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UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF MARYLAND
SOUTHERN DIVISION

CHAMBER OF COMMERCE OF THE )

UNITED STATES OF AMERICA, et al., )
)
Plaintiffs ) 8:08-CV-03444-AW
)
v. )
)
JANET NAPOLITANO, et al., )
)
Defendants. )
____________________________________)

DEFENDANTS’ OPPOSITION TO PLAINTIFFS’

EMERGENCY MOTION FOR AN INJUNCTION PENDING APPEAL

Nearly a week after losing on all counts on the merits, and with just three court days

before the applicability date of the rule at issue, plaintiffs approach this Court to seek an

injunction against the rule that the Court has found to be a lawful use of the President’s

Procurement Act power. Plaintiffs’ motion, like the underlying claims in this case, is without

merit.

Plaintiffs rely principally on cases concerning applications for a stay of a district court

order. Here, however, plaintiffs are not simply seeking a stay of this Court’s order; they are

seeking the “‘extraordinary and drastic remedy’” of an injunction. Munaf v. Geren, 128 S. Ct.

2207, 2219 (2008) (quoting 11A Wright & Miller § 2948 (2d ed. 1995)). As the Supreme Court

has recently reiterated, “[a] preliminary injunction is an extraordinary remedy never awarded as

of right.” Winter v. Natural Resources Defense Council, Inc., 129 S. Ct. 365, 376 (2008). A

plaintiff seeking such extraordinary relief “must establish that he is likely to succeed on the

merits, that he is likely to suffer irreparable harm in the absence of preliminary relief, that the

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balance of equities tips in his favor, and that an injunction is in the public interest.” Id. at 374;

accord W.V. Ass’n of Club Owners v. Musgrave, 553 F.3d 292, 298 (4th Cir. 2009). The failure

to establish any one of these four factors necessitates denial of injunctive relief. See Winter, 129

S. Ct. 365 (denying injunction because plaintiff had failed to establish likelihood of irreparable

harm); CitiFinancial, Inc. v. Lightner, 2007 WL 3088087, at *2 (N.D.W.V. 2007) (“[T]he Fourth

Circuit set forth these factors as four independent criteria, each of which must be met, rather than

as a four-part balancing test.”). Plaintiffs bear the burden of proof on each factor. Direx Israel,

Ltd. v. Breakthrough Med. Corp., 952 F.2d 802, 812 (4th Cir. 1991).

I. Plaintiffs Do Not Have a Likelihood of Success on the Merits

As this Court has held, “[a] party seeking a stay pending appeal must make a strong

showing of likely success on the merits of the appeal.” St. Agnes Hospital v. Riddick, 751 F.

Supp. 75, 76 (D. Md. 1990) (quotation omitted). Moreover, while some cases, including

Riddick, suggest that a difficult question on the merits may be sufficient for injunctive relief, the

Supreme Court’s recent opinion in Munaf v. Geren makes it clear that such relief requires that it

be more likely than not that the plaintiff will succeed on the merits. 128 S. Ct. at 2219; see

also Lorillard Tobacco Co. v. S & M Brands, Inc., 616 F. Supp. 2d 581, 586 (E.D. Va. 2009)

(applying Munaf); Signature Flight Support Corp. v. Landow Aviation Ltd. Partnership, 2009

WL 111603, at *2 (E.D. Va. Jan. 14, 2009) (same). Even before Munaf, in Long v. Robinson, the

principal authority relied on by plaintiffs, Judge Winter found that plaintiffs had not established

a likelihood of success on the merits where “[a]ll of the legal authorities which the parties claim

[to be] pertinent were considered by the district judge and appear to have been correctly

applied.” 432 F.2d 977, 980 (4th Cir. 1970) (Winter, J., in chambers). Similarly, in this case, it

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is apparent that the Court considered all of the legal authorities presented by the parties, and that

the District Court correctly applied them.

The Court methodically examined each of plaintiffs’ seven counts and found each to be

without merit, in most cases for two independent reasons. See Docket 51, at 9-24. In Count I,

plaintiffs contended that the Secretary of Homeland Security violated IIRIRA by issuing a

Designation Notice. The Court correctly rejected this claim on two independent grounds: (1) the

Secretary is not “requiring any person or entity to do anything” as Secretary Chertoff merely

engaged in “a ministerial act”; and (2) entry into government contracts “is a voluntary choice.”

Id. at 9. In Count II, plaintiffs contended that the Court should rewrite IIRIRA to change the

term “Secretary of Homeland Security” to “entire Executive Branch.” The Court correctly

rejected this invitation, holding: (1) “The text of [IIRIRA] is clear [and had] Congress intended

anything else, Congress easily could have drafted this section to apply to the President or other

agencies”; and (2) “the decision to be a government contractor is voluntary.” Id. at 10-14.

In Count III, plaintiffs asked this Court to substitute its judgment for the President’s

judgment as to what will promote efficiency and economy in government procurement. The

Court again declined plaintiffs’ invitation to exceed the judicial role, noting that “[t]he President

and his Administration are in a better position than this Court to make such determinations.” Id.

at 17. In this, the Court joined the unanimous position of courts which have considered

Procurement Act challenges and declined to substitute judicial opinion for the conclusions of the

President.

Counts IV and V were quickly dispatched by the Court and understandably so given their

lack of substance. See id. at 18-19. Count IV is meritless because there is nothing in IIRIRA’s

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text that “prohibits the Executive Branch from using E-Verify for current employees.” Id. at 18.

Count V fails because plaintiffs “have conceded that they are not asserting that the Procurement

Act violates the non-delegation doctrine,” and this is the only Constitutional challenge that could

be brought to the President’s statutorily authorized action. Id. at 19.

Finally, the Court found plaintiff’s technical claims to be without merit both because the

FAR Council complied with both the Federal Procurement Policy Act and the Regulatory

Flexibility Act, and because, even if plaintiffs’ could establish a violation, the remedy would not

involve striking down the rule. Id. at 19-24.

Moreover, plaintiffs’ assertion that this case presents issues of “first impression” is true,

if at all, only because of the forum which the plaintiffs chose. The issues in this case have been

decided in other circuits in the same way that this Court decided them here. Indeed, in

dismissing Counts I-III, this Court followed the persuasive reasoning of the D.C. Circuit in AFL

CIO v. Kahn, 618 F.2d 784 (D.C. Cir. 1979).1 Similarly, the Ninth Circuit interpreted IIRIRA §

402(a) in the same manner as this Court in Chicanos Por La Causa, Inc. v. Napolitano, 558 F.3d

856, 867 (9th Cir. 2009). Plaintiffs have simply taken meritless claims that would be foreclosed

by precedent in other circuits, and filed them in a circuit that has not yet addressed them. This is

not sufficient to permit the extraordinary and drastic remedy of injunctive relief.

1
In dismissing Count III, the Court relied on numerous cases in addition to Kahn:
AFGE v. Reagan, 870 F.2d 723, 727-28 (D.C. Cir. 1989); City of Albuquerque v. United States
Dep’t of the Interior, 379 F.3d 901, 914 (10th Cir. 2004); UAW-Labor Employment & Trading
Corp. v. Chao, 325 F.3d 360, 366-67 (D.C. Cir. 2003); Farkas v. Texas Instrument, Inc., 375
F.2d 629, 632 n.1 (5th Cir. 1967).

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II. Plaintiffs Have Not Established that They Are Likely To Suffer Irreparable Harm

Plaintiffs seeking injunctive relief must “demonstrate that irreparable injury is likely in

the absence of an injunction.” Winter, 129 S. Ct. at 375 (emphasis in original); accord Nat’l

R.R. Passenger Corp. v. Railway Express, LLC, 2009 WL 2169053, at *2 (D. Md. July 17, 2009)

(“Irreparable harm must be likely, not merely possible.”). Plaintiffs allege that some of their

members will suffer irreparable harm in the absence of an injunction because users of E-Verify

will incur some costs. See Pl’s Mem. at 7-8. But, even assuming that monetary damages can

constitute irreparable harm – which is not normally the case – the very declaration relied on by

plaintiffs demonstrates that members will not internalize these costs but will simply bill them

back to the Federal Government. See DiFranco Decl. ¶ 30 (“Of course, these additional costs

will be incorporated into Quality Support’s pricing structure, thereby increasing the overall cost

to the Federal Government when it contracts with Quality Support.”). Finally, any of plaintiffs’

members who wish to avoid the inconvenience of electronically verifying the work status of its

employees can simply abstain from entering into contracts requiring E-Verify.

Plaintiffs also seek to assert the interest of their members’ employees whom, they

contend, “will face an increased risk of employment discrimination.” Pl’s Mem. at 8. But

plaintiffs do not have standing to assert the interests of employees, particularly because if there is

any employment discrimination it would be done by the employers, i.e. plaintiffs’ members.

Employment discrimination is not a direct result of the rule, it is a direct result of the misuse of

E-Verify by employers, conduct that violates employment laws that are vigorously enforced by

the Department of Justice.

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In short, plaintiffs have failed their burden of establishing irreparable harm and thus their

motion must be denied.

III. The Balance of Equities Favors Defendants and an Injunction Would Be Against the
Public Interest

While plaintiffs have not established a likelihood of irreparable harm, the government

would be irreparably harmed by the granting of an injunction pending appeal and an injunction

would harm the public interest. “In exercising their sound discretion, courts of equity should pay

particular regard for the public consequences in employing the extraordinary remedy of

injunction.” Winter, 129 S. Ct. at 376-77 (quotation omitted). Plaintiffs’ interests are purely the

private pecuniary interests of their members, and even these are questionable. In contrast, where

the interests of defendants – which include the United States itself – are harmed, the public

interest is similarly harmed.

As the Court found, the rule in this case aims to ensure the reliability of government

contractors in order to improve economy and efficiency in government contracting. The FAR

Council voluntarily delayed the applicability of the rule for two reasons: (1) to allow the current

administration sufficient time to review the Executive Order and rule, and (2) to allow this

litigation to proceed such that the issue could be fully briefed and decided on the merits by this

Court before the applicability date. Now, the current administration having concluded that the

Executive Order and rule are correct policy, and this Court having determined that the Executive

Order and rule are lawful, there is no justification for delaying a measure that will help protect

the government’s procurement process from avoidable disruption. This is particularly true given

that an appeal could take months or even years. Plaintiffs completely ignore this important

interest of both defendants and the public.

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Moreover, contrary to plaintiffs’ contention, the ongoing legislative activity in Congress

does not militate in favor of a stay. The Senate has passed language that, in plaintiffs’ words,

“would not only extend the life of E-Verify, but would require government contractors to

participate in E-Verify.” Pl’s Mem. at 11. The House, by contrast has passed language that

would extend E-Verify but “does not include language requiring contractors to participate in E-

Verify.” Id. Thus, the two proposals are to mandate the same or similar result as the rule in this

case, thus potentially making the rule redundant, or to simply leave the rule in effect. Either

way, use of E-Verify will be a term of federal contracting, the only debate is whether it will be

inserted by statute or by rule. In either case, the injunction sought by plaintiffs would defeat

Congressional and Executive intent and therefore disserve the public interest in lawful

government by the elected branches.

CONCLUSION

For the foregoing reasons, plaintiffs’ motion for an injunction should be denied.

September 3, 2009 Respectfully submitted,

TONY WEST
Assistant Attorney General

SANDRA M. SCHRAIBMAN
Assistant Branch Director

/s/ Jeffrey M. Smith

JEFFREY M. SMITH
U.S. Department of Justice
20 Massachusetts Ave., N.W., Room 7144
Washington, D.C. 20001
Tel: (202) 514-5751
Fax: (202) 616-8470

Counsel for Defendants