J-Way S., Inc. v. U.S. Army Corps of Eng'rs

34 F.4th 40

J-WAY SOUTHERN, INC., Plaintiff, Appellant,

v.UNITED STATES ARMY CORPS OF ENGINEERS, Defendant, Appellee.

No. 21-1144

United States Court of Appeals, First Circuit.

May 10, 2022

Ian J. Pinta, with whom Christopher Weld, Jr. and Todd & Weld LLP were on brief, for appellant.

Anne Murphy, Attorney, Appellate Staff, Civil Division, with whom Nathaniel R. Mendell, Acting United States Attorney, Brian M. Boynton, Acting Assistant Attorney General, and Charles W. Scarborough, Attorney, Appellate Staff, Civil Division, were on brief, for appellee.

Before Thompson, Lipez, and Kayatta, Circuit Judges.

THOMPSON, Circuit Judge.

Today, we write primarily for the parties named in this case's caption, and we therefore assume their familiarity with the facts and travel, as well as the issues raised and arguments presented. This allows us to get straight to it, offering the basics and some supplemental information as needed along the way.

This matter arises out of a terminated June 2015 contract for dredging waterways in Menemsha Harbor, Martha's Vineyard -- i.e., moving "sandy material from the channels and anchorage of ... Menemsha Creek" to Lobsterville Beach via a temporary hydraulic pipeline. J-Way Southern ("J-Way") got this gig after it was the lowest bidder on a United States Army Corps of Engineers ("USACE") solicitation for the dredging work. But J-Way's performance, in USACE's view, was deficient: J-Way did not complete the work within the timeframe set forth in the contract. There was some procedural scuffling regarding J-Way's default on the contract, and, ultimately, USACE terminated the contract.¹ J-Way filed suit, alleging improper termination and breach of the contract by USACE. In response, USACE moved to dismiss for failure to state a claim. The district court granted USACE's dismissal motion, ruling (as is relevant to our decision today) that J-Way's claims were time-barred. J-Way S., Inc. v. United States, 516 F. Supp. 3d 84, 94 (D. Mass. 2021). J-Way appeals.

After careful de novo review (see, e.g., N.R. by & through S.R. v. Raytheon Co., 24 F.4th 740, 746 (1st Cir. 2022) ) of the record, the parties' appellate submissions, and the applicable law, we spy no basis to disturb the district court's decision, which is comprehensive and well-reasoned. And "when lower courts have supportably found the facts, applied the appropriate legal standards, articulated their reasoning clearly, and reached a correct result, a reviewing court ought not to write at length merely to hear its own words resonate." deBenedictis v. Brady-Zell (In re Brady-Zell ), 756 F.3d 69, 71 (1st Cir. 2014) ; see also Vargas-Ruiz v. Golden Arch Dev., Inc., 368 F.3d 1, 2 (1st Cir. 2004) ("[W]hen a trial court accurately sizes up a case, applies the law faultlessly to the discerned facts, decides the matter, and articulates a convincing rationale for the decision, there is no need for a reviewing court to wax longiloquent."). This case fits that mold. We thus affirm substantially on the basis of Judge Saris' thorough decision.

Before we reach our brief discussion of the arguments advanced on this appeal, though, we must pause to have a look at a jurisdictional issue that was much debated below. That debate hasn't been revisited before us on appeal, but "[t]his Court has an independent duty to assess the existence of subject matter jurisdiction." Almeida-León v. WM Cap. Mgmt., Inc., 993 F.3d 1, 11 n.13 (1st Cir. 2021) (citing Espinal-Domínguez v. Puerto Rico, 352 F.3d 490, 495 (1st Cir. 2003) ).

Jurisdiction

When J-Way filed its complaint in district court, it asserted admiralty jurisdiction because the parties' dispute arose out of a maritime contract under the CDA, 41 U.S.C. § 7102(d). Disagreeing with that jurisdictional premise, the government moved to dismiss or transfer for lack of subject matter jurisdiction, arguing, inter alia, that "[t]he contract is a standard Army Corps construction contract, ... and disputes arising from such contracts have been resolved at specialty government contract appeal boards or in the U.S. Court of Federal Claims for over 150 years." According to the government, its contract with J-Way was "not a maritime contract in whole or in part" -- the contract contemplated "digging earth, not [water] navigation," and thus was "a standard federal construction contract." Indeed, the government, citing a history of dredging-contract-dispute cases being heard in the Court of Federal Claims, insisted that court, as well as agency boards, have always exercised jurisdiction over matters such as this. J-Way retorted that the dispute did not arise from a construction contract at all; rather, the dispute clearly had its genesis in a maritime contract, with the contract's principal purpose being the traditionally maritime activity of dredging to make a waterway more navigable to promote commerce. Accordingly, J-Way argued, the federal district court in which it had filed its case actually enjoyed exclusive jurisdiction pursuant to 28 U.S.C. § 1333(1) (providing that "[t]he district courts shall have original jurisdiction, exclusive of the courts of the States, of ... [a]ny civil case of admiralty or maritime jurisdiction") and the CDA, 41 U.S.C. § 7102(d) (excepting appeals "arising out of maritime contracts" from the jurisdiction of the Court of Federal Claims or the agency boards of contract appeals).

After hearing argument on the issue, the district court denied the motion to dismiss for lack of subject matter jurisdiction, holding that it had admiralty jurisdiction over the dredging contract dispute. J-Way S., Inc. v. United States, 460 F. Supp. 3d 65, 70 (D. Mass. 2020). That decision wasn't appealed.²

Before us, the government now agrees that "[t]he district court had jurisdiction over this Contract Disputes Act action under 28 U.S.C. § 1333(1), and 41 U.S.C. §§ 7102(d) and 7104(b)." But we are dutybound to probe subject matter jurisdiction nonetheless. We, like the district court, find subject matter jurisdiction exists, and we agree with the district court's reasoning that led to this conclusion. By way of explanation, we borrow extensively from the district court's sound analysis (again, see In re Brady-Zell, 756 F.3d at 71 ) and pepper that solid reasoning with a few of our own observations.

Generally, the United States Court of Federal Claims has exclusive jurisdiction over contract claims against the U.S. in excess of $10,000, see 28 U.S.C. §§ 1346(a)(2), 1491(a)(1), but the CDA vests admiralty jurisdiction in the federal district courts for lawsuits against the U.S. that "aris[e] out of maritime contracts," 41 U.S.C. § 7102(d).³ See also 28 U.S.C. § 1333 (providing exclusive federal district court jurisdiction for "[a]ny civil case of admiralty or maritime jurisdiction"); 46 U.S.C. § 30906 (instructing that civil actions in admiralty against the U.S. must be brought in federal district court); El–Shifa Pharm. Indus. Co. v. United States, 378 F.3d 1346, 1353 (Fed. Cir. 2004) (noting that 28 U.S.C. § 1333 "grant[s] exclusive and original jurisdiction to federal district courts over civil cases in admiralty and maritime jurisdiction"); Thrustmaster of Tex., Inc. v. United States, 59 Fed. Cl. 672, 673-74 (2004) (observing that exclusive jurisdiction to hear CDA claims regarding maritime contracts lies with the federal district courts).

Whether a contract is a maritime contract is a difficult question given the conceptual (rather than spatial) boundaries of admiralty jurisdiction, Norfolk S. Ry. Co. v. Kirby, 543 U.S. 14, 23, 125 S.Ct. 385, 160 L.Ed.2d 283 (2004), and "the answer ‘depends upon ... the nature and character of the contract,’ " id. at 24, 125 S.Ct. 385 (alteration in original) (quoting N. Pac. S.S. Co. v. Hall Bros. Marine Ry. & Shipbuilding Co., 249 U.S. 119, 125, 39 S.Ct. 221, 63 L.Ed. 510 (1919) ). "[T]he true criterion" for making this determination is "whether [the contract in question] has ‘reference to maritime service or maritime transactions.’ " Id. (quoting Hall Bros., 249 U.S. at 125, 39 S.Ct. 221 ). Indeed, "the fundamental interest giving rise to maritime jurisdiction is the protection of maritime commerce." Id. at 25, 125 S.Ct. 385 (cleaned up) (quoting Exxon Corp. v. Cent. Gulf Lines, Inc., 500 U.S. 603, 608, 111 S.Ct. 2071, 114 L.Ed.2d 649 (1991) ).

In view of that interest, a court's inquiry should be focused "on whether the principal objective of a contract is maritime commerce." Id.; see also P.R. Ports Auth. v. Umpierre-Solares, 456 F.3d 220, 224 (1st Cir. 2006) (describing this inquiry as one focused on "whether the contract ‘relate[s] to the navigation, business or commerce of the sea’ " (alteration in original) (quoting Cunningham v. Dir., OWCP, 377 F.3d 98, 109 n.11 (1st Cir. 2004) )). Because "[w]hile it may once have seemed natural to think that only contracts embodying commercial obligations between the ‘tackles’ (i.e., from port to port) have maritime objectives, the shore is now an artificial place to draw a line" -- "[m]aritime commerce has evolved along with the nature of transportation and is often inseparable from some land-based obligations." Kirby, 543 U.S. at 25, 125 S.Ct. 385 ; cf. id. at 27, 125 S.Ct. 385 ("If a [contract]'s sea components are insubstantial, then the [contract] is not a maritime contract.").

The government's argument against the district court's exercise of jurisdiction over the contract dispute boiled down to a customs/historical practice position: Citing cases dating back to 1857, the government observed that the Court of Federal Claims (and its predecessor, the United States Claims Court) have exercised jurisdiction over government dredging contract disputes since that time. But, as the district court explained, "no court has squarely considered whether a government dredging contract is a maritime contract," and "[t]he Supreme Court, the Federal Circuit, and the Court of Federal Claims have all held that they are ‘not bound by a prior...