UNITED AERONAUTICAL CORP., ET AL V. USAF, ET AL, No. 21-56377 (9th Cir. 2023)
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United Aeronautical Corporation and Blue Aerospace, LLC (collectively, Aero) filed suit against the United States Air Force and Air National Guard (collectively, USAF) in the U.S. District Court for the Central District of California. Aero alleges that USAF has for some time violated federal procurement regulations and the Trade Secrets Act by improperly using Aero’s intellectual property. The district court dismissed for lack of subject matter jurisdiction, concluding that the Contract Disputes Act (CDA), precludes jurisdiction over Aero’s action by vesting exclusive jurisdiction over federal-contractor disputes in the Court of Federal Claims.
The Ninth Circuit affirmed. The panel agreed with the district court that the Contract Disputes Act “impliedly forbids” jurisdiction over Aero’s claims by vesting exclusive jurisdiction over federal-contractor disputes in the Court of Federal Claims. A claim falls within the scope of the CDA’s exclusive grant of jurisdiction if (1) the plaintiff’s action relates to (2) a procurement contract and (3) to which the plaintiff was a party. Here, Aero’s claims that USAF improperly received and used MAFFS data (1) relate to the DRA, (2) the DRA is a procurement contract, and (3) Aero is a contractor for purposes of the DRA. The panel held that the test set forth in Megapulse, Inc. v. Lewis, 672 F.2d 959 (D.C. Cir. 1982), is limited to determining whether the Tucker Act—which grants exclusive jurisdiction to the Court of Federal Claims over breach-of-contract actions for money damages—“impliedly forbids” an ADA action because Megapulse addressed implied preclusion only pursuant to the Tucker Act, not pursuant to the CDA.
Court Description: Contract Disputes Act / Jurisdiction. The panel affirmed the district court’s dismissal for lack of subject-matter jurisdiction of an Administrative Procedure Act (APA) action brought by United Aeronautical Corporation and Blue Aerospace, LLC (collectively, Aero) against the U.S. Air Force and U.S. Air National Guard (collectively, USAF) alleging that USAF improperly used Aero’s intellectual property—data relating to the Mobile Airborne Firefighting System (MAFFS)—in violation of federal procurement regulations and the Trade Secrets Act.
Aero delivered a hard drive containing MAFFS-related data to the United States Forest Service and executed a Data Rights Agreement (DRA) granting the Forest Service “unlimited rights to view and use” the data. The Forest Service delivered that hard drive to USAF, and Aero sued USAF for its receipt and use of the MAFFS data.
The APA waives sovereign immunity for actions in federal district court by persons suffering legal wrong because of agency action; however, when a statute vests exclusive jurisdiction over a category of claims in a specialized court, it “impliedly forbids” an APA action in district court.
The panel agreed with the district court that the Contract Disputes Act “impliedly forbids” jurisdiction over Aero’s claims by vesting exclusive jurisdiction over federal- contractor disputes in the Court of Federal Claims. A claim falls within the scope of the CDA’s exclusive grant of jurisdiction if (1) the plaintiff’s action relates to (2) a procurement contract (3) to which the plaintiff was a party. Here, Aero’s claims that USAF improperly received and used MAFFS data (1) relate to the DRA, (2) the DRA is a procurement contract, and (3) Aero is a contractor for purposes of the DRA.
The panel held that the test set forth in Megapulse, Inc. v. Lewis, 672 F.2d 959 (D.C. Cir. 1982), is limited to determining whether the Tucker Act—which grants exclusive jurisdiction to the Court of Federal Claims over breach-of contract actions for money damages—“impliedly forbids” an ADA action because Megapulse addressed implied preclusion only pursuant to the Tucker Act, not pursuant to the CDA.
Dissenting, Judge Collins would reverse the district court’s dismissal for lack of subject-matter jurisdiction, and hold that the CDA does not “impliedly forbid” Aero from bringing an APA action because Aero’s claims are not based on a government contract, but instead on Aero’s independent statutory rights under the Trade Secrets Act.
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