Justia Government Contracts Opinion Summaries

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The Supreme Court reversed the decision of the court of appeals reversing the judgment of the district court granting the City of Topeka's motion to dismiss this breach of contract suit, holding that dismissal was proper.The City entered into an agreement with Plaintiffs, private owners, to assume full ownership of a motor speedway. The rights to the speedway were to be paid through sales tax and revenue (STAR) bonds. When the City decided not to fulfill the agreement Plaintiffs brought this action claiming that the City breached the parties' contract. The district court granted the City's motion to dismiss, concluding that the agreement was an exercise of a governmental or legislative function and binding on successive City Councils. The court of appeals reversed, concluding that the government act was proprietary. The Supreme Court reversed, holding that the City Council's decision to enter into the contract and move forward on issuing STAR bonds was a governmental decision, and the newly elected City Council was under no obligation to carry out the policies of its predecessor. View "Jayhawk Racing Properties v. City of Topeka" on Justia Law

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The Supreme Court reversed in part and affirmed in part the judgment of the court of appeals denying a writ of mandamus sought by Steven Armatas, holding that Armatas was entitled to a writ of mandamus but that the court of appeals correctly denied attorneys fees.Armatas sought a writ of mandamus to order Plain Township Board of Trustees to produce an invoice for legal services performed on the township's behalf. The township declined to produce the invoice, arguing that it did not possess the invoice and had no duty to provide it. The court of appeals denied the writ, along with Armatas's related claims for statutory damages, attorney fees, and court costs, concluding that the requested records were not public records. The Supreme Court reversed in part, holding (1) Armatas was entitled to a writ of mandamus under the quasi-agency test; (2) Armatas was entitled to statutory damages and an award of court costs; and (3) Armatas was not entitled to attorney fees. View "State ex rel. Armatas v. Plain Township Board of Trustees" on Justia Law

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Built Pacific, Inc. (BPI) appealed a judgment entered against it and in favor of the California Department of Industrial Relations, Division of Labor Standards Enforcement (DLSE). The DLSE issued a Civil Wage Penalty Assessment (CWPA) against BPI for labor law violations on a public works project. BPI entered into a settlement agreement with the DLSE but failed to timely pay the settlement amount. As a result, BPI was not released from liability, the DLSE sought judgment based on the final CWPA, and the superior court entered judgment on the CWPA pursuant to Labor Code section 1742 (d). BPI appealed, arguing that the judgment was based on an unreasonable and unenforceable liquidated damages clause of the settlement agreement under Civil Code section 1671 (b), and should be reversed. The Court of Appeal concluded Civil Code section 1671 did not apply because judgment was entered pursuant to the Labor Code and not a “contract.” Even if section 1671 were to apply, the Court concluded the disputed provision in the settlement agreement was both reasonable and enforceable. View "Department of Industrial Relations, etc. v. Built Pacific, Inc." on Justia Law

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In 2010, Felten filed a qui tam complaint alleging that his then-employer, Beaumont Hospital, was violating the False Claims Act (FCA), 31 U.S.C. 3730(h), and the Michigan Medicaid False Claims Act by paying kickbacks to physicians and physicians’ groups in exchange for referrals of Medicare, Medicaid, and TRICARE patients. Felten also alleged that Beaumont had retaliated against him by threatening and “marginaliz[ing]” him for insisting on compliance with the law. After the government intervened and settled the case against Beaumont, the district court dismissed the remaining claims, except those for retaliation and attorneys’ fees and costs.Felten amended his complaint to add allegations of retaliation that took place after he filed his initial complaint: he was terminated after Beaumont falsely represented to him that an internal report suggested that he be replaced and that his position was subject to mandatory retirement. Felten further alleged that he had been unable to obtain a comparable position in academic medicine because Beaumont “intentionally maligned [him].”The district court dismissed the allegations of retaliatory conduct occurring after Felten’s termination. The Sixth Circuit vacated. The FCA’s anti-retaliation provision protects a relator from a defendant’s retaliation after the relator’s termination. View "Felten v. William Beaumont Hospital" on Justia Law

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A project developer that used state-allocated federal tax credits for a low-income housing project sued the state housing authority, asserting an option to eliminate a contractual obligation to maintain the project as low-income housing for 15 years beyond the initial 15-year qualifying period. The superior court granted summary judgment in favor of the housing authority, and the developer appealed several aspects of the court’s ruling. After review of the superior court record, the Alaska Supreme Court concluded that court correctly interpreted the relevant statutes and contract documents, and correctly determined there were no material disputed facts about the formation of the parties’ agreements. View "Creekside Limited Partnership, et al. v. Alaska Housing Finance Corporation" on Justia Law

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The City of Biloxi (City), the Secretary of State on behalf of the State of Mississippi (State), and the Board of Trustees of the State Institutes of Higher Learning (IHL) settled an ownership dispute over coastal property leased to a casino, and agreed how to divide the annual casino rent. Seventeen years later, the City asked the chancery court to declare that it could adjust for inflation its base amount of rent received before divvying up its rent with the State and the IHL. But the City’s only support of its new inflation-adjustment claim was the three public entities’ lease with the casino. While the casino lease required the minimum amount of rent owed be adjusted for inflation every five years, the casino lease did not govern how the City, the State, and the IHL were to divide the rent. Instead, the manner in which rent was divided is governed solely by the settlement agreement. And the settlement agreement was silent with respect to an inflation adjustment. The Mississippi Supreme Court found, however, the agreement was clear: the City received a specific sum, and any rent in excess of that exact amount had to be shared with the State and the IHL. View "In the Matter of The Stewardship of the Public Trust Tidelands" on Justia Law

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In 2008, severe storms hit Indiana. Columbus Hospital sustained significant damage. President Bush authorized FEMA assistance through disaster grants under the Stafford Act, 42 U.S.C. 5121–5206. The state agreed to be the grantee for all grant assistance, with the exception of assistance to individuals and households. FEMA reserved the right to recover assistance funds if they were spent inappropriately or distributed through error, misrepresentation, or fraud. Columbus apparently submitted its request directly to FEMA, instead of through the state. FEMA approved Columbus projects, totaling approximately $94 million. Funds were transmitted to Columbus through the state. In 2013, the DHS Inspector General issued an audit report finding that Columbus had committed procurement violations and recommended that FEMA recover $10.9 million. FEMA reduced that amount to $9,612,831.19 and denied Columbus’s appeal. Columbus did not seek judicial review. FEMA recovered the disputed costs from Columbus in 2014.In 2018, Columbus filed suit, alleging four counts of contract breach and illegal exaction. The Claims Court dismissed Columbus’s illegal exaction claim, holding that Columbus did not have a property interest in the disputed funds and that FEMA’s appeal process protected Columbus’s rights to due process, and dismissed Columbus’s contract-based claims, finding that Columbus had no rights against FEMA under that contract or otherwise. The Seventh Circuit affirmed the dismissal of the illegal exaction and express and implied contract claims. The court vacated the dismissal of the third-party beneficiary contract claim. View "Columbus Regional Hospital v. United States" on Justia Law

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In 2009, Meidinger submitted whistleblower information to the IRS under 26 U.S.C. 7623, concerning “one million taxpayers in the healthcare industry that are involved in a kickback scheme.” The IRS acknowledged receipt of the information, but did not take action against the accused persons. The IRS notified Meidinger of that determination. Meidinger argued that the IRS created a contract when it confirmed receipt of his Form 211 Application, obligating it to investigate and to pay the statutory award. The Tax Court held that it lacked the authority to order the IRS to act and granted the IRS summary judgment. The D.C. Circuit affirmed that Meidinger was not eligible for a whistleblower award because the information did not result in initiation of an administrative or judicial action or collection of tax proceeds.In 2018, Meidinger filed another Form 211, with the same information as his previous submission. The IRS acknowledged receipt, but advised Meidinger that the information was “speculative” and “did not provide specific or credible information regarding tax underpayments or violations of internal revenue laws.” The Tax Court dismissed his suit for failure to state a claim; the D.C. Circuit affirmed, stating that a breach of contract claim against the IRS is properly filed in the Claims Court under the Tucker Act: 28 U.S.C. 1491(a)(1). The Federal Circuit affirmed the Claims Court’s dismissal, agreeing that the submission of information did not create a contract. View "Meidinger v. United States" on Justia Law

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In 2010, the Army granted Authentic a nonexclusive license to manufacture and sell clothing bearing the Army’s trademarks. The agreement required the Army’s advance written approval of any products and marketing materials bearing the Army’s trademarks and included exculpatory clauses that exempted the Army from liability for exercising its discretion to deny approval. In 2011-2014, Authentic submitted nearly 500 requests for approval; the Army disapproved 41 submissions. During that time, Authentic received several formal notices of material breach for claimed failures to timely submit royalty reports and pay royalties. Authentic eventually paid its royalties through 2013. Authentic’s counsel indicated that Authentic would not pay outstanding royalties for 2014.Authentic's ensuing breach of contract suit cited the Army’s denial of the right to exploit the goodwill associated with the Army’s trademarks, refusal to permit Authentic to advertise its contribution to Army recreation programs, delay of approval for a financing agreement, denial of approval for advertising, and breach of the implied duty of good faith and fair dealing by not approving the sale of certain garments. The Federal Circuit affirmed summary judgment in favor of the government. The license agreement stated in no uncertain terms that the Army had “sole and absolute discretion” regarding approval of Authentic’s proposed products and marketing materials; the exercise of that broad approval discretion is not inconsistent with principles of trademark law. View "Authentic Apparel Geoup, LLC v. United States" on Justia Law

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In 2017, the Department of Homeland Security issued the Solicitation as a Request for Proposal for a potentially multi-year contract for dorm management services at the Federal Law Enforcement Training Center in Glynco, Georgia. During the evaluation process, the government eliminated Safeguard’s proposal from consideration because Safeguard omitted pricing information for 16 contract line item numbers totaling $6,121,228.The Claims Court and Federal Circuit upheld the award to another bidder. The Solicitation required offerors to submit the pricing information and provided notice that elimination was possible if that pricing information was omitted. Safeguard’s omissions were material and not subject to waiver or clarification. The court upheld the denial of Safeguard’s email request to supplement the administrative record through discovery and the denial of its motion to supplement the administrative record with affidavits. The Claims Court had jurisdiction over a claim that the government breached an implied-in-fact contract to fairly and honestly consider an offeror’s proposal in the procurement context under 28 U.S.C. 1491(b)(1). View "Safeguard Base Operations, LLC v. United States" on Justia Law