Justia Government Contracts Opinion Summaries

Plaintiff H.C. Equities, L.P. asserted contract claims against its commercial tenant, the County of Union, after the County began to withhold rent payments in response to a dispute about the condition of the leased commercial buildings. During negotiations to settle the contract matter, the County directed its co-defendant, the Union County Improvement Authority (Authority), to assess the County’s real estate needs. H.C. Equities obtained a copy of a consultant’s report prepared as part of that assessment and objected to statements in the report about the condition of the buildings that it had leased to the County. H.C. Equities filed suit against the County and the Authority, asserting conspiracy claims against both defendants and trade libel and defamation claims against the Authority. Plaintiff did not apply for permission to file a late tort claims notice until more than eight months after the expiration of the one-year period allowed under N.J.S.A. 59:8-9 for the filing of such motions. The trial court held that H.C. Equities had failed to file the notices of claim that the Tort Claims Act required and dismissed its tort claims. H.C. Equities appealed, and the Appellate Division reversed the trial court. Relying on a combination of excerpts from three letters written by H.C. Equities’ counsel, the Appellate Division found that H.C. Equities substantially complied with the Act’s notice of claim provisions. The New Jersey Supreme Court disagreed that a finding of substantial compliance with the Tort Claims Act could be premised on comments made by plaintiff’s counsel in three different letters sent to lawyers representing the defendant public entities. The Supreme Court did not find that H.C. Equities’ letters, individually or collectively, communicated the core information that a claimant had to provide to a public entity in advance of filing a tort claim. The Appellate Division’s determination was reversed, and the matter remanded to the trial court. View "H.C. Equities, LP v. County of Union" on Justia Law

The city of Puyallup (City) hired Conway Construction Company to build a road. The contract allowed the City to terminate the contract early either for its convenience or on Conway’s default, but a termination for convenience would result in more costs for the City. The City ended up terminating the contract partway through construction, claiming Conway defaulted. After a lengthy bench trial, the trial court concluded that Conway was not in default when the City terminated the contract and converted the termination into one for convenience. After review, the Washington Supreme Court affirmed the trial court’s decision. Further, the Court held that the City was not entitled to an offset for any defective work discovered after termination because the City did not provide Conway with the contractually required notice and opportunity to cure. View "Conway Constr. Co. v. City of Puyallup" on Justia Law

AGRED filed suit seeking a declaratory judgment regarding its rights and obligations under a written agreement with the United States. The Corps, acting on behalf of the United States, moved to dismiss for lack of subject matter jurisdiction on the grounds that AGRED lacks standing.The Eighth Circuit affirmed the district court's dismissal of AGRED's declaratory judgment claim based on lack of subject matter jurisdiction and agreed with the district court that AGRED's injury was not caused by the Corps. In this case, AGRED failed to establish a connection between its injury of being enjoined from charging fees for access a lake plaintiff owns and the Corps' conduct. The court explained that there are several kinks in AGRED's causal chain, including that AGRED's injury results directly from FOLEA's thus far successful lawsuit. In this case, there is no real contractual dispute between AGRED and the Corps. Therefore, AGRED fails to meet the causation requirement for standing because it cannot show that its injury is fairly traceable to the Corps. View "Agred Foundation v. U.S. Army Corps of Engineers" on Justia Law

Rite Aid’s “Rx Savings Program” provides generic prescription drugs at reduced prices. The program is free and widely available but excludes customers whose prescriptions are paid by publicly funded healthcare programs like Medicare or Medicaid. Federal regulations require pharmacies to dispense prescriptions for beneficiaries of those programs at their “usual and customary charge to the general public” (U&C rate). Rahimi alleged that Rite Aid overbilled the government programs because the amounts it charged did not take into account the lower Rx Savings Program prices. Rahimi claimed Rite Aid's submission of bills for those covered by publicly funded health insurance, representing the price to be the U&C rate, violated the False Claims Act, 31 U.S.C. 3729(a).The Sixth Circuit affirmed the dismissal of Rahimi’s claim. The Act’s public disclosure bar precludes qui tam actions that merely feed off prior public disclosures of fraud. From the beginning, communications about the Rx Savings Program have stated that publicly funded health care programs were ineligible for the discounted prices. Before Rahimi’s disclosures, Connecticut investigated membership discount prices; the Department of Health and Human Services announced that it would review Medicaid claims for generic drugs to determine the extent to which large chain pharmacies are billing Medicaid the usual and customary charges for drugs provided under their retail discount generic programs; and a qui tam action was unsealed in California, describing an identical scheme. View "Rahimi v. Rite Aid Corp." on Justia Law

The Supreme Court affirmed the order of the West Virginia Public Service Commission ruling that its jurisdiction under state law to regulate a company that was operating in West Virginia solely as a contractor for a federal agency was preempted by federal law, holding that there was no error in the Commission's determination.The United States Department of Veterans Affairs (VA), the federal agency in this case, was impelled to give the company, Community Pastor Care, LLC (CPC), the subject contract to meet a goal expressed by Congress in 38 U.S.C. 8127(a). Metro Tristate, Inc. filed this case asking that the Commission bar CPC from transporting VA passengers until it received a permit from the Commission. The Commission concluded that its jurisdiction to regulate CPC was preempted by federal law. The Supreme Court affirmed, holding that the Commission correctly determined that its jurisdiction to regulate CPC was preempted by federal law. View "Metro Tristate, Inc. v. Public Service Commission of W. Va." on Justia Law

The employee of a subcontractor on a state public works project sued the prime contractor’s surety bond for unpaid labor under Alaska’s Little Miller Act. The trial court ruled the employee failed to give notice to the contractor within the statutorily required 90 days of his last date of labor on the project. The trial court entered a directed verdict against the employee. The employee appealed to the superior court, which denied the appeal, and then petitioned the Alaska Supreme Court for hearing. This case presented two issues of first impression: (1) how to define “labor;” and (2) whether “notice” was effective on the date of mailing or the date of receipt. Under the Little Miller Act, the Supreme Court defined “labor” as work that was “necessary to and forwards” the project secured by the payment bond, and held the effective date of “notice” to be the date notice is sent via registered mail. The superior court judgment denying the employee's appeal was reversed and the matter remanded for further proceedings. View "Dat Luong DBA LVDH Construction v. Western Surety Co." on Justia Law

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

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

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

In 2009, MC-2 was awarded Government Services Administration (GSA) task order to provide services for the annual GovEnergy Conference. MC-2 performed the Task Order in 2009, 2010, and 2011. GSA canceled the 2012 Conference before it began and requested that MC-2 return the entire Reserve Fund and an accounting for the Reserve Fund over the contract's life. MC-2 purportedly responded days later, arguing that GSA never before claimed that it was entitled to the difference between the Conference revenue and expenses, that MC-2 was entitled to any excess revenue, and that MC-2 had submitted a final accounting at the end of each contracting year. In 2012, MC-2 submitted a termination-for-convenience proposal.In November 2015, GSA sent MC-2 a letter providing the Contracting Officer’s final decision on MC-2’s proposal, which had sought $717,680.10, stating that the Government believed that MC-2 owed the government money. The decision stated that “GSA considers the Reserve Fund balance a contract debt. In January 2018, GSA sent a follow-up letter, demanding payment of $660,013.68. Because MC-2 had not appealed the November 2015 Final Decision, GSA deemed MC-2’s debt “final and conclusive,” 41 U.S.C. 7103(g)).In December 2018, MC-2 filed suit, arguing that the 2015 GSA letter was not a final decision because it failed to state a sum certain. The Federal Circuit affirmed the dismissal of the suit as untimely because it was not brought within 12 months of the 2015 decision, as required by 41 U.S.C. 7104(b)(3). GSA issued a valid claim under the Contract Disputes Act for the return of the Reserve Funds; GSA’s claim was the subject of a written decision by the GSA contracting officer; and MC-2 failed to file suit within 12 months of receiving the contracting officer’s final decision View "Creative Management Services, LLC v. United States" on Justia Law