M.E.S., Inc. v. Snell

• Decision Date: 19 March 2013
• Docket Number: Docket No. 12–1657–cv.
• Citation: 712 F.3d 666
• Parties: M.E.S., INC., George Makhoul, Plaintiffs–Appellants, v. Ella SNELL, in her individual capacity, Raynette Gurney, in her individual capacity, Christopher Nastasi, in his individual capacity, Anthony Levesanos, in his individual capacity, Defendants–Appellees.
• Court: U.S. Court of Appeals — Second Circuit

712 F.3d 666

M.E.S., INC., George Makhoul, Plaintiffs–Appellants,

v.Ella SNELL, in her individual capacity, Raynette Gurney, in her individual capacity, Christopher Nastasi, in his individual capacity, Anthony Levesanos, in his individual capacity, Defendants–Appellees.

Docket No. 12–1657–cv.

United States Court of Appeals,Second Circuit.

Submitted: Nov. 7, 2012.

Decided: March 19, 2013.

Edward T. DeLisle, Cohen Seglias Pallas Greenhall & Furman, PC, Philadelphia, PA, for Plaintiffs–Appellants.

Bertrand Madsen, Sarah S. Normand, for Preet Bharara, United States Attorney for the Southern District of New York, New York, NY, for Defendants–Appellees.

Before: B.D. PARKER, RAGGI, and LYNCH, Circuit Judges.

REENA RAGGI, Circuit Judge:

Plaintiff M.E.S., Inc. (“MES”), claims that the U.S. Army Corps of Engineers (“Corps”) unfairly terminated three of its construction/renovation contracts. After its administrative challenges to these terminations were dismissed without prejudice—to allow MES and its insurer to determine which of them would manage those proceedings—MES and its President, George Makhoul, filed this action in the United States District Court for the Southern District of New York (Laura Taylor Swain, Judge ). Invoking Bivens v. Six Unknown Named Agents of Federal Bureau of Narcotics, 403 U.S. 388, 91 S.Ct. 1999, 29 L.Ed.2d 619 (1971), MES and Makhoul sued named Corps personnel in their individual capacities, alleging that their contracts were terminated in retaliation for criticism by MES of the Corps' mismanagement of construction projects, that these terminations negatively impacted MES's business, and that, as a result, they were deprived of their constitutionally protected rights to free speech and substantive due process. MES and Makhoul now appeal from a judgment entered on March 27, 2012, dismissing their complaint. See M.E.S., Inc. v. Snell, 10 Civ. 9513(LTS), 2012 WL 1003570 (S.D.N.Y. Mar. 26, 2012). They contend that the district court erred as a matter of law in ruling that their Bivens action was precluded by the Contract Disputes Act of 1978 (“CDA”), see41 U.S.C. § 7101 et seq.

As a preliminary matter, we lack jurisdiction to review this claim as advanced by Makhoul because the text and caption of the original timely notice of appeal, dated April 24, 2012, failed to identify him as a party appealing from the judgment. See generallyFed. R.App. P. 3(c)(1)(A) (stating that notice of appeal must “specify the party or parties taking the appeal by naming each one in the caption or body of the notice”). “The requirement that a party seeking to appeal be specified in the notice of appeal is jurisdictional.” Gusler v. City of Long Beach, 700 F.3d 646, 648 (2d Cir.2012) (dismissing appeal by party identified in caption but not named in body of notice of appeal); see Torres v. Oakland Scavenger Co., 487 U.S. 312, 314, 108 S.Ct. 2405, 101 L.Ed.2d 285 (1988) (holding that failure to name party in notice of appeal is “more than excusable ‘informality’; it constitutes a failure of that party to appeal”). An amended notice naming Makhoul as an appellant was not filed until June 14, 2012, beyond the 60–day limit prescribed by Fed. R.App. P. 4(a)(1)(B). That time limit is also jurisdictional in civil cases, see Napoli v. Town of New Windsor, 600 F.3d 168, 170 (2d Cir.2010) (citing Bowles v. Russell, 551 U.S. 205, 214, 127 S.Ct. 2360, 168 L.Ed.2d 96 (2007)), and Makhoul's failure to abide by it or to seek an extension renders his belated filing inoperative, see Gusler v. City of Long Beach, 700 F.3d at 650. Accordingly, we hereby dismiss Makhoul's appeal and hereafter address only MES's challenge to the judgment of dismissal.

Although this court has not previously considered the preclusive effect of the CDA on Bivens claims, two of our sister circuits have done so and concluded that the statute's complex procedural and substantive framework is comprehensive, precluding Bivens claims by aggrieved government contractors that relate to or derive from contract disputes. See Evers v. Astrue, 536 F.3d 651, 657 (7th Cir.2008); Janicki Logging Co. v. Mateer, 42 F.3d 561, 564–65 (9th Cir.1994). District courts appear uniformly to have reached the same conclusion in published and unpublished decisions. See Aryai v. Forfeiture Support Assocs., LLC, No. 10 Civ. 8952(LAP), 2012 U.S. Dist. LEXIS 125227, at *55 (S.D.N.Y. Aug. 27, 2012); Kesler Enters., Inc. v. U.S. Dep't of Agric., No. 4:10–CV–169–BLW, 2010 WL 4641360, at *5–6 (D.Idaho Nov. 4, 2010); Research Air, Inc. v. Norton, No. 05–623(RMC), 2006 WL 508341, at *8 n. 8 (D.D.C. Mar. 1, 2006); Teel v. DiLeonardi, No. 98 C 2568, 1999 WL 133997, at *3 (N.D.Ill. Mar. 5, 1999); Information Sys. & Networks Corp. v. U.S. Dep't of HHS, 970 F.Supp. 1, 10 (D.D.C.1997); Advanced Materials, Inc. v. Burgess, No. 94–2808, 1995 WL 25891, at *2 (E.D.La. Jan. 23, 1995), aff'd,95 F.3d 47 (5th Cir.1996) (unpublished table decision). We agree with these courts' analysis of the CDA, as well as with the district court's application of that reasoning to MES's Bivens claims in this case. Accordingly, we affirm the challenged judgment of dismissal.

I. BackgroundA. Termination of MES's Contracts

MES is a New York corporation that specializes in building complex structures such as laboratories, weapons testing facilities, and warehouses for munitions and explosives. Since 1992, it has performed construction work for the United States Department of Defense, specifically for the Army Corps of Engineers. Between September 19, 2003, and September 29, 2006, the Corps awarded MES three contracts for work to be performed at the Picatinny Arsenal in Dover, New Jersey (“Arsenal contracts”).

The first contract, awarded to MES as part of a joint venture, related to the construction of a High Energy Propellant Formulation Facility, requiring the design and erection of thirteen new buildings and the renovation of three existing structures at a price of $16,549,000. The second contract, concerning the construction of an Explosive Research and Development Loading Facility, required MES to design and erect three new buildings and to renovate one existing building for a sum of $7,262,975. The third contract, relating to development of a Pyrotechnics Research and Technology Facility, called on MES to construct a pyrotechnics research center and flare tunnel for $10,628,832. Each of these contracts incorporated the “Disputes” provision of the Federal Acquisition Regulations, which subjected the agreements “to the Contract Disputes Act of 1978, as amended.” 48 C.F.R. § 52.233–1(a).

It is undisputed that none of the Arsenal contracts was performed according to its specifications. Thus, between March and December 2008, the Corps provided MES with written notice that, as a result of significant and unacceptable delays, it was terminating each of the contracts for default. Each notice stated that it “constitute[d] the final decision of the Contracting Officer in accordance with the Disputes Clause of the contract,” and advised MES that, pursuant to the CDA, it could “appeal[ ] to the Armed Services Board of Contract Appeals” or “bring an action directly in the United States Court of Federal Claims.” Mar. 5, 2008 Notice of Termination 19; Nov. 4, 2008 Notice of Termination 17; Dec. 22, 2008 Notice of Termination 25.

B. MES's CDA Challenges to the Contract Terminations

Invoking the CDA, MES challenged the terminations of its Arsenal contracts before the Armed Services Board of Contract Appeals (“ASBCA”). See41 U.S.C. §§ 7104(a), 7105(a). There, MES asserted that the Corps was responsible for the delays attending each contract due to myriad specifications defects and demands for additional unfunded work beyond that required by the original agreements. MES charged the Corps with breaching each of the Arsenal contracts, claimed that the terminations were arbitrary and improper, and asked that all three terminations for default be converted to terminations for convenience.

While these ASBCA proceedings were pending, Safeco Insurance Company of America (“Safeco”), MES's surety on the three Arsenal contracts, filed suit in the United States District Court for the Eastern District of New York, alleging that MES had breached the parties' indemnity agreements and that Safeco was thus entitled to assume ownership of MES's affirmative claims relating to the Arsenal contracts, including those before the ASBCA. After the district court awarded Safeco partial summary judgment—a decision we affirmed, see Safeco Ins. Co. of Am. v. Hirani/MES, JV, 480 Fed.Appx. 606 (2d Cir.2012) (summary order)—MES requested that the ASBCA stay the administrative proceedings pending resolution of the rights and intentions of Safeco, which MES feared might not vigorously press its claim that the Corps had breached the Arsenal contracts. Instead, but for the same purpose, on September 10, 2010, the ASBCA dismissed MES's appeals without prejudice. See ASBCA R. 30 (effective May 11, 2011), http:// www. asbca. mil/ Rules/ forms/ Rules 11 May 2011. pdf (authorizing dismissal without prejudice in Board's discretion, which “shall be deemed with prejudice” if neither party seeks reinstatement within three years).

C. District Court Proceedings

MES did not seek to reopen proceedings before the ASBCA. Rather, on December 22, 2010, MES and Makhoul commenced this action in the Southern District of New York against defendants Ella Snell, a contracting officer in the Corps' New York District; Raynette Gurney, the Corps' Chief of Contracting for the North Atlantic Division; Christopher Nastasi, an administering contracting officer in the New York District; and Anthony Levesanos, a Corps program manager. In the Second Amended Complaint, the pleading pertinent to this appeal, MES and Makhoul claimed that by terminating the Arsenal contracts for default, these defendants had (1) deprived plaintiffs of substantive due process under the Fifth Amendment by...