A three-judge panel of the First U.S. Circuit Court of Appeals in Boston is due to hear arguments today in a suit alleging the federal government’s re-engineering of the Northeast groundfishery into a quasi commodity market trading in catch shares beginning in 2010 was illegally introduced by denying industry the referendum promised by federal law.

Led by the cities of New Bedford and Gloucester — and including industry groups and fishermen as far away as North Carolina — the plaintiffs filed suit immediately after the catch share system took effect, arguing the approach, pushed by NOAA Administrator Jane Lubchenco, met the statutory definition of a limited-access program with individual fishing quota.

The 2006 re-authorization of the Magnuson-Stevens Act included a provision insuring that industries not be drawn unwillingly into so-called LAPPS or IFQs, which use formulas to distribute catching rights — or catch shares — among fishermen and fishing companies who trade, lease, buy and sell among themselves while the dispossessed or marginalized in the allocation of the fishery disappear.

NOAA insists in its response that what it created for New England was a system that allowed fishermen to continue working the old way, if they wished, obviating the need for referendum.

Magnuson-Stevens requires a two-thirds majority vote of permit-holders within the existing fishery to unlock the gears that can transform traditional fisheries into catch share formats.

The groundfishery had most recently been governed by a system of effort controls, that limited fishermen’s days at sea, but gave all permit holders equal access to the resource, a mix of 20 in- and off-shore stocks.

But in June 2011, U.S. District Judge Rya Zobel granted Lubchenco and the government summary judgment, sweeping aside a complaint of many facets, including the argument that fishermen were owed a referendum without which their statutory and constitutional rights were violated.

Zobel conceded the government’s case for skipping the referendum was iffy.

“While it is a close call,” she wrote, “I do not find the agency’s conclusion that Amendment 16 implements neither a LAPP nor an ITQ, reached as part of the rule-making process, is manifestly contrary to statute.”