Larry Grant Construction v. Mills
2013 U.S. Dist. LEXIS 103360
D.D.C.2013Background
- LGC and LCITE challenged SBA's size determination under the APA, arguing LGC was not small when combined with LCITE’s receipts.
- LCITE was already an 8(a) program participant with greater annual revenues than LGC, creating potential affiliation for size purposes.
- SBA determined LGC and LCITE were affiliated and calculated their combined receipts including LCITE’s revenue from joint ventures.
- LCITE’s 2010 draft financial statement showed LCITE’s 51% stake in joint ventures, but the SBA could not confirm discounting of LCITE’s share.
- SBA relied on a mixture of worksheets using different assumptions about discounting joint venture revenues to determine size.
- OHA dismissed LCITE’s administrative standing; the SBA’s size determination was upheld in the OHA decision, prompting the instant suit.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether SBA miscalculated receipts by not discounting LCITE’s JV revenues | LGC and LCITE contend receipts were overstated by 51% JV revenue not discounted. | SBA used one of several forecasts; proceedings show the final numbers exceeded the threshold. | Court grants summary judgment for plaintiffs on this issue. |
Key Cases Cited
- Newdow v. Roberts, 603 F.3d 1002 (D.C. Cir. 2010) (standing concerns and limited need to address all plaintiffs)
- Carey v. Population Servs. Int'l, 431 U.S. 678 (U.S. 1977) (standing and jurisdictional considerations)
- International Union, United Auto., Aerospace & Agric. Implement Workers of Am. v. Brock, 783 F.2d 237 (D.C. Cir. 1986) (standing and jurisdiction considerations in agency actions)
- Horner v. National Treasury Employees Union, 854 F.2d 490 (D.C. Cir. 1988) (agency action must be supported by record evidence; not merely possible)
- Nat'l Gypsum Co. v. EPA, 968 F.2d 40 (D.C. Cir. 1992) (reasoned explanation required for agency model assumptions)
- U.S. Air Tour Ass’n v. FAA, 298 F.3d 997 (D.C. Cir. 2002) (reasonableness of agency methodology and assumptions)
- State Farm Mut. Auto. Ins. Co. v. M.M.A., 463 U.S. 29 (U.S. 1983) (arbitrary and capricious standard and deference to agency findings)
- DSE, Inc. v. United States, 3 F. Supp. 2d 1464 (D.D.C. 1998) (agency action review for arbitrariness under APA)