- the united states department