Justia Contracts Opinion Summaries

In 2010, the Army granted Authentic a nonexclusive license to manufacture and sell clothing bearing the Army’s trademarks. The agreement required the Army’s advance written approval of any products and marketing materials bearing the Army’s trademarks and included exculpatory clauses that exempted the Army from liability for exercising its discretion to deny approval. In 2011-2014, Authentic submitted nearly 500 requests for approval; the Army disapproved 41 submissions. During that time, Authentic received several formal notices of material breach for claimed failures to timely submit royalty reports and pay royalties. Authentic eventually paid its royalties through 2013. Authentic’s counsel indicated that Authentic would not pay outstanding royalties for 2014.Authentic's ensuing breach of contract suit cited the Army’s denial of the right to exploit the goodwill associated with the Army’s trademarks, refusal to permit Authentic to advertise its contribution to Army recreation programs, delay of approval for a financing agreement, denial of approval for advertising, and breach of the implied duty of good faith and fair dealing by not approving the sale of certain garments. The Federal Circuit affirmed summary judgment in favor of the government. The license agreement stated in no uncertain terms that the Army had “sole and absolute discretion” regarding approval of Authentic’s proposed products and marketing materials; the exercise of that broad approval discretion is not inconsistent with principles of trademark law. View "Authentic Apparel Geoup, LLC v. United States" on Justia Law

In 2017, the Department of Homeland Security issued the Solicitation as a Request for Proposal for a potentially multi-year contract for dorm management services at the Federal Law Enforcement Training Center in Glynco, Georgia. During the evaluation process, the government eliminated Safeguard’s proposal from consideration because Safeguard omitted pricing information for 16 contract line item numbers totaling $6,121,228.The Claims Court and Federal Circuit upheld the award to another bidder. The Solicitation required offerors to submit the pricing information and provided notice that elimination was possible if that pricing information was omitted. Safeguard’s omissions were material and not subject to waiver or clarification. The court upheld the denial of Safeguard’s email request to supplement the administrative record through discovery and the denial of its motion to supplement the administrative record with affidavits. The Claims Court had jurisdiction over a claim that the government breached an implied-in-fact contract to fairly and honestly consider an offeror’s proposal in the procurement context under 28 U.S.C. 1491(b)(1). View "Safeguard Base Operations, LLC v. United States" 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

The Supreme Court affirmed the circuit court's dismissal of West Virginia Counties Group Self-Insurance Risk Pool, Inc.'s (WVCoRP) claims against Great Cacapon Volunteer Fire Department, Inc. (VFD), holding that the circuit court did not err.When a fire destroyed the building where VFD was housed, the owner of the building, the Morgan County Commission, was reimbursed for the loss by WVCoRP. Seeking to recover the funds it expended, WVCoRP sued the VFD and other parties for negligence. In the process, WVCoRP invoked a contractual right to subrogation. The circuit court determined that the claims against VFD were barred by W. Va. Code 29-12A-13(c), which prohibits claims against political subdivisions made under a right of subrogation. The Supreme Court affirmed, holding (1) WVCoRP's claims spring from its coverage contract with the Commission and fall within any plain meaning of subrogation; and (2) section 29-12A-13(c) is not an insurance law of the State from which WVCoRP is exempt. View "West Virginia Counties Group v. Great Cacapon Volunteer Fire Department, Inc." on Justia Law

After the Mississippi Department of Public Safety (MDPS) reinterpreted a provision in a contract between it and the Mann Agency, LLC, the MDPS refused to pay more than $700,000 in invoices submitted by the Mann Agency. The Mann Agency filed suit against the MDPS for breach of contract. The trial court dismissed each party’s breach-of-contract claim, found that the case involved a bona fide dispute, and denied the Mann Agency’s claim for interest and attorneys’ fees. The Mann Agency appealed the trial court’s decision to deny its claim for interest and attorneys’ fees, arguing that the MDPS acted in bad faith. The MDPS cross-appealed, arguing the trial court erred by dismissing as moot its breach-of-contract claim. Finding no reversible error, the Mississippi Supreme Court affirmed the trial court's decisions. View "Mann Agency, LLC v. Mississippi Department of Public Safety" on Justia Law

In 2003, the government awarded Parsons a $2.1 billion indefinite-delivery, indefinite-quantity contract for planning and construction work to be described in subsequent task orders. In 2005, the government issued a $34 million task order to complete an existing, concept-level design and construct the Temporary Lodging Facility and Visiting Quarters, at the McGuire Air Force Base. Design and construction were completed. The Air Force accepted the completed facilities for “beneficial use” in September 2008. In 2012, Parsons submitted a claim for approximately $34 million in additional costs that Parsons allegedly incurred in the design and construction process. The Armed Services Board of Contract Appeals awarded Parsons about $10.5 million plus interest.The Federal Circuit reversed in part after holding that the Board had Contracts Dispute Act jurisdiction 41 U.S.C. 7102(a)(1), (3). The court dismissed Parsons’ appeal as to its payroll claim and reversed the Board’s denial of recovery to Parsons for its claim to construction costs. On remand, the Board must award Parsons the difference between its cost in constructing a substituted design compared to the cost Parsons would have incurred in constructing a structural brick design. The court affirmed the Board’s conclusion that Parsons’ costs awarded by the Board were reasonable. View "Parsons Evergreene, LLC v. Secretary of the Air Force" on Justia Law

The Supreme Court held that a provision in the Office of the State Public Defender's contract with private attorneys specifying that hourly compensation rates can unilaterally be changed by the State permits prospective changes in a contract attorney's compensation rate for existing cases.Appellants, private attorneys who contract with OPD to provide legal services for indigent clients, filed a class action complaint against the State, the Governor, and the Director of the Office of the State Public Defender (OPD) alleging that Defendants were liable for breach of contract or in violation of the Contract Clause stemming from the OPD's act of reducing rates for all contracted services and reducing pay for case-related travel. The district court granted the State's motion for summary judgment, ruling that the OPD did not breach its contract with Appellants because the contract specifically identified that the fee arrangement was subject to change by the Director. The Supreme Court affirmed, holding that summary judgment was properly granted for the State. View "Brooke v. State" on Justia Law

The Council handles contracts for over 200 New Jersey municipalities, police departments, and school districts. Mid-American sells bulk road salt. The Council's members estimated their salt needs for the 2016-17 winter. The Council issued a comprehensive bid package, anticipating the need for 115,000 tons of rock salt. MidAmerican won the contract, which stated: There is no obligation to purchase [the estimated] quantity. As required by the contract, Mid-American obtained a performance bond costing $93,016; imported $4,800,000 worth of salt from Morocco; and paid $31,250 per month to store the salt and another $58,962.26 to cover it. Mid-American incurred at least another $220,000 in finance costs and additional transportation costs. Council members purchased less than five percent of the estimated tonnage. Mid-American claims “several” Council members purchased salt from MidAmerican’s competitors, who lowered their prices after MidAmerican won the contract.Mid-American sued the Council and 49 of its members, alleging breach of contract, breach of the covenant of good faith and fair dealing, and bad faith under UCC Article 2. The Third Circuit affirmed the denial of relief. No valid requirements contract existed here because the contract was illusory. These sophisticated parties were capable of entering into precisely the contract they desired. Neither the Council nor its members ever promised to purchase from Mid-American all the salt they required View "Mid-American Salt LLC v. Morris County Cooperative Pricing Council" on Justia Law

ACC, the subcontractor on a Corps flood protection project, filed suit against the prime contractor, Hirani, for breach of contract and the providers of Hirani's payment bond, Colonial, under the Miller Act for unpaid labor and materials. The district court entered judgment in favor of ACC and awarded damages against both defendants.The DC Circuit remanded the case to the district court to make findings of fact as to when the Prime Contract was terminated and whether ACC performed labor or supplied material on April 29 and/or April 30. In the event that Colonial and Hirani cannot meet their burden to show that ACC's Miller Act claim was untimely, then this court can resolve the parties' other Miller Act contentions. If Hirani and Colonial show that termination occurred before April 29 or that ACC performed no labor or supplied no material on April 29 or 30, the court can then address the Miller Act statute of limitations issue. The court affirmed the restitution damages award against Hirani on ACC's contract claim where ACC has not provided the court with any basis to deviate from the principle of D.C. law that restitution, not quantum meruit, is the proper remedy where there is an express contract between the parties. The court deferred addressing other issues raised by the parties. View "United States v. Hirani Engineering & Land Surveying, PC" on Justia Law

The Supreme Court held that the Expedited Declaratory Judgment Act (EDJA), Tex. Gov't Code ch. 1205, gave the trial court jurisdiction to declare whether contracts executed by the San Jacinto River Authority were legal and valid but not whether the Authority complied with the contracts in setting specific water rates.The Authority, which has contracts to sell water to cities and other customers and uses the revenue to pay off its bonds, filed suit seeking declarations under the EDJA regarding the contracts and the water rates set under those contracts. Several participants, including three cities (Cities) opted in as interested parties. The Cities filed pleas to the jurisdiction, arguing that the trial court lacked subject matter jurisdiction to adjudicate the Authority's claims. The trial court denied the pleas to the jurisdiction. The court of appeals held primarily for the Authority. The Supreme Court held (2) the EDJA permits the trial court to exercise jurisdiction over the Authority's claims as to the valid execution of the contracts, but it does not confer jurisdiction over whether the Authority complied with the contracts in setting specific water rates; and (2) the Cities' governmental immunity does not bar an EDJA claim, which is brought in rem to adjudicate interests in property. View "City of Conroe, Texas v. San Jacinto River Authority" on Justia Law