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Teton Historic Aviation Foundation v. United States

United States District Court, District of Columbia

January 18, 2013

UNITED STATES of America, et al., Defendants.

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Kevin R. Garden, The Garden Law Firm P.C., Alexandria, VA, for Plaintiffs.

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Oliver W. McDaniel, U.S. Attorney's Office, Washington, DC, for Defendants.


ROBERT L. WILKINS, District Judge.

Plaintiffs Teton Historic Aviation Foundation and Teton Avjet, LLC, d/b/a " Teton Aviation Center," (collectively, " Teton" ) bring this case against Defendants United States of America and the United States Department of Defense (collectively, the " Government" ) under the Administrative Procedure Act (" APA" ), 5 U.S.C. ยง 701 et seq., claiming that the Government's actions improperly prevented Teton from acquiring a number of surplus aircraft parts under its auction contract with Government Liquidation, LLC— a private, non-governmental entity that is not a party to this action. After submitting the winning bid in that auction, Teton submitted the list of parts it sought to harvest from the five source aircraft included in the auction, and, pursuant to the terms of the contract, Teton's requested parts list was forwarded to the Defense Reutilization and Marketing Service (" DRMS" )— a Department of Defense component— for final review and approval.[1] Following DRMS's review, many of the parts Teton sought to purchase were deemed unsaleable and ineligible for release because of the Government's assignment of certain demilitarization codes to those parts. Through this lawsuit, Teton principally challenges the Government's review and classification of those aircraft parts as arbitrary and capricious, along with a couple of secondary APA challenges.

The parties cross-moved for summary judgment, and on December 21, 2012, the Court notified the parties that it would hold a hearing on those motions. The Court advised that, in addition to the issues presented in their briefs, the parties should be prepared to discuss whether Teton possesses Article III standing to pursue its APA claims against the Government and, specifically, whether a decision from this Court would redress Teton's injury. The Court heard argument from the parties during a lengthy hearing on January 15, 2013. Ultimately, upon consideration of the administrative record in this case, the parties' briefing, and the arguments of counsel, the Court concludes, for the reasons set forth herein, that Teton lacks Article III standing to pursue its claims and will DISMISS this action for want of jurisdiction. In turn, both Plaintiffs' Motion for Summary Judgment, (Dkt. No. 61), and Defendants' Cross-Motion for Summary Judgment, (Dkt. No. 69), will be DENIED AS MOOT.


The relevant history of this case begins with an auction. In August 2008, Government Liquidation, LLC (" GL" )— a private, third-party entity with whom the Department of Defense contracts to assist in the sale and disposal of surplus property— posted a bid announcement for the sale of aircraft parts from five " A-4" aircraft bearing tail numbers 154306, 154623, 154337, 153483, and 152863. (Administrative Record (" AR" ) at 213-215). Among other details, the announcement explained that:

[N]on-hazardous Demil A, B, and Q components in this offer, that may be available include, but are not limited to: instrumentation, communication and navigational equipment, hydraulic and pneumatic components, fuel and restroom equipment, cabin and cockpit furnishings, galley equipment, landing

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gears, wheels and tires, and quick engine change components.

( Id. ). The announcement indicated that GL's " special terms and conditions apply to this sale," along with the " general terms and conditions of sale ... which are listed on Government Liquidation[']s web site." ( Id. ). [2] It also stated that " [b]uyers['] participation, by placing a bid in a sales event governed by the special terms, shall serve as their acknowledgment of an agreement to be bound by both the general terms and the special terms." ( Id. ).

The " Special Terms and Conditions of Sale" restated the above description of the aircraft components that might be available through the sale, but it also expressly described components that would not be included:

Not included are airframe, control surfaces and aircraft skin. THE AIRCRAFT CARCASS SHALL REMAIN THE PROPERTY OF DOD SURPLUS, LLC (" DOD Surplus" ). Further excluded from this offer are munitions, weapons, Flight Safety Critical Aircraft Parts (FSCAP) items, Critical Sensitive Items (CSI), matting, modules, engine containers, ties downs, and counter weights. NOTE: Aircraft has been subjected to parts reclamation with some parts missing, damaged or loose.

( Id. at 964-95) (emphasis in original).[3] The " Special Terms" went on to describe the procedure that the component parts sale would follow:

Payment of the high bid is due within 5 business days of the scheduled close of the auction. Along with payment buyer will provide a properly completed End Use Certificate (" EUC" ). With in [sic] ten days of the sale closing the buyer shall submit a listing of parts to be removed. The listing shall contain (at a minimum) NSN, Description, manufacturer, cage code and quantity desired by aircraft tail number. GL shall verify that the parts meet the requirements specified for this sale. If the buyer has not submitted the parts list in ten calendar days after sale closing, the sale shall be cancelled. The list will then be sent to DRMS for verification. Any parts not meeting the requirements shall be deleted from the listing and no adjustment made in sale price. DRMS shall transmit the list to AMARG for removal. AMARG shall remove the parts and provide DRMS the actual removal costs. Buyer shall be informed or removal costs by DRMS. Buyer is responsible for paying DRMS directly for parts removal costs. Parts will be released to buyer only after EUC approval and DRMS confirms to GL receipt of removal payment in full.
Id. [4]

Teton participated in the auction, submitting a sealed bid of $8,250.00. As it turns out, Teton was the winning bidder and secured the ability to acquire available parts from the five source aircraft. ( Id. at 518-519). Teton deposited $50,000.00 to bind the sale, ( id. at 500-502, 857-58), and

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on or around August 28, 2008, it submitted a list of the specific parts requested from each aircraft, ( id. at 307-354). Upon receipt, GL conducted a preliminary review of Teton's requested parts list and forwarded that list on to DRMS for final approval, pursuant to the terms of the sale. ( Id. at 441-466). DRMS reviewed Teton's parts list and assigned demilitarization (" Demil" ) ...

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