Justia Government Contracts Opinion Summaries

Under the Workforce Investment Act, 29 U.S.C. 2887(a)(2)(A), the Department of Labor administers the Job Corps program, providing education, training, and support services to help at-risk youth obtain employment. There are 125 Job Corps Centers, including Blue Ridge in Marion, Virginia, which Res-Care has operated since 1998. In 2011, DOL published a Request for Information from potential bidders on an upcoming procurement for the operation of Blue Ridge. Res-Care’s contract was to expire in 2013. The Request encouraged firms that qualify as small businesses to respond with a “capabilities statement.” One large and four small businesses submitted statements. Res-Care, a large business, did not submit. The contracting officer found that, based on the responses, DOL would likely receive bids from at least two responsible small businesses at fair market prices, as required by the Federal Acquisition Regulation, 38 C.F.R. 19.502-2(b), and recommended conducting the selection as a small business set-aside. DOL issued a presolicitation notice indicating that the next Blue Ridge contract, with a value of $25 million, would be solicited as a “100% Set-Aside for Small Business.” Res-Care filed a bid protest alleging that DOL violated WIA by setting aside the Blue Ridge contract for small businesses, based on the “competitive basis” provision in section 2887. The Claims Court and Federal Circuit upheld the DOL determination.View "Res-Care, Inc. v. United States" on Justia Law

Intervenors filed suit challenging the Commission's order approving a negotiated service agreement for the sale of postage between the Postal Service and Valassis Direct Mail. As a preliminary matter, the court concluded that it need not consider whether Resolution 11-4 violated 39 U.S.C. 402 where the Governors reviewed and approved the agreement before it was submitted to the Commission. On the merits, the court denied the petition for review, concluding that the Commission's order complied with the Postal Accountability and Enhancement Act, S.Rep.No. 108-318, at 2-4, and the Administrative Procedure Act, 5 U.S.C. 500 et seq.View "Newspaper Assoc. of America v. Postal Regulatory Commission" on Justia Law

Foglia, an RN, was hired by Renal, a dialysis care services company, in 2007, and was terminated in 2008. Foglia filed a qui tam complaint against Renal under the False Claims Act, 31 U.S.C. 3729, in 2009. The United States chose not to intervene. In a second amended complaint, Foglia claimed that Renal falsely certified that it was in compliance with state regulations regarding quality of care, falsely submitted claims for reimbursement for the drug Zemplar, and re-used single-use Zemplar vials. The court dismissed, finding that Foglia had failed to state his claim with the heightened level of particularity required by Federal Rule of Civil Procedure 9(b) for fraud claims. The court noted Foglia’s failure to provide a “representative sample” or to “identify representative examples of specific false claims” and that even if Foglia’s claim had met the requirement of Rule 9(b), Foglia “provided no authority under an express or implied false certification theory that the claims submitted … violated a rule or statute establishing compliance as a condition of payment.” Foglia appealed dismissal of his claim of over-billing on Zemplar. The Third Circuit reversed, noting that it was a close case, the need to assume that Foglia was correct in alleging that Renal did not follow proper procedures if it was to harvest “extra” Zemplar from used vials, and that only Renal has access to the documents that could prove the claim. View "Foglia v. Renal Ventures Mgmt., LLC" on Justia Law

Kingdomware is a VA-certified service-disabled veteran-owned small business. The Small Business Act, 15 U.S.C. ch. 14A, states that small businesses generally will receive “a fair proportion of the total purchases and contracts for property and services for the Government.” Veteran-Owned Small Businesses (VOSBs) and Service-Disabled Veteran-Owned Small Businesses (SDVOSBs) are expressly recognized in the Small Business Act and the Federal Acquisition Regulation (FAR), 48 C.F.R. ch. 1, which implements the Office of Federal Procurement Policy Act, 41 U.S.C. ch. 7. Agency-specific contract regulations are stated in the Veterans Affairs Acquisition Regulation (VAAR), 48 C.F.R. ch. 8. In 2012, the VA decided to implement an Emergency Notification Service in medical centers. The VA contracting officer chose to use the General Services Administration (GSA) Federal Supply Schedule (FSS) to procure the needed services, and awarded the contract to a FSS vendor which was not a VOSB. Kingdomware filed a bid protest with the Government Accountability Office (GAO), which rejected the VA’s argument, and issued a recommendation that the VA cancel the award. The VA did not acquiesce. The Claims Court upheld the VA determination, interpreting 38 U.S.C. 8127(c), concerning use of restricted competition, as not creating a mandatory set-aside. The overarching policy of the FAR generally demands ‘full and open competition,” which is deemed satisfied by FSS contracts. The FAR specifies that an agency is encouraged to obtain goods and services from FSS contractors before purchasing from commercial sources, which include privately owned VOSBs and SDVOSBs. The Federal Circuit affirmed. View "Kingdomware Techs, Inc. v. United States" on Justia Law

In 1996, the Air Force entered into a contract under which SUFI would install and operate telephone systems in guest lodgings on bases in Europe at no cost to the government; the Air Force agreed that SUFI network was to be the exclusive method available to a guest placing telephone calls at the lodging. The contract permitted SUFI to block other networks and required the Air Force to remove or disable preexisting Defense Switched Network (DSN) telephone lines in hallways and lobbies, but DSN phones remained in place. Call records showed that, with Air Force assistance, guests often placed multiple or lengthy individual calls. After the Air Force declined to implement controls to curb DSN and patched-call abuse, SUFI blocked guest-room access to the DSN operator numbers but permitted morale calls from lobby phones, monitored by sign-in logs. Air Force personnel failed to require guests to sign the logs and gave guests new DSN access numbers, to circumvent SUFI’s charges. After failed attempts to resolve the situation, including through the Armed Services Board of Contract Appeals, SUFI sold the telephone system to the Air Force for $2.275 million and submitted claims, totaling $130.3 million, to the contracting officer. The officer denied the claims, except for $132,922 on a claim involving use of calling-cards. The Board later awarded $7.4 million in damages, plus interest. In an action under the Tucker Act, 28 U.S.C. 1491, the Court of Federal Claims awarded $118.76 million in damages, plus interest. The Federal Circuit vacated in part and remanded for additional findings. View "SUFI Network Servs, Inc. v. United States" on Justia Law

DynCorp contracted with the U.S. Department of State to assist in the development of a civilian police force in Iraq and subcontracted with PMC for operations and maintenance support. PMC filed suit against DynCorp alleging that DynCorp breached its contract with PMC by making payments to one account instead of another. The court affirmed the district court's dismissal of PMC's case against DynCorp as a sanction for its discovery malfeasance. The court rejected PMC's arguments on appeal because they did not support reversal of the district court's orders.View "Projects Mgmt. Co. v. DynCorp Int'l LLC" on Justia Law

Fuqua, a computational linguist, was hired by SVOX in 2009 to help market linguistic products. A few months later, SVOX approached Fuqua with a new employment contract that contained an inventions assignment clause that required Fuqua to disclose and assign to SVOX intellectual property that he made, conceived, or developed in the past and required assignment of his rights to patents, copyrights, trademarks, trade secrets, and royalties to SVOX. Fuqua believed that the disclosure required by the new agreement would violate state and federal laws and refused to sign the contract. SVOX terminated Fuqua’s employment. Fuqua filed a complaint with the Office of Inspector General of the Department of Defense (OIG), alleging violation of the American Recovery and Reinvestment Act of 2009, which prohibits reprisals for disclosures of wrongdoing relating to covered funds under the act. The OIG found that SVOX did not receive Recovery Act funds and declined to investigate further. The district court dismissed, finding that SVOX did not receive covered funds. The Seventh Circuit affirmed. View "Fuqua v. SVOX USA, Inc." on Justia Law

Orillo, her husband (a doctor), and another owned Chalice, a home health care provider. Chalice was an enrolled provider with Medicare and could seek reimbursement of home health care through that program. Orillo falsified forms by altering the codes and information that had been completed by the Chalice nurses to make the patient’s condition appear worse and the health care needs greater than the actuality. Those alterations caused Medicare software to generate different reimbursement rates Orillo also aided her husband in paying kickbacks to a Chicago doctor in return for referrals of Medicare patients. Orillo pled guilty to healthcare fraud, 18 U.S.C. 1347 and paying kickbacks to physicians for patient referrals under a federal health care program, 42 U.S.C. 1320a-7b and 18 U.S.C. 2, and was sentenced to 20 months’ imprisonment. Orillo conceded that her scheme caused a loss, to Medicare, in excess of $400,000, and agreed to entry of a $500,000 forfeiture judgment.The district court determined that the loss amount for the healthcare fraud count was $744,481 and ordered her to pay that amount in restitution. The Seventh Circuit affirmed, rejecting Orillo’s argument that the loss and restitution amount should be limited to only those stemming from visible alterations.View "United States v. Orillo" on Justia Law

A state agency issued a request for proposals for legal services. A law firm delivered its proposal after the submission deadline, but the procurement officer accepted the proposal and forwarded it to the evaluation committee. After the agency issued a notice of intent to award that law firm the contract, a second law firm protested, alleging that the evaluation committee made scoring errors and that consideration of the late-filed proposal was barred by a relevant regulation and the request for proposals. The procurement officer sustained the protest, rescinded the original award, and awarded the second law firm the contract. The first law firm then protested, claiming: (1) the second law firm’s protest should not have been considered because it was filed after the protest deadline; (2) the first law firm’s proposal was properly accepted because the delay in submission was immaterial; and (3) the second law firm’s proposal was nonresponsive because that firm lacked a certificate of authority to transact business in Alaska. The procurement officer rejected that protest and the first law firm filed an administrative appeal. The administrative agency denied the appeal, and the first law firm appealed the agency decision to the superior court, which affirmed the administrative agency ruling. Upon review, the Supreme Court concluded that the administrative agency acted reasonably in accepting the second law firm’s late-filed protest and deeming that firm’s proposal responsive notwithstanding its lack of a certificate of authority. Furthermore, the Court concluded the agency’s interpretation that its regulation barred acceptance of the first firm’s late-filed proposal is reasonable and consistent with statute. Therefore, the Court affirmed the superior court’s decision upholding the final agency decision. View "Davis Wright Tremaine LLP v. Alaska, Dept. of Administration" on Justia Law

Southern Rehabilitation Group and its medical director sued the Secretary of Health and Human Services and past and present Medicare contractors, seeking review of the Secretary’s final decision on 6,200 claims for Medicare reimbursement. The district court remanded so that the Secretary could pay the disputed amount. After payment, the case returned to the district court, which concluded that the claims for payment were moot and dismissed remaining constitutional and statutory claims as barred by jurisdictional provisions of the Medicare Act. The court also held that plaintiffs did not show that they were eligible to collect interest on their claims and that it did not have jurisdiction over 8,900 other claims that plaintiffs alleged were still in the administrative process. The Sixth Circuit affirmed summary judgment to defendants on plaintiffs’ federal and state law claims and on the 8,900 claims still in the administrative process, but reversed summary judgment on plaintiffs’ claims for interest. The Secretary could not rely on her unreasonable interpretation of the “clean-claims” statute as a basis for summary judgment concerning interest.View "S. Rehab. Grp. v. Sec'y of Health & Human Servs." on Justia Law