United States v. Renda Marine, Inc.

Decision Date13 January 2012
Docket NumberNo. 10–41296.,10–41296.
Citation667 F.3d 651
PartiesUNITED STATES of America, Plaintiff–Appellee, v. RENDA MARINE, INC., Defendant–Appellant.
CourtU.S. Court of Appeals — Fifth Circuit


John Robert Kresse, Trial Atty. (argued), Commercial Lit. Branch, Charles Edward Canter, Trial Atty., U.S. Dept. of Justice, Civ. Div., Washington, DC, for PlaintiffAppellee.

David E. Keltner (argued), Marianne Marsh Auld, Jody Scott Sanders, William Nolan Warren, Kelly, Hart & Hallman, L.L.P., Fort Worth, TX, Terry Lee Salazar, Brent Samuel Lee, Quilling, Selander, Lownds, Winslett & Moser, P.C., Dallas, TX, for DefendantAppellant.

Appeal from the United States District Court for the Eastern District of Texas.Before BENAVIDES and PRADO, Circuit Judges, and ALVAREZ, District Judge.*BENAVIDES, Circuit Judge:

In this case, Renda Marine, Inc. (Renda) appeals the district court's denial of its motion for partial dismissal for lack of subject matter jurisdiction and motion for partial summary judgment. Renda also appeals the district court's grant of the Government's motion for judgment on the pleadings. For the following reasons, we AFFIRM.

I. Factual and Procedural Background

In October 1998, Renda contracted with the Army Corps of Engineers to dredge a portion of the Houston Ship Channel and to construct containment levees and other structures at a disposal facility for dredge material. Renda experienced difficulties with the dredging and construction work, including allegedly unexpected site conditions that made completion of the work at the original contract price impossible. Renda submitted its claims for additional compensation to a contracting officer (“CO”) pursuant to the Contracts Dispute Act (“CDA”), 41 U.S.C. § 601, et seq.1 The CO issued a unilateral contract modification in favor of Renda that increased the contract price by $3,083,833. The Army Corps of Engineers paid Renda this amount. Unsatisfied with the decision, Renda filed suit in the Court of Federal Claims (“CFC”) to recover an additional $906,364. The CFC determined that Renda was entitled to neither the additional $906,364 it sought, nor the equitable adjustment of $3,083,833 made by the CO.

While Renda's modification suit was pending before the CFC, the CO issued a final decision on six different claims the Government had brought against Renda for post-termination costs of completing certain aspects of the work originally covered by the contract. The CO granted the total amount of those claims, which was $11,860,016. The CO's decision also stated that the Government withheld $259,840.85 in retainage. Renda did not appeal this decision directly. Rather, on July 1, 2004, Renda sought leave to amend its complaint in the ongoing CFC litigation to challenge the CO's decision granting the Government $11,860,016. The CFC denied Renda's motion and the Federal Circuit affirmed that denial.

On November 24, 2008 the Government filed the present lawsuit in federal district court, seeking to enforce the decisions of the CFC. In Count I, the Government alleges that Renda owes it $11,860,016, pursuant to the CO's decision on the six counterclaims. In Count II, the Government seeks repayment of $3,083,833—the amount paid to Renda in excess of the original contract price—based on the CFC's determination that Renda was not entitled to any equitable adjustment of the contract price.

Renda filed a motion for partial dismissal, arguing that the district court lacked subject matter jurisdiction over Count II of the complaint because the Government allegedly failed to comply with the requirements of the CDA. Renda also filed a motion for partial summary judgment, arguing that the statute of limitations barred Count I. On September 30, 2010, the district court denied Renda's motions, granted the Government's motion for judgment on the pleadings on both claims, and entered judgment against Renda. The district court held that it had jurisdiction to enforce the CFC's decision that Renda was not entitled to the $3,083,833 the Government had paid it, and that the Government had timely filed its suit to enforce the $11,860,016 judgment against Renda. The district court also held that Renda was not entitled to any offset of the Government's recovery based on funds the Government had kept in retainage. Renda then timely filed this appeal of the district court's judgment.

II. Standard of Review

A challenge to this court's subject matter jurisdiction may be raised at any time on appeal. Arbaugh v. Y & H Corp., 546 U.S. 500, 506, 126 S.Ct. 1235, 163 L.Ed.2d 1097 (2006); Edge Petroleum Operating Co. v. GPR Holdings, L.L.C. (In re TXNB Internal Case), 483 F.3d 292, 298 n. 6 (5th Cir.2007). When considering a motion to dismiss for lack of subject matter jurisdiction, a district court may consider: (1) the complaint alone; (2) the complaint supplemented by undisputed facts evidenced in the record; or (3) the complaint supplemented by undisputed facts plus the court's resolution of disputed facts.” Rodriguez v. Christus Spohn Health Sys. Corp., 628 F.3d 731, 734 (5th Cir.2010) (quoting Ramming v. United States, 281 F.3d 158, 161 (5th Cir.2001)). The party asserting jurisdiction has the burden of proof. Ramming, 281 F.3d at 161.

We review de novo a district court's grant of judgment on the pleadings under Federal Rule of Civil Procedure 12(c). Brittan Communs. Int'l Corp. v. Sw. Bell Tel. Co., 313 F.3d 899, 904 (5th Cir.2002). [W]e must look only to the pleadings and accept all allegations contained therein as true.” Id. “The issue is not whether the plaintiffs will ultimately prevail, but whether they are entitled to offer evidence to support their claims.” Ferrer v. Chevron Corp., 484 F.3d 776, 780 (5th Cir.2007).

We also apply a de novo standard of review to a motion to dismiss under Rule 12(b)(1), and motions for summary judgment under Rule 56. LeClerc v. Webb, 419 F.3d 405, 413 (5th Cir.2005). Summary judgment is appropriate if the moving party can show that “there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). “A factual dispute is ‘genuine’ where a reasonable party would return a verdict for the non-moving party.” Chiu v. Plano Indep. Sch. Dist., 339 F.3d 273, 282 (5th Cir.2003) (citation omitted). In considering a summary judgment motion, we view the evidence in the light most favorable to the non-moving party. United Fire & Cas. Co. v. Hixson Bros., Inc., 453 F.3d 283, 285 (5th Cir.2006). However, [u]nsubstantiated assertions, improbable inferences, and unsupported speculation are not sufficient to defeat a motion for summary judgment.” Brown v. City of Houston, 337 F.3d 539, 541 (5th Cir.2003).

III. Analysis
A. The Contract Disputes Act

“The Contract Disputes Act is a comprehensive statutory scheme for resolving contractual conflicts between the United States and government contractors.” United States v. J & E Salvage Co., 55 F.3d 985, 987 (4th Cir.1995); Menominee Indian Tribe v. United States, 614 F.3d 519, 521 (D.C.Cir.2010) (accord); Anselma Crossing, L.P. v. United States Postal Serv., 637 F.3d 238, 246 (3d Cir.2011) (stating that “the policy goals of the CDA [are] to collect contract disputes against the government in a forum ... with both the requisite expertise and the ability to provide consistency in applying the laws related to government contracts”). The CDA applies to any express or implied contract entered into by an executive agency for: (1) the procurement of property, other than real property in being; (2) the procurement of services; (3) the procurement of construction, alteration, repair or maintenance of real property; or, (4) the disposal of personal property.” 41 U.S.C. § 602(a). “It is well-established therefore that disguised contract actions may not escape the CDA.” J&E Salvage Co., 55 F.3d at 988 (noting that the source of the rights the government sought to vindicate were based in contract, even though the government styled its action as one sounding in tort); Trevino v. Gen. Dynamics Corp., 865 F.2d 1474, 1489 (5th Cir.1989) (finding claim subject to CDA, as essence of claim was to obtain money from the government).

The CDA was intended “to streamline the settlement of controversies over federal government contracts,” and it “generally affords private contractors a two-step review process.” Bethlehem Steel Corp. v. Avondale Shipyards, Inc., 951 F.2d 92, 93 (5th Cir.1992). First, there must be a final decision by a CO on a claim before that claim can be submitted to a federal court. Trevino, 865 F.2d at 1489 (“The decision, or failure to decide, by a contracting officer is an absolute jurisdictional prerequisite to filing a suit under the Contract Disputes Act.”); see also, e.g., J&E Salvage Co., 55 F.3d at 987; Menominee Indian Tribe, 614 F.3d at 521; Sharman Co. v. United States, 2 F.3d 1564, 1566 (Fed.Cir.1993), overruled on other grounds by Reflectone, Inc. v. Dalton, 60 F.3d 1572 (Fed.Cir.1995) (en banc) 2; Transamerica Ins. Corp. ex rel. Stroup Sheet Metal Works v. United States, 28 Fed.Cl. 418, 422 (1993). After a CO has issued a decision, a party may appeal that decision to the relevant board of contract appeals within 90 days, or file suit in the CFC within 12 months. Menominee Indian Tribe, 614 F.3d at 521.

A claim has been defined as “the assertion as a matter of right to a sum certain as presently due and owing, on which there was a final decision by the contracting officer.” Sharman Co., 2 F.3d at 1567; see also Joseph Morton Co. v. United States, 757 F.2d 1273, 1281 (Fed.Cir.1985) (stating that the word “claim” does not mean “the whole case between the contractor and the Government,” but instead, it means “each claim under the CDA for money that is one part of a divisible case.”); United States v. Intrados/Int'l Mgmt. Grp., 277 F.Supp.2d 55, 64 (D.D.C.2003) (“A valid claim submitted to a contracting officer includes such routine submissions as ...

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