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SOUTHWEST MARINES, INC. v. UNITED STATES

November 28, 1995

SOUTHWEST MARINES, INC., a California corporation, Plaintiff,
v.
UNITED STATES OF AMERICA, in personam, Defendant. SOUTHWEST MARINE, INC., a California corporation, Plaintiff, vs. UNITED STATES OF AMERICA, Defendant.



The opinion of the court was delivered by: ORRICK

 These actions were brought by plaintiff Southwest Marine, Inc. ("Southwest") against defendant United States of America ("United States"), alleging breach of government procurement contracts. The United States moves to dismiss both lawsuits for lack of subject matter jurisdiction. For the reasons set forth herein, the United States' motions to dismiss are granted.

 I.

 In 1992, Southwest entered into four contracts with the United States for repairs and enhancements to two ships, the M.V. CAPE GIBSON and the M.V. CAPE GIRARDEAU. Both are public vessels under federal law. The contracting agency in each case was the Maritime Administration, part of the Department of Transportation, acting through its general agent and ship manager, American President Lines. The contracting officer was Ken Taylor.

 Southwest completed the work on both ships sometime in 1994. According to Southwest, the United States has failed to pay a total of approximately $ 12.6 million for work performed under the contracts. Southwest brought suit on April 21, 1995, seeking relief under the Contract Disputes Act of 1978 ("CDA"), 41 U.S.C. §§ 601 et seq., which provides remedies for disputes involving government procurement contracts.

 II.

 The United States claims that the Court lacks subject matter jurisdiction over Southwest's actions because Southwest failed to exhaust its administrative remedies under the CDA. The United States argues, and Southwest concedes, that Southwest did not submit a certified claim to the contracting officer in either case before filing these lawsuits. The United States contends that filing such claims is a prerequisite to bringing suit in federal district court under § 605 of the CDA.

 Southwest disputes this interpretation of the CDA. Essentially, it argues that (1) the CDA does not preempt the Court's traditional admiralty jurisdiction over maritime contract claims, and (2) even if the CDA is the exclusive remedy for a maritime contract claim involving a government procurement contract, such maritime contract claims are exempt from the requirement of bringing a claim to the contracting officer.

 A.

 The CDA provides an avenue for redress in disputes involving "any express or implied contract . . . entered into by an executive agency for . . . the procurement of services." 41 U.S.C. § 602(a)(2).

 "To proceed under the CDA, an aggrieved contractor must first present its claim to the agency Contracting Officer." Southwest Marine, Inc. v. United States, 43 F.3d 420, 423 (9th Cir. 1994); see 41 U.S.C. § 605(a). If the contracting officer denies the claim, then the contractor has two options: It can either (1) appeal to the governing agency board of contract appeals ("ABCA") pursuant to §§ 606 and 607(d), or (2) file suit in the Federal Court of Claims pursuant to § 609(a)(1). Southwest, 43 F.3d at 423. Decisions of the ABCA may be appealed to the Federal Circuit. See 41 U.S.C. § 607(g)(1)(A).

 The CDA provides an alternate procedure, however, for claims arising under maritime contracts, like those at issue here. *fn1" Section 603, the CDA provision for "Maritime contracts," gives jurisdiction over maritime contracts claims to the federal district courts pursuant to the Suits in Admiralty Act ("SAA"), 46 U.S.C. § 741 et seq., and the Public Vessels Act ("PVA"), 46 U.S.C. § 781 et seq. Congress chose to locate jurisdiction in the federal district courts because of the great expertise that the district courts have developed over the years on admiralty and maritime cases. S. Rep. No. 1118, 95th Cong., 2d Sess. 8, 18 (1978), reprinted in 1978 U.S.C.C.A.N. 5235, 5242, 5252; see also Southwest, 43 F.3d at 424.

 The United States argues that § 603 does not change the CDA's basic scheme; it merely places jurisdiction for CDA claims arising out of maritime contracts in the federal district courts. Therefore, § 603 does not exempt a contractor bringing a CDA claim arising out a maritime contract from ...


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