Freedom NY, Inc. v. United States

438 F. Supp. 2d 457, 65 Fed. R. Serv. 3d 1042, 2006 U.S. Dist. LEXIS 48291
CourtDistrict Court, S.D. New York
DecidedJuly 18, 2006
Docket86 Civ. 1363(MBM)
StatusPublished
Cited by29 cases

This text of 438 F. Supp. 2d 457 (Freedom NY, Inc. v. United States) is published on Counsel Stack Legal Research, covering District Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Freedom NY, Inc. v. United States, 438 F. Supp. 2d 457, 65 Fed. R. Serv. 3d 1042, 2006 U.S. Dist. LEXIS 48291 (S.D.N.Y. 2006).

Opinion

OPINION AND ORDER

MUKASEY, District Judge.

In 1986, plaintiff Freedom, N.Y., Inc. (“Freedom”), a government contractor that assembled combat rations known as “Meals, Ready to Eat” (“MREs”), sued defendant the United States of America (“the Government”), alleging that the Government violated procurement laws and regulations when it awarded a contract for the assembly of MREs to Cinpac, Inc. (“Cinpac”) instead of to Freedom. Then-Chief Judge Motley dismissed Freedom’s action without prejudice for failing to join Cinpac, a necessary and indispensable party under Fed.R.Civ.P. 19. Now, 20 years later, Freedom moves to correct or, in the alternative, to vacate judgment pursuant to Fed.R.Civ.P. 60(b)(6). As explained below, Freedom’s motion is futile because no fact advanced by Freedom would change the result reached by Judge Motley. The motion is also, and by far, untimely. Therefore, Freedom’s motion in denied.

I.

In 1985, the Defense Logistics Agency (“DLA”), an agency within the Department of Defense responsible for providing logistical support to the military, solicited bids for a contract to assemble MREs. (Am.CompLW 5-8) This contract was known as the “MRE-6 contract,” indicating that there had been five previous procurements (Def. Opp’n Mem. 4); the MRE-6 contract was awarded to Cinpac. (Am.Compl^ 18) Freedom protested that result administratively before filing a complaint for injunctive and declaratory relief in this court on February 14, 1986, and an amended complaint on April 25, 1986. (PI. Am. Mem. 3; Ex. A to Morrison Decl.) Freedom also filed a motion for a preliminary injunction at the same time as the original complaint. (Ex. C to Morrison Decl.)

Freedom’s amended complaint alleged that Cinpac was ineligible for the MRE-6 award because it failed to meet various legal requirements, and that the Government colluded with Cinpac to conceal this fact, falsifying multiple documents that supported and certified eligibility. (Am. CompLIffl 19-38) One of the reasons alleged for Cinpac’s ineligibility was that it did not qualify as a “manufacturer” as required by the Walsh-Healey Public Contracts Act, 41 U.S.C. § 35 et seq., and corresponding regulations. (Am. Compile 29-34) The Government, alleged Freedom, “collaborated in a scheme involving a sham lease to create the appearance that Cinpac exercised exclusive and unrestricted control over the plant, facilities and equipment owned and operated by Star Foods in San Antonio, Texas.” (Id. ¶ 32) Freedom sought a judgment that the Government’s contract with Cinpac was *460 unlawful, and demanded that the Government be barred from paying Cinpac, as well as from taking any action to deprive Freedom of the opportunity to receive contracts. (Id. Wherefore Clause)

The Government filed a motion to dismiss under Fed.R.Civ.P. 19, arguing that Cinpac was a necessary and indispensable party. By order dated May 9, 1986, the Court granted the Government’s motion and dismissed Freedom’s amended complaint without prejudice, issuing a full opinion in support of the order on May, 27, 1986. Freedom, N.Y., Inc. v. United States, No. 86 Civ. 1363(CBM), 1986 WL 6163, (S.D.N.Y. May 27, 1986). It is from this order and opinion that Freedom now seeks relief.

The opinion explained that Cinpac was a necessary party under Fed.R.Civ.P. 19(a) because its absence would “impair or impede its ability to protect its own interests” for at least two reasons. Id. at *1. First, the Government might prove a less than “vigorous ally” if presented with evidence than Cinpac had lied in its eligibility statement. Id. Second, “[t]he crucial facts in [the] law suit pertain[ed] to Cinpac, itself, that is, to Cinpac’s manufacturing capacity ... and to its conduct in representing itself to the government as a qualified bidder.” Id. at *2. Cinpac was also necessary because the Government could face inconsistent obligations if the Court enjoined performance of the contract but the Government was still liable under the contract for Cinpac’s costs and certain profits. Id. The Court could not order that Cinpac be joined because of its lack of contacts with New York, and therefore had to consider whether Cinpac was indispensable under Rule 19(b). Id. The Court found that all four factors enumerated in that Rule supported indispensability: (1) Cinpac risked significant prejudice both because the Government could “not be counted upon to represent Cinpac’s interests to the end” and because “the determinative factual” issue in this case — whether Cinpac was a qualified bidder — hinge[d] on Cinpac’s own industrial capacity and the truthfulness of its application, evidence which Cinpac, itself, [was] in the best position to develop; (2) it was impossible to shape judgment to avoid prejudice to Cin-pac because of the relief sought by Freedom; (3) a judgment for Freedom rendered in Cinpac’s absence would not be “adequate” because Cinpac could sue the Government for vindication of its perceived contractual rights; and (4) Freedom possessed an adequate alternative remedy in the event of dismissal, in that it could recommence suit against the Government and Cinpac in either Ohio or Pennsylvania. Id. at *3.

Among the evidence before the Court was an affidavit by Frank Bankoff, a Contracting Officer with the Defense Personnel Support Center (“DPSC”), a component of the DLA. 1 (Ex. 1 to PI. Am. Mem.) Bankoff was “DPSC Procuring Contracting Officer” for MRE-6 contract. (Id. ¶ 1) In the affidavit, dated March 14, 1986, Bankoff asserted that Cinpac was properly *461 qualified as a “manufacturer” under Walsh-Healey. (Id. ¶¶ 18-20) Freedom claims that “Bankoffs statements ... were deliberate lies intended to induce [the] Court into helping him hurt Freedom,” but that it “did not have sufficient evidence to demonstrate that Bankoff flatly was lying.” (Pl.Am.Mem.4)

Freedom did not appeal or seek reconsideration of the May 27, 1986, opinion; nor did it file suit in Ohio or Pennsylvania as suggested by the Court. Freedom claims that, following dismissal of its case, Bankoff “proceeded unlawfully to push Freedom out the MRE program” by ensuring that Freedom’s bid for a subsequent MRE contract (“MRE-7”) failed and by wrongfully terminating for default an existing MRE contract (“MRE-5”) between Freedom and the Government. (Id. at 4) Freedom claims that these actions drove it from the MRE program and destroyed it as an active business, causing hundreds of layoffs, lasting reputational damage, and vast financial harm. (Id.; Id. at 15-18)

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438 F. Supp. 2d 457, 65 Fed. R. Serv. 3d 1042, 2006 U.S. Dist. LEXIS 48291, Counsel Stack Legal Research, https://law.counselstack.com/opinion/freedom-ny-inc-v-united-states-nysd-2006.