Gene A. Folden, Coastal Communications Associates, and Judith A. Longshore, Plaintiffs-appellants, v. United States, Defendant-appellee, 379 F.3d 1344 (Fed. Cir. 2004)

Gene A. Folden, Coastal Communications Associates ("Coastal"), and Judith A. Longshore (collectively, "plaintiffs") appeal the decision of the United States Court of Federal Claims (i) granting the United States' motion to dismiss for failure to state a claim upon which relief could be granted, and (ii) granting the United States' motion to dismiss for lack of subject-matter jurisdiction. Folden v. United States, 56 Fed. Cl. 43 (2003). On the first point, the court determined that plaintiffs failed to state a claim for breach of contract because they were unable to establish the existence of an implied-in-fact contract with the government arising from their filing of lottery applications for cellular communication licenses with the Federal Communications Commission (the "Commission"). Id. at 51-55. On the second point, the court determined that it lacked subject-matter jurisdiction over plaintiffs' claims because it concluded that decisions ancillary to the licensing power of the Commission fall within the exclusive jurisdiction of the United States Court of Appeals for the District of Columbia Circuit pursuant to 47 U.S.C. § 402(b). Id. at 55-60.

We agree with the Court of Federal Claims that plaintiffs' claims are covered by subsection 402(b), which places them within the exclusive jurisdiction of the D.C. Circuit. Accordingly, we affirm the court's dismissal for lack of subject-matter jurisdiction.

BACKGROUND

We begin by setting forth the evolution of the regulatory regime by which the Commission issues telecommunications licenses, for it is essential to understanding plaintiffs' theory of recovery in the case. By statute, the Commission is charged with granting applications for licenses if it finds that "public interest, convenience, and necessity would be served by the granting thereof...." 47 U.S.C. § 309 (2000). To facilitate the allocation of cellular licenses, the Commission divided the United States into two geographic markets — metropolitan statistical areas (MSAs) and rural service areas (RSAs). Folden, 56 Fed. Cl. at 44. In each type of market, the Commission granted two competing licenses: one to a wireline operator, an established local telephone company, and the other ... to a nonwireline operator, any party other than an established local telephone company. Id. Plaintiffs are nonwireline operators in seven RSA markets. Id.

To award the first thirty MSA cellular licenses, the Commission employed comparative hearings.¹  See Certain Cellular Rural Service Area Applications, 14 F.C.C.R. 4619, 4619 (1999). In 1981, however, through an amendment to the Communications Act of 1934 (Communications Act), Congress authorized the Commission to allocate licenses by a system of random selection or lottery. See Omnibus Budget Reconciliation Act of 1981, Pub. L. No. 97-35, ch. 2, 1242, 95 Stat. 357, 736-37 (1981) (codified at 47 U.S.C. 309(i)). The House of Representatives conference report explained that [b]y the establishment of basic qualifications and the elimination of initial comparative hearings, the conferees intend that much of the present delay and expense can be eliminated with no adverse effect on the provision of services to the public. H.R. Conf. Rep. No. 97-208, at 897, reprinted in 1981 U.S.C.C.A.N. 1010, 1259. However, despite agreeing that a lottery would speed service to the public, the Commission declined to adopt a lottery process for allocating telecommunications licenses. Selection from Among Mutually Exclusive Competing Applications Using Random Selection or Lotteries Instead of Comparative Hearings, 89 F.C.C.2d 257, 258, 282-83 (1982) (explaining that although it was clear that Congress intended for the Commission to implement lotteries, various considerations led the Commission to conclude that "the public interest would best be served by declining to implement this statute").

In response, Congress passed a revised lottery statute, which imposed upon the Commission the mandatory requirement that lottery rules and procedures be adopted within 180 days. Communications Amendments Act of 1982, Pub. L. No. 97-259, § 115, 96 Stat. 1087, 1094-95 (1982) (codified at 47 U.S.C. § 309(i) as amended); H.R. Conf. Rep. 97-765, at 38, reprinted in 1982 U.S.C.C.A.N. 2261, 2282 ("1982 Conf. Rep."). Congress instructed that upon selecting a lottery winner, the Commission was to determine whether the winner was qualified pursuant to 47 U.S.C. §§ 308(b), 309(a) (2000).²  1982 Conf. Rep. at 39, reprinted in 1982 U.S.C.C.A.N. at 2283. If the initial winner was determined to be unqualified, the Commission was to conduct a subsequent lottery ... with the same applicant pool with each applicants selection probabilities recomputed as necessary.... Id.

In 1984, the Commission adopted rules for awarding cellular licenses by lottery. 47 C.F.R. 1.821-1.823, 22.33 (1984); see also Selection from Among Mutually Exclusive Competing Cellular Applications Using Random Selection or Lotteries Instead of Comparative Hearings, 98 F.C.C.2d 175, 175, app. B (1984) (explaining the amendments to the regulations providing for the use of lotteries for awarding cellular licenses). Pursuant to the regulations, the Commission was allowed to employ a random selection process, or lottery, to choose the "tentative selectee" from among mutually exclusive license applicants. 47 C.F.R. § 1.822(b). Once the tentative selectee was named, the lottery continued with each of the remaining applicants, with the Commission ranking them in the order in which they were selected as "alternative selectees." Id. The Commission would award the license to the tentative selectee only after determining that it was qualified. Id. If it were not, the Commission would name the next-ranked alternative selectee as the new tentative selectee and then evaluate its qualifications, repeating the process until the license was awarded. Id.

In 1988, the Commission amended the rules pertaining to lotteries. Under the amended regulations, after the tentative selectee was named, each remaining applicant was no longer to be randomly selected and ranked in order of selection. Rather, in accordance with the amended version of 47 C.F.R. § 1.823(a), the Chief of the Common Carrier Bureau and the Managing Director of the Commission were to determine, on a case-by-case basis, the number of remaining applicants to be selected, and thus ranked as alternative selectees, in each lottery. 47 C.F.R. § 1.823(a) (1989); Selection from Among Mutually Exclusive Competing Applications Using Random Selection or Lotteries in the Public Land Mobile and Domestic Cellular Radio Telecommunications Services, 4 F.C.C.R. 7294 (1988).

This was the state of the regulatory regime when plaintiffs filed their applications for cellular licenses in 1988.

We now turn to the process by which plaintiffs applied for cellular licenses. On May 19, 1988, the Commission issued a list of the 428 RSAs for which lotteries would be held and identified the counties that comprised each RSA. Listing of Cellular Rural Service Areas With Component Parts, 53 Fed.Reg. 18,133 (Dep't Commerce May 10, 1988). Plaintiffs submitted applications to the Commission for cellular licenses in seven RSAs. Mr. Folden applied for a cellular license in the Florida 11-Monroe ("Fla.11") RSA on Nov. 4, 1988, and submitted a $200 filing fee. Folden, 56 Fed. Cl. at 45. Coastal submitted a $1400 filing fee with its applications for cellular licenses in the following seven RSAs: Fla. 11 (filed Nov. 4, 1988), North Dakota 3-Barnes ("N.D.3") (filed Sept. 9, 1988), Minnesota 11-Goodhue ("Minn.11") (filed Sept. 16, 1988), Texas 21-Chambers ("Tex.21") (filed Oct. 7, 1988), Arkansas 9-Polk ("Ark.9") (filed Oct. 28, 1988), Puerto Rico 5-Ceiba ("P.R.5") (filed Nov. 10, 1988), and Pennsylvania 4-Bradford ("Pa.4") (filed Dec. 9, 1988). Id. Finally, Michael D. Longshore, the now deceased husband of Ms. Longshore, paid $800 in filing fees for his applications in the N.D. 3, Minn. 11, Tex. 21, and Pa. 4 RSAs. Id.

The Commission issued lottery notices naming plaintiffs among those whose applications had been accepted for filing and providing the date upon which each lottery would occur. The lottery notices explained that each application had been assigned a code number, and that one code number would be drawn for each RSA. Furthermore, each notice stated, "In the event that the application selected cannot be granted, another lottery will be held for that market and another application will be selected from the remaining applications."

Lotteries for the seven licenses were held on the following dates in 1989: April 13 (N.D.3), May 4 (Minn.11), June 14 (Tex.21), August 9 (Ark.9), August 23 (Fla.11), September 20 (P.R. 5), and November 8 (Pa.4). Am. Class Action Compl., ¶¶ 32-39. Only one applicant, the tentative selectee, was chosen in each lottery; none of the plaintiffs was chosen as a tentative selectee. Folden, 56 Fed. Cl. at 45. Competing applicants for these seven licenses subsequently opposed the tentative selectees in proceedings before the Commission. Am. Class Action Compl., ¶ 40. The Commission ultimately determined that none of the tentative selectees was qualified, and their applications were dismissed.³  Folden, 56 Fed. Cl. at 45.

On January 29, 1992, the Commission announced that it would hold relotteries for twenty-nine RSAs, including Tex. 21, on April 8, 1992. This relottery notice stated, "The new lotteries will be conducted among the applications which have already been filed for these markets, minus the dismissed applications. No new applications for these markets will be accepted." As had been the case in the original lottery, each application was to be assigned a code number, only one code number would be drawn for each RSA, and " [i]n the event that the application selected cannot be granted, another lottery will be held for that market and another application will be selected from the remaining applications." The Tex. 21 relottery was held on April 8, and on April 9, the Commission issued the results; neither Coastal nor Mr. Longshore was chosen as the new tentative selectee. However, the new tentative selectee, Alee Cellular Communications ("Alee"), was later disqualified by the Commission on July 24, 1994, and its application was denied. Due in part to events that followed, the Commission never conducted a second relottery for the Tex. 21 RSA.

While plaintiffs' applications were still pending before the Commission, Congress intervened in the process. In 1993, Congress added subsection 309(j) to the Communications Act of 1934. The Omnibus Budget Reconciliation Act of 1993, Pub. L. No. 103-66, tit. VI, § 6002(a), 107 Stat. 312, 387-92 (1993) (codified at 47 U.S.C. § 309(j)) ("Auction Statute"). Subsection 309(j) authorized the Commission to use auctions as a method of selecting among mutually exclusive applications for cellular licenses. The statute also permitted the Commission to continue to use lotteries for applications accepted for filing prior to July 26, 1993. Id. § 6002(e) (2), 107 Stat. at 397.

On March 8, 1994, the Commission adopted rules for implementing the Auction Statute. 47 C.F.R. §§ 1.2101-1.2111 (1994); Implementation of Section 309(j) of the Communications Act — Competitive Bidding, 9 F.C.C.R. 2348 (1994). For those applications filed prior to July 26, 1993, such as plaintiffs', the Commission decided to continue to use lotteries, rather than auctions, to resolve pending applications for cellular unserved areas. Implementation of Section 309(j) of the Communications Act — Competitive Bidding, 9 F.C.C.R. 7387, 7390-93 (1994). Accordingly, in August 1994, the Commission issued a revision of its licensing rules:

Pending applications for authority to operate the first cellular system on a channel block in an MSA or RSA market continue to be processed under the rules governing the processing of such applications that were in effect when those applications were filed, unless the Commission determines otherwise in a particular case.

Revision of Part 22 of the Commission's Rules Governing the Public Mobile Services, 9 F.C.C.R. 6513, app. B (1994) (setting forth 47 C.F.R. § 22.959 (1995)). At the time plaintiffs' applications were filed in 1988, 47 C.F.R. § 22.33 provided for the use of lotteries to distribute cellular licenses.

On July 12, 1996, the Commission issued a relottery notice for six of the seven RSAs at issue (Ark. 9, Fla. 11, Minn. 11, N.D. 3, Pa. 4, and P.R. 5), setting the relottery date for September 18, 1996. As it had done in the case of the January 29, 1992 relottery notice for the Tex. 21 RSA, the Commission explained that each application had been assigned a code number, that only one code number would be drawn for each unserved area, and that " [i]n the event that the application selected cannot be granted, another lottery will be held for that unserved area and another application will be selected from the remaining applications."

However, on September 9, 1996, just before the relotteries were to be held for these six RSA licenses, Cellular Communications of Puerto Rico ("CCPR") filed an ex parte petition requesting that the Commission issue a declaratory ruling that an auction, as opposed to a lottery, would be employed for the P.R. 5 RSA. Folden, 56 Fed. Cl. at 47. In the alternative, CCPR requested that the Commission initiate a rulemaking proceeding to determine whether an auction should be used for this market. Id. On September 10, the Commission's Wireless Telecommunications Bureau (the "Bureau") issued a public notice postponing the six relotteries. Wireless Telecommunications Bureau Postpones Cellular Telecommunications Service Lottery for Rural Service Areas, FCC Public Notice, Mimeo No. 65051 (Sept. 10, 1996). On October 24, 1996, the Bureau issued the following explanation:

[CCPR's] petition raises issues concerning the broader applicability of the use of competitive bidding to award cellular licenses for RSAs for which applications were filed prior to July 26, 1993, where the original tentative selectee has been disqualified and no license has been awarded to date. We will therefore treat CCPR's petition as a petition for rulemaking, and request comment on it, as well as on the applicability of awarding cellular market licenses via competitive bidding in all cellular markets for which applications were filed with the Commission prior to July 26, 1993, and the original lottery winner has been disqualified. Cellular Communications of Puerto Rico, Inc. Petition for Declaratory Ruling or Rulemaking to Determine Whether Competitive Bidding Procedures Should Be Used to License Certain Cellular Rural Service Areas, FCC Public Notice, DA 96-1685 (Oct. 24, 1996) ("CCPR Petition").

Unsatisfied with the Commission's response to its action allowing for the use of auctions rather than lotteries, Congress again injected itself into the licensing process. On August 5, 1997, Congress passed the Balanced Budget Act of 1997, which repealed section 6002(e) of the Auction Statute, which had preserved the Commission's ability to use lotteries for applications filed prior to July 26, 1993. In addition, Congress terminated the Commission's authority to hold lotteries for any license applications except applications for noncommercial educational and public broadcast stations. Balanced Budget Act of 1997, Pub. L. No. 105-33, tit. III, § 3002(a) (2) (B), (a) (4), 111 Stat. 251, 258, 260 (1997) (codified at 47 U.S.C. § 309(i) (5)) ("1997 Budget Act"). Following Congress' action, the Bureau dismissed all pending cellular lottery applications for the following six RSAs: N.D. 3, Minn. 11, Ark. 9, Fla. 11, P.R. 5, and Pa. 4. Certain Cellular Rural Service Area Applications, 14 F.C.C.R. 4619 (1999). The Bureau further determined that the applicants did not qualify for refunds of their filing fees. Id. at 4621. The Coastal and Longshore applications for the Tex. 21 RSA were similarly dismissed without a refund of their filing fees by the Bureau. Certain Cellular Rural Service Area Applications in Market Nos. 599A and 672A, No. DA 99-814 (Apr. 29, 1999). Plaintiffs' request for reconsideration of the dismissals was denied by the Bureau. Certain Cellular Rural Service Area Applications in Market Nos. 599A and 672A, 16 F.C.C.R. 4860 (2001).

Congress subsequently reinstated the original tentative selectees for three of the seven RSAs at issue on December 21, 2000. Launching Our Communities' Access to Local Television Act of 2000, Pub. L. No. 106-553, tit. X, § 1007, 114 Stat. 2762A-128, 2762A-138-40 ("Local TV Act"). In accordance with the statute, the Commission announced on March 16, 2001, that licenses for the Fla. 11, Minn. 11, and Pa. 4 RSAs had been granted to the original tentative selectees. Wireless Telecommunications Bureau Grants Rural Cellular Licenses, 16 F.C.C.R. 5601 (2001).

On January 13, 2001, the Commission proposed rules for auctioning cellular licenses in the four remaining RSAs at issue: Ark. 9, N.D. 3, Tex. 21, and P.R. 5. Competitive Bidding Rules, 16 F.C.C.R. 4296 (2001). On January 16, 2002, the Commission adopted rules to govern auctions for licenses in these four RSA markets, in which no tentative selectee had been selected by relottery prior to July 1, 1997, and for which Congress had not directed the Commission to reinstate the original tentative selectee. 47 C.F.R. §§ 22.228-22.229, 22.969 (2002); Implementation of Competitive Bidding Rules to License Certain Rural Service Areas, 17 F.C.C.R.1960 (2002). The interim operators⁴  won the bidding for the Ark. 9, N.D. 3, and P.R. 5 licenses. Cellular Rural Service Areas Auction Closes, 17 F.C.C.R. 10582 (2002). On November 1, 2002, a Commission Administrative Law Judge dismissed the application of Alee, the winner of the relottery, for the Tex. 21 license. In re Application of Alee Cellular Communications for Authorization to Construct Nonwireline Cellular System in Texas RSA 21 Market 672A, WT Docket No. 02-28, File No. 11025-CL-P-672-A-89 (Nov. 1, 2002).

Plaintiffs did not request review or reconsideration by the full Commission of the Bureau's orders dismissing their applications.⁵  Folden, 56 Fed. Cl. at 48. Instead, they filed a class action complaint in the Court of Federal Claims, which they subsequently amended. Id. In their amended complaint, plaintiffs alleged breach of implied-in-fact contracts by the Commission, takings in violation of the Fifth Amendment, and unconstitutional takings of their contract rights in violation of Article III of the U.S. Constitution.⁶  Plaintiffs sought to recover $144,088,000 in damages. In addition, plaintiffs filed a motion to certify a purported class consisting of all applicants whose applications the Commission had accepted in 1988 for the seven RSA licenses at issue, excluding those who were chosen as tentative selectees and subsequently disqualified. Id. The government responded by filing a motion to dismiss for lack of subject-matter jurisdiction or, in the alternative, for failure to state a claim upon which relief could be granted. Id. at 51. The court granted the government's additional motion to stay consideration of plaintiffs' request for class certification pending resolution of the motion to dismiss. Id. at 48.

The Court of Federal Claims dismissed plaintiffs' amended complaint for failure to state a claim upon which relief could be granted. Id. at 51-55. The court assumed that it had jurisdiction to entertain plaintiffs' breach of implied-in-fact contract claims, in part "because certain case precedent suggests that almost any implied-in-fact [contract] allegation gives [the Court of Federal Claims] jurisdiction to review such claims."⁷  Id. at 52. Reciting the elements of an implied-in-fact contract (mutuality of intent to contract, consideration, lack of ambiguity in offer and acceptance, and authority to bind the government), the court found lacking mutuality of intent to contract. Id. at 52-53. The court declined to adopt plaintiffs' argument that 47 C.F.R. §§ 1.823 and 22.33(a) constituted contractual promises by the Commission to hold lotteries or relotteries. Id. at 53. Rather, because agency rules are subject to change in accordance with recognized procedures, especially when mandated by statute as in this case, and because the regulations did not prohibit the Commission from changing its lottery rules in the future in accordance with those recognized procedures, the court concluded that neither the regulations nor the lottery notices contractually bound the Commission to hold lotteries or relotteries within a definite time, before the statutory change occurred. Id. at 53-54.

The court further relied upon 47 C.F.R. § 22.959 (1995), which provided for the award of cellular licenses by lottery "unless the Commission determines otherwise in a particular case." Id. at 54. This demonstrated to the court that the Commission had not manifested a clear intent to be obligated to use lotteries. Id. The court also invoked the "well established rule" that an agency such as the Commission is permitted to modify its rules pursuant to rulemaking proceedings and must follow the mandates of Congress. Id. Specifically, the D.C. Circuit has ruled that the Commission has the discretion to change license allocation procedures midstream, though it may disrupt the applicants' expectations and alter the competitive balance among them. Id. (citing, inter alia, Bachow Communications, Inc. v. FCC, 237 F.3d 683, 687-88 (D.C. Cir. 2001)). In conclusion, the court determined that " [t]he long tradition of Commission authority to change rules effectively precluded the FCC from making a contractual promise to the plaintiffs." Id. at 55. Because plaintiffs could not establish the Commission's intent to contract, the court ruled that plaintiffs' claims for breach of implied-in-fact contracts failed. Id.

The Court of Federal Claims also ruled in favor of the United States on its motion to dismiss for lack of subject-matter jurisdiction. Id. at 55-60. The court explained that 47 U.S.C. § 402(b) reserves judicial review of Commission licensing decisions exclusively for the D.C. Circuit. Id. at 56. Because the statutory term "station license" in subsection 402(b) (1) encompasses personal communications service ("PCS") licenses, which, in turn, include licenses for cellular telephone service, the court concluded that an appeal by any applicant for a cellular license whose application is denied by the Commission falls within the scope of that subsection. Id. (citing NextWave Pers. Communications, Inc. v. FCC, 254 F.3d 130, 140 (D.C. Cir. 2001)). The court then explained that pursuant to Cook, Inc. v. United States, 394 F.2d 84, 84-85 (7th Cir. 1968), and Kessler v. FCC, 326 F.2d 673, 679 n. 4 (D.C. Cir. 1963), and as confirmed by later D.C. Circuit decisions, subsection 402(b) extends to Commission decisions that are "ancillary" to the nine types of licensing decisions expressly enumerated therein. Folden, 56 Fed. Cl. at 56-57. Plaintiffs' claims, according to the court, involved a decision ancillary to those in subsection 402(b). Id. at 57.

The court was unpersuaded by plaintiffs' argument that the Bureau's dismissals of their applications did not constitute final decisions of the Commission and therefore did not trigger subsection 402(b). Id. Plaintiffs also argued that because they were seeking money damages, the D.C. Circuit could not have had, and the Court of Federal Claims did have, jurisdiction over their claims. Id. at 57-58. The court concluded that plaintiffs' attempt to circumvent established agency and federal court procedures "conjured a contract theory from the mere chance to obtain a cellular license following submission of their applications" in the absence of any contract negotiations and documents. Id. at 57. The court added that plaintiffs had offered no precedent to support their theory of an implied-in-fact contract. Id. at 59. Thus, the court found plaintiffs' claims to be one of those "instances in which a claim that is otherwise within the court's jurisdiction is so insubstantial on its merits that a dismissal may be termed jurisdictional." Id. (quoting Lewis v. United States, 70 F.3d 597, 603 (Fed. Cir. 1995)). According to the court, " [t]o acknowledge the possibility of the existence of a contract under these circumstances for the purposes of jurisdiction, only to, ultimately, find no contract in existence, is to undermine statutory and regulatory procedures carefully designed to address grievances associated with FCC licensing applications." Id. The court therefore dismissed plaintiffs' claims for breach of implied-in-fact contracts.

This appeal followed. We have jurisdiction pursuant to 28 U.S.C. § 1295(a) (3).

ANALYSIS

Whether the Court of Federal Claims properly dismissed plaintiffs' amended complaint for lack of subject-matter jurisdiction is a question of law that we review de novo. W. Co. v. United States, 323 F.3d 1024, 1029 (Fed. Cir. 2003). Subject-matter jurisdiction may be challenged at any time by the parties or by the court sua sponte. Fanning, Phillips & Molnar v. West, 160 F.3d 717, 720 (Fed. Cir. 1998). In deciding whether there is subject-matter jurisdiction, "the allegations stated in the complaint are taken as true and jurisdiction is decided on the face of the pleadings." Shearin v. United States, 992 F.2d 1195, 1195-96 (Fed. Cir. 1993).

In this case, plaintiffs allege subject-matter jurisdiction in the Court of Federal Claims under the Tucker Act, which provides as follows:

The United States Court of Federal Claims shall have jurisdiction to render judgment upon any claim against the United States founded either upon the Constitution, or any Act of Congress or any regulation of an executive department, or upon any express or implied contract with the United States, or for liquidated or unliquidated damages in cases not sounding in tort.

28 U.S.C. § 1491(a) (1) (2000). Although the Tucker Act waives the sovereign immunity of the federal government, it does not provide any substantive rights. United States v. Mitchell, 463 U.S. 206, 216-17, 103 S. Ct. 2961, 77 L. Ed. 2d 580 (1983). In order to invoke successfully the jurisdiction of the Court of Federal Claims pursuant to the Tucker Act, a plaintiff must identify a right to money damages found in the Constitution, a statute or government regulation, or a contract. Id.

To establish Tucker Act jurisdiction in this case, plaintiffs allege implied-in-fact contracts with the Commission. In their amended complaint, they assert that the Commission breached implied-in-fact contracts to hold relotteries to award cellular licenses for the seven RSAs at issue. Plaintiffs' theory is as follows: The Commission released "offers," in the form of public notices, requesting applications for the seven RSA cellular licenses that it planned to award by lottery. Plaintiffs "accepted" those offers by preparing and timely filing letter-perfect applications, and plaintiffs provided "consideration" by paying the requisite filing fees for the seven licenses in accordance with the Commission's lottery rules and procedures. The Commission then issued lottery notices that named plaintiffs as among those whose applications had been accepted, constituting "public acknowledgement" that plaintiffs had fulfilled the necessary requirements to apply for the lotteries. The Commission further promised to hold relotteries for each of the seven RSA licenses should none of the initial winners be qualified, and the Commission confirmed this promise upon disqualifying the original tentative selectee in each of the seven RSAs.

Plaintiffs contend that the Commission's contractual obligations to conduct a relottery for each RSA license arose on the date that the initial lottery winner's application was dismissed or denied. According to plaintiffs, the Commission breached those contracts when it failed to hold relotteries for six of the seven licenses for which plaintiffs had applied, and when it failed to hold a second relottery for the Tex. 21 RSA. For six of the RSA licenses, plaintiffs identify the date of the originally scheduled relotteries, September 18, 1996, as the date of the Commission's breach. For the Tex. 21 RSA, plaintiffs identify April 17, 1997, as the date of the Commission's breach, because between November 25, 1996, and April 17, 1997, plaintiffs assert, "various applicants made formal demands that re-lotteries be held for all remaining RSAs, including Tex. 21," which the Commission allegedly ignored.

Having explained plaintiffs' theory of Tucker Act jurisdiction, we now turn to the statutory and regulatory regime of the Communications Act.

Congress has vested the district courts with jurisdiction over enforcement of Commission orders. 47 U.S.C. § 401(b) (2000). At the same time, in 47 U.S.C. § 402, it has provided for judicial review of Commission decisions. Subsection 402(a) provides:

(a) Procedure. Any proceeding to enjoin, set aside, annul or suspend any order of the Commission under this Act (except those appealable under subsection (b) of this section) shall be brought as provided by and in the manner prescribed in [28 U.S.C. §§ 2342-2351].

In turn, section 2342 of title 28 provides for the courts of appeals to have exclusive jurisdiction to "enjoin, set aside, suspend (in whole or in part), or to determine the validity of" all final orders of the Commission made reviewable by subsection 402(a). 28 U.S.C. § 2342 (2000). Section 2343 sets the proper venue as either the judicial circuit in which the petitioner resides or has its principal office, or the D.C. Circuit. Id. § 2343.

Subsection 402(b), by contrast, specifically provides for the D.C. Circuit to have jurisdiction with respect to the following Commission decisions:

(b) Right to appeal. Appeals may be taken from decisions and orders of the Commission to the United States Court of Appeals for the District of Columbia in any of the following cases:

(1) By any applicant for a construction permit or station license, whose application is denied by the Commission.

(2) By any applicant for the renewal or modification of any such instrument of authorization whose application is denied by the Commission.

(3) By any party to an application for authority to transfer, assign, or dispose of any such instrument of authorization, or any rights thereunder, whose application is denied by the Commission.

(4) By any applicant for the permit required by section 325 of this Act [47 USCS § 325] whose application has been denied by the Commission, or by any permittee under said section whose permit has been revoked by the Commission.

(5) By the holder of any construction permit or station license which has been modified or revoked by the Commission.

(6) By any other person who is aggrieved or whose interests are adversely affected by any order of the Commission granting or denying any application described in paragraphs (1), (2), (3), (4), and (9) hereof.

(7) By any person upon whom an order to cease and desist has been served under section 312 of this Act [47 USCS § 312].

(8) By any radio operator whose license has been suspended by the Commission.

(9) By any applicant for authority to provide interLATA services under section 271 of this Act [47 USCS § 271] whose application is denied by the Commission.

By their plain language, subsections 402(a) and (b) are mutually exclusive. When section 402 was amended in 1952 to its current form, the Senate Committee stated, "The language of this subsection [402(b)], when considered in relation to that of subsection (a), also would make it clear that judicial review of all cases involving the exercise of the Commission's radio licensing power is limited to that court [the D.C. Circuit]." S.Rep. No. 44, at 10 (1951), cited in Cook, 394 F.2d at 86. Appeals from all decisions of the Commission that do not fall within subsection 402(b) are encompassed by the procedures of subsection 402(a). See Columbia Broad. Sys. v. FCC, 211 F.2d 644, 647 (D.C. Cir. 1954).

We think it clear that the D.C. Circuit's jurisdiction over claims that fall within subsection 402(b) is exclusive.⁸  The Supreme Court has ruled that the statutory jurisdiction of the courts of appeals over claims that fall within the scope of subsection 402(a) is exclusive. FCC v. ITT World Communications, Inc., 466 U.S. 463, 468, 104 S. Ct. 1936, 80 L. Ed. 2d 480 (1984) ("Exclusive jurisdiction for review of final FCC orders, such as the FCC's denial of respondents' rulemaking petition, lies in the Court of Appeals." (citing 28 U.S.C. 2342 (1); 47 U.S.C. 402 (a))). It follows that the D.C. Circuit's jurisdiction pursuant to subsection 402(b) is also exclusive: subsections 402(a) and (b) comprise the entire statutory regime by which parties may obtain judicial review of Commission decisions.⁹  Moreover, it has been long settled by the D.C. Circuit that its jurisdiction over claims brought pursuant to subsection 402(b) is in fact exclusive. Sykes v. Jenny Wren Co., 78 F.2d 729 (D.C. Cir.) (concluding for the first time that the jurisdiction of the D.C. Circuit pursuant to subsection 402(b) is exclusive), cert. denied, 296 U.S. 624, 56 S. Ct. 147, 80 L. Ed. 443 (1935);¹⁰  City of Rochester v. Bond, 603 F.2d 927, 932-35 (D.C. Cir. 1979) ("In § 402 of the Communications Act ... Congress has, we think, prescribed the exclusive mode of judicial review of such controversies as this....") (relying on Sykes); Sprint Communications Co. L.P. v. FCC, 274 F.3d 549, 552 (D.C. Cir. 2001).

In the Communications Act, Congress enacted a comprehensive statutory and regulatory regime governing orders of the Commission. Congress vested the district courts with jurisdiction over enforcement of Commission orders, 47 U.S.C. § 401(b), and the courts of appeal and the D.C. Circuit with jurisdiction over judicial review of such orders, id. § 402(a), (b). At the same time, section 155(c) (7) requires a party to appeal first within the Commission before pursuing a judicial remedy pursuant to section 402. Id. § 155(c) (7); see supra, note 5. Congress also imposed various filing deadlines for appeals from Commission orders, provided for interested parties to receive notice of an appeal, required appeals to include specific information, and prescribed the procedure by which an interested party may intervene in appeal proceedings. Id. § 402(c)-(e). We have explained that " [w]hen such a `specific and comprehensive scheme for administrative and judicial review' is provided by Congress, the Court of Federal Claims' Tucker Act jurisdiction over the subject matter covered by the scheme is preempted." Vereda, Ltda v. United States, 271 F.3d 1367, 1375 (Fed. Cir. 2001) (quoting St. Vincent's Med. Ctr. v. United States, 32 F.3d 548, 549-50 (Fed. Cir. 1994), and citing United States v. Fausto, 484 U.S. 439, 454-55, 108 S. Ct. 668, 98 L. Ed. 2d 830 (1988); Appalachian Reg'l Healthcare, Inc. v. United States, 999 F.2d 1573, 1577 (Fed. Cir. 1993)).

Plaintiffs contend, however, that the D.C. Circuit's jurisdiction pursuant to subsection 402(b) and Tucker Act jurisdiction for the Court of Federal Claims may coexist. In making this argument, they rely on Cellco Partnership v. United States, 54 Fed. Cl. 260 (2002). In Cellco Partnership, Cellco, doing business as Verizon Wireless, filed suit against the government in the Court of Federal Claims for breach of contracts allegedly formed when the Commission accepted its bid for reauctioned spectrum licenses. Cellco asserted that the Commission failed to timely deliver the licenses. At the same time, pursuant to subsection 402(b), Cellco appealed to the D.C. Circuit from the Commission's order relating to the refund of Cellco's down payment for the licenses. Id. at 261. Citing the possibility of inconsistent rulings by the two tribunals, the government moved to stay proceedings in the Court of Federal Claims, but the motion was denied. In denying the motion to stay, the court noted that the D.C. Circuit could decide that it lacked jurisdiction to decide the contract claim. It also noted that the D.C. Circuit lacked jurisdiction to decide Cellco's money damages claim. Id. at 262-63.

Plaintiffs' reliance on Cellco Partnership is misplaced. We are not bound by decisions of the Court of Federal Claims. In any event, to the extent that the decision suggests that the Court of Federal Claims may exercise concurrent jurisdiction with the D.C. Circuit over claims that fall within the scope of subsection 402(b), we reject it. The availability of concurrent jurisdiction in district court over claims under subsection 402(b) was explicitly rejected in City of Rochester, 603 F.2d 927. While recognizing that subsection 402(b) did not specify whether concurrent jurisdiction in the district court could exist, the D.C. Circuit nevertheless concluded that it could not. Id. at 932. The court ruled that the plaintiffs' suit to set aside the Commission's issuance of a construction permit, which is encompassed by subsection 402(b), could not be brought in district court. The court's logic applies with equal force to the possibility of concurrent jurisdiction in the Court of Federal Claims. The court stated:

The principles which frame our decision are unexceptionable... Congress, acting within its constitutional powers, may freely choose the court in which judicial review may occur.... If ... there exists a special statutory review procedure, it is ordinarily supposed that Congress intended that procedure to be the exclusive means of obtaining judicial review in those cases to which it applies.

* * * * * *

The rationale for statutory review is that coherence and economy are best served if all suits pertaining to designated agency decisions are segregated in particular courts. The choice of forum is, as we have said, for Congress....

Id. at 931 (citing City of Tacoma v. Taxpayers of Tacoma, 357 U.S. 320, 336, 78 S. Ct. 1209, 2 L. Ed. 2d 1345 (1958)); id. at 936. The court further noted that finding concurrent jurisdiction under a general jurisdictional mandate (such as the Tucker Act in this case) would completely undo the requirement of a timely petition for review and the finality of agency orders, which Congress deliberately chose to include in the statutory scheme, a choice [the court] may not second-guess. Id. at 935. Plaintiffs' suit is indistinguishable from City of Rochester.

In sum, if subsection 402(b) applies in this case, the D.C. Circuit had exclusive jurisdiction over plaintiffs' claims.¹¹  It is to that question that we now turn.

Subsection 402(b) (1) applies to licensing decisions of the Commission, specifically, appeals by "any applicant for a ... station license, whose application is denied by the Commission."¹²  It is undisputed in this case that, strictly speaking, plaintiffs are not appealing from any formal denial of their applications, for plaintiffs do not contend that their applications for the seven RSA licenses were actually denied — only that the relotteries by which the Commission was allegedly obligated to award those licenses were canceled. Plaintiffs' claims therefore do not fall within the literal language of subsection 402(b) (1). Nevertheless, in addition to the licensing decisions expressly enumerated therein, subsection 402(b) also extends to licensing decisions of the Commission that are "ancillary" to those set forth in subsections (1)-(9). See Tomah-Mauston Broad. Co. v. FCC, 306 F.2d 811, 811-12 (D.C. Cir. 1962); Cook, 394 F.2d at 84-85. The applicability of subsection 402(b) (1) to plaintiffs' claims thus turns not on whether plaintiffs' claims fall within the literal statutory language, but whether their claims fall within the scope of Commission licensing decisions that are ancillary to those set forth in subsection 402(b). The question before us, then, is whether the Commission's failure to hold relotteries for the seven RSA licenses at issue is "ancillary" to the Commission's decision to deny an applicant a station license under subsection 402(b) (1).¹³ 

The Court of Federal Claims determined that subsection 402(b) (1) applied to plaintiffs' claims. Folden, 56 Fed. Cl. at 56-58. After reviewing the caselaw that extends subsection 402(b) (1) to Commission orders that are ancillary to an exercise of its licensing power under subsection 402(b), the court concluded, "Had the plaintiffs exhausted their administrative remedies, an appeal of the [Commission] decision would have been proper in the [D.C. Circuit], the court with statutory authority to review licensing decisions." Id. at 57.

On appeal, plaintiffs point to Freeman Engineering Associates, Inc. v. FCC, in which the D.C. Circuit determined that the Commission's dismissal of certain preference applications was neither a denial of a license nor a matter ancillary to the denial of a license, and that therefore the dismissal did not fall within the scope of subsection 402(b). 103 F.3d 169, 177-78 (D.C. Cir. 1997). Thus, plaintiffs argue that because no application for a license was formally granted or denied in the Commission's decision not to hold relotteries for the seven RSA licenses, and because, to use plaintiffs' words, "the dismissal orders were not ancillary to any [Commission] order granting or denying any license application," subsection 402(b) (1) does not encompass their claims.

In response, the government asserts that subsection 402(b) (1) does encompass plaintiffs' claims, thereby providing the D.C. Circuit with exclusive jurisdiction. The government refers us to Cook, 394 F.2d at 87, in which the Seventh Circuit held that orders returning the petitioner's untimely license application were ancillary to an exercise of the Commission's licensing power, and to Kessler, in which the D.C. Circuit held that it possessed exclusive jurisdiction to review a Commission order refusing to accept the appellants' license applications. 326 F.2d at 679 n. 4. The government further cites, inter alia, Tomah-Mauston, 306 F.2d at 812, which ruled that a Commission order denying a petition to stay and revoke a construction permit was ancillary to the grant of a construction permit, and Metropolitan Television Co. v. United States, 221 F.2d 879 (D.C. Cir. 1955), which ruled that the D.C. Circuit possesses exclusive jurisdiction over orders denying protests and rehearing even though neither is specified in subsection 402(b).

We agree with the Court of Federal Claims that subsection 402(b) (1) encompasses plaintiffs' claims. In our view, a Commission decision not to hold relotteries is ancillary to the denial of a station license as set forth in subsection 402(b) (1).¹⁴ 

With regard to the substance of subsection 402(b), the Senate Report explained in 1951, "The language of this subsection [402(b)], when considered in relation to that of subsection (a), also would make it clear that judicial review of all cases involving the exercise of the Commission's radio licensing power is limited to that court [the D.C. Circuit]." S.Rep. No. 44, at 10 (emphasis added). Relying on this language, the D.C. Circuit ruled as early as 1962 that appeals of Commission orders that are "ancillary" to those explicitly set forth in subsection 402(b) also fall within the scope of the statutory requirement that the D.C. Circuit have exclusive jurisdiction. Tomah-Mauston, 306 F.2d at 811. The court in Tomah-Mauston, relied upon three previous cases: (i) Metropolitan Television, 221 F.2d 879, in which the D.C. Circuit treated orders denying protests of a decision changing the frequency and power of a broadcasting station and orders denying rehearing as reviewable under subsection 402(b), though neither is set forth in the statute; (ii) Federal Broadcasting Sys., Inc. v. FCC, 239 F.2d 941 (D.C. Cir. 1956), in which the court accepted jurisdiction pursuant to subsection 402(b) (6) over an appeal from the Commission's grant of a petition requesting that authorization for a television permit remain in effect pending protest proceedings of that authorization; and (iii) Gerico Investment Co. v. FCC, 240 F.2d 410, 411 n. 1 (D.C. Cir. 1957), in which the court explained that ordinarily there is no question of the D.C. Circuit's jurisdiction pursuant to subsection 402(b) (1) over an appeal from the grant of a construction permit and "orders ancillary thereto." Armed with this precedent, the court in Tomah-Mauston determined that an appeal of a petition to stay and revoke a construction permit, while not expressly set forth in subsection 402(b), nevertheless fell within the exclusive jurisdiction of the D.C. Circuit. 306 F.2d at 811. Likewise, also relying on Senate Report No. 44, at 10, the Seventh Circuit adopted this position in Cook, holding that Commission orders returning an application and denying reconsideration of a return order are "ancillary" to the exercise of the Commission's "licensing power." 394 F.2d at 86-87.

Perhaps most analogous to plaintiffs' situation is Kessler. In that case, in a Report and Order issued on May 10, 1962, the Commission announced a "freeze" on the acceptance of applications for most classes of standard radio broadcast stations, effective at the close of business that day. Kessler, 326 F.2d at 678. The Order explained that the Commission intended to "issue a notice of proposed rulemaking" related to the potential revision of its rules governing AM broadcast assignments. Id. Applicants had tendered their applications on or before June 15, 1962, after the freeze order was issued but before it was published, and the applications were returned by the Commission unfiled. Id. at 686 n. 11. Applicants appealed the Commission's refusal to accept their applications. The D.C. Circuit held that the Commission's refusal to accept the applications fell within the ambit of subsection 402(b) (1) because, as the government argued and the applicants did not dispute, the freeze order "in effect denie [d] their applications...." Id. at 679 n. 4. Thus, the court exercised its jurisdiction pursuant to subsection 402(b) (1). Id.

From these cases, we conclude that the Commission's decision not to hold relotteries on September 18, 1996, for six of the RSA licenses, and its failure to hold a relottery for the Tex. 21 RSA license by April 17, 1997, constituted actions ancillary to the licensing power of the Commission, specifically to the denial of a station license set forth in subsection 402(b) (1).¹⁵  We think that the Commission's failure to hold relotteries when plaintiffs had already filed their lottery applications is just as ancillary to subsection 402(b) as the Commission decisions set forth in the cases above. For example, in Kessler, the applicants had not even filed their applications; yet, the court held that the Commission's refusal to accept their applications was ancillary to the denial of a license. Plaintiffs' claims here are even more closely related to the decisions listed in subsection 402(b) (1): they had filed their applications for the seven RSA licenses some eight years earlier; thus, by failing to hold the relotteries, the Commission necessarily determined that plaintiffs' lottery applications would not result in their receiving licenses. Rather than, as the court characterized it in Kessler,"in effect" denying their applications, the Commission here "in fact" denied plaintiffs' lottery applications, albeit without issuing a formal order.

Finally, plaintiffs rely upon Freeman Engineering and Waterway Communications Sys., Inc. v. FCC, 851 F.2d 401 (D.C. Cir. 1988). Neither case helps plaintiffs, however. In Freeman Engineering, the Commission had dismissed the appellants' applications for "pioneer's preferences,"¹⁶  not applications for the licenses themselves. 103 F.3d 169. The appellants sought to challenge the action in the D.C. Circuit, which rejected the attempt. The court explained that subsection 402(b) did not apply because the "Commission does not grant licenses at the time a pioneer's preference is awarded. Nor does the grant of a preference irrevocably commit the Commission to grant a license." Id. at 174 (citing Waterway Communications, 851 F.2d at 405). In contrast, plaintiffs' lottery applications in this case were denied, along with any chance to receive a license by lottery, when the Commission decided not to hold relotteries. In other words, once the Commission failed to hold relotteries, plaintiffs could not be awarded any of the RSA licenses on the basis of their lottery applications.

Waterway Communications also is distinguishable from this case. Waterway Communications System, Inc. ("Watercom") petitioned the Commission to deny the pending applications for certain licenses filed by its competitor, Radio Television of Louisiana, Inc. ("RTL"). Waterway Communications, 851 F.2d at 402. The Commission rejected Watercom's petition to deny, and its subsequent petition for reconsideration of the Commission's rejection of its petition, and directed that RTL's applications be processed in the ordinary course of business. Id. at 403. Watercom attempted to appeal to the D.C. Circuit the Commission's order denying its petition to deny RTL's applications. The court, however, dismissed its appeal. Explaining that subsection 402(b), on its face, "requires as a trigger the grant or denial of a license application," the court concluded that the Commission's order neither was a final license grant, nor irrevocably committed the Commission to grant RTL the licenses. Id. Thus, according to the court, the order was not appealable pursuant to subsection 402(b). Id. at 403-04. Again, plaintiffs' case is distinguishable; their license applications were denied when the Commission failed to hold relotteries.

In sum, we conclude that the Commission's failure to hold relotteries for the seven RSA licenses at issue was an action ancillary to the denial of an application for a station license, as set forth in subsection 402(b) (1). Therefore, subsection 402(b) provided for jurisdiction in the D.C. Circuit over plaintiffs' claims had there been exhaustion of administrative remedies.

CONCLUSION

Plaintiffs' amended complaint seeks judicial review of the Commission's decision not to hold relotteries for the seven RSA licenses at issue. Such a decision by the Commission is ancillary to the denial of a license application, as set forth in 47 U.S.C. § 402(b) (1). For these reasons, plaintiffs' claims are subject to the exclusive jurisdiction of the D.C. Circuit. We therefore affirm the Court of Federal Claims' dismissal of plaintiffs' suit for lack of subject-matter jurisdiction.

AFFIRMED.