Articles Posted in Government Contracts

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The State of Alabama, on behalf of Rick Allison, Probate Judge of Walker County, appealed a Walker Circuit Court judgment entered in favor of Jill Farris, the county administrator for Walker County. By statute, Judge Allison, as the chief elections officer for Walker County, must publish certain voter lists and election notices. Judge Allison argued on appeal, as he did in the circuit court, that he had the authority to determine in which newspaper of general circulation notices would be published and that he could also contract with that newspaper for the cost of publishing the notices. Farris argued Judge Allison did not follow established procedure by obtaining competitive bids for the pricing of such publishing. The Supreme Court As chief election officer for Walker County pursuant to statute, Judge Allison could contract to publish the notices he is required to publish. The Court reversed the circuit court's judgment insofar as it held otherwise. The case was remanded for further proceedings, including a determination of whether Judge Allison substantially complied with the competitive-bid law and, if so, whether Judge Allison's request for attorney fees was appropriate. View "State of Alabama ex rel. Allison, v. Farris" on Justia Law

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Alabama Mutual Insurance Corporation ("AMIC") appealed the trial court's order certifying a class in the action filed by the City of Vernon and a class of similarly situated entities that had purchased uninsured motorist/underinsured-motorist coverage ("UM/UIM coverage") from AMIC. Vernon was the original class representative; however, after AMIC filed its notice of appeal of the class-certification order, Vernon settled its claims against AMIC and withdrew as the class representative. Because there was no longer a representative to "fairly and adequately protect the interests of the class," the Supreme Court remanded the case back to the trial court for a new class representative to be substituted for Vernon. The City of Fairfield substituted for Vernon as the class representative. After review of the parties' arguments on appeal, the Supreme Court did not reach the merits of the underlying dispute: the Court concluded that the trial court lacked subject-matter jurisdiction over this dispute. Initial jurisdiction over this dispute was with the Alabama Department of Insurance and its commissioner. Therefore, the Supreme Court vacated the trial court's class-certification order, and remanded for dismissal. View "Alabama Mutual Insurance Corporation v. City of Fairfield" on Justia Law

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The Jackson County Board of Education petitioned for a writ of mandamus to direct the Circuit Court to enter an order dismissing the complaint of D.C. Pruett Contracting Company, Inc. on the ground of sovereign immunity. Pruett Contracting submitted a proposal for renovations to the Pisgah High School gymnasium. The Jackson County superintendent of education executed a purchase order authorizing Pruett Contracting to make certain renovations to the gymnasium, totaling $231,309. Pruett Contracting then began renovating the gymnasium. The Superintendent later received a letter from the State of Alabama Building Commission stating that "all work on the renovation of the Pisgah High School gymnasium [was] to stop immediately" because the project had not been submitted to or approved by the Building Commission. The Board instructed Pruett Contracting to cease all work on the gymnasium. Pruett Contracting submitted an invoice to the Board for the work that had been performed prior to the letter. Months later, because it had not received payment for its work, Pruett Contracting sued the Board, alleging breach of contract and unjust enrichment and seeking recovery of damages on theories of quantum meruit, work and labor done, open account, and account stated. The Board moved the court to dismiss the complaint, arguing that it was entitled to sovereign immunity as to the claims alleged by Pruett Contracting and that the court therefore lacked subject-matter jurisdiction over the action. Pruett Contracting responded, arguing that this case involved a protected property interest, that immunity was thus precluded, and that the court had subject-matter jurisdiction over the action. The Supreme Court concluded the Board established that it was entitled to sovereign immunity and that the trial court did not have subject-matter jurisdiction over this action; therefore, the action had to be dismissed. Because the Board demonstrated a clear legal right to an order directing the Circuit Court to dismiss Pruett Contracting's complaint, the Supreme Court granted the Board's petition for a writ of mandamus and directed the Circuit Court to dismiss Pruett Contracting's complaint. View "D.C. Pruett Contracting Company, Inc. v. Jackson County Board of Education" on Justia Law

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This case involves a dispute between Bessemer Water Service (BWS) and Lake Cyrus Development Company, Inc. (LCDC) over a contract referred to as the "1998 water agreement." In "Bessemer I," the Supreme Court concluded that the trial court had exceeded its discretion in holding that the 1998 water agreement was a valid binding contract and in awarding LCDC $224,979.83 because the agreement was entered into violation of section 39-2-2 and was therefore void. On appeal, the Attorney General intervened and filed a complain seeking to recover payments BWS made to LCDC under the 1988 water agreement. The trial court ultimately entered a judgment in favor of the Attorney General (for the benefit of BWS). LCDC thereafter filed a postjudgment motion requesting the trial court alter, amend or vacate its judgment, or in the alternative, order a new trial. The trial court denied LCDC's motion; that denial was brought before the Supreme Court in this case. After review, the Supreme Court held the trial court's denial of LCDC's motion should have been reversed. The case was then remanded for further proceedings. View "Lake Cyrus Development Company, Inc. v. Bessemer Water Service " on Justia Law

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Hosea O. Weaver & Sons, Inc. appealed a jury verdict in favor of Ira Balch, personal representative of the Estate of Danny Balch, and Melvin Balch, personal representative of the estates of Bernard Balch and Armie Balch. The matter stemmed from a road-resurfacing project conducted by the Alabama Department of Transportation (ALDOT). ALDOT hired Weaver to complete the project. The Balches were traveling on the portion of the road resurfaced by Weaver when the vehicle they were riding in was hit head-on by a tractor-trailer. Their personal representatives filed wrongful-death actions against Weaver and others, alleging that Weaver negligently performed the resurfacing project, and that negligent performance caused the deaths of the Balches. The trial court denied Weaver's prejudgment motions, and the jury returned a verdict in the estates' favor. Weaver appealed the denial of its postjudgment motion, and alleged multiple errors at trial in its argument to the Supreme Court. Upon review, the Supreme Court concluded that Weaver owed no duty to the decedents, and therefore was entitled to judgment as a matter of law. The Court reversed the trial court and entered a judgment in favor of Weaver. View "Hosea O. Weaver & Sons, Inc. v. Balch" on Justia Law

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The Phenix City Board of Education ("the Board") sought mandamus relief from the Russell Circuit Court's denial of the Board's motion to dismiss or, in the alternative, for a summary judgment on claims brought against it by The Lisle Company, Inc. ("Lisle"). Because the Board is immune from suit pursuant to § 14, Ala. Const. 1901, the Supreme Court granted the Board's petition and issued the writ. View "Lisle Company, Inc. v. Phenix City Board of Education" on Justia Law

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Defendant Sandoz, Inc. appealed a judgment entered on a jury verdict in favor of the State of Alabama. The State alleged at trial that Sandoz, a manufacturer of generic pharmaceuticals, purposely reported inflated pricing information for generic drugs in third-party publications and that the State, using those published prices, overpaid certain reimbursements to providers of prescription drugs made pursuant to the Medicaid program. The State thus sued Sandoz seeking damages under various theories of fraud. Previously, in "AstraZeneca LP v. Alabama," (41 So. 3d 15 (Ala. 2009)), the State unsuccessfully sued manufacturers of brand-name pharmaceuticals under the same theories. Because in this case, as in "AstraZeneca," the State knew that the prices reported by Sandoz were not what the State claims they should have been, Alabama law does not allow the State to claim that its reliance on that information was reasonable. Further, the State's reimbursement decisions were not based on the allegedly false information provided by Sandoz; instead, its decisions were based on policy concerns and certain requirements of the federal Medicaid program. Thus, as was the case in "AstraZeneca," the State's claims should not have been submitted to the jury, and Sandoz was entitled to a judgment in its favor. Therefore, the Supreme Court reversed the trial court's judgment and rendered judgment in favor of Sandoz. View "Sandoz, Inc. v. Alabama " on Justia Law

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Monte Sano Research Corporation ("MSRC"), Steven L. Thornton, and Steven B. Teague appealed a preliminary injunction entered against them in an action brought by Kratos Defense & Security Solutions, Inc.; Digital Fusion, Inc. ("DFI"), and Digital Fusion Solutions, Inc. ("DFSI") alleging breach of the duty of loyalty, breach of contract, tortious interference with business and contractual relationships, and civil conspiracy. Additionally, Kratos sought injunctive relief. Thornton and Teague were employees of DFI, which also engaged in government subcontract work; they became employees of Kratos when Kratos Defense merged with DFI in 2008. In February 2009, Thornton and Teague met with Doyle McBride, a NASA consultant who had never been employed by Kratos, to discuss starting a new company to perform government contract work. Several months later, MSRC was incorporated, with McBride and Teague each owning 50 percent. Thornton had no legal interest in MSRC at its formation. McBride acquired office space, issued stock, filed tax returns, obtained business licenses, registered to engage in government contracting, attended meetings, and talked with prime contractors on MSRC's behalf. In June 2011, Thornton's supervisor at Kratos learned that several employees under Teague's supervision had resigned in a short period. Following an investigation, Kratos terminated Teague's employment on June 23, 2011; Thornton resigned four days later. Teague and Thornton then went to work for MSRC. Thornton subsequently purchased MSRC from McBride and became its CEO and president. Subsequently Kratos filed a complaint against MSRC, Thornton, and Teague alleging specifically that Thornton and Teague, while employed by Kratos, assisted in the creation of MSRC, solicited Kratos employees, wrongfully diverted business opportunities, and misappropriated confidential and proprietary information. Kratos also alleged that MSRC wrongfully diverted business opportunities and misappropriated confidential and proprietary information. Kratos applied for a temporary restraining order ("TRO") and for a preliminary injunction on June 29, 2011. On appeal, MSRC, Thornton, and Teague argued that the preliminary injunction should be dissolved. MSRC, Thornton, and Teague raised several issues on appeal; however, because the Supreme Court concluded that the trial court's order was overbroad and that it failed to comply with Rule 65, Ala. R. Civ. P., the Court did not reach any of their other issues. View "Monte Sano Research Corp. v. Kratos Defense & Security Solutions, Inc." on Justia Law

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Monte Sano Research Corporation (MSRC), Steven L. Thornton, and Steven B. Teague appealed a preliminary injunction entered against them in an action brought by Kratos Defense & Security Solutions, Inc., a California-based aerospace and defense contractor, Digital Fusion, Inc. (DFI), an Alabama-based holding company, and Digital Fusion Solutions, Inc. (DFSI), a Florida corporation and a subsidiary of DFI (referred to collectively as Kratos), alleging breach of the duty of loyalty, breach of contract, tortious interference with business and contractual relationships, and civil conspiracy. Additionally, Kratos sought injunctive relief. MSRC was formed in 2009 to procure government subcontract work at Redstone Arsenal in Huntsville. Thornton and Teague were employees of DFI, which also engaged in government subcontract work; they became employees of Kratos when Kratos Defense merged with DFI in 2008. Kratos terminated Teagues employment on June 23, 2011. Thornton resigned from Kratos four days later. A dispute arose between the parties which implicated the employment contracts for Thornton and Teague when they sought subsequent work. Upon review of this case, the Supreme Court found that because the provisions of Rule 65(d)(2) of the Alabama Rules of Civil Procedure were not complied with and because there was no evidence of an irreparable injury or the lack of an adequate remedy at law, the trial court erred in issuing the preliminary injunction. The Court reversed the trial courts order entering the preliminary injunction and remanded the case to the trial court with directions that it dissolve the injunction it issued September 10, 2011. View "Monte Sano Research Corp. v. Kratos Defense & Security Solutions, Inc." on Justia Law