Justia Government Contracts Opinion Summaries

More than 70 years ago, two railroad companies helped the United States Atomic Energy Commission build a track to the Hanford Nuclear Reservation in return for the right to use the track without paying rent. After the nuclear reactors at Hanford were decommissioned, the United States transferred nearly 800 acres, including the track at issue, to the Port of Benton (Port), subject to existing agreements and potential reversion to the United States if certain conditions were not met. The Port continued to honor the agreements and operate the railroad. The Port’s decision not to charge rent was challenged by a taxpayer, Randolph Peterson, as an unconstitutional gift of public funds. This challenge was dismissed at summary judgment. After review of the trial court record, the Washington Supreme Court found no constitutional violation and affirmed dismissal. View "Peterson v. Dep't of Revenue" on Justia Law

Restore was asked to mitigate and repair significant fire damage at Proviso East High School, having provided similar service to the District in the past. The District’s customary practice when contracting for repair and payment of losses covered by insurance was to proceed without a recorded vote of its Board. The fire loss was covered by insurance. The District’s superintendent executed contracts with Restore.The District was subject to the School District Financial Oversight Panel (FOP) and Emergency Financial Assistance Law (105 ILCS 5/1B-1) and the Financial Oversight Panel Law (105 ILCS 5/1H-1). The FOP’s chief fiscal officer attended construction meetings and approved numerous subcontracts, quotations, bids, sales orders, change orders, and invoices. Although there was no recorded vote, “a majority of the Proviso Board knew and informally approved" the work. Restore was paid by the insurers for all but $1,428,000. Restore sued, seeking recovery from the District based on quantum meruit. The District argued that it had no obligation to pay because the contracts had not been let out for bid and approved by a majority vote as required by the School Code (105 ILCS 5/1-1).The Illinois Supreme Court affirmed the reinstatement of the case following dismissal. The failure of a governmental unit to comply with required contracting methods is not fatal to a plaintiff’s right to recover based on quasi-contract or implied contract principles. The Board was subject to the FOP; the FOP was fully apprised of and approved the work. Any misconduct was on the part of the Board; allowing Restore to recover presents no “risk of a raid on the public treasury.” View "Restore Construction Co., Inc. v. Board of Education of Proviso Township High Schools District 209" on Justia Law

The Army sought to procure the services of certified registered nurse anesthetists for the Fort Bragg Army Medical Center. Eskridge bid but the solicitation was canceled. A new solicitation received 18 timely, complete proposals. Eskridge filed a pre-award protest with the Government Accountability Office (GAO), alleging that the Army “acted in bad faith” by failing to include language allegedly agreed-upon following the cancellation. Eskridge withdrew its protest after the Army responded. Eskridge’s bid was not ranked among the five lowest proposals. The Army awarded the contract to Ansible as the lowest-priced, technically acceptable proposal. Eskridge filed another protest. The Army indicated it would “better document the selection” and reviewed the 10 lowest-priced bidders on technical and past performance bases. Of the five technically acceptable bidders, Eskridge bid the highest total price. The Army awarded the Contract to Ansible. Eskridge filed a post-award protest.The GAO and the Claims Court dismissed Eskridge’s claims, finding Eskridge had no substantial chance of winning the Contract and that the claimed errors would affect each of the five lowest-priced, technically acceptable proposals equally. The Federal Circuit affirmed. Eskridge does not possess a direct economic interest. The relevant inquiry is whether the bidder “establish[ed] not only some significant error in the procurement process but also that there was a substantial chance it would have received the contract award but for that error.” The court found no error in the Army’s compensation realism analysis. View "Eskridge & Associates v. United States" on Justia Law

The Supreme Court affirmed the judgment of the circuit court in favor of Excel Underground, Inc. on its breach of contract claim against the Brant Lake Sanitary District, holding that the circuit court did not err in any of its challenged rulings.The District contracted with Schmitz, Kalda, and Associates, Inc. (SKA) to engineer a sewer system and with Excel to install it. After delays, the District terminated Excel's contract. The District and Excel subsequently sued each other for breach of contract. The District also filed a third-party complaint against SKA for contribution and indemnity. Prior to trial, the trial court granted Excel's motion to dismiss the District's claim for liquidated damages and dismissed SKA from the suit. After a jury trial, the jury returned a verdict in favor of Excel. The Supreme Court affirmed, holding (1) the circuit court did not err by dismissing the District's claim for liquidated damages; (2) despite any error in the district court's instruction that SKA was the District's agent, the District failed to establish prejudice; (3) the circuit court did not err by allowing testimony regarding the District's emergency bidding procedures; and (4) the evidence was sufficient to support the jury's damage award. View "Excel Underground, Inc. v. Brant Lake Sanitary District" on Justia Law

The VA issued a contract to OPSS for developing and managing the VA’s program to provide veterans access to community-based healthcare in Region 3 of the WellPoint, an unsuccessful bidder, brought a bid protest action. The Claims Court found that the VA conducted a reasonable best value determination, denied WellPoint’s request for injunctive relief, and dismissed WellPoint’s bid protest challenge. The Federal Circuit affirmed. The VA’s methodology for evaluating price in connection with this procurement was both reasonable and in accordance with the terms of the Solicitation. The court noted the three levels at which the proposals were evaluated and found no showing that alleged errors in first-tier revies carried over to the final decision. Even if an error had been carried over, WellPoint has not demonstrated that “but for the error, it would have had a substantial chance of securing the contract.” View "WellPoint Military Care Corp. v. United States" on Justia Law

Oakland requested proposals for franchise contracts regarding garbage and residential recycling services. Following a lawsuit, a settlement provided that WMAC would receive garbage and mixed materials and organics contracts; CWS would receive the residential recycling contract. WMAC and CWS agreed to pay franchise fees to the city, which redesignated part of WMAC’s franchise fee as a fee to compensate the city for the cost of implementing the Alameda County Waste Management Plan, under Public Resource Code 41901. Plaintiffs challenged the fees as improperly imposed taxes under the California Constitution, article XIIIC.The court of appeal affirmed the dismissal of claims concerning the Redesignated Fee as not ripe for adjudication but reversed dismissal as to the franchise fees. A franchise fee, arguably subject to an article XIIIC, section 1(e) exemption, must still be reasonably related to the value of the franchise to be exempt from the “tax” definition. The court cited Proposition 26: To qualify as a nontax ‘fee’ under article XIII C, as amended, a charge must satisfy both the requirement that it be fixed in an amount that is ‘no more than necessary to cover the reasonable costs of the governmental activity,’ and the requirement that ‘the manner in which those costs are allocated to a payor bear a fair or reasonable relationship to the payor’s burdens on, or benefits received from, the governmental activity. View "Zolly v. City of Oakland" on Justia Law

In this case concerning the scope of the Expedited Declaratory Judgment Act (EDJA), the Supreme Court held that the EDJA gives the trial court jurisdiction to declare whether the execution of contracts entered into by the San Jacinto River Authority to sell water to cities and other customers was legal and valid but not whether the Authority complied with the contracts in setting specific rates.The Authority, which used the revenue from the contracts to pay off its bonds, sought declarations regarding the contract and the specific water rates set forth pursuant to the contracts. Several cities filed pleas to the jurisdiction, arguing that the trial court lacked subject matter jurisdiction to adjudicate SJRA's claims under the EDJA. The trial court denied the pleas to the jurisdiction. On appeal, the court of appeals held primarily for the Authority. The Supreme Court reversed in part, holding (1) the trial court may exercise jurisdiction over the Authority's execution of the contracts - which met the statutory definition of "public security authorization" - but may not exercise jurisdiction over whether the Authority complied with the contracts in setting the water rates; and (2) the Cities' governmental immunity did not bar this EDJA suit, which was brought in rem to adjudicate interests in property. View "City of Conroe, Texas v. San Jacinto River Authority" on Justia Law

An unsuccessful bidder on managed-care contracts for MississippiCAN, the state’s managed-care program, argued that the Division of Medicaid and its executive director violated multiple statutes and regulations in procuring the contracts. Mississippi True appealed the decision of the chancery court affirming the Division of Medicaid’s award of the contracts to three other companies and the chancery court’s order denying its motion to sever and transfer its damages claims to circuit court. The Mississippi Supreme Court "thoroughly reviewed the voluminous record" and concluded that Mississippi True has failed to prove any basis for reversal. "The decision of the DOM was supported by substantial evidence, was not arbitrary or capricious, was not beyond the DOM’s power to make, and did not violate Mississippi True’s statutory or constitutional rights." View "Mississippi True v. Dzielak et al." on Justia Law

The 1961 National Housing Act provided financial incentives to private developers to build low-income housing, including below-market mortgages insured by HUD. Participating developers had limited ability to increase rents while HUD insured the mortgage. The mortgage term was 40 years but developers could prepay their mortgages after 20 years and convert to market-rate housing. The 1988-1990 Preservation Statutes eliminated the prepayment option, 12 U.S.C. 4101. The 1996 Housing Opportunity Program Extension Act restored prepayment rights to developers still in the program.Four “first wave plaintiffs” (FWPs) owned their properties before the Preservation Statutes and sold after their enactment, consistent with the 1990 Low-Income Housing Preservation and Resident Homeownership Act (LIHPRHA) to organizations that preserved the rent restrictions. One FWP owned its property before the Preservation Statutes and remained in the program, obtaining HUD financial incentives in exchange for abiding by the restrictions for the property's "remaining useful life.” The final FWP (Casa) purchased its property in 1991 and sold pursuant to LIHPRHA. The FWPs alleged regulatory taking. The Claims Court applied the “Penn Central” three-factor test and rejected the claims on summary judgment.The Federal Circuit affirmed with respect to Casa, a sophisticated investor that voluntarily purchased its property with knowledge that it had no prepayment option and had no reasonable investment-backed expectation. The court otherwise vacated. The character of the governmental action and the investment-backed expectations weighed against summary judgment and the Claims Court did not consider certain genuine issues of fact regarding the calculations of economic impact. View "Anaheim Gardens, L.P. v. United States" on Justia Law

Taxi companies and taxi medallion owners sued Uber, alleging violations of the Unfair Practices Act’s (UPA) prohibition against below-cost sales (Bus & Prof. Code, 17043) and of the Unfair Competition Law (section 17200). The UPA makes it unlawful “for any person engaged in business within this State to sell any article or product at less than the cost thereof to such vendor, or to give away any article or product, for the purpose of injuring competitors or destroying competition” but does not apply “[t]o any service, article or product for which rates are established under the jurisdiction of the [California] Public Utilities Commission [(CPUC)] . . . and sold or furnished by any public utility corporation.” Uber is a “public utility corporation” under section 17024 and is subject to CPUC’s jurisdiction. CPUC has conducted extensive regulatory proceedings in connection with Uber’s business but has not yet established the rates for any Uber service or product.The trial court ruled the exemption applies when the CPUC has jurisdiction to set rates, regardless of whether it has yet done so, and dismissed the case. The court of appeal affirmed, reaching “the same conclusion as to the applicability of section 17024(1) as have three California federal district courts, two within the last year, in cases alleging identical UPA claims against Uber.” View "Uber Technologies Pricing Cases" on Justia Law