Justia U.S. Federal Circuit Court of Appeals Opinion Summaries

The Greens opened a Union Bank of Switzerland (UBS) account around 1980, with their daughter, Kimble, as a joint owner. Kimble directed UBS to maintain the account as a numbered account and to retain all correspondence at the bank. Kimble married an investment analyst who agreed to preserve the secrecy of the account. The couple’s joint federal tax returns did not report any income derived from the UBS account nor disclose the existence of the foreign account. After the couple divorced, Kimble's tax returns were prepared by a CPA, who never asked whether she had a foreign bank account. In 2003-2008, Kimble’s tax forms, signed under penalty of perjury, represented that she did not have a foreign bank account.In 2008, Kimble learned of the Treasury Department’s investigation into UBS for abetting tax fraud; she retained counsel. UBS entered into a deferred prosecution agreement that required UBS to unmask numbered accounts held by U.S. citizens. Kimble was accepted into the Offshore Voluntary Disclosure Program (OVDP) and agreed to pay a $377,309 penalty. Kimble withdrew from the OVDP without paying the penalty.The IRS determined that Kimble’s failure to report the UBS account was willful and assessed a penalty of $697,299, 50% of the account. Kimble paid the penalty but sought a refund. The Federal Circuit affirmed summary judgment against Kimble, finding that she violated 31 U.S.C. 5314 and that her conduct was “willful” under section 5321(a)(5). The IRS did not abuse its discretion in setting a 50% penalty. View "Kimble v. United States" on Justia Law

Pentagon Force Protection Agency officers filed claims for overtime compensation under the Fair Labor Standards Act, 29 U.S.C. 207(a)(1). Officers worked 8.5-hour shifts, with two 35-minute breaks, and were compensated for their entire shift except for one 30-minute meal period. Plaintiffs argue that they did not receive a bona fide meal period because they were required to work during breaks; they were not allowed to leave the Pentagon or remove their uniforms, nor to congregate in public or publicly engage in leisure activities. While on break, they had to remain ready to respond to emergencies, which occurred frequently. If an officer responded to an emergency during both break periods (unable to take a bona fide meal break), an overtime request was granted for one break period. Officers were to constantly monitor their radios and respond to questions from other employees or members of the public, which occurred frequently but could be avoided by going to a break room. They often used breaks for processing paperwork, completing mandatory training courses online, and refueling Pentagon vehicles.The Federal Circuit affirmed summary judgment in favor of the government. The Claims Court properly used the predominant benefit test and considered whether the employees were required to perform any “substantial duties” or give up a “substantial measure” of time and effort during a meal break, correctly focusing on “actual obligations,” rather than witness characterization. In the totality of the circumstances, Plaintiffs were the primary beneficiaries of their meal breaks. View "Akpeneye v. United States" on Justia Law

In 2008, severe storms hit Indiana. Columbus Hospital sustained significant damage. President Bush authorized FEMA assistance through disaster grants under the Stafford Act, 42 U.S.C. 5121–5206. The state agreed to be the grantee for all grant assistance, with the exception of assistance to individuals and households. FEMA reserved the right to recover assistance funds if they were spent inappropriately or distributed through error, misrepresentation, or fraud. Columbus apparently submitted its request directly to FEMA, instead of through the state. FEMA approved Columbus projects, totaling approximately $94 million. Funds were transmitted to Columbus through the state. In 2013, the DHS Inspector General issued an audit report finding that Columbus had committed procurement violations and recommended that FEMA recover $10.9 million. FEMA reduced that amount to $9,612,831.19 and denied Columbus’s appeal. Columbus did not seek judicial review. FEMA recovered the disputed costs from Columbus in 2014.In 2018, Columbus filed suit, alleging four counts of contract breach and illegal exaction. The Claims Court dismissed Columbus’s illegal exaction claim, holding that Columbus did not have a property interest in the disputed funds and that FEMA’s appeal process protected Columbus’s rights to due process, and dismissed Columbus’s contract-based claims, finding that Columbus had no rights against FEMA under that contract or otherwise. The Seventh Circuit affirmed the dismissal of the illegal exaction and express and implied contract claims. The court vacated the dismissal of the third-party beneficiary contract claim. View "Columbus Regional Hospital v. United States" on Justia Law

In 1992, Brenner joined the VA as an attorney. In 2015, he suffered an accident that resulted in the amputation of his lower leg. He missed approximately six months of work and was reassigned to the Collections National Practice Group (CNPG). He received an overall “unacceptable” rating for 2017. Brenner unsuccessfully challenged the rating. In 2018, his supervisor proposed Brenner’s removal under 38 U.S.C. 714, listing 31 instances in which Brenner failed to meet deadlines and other errors. Brenner challenged the charges, citing his assignment to the CNPG and the “discrimination, retaliation, hostile work environment[,] and abuse of authority he has endured since.” Brenner also asserted that he had previously engaged in protected EEO and whistleblowing activity and attached copies of his complaints filed with the Office of Special Counsel (OSC) and Office of Accountability and Whistleblower Protection (OAWP). He argued that the deciding official, Hipolit, was required to recuse himself, given his prior involvement in Brenner’s complaints and discipline.Following the conclusion of Brenner's OSC and OAWP cases, Hipolit upheld the proposed removal as supported by substantial evidence. The Merit Systems Protection Board affirmed, finding that Brenner had not proven his affirmative defenses. The Federal Circuit vacated. The MSPB erred when it concluded that the Accountability and Whistleblower Protection Act of 2017, 38 U.S.C. 714, precluded, rather than required, review of the penalty imposed on Brenner and erred in applying the Act retroactively. View "Brenner v. Department of Veterans Affairs" on Justia Law

Taylor Energy leased and operated Gulf of Mexico oil and gas properties, on the Outer Continental Shelf, offshore Louisiana. In 2004, Hurricane Ivan destroyed those operations, causing oil leaks. The Outer Continental Shelf Lands Act, the Clean Water Act, and the Oil Pollution Act required Taylor to decommission the site and stop the leaks. Taylor and the Department of the Interior developed a plan. Interior approved Taylor’s assignments of its leases to third parties with conditions requiring financial assurances. Three agreements addressed how Taylor would fund a trust account and how Interior would disburse payments. Taylor began decommissioning work. In 2009, Taylor proposed that Taylor “make the full final deposit into the trust account,” without any offsets, and retain all insurance proceeds. Interior rejected Taylor’s proposal. Taylor continued the work. In 2011, Taylor requested reimbursement from the trust account for rig downtime costs. Interior denied the request. In 2018, the Interior Board of Land Appeals (IBLA) affirmed Interior’s 2009 and 2011 Decisions.Taylor filed suit in the Claims Court, asserting contract claims. The Federal Circuit affirmed the dismissal of the suit, rejecting “Taylor’s attempt to disguise its regulatory obligations as contractual ones,” and stating an IBLA decision must be appealed to a district court.In 2018, Taylor filed suit in a Louisiana district court, seeking review of the IBLA’s 2018 decision and filed a second complaint in the Claims Court, alleging breach of contract. On Taylor's motion, the district court transferred the case, citing the Tucker Act. The Federal Circuit reversed. The Claims Court does not have subject matter jurisdiction over this case. Taylor is challenging the IBLA Decision and must do so in district court under the APA. View "Taylor Energy Co., L.L.C. v. Department of the Interior" on Justia Law

In 2009, Meidinger submitted whistleblower information to the IRS under 26 U.S.C. 7623, concerning “one million taxpayers in the healthcare industry that are involved in a kickback scheme.” The IRS acknowledged receipt of the information, but did not take action against the accused persons. The IRS notified Meidinger of that determination. Meidinger argued that the IRS created a contract when it confirmed receipt of his Form 211 Application, obligating it to investigate and to pay the statutory award. The Tax Court held that it lacked the authority to order the IRS to act and granted the IRS summary judgment. The D.C. Circuit affirmed that Meidinger was not eligible for a whistleblower award because the information did not result in initiation of an administrative or judicial action or collection of tax proceeds.In 2018, Meidinger filed another Form 211, with the same information as his previous submission. The IRS acknowledged receipt, but advised Meidinger that the information was “speculative” and “did not provide specific or credible information regarding tax underpayments or violations of internal revenue laws.” The Tax Court dismissed his suit for failure to state a claim; the D.C. Circuit affirmed, stating that a breach of contract claim against the IRS is properly filed in the Claims Court under the Tucker Act: 28 U.S.C. 1491(a)(1). The Federal Circuit affirmed the Claims Court’s dismissal, agreeing that the submission of information did not create a contract. View "Meidinger v. United States" on Justia Law

In 2013, the Naval Facilities Engineering Command installed copyrighted graphics-rendering software created by German company Bitmanagement onto all computers in the Navy-Marine Corps Intranet. No express contract or license agreement authorized the Navy’s actions. In 2016, Bitmanagement filed suit, alleging copyright infringement, 28 U.S.C. 1498(b). The Claims Court found that, while Bitmanagement had established a prima facie case of copyright infringement, the Navy was not liable because it was authorized to make copies by an implied license, arising from the Navy’s purchase of individual licenses to test the software and various agreements between the Navy and the vendor.The Federal Circuit vacated and remanded for the calculation of damages. The Claims Court ended its analysis prematurely by failing to consider whether the Navy complied with the terms of the implied license, which can readily be understood from the parties’ entire course of dealings. The implied license was conditioned on the Navy using a license-tracking software, Flexera, to “FlexWrap” the program and monitor the number of simultaneous users. The Navy failed to effectively FlexWrap the copies it made; Flexera tracking did not occur as contemplated by the implied license. That failure to comply creates liability for infringement. View "Bitmanagement Software GMBH v. United States" on Justia Law

Crocs's Design Patent 789, titled “Footwear,” has a single claim for the “ornamental design for footwear.” Crocs sued Dawgs for infringement, Dawgs sought inter partes reexamination (IPE) under 35 U.S.C. 311. The district court stayed its proceedings. The examiner rejected the claim as anticipated, 35 U.S.C. 102(b). While an appeal to the Patent Trial and Appeal Board was pending, Dawgs filed for Chapter 11 bankruptcy. The bankruptcy court approved the sale of all of its assets to a new entity, Holdings, “not free and clear of any Claims Crocs . . . may hold for patent infringement occurring post-Closing Date by any person ... or any defenses Crocs may have in respect of any litigation claims that are sold.” The bankruptcy court authorized the distribution of the net sale proceeds and dismissed Dawgs’s bankruptcy case. Holdings assigned all rights, including explicitly the claims asserted by Dawgs in the infringement action and the IPE, to Mojave. Dawgs dissolved but continued to exist for limited purposes, including “prosecuting and defending suits" and "claims of any kind.”The Board declined to change the real-party-in-interest from the IPE requestor to Mojave, then reversed the examiner’s rejection of the patent’s claim. The Federal Circuit granted the motion to substitute. The assignments indicate that Mojave is Dawgs's successor-in-interest; as such, Mojave has standing. If the Board precludes substitution on the basis of a transfer in interest because of a late filing, it would defeat the important interest in having the proper party before the Board. View "Mojave Desert Holdings, LLC v. Crocs, Inc." on Justia Law

Holmes began working for the USPS in 1989. An investigation revealed that another letter carrier, Baxter, was selling marijuana from Baxter’s postal truck. Surveillance video showed Holmes and other USPS employees engaged in transactions with Baxter while on duty. Baxter later admitted to selling marijuana from his USPS vehicle; six other letter carriers admitted to purchasing marijuana from Baxter. Holmes denied purchasing marijuana while on duty. The surveillance video showed two relevant interactions between Baxter and Holmes, while on duty.At pre-disciplinary interviews, Holmes invoked his Fifth Amendment right to remain silent. Following a Notice of Proposed Removal, Holmes met with the deciding official, Bush, and stated that he “wanted to apologize,” and that he “made this little mistake.” Bush issued a termination, explaining that removal was consistent with the penalties received by the other employees. Bush considered Holmes’s lengthy federal service and lack of disciplinary record but concluded that they did not outweigh the support for his removal. In five grievance arbitrations, the arbitrators mitigated the penalty to long-term suspension without back pay. Holmes instead appealed to the Merit System Protection Board, arguing that the agency had insufficient evidence to find that he purchased marijuana from Baxter.The Board upheld his removal. The Federal Circuit affirmed, rejecting arguments that the removal was arbitrary or otherwise not in accordance with law; obtained without procedures required by law,; or unsupported by substantial evidence, 5 U.S.C. 7703(c) View "Homes v. United States Postal Service" on Justia Law

The Army Corps of Engineers issued a request for proposals. NIKA bid but was not awarded a contract. NIKA made a timely request for debriefing. The Corps sent NIKA a written debriefing and alerted NIKA of the right to submit additional questions. NIKA did not submit additional questions. NIKA filed a protest at the Government Accountability Office (GAO) six days after the written debriefing. Under 31 U.S.C. 3553(d), bid protests filed at the GAO invoke an automatic stay of procurement during the pendency of the protest if the federal agency awarding the contract receives notice within five days of debriefing. GAO denied the stay as untimely.NIKA filed suit, citing 10 U.S.C. 2305(b)(5)(B)(vii), which states that “[t]he debriefing shall include . . . an opportunity for a disappointed offeror to submit, within two business days after receiving a post-award debriefing, additional questions related to the debriefing.” The Claims Court instituted the stay. The bid protest concluded and the stay has ended.The Federal Circuit reversed, first holding that the issue was not moot, being capable of repetition but evading review. The text of 31 U.S.C. 3553(d) indicates that when no additional questions are submitted, the “debriefing date” is the date upon which the party receives its debriefing. The five-day period begins on the debriefing date, rather than two days later. Because NIKA did not file at the GAO within the five-day period, it did not timely invoke the stay. View "NIKA Technologies, Inc. v. United States" on Justia Law