Justia Government Contracts Opinion Summaries

DeLeon and Williams were separated from their jobs as cooks at a facility at Fort Riley installation, for allegedly removing government-owned food from the facility without authorization. The facility was a non-appropriated fund instrumentality (NAFI), and DeLeon and Williams were paid with non-appropriated funds. After denial grievances, filed under the collective bargaining agreement with their union, an arbitrator upheld the charges and removal penalties. The Federal Circuit dismissed for lack of jurisdiction, citing 5 U.S.C. 2105(c), which excludes NAFI employees from appealing adverse actions to the Merit Systems Protection Board As NAFI employees, DeLeon and Williams had no route available other than the grievance process; 5 U.S.C. 7121 (f) does not establish jurisdiction. View "Deleon v. Dep't of the Army" on Justia Law

In 2002 oil companies filed breach of contract actions against the government, concerning sales of offshore oil and glass leases in the 1980s. The Claims Court held that the government had breached its contracts by preventing the companies from drilling for oil in the offshore areas covered by the leases. The Federal Circuit affirmed the judgment and restitution awards of approximately $1 billion. Nycal, which held a 4.25 percent interest in two of the leases, waived its right to restitution and pursued a claim for lost profits. The Claims Court held that it was permissible for Nycal to seek lost-profits damages even though the other owners of the leases in which Nycal held a partial share had accepted restitution, but concluded that Nycal had not proved its case for lost profits. The Federal Circuit affirmed, noting the government’s evidence that Nycal could not have made a profit on its share of the leases.View "NYCAL Offshore Dev. Corp. v. United States" on Justia Law

Plaintiff brought a claim against the State Procurement Policy Board challenging the validity of Haw. Admin. R. 3-122-66, claiming it was contrary to the “minimum of three” persons requirement in Haw. Rev. Stat. 103D-304(g) and should be struck down. Plaintiff also sought a declaration that every government contract issued under the invalid authority of Rule 3-122-66 was void ab initio. The circuit court concluded that Plaintiff had standing to bring the action and that Rule 3-122-66 was invalid, but the court declined invalidate all contracts issued under Rule 3-122-66. Both parties appealed. The Supreme Court affirmed, holding (1) Petitioner had standing to bring his claim based on his status as an “interested person” and in order to satisfy the “needs of justice”; (2) Rule 3-122-66 is invalid because manifestly exceeds the scope of authority given by the legislature to the Board; and (3) the circuit court did not err in refusing to rule that every government contract issued under Rule 3-122-66 was void ab initio. View "Asato v. State Procurement Policy Bd." on Justia Law

In 2002, the Navy awarded Metcalf a contract to design and build 212 housing units in Hawaii by October, 2006, for $50 million. Problems arose involving soil conditions. The request for proposals stated that the “soil reconnaissance report” was “for preliminary information only” and required that the contractor conduct independent soil investigation, incorporating 48 C.F.R. 52.236-2, concerning site conditions that differ materially from those disclosed. Discussions delayed construction for a year. Metcalf implemented its preferred changes by over-excavating and using non-expansive fill, without a contract modification. The Navy denied that there was any material difference between pre-bid and post-award soil assessments, but approved some modifications. Metcalf was about 200 days behind schedule and began using “post-tension” concrete, which was more expensive but avoided the additional time and cost of over-excavation. The Navy amended the contract to approve use of post-tension concrete slabs. Metcalf claims additional delays resulting from the presence of more of a chemical contaminant than was expected. With respect to contamination, the Navy granted a 286-day extension and reimbursed $1,493,103. The Navy accepted the buildings in March, 2007. Metcalf alleged that its final cost was $76 million. The government paid less than $50 million. The Claims Court ruled in favor of the government, under the Contract Disputes Act, 41 U.S.C. 7104. The Federal Circuit vacated, holding that the court misconstrued what Metcalf needed to show to prove that the government breached its duty of good faith and fair dealing and misinterpreted certain contractual provisions.View "Metcalf Const. Co., LLC v. United States" on Justia Law

Roberts asserts that he is owed living quarters allowance (LQA) for his current civilian position as Deputy Camp Commander for a Marine Corps base in Okinawa, Japan. LQA is authorized for particular classes of employees by the Overseas Differentials and Allowance Act, 5 U.S.C. 5921, and regulations issued by the Department of State, the Department of Defense, and Marine Corps Bases Japan Order P12000.2A. In deciding whether to offer LQA for Roberts’s position, the deputy commanding general considered prior experience that there were qualified, locally-available candidates for DCC positions for whom LQA was not needed as a recruitment incentive. Many active-duty Marines like Roberts wished to remain in Okinawa in civilian positions after retirement. The deputy commanding general also determined that there were insufficient funds to support LQA for DCC positions in Okinawa without reallocating funds from other programs. Response to the 2008 job announcement, which noted that LQA was not offered, confirmed the lack of recruitment need; 14 qualified, locally-available candidates applied. When he was offered the position, Roberts was informed that his salary would be include no LQA.” The Claims Court rejected Roberts’s subsequent appeal of denial of his request for LQA. The Federal Circuit affirmed. View "Roberts v. United States" on Justia Law

Crewzers was awarded blanket purchase agreements (BPAs) with the Forest Service to provide buses that transport fire crews to wildfires and other disaster areas in regional and national wilderness zones and to provide flame retardant tents to disaster areas. Both BPAs established dispatch priority lists within geographic zones. When an emergency arose, the Service would to submit an order for the highest-ranked (lowest-priced) resource available on the priority. BPAs are frameworks for future contracts and state that “If a Contractor cannot be reached or is not able to meet the time and date needed, the dispatcher may proceed with contacting the next resource on the dispatch priority list.” The Service has discretion to deviate from priority lists as needed and did not make any guarantee that it would actually place orders under the BPAs. The BPAs required Crewzers to accept orders only if “willing and able.” The Service terminated the Crewzers BPA for buses after Crewzers allegedly responded with unauthorized vehicles and attempted to bill at a higher-than-authorized rate and later terminated its BPA for tents after Crewzers allegedly provided tents that did not meet specifications or failed to deliver on time. Crewzers sought a declaratory judgment that it was entitled to damages or to reinstatement of the BPAs. The Claims Court dismissed. The Federal Circuit affirmed, finding that the BPAs were not binding contracts for purposes of invoking Tucker Act (28 U.S.C. 1491(a)) jurisdiction. View "Crewzers Fire Crew Transp., Inc. v. United States" on Justia Law

Plaintiffs filed a qui tam action against DHL under the False Claims Act, 31 U.S.C. 3729 et seq., alleging that DHL billed the United States jet-fuel surcharges on shipments that were transported exclusively by ground transportation. On appeal, plaintiffs challenged the district court's dismissal for failure to satisfy a statutory notice requirement. The court concluded that the 180-day rule, which barred a challenge to a shipping charge before the STB, could not apply to a qui tam action under the FCA. Accordingly, the court vacated and remanded. View "United States v. DHL Express (USA), Inc." on Justia Law

Chhibber, an internist, operated a walk‐in medical office on the south side of Chicago. For patients with insurance or Medicare coverage, Chhibber ordered an unusually high volume of diagnostic tests, including echocardiograms, electrocardiograms, pulmonary function tests, nerve conduction studies, carotid Doppler ultrasound scans and abdominal ultrasound scans. Chhibber owned the equipment and his staff performed the tests. He was charged with eight counts of making false statements relating to health care matters, 18 U.S.C. 1035, and eight counts of health care fraud, 18 U.S.C. 1347. The government presented witnesses who had worked for Chhibber, patients who saw him, and undercover agents who presented themselves to the Clinic as persons needing medical services. Chhibber’s former employees testified that he often ordered tests before he even arrived at the office, based on phone calls with staff. Employees performed the tests themselves with little training, and the results were not reviewed by specialists; normally, the tests were not reviewed at all. Chhibber was convicted of four counts of making false statements and five counts of health care fraud. The Seventh Circuit affirmed, rejecting challenges to evidentiary rulings. View "United States v. Chhibber" on Justia Law

In 2001 KBR agreed to provide the Army with logistics support services during Operation Iraqi Freedom. Individual task orders required KBR to install, operate and maintain dining services near Mosul, Iraq on a cost-plus-award-fee basis. KBR selected ABC, a subcontractor, to build a prefabricated metal dining facility and to provide dining services for a camp population of 2,573. In June 2004, the Army ordered KBR to stop construction of the metal facility and begin construction of a reinforced concrete facility for an estimated 2,573 to 6,200+ persons. Instead of requesting bids for the new work, KBR kept ABC as the subcontractor due to the urgency of the request. ABC submitted a new proposal with a total monthly cost about triple the monthly cost initially quoted. ABC attributed the increased costs to additional labor and equipment to serve a larger population and to a drastic increase in the cost of labor and a severe shortage of staff willing to work in Iraq. Due to a calculation error, it was determined that ABC’s proposal was reasonable. KBR’s management reviewed and approved a change order, embodying ABC’s proposal. In 2005 the subcontract ended and title to the dining facility passed to the Army. In 2007, the Defense Contract Auditing Agency suspended payment of certain costs paid by KBR to ABC pursuant to the change order. KBR prepared a new price justification for the concrete dining facility and ultimately filed suit, seeking recovery of the $12,529,504 in costs disapproved for reimbursement. The Claims Court awarded $6,779,762. The Federal Circuit affirmed.View "Kellogg Brown & Root Servs. v. United States" on Justia Law

Hosea O. Weaver & Sons, Inc. appealed a jury verdict in favor of Ira Balch, personal representative of the Estate of Danny Balch, and Melvin Balch, personal representative of the estates of Bernard Balch and Armie Balch. The matter stemmed from a road-resurfacing project conducted by the Alabama Department of Transportation (ALDOT). ALDOT hired Weaver to complete the project. The Balches were traveling on the portion of the road resurfaced by Weaver when the vehicle they were riding in was hit head-on by a tractor-trailer. Their personal representatives filed wrongful-death actions against Weaver and others, alleging that Weaver negligently performed the resurfacing project, and that negligent performance caused the deaths of the Balches. The trial court denied Weaver's prejudgment motions, and the jury returned a verdict in the estates' favor. Weaver appealed the denial of its postjudgment motion, and alleged multiple errors at trial in its argument to the Supreme Court. Upon review, the Supreme Court concluded that Weaver owed no duty to the decedents, and therefore was entitled to judgment as a matter of law. The Court reversed the trial court and entered a judgment in favor of Weaver.View "Hosea O. Weaver & Sons, Inc. v. Balch" on Justia Law