Lulac East Park v. U.S. Dept. Housing Urban Dev.
| Citation | 32 F.Supp.2d 418 |
| Decision Date | 16 December 1998 |
| Docket Number | No. CIV.A. SA-98-CA-814-PMA.,CIV.A. SA-98-CA-814-PMA. |
| Court | U.S. District Court — Western District of Texas |
| Parties | LULAC EAST PARK PLACE TRUST, Plaintiff, v. U.S. DEPARTMENT OF HOUSING & URBAN DEVELOPMENT, et Alia, Defendants. |
Ernest G. Valdez, San Antonio, TX, for Plaintiff.
William V. Cerbone, Jr., HUD, Fort Woth, TX, Karen B. Norris, U.S. Attys. Office for W.D. Tex., San Antonio, TX, for Defendants.
On September 10, 1998 plaintiff filed its complaint and request for issuance of a temporary injunction (docket no. 1). On November 6, 1998 plaintiff filed its first amended complaint (docket no. 25) alleging that: HUD breached its contract with plaintiff in violation of the Tucker Act; HUD procedures in deciding to foreclose violated due process; and HUD's decision to foreclose was arbitrary and capricious and an abuse of discretion in violation of the Administrative Procedure Act (APA).1 On December 3, 1998 a hearing was held on plaintiff's motion for preliminary injunction. As a threshold matter, the court invited arguments on jurisdiction. Plaintiff contended, in sum, that its claims are permissible challenges to agency action under the APA and that the Court otherwise has jurisdiction. The government argued, in sum, that all of plaintiff's claims essentially revolved around plaintiff's contract with HUD such that the entire case should be transferred to the U.S. Court of Federal Claims. At the conclusion of argument, the court announced its assessment that all contract-based claims should be dismissed without prejudice to plaintiff re-filing them in the U.S. Court of Federal Claims2 but that the Fourteenth Amendment and APA based claims reasonably could be considered to be separate from the contract such that those claims could proceed in this court. The court withheld its formal ruling pending the receipt of supplementary briefs on jurisdiction to be filed on December 14, 1998. Supplementary briefing allowed plaintiff an additional opportunity to address why a claim for injunctive relief based on the contract may be heard in this court and to allow the government to address why no claim should be considered in this court. The court continued the preliminary injunction hearing until December 17, 1998. This order is entered to address the question of jurisdiction following the review of the supplementary briefs and to define the scope of the December 17, 1998 hearing.
To sue the United States, plaintiff must establish that this Court has subject matter jurisdiction by demonstrating both a federal question under 28 U.S.C. § 1331 and a waiver of sovereign immunity. Federal question jurisdiction exists only for "civil actions arising under the Constitution, laws, or treaties of the United States." 28 U.S.C. § 1331. Even where a case is contractual in nature, the presence of issues requiring the interpretation of federal law and regulation give rise to a federal question. Katz v. Cisneros, 16 F.3d 1204, 1207 (Fed.Cir.1994). In this case, plaintiff alleges that HUD procedures for foreclosure violate due process and that HUD acted arbitrarily under the APA in ordering foreclosure. As a result, there is federal question jurisdiction under § 1331.
Plaintiff also must establish a valid waiver of sovereign immunity. Plaintiff contends that its claims are permissible challenges to agency action under the sovereign immunity waiver contained in the APA.
Section 702 of the APA creates no private right of action but is a broad consent to suit by the federal government in cases where the relief sought is for non-monetary damages:
A person suffering legal wrong because of agency action, or adversely affected or aggrieved by agency action within the meaning of a relevant statute, is entitled to judicial review thereof. An action in a court of the United States seeking relief other than money damages and stating a claim that an agency or an officer or employee thereof acted or failed to act in an official capacity or under color of legal authority shall not be dismissed....
5 U.S.C. § 702 (1998)(emphasis added).
The APA does not waive sovereign immunity in suits seeking money damages against the federal government. E.g., Warner v. Cox, 487 F.2d 1301 (5th Cir.1974). The APA does not authorize judicial review if another statute provides jurisdiction. Specifically, § 702 of the APA provides that "[n]othing herein, confers authority to grant relief if any other statute that grants consent to suit expressly or impliedly forbids the relief which is sought." Section 704 provides: "Agency action made review able by statute and final agency action for which there is no other adequate remedy in a court are subject to judicial review."
Whether § 702 of the APA justifies District or Magistrate Court jurisdiction depends on whether plaintiff's claims fall within any of the three limitations on the APA's waiver of sovereign immunity. As noted above, the APA excludes from its waiver of sovereign immunity: (1) claims for money damages; (2) claims for which an adequate remedy is available elsewhere; (3) claims seeking relief expressly or impliedly forbidden by another statute.
In this case, plaintiff in part seeks money damages from the United States founded on a government contract. The money damages sought could well exceed $10,000.3 Under the Tucker Act, generally the U.S. Court of Federal Claims has exclusive jurisdiction for contract actions seeking damages in excess of $10,000 from the United States. The Tucker Act provides, in pertinent part, that:
The United States Court of Federal Claims shall have jurisdiction to render judgment upon any claim against the United States founded either upon the Constitution or an Act of Congress or any regulation of an executive department, or upon any express or implied contract with the United States, or for liquidated or unliquidated damages in cases not sounding in tort.
28 U.S.C. 1491(a)(1).4
The Court finds that plaintiff's claims for damages in excess of $10,000 based on its contract with HUD fall within the scope of the Tucker Act. Accordingly, this Court will not address any of plaintiff's claims for damages in excess of $10,000 based on its contract with HUD. These are matters within the exclusive jurisdiction of the U.S. Court of Federal Claims. Defendant argues that plaintiff's Due Process Clause claim is cognizable in the Court of Claims as well because it is an action founded upon the Constitution (docket no. 38 at 2). To the extent that plaintiff seeks a money judgment against the United States in excess of $10,000 based on the Fourteenth Amendment, that claim is properly litigated in the Court of Federal Claims.
Under § 704 of the APA only "final agency action for which there is no other adequate remedy in a court [is] subject to judicial review." The Tucker Act allows the Court of Claims to "render judgment upon any claim against the United States founded. .. upon ... any regulation of an executive department ... or upon any express or implied contract with the United States...." 28 U.S.C. § 1491(a)(1). Accordingly, HUD argues that plaintiff has an adequate remedy in the Court of Claims under the Tucker Act and that, therefore, the APA does not authorize judicial review of any of plaintiff's claims in this court (docket no. 26 at 11-13).5 At the oral argument on December 3 and in its supplementary brief, HUD urged this Court to transfer the entire case to the U.S. Court of Federal Claims on the ground that all of plaintiff's claims could be litigated in the U.S. Court of Federal Claims because plaintiff, in essence, raises contract issues (docket no. 25, ¶ 4; docket no. 38). Plaintiff, on the other hand, argues that no adequate remedy is available in the Court of Claims, since plaintiff does not merely seek money damages. Plaintiff argues that primarily it seeks injunctive relief to keep the property which HUD has slated for foreclosure.
The Tucker Act does not confer jurisdiction on the U.S. Court of Federal Claims to consider broad equitable relief. The Tucker Act, as amended, permits the Court of Federal Claims to grant certain equitable relief ancillary to claims for money relief over which it has jurisdiction. For example, the Court of Federal Claims may grant equitable relief to afford complete relief on any contract claim brought before the contract has been awarded under § 1491(b)(2). Additionally, under § 1491(a)(2), the Court of Federal Claims, as an incident of and collateral to a money judgment, may issue orders directing restitution to office or position, placement in appropriate retirement or duty status, and correction of applicable records, remanding to the agency to accomplish this relief.
The Tucker Act "has long been construed" as waiving sovereign immunity only for those claims seeking damages, and not for those seeking prospective equitable relief (except in very limited circumstances). See Richardson v. Morris, 409 U.S. 464, 465, 93 S.Ct. 629, 630, 34 L.Ed.2d 647 (1973)(citing United States v. Jones, 131 U.S. 1, 9 S.Ct. 669, 33 L.Ed. 90 (1889)). In Bowen v. Massachusetts, Massachusetts challenged a final order by the Secretary of Health and Human Service refusing to reimburse the state through the Medicaid program for services related to intermediate care facilities for the mentally retarded. The state filed a complaint in district court alleging jurisdiction pursuant to § 1331 and a waiver of sovereign immunity through the APA and seeking the set aside of an agency decision, an injunction, and declaratory relief. In Bowen, the Supreme Court stated:
The [Court of Federal Claims] does not have the general equitable powers of a district court to grant prospective relief. Indeed, we have stated categorically that "the [Court of Federal Claims] has no power to grant equitable...
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