Opinion ID: 714827
Heading Depth: 1
Heading Rank: 1

Heading: introduction

Text: 9 This action arises out of the termination of a government contract to supply uranium extrusions. For 25 years, Plaintiff RMI Titanium Company (RMI) had directly contracted with the Department of Energy (the DOE) to produce uranium extrusions at RMI's site in Ashtabula, Ohio. In 1988, however, the DOE interposed Defendant Westinghouse Environmental Management Company (WEMCO) 1 as the prime management contractor at RMI's Ashtabula site and, at the DOE's direction, RMI and WEMCO entered into a subcontract 2 continuing RMI in the same production role it previously had with the DOE as a direct contractor, but now under the managerial oversight of WEMCO. 3 10 The RMI/WEMCO subcontract contained a Disputes clause which provided that all disputes arising under or related to this contract were to be resolved by submitting them to the designated Department of Energy Contracting Officer (CO), whose decision would be final and conclusive and not subject to review by any forum, tribunal or Government agency except for an appeal to the DOE Board of Contract Appeals (EBCA). 11 Shortly after RMI and WEMCO entered into the subcontract, at the DOE's direction, WEMCO instructed RMI to cease production. In accordance with the Disputes clause, RMI then submitted claims to the Contracting Officer seeking over $125 million in damages for WEMCO's and the DOE's actions. On January 4, 1993, the CO issued his decision finding merit in only one of RMI's claims for which he awarded RMI only $476,837. 12 Apparently dissatisfied with the Contracting Officer's decision, instead of appealing to the EBCA, four days after the CO issued his decision, on January 8, 1993, RMI instituted this lawsuit, asserting in its Complaint the same allegations it made in its claims to the CO. 4 However, RMI never mentioned in its Complaint that it had filed administrative CDA claims with the CO or that the CO had issued a decision. 13 In response to RMI's Complaint, the Defendants moved to dismiss pursuant to Fed. R. Civ. Pro. 12(b)(1). The Westinghouse Defendants moved to dismiss for lack of subject matter jurisdiction arguing that the Contract Disputes Act of 1978, 41 U.S.C. § 601 et seq. (the CDA) applied to RMI's claims, and thus preempted district court jurisdiction over this matter. Alternatively, they argued that even if the CDA did not divest the court of jurisdiction, the Disputes clause in the RMI/WEMCO contract precludes RMI from proceeding with a judicial action. The United States also moved separately to dismiss for lack of subject matter jurisdiction by virtue of RMI's failure to exhaust administrative remedies under the Federal Tort Claims Act and on sovereign immunity grounds. 14 District Judge Thomas Lambros referred Defendants' motions to Magistrate Judge David Perelman for Report and Recommendation. The Magistrate Judge, in two lengthy R & Rs, recommended that both the Westinghouse Defendants' and the Government's motions to dismiss be granted. In a 16-page Memorandum Opinion and Order, Judge Lambros adopted Magistrate Judge Perelman's R & Rs and dismissed RMI's action in its entirety. RMI now appeals.