Appeal from the United States District Court for the Southern District of Indiana, Indianapolis Division. No. 03 C 1810-Larry J. McKinney, Judge.
The opinion of the court was delivered by: Sykes, Circuit Judge.
Before POSNER, EVANS, and SYKES,Circuit Judges.
This case returns to us following the Supreme Court's order granting certiorari, vacating our prior judgment, and remanding for further consideration in light of Hein v. Freedom from Religion Foundation, Inc., 551 U.S. ___, 127 S.Ct. 2553 (2007). Univ. of Notre Dame v. Laskowski, 127 S.Ct. 3051 (2007). The issue is whether the plaintiff-taxpayers have standing under Flast v. Cohen, 392 U.S. 83 (1968), to maintain an Establishment Clause challenge to a congressional grant after the funds have been fully paid and the grant has expired.
The taxpayers sued the Secretary of Education to enjoin payment of the money but did not seek a preliminary injunction. The grant recipient, the University of Notre Dame, intervened to protect its interest in the funds-$500,000 designated for a teacher-training program. While the suit was pending, however, the grant expired and the district court dismissed the case as moot. The taxpayers appealed and this panel split; the majority reversed, holding that although the claim against the Secretary of Education was moot, the suit was not. Laskowski v. Spellings,443 F.3d 930, 933 (7th Cir. 2006). This conclusion flowed from the majority's view that restitutionary relief could be obtained against Notre Dame in the form of an order to repay the grant to the U.S. Treasury. Id. at 934-35.
That ruling has been called into question by the Supreme Court's decision in Hein, another Establishment Clause case from this circuit involving the issue of taxpayer standing-specifically, the question whether the Flast exception to the rule against taxpayer standing extended to suits challenging Executive Branch programs funded by general appropriations. Hein answered this question "no," leaving the Flast exception in place but narrowly confining it to its facts.
After Hein, taxpayers continue to have standing to sue for alleged Establishment Clause violations wrought by specific congressional appropriations under the Article I, Section 8 taxing and spending power, but this standing extends only to suits to enjoin the violation. As circumscribed by Hein, the Flast exception does not extend to suits for retrospective monetary relief against private parties such as the restitutionary remedy envisioned against Notre Dame here. This case was properly dismissed as moot.
In appropriating money for the Department of Education for fiscal year 2000, Congress earmarked $500,000 for a grant to the University of Notre Dame to support a teacher quality initiative. Consolidated Appropriations Act, 2000, Pub. L. No. 106-113, 113 Stat. 1501, 1501A-262 (Nov. 29, 1999). At the Department's request, Notre Dame submitted a grant application to receive the money, indicating that it would be used to fund its Alliance for Catholic Education ("ACE"), a teacher-training program aimed at training and placing teachers in underserved Catholic schools in poor neighborhoods. Notre Dame planned to replicate the ACE program in partnership with four other colleges and universities. The Department of Education awarded Notre Dame the grant.
Joan Laskowski and Daniel Cook, both federal taxpayers who had no connection to the grant, believed the earmark violated the Establishment Clause and sued the Secretary of the Department of Education to enjoin payment. Notre Dame intervened as a defendant. Laskowski and Cook did not seek a preliminary injunction, however, and by the time the district court heard their case, the grant money had already been fully paid to Notre Dame and the one-time-only earmark expired. The district court dismissed the case as moot.
On appeal, the taxpayers conceded that their request for injunctive relief was moot. But they argued that another form of relief was available to save their suit from dismissal: the district court could order the Secretary of Education to seek recoupment of any wrongfully disbursed funds from Notre Dame. This panel unanimously rejected that argument, noting that the court has no authority to order the Secretary to seek recoupment from Notre Dame because an agency's decision not to take an enforcement action is within the discretion of the agency and is not reviewable. See Laskowski, 443 F.3d at 934 (citing Heckler v. Chaney, 470 U.S. 821, 831-33); id. at 940 (Sykes, J., dissenting).
But our panel was divided on whether the entire suit was moot. The majority concluded that it was not because the district court could directly order Notre Dame to pay back any wrongfully disbursed money as restitution to the U.S. Treasury for the government's Establishment Clause violation. Id. at 934-35. This alternative form of relief, the majority concluded, forestalled mootness and permitted the taxpayers' suit to proceed on the merits. Id. at 935-36. The Supreme Court granted certiorari, vacated our judgment, and remanded for reconsideration in light of Hein.
We note at the outset that this case differs from Hein in that the taxpayers here brought an Establishment Clause challenge to a specific congressional earmark, not (as in Hein) a challenge to an Executive Branch program supported by general appropriations. The issue in Hein was whether the taxpayers had standing from the start; the issue here is mootness, a subset of standing doctrine. That doesn't change the analysis. Mootness is "the doctrine of standing set in a time frame: The requisite personal interest that must exist at the commencement of the litigation (standing) must continue throughout its existence (mootness)." Friends of the Earth, Inc. v. Laidlaw Evtl. ...