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

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

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

The Job Corps program, a national residential training and employment program administered by the Department of Labor, was reformed by the 1998 Workforce Investment Act, which authorized the Secretary of Labor to enter into agreements with government agencies or private organizations to operate “Job Corps centers,” 29 U.S.C. 2887. Adams is the incumbent contractor for the Gadsden and the Shriver Job Corps Centers. When the contracts expired, Adams was disqualified from renewal because of the small business limitation imposed by the Department on the bids. Adams cannot does not qualify as a small business. The limit is $35.5 million in annual receipts, 13 C.F.R. 121.201. After unsuccessful bid protests, the Claims Court and the Federal Circuit upheld the administrative actions against challenges that they were arbitrary. View "Adams & Assocs., Inc. v. United States" on Justia Law

Mitchell began working as a Social Security Administration lawyer in 1998. The Department of Justice appointed her as a Special Assistant United States Attorney in 2006, a one-year appointment during which she remained an employee of and was paid by, the SSA. The Department extended that appointment, so that she served more than two years in the Special Assistant position. Effective December 21, 2008, the Department hired Mitchell as an AUSA in the same office. The Department’s form 50-B cited 28 U.S.C. 542, which authorizes AUSA appointments generally. The form stated that the appointment was not to exceed 18 months, was “temporary” and “subject to” successful completion of a pending background investigation. The background check concluded in July 2009. In August 2009, the Department provided Mitchell another form 50-B, citing 28 U.S.C. 542, but stating that Mitchell was subject to a two-year trial period beginning August 2, 2009, during which she could be removed without cause or appeal. The Department fired Mitchell days before that period was to end, without notice or opportunity to respond. The Merit Systems Protection Board dismissed an appeal for lack of jurisdiction, concluding that Mitchell was not an “employee” under 5 U.S.C. 7511(a). The Federal Circuit reversed, reasoning that Mitchell had “completed 2 years of current continuous service in the same or similar positions in an Executive agency under other than a temporary appointment limited to 2 years or less,” considering the time during which the background check was performed.View "Mitchell v. Merit Sys. Protection Bd." on Justia Law

In 2006, the Federal Bureau of Prisons issued a Request for Proposals for the “design-build” construction of a federal correctional institution. The project involved a “cut-to-fill” site, meaning that the ground had to be leveled by excavating materials from one area of the site and using those materials to fill lower areas. Based on information in the solicitation documents and prior experience, BH believed the New Hampshire Department of Environmental Sciences would approve a permit for a one-step-cut-to-fill construction plan and calculated its bid price, $238,175,000, accordingly. The contract provided liquidated damages of $8,000 for each day completion was overdue. The NHDES rejected the application. BH advised the government of the implications of NHDES restrictions, but did not refuse to proceed or request that the government intervene with the NHDES. According to BH, the restrictions were contrary to generally accepted industry practice. Upon completion of cut-to-fill operations, BH submitted a Request for Equitable Adjustment, seeking $7,724,885 for excess costs. The Contracting Officer and the Claims Court rejected the request, finding that the Permits and Responsibilities clause placed the burden of obtaining and complying with state and local permits on BH “without additional expense to the Government;” that BH had not alleged violation of the implied duty of good faith; and that, because the government did not control the NHDES, there was no basis for imposing liability for constructive change. The Federal Circuit affirmed. View "Bell/Heery v. United States" on Justia Law

Salem, under contract, coordinated Marine Corps Community Services (MCCS) shipments around the country. Estes, a federal motor carrier, handled some shipments under its common carrier tariff, without a written contract. The Salem-MCCS contract provided that Salem would pay carriers directly and invoice MCCS. Salem agreed not to represent itself as a representative of MCCS. All bills of lading indicated that “third party freight charges” were to be billed to “Marine Corps Exchange C/O Salem Logistics.” Delivery receipts specified that charges should be billed to the “Marine Corps Exchange” and were signed by a representative of the MCCS or MCX delivery location. MCCS paid Salem for some of the shipments; Salem never paid Estes. After becoming aware that Salem was not paying carriers, MCCS began paying carriers directly, for shipments for which it had not yet paid Salem. Estes sued Salem and the government, seeking to recover $147,645.33. The Claims Court dismissed, finding that there was no privity of contract between Estes and the government and rejecting a claim under 49 U.S.C. 13706, which governs the liability of consignees for shipping charges incurred by a common carrier. The Federal Circuit reversed and remanded, concluding that the bills of lading were sufficient to establish privity. View "Estes Express Lines v. United States" on Justia Law

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

In connection with construction of a pipeline to ship natural gas from Wyoming to Eastern Ohio, Rockies Express and Minerals Management Service (MMS), within the Department of the Interior, entered into contracts containing Royalty-in-Kind (RIK) provisions. Under the RIK program, the government receives its royalty for mineral resources extracted under federal leases “in kind,” i.e., in natural gas, rather than in cash, 30 U.S.C. 192; 42 U.S.C. 15902(b). In exchange, the government makes monthly payments to ensure that a certain quantity of the mineral resources is made available for its purposes. The government then enters into processing and transportation contracts to sell the mineral royalties, often at a substantial profit over royalties received in cash. The Civilian Board of Contract Appeals determined that MMS had materially breached the contract, but that Rockies Express was only entitled to damages that had accrued before the Secretary of the Interior announced a decision to phase-out RIK contracts. The Federal Circuit affirmed that MMS materially breached the contract, but reversed the decision to limit damages. Rockies Express is entitled to compensatory damages to put it in as good a position as that in which it would have been put by full performance of the contract. View "Rockies Express Pipeline, LLC v. Salazar" on Justia Law

Before the invasion of Iraq, KBR entered into contracts with the U.S. Army for the provision of dining facility (DFAC) services in Iraq. The contract at issue was for DFAC services at Camp Anaconda, one of the largest U.S. bases in Iraq. KBR subcontracted with Tamimi to provide services in Anaconda. As troop levels increased, the Defense Contract Auditing Agency (DCAA) engaged in audits of DFAC subcontracts. With respect to Anaconda, the DCAA concluded that KBR had charged $41.1 million in unreasonable costs for services provided from July 2004 to December 2004 and declined to pay KBR that amount. KBR sued and the government brought counterclaims, including a claim under the Anti-Kickback Act. The Court of Federal Claims held that KBR was entitled to $11,460,940.31 in reasonable costs and dismissed the majority of the government’s counterclaims, but awarded $38,000.00 on the AKA claim. The Federal Circuit affirmed the determination of cost reasonableness and dismissal of the government’s Fraud and False Claims Act claims and common-law fraud claim. The court remanded in part, holding that the Claims Court improperly calculated KBR’s base fee and erred in determining that the actions of KBR’s employees should not be imputed to KBR for purposes of the AKA. . View "Kellogg Brown & Root Servs, Inc. v. United States" on Justia Law

In 2011, the Forest Service solicited proposals for 34 line items, calling for a negotiated procurement process pursuant to Federal Acquisition Regulation Part 15. Each line item sought heavy or medium exclusive use helicopters for large fire support, tailored for a specific base and meeting performance specifications for operation at that base. Croman, an unsuccessful bidder, filed suit, alleging that the Forest Service’s evaluations of proposals did not have rational bases and were contrary to law. The Claims Court granted the government judgment on the administrative record. The Federal Circuit affirmed, finding that the Forest Service had a rational basis for its decision to partially cancel the solicitation and that the Service conducted a proper tradeoff analysis so that its decision was reasonable. View "Croman Corporation v. United States" on Justia Law