Contract Law News - Federal Circuit
Federal Circuit - The FindLaw Federal Circuit Court of Appeals Opinion Summaries Blog

Recently in Contract Law Category

In an effort to promote ownership of small businesses by veterans, Congress established a goal of awarding a certain percentage of Veterans Administration contracts to small businesses owned by both veterans and service-disabled veterans. In 2012, the VA chose to use an existing GSA contractor to install emergency notification services in several VA medical centers rather than put out bids for the work to veteran-owned businesses.

Kingdomware, a small business owned by a veteran, filed a complaint, claiming that the VA was required to solicit bids from veteran-owned small businesses before resorting to using an existing GSA contractor. The Court of Federal Claims found for the VA, and Kingdomware appealed.

In Kingdomware v. United States, the Federal Circuit Court affirmed the decision, 2-1.

Want to spend more time practicing, and less time advertising? Leave the marketing to the experts.

The Federal Circuit recently had the chance to hear an appeal involving antitrust issues. When we saw that, our ears perked up, as we can only take so much patent and veterans' appeals (sorry). How exactly did the Federal Circuit have jurisdiction to hear the appeal anyway?

The initial claims involved an allegation of patent infringement. Though the parties stipulated to the dismissal of the patent infringement claim, because the district court entered final judgment and dismissed the claim with prejudice, the Federal Circuit retained jurisdiction.

Now, let's get to the heart of the matter.

Nycal Offshore Development Corporation just learned a lesson on pushing things too far. It was one of several oil companies that were involved in litigation against the United States, beginning in 2002, over breach of contract claims related to the Government's actions preventing the oil companies from drilling.

All the other companies, except Nycal, accepted restitution awards from the Government.

Court of Federal Claims

Nycal, instead, took it further and sued for lost profits, and presumably to its surprise, lost. The Court of Federal Claims found that though the Government could have foreseen that damages would result from its breach, Nycal nonetheless did not prove that the Government actually caused the damages, and that the damages could not be reasonably calculated.

Metcalf Construction Company's bid was chosen for a Navy contract to build military housing in Oahu, Hawaii. Initially, the contract stated that Metcalf would build 188 units by March 2005, however after many modifications, the final agreement required 212 units by October 17, 2006 for an amount just below $50 million.

In the pre-request report, the Government included preliminary soil test results that could have impacted the building project, and noted that further testing was required once the project was started.

After Metcalf did its own testing, the results were far more serious than anticipated, which resulted in delays, additional costs, and changes to design.

The Federal Circuit addressed an issue of pure statutory construction in this case, where it had to determine the meaning of "competitive basis" under the Workforce Investment Act.

Contractors, subcontractors, and kickbacks. Is anyone even mildly surprised here?

During Operation Iraqi Freedom, the United States Army contracted with Halliburton subsidiary Kellogg Brown & Root, now known simply as KBR, to provide dining services. KBR, despite previous difficulties with the subcontractor, handed over operations of Camp Anaconda to Tamini Global Company.

After years of bills, adjustments, negotiations, and renegotiations, an Army audit found that KBR billed $41.1 million in unreasonable expenses, and refused to pay.

Wheelabrator designs, sells, and licenses some process (phosphate-based treatment systems) that keep heavy metals from industrial waste (such as incinerator ash) from leaching into drinking water. Forrester does too. Both have patents on their proprietary methods.

Wheelabrator licensed its system to a company that sublicensed it to a Taiwanese company, Kobin. That company was unhappy with the product, however, because it stank. Forrester, meanwhile, took that opportunity to develop a less smelly alternative, which it sold to Kobin, despite the existing deal with Wheelabrator.

You only get one shot. There is no second bite at the apple.

Whatever your idiomatic cliché of choice is, the principles of res judicata and claim preclusion mean you better get it right the first time. Bowers Investment Company just learned that lesson the hard way, as they will not be able to pursue a $60,000 claim that they missed in their initial trip to the courthouse.

In 1993, the Federal Aviation Administration leased a building from Bowers Investments. Though the terms of the contract called for rent payments to be made in arrears, in practice the payments were made on the first of the month for the current month. In 2006, the parties terminated the lease. Bowers later filed a claim with the contracting officer for one month's rent and damages to the property.

Federal Cir. Gives Raytheon Another Shot at Trade Secrets Case

The Federal Circuit Court of Appeals handed a huge victory to Raytheon Co. this week, giving the defense contractor another shot at pursuing its trade secret violation claims against Flir Systems Inc., reports Bloomberg News.

The case, which had been dismissed by a district court, has now been remanded. The three-judge panel of the Federal Circuit Court of Appeals ruled that the district court had dismissed the case in error when it granted Indigo’s motion for summary judgment.

Fishy Ruling? Ministerial Error Not Abuse of Discretion

We love fresh fish.

Ideally, we would purchase all of our fish from an ocean-side fishmonger, but most of the time that's not in the cards. Instead, we have to go to restaurants. While the restaurant arguably involves less hassle, it presents a financial obstacle: the market price. We feel awkward asking waiters about the market price, and we usually either choose a lesser fish with a noted price, or cross our fingers that we haven't blown our rent on a single meal.

After reading this week's Federal Circuit Court of Appeals opinions, we now realize that we simply need to befriend a Federal Circuit judge or a federal trade employee for future fish-dining outings, because they are well-versed in fish pricing.