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Tulsa Airports Improv. Trust v. FAA, 15-5009 (2016)

Court: Court of Appeals for the Tenth Circuit Number: 15-5009 Visitors: 18
Filed: Oct. 14, 2016
Latest Update: Mar. 03, 2020
Summary: FILED United States Court of Appeals Tenth Circuit PUBLISH October 14, 2016 Elisabeth A. Shumaker UNITED STATES COURT OF APPEALS Clerk of Court TENTH CIRCUIT TULSA AIRPORTS IMPROVEMENT TRUST, for and on behalf of Cinnabar Service Company, Petitioner, v. No. 15-5009 FEDERAL AVIATION ADMINISTRATION, Respondent. ON PETITION FOR REVIEW OF A FINAL ORDER OF THE FEDERAL AVIATION ADMINISTRATION (Court of Federal Claims No. 13-906-CFL) Roger M. Gassett, of Hall, Estill, Hardwick, Gable, Golden & Nelson,
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                                                                    FILED
                                                        United States Court of Appeals
                                                                Tenth Circuit

                                   PUBLISH                    October 14, 2016
                                                            Elisabeth A. Shumaker
                     UNITED STATES COURT OF APPEALS             Clerk of Court

                              TENTH CIRCUIT



 TULSA AIRPORTS IMPROVEMENT
 TRUST, for and on behalf of Cinnabar
 Service Company,

       Petitioner,
 v.                                                   No. 15-5009
 FEDERAL AVIATION
 ADMINISTRATION,

        Respondent.



            ON PETITION FOR REVIEW OF A FINAL ORDER
            OF THE FEDERAL AVIATION ADMINISTRATION
                (Court of Federal Claims No. 13-906-CFL)


Roger M. Gassett, of Hall, Estill, Hardwick, Gable, Golden & Nelson, P.C.,
Tulsa, Oklahoma, (John M. Hickey, of Hall, Estill, Hardwick, Gable, Golden &
Nelson, P.C., and Steven K. Metcalf of McDonald, McCann, Metcalf & Carwile,
L.L.P., Tulsa, Oklahoma, with him on the briefs), for Petitioner-Appellant.

Edward Himmelfarb, Attorney, Appellate Staff, Civil Division, Department of
Justice, Washington, D.C., (Benjamin C. Mizer, Principal Deputy Assistant
Attorney General; and Michael S. Raab, Attorney, Appellant Staff, Civil Division,
Department of Justice, Washington, D.C., with him on the brief), for Respondent-
Appellee.


Before BRISCOE, MURPHY and PHILLIPS, Circuit Judges.


BRISCOE, Circuit Judge.
      Tulsa Airports Improvement Trust (TAIT) seeks reimbursement for

amounts it paid to a third-party contractor in furtherance of a noise abatement

program funded primarily by grants from the Federal Aviation Administration

(FAA). Because its petition for review of agency action was not timely filed, we

dismiss the action.

                                         I

      Since the mid-1990s, TAIT has been working to reduce noise caused by the

Tulsa International Airport. Tulsa Airports Improvements Trust v. United States,

120 Fed. Cl. 254
, 256–57 (2015). TAIT’s efforts have largely been funded by

grants from the FAA. 
Id. at 257.
In 2002, while awaiting the approval of

additional grant funding, TAIT instructed its contractors to place some projects

on hold until additional funds were approved. 
Id. at 257–58.
As a result of the

delay, some contractors “demanded contract increases or terminated their

contracts.” 
Id. at 258.
Consequently, TAIT paid $705,913.40 to its contractors

and then sought reimbursement from the FAA. 
Id. The FAA
initially reimbursed

TAIT for the costs, but subsequently demanded repayments totalling $656,574.37

after determining that the payments were “contract delay/escalation costs,” which

were “not allowable” costs under the grants. 
Id. TAIT reimbursed
the FAA for

these amounts. 
Id. In 2010,
TAIT sought reconsideration and the FAA provided


                                         2
reimbursements for supplemental allowable costs in the amount of $569,566.00.

See Agency Record (AR) at 2187.

      On January 23, 2012, TAIT informed the FAA that it had reviewed the

remaining unpaid expenses 1 and had “identified numerous cost categories which

[were] eligible for reimbursement.” AR at 487. TAIT requested that the FAA

review the attached documentation and approve the reimbursements. 
Id. On October
24, 2012, the FAA’s Southwest Region responded that it had “carefully

examined the information” provided and “[could not] make a favorable

determination of additional allowable costs.” AR at 1140. This letter stated that

“additional reviews on the [grants] would not be considered an efficient use of

resources.” 
Id. TAIT responded
by appealing to the FAA’s Associate

Administrator for Airports on December 6, 2012. AR at 1141. On December 31,

2012, the Associate Administrator for Airports issued a letter to TAIT stating

that, because TAIT’s most recent request for reimbursement did not delineate

costs that had been reimbursed as well as allowable costs that were outstanding,

the FAA was “unable to find that there [were] potentially eligible costs that ha[d]

not been reimbursed.” AR at 2190. The letter further stated that TAIT should




      1
        Although the parties do not specify the amount contested, we estimate
from the record that TAIT is seeking reimbursement for a portion of
approximately $87,000.00 in outstanding expenses.

                                         3
resubmit any information that it believed had not been considered. 
Id. TAIT submitted
no further documentation to the FAA.

       Instead, on November 14, 2013, TAIT filed a breach of contract action in

the Court of Federal Claims, invoking jurisdiction under the Tucker Act, 28

U.S.C. § 1491(a)(1). Tulsa Airports Improvements 
Trust, 120 Fed. Cl. at 256
.

TAIT alleged that the FAA had wrongfully determined that the payments in

question were “not allowable grant costs.” 
Id. at 256.
The Court of Federal

Claims determined that it did not have subject matter jurisdiction because either

49 U.S.C. § 46110 or 49 U.S.C. § 47111 vested exclusive jurisdiction in the

United States Court of Appeals. 
Id. at 263.
Accordingly, it transferred the case to

this court. 
Id. at 265–66.
For procedural purposes, we now consider it as a

petition for review of agency action.

                                            II

       TAIT asks us to compel the FAA “to conduct a hearing to formally consider

TAIT’s request for reimbursement under the Grants” — the procedure required by section

47111. Aplt. Br. at 9. TAIT argues that section 47111 applies; that under either section

46110 or section 47111, the FAA did not issue a final order appropriate for judicial

review; and that even if the FAA did issue a final order, its wording created confusion

that caused TAIT’s delay in filing this petition. We disagree.

       First, we conclude that 49 U.S.C. § 46110 governs this action because 49 U.S.C

§ 47111 does not apply. Section 46110 is a general review provision that allows a person

                                            4
to petition for review of an order in which the person has a substantial interest.2 49

U.S.C. § 46110(a). Section 47111 specifically allows a person to petition for review of

an agency’s decision to withhold a payment that is due under a grant agreement.3 49

       2
           Section 46110(a) provides:
               (a) Filing and Venue. — Except for an order related to a
               foreign air carrier subject to disapproval by the President
               under section 41307 or 41509(f) of this title, a person
               disclosing a substantial interest in an order issued by the
               Secretary of Transportation (or the Under Secretary of
               Transportation for Security with respect to security duties and
               powers designated to be carried out by the Under Secretary or
               the Administrator of the Federal Aviation Administration with
               respect to aviation duties and powers designated to be carried
               out by the Administrator) in whole or in part under this part,
               part B, or subsection (l) or (s) of section 114 may apply for
               review of the order by filing a petition for review in the United
               States Court of Appeals for the District of Columbia Circuit or
               in the court of appeals of the United States for the circuit in
               which the person resides or has its principal place of business.
               The petition must be filed not later than 60 days after the order
               is issued. The court may allow the petition to be filed after the
               60th day only if there are reasonable grounds for not filing by
               the 60th day.
       3
           Section 47111(d) provides:
               (d) Withholding Payments. — (1) The Secretary may withhold
               a payment under a grant agreement under this subchapter for
               more than 180 days after the payment is due only if the
               Secretary— (A) notifies the sponsor and provides an
               opportunity for a hearing; and (B) finds that the sponsor has
               violated the agreement. (2) The 180-day period may be
               extended by— (A) agreement of the Secretary and the sponsor;
               or (B) the hearing officer if the officer decides an extension is
               necessary because the sponsor did not follow the schedule the
               officer established. (3) A person adversely affected by an
               order of the Secretary withholding a payment may apply for
               review of the order by filing a petition in the United States
                                                                                (continued...)

                                              5
U.S.C. § 47111(d). This section also sets forth procedures that must be followed before a

payment may be withheld. See 49 U.S.C. § 47111(d)(1).

       Contrary to TAIT’s contention, section 47111 does not apply to a finding that

certain costs are not allowable under a grant agreement. Before the United States may be

obligated to make a payment under a grant agreement, the statutory scheme requires that

the Secretary first decide that the cost is allowable. 49 U.S.C. § 47110. Until such a

determination has been made, no payment can be due. Section 47111 only applies to the

withholding of payments that are “due” under a grant agreement. 49 U.S.C.

§ 47111(d)(1) (emphasis added). A determination that a particular cost is not allowable is

not a withholding of a payment that is due, but merely a determination that no payment

was ever owed. Furthermore, section 47111 applies to situations in which the payment is

withheld due to a violation of the grant agreement. See 49 U.S.C. § 47111(d)(1)(B). In

order to withhold a payment under this section, the Secretary must notify the sponsor,

provide an opportunity for a hearing, and make a finding that the sponsor has violated the

grant agreement. 49 U.S.C. § 47111(d)(1). The FAA made no such finding because there

is no allegation that TAIT violated the grant agreement. The payments were denied

because the costs were not allowable, and not because of an independent violation of the




(...continued)
                 Court of Appeals for the District of Columbia Circuit or in the
                 court of appeals of the United States for the circuit in which
                 the project is located. The petition must be filed not later than
                 60 days after the order is served on the petitioner.

                                              6
grant agreement. Because section 47111 does not apply, TAIT must challenge the FAA’s

action under the general judicial review provision, 49 U.S.C. § 46110.

      Second, we conclude that the December 31, 2012 letter is a final order issued

by the FAA. We have not previously had the opportunity to address what

constitutes an “order” under section 46110, but those circuits that have considered

the meaning of “order” under this section or its predecessor, 49 U.S.C. § 1486,

have concluded that an agency decision is an “order” only if it possesses “the

quintessential feature of agency decisionmaking suitable for judicial review:

finality.” Vill. of Bensenville v. FAA, 
457 F.3d 52
, 68 (D.C. Cir. 2006) (citing

Aerosource, Inc. v. Slater, 
142 F.3d 572
, 577 (3d Cir. 1998) (collecting cases)).

Accordingly, the agency action must “mark the consummation of the agency’s

decisionmaking process,” and “be one by which rights or obligations have been

determined, or from which legal consequences will flow.” Bennett v. Spear, 
520 U.S. 154
, 177–78 (1997) (quotations omitted); see also Vill. of 
Bensenville, 457 F.3d at 68
(applying Bennett in the context of 49 U.S.C. § 46110). In addition,

most circuits require that the alleged order “be predicated on an administrative

record sufficient to allow a court to engage in a meaningful review,” but this

requirement is “not a demanding one.” Burdue v. FAA, 
774 F.3d 1076
, 1080 (6th

Cir. 2014) (collecting cases).

      A communication need not be formal to constitute a final agency action.

Numerous circuits have held that letters from the FAA, including those not issued

                                            7
by the Administrator, constitute “orders” for purposes of 49 U.S.C. § 46110.

Aerosource, 
Inc., 142 F.3d at 577
–78 (collecting cases). Further, under a similar

statute, we have concluded that an informal agency communication may constitute

an order suitable for judicial review. TransAm Trucking, Inc. v. Fed. Motor

Carrier Safety Admin., 
808 F.3d 1205
, 1212 n.4 (10th Cir. 2015) (“[T]he informal

nature of the email communication doesn’t necessarily determine whether it was a

‘final order’ within the meaning of [28 U.S.C.] § 2342(3)(A).”). In addition,

“[t]he mere possibility that an agency might reconsider in light of ‘informal

discussion’ and invited contentions of inaccuracy does not suffice to make an

otherwise final agency action nonfinal.” Sackett v. E.P.A., 
132 S. Ct. 1367
, 1372

(2012).

      The FAA’s December 31, 2012 letter is a final order. The letter marks the

consummation of the FAA’s decisionmaking process. It details TAIT’s prior

requests and the FAA’s responses thereto, including the various requests, reviews,

grants, and denials over the preceding ten years. There is no indication in the

letter or in the record that any additional process on the FAA’s part was to follow.

Although the letter does provide TAIT an opportunity to resubmit any information

the FAA had not yet considered, this invitation does not make an otherwise final

decision nonfinal. Absent additional action from TAIT, the FAA made clear that

it would not reconsider the request. Following the receipt of the December 31,

2012 letter, TAIT took no further action. In addition, the letter determined rights

                                          8
and obligations by concluding that TAIT had no right to reimbursement for the

requested funds and that the FAA had no obligation to pay them. These are legal

consequences sufficient to indicate finality. Further, the administrative record,

which includes nearly 3000 pages of letters, agreements, and payment records

from 2002 through 2012, is sufficient for review. The parties have provided us

with relevant communications between themselves, as well as documentation

supporting TAIT’s claim to reimbursement. Thus, the December 31, 2012 letter

from the FAA is a final order suitable for judicial review under section 46110.

      Third, we conclude that the action was not timely filed. Section 46110 provides

that a petition for review of an agency order generally must be filed not later than

sixty days after the agency order is issued. 49 U.S.C. § 46110(a). A court does

have discretion to allow a petition filed after the sixtieth day if there are

reasonable grounds for the delay. 
Id. Because the
FAA’s letter on December 31,

2012 was a final order, the sixty-day period expired on March 1, 2013. TAIT did

not file its action in the Court of Claims until November 14, 2013 4 — more than

eight months after the statutory period expired. Further, TAIT has not established

any reasonable grounds to justify its delay.




      4
         We consider this petition for review as if it had been filed in this court on
the date on which it was actually filed in the Court of Federal Claims. See 28
U.S.C. § 1631.

                                           9
      Agency-created confusion has been recognized in some circuits as a basis

for finding delay to be reasonable. See, e.g., Safe Extensions, Inc. v. FAA, 
509 F.3d 593
, 603–04 (D.C. Cir. 2007) (excusing delay when the FAA had stated that a

revision was forthcoming but never issued one); Greater Orlando Aviation Auth.

v. FAA, 
939 F.2d 954
, 960 (11th Cir. 1991) (excusing delay when the FAA’s

inconsistent communications caused confusion), abrogated on other grounds by

Henderson v. Shinseki, 
562 U.S. 428
, 438 (2011), as recognized in Corbett v.

TSA, 
767 F.3d 1171
, 1174 (11th Cir. 2014). But we do not have such factual

circumstances here. The D.C. Circuit has twice held this year that ambiguity in a

letter issued by an agency does not excuse delay. See Nat’l Fed’n of the Blind v.

DOT, 
827 F.3d 51
, 57 (D.C. Cir. 2016); Elec. Privacy Info. Ctr. v. FAA, 
821 F.3d 39
, 43 (D.C. Cir. 2016). We agree with the D.C. Circuit that parties should

assume finality in the face of ambiguity and file protectively for judicial review.

See 
id. Thus, if
there was any ambiguity in the December 31, 2012 letter, it does

not excuse TAIT’s delay in filing a petition for review. Moreover, a plain reading

of the December 31, 2012 letter makes clear that the FAA’s determination was

final and no reimbursements would be issued unless TAIT took further action,

either by resubmitting documentation in the format recommended by the FAA, or

by appealing to this court within sixty days. TAIT did neither.

                                         III

      The petition for review of agency action is DISMISSED as not timely filed.

                                          10

Source:  CourtListener

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