Justia Government Contracts Opinion Summaries

In 1983, Congress enacted the Nuclear Waste Policy Act, 42 U.S.C. 10101–10270, to provide for government collection and disposal of spent nuclear fuel and high-level radioactive waste. The NWPA authorized the Department of Energy to contract for disposal. In return for payment of fees into the Nuclear Waste Fund, the Standard Contract provided that the DOE would begin to dispose of SNF and HLW not later than January 31, 1998. Because collection and disposal did not begin, courts held that the DOE had breached the Standard Contract with the nuclear energy industry. The trial court found breach of plaintiff's contract, but granted summary judgment in favor of the government regarding the implied covenant of good faith and fair dealing and set damages for the breach at $10,014,114 plus the cost of borrowed funds for financing construction of a dry fuel storage project. On reconsideration, the trial court reduced damages to $9,735,634 and denied the cost of borrowed funds. The Federal Circuit affirmed with respect to borrowed fund, but and reversed denial of overhead costs. View "System Fuels, Inc. v. United States" on Justia Law

Two laws were challenged under the Buy American Act, 41 U.S.C. 8301, which requires that only materials mined, produced, or manufactured in the U.S. be employed for "public use" or used in construction, alteration, or repair of "any public building or public work. A 1985 Puerto Rican law required that local construction projects financed with federal or Commonwealth funds use only construction materials manufactured in Puerto Rico, with limited exceptions relating to price, quality, and available quantity, P.R. Laws Ann. tit. 3, 927-927h (Law 109). Cement is deemed "manufactured in Puerto Rico" only if composed entirely of raw materials from Puerto Rico. P.R. Laws Ann. tit. 10, 167e (Law 132), enacted in 2001, imposes labeling requirements on cement and required that foreign-manufactured cement carry a special label warning against its use in government-financed construction projects unless one of the exceptions contained in the BAA and Law 109 applies. The district court held that the local laws were preempted. The First Circuit upheld Law 109 as a permissible action taken by Puerto Rico as a market participant, but invalidated provisions of Law 132 that discriminate against sellers of foreign cement, leaving the remainder of the law intact. View "Antilles Cement Corp. v. Fortuno" on Justia Law

Defendant, former commissioner in charge of the Environmental Services Department of Jefferson County, was convicted of charges related to federal-funds bribery for accepting cash from an engineering firm that contracted with the county for a sewer reconstruction project. Defendant subsequently appealed, challenging the sufficiency of the evidence supporting his convictions and the reasonableness of his prison term. The court held that the same evidence that supported defendant's federal-funds bribery convictions supported his conspiracy conviction. The court also held that defendant's sentence was procedurally and substantively reasonable. Accordingly, the judgment was affirmed. View "United States v. White" on Justia Law

A child was seriously injured when she was hit in the head by an object thrown by a lawnmower being operated at the federal building adjoining her childcare center. Separate entities provided child care and lawn maintenance, under contract with the federal government. The district court dismissed a suit under the Federal Tort Claims Act, 28 U.S.C. 1346(b), 2671-2680. The First Circuit affirmed. While noting that the landscaping and child care operators were independent contractors, the court applied the discretionary function exception to federal liability. The agreements and their actual execution show that the government did not carve out responsibility for safety measures from its otherwise comprehensive delegation of day-to-day authority to the companies. Federal law allows the government discretion to hire independent contractors and to adopt, or not adopt, safety measures suggested by the plaintiffs. View "Carroll v. United States" on Justia Law

Airlines, users of airports owned by the City of Chicago, have use agreements that make they city responsible for runway clearing. The airlines pay a per-landing fee, based on the city's actual expenses. In 1999 and 2000 the airports were crippled by severe snowstorms. The city obtained $6,000,000 in reimbursement from FEMA under the Stafford Disaster Relief and Emergency Assistance Act, 42 U.S.C. 5121. Years later FEMA ordered the city to return the money, based on a provision of the Act concerning duplicate benefits. FEMA asserted that the use agreements entitled the city to reimbursement of costs from the airlines. After exhausting administrative remedies the city filed suit. The district court denied the airlines' motion to intervene. The Seventh Circuit reversed. Finding that the airlines have standing, the court stated that t would not be as "efficient to litigate this three-cornered dispute in two lawsuits rather than one." View "City of Chicago v. Fed. Emergency Mgmt. Agency" on Justia Law

Plaintiff, which owned a nuclear power plant, entered into the standard U.S. Department of Energy contract, under which DOE agreed to collect spent nuclear fuel (SNF) no later than 1998. DOE never began collecting SNF and has breached contracts nationwide. Massachusetts restructured the electric utility industry and, in 1999, the plant sold for $80 million; buyer agreed to accept decommissioning responsibilities for $428 million. The district court awarded $40 million for the portion of the decommissioning fund corresponding to projected post-decommissioning SNF-related costs attributable to DOE’s continuing breach. The court awarded the buyer $4 million in mitigation damages, including direct and overhead costs for new spent fuel racks and fees paid to the NRC. The Federal Circuit reversed in part and remanded. Plaintiff cannot recover damages under a diminution-of-value theory in a partial breach setting. The sale of assets does not alter the principle that when the breaching party has not repudiated and is still expected to perform, anticipated damages are not recoverable until incurred. A non-breaching party may recover from the government indirect overhead costs associated with mitigation and the costs of financing those activities. View "Boston Edison Co. v. United States" on Justia Law

The City of Hugo, Oklahoma, and the Hugo Municipal Authority, a public water trust, (collectively "Hugo") contracted with the City of Irving, Texas, ("Irving") for the sale of water Hugo has been allocated or sought to be allocated under permits issued by the Oklahoma Water Resources Board ("Board"). Hugo and Irving brought suit against the nine members of the Board for a declaration that certain Oklahoma laws governing the Board’s water allocation decisions were unconstitutional under the dormant Commerce Clause and an injunction prohibiting their enforcement. The district court granted summary judgment for the Board, and Hugo and Irving appealed. Upon review, the Tenth Circuit concluded that Hugo, as a political subdivision of Oklahoma, lacked standing to sue the Board under the dormant Commerce Clause. Irving, whose injury was solely premised on a contract it entered into with Hugo, likewise could not demonstrate standing because any injury to Irving cannot be redressed. Concluding no plaintiff had the necessary standing, the Court vacated the district court’s order and remanded the case back the district court to dismiss for lack of federal jurisdiction. View "City of Hugo v. Nichols " on Justia Law

Tarrant Regional Water District ("Tarrant"), a Texas state agency, applied to the Oklahoma Water Resources Board ("the OWRB") for permits to appropriate water at three locations in Oklahoma for use in Texas. Just before filing its applications, Tarrant sued the nine members of the Oklahoma Water Resources Board in the district court for the Western District of Oklahoma and sought a declaratory judgment to invalidate certain Oklahoma statutes that govern the appropriation and use of water and an injunction preventing OWRB from enforcing them. Tarrant alleged that the Oklahoma statutes restricted interstate commerce in water and thereby violated the dormant Commerce Clause as discriminatory or unduly burdensome. Tarrant further alleged that Congress did not authorize Oklahoma through the Red River Compact ("Compact") to enact such laws. OWRB responded that Congress did authorize Oklahoma to adopt these statutes by consenting to the Compact. Tarrant also claimed that the Compact preempted the Oklahoma statutes insofar as the Compact applied to Tarrant’s application to appropriate water located in the Red River Basin. The district court granted summary judgment for OWRB on both the dormant Commerce Clause and Supremacy Clause claims. After that decision, Tarrant took steps to export to Texas Oklahoma water that was not subject to the Compact. Tarrant negotiated a contract with property owners in Stephens County, Oklahoma to export groundwater to Texas and also entered a memorandum of understanding (MOU) with the Apache Tribe concerning the Tribe’s potential water rights. In court Tarrant then reasserted its dormant Commerce Clause challenge based on these transactions. The district court dismissed the Stephens County matter for lack of standing and the Apache Tribe matter as not ripe. Upon review, the Tenth Circuit affirmed the grants of summary judgment on the dormant Commerce Clause and preemption issues, and the dismissals based on standing and ripeness: [w]e hold that the Red River Compact insulates Oklahoma water statutes from dormant Commerce Clause challenge insofar as they apply to surface water subject to the Compact." View "Tarrant Regional Water Dist. v. Herrmann" on Justia Law

A newborn suffered severe brain damage because doctors failed to promptly diagnose and treat an infection contracted at his 2003 birth. He was born prematurely and certain tests, normally done during pregnancy, were not performed by the federally-subsidized clinic where the mother received care. The clinic and its doctors are deemed federal employees under the Federally Supported Health Centers Assistance Act, 42 U.S.C. 233(g)-(n), and shielded from liability under the Federal Tort Claims Act. In 2005 the parents filed suit in state court and, in 2006, HHS denied an administrative claim for damages. Within six months of the denial the case was removed to federal court. In 2010, the district court held that the claim was filed within the two year statute of limitations under the FTCA (28 U.S.C. 2401(b)) and awarded more than $29 million in damages against the government. The Seventh Circuit affirmed. A claim only accrues when a plaintiff obtains sufficient knowledge of the government-related cause of his injury; the plaintiffs were reasonably diligent. View "Arroyo v. United States" on Justia Law

A 66-year -old arrived at petitioner's center with complex ailments, but oriented, able to feed herself and able to speak. During her 18 days at the center, she was sent to the hospital twice with serious medical complications. Upon investigation, the center was found to have failed to maintain substantial compliance with federal regulations for facilities that participate in Medicare and Medicaid (42 U.S.C. § 1395) in its treatment of the resident and appealed the resulting civil money penalty. An administrative law judge, the Departmental Appeals Board, and the Sixth Circuit affirmed. The ALJ acted properly in requiring submission of written testimony, properly weighed the evidence, and found violation of the federal hydration standard, laboratory services requirement, and mandate of a care plan, resulting in "immediate jeopardy." View "Golden Living Ctr.-Frankfort v. Sec'y of Health & Human Servs. " on Justia Law