United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued February 5, 2016 Decided April 5, 2016
No. 15-5113
ROBERT GORDON,
APPELLANT
v.
LORETTA E. LYNCH, IN HER OFFICIAL CAPACITY AS ATTORNEY
GENERAL OF THE UNITED STATES, ET AL.,
APPELLEES
Appeal from the United States District Court
for the District of Columbia
(No. 1:10-cv-01092)
Aaron M. Streett argued the cause for appellant. With
him on the briefs was Craig A. Schwartz. Vernon A. Cassin
III and Richard P. Sobiecki entered appearances.
William E. Havemann, Attorney, U.S. Department of
Justice, argued the cause for appellees. With him on the brief
were Benjamin C. Mizer, Principal Deputy Assistant Attorney
General, Vincent H. Cohen Jr., Acting U.S. Attorney, and
Mark B. Stern, Alisa B. Klein, and Daniel Tenny, Attorneys.
2
Before: GARLAND,* Chief Judge, BROWN, Circuit Judge,
and WILLIAMS, Senior Circuit Judge.
Opinion for the Court filed by Senior Circuit Judge
WILLIAMS.
WILLIAMS, Senior Circuit Judge: This case poses the
question whether events have rendered moot a lawsuit
challenging enforcement of the federal Prevent All Cigarette
Trafficking Act (“PACT Act”), Pub. L. 111-154 (Mar. 31,
2010). The district court so found in Gordon v. Holder, 85 F.
Supp. 3d 78 (D.D.C. 2015), and we agree.
* * *
Consumers ordering goods to be delivered across state
lines are formally liable for sales taxes in the state of receipt,
but it’s difficult for those states to collect the taxes from
individual buyers. The PACT Act addresses this issue in the
context of cigarette sales (where the revenue at issue is high
in relation to the commodity’s pre-tax market value). It
prohibits the remote sale of cigarettes unless sales taxes have
been paid in advance. 15 U.S.C. § 376a(a)(3)-(4), (d). It
allows the federal government to seek civil and criminal
penalties directly from the sellers for the nonpayment of state
cigarette taxes, and it allows state and local governments to
sue the sellers in federal court for nonpayment of those taxes.
Id. § 378(c)(1)(A).
Robert Gordon, an enrolled member of the Seneca Indian
tribe of New York State, for some time operated a tobacco
business in the Allegany Indian Territories and sold tobacco
*
Chief Judge Garland was a member of the panel at the time
the case was argued but did not participate in this opinion.
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products from there across state lines. In 2010 he sought a
preliminary injunction barring enforcement of several sections
of the PACT Act. Though initially denying Gordon’s motion,
the district court on remand from this court in Gordon v.
Holder, 632 F.3d 722 (D.C. Cir. 2011), found it likely that the
provisions subjecting remote sellers to tax enforcement out-
of-state (albeit in federal court) violated the due process
clause of the Fifth Amendment. Gordon v. Holder, 826 F.
Supp. 2d 279, 288-93 (D.D.C. 2011). The court preliminarily
enjoined enforcement of those provisions. Id. at 297. We
affirmed, 721 F.3d 638 (D.C. Cir. 2013), explicitly addressing
the mootness issue as it then stood. Although finding that
Gordon’s closure of his business in the course of the litigation
had not mooted the appeal, we observed that facts might later
develop that had that effect. Id. at 643 & n.3.
Gordon renewed his pursuit of relief after our remand,
seeking declaratory relief and a permanent injunction, but two
new circumstances led the district court to conclude that the
case was moot and therefore to vacate the preliminary
injunction. Gordon, 85 F. Supp. 3d at 80-81, 85. First, in the
course of that effort Gordon stipulated that because of “health
problems and his deteriorating financial situation” he had no
intent to re-enter that business. J.A. 190. Second, the head of
the Alcohol and Tobacco Enforcement Branch of the Bureau
of Alcohol, Tobacco, Firearms, and Explosives (“BATFE”)
submitted a declaration stating that “[b]ased on all evidence
currently known to [the Bureau, it] has no intention to seek or
recommend enforcement action against Gordon under the
PACT Act . . . or any other federal statute or enforcement
mechanism.” J.A. 200.
* * *
A case is moot if “it is impossible for a court to grant any
effectual relief whatever to the prevailing party.” Decker v.
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Northwest Environmental Defense Ctr., 133 S. Ct. 1326, 1335
(2013) (citations and internal quotation marks omitted).
Gordon asserts that we may still grant him effective relief in
two respects. First, he argues that a permanent injunction
would eliminate a continuing risk that the federal government
will pursue both criminal and civil penalties for his past
violations of the PACT Act. Second, he argues that a
permanent injunction would shield him from collateral
consequences in the form of civil actions by states in which
he sold untaxed cigarettes.
Federal civil and criminal liability. In his brief and at
oral argument, Gordon argued that the declaration filed by the
head of BATFE fell materially short of the government
commitment on which we had relied in Clarke v. U.S., 915
F.2d 699, 701-03 (D.C. Cir. 1990) (en banc), as a basis for
concluding that the threat of federal government action had
effectively evaporated. There the government had said at oral
argument that “no one has ever suggested that there would be
a [prosecution],” and conceded “formally for the record that
the existence of a judgment during [the past period of an
expired statute] would be a complete and adequate defense to
any prosecution.” Id. at 701 (internal quotation marks
omitted). In holding that plaintiffs’ claim was moot, we relied
on the government’s explicit recognition that the existence of
a declaratory judgment that the statute was unconstitutional at
all relevant times would provide a complete defense. See id.
at 702. We concluded that such a representation at oral
argument would likely estop the government from taking a
contrary position in the future. We cited Farmland
Industries, Inc. v. Grain Bd. of Iraq, 904 F.2d 732, 739 (D.C.
Cir. 1990), where we relied on the proposition that the
defendant’s representation before us would estop it “from
asserting otherwise in another proceeding.”
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Here, whatever the effect of the earlier representation by
the head of BATFE, government counsel adopted at oral
argument positions matching those in Clarke. Counsel
characterized any federal prosecution or enforcement action
as “inconceivable,” noting that the PACT Act provisions were
“subject to a PI [preliminary injunction] at all relevant times”
and that “their constitutionality has never been upheld in a
court of appeals and has been called into question twice.”
Oral Arg. Recording at 24:10-23. Counsel added an
undertaking that as long as Gordon does not re-enter the
affected market, “the United States government will not seek
to hold him either civilly or criminally liable under the tax
provisions of the PACT Act for his past conduct.” Oral Arg.
Recording at 23:30-42. As in Clarke, “we cannot say that the
risk of an attempted prosecution is zero,” 915 F.2d at 702, but
(as there) we see in the government’s representation no
“deliberate equivocation,” id. at 703. The risk of federal
prosecution or civil penalties is no greater than in Clarke and
therefore cannot save this case from mootness.
Collateral consequences. Under 15 U.S.C. § 377(b),
state and local governments may seek civil penalties for past
violations of the PACT Act, including damages for unpaid
taxes. Gordon’s risk of exposure to collateral consequences
from vacatur of the preliminary injunction and the absence of
any replacement depends on whether we’re speaking of
potential enforcement in the District of Columbia or
elsewhere. As to enforcement in the District, the parties agree
that Gordon has not sold cigarettes for delivery in the District
since the PACT Act took effect, J.A. 197, so there appears to
be no genuine risk of enforcement in the one jurisdiction
where a permanent injunction issued by the district court (and
either affirmed or at least not reversed or altered by the court
of appeals) would have binding precedential effect.
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In an enforcement action outside the District, an
injunction from the United States district court, even if
affirmed by this court, would have only persuasive effect.
Moreover, given that the affirmed but now vacated
preliminary injunction, as well as the underlying opinions,
would likely have some persuasive effect, Gordon’s only
potential gain from continued litigation is the incremental
persuasive effect of that injunction’s being made permanent
(together with the opinions justifying the injunction). We
have held that an agency order’s potential persuasive effect in
state court was inadequate to preserve an otherwise moot
case. American Family Life Assur. Co. of Columbus v. FCC,
129 F.3d 625, 629 (D.C. Cir. 1997). Although American
Family Life involves a party trying to keep a case alive in
order to extinguish a precedent and plaintiff here tries to keep
the case alive in order to establish one (indeed, one without
precedential effect), we think such a “precedent” is
insufficient either way.
There are cases where a legal status has an automatic
effect in other jurisdictions (or even in the same one) in the
event of some contingency, and that risk is found to preserve
a challenge to the imposition of that status from mootness.
The clearest example of this is a criminal conviction, which
exposes the defendant to a range of direct consequences, most
obviously the effect of recidivism statutes, thus preventing
mootness of challenges to the conviction even after release
from prison and post-confinement supervision. At least since
Sibron v. New York, 392 U.S. 40, 55 (1968), the “mere
possibility” of collateral consequences has been enough to
preserve a challenge to a criminal conviction from mootness,
id. (citations and internal quotation marks omitted). See also
Spencer v. Kemna, 523 U.S. 1, 8-14 (1998) (declining to
extend the doctrine to a simple parole revocation). In Justin
v. Jacobs, 449 F.2d 1017, 1019 (D.C. Cir. 1971), we extended
that principle to a habeas corpus petitioner whose
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confinement under a civil commitment as a sexual offender
had ended but who might be disqualified from jury service,
voting, holding a driver’s license and owning a gun as a result
of another jurisdiction’s reliance on the commitment. In
Justin we appear to have assumed that the later adjudicating
jurisdictions would automatically or almost automatically
infer current mental illness from the prior commitment, an
inference that has no apparent parallel here. How far Justin
might be extended beyond its circumstances we need not say,
for the mere existence of the PACT Act, even though not
blunted by a court injunction, seems a far cry from the sort of
individualized branding at work in Justin.
Since Gordon faces only a remote risk of federal
prosecution or civil penalties, and any further merits decision
would not shield him from the effects of possible state or
local lawsuits, the case is moot. We affirm the district court’s
vacatur of the preliminary injunction for lack of jurisdiction,
and we therefore do not reach the district court’s further
conclusion that the case is prudentially moot.
So ordered.