Advn Mgmt Technol v. FAA

                  United States Court of Appeals

               FOR THE DISTRICT OF COLUMBIA CIRCUIT

        Argued April 6, 2000        Decided May 12, 2000 

                           No. 99-1314

              Advanced Management Technology, Inc., 
                            Petitioner

                                v.

               Federal Aviation Administration and 
                 Jane F. Garvey, Administrator, 
                Federal Aviation Administration, 
                           Respondents

             On Petition for Review of Orders of the 
                 Federal Aviation Administration

     Efrem M. Grail argued the cause for petitioner.  With him 
on the briefs was L. James D'Agostino.  Leigh T. Hansson 
entered an appearance.

     Christine N. Kohl, Attorney, U.S. Department of Justice, 
argued the cause for respondent.  With her on the brief were 

David W. Ogden, Acting Assistant Attorney General, and 
Anthony J. Steinmeyer, Attorney.

     Before:  Silberman, Williams and Sentelle, Circuit Judges.

     Opinion for the Court filed by Circuit Judge Williams.

     Williams, Circuit Judge:  In 1998 the Federal Aviation 
Administration ("FAA") adopted a subordinate office's find-
ings that petitioner Advanced Management Technology, Inc. 
("AMTI") had made misrepresentations in a bid proceeding in 
which AMTI eventually won a multi-million dollar contract.  
Because of the misrepresentations, the bidding was reopened.  
But because the FAA believed AMTI had not intended to 
defraud the government, it allowed AMTI to compete in the 
new round--in which AMTI again won the contract.  AMTI 
has no desire to relinquish the new contract in favor of the 
old one, but still seeks a reversal of the earlier findings or a 
new hearing with different procedures.  We dismiss the 
petition for want of standing.

                             *  *  *

     In August 1996 the FAA began procurement of a technical 
assistance contract for work with the Global Positioning 
System.  A group of contractors, bound by a May 1996 
"teaming agreement" and including AMTI, responded.  Fel-
low teammates were Innovative Solutions International 
("ISI") and Overlook Systems Technologies, Inc. ("Over-
look").  Overlook was "team leader."  Over the next year and 
a half, AMTI's teammates fluctuated in number and identity.  
In January 1998 the FAA issued its Request for Offers.  
AMTI, now the team leader of a reconstituted group, submit-
ted a proposal under which it would serve as the prime 
contractor and Overlook would be one of three subcontrac-
tors.

     AMTI represented in its offer that it had "entered into 
teaming Agreements with Overlook, ISI, and Zeta that estab-
lish goals for each subcontractor's participation in work ef-
forts on [the contract]."  The agreement referred to was the 
May 1996 agreement, not a new one.  AMTI further offered a 
chart with proposed work allocation percentages among the 

subcontractors, including Overlook, and identified key person-
nel from Overlook whose services would be used.  The FAA 
found AMTI's proposal the best value.  It nonetheless negoti-
ated with AMTI further in a quest for better terms.  On May 
8, 1998 AMTI submitted its "best and final offer," known in 
the trade as a BAFO.  This offer assured FAA that there 
were no material changes in personnel availability (i.e., it 
implicitly assured the FAA that key Overlook personnel 
would be used), and also warranted that it had successfully 
negotiated revised rates with subcontractors.

     AMTI failed to mention that on April 16 Overlook had 
provided AMTI its best and final offer with respect to 
Overlook's labor rates--an offer quite inconsistent with 
AMTI's May 8 offer to the FAA.  Whereas Overlook had 
offered to participate at a specified compensation rate on 
condition that it receive "approximately 33 percent" of the 
contract, AMTI's offer included Overlook's staffing at that 
compensation rate but at less than half the usage rate on 
which Overlook had conditioned its agreement.  AMTI's 
counsel would later attempt to justify this fact to the FAA's 
Office of Dispute Resolution for Acquisition ("Dispute Resolu-
tion Office") as follows:

     [B]ecause AMTI is a small, minority, woman-owned busi-
     ness, it quite simply could not afford to just cover the 
     additional expense of the Overlook personnel.... Over-
     look refused to lower the rates for its staff and thus, 
     AMTI was forced to make a business decision:  AMTI 
     could bid all [SEALED] of Overlook's people at the 
     [SEALED] multiplier and lose the contract, or AMTI 
     could cut the number of Overlook's positions, and bid 
     them at the higher rates.  AMTI could not discuss this 
     with Overlook, however, because no one at Overlook was 
     available to make the decision.
     
     On June 2, 1998 the FAA awarded AMTI the contract.  
Negotiations with Overlook continued, ultimately breaking 
down on June 29 with Overlook's withdrawal from the project.  
Meanwhile, competing bidders Camber Corporation and In-
formation Systems & Networks Corporation filed bid pro-
tests, alleging among other things "bait and switch"--that 

AMTI had misrepresented the availability of key personnel.  
Apparently the bid protests were fueled in no small part with 
inside information from Overlook.  FAA referred the protests 
to its Dispute Resolution Office.

     The FAA eventually adopted the findings of that office, 
concluding that "the use AMTI made of Overlook's April 16, 
1998 rates and its highly qualified key personnel was com-
pletely unauthorized.  AMTI proceeded to use those rates 
and personnel with no assurance that, once Overlook discov-
ered what AMTI had done, Overlook would still make those 
critical individuals available[.]"  Protests of Camber Corpora-
tion and Information Systems & Networks Corporation Un-
der Solicitation No. DTFA01-[96]-R-11087, Docket Nos. 
98-ODRA-00079 et al., at 36 (Sept. 3, 1998).  The FAA then 
ordered the bid process reopened.  AMTI was allowed to 
continue performing under the original contract in the inter-
im.  It was also allowed to recompete for the contract, as the 
FAA found no "actual intent to defraud the Government."  
Id. at 77.  The FAA denied AMTI's motion for reconsidera-
tion, and AMTI petitioned for review here.

     In the meantime, AMTI re-bid and won the contract.  In 
fact, the second award was more lucrative than the first.  
AMTI nonetheless argues that it was the victim of findings 
unsupported by substantial evidence and contrary to law, and 
that it was subjected to a dispute resolution procedure (the 
hearing before the Dispute Resolution Office) which violated 
statutory authority1 and constitutional due process.  But 
AMTI does not ask us to restore the first contract.  Rather, 
it seeks mere reversal of the FAA's findings, or in the 
alternative a remand to the FAA for a hearing that satisfies 
statutory and constitutional standards.

                              * * *

     The FAA challenges AMTI's standing, arguing that be-
cause AMTI is currently performing under a more lucrative 

__________
     1 The authority at issue is s 348 of the Department of Trans-
portation and Related Agencies Appropriations Act, 1996, Pub. L. 
No. 104-50, 109 Stat. 460 (1995).

contract, it can't really be injured.  The claim may sound like 
one of mootness--a justiciable controversy existed but no 
longer remains--but the timing makes AMTI's problem one 
of standing.  AMTI was awarded the second contract on June 
24, 1999, before either the FAA's denial of reconsideration or 
AMTI's filing the present petition for review (July 30, 1999).  
Standing is assessed "at the time the action commences," 
Friends of the Earth, Inc. v. Laidlaw Environmental Ser-
vices (TOC), Inc., ___ U.S. ___, 120 S. Ct. 693, 709-10 (2000), 
i.e., in this case, at the time AMTI sought relief from an 
Article III court, when AMTI held the more lucrative second 
contract.

     Contrary to AMTI's assumptions, Article III courts do not 
ordinarily have jurisdiction to issue, as the Seventh Circuit 
has put it, "Writs of Erasure" to administrative agencies or 
district courts to cleanse their opinions of material distressing 
to winners.  United States v. Accra Pac, Inc., 173 F.3d 630, 
632 (7th Cir. 1999).  AMTI "must show (1) it has suffered an 
'injury in fact' that is (a) concrete and particularized and (b) 
actual or imminent, not conjectural or hypothetical;  (2) the 
injury is fairly traceable to the challenged action of the 
defendant;  and (3) it is likely, as opposed to merely specula-
tive, that the injury will be redressed by a favorable deci-
sion."  Friends of the Earth, 120 S. Ct. at 704.  AMTI claims 
reputational injury, monetary injury from the costs of litiga-
tion and rebidding, and injury to its right to a legally valid 
procurement process.

1.   Reputational Injury

     AMTI says the FAA branded it a "fraud" and a "liar."  
With this (mis)characterization of the FAA's findings, AMTI 
seeks to bring itself within the reach of reputational injury 
cases such as Meese v. Keene, 481 U.S. 465 (1987).  See also 
Joint Anti-Fascist Refugee Committee v. McGrath, 341 U.S. 
123 (1951);  Southern Mutual Help Ass'n, Inc. v. Califano, 
574 F.2d 518 (D.C. Cir. 1977) ("SMHA");  Old Dominion 
Dairy Products, Inc. v. Secretary of Defense, 631 F.2d 953 
(D.C. Cir. 1980).

     Standing cannot be "inferred argumentatively" but rather 
"must affirmatively appear in the record."  Spencer v. Kem-
na, 523 U.S. 1, 10-11 (1998) (internal quotations omitted).  All 
that affirmatively appears here is AMTI's vast exaggeration 
of the FAA's findings;  we have no allegations, much less 
evidence, as to their present or future consequences.  The 
FAA specifically declined to find any intent to defraud;  a 
"bait and switch" finding can be made solely on negligent 
misrepresentations.  AMTI notes that the October 5, 1998 
issue of Federal Contracts Reports, which relayed the FAA's 
decision to the field, quoted a remark of counsel for the 
Camber Corporation that the order "vindicates the basic 
principle that you can't lie to the government to get a 
contract."  But the government as adjudicator can hardly be 
held responsible for the gloatings of a triumphant advocate.  
AMTI offered no evidence that the FAA's findings cast any 
shadow over its business activities, and the "all is forgiven" 
message implicit in FAA's re-award of the contract suggests 
the improbability of such a shadow.

     With this sparse record, we need not probe the subtle 
boundaries of precedent.  In Meese v. Keene, for instance, the 
Court found on the basis of survey data and expert affidavits 
that if plaintiff were to exhibit certain imported films under 
the government's mandatory label of "political propaganda," 
"his personal, political, and professional reputation would 
suffer and his ability to obtain re-election and to practice his 
profession would be impaired."  481 U.S. at 473-74 (internal 
quotation marks omitted).  In SMHA a grantor agency had 
prematurely terminated plaintiff grantee's multi-year grant, 
accompanying the termination with a scathing audit.  Though 
the termination itself--which we found required a hearing 
under the agency's regulations--was surely enough, we 
stressed the severity of the agency's condemnation of plaintiff 
and the overwhelming probability that future applications 
would receive an "inhospitable reception."  574 F.2d at 524.  
Old Dominion Dairy Products similarly involved devastating 
findings with present and future preclusion from Government 
work.  631 F.2d at 955, 964.  Cf. Kartseva v. Department of 
State, 37 F.3d 1524, 1528 (D.C. Cir. 1994) (reviewing due 

process merits issue when government may have "automati-
cally" precluded plaintiff from future jobs).

     AMTI has not begun to show the likelihood of injury from 
the FAA's characterizations of its conduct.  Charitably, the 
injury is "speculative"--the ultimate label for injuries too 
implausible to support standing.  See Alamo v. Clay, 137 
F.3d 1366, 1370 (D.C. Cir. 1998);  J. Roderick MacArthur 
Foundation v. FBI, 102 F.3d 600, 606 (D.C. Cir. 1996).  And 
reputational injury alone would not get AMTI very far in 
seeking a new hearing subject to constitutional due process.  
See Siegert v. Gilley, 500 U.S. 226, 233 (1991) ("Defamation, 
by itself, is a tort actionable under the laws of most States, 
but not a constitutional deprivation.").  As we shall see, 
AMTI has nothing more.

2.   Monetary Injury

     AMTI asserts several different monetary injuries:  litiga-
tion costs in the Dispute Resolution Office proceeding, costs 
of rebidding, and litigation costs in defending a qui tam 
lawsuit in the eastern district of Virginia allegedly spawned 
by the proceeding at FAA.  AMTI has offered no detail for 
any of these costs, which may well be more than offset by the 
award of the more lucrative second contract.  But even if 
AMTI has concrete and particularized monetary injuries, and 
if they are fairly traceable to the FAA and its Dispute 
Resolution Office,2 AMTI has only one theory of redressabili-
ty:  the Equal Access to Justice Act ("EAJA"), 28 U.S.C. 
s 2412.  According to AMTI, if we reverse the FAA, thereby 
making AMTI a "prevailing party" under EAJA, AMTI can 
recover some of its litigation expenses.

__________
     2 AMTI states that the "sole genesis" of the qui tam action was 
the Dispute Resolution Office's "finding of a fraudulent 'bait and 
switch.' "  If so, this seems to mark the qui tam action as frivolous 
on its face since the False Claims Act bars actions solely "based 
upon" public disclosures in administrative hearings.  See 31 U.S.C. 
s 3730(e)(4)(A);  United States ex rel. Findley v. FPC-Boron Em-
ployees' Club, 105 F.3d 675 (D.C. Cir. 1997);  United States ex rel. 
Siller v. Becton Dickinson & Co., 21 F.3d 1339, 1347-48 (4th Cir. 
1994).

     Under AMTI's theory anyone meeting EAJA's wealth lim-
its would have constitutional standing (although often not 
prudential standing) in relation to any government decision:  
if they prevailed, they might recover attorneys' fees for 
reversing the agency's action.  EAJA does not work this way.  
EAJA allows recovery of costs for prevailing parties in "judi-
cial review of agency action," 28 U.S.C. s 2412(d)(1)(A), but 
the party must first prevail in a "court having jurisdiction of 
that action," id.  In other words, there must be standing and 
otherwise proper subject matter jurisdiction for the underly-
ing action;  EAJA is not a highway to federal court for 
anyone wishing to uphold the rule of law.  See Democratic 
Senatorial Campaign Committee v. FEC, 139 F.3d 951, 953 
(D.C. Cir. 1998);  Lane v. United States, 727 F.2d 18, 20-21 
(1st Cir. 1984).  As the only means identified by AMTI for 
recovery of costs is a non-starter, this injury--assuming it 
exists at all on a net basis--is not redressable.

3.   Right to a Legal Procurement Process

     AMTI asserts finally that the FAA's creation and use of its 
Dispute Resolution Office deprives AMTI of its "right to a 
legally valid procurement process."  National Maritime Un-
ion of America, AFL-CIO v. Commander, Military Sealift 
Command, 824 F.2d 1228, 1237 (D.C. Cir. 1987).  As a purely 
backward-looking claim, this adds nothing to the prior discus-
sion.  AMTI has identified no past injury that is within the 
power of the court to redress.  Compare Lujan v. Defenders 
of Wildlife, 504 U.S. 555, 573 n.8 (1992) (allowing parties 
standing to enforce a procedural norm "designed to protect 
some threatened concrete interest").

     As a forward-looking claim it fares no better.  If AMTI had 
alleged that it expected to seek future FAA contracts and 
likely would re-encounter the offending procedure, that claim 
might provide it the necessary concrete interest in removing 
the alleged procedural flaw.  In Scheduled Airlines Traffic 
Offices, Inc. v. Department of Defense, 87 F.3d 1356, 1358-59 
(D.C. Cir. 1996), we found standing for a winning bidder--but 
only because it intended to bid on future similar contracts and 
raised legal claims against substantive rules that it thought 

were biased against its success.  Not only does AMTI not 
mention future bidding plans, but the procedures to which it 
objects are ones triggered only by specified bidding disputes.  
AMTI does no more to show a likelihood of being subjected to 
these procedures than the plaintiff in Los Angeles v. Lyons, 
461 U.S. 95, 105 (1983), showed a likelihood of being subjected 
to future chokeholds.  See also Spencer, 523 U.S. at 15-16 
(dismissing as "purely a matter of speculation" whether the 
petitioner would in the future appear as a civil or criminal 
witness and have his parole revocation used against him).

                              * * *

     The petition for review is

                                                       Dismissed.