[00:00:00] Speaker 04:
Our next case for argument is 22-1080, Calapristi versus United States.

[00:00:08] Speaker 04:
Mr. McKinley, when you're ready.

[00:00:11] Speaker 03:
If it please the court.

[00:00:15] Speaker 03:
I'm going to warn your honor.

[00:00:18] Speaker 03:
I have a tendency when I get nervous to talk quickly and talk loudly.

[00:00:25] Speaker 03:
Last time I was in front of this court, I was perceived as screaming at the court.

[00:00:41] Speaker 03:
if I happen to make that same mistake.

[00:00:44] Speaker 03:
There's a lot of cases, beginning with Cienega Gardens and running through Turpin v.

[00:00:49] Speaker 03:
U.S., that tell that no amount of control that the government exercises over a contract, say between a contractor and a subcontractor or a contractor and its employees, that there's no amount of control that can create privity.

[00:01:10] Speaker 03:
I don't think that decision, I don't think that line of argument and that reason is worthy of this court.

[00:01:16] Speaker 03:
I would point out that there is no analogous case by the Supreme Court.

[00:01:22] Speaker 03:
There is no analogous case by any of your sister circuits.

[00:01:27] Speaker 03:
There is no analogous case by any of the state supreme courts.

[00:01:31] Speaker 02:
No other court.

[00:01:32] Speaker 02:
The government wasn't a party to this contract, was it?

[00:01:37] Speaker 03:
I don't think the government was a party to this contract, Your Honor, because what the government did was they ordered their contractor to set up this pension system, and then they smuggled a provision into the pension plan that the government had complete control over.

[00:01:57] Speaker 00:
What are you talking about?

[00:01:58] Speaker 00:
A smuggle?

[00:01:58] Speaker 00:
Are you talking about Article 29?

[00:02:01] Speaker 00:
Well, who smuggled what, and what does smuggling mean?

[00:02:05] Speaker 03:
Spudgling means they put the plan together and they put a provision in it that purports to be controlled by the plan administrator, but it was never going to be controlled by the planning administrator.

[00:02:18] Speaker 03:
It was always going to be controlled by the government.

[00:02:21] Speaker 03:
And in fact, it was controlled by the government.

[00:02:23] Speaker 00:
Well, wait a minute.

[00:02:24] Speaker 00:
So let's be specific.

[00:02:25] Speaker 00:
Judge, will we ask you?

[00:02:26] Speaker 00:
I mean, the government wasn't a signatory to this.

[00:02:29] Speaker 00:
It was the employer, right?

[00:02:30] Speaker 00:
That's true.

[00:02:31] Speaker 00:
And the only reference to the government in the entire document is this Article 29, right?

[00:02:38] Speaker 00:
Correct.

[00:02:39] Speaker 00:
Only reference.

[00:02:41] Speaker 00:
And the reference to the government is a termination for transfer, is the termination from one contractor to another, which is determined to be in the best interests of the government.

[00:02:52] Speaker 00:
Correct.

[00:02:54] Speaker 00:
So that's control.

[00:02:56] Speaker 00:
I mean, what does that get you in terms of the government being the signatory party to this contract?

[00:03:02] Speaker 03:
Well, the government's making a promise, or the pension plan is making a promise.

[00:03:07] Speaker 03:
And it's making a promise that a specific thing is going to happen when there's a termination for transfer.

[00:03:13] Speaker 03:
Now, what you have to recognize is, mechanically, when there's a termination for transfer, there is no contractor.

[00:03:20] Speaker 03:
The contractor that the employees work for is leaving.

[00:03:24] Speaker 03:
So they have no duties going forward.

[00:03:27] Speaker 03:
They certainly have no duty to make sure that the employees continue to accrue their credit for their years of service at the Hanford site.

[00:03:34] Speaker 00:
So what happened as a factual matter here?

[00:03:37] Speaker 00:
So the new contract crafter comes in and says, I'm not going to abide by the terms of these previous contracts with other employers.

[00:03:45] Speaker 03:
It was worse than that.

[00:03:46] Speaker 03:
It was far worse than that.

[00:03:49] Speaker 03:
The new contractor came in and proposed to the government

[00:03:53] Speaker 03:
Hey, let's breach that provision.

[00:03:55] Speaker 03:
Let's breach Article 29 in their proposal to the government.

[00:03:58] Speaker 03:
When the government solicited the following contract, in the solicitation, they required that you honor Article 29.

[00:04:07] Speaker 03:
The new contractor made a proposal to the government that said, hey, let's not operate.

[00:04:15] Speaker 03:
But not for everybody.

[00:04:16] Speaker 03:
Let's just not honor it for this small group of employees that we'll call enterprise employees.

[00:04:21] Speaker 00:
And you're saying that the government, based on the language of Article 29, was obligated to do what?

[00:04:29] Speaker 00:
To require the new contractor to sign along the lines of the obligations of the former contractors?

[00:04:37] Speaker 00:
Or that the government itself is, in any event, liable for all of these monies that were lost by the employees?

[00:04:44] Speaker 03:
Or what?

[00:04:45] Speaker 03:
Obligation in Article 29 is that when there's a termination for transfer, you won't truncate the employee's accrual of years of service.

[00:04:59] Speaker 00:
But then the new contractor comes in and doesn't sign that, right?

[00:05:03] Speaker 00:
These are innocent questions.

[00:05:05] Speaker 00:
I'm just trying to get clear as to what the facts are.

[00:05:07] Speaker 03:
Let me get to it.

[00:05:08] Speaker 03:
The facts are convoluted.

[00:05:11] Speaker 03:
What happens is they propose that we truncate

[00:05:15] Speaker 03:
those benefits for the enterprise companies.

[00:05:17] Speaker 03:
Who's they?

[00:05:19] Speaker 03:
The successor contractor.

[00:05:22] Speaker 03:
The government agrees to that.

[00:05:24] Speaker 03:
So then the enterprise company employees no longer have a sponsoring employer in the plan.

[00:05:34] Speaker 03:
Their new employer in the new set of contracts is not a part of the plan.

[00:05:39] Speaker 03:
So immediately... Well, that's key, isn't it?

[00:05:43] Speaker 02:
The new employer who isn't abiding by what is in Article 29 isn't in this case.

[00:05:51] Speaker 02:
Now, there's sort of an aroma of unfairness here, but the problem is you've sued the government.

[00:05:58] Speaker 03:
And the government is liable, and I'll explain why.

[00:06:01] Speaker 03:
Because this gets to privity.

[00:06:04] Speaker 04:
Yes, but my big concern is that you litigated all of these issues already.

[00:06:10] Speaker 04:
interpreting versus United States.

[00:06:12] Speaker 04:
And we decided that you were wrong.

[00:06:15] Speaker 04:
There was no privity, no implied in fact contract.

[00:06:19] Speaker 04:
And we considered every argument you just made with regard to Article 29 in that exact decision.

[00:06:27] Speaker 04:
So what you came along here to do in an attempt to cure it is you filed a few new allegations like the Vodney Declaration and a few other pieces.

[00:06:37] Speaker 04:
But I haven't heard you rely on a single one of those as you stand here.

[00:06:42] Speaker 04:
Every word that seems to have come out of your mouth today is identical to what was already argued and already decided against you.

[00:06:50] Speaker 04:
So where in this record did you make new allegations that should cause us to ignore binding precedent on this court in Turpin?

[00:07:02] Speaker 03:
Your Honor, in Terping, this court recited that there is, quote, no evidence that the government intended to be contractually obligated to lock these other employers, employees, either through the map or by other means.

[00:07:13] Speaker 03:
And if I can finish, I'll provide you with that evidence.

[00:07:18] Speaker 03:
I think that evidence was there in Terping.

[00:07:20] Speaker 04:
Yes, but it doesn't matter what you think.

[00:07:22] Speaker 04:
And it actually doesn't even matter what I think about what was present in Terping.

[00:07:27] Speaker 04:
It's a binding decision on me, correct?

[00:07:29] Speaker 04:
Well, it's binding if you have the same facts before you, but as... You just said, I think what was present in Terping was enough.

[00:07:38] Speaker 04:
Could I hold what was present in Terping was enough?

[00:07:44] Speaker 04:
Do you understand the concept of precedent?

[00:07:46] Speaker 03:
I do, Your Honor.

[00:07:47] Speaker 03:
Could I hold what was present in Terping alone was enough?

[00:07:50] Speaker 03:
Well, the difficulty that we have is that Terping recites a set of facts that I disagree.

[00:07:56] Speaker 03:
I think a different set of facts were in the complaint in Terping.

[00:08:00] Speaker 00:
Well, you had an opportunity for petition for rehearing and to make your case.

[00:08:03] Speaker 00:
At some point, you did, but you didn't prevail on a petition for rehearing.

[00:08:09] Speaker 00:
So at some point, precedent is precedent, and you have to move on.

[00:08:13] Speaker 00:
And I thought you at least were trying to do that in this case, as the chief suggested, by coming in with an amended complaint and more different types of allegations.

[00:08:25] Speaker 00:
Am I missing something?

[00:08:27] Speaker 03:
I believe you are if I could just be allowed to get through this last set of facts.

[00:08:33] Speaker 03:
When the government terminated and transferred in 1996, they then unilaterally rewrote the pension plan.

[00:08:46] Speaker 03:
The pension committee, the plan administrator, attempted to tell the

[00:08:52] Speaker 03:
enterprise company employees that they were no longer part of the pension plan.

[00:08:55] Speaker 03:
And they said, great.

[00:08:56] Speaker 03:
And they said, OK, ERISA allows us to draw our pensions now.

[00:08:59] Speaker 03:
And they started drawing their pensions.

[00:09:01] Speaker 03:
And the government said, hey, hold on a minute.

[00:09:03] Speaker 03:
We can't have that.

[00:09:04] Speaker 03:
We can't have you drawing your pensions while you're continuing to work at the Hanford site.

[00:09:09] Speaker 03:
The optics are bad.

[00:09:10] Speaker 03:
So the government went in and said, no, you're not out of the plan.

[00:09:14] Speaker 03:
They overruled the plan administrator.

[00:09:16] Speaker 03:
They said, you're not out of the plan.

[00:09:18] Speaker 03:
You're going to remain in the plan.

[00:09:19] Speaker 03:
And we're going to rewrite

[00:09:21] Speaker 03:
the pension plan to give you the Hi-Fi benefit.

[00:09:25] Speaker 03:
So this is where the government directly involves itself and directly does so in a way that creates privity between itself and these employees.

[00:09:35] Speaker 03:
Because the government says, we're going to give you a Hi-Fi benefit.

[00:09:37] Speaker 03:
And they proceed to do so.

[00:09:39] Speaker 03:
And because they give them the Hi-Fi benefit, the government has to make contributions to the plan.

[00:09:45] Speaker 03:
And they have done so for 26 years.

[00:09:48] Speaker 03:
Now, what ties the government to that obligation?

[00:09:50] Speaker 03:
Nothing.

[00:09:51] Speaker 03:
Nothing but the MEP.

[00:09:52] Speaker 03:
That's it.

[00:09:53] Speaker 03:
The only reason the government is making those contributions into the pension plan on behalf of those employees is because of the language in the MEP.

[00:10:01] Speaker 04:
Because remember, there's no employer.

[00:10:04] Speaker 04:
Am I wrong or is this the same or a similar argument that was present in Turfey?

[00:10:11] Speaker 03:
I think it's a court that, in Terping, the court did not appreciate, and so I think it's a new argument.

[00:10:17] Speaker 04:
It was an argument that was made in Terping and that was rejected by the court when it drew its conclusions.

[00:10:23] Speaker 04:
I really think you would benefit yourself if you would focus on the new allegations and the new evidence you presented.

[00:10:30] Speaker 04:
You have some allegations regarding the Vodny Declaration and the DOE Order 3830, which I think were not present

[00:10:40] Speaker 04:
In the Terping case, I don't see how I can revisit the arguments you made in Terping and that the court rejected in a presidential decision.

[00:10:48] Speaker 04:
So I think you would really benefit yourself with only five minutes relating for all of your time if you would focus on the arguments that I'm not bound to reject because of precedent.

[00:11:00] Speaker 03:
Your Honor, I think that you're tied to the precedent in Terping and you're tied to the idea

[00:11:10] Speaker 03:
that no amount of control creates privity, but I do think you can find an exception.

[00:11:16] Speaker 03:
And I think you can find an exception when the government actually involves itself in a manner where it creates a direct relationship between itself and those third parties.

[00:11:26] Speaker 03:
And that's what happened here in this case.

[00:11:28] Speaker 03:
The new evidence is basically explaining evidence that, in the chirping opinions said,

[00:11:36] Speaker 03:
The Terping opinion said it wasn't present.

[00:11:39] Speaker 03:
The Terping decision said that the agency argument didn't prevail.

[00:11:46] Speaker 03:
Well, that argument wasn't really relevant.

[00:11:49] Speaker 03:
The Vodney Declaration establishes that it was the government that set up the map, that it wasn't done by an agent.

[00:11:57] Speaker 03:
It was the government acting as its principal that created the map.

[00:12:01] Speaker 03:
The policy of the government shows that they intended

[00:12:04] Speaker 03:
to control the map the entire time.

[00:12:07] Speaker 00:
So I'm not understanding the theory.

[00:12:09] Speaker 00:
You started by saying that we should create an exception to terping.

[00:12:14] Speaker 00:
How would you articulate that exception?

[00:12:16] Speaker 03:
The exception would be, generally speaking, in the lives of cases beginning with the Antigua Gardens and going through terping, generally speaking, government interference doesn't create privacy.

[00:12:29] Speaker 03:
Now, the court has stated that as something of a topology, and you know,

[00:12:34] Speaker 03:
It's true unless it's not true.

[00:12:36] Speaker 03:
And in this case, it's not true.

[00:12:38] Speaker 03:
Because in this case, the government interference did create prudity, because it did create a direct relationship between the government and the plaintiffs that has as its only basis, because there's no employer intervening between the two anymore.

[00:12:54] Speaker 03:
The government is paying into the map on behalf of these people, and their employer is completely out of the picture as a result of the contract change

[00:13:02] Speaker 03:
So now there is privity.

[00:13:04] Speaker 03:
I mean, privity just means there's a relationship, and there's definitely a relationship.

[00:13:07] Speaker 03:
They're paying money into the map for 26 years on their behalf.

[00:13:12] Speaker 04:
So that- Counsel, respectfully, what does privity mean?

[00:13:15] Speaker 04:
Privity does not mean there's a relationship.

[00:13:17] Speaker 04:
There are a lot of things that qualify as a relationship that don't establish privity under the law.

[00:13:22] Speaker 03:
Privity is actually a slipperier concept to nail down when you try to look it up and read about it.

[00:13:29] Speaker 03:
I would ask the court, tell me what the court interprets

[00:13:32] Speaker 03:
And I can explain why it's here.

[00:13:38] Speaker 04:
I think you have a fundamental misunderstanding about this process.

[00:13:41] Speaker 03:
I do.

[00:13:42] Speaker 03:
Privity means that there's a relationship between the two parties where they're bound to each other.

[00:13:47] Speaker 03:
If the government's not bound to these plaintiffs, why is it paying money into their pension fund for 26 years?

[00:13:53] Speaker 03:
Is it just charity?

[00:13:55] Speaker 03:
The government appears to believe that it's bound.

[00:14:02] Speaker 03:
Case that sits over top of all of this, of course, is Baltimore and Ohio, a meeting of the minds which, although not embodied in an express contract, is inferred as a fact from the conduct of the parties, showing in light of the surrounding circumstances their tacit understanding.

[00:14:18] Speaker 03:
Well, if you look at what the government's doing, their tacit understanding is they're responsible to pay for the high-five benefit for these plaintiffs, which shows that, contrary to everything the government's about to say,

[00:14:31] Speaker 03:
They understand that they're bound to these planets through the map.

[00:14:34] Speaker 04:
Otherwise, why are they making those payments?

[00:14:36] Speaker 04:
Well, you've used almost all your time.

[00:14:38] Speaker 04:
Why don't we hear from the government and see if they do say that or not?

[00:14:42] Speaker 04:
See what they say.

[00:14:44] Speaker 04:
How do I say your name, counsel?

[00:14:46] Speaker 01:
I. R. Rossi.

[00:14:47] Speaker 04:
Mr. I. Rossi, please proceed.

[00:14:49] Speaker 04:
Why don't you start right where he left off?

[00:14:51] Speaker 01:
So, Your Honor, may it please the Court.

[00:14:55] Speaker 01:
I'd like to clarify one thing that Mr. McKinley has repeatedly stated here today.

[00:15:01] Speaker 01:
He said

[00:15:06] Speaker 01:
in his reply brief at page 8, he said in his opening brief at page 13, he claims that the government through the Department of Energy has contributed money into the pension plan for 26 years for these enterprise company employees for their high-five benefits.

[00:15:26] Speaker 01:
It's patently false.

[00:15:27] Speaker 01:
I know that the court has to accept allegations of complaint as

[00:15:35] Speaker 01:
after I had pointed out to the court that there's never been one red set paid from the US Treasury directly to the pension plan.

[00:15:50] Speaker 01:
Rather, as is the case all the time, the Department of Energy would pay the contractors working on the Hanford Reservation for the work they performed, any

[00:16:01] Speaker 01:
allowable costs that go towards pension plans are eventually paid into the plan from the contractors, from the government contractors, never the agency.

[00:16:09] Speaker 01:
And Mr. McKinley recognized, admitted, yes, it's true that the money never goes from the Treasury to the pension plan, but rather

[00:16:16] Speaker 01:
DOE pays its contractors and they have to fund the pension plan.

[00:16:19] Speaker 01:
It would be like saying that the U.S.

[00:16:21] Speaker 01:
Treasury pays Northrop Grumman shareholders' dividends because we pay Northrop Grumman as part of their government contracts.

[00:16:27] Speaker 01:
That's not true.

[00:16:28] Speaker 01:
So certainly it's true that the enterprise companies had, or the enterprise company employees had this high FI benefit and the employers that are working on Hanford Reservation have to include that cost as part of their allowable pension costs.

[00:16:43] Speaker 01:
and the Department of Energy pays those costs.

[00:16:45] Speaker 01:
But it's not that the government is somehow separately has a side agreement with these enterprise company employees to pay for these costs.

[00:16:51] Speaker 04:
Do you agree that in this scenario, it seems like there's some pretty significant unfairness, but that possibly that unfairness is not to be borne by the government?

[00:17:06] Speaker 04:
Is that a fair statement?

[00:17:07] Speaker 04:
Do you think

[00:17:08] Speaker 04:
everything worked exactly as it should have for all of these employees and these employers, these government contractors.

[00:17:15] Speaker 01:
Your honor, certainly I believe that the enterprise company employees think that they were agreed somehow, and they think that they were treated unfairly.

[00:17:22] Speaker 01:
It's not part of the record, I hesitate to mention it, but the whole reason the enterprise companies were created was because everyone at Hanford worked for the federal government, and there was an effort to diversify the workforce.

[00:17:35] Speaker 01:
They were going to seek, these enterprise companies were going to seek commercial work outside of the government.

[00:17:40] Speaker 01:
And so as part of that process, they wanted to

[00:17:43] Speaker 01:
They were not going to take part in the pension plan.

[00:17:45] Speaker 01:
The employees at the time, in 1996, when the termination transfer took place, they were told this.

[00:17:53] Speaker 01:
Ultimately, they lost out on the ability to continue to accrue service time as a result of this process.

[00:17:59] Speaker 01:
The new prime contractor was the one who suggested, according to the complaints allegations, that we're going to have this special system, and there's going to be some employees who are going to try and diversify, and they're going to not be part of the pension plan.

[00:18:11] Speaker 01:
But that's not the Department of Energy's, I don't want to say problem, but that didn't create some sort of privity or contract between the Department of Energy.

[00:18:19] Speaker 04:
So even if those employees really got

[00:18:22] Speaker 04:
completely were completely disadvantaged in this process it doesn't enter to the government in terms of their employer.

[00:18:31] Speaker 01:
Certainly the plaintiffs in this case could have sued their employers though you know Lockheed Martin's enterprise companies and they could brought them into court they could sue them they could sue the plane administrator.

[00:18:40] Speaker 00:
Under what theory?

[00:18:41] Speaker 01:
Well I mean that they had and they had the opportunity to to articulate a theory saying somehow that they should have you know received pension benefits whether it was in district court or somewhere else they never brought

[00:18:54] Speaker 00:
Yeah, but they're all separate employers.

[00:18:56] Speaker 00:
I mean, you're right, anything is possible, but I don't see that they would have had a theory.

[00:19:01] Speaker 00:
So their common thread through all of this is the government.

[00:19:04] Speaker 00:
So you can understand why that would sort of stick out as the only way to recoup what they think they were entitled to.

[00:19:15] Speaker 01:
This case is complicated because you have this 92-page multi-incloric pension plan document, but that's not the contract that the plaintiffs here allege is between the United States and the plaintiffs.

[00:19:27] Speaker 01:
They only allege an implied contract.

[00:19:29] Speaker 01:
They base it on one paragraph of this 92-page document, Article 29, and they say based upon the recitations in that one paragraph,

[00:19:39] Speaker 01:
The government promised at the termination of transfer to guarantee certain pension benefits or that their service time would continue.

[00:19:45] Speaker 00:
Can I ask you, what is the differential, ballpark figure between when they were getting accrued, years of service being accrued, and the payments that would result in their pensions and that versus the high five thing?

[00:20:01] Speaker 01:
And how many employees are it?

[00:20:03] Speaker 01:
I think there are maybe a couple thousand.

[00:20:10] Speaker 01:
I think it's more than a couple thousand, but it's certainly in the hundreds.

[00:20:14] Speaker 01:
I'm sure we'll be able to let you know exactly.

[00:20:17] Speaker 01:
But I think the key to this case is to recognize that this panel does not ride on a blank slate, as Chief Judge Moore mentioned.

[00:20:27] Speaker 01:
Terping sets forth a roadmap for how to analyze this situation.

[00:20:32] Speaker 01:
And the plaintiffs, by their own admission,

[00:20:36] Speaker 01:
at pages 27 to 28 of their open brief say that we have alleged additional facts that somehow should distinguish Terping from this case.

[00:20:45] Speaker 01:
And they include these facts based on a misreading of the last footnote in the Terping case where the court said that there's not enough information about industry control or agency.

[00:20:56] Speaker 01:
And so the plaintiffs here included these four sets of new facts, the bonding declaration, the DOE Order 3030, the transfer agreement, and the press releases to show control.

[00:21:07] Speaker 01:
The problem, though, is that, as Clarence Coulson mentioned when he was speaking, it's black-lettered law that

[00:21:13] Speaker 01:
No matter the level of control that an agency exercises in a project, that doesn't create privity of contract.

[00:21:20] Speaker 01:
The Sienega Gardens case is a perfect example of that.

[00:21:23] Speaker 01:
In that case, the court said, HUD's intimate involvement with all aspects of the agreement was irrelevant.

[00:21:30] Speaker 01:
HUD conceived the structure of the transaction, prescribed and approved all of the relevant documents, including the mortgage note and its writer, and furnished most of the specific language.

[00:21:38] Speaker 01:
Despite that heavy control, the heavy pen that, you know, allegedly exerted in that case, this court rightly concluded that that control was not relevant, didn't create privity.

[00:21:52] Speaker 01:
In this case, all of the four new sets of facts that the plaintiff raises in his brief and raises in his complaint, the body declaration, the order of the transfer of human and press releases, by their own admission go to the issue of control.

[00:22:05] Speaker 01:
They wanted to show there really was control here.

[00:22:07] Speaker 01:
But again, it's irrelevant.

[00:22:08] Speaker 01:
Even if the court were to admit, the court in Turpin specifically said that, you know, talked about and cited to the allegation that the contractors couldn't make any changes to the pension plan, they couldn't do anything without the Department of Energy's permission, and still concluded that there wasn't prohibitive contract.

[00:22:25] Speaker 01:
Because control itself does not

[00:22:28] Speaker 01:
equate to an intent to contract.

[00:22:31] Speaker 01:
The court should remember here that the Turpin plaintiffs as well as the plaintiffs of the trial court below here, their complaint was dismissed because there was no evidence of an intent by the Department of Energy to contract with employees of a government subcontractor.

[00:22:48] Speaker 01:
And so they needed to come into court with a complaint that showed evidence by the Department of Energy to contract.

[00:22:54] Speaker 01:
And their theory is that, well, if there's enough control, then there must have been

[00:22:58] Speaker 01:
intent to contract.

[00:22:59] Speaker 01:
That's not what this court's case law says.

[00:23:13] Speaker 01:
In herping, this court said, quote, the same is true for appellants focus on the government's alleged control in the creation and administration of the MEPP.

[00:23:22] Speaker 01:
Our case law has made clear that the degree of government involvement with a project does not create privity between the government and a subcontractor so as to allow suit against the government.

[00:23:33] Speaker 01:
They gave other examples from the complaint in that case as to how control had been evidenced in the Terping complaint and said it was insufficient.

[00:23:41] Speaker 01:
The fact that there's more evidence of control doesn't negate the fact that control is not enough.

[00:23:46] Speaker 04:
And as... Well, then, I mean, I think that their argument hinges on they thought that the Terping Court left open the possibility for a different set of facts on control potentially being enough.

[00:23:59] Speaker 04:
And they tried to mount such a set of allegations here.

[00:24:03] Speaker 04:
And I think that they grounded this argument in footnote two from Terping.

[00:24:08] Speaker 04:
If that's not the proper way for us to understand footnote two and Terping, can you tell us what you think footnote two and Terping actually stand for?

[00:24:17] Speaker 04:
Am I right about their argument as you understand it?

[00:24:20] Speaker 01:
I think that's right.

[00:24:22] Speaker 01:
The plaintiffs have argued that footnote 2 was somehow a flag to the parties in that case that had there only been a little bit more information about control, then this case would have been different.

[00:24:40] Speaker 01:
It seems odd that the court would have relegated such an important point, like a case dispositive issue, to a footnote at the very end of the opinion.

[00:24:48] Speaker 01:
And I disagree with the reading of that footnote that somehow, if there was evidence of more control, then the case would turn out differently.

[00:24:57] Speaker 01:
The court in footnote two did talk about acting as a government's agent, or whether the government contractor in creating the multi-intolerance pension plan acted as a government's agent.

[00:25:09] Speaker 01:
A few moments ago, plaintiff's counsel admitted, and he did so in his briefs before this court, that they're not alleging an agency relationship here.

[00:25:19] Speaker 01:
Perhaps the Federal Circuit in footnote two was referencing this notion of agency and maybe if there was enough evidence regarding an agency theory, maybe the court would have come to a different conclusion.

[00:25:31] Speaker 01:
I think that's a very generous

[00:25:32] Speaker 01:
reading of the footnote.

[00:25:33] Speaker 01:
But in any regard, Plaintiff's Council admits that they're not alleging an agency relationship.

[00:25:39] Speaker 01:
He said it's the government acting as a principle in this case in creating the pension plan back in 1987.

[00:25:48] Speaker 04:
Footnote 2 has what looks to me like two distinct points in it.

[00:25:52] Speaker 04:
The first you just dealt with, but the second begins, likewise, appellants cannot support their broad allegation that only the government, a non-party to the MEP, had the authority to enforce Article 29 and compel subcontractors to remain in the MEP.

[00:26:09] Speaker 04:
So what if they could support that?

[00:26:12] Speaker 04:
What if now they had obligations

[00:26:14] Speaker 04:
or I'm sorry, not just allegations, but what they put forth, allegations and evidence that showed that the government could compel contractors to remain in the MEEB.

[00:26:24] Speaker 04:
Would that change the nature of whether this is an implied contract?

[00:26:28] Speaker 01:
No, they haven't done that in this case.

[00:26:30] Speaker 01:
The complaint doesn't have those sorts of allegations.

[00:26:32] Speaker 01:
And moreover, it's an odd reading of that footnote because no one but the Department of Energy can control which contractors work on the Hanford Reservation.

[00:26:43] Speaker 01:
Of course, that's not in dispute.

[00:26:46] Speaker 01:
issues of request for proposal and gets quotes from different government contractors, no one else but the agency and the government is going to select which particular employees come to work for the government.

[00:26:57] Speaker 01:
But that doesn't translate into an intent by the agency to enter into a contract.

[00:27:02] Speaker 01:
So remember that it's not the multi-employer pension plans that contract.

[00:27:07] Speaker 01:
According to the complaints allegations, it's this

[00:27:09] Speaker 01:
amorphous implied-in-fact contract that's based on only part of the pension plan, only Article 29, and the government had an obligation apparently to only select a particular government contract.

[00:27:23] Speaker 01:
It's hard to articulate because honestly it doesn't make a whole lot of sense, but the fact that even if the government... Is there an argument or a footnote?

[00:27:28] Speaker 01:
No, no, no, the argument.

[00:27:29] Speaker 01:
I would never suggest that the court should always come clear.

[00:27:33] Speaker 01:
It's really an issue of

[00:27:35] Speaker 01:
the fact that they misread the footnote, but even if they didn't misread it for them, you want to credit them.

[00:27:40] Speaker 01:
None of the new evidence in this case, as the trial court recognized, meets that standard.

[00:27:44] Speaker 01:
That's correct.

[00:27:44] Speaker 01:
Anything further?

[00:27:45] Speaker 01:
Two things, Your Honor.

[00:27:46] Speaker 01:
One, we also raised in our brief the issues of the other three contractual elements, consideration, and offer, acceptance, and authority.

[00:27:55] Speaker 01:
We think that those are independent reasons for affirming the court's judgment.

[00:27:59] Speaker 01:
And lastly, on a somewhat personal note,

[00:28:03] Speaker 01:
I want to thank the faculty and the students of Penn for hosting us today.

[00:28:06] Speaker 01:
I think that Penn is the greatest law school in the country.

[00:28:08] Speaker 01:
And I say that only partially because I'm a graduate.

[00:28:11] Speaker 01:
And in fact, 20 years ago, I was a student in Professor Wagner's patent litigation class.

[00:28:16] Speaker 01:
And the Federal Circuit- Well, you just aged him, didn't you?

[00:28:21] Speaker 01:
I know.

[00:28:21] Speaker 01:
But the Federal Circuit also had an argument when I was a student here.

[00:28:25] Speaker 01:
And I had the honor of being a student ambassador for Chief Judge Michelle at the time.

[00:28:29] Speaker 01:
And 20 years later, I can hear an argument from the same court.

[00:28:32] Speaker 01:
So I'm very privileged for that.

[00:28:33] Speaker 01:
And I thank the court and the folks here for that.

[00:28:36] Speaker 01:
There's nothing further.

[00:28:36] Speaker 04:
Yep.

[00:28:37] Speaker 04:
Thank you, counsel.

[00:28:38] Speaker 04:
You have some rebuttal time?

[00:28:39] Speaker 03:
Your Honor, I think you asked the government an excellent question, that the footnotes and the complaint in Terping that they couldn't support their contention, that only the government had the power to do that.

[00:28:56] Speaker 03:
But the government's admitted

[00:29:00] Speaker 03:
controls the contracts.

[00:29:01] Speaker 03:
The government controls whether or not the successor contract is going to continue to give the employees credit for their years of service.

[00:29:13] Speaker 03:
And we're talking about about 2000 people were employed under the MEP and then went to work for enterprise companies.

[00:29:22] Speaker 03:
My plaintiffs, some of them lost 15 years of service.

[00:29:27] Speaker 03:
You multiply that by, you know, they get a job in 87.

[00:29:32] Speaker 03:
They move their family to the area.

[00:29:33] Speaker 03:
They're promised that if we switch contractors, you're not going to lose your years of service.

[00:29:38] Speaker 03:
You know, they buy houses.

[00:29:40] Speaker 03:
They send their kids to school.

[00:29:41] Speaker 03:
Time passes.

[00:29:42] Speaker 03:
All of a sudden, it's 1996.

[00:29:44] Speaker 03:
The government pulls the rug out from under them.

[00:29:46] Speaker 03:
And this is a massive, massive loss of their benefits that they bargained for, that they were promised.

[00:29:52] Speaker 03:
Nobody is arguing that they didn't lose those benefits.

[00:29:55] Speaker 03:
And it's a significant amount of money for each of these pensioners.

[00:29:58] Speaker 03:
You multiply their final salary times 1.6 percent times their years of service.

[00:30:04] Speaker 03:
So, you know, you're talking hundreds of thousands of dollars for almost all of my plaintiffs.

[00:30:09] Speaker 03:
It's real money.

[00:30:11] Speaker 03:
And it is unfair.

[00:30:13] Speaker 03:
It's completely unfair that they were made this promise.

[00:30:16] Speaker 03:
The government made the promise in terms of the government roads.

[00:30:20] Speaker 03:
And the government forced it to be a part of their contract.

[00:30:23] Speaker 03:
No contractor made that decision.

[00:30:25] Speaker 03:
The government made that decision.

[00:30:27] Speaker 03:
And similarly, in 1996, when it was rescinded, the government made that decision.

[00:30:35] Speaker 03:
Sure, the contractor suggested it, but it was, as Mr. Ayurasi noted, the government controls what the contracts say.

[00:30:41] Speaker 03:
The government controls the terms and conditions.

[00:30:43] Speaker 03:
The government controlled whether or not a successor contractor was going to continue to give them the pension benefit.

[00:30:50] Speaker 03:
They don't have an employer at that point.

[00:30:54] Speaker 04:
Okay, counsel, way beyond your time.

[00:30:56] Speaker 04:
Thank you very much for your argument.

[00:30:58] Speaker 04:
This case is taken under submission.