United States District Court, District of Columbia
G. SULLIVAN UNITED STATES DISTRICT JUDGE
Sebastian Phillips (“Mr. Phillips”), a Naval
Architect, and his architecture and engineering firm,
Plaintiff Marine Design Dynamics, Inc. (“MDD”),
allege that they have been effectively debarred from future
government contracts with the United States Department of the
Navy since 2011. Plaintiffs sued the Secretary of the Navy,
the Chief and Deputy Chief of Naval Operations, and four
officials of the Naval Sea Systems Command
(“NAVSEA”) and Operational Logistics Integration
Program (“OPLOG”) (collectively, the
“Federal Defendants”). Plaintiffs contend that
the Federal Defendants violated the Fifth Amendment to the
United States Constitution by blacklisting MDD from
government contracting without due process. The Federal
Defendants deny these allegations, listing several contracts
and government work awarded by the Navy to MDD as proof
against any alleged de facto debarment. Plaintiffs
do not dispute that MDD received more than $14 million in
contracts, purchase orders, delivery orders, and funding
modifications between 2011 and 2016. Rather, Plaintiffs argue
that they were de facto debarred from competing for
OPLOG work and Military Sealift Command (“MSC”)
work. Plaintiffs also assert common-law tort claims against
four former MDD employees and two Navy officials.
before the Court are the parties' motions: (1) the
Federal Defendants' Renewed Motion to Dismiss, or in the
alternative, for Summary Judgment as to Counts I, II, and IX;
(2) Plaintiffs' Motion for Partial Summary Judgment as to
Count I; (3) the parties' cross-motions for summary
judgment as to Counts VI and VIII against Defendant Matthew
Miller (“Mr. Miller”); and (4) Plaintiffs'
Motion for Entry of Order for Summary Judgment. Upon careful
consideration of the parties' submissions, the applicable
law, and the entire record, the Court concludes that: (1)
Plaintiffs have not met the high standard of proving de
facto debarment, and Defendants Charles Traugh
(“Mr. Traugh”) and Michael Bosworth (“Mr.
Bosworth”) are entitled to qualified immunity; (2)
Plaintiffs' tort claims against Defendant William
Robinson (“Mr. Robinson”) and Mr. Traugh fall
under the Federal Tort Claims Act; (3) Plaintiffs have not
met their burden of demonstrating that Mr. Robinson and Mr.
Traugh were acting outside the scope of their employment;
thus, the United States will be substituted as the defendant
as to the tort claims asserted against Mr. Traugh and Mr.
Robinson pursuant to the Westfall Act; (4) the United States
has not waived its sovereign immunity for the tort claims
against Mr. Robinson and Mr. Traugh; (5) the undisputed facts
demonstrate that Mr. Miller did not breach his fiduciary duty
owed to MDD; and (6) Plaintiffs' civil conspiracy claim
as to Defendant Miller fails as a matter of law. Accordingly,
the Court GRANTS the Federal Defendants'
Renewed Motion to Dismiss, or in the alternative, for Summary
Judgment as to Counts I, II, and IX, and
DENIES Plaintiffs' Motion for Partial
Summary Judgment as to Count I. The Court DENIES AS
MOOT Plaintiffs' Motion for Entry of Order for
Summary Judgment. Finally, the Court GRANTS
Defendant Miller's Motion for Summary Judgment as to
Counts VI and VIII, and DENIES
Plaintiffs' Motion for Summary Judgment as to Counts VI
Court assumes the parties' familiarity with the factual
background and the long history of this litigation, which are
set forth in the Court's two prior opinions. See
Phillips v. Mabus, 894 F.Supp.2d 71 (D.D.C. 2012)
(“Phillips I”); see also Phillips v.
Mabus, 319 F.R.D. 36 (D.D.C. 2016) (“Phillips
II”). The following facts-drawn from the
parties' submissions-are undisputed, except where
MDD's Work for the Navy
2005, Mr. Phillips, a Naval Architect, formed MDD. Am.
Compl., ECF No. 42 at 4 ¶ 6. MDD is a Naval architecture
and marine engineering firm based in the District of
Columbia. See, e.g., Phillips I, 894
F.Supp.2d at 77. Mr. Phillips serves as MDD's president
and chief executive officer. Fed. Defs.' Statement of
Material Facts Not in Genuine Dispute (“SOMF”),
ECF No. 88 at 3 ¶ 2. The firm specializes in ship energy
conservation, and it primarily serves as a government
contractor and subcontractor for the Navy and its components.
Phillips I, 894 F.Supp.2d at 77-78; see
also Def. Miller's Opp'n, ECF No. 133 at 1-2
(noting that MDD's website lists contracts valued at more
than $44 million). Relevant here is MDD's government
contracting work under a subcontract with Computer Sciences
Corporation (“CSC”) and a contract with the MSC.
MDD and CSC Subcontract
Between 2006 and 2011, MDD was one of the subcontractors for
CSC, see Am. Compl., ECF No. 42 at 6 ¶ 23, and
CSC was one of the contractors supporting the Navy's
OPLOG. Fed. Defs.' SOMF, ECF No. 88 at 4 ¶ 10. The
Navy, through its SeaPort-e program, awarded CSC a contract
to provide support services to NAVSEA. Decl. of Robert
C. Beaubien (“Beaubien Decl.”), ECF No. 88-1 at
2-3 ¶¶ 2-3. Under that contract, CSC and MDD
entered into “a firm-fixed price, indefinite-delivery,
indefinite quantity [sub]contract under which MDD provided
services only when it received a task order from CSC to do
so.” Id. at 3 ¶ 4. In turn, MDD
subcontracted AirClean Technologies, Inc.
(“AirClean”), a company based in Seattle,
Washington, to assist MDD with its work under the CSC-MDD
subcontract. Decl. of Sebastian Phillips (“Phillips
Decl.”), ECF No. 94-1 at 3 ¶¶ 13-15. The
period of performance for the CSC-MDD subcontract commenced
on June 18, 2009 and ended on April 4, 2014. Fed. Defs.'
Ex. B, ECF No. 88-2 at 12.
CSC's senior program manager, Robert C. Beaubien
(“Mr. Beaubien”) was CSC's contract monitor
for MDD, and his duties consisted of, inter alia,
managing its subcontractors' performance and payments
under CSC's contract with NAVSEA. Fed. Defs.' SOMF,
ECF No. 88 at 4 ¶ 11. The CSC-MDD subcontract provided
that “CSC [was] under no obligation to issue any Task
Orders” to MDD. Fed. Defs.' Ex. B, ECF No. 88-2 at
6. It also stated that “[t]he value for services to be
provided by [MDD] will be specified in each Task Order”
and that “in no way obligates CSC to award Task Orders
under this Agreement . . . .” Id. at 5.
on NAVSEA's instructions, CSC distributed the OPLOG work
to subcontractors like MDD. See Beaubien Decl., ECF
No. 88-1 at 3 ¶ 5. Mr. Beaubien oversaw MDD's
services to OPLOG. Fed. Defs.' SOMF, ECF No. 88 at 4
¶ 11. OPLOG's program manager, Mr. Traugh, contacted
Mr. Beaubien regarding the OPLOG work, and Mr. Traugh
provided “informal” guidance on how CSC should
distribute the OPLOG work. Beaubien Decl., ECF No. 88-1 at 3
¶ 5. In 2011, Mr. Traugh “directed all OPLOG
projects, including those which Plaintiffs were
subcontractors to, and coordinated directly with the
Navy.” Pls.' SOMF, ECF No. 107 at 5 ¶ 13. Mr.
Traugh and NAVSEA's chief technology officer, Mr.
Bosworth, had the authority to manage the programs concerning
OPLOG's relationship with Plaintiffs. See, e.g.,
id. at 5 ¶ 12; Fed. Defs.' Mot. to Dismiss,
ECF No. 88 at 40 n.25 (citing Phillips I, 894
F.Supp.2d at 86 n.5).
behalf of MDD, Mr. Phillips submitted a monthly package of
status reports and invoices to Mr. Beaubien, and Mr. Beaubien
sent MDD's package to OPLOG's program manager, Mr.
Traugh, for his approval. Fed. Defs.' SOMF, ECF No. 88 at
9 ¶ 33. Mr. Traugh and OPLOG's assistant program
manager, Mr. Robinson, managed OPLOG's funding, planned
the expenditures of those funds for various tasks, and
assigned certain tasks to MDD. Id. at 9 ¶¶
31-32. MDD's three employees-Defendants Michael Mazzocco
(“Mr. Mazzocco”), Volker Stammnitz (“Mr.
Stammnitz”), and William Muras (“Mr.
Muras”)-performed the OPLOG work, and they discussed
task assignments with Mr. Traugh and Mr. Robinson.
See Fed. Defs.' SOMF, ECF No. 88 at 9 ¶ 34.
to fiscal year 2012, after receiving an e-mail from Mr.
Phillips in April 2011 about the status of a “new
task” order for OPLOG work, Mr. Beaubien responded that
the task was under “[c]ompliance [r]eview.”
Id. at 5 ¶ 14. Mr. Beaubien also stated that
Mr. Traugh “wants me to reduce [MDD's] allocation
by $700[, 000]” in order “to fund these other new
start-ups.” E-mail from Mr. Beaubien, CSC, to Mr.
Phillips (Apr. 13, 2011), Pls.' Ex. G, ECF No. 42-1 at
58. In May 2011, CSC issued MDD a task order modification for
OPLOG work in the amount of $1, 707, 522, noting that it
reflected a “$700, 000 deobligation underway.”
Fed. Defs.' SOMF, ECF No. 88 at 5-6 ¶ 17. In June
2011, CSC issued MDD another task order modification for
OPLOG work in the amount of $1, 192, 522, which established
the final funding for fiscal year 2011. Id. at 6
¶ 18. CSC disbursed the remainder of the $700, 000
reallocation to its own employees and other subcontractors,
such as Gryphon Technologies and D&K Engineering.
Beaubien Decl., ECF No. 88-1 at 5 ¶ 7.
March 2011 to June 2011, MDD's three senior-level
employees who worked on OPLOG projects under the CSC-MDD
subcontract resigned from the firm. E.g., Pls.'
SOMF, ECF No. 107 at 6 ¶¶ 15-16, 7 ¶ 22;
Pls.' SOMF, ECF No. 113 at 5 ¶¶ 5, 7; Am.
Compl., ECF No. 42 at 5-6 ¶¶ 15-16, 6 ¶ 17. In
March 2011, Mr. Mazzocco, MDD's Vice President of
Operations, departed the firm to work as an independent
subcontractor, see Pls.' SOMF, ECF No. 107 at 6
¶ 16, and he eventually started his own company, Alytic,
Inc., that performed OPLOG work, Beaubien Decl., ECF No. 88-1
at 5 ¶ 7. Mr. Stammnitz left his position as MDD's
Vice President of Systems Engineering in June 2011, and Mr.
Muras left his position as MDD's Director of Energy
Programs, Financial Analysis and Planning in that same month.
See Am. Compl., ECF No. 42 at 5-6 ¶¶
16-17. In August 2011, CSC hired Mr. Stammnitz and Mr. Muras
to perform OPLOG work. Beaubien Decl., ECF No. 88-1 at 5
their departures and at some point in May 2011, “the
Navy arranged for a multi-day meeting in Boston[, ]”
Massachusetts “to discuss the OPLOG energy conservation
program . . . .” Def. Muras' Answer, ECF No. 80 at
9 ¶ 68. MDD's two employees-Mr. Stammnitz and Mr.
Muras-and MDD's former employee- Mr. Mazzocco-attended
the meeting with the Navy officials. An email states that Mr.
Bosworth of NAVSEA directed OPLOG's program manager, Mr.
Traugh, to end the contract with MDD. Mem. from Steven R.
Southard, NAVSEA (July 19, 2011), Pls.' Ex. D, ECF No.
42-1 at 48 (“Southard Memorandum”). That
directive was memorialized in a memorandum:
On 13 July 2011, during a review of the Operational Logistics
Program, in the presence of Mr. Greg Doerrer, Mr. William
Robinson, and me, Mr. Michael Bosworth directed Mr. Charles
Traugh to terminate the contract of [MDD] and not to resume
it in Fiscal Year 2012. This action is due to reasons
discussed at the meeting.
Id. Soon thereafter, litigation ensued.
the filing of this lawsuit, Plaintiffs and the Federal
Defendants agreed and stipulated to a consent preliminary
injunction, requiring, among other things, “the Navy to
allow MDD to compete for new work and to continue performing
contracts it was currently performing under the same
standards applicable to other contractors.”
Phillips I, 894 F.Supp.2d at 78. As a result, the
Navy appointed an OPLOG employee as a technical point of
contact between CSC and OPLOG so that MDD could receive OPLOG
work under the CSC-MDD subcontract. Id. at 78,
90-92. In December 2011, counsel for the Navy issued a
memorandum, stating that “the Court's [O]rder
require[s] all personnel of this Command to . . . neither
encourag[e] nor interfer[e] with: (1) the efforts of MDD to
obtain work from prime contractors; or (2) prime
contractors' decisions whether or not to subcontract with
MDD.” Mem. from Sophie A. Krasik, Counsel, U.S.
Dep't of the Navy (Dec. 16, 2011) (footnote omitted),
Pls.' Ex. K, ECF No. 54-3 at 18; see also Fed.
Defs.' SOMF, ECF No. 88 at 7 ¶ 24. At
Plaintiffs' request, the Navy eventually appointed Mr.
Doerrer, an OPLOG employee, as the technical point of contact
for any OPLOG work because Plaintiffs had not charged him
with any wrongdoing. Phillips I, 894 F.Supp.2d at
November 2009, MDD entered into a contract with the Navy as
the prime contractor for MSC's energy conservation
program.Pls.' SOMF, ECF No. 107 at 5 ¶ 11.
That contract provided for a one-year term with options to
renew through November 2012. Phillips I, 894
F.Supp.2d at 77; see also Fed. Defs.' Ex. G, ECF
No. 88-7 at 3. In October 2011, MSC ultimately exercised the
second and final option, extending the contract with MDD to
November 1, 2012. Fed. Defs.' Ex. G, ECF No. 88-7 at 2-3;
see also Fed. Defs.' SOMF, ECF No. 88 at 6
to that renewal, an MSC employee who worked with MDD
forwarded Mr. Phillips an e-mail from a NAVSEA employee.
See Email from Thomas Martin, NAVSEA, to René
Fry, MSC (Sept. 15, 2011), Pls.' Ex. R, ECF No. 42-1 at
79 (“Martin E-mail”). It states that “my
boss [Mr.] Bosworth has dictated that no funding be sent to
MDD in support of OPLOG in FY12. Apparently there was a
problem with tracking the money. The work itself was
fine.” Id. In October 2011, the same MSC
employee forwarded Mr. Phillips another e-mail from the same
NAVSEA employee, which states that “I have been
directed by my leadership to not be involved with any
contract that includes MDD. Therefore, I cannot be the
[technical point of contact].” E-mail from Thomas
Martin, NAVSEA, to René Fry, MSC (Oct. 7, 2011),
Pls.' Ex. S, ECF No. 42-1 at 80. Nonetheless, MSC issued
a contract modification to MDD on October 31, 2011. Fed.
Defs.' SOMF, ECF No. 88 at 6 ¶ 22.
2012 and 2014, MDD avers that it submitted seven bids for
competitive solicitations for contracts with the Navy and
MSC, and that MDD was awarded one of those contracts after it
filed a post-award protest. Pls.' SOMF, ECF No. 107 at 10
¶ 36. Following MDD's protest of MSC's refusal
to issue a solicitation as a “single-award,
small-business set-aside, ” id. at 9 ¶
32, the Government Accountability Office (“GAO”)
and the Small Business Administration (“SBA”)
concluded that MSC did not adequately perform market research
to determine if the solicitation should have been set aside
for small businesses, id. at 9 ¶ 33. In May
2013, the MSC Ombudsman Report concluded that MSC did not
give MDD a “fair opportunity to compete for this
government contract award . . . .” Id. at 10
¶ 35; see also Pls.' Ex. E, ECF No. 107-5
MDD's setbacks in government contracting with MSC, MSC
awarded MDD an indefinite-delivery, indefinite quality
contract with a maximum value of more than $2 million in
September 2012. Fed. Defs.' Reply, ECF No. 104-1 at 6. In
June 2013, MSC awarded MDD a task order under MDD's
SeaPort-e contract with NAVSEA. Id.; see
also Def. Miller's Opp'n, ECF No. 123 at 14.
Additionally, MDD received a task order from MSC on May 23,
2014, and MSC awarded MDD another task order on the same day.
Def. Miller's Opp'n, ECF No. 123 at 14-15.
MDD's Contracts from the Navy and Its Components
continued to receive work and funds from the Navy over the
course of this litigation. Beginning in 2011, the Navy and
its components awarded MDD new contracts, contract options,
modifications, task orders, and payments. See, e.g.,
Fed. Defs.' SOMF, ECF No. 88 at 5, 7 ¶¶ 16, 23,
25-26; Fed. Defs.' Reply, ECF No. 104-1 at 5-6. MDD also
received work from MSC and OPLOG's parent activity.
See Fed. Defs.' Opp'n, ECF No. 124 at 5-10
(listing work awarded to MDD from November 2013 to July
2016). On August 21, 2014, MDD was awarded a NAVSEA contract
in the amount of $14, 483, 912.86. Fed. Defs.' Notice to
the Court, ECF No. 118 at 1; see also Def.
Miller's Opp'n, ECF No. 123 at 14. On that same day,
MDD received work under a contract from the Naval Surface
Warfare Center, Carderock Division-OPLOG's parent
activity. Fed. Defs.' Opp'n, ECF No. 124 at 6-7.
MDD and Defendant Matthew Miller
February 2010, MDD hired Mr. Miller, and he performed OPLOG
and MSC work as a Marine Engineer until his resignation in
July 2011. See, e.g., Pls.' SOMF, ECF No. 113 at
5 ¶¶ 6-7; Decl. of Matthew Miller (“Miller
Decl.”), ECF No. 123-1 at 1 ¶¶ 1-2, 2 ¶
6; Am. Compl., ECF No. 42 at 6 ¶ 18. Most of Mr.
Miller's work at MDD consisted of providing engineering
and program management services to MSC's Energy
Conservation Program. Def. Miller's SOMF, ECF No. 87 at
15 ¶ 5. Mr. Miller devoted a small percentage of his
time to the CSC subcontract, providing services to OPLOG.
Id. at 15 ¶ 6. His work included creating
MDD's Statement of Work (“SOW”) for OPLOG
work. See Miller Decl., ECF No. 123-2 at 3 ¶
17; see also Pls.' SOMF, ECF No. 113 at 7-8
Miller was an “at-will” employee who never signed
MDD's employee handbook (the “MDD Employee
Handbook”). See Def. Miller's Mot. for
Summ. J., ECF No. 87 at 8; see also Miller Decl.,
ECF No. 98 at 4 ¶ 3. Mr. Miller admits that he signed
the “Terms and Conditions of Employment, ” which
contains a confidentiality provision. Def. Miller's
Reply, ECF No. 99 at 6; see also Pls.' Ex. 1,
ECF No. 113-1 at 2 (“[W]hile serving as a MDD employee,
we request that you not assist any person or organization in
competing with MDD, in preparing to compete against MDD or in
hiring any employees away from MDD.”).
his employment with MDD, Mr. Miller and Mr. Mazzocco, at some
point in 2010, created two versions of a PowerPoint
presentation for the formation of a new company.
E.g., Miller Decl., ECF No. 123-2 at 2 ¶ 6;
Pls.' SOMF, ECF No. 113 at 6 ¶¶ 12-13. The new
company aimed to provide energy conservation products to
prospective partners in the industry. Pls.' Ex. H, ECF
No. 94-8 at 21; see also Pls.' Ex. G, ECF No.
94-7 at 15. The first version was a business proposal for
“East Coast Energy Engineering, ” and the revised
version was a business proposal for “East Coast Energy
Management, Inc.” Compare Pls.' Ex. H, ECF
No. 94-8 at 1, with Pls.' Ex. G, ECF No. 94-7 at
1. Both versions listed the “Government” and
“Commercial” as bullet points for the new
company's “Long Term (1 Year)” goals.
Compare Pls.' Ex. H, ECF No. 94-8 at 6,
with Pls.' Ex. G, ECF No. 94-7 at 6.
the education and work experience of Mr. Miller and Mr.
Mazzocco, the revised version of the business proposal (the
“Proposed Business Plan”) states that the new
company will be “founded by two graduates from United
States Military and Merchant Marine Academies. [Mr. Miller
and Mr. Mazzocco] have over 20 years of engineering
experience and have been applying [their] skills to reducing
the U.S. Navy's fuel consumption.” Pls.' Ex. H,
ECF No. 94-8 at 21. The Proposed Business Plan estimates that
forty hours per week would be devoted to MDD, and a total of
fifty-six hours per week would be spent on the new company.
Id. at 11. The new company never operated as a
business enterprise or generated any revenue. Suppl. Decl. of
Matthew Miller (“Miller Suppl. Decl.”), ECF No.
100-1 at 1 ¶¶ 2-3.
Mr. Miller worked with Mr. Mazzocco, Mr. Stammnitz, and Mr.
Muras. While Mr. Mazzocco, Mr. Stammnitz, and Mr. Muras
attended the meeting in Boston in May 2011 with the Navy
officials, Mr. Miller did not attend that meeting because he
was working on an assignment for MDD. Miller Decl., ECF No.
123-2 at 2 ¶ 11. After resigning from MDD in July 2011,
Mr. Miller worked for AirClean for four months, and AirClean
solicited CSC to work as a subcontractor for Merrill-Dean
Consulting, Inc. (“Merrill-Dean”), based on
Merrill-Dean's pre-existing contract with CSC.
See Miller Decl., ECF No. 98 at 6 ¶¶
16-18; see also Pls.' SOMF, ECF No. 113 at 7
¶ 21. At some point, Mr. Miller drafted a SOW for
AirClean to provide services to CSC, relying on a version of
MDD's SOW for OPLOG work from the bidding process.
See, e.g., Pls.' SOMF, ECF No. 113 at 7
¶¶ 22-23; Miller Decl., ECF No. 123-2 at 3 ¶
17. As an AirClean employee, Mr. Miller did not perform any
work for MSC, Def. Miller's SOMF, ECF No. 87 at 16 ¶
19, and he left AirClean in December 2011, id. at 16
January 2012, CSC hired Mr. Miller, and he worked there
before joining MSC. Beaubien Decl., ECF No. 88-1 at 5 ¶
8. Mr. Miller worked as a Mechanical Engineer at CSC from
January 2012 until March 2012. Pls.' SOMF, ECF No. 113 at
8 ¶ 27. On March 12, 2012, he accepted a position at MSC
as a Mechanical Engineer. Miller Decl., ECF No. 123-2 at 3
¶ 20; see also Def. Miller's SOMF, ECF No.
87 at 17 ¶ 25.
November 16, 2011, Plaintiffs filed the present action
against seven Navy officials and four former MDD employees.
See generally Compl., ECF No. 1. Following a hearing
on Plaintiffs' emergency motions for a temporary
restraining order and preliminary injunction, the Court
granted the parties' Stipulated Preliminary Injunction on
December 7, 2011. Phillips I, 894 F.Supp.2d at 76;
Order, ECF No. 30 (Dec. 7, 2011). Under the terms of the
Stipulated Preliminary Injunction, the Federal Defendants
were enjoined from taking any actions to implement, enforce,
or spread to any federal agency the de facto
debarment of Plaintiffs from government contracting.
Phillips I, 894 F.Supp.2d at 88-89.
January 3, 2012, Plaintiffs filed the Amended Complaint,
asserting nine claims against the eleven defendants.
See Am. Compl., ECF No. 42 at 29-49 ¶¶
99-199. Count I asserts that the Federal Defendants violated
Plaintiffs' constitutional right to due process under the
Fifth Amendment by blacklisting them from government
contracting without procedural safeguards, and it seeks
declaratory and injunctive relief. Id. at 29-34
¶¶ 99-121. Count II asserts the same claims against
Mr. Traugh and Mr. Bosworth in their individual capacities
and it seeks damages of $2.5 million. Id. at 34-35
¶¶ 122-26. Counts III-VIII assert breach of
fiduciary duty and civil conspiracy claims against Mr.
Mazzocco, Mr. Stammnitz, Mr. Muras, and Mr. Miller, and a
common-law defamation claim against Mr. Mazzocco.
Id. at 35-46 ¶¶ 127-92. Count IX alleges
common-law interference with contractual relations by Mr.
Traugh and Mr. Robinson in their official and individual
capacities. Id. at 47-49 ¶¶ 193-200.
September 30, 2012, the Court denied the following motions:
(1) the Federal Defendants' motion to dismiss, or in the
alternative for summary judgment, (2) Plaintiffs' motion
to enforce the Stipulated Preliminary Injunction, and (3) the
motions to dismiss filed by Mr. Mazzocco, Mr. Stammnitz, and
Mr. Muras. Phillips I, 894 F.Supp.2d at 76. After
the parties engaged in settlement discussions and limited
discovery on the issues relevant to Counts II and IX, the
parties did not reach a resolution. Phillips II, 319
F.R.D. at 37.
the parties engaged in full rounds of briefing on the pending
motions: (1) Plaintiffs' motion for partial summary
judgment as to Count I, see generally Pls.' Mot.
for Partial Summ. J., ECF No. 107; (2) the Federal
Defendants' renewed motion to dismiss, or in the
alternative, for summary judgment as to Counts I, II, and IX,
see generally Fed. Defs.' Renewed Mot. to
Dismiss or, in the Alt. for Summ. J. (“Fed. Defs.'
Mot. to Dismiss”), ECF No. 88; and (3) Plaintiffs'
Motion for Entry of Order for Summary Judgment, see
generally Pls.' Mot. for Entry of Order for Summ.
J., ECF No. 132. Mr. Miller and Plaintiffs filed
cross-motions for summary judgment as to Counts VI and VII.
See Def. Miller's Mot. for Summ. J., ECF No. 87;
see also Pls.' Mot. for Summ. J., ECF No.
These motions are ripe and ready for the Court's
Motion to Dismiss under Rule 12(b)(1)
motion to dismiss under Federal Rule of Civil Procedure
12(b)(1) “presents a threshold challenge to the
Court's jurisdiction, ” and thus “the Court
is obligated to determine whether it has subject-matter
jurisdiction in the first instance.” Curran v.
Holder, 626 F.Supp.2d 30, 32 (D.D.C. 2009) (citation and
internal quotation marks omitted). “It is to be
presumed that a cause lies outside [a federal court's]
limited jurisdiction, ” Kokkonen v. Guardian Life
Ins. Co. of Am., 511 U.S. 375, 377 (1994), unless the
plaintiff can establish by a preponderance of the evidence
that the Court possesses jurisdiction, see, e.g.,
United States ex rel. Digital Healthcare, Inc. v.
Affiliated Comput., 778 F.Supp.2d 37, 43 (D.D.C. 2011)
(citation omitted). Thus, the “plaintiff's factual
allegations in the complaint . . . will bear closer scrutiny
in resolving a 12(b)(1) motion than in resolving a 12(b)(6)
motion for failure to state a claim.” Id.
(citation and internal quotation marks omitted)).
motion to dismiss for lack of jurisdiction may be presented
as either a facial or factual challenge. Achagzai v.
Broad. Bd. of Governors, 170 F.Supp.3d 164, 173 (D.D.C.
2016). “A facial challenge attacks the factual
allegations of the complaint that are contained on the face
of the complaint, while a factual challenge is addressed to
the underlying facts contained in the complaint.”
Al-Owhali v. Ashcroft, 279 F.Supp.2d 13, 20 (D.D.C.
2003) (citation and internal quotations marks omitted). When
a defendant makes a facial challenge, the Court must accept
the allegations contained in the complaint as true and
consider the factual allegations in the light most favorable
to the non-moving party. Erby v. United States, 424
F.Supp.2d 180, 182 (D.D.C. 2006). With respect to a factual
challenge, the Court may consider materials outside of the
pleadings to determine whether it has subject matter
jurisdiction over the claims. Jerome Stevens Pharms.,
Inc. v. FDA, 402 F.3d 1249, 1253 (D.C. Cir. 2005).
Motions for Summary Judgment under Rule 56
Federal Rule of Civil Procedure 56, “[t]he court shall
grant summary judgment if the movant shows that there is no
genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law.” Fed.R.Civ.P.
56(a); see also Celotex Corp. v. Catrett, 477 U.S.
317, 325 (1986). The movant “bears the initial
responsibility of informing the district court of the basis
for its motion, and identifying those portions of the
pleadings, depositions, answers to interrogatories, and
admissions on file, together with the affidavits, if any,
which it believes demonstrate the absence of a genuine issue
of material fact.” Celotex Corp., 477 U.S. at
323 (internal quotation marks omitted). “To defeat
summary judgment, the non-moving party must ‘designate
specific facts showing that there is a genuine issue for
trial.'” James Madison Project v. CIA, 344
F.Supp.3d 380, 386 (D.D.C. 2018) (quoting Celotex
Corp., 477 U.S. at 324).
ruling on cross-motions for summary judgment, the court shall
grant summary judgment only if one of the moving parties is
entitled to judgment as a matter of law upon material facts
that are not genuinely disputed. See Citizens for
Responsibility & Ethics in Wash. v. U.S. Dep't of
Justice, 658 F.Supp.2d 217, 224 (D.D.C. 2009) (citation
omitted); see also James Madison Project, 344
F.Supp.3d at 386 (“A dispute is ‘genuine'
only if a reasonable fact-finder could find for the
non-moving party; a fact is ‘material' only if it
is capable of affecting the outcome of the litigation.”
(citations omitted)). The Court “analyzes the
underlying facts and inferences in each party's motion in
the light most favorable to the non-moving party.”
James Madison Project, 344 F.Supp.3d at 386 (citing
Anderson v. Liberty Lobby, Inc., 477 U.S.
242, 247 (1986)).
stated by Plaintiffs, the “crux of this lawsuit”
is whether Plaintiffs have been de facto debarred
from competing for any OPLOG and MSC work. Pls.'
Surreply, ECF No. 109 at 3; see also Pls.'
Opp'n, ECF No. 101 at 21 (“MSC has implemented the
de facto debarment and has refused to allow MDD to
be awarded or perform any new contracts.”)
(emphasis added). In moving for summary judgment as to
Counts I and II,  the Federal Defendants argue that
Plaintiffs cannot establish de facto debarment with
respect to the OPLOG and MSC work, and that, without a
showing of de facto debarment, there is no violation
of their constitutional rights to due process under the Fifth
Amendment. See Fed. Defs.' Mot. to Dismiss, ECF
No. 88 at 16. For the reasons explained below, the Court
agrees with the Federal Defendants.
the Federal Defendants move to dismiss Count IX-the tort
claims asserted against Mr. Traugh and Mr. Robinson-for lack
of jurisdiction on four grounds: (1) those claims fall under
the Westfall Act, 28 U.S.C. § 2679, id. at
36-37; (2) the evidence shows that both federal employees
were acting within the scope of their employment during the
alleged incidents, and the United States should be
substituted as the sole defendant as the Federal Tort Claims
Act (“FTCA”) does not authorize suits against
federal officials, id. at 37-42; (3) Plaintiffs have
failed to exhaust their administrative remedies before
bringing a lawsuit under the FTCA, id. at 42-44; and
(4) the United States has not waived its sovereign immunity
for the FTCA claims, id. at 44-47. For the reasons
explained below, the Court agrees with the Federal
Mr. Miller moves for summary judgment with respect to Counts
VI and VIII, arguing that he did not breach his fiduciary
duty owed to MDD because he had a right to compete with MDD
after his resignation, and that Plaintiffs' failure to
demonstrate that he breached his fiduciary duty means that
Plaintiffs cannot establish his liability under a theory of
civil conspiracy. See generally Def. Miller's
Mot. for Summ. J., ECF No. 87. The Court agrees.
Court examines each motion separately, first considering the
alleged de facto debarment, next considering the
tort claims asserted against Mr. Robinson and Mr. Traugh, and
concluding with the torts claims asserted against Mr. Miller.
The Federal Defendants Are Entitled to Summary Judgment as to
Count I (De Facto Debarment); Mr. Bosworth and Mr.
Traugh Are Entitled to Summary Judgment as to Count II
(Violation of Clearly Established Rights)
first round of briefing, Plaintiffs argue that genuine issues
of material fact exist as to Count I and II, see
Pls.' Opp'n, ECF No. 101 at 5-6, because, inter
alia: (1) Plaintiffs have continued to be effectively
debarred from receiving OPLOG work, see Id. at 9-10;
and (2) the “OPLOG de facto debarment
of MDD” has extended to NAVSEA and MSC, see
id. at 11. The Federal Defendants respond that
Plaintiffs acknowledge that they received new contracts,
contract options, contract modifications, and contract
funding from the Department of the Navy during the alleged
debarment, see Fed. Defs.' Reply, ECF No. 104-1
at 2, but “[Plaintiffs] discount their
second round of briefing, Plaintiffs contend that they are
entitled to summary judgment as a matter of law with respect
to Count I because no genuine issue of material fact exists,
Pls.' Mot. for Partial Summ. J., ECF No. 107 at 1,
arguing that “they continue to be the subject of de
facto debarment by [the] Federal Defendants[, ]”
id. at 2. Plaintiffs' argument in the first
round of briefing that genuine issues of material fact exist
as to Count I is therefore moot. In response, the Federal
Defendants argue that Plaintiffs cannot demonstrate the
existence of de facto debarment, pointing out that
Plaintiffs ignore “twenty-nine contracts, delivery
orders, purchase orders, and funding modifications that the
[Department of the Navy] has awarded [MDD] since . . .
September 2013 . . ..” Fed. Defs.' Opp'n, ECF
No. 124 at 5. The Federal Defendants point to a NAVSEA
contract awarded to MDD in the amount of $14, 483, 912.86 on
August 21, 2014, see Fed. Defs.' Notice, ECF No.
118 at 1, arguing that said contract in addition to other
contracts, options, and modifications serve as further
evidence that there was no de facto debarment,
see Id. at 2.
Plaintiffs Have Failed to Meet the High Standard to Prove
De Facto Debarment
facto debarment occurs when a contractor or a
subcontractor has, for all practical purposes, been suspended
or blacklisted from working with a government agency without
due process, namely, adequate notice and a meaningful
hearing. Phillips I, 894 F.Supp.2d at 81 (citations
omitted). The United States Court of Appeals for the District
of Columbia Circuit (“D.C. Circuit”) has held:
[W]hen the Government effectively bars a contractor from
virtually all Government work due to charges that
the contractor lacks honesty or integrity, due process
requires that the contractor be given notice of those charges
as soon as possible and some opportunity to respond to the
charges before adverse action is taken.
Old Dominion Dairy Prods., Inc. v. Sec'y of
Def., 631 F.2d 953, 955-56 (D.C. Cir. 1980) (emphasis
added); see also Reeve Aleutian Airways, Inc. v.
United States, 982 F.2d 594, 598 (D.C. Cir. 1993)
(“[T]he typical debarment [is a] ban on contracting for
‘virtually all government work' for a fixed period
of time .. . .” (citations omitted)).
standard for proving de facto debarment is high.
E.g., Pub. Warehousing Co. K.S.C. v. Def. Supply
Ctr. Phila., 489 F.Supp.2d 30, 45 n.13 (D.D.C. 2007);
Highview Eng'g, Inc. v. U.S. Army Corps of
Eng'rs, 864 F.Supp.2d 645, 649 (W.D. Ky. 2012)
(“Highview II”) (“Plaintiffs must
meet a high standard when seeking to prove a de
facto debarment claim.”). To prevail on their
motion for partial summary judgment as to Count I, Plaintiffs
must demonstrate that there is no genuine dispute of a
material fact as to: a “systematic effort by the
procuring agency to reject all of the bidder's
contract bids.” TLT Constr. Corp. v. United
States, 50 Fed.Cl. 212, 215 (2001) (emphasis added)
(citation omitted). The Court can find de facto
debarment based on either: (1) “a statement that the
agency will not award a contract to the disappointed bidder
in the future”; or (2) “the conduct of the
agency.” Leslie & Elliott Co. v. Garrett,
732 F.Supp. 191, 195 (D.D.C. 1990); see also TLT Constr.
Corp., 50 Fed.Cl. at 215-16. “A Federal agency may
debar a person . . . .” 2 C.F.R. § 180.800;
see also Highview Eng'g, Inc. v. U.S. Army Corps of
Eng'rs, No. 3:08-CV-647-S, 2010 WL 2106664, at *5
(W.D. Ky. May 24, 2010) (“Highview I”)
(“[N]o individual person debars a contractor. Rather,
the [U.S. Army] Corps [of Engineers] takes such actions as an
Federal Defendants observe, see Fed. Defs.' Mot.
to Dismiss, ECF No. 88 at 27 n.12, “[p]reclusion from a
single contract is insufficient to establish de
facto debarment.” Highview II, 864
F.Supp.2d at 653. The Court must grant the Federal
Defendants' motion for summary judgment where Plaintiffs
“though perhaps injured in some respects, cannot
demonstrate broad preclusion from government
contracting, as the law of this [C]ircuit requires . . .
.” Trifax Corp. v. District of Columbia, 314
F.3d 641, 642 (D.C. Cir. 2003) (“Trifax
II”) (emphasis added); see also Mem. Op.,
Trifax Corp. v. District of Columbia, No. 98-cv-2824
(GK) (D.D.C. Nov. 2, 2001), ECF No. 166 at 19
(“Trifax I”) (granting defendant's