Rollerson v. Brazos River Harbor Navigation Dist. of Brazoria Cnty. Tex.

• Decision Date: 29 July 2021
• Docket Number: No. 20-40027,20-40027
• Parties: Manning ROLLERSON, Plaintiff—Appellant, v. BRAZOS RIVER HARBOR NAVIGATION DISTRICT OF BRAZORIA COUNTY TEXAS, now known as Port Freeport; United States Army Corps of Engineers, Defendants—Appellees.
• Court: U.S. Court of Appeals — Fifth Circuit

6 F.4th 633

Manning ROLLERSON, Plaintiff—Appellant,

v.BRAZOS RIVER HARBOR NAVIGATION DISTRICT OF BRAZORIA COUNTY TEXAS, now known as Port Freeport; United States Army Corps of Engineers, Defendants—Appellees.

No. 20-40027

United States Court of Appeals, Fifth Circuit.

FILED July 29, 2021

Amy Catherine Dinn, Colin Cox, Lone Star Legal Aid, Houston, TX, for Plaintiff - Appellant

Barry Abrams, Blank Rome, L.L.P., Houston, TX, for Defendant - Appellee Brazos River Harbor Navigation District of Brazoria County Texas, now known as Port Freeport

Jimmy Anthony Rodriguez, Assistant U.S. Attorney, U.S. Attorney's Office, Southern District of Texas, Houston, TX, for Defendant - Appellee United States Army Corps of Engineers

Before Jones, Haynes, and Ho, Circuit Judges.

Haynes, Circuit Judge:

This case concerns claims under § 601 of Title VI of the Civil Rights Act of 1964, 42 U.S.C. § 2000d, and the Administrative Procedure Act ("APA"), 5 U.S.C. §§ 701 – 06 involving racial claims by the Appellant. As explained below, we AFFIRM in part and REVERSE and REMAND in part.

I. Background

Manning Rollerson, who alleges discrimination in his brief based upon being African-American,¹ owns an interest in real property in the East End neighborhood of Freeport, Texas. The neighborhood was created in the 1930s, when the Freeport city council designated the area as a "Negro reservation" and forced all African-American residents, apart from live-in servants, to relocate there. Today, the East End remains majority-minority: of its 365 residents in 2010, 71% were Hispanic and 15% African-American. The City of Freeport as a whole is 60% Hispanic and 12% African-American.

Port Freeport (the "Port") is a navigation district governed by six locally-elected commissioners. During the past ten years, the Port has been cooperating with the U.S. Army Corps of Engineers (the "Corps") on planning and executing the Freeport Harbor Channel Improvement Project. The channel improvement project will deepen several areas of Freeport harbor, including the area alongside Berth 7 of the Velasco Container Terminal. The Velasco Terminal is adjacent to the East End.

To complement the channel improvement project, the Port plans to expand its facilities at and around the Velasco Terminal. To construct these new facilities, the Port needs land, and has consequently been acquiring properties in the East End with the goal of eventually buying up the entire neighborhood. Indeed, by March 2019, the Port owned 393 out of 581 platted lots in the East End. To fund these acquisitions and other aspects of its expansion, the Port has allegedly applied for and received federal funding, including over $48 million from the Corps.

Rollerson asserted that the Port has used coercive means to obtain property in the East End. For example, he alleged that the Port has threatened East End property-owners with condemnation and eminent domain; that Port officials have told residents that there are liens on their property, even when there are not; and that the Port has refused to provide independent appraisals of properties when it makes an offer. The Port has also allegedly been conspiring with city officials to deny building permits in the East End, keeping property values low. Further, Rollerson claimed that the Port has demolished or defaced many of the properties it has acquired, depressing the values of the remaining unsold properties and putting more pressure on their owners to sell. Rollerson alleged that communications between the Port and its broker indicated that the East End property the Port has been acquiring would be worth "15–20 times more on the open market" than what the Port offered.²

On November 1, 2017, Rollerson and other East End residents submitted an administrative complaint to various federal agencies, including the U.S. Department of Defense (the "DOD"), asserting that the Port's actions in the East End violate Title VI. By October 2018, all the agencies except for the DOD had responded, deferring jurisdiction to the DOD. On February 13, 2019, the Corps, an agency within the DOD, denied the administrative complaint by letter, stating:

The U.S. Army Corps of Engineers takes its responsibilities under Title VI very seriously. However, the subject East End displacements are not part of any [Corps] project, and the navigation program activities at Freeport Harbor do not constitute "Federal financial assistance" as that term is used in Title VI of the Civil Rights Act. Accordingly, we do not have Title VI jurisdiction and do not intend to take further action on the administrative complaint.

Following the denial of the administrative complaint, Rollerson sued the Port and the Corps in federal district court. Rollerson claimed that the Port violated § 601 of Title VI by intentionally discriminating against East End residents during its expansion and that the Corps violated the APA by denying his administrative complaint. On recommendation from the magistrate judge, the district court granted the Port's motion to dismiss for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6). On a separate recommendation from the magistrate judge, the district court also granted the Corps's motion to dismiss for lack of subject-matter jurisdiction under Federal Rule of Civil Procedure 12(b)(1). Rollerson timely appealed. See 28 U.S.C. § 2107(b).

II. Jurisdiction & Standard of Review

The district court had jurisdiction under 28 U.S.C. § 1331. This court has jurisdiction over Rollerson's appeal under 28 U.S.C. § 1291. We review de novo a district court's dismissal of a complaint under Rule 12(b)(6). Ruiz v. Brennan , 851 F.3d 464, 468 (5th Cir. 2017). To survive dismissal under Rule 12(b)(6), a complaint's allegations must, "when taken as true, state[ ] ‘a claim to relief that is plausible on its face.’ " Innova Hosp. San Antonio, Ltd. P'ship v. Blue Cross & Blue Shield of Ga., Inc. , 892 F.3d 719, 726 (5th Cir. 2018) (quoting Bell Atl. Corp. v. Twombly , 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) ).

Dismissal for lack of subject-matter jurisdiction under Rule 12(b)(1) is also reviewed de novo. Raj v. La. State Univ. , 714 F.3d 322, 327 (5th Cir. 2013). If, as here, the district court relied only on the face of the complaint, our review is "limited to determining whether the district court's application of the law is correct." Rodriguez v. Christus Spohn Health Sys. Corp. , 628 F.3d 731, 734 (5th Cir. 2010) (quoting Williamson v. Tucker , 645 F.2d 404, 413 (5th Cir. 1981) ). Further, a Rule 12(b)(1) motion "should be granted only if it appears certain the plaintiff cannot prove any set of facts that would entitle her to recovery." Morris v. Thompson , 852 F.3d 416, 419 (5th Cir. 2017).

III. Discussion

Rollerson appeals the district court's dismissal of his § 601 claim against the Port and his APA claim against the Corps. We conclude that the district court properly dismissed Rollerson's § 601 claim, but that it erred in dismissing his APA claim.

A. § 601

Rollerson sought to challenge the Port's expansion into the East End under § 601 of Title VI, which provides that "[n]o person in the United States shall, on the ground of race, color, or national origin, be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any program or activity receiving Federal financial assistance." 42 U.S.C. § 2000d. Only racial discrimination of the same character as that forbidden by the Equal Protection Clause is prohibited by § 601. Grutter v. Bollinger , 539 U.S. 306, 343, 123 S.Ct. 2325, 156 L.Ed.2d 304 (2003). Thus, it "prohibits only intentional discrimination." Alexander v. Sandoval , 532 U.S. 275, 280, 121 S.Ct. 1511, 149 L.Ed.2d 517 (2001). As the Port fails to contest that Rollerson has adequately alleged federal funding for present purposes,³ the issue on appeal is whether Rollerson's operative complaint adequately alleged intentional discrimination.

To plead that the Port acted with discriminatory intent, Rollerson must allege that the Port is expanding into the East End "at least in part ‘because of,’ not merely ‘in spite of,’ [the expansion's] adverse effects" on the East End's minority population. Pers. Adm'r of Mass. v. Feeney , 442 U.S. 256, 279, 99 S.Ct. 2282, 60 L.Ed.2d 870 (1979). The Supreme Court laid out one method of proving such intent in Village of Arlington Heights v. Metropolitan Housing Development Corp. , 429 U.S. 252, 264–68, 97 S.Ct. 555, 50 L.Ed.2d 450 (1977). Under Arlington Heights , the "starting point" of the inquiry is whether the challenged action "bears more heavily on one race than another." Id. at 266, 97 S.Ct. 555 (quoting Washington v. Davis , 426 U.S. 229, 242, 96 S.Ct. 2040, 48 L.Ed.2d 597 (1976) ). If the disparate impact is clearly "unexplainable on grounds other than race," then a court may infer racial animus. Arlington Heights , 429 U.S. at 266, 97 S.Ct. 555. If not, the court must perform "a sensitive inquiry into such circumstantial and direct evidence of intent as may be available." Id.

The Supreme Court has provided five factors to guide this inquiry: "(1) the historical background of the decision, (2) the specific sequence of events leading up to the decision, (3) departures from the normal procedural sequence, (4) substantive departures, and (5) legislative history, especially where there are contemporary statements by members of the decision-making body." Veasey v. Abbott , 830 F.3d 216, 231 (5th Cir. 2016) (en banc) (plurality opinion) (quoting Overton v. City of Austin , 871 F.2d 529, 540 (5th Cir. 1989) ). These factors are not exhaustive, and the ultimate determination requires examining "the totality of the circumstances." Veasey , 830 F.3d at 230, 235 (plurality opinion).

Assuming arguendo that Rollerson may rely on the Arlington Heights factors,⁴ the critical problem for Rollerson is that the "sequence of events" leading to the Port's decision shows no sign of racial animus....