Seh Ahn Lee v. United States
127 Fed. Cl. 734
| Fed. Cl. | 2016Background
- Plaintiffs (four long‑term contractors at the Broadcasting Board of Governors/V.O.A.) allege they performed personal services that should have been classified as personal‑service contracts or filled by civil‑service appointments; they seek Back Pay Act relief and damages for breach of an implied contract (class alleged ~660 similarly situated workers).
- A 2013 State OIG audit found many Board service contracts labeled "nonpersonal" appeared to meet the FAR §37.104(d) factors for personal‑service contracts; OIG estimated ~660 possibly personal in nature and recommended reclassification and process changes.
- Plaintiffs claim they were deprived of pay, benefits, and tax treatment they'd have received as appointees or as properly classified personal‑service contractors; they allege agency mislabeling and conduct amounting to fraud or misrepresentation.
- The Government moved to dismiss under RCFC 12(b)(1) and 12(b)(6): (1) Back Pay Act claim fails because plaintiffs were not "employees" appointed to the civil service; (2) breach‑of‑implied‑contract claim lacks jurisdiction under the Contract Disputes Act (CDA) and fails on the merits because an express contract precludes an implied contract on the same subject.
- The Court granted the Government’s motion: dismissed Count One (Back Pay Act) for lack of jurisdiction because plaintiffs concede they were not civil‑service appointees; dismissed Count Two because plaintiffs failed to state a non‑frivolous implied‑contract claim separate from their express contracts and quantum meruit/contract‑in‑law claims are outside the court’s jurisdiction or inapplicable.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| 1. Are plaintiffs entitled to Back Pay Act relief as "employees"? | Plaintiffs say they performed personal services like federal employees and agency mislabeling/fraud should not bar relief. | Gov't: Back Pay Act applies only to individuals appointed in the civil service; plaintiffs concede they were not appointed. | Dismissed for lack of jurisdiction — plaintiffs are not civil‑service appointees; Testan/Todd bar relief absent appointment. |
| 2. Does alleged agency fraud convert contractors into appointees for Back Pay Act purposes? | Fraud/misrepresentation by the Board induced contractors to serve without appointment; courts should allow Back Pay Act recovery in such cases. | Gov't: No authority supports converting contractual status into appointment via fraud; doctrine requires appointment for present money claims. | Rejected — plaintiffs cited no law transforming contractors into appointees based on fraud; jurisdictional bar remains. |
| 3. Is plaintiffs’ breach of implied contract claim barred by the CDA or otherwise outside jurisdiction? | Plaintiffs invoke implied‑in‑fact contract and quantum meruit, asserting agency obligations to pay employee‑style compensation; argue CDA inapplicable given circumstances. | Gov't: CDA requires presentment to contracting officer; quantum meruit/implied‑in‑law claims are generally outside the Court of Federal Claims. | Dismissed — court finds no non‑frivolous implied contract distinct from express contracts; CDA submission not determinative but jurisdictional defects and Amdahl/Institut Pasteur principles bar relief. |
| 4. Could court supply omitted terms or allow quantum meruit for unpaid employee‑style compensation? | Plaintiffs ask court to imply terms (rates/benefits) or award quantum meruit for services rendered. | Gov't: Express contracts cover the subject; omissions are not plausibly shown and quantum meruit exception requires contract rescission/invalidity or payment failure. | Rejected — plaintiffs did not allege essential omitted terms or invalid/rescinded contracts; quantum meruit not available here. |
Key Cases Cited
- Testan v. United States, 424 U.S. 392 (appointment prerequisite to monetary relief under civil‑service statutes)
- Todd v. United States, 386 F.3d 1091 (Fed. Cir. 2004) (Court of Federal Claims jurisdiction under Back Pay Act requires an entitlement to presently due money tied to appointment)
- Fisher v. United States, 402 F.3d 1167 (Fed. Cir. 2005) (Tucker Act requires a money‑mandating source separate from jurisdictional grant)
- Atlas Corp. v. United States, 895 F.2d 745 (Fed. Cir. 1990) (express contract precludes implied contract on same subject)
- Amdahl Corp. v. United States, 786 F.2d 387 (Fed. Cir. 1986) (quantum meruit recovery narrow exception where an express contract was rescinded/invalid)
- International Data Prods. Corp. v. United States, 492 F.3d 1317 (Fed. Cir. 2007) (Court lacks jurisdiction over implied‑in‑law/quantum meruit claims absent Amdahl‑type exception)