in the Westside Bypass project. This proposition was disputed by Plaintiffs and by amicus curiae, the Public Interest Law Center of New Jersey ("PILC").
In a cursory response to Defendants' motions to dismiss, Plaintiffs argued that the Simpson Doctrine had been abrogated by the passage of the Civil Rights Restoration Act of 1986 ("CRRA"), 42 U.S.C. § 2000d-4a. See Plaintiffs' Brief at 21-22. PILC amplified this argument with a more substantial analysis. See PILC's Brief at 27-33. Plaintiffs also stated, in what I presume to be an alternative argument, that they had standing under the Simpson Doctrine because the intended beneficiaries of the Westside Bypass project must include "all citizens of the State of New Jersey and more particularly citizens of Atlantic City." Id. at 21. PILC similarly contended that Plaintiffs were the intended beneficiaries of the Westside Bypass project "as citizens of Atlantic City." See PILC's Brief at 33.
Faced with only these arguments, I determined in Bryant I that the CRRA did not abrogate the Simpson Doctrine. See Bryant I, 987 F. Supp. 343, 1998 U.S. Dist. LEXIS 1847 at *21-25. I also found that Plaintiffs were not intended beneficiaries of, applicants for, or participants in the Westside Bypass project because, "to the extent that potential casino patrons, residents of Atlantic City or residents of New Jersey would benefit from this project ... the logical nexus with the relevant program is too diffuse to provide a basis for standing and thus for subject matter jurisdiction." See Bryant I, 987 F. Supp. 343, 1998 U.S. Dist. LEXIS 1847 at *29. Therefore, I dismissed Plaintiffs' Title VI claim for lack of standing and declined to exercise supplemental jurisdiction over Plaintiffs' state law claim. See id.
On February 25, 1998, however, the Supreme Court decided the case of National Credit Union Association v. First National Bank & Trust Co., 118 S. Ct. 927, 140 L. Ed. 2d 1, 1998 U.S. LEXIS 1448, 1998 WL 75036 (1998). On February 26, 1998, in a telephone conference call with all counsel, I asked the parties to submit supplemental briefs discussing the impact, if any, of the National Credit Union decision on Plaintiffs' standing in this case. On March 12, 1998, in order to eliminate any prejudice to Plaintiffs during my reconsideration of Bryant I, and with the consent of all parties, I entered an order pursuant to Rule 4(a)(5) of the Federal Rules of Appellate Procedure extending Plaintiffs' time for filing a Notice of Appeal from the order of dismissal for 30 days.
In the wake of National Credit Union, I must discern the nature of my authority to reconsider the order of dismissal, I must evaluate the implications of National Credit Union, and I must determine whether, at the end of the day, Plaintiffs have standing to maintain this action under Title VI. I conclude that Rule 59(e) of the Federal Rules of Civil Procedure authorizes me to reconsider my decision in Bryant I, that, in light of National Credit Union, the Simpson Doctrine no longer controls this case, and that Plaintiffs do have standing to assert a claim under Title VI. Accordingly, the order of dismissal will be vacated as to the Title VI claim.
A. Justice, Process and Rule 59(e)
Defendants have expressed considerable doubt as to the existence of a procedural mechanism which would allow me to reconsider the judgment of dismissal entered on February 17, 1998. See, e.g., CRDA's Supp. Brief at 3 n.1. A district court may, however, vacate a judgment pursuant to Rule 59(e) on the basis of an intervening change in controlling law. See North River Insurance Co. v. CIGNA Reinsurance Co., 52 F.3d 1194, 1218 (3d Cir. 1995); see also Hulmes v. Honda Motor Co., Ltd., 960 F. Supp. 844, 850 (D.N.J. 1997), aff'd mem., 141 F.3d 1154 (3d Cir. 1998).
Although such power is infrequently exercised by federal courts, there is no doubt of its existence and courts have not hesitated to vacate orders of dismissal based upon subsequent Supreme Court decisions. See, e.g., Hill v. City of Chester, 1994 U.S. Dist. LEXIS 11951, *1, 1994 WL 463405, *1 & n.1 (E.D. Pa. Aug. 26, 1994), aff'd mem., 60 F.3d 815 (3d Cir.), cert. denied, 116 S. Ct. 302 (1995).
Nevertheless, CRDA contends that Rule 59 cannot provide the mechanism for reconsidering Bryant I because CRDA reads that rule to apply only to a judgment rendered after trial. See CRDA's Supp. Brief at 3 n.1. Although most of Rule 59 does indeed pertain to new trials, the last paragraph expressly permits a district court to "alter or amend a judgment." See Fed. R. Civ. P. 59(e). The term "judgment" as used in the Federal Rules of Civil Procedure includes "a decree and any order from which an appeal lies." Fed. R. Civ. P. 54(a) (defining "Judgment"). Thus, Rule 59(e) permits a district court to reconsider an order of dismissal. See Belair v. Lombardi, 151 F.R.D. 698, 699 (M.D. Fla. 1993) ("A motion to alter or amend a judgment is permissible in cases, as the one now before the Court, which have been resolved through an order of dismissal."); see also American Trial Lawyers Association, New Jersey Branch v. New Jersey Supreme Court, 409 U.S. 467, 34 L. Ed. 2d 651, 93 S. Ct. 627 (1973) (reversing denial of Rule 59(e) motion to amend judgment of dismissal); Welch v. Folsom, 925 F.2d 666 (3d Cir. 1991) (finding that Rule 59(e) motion for reconsideration of order dismissing complaint was timely filed).
A district court may invoke this power sua sponte. See Hertz Corp. v. Alamo Rent-a-Car, Inc., 16 F.3d 1126, 1132 (11th Cir. 1994); Burnam v. Amoco Container Co., 738 F.2d 1230, 1232 (11th Cir. 1984); Sargent v. Columbia Forest Products, Inc., 1994 WL 902817, *2 (D. Vt. Sep. 7, 1994), aff'd mem., 52 F.3d 311 (3d Cir.), cert. denied, 116 S. Ct. 256 (1995); Thomas v. Board of Examiners, Chicago Public Schools, 1986 U.S. Dist. LEXIS 26055, 1986 WL 5662, *1 (N.D. Ill. April 30, 1986); see also Sun-Tek Industries, Inc. v. Kennedy Sky Lites, Inc., 929 F.2d 676, 678 (Fed. Cir. 1991) (district court lacks authority to amend its judgment "in the absence of a motion or sua sponte action within the time limits set by Rule 59(e)"); Charles v. Daley, 799 F.2d 343, 348 (7th Cir. 1986) ("A significant change in a judgment starts all time periods anew, whether the district court alters the judgment at the request of a party or on its own motion.").
At this stage of these proceedings, the reconsideration of my order of dismissal on February 17, 1998, also conserves judicial resources and promotes justice. Even if I were to refrain from applying National Credit Union at this point, the Third Circuit would at least have discretion to consider the implications of that case on appeal, see Salvation Army v. Department of Community Affairs of the State of New Jersey, 919 F.2d 183, 197 (3d Cir. 1990), if it is not compelled to consider it, see Smith v. Holtz, 87 F.3d 108, 111 n.3 (3d Cir.), cert. denied, 117 S. Ct. 611 (1996). "Surely no constructive purpose would appear to be served by this Court's staying with a demonstrably incorrect result, when an appeal from such a decision appears almost certain to compel its reversal based on new and controlling authority." United States v. Ginsburg, 705 F. Supp. 1310, 1326 n.2 (N.D. Ill. 1989), aff'd on other grounds, 909 F.2d 982 (7th Cir. 1990); see also Holtz, 879 F. Supp. 435, 439 (M.D. Pa. 1995) (granting relief from judgment pursuant to Fed. R. Civ. P. 60(b)(6) in part to "avoid the needless delay and expense incurred by all concerned if the movant's sole remedy was appeal to a higher court"), aff'd on other grounds, 87 F.3d 108 (3d Cir.), cert. denied, 117 S. Ct. 611 (1996). Moreover, absent a stay, Plaintiffs' homes could be condemned and destroyed by the time the Third Circuit heard their appeal. Thus, failing to act now would clearly "affect the substantial rights of the parties." See Fed. R. Civ. P. 61.
A motion for reconsideration under Rule 59(e) must come within 10 days of the judgment at issue. See Fed. R. Civ. P. 59(e); accord Local Civ. R. 7.1(g). In this case, I dismissed the Amended Complaint on February 17, 1998. See Bryant I, 987 F. Supp. 343, 1998 U.S. Dist. LEXIS 1847. Thus, the time for reconsidering that decision would not expire until March 3, 1998. See Fed. R. Civ. P. 6(a); Adams v. Trustees of the New Jersey Brewery Employees' Pension Trust Fund, 29 F.3d 863 (3d Cir. 1994). Therefore, because I raised this issue on February 26, 1998, the motion is timely.
Finally, CRDA intimates that I may not reverse my prior decision on the basis of an issue not previously presented to the Court. See CRDA's Supp. Brief at 3 n.1. The Third Circuit has held, however, that on a motion for reconsideration, "where 'a previously ignored legal theory takes on new importance due to an intervening development in the law, it is appropriate ... to exercise ... discretion to allow a party to revive that theory.'" North River Insurance Co. v. CIGNA Reinsurance Co., 52 F.3d 1194, 1218 n.39 (3d Cir. 1995) (quoting Salvation Army, 919 F.2d 183 at 196). I will, therefore, proceed to consider the import of the National Credit Union decision.
B. The Death of a Doctrine
In order to sue in federal court, Plaintiffs must satisfy not only the "case or controversy" standing requirements of Article III of the Constitution, but also the requirements of statutory standing. See Bryant I, 987 F. Supp. 343, 1998 U.S. Dist. LEXIS 1847 at *10-11.
Specifically, courts require "that a plaintiff's grievance must arguably fall within the zone of interests protected or regulated by the statutory provision or constitutional guarantee invoked in the suit." Id. at *11 (quoting Bennett v. Spear, 520 U.S. 154, 137 L. Ed. 2d 281, 117 S. Ct. 1154, 1161 (1997)). The Simpson Doctrine dictates that Title VI's zone of interests includes the intended beneficiaries of, applicants for, and participants in federally funded programs. See Bryant I, 987 F. Supp. 343, 1998 U.S. Dist. LEXIS 1847 at *18.
The holding, language and tenor of National Credit Union, however, compel me to re-examine the Simpson Doctrine. In National Credit Union, the National Credit Union Association had interpreted section 109 of the Federal Credit Union Act ("FCUA"), 12 U.S.C. § 1759, to permit credit unions to consist of multiple, unrelated employer groups each with its own common bond of occupation. Five commercial banks and the American Bankers Association filed suit under the Administrative Procedures Act, 5 U.S.C. § 702, to challenge the agency's interpretation of the FCUA. The Supreme Court held that, as competitors of the credit unions, the banks had standing to challenge the administrative action.
Writing for the majority of five, Justice Thomas delineated the zone of interests test:
for a plaintiff's interests to be arguably within the "zone of interests" to be protected by a statute, there does not have to be an indication of Congressional purpose to benefit the would-be plaintiff. The proper inquiry is simply whether the interest sought to be protected by the complainant is arguably within the zone of interests to be protected ... by the statute. Hence, in applying the "zone of interests" test, we do not ask whether, in enacting the statutory provision at issue, Congress specifically intended to benefit the plaintiff.
National Credit Union, 118 S. Ct. 927, 140 L. Ed. 2d 1, 1998 U.S. LEXIS 1448, *23, 1998 WL 75036 at *8 (quotations and citations omitted) (emphasis altered).
I am unable to reconcile the Simpson Doctrine's emphasis on "intended" beneficiaries with this language; it is therefore clear to me that the Supreme Court's zone of interests test is inconsistent with the Simpson Doctrine's exclusive search for intended beneficiaries, applicants or participants. Moreover, the Supreme Court found that the interests of the commercial banks arguably fell within the zone of interests protected by the statute at issue "even if it cannot be said that Congress had the specific purpose of benefiting commercial banks." 118 S. Ct. 927, 140 L. Ed. 2d 1, 1998 U.S. LEXIS 1448, *25, 1998 WL 75036 at *9. The Simpson Doctrine, however, effectively confers standing only where Congress had such a purpose. See Simpson, 629 F.2d 1226; Bryant I, 987 F. Supp. 343, 1998 U.S. Dist. LEXIS 1847 at *17-18. Thus, I conclude that the law of standing, as articulated by the Supreme Court in National Credit Union, precludes application of the Simpson Doctrine in this case.
Defendants contend that National Credit Union did not change the law of standing, and that the result reached in Bryant I remains correct. In support of this argument, Defendants emphasize Justice Thomas' disagreement with Justice O'Connor's dissent. In response to Justice O'Connor's criticism that he had eviscerated the zone of interests test, see National Credit Union, 118 S. Ct. 927, 140 L. Ed. 2d 1, 1998 U.S. LEXIS 1448, *42, 1998 WL 75036 at *14-25 (O'Connor, J., dissenting), Justice Thomas wrote, in a footnote which I predict will engender considerable debate in the future, that the test he articulated "differs only as a matter of semantics" from the previously existing test. See National Credit Union, 118 S. Ct. 927, 140 L. Ed. 2d 1, 1998 U.S. LEXIS 1448, *26, 1998 WL 75036 at *9 n.7. Thus, Defendants argue, National Credit Union has not changed the state of the law.
The Supreme Court, however, had never ratified the Simpson Doctrine and therefore, by reiterating the Court's old test, Justice Thomas did nothing to preserve that doctrine. See Bryant I, 987 F. Supp. 343, 1998 U.S. Dist. LEXIS 1847 at *17 n.4 (citing North Haven Board of Education v. Bell, 456 U.S. 512, 72 L. Ed. 2d 299, 102 S. Ct. 1912 (1982); Consolidated Rail Corp. v. Darrone, 465 U.S. 624, 104 S. Ct. 1248, 79 L. Ed. 2d 568 (1984)). In fact, Justice Thomas implied that the zone of interests test had always been inconsistent with a test substantially similar to the Simpson Doctrine. In rejecting the argument that the banks lacked standing because there was no evidence that Congress was concerned with commercial banks when it passed the FCUA, Justice Thomas concluded:
To accept that argument, we would have to reformulate the "zone of interests" test to require that Congress have specifically intended to benefit a particular class of plaintiff before a plaintiff from that class could have standing under the APA to sue. We have refused to do this in our prior cases, and we refuse to do so today.