Northrop Grumman Technical Services, Inc. v. DynCorp International LLC
2017 U.S. App. LEXIS 13717
| 4th Cir. | 2017Background
- Northrop Grumman (prime contractor) subcontracted DynCorp in 2007 to supply personnel under a DOD prime contract; subcontract incorporated DOD "labor categories."
- Dispute arose over DynCorp’s labor "mapping" and billing; Northrop sought documentation and stopped submitting invoices when DynCorp refused, then sued in Virginia state court in March 2015 to compel production and for breach.
- DynCorp filed counterclaims in Sept 2015 (amended Nov 2015) seeking >$40M for unpaid invoices; Northrop answered in Dec 2015 and pleaded 21 defenses including lack of ripeness.
- While extensive state-court litigation proceeded (demurrer, discovery, motions, request for jury trial), Northrop filed an administrative Contract Disputes Act (CDA) claim with the Army on April 22, 2016; Northrop removed the case to federal court on May 12, 2016 under 28 U.S.C. § 1442, asserting a federal ripeness defense.
- The district court remanded, holding removal untimely and waived by Northrop’s litigation conduct; the Fourth Circuit affirmed, finding the 30-day removal clock was triggered earlier (by receipt of the amended counterclaims) and that Northrop’s prolonged state-court defense showed waiver.
Issues
| Issue | Northrop Grumman's Argument | DynCorp's Argument | Held |
|---|---|---|---|
| Whether Northrop’s May 2016 removal was timely under 28 U.S.C. § 1446(b) | Removal was timely because the federal ripeness defense only became available after Northrop filed the CDA claim (Apr 22, 2016) and received government acknowledgement | The 30-day clock began when DynCorp’s counterclaims (or amended counterclaims) put Northrop on notice that the CDA process could resolve the dispute | Held: Untimely — receipt of the amended counterclaims (Nov 2015) triggered the 30-day period; removal filed six months later was late. |
| Whether Northrop waived removal by litigating in state court | Northrop argued it did not waive because it filed removal as soon as its federal defense crystallized and was pursuing the CDA administrative remedy | DynCorp argued Northrop’s months of defensive litigation (demurrer, discovery, motions, jury demand) showed clear intent to remain in state court and thus constituted waiver | Held: Waived — Northrop’s extensive state-court participation constituted a clear and unequivocal intent to remain in state court, supporting waiver. |
| Whether a party’s own submission (the CDA claim) or the government’s acknowledgement can be the "other paper" that starts § 1446(b)(3)’s 30-day clock | Northrop argued the government’s acknowledgement of its CDA claim was an "other paper" triggering the 30‑day period | DynCorp argued that a defendant’s own filing and the government’s response cannot be the initiating "other paper" because the removal clock must be tied to receipt of notice of removability from opposing pleadings or other external papers | Held: The government’s acknowledgement of Northrop’s CDA claim is not the kind of "other paper" that starts the § 1446(b)(3) clock; a defendant cannot control the trigger by filing its own administrative claim. |
| Whether the availability of the CDA process made DynCorp’s counterclaims nonremovable until the CDA was filed | Northrop claimed the pending CDA made counterclaims unripe and thus permitted federal removal once that administrative process existed | DynCorp and the court noted the subcontract already made the CDA process available and that the availability was ascertainable when the counterclaims were filed | Held: The CDA’s availability was ascertainable earlier (by the time of the amended counterclaims); removal could not be postponed until Northrop chose to file the CDA. |
Key Cases Cited
- Ripley v. Foster Wheeler LLC, 841 F.3d 207 (4th Cir.) (standards for federal-officer removal and review)
- Grubb v. Donegal Mut. Ins. Co., 935 F.2d 57 (4th Cir. 1991) (waiver of removal by clear and unequivocal intent to remain in state court)
- Aqualon Co. v. Mac Equip., Inc., 149 F.3d 262 (4th Cir. 1998) (substantial defensive action can indicate waiver)
- Lovern v. Gen. Motors Corp., 121 F.3d 160 (4th Cir. 1997) (30-day removal period purpose and limits on strategic delay)
- Yarnevic v. Brink’s, Inc., 102 F.3d 753 (4th Cir. 1996) ("motion, order or other paper" interpreted broadly)
- Grupo Dataflux v. Atlas Global Grp., L.P., 541 U.S. 567 (U.S. 2004) (procedural context cited regarding prior case law)
- Rothner v. City of Chicago, 879 F.2d 1402 (7th Cir. 1989) (waiver analyzed in extreme situations)
- Bosky v. Kroger Tex., LP, 288 F.3d 208 (5th Cir. 2002) (discussed protective removals and equivocal records)
- Estate of Krasnow v. Texaco, Inc., 773 F. Supp. 806 (E.D. Va. 1991) (defendant cannot "test the waters" in state court then remove)