Justia Government Contracts Opinion Summaries

In 2014, the Arkansas State Highway and Transportation Department issued a bid invitation for a janitorial and cleaning-services contract. O.J.’s Service Two, Inc. submitted a bid for the contract. The Highway Department, however, awarded the contract to another bidder, RazorClean. O.J.’s protested the contract award, contending that RazorClean’s bid did not conform to the specifications in the bid invitation. The Highway Department denied O.J.’s protest. Thereafter, O.J.’s filed suit against the Highway Department and other state defendants (collectively, “Defendants”) requesting a writ of mandamus compelling Defendants to follow the Arkansas procurement laws and regulations and requiring Defendants to declare the contract with RazorClean null and void and to award the contract to O.J.’s. Defendants filed a motion to dismiss, asserting that O.J.’s claims were barred by sovereign immunity. The circuit court denied the motion. Defendants subsequently filed this interlocutory appeal. The Supreme Court dismissed the appeal as moot, holding that because the contract at issue in the lawsuit had been fully performed, the matter is now moot, and none of the exceptions to the mootness doctrine apply. View "Ark. Highway & Transp. Dep't v. O.J.’s Serv. Two, Inc." on Justia Law

In 2005 the Army Corps of Engineers invited bids on a federal reservoir project in Illinois. One of the successful bidders was Slurry, which leased from Pileco a trench cutter made by Bauer. Slurry was a prime contractor on the Corps of Engineers’ project; the Miller Act, 40 U.S.C. 3131, requires prime contractors on some government construction projects to post bonds. Slurry used Fidelity as surety. The bond insured against a failure by Slurry to pay subcontractors, such as Pileco. Contending that the cutter was defective, Slurry refused to pay the agreed rental price. Pileco sued Slurry and Fidelity, asserting breach of contract that Fidelity violated the Miller Act by failing to reimburse Pileco for costs associated with Slurry’s reneging on its obligation to pay. Slurry counterclaimed. A second trial resulted in a verdict in Pileco’s favor except for a $357,716 equitable adjustment in favor of Slurry, based on time that cutter was inoperable because of a defect attributable to Pileco. The net result was that Pileco was awarded $2.23 million against Slurry for breach of contract and the same amount against Fidelity for the Miller Act violation. The Seventh Circuit affirmed, except with respect to the denial of prejudgment interest and costs. View "Pileco, Inc. v. Slurry Systems, Inc." on Justia Law

Plaintiffs, a putative class of electrical workers, claimed that their respective employers, in collusion with Metropolitan Pier and Exposition Authority (MPEA, which used electricians supplied by the employers) wrongfully terminated them, in violation of a collective bargaining agreement (CBA) and federal labor law and circumvented the CBA-mandated hiring process and that their union, International Brotherhood of Electrical Workers, failed to adequately represent them in the CBA-mandated grievance process. The district court denied motions to dismiss four counts, but dismissed a declaratory judgment motion against MPEA and two employers, and the claim of state law tortious interference with contracts against MPEA. The district court held that, as a political subdivision, MPEA is not an “employer” under Section 301 of the Labor Management Relations Act of 1947, 29 U.S.C. 185. Plaintiffs appealed only the dismissal of the tortious interference claim against MPEA. The Seventh Circuit affirmed, rejecting an argument that jurisdiction was created by the need to interpret the CBA. With respect to political subdivisions, section 301 preempts not only claims “founded directly” on the collective bargaining agreement, but also state law claims that indirectly implicate a collective bargaining agreement. View "Healy v. Metro. Pier & Exposition Auth." on Justia Law

The U.S. Air Force solicited bids from private companies to supply equipment and services to build a new radar system. Raytheon, Northrop Grumman, and Lockheed Martin cleared early hurdles; each received a solicitation for proposals for Engineering and Manufacturing Development. The Air Force subsequently sent Evaluation Notices to Raytheon and Northrop that “contractors would not be permitted to use IR & D costs to reduce their costs of performing . . . if those costs were implicitly or explicitly required for contract performance.” Raytheon objected; Northrop did not.. The Air Force then changed its view and accepted Raytheon’s treatment of certain costs as IR & D costs, but never communicated its new view to Northrop. In final proposals, Raytheon proposed IR & D cost reductions, whereas Northrop did not. The Air Force awarded the contract to Raytheon. Northrop and Lockheed filed protests with the Government Accountability Office (31 U.S.C. 3551). In response, the Air Force “decided to take corrective action” and to reopen discussions. Raytheon filed a protest under 28 U.S.C. 1491(b) to challenge the decision to take corrective action. The Federal Circuit affirmed denial of the protest, concluding that the reopening decision was proper based on the disparate-information violation. View "Raytheon Co. v. United States" on Justia Law

Appellant, the Greater Boise Auditorium District, filed a petition for judicial confirmation (pursuant to Idaho Code section 7-1304) asking the district court for a determination that a lease the District intended to enter into did not violate the Constitution’s Article VIII, section 3 clause prohibiting a municipal body, without voter approval, from incurring indebtedness or liabilities greater than it has funds to pay for in the fiscal year. Respondent, Boise resident and property owner David Frazier, objected to the requested judicial confirmation, and appeared in the case to contest it. The district court denied the Petition for Judicial Confirmation and the District appealed. Frazier sought attorneys’ fees on appeal. After review, the Supreme Court reversed the district court’s denial of the District’s request for judicial confirmation and held that the agreements into which it entered satisfied Article VIII, section 3 of the Constitution. View "Greater Boise Auditorium District v. Frazier" on Justia Law

Trona is a sodium carbonate compound that is processed into soda ash or baking soda. Because oil and gas development posed a risk to the extraction of trona and trona worker safety, the Bureau of Land Management (BLM), which manages the leasing of federal public land for mineral development, indefinitely suspended all oil and gas leases in the mechanically mineable trona area (MMTA) of Wyoming. The area includes 26 pre-existing oil and gas leases owned by Barlow. Barlow filed suit, alleging that the BLM’s suspension of oil and gas leases constituted a taking of Barlow’s interests without just compensation and constituted a breach of both the express provisions of the leases and their implied covenants of good faith and fair dealing. The Federal Circuit affirmed the Claims Court’s dismissal of the contract claims on the merits and of the takings claim as unripe. BLM has not repudiated the contracts and Barlow did not establish that seeking a permit to drill would be futile. View "Barlow & Haun, Inc. v. United States" on Justia Law

Mike Layer built a sewer pumping station for Barrow County, and he allegedly entered into an agreement with the County pursuant to which he would retain an interest in a portion of the pumping capacity at the station. Layer, however, failed to get this alleged agreement in writing. After he was refused his alleged interest in the pumping capacity, Layer sued Barrow County, the City of Auburn, and a host of county and city officials (in both their official and individual capacities), asserting breach of contract, unjust enrichment, breach of the implied covenant of good faith and fair dealing, promissory estoppel, and an unconstitutional taking of his property without just compensation. The trial court dismissed his lawsuit, and Layer appealed. Finding no reversible error, the Supreme Court affirmed. View "Layer v. Barrow County" on Justia Law

Relators filed related qui tam actions, alleging that government contractors, including Cisco, committed fraud against the government by means of a kickback and defective pricing schemes in violation of the False Claims Act (FCA), 31 U.S.C. 3729-3733 and the Anti-Kickback Act, 41 U.S.C. 51-52. The government intervened against Cisco, adopted the complaint, and settled the action. The government objected to relators’ claim to a percentage of the settlement on the ground that the relators’ complaint did not plead the conduct that formed the basis of the claims that the government ultimately settled; that the relators’ claims based on an alleged kickback scheme lacked merit; and that the settlement covered a separate defective pricing scheme. The district court awarded relators over eight million dollars. The Eighth Circuit initially affirmed. On rehearing, en banc, the Eighth Circuit vacated and remanded, concluding that the relator may recover only from the proceeds of the settlement of the claim that he brought. The district court’s order did not clearly apply that legal standard or make factual findings necessary to resolve the case under that standard. View "Rille v. United States" on Justia Law

In 2000 the Port Authority signed a 30-year lease for the largest marine terminal at Port Elizabeth (445 acres including structures and berthing) with Maher, which handles cargo. The Lease requires “Basic Rental,” (in 2012, $50,413 per acre, totaling $22,433,612) plus “Container Throughput Rental,” based on the type and volume of cargo at Maher’s terminal. For eight years, Maher was exempted from Throughput Rental. Since 2008 the first 356,000 containers are exempted; for containers 356,001 to 980,000, Maher paid $19.00 per container in 2012; and for each additional container, Maher paid $14.25. Maher must handle a minimum amount of cargo to maintain the Lease and pay an annual guaranteed minimum Throughput Rental. Maher paid $12.5 million in Throughput Rental in 2010, and expected the 2012 amount to be $14 million. Maher claims the Port Authority profits from the Lease and uses the revenue to fund harbor improvements and projects unrelated to services provided to Maher or vessels. In 2012 Maher sued, alleging violations of the Constitution’s Tonnage Clause; the Rivers and Harbors Appropriation Act, 33 U.S.C. 5(b); and the Water Resources Development Act, 33 U.S.C. 2236. The Third Circuit affirmed dismissal, agreeing that Maher lacked standing to bring its Tonnage Clause and RHA claims because it was not a protected vessel and did not adequately plead that fees imposed on vessels were not for services rendered. Maher’s WRDA claim failed because Maher had not shown that the Authority imposed fees on vessels or cargo and because the WRDA did not prohibit use of Lease revenue to finance harbor improvements. View "Maher Terminals LLC v. Port Auth. of NY" on Justia Law

Nagle and Fink were co-owners and executives of concrete manufacturing and construction businesses. The businesses entered into a relationship with a company owned by a person of Filipino descent. His company would bid for subcontracts on Pennsylvania transportation projects as a disadvantaged business enterprise. Federal regulations require states that receive federal transportation funds to set annual goals for participation in transportation construction projects by disadvantaged business enterprises, 49 C.F.R. 26.21. If his company won the bid for the subcontract, Nagle and Fink’s businesses would perform all of the work. Fink pled guilty to conspiracy to defraud the United States. A jury found Nagle guilty of multiple charges relating to the scheme. The Third Circuit affirmed Nagle’s conviction, upholding the admission of electronic evidence discovered during searches of the businesses’ offices, but vacated both sentences, based on loss calculation errors. View "United States v. Nagle" on Justia Law