Free Notice (Other) - District Court of Federal Claims - federal

Case 1:04-cv-01389-GWM

Document 9-4

Filed 09/24/2004

Page 1 of 9

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16

DAVID V. SEYER, Arizona Bar No. 012345 _., _. LAW OFFICES OF DAVID V. SEYER 1761 E. McNair Drive, Suite 102 Tempe, AZ 95283-5002 2g[lhUFt 3 J 2 Telephone: 480-829-9400 CLE,r:II !:r: Telecopier:480-829-9565 _1_:,.._ E-Mail-: David.S [email protected] PAUL F. DAUER, California Bar No. 37428 LAW OFFICES OF PAUL F. DAUER 400 Capitol Mall, Suite 2950 Sacramento, California 95814 Telephone: (916)448-2431 Telecopier: (916) 448-2462 JENNIFER L. MCCREADY, California Bar No. 179262 BEST BEST & KRIEGER LLP 400 Capitol Mall, Suite 1650 Sacramento, California 95814 Telephone: [916) 325-4000 Telecopier: (916) 325-4010 Attorneys for Plaintiff FIRE-TROL HOLDINGS LLC

,...... .

.............

A_110:1_4 ' : _:.URT _ '_'_

UNITED STATES DISTRICT COURT DISTRICT OF ARIZONA

FIRE-TROL HOLDINGS LLC, 17 Plaintiff, 18 19 20 21 22 23 24 25 26 27 28 v. U.S. DEPARTMENT OF AGRICULTURE FOREST SERVICE, Defendant.

Case No. CV 03-02039-PHX-JAT Judge: James A. Teilborg PLAINTIFF FIRE-TROL'S OPPOSITION TO FOREST SERVICE'S OTION M TODISMISS FOR LACK OF SUBJECT MATTER JURISDICTION ORAL ARGUMENT REQUESTED

FIRE-TROL'S OPPOSITION TO FOREST SERV1CE'S MOTION TO DISMISS

Case 1:04-cv-01389-GWM

Document 9-4

Filed 09/24/2004

Page 2 of 9

1 2

TABLE OF CONTENTS Page

3 4 5 6 7 8 9 10 11 12 13 '14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

INTRODUCTION ...................................................................................................... ARGUMENT ............................................................................ ................................. I. THIS COURT HAS JURISDICTION OVER FIRE-TROL'S ADMINISTRATIVE PROCEDURE ACT AND COMPETITION IN CONTRACTING ACT CLAIMS .................................................................... A. This Court Has Jurisdiction Over Fire-Trol's APA Claims .................. B. This Court Has Jurisdiction Over Fire-Trol's CICA Claims ................ II. BECAUSE THE INSTANT CASE IS NOT A BID PROTEST, SCANWELL JURISDICTION IS IRRELEVANT ......................................... CONCLUSION ..........................................................................................................

1 1 1 1 4 6 6

,,

FIRE-TROL'S -i-

OPPOSITION TO FORES'I MOTION TO DISMISS

SERVICE'S

Case 1:04-cv-01389-GWM

Document 9-4

Filed 09/24/2004

Page 3 of 9

1 2

TABLE

OF AUTHORITIES Page

3 4 5 6 7 8 9 10 o_v _ O-©L0
_a:_<

Statutes 28 United States Code section 1331 ......................................................... 1, 2, 4, 5, 6 3 5 5 2 2 3 3 1

36 Code of Federal Regulations section 13804 (July 24, 1971) ................................ 41 United States Code section 253c ........................................................................... 48 Code of Federal Regulations ................................................................................. 5 United States Code section 551 .............................................................................. 5 United States Code section 553 ............................................. i................................ 5 United States Code section 553 (b) ......................................................................... 5 United States Code section 553 (c) ......................................................................... Federal Rules of Civil Procedure, rule 11 .................................................................. Federal Cases

11
12

o_ ffl_ if} w w g: j u_ o_J _ << ° __ _e_

13 14

Califano v. Sanders, 430 U.S. 99 (1977) ................................................................... Matter of Fire-Trol Holdings, LLC (GAO Case No. B-290674) ............................... Rodway v. United States Dep 't ofAgric., 514 F.2d 809 (D.C. Cir. 1975) ..................................................................................................................... Sugar Cane Growers Coop. of Florida v. Veneman, 289 F.3d 89 (D.C. Cir. 2002) ..............................................................................................................

1 5 3 3

8_ 15 _< 16 17 18 19 20 21 22 23 24 25 26 27 28

:.

-

ii -

EIRE-TROL'S OPPOSITION TO DISMISS TO FOREST SERVICE'S MOTION

Case 1:04-cv-01389-GWM

Document 9-4

Filed 09/24/2004

Page 4 of 9

i 2 3 4 5 6 7 8 9 10
tflcD (0 U)

INTRODUCTION Defendant Service") United States Department of Agriculture, Forest Service ("Forest

once again has made a groundless,

and less than diligent, motion, delaying ability to secure relief from the Forest

Plaintiff Fire-Trol Holdings, Service's

LLC's ("Fire-Trol")

arbitrary and capricious actfon.

Without addressing 28 U.S.C. section 1331, the the Forest Service argues that this

specific jurisdictional Court lacks jurisdiction necessary jurisdiction and Competition Defendant's

basis identified in the Complaint, over this action.

In fact, section 1331 provides this Court the Procedure Act ("APA")

to proceed with both the Administrative Act ("CICA") claims.l

in Contracting

For the reasons discussed below,

motion should be denied and Defendant ARGUMENT

ordered to answer the Complaint.

o_

11 12 13 14 15 16 17 18 I. THIS COURT

- o_ o_ I/) _ w_Tjt_

_< _z <<
_ O

HAS JURISDICTION PROCEDURE ACT CLAIMS 2 of Fire-Trol's

OVER

FIRE-TROL'S IN

ADMINISTRATIVE CONTRACTING

ACT AND COMPETITION

__
WtD,(

8_

As stated in paragraph jurisdiction

Complaint,

this Court "has subject matter

of this action pursuant to 28 U.S.C. section 1331 as raising issues under the that federal district courts "shall laws, or

[APA] and federal [CICA]. ''2 Section 1331 provides have original jurisdiction

of all civil actions arising under the Constitution, Defendant

19
20 21 22 23 24 25 26 27 28

treaties of the United States." jurisdiction in its motion.

entirely neglects to address section 1331 over the APA and CICA claims is proper

In fact, jurisdiction

under 28 U.S.C. section 1331. A. This Court Has Jurisdiction Over Fire-Trol's APA Claims over APA claims pursuant Defendant

It is well established

that district courts have jurisdiction

to 28 U.S.C. section 1331. See Califano v. Sanders, 430 U.S. 99, 105 (1977).

i Defendant's motion, which is made without citation to, or discussion of, pertinent authority and appears designed to delay, treads perilously close to a Rule 11 violation, _articularly on the heels of the motion to dismiss denied by the Court on May 27, 2004. Because the Complaint states the basis for this Cot/rt's jurisdiction on its face, Fire-Trol understands the Forest Service motion to be a substantive challenge to this Court's jurisdiction, rather than solely a challenge to the form of the Complaint.
SACRAMENTOZIDM\I5966.1 -

1-

F1RE-TROL'S OPPOSITION TO FOREST SERVICE'S MOTION TO DISMISS

Case 1:04-cv-01389-GWM

Document 9-4

Filed 09/24/2004

Page 5 of 9

1 2 3 4 5 6 7 8 9 10 11 12 13 ,4 15 16 17 18 19 20 21 22 23 24 25 26 27 28

Forest Service's

cursory motion is wholly unclear as to the basis for its implied claim that As discussed below, the Forest of this

section 1331 does not provide this Court jurisdiction.

Service action is subject to the APA and, through section 1331,. to jurisdiction Court.

The APA generally requires an agency to provide the public notice and the opportunity as ... an agency statement of general or particular applicability and future effect designed to implement, interpret, or prescribe law or policy or describing the organization, procedure, or practice requirements of an agency... 5 U.S.C. § 551. The Forest Service has announced that it will not purchase wildland fire retardants to be heard on any proposed "rule." 5 U.S.C. § 553. The APA defines "rule"

announcements purchases

fe ocyanid dw ,'onlyp rch se r ret ant conta nin
containing yellow prussiate of soda (hereafter, "YP Soda," also known as sodium are "agency statement[s] of general or particular applicability" to agency of wildland fire retardant. 3 The rules also have "future effect" because they are with the 2005 procurement cycle. See Complaint, ¶ 65. Finally, they an risk" a policy or practice requirement of the Forest Service by implementing a policy to purchase only gum-thickened retardants. See Forest Service to ban YP Soda and to require gum

stated to commence implement

overall ban on a product that the Forest Service believes presents an "environmental and implementing

Motion at 2-3. Thus, the Forest Service decisions

3 The APA applies to an "agency statement of general or particular applicability." 5 U.S.C. § 551 (emphasis added). The Forest Service's apparent position that a rule which is not a general "prohibition or ban on the use or sale of fire retardants containing sodium ferrocyanide" (Forest Service Motion at 2) is not subject to the APA is contrary to the language of the APA and unsupported by citation to other authority. As reflected in the Complaint passages quoted by Defendant in its motion, Fire-Trol never contended that the Forest Service role wholly prevented all sales ofwildland fire retardant. However, since effectively all of Fire-Trol's sales are to entities purchasing in total or partial reliance on Forest Service Specification 5100-304b, the Forest Service action defacto acts as a ban on Fire-Trol's fire retardant products. Declaration of Joe GrigeI, filed herewith ("Grigel Decl."), ¶¶ 2-3.
SACRAMENIOXJDM\I5966.1 -

2

-

FIRE-TROL'S OPPOSITION TO FOREST SERVICE'S MOTION TO DISMISS

Case 1:04-cv-01389-GWM

Document 9-4

Filed 09/24/2004

Page 6 of 9

i 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

thickeners

in fire retardants

are "rules" subject to the APA. of Agriculture has expressly committed its agencies,

The United States Department including procedures,

the Forest Service, to be bound by the APA's public notice and participation stating: The public participation requirements prescribed by 5 U.S.C. 553 (b) and (c) will be followed by all agencies of the Department in rule making relating to public property, loans, grants, benefits, or contracts ....

36 Fed. Reg. 13804 (July 24, 1971); see also Sugar Cane Growers Coop. ofFlorida

v.

Veneman, 289 F.3d 89, 95 n.5 (D.C. Cir. 2002); Rodway v. United States Dep "tof Agric., 514 F.2d 809, 814 (D.C. Cir. 1975) (recognizing Secretary to comply thereafter Department of Agriculture with the procedural that "the regulation fully bound the Because the

demands of the APA.").

has committed that its agencies, including the Forest Service, requirements, the Forest Service must containing YP Soda

will comply with the APA's notice and comment

comply with the APA in adopting its rule not to purchase retardants and in adopting its rule to require gum-thickeners.

To the extent that the Forest Service

might be arguing that it is not bound by the APA, that argument must fail. The Forest Service disingenuously merely a determination attempts to characterize its rulemaking as

of an agency requirement

with respect to a particular procurement. As the Forest

However, the Forest Service's

own motion belies that characterization.

Service states, it "has determined

that it no longer will procure wildland fire retardants present an avoidable environmental risk."

that contain [YP Soda], because such products Forest Service Motion at 2 (emphasis not to purchase fire retardants added).

That is, the Forest Service admits its intent not just a

containing

YP Soda in any future procurements,

single, upcoming procurement. Further, the Forest Service's amendment to Specification policy is being implemented through a de facto

5100-304b,

pursuant to which fire retardant products are ::'

SACRAMENTOklDM\15966.1

-

3

-

FIRE-TROL'S OPPOSITION SERVICE'S MOTION

TO FOREST TO DISMISS

Case 1:04-cv-01389-GWM

Document 9-4

Filed 09/24/2004

Page 7 of 9

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

listed on the qualified products list ("QPL"). 4 The Forest Service is acting to prevent FireTrol products containing YP Soda from completing testing required by Specification 5100-304b and from being listed as fully qualified on the QPL. See'Declaration of Rob Crouch, filed herewith ("Crouch Decl."), ¶¶ 5-7 and Exhibit A thereto; Grigel Decl., ¶ 4. The Forest Service's current refusal to test formulas containing YP Soda will negatively affect Fire-Trol's competitive position should Fire-Trol be successful in this litigation because qualification of its products is being delayed. See Crouch Decl., ¶ 8. In addition to having an effect on future Forest Service procurements, the Forest Service rules challenged in this action also affect Fire-Trol sales to other government entities. Specification 5100-304b and the associated QPL are used or relied upon by other government entities for their purchases of wildland fire retardant. See, e.g., Declaration of Paul F. Dauer, filed herewith, Exhibit A (California procurement standards). incorporating federal

Thus, the rule banning YP Soda is having a current effect on Fire-Trol, and

will potentially affect numerous future procurements if Fire-Trol is successful in this action and the Forest Service rules are overturned. See Crouch Decl., ¶ 8. Because the challenged rules are stated with reference to all future procurements, and are affecting the

retardant qualification process, the Forest Service's rules are not merely a discretionary decision of what to purchase in a particular procurement, but are "rules" subject to the requirements of the APA. B. This Court Has Jurisdiction Over Fire-Trol's CICA Claims

As reflected in paragraph 2 of Fire-Trol's Complaint, section 1331 also provides jurisdiction over the CICA claims. The Competition in Contracting Act is a "law[]... of

4 The Forest Service has not circulated proposed changes to Specification 5100-304b for public comment. The first procurement solicitations in which the Forest Service has indicated that it will implement its new ban on YP Soda and requirement for gum thickener must be issued by this Fall, at the latest. Because that schedule does not practically permit time for adoption of the new specifications pursuant to the APA, the Forest Service has manifested its intent to implement its changes to Specification 5100-304b without compliance with the APA requirements. To that end, the Forest Service has stated that it is currently testing retardants for
compliance with some different but undisclosed retardant specification. Crouch Decl., ¶ 8. SACRAMENTOUDM\I5966.1

4-

FIRE-TROL'S OPPOSITION TO FOREST SERVICE'S MOTION TO DISMISS

Case 1:04-cv-01389-GWM

Document 9-4

Filed 09/24/2004

Page 8 of 9

i

1 2 3 4 5 6 7 8 9 10 11 12 13 '14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

the United States" (28 U.S.C. § 1331), so actions arising under CICA fall under district , i court jurisdiction. The instant action arises under CICA because the action relates to CICA provides for specifications

limitation of competition in government contracting.

governing the establishment and use of a QPL in the procurement process. 41 U.S.C. § 253c; Federal Acquisition Regulations (48 C.F.R.), subpart 9.2. PlaintiffFire-Trol contends that Defendant Forest Service has failed to comply with procedure and competitive requirements of CICA in adopting and/or amending its specification. Thus, unless jurisdiction is otherwise precluded, section 1331 provides this Court jurisdiction over actions arising under CICA. In the context of a specific pending procurement, CICA actions generally are brought before the United States General Accounting Office ("GAO")or the Court of Federal Claims in a bid protest action. However, because the instant action does not involve a specific, pending procurement, jurisdiction does not lie with either the GAO or the Court of Federal Claims. As expressly noted in Paragraph 3 of the Complaint, /_A _ d (x"

Because the instant action involves the [Forest Service's] improper rule-making in violation of the APA and the CICA, junsd]ction is only proper before the United States District Courts. The [GAO]has previously held, in a protest involving Plaintiff Fire-Trol, that the GAO does not have jurisdiction to hear such disputes, which challenge the [Forest Service's] rulemaking in general, because GAO's jurisdiction extends only to specificprocurement actions. (Matter of Fire-Trol Holdings, LLC (GAO Case No. B-290674).) The Forest Service did not address this jurisdictional contention in its motion.

Even if a procurement were pending, it is questionable whether Fire-Trol could challenge anything more than the specific terms of that solicitation. In order to challenge

the overall violation of CICA in the Forest Service rulemaking, Fire-Trol must bring the action before a federal district court. Accordingly, regardless of whether this Court would have jurisdiction over a specific pending procurement, the Forest Service has not established (and can not establish) that this Court is divested of jurisdiction over review of specifications for a QPL which were adopted contrary to the requirements of CICA. Because this Court has jurisdiction over the CICA claims under 28 U.S.C. section 1331,
SACRAMENTOXJDM\15966.1 - 5 FIRE-TROL'S OPPOSITION TO FOREST SERVICE'S MOTION TO DISMISS

Case 1:04-cv-01389-GWM

Document 9-4

Filed 09/24/2004

Page 9 of 9

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19

and that jurisdiction has not been committed to any other forum, Defendant's motion to dismiss for lack of jurisdiction should be denied.

II.

BECAUSE THE INSTANT CASE IS NOT A BID PROTEST, SCANWELL JURISDICTION IS IRRELEVANT

Fire-Trol does not dispute that federal district courts were expressly granted jurisdiction over bid protests, or that such jurisdiction has lapsed and is no longer available. Defendant's discussion of Scanwelljurisdiction, is irrelevant.' The instant dispute is not a bid protest. while historically interesting,

CONCLUSION Defendant Forest Service has entirely failed to cite any law, affidavits, or other factual support to establish its position that this Court lacks jurisdiction. As pled by

Plaintiff Fire-Trol in its Complaint and discussed fully above, this Court has jurisdiction over the action under 28 U.S.C. section 1331. Defendant's motion to dismiss for lack of jurisdiction must be denied, and Defendant should be ordered to answer the Complaint.

Dated:

June "_ _ , 2004

BEST BEST & KRIEGER LLP

21 22 23 24 25 26 27 28
SACRAM ENTOUDM\15966.1 -

;.

JENNIFER MCCREADY L. _ Attorneys for Plaintiff FIRE-TROL HOLDINGS LLC

6-

F1RE-TROL'S OPPOSITION SERVICE'S MOTION

TO FOREST TO DISMISS