Kitty Hawk Aircargo, Inc. v. Chao

United States Court of Appeals
Fifth Circuit
F I L E D
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT July 20, 2005

Charles R. Fulbruge III
Clerk
No. 04-10860

KITTY HAWK AIRCARGO, INC.,

Plaintiff-Appellee

versus

ELAINE CHAO, Etc.

Defendant

AIR LINE PILOTS ASSOCIATION; HAL WINTERS

Intervenor Defendants-Appellants

--------------------
Appeals from the United States District Court
for the Northern District of Texas
--------------------

Before, DAVIS, STEWART and DENNIS, Circuit Judges.

DENNIS, Circuit Judge:

Intervenors Airline Pilots Association (ALPA) and Hal Winters

appeal the district court’s granting of summary judgment to the

plaintiff, Kitty Hawk Aircargo, Inc. The district court enjoined

the defendant, the Secretary of the United States Department of

Labor (the Secretary), from implementing, against Kitty Hawk, a

ruling of the Department of Labor’s Administrative Review Board

(ARB) concluding that pilots are “service employees” subject to the

prevailing wage requirements of the McNamara-O'Hara Service Contract
 No. 04-10772
-2-

Act (SCA). We conclude that Kitty Hawk lacked standing to

challenge the ARB’s ruling in the district court. We therefore

reverse the judgment of the district court and remand with

instruction to dismiss the complaint.

I

The United States Postal Service contracts with air cargo

carriers for the transportation of the nation’s mail. There are

three major types of Postal Service air cargo contracts: ANET, WNET

and CNET contracts. ANET and WNET contracts are year-round

contracts; CNET contracts are short-term peak Christmas season

contracts. In addition to the three major types of contracts, the

Postal Service enters into some air transport contracts between

certain pairs of cities during peak periods (point-to-point

contracts) and for mail delivery on direct and indirect flights on

the carrier’s transportation system between certain dates (ASYS

contracts). The SCA applies to WNET, ANET, and CNET contracts and,

apparently, to point-to-point contracts. There are exemptions,

however, for certain ASYS contracts based upon the proportion of

the carrier’s revenue attributable to Postal Service business. The

plaintiff, Kitty Hawk Air Cargo Inc., formerly held certain

contracts subject to the SCA.

Every contract subject to the SCA must include, among other

things, a “provision specifying the minimum monetary wages to be

paid the various classes of service employees in the performance of

the contract or any subcontract thereunder, as determined by the
 No. 04-10772
-3-

Secretary, or his authorized representative, in accordance with

prevailing rates for such employees in the locality . . . .”1 The

Secretary has delegated the task of making prevailing wage

determinations to the Wage and Hour division (WHD).2 In 1996, the

WHD issued wage determination No. 95-0229 (Rev. 1) which

significantly increased the prevailing wage determination for

captains and first officers (pilots) transporting mail.

The Postal Service, which is required by regulation to

increase contract prices to defray the additional costs of a

changed wage determination,3 challenged the wage determination.

Numerous other interested parties also challenged the new wage

rate. The parties argued that the WHD used an improper methodology

to calculate the new wage rate and also argued that pilots are

exempt from the prevailing wage provisions of the SCA because they

are “professionals” rather than “service employees” under the SCA.

On December 13, 1996, the WHD issued a letter ruling reducing the

pilot wage rate for ANET and WNET pilots. The letter ruling also

explicitly exempted pilots on CNET and other short-term contracts

from that wage rate and instead issued a separate, significantly

lower, rate for those pilots. The WHD, however, failed to address

whether pilots are professionals and therefore not subject to the

prevailing wage provisions of the SCA.

1
41 U.S.C. § 351(a)(1).
2
29 C.F.R. § 4.1a(c).
3
22 C.F.R. § 22.1006.
 No. 04-10772
-4-

Kitty Hawk and the Postal Service, among others, appealed the

WHD’s decision to the ARB. The ARB remanded the matter to the WHD

to make an initial determination regarding the applicability of the

SCA’s prevailing wage requirements to pilots. On remand, the WHD

determined that pilots are not professionals exempt from the wage

provisions of the SCA. Kitty Hawk, the Postal Service and others

again appealed to the ARB. The ARB affirmed the WHD’s

determination that pilots are not exempt from the prevailing wage

provisions of the SCA but found that the WHD’s method of

calculating the wage rates for ANET and WNET pilots was contrary to

the statute. Thus, the ARB remanded the matter to the WHD for a

recalculation of the prevailing wage for air cargo pilots working

on ANET and WNET Postal Service contracts.

Kitty Hawk filed a complaint in the district court on July 16,

2001 seeking judicial review of the ARB’s decision. On January 10,

2001, however, the Postal Service had entered into a seven-year

renewable contract with FedEx for the year-round, nationwide

transportation of mail.4 Accordingly, by August 21, 2001, the

Postal Service had terminated, for its own convenience, all of

Kitty Hawk’s major year-round contracts. On January 29, 2002,

Kitty Hawk entered into a settlement agreement with the Postal

Service concerning the termination of Kitty Hawk’s largest

contract, WNET 99-01. As part of the settlement, Kitty Hawk agreed

4
See Emery Worldwide Airlines, Inc. v. United States, 264
F.3d 1071, 1074 (Fed. Cir. 2001)(discussing the FedEx contract).
 No. 04-10772
-5-

to indemnify the Postal Service for any liability to the pilots who

had worked on that and other contracts “for [SCA] issues related to

the disputed pilot wage determinations.” Kitty Hawk received more

than $30 million in the settlement.

ALPA and Captain Hal Winters, a pilot employed by another air

cargo company, intervened in the district court, with Kitty Hawk’s

consent, on the side of the Secretary. On May 30, 2002, ALPA and

Winters filed a motion for summary judgment arguing, among other

things, that Kitty Hawk lacked standing to challenge the ARB’s

decision. The district court denied the motion without opinion.

The Secretary and Kitty Hawk subsequently filed cross-motions for

summary judgment. The district court granted Kitty Hawk’s motion

for summary judgment and denied that of the Secretary.

The district court’s initial judgment set aside the ARB’s

ruling and enjoined the Secretary from implementing the decision.

The Secretary filed a motion to amend the judgment arguing that,

because Kitty Hawk was the only party to the ARB’s action that

sought judicial review, the judgment should be limited to Kitty

Hawk. The district court agreed and issued an amended judgment

which did not set aside the ARB ruling but merely enjoined the

Secretary from taking action against Kitty Hawk in accordance with

the ruling or from taking any action against Kitty Hawk that would

be inconsistent with the district court’s finding that Kitty Hawk

pilots are not service employees subject to the prevailing wage
 No. 04-10772
-6-

requirements of the SCA. Intervenors ALPA and Winters appeal from

the amended judgment; the Secretary did not appeal.

II

As an initial matter we address Kitty Hawk’s motion to dismiss

the appeal for lack of jurisdiction. According to Kitty Hawk, the

appellants lack standing to appeal because neither was a party at

the district court and neither can individually satisfy the Article

III requirement of injury resulting from the judgment. We conclude

that ALPA satisfies Article III and, therefore, this court has

jurisdiction over the appeal, regardless of Winters’ ability to

independently satisfy Article III.

ALPA and Winters intervened in the district court on the side

of the Secretary with the consent of Kitty Hawk. Generally, a

party’s status as an intervenor below does not confer standing to

appeal if the party on whose side intervention was permitted

chooses not to appeal.5 “Rather, intervenors who wish to prosecute

an appeal on their own must separately fulfill the injury,

causation, and redressability requirements of Article III.”6

“Where standing to appeal is at issue, appellants must

demonstrate some injury from the judgment below.”7 The judgment

below applies only to the Secretary and Kitty Hawk. Thus, Kitty

Hawk argues that because there is nothing in the record to

5
See Diamond v. Charles, 476 U.S. 54, 68 (1986).
6
Sierra Club v. Babbitt, 995 F.2d 571, 574 (5th Cir. 1993).
7
Id., 575.
 No. 04-10772
-7-

demonstrate that ALPA has any relationship to the Kitty Hawk

pilots, neither ALPA nor the pilots it represents are injured by

the judgment. Furthermore, Kitty Hawk argues that Winters, a pilot

who does not work for Kitty Hawk, is not injured by the district

court’s decision.

ALPA is the certified collective bargaining representative of

the Kitty Hawk pilots. Kitty Hawk does not dispute that ALPA

represents the pilots nor does it seriously dispute that, as the

collective bargaining representative of the pilots whose wages are

at issue, ALPA has standing to appeal the district court’s

judgment. Rather, Kitty Hawk contends that ALPA cannot point to

any proof in the record of its representation of the Kitty Hawk

pilots and, therefore, this court lacks jurisdiction over the

appeal.

Kitty Hawk is correct that there is no evidence in the record

proving that ALPA is the collective bargaining representative of

the Kitty Hawk pilots. At the time that ALPA intervened in the

district court action, it did not represent the Kitty Hawk pilots.

Therefore, it did not allege that it represented those pilots and

did not submit evidence to that effect. In 2003, however, ALPA

merged with the Kitty Hawk pilots’ prior certified collective

bargaining representative, the Kitty Hawk Pilots Association (KPA).

On January 5, 2004, the National Mediation Board (NMB) approved the

transfer of KPA’s certification to ALPA. This approval is

published in the official administrative agency reporter, is
 No. 04-10772
-8-

available on the agency’s website and on Lexis and Westlaw.8 Thus,

ALPA’s representation of the Kitty Hawk pilots is capable of

accurate and ready determination by resort to a source whose

accuracy on the matter cannot reasonably be questioned. We

therefore take judicial notice of ALPA’s status as the collective

bargaining representative of the Kitty Hawk pilots.9 Additionally,

we conclude that as the collective bargaining representative of the

Kitty Hawk pilots, ALPA has standing to bring this appeal.10

Furthermore, because jurisdiction over this appeal has vested,

Winters’ presence in the appeal does not destroy jurisdiction even

8
See 31 NMB 103; 31 NMB No. 25; 2004 NMB Ltr. LEXIS 1.
9
See, e.g., United States v. Herrera-Ochoa, 245 F.3d 495,
501 (5th Cir. 2001)(quoting Fed. R. Evid. § 201(b))(Internal
quotation marks omitted)(“Judicial notice may be taken of any
fact not subject to reasonable dispute in that it is either (1)
generally known within the territorial jurisdiction of the trial
court or (2) capable of accurate and ready determination by
resort to sources whose accuracy cannot reasonably be
questioned.")
10
See, e.g., Supreme Beef Processors, Inc. v. USDA, 275
F.3d 432, 437 n.14 (5th Cir. 2001) (quoting Central and South
West Services, Inc. v. EPA, 220 F.3d 683, 698 (5th Cir.
2000))(“An association has standing to bring a suit on behalf of
its members when: (1) its members would otherwise have standing
to sue in their own right; (2) the interests it seeks to protect
are germane to the organization's purpose; and (3) neither the
claim asserted nor the relief requested requires the
participation of individual members.")
 No. 04-10772
-9-
if he cannot individually satisfy the requirements of Article III.11

Accordingly, we deny Kitty Hawk’s motion to dismiss the appeal.

III

We now turn to the appellants’ argument that Kitty Hawk lacked

standing to challenge the ARB’s ruling in the district court. As

previously noted, standing, one of the doctrines arising under the

case and controversy requirement of Article III, requires that

plaintiffs establish that: “they have suffered an 'injury in fact';

the injury is 'fairly traceable' to the defendant's actions; and

the injury will 'likely . . . be redressed by a favorable

decision."12 "An injury in fact [is] an invasion of a legally

protected interest which is (a) concrete and particularized, and

(b) actual or imminent, not conjectural or hypothetical."13 Where,

as here, a plaintiff is seeking injunctive or declaratory relief,

the plaintiff must demonstrate that there is a substantial

likelihood that it will suffer injury in the future.14 Finally,

"standing is . . . determined as of the commencement of the suit."15

11
Ruiz v. Estelle, 161 F.3d 814, 832 (5th Cir.
1998)(holding that where a valid Article III case or controversy
exists, the court’s jurisdiction vests and the presence of
additional parties who could not, individually, satisfy Article
III does not destroy jurisdiction).
12
Public Citizen, Inc. v. Bomer, 274 F.3d 212, 217 (5th
Cir. 2001)(quoting Lujan v. Defenders of Wildlife, 504 U.S. 555,
560-61 (1992)).
13
Lujan, 504 U.S. at 560.
14
Bauer v. Texas, 341 F.3d 352, 357-58 (5th Cir. 2003).
15
Id., 571-72 n.5.
 No. 04-10772
-10-
On July 16, 2001, the date of the commencement of this suit,

Kitty Hawk still held at least one contract subject to the SCA and

to the disputed prevailing wage determination.16 Those contracts

all contained a clause, as mandated by regulation,17 stating that

the Postal Service would adjust the contract price if any

applicable prevailing wage rate was increased. Thus, Kitty Hawk

was not likely to suffer any direct financial harm as a result of

any increase in the prevailing wage for pilots applicable to

contracts it held when it filed its complaint. Moreover, Kitty

Hawk has admitted that, when calculating labor costs for proposals

on Postal Service contracts subject to the SCA, it considers the

applicable prevailing wage determinations. Essentially, the cost

of any increased wage rate for pilots will be passed on to the

Postal Service. Therefore, Kitty Hawk is not likely to suffer any

lost profits in the future as a result of an increase in the

disputed prevailing wage rate.

Recognizing this fact, Kitty Hawk instead argues that it is

likely to suffer various indirect harms. As to future contracts,

Kitty Hawk claims that, if the prevailing wage determination is

increased, it would have to either pay all pilots an allegedly

noncompetitive wage, or implement a two-tier wage system which,

according to Kitty Hawk, would interfere with the existing

16
The record indicates that Kitty Hawk’s largest contract,
WNET-99-01, was terminated on August 21, 2001 and that its other
contracts were either completed or terminated by that date.
17
See 22 C.F.R. § 22.1006.
 No. 04-10772
-11-
seniority system and prevent Kitty Hawk from assigning pilots to

routes according to established operational procedures and business

considerations. Kitty Hawk, however, does not allege and has not

proven that it is likely to bid on or to receive future ANET or

WNET contracts. Rather, Kitty Hawk’s opportunities for Postal

Service contracts are now apparently limited to CNET, ASYS and

point-to-point contracts. The disputed wage determination,

however, does not apply to CNET contracts and may not apply to

point-to-point and ASYS contracts.18 The wage determination that

applies to CNET (and possibly other short-term contracts) mandates

a far lower wage than the disputed wage determination and there is

no indication in the record that the reduced wage rate applicable

to those contracts is likely to increase to an objectionable level

in the near future. In addition, the SCA itself only applies to

ASYS contracts under certain circumstances. Thus, Kitty Hawk’s

claims of injury resulting from future contracts relies on a string

of hypotheticals and conjectures: if it receives future contracts,

if those contracts are subject to the SCA, if the disputed

18
In its 1996 letter ruling, the WHD concluded that the
methodology used to calculate the prevailing wage rate for WNET
and ANET contracts, which included the consideration of the wages
paid to pilots by major airlines, was inappropriate for “smaller
short term contracts.” Thus, the WHD issued a separate - much
lower - prevailing wage for “other small limited service
contracts, including the Postal Service’s CNET . . . contracts.”
Point-to-point and ASYS contracts are smaller limited service
contracts and, therefore, are likely subject to the lower
prevailing wage determination. The disputed wage determination
itself, as opposed to the letter ruling, however, excludes only
CNET contracts. Thus, it is unclear from the record which
prevailing wage determination is applicable to point-to-point and
ASYS contracts.
 No. 04-10772
-12-
prevailing wage applies to those contracts or if the prevailing

wage rate applicable to those contracts significantly increases,

etc.

Moreover, even if all of these conjectures become reality, the

primary injury Kitty Hawk claims it will suffer, namely, having to

implement a two-tiered wage system, is likely no injury at all.

Kitty Hawk admittedly already has a seniority system whereby more

senior pilots receive preference for more lucrative routes. It is

not apparent, and Kitty Hawk has never proven, that having Postal

Service contracts that generate pilot income greater than that

generated by commercial contracts will interfere with that system.

Furthermore, Kitty Hawk cites nothing in the record, beyond a

conclusory statement in the affidavit of its Chief Executive

Officer, in support of its assertion that an increased prevailing

wage determination will interfere with its ability to assign pilots

according to standard operating procedures and business

considerations. At the summary judgment stage, "the plaintiff can

no longer rest on . . . mere allegations, but must set forth by

affidavit or other evidence specific facts" validating his right to

standing.19

Kitty Hawk also claims that it has standing by virtue of its

assumption of the Postal Service’s liability for back pay per the

contract termination settlement agreement. Of course, the contract

had not yet been terminated when Kitty Hawk filed this suit and

19
Lujan, 504 U.S. at 561 (emphasis added).
 No. 04-10772
-13-
Kitty Hawk had not assumed liability for any back pay.

Furthermore, there is no indication in the record that the specific

terms of the settlement agreement were anticipated by Kitty Hawk at

the time it filed the complaint. “As with all questions of subject

matter jurisdiction except mootness, standing is determined as of

the date of the filing of the complaint . . . .”20 The party

invoking the jurisdiction of the court cannot rely on events that

unfolded after the filing of the complaint to establish its

standing.21 Thus, Kitty Hawk’s assumption of the Postal Service’s

liability for back pay is not relevant to the standing analysis.

Finally, Kitty Hawk submitted a letter following oral

argument, purportedly pursuant to Rule 28(j) of the Federal Rules

20
Carr v. Alta Verde Indus., Inc., 931 F.2d 1055, 1061 (5th
Cir. 1991); See also Newman-Green, Inc. v. Alfonzo-Larrain, 490
U.S. 826, 830 (1989)("The existence of federal jurisdiction
ordinarily depends on the facts as they exist when the complaint
is filed"); White v. Lee, 227 F.3d 1214, 1243 (9th Cir. 2000)
("Standing is examined at 'the commencement of the litigation'");
Park v. Forest Serv. of the United States, 205 F.3d 1034, 1037
(8th Cir. 2000) ("We do not think, however, that the actual use
of checkpoints in 1997, 1998, and 1999 is relevant on the issue
of standing because all of these events occurred after [the
plaintiff] filed her original complaint"); Perry v. Arlington
Heights, 186 F.3d 826, 830 (7th Cir. 1999)(“Because standing goes
to the jurisdiction of a federal court to hear a particular case,
it must exist at the commencement of the suit.”)
21
See Lujan, 504 U.S. at 570 n.4 (explaining that acts
occurring after commencement of the suit cannot retroactively
create jurisdiction); Park, 205 F.3d at 1037 (8th Cir. 2000)
(holding that a plaintiff cannot rely on events occurring after
commencement of the suit to establish injury-in-fact) Perry, 186
F.3d at 830 (concluding that plaintiff, who established residency
in municipality after initiating suit, did not have standing to
challenge the constitutionality of articles of the municipal code
because he was not a resident when he filed his complaint.)
 No. 04-10772
-14-
of Appellate Procedure, raising new arguments concerning its

standing. Specifically, Kitty Hawk claims, that “the Secretary’s

position is that an employee covered by a monthly wage

determination under the . . . [SCA] who works even one day under a

covered contract must be paid at the SCA level for the entire

month.”22 Kitty Hawk cites no authority for this statement.

Therefore, this assertion certainly does not fall within the ambit

of Rule 28(j), which permits parties to bring pertinent legal

authority to the court’s attention following briefing.

Furthermore, without a citation either to the record or to legal

authority we cannot gauge the veracity of the assertion. The

applicable regulations do not contain such a requirement and none

was apparently alleged in the district court. Accordingly, we do

not consider Kitty Hawk’s allegation probative of its standing.

In sum, Kitty Hawk has not established that, at the time it

filed its complaint, it had suffered any injury-in-fact, or that

there was a substantial likelihood that it would suffer an injury-

in-fact in the future, and the district court lacked jurisdiction

over Kitty Hawk’s complaint. Accordingly, we REVERSE the judgment

of the district court and REMAND with instructions to dismiss the

complaint.

22
Kitty Hawk also contends that its agreement to indemnify
the Postal Service for back pay was not voluntary. This
contention is irrelevant for the reasons previously stated.