TERRY v. USA
Filing
74
PUBLISHED OPINION DISMISSING for lack of jurisdiction plaintiff's discrimination and promissory estoppel claims, and GRANTING IN PART and DENYING IN PART AS MOOT 68 Defendant's Motion to Dismiss for Failure to State a Claim Upon Which Rel ief Can Be Granted. The Clerk is directed to dismiss without prejudice plaintiff's discrimination and promissory estoppel claims, dismiss with prejudice plaintiff's remaining allegations, and enter judgment accordingly. No costs. Signed by Judge Margaret M. Sweeney. (rac)
In the United States Court of Federal Claims
No. 09-454 C
(Filed: March 6, 2012)
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JOYCE TERRY,
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d/b/a SHIRT SHACK,
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Plaintiff,
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v.
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THE UNITED STATES,
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Defendant.
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Motion to Dismiss, RCFC 12(b)(6);
Exhibits Appended to Prior Pleading;
Materials Integral to Claim; Incorporation
By Reference; Solicitation Is a Public
Record; Avtel Services, Inc.; Implied
Contract to Consider Proposal Fairly and
Honestly; Allegations of Bad Faith; Court
Need Not Accept As True Allegations
Concerning Effect of Exhibit; Alleged
Breach of Express Contract; Lack of Subject
Matter Jurisdiction Over Discrimination and
Promissory Estoppel Claims; Existence
of Express Contract Precludes Impliedin-Fact Contract Claim Dealing With
Same Subject Matter As Express Contract
Bonnie Michelle Smith, Warner Robins, GA, for plaintiff.
Arlene Pianco Groner, United States Department of Justice, Washington, DC, for defendant.
OPINION AND ORDER
SWEENEY, Judge
Before the court is defendant’s motion to dismiss plaintiff’s second amended complaint
(“motion to dismiss”). Plaintiff Joyce Terry, doing business as Shirt Shack, alleges that the
Army and Air Force Exchange Service (“AAFES”) breached an implied-in-fact contract to
consider honestly and fairly a proposal she submitted in response to a solicitation for the
operation of a concession business at Fort Benning in Columbus, Georgia. Plaintiff also alleges
that the AAFES acted in bad faith during its administration of, as well as breached, a separate,
short-term commodity concession agreement executed by the parties in 2009 (“concession
contract”). Defendant moves to dismiss the second amended complaint pursuant to Rule
12(b)(6) of the Rules of the United States Court of Federal Claims (“RCFC”), arguing that
plaintiff fails to allege sufficient facts showing that the AAFES breached (1) an implied-in-fact
contract to consider plaintiff’s proposal honestly and fairly, and (2) the concession contract. The
court deems oral argument unnecessary. For the reasons set forth below, the court sua sponte
dismisses those claims over which it lacks jurisdiction and grants in part and denies in part as
moot defendant’s motion to dismiss.
I. BACKGROUND1
A. Solicitation for a Concession Operation at Fort Benning
On October 6, 2008, the AAFES issued a solicitation for the operation of a concession
business at Fort Benning. Second Am. Compl. ¶ 5; AR 33. Kay Dunbar served as the
contracting officer. AR 33. The solicitation advised prospective offerors that Ms. Dunbar “may
require offerors to submit confidential data [that] include[d] a projected operating statement
using estimated sales shown in this solicitation” that she could utilize to evaluate each offeror’s
responsibility. Id. at 71. The solicitation also required each offeror to
have adequate resources to perform the resulting contract and, upon request,
furnish proof of same to the contracting officer. The contracting officer may
request a financial statement, a cost breakdown, a projected operating statement,
or other data from any offeror. Failure to furnish the data requested within the
time specified may cause a firm to be determined nonresponsible. AAFES further
reserve[d] the right to determine the responsibility of the offerors based on factors
including but not limited to the offeror’s financial resources, business capacity,
1
The facts set forth in Parts I.A-B and I.D are derived from: the second amended
complaint (“Second Am. Compl.”); exhibits appended to plaintiff’s prior pleading, which are
referred to and identified in the second amended complaint, as well as an additional exhibit
appended to the second amended complaint (“Pl.’s Ex.”); an exhibit appended to defendant’s
motion containing plaintiff’s concession contract, which is referred to in the second amended
complaint (“Def.’s Ex.”); and Solicitation No. SDVC 07-025-08-373 for a concession operation
at Fort Benning, which is referred to throughout the second amended complaint and is part of the
administrative record (“AR”) in this case. Although an amended complaint normally supersedes
a prior complaint, Pac. Bell Tel. Co. v. Linkline Commc’ns, Inc., 555 U.S. 438, 456 n.4 (2009),
plaintiff appended only one exhibit, “Exhibit 7,” to her second amended complaint. The
remaining six exhibits referenced in the second amended complaint were attached to plaintiff’s
prior pleading. The court construes pleadings “so as to do justice,” RCFC 8(e), and therefore
treats the six exhibits appended to the amended complaint as if they had been appended to the
second amended complaint.
Furthermore, a party pleading a claim founded on a contract “must identify the
substantive provisions of the contract . . . on which the party relies. In lieu of a description, the
party may annex to the complaint a copy of the contract . . . , indicating the relevant provisions.”
RCFC 9(k). In W & D Ships Deck Works, Inc. v. United States, the court deemed the
solicitation at issue in a bid protest incorporated within the pleadings for purposes of RCFC
12(b) because it was within the category of documents contemplated by a former version of
RCFC 9(k). 39 Fed. Cl. 638, 647 n.7 (1997). Accordingly, the court considers the solicitation
and concession contract as if plaintiff annexed them to her second amended complaint. See infra
Parts II, III.A.
2
performance record, integrity, management/business acumen, technical ability and
facilities/equipment.
Id. at 35. The AAFES intended to award a contract “to the responsive, responsible offeror whose
proposal [wa]s best for AAFES, price/fee and other factors set out in the solicitation considered”
and reserved the right to accept other than the lowest proposal and issue multiple awards . . . .”
Id. at 36.
Exhibit C of the solicitation, titled “Special Provisions,” set forth terms governing
equipment, furniture, and movable trade fixtures furnished by both the AAFES and the
concessionaire, i.e., the contract awardee.2 Id. at 55. Title to concessionaire-furnished
equipment, furniture, and fixtures remained with the concessionaire. Id. The solicitation
permitted the concessionaire to utilize leased equipment during contract performance so long as
Ms. Dunbar was furnished the lessor’s name and address. Id. Offerors were further advised that
[c]oncessionaire investment in equipment, furniture and fixtures for this contract
is a business risk of the concessionaire. It is expressly understood and agreed that
neither AAFES nor any other agency or instrumentality of the United States is or
will be liable to concessionaire for costs of concessionaire’s investing in
equipment, furniture or movable trade fixtures in the event of termination of this
contract without extension.
Id.
Exhibit G, titled “Concessionaire Furnished Equipment,” set forth the type and quantity
of equipment required for conducting business at two separate concessionaire locations. Id. at
73. For business in the main exchange building, the concessionaire needed a heat transfer press
and transfer machine, which had to “be new or in ‘like new’ condition . . . .” Id. The heat
transfer press had to be “[c]apable of transferring rubber based and sublistatic ink transfers. Insta
Model 515 or equivalent.” Id. The transfer machine had to be “[c]apable of transferring decals
to caps/hats. Insta Model 412 or equivalent.” Id. The solicitation required that “[h]eat pressed
items . . . be offered on a while-you-wait-basis.” Id. at 75.
Plaintiff submitted a proposal for a five-year contract with a thirty percent fee payable to
the AAFES based upon her total adjusted gross sales. Pl.’s Ex. 1 at 1. Once all proposals were
received, Ms. Dunbar requested a best and final fee offer from each offeror. Pl.’s Ex. 6 at 1. In
response to Ms. Dunbar’s request, plaintiff increased her proposed fee from thirty to thirty-seven
percent. Pl.’s Ex. 2 at 1; cf. Second Am. Compl. ¶ 12 (alleging that plaintiff “was asked to
submit a new bid”). After receiving all best and final fee offers, Ms. Dunbar expressed concern
that two offerors proposed unreasonably high fees. Pl.’s Ex. 6 at 1. She then requested that the
2
Exhibit G of the solicitation set forth requirements for concessionaire-furnished
equipment, and Exhibit I enumerated equipment furnished by the AAFES. AR 73-74, 78.
3
offerors submit a Monthly Projected Operating Statement (“MPOS”) so that she could determine
whether the offerors could operate their businesses at their proposed fees. Id. In response to Ms.
Dunbar’s request, plaintiff submitted a revised best and final fee offer in which she reduced her
proposed fee from thirty-seven to twenty-seven percent. Pl.’s Ex. 3; accord Second Am. Compl.
¶ 13. Ms. Dunbar reviewed each offeror’s MPOS and determined that all proposed fees were
reasonable. Pl.’s Ex. 6 at 1. She then awarded a contract to The Shirt House, which proposed
the highest fee–27.25 percent. Id.; accord Second Am. Compl. ¶ 8.
Plaintiff protested the award to The Shirt House in a December 22, 2008 electronic-mail
communication addressed to Ms. Dunbar. Pl.’s Exs. 5-6; accord Second Am. Compl. ¶ 16.
According to plaintiff, the solicitation required the concessionaire to possess a heat transfer press
and transfer machine onsite. Pl.’s Ex. 5. Plaintiff stated that she owned the necessary
equipment, whereas The Shirt House did not. Id. She also alleged that Vickie Roldan, a Services
Business Manager for the AAFES at Fort Benning, gave preferential treatment to The Shirt
House and created a conflict of interest by improperly injecting herself into the procurement
process. Id.
On December 30, 2008, Ms. Dunbar denied plaintiff’s protest, determining that it lacked
merit. Pl.’s Ex. 6 at 2; accord Second Am. Compl. ¶¶ 10, 17. First, Ms. Dunbar explained that
the AAFES considered all proposals in a manner that was consistent with applicable procurement
procedures and the solicitation’s criteria. Pl.’s Ex. 6 at 1. Second, she noted that the AAFES
determined The Shirt House was eligible for a contract award, demonstrated satisfactory past
performance, had the necessary organization and experience to perform the contract, and
possessed the necessary technical equipment and facilities–or had the ability to obtain them–in
order to perform the contract. Id. at 2. The Shirt House was awarded the contract, Ms. Dunbar
explained, because it proposed the highest fee to the AAFES. Id. at 1. Third, Ms. Dunbar
rejected plaintiff’s interpretation of the solicitation’s requirements concerning the heat transfer
press and transfer machine, stating that the “contract does not require the contractor to have the
equipment on the premises . . . .” Id. Finally, Ms. Dunbar rejected plaintiff’s accusation that Ms.
Roldan participated in the procurement, stating that Ms. Roldan, who was located at Fort
Benning, had “no influence over or input” into the contract award decision, id. at 2, which was
determined at the AAFES headquarters in Dallas, Texas, see id. at 1-2.
B. Plaintiff’s Concession Contract
On January 22, 2009, less than one month after Ms. Dunbar denied plaintiff’s protest of
the contract award to The Shirt House, plaintiff and the AAFES executed a separate concession
contract BEN 09-04, unrelated to the procurement described above, for the exhibition and sale of
merchandise at Fort Benning. Def.’s Ex. at 1. The performance period under the concession
contract ended on December 31, 2009. Id. Dates of performance, locations of performance, and
the fee paid to the AAFES were determined “by mutual agreement between the Exchange
General Manager (as Contracting Officer) and the concessionaire.” Id. The concession contract
provided that plaintiff would pay to the AAFES “a percentage of gross sales, as identified in the
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Schedule,” id., and the accompanying schedule indicated that plaintiff agreed to pay a twentyfive percent fee to the AAFES for each sales event, id. at 2.
C. Proceedings Before the United States Court of Federal Claims
On July 16, 2009, plaintiff filed a bid protest in the United States Court of Federal Claims
(“Court of Federal Claims”) challenging the award to The Shirt House. She also alleged that the
AAFES breached the concession contract. Adjudicating plaintiff’s motion to supplement the
administrative record, the court ruled that supplementation was not warranted because plaintiff
failed to allege that Ms. Dunbar exhibited bias or acted in bad faith during the procurement
process. Terry v. United States, 96 Fed. Cl. 156, 164-65 (2010). The court explained that
plaintiff’s allegations focused entirely upon Ms. Roldan, id. at 164, and plaintiff failed to identify
specific evidence in the administrative record that raised a question concerning the rationality of
Ms. Dunbar’s decision, id. at 164-65.
In a second decision, the court granted in part and denied in part defendant’s motion to
dismiss.3 Terry v. United States, 96 Fed. Cl. 131 (2010). The court held that it lacked subject
matter jurisdiction over plaintiff’s bid protest pursuant to 28 U.S.C. § 1491(b)(1), but possessed
jurisdiction under 28 U.S.C. § 1491(a)(1) based upon an implied-in-fact contract requiring the
AAFES to fairly and honestly consider plaintiff’s proposal. Id. at 151-53. It also dismissed for
lack of jurisdiction Count II of the amended complaint, which addressed plaintiff’s concession
contract, and plaintiff’s allegations of racial and gender discrimination. Id. at 153-55. The court
later vacated its ruling with respect to Count II of the amended complaint. Terry v. United
States, 98 Fed. Cl. 736 (2011).
Defendant filed its answer to the amended complaint. Thereafter, the court conducted a
preliminary scheduling conference, during which it directed plaintiff to file a second amended
complaint “set[ting] forth clear allegations of bad faith by the contracting officer during the
challenged procurement (Count I) and identif[ying] with specificity the alleged breach of her
concessionaire contract (Count II).” Order, Aug. 29, 2011. Plaintiff filed her second amended
complaint on October 3, 2011, after which defendant filed its motion to dismiss.
D. Plaintiff’s Second Amended Complaint
In Count I of her second amended complaint, plaintiff sets forth numerous allegations
concerning Ms. Dunbar’s conduct during the procurement process. According to plaintiff, Ms.
Dunbar “acted with bad faith” when she: (1) requested “multiple rebids” from offerors, Second
3
In a third, unpublished ruling, the court denied plaintiff’s motion for judgment upon the
administrative record, denied as moot plaintiff’s motion for additional time to file a statement of
facts after ruling on her motion to supplement the administrative record, denied plaintiff’s motion
for alternative dispute resolution, and denied as moot plaintiff’s motion for a permanent
injunction to set aside the contract award to The Shirt House. Order, Nov. 30, 2010.
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Am. Compl. ¶ 42; (2) discussed “the specifics of the bids” with Ms. Roldan, id. ¶ 43; (3)
permitted Ms. Roldan to become “involve[d] with the bids, procurement, or specific bid
information,” id. ¶ 44; (4) failed to adhere to the solicitation’s terms “by not enforcing” the
requirement that the contract awardee had to own specific equipment, id. ¶ 45; (5) accepted
“input” from Ms. Roldan concerning offerors’ proposals, including Ms. Roldan’s “repeated
official influence” upon the outcome of the procurement, id. ¶ 46; (6) authorized Ms. Roldan to
“orchestrate the award of the contract to one other than Plaintiff even though Plaintiff was the
consistent best bidder[] and owned the machine as required in the solicitation,” id. ¶ 47; (7)
failed to amend the solicitation to reflect that the contract awardee was not required to own a heat
transfer press and transfer machine, id. ¶¶ 48-49; (8) prejudiced plaintiff by failing to amend the
solicitation because “such a material change in machine requirements would have changed the
bid numbers for Plaintiff on the rebid,” id. ¶ 48; and (9) worked with Ms. Roldan, who
“deliberately made a negligent misrepresentation to the Plaintiff,” and knew that plaintiff would
rely upon Ms. Roldan’s representation about what the solicitation required, id. ¶ 50. Asserting
that the AAFES arbitrarily, capriciously, and unlawfully awarded a contract to The Shirt House,
plaintiff seeks recovery of her bid preparation costs. Id. ¶¶ 51-52; Pl.’s Ex. 7.
In Count II of the second amended complaint, plaintiff alleges that the twenty-five percent
fee she paid to the AAFES under the concession contract was greater than the fee paid by other
vendors. Second Am. Compl. ¶ 54. Although plaintiff presents numerous allegations concerning
the contracting officer’s conduct, she does not identify by name the contracting officer who
administered the concession contract. The agreement was signed by Kenneth L. Brewington,
“General Manager acting as the Contracting Officer,” Def.’s Ex. at 1, and the court therefore
assumes that Mr. Brewington was the AAFES employee plaintiff identifies as the contracting
officer.
According to plaintiff, Mr. Brewington “acted in bad faith” and breached the concession
contract, “both express and implied,” ¶¶ 56-62, when he: (1) improperly permitted Ms. Roldan
“to exert official influence on the concessionaire rates,” id. ¶ 55; (2) failed to “properly
advertise” for plaintiff, id. ¶ 56; (3) deliberately and improperly placed plaintiff’s kiosks “in slow
retail zones to frustrate Plaintiff’s sales,” id. ¶ 57; (4) promised plaintiff that she could participate
in a “Troop Night” sales event, for which plaintiff purchased $30,000 in merchandise in reliance
upon the purported promise, and then reneged, leaving plaintiff with merchandise she could not
sell, id. ¶¶ 58, 60; (5) failed to protect “the legitimate interests of the supplier through
advertisement, rates and deliberate slow kiosk placement,” id. ¶ 59; and (6) failed to fulfill both
written and oral contract terms, id. ¶ 61. Plaintiff alleges that the AAFES acted irrationally,
arbitrarily, and unlawfully by assigning “uneven percentages” to different vendors. Id. ¶ 62.
Plaintiff seeks a permanent injunction in which the court “set[s] rates for temporary
concessionaires” at Fort Benning. Id. Prayer for Relief ¶ 5.
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II. LEGAL STANDARDS
A. Contracts With the United States
The Tucker Act confers upon the Court of Federal Claims jurisdiction to “render
judgment upon any claim against the United States founded . . . upon any express or implied
contract with the United States . . . .” 28 U.S.C. § 1491(a)(1) (2006). Since the Tucker Act does
not “create any substantive right enforceable against the United States for money damages,”
United States v. Testan, 424 U.S. 392, 398 (1976), the right to money damages must be found in
a separate source of law, Loveladies Harbor, Inc. v. United States, 27 F.3d 1545, 1554 (Fed. Cir.
1994) (en banc); accord Martinez v. United States, 333 F.3d 1295, 1302-03 (Fed. Cir. 2003) (en
banc). “[I]n a contract case, the money-mandating requirement for Tucker Act jurisdiction is
satisfied by the presumption that money damages are available for breach of contract, with no
further inquiry being necessary.” Holmes v. United States, 657 F.3d 1303, 1314 (Fed. Cir.
2011).
B. Motion to Dismiss for Failure to State a Claim Upon Which Relief Can Be Granted
An RCFC 12(b)(6) motion tests the sufficiency of a complaint. Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 555-56 (2007); see also RhinoCorps Ltd. Co. v. United States, 87 Fed.
Cl. 481, 492 (2009) (“A motion made under Rule 12(b)(6) challenges the legal theory of the
complaint, not the sufficiency of any evidence that might be adduced.”). The purpose of RCFC
12(b)(6) “is to allow the court to eliminate actions that are fatally flawed in their legal premises
and destined to fail, and thus to spare litigants the burdens of unnecessary pretrial and trial
activity.” Advanced Cardiovascular Sys., Inc. v. SciMed Life Sys., Inc., 988 F.2d 1157, 1160
(Fed. Cir. 1993) (citing Neitzke v. Williams, 490 U.S. 319, 326-27 (1989)). When considering
an RCFC 12(b)(6) motion, the court “must determine ‘whether the claimant is entitled to offer
evidence to support the claims,’ not whether the claimant will ultimately prevail.” Chapman
Law Firm Co. v. Greenleaf Constr. Co., 490 F.3d 934, 938 (Fed. Cir. 2007) (quoting Scheuer v.
Rhodes, 416 U.S. 232, 236 (1974), overruled on other grounds by Harlow v. Fitzgerald, 457 U.S.
800, 814-19 (1982)). A failure to allege a cause of action upon which relief can be granted
warrants a judgment on the merits rather than a dismissal for want of jurisdiction. Litecubes,
LLC v. N. Light Prods., Inc., 523 F.3d 1353, 1361 (Fed. Cir. 2008).
The court must determine whether the plaintiff can make “allegations plausibly
suggesting (not merely consistent with)” a showing of entitlement to relief. Twombly, 550 U.S.
at 557; see also id. at 570 (requiring that a complaint allege “enough facts to state a claim to
relief that is plausible on its face”); Cambridge v. United States, 558 F.3d 1331, 1335 (Fed. Cir.
2009) (stating that a plaintiff “must plead factual allegations that support a facially ‘plausible’
claim to relief”). 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
alleged.” Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009) (citing Twombly, 550 U.S. at 556).
This plausibility standard “asks for more than a sheer possibility that a defendant has acted
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unlawfully.” Id.; see also id. (stating that a complaint must contain “more than an unadorned,
the-defendant-unlawfully-harmed-me accusation” (citing Twombly, 550 U.S. at 555)). Neither
allegations “that are ‘merely consistent with’ a defendant’s liability,” id. (quoting Twombly, 550
U.S. at 557), nor “[t]hreadbare recitals of the elements of a cause of action, supported by mere
conclusory statements,” are sufficient, id. (citing Twombly, 550 U.S. at 555). Thus, “a plaintiff’s
obligation to provide the grounds of his entitlement to relief requires more than labels and
conclusions, and a formulaic recitation of the elements of a cause of action will not do.”
Twombly, 550 U.S. at 555 (citation & quotation marks omitted). A complaint need not contain
“detailed” factual allegations, but those “[f]actual allegations must be enough to raise a right to
relief above the speculative level . . . .” Id.
The court assumes all well-pled factual allegations are true and indulges in all reasonable
inferences in favor of the nonmovant. United Pac. Ins. Co. v. United States, 464 F.3d 1325,
1327-28 (Fed. Cir. 2006); accord Sommers Oil Co. v. United States, 241 F.3d 1375, 1378 (Fed.
Cir. 2001). However, it “is ‘not bound to accept as true a legal conclusion couched as a factual
allegation.’” Acceptance Ins. Cos. v. United States, 583 F.3d 849, 853 (Fed. Cir. 2009) (quoting
Twombly, 550 U.S. at 555); see also Clegg v. Cult Awareness Network, 18 F.3d 752, 754-55
(9th Cir. 1994) (“[T]he court is not required to accept legal conclusions cast in the form of
factual allegations if those conclusions cannot reasonably be drawn from the facts alleged.”).
Furthermore, the court is not required to accept as true allegations that “contradict matters
properly subject to judicial notice or by exhibit.” Sprewell v. Golden State Warriors, 266 F.3d
979, 988 (9th Cir. 2001).
Generally, courts consider “only the allegations contained in the complaint, exhibits
attached to the complaint[,] and matters of public record” when deciding an RCFC 12(b)(6)
motion to dismiss. Pension Benefit Guar. Corp. v. White Consol. Indus., Inc., 998 F.2d 1192,
1196 (3d Cir. 1993). Thus, if “matters outside the pleadings are presented to and not excluded by
the court, the motion must be treated as one for summary judgment under RCFC 56.” RCFC
12(d). Taking judicial notice of public records does not require the court to treat a motion to
dismiss as one for summary judgment. Sebastian v. United States, 185 F.3d 1368, 1374 (Fed.
Cir. 1999); see also Anspach ex rel. Anspach v. City of Phila., Dep’t of Pub. Health, 503 F.3d
256, 273 n.11 (3d Cir. 2007) (“Courts ruling on Rule 12(b)(6) motions may take judicial notice
of public records.”); Wyser-Pratte Mgmt. Co. v. Telxon Corp., 413 F.3d 553, 560 (6th Cir. 2005)
(“In addition to the allegations in the complaint, the court may also consider other materials that
are integral to the complaint, are public records, or are otherwise appropriate for the taking of
judicial notice.”); Gant v. United States, 63 Fed. Cl. 311, 314 (2004) (converting an RCFC
12(b)(6) motion into one for summary judgment because the defendant presented “documentary
exhibits not subject to judicial notice” with its motion); cf. Phillips v. Bureau of Prisons, 591
F.2d 966, 969 (D.C. Cir. 1979) (“[W]hen passing on a motion attacking the legal efficacy of the
plaintiff’s statement of his claim, the court may properly look beyond the complaint only to items
in the record of the case or to matters of general public record.”). Additionally, documents
appended to a motion to dismiss “are considered part of the pleadings if they are referred to in the
plaintiff’s complaint and are central to his claim. Such documents may be considered by a
8
district court in ruling on a motion to dismiss.” Wright v. Assoc. Ins. Cos., 29 F.3d 1244, 1248
(7th Cir. 1994). The reason for considering such documents is that the court “is not bound to
accept the pleader’s allegations as to the effect of the exhibit, but can independently examine the
document and form its own conclusions as to the proper construction and meaning to be given
the material.” 5A Charles Alan Wright & Arthur R. Miller, Federal Practice & Procedure § 1327
(3d ed. 2004).
III. DISCUSSION
According to defendant, plaintiff does not allege sufficient facts in Count I to show that
the AAFES breached an implied-in-fact contract for the honest and fair consideration of her
proposal. It also argues that plaintiff does not allege sufficient facts in Count II to show that the
AAFES breached the concession contract. In response, plaintiff concedes that defendant “may
very well be correct that there is no possible way to prove what [plaintiff] has alleged since 2009
against AAFES/Fort Benning,” Opp’n 2, but nevertheless contends that she “has articulated facts
that can be reasonably inferred in her favor,” id. at 3. Therefore, plaintiff argues that dismissal
pursuant to RCFC 12(b)(6) is inappropriate.
A. The Court Must Dismiss Count I of the Second Amended Complaint
Plaintiff sets forth numerous allegations in Count I concerning the terms of the
solicitation. According to plaintiff, the solicitation “required that the T-Shirt Operator maintain a
machine on site to make T-Shirts for soldiers while they wait, and not to place orders to be
printed off the military installation[] and picked up at a later time.” Second Am. Compl. ¶ 7.
Additionally, plaintiff alleges that Ms. Dunbar violated the solicitation’s terms when she
requested final proposals from offerors, id. ¶ 13, and issued an award to The Shirt House, which
plaintiff contends was “unable to meet the requirements of the solicitation,” id. ¶ 26, because it
did not own an Anajet Garment Printer or other Heat Transfer Press and Transfer Machine “as
covered under the Solicitation,” id. ¶ 25. The solicitation’s terms are therefore integral to the
claims plaintiff asserts in Count I. See Lenox Hill Hosp., 131 F. Supp. 2d at 140 n.4. Moreover,
plaintiff, having cited the solicitation and appended a portion thereof to her prior pleading, has
incorporated by reference the entire solicitation into her pleading. See W & D Ships Deck
Works, Inc., 39 Fed. Cl. at 647 n.7; Pl.’s Ex. 1 at 2-5. As such, the solicitation, itself “a public
document available to all bidders” of which the court can take judicial notice, Avtel Servs., Inc.
v. United States, 70 Fed. Cl. 173, 194 (2006), is not a matter outside the pleadings for purposes
of adjudicating defendant’s RCFC 12(b)(6) motion.4
4
The fact that defendant produced the entire solicitation as part of the administrative
record does not affect the court’s determination. Although it is true that an administrative
record–described as “something of a fiction” because it represents an agency’s compilation of
“materials that adequately document the facts and reasoning supporting the agency’s decision,”
PlanetSpace, Inc. v. United States, 90 Fed. Cl. 1, 4 (2009)–is considered a matter outside the
pleadings, Lenox Hill Hosp. v. Shalala, 131 F. Supp. 2d 136, 140 n.4 (D.D.C. 2000), conversion
9
Plaintiff must plead factual allegations that support a facially plausible claim to relief,
Cambridge, 558 F.3d at 1335, and permit the court to draw a reasonable inference that the
government is liable for the alleged wrongdoing, Ashcroft, 129 S. Ct. at 1949. As the United
States Court of Appeals for the Federal Circuit (“Federal Circuit”) has explained, “[g]overnment
officials are presumed to act in good faith, and ‘it requires “well-nigh irrefragable proof” to
induce a court to abandon the presumption of good faith.’” T & M Distribs., Inc. v. United
States, 185 F.3d 1279, 1285 (Fed. Cir. 1999) (quoting Kalvar Corp. v. United States, 543 F.2d
1298, 1301-02 (Ct. Cl. 1976)); see also Impresa Construzioni Geom. Domenico Garufi v. United
States, 238 F.3d 1324, 1338 (Fed. Cir. 2001) (explaining that agency decisions, including those
of contracting officers, are entitled to a presumption of regularity “unless that presumption has
been rebutted by record evidence that the agency decision is arbitrary and capricious”).
Conclusory assertions and speculation are insufficient to suggest bad faith. See, e.g., Madison
Servs., Inc. v. United States, 94 Fed. Cl. 501, 507 (2010) (“This allegation of bad faith, however,
is merely a conclusion drawn from speculation as to the existence of certain occurrences . . . .”);
Conway v. United States, 56 Fed. Cl. 572, 578 (2003) (determining that allegations of bad faith
were “merely conclusory and . . . clearly contradictory to the record”); J. Cooper & Assocs., Inc.
v. United States, 53 Fed. Cl. 8, 25 (2002) (“Mere speculation on the part of the plaintiff is an
insufficient basis to meet the rigorous test to establish bad faith.”).
The court must, as noted above, accept as true the facts alleged in plaintiff’s second
amended complaint, see Davis v. Monroe Cnty. Bd. of Educ., 526 U.S. 629, 633 (1999), but it is
not bound to accept plaintiff’s allegations with respect to the effect of an exhibit and may
independently examine its contents, 5A Wright & Miller, supra, § 1327; see also Forrest v.
Universal Sav. Bank, F.A., 507 F.3d 540, 542 (7th Cir. 2007) (“A court is not bound by the
party’s characterization of an exhibit and may independently examine and form its own opinions
about the document.”). Thus, where the unambiguous terms of a contract conflict with the
allegations set forth in a complaint, the contract controls. INEOS Polymers Inc. v. BASF
Catalysts & BASF Aktiengesellsch, 553 F.3d 491, 498 (7th Cir. 2009); accord Centers v.
Centennial Mortg., Inc., 398 F.3d 930, 933 (7th Cir. 2005); see also LaSalle Bank Nat’l Ass’n v.
Paramont Props., 588 F. Supp. 2d 840, 848 (N.D. Ill. 2008) (“[T]he Court considers the exhibits
attached to the complaint, but where an exhibit conflicts with the allegations of the complaint,
the exhibit typically controls.”).
Plaintiff offers nothing more than her own conclusory statements and speculation
concerning the procurement process and Ms. Roldan’s participation therein. First, plaintiff
of a motion to dismiss into one for summary judgment is appropriate when the court reviews
agency action pursuant to the Administrative Procedure Act (“APA”), 5 U.S.C. §§ 701-706
(2006). See Marshall Cnty. Health Care Auth. v. Shalala, 988 F.2d 1221, 1228 (D.C. Cir. 1993)
(stating that judicial review of the agency record “may not be had without converting the motion
to dismiss into a motion for summary judgment”). Here, however, the court does not engage in
APA record review or utilize nonpublic documents in the administrative record to test the
sufficiency of plaintiff’s factual allegations.
10
claims that Ms. Dunbar “acted with bad faith by requesting multiple rebids on the solicitation.”
Second Am. Compl. ¶ 42. In her letter denying plaintiff’s protest, Ms. Dunbar explained that she
never requested that plaintiff modify her bid. Pl.’s Ex. 6 at 1. Rather, Ms. Dunbar expressed
concern over what she perceived as unreasonably high fees and requested an MPOS from each
offeror in order “to see if the contractor could operate at such a high fee.” Pl.’s Ex. 6 at 1. The
solicitation authorized Ms. Dunbar to request “a financial statement, a cost breakdown, a
projected operating statement, or other data from any offeror.” AR 35. Therefore, plaintiff has
not made any showing that Ms. Dunbar acted in bad faith when she requested an MPOS from all
offerors, including plaintiff, after which plaintiff independently revised her fee percentage, or did
not honestly and fairly consider her proposal.5
Second, plaintiff alleges that Ms. Dunbar acted in bad faith through her various
interactions with Ms. Roldan, who, according to plaintiff, improperly inserted herself into the
procurement and decision making process. Second Am. Compl. ¶¶ 43-44, 46-47, 50. In her
December 30, 2008 letter denying plaintiff’s protest, Ms. Dunbar explained that Ms. Roldan “had
no influence over or input into the decision to award the contract.” Pl.’s Ex. 6 at 1. Plaintiff
alleges no facts that call into question the accurateness of Ms. Dunbar’s explanation and has not
made any showing that Ms. Dunbar did not honestly and fairly consider her proposal.
Finally, plaintiff claims that Ms. Dunbar acted in bad faith in connection with her
purported failure to “enforc[e] the specifics of the solicitation requirement of a Heat Transfer
Press and Transfer Machine.” Second Am. Compl. ¶ 45; see also id. ¶¶ 48 (claiming that
plaintiff purchased the equipment because the “solicitation required it” and that Ms. Dunbar
failed to amend the solicitation “to reflect that the machine was not required for award of the
contract”), 49 (asserting that Ms. Dunbar’s failure to amend the solicitation was “done in bad
faith and was prejudicial”). All offerors were “encouraged to contact the contracting officer if
[they] ha[d] a question concerning th[e] solicitation.” AR 35. Plaintiff does not allege that she
followed the procedure set forth within the solicitation for seeking clarification about any term or
requirement set forth therein. Furthermore, plaintiff has not made any showing that Ms.
Dunbar’s purported failure to amend the solicitation was prejudicial and that Ms. Dunbar did not
honestly and fairly consider her proposal.
As explained above, when a conflict between the contents of an exhibit and the
allegations of a complaint arises, the exhibit typically controls. Forrest, 507 F.3d at 542; Centers,
398 F.3d at 933; LaSalle Bank Nat’l Ass’n, 588 F. Supp. 2d at 848. Indeed, the United States
5
Plaintiff alleges that she was the only vendor that paid a fee of twenty-five percent to
the AAFES, whereas other vendors paid less. Second Am. Compl. ¶¶ 34, 54. The court assumes
the truth of plaintiff’s allegation and notes that plaintiff initially submitted a proposal setting
forth a fee of thirty percent. Pl.’s Ex. 1 at 1. Thus, Ms. Dunbar’s concern about the offerors’
abilities to operate at fees in excess of twenty-five percent, which plaintiff asserts was the highest
fee paid by any vendor, and request for an MPOS do not suggest that Ms. Dunbar acted with
impropriety or in bad faith.
11
Court of Appeals for the Seventh Circuit observed: “A plaintiff may plead himself out of court by
attaching documents to the complaint that indicate that he or she is not entitled to judgment.” In
re Wade, 969 F.2d 241, 249 (7th Cir. 1992). Here, plaintiff’s allegations conflict with the terms
of the solicitation, the latter of which is controlling. Specifically, the solicitation did not require
an offeror to own or purchase equipment in order to participate in the procurement. In fact, the
solicitation expressly permitted the concessionaire to lease equipment intended for use during
contract performance, provided it furnished the lessor’s name and address to Ms. Dunbar. See
AR 55. Furthermore, the solicitation advised offerors that any investment in equipment by the
concessionaire constituted “a business risk” borne solely by the concessionaire. Id. (“[N]either
AAFES nor any other agency or instrumentality of the United States [wa]s . . . liable to
concessionaire for costs of concessionaire’s investing in equipment . . . in the event of
termination of this contract without extension.”). If the government was not liable to the
concessionaire for any investment in equipment once a contractual relationship was established,
then, a fortiari, the government was not liable for an offeror’s investment in equipment the
offeror made during the procurement process and prior to the contract award. Plaintiff’s
allegations concerning the solicitation’s requirements are therefore contradicted by the
solicitation itself.
In short, plaintiff presents conclusory and speculative allegations that are contrary to (1)
the exhibits appended to and incorporated by reference in her pleadings and (2) the terms of the
solicitation at issue. In such circumstances, the contents of the exhibits and solicitation control,
and the court need not accept as true plaintiff’s allegations related thereto. Because plaintiff fails
to allege facts showing that Ms. Dunbar acted in bad faith and did not fairly and honestly
consider plaintiff’s proposal, the court grants defendant’s motion to dismiss with respect to
Count I.
B. The Court Must Dismiss Count II of the Second Amended Complaint
In Count II, plaintiff alleges numerous acts of bad faith on the part of Mr. Brewington that
she contends amount to breaches by the AAFES of the concession contract. These include: (1)
discriminating against plaintiff by requiring her to pay a higher fee than those paid by other
vendors, Second Am. Compl. ¶¶ 33-38, 62; (2) failing to advertise on behalf of plaintiff, id. ¶ 56;
(3) assigning plaintiff’s kiosk to locations with less customer traffic in order to frustrate sales and
adversely affect her interests, id. ¶¶ 57, 59; (4) misrepresenting to plaintiff that she could
participate in a “Troop Night” sales event, for which plaintiff asserts a claim for promissory
estoppel, id. ¶¶ 58-60; and (5) failing to honor “all written and oral contracts, express or
implied,” id. ¶¶ 56-62.
Plaintiff does not expressly seek money damages for the alleged breach of the concession
contract. See id. Prayer for Relief ¶ 5 (requesting that the court issue a permanent injunction
“set[ting] rates for temporary concessionaires at Fort Benning at the same equal rate as mandated
by policy and standards”). In Holmes, the Federal Circuit explained that “when a breach of
contract claim is brought in the Court of Federal Claims under the Tucker Act, the plaintiff
12
comes armed with the presumption that money damages are available, so that normally no further
inquiry is required.” 657 F.3d at 1314; see also Sanders v. United States, 252 F.3d 1329, 1334
(Fed. Cir. 2001) (stating that, “in the area of government contracts, . . . there is a presumption in
the civil context that a damages remedy will be available upon the breach of an agreement”). As
part of her breach of contract claim, plaintiff does allege that she incurred a loss of $30,000 in
inventory after Mr. Brewington reneged on a promise permitting plaintiff to participate in a
“Troop Night” sales event. Second Am. Compl. ¶¶ 58, 60. Thus, the court is satisfied that
plaintiff seeks money damages for the purported breach of the concession contract. Nevertheless,
as explained below, the court lacks jurisdiction to entertain two of plaintiff’s claims and to award
equitable relief, and plaintiff’s remaining allegations fail to state a claim upon which relief can be
granted.
1. The Court Lacks Jurisdiction Over Discrimination and Promissory Estoppel Claims,
and Plaintiff’s Request for Equitable Relief
The court previously dismissed plaintiff’s allegations of racial and gender discrimination,
see Second Am. Compl. ¶¶ 33-38, for lack of subject matter jurisdiction, see Terry, 96 Fed. Cl. at
155; see also Order 2, June 28, 2011 (reaffirming the court’s prior ruling that it lacked
jurisdiction over plaintiff’s discrimination allegations). The Court of Federal Claims is not a
district court. See Simmons v. United States, 71 Fed. Cl. 188, 193 (2006); see also 28 U.S.C. ch.
5 (describing the various federal district courts). District courts possesses exclusive jurisdiction
over discrimination claims. See 28 U.S.C. § 1343(a)(4). To the extent plaintiff reasserts that the
AAFES required her to pay a fee that exceeded a percentage paid by other vendors, Second Am.
Compl. ¶ 54, such allegations fall within her previously dismissed discrimination claim and,
therefore, cannot be entertained by the court.
The court also lacks jurisdiction over plaintiff’s claim of promissory estoppel, id. ¶ 60,
which is “another name for an implied-in-law contract claim,” Hubbs v. United States, 20 Cl. Ct.
423, 427 (1990). An agreement implied in law “is a ‘fiction of law’ where ‘a promise is imputed
to perform a legal duty, as to repay money obtained by fraud or duress.’” Hercules Inc. v. United
States, 516 U.S. 417, 424 (1996) (quoting Balt. & Ohio R.R. Co. v. United States, 261 U.S. 592,
597 (1923)); see also Int’l Data Prods. Corp. v. United States, 492 F.3d 1317, 1325 (Fed. Cir.
2007) (explaining that an implied-in-law contract is one “in which there is no actual agreement
between the parties, but the law imposes a duty in order to prevent injustice”). The Tucker Act
“does not reach claims based on contracts implied in law . . . .” United States v. Mitchell, 463
U.S. 206, 218 (1983); see also Merritt v. United States, 267 U.S. 338, 341 (1925) (“The Tucker
Act does not give a right of action against the United States in those cases where, if the
transaction were between private parties, recovery could be had upon a contract implied in
law.”); Steinberg v. United States, 90 Fed. Cl. 435, 443 (2009) (“Promissory estoppel . . .
requires the court find an implied-in-law contract, a claim for which the United States has not
waived its sovereign immunity.”).
13
Plaintiff also seeks an injunction directing the AAFES to establish equal rates for all
vendors conducting business at Fort Benning. Except in three statutorily defined circumstances,
the court lacks jurisdiction to award injunctive relief. See Kanemoto v. Reno, 41 F.3d 641,
644-45 (Fed. Cir. 1994) (“The remedies available in [the Court of Federal Claims] extend only to
those affording monetary relief; the court cannot entertain claims for injunctive relief or specific
performance, except in narrowly defined, statutorily provided circumstances . . . .”). None of
those circumstances applies here. See 28 U.S.C. § 1491(a)(2) (providing the court with
jurisdiction to issue, “as incident of and collateral to” an award of money damages, “orders
directing restoration to office or position, placement in appropriate duty or retirement status, and
correction of applicable records”); id. (providing the court with jurisdiction to render judgment in
nonmonetary disputes arising under the Contract Disputes Act of 1978); id. § 1491(b)(2)
(providing the court with jurisdiction to award declaratory and injunctive relief in bid protests);
accord Pellegrini v. United States, No. 11-224L, 2012 WL 171912, at *7 (Fed. Cl. Jan. 20, 2012).
Accordingly, plaintiff’s discrimination and promissory estoppel claims are dismissed, see
RCFC 12(h)(3) (“If the court determines at any time that it lacks subject-matter jurisdiction, the
court must dismiss the action.”), and the court lacks jurisdiction to award equitable relief.
2. Plaintiff’s Remaining Allegations Fail to State a Claim Upon Which Relief Can Be
Granted
Turning to plaintiff’s allegations asserting the breach of “express and implied”
contractual provisions by Mr. Brewington, see Second Am. Compl. ¶¶ 56-62, neither party
disputes that plaintiff and the AAFES entered into the concession contract, Def.’s Ex. at 1-6. It
is “well settled that the existence of an express contract precludes the existence of an implied-infact contract dealing with the same subject matter, unless the implied contract is entirely
unrelated to the express contract.” Schism v. United States, 316 F.3d 1259, 1278 (Fed. Cir.
2002). Here, plaintiff alleges that Mr. Brewington and the AAFES breached the concession
contract and a purported implied-in-fact contract, but she fails to allege facts showing that the
latter was unrelated to the subject matter encompassed by the former. Consequently, plaintiff’s
purported implied-in-fact contract is foreclosed by the concession contract. See Bank of Guam v.
United States, 578 F.3d 1318, 1329 (Fed. Cir. 2009).
Next, plaintiff alleges that Mr. Brewington “promis[ed]” plaintiff that she could
participate in a “Troop Night” sales event–a promise upon which plaintiff contends she relied to
her detriment–and then reneged on that promise. Second Am. Compl. ¶¶ 58, 60; see also id. ¶ 61
(alleging breach of “oral contract terms with Plaintiff”). She also claims that Mr. Brewington
failed to advertise plaintiff’s business, id. ¶ 56, and deliberately located her kiosk in “slow retail
zones to frustrate Plaintiff’s sales,” id. ¶ 57. Plaintiff fails to identify any concession contract
provision that Mr. Brewington and the AAFES purported breached based upon these allegations.
Indeed, the concession contract expressly indicated that the AAFES did
14
not guarantee that the concessionaire will be scheduled and permitted to exhibit
and sell merchandise. The performance dates, exact locations and fee to AAFES
will be determined by mutual agreement between the Exchange General Manager
(as Contracting Officer) and the concessionaire. . . .
....
. . . AAFES make no representation as to the number and frequency of
sales events or volume of business contractor may anticipate under this contract.
Def.’s Ex. at 1. Furthermore, the concession contract stated: “Except as otherwise specifically
provided in this contract, all changes, modifications, additions or deletions to this contract must
be prepared in writing as formal amendments signed by both parties and approved in accordance
with provisions of applicable regulations.” Id. at 3. Plaintiff assented to these concession
contract terms, which indicate that the AAFES was not obligated to (1) allow plaintiff to
participate in the “Troop Night” sales event or (2) advertise on her behalf. See id. at 1.
Moreover, the location of plaintiff’s kiosk and the fee she paid to the AAFES were “determined
by mutual agreement.” Id. The schedule appended to the concession contract indicates that
plaintiff, on ten separate occasions, agreed to pay a twenty-five percent fee to the AAFES. See
id. at 2. Consequently, plaintiff fails to allege facts showing that the AAFES breached the
concession contract.
In short, the court lacks jurisdiction over and dismisses plaintiff’s (1) discrimination and
promissory estoppel claims and (2) request for injunctive relief. The court is not bound to accept
plaintiff’s allegations concerning the effect of her concession contract, which are conclusory,
speculative, and contrary to the terms thereof. Because plaintiff fails to allege facts showing that
the AAFES breached the concession contract, the court grants in part and denies in part as moot
defendant’s motion to dismiss with respect to Count II.
IV. CONCLUSION
For the reasons discussed above, defendant’s motion to dismiss is GRANTED IN PART
and DENIED IN PART AS MOOT. Plaintiff’s discrimination and promissory estoppel claims
are DISMISSED WITHOUT PREJUDICE for lack of jurisdiction, and plaintiff’s remaining
allegations are DISMISSED WITH PREJUDICE. The clerk is directed to enter judgment
accordingly. No costs.
IT IS SO ORDERED.
s/ Margaret M. Sweeney
MARGARET M. SWEENEY
Judge
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