United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued February 6, 2006 Decided March 3, 2006
No. 04-5449
ROSEMARY LOVE, ET AL.,
APPELLANTS
v.
MICHAEL JOHANNS, SECRETARY, U.S. DEPARTMENT OF
AGRICULTURE
APPELLEE
Consolidated with
05-5084
Appeals from the United States District Court
for the District of Columbia
(No. 00cv02502)
Marc L. Fleischaker argued the cause for appellants. With
him on the briefs were Barbara S. Wahl and Kristine J. Dunne.
Pamela Coukos and Michael Foreman were on the brief of
amici curiae The Impact Fund, et al. in support of appellants.
Steven A. Skalet entered an appearance.
2
Dina R. Lassow and Paul M. Smith were on the brief of
amici curiae National Women’s Law Center and National
Partnership for Women & Families in support of appellants.
Charles W. Scarborough, Attorney, U.S. Department of
Justice, argued the cause for appellee. With him on the brief
were Peter D. Keisler, Assistant Attorney General, Kenneth L.
Wainstein, U.S. Attorney, and Robert M. Loeb, Attorney.
Shay Dvoretzky argued the cause for amicus curiae
Chamber of Commerce of the United States of America in
support of appellee. With him on the brief were Glen D. Nager,
Jason J. Jarvis, and Robin S. Conrad.
Before: SENTELLE and HENDERSON, Circuit Judges, and
EDWARDS, Senior Circuit Judge.
Opinion for the Court filed by Circuit Judge SENTELLE.
SENTELLE, Circuit Judge: Rosemary Love and nine other
female farmers appeal from the denial of their motion for class
certification. Appellants claim, on behalf of themselves and
“not less than 3,000” similarly situated women, that the United
States Department of Agriculture (“USDA” or “the
Department”) discriminatorily administered its lending
programs, and that the Department failed to process and
properly investigate women’s discrimination complaints over
the last quarter-century. Because we conclude the District Court
did not abuse its discretion in denying the Appellants’ motion
for class certification and did not err in dismissing the failure-to-
investigate claim, we affirm in part. However, because the
Appellants’ claim under the Administrative Procedure Act, 5
U.S.C. § 706(2)(A) (“APA”), remains largely unbriefed, we
remand in part.
3
I. INTRODUCTION
The Appellants allege the USDA has engaged in a
nationwide “pattern or practice” of discrimination, dating back
to 1981.1 Specifically, the Appellants’ first claim—hereinafter
the “discrimination claim”—is that the Department violated the
Equal Credit Opportunity Act, 15 U.S.C. §§ 1691-1691f
(“ECOA” or “the Act”) by employing subjective loan-making
criteria, which enabled decentralized decision-makers to
discriminate amongst loan applicants on the basis of gender.
The Appellants’ second claim—hereinafter the “failure-to-
investigate claim”—is that the Department violated both ECOA
and the APA by systematically dismantling its complaint-
processing systems and failing to investigate discrimination
claims filed by women farmers.
A
The USDA administers its farm loan and subsidy programs
through the Farm Service Agency (“FSA”).2 The FSA makes
several different types of loans, including “farm ownership”
loans, which assist farmers in buying or improving farm
1
ECOA claims are generally governed by a two-year statute
of limitations. See 15 U.S.C. § 1691e(f). However, in light of Pigford
v. Glickman, 182 F.R.D. 341 (D.D.C. 1998), Congress retroactively
extended the limitations period for certain claims, including those
raised by the Appellants. See Agriculture, Rural Development, Food
and Drug Administration, and Related Agencies Appropriations Act
of 1999, Pub. L. No. 105-277, 112 Stat. 2681 (codified at 7 U.S.C. §
2279 note).
2
Prior to January 1, 2000, the FSA was named the Farmers
Home Administration. See 60 Fed. Reg. 23030, 23035 (1995).
Throughout this opinion, we use “FSA” to refer to both entities.
4
property, 7 C.F.R. pt. 1943, “operating” loans, which provide
credit and management assistance to help farmers run their
farms, id. pt. 1941, and “emergency” loans, which help farmers
resume operations after a disaster, id. pt. 1945. Under the
USDA’s regulations, a farmer seeking a farm credit or benefit
must first ask the Department for a loan application, which the
USDA is required to disburse. See id. § 1910.4(b) (“All persons
requesting an application will be provided [one].”).
After receiving an application, a farmer is then required to
submit her completed application to a local county committee,
the members of which are selected by other farmers from that
county. See Pigford v. Glickman, 206 F.3d 1212, 1214 (D.C.
Cir. 2000). The local county committee initially determines
whether the applicant is eligible for the program, and USDA
staff members ultimately grant or deny the application. See 7
C.F.R. §§ 1910.5, 1910.4(i). The USDA has promulgated
criteria upon which the local committees are to rely in making
eligibility decisions, including citizenship, legal capacity,
education and farming experience, farm size, inability to obtain
sufficient credit elsewhere, and “character” (which emphasizes
credit history and reliability). See id. §§ 1941.12 (operating loan
criteria), 1943.12(a) (ownership loan criteria), 764.4 (emergency
loan criteria).
Any farmer who believes the USDA denied her application
for a program loan or benefit on the basis of gender or any other
prohibited basis may file a civil rights complaint with the
Secretary of the USDA and/or the USDA’s Office of Civil
Rights (“OCR”). See id. § 15.6. The Department and/or OCR
may then conduct an investigation and institute compliance
proceedings, if needed. See id. §§ 15.8-.10. To effectuate
compliance, the Secretary may refer the matter to the
Department of Justice or institute any other applicable
proceedings under state or local law. Id. § 15.8(a).
5
If a farmer is dissatisfied with the USDA’s response to her
discrimination complaint, she may sue in federal court under
ECOA. The Act makes it “unlawful for any creditor to
discriminate against any applicant with respect to any aspect of
a credit transaction . . . on the basis of race, color, religion,
national origin, sex or marital status, or age.” 15 U.S.C. §
1691(a). ECOA creates a private right of action against
creditors, including the United States, who violate its anti-
discrimination provisions, and it makes such creditors “liable to
the aggrieved applicant for any actual damages sustained by
such applicant acting either in an individual capacity or as a
member of a class.” Id. § 1691e(a). Exhaustion of
administrative remedies is not required before an ECOA suit
may be filed, and prevailing Appellants may recover attorney’s
fees. Id. § 1691e(d).
B
The Appellants filed a three-count complaint in the United
States District Court for the District of Columbia, seeking $3
billion in money damages under ECOA, as well as both
compensatory and equitable relief under the APA and the
Declaratory Judgment Act, 28 U.S.C. § 2201(a). To buttress
their claims, the Appellants filed 1,823 declarations, which
purported to show that the Department “allowed, indeed
supported, unconscionable disparate impact [through USDA’s
lending programs] around the country.” The Appellants’
statistics expert, Patrick M. O’Brien, also filed a report, which
purported to provide empirical evidence of “the adverse affects
[sic] of a discriminatory system.” The Department moved to
dismiss the complaint under FED. R. CIV. P. 12(b)(6), and the
Appellants moved for class certification under FED. R. CIV. P.
23.
6
Before ruling on the propriety of class certification, the
District Court dismissed the Appellants’ failure-to-investigate
claim on three grounds. First, the District Court concluded that
the USDA’s failure to investigate the Appellants’ complaints did
not constitute a “credit transaction” within the meaning of
ECOA, 15 U.S.C. § 1691(a). Second, the court held the APA’s
“abuse of discretion” standard does not cover the USDA’s
failure to investigate Appellants’ complaints because ECOA
provided an alternative “adequate remedy.” Third, the District
Court concluded Appellants’ claims for money damages arising
from the USDA’s failure to investigate their complaints are
barred by the doctrine of sovereign immunity.
In light of the court’s dismissal of the failure-to-
investigate claim, the Appellants based their motion for class
certification solely upon their discrimination claim.
Accordingly, the Appellants filed an amended complaint, along
with a renewed motion for certification of two subclasses.
“Subclass 1” consists of female farmers who asked for loan
application forms but did not receive them. “Subclass 2”
consists of female farmers who received, completed, and
submitted their loan application forms but did not garner a loan.
The amended complaint also dropped the Appellants’ demand
for $3 billion in damages and asked only for “compensatory
damages appropriate for proof at trial.”
The District Court denied the Appellants’ renewed
motion to certify the class on three grounds. First, the court
concluded that the Appellants failed to satisfy Rule 23(a)’s
commonality requirement because there had not “been a
substantial showing that would permit the inference that
members of the class suffered from a common policy of
discrimination that pervaded all of the challenged decisions.”
Second, the court concluded that the class could not be certified
under Rule 23(b)(2) because the claims for monetary relief
7
predominated over the claims for equitable relief. Third, the
court concluded the class could not be certified under Rule
23(b)(3) for the same reason it did not satisfy Rule 23(a)’s
commonality requirement: The Appellants “adduced no
evidence . . . establishing that it is or ever was actually USDA
policy to refuse to give loan application forms to women,” and
individual justifications for any loan denials would predominate
over questions common to the putative class.
The District Court stayed the proceedings so that the
Appellants could seek interlocutory review of the denial of class
certification on their discrimination claim, as well as the
dismissal of their failure-to-investigate claim. In our discretion,
we granted the Appellants’ petitions for interlocutory review of
the class certification denial. We have jurisdiction over the
District Court’s dismissal of their failure-to-investigate claim
under 28 U.S.C. § 1292(b). See FED. R. CIV. P. 23(f); In re
Lorazepam & Clorazepate Antitrust Litig., 289 F.3d 98, 105-06
(D.C. Cir. 2002). The parties (with the help of three amici
curiae) then fully briefed and argued both issues before a merits
panel. Compare In re Veneman, 309 F.3d 789, 791 (D.C. Cir.
2002) (denying a 23(f) petition “because the critical questions
required to resolve it are entirely unbriefed”).
II. DISCRIMINATION CLAIM
Appellants’ first assignment of error is that the District
Court erroneously declined to certify their putative class as to
the “discrimination claim.” To justify class certification,
Appellants must first satisfy four threshold requirements,
demonstrating that:
(1) the class is so numerous that joinder of all members is
impracticable, (2) there are questions of law or fact
common to the class, (3) the claims or defenses of the
8
representative parties are typical of the claims or defenses
of the class, and (4) the representative parties will fairly and
adequately protect the interests of the class.
FED. R. CIV. P. 23(a). If all four prerequisites under Rule 23(a)
are met, then Appellants must also show that their claims fit
within one of the subsections of Rule 23(b). See Amchem
Prods., Inc. v. Windsor, 521 U.S. 591, 613-16 (1997). Rules
23(b)(2) and (b)(3)—the two subsections at issue in this
case—have different requirements depending primarily on the
nature of the relief sought: Certification under the former is
appropriate where a class seeks declaratory or injunctive relief,
while certification under the latter is appropriate where, inter
alia, the “‘final relief relates exclusively or predominantly to
money damages.’” In re Veneman, 309 F.3d at 792 (quoting
FED. R. CIV. P. 23(b)(2) advisory committee notes).
The District Court declined to certify the class because the
Appellants failed to show “commonality” under Rule 23(a)(2),
and they failed to meet the requirements of Rule 23(b)(2) or
23(b)(3). Because we conclude the District Court neither erred
as a matter of law nor abused its discretion in finding the
putative class members lack “commonality” under Rule
23(a)(2), we affirm without considering whether certification
would also be improper under Rule 23(b).
A
Appellants argue that the District Court erred by failing to
find commonality within Subclass 1 under Rule 23(a)(2). We
review the District Court’s decision for abuse of discretion. See
Hartman v. Duffey, 19 F.3d 1459, 1471 (D.C. Cir. 1994);
Wagner v. Taylor, 836 F.2d 578, 586 (D.C. Cir. 1987).
Each member of Subclass 1 allegedly requested an
application for a farm loan and had her request denied.
9
Although the District Court recognized that “[p]laintiffs have
assembled an impressive collection of sworn statements
asserting that a great many women have been flatly refused . . .
loan application forms,” it nonetheless declined to certify
Subclass 1. The court noted that the Appellants’ declarations
“might have been sufficient to support certification of subclasses
of women who suffered discrimination at the hands of particular
county committees,” but variations between the declarations
precluded a finding of “commonality” for purposes of a
nationwide class action.
The Appellants concede that the Department offered
varying reasons for denying their requests, but Appellants argue
these variations are irrelevant “because there is no basis for
refusing to distribute loan applications to requestors, pursuant to
USDA’s own regulations.” See 7 C.F.R. § 1910.4(b) (“All
persons requesting an application will be provided [one].”).
Appellants further concede that they have no statistical proof
that women’s requests for loan applications were treated
differently from men’s. Nevertheless, Appellants assert that a
mountain of anecdotes proves that their claims are “not mere
coincidence.” In the absence of any data to the contrary, the
Appellants claim, the District Court should have presumed that
622 aggrieved women’s declarations warranted the certification
of the class.
We disagree. As we have previously noted:
[T]here is more to a showing of commonality than a
demonstration that class plaintiffs suffered discrimination
on the basis of membership in a particular group. . . . While
in a case alleging intentional discrimination, such as this
one, a plaintiff need not isolate the particular practice and
prove that such practice caused the discrimination,
plaintiffs must make a significant showing to permit the
court to infer that members of the class suffered from a
10
common policy of discrimination that pervaded all of the
employer’s challenged employment decisions.
Hartman, 19 F.3d at 1472 (emphasis in original). Thus,
commonality under Rule 23(a) requires a named plaintiff to
show (i) discrimination (ii) against a particular group (iii) of
which the plaintiff is a member, plus (iv) some additional factor
that “permit[s] the court to infer that members of the class
suffered from a common policy of discrimination.” Id.
Hartman’s “common policy” requirement is consistent with the
Supreme Court’s teaching in General Telephone Co. of the
Southwest v. Falcon, 457 U.S. 147 (1982). There the Court
noted:
Conceptually, there is a wide gap between (a) an
individual’s claim that he has been [discriminated against],
and his otherwise unsupported allegation that the company
has a policy of discrimination, and (b) the existence of a
class of persons who have suffered the same injury as that
individual, such that the individual’s claim and the class
claims will share common questions of law or fact . . . . For
respondent to bridge that gap, he must prove much more
than the validity of his own claim.
Id. at 157-58.
The District Court did not abuse its discretion in concluding
that Appellants failed to “bridge th[e] gap” between their
individual claims and Hartman’s “common policy” requirement.
Some members of Subclass 1 (namely, the 622 declarants)
offered anecdotal evidence that they were personally denied loan
applications, and some of those same women reported
discriminatory treatment by USDA officials. For example, the
declarants allege that USDA officials told them “they were too
early to apply for a loan, too late to apply for a loan, that they
need not bother filling out an application because they were not
11
eligible to receive a loan, or that their husbands should apply.”
Appellants’ Br. at 11. Certainly these allegations may give the
declarants standing to bring individual suits. However, the
declarants’ allegations did not require the District Court to infer
the existence of a “common policy of discrimination” that
affected the non-declarants, as well. The bald allegation that the
declarants and non-declarants alike are unified by a “common
policy” of gender discrimination is insufficient to show the
District Court abused its discretion under Hartman and Falcon.
As the Appellants candidly admit, there is no evidence that
women were more likely than men to be refused loan
applications. See Appellants’ Br. at 13. Moreover, the
declarants’ anecdotal accounts differ widely, and their
complaints of discrimination are interspersed with
nondiscriminatory evidence and innocuous explanations.
Compare Joint Appendix (“J.A.”) 538 (“I was told there were no
f[u]nds available.”), and J.A. 540 (“I was told that there were no
funds or applications available.”), with J.A. 536 (A USDA
official “told me that farming business was too risky for
women.”). Thus, even taking as true all of the declarants’
factual allegations, the District Court was nevertheless left to
wonder whether some of the declarants (to say nothing of the
silent, non-declarants) were victimized by gender
discrimination. Because the Appellants failed to “bridge th[e]
gap” between their individual and class-wide claims, we cannot
fault the District Court for refusing to take a leap of faith.
A recent case from the Sixth Circuit illustrates our point. In
Reeb v. Ohio Dep’t of Rehab. & Corr., — F.3d —, 2006 WL
162836 (6th Cir. Jan. 24, 2006), four female prison guards filed
a putative class action against their employer, alleging it
violated Title VII by treating them differently from the male
guards. Seeking to represent all past and present female
employees at the prison, the named plaintiffs claimed to have
12
been the victim of the defendant’s “general policy” of
discrimination on the basis of sex. The district court certified
the class and found Rule 23(a)’s commonality requirement met
“[b]ecause the issue of whether the Defendant violated Title VII
will be common to the class.” Id. at *5 (internal quotation
marks and citation omitted). The appeals court reversed for an
abuse of discretion because “[i]f this were the test, every
plaintiff seeking to certify a class in a Title VII action would be
entitled to that certification.” Id.; see also Bacon v. Honda of
Am. Mfg., Inc., 370 F.3d 565, 571 (6th Cir. 2004) (“Conclusory
allegations and general assertions of discrimination are not
sufficient to establish commonality.” (citing Falcon, 457 U.S. at
157)); Sprague v. Gen. Motors Corp., 133 F.3d 388, 397 (6th
Cir. 1998) (“It is not every common question that will suffice [to
show commonality], however; at a sufficiently abstract level of
generalization, almost any set of claims can be said to display
commonality. What we are looking for is a common issue the
resolution of which will advance the litigation.”).
After conducting a “rigorous analysis” of the Appellants’
claims under Rule 23(a), Hartman, 19 F.3d at 1473, the District
Court in this case exercised its considered judgment and
concluded that class certification would not advance the
litigation. Cf. Pigford v. Glickman, 185 F.R.D. 82 (D.D.C.
1999) (chronicling the arduous process of handling a similar
case as a class action). Even if Subclass 1 were certified, the
District Court concluded, the outcome of this case would
nevertheless turn on a series of individualized inquiries into
application-distribution practices in more than 2,700 FSA
offices across the country over the last quarter-century. Unlike
the Reeb court, we need not consider whether the contrary
conclusion would have constituted an abuse of discretion. For
present purposes, it is sufficient to note that while it might not
be reversible error to certify a subclass under these or similar
circumstances, see Chiang v. Veneman, 385 F.3d 256, 265-66
13
(3d Cir. 2004) (affirming the certification of a class akin to
Subclass 1), it is also not an abuse of discretion for the District
Court to refuse to do so, see Eubanks v. Billington, 110 F.3d 87,
96 (D.C. Cir. 1997).
We hasten to emphasize that we do not hold that anecdotal
evidence alone is inherently insufficient to justify class
certification. In this case, however, the District Court did not
abuse its discretion by refusing to certify Subclass 1 for lack of
commonality under Rule 23(a)(2) on the diverse affidavits
before it, and the large number of silent, potential class
plaintiffs. As a result, we have no occasion to consider the
District Court’s alternative holdings under Rule 23(b).3 See
Amchem, 521 U.S. at 613-14.
B
Appellants mount a two-prong challenge to the District
Court’s analysis of Subclass 2, which comprises women
applicants who were allegedly denied farm loans on the basis of
their gender. The District Court concluded that the geographic
dispersal and decentralized organization of the USDA’s loan
offices “cut[] against any inference for class action
commonality.” Moreover, the court noted that the Department
offered a wide array of objective, highly individualized
justifications (such as the “failure to meet collateral
requirements, poor credit, [and] insufficient income”) for
denying the Appellants’ loan requests. Appellants first claim the
District Court erred as a matter of law. Second, Appellants
claim the District Court abused its discretion by ignoring the
facts. We address (and reject) each claim in turn.
3
Even were we to consider Rule 23(b), the similar lack of
“generally applicable grounds” under (b)(2) and “predominance”
under (b)(3) would doom the certification. See pp. 7-8, supra.
14
1
Appellants argue that the District Court erred as a matter of
law in its evaluation of commonality within Subclass 2. In
Appellants’ view, “[t]he District Court created its own entirely
new standard for determining how subjective a system must be
in order to demonstrate a common policy of discrimination.”
Appellants argue that Subclass 2 is unified by the USDA’s
policy of delegating standardless discretion to local loan-making
officers, and “[t]his Court” has held that “a common policy [of
discrimination] exist[s] when significantly subjective decision-
making operates on a national basis with discriminatory results.”
Accordingly, Appellants criticize “the District Court’s
substitution” of its own legal standard—which Appellants dub
a “subjectivity spectrum”—“in lieu of well-established
precedent.” Our review of the question of law is de novo. See,
e.g., Gov’t of Rwanda v. Johnson, 409 F.3d 368, 372 (D.C. Cir.
2005).
Appellants are wrong about the law of “[t]his Court.” We
have never held that subjective decision-making processes
require a district court to find commonality for purposes of class
certification. See, e.g., Hartman, 19 F.3d 1472 (holding
plaintiffs’ challenge to the defendant’s “subjective” decision-
making did not warrant a finding of commonality: “While
plaintiffs’ statistics may have demonstrated that discrimination
against women applicants to the six [] job categories was afoot,
nothing in the record so far permits the additional inference that
class members suffered a common injury.” (emphasis in
original)); see also Wagner, 836 F.2d at 594-95. The District
Court’s application of Hartman was not erroneous as a matter of
law.
15
2
Appellants next argue that the District Court abused its
discretion by failing to properly consider evidence of
commonality within Subclass 2. Appellants rely on 859
declarations from disappointed female loan applicants, who
“attested that they were denied loans based upon their gender.”
However, by the Appellants’ own count, 41% of these declarants
have no idea why their loan applications were denied. See
Appellants’ Br. at 21 (asserting that 27% received “no official
written response” to their loan applications, while an additional
14% received “the equivalent of no response”). The District
Court was well within the bounds of its discretion to find a lack
of commonality where two out of every five of the Appellants’
own declarants—to say nothing of the silent non-
declarants—would be forced to prove at trial that individual
reasons for their loan denials were not pretextual (e.g., one
woman had poor credit, another had no collateral, a third was
victimized by gender discrimination, etc.). For the same reasons
that justified the District Court’s conclusion that Subclass 1 does
not exhibit “commonality,” the record in this case does not
compel the conclusion that the USDA discriminated against
women across the class, even if some individual declarants in
Subclass 2 properly stated a discrimination claim. See Hartman,
19 F.3d at 1472.
Appellants’ efforts to demonstrate commonality through
rudimentary statistics are equally unavailing. Appellants’
statistics expert, Patrick O’Brien, admits that his analysis does
not account for the possibility that women receive fewer loans
because they apply for fewer loans, and he recognizes that
women may receive smaller loans because they operate smaller
farms. Moreover, there are countless other, non-discriminatory
explanations for any patterns in the USDA’s lending data. For
example, women may have relatively less credit than men;
16
women may have relatively less wealth than men; or women
may apply for loans at a younger—and thus riskier—age than
men. Instead of conducting a relatively simple statistical
analysis (such as a multiple regression) to control for any or all
of these variables, O’Brien simply reported a series of
elementary cross-tabulations, from which it is impossible—as a
statistical matter—to draw meaningful conclusions. See, e.g.,
WILLIAM H. GREENE, ECONOMETRIC ANALYSIS 100-01, 147-60
(4th ed. 2000); Frank T. Denton, The Significance of
Significance: Rhetorical Aspects of Statistical Hypothesis
Testing in Economics, in THE CONSEQUENCES OF ECONOMIC
RHETORIC 163 (Arjo Klamer, Donald N. McCloskey & Robert
M. Solow eds., 1988). The Appellants’ expert concedes that
“[n]o statistical tests for significance were done” on his data.
Compare Bazemore v. Friday, 478 U.S. 385, 399 n.9 (1986)
(holding the Appellants’ empirical evidence of discrimination
was admissible to show disparate treatment because it showed
“statistically significant” disparities).
Given the numerous shortcomings in the Appellants’ efforts
to show commonality within Subclass 2, the District Court did
not abuse its discretion in denying the Appellants’ certification
motion under Rule 23(a)(2). Accordingly, we have no occasion
to consider the District Court’s alternative holdings under Rule
23(b). See Amchem, 521 U.S. at 613-14.
III. FAILURE-TO-INVESTIGATE CLAIM
Appellants’ final argument is that the District Court erred
in dismissing their “failure-to-investigate” claim prior to ruling
on their motion for class certification. The District Court
concluded the USDA’s alleged failure to investigate Appellants’
complaints is not reviewable under ECOA, which makes it
“unlawful for any creditor to discriminate against any applicant
with respect to any aspect of a credit transaction” on the basis
17
of sex. 15 U.S.C. § 1691(a) (emphasis added). The court
concluded, as a matter “of course,” that a failure to investigate
does not fit within the plain meaning of a “credit transaction.”
The District Court further concluded that Appellants’ failure-to-
investigate claim is not reviewable under the APA because
ECOA provides an adequate alternative remedy. See 5 U.S.C.
§ 704 (limiting the applicability of the APA to a “final agency
action for which there is no other adequate remedy in a court”).
Appellants argue the District Court erred under both ECOA
and the APA. First, the Appellants urge us to construe liberally
the meaning of a “credit transaction” under 15 U.S.C. § 1691(a)
and to hold their failure-to-investigate claim is reviewable under
ECOA. Alternatively, the Appellants argue their claim is
reviewable under the APA because the USDA’s regulations
empower aggrieved applicants to file discrimination claims,
which the Department is legally obligated to investigate. Our
review is de novo. See, e.g., Johnson, 409 F.3d at 372.
We first reject the Appellants’ argument under ECOA
because even a liberal interpretation of “credit transaction” does
not encompass “failure to investigate a discrimination
complaint.” Cf. Bissette v. Colonial Mortgage Corp. of D.C.,
477 F.2d 1245, 1247 (D.C. Cir. 1973) (noting “‘liberal
construction’ and interpretation based on legislative purpose can
only go so far. Where the meaning of the statute and regulations
is clear, a contrary reading would become destruction of the
statutory scheme.”). True, the phrase “credit transaction” is not
without ambiguity, but it is not a normal understanding of those
words in the English language that they would include the
failure to investigate complaints of discrimination in an
underlying event even if the underlying event falls within the
meaning of the phrase “credit transaction.”
18
Again, there is a certain ambiguity in the term. The
Department has gone to the trouble of issuing a defining
regulation. See 12 C.F.R. § 202.2(m). The regulatory scheme
of which that is a part may become the stuff of APA litigation
upon remand, but so far as an action at law based on this section
of the ECOA, that simply is not within the plain meaning of the
statute.
This leaves the Appellants’ claim that the USDA’s failures
to investigate discrimination claims are reviewable under the
APA for another day. We follow this course of nonaction
because the record is little developed on that argument, and the
parties’ briefs have given short-shrift to the issue before us. As
our review of this claim is discretionary in the first place, and as
the order certifying the 12(b)(6) ruling for interlocutory review
was without prejudice to further decision by the merits panel of
this court, we decline to exercise our discretion and remand the
APA claim for further proceedings in the District Court. See In
re Veneman, 309 F.3d at 796.
CONCLUSION
For the reasons stated above, the District Court’s denial of
the Appellants’ motion for class certification is affirmed. The
District Court’s dismissal of the Appellants’ failure-to-
investigate claim under ECOA is affirmed, but its dismissal of
the Appellants’ failure-to-investigate claim under the APA is
remanded.
So ordered.