Rothe Development Corp. v. Department of Defense

413 F.3d 1327, 2005 U.S. App. LEXIS 12748, 2005 WL 1514229
CourtCourt of Appeals for the Federal Circuit
DecidedJune 28, 2005
Docket2004-1552
StatusPublished
Cited by107 cases

This text of 413 F.3d 1327 (Rothe Development Corp. v. Department of Defense) is published on Counsel Stack Legal Research, covering Court of Appeals for the Federal Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Rothe Development Corp. v. Department of Defense, 413 F.3d 1327, 2005 U.S. App. LEXIS 12748, 2005 WL 1514229 (Fed. Cir. 2005).

Opinion

MICHEL, Chief Judge.

Rothe Development Corporation (“Rothe”) appeals from the judgment of the United States District Court for the Western District of Texas. The primary issue in this appeal is the district court’s grant of summary judgment to the United States Department of Defense and the United States Department of the Air Force (collectively, the “government”) on Rothe’s claim of facial unconstitutionality as to the presently applicable, 2002 reau-thorization of section 1207 of the National Defense Authorization Act of 1987, Pub.L. No. 99-661, 100 Stat. 3859, 3973 (1986), codified at 10 U.S.C. § 2323, as amended by the Bob Stump National Defense Authorization Act for Fiscal Year 2003, Pub.L. No. 107-314, § 816, 116 Stat. 2458, 2610 (2002). See Rothe Dev. Corp. v. United States Dep’t of Def., 324 F.Supp.2d 840 (W.D.Tex.2004) (“Rothe IV”). The government urges that we lack jurisdiction over this constitutional issue because it is unripe for adjudication and for other reasons. Also at issue are the district court’s holdings that Rothe’s damages and equitable-award-of-a-contract claims are moot, as well as the district court’s denial of Rothe’s motion for attorney fees related to other claims on which Rothe prevailed.

This case was submitted for decision after oral argument on March 7, 2005. We hold that we do have jurisdiction to consider the facial constitutionality of the present reauthorization of section 1207 but that the record is inadequate to decide the issue because the district court declined to provide the necessary opportunity to expand the record despite explicit remand instructions. We, therefore, have no option but, once again, to vacate and remand to the district court for necessary development of the evidentiary record. We further hold that Rothe’s damages claim is not moot but its equitable award of a contract claim is moot. Finally, we hold that because Rothe did not preserve for appeal its contention that the district court erred in denying its request for attorney fees, the denial stands.

I

We have considered this case in a prior appeal. Rothe Dev. Corp. v. United States *1330 Dep’t of Def., 262 F.3d 1306 (Fed.Cir.2001) (“Rothe III”); see also Rothe Dev. Corp. v. United States Dep’t of Def., 194 F.3d 622 (5th Cir.1999) (“Rothe II”) (transferring the case to this court); Rothe Dev. Corp. v. United States Dep’t of Def., 49 F.Supp.2d 937 (W.D.Tex.1999) (“Rothe I ”).

Because we extensively discussed the factual and legal background of this case in Rothe III, we need not repeat the details here. See Rothe III, 262 F.3d at 1313-16. In short, Rothe alleges that it was denied equal protection under the Fifth Amendment’s Due Process Clause by the.enactment and application of section 1207, which provides certain benefits to businesses controlled by socially and economically disadvantaged individuals (“SDBs”). Section 1207 sets a goal that five percent of the total dollar amount of defense contracts per year be awarded to SDBs. Regulations enacted pursuant to section 1207 provide mechanisms for achieving that goal. The mechanism most important in this case is the price-evaluation adjustment, which authorized a contracting agency of the Department of Defense to raise the bid of non-SDB bidders by as much as ten percent.

Section 1207 was originally enacted for a three-year time period to end in 1990. Prior to the most recent reauthorization, section 1207 was reauthorized in 1989 for the period from 1990 to 1993, in 1992 for the period from 1993 to 2000, and in 1999 for the period from 2000 to 2003. See Rothe III, 262 F.3d at 1313-14 (collecting citations to prior reauthorizations). Most recently, in December 2002, section 1207 was reauthorized through September 2006. Bob Stump National Defense Authorization Act for Fiscal Year 2003, Pub.L. No. 107-314, § 816, 116 Stat. 2458, 2610 (2002).

Rothe alleges that it was harmed by the application of section 1207 to the bidding process for a contract for computer-related services with an Oklahoma Air Force base in 1998. Although Rothe submitted the lowest bid, it lost the contract to International Computer and Telecommunications, Inc. (“ICT”) when Rothe’s bid was increased by ten percent because ICT qualified as an SDB and Rothe did not. Rothe brought suit in federal district court alleging, inter alia, that section 1207 is unconstitutional as enacted and applied. The district court granted summary judgment in favor of .the government. Rothe I, 49 F.Supp.2d at 953-54.

In Rothe III, we reversed the district court’s judgment, holding that the district court did not properly apply strict scrutiny in analyzing the constitutionality of section 1207 and that it erred in relying on evidence that post-dated the various reau-thorizations of section 1207 under consideration. 262 F.3d at 1332. On remand, the district court held that Rothe’s claim to damages and to an equitable award of the 1998 contract were moot. On the merits, the district court held that the reauthorizar tion of section 1207 in 1992 was facially unconstitutional but the present, i.e., 2002, reauthorization was not. Rothe IV, 324 F.Supp.2d at 860. Because the government did not appeal the district court’s decision as to the invalidity of the 1992 reauthorization, only the present reauthor-ization is before us on appeal. The district court also denied Rothe’s request for attorney fees.

Rothe filed a timely notice of appeal from the final judgment of the district court and we have jurisdiction under 28 U.S.C. § 1295(a)(2).

II

Rothe has made claims for (A) damages, (B) an equitable award of the 1998 contract, and (C) a declaration that section 1207 is facially unconstitutional. The government argues that jurisdiction is lacking for each of these claims for one or more of *1331 the following reasons: the claim is moot, Rothe lacks standing to assert the claim, and the claim is unripe.

A

Considering first Rothe’s claim to damages, the district court held, and the government argues on appeal, that jurisdiction over Rothe’s damages claim is lacking on mootness grounds because the government has already tendered the maximum amount to which Rothe could be entitled. 1 In general, a claim must be dismissed as moot “when the issues presented are no longer live or the parties lack a legally cognizable interest in the outcome.” City of Erie v. Pap’s A.M., 529 U.S. 277, 287, 120 S.Ct. 1382, 146 L.Ed.2d 265 (2000) (internal quotation omitted).

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413 F.3d 1327, 2005 U.S. App. LEXIS 12748, 2005 WL 1514229, Counsel Stack Legal Research, https://law.counselstack.com/opinion/rothe-development-corp-v-department-of-defense-cafc-2005.