Background
The Fairfax County and Arlington school boards maintain policies allowing transgender and gender-expansive students to use bathrooms, locker rooms, and certain overnight accommodations consistent with their gender identity. After investigating those policies, the U.S. Department of Education’s Office for Civil Rights concluded that the districts were violating Title IX and proposed resolution agreements requiring them to change their policies.
When the districts declined, the Department began administrative proceedings that could suspend or terminate federal assistance, designated the districts as high-risk grant recipients, and required them to pay eligible expenses with nonfederal money before seeking reimbursement. The districts brought Administrative Procedure Act claims challenging the Title IX findings and high-risk designations and seeking declaratory and injunctive relief. The district court dismissed the complaints sua sponte, reasoning that they were essentially contractual funding disputes within the exclusive jurisdiction of the Court of Federal Claims under the Tucker Act.
The Court’s Holding
In a 2-1 decision, the Fourth Circuit vacated the dismissal and remanded. The majority held that the Tucker Act did not deprive the district court of jurisdiction over every claim in the complaints. The districts asserted at least some statutory, rather than contractual, claims: they challenged the Department’s interpretation and enforcement of Title IX, sought to set aside their high-risk designations, and requested an injunction against further enforcement based on the alleged Title IX violations.
The court distinguished cases involving terminated grants and demands that the government continue making payments under grant agreements. Even if the district court lacks jurisdiction to order payment of denied funds or grant similar monetary relief, that would not justify dismissing the complaints in full. The court did not decide whether the districts’ policies comply with Title IX, whether their claims are ripe, whether the challenged actions are final, or whether other threshold objections require dismissal. Judge Richardson dissented, concluding that the districts’ claims were fundamentally contractual because they sought restoration of advance grant payments.
Key Takeaways
- A lawsuit involving federal grant funding does not necessarily belong exclusively in the Court of Federal Claims merely because the requested relief could affect the flow of federal money.
- Courts must separately examine the source of each asserted right and the relief requested rather than dismiss an entire complaint because some requested relief may enforce a contractual payment obligation.
- The decision addresses jurisdiction only and expresses no view on whether the school districts’ gender-identity policies violate Title IX.
Why It Matters
The ruling preserves a district-court forum for at least some APA challenges to agency enforcement actions affecting federal grants when the asserted rights arise from a statute rather than the grant agreements themselves. It also underscores that courts should distinguish statutory challenges to agency action from demands for payment or specific performance under federal funding agreements.