Opinion ID: 499513
Heading Depth: 3
Heading Rank: 1

Heading: Burdens on Bidders

Text: 17 The argument that a private cause of action to remedy violations of the Small Business Act would unduly burden successful bidders was first made in Savini Constr. Co. v. Crooks Bros. Constr. Co., 540 F.2d 1355 (9th Cir.1974), in which the Ninth Circuit concluded that there was no implied federal right of action to enforce the Small Business Act. The court stated:Had [the successful bidder] known that, depending on the post-award outcome of the size appeal, it would be subject to suit for its profits, it might well have declined to accept the award. Or, having accepted, it might have refused to continue work on the contract following the Size Appeals Board determination that it was originally ineligible to bid. Finally, although [the successful bidder] might have continued to execute the contract, serious problems of quality and speed of work could have arisen given the possible deprivation of profits at the conclusion of the project. 18 Id. at 1359. Tombs repeats and expands on these propositions. Brief of Defendant-Appellee at 8-11. 19 This argument has been accorded less weight in the context of determining whether a state right of action to enforce the Small Business Act may exist. See Icono v. Jensen Constr. Co., 622 F.2d 1291, 1299 (8th Cir.1980) (mere threat of legal action, without more, is not sufficient ... to discourage either the submission of bids or the acceptance of a contract award); accord Tectonics, Inc. v. Castle Constr. Co., 753 F.2d 957, 963 (11th Cir.), cert. denied, 474 U.S. 848, 106 S.Ct. 143, 88 L.Ed.2d 118 (1985). We too find the argument less than compelling in this context. In the years since Cort v. Ash, 422 U.S. 66, 95 S.Ct. 2080, 45 L.Ed.2d 26 (1975), the courts have been extremely reluctant to imply a [federal] cause of action absent ... specificity on the part of the Legislative Branch. Cannon v. University of Chicago, 441 U.S. 677, 718, 99 S.Ct. 1946, 1968-69, 60 L.Ed.2d 560 (1979) (Rehnquist, J., concurring). The reluctance to imply private actions is particularly strong when a statute is completely silent. Because implied federal causes of action are disfavored, the argument found compelling in Savini must be seen in its context. Conversely, there is great reluctance to assume that Congress did intend to preempt state law with respect to a particular area when Congress was silent regarding the matter of preemption. See Part 4. While the Savini argument has some merit, in this case it must be balanced against the reluctance to find that state law has been preempted. 20 Moreover, to whatever extent the availability of a state common law remedy produces negative effects on successful qualified bidders, these effects are at least partially offset by the positive effects of such a remedy on other bidders. While we recognize that the possibility of being sued is one that no business views with enthusiasm, we believe that the principal effect of such a possibility is that bidders will take greater care to ensure that they meet the SBA's size standards. Finally, a state cause of action to enforce the Small Business Act would discourage businesses that are not small, like Tombs, from improperly attempting to secure set-aside contracts, see Tectonics, 753 F.2d at 963 n. 5.