United States District Court, W.D. Virginia, Harrisonburg Division
THE UNITED STATES OF AMERICA For the use and benefit of VT MILCOM, INC., Plaintiff,
PAT USA, INC., et al., Defendants.
MEMORANDUM OPINION AND ORDER REGARDING SUMMARY
Elizabeth K. Dillon, United States District Judge
case arises from a subcontract between PAT USA, Inc., and VT
Milcom, Inc., whereby VT Milcom was to provide labor and
materials for the installation of telecommunications systems
in Qatar for a United States Army Corps of Engineers project.
VT Milcom brings its action under the Miller Act and asserts
three claims: a breach of contract claim against PAT USA, a
claim for breach of a surety obligation contract against PAT
USA, Gerald Dinkins, Sr., and First Mountain Bancorp (FMB),
a claim for quantum meruit against all three defendants.
case was initially filed in the Eastern District of Virginia
but was transferred to this court. VT Milcom timely moved for
summary judgment with many of the facts stipulated by the
parties. PAT USA and FMB filed a brief in
opposition,  and Dinkins filed no
response. Before addressing the summary judgment
motion, though, the court turns to a preliminary issue-
whether it has personal jurisdiction over the defendants.
their opposition brief, PAT USA and FMB argued that this
court lacked personal jurisdiction over them. All defendants
filed a 12(b)(2) motion challenging personal jurisdiction
when they first responded to the complaint, but they never
requested a hearing in this court or submitted the issue to
the court without a hearing. Instead, defendants PAT USA and
FMB engaged in discovery, amended the scheduling order,
entered into stipulations, and only mentioned the issue again
in their memorandum in opposition to VT Milcom's motion
for summary judgment. Local Rule 11(b) requires a party to
set a hearing or advise the court that a hearing is not
needed within 60 days after the motion is filed; otherwise,
the motion is deemed withdrawn. W.D. Va. Civ. Rule 11(b).
Here, defendants' motion is deemed withdrawn, and in any
event defendants have waived any challenge to personal
jurisdiction. See, e.g., Ins. Corp. of Ir. v.
Compagnie des Bauxites de Guinee, 456 U.S. 694, 704-05
(1982) (“The actions of the defendant may amount to a
legal submission to the jurisdiction of the court, whether
voluntary or not.”); United States ex rel.
Combustion Sys. Sales, 112 F.R.D. 685, 687 (M.D. N.C.
1986) (noting that waiver of a personal jurisdiction defense
“has been inferred in a wide variety of situations,
even when the defense has been formally raised in an answer,
by conduct and inaction, such as . . . participating in . . .
The Prime Contract and Subcontract
October 2013, the United States Army Corps of Engineers
(USACE) awarded PAT USA a contract (the Prime Contract) for
minor military construction projects on United States
facilities in Qatar. As a requirement of that contract, PAT
USA provided a payment bond that identified defendant Gerald
Dinkins, Sr. as the surety. PAT USA also provided an
Irrevocable Trust Receipt issued by defendant FMB. On
February 22, 2014, PAT USA entered into a subcontract with VT
Milcom (the Subcontract, Compl. Ex. C, Dkt. No. 1), under
which VT Milcom agreed to provide labor and materials for the
installation of telecommunications systems on the project
site in Qatar. After one change order, the total
Subcontract fixed-price amount was $485, 684.73. VT Milcom
subsequently performed work and furnished materials for the
project as directed by PAT USA, including shipping materials
January 29, 2015, PAT USA informed VT Milcom that the Prime
Contract was on hold and that USACE was not allowing work on
the project. (Compl. ¶ 28; Answer ¶ 28, Dkt. No.
15.) Unbeknownst to VT Milcom and by letter dated January 30,
USACE terminated PAT USA for default and for reasons not
involving VT Milcom. (Stipulation ¶ 6, Dkt. No. 45.) By
email dated January 31, PAT USA arranged for delivery of the
balance of the materials by VT Milcom to Qatar. (Pl.'s Br.
Ex. A, at 20; Req. for Adm. No. 70, Dkt. No. 43-1; Order,
Dkt. No. 72.) Then, by letter dated February 2, PAT USA
informed VT Milcom of the Prime Contract termination and
terminated the Subcontract, wrongly claiming that VT Milcom
had defaulted upon its performance obligations. VT Milcom
invoiced PAT USA a total of $208, 727.48 for work performed
and materials furnished; however, PAT USA only paid VT Milcom
$91, 617.16. The amount paid constituted 20% of the fixed
price. According to PAT USA, that amount is all it owes
because Schedule D of the Subcontract lists the payment
milestone for material purchase as 20%. VT Milcom
subsequently filed this suit, seeking to recover the
remaining $117, 110.32 invoiced to PAT USA. After discovery
and a stipulation by the parties to the majority of the
above-stated facts, VT Milcom moved for summary judgment.
(Pl.'s Mot. Summ. J., Dkt. No. 51.)
parties rely upon the following provisions of the
SECTION SIX - SUBCONTRACT AMOUNT
a. The fixed-price of U.S. Dollars Four hundred Eighty two
thousand and One Hundred Ninety five and 60/100 only ($
482, 195.60) subject to additions as provided for in the
b. Time and material rates and prices in accordance with
the attached Schedule of Labor and Material Costs which is
incorporated by reference and identified as Schedule C.
The fixed-price, unit prices and/or time and material rates
and prices are referred to as the Subcontract Amount.
. . . .
EIGHT - PAYMENT
. . . .
Subcontractor shall submit progress payment applications . .
. to Contractor no later than the 20th day of each
payment period for the value of the Subcontract Work
performed up to and including the last day of the payment
period indicating work completed and, to the extent allowed
under this Agreement, materials suitably stored during the
preceding payment period. Payments will be made to the
Subcontractor no later than 3 business days after receipt of
payment from the owner for each application period. All
payments to the Subcontractor are to be made only equivalent
to payments the Contractor receives from the Owner. The
Contractor's receipt of payment from the Owner is a
condition precedent to the Contractor's obligation to pay
the Subcontractor. Contractor and subcontractor share risk of
owner payment. Subcontractor's preferred terms for
receipt of payment is [sic] Net 30.
10 - CONTRACTOR'S RIGHT TO PERFORM SUBCONTRACTOR'S
RESPONSIBILITIES AND TERMINATION OF AGREEMENT
. . . .
SCHEDULE C - Price Schedule (Assigned at a later
Price schedule Pricing listed is for the
providing and installing materials for the projects
communications systems as outlined within this proposal:
Base Bid Firm Fixed ...