The opinion of the court was delivered by: JAMES KNOLL GARDNER, District Judge
This matter is before the court on Defendants' Motion to Dismiss
Amended Complaint and Supporting Memorandum of Law filed August 27,
2003.*fn1 Defendants seeks to dismiss plaintiff's Complaint because they
contend that the claims presented are mooted by two Settlement
Agreements*fn2 entered into by the parties. In the alternative,
defendants claim that this court lacks jurisdiction over the matter, and
that plaintiff's claims may only be raised before the United States Court
of Federal Claims. Finally, defendants argue that Count IV of plaintiff's
Complaint fails to state a claim upon which relief may be granted.
Because we conclude that plaintiff's attempt to invalidate the
settlement contract between the parties must be resolved before the
merits of Counts I through III of plaintiff's Complaint may be addressed,
and because
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jurisdiction over the settlement contracts lies with the United
States Court of Federal Claims, we transfer plaintiff's claims concerning
the settlement agreements to the Court of Federal Claims. We further
conclude that Count IV of plaintiff's Complaint raises a nonjusticiable
issue, and, therefore, fails to state a claim upon which relief may be
granted. Accordingly, we dismiss Count IV. Finally, because the Court of
Federal Claims must resolve issues pertaining to the validity of the
Settlement Agreements before we may address Counts I through III, we
place the remainder of this action in civil suspense pending further
Order of the undersigned. After the Court of Federal Claims has resolved
the issue of the validity of the Settlement Agreements, the undersigned
will reactivate this case from civil suspense.
Plaintiff Capital Bonding Corporation ("Capital") commenced this civil
action on March 21, 2003 by filing a five-count Complaint against
defendant Department of Homeland Security ("DHS") and defendant Robert P.
Wiemann, Director of the Administrative Appeals Office of the Immigration
and Naturalization Service ("INS"). This initial Complaint averred breach
of contract, breach of the duties of good faith and fair dealing,
promissory estoppel, unjust enrichment, and
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fraud in the inducement. On May 27, 2003 defendants*fn3 responded
to plaintiff's initial Complaint by filing a motion to dismiss.
On June 9, 2003 Plaintiff filed an Amended Complaint. In the Amended
Complaint, plaintiff added defendants Asa Hutchinson, Under Secretary for
Border and Transportation Security in Department of Homeland Security,
and Robert Bevilacqua, Director of Debt Management of the INS.
The Amended Complaint contains four counts. These counts are styled:
(I) Judicial Review of AAO Decisions; (II) Judicial Review of the
Agency's Failure to Acknowledge Validity of Defenses on Bonds Associated
With File Review; (III) Judicial Review Based on the Congressional Review
Act; and (IV) Review of Agency's Failure to Enact Suggested Reforms.
Although it is not listed as a count, plaintiff also seeks a declaratory
judgment that two Settlement Agreements entered by plaintiff and the
government are voidable by plaintiff. Plaintiff contends that federal
question jurisdiction is conferred on the court by the following
statutes: 5 U.S.C. § 701-706; 28 U.S.C. § 1331; and
28 U.S.C. § 2201-2202.
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Defendants filed the within motion to dismiss plaintiff's Amended
Complaint on August 27, 2003.
Based upon the allegations in plaintiff's Amended Complaint, the
following are the pertinent facts.*fn4 Capital and its agents, on behalf
of sureties Frontier Insurance Company, Connecticut Indemnity Company,
Highland Insurance Company, Aegis Security Insurance Company, and HARCO
National Insurance Company, posted many immigration bonds with DHS.*fn5
Capital and the surety companies were co-obligors on these immigration
bonds.*fn6 Capital was and is responsible for performing the duties set
forth in the bonds.*fn7
Over 98% of the bonds are "delivery" bonds under which DHS has a right
to demand an alien's surrender at a specified location, at a specified
time.*fn8 If Capital fails to
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produce an alien as required, the bond is considered to be
breached.*fn9
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If the government sends a notice of breach to Capital, then Capital has
30 days in which to file an administrative appeal with the Administrative
Appeals Office (AAO).*fn10 In an appeal to the AAO, Capital may assert a
number of defenses.*fn11 If a defense is determined to be valid, then
the bond may be cancelled or the breach rescinded.*fn12
In the event that Capital fails to appeal, the defenses are rejected by
the AAO, or the AAO dismisses the appeal, then DHS sends notice of the
breach to the office of Debt Management and Collection, which then sends
an invoice to Capital.*fn13
Capital claims that there have been numerous occasions when the AAO has
rejected a valid defense. In 2001 Capital had a number of these unpaid
invoices on breached
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immigration bonds.*fn14 Because Capital believed that it had a
number of meritorious defenses to many of these invoices, Capital in
November 2001 requested DHS to conduct a review of a sampling of the
breached invoices.*fn15
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In August 2002 Capital and DHS*fn16 entered into a settlement
Agreement ("2002 Agreement") whereby Capital was to pay DHS an initial
payment of $3,000,000 in six semi-monthly payments of $500,000.*fn17
Under the 2002 Agreement, Capital was to make additional payments of
$500,000 monthly until any additional amount due was satisfied.*fn18
Finally, Capital and DHS agreed to conduct a joint review of a sample ...