[00:00:01] Speaker 00: Case number 21-7T08, Schindler Elevator Corporation, a New Jersey Corporation appellant versus Washington Metropolitan Area Transit Authority, an interstate agency created by Compact and Coney Inc. [00:00:15] Speaker 00: Mr. Bartolomucci for the appellant, Mr. Barnes for the appellate. [00:00:20] Speaker 04: Mr. Bartolomucci, go ahead. [00:00:22] Speaker 04: Please the court, Chris Bartolomucci for Appellant Schindler Elevator Corporation. [00:00:28] Speaker 04: This must be the court's day to hear waiver cases. [00:00:32] Speaker 04: Our position in this case is very straightforward. [00:00:35] Speaker 04: WMATA has waived its immunity in protest cases like this one. [00:00:41] Speaker 04: In the procurement procedures manual, WMATA adopted a clear protest policy, which states that federal district courts, quote, have jurisdiction over court actions concerning protest decisions, end quote. [00:00:59] Speaker 04: The policy requires WMATA to give notice in all solicitations. [00:01:05] Speaker 04: WMATA's policy is to tell protesters that they can go to federal court. [00:01:10] Speaker 04: WMATA did so in the RFP here and in the final decision denying Schindler's protest. [00:01:18] Speaker 02: Now, WMATA... Mr. Brattalamucci, can I just ask you a basic question because your argument does sound very straightforward, but I'm trying to understand how you can argue [00:01:29] Speaker 02: that WMATA has the authority to waive its immunity, that WMATA itself can come up with the conditions under which it can be sued in light of the compact, which gave it immunity on certain conditions. [00:01:47] Speaker 04: Well, Your Honor, the immunity belongs to WMATA, and WMATA therefore has the power to waive it. [00:01:55] Speaker 02: But WMATA didn't get all immunity. [00:01:57] Speaker 02: WMATA didn't get [00:01:59] Speaker 02: a whole, if you will, of immunity. [00:02:02] Speaker 02: WMATA got immunity under certain conditions, right? [00:02:06] Speaker 02: Am I wrong about that? [00:02:07] Speaker 02: I thought the compact says [00:02:10] Speaker 02: you get this immunity and you can only be sued for contracts and torts related to your proprietary functions. [00:02:19] Speaker 02: So under what circumstance does WMATA get to say, no, no, no, we'd like to be sued under other things, for other things, for whatever we put in our manuals. [00:02:29] Speaker 02: Do they have the ability to do that? [00:02:31] Speaker 04: They certainly have the ability to waive their immunity. [00:02:34] Speaker 04: Sovereign immunity may be waived at pleasure. [00:02:37] Speaker 02: But they're not a sovereign. [00:02:39] Speaker 02: They got their sovereign immunity from somewhere else. [00:02:42] Speaker 02: And so do we have any cases that say that WMATA has the authority of a true sovereign in terms of its ability to waive its immunity outside of the circumstances of the compact? [00:02:55] Speaker 04: Well, yes, let me cite you two cases. [00:02:57] Speaker 04: So in the barber case, this court held, I know that Judge Santel dissented, but not on this ground. [00:03:04] Speaker 04: In the barber case, this court held that WMATA waived its immunity by taking federal funds. [00:03:11] Speaker 04: Now, it wasn't the three states that took the federal funds, it was WMATA, and that was held to be a waiver. [00:03:18] Speaker 04: And in the ongoing unsung DC Metro case, so that's a case in which WMATA has created a FOIA-like cause of action. [00:03:29] Speaker 04: And there's an issue about whether it can do that, but there's no issue about their ability to waive their sovereign immunity in that case. [00:03:38] Speaker 04: Obviously, they can't create a FOIA-like action unless they waive their immunity against such claims. [00:03:46] Speaker 04: And that's not even an issue in that case. [00:03:48] Speaker 04: The issue that's being litigated is whether they can create a cause of action in the first instance, but no one has disputed [00:03:56] Speaker 04: that they can waive their immunity to entertain such claims if they can validly create a cause of action. [00:04:03] Speaker 04: So I think there's no doubt, Judge Jackson, that they can waive their immunity. [00:04:08] Speaker 02: I think there is a doubt. [00:04:11] Speaker 02: And can you just entertain my, it's a doubt that maybe is only mine and that I'm creating in this context. [00:04:17] Speaker 02: But the compact, what gave them the immunity, carried with it certain conditions, [00:04:24] Speaker 02: you are immune to all of these various things except for towards of certain types of contracts. [00:04:33] Speaker 02: I don't see anywhere in that compact that also said and any place, any time that you decide that you would like to be sued, any waiver that you would come up with. [00:04:47] Speaker 02: So under what circumstance I'm trying to understand [00:04:50] Speaker 02: Does WMATA get to say, we see the compact and the circumstances under which the states wanted us to be sued, but we are going to decide that we can be sued in other situations. [00:05:01] Speaker 04: I'm glad you asked that question, because this gets to Section 80 of the Compact. [00:05:08] Speaker 04: Now, Section 80 waives immunity for contract claims and for certain tort claims. [00:05:14] Speaker 04: But Section 80 is not the end all and be all. [00:05:17] Speaker 04: WMATA has the ability to waive other claims in other ways, just like it did in Barber. [00:05:23] Speaker 04: Barbara did not involve a contract or a tort claim. [00:05:27] Speaker 04: It involved a Section 504 Rehabilitation Act claim for termination based upon mental illness. [00:05:34] Speaker 04: But this court held that because WMATA accepted federal funds, it waived its immunity. [00:05:41] Speaker 04: In the Slack case in the district court, that involves a statutory whistleblower claim, so not a contract or a tort claim. [00:05:51] Speaker 04: And the district court held in that case, and WMATA didn't appeal, that WMATA's adoption of a policy telling whistleblowers that they can sue effectively waived their sovereign immunity as against these whistleblower type claims. [00:06:08] Speaker 04: And again, I will again cite the UNSAT DC Metro case. [00:06:13] Speaker 04: That involves a FOIA-like claim. [00:06:16] Speaker 04: It's not a contract claim. [00:06:17] Speaker 04: It's not a tort claim. [00:06:19] Speaker 04: So it's not governed by Section 80. [00:06:21] Speaker 04: But there's no dispute in that case. [00:06:23] Speaker 04: And I think my friend on the other side will say this. [00:06:26] Speaker 04: You know, WMATA has the authority to waive its immunity as against a FOIA-type claim, what they call a PARP [00:06:35] Speaker 04: claim. [00:06:37] Speaker 04: So Section 80 governs some types of waivers, but it's not all encompassing. [00:06:46] Speaker 04: Otherwise, Barbara would have been very simple. [00:06:49] Speaker 04: Barbara would have said, well, you know, this isn't a contract or a tort claim, so Section 80 doesn't apply, and you're out of luck. [00:06:57] Speaker 04: WMATA has immunity. [00:06:59] Speaker 04: but this court held there was waiver in barber and Judge Santel's dissent was on other grounds. [00:07:07] Speaker 04: So I really do feel that because the cases are legions saying that sovereign immunity is the kind of immunity that can be waived at pleasure. [00:07:18] Speaker 04: If they never raise it in a case and if the district judge doesn't bring it up, it's gone. [00:07:24] Speaker 04: If they remove the case from state to [00:07:27] Speaker 04: federal court, it's gone. [00:07:30] Speaker 04: So it can be waived in lots of ways. [00:07:33] Speaker 04: It's not all governed by Section 80. [00:07:36] Speaker 04: So if you accept my premise that sovereign immunity is waivable, I think they've clearly done that in the PPM, the Procurement Procedures Manual, and they did it again in the RFP and in the final decision on Schindler's protest. [00:07:59] Speaker 04: You know, I understand that there is an issue in this case about whether WMATA is a federal agency or not. [00:08:07] Speaker 04: But what I would say about that is that's not a jurisdictional issue. [00:08:12] Speaker 04: That goes to what Schindler's cause of action is. [00:08:16] Speaker 04: And we're not here today on the 12b6 motion. [00:08:19] Speaker 04: We're not trying to decide whether Schindler can stay the cause of action. [00:08:23] Speaker 04: Schindler got bounced based on sovereign immunity. [00:08:26] Speaker 03: So I think it would be unfair to- Your case today does not depend on being a federal agency, made of being a federal agency, I mean. [00:08:35] Speaker 04: That is correct. [00:08:36] Speaker 04: And the court doesn't have to answer that question. [00:08:39] Speaker 03: If Wamata's a federal agency- That's what I'm getting at, yes. [00:08:41] Speaker 04: Yeah. [00:08:42] Speaker 04: And Judge Santel, you faced this issue in the Elcon case. [00:08:46] Speaker 04: And the panel that you wrote for decided not to decide that issue because it's trickier than you might think. [00:08:54] Speaker 04: But if WMATA is a federal agency, then the federal APA applies and they've lost immunity. [00:09:02] Speaker 03: You maybe don't want to get into all of it. [00:09:05] Speaker 03: I won't. [00:09:05] Speaker 03: The court doesn't have to. [00:09:06] Speaker 02: Mr. Bartolomeochi, let me go back a little bit to the question that I asked you in another way. [00:09:12] Speaker 02: Which is you. [00:09:14] Speaker 02: So is it your argument that section 81 of the compact that talks about the jurisdiction of the courts has to be interpreted. [00:09:21] Speaker 02: Separate and apart from 80 and if so, what do we do about our precedents that say those two are working in conjunction with one another. [00:09:31] Speaker 04: Well, here's how I read it section 80 broadly gives the federal courts jurisdiction. [00:09:37] Speaker 02: Now, sovereign immunity- 81, I'm sorry, 81 is what you meant? [00:09:41] Speaker 04: 81, yes. [00:09:42] Speaker 04: Yes. [00:09:43] Speaker 04: I'm sorry. [00:09:44] Speaker 04: 81 gives the federal court's jurisdiction. [00:09:47] Speaker 04: Now, sovereign immunity is a defense to jurisdiction. [00:09:50] Speaker 04: Sovereign immunity is partially waived in section 80, but it can be waived in other ways as well. [00:09:57] Speaker 04: So you can have a case like this one where jurisdiction arises under section 81. [00:10:03] Speaker 04: The case is not governed by section 80. [00:10:06] Speaker 04: and WMATA has affected a waiver in another way, in this case by enacting a clear protest policy. [00:10:13] Speaker 03: I was gonna say you would have to concede that the waiver has to be clear. [00:10:17] Speaker 03: It does, that's the barber test. [00:10:19] Speaker 03: That's, yes. [00:10:20] Speaker 02: But don't we have precedent from this circuit, and I can't remember the case name off the top of my head, but don't we have precedent that says that you interpret 81 consistent with 80? [00:10:33] Speaker 04: Well, the court has said things like that in cases involving tort or contract claims, which is the vast majority of claims against WMATA. [00:10:43] Speaker 04: But this is an administrative APA type claim. [00:10:49] Speaker 04: So you have to pay attention to whether the cases that say things like that involve tort or contract claims, which this case does not. [00:10:57] Speaker 04: So that's why AD doesn't apply here. [00:11:00] Speaker 04: because this is an APA or APA-like case. [00:11:05] Speaker 01: All right, if there are no more questions, Mr. Barnes. [00:11:15] Speaker 05: Mr. Barnes. [00:11:16] Speaker 05: Thank you, Your Honor. [00:11:18] Speaker 05: The court should affirm dismissal because the WMATA compact that was adopted by the three jurisdictions establishes WMATA sovereign immunity in this case. [00:11:27] Speaker 05: As the court noted in the Banneker decision, Section 80 provides that there's only a limited waiver of claims in Section 80, and that's for contracts and certain torts. [00:11:37] Speaker 05: In this case, Schindler has conceded that this case does not involve a contract or tort. [00:11:42] Speaker 05: It's Schindler's burden to prove jurisdiction, and it hasn't done so. [00:11:46] Speaker 05: This is a jurisdictional issue, and this court has been clear, both in the Kiska case and in the Burkhart case, that this is a subject matter jurisdiction issue, the sovereign immunity of LaMotta. [00:11:57] Speaker 02: Can you entertain Mr. Bardo-Lamucci's framing, though, because what he is suggesting is that the statement in 80 concerning contracts and torts [00:12:12] Speaker 02: actually relates to those kinds of claims, but not necessarily the scope of the immunity. [00:12:20] Speaker 02: In other words, he says, fine, this is not a contracted court claim, so 80 doesn't apply, and 81 says the court has jurisdiction, and WMATA has all of the sovereign immunity of the original states that created it. [00:12:36] Speaker 02: Why is he wrong about that? [00:12:38] Speaker 05: Well, he's wrong because the courts have decided otherwise. [00:12:41] Speaker 05: And in the Morris case, there was certainly, as your honor was discussing earlier, you need to read these in conjunction. [00:12:48] Speaker 05: And section 80 has been interpreted and found to be the limited waiver clause. [00:12:54] Speaker 05: And section 81 is found to be basically the forum selection type clause. [00:12:58] Speaker 05: In other words, you can't read them separately. [00:13:01] Speaker 05: You have to read them together. [00:13:02] Speaker 02: So is it your position [00:13:05] Speaker 02: that the states that created WMATA gave WMATA the full immunity and per the compact waived only what we see in 80. [00:13:17] Speaker 02: So every WMATA cannot be sued for anything else. [00:13:21] Speaker 05: That's correct. [00:13:21] Speaker 05: And [00:13:22] Speaker 05: it's very clear when you look at the cases that were cited, both FAA, Cooper, and there's a subsequent case, the Sossaman versus Texas case, that it must be very clearly and unequivocally stated in the text of the statute. [00:13:38] Speaker 05: So whether it's a federal agency or a state agency, the rule is the same. [00:13:41] Speaker 05: WMATA in this case is an instrumentality of the states, and that's undisputed in this jurisdiction. [00:13:49] Speaker 03: If it's possible, I know you don't think it is, but if it's possible for WMATA to waive its immunity, what do you say to the manual as a source of waiver? [00:14:03] Speaker 05: Well, the manual is not a, except for the policy statement. [00:14:07] Speaker 05: And I know Mr. Bartolomucci was careful in his statement about policy. [00:14:12] Speaker 05: The project procedures manual is not a policy statement except for the portion that relates to the policy adopted by the board. [00:14:23] Speaker 05: So the project, the procedures manual as all the provisions that are cited by Schindler were not adopted by the board. [00:14:32] Speaker 05: This is procurement staff making statements. [00:14:36] Speaker 05: And same with the RFP and with the contracting officer's final decisions. [00:14:40] Speaker 05: These are not approved by the board. [00:14:43] Speaker 05: And they are therefore not actions by the board. [00:14:46] Speaker 05: So at most, you would have a situation where the board could take some action. [00:14:51] Speaker 05: But even then, you would have to have some sort of statutory text, according to the case law, both FAA versus Cooper and Sassamon. [00:15:01] Speaker 02: So I think that's the- I'm sorry, some sort of statutory text that gave WMATA the right to waive? [00:15:07] Speaker 05: Statutory text, the only way that there can be any change in Section 80's limited waiver of sovereign immunity is if it were somewhere else in statutory text, and it is not in statutory text. [00:15:20] Speaker 05: And I think Mr. Schindler would like this court to make some new law that WMATA can decide whenever it wants to waive immunity. [00:15:28] Speaker 05: That's not the case. [00:15:30] Speaker 05: And the only example that my friend on the other side is making is that in those situations where Congress specifically requires that in order to receive funds, you have to waive immunity. [00:15:44] Speaker 05: Those situations are completely different than the current situation. [00:15:47] Speaker 05: if, and the Barber case involved receipt of federal funds, as well as the Slack case, a district court case. [00:15:55] Speaker 05: But those are the only two cases that my friend on the other side can cite. [00:16:00] Speaker 05: But the overwhelming authority is that any waiver must be in statutory text. [00:16:06] Speaker 05: And when you look at section 80 and read it in combination with section 81, as this court has said we must do, there is only waiver for contracts in certain tools. [00:16:19] Speaker 02: So can I ask you, in terms of the clarity, because I'm very interested in Mr. Potter-Lemouchy's framing of the compact. [00:16:28] Speaker 02: We don't see a statement in that document in 80 or in 81, I think, that says the authority shall only be liable for its contracts and for its torts. [00:16:42] Speaker 02: The authority is not liable for anything else. [00:16:47] Speaker 02: you know, the states are waiving their immunity only for these particular kinds of claims. [00:16:53] Speaker 02: It just announces that the authority shall be liable for those. [00:16:58] Speaker 02: Mr. Bartolomucci says fine, but there's nothing in here that says that the authority shall not be liable for the kind of claim that I make. [00:17:07] Speaker 02: Why is he wrong about that? [00:17:09] Speaker 05: Because the full sentence says the authority shall be liable for its contracts and its torts. [00:17:16] Speaker 05: committed in the conduct, but shall not be liable for any torts occurring in the performance of a governmental function. [00:17:22] Speaker 05: The exclusive remedy for such breach of contract or torts for which the authority shall be liable shall be a suit against the authority." [00:17:31] Speaker 05: So it does provide that that's the exclusive remedy, and that would have to subsume the contract. [00:17:38] Speaker 02: The exclusive remedy for the claims they're talking about in that paragraph. [00:17:42] Speaker 02: I don't see anything in that paragraph that tells me that the authority could not be liable for something else. [00:17:49] Speaker 02: I just want to make clear that the authority is liable for these things, but why does that necessarily mean that the authority is immune from procurement or other kinds of claims. [00:18:01] Speaker 05: Well, that's what's been decided by this circuit in the past, including in the Morris case. [00:18:06] Speaker 05: So this statute, as it's been written, the compact, as it's been written and applied in this jurisdiction, is that the exclusive, the scope of the waiver is only for contract claims and certain torts. [00:18:21] Speaker 05: So we would be making new law here to the extent we contradict the prior decisions of this court, and that's the precedent of this court. [00:18:31] Speaker 05: But in your honor, there would have been no reason to include the language that's in this section 80 had WMATA been responsible or not liable or not immune from any actions. [00:18:44] Speaker 02: Except the extent that this paragraph is doing the work of explaining that quirky thing about torts, right? [00:18:51] Speaker 02: I mean, you could imagine a world in which if they didn't care about certain torts versus other torts, they wouldn't have said anything and WMATA would be liable for it all. [00:19:00] Speaker 02: But this paragraph is about just making clear that only certain torts. [00:19:05] Speaker 02: Maybe. [00:19:06] Speaker 02: I'm just hypothesizing. [00:19:08] Speaker 05: Then there would have been no reason to include contracts under your theory. [00:19:13] Speaker 05: Fair point. [00:19:18] Speaker 05: So, Your Honor, I [00:19:20] Speaker 05: I know that there are, there was a reference to the unsucked case and I'm happy to answer any questions that you have about that. [00:19:29] Speaker 05: Certainly the DC Circuit when it was hearing the unsucked case was skeptical about the issues in that case. [00:19:37] Speaker 05: I do disagree with my opponent that it is a [00:19:42] Speaker 05: a matter that WMATA can therefore do whatever it wants with respect to waiver. [00:19:49] Speaker 05: In that case, and certainly the record that my friend on the other side has put before the court showed 67 pages of board resolutions after notice and comment, that is very different than the situation here where procurement staff members are issuing a procedures manual or a contracting officer's final decision that is not approved by the board. [00:20:11] Speaker 05: And there has been no decision, obviously, in that unsub case. [00:20:16] Speaker 05: But the fact that section 73 of this compact deals with procurements and protest decisions, and there was no judicial review provided, certainly the jurisdictions knew how to provide for a remedy. [00:20:33] Speaker 05: And they did not do so, as they have done in other statutes. [00:20:37] Speaker 02: And that I'm sorry, can I ask you a different, a slightly different question that stems with stems from judges and tells asking you about the clarity of the potential waiver in the manual and you said, Oh, but this was not written by the board. [00:20:52] Speaker 02: There's not a decision. [00:20:53] Speaker 02: Don't we also have a sort of theories of waiver that can occur based on agency action agents. [00:21:02] Speaker 02: So fine, we don't have the board making the determination, but surely the employees are agents of the WMATA. [00:21:11] Speaker 02: And if the employees are saying in official publications, we say sue us under these circumstances, wouldn't agency theory then allow us to conclude [00:21:23] Speaker 02: that that was at least an implied waiver or that they were attempting to waive under those circumstances? [00:21:30] Speaker 05: Well, I think for a large organization like WMATA, that's hard to apply. [00:21:33] Speaker 05: I do think that's why the rule is that it must be in statutory text. [00:21:38] Speaker 05: So you didn't find a situation where all three jurisdictions are going to be bound by what a WMATA representative puts out. [00:21:47] Speaker 05: It's also and I'm glad Judge sent tell raise the issue of clear and unequivocal if you look at these three statements, they are not clear and unequivocal waiver. [00:21:57] Speaker 05: They are, even if you put aside this issue that it must be in statutory text you don't have a clear and unequivocal waiver. [00:22:04] Speaker 05: The documents that my friend on the other side has put before the court are documents that are very similar to Section 81. [00:22:14] Speaker 05: It just says you go to the federal courts in the three jurisdictions. [00:22:18] Speaker 05: And as a matter of fact, section 81 says all actions and these three documents say for procurement or protest action. [00:22:26] Speaker 05: So it's a way for Schindler to be able to argue that this is somehow different and outside of the compact, but because it needs to be in statutory text and because it needs to be clear and unequivocal, it has not reached that level here. [00:22:41] Speaker 05: It is not clear nowhere in those documents does it say, and WMATA agrees to waive its, [00:22:47] Speaker 05: limited waiver for protest decisions or procurement decisions. [00:22:52] Speaker 05: All it says is if you have a case, you need to go to the court, but it doesn't somehow rule out section 80. [00:23:01] Speaker 05: All right. [00:23:03] Speaker 01: Thank you. [00:23:04] Speaker 01: Mr. Bartolomucci, why don't you take two minutes? [00:23:08] Speaker 04: Thank you, Your Honor, I probably won't need all of that time. [00:23:12] Speaker 04: Couple quick points. [00:23:14] Speaker 04: Number one, my friend is wrong about the assertion that a waiver must be in statutory text. [00:23:21] Speaker 04: FAA versus Cooper is a case about the sovereign immunity of the US government. [00:23:26] Speaker 04: As to the US government, a waiver must be in statutory text. [00:23:30] Speaker 04: But that is not the rule that applies to waivers of state sovereign immunity. [00:23:35] Speaker 04: I've addressed this in my reply brief, and I'll refer you to that. [00:23:39] Speaker 04: And I will also point out, in UNSUC DC Metro, I think that disputes his argument. [00:23:46] Speaker 04: There's no statute that says sovereign immunity is waived as to FOIA-like HAARP claims. [00:23:53] Speaker 04: WMATA just did it on its own. [00:23:56] Speaker 02: Mr. Barnard, aren't you asking us to make new law in light of how this 80 and 81 has traditionally been construed? [00:24:05] Speaker 02: I mean, I hear what Mr. Barnes is saying as consistent with my understanding of what this court and others and the district judges, et cetera, have generally said about the scope of the immunity that WMATA has. [00:24:21] Speaker 02: So it seems quite novel. [00:24:23] Speaker 02: to suddenly say, you know what, 1881 are just talking about courts and contracts, but it doesn't mean that WMATA can't be sued for anything else. [00:24:34] Speaker 02: as long as it waives its immunity. [00:24:36] Speaker 04: Judge Jackson, you're not making new law. [00:24:38] Speaker 04: You're applying Barber, this court's decision in Barber, which all the cases that my friend cites are contract and work cases. [00:24:46] Speaker 04: Barber is a different kind of case. [00:24:48] Speaker 04: And I don't think it even stops to talk about Section 80 because it didn't matter. [00:24:54] Speaker 04: Barber says that a clear declaration is sufficient to waive state sovereign immunity, including [00:25:01] Speaker 04: WMATA's immunity, and it found waiver in that case. [00:25:06] Speaker 04: And here, I think the waiver is clear. [00:25:09] Speaker 04: The PPM says federal district courts, quote, have jurisdiction over court actions concerning protest decisions, end quote. [00:25:21] Speaker 04: What could be clearer? [00:25:24] Speaker 02: What about Mr. Barnes' point that as clear as that may be, it comes from [00:25:30] Speaker 02: an employee and not the board? [00:25:33] Speaker 04: Well, I think I agree with your agency point. [00:25:35] Speaker 04: I think they're bound by their PPM, by their solicitation in this case, by their final decision. [00:25:41] Speaker 04: These are all actions of WMATA and they bind WMATA. [00:25:46] Speaker 04: Mr. Barnes has not cited a single case for the proposition that only the WMATA board can affect a waiver. [00:25:53] Speaker 04: That's something that as far as I can tell, they invented in this case and they've got no authority to support it. [00:26:01] Speaker 01: All right. [00:26:02] Speaker 01: Thank you, gentlemen. [00:26:04] Speaker 01: Madam Clerk, if you'd call the last case.