Court Opinion

ID: 6990217
Source: CourtListenerOpinion
Date Created: 2022-07-24 03:23:36.758618+00
Date Added: 2024-06-11T16:09:34.888758
License: Public Domain

GAJARSA, Circuit Judge,
dissenting.
I respectfully dissent from the majority opinion for two reasons. First, I believe that the majority’s analysis is in direct conflict with Supreme Court precedent, precedent of this court, and the statutory scheme promulgated by Congress, which provides for judicial review pursuant to the Administrative Procedure Act only when no other adequate remedy is available. Second, the majority opinion allows the plaintiffs an opportunity to collaterally attack a clear and controlling precedent of this court and moreover it frustrates the legislative purpose of the Tucker Act.
Specifically, under the rubric of affording Con Ed an opportunity to seek equitable relief, the majority opinion countenances an end run around the Tucker Act by expanding the government’s limited waiver of sovereign immunity far beyond its statutory constraints. The majority reaches its conclusion by linking a truism — that the Court of Federal Claims (“CFC”) cannot issue injunctions — with a non sequitur — that the CFC cannot otherwise provide Con Ed effective relief. The majority opinion condones the plaintiffs’ forum shopping by permitting the twenty-two plaintiffs to avoid the jurisdiction of the CFC where they have submitted the same claims on overlapping and similar legal theories that have been rejected by this court in Yankee Atomic Electric Co. v. United States, 112 F.3d 1569 (Fed.Cir.1997). The majority x*ationalizes the concept of forum shopping on the premise that “the federal code tolerates a variety of forum shopping.” This case certainly does not present such an instance.
This circuitous journey begins with Congress’ recognition in the late 1980’s that *649the government’s uranium facilities would have to be decontaminated and decommissioned. It was estimated that the total cost of the clean up would exceed $20 billion over a period of forty years. In response to the clean up requirement Congress enacted the Energy Policy Act of 1992 (“EPACT”). 42 U.S.C. §§ 2297(g) et seq. (1994 & Supp. 2000). The EPACT created the Uranium Enrichment Decontamination and Decommissioning Fund (“Fund”). The Fund accumulated monies by assessing a charge to domestic utility companies that purchased and used the enrichment services and from public funds to be appropriated by Congress. The EPACT also limited the collection of funds from the domestic utilities after the earlier of 15 years after October 24, 1992 or the collection of $2.25 billion (adjusted for inflation). See § 2297g-l(e). The EPACT imposed the special assessment on each domestic utility that had benefited from the government’s enrichment services. It further provided that the domestic utilities could pass this cost through to the consumers by treating the special assessment as “a necessary and reasonable current cost of fuel, which shall be fully recoverable in rates in all jurisdictions in the same manner as the utility’s other fuel cost.” § 2297g-l(g).
The government has annually billed the domestic utilities since October, 1992 for their pro-rata share of the special assessment. After paying the special assessments, the domestic utilities challenged the assessment in the CFC, requesting a reimbursement of monies paid alleging that the special assessment breached their contracts with the federal government by retroactively increasing the cost of the uranium enrichment services and that it constituted an illegal exaction — a taking in violation of the Takings Clause of the Fifth Amendment. The CFC, in one of the cases then pending, held that the special assessment was an illegal exaction under the Takings Clause and granted the plaintiff a money judgment. Yankee Atomic Electric Co. v. United States, 33 Fed. Cl. 580 (1995). On appeal, however, this court in Yankee Atomic Electric Co. v. United States, 112 F.3d 1569, reversed the CFC’s finding that the Act was “a general exercise of Congress’ taxing power for the purpose of addressing a societal problem rather than an act that retroactively increases the price charged to contracting parties for uranium enrichment services.” Yankee Atomic, 112 F.3d at 1577. Basically, this court held that the special assessment did not breach any contract rights and Yankee Atomic had no property right that had been taken by the assessment.
The Supreme Court denied certiorari, Yankee Atomic Electric Co. v. United States, 524 U.S. 951, 118 S.Ct. 2365, 141 L.Ed.2d 735 (1998), whereupon the remaining plaintiffs, understanding their predicament, forged a new theory as a collateral attack against the Yankee Atomic legal roadblock and the EPACT. Having followed one avenue that they originally believed to be correct, but which proved to be futile, they now adopt similar and overlapping legal theories buttressed by their request of alternative remedies. They now seek a declaratory judgment and injunctive relief in the United States District Court for the Southern District of New York. This appeal is the positive result obtained by the plaintiffs in their forum shopping quest to obtain alternative relief on substantially the same legal premises. The utility companies, plaintiffs below, sought a declaratory judgment that the special assessment: (1) constitutes a taking of a vested property interest by their fixed price contracts with the federal government without just compensation under the Fifth Amendment (Takings) (Count I); (2) violates the Due Process Clause of the Fifth Amendment because the assessment is irrational and arbitrary, abrogates the plaintiffs’ due process right to receive enrichment services at the contractually specified prices and unfairly imposed retroactive liability on the plaintiffs for continuation that the plaintiffs did not *650create (Count II); (3) violates the Due Process Clause in that it constitutes an illegal, irrational, unfair and disproportionate tax imposed on an- exceedingly narrow base and “unlawfully impairs” their rights under the contracts and settlement agreements with the government (Count III); and (4) violates their fixed price contracts and Settlement agreement with the government for enrichment services by retroactively imposing additional costs based on the use of those services (Counts IV — VI).1 The plaintiffs have not specifically requested monetary damages from the federal district court but have sought to enjoin the government from collecting additional monies under the special assessment provisions and to bar enforcement of these provisions. The issue before the court is whether the relief sought is akin to an action in damages. This action cannot be so camouflaged to be anything but an action for damages.2
The government argued that all of the CFC’s actions arise out of the “same series of transactions, facts and circumstances” as the case filed at the federal district court and the case should not proceed simultaneously in both forums. The federal district court rejected the government’s motion to stay the proceedings in favor of the CFC proceedings, holding that the plaintiffs could not obtain injunctive relief from the CFC so as to escape the continuing obligation to make payments into the Fund. Consolidated Edison Co. of N.Y. v. United States, 30 F.Supp.2d 385 (S.D.N.Y.1998). The government then moved the court to transfer the plaintiffs’ case to the CFC pursuant to 28 U.S.C. § 1631. The decision on interlocutory appeal before us is the federal district court’s denial of that motion. Consolidated Edison Co. of N.Y. v. United States, 1999 WL 212686 (S.D.N.Y. Apr.12, 1999).
The district court’s holding denying the government’s motion to transfer relied on In re Chateaugay Corp., 53 F.3d 478 (2d Cir.1995) and Eastern Enterprises v. Apfel, 524 U.S. 498, 118 S.Ct. 2131, 141 L.Ed.2d 451 (1998), reasoning that where the challenge is solely for the taking of money (i.e., compelled payments) Congress could not have intended to relegate such a suit to the Tucker Act because the “just compensation” for such a taking is simply a “dollar for each dollar” taken.3 The district court also rejected . the government’s position that the plaintiffs only sought money damages barred by Section 702 of the APA holding that the utilities only sought prospective relief. Furthermore, it concluded that under the “adequate remedy” provisions of Section 704 of the APA the CFC could not have jurisdiction over the plaintiffs’ due process claims; moreover, the CFC could not grant equitable relief. The plaintiffs in the case before the district court alleged that they had paid six special assessments to the Fund totaling $569 million, but they did not make a demand for a refund of the payments as part of their prayer for relief.4
The majority opinion falls into the same open logic pit, which swallows the reason*651ing of the district court. First, it ignores the fact that the district court premised its jurisdictional argument on the basis that the CFC could not address the plaintiffs’ due process claims. This is error. In fact, in the context of the so-called “illegal exaction” doctrine, enunciated most prominently in Eastport S.S. Corp. v. United States, 178 Ct.Cl. 599, 372 F.2d 1002, 1009 (Ct.Cl.1967), the CFC does have jurisdiction to consider due process claims. See Mallow v. United States, 161 Ct.Cl. 446 (1963). See also Commonwealth Edison, 46 Fed.Cl. at 42-43 (2000) (discussing additional cases). Second, instead of focusing on whether the CFC can provide the plaintiffs an adequate remedy, the majority opinion focuses on whether or not the CFC can enjoin the federal government from collecting any future payments from the plaintiffs. But this inquiry does not address the focal question posed by the APA, to wit, whether an adequate remedy is available in the CFC.
The plaintiffs’ plain and underlying premise is to circumvent the binding precedent of this court established by Yankee Atomic. The majority states that “instead of seeking refunds of assessments paid,” the plaintiffs have sought declaratory judgment that the EPACT is unconstitutional and seek an injunction on the enforcement of the special assessments. It concludes that the case “presents ... [an] instance where the federal code tolerates a variety of forum shopping.” However, the majority fails to recognize that it has opened a one-way forum shopping street. It allows a challenge by a plaintiff, who has failed to win before the Federal Circuit, to pursue an additional remedy by restructuring its complaint seeking declaratory judgment and injunctive relief. When the federal government fails before the Federal Circuit, it has no such remedy. For the government, this result constitutes a “tails you win, heads I lose” scenario in which the precedents of this court can be ignored by private litigants essentially at will. I do not believe that is what Congress intended.
Moreover, contrary to the majority’s positing of the issue as one of whether the APA waived sovereign immunity for an action in the district court because the plaintiffs seek equitable relief, the real issue should be posed as whether or not the district court has subject matter jurisdiction to grant declaratory and injunctive relief to a party making a due process challenge to a government assessment, when the same party is concurrently suing the government in the CFC for a refund of money already paid? The question simply stated is whether the CFC can provide an adequate remedy; if so, this action is barred because the federal district court lacks jurisdiction. Despite the numerous cases littering the intersection of the Tucker Act and Section 704 of the APA, no clear answer has yet emerged. The majority opinion only adds to the cacophony.
The plaintiffs have cited 28 U.S.C. §§ 1331 and 1361 to show subject matter jurisdiction for their claim for equitable relief. However, federal question jurisdiction under 28 U.S.C. § 1331 does not by itself operate as a waiver of sovereign immunity. See Kester v. Campbell, 652 F.2d 13, 15 (9th Cir.1981). The plaintiffs would need to identify an independent basis for the waiver of sovereign immunity to maintain their claim in the federal district court. The majority has found that waiver in Section 702 of the APA, 5 U.S.C. § 702. However, Section 702 is unavailing if there is an adequate remedy in a court that can provide appropriate relief.
In the instant case, given that plaintiffs have already paid some of the special assessments and have filed their claims for refunds in the CFC to recoup those payments, an adequate remedy exists for purposes of Section 704. A decision by the CFC would effectively moot any prospective relief that the district court could afford. There are two possible scenarios. One, if the CFC upholds the lawfulness of the special assessments, then no lawful exaction exists from which prospective re*652lief could be provided. Second, if the CFC holds the special assessment unconstitutional, then its decision would be binding and it is absurd to believe that the DOE would continue to require the domestic utilities to make payment of unlawful exac-tions. Moreover, it is reasonable to presume that the CFC, pursuant to its authority under 28 U.S.C. § 1491(a)(2), can provide appropriate prospective relief. As was stated by Justice Scalia in dissent:
Respondent can assert immediately a claim for money damages in Claims Court, which if successful, will as effectively establish its right as would a declaratory judgment in district court. Since there is no allegation that the Secretary will not honor in the future a Claims Court judgment that would have not only precedential but collateral es-toppel effect ... the ability to bring an action in Claims Court with regard to disallowance decisions already made provides effective prospective relief as well.
Bowen v. Massachusetts, 487 U.S. 879, 926, 108 S.Ct. 2722, 101 L.Ed.2d 749 (1988) (Scalia, J., dissenting).
By the plain language of its terms, Section 704 of the APA allows judicial review only when “there is no other adequate remedy in a court.” Bennett v. Spear, 520 U.S. 154, 175, 117 S.Ct. 1154, 137 L.Ed.2d 281 (1997). Section 704 provides that where agency action is otherwise reviewable in a court and an adequate remedy is available in conjunction with that review, the APA’s waiver of sovereign immunity under Section 702 is not available. See Kanemoto v. Reno, 41 F.3d 641, 644 (Fed.Cir.1994); Mitchell v. United States, 930 F.2d 893, 895-96 (Fed.Cir.1991).
The majority relies on Bowen v. Massachusetts, 487 U.S. 879, 108 S.Ct. 2722, 101 L.Ed.2d 749, to establish the interplay of Section 702 and 704 and parallels the present case with Boiven; however, Bowen is clearly distinguishable on its facts and the majority’s reliance on Bowen is misplaced. In Bowen, the Commonwealth of Massachusetts brought suit to reverse a federal agency’s refusal to reimburse the state for certain categories of Medicaid expenditures. Bowen, 487 U.S. at 886-87, 108 S.Ct. 2722. Pursuant to the Medicaid program, the federal government made quarterly advance payments to the state in anticipation of the future reimbursable costs of the state’s program. When the state was notified by the Secretary of Health and Human Services (“HHS”) that certain of its claimed expenditures had been disallowed, the state brought suit in the federal district court requesting declaratory and injunctive relief setting aside the Secretary’s decision. The United States challenged the district court’s jurisdiction to hear the case contending that the Tucker Act provided exclusive jurisdiction for the suit in the Court of Federal Claims (previously the U.S. Claims Court). Id. at 890, 108 S.Ct. 2722.
The Supreme Court discussed the term “money damages” as used in the APA, 5 U.S.C. § 702:
The term “money damages,” we think, normally refers to a sum of money used as compensatory relief. Damages are given to the plaintiff to substitute for a suffered loss, whereas specific remedies are not substitute remedies at all, but attempt to give the plaintiff the very thing to which he was entitled. Thus, while in many instances an award of money is an award of damages, [o]cca-sionally a money award is also a specie remedy. Courts frequently describe equitable actions for monetary relief under a contract in exactly those terms.
Bowen, 487 U.S. at 895, 108 S.Ct. 2722 (citation omitted).
The Supreme Court further observed that “managing the relationships between the states and the federal government that occur over time and involve constantly shifting balance sheets requires a different sort of review and relief process.” (emphasis added). Id. at 905 n. 39, 108 S.Ct. 2722. The Court further noted that rele*653vant statute created “complex questions” with “an intricate ongoing relationship” between the federal government and the State raised in Medicaid disallowance decisions. Id. at 901 n. 31, 108 S.Ct. 2722. Flowing from these observations, the Supreme Court determined that the district court properly had jurisdiction because the case presented issues for which a district court “would be in a better position to evaluate than a single tribunal.” The Court then determined that the case was not one in which “a naked money judgment against the United States will always be an adequate remedy.” Id. at 905, 108 S.Ct. 2722.
The facts in the present case are drastically different than those in Boiven. Here, no constantly shifting balance sheet or complex scheme exists; rather the amount that plaintiffs must pay is fixed and predetermined. Further, the only ongoing aspect of the EPACT is that money must be paid over a course of fifteen years instead of in one lump sum. Put differently, in the present case, unlike Bowen, the payment does not involve an amount that is dependent on constantly fluctuating multiple variables.
The majority also embraces the position that they are not determining whether or not the plaintiffs are entitled to the remedy they seek but only whether or not the district court has jurisdiction. However, in order to establish jurisdiction with the district court it had to determine first whether Section 702 waived sovereign immunity. It basically accepted the federal district court’s interpretation of Bowen, holding that Section 702 waives immunity because the relief sought is equitable in nature. The Supreme Court, however, has instructed that the “Bowen analysis of § 702, .... did not turn on distinctions between ‘equitable’ actions and other actions,” Dep’t. of the Army v. Blue Fox, Inc., 525 U.S. 255, 261, 119 S.Ct. 687, 142 L.Ed.2d 718 (1999). Specifically, the Supreme Court stated:
As Bowen recognized, the crucial question under § 702 is not whether a particular claim for relief is “equitable” (a term found nowhere in § 702), but rather what Congress meant by “other than money damages” (the precise terms of § 702). Bowen held that Congress employed this language to distinguish between specific relief and compensatory, or substitute, relief.
Id. at 261, 119 S.Ct. 687.
The Supreme Court further explained that in Bowen:
We held that the State’s suit was not one “seeking money in compensation for the damage sustained by the failure of the Federal Government to pay as mandated; rather, it [was] a suit seeking to enforce the statutory mandate itself, which happens to be one for the payment of money.”
Id. at 262, 119 S.Ct. 687.
Therefore, it is clear that the Bowen decision cannot be used as a predicate to grant jurisdiction to the federal district court in the case. It seems plain, that under the Bowen analysis, the plaintiffs’ claim is precisely the type of suit that is properly before the Court of Federal Claims rather than the district court, because a “complex scheme” of federal interaction has not been raised. That is, “the district court is not in any better position to understand and evaluate the claim than a single tribunal.” The dispute does not involve an “intricate ongoing relationship” between the parties and there is no need for prospective relief because an adequate remedy is available — money damages. As was stated by Justice Scalia in his dissent in Boiven: “If the jurisdictional division established by Congress [by § 702] is not to be reduced to an absurdity, the line between damages and specific relief must surely be drawn on the basis of the substance of the claim, and not its mere forum.” Id. at 915, 108 S.Ct. 2722. To put the answer bluntly, the plaintiffs are glorifying form over substance. We are allowing them to pursue another avenue to *654eventually obtain money damages from the federal government.
Moreover, the logic promulgated by the dissent in Bowen is persuasive. The majority surely could not have meant that the Tucker Act can be by-passed at will simply by rephrasing a complaint in declaratory judgment terms — something that could occur in virtually every case exactly as the parties did in this case. Many cases decided since Bowen have limited it basically to its facts; however, it has created and continues to generate much mischief. It is time that the Supreme Court apply the coup de grace to Bowen; otherwise courts will continue to be confused, like the majority in this case, and place many cases outside the jurisdiction of the CFC.
I would hold that the district court lacks jurisdiction under Section 702 because the CFC can provide an adequate remedy for purposes of Section 704.

. These allegations are the same as the plaintiffs’ amended complaint filed in the CFC in the parallel cases. See Commonwealth Edison Co. v. United States, 46 Fed. Cl. 29, 35 (2000), appeal pending.

. If it quacks like a duck, waddles like a duck, struts like a duck, it must be a duck.

. It should be noted that the majority at least has not pursued the same legal reasoning as the federal district court. It has not premised its conclusions on either Chateaugay or Eastern Enterprises, recognizing perhaps the limitations of those decisions in establishing the legal support for their conclusions since in both of those cases no monies were paid to the respective funds prior to the declaratory and injunctive relief actions being filed.

.Does this failure imply that the plaintiffs have forsaken the recovery of past payments, namely the $569 million previously paid, or will they continue to pursue the past amounts if they obtain a favorable interpretation of the EPACT before the Southern District and the Second Circuit? Will the CFC be bound by that ruling or by our Yankee Atomic decision in their continuing challenge?