CROWLEY GOVERNMENT SERVICES, INC., APPELLANT v. GENERAL SERVICES ADMINISTRATION AND ROBIN CARNAHAN, IN HER OFFICIAL CAPACITY AS ADMINISTRATOR OF THE GENERAL SERVICES ADMINISTRATION, APPELLEES
No. 21-5242
United States Court of Appeals FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued February 15, 2022 Decided July 1, 2022
Appeal from the United States District Court for the District of Columbia (No. 1:21-cv-02298)
James Y. Boland argued the cause for appellant. With him on the briefs were Nicholas M. DePalma and Kevin W. Weigand.
Steven Hazel, Attorney, U.S. Department of Justice, argued the cause for appellees. With him on the brief were Brian M. Boynton, Acting Assistant Attorney General, Mark B. Stern, Attorney, and Nitin Shah, General Counsel, General Services Administration. Stephanie R. Johnson and R. Craig Lawrence, Assistant U.S. Attorneys, entered appearances.
Before: SRINIVASAN, Chief Judge, HENDERSON and JACKSON*, Circuit Judges.
Opinion for the Court filed by Circuit Judge
KAREN LECRAFT HENDERSON, Circuit Judge: Crowley Government Services, Inc. sued the General Services Administration and its Administrator (collectively, GSA), seeking declaratory and injunctive relief to halt the GSA‘s purported practice of interfering with payments owed to Crowley under its contract with the United States Transportation Command (TRANSCOM). Crowley argues that the Administrative Procedure Act (APA),
We disagree. Crowley‘s action against the GSA in district court is not “at its essence” contractual because Crowley does not seek to enforce or recover on the contract with TRANSCOM. Nor does Crowley “in essence” seek monetary relief from the federal government in district court. Rather, it requests declaratory and injunctive relief that, if granted, would have considerable value independent of (and not negligible in comparison to) any monetary recovery Crowley may ultimately attain in other proceedings. Accordingly, we reverse and remand to the district court.
I. BACKGROUND
In November 2016, Crowley,2 which “provides marine solutions, energy, and logistical services in domestic and international markets,” entered a procurement contract with TRANSCOM, a unit of the Department of Defense (DOD).3 Compl. ¶¶ 12, 19, No. 21-cv-2298, Crowley Gov‘t Servs. v. GSA (D.D.C. Aug. 30, 2021), reprinted in Joint Appendix (J.A.) 6, 8-9. Crowley agreed to “prоvide[] various logistical, planning, and transportation coordination services to assist [TRANSCOM] with managing a large and complex network of moving goods and cargo for the [DOD].” Id. ¶ 20, reprinted in J.A. 9. Under the contract, government shippers send Crowley orders for cargo shipments to and from DOD facilities within the continental United States. Crowley, which does not handle or take possession of the cargo, coordinates the shipment process by subcontracting to third parties the transportation of the cargo from its origin and to its destination.
This dispute arises from the GSA‘s audits of Crowley‘s invoices to TRANSCOM for payment for services provided under the contract. The GSA, which all parties agree is not party to the contract, asserted authority to audit Crowley‘s invoices pursuant to the Transportation Act. See
In January 2020, Crowley objected to the GSA‘s asserted authority to conduct the audits and submitted a claim to TRANSCOM‘s Contracting Officer challenging various categories of the NOCs under a provision of the contract it argued was governed by the Contract Disputes Act. See
In May 2021, Crowley filed suit against TRANSCOM in Claims Court, alleging breach of contract for nonpayment of services and seeking money damages and declaratory relief, as TRANSCOM had not reimbursed Crowley for the payments offset by the GSA. Compl. ¶¶ 1, 49-60, Crowley, No. 21-cv-1405 (PEC) (Fed. Cl. May 27, 2021), ECF No. 1. After the United States moved to dismiss, Crowley amended its complaint, adding an alternative count against the GSA under
Several days after filing its amended complaint in Claims Court in late August 2021, Crowley filed a two-count complaint against the GSA in distriсt court. Count I alleged that the GSA exceeded its statutory authority by improperly auditing Crowley‘s invoices and issuing NOCs in violation of (1) the Transportation Act,
In its Prayer for Relief, Crowley sought (1) a judgment declaring that the Transportation Act does not authorize the GSA to audit the contract; (2) a judgment declaring that the GSA‘s NOCs, which contradict the Contracting Officer‘s final decisions, violate the Contract Disputes Act; and (3) an injunction prohibiting thе GSA from conducting additional audits of Crowley‘s invoices and issuing NOCs. It expressly stated, however, that it “seeks no monetary relief . . . or other contractual
The district court granted the GSA‘s motion to dismiss for lack of jurisdiction and denied Crowley‘s motion for a preliminary injunction as moot. Id. at *1, *12. It concluded that it lacked subject matter jurisdiction because Crowley “has a contract dispute with the government exceeding $10,000 in value, and the forum prescribed by statute to hear such disputes is the Court of Federal Claims.” Id. at *6. Crowley‘s complaint seeking declаratory and injunctive relief is “in essence” a claim for monetary relief, the district court reasoned, because the non-monetary relief Crowley seeks is “‘negligible in comparison’ to the uncollected contractual proceeds at issue.” Id. at *9 (quoting Kidwell, 56 F.3d at 284). It reached this conclusion by comparing what it characterized as Crowley‘s “primary harm“—$180,000 in personnel time lost to reviewing and challenging the NOCs—to the $37 million in alleged overcharges, or what it deemed the “real amount at stake.” Id.; see Compl. ¶¶ 81-82, reprinted in J.A. 16 (“Crowley estimates that it has already cost Crowley at least $180,000 in personnel time attempting to review, assess, and challenge the NOCs. . . . [It] has expended significant resources challenging GSA‘s authority to conduct audits and make determinations that are contrary to the Contracting Officer‘s” final decisions.).
The district court also determined that Crowley‘s claims are in essence contractual because the GSA‘s “audits have no significance outside the context of collection on the contract” and Crowley‘s complaint would not exist “were it not for certain rights to payment promised in the [c]ontract.” Crowley, 2021 WL 4940953, at *10-11 (citing Spectrum Leasing Corp. v. United States, 764 F.2d 891 (D.C. Cir. 1985)). Finally, the district court rejected Crowley‘s ultra vires claim as a “side-door attempt to invoke the district court‘s jurisdiction” and to “escape the jurisdictional strictures imposed by the Tucker Act.” Id. at *11. Crowley appealed.
“In granting the [GSA‘s] motion to dismiss, the [d]istrict [c]ourt issued a final appealable order, which this court has jurisdiction to review pursuant to
II. ANALYSIS
The United States and its agencies are generally immune from suit in federal court absent a clear and unequivocal waiver of sovereign immunity. See Kalodner v. Abraham, 310 F.3d 767, 769 (D.C. Cir. 2002) (citing Lane v. Pena, 518 U.S. 187, 192 (1996)). Via the APA, the Congress has provided a limited waiver of sovereign immunity for claims against the United States “seeking relief other than money damages” for persons “adversely affected
The Tucker Act gives the United States Court of Federal Claims jurisdiction
to render judgment upon any claim against the United States founded either upon the Constitution, or any Act of Congress or any regulation of an executive department, or upon any express or implied contract with the United States, or for liquidated or unliquidated damages in cases not sounding in tort.
Because the Tucker Act does not expressly forbid the relief sought by Crowley, the district court correctly identified the critical overarching question to be whether the statute “impliedly forbids” such relief. Crowley, 2021 WL 4940953, at *6 (quoting
A. TUCKER ACT JURISDICTION
Our longstanding test for determining whether a claim falls within the exclusive jurisdiction of the Clаims Court pursuant to the Tucker Act appears straightforward. “[A]n action against the United States which is at its essence a contract claim lies within the Tucker Act and . . . a district court has no power to grant injunctive relief in such a case.” Megapulse, 672 F.2d at 967 (emphasis added). Whether a claim is “at its essence” contractual for the Tucker Act “depends both on the source of the rights upon which the plaintiff bases its claims, and upon the type of relief sought (or appropriate).” Id. at 968.
In examining “the source of the rights upon which the plaintiff bases its claims,” Megapulse‘s first prong, we recognize that “[c]ontract issues may arise in
Megapulse‘s second prong considers “the type of relief sought.” 672 F.2d at 968. Here, we are guided by our case law that has identified the “explicitly contractual remedy” of specific performance and the “prototypical contract remedy” of money damages as types of relief that are “specific to actions that sound in contract.” Perry Cap., 864 F.3d at 619 (quoting A & S Council Oil Co. v. Lader, 56 F.3d 234, 240 (D.C. Cir. 1995)). The crux of this inquiry, however, boils down to whether the plaintiff effectively seeks to attain monetary damages in the suit. Accordingly, under the second prong of Megapulse, “a claim is subject to the Tucker Act and its jurisdictional consequences if, in whole or in part, it explicitly or ‘in essence’ seeks more than $10,000 in monetary relief from the federal government.”6 Kidwell, 56 F.3d at 284 (citing Megapulse, 672 F.2d at 967-68); cf. Bowen, 487 U.S. at 916 (Scalia, J., dissenting) (“[D]istrict court jurisdiction is not established merely because a suit fails to pray for a money judgment.” (citing cases)). Narrowing our focus further, a plaintiff does not “in essence” seek monetary relief “as long as [the] complaint only requests non-monetary relief that has ‘considerable value’
With these principles in mind, we turn to Crowley‘s complaint in district court to determine if it is “at its essence” a contract claim. Megapulse, 672 F.2d at 967.
B. APPLICATION OF MEGAPULSE
1. Source of the Right
We begin with the source of the right upon which Crowley bases its claim. But we must first properly characterize Crowley‘s asserted right before we can proceed to identify its source. Crowley contends that it has the right “to be free from government action beyond [its] congressional authority,” Appellant‘s Br. 42, and that the GSA has infringed upon this right by auditing Crowley‘s invoices without authority under the Transportation Act,
We next identify the source of Crowley‘s asserted right. We conclude that the sources of Crowley‘s claimed right are the statutes identified in Crowley‘s complaint. Its claimed right sounds more in the nature of tort, not by virtue of its contract with TRANSCOM. To begin, Crowley “do[es] not seek to enforce any duty imposed upon” the GSA by Crowley‘s contract with TRANSCOM.” Perry Cap., 864 F.3d at 619. As all agree, the GSA owes no duty to Crowley under the contract. It is neither a party to, a beneficiary of nor an assignee under the Crowley-TRANSCOM contract. And Crowley did not seek in district court an order compelling the GSA to perform or fulfill any obligations to Crowley created by the contract.
Further, determining whether the GSA infringed Crowley‘s rights as alleged in the complaint requires primarily an examination
We find Crowley‘s claim against the GSA to fall within that category of cases identified in Megapulse in which “[c]ontract issues may arise” but “the action itself is not founded on a contract.” 672 F.2d at 968. Specifically, we find convincing Crowley‘s analogy of its claim to the common law claim of tortious interference with contractual relations. See Appellant‘s Reply Br. 7 n.3; Tr. of Oral Arg. at 10 (Crowley “analogize[s] [its] case to a tortious interference-type case“); see also Megapulse, 672 F.2d at 969 (“[P]ublic officials may become tort-feasors by exceeding the limits of their аuthority.” (quoting Land v. Dollar, 330 U.S. 731, 738 (1947))). The elements of tortious interference are “substantially similar in most jurisdictions” and commonly include: “(a) a contract or valid business relationship or expectancy; (b) knowledge by the defendant of the contract or relationship; (c) intentional interference by the defendant which induces the breach of contract or relationship; (d) the absence of justification; and (e) resulting damages.” 9 Stuart M. Speiser et al., American Law of Torts § 31:45 (2022) (noting that some courts do not consider breach of contract to be essential element of tortious interference claim). With the exception of damages, which Crowley explicitly disclaims in its complaint, Crowley has alleged, as part of its claim under the APA, the remaining elements of tortiоus interference: it has a valid contract with TRANSCOM; the GSA knew of the contractual relationship as it sought to review Crowley‘s invoices for payment under the contract; the GSA intentionally interfered with the contract through allegedly unauthorized audits and the issuance of NOCs; and the GSA allegedly lacked authority for its actions under the Transportation Act and the Contract Disputes Act. The Tucker Act, however, does not extend to the Claims Court jurisdiction of tort claims.8
We believe the district court made several errors in its examinatiоn of the source of the right. First, as explained, it misidentified the right Crowley sought to vindicate in its action against the GSA. Crowley, 2021 WL 4940953, at *10 (identifying “rights to certain monies” rather than asserted
Third, the district court mistakenly relied on our 1985 Spectrum decision. See Crowley, 2021 WL 4940953, at *10; see also Appellees’ Br. 14 (“This case resembles Spectrum in all relevant respects.“). There, a software and hardware services provider in a contractual relationship with the GSA challenged the GSA‘s withholding of payment of certain invoices based on Spectrum‘s alleged failure to fulfill its contractual obligations. Spectrum, 764 F.2d at 892. Spectrum sued in district court for the GSA‘s alleged violations of the Debt Collection Act of 1982,
For these reasons, we conclude that the source of the right upon which Crowley bases its claim against the GSA is not its contract with TRANSCOM and therefore the complaint does not fall within the Claims Court‘s exclusive Tucker Act jurisdiction under the first prong of Megapulse.
2. Relief Sought
We turn next to “the type of relief sought.” Megapulse, 672 F.2d at 968. We conclude that Crowley‘s requested declaratory and injunctive relief is “not specific to actions that sound in contract.” Perry Cap., 864 F.3d at 619. Crowley seeks neither the “prototypical contract remedy” of damages, id. (quoting Lader, 56 F.3d at 240), nor “the classic contractual remedy of specific performance,” Spectrum, 764 F.2d at 894. And, critically, Crowley does not “in essence” seek more than $10,000 in
Crowley‘s complaint expressly “seeks no monetary relief” or money damages. Compl. ¶ 107, reprinted in J.A. 20; see also Tootle, 446 F.3d at 174 (first examining whether complaint explicitly requests monetary damages); Kidwell, 56 F.3d at 284, 285 (same, stating Tucker Act applies if complaint “explicitly” seeks more than $10,000 in damages). In its Prayer for Relief, as notеd earlier, supra at 7, Crowley seeks only declaratory and injunctive relief. Compl. Prayer for Relief ¶¶ A-C; see also Smalls v. United States, 471 F.3d 186, 190-91 (D.C. Cir. 2006) (consulting complaint‘s prayer for relief to determine remedy sought).
The resolution of our inquiry under the second prong of the test articulated in Megapulse accordingly turns on whether Crowley‘s complaint “in essence” seeks monetary relief. Kidwell, 56 F.3d at 284. It does not. “[M]ost importantly, the equitable relief sought by [Crowley] has significant value.” Tootle, 446 F.3d at 174-75. Crowley put forth a host of non-monetary benefits it would attain with a ruling in its favor in district court. These include: the ability to direct its resources to fulfilling its obligations under the contract rather than analyzing and challenging tens of thousands of audits and NOCs; the certainty of knowing whether the dispute resolution procedures under the Contract Disputes Act or the Trаnsportation Act apply; an answer to the question whether the GSA has authority to audit Crowley‘s invoices generated by its contract with TRANSCOM; and, perhaps most significantly, the ability to provide services to TRANSCOM and perform its contractual obligations free of the GSA‘s alleged interference. Compl. ¶¶ 82, 84, 85, 86, 87, reprinted in J.A. 16-17. The value of this non-monetary relief to Crowley‘s business operations and professional reputation is arguably just as considerable as the value of relief from the stigma or “shame associated with failing to receive an honorable discharge” from the military that we found sufficient to take a complaint outside the Claims Court‘s exclusive jurisdiction under the Tucker Act. Kidwell, 56 F.3d at 285 (military veteran, who did not explicitly seek monetary relief, brought APA action challenging Army Board for Correction of Military Records’ refusal “to change his military files to indicate a ‘medical’ discharge rather than [a] general discharge” (id. at 281)). Indeed, continuing to operate under the cloud of the GSA‘s audits and NOCs—and the resulting performance difficulties it creates—could conceivably jeopardize Crowley‘s ongoing contractual relationship with TRANSCOM, which runs through July 31, 2024, or its potential to win future contracts with other parties.
Moreover, “any monetary benefits that might flow if [Crowley] prevails on [its] non-monetary claims will not come from the District Court‘s exercise of jurisdiction.” Tootle, 446 F.3d at 175. Again, Crowley does not ask the district court to issue an order compelling the GSA to pay or award any monetary relief whatsoever. Cf. Spectrum, 764 F.2d at 894 (plaintiff sought “order compelling thе government to pay money owed in exchange for goods procured under an executory contract“). “[A]ny monetary recovery [Crowley] might be entitled to in the future,” including in Claims Court, “would be entirely separate from” the district court‘s exercise of jurisdiction and award of the requested declaratory and injunctive relief. Tootle, 446 F.3d at 175; Vietnam Veterans, 843 F.2d at 534 (“claim is not for money merely because its success may lead to pecuniary costs for the
The district court correctly concluded that this second Megapulse inquiry is controlled by Kidwell, Crowley, 2021 WL 4940953, at *8, but it incorrectly applied the test we articulated there, see id. at *9. First, it labeled Crowley‘s purported expense in investigating аnd challenging the NOCs, which amounted to an estimated $180,000 that “cannot be recovered,” as the “primary harm” redressable by a ruling in Crowley‘s favor. Id.; see Compl. ¶¶ 81-82, reprinted in J.A. 16. Although the district court acknowledged that this expense “would not be compensated by any money damage award either here [in district court] or at the [Claims Court],” it nevertheless compared that figure—and only that figure—to the $37 million allegedly withheld by the GSA to conclude that the former is “negligible in comparison” to the latter and therefore “in essence” a claim for monetary relief. Crowley, 2021 WL 4940953, at *9 (emphasis added). In doing so, it neglected to weigh the fact that Crowley‘s complaint did not request retroactive relief for the monetary value of the time and effort spent challenging the NOCs but did, as explained above and as made clear in its Prayer for Relief, seek prospective relief from the GSA‘s audits and NOCs in the future. The district court reached its conclusion merely by calculating the ratio of the value of the NOC withholdings ($37 million) to the asserted value of the personnel time attempting to review and challenge the NOCs ($180,000)—200 to 1.9 But there is no support for this method of comparison in our case law. The district court cited none, id., and the GSA points to none, see Appellees’ Br. 18-19.10
It also erred by characterizing the $37 million as “the real amount at stake here.” Crowley, 2021 WL 4940953, at *9. The district court found it “difficult to see how the requested” declaratory and injunctive relief “would not effect the release of the offsets assessed by GSA to date.” Id. But that “is not the law of the circuit.” Tootle, 446 F.3d at 176. We have explicitly rejected a district court‘s conclusion that a complaint sought “in essence” monetary relief because “the plain effect of a judgment in plaintiff‘s favor would be a significant financial gain for plaintiff.” Id. at 175-76 (citing district court opinion). Indeed, as we said in Kidwell, “[a] plaintiff does not ‘in essence’ seek monetary relief . . . merely because he or she hints at some interest in a monetary reward from the federal government or because success on the merits may obligate the United States to pay the complainant.” 56 F.3d at 284.
Crowley does not seek money in its suit against the GSA and the distriсt court would not award such relief were Crowley to prevail. The declaratory and injunctive relief sought has considerable value apart from and is not negligible in comparison to any potential monetary recovery Crowley may secure in Claims Court. Therefore, under Kidwell, Crowley‘s complaint does not request “in essence” monetary relief.
Crowley “has gone to great lengths to demonstrate that it is not relying on the contract at all. It does not claim a breach of contract, it has limited its request for relief” in district court to the enforcement of the GSA‘s statutory obligations, “it seeks no monetary damages against the United States, and its claim is not properly characterized as one for specific performance.” Megapulse, 672 F.2d at 969 (footnotes omitted). In other words, neither the source of the right on which Crowley‘s claim is based nor the type of relief sought sounds in contract. Id. at 968. We conclude that Crowley “has not brought a contract action or an otherwise disguised claim for monetary relief against the United States.” Id. at 971.
Under our precedent, the Court of Federal Claims has exclusive jurisdiction of an action pursuant to the Tucker Act only if the claim in question is “at its essence” contractual. A plaintiff satisfies this test if its asserted right is based in contract and seeks “in essence” more than $10,000 in monetary relief from the federal government. Here, neither of those conditions is met. Accordingly, jurisdiction of Crowley‘s action is proper in district court under the APA and the general federal question statute.11 Wе therefore reverse the district court‘s dismissal for lack of subject matter jurisdiction and remand for consideration of the merits of Crowley‘s claim.12
So ordered.