Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca13-19-01465/USCOURTS-ca13-19-01465-0/pdf.json

Parties Involved:
Bishop Hill Energy LLC
Appellant
Invenergy Wind LLC
Appellant
United States
Appellee

Document Text:

United States Court of Appeals 

for the Federal Circuit ______________________

CALIFORNIA RIDGE WIND ENERGY LLC, 

INVENERGY WIND LLC, BISHOP HILL ENERGY 

LLC,

Plaintiffs-Appellants

v.

UNITED STATES,

Defendant-Appellee

______________________

2019-1463, 2019-1465

______________________

Appeals from the United States Court of Federal 

Claims in Nos. 1:14-cv-00250-RHH, 1:14-cv-00251-RHH, 

Senior Judge Robert H. Hodges, Jr.

______________________

Decided: May 21, 2020

______________________

JOHN C. HAYES, JR., Nixon Peabody LLP, Washington, 

DC, argued for plaintiffs-appellants. Also represented by 

BRIAN P. DONNELLY. 

 CLINT CARPENTER, Tax Division, United States Department of Justice, Washington, DC, argued for defendant-appellee. Also represented by BRUCE R. ELLISEN, RICHARD E.

ZUCKERMAN. 

 ______________________

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2 CALIFORNIA RIDGE WIND ENERGY v. UNITED STATES

Before PROST, Chief Judge, MAYER and TARANTO, Circuit 

Judges.

TARANTO, Circuit Judge.

California Ridge Wind Energy LLC and Bishop Hill 

Energy LLC each own a windfarm that was put into service 

in 2012. Thereafter, each company applied for a cash grant 

from the federal government, based on specified energyproject costs, under section 1603 of the American Recovery 

and Reinvestment Tax Act of 2009, Pub. L. No. 111-5, 123 

Stat. 306, 364. The United States Department of the 

Treasury awarded California Ridge and Bishop Hill less 

than the amounts they had requested, rejecting as unjustified the full amounts of certain development fees included 

in the submitted cost bases. Each windfarm owner sued

the United States in the Court of Federal Claims for the 

difference between the amounts they had been paid and the 

amounts allegedly mandated by section 1603. The government counterclaimed, alleging that it had actually overpaid the two firms. 

The Court of Federal Claims ruled in favor of the government. California Ridge Wind Energy, LLC v. United 

States, 143 Fed. Cl. 757, 763 (2019); Bishop Hill Energy, 

LLC v. United States, 143 Fed. Cl. 540, 545 (2019).1 The 

sole issue on appeal is whether the two firms proved that 

their proposed development fees, in the amounts asserted, 

were properly included in their cost bases. The trial court 

held that they did not. California Ridge, 143 Fed. Cl. at 

762–63. California Ridge and Bishop Hill appeal on that 

issue, making no separate argument about the amount of 

development fees ultimately included in the cost basis if 

1 The two cases were consolidated for trial, and the 

two opinions are materially identical. California Ridge, 

143 Fed. Cl. at 759 n.1; Bishop Hill, 143 Fed. Cl. at 541 n.1. 

For simplicity, we generally cite only California Ridge.

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the trial court properly rejected their proposed amounts. 

We affirm.

I

Section 1603 requires the Secretary of the Treasury to

“provide a grant to each person who places in service specified energy property to reimburse such person for a portion of the expense of such property . . . .” Pub. L. No. 111-

5, § 1603(a). The amount of the grant is the “applicable 

percentage of the basis of such property,” id., § 1603(b)(1), 

which is the cost of the property, 26 U.S.C. § 1012(a). For 

“qualified small wind energy property,” the applicable percentage is thirty percent. Pub. L. No. 111-5, 

§ 1603(b)(2)(A), (d)(4). 

California Ridge and Bishop Hill belong to a family of 

related entities, which we refer to generally as “Invenergy.” 

Invenergy is in the business of creating windfarms. Generally, Invenergy determines what type of facility will be 

built, acquires the legal entitlements to construct that facility, and ensures that the facility is properly constructed. 

Invenergy uses various subsidiaries to perform different 

functions in the creation task; relevant to this appeal are 

Invenergy Wind North America LLC (IWNA) and Invenergy Wind Development North America LLC (IWDNA). Invenergy also partly or wholly owns or controls, through 

various subsidiaries, some of the completed windfarms. 

California Ridge and Bishop Hill each own a namesake 

windfarm located in central Illinois. Each firm is controlled by Invenergy and owned through a partnership between Invenergy and Firstar Development (USBank).

Development of the Bishop Hill windfarm began in 

2005. Development of the California Ridge windfarm began in 2008. Bishop Hill LLC and California Ridge Wind 

Energy LLC were formed on August 1, 2006, and September 26, 2008, respectively.

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On July 18, 2011, years after development work began, 

Bishop Hill entered into a development agreement with 

IWNA. J.A. 14783. The agreement states that “IWNA has 

provided development services to [Bishop Hill] to assist it 

in developing the Project,” including “negotiating construction financing terms, negotiating the project and operational documents necessary or appropriate for the Project, 

obtaining permits and performing other services relating 

to the Project.” Id. In exchange for those services, Bishop 

Hill was obligated to pay IWNA $60 million. Id. California 

Ridge entered a similar development agreement with 

IWDNA on February 29, 2012, also long after development 

of its windfarm began. J.A. 14780. The California Ridge 

agreement states that “IWDNA has provided and hereby 

agrees to provide further development services” identical 

to those listed in the Bishop Hill agreement. Id. In exchange, California Ridge was obligated to pay IWDNA 

$50 million. Id. 

Payment under the Bishop Hill agreement occurred on 

July 5, 2012—involving a round trip of funds starting and 

ending with IWDNA. On that day, IWDNA transferred 

$60 million to Bishop Hill, which then wired $60 million to 

IWNA—the entity owed the money under the agreement. 

The same day, IWNA wired $60 million to IWDNA.

Payment under the California Ridge agreement occurred on November 19, 2012—also involving a round trip 

of funds starting and ending with IWDNA. On that day, 

IWDNA transferred $50 million to California Ridge, which 

then wired $50 million back to IWDNA—the entity owed 

the money under the agreement.

On August 13, 2012, Bishop Hill applied to Treasury 

for a section 1603 grant totaling $129,923,109. To support 

its request, Bishop Hill submitted a breakdown of its direct 

and indirect costs. Bishop Hill included the $60 million development fee in the indirect costs of its windfarm and, of 

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CALIFORNIA RIDGE WIND ENERGY v. UNITED STATES 5

that $60 million, allocated $56,956,837 to section-1603-

qualified property. J.A. 1266. 

On November 19, 2012, the same day that it paid 

IWDNA the development fee, California Ridge applied for 

a section 1603 grant totaling $136,858,980. To support its 

request, California Ridge submitted a cost breakdown similar to Bishop Hill’s. Of the $50 million development fee, 

California Ridge allocated $49,315,067 to section-1603-

qualified property. J.A. 1270.

On October 9, 2012, Treasury awarded Bishop Hill 

$117,216,098—which was $12,707,011 less than the 

amount Bishop Hill sought. Treasury explained:

The amount requested was reduced because the 

presented cost basis was higher than open market 

expectations for projects of this size and in this location and the transaction involved related parties 

and/or related transactions. The cost basis has 

been adjusted to allow for base costs plus an appropriate markup (to include reasonable overhead, 

profit, and, if appropriate, development fees) resulting in a total that more closely reflects the 

amount that would have been paid in an arms’ 

length transaction between parties with adverse 

interests.

J.A. 6525. 

On December 5, 2012, Treasury awarded California 

Ridge $127,699,997—which was $9,158,983 less than the 

amount California Ridge sought. Treasury’s explanation 

for the reduction was identical to that given to Bishop Hill. 

J.A. 6523. 

On March 28, 2014, California Ridge and Bishop Hill 

each filed a complaint against the United States in the 

Court of Federal Claims, alleging that Treasury had unlawfully withheld payment mandated by section 1603. 

Each sought damages in the amount that Treasury had 

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reduced its requested awards. The government counterclaimed, alleging the “development fees” specified in the 

two development agreements were not includable as eligible costs given the circumstances and characteristics of 

those non-arm’s-length agreements—which the government characterized as “sham” transactions. The government sought to recover the amounts of the awards 

attributable to the development fees—$5,635,537 from California Ridge and $4,380,039 from Bishop Hill.

The trial court ruled in favor of the government. The 

court determined that California Ridge and Bishop Hill 

failed to show that the development agreements had economic substance and concluded that the agreements were

sham transactions. California Ridge, 143 Fed. Cl. at 761–

62. The court determined that California Ridge’s evidence—in particular, the “independent certification” of the 

development fees proffered by California Ridge and Bishop 

Hill’s accounting firm, Deloitte; the development agreement “without quantifiable services”; and the “round-trip 

wire transfer that began and ended in the same bank account, on the same day”—fell “well short” of showing that 

the development agreements were not shams and, more 

generally, that the development-fee amounts stated in 

those agreements were eligible costs. Id. at 762. Accordingly, the court dismissed California Ridge’s and Bishop 

Hill’s complaints and entered judgment for the government

in the amounts it sought. Id. at 763; see J.A. 1–2.

California Ridge and Bishop Hill timely appealed, and 

we consolidated the appeals. We have appellate jurisdiction under 28 U.S.C. § 1295(a)(3). The Court of Federal 

Claims had jurisdiction over the claims under the Tucker 

Act, 28 U.S.C. § 1491(a)(1); as is undisputed, section 1603 

is a money-mandating statute. The trial court also had jurisdiction over the overpayment-based counterclaims. 

28 U.S.C. §§ 1503, 2508.

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II

On appeal, California Ridge2 argues that the Court of 

Federal Claims failed to make sufficient findings of fact to 

allow this court to meaningfully review its decision, that 

the facts it did find are clearly erroneous, and that its conclusion that the development agreements were sham transactions is a legal error. If those errors are corrected, 

California Ridge argues, it is entitled to the amount of the 

section 1603 grants disallowed by Treasury. California 

Ridge presents no separate challenge to the court’s award

if the development fee amounts were properly disregarded.

As the Court of Federal Claims concluded, and California Ridge has not meaningfully disputed on appeal, it was 

California Ridge’s burden to justify the amount of the development fee it claimed in support of the grant amount 

(30% of the eligible costs) it sought. See California Ridge, 

143 Fed. Cl. at 760; see WestRock Virginia Corp. v. United 

States, 941 F.3d 1315, 1318 (Fed. Cir. 2019) (invoking for 

section 1603 the established burden rule for tax deductions); cf. Alt. Carbon Resources, LLC v. United States, 939 

F.3d 1320, 1328 (Fed. Cir. 2019); WMI Holdings Corp. v. 

United States, 891 F.3d 1016, 1021–22 (Fed. Cir. 2018). 

The trial court found that California Ridge had not carried 

that burden. Thus, the question before us is whether the 

Court of Federal Claims committed reversible error in so

finding.

“The characterization of a transaction for tax purposes 

is a question of law that is subject to de novo review, while 

the underlying facts are reviewable for clear error.” Salem 

Financial, Inc. v. United States, 786 F.3d 932, 940 

2 On appeal, there is no material distinction between 

California Ridge and Bishop Hill. For simplicity we use 

“California Ridge” to refer to both parties, unless otherwise 

noted.

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8 CALIFORNIA RIDGE WIND ENERGY v. UNITED STATES

(Fed. Cir. 2015). “A finding is ‘clearly erroneous’ when[,] 

although there is evidence to support it, the reviewing 

court on the entire evidence is left with the definite and 

firm conviction that a mistake has been committed.” 

United States v. U.S. Gypsum Co., 333 U.S. 364, 395 (1948). 

Whether the trial court made sufficient factual findings is 

reviewed for abuse of discretion. See Medtronic, Inc. v. 

Daig Corp., 789 F.2d 903, 906 (Fed. Cir. 1986).

III

Section 1603 provides for government reimbursement 

to qualified applicants of a portion of the “expense” of putting certain energy-generating property into service. 

Pub. L. No. 111-5, § 1603(a). That expense is measured by

the “basis” of such a property, id., § 1603(b)(1), and “basis”

is defined as “the cost of such property,” 26 U.S.C. 

§ 1012(a). Accordingly, California Ridge, to support its 

claim, was required to prove that the dollar amounts of the 

development fees claimed—stated in the development 

agreements and paid to IWNA and IWDNA out of IWDNA’s 

own funds—reliably measured the actual development 

costs for the windfarms. 

We read the Court of Federal Claims opinion as finding 

that the amounts stated in the development agreements do

not reliably indicate the development costs. That finding 

is not clearly erroneous. It is sufficiently supported by at 

least the round-trip nature of the payments; the absence in 

the agreements of any meaningful description of the development services to be provided; and the fact that all, or 

nearly all, of the development services had been completed 

by the time the agreements were executed. 

California Ridge argues primarily that the development agreements had economic purpose and that, therefore, the court’s holding that those agreements were sham 

transactions was error. But that argument does not establish that the trial court erred on the distinct question 

whether the dollar amounts of those agreements are a 

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CALIFORNIA RIDGE WIND ENERGY v. UNITED STATES 9

reliable indicator of the true development costs. Because 

we see no clear error in the trial court’s finding on that issue, California Ridge cannot prevail regardless of whether 

additional proof would be needed to characterize the transactions as shams, an issue we need not address.

A

Three aspects of the development agreements support 

the trial court’s finding that the agreement-specified development fees do not reliably establish the actual development costs.

First, California Ridge paid the development fees with 

funds it obtained from another Invenergy subsidiary, resulting in a round-trip transaction in which the funds left 

from and returned to the same pocket on the same day. As 

noted by relevant Treasury guidance, “in certain circumstances, a taxpayer’s stated cost for an asset does not reflect the true economic cost of that asset to the taxpayer 

and will be ignored for purposes of determining the basis of 

the asset.” U.S. Dep’t of the Treasury, Evaluating Cost Basis for Solar Photovoltaic Properties 1 (2011) (Cost Basis 

Guidance) (quoting Bryant v. Comm’r, 790 F.2d 1463, 1466 

(9th Cir. 1986)). This may be the case when “a transaction 

is not conducted at arm’s-length by two economically selfinterested parties or where a transaction is based upon peculiar circumstances.” Id. (quotation marks omitted) (quoting Lemmen v. Comm’r, 77 T.C. 1326, 1348 (1981)). Here, 

not only was the amount of the development fee negotiated 

between related entities, the fee was paid in a round-trip 

transaction such that neither the payor nor the payee was 

materially affected by the transaction. Such circumstances 

are “peculiar.” And substantively, the trial court could reasonably view the agreed amount as not reliably indicating 

the actual value transferred, since the economic impact on 

payee or payor of the round-trip movement of money was, 

if not zero or negligible, wholly unrelated to the dollar figures written into the agreements.

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California Ridge contends that the characterization of 

the payments as nothing more than “round-trip” wire 

transfers ignores the complicated treatment featured in Invenergy’s accounting books. As to the specific California 

Ridge development fee (as opposed to the Bishop Hill fee): 

there is evidence that payment was meant to be funded by 

Invenergy Wind Global—yet another Invenergy entity—

but at the time that payment was due, IWDNA happened 

to be holding the money. J.A. 3387–88. Thus, California 

Ridge posits that moving the money directly from IWDNA 

to California Ridge was a transactional shortcut, which left 

out intermediate steps of moving money up one side of the 

Invenergy organizational chain and then back down another. J.A. 3314–15. But even if Invenergy intended for 

the money to come from the pocket of one Invenergy subsidiary and end in the pocket of another, both pockets still 

are Invenergy’s. The trial court could readily find that the

transaction, despite any characterization in Invenergy’s accounting books, did not change the economic positions of 

IWDNA or California Ridge in anything like the amount 

stated in the agreement. See Frank Lyon Co. v. United 

States, 435 U.S. 561, 573 (1978) (“The Court has never regarded the simple expedient of drawing up papers as controlling for tax purposes when the objective economic 

realities are to the contrary.” (internal citation omitted)). 

As to the specific Bishop Hill fee: there is evidence that the 

initial payment from IWDNA to Bishop Hill was treated as 

a loan to IWNA, which IWNA paid back later that day after 

receiving payment from Bishop Hill, using the money 

IWDNA gave it. J.A. 3321–22. But even so characterized, 

the transaction did not change the economic position of any 

party in anything like the amount stated in the agreement. 

Therefore, Invenergy’s accounting treatment does not undermine the Court of Federal Claims’ determination that 

the development fees are not a reliable indicator of value.

Second, the development agreements lack any meaningful description of the services provided. The 

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development agreements obligate Invenergy to perform 

only generic development services: “[n]egotiat[e] construction financing terms, negotiat[e] the project and operational documents necessary or appropriate for the Project, 

obtain[] permits and perform[] other services relating to 

the Project.” J.A. 14780, 14783. There is no concrete specification of services that, if examined, might lend support 

to the amount set in the agreement for a premium on those 

services. And the choice to include only a highly generic 

description may reasonably be taken to suggest that the fee 

was not the result of a careful determination of what premium was justified for the particular work done.

It is no answer to say, as California Ridge does, that 

there is extensive evidence that services were performed 

that come within the generic descriptions in the agreements. Development services certainly were provided to 

California Ridge. In its cost-breakdown submitted to 

Treasury, California Ridge described several categories of 

indirect costs separately included in the grant request, 

such as “Development legal,” “Internal Development,” and 

“Misc Site Development.” J.A. 6530, 6569. And trial testimony provides some further details. See, e.g., J.A. 3288–

89 (outside counsel work, for “any number of development 

activities,” including “zoning and permitting”; payroll and 

travel costs for Invenergy’s employees). But the generic 

character of the service description in the agreement 

makes it reasonable to find unproven the assertion that the 

fee amounts set in those agreements were a reliable indicator of the value of the development work.

Third, the development agreements were executed after the development services were substantially completed. 

The Bishop Hill agreement states that Invenergy “has provided development services,” J.A. 14783 (emphasis added), 

while the California Ridge agreement states that Invenergy “has provided and hereby agrees to provide further 

development services,” J.A. 14780 (emphasis added). Because the services were already rendered, in full or in large 

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part, the negotiated price for a premium as part of those 

services was not part of a pre-acquisition market transaction that would lend the price reliability as an indicator of 

market value.

The facts we have summarized provide a strong basis 

for the Court of Federal Claims’ determination that California Ridge did not prove that the development fees stated 

in the agreements were reliable indicators of the development costs. And we see no clear error when we consider 

the foregoing facts together with California Ridge’s additional arguments, discussed next.

B

California Ridge argues that the Court of Federal 

Claims erred because its sham-transaction determination 

effectively denies Invenergy the ability to transfer value to 

California Ridge by selling its services to California Ridge 

at fair market value. That contention is incorrect. In this 

case, the trial court could reasonably find, on the particular 

facts, that the agreement-stated figures do not accurately 

value eligible costs. That is hardly a general bar to 

properly valued transactions within the Invenergy family.

California Ridge also argues that the development 

agreements had economic substance because the economic 

position of third-party USBank was affected by the roundtrip fee payments. But California Ridge forfeited this argument by not raising it below. We may deem an argument 

forfeited when a party raises it for the first time on appeal. 

Personal Audio, LLC v. CBS Corp., 946 F.3d 1348, 1354 

(Fed. Cir. 2020); Sage Products, Inc. v. Devon Industries, 

Inc., 126 F.3d 1420, 1426 (Fed. Cir. 1997). California Ridge 

cites a portion of its closing statement to show that it raised 

the point to the trial court, Appellants’ Reply Br. 15, but 

those statements were made to explain how USBank would 

be affected if the development fees were not included in the 

windfarms’ bases, J.A. 3579–80. The cited statements do 

not show that California Ridge previously argued that the 

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payment of the development fees affected USBank. Therefore, California Ridge has forfeited the argument.

California Ridge further argues that the development 

agreements had economic substance because they created 

a positive net cash flow to Invenergy. The argument that 

there is some positive net cash flow to Invenergy does not 

undermine the essential finding on the only issue on appeal—that the agreement-specified figures themselves 

were not proved to be accurate values for the costs at issue. 

Indeed, this argument is premised on faulty calculations. 

At trial, California Ridge’s witness Mr. Murphy determined the net cash flow to Invenergy by subtracting Invenergy’s equity contribution to each windfarm from the 

respective development fee. J.A. 3016–26. In turn, Mr. 

Murphy determined Invenergy’s equity contribution by 

subtracting the amount of third-party funding from the total cost of the windfarm. J.A. 3019–22. When performing 

this calculation, however, Mr. Murphy used a total facility 

cost that included the cost of the development fee. Compare J.A. 3020 with J.A. 6568. The implication of Mr. Murphy’s own testimony, it appears, is that the net cash to 

Invenergy is independent of the amount of the development 

fee. Such an implication undermines, rather than supports, any inference that the amounts of the development

fees are a reasonable indication of the development costs. 

In addition, California Ridge argues that the independent attestation of its accounting firm, Deloitte, shows that 

the development agreements have economic substance. 

But those attestations do not prove that the fees are a reliable indication of cost. In its memo to California Ridge, 

Deloitte indicated that its examination was “primarily concerned with the potential errors of classification of assets 

as eligible property and determination of eligible basis 

. . . .” J.A. 14690. Deloitte’s examination of the development fees appears to have been focused on whether the development fees were allocable to grant-eligible costs. And 

it concluded that Invenergy’s assertions that “the full 

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amount of the development fee is capitalizable to the project assets and that the allocation to basis eligible for Section 1603 grants is appropriate” were reasonable. 

J.A. 14701. Deloitte did not independently examine and 

determine whether the dollar amounts of the development 

fees accurately reflected the value of the premium on development work, as California Ridge claims. Although 

Deloitte stated that “the amount of the fee is consistent 

with the amounts paid by other third[-]party investors in 

other Invenergy projects,” it did not aver that the amount 

of the fee was an accurate measure of cost in this particular 

circumstance. Id.

Lastly, California Ridge argues that the testimony of 

its expert Mr. Gross shows that the development fees are 

reliable measures of the value Invenergy provided to the 

windfarms. In particular, California Ridge argues that Mr. 

Gross’s testimony shows that the amount of the fees was 

within the range of “appropriate markups” identified by 

Treasury in certain published guidance. That guidance describes three approaches to determining the appropriate 

costs basis for purposes of section 1603. Cost Basis Guidance, at 3–4. Under the “cost approach,” an applicant 

“should clearly show the cost buildup, including hard costs, 

soft costs, and profit.” Id. at 4. The guidance further provides that an applicant may include a “markup” in its cost 

basis and that “appropriate markups typically fall in the 

range of 10 to 20 percent.” Id. California Ridge argues that 

the amounts of the development fees fall in that range, 

when measured as a percent of the other grant-eligible 

costs. But California Ridge has not established that this is 

an appropriate reading of the guidance, which specifies 

that markups are appropriate only when they are consistent with the “scope of the work for which the markup is 

received.” Id. That language suggests using a percentage 

of the cost of the development work provided, rather than 

of all grant-eligible costs. And, as discussed above, the services in the development agreements are described so 

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generically as to make it difficult to determine what specific work the development-fee “markups” are tethered to. 

Therefore, Mr. Gross’s testimony that the amounts of the 

development fees comply with Treasury’s guidance does 

not establish clear error on the trial court’s behalf. 

We need not decide whether Mr. Gross’s testimony—

regarding the cost approach or the other approaches for determining basis—might have supported a finding in California Ridge’s favor regarding the development fees. The 

question on appeal is whether we are left with a definite 

and firm conviction that the trial court erred in finding to 

the contrary. We are not.

IV

California Ridge argues that the Court of Federal 

Claims clearly erred in two findings of fact.

First, it disputes the trial court’s finding that Mr. 

Schueler “did not give testimony specific[ally] related to 

the development services outlined in the three-page development agreement[s].” Appellants’ Br. 18 (quoting California Ridge, 143 Fed. Cl. at 761). We conclude, however, that 

the court’s finding is not clearly erroneous in light of the 

record. The court noted that Mr. Schueler testified that he 

was “not immediately familiar” with the development 

agreements. California Ridge, 143 Fed. Cl. at 761 (citing 

J.A. 2911). California Ridge cites many portions of Mr. 

Schueler’s testimony as purportedly showing the extensive 

development work that he and his team did at the windfarms. Appellants’ Br. 18–19. But much of that testimony 

is about the type of development work that Mr. Schueler 

did for Invenergy windfarms generally, see, e.g., J.A. 2805–

06, 2815–17, and the rest of his testimony, while focused 

on development work done at the Bishop Hill or California 

Ridge windfarms, does not indicate any relation between 

the work done and the development agreements, see, e.g., 

J.A. 2837–39, 2849–60. Additionally, the documents that 

California Ridge cites as evidence of the development work 

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done are all dated earlier than the relevant development 

agreement, see, e.g., J.A. 12982–92 (dated May 3, 2011), 

J.A. 13034–35 (dated June 20, 2011); thus, these documents do not show that the work documented was specifically related to the services outlined in the development 

agreements. Therefore, the Court of Federal Claims’ finding that Mr. Schueler did not give testimony specifically 

related to the development agreements is not clear error. 

Second, California Ridge challenges the court’s finding 

that the developers did not quantify the services provided 

under the agreements. Appellants’ Br. 22–23 (citing California Ridge, 143 Fed. Cl. at 762). California Ridge argues 

that the services to be provided were clearly defined, it was 

possible to objectively verify whether the services were performed, and the services were quantified by the $50- and 

$60-million development fees. We understand the challenged trial-court finding, however, as meaning that California Ridge failed to provide any specificity as to what, 

concretely, was done under the development agreements

that would warrant the development-fee premiums in the 

amounts stated in the agreements. So understood, the 

finding is not clearly erroneous. 

As discussed above, the development agreements obligate Invenergy to perform development services identified 

only at a very high level of generality. And California 

Ridge’s provided method for determining whether those 

tasks have been completed is equivalent to a determination 

that the project has been completed. Such a determination 

does not show that the development agreements were independently valuable and necessary when there are many 

other costs—all necessary to the completion of the projects—also accounted for in California Ridge’s evidence. 

Lastly, although California Ridge did provide evidence as 

to how it arrived at the $50- and $60-million figures, see 

J.A. 2964–78, that evidence does not show that the valuations were reliable. Therefore, the Court of Federal Claims 

did not clearly err when it found that the development 

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agreements provide only a general valuation of non-specific 

services—in its terminology: the services are not “quantifiable.” California Ridge, 143 Fed. Cl. at 762.

V

For the foregoing reasons, we affirm the judgment of 

the Court of Federal Claims.

Costs awarded to the appellee. 

AFFIRMED

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