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

The 2013 Department of Defense (DOD) budget was cut by $37 billion halfway through Fiscal Year 2013. The Secretary of Defense directed DOD managers to prepare to furlough most civilian employees for up to 11 workdays, with exceptions for employees deployed to a combat zone, those whose jobs are necessary to protect safety of life and property, Navy Shipyard employees, National Intelligence Program employees, Foreign Military Sales employees, political appointees, non-appropriated fund instrumentality employees, foreign national employees, and various employees not paid directly by DOD Military accounts. Snyder, a civilian engineer at the Naval Surface Warfare Center (Dahlgren) received a Notice of Proposed Furlough. Snyder worked on an Advanced Shipboard Weapons Control project, governed by a Cooperative Research and Development Agreement (CRADA) between Dahlgren and Lockheed. Lockheed was solely responsible for funding and paid $2.6 million in 2012 to the U.S. Treasurer. Unused funds were to be remitted to Lockheed. Lockheed and Snyder requested that Dahlgren employees supporting the CRADA be exempt from furlough. The Navy denied the request. The Federal Circuit affirmed the Merit System Protection Board in upholding Snyder’s furlough. An agency may furlough an employee for lack of work or funds or other non-disciplinary reasons, 5 U.S.C. 7511(a)(5), 7512(5) if the furlough “will promote the efficiency of the service.” The court found the furlough decision to “be a reasonable management solution to the financial restrictions placed on the agency.” View "Snyder v. Department of the Navy" on Justia Law

Diaz submitted an unsolicited proposal to the U.S. Department of the Navy’s Indian Head Explosive Ordnance Disposal Technology Division (IHEODTD) pursuant to Federal Acquisition Regulation (FAR) Subpart 15.6. An IHEODTD contracting officer conducted an initial review of Diaz’s proposal and determined that it did not satisfy two requirements of FAR 15.606-1: that it be innovative and unique and include sufficient detail to permit a determination that government support could be worthwhile and the proposed work could benefit the agency’s research and development or other mission responsibilities. The Court of Federal Claims dismissed Diaz’s complaint for lack of subject matter because he lacked standing under 28 U.S.C. 1491(b)(1). The Federal Circuit affirmed. Diaz did not possess the requisite direct economic interest to satisfy his “burden of establishing the elements of standing.” Diaz cannot demonstrate that he “had a substantial chance of winning the contract” because, at the very least, his proposal did not conform to the requirements of FAR Subpart 15.6, which governs unsolicited proposals. View "Diaz v. United States" on Justia Law

During Mayberry’s tenure as a civilian employee with the FBI, he elected Becker to receive survivor benefits under the Federal Employees Retirement System upon his death. They were married for less than nine months and had no children together when Mayberry died. Becker applied for survivor benefits with the Office of Personnel Management, which denied her application, citing 5 U.S.C. 8441(1), which identifies a widow as a “surviving wife” who: “was married to [the covered decedent] for at least [nine] months immediately before his death” or “is the mother of issue by that marriage.” An administrative judge for the Merit Systems Protection denied her request to seek information regarding whether OPM had ever waived the nine-month requirement for prior applicants, and whether OPM had ever sufficiently explained the nine-month requirement to Mayberry. The denial became the final decision of the Board. The Federal Circuit affirmed, rejecting arguments that 5 U.S.C. 8441(1) is unconstitutional and that the Board improperly denied her discovery requests. The court applied the rational basis test and cited Supreme Court precedent. View "Becker v. Office of Personnel Management" on Justia Law

The Defense Supply Center Philadelphia (DSCP), a sub-agency of the Defense Logistics Agency, issued a solicitation for an Indefinite-Delivery/Indefinite-Quantity commercial item contract to provide food and non-food products to customers, including the military, in three overseas zones. In May 2003, DSCP awarded a contract to Agility to supply “Full Line Food and Non-Food Distribution” to authorized personnel in Kuwait and Qatar. After many modifications, in December 2005, Agility submitted a Request for Equitable Adjustment for $13.1 million related to trucks being held in Iraq by the government for longer than 29 days. In April 2007, the government’s contracting officer denied Agility’s claim. The Armed Services Board of Contract Appeals denied Agility’s appeal in August 2015, finding that Agility had accepted all risks associated with delays beyond 29 days. The Board stated that it “need not decide whether the government constructively changed contract performance or whether it breached its implied duty of cooperation” because “whether the government breached the contract comes down to contract interpretation.” The Federal Circuit affirmed-in-part, agreeing that the government did not breach the express terms of the contract or a later agreement to consider exceptions, but finding that the Board erred when it concluded that it “need not decide” Agility’s implied duty and constructive change claims. View "Agility Public Warehousing Co. KSCP v. Mattis" on Justia Law

Within the Department of Defense, DRMS disposes of surplus military property at Defense Reutilization and Marketing Offices (DRMOs). Property that cannot be reutilized is demilitarized and/or reduced to scrap that can be sold. A 2007 DRMS Request for Proposals sought performance of DRMO activities for up to five years. A referenced website showed DRMS’s historical workload and scrap weight; an amendment indicated that “the contractor may experience significant workload increases or decreases” and outlined a process to “renegotiate the price” if workload increased. DRMS awarded its first contract to Agility to operate six DRMOs for one base year with four option years at a fixed price of $45,233,914.92 per year. Upon commencing work in Arifjan, the largest of the DRMOs, Agility immediately fell behind. It inherited a backlog of approximately 30 weeks. From the start, the volume received at Arifjan was greater than Agility anticipated. The parties terminated their contract for convenience in 2010. Agility thereafter requested funding for its additional costs, claiming DRMS provided inaccurate workload estimates during solicitation. The contracting officer awarded Agility only $236,363.93 for its first claim and nothing for the second, noting that Agility received an offset from its scrap sales. The Federal Circuit reversed, as “clearly erroneous,” the Claims Court’s findings that DRMS did not inadequately or negligently prepare its estimates and that Agility did not rely on those estimates. Agility’s receipt of scrap sales and the parties’ agreement did not preclude recovery. View "Agility Defense & Government Services, Inc. v. United States" on Justia Law

In 2012, the FTC announced the “Robocall Challenge,” under 15 U.S.C. 3719(b). The public was invited to create “innovative solutions to block illegal robocalls.” for a $50,000 prize. Contestants granted the FTC non-exclusive, irrevocable, royalty free and worldwide license and agreed to release the FTC from all liability. The FTC received about 800 submissions. The judges, with little guidance from the contest rules, decided that the frontrunners would be those entries that proposed using filtering as a service (FaaS) to block robocalls. Frankel’s submission proposed a “traceback” solution rather than FaaS. When his submission was not chosen, Frankel sued under the bid protest provisions of 28 U.S.C. 1491(b) and alleging breach of contract. The Federal Circuit affirmed the Claims Court’s rejection of both theories. His contract with the FTC was not a procurement contract, so Frankel did not have standing to register an objection to the award under section 1491(b). Frankel is unable to show “fraud, irregularity, intentional misconduct, gross mistake, or lack of good faith.” Any other breach of contract claim based on the judging process is barred by the limitation of liability clause. View "Frankel v. United States" on Justia Law

In 1994, Rocky Mountain and the Bureau of Land Management entered into the Helium Contract, giving Rocky Mountain the right, for up to 25 years, to extract helium gas from roughly 21,000 acres of federal lands in Colorado and Utah. Rocky Mountain never extracted helium from the property and, after one year, stopped paying rent. In 2004, the Bureau informed Rocky Mountain that it had cancelled the contract due to nonpayment. The parties entered into a Settlement Agreement, under which the Bureau was required to provide Rocky Mountain with data about gas composition on the land covered by the Helium Contract and Rocky Mountain had to pay $116,579.90 (back rent) so that the Helium Contract would be reinstated. Rocky Mountain subsequently objected that the Bureau's information as incomplete, refused to pay the $116,579.90, and informed the Bureau that it wanted to pursue mediation under the Agreement. When the parties were unable to agree whether the information was complete, the Bureau sent a termination letter. The Claims Court rejected Rocky Mountain’s breach of contract suit for lack of jurisdiction and on the merits. The Federal Circuit agreed that the Helium Contract was terminated in 2004 and never reinstated, but found that the court had jurisdiction over the Settlement Agreement dispute. View "Rocky Mountain Helium, LLC v. United States" on Justia Law

The power companies allege that they were overcharged for electricity during several months in 2000–2001 and sought to recover the overcharges from the federal government based on sales by the federal Western Area Power Administration (WAPA) and Bonneville Power Administration (BPA). The California Power Exchange (Cal-PX) and the California Independent System Operator (Cal-ISO) were responsible for acquiring and distributing electricity between producers and consumers in California and setting prices for the electricity. The power companies argued that a contract existed between all consumers of electricity (including themselves) and all producers of electricity (including the government agencies) in California. The government argued that the contracts were only between the middleman entities—Cal-PX and Cal-ISO—and the consumers and producers individually. The Claims Court dismissed for lack of standing. The Federal Circuit affirmed. The companies lack privity of contract or any other relationship with the government that would confer standing. Under the Tucker Act, the Claims Court has jurisdiction over contract cases in which the government is a party, 28 U.S.C. 1491(a)(1); normally a contract between the plaintiff and the government is required to establish standing. The court noted that the companies may have claims against the parties with whom they are in contractual privity, the electricity exchanges. View "Pacific Gas & Elec. Co. v. United States" on Justia Law

Nutt was hit and killed by a U.S. Army soldier driving an Army truck in 1983. His family filed a claim under 28 U.S.C. 2674, the Federal Tort Claims Act. A 1985 Agreement provided that the government “agrees to purchase annuities which will pay:” $60,000 per year to Cynthia; lump-sum payments on specified anniversaries to Cynthia; lump-sum payments on specified anniversaries to James; plus $240,000 to Cynthia and a payment to the Nutts’ attorneys. The Agreement provided that “[t]he payments by the United States set forth above shall operate as full and complete discharge of all payments to be made to and of all claims which might be asserted.” The government purchased a structured annuity ELNY. ELNY went into receivership in 1991. In 2011, the New York State Liquidation Bureau informed the Nutts that their benefit payments would be reduced. In 2013, they began receiving payments reduced to approximately 45% of their expected benefits. They were informed that, as of 2015, they would not be receiving the anniversary payments. The Nutts alleged breach of the agreement. The Federal Circuit affirmed dismissal, finding that the government “was not obligated to guarantee or insure that annuity; its obligation ended at the initial purchase of the ELNY annuity.” View "Nutt v. United States" on Justia Law

Liberty’s 325 patent, issued in 2010, is “directed to a projectile structured to be discharged from a firearm and designed to overcome the disadvantages and problems associated with conventional firearm projectiles such as, but not limited to lead or steel jacketed projectiles.” The patent grew out of the U.S. military’s “Green Ammunition Program,” developed in response to concerns that lead-based ammunition was polluting military training ranges. The 325 patent sought to address “problems of lethality” with the conventional Army “green” ammunition. The Claims Court held that ammunition rounds used by the Army embody the claims of the patent, violating 28 U.S.C. 1498. The Federal Circuit reversed, holding that the trial court erred in construing claim terms: reduced area of contact; intermediate opposite ends. When the terms are construed correctly, the Army rounds do not embody the claimed invention. The court affirmed the Claims Court's rejection of a breach of contract claim based on a non-disclosure agreement signed by the named inventor of the 325 patent and an Army official during negotiations for a possible contract. The Army official did not have authority to enter into an NDA on behalf of the government. View "Liberty Ammunition, Inc. v. United States" on Justia Law