Housing Authority of the City of Slidell ( 2020 )

In the United States Court of Federal Claims
No. 19-1583C
(Filed: August 25, 2020)
)
HOUSING AUTHORITY OF THE CITY )
OF SLIDELL, Duty of candor; judicial estoppel;
)
Boaz v. United States; Greenleaf
)
Plaintiff, Limited Partnership v. Illinois
)
Housing Development Authority;
)
Tucker Act jurisdiction; Housing
v. )
and Urban Development; annual
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THE UNITED STATES, contributions contract; breach of
)
contract; money damages.
)
Defendant. )
ORDER
SOLOMSON, Judge.
In the corporate world, a common theme is that members of a high-functioning
team should assume that their colleagues each act with positive intentions.1 In legal
parlance, we call it the presumption of good faith. In some sense, those who practice
before the Court are on the same team; that is, despite our adversarial system of
litigation, we are all participants in a process where the ultimate goals are to determine
the truth and to arrive at a just outcome, consistent with the law.2 In that regard, the
1 Jim Haudan, How the Worst Leaders Destroy Trust in the Workplace, Inc. (Apr. 21, 2016),
https://www.inc.com/jim-haudan/this-one-leadership-habit-can-inspire-distrust-in-the-
workplace.html; Erika Andersen, The Best Teams Have These Five Things — Does Yours?, Forbes
(Jul. 13, 2015, 11:19 PM), https://www.forbes.com/sites/erikaandersen/2015/07/13/the-best-
teams-have-these-five-things-does-yours/#46fac827d665; Hanlon’s Razor: Relax, Not Everything
is Out to Get You, Farnam Street, https://fs.blog/2017/04/mental-model-hanlons-razor/(last
visited Aug. 24, 2020).
2United States v. Shaffer Equip. Co., 11 F.3d 450, 457 (4th Cir. 1993) (“Our adversary system for
the resolution of disputes rests on the unshakable foundation that truth is the object of the
system’s process which is designed for the purpose of dispensing justice. However, because no
one has an exclusive insight into truth, the process depends on the adversarial presentation of
evidence, precedent and custom, and argument to reasoned conclusions—all directed with
unwavering effort to what, in good faith, is believed to be true on matters material to the
disposition. Even the slightest accommodation of deceit or a lack of candor in any material
undersigned is a firm believer in not imputing ill-will or improper motives to anyone,
absent some concrete evidence warranting a contrary conclusion. But our justice
system only functions properly when litigants and their counsel adhere to the rules,
including, but not limited to, the duty of candor, and to this Court’s orders.
At least twice now in this case, the Department of Justice has made statements to
this Court — regarding the government’s various litigation positions and whether they
may be at all reconciled — that had, at the very least, a misleading effect. Indeed, the
government’s motion to dismiss and oral argument presentation forced the Court to
spend countless hours trying to untangle a hodgepodge of arguments seemingly
thrown against the wall, in order to determine the answer to the question of whether
the Plaintiff, the Housing Authority of the City of Slidell (“HACS”), stated a claim for
breach of contract within this Court’s Tucker Act jurisdiction.3 When this Court
subsequently provided the government with the opportunity to remedy its omissions,
and thereby clarify its position, the government declined to do so, but, in effect, made a
false representation of its position. The government thus appears either to be just trying
to notch wins4 or to avoid saying anything that may jeopardize its appeal in Boaz v.
United States, 19-2325 (Fed. Cir.), pending before our appellate court — the United
States Court of Appeals for the Federal Circuit (e.g., by having to inform that court that
the government’s position constitutes an about-face from what the government told the
United States Court of Appeals for the Seventh Circuit). The Court respects that the
government’s counsel no doubt have a different point-of-view, and that they are
respect quickly erodes the validity of the process.”); Hanover Ins. Co. v. United States, 146 Fed. Cl.
447, 450 (2019) (discussing Shaffer Equip. Co. and noting “the truism that attorneys must not
mislead the court”).
3As detailed in the Court’s decision denying the government’s motion to dismiss, some of those
hours were spent reviewing regulations upon which the Justice Department relied for
particular, material legal assertions, only to have counsel of record abandon such assertions, or
at least the government’s reliance on those regulations, during oral argument. ECF No. 31, Jun.
24, 2020 Tr. 34:18–25 (“THE COURT: There’s a lot of other citations here that I was prepared to
walk through that are not in Section 2 -- that are not in Title 2 CFR. [GOVERNMENT’S
COUNSEL]: Your Honor, I don’t think they necessarily answer your specific questions.
They’re not the specific . . . requirements or conditions that can be implicated. So I don’t know
that they would answer this question.”).
4“It is not the duty of the Justice Department simply to try to win cases for the Government; as
President Lincoln famously said, ‘It is as much the duty of Government to render prompt justice
against itself, in favor of citizens, as it is to administer the same, between private individuals.’”
Byrum v. Office of Pers. Mgmt., 618 F.3d 1323, 1333 & n.6 (Fed. Cir. 2010) (quoting President
Lincoln’s First Annual Message to Congress (Dec. 3, 1861), and noting that “this quotation is
engraved at the entrance to our courthouse”).
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reasonable people who are zealously representing their client, the United States.
Nevertheless, the Court believes itself obligated not to just let this issue go.5
I.
A brief recounting of events in this case is warranted.
In preparation for oral argument on the government’s motion to dismiss for lack
of jurisdiction and for failure to state a claim, this Court ordered the parties to be
prepared to address a number of issues, one of which was whether and how the
government’s position here could be reconciled with its position in a number of United
States district court cases. ECF No. 27 at 2. In those district court cases, the government
argued that claims based on the same type of Department of Housing and Urban
Development (“HUD”) contract at issue in this case — i.e., an Annual Contributions
Contract (“ACC”) — belonged in this Court pursuant to the Tucker Act. See, e.g.,
Greenleaf Ltd. P’ship v. Illinois Hous. Dev. Auth., 2009 WL 449100, at *5–6 (N.D. Ill. Feb. 23,
2009) (concluding that “[plaintiff’s] claims are in substance contract-based actions
asking for monetary relief from HUD”); Vill. W. Assocs. v. Rhode Island Hous. & Mortg.
Fin. Corp., 618 F. Supp. 2d 134, 137 (D.R.I. 2009) (“[A]t bottom [plaintiff] seeks money
damages . . . grounded upon rights that spring from the ACC contract. Thus, the action
falls within the Tucker Act, 28 U.S.C. § 1491, and the exclusive forum is the United
States Court of Federal Claims[.]”).6 In this case, in contrast, the government maintains
that HACS’s claims belong in a district court pursuant to the Administrative Procedure
Act (“APA”). ECF No. 22 (“Def. Mot.”) at 10 (“This is a lawsuit under the APA, which
must be filed in district court[.]”).7
5United States Dep’t of Hous. & Urban Dev. v. Cost Control Mktg. & Sales Mgmt. of Va., Inc., 64 F.3d
920, 925 (4th Cir. 1995) (“[A] lawyer’s duty of candor to the court must always prevail in any
conflict with the duty of zealous advocacy.”); Martrano v. Quizno’s Franchise Co., 2009 WL
1704469, at *3 n.11 (W.D. Pa. June 15, 2009) (“Counsel are cautioned that zealous advocacy must
be tempered by observance of the duty of candor toward a tribunal.”).
6In an earlier decision, this Court cataloged a number of cases which reached the same
conclusion(s) based on the government’s arguments — i.e., that ACC breach claims should be
viewed as ordinary breach of contract actions which seek monetary damages, rather than
equitable relief (and, thus, jurisdiction is proper in this Court pursuant to the Tucker Act).
Hous. Auth. of Slidell v. United States, -- Fed. Cl. --, 2020 WL 4593229, at *25 n.52 (Fed. Cl. July 27,
2020).
7In contrast to the government’s argument in its motion to dismiss, counsel for the government
during oral argument was non-committal regarding whether breach of ACC claims properly
may be brought in a district court pursuant to the APA. Jun. 24, 2020 Tr. 94:15–23
(“[GOVERNMENT’S COUNSEL]: Sitting here today, I’m not willing to bind my colleagues in
whichever district of Louisiana. . . . I do think that that . . . this is the question of whether there
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During oral argument, counsel of record for the United States informed this
Court that the government’s various positions were not inconsistent because the
government previously had reversed its own view regarding this Court’s jurisdiction
over ACC breach claims. See Jun. 24, 2020 Tr. 65:14–66:9. Particularly, the government’s
counsel pointed to a confession of error that had been authorized by the Office of the
Solicitor General (“OSG”) and submitted to the United States Court of Appeals for the
Seventh Circuit. The government relied upon that confession of error in this case to
establish the government’s current position concerning ACC breach claims: the district
court properly has jurisdiction over ACC breach claims. At least, that is how counsel for
the government presented the confession of error brief. Thus, counsel of record for the
government in this case avoided questions regarding how and why the government at
one point contended that jurisdiction was proper only in this Court pursuant to the
Tucker Act, but then contended that jurisdiction over HACS’s claims is proper, if
anywhere, only in the district court.
Put yet differently still, the government’s asserted solution to the apparent
contradictory positions was that, ever since its confession of error before the Seventh
Circuit, the government has maintained that the district court (and not the United States
Court of Federal Claims) has jurisdiction over ACC breach claims. See Jun. 24, 2020 Tr.
66:3–9 (“THE COURT: So now, the consistent position of the United States Government
is that ACC claims belong in District Court. [GOVERNMENT’S COUNSEL]: Yes, Your
Honor. . . . That finding -- the confession of error is consistent with the position in this
case, yes.”). The Court concluded that statement is false, see Hous. Auth. of Slidell, 2020
WL 4593229, at *24–25, and the Court still struggles to understand why the government
did not provide a fulsome explanation at oral argument of the position it had taken
before the Seventh Circuit and then declined the opportunity to explain itself in writing.
See ECF No. 35, Aug. 19, 2020 Tr. 14:3–15.
Thus, an obstacle this Court faced in resolving the government’s motion to
dismiss is that the government’s counsel inaccurately explained the confession of error
before the Seventh Circuit. Far from asserting that the district court has exclusive
jurisdiction over ACC breach claims, the government’s confession of error in fact
admitted only that HUD’s “sue-and-be-sued” clause provided for concurrent jurisdiction
with this Court’s Tucker Act jurisdiction over what were indisputably government
contract breach claims. See Hous. Auth. of Slidell, 2020 WL 4593229, at *23. Counsel for
the government did not inform the Court during oral argument that, in its Seventh
Circuit confession of error brief, the government continued to argue that: (1) the district
court lacked APA jurisdiction over ACC breach of contract claims (contrary to the
is APA jurisdiction over the Section 8 cases. My expectation is [] that would be similar to the
position that we would have here.”).
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government’s position in this case); and (2) such contract claims could be brought in
this Court pursuant to the Tucker Act. Brief For Federal Third-Party
Defendant/Appellee, ECF No. 23 at 7, 9 n.3, Greenleaf Ltd. P’ship v. Illinois Hous. Dev.
Auth., 2012 WL 1226060, at *7, *9 n.3 (7th Cir. Apr. 2, 2012) (No. 11-1753). Counsel for
the government did not file the Seventh Circuit confession of error brief in advance of
the oral argument, did not read any part of it to the Court during oral argument, and
did not file any explanation of that brief following the oral argument.
Whether counsel for the government mischaracterized the confession of error —
or otherwise omitted its details — for the express purpose of avoiding the Court’s
(possibly) difficult or uncomfortable questions, or whether the error was inadvertent,
this Court could not say for certain (although we presumed good faith). After
discovering the error, however, this Court expressed concerns — at some length —
regarding the government’s litigation strategy and its counsel’s duty of candor. See
Hous. Auth. of Slidell, 2020 WL 4593229, at *25 (“The government has not adequately
explained its evolving views of Tucker Act jurisdiction; the government's position in
this case is all but impossible to reconcile with the details of the confession of error brief
filed in the Seventh Circuit. This is not the first time this Court (or the Federal Circuit,
for that matter) has been critical of the government’s ad-hoc approach to jurisdictional
issues.”); id. at n.54 (citing cases in support of the proposition that the purpose of
judicial estoppel and the insistence that parties not adopt inconsistent positions is to
prevent parties from “playing fast and loose with the courts” (quoting Scarano v. Central
R.R., 203 F.2d 510, 513 (3d Cir. 1953))).
Although this Court denied the government’s motion to dismiss, the Court
specifically provided the government with an opportunity to cure its “fail[ure] to
mention . . . during oral argument [that] the government expressly argued to the
Seventh Circuit that the district court’s jurisdiction was not exclusive, but rather was
concurrent with the Court of Federal Claims[.]” Hous. Auth. of Slidell, 2020 WL 4593229,
at *23. Accordingly, this Court informed the government as follows:
Particularly because the Court gave the government fair
warning about the Court’s interest in understanding the
government’s position in Greenleaf (and similar district court
cases), see ECF No. 27 at 2, the Court rejects the government’s
fractional explanation provided during oral argument. The
Court nevertheless will provide the government yet another chance
to explain itself. At some point, however, this Court (or the Federal
Circuit) will have to do more than simply issue critiques or
admonishments, particularly when plaintiffs are made the subject of
actual or attempted “jurisdictional ping pong.”
-5-
Id. at *25 (emphasis added) (quoting Christianson v. Colt Indus. Operating Corp., 486 U.S.
at 818–19 (1988)). As explained in more detail below, the time for this Court “to do
more” has arrived.
II.
As noted above, this Court provided the government with an opportunity to
explain its deficient oral argument presentation regarding the confession of error filed
in the Seventh Circuit, as well as the government’s position concerning the district court
decisions this Court identified prior to oral argument. In particular, the Court ordered as
follows:
[I]f the Justice Department’s Commercial Litigation Branch,
after consulting with the Office of the Solicitor General (“OSG”),
in fact no longer stands by the latter’s view of the Tucker Act
and the APA — in the context of an alleged breach of an ACC
— as articulated in the confession of error brief submitted to
the Seventh Circuit in Greenleaf, the government may file a
supplemental brief on or before August 10, 2020, not to
exceed five (5) pages. In that brief, the government shall
explain the reason for its revised view, as well as how its new
position fits with the government’s representations at oral
argument.
Alternatively, if the government believes that the Greenleaf
ACC provisions and/or the claims at issue in that case are
distinguishable — for jurisdictional purposes — from those at
issue here, the government may file a supplemental brief on
or before August 10, 2020, not to exceed five (5) pages, in
which the government shall compare the various ACC
provisions and claims. Such supplemental brief shall include
as attachments both the complaint against HUD in Greenleaf,
as well as the operative ACC(s) in that case.
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The government may file only one of the supplemental briefs
specified above. To be clear, given the government’s reliance
upon the above-discussed Seventh Circuit briefing, the
government — with respect to either optional supplemental
brief — shall consult with, and include a representation that
it has cleared its position with, the OSG.
Hous. Auth. of Slidell, 2020 WL 4593229, at *32.
Critically, the Court warned the government that its failure to file either
supplemental brief would constitute a specific and unequivocal representation to the
Court:
If the government elects not to file either supplemental brief,
the Court will understand that to mean that the government’s
current view is consistent with its position taken before the
Seventh Circuit, and that such position, having been accepted
by this Court as well, required the denial of the government’s
motion to dismiss for lack of jurisdiction here.
Id. Accordingly, this is not a case where the government’s silence could be
misconstrued in any way. Rather, this Court made clear to the government that its
election not to file a supplemental brief would be viewed as the government’s having
made a very precise representation to this Court, one that would significantly
undermine not only the validity of the government’s arguments in its motion to
dismiss, but also the veracity of its representations during oral argument.8
8 See Ingaseosas Int’l Co. v. Aconcagua Investing Ltd., 479 F. App’x 955, 960 n.10 (11th Cir. 2012)
(“[C]ounsel, by its silence, implicitly agreed to entry of the stay.”); In re Marriage of Lionberger, 97
Cal. App. 3d 56, 62 (Ct. App. 1979) (“The silence of counsel under the circumstances, on two
occasions in open court, is tantamount to assent to the provision . . . and that assent is binding
on appellant[.]”); Decker v. Norfolk S. R. Co., 83 S.E. 27, 28 (N.C. 1914) (discussing the ancient
principle of “qui tacet, consentire videtur” and explaining that “the silence of counsel implied
their assent to the course adopted by the judge, and ‘a man who does not speak when he ought
shall not be heard when he desires to speak’” (citations omitted)); Scott-Iverson v. Indep. Health
Ass’n, Inc., 2016 WL 3444226, at *3 (W.D.N.Y. June 23, 2016) (“Plaintiff’s agreement to the
stipulation may be inferred from the Plaintiff’s counsel’s silence or failure to respond to [the] e-
mail expressly sent to confirm such stipulation.”); BMO Harris Bank N.A. v. Stoebner, 2015 WL
13858611, at *5 n.4 (D. Minn. Jan. 8, 2015) (“Within this context, the Bankruptcy Court properly
took counsel’s silence as assent that the sole issue for trial would be insolvency.”); Siegel v.
Warner Bros. Entm’t Inc., 2007 WL 9627501, at *6 (C.D. Cal. Oct. 23, 2007) (“The Court construes
such silence as plaintiffs’ counsel’s acquiescence…”); Hartford Elec. Supply Co. v. Allen-Bradley
Co., 2000 WL 1918005, at *5 (Conn. Super. Ct. Dec. 18, 2000) (“Our law is clear that ‘consent’ or
‘assent’ may be inferred from the attendant circumstances and conduct of the parties. . . . The
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Insofar as the Court understood that, if the government indeed stood by “its
position taken before the Seventh Circuit, and that such position, having been accepted
by this Court as well, required the denial of the government’s motion to dismiss for lack
of jurisdiction here[,]” 2020 WL 4593229, at *32, this Court fully expected the
government to have filed one of the two specified supplemental briefs. This is because
the Court believed that were the government not to file a supplemental brief, the
government likely would have had to withdraw its appeal in Boaz — a result the Court
viewed as unlikely. Thus, this Court was surprised when August 10, 2020 came and
went, and the government did not file a supplemental brief in this case.
Believing that the government thus must have changed its position regarding
Boaz, the Court then checked the Federal Circuit’s docket in that case. To the Court’s
surprise, however, the appeal remained pending; no related cases had been identified,
no Rule 28(j) letter appeared to have been submitted, and, in turn, this Court’s
confusion regarding the government’s various positions was compounded. 9
In particular, the government previously had argued that the undersigned
should not follow Judge Kaplan’s decision in Boaz because it would be reversed on
appeal. Def. Mot. at 24 (contending that “Boaz misapplied the Federal Circuit’s holding
in San Juan [City College v. Unites States, 391 F.3d 1357 (Fed. Cir. 2004] . . . [and]
improperly disregarded the Federal Circuit’s decisions [in] Lummi [Tribe of the Lummi
Reservation, Washington v. United States, 870 F.3d 1313 (Fed. Cir. 2017)] and [Nat’l Ctr. for
Mfg. Sciences v. United States, 114 F.3d 196 (Fed. Cir. 1997)] on at least two erroneous
grounds.”).10 In light of the government’s seeming admission that this Court does
ancient maxim ‘silence gives consent’ permits the inference that a party who is silent intends to
consent or assent, when no other explanation is consistent with silence.”). The referenced
“ancient maxim” that “silence is tantamount to an admission” is at least as old as the Talmud,
which dates back to approximately 500 C.E. See Babylonian Talmud, Bava Metzia 37b.
9Notably, although the government’s opening brief in the Boaz appeal contained a notice of
related cases, Brief of the United States, ECF No. 14 at 2, Boaz v. United States, No. 19-2325 (Fed.
Cir. Jan. 31, 2020), the government’s final corrected brief contains no such notice. See generally
Corrected Brief of the United States, ECF No. 35, Boaz v. United States, No. 19-2325 (Fed. Cir. Jul.
21, 2020). It is entirely unclear whether the government has informed the Federal Circuit of the
government’s confession of error brief in the Seventh Circuit or the government’s prior position
in the district court cases involving ACCs that this Court cataloged in its decision denying the
government’s motion to dismiss in this case. Hous. Auth. of Slidell, 2020 WL 4593229, at *24 n.52.
10In the government’s motion to dismiss briefs, at oral argument, and then again during the
August 19, 2020 status conference discussed in further detail below, the government repeatedly
has relied upon the Federal Circuit’s decision in Lummi in support of its position that this Court
lacks jurisdiction over ACC breach claims, like the one HACS asserts here. See Jun. 24, 2020 Tr.
43:16–19; Aug. 19, 2020 Tr. 9:16–19. During oral argument, however, the Court directed the
government to subsequent history in Lummi which demonstrates that the government’s reliance
upon the case is erroneous. Jun. 24, 2020 Tr. 89:20–91:6 (discussing Lummi Tribe of the Lummi
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possess jurisdiction, however, this Court hypothesized that perhaps the government
now believed that Boaz and this case were themselves distinguishable such that
jurisdiction in fact was proper in this case, but not in Boaz. Because the government’s
position and its peripatetic and situational views regarding this Court’s jurisdiction
required some further explanation, and in light of the still-pending Boaz appeal, the
Court ordered a status conference to determine whether the government indeed held a
uniform position regarding ACC breach claims that could account for the government’s
various positions. ECF No. 33.
III.
On August 19, 2020, the Court held a telephonic status conference to address
these issues. The Court began the status conference by asking counsel for the
government whether — by not having filed a supplemental brief — the government
essentially had confessed error regarding its jurisdictional position in this case:
THE COURT: . . . I was very surprised that August 10th came
and went and no brief was filed about Greenleaf, where I gave
the Government an additional chance to explain itself in terms
of its position in oral argument and how I read, I think pretty
clearly, the filings in that case. So . . . my first question for you
is . . . -- am I correct to assume, then, that the Government is
acquiescing in my final paragraph of that [July 27, 2020]
order?
Reservation, Washington v. United States, 788 F. App’x 717, 721 (Fed. Cir. 2019) (holding that
“Lummi’s breach of contract, breach of fiduciary duty, and breach of trust claims were therefore
not with within the scope of our prior mandate” and that the “prior mandate resolved only the
question of the Claims Court’s jurisdiction of Lummi’s NAHASDA and illegal exaction
claims”)). The Court’s decision denying the government’s motion to dismiss in this case
emphasized this point. Hous. Auth. of Slidell, 2020 WL 4593229, at *24. Yet, prior to oral
argument the government never identified for the Court the subsequent relevant precedent in
Lummi. Indeed, despite the Court’s having brought this to the government’s attention, twice
now, the government continues to rely upon Lummi. Aug. 19, 2020 Tr. 9:16–19. The Court
reserves judgment as to whether the government’s failure to identify adverse precedent itself
constitutes a breach of the duty of candor. See, e.g., Jorgenson v. Cnty. of Volusia, 846 F.2d 1350,
1351–52 (11th Cir. 1988) (affirming the trial court’s imposition of sanctions against counsel for
failing to identify relevant adverse precedent); Golden Eagle Distrib. Corp. v. Burroughs Corp., 801
F.2d 1531, 1542 (9th Cir. 1986) (“A lawyer should not be able to proceed with impunity in real or
feigned ignorance of authorities which render his argument meritless[.]”); see also Precision
Specialty Metals, Inc. v. United States, 315 F.3d 1346, 1356 (Fed. Cir. 2003) (discussing the
application of Rule 11 to attorney-case-citation issues).
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[GOVERNMENT’S COUNSEL]: Your Honor, we do not
believe that the position that we have taken in this case and
that the Government took in Greenleaf are inconsistent. We do
recognize that the Court has – frankly, the Court addressed –
considered and rejected the arguments that we would have
presented in any such filing. And as Your Honor indicated,
we didn’t want to waste the Court’s or the parties’ time given that
those arguments had already been addressed. We understand that
the motion had been – we believe the – our understanding
was that the motion had been denied. And to the extent that
any, I guess, reconsideration was offered, we didn’t believe that
it would meaningfully advance the case. And we are prepared to
move forward with the case. I just – as a secondary note, we
also considered very seriously Your Honor’s caution that any
filing be reviewed or cleared by the Solicitor General, and we
didn’t believe that it was warranted to seek that office’s input.
Aug. 19, 2020, Tr. 5:18–6:20 (emphasis added).
None of those rationales presented during the status conference justify the
government’s failing to adhere to the Court’s July 27, 2020 Order, which, under the
circumstances as the Court now understands them, required a specified supplemental
brief. To be clear: while the Court unquestionably provided the government with the
flexibility not to file a supplemental brief, the government’s failure to do so constituted
a representation to the Court that was false and thus violated the duty of candor to
which the Justice Department (and all counsel) are expected to adhere. The government
could have asked for clarification of the Court’s July 27, 2020 Order. The government
could have asked for relief from the Court’s July 27, 2020 Order. The government could
have asked for an extension of time to consult with the OSG or simply to prepare
whichever of the two supplemental briefs the government elected to file. The
government did none of those things, but instead entirely disregarded the Court’s July
27, 2020 Order. How does the Court know this? The government admitted as much
during the status conference, and, when pressed, rejected the very representation that
the Court ordered would be attributed to the government upon its electing not to file
either specified supplemental brief. Indeed, the government admitted that its true view
is that which should have been explained in the second alternative supplemental brief
described in the Court’s July 27, 2020 Order:11
[GOVERNMENT’S COUNSEL]: [T]o the extent that one of
those two buckets of briefing is applicable, it -- it would most
closely be the second.
11 Hous. Auth. of Slidell, 2020 WL 4593229, at *32.
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THE COURT: I think so.
[GOVERNMENT’S COUNSEL]: I think . . . our position is
that they are distinguishable. It is, as I mentioned, a position
that I believe the Court has already rejected. . . . And I -- just
to clarify, I think part of the reason we -- well, the ACC
provisions are not where we are finding the distinction. The
distinction is coming from the complaints filed in the separate cases.
Aug. 19, 2020, Tr. 13:10–14:24 (emphasis added).
The government entirely missed the point of this Court’s July 27, 2020 Order.
The fact that this Court had reached a conclusion based on the parties’ briefs and their
oral argument does not preclude or otherwise constrain this Court from ordering
supplemental briefing to further aid the Court. For example, the Court may order
further briefing for a variety of reasons, including (1) to confirm that it has reached the
correct conclusion, (2) to further clarify the parties’ positions for the purposes of future
proceedings, (3) to permit the Court, sua sponte, to reconsider its position, (4) to rectify a
counsel’s (possible) violation of the duty of candor, or (5) to attempt to avoid the type of
improper position shifting that the doctrine of judicial estoppel is designed to prevent.
Moreover, the fact that counsel for the government during the status conference
attempted to distinguish the government’s varying positions based upon the nature of
“the complaints filed in the separate cases[,]” Aug. 19, 2020 Tr. 14:23–24, highlights
precisely why the Court ordered that a supplemental brief espousing that position had
to “compare the various ACC provisions and claims” and “include as attachments both
the complaint against HUD in Greenleaf, as well as the operative ACC(s) in that case.”
Hous. Auth. of Slidell, 2020 WL 4593229, at *32.
Simply put, the government’s explanation for violating this Court’s July 27, 2020
Order does not add up. The July 27, 2020 Order did not provide that the government
could decline to file any supplemental brief, while still avoiding the specified admission
of error regarding jurisdiction. The fact that the government did not wish to seek
reconsideration is immaterial, and any assumption that this Court could not undertake
such reconsideration sua sponte would be patently incorrect. See Rules of the United
States Court of Federal Claims (“RCFC”) 12(h)(3) (“If the court determines at any time
that it lacks subject-matter jurisdiction, the court must dismiss the action.”).
After further considering the government’s explanations during the status
conference, the Court holds that nothing in the Court’s July 27, 2020 Order permitted
the government to both (1) decline to file a supplemental brief (based on the
government’s unilateral determination that nothing would be accomplished), and
(2) simultaneously avoid an admission that the Court properly denied the government’s
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motion based upon the government’s position before the Seventh Circuit (and the
district courts). Put yet differently, the government improperly elected a fourth option
for which the Court’s July 27, 2020 Order did not provide: to decline to file a
supplemental brief, while taking an undisclosed, stealth position contrary to the Court’s
Order.12 The election of that non-existent option violated the Court’s July 27, 2020
Order and the duty of candor.
IV.
This Court once again readily acknowledges that judicial estoppel cannot create
jurisdiction where none exists. Hous. Auth. of Slidell, 2020 WL 4593229, at *25 n.53; see
Dunklebarger v. Merit Sys. Prot. Bd., 130 F.3d 1476, 1480 (Fed. Cir. 1997) (citing Ins. Corp.
of Ireland v. Compagnie des Bauxites de Guinee, 456 U.S. 694, 702 (1982), for the proposition
that “the principles of estoppel do not apply to vest subject-matter jurisdiction where
Congress has not done so[]”). But, that does not mean that courts lack the inherent
authority (or pursuant to the Court’s Rules) to devise and impose sanctions to preclude
parties from engaging in gamesmanship.13 Republic of Ecuador v. Connor, 708 F.3d 651,
657 (5th Cir. 2013) (“From the standpoint of equity, as most federal courts recognize, a
change of legal position can be just as abusive of court processes and an opposing party
as deliberate factual flip-flopping.”). As this Court noted in denying the government’s
motion to dismiss, “’[i]n order to promote consistent candor in litigation, judicial
estoppel permits courts to sanction parties who adopt irreconcilably inconsistent
positions in litigation[.]’” Hous. Auth. of Slidell, 2020 WL 4593229, at *25 n.54 (quoting
Jackson v. WellSpan Health, 2014 WL 414251, at *1 (M.D. Pa. Feb. 4, 2014)).
In other words, “[t]he purpose of the [judicial estoppel] doctrine is to protect the
integrity of the judiciary by preventing a party from convincing two different courts of
contradictory positions, which would mean that one of those two courts was deceived.”
Audio Technica U.S., Inc. v. United States, 963 F.3d 569, 575–76 (6th Cir. 2020) (noting,
however, that “judicial estoppel is construed even more narrowly when requested
against the government”); see Republic of Ecuador, 708 F.3d at 654 (“Judicial estoppel is
an equitable doctrine designed to protect the integrity of judicial proceedings by
preventing litigants from asserting contradictory positions for tactical gain.”); Shaffer
Equip. Co., 11 F.3d at 458–59 (“The general duty of candor and truth thus takes its shape
from the larger object of preserving the integrity of the judicial system.”).
12Perhaps the government reasoned that because it could not be estopped at a later date
regarding jurisdiction (i.e., particularly should the government succeed in the Boaz appeal), it
also could not be sanctioned for inconsistent positions. Such a conclusion appears incorrect.
13“Such cynical gamesmanship and deliberate obfuscation wastes the Court’s time, virtually
ensures duplicative proceedings will be necessary, is inconsistent with Counsel’s duty of
candor, and constitutes bad faith.” Dillon v. BMO Harris Bank, N.A., 2016 WL 5679190, at *19
(M.D.N.C. Sept. 30, 2016).
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The government’s error here was not merely “being wrong in choice of theory or
miscalculation of facts necessary to sustain the theory[.]” 1-10 Indus. Assocs., LLC v.
United States, 528 F.3d 859, 870 (Fed. Cir. 2008) (analyzing a putative breach of the duty
of candor under RCFC 11, and citing Motown Prods., Inc. v. Cacomm, Inc., 849 F.2d 781,
785 (2d Cir. 1988) for the proposition that a “distinction . . . must be drawn between a
position which is merely losing and one which is both losing and sanctionable”). In 1-
10 Indus. Assocs., the Federal Circuit held that the “Court of Federal Claims erred when
it read into [the government’s counsel’s] response an assertion” that the court already
knew not to be true. 528 F.3d at 870. Thus, the court “could not have been misled as to
the truth, especially since [the government’s counsel] . . . made no affirmative
representation[.]” Id. Here, the problem is that in declining to file a supplemental brief,
the government not only failed to clarify its erroneous explanation of Greenleaf provided
to the Court at oral argument, but also failed to disclose to the Court the government’s
true view regarding this Court’s jurisdiction over ACC breach cases. In contrast to the
facts at issue in 1-10 Indus. Assocs., the government in this case in effect affirmatively
represented to this Court a view of jurisdiction to which the government does not, in
fact, subscribe. Furthermore, unlike in 1-10 Indus. Assocs., the Court had no way of
knowing the truth. There was, and still is, no way for this Court to know how the
government’s view of HACS’s claims fits with the position the government took before
the Seventh Circuit, whether the different positions are reconcilable, or how either
position fits with the government’s position in the Boaz appeal.14
The government’s disregard of the Court’s Order is not innocuous. A fulsome
explanation of the government’s various positions — one this Court has now twice
ordered the government to provide — might persuade the Court that it does not have
jurisdiction over this case, or might persuade HACS to voluntarily dismiss its case, to
seek a transfer to district court, or to request a stay pending the resolution of Boaz.15 On
the flip side, had the government followed this Court’s instructions to provide a more
robust explanation of the government’s various positions, the government would have
14The government’s hypothesizing of a distinction between Section 8 and Section 9 funds, when
all of the cases at issue involve ACC breach claims, does not even begin to answer the mail.
Aug. 19, 2020 Tr. 16:5–10. For the Court to entertain the alleged distinction between claims
involving Section 8 funds and those concerning Section 9 funds, we will require an actual
explanation of the government’s thesis. The government cannot toss out such a bald assertion,
without further explanation, and then use that as a basis to avoid the inconsistencies. The
government has raised the point, and now the government must explain itself in writing. The
same holds true for the government’s continued reliance on Lummi.
15Indeed, HACS’s counsel was as confused as the Court regarding the government’s position
on jurisdiction due to the government’s failure to file a supplemental brief. See Aug. 19, 2020 Tr.
16:19–17:5 (“[PLAINTIFF’S COUNSEL]: We would just say that it was clear to us that we were
operating as if that deadline had passed and there was an acquiescence on that issue.”).
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had an opportunity for further deliberation, and may have concluded that its current
position is erroneous. It is for these precise reasons that this Court ordered both that
counsel be prepared to discuss these issues “in detail” during oral argument, ECF No.
27 at 1 (emphasis added), and to brief the issues further depending on whether or not
the government was willing to concede the error of its jurisdictional arguments, just as
it had done before the Seventh Circuit. Nevertheless, in contravention of those orders,
the government still has not provided a fulsome articulation of how its various
positions may be reconciled, let alone a clear explanation of what its position even is.
All of the aforementioned goals of both the pre-oral argument Order, see ECF No.
27, as well as the supplemental briefing Order, Hous. Auth. of Slidell, 2020 WL 4593229,
at *32, are well within the Court’s power to pursue. Still, the government apparently
thinks that its ability to avoid estoppel means that it can disregard this Court’s orders or
that the duty of candor somehow does not apply to jurisdictional legal issues. That is
not the case. Sexual Minorities Uganda v. Lively, 899 F.3d 24, 34 (1st Cir. 2018) (explaining
that defendant and its “counsel owed a duty of candor to the district court[;] . . . they
told that court that diversity jurisdiction did not exist; and they secured a dismissal of
the pending federal suit, partially as a result of that disclaimer. When a party makes a
representation to a court, there is no unfairness in insisting that he live with its
consequences.”); Ward v. Marathon Ashland Petroleum LLC, 2006 WL 1984711, at *1 (N.D.
W.Va. July 13, 2006) (citing Burns v. Windsor Ins. Co., 31 F.3d 1092, 1095 (11th Cir. 1994)
for the proposition that “that an attorney’s duty of candor imposed by Rule
11 . . . should prevent the plaintiff’s attorneys from using deceptive practices to avoid
federal court jurisdiction”).
Courts consistently have held that “counsel for the government, no less than
their colleagues in the private sector, are bound by the same obligations to the court.
There is, indeed, much to suggest that government counsel have a higher duty to uphold
because their client is not only the agency they represent but also the public at large.”
Gray Panthers v. Schweiker, 716 F.2d 23, 33 (D.C. Cir. 1983) (emphasis added); In re
Witness Before Special Grand Jury 2000–2, 288 F.3d 289, 293 (7th Cir. 2002)
(“[G]overnment lawyers have responsibilities and obligations different from those
facing members of the private bar. While the latter are appropriately concerned first
and foremost with protecting their clients—even those engaged in wrongdoing—from
criminal charges and public exposure, government lawyers have a higher, competing
duty to act in the public interest.”).
V.
The Court has the power — and, more importantly, the duty — to have the
parties answer its questions. Cf. Kennedy v. Lockyer, 379 F.3d 1041, 1058–59 (9th Cir.
2004) (Fisher, J., concurring) (discussing a court’s ability to ask questions so as to clarify
the parties’ respective positions); see also Jones v. Page, 76 F.3d 831, 850 (7th Cir. 1996)
(noting that a judge “has an obligation to raise legal issues that the parties have
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overlooked or neglected”). The Court certainly has the discretion to seek answers to its
questions via oral argument or, subsequently, in a supplemental brief. See, e.g., Austin
v. United States, 128 Fed. Cl. 314, 321 (2016) (providing parties the opportunity to file
supplemental briefs in order to clarify unresolved questions). That is particularly true
where the Court’s questions arise from the erroneous or misleading answers of one of
the parties. Cf. United States v. Musick, 291 F. App’x 706, 728 n.5 (6th Cir. 2008)
(suggesting that a Federal court should ask for supplemental briefing if an “omission
was [] material and [thus] prevent[s] [the court] from understanding or fully
considering appellant’s argument”).
For now, the Court reserves judgment on whether the government should be
sanctioned in some manner, but rather ORDERS as follows:
1. The government shall file a supplemental brief explaining how the Greenleaf ACC
provisions and the claims that were at issue in that case are distinguishable — for
jurisdictional purposes — from those at issue here. The government shall specifically
compare the language of the various ACC provisions and claims in the two cases.
2. Such supplemental brief shall include as attachments both the complaint against
HUD in Greenleaf, as well as the operative ACC(s) in that case.
3. The government shall further compare in detail the claims and contract provisions at
issue in this case and in Greenleaf with those at issue in Boaz.
4. The government also shall address the impact in this case of the Federal Circuit’s
second decision in Lummi Tribe of the Lummi Reservation, Washington v. United States,
788 F. App’x 717 (Fed. Cir. 2019), and explain why the government did not address,
or even cite, that decision in its motion to dismiss briefing.
5. The supplemental brief must be cleared with, and signed by, an authorized
representative of the OSG.
6. Excluding the aforementioned attachments, the government’s supplemental brief
shall be no more than 25 pages, double-spaced, 12 pt., Times New Roman font.
7. The government’s supplemental brief shall be filed on or before 5:00 p.m. on
Monday, September 24, 2020.
8. HACS shall not file a response unless ordered to do so by the Court.
IT IS SO ORDERED.
s/Matthew H. Solomson
Matthew H. Solomson
Judge
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