Taylor v. Federal Aviation Administration ( 2018 )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
_________________________________________
)
ROBERT C. TAYLOR, )
)
Plaintiff, )
)
v. ) Case No. 18-cv-00035 (APM)
)
FEDERAL AVIATION )
ADMINISTRATION, et al., )
)
Defendants. )
_________________________________________ )
MEMORANDUM OPINION AND ORDER
I. INTRODUCTION
Plaintiff Robert Taylor is a model aircraft enthusiast who owns multiple model planes and
flies them as a hobby and for recreational purposes. He brings this action on behalf of himself and
a putative class of all model aircraft owners who paid $5 to register their aircraft with the Federal
Aviation Administration (FAA) under a rule later struck down by the D.C. Circuit. Plaintiff claims
that the registration requirement violated the Privacy Act and the Little Tucker Act. He also
advances against the FAA a violation of his constitutional right of privacy, as well as the common
law tort of unjust enrichment. Plaintiff demands that the agency return the more than $4 million
it collected in registration fees and pay over $836 million in statutory penalties.
Defendant FAA now moves to dismiss, arguing that (1) Plaintiff lacks standing to sue,
(2) the D.C. Circuit has exclusive jurisdiction over this matter, and (3) the Complaint fails to state
a claim upon which relief can be granted. For the reasons stated herein, the court holds that, as
presently pleaded, Plaintiff lacks standing to bring this action. Defendant’s Motion to Dismiss is
therefore granted.
II. BACKGROUND
A. Factual Background
The Federal Aviation Administration (FAA) is tasked with “promot[ing] safe flight of civil
aircraft in air commerce[.]” 49 U.S.C. § 44701. Invoking this authority, on December 16, 2015,
the FAA issued an interim final rule (the “Registration Rule”), requiring owners of small
unmanned aircraft, including model aircraft, to register their aircraft with the FAA “to facilitate
compliance with the statutory requirement that all aircraft register prior to operation.” 80 Fed.
Reg. at 78,594 (Registration Rule); see also Pl.’s Compl. and Demand for Jury Trial, ECF No. 1
[hereinafter Compl.], ¶ 7; Def.’s Mot. to Dismiss, ECF No. 23 [hereinafter Def.’s Mot.], at 4. The
Registration Rule required a registrant to supply her name, address, and email address.
See 14 C.F.R. § 48.100(b). The registration was good for three years, id. §48.11(c), and the fee to
register was $5, id. § 48.30(b).
On May 19, 2017, the D.C. Circuit struck down the Registration Rule insofar as it mandated
registration of model aircraft. Taylor v. Huerta, 856 F.3d 1089 (D.C. Cir. 2017). The Circuit’s
decision rested on Section 336(c) of the FAA Modernization and Reform Act, Pub. L. No. 112-
95, 126 Stat. 11 (2012), which provides that the FAA “may not promulgate any rule or regulation
regarding a model aircraft” flown for recreational use and meeting certain additional criteria, see
Taylor, 856 F.3d at 1092–93. The Circuit succinctly explained why the Registration Rule as
applied to model aircraft could not stand:
In short, the 2012 FAA Modernization and Reform Act provides that
the FAA “may not promulgate any rule or regulation regarding a
model aircraft,” yet the FAA’s 2015 Registration Rule is a “rule or
regulation regarding a model aircraft.” Statutory interpretation does
not get much simpler. The Registration Rule is unlawful as applied
to model aircraft.
2
Id. at 1092. The Circuit rejected the FAA’s various arguments attempting to justify its exercise of
regulatory authority over model aircraft. See id. at 1092–93.
Following the D.C. Circuit’s decision, the FAA ceased enforcing the Registration Rule and
took steps to enable model aircraft owners to undo their registrations. Compl. ¶ 16; Def.’s Mot. at
5–6. The FAA made available on its website a form, titled “Section 336 Aircraft Owner Request
to Delete Registration/Receive Refund,” which allowed registrants to seek a refund and ask that
their personal information be deleted. Compl. ¶ 16; Def.’s Mot. at 5–6; Def.’s Mot., Ex. 1, ECF
No. 23-2, Section 336 Aircraft Owner Request to Delete Registration/Receive Refund [hereinafter
“Refund Form”]. The Refund Form required owners to certify that they operated their model
aircraft in compliance with various statutory requirements and, if they sought a refund, to supply
bank account information. Compl. ¶ 16. Plaintiff did not submit a Refund Form.
The relief afforded model aircraft owners under Taylor was short lived. On December 12,
2017, the President signed into law the National Defense Authorization Act for Fiscal Year 2018,
(“NDAA”), which revived the Registration Rule. Section 1092(d) of the NDAA provides:
The rules adopted by the Administrator of the Federal Aviation
Administration in the matter of registration and marking
requirements for small unmanned aircraft (FAA-2015-7396;
published on December 16, 2015) that were vacated by the United
States Court of Appeals for the District of Columbia Circuit in
Taylor v. Huerta (No. 15-1495; decided on May 19, 2017) shall be
restored to effect on the date of enactment of this Act.
Pub. L. No. 115-91, 131 Stat. 1283 (2017). Thus, the NDAA granted the FAA the statutory
authority to require registration of model aircraft that the D.C. Circuit in Taylor held the FAA did
not possess.
With the Registration Rule reinstated, the FAA provided guidance to model aircraft
owners. As to owners who had registered their aircraft prior to Taylor, the FAA did not require
3
them to re-register, unless the owner had completed the refund/deletion process offered by the
agency. Def.’s Mot. at 6–7. 1 Additionally, the FAA made all pre-Taylor registrations effective
until December 12, 2020, thus treating those registrations as if having occurred on the date of the
NDAA’s enactment. Id. at 7.
B. Procedural Background
Plaintiff brought the instant suit as a class action on January 5, 2018. See generally
Compl. 2 The crux of his Complaint is that the FAA lacked the statutory power to demand and
retain his personal information and the $5 registration fee until Congress passed the NDAA on
December 12, 2017. Compl. ¶¶ 15,18,19. This unlawful exercise of authority, Plaintiff maintains,
violated the Privacy Act (Count I), the Little Tucker Act (Count II), and his “Constitutional and
privacy rights” (Count III). He also alleges that the agency was unjustly enriched by the
unauthorized fees collection (Count IV). Plaintiff seeks declaratory relief, a refund of the
registration fees collected before December 12, 2017 (totaling $4,183,980), and over $836,796,000
in statutory penalties for each violation of the Privacy Act (the equivalent to $1,000 for every
putative class member). Compl. at 15–16 ¶¶ C – L.
Defendant then moved to dismiss, arguing (1) Plaintiff does not have standing to assert his
claims, (2) the D.C. Circuit has exclusive jurisdiction over this action, and (3) the Complaint fails
to state a legally cognizable cause of action. See generally Def.’s Mot. 3 Because the court finds
that Plaintiff lacks standing, it does not reach the second and third arguments.
1
Citing FAA, Unmanned Aircraft Systems Frequently Asked Questions, https://www faa.gov/uas/faqs/.
2
Plaintiff first brought the claims raised here on August 3, 2017, in a separate action commenced in the District of
Maryland. Def.’s Mot. at 7–8. However, Plaintiff voluntarily dismissed that action after passage of the NDAA. Id.
3
Plaintiff moved to certify the class, see ECF No. 6, but the court stayed the question of class certification until it
resolved Defendant’s Motion to Dismiss, see Minute Order granting Motion to Hold in Abeyance, ECF No. 12.
4
III. LEGAL STANDARD
A motion to dismiss for lack of standing arises under Federal Rule of Civil Procedure
12(b)(1). See Food & Water Watch, Inc. v. Vilsack, 808 F.3d 905, 913 (D.C. Cir. 2015).
Every plaintiff in federal court bears the burden of showing that she meets the “irreducible
constitutional minimum” of Article III standing: (1) injury in fact, (2) causation, and
(3) redressability. See Lujan v. Defenders of Wildlife, 504 U.S. 555, 560–61 (1992). At the motion
to dismiss stage, a plaintiff “must state a plausible claim that [she has] suffered an injury in fact
fairly traceable to the actions of the defendant that is likely to be redressed by a favorable decision
on the merits.” Food & Water Watch, 808 F.3d at 913 (quoting Humane Soc’y of the U.S. v.
Vilsack, 797 F.3d 4, 8 (D.C. Cir. 2015)). The court must accept as true all well-pleaded factual
contentions and draw all reasonable inferences therefrom, but it need not accept thread-bare
recitals of the elements of standing or legal conclusions couched as factual averments. See Arpaio
v. Obama, 797 F.3d 11, 19 (D.C. Cir. 2015). In deciding a Rule 12(b)(1) motion, the court “may
consider materials outside the pleadings[.]” Jerome Stevens Pharm., Inc. v. Food & Drug Admin.,
402 F.3d 1249, 1253 (D.C. Cir. 2005) (citation and alteration omitted).
IV. DISCUSSION
With these standards in mind, the court proceeds to consider whether Plaintiff has carried
his burden of establishing standing. He has not. Plaintiff satisfies neither the injury-in-fact nor
redressability elements of standing.
A. Injury in Fact
To satisfy the injury-in-fact requirement, plaintiff must show that his alleged injury was
both concrete and particularized. Friends of the Earth, Inc. v. Laidlaw Envtl. Servs. (TOC), Inc.,
528 U.S. 167, 180 (2000). Further, an injury in fact must be “actual or imminent, not conjectural
5
or hypothetical.” Lujan, 504 U.S. at 560. And, as here, in the class-action context, named plaintiffs
“must allege and show that they personally have been injured, not that injury has been suffered by
other, unidentified members of the class to which they belong and which they purport to represent.”
Warth v. Seldin, 422 U.S. 490, 502 (1975) (emphasis added).
Plaintiff is quite clear as to what he believes constitutes a cognizable injury in fact in this
case. He asserts two forms of injury. First, “he lost the use of funds during the period in which
the FAA lacked statutory authority to collect such registration fees” and “had not been
compensated for the lost use of funds at the time he filed suit.” Pl.’s Opp’n to Def.’s Mot., ECF
No. 24 [hereinafter Pl.’s Opp’n], at 8; see also Compl. ¶ 37 (alleging that he was “deprived . . . of
the use of those funds”). Second, he suffered the “intangible harm of Defendants’ unlawful
maintenance of his personal information.” Pl.’s Opp’n at 9. The court considers each of these
claimed injuries in turn.
1. Interest and the Time Value of Money
The “time value of money” is the notion that money available today is worth more than the
same amount of money in the future. See, e.g., Stephens v. U.S. Airways Grp., Inc., 644 F.3d 437,
442 (D.C. Cir. 2011) (Kavanaugh, J., concurring). That principle is premised on the idea that
money can earn interest over time or be put to some other income-generating use, if invested.
See id.
Neither the Supreme Court nor the D.C. Circuit has determined whether the lost time value
of money is a harm concrete enough to satisfy the injury-in-fact requirement. Indeed, only one
circuit court appears to have even come close to embracing such a theory, and there the alleged
lost use was for a sum of money ($10,000) far greater than at issue here. See Habitat Educ. Ctr.
v. U.S. Forest Serv., 607 F.3d 453, 457 (7th Cir. 2010) (stating that “[e]very day that a sum of
6
money is wrongfully withheld, its rightful owner loses the time value of the money,” creating a
harm sufficient for standing). The only other circuit to have faced the question declined to reach
it. See Kawa Orthodontics, LLP v. Sec., U.S. Dep’t. of Treasury, 773 F.3d 243, 246 (11th Cir.
2014). And some district courts have rejected the notion that lost time value of money is
constitutionally sufficient to satisfy standing when the amount wrongfully taken or withheld was
discharged before filing suit—a circumstance comparable to this case, as Plaintiff now must pay
the $5 fee to register his model aircraft. E.g., Amirhamzeh v. Chase Bank USA, N.A., No. CV 13-
00527 BRO FFMX, 2013 WL 7219270, at *4 (C.D. Cal. Oct. 7, 2013); Holaway v. Protective Life
Ins. Co., No. 4:07-CV-109 (CDL), 2007 WL 2904162, at *2 (M.D. Ga. Oct. 3, 2007). Thus,
accepting the lost time value of money as a cognizable constitutional injury is far from well
established.
The court need not, however, venture down this rabbit hole. For even if the lost time value
of money could suffice to make out an Article III injury, the “bare allegation that [a plaintiff] has
lost the value of the time and resources . . . sets out an injury that is too abstract and indefinite to
confer Article III standing.” Kawa Orthodontics, 773 F.3d at 246 (cleaned up). Here, Plaintiff
does not allege any facts to suggest that if he had not paid the $5 registration fee he would have
invested the $5 in some way to increase its value. See generally Compl. At most, he offers only
generalizations that he was “deprived . . . of [the] use of those funds” and is entitled “to be
compensated for his lost use of funds.” Compl. ¶ 37; Pl.’s Opp’n. at 9. Such conclusory
proclamations are not the kind of clear allegations of fact necessary to establish an injury in fact,
even at the motion to dismiss stage. See Spokeo, Inc. v. Robins, 578 U.S. __, __, 136 S. Ct. 1540,
1547 (2016). Other courts have reached the same conclusion. See Kawa Orthodontics, 773 F.3d
at 246 (finding that where plaintiff did not mention interest or suggest “specific plans to invest its
7
money into an interest-bearing asset,” the court could not “hypothesize or speculate about the
existence of an injury [plaintiff] did not assert”); Barber v. Lincoln Nat’l Life Ins. Co., 260 F. Supp.
3d 855, 862 (W.D. Ky. 2017) (“The complaint makes no particularized allegation that [plaintiff]
lost the time value of money . . . It may be implied by the nature of [plaintiff’s] allegations
that . . . he lost the opportunity to grow that money through investment. But the Court cannot find
injury via implication[.]”).
Therefore, as pleaded, Plaintiff does not allege a sufficient injury in fact to support standing
based on the lost time value of money. 4
2. Unlawful Maintenance of Personal Information
Plaintiff’s contention that the FAA’s unlawful acquisition and maintenance of his personal
information constitutes a cognizable injury suffers from similar problems. Presumably, this
asserted injury arises from the FAA’s alleged violation of the Privacy Act. See Compl. ¶¶ 33–34,
37. In Doe v. Chao, the Supreme Court explained that the Privacy Act’s reference to “adverse
effect” in 5 U.S.C. § 552a(g)(1)(D)—the statutory section under which Plaintiff asserts his Privacy
Act claim, see Compl. ¶ 36—“acts as a term of art identifying a potential plaintiff who satisfies
the injury-in-fact and causation requirements of Article III standing, and who may consequently
bring a civil action without suffering dismissal for want of standing to sue.” Doe v. Chao, 540
U.S. 614, 624 (2004). The Court in Doe did not supply a definition of “adverse effect,” and this
court has not found a decision from the D.C. Circuit, or any other circuit, that does so. Whatever
4
The court recognizes that the D.C. Circuit has said that a “dollar of economic harm is still an injury-in-fact for
standing purposes.” Carpenters Indus. Council v. Zinke, 854 F.3d 1, 5 (D.C. Cir. 2017). But how about less than a
dollar? The court need not resolve that question. Nevertheless, by the court’s rough calculations, using the current
approximate benchmark interest rate of 2.25%, an investment of $5 over two years’ time (assuming Plaintiff paid his
registration fee on the very day the FAA adopted the Registration Rule) would yield 23 cents in lost interest. Is that
enough harm to establish Article III standing? Some courts have said unpaid interest in similar circumstances is not
enough to confer standing. See Friedman v. Dollar Thrifty Auto. Grp., Inc., 227 F. Supp. 3d 1192, 1203 (D. Colo.
2017) (holding that a person made whole as to the amount allegedly wrongfully withheld and whose only claimed
injury is “he was not paid interest on the amount” lacks sufficient injury to establish standing) (citing cases).
8
the term may include, it cannot sweep so broadly as to encompass Plaintiff’s claimed injury—the
mere improper maintenance of Plaintiff’s name, address, and email address by the FAA. Indeed,
one circuit court has rejected more meaningful claimed injuries as failing to satisfy the “adverse
effect” standard. See, e.g., Beck v. McDonald, 848 F.3d 262, 272 (4th Cir. 2017) (rejecting
“emotional upset” and “fear [of] identity theft and financial fraud” resulting from a data breach as
sufficient to confer Article III standing for a Privacy Act violation). Cf. In re Sci. Applications
Int’l Corp. (SAIC) Backup Tape Data Theft Litig., 45 F. Supp. 3d 14, 28–29 (D.D.C. 2014) (finding
no injury, awarding no statutory damages, and dismissing under Rule 12(b)(1) a Privacy Act
violation claim for a data breach resulting from the theft of tapes containing the data of 4.7 million
members of the U.S. military and their families where plaintiffs alleged no harm other than the
theft of their data); Speaker v. U.S. Dep’t of Health & Human Servs. Centers for Disease Control
& Prevention, 623 F.3d 1371, 1382 (11th Cir. 2010) (finding standing where the plaintiff alleged
such harms as strain on his marital relationship, public criticism, death threats, and damage to
reputation because of unauthorized disclosure of medical information). Thus, the wrongful
possession of Plaintiff’s personal information, without more, does not establish an injury in fact.
Plaintiff’s claimed injury arising from the FAA’s keeping of his personal information also
runs aground on Circuit precedent. Recently, the D.C. Circuit held in Owner-Operator
Independent Drivers Ass’n, Inc. v. U.S. Department of Transportation, that the mere existence of
inaccurate information about truckers’ driving records in an agency database does not amount to
a sufficiently concrete injury to confer standing, even where the agency had a statutory obligation
to keep accurate records. See 879 F.3d 339, 341, 344–45 (D.C. Cir. 2018); cf. id. (holding that the
disclosure of inaccurate information to a potential employer was a sufficient injury). If the mere
maintenance of inaccurate information is not sufficient to confer standing, surely an agency’s
9
retention of prosaic personal information is not either. Plaintiff therefore lacks standing to assert
his claim under the Privacy Act.
B. Redressability
“The redressability inquiry,” to which the court now turns, “poses a simple question:
‘If plaintiffs secured the relief they sought, . . . would [it] redress their injury’?” The Wilderness
Soc'y v. Norton, 434 F.3d 584, 590 (D.C. Cir. 2006) (quoting Mountain States Legal Found. v.
Glickman, 92 F.3d 1228, 1233 (D.C. Cir. 1996)). To demonstrate that a claimed injury is
redressable requires a plaintiff to show that the court possesses the authority to grant the remedy
requested. See Swan v. Clinton, 100 F.3d 973, 976 (D.C. Cir. 1996) (stating that the
“‘redressability’ element of standing” asks “whether a federal court has the power to grant [the
plaintiff’s requested] relief”); accord M.S. v. Brown, 902 F.3d 1076, 1083 (9th Cir. 2018) (stating
that “even where a plaintiff requests relief that would redress her claimed injury, there is no
redressability if a federal court lacks the power to issue such relief”). Here, Plaintiff asserts that
the court can redress his claimed injuries by (1) refunding his $5 registration fee, (2) compensating
him for the lost use of the $5 fee, and (3) awarding him statutory damages under the Privacy Act
“as a result of the FAA’s unlawful, intentional, and willful conduct.” Pl.’s Opp’n at 9. The court
lacks the power to grant these forms of relief.
The court cannot award Plaintiff a $5 refund, or some lesser amount, to compensate him
for the lost time value of money. As the FAA correctly points out, making Plaintiff whole for the
lost use of $5 over a two-year period would be tantamount to an award of interest. See Holland v.
Bibeau Const. Co., 774 F.3d 8, 17 (D.C. Cir. 2014) (“Interest merely equalizes the time value of
money, making the same amount similarly valuable when paid at different times.”); Motion Picture
Ass’n of Am., Inc. v. Oman, 969 F.2d 1154, 1157 (D.C. Cir. 1992) (observing that “interest
10
compensates for the time value of money”). But, absent an express waiver of sovereign immunity,
an award of interest cannot be recovered against the United States. See Library of Congress v.
Shaw, 478 U.S. 310, 311 (1986) (holding that “interest cannot be recovered in a suit against the
Government in the absence of an express waiver of sovereign immunity from an award of
interest”); accord Thompson v. Kennickell, 797 F.2d 1015, 1020 (D.C. Cir. 1986) (“Absent a
clearly manifested congressional decision to waive the traditional ‘no-interest rule’ in government
suits, we cannot award . . . interest in this case.”). Neither the Privacy Act nor the Little Tucker
Act—the only statutory claims advanced by Plaintiff—provide such a waiver. Moreover, Plaintiff
cannot avoid the bar of the “no-interest” rule by recharacterizing his claimed injury as
compensatory “damages.” “[T]he character or nature of ‘interest’ cannot be changed by calling it
‘damages,’ ‘loss,’ ‘earned increment,’ ‘just compensation,’ ‘discount,’ ‘offset,’ or ‘penalty,’ or any
other term, because it is still interest and the no-interest rule applies to it.” Shaw, 478 U.S. at 321
(quoting United States v. Mescalero Apache Tribe, 518 F.2d 1309, 1322 (Ct. Cl. 1975)). Plaintiff’s
claim for the lost use of the $5 fee is a demand for interest. Therefore, the court lacks the power
to redress Plaintiff’s asserted injury of the lost time value of money.
The court likewise lacks the power to redress Plaintiff’s purported harm arising out of the
FAA’s unauthorized retention of his personal information. As discussed, Plaintiff does not allege
that he suffered any actual harm stemming from the FAA’s collection of his information. Instead,
what he appears to assert is that the agency’s mere violation of the Privacy Act entitles him to a
statutory award of at least $1,000 plus attorney’s fees and costs. See Compl. ¶ 40 (citing 5 U.S.C.
§ 522a(g)(4)). The Supreme Court, however, squarely foreclosed that possibility in Doe v. Chao.
There, the Court held that “[t]he ‘entitle[ment] to recovery’ necessary to qualify for the $1,000
minimum is not shown merely by an intentional or willful violation of the Act producing some
11
adverse effect. The statute guarantees $1,000 only to plaintiffs who have suffered some actual
damages.” 540 U.S. at 627. Later, in FAA v. Cooper, the Court clarified that the term “actual
damages” as used in the Privacy Act refers only to “proven pecuniary or economic harm.” 566
U.S. 284, 299 (2012).
Here, Plaintiff’s Complaint contains no factual basis from which the court can plausibly
infer that it would have the power to award him the minimum $1,000 statutory award to redress
his claimed injury. Having made no allegation whatsoever of pecuniary or economic harm caused
by the alleged Privacy Act violation, the court is foreclosed from granting the $1,000 statutory
award he seeks.
C. Causation
A brief word about causation before concluding. As to that element, a plaintiff must allege
an injury that is “fairly traceable to the defendant’s allegedly unlawful conduct.” Lujan, 504 U.S.
at 590. He cannot, however, “manufacture standing merely by inflicting harm on [himself] . . . ”
Clapper v. Amnesty Int’l. USA, 568 U.S. 398, 416 (2013); accord Nat’l Family Planning and
Reproductive Health Ass’n, Inc. v. Gonzales, 468 F.3d 826, 831 (D.C. Cir. 2006) (“We have
consistently held that self-inflicted harm doesn’t satisfy the basic requirements for standing.”).
Here, to some degree, Plaintiff has brought harm upon himself. He did not avail himself
of the opportunity that the FAA afforded registrants post-Taylor to request both a refund and
removal of his personal information from the agency’s database. Had he done so, Plaintiff would
have achieved much of what he now seeks, at least on his own behalf, through this lawsuit. The
return of the $5 application fee when the FAA offered it would have reduced the lost time value
of money, and the deletion of his personal information would have ended the agency’s possession
12
of it. There would have been little to remedy at the time he filed suit. Thus, the injury he now
claims feels manufactured.
In any event, the court forgoes making any finding as to causation, because the FAA has
not argued that the element is lacking and the absence of the remaining two elements is sufficient
to conclude Plaintiff does not have standing.
V. CONCLUSION AND ORDER
For the foregoing reasons, Defendant’s Motion to Dismiss is hereby granted. Unless
Plaintiff seeks to amend his Complaint within 14 days, the court will enter a final, appealable order.
Dated: November 26, 2018 Amit P. Mehta
United States District Judge
13