K-Mar Industries, Inc. v. United States Department of Defense
752 F. Supp. 2d 1207
W.D. Okla.2010Background
- K-Mar Industries sues DOD and Army seeking APA declaratory and injunctive relief and FOIA production at Fort Sill, Oklahoma.
- Plaintiff alleges defendants violated insourcing procedures by deciding to insource Training Support Center work now performed by plaintiff.
- Defendants move to dismiss under Rule 12(b)(1), arguing ADRA/28 U.S.C. § 1491(b) creates exclusive CFC jurisdiction and that CDA also vests exclusive jurisdiction in CFC.
- APA action seeks non-monetary relief; district court retains jurisdiction unless Congress curtailed it by other statutes.
- Court analyzes whether ADRA ousts district court jurisdiction and whether CDA applies; also addresses FOIA exhaustion
- Court denies defendants’ motion; FOIA claim denial of exhaustion dismissed; overall ruling is that the action may proceed in district court
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does ADRA strip district court jurisdiction over this insourcing challenge? | K-Mar: ADRA applies and vests exclusive CFC jurisdiction. | DOD/Army: ADRA exclusive to CFC deprives district court of APA jurisdiction. | ADRA does not divest district court of jurisdiction |
| Is plaintiff's claim 'in connection with a procurement' under ADRA? | Insourcing decision relates to procurement decisions. | Insourcing is not a procurement; ADRA applies only to procurement objections. | Action not in connection with a procurement |
| Are the claims contractual in nature such that CDA applies to divest district court jurisdiction? | Claims arise from insourcing procedures, not contract disputes. | CDA could bar district court if essentially contractual. | Not contractual; CDA does not strip district court jurisdiction |
| Should FOIA be dismissed for failure to exhaust administrative remedies? | Exhaustion not required where agency delays and responses exist. | FOIA exhaustion required in some contexts. | FOIA exhaustion dismissal denied; proceed |
| What is the overall jurisdictional posture of the case given APA, ADRA, and CDA? | APA provides waiver; removal of ADRA concerns should not bar relief. | ADRA/CDA could foreclose APA relief in district court. | Court retains APA jurisdiction; motion to dismiss denied |
Key Cases Cited
- Normandy Apartments, Ltd. v. U.S. Dept. of Housing and Urban Development, 554 F.3d 1290 (10th Cir. 2009) (APA waiver limited to contract claims; regulations-based claims may proceed in district court)
- Fostvedt v. United States, 978 F.2d 1201 (10th Cir.1992) (consent prerequisite for jurisdiction against United States)
- United States v. Mitchell, 463 U.S. 206 (1983) (sovereign immunity requires consent to sue)
- Kokkonen v. Guardian Life Ins. Co. of America, 511 U.S. 375 (1994) (Rule 12(b)(1) factual vs facial attacks and jurisdictional facts)
- American Federation of Government Employees, AFL-CIO v. United States, 258 F.3d 1294 (Fed.Cir.2001) (ADRA’s scope and 'interested party' definition borrowed from CICA)
- Distributed Solutions, Inc. v. United States, 539 F.3d 1340 (Fed.Cir.2008) (definition of 'procurement' under OFFPA)
- Open America v. Watergate Special Prosecution Force, 547 F.2d 605 (D.C.Cir.1976) (agency processing delays may affect FOIA obligations)