Articles Posted in U.S. Federal Circuit Court of Appeals

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In 2011, the Forest Service solicited proposals for 34 line items, calling for a negotiated procurement process pursuant to Federal Acquisition Regulation Part 15. Each line item sought heavy or medium exclusive use helicopters for large fire support, tailored for a specific base and meeting performance specifications for operation at that base. Croman, an unsuccessful bidder, filed suit, alleging that the Forest Service’s evaluations of proposals did not have rational bases and were contrary to law. The Claims Court granted the government judgment on the administrative record. The Federal Circuit affirmed, finding that the Forest Service had a rational basis for its decision to partially cancel the solicitation and that the Service conducted a proper tradeoff analysis so that its decision was reasonable. View "Croman Corporation v. United States" on Justia Law

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USM builds military boats. Working with VT Halter, USM designed a special-operations craft with a hull made out of composite materials for use in competing for the Navy's “MK V Special Operations Craft and Transporter System Contract.” With its 1993 bid, VT Halter submitted drawings stamped with a “Limited Rights Legend” to invoke Defense Federal Acquisition Regulations Supplement Section 252.227-7013(a)(15), which limits governmental use and disclosure of certain information. VT Halter won the contracts and delivered 24 Mark V special-operations craft. In 2004, the Navy awarded University of Maine a research grant to improve the ride and handling of the Mark V and provided detailed design drawings of the Mark V to contractors, stamped with the DFARS Limited Rights Legend, but did not obtain VT Halter’s consent for disclosure. The Navy awarded Maine Marine a contract to design and construct a prototype Mark V.1. USM sued under the Federal Tort Claims Act, 28 U.S.C. 1346(b), alleging misappropriation of trade secrets. The district court awarded damages, but the Fifth Circuit held that the matter lay exclusively within the jurisdiction of the Court of Federal Claims under the Tucker Act, 28 U.S.C. 1491(a)(1). The Fifth Circuit vacated the judgment and ordered transfer. The Federal Circuit affirmed. View "U.S. Marine, Inc. v. United States" on Justia Law

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The Navy solicited bids for maritime husbanding support services to ships visiting ports in regions in the Western Pacific and Indian Ocean for separate negotiated procurements. Offerors were to submit separate proposals for each region in which they sought a contract. The solicitation identified factors to be used to evaluate acceptable offers. Offerors were instructed to submit past performance information. GDMA and MLS submitted proposals for the Region 1, South Asia, contract. GDMA appealed the award of the contract to MLS. The Court of Federal Claims granted judgment on the record in favor of the government and MLS. The Federal Circuit affirmed. The Court of Federal Claims found that even if GDMA should have gotten a “Satisfactory” rating instead of “Less than Satisfactory” for past performance GDMA still would have had an inferior past performance rating as compared to MLS, and still would have had negative past performance comments in the record. GDMA did not provide anything but conjecture that even with a “Satisfactory” rating it would have had a substantial chance of prevailing in the bid. GDMA failed to establish that the award to MLS was arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law. View "Glenn Def. Marine (Asia) PTE, Ltd. v. United States" on Justia Law

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General Dynamics entered into fixed-price contracts, fixed-price incentive contracts, cost-plus-fixed fee contracts, cost-plus-award-fee contracts, and time-and-materials contracts with the Department of Defense. Many require compliance with Cost Accounting Standards (CAS), which provide uniformity in how contractors measure, assign, and allocate costs to government contracts, including guidance for determining and measuring the components of pension cost, CAS 412-20(a). The Defense Contract Management Agency notified General Dynamics in 2006 that its use of a blended rate using partial-year valuations did not comply with CAS 412. The Contracting Officer issued notice of noncompliance in 2007. General Dynamics then submitted a compliant retirement plan, but, in 2008, again submitted a plan using the blended rate for the base year. The CO issued a second determination of noncompliance. The Armed Services Board of Contract Appeals denied General Dynamics’ appeal, determining that use of partial-year asset data reflected short-term fluctuations that could and did introduce distortion prohibited by CAS 412-50(b)(4) and that substitution of a midyear value and a blended rate in place of the 8 percent long-term estimate rate constituted “actuarial assumptions” because they were “estimate[s] of future conditions affecting pension cost” and were encompassed by the prohibitions of CAS 412-50(b)(4). The Federal Circuit affirmed. View "Gen. Dynamics Corp. v. Panetta" on Justia Law

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In 1983, the Nuclear Waste Policy Act established a plan for spent nuclear fuel (SNF) generated by nuclear power plants, 42 U.S.C. 10101–10270. The Act made utilities responsible for SNF storage until the U.S. Department of Energy (DOE) accepts the material. The Secretary of Energy entered into contracts with nuclear utilities to accept SNF in return for payment of fees. The Act provided that the Nuclear Regulatory Commission “shall not issue or renew a license” to any nuclear utility unless the utility has entered into a contract with DOE or DOE certifies ongoing negotiations. Nuclear utilities, including the owner of the Entergy nuclear power stations, entered into contracts and began making payments, which have continued. By 1994, DOE knew it would be unable to accept SNF by the Act’s January 31, 1998 deadline. In 1995, DOE issued a “Final Interpretation” that took the position that it did not have an unconditional obligation to begin performance on that date. Entergy sued, asserting that DOE’s partial breach caused it to incur additional costs for SNF storage. The claims court struck an unavoidable delay defense, based on a prior decision rejecting DOE’s argument that its failure was “unavoidable” under the contract. The Federal Circuit affirmed. View "Entergy Nuclear Fitzpatrick, LLC v. United States" on Justia Law

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Rohrer Towers is a housing facility for low-income elderly residents in Haddon Township, Camden County, New Jersey. Haddon leased Rohrer Towers to Housing Authority of the Township of Haddon, which entered into a housing assistance payments contract (HAP) with the U.S. Department of Housing and Urban Development (HUD) under the Housing Act of 1937, 88 Stat. 633, 662–66. Haddon sued in 2007 alleging that HUD breached the HAP Contract from 2001-2006 by requiring rent “comparability studies” to be submitted along with requests for annual rent adjustments and adopting a one-percent reduction of the annual adjustment factors for units occupied by the same tenants from the previous year. The Claims Court agreed and ordered rent adjustments for all years other than 2002. The government claimed that the complaint should have been dismissed on statute of limitations grounds and appealed the decision that regulatory imposition of a mandatory one-percent rent reduction for non-turnover units was arbitrary, and beyond HUD’s authority. The Federal Circuit reversed the holding that the prevention doctrine applied to the circumstances surrounding Haddon’s 2001 and 2003 rent adjustment, but affirmed the holdings with respect to the contract years 2002 and 2004-2006. View "Haddon Housing Assocs. v. United States" on Justia Law

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Casitas Water District operates the Ventura River Project, which is owned by the U.S. Bureau of Reclamation and provides water to Ventura County, California, using dams, reservoirs, a canal, pump stations, and many miles of pipeline. In 1997, the National Marine Fisheries Service listed the West Coast steelhead trout as an endangered species and determined that the primary cause of its decline was loss of habitat due to water development, including impassable dams. Casitas faced liability if continued operation of the Project resulted in harm to the steelhead, 16 U.S.C. 1538(a)(1), 1540(a)–(b). In 2003, NMFS issued a biological opinion concerning operation of a fish ladder to relieve Casitas of liability. Casitas opened the Robles fish ladder, then filed suit, asserting that the biological opinion operating criteria breached its 1956 Contract with the government or amounted to uncompensated taking of Casitas’s property. The Claims Court dismissed, citing the sovereign acts doctrine. The Federal Circuit affirmed dismissal of the contract claim, but reversed dismissal of Casitas’s takings claim. The court again dismissed, holding that Casitas had failed to show that the operating criteria had thus far resulted in any reduction of water deliveries, so a takings claim was not yet ripe. The Federal Circuit affirmed. View "Casitas Mun. Water Dist. v. United States" on Justia Law

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Sharp, a federal supply contractor, submitted a termination compensation claim to the Department of the Army contracting officer, and later brought a Contracts Dispute Act claim before the Armed Services Board of Contract Appeals, claiming that, because the Army failed to exercise the entirety of the last option year under a delivery order, Sharp was entitled to premature discontinuance fees under its General Services Administration schedule contract. The ASBCA dismissed for lack of subject-matter jurisdiction, concluding that the Federal Acquisition Regulation, does not permit ordering agency contracting officers to decide disputes pertaining to schedule contracts. The Federal Circuit affirmed. Under FAR 8.406-6, only the GSA contracting office may resolve disputes that, in whole or in part, involve interpretation of disputed schedule contract provisions. View "Sharp Elec. Corp. v. McHugh" on Justia Law

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McGuire leased farmland in Arizona from the Colorado River Indian Tribes with approval of the Bureau of Indian Affairs. After the BIA removed a bridge that he used to access portions of the leased property, McGuire filed a Fifth Amendment claim. McGuire does not claim that removal of the bridge was itself a taking, but rather that the BIA’s alleged refusal to authorize replacement of the bridge was a taking of his property rights. The Court of Federal Claims rejected the claim. The Federal Circuit affirmed, holding that the regulatory takings claim never ripened because McGuire failed to pursue administrative remedies. Even if McGuire’s claim had ripened, he had no cognizable property interest in the bridge, which he neither possessed nor controlled because it was in a BIA right-of-way. No federal regulation gave him a property interest and he was not entitled to an easement by necessity. View "McGuire v. United States" on Justia Law

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In 2001, U.S. Immigrations and Customs Enforcement awarded Northrop a contract for lease and support of Oakley network monitoring software for one base year and three option years at about $900,000 per year. To obtain Oakley’s software, Northrop was required to pay $2,899,710, so Northrup assigned its payment rights to ESCgov for $3,296,093. ESCgov assigned its rights to Citizens, but the government was not notified. In 2005, ICE decided not to exercise the first option. Northrop sent the contracting officer a “Contract Disputes Act Claim for not Exercising Option,” citing the Contract Disputes Act, 41 U.S.C. 601. The letter did not mention the two assignments. The CO denied Northrop’s claim. The Court of Federal Claims dismissed, holding that Northrop had not supplied the CO “adequate notice” because it failed to reference potential application of the Anti-Assignment Act and Severin doctrine. While the matter was pending, Northrop filed a second claim, including documents on the financing arrangements. The CO determined that Northrop’s second claim was the same claim and declined to issue a final decision. The Claims Court again held that it lacked jurisdiction. The Federal Circuit consolidated the cases and reversed, finding that the first letter constituted a valid claim. View "Northrop Grumman Computing Sys., Inc. v. United States" on Justia Law