Cable & Computer Technology Inc. v. Lockheed Sanders, Inc.

214 F.3d 1030, 2000 Cal. Daily Op. Serv. 4191, 2000 Daily Journal DAR 5648, 2000 U.S. App. LEXIS 11949, 2000 WL 694175
CourtCourt of Appeals for the Ninth Circuit
DecidedMay 31, 2000
DocketNo. 99-55004
StatusPublished
Cited by9 cases

This text of 214 F.3d 1030 (Cable & Computer Technology Inc. v. Lockheed Sanders, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Ninth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Cable & Computer Technology Inc. v. Lockheed Sanders, Inc., 214 F.3d 1030, 2000 Cal. Daily Op. Serv. 4191, 2000 Daily Journal DAR 5648, 2000 U.S. App. LEXIS 11949, 2000 WL 694175 (9th Cir. 2000).

Opinions

Opinion by Judge NOONAN; Dissent by Judge CANBY.

NOONAN, Circuit Judge:

Cable & Computer Technology, Inc. (CCT) appeals the judgment of the district court in its action for breach of contract and related wrongs against Lockheed Sanders, Inc. (Sanders) and other Lockheed entities (collectively Lockheed or the defendants). We affirm the grant of summary judgment against CCT on its Unfair Business Practice and Cartwright Act claims. On CCT’s other appealed claims, we hold that material issues of fact were in dispute, reverse the district court and remand for trial. In some respects a garden variety contracts dispute, this case is set particularly in the world of defense contracting and draws a clear distinction between mere agreements to agree and agreements to team together to bid a subcontract, so that we think it may be helpful to publish our opinion.

BACKGROUND

In 1996 Boeing Defense and Space Group (Boeing) was awarded a contract by the United States Air Force to upgrade [1033]*1033the computer system for the B-1B bomber. Boeing needed subcontractors to .perform the contract and in May 1996 issued a Request for Information or RFI to, among others, CCT. CCT is a 30-employee California corporation that designs, manufactures, integrates and tests equipment and systems intended to replace existing commercial and military computers. The purpose of the RFI was to alert CCT to Boeing’s needs and to “prequalify” CCT as a bidder for a subcontract from Boeing. CCT had to respond to the RFI in June 1996 and to file its actual bid by November 11,1996.

CCT had teamed with Sanders in 1993 in the upgrading of the computer system of the B-52 bomber and in 1994 to produce Futurebus Processor modules for the Lockheed F-22 Simulator. After receiving the RFI, CCT contacted Sanders, a division of Lockheed, to work with it on a bid on the Boeing project. What then happened is disputed. The parties’ differing accounts will be set out below. Suffice it to say here that on October 30, 1996 Sanders withdrew, and, as a consequence, CCT was unable to make a bid for the Boeing subcontract. Boeing ultimately awarded this subcontract to Owego, a wholly owned subsidiary of Lockheed.

PROCEEDINGS

On June 19, 1997, CCT filed this action in Orange County Superior Court. Lockheed removed it'to the district court on the grounds of diversity. On March 23, 1998, Lockheed moved for summary judgment on CCT’s first claim, which alleged breach of contract. The motion was granted on April 13, 1998. Thereafter, at later times whose dates will be noted as relevant, the district court entered summary judgment against CCT on each of its causes of action.

CCT timely appealed to this court.

analysis'

We will address the propriety of each of the summary judgments in turn, asking the standard questions whether there were material facts in dispute and whether the plaintiff offered some “significant probative evidence tending to support the complaint.” Summers v. A. Teichert & Son, Inc. 127 F.3d 1150, 1152 (9th Cir.1997). We may not, any more than the district court might not, weigh the evidence or determine the truth of the matter. We view the evidence in the light most favorable to the nonmoving party and take account of all inferences in its favor that may be drawn from the facts. In this diversity action we apply the substantive law of California.

Breach of Contract. Sanders says that no contract existed, that all the parties did was to try, unsuccessfully, to work out a “teaming agreement,” which Boeing required to be submitted as part of the bid in writing if the bidder was to work with its own subcontractor. CCT says that it had a teaming agreement with Sanders in May 1996. The principal evidence offered by Lockheed is as follows:

1. In the deposition testimony of Michael Starzyk, the project manager for CCT, he repeatedly admitted that he expected there would be a signed, written teaming agreement.

2. Starzyk admitted that a written teaming agreement was required by Boeing to be submitted as part of the bid to Boeing.

3. In Sanders’ Management- Directive and Practice 10.10, effective October 25, 1996,. various officers’ approval of “a written Teaming Agreement” is required.

4. The three previous teaming agreements between CCT and Sanders on other projects were in writing.

5. The Boeing subcontract was worth about $20 million. The division of work between CCT and Sanders on such a large contract required negotiation before a contract could be reached.

6. Starzyk presented the first written draft of the teaming agreement in September 1996. The parties then negotiated 14 [1034]*1034separate terms not addressed before that date.

7. CCT in its complaint admitted that as late as October 24, 1996 the parties had not “finalized” the teaming agreement.

8. The written drafts of the teaming agreement did not state that it was a memorial of an oral contract. The drafts declared that the agreement was “effective upon the date of its execution.”

9. The drafts state that the agreement “contains the entire agreement of the parties and cancels and supersedes any previous understanding or agreement related to this Program, whether written or oral.”

10. No agreement was ever reached on what CCT would pay Sanders for its computers and services.

11. No written agreement was ever executed.

CCT did not dispute these facts. It offered other facts to show that a contract existed between it and Sanders:

1. The August 7, 1997 deposition of Clark Hollingsworth, president of CCT, stated that in May 1996 he discussed the teaming of CCT and Sanders with Ehtis-ham Siddiqui, a vice-president of Sanders, and that at the conclusion of the discussion, Siddiqui said, “We’ve got a deal.”

2. In his January 7, 1998 deposition, Michael Starzyk stated that CCT and Sanders had an oral agreement “in place” in May 1996 “to go acquire and win the Bl-B business.”

3. In his August 1996 deposition, George Woodruff, Manager of Business Development or the marketing man for Sanders, stated that CCT and Sanders responded in writing in June 1996 to Boeing’s RFI: “CCT is teamed with Sanders, a Lockheed Martin company, and we are both dedicated to obtaining the B-1B computer upgrade award”; that to the best of Woodruffs knowledge this statement was true; and that from June to October 1996, CCT and Sanders “acted like teammates” and made statements to each other and to others “that they were teammates.”

4.CCT, joined by Sanders personnel, hosted Boeing’s inspection of CCT’s facilities in June 1996 as a prelude to submitting the bid to Boeing.

Sanders does not dispute these facts.

In sum, the district court had before it, when it granted Sanders’ first summary judgment motion in April 1998, facts that were largely undisputed but might be argued in different ways. It was undisputed that the teaming agreement required by Boeing for the bid had to be in writing; both parties expected to have a written agreement, effective on execution; and no such written agreement was in existence.

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214 F.3d 1030, 2000 Cal. Daily Op. Serv. 4191, 2000 Daily Journal DAR 5648, 2000 U.S. App. LEXIS 11949, 2000 WL 694175, Counsel Stack Legal Research, https://law.counselstack.com/opinion/cable-computer-technology-inc-v-lockheed-sanders-inc-ca9-2000.