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The Orange County Water District (the District) appealed a postjudgment order awarding The Arnold Engineering Company approximately $615,000 in costs of proof under Code of Civil Procedure section 2033.420 based on the District's failure to admit certain fact-specific requests for admission (RFAs) during discovery. The District argued the trial court erred in making the award because: (1) the District had reasonable grounds to believe it would prevail on the matters at issue under section 2033.420 (b)(3); and (2) even if it did not, Arnold did not adequately substantiate its costs with admissible evidence. After review, the Court of Appeal concluded the trial court abused its discretion in awarding costs for certain RFAs because the District reasonably relied on percipient witness testimony, undisputed scientific testing, and the opinions of a qualified expert in denying the RFAs. Furthermore, the Court determined certain evidence, namely expert witness invoices, was inadequate to support an award under the circumstances here because it did not distinguish between recoverable and nonrecoverable costs. The case was remanded for a new order awarding reasonable costs of proof. View "Orange County Water Dist. v. The Arnold Engineering Co." on Justia Law

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During World War II, the Hanford Nuclear Reservation was established by the U.S. Army Corps of Engineers. After the war, Hanford continued in use, operated by contractors. Each time the work was transferred to another contractor, the employees that performed the work would stay the same, typically with the same pay and benefits. The Hanford Multi-Employer Pension Plan (MEPP) was established in 1987 as a contract between “Employers,” defined as named contractors, and “Employees.” The government is not a party to the MEPP but may not be amended without government approval. In 1996, some employees accepted employment with a Hanford subcontractor, Lockheed, and were informed that, upon their retirement, they would not receive retirement benefits that were previously afforded under the MEPP. They were subsequently told that they would remain in the MEPP but that, instead of calculating their pension benefits based on their total years in service, their benefits would be calculated using the highest five-year salary, and that they could not challenge the change until they retired. This became a MEPP amendment. In 2016, former Lockheed employees sued the government, alleging that an implied contract was breached when they did not receive benefits based on their total years in service. The Federal Circuit held that the former employees did not prove that an implied-in-fact contract existed. The government funds Lockheed and others to manage Hanford, but there is no evidence that the government intended to be contractually obligated to their employees; there was no mutuality of intent. View "Turping v. United States" on Justia Law

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Maynard, Cooper & Gale, P.C. ("MCG"), petitioned the Alabama Supreme Court for a writ of mandamus to direct the Jefferson Circuit Court to vacate its July 30, 2018 order denying MCG's motion for a change of venue and to enter an order transferring the underlying action to the Madison Circuit Court on the basis of the doctrine of forum non conveniens. In late 2017, AAL USA, Inc. ("AAL"), a Delaware corporation doing business in Alabama, and Oleg Sirbu, a resident of Dubai, United Arab Emirates (collectively, "the plaintiffs"), sued MCG, asserting a claim of legal malpractice pursuant to the Alabama Legal Services Liability Act ("the ALSLA"), and seeking, among other relief, disgorgement of all attorney fees paid by the plaintiffs to MCG. AAL maintained, repaired, and overhauled helicopters through various government contracts or subcontracts on United States military bases. MCG represented the plaintiffs from 2014 through October 28, 2016; two MCG attorneys, Jon Levin and J. Andrew Watson III, were shareholders of MCG whose allegedly wrongful conduct was performed within the line and scope of their employment with MCG. The events giving rise to this litigation began in September 2016, when AAL received a "base-debarment" letter notifying it that it no longer had access to certain military bases outside the continental United States. MCG chief financial officer Keith Woolford forwarded this letter to MCG, and, according to the plaintiffs, MCG "immediately embarked in a central role in [MCG CEO Paul] Daigle's and Woolford's scheme to steal the assets of AAL." The complaint alleged that Levin worked closely with Woolford and Daigle to draft the APA pursuant to which Black Hall Aerospace, Inc., Daigle, and Woolford would purchase all of AAL's assets, as a way to cure the base-debarment problem. The plaintiffs alleged that MCG knew that the APA would "gut" the plaintiffs –- its current clients –- while simultaneously benefiting Daigle, Woolford, and BHA –- other clients of MCG -- and that this "clear and irreconcilable conflict of interest ... was never disclosed to [the plaintiffs]." The Alabama Supreme Court concluded MCG carried its burden of showing that Madison County's connection to the action was strong and that Jefferson County's connection to the action was weak. Thus, the circuit court exceeded its discretion in refusing to transfer the case to the Madison Circuit Court in the interest of justice. MCG's petition for a writ of mandamus was granted. View "Ex parte Maynard, Cooper & Gale, P.C." on Justia Law

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The Second Circuit affirmed the district court's summary judgment dismissal of all claims in the Second Amended Complaint against defendants in an action stemming from construction projects with the U.S. Army Corps of Engineers. The court held that MES's claims failed to articulate any support for its accusations that Safeco breached its contractual obligations or engaged in bad faith or tortious conduct. The court noted that the claim that Safeco acted inappropriately by attending the cure meetings was particularly frivolous. In this case, MES failed to identify any good faith basis, in law or on the basis of the agreements at issue, for its assertion that Safeco had no right to take steps to meet its obligations under the surety bonds. The court sua sponte awarded Safeco double costs. View "M.E.S., Inc. v. Safeco Insurance Co. of America" on Justia Law

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The Vermont Agency of Transportation (VTrans) appealed the Transportation Board’s order granting judgment to W.M. Schultz Construction, Inc. in this contract dispute. Schultz entered into a contract with VTrans in December 2013 to replace four bridges destroyed by Tropical Storm Irene. Three bridges were completed without incident. This dispute centered on the fourth bridge, referred to as “Bridge #19.” The Bridge #19 project involved the construction of a single-span steel-girder bridge over the White River in Rochester, Vermont. The west abutment was to be placed on a deep pile foundation and the east abutment (Abutment #2) was to be placed on ledge. The work was to begin in April 2014 and be completed in a single construction season. The Board concluded that Schultz encountered “differing site conditions” in carrying out its bridge-construction project and that it was entitled to an equitable adjustment for costs it incurred as a result. VTrans appealed, arguing the Board misread the contract materials and otherwise erred in granting judgment to Schultz. Finding no reversible error, the Vermont Supreme Court affirmed. View "W.M. Schultz Construction, Inc. v. Vermont Agency of Transportation" on Justia Law

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JRI contracted with the City of Los Angeles Department of Airports (LAWA), to provide LAWA specialized airport firefighting trucks. Each sued the other for breach of the contract. LAWA further alleged JRI violated the California False Claims Act (CFCA), Government Code section 12650, asserting that when JRI submitted it[s] invoices for progress payments and final payments, JRI knew that it was not in compliance with the contract and sought to defraud the government entity LAWA into making payments and that JRI fraudulently induced LAWA to enter into the contract. LAWA was awarded $1 in contract damages. LAWA’s CFCA claim was rejected by the jury, as were JRI’s claims against LAWA. The court awarded LAWA costs as a prevailing party on the contract claims but awarded JRI attorney fees on the CFCA claim, finding the claim frivolous and harassing. The court of appeal affirmed JRI “prevail[ed] in the action” under the relevant CFCA fee provision (section 12652(g)(9)(B);) regardless of its failure to prevail in the action as a whole. View "John Russo Industrial Sheetmetal, Inc. v. City of Los Angeles Department of Airports" on Justia Law

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K-Con and the Army entered into two contracts for pre-engineered metal buildings. K-Con claims that the Army subsequently delayed issuance of a notice to proceed for two years, resulting in $116,336.56 in increases in costs and labor. According to K-Con, this delay was due solely to the government’s decision to add to each contract the performance and payment bonds set forth in Federal Acquisition Regulation (FAR) 52.228-15. The Armed Services Board of Contract Appeals held that bonding requirements were included in the contracts by operation of law when they were awarded, pursuant to the Christian doctrine. The Federal Circuit affirmed. The two contracts are construction contracts and, under the Christian doctrine, the standard bond requirements in construction contracts were incorporated into K-Con’s contracts by operation of law. If the contracts had been issued using the standard construction contract form, there would have been no issue, but these contracts issued using the standard commercial items contract form. There were, however, many indications that the contracts were for construction, not commercial items. The statement of work included many construction-related tasks, including developing and submitting construction plans, obtaining construction permits, and cleaning up construction areas. The statement of work also required compliance with FAR regulations relevant only to construction contracts. View "K-Con, Inc. v. Secretary of the Army" on Justia Law

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Killian Construction Company ("Killian") and Christian Mills petitioned the Alabama Supreme Court for a writ of mandamus to direct the Circuit Court to vacate its order denying their motion to dismiss the underlying action and to enter an order dismissing the action, based on improper venue. The City of Foley, Alabama, contracted with Killian to construct the Foley Sports Tourism Complex ("the sports complex"). Killian was a Missouri corporation whose principal place of business was located in Springfield, Missouri. Killian entered into a subcontract for part of the work on the sports complex with Edward Woerner, owner of Southern Turf Nurseries, Inc. Woerner was a resident of Baldwin County, Alabama. Woerner claimed Killian failed to pay him the full amount due for the work performed under the subcontract and sued Killian at the Baldwin County Circuit Court. The Alabama Supreme Court determined a forum-selection clause in the subcontract obligated the parties to litigate in a federal or state court in Missouri. Woerner did not establish that venue in Missouri would have been seriously inconvenient for the trial of the underlying action. Mills could enforce an outbound forum-selection clause because he was an employee of Killian directly involved in the sports complex project and the claims against him were related to the contract claims against Killian. Therefore, the Supreme Court found Killian and Mills were entitled to the writ of mandamus and granted relief. View "Ex parte Killian Construction Company and Christian Mills." on Justia Law

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John Morgan submitted a public records request to the Mississippi State Hospital (“MSH”) after it had awarded a contract for insurance plan administration to XLK International, LLC (XLK). Morgan, whose bid for the insurance plan administration contract had been unsuccessful, demanded access to all documents XLK had submitted in response to the state hospital’s request for proposal (RFP). XLK sought and obtained a protective order from the chancery court. The chancery court allowed Morgan to intervene and held a hearing on his Motion to Set Aside Protective Order. The chancery court ruled that the documents XLK had submitted in response to MSH’s RFP were not subject to disclosure under the Mississippi Public Records Act, with the exception of the contract between MSH and XLK. Because the chancery court correctly applied the Mississippi Public Records Act, the Mississippi Supreme Court affirmed its judgment. View "Morgan v. XLK International, LLC" on Justia Law

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At issue in this case was the relative priority of statutes and regulations governing the procurement process for the Department of Veterans Affairs (VA). The Federal Circuit affirmed the decision of the United States Court of Federal Claims concluding that section 502 of the Veterans Benefits, Health Care, and Information Technology Act of 2006, Pub. L. No. 109-461, 120 Stat. 30403, 3431-35 (VBA), requires the VA to consider awarding contracts for prescription eyewear based on competition restricted to veteran-owned small businesses before procuring this eyewear from any other source, including any nonprofit agency for the blind or significantly disabled designated as such under that Javits-Wagner-O’Day Act, 41 U.S.C. 8504. After considering the plain language of the VBA, as well as the legislative history and Congress’s intention in enacting it, the Federal Circuit held (1) the Claims Court properly exercised subject-matter jurisdiction over this action; and (2) the Claims Court did not err in its substantive legal analysis, and the VA is required to undertake the “rule of two” analysis as required under the VBA - even when goods and services are on the list. View "PDS Consultants, Inc. v. United States" on Justia Law