Justia Government Contracts Opinion Summaries

Couch was employed as a truck driver by B&B, a private company that has Highway Contract Route contracts with the Postal Service. While Couch was making a delivery to a postal facility in Illinois, a U.S. Postal Service employee ran over his foot with a forklift. Two years later, Couch died, allegedly as a result of complications from the injury. After her husband died, plaintiff sued the United States under the Federal Tort Claims Act, which provides a cause of action for personal injuries negligently caused by federal employees acting within the scope of their employment, 28 U.S.C. 1346(b)(1). The district court granted the United States summary judgment, finding that Couch was a “borrowed employee,” so that workers’ compensation would provide Couch’s only remedy against both the borrowing and lending employers. The Seventh Circuit reversed. The private trucking company does not merely “lend employees” to the Postal Service but provides mail transportation and delivery services. The company trains, equips, pays, and supervises its own employees using its own equipment to provide these services. View "Couch v. United States" on Justia Law

In 2009 the Forest Service awarded Scott contracts to remove timber on federally-owned plots during a designated period. Scott was then pursuing litigation based on delays in other contracts resulting from environmental litigation. The government therefore included provisions in the contracts at issue, authorizing suspension of the contracts to comply with court orders or for environmental reasons. The contracts provided for term adjustment, but prohibited award of lost profits, attorney’s fees, replacement costs, and similar losses. Another environmental suit arose in Oregon, resulting in an injunction that included the contracts at issue. The Forest Service suspended the contracts and began protected species surveys required by that litigation. Surveys were completed in late 2000, but the suspensions continued, due to new litigation, until 2003. In 2004-2008, Scott harvested the total contractual amount of timber. In 2005, Scott sought damages. The Claims Court found breach of an implied duty of good faith and fair dealing and that the government unreasonably delayed the surveys and continued the suspensions. The court found that Scott was entitled to $28,742 in lost profits and $129,599 in additional costs, offset by some actual profit; the government was also liable to a log-processing subcontractor, for $6,771,397 in lost profits; The Federal Circuit reversed. View "Scott Timber Co. v. United States" on Justia Law

Stoerr pled guilty to bid rigging, 15 U.S.C. 1; conspiracy to provide kickbacks and to defraud the United States, 18 U.S.C. 371; and assisting in the preparation of false tax returns, 26 U.S.C. § 7206(2). The convictions stemmed from kickback payments that Stoerr solicited and accepted from sub-contractors in connection with environmental remediation projects managed by Sevenson, his employer from 1980 to October 2003. In total, the district court determined that the scheme resulted in losses of $134,098.96 to the EPA and $257,129.22 to Tierra. After Sevenson learned of the kickbacks scheme, it paid Tierra approximately $241,000 to compensate for its losses. It then commenced a civil action against Stoerr in state court to recover its losses, and sought restitution in connection with Stoerr’s sentencing, under the Mandatory Victims Restitution Act, 18 U.S.C. 3663A, for reimbursement of the amount that it paid to Tierra. The district court denied Sevenson‟s request for restitution, instead ordering that Stoerr pay restitution to Tierra. The Third Circuit dismissed; as a non-party, Sevenson lacks standing to appeal. View "United States v. Stoerr" on Justia Law

The Army solicited proposals for aerial target flight operations and maintenance services. Kratos provided these services under a predecessor contract. The solicitation listed three evaluation factors: Technical/Management; Past Performance; and Price/Cost to be rated as “outstanding,” “satisfactory,” “marginal,” or “unsatisfactory.” The contract was subject to the Service Contract Act of 1965, under which the Federal Acquisition Regulation requires that “successor contractors … in the same locality must pay wages and fringe benefits … at least equal to those contained in any bona fide collective bargaining agreement … under the predecessor contract.” The Army received three proposals, including the offers from SA-TECH and Kratos. After review, the Technical Evaluation Committee announced a Final Evaluation Report, noting potential difficulties for SA-TECH under the Labor sub-factor, but rating SA-TECH as “outstanding” for all factors. Kratos also received “outstanding” ratings. The Source Selection Authority concluded that SA-TECH offered the best value for the government. Kratos filed a protest with the Government Accountability Office. SA-TECH subsequently protested the Army’s decision to engage in corrective action instead of allowing SA-TECH’s award to stand. The Claims Court denied the Army’s motion to dismiss and found the Army’s actions unreasonable and contrary to law. The Federal Circuit affirmed. View "Sys. Application & Tech., Inc. v. United States" on Justia Law

Watkins, an African-American, worked for the school district, overseeing security systems. Fultz supervised Watkins and, relying on Watkins’s advice, Fultz awarded Vision a $182,000 annual contract for service of security cameras. Vision’s president, Newsome, testified that Watkins called her and talked about a “finder’s fee.. Newsome went to Cleveland for a customer visit. She e-mailed Watkins and he replied: “Absolutely$.” Newsome believed that Watkins expected her to pay him at their meeting. Newsome notified Fultz. At the meeting, Watkins requested “an envelope.” After Fultz contacted police, the FBI recorded meetings at which Newsome gave Watkins $5,000 and $2,000. A white jury convicted on two counts of attempted extortion “under color of official right” (Hobbs Act, 18 U.S.C. 1951), and one count of bribery in a federally funded program, 18 U.S.C. 666(a)(1)(B). The court determined a total offense level of 22, applying a two-level enhancement for obstruction of justice, another two-level enhancement for bribes exceeding $5,000, and a four-level enhancement for high level of authority, plus an upward variance of 21 months under 18 U.S.C. 3553(a), and sentenced Watkins to six years’ incarceration. The Sixth Circuit affirmed, rejecting challenges to jury instructions, sufficiency of the evidence, the jury’s racial composition, and the reasonableness of the sentence.View "United States v. Watkins" on Justia Law

Jewish Home of Eastern Pennsylvania (JHEP) provides nursing care to Medicare beneficiaries and is required to comply with the mandatory health and safety requirements for participation. JHEP must submit to random surveys conducted by state departments of health. In 2005, the Pennsylvania Department of Health conducted a survey that concluded that JHEP had eight regulatory deficiencies, including violations of 42 C.F.R. 483.25(h)(2), which requires a facility to ensure that each resident receives adequate supervision and assistance with devices to prevent accidents. Based on those deficiencies and those found in a 2006 survey, the Center for Medicare and Medicaid Services imposed fines totaling $17,150 and $12,800. JHEP claimed that the allegations of noncompliance were based on the inadmissible disclosure of privileged‖ quality assurance records and that the monetary penalties violated its right to equal protection because they were the product of selective enforcement based on race and religion. An ALJ upheld the fines against JHEP. The Third Circuit denied a petition for review. View "Jewish Home of E. PA v. Centers for Medicare and Medicaid Servs." on Justia Law

In August 2008 Ellington accepted the position of Deputy Clerk of the City Council of East Cleveland. The City Council wanted him, but then-Mayor, Brewer, stood in the way. After resolution of an approximately three-month-long standoff between the sides, Ellington began receiving regular paychecks and compensation for wages unpaid since he had begun performing services. Ellington sued, claiming that failure to issue him paychecks between August 2008 and November 2008 violated the minimum wage and overtime provisions of the Fair Labor Standards Act, 29 U.S.C. 201–219, article II, section 34a of the Ohio Constitution; and the Ohio Minimum Fair Wage Standards Act, Ohio Rev. Code 4111.01–.99. The district court concluded that Ellington, as an employee of the City Council, was subject to the “legislative employee” exclusions to the federal and state minimum wage and overtime provisions and granted summary judgment in favor of defendants. The Sixth Circuit affirmed. To conclude that Ellington, who has been found to be an employee of a legislative body, is covered by the FLSA because, as Deputy Clerk of Council, he is also part of the City of East Cleveland’s workforce would effectively excise the FLSA’s “legislative employee” exclusion. View "Ellington v. City of East Cleveland" on Justia Law

Plaintiff brought suit under the qui tam provisions of the False Claims Act (FCA) against Lockheed Martin Corporation, alleging that Lockheed defrauded the United States Air Force under a contract for the Range Standardization and Automation IIA program concerning software and hardware used to support space launch operations at Vandenberg Air Force Base and Cape Kennedy. Hooper filed his suit in the Maryland district court, which transferred the suit to the central district of California on forum non conveniens grounds. The district court granted summary judgment in favor of Lockheed on all grounds. The Ninth Circuit Court of Appeals (1) affirmed the district court's evidentiary rulings and conclusion that Hooper failed to establish his claims of fraudulent use of the software and defective testing procedures because there was no genuine issue of material fact as to whether Lockheed "knowingly" submitted a false claim; and (2) reversed the district court's dismissal of (i) Hooper's wrongful discharge claim as barred by California's two-year statute of limitations, holding that Maryland's three-year statute of limitations applied here, and (ii) Hooper's claim that Lockheed violated the FCA by knowingly underbidding the contract. View "Hooper v. Lockheed Martin Corp." on Justia Law

DGR, seeking an Air Force contract, filed a formal agency-level protest with respect to bid procedures, which the Air Force denied, referencing a DOJ memorandum and a memorandum from the Office of Management and Budget. Pursuant to established appeal procedures, DGR next filed its protest with the GAO, which sustained the appeal despite the contrary Department of Justice and OMB directives. The Air Force was told to rebid the contract consistent with the GAO reading of the Act. The Air Force declined to comply. DGR filed suit, prevailed, and was awarded attorneys’ fees and costs under the Equal Access to Justice Act, 28 U.S.C. § 2412. The Court of Federal Claims determined that the government’s position in the underlying bid protest was not substantially justified. The Federal Circuit reversed. Given the then-existing disagreement among all three branches of the federal government over the law applicable to this bid protest, the Claims Court erred in finding that the government’s position was not substantially justified. View "DGR Assocs., Inc. v. United States" on Justia Law

In 1978, Hages acquired a ranch in Nevada occupying approximately 7,000 acres of private land and approximately 752,000 acres of federal lands under grazing permits. Their predecessors had acquired water rights now located on federal lands, 43 U.S.C. 661. Hages had disputes with the government concerning release of non-indigenous elk onto federal land for which Hages had grazing permits, unauthorized grazing by Hages’ cattle, and fence and ditch maintenance. After a series of incidents, in 1991, Hages filed suit alleging takings under 43 U.S.C. 1752(g), and breach of contract. After almost 20 years, the Claims Court awarded compensation for regulatory taking of water rights; physical taking of water rights; and range improvements. The court awarded pre-judgment interest for the takings, but not for the range improvements. The Federal Circuit vacated in part. The regulatory takings claim and 43 U.S.C. 1752 claim are not ripe. To the extent the claim for physical taking relies on fences constructed 1981-1982, it is untimely. To the extent the physical takings claim relies on fences constructed 1988-1990, there is no evidence that water was taken that Hages could have put to beneficial use. Hages are not entitled to pre-judgment interest for range improvements because Hages failed to identify a cognizable property interest. View "Hage v. United States" on Justia Law