Vaughn v. United States Small Business Administration

65 F.3d 1322
CourtCourt of Appeals for the Sixth Circuit
DecidedSeptember 21, 1995
StatusPublished
Cited by4 cases

This text of 65 F.3d 1322 (Vaughn v. United States Small Business Administration) is published on Counsel Stack Legal Research, covering Court of Appeals for the Sixth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Vaughn v. United States Small Business Administration, 65 F.3d 1322 (6th Cir. 1995).

Opinions

ENGEL, J., delivered the opinion of the court, in which SUHRHEINRICH, J., joined. JONES, J. (pp. 1330-31), delivered a separate dissenting opinion.

ENGEL, Circuit Judge.

The question in this appeal is whether defendant-appellant John Whitmore, an official of the United States Small Business Administration (SBA), is entitled to qualified immunity in a suit arising out of the SBA’s denial of certain benefits to plaintiff Jerry Vaughn. Vaughn, a blind white male, brought this action for punitive damages in the district court, alleging that he was denied these benefits on account of his race and handicap, in violation of 29 U.S.C. § 794, 42 U.S.C. § 1981, 42 U.S.C. § 1985(3), and the Fifth Amendment of the Constitution. The district court below concluded that Whitmore was not entitled to qualified immunity from Vaughn’s suit. Because we conclude that Whitmore did not violate any of Vaughn’s clearly established rights, we REVERSE the district court’s refusal to grant Whitmore qualified immunity.

I. Background

Vaughn, a registered Tennessee contractor, applied in April, 1986, for federal assistance pursuant to the SBA’s 8(a) program. Under the 8(a) program, 15 U.S.C. § 637(a), contracts are awarded to “small business[es] owned and controlled by socially and economically disadvantaged individuals.” Persons who fall within certain designated ethnic or minority groups (Black Americans, Native Americans, etc.) are presumed disadvantaged. 13 C.F.R. § 124.105(b). Others, such as persons with disabilities, can be admitted if they prove social disadvantage by clear and convincing evidence. Id.

In July, 1987, the SBA denied Vaughn’s first application for admission to the 8(a) program on the ground that he was not “socially and economically disadvantaged.” A request for reconsideration was denied the following year. At this point, Vaughn complained to the SBA’s Office of Civil Rights Compliance (OCRC) that he was denied admission to the 8(a) program on account of his race and his handicap. A preliminary report drafted by OCRC found that the denial of Vaughn’s first application had been arbitrary and capricious and that Vaughn had been the victim of discrimination on account of both race and handicap. This preliminary report suggested that officials at the SBA were disinclined to grant 8(a) benefits to non-minority applicants. However, the finding of discrimination was rejected by the SBA Office of the General Counsel, and later qualified by the OCRC in its final report. The agency’s final disposition of the discrimination complaint ultimately concluded that Vaughn’s first application to the 8(a) program was processed in an arbitrary and capricious manner, but that no discrimination had occurred.

Vaughn reapplied to the 8(a) program in February, 1989, and was once again denied. This second application was denied for two reasons: (1) he had still not proved social and economic disadvantage by clear and convincing evidence; and (2) his contracting business did not exhibit the potential for success. According to the SBA’s “potential for success” test, 13 C.F.R. § 124.107, an applicant cannot participate in the 8(a) program unless the applicant’s contracting business has generated some revenue in the two years prior to application, which Vaughn’s business has not.

Vaughn’s request for reconsideration of this second agency action was denied in February, 1991, by defendant John Whitmore. The denial of Vaughn’s request for reconsideration of his second 8(a) application was Whitmore’s only involvement with Vaughn’s case, and therefore comprises the only basis [1325]*1325for asserting any claim of discrimination against Whitmore individually.

Contrary to the findings of previous evaluators, Whitmore concluded that Vaughn might in fact be “socially and economically disadvantaged,” as the 8(a) program requires. Nonetheless, Whitmore concluded that Vaughn was ineligible to participate in the 8(a) program, because Vaughn’s business had not generated any revenue in the two years prior to his second application, and therefore, Vaughn failed the potential for success test. Whitmore further concluded that there was no basis in Vaughn’s case to justify a waiver of the two year revenue rule, although such waiver is permitted under certain narrow circumstances.

On February 28,1992, Vaughn filed suit against the SBA and several individual defendants. In response to Whitmore’s motion to dismiss, or in the alternative, for summary judgment, the district court concluded that Whitmore was not entitled to qualified immunity, and Whitmore now appeals that ruling.1 “Since application of the doctrine of qualified immunity to a particular defendant is a question of law,” we “reviefw] de novo the district court’s disposition.” Mumford v. Zieba, 4 F.3d 429, 432 (6th Cir.1993).

II. The Dissent

The dissent would affirm the district court because, and presumably only because, Whitmore allegedly failed to present his argument to the lower court that Vaughn did not state his claims “in terms of facts rather than conclusions.” We respectfully disagree. In his motion in the district court, Whitmore alleged:

the plaintiff must show that the conduct of the individual government officers violated some clearly established statutory or constitutional rights of which they should have been aware_ Vaughn has not established that any of his statutory or constitutional rights were violated by any of the defendants.

App. 139-140. That Whitmore may not have used the phrase “facts rather than conclusions” or raised that specific form of the objection is not, in our view, dispositive. There are many different ways of expressing legal ideas, and it seems to us altogether apparent that Whitmore did indeed make the objection on which we reverse before the district court. The possibility that the district court misunderstood the argument does not render it an “issue not litigated in the trial court,” nor does it bar our review. In our judgment the issue was “fairly raised” below and the trial court given an opportunity to address it.

It would be unfortunate and unfaithful to the meaning of the law, in our view, to rule otherwise. To so hold would render unre-viewable any argument which was not completely articulated in the court below, leaving us to decide the issues, not as finally and most maturely expressed, but tightly confined to the form in which they were presented to the district court. Were this the rule, there would be little reason indeed to require fresh briefing and oral argument in this court. There is more substance than this in the appellate process. We admit we would not be justified in “running away with a case” on some new and previously unvisited theory, but we have not done so here.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Cite This Page — Counsel Stack

Bluebook (online)
65 F.3d 1322, Counsel Stack Legal Research, https://law.counselstack.com/opinion/vaughn-v-united-states-small-business-administration-ca6-1995.