Courtney v. Smith, 00-4554.

• Decision Date: 23 July 2002
• Docket Number: No. 00-4554.,00-4554.
• Citation: 297 F.3d 455
• Parties: John M. COURTNEY, Larry E. Troutman, and Malcolm A. Webster, Plaintiffs-Appellants, v. David R. SMITH, Major General, Vice Commander of the HQAFRC/CV, Defendant-Appellee.
• Court: U.S. Court of Appeals — Sixth Circuit

297 F.3d 455

John M. COURTNEY, Larry E. Troutman, and Malcolm A. Webster, Plaintiffs-Appellants, v. David R. SMITH, Major General, Vice Commander of the HQAFRC/CV, Defendant-Appellee.

No. 00-4554.

United States Court of Appeals, Sixth Circuit.

Argued: May 2, 2002.

Decided and Filed: July 23, 2002.

COPYRIGHT MATERIAL OMITTED

Patrick J. Donlin (argued and briefed), Warren, OH, for Plaintiffs-Appellants.

Anthony J. Steinmeyer (briefed), Thomas M. Bondy (argued and briefed), United States Department of Justice, Civil Division, Appellate Section, Washington, DC, for Defendant-Appellee.

Before MERRITT, SUHRHEINRICH, and GILMAN, Circuit Judges.

GILMAN, J., delivered the opinion of the court, in which SUHRHEINRICH, J., joined. MERRITT, J., (pp. 467-68), delivered a separate dissenting opinion.

OPINION

GILMAN, Circuit Judge.

John M. Courtney, Larry E. Troutman, and Malcolm A. Webster brought suit against Major General David R. Smith, the Vice-Commander of the U.S. Air Force Reserve Command (AFRC), alleging that the federal government violated its internal policies and various laws by outsourcing certain work performed at the Youngstown-Warren Air Force Reserve Base to Griffin Services, Inc., a private contractor. According to the plaintiffs, all of whom worked at the Base prior to the government's decision, the government failed to perform the required cost comparison before granting the contract to Griffin, or made its decision based upon a faulty analysis.

The district court dismissed the complaint for lack of standing, concluding that the plaintiffs failed to demonstrate an injury in fact, one of the three prerequisites for constitutional standing. In addition, the district court determined that the plaintiffs lacked prudential standing because they were not within the "zone of interests" protected by the statutes under which they brought suit. For the reasons set forth below, we AFFIRM the judgment of the district court.

I. BACKGROUND

A. Factual background

The Base in question is located in Vienna, Ohio. A cost-comparison analysis of the work performed at the Base began in 1998. This action was initiated by the AFRC pursuant to the procedures set forth in Office of Management and Budget Circular No. A-76 (the Circular). The Circular requires that all commercial activities that are not inherently governmental in nature must be performed by private contractors unless one of several exceptions applies. At issue in the present case is the exception that directs the government to perform work in-house if a cost comparison "demonstrates that the Government is operating or can operate the activity on an ongoing basis at an estimated lower cost than a qualified commercial source." Executive Office of the President, OMB Circular A-76, para. 8(d) (Revised 1999). To comply with the periodic review mandated by the Circular, the AFRC's analysis sought to determine whether a private contractor could perform Base Operating Support Services (BOS) more economically than the federal employees who were doing the work on the Base.

The AFRC announced its decision to grant the BOS contract to Griffin in January of 2000. Within a month of the government's announcement, the union representing the Base's employees filed an appeal of the outsourcing decision with the AFRC. This internal appeal was made possible because of the Circular's requirement that agencies establish an administrative appeals procedure to resolve complaints by "federal employees... that have submitted formal bids or offers who would be affected by a tentative decision to convert to or from in-house, contract, or [Inter-Service Support Agreements] as a result of a cost comparison." OMB Circular A-76, Supp. Part I, Ch. 3, para. K(2)(b). The AFRC denied the union's appeal in March of 2000.

B. Procedural background

This lawsuit was filed in the United States District Court for the Northern District of Ohio in May of 2000. According to the plaintiffs' amended complaint, the government's decision to award the BOS contract to Griffin rather than to the in-house government employees violated (1) Circular A-76 and its accompanying Supplement, (2) The Budget and Accounting Act of 1921, ch. 18, 42 Stat. 20 (1921) (codified as amended in scattered sections of 31 U.S.C.), (3) the Office of Federal Procurement Policy Act Amendments of 1979, 41 U.S.C. §§ 403-36, (4) the Federal Activities Inventory Reform Act of 1998, 31 U.S.C. § 501 Note (Supp.2002), (5) various federal procurement statutes, 10 U.S.C. §§ 2304, 2461-63, 2467-69, and (6) the Administrative Procedure Act, 5 U.S.C. §§ 702, 706. All three plaintiffs were then working for the Vehicle Maintenance Group at the Base, one of the activities covered by the BOS contract.

The plaintiffs filed a motion for class certification in August of 2000, seeking to represent 93 similarly situated civilian employees at the Base. That same month, the government filed a motion to dismiss for lack of standing. The district court denied class certification in September of 2000 and dismissed the case for lack of standing approximately two months later. With respect to the defendants' motion, the court concluded that the plaintiffs were unable to establish the constitutional requirements for standing because their alleged injuries — the loss of their jobs — had not occurred and were only speculative, and because no guarantee existed that their jobs would have been preserved even if the BOS contract had remained in-house. The district court also determined that because the plaintiffs were not within the "zone of interests" intended to be protected by the statutes under which they had brought suit, they did not satisfy the prudential requirements of standing. This timely appeal followed.

II. ANALYSIS

A. Standard of review

We review de novo a district court's decision to dismiss a case for lack of standing. Am. Fed'n of Gov't Employees v. Clinton, 180 F.3d 727, 729 (6th Cir.1999). "For purposes of ruling on a motion to dismiss for lack of standing, a complaint must be viewed in the light most favorable to the plaintiff; all material allegations of the complaint must be accepted as true." Id. But the plaintiff, as the party invoking federal subject matter jurisdiction, has the burden of persuading the court that all of the requirements necessary to establish standing to bring the lawsuit have been met. Lujan v. Defenders of Wildlife, 504 U.S. 555, 561, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992) (explaining that the party invoking federal jurisdiction has the burden of establishing the three elements that constitute the "irreducible constitutional minimum of standing").

B. Constitutional standing

Article III of the United States Constitution limits the jurisdiction of federal courts to actual "Cases" and "Controversies." U.S. Const. art. III, § 2, cl. 1. To satisfy this "case-or-controversy" requirement, "a plaintiff must establish three elements: (1) an injury in fact that is concrete and particularized; (2) a connection between the injury and the conduct at issue—the injury must be fairly traceable to the defendant's action; and (3)[a] likelihood that the injury would be redressed by a favorable decision of the Court." Blachy v. Butcher, 221 F.3d 896, 909 (6th Cir.2000) (internal quotation marks omitted); Lujan, 504 U.S. at 560, 112 S.Ct. 2130 (noting that "the core component of standing is an essential and unchanging part of the case-or-controversy requirement").

The district court concluded that the plaintiffs failed to satisfy the injury-in-fact requirement because their alleged injuries — the loss of their jobs — had not actually occurred and were therefore only hypothetical. In reaching its decision, the court noted that federal regulations required Griffin to offer the plaintiffs, as federal employees, "the right of first refusal for employment openings under the contract in positions for which they are qualified...." 48 C.F.R. § 52.207-3(a). The district court also expressed its view that "even if the contract had been awarded to the in-house bidders, there is no guarantee that plaintiffs would not have been subject to a RIF [reduction in force] anyway." As a result, the court concluded that the plaintiffs were unable to establish the second and third requirements of Article III standing — causation and redressability.

In response, the plaintiffs argue that the district court failed to give effect to a supporting affidavit establishing that Courtney lost his job at the Base and had to accept a position at Tobyhanna Army Repair Depot in Pennsylvania, 350 miles east of the Base, in order to remain a federal employee. The affidavit specifies that Courtney's transfer led to his being separated from his family, all of whom remained in Ohio. Courtney was therefore forced to commute 700 miles round trip every weekend in order to see his family. Although these facts did not appear in the plaintiffs' complaint, the timely filed affidavit supports the proposition that at least one of the plaintiffs has standing to bring this lawsuit. Warth v. Seldin, 422 U.S. 490, 501, 95 S.Ct. 2197, 45 L.Ed.2d 343 (1975) (noting that "it is within the trial court's power to allow or to require the plaintiff to supply, by amendment to the complaint or by affidavits, further particularized allegations of fact deemed supportive of plaintiff's standing").

The affidavit does not discuss whether Courtney's new position had a lower salary or reduced benefits, so we are unable to determine whether his move resulted in any economic harm. Courtney's geographic separation from his family, and the associated inconvenience and expense of having to travel 700 miles each weekend to be with them, might be a sufficient injury to satisfy the first requirement of Article III standing. See Associated Builders & Contractors v. Perry, 16 F.3d 688, 691 (6th Cir.1994) (explaining that "a sufficient `injury in fact' can be alleged from a noneconomic or aesthetic harm")...