Justia Government Contracts Opinion Summaries

The Forest Service awarded EM Logging a timber sale contract for the Kootenai National Forest in Montana. The contract’s load limit clause states that “[a]ll vehicles shall comply with statutory load limits unless a permit from the Forest Service and any necessary State permits are obtained,” the haul route clause states that “[a]ll products removed from Sale Area shall be transported over the designated routes of haul” and a notification clause requires that “Purchaser shall notify Forest Service when a load of products … will be delayed for more than 12 hours in reaching weighing location.” The provision under which the Forest Service terminated the contract refers to: “a pattern of activity that demonstrates flagrant disregard for the terms of this contract.” The Forest Service issued multiple notifications of breach with respect to the clauses, suspended operations, and terminated the contract. The Federal Circuit reversed, finding that one instance of route deviation necessitated by illness, one load limit violation, and two instances of delayed notifications. None of the alleged violations independently substantiated the finding of flagrant disregard. Even together, the violations were not substantial evidence of a pattern of activity demonstrating that EM’s actions were in flagrant disregard of the contract. View "EM Logging v. Dep't of Agric." on Justia Law

Since 1962, Athens has been the exclusive residential waste hauling franchisee for Montebello. In 2008, a candidate for the City Council approached Athens about becoming the city’s exclusive commercial waste hauling franchisee. The candidate won election and the Council approved a contract granting Athens an exclusive residential and commercial waste hauling franchise. The Mayor, who had voted against the exclusive franchise, refused to sign the contract. The City Attorney advised the Mayor that he had a ministerial duty to execute contracts passed by the Council under Government Code 40602. If the Mayor refused to do so, the City Attorney warned, he would be deemed “absent” under Government Code 40601 and the Mayor Pro Tempore would be directed to execute the contract in his stead. Weeks passed without the Mayor signing the contract, until, at the apparent direction of the City Attorney, the Mayor Pro Tempore signed it. Torres sought to invalidate the contract. The trial court found the contract void ab initio because it had not been executed by the Mayor. The court of appeal affirmed; neither the City Attorney nor the Mayor Pro Tempore had authority to deem the Mayor “absent” under the statute, so the signature was ineffective. View "Torres v. City of Montebello" on Justia Law

In 2004, K-Con entered into a contract with the federal government to construct a Coast Guard building in Port Huron Michigan for $582,641. Once K-Con finished, the government imposed liquidated damages of $109,554 for tardiness of 186 days in completion. KCon sued, seeking remission of the liquidated damages on two grounds—that the contract’s liquidated-damages clause was unenforceable and that KCon was entitled to an extension of the completion date. KCon also requested additional compensation based on work performed in response to government requests that K-Con alleges amounted to contract changes. The Court of Federal Claims held that the contract’s liquidated damages clause was enforceable; that K-Con did not comply with the written-notice precondition for invoking the contract clause governing changes; and that K-Con’s claim for an extension on the completion date must be dismissed for lack of jurisdiction. The Federal Circuit affirmed. K-Con failed to comply with the changes clause, and its after-the-fact speculations about what would have happened had it complied do not create a genuine dispute of material fact regarding whether it should be excused for its failure. View "K-Con Bldg. Sys., Inc. v. United States" on Justia Law

Alabama Mutual Insurance Corporation ("AMIC") appealed the trial court's order certifying a class in the action filed by the City of Vernon and a class of similarly situated entities that had purchased uninsured motorist/underinsured-motorist coverage ("UM/UIM coverage") from AMIC. Vernon was the original class representative; however, after AMIC filed its notice of appeal of the class-certification order, Vernon settled its claims against AMIC and withdrew as the class representative. Because there was no longer a representative to "fairly and adequately protect the interests of the class," the Supreme Court remanded the case back to the trial court for a new class representative to be substituted for Vernon. The City of Fairfield substituted for Vernon as the class representative. After review of the parties' arguments on appeal, the Supreme Court did not reach the merits of the underlying dispute: the Court concluded that the trial court lacked subject-matter jurisdiction over this dispute. Initial jurisdiction over this dispute was with the Alabama Department of Insurance and its commissioner. Therefore, the Supreme Court vacated the trial court's class-certification order, and remanded for dismissal. View "Alabama Mutual Insurance Corporation v. City of Fairfield" on Justia Law

Rosaura Building Corp. (“Rosaura”) filed a lease contract petition form offering its building as property for Head Start classrooms. The Mayor of the Municipality of Mayguez rejected the contract. Rosaura brought a civil rights claim for equitable relief and damages pursuant to 42 U.S.C. 1983 against the Mayor and the municipal government (collectively, “Defendants”), claiming that Defendants’ rejection of the contract was solely motivated by Rosaura’s political beliefs. The district court granted summary judgment in favor of Defendants. The First Circuit affirmed, holding that the district court (1) did not err in granting the dismissal of the claims against the Municipality, as there was no practical effect in dismissing the claims against the municipal government where a mayor’s “employment decisions ipso facto” constitute the official policy of the municipality; and (2) did not err in dismissing the claims against the Mayor in his official capacity, as Rosaura failed to state a First Amendment retaliation cause of action and failed to state an equal protection claim by not alleging what protected activity it exercised and was a substantial motivating factor in bringing about the Mayor’s purported retaliation. View "Rosaura Building Corp. v. Municipality of Mayaguez" on Justia Law

Relator appealed the district court's dismissal of her qui tam action under the False Claims Act (FCA), 31 U.S.C. 3279-3733, for lack of jurisdiction. Relator alleged that fraudulent invoices were submitted to the federal government under the Emergency Watershed Protection Program (EWP) Program in both Graham and Cherokee Counties. In relator's third amended complaint, she named as defendants Graham County, the Graham County SWCD, and the Cherokee County SWCD, along with several individuals. Although the court found no fault with the district court's factual findings, the district court applied an incorrect legal standard in reaching its conclusion as to public disclosure. Rejecting the Seventh Circuit's view, the court held that a public disclosure requires that there be some act of disclosure outside of the government. In this case, while the Audit Report and the USDA Report at issue were disclosed to government officials charged with policing the type of fraud relator alleges, nothing in the record suggests that either report actually reached the public domain. Therefore, the public disclosure bar was not triggered on this basis. That the reports were disclosed to state and local government agencies as well as federal agencies does not alter the court's conclusion. Further, the existence of public information laws does not go against the court's holding. Accordingly, the district court had jurisdiction over this action and the court reversed. View "U.S. ex rel. Wilson v. Graham Cnty. Soil & Water" on Justia Law

The California Department of Forestry and Fire Protection (Cal Fire) responds to a wide variety of emergencies throughout the state, including more than 5,600 wildfires each year. Although Cal Fire itself owns and operates more than 3,000 fire and emergency response vehicles, it also depends on the availability of equipment and services it hires from private vendors. Fairview Valley Fire was a vendor of emergency vehicles and services, which it provided to Cal Fire and other governmental agencies for a number of years. Cal Fire sent Fairview a letter that suspended Fairview's right to provide emergency vehicles and services. The suspension was based on Cal Fire's investigation of a 2006 incident in which a Fairview employee impersonated a high-ranking fire department officer at a morning briefing being conducted at a fire incident and thereafter contacted Cal Fire personnel and, in violation of Hired Equipment Policies and Procedures (HEPP), was able to have Fairview vehicles and personnel hired outside the normal Cal Fire rotation. Cal Fire's investigation also disclosed that Fairview personnel falsified shift tickets so that Fairview was paid for two operators of a vehicle in instances when it was only entitled to payment for one, resulting in a $6,433 overpayment to Fairview. The investigation also found that, during the incident, Fairview employees obtained several hundred gallons of diesel fuel and then attempted, unsuccessfully, to avoid paying for the fuel. Fairview appealed its suspension to the Cal Fire regional chief; the appeal was ultimately rejected. Fairview then filed a civil complaint against Cal Fire alleging: one cause of action for breach of contract arising out of a dispatcher's request for two water tenders during the Witch Creek fire; a cause of action for declaratory relief challenging Cal Fire's decision not to use its services; and a cause of action for declaratory relief challenging the lack of competitive bidding under the HEPP. After review, the Court of Appeal affirmed the trial court's judgment in favor of Cal Fire: the Court agreed with Cal Fire that the agency was not required to employ the formal competitive bid process set forth in the Public Contract Code. Under the express terms of Cal Fire's written policies and procedures, no binding contract arises between Cal Fire and an equipment vendor until a vendor's equipment is actually dispatched by Cal Fire in an emergency. Further, the Court of Appeal also found the trial court properly dismissed Fairview's causes of action challenging its suspension as a Cal Fire vendor. Moreover, Fairview had no claim related to the underlying suspension because, while the case was pending in the trial court, Cal Fire lifted the suspension. View "Fairview Valley Fire v. CA Dept. of Forestry" on Justia Law

The City of Hot Springs published a request for competitive proposals from private entities for utilization of real property owned by the City. Both Pete Lien & Sons, Inc. (“Lien”) and Croell Redi-Mix (“Croell”) submitted proposals. The City accepted Lien’s proposal, and a final contract was negotiated. Croell subsequently commenced this action seeking declaratory and injunctive relief to require the City to reject all proposals and restart the process, contending that the contract involved the procurement of services and that the City had not followed the services procurement requirements of S.D. Codified Laws 5-18A-6 and 5-18A-7. Lien argued that the contract was for the lease of real property, and therefore, the service procurement statutes did not apply. The circuit court granted summary judgment to Lien and the City. The Supreme Court affirmed, holding that the City’s contract with Lien involved the lease of the City’s property rather than the procurement of services, and because the City followed the statutory leasing procedures, summary judgment was properly granted. View "Lowe v. City of Hot Springs" on Justia Law

FTR has constructed buildings for public entities for 15 years. In 1999, FTR submitted the winning bid of $7.345 million to construct a District school. During construction, FTR submitted approximately 150 proposed change orders (PCO). FTR claimed some were necessary because the District’s plans were inadequate or misleading. The District denied most of the PCOs on the grounds that the work was covered under the basic contract, the amounts claimed were excessive, or that a PCO was not timely under the contract. Construction was completed in 2001. Public Contract Code 7107 allows a public entity to withhold funds due a contractor when there are liens on the property or a good faith dispute concerning whether the work was properly performed. The court of appeal held that the trial court properly assessed penalties against District because it did not timely release retained funds; properly rejected the District's action under the False Claims Act, Government Code 12650; and properly assessed prejudgment interest. The court erred in its interpretation of a contract provision imposing time limitations to submit claims for extra work as requiring a showing of prejudice and erred in awarding fees for work not solely related to FTR's section 7107 cause of action. View "FTR Int'l, Inc. v. Rio Sch. Dist." on Justia Law

The Los Angeles Memorial Coliseum Commission and Los Angeles Memorial Coliseum Association alleged that defendants, who promoted and staged music events at the Coliseum and related venues, paid an employee of the Commission for services related to those music events and that such payments were inappropriate and not disclosed to plaintiffs. The trial court dismissed. The court of appeal reversed in part, finding that the plaintiffs adequately stated causes of action under the conflicts of interest prohibition in Government Code section 1090, conspiracy to defraud, violation of the Unfair Competition Law (UCL), and accounting. The court upheld dismissal of claims of violation of the False Claims Act, fraud, and negligence. View "Los Angeles Mem'l Coliseum Comm'n v. Insomniac, Inc." on Justia Law