ODonnell_et_al_v_LSCdecision.txt

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT
HUGH F. O'DONNELL, Executive � Director of Client Centered Legal
Services of Southwest Virginia, Incorporated; CLIENT CENTERED LEGAL
SERVICES OF SOUTHWEST VIRGINIA, INCORPORATED,
Plaintiffs-Appellants,
� No. 00-1901
v.
JOHN EIDLEMAN, Program Specialist for the Legal Services
Corporation; LEGAL SERVICES CORPORATION; JOHN MCKAY, President of
the Legal Services Corporation,
Defendants-Appellees. �
Appeal from the United States District Court for the Western
District of Virginia, at Big Stone Gap. James P. Jones, District
Judge. (CA-00-33-2)
Argued: February 28, 2001
Decided: June 25, 2001
Before WILKINS and WILLIAMS, Circuit Judges, and HAMILTON,
Senior Circuit Judge.
Vacated and remanded with instructions by unpublished per curiam
opinion.
O'DONNELL v. EIDLEMAN

COUNSEL
ARGUED: Gerald L. Gray, GERALD GRAY LAW FIRM, Clintwood,
Virginia, for Appellants. Thomas Samuel Williamson, Jr., COVINGTON
& BURLING, Washington, D.C., for Appellees. ON BRIEF: Andrew J.
Heimert, COVINGTON & BURLING, Washington, D.C.; Paul R.
Thomson, Jr., WOODS, ROGERS & HAZLE-GROVE, P.L.C., Roanoke,
Virginia, for Appellees.
Unpublished opinions are not binding precedent in this circuit.
See Local Rule 36(c).


OPINION
PER CURIAM:
Client Centered Legal Services of Southwest Virginia,
Incorporated and Hugh F. O'Donnell, its executive director
(collectively, "CCLS"), appeal an order of the district court
granting judgment in favor of the Legal Services Corporation and
two of its officers (collectively, "the LSC") on CCLS's claims that
various actions by the LSC exceeded its statutory and regulatory
authority. For the reasons set forth below, we conclude that
Congress has not authorized judicial review of these claims. We
therefore vacate and remand with instructions to dismiss.
I.
In 1974, Congress enacted the Legal Service Corporation Act
("LSCA"), which created the LSC for the purpose of providing legal
assistance to indigent people in civil matters. See 42 U.S.C.A. §
2996 (West 1994). The LSC does not itself provide legal services,
but rather grants federal funds to legal services programs across
the country. CCLS, which provides legal services to indigent people
in the coalfields region of southwestern Virginia, has been an LSC
grantee since 1980.
O'DONNELL v. EIDLEMAN
This litigation involves CCLS's challenge to certain actions
taken by the LSC in connection with the LSC's consolidation of
services areas (undertaken as a cost-cutting measure) and
implementation of a competitive bidding program for grant money.
Following a bench trial, the district court rejected CCLS's claims
on the merits.
II.
In our recent decision in Regional Management Corp. v. Legal
Services Corp., 186 F.3d 457 (4th Cir. 1999), we concluded that a
decision by the LSC regarding certain lobbying practices by grant
recipients was not subject to judicial review in an action by a
lender claiming injury as a result of such lobbying. See Reg'l
Mgmt., 186 F.3d at 461-64. First, we concluded that the LSC is not
a federal agency for purposes of judicial review under the
Administrative Procedures Act. See id. at 462. Second, we held that
the LSCA did not explicitly authorize a private right of action
against the LSC. See id. Finally, we determined that "there [was]
no basis for finding that Congress intended to create an implied
private right of action" against the LSC. Id.
In determining that Congress did not implicitly establish a
right of action, we considered the four factors set forth in Cort
v. Ash, 422
U.S. 66, 78 (1975) (internal quotation marks omitted): (1)
whether"the plaintiff [is] one of the class for whose especial
benefit the statute was enacted"; (2) whether "there [is] any
indication of legislative intent, explicit or implicit, either to
create such a remedy or to deny one"; (3) whether "it [is]
consistent with the underlying purposes of the legislative scheme
to imply such a remedy"; and (4) whether "the cause of action [is]
one traditionally relegated to state law, in an area basically the
concern of the States, so that it would be inappropriate to infer a
cause of action based solely on federal law." We determined that
the first Cort factor was controlling: Lenders affected by the
lobbying activities of LSC grantees were not "part of any special
class to be benefitted by" the LSCA. Reg'l Mgmt., 186 F.3d at 463
(internal quotation marks omitted). Rather, we noted that Congress
specifically intended the LSCA to benefit "indigents who have legal
grievances but who are unable to afford the legal means necessary
to redress them." Id. (internal quotation marks omitted).
O'DONNELL v. EIDLEMAN
The reasoning of Regional Management is controlling here. As we
held in Regional Management, the LSCA was intended by Congress for
the "especial benefit" of indigent persons in need of legal
services. Although legal services programs such as CCLS are an
integral part of the process of delivering those services, the
programs themselves are not the beneficiaries of the Act. Because
CCLS is not part of the class Congress sought to benefit in
enacting the LSCA, we must conclude that Congress did not intend to
imply a private cause of action by CCLS to challenge the LSC's
exercise of its statutory and regulatory duties.*
III.
For the reasons set forth above, we conclude that the district
court was without authority to review the actions of the LSC.
Accordingly, we vacate the order of the district court and remand
with instructions to dismiss.
VACATED AND REMANDED WITH INSTRUCTIONS
*We note that three other circuits have concluded that rational
basis judicial review is available for decisions of the LSC that
affect grantees. See Tex. Rural Legal Aid, Inc. v. Legal Servs.
Corp., 940 F.2d 685, 697
(D.C. Cir. 1991); San Juan Legal Servs., Inc. v. Legal Servs.
Corp., 655 F.2d 434, 438-39 (1st Cir. 1981); Spokane County Legal
Servs., Inc. v. Legal Servs. Corp., 614 F.2d 662, 668-69 (9th Cir.
1980). We find these cases distinguishable for the reasons stated
in Regional Management. See Reg'l Mgmt., 186 F.3d at 464.