Sheila Armstrong v. Mich. Bureau of Servs. for Blind Persons

RECOMMENDED FOR PUBLICATION
Pursuant to Sixth Circuit I.O.P. 32.1(b)
File Name: 20a0249p.06
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
SHEILA ARMSTRONG, ┐
Plaintiff-Appellant, │
│
│
v. > No. 19-2179
│
│
MICHIGAN BUREAU OF SERVICES FOR BLIND PERSONS; │
EDWARD ROGERS, II; TAMELA MEEK; JAMES HULL; │
UNITED STATES DEPARTMENT OF EDUCATION; JOHN │
KING, JR., Secretary of Education, │
Defendants-Appellees. │
┘
Appeal from the United States District Court
for the Western District of Michigan at Grand Rapids.
Nos. 1:16-cv-00345; 1:16-cv-01169—Janet T. Neff, District Judge.
Argued: July 29, 2020
Decided and Filed: August 7, 2020
Before: SUTTON, COOK, and MURPHY, Circuit Judges.
_________________
COUNSEL
ARGUED: W. Dane Carey, DINGEMAN & DANCER, PLC, Traverse City, Michigan, for
Appellant. Christopher W. Braverman, OFFICE OF THE MICHIGAN ATTORNEY
GENERAL, Lansing, Michigan, for State of Michigan Appellees. ON BRIEF: W. Dane Carey,
DINGEMAN & DANCER, PLC, Traverse City, Michigan, for Appellant. Christopher W.
Braverman, OFFICE OF THE MICHIGAN ATTORNEY GENERAL, Lansing, Michigan, for
State of Michigan Appellees.
No. 19-2179 Armstrong v. Mich. Bureau of Servs. for Blind Persons Page 2
_________________
OPINION
_________________
SUTTON, Circuit Judge. The Randolph-Sheppard Act, found at 20 U.S.C. §§ 107 to
107f, requires government agencies to set aside certain contracts for sight-challenged vendors.
Although the law applies primarily to federal agencies, States take the lead in licensing the
vendors and matching them with available contracts. In 2010, the State of Michigan denied
Sheila Armstrong’s bid for a contract to stock vending machines at highway rest stops in the
State. Convinced that the denial stemmed from a record-keeping error, Armstrong complained.
After pursuing relief in state administrative proceedings, federal arbitration, and most recently
the district court, she remains dissatisfied with the results.
Her appeal prompts two questions: Was the unfavorable arbitration decision arbitrary or
capricious under the Administrative Procedure Act? And may Armstrong sue under 42 U.S.C.
§ 1983 to vindicate her rights under the Randolph-Sheppard Act? Because the answer to both
questions is no, we affirm.
I.
Sheila Armstrong earns her living as a licensed vendor with Michigan’s Business
Enterprise Program. The program facilitates efforts by blind vendors to obtain contracts set
aside for them under the Randolph-Sheppard Act and related federal and state laws. 20 U.S.C.
§ 107(b); Mich. Comp. Laws §§ 393.359, 393.363. Passed in 1936, the Act requires federal
agencies to give “blind persons licensed by a State agency” priority to operate vending carts,
snack bars, and cafeterias on federal property, such as prisons, post offices, and the like.
20 U.S.C. §§ 107(b), 107e. Since 1983, Congress has required the States to prefer blind vendors
for contracts to stock vending machines at rest stops along the Nation’s interstate highways as a
condition of receiving certain federal transportation funds. See Highway Improvement Act of
1982, § 111, Pub. L. No. 97-424, 96 Stat. 2097, 2106 (1983) (codified as amended at 23 U.S.C.
§ 111(c)).
No. 19-2179 Armstrong v. Mich. Bureau of Servs. for Blind Persons Page 3
In implementing this federal-state program, Michigan licenses vendors and connects
them with available contracts, supplementing these federal set-asides with its own preferences
for blind citizens under state law. See Mich. Comp. Laws § 393.359. The U.S. Department of
Education plays a supporting role, issuing regulations that federal agencies and participating
States must follow and overseeing arbitrations to resolve any disputes. See generally Tenn.
Dep’t of Hum. Servs. v. U.S. Dep’t of Educ., 979 F.2d 1162, 1163–65 (6th Cir. 1992).
In 2010, the Business Enterprise Program denied Armstrong’s bid for a contract to stock
vending machines at rest stops along Interstate 75 near Grayling, a town in Northern Michigan,
more precisely in the northern part of the lower peninsula of Michigan. Armstrong claims that
she lost the bid because officials miscalculated her “operator points,” a comparison data point for
competing bidders. R. 1 at 4–5. She filed a grievance with the Michigan agency that oversaw
the bidding. A state administrative law judge ruled in Armstrong’s favor in 2011 and
recommended that she get “priority for the next available facility/location.” R. 1-2 at 19–20.
The State adopted the ALJ’s recommendation and awarded Armstrong an available vending
route later that year.
Armstrong nonetheless requested federal arbitration. See 20 U.S.C. §§ 107d-1(a), 107d-
2. She asked to “be made whole” by immediately obtaining the vending contract she “rightfully
should have” received and for nearly $250,000 in damages to account for delays in getting the
license. R. 24-1 at 11–12. After a hearing on September 30, 2015, the arbitrators ruled that
Armstrong “was wrongfully denied the [vending] location she sought,” R. 1-4 at 9–10, and
agreed that “the only way to make [her] whole is to grant [her] specific relief,” id. at 10. They
ordered Michigan to “immediately” assign Armstrong the Grayling vending route. Id. The
arbitrators declined to award damages, reasoning that her request lacked sufficient evidence and
was “too speculative.” Id.
The decision did not satisfy anyone. Both sides sued in federal district court, challenging
different parts of the arbitrators’ decision. See 20 U.S.C. § 107d-2(a); see also 5 U.S.C.
§ 706(2). Armstrong asked the court to set aside the denial of her damages claim; Michigan
objected to the order to award her the disputed contract. Armstrong also sued three Michigan
officials, individually and in their official capacities, under 42 U.S.C. § 1983. She asked the
No. 19-2179 Armstrong v. Mich. Bureau of Servs. for Blind Persons Page 4
district court for an injunction enforcing the portion of the decision in her favor and for damages
to account for lost profits due to the State’s noncompliance with the arbitrators’ order.
The district court upheld the arbitration award in full. And it rejected Armstrong’s
§ 1983 claims, concluding that the Randolph-Sheppard Act created the sole statutory right to
relief under federal law. After the court issued its decision, Michigan granted her the Grayling
license. All that remains in the case is Armstrong’s request for money damages under the
Randolph-Sheppard Act and § 1983. We address each in turn.
II.
When a plaintiff asks a State for money damages premised on an alleged violation of a
federal statute, questions about sovereign immunity often follow. There’s the question of power:
Has Congress invoked a permissible basis for abrogating the State’s immunity from suit?
Sossamon v. Texas, 563 U.S. 277, 281, 284 (2011). And there’s the question of clarity: Even if
Congress has the requisite authority, say under its spending power, did the legislature
“unequivocal[ly] express[]” its intent to expose States to liability? Pennhurst State Sch. & Hosp.
v. Halderman, 465 U.S. 89, 99 (1984).
Both questions linger in this case. But we need not resolve them today. When a State
“declines to raise sovereign immunity as a threshold defense,” we have the “discretion to address
the sovereign-immunity defense and the merits in whichever order [we] prefer.” Nair v. Oakland
Cnty. Cmty. Mental Health Auth., 443 F.3d 469, 477 (6th Cir. 2006). Whether in the district
court or here, the State has not shown any preference for resolving the immunity-related
questions at the outset. We therefore rely on more straightforward grounds for resolving this
appeal.
III.
Federal courts review the outcome of an arbitration under the Randolph-Sheppard Act the
same as they would a “final agency action” under the APA. 20 U.S.C. § 107d-2(a). That means
we may “set aside” a panel’s decision when it is “arbitrary, capricious, an abuse of discretion, or
otherwise not in accordance with [the] law.” 5 U.S.C. § 706(2)(A). Judicial review of an agency
No. 19-2179 Armstrong v. Mich. Bureau of Servs. for Blind Persons Page 5
action, we have emphasized, “is not an invitation for judicial second-guessing.” Ky. Coal Ass’n
v. Tenn. Valley Auth., 804 F.3d 799, 801 (6th Cir. 2015). So long as we can “reasonably”
“discern[]” from the decision-making process why the arbitrators did what they did, and so long
as they considered all the relevant evidence and “articulate[d] a satisfactory explanation” for
their decision, we will not set aside the decision. FCC v. Fox Television Stations, Inc., 556 U.S.
502, 513–14 (2009) (quotations omitted).
The arbitration decision satisfies this standard. In rejecting her request for nearly
$250,000 in damages, the arbitrators reasoned that this amount was “too speculative,” as her
unrealized earnings “cannot be determined with any accuracy, given the number of variables
involved.” R. 19-3 at 73. In particular, the panel noted that she had operated “another facility
during the intervening years,” and the record did not disclose the difference between what she
made in that facility and what she would have made in the Grayling facility. Id. This
explanation confirms that the arbitrators did not “entirely fail[] to consider an important aspect of
the problem, offer[] an explanation for [their] decision that r[a]n counter to the evidence before
[them],” or arrive at a conclusion “so implausible” that a difference of opinion cannot explain it.
Motor Vehicle Mfrs. Ass’n of U.S. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983).
Armstrong complains that the decision not to award damages contradicts the arbitrators’
finding that “no other location is comparable” to the Grayling vending route. R. 19-3 at 73.
“How could [the panel] make th[is] finding[],” she asks, “without having the ability to identify
lost income?” Appellant Br. 28. But it’s reasonable to acknowledge that one enterprise may be
more profitable than another without being able to say by how much. This decision does not
“run[] counter to the evidence.” State Farm, 463 U.S. at 43.
Armstrong insists that the arbitrators failed to appreciate that “[d]amages are not rendered
uncertain because they cannot be calculated with absolute exactness.” Eastman Kodak Co. v. S.
Photo Materials Co., 273 U.S. 359, 379 (1927) (quotation omitted). That may be true. But in
her opening brief on appeal, she did not point to reliable evidence in the record about what she
would have made in the other facility. All she cites is a two-page account of her dispute with the
State that includes one sentence about what the other operator, name unknown, made at some
point at the Grayling facility. No account is given of how she got the information or what year it
No. 19-2179 Armstrong v. Mich. Bureau of Servs. for Blind Persons Page 6
covers. The arbitrators’ conclusion that Armstrong’s claim should be denied because “what she
would have earned as operator of [the Grayling vending route] cannot be determined with any
accuracy, given the number of variables involved” is not arbitrary on this record. R. 19-3 at 73.
In her reply brief, she says that the arbitrators erred in denying her a chance to introduce
evidence of damages. That is too little too late. At any rate, she had plenty of opportunities to
introduce evidence of damages, and even on appeal she still does not point to reliable evidence
of earnings from the other facility. The decision was not arbitrary or for that matter capricious.
IV.
That leaves Armstrong’s claim under § 1983, which runs into a different merits problem.
The statute does not authorize her to obtain damages that the Randolph-Sheppard Act itself does
not authorize or that she failed to obtain under it.
Since Maine v. Thiboutot, 448 U.S. 1 (1980), the Supreme Court has allowed plaintiffs to
invoke § 1983’s right of action in some discrete settings. But § 1983 “does not provide an
avenue for relief every time a state actor violates a federal law.” City of Rancho Palos Verdes v.
Abrams, 544 U.S. 113, 119 (2005). To enforce another federal statute under § 1983, a claimant
must do two things. First, she must show that Congress “unambiguously” granted her an
individually enforceable “right” under the separate federal statute. Gonzaga Univ. v. Doe, 536
U.S. 273, 283–84 (2002). Vague references to “benefits” or “interests” do not suffice. Id. at
283. Second, she must show that Congress’s creation of a right of action in the underlying
statute does not occupy the field. “The provision of an express, private means of redress in the
statute itself,” the Supreme Court has explained, “is ordinarily an indication that Congress did
not intend to leave open a more expansive remedy under § 1983.” Rancho Palos Verdes, 544
U.S. at 121; see also Mich. Corr. Org. v. Mich. Dep’t of Corr., 774 F.3d 895, 904 (6th Cir.
2014).
We need not resolve whether the Randolph-Sheppard Act creates the kind of rights that
§ 1983 may enforce. The salient problem with this request is that the Act creates precisely the
sort of “comprehensive enforcement scheme” that an individual remedy under § 1983 would
frustrate. See Blessing v. Freestone, 520 U.S. 329, 341 (1997).
No. 19-2179 Armstrong v. Mich. Bureau of Servs. for Blind Persons Page 7
The Act requires vendors and States to resolve their disputes through a carefully designed
set of procedures that give state officials—not federal authorities, much less the federal courts—
the first shot at resolution. Under the Act, vendors initially must seek relief through a state
administrative process. See 20 U.S.C. §§ 107d-1(a), 107d-2; Fillinger v. Cleveland Soc’y for the
Blind, 587 F.2d 336, 337–38 (6th Cir. 1978). After that, they may seek federal arbitration. Only
after that may they seek relief in federal court. Even then, the Act confines judicial review to the
narrow grounds permitted under § 706 of the APA. See 20 U.S.C. § 107d-2(a). It’s “hard to
believe that Congress intended to preserve the § 1983 right of action when it created so many
specific statutory remedies” that minimize, rather than exalt, the federal judiciary’s role.
Middlesex Cnty. Sewerage Auth. v. Nat’l Sea Clammers Ass’n, 453 U.S. 1, 20 (1981); see also
Smith v. Robinson, 468 U.S. 992, 1010–12 (1984).
Armstrong objects that, in the absence of “an alternative judicial enforcement
mechanism” under the Randolph-Sheppard Act, she may invoke § 1983. Appellant Br. 19–21.
But the Act does contain a federal judicial enforcement mechanism. It just comes at the end, not
the beginning, of the dispute. The Supreme Court has never held that there must be an
alternative private right of action at the outset of the dispute to preclude recognizing a § 1983
action as a way to enforce the law. Much to the contrary, City of Rancho Palos Verdes v.
Abrams tells us to look at judicial and administrative remedies as part of the assessment of a
statute’s remedial scheme in determining whether Congress meant to allow relief under § 1983
as well. 544 U.S. at 121–22; see, e.g., Blessing, 520 U.S. at 348 (observing that “Title IV-D
contains no private remedy—either judicial or administrative”); Wilder v. Va. Hosp. Ass’n, 496
U.S. 498, 521–22 (1990) (similar for Medicaid Act). “[T]he express provision of one method of
enforcing a substantive rule suggests that Congress intended to preclude others.” City of Rancho
Palos Verdes, 544 U.S. at 121 (quotation omitted).
Smith v. Robinson, 468 U.S. 992 (1984), undermines rather than advances Armstrong’s
claim. It concluded that the Education of the Handicapped Act, which guarantees an adequate
education to disabled children, prevents parents from pressing constitutional claims under § 1983
for the same conduct. Id. at 1010–12. The Court emphasized that a § 1983 lawsuit would allow
plaintiffs to “circumvent the [statute’s] administrative remedies.” Id. at 1012. While the statute
No. 19-2179 Armstrong v. Mich. Bureau of Servs. for Blind Persons Page 8
permits parents to “bring a civil action” against local officials in some settings, see, e.g., 20
U.S.C. § 1415(i)(2), the remedial scheme features state and local administrative hearings as the
leading fora for resolving disputes. Smith, 468 U.S. at 1011–12. So too with the Randolph-
Sheppard Act. In both cases, Congress decided that disputes should be “worked out through a
process that begins on the local level and includes ongoing [consultation], detailed procedural
safeguards, and a right to judicial review” in the end. Id. at 1011.
Fitzgerald v. Barnstable Sch. Comm., 555 U.S. 246 (2009), and Boler v. Earley, 865 F.3d
391 (6th Cir. 2017), do not help Armstrong either. They merely recognized § 1983 lawsuits to
enforce constitutional rights. But there’s nothing wrong with “divergent coverage” between
statutory and constitutional protections. Fitzgerald, 555 U.S. at 258. That happens all the time,
and it simply does not implicate the problem presented here: deploying § 1983 to marginalize, if
not overrun, the enforcement mechanisms already provided in considerable detail in another
federal statute. If Armstrong thinks vendors should have more remedies from States than they
already have under the Randolph-Sheppard Act, the proper approach is to obtain an amendment
to the Act, not to make it irrelevant by using § 1983 instead.
We affirm.