the plaintiff in Hunt v. Washington Apple had standing where no monetary damages were sought and thus no individualized proof was required. 432 U.S. at 344; accord Telecommunications Research & Action Center v. Allnet Communication Services, Inc. (TRAC), 257 U.S. App. D.C. 1, 806 F.2d 1093 (D.C. Cir. 1986). That principle is applicable here. Plaintiffs have not rebutted the defendants' argument that individual participation is required because monetary relief is sought, and the amount that each vendor is entitled to recover is different. The plaintiff organizations do not have standing to represent their members in their claims for monetary relief. However, the plaintiff organizations have standing to challenge the defendant's conduct where the remedy sought is not monetary in nature. See Randolph-Sheppard Vendors of America v. Weinberger, 254 U.S. App. D.C. 45, 795 F.2d 90, 99-100 (granting standing to organizational plaintiffs to protect the rights of their members).
2. Exhaustion of administrative remedies
Defendants argue that resort to arbitration is mandatory under the Randolph-Sheppard Act. In Randolph-Sheppard Vendors of America v. Weinberger, 254 U.S. App. D.C. 45, 795 F.2d 90, 100-111, (D.C. Cir. 1986), the D.C. Circuit concluded, after a lengthy analysis, that vendors were required to exhaust their administrative remedies under the Act. Plaintiffs argue that they are exempt from the exhaustion requirement because resort to the administrative process would be futile. Plaintiffs rely on a recent District of Columbia Superior Court decision, Shank v. Williams, No. 1164-85 (July 16, 1987) (Wagner, J.). In Shank, the Superior Court held that the plaintiff, a blind vendor, was not required to first seek relief by the statutory procedures because the District of Columbia did not provide an adequate forum for an evidentiary hearing.
The Randolph-Sheppard Act provides that SLA's shall provide dissatisfied vendors with "an opportunity for fair hearing." 20 U.S.C. § 107b(6). Grievances not resolved at the hearing are to be submitted to an arbitration panel convened by the Secretary of Education. Id. § 107d-1(a). Hearing procedures of D.C. agencies must be formulated in accordance with the D.C. Administrative Procedures Act. See D.C. Code § 1-1501 et seq. The D.C. APA requires notice-and-comment rulemaking, except in emergencies. Id. § 1-1506. Emergency procedures for evidentiary hearings were published by DCRSA in the D.C. Register on March 24, 1982; the force and effect of the procedures expired 120 days later, on July 22, 1982, in accordance with the D.C. APA. Shank v. Williams, slip op. at 8. The District of Columbia has yet to promulgate hearing procedures in accordance with the D.C. APA.
Defendants argue that evidentiary hearings are available pursuant to the Randolph-Sheppard Act under the auspices of the D.C. Office of Fair Hearings. However, Judge Wagner explicitly rejected this same argument in Shank on the ground that the decision to use the Fair Hearings Office was itself a rulemaking decision requiring notice.
Id. at 9-10. Judge Wagner reasoned that "absent compliance with the notice and publication requirements, no administrative procedure for an evidentiary hearing existed which had any legal effect." Id. at 10 (citing D.C. Code § 1-1538(b)). Judge Wagner had good reason to hold that a hearing before the Fair Hearing Office would not be legally binding: prior to suing in Superior Court, the plaintiff in Shank had an evidentiary hearing before the Fair Hearing Office, received a favorable decision, and was subsequently "informed by the Chief of the Fair Hearings and Regulations Division that the decision was not binding and enforceable because of a lack of jurisdiction." Id.
Defendants argue that Randolph-Sheppard Vendors, not Shank, is the controlling precedent here because the Court must interpret a federal statute. Randolph-Sheppard is clearly authoritative for the proposition that the Randolph-Sheppard Act requires exhaustion. But the court in Randolph-Sheppard did not foreclose the possibility that the administrative procedure might be futile. The analysis of Judge Wagner was not considered by the D.C. Circuit.
In fact, that opinion left the door open for the issue presented here. In Randolph-Sheppard Vendors, the court noted that the futility exception applies when "the agency charged with arbitration has indicated that it does not have jurisdiction over the dispute". 795 F.2d at 105-106, 104 n.21. The Office of Fair Hearing has, at least on one occasion, indicated that it does not have jurisdiction to conduct a hearing. Even more importantly, the Department of Education has made clear that it will not entertain arbitration requests from vendors in the District of Columbia in light of the absence of a procedure for fair hearings. A letter from Acting Commissioner Frank Corrigan explains:
"the District of Columbia Superior Court decision correctly concludes that Federal arbitration is not available to the vendors under the unique circumstances presented in the District. The Department has no choice but to . . . decline to entertain direct arbitration requests from District vendors until local hearing procedures have been promulgated."
Exhibit J, Humphrey Affidavit, Letter to Humphrey from Corrigan, dated Jan. 19, 1988. By comparison, in Randolph-Sheppard Vendors the D.C. Circuit noted that "the Secretary of Education did not disclaim jurisdiction over the controversy." 795 F.2d at 107. The Court finds this to be a compelling case for invoking the futility exception to the exhaustion doctrine because resort to administrative remedies would be useless.
3. Availability of a remedy for monetary damages under Randolph-Sheppard
Defendants contend that the Randolph-Sheppard Act does not create a private right of action for money damages. Plaintiffs argue that retroactive money damages are proper because of the contractual nature of the arrangements that the statute creates. The statute allows SLA's to participate in the program after they promise to adhere to the requirements of the Act. See 20 U.S.C. § 107b. In return, the federal government allows the SLA to establish vending facilities on federal property. The SLA, in turn, licenses blind vendors and signs contracts that set out the responsibilities of both the vendor and the SLA. See Exhibit K, Humphrey Affidavit (sample DCRSA contract). The contracts between the blind vendors and DCRSA contain most of the terms that plaintiffs allege DCSLRA has violated. Plaintiffs argue that this contract between the vendors and the District establishes a basis for money damages.
A Third Circuit case strongly supports plaintiffs' position. In Delaware Department of Health and Social Services v. Department of Education, 772 F.2d 1123 (3d Cir. 1985), the court held that an arbitration panel's award of money damages in favor of a blind vendor against Delaware was binding. The Third Circuit's analysis was grounded on the following logic: the Randolph-Sheppard Act requires states to submit to arbitration; awards of monetary damages in arbitration are commonplace, a fact Congress was well aware of; therefore, arbitrators are authorized to award compensatory damages against states. Id. at 1136-37. The court also concluded that "the relationship between the blind vendor and the state, like conventional employment relationships, is essentially contractual." Id. at 1136. Defendants reply that Delaware Department of Health was wrongly decided. They contend that nowhere in the contracts between the District of Columbia and the federal government and between the District of Columbia and the blind vendors is there any explicit reference to monetary remedies.
The Court concurs with the analysis in Delaware Department of Health : plaintiffs' claims are grounded in their contractual relationship with the defendants or their status as beneficiaries of contracts between the defendants and the United States. Since the Act is intended to benefit vendors, it would be incongruous to hold that the Act limits the contractual remedies otherwise available to blind vendors.
4. Challenge to DCRSA's allocation of funds
Defendants argue that plaintiffs' allegations about expenditure of funds, including the award of contracts, are not proper because agencies have sole discretion to allocate resources as they see fit. See Wisconsin v. FPC, 373 U.S. 294, 313-14, 10 L. Ed. 2d 357, 83 S. Ct. 1266 (1963); Heckler v. Chaney, 470 U.S. 821, 831-32, 84 L. Ed. 2d 714, 105 S. Ct. 1649; National Congress of Hispanic American Citizens v. Marshall, 200 U.S. App. D.C. 18, 626 F.2d 882, 889 (D.C. Cir. 1979). Plaintiffs argue that the principle does not apply because the money being spent is largely the vendors', not the public's. Prior to 1984, nearly all of the funding for DCRSA came from set aside levies imposed on vendors. The vendor levy has accounted for approximately 45% of program income annually since 1984.
This case is not governed by the principle enunciated in Wisconsin v. FPC. Nearly all of plaintiffs' allegations with regard to the allocation of funds are not that DCRSA should reallocate resources, but that DCRSA should repay monies taken from plaintiffs and cease paying monies to contractors and others in violation of the statute. The balance of plaintiffs claims regarding the allocation of resources are principally that DCRSA cannot account for resources passing through it, despite the Act's mandate that it do so. See 20 U.S.C. § 107b-1(1). Moreover, the Randolph-Sheppard Act specifically provides that plaintiff CBV is to participate "in major administrative decisions and policy and program development." Id. § 107b-1(3). This strongly suggests that plaintiffs can challenge both their exclusion from the policymaking process and the policies that were formulated in their absence.
5. Statute of Limitations
The Randolph-Sheppard Act does not include a statute of limitations. In the District of Columbia, there is a three-year statute of limitations for actions not otherwise prescribed D.C. Code § 12-301. Defendants argue that this three-year statute applies, barring all claims based on actions that occurred prior to January 21, 1985, three years prior to the filing of this claim. Plaintiffs contend that the remedies in the Randolph-Sheppard Act are not limited by the local statute of limitations because to do so would be inconsistent with the underlying policy of the statute. See Marshall v. Intermountain Elec. Co., 614 F.2d 260 (8th Cir. 1980); Occidental Life Ins. v. EEOC, 432 U.S. 355, 53 L. Ed. 2d 402, 97 S. Ct. 2447 (1977). Defendants reply that applying the statute of limitations would not defeat the purpose of the Act, and point to one Randolph-Sheppard Act case in which a state statute of limitations was applied. See Almond v. Boyles, 612 F. Supp. 223, 228 (D.N.C. 1985) (applying state statute of limitations and "continuing wrong" doctrine), aff'd in relevant part, 792 F.2d 451, 456 (4th Cir. 1986), cert. denied, 479 U.S. 1091, 107 S. Ct. 1302, 94 L. Ed. 2d 157 (1987). In light of arguments made at the hearing on this motion regarding estoppel, the Court declines to rule on this aspect of defendant's motion until further briefing has been completed in accordance with the Court's order of September 28, 1988.
B. Motion for Class Action
Plaintiffs seek certification as a class to maintain this action. The proposed class consists of all blind vendors licensed to operate in the District of Columbia. Plaintiffs claim that they meet the requirements of Rule 23(a): numerosity, typicality, common questions, and adequate representation. The Court holds that these four requirements are satisfied.
Rule 23(a) requires that a class be "so numerous that joinder of all members is impracticable." Fed. R. Civ. P. 23(a)(1). There are presently 63 blind vendors licensed to operate vending facilities in the District of Columbia. This same number of class members was found to satisfy the numerosity requirement in Bachman v. Collier, 73 F.R.D. 300, 304 (D.D.C. 1976). Another factor in determining if joinder is practical is whether members of the class would be able to pursue remedies on an individual basis. The relatively meager financial resources of the individual vendors countenances against requiring individual actions. The Court concludes that joinder is not a satisfactory alternative in this instance, and holds that plaintiffs have satisfied the numerosity requirement. Rule 23(a) also requires that there be "questions of law or fact common to the class." Fed. R. Civ. P. 23(a)(2). This case raises numerous questions of law and fact common to the class, and the Court holds that Rule 23(a)(2) has been satisfied.
The typicality prong of Rule 23(a) requires that "the claims or defenses of the representative parties" be "typical of the claims or defenses of the class." Fed. R. Civ. P. 23(a)(3). The claims of the representatives must "resemble or exhibit the essential characteristics of those of the representatives." Kas v. Financial General Bankshares, Inc., 105 F.R.D. 453, 461 (D.D.C. 1984). The Court holds that the typicality requirement has been met. Plaintiffs assert claims based on statutory or contractual violations that are equally applicable to members of the proposed class.
Finally, Rule 23(a) requires that "the representative parties will fairly and adequately protect the interests of the class." Fed. R. Civ. P. 23(a)(4). The Court must find that the representative has no conflict of interest with the class members, and that the representative is able "to vigorously prosecute the interests of the class through qualified counsel." National Ass'n of Regional Medical Programs v. Mathews, 179 U.S. App. D.C. 154, 551 F.2d 340, 345 (D.C. Cir. 1976), cert. denied, 431 U.S. 954, 53 L. Ed. 2d 270, 97 S. Ct. 2674 (1977). The individual representatives are the elected leaders of the business associations to which all or most of the proposed class belong. They contend that they have informally contacted many members of the class and have their authority to bring this action. Under these circumstances, individual plaintiffs are clearly adequate representatives. See Wright, Miller & Kane, Federal Practice and Procedure § 1765. Plaintiffs' counsel appears to be qualified, and has not been challenged by defendants.
A class action is maintainable under Rule 23(b)(3) when "questions of law or fact common to the members of the class predominate over any questions affecting only individual members, and  a class action is superior to other available methods." Fed. R. Civ. P. 23(b)(3). The Rule sets out four pertinent factors to consider when making the above determination:
(A) the interest of members of the class in individually controlling the prosecution or defense of separate actions;