text:
    Dennis A. WALTERS, Jr., Plaintiff, v. CITY OF ATLANTA, et al., Defendants.
    Civ. A. No. C83-1432A.
    United States District Court, N.D. Georgia, Atlanta Division.
    May 28, 1985.
    Dana E. McDonald, Atlanta, Ga., for plaintiff.

      Kendric E. Smith, Marva Jones Brooks, Overtis Hicks Coopwood, Atlanta, Ga., for defendants.
   ORDER ON MOTION FOR INTERVENTION

SHOOB, District Judge.

This case concerns discrimination in employment on the basis of race and in retaliation for the filing of charges of discrimination and of this lawsuit. A jury found that defendants had violated 42 U.S.C. § 1981 by discriminating against plaintiff in his application to be Director of the Atlanta Cyclorama on account of his race. Serving in an advisory capacity, the jury also found several instances of racial and retaliatory discrimination by defendant City of Atlanta in violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§ 2000e et seq.] the Court, relying largely upon the jury’s advisory verdict, announced at the conclusion of the liability phase of the trial its verdict in favor of plaintiff on the Title VII claims.

On April 4, 1985, the Court announced that it would require defendant City of Atlanta to employ plaintiff in the position from which he was illegally excluded, namely as Director of the Atlanta Cyclorama. On May 17, 1985, Ms. Carole Mumford, who presently serves as Director, moved to intervene and for reconsideration of the Court’s announced decision to install plaintiff in her post. The Court held a hearing on the motion to intervene on May 21, 1985, at which time both the intervention issue and the merits of the prospective intervenor’s claim were addressed.

The Court will deny the motion to intervene for the reasons stated below.

Ms. Mumford moved for intervention as of right under Rule 24(a), Fed.R.Civ.P., or, in the alternative, for permissive intervention under Rule 24(b). The Court considers her claim to be stronger under Rule 24(a); but in either case intervention is unwarranted because Ms. Mumford’s application was untimely, because her interests were vigorously defended by existing parties, and because the Court’s determination would have been identical had she been a party.

Ms. Mumford’s motion to intervene was filed on May 17, 1985, forty-three days after the Court’s announcement, on April 4, 1985, that it would place plaintiff in Ms. Mumford’s position. A forty-three-day delay alone would not cause the Court to find her application to be untimely; but coming, as it did, after a verdict and very shortly before entry of judgment, the delay was prejudicial and therefore untimely. See Annotation, Timeliness of Application for Intervention as of Right under Rule 24(a) of Federal Rules of Civil Procedure, 57 A.L.R.Fed. 150 (1982).

Nor was April 4,1985, the first time that Ms. Mumford knew or should have known that she had an interest in the proceeding. This action has been pending since before Ms. Mumford applied for and obtained the position she now holds. During her tenure as Director of the Cyclorama, she knew of a pending lawsuit over her position. She was invited to, and did attend, a conference with city attorneys and city officials concerning the status of the ease prior to the two-week trial. City lawyers informed her of the plaintiff’s prayer for relief, which included a request to be installed as Director of the Cyclorama, but she relied upon a prediction of the City’s attorney handling the case that the Court was unlikely to order plaintiff placed in her job. Further, Ms. Mumford was aware that a hearing would occur on the instatement question. In sum, Ms. Mumford knew that replacement was an issue in the case but was not a likely outcome. Only when an adverse outcome actually ensued did she become involved in the case.

Those facts cannot support a finding that Ms. Mumford’s application for intervention was timely. Otherwise, any potentially affected party could stand back as long as favorable disposition of the case looked predictable, only to seek leave to participate when the case was already lost.

Furthermore, Ms. Mumford’s interests were vigorously and skillfully defended by the City during the two-week trial, during which time substantial evidence was introduced about her capability and her excellent performance as Director. At the hearing on the motion to intervene, the City’s lawyer stated that he had not conducted the trial with Ms. Mumford’s personal interest in mind. Nevertheless, the City’s excellently conducted, if unsuccessful, opposition to the placement of plaintiff in Ms. Mumford’s post more than satisfactorily represented Ms. Mumford’s interest.

In addition, even had Ms. Mumford participated in the case, the Court’s finding would have been the same. Although Ms. Mumford cited one case from the old Fifth Circuit stating that “bumping” an incumbent from a position was not appropriate, that case does not foreclose the placement of a successful plaintiff in a position that was vacant at the time suit was filed, as in this case. Furthermore, that case did not involve a claim of disparate treatment like the one here. Nor did it involve the “bumping” of an incumbent hired after the lawsuit was instituted who had reason to know of the lawsuit.

On the other hand, Title VII vest[s] broad equitable discretion in the federal courts to ‘order such affirmative action as may be appropriate, which may include, but is not limited to, reinstatement or hiring of employees, with or without back pay ..., or any other equitable relief as the court deems appropriate.

Franks v. Bowman Transportation Co., 424 U.S. 747, 763, 96 S.Ct. 1251, 1263-1264, 47 L.Ed.2d 444 (1976), quoted in Darnell v. City of Jasper, 730 F.2d 653 (11th Cir.1984) (emphasis added). The Eleventh Circuit has established a rule of presumptive reinstatement. See Darnell, 730 F.2d at 655; Allen v. Autauga County Board of Education, 685 F.2d 1302, 1305 (11th Cir.1982). And, as the Eleventh Circuit recently observed,

It is the duty of the district court, after a finding of discrimination, to place the injured party in the position he or she would have been absent the discriminatory actions.

Nord v. United States Steel Corp., 758 F.2d 1462, 1470-71, (11th Cir.1985). Only by placing plaintiff in the position from which he has long been illegally excluded can the Court fulfill that duty.

The Court agrees with all parties- that the decision on placement involves a balancing of equitable interests. Ms. Mumford argues that her very successful 18-month tenure as Cyclorama Director, her abandonment of a long career with the Urban League in order to obtain this position, and her supervision of a number of important projects now underway give her a strong claim to the job. She also points out that she was an innocent party and was not the beneficiary of any decision that involved racial discrimination.

On the other hand, Mr. Walters has been illegally barred from his job as Cyclorama Director since 1981, long before Ms. Mumford became Director. Evidence at trial showed that he reasonably forsook other employment in anticipation of becoming Director of the Cyclorama. Also, Mr. Walters proved that the decision to hire Ms. Mumford, while not racially motivated, constituted illegal retaliation against him for his Title VII charges and suit; as a consequence, Ms. Mumford was the beneficiary of illegal action on the part of the City. Finally, Ms. Mumford made it clear that the City has offered her a lateral move within the City civil service if her job is awarded to Mr. Walters; Mr. Walters has never been accorded such consideration.

After carefully evaluating the merits of the arguments put forth by Ms. Mumford, the Court’s conclusion remains that equity requires that Mr. Walters have the job. As a practical matter Ms. Mumford’s ability to protect her interest has not been impaired.

Because Ms. Mumford’s application for leave to intervene was untimely, because her interests were vigorously and skilfully defended by the City of Atlanta, and because, in light of the Court’s findings, as a practical matter her ability to protect her interest was not impaired by her absence, the Court DENIES Carole Mumford’s application for leave to intervene and for reconsideration.

      . One instance of retaliatory discrimination consisted in the selection of the present Director and Associate Director over plaintiff.

      . The Court recognizes the awkwardness created by the remedy imposed by the Court as a result of defendant City of Atlanta’s racially discriminatory and retaliatory actions, and it desires to minimize any disruption in function of the Cyclorama. The Court observes that the City, in resisting placement of Mr. Walters, was willing to incur costs of "front pay” equal to the economic value of the salary and benefits of the Cyclorama Director, presumably while continuing to employ a Director and Associate Director. Because the City appeared willing to pay three salaries for the work of two employees, the City may prefer not to move Ms. Mumford from the Cyclorama but might, instead, retain her in an associate capacity in order to utilize her proven expertise in promotion and public relations and to forestall possible future litigation. This suggestion is, of course, not mandatory.


source: Caselaw Access Project

author: SHOOB, District Judge.

license: Public Domain

text:
    Dennis A. WALTERS, Jr., Plaintiff, v. CITY OF ATLANTA, et al., Defendants.
    Civ. A. C83-1432A.
    United States District Court, N.D. Georgia, Atlanta Division.
    May 28, 1985.
    Dana E. McDonald, Atlanta, Ga., for plaintiff.
    Kendric E. Smith, Marva Jones Brooks, Overtis Hicks Coopwood, Atlanta, Ga., for defendants.
   JUDGMENT

SHOOB, District Judge.

This action came before the Court and jury with the Honorable Marvin H. Shoob presiding. The issues were tried to the Court upon plaintiff’s claims under Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq., and to the jury under 42 U.S.C. §§ 1981 and 1983. The issues having been tried, the jury having rendered its verdict in plaintiff’s favor on the claims under 42 U.S.C. § 1981, and the Court having found in plaintiff’s favor on the Title VII claims, 610 F.Supp. 715,

IT IS HEREBY ORDERED AND ADJUDGED:

That plaintiff recover of defendants as follows:

а. From defendant City of Atlanta:
1. that the City of Atlanta hire plaintiff Dennis A. Walters, Jr., as Cyclorama Director no later than June 3, 1985, at the salary plaintiff would be receiving now had he been hired on November 1, 1981, namely $24,720 per annum;
2. that it credit Dennis A. Walters, Jr., with all leave (both annual and sick) and all other fringe benefits that would have accrued to plaintiff between November 1, 1981, and the date of instatement,-
3. back pay in the amount of $70,-625.66;
4. prejudgment interest upon the back pay in the amount of $18,903.01;
5. $115,000 in compensatory damages for mental distress from the City’s violation of 42 U.S.C. § 1981;
б. front pay in the amount of $1,366.05 per month commencing April 1,1985, and continuing to the date plaintiff is actually placed in the position of Cyclorama Director;
7. interest upon all amounts specified in 3 through 5 above based upon the applicable post-judgment interest rate, 28 U.S.C. § 1961, commencing April 5, 1985, and continuing until this judgment is satisfied; and
8. a reasonable attorney’s fee to be determined by the Court and costs in this action.
b. From defendant Andrew J. Young in his individual capacity:
1. $10,000 in compensatory damages for mental distress;
2. $2,000 in punitive damages;
3. interest upon the amounts specified in 1 and 2 at the post-judgment interest rate, 28 U.S.C. § 1961, commencing on April 5, 1985, and continuing until the judgment is satisfied; and
4. a reasonable attorney’s fee to be determined by the Court and costs in this action.
c. From defendant Shirley C. Franklin in her individual capacity:
1. $10,000 in compensatory damages for mental distress;
2. $2,000 in punitive damages;
3. interest upon the amounts specified in 1 and 2 at the post-judgment interest rate, 28 U.S.C. § 1961, commencing on April 5, 1985, and continuing until the judgment is satisfied; and
4. a reasonable attorney’s fee to be determined by the Court and costs in this action.
d. From defendant Clara G. Axam in her individual capacity:
1. $5,000 in compensatory damages for mental distress;
2. $1,000 in punitive damages;
3. interest upon the amounts specified in 1 and 2 at the post-judgment interest rate, 28 U.S.C. § 1961, commencing on April 5, 1985, and continuing until the judgment is satisfied; and
4. a reasonable attorney’s fee to be determined by the Court and costs in this action.
e. From defendant Geraldine G. Elder in her individual capacity:
1. $9500 in back pay (joint and several liability with the City of Atlanta);
2. $10,000 in compensatory damages for mental distress;
3. $2,000 in punitive damages;
4. interest upon the amounts specified in 1 through 3 at the post-judgment interest rate, 28 U.S.C. § 1961, commencing on April 5, 1985, and continuing until the judgment is satisfied;
5. a reasonable attorney’s fee to be determined by the Court and costs in this action.

      . The City is jointly and severally liable with defendant Geraldine Elder for $9500 of that sum.


text:
    Dennis A. WALTERS, Jr., Plaintiff, v. CITY OF ATLANTA, et al., Defendants.
    Civ. A. No. C 83-1432A.
    United States District Court, N.D. Georgia, Atlanta Division.
    May 28, 1985.
    Dana E. McDonald, Atlanta, Ga., for plaintiff.
    Kendric E. Smith, Marva Jones Brooks, Overtis Hicks Coopwood, Atlanta, Ga., for defendants.
   ORDER

SHOOB, District Judge.

Defendant City of Atlanta has orally moved for a stay of this Court’s decision 610 F.Supp. 715 and 610 F.Supp. 733 to place plaintiff in the position of Director of the Atlanta Cyclorama pending the City’s appeal of this case to the United States Court of Appeals for the Eleventh Circuit.

This case is approaching the end of its second year. A jury and the Court independently found that plaintiff was the victim of repeated acts of illegal discrimination. Since plaintiff has been illegally denied the job for three and one-half years, and as this Court’s duty under Title VII is to award plaintiff the position he would have had three and one-half years ago but for the illegal discrimination, the Court DENIES the motion of defendant City of Atlanta for a stay pending appeal.


author: JAMES R. MILLER, District Judge.

text:
    Raymond R. BRADY and Raye Corporation v. The HARTFORD FIRE INSURANCE COMPANY, and William Gutgesell and East Coast Salvage Company, Inc.
    Civ. A. No. M-79-2392.
    United States District Court, D. Maryland.
    May 28, 1985.

      Joseph F. Lentz, Jr., William D. Hooper, Jr., and Lentz, Hooper, Jacobs & Blevins, P.A., Baltimore, Md., for plaintiffs.
    Jon H. Grube, John J. Boyd, Jr., Raymond G. Mullady, Jr., and Smith, Somerville & Case, Baltimore, Md., for defendant The Hartford Fire Ins. Co.
    George H. Hulse and Hulse & Germano, Burlington, N.J., for defendant William Gutgesell.
    James W. Bartlett, III, JoAnne Zawitoski, and Semmes, Bowen & Semmes, Baltimore, Md., for defendant East Coast Salvage Co., Inc.
   MEMORANDUM AND ORDER

JAMES R. MILLER, District Judge.

The trial in this diversity case began on September 27, 1982. On October 12, 1982, this court granted the motion for a directed verdict in favor of Hartford Fire Insurance Co. and William Gutgesell, two of the defendants. The case proceeded against East Coast Salvage Company, and on October 15, 1982 the jury entered a verdict for the plaintiff, Raye Corporation, against East Coast Salvage for $3,411.35. Subsequently, the plaintiffs appealed and the Fourth Circuit affirmed this court’s decision. See Brady v. The Hartford Fire Insurance Co., 746 F.2d 1470 (4th Cir.1984) (unpublished).

All defendants have filed motions for attorney’s fees and the plaintiffs have responded. A hearing on the matter was held on February 22, 1985. Counsel for East Coast Salvage and Hartford Insurance Co. were present. Counsel for Mr. Gutgesell did not attend the hearing. The court, after hearing argument, requested supplemental memoranda on the effect of Md. R. 1-341 on this case.

A) Legal Principles Applicable

In a diversity case “ ‘where the state law does not run counter to a valid federal statute or rule of court, and usually it will not, state law denying the right to attorney’s fees or giving a right thereto, which reflects a substantial policy of the state, should be followed.’ ” Alyeska Pipeline Co. v. Wilderness Society, 421 U.S. 240, 259 n. 31, 95 S.Ct. 1612, 1622 n. 31, 44 L.Ed.2d 141 (1975) citing 6 J. Moore, Federal Practice f 54.77[2] pp. 1712-1713 (2d ed. 1974). Under Maryland law:

“In any civil action, if the court finds that the conduct of any party in maintaining or defending any proceeding was in bad faith or without substantial justification the court may require the offending party or the attorney advising the conduct or both of them to pay to the adverse party the costs of the proceeding and the reasonable expenses, including reasonable attorney’s fees, incurred by the adverse party in opposing it.”

Md.Rule 1-341 (1984).

Although under previous Md.R.P. 604(b) a finding of bad faith or lack of substantial justification mandated an award of attorney’s fees, see, e.g., Hess v. Chalmers, 33 Md.App. 541, 545, 365 A.2d 294 (1976), the new Md.Rule 1-341 does not mandate the award, but leaves the granting of such award to the discretion of the court. Compare Md.R.P. 604(b) with Md. Rule 1-341. The initial question for the court, however, is whether 1) the conduct of any party in maintaining the action was in bad faith or 2) whether the action was without substantial justification.

In determining whether a case has been litigated without substantial justification, Maryland appellate courts have reviewed the facts, the law, and the circumstances of each case in which the issue has been raised to ascertain whether there was at least some basis in law or fact for the action of the potential offender.

For example, in denying a motion for reargument on appeal, the Court of Appeals of Maryland commented that although the plaintiff was free to institute a new action under the applicable Maryland statute, that statute did not appear to support the plaintiff’s position. The court advised the plaintiff “to be certain before instituting such action that it has ‘substantial justification’ for the action in order that it may not be ensnared in Maryland Rule 604(b) ... and thus become responsible for ‘the reasonable expenses incurred by the adverse party in opposing such proceeding____’” Clinton Petroleum Services, Inc. v. Norris, 271 Md. 665, 673, 321 A.2d 528 (1974) (citations omitted).

The plaintiffs in Singer v. Steven Kokes, Inc., 39 Md.App. 180, 384 A.2d 463 (1978), did become ensnared in Rule 604(b) and were held responsible for opposing counsel’s attorney’s fees. They argued on appeal that their cause of action “was supported by plausible legal arguments,” id. at 186, 384 A.2d 463, but the court did not agree stating, “The arguments ... were totally devoid of any merit and in light of the circumstances surrounding this case we can see no basis for setting aside the award of attorney’s fees.” Id. See also Suit-land Development Corporation v. Merchants Mortgage Co., 254 Md. 43, 46, 254 A.2d 359 (1969) (allegations in complaint unsupported by the evidence; evidence completely vindicated each and every defendant of all charges; attorney’s fees awarded); Attorney Grievance Comm’n v. A.S. Abell Co., 294 Md. 680, 689-90, 452 A.2d 656 (1982) (defendant’s motion raising preliminary objection had no basis in law; attorney’s fees award upheld); Shanks v. Williams, 53 Md.App. 670, 672-73, 455 A.2d 450 (1983) (plaintiff’s attempt to rehash matters already decided was merit-less; attorney’s fees award upheld).

The Court of Special Appeals has cautioned that “ ‘without substantial justification’ should not be interpreted to mean that the winning party is entitled to counsel fees simply because his opponent misconceived the legal basis upon which he sought to prevail.” Hess v. Chalmers, 33 Md.App. at 545, 365 A.2d 294. The facts of Hess reveal, however, that at least at the time the plaintiff instituted the action there was some justification for doing so.

The plaintiffs, in opposition to the defendants’ requests for fees and costs, cite Dent v. Simmons, 61 Md.App. 122, 485 A.2d 270 (1985), in which the Court of Special Appeals found that a party presenting a new cause of action to the court should not be penalized by having to pay attorney’s fees simply because the cause of action was not recognized in Maryland. In Dent, however, the court recognized that the plaintiff’s cause of action had been recognized in other jurisdictions, id. at 128 n. 5, 485 A.2d 270, had not been rejected specifically in Maryland, id. at 128, 485 A.2d 270, and that “[a] litigant ought not to be penalized for innovation or exploration ... unless such exploration is frivolous.”

Id.

In summary, to hold the plaintiffs and/or their counsel responsible for attorney’s fees and costs, this court must conclude that there was no basis in law and/or fact to support their claims against the defendants seeking the fees and costs.

B) This Court’s Findings in Brady v. Hartford Fire Insurance

On October 12, 1982, this court issued a memorandum and order setting forth the reason for its directed verdict in favor of Hartford Fire Insurance Co. and William Gutgesell. In the memorandum the court repeatedly stated that there was no basis in fact or law to support the plaintiffs’ case against those two defendants.

Trial began on September 27, 1982, and after five days of hearing plaintiffs’ case, as the court stated in the memorandum:

“The theory of the plaintiffs as to liability was finally made clear by the memorandum of law filed with the court on or about October 5, 1982.”

(Paper No. 81 at 2).

Regarding that legal argument as to Hartford’s liability, the court stated:

“Plaintiffs’ entire argument as to Hartford’s liability is based upon the faulty premise contained in the first sentence of the plaintiffs’ memorandum of law under the heading ‘Summary of Facts.’ There the plaintiffs state that, under the insurance policy, The Hartford had ‘the option of declaring the vessel a total loss, or to salvage and repair same.’ There is no basis in fact or in law to support such an assertion.
No clause in the policy gives The Hartford the option of declaring the vessel a total loss. Rather, under the law construing such policies, before the vessel owner can recover the full value under the policy as a ‘constructive total loss’ the owner must first affirmatively abandon all his interests in the vessel to the insurer.”

(Id.) (citations omitted).

“The eases cited by the plaintiffs in their memorandum of law are factually inapplicable to the present case. The cases cited by the plaintiffs involve the application of state law to automobile or fire insurance policies, all of which contain an express provision giving the insurer a right to undertake repairs on the insured property in lieu of merely paying for the repairs. None of the cases cited by the plaintiffs involve a marine insurance policy where no right to undertake repairs was conferred in the policy.”

(Id. at 5).

Regarding the plaintiffs’ evidence at trial as to Hartford Fire Insurance Co.’s liability, the court concluded:

“Plaintiffs’ assertion that The Hartford ‘elected’ to undertake repairs on the PATTI B and that plaintiffs did not have the right to question the decision, plaintiffs’ memorandum at 3, is totally contrary to the facts produced in evidence and the law.”

(Id. at 6).

“The evidence in this case, however, totally negates any assumption by Hartford of an obligation to repair the vessel. Captain Brady’s unsupported conclusory allegation that his role in the repairs of the PATTI B was a mere ‘formality’ is at odds with the evidence.”

(Id. at 8).

“The assertion in the plaintiffs’ memorandum that the plaintiffs demanded that The Hartford pay the full value of the policy ‘on several occasions beginning immediately after the sinking of the PATTI B’ is totally unsupported by the evidence.”

(Id. at 6).

“In short, there is no evidence that Hartford breached its contract of insurance, nor any warranty made by it, nor that it assumed any obligation to repair, based on the insurance policy or otherwise.”

(Id. at 10).

The court in its memorandum also commented on the evidence against Mr. William Gutgesell by stating:

“The plaintiffs have also sued William Gutgesell on the theory that he made certain warranties to Captain Brady or Raye Corporation and that he performed duties assumed by him in a negligent fashion.
There is no evidence that William Gutgesell made any warranties to Captain Brady or to Raye Corporation. He never promised Captain Brady that the repairs would be completed at any particular time. He never warranted the quality of the work of East Coast Salvage Company. He did approve the work on behalf of Hartford, which was done by East Coast Salvage Company, but the evidence is clear that Captain Brady approved it also as the latter had the right to do, on behalf of Raye Corporation, under the contracts signed with East Coast Salvage Company. In any event, it. is clear that neither of the plaintiffs had any contractual relationship with William Gutgesell. Captain Brady was definite in his testimony that he did not look upon William Gutgesell as his representative, but, instead, as a representative of Hartford.
For the reasons previously stated, it is also apparent that Mr. Gutgesell did not himself assume the obligation of repairing the PATTI B. He had no duty to Captain Brady or the Raye Corporation which could possibly form the basis for any liability to them for alleged negligence.”

{Id. at 10).

The inescapable conclusion regarding the plaintiffs’ case against both Hartford and Gutgesell is that it had no basis in law or fact. The plaintiffs may argue that they were attempting to present a new cause of action, but that argument is meritless. As pointed out by this court, the law applicable to the plaintiffs’ claims was clear and well settled (Paper No. 81 at 2). If a new cause of action was presented to this court, it was a “frivolous one — i.e., it indisputably had no merit.” Dent v. Simmons, 122 Md.App. at 128 n. 3, 485 A.2d 270.

Against East Coast Salvage, however, the plaintiffs had a colorable, but very limited, claim. Specifically the court stated:

“As to East Coast Salvage Company, the evidence is clear that Raye Corporation contracted directly with it for the partial repair, as well as for the raising, of the PATTI B. No claim is made in this case that the raising of the PATTI B was done by East Coast in an improper or negligent fashion.
The evidence discloses that Captain Brady on behalf of the Raye Corporation had the right to approve the workmanship and prices of East Coast and that he did so. He inspected the vessel before the final East Coast bill was paid. He approved the concept of awarding the work to East Coast in stages. He conceded on cross-examination that the last stage of the work performed by East Coast, not having been awarded until December of 1978 or January of 1979, eliminated any effect of alleged delay in repairs by East Coast which may have previously taken place. He produced no evidence to show when the last work was completed by East Coast on the PATTI B, but it is clear that the PATTI B sat for several months in the yard of East Coast after East Coast had completed all of its work.
Raye Corporation, through R & M Welding and Captain Brady, has received payment from Hartford for most of the items which the plaintiffs contend had to be redone by Captain Brady because of alleged improper workmanship by East Coast.
East Coast obviously had no control, under the evidence, over any delays which occurred or the workmanship which was performed in connection with repairs of the PATTI B after Captain Brady ordered the vessel removed to the Camden Ship Repair yard in May, 1979.
Under the evidence in this case, the liability, if any, of East Coast is limited as a matter of law to the items which Captain Brady testified were improperly done by East Coast for which Captain Brady and Raye Corporation have not heretofore received payment by The Hartford.”

(Id. at 10-11).

The jury returned a verdict for plaintiff Raye Corporation in the sum of $3,411.35. Thus against East Coast Salvage the plaintiffs’ claim, as limited and defined by the court, had some basis in law and fact.

C) Fourth Circuit’s Findings in Brady v. Hartford Fire Insurance Company

The Fourth Circuit affirmed this court’s decision to grant a directed verdict for Hartford and Gutgesell. In affirming, the court stated, “We agree with the district court that neither the facts nor the law supports [the plaintiffs’] claim.” Brady v. Hartford Insurance Co., 746 F.2d 1470, slip op. at 3-4 (4th Cir.1984).

In summary, both this court and the Fourth Circuit found that there was no basis in law or fact for the claims against Hartford and Gutgesell. Therefore, this court will exercise its discretion and award reasonable attorneys’ fees to those parties.

As to East Coast Salvage, although the plaintiffs misconceived the scope of their claim against East Coast Salvage, there was some justification for that claim. Therefore, East Coast Salvage’s request for attorney’s fees will be denied.

D) Reasonableness of the Fee Request

Maryland law requires that the award of attorney’s fees be reasonable, see Md. Rules 1-341, but little guidance is given in Maryland cases regarding reasonableness in calculating the award. Therefore, this court will utilize the procedure adopted by the Fourth Circuit to calculate attorney’s fee awards.

Pursuant to Fourth Circuit law, the court initially will analyze the time and labor required to determine whether the hours spent were reasonable. It will multiply the hours reasonably spent by a reasonable hourly rate. That figure represents the “preliminary award.” See, e.g., Disabled in Action v. Mayor and City Council of Baltimore, 685 F.2d 881, 886 (4th Cir.1982); Anderson v. Morris, 658 F.2d 246, 249 (4th Cir.1981). After determining the preliminary award, the court will use the factors set forth in Johnson v. Georgia Highway Express, Inc., 488 F.2d 714 (5th Cir.1974), to enhance or decrease the preliminary award, if appropriate. See Anderson v. Morris, 658 F.2d at 249. This approach was approved and utilized by the Supreme Court in Hinsley v. Eckerhart, 461 U.S. 424, 103 S.Ct. 1933, 76 L.Ed.2d 40 (1983).

1) Hartford’s Request

Hartford has submitted several exhibits to the court which detail the hours spent on this case from January, 1980 to October, 1984 by four different attorneys. Hartford claims that it is entitled to $77,246.99 in attorneys’ fees. It appears that $48,988.60 of that amount is compensation sought for fees and expenses of Phillip L. Goldsborough, Esq.; Jon H. Grube, Esq.; John J. Boyd, Esq., and Raymond G. Mullady, Esq. incurred in litigating this matter before this court. The remaining amount, $28,-258.39, is sought for fees and expenses incurred on appeal by Jon H. Grube, Esq.; John J. Boyd, Esq.; Raymond G. Mullady, Esq.; Judith Bollinger, Nicole Popoli, and Angela Beavers, who apparently are paralegals.

Initially, because the Fourth Circuit merely affirmed this court’s decision without determining whether these defendants should be awarded attorneys’ fees pursuant to 28 U.S.C. § 1912 or Fed.R.App.P. 39, this court declines to consider the propriety or reasonableness of the request for attorneys’ fees on appeal.

After reviewing each item set forth in Exhibit 2, it appears to this court that the 770 hours spent in preparing for and litigating this action before this court are a reasonable expenditure of time. Numerous depositions were taken, and discovery disputes abounded caused by plaintiffs’ untimely responses or non-responsiveness to discovery requests. A protracted trial ensued. Although some of the hours tallied reflect time spent dealing with cross claims, those cross claims were directly attributable to the plaintiffs’ action and thus are compensable in the opinion of this court.

The rates charged for each of the four persons working on the case are also reasonable within this community. Mr. Grube, a partner at Smith, Somerville and Case, charged $70 per hour for 159.2 hours. Mr. Boyd, an associate at the same firm, charged $60 per hour for 494.0 hours and Mr. Mullady, now an associate with the firm, but who at the time of this litigation was a law clerk, charged $25 per hour for 94.4 hours. Mr. Goldsborough, a senior partner in the firm, charged $80 per hour for 22.4 hours of time.

Therefore, the $44,936.00 in attorneys’ fees requested appears reasonable. In addition, the $4,052.60 in expenses, which apparently includes travel to Camden, New Jersey to attend depositions scheduled by the plaintiff or to interview witness-employees of East Coast Salvage concerning their knowledge of repairs to the PATTI B, also appears reasonable.

Therefore, the court will turn to the factors set out in Johnson v. Georgia Highway Express, Inc., 488 F.2d 714 (5th Cir.1974). Those factors include “skill required; contingency of fee; amount involved and result attained; experience and ability of counsel; awards in similar cases ... novelty and difficulty of questions; time limitations____” Blankenship v. Schweiker, 676 F.2d 116, 118 (4th Cir.1982).

Trial counsel were skilled and experienced and performed well under the confusing circumstances of this case. Once the plaintiffs’ legal theories became clear, and that was not until well after the trial began, no novel questions were involved. The case turned on the insurance policy’s language and the responsibilities of Hartford under that policy. Those factors are neutral, in this court’s opinion.

There is no contingency fee factor to consider.

Comparing this award to awards in similar cases is difficult at best. This case is “similar” to very few before this court. Its length and initial complexity were caused by the plaintiffs’ failure to respond to discovery or to clarify the legal basis for their claims. Within the circumstances of this case, the fees requested are particularly appropriate. They need not be enhanced or decreased, however.

2) Gutgesell’s Request

Mr. George Hulse, attorney for Mr. Gutgesell, on March 9, 1985 submitted an affidavit and documentation requesting $20,498 in attorney’s fees plus $685.19 in costs (Paper No. 93 Attachment). The plaintiff, by letter of March 13, 1985, objected to the court’s considering such documentation arguing that it was untimely filed. The court notes that Mr. Gutgesell’s motion for attorney’s fees was filed timely and long ago in this ease (see Paper No. 93). The recent affidavit and documents merely set forth the fees requested, and it is for the court to determine whether the fee request is reasonable within the guidelines set forth by the Fourth Circuit as described supra.

This court has reviewed the documentation supporting the fee request. That request shows that George Hulse, attorney for William Gutgesell, spent approximately 179.6 hours at $60 per hour on pre-trial matters. An additional 15.2 hours at $40 per hour in paralegal time were spent in pre-trial preparation. Given the number of depositions taken and the discovery problems which occurred in this case, the time expended appears reasonable as do the hourly rates.

Also reasonable is the request for a fee of $750 per day for each day of trial — i.e., 11 days from the start of trial to directed verdict for Mr. Gutgesell. Finally, post-trial review and filing of attorney’s fees motions consumed 14.4 hours of Mr. Hulse’s time at $60 per hour. That figure is reasonable.

The rates charged for attorney and paralegal time are inherently reasonable and comparable to the rates charged by attorneys in the community and in this case.

Therefore, the request for $20,498 in attorney’s fees represents a reasonable request. In addition, the $615.19 in costs, representing copying costs, Federal Express costs, and reimbursement of expenses of George Hulse, also appears reasonable.

Turning to the Johnson factors to determine whether the preliminary award of $21,183.19 should be enhanced or decreased, the court believes that the factors should be applied neutrally. As explained in the previous section of this memorandum, trial counsel were skilled, but no novel questions of law were presented in this case. Within the circumstances of this case, the fee request is appropriate.

E) Persons Responsible to Pay Fee Award

This case was filed on December 27, 1979. It went to trial in October, 1982. After the verdicts were rendered, an appeal was taken. Argument at the Fourth Circuit occurred on April 4, 1984 and that appellate court rendered its decision on October 5, 1984. This court scheduled argument on the attorney fees issue for February 22, 1985.

An issue arose at the hearing on this matter regarding the applicability of Maryland Rule 1-341 in this case. That rule became effective on July 1,1984 and allows a court to require “the offending party or the attorney advising the conduct or both of them to pay the adverse party ... reasonable expenses, including reasonable attorney’s fees incurred by the adverse party....” Md.R. 1-341.

Prior to July 1, 1984, however, attorney fees issues were governed by Md.R.P. 604(b) which did not allude to the imposition of an award against counsel.

On April 6, 1984, however, the Court of Appeals of Maryland, in passing an Order adopting the new Maryland Rules of Practice and Procedure, stated:

“The Rules, Forms and Amendments hereby adopted by this Court shall govern the Courts of this State and all parties and their attorneys in all actions and proceedings, and shall take effect and apply to all actions commenced on or after July 1, 1984, and insofar as practicable, to all actions then pending ...”

As is apparent, Maryland law changed during the pendency of the appeal exposing attorneys to the possibility of having to pay an opponent’s attorney’s fees. The plaintiffs’ Attorney argues herein that application of Md.R. 1-341 in this case would be retrospective, inappropriate and not practicable. What is meant by the term “insofar as practicable” has not been addressed in any detail by Maryland courts. In this type of case, however, some guidance can be found in cases from other jurisdictions in which attorney’s fees statutes were applied to cases pending at the time the statute became effective.

For example, the civil rights attorney’s fees statute, 42 U.S.C. § 1988, has been held to apply to cases pending at the time the statute was passed, see, e.g., Hutto v. Finney, 437 U.S. 678, 694 n. 23, 98 S.Ct. 2565, 2575 n. 23, 57 L.Ed.2d 522 (1978), even when the only issue remaining unresolved was the attorney’s fees issue. Rainey v. Jackson State College, 551 F.2d 672, 676 (5th Cir.1977). As the court pointed out in Rainey, Congress had intended that the attorney’s fee act apply to all cases, id. at 675, and that the general rule is that a court “apply the law in effect at the time it renders a decision, unless doing so would result in manifest injustice or there is statutory direction or legislative history to the contrary.” Id. at 676.

A similar analysis can be applied to interpret the meaning of the order of the Maryland Court of Appeals that the new rules of procedure apply to all actions pending “insofar as practicable.” The intent to apply the attorney’s fees rule to pending actions is clearly stated in the April 6, 1984 Order of the Court of Appeals.

With that intent in mind, the term “insofar as practicable” can be equated to some extent with the .term “unless doing so would result in manifest injustice.” Of course, impracticability and manifest injustice are not synonymous terms, but if application of Md.R. 1-341 would unfairly affect rights of an attorney it surely would be impracticable to apply the rule in this pending case. Impracticability describes unwise, imprudent actions. Webster’s Third New International Dictionary at 1136 (1966). Therefore, the question in this ease is whether it would be unwise or imprudent to apply Md. R. 1-341 in this action because to some extent such application would represent an injustice to the attorney herein. For example, if unfair surprise would occur or if an attorney were deprived of a right he previously had under Md.R.P. 604(b), application of Md. R. 1-341 could be deemed impracticable.

Unfair surprise can hardly be an issue herein. Attorneys are exposed to sanctions of all kinds when they come before the court and their conduct is deemed improper. Courts possess inherent and statutory power to assess attorney’s fees for disobedience of a court order, bad faith litigation, discovery abuses, and delay in litigation, to name a few. See, e.g., Roadway Express, Inc. v. Piper, 447 U.S. 752, 766, 100 S.Ct. 2455, 2464, 65 L.Ed.2d 488 (1980); Alyeska Pipeline Co. v. Wilderness Society, 421 U.S. 240, 258, 95 S.Ct. 1612, 1622, 44 L.Ed.2d 141 (1975); Blair v. Shenandoah Women’s Center, Inc., 757 F.2d 1435 (4th Cir.1985) (unpublished); 28 U.S.C. § 1927; Fed.R.Civ.P. 11; Fed.R.Civ.P. 37; Md.R.P. 406(c) (old rule setting discovery abuse sanctions including imposition of attorney’s fee against counsel). It can be no surprise to plaintiffs’ attorney that he could be held responsible for his improper conduct before a court. The requirement of payment of attorney’s fees has been one way to implement such responsibility and to assist the court in the control of the conduct of litigation. As the Supreme Court has stated, “the power of a court over members of its bar is at least as great as its authority over litigants.” Roadway Express, Inc. v. Piper, 447 U.S. at 766, 100 S.Ct. at 2464. There can be no unfair surprise in requiring counsel to pay attorney’s fees.

The plaintiffs argue that the “creation of a new liability on the part of an attorney” is, in essence, the creation of a new cause of action which, because it is a substantive matter, cannot be applied in this case retroactively.

It is true that in matters of substance, laws will not be given retrospective operation. See Wittel v. Baker, 10 Md.App. 531, 539, 272 A.2d 57 (1970). This court, however, does not consider the question of who will pay attorney’s fees a matter of substance. When a court imposes a rule which is designed to control the conduct of the litigation and the counsel appearing before the court, it is the opinion of this court that such a matter is procedural. Its effect is to “streamline the litigation process by lessening frivolous claims and defenses.” Fed.R.Civ.P. 11, Notes of the Advisory Committee on Rule (1983). Imposition of attorney’s fees awards against counsel is but one tool in the hands of the court by which it can control its docket.

Thus, even assuming that imposition of attorney’s fees against plaintiffs’ counsel in this case is a retrospective application of Md.R. 1-341, that rule neither creates a new substantive right in the defendant nor deprives plaintiffs’ attorney of a right which existed previously. It affects matters governing this court’s power over counsel in a procedural way. It is not impracticable to apply Md.R. 1-341 to this action, pending at the time the rule went into effect.

Other courts have applied attorney’s fees rules to sanction conduct which preceded the rules’ effective date. In Herrara v. Farm Products, 540 F.Supp. 433 (N.D.Iowa 1982), the court summarily addressed the plaintiff’s counsel’s argument that he could not be held responsible to pay attorney’s fees incurred because of his conduct occurring prior to the effective date of 28 U.S.C. § 1927 which established that attorney’s fees could be awarded against offending counsel. Id. at 436 n. 4. The court found no merit in the argument and awarded fees because the case was pending when the statute became effective.

In Blair v. Shenandoah Women’s Center, Inc., 757 F.2d 1435 (4th Cir.1985) (unpublished), the lower court imposed attorney’s fees against an attorney for bad faith, dilatory tactics and frivolous legal arguments noting that it had the inherent power to do so and statutory power under Fed.R.Civ.P. 11. Id., at 1436. Federal Rule of Civil Procedure 11 as amended, the Fourth Circuit noted, did not become effective until after the conduct at issue had occurred. Id., at 1436-1437. The Fourth Circuit emphasized that Rule 11, as amended in 1983, was designed “ ‘to streamline the litigation process by lessening frivolous claims or defenses.’ ” Id., at 1437. Although the lower court’s finding of bad faith alone could have supported the award of attorney’s fees against counsel, the court of appeals did not find fault with applying amended Rule 11 to conduct which preceded its effective date.

Neither of those cases examined the restrospectivity issue, but both cases demonstrate that application of an attorney’s fees statute or rule to a pending action is hardly unusual.

Therefore, this court concludes that plaintiffs’ counsel may be exposed to liability for attorney’s fees in this action. Plaintiffs need not bear alone the burden of paying over $69,000 in attorney’s fees and costs incurred in protracted litigation which had no substantial justification.

Accordingly, it is this 28th day of May, 1985, by the United States District Court for the District of Maryland, ORDERED:

1) That the motion of Hartford Fire Insurance Company for attorneys’ fees and expenses is GRANTED for a total of $48,-988.60.

2) That the motion of William Gutgesell for attorney’s fees and expenses is GRANTED for a total of $21,183.19.

3) That the award is assessed jointly and severally against Raymond R. Brady, Raye Corporation, and Joseph F. Lentz, Jr., Esquire.

4) That the motion of East Coast Salvage for attorneys’ fees is DENIED.

5) That the Clerk mail a copy of this Memorandum and Order to counsel for the parties.

      . Paper No. 87 — East Coast Salvage, Motion for Costs & Expenses.
      Paper No. 88, 102, 107 — Hartford Insurance, Motion for Attorney's Fees.
      Paper No. 93 — William Gutgesell, Motion for Attorney’s Fees
      Paper Nos. 95, 96, 98, 110 — Plaintiffs’ Response

      . Md. Rule 1-341 supersedes Md.R.P. 604(b) which read:
      "In an action or part of an action, if the court finds that any proceeding was had (1) in bad faith, (2) without substantial justification, or (3) for purposes of delay the court shall require the moving party to pay to the adverse party the amount of the costs thereof and the reasonable expenses incurred by the adverse party in opposing such proceeding, including reasonable attorney’s fees."

      . Considering all the facts and circumstances in this case, this court declines to find that the conduct of the plaintiff in maintaining the action was in bad faith.

      . In Hess, the plaintiffs were unsuccessful in an action in Anne Arundel County Circuit Court regarding property they claimed to be entitled to in Anne Arundel County. They appealed the trial court’s decision. During the pendency of that appeal, they instituted an action in Baltimore County regarding their entitlement to land in Baltimore County asserting the same legal theory as they had argued in the Anne Arundel County Court. While that case was pending, their appeal from the Anne Arundel County case was dismissed as being filed late. 33 Md.App. at 542-43, 365 A.2d 294. The Baltimore County court found, then, that the Anne Arundel County action was res judicata as to the claim before it. Id. at 543, 365 A.2d 294. The appellate court found that ”[t]he fact they may have been overly confident of their position on appeal and filed the Baltimore County bill of complaint while the appeal was pending, does not mean that it was done ‘without substantial justification’ within the meaning of Rule 604(b)." Id. at 546, 365 A.2d 294.

      . Mr. Gutgesell filed a cross claim for contribution against Hartford (Paper No. 6) which Hartford answered (Paper No. 8). Hartford also considered, but did not file, a cross claim against East Coast Salvage Co. The time spent by Hartford’s counsel conferring with East Coast Salvage appears to this court to be related to its defense of the plaintiffs’ "repair” claims.

      . Impracticability also is defined as an incapability of performing or accomplishing a goal given the means available. That meaning of the term would be applicable in a case in which the application of one of the new rules of Maryland procedure would confuse, complicate, or obstruct the resolution of a case.


author: SCOTT O. WRIGHT, Chief Judge.

text:
    ALCOLAC, INC., Plaintiff, v. David A. WAGONER, Director of Air & Waste Management Div., Region VII; David R. Tripp, Regional Counsel: Rowena L. Michaels, Freedom of Information Officer, Region VII; United States Environmental Protection Agency, Defendants.
    No. 84-0827-CV-W-5.
    United States District Court, W.D. Missouri, W.D.
    May 28, 1985.

      Alvin Shapiro, Kansas City, Mo., H. Gregory Skidmore, Carscaden, Gilchrist & Getty, Cumberland, Md., for plaintiff.
    Eugene Harrison, Asst. U.S. Atty., Kansas City, Mo., for defendants.
   ORDER

SCOTT O. WRIGHT, Chief Judge.

Plaintiff has filed a complaint in this Court seeking “judicial review” of a final administrative decision of the Environmental Protection Agency (EPA) denying confidentiality to documents submitted to the EPA. Plaintiff maintains the EPA’s refusal to declare said documents confidential is arbitrary, capricious, and an abuse of discretion. Plaintiffs complaint seeks declaratory and injunctive relief, and further maintains that disclosure of this information would violate 18 U.S.C. § 1905 (Trade Secrets Act).

This action now pends on cross-motions for summary judgment. The facts material to this Court’s review of the EPA confidentiality determination are not in dispute. Indeed, the determination was (necessarily) made upon facts submitted to the agency by plaintiff’s attorney. For the following reasons, the Court will grant defendants’ motion for summary judgment.

Background

Alcolac is a Maryland corporation organized and existing under the laws of Maryland, with a principal place of business therein. Alcolac maintains and operates manufacturing facilities for the production and sale of specialty chemical products in Sedalia, Missouri. Defendants are all employed by the United States Environmental Protection Agency, which is also a named defendant.

As part of a request for a hazardous waste facility permit, filed under the Resource Conservation and Recovery Act (RCRA), 42 U.S.C. § 6901 et seq., plaintiff was required to complete and return to the EPA a “Part B” application. In making said application, however, plaintiff asserted a claim of business confidentiality by marking portions of the application “company confidential.” See 40 C.F.R. § 2.203(b). Such a claim, if sustained, protects the application or information contained therein from disclosure under the Freedom of Information Act (FOIA). See 5 U.S.C. § 552(b)(4). Plaintiff’s application was also the subject of a FOIA request filed by Kansas City attorney Charles W. Fairchild. The release was denied pending resolution of the confidentiality claim, See 40 C.F.R. § 2.204(d)(l)(ii). The FOIA request, however, has since been withdrawn.

A business submitting information to the Environmental Protection Agency may assert a claim of business confidentiality in order to prevent disclosure of the information. The EPA may also be forced to determine the entitlement to such a privilege in a number of other circumstances: (1) in response to a FOIA request, (2) by claim of the submitting party, or (3) by the agency’s own initiative in certain situations. See 40 C.F.R. 2.203(b). Placing on, or attaching to, the information a coversheet stamped “trade secret” or “company confidential,” raises the claim of confidentiality. 40 C.F.R. § 2.203(b).

Although the EPA makes a preliminary determination as to the propriety of the confidentiality claim, the affected business must be given the opportunity to submit comments in support of their claim. 40 C.F.R. § 2.204(d)(l)(i). The EPA must, and indeed did in the instant case, forward a specific request for comment to the proponent of the confidentiality claim. The notice solicits comment on a number of issues designed to determine the propriety of the request. 40 C.F.R. § 2.2024(e)(4). After receiving the affected business’ comments, the EPA determines the validity of the claim. The information is determined confidential if, after assertion of such a claim, the affected business satisfies the EPA that reasonable measures have been taken and will continue to be taken to protect the confidentiality of the information; and the information is not and has not been reasonably obtainable by other persons without the business’ consent or by use of legitimate means; and that no statute requires disclosure. Finally, the affected business must convince the EPA that disclosure is likely to cause harm to their competitive position, or if the disclosure was voluntary that public disclosure will impair the government’s ability to obtain such information in the future. A business claiming confidentiality must meet each of the above requirements to qualify the information for confidential treatment. See 40 C.F.R. § 2.208. Failure to make the required showing on any criteria results in denial of the confidentiality claim.

The EPA’s determination regarding the confidential treatment of the information herein is a final administrative determination, see 40 C.F.R. § 2.205, thus subject to review by this Court. See 5 U.S.C. § 702.

Facts

In returning their “Part B” application to the EPA, Alcolac claimed certain portions of the material to be “company confidential,” thus requesting that the EPA withhold the information from public disclosure. Correspondence was exchanged and the EPA solicited from Alcolac details of their confidentiality claim, specifically requesting Alcolac to reveal how long they desired confidential treatment for the material, measures they had taken to guard against undesired disclosure of the information, the extent to which disclosure had already occurred and precautions taken in this regard, whether any previous confidentiality determination had been made by any other federal agencies and, finally, if and how disclosure would have a substantial harmful effect on Alcolac’s competitive market position.

Alcolac’s attorney submitted their contentions by way of a letter, dated February 20, 1984. The fourteen-page response endeavored to provide the EPA with the “information on which Alcolac bottoms its confidentiality claim,” and to comprehensively “bring forward Alcolac’s position on confidentiality,” so that previous correspondence need not be reviewed.

After reviewing the administrative record, the EPA Regional Counsel, David Tripp, denied Alcolac’s claim of confidentiality. His findings and conclusions are before this Court and the focus of plaintiff’s complaint.

Standard of Review

Judicial review of final administrative action is available except where precluded by statute or where agency action is committed to agency discretion by law. 5 U.S.C. § 701(A)(1)(2). In this case, there is no indication that Congress sought to prohibit judicial review. Cf Abbott Laboratories v. Gardner, 387 U.S. 1507, 87 S.Ct. 1507, 1511, 18 L.Ed.2d 681 (1967). Likewise, the administrative decision does not fall within the narrow exception for action “committed to agency discretion by law.” This is most definitely not a case where the statutes and regulations are drawn in such broad terms that there is no law to apply. Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 91 S.Ct. 814, 820-21, 28 L.Ed.2d 136 (1971).

The standard by which this Court must review the EPA decision, as plaintiff acknowledges, is a narrow one. Section 706 of the Administrative Procedure Act, 5 U.S.C. § 551 et seq., provides that a reviewing court shall hold unlawful and set aside agency action, findings, and conclusions, found to be arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law. 5 U.S.C. § 706(2)(A).

The Court does not review the EPA denial of confidentiality de novo, nor does the agency action have ultimately to meet the substantial evidence test, however, the generally applicable standards of § 706 of the APA require this Court to engage in substantial inquiry. Citizens to Preserve Overton Park, Inc., supra, 91 S.Ct. at 823. The EPA decision is entitled to a presumption of regularity, however, that presumption does not sanction a “rubber-stamp” by this Court of the agency’s action. Id. In order to uphold the agency’s exercise of discretion, this Court must determine that the agency acted within the scope of their authority and the Court must ensure that the decision made was based on a consideration of relevant factors, and not a clear error of judgment. This review is limited however; this Court is not empowered to substitute its judgment for that of the agency’s. Citizens to Preserve Overton Park, Inc., supra, 91 S.Ct. at 824.

Opinion

Alcolac’s confidentiality claim basically centers around three types of information contained in the application submitted to the EPA. Alcolac claims confidentiality as to the disclosure of products produced on site, particularly disclosure of their specific product names. Second, Alcolac requests confidentiality for documents disclosing employee names, and organizational charts. Finally, Alcolac seeks confidentiality for a number of documents derived from an environmental design study done for Alcolac by Wapora, Inc.

That the EPA acted within their statutory authority is clear enough, and in fact plaintiff’s motion for summary judgment seems to indicate that they take no issue with the statutory ability of the EPA to determine the confidentiality of the documents. The Code of Federal Regulations allows a business to raise the confidentiality claim, and requires the EPA to make that determination. Procedure and substantive criteria provided by Federal Regulation were clearly used by the agency in this case.

Plaintiffs complaint necessarily maintains then that the EPA’s decision was not based on a consideration of relevant factors, or was the result of a clear error of judgment. The decision must be upheld, however, if this Court finds a rational connection between the facts found by the agency and the choices made. Erickson Transport Corp. v. ICC, 728 F.2d 1057 at 1062 (8th Cir.1984); Bowman Transportation, Inc. v. Arkansas Best Freight System, Inc., 419 U.S. 281, 285-86, 95 S.Ct. 438, 441-42, 42 L.Ed.2d 447 (1974).

As mentioned previously, the EPA makes the confidentiality determination in accordance with substantive criteria provided by 40 C.F.R. § 2.208. The decision is made after reviewing claimant’s response to a rather specific EPA notice and request for information highlighting the facts and contentions that the agency will base their decision on. EPA Regional Counsel, David R. Tripp, denied confidentiality after reviewing Alcolac’s letter of February 20, in light of the substantive criteria outlined in 40 C.F.R. § 2.208. For the following reasons, this Court finds the choices made to be rational given the facts found, and as no clear error of judgment was made, the agency’s determination will not be disturbed.

The majority of plaintiff’s claim concerns disclosure of information derived from the Wapora study. The plot-plan, effluent treatment system documents and environmental checklist are all derived from or contained in the “Environmental Control System Operating Manual — Alcolac, Inc.,” which Wapora prepared for Alcolac as part of a design study. The study was used in the construction of the plant and contains specifications and conceptual design information concerning the plant. A substantial amount of money was spent on the study as part of the design and construction of the plant.

The EPA concluded that the plot-plan submitted as part of the application was not entitled to confidentiality because Alcolac failed to make a satisfactory showing that it had taken reasonable measures to protect the confidentiality of the information and that the information was not obtainable by other legitimate means without Alcolac’s consent. These conclusions are rational in that the EPA found that a photograph in the Sunday, September 13, 1983, Kansas City Star depicted a substantial portion of the operating machinery and physical layout of the facility, revealing at least a portion of the same layout depicted by the plot-plan. Moreover, the EPA found that much of the information represented in the overhead plot-plan is based on commercially available information. Operating manuals for commercial components of the Alcolac facility are freely available to competitors. As a derivative of the design study, portions of which are commercially and publicly available, the plot-plan cannot be properly considered confidential. The EPA also based its conclusions on Alcolac’s failure to support their claim that the study was unique or proprietary beyond the fact that it was purchased and may involve state of the art concepts. Moreover, the Court notes that it is not the plan itself that is subject to disclosure, merely information contained therein or derived therefrom.

Another portion of the application described an “Effluent Treatment System” maintained and operated on the Alcolac facility. Again, this information is representative of portions of the design study. The EPA concluded that insofar as Alcolac had made no attempt to protect its confidentiality and as much of the information was reasonably and legitimately available elsewhere, it was not entitled to confidential treatment. That conclusion is reasonable in that the EPA determined information contained in the Wapora study consists in large part of the operating manuals of various commercial suppliers of pollution control equipment, information presumptively available to Alcolac’s competitors or the public. The EPA denied confidentiality to the effluent treatment system design information after finding Alcolac had submitted no additional information regarding the proprietary or unique characteristics of the design nor had they offered direct evidence of harm that would befall Alcolac by reason of the disclosure.

Finally, in regards to information derived from the Wapora study, the EPA denied confidentiality to an “environmental checklist” concluding for most of the same reasons described above. Alcolac had failed to show reasonable steps were taken to protect the confidentiality of the information, and concluding the information could be reasonably obtained elsewhere without the business’ consent, the EPA denied confidentiality. Again, these conclusions are rational given the facts found. The information in large part is commercially available, as many of the component operating manuals are available to the public. Moreover, Alcolac failed to show that Wapora had not used common features of the design study in other environmental pollution control applications.

Alcolac raised a claim of confidentiality for portions of the application containing employees’ names and corporate organizational charts. Alcolac maintained that the information was voluntarily submitted and disclosure would result in a reluctance to disclose such information in the future. The EPA denied confidentiality, noting that the information was not voluntarily submitted and could have otherwise been obtained from information previously submitted to the Missouri Department of Natural Resources. See 42 U.S.C. § 9601. Thus, given the basis of the confidentiality claim, the denial was proper.

Finally, the remaining portions of the confidentiality claim concern disclosure of certain product names contained in the RCRA application. Alcolac desired confidential treatment for documents disclosing or containing trade and/or generic names of products produced at the plant. The EPA conclusion that Alcolac had failed to establish disclosure would be harmful to its competitive position is rational in that the EPA found no support for Alcolac’s claim that any or all products manufactured or treated at the facility were done so secretly. Moreover, the EPA discounted Alcolac’s claim that disclosure of waste characteristics of the products would result in substantial harm to Alcolac’s competitive position. Alcolac’s claim that disclosure would give competition the ability to back calculate or ascertain from a waste stream the composition of manufactured end products was neither established nor supported by Alcolac’s response. Thus, the EPA conclusion that no competitive harm would result is rational given the basis of Alcolac’s claim of confidentiality.

Therefore, for the above reasons, it is hereby

ORDERED that the EPA’s confidentiality determination is neither arbitrary, capricious, nor an abuse of discretion, and as such defendants’ motion for summary judgment is sustained.

      . The withdrawal of the FOIA request has little, if any, effect on the justiciability of this dispute, or the propriety of the EPA’s confidentiality determination. It was the confidentiality claim asserted by Alcolac in their RCRA application that necessitated and initiated the EPA confidentiality determination, not the FOIA request. See 40 C.F.R. § 2.203(b). The filing, or withdrawal, of a FOIA request has no effect on the EPA’s authority to make this determination in the face of Alcolac’s initial claim of confidentiality.

      . The written notice invites the business's comments on the following points:
      (1) which portions of the information are alleged to be entitled to confidential treatment;
      (2) the period of time for which confidential treatment is desired;
      (3) the purpose for which the information was furnished to EPA;
      (4) whether the confidentiality claim was raised at the time the information was submitted to the EPA;
      (5) measures taken to guard against undesired disclosure;
      (6) the extent to which, and with what restrictions, the information has been disclosed to others;
      (7) previous confidentiality determinations made by other federal agencies;
      (8) whether disclosure would have substantial harmful effects on the claimant’s competitive position, and if so, what those harmful effects would be, why they are substantial and the causal relationship between disclosure and harmful effects.
      (9) If the information was voluntarily submitted, whether disclosure would lessen the availability to the EPA of similar information in the future.

        See 40 C.F.R. § 2.205(e)(4). Notice of this nature, and of likewise specificity was sent to Alcolac by the EPA on March 25, 1983, and February 2, 1984.


author: HAROLD A. ACKERMAN, District Judge.

text:
    AMERON, INC., Plaintiff, v. U.S. ARMY CORPS OF ENGINEERS, et al., Defendants.
    Civ. No. 85-1064.
    United States District Court, D. New Jersey.
    May 28, 1985.

      Theodore Botter, Meyer and Landis, Newark, N.J., for Ameron, Inc.
    Charles Tiefer, Deputy Gen. Counsel to the Clerk, Steven R. Ross, Gen. Counsel to the Clerk, Michael L. Murray, Asst. Counsel to the Clerk, Washington, D.C., for plaintiff-intervenors, Speaker and Bipartisan Leadership of the U.S. House of Representatives.

      Morgan Frankel, Asst. Senate Legal Counsel, Michael Davidson, Senate Legal Counsel, Washington, D.C., for plaintiff-intervenor, U.S. Senate.
    Edward G. Spell, Asst. U.S. Atty., Deputy Chief, Civ. Div., Newark, N.J., for the U.S. Army Corps of Engineers.
    Brian Mahoney, D’Alessandro, Sussman, Jacovino & Mahoney, Florham Park, N.J., for defendant Spiniello Const. Co.
   OPINION

HAROLD A. ACKERMAN, District Judge.

On March 27, 1985 I ruled on the plaintiff’s motion for a preliminary injunction in this matter holding that although the Army Corps’ decision to reject Ameron’s bid was unreviewable, the Army Corps must hold up all work on the contract until the Comptroller General had reviewed Ameron’s protest in accordance with the Competition and Contracting Act (CICA) Public Law No. 98-369, 98 Stat. 494 (1984), which I found to be constitutional, 607 F.Supp. 962.

Since my ruling the Comptroller General has reviewed plaintiff’s protest pursuant to CICA provision 31 U.S.C. §' 3553(d)(1) and has issued a decision denying plaintiff’s protest. As there seemed to be no disputes of fact in this case, but only strongly contested disputes of law, plaintiff-intervenors have now moved for summary judgment. In addition, the defendants have moved to dissolve the preliminary injunction in light of the GAO’s issuance of a decision on plaintiff’s protest.

Rule 56 of the Federal Rules of Civil Procedure provides that summary judgment is not to be granted unless, after all reasonable inferences are drawn in favor of the non-moving party, there is no genuine issue of material fact, and the moving party is entitled to judgment as a matter of law. See DeLong Corporation v. Raymond International, 622 F.2d 1135 (3d Cir.1980).

Thus I must give each party in turn the benefit of any reasonable inferences in their favor should there be any factual disputes.

The plaintiff-intervenors have also requested that the Secretary of Defense, the Honorable Casper W. Weinberger, and Office of Management and Budget Director, the Honorable David A. Stockman, be joined in order to effectuate complete relief in any order issued by this Court. I find it necessary and proper to join these two individuals as defendants and the relief sought in that respect will be granted.

I will first address plaintiff’s motion for summary judgment concerning the legality of the denial of its bid in the first place. Plaintiff contends that the Comptroller General’s decision is irrational and unreasonable and conflicts with established law concerning alteration of documents. Plaintiff’s counsel has enlarged on that theme very eloquently today and, of course, his brief speaks also to the points. I may say that I have already substantially addressed these arguments in my opinion on March 27, 1985. After careful consideration of Ameron’s brief and its oral argument today, I must say that the presentation of these arguments does not change my analysis of the law from what it was on the motion for preliminary injunction. I find, as a matter of law, that the Army Corps’ decision was not illegal or irrational, and I, therefore, cannot interfere with that decision. My reasoning relies principally on Princeton Combustion Laboratories v. McCarthy, 574 F.2d 1016 (3d Cir.1982) and is discussed in more detail on pages 8 to 11 of my previous opinion.

Plaintiff’s motion for summary judgment is accordingly denied in part. For the same reasons I grant defendants’ cross-motion for summary judgment as to the issue of the legality of the Army Corps’ denial of Ameron’s bid. The denial of Ameron’s bid had a legal and rational basis and will not be disturbed by this Court.

I turn then to the plaintiff-intervenor’s motion for summary judgment concerning the constitutionality of the stay provisions in CICA. Defendant’s have cross-moved for summary judgment on this same issue. All parties agree that there are no disputed issues of material fact, and each party maintains its original position that it is entitled to judgment as a matter of law.

Before I can consider any further motions in this matter, I must determine whether this Court still has jurisdiction over this matter following the Comptroller General's dismissal of Ameron’s bid protest. It is axiomatic that federal courts may constitutionally decide only actual controversies. See, e.g. Southern Pacific Terminal Co. v. Interstate Commerce Commission, 219 U.S. 498 at 514, 31 S.Ct. 279 at 283, 55 L.Ed. 310 (1911). This Court preliminarily enjoined defendant from proceeding any further with the contract award until the Comptroller General decided Ameron’s bid protest in compliance with the provisions of the Competition in Contracting Act. As I stated earlier, the Comptroller General has now decided the bid protest and issued a decision all in accordance with CICA.

While the legal merits of the Army Corps denial of Ameron’s bid did remain for final adjudication following the preliminary injunction, the question of the constitutionality of CICA may possibility be moot.

All parties urge that this issue is still justiciable under the “capable of repetition, yet evading review” doctrine. This doctrine was discussed at length in Southern Pacific Terminal cited supra, at page 515, 31 S.Ct. at page 283 where the plaintiff sought to have declared illegal an order of the Interstate Commerce Commission. There the Court quoted from the rule announced in United States v. Trans-Missouri Freight Association, 166 U.S. 290 at 308, 17 S.Ct. 540 at 546, 41 L.Ed. 1007. The Court said:

“Private parL'es may settle their controversies at any time, and rights which a plaintiff may have had at the time of the commencement of the action may terminate before judgment is obtained or while the case is on appeal, and in any such case the Court being informed of the facts would proceed no further in the action. Here, however, there’s been no extinguishment of the rights ... of the public, the enforcement of which the government has endeavored to procure by the judgment of a court under the provisions of the act of Congress ... The defendants cannot foreclose these rights nor prevent the assertion thereof by the government as a substantial trustee for the public under the act of Congress by any such action as has been taken in this case.”

The Court again discussed the “capable of repetition yet evading review” doctrine in Super Tire Engineering Co. v. McCorkle, 416 U.S. 115, 94 S.Ct. 1694, 40 L.Ed.2d 1 (1974) where the Court stated at pages 125 and 126, 94 S.Ct. at pages 1699 and 1700:

“It is sufficient, therefore, that the litigants show the existence of an immediate and definite governmental action or policy that was adversely affected and continues to affect a present interest. Otherwise (the policy at issue) could be adjudicated only rarely and the purposes of the ... Act, would be frustrated.”

After citing numerous cases where the Court rejected claims of mootness, the Court emphasized:

“The important ingredient in this cases was governmental action directly affecting, and continuing to affect the behavior of citizens in our society.” See Super Tire at page 126, 94 S.Ct. at page 1700.

This case I find falls squarely within the “capable of repetition yet evading review” doctrine as explained in these cases. Were a final judgment on the constitutionality of CICA to be evaded by the Comptroller General’s dismissal of the protest, the constitutionality of CICA would most likely never be finally adjudicated. Under the provisions of CICA the Comptroller General must render a decision on the protest in 90 days. This makes it nearly impossible for a Court to render a final decision on the constitutionality of the stay provision before the protest is dismissed.

While the nature of the CICA procedures make it difficult, if not impossible, to finally adjudicate their constitutionality before the review provision is completed, the policy of the Executive Branch not to follow some of the CICA provisions is clearly capable of repetition. As I discussed in my earlier opinion and I will discuss, supra, it is the policy of the Executive Branch to instruct all administrative agencies not to comply with the CICA provisions that I explicitly held to be constitutional. As I noted in my prior opinion, the procedures mandated under CICA could potentially effect the process of bid protest for something in the range of $168 billion, the amount of government contracts awarded in 1983 which Congress attempted to bring under a more competitive bidding structure. The Executive Branch’s action in directing noncompliance with CICA is “governmental action directly affecting and continuing to affect the behavior of citizens in out society” and if the issue is not adjudicated, the purposes of the Act are frustrated. See Super Tire Engineering, supra.

Before turning to the parties’ cross-motions for summary judgment as to the constitutionality of the Act, I would like to address a few preliminary matters.

The House intervenors have asked that this Court affirm its jurisdiction in this case to decide the legal issue before it. While this Court always notes whether or not it has jurisdiction before proceeding further on any issue, this is an unusual request in a case such as this where the basis for this Court’s jurisdiction is clear and straightforward.

I find the House’s request to be warranted, however, in light of the novel approach that the Executive Branch has taken in this case to deliberately determine to disobey portions of the law passed by Congress and signed by the President of the United States.

In reviewing the position of the Executive Branch in events both before and after my March 27th decision, I am forced to conclude that the fundamental role of this Court in stating what the law is has now been challenged by the Executive Branch. Almost as disconcerting as the facts of such a confrontation, which I find to be grievous, is the fact that the Executive Branch has mounted this assault elsewhere rather than in filings submitted to this Court.

In order to fully relate the extent of this attack, I repeat some of the background contained in my earlier opinion. When President Reagan signed CICA into law he “objected to certain provisions that would unconstitutionally attempt to delegate to the Comptroller General ... duties and responsibilities ... which may be performed only by officials of the Executive Branch.” 20 Weekly Compilations Presidential Documents, Page 1027, July 18, 1984. The President “instructed the Attorney General to inform all Executive Branch agencies as soon as possible with respect to how they may comply with the provisions of this bill in a matter consistent with the Constitution.”

On December 17, 1984, the Honorable David Stockman, Director of the Office of Management & Budget (OMB) issued Bulletin No. 85-8 entitled Procedures Governing Implementation of Certain Unconstitutional Provisions of the Competition in Contracting Act of 1984, hereinafter designated as “The Unconstitutionality Bulletin,” which explained that the Executive Branch had decided that CICA was unconstitutional. Although both houses of Congress had duly passed the law and CICA had become law upon the signature of the President, the Unconstitutionality Bulletin commanded not merely that the Executive Branch present views opposing the statute, but that all agencies carry out the Executive Branch’s decision that the Act was unconstitutional. Over strenuous congressional protest, the Executive Branch continually reaffirmed its view that the Executive possessed the power to decide statutes unconstitutional.

The Executive’s position is that there is no difference between merely offering a view that a statute is unconstitutional (such as by declining to defend the statute in a court challenge) and deciding that a law is unconstitutional. See, for example, the letter of February 22, 1985 from Attorney General William French Smith to the Honorable Peter Rodino, Jr. when the then Attorney General stated that “the Executive Branch’s decisions not to execute or not to defend a statute are inextricably intertwined.”

The Acting Deputy Attorney General then testified before the House Committee on Governmental Operations on March 7, 1985, that “the President’s duty faithfully to execute the laws requires him not to observe a statute that is in conflict with the Constitution, the fundamental law of the land.”

See “Testimony of D. Lowel Jensen, reprinted in a volume entitled Constitutionality of GAO’s Bid Protest Function, Hearings Before a Subcommittee of the House Commission on Government Operations, 99th Congress, 1st Session (1985) at pages 302 and 318.

In April of this year, the Attorney General of the United States, the Honorable Edwin Meese, III, again so testified before the House Committee on the Judiciary, and again in April, again so stated in a public letter to the New York Times, (see the letter of May 21st, 1985, entitled “President’s Right to Challenge a Law”), which the House intervenors have attached to their brief.

The present Attorney General has specifically assailed the jurisdiction of this Court in this case. In testimony on April 18, 1985, before the House Committee on the Judiciary, Attorney General Meese stated that this Court’s decision of March 27 was not being followed because the Executive Branch was waiting until a court competent to decide the constitutionality of the law had decided the issue.

Such a position by the Executive Branch, I find, flatly violates the express instruction of the Constitution that the President shall “take care that the Laws be faithfully executed.” United States Constitution Article II, Section 3. It has been one of the bedrocks of our system of government that only the Judiciary has the power to say what the law is. See Mar-bury v. Madison, 5 U.S. (1 Cranch) 137, 177, 2 L.Ed. 60 (1803).

The Executive Branch’s position that they can say when a law is unconstitutional equates the powers of mere executive officials with those of the Judiciary. It flies in the face of the basic tenet laid out so long ago by the United States Supreme Court in United States v. Lee, 106 U.S. (16 Otto) 196 at Page 220, 1 S.Ct. 240 at 260, 27 L.Ed. 171 (1882). The Court said, “No man in this country is so high that he is above the law. No officer of the law may set that law at defiance, with impunity. All the officers of the Government, from the highest to the lowest, are creatures of the law and are bound to obey it.”

The rule that no executive official can decide for himself what laws he is bound to obey, but must await decisions of the Judiciary and until then must obey the laws, has deep roots in our constitutional history. As explained in Mr. Tiefer’s presentation to the House, which is in the House Hearings Bulletin previously cited at page 257. During the reign of absolute British monarchs, the notion that the Executive, at the time the King, could decide for himself, without a decision of the courts, which laws should be obeyed was put to the test.

As Mr. Tiefer correctly noted, “After the Restoration, King James II attempted to claim such authority, but the English people would no longer tolerate such a claim, and their judicial system rejected it in the historic Seven Bishops Case of 1688.

“Shortly thereafter, James II was forced into exile in the Glorious Revolution of 1689, and the English Bill of Rights was enacted. The first article of that historic charter of freedom declared ‘That the pretended power of Suspending of Laws, or the Execution of Laws by Regal Authority, without Consent of Parliament is Illegal.’ Scholars have concluded that the ‘faithful execution’ clause of our Constitution is a mirror of the English Bill of Rights’ abolition of the suspending power,’ that is, the abolition of what the English Bill of Rights had called ‘the pretended (Royal) power of Suspending’ ...

“In fact, the Constitutional Convention in 1787 expressly rejected the attempt to reintroduce some power for the President to decide to suspend the execution of laws. In that summer of 1787 Mr. Elbridge Gerry, a Delegate, observed, after a proposal was made at the Philadelphia Convention, “that the national executive have a power to suspend any legislative act ... ” He noted, “that the power of suspending might do all the mischief dreaded from the novative of useful laws (i.e., the President’s veto), without answering the salutary purpose of checking unjust or unwise ones.”

The Constitutional Convention, I note, rejected the proposal. “Mr. Tiefer noted, “If the Framers had intended to give the President any such awesome power of deciding the constitutionality of laws as they gave to the Judiciary, there clearly would have been a clear record of it. Yet Alexander Hamilton, who discussed in detail the authority of the Judiciary to decide the constitutionality of laws, provided no such discussion of the supposedly equivalent Presidential power.

“Any possible doubt about the matter was resolved in the historic case of Kendall v. United States, 37 U.S. (12 Pet) 524, 9 L.Ed. 1181 (1838). There, a Cabinet Member claimed that because he was subject to the President, who, in turn, supposedly derived a vast power from the ‘faithful execution’ clause, he was not bound by the laws.

“The Supreme Court utterly rejected any such argument of Executive supremacy. The Supreme Court said that ‘to contend, that the obligation imposed on the President to see the laws faithfully executed, implies a power to forbid their execution, is a novel construction of the constitution, and entirely inadmissible.’

“That Court,” Mr. Tiefer noted, “harkened directly back to the classic language of the English Bill of Rights, and the Framers in a Constitutional Convention, in rejecting Executive power to ‘forbid [the] execution’ of the laws.

“In rejecting the Executive’s argument, the Court explained that the effect of such power would be the ‘vesting in the President [of] a dispensing power, which has no countenance for its support, in any part of the constitution; [such an argument is] asserting a principle, which, if carried out in its results, to all cases falling within it, would be clothing the President with a power entirely to control the legislation of Congress, and paralyze the administration of justice.”

More recently the Supreme Court reaffirmed the distinction between the Executive Branch’s right to express views on the constitutionality of a law and the Judiciary’s right to decide the constitutionality in Immigration & Naturalization Service v. Chadha, 462 U.S. 919, 103 S.Ct. 2764, 77 L.Ed.2d 317 (1983).

I thus reject any attempt to characterize this Court as incompetent to make binding decisions of constitutional law and I order all parties, specifically the Executive Branch, to follow any ruling I make in this case in this district in which I am sitting. And that refers also to the Honorable Casper A. Weinberger and the Honorable David Stockman.

I, and the members of the Executive Branch of the Government, have taken an oath to execute and fulfill the duties of our offices according to the Constitution and laws of the United States. I believe I adhered to that oath and I would expect no less from members of the Executive Branch of the Government, regardless of what their station is within that Branch.

I order them to uphold that oath with respect to following this Court’s order, which remains legally viable in this district until overruled by an appellate court.

I now turn to the parties’ cross-motions for summary judgment as to the constitutionality of the act.

Defendants rely on the arguments submitted in opposition to the motion for preliminary injunction and supplement those arguments with additional case law discussing the position of the Comptroller General. Defendants continue to assert that the Comptroller General is part of the Legislative Branch.

I have carefully reviewed defendants’ additional theories as to why the Comptroller General cannot constitutionally carry out the duties assigned to that office under the Competition in Contracting Act and find them to be as unpersuasive now as I found them on the motion for preliminary injunction. United States Supreme Court case law clearly distinguishes the unconstitutionality of giving legislative officers executive duties from the constitutionality of giving executive officers legislative powers. See, for example, Springer v. Philippine Islands, 277 U.S. 189 at 202, 48 S.Ct. 480 at 482, 72 L.Ed. 845 (1928); Buckley v. Valeo, 424 U.S. 1, 96 S.Ct. 612, 46 L.Ed.2d 659.

I found that the appointment of the Comptroller General by the Executive allows the Comptroller General to exercise these duties which are statutorily assigned to him, whether they be executive and/or legislative in nature.

I do not find it necessary to repeat my entire analysis of the law for purposes of this motion. For the reasons I stated in my opinion of March 27, 1985, I find Title 31, U.S.C. Section 3553(d)(1) to be constitutional. The plaintiff intervenor’s motion for summary judgment on this issue is accordingly granted, and that of the defendants is denied.

Lastly, I turn to the defendants’ motion to dissolve the preliminary injunction. Motions to dissolve an injunction are addressed to the sound discretion of the district court. See Securities and Exchange Commission v. Warren, 583 F.2d 115 (3d Cir.1978). Where, however, a final judgment has been entered on the merits, the preliminary injunction comes to an end and is superseded by the final order.

A preliminary injunction is by its very nature interlocutory, tentative and impermanent. See, Hamilton Watch Co. v. Benrus Watch Co., 206 F.2d 738 at 742 (2d Circuit 1953). The preliminary injunction is, therefore, superseded by my final judgment on the merits that the stay provisions in CICA are constitutional.

Thus, my interlocutory order that the CICA stay provisions are constitutional and that they must be followed is now a final order that they are constitutional and must be followed.

I specifically note that the preliminary injunction has only been dissolved because it has been superseded by a final order.

As there are two separate issues for appeal here, my ruling on the constitutionality of the CICA provisions and my ruling of the denial of Ameron’s bid, I am entering two separate orders here today with respect to this matter.


author: HUNGATE, District Judge.

text:
    Edward JOHNSON, Plaintiff, v. HUSSMANN CORPORATION, Defendant.
    No. 85-0472C(3).
    United States District Court, E.D. Missouri, E.D.
    May 28, 1985.

      Charles Schroeder, Beck, Tiemeyer & Zerr, St. Charles, Mo., for plaintiff.
    Kohn, Shands, Elbert, Gianoulakis & Giljum, Mark J. Bremer and Robert A. Useted, St. Louis, Mo., for defendant.
   MEMORANDUM

HUNGATE, District Judge.

This matter is before the Court on plaintiff’s motion to remand to state court and defendant’s motion for summary judgment and to dismiss.

Plaintiff brings this action alleging that he was discharged from his employment by defendant in retaliation for plaintiff’s exercise of a right conferred upon him by Missouri’s workers’ compensation law. Plaintiff seeks to have this case remanded to state court because his action arises under state law. Defendant contends that plaintiff’s claim arises under § 301 of the Labor Management Relations Act, 29 U.S.C. § 185, which preempts state law invoked to regulate activity that is the subject of a collective bargaining agreement and, as a result, this action is properly removed to federal court.

Until recently, the weight of authority may have appeared to support plaintiff’s position that his action for retaliatory discharge under state workers’ compensation statutes was not preempted by the federal labor law. Both the Ninth and the Tenth Circuit Courts of Appeals had held that suits alleging wrongful termination in violation of state public policy are not preempted or precluded by the grievance and arbitration clauses of collective bargaining agreements. See, e.g., Peabody Galion v. Dollar, 666 F.2d 1309 (10th Cir. 1981) (action for retaliatory discharge for pursuing workers’ compensation not preempted); Garibaldi v. Lucky Food Stores, Inc., 726 F.2d 1367 (9th Cir.1984), cert. denied, — U.S.-, 105 S.Ct. 2319, 85 L.Ed.2d 839 (1985) (claim of retaliatory discharge for reporting state health law violations not preempted); compare Lamb v. Briggs Mfg., a Div. of Celotex Corp., 700 F.2d 1092 (7th Cir.1983) (under Illinois law, a state claim for retaliatory discharge for pursuing workers' compensation not available to employees covered by collective bargaining agreements). However, last month in Allis-Chalmers Corp. v. Lueck, — U.S. -, 105 S.Ct. 1904, 85 L.Ed.2d 206 (1985), the Supreme Court found a Wisconsin tort law action for bad faith handling of an insurance claim was preempted by the federal labor law. The Court concluded that state law rights and obligations that do not exist independently of collective bargaining agreements are preempted by those agreements. The Court further reasoned that an action that permits an individual to sidestep the available grievance and arbitration procedure eviscerates a central tenet of federal law. Id. 105 S.Ct. at 1916.

The issue raised by plaintiff in this case is whether or not he was properly discharged. The parties’ collective bargaining agreement contains a grievance and arbitration procedure by which plaintiff and other of defendant’s employees may challenge the propriety of a decision by defendant to terminate their employment. It can be fairly said that the relationship between employer and employee that is the subject of the collective bargaining agreement is also the basis for the tort of retaliatory discharge under Missouri law. “If the state tort law purports to define the meaning of the contract relationship, that law is pre-empted.” Id. at 1912. See also Moore v. General Motors Corp., 739 F.2d 311, 315 (8th Cir.1984), cert. denied, — U.S. -, 105 S.Ct. 2320, 85 L.Ed.2d 839 (1985). Therefore, because the Missouri law in this case is related directly to and affects the contractual relationship between the parties, it is preempted by the federal law. Accordingly, plaintiff’s motion to remand will be denied.

Plaintiff was discharged from his employment on February 7, 1984. This action was commenced in the Circuit Court of St. Louis County on January 25, 1985. In § 301 cases such as this, the applicable statute of limitations is six months. 29 U.S.C. § 160(b). More than six months have elapsed since the alleged violation. Therefore, plaintiff’s claim is time-barred. Accordingly, defendant’s motion to dismiss will be granted.