Key Points

  • The D.C. Circuit held that Alstom had Article III standing to challenge the FRA's Buy America waiver because the $3 billion in federal funding created predictable economic incentives that traced Alstom's lost-profits injury to the waiver.
  • The court found that the waiver provision's present-tense language requires the FRA to assess whether goods are currently produced domestically, not whether they could be produced in the future.
  • The FRA's waiver was neither contrary to law nor arbitrary because the agency reasonably found no domestic manufacturer produced high-speed trainsets meeting Brightline's 186 mph requirement.
  • Judge Walker dissented on standing, arguing Brightline had other options besides switching to Alstom that would preserve its federal funding.
  • The court reached the merits without remand due to full briefing, the legal nature of the issues, and the need for certainty in the $12 billion infrastructure project.

The D.C. Circuit ruled Friday that Alstom Transportation Inc. has standing to challenge the Federal Railroad Administration's decision to waive Buy America requirements for the Brightline West high-speed rail project, but the court affirmed the waiver on the merits, handing Alstom a procedural victory that produced no practical relief.

Writing for a divided panel, Judge Katsas held that the company's lost-profits claim satisfied Article III's injury, causation, and redressability requirements because the $3 billion in federal funding at stake created predictable economic incentives. "We hold that Alstom has standing to do so, but its claims fail on the merits," Judge Katsas wrote.

Judge Walker dissented in part, arguing that Alstom had failed to show it was "sufficiently predictable" that Brightline would switch train suppliers if the court vacated the waiver. Judge Garcia joined the majority.

The case arose from the FRA's May 2024 decision to grant Brightline West a nonavailability waiver under 49 U.S.C. § 22905, which requires federally funded rail projects to use American-made steel, iron, and manufactured goods unless the agency determines such goods are unavailable domestically in sufficient quantity or quality.

Brightline West, which is building a high-speed passenger rail line between Rancho Cucamonga, California, and Las Vegas, had sought bids for ten trains capable of exceeding 186 miles per hour. Only two companies submitted proposals: Siemens Mobility Inc., offering its Velaro Novo trains already operating in Europe at speeds up to 220 mph, and Alstom, proposing a modified version of its Avelia Liberty trains that currently reach 160 mph on the Northeast Corridor's Acela service.

The FRA found that "there are currently no domestic manufacturers of high-speed trainsets" able to meet Brightline's speed requirements and granted a waiver allowing Siemens to build the first two trains in Germany while training American workers, with the remaining eight trains to be manufactured at a new Nevada facility.

Brightline had identified Siemens as its "preferred bidder" before the final waiver issued, but it did not sign a contract until one week after the FRA's decision. Alstom sued approximately six weeks later, and the district court dismissed the case for lack of Article III standing in December 2025.

The D.C. Circuit reversed on standing. Judge Katsas reasoned that the $3 billion funding condition created the necessary causal chain: without the waiver, Brightline could not have chosen Siemens without forfeiting all federal funding, and vacating the waiver would put Brightline "to a stark choice: Shift business from Siemens to Alstom or else lose $3 billion in federal funding."

The court rejected arguments from Brightline and Siemens that the existing contract between them undermined redressability. "The contract appears in neither the administrative nor the district-court record, and neither Brightline nor Siemens has told us anything about its terms," Judge Katsas wrote. He added that Brightline's projected $750 million cost for all trains was "a fraction of the $3 billion in federal funding" at risk, so contractual liability to Siemens would not likely drive Brightline's future purchasing decision.

Judge Walker disagreed. In his partial dissent, he argued that Alstom presented "a false dichotomy" by assuming Brightline's only options were to switch to Alstom or lose federal funding. "Brightline might instead stick with Siemens and keep the federal funding — perhaps by making Siemens build all ten trains domestically, perhaps by purchasing only the eight trains Siemens already planned to build domestically, or perhaps by obtaining a public-interest waiver allowing Siemens to stick with its original plan," he wrote.

Judge Walker pointed to three facts suggesting a Brightline-Alstom relationship was "pretty far-fetched": Siemens had already built and deployed trains meeting Brightline's speed requirements while Alstom had not, Brightline selected Siemens before the final waiver issued, and Brightline and Siemens had already formed a contract before Alstom sued.

Having found standing, the majority declined to remand and instead reached the merits, citing the parties' full briefing, the legal nature of the issues, the likelihood of appeal from any district court decision, and the need for certainty in a $12 billion infrastructure project. "Two years into this $12 billion infrastructure project, it is better for everyone to know sooner, rather than later, the basic rules governing the $3 billion in federal funding," Judge Katsas wrote.

On the merits, Alstom argued that the waiver provision required the FRA to consider whether domestic manufacturers could produce compliant trains in the future, not just whether they existed at the time of the decision. The statute permits a waiver if goods "are not produced" domestically in sufficient amount or quality.

Judge Katsas rejected this reading based on verb tense. "Congress chose the present tense to frame a question whether the relevant goods 'are' produced domestically at the time of the waiver decision," he wrote. Alstom had invoked the presumption of consistent usage, noting that the underlying Buy America requirement uses "are produced" to refer to future production of goods. But Judge Katsas found that "different grammatical structures indicate different temporal frames of reference" in the two provisions.

In the Buy America requirement, the participle "produced" functions adjectivally to modify "goods," making it "tenseless" and dependent on context. But in the waiver provision, "produced" operates as part of a "verbal passive" describing the act of manufacturing goods, carrying with it the present tense. "So, nothing about the Buy America requirement supports an atextual reading of 'are … produced' in the waiver provision to mean 'will be … produced,'" Judge Katsas concluded.

Alstom also argued the FRA defined the relevant goods too narrowly by distinguishing high-speed trainsets based on speed capabilities. The court acknowledged that "at some point, distinguishing goods based on immaterial technological or other differences might be arbitrary," but found the agency's decision rested on the uncontested fact that no domestic manufacturer could build trains reaching 186 mph.

The court likewise rejected Alstom's claim that the waiver was arbitrary and capricious. The FRA had explained that high-speed trainsets "are highly specialized and require highly skilled labor and specific equipment, manufacturing, testing, and commissioning facilities to ensure safe and efficient operations." The agency could reasonably allow Brightline to work with a company that had already produced trains "proven to travel safely at such high speeds, rather than hope a different company would manage to upgrade its existing technology."

The FRA also stressed that the waiver was "narrowly tailored and limited" to two trains and certain components that all parties agreed were unavailable domestically. "That was more than enough to avoid arbitrary decision-making," Judge Katsas wrote.

The court converted the district court's jurisdictional dismissal into a merits-based judgment and affirmed as modified. Vincent Levy represented Alstom, and Gabriel I. Schonfeld of the U.S. Department of Justice represented the government.

Vincent Levy argued for Alstom. Gabriel I. Schonfeld argued for the FRA. Alice E. Loughran argued for intervenor DesertXpress Enterprises LLC, and Andrew D. Prins argued for intervenor Siemens Mobility Inc.