Sauer v. U.S. Department of Education

Under the Randolph-Sheppard Act, a state licensing agency has no duty to bring an enforcement action against a federal agency to enforce an arbitration award issued pursuant to 20 U.S.C. § 107d-1(b).

California Department of Rehabilitation (“DOR”) and the United States Department of Education (“DOE”) appeal from the district court’s decision enforcing a 2008 arbitration award issued pursuant to 20 U.S.C. § 107d-1(a) of the Randolph-Sheppard Vending Stand Act (“the Act”). Under the Act, state agencies license blind persons to operate vending facilities on federal properties. Section 107d-1(b) of the Act provides that where a state licensing agency finds that federal control of a property fails to comply with the Act, the agency “may file a complaint with the he Secretary of Education who shall convene a panel to arbitrate the dispute.” The issue before the Ninth Circuit was whether the Act requires a state licensing agency to sue a noncomplying federal agency. The court reviewed de novo, found that it did not, and reversed. The Ninth Circuit examined the plain language of the Act and found, (1) no provision in the Act mentioned judicial enforcement of arbitration awards; (2) that the use of “may” and “shall” in the same provision made it clear the agency had discretion, not the obligation, to pursue arbitration; and (3), though such presumptive discretion “may be rebutted where a substantive statute has provided guidelines for the agency to follow in exercising its enforcement powers … the Act [did] not expressly give state licensing agencies the right, let alone the duty, to bring an action to enforce an arbitration award.” Thus, the Ninth Circuit concluded that the plain language of the statute weighed against interpreting the Act as imposing a duty on state licensing agencies to sue noncompliant federal agencies, and that interpretation otherwise “would be at odds with the Act’s emphasis on cooperation between the states and the federal government.” REVERSED.