**United States Court of Appeals for the Federal Circuit**

04-5040, -5041

NORFOLK DREDGING COMPANY, INC.,

> Plaintiff-Appellee,

v\.

UNITED STATES,

> Defendant-Appellant,

and

BEAN STUYVESANT, L.L.C.,

> Defendant-Appellant.

[Michael H. Payne]{.underline}, Starfield & Payne, P.C., of Fort
Washington, Pennsylvania, argued for plaintiff-appellee. With him on the
brief was [Joseph A. Hackenbracht]{.underline}. Of counsel on the brief
was [Guilford D. Ware]{.underline}, Crenshaw, Ware & Martin, of Norfolk,
Virginia.

[Domenique Kirchner]{.underline}, Attorney, Commercial Litigation
Branch, Civil Division, United States Department of Justice, of
Washington, DC, argued for defendant-appellant United States. With her
on the brief were [Peter D. Keisler]{.underline}, Assistant Attorney
General; [David M. Cohen]{.underline}, Director; and [Deborah A.
Bynum]{.underline}, Assistant Director.

[Jeffrey F. Lawrence]{.underline}, Sher & Blackwell, L.L.C., of
Washington, DC, argued for defendant-appellant Bean Stuyvesant, L.L.C.
With him on the brief was [Heather M. Spring]{.underline}.

Appealed from: United States Court of Federal Claims

Judge Christine O.C. Miller

United States Court of Appeals for the Federal Circuit

04-5040, -5041

NORFOLK DREDGING COMPANY, INC.,

> Plaintiff-Appellee,

v\.

UNITED STATES,

> Defendant-Appellant,

and

BEAN STUYVESANT, L.L.C.,

> Defendant-Appellant.

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

DECIDED: July 7, 2004

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Before NEWMAN, RADER, and LINN, [Circuit Judges]{.underline}.

LINN, [Circuit Judge]{.underline}.

Bean Stuyvesant L.L.C. ("Bean") and the United States ("Government")
(collectively, "Appellants") appeal from a decision of the Court of
Federal Claims granting summary judgment in favor of Norfolk Dredging
("Norfolk") and enjoining the Army Corps of Engineers ("Corps") from
awarding a dredging contract to Bean. [Norfolk Dredging Co. v. United
States]{.underline}, 58 Fed. Cl. 741 (2003) ("[Norfolk
II]{.underline}"). Because the Court of Federal Claims erred in
construing the statutory exception to 46 U.S.C. app. § 292 and in
concluding that Bean's activities did not fall within the scope of the
statutory exception, we reverse and remand to the Court of Federal
Claims with instructions to enter summary judgment in favor of
Appellants.

BACKGROUND

This is a bid protest action challenging the legality of Bean's
performance of dredging operations under Corps solicitation no.
DACW54‑03‑B‑0011 ("the contract"). Bean is a limited liability company
organized under Delaware law. Bean is 50% owned by Bean Dredging L.L.C.,
a U.S. company, and 50% owned by Stuyvesant Dredging Co. ("SDC"), which
is in turn wholly owned by a Dutch corporation. Thus, Bean is 50%
foreign owned. The MERIDIAN is a non-hopper dredge owned by a U.S.
company, Bean Meridian L.L.C. ("Bean Meridian"), and is documented under
46 U.S.C. ch. 121. Hopper dredges are self-propelled vessels that pump
dredged material from the channel floor and store the material in
containers called hoppers aboard the vessel. Non-hopper vessels are
unable to store the dredged material on board; the dredged material must
be piped to a separate vessel or location.

On August 8, 2003, the Corps issued bid solicitation no.
DACW54-03-B-0011 for dredging in the vicinity of Morehead City Inner
Harbor, North Carolina. Because of environmental concerns, the placement
of dredged material on the beaches was to be completed between November
2003 and April 2004. Bean was the low bidder, and proposed performing
the work using the MERIDIAN, a non-hopper dredging vessel chartered from
Bean Meridian. Norfolk was the second lowest bidder.

Norfolk filed an expedited bid protest action in the Court of Federal
Claims challenging the legality of Intervenor Bean's performance of the
dredging operations in alleged violation of the terms of § 5501 of the
Oceans Act of 1992. The parties agreed that Bean should be initially
awarded the contract, subject to termination in the event the Court of
Federal Claims should find that Bean was not eligible to perform.

The Court of Federal Claims observed that the Foreign Dredge Act of
1906, as amended by § 5501 of the Oceans Act of 1992 (codified at 46
U.S.C. app. § 292), bars foreign-built dredges from operating in U.S.
waters. [Norfolk II]{.underline}, 58 Fed. Cl. at 743. However, the note
following 46 U.S.C. app. § 292 contains exceptions that include SDC and
any entity in which it owns an interest. [Id.]{.underline} at 744. Thus,
the issue was whether Bean could legally charter a U.S.-built and
-documented non-hopper dredge under the statutory exception.
[Id.]{.underline} The court construed the statutory exception to 46
U.S.C. app. § 292 to exclude Bean's charter of the non-hopper dredge
MERIDIAN pursuant to the contract, and thus Bean was barred from
performing the contract by § 5501 of the Oceans Act of 1992. Following
the court's denial of the Government's motion for reconsideration, Bean
and the Corps entered into a no-cost termination of the contract.

Bean and the Government timely appealed from the Court of Federal
Claims' October 14, 2003 order, [Norfolk Dredging Co. v. United
States]{.underline}, 58 Fed. Cl. 167 (2003) ("[Norfolk I]{.underline}");
November 26, 2003 order on motion for reconsideration; and November 26,
2003 Corrected Opinion and Order, [Norfolk II]{.underline}. We have
jurisdiction from a final judgment of the Court of Federal Claims
pursuant to 28 U.S.C. § 1295(a)(3).

DISCUSSION

I. Standard of Review

"This court reviews the Court of Federal Claims' grant of summary
judgment de novo." [Billings v. United States]{.underline}, 322 F.3d
1328, 1332 (Fed. Cir. 2003). The underlying issue of statutory
construction is a question of law we review de novo. [Id.]{.underline}

II\. Analysis

A. Statutory Construction

The Oceans Act of 1992 ("the Act") changed the law regarding the
chartering of dredging vessels in U.S. waters. The Act required that a
charterer of a dredging vessel in U.S. waters be at least 75% owned by
U.S. citizens. Oceans Act of 1992, § 5501(a)(1), Pub. L. No. 102-587,
106 Stat. 5084, [codified at]{.underline} 46 U.S.C. app. § 292(a)(2)
(2000) (citing the 75% domestic ownership requirements of 46 U.S.C. app.
§ 802). However, the Act included the following exceptions to this basic
rule:

> The amendment . . . does not apply to---
>
> \(A\) (i) the vessel STUYVESANT, official number 648540;
>
> \(ii\) any other hopper dredging vessel documented under chapter 121
> of title 46, United States Code before the effective date of this Act
> and chartered to Stuyvesant Dredging Company or to an entity in which
> it has an ownership interest; however, this exception expires on
> December 3, 2022 or when the vessel STUYVESANT ceases to be documented
> under chapter 121, whichever first occurs; and
>
> \(iii\) any other non-hopper dredging vessel documented under chapter
> 121 and chartered to Stuyvesant Dredging Company or to an entity in
> which it has an ownership interest, as is necessary (a) to fulfill
> dredging obligations under a specific contract, including any
> extension periods; or (b) as temporary replacement capacity for a
> vessel which has become disabled but only for so long as the
> disability shall last and until the vessel is in a position to fully
> resume dredging operations; however, this exception expires on
> December 8, 2022 or when the vessel STUYVESANT ceases to be documented
> under chapter 121, whichever first occurs . . . .

[Id.]{.underline} § 5501(a)(2), [codified at]{.underline} 46 U.S.C. app.
§ 292 note (2000) (respectively, "exceptions (A)(i)", "(A)(ii)" and
"(A)(iii)").

It is undisputed that Bean, the charterer of the non-hopper vessel
MERIDIAN, was 50% owned by SDC, a foreign enterprise, and thus is
prohibited from chartering vessels for dredging in U.S. waters under the
terms of 46 U.S.C. app. § 292(a)(2). [Norfolk II]{.underline}, 58 Fed.
Cl. at 744. The parties principally dispute whether Bean falls into one
of the statutory exceptions---(A)(i), (ii), or (iii)---enumerated in the
note to 46 U.S.C. app. § 292. The applicability of exception (A)(iii)
pertaining to non-hopper dredges is principally contested.

The Court of Federal Claims found that the three statutory exceptions in
(A)(i)‑(iii) relating to the vessel STUYVESANT, hopper vessels, and
non-hopper vessels in § 5501(a)(2) of the Act, were amenable to
construction based on their plain meaning. [Norfolk II]{.underline}, 58
Fed. Cl. at 752. The court concluded that the "only construction that
gives effect to all of the conditions set forth in the exception . . .
and reads all of subsections (A)(i), (ii), and (iii) together" was the
following:

> Under subsection (A)(iii), Stuyvesant Dredging Company or an entity in
> which it has an interest can utilize any non-hopper, even if not yet
> built, to fulfill contracts entered into utilizing STUYVESANT or any
> other qualified hopper. In other words, the non-hoppers would be
> supplemental to the dredging activities involving hoppers. Also, a
> non-hopper so chartered can be used as a temporary replacement for a
> hopper or a non-hopper. The latter event would occur when a contract
> is being performed only by a hopper or a non-hopper that has become
> disabled.

[Id.]{.underline} at 753. The court later noted that

> \[a\]n arrangement would satisfy \[exception (A)(iii)\] only if the
> chartered non-hopper vessel "is necessary . . . to fulfill dredging
> obligations under a specific contract," [supplementing a hopper vessel
> documented as of 1992]{.underline}, "including any extension periods,"
> or to complete temporary replacement of a hopper or non-hopper
> performing a hopper contract.

[Id.]{.underline} at 755 (quoting Oceans Act of 1992,
§ 5501(a)(2)(A)(iii)) (emphasis added).

Appellants argue that the Court of Federal Claims erred in interpreting
the statute such that Bean's chartering of the non-hopper dredge
MERIDIAN did not fall into exception (A)(iii). They allege that the
Court of Federal Claims' statutory interpretation is at odds with the
structure of the exceptions in 46 U.S.C. app. § 292 note. According to
Appellants, exception (A)(i) applies to the vessel STUYVESANT itself;
exception (A)(ii) applies to "any other hopper dredging vessel"; and
exception (A)(iii) applies to "any other non-hopper dredging vessel."
Because these clauses are separated by semi-colons, Appellants argue
that the three numbered clauses are independent. They argue that the
Court of Federal Claims impermissibly read limitations into the plain
and unambiguous statutory language of exception (A)(iii), specifically
that the non-hopper dredges must be documented before the effective date
of the Act, and that utilized non-hopper dredges must be supplemental to
the dredging activity involving hoppers. Appellants contend that if
Congress had intended exception (A)(iii) to apply only to non-hopper
dredges documented as of 1992, the date the Act was enacted, it could
have said so explicitly, just as it specified in exception (A)(ii). They
argue that tying all three exceptions to the operation of hopper vessels
was erroneous.

Norfolk responds that the Court of Federal Claims properly interpreted
the plain language of the statute. It argues that the statute was
intended to exempt vessels, not companies, and was intended to provide
for the continued availability of the vessel STUYVESANT, not SDC.
Contrary to Appellants' arguments, Norfolk argues the court did not read
in limitations from the legislative history, but instead based its
statutory construction on the plain meaning. Under Appellants'
construction, allowing foreign-owned companies like Bean to engage in
unlimited non-hopper dredging makes the language "as is necessary . . .
to fulfill dredging obligations under a specific contract" in exception
(A)(iii) completely superfluous---thus allowing an exception to swallow
the rule.

Statutory interpretation begins with the language of the statute.
[Williams v. Taylor]{.underline}, 529 U.S. 420, 431 (2000). A court
derives the plain meaning of the statute from its text and structure.
[Alexander v. Sandoval]{.underline}, 532 U.S. 275, 288 (2001). If the
language is clear and fits the case, the plain meaning of the statute
generally will be regarded as conclusive. [Sullivan v.
Stroop]{.underline}, 496 U.S. 478, 482 (1990); [see also]{.underline}
[VE Holding Corp. v. Johnson Gas Appliance Co.]{.underline}, 917 F.2d
1574, 1579-80 (Fed. Cir. 1990) (noting that unambiguous statutory
language controls, unless legislative intent is clearly contrary or when
its application produces a result so unlikely that Congress could not
have intended it). "We have stated time and again that courts must
presume that a legislature says in a statute what it means and means in
a statute what it says there." [Conn. Nat'l Bank v.
Germain]{.underline}, 503 U.S. 249, 253-54 (1992).

The language of the statute at issue in this case is clear and
unambiguous, and absent extraordinary circumstances our inquiry must end
here. [See]{.underline} [VE Holding]{.underline}, 917 F.2d at 1580.
Thus, it is unnecessary to seek clarification in the admittedly sparse
legislative history. [See]{.underline} [Norfolk II]{.underline}, 58 Fed.
Cl. at 756 ("The legislative history is limited.").

The exceptions pertaining to SDC set forth in 46 U.S.C. app. § 292 note
apply to three categories of vessels in which SDC has an ownership
interest, each set forth in its own separate subparagraph. The three
exceptions are separated by semi-colons and do not expressly incorporate
the requirements of any other exception. Exception (A)(i) pertains to
the hopper vessel STUYVESANT. Oceans Act of 1992, § 5501(a)(2)(A)(i).
Exception (A)(ii) concerns "any other hopper dredging vessel" and
imposes certain further limitations as to which hopper dredges it
exempts. [Id.]{.underline} § 5501(a)(2)(A)(ii). Similarly, exemption
(A)(iii) concerns "any other non-hopper dredging vessel" with certain
further limitations on the scope of the exemption. [Id.]{.underline}
§ 5501(a)(2)(A)(iii). These three self-contained, semi-colon delimited
subparagraphs are independent of each other.

Exemption (A)(iii) provides:

> \(iii\) any other non-hopper dredging vessel documented under chapter
> 121 and chartered to Stuyvesant Dredging Company or to an entity in
> which it has an ownership interest, as is necessary (a) to fulfill
> dredging obligations under a specific contract, including any
> extension periods; or (b) as temporary replacement capacity for a
> vessel which has become disabled but only for so long as the
> disability shall last and until the vessel is in a position to fully
> resume dredging operations; however, this exception expires on
> December 8, 2022 or when the vessel STUYVESANT ceases to be documented
> under chapter 121, whichever first occurs;

[Id.]{.underline} § 5501(a)(2)(A)(iii). Under exemption (A)(iii),
non-hopper dredges are released from the prohibitions of 46 U.S.C. app.
§ 292 under the following conditions: (1) the non-hopper dredge must be
documented under 46 U.S.C. ch. 121, [id.]{.underline}; (2) the
non-hopper dredge must be "chartered to \[SDC\] or to an entity in which
it has an ownership interest," [id.]{.underline}; (3) the non-hopper
dredge must be chartered to fulfill dredging obligations under a
specific contract, including any extension periods, [or]{.underline} as
temporary replacement capacity for a vessel which has become disabled,
but only for so long as the disability shall last and until the vessel
is in a position to fully resume dredging operations, [id.]{.underline};
and (4) the exemption expires on the earlier of December 8, 2022 or when
the vessel STUYVESANT ceases to be documented under 46 U.S.C. ch. 121.
[Id.]{.underline}

In urging us to adopt the statutory construction of the Court of Federal
Claims, Norfolk argues that the court's importation of two additional
limitations not present in the statutory language was correct. As
outlined previously, the Court of Federal Claims interpreted exception
(A)(iii) to require that non-hopper dredges could only be used "to
fulfill contracts entered into utilizing STUYVESANT or any other
qualified hopper." [Norfolk II]{.underline}, 58 Fed. Cl. at 753.
Further, the court required the supplemental chartering of a non-hopper
dredge under an existing contract for "any other qualified hopper" was
only allowable to "supplement\[\] a hopper vessel documented as of
1992," the date the Oceans Act was enacted. [Id.]{.underline} at 755.

The Court of Federal Claims' interpretation erroneously adds conditions
not present in the statutory language. Neither the plain language of
exception (A)(iii) nor the structure of the three exceptions pertaining
to SDC provides any basis for the court's conclusion that non-hopper
dredges could only be used in a supplemental or replacement capacity to
fulfill contracts expressly calling for the services of the vessel
STUYVESANT or other hopper vessels documented as of 1992. If Congress
had intended these additional restrictions, it could easily have added
express language to that effect. Neither the Court of Federal Claims nor
Norfolk indicated any language in the statutory exceptions to restrict
the charter of non-hopper dredges solely to "supplement," or fulfill
contracts calling for, the vessel STUVYESANT or other hopper dredges
documented as of 1992. There is no express language requiring that
non-hopper dredges only supplement, as temporary replacements, hopper
dredges that satisfy the requirements of exception (A)(ii).
[See]{.underline} Oceans Act of 1992, § 5501(a)(2)(A)(iii). It is
telling that exception (A)(ii) specifically requires chartered hopper
dredges to be "documented under \[46 U.S.C. ch. 121\] before the
effective date of this Act," [id.]{.underline} § 5501(a)(2)(A)(ii),
which was November 24, 1992. Exception (A)(iii) lacks a similar clause.
[See]{.underline} [id.]{.underline} § 5501(a)(2)(A)(iii). We conclude
that such an omission was intentional. [See]{.underline} [Duncan v.
Walker]{.underline}, 533 U.S. 167, 173-74 (2001) (noting that where
Congress introduces language in one section yet omits it in another, the
disparate inclusion or exclusion is deemed intentional).

Finally, contrary to the Court of Federal Claims' contentions, [Norfolk
II]{.underline}, 58 Fed. Cl. at 758, and Norfolk's arguments, a plain
meaning interpretation does not cause the exception to swallow the rule.
Exception (A)(iii) does not exempt every non-hopper dredge chartered to
commercial entities in which SDC has an ownership interest, but only
those that meet the additional criteria enumerated in the exception. The
non-hopper dredges must be chartered "to fulfill dredging obligations
under a specific contract" or in a "temporary replacement capacity" for
a disabled vessel, and the charter must occur before the exception
expires. Oceans Act of 1992, § 5501(a)(2)(A)(iii).

B. Present Applicability of Statutory Exemption

Under our preceding statutory interpretation of exception (A)(iii), we
conclude that exception (A)(iii) has four requirements. We address
Bean's satisfaction of each requirement in turn.

First, the non-hopper dredge must be documented under 46 U.S.C. ch. 121.
There is no dispute that the MERIDIAN is a non-hopper dredging vessel
documented under 46 U.S.C. ch. 121. [See]{.underline} [Norfolk
II]{.underline}, 58 Fed. Cl. at 743.

Second, the non-hopper dredge must be chartered to SDC or to an entity
in which it has an ownership interest. There is no dispute that SDC has
a 50% ownership interest in Bean. [Id.]{.underline} at 743-44. The
MERIDIAN, in turn, is chartered to Bean. [Id.]{.underline} at 743. Thus,
there is no dispute that the non-hopper dredge MERIDIAN is chartered to
Bean, an entity in which SDC has an ownership interest.

Third, the non-hopper dredge must be chartered to fulfill dredging
obligations under a specific contract, including any extension periods,
or as temporary replacement capacity for a vessel which has become
disabled, but only for so long as the disability shall last and until
the vessel is in a position to fully resume dredging operations. Bean
proposed that the MERIDIAN would be chartered to perform dredging
contracts under the Corps' contract bidding solicitation no.
DACW54‑03‑B‑0011. [See]{.underline} [id.]{.underline} at 743. Bean was
the lowest bidder on the contract, and the Corps awarded the contract to
Bean. [Id.]{.underline} Thus, Bean satisfies this requirement because it
chartered the MERIDIAN to fulfill dredging obligations under a specific
contract.

Fourth, the exemption expires on the earlier of December 8, 2022 or when
STUYVESANT ceases to be documented under chapter 121 of Title 46, United
States Code. Because the vessel STUYVESANT is currently documented under
46 U.S.C. ch. 121, the statutory exception has not yet expired.

Accordingly, there are no genuine issues of material fact that Bean's
chartering of the vessel MERIDIAN pursuant to the contract falls within
the correct statutory construction of exception (A)(iii). Thus, we
reverse the grant of summary judgment in favor of Norfolk and remand to
the Court of Federal Claims with instructions to enter summary judgment
in favor of Appellants.

CONCLUSION

Because the Court of Federal Claims erred in its construction of the
statutory exception to 46 U.S.C. app. § 292 and because we conclude
under the correct construction that Bean falls within the statutory
exception, we reverse the grant of summary judgment in favor of Norfolk
and remand to the Court of Federal Claims with instructions to enter
summary judgment in favor of Appellants Bean and the United States.

[REVERSED AND REMANDED]{.underline}.

COSTS

Costs to Appellants.