GERBER PRODUCTS COMPANY v. VILSACK et al
MEMORANDUM OPINION re: 25 Defendants' Motion to Dismiss and 28 Plaintiff's Motion for Leave to Take Discovery and File a Second Amended Complaint. Signed by Judge Amit P. Mehta on 05/30/2017. (lcapm3)
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
SONNY PERDUE, et al.,
GERBER PRODUCTS COMPANY,
Case No. 16-cv-01696
This lawsuit arises out of a disputed contract to supply infant formula in the
Commonwealth of Virginia under the federal Special Supplemental Nutrition Program for
Women, Infants, and Children (“WIC”).
Overseen by the U.S. Department of Agriculture
(“USDA”), the WIC program provides grants to state agencies to fund food benefits and other
related services to low-income women and children.
In the spring of 2016, the Virginia
Department of Health (“VDH”) issued a notice of Intent to Award a contract for the supply of
infant formula to Plaintiff Gerber Products Company. Plaintiff’s competitor, Abbott Nutrition,
challenged that preliminary award, claiming that VDH had evaluated the competing bids using the
wrong data. VDH consulted with USDA officials, who agreed that state officials had relied on
incomplete data when initially awarding the contract to Plaintiff. VDH then re-opened the bid
process and ultimately awarded the contract to Abbott Nutrition.
Plaintiff believes it lost the Virginia infant formula contract because of the USDA’s
actions. Plaintiff claims that the USDA gave advice to VDH that was at odds with the agency’s
positions in other state procurements and directed VDH to rescind the Intent to Award and re-open
the bid process. Plaintiff now brings suit to prevent such events from happening again. Plaintiff
asks the court to issue an order requiring the USDA “to clarify and consistently apply guidance on
required data to be included in State WIC solicitations” and “to cease providing inconsistent or
disparate direction or advice regarding data requirements for State WIC infant formula
procurements.” Although Plaintiff paints a sympathetic picture, the court cannot grant the relief it
seeks. As explained below, Plaintiff both lacks standing to bring suit and fails to challenge a final
agency action under the Administrative Procedure Act. For those reasons, the court grants
Defendants’ Motion to Dismiss. The court also denies Plaintiff’s request for leave to take
The U.S. Department of Agriculture (“USDA”), through its sub-component, the Food and
Nutrition Service, runs the Special Supplemental Nutrition Program for Women, Infants, and
Children (“WIC”). Am. Compl., ECF No. 24 [hereinafter Am. Compl.], ¶ 29. WIC is funded by
the USDA but is administered by state agencies. Id. ¶¶ 29–30. Under the program, the federal
government provides grants to states, which in turn provide “supplemental foods and nutrition
education” to qualifying low-income women and children. Child Nutrition Act, 42 U.S.C. § 1786;
Am. Compl. ¶¶ 29–30.
One of the products the WIC program provides is infant formula.
See 42 U.S.C.
§ 1786(f)(15). Under the statutory scheme, states are required to administer a competitive bidding
process, or similar cost containment system, in which companies bid to secure exclusive contract
rights to provide infant formula to that state. Id. § 1786(h)(8)(A)(i). The USDA’s regulations,
generally speaking, require states to use a “single-supplier competitive system,” whereby state
WIC agencies “solicit sealed bids from infant formula manufacturers to supply and provide a
rebate for infant formulas.” 7 C.F.R. § 246.16a(b)(1) (2011). The prevailing manufacturer gives
the state agency a rebate for each unit of formula purchased by WIC participants in exchange for
an exclusive supplier contract. 42 U.S.C. § 1786(b)(17), (18).
In the spring of 2016, the Commonwealth of Virginia’s WIC agency, the Virginia
Department of Health (“VDH”), announced an Intent to Award its WIC infant formula contract to
Plaintiff. Am. Compl. ¶ 41. Plaintiff’s competitor, Abbott Nutrition, challenged VDH’s decision,
arguing that VDH had used incorrect data to determine the lowest bidder. Id. ¶ 44. According to
Abbott Nutrition, VDH incorrectly used estimates of infants consuming only milk-based formula,
when it should have included infants using soy-based and milk-based lactose free infant formula.
Virginia WIC Director Michael Welch sought guidance from the USDA following Abbott
Nutrition’s protest. Welch e-mailed a group of USDA officials to ask whether the USDA’s
regulations required state agencies to consider all participating infants in evaluating bids, or just
those using milk-based formula. Id. ¶¶ 47–49. The Food and Nutrition Service’s WIC branch
chief for the Mid-Atlantic Region, Jaime Van Lieu, informed Welch that the USDA’s regulations
required, for bidding purposes, an estimate of all participating infants, except those who are
breastfeeding or prescribed exempt formulas. Id. ¶ 49; Compl., ECF No. 1 [hereinafter Compl.],
Ex. 1, ECF No. 1-9 [hereinafter Pl.’s Ex. 1], at 7–9. Van Lieu admitted the regulations were
ambiguous, but pointed to preambles to the relevant rules to support her conclusion, noting that
“USDA’s legal folks typically reference preambles when there is vagueness in the regs.” Pl.’s Ex.
1 at 9. Van Lieu also reported that a recent winning bid from another state in her region,
Pennsylvania, included all non-exempt infants that receive formula. Id. Following this exchange,
VDH canceled its Intent to Award the contract to Plaintiff “due to missing data,” reopened bidding,
and thereafter awarded the contract to Abbott Nutrition. Am. Compl. ¶¶ 51, 53, 88–89.
Plaintiff challenged VDH’s revocation of its Intent to Award at every turn. At the start,
Plaintiff sent a letter to VDH protesting the revocation and sent a copy to the USDA. Am. Compl.
¶¶ 54–55, 61. The USDA deferred to VDH, and VDH, in turn, rejected the protest on the ground
that Plaintiff could not challenge VDH’s decision not to award a contract. Compl., Ex. 8, ECF
No. 1-16; Am. Compl. ¶¶ 67–68. Plaintiff’s subsequent administrative protests also proved
unsuccessful. Compl., Ex. 11, ECF No. 1-19; Am. Compl. ¶¶ 75, 90. Plaintiff also twice sued
VDH in Virginia state court—first, after VDH announced the re-bid, and then again after it
awarded the contract to Abbott Nutrition—only to see VDH prevail in both cases. Am. Compl.
¶¶ 84, 93–94.
In September 2016, Plaintiff brought suit in this court against both federal and VDH
officials, seeking a temporary restraining order (“TRO”) enjoining VDH officials from announcing
a new bid solicitation and requiring them to re-instate the original Intent to Award to Plaintiff.
This court denied the motion for a TRO, finding that it lacked both personal jurisdiction over the
Virginia state officials and subject matter jurisdiction to hear the claims against them. Gerber
Prod. Co. v. Vilsack, No. 16-1696, 2016 WL 4734357, at *1 (D.D.C. Sept. 9, 2016). The court
also held that, because it could not order the federal officials to grant the requested injunctive
relief, Plaintiff lacked standing to sue them. Id.
Having failed to recapture the Virginia contract, Plaintiff embarked on a different strategy.
It voluntarily dismissed the Virginia state officials from this suit, see Notice of Voluntary
Dismissal, ECF No. 21, and then filed an Amended Complaint solely against USDA officials
(“Defendants”). 1 The Amended Complaint alleges that the USDA violated the Administrative
Procedure Act (“APA”) (1) by treating the Virginia procurement differently than similarly situated
state procurements, and (2) by violating its own regulations when it directed VDH to re-open
bidding. Am. Compl. ¶¶ 109–23. As to its first APA claim, Plaintiff alleges that the USDA has
not acted consistently when it comes to intervening in various states’ infant formula procurements.
Id. ¶¶ 109–13. Plaintiff points to a host of other instances in which state agencies awarded
contracts based on the same purportedly deficient data that Plaintiff submitted to VDH, without
any corresponding demand from the USDA to re-open bidding. Id. ¶¶ 95–102. As to its second
APA claim, Plaintiff contends that the USDA violated its own regulations when it “usurped the
role of the VDH procurement officer and improperly directed cancellation” of the Intent to Award.
Id. ¶ 118. To remedy these alleged violations, Plaintiff asks the court to order the USDA “to clarify
and consistently apply guidance on required data to be included in State WIC solicitations” and
“to cease providing inconsistent or disparate direction or advice regarding data requirements for
State WIC infant formula procurements.” Id. at 31.
Defendants move to dismiss Plaintiff’s Amended Complaint on several grounds. First,
under Rule 12(b)(1) of the Federal Rules of Civil Procedure, they contend that the court is without
subject matter jurisdiction to hear Plaintiff’s claims because Plaintiff lacks Article III standing.
Defs.’ Mot. to Dismiss, ECF No. 25, Mem. in Supp., ECF No. 25-1 [hereinafter Defs.’ Mot.], at
9–18. Second, under Rule 12(b)(6), Defendants argue that Plaintiff has not met the threshold
requirement for challenging agency action under the APA because the action Plaintiff seeks to
Pursuant to Rule 25(d) of the Federal Rules of Civil Procedure, the court substitutes as defendants Sonny Perdue, in
his official capacity as Secretary of Agriculture, for former Secretary of Agriculture, Tom Vilsack; and Jessica Shahin,
in her official capacity as Acting Administrator of the USDA’s FNS, for former FNS Administrator, Audrey Rowe.
challenge is neither “agency action,” under 5 U.S.C. § 702, nor “final,” under 5 U.S.C. § 704.
Defs.’ Mot. at 8, 19–26. Third, also under Rule 12(b)(6), Defendants argue that Plaintiff fails to
state a claim under the APA because (1) the regulation the USDA allegedly violated is an
indemnity provision and does not impose any liability or duty on the USDA; and (2) Plaintiff did
not sufficiently plead facts showing that the USDA treated similar state procurements differently.
Id. at 26–36.
Dismissal for Lack of Subject Matter Jurisdiction Under Rule 12(b)(1)
When deciding a motion to dismiss for lack of subject matter jurisdiction under Rule
12(b)(1), a court must accept all well-pleaded factual allegations in the complaint as true. Jerome
Stevens Pharm., Inc. v. Food & Drug Admin, 402 F.3d 1249, 1253–54 (D.C. Cir. 2005). “The
plaintiff bears the burden of invoking the court’s subject matter jurisdiction.” Arpaio v. Obama,
797 F.3d 11, 19 (D.C. Cir. 2015).
When ruling on a Rule 12(b)(1) motion in which the defendant challenges the plaintiff’s
standing to assert a claim, a federal court must presume that it “lack[s] jurisdiction unless the
contrary appears affirmatively from the record.” DaimlerChrysler Corp. v. Cuno, 547 U.S. 332,
342 n.3 (2006) (quoting Renne v. Geary, 501 U.S. 312, 316 (1991)). The burden of establishing
the elements of standing “rests upon the party asserting jurisdiction.” Kokkonen v. Guardian Life
Ins. Co. of Am., 511 U.S. 375, 377 (1994); see Lujan v. Defenders of Wildlife, 504 U.S. 555, 561
(1992). A plaintiff must establish standing “for each claim he seeks to press and for each form of
relief that is sought.” Davis v. Fed. Election Comm’n, 554 U.S. 724, 734 (2008) (internal quotation
Dismissal for Failure to State a Claim Under Rule 12(b)(6)
Motions to dismiss under Rule 12(b)(6) test the legal sufficiency of a complaint. Browning
v. Clinton, 292 F.3d 235, 242 (D.C. Cir. 2002).
To survive a motion to dismiss, a complaint must contain sufficient
factual matter, accepted as true, to “state a claim to relief that is
plausible on its face.” A claim has facial plausibility when the
plaintiff pleads factual content that allows the court to draw the
reasonable inference that the defendant is liable for the misconduct
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citation omitted) (quoting Bell Atl. Corp. v. Twombly,
550 U.S. 544, 570 (2007)).
When assessing a motion to dismiss under Rule 12(b)(6), the court must accept the
plaintiff’s well-pleaded factual allegations as true and draw all reasonable inferences from those
allegations in the plaintiff’s favor. Id.; Arpaio, 797 F.3d at 19. The court is not required, however,
to assume the truth of legal conclusions or accept inferences that are not supported by the facts set
out in the complaint. Iqbal, 556 U.S. at 678; Islamic Am. Relief Agency v. Gonzales, 477 F.3d 728,
732 (D.C. Cir. 2007). “Threadbare recitals of the elements of a cause of action, supported by mere
conclusory statements, do not suffice.” Iqbal, 556 U.S. at 678. If a complaint lacks sufficient facts
to “state a claim to relief that is plausible on its face,” then the court must dismiss it. Id. (quoting
Twombly, 550 U.S. at 570); see also Arpaio, 797 F.3d at 19.
The court begins, as it must, with whether Plaintiff has standing. A plaintiff has standing
when she has “(1) suffered an injury in fact, (2) that is fairly traceable to the challenged conduct
of the defendant, and (3) that is likely to be redressed by a favorable judicial decision.” Spokeo,
Inc. v. Robins, 578 U.S. ___, ___, 136 S. Ct. 1540, 1547 (2016) (citing Lujan, 504 U.S. at 560–
61). Because Plaintiff has not met its burden of establishing the first element of injury in fact, the
court need not address the other two.
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.” Lujan, 504 U.S. at
560 (footnote, citations, and internal quotation marks omitted). When, as here, a plaintiff seeks
declaratory or injunctive relief, the plaintiff’s burden in establishing injury is “significantly more
rigorous.” Swanson Grp. Mfg. LLC v. Jewell, 790 F.3d 235, 240 (D.C. Cir. 2015); Dearth v.
Holder, 641 F.3d 499, 501 (D.C. Cir. 2011). Plaintiff “must show he is suffering an ongoing injury
or faces an immediate threat of injury.” Dearth, 641 F.3d at 501 (emphasis added). A potential
future injury must be “certainly impending”; the mere possibility of such injury is not enough.
Clapper v. Amnesty Int’l USA, 568 U.S. 398, ___ , 133 S. Ct. 1138, 1147 (2013).
Plaintiff claims both ongoing and future injuries. Plaintiff alleges ongoing injury in the
form of “great uncertainty and [an] un-level playing field” arising from the USDA’s inconsistent
approach to advising state WIC officials and intervening in state bid processes. Am. Compl. ¶ 103;
see also Pl.’s Opp’n to Defs.’ Mot. to Dismiss, ECF No. 27, at 15 (“[Plaintiff] is unable to predict
how future [state] procurements will be conducted”); Oral Arg. Tr. (rough draft) [hereinafter Tr.]
at 34 (describing injury as “a combination of the confusion, the expense, and then the inconsistent
direction from USDA”). Plaintiff also contends that it faces an immediate threat of two, related
future injuries. First, Plaintiff asserts that it may lose future bids as a result of the USDA’s
“improper and inconsistent” interference with state-level procurement processes. Pl.’s Opp’n
at 18; Tr. at 34–36. Second, Plaintiff alleges that it “will be forced to file state-level protests in
each State WIC procurement until USDA complies with and consistently interprets its own
regulations.” Am. Compl. ¶ 108. None of these alleged injuries satisfies the injury-in-fact
Plaintiff’s claimed ongoing injuries—“great uncertainty” as to future state procurements
and “an un-level playing field”—do not support Article III standing. Business uncertainties that
arise from regulatory decisions are not the kind of concrete and particularized injuries sufficient
to establish an injury in fact.
As Judge Huvelle put it in ViroPharma, Inc. v. Hamburg:
“[U]ncertainties regarding the future regulatory and competitive environment . . . . are highly
nebulous in both character and degree,” and for that reason cannot satisfy the injury-in-fact
requirement. 777 F. Supp. 2d 140, 147 (D.D.C. 2011) (internal quotation marks omitted), aff’d,
471 F. App’x 1 (D.C. Cir. 2012); see also Mylan Pharm. Inc. v. U.S. Food & Drug Admin., 789
F. Supp. 2d 1, 10 (D.D.C. 2011) (holding that alleged harm from agency inaction that impacted
immediate business decisions was insufficient to establish standing).
Moreover, Plaintiff’s claimed confusion about data requirements is, in a sense, of its own
making. If a plaintiff can easily remedy such purported harm by seeking clarification from an
agency, but has not done so, then the plaintiff cannot claim to suffer from an injury in fact for
purposes of standing. See Nat’l Family Planning & Reprod. Health Ass’n, Inc. v. Gonzales, 468
F.3d 826, 831 (D.C. Cir. 2006). Here, there is an easy solution to “alleviat[e] the alleged
uncertainty.” Id. Plaintiff can simply ask the USDA: What information must be included in bids
for infant formula contracts under the WIC program? See id. (holding the plaintiff lacked standing
where “[i]t could inquire of [the agency] exactly how the agency proposes to resolve any of the
conflicts that it claims to spot between the amendment and the regulations,” but did not do so).
Plaintiff has neither directly posed that question to the USDA nor formally petitioned the agency
pursuant to 5 U.S.C. § 553(e) for a rule clarifying the bidding requirements. 2 As Plaintiff has
“chosen to remain in the lurch, it cannot demonstrate an injury sufficient to confer standing.” Id. 3
Plaintiff heavily relies upon National Law Party of the United States v. Federal Election
Commission to support its claim that it suffers from ongoing injury. See Pl.’s Opp’n at 15–16
(citing and discussing 111 F. Supp. 2d 33 (D.D.C. 2000)). That reliance is misplaced. In National
Law Party, the plaintiffs, a minor political party and its candidates who were excluded from
participating in the 1996 presidential and vice-presidential debates, sought review of the Federal
Election Commission’s decision to dismiss its administrative complaint challenging the criteria by
which the Committee on Presidential Debates selects participants. 111 F. Supp. 2d at 36. Even
though the election at issue had long since passed, the court held that plaintiffs still had standing
because they suffered “continuing adverse effects” from the agency’s action, because the plaintiffs
would be unable “to compete on an equal footing” with the major political parties in future national
elections. Id. at 43–44. No similar ongoing injury exists here. The USDA’s past inconsistencies,
even if true, do not foretell its future conduct. And, even if the USDA continues to act in a
haphazard fashion, there is no reason to believe that its actions will affect a future state-level award
or work to Plaintiff’s detriment. In other words, unlike in the case of repeated application of
selection criteria, the court has little reason to believe that the factual circumstances that led to the
Plaintiff did send a letter to the USDA in April 2016 concerning the Virginia 2016 bid process, but the letter did not
ask the USDA to explain what data must be included when bidding for state WIC procurements of infant formula.
Compl., Ex. 6, ECF No. 1-14 [hereinafter Pl.’s Ex. 6]. Rather, in somewhat alarmist fashion, Plaintiff demanded that
the USDA stay all state procurements “given the substantial uncertainty arising from” the Virginia 2016 contract
award. Id. at 2. The letter does not ask the USDA to clarify regulatory requirements, nor does it constitute a formal
request under 5 U.S.C. § 553(e).
At oral argument, Plaintiff’s counsel represented that Plaintiff has asked various states about what data is required
in bids and has received inconsistent answers. Tr. at 31, 33. Even if that is so, it is hard to see how Plaintiff is injured
by inconsistencies across states when what matters for securing the state contract is how the program operates in each
USDA’s actions in the Virginia procurement will be repeated and, even if they are, it would be
entirely speculative for the court to conclude that Plaintiff will be harmed as a result.
Plaintiff’s claims of future injury fare no better as they, too, are wholly speculative. The
following chain of events would have to occur before the agency’s actions could be causally
connected to Plaintiff’s claimed future injuries of lost WIC infant formula contracts and associated
costs: (1) Plaintiff is unable to determine in advance the proper data requirements for a state WIC
infant formula procurement; (2) Plaintiff’s competitor submits the proper data, either on its own
or after the USDA intervenes; (3) Plaintiff’s bid is rendered less competitive due to either the
USDA’s intervention as to a competitor’s bid or inconsistent positions given to Plaintiff about data
requirements; (4) Plaintiff loses the contract; (5) Plaintiff’s loss is due to the uncertainty over data
requirements or the USDA’s intervention, and not for some other valid reason; and (6) Plaintiff
does not prevail in a bid protest or on a rebid. Several of these steps are not only uncertain, but
also entirely speculative. Uncertainty and speculation cannot hold together “the chain to connect
the challenged acts to the asserted particularized injury.” Florida Audubon Soc. v. Bentsen, 94
F.3d 658, 670 (D.C. Cir. 1996). Those links are rendered even more attenuated because they
depend on the actions of a third party—the state WIC agency—that has primary control over the
procurement process. See Cierco v. Mnuchin, No. 16-5185, 2017 WL 2231107, at *9 (D.C. Cir.
May 23, 2017) (“We are particularly disinclined to endorse standing theories that rest on
speculation about the decisions of independent actors.” (internal quotation marks omitted)); see
also Arpaio, 797 F.3d at 21 (“When considering any chain of allegations for standing purposes,
we may reject as overly speculative those links which are predictions of future events (especially
future actions to be taken by third parties) . . . .”). Plaintiff, therefore, falls short of demonstrating
a future injury that is “certainly impending.” See Clapper, 133 S. Ct. at 1147.
As before, Plaintiff relies heavily on a single case—this time, Dearth v. Holder—to
establish future injury, but that case offers no help. See Pl.’s Opp’n at 16–17 (citing and discussing
641 F.3d 499 (D.C. Cir. 2011)). In Dearth, the plaintiff challenged a statute and regulations that
prohibited anyone living outside the United States from purchasing a firearm in the United States.
641 F.3d at 500. The D.C. Circuit held that the plaintiff, a U.S. citizen living in Canada who twice
had attempted to buy a firearm in the United States but was denied, demonstrated imminent future
injury by declaring his intent to both return to the United States to visit family and friends and to
purchase a firearm, which he would store with his family. See id. at 502–03. The difference
between Dearth and this case is obvious: the former involves a “certainly impending” injury while
the facts presented here do not. The future injury in Dearth was certain to occur because the
challenged law would undeniably prevent the plaintiff from purchasing a firearm the next time he
traveled to the United States, whereas here the claimed injury depends on too many variables,
including the unknowable actions of the state WIC agencies. Accordingly, Plaintiff lacks standing
based on claimed imminent future injury. 4
Whether Agency Action is Reviewable Under the APA
Plaintiff’s suit fails for another reason—it does not allege a reviewable “final agency
action.” 5 For an agency action to be “final,” and therefore reviewable under the APA, it must
(1) “mark the consummation of the agency’s decisionmaking process”—in other words, it cannot
be “tentative or interlocutory”—and (2) determine “rights or obligations” or have “legal
Plaintiff also argues that even if it did not allege sufficient injury, Plaintiff has standing because the USDA’s conduct
is “capable of repetition, yet evading review.” Pl.’s Opp’n at 18–19 (quoting Kingdomware Techns., Inc. v. United
States, 579 U.S. ___, ___, 136 S. Ct. 1969, 1976 (2016)). However, the doctrine Plaintiff invokes is designed to help
a party avoid dismissal for mootness when it had standing at the time the complaint was filed but circumstances have
changed and relief is no longer available. See Cierco, 2017 WL 2231107, at *5. That is not the case here.
Defendants also argue that Plaintiff has not alleged an “agency action,” let alone a “final agency action.” Defs.’
Mot. at 19–22. Because the court finds that the requirement of finality is clearly absent, it need not decide whether
the challenged conduct meets the definition of “agency action” under the APA.
consequences.” Bennett v. Spear, 520 U.S. 154, 177–78 (1997) (internal quotation marks omitted).
The APA does not allow for review of “generalized complaints about agency behavior.” Cobell
v. Kempthorne, 455 F.3d 301, 307 (D.C. Cir. 2006).
Plaintiff challenges two claimed “final” agency actions. The first is the USDA’s alleged
provision of inconsistent direction concerning bid data to state WIC programs. See Pl.’s Opp’n at
26 (challenging “USDA’s disparate direction to State WIC agencies regarding the data to be
included on bid sheets in specific procurements, and USDA specific and discrete direction to state
WIC agencies to cancel or award WIC contracts in violation of its own regulations” (citing Am.
Compl. ¶¶ 2, 95–108)). The second is the USDA’s “improper interfer[ence]” in state WIC
contract awards. Id. at 28 (“USDA is improperly interfering in State WIC procurements and is
inconsistently and improperly insisting on the inclusion of certain data in some procurements but
not in others.”).
The USDA’s provision of “disparate direction” to various states does not constitute final,
reviewable agency action. Plaintiff points to six states that have awarded WIC infant formula
contracts, without USDA-mandated re-bidding, even though the winner’s bid lacked the same type
of data as Plaintiff’s failed Virginia bid. Am. Compl. ¶¶ 96–101. Plaintiff argues that the USDA’s
decision not to require those states to re-open bidding on their procurements, when combined with
the agency’s contrary directive to do so in Virginia, constitutes final agency action. Id. That just
is not so. Plaintiff cannot point to a series of state agency actions—the WIC procurements—with
no obvious connection to federal action, and declare the USDA’s decision not to act in those
instances to be “final [federal] agency action” within the meaning of the APA. The only common
thread alleged among the state procurements (including Virginia) is general oversight by the
USDA. Nowhere does Plaintiff allege that there was any confusion in any of the other six state
procurements about bidding data requirements. Nor does Plaintiff allege any communication
about data requirements between the USDA and any of the six state agencies. Plaintiff’s effort to
transform federal inaction in factually dissimilar situations into final agency action here fails.
Moreover, the notion that giving inconsistent direction to state agencies is the
“consummation” of the USDA’s decision-making process is implausible. It is far more plausible
that any difference in advice is due to diffuse administration of the WIC program at the regional
level by lower-ranking officers. See Tr. at 14–15 (explaining that the USDA administers the WIC
program through the regional offices of its sub-component, the Food and Nutrition Service). That
is what happened in the case of the Virginia bid. The WIC branch chief for the Mid-Atlantic
region, Jaime Van Lieu, 6 conveyed via e-mail her personal interpretation of relevant regulations
to Virginia officials. See Pl.’s Ex. 1 at 7–9 (stating that “[i]t is my understanding” that “USDA’s
legal folks” will rely on the preamble to a rule to interpret vagueness in a regulation). Guidance
supplied by a lower-level official generally does not qualify as a “final” agency action, even if it
See Franklin v. Massachusetts, 505 U.S. 788, 797 (1992); Anglers
Conservation Network v. Pritzker, 809 F.3d 664, 669–70 (D.C. Cir. 2016). Thus, the fact
that VDH officials accepted Van Lieu’s interpretation and Plaintiff lost a contract as a result does
not convert the e-mail into a final agency action.
The second supposed final agency action—the USDA’s improper interference in state WIC
awards—suffers from the exact same flaws as the first. At most, any action by USDA officials
appears to reflect diffuse decision-making among subordinate actors, rather than the formal
consummation of an agency’s decision-making process.
Defendants’ counsel represented at oral argument that Van Lieu reports to the regional WIC director, who reports to
the regional administrator, who reports to the Food and Nutrition Service’s headquarters in Washington, D.C. Tr. at
Finally, neither of the challenged actions determines legal rights or obligations. Courts
“lack authority to review claims where an agency merely expresses its view of what the law
requires of a party, even if that view is adverse to the party.” Indep. Equip. Dealers Ass’n v. EPA,
372 F.3d 420, 427 (D.C. Cir. 2004). That is all that occurred here. A subordinate official at the
USDA expressed her view on what the agency’s regulations require, and VDH accepted that view.
That advice did not determine legal rights or obligations for any party, including Plaintiff.
Accordingly, because Plaintiff has not alleged a final agency action, it has failed to state a claim
under the APA. 7
Plaintiff’s Motion for Discovery
Plaintiff seeks “jurisdictional” discovery and a second opportunity to amend its complaint.
Pl.’s Opp’n at 39–40; Pl.’s Reply to Defs.’ Opp’n to Pl.’s Alternative Mot. for Leave to Take
Discovery and File a Second Am. Compl., ECF No. 31 [hereinafter Pl.’s Reply], at 5. To the
extent Plaintiff seeks jurisdictional discovery to show that the USDA’s actions are final agency
action—see Pl.’s Reply at 12–13; Tr. at 29, 39–40—that request is improper because finality is
not a “jurisdictional” element of an APA claim. Pl.’s Reply at 12–13; see Trudeau v. FTC, 456
F.3d 178, 184 (D.C. Cir. 2006). Additionally, to the extent Plaintiff requests jurisdictional
discovery to establish standing, its request also fails because no amount of discovery will cure
Plaintiff’s lack of injury. Cf. Mwani v. bin Laden, 417 F.3d 1, 17 (D.C. Cir. 2005). The court
therefore denies Plaintiff’s request for discovery.
Because the court finds that Plaintiff has failed to satisfy the “threshold” showing of a “final agency action,” it need
not address the merits of Defendants’ remaining arguments for dismissal under Rule 12(b)(6).
For the foregoing reasons, the court grants Defendants’ Motion to Dismiss and denies
Plaintiff’s Motion for Leave to Take Discovery and File a Second Amended Complaint. A separate
Order accompanies this Memorandum Opinion.
Dated: May 30, 2017
Amit P. Mehta
United States District Judge
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