Justia Government Contracts Opinion Summaries

Articles Posted in US Court of Appeals for the Ninth Circuit
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In 1993, the County and the Orange County Employee Retirement System (OCERS) entered into a Memorandum of Understanding (MOU), allowing the County to access surplus investment earnings controlled by OCERS and depositing a portion of the surplus into an account to pay for county retirees' health insurance. The county adopted the Retiree Medical Plan, funded by those investment earnings and mandatory employee deductions. The Plan explicitly provided that it did not create any vested rights. The labor unions then entered into MOUs, requiring the county to administer the Plan and that retirees receive a Medical Insurance Grant. In 1993-2007, retired employees received a monthly grant benefit to defray the cost of health insurance. In 2004, the county negotiated with its unions to restructure the underfunded program, reducing benefits for retirees.Plaintiffs filed suit. The Ninth Circuit affirmed summary judgment in favor of the county. The 1993 Plan explicitly provided that it did not create any vested right to benefits. The Plan was adopted by resolution and became law with respect to Grant Benefits, part of the MOUs. The MOUs expired on their own terms by a specific date. Absent express language providing that the Grant Benefits vested, the right to the benefits expired when the MOUs expired. The Plan was not unilaterally imposed on the unions and their employees without collective bargaining; the unions executed MOUs adopting the Plan. The court rejected an assertion that the Grant Benefit was deferred compensation and vested upon retirement, similar to pension benefits. View "Harris v. County of Orange" on Justia Law

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California AB 32 phases out private detention facilities within the state. Because of fluctuations in immigration, ICE relies exclusively on private detention centers in California. AB 32 carves out exceptions for the state’s private detention centers. The United States and GEO, which operates private immigration detention centers, sued. The district court ruled largely in favor of California.The Ninth Circuit reversed. California is not simply exercising its traditional police powers, but rather impeding federal immigration policy. . Under the Supremacy Clause, state law must fall if it stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress. The presumption against preemption does not apply to areas of exclusive federal regulation, such as the detention of immigrants. California did more than just exercise its traditional state police powers – it impeded the federal government’s immigration policy. Congress granted the Secretary of the Department of Homeland Security broad discretion over immigrant detention, including the right to contract with private companies to operate detention facilities. AB 32 also discriminated against the federal government in violation of the intergovernmental immunity doctrine by requiring the federal government to close all its detention facilities, while not requiring California to close any of its private detention facilities until 2028. View "GEO Group, Inc., v. Newsom" on Justia Law

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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

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The Ninth Circuit reversed the district court's dismissal of a qui tam action brought by relator under the False Claims Act, alleging that defendants submitted, or caused to be submitted, Medicare claims falsely certifying that patients' inpatient hospitalizations were medically necessary.After determining that it had jurisdiction, the panel held that a plaintiff need not allege falsity beyond the requirements adopted by Congress in the FCA, which primarily punishes those who submit, conspire to submit, or aid in the submission of false or fraudulent claims. The panel wrote that Congress imposed no requirement of proving "objective falsity," and the panel had no authority to rewrite the statute to add such a requirement. The panel held that a doctor’s clinical opinion must be judged under the same standard as any other representation. The panel explained that a doctor, like anyone else, can express an opinion that he knows to be false, or that he makes in reckless disregard of its truth or falsity. Therefore, a false certification of medical necessity can give rise to FCA liability. The panel also held that a false certification of medical necessity can be material because medical necessity is a statutory prerequisite to Medicare reimbursement. View "Winter v. Gardens Regional Hospital & Medical Center, Inc." on Justia Law

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The Ninth Circuit reversed the district court's dismissal of relator's qui tam action under the False Claims Act (FCA) against KCI, alleging that the company submitted false claims to Medicare. The panel held that relator sufficiently alleged that KCI violated the Act by adequately alleging a fraudulent scheme to submit false claims and reliable data that led to a strong inference that false claims were actually submitted. The panel also held that relator sufficiently alleged that KCI acted with the requisite scienter under the Act, and KCI's false claims were material to the government's payment decision. View "United States ex rel Godecke v. Kinetic Concepts, Inc." on Justia Law

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Petitions for review of compensation orders arising under the Defense Base Act should be filed in the circuit where the relevant district director is located. The Ninth Circuit denied a petition for review challenging the Benefits Review Board's decision concluding that a linguist who supported the military in Iraq was entitled to workers' compensation under the Defense Base Act.The panel held that substantial evidence supported the ALJ's determination that claimant met both the medical and the economic aspect of disability as defined by the statute; the ALJ applied the correct legal standard when considering the evidence in this case; and the ALJ correctly concluded that claimant met his burden to show that he was disabled. View "Global Linguist Solutions, LLC v. Abdelmeged" on Justia Law

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Solis alleged that his former employers violated the federal False Claims Act (FCA) by promoting dangerous off-label uses of a cardiovascular drug, Integrilin, and by paying physicians kickbacks to prescribe Integrilin and an antibiotic drug, Avelox. The district court found that Solis’s FCA claims were foreclosed by the public disclosure bar, which deprives federal courts of subject matter jurisdiction over FCA suits when the alleged fraud has already been publicly disclosed unless the relator is deemed an original source. The Ninth Circuit affirmed in part, holding that Solis’s Integrilin claims were substantially similar to those in prior public disclosures, and were close enough in kind and degree to have put the government on notice to investigate the alleged fraud before Solis filed his complaint. The court vacated the dismissal of Solis’s Integrilin claims and remanded for a determination of whether Solis qualified for the “original source” exception, 31 U.S.C. 3730(e)(4). Concerning Solis’s Avelox claims, the court held that the district court clearly erred in finding that the Avelox claims were publicly disclosed based on court complaints that never mentioned Avelox but affirmed the dismissal of Solis’s Avelox claims on the alternative ground of failure to plead with particularity as required by Fed.R.Civ.P. 9(b). View "Solis v. Millenium Pharmaceuticals, Inc." on Justia Law

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The government-action bar, 31 U.S.C. 3730(e)(3), applies even when the Government is no longer an active participant in an ongoing qui tam lawsuit. The existence of multiple claims—some of which the Government settles—has no bearing on the Government's relationship to the entire action. The Ninth Circuit affirmed the dismissal of a qui tam action brought under the False Claims Act (FCA), 31 U.S.C. 3729 et seq., alleging that a medical device supplier, Biotronik, engaged in a series of wrongful acts. The panel held that the Government remained a party to suits that have been settled, and the Government could not be said "partially" to have intervened in a prior qui tam suit. Therefore, relator was barred by section 3730(e)(3). View "United States ex rel. Bennett v. Biotronik, Inc." on Justia Law

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TDY filed a complaint under the Comprehensive Environmental Response Compensation and Liability Act (CERCLA), 42 U.S.C. 9613(f)(1), seeking contribution from the government for its equitable share of the cleanup costs. The Ninth Circuit reversed the district court's grant of judgment in favor of the United States, which allocated 100 percent of past and future CERCLA costs to TDY. The panel agreed with the district court that some deviation from the allocation affirmed in Shell Oil Co., 294 F.3d at 1049, and Cadillac Fairview, 299 F.3d at 1022–23, was warranted by distinguishing facts. However, the panel held that encumbering a military contractor with 100 percent of CERCLA cleanup costs that were largely incurred during war-effort production was a 180 degree departure from the panel's prior case law, and the out-of-circuit authority that the district court relied upon did not warrant such a sharp deviation. In this case, the district court did not adequately consider the parties' lengthy course of dealings and the government's requirement that TDY use two of the hazardous chemicals at issue. Accordingly, the court remanded for additional proceedings. View "TDY Holdings v. United States" on Justia Law

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Relators filed suit under the False Claims Act (FCA), 31 U.S.C. 3729-33, alleging that Gilead made false statements about its compliance with FDA regulations regarding certain HIV drugs. The Ninth Circuit reversed the district court's dismissal of relators' complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). The panel held that relators stated a plausible claim by alleging factually false certification, implied false certification, and promissory fraud. Furthermore, relators adequately plead scienter, materiality, and that Gilead submitted false claims. The panel reversed the dismissal of the retaliation claim, holding that the Second Amended Complaint sufficiently alleged facts showing that Relator Jeff Campie had an objectively reasonable, good faith belief that Gilead was possibly committing fraud against the government; sufficient facts to show Gilead knew of Campie's protected activity; and causation. View "United States ex rel. Campie v. Gilead Sciences, Inc." on Justia Law