Justia Government Contracts Opinion Summaries

The Medicare program pays teaching hospitals to cover "direct" and "indirect costs of medical education," 42 U.S.C. 1395ww(d)(5)(B), (h). Direct costs include expenses such as residents' salaries. Indirect costs are incurred due to "general inefficiencies" and "extra demands placed on other staff." Congress created a formula for calculating indirect expenses based on full-time equivalency interns; an HHS regulation referred to time residents spend in the "portion of the hospital subject to the prospective payment system or in the outpatient department of the hospital." In reimbursing plaintiff, HHS excluded from the FTE count time residents spent on pure research, unrelated to treatment of a patient. While appeal of a decision favoring the hospital was pending, Congress enacted the Patient Protection and Affordable Care Act, 124 Stat. 119, 660–61. For the years at issue, HHS must include in FTE: "all the time spent by an intern or resident in an approved medical residency training program in non-patient care activities, such as didactic conferences and seminars, as such time and activities are defined by the Secretary." HHS promulgated a regulation specifying that eligible non-patient care activities do not include time residents spend conducting pure research. The Sixth Circuit upheld the regulation as within the Secretary's authority and applicable to the years at issue. View "Henry Ford Health Sys. v. Dept. of Health & Human Servs." on Justia Law

Plaintiff-Appellant Dawn Bunch brought suit under 42 U.S.C. 1983 alleging that Defendant Independent School District No. I-050 of Osage County (Prue Public Schools) violated her First and Fourteenth Amendment rights. She appealed a district court's grant of summary judgment in favor of the District in which the court concluded Plaintiff had no protected property interest in her employment and failed to show her speech was a motivating factor for her termination. An internal investigation found that Plaintiff “either [. . .] wasn’t properly trained or she was not doing her job as required.” The School Board in an open session, but without holding a due-process hearing, terminated Plaintiff's employment. Plaintiff's complaint claimed a property interest in her employment contract entitled her to a hearing before her employment was terminated. She also alleged the termination was in retaliation for her exercise of free speech rights because, earlier that fall, she had signed a state-court petition calling for a grand jury investigation into the activities of Board members, and she had complained to friends and family about the Board. Upon review of the trial court's record and the applicable authority, the Tenth Circuit found that Plaintiff's proffered evidence of discrimination did not amount to the requisite proof that her civil and constitutional rights were violated. The Court affirmed the lower court's grant of summary judgement in favor of the District. View "Bunch v. Ind. Sch. Dist. No. I-050 of Osage Cty." on Justia Law

Plaintiff-Appellant Louanne Cypert brought suit under 42 U.S.C. 1983 and several anti-discrimination statutes alleging that Defendant Independent School District No. I-050 of Osage County's (Prue Public Schools) failure to renew her employment contract violated her First and Fourteenth Amendment rights. Specifically, Plaintiff claimed the District discriminated against her because of her age. The district court granted the District summary judgment, finding that Plaintiff's non-renewal hearing satisfied her Fourteenth Amendment claim to due process, and that she failed to show her speech was the motivating factor that led to the District's non-renewal, and that she failed to show the District's non-renewal resulted from discrimination. In the fall of 2008, the local School Board became concerned about the District’s finances. It initiated an investigation and began terminating employment contracts. Plaintiff's contract was one of the terminated contracts. On appeal, Plaintiff proffered evidence of the Board's keeping younger, lesser-qualified personnel on staff at the time of her termination. Upon review of the trial court's record and the applicable authority, the Tenth Circuit found that Plaintiff's proffered evidence of discrimination did not amount to the requisite proof that her civil and constitutional rights were violated. The Court affirmed the lower court's grant of summary judgement in favor of the District. View "Cypert v. Ind. Sch. Dist. No. I-050 of Osage Cty." on Justia Law

In 1993, the FAA decided to privatize all Level I air traffic control towers. About 1500 controllers were forced to leave the field, be trained to operate higher level towers, or secure employment with the private contractors. Office of Management and Budget Circular A-76 prohibits the federal government from performing an activity that could be performed for less cost by the private sector. Before privatizing a function, an agency must determine whether that function is inherently governmental or commercial. A governmental function must be performed by government employees. The district court first dismissed, but, on remand, instructed the FAA to undergo Circular A-76 analysis. The FAA continued to privatize towers and controllers again brought suit. The district court again remanded to the FAA for analysis, but refused to terminate private contracts already in place. The court later granted the FAA partial summary judgment, based on a 2003 amendment to 49 U.S.C. 47124, indicating that work in Level I towers is not an inherently governmental function, then dismissed remaining claims for lack of standing. The Sixth Circuit affirmed. Every tower privatized in the 1993 program fit within the section 47124(b)(3) mandate. View "Nat'l Air Traffic Controllers Ass'n v. Sec'y of the Dep't. of Transp." on Justia Law

Based on her part in billing Indiana Medicaid for ambulance service while running a car service to take patients to medical appointments, defendant was convicted of Medicaid fraud, 18 U.S.C. 1347, and conspiracy to defraud the U.S. government, 18 U.S.C. 371. She was sentenced to 33 months in prison and to pay restitution of $846,115. The Seventh Circuit affirmed. Data relating to time-stamping of bills, which may have established that multiple people submitted bills, was not concealed; the government simply failed to extract (before trial) information to which it and the defense had access. Even if the data was "Brady" material, it would not have changed the outcome. The judge did not err in telling the jury that a scheduled witness was ill without saying that the witness had refused treatment. View "United States v. Gray" on Justia Law

A contractor, renovating military housing, obtained a performance bond under the Miller Act (40 U.S.C. 3131 (b)) and abandoned the project after completing 12 percent of the work. The government had paid 40 percent of the contract price. The surety contracted for completion, but the second contractor discovered code violations and incurred penalties for late completion. Costs were reimbursed by the surety, which filed suit under the Tucker Act, 28 U.S.C. 1491. The Federal Circuit held that the Claims Court lacked jurisdiction. The court previously held that the Claims Court has jurisdiction under the Act over sureties' claims based on a theory of equitable subrogation; this case does not involve equitable subrogation because the government made payments at issue before receiving notice of the contractor's default. The waiver of sovereign immunity under the Act does not extend to impairment of suretyship claims apart from the theory of equitable subrogation. The Contract Disputes Act, 41 U.S.C. 601, applies to a surety's claim against the government arising from a takeover agreement between the government and surety for completion of a bonded contract following the principal obligor’s default; the surety failed to satisfy CDA jurisdictional prerequisites. View "Lumbermens Mut. Cas. Co. v. United States" on Justia Law

This case arose from the tragic February 2007 crash of an Army Special Operations Aviation Regiment helicopter in Afghanistan. Plaintiffs, who include those injured and the heirs of those killed in the crash, appealed from the district court's dismissal of AT Engine Controls (ATEC) for lack of personal jurisdiction and from the court's summary judgment in favor of The Boeing Company (Boeing), Honeywell International, Inc. (Honeywell), and Goodrich Pump and Engine Control (Goodrich) (collectively, contractors). The court considered each of plaintiffs' arguments challenging the district court's dismissal of ATEC for lack of personal jurisdiction and its summary judgment in favor of the contractors, finding none of these arguments persuasive. The court also held that because the government contractor defense barred each of plaintiffs' state-law claims, the court need not consider the contractors' alternative argument, based on the combatant activities exception, for upholding the district court's summary judgment. Accordingly, the judgment of the district court was affirmed. View "Getz, et al. v. The Boeing Company, et al." on Justia Law

The City of Newkirk and Kay Electric Cooperative both provide electricity to Oklahoma consumers. "When a city acts as a market participant it generally has to play by the same rules as everyone else. It can't abuse its monopoly power or conspire to suppress competition. Except sometimes it can. If the city can show that its parent state authorized it to upend normal competition [. . . ] the city enjoys immunity from federal antitrust liability. The problem for the City of Newkirk in this case is that the state has done no such thing." Kay sued Newkirk alleging that the City engaged in unlawful tying and attempted monopolization in violation of the Sherman Act, 15 U.S.C. 1,2. The district court refused to allow the case to proceed, granting Newkirk's motion to dismiss after it found the City "immune" from liability as a matter of law. Upon review, the Tenth Circuit found that the state did not authorize Newkirk to enter the local electricity market as it did in this case. The Court reversed the district court and remanded the case for further proceedings. View "Kay Electric Cooperative v. City of Newkirk" on Justia Law

The qui tam suit, brought by a former contractor for one of the defendants, alleges that defendants violated the False Claims Act, 31 U.S.C. 3729(a)(1) in connection with a sale of F-16 fighter jets to Greece, which paid for the jets with money borrowed from the United States. The district court granted summary judgment in favor of defendants. The Seventh Circuit affirmed. An FCA claim requires proof of an objective falsehood. There was no evidence to support allegations: that defendant lied about use of funds loaned by the U.S. to capitalize a Greek business development company; that defendant failed to disclose promptly its decision to delete a price adjustment clause from the draft contract; that defendant made misrepresentations relating to provisions concerning spare part purchases and an ill-fated "depot program;" and concerning a number of misrepresentations in two amendments to the contract. View "Yannacopoulos v. Gen. Dynamics" on Justia Law

The United States Army Corps of Engineers awarded the company a contract for construction of a government hospital at Fort Benning. Two rival bidders each filed a bid protest with the Government Accountability Office, which recommended that the contract be re-procured without the company's participation. The GAO found organizational conflict of interest, focusing on the potential for access to nonpublic information and had concluding that the company had access to special knowledge of the Army's requirements that would give unfair advantage. The Army announced that it would follow the GAO recommendation and terminated the contract. The Court of Claims ordered reinstatement and the Federal Circuit affirmed. The Claims Court applied the correct standard of review in concluding that the termination was unreasonable. Th GAO identified no facts to indicated that the company actually had access to specific, sensitive information. View "Turner Constr. Co., Inc. v. United States" on Justia Law