215 Ct. Cl. 710 | Ct. Cl. | 1978
The plaintiff, an officer in the United
States Air Force, received an award under 10 U.S.C. § 1124 for a meritorious suggestion, namely the use of periscopes
Defendant’s first point is that making any such award is discretionary, and therefore any claim for one, or an increase in one, fails to pass the analysis prescribed by the Supreme Court in United States v. Testan, 424 U.S. 392 (1976).
The statute, § 1124, supra, was intended to extend to servicemen, with limitations not here relevant, the eligibility to receive cash awards for valuable suggestions, made to and adopted by their agencies, that civilian Government employees had long enjoyed under the statute formerly codified as 5 U.S.C. § 2121 and ff., but now § 4503. See legislative history at 2 U.S. Code Congressional and Administrative News (1965) p. 3161 and ff. The older statute thus having been the model, decisions under it are relevant in construing the newer one. Claims under the old one have been before this court several times, and it has been generally assumed that the standard for judicial review is abuse of discretion. Shaller v. United States, 202 Ct. Cl. 571, cert. denied, 414 U.S. 1092 (1973); Serbin v. United States, 168 Ct. Cl. 934 (1964); and Martilla v. United States, 118 Ct. Cl. 177 (1950). Kempinski v. United States, 164 Ct. Cl. 451, cert. denied, 377 U.S. 981 (1964), can be read as a flat denial of jurisdiction, but there the employee’s suggestion was rejected, while here it was adopted and put in effect, a distinction of significance as we will show. In all these cases the court was not persuaded that discretion was abused, a fact which detracts from the authority the cases might otherwise have as to jurisdiction; indeed, in Martilla the court expressly passed over, at 118 Ct. Cl. 182, whether it could ever have jurisdiction of such a claim. Defendant’s instant motion severs the question of jurisdiction from the merits, and requires us to decide it before addressing the merits.
The Tucker Act recognizes contracts implied in fact, as fully as if they were express. Such contracts have had a major role in our jurisprudence from early days. Before enactment of the present 28 U.S.C. § 1498, the court rejected patent infringement claims in general as sounding in tort. Schillinger v. United States, 24 Ct. Cl. 278 (1889), aff’d, 155 U.S. 163 (1894). But it allowed suits on patent claims on an implied contract theory, if the inventor offered the invention to the Government, expecting it to be tried, and the Government used it, expecting to be called on to pay. Berdan Fire-Arms Mfg. Co. v. United States, 25 Ct. Cl. 355 (1890), 26 Ct. Cl. 48 (1890), aff’d, 156 U.S. 552 (1895). More recently, this court has applied similar implied contract reasoning where a claimant had submitted an unpatented design in confidence, and' defendant circulated it to all its other competing vendors. Padbloc Co. v. United States, 161 Ct. Cl. 369 (1963). A claim not unlike Padbloc’s was made in Grismac, supra, but foundered because the alleged intellectual property there was considered a mere outsider’s suggestion, which defendant’s officials had not been given authority to use appropriated funds to buy. Padbloc was distinguished by pointing to 10 U.S.C. § 2386, which plainly authorized purchase of the designs Padbloc had submitted. It was also pointed out that under 5 U.S.C. § 4503, suggestions by defendant’s employees fared the same as designs.
Here, following enactment of the statute, which in effect authorized purchase of suggestions from service members,
We can put aside a case, as in Kempinski, supra, where the suggestion was rejected. Here it was accepted and acted on. We think clearly, under authority of Berdan and Padbloc, at the end of step 3, the Secretary had become bound by an implied contract. Its terms, at a minimum, required him to establish plaintiffs compensation without abuse of discretion and within the guidelines he had published, if there be any difference between these two concepts.
Besides the Berdan and Padbloc cases, the situation also offers some parallels to the implied contract rights we have imputed to one who has submitted an unsuccessful bid in response to a Government advertisement for bids. Heyer Products Co. v. United States, 135 Ct. Cl. 63, 140 F.Supp. 409 (1956); Keco Industries, Inc. v. United States, 192 Ct. Cl. 773, 428 F.2d 1233 (1970) and their progeny. We think plaintiffs case is stronger because he is plainly the intended beneficiary of 10 U.S.C. § 1124 while that is not so certain as to the unsuccessful bidder.
Thus, we think that the Secretary may have originally had uncontrolled and unreviewable discretion in the premises, but as he published procedures and guidelines, as he received responsive suggestions, as he implemented them and through his subordinates passed upon compensation claims, we think by his choices he surrendered some of his discretion, and the legal possibility of abuse of discretion came into the picture. Defendant seems to concede the rightness of this analysis at page 4 of its reply brief when it says: "However, once the Secretary decides in his discretion to make an award, the appropriate regula
Some further issues may be disposed of more quickly. Defendant says plaintiff, having accepted $8,905, is barred from claiming more by § 1124(d)(1) of the statute, which provides that the acceptance of an award shall constitute
(1) an agreement by the member that the use by the United States of any idea, method, or device for which the award is made may not be the basis of a claim against the United States by the member, his heirs, or assigns * * *.
Plaintiff argues that this means claims for compensation other than by incentive award. The legislative history seems to support this view as it gives, to illustrate what is meant, the case of an employee patenting his invention and claiming royalties under the patent. 2 U.S. Code Congressional and Administrative News (1965), supra, at 3164. Moreover, defendant has not in administration of the Act taken the position it does here. Thus plaintiff did not get his $8,905 all at once, but in driblets, and acceptance of one driblet was not taken as barring payment of the next one. If Congress had meant that acceptance of any incentive payment should bar any claim for additional incentive award, it could have said so. Should the Secretary desire, he could no doubt change the procedures so that a paid claimant would know and agree that this would occur. The Secretary could learn from any insurance company, or anyone else in the business of settling claims, how to do it. Instead, we see him actually suggesting in AFM-900-4, par. 5-3a(3), that an initial cash award not to exceed $50 be paid when delays are foreseen in determining the full value of an adopted contribution, but it is reasonably certain it will be over $500. We may be sure he does not intend this as a trap for claimants.
For tangible benefits, awards are payable on a sliding scale and for those over $100,000, the scale allows only $5
Accordingly, defendant’s motion for summary judgment is denied and the cause is remanded to the Trial Division for further proceedings.
The statute, 10 U.S.C. § 1124(f), places a $25,000 limit on an incentive award, and plaintiffs further recovery, if any, would be limited by that ceiling.
