Sameena Inc. v. U.S. Air Force, 97-15252
| Decision Date | 06 July 1998 |
| Docket Number | No. 97-15252,97-15252 |
| Citation | 147 F.3d 1148 |
| Parties | 42 Cont.Cas.Fed. (CCH) P 77,335, 98 Cal. Daily Op. Serv. 5307, 98 Daily Journal D.A.R. 7457 SAMEENA INC., an Oregon corporation dba Samtech Research; Sameena Ali; Mirza Ali, Plaintiffs-Appellants, v. UNITED STATES AIR FORCE; V. Carol Moore; Steve Bangs; Alan Schoenberg; Maxwell Air Force Base; Pilson; Mike Thomason, Defendants-Appellees. |
| Court | U.S. Court of Appeals — Ninth Circuit |
J. Christopher Hall, Oakland, CA, Joseph P. Russoniello, Ann M. Mooney, Cooley Godward LLP, San Francisco, CA, for plaintiffs-appellants.
John N. Hemann, Assistant United States Attorney, San Francisco, CA, for defendants-appellees.
Appeal from the United States District Court for the Northern District of California; Fern M. Smith, District Judge, Presiding. D.C. No. CV-96-01889-FMS.
Before: D.W. NELSON, BOOCHEVER, and REINHARDT, Circuit Judges.
This case arises from a contractor's alleged attempts to defraud the government and the government's efforts to bar the contractor from bidding on future government projects. The appellants bring civil rights and common-law tort claims against a number of individual employees of the United States Air Force (the "Air Force") and argue that the Air Force's decision to debar them for a period of fifteen years was arbitrary and capricious, in violation of the Administrative Procedure Act ("APA"), codified in pertinent part at 5 U.S.C. § 704. The district court dismissed the claims against the individual defendants and granted summary judgment in favor of the Air Force on the APA claims. We have jurisdiction pursuant to 28 U.S.C. § 1291. Although we affirm the dismissal of the claims against the individual defendants, we reverse the district court's summary judgment because we conclude that the Department of the Air Force (the "Air Force") violated the appellants' constitutional right to due process when it denied them an evidentiary hearing, as required by 48 C.F.R. § 9.406-3(b)(2).
In February 1992, the Social Security Administration ("SSA") solicited bids from computer suppliers for a quantity of microcomputer workstations. University Systems, Inc. ("USI"), a California-based corporation of which Appellant Mirza Ali was Chief Executive Officer, submitted a proposal to the SSA in April 1992. USI's bid was deemed competitive, and USI provided the SSA with samples of its products for further evaluation.
During this process, questions arose regarding whether a mouse device included in the proposal was manufactured in compliance with the Trade Agreements Act of 1979, 19 U.S.C. §§ 2501-2582. While this matter was being investigated, it was discovered that two USI officers had submitted a fraudulent letter to the SSA. The SSA consequently eliminated USI from consideration for the workstation contract.
Subsequently, the United States Department of Health and Human Services ("HHS"), of which the SSA is part, commenced "debarment" proceedings against USI and four of its officers, including Mirza Ali, seeking to disqualify them from submitting government contract proposals for three years. On February 2, 1994, USI, Mirza Ali, and the other USI officers were debarred from government contracting through February 18, 1996.
Mirza Ali's wife, Appellant Sameena Ali, is president and sole director of Appellant Sameena Inc. ("Sameena"), which was incorporated in February 1993 by Keith Griffen, a USI officer. Each of the appellants uses aliases: Sameena Ali sometimes goes by "Sameena Ikbal." Mirza Ali sometimes goes by "Zulfiqar Eqbal." Sameena Inc. operates under the assumed name "Samtech Research, Inc." ("Samtech").
Like USI, Samtech supplied computer workstations to government agencies. In June 1995, an Alabama-based contracting squadron of the Air Force issued a contract solicitation for laptop computers. An amendment to the solicitation indicated that the buyer was V. Carol Moore.
Samtech submitted a proposal to Moore in July 1995. Included in Samtech's proposal was a certification that neither Samtech nor any of its principals was debarred or proposed for debarment at that time. The certification defined "principals" as "officers; directors; owners; partners; and persons having primary management or supervisory responsibilities within a business entity." Because the Air Force solicitation required that bidders have at least three years of experience as a government contractor, Samtech's proposal also included a list of "Government Contract Awards." Among them was a contract with the United States Department of Energy (the "DoE contract") that Sameena had obtained in 1994 through a novation from USI.
In response to a query, Samtech sent Moore a letter in September 1995 explaining that Samtech "started doing business with the Federal Government by acquiring a contract for the supply of ADP equipment to the United States Department of Energy in 1992." On further investigation, Moore discovered that the contract actually had been awarded to USI in 1992 and had only been On the basis of these apparent misrepresentations, Samtech was deemed ineligible for the Air Force contract. Moreover, in December 1995, the Air Force Contracting Officer, Gladys McBride, submitted a recommendation that Samtech be debarred. McBride appended the entire administrative file to her recommendation, including an affidavit by Moore describing her investigations.
novated to Samtech in 1994. Moore also obtained bank documents indicating that "Sameena Ikbal" and "Zulfiqar Eqbal" were authorized to make withdrawals from Samtech's accounts and were, respectively, "President/Secretary" and "Vice President" of the corporation. This information appeared to Moore to contradict the statements made in Samtech's contract proposal.
On December 26, 1995, Sameena Inc., Samtech, Sameena Ali, and Mirza Ali ("the appellants") were notified that they had been proposed for debarment (and, in Mirza Ali's case, an "extension" of debarment). The notices were accompanied by memoranda setting forth the grounds for the proposed debarments. The notices also invited the appellants to submit information and argument in opposition to the debarment.
The appellants included in their response a letter dated February 21, 1996, from an official at Samtech's bank. The letter stated that the document indicating that Zulfiqar Eqbal was Vice President of Samtech--a bank signature card--had been "corrected" after the bank was informed "that Eqbal was not a corporate officer" of Sameena or Samtech. The submission also included copies of checks written on Sameena's bank accounts. A number of these checks were signed by "Zulfiqar Eqbal" and were made out to a variety of payees, including physicians, a sports club, and Eqbal (Mirza Ali) himself. The appellants' submission also requested an evidentiary hearing on the issue of Mirza Ali's role at Samtech. Notwithstanding the submission, and without an evidentiary hearing, the Air Force issued a final decision in June 1996 to debar Sameena/Samtech and Sameena Ali--and to extend Mirza Ali's debarment--until December 2010. The debarment was based on findings that the appellants had (1) made false statements regarding Samtech's experience as a contractor, (2) provided false certifications that none of Samtech's principals was debarred, and (3) participated in a scheme to avoid the effects of USI's debarment.
On August 30, 1996, the appellants filed two complaints in the United States District Court for the Northern District of California. The first complaint, brought by Mirza Ali against HHS and against six agency employees in their individual capacities, focused on Ali's initial debarment and sought declaratory relief and damages. The second complaint, brought by Mirza Ali, Sameena Ali, and Sameena/Samtech against the Air Force and seven Air Force employees in their individual capacities, focused both on the debarment of Sameena/Samtech and Sameena Ali and on the extension of Mirza Ali's debarment.
This second complaint made substantially the same allegations as the first, even though it was directed at entirely different defendants. The appellants alleged (1) that the individual Air Force officials had conspired to violate their civil rights and had committed several common-law torts and (2) that the Air Force's decision to debar them was arbitrary and capricious and should be set aside pursuant to the APA.
In an order filed December 11, 1996, the district court dismissed the claims against the individual defendants for lack of personal jurisdiction and, alternatively, on the grounds that the appellants had failed either to plead conspiracy with sufficient particularity or to comply with the Federal Tort Claims Act, 28 U.S.C. §§ 1346(b), 2671-2680. The court also granted summary judgment to the Air Force on the APA claims. The appellants timely appeal. We affirm the district court's dismissal of the claims against the individual defendants but reverse the summary judgment in favor of the Air Force.
A dismissal with leave to amend is reviewed de novo. Dumas v. Kipp, 90 F.3d 386, 389 (9th Cir.1996). A grant of summary judgment is also reviewed de novo. Covey v. Hollydale Mobilehome Estates, 116 F.3d 830, 834 (9th Cir.1997). The standards governing
review of the district court's individual determinations are addressed below.
The district court determined that the appellants failed to "allege conspiracy with sufficient particularity." We agree. The appellants failed to allege facts to support their allegations that the individual defendants agreed illegally to debar them or that they agreed to discriminate against them because of their race. Accordingly, we affirm the district court's dismissal of the conspiracy count. S...
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