Court Opinion

ID: 8409662
Source: CourtListenerOpinion
Date Created: 2022-11-02 17:05:47.970802+00
Date Added: 2024-06-11T16:47:42.304460
License: Public Domain

SENTELLE, Circuit Judge,
concurring in part and dissenting in part.
In considering whether the plaintiff ag-gregators have standing to sue, I, like the Court, begin with the same basic question: “We must ... determine whether the ag-gregators have a stake in the outcome of the suit[.]” Maj. Op. at 1243. Because I conclude that most of the aggregators do not have a concrete private interest in the outcome of this suit, I must respectfully dissent from Part II.A of the Court’s opinion.*
The PSPs’ assignment of rights to APCC is materially limited: “ ‘[The PSP] hereby assigns, transfers, and sets over to [the aggregator] for purposes of collection all rights, title, and interest of [the PSP] in [the PSP’s] claims, demands or causes of action’ for dial-around compensation.” What the Court sees as “a mere reflection” of a technical detail not affecting the substance of the relationship, I see as the first clue that the PSPs, not the aggregators, would be the only plaintiffs with a real stake in the outcome of this controversy.
The Supreme Court’s statements on the “irreducible constitutional minimum” of standing, under Article III, are straightforward: first and foremost, the plaintiff “must have suffered an injury in fact — an invasion of a legally protected interest which is (a) concrete and particularized, and (b) actual or imminent, not conjectural or hypothetical!.]” Lujan v. Defenders of Wildlife, 504 U.S. 555, 560, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992) (quotation marks, footnote, and internal citation omitted). Of course, as this Court recognizes, the party that actually suffered the injury in the first instance need not be the party to bring suit; under Vermont Agency of Natural Resources v. United States ex rel. Stevens, an assignee of the injured party’s claim may have standing to sue. 529 U.S. 765, 771-74, 120 S.Ct. 1858, 146 L.Ed.2d 836 (2000).
The doctrine of assignee standing does not wholly erase the basic requirements of standing, however. There are “assignments,” and then there are assignments. Only an assignment that gives the assignee an actual interest in the recovery is sufficient for standing.
The assignee standing doctrine recognized by the Supreme Court (and cited by this Court, Maj. Op. at 1243) clearly refers to an actual assignment of an interest that secures a portion of the recovery. See Vermont Agency, 529 U.S. at 773, 120 S.Ct. 1858 (“The FCA can reasonably be regarded as effecting a partial assignment of the Government’s damages claim.”). The cases cited in Vermont Agency as exemplifying “assignee standing” reflect this fact. See Poller v. Columbia Broadcasting System, Inc., 284 F.2d 599, 602 (D.C.Cir.1960), rev’d, 368 U.S. 464, 465, 82 S.Ct. 486, 7 L.Ed.2d 458 (1962) (plaintiff in antitrust suit was assignee of all of the *1251assets of the dissolved corporation (of which he was previously the sole shareholder)); Hazeltine Research, Inc. v. Automatic Radio Mfg. Co., 77 F.Supp. 493, 495 (D.Mass.1948) (plaintiff in patent license suit was assignee of parent corporation’s right to grant licenses under certain patents), aff'd, 176 F.2d 799 (1st Cir.1949), aff'd, 339 U.S. 827, 70 S.Ct. 894, 94 L.Ed. 1312 (1950); Manhattan Trust Co. v. Sioux City & N.R. Co., 65 F. 559, 568 (N.D.Iowa 1895) (intervenor assignee in suit at equity was entitled to redeem securities pledged by assignor to third party, upon assignee’s payment of the loan proceeds to that third party), aff'd sub nom. Hubbard v. Tod, 76 F. 905 (8th Cir.1896), aff'd, 171 U.S. 474, 19 S.Ct. 14, 43 L.Ed. 246 (1898); Vimar Seguros y Reaseguros, S.A. v. M/V Sky Reefer, 515 U.S. 528, 531, 115 S.Ct. 2322, 132 L.Ed.2d 462 (1995) (plaintiff in contract dispute was subrogat-ed pro tanto because, as injured party’s insurer, it had paid injured party compensation that it would recover in contract parties’ arbitration); Musick, Peeler & Garrett v. Employers Ins., 508 U.S. 286, 288, 113 S.Ct. 2085, 124 L.Ed.2d 194 (1993) (plaintiff in stock fraud suit was subrogat-ed because, as injured party’s insurer, it had paid injured party compensation that it would recover in civil suit). See also Titus v. Wallick, 306 U.S. 282, 286, 59 S.Ct. 557, 83 L.Ed. 653 (1939), quoted in Maj. Op. at 1244 (plaintiff assignee did have to account for the proceeds of the recovery and turn over the proceeds to the assignor, but assignor was obligated, under the terms of the assignment, “after paying the expenses of collection, to pay over one-half of the net recovery to [as-signee’s] wife, to discharge certain indebtedness of [assignee], and to pay the balance to [assignee].”).
The cases cited in Vermont Agency as exemplifying the accepted doctrine of “as-signee standing” share a common characteristic noticeably absent from the case before us: in each of those cases the “assignment” gave the putative plaintiff a direct share in the recovery. This necessary characteristic renders those cases consistent with Vermont Agency’s requirement that the putative plaintiff have “a concrete private interest in the outcome of the suit” in order to attain standing. 529 U.S. at 772, 120 S.Ct. 1858 (quoting Lujan, 504 U.S. at 573, 112 S.Ct. 2130) (quotation marks & brackets omitted).
Under Vermont Agency (consistent with its foundation, Lujan), an assignee plaintiff must both (1) seek to vindicate the injury to the assignor, and (2) hold an interest “consisting] of obtaining compensation for, or preventing, the violation of a legally protected right.” Vermont Agency, 529 U.S. at 772-73, 120 S.Ct. 1858. An assignment suffices for such an interest when the assignee actually receives the benefit of the compensation he receives. Where the “assignment” relationship is in substance a mere “agency” relationship such that the “assignee” enjoys no right to keep a part of the recovery, the irreducible constitutional minimum of standing is left unsatisfied.
In this case, the putative plaintiffs themselves recognize that the PSPs’ assignment of rights to aggregators such as APCC gives them no share in the recovery. “The aggregators’ compensation for billing and collection services is based on the number of payphones and telephone lines operated by their PSP clients.” Br. for Plaintiffs-Appellees at 5-6. The aggregators are a pass-through entity: “Aggregators are intermediaries between PSPs and IXCs for billing and collection. An aggregator ... collects the IXCs’ payments, and distributes those payments to its PSP clients.” Id. at 5.
*1252The contract cited by the Court reflects the pass-through nature of the “assignee-assignor” relationship. True, according to one part of the Agreement, the PSPs “assign[ ] ... for purposes of collection” the interest in Company’s claims. But we do not interpret the contract’s individual phrases apart from the rest of the contract; rather, we interpret the agreement “as a whole,” along with “all writings that are part of the same transaction.” See Restatement (Second) of Contracts § 202(2) (1979). Doubts raised by the “for purposes of collection” language of that portion of the contract are confirmed by the Amendment to APCC Services Agency Compensation Agreement, which notes that, far from taking on the rights and responsibilities of the PSPs en toto, APCC merely acts as the “PSP’s exclusive agent for billing and collection.” Amendment at 1 (emphasis added). APCC does nothing more than “tak[e] collective action on behalf of PSP and other[s] ... with similar claims.” Id. (emphasis added). APCC’s obligations to each PSP in this additional agreement stretch far beyond mere “obligation] to account for the proceeds of a suit brought on the claim.” Maj. Op. at 1244.
As noted above, APCC has no actual financial interest in the recovery. The Amendment confirms this. APCC’s compensation is determined by a schedule of variable fees determined by cmrent PSP call volume, not the historical PSP call volume at issue in the case before us. APCC Services Agency Compensation Agreement, Schedule A. See also San-dusky Memo (“To fund the suits, all plaintiffs are being required to agree to a quarterly assessment of their dial around compensation on a per call basis.”). True, if APCC’s collection efforts require APCC to provide “additional services ... over and above the services provided pursuant to the Agreement,” APCC could deduct costs (again, based on current call volume) from the PSPs’ recoveries, Amendment to APCC Services Agency Compensation Agreement at 2. But APCC has not alleged that such deductions are required in the present case, and we therefore have no occasion to determine whether such hypothetical deductions would be sufficient for standing.
The aggregators whose standing I find lacking advance an alternative theory that they have “associational standing.” Associational standing requires three elements: first, the association’s members must otherwise have standing to sue in their own right; second, the interest the association seeks to protect must be germane to its purpose; third, neither the claim asserted nor the relief requested must require the individual members to participate in the suit. Hunt v. Washington State Apple Advertising Comm’n, 432 U.S. 333, 343, 97 S.Ct. 2434, 53 L.Ed.2d 383 (1977). The aggregators assert that they meet each requirement and therefore have associational standing. I disagree.
An aggregator cannot have “associational standing,” because an aggregator is not an “association.” The assignors of rights to the aggregators do not thereby become members of the aggregators. Indeed, the aggregators have no members at all. “In determining whether an organization that has no members in the traditional sense may nonetheless assert associational standing, the question is whether the organization is the functional equivalent of a traditional membership organization.” Fund Democracy, LLC v. SEC, 278 F.3d 21, 25 (D.C.Cir.2002). The aggregators are no such thing. APCC Services, Inc., Davel Communications Group, Inc., Data Net Systems, L.L.C., Intera Communications Corp., Jaroth, Inc., and NSC Telem-anagement Corp. are all for-profit companies with contractual relationships with a *1253number of other companies. One corporation does not become a member of another corporation by reason of entering into contracts with it. The aggregators are in no sense “membership organizations.” They are not even “organizations.” They are incorporated entities-legal persons-and their clients are no more their “members” than a law firm’s clients are the firm’s “members.”
In sum, I would respond to the District Court’s certified question for interlocutory appeal with instructions to dismiss the complaint with respect to the aggregators that do not own PSPs either in whole or in part. I therefore dissent, respectfully, from Part II.A of the opinion of the Court.

 As noted by the Court, Maj. Op. at 1242 n. **, this discussion only applies to those plaintiff aggregators that do not own, wholly or in part, PSPs.