TOXCO, Inc. v. Chu

• Decision Date: 11 August 2011
• Docket Number: Civil Action No. 09–1925 (RMU).
• Citation: 801 F.Supp.2d 1
• Parties: TOXCO, INC., Plaintiff, v. Steven CHU et al., Defendants.
• Court: U.S. District Court — District of Columbia

801 F.Supp.2d 1

TOXCO, INC., Plaintiff,

v.Steven CHU et al., Defendants.

Civil Action No. 09–1925 (RMU).

United States District Court, District of Columbia.

Aug. 11, 2011.

Charles A. Patrizia, Paul Hastings LLP, Washington, DC, for Plaintiff.

Michelle Lo, U.S. Attorney's Office, Washington, DC, for Defendants.

MEMORANDUM OPINION

Granting the Defendants' Motion to Dismiss or, In the Alternative, for Summary Judgment; Granting the Defendants' Motion to Strike the Plaintiff's Sur–Reply

RICARDO M. URBINA, District Judge.

I. INTRODUCTION

This case is before the court on the defendants' motion to dismiss as moot or, in the alternative, for summary judgment. The plaintiff, Toxco, Inc., commenced this action against the Department of Energy and the Secretary of the Department of Energy, alleging that the defendants' actions violated the Administrative Procedure Act (“APA”) and the Due Process Clause of the Fifth Amendment. The defendants move to dismiss these claims pursuant to Federal Rule of Civil Procedure 12(b)(1), alleging that the court lacks jurisdiction because the plaintiff's claims are moot. In the alternative, the defendants move for summary judgment under Rule 56. Because the plaintiff's APA claim is moot, the court grants the defendants' motion to dismiss as to that claim. With respect to the plaintiff's remaining Due Process claim, the court grants the defendant's motion for summary judgment.

II. BACKGROUND

A. Factual Background

The Department of Energy (“DOE”) oversees the disposal of radioactive waste at nuclear waste facilities across the country. See 42 U.S.C. § 7133(a)(8)(A)-(E). One such facility is the Separations Process Research Unit (“SPRU”), which operated from 1950 to 1953 as a pilot plant to research the chemical extraction of uranium and plutonium from irradiated uranium. A.R. at 69. ¹ These operations contaminated the SPRU facility and the surrounding environment with radioactive material, resulting in the need to remediate the site. Id.

In October 2004, the DOE awarded a contract for several waste disposal operations to Accelerated Remediation Company (“ARC”), with individual projects to be specified in task orders. See id. at 1–62. The contract permitted ARC to subcontract with other entities, provided that the DOE formally consented to each individual subcontract. Id. at 47 (incorporating by reference 48 C.F.R. § 52.244–2, which requires an agency's Contracting Officer to consent before a contractor may enter into a subcontract). In September 2007, the DOE issued Task Order No. DE–AT30–07CC60013, SP15 (“Task Order SP15”), requiring ARC to engage in environmental remediation of approximately fifteen acres in the SPRU land areas. See generally A.R. at 63–105. Specifically, Task Order SP15 required the cleanup of radioactively and chemically contaminated soil from two areas at SPRU: the Lower Level Railbed and the Lower Level Parking Lot. Id. at 69.

In keeping with the terms of the DOE–ARC contract, in the summer of 2008 ARC subcontracted with Energy Solutions, a Utah company, to complete the waste disposal work under Task Order SP15. See generally id. at 346–48. Later that summer, ARC sought and received the DOE's permission to exit its subcontract with Energy Solutions as part of a cost-savings initiative. See generally id. at 349–51, 401–05; see Defs.' Mot. to Dismiss or, in the Alternative, for Summ. J. (“Defs.' Mot.”) at 8–9. ARC then solicited bids from other subcontractors that wished to engage in the Task Order SP15 remediation work at SPRU. A.R. at 402. In June 2009, Toxco, Inc. (“Toxco” or “the plaintiff”), a Tennessee company, submitted a bid to perform the Task Order SP15 work. See generally id. at 397–411. Pursuant to federal acquisition regulations and DOE guidelines, ARC required the DOE's consent before it could enter into a subcontract with Toxco. Id. at 47. On August 11, 2009, the DOE issued a letter giving its formal consent to the subcontract. Id. at 450 (“Consent Order”). The Consent Order included the following provision:

This consent shall in no way relieve the prime contractor of any obligations or responsibilities it may otherwise have under the contract or under law, shall neither create any obligation of the Government to, nor privity of contract with, the subcontractor or vendors, and shall be without prejudice to any right or claim of the Government under the prime contract. This consent does not constitute a determination as to the acceptability of the subcontract or the allowability of costs.

Id.

On August 12, 2009, having received the DOE's formal consent, ARC entered into a Purchase Order subcontract for the Task Order SP15 remediation work with Toxco. See generally id. at 451–63. The period of performance for the subcontract ran through December 31, 2009. Id. at 452. The subcontract also incorporated by reference a federal regulation titled “Termination for Convenience of the Government,” which allowed the government to “terminate performance of work under this contract in whole or, from time to time, in part if the Contracting Officer determines that a termination is in the Government's interest.” See id. at 454.

A week later, on August 19, 2009, the DOE reversed course and withdrew its consent for the ARC–Toxco subcontract. See id. at 498–500. Swiftly thereafter, ARC cancelled its subcontract with Toxco. Id. at 501–03. ARC subsequently re-contracted with Energy Solutions for completion of the remainder of Task Order SP15's remediation project at SPRU. Def.'s Mot. at 12. By June 12, 2010, Energy Solutions had completed the work contemplated by Task Order SP15. Id.

B. Procedural History

The plaintiff commenced this action in October 2009, asserting that the DOE's withdrawal of consent to the ARC–Toxco subcontract was both an arbitrary and capricious agency action in violation of the APA and a deprivation of property in violation of the Due Process Clause of the Fifth Amendment. See generally Compl. Upon filing its complaint, the plaintiff also moved for a preliminary injunction requiring the DOE to reinstate its consent to the subcontract so that it could continue with work on the subcontract. See generally Pl.'s Mot. for Preliminary Injunction. The defendants moved to dismiss the complaint. See generally Defs.' Mot. to Dismiss. In July 2010, the court issued a memorandum opinion denying the defendants' motion to dismiss and denying the plaintiff's motion for a preliminary injunction. See generally Mem. Op., 724 F.Supp.2d 16 (D.D.C.2010).

In September 2010, the defendants filed a second motion to dismiss under Rule 12(b)(1), asserting that the plaintiff's claims are moot. See Defs.' Mot. at 15–20. In the alternative, the defendants move for summary judgment on all of the plaintiff's claims. Id. at 20–30. With the defendants' motion now ripe for review, the court turns to the applicable legal standards and the parties' arguments.²

III. ANALYSIS

A. The Court Grants the Defendants' Rule 12(b)(1) Motion to Dismiss the Plaintiff's APA Claim for Mootness

1. Legal Standard for a Motion to Dismiss for Mootness

Under Rule 12(b)(1), a party may move to dismiss a case on grounds of mootness. Comm. in Solidarity with People of El Sal. v. Sessions, 929 F.2d 742, 744 (D.C.Cir.1991); Super Sack Mfg. Corp. v. Chase Packaging Corp., 57 F.3d 1054, 1060 (Fed.Cir.1995); Am. Historical Ass'n v. Peterson, 876 F.Supp. 1300, 1308 (D.D.C.1995). Article III's case-or-controversy requirement prohibits courts from issuing advisory opinions or decisions based on hypothetical facts or abstract issues. Flast v. Cohen, 392 U.S. 83, 96, 88 S.Ct. 1942, 20 L.Ed.2d 947 (1968). “The doctrine of mootness is a logical corollary of the case or controversy requirement [.]” Better Gov't Ass'n v. Dep't of State, 780 F.2d 86, 90 (D.C.Cir.1986). In cases where challenged conduct ceases and “there is no reasonable expectation that the wrong will be repeated, ... it becomes impossible for the court to grant any effectual relief whatever to the prevailing party, and any opinion as to the legality of the challenged action would be advisory.” City of Erie v. Pap's A.M., 529 U.S. 277, 287, 120 S.Ct. 1382, 146 L.Ed.2d 265 (2000). Accordingly, a court may not rule on the merits of a case in which the claim for relief is moot.

Courts must evaluate mootness “through all stages” of the litigation in order to ensure that a live controversy remains. 21st Century Telesis Joint Venture v. F.C.C., 318 F.3d 192, 198 (D.C.Cir.2003) (citing Friends of the Earth, Inc. v. Laidlaw Envtl. Servs. (TOC), Inc., 528 U.S. 167, 191, 120 S.Ct. 693, 145 L.Ed.2d 610 (2000) and Lewis v. Cont'l Bank Corp., 494 U.S. 472, 477, 110 S.Ct. 1249, 108 L.Ed.2d 400 (1990)). As a result, “[e]ven where litigation poses a live controversy when filed, the [mootness] doctrine requires a federal court to refrain from deciding it if ‘events have so transpired that the decision will neither presently affect the parties' rights nor have a more-than-speculative chance of affecting them in the future.’ ” Id. (quoting Clarke v. United States, 915 F.2d 699, 701 (D.C.Cir.1990)).

A case is moot when “the issues presented are no longer live or the parties lack a legally cognizable interest in the outcome.” City of Erie, 529 U.S. at 287, 120 S.Ct. 1382 (internal quotations omitted). An intervening event may render a claim moot if (1) there is no reasonable expectation that the conduct will recur and (2) interim relief or events have completely and irrevocably eradicated the effects of the alleged violations. Pharmachemie B.V. v. Barr Labs., Inc., 276 F.3d 627, 631 (D.C.Cir.2002); Sellers v. Bureau of Prisons, 959 F.2d 307, 310 (D.C.Cir.1992). A case is not moot, however, so long as any single claim for relief remains viable, as the remaining live issues satisfy the case-or-controversy requirement. Tucson Med. Ctr. v. Sullivan, 947 F.2d 971, 978 (D.C.Cir.1991) (internal quotations and citations omitted). The burden of establishing mootness...