Justia Government Contracts Opinion Summaries

The Township solicited bids for the demolition of former hospital buildings. ICC, a Detroit-based minority-owned company, submitted the lowest bid. AAI, a white-owned business submitted the second-lowest bid, with a difference between the bids of almost $1 million. The Township hired a consulting company (F&V) to vet the bidders and manage the project. F&V conducted interviews with both companies and provided a checklist with comments about both companies to the Township. ICC alleges that F&V made several factual errors about both companies, including that AAI had no contracting violations and that ICC had such violations; that ICC had no relevant experience, that AAI had relevant experience, and that AAI was not on a federal contracting exclusion list. F&V recommended that AAI receive the contract. The Township awarded AAI the contract. ICC filed a complaint, alleging violations of the U.S. Constitution, federal statutes, and Michigan law.The district court dismissed the case, finding that ICC failed to state a claim under either 42 U.S.C. 1981 or 42 U.S.C. 1983 by failing to allege the racial composition of its ownership and lacked standing to assert its constitutional claims and that F&V was not a state actor. The Sixth Circuit reversed in part. ICC had standing to bring its claims, and sufficiently pleaded a section 1981 claim against F&V. The other federal claims were properly dismissed. View "Inner City Contracting LLC v. Charter Township of Northville" on Justia Law

The First Circuit affirmed the judgment of the district court dismissing this lawsuit against the Financial Oversight and Management Board for Puerto Rico (FOMB) and its executive director challenging the FOMB's alleged failure to review a sale agreement on untimeliness grounds, holding that the dismissal was proper, albeit on standing grounds.Appellants - several Puerto Rico corporations and individuals - brought this action claiming that the FOMB's alleged failure to review a $384 million loan sale agreement between the Economic Development Bank for Puerto Rico (BDE) and a private investment company violated their constitutional rights under the Fourteenth Amendment's Due Process and Equal Protection Clauses, and a statutory violation under the Puerto Rico Oversight, Management, and Economic Stability act . The district court granted the FOMB's motion to dismiss, concluding that the claims were time-barred. The First Circuit affirmed but on different grounds, holding that Appellants lacked standing because their complaint failed to allege that the FOMB's inaction caused their claimed injury. View "R&D Master Enterprises, Inc. v. Financial Oversight & Management Bd. for P.R." on Justia Law

The Lemasters run a Lawrence County, Kentucky towing business, which was on the county’s “rotation list” of companies to call when it needed to order a tow. Both as fire chief and in his towing business, Lemaster sparred with Carter, Lawrence County’s “judge-executive,” the elected head of its executive branch. Lemaster criticized Carter on Facebook. Five days later, the 911 Center sent an email to dispatchers; its subject identified Lemaster Towing and the Cherryville Fire Department. Its body stated in all caps: “Per Judge Carter do not tone them out on any fire calls[;] use nearest department[;] . . . Lemaster Towing is no longer on the rotation list[.]”The Lemasters sued Carter and Lawrence County under 42 U.S.C. 1983 and state law, alleging that Carter violated the First Amendment by removing Lemaster Towing from the rotation list in retaliation for Lemaster’s criticisms. The district court granted the defendants summary judgment. The Sixth Circuit affirmed as to the Monell claims against the county; Lemaster did not tie the actions to any county policy. The court reversed as to Carter. Carter conceded that his communications with dispatch employees could constitute an adverse action. The record would allow a rational jury to find that Lemaster’s Facebook post motivated Carter’s decision to remove Lemaster Towing from the rotation list. View "Lemaster v. Lawrence County, Kentucky" on Justia Law

While at a bar at the U.S. Embassy compound in Baghdad, Iraq, Plaintiff was shoved by an intoxicated co-worker. She was reluctant to report the incident, but she eventually acquiesced to requests of the State Department and her employer. Because of her report, Plaintiff’s employer attempted to transfer her to a different position. After initially refusing the transfer, she was fired. Plaintiff filed suit under the Defense Contractor Whistleblower Protection Act (DCWPA). The district court dismissed her complaint without prejudice, allowing leave to amend.   The Ninth Circuit affirmed the district court’s dismissal of Plaintiff’s action under DCWPA against Valiant Integrated Services, LLC, and The Electronic On-Ramp, Inc. The panel held that to survive a motion to dismiss under the DCWPA, a plaintiff must plausibly allege that: (1) she made a disclosure that she reasonably believed was evidence of a violation related to a Department of Defense contract; and (2) her employer discharged, demoted, or otherwise discriminated against her because of that disclosure. The panel held that Plaintiff did not plausibly allege a reasonable belief that her complaint about the shoving incident encompassed one of the acts described in Section 4701(a)(1)(A)-(C). The panel held that, in the context of a defense contract, a violation of law is related to the contract if it is related to the purpose of the contract or affects the services provided by the defense contractor to the Department of Defense. The panel concluded that, under this standard, Plaintiff’s complaint failed to allege a sufficient nexus between the shove and the Department of Defense-Valiant contract. View "SANA KAPPOUTA V. VALIANT INTEGRATED SERVICES, ET AL" on Justia Law

Plaintiff Vermont Human Rights Commission, on behalf of plaintiff Latonia Congress, appealed a trial court’s decision granting summary judgment to defendant Centurion of Vermont LLC on the Commission’s claims of discrimination under the Vermont Public Accommodations Act (VPAA). Congress was incarcerated at a prison owned and operated by the Vermont Department of Corrections (DOC). The DOC contracted with Centurion to provide all medical services for inmates at the prison. Under the previous provider, Congress was seen by an audiologist, who determined that she had substantial bilateral hearing loss, and she was given hearing aids for both ears. In December 2016, Congress reported that the hearing aids were not working, and Centurion planned to send them “to Audiology for check of functioning.” Later in December 2016, a doctor examined Congress’s ears and did not find any indication of an obstruction or other problem that might be affecting her hearing. Congress delivered her hearing aids to the medical unit to be sent out for testing. They were returned to her without having been tested. The record established that no one knew what happened to the hearing aids during that time; they were apparently misplaced. Through 2017 and early 2018, Congress attempted numerous times to obtain functioning hearing aids. Because Congress was deemed “functional” for some period of time despite her reported difficulty in hearing conversations, she was not eligible for hearing aids under Centurion’s policies. Eventually, in March 2018, an audiologist concluded Congress had moderate to severe bilateral hearing loss, which was worse in one ear, and recommended hearing aids. She was provided with one hearing aid in April 2018, which improved her hearing in that ear. Congress was released from prison in October 2019. In March 2020, the Commission filed a complaint against Centurion, the DOC, and other state defendants, alleging, as relevant here, that they discriminated against Congress in violation of the VPAA by failing to provide her with functioning hearing aids and thereby denying her equal access to certain benefits and services offered at the prison. Finding no reversible error in the grant of summary judgment in favor of Centurion, the Vermont Supreme Court affirmed. View "Human Rights Commission v. Vermont, et al." on Justia Law

Cummings, who is deaf and blind, sought physical therapy services from Premier, requesting an American Sign Language interpreter at her sessions. Premier declined. Cummings sought damages, alleging discrimination on the basis of disability under the Rehabilitation Act and the Affordable Care Act. Premier is subject to those statutes because it receives reimbursement through Medicare and Medicaid. The district court determined that the only compensable injuries allegedly caused by Premier were emotional in nature.The Fifth Circuit and Supreme Court affirmed the dismissal of the complaint. Spending Clause legislation, including the statutes at issue, operates based on consent; a particular remedy is available in a private Spending Clause action only if the funding recipient is on notice that, by accepting federal funding, it exposes itself to liability of that nature. Because the statutes at issue are silent as to available remedies, the Court followed the contract analogy. A federal funding recipient is on notice that it is subject to the “usual” remedies traditionally available in breach of contract suits; emotional distress is generally not compensable in contract.The Court rejected an argument that such damages may be awarded where a contractual breach is particularly likely to result in emotional disturbance. Even if it were appropriate to treat funding recipients as aware that they may be subject to rare contract-law rules, they would lack the requisite notice that emotional distress damages are available under these statutes. There is no majority rule on what circumstances may trigger the allowance of such damages. View "Cummings v. Premier Rehab Keller, P.L.L.C." on Justia Law

Miller, an assistant city attorney, advised the City of Eugene not to renew contracts with DePaul, a qualified nonprofit agency for individuals with disabilities (QRF) under an Oregon law that requires cities to contract with QRFs in certain circumstances. DePaul sued under 42 U.S.C. 1983, alleging that it held a clearly established constitutionally protected property interest in two 12-month security-service contracts. In 2016, Eugene had decided to modify its security services by requiring that the security service employees be armed and decided not to renew the contracts.The Ninth Circuit reversed the district court and held that Miller was entitled to qualified immunity. No court has considered DePaul’s novel argument that the Oregon QRF statute created a protected property interest in city contracts. Nor does the QRF statute on its face definitively resolve that question. DePaul did not provide any precedent addressing Oregon’s QRF statute or anything closely related. There was no precedent clear enough that every reasonable official would interpret the QRF statute as creating a protected property interest in DePaul’s annual contracts. There was also no precedent considering whether the QRF statute allows the city to end a contract if it seeks new services, such as armed security. View "DePaul Industries v. Miller" on Justia Law

Fisk, an LLC formed in 2018, had two members; one is an attorney. Fisk collaborated with the City of DeKalb regarding the redevelopment of a dilapidated property. Under a Development Incentive Agreement, if Fisk met certain contingencies, DeKalb would provide $2,500,000 in Tax Increment Financing. In 2019, Nicklas became the City Manager and opened new inquiries into Fisk’s financial affairs and development plans. Nicklas concluded Fisk did not have the necessary financial capacity or experience, based on specified factors.Fisk's Attorney Member had represented a client in a 2017 state court lawsuit in which Nicklas was a witness. Nicklas considered funding incentives for other development projects with which, Fisk alleged, Nicklas had previous financial and personal ties.The City Council found Fisk’s financial documents “barren of any assurance that the LLC could afford ongoing preliminary planning and engineering fees,” cited “insufficient project details,” and terminated the agreement. Fisk sued Nicklas under 42 U.S.C. 1983, alleging Nicklas sought to retaliate against Fisk and favor other developers. The Seventh Circuit affirmed the dismissal of the claims. Fisk did not exercise its First Amendment petition right in the 2017 lawsuit. That right ran to the client; Fisk did not yet exist. Fisk had no constitutionally protected property right in the agreement or in the city’s resolution, which did not bind or “substantively limit[]” the city “by mandating a particular result when certain clearly stated criteria are met.” Nicklas had a rational basis for blocking the project, so an Equal Protection claim failed. View "145 Fisk, LLC v. Nicklas" on Justia Law

The Randolph-Sheppard Act, 20 U.S.C. 107, requires government agencies to set aside certain contracts for sight-challenged vendors. States license the vendors and match them with available contracts. In 2010, Michigan denied Armstrong’s bid for a contract to stock vending machines at highway rest stops. A state ALJ ruled in Armstrong’s favor and recommended that she get priority for the next available facility/location. The state awarded Armstrong an available vending route later that year. Armstrong nonetheless requested federal arbitration, seeking nearly $250,000 in damages to account for delays in getting the license. The arbitrators ruled that Armstrong was wrongfully denied the location she sought and ordered Michigan to immediately assign Armstrong the Grayling vending route but declined to award damages, reasoning that her request was “too speculative.”The district court upheld the arbitration award and rejected Armstrong’s 42 U.S.C. 1983 claims, concluding that the Randolph-Sheppard Act created the sole statutory right to relief under federal law. Michigan subsequently granted her the Grayling license. The Sixth Circuit affirmed. The unfavorable arbitration decision was not arbitrary or capricious under the Administrative Procedure Act. Armstrong may not sue under 42 U.S.C. 1983 to vindicate her rights under the Randolph-Sheppard Act. View "Armstrong v. Michigan Bureau of Services for Blind Persons" on Justia Law

Rushton, an Illinois Times journalist, requested from the Illinois Department of Corrections (DOC) settlement agreements pertaining to claims filed in connection with the death of Franco, a former Taylorville inmate who died from cancer, including agreements involving Wexford, which contracts with DOC to provide medical for inmates. The DOC did not have a copy of the Wexford agreement. Wexford claimed that it was “confidential” and not a public record for purposes of the Freedom of Information Act (FOIA). Wexford provided the DOC’s FOIA officer with a redacted version, which the DOC gave to Rushton. Rushton and the Times filed suit. The court allowed Wexford to intervene and ordered Wexford to provide an unredacted version of the agreement to the court under seal. Wexford argued that the agreement did not “directly relate” to the governmental function that it performs for the DOC because it memorializes its independent business decision to settle a legal claim, without mentioning Franco’s medical condition or medical care. The plaintiffs characterized the agreement as "settlement of a claim that Wexford failed to perform its governmental function properly" and argued that the amount of the settlement affected taxpayers.The Illinois Supreme Court held that the agreement is subject to FOIA. The statute is to be construed broadly in favor of disclosure. The contractor stood in the shoes of the DOC when it provided medical care to inmates. The settlement agreement was related to the provision of medical care to inmates, and public bodies may not avoid disclosure obligations by delegating their governmental function to a third party. View "Rushton v. Department of Corrections" on Justia Law