Court Opinion

ID: 9325237
Source: CourtListenerOpinion
Date Created: 2022-12-13 21:01:33.552233+00
Date Added: 2024-06-11T17:14:58.881418
License: Public Domain

In the United States Court of Federal Claims
                                                 No. 13-821
                                        (Filed: 13 December 2022) *

**************************************
INGHAM REG. MED. CENTER,             *
n/k/a MCLAREN GREATER LANSING,       *
et al.,                              *
                                     *
                  Plaintiffs,        *                        Breach of Contract; Mutual Mistake of Fact;
                                     *                        Class Certification; Summary Judgment;
v.                                   *                        TRICARE Reimbursement; Medicare
                                     *                        Reimbursement; Duty; Breach; Damages;
THE UNITED STATES,                   *                        Negative Implication Canon; Risk-shifting.
                                     *
                  Defendant.         *
                                     *
**************************************

      Alexander J. Pires, Jr., Pires Cooley, of Washington, DC, with whom was Gregory A.
Brodek, Duane Morris LLP, of Bangor, ME, for plaintiffs.

        A. Bondurant Eley, Senior Trial Counsel, with whom were Steven J. Gillingham,
Assistant Director, Patricia M. McCarthy, Director, Commercial Litigation Branch, and Brian
M. Boynton, Principal Deputy Assistant Attorney General, Civil Division, U.S. Department of
Justice, all of Washington, DC, for defendant.

                                          OPINION AND ORDER

HOLTE, Judge.

        Plaintiffs are six hospitals purporting to represent a class of approximately 1,610
hospitals across the United States in a suit requesting amongst other things the Court interpret
what the Federal Circuit has deemed an “extremely strange” contract. This contract arose when
hospitals complained the government underpaid reimbursements for Department of Defense
Military Health System, TRICARE, outpatient services rendered between 2003 and 2009. After
running a data analysis, in 2011, the government voluntarily entered a discretionary payment
process contract with plaintiffs, offering net adjusted payments to reflect the Medicare blended
rate for outpatient radiology claims. On 9 June 2022, after nine years of litigation and one
Federal Circuit appeal, this Court heard oral argument regarding the government’s motion for
summary judgment reviewing three issues: (1) breach of contract; (2) mutual mistake of fact;

*
 This Opinion was initially filed under seal on 28 November 2022 pursuant to the protective order in this case. The
Court provided the parties the opportunity to submit proposed redactions on or before 12 December 2022. On 12
and 13 December 2022, the parties confirmed by email they did not have any proposed redactions. This Opinion is
now reissued for publication in its original form.
and (3) class certification. For the reasons detailed in this opinion, the Court: (1) grants in part
and denies in part the government’s motion for summary judgment as to plaintiffs’ breach of
contract claim; (2) grants the government’s motion for summary judgment as to plaintiffs’
mutual mistake of fact claim; and (3) defers ruling on plaintiffs’ motion for class certification.

        As explained infra, the Court holds the government did not have a duty to obtain and
adjust original native data from plaintiff hospitals, see infra Section IV.A, the government did
have a duty to correctly adjust data from the government’s TMA database, see infra Section
IV.B, the government did have a duty to correctly consider zip codes for plaintiff hospital
locations not provided by the hospitals in their discretionary payment submissions, see infra
Section IV.C, the government breached its duty to correctly adjust data from TMA’s database,
see infra Section IV.D, plaintiffs were not obligated to pre-check TMA’s data, see infra Section
IV.E.1, the government did not prove the discretionary payment agreement shifted the risk of all
data issues to plaintiff hospitals, see infra Section IV.E.2, and there was no mutual mistake of
fact, see infra Section V. The Court declines to rule on class certification at this time. See infra
Section VI. As the only surviving breach of contract claim is the government’s duty to extract,
analyze, and adjust line items from its database, the parties shall next file a joint status report
regarding scheduling for updated class certification briefing.

        Finally, as the parties confirmed in the 11 May 2022 pre-oral argument status conference,
several pending evidentiary motions were not consequential for summary judgment and the
Court accordingly stays: the government’s motion to exclude inadmissible evidence pursuant to
Rule 408; plaintiffs’ motion to exclude expert opinions of Jane Jerzak; plaintiffs’ motion to
exclude expert opinions of Anthony Fay; the government’s motion to strike “Rule 408 Evidence
Relied on by Plaintiffs in Summary Judgment Briefing”; the government’s motion to strike
“Paragraphs 3 - 10 of the Dale Thompson Declaration”; the government’s motion to strike
“Paragraphs 7 and 18 of the Declaration of Sere Allen, and Associated Briefing”; and plaintiffs’
motion to exclude expert opinions of David Kennell.

I.        Relevant Background

          A.      Factual History

        TRICARE is a “military health care system” which “provides medical and dental care for
current and former members of the military and their dependents.” Ingham Reg’l Med. Ctr. v.
United States, 874 F.3d 1341, 1342 (Fed. Cir. 2017). TRICARE Management Activity
(“TMA”), a “field office in the Defense Department [‘DoD’],” managed the TRICARE system. 1
N. Mich. Hosps., Inc. v. Health Net Fed. Servs., LLC, 344 F. App’x 731, 734 (3d Cir. 2009).
Hospitals providing TRICARE services are reimbursed according to DoD guidelines. In 2001,
Congress amended the TRICARE statute to require DoD to follow Medicare rules when
reimbursing outside healthcare providers. Ingham Reg’l Med. Ctr., 874 F.3d at 1343 (citing 32
C.F.R. § 199.14). Due to “the lack of TRICARE cost report data comparable to Medicare’s”
figures, TMA, however, found it impracticable to immediately adopt Medicare reimbursement
rules. Id. (citation omitted). To facilitate transition to Medicare rules, in 2005, DoD issued a
Final Rule “which provided a more detailed explanation of the payment rules for hospital-based

1
    TMA is now known as the Defense Health Agency.

                                                     -2-
outpatient services.” Id. The rule specified “[f]or most outpatient services, hospitals would
receive payments ‘based on the TRICARE-allowable cost method in effect for professional
providers or the [Civilian Health and Medical Program of the Uniformed Services]
(“CHAMPUS”) Maximum Allowable Charge (CMAC).’” Id. (citation omitted). The
TRICARE-allowable cost method “applied until 2009, when TRICARE introduced a new
payment system for hospital outpatient services that was similar to the Medicare [Outpatient
Prospective Payment System (‘OPPS’)] rules.” Id.

         On 23 January 2007, two hospitals “filed their first amended complaint in the [United
States District Court for the District of Delaware] asserting claims for breach of contract implied
in fact and breach of quasi-contract/unjust enrichment” against TRICARE’s
intermediary-managed care support contractors (“intermediaries”). N. Mich. Hosps., Inc., 344 F.
App’x at 735. “The Hospitals alleged [the intermediaries] refused to pay the Hospitals’ facility
charges for certain outpatient services rendered by the Hospitals to TRICARE beneficiaries,
despite the fact that the Hospitals submitted claims to [the intermediaries] which included such
charges.” Id. (footnote omitted). The district court dismissed the complaint because the
hospitals failed to first exhaust their administrative remedies, id. at 739, and the Third Circuit
affirmed. Id. at 740. The Third Circuit determined, “Without question, the regulations state that
certain services are reimbursed based on a maximum allowable charge calculation and that
facility charges, which are not subject to a maximum allowable charge, are paid as billed.” Id. at
737 (citing 32 C.F.R. § 199.14(a)(5)(i)–(xi)). The Third Circuit added “the regulations are
equally clear that the Hospitals are not allowed to simply submit bills for any amount and then
claim that they are entitled to reimbursement for the full amount charged because any amount
above the CMAC represents their ‘facilities’ expenses.” Id. In dicta, the court stated, “The
dispute at issue is not a purely legal one, but rather requires factual determinations such as
whether expenses that qualify as facility charges were incurred, whether such charges were
properly billed, and how much is owed if they were incurred and properly billed.” N. Mich.
Hosps., Inc., 344 F. App’x at 737. “Therefore, what is required by the underlying dispute in this
case is an application of the TRICARE regulations to the Hospitals’ specific claims for
reimbursement.” Id. After the Third Circuit affirmed, “the parties to that suit exchanged email
communications regarding further steps and potential readjustment with TRICARE.” Op. &
Order (“14 Jan. 2020 Op. & Order”) at 3 n.2, ECF No. 125.

        In response to hospital complaints, TRICARE hired Kennell and Associates, a consulting
firm, to “undertake a study [(‘Kennell study’)] of the accuracy of its payments to the hospitals.”
Ingham Reg’l Med. Ctr., 874 F.3d at 1343–44. The Kennell study “compared CMAC payments
to the payments that would have been made using Medicare payment principles, and determined
that DoD ‘(1) underpaid hospitals for outpatient radiology but, (2) correctly paid hospitals for all
other outpatient services.’” Id. at 1344 (emphasis removed).

       From the Kennell study findings, “DoD created a discretionary payment process
[(‘DPP’)],” and, on 25 April 2011, DoD notified hospitals by letter of the process for them to
“request a review of their TRICARE reimbursements (the ‘Letter’).” 2 Id. The DoD also

2
    The Letter states, in pertinent part:

                                                -3-
“published a document titled ‘NOTICE TO HOSPITALS OF POTENTIAL ADJUSTMENT TO
PAST PAYMENTS FOR OUTPATIENT RADIOLOGY SERVICES’ (the ‘Notice’)” on the
TRICARE website. Def.’s MSJ App. at A3–A9 [hereinafter DPP Contract Notice], ECF No.
203-1. 3 Like the Letter, the Notice stated any submission would be treated as “an untimely but
discretionary appeal under 32 CFR 199.10(a)(5) and (c) provided it is received no later than 23
June 2011.” Id. at A7. The Notice also indicated: “Based on the request and subject to the
availability of funds, each hospital will receive adjusted payments in return for acceptance of
DoD’s offer of additional payment based on criteria established by the agency,” and “payment of
the discretionary adjustments will also be conditioned on the execution of a release by the
hospital of any hospital outpatient service claims against the agency, TRICARE beneficiaries
and the TRICARE [intermediaries].” Id. The Notice described a nine-step methodology by
which hospitals could “request an analysis of their claims data for possible discretionary

        For purposes of this process, DoD will treat your submission as an untimely but discretionary appeal
        under 32 Code of Federal Regulations 199.10(a)(5) and (c), provided it is received no later than 60
        days from the date of this letter. Based on the request, your hospital may be paid an adjustment,
        subject to the availability of appropriations, in return for your acceptance of DoD’s offer of
        additional payment based on criteria established by the agency. . . . In order to bring closure to any
        concerns regarding payment of hospital outpatient services under the TRICARE regulation prior to
        implementation of OPPS, payment of the discretionary adjustments will also be contingent on the
        execution of a release by the hospital of any hospital outpatient service claims against the agency,
        TRICARE beneficiaries, and TRICARE [intermediaries]. We value your hospital as a partner in
        this effort and remain committed to working with you to complete the analysis of claims data and
        determine if any additional payments may be allowed.

Def.’s MSJ App. at A1–A2 (DPP Contract Letter), ECF No. 203-1.
3
 The Notice explained in relevant part:

        The TRICARE regulation provisions on hospital outpatient services, in the absence of adoption of
        the Medicare OPPS methodology, adopted comparable Medicare payments for similar services
        provided in other sites (i.e., physician offices). That is, TRICARE looked to the similarity of
        services being provided, not the site of services, in adopting a reimbursement methodology for
        hospital outpatient services. . . .

        [I]n reviewing payments for hospital services, DoD has determined that, for radiology services . . .
        the technical component of the allowable charge did not approximate the Medicare fair payment for
        such hospital services as well as it could have. That is, looking at the Medicare reimbursement
        methodologies in existence prior to adoption of Medicare OPPS in 2000, . . . some radiology services
        were underpaid in comparison. . . . Thus, although payments to hospitals for radiology services
        were consistent with the duly promulgated regulation, there is a basis for TRICARE to provide an
        opportunity to make some discretionary net payment adjustments to approximate more closely
        Medicare payment methods. . . .

        General TRICARE policy is that payment methodologies follow to the extent practicable Medicare
        payments. Prior to adopting [OPPS], Medicare used a blended rate that factored in a percentage of
        hospital costs and a percentage of the global physician fee schedule to reimburse hospital outpatient
        radiology services. In contrast, TRICARE regulation limited reimbursement to hospitals for
        individual outpatient radiology services to the technical component portion of the [CMAC], which
        was one component of Medicare’s physician fee schedule. Consistent with TRICARE policy under
        statute to pay similar to Medicare, we have determined that discretionary adjusted payments may
        better reflect the Medicare payment amounts for outpatient radiology claims.

DPP Contract Notice at A5–A7.

                                                        -4-
adjustment” and to “govern the review of payments for hospital outpatient radiology services and
payment of any discretionary net adjustments.” Id.

        Step 1 instructed hospitals to “submit[] a request for analysis of their claims data for
hospital outpatient department radiology charges” for the period before TRICARE OPPS took
effect. Id. Step 2 in relevant part expounded on submitting claims data, contact information, and
questions. The second step described the process for determining necessary claims data:
“[H]ospital[s] submit[] data with [their] name, address, zip code, Tax ID number, TRICARE
sub ID number, the 6-digit Medicare OSCAR provider number [also known as the provider
identification number], and [National Provider Identification (‘NPI’) number].” Id. Step 2 also
directed hospitals to provide contact names and addresses “to be used by TMA for formal
response to the request.” DPP Contract Notice at A7. Each hospital compiled the required
information in “[a] separate Excel spreadsheet . . . in the TMA-specified format.” Id. Step 2
also specified the method to ask TMA questions noting, “Questions of general interest to all
hospitals will be posted with answers on the TMA website.” DPP Contract Notice at A7; see
Def.’s MSJ App. at A10–A15 [hereinafter DPP Contract FAQs].

         Steps 3–6 disclose how TMA would extract, exclude, and analyze claims data. DPP
Contract Notice at A7–A9. Specifically, Step 3 explained “TMA w[ould] extract the claims for
each hospital for claims for outpatient radiology services during the relevant period.” Id. at A7.
Step 3 also indicated which of the extracted claims TMA would exclude from consideration,
such as “if the [Technical Component (‘TC’)] CMAC amount is less than the global CMAC and
the claim does not have a TC modifier. Id. at A7–A8. Step 4 presented the “‘Medicare’
method” TMA used to “calculate what would have been paid under the approach that Medicare
used to pay hospital outpatient radiology claims prior to [Centers for Medicare & Medicaid
Services (‘CMS’)] implement[ing] . . . the Medicare OPPS in 2000.” Id. at A8. Step 5 detailed
how TMA “adjust[ed] the ‘Medicare’ amount calculated [through the Medicare Method] in Step
4 on each claim using the ratio of the actual allowed amount (the amount that a health plan has
determined to be a fair price for a given medical treatment) on the claim to the TRICARE
Standard allowed amount (the technical component of the CMAC).” Id. Step 6 explained how
TMA “then compare[d] the adjusted ‘Medicare’ amount for each claim with the actual allowed
amounts on that claim” and “calculate[d] the difference between the two amounts.” Id. at A9.
The difference between the Medicare method calculation and the payment from TMA “w[as]
used in determining the level of additional payment to the hospital.” DPP Contract Notice at A9.
If the resulting difference was more or equal to TMA’s payment, “no additional payment shall be
made.” Id. Step 7 clarified “[i]f the calculations in Step 6 [comparing the actual allowed amount
and the Medicare method amount] indicate that an additional payment shall be made to the
hospital, then a hospital-specific offset for cost sharing shall be calculated.” Id.

        Step 8 notified hospitals “[a] written response [at] the hospital’s request w[ould] be sent
to the individual at the address provided by the hospital [and] provide the calculated
discretionary adjusted payment and the calculations from which the adjustment was derived.”
Id. Step 8 added “[w]hile the methodology for calculating the adjustment is not subject to
questions, any questions regarding the data used in the calculations should be received by TMA
within 30 days . . . of TMA’s response . . . . Any questions should be accompanied by detailed

                                                -5-
explanation of the alleged errors and the proposed corrections with supporting documentation.”
Id. at A9; see Def.’s MSJ App. at A16 (DPP Contract Sample Response).

       Finally, Step 9 specified TMA’s written response mentioned in Step 8 included “a release
and agreement to accept the discretionary adjusted payment by the hospital.” DPP Contract
Notice at A9. Per Step 9, “[t]he signed release and agreement should be returned to TMA within
30 days of the date of initial response or TMA response to any questions raised in [S]tep 8,
whichever date is later.” Id. After TMA received “the signed release and agreement, payment
w[ould] be made to the hospital.” Id.

        Plaintiffs estimate several thousand hospitals submitted requests for discretionary
payment, including the six named plaintiffs in this case (“plaintiffs”): McLaren Greater Lansing
(Ingham Regional Medical Center), INTEGRIS Baptist Regional Health Center (Miami),
INTEGRIS Bass Baptist Health Center, INTEGRIS Grove Hospital, INTEGRIS Baptist Medical
Center (Integris Baptist), and INTEGRIS Canadian Valley Hospital. See Ingham Reg’l Med.
Ctr. v United States, 126 Fed. Cl. 1, 16 (2016), aff’d in part, rev’d in part, 874 F.3d at 1348. The
Court previously “determined that plaintiffs in this lawsuit have appropriately pled that a
contract was formed between TMA and plaintiffs through: (1) the April 25, 2011 letter, (2) the
Notice, (3) the FAQs, (4) the spreadsheets that hospitals submitted to TMA to provide their
identifying information and indicate their interest in receiving the adjustment, (5) the payment
adjustment worksheets that TMA provided to hospitals to show the amount of TMA’s proposed
adjustment, and (6) the release of claims that hospitals executed to receive their adjustment
payments (‘the Release’).” Def.’s MSJ at 17 (citing Ingham Reg’l Med. Ctr., 126 Fed. Cl. at
31–32).

       B.      Regulatory Scheme

       The relevant provisions of the regulatory scheme of 32 C.F.R. § 199.14(a)(5) provide:

       (5) Hospital outpatient services. This paragraph (a)(5) identifies and clarifies
       payment methods for certain outpatient services, including emergency services,
       provided by hospitals . . . .

       (iv) Radiology services. TRICARE payments for hospital outpatient radiology
       services are based on the allowable charge method under paragraph (j)(1) of the
       section. In the case of radiology services for which the CMAC rates are established
       under that paragraph, a payment rate for the technical component of the radiology
       services is provided. Hospital charges for an outpatient radiology service are
       reimbursed using the CMAC technical component rate. . . .

       (xi) Facility charges. TRICARE payments for hospital outpatient facility charges
       that would include the overhead costs of providing the outpatient service would be
       paid as billed. For the definition of facility charge, see § 199.2(b).

       C.      Procedural History

                                               -6-
       On 21 October 2013, plaintiffs brought this action claiming the government underpaid
them for certain outpatient medical services they provided between 1 August 2003 and 1 May
2009. See Ingham Reg’l Med. Ctr., 126 Fed. Cl. at 9. Plaintiffs allege the approximately six
years of underpayment breached two contracts and violated various statutory and regulatory
provisions. Id. Plaintiffs seek to represent a class of approximately 1,610 similarly situated
hospitals. See Pls.’ Mot. to Certify, ECF No. 76.

         On 13 January 2015, the government filed a motion to dismiss plaintiffs’ complaint for
failure to state a claim pursuant to Rule 12(b)(6) of the Rules of the United States Court of
Federal Claims (“RCFC”), Def.’s Mot. to Dismiss, ECF No. 41. The government argued
plaintiffs “fail[ed] to allege facts” sufficient to establish a binding contract with the government
or that any contract was breached, and absent a valid contract, “there [could] be no mutual
mistake or breach of the covenant of good faith and fair dealing.” Id. at 1. On 22 March 2016,
this Court dismissed plaintiffs’ complaint for failure to state a claim. See Ingham Reg’l Med.
Ctr., 874 F.3d at 1346. Plaintiffs appealed three claims: the “(1) breach of express contract
between Ingham and DoD based on the [DPP]; (2) revision of Ingham’s contract based on
mutual mistake, in light of the errors in the calculations of radiology outpatient services and the
Kennell study; and (3) violations of money-mandating statutes and regulations.” Id. On 3
November 2017, the Federal Circuit “reverse[d] the dismissal of [plaintiff] Ingham’s breach of
contract claim, affirm[ed] the dismissal of [plaintiffs’] money-mandating claim, and [did] not
reach the claim for mutual mistake.” Id. at 1348. Although the Federal Circuit found the
Release does not bar Ingham from bringing a breach of contract claim, it did not further interpret
the contract. See id. at 1346. The Federal Circuit remanded the case “for further proceedings on
the breach of contract claim.” Id. at 1348. On remand, plaintiffs filed an amended complaint,
the government filed its answer, and the parties engaged in discovery, ECF Nos. 74, 79. This
case was transferred to the undersigned Judge on 29 July 2019. See Order, ECF No. 114.

        On 14 January 2020, the Court issued an order ruling on five motions regarding the
government’s effort to “claw back” purportedly privileged documents it inadvertently sent
plaintiffs. 14 Jan. 2020 Op. & Order. The Court held these communications were not privileged
by analogizing the DPP to “an insurer’s claim investigation” as “DoD investigated hospitals’
underpayment claims further before making a payment determination.” Id. at 18. The Court
stated, “When [one of the allegedly privileged documents] was created, the government’s
primary focus was the calculation, and recalculation, of TRICARE payments which became the
government’s business during the [DPP].” Id. at 22. “While there may have been
communication exchange between the parties regarding ‘settlement’ after the Notice, the
comments were related to calculation review regarding repayment” and the parties aimed to
“avoid litigation.” Id. at 19, 21. The Court found “the term ‘settlement’ in this context refers to
a negotiated business settlement, not the settlement of a legal action, because the government
sought to correct payment errors and avoid litigation.” Id. at 20. The Court thus held the
documents in question could not “constitute preparation for litigation,” and the DPP Contract
was a “negotiated business settlement to agree on a recalculation figure.” Id. at 20, 22.

       On 5 June 2020, plaintiffs filed a renewed motion to certify class and appoint class
counsel (“Pls.’ Class Cert.”), ECF No. 146. The government filed a response to plaintiffs’
renewed motion for class certification on 26 August 2021 (“Def.’s Class Cert. Resp.”), ECF No.

                                                -7-
207, and on 4 February 2022, plaintiffs filed a reply in support of their renewed motion to certify
class action and appoint counsel, (“Pls.’ Class Cert. Reply”), ECF No. 226. On 26 August 2021,
the government filed a motion for summary judgment (“Def.’s MSJ”), ECF No. 203. Plaintiffs
filed an opposition to government’s motion for summary judgment on 4 February 2022 (“Pls.’
MSJ Resp.”), ECF No. 225, and on 11 March 2022, the government filed a reply in support of its
motion for summary judgment (“Def.’s MSJ Reply”), ECF No. 234.

        The parties then filed seven evidentiary motions and one motion for leave to file amended
briefs. On 26 August 2021, the government filed a motion to exclude inadmissible evidence
relied upon in plaintiffs’ motion for class certification, ECF No. 204, under Rule 408 of the
Federal Rules of Evidence (“FRE”). The same day, the government filed a motion to exclude the
expert opinion of Jane Jerzak, ECF No. 205, and a motion to exclude the expert opinion of
Anthony Fay, EFC No. 206. On 11 March 2022, the government filed a motion to strike
inadmissible evidence under FRE 408 relied upon in plaintiffs’ response to the government’s
motion for summary judgment and plaintiffs’ response to the government’s motion to exclude
the expert opinion of Jane Jerzak, ECF No. 238. The next day, the government moved to strike
paragraphs 7 and 18 of the declaration of Sere Allen, ECF No. 239. On 14 March 2022, the
government moved to strike paragraphs 3 through 10 of Dale Thompson’s declaration, ECF No.
240. The next day, plaintiffs filed a motion for leave to file amended briefs and appendices, ECF
No. 242. On 5 April 2022, plaintiffs filed a motion to exclude the expert opinion and continued
participation of David L. Kennell and Kennell and Associates, ECF No. 251. 4 The Court
considers plaintiffs’ amended briefs and appendices, ECF No. 242, to the extent they are relevant
to this Opinion and Order.

         D.       Scope of Questions Presently at Issue

        The Court held a status conference on 11 May 2022 to discuss at length all ten motions
pending before the Court, ECF No. 241. The Court discussed whether there were material
disputes of fact to preclude summary judgment and whether the Court should resolve the
government’s summary judgment motion with plaintiffs’ motion for class certification. 11 May
2022 Status Conference Tr. (“SC Tr.”) at 6:23–7:2, ECF No. 257. All parties agreed “the
interpretation of the contract . . . and [the] interpretation of 32 C.F.R. § 199.14 [are] question[s]
of law,” and decisions in conjunction with class certification would be “a great benefit to clarity
in the case and a preservation of resources” if adverse to plaintiffs. SC Tr. at 116:12–19. At the
parties’ request, the Court also considered whether mediation might be appropriate. SC Tr. at
7:3–4. Plaintiffs preferred mediation, but the government opposed mediation at the time. See
SC Tr. at 112:17–114:23. The parties discussed their various evidentiary motions and motion for
leave to file—specifically the materiality of each motion to the government’s motion for
summary judgment and plaintiffs’ motion for class certification. SC Tr. at 7:5–8.

        During oral argument on 9 June 2022, both parties confirmed there are no disputes of
material fact on the issues of: (1) TMA’s duties under the contract; and (2) whether there was a
mutual mistake of fact. 9 June 2022 Oral Argument Tr. (“Tr.”) at 78:11–19, ECF No. 259. The
parties also agreed their various pending evidentiary motions are not necessary to resolve the two

4
  The parties also filed response and reply briefs in opposition to these motions and in support of these motions,
respectively. See ECF Nos. 212, 220, 223, 243, 244, 245, 247, 248, 250, 252, and 253.

                                                         -8-
summary judgment issues: (1) contract interpretation; and (2) class certification. Tr. at
78:20–79:4. Thus, the 9 June 2022 oral argument and this opinion and order do not contemplate
the parties’ evidentiary motions, as the motions to exclude expert opinions, ECF. Nos. 205, 206,
and 251, and strike certain portions from certain filings, ECF Nos. 238, 239, and 240, are
contingent upon the Court determining the appropriate interpretation of the DPP Contract. SC
Tr. at 122:13–16 (THE COURT: “[W]e proceed to summary judgment on the two items
generally described as . . . CFR 32-199 and the clarification of what’s released as part of the
DPP, as well as class certification[.]”). In turn, the Court assesses: (1) the extent of TMA’s
contractual duties under the DPP; and (2) the availability of the defense of mistake regarding 32
CFR 199.14(a)(5)’s CHAMPUS discount rates. See Tr. 77:6–14 (THE COURT: “Issue 1, if the
Court finds that the government only had a duty to use the data that it had, that plaintiffs did not
know about, in order to plug into the DPP, and that they did that, and then on Issue 2, the Court
finds that there was no mistake with respect to 32 CFR 199.14(a)(5), what issues still remain in
the case? [PLAINTIFFS]: I don’t think there would be issues remaining[.]”).

II.    Parties’ Arguments on the Government’s Motion for Summary Judgment

         The government argues plaintiffs’ breach of contract claim fails as a matter of law
“because the parties’ contract assigned the ultimate responsibility for identifying any errors in
the adjustment calculation to the plaintiffs, and provided them a hard and fast 30-day deadline for
doing so.” Def.’s MSJ at 31. For plaintiffs’ mutual mistake of fact claim, the government
argues “there is no mistake to begin with.” Id. at 32. The government adds “plaintiffs bear the
risk of the mistakes that they now allege, and . . . the reformation that they seek is legally
unavailable because TMA specifically explained in the parties’ contract that it was not offering
any such adjustment.” Id.

         Plaintiffs argue the “Government is liable to Plaintiffs on the following two bases: (1)
the Government breached the DPP by failing to properly extract and adjust all of Plaintiffs’
radiology claims[;] and (2) the Parties committed a mutual mistake of fact upon entering the DPP
by believing that the Government had properly reimbursed Plaintiffs for all categories of
outpatient services (except for radiology), including by appropriately paying for facility
charges.” Pls.’ MSJ Resp. at 17. “First, as to the Plaintiffs’ breach of contract claim, the plain
language of the DPP shows that the Government breached what was a clear contractual duty to
extract and adjust all of the Plaintiffs’ radiology claims.” Id. at 18. “Second, as to the Plaintiffs’
claim for mutual mistake, the plain language of § 199.14(a)(5) shows that the Government must
reimburse hospitals for the overhead costs of providing outpatient services, as billed, including
for all facility charges.” Id.

III.   Summary Judgment Standard

         Summary judgment is proper when the evidence fails to reveal a “genuine issue as to any
material fact and that the moving party is entitled to a judgment as a matter of law.” Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 247 (1986). “Genuine” issues exist if “the evidence is such
that a reasonable jury could return a verdict for the nonmoving party.” Id. at 248. Facts are
“material” if they “might affect the outcome of the suit” and do not include “irrelevant or
unnecessary” factual disputes. Id. Inferences “must be viewed in the light most favorable” to

                                                -9-
the nonmoving party when considering summary judgment. Matsushita Elec. Indus. Co. v.
Zenith Radio Corp., 475 U.S. 574, 587 (1986). The moving party “always bears the initial
responsibility” of presenting evidence which “demonstrate[s] the absence of a genuine issue of
material fact.” Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). If this burden is met, the
nonmovant must “set forth specific facts showing that there is a genuine issue for trial.”
Anderson, 477 U.S. at 256.

IV.     Analysis of Plaintiffs’ Breach of Contract Claim

        The government argues: (1) TMA had no contractual duty to extract, analyze, and adjust
radiology claims data from the hospitals 5 under the contract; and (2) plaintiffs bore the risk of
any data discrepancy. See generally Def.’s MSJ. The government asserts plaintiffs’ breach of
contract claim “fails as a matter of law . . . because the parties’ contract assigned the ultimate
responsibility for identifying any errors in the adjustment calculation to the plaintiffs, and
provided them a hard and fast 30-day deadline for doing so.” Id. at 31. The government states,
“[t]he contract provided that TMA would first extract data with certain contractually-specified
identifiers from its own records, and use the methodology specified in the parties’ contract to
generate a proposed adjustment amount[.]” Id. (citing DPP Contract Notice at A7–A8). Then,
“once TMA presented this proposed adjustment amount to the hospitals, the hospitals were
required to raise ‘any questions regarding the data used in the calculations’ and provide a
‘detailed explanation of the alleged errors and the proposed corrections with supporting
documentation’ within 30 days.” Id. (citing DPP Contract Notice at A8). The government adds
plaintiffs “received years ago exactly what they bargained for, i.e., a quick payment of a definite
adjustment amount that they accepted with full knowledge that they had not examined the
provenance of that number using their own data, and, accordingly, with full acceptance of any
associated risk.” Id.

        Plaintiffs argue: (1) TMA had a contractual duty to extract, analyze, and adjust plaintiffs’
radiology claims data under the contract; (2) TMA had a duty to extract line items from its
database; and (3) TMA bore the risk of any data discrepancy, not plaintiffs. See generally Pls.’
MSJ Resp. Plaintiffs add “[t]he Government’s attempt to shirk its contractual duty fails as (a)
the evidence proves that the Government breached the DPP, (b) the Government was responsible
for ensuring the accuracy of its data, not Plaintiffs, and (c) the Government cannot prove any
affirmative defense, as is required, to avoid liability.” Id. at 23.

5
  The Court refers to the data not in TMA’s records as “hospital” data because plaintiffs’ mention of “all of the
radiology line items,” Pls.’ MSJ Resp. at 27, relates to their argument TMA’s databases were missing certain records
which the hospitals submitted. See id. at 30 (“The Government does not explain why some of the data did not exist
in its systems . . . .”); see also Tr. at 101:7–102:3 (“THE COURT: . . . Plaintiffs read [Step 3 as stating] TMA will
extract the claims for each hospital’s submitted claims for outpatient radiology services? [PLAINTIFFS]: I think
that’s the only way to fairly interpret that language . . .” (emphasis added)). As a factual matter, the government
admits records were missing from TMA’s database, but the government contends it was not required under the
contract to find additional data as a legal matter. Tr. at 13:14–22 (“[THE GOVERNMENT:] . . . [W]e discovered
that there were 139 line items in the INTEGRIS data set that TMA could not find in its records. So, . . . the
INTEGRIS data set does contain records that are missing from ours. I don’t think that changes our legal position on
the motion for summary judgment . . . because . . . there is no contract requirement for us to adjust records that we
don’t own because the contract’s cast in terms of extraction.”).

                                                       - 10 -
        There are four elements to a breach of contract claim: “(1) a valid contract between the
parties, (2) an obligation or duty arising out of the contract, (3) a breach of that duty, and (4)
damages caused by the breach.” San Carlos Irrigation & Drainage Dist. v. United States, 877
F.2d 957, 959 (Fed. Cir. 1989) (citations omitted). For the first element, the court previously
found “a valid contract between the parties,” and the parties do not dispute this finding. Ingham
Reg. Med. Ctr., 126 Fed. Cl. at 22, 31–32 (2016), aff’d in part, rev’d in part on other grounds,
874 F.3d 1341 (Fed. Cir. 2017); Def.’s MSJ at 17; Pls.’ MSJ Resp. at 13; see San Carlos
Irrigation & Drainage Dist., 877 F.2d at 959; Def.’s MSJ App. at A1–A2 [hereinafter DPP
Contract Letter]; DPP Contract Notice at A3–A9; DPP Contract FAQs at A10–A15; Def.’s MSJ
App. at A17 [hereinafter DPP Contract Release]. The Court accordingly considers: (1) whether
the contract obligates TMA as plaintiffs allege; (2) if TMA had contractual duties, whether it
breached those duties; (3) if TMA breached, whether any breach caused plaintiffs’ damage; and
(4) whether the government proves any viable defenses to plaintiffs’ breach of contract claim.
See San Carlos Irrigation & Drainage Dist., 877 F.2d at 959.

         A.       Whether TMA Had a Contractual Duty to Extract, Analyze, and Adjust
                  Hospital Radiology Data

        The government concedes the DPP required TMA to fulfill certain contractual
obligations it owed to plaintiffs. Def.’s MSJ at 34 (noting “TMA’s duties toward the plaintiffs”).
To determine the extent of the obligations, the Court looks to the DPP’s plain language and gives
the words their plain and ordinary meaning, unless the language is ambiguous. See United
Cmtys., LLC v. United States, 154 Fed. Cl. 676, 681 (2021). The Court first narrows the contract
provisions to plaintiffs’ radiology data before then determining its ambiguity (or lack thereof)
and analyzing the plain meaning of the DPP language.

        Missing data is the central problem to the issue of what data the government had a duty to
correctly adjust. Between hospitals submitting their claims data to intermediaries, intermediaries
processing the data and submitting it to TMA, and TMA storing the data in its database, some
claims data was miscategorized or lost. For example, eighty-two line items from
plaintiff-Ingham were all together missing from TMA’s database. Some of the data loss was due
to programming errors and records conversion issues with intermediaries between 2003 and 2009
after original submission, but the extent, timing, and exact causes of the loss are unknown.
Plaintiffs’ expert report did not opine regarding how much data was missing. 6 The question the
Court addresses now is whether the government had a duty to find and correct this missing data

6
  This explanation is based on the parties’ statements at oral argument. See Tr. at 12:7–11 (“[THE
GOVERNMENT]: . . . Plaintiffs, because of the way they structured their expert report, did not actually address
that issue specifically, trying to quantify or identify why line items may have been missing or anything to that
effect.”), 50:12–15 (“THE COURT: . . . [W]hen we were just talking about Ingham as an example, there were 82
that were missing? [THE GOVERNMENT]: Yes.”), 50:23–51:4 (“[THE GOVERNMENT]: . . . [H]ow this
particular error manifested itself was the hospital would appropriately code it. It would be a CPT code for an x-ray
of your arm. It would forward that information to the fiscal intermediary. There’s some crazy data cross-walking
problem on the part of Healthnet that—a programming error which caused those CPT codes to be rerecorded as
generic codes.”), 74:9–16 (“[PLAINTIFFS]: . . . [I]t’s not part of our interpretation that there has to be a
reevaluation of the hospital’s claims, just that the thing that is being extracted is the hospital’s claim and not
something that the government or its fiscal intermediaries . . . have changed in some way that’s unknown to
plaintiff[s].”), 257:19–24 (“[THE GOVERNMENT]: . . . [T]he issue is that the fiscal intermediary doesn’t have
those claims. Right? There was a records conversion issue, and so . . . . I don’t know that we still have them.”).

                                                       - 11 -
under the DPP, or whether the government could re-calculate the payments under the DPP
utilizing the data as it existed in 2011 in the government’s possession.

        The government argues, “Plaintiffs fail to cite any provision of their contracts that
contain” an explicit duty for the government to extract and adjust the hospitals’ radiology data.
Def.’s MSJ Reply at 6. The government adds, “TMA had no obligation to adjust line items that
were not in its physical possession.” Tr. at 12:3–5. In response, plaintiffs argue “the plain
language of the DPP shows that the Government breached what was a clear contractual duty to
extract and adjust all of the Plaintiffs’ radiology claims.” Pls.’ MSJ Resp. at 18. Plaintiffs assert
“the Government itself concedes that it did not follow the methodology in the DPP under which
the Government expressly promised that it would extract and adjust all of the radiology line
items.” Id. at 27. To support the contention the DPP required TMA “to extract, analyze, and
adjust all of Plaintiffs’ radiology claims data,” plaintiffs cite several contractual provisions,
including: the Letter; Step 1; Step 3; Step 4; Step 5; Step 6; Step 7; FAQ 2; and FAQ 14. Id. at
24–28. Plaintiffs assert “[i]t would be unreasonable to expect a hospital reading the plain
language of the DPP to infer that only some of the required claims would be included.” Id. at 28.
The original hospital submissions comprise “all” of plaintiffs’ radiology claims. See Tr. at
74:9–16 (“[PLAINTIFFS]: . . . [I]t’s not part of our interpretation that there has to be a
reevaluation of the hospital’s claims, just that the thing that is being extracted is the hospital’s
claim and not something that the government or its fiscal intermediaries . . . have changed in
some way that’s unknown to plaintiff[s].”)

       Contract interpretation is a question of law. 7 See Jowett, Inc. v. United States, 234 F.3d
1365, 1367–68 (Fed. Cir. 2000). The court “must interpret the contract in a manner that gives
meaning to all of its provisions and makes sense.” Id. at 1368 (quoting McAbee Constr., Inc. v.
United States, 97 F.3d 1431, 1435 (Fed. Cir. 1996)). Beginning with the “plain language,” the
court must “give the words of the agreement their ordinary meaning unless the parties mutually
intended and agreed to an alternative meaning.” Id. (first quoting McAbee Constr., Inc., 97 F.3d
at 1435, and then quoting Harris v. Dep’t of Veterans Affairs, 142 F.3d 1463, 1467 (Fed. Cir.
1998)). The court must also determine “the intent of the parties at the time they contracted, as
evidenced by the contract itself.” Greco v. Dep’t of the Army, 852 F.2d 558, 560 (Fed. Cir.
1988). If multiple interpretations of contract provisions exist, they “should be construed most
strongly against the drafter.” United States v. Seckinger, 397 U.S. 203, 210 (1970).

        As a threshold matter, both parties agree the relevant contract language is unambiguous,
though they disagree as to the interpretation. See Tr. at 72:24–25 (“[PLAINTIFFS]: . . . We
don’t think there’s an ambiguity.”); 103:13–14 (“[PLAINTIFFS]: . . . I don’t necessarily allege
that Step 3 is ambiguous.”); Def.’s MSJ Reply at 1 (“In our opening brief, we demonstrated that
the contracts . . . are simple, straightforward, and fundamentally unambiguous instruments.”).
As the parties agree the contract is unambiguous, the Court now considers the various terms as
they relate to TMA’s duties under the contract. First, the Court assesses the role of
intermediaries who were “made aware of th[e] DoD initiative [to calculate the net adjustments

7
 As the nonmovant, plaintiffs agree “interpreting [TMA’s] contractual duties is purely an issue of law.” Tr. at
72:21–23. The Court accordingly need not determine whether the evidence reveals a “genuine issue as to any
material fact” and must only consider whether the government “is entitled to judgment as a matter of law.”
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247 (1986).

                                                       - 12 -
itself], but [would] not otherwise be involved in the calculation of net adjustments.” DPP
Contract Letter at A1. The Court then analyzes TMA’s obligations in Step 1 instructing
hospitals to “submit a request for analysis of their claims data” and in Step 2 directing hospitals
to enter basic identifying information in a provided Excel spreadsheet as part of the Step-1
request. DPP Contract Notice at A7. In Step 3, the Court reviews whether “TMA extract[ing]
the claims for each hospital for claims for outpatient radiology services” provided in the Excel
spreadsheet requires TMA to consider data not included in the spreadsheet. Id. at A7–A8. Next,
the Court must determine if “each” qualifying “hospital” or “claim” throughout the CHAMPUS
methodology—as well as FAQ 14, which clarifies the DPP analysis was performed on a service
line basis—requires TMA to examine all plaintiffs’ radiology data in the aggregate or just
claims-level data individually. Id. at A5–A7; DPP Contract FAQs at A12. If the Court
determines the DPP Contract obligates TMA to inspect the hospitals’ data as opposed to just
claims data in TMA’s database, the Court must determine whether TMA had a contractual duty
to verify its data.

         The government first argues regardless of how the steps are calculated in the
methodology, the government only has the data previously provided by intermediaries. See
Def.’s MSJ at 38 (“It was important that individual hospitals provide complete identifying
information that TMA did not have in order to establish the unique, agreed-upon parameters of
TMA’s records search for that hospital.”). The Letter provides: “Because this issue affects all
three TRICARE regions and multiple years of claimed services, DoD has decided to calculate
the net adjustments itself, rather than through the [intermediaries], which have been made aware
of this DoD initiative, but will not otherwise be involved in the calculation of net
adjustments . . . .” DPP Contract Letter at A1. Plaintiffs contend the plain language of the DPP
explicitly required TMA to extract all the radiology claim data, including data from the hospitals
not in the database, and to examine its data for errors. Pls.’ MSJ Resp. at 23. To argue the
government was obligated to analyze the hospitals’ radiology data, plaintiffs emphasize “DoD
has decided to calculate the net adjustments itself.” Id. at 25 (emphasis removed) (quoting DPP
Contract Letter at A1). Plaintiffs argue in TMA claiming it would calculate the net adjustments
itself, “[t]he government impliedly warrant[ed] the accuracy of matters set forth in contract
documents.” Id. at 23–24 (citing D.F.K. Enters., Inc. v. United States, 45 Fed. Cl. 280, 285
(1999)).

        To illustrate the differences in language and meaning between the Letter and plaintiffs’
interpretation, the Court first reads the Letter through the lens of plaintiffs’ interpretation.
Plaintiffs’ interpretation of the Letter to input “the hospitals’ data” within the calculations
essentially requires adding the words “with the hospitals’ data” to read “DoD has decided to
calculate the net adjustments itself with the hospitals’ data.” See DPP Contract Letter at A1. As
can be seen from considering the additional limitation, the inclusion of the additional words
expands the scope of the obligation on the government. The plain meaning of the original
sentence from the Letter—“DoD has decided to calculate the net adjustments itself, rather than
through the [intermediaries]”—is TMA would not involve intermediaries in the DPP calculation
process or use the hospitals’ data from the intermediaries. Id.; see also Tr. at 106:3–11 (“[THE
GOVERNMENT]: If the [intermediarie]s are not going to be involved with this process, they
are the repository of the plaintiffs’ submitted hospital data. So . . . we are clearly signaling that
we are not going back to the clearinghouse, we are not going back to the hospital data. That

                                                - 13 -
leaves the only thing to be extracted would be the records in the government’s official record of
payment in Step 3.”). This original sentence from the Letter does not provide TMA would
analyze plaintiffs’ data by performing the analysis itself—in fact, the provision lacks any
mention of data, plaintiffs’ or otherwise. DPP Contract Letter at A1. The Court cannot change
the plain meaning of the Letter by adding language. See Antonin Scalia & Bryan A. Garner,
Reading Law: The Interpretation of Legal Texts 174 (2012) (“[I]t is no more the court’s function
to revise by subtraction than by addition.”). The Court finds plaintiffs’ interpretation
inapplicable because the interpretation requires the addition of words to support plaintiffs’
preferred meaning. See id.

        As part of the DPP, DoD further clarified the decision not to use intermediaries in the
DPP was made for administrative efficiency. See DPP Contract Letter at A1. Intermediaries
were not involved “[b]ecause this issue affects all three TRICARE regions and multiple years of
claimed services[.]” Id. This explanation further put plaintiffs on notice TMA planned to
process its data itself to perform the adjustments rather than expending time and resources
involving numerous outside parties or finding the hospitals’ data to process. The plain meaning
of the Letter undermines plaintiffs’ argument the government had to analyze the hospitals’ data.
See Jowett, Inc., 234 F.3d at 1368 (quoting McAbee Constr., Inc., 97 F.3d at 1435); DPP
Contract Letter at A1.

        It is also important to understand the calculation outcome is dependent on which data is
processed. While the government describes a DPP calculation, plaintiffs confuse the described
calculation with a calculation outcome which requires utilizing the hospitals’ data. The Letter
clarifies TMA is only extracting, analyzing, and adjusting the data previously furnished by
intermediaries—and the Letter clarifies only TMA is doing so. See DPP Contract Letter at A1
(“DoD has decided to calculate the net adjustments itself, rather than through the
[intermediaries] . . . .”). Plaintiffs seemingly infer from the government’s responsibility to
perform calculations a promise the calculations will be perfectly accurate and use the hospitals’
data to achieve that perfection: “DoD has decided to calculate the net adjustments itself, rather
than through the [intermediaries],” DPP Contract Letter at A1, according to plaintiffs is
“unambiguous, and make[s] clear that the duty to extract, analyze, and adjust all of Plaintiffs’
radiology claims data were [sic] not discretionary tasks, and rested solely with the Government.”
Pls.’ MSJ Resp. at 26 (emphasis added). The cited sentence of the Letter references who is
involved in the payment process—DoD, not intermediaries—rather than what is involved in the
payment process. See DPP Contract Letter at A1. Plaintiffs read in a nonexistent warranty
regarding the process by asserting the government, as sole arbiter of the calculations, must utilize
the hospitals’ data. See id. The plain language does no more than exclude intermediaries from
the process. See Jowett, Inc., 234 F.3d at 1368 (quoting McAbee Constr., Inc., 97 F.3d at 1435);
DPP Contract Letter at A1.

        In summary, the Court does not read the government’s statement intermediaries would
not be involved in DPP calculations as making a promise to adjust specific data. The language
of the Letter refers only to the involvement of intermediaries—or lack thereof—in the DPP
process and does not imply a guarantee of perfect calculations using the hospitals’ data. The
plain meaning of the Letter does not bind the government to analyze the hospitals’ data but rather

                                               - 14 -
clarifies intermediaries would not be involved for efficiency’s sake. See Jowett, Inc., 234 F.3d at
1368 (quoting McAbee Constr., Inc., 97 F.3d at 1435); DPP Contract Letter at A1.

               1.     Whether Step 1 and 2’s Plain Meaning Instructing Hospitals to
                      “submit[] a request for analysis of their claims data” Obligates TMA
                      to Any Performance

        As part of the DPP, the 2-page Letter made hospitals aware more detailed procedures
would follow. The Letter stated “[d]etailed instructions will be posted on the [TMA] Web Site”
and noted these instructions would “explain[] the manner in which a hospital may request th[eir]
claims data be reviewed for appropriate discretionary adjusted payments.” DPP Contract Letter
at A1. These instructions were the Notice and “answers to certain Frequently Asked Questions
(DPP Contract FAQs).” Def.’s MSJ at 11 (citing DPP Contract Notice & FAQs at A3–A15).
Rather than detailing the methodology or defining the extent of data TMA would use, the Letter
directs the hospitals to the 7-page Notice and 20-question FAQs. Extrinsic evidence cannot
change the plain meaning of a writing, but meaning can almost never be plain except in context.
Restatement (Second) Contracts cmt. b (Am. L. Inst. 1981). Contextualizing the Letter with the
Notice and FAQs “gives meaning to all . . . provisions and makes sense[,]” allowing the Letter to
be read as a whole. See Jowett, Inc., 234 F.3d at 1368 (quoting McAbee Constr., Inc., 97 F.3d at
1435). The Court accordingly next addresses the Notice and FAQs.

       Steps 1 and 2 of the Notice outlined the process for requesting analysis of claims data:

       Step 1: Hospital submits a request for analysis of their claims data (process defined
       in Step 2) for hospital outpatient department radiology charges during the period
       from August 1, 2003, to April 30, 2009, which is the last day before TRICARE’s
       OPPS became effective on May l, 2009. Small rural hospitals not subject to
       TRICARE’s OPPS until January 1, 2010, shall submit a request for the August 1,
       2003-December 31, 2009 period. Critical Access Hospitals (CAHs) are not subject
       to TRICARE’s OPPS and shall submit a request for the August 1, 2003-November
       30, 2009 period. As of December 1, 2010, CAHs are reimbursed 101 percent of
       reasonable costs. Hospitals not subject to OPPS (such as Cancer and Children’s
       hospitals) shall submit a request for the August 1, 2003-December 31, 2010 period.

       Step 2: As part of the request, hospital submits data with its name, address, zip
       code, Tax ID number, TRICARE sub ID number, the 6-digit Medicare OSCAR
       provider number, and NPI number. If multiple Tax ID or Medicare provider
       numbers were used during this period, hospitals will submit these data. The request
       shall also include the name and address to be used by TMA for formal response to
       the request. A separate Excel spreadsheet must be completed for each hospital in
       the TMA-specified format. An example is posted on the TMA website . . . .
       Hospitals will also submit the name of a contact and a phone number to resolve any
       questions. The request will be submitted to the following address: [omitted]. Any
       questions should be submitted to the following email address: [omitted]. Questions
       of general interest to all hospitals will be posted with answers on the TMA website.

                                              - 15 -
DPP Notice at A7. Plaintiffs argue Step 1 of the Notice “provides the hospital submit[] a request
for analysis of their claims data,” and plaintiffs noted Step 1 “is at the very beginning of the
hierarchy.” Tr. at 127:16–24. Step 1 required hospitals to submit a request to begin the DPP and
provided the relevant time period of adjustable claims depending on the type of hospital. The
plain meaning of Step 1 provided hospitals initiate the “analysis” by “submit[ting] a request”;
hospitals are the subject of Step 1, and the provision does not obligate TMA to any performance.
DPP Contract Notice at A7. The FAQs expressly foreclose plaintiffs’ argument TMA should
have provided its granular data to the hospitals. See DPP Contract FAQs at A11 (“Claims-level
detail will not be provided due to the number of adjustments over this 7-year period.”). TMA is
simply the passive recipient of the information per Step 1. FAQ 18 also explained three reasons
why “the government will not provide individual claims data to each hospital:” (1) providing 10
million claims of data is impractical; (2) including patient-level data is inadvisable due to privacy
concerns; and (3) giving hospitals the summary worksheet is sufficient for hospitals to determine
whether the historical claims counts and amounts are reasonable. DPP Contract FAQs at A14.
Plaintiffs, therefore, knew before they entered the contract through parallel provisions (Step 1,
FAQ 11, and FAQ 18) TMA was not providing its claim-level data. DPP Contract Notice at A7;
DPP Contract FAQs at A11, A14. Although the provision noted, the “hospital submits a request
for analysis of their claims data[,]” where “their” referred to hospitals, the provision directed
hospitals to Step 2 for how to “submit[] a request for analysis of their claims data.” DPP
Contract Notice at A7. As Step 1 directed the parties to Step 2, the Court next considers whether
the “process defined in Step 2” obligated TMA to extract, analyze, and adjust the hospitals’
radiology data. See id.

        Plaintiffs state Step 2 “requested Plaintiffs to provide . . . basic [identifying] information
in an Excel spreadsheet.” Pls.’ MSJ Resp. at 33. Step 2 provided “[a]s part of the [Step 1]
request, hospital submits data with its name, address, zip code, Tax ID number, TRICARE sub
ID number, the 6-digit Medicare OSCAR provider number, and NPI number.” DPP Contract
Notice at A7. Hospitals “shall also include” a contact name and address for correspondence
related to the Step 9 “formal response.” Id. The requested information qualifies as “basic
[identifying]” data, not claims-level data—billing codes that healthcare entities submit to
insurance companies—or patient-level data—patients’ personal information, such as medical
history and demographic characteristics. See id. The government argues, “[a]t most, plaintiffs
seek to infer a promise or warranty that the data that [TMA] was using was perfect from the fact
that [TMA] did not invite hospitals to submit patient-level data as part of Step 2.” Def.’s MSJ at
39; see also Tr. at 68:16–21 (“THE COURT: . . . [T]he DPP does not warranty proper data
going into it and does not warranty that the data going into it, for the purposes of DPP analysis,
is the same as the data that the hospitals had originally submitted to the intermediary. [THE
GOVERNMENT]: That’s correct.”). The contextual evidence of Step 1, which only calls
hospitals to action, renders similar conclusions. Step 2 is an extension of Step 1, as Step 1
mentioned a “[h]ospital submits a request for analysis of their claims data (process defined in
Step 2)[.]” DPP Contract Notice at A7. Like Step 1, the plain language of Step 2 only described
information for plaintiffs—it does not obligate TMA in any way. See id. Step 2 also limited the
information plaintiffs would submit “[a]s part of the request.” Id. Notably, under Step 2,
hospitals were not invited or required to submit claims data—only basic identifying information.
See id. FAQs 1 and 2 from the TMA website together state the limited information needed from
hospitals more expressly. FAQ 1 clarified hospitals are not required to submit sub-ID numbers.

                                                - 16 -
DPP Contract FAQs at A10. FAQ 2 then built on FAQ 1 by answering the question, “Will I
need to provide further information such as claims-level data or identify the relevant claims or
patients?” Id. TMA answered: “No, you will not. TRICARE will do this. You need to submit
only the information in the Excel sheet [according to Step 2]. Do not submit patient-level data.”
Id. The instructions of Step 2 limited who could submit data and further limited submitted data
to a hospital’s “name, address, zip code, Tax ID number, TRICARE sub ID number, the 6-digit
Medicare OSCAR provider number, and NPI number.” DPP Contract Notice at A7. Step 2 does
not obligate TMA to any action—let alone to analyze data not submitted. Step 1, Step 2, FAQ 1,
and FAQ 2 accordingly specify what the hospitals needed to submit with a request and what they
did not, but the plain meaning of these provisions does not bind the government to analyze the
hospitals’ radiology data. See Jowett, Inc., 234 F.3d at 1368 (quoting McAbee Constr., Inc., 97
F.3d at 1435); DPP Contract Notice at A7; DPP Contract FAQs at A10.

               2.     Whether Step 3 Requires TMA to Reference External Data Sources

       Step 3 of the Notice included the first mention of an action by TMA:

       Step 3: TMA will extract the claims for each hospital for claims for outpatient
       radiology services during the relevant period (either the August 2003-April 2009,
       August 2003-December 2009, or August 2003-November 2010 period). All
       hospital outpatient department claims for radiology paid as billed, with OHI, or
       with a professional modifier (-26) will be excluded. Radiology claims will include
       codes within the CPT range of 70000-79999 and which were codes with a non-zero
       rate in the Technical Component (TC) field of the CMAC rate file. Within this
       group of claims, if the TC CMAC amount is less than the global CMAC and the
       claim does not have a TC modifier, it will be excluded.

DP Contract Notice at A7–A8 (emphasis added). As to Step 3, the government argues “plaintiffs
posit that essentially any difference between TMA’s data and the hospital’s data constitutes a
contract breach. However, this proposition cannot be derived from Step 3, and is not in the
parties’ contract at all.” Def.’s MSJ at 42. The government asserts the following actions did not
violate its obligations under Step 3 because “[t]he issue was not with the extraction itself, but
with the contents of the underlying records, whose examination and correction was in no way
required by the contract”: excluding (1) “some miscoded line items”; (2) “dump coded records”;
and (3) “line items without TC modifiers.” Id. at 42–43 (citing DPP Contract Notice A7–A8).

        Plaintiffs respond TMA’s extraction of data “from its own records . . . does not explain
why some of the data did not exist in [TMA’s] systems or how this somehow justifies failing to
perform its contractual obligations.” Pls.’ MSJ Resp. at 30. Plaintiffs also contend “[t]he
Government cannot reasonably argue that it was not required to conduct due diligence on its own
data, while at the same time refusing Plaintiffs access to the data.” Id. Plaintiffs argue TMA
should have corrected errors with the data “(e.g., the records conversion issue for 2003-2004 in
the South regarding to which the Government stipulated, and a fiscal intermediary advising of
erratic TC modifier practices in May 2011).” Id. at 30–31 (citing Def.’s MSJ at 43–44).
Plaintiffs add “if you look at Step 3, the government’s basic obligation was to extract the claims

                                              - 17 -
from each hospital for claims for outpatient radiology services during the relevant period.
Claims from each hospital has to mean the claims that the hospital submitted.” Tr. at 70:8–14.

        Building on the information hospitals supplied in Step 2, Step 3 provided “TMA will
extract the claims for each hospital for claims for outpatient radiology services during the
relevant period.” DPP Contract Notice at A7. From Merriam-Webster Dictionary’s definition of
“extract,” only two definitions are relevant: (1) “to draw forth (as by research)” e.g., “extract
data”; and (2) “to select (excerpts) and copy out or cite.” Extract, Merriam Webster Dictionary,
(11th ed. 2022); see Af–Cap, Inc. v. Chevron Overseas (Congo) Ltd., 475 F.3d 1080, 1088 (9th
Cir. 2007) (“When determining the plain meaning of language, we may consult dictionary
definitions.”). Using either definition, the word “extract” contemplates removing or copying
something from somewhere. Although plaintiffs argued under Step 3, “somewhere” must “mean
the claims that the hospital submitted,” Tr. at 70:13–14, plaintiffs admitted TMA extracted line
items from TMA’s own database as a practical matter. Tr. at 111:23–112:4 (“[COURT]: . . . .
[Step 3] begins, ‘TMA will extract the claims.’ Where is TMA to extract the claims from?
[PLAINTIFFS]: Well, from the database that the government maintains. . . . [COURT]: From
TMA’s database? [PLAINTIFFS]: Yeah, from TMA’s database”), 113:23–24
(“[PLAINTIFFS]: . . . . [A]s a practical matter, TMA was looking to its database.”). Further, in
arguing FAQ 4 does not support the government’s position, plaintiffs admitted TMA was “just
going to look at the records that are in the database and use those as a basis for the adjustment.”
Tr. at 20:11–13. Plaintiffs were aware at numerous stages of the process—from extracting line
items, Tr. at 111:23–112:4, to determining adjustment bases, Tr. 113:23–24—TMA was utilizing
its database. “The process of interpretation . . . turns in good part on what the court regards as
normal habits in the use of language, habits that would be expected of reasonable persons in the
circumstances of the parties.” E. Allan Farnsworth, Contracts 456 (4th ed. 2004). The parties
were aware TMA extracted line items from TMA’s own database, contextualizing the
interpretation of from where “TMA will extract the claims for each hospital.” DPP Contract
Notice at A7; see, e.g., George Backer Mgt. Corp. v. Acme Quilting Co., 385 N.E.2d 1062, 1065
(N.Y. 1978) (If particularized meaning is intended, “surely no problem of draftsmanship would
have stood in the way of its being spelled out.”).

         TMA extracted data from its database, so at oral argument the Court questioned “where
also in Step 3 then is TMA obligated to collect data from outside its database to make it match
something that the hospitals had submitted to the intermediaries?” to which plaintiffs responded,
“I think that’s built into what we believe is the only reasonable interpretation of what it means to
extract claims for each hospital.” Tr. at 113:8–15. The notion TMA’s duties are assumed,
however, only points back to the Court’s interpretation of “extract.” When the Court asked
whether Step 3 obligated TMA to seek data outside its database, plaintiffs initially said, “No,”
but plaintiffs later said, “‘[Y]es,’ . . . because Step 3 obligate[d] the government to adjust the
claims that the hospitals submitted.” Tr. at 112:11–19. Plaintiffs admitted for TMA to collect
data it lacked, TMA would “have [had] to go to the fiscal intermediaries[,]” Tr. at 177:15–16;
however, the contract expressly stated TMA would not go to the intermediaries. See DPP
Contract Letter at A1 (“DoD has decided to calculate the net adjustments itself, rather than
through the [intermediaries].”); supra Section IV.A. Further, FAQ 2 clarified hospitals did not
need to provide claims-level data, rather “TRICARE will do this.” DPP Contract FAQs at A10
(answering “[y]ou need to submit only the information in the Excel sheet” to the question “Will I

                                               - 18 -
need to provide further information?”). Plaintiffs attempted to contextualize the notion TMA
would adjust the claims with an action TMA explicitly rejected: using intermediaries. See DPP
Contract Letter at A1; supra Section IV.A. Plaintiffs’ arguments Step 3 obligated TMA to
extract the hospitals’ radiology data accordingly impermissibly reach beyond the plain meaning
of the text. See Jowett, Inc., 234 F.3d at 1368 (quoting McAbee Constr., Inc., 97 F.3d at 1435);
DPP Contract Notice at A7; DPP Contract FAQs at A10.

        After TMA “extract[ed] the claims for each hospital” meeting certain criteria, Step 3
further provided certain claims “will be excluded” from what “TMA will extract.” DPP Contract
Notice at A7–A8. For example:

        All hospital outpatient department claims for radiology paid as billed, with [other
        hospital insurance (‘OHI’)], or with a professional modifier (-26) [the professional
        component used when a physician interprets but does not perform the test] will be
        excluded. . . . Within this group of [radiology] claims, if the Technical Component
        (TC) CMAC amount is less than the global CMAC and the claim does not have a
        TC modifier, it will be excluded.

Id. at A7. In addition to defining “extract” as “to select (excerpts) and copy out or cite,”
Merriam Webster Dictionary also defines “exclude” as “to expel . . . especially from a place or
position previously occupied.” See Extract, Exclude, Merriam Webster Dictionary. Reading the
definitions together, TMA must extract data before it can then exclude portions of its extractions
because TMA must “select” excerpts of data from hospitals request before it is able to “expel”
certain data points. As the ordinary meaning of the Step 3 exclusions merely narrow the
universe of considered data from what “TMA will extract,” the claims data “TMA will extract”
is the largest universe of data TMA was obligated to consider. Excluding existing database data
is the plain meaning of excluding data TMA extracts in Step 3. See Jowett, Inc., 234 F.3d at
1368 (quoting McAbee Constr., Inc., 97 F.3d at 1435); DPP Contract Notice at A7–A8.

        One of the excluded claims relates to “dump codes.” The government explained a dump
code is a non-CMAC-associated generic code from a fiscal intermediary resulting from the
inability of the coder to input the proper CPT code. See Tr. at 46:16–21. 8 Regarding “dump
codes,” Step 3 provided “[r]adiology claims will include codes within the CPT range of
70000-79999 and which were codes with a non-zero rate in the TC field of the CMAC rate file.”
DPP Contract Notice at A7 (emphasis added). Dump codes have a zero rate in the TC field, so
dump codes were not included in the data TMA extracted according to Step 3. Id. Plaintiffs
argue TMA erred by excluding dump codes. See Pls.’ MSJ Resp. at 21. TMA’s obligations
stem from the contract, and the contract expressly provided TMA would exclude dump codes.
See DPP Contract Notice at A7. Plaintiffs admitted under Step 3 “the DPP provided that claims
with certain CPT codes would be adjusted” and “[a] dump code falls outside that.” Tr. at 63:6–9.
Therefore, TMA did not err in excluding dump codes per Step 3. Under a plain meaning rule,
there is a two-stage process. In the first stage, the court makes a preliminary determination of
whether the language in dispute lacks the required degree of clarity before going on to the second

8
 The government noted during oral argument, “there were 82 line items [out of 4,006 total] for Ingham that were
not adjusted because of the dump code issue.” Tr. at 46:9–11; see Tr. at 44:18–19 (“[THE GOVERNMENT:] . . .
[W]e adjusted 4,006 line items for Ingham.”).

                                                     - 19 -
stage, that of interpretation. E. Allan Farnsworth, Contracts 464 (4th ed. 2004) (quoting Arthur
L. Corbin, The Parol Evidence Rule, 53 YALE L.J. 603, 622 (1944)). The direction of Step 3 that
dump codes fall outside of TMA’s adjustment purview does not “lack the required degree of
clarity,” so the Court does not need to proceed with interpretation. See id.

                             i.       Whether the Word “Each” Qualifies “Claim” and “Hospital”
                                      in Steps 1 through 6 Individually or Collectively

       Plaintiffs contend the government was obligated to analyze the hospitals’ radiology data.
Pls.’ MSJ Resp. at 27. Plaintiffs emphasize the word “each” in Steps 3 through 6 supports their
hospital-data interpretation. 9 Id. After admitting at oral argument TMA extracted claims from

9
    The Notice provides in full Steps 3–6:

           Step 3: TMA will extract the claims for each hospital for claims for outpatient radiology services
           during the relevant period (either the August 2003-April 2009, August 2003-December 2009, or
           August 2003-November 2010 period). All hospital outpatient department claims for radiology paid
           as billed, with OHI, or with a professional modifier (-26) will be excluded. Radiology claims will
           include codes within the CPT range of 70000-79999 and which were codes with a non-zero rate in
           the Technical Component (TC) field of the CMAC rate file. Within this group of claims, if the TC
           CMAC amount is less than the global CMAC and the claim does not have a TC modifier, it will be
           excluded.

           Step 4: TMA will calculate what would have been paid under the approach that Medicare used to
           pay hospital outpatient radiology claims prior to CMS’s implementation of the Medicare OPPS in
           2000. Medicare used a weighted blending of two factors with 42 percent for the first factor and 58
           percent for the second factor. We refer to this as the “Medicare” method. Specifically, TMA would
           use the following formula to calculate the “Medicare” allowed amount for each hospital radiology
           claim:
                    .42 (BC*CCR) + .58 (.62 global CMAC)
           where: BC = billed charge for that line item
                    CCR= the hospital-specific outpatient cost-to-charge ratio
                    Global CMAC = the global CMAC for that CPT code (line item)
           TMA will perform separate calculations of the “Medicare” amount for the following periods. Each
           period corresponds to a change in the TRICARE CMAC amounts:
                    August 11, 2003-February 29, 2004
                    March 1, 2004-March 31, 2005
                    April 1, 2005-February 28, 2006
                    March 1, 2006-January 31, 2007
                    February 1, 2007-February 29, 2008
                    March 1, 2008-February 28, 2009
                    March 1, 2009-March 31, 2010
                    April 1, 2010-June 30, 2010
                    July 1, 2010-July 31, 2010
                    August 1, 2010-December 31, 2010
           The outpatient cost-to-charge ratio (CCR) used for each period shall be the hospital-specific
           outpatient CCR in effect on the first day of each period as provided on the Outpatient Provider
           Specific File (OPSF) available from CMS’s OPPS Pricer file.

           Step 5: To reflect the value of discounts at network hospitals, TMA will adjust the “Medicare”
           amount calculated in Step 4 on each claim using the ratio of the actual allowed amount on the claim
           to the TRICARE Standard allowed amount (the technical component of the CMAC). For example,
           if the TRICARE Standard technical portion of the CMAC for a radiology claim was equal to $100

                                                         - 20 -
its database, plaintiffs agreed the phrase “each hospital” in Step 3 is the same as “each hospital”
in Step 2:

        A separate Excel spreadsheet must be completed for each hospital in the
        TMA-specified format.

DPP Contract Notice at A7 (emphasis added); Tr. at 112:5–7. The word “each” immediately
precedes—and modifies—the word “hospital,” so the plain meaning of the word “each”
instructed TMA to extract data based on the individual hospitals that submitted their identifying
information per Steps 1 and 2. See DPP Contract Notice at A7 (“TMA will extract the claims for
each hospital . . . .”). The plain meaning of “each hospital” accordingly does not change the
scope of TMA’s duty to “extract [from its database] the claims for each hospital” which
submitted identifying information according to Step 2. Id.

        Regarding Steps 4 through 6, the word “each” modifies “hospital radiology claim” in
Step 4, and “claim” in Steps 5 and 6. Id. at A8–A9. As Steps 4, 5, and 6 sequentially follow
Steps 1, 2, and 3, the “each hospital radiology claim” and “each claim” language in Steps 4, 5,
and 6 referred only to each individual claim extracted and not excluded under Step 3. Steps 4
through 6 described the calculations TMA was to perform, so the word “each” in this context
denoted TMA was to analyze claims on an individual basis as opposed to collectively. The DPP
specifically included “each” as the modifier as opposed to an indefinite article like “a.” “Each”
is a word of limitation as opposed to the generalizing force of “a.” See Am. Bus Ass’n v. Slater,
231 F.3d 1, 4–5 (D.C. Cir. 2000). The only interpretation that “makes sense,” therefore, is if the
plain meaning of the word “each” does not broaden TMA’s duty to extract data from its database
and then use this data for TMA’s analysis of individual claims for each hospital. Put differently,
TMA is only responsible for analyzing the data of each claim of each hospital. See Jowett, Inc.,
234 F.3d at 1368 (quoting McAbee Constr., Inc., 97 F.3d at 1435 and giving “the words of the
agreement their ordinary meaning unless the parties mutually intended and agreed to an
alternative meaning”); DPP Contract Notice at A7–A9.

        and the actual allowed amount on the claim was equal to $95, the ratio is 0.95. This difference could
        occur because of a hospital discount. In this example, the adjusted “Medicare” amount would be
        equal to 0.95 multiplied by the “Medicare” amount prior to adjustment. If both the actual and the
        TRICARE Standard amounts were equal (for example, because there were no discounts), the ratio
        would be equal to 1.0 (the ratio could not exceed a value of 1.0). For purposes of this discretionary
        adjustment, this process will level discounts over the period even if the hospital may not have had a
        network agreement in effect at the time of any individual service claim.

        Step 6: TMA will then compare the adjusted “Medicare” amount for each claim with the actual
        allowed amounts on that claim. TMA will calculate the difference between the two amounts. The
        positive and negative differences will be summed over the entire 2003-2009 period (or the
        2003-2010 period for hospitals not subject to OPPS). If the sum of the differences is positive
        (because the adjusted “Medicare” allowed amounts exceed the actual allowed amounts) then this
        information will be used in determining the level of the additional payment to the hospital. If the
        actual allowed amounts are equal to or exceed the “adjusted Medicare” amounts, then no additional
        payment shall be made.

DPP Contract Notice at A7–A9 (emphasis added).

                                                       - 21 -
               3.     Whether FAQ 14’s Clarification of “The Notice to Hospitals of
                      Potential Adjustment to Past Payment for Outpatient Radiology
                      Services” Applies to the Kennell Study or the DPP Calculations

        The government argues FAQ 14, which clarifies the DPP “analysis was performed on a
service line basis, rather than on a hospital specific basis,” does not impose a duty on TMA to
extract and analyze the hospitals’ radiology data. Def.’s MSJ Reply at 14–15 (quoting FAQ 14).
The government asserts FAQ 14 is irrelevant to TMA’s duty as “it is describing the methodology
that was used in the Kennell studies that were conducted prior to the [DPP] to determine whether
TRICARE’s payment methodology was comparable to Medicare’s across different types of
outpatient services generally.” Id. at 14. Plaintiffs argue FAQ 14 does require the government
to extract all hospital radiology claims, emphasizing “[t]he [data] analysis was performed on a
service line basis.” Id.

         The FAQ, published in 2013, mentions the data analysis of hospital outpatient services
generally, not just radiology claims, so the FAQ—by its plain meaning—refers to the Kennell
study. See DPP Contract FAQs at A12. The 2013 FAQ also refers to the data analysis in past
tense which further signals it refers to the Kennell study, which accounted for 2003–2009 data:
FAQ 14 specifies “[t]he analysis was performed on a service line basis, rather than on a hospital
specific basis,” confirming the provision must refer to the Kennell study and not the
yet-to-be-performed DPP calculations according to the contract. See id. (emphasis added). The
Kennell study does not apply to individual hospital claims, and the DPP obligated TMA to
perform—but not to the extent of extracting and analyzing radiology data not in the database.
FAQ 14’s clarification of “The Notice to Hospitals of Potential Adjustment to Past Payment for
Outpatient Radiology Services” applies to the Kennell study, which occurred before the
publication of the Notice and thus does not provide context to TMA’s contractual duty regarding
plaintiffs’ data. See J & B Steel Contractors, Inc. v. C. Iber & Sons, Inc., 642 N.E.2d 1215, 1218
(Ill. 1994) (interpreting existence of ambiguity by looking solely at what appears within the
written contract itself).

               4.     Whether Spearin Applies

       Citing D.F.K. Enterprises, Inc., a 1999 Court of Federal Claims case in which a contractor
sued alleging the Army Corps of Engineers breached a contract to paint a water storage tank by
misrepresenting the amount of adverse weather experienced at the site, plaintiffs argue TMA
“had a contractual duty to verify its data because it implicitly warranted that its representations
about the data were accurate.” Pls.’ MSJ Resp. at 26 (citing D.F.K. Enters., Inc., 45 Fed. Cl. at
285); see infra Section IV.B (holding TMA’s data and its performance according to the DPP
methodology were both within TMA’s control). In a related 1918 case, the Supreme Court
considered a government contract to construct a dry dock at the Brooklyn Navy Yard. United
States v. Spearin, 248 U.S. 132, 133 (1918). The Court found “the insertion of the articles
prescribing the character, dimensions and location of the sewer imported a warranty that if the
specifications were complied with, the sewer would be adequate. This implied warranty is not
overcome by the general clauses requiring the contractor to examine the site . . . .” Id. at 137.
Further, in Spearin, the government specified steps for the contractor to follow, which implied
these steps would lead to a certain result. Id. at 133; see also Lakeshore Eng’g Servs., Inc. v.

                                              - 22 -
United States, 748 F.3d 1341, 1349 (Fed. Cir. 2014) (“[T]he Supreme Court in Spearin
recognized that an implied warranty arises in a particular circumstance: when a contractual
requirement binds the builder to follow design specifications stated in the contract.”). The basis
for the “Spearin Doctrine” is when contractors are bound to build according to the plans and
specifications provided by the owner, the contractor should not be responsible for damages that,
through no fault of his own, occur when the plans and specifications are defective. In response
to plaintiffs’ citation of D.F.K. Enterprises, Inc., the government characterizes D.F.K.
Enterprises, Inc. as “a Spearin warranty case” and clarifies “Spearin does not apply in a ‘case
[that] does not involve a design specification that bound [the contractor] but turned out to
produce a defective or unsafe construction.’” Def.’s MSJ Reply at 13 (first citing D.F.K. Enters.,
Inc., 45 Fed. Cl. at 285, and then citing Lakeshore, 748 F.3d at 1349). The Court agrees Spearin
implied warranties apply in design specification cases, and plaintiffs fail to cite any non-design
specification cases for their argument. In this case, moreover, the contract specified how TMA
should perform under the DPP Contract, not how the contractor—plaintiffs in this case—should
perform. For example, Step 3 of the contract states, “TMA will extract the claims for each
hospital for claims for outpatient radiology services during the relevant period.” See Def.’s MSJ
Reply at 10–11 (citing DPP Contract Notice at A7–A8). TMA created a duty for itself, if
anything, not an implied warranty.

       The government argues further on the issue of implied warranties, “if the government was
promising to do something as elaborate as going and checking records . . . there would be an
explicit express obligation in the contract to do that.” Tr. at 125:6–9. The government explained
“that would be a very complicated prospect and it’s in no way contemplated in the language of
this instrument.” Tr. at 125:9–11. Plaintiffs responded “[i]f the government was going to do
anything less than its promise, which was to extract all the hospitals’ claims, it should have
provided a disclaimer of that fact and it didn’t.” Tr. at 125:21–24. Plaintiffs’ argument on this
point requires the Court first accept their argument TMA had an express obligation to analyze
the hospitals’ data, which the Court rejects. See infra Section IV.A.5. Further, the Court agrees
with the government if TMA had promised to analyze the hospitals’ data, which would have
required requesting data from intermediaries or plaintiffs themselves and would have been a
complicated process, the DPP Contract would have provided so expressly. See DPP Contract
Notice at A7 (requesting “claims” data—not “all” or “new” data). TMA thus lacked a
contractual duty to extract, analyze, and adjust the hospitals’ radiology data. See Moore v.
Shawmut Woodworking & Supply, Inc., 788 F.Supp.2d 821, 825, 829 (S.D. Ind. 2011) (finding a
breach of contract can be predicated upon a contractual duty only when the contract affirmatively
evinces an intent to charge one party with a duty).

               5.     Conclusion

       The Court finds TMA did not have a contractual duty to “locate, identify, and adjust each
and every line item for radiology ever paid,” or put another way, “the Parties’ contracts
contained no requirement that the Government extract and adjust all of Plaintiffs’ radiology
data.” Def.’s MSJ at 34; Def.’s MSJ Reply at 6 (cleaned up); see Jowett, Inc., 234 F.3d at 1368
(quoting McAbee Constr., Inc., 97 F.3d at 1435); Trauma Serv. Grp. v. United States, 104 F.3d
1321, 1325 (Fed. Cir. 1997); San Carlos Irrigation & Drainage Dist., 877 F.2d at 959; DPP
Contract Letter at A1–A2; DPP Contract Notice at A3–A9; DPP Contract FAQs at A10–A15;

                                              - 23 -
DPP Contract Release at A17. As the government has shown TMA lacked this specific
contractual duty, the government has proven it is “entitled to a judgment as a matter of law”; the
Court accordingly grants the government’s motion for summary judgment as to plaintiffs’ breach
of contract claim regarding TMA’s lack of contractual duty to extract, analyze, and adjust the
hospitals’ radiology data. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247 (1986).

         B.       Whether TMA Had a Contractual Duty to Extract, Analyze, and Adjust
                  Radiology Data from its Database

         Regarding TMA’s duty to extract, analyze, and adjust radiology data, plaintiffs argue
even if the Court found TMA was not obligated “to extract and analyze all of plaintiffs’
radiology data,” “there would still be a breach.” Tr. at 131:8–16. Plaintiffs note “[t]he
government has . . . stipulated to the fact that there were line items in their database that met the
criteria for extraction that were not adjusted. That’s still a breach.” Tr. at 131:18–21; see also
Tr. at 85:4–7 (“[PLAINTIFFS:] . . . [T]he government has stipulated that there are certain claims
that did meet the criteria for extraction that were not adjusted, even though they were in their
database.”).

        As discussed supra Section IV.A.2, Step 3 provided “TMA will extract the claims” and
then exclude certain claims using specified criteria. See DPP Contract Notice at A7. The
government admits “[t]he contract provided that TMA first would extract data with certain
contractually-specified identifiers from its own records, and use the methodology specified in the
parties’ contract to generate a proposed adjustment amount.” Def.’s MSJ at 31 (citing DPP
Contract Notice at A7–A8). The government also concedes it “failed to include [several] line
items . . . that met the criteria for extraction set forth in Step 3.” Def.’s MSJ Reply at 5 (citing
DPP Contract Notice at A9; DPP Contract FAQs at A15). The government also conceded at oral
argument TMA’s exclusion of several line items “although they met the criteria for extraction”
“would not be compliant with Step 3.” See Tr. at 80:1–9. The government then stated: “[D]id
our algorithm fail in some way on Step 3 for these 13 line items? Sure.” Tr. at 81:19–21. The
government finally said “[it] agreed to extract the records in our possession.” Tr. at 97:20–21.
The government admitting it had a duty according to Step 3 is consistent with the contract
language; to assert otherwise would lead to the absurd result where TMA could have performed
calculations based on plainly incorrect data that did not match the data in TMA’s system. At oral
argument, the government admitted if TMA provided bogus data, it technically would have
breached the contract. Tr. at 97:3–10 (“THE COURT: But if [TMA] provided bogus data, that
wouldn’t be following the process as detailed in the DPP, that would be a breach. [THE
GOVERNMENT]: . . . yes.”); see also Tr. at 224:2–7 (“[PLAINTIFFS:] . . . [I]f the government
were not obligated to use accurate data in doing its adjustments, on some level it would be an
illusory promise, right, because the government could use whatever data and come up with
whatever result and it wouldn’t be a breach.”). 10 The Court accordingly finds TMA did have a

10
   The algorithm’s failure does not amount to an illusory promise, a promise that is unenforceable due to
indefiniteness or lack of mutuality. 1 Corbin on Contracts § 1.17 (2022). A promise conditioned upon an event
within the promisor’s control is not illusory if the promisor also “impliedly promises to make reasonable effort to
bring the event about or to use good faith and honest judgment in determining whether or not it has in fact
occurred.” Id. In this case, TMA had a duty to extract data in its records, but the failure to utilize “perfect data” is
not illusory.

                                                         - 24 -
duty under the plain language of Step 3 to extract, analyze, and adjust radiology data from its
database. See Jowett, Inc., 234 F.3d at 1368 (quoting McAbee Constr., Inc., 97 F.3d at 1435);
Trauma Serv. Grp., 104 F.3d at 1325; San Carlos Irrigation & Drainage Dist., 877 F.2d at 959;
DPP Contract Letter at A1–A2; DPP Contract Notice at A3–A9; DPP Contract FAQs at
A10–A15; DPP Contract Release at A17.

       C.      Whether TMA Had a Contractual Duty to Consider Zip Codes Not Provided
               by Hospitals

        Regarding plaintiff Integris Baptist, who the government stipulates had five unadjusted
line items during the DPP because of an alternate zip code, the government states “there is no
dispute that Integris Baptist did not advise TMA that it provided radiology services in zip code
73116” under Step 2. Def.’s MSJ Reply at 4 (citing DPP Contract Notice at A7). Step 2
provided “[a]s part of the request, hospital submits data with its . . . zip code[.]” DPP Contract
Notice at A7. FAQ 8 answered “[p]lease provide the address and zip code of the physical
location of the hospital” to the question “[s]hould I provide the address of the physical location
of the hospital or a billing address?” DPP Contract FAQs at A11.

        The government argues “it does not appear that plaintiffs could meet their burden of
proving [TMA’s failure to adjust five line items associated with an alternative zip code for
Integris Baptist Medical Center] constituted an error of extraction. Step 2 of the Notice required
hospitals to provide zip code information to TMA to facilitate the extraction process.” Def.’s
MSJ at 43 n.9 (citations omitted). Plaintiffs, however, contend “the DPP doesn’t make any
provision that if a hospital has multiple locations, that all of the zip codes must be separately
identified in the DPP.” Tr. at 9:18–20.

        Plaintiffs admit there is no “evidence that [Integris Baptist] did” provide TMA with its
73116 zip code so this issue is not factually disputed. Tr. at 8:14–21. Plaintiffs, however, argue
Integris Baptist was not obligated to do so because the contract only provided hospitals must
submit their “zip code” not “zip codes.” Tr. at 8:19–9:2. The government counters it is “a
reasonable reading of the provision to assume that if a hospital has more than one physical
location, it’s going to advise the government to that effect.” Tr. at 10:6–9. The government
argues “under FAQ 8, the physical location zip code had to be provided and [Integris Baptist]
didn’t.” Tr. at 10:17–18.

        Interpreting the zip code requirement of Step 2 requires examining its context. Step 2
provides: “As part of the request, hospital submits data with its name, address, zip code, Tax ID
number, TRICARE sub ID number, the 6-digit Medicare OSCAR provider number, and NPI
number. [(“Sentence 1”).] If multiple Tax ID or Medicare provider numbers were used during
this period, hospitals will submit these data. [(“Sentence 2”).]” DPP Contract Notice at A7
(emphasis added). The plain meaning of Sentence 1 in context requires submission of only one
zip code. Reading the two sentences together raises the negative implication canon, a tool of
contract interpretation this court has employed many times. See, e.g., United Pac. Ins. v. United
States, 497 F.2d 1402, 1405 (Ct. Cl. 1974) (applying the rule of expressio unius est exclusio
alterius to find when language specifically provided where flashings were to be installed, there
was manifested an intention the flashings are not required to be installed elsewhere); Pub. Util.

                                               - 25 -
Dist. No. 1 v. United States, 20 Cl. Ct. 696, 700 (1990) (interpreting a contract using the doctrine
of expressio unius est exclusion alterius); Nicholson v. United States, 29 Fed. Cl. 180, 196
(1993) (explaining where particular things are specified in a contract, others of the same general
character are impliedly excluded); Sam Rayburn Mun. Power Agency v. United States, No.
20-1535, 2021 WL 4888872, at *12 (Fed. Cl. Oct. 19, 2021) (Holte, J.) (finding damages were
generally available under a contract, as an issue of subject matter jurisdiction, when the contract
enumerated three exceptions to damages); see also Scalia & Garner, supra, at 107–11
(describing the negative implication canon as “[t]he expression of one thing implies the
exclusion of others”). By listing two specific identifying criteria from Sentence 1 for which
hospitals should submit multiple values, “Tax ID” and “Medicare provider numbers[,]” DPP
Contract Notice at A7, Sentence 2 of the Notice implied hospitals did not have to submit
multiple values for the non-listed identifying criteria, including zip codes. See, e.g., United
States v. Giordano, 416 U.S. 505, 514 (1974) (finding an individual government employee was
not authorized to perform an action under a statute authorizing only two types of officials). The
plain meaning of Step 2 did not, therefore, require hospitals to submit multiple zip codes, and the
Court thus finds TMA did have a duty to consider zip codes for hospital locations not provided
by the hospitals. 11 See Jowett, Inc., 234 F.3d at 1368 (quoting McAbee Constr., Inc., 97 F.3d at
1435); Pub. Util. Dist. No. 1, 20 Cl. Ct. at 700; United Pac. Ins. v., 497 F.2d at 1405; DPP
Contract Notice at A7.

        D.       Whether TMA Breached its Contractual Duty to Extract, Analyze, and
                 Adjust Radiology Data from its Database and Damages

        Regarding TMA’s breach, plaintiffs argue, “the Government itself concedes that it did
not follow the methodology in the DPP[.]” Pls.’ MSJ Resp. at 27. Plaintiffs also argue the errors
with the data were not trivial, “[r]ather, the Excluded Hospitals Memo and the Settlement
Agreement prove that the Government failed to follow the DPP methodology on a substantially
large scale, rather than just in a few insignificant instances.” Id. at 29. Plaintiffs further argue
the government’s failure to extract line items “for unknown reasons” supports plaintiffs’
argument “the Government does not understand its own data and failed to satisfy its contractual
obligations.” Id. at 29–30.

        To prove breach of contract, plaintiffs must show the government “fail[ed] to perform a
contractual duty when it [was] due.” Trauma Serv. Grp., 104 F.3d at 1325. The Court finds
supra Section IV.B the DPP Contract obligated TMA to extract, analyze, and adjust plaintiffs’
radiology data TMA had in its system, and this is the duty plaintiffs allege TMA failed to
perform. See Pls.’ MSJ Resp. at 27. “The Government stipulates that there are nine line items
for Integris Baptist Medical Center, and four line items for Integris Bass Baptist Medical Center
that were not extracted from TMA’s databases in 2011, although they met the criteria for
extraction.” Def.’s MSJ at 30 (emphasis added) (citations omitted). The government concedes

11
  The Court holds under the plain meaning of Step 2 of the Notice but notes the parties did not discuss the language
of Sentence 2, “multiple Tax ID or Medicare provider numbers[,]” or the negative implication canon at oral
argument or in their briefing. See generally Tr.; Def.’s MSJ; Pls.’ MSJ Resp.; Def.’s MSJ Reply. Additionally, the
record does not reflect whether the multiple zip codes of Integris Baptist also had multiple associated Tax ID or
Medicare provider numbers or, if so, whether Integris Baptist submitted those numbers as required by Step 2. The
Court denies the government’s motion for summary judgment as to the line items covered by the alternative zip
code, see infra Section IV.F, but notes additional discovery may be required to determine liability.

                                                       - 26 -
its “algorithm fail[ed] in some way on Step 3 for these 13 line items[.]” Tr. at 81:19–21. The
government also states, “We believe that the contract express provisions provided what would
and would not be included in the adjustment set.” Tr. at 48:18–20. The government accordingly
admits TMA failed to follow the extraction criteria, at least in part.

        Although the government admits it technically breached the DPP Contract regarding
extraction, it argues “where government records are in the tens of millions, I think it would be
unreasonable to expect perfection . . . on something of this scale.” Tr. at 59:6–10. As support,
the government cites to FAQ 18 which contextualizes Step 8, directing questions about the
content—not the calculation—of claims data to TMA within thirty days of request response
receipt. Tr. at 82:13–18 (“[THE GOVERNMENT]: . . . [T]he purpose of the claims counts, it’s
from FAQ 18 and I think that the final sentence of that FAQ . . . the intention is that hospitals can
review these amounts to determine whether the historical claims counts and amounts are
reasonable.”). FAQ 18 stated, “Hospitals can review [the summary worksheet] amounts to
determine whether the historical claims counts and amounts are reasonable.” DPP Contract
FAQs at A14. The government emphasizes the language “are reasonable” to argue the
government did not “promis[e] exactitude.” Tr. at 82:18–21. The government adds FAQ 18
“doesn’t say exact; it says reasonable.” Tr. at 82:18. Plaintiffs respond, “[j]ust because Question
18 says ‘reasonable’ . . . the very best hospitals could do is some sort of reasonableness check.”
Tr. at 86: 8–11. Plaintiffs also argue “the hospitals [did not] ha[ve a] way of easily figuring this
out or doing some calculation as part of the DPP.” Tr. at 62:1–5.

        The government argues “historical claims counts and allowed amounts would be used to
assess reasonableness, not exactitude[,]” and thus, “even though it’s not, strictly speaking, a
complete compliance with Step 3, given the contract obligations as a whole, we don’t believe
that would be a breach either, particularly given Step 8.” Tr. at 80:13–19. The government also
argues infinitesimal variance is not “within the contemplation of the contract” under Southwest
Welding. Tr. at 83:23–25. In Southwest Welding, a contractor could not recover extra
compensation for additional work entitled by a 0.16 percent deviation from a base number of 90
degrees because it was within the variation contemplated by use of the figure “90 degrees plus or
minus.” Sw. Welding & Mfg. Co. v. United States, 373 F.2d 982, 985 (Ct. Cl. 1967). The
government asserts it did not “know that the technical noncompliance . . . with respect to this
negligible number of line items . . . is as grievous as it would appear on the face.” Tr. at
84:9–17. Plaintiffs note in the Southwest Welding case, “there were plus and minus symbols”
following the parameter at issue indicating there was an acceptable margin of error. Tr. at
85:17–20. Plaintiffs argue unlike Southwest Welding, “[t]here weren’t any plus or minus
symbols in the DPP or anything like plus or minus symbols[.]” Tr. at 85:21–22.

        “When performance of a duty under a contract is due any non-performance is a breach.”
Restatement (Second) of Contracts § 235(2) (Am. L. Inst. 1981). The Restatement further
explains: “[A] duty is discharged when it is fully performed. Nothing less than full
performance, however, has this effect and any defect in performance, even an insubstantial one,
prevents discharge on this ground.” § 235, cmt. a. “[A] ‘reasonable’ breach of contract is
nonetheless a breach.” Stockton E. Water Dist. v. United States, 583 F.3d 1344, 1365 (Fed. Cir.
2009). The government admits its “performance of a duty under [the DPP] contract”—extracting
plaintiffs’ radiology data which was in TMA’s database—was due. See § 235(2). Contrary to

                                               - 27 -
the Restatement, the government argues something less than full performance discharged its
obligation under the DPP. See § 235, cmt. A; Tr. at 80:13–19. In unambiguous terms, however,
the DPP Contract provided TMA’s duty was to “extract the claims for each hospital” and then
exclude certain claims. DPP Contract Notice at A7–A8. The government admitted it failed to do
just that. See e.g., Tr. at 81:19–21. Following the Restatement’s guidance, the Court finds
“[n]othing less than full performance” can satisfy TMA’s obligation to perform under the DPP
Contract, and “a ‘reasonable’ breach of contract is nonetheless a breach.” § 235, cmt. a; Stockton
E. Water Dist., 583 F.3d at 1365. As a matter of law regarding contract interpretation and the
government’s admission, the government’s failure to extract all thirteen line items for Integris
Baptist and Integris Bass Baptist constitutes a breach of TMA’s duty according to Step 3. See
Stockton E. Water Dist., 583 F.3d at 1365; DPP Contract Notice at A7; supra Section IV.B.

               1.      Damages
        To prevail on their breach of contract claim, plaintiffs must also prove damages. See San
Carlos Irrigation & Drainage Dist., 877 F.2d at 960 (citing Com. Int’l Co. v. United States, 338
F.2d 81, 86 (1964)). “Damages for a breach of contract are recoverable where: (1) the damages
were reasonably foreseeable by the breaching party at the time of contracting; (2) the breach is a
substantial causal factor in the damages; and (3) the damages are shown with reasonable
certainty.” Indiana Michigan Power Co. v. United States, 422 F.3d 1369, 1373 (Fed. Cir. 2005)
(citation omitted). The government admitted if the Court finds TMA was obligated to extract
and analyze plaintiffs’ radiology data from its system, and if the Court finds the government
failed to sufficiently prove a defense, the Court “would find that [the government] owed one
[named plaintiff] hospital $486”—plaintiffs would be entitled to some damages. Tr. at 133:7–15.
The parties, however, did not agree to any specific amount of damages, and plaintiffs argued
damages would be calculated after class certification. See Tr. at 134:2–7 (“a class would be
certified . . . and determining which hospitals were entitled to damages would be something that
would be resolved at that stage.”). The Court accordingly finds the government did not carry its
burden as the moving party of establishing plaintiffs cannot prove damages, and thus the
government did not show it is “entitled to a judgment as a matter of law” in this respect.
Anderson, 477 U.S. at 247; see Tr. at 133:7–15.

       E.      The Government’s Defenses to Breach of Contract

        In a breach of contract case, “[o]nce the facts of breach are established, the defendant has
the burden of pleading and proving any affirmative defense that legally excuses performance.”
Shell Oil Co. v. United States, 751 F.3d 1282, 1297 (Fed. Cir. 2014) (quoting Stockton E. Water
Dist., 583 F.3d at 1360). The defendant also has the burden of proving any risk-shifting defense
against a breach of contract claim by a preponderance of the evidence. See Cardiosom, L.L.C. v.
United States, 117 Fed. Cl. 526, 532 (2014) (denying the government’s motion for summary
judgment in a breach of contract case, in part, because the contract did not shift the relevant risk
to plaintiff). The Court accordingly considers first whether plaintiffs were obligated to check the
data under the DPP and second whether the DPP shifted the risk of any data errors to plaintiffs.

               1.      Whether Plaintiffs Had a Contractual Obligation to Check
                       Discretionary Adjusted Payment Data

                                               - 28 -
         In relevant part, Step 8 regarding written requests to TMA provided:

         While the methodology for calculating the adjustment is not subject to questions,
         any questions regarding the data used in the calculations should be received by
         TMA within 30 days of the date of TMA’s response as specified in the response.
         Any questions should be accompanied by detailed explanation of the alleged errors
         and the proposed corrections with supporting documentation.

DPP Contract Notice at A9. The government contends Step 8 “unequivocally placed the
ultimate responsibility for identifying any errors in the adjustment calculation squarely on the
plaintiffs, and not the Government.” Def.’s MSJ at 34. The government elaborates “the
hospitals shouldered the obligation under the contract to raise ‘any questions regarding the data
used in the calculations’ and provide a ‘detailed explanation of the alleged errors and the
proposed corrections with supporting documentation’ within 30 days.” Id. at 35–36. Step 8
“created a process by which the hospitals could challenge any perceived mistakes in the
calculations received, putting the onus on the hospitals to do so.” Id. at 43.

        Plaintiffs respond by noting the government’s “deliberate choice to use permissive
language in Step 8,” notably “should,” shows “Step 8 in no way required Plaintiffs to confirm
that the Government’s data was accurate.” Pls.’ MSJ Resp. at 34–35 (citing DPP Contract
Notice at A9). Plaintiffs further argue “[t]he Government could have similarly stated in Step 8
that ‘the hospitals are required to verify the Government’s calculations’ or that ‘the hospitals
must verify the Government’s data. However, the Government chose not to incorporate such
language.” Id. at 34. Plaintiffs argued Step 8 “is not what the Government asserts it is. It was
not ever intended to place an obligation on hospitals to undertake some elaborate investigation
and identify all possible errors. It was intended to set a time frame when they could ask
questions.” Tr. at 243:19–25.

        While the government at times argued at oral argument Step 8 obligated the hospitals to
verify the data TMA presented, Tr. at 93:11–12 (“[THE GOVERNMENT:] . . . it is a contract
obligation to bring any questions within a 30-day window”), the government admitted plaintiffs
were not obligated under the contract to check data, rather the contract merely permits plaintiffs
to verify. 12 See Tr. at 229:11–17 (“I agree that . . . Step 8 doesn’t say must—the language is not
as strong [as Lakeshore], but it’s still structurally putting the contractor on notice.”), 57:15–18
(government counsel characterizing Step 8 as plaintiffs’ “opportunity” to check radiology data),
93:8–11 (“[THE GOVERNMENT:] . . . the language in Step 8 is precatory only insofar as the
choice to undertake . . . a challenge rests with the Plaintiff”); see also Tr. at 91:21–24
(“[PLAINTIFFS:] . . . there’s nothing in the language of Step 8 that imposes an obligation on
12
   As relevant to the Court’s finding of no mutual mistake of fact infra Section V, the government admitted at oral
argument Step 8 only applies to radiology data questions. See Tr. at 229:24–230:4 (“THE COURT: . . . [Y]ou
argue that Step 8 applies to radiology claims. Are you also arguing that Step 8 applies to non-radiology claims?
[THE GOVERNMENT]: No. THE COURT: Not at all? [THE GOVERNMENT]: No.”). The government
argued non-radiology risk shifting only occurs by operation of law, citing ConocoPhillips v. United States, 501 F.3d
1374 (Fed. Cir. 2007), because plaintiffs chose to enter a business settlement expressly limited to radiology claims,
necessarily foreclosing adjustment for non-radiology claims. Tr. at 230:4–6 (“[THE GOVERNMENT]: . . . [T]he
risk shifting that occurs with respect to the non-radiology claims is by operation of law, not by contract
[pro]vision.”).

                                                       - 29 -
the hospitals to [investigate data]”). Plaintiffs therefore could verify the data but did not have to.
See e.g., Telzrow v. United States, 127 Fed. Cl. 115, 123–24 (2016) (holding the contract allowed
but did not require the government to collaborate with landowners on restoration project).

         Further, Step 8 provided “any questions regarding the data used in the calculations should
be received by TMA within 30 days of the date of TMA’s response as specified in the response.”
DPP Contract Notice at A9 (emphasis added). The Step 8 language is permissive, allowing
plaintiffs to submit questions if they so choose. See id.; Tr. at 91:24–92:1 (“[PLAINTIFFS]: . . .
I mean, really what [Step 8] does is put a time limit on how long [hospitals] are allowed to ask
questions if they so choose.”). If plaintiffs did not challenge TMA’s data under Step 8, plaintiffs
signed the Release, and TMA then paid the hospitals. See DPP Contract Notice at A9. The
government did not claim plaintiffs breached the DPP Contract by not checking the data, as the
government might claim if plaintiffs were obligated to verify the data. As TMA was required to
perform according to the DPP Contract even if plaintiffs failed to question the radiology data,
and as the government does not now claim plaintiffs breached the contract by failing to question
the data, the Court finds the plain meaning of Step 8 provided plaintiffs the option to challenge
TMA’s data—but not the obligation. 13 Jowett, Inc., 234 F.3d at 1368 (quoting McAbee Constr.,
Inc., 97 F.3d at 1435) (holding courts “must interpret the contract in a manner that gives meaning
to all of its provisions and makes sense.”); DPP Contract Notice at A9.

                  2.       Whether Plaintiffs Bore the Risk of Any Data Issues

        The government argued even if Step 8 is only optional and does not obligate plaintiffs to
check TMA’s data, it structurally places risk on plaintiffs, making them “the insurers of this
calculation.” Tr. at 212:11–13. As the Court finds TMA did not have a duty to analyze the
hospitals’ radiology data, the Court need not analyze whether plaintiffs bore the risk of this
alleged breach of contract. See supra Section IV.A. By contrast, as the Court finds TMA did
have a duty to extract, analyze, and adjust radiology data from TMA’s database, the Court must
consider whether plaintiffs bore the risk of this alleged breach of contract. See supra Section
IV.B.

        The government argues TMA was not required to disclaim data accuracy because “[t]he
entire contract structure provided plaintiffs with more than adequate notice that they, not the
Government, were to be the ultimate insurers of the proposed adjustment calculations, and that
they should act accordingly.” Def.’s MSJ Reply at 8. Considering Step 8 and FAQ 18, the
government argues this case is like Lakeshore wherein the Federal Circuit recognized a
contract’s structure may “‘reinforce[] the allocation of risk by affirmatively pointing [a] potential
contractor to the mechanism it should use . . . to account for potential . . . error[,]’ and put that
potential contractor on notice to protect its interests.” Id. at 9–10 (quoting Lakeshore, 748 F.3d
at 1347). The government also distinguishes Metcalf Construction Co., 742 F.3d at 995–96, by

13
  Plaintiffs argue even if the Court finds the DPP Contract did require hospitals submit questions per Step 8, “the
Government made it impossible for Plaintiffs to do so within thirty days.” Pls.’ MSJ Resp. at 35. As the
government notes, impracticability is “‘intended for use as a defense to a breach-of-contract claim for
nonperformance, not as a theory to be used in pursuit of an affirmative remedy[.]’” Def.’s MSJ at 44 n.10 (quoting
CanPro Invs., Ltd. v. United States, 130 Fed. Cl. 320, 345 (2017))). Additionally, some hospitals submitted
questions within the thirty-day period. Id.; Tr. at 247:14–249:3. The Court finds supra plaintiffs were not obligated
to verify TMA’s data, so the Court need not consider plaintiffs’ impracticability argument.

                                                       - 30 -
arguing “here, (1) there were no affirmative representations, and (2) consistent with Lakeshore,
the contract implicitly warned plaintiffs . . . were to take into account a risk or [sic] error.” Def.’s
MSJ Reply at 10. The government adds “[t]here would be no need for Step 8 . . . if TMA was
guaranteeing that the data that it extracted from its own databases, or the extraction process
itself, would be perfect.” Def.’s MSJ at 41. The government contends “hospitals were free to
check against their own records for the same services[.]” Def.’s MSJ Reply at 5 (citing DPP
Contract Notice at A9; DPP Contract FAQs at A15).

        Plaintiffs respond “the DPP . . . did not allocate the risk to Plaintiffs.” Pls.’ MSJ Resp. at
37 (citing Metcalf Constr. Co., 742 F.3d at 996). Plaintiffs also note “[i]f the Federal Circuit
considered Step 8 to be a basis upon which to defeat Plaintiffs’ claim, the Federal Circuit would
have presumably done so, rather than remanding the claim.” Id. at 38–39 (citing Glaxo Grp. Ltd.
v. TorPharm, Inc., 153 F.3d 1366, 1371 (Fed. Cir. 1998) (“[A]n appellate court may affirm a
judgment of a district court on any ground the law and the record will support . . . .”)).

        Regarding its argument the contract expressly shifted the risk of data errors to plaintiffs,
the government argued “although . . . Lakeshore is maybe 75 percent on all fours, it’s the closest
case.” Tr. at 227:17–19. In Lakeshore, the Federal Circuit affirmed the Court of Federal
Claims’ grant of summary judgment in favor of the government. 748 F.3d at 1343. To solicit
“bids for a contract for [future, indefinite] repair, maintenance, and construction services at Fort
Rucker, Alabama[,]” the United States Army Contracting Agency instructed prospective
contractors to submit bids using prices found in the Universal Unit Price Book (“UUPB”) and
then multiply these costs by coefficients to account for costs not considered in the UUPB. Id.
The Federal Circuit noted “[a] fundamental aspect of contracts for future performance is how
they allocate risks related to the performance.” Id. at 1350. The Federal Circuit concluded that
“the language of the contract does not promise that the prices [provided] in the UUPB were
accurate or place on the government the risk that they will turn out to be inaccurate” and instead
“the only reasonable conclusion on the evidence here is that any risk that the prices in the UUPB
were inaccurate at the time of contracting was borne by [the plaintiff].” Id. at 1347. The Federal
Circuit supported its conclusion with three reasons: (1) the contract lacked a promise the prices
would be accurate, and the firm fixed-price nature of the agreement in dispute shifted the risk to
the contractor; (2) the contract “affirmatively point[ed] the potential contractor to the mechanism
it should use in its bid to account for potential error in the 2006 UUPB prices”; and (3) the
plaintiff’s “own actions ma[d]e clear that it understood that it was responsible for checking the
2006 UUPB unit prices and setting its coefficients accordingly.” Id. The essence of the Federal
Circuit’s conclusion was rooted in its finding the plaintiff could not “rewrite the clauses to
provide it protections the government did not agree to.” Id. at 1348 (citing ConocoPhillips v.
United States, 501 F.3d 1374, 1379 (Fed. Cir. 2007)).

       First, unlike Lakeshore, the contract in this case did not involve future government
procurement but rather the calculation of discretionary adjustment payments for past services
performed by plaintiffs. The DPP Contract involved an adjustment paid shortly after the contract
was executed, unlike Lakeshore involving payment for services “indefinite as to delivery and
quantity” rendered at some undetermined future date with potential interim market fluctuations
in material or labor prices. The risk borne by the contractor in Lakeshore was risk of future
market price fluctuations, outside the government’s control, whereas in this case the government

                                                 - 31 -
asks the Court to find plaintiffs bore the risk of the government’s failure to perform according to
the contract. See DPP Contract Notice at A7–A9.

         Second, the government admits Step 8 “is not as strong” as the risk-shifting language in
Lakeshore. Tr. at 229:1–13. In Lakeshore, the Federal Circuit noted the procurement contract
stated the plaintiff must use a coefficient to “take into account ‘all costs other than the prepriced
unit prices,’ and it provide[d] a nonexclusive list of the factors that the coefficient must include,
one of which [wa]s ‘[o]ther risks of doing business.’” 748 F.3d at 1347. The Lakeshore
solicitation also provided “the coefficients must ‘contain all costs other than the prepriced unit
prices, as no allowance [would] be made after award.’” Id. at 1343. In this case, however, the
DPP Contract obligated the government to “extract the claims[,]” “calculate what would have
been paid under the [Medicare method,]” and send a written response to hospitals detailing “the
calculated discretionary adjusted payment and the calculations from which the adjustment was
derived.” DPP Contract Notice at A7–A9. The contract then provided plaintiffs the opportunity
to check the data and calculations according to Step 8. Step 8 noted “any questions regarding the
data used in the calculations should be received by TMA within 30 days of the date of TMA’s
response[.]” Id. at A9. Given the contract obligated TMA to “extract” radiology line items from
its database, the plain meaning and purpose of Step 8 was to give hospitals a chance to
cross-reference their data with a summary of TMA’s extracted data. See Tr. at 212:16–24
(“[PLAINTIFFS:] . . . [T]he purpose of Step 8 is to limit the amount of time in which the
government will entertain questions from the plaintiffs. It says if you have any questions about
the calculations . . . you have to get those to us within 30 days, otherwise we’re not going to
listen to them.”). Though the government argues TMA “made no statements or promises that its
own work is accurate[,]” Tr. at 229:20–21, TMA did expressly promise it would extract from its
database and include or exclude radiology line items according to specific criteria. See DPP
Contract Notice at A7; Tr. at 239:11–15 (“[PLAINTIFFS:] . . . [T]he government promised that
it would extract the hospitals’ claims. The government has to perform that promise even if it
turns out that it’s difficult for the government to do so.”).

         Not only is Step 8 weaker than the contractual language the Federal Circuit held shifted
risk to the contractor in Lakeshore, but also the DPP Contract did affirmatively obligate TMA to
perform in a particular manner which it admits it failed to do—e.g., “TMA will extract the
claims for each hospital for claims for outpatient radiology services during the relevant period[.]”
DPP Contract Notice at A7. In Lakeshore, the Federal Circuit held the plaintiff “has advanced
no evidence that could support a finding that the government represented that the UUPB prices
were accurate and could be relied on by [the plaintiff], with the government assuming the risk of
error in those prices.” 748 F.3d at 1348. A key distinction between this case and Lakeshore is
the government here did not do what the contract specified it must. 14 By asking the Court to
enforce the contract according to TMA’s express obligations to consider its own data, plaintiffs

14
   Though the government’s argument using Lakeshore is distinguishable when it comes to plaintiffs’ TMA-data
duty claim—alleging the government had a duty to adjust line items in its database—the government’s argument
using Lakeshore is more closely analogous against plaintiffs’ “hospital-data duty” claim—alleging the government
had a duty to adjust all hospital data, including data from intermediaries or plaintiffs not in TMA’s database. Like
the contract in Lakeshore, the DPP Contract does not expressly provide for this hospital-data obligation. The Court
finds the government prevails as a matter of law on plaintiffs’ hospital-data duty claim because the government was
not obligated to analyze all hospital’s radiology data, supra Section IV.A. There is therefore no reason to analyze
further whether plaintiffs bore the risk of their hospital-data duty claim.

                                                       - 32 -
in this case are accordingly not seeking to “rewrite the clauses to provide it protections the
government did not agree to[,]” but rather plaintiffs request TMA perform as it was contractually
obligated. Lakeshore, 748 F.3d at 1348 (citing ConocoPhillips, 501 F.3d at 1379). Further,
TMA’s data and its performance according to the DPP methodology were both within TMA’s
control, unlike the materials and labor pricing in Lakeshore.

        Plaintiffs add, unlike Lakeshore, “there’s nothing in Step 8 that says you have to do this,
otherwise the government is off the hook and they don’t have to perform their obligations under
the agreement.” Tr. at 216:23–25. Although the government states it does not argue the Release
applies, Step 8 aside, the government’s argument would require the Court to enforce the Release
against plaintiffs’ remaining breach of contract claim. The government also mentioned the
Release as barring plaintiffs’ claim at oral argument. See Tr. at 227:2–3 (“[THE
GOVERNMENT:] . . . They know that the deadline cannot be extended. That’s in the FAQs.
They execute[d] a release.”). This argument, however, improperly contradicts the Federal
Circuit’s guidance: the Release cannot bar a suit for breach of the underlying contract. See
Ingham Reg’l Med. Ctr. v. United States, 874 F.3d 1341, 1347 (Fed. Cir. 2017) (“[T]he Release
cannot be enforced against a claim for breach of the underlying contract.”). In short, the
government cannot argue the Step 8 option allows TMA to avoid performing a proper
calculation.

        In addition to express risk allocation, the government argues the DPP Contract
structurally or impliedly allocated risk of radiology data discrepancies to plaintiffs. See Def.’s
MSJ at 37. Even if risk is not expressly allocated to one party, risk may still be attributed to a
party for “conscious ignorance” when “he was not only so aware that his knowledge was limited
but undertook to perform in the face of that awareness[.]” Restatement (Second) of Contracts,
§ 154 cmt. c (Am. L. Inst. 1981). In Metcalf Construction Co., the Federal Circuit ruled a
contractor failed to establish liability in its suit alleging the Navy breached its duty of good faith
and fair dealing under a contract to design and build military housing. 742 F.3d at 997. The
contractor did not “bear the risk of significant errors in the pre-contract assertions by the
government about the subsurface site conditions” even when the contract required the contractor
to conduct an independent investigation upon award. Id. at 995–96. Conversely, to the extent
plaintiffs rely on assumptions when contracting with the government, it is “incumbent upon the
plaintiffs to investigate those issues before entering into the contract.” ConocoPhillips, 501 F.3d
at 1380. In ConocoPhillips, the plaintiffs entered multiple contracts “contain[ing] an economic
price adjustment clause that caused the contract price to be adjusted each month based on a
publication known as the Petroleum Marketing Monthly (‘PMM’).” Id. at 1376. The plaintiffs
argued reformation of the contracts was necessary because “they did not appreciate the way in
which the price changes reported by the PMM could differ from price changes reported by other
sources of market information.” Id. at 1379–80. The Federal Circuit held “[t]o the extent the
plaintiffs thought that the PMM tracked other market publications more closely than it did,” they
should have gathered more information before entering the contracts. Id. at 1380.
ConocoPhillips is distinguishable from this case as plaintiffs are not asserting they relied on their
own assumptions but rather plaintiffs relied on TMA’s express contractual duty to extract,
analyze, and adjust TMA’s data according to the DPP Contract. See ConocoPhillips, 501 F.3d at
1380; supra Section IV.B. The government also admits the Federal Circuit in ConocoPhillips
did not discuss risk-shifting in the breach of contract analysis section. Tr. at 87:7–9 (“THE

                                                - 33 -
COURT: . . . [D]oes Conoco discuss risk in the breach of contract section? [THE
GOVERNMENT]: No[.]”). In this case, as TMA expressly promised to use its data for the
adjustments, plaintiffs cannot impliedly bear the risk of the government’s “pre-contract
assertions” even though Step 8 gives plaintiffs a thirty-day option window to question the
government’s written response, akin to offering a contractor an opportunity to perform a site
visit. See Metcalf Constr. Co., 742 F.3d at 995–96.

        As TMA had an express duty it admittedly failed to perform, this case is distinguishable
from Lakeshore regarding express allocation of risk and from Conoco regarding implied
allocation of risk. The Court accordingly finds the government has not met its burden of
showing it is “entitled to judgment as a matter of law” for whether plaintiffs bore the risk as to
the government’s breach of its contractual duty to extract, analyze, and adjust radiology data
from TMA’s database. Anderson, 477 U.S. at 247; see Lakeshore, 748 F.3d at 1348; Metcalf
Constr. Co., 742 F.3d at 990–91; ConocoPhillips, 501 F.3d at 1380.

        F.       Conclusion

        As the Court finds TMA was not obligated to perform what plaintiffs argue was TMA’s
contractual duty to extract and adjust the hospitals’ data, the Court accordingly grants in part the
government’s motion for summary judgment as to plaintiffs’ breach of contract claim regarding
TMA’s contractual duty to extract and adjust the hospitals’ data. See supra Section IV.A. As
the government, however, admits TMA failed to meet what plaintiffs assert was TMA’s
contractual duty to extract, analyze, and adjust radiology claims data from TMA’s database, and
as the government has not met its burden of proving any breach of contract defenses, the Court
accordingly denies in part the government’s motion for summary judgment as to plaintiffs’
breach of contract claim regarding TMA’s contractual duty to extract, analyze, and adjust
radiology claims data from TMA’s database. See supra Sections IV.B, D. As the government
admits TMA failed to meet what plaintiffs assert was TMA’s contractual duty to extract, analyze,
and adjust radiology claims data for an alternative zip code for plaintiff Integris Baptist, the
Court accordingly denies in part the government’s motion for summary judgment as to plaintiffs’
breach of contract claim regarding TMA’s contractual duty to extract, analyze, and adjust
radiology claims data for the five line items under Integris Baptist’s alternative zip code. 15 See
supra Section IV.C.

V.      Analysis of Plaintiffs’ Mutual Mistake of Fact Claim

        The Restatement (Second) of Contracts Section 152, titled “When Mistake of Both
Parties Makes a Contract Voidable” (the “mutual mistake” doctrine), provides:

        (1) Where a mistake of both parties at the time a contract was made as to a basic
            assumption on which the contract was made has a material effect on the agreed
            exchange of performances, the contract is voidable by the adversely affected
            party unless he bears the risk of the mistake under the rule stated in § 154.

15
   Plaintiffs did not cross-move for summary judgment, so the Court only decides the government’s motion for
summary judgment.

                                                     - 34 -
       (2) In determining whether the mistake has a material effect on the agreed
           exchange of performances, account is taken of any relief by way of
           reformation, restitution, or otherwise.

(Am. L. Inst. 1981). The classic illustration of a mutual mistake is: “A contracts to sell and B to
buy a tract of land, the value of which has depended mainly on the timber on it. Both A and B
believe that the timber is still there, but in fact it has been destroyed by fire. The contract is
voidable by B.” § 152, illus. 1. The Federal Circuit in Atlas Corp. v. United States provided the
standard for a mutual mistake of fact claim:

       A party seeking to state a claim for reformation of a contract under the doctrine of
       mutual mistake must allege four elements:

       (1) the parties to the contract were mistaken in their belief regarding a fact;
       (2) that mistaken belief constituted a basic assumption underlying the contract;
       (3) the mistake had a material effect on the bargain; and
       (4) the contract did not put the risk of the mistake on the party seeking reformation.

895 F.2d 745, 750 (Fed. Cir. 1990).

        Plaintiffs aver the mutual mistake issue is whether specific categories, including facility
charges, were correctly paid before the DPP. See Tr. at 166:4–8. To frame the mutual mistake
issue, the Court notes plaintiffs clarified at oral argument their only allegation of mutual mistake
is whether 32 C.F.R. § 199.14(a)(5)(xi) requires TMA to reimburse plaintiffs for outpatient
service “facility charges.” Tr. at 137:3–7 (“THE COURT: . . . [T]he parties’ disagreement is
whether the agency’s mandate was to provide facility charges over the 199.14 enumerated
outpatient services, correct? [PLAINTIFFS]: Correct.”), 147:18–24 (“[PLAINTIFFS]: . . .
[T]he DPP represents that prior payments had been made in accordance with Medicare
principles. . . . The mistake was that the hospitals believed that proper facility charge payments
had already been made.”). Plaintiffs further clarified regarding radiology data and calculations
per the DPP Contract—plaintiffs’ breach of contract claim—they “do not allege (and do not need
to allege) ‘mistakes’ in the calculations, and do not seek reformation of the DPP on that basis.”
Pls. MSJ Resp. at 38. Plaintiffs do not allege a mutual mistake of fact regarding dump codes,
either. See Tr. at 63:14–20 (“[PLAINTIFFS]: Well, I think that the government was aware the
dump codes were a problem. I think the government had knowledge of that and failed to
disclose that knowledge as part of the DPP. THE COURT: So there was no mistake of fact; the
government knew about it? [PLAINTIFFS]: Correct[.]”). Notably, other than facility charges
under § 199.14(a)(5)(xi), plaintiffs do not claim a mutual mistake of fact regarding general
underpayment in relation to Medicare principles. Tr. at 138:6–9 (“THE COURT: . . . [O]ther
than the 199.14 payment of facilities charges . . . is there any other mutual mistake of fact?
[PLAINTIFFS]: No[.]”), 207:9–16 (“THE COURT: If zero dollars are due under (xi), is there
still underpayment? [PLAINTIFFS]: “I don’t believe that there would be underpayment, at least
in the way we formulated our claims for those other categories of outpatient services.”). The
Court accordingly need only analyze whether the parties were mutually mistaken as to the
interpretation of § 199.14(a)(5)(xi).

                                               - 35 -
       A.      Whether the Parties Were Mistaken in Their Belief Regarding a Fact

        The first element of the mutual mistake standard requires “the parties to the contract [to
be] mistaken in their belief regarding a fact[.]” Atlas Corp., 895 F.2d at 750. “An erroneous
mutual belief about the contents of a written agreement is sufficient to constitute a ‘mistake’ for
this purpose: reformation is available when the parties, having reached an agreement and having
attempted to reduce it to writing, fail to express it correctly in the writing.” Nat’l Australia Bank
v. United States, 452 F.3d 1321, 1329 (Fed. Cir. 2006) (cleaned up). “Reformation is not a
proper remedy for the enforcement of terms to which the defendant never assented; it is a remedy
the purpose of which is to make a mistaken writing conform to antecedent expressions on which
the parties agreed.” Atlas Corp., 895 F.2d at 750 (quoting 3 Corbin on Contracts § 614 at 723
(1960)).

        The government contends reformation of a contract based on mutual mistake is
“extraordinary relief” which “is not legally available under the circumstances of this case,
because TMA considered, and disclaimed at the time of contract formation, any intention to
provide hospitals with a markup for hospital overhead through the [DPP] in the first place.”
Def.’s MSJ at 45–46. The government argues the DPP Contract “stat[ed] unequivocally that
‘[a]ny interpretation [of] the regulation provision that facility charges were to be paid on all
hospital outpatient services in addition to the allowable charge authorized for specified
outpatient services is unsupportable.’” Id. at 53 (quoting DPP Contract Notice at A5). In other
words, the government argues the contract “cannot now be ‘reformed’ to create a contract
obligation that DoD explicitly refused to offer.” Id. The government concludes “[t]here is no
aspect of plaintiffs’ ‘mutual mistake’ that is legally viable, and, as such, the Government is
entitled to summary judgment in its favor.” Id. at 71.

        Plaintiffs argue courts “frequently use the power of a court of equity to reform contracts
so that they conform to the intention of the parties.” Pls.’ MSJ Resp. at 45 (quoting Nippon
Hodo Co. v. United States, 160 F. Supp. 501, 502 (Ct. Cl. 1958)) (cleaned up). Plaintiffs assert
“the Parties made a mutual mistake by believing that the Government had reimbursed Plaintiffs
for facility charges for all categories of outpatient reimbursement services.” Id. Plaintiffs argue
“[t]he Government offered to pay hospitals the amounts it owed them, but only for outpatient
radiology services, and only as quantified by the Kennell Study.” Id. at 46 (citing DPP Contract
Letter at A1–A2; DPP Contract Notice at A3–A9). TMA, plaintiffs argue, “affirmatively and
unambiguously represented in the DPP that radiology was the only underpaid outpatient
service.” Id. (citing DPP Contract Notice at A6; DPP Contract FAQs at A12–A13). Further,
plaintiffs claim “the DPP failed to reflect anywhere that facility charges were not factored into
payments,” and “[t]hus, radiology was not the only underpaid outpatient service[.]” Id.

        The 1990 Federal Circuit case Atlas Corp. concerned contracts with the government to
produce uranium and offers an analytical framework for determining proper reformation of a
contract. 895 F.2d at 750. Although the Federal Circuit found no mutual mistake in Atlas Corp.,
the court recognized reformation would be appropriate where “the parties recognize the existence
of a fact about which they could negotiate” and “they mutually form a belief concerning that
fact, but their belief is erroneous.” Id. (finding no mutual mistake and so no contract reformation
because “[t]he parties could not have formed a mutually mistaken belief concerning a fact whose

                                               - 36 -
existence they could not recognize”). In Atlas Corp., the Federal Circuit listed several cases
where courts did permit reformation of contracts. See id. at 751 (citing Sw. Welding & Mfg. Co.
v. United States, 373 F.2d 982, 990 (Ct. Cl. 1967) (the parties mistakenly believed the price of
steel was lower than it actually was); Walsh v. United States, 102 F. Supp. 589 (Ct. Cl. 1952)
(the parties erroneously believed the minimum wage rate was a certain amount, even though it
had increased earlier); Aluminum Co. of Am. v. Essex Grp., Inc., 499 F. Supp. 53 (W.D. Pa.
1980) (the parties erroneously believed the Wholesale Price Index would accurately represent
nonlabor production costs for the purpose of a contractual escalation clause)); see also
Bowen–McLaughlin–York Co. v. United States, 813 F.2d 1221 (Fed. Cir. 1987) (reformation
permitted where the parties erroneously omitted certain price items which existed and could have
been included in the contract). The Court of Claims also reformed a contract in National Presto
Industries, Inc. v. United States where plaintiff contractor entered a contract with the
government, but neither party knew at the time of negotiations the step they had cut to save costs
would end up being necessary. 338 F.2d 99 (Ct. Cl. 1964). The Federal Circuit in Atlas Corp.
discussed National Presto Industries, stating, “Although the parties did not know of the need for
the additional equipment, they clearly recognized that the equipment might be needed. . . .
Therefore, there was a mutual mistake[.]” Atlas Corp., 895 F.2d at 751 (citation omitted) (citing
Nat’l Presto Indus., 338 F.2d at 107).

        At oral argument, the parties admitted they are unsure whether the Atlas Corp.
mutual-mistake-of-fact standard requires the parties share the same mistaken belief, although the
government added it has not “seen a case where the actual mistaken belief was not the same.”
Tr. at 135:23–136:21. The government stated, “[A]t a minimum, the parties have to share the
same intention.” Tr. at 136:7–8. Indeed, the first element of a mutual mistake claim requires
“the parties recognize the existence of a fact about which they could negotiate,” and “they
mutually form a belief concerning that fact, but their belief is erroneous.” Atlas Corp., 895 F.2d
at 750. The exemplary mutual mistake cases cited by the Federal Circuit in Atlas Corp. involved
parties sharing the same belief. See e.g., Sw. Welding & Mfg. Co., 373 F.2d at 991; Walsh, 102
F. Supp. at 591; Aluminum Co. of Am., 499 F. Supp. at 69–70. The parties further would have
assented to the deal had they been aware of the truth regarding the fact, and thus, reformation
was a viable option. See Atlas Corp., 895 F.2d at 751 (“Other cases in which courts have
permitted reformation of contracts similarly show that the parties held an erroneous belief
concerning a fact whose existence the parties recognized and about which they could reach
agreement.”).

        The Court accordingly must determine whether the parties shared a mistaken belief.
Plaintiffs argue the regulation mandates TMA reimburse facility charges under 32 C.F.R.
§ 199(a)(5)(xi) for all outpatient services, whereas TMA expressly stated in the DPP Contract
“[a]ny interpretation [of] the regulation provision that facility charges were to be paid on all
hospital outpatient services in addition to the allowable charge authorized for specific outpatient
services is unsupportable.” DPP Contract Notice at A5. As the parties’ beliefs on the
interpretation of the regulation are diametrically opposed, the Court does not find the parties
“mutually form[ed] a belief concerning [a] fact[.]” Atlas Corp., 895 F.2d at 750–51; see Nat’l
Australia Bank, 452 F.3d at 1329. Further, as the parties entirely disagreed on the interpretation
of the regulation when they entered the DPP Contract, plaintiffs in this case cannot contend the
parties “reached an agreement[,] . . . attempted to reduce it to writing, [and] fail[ed] to express it

                                                - 37 -
correctly in the writing.” Nat’l Australia Bank, 452 F.3d at 1329 (internal quotations omitted);
see also Am. President Lines, Ltd. v. United States, 821 F.2d 1571, 1582 (Fed. Cir. 1987) (“The
purpose and function of the reformation of a contract is to make it reflect the true agreement of
the parties on which there was a meeting of the minds.”).

        “Reformation is not a proper remedy for the enforcement of terms to which the defendant
never assented; it is a remedy the purpose of which is to make a mistaken writing conform to
antecedent expressions on which the parties agreed.” Atlas Corp., 895 F.2d at 750. The
government, however, never assented to making facility charge payments atop other payments
for outpatient services; the government in fact argues the opposite. Tr. at 143:21–23 (“[THE
GOVERNMENT]: . . . [Plaintiffs] contend, and we disagree, . . . there’s a facility charge
payment due on top of the CMAC.”). The government states, “TMA expressly rejected the
option of offering hospitals an overhead markup on top of the reimbursement amounts[.]” Def.’s
MSJ Reply at 43 (citing DPP Contract Notice at A5). This express rejection in the DPP states,
“[A]ll categories of hospital outpatient services paid in accordance with the specific terms of
199.14(a)(5)(i) through (x) received the correct payment under the TRICARE regulation and are
not entitled to an additional ‘facility charge’ under paragraph (xi).” DPP Contract Notice at A5.
This DPP language expresses TMA’s intention of not paying additional facility charges atop
payments for various outpatient services. Id. Further, when asked at oral argument how the DPP
Contract dealt with facility charges, plaintiffs responded, “[F]acility charge payments were not
offered as part of the DPP.” Tr. at 147:8–11, 147:20–22 (“[PLAINTIFFS]: . . . [T]he DPP
represents that no additional facility charge payment is necessary.”). The government added
“[t]here [are] no documents or government witness testimony to suggest that the government was
mistaken factually about the way that these matters are reimbursed.” Tr. at 165:16–19.

        The parties disagree on the interpretation of the statute relative to facility charges such
that the Court cannot hold they had a meeting of the minds on this issue. Compare Pls.’ MSJ
Resp. at 41 (“Section 199.14(a)(5) provides that the Government must reimburse Plaintiffs for
twelve categories of outpatient hospital services, including facility charges.”), with Def.’s MSJ
Reply at 51 (quoting Pls.’ MSJ Resp. at 5, 54–55) (the government rejects plaintiffs’ claim
“TMA admitted . . . the ‘facility charge’ provision of 32 C.F.R. § 199.14(a)(5) was intended to
provide for a markup for hospital overhead on top of reimbursements otherwise paid as described
in the regulation, and is now taking a supposedly contrary ‘convenient litigating position[.]’”).
Without a meeting of the minds, the parties cannot have mutually come to a mistaken belief.

        Against the government’s argument TMA “considered and disclaimed . . . any intention
to provide hospitals with a markup for hospital overhead[,]” plaintiffs argue, “the DPP’s central
purpose was to reimburse hospitals for any outpatient category where the hospitals were paid less
than they should have been paid when applying Medicare fair payment principles.” Pls.’ MSJ
Resp. at 49. Plaintiffs emphasize “the Notice states that all categories of hospital outpatient
services paid pursuant to 1991.4(a)(5)(i) [sic] through (x) ‘are not entitled to an additional
“facility charge” under paragraph (xi).’” Id. (quoting DPP Contract Notice at A5). Plaintiffs
argue this “explanation thus suggests that [the government incorrectly believed] facility charges
were already appropriately included in the payments pursuant to the regulation.” Id.

                                              - 38 -
        At oral argument, the government stated the general purpose of the contract was to “bring
closure to any concerns regarding payment of hospital outpatient services under the TRICARE
regulation, prior to the implementation of OPPS.” Tr. at 145:10–14 (quoting DPP Contract
Letter at A1–A2). Plaintiffs contended “the purpose of the DPP was to provide payment to the
hospitals that was consistent with . . . the requirements of the regulation and the statute.” Tr. at
234:10–12. In response to plaintiffs’ appeal to “equity” and the “spirit and purpose” of the DPP
as grounds for reformation, the government argues “plaintiffs misapprehend the spirit and central
purpose of the [DPP,]” which “was to settle definitively outstanding disputes between the parties
that had arisen in connection with the interpretation of 32 C.F.R. § 199.14(a)(5) and a supposed
difference between levels of reimbursement for outpatient services between Medicare and
TRICARE.” Def.’s MSJ Reply at 43. To determine the parties’ intent, the Court looks to the
plain language of “the contract itself.” Greco v. Dep’t of the Army, 852 F.2d 558, 560 (Fed. Cir.
1988); see CITGO Asphalt Refin. Co. v. Frescati Shipping Co., 140 S. Ct. 1081, 1088 (2020)
(“[T]he parties’ intent ‘can be determined from the face of the agreement’ and ‘the language that
they used to memorialize [that] agreement.’”). Plaintiffs’ characterization of the general purpose
of the DPP Contract to argue TMA would have consented to paying facility charges conflicts
with the plain terms of the DPP Contract: “The intent and effect of the regulation provision for
reimbursement of facility charges was to pay all other hospital outpatient services not
specifically listed in the regulation provision with a stated allowable charge methodology based
on billed charges.” DPP Contract Notice at A5. The government was not mistaken in the DPP
regarding whether facility charges needed adjustment because they expressly excluded facility
charges from the scope of consideration. See id.

        The remedy for mutual mistake of fact is to reform the contract—in this case, the DPP
Contract. The Court is, however, unable to reform the DPP Contract in a way which does not
“reflect the true agreement of the parties on which there was a meeting of the minds.” Am.
President Lines, Ltd., 821 F.2d at 1582. As the parties did not “mutually form a belief
concerning [a] fact,” and as TMA did not assent to reimbursing plaintiffs’ facility charges as
plaintiffs request, the Court finds plaintiffs’ claim fails the first element of a mutual mistake of
fact claim. 16 Atlas Corp., 895 F.2d at 750; see Nat’l Australia Bank, 452 F.3d at 1329; Am.
President Lines, Ltd., 821 F.2d at 1582. 17 As plaintiffs failed to satisfy the first element of a
mutual mistake claim, the Court accordingly grants the government’s motion for summary
judgment as to plaintiffs’ mutual mistake of fact claim. See Atlas Corp., 895 F.2d at 750 (“A
party seeking to state a claim for reformation of a contract under the doctrine of mutual mistake
must allege four elements[.]”). Although the Court finds plaintiffs failed to satisfy a necessary

16
   In dicta in Northern Michigan Hospitals, Inc. v. Health Net Federal Services, LLC, a related case preceding the
present action discussed supra Section I.A, the Third Circuit provided if “the dispute at issue is not a purely legal
one, but rather requires factual determinations[,]” such as applying the TRICARE regulations to the Hospitals’
specific claims for reimbursement, “what is required by the underlying dispute . . . is an application of the
TRICARE regulations to the Hospitals’ specific claims for reimbursement.” 344 F. App’x 731, 737 (3d Cir. 2009).
After the Third Circuit affirmed the dismissal of Northern Michigan Hospitals’ claim, the parties in this case entered
the DPP Contracts instead of pursuing their “implied in fact and breach of quasi-contract/unjust enrichment” claims
in the Third Circuit case. Id. at 735. Further, during oral argument on 9 June 2022, both parties confirmed there are
no disputes of material fact on the issues of TMA’s duties under the contract and whether there was a mutual
mistake of fact. Tr. at 78:11–19.
17
   As the Court finds plaintiffs’ claim fails the first element of a mutual mistake of fact claim, the Court need not
consider the parties’ arguments regarding whether TMA’s interpretation of 32 C.F.R. § 199.14(a)(5)(xi) was correct,
including evaluation of the Kisor deference factors.

                                                       - 39 -
element of their mutual mistake of fact claim, the Court nonetheless analyzes the other three
elements in the alternative.

       B.      Whether the Mistaken Belief Constituted a Basic Assumption Underlying the
               Contract

        For a mutual mistake of fact claim to succeed, the mistaken belief must have “constituted
a basic assumption underlying the contract[.]” Id. This element presupposes proving a mistake
under element one of the Atlas Corp. analysis. Because the Court finds there was no mistake, no
mistake could have constituted a basic assumption underlying the contract. Plaintiffs’ claim
accordingly fails element two of the Atlas Corp. analysis. Id.; see supra Section V.A.

       C.      Whether the Mistake had a Material Effect on the Bargain

        A party asserting a mutual mistake of fact must show the mistaken belief “had a material
effect on the bargain[.]” Atlas Corp., 895 F.2d at 750. This element is contingent on finding a
mistaken fact per element one of the Atlas Corp. analysis. Because the Court finds there was no
mistake, no mistake could have had a material effect on the bargain. Plaintiffs’ claim
accordingly fails element three of the Atlas Corp. analysis. Id.; see supra Section V.A.

       D.      Whether Plaintiffs Bore the Risk of Mistake

        Element four of the Atlas Corp. analysis requires plaintiffs show “the contract did not put
the risk of the mistake on [them].” Atlas Corp., 895 F.2d at 750. The Court finds there was no
mistake sufficient to satisfy element one of the Atlas Corp. analysis, and thus the Court need not
address Atlas Corp. element four. See id. Assuming in the alternative plaintiffs’ claim “DoD
and Class Members had been parties to a mutual mistake because, contrary to DoD’s
representations in the contract documents, radiology was not the only outpatient service that
TRICARE underpaid” was true, and there was a mutual mistake of fact as to the underpayment
of non-radiology outpatient services, the Court analyzes whether plaintiffs bore the risk of the
mistake. Pls.’ Class Cert. at 15; see Atlas Corp., 895 F.2d at 750.

       Restatement (Second) of Contracts Section 154 provides:

       A party bears the risk of a mistake when

               (a) the risk is allocated to him by agreement of the parties, or
               (b) he is aware, at the time the contract is made, that he has only limited
               knowledge with respect to the facts to which the mistake relates but treats
               his limited knowledge as sufficient, or
               (c) the risk is allocated to him by the court on the ground that it is reasonable
               in the circumstances to do so.

In Harbor Insurance Co. v. Stokes, the DC Circuit stated “[i]n the comments to § 154(b), the
Restatement reformulates treating ‘limited knowledge as sufficient’ as ‘conscious ignorance[.]’”

                                                - 40 -
45 F.3d 499, 502 (D.C. Cir. 1995) (citing Restatement (Second) of Contracts § 154 cmt. c. (Am.
L. Inst. 1981)). The Restatement reads:

         c. Conscious ignorance. Even though the mistaken party did not agree to bear the
         risk, he may have been aware when he made the contract that his knowledge with
         respect to the facts to which the mistake relates was limited. If he was not only so
         aware that his knowledge was limited but undertook to perform in the face of that
         awareness, he bears the risk of the mistake. It is sometimes said in such a situation
         that, in a sense, there was not mistake but “conscious ignorance.”

§ 154 cmt. c. Commenting on the scope of “conscious ignorance,” the court stated, “The
Restatement has quite logically set ‘conscious ignorance’ in a section explicitly addressing risk
allocation.” Harbor Ins. Co., 45 F.3d at 502.

          The government argues “a party bears the risk of a mistake when [it] is aware, at the time
the contract is made, that it has only limited knowledge with respect to the facts which the
mistake relates but treats that limited knowledge as sufficient.” Def.’s MSJ at 47 (citing
ConocoPhillips v. United States, 501 F.3d 1374, 1380 (Fed. Cir. 2007)). 18 The government
argues “‘[e]very time parties enter into a contract, they act with incomplete information[,]’” and
“[t]herefore, ‘[w]here [the parties] have been explicitly concerned about an issue, but decide to
press forward without further inquiry or explicit provision, it is reasonable to suppose that they
intend the contract to dispose of the risk in question, i.e., to bar any reopening at the behest of the
party who, it turns out, would have done better without the contract.” Id. at 48 (quoting Harbor
Ins. Co., 45 F.3d at 502). As an initial matter for the government’s risk-bearing argument, the
government admits Step 8 of the DPP, which in pertinent part reads, “[t]he response will provide
the calculated discretionary adjusted payment and the calculations from which the adjustment
was derived[,]” applies to “radiology only[,]” so the government argues its “position is that the
imposition of the risk of mistake occurs . . . by operation of law, as a result of [plaintiffs’]
conscious choice to proceed and go forward on the basis of limited knowledge.” DPP Contract
Notice at A9; Tr. at 211:4–23. The government argues because the contract was “consciously
considered,” the resulting contractual relationship is not a mistake, but rather “awareness
of . . . uncertainty[.]” Def.’s MSJ at 48 (quoting Loral Corp. v. United States, 434 F.2d 1328,
1331 (Ct. Cl. 1970)).

        To support their contention that they did not bear the risk of errors, plaintiffs cite Metcalf
Construction Co., stating: “In Metcalf Construction Co., the Government made representations
to the plaintiff in its pre-contract requests and questions-and-answers, and the plaintiff later sued
the Government for breach of contract.” Pls.’ MSJ Resp. at 37 (quoting Metcalf Constr. Co. v.
United States, 742 F.3d 984, 996 (Fed. Cir. 2014)).

18
  The plaintiffs in ConocoPhillips, discussed supra Section IV.E.2, argued their contracts should be reformed based
on mutual mistake because “when they entered into the contracts they believed that the [Petroleum Marketing
Monthly (‘PMM’)] accurately reflected market prices, and they did not appreciate the way in which the price
changes reported by the PMM could differ from price changes reported by other sources of market information.”
501 F.3d at 1379–80. The contracts were, however “very clear about the price that [would] be paid to the contractor
and how that price [would] be adjusted.” Id. at 1380. The Federal Circuit held “[t]o the extent the plaintiffs thought
that the PMM tracked other market publications more closely than it did . . . it was incumbent upon the plaintiffs to
investigate those issues before entering into the contract.” Id. (citing Restatement (Second) of Contracts § 154(b)).

                                                       - 41 -
       The court held that nothing in the contract “expressly or implicitly warned Metcalf
       that it could not rely on, and that instead it bore the risk of error in, the government’s
       affirmative representations . . . . The natural meaning of the representations was
       that, while Metcalf would investigate conditions once the work began, it did not
       bear the risk of significant errors in the pre-contract assertions by the
       government[.]”

Id. (quoting Metcalf Constr. Co., 742 F.3d at 995–96).

         The government asserts plaintiffs incorrectly view “the fact that TMA provided them
with limited information, particularly as to the [Kennell] studies, during the settlement process,
[as] effectively mak[ing] TMA their insurer[.]” Def.’s MSJ at 50. Plaintiffs had other options,
according to the government, but chose to proceed with “conscious ignorance” instead. Id. at
50–51. For example, the government contends plaintiffs could have “avail[ed] themselves of the
FAQ process to obtain additional information[,]” “attempt[ed] to negotiate contract terms that
were more protective of their interests in light of the limited information TMA had provided[,]”
“walk[ed] away from the proposed arrangement entirely,” or resolved to litigate. Id. at 51
(emphasis removed). Instead, the government emphasizes, “in the face of their limited
knowledge, [plaintiffs] made the conscious choice to press forward with the deal without
alteration, and they chose to compromise their unadjudicated legal claims, electing the certainty
of settlement over the uncertainty of litigation.” Id.

        The government further notes a “party who has made inquiries that have gone
unanswered fails to exercise due diligence and assumes the risk of mistake if it executes a
contract notwithstanding its lack of knowledge.” Id. at 51–52 (citing CanPro Invs. Ltd. v. United
States, 130 Fed. Cl. 320, 342 (2017) (finding “[plaintiff]’s execution of the lease in light of its
admitted lack of knowledge concerning what it deems a ‘basic assumption’ regarding the lease
constitutes a failure to exercise due diligence and thus places the risk of a mistake resulting from
such lack of knowledge squarely on [plaintiff].” (citation omitted))). Plaintiffs “did not even
make inquiries before executing the contract[,]” according to the government. Id. at 52. The
government summarizes: “The fact that plaintiffs were contacted years later by a law firm, and
now regret the decision that they made on limited knowledge in 2011 to accept the terms of
TMA’s settlement offer, is not a circumstance that now enables them to reform their contract.”
Id. (footnote omitted). In response to plaintiffs’ contention there was no express allocation of
risk to plaintiffs, the government argues “the risk of mistake may shift in ways other than
through express contract provisions.” Def.’s MSJ Reply at 39.

        Plaintiffs assert “[t]o allocate the risk of a mutual mistake to a particular party, there must
be ‘an agreement explicitly reached or implied from customary practice, as to who should bear
the risk of mistake.’” Pls.’ MSJ Resp. at 50 (quoting Burnside-Ott Aviation Training Ctr., Inc. v.
United States, 985 F.2d 1574, 1582 (Fed. Cir. 1993)). Plaintiffs state: “In Burnside-Ott Aviation
Training Ctr., Inc., for example, the court denied the Government summary judgment’s [sic]
motion against the Plaintiffs’ mutual mistake claim[,]” determining because “the contract does
not say ‘anything about which party to a government contract bears the risk of misclassification
of service employees . . .further [sic] examination is needed to determine whether the parties had

                                                 - 42 -
an agreement, explicitly reached or implied from customary practice, as to who should bear the
risk of mistake.’” Id. (quoting Burnside-Ott Aviation Training Ctr., Inc., 985 F.2d at 1582).
Similarly, plaintiffs cite S.A. Healy Co. v. United States, noting in that case “the Government
argued that the following contract provision allocated the risk of insufficient appropriations (the
relevant risk in this case) to the plaintiff: ‘The contractor is also cautioned that the prosecution
of the work at a rate that will exhaust the funds reserved before the end of the fiscal year will be
at his own risk.’” Id. at 50–51 (quoting 576 F.2d 299, 304–05 (Ct. Cl. 1978)). In S.A. Healy
Co., plaintiffs argue, “[t]he court determined that the ‘clause as a whole is not sufficient to shift
this burden to the contractor when the administrative agency is at least partly to blame for the
funds shortage.’” Id. at 51 (quoting 576 F.2d at 304–05). Plaintiffs contrast S.A. Healy Co. with
this case, asserting “the Parties did not enter into any agreement regarding who would bear the
risks of the mistake[,]” and the government’s arguments fail because “there was not a single
provision or disclaimer in the DPP that expressly or implicitly warned Plaintiffs that [they] could
not rely on [the] Government’s affirmative representations, and that Plaintiffs bore the risk of
error.” Id. Plaintiffs also cite National Presto Industries as instructive. Id. at 52. In National
Presto Industries, Inc. v. United States, the plaintiff entered a contract containing “no disclaimers
of Government liability or warranties by the plaintiff” with the Ordnance Department of the
Army “for the commercial production of 105-millimeter artillery shells.” 338 F.2d 99, 101, 109
(Ct. Cl. 1964). The 1964 Court of Claims found although the plaintiff was an “active partner” in
the process, “this was not a performance contract; plaintiff was not an expert, promising to
perform and taking the whole risk and anxiety of the project off the Government’s shoulders.”
Id. at 109. Plaintiffs contend even if they were “active partners” in the DPP, the government was
the reason for plaintiffs’ limited knowledge, so the risk remains with the government. Pls.’ MSJ
Resp. at 52–53. Plaintiffs note like the National Presto Industries contract, the DPP Contract
“did not contain any disclaimers of Government liability or any warranties by the Plaintiffs.” Id.
at 53.

        The government notes “in the Burnside-Ott case cited by the plaintiffs, the Federal
Circuit reversed a grant of summary judgment because . . . ‘further examination is needed to
determine whether the parties had an agreement, explicitly reached or implied from customary
practice, as to who should bear the risk of mistake.’” Def.’s MSJ Reply at 39–40 (quoting
Burnside-Ott Aviation Training Ctr., Inc., 985 F.2d at 1582). In response to plaintiffs’ use of
S.A. Healy Co., the government argues “[t]he court in that case had no occasion to consider
whether, and under what conditions, risk shifting occurs by operation of law outside of
circumstances where there is an express contract provision, because the only task before the
court was to interpret the provision in question.” Id. at 40 (citing S.A. Healy Co., 576 F.2d at
304–05). The government also distinguishes National Presto Industries, stating it “does not
stand for the proposition that the risk of mistake cannot shift in the absence of an express
contract provision.” Id. Although the court acknowledged the absence of disclaimers and
warranties in the particular contract at issue as part of its analysis, the government asserts “the
Claims Court’s determination that the risk of mistake did not shift to the contractor was based
upon the fact that the overall dealings between the parties—not just the contract
provisions—established that the contractual relationship at issue was that of a ‘joint enterprise’
pioneering a new technology.” Id. at 40–41 (citing Nat’l Presto Indus., Inc., 338 F.2d at 109).

                                               - 43 -
         This court has found “a party ‘cannot rely upon a mutual mistake of fact to avoid
enforcement of a contract where . . . the “mistake” is a result of that party’s failure to exercise
due diligence.’” CanPro Invs. Ltd., 130 Fed. Cl. at 342 (quoting Griffin & Griffin Expl., LLC v.
United States, 116 Fed. Cl. 163, 175 (2014)). In CanPro, the plaintiff alleged it reasonably
relied on the government to provide all material information relating to the lease, and it “never
received the information it requested and that it knew was needed to develop an informed belief
concerning the [issue], but that it nonetheless executed the lease.” Id. This court found
“[plaintiff]’s execution of the lease in light of its admitted lack of knowledge . . . constitutes a
failure to exercise due diligence and thus places the risk of a mistake resulting from such lack of
knowledge squarely on [plaintiff].” Id. This court held “‘[i]gnorance is never sufficient to
constitute a ground of relief if it appears that the requisite knowledge might have been obtained
by reasonable diligence.’” Id. (quoting Griffin & Griffin Expl., LLC, 116 Fed. Cl. at 175).

         In this case, plaintiffs signed the DPP knowing “facility charge payments were not
offered as part of the DPP.” Tr. at 147:8–11, 147:20–22 (“[PLAINTIFFS:] . . . [T]he DPP
represents that no additional facility charge payment is necessary.”). Plaintiffs asserted at oral
argument “they were reasonably . . . relying upon what the DPP said.” Tr. at 178:6–7. When the
Court asked, “Did the plaintiffs inquire as to the government’s stating that it [did] correctly
reimburse for non-radiology claims?” plaintiffs responded, “I’m not sure whether
any . . . potential plaintiffs did. I’m not aware of the named plaintiffs having done that. No.”
Tr. at 178:4–13. Although plaintiffs admit they did not exercise due diligence to determine
whether they were correctly reimbursed for non-radiology outpatient services, plaintiffs
nonetheless signed the DPP. See Def.’s MSJ App. at A19 (Ingham Regional Medical Center),
A21 (Integris Baptist Regional), A23 (Integris Bass Baptist), A25 (Integris Grove Hospital), A27
(Integris Baptist Medical), A29 (Integris Canadian Valley). Plaintiffs also admit when they
signed the DPP they had not seen the Kennell Study underlying TMA’s analysis of outpatient
service reimbursements. Pls.’ MSJ Resp. at 52 (“[T]he Government refused to provide Plaintiffs
with a copy of the Kennell Study until years later, in 2013, after Plaintiffs had made multiple
attempts and FOIA requests to obtain it.”). Plaintiffs accordingly concede they signed the DPP
Contract despite their “limited knowledge.” Id.; see ConocoPhillips, 501 F.3d at 1380
(determining “it cannot be said that either party could have been mistaken” as to the calculation
method imagined by the contract). By agreeing to the DPP’s terms despite admitting they “ha[d]
only limited knowledge with respect to the facts to which the mistake relates[,]” plaintiffs
“b[ore] the risk of [the] mistake” they now allege. Restatement (Second) of Contracts § 154(b);
see ConocoPhillips, 501 F.3d at 1380 (holding contractors bore risk of investigating the
calculation method before entering contract).

        Plaintiffs signed the DPP knowing they had limited knowledge regarding the facts
underlying the alleged mistake, thus plaintiffs failed to “exercise due diligence[,]” and so the risk
of any mistake “resulting from such lack of knowledge [is placed] squarely on” plaintiffs.
CanPro Invs. Ltd., 130 Fed. Cl. at 342. As the DPP Contract expressly disclaims paying
plaintiffs for the mistake they now allege, “it was incumbent upon the plaintiffs to investigate
those issues before entering into the contract.” ConocoPhillips, 501 F.3d at 1380. By acting on
limited knowledge with “conscious ignorance” and agreeing to the DPP without investigation,
plaintiffs bore the risk of mistake. Even if, counterfactually, their claim satisfied elements one,
two, and three of the Atlas Corp. analysis, plaintiffs’ mutual mistake of fact claim would fail

                                               - 44 -
element four. As stated supra Section V.A, the government has shown plaintiffs failed to prove
all four elements of their mutual mistake of fact claim, and the alternative analysis does not
change the Court’s finding the government has shown it is “entitled to judgment as a matter of
law” regarding plaintiffs’ mutual mistake of fact claim. 19 See Anderson v. Liberty Lobby, Inc.,
477 U.S. 242, 250 (1986); Atlas Corp., 895 F.2d at 750; ConocoPhillips, 501 F.3d at 1380.

VI.      Class Certification

        Plaintiffs seek class certification arguing “[t]he Class Members are hospitals that
provided outpatient healthcare services to current and former military members and their families
covered under the U.S. Government’s TRICARE program.” Pls.’ Class Cert. at 1. Plaintiffs
assert “approximately 1,600 similarly situated hospitals across the United States . . . , entered
into the exact same reimbursement contract with the U.S. Government, which contract was the
subject of the exact same mutual mistake, and were as a result all systematically underpaid by
the U.S. Government in the same way under that common contract.” Id. According to plaintiffs,

19
   In the alternative, the government asserts “the parties’ contracts are settlement agreements” which “definitively
settled the question of whether TRICARE underpaid hospitals relative to the Medicare rates . . . , as well as ‘any and
all claims . . . arising out of or resulting from or in in anyway relating to payments . . . or any other means of
compensation’ . . . prior to the institution of the TRICARE [OPPS].” Def.’s MSJ Reply at 32–33. “These
features[,]” the government argues, “foreclose the applicability of the mutual mistake doctrine in this case as a
matter of law.” Id. at 33. According to the government, plaintiffs’ allegation about “erroneous factual assumptions”
is not relevant because “[a] settlement agreement that resolves known factually disputed issues in the face of
uncertainty is equally immune from reformation on the grounds of mutual mistake.” Id. (citing Tarrant v. Monson,
96 Nev. 844, 845–46 (1980)). The government notes “[a]t the time of contracting, the parties were aware . . . there
was an unresolved dispute between TMA and hospitals over the proper interpretation of 32 C.F.R. § 199.14(a)(5).”
Id. at 36–37 (citing DPP Contract Notice at A5).

Though the Court previously found “the [L]etter and Notice initiating the [DPP] were sent to expressly avoid
litigation” and so “cannot constitute preparation for litigation[,]” the Court found the DPP Contract was a
“negotiated business settlement” resolving payment discrepancy issues by “recalculating TRICARE payments,
which became the government’s business during the [DPP].” 14 Jan. 2020 Op. & Order at 20, 25. While the DPP
Contract was not prepared in anticipation of litigation, the parties used “the term ‘settlement’ as a negotiated
business settlement to bring finality to payment adjustments.” Id. at 20. A Nevada Supreme Court case cited by the
government, Tarrant v. Monson, involved an agreement between a jeweler and customer after the jeweler misplaced
the customer’s ring and offered instead a replacement ring before later finding the original ring. 96 Nev. at 845; see
Def.’s MSJ Reply at 33. In Tarrant, the Nevada Supreme Court held: “One who acts, knowing that he does not
know certain matters of fact, makes no mistake as to those matters. If a person is in fact aware of certain
uncertainties a mistake does not exist at all.” Id. Further, “[o]ne who is uncertain assumes the risk that the facts will
turn out unfavorably to his interests.” Id. “Since [the jeweler] at time of agreement knew that the ring might later
be found, [the jeweler] bargained with conscious uncertainty and not under a mistaken belief. [The jeweler]
assumed the risk that the facts would turn out unfavorably to his interests.” Id. at 846. Although the roles of the
parties in this case are reversed compared to Tarrant, with plaintiffs seeking contract reformation and the
government defending, the government argues in this case, like Tarrant, “[t]he parties d[id] know what they d[id]n’t
know.” Tr. at 148:14–15. Plaintiffs entered the DPP Contract knowing they did not know whether they were
correctly paid facility charges, even with the express provision providing for the opposite of their current mutual
mistake argument—“[hospitals] are not entitled to an additional ‘facility charge’ under paragraph (xi).” DPP
Contract Notice at A5; see Def.’s MSJ App. at A19 (Ingham Regional Medical Center), A21 (Integris Baptist
Regional), A23 (Integris Bass Baptist), A25 (Integris Grove Hospital), A27 (Integris Baptist Medical), A29 (Integris
Canadian Valley). To the extent the contract qualified as a settlement agreement, the Court would alternatively find
plaintiffs bore the risk under the DPP negotiated business settlement. See Tarrant, 96 Nev. 844; 14 Jan. 2020 Op. &
Order at 22.

                                                         - 45 -
“[c]ommon issues thus predominate” as “the financial injury suffered by each of the Class
Members is easily ascertained through a uniform damages methodology” and “[t]he only
difference among Class Members is the amount of damages.” Id. The parties briefed their
argument for class certification pertaining to the potential class of approximately 1,600 hospitals.
See Def.’s Class Cert. Resp.; Pls.’ Class Cert. Reply.

        Plaintiffs argue at least two facts are common to all Class members: (1) “the
Government failed to calculate properly payments owed to Class Members for outpatient
radiology services in accordance with the contract because it omitted hospital claims data, which
are the specific line item requests for reimbursement submitted by hospitals to TRICARE”; and
(2) “the Government’s representation in the contract that categories of outpatient services other
than radiology services were not underpaid was incorrect” because it “improperly failed to
account for facility charges when it made representations in the [DPP] that all other outpatient
services had been paid at amounts equal to or more than that which would have been paid under
Medicare principles.” Pls.’ Class Cert. at 2–3. Plaintiffs “seek certification pursuant to RCFC
23 of the following Class: [a]ll hospitals in the United States that participated in the [DPP]
described in the . . . [L]etter . . . , and the Notice . . . referred to therein, and that signed a release
and received a payment through the [DPP].” Id. at 4.

        Plaintiffs argue their breach of contract claim raises at least two common issues of law
and fact: (1) “[w]hether, in calculating the amounts owed to Class Members, the Government
captured and used all of the claims data that it was required to use under the terms of the
contract;” and (2) “[w]hether the Government paid each Class Member the amount it was
entitled to under the [DPP].” Id. at 24. Plaintiffs argue the breach of contract claim affects all
class members. Id. The relevant potential class, however, is only the class of plaintiffs affected
by the government’s breach of contract for failure to follow the DPP in limited circumstances
because the Court finds the DPP Contract only obligated TMA to use its data, not the hospitals’
data. See supra Sections IV.A, B, D; Tr. at 132:4–13.

         Plaintiffs argue the proposed class of approximately 1,600 hospitals satisfies RCFC class
certification requirements, which have been “‘succinctly described as comprising inquiry into the
elements of numerosity, commonality, typicality, adequacy, and superiority.’” Pls.’ Class Cert.
at 19 (quoting Singleton v. United States, 92 Fed. Cl. 78, 82 (2010)). Plaintiffs’ class
certification briefing does not address the “numerosity, commonality, typicality, adequacy, and
superiority” of the narrow class of plaintiffs affected by the government’s breach of contract for
failure to follow the DPP in limited circumstances. See supra Section IV.F. In oral argument on
9 June 2022 on the government’s motion for summary judgment, plaintiffs admitted if the Court
finds the DPP Contract only obligated TMA to use its data, the class would be “smaller than the
whole class” argued in briefing. Tr. at 132:4–13. Plaintiffs focused their briefing on arguing
commonality under the breach of contract claim for the large class of approximately 1,600
hospitals and did not address the commonality of what plaintiffs admit is a smaller class. See
Pls.’ Class Cert. at 22–25.

        Based on the summary judgment holding in this order, the Court therefore needs further
information regarding how plaintiffs in this post-summary judgment smaller class would meet
the requirements for class certification. See Tr. at 260:21–261:9 (“THE COURT: Is that not a

                                                  - 46 -
fair, clear, ascertainable grouping of hospitals that is smaller than the full class alleged by
plaintiffs now, but a class capable of being defined and a class that would have each individual
hospital making its own individual calculation of damages? [THE GOVERNMENT]: . . . [T]o
make a prima facie case, even on those points, you’re still left with the problem of taking their
data and doing a comparison to the government’s data.”). The Court accordingly declines to rule
on plaintiffs’ class certification motion at this time. As the only surviving claims are breach of
contract for failure to follow the DPP in a few limited circumstances, the parties did not
adequately brief the narrower proposed class of plaintiffs arising under the remaining claims.
The parties shall file a joint status report providing the parties’ views on class certification for the
smaller class of plaintiffs affected by the government’s breach of contract for failure to follow
the DPP in limited circumstances and on whether further briefing is necessary.

VII.    Conclusion

        For the foregoing reasons, the Court GRANTS plaintiffs’ motion for leave to file
amended briefs and appendices to the extent considered in this Opinion and Order, ECF No. 242,
and GRANTS IN PART and DENIES IN PART the government’s motion for summary
judgment, ECF No. 203. The Court GRANTS the government’s motion for summary judgment
as to plaintiffs’ hospital-data duty and mutual mistake of fact claims but DENIES the
government’s motion as to plaintiffs’ TMA-data duty and alternate zip code claims. The Court
STAYS the evidentiary motions as the Court established in the status conference held on 11 May
2022 20 plaintiffs’ motions to exclude expert opinions—ECF Nos. 205, 206—and the continued
participation of Kennell, ECF No. 251, are not consequential for the government’s summary
judgment motion. For the same reason, the Court STAYS the government’s motions to strike
“Paragraphs 3 - 10 of the Dale Thompson Declaration,” ECF No. 239, and “Paragraphs 7 and 18
of the Declaration of Sere Allen, and Associated Briefing,” ECF No. 240. The Court STAYS the
government’s motion to exclude inadmissible evidence pursuant to Rule 408, ECF No. 204, and,
thus, the Court STAYS the government’s motion to strike “Rule 408 Evidence Relied on by
Plaintiffs in Summary Judgment Briefing,” ECF No. 238. On or before 28 December 2022, the
parties SHALL FILE a joint status report updating the Court on plaintiffs’ motion for leave to
file amended briefs and appendices and providing their views on further briefing related to
plaintiffs’ motion to certify class.

        IT IS SO ORDERED.

                                                                  s/ Ryan T. Holte
                                                                  RYAN T. HOLTE
                                                                  Judge

20
   See supra Section I.D (noting government’s motions to exclude expert opinions of Jane Jerzack, ECF No. 205,
Anthony Fay, ECF No. 206, and David Kennell, ECF No. 251; motions to strike “Rule 408 Evidence Relied on by
Plaintiffs in Summary Judgment Briefing,” ECF No. 238, “Paragraphs 7 and 18 of the Declaration of Sere Allen,
and Associated Briefing,” ECF No. 239, and “Paragraphs 3 - 10 of the Dale Thompson Declaration,” ECF No. 240;
and motion to exclude inadmissible evidence pursuant to Rule 408, ECF No. 204, are not consequential for
summary judgment).

                                                    - 47 -