Justia Government Contracts Opinion Summaries

USF&G filed suit in the Court of Federal Claims under the Tucker Act, 28 U.S.C. 1491(a)(1), seeking reimbursement from the government for legal expenses and settlement costs it allegedly incurred in its capacity as general liability insurer for Gibbs Construction, a government contractor. USF&G alleged that, in a contract for renovation work at the New Orleans main post office, the U.S. Postal Service agreed to indemnify Gibbs and its agents against any liability incurred as a result of asbestos removal work under the contract. USF&G alleged that the Postal Service failed to indemnify Gibbs in connection with a lawsuit filed against Gibbs by a former Postal Service police officer, in which the officer claimed that he contracted mesothelioma as a result of asbestos removal during performance of the contract, and that, as Gibbs’s general liability insurer, it was required to litigate and settle the officer’s claim. The Federal Circuit affirmed dismissal. The Claims Court lacked jurisdiction under a theory of equitable subrogation. View "Fid. & Guar. Ins. Underwriters, Inc. v. United States" on Justia Law

A jury found Ferrell, a licensed psychologist, and Bryce, Ferrell’s employee, guilty of six counts of healthcare fraud, 18 U.S.C. 1347. Ferrell was sentenced to 88 months of imprisonment. The Seventh Circuit affirmed, upholding the district court’s refusal to admit two out-of-court statements made by Bryce’s brother (also Ferrell’s employee), and contained in a voicemail and an email. The district court held that these statements were hearsay and did not fall within Rule 804(b)(3)’s hearsay exception. The district court held that although the brother was unavailable to testify, the statements were not against his interest and the corroborating circumstances did not indicate that his statements were trustworthy. The court also upheld admission of testimony by another doctor concerning Ferrell’s conduct while in Texas. The court found that the testimony did not constitute impermissible character evidence under Fed. R. Evid. 404(b). View "United States v. Ferrell" on Justia Law

The County Assessor for Eddy County sought to use money in a county property valuation fund (as established by the Legislature in 1986) to contract with a private company for technical assistance in locating and valuing oil and gas property. The County Commission for Eddy County refused to approve the proposed plan because it believed that a contract to pay private, independent contractors to assist the County Assessor in the performance of the Assessor’s statutory duties exceeded the Commission’s lawful authority. The Supreme Court was persuaded that the County Commission did have such authority under law, and that the contract under consideration here would not have exceed that authority or be otherwise ultra vires. The district court having previously issued a declaratory judgment to that same effect, the Supreme Court affirmed. View "Robinson v. Bd. of Comm'rs of the Cty. of Eddy" on Justia Law

In 2014, the Arkansas State Highway and Transportation Department issued a bid invitation for a janitorial and cleaning-services contract. O.J.’s Service Two, Inc. submitted a bid for the contract. The Highway Department, however, awarded the contract to another bidder, RazorClean. O.J.’s protested the contract award, contending that RazorClean’s bid did not conform to the specifications in the bid invitation. The Highway Department denied O.J.’s protest. Thereafter, O.J.’s filed suit against the Highway Department and other state defendants (collectively, “Defendants”) requesting a writ of mandamus compelling Defendants to follow the Arkansas procurement laws and regulations and requiring Defendants to declare the contract with RazorClean null and void and to award the contract to O.J.’s. Defendants filed a motion to dismiss, asserting that O.J.’s claims were barred by sovereign immunity. The circuit court denied the motion. Defendants subsequently filed this interlocutory appeal. The Supreme Court dismissed the appeal as moot, holding that because the contract at issue in the lawsuit had been fully performed, the matter is now moot, and none of the exceptions to the mootness doctrine apply. View "Ark. Highway & Transp. Dep't v. O.J.’s Serv. Two, Inc." on Justia Law

In 2005 the Army Corps of Engineers invited bids on a federal reservoir project in Illinois. One of the successful bidders was Slurry, which leased from Pileco a trench cutter made by Bauer. Slurry was a prime contractor on the Corps of Engineers’ project; the Miller Act, 40 U.S.C. 3131, requires prime contractors on some government construction projects to post bonds. Slurry used Fidelity as surety. The bond insured against a failure by Slurry to pay subcontractors, such as Pileco. Contending that the cutter was defective, Slurry refused to pay the agreed rental price. Pileco sued Slurry and Fidelity, asserting breach of contract that Fidelity violated the Miller Act by failing to reimburse Pileco for costs associated with Slurry’s reneging on its obligation to pay. Slurry counterclaimed. A second trial resulted in a verdict in Pileco’s favor except for a $357,716 equitable adjustment in favor of Slurry, based on time that cutter was inoperable because of a defect attributable to Pileco. The net result was that Pileco was awarded $2.23 million against Slurry for breach of contract and the same amount against Fidelity for the Miller Act violation. The Seventh Circuit affirmed, except with respect to the denial of prejudgment interest and costs. View "Pileco, Inc. v. Slurry Systems, Inc." on Justia Law

Plaintiffs, a putative class of electrical workers, claimed that their respective employers, in collusion with Metropolitan Pier and Exposition Authority (MPEA, which used electricians supplied by the employers) wrongfully terminated them, in violation of a collective bargaining agreement (CBA) and federal labor law and circumvented the CBA-mandated hiring process and that their union, International Brotherhood of Electrical Workers, failed to adequately represent them in the CBA-mandated grievance process. The district court denied motions to dismiss four counts, but dismissed a declaratory judgment motion against MPEA and two employers, and the claim of state law tortious interference with contracts against MPEA. The district court held that, as a political subdivision, MPEA is not an “employer” under Section 301 of the Labor Management Relations Act of 1947, 29 U.S.C. 185. Plaintiffs appealed only the dismissal of the tortious interference claim against MPEA. The Seventh Circuit affirmed, rejecting an argument that jurisdiction was created by the need to interpret the CBA. With respect to political subdivisions, section 301 preempts not only claims “founded directly” on the collective bargaining agreement, but also state law claims that indirectly implicate a collective bargaining agreement. View "Healy v. Metro. Pier & Exposition Auth." on Justia Law

The U.S. Air Force solicited bids from private companies to supply equipment and services to build a new radar system. Raytheon, Northrop Grumman, and Lockheed Martin cleared early hurdles; each received a solicitation for proposals for Engineering and Manufacturing Development. The Air Force subsequently sent Evaluation Notices to Raytheon and Northrop that “contractors would not be permitted to use IR & D costs to reduce their costs of performing . . . if those costs were implicitly or explicitly required for contract performance.” Raytheon objected; Northrop did not.. The Air Force then changed its view and accepted Raytheon’s treatment of certain costs as IR & D costs, but never communicated its new view to Northrop. In final proposals, Raytheon proposed IR & D cost reductions, whereas Northrop did not. The Air Force awarded the contract to Raytheon. Northrop and Lockheed filed protests with the Government Accountability Office (31 U.S.C. 3551). In response, the Air Force “decided to take corrective action” and to reopen discussions. Raytheon filed a protest under 28 U.S.C. 1491(b) to challenge the decision to take corrective action. The Federal Circuit affirmed denial of the protest, concluding that the reopening decision was proper based on the disparate-information violation. View "Raytheon Co. v. United States" on Justia Law

Appellant, the Greater Boise Auditorium District, filed a petition for judicial confirmation (pursuant to Idaho Code section 7-1304) asking the district court for a determination that a lease the District intended to enter into did not violate the Constitution’s Article VIII, section 3 clause prohibiting a municipal body, without voter approval, from incurring indebtedness or liabilities greater than it has funds to pay for in the fiscal year. Respondent, Boise resident and property owner David Frazier, objected to the requested judicial confirmation, and appeared in the case to contest it. The district court denied the Petition for Judicial Confirmation and the District appealed. Frazier sought attorneys’ fees on appeal. After review, the Supreme Court reversed the district court’s denial of the District’s request for judicial confirmation and held that the agreements into which it entered satisfied Article VIII, section 3 of the Constitution. View "Greater Boise Auditorium District v. Frazier" on Justia Law

Trona is a sodium carbonate compound that is processed into soda ash or baking soda. Because oil and gas development posed a risk to the extraction of trona and trona worker safety, the Bureau of Land Management (BLM), which manages the leasing of federal public land for mineral development, indefinitely suspended all oil and gas leases in the mechanically mineable trona area (MMTA) of Wyoming. The area includes 26 pre-existing oil and gas leases owned by Barlow. Barlow filed suit, alleging that the BLM’s suspension of oil and gas leases constituted a taking of Barlow’s interests without just compensation and constituted a breach of both the express provisions of the leases and their implied covenants of good faith and fair dealing. The Federal Circuit affirmed the Claims Court’s dismissal of the contract claims on the merits and of the takings claim as unripe. BLM has not repudiated the contracts and Barlow did not establish that seeking a permit to drill would be futile. View "Barlow & Haun, Inc. v. United States" on Justia Law

Mike Layer built a sewer pumping station for Barrow County, and he allegedly entered into an agreement with the County pursuant to which he would retain an interest in a portion of the pumping capacity at the station. Layer, however, failed to get this alleged agreement in writing. After he was refused his alleged interest in the pumping capacity, Layer sued Barrow County, the City of Auburn, and a host of county and city officials (in both their official and individual capacities), asserting breach of contract, unjust enrichment, breach of the implied covenant of good faith and fair dealing, promissory estoppel, and an unconstitutional taking of his property without just compensation. The trial court dismissed his lawsuit, and Layer appealed. Finding no reversible error, the Supreme Court affirmed. View "Layer v. Barrow County" on Justia Law