Carter v. United States
98 Fed. Cl. 632
Fed. Cl.2011Background
- Drought (2002–04) prompted USDA to implement a drought-relief program providing nonfat dry milk (NDM) to states for livestock feed.
- CCC administered the program; states entered into sales agreements to receive NDM at $1 per 21-ton truckload with transport costs covered by the government.
- R & J Feed (Carter and Goodwin as Wyoming/Utah dealers) entered into state agreements via Utah to distribute NDM to producers.
- R & J alleged a contractual right to NDM and claimed the U.S. breached the agreement; the complaint was amended seeking over $21 million.
- Court granted in part the government’s motion to dismiss (12(b)(1)/(6)); dismissal affected four contract-based counts; count 5 on estoppel remained contentious and was dismissed for lack of jurisdiction.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Privity required to sue the U.S. on a contract claim | R&J contends implied/third-party rights exist | No direct contract between U.S. and R&J; privity missing | Lacks jurisdiction; no privity with U.S. |
| Implied-in-fact contract viability | There was mutuality/consideration through state contracts | No mutual agreement between R&J and U.S.; no consideration | Implied-in-fact contract not established; dismissal appropriate |
| Third-party beneficiary status viability | R&J could be an intended third-party beneficiary | Record insufficient to show direct intent to benefit R&J | Not conclusively established; potential but unresolved for count 2 |
| Equitable/promissory estoppel jurisdiction | Count 5 asserts reliance-based relief against the Government | Estoppel claims are not cognizable; promissory estoppel not jurisdictionally available | Promissory estoppel dismissed for lack of jurisdiction; estoppel claims barred |
Key Cases Cited
- Flexfab, L.L.C. v. United States, 424 F.3d 1254 (Fed. Cir. 2005) (standing and privity questions; government waivers of sovereign immunity rendered through privity)
- Anderson v. United States, 344 F.3d 1343 (Fed. Cir. 2003) (privity prerequisite for contract claims against the government)
- Cienega Gardens v. United States, 194 F.3d 1231 (Fed. Cir. 1999) (privity requirement and waiver of sovereign immunity)