Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-05-05084/USCOURTS-caDC-05-05084-0/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 

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United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued February 6, 2006 Decided March 3, 2006

No. 04-5449

ROSEMARY LOVE, ET AL.,

APPELLANTS

v.

MICHAEL JOHANNS, SECRETARY, U.S. DEPARTMENT OF

AGRICULTURE

APPELLEE

Consolidated with

05-5084

Appeals from the United States District Court

for the District of Columbia

(No. 00cv02502)

Marc L. Fleischaker argued the cause for appellants. With

him on the briefs were Barbara S. Wahl and Kristine J. Dunne.

Pamela Coukos and Michael Foreman were on the brief of

amici curiae The Impact Fund, et al. in support of appellants.

Steven A. Skalet entered an appearance.

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Dina R. Lassow and Paul M. Smith were on the brief of

amici curiae National Women’s Law Center and National

Partnership for Women & Families in support of appellants.

Charles W. Scarborough, Attorney, U.S. Department of

Justice, argued the cause for appellee. With him on the brief

were Peter D. Keisler, Assistant Attorney General, Kenneth L.

Wainstein, U.S. Attorney, and Robert M. Loeb, Attorney.

Shay Dvoretzky argued the cause for amicus curiae

Chamber of Commerce of the United States of America in

support of appellee. With him on the brief were Glen D. Nager,

Jason J. Jarvis, and Robin S. Conrad. 

Before: SENTELLE and HENDERSON, Circuit Judges, and

EDWARDS, Senior Circuit Judge.

Opinion for the Court filed by Circuit Judge SENTELLE.

SENTELLE, Circuit Judge: Rosemary Love and nine other

female farmers appeal from the denial of their motion for class

certification. Appellants claim, on behalf of themselves and

“not less than 3,000” similarly situated women, that the United

States Department of Agriculture (“USDA” or “the

Department”) discriminatorily administered its lending

programs, and that the Department failed to process and

properly investigate women’s discrimination complaints over

the last quarter-century. Because we conclude the District Court

did not abuse its discretion in denying the Appellants’ motion

for class certification and did not err in dismissing the failure-toinvestigate claim, we affirm in part. However, because the

Appellants’ claim under the Administrative Procedure Act, 5

U.S.C. § 706(2)(A) (“APA”), remains largely unbriefed, we

remand in part. 

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1

 ECOA claims are generally governed by a two-year statute

of limitations. See 15 U.S.C. § 1691e(f). However, in light of Pigford

v. Glickman, 182 F.R.D. 341 (D.D.C. 1998), Congress retroactively

extended the limitations period for certain claims, including those

raised by the Appellants. See Agriculture, Rural Development, Food

and Drug Administration, and Related Agencies Appropriations Act

of 1999, Pub. L. No. 105-277, 112 Stat. 2681 (codified at 7 U.S.C. §

2279 note).

2

 Prior to January 1, 2000, the FSA was named the Farmers

Home Administration. See 60 Fed. Reg. 23030, 23035 (1995).

Throughout this opinion, we use “FSA” to refer to both entities.

I. INTRODUCTION

The Appellants allege the USDA has engaged in a

nationwide “pattern or practice” of discrimination, dating back

to 1981.1

 Specifically, the Appellants’ first claim—hereinafter

the “discrimination claim”—is that the Department violated the

Equal Credit Opportunity Act, 15 U.S.C. §§ 1691-1691f

(“ECOA” or “the Act”) by employing subjective loan-making

criteria, which enabled decentralized decision-makers to

discriminate amongst loan applicants on the basis of gender.

The Appellants’ second claim—hereinafter the “failure-toinvestigate claim”—is that the Department violated both ECOA

and the APA by systematically dismantling its complaintprocessing systems and failing to investigate discrimination

claims filed by women farmers.

A

The USDA administers its farm loan and subsidy programs

through the Farm Service Agency (“FSA”).2

 The FSA makes

several different types of loans, including “farm ownership”

loans, which assist farmers in buying or improving farm

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property, 7 C.F.R. pt. 1943, “operating” loans, which provide

credit and management assistance to help farmers run their

farms, id. pt. 1941, and “emergency” loans, which help farmers

resume operations after a disaster, id. pt. 1945. Under the

USDA’s regulations, a farmer seeking a farm credit or benefit

must first ask the Department for a loan application, which the

USDA is required to disburse. See id. § 1910.4(b) (“All persons

requesting an application will be provided [one].”). 

After receiving an application, a farmer is then required to

submit her completed application to a local county committee,

the members of which are selected by other farmers from that

county. See Pigford v. Glickman, 206 F.3d 1212, 1214 (D.C.

Cir. 2000). The local county committee initially determines

whether the applicant is eligible for the program, and USDA

staff members ultimately grant or deny the application. See 7

C.F.R. §§ 1910.5, 1910.4(i). The USDA has promulgated

criteria upon which the local committees are to rely in making

eligibility decisions, including citizenship, legal capacity,

education and farming experience, farm size, inability to obtain

sufficient credit elsewhere, and “character” (which emphasizes

credit history and reliability). See id. §§ 1941.12 (operating loan

criteria), 1943.12(a) (ownership loan criteria), 764.4 (emergency

loan criteria). 

Any farmer who believes the USDA denied her application

for a program loan or benefit on the basis of gender or any other

prohibited basis may file a civil rights complaint with the

Secretary of the USDA and/or the USDA’s Office of Civil

Rights (“OCR”). See id. § 15.6. The Department and/or OCR

may then conduct an investigation and institute compliance

proceedings, if needed. See id. §§ 15.8-.10. To effectuate

compliance, the Secretary may refer the matter to the

Department of Justice or institute any other applicable

proceedings under state or local law. Id. § 15.8(a).

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If a farmer is dissatisfied with the USDA’s response to her

discrimination complaint, she may sue in federal court under

ECOA. The Act makes it “unlawful for any creditor to

discriminate against any applicant with respect to any aspect of

a credit transaction . . . on the basis of race, color, religion,

national origin, sex or marital status, or age.” 15 U.S.C. §

1691(a). ECOA creates a private right of action against

creditors, including the United States, who violate its antidiscrimination provisions, and it makes such creditors “liable to

the aggrieved applicant for any actual damages sustained by

such applicant acting either in an individual capacity or as a

member of a class.” Id. § 1691e(a). Exhaustion of

administrative remedies is not required before an ECOA suit

may be filed, and prevailing Appellants may recover attorney’s

fees. Id. § 1691e(d). 

B

The Appellants filed a three-count complaint in the United

States District Court for the District of Columbia, seeking $3

billion in money damages under ECOA, as well as both

compensatory and equitable relief under the APA and the

Declaratory Judgment Act, 28 U.S.C. § 2201(a). To buttress

their claims, the Appellants filed 1,823 declarations, which

purported to show that the Department “allowed, indeed

supported, unconscionable disparate impact [through USDA’s

lending programs] around the country.” The Appellants’

statistics expert, Patrick M. O’Brien, also filed a report, which

purported to provide empirical evidence of “the adverse affects

[sic] of a discriminatory system.” The Department moved to

dismiss the complaint under FED. R. CIV. P. 12(b)(6), and the

Appellants moved for class certification under FED. R. CIV. P.

23.

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Before ruling on the propriety of class certification, the

District Court dismissed the Appellants’ failure-to-investigate

claim on three grounds. First, the District Court concluded that

the USDA’s failure to investigate the Appellants’ complaints did

not constitute a “credit transaction” within the meaning of

ECOA, 15 U.S.C. § 1691(a). Second, the court held the APA’s

“abuse of discretion” standard does not cover the USDA’s

failure to investigate Appellants’ complaints because ECOA

provided an alternative “adequate remedy.” Third, the District

Court concluded Appellants’ claims for money damages arising

from the USDA’s failure to investigate their complaints are

barred by the doctrine of sovereign immunity. 

In light of the court’s dismissal of the failure-toinvestigate claim, the Appellants based their motion for class

certification solely upon their discrimination claim.

Accordingly, the Appellants filed an amended complaint, along

with a renewed motion for certification of two subclasses.

“Subclass 1” consists of female farmers who asked for loan

application forms but did not receive them. “Subclass 2”

consists of female farmers who received, completed, and

submitted their loan application forms but did not garner a loan.

The amended complaint also dropped the Appellants’ demand

for $3 billion in damages and asked only for “compensatory

damages appropriate for proof at trial.” 

The District Court denied the Appellants’ renewed

motion to certify the class on three grounds. First, the court

concluded that the Appellants failed to satisfy Rule 23(a)’s

commonality requirement because there had not “been a

substantial showing that would permit the inference that

members of the class suffered from a common policy of

discrimination that pervaded all of the challenged decisions.”

Second, the court concluded that the class could not be certified

under Rule 23(b)(2) because the claims for monetary relief

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predominated over the claims for equitable relief. Third, the

court concluded the class could not be certified under Rule

23(b)(3) for the same reason it did not satisfy Rule 23(a)’s

commonality requirement: The Appellants “adduced no

evidence . . . establishing that it is or ever was actually USDA

policy to refuse to give loan application forms to women,” and

individual justifications for any loan denials would predominate

over questions common to the putative class. 

The District Court stayed the proceedings so that the

Appellants could seek interlocutory review of the denial of class

certification on their discrimination claim, as well as the

dismissal of their failure-to-investigate claim. In our discretion,

we granted the Appellants’ petitions for interlocutory review of

the class certification denial. We have jurisdiction over the

District Court’s dismissal of their failure-to-investigate claim

under 28 U.S.C. § 1292(b). See FED. R. CIV. P. 23(f); In re

Lorazepam & Clorazepate Antitrust Litig., 289 F.3d 98, 105-06

(D.C. Cir. 2002). The parties (with the help of three amici

curiae) then fully briefed and argued both issues before a merits

panel. Compare In re Veneman, 309 F.3d 789, 791 (D.C. Cir.

2002) (denying a 23(f) petition “because the critical questions

required to resolve it are entirely unbriefed”).

II. DISCRIMINATION CLAIM

Appellants’ first assignment of error is that the District

Court erroneously declined to certify their putative class as to

the “discrimination claim.” To justify class certification,

Appellants must first satisfy four threshold requirements,

demonstrating that: 

(1) the class is so numerous that joinder of all members is

impracticable, (2) there are questions of law or fact

common to the class, (3) the claims or defenses of the

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representative parties are typical of the claims or defenses

of the class, and (4) the representative parties will fairly and

adequately protect the interests of the class. 

FED. R. CIV. P. 23(a). If all four prerequisites under Rule 23(a)

are met, then Appellants must also show that their claims fit

within one of the subsections of Rule 23(b). See Amchem

Prods., Inc. v. Windsor, 521 U.S. 591, 613-16 (1997). Rules

23(b)(2) and (b)(3)—the two subsections at issue in this

case—have different requirements depending primarily on the

nature of the relief sought: Certification under the former is

appropriate where a class seeks declaratory or injunctive relief,

while certification under the latter is appropriate where, inter

alia, the “‘final relief relates exclusively or predominantly to

money damages.’” In re Veneman, 309 F.3d at 792 (quoting

FED. R. CIV. P. 23(b)(2) advisory committee notes).

The District Court declined to certify the class because the

Appellants failed to show “commonality” under Rule 23(a)(2),

and they failed to meet the requirements of Rule 23(b)(2) or

23(b)(3). Because we conclude the District Court neither erred

as a matter of law nor abused its discretion in finding the

putative class members lack “commonality” under Rule

23(a)(2), we affirm without considering whether certification

would also be improper under Rule 23(b).

A

Appellants argue that the District Court erred by failing to

find commonality within Subclass 1 under Rule 23(a)(2). We

review the District Court’s decision for abuse of discretion. See

Hartman v. Duffey, 19 F.3d 1459, 1471 (D.C. Cir. 1994);

Wagner v. Taylor, 836 F.2d 578, 586 (D.C. Cir. 1987). 

Each member of Subclass 1 allegedly requested an

application for a farm loan and had her request denied.

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Although the District Court recognized that “[p]laintiffs have

assembled an impressive collection of sworn statements

asserting that a great many women have been flatly refused . . .

loan application forms,” it nonetheless declined to certify

Subclass 1. The court noted that the Appellants’ declarations

“might have been sufficient to support certification of subclasses

of women who suffered discrimination at the hands of particular

county committees,” but variations between the declarations

precluded a finding of “commonality” for purposes of a

nationwide class action. 

The Appellants concede that the Department offered

varying reasons for denying their requests, but Appellants argue

these variations are irrelevant “because there is no basis for

refusing to distribute loan applications to requestors, pursuant to

USDA’s own regulations.” See 7 C.F.R. § 1910.4(b) (“All

persons requesting an application will be provided [one].”).

Appellants further concede that they have no statistical proof

that women’s requests for loan applications were treated

differently from men’s. Nevertheless, Appellants assert that a

mountain of anecdotes proves that their claims are “not mere

coincidence.” In the absence of any data to the contrary, the

Appellants claim, the District Court should have presumed that

622 aggrieved women’s declarations warranted the certification

of the class.

We disagree. As we have previously noted: 

[T]here is more to a showing of commonality than a

demonstration that class plaintiffs suffered discrimination

on the basis of membership in a particular group. . . . While

in a case alleging intentional discrimination, such as this

one, a plaintiff need not isolate the particular practice and

prove that such practice caused the discrimination,

plaintiffs must make a significant showing to permit the

court to infer that members of the class suffered from a

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common policy of discrimination that pervaded all of the

employer’s challenged employment decisions.

Hartman, 19 F.3d at 1472 (emphasis in original). Thus,

commonality under Rule 23(a) requires a named plaintiff to

show (i) discrimination (ii) against a particular group (iii) of

which the plaintiff is a member, plus (iv) some additional factor

that “permit[s] the court to infer that members of the class

suffered from a common policy of discrimination.” Id.

Hartman’s “common policy” requirement is consistent with the

Supreme Court’s teaching in General Telephone Co. of the

Southwest v. Falcon, 457 U.S. 147 (1982). There the Court

noted:

Conceptually, there is a wide gap between (a) an

individual’s claim that he has been [discriminated against],

and his otherwise unsupported allegation that the company

has a policy of discrimination, and (b) the existence of a

class of persons who have suffered the same injury as that

individual, such that the individual’s claim and the class

claims will share common questions of law or fact . . . . For

respondent to bridge that gap, he must prove much more

than the validity of his own claim.

Id. at 157-58.

The District Court did not abuse its discretion in concluding

that Appellants failed to “bridge th[e] gap” between their

individual claims and Hartman’s “common policy” requirement.

Some members of Subclass 1 (namely, the 622 declarants)

offered anecdotal evidence that they were personally denied loan

applications, and some of those same women reported

discriminatory treatment by USDA officials. For example, the

declarants allege that USDA officials told them “they were too

early to apply for a loan, too late to apply for a loan, that they

need not bother filling out an application because they were not

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eligible to receive a loan, or that their husbands should apply.”

Appellants’ Br. at 11. Certainly these allegations may give the

declarants standing to bring individual suits. However, the

declarants’ allegations did not require the District Court to infer

the existence of a “common policy of discrimination” that

affected the non-declarants, as well. The bald allegation that the

declarants and non-declarants alike are unified by a “common

policy” of gender discrimination is insufficient to show the

District Court abused its discretion under Hartman and Falcon.

As the Appellants candidly admit, there is no evidence that

women were more likely than men to be refused loan

applications. See Appellants’ Br. at 13. Moreover, the

declarants’ anecdotal accounts differ widely, and their

complaints of discrimination are interspersed with

nondiscriminatory evidence and innocuous explanations.

Compare Joint Appendix (“J.A.”) 538 (“I was told there were no

f[u]nds available.”), and J.A. 540 (“I was told that there were no

funds or applications available.”), with J.A. 536 (A USDA

official “told me that farming business was too risky for

women.”). Thus, even taking as true all of the declarants’

factual allegations, the District Court was nevertheless left to

wonder whether some of the declarants (to say nothing of the

silent, non-declarants) were victimized by gender

discrimination. Because the Appellants failed to “bridge th[e]

gap” between their individual and class-wide claims, we cannot

fault the District Court for refusing to take a leap of faith. 

A recent case from the Sixth Circuit illustrates our point. In

Reeb v. Ohio Dep’t of Rehab. & Corr., — F.3d —, 2006 WL

162836 (6th Cir. Jan. 24, 2006), four female prison guards filed

a putative class action against their employer, alleging it

violated Title VII by treating them differently from the male

guards. Seeking to represent all past and present female

employees at the prison, the named plaintiffs claimed to have

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been the victim of the defendant’s “general policy” of

discrimination on the basis of sex. The district court certified

the class and found Rule 23(a)’s commonality requirement met

“[b]ecause the issue of whether the Defendant violated Title VII

will be common to the class.” Id. at *5 (internal quotation

marks and citation omitted). The appeals court reversed for an

abuse of discretion because “[i]f this were the test, every

plaintiff seeking to certify a class in a Title VII action would be

entitled to that certification.” Id.; see also Bacon v. Honda of

Am. Mfg., Inc., 370 F.3d 565, 571 (6th Cir. 2004) (“Conclusory

allegations and general assertions of discrimination are not

sufficient to establish commonality.” (citing Falcon, 457 U.S. at

157)); Sprague v. Gen. Motors Corp., 133 F.3d 388, 397 (6th

Cir. 1998) (“It is not every common question that will suffice [to

show commonality], however; at a sufficiently abstract level of

generalization, almost any set of claims can be said to display

commonality. What we are looking for is a common issue the

resolution of which will advance the litigation.”). 

After conducting a “rigorous analysis” of the Appellants’

claims under Rule 23(a), Hartman, 19 F.3d at 1473, the District

Court in this case exercised its considered judgment and

concluded that class certification would not advance the

litigation. Cf. Pigford v. Glickman, 185 F.R.D. 82 (D.D.C.

1999) (chronicling the arduous process of handling a similar

case as a class action). Even if Subclass 1 were certified, the

District Court concluded, the outcome of this case would

nevertheless turn on a series of individualized inquiries into

application-distribution practices in more than 2,700 FSA

offices across the country over the last quarter-century. Unlike

the Reeb court, we need not consider whether the contrary

conclusion would have constituted an abuse of discretion. For

present purposes, it is sufficient to note that while it might not

be reversible error to certify a subclass under these or similar

circumstances, see Chiang v. Veneman, 385 F.3d 256, 265-66

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3

 Even were we to consider Rule 23(b), the similar lack of

“generally applicable grounds” under (b)(2) and “predominance”

under (b)(3) would doom the certification. See pp. 7-8, supra.

(3d Cir. 2004) (affirming the certification of a class akin to

Subclass 1), it is also not an abuse of discretion for the District

Court to refuse to do so, see Eubanks v. Billington, 110 F.3d 87,

96 (D.C. Cir. 1997).

We hasten to emphasize that we do not hold that anecdotal

evidence alone is inherently insufficient to justify class

certification. In this case, however, the District Court did not

abuse its discretion by refusing to certify Subclass 1 for lack of

commonality under Rule 23(a)(2) on the diverse affidavits

before it, and the large number of silent, potential class

plaintiffs. As a result, we have no occasion to consider the

District Court’s alternative holdings under Rule 23(b).3 See

Amchem, 521 U.S. at 613-14.

B

Appellants mount a two-prong challenge to the District

Court’s analysis of Subclass 2, which comprises women

applicants who were allegedly denied farm loans on the basis of

their gender. The District Court concluded that the geographic

dispersal and decentralized organization of the USDA’s loan

offices “cut[] against any inference for class action

commonality.” Moreover, the court noted that the Department

offered a wide array of objective, highly individualized

justifications (such as the “failure to meet collateral

requirements, poor credit, [and] insufficient income”) for

denying the Appellants’ loan requests. Appellants first claim the

District Court erred as a matter of law. Second, Appellants

claim the District Court abused its discretion by ignoring the

facts. We address (and reject) each claim in turn.

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1

Appellants argue that the District Court erred as a matter of

law in its evaluation of commonality within Subclass 2. In

Appellants’ view, “[t]he District Court created its own entirely

new standard for determining how subjective a system must be

in order to demonstrate a common policy of discrimination.”

Appellants argue that Subclass 2 is unified by the USDA’s

policy of delegating standardless discretion to local loan-making

officers, and “[t]his Court” has held that “a common policy [of

discrimination] exist[s] when significantly subjective decisionmaking operates on a national basis with discriminatory results.”

Accordingly, Appellants criticize “the District Court’s

substitution” of its own legal standard—which Appellants dub

a “subjectivity spectrum”—“in lieu of well-established

precedent.” Our review of the question of law is de novo. See,

e.g., Gov’t of Rwanda v. Johnson, 409 F.3d 368, 372 (D.C. Cir.

2005).

Appellants are wrong about the law of “[t]his Court.” We

have never held that subjective decision-making processes

require a district court to find commonality for purposes of class

certification. See, e.g., Hartman, 19 F.3d 1472 (holding

plaintiffs’ challenge to the defendant’s “subjective” decisionmaking did not warrant a finding of commonality: “While

plaintiffs’ statistics may have demonstrated that discrimination

against women applicants to the six [] job categories was afoot,

nothing in the record so far permits the additional inference that

class members suffered a common injury.” (emphasis in

original)); see also Wagner, 836 F.2d at 594-95. The District

Court’s application of Hartman was not erroneous as a matter of

law. 

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2

Appellants next argue that the District Court abused its

discretion by failing to properly consider evidence of

commonality within Subclass 2. Appellants rely on 859

declarations from disappointed female loan applicants, who

“attested that they were denied loans based upon their gender.”

However, by the Appellants’ own count, 41% of these declarants

have no idea why their loan applications were denied. See

Appellants’ Br. at 21 (asserting that 27% received “no official

written response” to their loan applications, while an additional

14% received “the equivalent of no response”). The District

Court was well within the bounds of its discretion to find a lack

of commonality where two out of every five of the Appellants’

own declarants—to say nothing of the silent nondeclarants—would be forced to prove at trial that individual

reasons for their loan denials were not pretextual (e.g., one

woman had poor credit, another had no collateral, a third was

victimized by gender discrimination, etc.). For the same reasons

that justified the District Court’s conclusion that Subclass 1 does

not exhibit “commonality,” the record in this case does not

compel the conclusion that the USDA discriminated against

women across the class, even if some individual declarants in

Subclass 2 properly stated a discrimination claim. See Hartman,

19 F.3d at 1472.

Appellants’ efforts to demonstrate commonality through

rudimentary statistics are equally unavailing. Appellants’

statistics expert, Patrick O’Brien, admits that his analysis does

not account for the possibility that women receive fewer loans

because they apply for fewer loans, and he recognizes that

women may receive smaller loans because they operate smaller

farms. Moreover, there are countless other, non-discriminatory

explanations for any patterns in the USDA’s lending data. For

example, women may have relatively less credit than men;

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women may have relatively less wealth than men; or women

may apply for loans at a younger—and thus riskier—age than

men. Instead of conducting a relatively simple statistical

analysis (such as a multiple regression) to control for any or all

of these variables, O’Brien simply reported a series of

elementary cross-tabulations, from which it is impossible—as a

statistical matter—to draw meaningful conclusions. See, e.g.,

WILLIAM H.GREENE,ECONOMETRIC ANALYSIS 100-01, 147-60

(4th ed. 2000); Frank T. Denton, The Significance of

Significance: Rhetorical Aspects of Statistical Hypothesis

Testing in Economics, in THE CONSEQUENCES OF ECONOMIC

RHETORIC 163 (Arjo Klamer, Donald N. McCloskey & Robert

M. Solow eds., 1988). The Appellants’ expert concedes that

“[n]o statistical tests for significance were done” on his data.

Compare Bazemore v. Friday, 478 U.S. 385, 399 n.9 (1986)

(holding the Appellants’ empirical evidence of discrimination

was admissible to show disparate treatment because it showed

“statistically significant” disparities). 

Given the numerous shortcomings in the Appellants’ efforts

to show commonality within Subclass 2, the District Court did

not abuse its discretion in denying the Appellants’ certification

motion under Rule 23(a)(2). Accordingly, we have no occasion

to consider the District Court’s alternative holdings under Rule

23(b). See Amchem, 521 U.S. at 613-14.

III. FAILURE-TO-INVESTIGATE CLAIM

Appellants’ final argument is that the District Court erred

in dismissing their “failure-to-investigate” claim prior to ruling

on their motion for class certification. The District Court

concluded the USDA’s alleged failure to investigate Appellants’

complaints is not reviewable under ECOA, which makes it

“unlawful for any creditor to discriminate against any applicant

with respect to any aspect of a credit transaction” on the basis

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of sex. 15 U.S.C. § 1691(a) (emphasis added). The court

concluded, as a matter “of course,” that a failure to investigate

does not fit within the plain meaning of a “credit transaction.”

The District Court further concluded that Appellants’ failure-toinvestigate claim is not reviewable under the APA because

ECOA provides an adequate alternative remedy. See 5 U.S.C.

§ 704 (limiting the applicability of the APA to a “final agency

action for which there is no other adequate remedy in a court”).

Appellants argue the District Court erred under both ECOA

and the APA. First, the Appellants urge us to construe liberally

the meaning of a “credit transaction” under 15 U.S.C. § 1691(a)

and to hold their failure-to-investigate claim is reviewable under

ECOA. Alternatively, the Appellants argue their claim is

reviewable under the APA because the USDA’s regulations

empower aggrieved applicants to file discrimination claims,

which the Department is legally obligated to investigate. Our

review is de novo. See, e.g., Johnson, 409 F.3d at 372.

We first reject the Appellants’ argument under ECOA

because even a liberal interpretation of “credit transaction” does

not encompass “failure to investigate a discrimination

complaint.” Cf. Bissette v. Colonial Mortgage Corp. of D.C.,

477 F.2d 1245, 1247 (D.C. Cir. 1973) (noting “‘liberal

construction’ and interpretation based on legislative purpose can

only go so far. Where the meaning of the statute and regulations

is clear, a contrary reading would become destruction of the

statutory scheme.”). True, the phrase “credit transaction” is not

without ambiguity, but it is not a normal understanding of those

words in the English language that they would include the

failure to investigate complaints of discrimination in an

underlying event even if the underlying event falls within the

meaning of the phrase “credit transaction.”

USCA Case #05-5084 Document #953116 Filed: 03/03/2006 Page 17 of 18
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Again, there is a certain ambiguity in the term. The

Department has gone to the trouble of issuing a defining

regulation. See 12 C.F.R. § 202.2(m). The regulatory scheme

of which that is a part may become the stuff of APA litigation

upon remand, but so far as an action at law based on this section

of the ECOA, that simply is not within the plain meaning of the

statute.

This leaves the Appellants’ claim that the USDA’s failures

to investigate discrimination claims are reviewable under the

APA for another day. We follow this course of nonaction

because the record is little developed on that argument, and the

parties’ briefs have given short-shrift to the issue before us. As

our review of this claim is discretionary in the first place, and as

the order certifying the 12(b)(6) ruling for interlocutory review

was without prejudice to further decision by the merits panel of

this court, we decline to exercise our discretion and remand the

APA claim for further proceedings in the District Court. See In

re Veneman, 309 F.3d at 796. 

CONCLUSION

For the reasons stated above, the District Court’s denial of

the Appellants’ motion for class certification is affirmed. The

District Court’s dismissal of the Appellants’ failure-toinvestigate claim under ECOA is affirmed, but its dismissal of

the Appellants’ failure-to-investigate claim under the APA is

remanded.

So ordered.

USCA Case #05-5084 Document #953116 Filed: 03/03/2006 Page 18 of 18