Justia Government Contracts Opinion Summaries

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

Lakeview Excavating appealed a district court judgment dismissing its complaint against Dickey County and German Township (Defendants) for breach of contract, intentional fraud, and misrepresentation. In spring 2012, the Defendants awarded to Lakeview three road construction project contracts funded by the Federal Emergency Management Agency (FEMA). The parties executed three identical contracts, one for each project. The contracts required Lakeview to provide the necessary documents to satisfy FEMA requirements for funding. Lakeview had to use more material than was listed in the bid documents to complete the projects. Some of the material used by Lakeview was taken from private property without permission and resulted in litigation against Lakeview. Lakeview completed the road construction projects in August 2012. In October 2016, Lakeview sued the Defendants for breach of contract, fraud, misrepresentation, and unlawful interference with business. The court ruled Lakeview breached its contracts with the Defendants, and held Lakeview’s tort claims against the Defendants were barred by the statute of limitations. Lakeview appealed, but finding no reversible error, the North Dakota Supreme Court affirmed. View "Lakeview Excavating, Inc. v. Dickey County, et al." on Justia Law

The VA issued Requests for Proposals (RFP) for the provision of healthcare furniture and related services for VA facilities for five geographic regions. The RFP described a best-value tradeoff selection process that considered three primary evaluation factors: Technical Capability, Past Performance, and Price. Technical Capability was more important than Past Performance and Past Performance more important than Price. Technical Capability subfactor 3 specified that an offeror’s technical proposal must include specific elements. The RFP noted that an “unacceptable” rating for any technical subfactor would result in an overall “unacceptable” technical proposal. An offeror with an unacceptable Technical Capability subfactor was ineligible for a contract award.The VA assigned ODG's bid an unacceptable rating for its technical proposal, noting that it was only able to locate responses to six of the 33 questions in Attachment 15, resulting in a failing score of 12 points. The VA explained that ODG’s technical proposal “lacked detail” and failed to address seven service requirements. Each of the awardees earned at least 40 points for its technical proposal. ODG filed a bid protest. The Claims Court and Federal Circuit upheld the VA’s actions, rejecting arguments that the VA unreasonably and disparately evaluated ODG's technical proposal in comparison to the awardees’ technical proposals and improperly relied on Attachment 15 to evaluate its technical proposal. View "Office Design Group v. United States" on Justia Law

Care Alternatives provides hospice care to New Jersey patients, employing “interdisciplinary teams” of registered nurses, chaplains, social workers, home health aides, and therapists working alongside independent physicians who serve as hospice medical directors. Former Alternatives employees filed suit under the False Claims Act, 31 U.S.C. 3729–3733 alleging that Alternatives admitted patients who were ineligible for hospice care and directed its employees to improperly alter those patients’ Medicare certifications to reflect eligibility. They retained an expert, who opined in his report that, based on the records of the 47 patients he examined, the patients were inappropriately certified for hospice care 35 percent of the time. Alternatives’ expert testified that a reasonable physician would have found all of those patients hospice-eligible. The district court determined that a mere difference of opinion between experts regarding the accuracy of the prognosis was insufficient to create a triable dispute of fact as to the element of falsity and required that the plaintiffs provide evidence of an objective falsehood. Upon finding they had not adduced such evidence, the court granted Alternatives summary judgment. The Third Circuit vacated, rejecting the objective falsehood requirement for FCA falsity. The plaintiffs’ expert testimony created a genuine dispute of material fact as to falsity. View "Druding v. Care Alternatives" on Justia Law

The Supreme Court reversed the decision of the district court granting summary judgment in favor of Plaintiffs in this action seeking to recover delinquent contributions to various trust funds for construction on a state construction project, holding that the right of action under a payment bond statute extends to any amount due an employee, meaning any amount that is traceable specifically to an employee.One of the subcontractors hired to work on the project failed to make contributions to various trust funds for its employees' work on the project, as required by trust agreements and a collective bargaining agreement. The trusts (Plaintiffs) sought to recover the delinquent contributions from the public payment bond associated with the project by suing Defendant, the surety for the payment bond. The district court granted summary judgment for Plaintiffs. On appeal, the parties disputed whether Utah Code 63G-6-505(4) limits the right of action on a payment bond to amounts due to an employee or encompasses claims for any amounts due for an employee or on the employee's behalf. The Supreme Court reversed, holding that the right of action under the public payment bond statute contemplates recovery of any specific benefit that is due a person in the sense of being traceable to that person. View "McDonald v. Fidelity & Deposit Co. of Maryland" on Justia Law

Plaintiffs, current and former alien detainees, filed a class action under the Trafficking Victims Protection Act (TVPA) and Georgia law, alleging that CoreCivic, a private contractor which owns and operates the Stewart Detention Center, coerces alien detainees to perform labor at the detention center by, inter alia, the use or threatened use of serious harm, criminal prosecution, solitary confinement, and the withholding of basic necessities.The Eleventh Circuit affirmed the district court's denial of CoreCivic's motion to dismiss the complaint and held that the TVPA applies to private for-profit contractors operating federal immigration detention facilities. Specifically, the court held that, under the plain language of the statute, the TVPA covers the conduct of private contractors operating federal immigration detention facilities; the TVPA does not bar private contractors from operating the sort of voluntary work programs generally authorized under federal law for aliens held in immigration detention facilities; but private contractors that operate such work programs are not categorically excluded from the TVPA and may be liable if they knowingly obtain or procure the labor or services of a program participant through the illegal coercive means explicitly listed in the TVPA. View "Barrientos v. CoreCivic, Inc." on Justia Law

The Supreme Court reversed the order of the circuit court denying the City of Fort Smith's motion to compel class notice on Plaintiff's claims alleging illegal exaction and unjust enrichment against on the ground that the City waived notice by moving for summary judgment prior to class certification and notice, holding that the circuit court erroneously interpreted National Enterprises, Inc. v. Kessler, 213 S.W.3d 597 (Ark. 2005).Plaintiff alleged that the City misused public funds from the City's curbside residential recycling program. Twelve days after her complaint was filed Plaintiff moved for class certification. The City responded to the class certification motion and, separately, moved for summary judgment. The circuit court then certified the same class for both claims and, three months later, denied the City's motion for summary judgment. The City later filed its motion to compel class notice. The circuit court held that, under Kessler, the timing of the City's motion for summary judgment waived notice even though the motion was ultimately successful. The Supreme Court reversed, holding that the circuit court's decision was premised on an erroneous interpretation of the Supreme Court's decision in Kessler. View "City of Fort Smith v. Merriott" on Justia Law

After Phelps was awarded a public works contract by the CDCR, another bidder successfully challenged the award, obtaining a ruling in a San Diego trial court that Phelps's bid was "non-responsive as a matter of law" due to its inclusion of "non-waivable mathematical/typographical errors." Phelps then filed suit against CDCR, seeking to recover the costs it expended on the project. The trial court held that the San Diego trial court's ruling was itself the result of a defect in the competitive bidding process caused solely by CDCR, and entered judgment in favor of Phelps.The Court of Appeal reversed, holding that judgment on the pleadings should have been granted. The court held that the language in Public Contract Code section 5110 provides that the parties to a challenged public contract may enter into that contract pending final resolution of the challenge, but if the challenge is resolved by invalidation because the public entity was at fault, the contractor may recover. Applying section 5110 in this case, the court held that the contract was invalidated for a material error in Phelps's bid, not for any defect in the competitive bidding process, much less a defect caused solely by CDCR. Therefore, section 5110 could not provide a basis for recovery. The court held that application of the doctrine of collateral estoppel would produce the same result, and rejected Phelps's late-raised alternative ground. However, the court affirmed the trial court's denial of recovery on CDCR's cross-complaint for disgorgement. View "Hensel Phelps Construction Co. v. Department of Corrections and Rehabilitation" on Justia Law

Upon reconsideration of the scope of the revised Federal Officer Removal Statute, the en banc court held that Avondale was entitled to remove this negligence case filed by a former Navy machinist because of his exposure to asbestos while the Navy's ship was being repaired at the Avondale shipyard under a federal contract.The en banc court aligned with its sister circuits and relied on the plain language of the Removal Clarification Act of 2011, holding that, to remove under 28 U.S.C. 1442(a), a defendant must show (1) it has asserted a colorable federal defense, (2) it is a "person" within the meaning of the statute, (3) that has acted pursuant to a federal officer's directions, and (4) the charged conduct is connected or associated with an act pursuant to a federal officer's directions. In this case, the pleadings satisfied the "connection" condition of removal. Accordingly, the en banc court vacated and remanded for further proceedings. View "Latiolais v. Huntington Ingalls, Inc." on Justia Law

The Fifth Circuit affirmed the district court's grant of summary judgment to the United States in a False Claims Act (FCA) suit alleging that BestCare obtained millions of dollars in reimbursements from Medicare for miles that its technicians never traveled. The court held that the district court did not err in granting the Government's motions for summary judgment where BestCare violated the Medicare statute's limitations on travel reimbursements. Furthermore, the court rejected BestCare's alternative argument that their good-faith reliance on the CMS Manual created a genuine dispute about whether they had the requisite mental state to violate the FCA. Because the court affirmed the $30.6 million award under the FCA, defendant's challenge to the $10.6 million award was moot. Finally, the district court did not err in holding Defendant Maghareh jointly and severally liable, and defendants' claim that the district court should be recused under 28 U.S.C. 455 lacked merit. View "United States ex rel. Drummond v. BestCare Laboratory Services, LLC" on Justia Law