General Dynamics Corp. v. United States (09-1298)

argument 09-1298

General Dynamics Corp. v. United States

Supreme Court of the United States 59 min 7 speakers 8 chapters transcribed 6 days ago official recording ↗

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What is the core dispute between General Dynamics and the United States in this case?

John G. Roberts 0:01

We'll hear argument first this morning in case zero nine twelve ninety eight, General Dynamics versus United States and the consolidated case, zero nine thirteen oh two. Boeing Company versus United States. Mr. Phillips.

Paul D. Clement 0:14

Thank you, Mr. Chief Justice, and may it please the court. The proposition the petitioners are here challenging is the one uh adopted or embraced by the Federal Circuit. It says that the United States government can declare that certain of its government contracting partners have operated in default. and under those circumstances can reach into the government contractor's pocket withdraw at the time one point three five billion dollars of of monies that were uh spent by the United States, but for services that were rendered without question pursuant to the contract, pursuant to the instructions of the United States government. That when the contractor seeks to defend against the claim that uh it has engaged in some kind of default conduct,

Paul D. Clement 1:00

that the government can assert the state secrets privilege and in so doing deprive the contractor of the ability effectively to respond to the government's uh conclusion. Under those circumstances, it seems to me that the statement in this court's decision in United States versus Reynolds Which is that The government is certainly free to assert the state secrets privilege, but when it does so it has to assume certain responsibilities that come from it. at least in the circumstances where the United States is the moving party.

Ruth Bader Ginsburg 1:32

Mr Phillips, when the contractors Uh when they fail to deliver the first aircraft, uh the time specified by the contract. Their reason was that its costs would far outrun the contract price. and is so it sought to reformulate the contract. At that time Correct me if I'm wrong, but I think at that time The contractors said nothing at all about the superior knowledge and the government's obligation to share information that it hadn't shared.

Paul D. Clement 2:12

There was nothing uh specific with respect to that, Justice Ginsberg. The the first time The contractors identified the superior knowledge problem arose obviously when the government took the extraordinary step of issuing a cure notice. Because up until that point, obviously, the parties are attempting to negotiate and work to a final resolution of this project, as you would hope any contracting entities would, to bring the contract to a happy resolution. But

Ruth Bader Ginsburg 2:38

you would expect them to say if they if that was the impediment. to going forward on this contract to at least mention it.

Paul D. Clement 2:48

Well, I you have to I think you have to put it in context, Justice Kinsburg, because during this period of time, obviously there there were consistent efforts and requests being made to get access to both the uh B two and the A one hundred seventeen uh uh st stealth technologies. And and there were discussions and went back and forth and the district court and the Court of Federal Claims specifically held. Eventually the information was forthcoming, but it was candidly too little and too late in order to effectively allow the contract to proceed a as planned. So I think you I mean I I agree, uh you know, in a perfect world maybe you would have identified this, but in this situation The parties are simply trying to come to some kind of a resolution that allows both sides to be satisfied by the final uh

Paul D. Clement 3:31

disposition.

Elena Kagan 3:32

Why wasn't the need to share that technology a part of this contract. or condition to the contract. I I've gone through The contract that or not all of it. Enough of it. I haven't found anywhere in the contract that it requires the US to share information with you. Does that have anything to do with what due process would require? No I think I think Justice Suddenly I I I I'm going to pose a hypothetical. Let's assume the contract required the sharing of state secrets. and the government then invokes its privilege. Is that a different case than this one? In terms of due process. Um Wouldn't the lat wouldn't the former situation where it's made been made a condition of the contract require a different treatment